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Democrats: Obama Open To Six-Week Debt Deal; Does Default Mean "Armageddon?"; NYPD Detective Charged In Motorcycle Assault; Father Of 9-Year-Old Stowaway Pleads For Help; Dead Body in Stairwell May Be Missing Woman; Interview With Senator Tim Kaine of Virginia

Aired October 9, 2013 - 19:00   ET



ERIN BURNETT, CNN ANCHOR (voice-over): "OUTFRONT" next, let's make a deal.

OBAMA: We're going to do everything we can to get this solved.

BURNETT: But is President Obama only talking about the royal "we"?

And a woman vanishes from a hospital. She's found dead weeks later. It turns out now she may never have left.

UNIDENTIFIED MALE: What happened at our hospital is horrible.

BURNETT: Plus, a 16-year-old pop star caught in a war of words over this chart topping single, not offended. Well, find out why a very prominent blogger think she should be. Let's go OUTFRONT.

Good evening, everyone. I'm Erin Burnett. We begin OUTFRONT tonight with breaking news. A Democratic lawmaker who just left a private meeting with the president at the White House tells CNN, the president signals a more, quote, "give" on the idea of a temporary six-week deal to lift the debt ceiling. That could be significant, obviously.

Dana Bash is on Capitol Hill. I want to get straight to you, Dana. Now what have you learned, I mean, so many questions. Is the shutdown involved in this? Are we going to be in the same place we are now in six weeks? What happened?

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Unclear about the first question, probably about the second question. Look, we've been reporting since yesterday, and really even earlier, that this could be the makings of a potential deal. When I say this, this is a temporary six-week increase in the debt ceiling to give more time for negotiations.

As you said, I was told by a Democratic lawmaker who was at a meeting with the Democratic caucus of the House at the White House, that the president said that he would be open to this. He said so publicly, but it seems in private he was even more open to it. In fact, I was told that he said, if that's what Speaker Boehner needs to climb out of the tree that he's stuck in, that's something we should look at. He also made clear to Democrats, according to this lawmaker who I spoke with, that they feel that they're on firm ground right now and if they say no to this, if the speaker wants to do this, they won't be on that firm ground they are right now. So this lawmaker told me, Erin, that came away with the quote, "small measure of hope" that this does become the exit strategy.

Of course, as with everything, the devil is going to be in the details and the question is going to be if this is the road that everybody goes down, what will the parameters of the negotiations be? Because every senior Republican source I've spoken to in the House has said in order for this to work, there have to be very specific parameters for negotiations on what they would entail with regard to what Republicans are asking for.

Something that deals with reducing the debt and the deficit so that's where we are tonight. They're going to be a series of meetings tomorrow, maybe most importantly with House Republican leaders and key committee chairman, Republican chairman and the White House, and the president, I should say.

BURNETT: All, well, Dana, thank you very much. Obviously this could be significant, although again, you know, six weeks, every time we've had one of these deadlines, and then it just waits until the next deadline comes. And here we are in the same position we are in right now. One could argue, it is better to solve this now rather than wait six weeks and do it over again.

Our second story, OUTFRONT, one of the few people in the world who will actually determine what happens when and if the debt ceiling is breached. The treasury watches what he does and he is not a politician, but he does control a lot of your money, your pension, your 401(k), nearly $2 trillion worth.

He is the manager of the world's largest bond fund and he is OUTFRONT, tonight, Bill Gross, founder and co-CIO of PIMCO. Bill, always great to see have you with us. All right, I know that I am a bit jaded here, but I hear a six-week extension. I hear, wait a minute, this is bad enough now. Everyone will calm down and then we'll go through it again. What do you think about that? Is that were to even happen?

BILL GROSS, FOUNDER, PIMCO: Well, it is better than nothing. It is like a toothache. At some point, you have to go to the dentist and face up to the oral surgery, so to speak. So there has to be a resolution to the extent that it is not October 17th or some associated date, then fine. But at some point they have to get together and then solve the problem of the debt ceiling.

BURNETT: The debt ceiling itself. Now you're dealing with this every day when you do your job. And people are throwing around all kinds of allegations and charges and words. Let me just get the bottom line from you. Have you changed how you're investing due to this countdown to the debt ceiling?

GROSS: No, we haven't. You know, if the debt ceiling is postponed, it is just a question of priorities in terms of what the treasury decides to do. I mean, they have enough money basically to pay for interest. They have enough money to pay for maturities. Basically the government takes in $300 billion a month. They only pay out $40 billion in terms of interest. It is a question of prioritizing payments to bond holders and other recipients such as veterans and those are social security.

The government can pay. Are they willing to let bond holders go to the front of the line? That's the question. As a bond holder, you asked, have we changed our prioritizing in term of what we buy, you know, basically not. We believe that the possibility of a default is 500,000 to one or basically a million to one. So we continue to buy treasuries and front end treasuries that stand a chance, perhaps, of being defaulted technically in the next few weeks.

BURNETT: It would seem to me, when you make this point about prioritization though to emphasize, what you're saying is they have the money to do it and to pay the interest. If you are talking about a country keeping its full faith and credit, and keeping its word, that it would be suicidal for them to not make those interest payments to you. Therefore to people's pensions, to all the countries in the world that lend this country money and the word that's crucial is it would be a decision.

GROSS: We think so. Of course, we're bond holders and we think the front of the line is the appropriate place. I would say that the treasury market to the extent that it is a default free market basically sets the tone for the global economy. To the extent that a treasury does money good, then price of the treasury, the yield on a treasury sets the tone for the rest the financial markets around the globe and for the global economy. So if you have a default in terms of treasuries, then you have problems everywhere.

BURNETT: And let me ask you the other big news that happened today, Bill, that is obviously highly relevant, which the president formally choosing Janet Yellen to be his next fed chief. It has to go through Congress. But a lot of people say she is going to keep the controversial money spigot open so your point of view. Can she do it? Forget whether she wants to, can she?

GROSS: I think she can. There's a limit to what the fed can do in terms of writing checks at the moment for the year. They write a trillion worth of checks to buy treasuries and mortgages. Your question, can Janet Yellen continue those policies of Ben Bernanke? We think she can for a while.

If the fed tapers, as they call it or if the fed stops buying treasuries of quantitative easing becomes a thing of the past then ultimately she will have to depend on convincing investors like PIMCO and others that policy rate, that the fed funds rate of 25 basis points will be held constant for a long time.

We think she can do that. We think she is the logical successor to Ben Bernanke but ultimately, a central bank is not, does not have unlimited powers in terms of what they can do.

BURNETT: All right, well, Bill, thank you very much. We really appreciate you taking the time. You heard Bill Gross say it there. Imagine, the biggest bond fund in the world has not change his investing due to the debt ceiling and believes the government could pay that interest out regardless of what happens with the debt ceiling.

Still OUTFRONT, did poor timing of a raid in Libya cost the United States the capture of a crucial alleged terrorist.

And then another police officer may have been caught up in the confrontation between bikers and the driver of an SUV. The story gets even stranger and more disturbing. If it is true, why did not he step in to stop what was happening?

Plus an interview with a father of a 9-year-old who hop to plane to Vegas without a ticket, why his father said he will probably do it again.

And real phones have curves or at least Samsung hopes you think so. No, this isn't warped. This is the new thing.


BURNETT: Our third story, OUTFRONT, the New York Police Department goes after its own. A second officer is now being investigated for his alleged role in that violent confrontation between a group of bikers and an SUV. He was off duty. He was riding with the motorcyclists.

Now this revelation comes the day after an undercover NYPD detective was arrested for his role in the fight, he appeared in court for the first time today, that's what you're looking at, he was formally charged.

Susan Candiotti is OUTFRONT. And Susan, what happened in court today with that undercover detective? I know you broke that last night on the show that he was going there and it happened very quickly.

SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: We're finding a lot more about what he's charged with. Now we're hearing officially that he is charged with smashing the rear window of that SUV using his fist. Not only that but then kicking, kicking the SUV as well. Now, the lawyer had a lot to say. In fact, he said the video, your honor, will exonerate my client. That's what he told reporters as well.

And he said that it will prove his client was not within 12 feet of the vehicle, and furthermore, he said the wind over was already broken while his client was there. Now my sources tell me, it's just not true. In fact, the window was not broken until this man smashed it and there is video to prove it.

I have to tell you something else, too. My sources are also telling me that this officer, when he first was being questioned by authorities, implied, as they put it, that he was a detail undercover. That he wasn't off duty after all. But then they said his story shifted and well, I did see an assault but I didn't report it. Then that shifted again once authorities said, we have video evidence that you played an active role. Well, clearly through his lawyer, he said it is not true.

BURNETT: The video will prove it, but I mean, it's just amazing to me you got that undercover detective and then today the other undercover off-duty supposedly detective now under investigation. What is he specifically being accused of, do you know?

CANDIOTTI: Well, actually we're learning more about that. He has not been accused of anything. But additional information tonight, we've always said that he was being questioned and that he was in essence cooperating with authorities. I've learned that he was in fact also off duty. He was riding with the other off duty detective.

However my source tells me they have no information that he played any kind of active role in the assault. So at this point, it doesn't appear that he will be charged but we'll see what happens. However, they continue to look for those other civilian bikers. That's their main thrust right now.

And in fact we learned a few minutes ago that they have indeed arrested yet another biker and charged him with gang assault.

BURNETT: The story just gets bigger and bigger. All right, Susan, thank you very much. Susan has been breaking all those details on that story.

Now our fourth story, OUTFRONT, is a father's plea for help because tonight the father of the 9-year-old boy who hopped on a plane to Vegas without a ticket is speaking out about his son's troubled history. You may say history? He is 9 years old, but there is a pattern.

The man who did not want to be identified said he has met with doctors, with school officials, with authorities to get help for his son's behavioral issues. This makes you think of a lot of other things that have happened in this country where we don't seem to have a mental health net to help children with mental health issues. He is worried his son may pull another stunt if no one steps and helps.

Miguel Marquez is OUTFRONT.


UNIDENTIFIED MALE: We are asking for help.

MIGUEL MARQUEZ, CNN CORRESPONDENT (voice-over): In what can only be describe as a weird press conference, the tearful and disguised father of the 9-year-old boy who, without a ticket, got past through security and onto a Delta flight to Las Vegas, made a very public cry for help.

UNIDENTIFIED MALE: I don't know how my 9-year-old son, we've been asking for help. No one stepped up to help.

MARQUEZ: The man says the last he knew his rambunctious 9-year-old took out the trash. The next thing he knew for sure, his kid was in Vegas.

UNIDENTIFIED MALE: How would you let a 9-year-old child go through security check without stopping him and questioning him? How can that be? He is not a terrorist. He is a 9-year-old child. He went through screening. He boarded the plane. How is that possible?

MARQUEZ: But this seems to be a different sort of 9-year-old who comes with a history. His father says in just the last few weeks, he was suspended from school for fighting. That's when he stole a truck and there are suggestions he purposely wrecked it.

The "Minneapolis Star Tribune" found more. Four child protection assessments on the boy's family since 2012. The boy is described as challenging and claimed to investigators that his mother held a knife to his throat and seemingly fantasized that his mother was stabbed and died.

A family spokesman says the county is now offering services and programs to help an exasperated family. Here's what the father told police the last time his son got in trouble.

UNIDENTIFIED MALE: I asked the officer, please, sir, can you go upstairs with me, watch me whoop his butt. The officer told me, if I see you hit your son, we're going to have to lock you up.

MARQUEZ: A defiant 9-year-old. A family struggling to deal with him.


MARQUEZ: He was spotted on security cam video on the escalators, playing like any other 9-year-old would do before foaling with a family and getting through security barriers. They say that they may change the configuration of those barriers because of that. They also say that -- at the spokesman says that the kid may be back here in Minneapolis on Friday where I'm sure he'll be due for another whooping -- Erin.

BURNETT: All right, Miguel. Thank you very much.

Now tonight's "Money and Power." Tonight's topic is very expensive. $1010 to buy one of these things. But it's also totally and utterly knew. It's a curved smartphone made by Samsung called the Round. Now we can't test it because it's only going on sale in South Korea today but we could tell you this, that right now the Round only comes in, not black, not the new Apple color of gold, but in my recent favorite color, brown.

That's pretty sad. But anyway it has some cool little features. You can roll it to check the time and even see missed calls even if your home screen is off so it just kind of rotates. So what does the Round do for the number one rivalry in the world right now? Samsung versus Apple? Samsung shares trade in South Korea are down 9 percent this year. It needs a big move to get the needle moving for them.

Colin Gillis of BGC Financial cautions us that just because this is the first of this kind of phone hit the market doesn't mean it's going to be the best. But he says flexible display technology is the future.

And in a world where everyone asks, what tech company has a transformational idea, could the curved screen be it? I mean, this is the first thing that's really been different about these phones. Anyway, we'll see. Would you try the Round? Is it transformational? Seems pretty incredible except for one weird thing I thought of.

It sure will look and feel a little weird in your pants pocket, won't it? And then what if you sit on it and you crack it? Anyway.

Up next, a woman goes missing in a San Francisco hospital. Seventeen days later, it turns out she may have never left that hospital. Found.

Then Kaitlyn Hunt is in jail for having a sexual relationship with an underage girl. Now she feels the girl she loved set her up.

In the "Shout-Out" tonight, don't mess with the United States Coast Guard.


BURNETT: Our fifth story OUTFRONT, a woman vanishes from a hospital for 17 days. It turns out she may never have left. Fifty-seven-year- old Lynn Spalding checked herself into San Francisco General on September 19th. Two days later she disappeared. Now authorities say a body found in a stairwell at the hospital is believed to be the missing mother of two.

This is shocking. And it's shocking that it could have happened in the United States. How does a body go unnoticed in a hospital like San Francisco General for more than two weeks?

Dan -- Dan Simon is OUTFRONT.


JENNY RUAH, LYNN SPALDING'S FRIEND: I just want to know that this would never happen to anyone else.

DAN SIMON, CNN CORRESPONDENT (voice-over): Today raw emotion as friends of Lynne Spalding sharply criticize the San Francisco hospital where the 57-year-old's body was found in one of the facility's outdoor stairwells. Just how could the hospital staff not find her for 17 days?

RUAH: There are so many places around here that someone could hide or go, or be disoriented or be in harm's way.

DR. TODD MAY, CHIEF MEDICAL OFFICER, SAN FRANCISCO GENERAL: What happened at our hospital is horrible.

SIMON: An embarrassed staff could provide little in the way of real answers.

MAY: We are here to take care of patients. To heal them. To keep them safe. This has shaken us to our core. Our staff is devastated. We don't know what happened to this woman.

SIMON: Lynne Spalding, the mother of two with a thick British accent, was admitted to the hospital on September 19th for a serious infection. Two days later, she vanished from her room. Fifteen minutes after being checked on by a nurse. The family recalls her room on the fifth floor, highlighted by this box.

The red arrow showing where her body was discovered just one floor below in a fire escape. When Spalding walked through the doors to the fire escape, the hospital says they would have automatically locked behind her. The only way out would have been to find the exit to the hospital grounds.

DAVID PERRY, SPOKESMAN FOR LYNNE SPALDING'S FAMILY: We're not here to throw anyone under the bus. We're here for answers.

SIMON: A family spokesman questioning why no one apparently looked in that fire escape. He also wonders whether Spalding may have been dazed by powerful medication.

PERRY: Lynne Spalding died alone in a stairwell and her body was there for 17 days.

SIMON: A member of the hospital's engineering staff found Spalding's body. The employee doing a routine check. At this point the family spokesman says it's way too early to talk about lawsuits. They're just beginning to grieve. But it would seem the hospital still has a lot of explaining to do -- Erin.

BURNETT: All right, Dan Simon, thank you very much. Absolutely bizarre and disturbing story.

Still OUTFRONT, did the U.S. drop the ball again in Libya? Why the timing of two raids on terrorists may have cost America a chance at a very high value target.

Then open gym for Congress. New China as in plates. And tea times. This is what the shutdown looks like?

Then a blogger calls out a singer for what she calls racist lyrics. Top song in this country. Was she really listening to the same song, though?

And there was plan for "Breaking Bad." The last of the three more episodes. But the -- you know, I don't want to spoil anything. I'm just saying there was a plan. And wait until you hear about it when we go back.

And the -- sorry, "Shout-Out" tonight is drug bust on the water. I want to show you this video. It's from the U.S. Coast Guard. So you see them zooming along next to that cigarette boat. The Coast Guard response boat chasing a boat that they suspected had drugs on board. The Coast Guard crew used warning shots and disabling fire to stop the suspected smugglers after resist calls to stop. The two suspects were taken into custody. Thirty-one bales of marijuana seized.

The shout-out goes to the Coast Guard for stopping America's drug problem, or trying to, one boat at a time.


BURNETT: And welcome back to the second half of OUTFRONT.

U.S. officials confirmed to CNN, after a bit of backtracking, that military aid to Egypt will, in fact, be cut. The U.S. is cutting $260 million in cash and also halting delivery of F-16s, Apache helicopters, harpoon missiles and tank parts. It all adds up to about $500 million, which is nearly half of the $1.3 billion in annual military aid the United States gives Egypt.

Now, a lot of people have been asking why the United States hasn't cut off aid to Egypt as hundreds if not thousands have been killed in violent clashes with the interim government which forcibly removed Egypt's controversial president from power.

Now, Saudi Arabia, the United Arab Emirates and Kuwait have pledged at least $14 billion in aid combined, according to Egyptian media. Now, that's a lot of money. It dwarfs the U.S. military aid. Sure, that might help the government consolidate power, but it's important to note, it seems it cannot be used for Egypt really wants on the military side, which is American weapons, American helicopters, American guns, American planes and American parts for their tanks.

Well, Kaitlyn Hunt, the 19-year-old who is arrested in Florida over a sexual relationship she had with the 14-year-old girl is speaking out from jail. She is currently serving a four-month sentence under a plea deal. Now, you see her here. She is wearing an orange jump suit. She talked to our affiliate WPTV and said, she didn't understand why she was in trouble. She says the girl was the person she once confided in. But she now actually believes that that girl put her away.


KAITLYN HUNT, SERVING FOUR MONTHS IN JAIL UNDER PLEA DEAL: I care about her as a person. It is someone I dated for a long time but I don't love her the way I did before.


BURNETT: Hunt is relieved that this is almost behind her. After jail, she will be under house arrest for two years.

Well, "Breaking Bad" is sill in the headlines and apparently so addictive that "Variety" magazine reports that even DreamWorks CEO Jeffrey Katzenberg offered to pay, get ready for this, $75 million for three episodes. That is an incredible amount of money considering each episode only costs about $3.5 million to make.

Now, the idea was to roll the episodes online in small snippets over 30 days. Now, "Variety's" Leo (INAUDIBLE) tells us he spoke with Katzenberg tonight. And Katzenberg said his ideas simply came too late, that the final episode had already been shot. And even now, there is half-hearted talk about whether "Breaking Bad" can still be revived. I don't want to be a spoiler here, people, but I really do not believe that that is possible.

All right. Our sixth story OUTFRONT: dropping the ball on Libya. The U.S. military may have had plans to seize two high profile targets, two, including the militia leader behind the attacks on the American consulate in which four Americans were murdered in the Benghazi a year ago.

But it didn't happen. The raid in Tripoli that captured Abu Anas al Libi was supposed to remain secret for several days. But, obviously, it didn't. And now, a prime suspect in the Benghazi attack, Ahmed Abu Khattala may have gone into hiding.

OUTFRONT tonight, Nic Robertson, who's in Tripoli live with the latest.

Nic, obviously, you are in the place to be. And obviously, it seems, you know, it could possibly have been a bit of incompetence here on the part of planners. I mean, how did this go so wrong?

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: You know, it's hard to say how it went wrong. But, first, we've got to say it's pretty incredible that a guy like Abu Anas al Libi could be lifted from his home where he lives with his wife and grown sons ands have the family say nothing for several days given that they know his background.

So, the fact that people remain quiet for a while is kind of surprising.

Abu Khattala in Benghazi, suspected of being behind the murder of U.S. Ambassador Chris Stevens, we're told to people to close in, he has the feeling that no one is going to pick him up right now. Because of what's happened in Tripoli, the lifting of al Libi, he feels that he is pretty safe right now.

I talk as well earlier to the justice minister here. And he is very clear. He says the United States has no authority to come in for a second arrest. Indeed, he said it would be very damaging for the government, Erin.

BURNETT: Right. Well, Nic, I know Abu Khattala, of course, spoken to our Arwa Damon, as part of our documentary on Benghazi. And at that time, you know, he hadn't talk to anyone, hadn't been debriefed by any U.S. intelligence but was willing to talk to journalists.

What are these operations in the fallout say about the Libyan government, such that it is? And I know that's probably a generous word to describe it. But how much the United States can rely on Libyans for cooperation?

ROBERTSON: You know, I put that precisely to the justice minister here a couple hours ago. I said, could you arrest Abu Khattala right now? He said, no, he couldn't. When? He, well, I could do it soon. How soon? Well, not tonight but hopefully very soon.

The bottom line here is, the government doesn't have a national security institution. It doesn't have a national army. It doesn't have a national police.

Its reach of law doesn't go Benghazi. In fact, listen to the gunfire behind me here. It doesn't go very far in this city at all. Crime is on the rise in the country.

So, the bottom line for the government is, they're not going on get out and arrest him any time soon. I asked the justice minister. Is this country Libya, a failed state? And he said, it's close to being a failed state. He hopes the government can turn it around.

But that's the reality. Even the leaders in this country realize that Libya is in a very, very precarious position, Erin.

BURNETT: All right. Nic Robertson, thank you very much, reporting live from Tripoli. And I think it says it all there about what the situation is when he is there on a regular night and you can still hear gunfire.

Well, our seventh story OUTFRONT: Washington double speak.

Throughout the shutdown mess, the White House has repeatedly said the president would reject any efforts to fun the government piecemeal.

Here's Jay Carney earlier today.


JAY CARNEY, WHITE HOUSE PRESS SECRETARY: This piecemeal approach is gimmickry and it's irresponsible. The solution to all of this is not the piecemeal reaction to them, or, you know, a band-aid approach to solving them.


BURNETT: Except that sometimes piecemeal approaches have worked for the White House. In the same briefing, Carney told reporters, the president would make sure that families of fallen U.S. soldiers would receive death benefits.


CARNEY: The president expects this to be fixed today.


CARNEY: Correct.

ACOSTA: He's expected to resolve --

CARNEY: That's what the president expects. He was not pleased to learn of this problem. And he has directed the OMB and his lawyers to find a solution and he expects to have one today. (END VIDEO CLIP)

BURNETT: All right. The problem was fix. The Pentagon reached an agreement with a charity that was going to pay the money owed to the military families until the government is reopened. The House voted unanimously to ensure that those benefits are going to be restored.

Now, no one can, would or should argue with the fact that the families of the fallen troops deserve the funds and they deserve them immediately. The question is, though, a broader one -- is the White House sending mixed messages?

OUTFRONT tonight, Virginia's Democratic Senator Tim Kaine, member of the Senate Armed Services Committee.

Good to see you, Senator. Really appreciate it.

SEN. TIM KAINE (D), VIRGINIA: You bet, Erin.

BURNETT: Now, the White House has repeatedly said, look, they don't want to do this in a piecemeal fashion. But, obviously, that is what's happening on some level. Is the president talking out of both sides of his mouth?

KAINE: You know, I don't think so, Erin. Look, I think when we acted earlier, and I can't remember, my days are running together, whether it was last week or over the weekend, to do the military pay. A lot of us thought this had been taken care of.

And when it became clear that it was at least ambiguous or that it wasn't clear, I'm really glad Secretary Hagel stepped in. I'm glad the House did what they did. These benefits are benefits that should be paid.

But the bigger picture is this, that I do think the White House is right that you can't let people shut down the whole government and then selectively decide what they want to reopen, because if you do that, you're going to have a shutdown every year. People who cannot get what they want, who refuse a budget negotiation, will shut the entire government down and then they'll decide who they want to let up off the mat and that's just no way to run the government of the greatest nation on earth.

BURNETT: And what about this deal reported on tonight? Our Dana Bash was just saying, one of the Democratic lawmakers, who just met with the president this afternoon, left and said, they fell the president was more willing to give in terms of a temporary deal.

Now, temporary deal would be in the debt ceiling, unclear if the shutdown is involved. Six weeks.

I hear this and I have to say, I don't know. I get frustrated, right? Because every time, I'm sure you do, too, right?


BURNETT: Every time there is a little stall, whether it is six weeks or 18 months, we end up right where we are right. So --

KAINE: Well --

BURNETT: Yes, go ahead.

KAINE: Yes, I'll say this to you, Erin. I think we all know that at a minimum, this is going to be a two-step process. If you do a debt ceiling in C.R., as we want to do, we acknowledge there's still -- we're still going to have to come back to do the budget deal for 2014 at a minimum, maybe even a broader one to deal with the sequester. So, there's going to be two steps.


KAINE: So that the first might be six or might be eight weeks. That's understood. What we need to do is reopen government and affirm that America will honor its debts. But then we need to get into a budget negotiation that the Senate has been trying to do since the 26th of March.

BURNETT: And let me ask but what Paul Ryan wrote today. I'm sure you saw his "Wall Street Journal" op-ed.

KAINE: I did.

BURNETT: You know, saying, look, the stalemate can end because both parties can agree on the need for entitlement and tax reform. You know, he noted a stunning statistic that you know well, right? Entitlement spending is expected to go 79 percent over the next 10 years. He suggested that could be changed with things like increasing the retirement age. And I know plenty of Democrats who agree with that.

Are you open to making a deal that would include those kinds of things? So, we're dealing with the big problems.

KAINE: Erin, when I saw that article by Paul Ryan, I just was -- you've got to be kidding me. We pass ad budget in the Senate in March that basically put a number in for entitlement reform that we want to find savings with entitlement reforms, and we've been trying to go to a conference with the House since the 26th of March and they've been blocking it.

Every time we've tried, we don't want a conference because we don't want to compromise. What they wanted was a confrontation. Not a compromise. And, as you know, less than three hours after they shut government down, they then sent across. OK, now, we're ready to sit down and have a conference, but not about the budget. We want to have a conference over what are the conditions under which we will allow the government of the United States to reopen.

But look, at any point, a compromise and a conference is a good idea. If they finally come to it after six and a half months, of course, we want to sit down and do it.

But there is no reason to keep all these people laid off, private contractors. I met with a bunch of employees and private contractors in my office today, they're all laid off, furloughed. They're all worried about their paychecks.


KAINE: Why would we keep them laid off? They can come back and we can negotiate.

BURNETT: All right. Thank you very much, Senator Kaine. Appreciate your time.

And our eighth story OUTFRONT: pumping iron.

The government shutdown may have shut down some things around the country, but rest assured, lawmakers still get to go to their taxpayers subsidized gym on Capitol Hill, that members of Congress themselves apparently are outraged that this is happening.


REP. EARL BLUMENAUER (D), OREGON: Well, it's true. It doesn't cost very much. But it costs. The electricity, the hot water, the towels, they're not provided by gym fairies, they're provided by taxpayers.


BURNETT: It turns out it is not just the Capitol gym.

OUTFRONT tonight, Tom Foreman.

And, Tom, you know, it's already hard for people to understand when you have a shutdown and you can bring back 50 percent of the people who are furloughed overnight and not really explain why, but there are other things that would shock people that are exempt from the shutdown.

TOM FOREMAN, CNN CORRESPONDENT: Yes, if you want to take a hike right now, Erin, if you want to go to a national park or you want to peek at a Picasso at a National Museum or, you want to visit a historic site like a battlefield under the government's control, you can't do it. The shutdown has put all of this off-limits. In many cases, there are barricades, signs, and even guards telling to you stay away as if these places are radioactive.

However, if you've an outdoorsy type and you want to play a round of golf, like the president and his pals, you can tee it up where the commander-in-chief likes to golf -- no, he's not playing out there right now, but the golf course at Andrews Air Force Base is still swinging, because even though it is clearly a federal facility, officials say it is operating on budget not appropriated by Congress -- so that's open.

Let's say you want to protest something. The National Mall, also federal property, hosted an immigration rights rally earlier this week, which was a huge kerfuffle. The Park Service defended it saying it allowed this activity while shutting down many others by saying this was a First Amendment matter. These people had something to say.

Although by that rationale, I would think you could go hiking through Yellowstone as long as you carried a sign and complained about global warming or something. You could say it's my First Amendment rights.

And as you mentioned, if you're a member of Congress, you want to work out your shutdown frustration, yes, you can trot down to these doors. The taxpayer subsidized Capitol Hill gym, because while the staff there is gone, John Boehner's buddies on the Hill and the Democrats too, can all go work out and grab a shower and trust me, their memberships are lot cheaper than anything you'll find in your neighborhood, Erin.

So, you can see there's close and then there's kind of closed, depending on where you are.

BURNETT: And what about -- we've all been hearing about the crystal glasses that the State Department was purchasing at the time of the shutdown which might have upset people when we have issues with embassy security, that they would be buying the crystal anyway -- but on top of the shutdown.

So, what's going on with that?

FOREMAN: Well, the State Department did indeed place an order for between $25,000 and $5 million crystal glasses to be delivered over the next five years. This was done just ahead of the shutdown, and the glasses are coming from an American company to be used in diplomatic missions around the world so there are jobs being created.

Still, the fact this contract squeaked in just as the government was striking to a halt does have a let them eat cake quality to it, and the optics for all of that crystal, I will assure you, are not that great, Erin.

BURNETT: Well -- all right. Thank you very much, Tom Foreman.

Still OUTFRONT: a story straight out of Hollywood. A pilot of a plane falls sick. An untrained passenger has to land with it someone on the ground trying to tell him what to do. This was real life and we'll show it to you.

And then the number one song on the charts in the U.S. Is it racist?


BURNETT: We're back with tonight's "Outer Circle".

Tonight, we start in England where a passenger was forced to land a small plane after the pilot fell ill. He had never landed a plane before. Can you just imagine this?

I asked Erin McLaughlin how he did it.

(BEGIN VIDEO CLIP) ERIN MCLAUGHLIN, CNN INTERNATIONAL CORRESPONDENT: Erin, it's every passenger's nightmare. The pilot falls ill and the passenger who has no idea how to fly the plane is forced to take the controls.

Well, that's exactly what happened to 77-year-old John Wildly over Humberside, England, on Tuesday evening. They call in two flight instructors to talk him through, how to safely land the two-seater Cessna. Wildly says he was absolutely terrified. At one point, he thinks the plane even stalled. He flew over the airport multiple times before finally landing the aircraft in complete darkness.

Now, sadly, the pilot later died, due to his illness. Wildly says that despite the traumatic experience, he'd be willing to fly again -- Erin.


BURNETT: Our thanks to Erin.

And now, I want to go to China, a jaw-dropping story about a 2-year- old boy that had a fetus removed from his stomach. This is something you must see to believe.

Pauline Chiou has the details.


PAULINE CHIOU, CNN INTERNATIONAL CORRESPONDENT: Erin, a 2-year-old Chinese boy under went surgery to essentially remove a twin who developed inside him. You heard that right. Doctors were stocked to discover an undeveloped fetus inside his stomach. The phenomenon is called fetus in fetu, a rare occurrence when the twin is absorbed into the other twin while in the womb.

According to published reports, 2-year-old Xiao Fang (ph) was taken to the hospital after his stomach became so enlarged he was having difficulty breathing. X-rays and MRI scans revealed Fang was carrying the undeveloped fetus of his conjoined twin inside his swollen stomach. The fetus was nearly 8 inches wide and had developed a spine, fingers and toes, according to news reports. It did not survive.

The West China Hospital has confirmed to CNN that the boy recovered and has checked out of the hospital -- Erin.


BURNETT: That is one of the most disturbing stories I have ever heard.

And now, let's check in with Anderson Cooper with a look at what's coming up on "AC360" story. It's a pretty disturbing story. I'm sorry to put it right in front of you.


BURNETT: I'm sorry to do that to you.


COOPER: No, yes, I never heard of that. Erin, thanks very much.

We're keeping them honest. Lawmakers have publicly shown shock and dismay the families of fallen soldiers aren't getting death benefits because the government shut down, but here is what shocked us. Congress is warned specifically, warned publicly, warned that this was going to happen and it did. We're keeping them honest tonight.

Also ahead, accident or murder? Really happened to this young man Kendrick Johnson? His death in a high school gym was tragic. The circumstances surrounding it have his family now demanding answers. Tonight, disturbing details what happened somewhere between the autopsy and funeral home.

A lot more to come, Erin, all at the top of the hour.

BURNETT: Our ninth story out front, royals, racism or just a number one hit song? The debut single "Royals" is the top hit on the 100 chart, number one on Spotify, and it is the most shared song in the United States this year. That's a pretty impressive ensemble but the New Zealand artist known was Lorde is under fire after a prominent feminist blogger criticized the singer, who is 16 years old for singing racist lyrics. Listen to yourself.


BURNETT: OUTFRONT tonight, "Showbiz Tonight's" A.J. Hammer.

Now, A.J., song is a huge hit. It's been out since March and just in case anyone couldn't hear the lyrics there, this is partly what it said, "But every song's like gold teeth, grey goose, tripping in the bathroom, blood stains, ball gowns, trashing the hotel rooms, we don't care, we're driving Cadillacs in our dreams."

Why the outrage?

A.J. HAMMER, SHOWBIZ TONIGHT: Well, it's basically stemming from the fact that there is this feminist blogger who wrote a column about it, calling out Lorde, saying that these lyrics are racist, and it really got traction, not so much necessarily because of the column itself but all of the responses. So many of Lorde's fans have gone online to defend Lorde and say, what are you talking about?

Let me read a bit of what this blogger Veronica Bayetti Flores by said in her blog. She said, "While I love a good critique of wealth accumulation and inequity, this song is not one. In fact, it's deeply racist because we all know who she's thinking about when we're talking gold teeth, Cristal and Maybachs."

The blogger basically suggesting that Lorde is calling out hip-hop artists who, of course, are known to name drop items like these in their lyrics. BURNETT: Right. Now, of course, that's an American way of looking at things, though, that -- you know, as an American, you'd say, oh, well, in those videos, that's what they do. But she's a 16-year-old from New Zealand. Do you think race had anything to do with it?

HAMMER: I don't think so at all. I think it's a huge stretch. I think this is her frame of preference. She grew up listening to hip- hop and let's face it, Aerosmith, the Rolling Stones, the Black Keys, they're not singing about these things.

The music that she listens to, that Lorde listens to, this is what they are talking about. It was only natural for her to drop them.

She also sings about jet planes, islands, tigers on a gold leash. It's consumerism that she's really calling out.

BURNETT: That sounds like a Russian oligarch. But --

HAMMER: About anything else.

Yes, quite frankly, I'm surprised by it. There are people out there on social media defending this blogger and saying, yes, you have a point there. If you look really, really deep into it maybe you can find something but that's not at all the intention here and I don't think that's what is at play.

BURNETT: And as you mentioned, the blogger, her name is Veronica. She sent a statement today to CNN, and it said, you know, she's pushing back on people here, saying, "This is racism, not just a casual encounter or a specific instance of interpersonal prejudice. It's an entire system that requires the consistent reinforcement and dehumanization of people of color to uphold."

Now, she could be right but perhaps not intended racism?

HAMMER: I don't even see it that way but there is a lot of music this blogger would have to go after. There was a huge song by Jessie Jay last year, a white English singer who was singing about music and how now today it's all about these are the lyrics, low blows and video hoes. You know, she wants to harken back to a time when it was more simple and about peace and smiling and love and not about bling.

It's part about pop culture and music is all about. Direct racism, I don't think see it at all?

BURNETT: If you're looking for offensive lyrics in songs unfortunately.

HAMMER: There are a lot of places to go.

BURNETT: All right. Our thanks to A.J.

We will be right back.

(COMMERCIAL BREAK) BURNETT: Thanks as always so much for joining us. We'll be back here same time, same night, hoping for a miracle in Washington because, you know, miracles sometimes happen even when they do involve politicians.

"AC 360" starts right now.