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ERIN BURNETT OUTFRONT

The Dow dropping 225 points today; the bloodbath in Cairo; One grandmother is accusing San Diego mayor Bob Filner of sexual harassment; Booz Allen was awarded a $6 billion contract by the government; Monitoring tropical storm Erin; Hannah Anderson Makes First Appearance

Aired August 15, 2013 - 19:00   ET

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


ERIN BURNETT, CNN HOST, OUTFRONT: Good evening, everyone. I'm Erin Burnett.

And OUTFRONT tonight, we begin with the breaking news of stock is plunging. The Dow dropping 225 points today, nearly 350 points in the last 48 hours, the biggest selloff for stocks in nearly two months.

Jim Bianco joins me, the president of Bianco Research.

And Jim, what is causing this? When you have companies and really big, important ones like Walmart saying we are really worried, things aren't as good as we thought? At the same time, some economic data on jobs seems to be better than people thought. So, what's the problem?

JIM BIANCO, PRESIDENT, BIANCO RESEARCH: Yes, that is the problem. It's a conflict that Wall Street is trying to struggle with. It all comes back to the Federal Reserve and whether or not the stimulus that the Federal Reserve has been giving us through quantitative ceasing will continue.

Today, I think Wall Street was more worried by the drop and the initial claims for unemployment insurance and to the lowest levels since 2007 that the Federal Reserve might pull back on the stimulus and that was an overwhelming concern for the bond market that shot up rates and shot stocks down, even though Walmart and some other companies kind of gave us kind of the opposite news that things weren't going as well over there.

BURNETT: Yes. So what would you do right now? Would you, you know, bet that today was wrong and you would buy stocks that were going to go higher, or do you think interest rates will still keep going up?

BIANCO: See, I think the key to the bond market -- or the key to the stock market is the bond market right now. A lot of people think rates are going to continue to go higher. If the fed pulls back on the stimulus, remember, the stimulus the fed does is they buy bonds so the rest of us don't have to and we put -- invest our money in stocks. If the fed pulls back on buying bonds, interest rates will go higher. We are worried that is going to hurt housing, that is going to hurt car sales and that is going to slow down the economy. And while I think that could very well happen if the fed pulls back, I think the stock market will continue to struggle under the weight of higher interest rates.

BURNETT: All right, Jim Bianco. Thank you very much.

That's going to be the fascinating question. And, of course, for so many, you got to think about interest rates going up meaning refinance as quickly as you can if you haven't already.

And now our second story OUTFRONT, the bloodbath in Cairo. The bodies of some of the 580 people killed over the past two days now line the floor of a mosque. These are horrible pictures to look at. It is a day after the deadliest clashes between the Egyptian military forces and supporters of the ousted president Mohammed Morsi.

Today, President Obama took time from his vacation on Martha's Vineyard to address the crisis.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: While we want to sustain our relationship with Egypt, our traditional cooperation cannot continue as usual when civilians are being killed in the streets and rights are being rolled back. As a result, this morning we notified the Egyptian government that we are canceling our biannual joint military exercise which was scheduled for next month.

(END VIDEO CLIP)

BURNETT: But is the president doing enough? State department spokes woman Jen Psaki is OUTFRONT.

Jen, thanks for taking the time.

JEN PSAKI, STATE DEPARTMENT SPOKESWOMAN: My pleasure.

BURNETT: Obviously, as we have just said, more than 500 people have been killed in the past day alone. The United States, of course, giving Egypt about $1.3 billion in military aid and a lot of critics say at the least you got to cut off that aid, why not just do it?

PSAKI: Well, Erin, first let me say, as the president said, as the secretary said yesterday, the events that have happened the last two days are deplorable, horrific, there aren't enough adjectives to come up with to describe them.

Our relationship with Egypt, though, is not only complicated, it is a long-term relationship. And we are continuing to provide aid at this time, as you know, we're reviewing it. But because we believe that it's in our national security interests, in it's our regional interest, the region stability and also because we support this rocky path back to democracy and we know that's going to be a long journey.

BURNETT: Now, when you say support, security, and stability, let me just ask you, you know, the president had said back on July 3rd when this started six weeks ago, I call on the Egyptian military to return full authority back to a democratically elected civilian government and avoid arbitrary arrests. Of course, hundreds have been jailed, abused and now killed. How is the security situation any better? How is stability any better? How is this aid provided us any leverage?

PSAKI: Well, you heard the president say, we are done with business as usual. And you mentioned obviously the decision, the announcement today, to cancel the joint military exercises and just a few weeks ago we announced plans to postpone delivery on f-16s. So there's a constant review of what aid we should provide given the circumstances.

What I'm talking about regional stability, I'm talking about the role that Egypt plays in that region. So, in terms of maintaining stability in the region, that's something we still certainly factor in and still feel at this point it's in our national security interests to maintain that aid, but we continue to review it.

BURNETT: And I want to ask you more about that in a moment. But, first, this issue of aid obviously links to whether the administration calls this a coup and obviously that designation as you're painfully aware would automatically cut off the aid by law. So, I just want to play for you what you and others in the administration have said so far about this crucial word "coup."

PSAKI: Yes.

(BEGIN VIDEO CLIP)

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: We don't believe it's necessary to hastily reach a determination.

PSAKI: We have determined that we do not need to make a determination.

UNIDENTIFIED MALE: Isn't that the --

JOSH EARNEST, WHITE HOUSE PRINCIPAL DEPUTY PRESS SECRETARY: We have determined that it is not in the best interests of the United States to make that determination.

(END VIDEO CLIP)

BURNETT: And obviously, Jen, it wasn't this difficult in Mali. You know, you had generals taking over a democratically elected government. Al-Qaeda linked groups controlled half the country then. The U.S. government called it a coup and aid ended.

To be consistent with that move, calling Egypt a coup seemed pretty clear to a lot of people as you know. So, from the U.S. point of view, sire, bad guys who were democratically elected got kicked out by, I know I'm being simplistic here, but what America felt were badder guys. But they still kill kicked them out undemocratically.

So, when you look at it that way, isn't it fair for some to conclude that was a coup, just a coup where America liked the winner so we don't want to call it one?

PSAKI: Well, a coup is a definition and we abide by our legal obligations. This was obviously looked at very closely by legal teams throughout the administration. But we look at this as bigger than events that happened on one day or what the name terminology is. We are looking at this about our broad relationship with Egypt. And that's the reason we made the decision we did, which was not to make a determination and we abided by our legal obligations.

BURNETT: Thanks very much to you, Jen Psaki.

I want to bring in John King now who, of course, who has been following this story and following the president.

And John, you just heard Jen Psaki making the case, the president ending up telling military exercises and cutting off some f-16s, (INAUDIBLE), calling it a coup and ending aid is not necessary. But they are walking a rhetorically difficult line.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Erin, the president has no good choice here. And now, he is trying to recover from what was a bad bet, a bet perhaps he had to make, but a bet. The administration's bet was that the military would take a much more measured path, that the military would accept help if not from the United States which can't get out front on some of the issues because of its relationship in the region, but from the Qataris, from the Arabis (ph).

The administration hoped that Qataris, the (INAUDIBLE) and others would broker a deal with the Muslim brotherhood, would get the military to get on a measured, more moderate path toward the elections. That has not happened and you have these stunning numbers about the deaths and the wounded. So, the president had to break from his bet today and come out and condemn the military.

On the question of aid, the administration is honest about this in private conversations. They think they have a very you tiny amount of leverage with the Egyptian military right now and cutting off the aid would cost them that little bit of leverage. The question is and you tried to ask this with Jen Psaki straightforwardly, where is the proof the United States has had any leverage, they have called the generals, they sent backups, they said stop the violence and they are getting no response. So, that is why you hear to cut the aid crowd. Both Democrats and Republicans, the number is growing. Not enough to make the president move yet, but it is a growing number.

BURNETT: It is a growing number. But you know, what's interesting, John, when you look at it and you look at it compared to a place like Mali, right, which had extremists rising, there do appear to be a lot of inconsistencies, right? So, it seems, you could make the argument very clearly, that the right thing would be to call it a coup and cut off aid, not everyone agrees, but a lot of people make the argument. But the polling, John, shows Americans don't want to do it, over overwhelmingly as you know, nearly 80 percent of Americans say stay out of what is going on and 78 percent say mostly stay out.

So, what do you make of that? Is this the time where the president has to say, I'm going to do it the right thing is whether that means going with what the American people want or not, similar to the decision presidents have had to make in times of war in this country? KING: Remember back to Libya where you heard the chorus of leading from behind criticism. You are starting to hear that again when it comes to Egypt.

This is by most accounts even friends of the administration say this is a very risk-averse president when it comes to the Middle East. Where has been -- where is the bold policy on Syria? Where is the bold policy on Arab/Israeli conflict? Where is it now in Egypt?

So, one expert put it to me very bluntly and said the president cares a lot about the middle-class here, a lot more about the middle-class here than he does about the Middle East. And those numbers back the president up, Erin, when 80 percent of Americans, 78 percent of Americans say stay out of this. The president knows politically here at home. Yes, he's being criticized. Yes, on the world stage, the stature of the United States, the reputation in the region is at issue here. But here at home, he knows this is a country exhausted by Iraq and Afghanistan that does not want much any action in the Middle East that could lead you to a military or long-term intervention or investment, financial money. So, the president thinks he's on very safe ground domestically, politically, but a lot of questions about what's the policy.

BURNETT: That's right. Maybe domestically on the right side but long-term internationally perhaps not, but we'll see what he does.

Thanks so much, John King.

KING: Thank you.

BURNETT: And still to come, the investigation in to San Diego's mayor gets even more disturbing. His latest alleged victim is a great grandmother and our Kyung Lah breaking more exclusive news tonight.

Plus, new information from the Hannah Anderson case, this hour she makes her first public appearance since the abduction.

And then, you have probably seen the stories about how coffee can save your life. You probably clung to them and, you know, said this is justification for how much of it you drink. Well, too bad the opposite might be true.

And later in the show, an update from the UPS plane crash. Those so- called black boxes found.

(COMMERCIAL BREAK)

BURNETT: Our third story OUTFRONT, yet another woman accusing San Diego mayor Bob Filner of sexual harassment and this time your jaw will drop in disbelief. It's a great grandmother bringing the list of accusers to 16.

Now, Filner won't resign, but the city attorney is now telling CNN that he may be able to force the mayor out of office. All in connection to a report from our own Kyung Lah earlier this week who has been breaking so much of this story first. Here's Kyung on the key pieces of information the city is now looking at, part of our continuing OUTFRONT investigation on the San Diego mayor.

(BEGIN VIDEOTAPE)

KYUNG LAH, CNN CORRESPONDENT (voice-over): Walking slowly, assisted by a cane, 67-year-old great grandmother Peggy Shannon said Mayor Bob Filner repeatedly harassed her for months on the job stopping by her desk in the senior center services center in the lobby of city hall. She alleges, she once grabbed and kissed her on the lips and even told her, think I can go eight hours in one night?

PEGGY SHANNON, ALLEGED HARASSMENT VICTIM: Mayor Filner, I am a mother, a grandmother and a great grandmother. I have three sons, four grandsons and two great grandsons. As our mayor, you should be, but are not a role model for any of them.

LAH: Shannon is the 16th woman to publicly accuse the mayor of sexual harassment but the first senior citizen.

A great grandmother doesn't surprise you?

JAN GOLDSMITH, SAN DIEGO CITY ATTORNEY: At this point nothing would surprise us.

LAH: San Diego city attorney, Jan Goldsmith, has been leading an internal investigation on Filner, pressure is building to oust a mayor who doesn't want to budge. Goldsmith says he may have found a way connected to a story CNN reported, unusual charges on the mayor's city-issued credit card.

As you heard on OUTFRONT this week, that includes charges at the Westgate hotel. Off camera two patrons told us they often spotted the mayor here at odd hours, always with a different woman. The city attorney's office confirms hotel charges were indeed personal expenses.

The city attorney also says the mayor's credit card had personal charges from this restaurant about $500 spent over five months. He also flew first class to Paris on a junket that the city attorney says had nothing to do with city business. The credit card was not paid for months. Goldsmith says the bank threatened San Diego's credit rating so the city canceled Filner's card.

Those personal charges are the key, believes Goldsmith, as laid out in his memo to the city council, the city's charter has little-used section about firing city officers for unauthorized use of city money.

GOLDSMITH: Somebody so brazen and abusive and personal often that translates into the same type of conduct in financial affairs.

LAH: What would you like to tell the mayor?

GOLDSMITH: It's futile because it's just a matter of time. You can hold in there for a few months, if you want. The legal problems are mounting.

(END VIDEOTAPE)

LAH: Now, we did reach out to Filner's attorney for comment. He did not respond to our requests. So, while there are all these very serious developments, there's actually a piece of, video that everybody in San Diego is talking about, a lot of people nationally talking about it.

And check this out, Erin, it is a video parody. You may actually recognize what it's parodying, it's a Robin Thicke video and they are having a bit of fun. Here is where the problem is. Is that it was produced by UTTV, the television branch of the San Diego paper. While it is funny, there are some questions as to whether or not the people you're looking at who are news anchors, that they should be participating in this.

Well, the UTTV, did give us a statement saying, quote "the video was made by the hosts of the morning talk show "front page." The hosts are not news anchors and do not represent UTTV's news programming. It was meant as a lighthearted parody for a personality driven show, not as a piece of journalism."

A lot of people have been saying, Erin, this is demeaning to some of these news anchors. A lot of others, though, are saying it's quite funny, it captures how people really do feel that Filner needs to resign.

BURNETT: Yes. All right, Kyung Lah, thank you so much, as we said breaking so much of this story.

We have some breaking news right now that I want to share with you.

Hannah Anderson has arrived at a fund-raiser on her hometown, just outside of San Diego, literally just arriving, and you can see here there. This is the first time we have seen the 16-year-old in public since he was kidnapped by a family friend, the man who is also accused of killing her mother and her brother in horrific circumstances.

The fund-raiser is happening right now. We are going to be going there live coming up in the hour. But we just wanted to let you know that she had indeed arrived. This is the first time we have seen her, as you can see, since she was rescued from DiMaggio in Idaho a couple days ago.

And now our third story OUTFRONT, Edward Snowden's former employer winning multibillion dollar contracts from Uncle Sam, even after Snowden stole classified data while he was a Booz employee.

Now, Snowden worked as an administrator for the contract in firm Booz Allen Hamilton for just a few weeks before leaking thousands of classified NSA documents in May. But this week, Booz Allen was awarded part of a cyber security contract worth up to $6 billion. It could be one of the biggest contracts in the American government.

This may shock you. Why is the government rewarding Booz Allen just after one of the worst intelligent leaks in American history came out of Booz Allen?

Chris Lawrence is OUTFRONT.

And, Chris, when you hear this, it sort of does stun you, right? I mean, walk me through this. How is Booz Allen, after it was their employee that did this while working for Booz Allen, winning multibillion dollar cyber security contracts?

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: Well, a couple reasons.

Probably number one is that they're one of a few agencies with the expertise to handle these kinds of jobs. But perhaps more importantly, the U.S. government did not hold Booz Allen accountable. They looked at it as a one-off, rogue situation. It did not blame Booz for the actions of Edward Snowden. Probably a good idea when you consider the Bradley Manning case and the fact that the U.S. government is not immune to its own hackers.

What may surprise you is the fact that this is not the only contract that Booz has won since that scandal broke. Take a look, back in June they got a $25 million contract from the department of transportation, the month after that, in July $78 million in contracts with the department of Veterans Affairs and Health and Human services. And finally, just a couple weeks ago, $900 million contract to support cyber security at the space and naval warfare systems center.

In fact, Booz Allen released a statement saying, Booz Allen is proud of the high level of expertise we bring to government clients today and the value of the work we've provided to all clients for nearly 100 years. This is part of the $6 billion contract ironically, they will be helping the department of homeland security develop ways to combat hacking --Erin.

BURNETT: I can't even believe I'm laughing, but, I'm sorry, just you know, when you put it all together.

But all right, to be fair, to your point, Booz Allen didn't best know that or decide the security clearance. That actually was left to another contractor, USIS. Now, they are under grand jury investigation. But I guess the bigger question here is, you know, is the government doing anything to wean itself off of what frankly, is a frightening dependency on contractors?

LAWRENCE: The no just wean itself off contractors, wean itself off people. They are trying to get away from this whole idea of using systems administrators like Snowden to do a lot of these jobs. In fact, the director of the national security agency recently announced that they are accelerating plans to really move a lot of this work on to computers.

(BEGIN VIDEO CLIP)

GEN. KEITH ALEXANDER, DIRECTOR, NATIONAL SECURITY AGENCY: What we are in the process of doing, not fast enough, is reducing our system administrators by about 90 percent, for the first reason, which was to make our networks more defensible and more secure. (END VIDEO CLIP)

LAWRENCE: To put that in perspective, there are about 1,000 systems administrators like Edward Snowden. At the end of there may only be 100 -- Erin?

BURNETT: That is incredible.

All right, thanks so much, Chris.

LAWRENCE: You're welcome.

BURNETT: All right, still to come, tropical storm Erin, yes, Erin, has formed off the coast of Africa. And this incredibly rare, it could be much more dangerous than we believed. We have a special report on that.

Plus, the truth about prescription drug abuse. Could you be part of the problem and not actually even be aware of or the risk? Dr. Drew is with us.

What do you get when you cross a cat with a teddy bear? A brand-new real species is OUTFRONT tonight.

(COMMERCIAL BREAK)

BURNETT: Our fifth story OUTFRONT, tropical storm Erin. That's right, the fifth named storm of the season and I happen to share the same name, but the storm is still really far away, but it's actually really unusual that it has formed so close to the coast of Africa. So, does that mean if and when, it strikes the U.S. mainland, it will be a monster?

OUTFRONT tonight, our meteorologist Chad Myers.

So, Chad, ten months since that superstorm Sandy hit which was one of those strange ones that ended up being absolutely apocalyptic for many people, what do you make of this storm and the season?

CHAD MYERS, AMS METEOROLOGIST: Well, you know, the Cape Verde season, it lets these hurricanes grow for a long time. You say that it's far away. That's great news that it's far away. The problem is it's far away, so it's going to get a long run. Think of the sprinter that can sprint for 40 yards. By the time you get to 40 yards, you're really going. Now, the first five or six yards you're not going very fast. So, think about the biggest tropical storm that we ever had out there, that was Andrew.

Now, 21 years ago tomorrow was hurricane Andrew, so the Cape Verde season is something to always watch. This storm is forecast to get into drier air. It's not forecast to be a big storm just yet. But the problem is, because it's so far away, these models can change and even though it's forecast to be down to a 40-mile-per-hour storm, approaching a hurricane on Saturday, not every model has that same forecast. It still could get closer to us and to make a run like Andrew did. So, this isn't over yet. When these storms form out there, we always have to watch them.

BURNETT: Yes, you know, it's pretty amazing. I guess, Chad, as you do, you look back at history and some of the storms that have formed so early on, i.e., so far away, have been the most dangerous we have ever seen.

MYERS: You know, I have to print them out because I was so impressed. When you start with Andrew, then you go to George and Floyd and Isaac and Erin, didn't hit any land but there was a hurricane Erin in 2001. Because it didn't hit anything it didn't get retired. But then you go Isabel, Frances, Ivan, Dennis, Gordon and I can go on. The big ones, the real big storms that were three and four categories even to a category five, they all start out there.

BURNETT: Wow, all right. Well, something to watch. And I guess I can just hope that this one is not one of the horrible ones because I don't want a the Erin to get retired.

MYERS: That's right.

BURNETT: Thank you, Chad.

MYERS: Take care, Erin.

BURNETT: All right.

Well, still to come, just a few moments ago we saw Hannah Anderson arrive at a fund-raiser, you been see her getting there out of a car, the first time we have seen her since her abduction and rescue. We are going to go there alive and tell you what we have just learned about how her family was killed.

Plus, a new study says coffee may not be as good for you as you think. You probably read the studies and justified your drinking of it. And you know what, you might be dead wrong. We will tell you why.

(COMMERCIAL BREAK)

ERIN BURNETT, CNN ANCHOR: And welcome back to the second half of OUTRONT. We start with stories where we focus on reporting from the frontlines.

I want to begin with some new details and images that we have here at CNN on the UPS plane crash in which two pilots died in Birmingham, Alabama. The NTSB said today they were able to recover flight data recorders. You can see there in the smoldering records. Officials examining the records this evening have told us a preliminary investigation has found no evidence of engine failure, no evidence of a fire prior to impact, and no indication that there was a problem with the runway lights. According to one study, the rate of fatal cargo accidents is eight times higher than that of passenger jets.

It has been four months since the Boston marathon bombings and almost as long since we've heard from the family of victim, Martin Richard, until today. An hour goes by, they tell us that they don't feel agony over his death, that little boy, but it is not all heartbreak, his sister Jane was released from a rehab hospital just a few weeks ago.

You see her there. They say the loss of her leg has not deterred her and that watching her dance with her prosthetic they say is, quote, "priceless".

We are thinking and rooting for the Martin family tonight.

And did you know that about 64 percent of Americans drink coffee every day? You might think it's even higher than that, but why wouldn't they? You know, there's been recent headlines about how coffee can save your life.

But now, a new Mayo Clinic study shows that coffee could actually kill you. Men under 55 who drank four cups of coffee or more a day were 56 percent more likely to die. That is a really big difference, people.

Heavy coffee drinkers, though, over the age of 55 were not affected, so what gives? Well, we talked to a Mayo Clinic cardiologist who was stumped, too. He said possible explanations include lifestyle factors but obviously there's still questions to be answered still.

Do you know what? Everything in moderation, people.

It has been 740 days since the U.S. lost its top credit rating, what are we doing to get it back? Well, as I mentioned at the top of the hour, the Dow fell nearly 350 points in the past 48 hours, the biggest selloff in about two months. Today, Walmart and Cisco saying the economy was weak was part of the problem.

Ad now our sixth story OUTFRONT: the breaking news on Hannah Anderson.

We're actually seeing her this hour for the first time tonight. The California teen made her first public appearance tonight since being held captive by nearly a week by a family friend named James DiMaggio.

Anderson was rescued in Idaho on Saturday. DiMaggio was killed in the shootout with the FBI at that time. Investigators say Anderson was kidnapped after DiMaggio tortured and killed her mother and 8-year-old little brother.

OUTFRONT tonight, Casey Wian. He's in Lakeside, California, along with clinical psychologist Jeff Gardere.

Good to have both of you with us.

And, Casey, now, we've actually seen for the first time Hannah Anderson getting out of that car, going to the fundraiser, you know, looking like a very normal, pretty, teenage girl. What can you tell us is happening there now?

CASEY WIAN, CNN CORRESPONDENT: Well, it's been a very successful fundraiser here. This restaurant has been -- offered to donate 20 percent of its proceeds from today's sales to Hannah Anderson and her family.

I can tell you, I was inside for several hours and the restaurant has been very, very busy. They're always so holding a raffle here, a lot of community support for Hannah. She did not want cameras inside. Her father did not want cameras inside while she was in there thanking her supporters. She's someone who wants to get her life as back close to normal as she can, so she didn't want the cameras inside the fund- raiser. Her father just came out, though, and thanked everyone. Said that Hannah's doing well. Also thanked the news media in playing a role for helping return her safely to the San Diego area, Erin.

Now, Dr. Gardere, obviously, you've seen Hannah for the first time. We're learning more details as we just said, the horrific situation in which her mother and brother lost hair lives and James DiMaggio killed them. But investigators say James DiMaggio and Hannah Anderson called each other 13 times before her phone was turned off the day she disappeared. We don't know if they actually spoke or what, but 13 times.

What do you make of that?

JEFF GARDERE, CLINICAL PSYCHOLOGIST: Well, it could have been she was calling in response to him, if she didn't get the call, returning the call. We don't really know.

BURNETT: Right.

GARDERE: But what it does tell me clinically is certainly there was some sort of a relationship between this individual DiMaggio and with Hannah. Now, we'll just assume Hannah wanted no parts of it, but it seemed to me if you're calling 13 times and we discussed this, is this some sort of an obsession. Obviously, we know there was this obsession because of what he did to her mother and to her little brother.

BURNETT: Right.

GARDERE: So, this was a very dangerous pedophile.

BURNETT: Right. And important you are using that word now, pedophile.

As Casey mentioned, Hannah's father just spoke and I wanted to play that and go back to Casey. So, here's Hannah's dad.

(BEGIN VIDEO CLIP)

BRETT ANDERSON, HANNAH'S FATHER: This is small community that we're a part of, and the community came together, putting on this great fund- raiser for Hannah and hopefully her future and healing. And this is how lakeside rolls.

So, I just wanted to say how much we appreciate it from everybody -- the community, family, friends -- for being here. And the newscasts for everything you've done for us, and local sheriffs and law enforcement, again.

I have talked directly with the horsemen, and that went very well and gave them more thanks and our love and gratitude. It was a wonderful thing. It was a chance encounter but it did save my daughter's life.

So, other than that, Hannah sends her love. She's doing good day by day. And we'll just keep moving forward from here.

Thank you very much.

REPORTER: (INAUDIBLE)

ANDERSON: Yes, I talked to them by phone.

REPORTER: (INAUDIBLE)

ANDERSON: We have a lot of expenses in front of us. Like I said, I'm not a rich man by any means. But, you know, on a lot of things we'll probably end up donating some of the money if there's extra to exploited children, and right now, we're just looking for her future and get her settled and that's about it for right now.

REPORTER: (INAUDIBLE)

ANDERSON: Right now, she's with her family. And, of course, with some friends, and she's just happy to be here.

All right? Thank you very much. I appreciate it.

(END VIDEO CLIP)

BURNETT: Very gracious there.

And, Casey, let me just ask you, as he talks about Hannah trying to move on and just, you know, no one can comprehend the difficulty that that will entail. We're learning more about what happened. The search warrant has come out. We're learning that Hannah's mother was found in a garage. The family dog was found shot nearby.

What other details are you finding out?

WIAN: Well, one of the most shocking details we heard from those search warrants is, in fact, both Hannah's mother and brother according to law enforcement were tortured before they were killed. Obviously, another tragic aspect to this story.

Another thing I want to point out, you were discussing those 13 phone calls before Hannah was abducted. One of the things that Hannah had said on social media in the last couple of days, you know, we've reported on the fact that she was having conversations with her peers and strangers on social media about her ordeal, she said that DiMaggio tricked them. So perhaps that was something to do with those 13 phone calls, that they were tricked to go over to his house.

One other thing I want to point out. Some people have questioned whether Hannah was something more than a victim throughout this ordeal. We spoke to the San Diego County sheriff's department today. And they reaffirmed and said they absolutely positively reaffirmed in their view that that is exactly what she is, a victim, and nothing more, Erin. BURNETT: All right. And Jeff Gardere, let me ask you about that, that they are reaffirming that she was a victim and when she answered questions to random people and answered questions. Someone asked her, "Why are you talking about this on social media? Are you sure you're a victim? You seem completely fine about it?" And she replied, "Are you kidding me? I'm answering these questions so people know the truth so A-holes like you don't assume things like that."

You know, she's making her case, but is it good to be doing it on social media? Law enforcement saying, look, she was a victim. But should she have to justify herself to random people?

GARDERE: I think when people ask you those questions and you feel you have to answer them over and over again and you need to justify it, then it begins to bring up some doubt in your own mind. Remember, this guy was a pedophile, was he grooming her? She tricked her, tricked the family.

And so, a lot of that guilt may come out. I agree, she is 100 percent the victim. But there is a lot of grooming that goes on and a lot of mind control.

BURNETT: Yes.

GARDERE: I don't know if she's ready to answer those kind of questions, and I would implore her to stay off social media. Make sure that she has a trained professional, her father, with her to protect her from something, doing something that she's not quite ready for.

BURNETT: Let me bring in Dr. Drew, the host of "Dr. Drew", of course, on HLN, into this conversation.

And, Dr. Drew, what do you make of what we're finding out? You know, the 13 calls but the police saying, look, she was a victim, no matter how you look at this, and her now on social media having to defend herself?

DR. DREW PINSKY, HLN HOST: OK. So, I agree with everything you guys have been saying thus far. The two issues is, is she or is she not a victim? And we all, everyone watching this case, agrees 100 percent this lady is a victim.

BURNETT: Yes.

PINSKY: Just because she becomes somehow groomed and complicit in some way because of this guy's grooming does not mean that she's not a victim. He is what -- who has created whatever behavior people are questioning.

This girl was completely in some fashion under the sway of a guy who was completely out of his mind. And she is not responsible for what he has done to her. She is victimized, number one.

Number two, there is an aspect -- while I agree with what you guys were saying, there's an aspect of her going out on social mediate that is somewhat perhaps beneficial to her.

She went to a site that is particularly frequently visited by her peers, other middle to young adolescents. And there she was able to say, hey, here I am, I'm still here, I'm OK. I'm setting the record straight.

And then when people became abusive, as they tend to do in social media --

BURNETT: Yes.

PINSKY: She got rid her -- she got rid of the site, went off, went back with her family and back to quiet.

BURNETT: Yes, which is interesting. And, Dr. Drew, let me show, again, the video that we just have coming in and she's actually just appearing at this restaurant, this fund-raiser, and you see her, Dr. Drew, getting out of the car. You know, as I said, a healthy, pretty, glowing 16-year-old, you know, who has just been through this horrible ordeal. But you see her there.

When you see her -- I mean, I know it's only a quick glimpse, but what do you take away from it?

PINSKY: I can't see anything specific. But I think, though, we will find out in the coming days what exactly she experienced. She did, thank God, have to see what happened to her brother and mom. She didn't even know about what happened to them. I think that is probably the biggest trauma of all that she has to contend with, that and a man being shot in close proximity to her, that is a major trauma and then there is whatever happened to her during the kidnapping.

She -- we don't know if she knew she was kidnapped. She might have thought -- we don't know what she thought.

BURNETT: Right.

PINSKY: It might not have been as traumatic as we all think it was depending on how we experienced what it was he put her through.

BURNETT: Right. And to the point that Dr. Gardere and Dr. Drew are making, you know, DiMaggio had taken her to multiple day trips to places like Malibu and Hollywood, this thing of grooming, that she may not even known what was happening.

All right. Thanks so much to all three of you. We appreciate it.

And still to come -- civil war in the Republican Party. Chris Christie and Rand Paul say they have buried the hatchet. But you know what, if that's what burying the hatchet looks like, I don't want to know what throwing one at one another would look like.

Plus, America's largest annual pot festival is set to begin. Why the police have volunteered to cater it.

And now, tonight's shout-out, scientists have discovered a new species of mammal called the olinguito. Found in Ecuador and Colombia, it belongs to a group of mammals which include dogs, cats, and bears. Christopher Helgin, curator of mammals at the Smithsonian say that it is literally a cross between a teddy bear and a house cat.

We tried to guess what the combination would look like, it looks exactly like described. That is pretty amazing. Before you get excited consider this -- especially when you worry about, you know, all these things you hear that we are killing species every day -- 20,000 new species are discovered every year, that's 55 a day.

Tonight's shootout goes to the thousands of animals, hundreds of thousands, maybe millions, who knows, the ones we haven't found.

(COMMERCIAL BREAK)

BURNETT: Chris Christie is not backing down. The hard-charging governor of New Jersey made his case for 2016 and took a few of his potential rivals down along the way while speaking to a group of Republicans this afternoon. Here is Chris Christie:

(BEGIN AUDIO CLIP)

GOV. CHRIS CHRISTIE (R), NEW JERSEY: I think we have some folks who believe that our job is to be college professors. For our ideas to matter we have to win, because if we don't win, we don't govern. And if we don't govern, all we do is shout into the wind. And so I am going to do anything I need to do to win.

(END AUDIO CLIP)

BURNETT: All right. Now, he's talking directly, but, of course, some people did take that to be a swipe at Rand Paul, who he accused of having esoteric and intellectual debates.

So we thought the two had buried the hatchet.

All right, what's going on? Is Christie being a bully or not?

OUTFRONT tonight, opinion columnist Dean Obeidallah, and Hogan Gidley, former national communications director for Rick Santorum.

OK, good to talk to you two.

Hogan, about an hour ago, it heated up even more. We got a statement from Rand Paul's office saying, "So, if I translate, Governor Christie correctly, we shouldn't be the party of ideas. We shouldn't care what we stand for even if we stand for anything. We reject that idea. Content-free so-called pragmatism is the problem, not the solution."

Three years of this is going to get interesting, or maybe beyond interesting back to back.

HOGAN GIDLEY, FORMER NATIONAL COMMUNICATIONS DIRECTOR FOR RICK SANTORUM: Yes, it's already interesting. What I do find funny here is that Chris Christie has the reputation of being bold (ph) but also being somewhat of a bully. What is fascinating to me here is Rand Paul saying, bring it on. And if you come at me, I'm going to come at you like a rabid spider monkey and hit him right in the face.

And, you know, when the schoolyard bully comes at you, what do you do to back him down? Punch him in the nose. Rand Paul punched him square in the nose.

Now, I do think both of these gentlemen would be best served focusing their efforts and energies and swipe to the left as supposed to intra- politics. But I understand the dynamic shift within the party right now and they are both jockeying for position, trying to be the front runner already in 2016. But I think they'd be best served focusing on the left, but I know it's great political theater for you guys and I'm sure Dean is going to be all over this.

BURNETT: Dean, I'm loving Hogan's rabid spider monkey to describe Rand Paul.

DEAN OBEIDALLAH, OPINION WRITER: That was great.

BURNETT: I mean, no offense Rand Paul. But I can see you being a rabid spider monkey.

OK. But here's the thing -- two days ago, Rand Paul was sitting right where you're sitting, full of love for Chris Christie. And I thought there is peace at last, peace in the Middle East. Here is that conversation.

(BEGIN VIDEO CLIP)

SEN. RAND PAUL (R), KENTUCKY: We can hold a grudge for a long time but want to get rid of it. I want to make up --

BURNETT: Make up with Chris Christie.

PAUL: That's right. And I've offered him a beer. We can have a beer summit. I know he's busy, I can come to New Jersey for it and I might even buy the beer, and I'm notoriously pretty cheap.

(END VIDEO CLIP)

BURNETT: All right. Now, they're both said, but here's the question -- the straight talk is who Chris Christie is. Is this going to help him get to the White House or not?

OBEDEILLAH: I think this is why people like him. And let -- you have to understand Chris Christie. I'm from Jersey, like him. My mom is Sicilian like Chris Christie's mom is Sicilian. My mom told, if you want something important, you have to fight for it.

BURNETT: So, you know if someone comes after you like a rabid spider monkey, you do not believe it when they say I'm --

OBEDEILLAH: No. you don't back down because it shows weakness. And Chris Christie is honestly sending a message. Any other Republicans going to run against him for the nomination, this is what you get if you come against me. We're going to fight all the way. I love the fact that Chris Christie is using some thing from the Republican playbook. He's using terms like college professor. That's what the Republicans use against Democrats, say they are intellectually elite and he's using that against Rand Paul and he's going with a visual argument. And this will beat intellectual every time -- you know, who give us that? Frank Luntz and the Republicans.

So, he's using Republican playbook against other Republicans. It's genius. Chris Christie is likeable for this.

Rand Paul, you know, doesn't come across as a rabid spider monkey. He comes across as a nice guy. Chris Christie will eat you up. Politics is a contact sport. There's no nice guys in this, I'm sorry, not for president.

GIDLEY: But he hasn't. He hasn't eaten him up yet. He's going tit for tat with the guy and I like that. Look --

(CROSSTALK)

GIDLEY: Listen, Dean, Camden, New Jersey, is not Camden, South Carolina. And this act (ph) might play for a while, but when he goes nuts on some conservative asking him a question, he's heard it for the third time in a day in South Carolina and he tries that act on them, he's going to be shun in a hurry because a lot of Republicans like him attacking the president. They like him attacking the press. But when that act comes to town and they see it up close, he needs to down it down a bit and be more --

OBEIDALLAH: He won't. You know, Hogan, he won't. That's who he is.

BURNETT: You didn't think he learned to realize you don't want to be too nasty in Republican primaries.

GIDLEY: Right.

OBEIDALLAH: There is a fine line between fighting for believes and a reality show and we're going to get there with Chris Christie and it couldn't go overboard where people go like you're not presidential any longer. Are you presidential?

So, Hogan is right about that, if he goes too far. But I think people, independents respond to this. He doesn't talk like a politician. He talks like a guy who believes in what he's about and won't take any gruff from anybody and that's why people from New Jersey, he's going to win 65 percent probably in November for reelection.

BURNETT: I just have an image of Chris Christie battling a rabid spider monkey and I'm sorry, it's just a funny image. Thank you, both.

OBEIDALLAH: Thanks.

BURNETT: Let us know what you think, who is winning. Still to come, America's largest annual pot festival is set to begin. So, I mean, I would never lose an opportunity to wear my favorite glasses and I'll tell you why the cops are actually bringing the snacks to this party.

(COMMERCIAL BREAK)

BURNETT: Every night, we take a look outside the day's top stories for what we call the OUTFRONT "Outtake".

So, marijuana is on the news more than ever. You've probably notice. And yet, America can't seem to come to a consensus on how it feels about pot. Maybe because America can't decide what pot is used for, because at the same time that New Jersey Governor Chris Christie was confronted by a very emotional parent begging him to legalize medical marijuana for children, to help his sick daughter, which is a very serious issue, the "Real Estate" magazine ranked the 17 cities for hippies. The two criteria related to the availability of pot. By the way, Eugene, Oregon, won.

It can be hard for people outside the culture to know what's actually being discussed even when we were talking about events that are specifically about marijuana, the 22nd -- 22nd -- annual hemp fest begins tomorrow in Seattle. Of course, it does.

This year's event is special because police will be handing out a thousand free bags of Doritos to revelers to combat the munchies. Police handing out free Doritos to people toking up. It's better than handing out tickets but it does kind of reinforce negative stereotypes at what is supposed to be a positive festival.

And then there's this show OUTFRONT, even though we discuss marijuana quite often on the program, some seriously, we've also had a tough time toking the line, balancing the light headed with the light hearted.

(BEGIN VIDEO CLIPS)

BURNETT: Do you smoke regularly, pot?

BARNEY FRANK (D), FORMER U.S. CONGRESSMAN: No, I don't. I smoke a cigar or two a day. I did have a brownie once, made me sleepy.

BURNETT: The closest I've ever came to smoking pot is these glasses, so, just for the record.

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: Well, that's the difference between you and me.

(LAUGHTER)

(END VIDEO CLIPS)

BURNETT: All right. What will it take to show pot's critics marijuana can be everything for everyone? There is probably not a missing link between hippie and healthcare, but when the smoke clears we might find the missing joint.

And speaking of weed, don't miss Dr. Sanjay Gupta's documentary this Friday at 10:00 Eastern.

"A.C. 360" starts now.