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Erin Burnett Outfront

Mitt Romney's Jobs Promise; Elitist Image; Al Qaeda Suspects Arrested

Aired August 02, 2012 - 19:00   ET

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

ERIN BURNETT, HOST: OUTFRONT next the top adviser thinks Mitt Romney's economic plan will add 12 million jobs in his first term, so of course we did the math (INAUDIBLE) add up.

And a story we have been following closely, the rise of al Qaeda, tonight new evidence.

And could the Colorado movie theater shooter -- theater shooting have been avoided? The warning signs and when a psychiatrist needs to ignore doctor-patient privilege a crucial question. Let's go OUTFRONT.

Well good evening. I'm Erin Burnett. OUTFRONT tonight Mitt makes a very bold promise, 12 million jobs. So take a look at this op-ed in "The Wall Street Journal" written by Romney's top economic adviser Glenn Hubbard. First of all I just want to draw your attention to the cartoon. There is Obama on a tortoise with a whip and Romney on a horse skipping (ph) so fast that his tie and horsetail are flying in the wind.

Once you get past this butchering of Egypt's famous fable, I mean what was it supposed to do -- be the tortoise and the hare or the tortoise and Mitt's dressage horse, the one who competed today in the Olympic? All right, the newspaper denying the catchy cartoon but every word in the op-ed was written by Glenn Hubbard and here in the second to last paragraph is the claim.

President Romney would create about 12 million new jobs in his first term and millions more after that. Which means -- OK just to get to the 12 million in the first term -- 250,000 jobs each and every single one of his 48 months in office. Now he says he's going to do that by cutting regulations and cutting taxes. But does it add up?

First the good news because we like to be a glass half full kind of show, there have been a few times in American history where this has happened. The chief U.S. economists of JPMorgan notes it happened in the mid 1990s and of course then we were in the middle of the Internet boom, which was not sustainable and ended up bursting. That is where the good news ends for the Romney jobs claim.

Since 1939, according to Bespoke Research, only 27 percent of monthly jobs reports have shown growth of 250,000 jobs or more. Bespoke Research also notes the United States has never had four straight years where job creation was above a quarter million a month. In fact the longest stretch was only 11 months during the Reagan years, September of 1983 until July of 1984. And then there is this reality.

Even if Mitt Romney created 12 million jobs we would still be in the hole. Here is why. This country needs to create about 125,000 jobs a month just to keep up with population growth. And we are talking about you know things like young people entering the workforce. That totals to six million jobs needed in a four-year term, so that just keeps you even with demographics. And then there is the situation we are in.

JPMorgan estimates that we need up to eight million jobs to make up for the people who lost jobs during the financial crisis and still don't have them and the people who have completely given up even trying for a job but would come back to look for work as soon as the economy turned up. OK, the bottom line on the math Mitt Romney needs to create 14 million jobs in his first term just to get us back to even. That is pretty grim.

Twelve is hard to get to and 12 isn't even enough and here's the final point. It may not even matter who is president come January. Great jobs booms come with great moments. You know like the tech boom in the 1990s. We're actually on the cusp right now of a possibly massive boom in energy, jobs and wealth. We're likely to be energy independent in a few years.

That could create a lot of jobs no matter who is in the White House, but the question is aside from something like that will Mitt's policies deliver the magic 12 million number when history shows it is a very tall order. OUTFRONT tonight Paul Hickey is the co-founder of Bespoke Investment and Research. Alex Brill, research fellow at the American Enterprise Institute and Michael Ettlinger, vice president for Economic Policy and American Progress.

OK, great to see both of you, really all of you and really appreciate your taking the time. Let me start with you, Paul. This claim of 12 million jobs. You spent a lot of time looking at the history; obviously some of the research they were studying was yours. It's a really tall order.

PAUL HICKEY, CO-FOUNDER, BESPOKE INVESTMENT GROUP: It is a very tall order and if you look the last time we had it was back in the '90s and think about what's happened since the '90s. We've had a Republican in office. We've had a Democrat in office. We've had different control of Congress by both parties.

And getting back to your point, it's not necessarily the person who is in office that creates the jobs. It is a lot of the -- it's what goes on around the economy. (INAUDIBLE) what the president does is helps foster that growth and support it or not support it. And you know on both sides of the aisle you have an argument that either President Obama is anti-business or on the other side of the aisle you have Mr. Romney is pro-business. So it's, you know it's one of the things where we have a lot of unsure, the economy --

BURNETT: Right.

HICKEY: -- unsure now and it just -- it creates a lot of confusion.

BURNETT: A lot of partisan point of view. Alex, let me ask you this question though. When he puts out specific numbers, this is tough because people want specific numbers, right, from people running for president. But does he box himself into a corner with that 12- million number? I'm just thinking about Barack Obama's promise, the now infamous promise of hey if you take my stimulus the unemployment rate will never go above eight percent and then obviously shortly thereafter it peaked at 10 percent. He has never gotten over that.

ALEX BRILL, RESEARCH FELLOW AT THE AMERICAN ENTERPRISE INSTITUTE: Well that is right. There is certainly a risk and the experience of current President Obama. You know now we can't get below eight percent and he promised not to go above that number, so there is that risk for Governor Romney. And so the question really is, is exactly as you posed it I think is how big a claim is this? You know how close to this could we get if we had a strong economic growth?

I agree with what Paul said. It is not just about the president's policies but the president's policies, what Congress does, that leadership I think is a contributing factor. I believe that some of the policies that you know outlined in that op-ed that you were pointing to, other things that Governor Romney said on the campaign trail are consistent with promoting economic growth, getting us in that direction. I think tax reform alone creating a level playing field, lowering marginal tax rates, not by cutting taxes -- actually you're revenue neutral tax reform is the kind of change that a president could advocate that would be consistent with creating more jobs.

BURNETT: Revenue neutral tax reform I know is a whole another can of worms, which we started on yesterday. We're going to keep doing much more on that because I know that's a very big question. But Michael, let me ask you this. You know Barack Obama is not thought of by most Americans as someone who has created jobs. He just isn't and he is still in the hole net-net. He hasn't created as many as were lost early in his term. But he still has added 4.4 million private sector jobs. I think that would surprise a lot of people and I guess I'm sort of making the argument, I mean once you start going you know you can really create a lot of jobs.

MICHAEL ETTLINGER, VICE PRESIDENT FOR ECONOMIC POLICY, AMERICAN PROGRESS: Yes. I mean I actually don't think that there is any problem with the target that Governor Romney has set or that Glenn Hubbard has set. Yes, we've actually had many months in this recovery where we have created more than 200,000 private sector jobs --

BURNETT: Six months, right, Paul?

HICKEY: Yes, six months, just about half of the historical average.

ETTLINGER: Yes.

HICKEY: So historically you have about 40 percent (INAUDIBLE) have over 200,000, so far during this -- during President Obama's term we've had about half that rate.

BURNETT: OK, go ahead Michael, sorry.

ETTLINGER: So yes, so I mean yes Paul is right and it's been six months and you know since we hit the bottom and since President Obama's policies started having an impact in the middle of 2009, as you said, we've created millions and millions of private sector jobs. So I guess my main point is I don't have an objection to Romney saying he wants to create 12 million jobs. I just think you know to answer Alex, I think his policies just aren't aiming at the target.

And I think that is a much bigger problem. I think his policies are very -- remind us of President Bush's policies and they were failures in terms of creating growth and job creation. And it's not surprising Glenn Hubbard was of course President Bush's top economics guy at the time the Bush tax cuts passed. And he promised an economic miracle then and he is doing the same now which isn't all that surprising.

BURNETT: Well, Alex, what I'm curious about is you know he is putting this 12 million number out which sort of seems you know you kind of lick your finger and you put it in the air. I mean it's, you know (INAUDIBLE) informed, but that's kind of what it is. And he is betting on this whole tax reform (INAUDIBLE) being neutral, which you brought up. And I'm curious how in the world he gets there. So he cuts taxes for wealthy Americans and he says for everybody else, but he's going to broaden the base. So people who earn the least money are going to start paying taxes for the first time. How in the world will what they pay makes up for giving everybody else a 20 percent tax cut because it seems like his whole argument rests on that being true?

BRILL: That is actually not how I would describe the framework of the tax reform plan that I've heard him describe. When he says tax -- revenue neutral tax reform and lowering tax rates and if your question is how is that possible it's -- we need to keep in mind that only some of the dollars that we earn today are actually taxed by the tax code. Obviously we have a -- you know a system that is very progressive. A lot of low and moderate income individuals that don't pay federal income tax.

BURNETT: Right.

BRILL: But even well-to-do Americans are claiming tremendous numbers of deductions. Home mortgage interest deduction would be one. State and local would be another. By reforming some of these -- we call them tax expenditures -- by reforming or repealing some of these tax expenditures we can broaden the tax base which permits us to lower the rates. This is what we saw in the Simpson/Bowles Commission report on tax reform and this is -- what is the framework that I understand that Governor Romney is promoting.

BURNETT: All right, well hopefully he will come out with some specifics on which of those he would close. Obviously closing the mortgage interest deduction, a lot of people might hate him for it, but it might be -- it might be what he is going to do and it might be the right thing to do. Thanks to all of you. We appreciate it. And OUTFRONT next, an attack on Mitt Romney straight from -- yes -- not the tortoise's mouth, the horse's mouth. And you thought it's been a bad few months for Facebook, well it got worse today.

And there's panic in Taiwan tonight. These are images that we have for you that are truly stunning. We're going to show them to you.

(COMMERCIAL BREAK)

BURNETT: Our second story OUTFRONT "Dressage Day" at the Olympics and Mitt Romney's horse was front and center. Rafalca -- sounds like some kind of a vegetable that was not very good -- and her rider danced their way into 13th place, but you know what, that does not mean that Rafalca is out. She may be in. They're going to find out tomorrow if they move to the next round. Now dressage of course is an expensive sport. The liberal group MoveOn.org has picked on this and they wants voters in swing states to hear negative things about dressage.

(BEGIN VIDEO CLIP)

POLITICAL AD: My name is Rafalca, the Romney's dressage horse. You might have seen me executing legues (ph) and drying changes. How do I pull off such grace and athleticism while looking so good? Maybe it's because the Romneys spend $77,000 a year on my upkeep and after Mitt Romney repeals health care and ships your job overseas I dare say your life will not be nearly as pampered as mine.

(END VIDEO CLIP)

BURNETT: So ridiculous, just to be laughable and of course it's true. The Romneys have an expensive horse, but you know what, move on. You are spending five figures on that add. They admitted that. By the way, they wouldn't say whether the five figures was $10,000 or maybe $70,000, of course like the Romney's horse which they say is greater than the average American income. Interesting they wouldn't disclose the cost of the ad. John Avlon, Michael Waldman and Leslie Sanchez all join me now. I mean that really does take the cake or take the -- I don't know what the right dressage term would be.

(CROSSTALK)

BURNETT: All right, Michael Waldman, does this kind of thing work for anything other than it could fall (ph)?

MICHAEL WALDMAN, BRENNAN CENTER FOR JUSTICE, NYU: Look it is a funny ad, but it's making a very serious political point. For decades the Republicans have been very successful of coupling what one might call elitist economics, in other words focusing tax cuts of the high end with populous social approach, with a social populism. Think of how they went after poor ole John Kerry with his wind surfing. This is the first time that we have kind of an upper crust economics coupled with very traditional aristocratic --

BURNETT: You're saying it's OK when you are a limo liberal -- (CROSSTALK)

BURNETT: -- but not when you are a Republican?

(CROSSTALK)

JOHN AVLON, CNN CONTRIBUTOR: Dressage makes wind surfing look like the national past time. I mean that's the problem here, right? The reason these negative narratives work is if they rip off reality. And in this case you have the unfortunate coincidence of the Romney's horse in the Olympics. And the key number in that ad is not just (INAUDIBLE) the talking horse, you know (INAUDIBLE) it is $77,000. When all of a sudden people hear that and say you know that is average -- larger than the average American household income that becomes serious as well as funny and that's why there's a serious point --

BURNETT: OK, although I'm frustrated MoveOn.org wouldn't say how much they spent for the ad.

(CROSSTALK)

BURNETT: I mean really. All right, Leslie, though, what about this though?

(CROSSTALK)

BURNETT: Mitt Romney -- go ahead.

LESLIE SANCHEZ, REPUBLICAN STRATEGIST: This is so frustrating. Not only is it a double standard but do you hear this? It is ridiculous. I mean Jacqueline Kennedy made Middleburg (ph) the Washington retreat so she could ride thoroughbreds and it was glamorous and elegant according to the media. Lyndon Johnson gave Caroline a pony named "Macaroni" and it was adorable. But here in this case Ann Romney rides these horses as part of her physical therapy for MS and we're actually challenging this and talking and using it in an ad. It's just -- it's not really what politics should be about. I think it's frustrating and it's deceptive.

WALDMAN: Look, in this country we say that every politician says they were born in a log cabin that they built themselves. People love --

BURNETT: Not everybody is lucky enough to actually have been born in Hope, Arkansas.

WALDMAN: People --

BURNETT: -- like one individual.

WALDMAN: Right. People love success.

BURNETT: Yes.

WALDMAN: They respect success and they're even willing to elect wealthy people, Nelson Rockefeller, John Kennedy -- BURNETT: Yes.

AVLON: Sure.

WALDMAN: But they want those people to be fighting for them. And the problem here is that the Democrats are simultaneously making the argument about taxes and economic policy.

BURNETT: Right.

WALDMAN: And that's what makes it much harder and I will make a confession on national television. Until two weeks ago I did not know there was such a sport as dressage, so I'm not really --

(CROSSTALK)

BURNETT: I'm still not sure exactly what it is.

(CROSSTALK)

BURNETT: It sounds like dress your horse up with those little white --

AVLON: It's horse dancing.

BURNETT: -- those really like leg warmers, you know --

(CROSSTALK)

BURNETT: But OK, (INAUDIBLE) because I want to get to something Mitt Romney said tonight that was unbelievable. Quickly though, John, it does seem (INAUDIBLE) double standard. Mitt Romney is in Aspen. He's got this dressage horse. Barack Obama raises money from the private equity titans while slamming Mitt Romney for being a private equity guy.

UNIDENTIFIED MALE: Yes.

BURNETT: And yet he doesn't get the same elitist label.

AVLON: Yes, even worse the Anna Wintour fundraiser which is about the most tone deaf thing you can do as a Democrat imaginable.

BURNETT: Yes.

AVLON: It does stick and again though it does rip off these larger narratives and stereotypes and --

BURNETT: Right.

AVLON: -- the facts of his extraordinary success in private equity.

BURNETT: All right, so now I want to get to this. I'm very excited. This is something that Mitt Romney has just said. So Harry Reid came out and you know as you all may know and he is saying that somebody called him and said that Romney didn't pay taxes for 10 years and Harry Reid has been saying it a lot. Well guess what, it got Mitt mad.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: It's time for Harry to put up or shut up. Harry is going to have to describe who it is he spoke with because of course that is totally and completely wrong. It's untrue, dishonest and inaccurate. It is wrong. So I'm looking forward to have Harry reveal his sources and we'll probably find out it is the White House.

(END VIDEO CLIP)

BURNETT: I guess you would say to Mitt Romney, too, put up or shut up. If you had just put your taxes out Harry Reid would have to quote, unquote "shut up."

WALDMAN: This is a classic political trap for him to respond in that way and you know because he hasn't put the taxes out there is nothing preventing his opponents from bringing it up in new and creative ways, so he is in a bit of a political spot here that may last until November.

BURNETT: You know what Mitt, if they are wrong, wow, it's going to be great. Put them out and you're going to be the high horse.

(CROSSTALK)

BURNETT: I'm sorry. I didn't mean to do it.

SANCHEZ: We didn't really say that.

(LAUGHTER)

BURNETT: All right still OUTFRONT you heard last night on this show breaking news that the psychiatrist treating the alleged shooter in the Aurora massacre went to authorities and tried to warn them that her patient had been threatening horrible things. Why did the warnings not produce action? And the cost of watching the Olympics in dollars.

(COMMERCIAL BREAK)

BURNETT: Well the London Olympics are creating some interesting problems because of the time difference as you're now aware, most Olympic events take place while a lot of Americans are in the office. So for those who don't want to wait until prime time, NBC has been streaming the events live online and a lot of people are watching at work, which has created a problem in Los Angeles specifically where City Hall workers have been asked to stop streaming the Olympics because it could effect city operations.

Wow, it's not just Los Angeles though. Captivate Network (ph) estimates that American companies will lose $1.4 billion of productivity during the Olympics. I mean that's a lot on money and we have to, say come on, I mean you know you're at work. You're getting paid to do your job. You don't need to watch the Olympics. I know it tempting but you are getting paid to do your job.

But you know that's not really what bothered us today. What bothered us today was a report that came out of Bloomberg which said that the Pentagon's Missile Defense Agency actually had to send a memo to employees telling them to stop using their computers to watch porn. That's right. The people who control this country's missile defense are using their computers at work to watch porn.

I wish they were just watching the Olympics. Some of them actually downloaded material from sites that were known to have viruses or malware and the number tonight is 25 because that is the average number of threats found on a porn site that has been infected according to Symantec. Now sure some of the threats are more annoying, but here is the real risk. If just one of those sites has a virus that can access top secret files, which is the way a lot of our rivals on the global stage try to get into our nation's infrastructure, we could see a massive breach of our nation's missile defense. What a terrifying thing and we thought worthwhile to bring to your attention.

Well next Facebook has had a rough time lately but tonight something (INAUDIBLE) not like and the rise of al Qaeda, there's details of a new bomb plot today and what it means to the future (ph).

(COMMERCIAL BREAK)

BURNETT: We start the second half of our show with stories we care about where we focus on our reporting from the front lines. First Kofi Annan has resigned from his position as Syrian envoy. We got a look at his op-ed in tomorrows "Financial Times".

In it he says that military means alone will not end the crisis and that quote "The distribution of force and the divisions in Syrian society are such that only a serious negotiated political transition can hope to end the repressive rule of the past and avoid a future descent into a vengeful sectarian war." According to an opposition group 100 people were killed across Syria today.

Well, it was a rough day for Knight Capital Group. It's a trading firm and they announce they are taking a $440 million loss after a software glitch caused the company to send numerous bad trades in about 140 stocks. The thing is, $440 million matters to this company. It's over three times more than they earned last year and the firm says it's exploring alternatives. That means they could have to sell themselves.

Analysts we spoke to said they do have some assets that could be bought.

Well, U.S. sanctions against the Iran are costing the country $133 million a day. This is an analysis from Bloomberg, which shows shipments from Iran have dropped by 1.2 million barrels a day, or about 52 percent since the sanctions began on July first. Musha Bari (ph) of IHS CERA estimates Iran's oil export revenues are likely to fall from $108 billion last year to only about $70 billion this year -- $70 billion still means a lot of people around the world are buying Iranian oil.

Well, Facebook's rough ride continues. Shares briefly dipped below $20 a share a today. Ultimately, it fell 4 percent, closing just above $20, $20.4. The company is trying new things to try to get people engaged.

They launched a new Web site called Facebook Stories which is a way to showcase user's stories and ideas. There'd be a new theme for every moth. This month's theme is called remembering, just to try to remember historic buildings or things like that.

Here's the thing: according to regulatory filings, about 83 million Facebook accounts have no stories to share. Those are the fake ones or duplicates. And those of you who watch the show regularly know we've always been asking that question. They say they have 900 million accounts. How many of them are fake? It looks like nearly 100 million.

All right. Well, it's been 364 days since this country lost its top credit rating. What are we doing to get it back?

Well, we're getting closer to the one-year mark and I spoke to Mark Warner, a statesman in Congress from Virginia, about the credit rating and fiscal cliff. There were some things he was very down about he had one silver lining.

(BEGIN VIDEO CLIP)

SEN. MARK WARNER (D), VIRGINIA: America is one relatively small budget deal away from economic preeminence for decades to come.

(END VIDEO CLIP)

BURNETT: That inspired us and made us feel good. Hope it does you, too. Tomorrow, you're going to hear our interview with Senator Warner on the one year anniversary of that downgrade.

Well, now, our third story OUTFRONT: Al Qaeda bomb plot busted. In one of Spain's biggest operations against al Qaeda, three suspected members of the terrorist group have been arrested. Officials say the three had enough explosives to blow up a bus and could have been plotting an attack on a joint American-Spanish naval base.

This comes just days after the State Department said affiliate groups of al Qaeda are rising in places like Yemen, Syria, Somalia and Egypt. We witnessed al Qaeda's influence first-hand along the borders of Mali last week, and it continues to gain a foothold and northern Africa, Niger, Mauritania, Nigeria, Algeria and Somalia.

OUTFRONT tonight, senior international correspondent Nic Robertson who's done extensive reporting on al Qaeda and the Spanish plot. And Seth Jones, author of "Hunting in the Shadows: The Pursuit of al Qaeda After 9/11."

Nic, thanks so much. So, let me start with you. What -- what do you know about these -- these men in Spain, where they come from, where they are trained, their links to al Qaeda?

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Two of them, the ones arrested pulled off a bust yesterday. They are believed to have been Chechens. They have both got al Qaeda training at camps in Pakistan and Afghanistan, believed to have ties to the Pakistani jihadi group Lashkar-e-Taiba, who's responsible for that Mumbai attack in 2008, a very deadly attack in India.

The third man is Turkish. He was arrested today at a house near Gibraltar. In that apartment, police say they found some explosives but their sniffer dogs, their K-9 that went in also detected a lot of explosives.

The other thing about these guys, they have been practicing using paragliding, motorized paragliders and security authorities are concerned they might have been getting ready for an air borne attack on a joint U.S. Spanish military base nearby.

BURNETT: And, Seth, one of the suspects, Nic has more about this on a moment, but reportedly had explosive and chemical training, and as Nic was saying and reporting they have been learning to fly aircraft. How serious of a risk is this? Is this sort of surprising to you that there is anything new in what the training entailed?

SETH JONES, AUTHOR: I don't think the plot is surprising. We have seen threats even when I was in the government -- U.S. government, threats like this in Spain and the U.K. and other European countries. I think what's important to realize here, too, is -- as Nic mentioned, these -- at least one of these individuals had training in Pakistan and Afghanistan.

So there was an international dimension to both the training and the operations here which suggest a global nature of the problem.

BURNETT: And, Nic, any sense of how much further this goes? I mean, where the investigation is, obviously three people. But could it go farther? And what about the question of explosives and what they may have had?

ROBERTSON: Sure. It may definitely go further. I mean, the police have been on the tail of at least two of the guys in Spain, security authorities, as well from other European countries for the past month. So, they have been bugging them, trailing them. The apartment where they were using where the explosives were found was bugged.

There is at least another person that we know was involved that the police haven't talked about that they captured. That's the wife of the Turkish man that had the apartment where the explosives were being kept. The two who were arrested, they left the area in the south of Spain and heading north. Perhaps authorities believe to France.

Who are they going to connect with? Perhaps we're going to see in the near future more arrests in Spain. Of course, these explosives are missing. They're hidden somewhere and that's what the police are trying to find.

BURNETT: And, Seth, what about that issue that Nick just raised about France? I mean, obviously, you know, there was the horrible, you know, radical in Toulouse who had shot the Jewish children in the face to death, a horrible story. And just being along the Mali border with France as the colonial power in so many of those countries where al Qaeda affiliates are rising. There is a deep antipathy to France.

JONES: There are clearly is. France has been the target of strikes historically from groups especially in North Africa. Al Qaeda in the Islamic Maghreb has expressed very serious threats to France.

One other thing I just ad, too, again is we keep saying, administration officials keep saying that al Qaeda is on the verge of defeat. Here we have what looks like a very serious plot that is global in nature, that goes back to the area of Pakistan where al Qaeda is suppose to be defeated. I just don't see it.

BURNETT: Nic, it's an interesting point, right? I mean, people are saying, well, not only was al Qaeda not defeated, it was spreading into other places. But this does goes back to those original roots in terms of the training.

ROBERTSON: It does and there are indications that some of this training may go back many, many years when al Qaeda had training camps inside Afghanistan, if you're talking more than 10 years ago, as well as getting the training in Pakistan. There's talk as well of affiliation with Lashkar-e-Taiba who's responsible for all those killings in Mumbai.

But that group itself focused itself, they were Pakistani-based, Kashmiri-focused jihadi group has a lot of ideas in common with al Qaeda and have talked in the past about spreading going more and taking their attacks more international. We have seen more evidence of that in other countries.

And there is a concern that perhaps they are using networks created by this organization in France, for example, that exists and perhaps it is this organization, this Lashkar-e-Taiba going a bit more global, although there are reasons that would counter against that as well. But you know, the whole nexus of these groups inside Pakistan is not surprising. What concerns European authorities, you're talking about Islamic Maghreb across the north of Africa, very concerned that following the Arab spring, jihadist setting camps, al Qaeda in Libya, for example. Those are not for attacks inside Libya, but to attack inside Europe. We maybe seeing the beginnings of some of this now.

BURNETT: Clearly some in Mali as we saw last week.

Thanks to both of you. Well, our fourth story OUTFRONT: the biggest drought in half a century hiking up costs on grocery. In fact the drought is impacting the price tag of 3/4 of food in supermarkets right now.

So, Congress controls agriculture in this country and what are they doing about it? It may not surprise you to hear that they are not doing much. In fact, lawmakers left today for one month vacation.

Senior congressional Dana Bash is OUTFRONT with the story.

(BEGIN VIDEOTAPE)

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT (voice-over): Today's pig is tomorrow's bacon.

And at hard hit hog farms like this one in Iowa, this year's devastating drought is all but certain to mean higher pork prices next year. Likely adding to the cost, livestock producers are not getting the federal aid most farmers are.

Livestock is not covered by key government programs.

Why? Because of an accounting trick to save money in the farm bill four years ago. Congress eliminated federal aid for livestock in 2012, this year. And, oops, it turned out to be the biggest drought in half a century.

STEVE ELLIS, TAXPAYERS FOR COMMON SENSE: I expired because they were playing a gimmick to keep the costs of the last farm bill down. So it turned around and really bit them in the behind.

BASH: So, now, in a mad dash to act before leaving for summer break, the House took up a $383 million bill to restore four expired programs, for livestock, certain trees, honey bees and farm-raised fish.

Freshman Republican Kristi Noem, a rancher and farmer herself, argues the aid now is crucial.

REP. KRISTI NOEM (R), SOUTH DAKOTA: Our livestock guys take just as much risk as any other farmer or rancher out there. And they need to have some kind of protection in situations like these.

BASH: But in the Senate, Democrats refuse to pass drought relief before leaving town. Why? Bare knuckle negotiating.

Democrats like Agriculture Chairwoman Debbie Stabenow worry a short-term fix will undermine their long-term five-year farm bill, which includes disaster relief and reforms scores of farm programs.

(on camera): In the optics of Congress leaving town with the worst drought in half a century and not doing something -- not so good?

SEN. DEBBIE STABENOW (D), MICHIGAN: The optics are in this building. If we get out in the real world, that's not what we're hearing from farmers and ranchers. Farmers and ranchers want us to get our job done. They want a five-year farm bill. They want us to address disaster assistance. I intend to do both.

BASH (voice-over): So, why not pass that five-year farm bill? A candid House speaker admitted he doesn't have the votes.

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: The House is pretty well divided. And, frankly, I haven't seen 218 votes in the middle to pass a farm bill.

BASH: The Senate bill is nearly $1 trillion. The majority of the spending $80 billion a year pays for food stamp programs. Some Democrats say that's not enough. Some Republicans say it's too much.

On farming, the measure eliminates most direct payments to farmers, replacing them with expanded crop insurance programs.

Watchdog groups call the programs waste.

ELLIS: We are looking at a little over $20 billion in the first four years of the program. We're looking at another $20 billion in this last year.

BASH (on camera): Just in one year alone.

ELLISS: Just in one year alone.

(END VIDEOTAPE)

BURNETT: Dana, I know they went on vacation for five weeks. You were asking somebody a question there from Michigan, who said, oh, no one is upset. We're going to do the full thing, not just little Band- Aid thing before we go.

But is there real backlash to the fact that they didn't deal with the disaster relief?

BASH: You know, the people who voted against it or decided not to do this in the Senate, they insist the answer to that is no, Erin. They say that they have big organizations like the cattle ranchers behind them.

You know, in the case of Debbie Stabenow, she's the Senate Agriculture chairwoman, she is up for reelection in three months and she -- you know, it's hard to believe that she would go home without doing anything for those who were really the hardest hit who don't have help from the government if she thought it was a political liability. So, they think ultimately they will be OK.

But it's still going to be a big fight to get this heavy lift of a farm bill in the fall when they come back.

BURNETT: All right. Thanks very much to Dana. A lot of people watching that and everybody around the country being hurt by that failure right now. Well, OUTFRONT, a disaster of biblical proportions in Taiwan. We're going to show you the images of what's happening there right now. And the thin line between protecting doctor/patient privileges and stopping mass murder.

(COMMERCIAL BREAK)

BURNETT: We're back with our outer circle where we reach out to our sources around the world.

And we begin tonight in China where a massive typhoon is pounding the country. It's already killed 23 people in the Philippines and it dumped more than five feet of rain in parts of Taiwan.

Jaime FlorCruz is in Beijing and we asked him how the country is fairing.

(BEGIN VIDEO CLIP)

JAIME FLORCRUZ, CNN CORRESPONDENT: Erin, not one but two typhoons are slamming China and meteorologists are warning of potential damage not only along the coast but also inland with residents bracing for strong winds and heavy rain. We already know what kind of damage typhoon Soala left behind in Taiwan. The typhoon pounded the island on Thursday, triggering flooding, shutting down schools and paralyzing air and train services.

At least one person was killed in the landslide and Chinese officials say a second typhoon can be just as destructive. So China's premier is overseeing disaster prevention measures to avoid loss of life -- Erin.

(END VIDEO CLIP)

BURNETT: Our thanks to Jaime.

And now to Uganda where five prisoners are now the latest suspected of the Ebola virus. One hospital in Kigali has become ground zero for the outbreak. Our David McKenzie, as you know, has been there day in and day out. And I asked how doctors are trying to keep it from spreading.

(BEGIN VIDEO CLIP)

DAVID MCKENZIE, CNN CORRESPONDENT: Ministry of Health cars just came in to this hospital in Kigali. They brought three men, two of them were wearing gloves, sitting up and the other one was prone on a bed obviously in great distress. What they do is they take them into this hospital like this and then have to spray them, I can see through the fence, spraying all over his face, his body, even the mattress, anything in that location where they found the suspected case has to be disinfected.

And then they move on to where the health workers are all in full protective gear and they have to register the patient, take him into a general ward and then send a blood test to Entebbe, on Lake Victoria. There they can get a sense whether the person has Ebola or not.

But you can just see the level of protection people need to deal with these cases. That's why this outbreak is so crucial to stamp out in the next few days. And health officials say the cases could increase. And so, takes braving health workers like that to bring cases in and try to stabilize patients.

(END VIDEO CLIP)

BURNETT: Brave reporters like David McKenzie to go on the scene.

Well, our fifth story OUTFRONT: warning signs. Were warning signs about theater shooting suspect, James Holmes ignored.

Court papers show that the accused masked murderer was being treated by a University of Colorado psychiatrist. According to CNN affiliate KMGH, the psychiatrist he was seeing, you see her there, Dr. Lynne Fenton, was so concerned that Holmes could be a danger to others that she referred his case to members of a threat assessment team.

Now, her warnings on this, crucially, came six weeks before the shooting, but police were never called as a result of that. Again, according to KGMH, around the same time, Holmes withdrew from the university. But the question now is glaring: could the shooting have been prevented.

OUTFRONT tonight, Dr. Michael Welner, a leading forensic psychiatrist and developer of the Depravity Scale, along with Paul Callan.

OK. Great to see both of you.

And, Dr. Welner, let me start with you because you have had a lot of experience with high risk patients. So his psychiatrist went to a threat assessment board and says I'm worried he's going to do something. They presume decide not to pass it on to law enforcement authorities. We know they did not, we don't know when they met.

When do you know if it is time to break confidentiality of your patient, forget the threat assessment board as a doctor, and go to authorities yourself?

DR. MICHAEL WELNER, FORENSIC PSYCHIATRIST: Two perspectives. One is a clinical perspective and is a forensic perspective. The clinical perspective is, if you're treating a patient and you can identify a target, then you inform the target. If you can identify the immediacy of a threat, then that's time to get somebody committed to a hospital.

The forensics perspective is the population. Mass shooting, unlike other homicide and unlike other high risk patients, it's not just a psychiatric issue, sometimes it's not a psychiatric issue, it's a social phenomenon where a person is invested in the idea what is going to be the social payoff for me of becoming a notorious mass murder, everybody is talking about me on CNN. Why is that important here? Because it happens on his clock, which means he can be thinking about it for months. Look, the amount of explosives --

BURNETT: You're saying in those cases, even though clearly something is wrong, you don't convey that --

WELNER: The amount of explosives and the sophistication of booby trapping, he didn't do it overnight. He didn't learn it overnight. The point is with a mass killer, he decides today is the day.

He may not have made that decision back in June or whatever. It may just have been a risk. The imminence of it was not something that could be identified.

And indeed, what may learn is that only became immediate when he made the decision, I'm leaving school. I'm going to invest in this alternative life path.

BURNETT: A quick follow-up on that, though, you know, as someone who's done this a lot. Does this happen where people make threats of these mass shootings? I don't want to use the word regular. My point would be it happens enough as a doctor you don't pass them all to law enforcement because most are not real threats?

WELNER: You have to take a threat seriously. And you probe it. It sounds like the psychiatrist from everything we've learned actually handled it quite responsibly. In fact, she may have had so much vigilance that people felt she was being an alarmist.

BURNETT: So, Paul, what about that question? The reality of it will be there will be people that will say that either she or that threat assessment board should have gone to law enforcement. These people died as a result of their failure, so they're liable.

PAUL CALLAN, CNN LEGAL CONTRIBUTOR: Well, there will be lawsuits. But in the end, we're going to look at what did Dr. Fenton know and when did she know it. And unless there's proof that he threaten a specific individual or a specific group, if he said I will go to a movie theater and blow it up, she had obligation to go to the police herself.

The way this played suggests to me that he didn't say anything that was threatening to a particular individual or group, because she goes to the assessment team, she asks for help and guidance. She wouldn't need help and guidance if he made a specific threat.

And then once you get to the threat assessment teams, it's a whole different thing. They're looking to help students as opposed to avoid crimes.

WELNER: And there's another important point for us all to understand about this particular type of crime and that is mass murder is not about a crime of people who fall through the cracks. It is specifically a crime about people who crawl into the cracks. If he made a decision that he was going to embark on this, he may have intimated, he may have talked about it. But once he made the decision to proceed, he would have been determined not to be stopped.

(CROSSTALK)

WELNER: You can stick with a patient as a psychiatrist. If he decides, if I open up to you, you're going to hospitalize me.

I examined Andrea Yates. She knew she was going to murder her kids. She didn't tell the psychiatrist because she knew the psychiatrist would protect the kids and she got off on insanity. But she knew for two months she was going to murder them.

BURNETT: That's amazing.

WELNER: So, someone who has a plot and a design and a determination, and a mass killer does, they will be silent because they don't want it stopped, because they're going for the payoff of us talking about them and they don't want that taken from them.

BURNETT: Final follow up, Paul, what about the case in Maryland, says he is going to get people in the workplace. He's got 25 guns, thousands of rounds of ammo. They stopped him. He gets a $500 fine.

CALLAN: They just stop him. He's only charged with a misdemeanor. They intervened early in that case and they stopped him.

BURNETT: He's punished by stopping the crime.

CALLAN: Well, he was -- they did stop the crime, but he is in a mental psychiatric facility right now. So, everybody is in a difficult spot.

If you put too much burden on the psyches, troubled people won't go to psychiatrists and they won't open up to psychiatrists. It's a difficult situation.

BURNETT: I think a really important point. Thanks to both.

OUTFRONT next, the Olympics.

(COMMERCIAL BREAK)

BURNETT: The Olympics badminton match throwing scandal continued today. There was apology from the Chinese coach. One of its star players retired. And, of course, it comes after yesterday's announcement by the World Badminton Federation that eight players have been disqualified for not using one's best efforts to win a match. Now, they were doing that on purpose and it's a huge scandal for a sport that's usually ignored.

But the truth is, the players didn't do anything wrong, because none of the eight players were doping, didn't injure anyone else, didn't quit or cheat. They just used a system in place to try to get advantage. They thought that by losing a match early on with a bad group, they'd get a more favorable draw in the future, getting a better shot at the gold medal. That's a problem with the system, not the players, especially since tanking games isn't new.

There's a lottery in the NBA because teams were accused of throwing games to secure the top draft picks. Iranians have thrown matches so they don't have to not face Israelis. In the Olympics this year, the Japanese soccer team played to a tie to avoid playing the United States.

Everyone wants an edge. You can call it bad sportsmanship, but this seems to be the nature of pro sports, and by pro sports, we mean the Olympics, what was once an opportunity for amateurs to compete at the highest levels is now a show case for corporate sponsors like McDonald's, Coke, and Heineken. And while the badminton players are chastised for dirty tricks, the dirty truth is this, this may be the behavior the games encourage.

Here is hoping for less commercially driven games, really are about athletes, not about winning endorsements and being paid for by companies that make food and drinks that no great athlete would regularly eat.

Thanks for watching.

"ANDERSON COOPER 360" starts right now.