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ERIN BURNETT OUTFRONT

Interview with Representative James Clyburn; Low Voter Turnout; Voter ID Laws

Aired July 25, 2012 - 19:00   ET

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


JOHN AVLON, CNN CONTRIBUTOR: OUTFRONT next, playing chicken with the fiscal cliff. Today, the Senate hit the gas and headed towards the edge and the U.S. and Russia at odds over whether officials have the right to confront some Americans in their own homes. And new details are coming about the young man who police say shot and killed 12 people inside a Colorado movie theater, plus, one of the victims who was shot three times has just been released from the hospital and he's OUTFRONT tonight.

I'm John Avlon in for Erin Burnett. OUTFRONT tonight, playing chicken with the fiscal cliff. Today the Senate appeared to take action on extending the Bush era tax cuts, appeared being the keyword. Senator Majority Leader Mitch McConnell announced he would not filibuster the measure. That's the reflexive maneuver that makes 60 votes the bar to get anything done in the Senate.

Instead he allowed a straight up-or-down majority wins vote on the two-party's dueling plans. The Republican plan, extend the tax cuts for everyone and President Obama's plan, extend the cuts for 98 percent of Americans. That's households making under $250,000 a year. But why would Senator McConnell do such a thing?

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: The only way to force people to take a stand is to make sure that today's votes truly count, by setting these votes at a 50-vote threshold, nobody on the other side can hide behind a procedural vote while leaving their views on the actual bill itself a mystery, a simple mystery to the people who sent them here.

(END VIDEO CLIP)

AVLON: And tonight, we now know where everyone stands. The Democrats' bill narrowly passed, 51 to 48 with two Democrats, Joe Lieberman and Jim Webb opposing. The Republicans' plan failed. And just to give you an idea of how big Democrats thought today's vote was the vice president himself was there in the big chair in case he needed to break a tie. Now on the surface, this may look like a big win for the president and his party.

But before you break out the champagne, here's a reality check. This is all just political theater. No real legislation that will affect you or me came out of Capitol Hill today. And every member of this kabuki Congress knew it. Instead, we're still playing chicken with the fiscal cliff, which includes payroll taxes going up, emergency unemployment benefits ending, 1.2 trillion in so-called sequestration cuts and tax cuts expiring for everyone automatically.

Now, the CBO says if Congress lets this happen, economic growth could contract by 1.3 percent during the first half of 2013. The agency says would probably be judged a recession. Now keep in mind our economy is only projected to grow between 2.2 and 2.8 percent next year. Here's what is even worse.

Not only are we speeding towards that fiscal cliff, we're wasting money with all this mindless bickering. This week, we actually learned the cost of all this sandbox politics, $1.3 billion. The Government Accountability Office calculated the cost of last summer's debt ceiling debate. A fight in the name of fiscal responsibility that essentially held the full faith and credit of the United States hostage actually ended up costing taxpayers an additional $1.3 billion.

And as you hear it on this show every day, it's been almost a year since we lost our AAA credit rating. And it's all because of Washington's inability to work together. OUTFRONT tonight, one man who's a leader in the House and a member of the Super Committee which couldn't ultimately make a deal, Democratic Congressman James Clyburn. It is good to see you sir.

REP. JAMES CLYBURN (D), SOUTH CAROLINA: Thank you. Thanks for having me.

AVLON: You've been in Congress for over three decades, so my first question is has it ever been this bad and who could you make a deal with on the other side of the aisle?

CLYBURN: Well I've been here a little short of two decades. I came here in 1993. But from afar, I have seen it this bad, maybe not over the deficit and over the budget. But I can remember the hustles and tussles back in the '50s and the '60s. I'm just old enough to remember all of those things and had a great interest in it. So I would say to all of the viewing public, the only thing that's different today than from 30, 35 years ago is the fact that there's instant news now. Everything is done in real time. And communications are so much better, and people are a little more tuned in. But these kinds of things are not all that strange to the Congress.

AVLON: Well, then give us some assurance. Tell us that behind the scenes at least there's some constructive conversation going on about how to deal with this fiscal cliff before we go over it.

CLYBURN: Well, I believe that the budget priorities committee, the committee on budget priorities and policies, they have said to us that this is not really a cliff in the common sense of the word, but more like a slope because I do believe that even after the elections, there is plenty enough time for us to come back here in a lame duck and do what is necessary to extend budgetary considerations for at least a year while we'll have time to really work on things we need to do. And that is to have the massive overhaul of our tax code. I think that we're in the trouble we're in today not so much because of people's priorities but because we have a problem with our tax code that needs to be fixed. I think that's what's important about that vote today.

(CROSSTALK)

AVLON: Well but, Congressman, you know that approach of, we'll all get together and work together after the election never -- someday never seems to come. You know you were on the Super Committee.

CLYBURN: Yes.

AVLON: And Republicans say that there was never a serious proposal from Democrats to deal with entitlement reform. So just help clear that up tonight. What specific concessions on entitlement reform did you and your fellow Democrats put forward on the Super Committee?

CLYBURN: There were a lot of considerations given and I think the -- you remember Senator Baucus brought an issue to the table that had massive entitlement controls. The last time I checked, he is, in fact, a Democrat. I would ask you to ask those Republicans, what kind of tax cuts, what kind of revenue (INAUDIBLE) did they ever bring into serous discussion? They never did bring any.

AVLON: OK.

CLYBURN: And so that's where the problem was. We're supposed to have the people living on fixed income, people getting Medicare, Social Security, Medicaid, they're supposed to make all the sacrifices while wealthy people continue to pump their earnings off shore and not even pay taxes on them. So this is the kind of stuff -- there's another report out today about the trillions of dollars that are being hidden in offshore accounts by very wealthy people while we're talking about making poor people suffer entitlement cuts.

AVLON: Well, Congressman, thank you for coming OUTFRONT. Let's hope a deal can get made before we go off that fiscal cliff.

(CROSSTALK)

AVLON: Still OUTFRONT tonight President Obama is hoping to secure reelection with the help of black voters, but do those votes add up?

And the mother of baseball legend Cal Ripken, Jr. abducted at gunpoint but released, what we're learning about the kidnapping and the suspect, and new details about the suspected gunman in the Colorado movie theater shooting.

(COMMERCIAL BREAK)

AVLON: Our second story OUTFRONT tonight, can Barack Obama depend on 2008-level support from black voters in November? A new report by the National Urban League says African-American voters could tip the election this year by staying home and costing the president crucial votes in battleground states. And minutes from now, the president is taking his message straight to the Urban League. So how concerned should the Obama campaign be? Well John King has been breaking down the numbers. John, what states could be affected here?

JOHN KING, CNN SENIOR POLITICAL CORRESPONDENT: In a word, John, they should be very concerned and let's go through the states. In the end, politics is about math, addition and subtraction. That Urban League study says about 65 percent of African-Americans turned out in 2008 and they say if it dropped back to 2004 levels that would be about 60 percent. If it dropped back, the Urban League study says, good-bye, North Carolina.

That's a state the president carried last time. About 25 percent of the vote this year in North Carolina will be African-Americans. If numbers drop, if that percentage drops and turnout drops, well then the president it says, the Urban League says will lose North Carolina. In Virginia, 50 percent of the vote just in Richmond, the capital city, is African-Americans, 20 percent of the votes statewide in Virginia, again if turnout drops, the Urban League says probably that one gone from the president's column.

It also says Ohio, John -- we know Ohio was always the mother of all battlegrounds. About 50 percent of the vote in Cleveland is African-Americans. Democrats need that cushion. You see how big of a cushion the president got there four years ago. Democrats need that cushion from African-Americans in Cleveland to win statewide. Again if that turnout is down, the president would be at risk. The report also says Michigan would be at risk.

Another state, this might surprise you, Florida could be at risk, only about 12, 13 percent of the vote statewide in Florida African- American, but about 20 percent of the vote down in the Miami area, African-American. That is another state that could be at risk. And John, even Pennsylvania, people will say, what are you talking about, a nine-point victory for the president last time. But if African- American turnout is down significantly, even Pennsylvania could be at risk.

AVLON: So let's do a deep dive on the "Keystone State" here. Really walk us through how Pennsylvania could be in play if African- American vote doesn't reach those levels.

KING: Let's come west to east. Most of the African-American vote is in the east in Philadelphia. But most people believe that Mitt Romney will do better than John McCain. You see all this red in the western part of the state, but a lot of these counties were closer in 2008 than they were in 2004 and 2000. People think Mitt Romney will do better than John McCain.

Then you come over here, Scranton, Allentown, Redding, these are places that Barack Obama struggled in the Democratic primaries. If Mitt Romney can do a little bit better again against blue-collar white workers, people who work with their hands, he can do better, then we come right in here to Philadelphia and the suburbs. This is where the state is always decided, John. I want to show you this right here. Of the president's big margin statewide, much of it, the overwhelming bulk of it came from this whopping size victory in the city of Philadelphia. We went to Philadelphia today to look at the turnout operation. I was there several times back in 2008. The campaign got an early start because, why? African-American unemployment is high. It knows that could have some people discouraged saying, hey, he's been president for 3.5, almost four years now, why should I vote?

They also think there could be complacency. The margin was so big last time they think a lot of African-Americans will say, my vote doesn't matter. The president is going to win in Philadelphia area. They also, John, think this is an important factor. History had volunteers pounding on the doors of Obama campaign officers four years ago.

African-Americans wanted to be part of making history. I was there today at one campaign office. It was very, very busy, but even people there concede the point that it's harder the second time around. He's an incumbent president. You're not making history. You've got a tough economy especially among younger African-Americans, so the Obama campaign has this advantage.

There was no primary challenge. They had been working at this for months and we saw that activity today, but that activity is part of the worry. They know if the numbers are down here in Philadelphia and Mitt Romney can do a little better out in the suburbs, then you've got a battleground state.

AVLON: John King, fascinating analysis. As we know, every vote counts. Thank you.

Also in Pennsylvania, a shocking revelation from the state about its controversial new voter ID law, which is being challenged in court today that a law requires all voters to show photo ID, something say critics will depress turnout and unfairly target minorities and Democrat-leaning voters. Supporters argue it's necessary to prevent voter fraud, but this legal document, in this document, the state admits that it is quote, "not aware of any incidents of in-person voter fraud in Pennsylvania." In addition, the state says it has no evidence to prove that, quote, "in-person voter fraud is likely to occur in December 2012 in the absence of the photo ID law."

Reihan Salam and Jamal Simmons join me. Welcome. Good to have you both on set.

UNIDENTIFIED MALE: (INAUDIBLE)

AVLON: Reihan, if the state is admitting that photo -- this photo ID law could not -- is not going to have an effect, that this is not a problem, what's the fight about? What are we talking about? Why is this necessary?

REIHAN SALAM, CNN CONTRIBUTOR: Well I think that you might be misinterpreting what was said. Here's the thing. Prosecutors are very stretched and they have limited resources in terms of what they can investigate and what they can prosecute. And voter ID fraud, voter fraud that is, is something that hits a relatively low priority issue partly because it's very fraught (ph), so you don't go after those things.

You don't investigate them. You don't prosecute them. That doesn't mean that you don't try to take the necessary steps to prevent voter fraud from happening in the first place. There's a lot of financial fraud that happens, John that doesn't actually get investigated and doesn't actually get prosecuted. That doesn't mean it's not there. That doesn't mean you don't take prudential (ph) steps to prevent it.

AVLON: I just think you know if this was a real problem, they'd be saying they have some credible case, a single credible case to make in court and they haven't. Let me ask -- just go to Jamal for a second because right now as many as 758,000 people in Pennsylvania don't have the required photo ID. So that's larger than Obama's victory over John McCain in the state in 2008. So right now, CNN, we have Pennsylvania leaning Obama. But is this a real problem for the Obama campaign?

JAMAL SIMMONS, DEMOCRATIC STRATEGIST: This is a problem. I've got to say first of all, I must have the worst timing in the history of television because this is my virgin (ph) experience here in the OUTFRONT studio and you are my first. Where's Erin?

(LAUGHTER)

AVLON: I'm sorry to disappoint you, Jamal.

SIMMONS: Back to serious. You know this is a really big problem and as the attorney general said recently, this is almost like a poll tax because for many people who do not have photo ID, who have to go in and register for photo ID, get their driver's license or get their birth certificate, it's going to cost them money to get those documents before they go in to see the secretary of state, so that's going to cause people a problem. And if you're a poor or elderly person who doesn't have a hold of your documents, this could be a really huge impediment to you showing up and voting.

AVLON: It certainly could potentially. Reihan, we had a very heated animated discussion a little while ago featuring a member of the GOP leadership in Pennsylvania making a claim in front of cameras about the impact of this voter ID law. Let's have a quick listen.

(BEGIN VIDEO CLIP)

REP. MIKE TURZAI (R), PENNSYLVANIA STATE HOUSE MAJORITY LEADER: Voter ID, which is going to allow Governor Romney to win the state of Pennsylvania, done.

(APPLAUSE)

(END VIDEO CLIP)

AVLON: So this on-camera statement plus this letter from the governor's office, how can the Republican Party fight this perception -- let's say it's just a perception -- that this is not simply about politics?

SALAM: John, there are two things to keep in mind. One is that in Pennsylvania, there are a lot of raw feelings from earlier elections. For example, in 1999, the Philadelphia mayoral election in which a candidate named Sam Katz (ph) narrowly lost to another candidate, John Street. There is a lot of concern about fraud but it wasn't rigorously investigated partly because that would lead to a lot of raw feelings in the community, but that's one reason why Pennsylvania folks are concerned about that issue.

Another thing to keep in mind is that there are about 30 states that have passed voter ID laws. These laws range dramatically. For example, in Rhode Island, you have certain provisions that are going to be kicking in, in 2014 rather than in 2012, whereas Texas and Pennsylvania have particularly rigorous laws. They're trying to bring online perhaps faster that they can realistically accomplish. Virtually all of these states have provisions for free IDs. And they're actually trying to address some of those concerns that you have about indigent voters. But, again, it's all about does the system, does that bureaucracy move quickly enough to accommodate that. And that's a legitimate concern.

AVLON: We've got 11 new states with these laws in place, some (INAUDIBLE) battleground. This is going to be a debate we're going to continue to have, but --

SIMMONS: (INAUDIBLE) Democrats are really focused on it. I don't think that it's going to be -- we're not going to sit around and wait for this to happen --

SALAM: It's important --

(CROSSTALK)

SALAM: -- the facts (INAUDIBLE) particular laws.

AVLON: It is. This is a very damning document. I think we'll be hearing more about it. Thank you both for joining us, Reihan and Jamal.

UNIDENTIFIED MALE: (INAUDIBLE)

AVLON: All right, ahead, do Russian officials have the right to come into the homes of children adopted in the U.S.? Why Russia and the State Department (ph) don't agree.

And Mitt Romney and President Obama are exchanging some strong jabs in new ads, but do their attack lines add up?

(COMMERCIAL BREAK)

AVLON: Are we seeing the rise of an AC/DC cyber virus? I'm talking about the rock band. Bear with me. A Finnish tech company (INAUDIBLE) says it received an e-mail from a scientist at the Atomic Energy Organization of Iran that claimed Iran's nuclear program has been compromised by a new cyber virus, one that randomly causes computers to play AC/DC's "Thunder Struck" at loud volumes. And the company can't verify the e-mail's claims are true, but it can verify the e-mail was sent from a researcher within the Atomic Energy Organization. So why should you care? Well cyber security is a big issue that Congress is finally trying to tackle.

Tonight, the Senate is starting to debate a bipartisan bill that would require both government and private companies to do more to protect their networks from the threat of cyber attacks. The number tonight $1 trillion, that's how much computer crime costs companies, according to a study by McAfee and SAIC (ph). And that was back in 2008. Chances are that number is much higher now. We shouldn't have to wait for a digital Pearl Harbor to take the cyber security threat seriously.

Still OUTFRONT in our second half, a controversial adoption agreement with Russia. Would it sell out some American parents? And a miraculous recovery, he was shot three times during the movie theater shooting, but tonight he walked out of the hospital and he's OUTFRONT ahead.

(COMMERCIAL BREAK)

AVLON: Welcome back to the second half of OUTFRONT. We start the second half of our show with stories we care about, folks who are reporting from the front lines. The USDA said food prices could rise as much as three to four percent next year. It's all because right now the U.S. is experiencing the worst drought in 50 years and it's taking a real toll on corn crops. Take a look at this chart from RBC Capital Markets. It shows the average percent of corn crops rated excellent or good from 2007 to 2011 and compares it to this year. And you can see the steep falloff. The decline has caused corn prices to rise to nearly a record high, which means ultimately other food prices will rise.

Treasury Secretary Timothy Geithner testified on Capitol Hill today about the ongoing LIBOR scandal. We monitored the hearing. It was occasionally heated with members of both parties expressing outrage over the rate manipulation. Geithner defended the New York Fed's actions.

(BEGIN VIDEO CLIP)

TIMOTHY GEITHNER, TREASURY SECRETARY: I felt that we did the important and fully appropriate thing which is to bring the attention not just to the people in Washington --

(CROSSTALK)

GEITHNER: -- but to the British of the -- not just the reports and the concerns that were broadly available in the market in the public domain but also of the range of problems in the way this rate was designed to create that vulnerability. And so, we gave -- we brought those concerns to their attention.

UNIDENTIFIED MALE: Sure.

GEITHNER: And we felt, and I still believe this, that it was really going to be on them to take responsibility for fixing this.

(END VIDEO CLIP)

AVLON: LIBOR will almost certainly come up again when Geithner testifies tomorrow in front of the Senate Banking Committee.

Legendary baseball player Cal Ripken's mother is saved today after being abducted at her home yesterday. Police in Aberdeen, Maryland, say Ripken's mother was forced in her vehicle by a man with a gun yesterday morning. She was found in the backseat of her car this morning with her hands bound but otherwise unharmed.

Law enforcement officials tell CNN that the man appears to have used her credit cards and had no knowledge of a ransom being demanded or paid. Police are still searching for the suspect.

Now, it's been 356 days since the U.S. lost its top credit rating. What are we doing to get it back?

Well, the Dow finally snapped its losing streak today, closing higher by nearly 59 points. The S&P and NASDAQ closed lower.

Our third story OUTFRONT tonight: Russia in a tug of war with the United States over adoptions. The two countries are hammering out a controversial deal that regulates adoptions from Russia by Americans. The pact comes after the bizarre high-profile case of a Tennessee woman who sent her adopted son back to Russia alone on a plane. The boy carried a letter that said his adoptive mother didn't want him anymore.

Now Americans are worried this treaty could be far-reaching, even allowing Russians into their homes.

Kyung Lah went OUTFRONT to see if those concerns add up.

(BEGINV VIDEO CLIP)

UNIDENTIFIED MALE: Why wouldn't you come just to talk?

KYUNG LAH, CNN CORRESPONDENT (voice-over): Arriving in a caravan wearing dark suits and carrying cameras, Russian government officials demanding entry on to a private ranch in the small town of Eureka, Montana, both sides recorded the confrontation. The Russians demanded to see children adopted from Russia and sent to this remote ranch by their American parents.

This is Pavel Astakhov, the Russian children's rights commissioner in Moscow.

"There are so many lies regarding the well-being of our kids," says Astakhov to the Russian TV crew. And he's here to see the children for himself.

He claims the Russian children are abandoned by their parents at this ranch and then neglected here.

That's a lie, says Joyce Sterkel, she runs the unlicensed facility called the Ranch for Kids, a church mission for adopted children whose problems like fetal alcohol syndrome were detected only after the adoptive parents brought them back to the U.S.

JOYCE STERKEL, RANCH FOR KIDS: This is the United States of America. This is the sovereign state of Montana. And a foreign government cannot come in here and push your way into a private residence and a private program. That is completely uncalled for.

LAH (on camera): But that's what he tried to do?

STERKEL: That's what he tried to do.

LAH (voice-over): Two sides deeply suspicious of each other, a suspicion fueled by a bilateral agreement on adoptions between Russia and the U.S. which aims to better protect both children and American parents.

Astakhov says key to the agreement, it fundamentally gives his country more authority to check an adopted children like at the Ranch for Kids. Astakhov spoke to CNN via Skype from Russia.

PAVEL ASTAKHOV, RUSSIAN CHILDREN'S RIGHTS COMMISSIONER: We have a right to ask the permission from State Department to visit Russian children which we are interested and which we want to see and to control the situation. Basically we have a chance and we have a right.

LAH: Astakhov stresses only cases of suspected neglect will be targeted. But American families are asking, how much power does a foreign government have in an American home?

(on camera): The fear goes beyond what happened here at the gate with the Russians. This ranch and adoptive parents believe it's a signal about the bilateral agreement and what they'll lose as their rights as adoptive parents.

Which boy is Sean?

SHAROIN HOULIHAN, ADOPTIVE MOTHER: Sean is in the brown.

LAH (voice-over): Sharon Houlihan adopted her son, Sean, when he was 19 months old. She says he flies into fits of violent rage caused by fetal alcohol syndrome. The ranch has helped dramatically says Houlihan and no foreign government should tell her what's best for her son.

HOULIHAN: When you make that commitment, they're yours. To have a foreign government have the ability to come in to question my child and make those determinations about his well-being, I find that just not acceptable. LAH: The State Department says it supports appropriate access for concerned foreign officials to children who have both U.S. and foreign citizenship, consistent with privacy rights and only with consent of parents or legal guardians.

Bottom line, the State Department says parents will never be forced to let anyone see their children under the new agreement. But the ranch owner who's already seen Russians on her doorstep doesn't believe the deal will actually protect American parents.

(on camera): What do you tell the State Department when they tell us? This isn't going to happen?

STERKEL: It just did. It happened.

(END VIDEOTAPE)

AVLON: Kyung, it's fascinating story. Why are the Russians so interested in this particular ranch?

LAH: Because there are so many Russian children who are there. There are about 10 at this facility. And the Russians say that this is just a depository for unwanted children because the parents aren't there. But the ranch says this is a place where they get real help.

Having spoken to the American parents, they say these are kids with serious problems, fetal alcohol syndrome, and the ranch is making a difference with these kids.

AVLON: And this whole story gets to the heart of so many emotions, about family, about sovereignty. Do we know what the text of this treaty is?

LAH: Right now, we don't. It hasn't officially become public. We know what the general overview is. That's what the State Department has shared with the parents. But the parents say they just don't buy what the State Department says because if the State Department says that they still maintain all of their rights, well, why did the Russians show up at the gate?

AVLON: That is the question. I mean, they're scared.

But are they really scared about the potential of a deal here? Are they worried, looking over their shoulders to see when the Russians might come next?

LAH: They are, because you may have noticed in our story, the faces were blurred. The reason why those faces are blurred is because they're parents are truly, truly afraid.

AVLON: Extraordinary story. Kyung, thank you very much.

Our fourth story OUTFRONT tonight, the Obama and Romney campaigns at each other's throats over remarks President Obama made about small business owners almost two weeks ago. The fight started when the Romney campaign release this ad. (BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: If you've been successful, you didn't get there on your own. If you've got a business, that -- you didn't build that. Somebody else made that happen.

(END VIDEO CLIP)

AVLON: The only problem was that wasn't exactly what the president said. And the Romney campaign came under a lot of fire for mischaracterizing his remarks. Well, today the RNC released a new ad without those edits.

(BEGIN VIDEO CLIP)

OBAMA: If you are successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you've got a business, that -- you didn't build that. Somebody else made that happen.

(END VIDEO CLIP)

AVLON: So it's time to fact-check the "you didn't build it" debate.

Glenn Kessler is with us tonight. He's "The Washington Post" fact-checker.

He gave the first ad three out of four Pinocchios.

So, Glenn, are you satisfied now?

GLENN KESSLER, "THE FACT CHECKER" FOR THE WASHINGTON POST: Well, the part that the RNC showed there was, you know, it did include the eight or so sentences that were missing in the Romney ad. It missed the rest of what he said where the president provided additional context of what he was trying to say.

AVLON: Let's actually play that rest. We've got it right here.

(BEGIN VIDEO CLIP)

OBAMA: If you've got a business, you didn't build that. Somebody else made that happen.

The Internet didn't get invented on its own. Government research created the Internet so that all the companies could make money off the Internet.

The point is, is that when we succeed, we succeed because of our individual initiative but also because we do things together.

(END VIDEO CLIP) AVLON: As you well know, Glenn, I mean, we live in a time where narratives drive debates even more than facts. And especially if the president was clumsy with his wording, there's a perception that he meant what he said. And politics is perception.

So, how damaging is this for the Obama campaign?

KESSLER: Well, this is certainly a problem for the Obama campaign. When you actually saw this extraordinary thing today where the president himself made an ad from the West Wing of the White House, speaking to the camera saying, I'm being misquoted, this is not what I meant. And the problem with the phrasing that he used here, which was, you know, clumsy and difficult to completely understand, is that it buys into a narrative that the Republicans have been trying to put out there, which is, this president doesn't really care about individual initiative. He's suspicious of free enterprise. He's just a big government liberal.

So it's a gaffe but it is a gaffe that sticks because it kind of fits into preconceived notions that are out there.

AVLON: I think that's exactly right.

Now, the Obama camp is returning fire the an ad of its own. Let's take a listen.

(BEGIN VIDEO CLIP)

STEPHANIE CUTTER, OBAMA CAMPAIGN: Ironically, Mitt Romney knows better than anyone, that business can't always do it alone. When Bain and Company was on the brink of bankruptcy, Romney himself negotiated a $10 million bailout with the FDIC.

(END VIDEO CLIP)

AVLON: Now, you fact-check that statement. What did you find?

KESSLER: Well, the problem there is the way deputy campaign manager Stephanie Cutter refers to a bailout, it makes it sound like it's one of those Wall Street bailouts and they got government money, what actually happened was that Bain & Company, which is not the company that Romney was running but the old consulting company he was brought in to rescue, they restructured a loan they had with a failed bank and they restructured a loan with the FDIC which insures bank deposits.

So, the money there was actually not taxpayer money but it was money that was raised from assessment from banks. So, not really a bailout, though if you want to use a broad definition of bailout, rescued from financial distress, the Obama campaign can technically slide by there. But it's intended to give an image that isn't quite correct.

AVLON: So, ultimate verdict, one Pinocchio.

KESSLER: That's right. AVLON: Glenn, thanks for being with us, to help us fact-check the debate.

KESSLER: You're welcome.

OUTFRONT next: we take you to Syria where violence is spreading. And tonight, one of our reporters is on the ground witnessing the violence firsthand.

And new details emerging about the suspect in the movie massacre in Colorado. Could the shooting spree have been averted?

(COMMERCIAL BREAK)

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

We start tonight in Syria. The battle of Aleppo is intensifying as more reports of rebel and regime forces head for Syria's largest and set the stage for heavy fighting. Ivan Watson is in Syria. I asked him what condition the rebel forces are in.

(BEGIN VIDEO CLIP)

IVAN WATSON, CNN CORRESPONDENT: John, I'd say the mood of the rebels is both grim and very determined. After all, these men are losing their comrades in the battle for Aleppo. We've passed funerals for men who were killed in the battle just hours beforehand. Nearly everybody you talk to in Syria has had a loved one who's either been jailed or tortured or killed or has had to flee into exile.

And these fighters see this as an existential fight. Unless they defeat the man whose family has ruled this country for more than 40 years, whose military has been destroying villages and rounding up their loved ones and has killed people in front of their eyes, unless they defeat him, they know that they and their families will be wiped out. This is an "us or them" basically.

And they have no choice, they see, but to win against their government which they see as their mortal enemy -- John.

(END VIDEO CLIP)

AVLON: Our fifth story OUTFRONT tonight, new details just in about the alleged gunman in the Colorado shooting spree. The University of Colorado confirms they discovered a suspicious package sent from James Holmes in a mailroom in their medical campus on Monday. It was addressed to one of homes' former professors. The package reportedly includes writings and drawings about killing people.

OUTFRONT tonight, Ed Lavandera in Aurora, Colorado.

Ed, what else is the university saying about this package?

ED LAVANDERA, CNN CORRESPONDENT: Well, it's been really hard to get people to speak on the record about these packages we've known about since Monday. In fact, it caused the evacuation of some of the buildings on that campus for a short time on Monday. But it was quickly determined there wasn't any explosives or hazardous materials to deal with.

Now we're learning what was inside those packages, perhaps much more frightening to people, that perhaps James Holmes himself mailed this package to a psychology professor, according to NBC and CBS reports this evening, and saying that the packages included writings of killing people and also crude drawings of a gunman and his victims.

So, that package sent, obviously that garnering a great deal of attention today. But there is a gag order in place that has really kind of made a lot of the reaction to this very tight-lipped from official circles here in Aurora today -- John.

AVLON: Disturbing report. Ed, you're also hearing more about Holmes' academic record. What can you tell us about that?

LAVANDERA: Yes, CNN has learned from a source that in early June, James Holmes performed poorly on one of his final exams. This was all about the same time when you go back and look at the time line of when authorities say that he had been over the last two months amassing the guns and the ammunition and the explosive material that was found in his home.

So the question now becomes, this poor performance on this final exam that he had taken toward the end of his first year in this neuroscience PhD program at the University of Colorado, what kind of effect might this exam and this poor performance have on James Holmes? We don't have the answer to that. But you can imagine that is something that psychologists and investors are taking a much closer look at.

AVLON: Ed Lavandera in Aurora, Colorado.

Pierce O'Farrill was one of the lucky ones. He was shot three times in the left arm and the left foot and was just released from the hospital hours ago.

O'Farrill is OUFTRONT with me tonight. I started by asking him about the package that Holmes sent to his professor and what was reportedly inside.

(BEGIN VIDEOTAPE)

PIERCE O'FARRILL, SHOOTING VICTIM: It confirms obviously everything that we kind of know, that this man was just disturbed and that he had a lot of darkness in his heart. It's a shame that that package never got opened. I guess that seems to be the report right now.

And, you know, it just -- in my mind, it just makes it unfortunate that throughout all these years -- I'm sure there's been warning signs. Maybe there was someone in his life at some point that could have seen something coming. But more than anything, it just -- it doesn't change a whole lot really for me at this point.

AVLON: That really does beg the question. I mean, do you think this incident could have been prevented?

O'FARRILL: I mean, gosh, that's just -- I don't know. That's a tough question to answer. I would think someone that's been living with this much darkness in their life -- I mean, I would like to think at some time down his path, maybe someone could have seen this and reached out to him and gotten him the help that he so desperately needed.

AVLON: As you just said, James Holmes will be formally charged on Sunday. What do you think is a just punishment for this man?

O'FARRILL: I think life in prison is a just punishment. I don't believe in the death penalty. Honestly, I've said it before, I will pray for James Holmes, and I pray that he does get life in prison and those 30, 40, 50 years that he's in prison that I pray that the Lord can find him in some way and change his heart.

AVLON: Now, police say that he had an AR-15 assault rifle, a shotgun, two Glock pistols when he went into the theatre. We know he purchased 6,000 rounds of ammunition. While you've been in the hospital, there's been a whole conversation about what could have been done, whether this is an appropriate time to start talking about whether there's certain reasonable restrictions that could have been put in place, that would have made it more difficult to get his hands on these weapons.

What do you think of that conversation about gun control? Is this the right time? Is this too soon?

O'FARRILL: No. I think it's a little premature to get into that conversation about gun control. I think -- I mean, gosh, it was less than a week ago. I think right now we need to have our time of mourning.

And I think more than anything, the conversation has to be about how do we help the families and the loved ones of every victim in there? And not just myself, but more importantly the families of those victims that lost their lives. I mean, my heart just goes out to them. And I think that -- it's way too early to even start having that conversation about gun control.

AVLON: What do you want to say to Holmes?

O'FARRILL: I want John to know that I forgive him, but more than anything, I pray that he can find some regret and that he can find that place in his where it's time for him to regret and to ask for forgiveness from the victims of all of this terrible tragedy.

AVLON: That sense of forgiveness is an inspirational act of grace for us all. What are your plans now that you're out of the hospital? What's next for you?

O'FARRILL: You know, just recovery. I need to definitely focus on just recovering. I'm pretty tired. It's been such a long road, this past week, that I'm looking forward to laying around for a while recovering.

The recovery just lasts a couple of days because on Sunday we're going to have a special service at my church and I will be up there with my pastor and we'll be talking about this and really just talking about forgiveness and ways to reach out and just talking about the grace and love of Jesus and how he's been working to shine his light throughout this horrible tragedy.

AVLON: Pierce, our thoughts and prayers will continue to be you throughout your recovery. Thank you for coming OUTFRONT.

O'FARRILL: It's my pleasure. Thanks for having me. God bless you.

(END VIDEOTAPE)

AVLON: Next, shocking comments from the former CEO of Citigroup today. Will it change the way Wall Street does business forever?

(COMMERCIAL BREAK)

AVLON: I saw something jaw-dropping today.

This is Sandy Weill, the former CEO of Citigroup, the creator of the first mega monster bank back in 1999 on CNBC this morning.

(BGIN VIDEO CLIP)

SANDY WEILL, FORMER CITIGROUP CEO: I think what we should probably do is go and split up investment banking from banking.

(END VIDEO CLIP)

AVLON: Now, this is the guy who had a portrait of himself with the slogan, shatter of Glass-Steagall on the wall of his office.

So, what's Glass-Steagall and how does it matter? Well, here's how Aaron Sorkin explained during a recent episode of the new HBO show, "The Newsroom."

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: After the Great Depression, Congress wanted to put a firewall between the investment banks and the commercial banks. It passed a law, the Glass Steagall Act. It helps lead the largest sustain period of economic growth in U.S. history, a 60-year expansion in the middle class, the largest increase in productivity and the largest increase in median income.

And you know what happened next? We repealed Glass-Steagall.

(END VIDEO CLIP)

AVLON: So, now, Sandy Weill wants Glass-Steagall back, even though he was arguably the biggest reason for its demise. "Reuters" financial blogger Felix Salmon sent me an e-mail that said, "OMG, WTF, shorter Sandy Weill: it was a great idea to open that stable door, but it's a pity the horse has bolted. Let's close the door now. Remind me why we're still taking this clown seriously?"

And "New York" magazine compared to this epic flip-flop to Rick Santorum announcing he's going to be a GLAD spokesperson.

Now, a cynic would say it's just Sandy Weill's way of saving his soul and asking for an apology. But maybe he did see the light. After all, we've now seen a post-Glass Steagall world. We know the wisdom of some of those earlier restraints on unbridled self interest.

Weill's comments may be hypocritical, but they're also historical, in an after the fact sad footnote sort of way. But maybe it will invoke a constructive conversation about restoring it, in whole or in part. After all, here's Glass Steagall, all 37 pages of it. And here's Dodd-Frank, 2,319 pages.

Now, we're not out of the fiscal storm yet. And the clarity and simplicity, something like Glass Steagall, well, might just help stabilize our collective ship.

Erin is back from Africa tomorrow. She'll be talking about Facebook. The tech company will release its first quarterly earnings report since going public. Erin will be breaking down the numbers, OUTFRONT tomorrow night 7:00 p.m. Eastern.

Thanks for watching. "A.C. 360" starts right now.