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Automatic Spending Cuts; Groupon CEO's Compensation Examined; Will Ashley Judd Run?; Steep Canyon Rangers Talk Music

Aired March 1, 2013 - 15:30   ET



BROOKE BALDWIN, ANCHOR, "CNN NEWSROOM": Bottom of the hour, I'm Brooke Baldwin.

Technology, sports, business, health, science and showbiz news, we're hitting it all for you right now. We're calling it the "Power Block."

If you listen to free Internet radio on your phone, your tablet, set a clock because, starting today, Pandora is capping free mobile music streaming at 40 hours per month.

Pandora says it doesn't have enough advertisers to keep up with the big hikes in the music royalties.

Users who hit the cap can keep listening to Pandora on a desktop or a laptop computer or pay 99 cents to continue the mobile service until the end of the month.

Who could forget the divorced working mom raising two daughters in the hit TV show, "One Day at a Time." Anyone? That mom was played by Bonnie Franklin. MacKenzie Phillips and Valerie Bertinelli were the daughters.

And, so, Bonnie Franklin, she passed away today at her Los Angeles home after a battle with pancreatic cancer. She was 69.

And, first, the encore brawl, Warriors, Pacers, Tuesday. Now, the fallout. Warriors rookie guard Klay Thompson, not only did the NBA fine him 35 grand, Thompson's father is docking his allowance.

You heard me, allowance. Dad is NBA veteran Mychal Thompson.


UNIDENTIFIED MALE: Klay's checks come to you?


UNIDENTIFIED MALE: And then you give him an allowance?


UNIDENTIFIED MALE: Which is how much a month?

THOMPSON: About, let's see, he's got -- rent is $3,000 then ...

UNIDENTIFIED MALE: So, you cover bills?

THOMPSON: Yeah, cover the bills.

UNIDENTIFIED MALE: And what does he get on top?

THOMPSON: Walking around money? About $300 a week.


BALDWIN: That is some tough love.

Adidas is giving the new meaning to the phrase "March Madness." Take a look at these new uniforms Adidas designed for the college post- season.

They're super bright, sleek shirts, animal-striped pants, anyone? They will be worn by half a dozen teams, Cincinnati, Kansas, Notre Dame, Baylor, UCLA and Louisville.

The new uniforms are anything but a fashion slam dunk, though. In fact, they're getting slammed by critics.

"Girls Gone Wild" going to bankruptcy court. The soft porn company founded by Joe Francis has filed for Chapter XI protection from its creditors.

"Girls Gone Wild" is $16 million in debt despite all the money people spend on adult content.


JOE FRANCIS, FOUNDER, "GIRLS GONE WILD": We're talking about a $13 billion a year industry. The numbers are staggering. Ninety percent of all searches done on the Internet are for adult content.


BALDWIN: "Girls Gone Wild's" biggest creditor is casino mogul Steve Wynn. He's sued Francis several times over gambling debt, defamation and slander and he won.

Groupon CEO Andrew Mason gets the ax and responds with the best exit letter ever.

This is what he wrote. Quote, "After four and a half intense and wonderful years as CEO of Groupon, I've decided that I'd like to spend more time with my family."

He goes on, "Just kidding. I was fired today. If you're wondering why, you haven't been paying attention."

Alison Kosik is at the New York Stock Exchange. And we hear his severance pay, it is $378.36.


BALDWIN: I'm feeling a little bad for the guy.

KOSIK: No, no, no. Don't shed any tears for this guy. He's going to be OK, you know, because he also gets to keep 47 million shares of Groupon that he has and, even though the stock's taken quite a beating lately, it's still worth over $200 million.

As far as that severance you're talking about, it's part of Andrew Mason's contract. The company is obligated to pay out half of his salary and just goes -- coincidence, I guess, he cut his own salary to $756.72 after Groupon went public.

So, you divide that by two, $378.36, yes, that is his severance.

This kind of thing is pretty common, especially in the tech industry for CEOs to do, to drop their salary down to a buck.

Facebook's Mark Zuckerberg, Google's Eric Schmidt, HP's Meg Whitman, they're all in that one-buck club.

Now, Mason, though, he's always been a little quirky as you can tell from that resignation letter. He actually got -- he got a little serious in that letter, though.

He said he's OK with having failed this part of the journey. We, however, are still trying to figure out what the heck is the significance of that salary that he picked, $756.72?

We're trying to figure out if there's something to that number that he's after, so we'll research that and get back to you.

BALDWIN: You did that, Alison Kosik. Thank you so much.

New evidence here of just how devastating it is to be told you have breast cancer. Nearly one-in-four breast cancer patients have symptoms of post-traumatic stress disorder, shortly after receiving their diagnosis. At least, this is according to a study in the Journal of National Cancer Institute.

Researchers say younger women are more likely to report PTSD than the older women, and the risk for black and Asian women is 50 percent higher than for white women.

As cardinals prepare to gather in the Sistine Chapel to pick a new pope, you can play along. Take a look at this with me. It is March, after all, folks.

These are the brackets for, stay with me, the "Sistine" -- "Sweet Sistine Challenge: from Religion News Services. RNS predicted each continent's top candidates for pope, boiled it all down to the Vatican version of the "Sweet Sixteen."

So, to play, and you can, go over to The first round of voting ends tonight at midnight Eastern. Liftoff, but problems, problems for the unmanned Dragon cargo capsule. Three of its four thrusters actually hit a glitch shortly after separation this morning from its Falcon 9 rocket.

But, engineers, they are making progress here, they have two thrusters up and running, have Dragon now under control.

The spacecraft belongs to the private company SpaceX. It's under contract with NASA to carry supplies all the way up to the International Space Station, and this is the second resupply mission under the SpaceX/NASA deal.

Coming up, Ashley Judd is speaking live in Washington right now, but is the visit to D.C. a sign of something else? That's next, "Political Pop."


ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: From the CNN studios in Washington, D.C., I'm Ali Velshi. This is "Your Money."

While it is not clear what the effect of the forced spending cuts will be on most Americans, many will be surprised to learn, perhaps the hard way, because of those cuts just how much the federal government touches their lives.

Political conservatives believe the private sector should do many of the things the government does because it's more efficient.

Liberals argue only government can handle many key public services because it isn't bound by market pressures the way the private sector is.

This isn't just debated here in America. It's a burning issue all over the world.

That's why it is time for a little Q&A, Quest and Ali, with my good friend Richard Quest in London. He's the host of "Quest Means Business" on CNN International.

What does government handle better than the private sector? Sixty seconds on the clock, starting unusually, Richard, with me.

All right, Richard, we need government to invest in public infrastructure that promotes activity that the private can take advantage of later. Now, I'm thinking about bridges that seem to go nowhere, but later create economic activity on either side.

Think about quality public education. For all its travails, it is a must for those who cannot afford private schools.

Law enforcement, national defense, they're obvious. Even libertarians don't argue with that.

But sometimes government is the only game in town for research into areas that the private sector won't enter first, space exploration, cures for viruses and diseases that wouldn't be commercially viable.

The U.S. government invented the Internet first. It established a space into which the private sector would later step.

Now, whatever your take on public health care, no one disputes a government's power to negotiate better rates as a buyer than any company could.

And industry has shown its inability to regulate itself when it comes to protecting the consumer and the environment.

So, government shouldn't have its hand in everything, but it's not all bad. Wouldn't you agree?

RICHARD QUEST, HOST, CNN INTERNATIONAL'S "QUEST MEANS BUSINESS": The question is what does government do best and when does it do it better than the private sector.

And, yes, Ali Velshi gave us his weekly laundry list of events and items, but what's behind it?

Behind it is questions of public policy. Government is best when it is working for all of us.

But here's the problem. Because we have to be careful if we let the private sector in too much that we don't end up with tyranny of the majority.

The minority have a right to be heard. The minority have a right to disagree. The minority have a right to have their view counted for.

And that's the difference between government doing something and private sector. What you want is the best of both worlds. Government sets the policy, private sector implements the practice. The problem is, it never really works.

VELSHI: Good point. The government doesn't run like a board of directors, Richard. It is a much more complicated matter than most people think.

You folks in Europe have had a chance to experiment with this over the last couple of years and it seems to me we're about to here in the U.S.

QUEST: I've got a real live example for you. The E.U. is currently putting -- or debating caps on bankers' bonuses.

Is that something the E.U. should be doing or is that something bank shareholders should be doing? Government or private sector?

VELSHI: I think we may have a topic for another time, Richard Quest, host of "Quest Means Business."

From the CNN studios in Washington, D.C., that's it for me. Join me for a live hour of "Your Money," tomorrow, 1:00 p.m. Eastern.

I'm going to introduce you to someone who says his company knows better than the U.S. government how to handle airport security.


BALDWIN: Will actress Ashley Judd take on one of the most powerful Republicans in Congress? Well, take a look.

These are live pictures. She's in Washington, D.C., as we speak, at an event at George Washington University. She is raising some eyebrows as to whether or not she will run against Senate minority leader Mitch McConnell.

Political reporter Shannon Travis joins me now with a little "Political Pop" on this Friday.

We've talked about Ashley Judd before, Shannon Travis, and we know she is certainly no stranger to politics. Do we expect a decision anytime soon?

SHANNON TRAVIS, CNN POLITICAL REPORTER: Yeah, I mean, we're hearing that she could make a decision by May. Obviously, she's an actress. This could be her biggest drama yet if she does decide to run against Mitch McConnell, obviously the most powerful Republican in the Senate, as you just mentioned.

We're looking at live pictures there of Ashley Judd at this forum on women's reproductive rights there at George Washington University.

She has another event here in Washington tomorrow where she'll be honored for her humanitarian work abroad.

All of this obviously, Brooke, raising a lot of eyebrows and gaining a lot of spotlight.

She's also been meeting with Democratic officials here in Washington, and potential donors in Kentucky. That's, again, raising a lot of people's eyebrows, especially Mitch McConnell, and Karl Rove's group.

Take a look at this ad from his group, "American Crossroads."


UNIDENTIFIED MALE: You know what this country really needs? An independent voice, for Obama.

ASHLEY JUDD, ACTRESS: I am committed to President Obama and Vice President Biden. I think he's a brilliant man. He is now able to flower more as the president I knew he could be.

UNIDENTIFIED MALE: A leader who knows how to follow.


TRAVIS: Now, Brooke, one of the issues that they hope to hammer away at Ashley Judd is this issue of her not actually living in Kentucky. She has deep ties in the state, but she actually lives in Tennessee. But Mitch McConnell needs to be careful himself. His popularity ratings aren't that high in Kentucky and he's kind of an established politician amid this anti-establishment move.


BALDWIN: Yeah, as you point out, he is quite the powerhouse, though ...

TRAVIS: That's right.

BALDWIN: ... a Republican in the Senate, so we shall see if she makes that decision, Ashley Judd.

Shannon Travis, thank you so much.

And, now, just into us here at CNN, parole has been denied for convicted murderer Bruce Davis. He was a follower of notorious killer, Charles Manson, and a member of the cult family -- the cult, I should say, known as "The Family."

Davis is serving two life sentences for the 1969 slayings of musician Gary Hinman and former stunt man, Donald Shea, other members who lived in Manson's California commune.

Now 70, Davis had applied for a release on good behavior, but a judge has just denied that application.

Coming up next, joining me live in studio, the Steep Canyon Rangers. Hit it, guys, winner of the Grammy, best bluegrass album.


BALDWIN: So, I have some new friends, here in the studio. This is such a rarity. Hello, happy Friday. This is so cool because I'm actually a true fan.

You're about to meet them, but first I want you to take a look at them in action, the Grammy -- does that sound good now -- the Grammy-award winning Steep Canyon Rangers.

So, you may be saying the guy kind of in the front-ish with the white hair, right, he kind of looks familiar, got a banjo, looks kind of like maybe Steve Martin, comedian, actor, writer, that guy, Steve Martin, jamming along on a song he actually penned himself for the Steep Canyon Rangers.

Guys, welcome, welcome, welcome. Just quickly, left to right, why don't you start? Give me your names.



NICKY SANDERS, STEEP CANYON RANGERS: Nicky Sanders and our bass player's Charles Humphrey. BALDWIN: And, so Woody, let's just begin with you here. How did Steve Martin even join you guys? He's a little older.

PLATT: Well, yeah. He was introduced to us. His wife actually introduced us. And we found out he had a connection to the banjo, and they were vacationing in western North Carolina and we got the phone call saying Steve Martin's in town with his banjo, why don't you guys come along and do some picking.

And from there it just kind of has led to a lot of shows, a lot of touring.

BALDWIN: Shows, touring and, just recently you all winning a Grammy.

Was that just a total goose bump moment for you? Yeah?


BALDWIN: I'm just curious. I love music. I loved just growing up in the South, as well, being in North Carolina a lot. I love bluegrass, but you see a lot more of this sort of instrumentation in other bands now.

Why do you think this has sort of become -- it always was cool, I'm sure if you ask you, but not always according to others.

What is it about this instrumentation you think has kind of made a comeback?

UNIDENTIFIED MALE: I think the instruments and these instrumentations kind of have a lot of meanings sort of built in with them that's maybe some of the negative parts of it have sort of faded away with time and now some of the more positive parts of it are sort of coming to the fore and bands can use that and it gives a real flavor to it.

BALDWIN: You all have made my Friday. There website is

I will see you playing tomorrow night with Steve and play me to break, will you?

UNIDENTIFIED MALE: All right. Let's do it.



BALDWIN: Thousands of gallons of whiskey flushed down the drain. Instead of waste water, workers flushed perfectly good whiskey down a sewage line.

The giant mistake happened on Tuesday at a Chivas Brothers plant in Scotland. According "The Scottish Sun," bosses are reportedly furious.

The whiskey plant is back up and running now. And hundreds of ice boulders are piled onto the shores of Lake Michigan. Look at this.

The natural ice boulders weigh up to 50 pounds each. They sort of look like giant frosty basketballs. Look at the sky there. The winter phenomena is at Sleeping Bear Dunes National Lakeshore.

And before we go here, just in to us at CNN, an autopsy shows that a Russian boy adopted by an American family died by accident.

Russian foreign officials accused the boy's parents of abusing Max, helping to lead to his death, but the district attorney in this Texas county where Max's family lives, they say the medical examiner found the boy had an internal laceration caused by some kind of blunt trauma to his stomach.

The ME found the bruising on the boy. It was self-inflicted.

And before I let you go here in the final seconds of the hour, the "Big Board," 14,079, still a bit away -- there it goes -- from that high back in October of 2007.

We're still waiting for that high to kick back in. That was 14,164.

And that does it for me. I'm Brooke Baldwin here at the CNN World Headquarters in Atlanta. Have a wonderful weekend.

Wolf Blitzer starts right now. Hey, Wolf.

WOLF BLITZER, CNN ANCHOR: Hey, Brooke, thanks very much.