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Market Meltdown; Famine Grips Somalia

Aired August 8, 2011 - 20:00   ET


ANDERSON COOPER, CNN ANCHOR: John, thanks very much. And good evening, everyone. Thanks for joining us at our new time. Beyond that, there is absolutely nothing festive about the occasion tonight.

We're coming to you from Kenya's Dadaab refugee camp just across the border from Somalia. Fighting and famine have driven nearly half a million Somalis to this camp in this area then the areas surrounding it. Giving Dadaab the terrible distinction of being the largest refugee camp right now on the entire planet.

As is almost always the case, this is by and large a manmade disaster. A bad drought, the worst drought in 60 years made worst by extremist Muslim terrorists called the al-Shabaab who control much of southern Somalia where the worst famine is.

As is also the case it is the children who are dying. Twenty- nine thousand children under the age of 5 have died in Somalia in the last 90 days. None of them had to die.

Tonight we'll take you inside this human catastrophe and show you the people who are trying to end it.

We begin, though, elsewhere the breaking news. Today's market meltdown in the United States. And we're watching what happens to markets coming up. There's looking live at the Tokyo Stock Exchange just now, open for Tuesday's trading. What happens here, both a preview of Wall Street tomorrow and reaction to what happened on Wall Street today.

As you know, the Dow Industrial Average plummeting down 634 points. Below 11000 for the first time since last October. Down 5.5 percent. It was a dramatic day on Wall Street. The Nasdaq and S&P down even more sharply. The market's volatility index way, way up.

We've got extensive coverage tonight, starting with two quick questions for chief business correspondent Ali Velshi who joins us now.

Ali, today what did it all this mean? I mean it was the biggest one-day drop since December 2008. What is going on?

ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Just a whole lot of uncertainty in the market. You know we saw what happened on Thursday with the uncertainty about what's going on in European debt, and then of course the downgrade that you and I talked about on Friday when it happened.

Here's the interesting thing. The downgrade should have caused credit to become more expensive for the U.S. government. But in fact, it had the opposite result. The 10-year note which is what mortgages in the United States are priced against actually went lower in interest.

So it cost the U.S. less money today to borrow money than it did on Friday. But there was a very strange, unusual and violent reaction in the stock market. It started last night when Asia started trading 24 hours ago, went through to Europe and then picked up steam in the U.S.

Anderson, a lot of the description here in the United States has been that this market reaction was a little bit overdone, exaggerated, perhaps even irrational. But the bottom line is the market is the market. People are very worried about the economy in Europe, the economy here in the United States.

What this downgrade meant bottom line is it was a treacherous, treacherous day on Wall Street. Very, very big losses.

COOPER: And Ali, what does that mean for people who are watching their 401(k), who are worried about interest rates? I mean what should people be think and doing?

VELSHI: Well, I'll tell you. On two levels, you need to be thinking about this. One is, as I mentioned, that 10-year note which is what mortgages are connected to, went down in interest. So interest rates being very low. They're historically low for mortgages anyway.

If you're in a fixed mortgage, you didn't get the reaction you thought you were going to get. So interest rates are probably, at least for a little while, going to stay lower. The problem of course is, as you mentioned, Anderson, people in their 401(k)s. This has been a few days now.

It's really been 10 out of the last 11 days we've seen the market go down. But between last Thursday's massive losses, 512 points, and then this 634 points, even bigger losses on the S&P 500 which is where your -- what your 401(k) or IRA would look like.

Very, very confusing. Traders I talked to, investors, managers, portfolio managers all said this does seem a little irrational. It's not like 2008 where there's a real reason for this market to be going down. It went down because of fear and panic overtaking rational thought. For the moment, most experts just saying sit this one out. Something will change shortly.

COOPER: All right. Ali, we're all watching Asian markets. We'll bring that to you through this hour.

Ali, thanks very much.

We're going to Erin Burnett coming up, as well as David Gergen. We'll also talk about the politics of all of this because instantly after this happened on Friday night when we were live on the air after the downgrade occurred, politicians just started to point the fingers one at another.

And the S&P in their downgrade said that is part of the problem. That's part of the reason they downgraded. So did the downgrade change any of that? Well, you're going to see. Our "Keeping Them Honest" report on that is coming up.

But I want to turn to what is happening in the Horn of Africa. Nearly 12 million people are at risk in the Horn of Africa. In Somalia, about 3.2 million people according to relief workers are in immediate need of assistance. Immediate need of assistance. Food assistance, in some cases, medical assistance.

Malnutrition in the number of -- for the kids who are reaching this camp which is now the largest refugee camp in the world. Just outside Somalia, inside Kenya. About 50 percent of the kids who are reaching here are malnourished. Severely malnourished. They're of course the most vulnerable.

And that statistics we told about at the top -- at the top of the hour a few moments ago. According to relief workers, at least 29,000 children under the age of 5 have died in the last three months. Twenty-nine thousand. Tens of thousands of others have already died.

A lot of it is happening in Somalia where there are no cameras. But you see it here in this refugee camp. We saw it firsthand today at a hospital run by the International Rescue Committee. Take a look.


COOPER (voice-over): It is a place of hope and horror. Children ward, International Rescue Committee hospital. Extra beds have been brought in for all the kids whose lives now hang in the balance.

Tanad (ph) is 6 months old and weighs just 6 pounds and should be twice that.

DR. HUMPHREY MUSYOKA, INTERNATIONAL RESCUE COMMITTEE: (INAUDIBLE) came in with diarrhea and vomiting. Was unable to retain any of the fluids and has been like this for around two weeks.

COOPER: Dr. Humphrey Musyoka has taught Tanad's mother to give him milk fortified with vitamins and protein. But so far it's not working.

(On camera): When a child comes in with diarrhea or vomiting --

MUSYOKA: So I mean --

COOPER: You've got to stop that.

MUSYOKA: We have to stop that.

COOPER: Before you can really treat the malnutrition. MUSYOKA: Yes. We do it concurrently but we usually have to stop the diarrhea and vomiting.

COOPER (voice-over): But that's not easy. Ladon is 4 years old and she too is wasting away.

Once kids can retain fluids, however, many are able to quickly come back to life. Nasro (ph) has only been here five days. The fact that she can sit up --

MUSYOKA: She can sit up and drink on her own is already turning around.

COOPER (on camera): Progress.

MUSYOKA: We're seeing progress.

COOPER (voice-over): But with severe malnutrition, the doctors can never be too sure.

(On camera): But even if the child is drinking milk and --

MUSYOKA: Even with a normal looking child.

COOPER: The child is good and then all of a sudden --

MUSYOKA: Then all of a sudden they can tip over to the other side.

COOPER: And they go very fast.

MUSYOKA: They go very fast. Very fast. In fact, what dehydration can do to a child in an hour --

COOPER: An hour?

MUSYOKA: In an hour is drastic. It's horrible.

COOPER: Really?

MUSYOKA: It's horrible.

COOPER (voice-over): Many of these kids have spent weeks on the road with their mothers between Somalia. It took Faisal's (ph) mom two weeks to get here. He is so dehydrated he needs a feeding tube.

MUSYOKA: At least they can get to a place where there are hospital neutral, where they're managed by (INAUDIBLE). The chances of survival I give it 80 percent.

COOPER (on camera): The key is getting here in time.

MUSYOKA: The key is getting here in time.

COOPER: Right.

MUSYOKA: The key is getting here in time.

COOPER (voice-over): Malnutrition is an age-old problem. These doctors now have a new weapon that has revolutionized it. It's a peanut paste packed with nutrients called plumpy nut. Once a child can eat, it is the first thing doctors give him.

MUSYOKA: This here is a -- this should be a miracle.

COOPER (on camera): A miracle. Nice to know that miracles can happen in here.

MUSYOKA: In here.


MUSYOKA: In here.

COOPER (voice-over): There are miracles, and there is misery. But Dr. Musyoka doesn't have time to dwell on either.

MUSYOKA: Our biggest challenge is that they will keep on coming. So how are you going to respond to that? How are you going to rise to that occasion? So it's very challenging mentally because you lose life. But what do you do about the next one will come.

COOPER (on camera): You can't mourn for the people who pass because more are still coming.

MUSYOKA: More are still coming. So we have to do something about that.


COOPER: Just a real conversation.

Joining us now is our own Dr. Sanjay Gupta, who's here with us. Also Amanda Lindhout, founder of the Global Enrichment Foundation, formerly a freelance journalist who's actually held captive for 15 months in Somalia by Somali militants.

Thanks so much for being with us.

Sanjay, in terms of what you've seen today, I mean, you hear the statistics, 3.5 million Somalis at risk right now, needing immediate food, attention, immediate attention. What did you see today? How bad is it?

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: Well, we saw, you know, obviously a more chronic situation than I expected. I think a lot of people are paying attention to this for the first time.

This camp, as you pointed out, the largest in the world. There are 300,000 people here last year. So 100,000 more over the last several months. But --

COOPER: This camp was built for 90,000 people. There's now 400,000 and about 65,000 outside.

GUPTA: That's right. And as you might expect, the lack of resources, the difficulty actually managing people. They try and do a pretty good job of registering people and making sure they're all accounted for. But beyond that, making sure they all get food, get the medical care that they need as well. That's going to be challenge. Simply having pediatric supplies, kids' supplies versus adult supplies, for example, those things are still challenging.

The people coming in here after these incredibly long journeys just absolutely famished and really in need of the most basic necessities. But it's the journey even more so than the drought --

COOPER: Right. Some people have walked for weeks through southern Somalia.

You know southern Somalia is ruled by Al-Shabaab which is an Islamic fundamentalist organization which have been battling for control of the country.

You actually drove into southern Somalia to deliver food. But only about 20 percent of southern Somalia has been accessible so far to food. What's it -- what's it like there? I mean what did you see?

AMANDA LINDHOUT, FOUNDER, GLOBAL ENRICHMENT FOUNDATION: Well, the situation in southern Somalia is very bad. And so central Somalia really needs to be addressed. Food aid needs to get in immediately.

I think one of the things that the big international organizations have been overlooking at that there are actually regions that food can get in. For example, the town that I went into, (INAUDIBLE). It's just across the border, and it's controlled by the Transitional Federal Government.

There's been a lot of politics and red tape that have prevented the international community until recently from getting food into those areas. And we really need to focus on the areas that are accessible right now and get food there. Why some of the big organizations, for example, the WFP, don't have feeding centers. And in those regions that aren't accessible, it's a question that hasn't been answered.

COOPER: Although -- I mean Al-Shabaab has been threatening aid workers, has kidnapped aid workers over the years. Executed some of them. So a lot of the big organizations have pulled out and Al- Shabaab themselves said they don't want foreign aid workers in their territory.

LINDHOUT: That's right. But an option that's not being looked at enough is that there are about 20 local Somali NGOs that have been working and providing very effectively humanitarian aid over the last two years after all the big guys were kicked out.

Now food can be -- and resources can be channeled through those local NGOs and therefore getting to the people. These organizations have been working, you know, underneath Al-Shabaab over the last two years and that's one way of getting food into areas that are the worst hit and most affected by the famine.

COOPER: Sanjay, in terms of this crisis, I mean, this is the worst drought they say that's been in 60 years. And it's going to continue for several more months.

GUPTA: Yes. And I think that the whole planning now, obviously, you know, this was not a sudden surprise. I mean they had forecast this a long time ago. But there just wasn't enough planning, either getting enough resources here or even into Somalia for some of the reasons that Amanda is mentioning as well. Just the concern about the conflict.

But now it's a question of what you do from here on out. You know, can you get some of this aid to the people who need it, who make these incredibly long journeys, and try and prepare for what these next several months are going to be like. Loss of crops, loss of livestock, and loss of food and water.

COOPER: You were held captive for 15 months by militants. I think if I was held captive, I'm not sure I would ever want to come back to Somalia. What makes you want to do this?

LINDHOUT: I think that experience in captivity actually provided me some pretty valuable insights into the conditions that are creating these generations of young people that only know violence.

So while I was in captivity or in the darkest periods of my captivity, I just made a promise to myself that if I made it out alive, I would dedicate my life to improving the conditions that are creating these generations of young people. And for the last year and a half, I've managed to do that.

COOPER: I was here back in '92, '93 when there was a famine. And it was my first big reporting assignment. I had never known Somalia not at war. I mean for the last 20 years since the dictator was overthrown, there has been war. There's really no central government here.

What do you -- what do you find interesting about Somalia? I mean what draws you to it?

LINDHOUT: Well, of course, my own personal experience in Somalia and the insights that I had there. And the commitment that I made to myself. And I actually, you know, people often speak about Somalia as a hopeless place. Not a failed state, et cetera. But I personally have a lot of hope for Somalia. I think that the future is in the young people.

And if we can provide educational opportunities for the young people, which is something I'm really actively involved in, I think that is -- that long term that is the future of Somalia.

COOPER: Well, thank you so much for being with us. Really a pleasure.

LINDHOUT: Thanks. COOPER: And we hope to talk to you in the days ahead.

And Sanjay, you'll be back a little bit later on tonight.


COOPER: All right. Thanks very much.

A lot more ahead in this hour. Let us know what you think. We're on Facebook, of course. You can follow me on Twitter, @Andersoncooper.

Sanjay and I have been tweeting up a lot.

Sanjay, what's your twitter? At --

GUPTA: Sanjayguptacnn.

COOPER: AtSanjayguptacnn. We're both trying to keep ahead of Piers Morgan here.

Up next, the market's reactions to Standard & Poor's clipping America's credit rating and why Washington is spending so much time still playing the blame game instead of fixing the problem.

We're keeping them honest ahead. And more from Somalia. First let's check in now with Isha Sesay to see what she's following -- Isha.

ISHA SESAY, CNN CORRESPONDENT: Anderson, the heartbreak is sinking in tonight from America's worst day in Afghanistan. A downed chopper and 30 U.S. troops killed including 22 Navy SEALS. Their remains now headed home.

That story and all the other headlines when 360 continues.


COOPER: Our breaking news tonight, the continuing market slide after Friday's debt downgrade. 634 points. That's what the Dow dropped today. In its explanation for dropping America's credit rating to a AA plus, the S&P roundly criticized Washington's dysfunctional politics, right?

Well, today the White House, President Obama slammed the downgrade but not the diagnosis.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: It's not a lack of plans or policies that's the problem here. It's a lack of political will in Washington. It's the insistence on drawing lines in the sand. A refusal to put what's best for the country ahead of self-interest or party or ideology. That's what we need to change.

(END OF VIDEO CLIP) COOPER: But keeping them honest, there's no proof that anyone has learned how to compromise. In fact there's proof positive that both are continuing to point fingers, playing the blame game and digging in their heels after a downgrade that was caused in no small part by people playing the blame game and digging in their heels.

Man, it did not take long. CNN first reported the downgrade Friday night around 8:30. We were on the air for it. Two hours later, House Speaker Boehner released the following statement. He said, quote, "This decision by S&P is the latest consequence of the out-of-control spending that has taken place in Washington for decades."

He went on to say, "The spending binge has resulted in job destroying, economic uncertainty, and now threatens to send destructive ripple effects across our credit markets."

And here's presidential candidate Mitt Romney that very same night. This was Friday night. Mitt Romney in a statement said, quote, "Standard & Poor's rating downgrade is a deeply troubling indicator of our country's decline under President Obama."

And Michele Bachmann? Well, today take a look.


REP. MICHELE BACHMANN (R), PRESIDENTIAL CANDIDATE: I've seen the only game these people now. Spend more, borrow more, tax more. That's the only game these people understand.


COOPER: Nothing anywhere about finding new revenue by raising taxes or closing loopholes or even deeper tax reform. Yet GOP intransigents on taxes factored into the downgrade.

I spoke Friday night to S&P's top man behind the downgrade. He took care to mention both taxes and entitlement spending and a no patience for finger pointing. Watch.


COOPER: Already on Twitter, other places, Republicans and Democrats are pointing the fingers at each other. President Obama and Congress. Do you mean blame one side more than the other?

JOHN CHAMBERS, STANDARD & POOR'S MANAGING DIRECTOR: No. I think there is plenty of blame to go around. This is a problem that's been a long time in the making well over this administration, the prior administration. The -- it's a matter of the medium and long-term budget position of the United States that needs to be brought under control. Not the immediate fiscal position.

It's one that centers on entitlements and it's entitlement reform or having matching revenues to pay for those entitlements that's at the crux of the matter. (END OF VIDEO CLIP)

COOPER: So Republicans won't talk taxes and they're slamming President Obama. Democrats, well, they kind of have a two-part approach. One is blaming -- well, take a look.


SEN. JOHN KERRY (D), MASSACHUSETTS: I believe this is without question the Tea Party downgrade.

DAVID AXELROD, OBAMA CAMPAIGN ADVISER: The fact of the matter is that this is essentially a Tea Party downgrade.

GOV. MARTIN O'MALLEY (D), MARYLAND: Tea Party obstructionism here in Washington.

HOWARD DEAN, FORMER DNC CHAIRMAN: I think they've been smoking some of that tea. Not just drinking it.


COOPER: OK. All right. Blaming the Tea Party, that is part one. Part two is not budging, at least not publicly, on entitlement benefits.

Well, last week Talking Points Memo asked House minority leader Pelosi whether the people she appoints, the debt reduction committee, would oppose any such cuts to Medicare. And guess what? She said yes.


REP. NANCY PELOSI (D), MINORITY LEADER: That is a priority for us. But let me say it is more than a priority. It is a value. It's an ethic for the American people.


COOPER: So her three-member panel won't budge and leading Republicans won't budge on taxes. Meantime, it's worth to remind her that S&P's downgrade also came with a warning that another downgrade may be in store if Washington can't stop bickering.

So do you think that's going to happen? Let's talk about it.

Joining me is former spokesperson for President George W. Bush, Ari Fleischer. You can now find him on Twitter, @Arifleischer. Also joining us, Democratic strategist, Donna Brazile.

And Donna, it seems like Washington's immediate reaction after the downgrading was both sides, Democrats and Republicans, pointing fingers at one another. Wasn't this an opportunity -- in fact, you know, the opportunity to say, you know what, this is a really serious time for our country and we're going to look at ourselves first before we point other fingers at other people? DONNA BRAZILE, DEMOCRATIC STRATEGIST: Well, Anderson, I believe the response was very predictable. After all the two major parties had some really major differences at this point in terms of how to get the economy growing again.

I think over the next couple of days, you'll see not only the president emerge to bring the discussion back front and center on jobs. But also, perhaps Speaker Boehner and the leaders appoint in the United States Senate will also appoint members to the so-called congressional super committee who are committed to looking long term at America's fiscal problems. Not just by cutting spending but also increasing revenues.

When we extended the Bush tax cuts in December that is $847 billion in revenue that the government can no longer collect and therefore how do you balance a budget when all we're doing is cutting taxes, cutting revenue.

ARI FLEISCHER, FORMER WHITE HOUSE PRESS SECRETARY FOR PRES. G.W. BUSH: The big issue, though, is it doesn't matter what area you serve in. A crisis is going to arise on every president's watch. The crisis in the Bush years was 911 and terrorism.

And President Bush spent considerable money in fighting terrorism. Part of the problem that Barack Obama has now is some of that spending. There's no question about it. But a bigger part is all the spending Barack Obama has done.

The fact is that in four years of Barack Obama he will increase the debt by more than George Bush did in eight years of George Bush. The question now is solving problems and the leadership that Barack Obama has to pick and show to respond to the debt the same way George Bush responded to 9/11.

This is the crisis that's come up on his watch and it doesn't do any good to blame your predecessor or blame the S&P. Standard & Poor's. You have to solve --


BRAZILE: Absolutely, Ari.

FLEISCHER: So that's where we are.

BRAZILE: Ari, S&P --

FLEISCHER: But Donna, here's the other problem. Here's the other problem that we have.

BRAZILE: S&P slept through -- S&P slept through --

FLEISCHER: Hold on, Donna. Let me finish. Let me finish --

BRAZILE: S&P -- no, no.

FLEISCHER: Let me finish and I'll get right to you. BRAZILE: No, no. Ari, S&P slept through --

FLEISCHER: In the Obama budget --

BRAZILE: S&P slept through the junk crisis. S&P was not even on the watch when they were given these toxic instruments. These AAA rating when it was basically junk.

Let's go back to the housing crisis and how S&P handled that. So look, one bonding agency, one rating agency given the United States a downgrade shouldn't, you know, force us to throw in the towel.


FLEISCHER: Who's talking about throwing towel? We're talking about solving problems.

BRAZILE: We should look -- we should look at some of the good -- Ari, we should look at some of the good things that have been happening over the last two years. It's not all gloom and doom.

Look, prior to the earthquake in Japan, prior to some of the other rising gas prices, we saw -- we were seeing private sector job growth come back. We need to get back to that. We need to focus on the positives in our economy and stop blaming politicians for all of the problems that we're facing in this country. Because quite frankly the private sector also needs to step up and stop pointing fingers at the political dysfunction as well.

FLEISCHER: Well, it'd be nice if there were some more positives in this economy. But as we all just learned, and this is one of the reasons the market has tanked growth in the first half of this year, it's coming less than 1 percentage point.

And so we actually have an economy that's going in the wrong direction now at a time when we need it to grow. It's actually starting to fall back. Some people are talking about front page of the "New York Times" business section this week, a double-dip recession.

The other problem going forward, though, is President Obama has proposed 50 percent increase in government spending. In 2008, the government spent $3.0 trillion. And the budget the president submitted to Congress this year, he calls for the government to spend $4.5 trillion in 2016. A 50 percent spending increase. That's my point about it.


BRAZILE: And you know what most of that spending is coming from?

FLEISCHER: He never took the debt seriously until April of this year.

BRAZILE: Do you -- come on, Ari.

FLEISCHER: The president gave a speech about the debt.

BRAZILE: Ari, that is -- that's not true.

FLEISCHER: He never tackled the debt -- Donna, the numbers are precisely what I just said. A 50 percent increase in spending by President Obama.

BRAZILE: Ari, Ari, he came up with $4 trillion --

FLEISCHER: Donna, the debt --

BRAZILE: He came up with a $4 trillion of --

FLEISCHER: The debt under President Obama's budget was going to $26.3 trillion.

BRAZILE: That's one thing. You know you can accuse me a lot but that one had a (INAUDIBLE), not one of my flaws.


COOPER: We're going to wrap it up.

FLEISCHER: Look it up, $56.3 trillion --

BRAZILE: $4 trillion in --

COOPER: I'm at a disadvantage because of the time delay so I'm sorry to not be able to jump in more. But I appreciate your time. Thank you very much. We're going to continue the discussion again.

Ari, Donna, thank you.

BRAZILE: Thank you.

COOPER: It's weird having people argue thousands of mile away. It's very hard to jump in when there's a time delay so I apologize if it was annoying for viewers, for you at home. But good perspectives from both of them.

Coming up we're going to talk to Erin Burnett and our own David Gergen about the politics of all this, what President Obama said today, and what this means for folks at home when you're looking at your 401(k)s, when you're worried about mortgages and interest rates. Erin Burnett has some thoughts on that.

Also then, the life and death crisis that is happening right here all around us here in the border with Somalia. And tomorrow we'll be inside Somalia itself reporting from Mogadishu.

I'll be back with Dr. Sanjay Gupta and others. We'll show what like is like here for the kids and for the more than 1200 people who are still arriving at this refugee camp that is already over capacity with nearly half a million people here receiving food aid, receiving medical attention and water.

We'll be right back.


COOPER: Covering the breaking news here along the Somalia border and inside Somalia, the famine crisis and also the breaking news at home. Heavy losses on Wall Street today especially for the S&P 500 index, which of course, matters more than the Dow.

Because so many retirement accounts, so many retirement accounts are heavily invested in S&P companies. Erin Burnett, CNN's latest addition which we're very excited about is joining us tonight so is senior political analyst, David Gergen.

Erin, is there really much that the U.S. government can do about this? Because, I mean, is it a lot of what happened today also involved in what's going on in Europe and in Japan?

ERIN BURNETT, CNN ANCHOR: It is. It has become completely global. All the economies link together and the debt problem a global one as well, Anderson. There is something that can be done both by lawmakers in Washington and also by the fed.

The fed meets tomorrow on interest rates. That's going to be really crucial. Ben Bernanke, teeth of the fed, the most important player right now. What he decides to do, what he says about economic growth in this country in his statement.

And also, if he says there is something further the fed could do, those will be very crucial things tomorrow. But he has to get the nuance just right or he could scare the markets out.

Lawmakers, we all know, Anderson, there are things they could do. For example, show some leadership and that they can work together, but they're on recess and we're not going to get anything out of them now.

COOPER: And David, President Obama spoke today. A, how do you think he did in terms of what he said and what more needs to be done or can be done?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: Well, Anderson, President Obama did his best today to reassure the markets, but it is clear now that words alone are not enough.

When the president spoke in the afternoon to try to reassure people, the Dow was down about 400. By the end of the day, it was down another 200 points. So I do think people are looking for action.

What could he do? He could call the congressional leader back to Washington from their vacation and see if he can cut a deal on jobs. Not only debt but on jobs. That is the most urgent issue. He wants unemployment insurance extended. He wants pay roll tax cuts extended.

The Republicans want regulations reduced or a moratorium on new regulations. They want the immigration of more talented immigrants. They've got some things in their agenda. Cut a deal now on jobs to give people reinsurance as something that's happening. I also think Anderson, it's very important for the president to form a council of heavyweights around him because right now, people don't have enough in government generally and in politician.

Do take some steps, today was too much, his statement frankly was just too much same old same old. As much as I respect him, it was same old same old. It didn't work.

COOPER: But it's interesting, Erin, David's point about getting a council, you know, you have Tim Geithner who has real world experience and yet, there are a lot of folks on the Republican side who would like the get rid of him.

BURNETT: Yes, it's true. I mean, it does seem to be just politics as usual. The president has tried and not been that successful with some of these councils that he's tried with jobs and competitiveness. This may be the time as David says to try to come up with one that actually has some power to do something.

GERGEN: The very point is here that people who are out of the country, first thing in investment community are desperate for Washington to get beyond politics for a change, to put down the political battles and focus on getting some real progress.

The clear merit to more point, the president ought to stop his 2012 campaign for a while and get some focus. Try to get this economy reignited and then everybody can go back to the politics and the sand box and everything else.

COOPER: I think a lot of Americans would appreciate it if whether it is Republican or a Democrat, you know, looked inward and kind of took some responsibility and said, you know what? Both sides, both of us, both our sides have a share in this, contributed to this problem. And are actually going to show some leadership and not just point fingers, but look inward. You never hear that from any politician.

GERGEN: Anderson, you're so right. It is interesting. I got an e-mail from a leading person in the investment community, an awful lot of investors who said exactly that. That's what people would welcome so much if both sides said, we take our responsibility.

We've all done wrong here and we need to get together and get some of these problems solved. It would be so helpful to the country. I can't tell you how disgusted people are and frustrated they are with the politics dominating everything as opposed to some really constructive national effort.

COOPER: Erin Burnett, good to have you on. David Gergen as well. Thanks.

GERGEN: Thank you.

COOPER: And still ahead tonight, more from the largest refugee camp in the world. About half a million Somalis who's are here in desperate need, many of them. We'll have the latest from here. Jill Biden was here today. I interviewed her and we'll have some of that and also former senator, Dr. Bill Frist was here. I'll talk to him as well.

Also Sanjay Gupta profiles a father who walked some 30 days, days and nights in order to save his children and get them here where they can receive medical attention, where they can receive food aid. A lot of stories like that. We'll introduce you to some of the people coming up.

And also, crazy going on in London. Riots there continuing. We'll have the latest on that. We'll be right back.


COOPER: So many people have walked for days, for weeks to escape Somalia to come here in Kenya, to try to get medical attention, to try to get food, to try to get water.

The conditions in southern Somalia, that is where the famine is, are truly horrific in many cases, as many as 50 percent of the children here under 5 years old who are arriving now are malnourished.

We saw a lot of them in the hospital today. Coming up, Dr. Sanjay Gupta is going to talk to a man who walk for some 30 days in order to save his kids. First, Isha Sesay joins with the 360 news and bulletin. Isha, what are you covering?

ISHA SESAY, CNN CORRESPONDENT: Anderson, remains of the 30 U.S. service members killed in a chopper crash in Afghanistan are headed for the Dover Air Force Base in Delaware. Twenty two of the victims were Navy SEALs. NATO is investigating Saturday's crash. The chopper reportedly went down after insurgents fired a rocket propelled grenade at it.

Police are on alert across Britain as rioting spread. The unrest began Saturday in London during a vigil for 29-year-old black man who was shot and killed when police stopped the taxi he was in. Prime Minister David Cameron is cutting his vacation short to attend meetings on the crisis.

About 45,000 union workers at Verizon have walked off the job after talks of a new contract stalled. A spokesman said there should be no major impact from the strike though some repair calls may take longer.

And 61-year-old endurance swimmer, Diana Nyad is trying to become the first person to swim between Cuba and Florida without a shark cage. She said she is more fit today than she was 33 years ago when she first tried to swim, but was unable to finish. Anderson, the swim apparently estimated to take about 60 hours.

COOPER: That is a brutal swim. Without a shark cage, that is incredible. Let's hope she makes it all the way. Isha, thanks very much. Besides financial aid, the U.S. is providing some high level moral support to Somalis. Jill Biden, the wife of Vice President Joe Biden, along with other U.S. dignitaries visited Dadaab, this camp today. We spent some time with her.

This is part of an effort by the U.S. to underscore its commitment to tackling the famine. She came in on a fact finding mission. She is especially concerned that the effect of the crisis on Somali kids.

Fifty percent of them arriving into the camp are malnourished as many as one third in southern Somalia are malnourished. The "New York Times" says, Somali children, about half a million are on the brink of starvation.

We talked to Jill Biden about the crisis and what she saw today in a desperate situation that so many Somali mothers are facing. Take a look.


COOPER: Have you ever been to a camp like this?

JILL BIDEN, WIFE OF VICE PRESIDENT JOE BIDEN: No. I've never been to a camp like this.

COOPER: It is one thing to see pictures in the news or the papers, but to actually see it up close.

BIDEN: And that's why I wanted to come. I was seeing it in the paper and I was seeing it in the news and I just couldn't imagine being a mother myself, that someone wouldn't help my children. And I think that's why these women have walked from Somalia.

They've walked 15 to 30 days to bring their children here to get them food and water and health care and that's what's needed. And we need donations. We need people to just give a little bit.

I know we have tough economic times in the United States, but if everybody could just see what's going on here, it is a desperate situation. And there is end this. The rains will come.

I mean, this was caused by famine, the famine by the drought. So rains will come in October, but we have to help these mothers save their children.

COOPER: I saw you talking with a family. What were they saying?

BIDEN: That mother had walked for 15 days. There is no male head of household and she said can you help me? Can you help me? I have my children. Her little baby was sick and with diarrhea and so they desperately are seeking help.

COOPER: And diarrhea here, so many kids die with diarrhea. They can't replenish their fluids. BIDEN: Yes. So Americans, if they could just give a donation, they could pay for vaccines, for measles for these kids. They could pay for water. They could pay for food if they would go to They could choose the donation, where they would want the donation to go and help the children. Help the children live.


COOPER: She really wanted to come here to see it for herself and do whatever she could to bring attention to it. You can see the full interview on Tomorrow, we'll put up the full interview with Dr. Frist, former Senator Frist who is also here as part of Joe Biden's fact finding mission.

Coming up, families affected by the famine. Dr. Sanjay Gupta showing us the efforts underway to help the youngest victims survive.


COOPER: Welcome back. We are in Dadaab, the largest refugee camp now in the world along the Somali border in Kenya. What's so remarkable and horrific about what's happening here is that in a sense it is history repeating itself and innocent people are suffering and dying.

Nineteen years ago this very month, I actually was in Somalia reporting on famine. It was one of the first stories I covered as a young reporter. The famine back then killed about 300,000 people.

I want to show you some of what I saw in a town called Baidoa, this was in 1992, this very month in August, 19 years ago this month, nearly this month to the day. A town, Baidoa, with about 100 people were dying every day of malnutrition and from the conflicts. Take a look.


COOPER: Death and suffering everywhere here in Baidoa. I was walking down this road and just came upon a family whose son just died while I was standing there. They're now washing his body. You want to do something.

You want to cry out. You want to grab someone and get them to help, but there is no help to be had and there's no one around. For a lot of these people, it is too late.

The relief supplies are coming, but they've been suffering for months and they're going to die and there is nothing you can do.

(voice-over): I sat and watched the boy's father use what little water he had to clean his son's body. They had come here because they had heard there was food here. The father had already watched two other boys die. This was his last. He was 5 years old.

(END VIDEO CLIP) COOPER: It was happening a thousand time a day in places like that all over Somalia 19 years ago. And here we are 19 years later and it is happening again. Ten of thousands may have already died.

An estimated 29,000 kids according to aid workers under the age of 5 have already died just in the last three months. Parents are desperate to save their children from a slow and painful death.

But famine is a powerful opponent and we're finding a lot of people who have walked for weeks with their children, many with multiple children just to try to get them here. Some kids have died along the way.

Some adults have died along the way and we'll never know their stories or we'll never know their names. But many have reached here. Many have been able to save their kids. Dr. Sanjay Gupta visited the youngest victim at a medical aid station today. Take a look at what he found.


DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: What you're looking at may best be described as the most desperate place on earth, vulnerable children, thick with misery.

(on camera): You can tell right away when you see a little baby here. You can take a look here, the baby's fontanel, it's so sunken in. This is what happens when they have no food, no water so dehydrated.

(voice-over): Basic, basic necessities so hard to come by. Dust and starvation nearly everywhere you look.

(on camera): This is also what happens when you're at the world's largest refugee camp, all these folks waiting to see one doctor over here.

(voice-over): As you look at these images, consider this simple fact. These are the lucky ones, lucky because they made it here at all. This family of five made it out of Somalia just yesterday.

(on camera): Came out here to the middle of the desert to give you a real idea of what this family went through. They walked for 30 days and 30 nights. Primarily walking at night because it was cooler carrying those three kids, sometime carrying a kid, going back, getting another kid and then just doing this over and over again in the desert. Thirty nights' worth, they crossed the border and then they get robbed. Bandits take what little possessions they actually have.

(voice-over): But the bandits didn't take this father's dream and his drive to keep his kids alive. It's not going to be easy.

(on camera): This is another thing you see quite a bit. This child obviously, 3 months old, looking very listless. Just not very active at all. Look at his breathing specifically. He is breathing with his abdomen, not so much with his chest, which is something very tiring for a baby. He also has whooping cough, pertussis because the child was never vaccinated either.

He will need a hospital, oxygen, antibiotics, and yes, food and water. All of it may come too late. So painful to realize that every single one of his ailments could have been prevented, unfortunately that hardly ever happens in the most desperate places on earth.


COOPER: I'm joined again by Dr. Sanjay Gupta. Also here with David McKenzie who has been on the ground covering this story for weeks and CNN Nema joins us from Mogadishu, Somalia's capital where we'll be reporting tomorrow.

Sanjay, I mean, it's incredible, the journeys people have taken just to get here.

GUPTA: Yes, I mean, they really have no choice. That's what we're sort of finding. The aid again, keeping in mind that this was not a surprise. This was not unexpected.

COOPER: People have known for months and months and months.

GUPTA: This could have been prepared for. That was really just striking that so much of what you just saw there was absolutely preventable, which I think --

COOPER: So little of the way we prepare for this has changed though. It is not until people see the images that they really think it is real.

GUPTA: You've seen this for 19 years as you pointed out. The journey for them, I think it was probably the hardest part of the whole thing. It was harder than dealing with the loss of crops, the loss of livestock, all of that. The journey, I mean, they walked for 30 nights essentially to get here.

COOPER: And David, you've been covering this for weeks now. People are still coming about 1,200 every single day. The numbers just in the last two months, they've seen more people in the last two months than any previous two months before.

DAVID MCKENZIE, CNN CORRESPONDENT: Last month 30,000 people came to this camp. They've been dealing with maybe a couple of thousand a week, Anderson. Thirty thousand in a month is hard for these aid agencies to deal with.

You said at the beginning of the show, you know, this camp has been here a long time, 300,000 to 400,000 people here. But it is the new arrivals that's the struggle. The people coming in, they can't even make it into the camps. They go to what they call the outskirts of these camps. They're living under ram shackle huts --

COOPER: No running water, no toilets. MCKENZIE: No running water, no toilets. Often they are struggling to access food. We went to a place two weeks ago where a father was burying his young child. The name was Sarah. We went back there today hoping the situation had been better.

And we went into their hit and he was now listless, lying with respiratory problems, had a fever and the blasting winds coming through camps. People are really struggling. They want a better life. Sometimes when they get here despite the efforts of the aid agencies, it is even worse.

COOPER: This is a manmade disaster.

MCKENZIE: It is a manmade disaster. There is no such thing in many experts mind as a famine in the 21st Century that isn't caused by man. You've got high food prices. You've got markets that aren't working.

Between the countries of the east African, the horn of Africa and we mustn't forget Somalia. The conflict in Somalia, this El Shabaab militia group, the Islamic militia group is stopping aid from getting in. And people are streaming out like Sanjay described.

COOPER: And they stop vaccinations. Anybody from vaccinating saying they are a western plot to kill Somali children.

GUPTA: Yes, and I was not quite sure what I would see here. But I saw pertussis, which is whooping cough right away. They talk about measles, diphtheria, tetanus, all of that, again, preventable problems as David is saying. That we know how to deal with. Yet they worry that there is so much distrust that that still exists.

COOPER: Nima, you're in Mogadishu where El Shabaab has been battling with this fragmented transitional government for a long time. They just allegedly left Mogadishu. What is the latest there? Has El Shabaab really left the capital?

NIMA ELBAGIR, CNN CORRESPONDENT: Well, they called it a withdrawal. But really I think what it is, is they have been pushed out of the capital by the government forces. Not just because of superior fire power.

But because they've lost a lot of their grassroots support. That edict banning aid group has hit them really hard. So over the weekend, there was a sense of optimism that perhaps this could mean the aid corridors throughout the capital would open up.

But today unfortunately we've already had an attempted suicide attack. Four people were injured when a would-be suicide bomber luckily detonated prematurely.

So now we've gone from that optimism over the weekend to perhaps people just sitting back watching and waiting. But there's no doubt about it. It is good news in terms of aid delivery here in Mogadishu. If only the aid could actually get here, Anderson. COOPER: And you have 100,000 people who have actually been internally displace and have gone to Mogadishu seeking food. We're going to be there tomorrow. Nima, we're going to talk a lot more to you there. To David McKenzie as well, has a lot changed in this camp in the time you've been here?

MCKENZIE: It changes and it stays the same, Anderson. I mean, people are piling into these areas. They are locating people from the outside of the camp, pushing into camps there. But they're not helping.

COOPER: We'll have more from David in the days ahead and also Dr. Sanjay Gupta. We're continuing to stay on this story. For information on how you can then victims of the famine, to go our web site, We'll be right back.


COOPER: We'll continue reporting on the crisis here over the next two nights. Dr. Sanjay Gupta is going to stay here at this camp for the next two nights. I'll go with my team to Mogadishu to see the situation there, both the security situation and the food situation.

Also tomorrow, you don't want to miss my interview with super model Iman. She was, of course, born in Somalia and has a very personal perspective on what's happening here. Here's some of what she had to say.


IMAN, SOMALI-BORN SUPERMODEL: Regardless of the conflict and regardless of the political issue happening in Somalia, what is happening for a fact, for a fact, it is a humanitarian catastrophe and this famine will be remembered as a famine that has destroyed generations of children. And we have I think we are in a place now that we can actually turn it around.


COOPER: Iman has a lot more to say about the famine and the need to put an end to the destruction in Somalia. It's a great conversation. We'll have her on the program tomorrow. We'll run the whole interview tomorrow night on "360" live from Mogadishu.

That does it for this special edition of "360." I appreciate you watching us at our new time at 8:00 and we'll be on at 10:00 Eastern on the east coast of the United States and all across the world. "PIERS MORGAN TONIGHT" starts now. Let's toss it over to Piers. Piers.