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ANDERSON COOPER 360 DEGREES

The Making of a Terrorist; On the Ground in Yemen; Bike to Work; What's Next: Design

Aired January 6, 2010 - 23:00   ET

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


(COMMERCIAL BREAK)

ANDERSON COOPER, CNN ANCHOR: Tonight, the making of a terrorist. With charges leveled against the alleged Christmas bomber, we have new inside information, surprising stuff about how quickly top officials now believe he was turned into a violent extremist, al Qaeda's new methods of recruitment and who they're trying to reach.

Also tonight, if the government plans a surge of air marshals, we take a look at what is and isn't working at airport security. You probably have been patted down but it turns out that's not worth much of anything and those millions spent on fancy TSA machines, wasted. We're "Keeping them Honest".

First up tonight: terror charges in the Christmas bombing attempt. A federal grand jury in Detroit handing up the indictment against this man, Umar Farouk Abdulmutallab, a Nigerian, 23 years old, a rich man, well traveled. Allegedly radicalized at an al Qaeda training camp in Yemen, reportedly -- as you'll hear only on 360 -- with some shocking speed.

The indictment says he boarded Northwest Flight 253 on Christmas Day with a bomb made of two explosives sewn into his underpants.

Now, I want to show you the charges: attempted use of a weapon of mass destruction, that's the bomb; attempted murder within the special aircraft jurisdiction of the U.S. That's a legal term for any aircraft in American airspace or with an American destination.

Other charge: willful attempt to destroy and wreck an aircraft within that same legal jurisdiction; also, willfully placing a destructive device in, upon and in proximity to an aircraft; and two counts of possession of a firearm or destructive device in furtherance of a violent crime.

Now, all together, they add up to a potential life sentence. There's a lot of moving parts to this story in the criminal justice system, the counterterrorism community and at the White House. We're covering all of it tonight with senior political analyst, David Gergen; senior legal analyst, Jeffrey Toobin; and Frances Townsend, CNN national security contributor and former homeland security adviser to President Bush.

(BEGIN VIDEOTAPE)

COOPER: So Jeff, a six-count federal indictment. What's next?

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: He will be arraigned. He will not get out on bail. And the case will proceed, I assume, like Richard Reid, the shoe bomber. He's going to plead guilty.

COOPER: Why do you think he would plead guilty? Why wouldn't -- I mean, there are some who say he will try to make a mockery of the U.S. courts, that he will try drag this out as long as possible, so when -- then he'd plead not guilty, if that is what his intention is?

TOOBIN: That is a possibility, I suppose, but he has a responsible lawyer, the head public defender in that part of Michigan. I just think when the facts are as obvious as these facts are people tend not to go to trial and I don't know when he will plead guilty, but I think he will.

COOPER: Fran, the U.S. is already saying that they got information from this guy as soon as the FBI started interviewing him when they pulled him off the plane.

FRAN TOWNSEND, CNN NATIONAL SECURITY CONTRIBUTOR: Well, that's right, Anderson, but what we're hearing from FBI officials is that they spoke to him without giving him Miranda. As you would expect, they were interested in the disruption of any follow-on attacks.

They then gave him Miranda. And what I'm hearing from FBI sources is that he then clammed up and actually became somewhat belligerent.

And so I agree with Jeffrey, given the overwhelming nature of this evidence, if he maintains a belligerent attitude, he may just force the government to walk the paces through the case.

COOPER: David, what are you hearing? I know you had some inside information about al Qaeda and some of their recruiting tactics.

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: The -- I was told today, Anderson, by folks at the White House that they were -- they were quite surprised at the recruiting effort, how successful and how quick it was. This young man, just like Mr. Hasan, was drawn in by the Internet, which one person called today hauntingly persuasive for people like him.

But then he went to Yemen. He was only there for about four months. And in that time, essentially, he was swept-up and he was brainwashed in an almost cult-like environment and then they sent him forward on his mission and it happened very quickly. He was turned around and turned into this, in effect, a guided missile for the al Qaeda.

So, the White House is trying to figure out now how does this al Qaeda operation work? Is this similar to what's going on elsewhere? How sophisticated is it?

COOPER: That's pretty interesting, Fran. I mean, it also corresponds to his father coming forward and saying look, my son has gone off the deep end and raising all these red flags about his son. He told the CIA officials that in Nigeria, in the capital. It is surprising to hear how quickly though this young man was allegedly radicalized.

TOWNSEND: Anderson, that's right except --- you know, we have -- there has been other reports that this was a guy who was disaffected for some time, including back to the time when he was in Yemen -- I'm sorry, when he was being educated in London.

And we know that al-Awlaki, the same radical preacher that David just spoken about, having radicalized him in Yemen, also was preaching there at the same time. It will be interesting to see as this unfolds, whether or not al-Awlaki the radical preacher and Abdulmutallab had contact when he was in Yemen.

So it may be that this was a longer period of time during which he was susceptible to these radical ideas than we realize yet.

COOPER: Yes, he invited radical speakers when he was head of the Islamic society of his school in England. That's what Fran was referring to.

Jeff, you know, there's been a lot of criticism from mainly Republicans saying, look this should have been tried, not put into a civilian court. The military should have handled this. This guy should not have been mirandized (ph) and read his rights and given the rights of an American citizen.

Would the process be very --- I mean, what would the process be if that had occurred, if he's then sort of taken by the military?

TOOBIN: Well, since there hasn't been a successful military tribunal for terrorism since World War II we don't know...

COOPER: Not a single one?

TOOBIN: Not one that has resulted in a conviction like this, absolutely -- in a case anything like this, not at all. So, I mean, I think when you talk about choosing between the two, you have to remember that we have a very tried, very effective federal criminal justice system and nothing comparable in the military system that's been proven to work and upheld by the courts.

But even if you had a military tribunal system, you couldn't get more information out of him because he's not talking and presumably, we're done with water boarding in this country. And having said he didn't want to talk, that would be respected. End of story.

So, in fact, in terms of what we really care about, getting more information, you wouldn't get information either way.

COOPER: David, we talked about accountability last night. Did -- whoever you talked to in the White House today talk about, you know, anyone actually being held responsible, being fired for -- for failing to connect the dots? GERGEN: Well, I think a number of people in Washington have been speculating that Mr. Leiter, who runs the National Counterterrorism Center, might well lose his job over this. I was told today that he was safe. That suggests that there may not be a lot of firings on this whole thing. I didn't have the sense in talking to people today that that was coming.

Instead, what I -- I also asked about a question Paul Begala raised on this program last night with you, Anderson. That is, was the president going to take any responsibility here? After all, he didn't insert himself into that list yesterday about taking personal responsibility. And I was told that he did in a meeting yesterday say the buck stops here, in effect, I take responsibility and that he would publicly take responsibility.

So, this Brennan report that's coming out tomorrow may be accompanied by a statement by the president saying, ultimately, at the end of the day, "I'm the responsible officer here."

TOWNSEND: Anderson, that is precisely what I heard on my way over here from a senior administration official. The report that you we're going to see from Brennan tomorrow is going to be very short, two or three pages and no one's getting fired. That was the most recent information I get...

COOPER: No one is getting fired? No one is resigning?

TOWNSEND: Right.

COOPER: Interesting.

Fran Townsend, I appreciate it. David Gergen, and Jeff Toobin as well. Thanks.

GERGEN: Thank you.

(END VIDEOTAPE)

COOPER: No one, it seems, is being held accountable. Do you think putting this guy on trial is the right move? Let us know. Join the live chat now under way at AC360.com. I just logged on myself.

Up next, a new airline scare, fighter jets were scrambled, the entire security system apparently stretched tight. We have details on that.

And tonight we're investigating the TSA. Now, when you walk through the TSA screening, does it actually work? You've probably been patted down, those fancy machines. Well, you're going to be disturbed by what our investigation found. We're "Keeping them Honest".

And tonight, President Obama making a campaign promise to negotiate health care reform out in the open, even on C-Span. Do you remember that promise? Well, now the CEO of C-Span is calling him on it, but is the president not living up to his promise? We have the "Raw Politics" and the plain facts.

(COMMERCIAL BREAK)

COOPER: We had another sign tonight of how edgy it is for people who fly. A Hawaiian Airline 767 returning to Portland, Oregon -- that's it right there -- after a passenger got unruly and according to TSA made threatening remarks and refused to stow his carry-on bag. Two F-15 fighters were scrambled. Authorities interviewed the passenger and companion, released them and turned the case over to U.S. attorneys.

Now, it wasn't the first scare this week, the entire system remains on high alert.

Tonight, we are learning that the government is pushing to get more air marshals on airliners. In particular, immigration agents are being asked to volunteer because they've already got some of the needed training.

Things are changing. The real question though and it's being asked from the White House on down is this, what works in airports? What doesn't work, in terms of screening? Who is doing a good job and who isn't?

Randi Kaye has been investigating the system. Tonight, she is "Keeping them Honest".

(BEGIN VIDEOTAPE)

RANDI KAYE, CNN CORRESPONDENT (voice-over): On Sunday at Terminal C in Newark Airport, a man slips past a security check point. A TSA worker is distracted and doesn't notice. Even when a passenger alerts officials, the TSA waits more than an hour before alerting airport police to the security breach. If this was a real threat, that's precious time.

And when the TSA tries to view security tape of the incident, it discovers the cameras are running but not recording. And we've learned that's not unusual. The union representing airport police tells us the TSA routinely informs them of illegal activity long after the fact.

The TSA says, it accepts full responsibility for the failure and has placed the employee involved on administrative leave. The unidentified man, no trace.

"Keeping them Honest," what's going on at the TSA and who is in charge?

(on camera): The man nominated as its head has admitted improperly accessing a government database 20 years ago to run a background check on his ex-wife's new boyfriend. The nomination has also been held up because of Republican's concern he would allow TSA workers to join a labor union. And there are other problems. The TSA spent $30 million on its fancy puffer machines, which blow air on you to release explosive material. They didn't work and are being phased out. One security expert says TSA pat-down practices miss all sorts of things.

BRUCE SCHNEIER, SECURITY TECHNOLOGIST: Any pat-down that you experience that doesn't embarrass you physically is one that's not very effective.

KAYE: Even the agency's animals seem out of sorts. In Philadelphia, three of the TSA's bomb-sniffing dogs failed consecutive tests. The dogs were responsible for checking cargo at Philadelphia International. Ten other airport dogs did pass the tests.

REP. ROBERT BRADY (D), PENNSYLVANIA: They don't retrain them. They've got to retrain then and recertify. It's not the dog's fault. The dog can't say I can't smell a bomb.

KAYE: TSA's response? There are more than 700 dog teams at airports and mass transit hubs and all are supposed to be recertified occasionally.

Back in December, when the TSA inadvertently posted its screening procedures manual online, a leak that might aid terrorists, five employees were put on leave.

Just yesterday in Bakersfield, California, the airport was evacuated, shut down for five hours, after two TSA workers found what they thought were traces of explosives on a bag and bottles. They complain they felt sick after smelling fumes from the bottles. Turns out, the bottles contained honey. Officials are still puzzled.

On its Web site, the TSA says its vision is to, quote, "continuously set the standard for excellence in transportation security". A vision that to some, seems blinded by mishaps and confusion.

(END VIDEOTAPE)

COOPER: And, I mean, let's be clear, a lot of TSA personnel are working hard to try to keep us all safe, but this is -- there are mistakes happening all across the world in security.

KAYE: Right. And certainly isn't just the TSA. We have one crazy story to share with you out of Slovakia. The airport police there, they tried to test their security system. But things didn't go so well. They put explosives in a passenger's backpack but bomb- sniffing dogs only found one.

The airport police were distracted and apparently, well, they just forgot about the other one and the passenger ended up flying to Dublin with it. It wasn't connected to a detonator. So it wasn't dangerous. But this poor guy's house Anderson, was raided, he was arrested briefly...

COOPER: Yes. KAYE: ... when he landed in Dublin, because they forgot they've left an explosive in his backpack.

COOPER: All right, Randi tonight is "Keeping them Honest" thanks very much.

Up next, will President Obama back away from a campaign promise to put the final bargaining over health care reform in front of the cameras on C-Span? We have the "Raw Politics".

(COMMERCIAL BREAK)

COOPER: In "Raw Politics" tonight, health care and transparency. From the get-go, President Obama promised the health care debate would take place in the open, including the negotiations that are central to writing a bill. He even spelled out how the transparency would happen, not once but at least five times and -- feel free to count along with me.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: It will be televised on C-Span. I can guarantee you it will be exciting.

Broadcasting those negotiations on C-Span so that the American people can see what the choices are.

And we're going to do it all on C-Span. It is all going to be televised.

All this will be done on C-Span, in front of the public.

We'll have the negotiations televised on C-Span.

(END VIDEO CLIP)

COOPER: Well, that's just five times. As promises go, it's pretty explicit.

So why then, as Democrats prepare for the last key phase of health care negotiations where they merge the House and the Senate bills are Democrats ignoring C-Span's actual requests to cover the negotiations live?

C-Span sent a letter to the Democratic leaders last week, as of tonight, no response yet from lawmakers or from President Obama.

Joe Johns joins me with the "Raw Politics."

So Joe, I mean it does seem odd, the president talked a lot about transparency, clearly said he wanted to see this on C-Span.

JOE JOHNS, CNN CORRESPONDENT: Well, it's simple -- this has obviously been very hard so far and it'll be a lot easier than having a big televised event. White House is just sort of making the case that this issue has already been vetted, vetted for two years. They also realize that if they did have televised hearings, it would just give the opposition another platform -- Anderson.

COOPER: But again, it's just a case of you say one thing when you're running for office -- and this happens on both sides of the political aisle -- and then, something else very different when you're actually leader.

From the Republican perspective, there were some backroom deals. Republicans say the Democrats were essentially buying votes.

You look at Senator Ben Nelson, who's State of Nebraska ended up with a deal where they -- they don't have to pick up the tab for expanding Medicaid.

Bernie Sanders of Vermont, a supporter of the public option, ends up with a $10 billion grant for community health centers.

So, do Republicans have a point here?

JOHNS: Well, yes, it's also a question of political realities. It's pretty clear the bill is not going to get significant Republican support. And what the Republicans are pretty much going to miss out on now is the opportunity to score some points and grandstand for the base. And there's still also ---getting to the point where they can claim the president is breaking that campaign promise.

But to be fair, the president made that promise before the Republicans said they would filibuster the health care bill. So, either way, this gives an opportunity for them to accuse those Democrats one more time of the secret deal making you were talking about on health care. A win-win for them pretty much.

COOPER: Yes. Nancy Pelosi was asked about this by a reporter, about not having these negotiations on C-Span. And here's what she said.

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D), HOUSE SPEAKER: Well -- there are a number of things he swore on the campaign trail.

(END VIDEO CLIP)

COOPER: Yes. I mean, ouch. Why would the Speaker sort of whack the president like that?

JOHNS: Well, definitely, it sounded like the Speaker was having a little fun at the president's expense. And you know, in a way, she is right. When you make promises about transparency, like Mr. Obama did on the campaign trail, you got to expect that they could come back and bite you.

The administration has admitted, sure there have been miscalculations all the way through this health care debate, starting with their failure to sort of figure out how militant the opposition would be. A Democratic analyst told me the White House never really expected to get the kind of public pushback that they have gotten so far.

COOPER: So, does the president have lasting damage for being, you know, for transparency, before he was against it?

JOHNS: Well, sort of short-term and long-term. Short-term, probably not. Fights over Congressional procedure generally go absolutely nowhere. And the president and his party are likely going to get what they want when they pass their bill.

Long-term damage though could be a different story. Clearly, it looks -- it appears like the president has gone back on his word. So, if this is about political capital, he spent a lot on this one. The question really is whether he spent more than he's got.

COOPER: All right, Joe Johns, I appreciate it. Thanks very much.

Let's turn again to CNN senior political analyst David Gergen for tonight's "Insider Briefing".

David, I should point out, worked for the Clinton administration during its struggle to pass health care reform in the '90s. He's also worked for Republican administrations in the White House. I talked to him earlier.

(BEGIN VIDEOTAPE)

COOPER: David, you went through this with the White House, with the Clinton White House, they were also accused of being --- of not being transparent, of being overly partisan. I mean, what do you think the fallout is going to be for the Obama administration and the Democrats in general this time around?

GERGEN: Well, so far, Anderson, they have had a remarkable lack of success in bringing the public along on this health care bill. And it seems to me that's their biggest problem right now. They've got the Democrats pretty much. I think they're going to be able to resolve a lot of these differences behind closed doors.

This whole effort to say put it on C-Span, I sort of don't think it's going to go ---make that much difference to the public. What the public is really concerned about is, is this plan going to work? How much money is it going to cost me? How much -- is the government really going to be able to run this right? Am I going to lose my health care?

The more substantive issues and on those issues right now, there has been no movement in the polls that I've seen in the president's direction, which means we could have for the first time in our lifetime major social legislation passed in the teeth of public opposition.

COOPER: What did they do wrong? I mean, they supposedly had learned the mistakes that had been made under the Clinton administration in trying to do health care. You have President Obama elected saying, you know, a lot of people saying they want health care reform. They now are on the brink of having some kind of health care reform. And yet, as you say, this is in the face of public opposition.

GERGEN: Anderson, I think that they may have over learned the lessons of the Clinton administration then, by essentially assigning almost all the responsibility for writing the bill, the health care bill, to Congress. It, inevitably, got drawn into the vortex of what's -- in especially in the House, is a lot of partisanship.

And very importantly, the summer was a turning point for this, when those TEA parties got started up and the people started throwing bricks at the health care plan, the White House wasn't quite prepared for that and they had -- the month of August was a lost month for them. And by the time the president came back, went to the Congress to give that speech, he was able to, I think, staunch the flow of bleeding. But he wasn't able to turn opinion around in his favor.

And I think the White House itself now realizes that one of the things they've got to get straightened out here in the future is they can be really, really good when they are all together in the White House but when they scatter for holidays, as they did in August and as they did again with the -- with the December bombing by the bomber in Detroit, they tend to be a little slower off the mark. And they can lose some of the momentum.

COOPER: Maybe no holidays next year.

GERGEN: No.

COOPER: We'll see. David, thanks, David Gergen.

GERGEN: Thank you.

(END VIDEO CLIP)

COOPER: Well, still ahead tonight, a "360 Dispatch" from what appears to be the new front in the war on terror. We'll take you inside Yemen for a firsthand look at where and why al Qaeda is thriving -- real reporting you'll see only on CNN.

And a daring escape caught on camera. An inmate breaks free from a chain, runs off. How it ended, coming up.

(COMMERCIAL BREAK)

COOPER: Erica Hill has a "360 Bulletin" --- Erica.

ERICA HILL, CNN CORRESPONDENT: Anderson, the 89-year-old white supremacist charged with killing a security guard at the Holocaust Museum in Washington, D.C., died this afternoon at the federal prison in North Carolina where he was awaiting trial. A prison official says James Von Brunn suffered from chronic congestive heart failure as well as other problems. He was 88.

At least six deaths are now blamed on that arctic chill that began across much of the country this weekend and even lower temperatures are on the way. CNN meteorologist Rob Marciano says the Souths will get -- the South that is, will get a second blast of arctic air later this week. And those temperatures will be about five degrees colder, just what you want to hear.

Snow, meantime, is the problem in the Midwest where a blizzard warning is in effect for parts of South Dakota. There, you see the wind there. Up to nine inches of snow is expected in the Chicago area.

One of the most powerful Democrats in the senate is retiring. Connecticut Senator Christopher Dodd, who ran for the Democratic presidential nomination in 2008, announcing today he will not seek re- election to a sixth term.

This comes just one day after Democratic Senator Byron Dorgan of North Dakota, who has served in Congress for nearly 30 years, announced he won't run again either and also not seeking another term, a man who is considered a rising star in the Democratic Party, Colorado Governor Bill Ritter. His reason, something we have heard before from politicians and something Senator Dodd apparently doesn't agree with.

(BEGIN VIDEO CLIP)

GOV. BILL RITTER (D), COLORADO: I'm no longer going to be a candidate for re-election in 2010. It allows me to concentrate on the things that are and should be most important to all of us, taking care of my family.

SEN. CHRIS DODD (D), CONNECTICUT: Now, there's nothing more pathetic, in my view, than a politician who announces they are only leaving public life to spend more time with their family.

(END VIDEO CLIP)

HILL: Now, we should mention, six Republican senators have also announced they are retiring.

And here in New York City, check out this daring escape on Staten Island. That was actually caught on camera by our affiliate, WABC. An inmate -- there you see -- breaks free from a chain linking prisoners being led out of the police precinct. Makes a run for a ferry terminal, they caught him though on a train a few minutes later and apparently held him, I think, in the conductor's car until the cops can get him.

COOPER: Wow. There you go. As always you can join the live chat happening now AC360.com.

Coming up: a "360 Dispatch" on the ground in Yemen where not many outsiders visit. Our Paula Newton just got into the country and shows us why it has become a new staging ground for al Qaeda.

Plus, we're looking in the future again tonight in our "What's Next" series. We're going to talk with designer Isaac Mizrahi about what is coming next in fashion and design and find out what three things he cannot live without. Stay tuned.

(COMMERCIAL BREAK)

COOPER: In Yemen, officials reported the arrests of three more al Qaeda suspects today, and I want to show where you this occurred. The operation unfolded in Amran province, which is northwest of the capital, Sanaa. It's the latest in a series of raids since the accused Christmas day bomber was tied to Yemeni extremists.

As we talked about earlier, the time that this guy, this Nigerian, Umar Farouk Abdulmutallab spent in Yemen was critical to his radicalization. It's become a hotbed of extremism.

I want to try to come over here to the map and show you some of the key points as to why that is map. This is where Yemen is, right here, right below Saudi Arabia. What you may not realize is Yemen is the ancestral home of Osama bin Laden. His family comes from a region called Hadramut. It's a province right there. He still has a large extended family who live in that area.

Yemen is also where, I should point out, we have been attacked before. Back in 2000, al Qaeda bombed the USS Cole, which was right here in Aden Harbor. Since that bombing, Yemen's largely unsecured border with Saudi Arabia has made it an easy place to enter. And because there are large, unpopulated swaths of desert it's a relatively easy place for al Qaeda to set up training camp.

You can check out this border right here, very long border here with Saudi Arabia.

Now, Yemen is considered a police state and the government says it's committed to fighting extremists but that is easier said than done. It is an unforgiving place, not many outsiders visit.

But our Paula Newton just got into the country. Here is what she found in tonight's "360 Dispatch".

(BEGIN VIDEOTAPE)

PAULA NEWTON, CNN INTERNATIONAL SECURITY CORRESPONDENT (voice- over): Flying into Yemen, it is hard to shake the instant comparison; the jagged mountains, the unforgiving terrain, reminds you so much of Afghanistan.

And on the ground, it's easy to figure out why al Qaeda is staging a comeback here. This is a deeply conservative, religious country where poverty is found in every corner and crevice.

Umar Farouk Abdulmutallab singled out this language school in the capital, ostensibly to improve his Arabic and refine his knowledge of Islam just months before he boarded flight 253 to Detroit.

(on camera): So, we are here at the language institute where Abdulmutallab came, and authorities believe that this was a cover for him. We're going to go in right now and see if we can find anybody who knows him. (voice-over): The institute's director tells us he was shocked by the Christmas day bombing attempt. Abdulmutallab, he says, was quiet and devout.

UNIDENTIFIED MALE: I get like afraid or scared when I realize that al Qaeda member was here in our school or lived in our hostel.

NEWTON: Because you wonder what could have happened?

UNIDENTIFIED MALE: Of course. He could have exploded the institute.

NEWTON (voice-over): And now, take a look at Abdulmutallab's view of the old city of Sanaa, the capital of Yemen, a place where Yemeni authorities now believe he nursed his extremism and may have found a way to express it.

(on camera): The institute is now convinced that Abdulmutallab was using their language school as a cover and that he knew what he wanted when he came to Yemen.

He wanted to mix and mingle in this chaotic environment. We are here outside the old city gates of Sanaa, the capital. And remember that here, the 9/11 attacks were celebrated as a victory for jihad.

Some people allege that Abdulmutallab knew that if he wanted to perpetrate some kind of an attack, he could find the means to do it right here in Yemen.

(voice-over): American Linda Shen has been living in Yemen for four years as an Arabic student and web designer. She says she is not surprised Abdulmutallab would choose this country. He wanted material support for a terror attack.

LINDA SHEN, ARABIC STUDENT: Yes, I have met people, and I would not be surprised that he would do something like. I just was surprised that he -- such a quiet guy, would be him.

NEWTON: In terms of trying to get something like an explosive though, that's even...

SHEN: It's not difficult. I mean, if I wanted to, I can get hold of explosives, if I wanted to. In Yemen, easy.

NEWTON: And all these things, do they make it a prime choice for al Qaeda to try and settle in here?

SHEN: Absolutely. Absolutely. The chaos. You know, the -- you know, the lack of government control. Absolutely. I mean, you've seen the terrain in Yemen. Oh, it's a haven. If you are hiding in some mountains, with the tribal control, nobody can get in there.

NEWTON (voice-over): And yet, only now, it seems Yemeni special forces speeding through the country on a hair trigger, on the hunt for al Qaeda operatives.

(END VIDEOTAPE)

COOPER: Paula, a lot of people here calling Yemen the new front in the war on terror, but leaders there say they have been warning about this for years?

NEWTON: Absolutely, Anderson. You know, the Yemeni officials tell me, look, we have told three American administrations that al Qaeda is a problem here and that they need to be able to help with us some intelligence from the military and aid support, quite frankly, Anderson.

What's interesting here though is that the Yemeni government can't be seen to be a puppet of the United States. You know, Anderson, we're going right back down that road again, we're going down in Pakistan. You can help, you can aid, you can get that intelligence in, but you can only go so far and that is because of the anti-Americanism that still remains quite deep here.

And you know, Anderson, think about this. We just had a report that said that intelligence in Afghanistan really has not been very effective for almost a decade. Yemeni officials telling me still, when we ask Americans what do you know about Yemen, Anderson what do you think the biggest reference is? That Chandler from the episode of "Friends" decided he was going to escape from Yemen in one episode.

On one side, they are laughing, but the other, how are we going to expect some good support from our Western allies and how far behind the 8 ball are we right now with these al Qaeda cells? Really, there could be more al Qaeda operatives in this country right now, Anderson, than there are in Afghanistan.

COOPER: Paula Newton, stay safe there. Paula, thanks.

Up next, get in shape, help the environment and get paid for doing it. It is one simple thing you can do every day. So why don't more people do it? When "360" continues.

(COMMERCIAL BREAK)

COOPER: It's a simple thing you can do to help the environment, riding your bike to work instead of driving. It can dramatically reduce your carbon footprint, but few people in America actually do it. Bike advocacy groups across the country are working to change this by making biking to work safer and easier.

Brooke Baldwin took a ride with one of these advocates on the streets of Atlanta for tonight's "One Simple Thing" report.

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: Hey, Alex.

ALEX OLEWICZ, BICYCLE COMMUTER: How are you doing?

BROOKE BALDWIN, CNN CORRESPONDENT (voice-over): Alex olewicz, may look like just another guy at the office. OLEWICZ: How are we doing with fast track?

BALDWIN: Except this hospital efficiency expert does something that most Americans do not. Five days a week, Alex bikes to work.

(on camera): How long are we biking today, Alex?

OLEWICZ: About ten and a half to 11 miles.

BALDWIN: I should ask how long are you biking today? A bike path.

(voice-over): On a frigid January morning, Alex invited me along for part of his morning commute.

(on camera): So, is this the steepest hill we are going to deal with?

OLEWICZ: No.

BALDWIN: No?

OLEWICZ: This is like -- this is the warm-up.

BALDWIN (voice-over): Physical fitness is one of the reasons Alex swears by his bike. Two others: helping the environment and cutting commuter costs.

(on camera): How much do you think you save every month by biking? Have you ever done the math?

OLEWICZ: I think I did it a couple years ago. It's $200 at least a month.

BALDWIN (voice-over): not to mention Alex gets paid to bike.

Tucked away in the 2008 Emergency Economic Stabilization Act, otherwise known as the bank bailout, is section 211.

It allows employers nationwide to give $20 a month, tax-free, to employees who commute by bike.

So, what's the incentive for employers? It's the clean air campaign's mission to answer that very question.

Brian Carr says it's an opportunity for companies to allow their employees to help the environment.

BRIAN CARR, CLEAN AIR CAMPAIGN: More employers are being motivated to think green, act green, integrate into their decision- making more sustainability.

BALDWIN: Carr says every mile you don't drive keeps a pound of pollution out of the air. Did we mention, this is Atlanta, known for its pollution, sprawl and gridlock. REBECCA SERNA, EXECUTIVE DIRECTOR, ATLANTA BIKE COALITION: The red lines are the bike lanes we have today on the ground in Atlanta. As you can see there are not very many of them.

BALDWIN (on camera): Not very many.

(voice-over): As executive director of the Atlanta Bike Coalition, Rebecca Serna is trying to change that. Atlanta is no longer considered one of the worst cities for cycling but it's not the best either.

SERNA: Is all about money. But fortunately, one thing we have on our side is that bike lanes are the cheapest transportation facility that you can build.

We see this as being a really inexpensive and cost-effective alternative to, for example, (INAUDIBLE).

BALDWIN: More bike lanes and warmer weather would be nice for Alex Olewicz and his 22-mile round-trip commute. After a quick shower, Olewicz blends back in at the office, all the while leaving behind a much smaller carbon footprint.

Brook Baldwin, CNN, Atlanta.

(END VIDEOTAPE)

COOPER: Ahead, our series, "What's Next?" Isaac Mizrahi telling us what's next in fashion and design; he also discusses his new ventures and the three things he can't live without.

And Richard Heene speaking out for the first time since his guilty plea; he denies that the balloon drama was a hoax. You have to hear the interview to believe it.

(COMMERCIAL BREAK)

COOPER: Tonight, we continue our series, "What's Next," where we talk to leaders from a wide range of fields about the new developments they see ahead in the coming decade.

Last night we talked to inventor and innovator Dean Kamen about health care, technology and science. Tonight, we shift focus and turn to fashion and design.

An obvious choice for an interview: designer Isaac Mizrahi whose output is vast and varied. He's designed everything from clothing for Target to a cheesecake. We talked earlier.

(BEGIN VIDEOTAPE)

COOPER: It's interesting how the human eye changes. I mean, you look back at TV shows from -- I recently saw an old episode of "L.A. Law" which I guess is from the early '80s.

ISAAC MIZRAHI, FASHION DESIGNER: Yes. COOPER: And at the time, I remember thinking...

MIZRAHI: Don't pretend you weren't born. You were around.

COOPER: No, no. I can't remember the exact year. You look at it now, and it seems incredibly dated. I mean, it's the shoulder pads, and it looks absurd. And yet, I mean, we're wearing things now which 20 years from now, we're going to -- I'm going to look back on this suit and think, "I can't believe how I could have worn that."

I don't understand how the eye changes.

MIZRAHI: Well, I don't either, except I bore very easily. So when I see something that looks newish or that looks amusing, as opposed to dull, you know, I want to kill myself for being so bored, I go with it, you know?

And watching young people or watching, like, interesting, crazy people is a good way to see what's coming, do you know?

COOPER: Do you think -- you think about the future a lot?

MIZRAHI: I do. Yes, I do, and sometimes, the less I understand something, the more I like it. I -- I was involved recently at the 92nd Street Y, which is a venue in New York where people speak. And I spoke with Ashley Olsen. Do you know who she is? She's a young lady.

COOPER: One of the Olsens.

MIZRAHI: Yes, she's one of the Olsens.

COOPER: Of course. I'm obsessed with the Olsens.

MIZRAHI: Me, too. I'm obsessed with them. And there she was. And she literally was wearing, like, a hospital gown and tights and like...

COOPER: She was not wearing a hospital gown.

MIZRAHI: She was wearing stilts and like a tiara and a hospital gown. I thought this is the chicest thing. I don't understand it, but I'm obsessed with it from now on.

COOPER: Does fashion make sense to you? Does it -- people look at what's on the runways, and we all say that stuff looks ridiculous. No one could actually wear that.

MIZRAHI: I don't know. It depends on the house you go to. If you went to -- to, I guess, to Chanel, I think everything on the runway is expected to be worn by somebody. You know?

If you go to Dior, I don't think anyone expects anyone to wear that stuff. And it's great, and it's quite influential.

I'll tell you, as a designer, I never look at it. I get, like upset if I look at it, you know? At others, what others do. I get upset with it. And I work with stylists, luckily, who say, you can't do that because someone did that already. You know what I mean? Or, sometimes a bad stylist, oh, you should do that, because someone did it already.

COOPER: Well, I remember the movie "Unzipped," which is a great documentary, 1996, about you -- sort of the development of one line, one season.

MIZRAHI: Right.

COOPER: There was something. I can't remember what it was.

MIZRAHI: Nanook of the North.

COOPER: Nanook of the North was the look that you had watched a movie. And that was sort of the inspiration, but somebody else at the same time, unbeknownst to you, also kind of did a Nanook of the North.

MIZRAHI: Jean Paul Gautier.

COOPER: Right.

So in terms of business, you have your own line?

MIZRAHI: Yes.

COOPER: You have a Liz Claiborne line. You have a store that's opened up.

MIZRAHI: That's right it's so great.

COOPER: You have QVC which you've been on for a long time.

MIZRAHI: Yes.

COOPER: You have the Target line.

MIZRAHI: Yes.

COOPER: I mean, you have -- you're in -- your fingers are in a lot of different pies.

MIZRAHI: I also hopefully, you know, I'm involved in television, as well.

COOPER: Right.

MIZRAHI: I have this new talk show. And for me, as I said before, I bore so easily, right? And I never claim to be a master. I'm not Henry James or something, you know what I mean?

You, I'm not you. I think you're a master of something, you know what I mean? And I'm not. I just like to be diverted. I have a need to be diverted a lot. And I get crazy ideas.

You know, I had this idea. They said, "Oh, you should design product for the launch of QVC." So I did plaid things: plates and, you know, throws and cheesecake, a plaid cheesecake that went on a plaid platter.

COOPER: Plaid cheesecake?

MIZRAHI: Yes. And it's beautiful. And I'm telling you it's delicious.

COOPER: I'm told we actually have some of your cheesecake.

MIZRAHI: We do?

COOPER: I believe so.

MIZRAHI: Who says? Wait, look, there it is. It -- has it come down to room temperature?

COOPER: Wow, really is plaid.

MIZRAHI: Yes. And it's beautifully wrought, is it not?

COOPER: It's beautiful.

MIZRAHI: It's a beautifully done thing.

COOPER: How is that...

MIZRAHI: Well, it's like -- I'll tell you what it is.

COOPER: Is that plaid edible?

MIZRAHI: Yes, of course. No, I think you can get killed if you eat it. Are you crazy? Of course it's edible. That's the idea.

COOPER: I'll just cut us a piece while we continue.

MIZRAHI: Well, you go on, you can eat, because I think you need to bulk up, Anderson.

COOPER: Cheesecake...

MIZRAHI: Where I am going to be a supermodel by spring.

COOPER: Are these your drawings?

MIZRAHI: Yes, they are. These are my drawings of my dog.

COOPER: That's great.

MIZRAHI: Is this crazy? I know. Thank you. I draw my dog obsessively.

COOPER: We ask everybody who we're talking to for this "What's Next" series what three items can you not live without?

MIZRAHI: Oh, my God. Three items. All right. Well, one, I know, is my -- is my bridge program on my computer.

COOPER: Bridge? Really?

MIZRAHI: Yes. Because that's what I do when I get really bored; I play computer bridge. That's one thing.

The other thing is, let's see -- oh, I have a beautiful scarf that's this perfect weight. It's not too heavy. Sometimes a cashmere scarf can be too heavy. And it's not too light. And it travels well. I refer to it as blankie. I take it with me when I travel.

And what else can't I live without? My new orthotics. I got new orthotics for my shoes.

COOPER: Suddenly, I feel like we're in Miami Beach and we're 75 years old.

MIZRAHI: I know. I know.

COOPER: I have a nice scarf and orthotics. Have some more cheesecake.

MIZRAHI: Have some more plaid cheesecake. Sorry, what else?

COOPER: Thanks so much.

MIZRAHI: Thank you. It's a pleasure.

(END VIDEOTAPE)

COOPER: In terms of what's next in retail, Mizrahi said to expect online shopping to grab even more of the market. Actual stores with salespeople won't disappear, but he says that retailers that are best at serving customers online are going to have the greatest success.

Tomorrow, we continue our series "What's Next" with a look at education. I'm going to talk to Michelle Ree, chancellor of Washington, D.C. schools. She was tasked with transforming the troubled system more than two years ago. Her tough tactics have earned her a lot of praise, some criticism, as well. We've collected questions from kids around the country for Ree. That's tomorrow on "What's Next" on 360.

Let's get caught up on some of the other stories right now with Erica Hill and a "360 Bulletin" -- Erica.

HILL: Anderson late word into CNN tonight, Hanes is ending its ad campaign with actor Charlie Sheen. In a statement from the company, which reads in part, "The commercials were suspended, effective December 28, the first date possible after Mr. Sheen's Christmas Day arrest." The spokesman went on to say that, given the charges, domestic violence, the decision was, quote, "a pretty standard, straightforward call". A lawyer for Roman Polanski today asking a Los Angeles judge to sentence the director while he remains under house arrest in Switzerland. A hearing will be held later this month. Polanski, of course, fled the U.S. nearly 32 years ago before being sentenced for having sex with a 13-year-old girl.

A "360 Follow" tonight: NBA commissioner David Stern indefinitely suspending Washington Wizards guard Gilbert Arenas without pay. The move comes today after Arenas pointed his index fingers as if they were guns at his teammates, days after he violated NBA rules by bringing actual guns into the Wizards' locker room, triggering a criminal investigation. In a statement today, Arenas said he was sorry and understands why the league took action.

And Richard Heene, talking again to Larry King, just days before heading to jail after his recent guilty plea in the case; Heene insists the stunt that captivated the nation was not a hoax. Here's what he told Larry.

(BEGIN VIDEO CLIP)

RICHARD HEENE, PLEADED GUILTY IN BALLOON BOY HOAX: We had searched the house, high and low and -- I'm sorry.

LARRY KING, HOST, "LARRY KING LIVE": It's OK.

HEENE: And after I saw him in the craft and Bradford told me that he went inside, at first I didn't believe Bradford. And I told him that perhaps he's around. I just saw him. And...

KING: And so in substance, you believe your son was in the craft?

HEENE: I knew he was in the craft.

KING: You didn't know it.

HEENE: No, no, no, in my mind. In my mind.

KING: Oh.

HEENE: There was no other place because I visualized him. I yelled at him to not go in.

(END VIDEO CLIP)

COOPER: Come on. What?

HILL: Are you not...

COOPER: Are you kidding me with those...

HILL: Are you saying you don't believe him?

COOPER: Come on.

HILL: You didn't think he was genuine?

COOPER: Fake tears, really?

HILL: Look how upset he was, Anderson.

COOPER: And that is literally the way he fake-cried during that stupid interview.

HILL: Didn't he and his wife meet in an acting class, do I remember that correctly?

COOPER: All right. Continue.

HILL: Heene says he pleaded guilty to save his wife, Mayumi, from being deported to Japan.

COOPER: Poor Mayumi.

HILL: You can see the entire interview Friday night here on CNN. And I personally thought it was interesting he chose to spoke to Larry King and not Wolf Blitzer, who was of course, in for Larry on the night of that -- well, on that infamous night a couple of nights ago, the same night that little Falcon himself uttered one of your favorite lines of 2009.

Here's the gem.

(BEGIN VIDEO CLIP)

R. HEENE: Say hi to Wolf.

UNIDENTIFIED MALE: Hi.

WOLF BLITZER, CNN ANCHOR: Hi, guys.

FALCON HEENE, BALLOON BOY: Who the hell is Wolf?

(END VIDEO CLIP)

COOPER: The only true words that little boy spoke during that interview.

Erica, time for tonight's "Shot": remember when you were a kid and there were certain things you weren't allowed to do like jump on your bed and do back flips? Well, there's a reason for that, and we found a teenaged girl who learned that lesson the hard way. It's tonight's "Shot". Check it out. It's from Metacafe.com.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Oh.

(END VIDEO CLIP)

HILL: Whoa.

COOPER: I actually hadn't seen that video. That hurts.

HILL: And that's why the doctor said no more monkeys jumping on the bed.

COOPER: Yes. Wow. I hadn't seen that video. It's quite...

HILL: Want to see it again?

COOPER: Well, just the falling part. Yes. I don't want to see the -- I don't need to see the successful one again. I guess we have got it cued up. All right. Do we?

HILL: An impressive back flip until, you know it backfires.

COOPER: I'm not sure I can watch this.

HILL: Oh, you can. Ooh.

COOPER: Terrible.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Are you OK?

(END VIDEO CLIP)

COOPER: It's terrible and yet I laugh. I don't know why.

HILL: She gets up. That's the important thing.

COOPER: She's not going to try that again any time soon, I'm sure. And don't try that at home.

Hey that's it for 360. Thanks for watching.

"LARRY KING" starts right now.