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ANDERSON COOPER 360 DEGREES

Flood Fears; Obama Says No Thanks to Public Financing

Aired June 19, 2008 - 22:00   ET

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


ANDERSON COOPER, CNN ANCHOR: Tonight, breaking news is how we begin, fighting the floods.
They have seen the bad. They're about to see worse. One by one tonight, the levees are breaking. Officials say they expect further breaches throughout the night. We are going to take you where four have failed already. Another is barely holding. And everyone with the strength to do it is sandbagging as fast as they can. That, how this all unfolded, what's next, and whether all those levees were a disaster waiting to happen. We're "Keeping Them Honest."

Also tonight, campaign cash -- Barack Obama coming under fire for turning down federal financing and the rules that come with it. Republicans say he's flip-flopping. Obama says they're cheating. So, the question is, who is spinning here? We have got the "Raw Politics."

And more breaking news in a manhunt for a millionaire fugitive. Have you seen this camper? Take a look. A fugitive Wall Street tycoon may have used it to escape after faking his own death. It's not the only break in the mystery tonight. There is an arrest. We will have details ahead.

We begin, though, with the breaking news and failing levees.

Today, the Mississippi River went over, under and through them. According to the Army Corps of Engineers, four dozen levees, from Dubuque, Iowa, to Saint Louis, Missouri, are either compromised or in danger of failing. That means everywhere the water isn't and the levees are., there's a race going on to build the fences, people filling sandbags, neighbors helping neighbors, fighting hand in hand against nature.

President Bush and John McCain visiting the flood zone today, separately, it should be noted, federal relief being promised, FEMA supplies already on the ground. Sadly, it's all needed right now in places like Winfield, Missouri, where the water is rising and it's begun flowing into the town.

360's Gary Tuchman joins us now from the middle of the action.

Gary, what's the latest?

GARY TUCHMAN, CNN NATIONAL CORRESPONDENT: Anderson, Winfield, Missouri, is in a very precarious state. Right now, I'm surrounded by hundreds of volunteers who are filling up sandbags, sandbag that will be taken to levees that are still working. And they're trying to protect their town.

But, unfortunately, the deluge has already begun.

(BEGIN VIDEOTAPE)

TUCHMAN (voice-over): In Winfield, Missouri, fear is building, along with the floodwater. Three hours earlier, there was no water on the street. Now it's flowing in. Many houses are starting to get submerged.

UNIDENTIFIED MALE: All of these houses are toast.

TUCHMAN: Several different levees in this area north of Saint Louis have failed in spectacular fashion. And you can see the water starting to roll down the street.

Jessica Rhodes (ph) is the mother of a toddler and has another on the way.

(on camera): Where is your house?

UNIDENTIFIED FEMALE: The white one on the right.

TUCHMAN: So, your house is down there?

UNIDENTIFIED FEMALE: Yes.

TUCHMAN: So, your house is in the water?

UNIDENTIFIED FEMALE: Yes.

TUCHMAN: Wow. How much damage do you have right now?

UNIDENTIFIED FEMALE: I don't know. I didn't walk all the way down there.

TUCHMAN: Are you scared to look?

UNIDENTIFIED FEMALE: Yes. I will break down crying.

(LAUGHTER)

UNIDENTIFIED FEMALE: I don't want to look. I don't want to see it.

TUCHMAN (voice-over): There is another major levee that has not failed off yet, but all bets are off if it does. National Guard members feverishly spent the day piling sandbags on the levee. The Mississippi River is on the right. Winfield is on the left.

JEFFREY WESTMORELAND, NATIONAL GUARD: It feels good to be out here helping the people help save the town.

TUCHMAN (on camera): The Mississippi River is about three miles behind me. But if this water goes even one-tenth of a mile farther this way, an entire neighborhood will be under the floodwaters. (voice-over): Volunteers from throughout the Midwest are filling hundreds of thousands of sandbags to help save towns like Winfield.

UNIDENTIFIED MALE: We got an e-mail and it said that they some help sandbagging. So, we came down here.

TUCHMAN: The river may stay at peak levels through next Wednesday. So, the worst is likely still to come.

UNIDENTIFIED MALE: If you ain't scared, you're a fool.

(END VIDEOTAPE)

COOPER: Gary, it's so great to see so many people out there helping, in some cases, complete strangers. How is the morale of those folks behind you holding up?

TUCHMAN: Well, Anderson, it's incredible. There's a thunderstorm waning right now, but everyone is still here.

I counted 300 people earlier. And I think it's still around the same right now.

(HORN BLARING)

TUCHMAN: That's a truck that's moving in to take these sandbags away.

But the morale is very high, because sandbags can literally save part of a town or save a whole town when they're placed properly on a levee.

They're from all over, too.

Ma'am, Miss, quick question for you. Where are you from?

UNIDENTIFIED FEMALE: I'm from here, Winfield, Missouri.

TUCHMAN: So, you're trying to protect your own town.

UNIDENTIFIED FEMALE: Of course.

TUCHMAN: How is it going so far?

UNIDENTIFIED FEMALE: Pretty good.

TUCHMAN: Backbreaking work, right?

UNIDENTIFIED FEMALE: Yes, it is. This is our third day doing it.

TUCHMAN: That's really nice to hear.

Thanks for talking to us, folks.

And these people right here, where are you from? UNIDENTIFIED MALE: (OFF-MIKE)

TUCHMAN: How far is that from here?

UNIDENTIFIED MALE: About four miles.

TUCHMAN: Forty miles?

UNIDENTIFIED MALE: Four.

TUCHMAN: Oh, four miles. So, you're trying to protect your own town, too?

UNIDENTIFIED MALE: Yes.

TUCHMAN: You're working up a good sweat.

UNIDENTIFIED MALE: Yes.

(CROSSTALK)

TUCHMAN: It's nice that you're out here.

UNIDENTIFIED MALE: Thank you.

TUCHMAN: You know, Anderson, this is kind of like an ant colony, and I mean that in a very positive way. The industriousness here is unbelievable. People really think they can make a difference.

And we have seen this when we have covered floods before, that enough sandbags can save an area. And even though the water has arrived, they're hoping to save most of this town. But this town was hit hard 15 years ago, and, of course, right now, it's very vulnerable once again -- back to you.

COOPER: You know, Gary, that woman says she has been out there, I think, three or four days. I mean, this is not easy work. Those sandbags are incredibly heavy. This is just thankless, thankless work.

TUCHMAN: I'm going to show you, Anderson. It's hard to demonstrate weight, but I'm going to try to pick this up with my left hand, which is my weak hand.

And it's a good workout. You can't do a curl with this. I can tell you that much. It's heavy. And you see little kids picking this up together, like you see 5- and 6-year-olds, like five of them grabbing the bags and putting it in the trucks. It's hard work, but it is extremely, extremely rewarding for these people.

COOPER: Well, it's great that they're out there.

Gary, thanks.

If there is any consolation for the folks sandbagging Winfield, Missouri, tonight or elsewhere, it's -- well, it's that they're not alone. You're going to find men and women, young and old, as you saw, in just about every city and town for 200 miles up and down the Mississippi, doing what they can, trying to protect their homes, their communities. And some are just there to lend a hand to neighbors in need.

Let's try to understand the scope of this flood and try to see where the water may be heading next.

Severe weather expert Chad Myers joins us in Atlanta.

Chad, can we say where the flood's going next?

CHAD MYERS, CNN METEOROLOGIST: Well, it's going towards Saint Louis.

We're starting all the way up into Canton, and Quincy, and Hannibal, and it is headed downriver. But now there are a number of variables involved at this point in time. The variables are the levee breaches and the breaks, because a one-mile-wide Mississippi River rolling down the river, when you break a levee, all of a sudden, that river gets to be six miles, five miles wide, where it's supposed to go.

That's why they call it the floodplain in the first place. So, when you get it down to be a five-mile-wide river, it slows down. The water doesn't go as fast. It deposits a lot of silt. That's why the Mississippi River area there is so fertile. This is the most fertile -- some of the most fertile farmland in the entire country, which is kind of like playing roulette.

Nine years out of 10, you're going to have a great crop. But you have great soil. But that one year, it's going to be absolutely gone.

So, where do we start? Canton -- Canton Sunday. This is where this water is still going up in Canton, but a break across the river, you may have heard of this break. It was the Meyer, Illinois, break. That relieved a lot of pressure. The water was actually down four feet from where it was on Tuesday right now. But it's still forecast to go back up in -- on Sunday and then start to fall.

Hannibal, Missouri, now, you're going downriver a little bit more. There were other levee breaks here around Hannibal. And that was actually on the other side. And good news, every time a levee breaks across the river from a big town, that relieves the pressure on the levees near the town.

Now, there are still people, and a lot of people and buildings, under water. But mainly, I would -- 90-something percent of this flood is an agricultural flood, flooding agricultural lands that have been flooding for tens of thousands of years.

Let's go down to Hannibal, Missouri. This town was really in a bad way at one point in time before the levees broke upstream. This levee was supposed to be at 31.8 feet. That's how high they were building it. They were even putting more sandbags on top. And the crest was going to be 31.9. Well, now it's not going to be that high. It's going to be in the 28 range.

And, so, the emergency managers there are kind of taking a big sigh of relief. Clarksville and Winfield, you heard about all the levees breaking around Winfield. Anderson, those were agricultural levees made to withstand a 14-year flood, not a 100- or 500-year flood, like this is.

COOPER: Just -- just the pictures are unbelievable.

MYERS: They are.

COOPER: We will be watching where this goes all weekend long.

It's hard to really get a -- Chad, thanks.

It's hard to get a bird's-eye view of what's happening in the Midwest. It all threatens really to start sounding the same, kind of looking the same. But it's important to remember, each day, the water is changing. And so does the struggle against it. We don't know what's going to happen in the days ahead, but what we have already witnessed is simply unforgettable.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: There it goes.

COOPER (voice-over): The images are still hard to comprehend, homes slipping away, shredding apart, swallowed into Lake Delton, Wisconsin. At least, it was a lake before last week. Today, it's almost completely dry, the village one of the first casualties of a growing catastrophe.

UNIDENTIFIED FEMALE: You know, we're fortunate. You know, we're safe. We have got our kids. We have got our pets, you know? Our house is just gone.

COOPER: These unforgettable floods began in late May, with days of rain across much of the Midwest. The downpours first drenched Illinois and Indiana, but the greatest damage was about to unfold west, in Iowa.

By mid-June, stunned residents watched as a levee holding back the Cedar River broke, sending water rushing into Cedar Rapids, submerging city hall.

UNIDENTIFIED MALE: I have been through the building thousands of times over the last 17 years.

UNIDENTIFIED MALE: Look at this.

UNIDENTIFIED MALE: Floating.

UNIDENTIFIED MALE: And this is a perspective that you would never, ever dream of having to witness.

COOPER: More levees in Iowa, Wisconsin, and Indiana squeezed by the pressure were either breached or overtopped. In Iowa alone, all but 16 of the state's counties were declared disaster areas, 35,000 people evacuated.

As the flooding grew worse, so did the death toll. At least two dozen people have been killed in the Midwest, among them a man who drowned in his car outside of Indianapolis. Five days ago, up north, the rain finally stopped. But southward, along the Mississippi River, the water overtopped a levee near Gulfport, Illinois, and submerged the town.

Trying to save their homes and help their neighbors, thousands have placed sandbags along the river. In all, FEMA says it has provided nearly 13 million sandbags.

But in places like Meyer, Illinois, they are of little help. In Winfield, Missouri, another levee break, another community under water -- that was yesterday. Today, as the disaster makes its way to Saint Louis, 20 levees have collapsed. Dozens more are at risk of breaching. Millions of acres of crops have so far been destroyed. And many of those forced out by the floods may never go home again.

(END VIDEOTAPE)

COOPER: We're of course going to be following any developments on this throughout the night.

Check our new Web site to see a slide show on the many different ways a levee can fail. The new site just launched today, the address AC360.com. It's a new address, pretty easy to remember, AC360.com. You're going to see a new look for all the great stuff that hundreds of thousands of you are clicking on, the blog, "Beat 360," "The Shot," a lot more.

Of course, we're also live-blogging tonight. That's at AC360.com.

Up next: a troubling update on a vital stretch of levees a bit downriver. We are going to have more on this breaking news. The Army Corps of Engineers knew about some of their shortcomings -- the shortcomings of these levees long ago. The question is, what are they doing about it? We're "Keeping Them Honest," but the fate of a big city may be hanging in the balance tonight.

Also ahead tonight, "Raw Politics": campaign cash -- and a lot of it potentially -- Barack Obama today refusing federal campaign financing and limits on how he can spend his massive war chest. Is he flip-flopping or just refusing to play a game that he says is rigged against the Democrats? We're cutting through the spin ahead.

Also, more tonight breaking news in the case of the fugitive Wall Street crook. He tried to fake his own suicide. Police have made an arrest -- not him, but they do have a lead, a photo of a vehicle they're searching for. We will show it to you, so you can join in the search to try to catch him -- tonight on 360.

(COMMERCIAL BREAK) COOPER: Flooding tonight in Winfield, Missouri, water there literally pouring down streets, rising by the minute -- four local levees already breached or overtopped, another one in danger of going next.

Thankfully, the situation is not yet so dire just a little downriver in East Saint Louis, Illinois. Then again, a lot more people live there. And levees built by the Army Corps of Engineers have already started leaking in the city. What's more -- what's worse, even, the Corps has known about their potential weaknesses for years.

CNN's Drew Griffin is "Keeping Them Honest."

(BEGIN VIDEOTAPE)

DREW GRIFFIN, CNN INVESTIGATIVE CORRESPONDENT (voice-over): On the Illinois side of the great river, East Saint Louis is sitting precariously in the path of a potential disaster. And all that protects it and its residents from the floodwaters of the Mississippi are four levees that no one can guarantee will hold.

TIMOTHY KUSKY, SAINT LOUIS UNIVERSITY: These ones have already been determined by the Army Corps of Engineers, by FEMA, to be structurally deficient and in danger of failing at heights above 40 feet.

GRIFFIN (on camera): And I see all -- I see hotels. I see a casino. I see all of downtown East Saint Louis. We're not talking about acres and acres of flooded corn here.

KUSKY: No. We're talking about 155,000 people who live here. We're talking about 50,000 jobs. We're talking about an oil refinery. We're talking about major businesses. We're talking about major development in this part of the country.

GRIFFIN (voice-over): Tim Kusky, professor of national sciences at St. Louis University, is one of the foremost experts on what causes levees to fail. He outlined in a book exactly how New Orleans levees would fail two years before it happened. Now he's concerned what happened in New Orleans after Hurricane Katrina could happen here.

The immediate fear is subterranean cracks -- leaks in these earthen dams that will expand as the pressure from the rising floodwaters continues. It's called seepage. Enough seepage can create the kind of blowout that could erode the levee from the bottom up.

At one stop on our tour, the professor pointed out it's already happening.

KUSKY: This is water that's come underneath the levee. I'm pretty certain that this is water coming from underneath the levee.

ROBERT BETTS, EAST SAINT LOUIS CITY MANAGER: This is serious. This is serious business here. The this great Mississippi doesn't play. And it's showing you that today. As we stand here now, we see the water seeping underneath our feet.

GRIFFIN: East Saint Louis City Manager Robert Betts is now reviewing the city's evacuation plan and says he will have inspectors monitoring for more leaks until the immediate danger passes.

But this is not a new problem. Last August, the Army Corps of Engineers concluded, the levees that are supposed to protect Metro East Saint Louis are at risk of failure due to structural deficiencies. The Army Corps has offered to help the three counties in the areas try to fix the problem, but says it will take time and more than $100 million.

Drew Griffin, CNN, East Saint Louis, Illinois.

(END VIDEOTAPE)

COOPER: Well, we will watch that.

Up next: raw cash mixed with "Raw Politics" -- Barack Obama saying he's opting out of public financing for the November elections. He's going to use the money he's raised on his own instead. It's a lot of money. Is he breaking a promise? Well, you can be the judge ahead.

Plus, our other breaking story tonight -- new developments in the search for this man, Samuel Israel, a convicted multimillionaire hedge fund manager on the run. An arrest has been made -- not of him, however. We will tell you who cops nabbed and why and how you may help them find this fugitive.

Also tonight, the floating feet mystery -- five human feet washing up on a beach. Now investigators say a sixth one was a hoax. But where did the five real ones come from?

When 360 continues.

(COMMERCIAL BREAK)

COOPER: More breaking news tonight: a stunning development in the manhunt for Samuel Israel. You might remember he's the hedge fund manager who stole hundreds of millions of dollars from investors.

Instead of showing up for prison, authorities believe he staged his own suicide, parking his car on a bridge in Upstate New York. Far from taking his own life, Israel is believed to be on the run, a fugitive. And, tonight, in a surprising turn of events, his girlfriend was arrested.

CNN's Randi Kaye has been following the story, joins us now with the latest -- Randi.

RANDI KAYE, CNN CORRESPONDENT: Anderson, here is what we know tonight. Federal prosecutors here in New York have charged Debra Ryan with aiding and abetting Samuel Israel. Ryan is believed to be the live-in companion of Israel. And the complaint says she helped him avoid prison and elude authorities.

According to the complaint, Ryan initially told investigators she had no idea where he was after he failed to surrender for his prison sentence. But then she changed her story, and in a big way. The complaint says Ryan admitted to helping Israel escape justice.

On June 9, she allegedly followed him in her car, while he drove an R.V. to a highway rest stop near their home in Armonk, New York, about an hour outside Manhattan, before both then drove back to their house. He never surrendered on June 9. Instead, his SUV was found on a bridge with the words "Suicide is painless" scrawled on the front hood. That was the theme saw to the hit TV show "MASH."

Now, authorities doubted Israel killed himself. And now they are convinced he is a fugitive. They believe Israel is driving -- take a look at this here -- this white R.V. It is a 2007 Coach Freelander recreational vehicle. It has New York license plates. The number is EEN-5973. The R.V. may also have a hydraulic lift in the back. And that may be carrying a blue 2005 Yamaha scooter.

So, even though he pleaded guilty to a white-collar crime, we also want to mention that authorities consider Israel, Anderson, to be armed and dangerous.

COOPER: So bizarre. Such a weird story.

Erica -- Randi...

(CROSSTALK)

KAYE: She's off.

(LAUGHTER)

COOPER: I know she is.

(LAUGHTER)

COOPER: Randi, thanks.

We will have more with Randi coming up.

Still ahead tonight: Senator Obama says he's not going to accept about $85 million in public funds when he becomes the Democratic presidential nominee. John McCain calls the decision disturbing. We have got the "Raw Politics."

Also ahead, Cindy McCain clarifying her comments about Michelle Obama and patriotism. Is she actually attacking her again, though? We're going to let you decide.

And here's tonight's "Beat 360" photo. Randi, feel free to play along.

KAYE: OK.

COOPER: Will Smith and Charlize Theron pose at Moscow International Film Festival, promoting their latest film, "Hancock."

(CROSSTALK)

COOPER: Here's the caption from our staff winner, Joey: "Can we get the cast of 'Ugly Betty' out of my shot?"

KAYE: Oh, boy.

COOPER: Anyway.

KAYE: Joey always wins.

COOPER: He does. He wins a lot.

(LAUGHTER)

COOPER: Think you can do better?

Go to our -- he's most clever member of our 360 team on -- for "Beat 360."

KAYE: Yes, he is.

COOPER: Go to our Web site, AC360.com. Click on the "Beat 360" link. Send us your entry, or your entree. And we will announce the winner at the end of the program tonight.

(COMMERCIAL BREAK)

COOPER: Well, by far, the most explosive story today in the presidential race was Barack Obama's decision to turn down federal financing.

His announcement sent the spin machines into overdrive on all sides, frankly. Republicans say he's flip-flopping. And it is a change of position for Senator Obama, no doubt about it. He claims the system is broken and works against Democrats. And that's why he says he's not doing it.

Now, whether you support the move or oppose it, one thing most observers agree on: By doing this, Obama has all but guaranteed himself a big financial edge.

CNN's Candy Crowley has all the "Raw Politics."

(BEGIN VIDEOTAPE)

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT (voice-over): If you raise more than a quarter-billion dollars in the primary season, would you limit yourself to $85 million in the fall campaign? Duh.

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: Hi. This is Barack Obama. I have an important announcement. And I wanted all of you, the people who built this movement from the bottom up, to hear it first. We have made the decision not to participate in the public financing system for the general election.

CROWLEY: In a Web video announcement, which includes a handy donate link dear, Barack Obama made history. He will become the first presidential nominee to refuse public financing in a general campaign. Legal and expected, all would be OK except for the video trail of this kind of thing, dateline: New Hampshire, April 2007.

(BEGIN VIDEO CLIP, APRIL 3, 2007)

OBAMA: I have been a public supporter of public financing since I got into politics.

(END VIDEO CLIP)

CROWLEY: And, in late November, Obama responded to and then signed a questionnaire stating, "I will aggressively pursue an agreement with the Republican nominee to preserve a publicly financed general election."

A decided underdog in the money chase, John McCain still believes he has a political issue.

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: And this is a big deal. It's a big deal. He has completely reversed himself and gone back, not on his word to me, but the commitment that he made to the American people. That's disturbing.

CROWLEY: Aboard the very symbolic Straight Talk Express, McCain drew the bright line, telling reporters he will take public funding, because he said he would.

McCain's campaign helpfully provided a timeline of Obama's evolution on the subject, while the Republican National Committee plucked some primary quotes from Hillary Clinton shortly after Obama began to send off signals he would opt out of the campaign finance system.

"Now," she said, we're seeing how the words don't even mean what we thought they meant."

Lawyers for both campaigns have slightly different versions on whether there was ever any serious talk about an agreement. But it doesn't change the bottom line. This fall, Obama will be able to spend what he can raise, the fuel he needs as he tries to define himself to a public still learning about him.

The first ad of his general campaign goes up Friday.

(BEGIN VIDEO CLIP, OBAMA CAMPAIGN AD) OBAMA: And if I have the honor of taking the oath of office as president, it will be with a deep and abiding faith in the country I love.

(END VIDEO CLIP)

CROWLEY: Obama's decision not to take public funding is criticized each by some friends as a mistake. And it's hard to spin his position as anything other than a 180.

But Obama advisers try. They argue the campaign is the reform everyone talks about, fueled largely by low-dollar donations from donors who don't even expect a thank-you note in return.

Candy Crowley, CNN, Washington.

(END VIDEOTAPE)

COOPER: Well, what do you think? Is this hypocrisy from a candidate who has promised Americans no more politics as usual? The McCain campaign is spinning it like that.

Let's dig deeper, though.

Earlier, I talked with CNN contributor Bill Bennett, who is also a Washington fellow with the Claremont Institute, and James Carville, CNN political contributor and former Clinton adviser.

And I started by asking Bill Bennett whether voters really care if a candidate flip-flops on this particular issue.

(BEGIN VIDEOTAPE)

BILL BENNETT, CNN CONTRIBUTOR: People have -- as I wish John McCain had learned a log time ago, people are not overwrought about campaign finance issues. They really aren't. He may be, and a few others may be.

But Obama changed his mind. He misrepresented his view. He said he wanted to go with campaign finance, the public financing. Then, all this money started to fall like leaves off the trees, so, show me the money. And the money made him change his mind.

It's disappearing. Fred Wertheimer said that. He's no Republican. The guy used to be with Common Cause. It's very disappointing. It doesn't look like new politics.

(CROSSTALK)

COOPER: James, you don't look...

(CROSSTALK)

JAMES CARVILLE, CNN POLITICAL ANALYST: Yes.

Well, it's kind of funny that, here, McCain shifts his position on offshore drilling, and they're worried about somebody on Obama's staff saying, well, if McCain does it, we don't do it.

I think that -- I don't blame the McCain people for being a little angry, because Senator Obama is going to raise like a gazillion -- I think he's already raised like $272 million.

BENNETT: He will raise a lot of money.

CARVILLE: He had a -- yes, he had a million-and-a-half contributors. That's more contributors than the Republican Party will get in the next four years.

(CROSSTALK)

BENNETT: Yes, it's show me the money. It's not show me the principle. That's for sure.

CARVILLE: Again, again, again, Senator -- Senator McCain has changed his position on a really important issue that affects the people. And that's this offshore drilling...

BENNETT: Right.

CARVILLE: ... where, somehow or another, we're going to drill our way out of this foolishness.

(CROSSTALK)

BENNETT: Changing your position on offshore drilling is a good idea for the people. Changing your idea on public financing is a good idea for Obama's money.

COOPER: Bill, do you buy Obama's argument that, well, look, the system is broken, and that's how come I'm doing this, that people -- that Republicans can game the system, basically, with this 527s, and the GOP raising money on the side? Do you buy that?

BENNETT: Anderson, was it not broken before? Did the system just break in the last two weeks or two months? No.

I mean, what's the difference that's occurred in the last two months? They saw how much money they could raise. It was the money that turned his head, not principle.

CARVILLE: Let me point out that Senator Obama takes no PAC money, and nobody has had a greater contributor -- contributor base of small donors than Senator Obama. So, I'm quite comfortable with his position on this. And I'm very comfortable with his position on energy policy.

(CROSSTALK)

BENNETT: Let me point out John McCain often takes on interests in his own party. Barack Obama never takes on interest in his own party, never.

CARVILLE: Yes, very comfortable with his energy policy. And I noticed that Senator McCain went to Houston to really take on big oil by saying, drill wherever you want.

BENNETT: Yes.

CARVILLE: And, so, if we need more big oil in this country, then vote for John McCain.

(CROSSTALK)

BENNETT: We need big oil and little oil. We need oil. We need oil.

(END VIDEOTAPE)

COOPER: Just ahead: Barack Obama pushing his patriotism. That ad you saw in Candy's piece, his first ad for the general election, starts airing tomorrow. It's heavy on his love of America and Midwestern roots -- what it says about his strategy ahead. Bill and James will weigh in.

Also, Cindy McCain and what she says she really meant when she spoke out about Michelle Obama and her own patriotism.

Stay tuned.

(BEGIN VIDEO CLIP)

CINDY MCCAIN, WIFE OF JOHN MCCAIN: No, it wasn't political, and there was nothing planned. It was -- I'm just -- I'm an emotional woman when it comes to service to our country. I've watched many people's children leave and go serve. This is something that is the fiber of the McCain family.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

COOPER: Well, it's clear tonight that the general election playbook is changing for Barack Obama: from his wife's political makeover, what some have called a makeover, that the campaign won't call a makeover, to reports that access to media is being tightened.

The Obama campaign will release its first general election ads tomorrow with a clear takeaway message and some clues about the image control that may be ahead.

We're "Digging Deeper" in part two of my interview with Bill Bennett and James Carville.

(BEGIN VIDEOTAPE)

COOPER: James, the Obama folks have released their first ad of the general election campaign. I want to show our viewers just an excerpt.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (D-IL), PRESIDENTIAL CANDIDATE: America is a country of strong families and strong values. My life has been blessed by both. I was raised by a single mom and my grandparents. We didn't have much money, but they taught me values straight from the Kansas heartland where they grew up. Accountability and self- reliance. Love of country. Working hard without making excuses. Treating your neighbor as you'd like to be treated.

(END VIDEO CLIP)

COOPER: Does the ad work? I mean, who do you think it's aimed for?

CARVILLE: Well, I think what you classically would call a reassurance ad. I remember 1992 our first ad was on welfare reform. And is it going to, like, change the course of the election? No. But is it a smart ad that the Obama people are putting out first? Yes, I think it is. And I think he's going to do a lot of introducing of himself between now and the end of the convention. And I think this is part of a larger strategy to do that.

COOPER: Bill, if Obama has a patriotism problem, as probably some of his critics would say, does this reassure them?

BENNETT: Well, start with Kansas, I guess, and position yourself in the middle as much as you can. This is smart in the sense that he needs to drive to the middle. He needs to get to the center, being the most liberal member of the Senate, according to the "National Journal," being about as far left as you can be and still be in the United States Senate. That means more liberal than Sanders, who is the former socialist Senator from Vermont.

So he's a very liberal guy. Obviously, it makes sense for him to drive to the center.

COOPER: Do you think -- do you think he's to the left of the socialist?

BENNETT: Well, he -- I guess Sanders isn't a socialist anymore. I guess he's become a Democrat. But according "the National Journal" I believe that he is to the left of Sanders.

COOPER: James?

CARVILLE: I would just, for the record, say there's a lot of dispute about the "National Journal" rankings, that even the "National Journal" concedes that. And a lot of it has to do with attendance.

But I'm really not -- I think Obama is a guy who has some pretty solid values. But it does matter. What he's trying to do here is to introduce himself in a way that he's not, in a general election sense -- and I think there's a theme that is going to carry on between now and the end of the convention.

BENNETT: Well, you've got to be yourself, and they're already having some problems being themselves. You had this thing where they removed the people who had the scarves, the women who had the scarves, the head scarves, because they didn't want people to see Muslims in the background of the photograph. So he's trying to position himself as this great middle American candidate. And he'd better be careful. I understand the reasoning is good, but he'd better be careful.

CARVILLE: But again, to be fair to Senator Obama, he had nothing to do with that. That was a staff decision.

BENNETT: Right, right, right.

CARVILLE: ... which I think they subsequently apologized for. Political staffs, believe me, I've been in enough campaigns to know that a lot of candidates don't know what's going on, and it's not unusual at a political set-up to make a sort of mistake like this.

BENNETT: So we can expect to see a lot of hooded scarves in the future?

CARVILLE: I wouldn't see anything wrong with it. I would like to -- in fact, I think we need Arab-Americans to be in the background. I think it's good for our image. And I hope that they're there.

BENNETT: And I'll tell you, if that happened on the Republican side, we'd be talking about it a lot more. It would be a lot more focus of attention.

COOPER: James, do you think -- "The New York Times" reported today that they're already starting to limit access to Obama in terms of reporters, that they feel maybe he's been a little too accessible. You know, there's been this incident with the head scarves.

Clearly, they are moving into a general election campaign and tightening things up. Does that make sense to you or are there concerns in there in doing that?

CARVILLE: Well, I mean, I think that they are moving to more of a general election thing, and they can't give access to everybody. I've been through a general election in '92, and it's more intense now than it even was then.

I think if they pull him away from the press it would be a mistake, but I don't think they have any intention of doing that. And I mean, you can't imagine how many interview requests and everything that a guy like Senator Obama gets right now.

And you know, everything becomes -- you know, these stories that get blown up. I would suggest that, by doing interviews and making news himself -- if you don't make news in the course of the day, one thing I've learned is other people will make the news for you.

So there will be this kind of head scarf story, which is -- in one sense is not much of a story. But that's what the story is if you're not making news. So I think backing away from the press, by and large, is a mistake because they're going to fill the hole with something. COOPER: Bill, it's interesting that the McCain campaign, some of his advisers have come under criticism for not protecting their candidate enough, putting him on this huge night two weeks ago or so, putting him in front of this green backdrop in kind of a small crowd.

BENNETT: Yes.

COOPER: Are they -- are they ready for a general election?

BENNETT: Well, I mean, they're not -- they may not be ready for John McCain. John McCain will not do what Barack Obama and, apparently, Michelle Obama will do, which is take construction. He will do whatever he daggone well pleases. But it is interesting, isn't it?

COOPER: You don't think he takes any instruction at all from high-paid consultants?

BENNETT: Very little. I think he listens, but I think he damn well does what he wants to do. That's the McCain I know. I've talked to him a few times. That's my sense.

COOPER: General election has definitely begun, guys. Thanks very much.

BENNETT: Thanks.

CARVILLE: All right.

(END VIDEOTAPE)

COOPER: Two very different points of view.

Up next, Cindy McCain on Michelle Obama. She tells our John King what she says she really meant when she suggested Michelle Obama was being unpatriotic.

Also ahead, sounds like someone out of a horror movie. Five human feet wearing running shoes washed up along the coast of British Columbia, Canada. A bizarre story. It is real. Investigators are scratching their heads, trying to figure out where are the bodies? Details coming up.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

MICHELLE OBAMA, WIFE OF BARACK OBAMA: I tell people just imagine the pride that my parents, who didn't go to college felt, that they could, through their own hard work and sacrifice, have us achieve things that they could never imagine.

So I am proud of my country, without a doubt. I think when I talked about it in my speech, what I was talking about was having a pride in the political process.

(END VIDEO CLIP)

COOPER: Just a day after Michelle Obama appeared on "The View" there to perhaps try and soften her image or clarify the comments that sparked so much controversy, she drew more fire from Cindy McCain.

In an interview on "Good Morning America," Mrs. McCain was asked about Mrs. Obama's remark and didn't cut her any slack. Take a look.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Were you insulted when Michelle Obama said that she's proud of her country for the first time?

C. MCCAIN: It wasn't about being insulted at all. I don't know where -- why she said that. You know, everyone has their own experience. I don't know why she said what she said. All I know is I've always been proud of my country.

(END VIDEO CLIP)

COOPER: Interpret that as you will. When that taped interview aired this morning, Cindy McCain was actually thousands of miles away in Vietnam.

CNN's John King caught up with her at a mission run by Operation Smile, a nonprofit who repairs facial deformities in children across the world. The group's work strikes close to McCain's heart. McCain's youngest daughter, adopted from Bangladesh, was born with a cleft palate, which was later fixed with surgery.

Now, tomorrow, Mrs. McCain's going to visit Thailand, where she'll be briefed on relief efforts in Burma. Myanmar still really, of course, from the devastating cyclone. She talks about all of this and about her remarks about Michelle Obama with John King at Operation Smile in Vietnam. Take a look.

(BEGIN VIDEOTAPE)

JOHN KING, CNN CORRESPONDENT: Is this -- this stop here for Operation Smile, going on to talk about the relief efforts and to criticize the regime, is this is a snapshot of what Cindy McCain would do as first lady if your husband is fortunate enough to win the election? Tell us sort of how you would view that job for you.

C. MCCAIN: Well, I wouldn't change anything I do now. This is -- days like today revive me. This is -- I've been doing this for 28 years, and it's important to me, because it's -- my parents always taught me, you know, we have a very good life. Now it's time to give back.

KING: These are international efforts, Operation Smile, the World Food Program. Is there anything at home you would take on as a priority?

C. MCCAIN: Well, I mean, I have a No. 1 issue that's personal. I had a stroke, so certainly, women's health is extremely important. But also the adoption process is a big part of what I've -- we've been in the adoption process and have encountered it. So adoption, there is a lot of issues that -- that revive me and vitalize me. And I think it needs -- it needs a source of interest and people like me to bring interest to them.

KING: Let's talk about the role of the spouses in the campaigns. Let me start with the threshold question: where is the line in your view? What's in and what's out? As you know, there's been a debate about the spouses, things you have said and done, things Ms. Obama has said and done. Where's the line in your view?

C. MCCAIN: I -- I do not think that -- that spouses and family members -- I'll broaden that -- are fair game. And I'm not saying that because of either treatment on either side. I just think that politics, there has to be some decorum left in politics and in American journalism, as well.

And our husbands are the candidates. And what we're looking at are two vastly different sides of issues, two vastly different approaches to how we govern our country.

It's a very -- people have a very clear choice. The choice is not whether -- who's going to be the best first lady, of course. This is about our husbands, and this is far too important to muddle it up with things like that.

KING: And yet, under steady pressure from the Democrats, your husband has said adamantly for a long time your financial life was separate from his. You wouldn't release your taxes and you were forced, under political pressure, to release the summary. It's not like that?

C. MCCAIN: It wasn't the Democrats that forced it. I felt that, if it was that important to the American people and there was a discussion, I said OK, I will. I mean, sure I said no, but American people said, you know, "We really are -- we really think we should see."

And I said, "OK, that's fine." I don't have to -- you know, I'm not always right.

KING: And now the Democrats are raising a stink about your husband's use of your family jet at a time his campaign was short on money. Is that a relevant question or is that silly season?

C. MCCAIN: It's a relevant question. The rules are very clear, actually. And if you notice today, there was a discussion from three or four different attorneys backing up our -- our discussion and our understanding of the law. It's -- you know, we'll see where this takes us, but our understanding and, from what our attorneys have said, the law was clear and our use of it was very appropriate.

KING: You say spouses should not be the issue. The candidates are the ones who would be president. You did step forward at one point in the campaign when Mrs. Obama had said for the first time she was proud of her country. You did step forward and say, "Well, I've always been proud of my country." You saw a reason to say that? Wasn't it a political move (ph)?

C. MCCAIN: No. It wasn't a political move, and there was nothing planned. It was -- I'm an emotional woman when it comes to service to our country. I've watched many people's children leave and go serve. This is something that is the fiber of the McCain family.

It was nothing more than me just saying, "Look, I believe in this country so strongly." That's all it was. It was an emotional -- an emotional -- an emotional outpouring on my part.

KING: It was taken, as you know, as somehow trying to -- a comment on your part that was trying to say you're more patriotic or her family is more patriotic -- your family is more patriotic.

C. MCCAIN: No, no. That is not how I meant it, and that is not how I believe it was represented. I think she's a fine woman. She's a good mother, and, you know, we're -- we both are in an interesting line of work right now.

(END VIDEOTAPE)

COOPER: That's a good way to put it. Interesting times.

Up next, a mystery that has authorities baffled. Human feet, five of them, washing up on the same shore. What did they belong to? How did they get there? And where are the bodies? Randi Kaye investigates when 360 continues.

(COMMERCIAL BREAK)

COOPER: Tonight, new details in a mystery that has authorities baffled. We don't know if they're connected or just a coincidence, but severed feet have been washing up along one particular shoreline, one foot at a time. By last count, six have surfaced. Five are human.

With tonight's "Crime & Punishment" report, once again, here's 360's Randi Kaye.

(BEGIN VIDEOTAPE)

RANDI KAYE, CNN CORRESPONDENT (voice-over): Take a good look at this sneaker. Investigators say it still has a foot inside of it, one of five feet found on Canadian shores in less than a year.

TERRY SMITH, BRITISH COLUMBIA REGIONAL CORONER: I can certainly tell you I've never run across something like this.

KAYE: Police say two people spotted the foot Monday in the waters between Vancouver Island and British Columbia's mainland. Like the others, it was still wearing a sneaker.

Of the five feet, the first four are right feet. This is the only left one. It's a mystery that has baffled investigators sense the first foot washed ashore in August 2007. Now it's getting international attention. Are they linked? How many more feet might be out there? And how did the victims die?

There is no shortage of theories. Some have suggested the feet belonged to stowaways on commercial ships. Others think it's the work of a serial killer.

ANNIE LINTEAU, ROYAL CANADIAN MOUNTED POLICE: We are reviewing all missing persons files. We are exploring the possibility that it could be people who may have drowned. It could be missing fishermen. It could be the remains of people who may have died in a plane crash.

KAYE: Three years ago, a float plane carrying five men crashed into the sea, not far from Vancouver. Only one body was recovered. This woman's brother, the pilot, was never found.

SALLY FEAST, BROTHER DIED IN PLANE CRASH: Fifty yards away is where the boat took off from, and here we are just on the other side of this, finding a foot.

KAYE: Relatives' DNA is being compared to DNA from the feet.

Forensic scientist Larry Kobilinsky says, even after all these years in the water, investigators can still get a good DNA sample from bones.

(on camera) Do socks and sneakers slow down the decomposition process at all?

LAWRENCE KOBILINSKY, FORENSIC SCIENTIST: Without a doubt. Having the severed part of the body, the foot, encased in a sneaker is going to protect it from decomposition.

KAYE: The sneakers may explain why feet are the only body part that turned up. We checked with oceanographers, and we're told sneakers are so buoyant they can travel thousands of miles in the water, averaging about ten miles a day.

(voice-over) Investigators are focusing on the shoes for clues, too.

LINTEAU: The mate, where the shoe was produced, when and where it was sold to shed some light on the identity of these people.

KAYE: So far, the feet do not appear to have been severed. No evidence of foul play. All the answers, though, will take time.

And the investigation has already been hampered by a hoax. On Wednesday, police were alerted to what was thought to be another foot in a black Adidas running shoe.

UNIDENTIFIED FEMALE: Scared, you know, to think of, you know, that happening to a person and their foot is actually, you know, sitting here on the beach. KAYE: This woman says the sneaker was wrapped in seaweed with two bones sticking out of it. It turned out to be an animal paw. Investigators called the prank reprehensible.

So the search for clues continues, as police try to pair up the feet and figure out just how many victims they have on their hands.

(END VIDEOTAPE)

COOPER: So bizarre. So it's five actual feet at this point?

KAYE: Five human feet. They thought they had six.

COOPER: Just unbelievable. I know you're following other stories in the "360 News and Business Bulletin." What's going on?

KAYE: Anderson, big news linked to Wall Street tonight. The mortgage meltdown has produced its first criminal charges. Two former Bear Stearns managers who ran hedge funds that invested heavily in the subprime mortgage market were arrested today.

Matthew Tannin and Ralph Cioffi are accused of defrauding investors and fellow brokers of more than $1 billion.

Today, the White House said President Bush would veto a plan to help hundreds of thousands of homeowners facing foreclosure. The bill has broad bipartisan support, but some Republicans are concerned the plan could reward lenders caught up in a scandal involving cut-rate mortgages for senders.

And an unused life jacket from the doomed Titanic will be auctioned off this month at Christie's. The cork-filled life preserver is said to be largely in tact but stained and torn in some places. Still, it is expected to sell for as much as $80,000.

So useless, but still expensive.

COOPER: Remarkable to see that.

Time now for "Beat 360."

Tonight's picture shows actor Will Smith and his co-star Charlize Theron at the Moscow International Film Festival, where they're promoting their latest film, "Hancock."

Our staff winner tonight is Joey. His caption: "Can we get the cast of 'Ugly Betty' out of my shot?"

(SOUND EFFECT: Foghorn)

KAYE: Oh, nice.

COOPER: Our viewer winner is Sean from Los Angeles. His entry: "Will Smith hopes to match his earlier success with the new show 'Fresh Czar of Red Square."

KAYE: I've heard of that.

COOPER: You can check out all the entries we received at our Web site. We even made it easier for you to get there. Go to AC360.com. That's a new Web site, AC360.com. Rolls off the tongue.

"The Shot of the Day," Randi, is coming up.

Also at the top of the hour, a catastrophe in the making. More levees breaking. More on the brink as the massive flooding moves south along the Mississippi. We'll have the latest, ahead.

(COMMERCIAL BREAK)

COOPER: Time now for "The Shot." If you missed it, "The Daily Show" kind of took the media to task for the coverage of the Midwest flooding, poking fun at how correspondents wade into the water to do their standup.

That's fine. That's fine. But it got a little personal with one of our own. Listen to what he said about our own Gary Tuchman.

(BEGIN VIDEO CLIP)

JON STEWART, HOST, COMEDY CENTRAL'S "DAILY SHOW": The water was up to reporters ankles. The water was up to reporters' knees. The water was up to reporters' thighs. No! The mind-boggling waist shot.

"I remember in 2008, the water got so high it went right up to Gary Tuchman's nipples.

(END VIDEO CLIP)

COLMES: That is one sentence I never imagined saying on television, Gary Tuchman's nipples.

KAYE: You said it. There you go.

COLMES: We spoke to Gary Tuchman about it, by the way, and Gary is a very good sport. He found it quite hysterical, I'm told.

KAYE: I'm sure he did.

COOPER: Yes.

KAYE: I think it was just a little...

COOPER: Just ahead, Gary Tuchman is in a town where there's nothing to joke about at all. Just a whole lot of water where it doesn't belong and a lot of neighbors pitching in to keep a bad situation from getting worse. We'll take you there, next.

(COMMERCIAL BREAK)