that does it for this special investigation. we'll continue to watch the charities that drew has been reporting on and bring you any updates and investigate other charities as well. remember, there are a lot of good charities out there. don't let the questionable actions of a few stop you from "outfront" next, the june jobs report is out, and it's not good. but does it add up to all doom and gloom? and claims of abuse and neglect at a hospital backed by american taxpayer money. tonight, the whistle blower speaks out, exclusively to outfront. and mcdonald's, the only branded food you'll find at the olympic village in london. the fast food chain says it has healthy options. does that add up? let's go "outfront." good evening, everyone. i'm erin burnett. "outfront" tonight, summer blues. depression set in early today,

and it set in hard. there were only 80,000 jobs added in this country in june, and the 8.2% unemployment rate didn't budge. ♪ yep. the stock market plunged, politicians and analysts alike sounded like they were on the edge of a cliff. >> there's a lot of misery in america today. and these numbers understate what people are feeling, and the amount of pain which is occurring in middle class america. >> peter buickvar equity strategist tells "outfront" the jobs numbers are quote, pathetic. chief u.s. economist says another month, another sub par employment report. mitt romney had it right. there is a lot of pain in a lot places, but does all the doom and glood at up? yes, the jobs numbers weren't great, but this is a glass we're choosing to see a little bit more half full. and most americans agree with us. a new cnn poll shows 60% of

people are optimistic and think economic conditions next year will be good. one reason for this is housing. it's a little ironic, perhaps, because the housing market is what got our economy in this crisis back in 2008. but here are a couple of numbers that really might add up. pending home sales in may hit their highest level in the past two years, according to the national association of realtors. and we saw gains across the entire country. and not just specific regions. and the most recent s&p case-shiller index, which really is the benchmark for housing prices, shows that home values rose on a month-to-month basis in april for the first time this year. you add on to all of that 30-year mortgage rates. when you look at those, they're at a record low. a percent lower than a year ago. homes are more affordable. stuart miller is the ceo of home building giant will henar and also a member of our strike team and told used to, quote, housing is at least stabilizing. i think if housing continues its current trajectory, it will assume its traditional role of leading a domestic recovery.

so is housing the knight in shining arrest more? outfront tonight, jim bianco, investment analysis, and dan gross, economics editor. obviously the numbers today were grim. people found shards of a silver lining. what about this take on housing? it's been sneaking up consistently as improving. >> this is a little drum that i've been pounding on, and i'm glad to see you take a bigger mal lot to it. it's not just the home prices. it's housing-related activity. it's the volume of sales, because that translates into money for brokers and insurers and taxes that are paid. and it's the volume of new housinging starts, up 25% through the first five or six months. we've seen these mini recoveries, but nothing sustained like this. and so the data shows numbers are way below where they were at their peak, but bouncing off their bottom in a sustained way. the great thing about housing, it's this overwhelmingly

domestic sector. >> right. >> all the jobs, the contractors, the landscaper, the mover, broker, la lawyer. >> you can't outsource it. do you think housing can sustain the recovery. you can't have a recovery without housing and for so long we haven't had people building new homes. we've been working through this glut. are we finally going to be there? >> i hope so. i hope it will be a 2013 story. it's still a little early to tell whether or not we're there. we're bumping along towards the bottom. we've seen this over the last couple years, where housing appears to stabilize, and then it slips back down. but if you're looking for the economic engine, it's really got to be in the new starts and construction area. when a home is built, it creates five times as much economic activity than a home that is sold. so hopefully we're going to get the new home sales, permit numbers will go up, too. and that will be an engine for recovery, provided, of course, it happens. >> and, jim, i know provided, of course, it happens, obviously is the caveat you're giving.

but when it does, it could be pretty incredible, right? is i mean, because we've just been at such a low level for so long, the uptick in terms of construction, construction jobs, all of this, could really just be -- you're looking at jobs and things. these could be big numbers, right? >> oh, yeah. there's two things about that. one, when you have a market like housing that's down as much as it has, it typically will overshoot. so it will go too far the other direction. so when it comes back, it will come roaring back. when remember that housing will create the last vasstage of let's call it unskilled labor. where does somebody go that's got a high school degree at good wages, usually housing is a place or construction is a place you can get a job that you can make good money at. and if they come back, that could be really good jobs for people that are desperately in search of those jobs. >> and that would be a great thing for this country. dan, today's jobs numbers. did you see a silver lining? >> you have to look very hard. >> right. >> the number of hours worked in a typical week bumped up.

and the wages bumped up by a pretty decent number. almost one half of one percentage point. you put those two together, means more people getting paid. what that meant was, as companies had more demand, instead of hiring new people, they kind of asked their employees to do more. >> right. >> and agreed to pay them a little more. in a normal recovery, in a normal expansion, that's the type of activity that happens. but that is frequently accompanied by jobs being added at a more rapid rate. >> jim bianco, did you see anything good in this jobs number, or how would you grade it? >> i would grade this jobs number overall probably around a c minus. it's really not that good. but if there was one good spot, it was in the manufacturing area. we are starting to create jobs. we've had a great manufacturing productivity boom that has cut jobs from manufacturing for the last 30 years. and right now we seem to be stabilizing in the manufacturing sector right now. and maybe we'll be creating more jobs as we go forward. >> i'm going to leave that on a silver lining on a lot of fronts. and hopefully we made you see there is a different way to look

at that bad headline today. still "outfront," mitt romney is making big changes in his campaign. and one man taking on new responsibilities is "outfront." and scott peterson, you remember him, sentenced to death for killing his wife and unborn son. now he's appealing that sentence. our paul callen thinks there is a chance he could win. and is it possible for airlines to keep fares low and fly safely? mine was earned off vietnam in 1968. over the south pacific in 1943. i got mine in iraq, 2003.

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now our second story "outfront." a change at the top of mitt romney's team. influential conservative voices, including "the wall street journal" "the weekly standard" have criticized the campaign this week from everything from staffing to messaging. it looks like mitt romney may be taking some words to heart, announcing today that senior adviser kevin madden will take on a bigger communications role, starting, drum roll, right now. hey, how are you, kevin?

>> great to be with you, erin. >> so tell me. obviously, you were a senior adviser before. tell me what you're going to be doing differently. obviously, you do tv. you do well on tv. viewers know who you are, they've seen you on this show and others. i assume your elevation in communications is an acknowledgment they needed more of those skills. >> well, you know, i think that this is -- we're entering that critical phase of the campaign. we're looking at 19 weeks to go. about 120 days. i think right now a lot of voters are beginning to focus on the campaign, we're going to be doing a lot more travel. so i expect that as the press corps begins to travel more with the governor, i'll be working with the press corps that's traveling with the governor, to articulate his message to the american people about how he wants to see a stronger economy and what his plans for a stronger america are. so i think this is a natural part of this campaign. i don't really think it's big news. because this is what happens at this juncture in the campaign. more senior folks come on and help because the band width needs to get larger at this point in the campaign.

>> let me just say, you know, in case you were on vacation this week, something that happened this week that made me think that, you know, maybe there was something to this, naming you in this role. here is eric fehrnstrom, also a senior adviser and mitt romney. >> the governor believes that what we put in place in massachusetts was a penalty. and he disagrees with the court's ruling that the mandate was a tax. >> the supreme court is the final word, right? highest court in the land? they said it was a tax, didn't they? so it's a tax, of course. that's what they say it is. >> so are you going to clear that up, kevin? >> well, i think, look, the governor spoke on this. i think for all the emphasis that we put on staff, staff really don't matter. what matters at the end of the day is the candidate, his vision, his words. and governor romney made very clear what he believes. he's made very clear, this is an election that voters are looking for a choice on the issue of obama care. you have one candidate that wants to keep it and believes the taxes, the regulations, the size and scope are good. and one candidate that believes it's not helpful for the

american public and wants to repeal it and replace it with more patient-centered care. that is what is on the ballot in november. all this talk about penalties and taxes, that's not as important as whether or not we're going to continue with that policy. and governor romney has said on day one, he would act to repeal it. >> see, you're already doing your job. you've diverted the conversation. i think viewers see exactly what you're doing. final question, kevin, quickly. "the wall street journal," jack welch, rupert murdoch have criticized the staffing. is that the answer to the campaign? how much? >> campaigns get a lot of people saying good things about us, saying we're doing a great job and other folks saying we need to do a better job. i think the most important thing for every campaign is to put it in perspective, take all that information in, process it, and make sure that what you're doing every single day is living up to the expectations, high expectations, that people have for your campaign. and that comes from people that are observing as reporters, and pundits, and that comes from people observing as supporters,

people that want to see governor romney win. i think as a campaign, we're very focused on living up to the high expectations, and we listen to that advice, whether it's constructive criticism or whether it's praise and we do our best. the most important thing we can do is go out there and articulate governor romney's message for what he wants to do for the country. >> thanks very much to kevin madden. we appreciate it. >> great to be with you. >> john avalon worked on the campaign, michael walden on president clinton's 1992 campaign. good to see both of you. i have to say, michael, he's doing his job. already diverting. he's going to repeal it. move on, people. >> i miss eric fehrnstrom, who they have probably locked into a sound proof room, because he kept accidentally speaking the truth into the camera. and when does that happen? the problem for mitt romney is not shifting spokes people. it's that he's pinned between the demands of the right wing in the republican party, which is extremely powerful, and extremely vocal, and a message he might want to talk to the country about and policies he

might want to talk to the country about. so he's got to explain why his signature program of individual mandate-based universal health care in massachusetts is somehow different from what president obama did, and is somehow good and bad at the same time. and that's not about spokes people. that's about philosophy and policy. >> and is so john does he need to do that explaining or does he just need to say forget the nuance? we need to repeal it. >> i think kevin madden gave a good view what they are going to do. sounds like the role is something like a traveling communications director. in proximity to the candidate is enormously important when you're at this stage of the campaign. that's the access you need. that's what you need to really drive the message. look, i think all these cause for a major contain campaign shake-up are a mistake. it's enormously important to have a campaign team that understands the candidate as a person, who the candidate trusts and vice versa. >> which his team does. >> which his team does. by bringing madden on a more senior role, who was with him in

2008, who knows the governor well, they're doing exactly what they should do. they're broadening the base of senior leadership, but they're not grafting on to an entirely new personality, because that would have really i think undercut a campaign in a critical moment. >> does this happen -- mitt romney had momentum and now barack obama has the momentum. he's had a couple stumbles. people start shooting and say shake it up? >> every campaign. every campaign. and john is right. it was a real strength for obama last time that he had a loyal team based in chicago. it's been a strength for romney that he has a loyal team based in boston. in the past, having your campaign outside of washington was a way to insulate it from the kind of second-guessing in the coat room at the pom. same with clinton in '92 when we were all down in little rock. but now everything is done on twitter, and you can't get away from the know it always. so i think this ultimately will not have much of a difference when it comes to voting in had november. i don't think. >> thanks so much john and michael. appreciate it.

"outfront" next, an exclusive investigation into allegations of abuse and neglect at a hospital backed by you. american taxpayers. and is saving a few dollars on an airline ticket actually putting your safety at risk? great shot. how did the nba become the hottest league on the planet? by building on the cisco intelligent network they're able to serve up live video, and instant replays, creating fans from berlin to beijing. what can we help you build? nice shot kid. the nba around the world built by the only company that could. cisco. focus lolo, focust sanya let's do this i am from baltimore south carolina... bloomington, california... austin, texas... we are all here to represent the country we love

this is for everyone back home it's go time. across america, we're all committed to team usa. delivering mail, medicine and packages. yet the house is considering a bill to close thousands of offices, slash service and layoff over 100,000 workers. the postal service is recording financial losses, but not for reasons you might think. the problem ? a burden no other agency or company bears. a 2006 law that drains $5 billion a year from post office revenue while the postal service is forced to overpay billions more into federal accounts. house bill 2309 is not the answer.

our third story "outfront." an exclusive "outfront" investigation, egregious neglect and abuse at afghanistan's main military hospital. a hospital that's backed by more than 100 million american taxpayer dollars.

pentagon component barbara starr has been looking into this story. and we want to warn you that some of the images that we're about to show you are difficult to watch. >> reporter: afghan soldiers, starving, lying in dirty beds with festering wounds, denied pain killers. all of this at the kabul national military hospital, a hospital the u.s. paid more than $100 million to help the afghans run. >> things as simple as dressing changes are not done. patients become infected and they die. >> reporter: these days, a world away, skylar gellar, a retired air force doctor, tends to his tennessee farm. >> this will be kind of a little haven. >> reporter: from february, 2010 to february, 201 1, he oversaw training of afghans at the hospital. these photos were taken by his american military staff. >> there are patients that are starving to death because they

can't buy the food. they have to bribe for food. they have to bribe for medicine. patients were beaten when they complained about no pain medicine or no medicine. >> reporter: and you're not supposed to worry about that. >> that's what we were told. >> reporter: pentagon officials do not dispute that the photos from 2010 show hidden, but deliberate abuse by afghan staff. but they insist that after a u.s. inspection, conditions have improved significantly. in this memo to congress, gellar alleges, two senior u.s. engines engines who oversaw, the lieutenant and his deputy, in 2010, delayed bringing in pentagon investigators because of their political concerns over the looming midterm u.s. elections. gellar says caldwell was angry his staff wanted the inspector general to investigate.

and that patton ordered a delay out of concern it would embarrass the obama white house. >> and then he said, but we don't want to do -- we don't want to put that request in right now, because there is an upcoming general election. and we wouldn't want this to leak out. >> that's just not acceptable. >> reporter: congressman jason chafe et cetera' house subcommittee is investigating the general's behavior. >> that's a very serious allegation. but it didn't come from just one high-ranking military official on the ground, not just two. we have several who have stepped forward and said yes, this was indeed the case. >> reporter: gellar says he wants the truth to come out. >> the biggest frustration is our own leadership's response, and how slow that was and how inadequate that was.

>> barbara starr is with me now. barbara, those pictures were awful to look at. what has the response been to the allegations? >> reporter: well, erin, i don't think it's going to be a surprise. spokesmen for neither general would offer a comment. neither man is commenting, because of the new review now going on at the pentagon about these allegations. far, there's no indication the white house knew anything about any of this. and the pentagon still insists, things are getting better. >> so they're insisting things are getting better. what is congress saying to you? >> reporter: well, next week, there will now be the first hearing about all of this, looking into what happened at the hospital, the allegations about it, and what may happen now. dr. gellar's point is, he wants to know how this all happened. it's fine it's getting better, perhaps, but how did it even happen in the first place? erin? >> a lot of people are asking that tonight. thanks very much to barbara starr. outfront next, mcdonald's

says it's offering healthy options at the summer olympics. but does it add up? and scott peterson was sentenced to death for the murders of his wife and unborn son. but now he's appealing that sentence. why paul callan thinks he might win. fit briefs for charity to prove how great the fit is even while playing pro football. the best protection now looks, fits and feels just like underwear. get a free sample and try one on for yourself. this is new york state. we built the first railway, the first trade route to the west, the greatest empires. then, some said, we lost our edge. well today, there's a new new york state. one that's working to attract businesses and create jobs. a place where innovation meets determination... and businesses lead the world. the new new york works for business. find out how it can work for yours at thenewny.com. scroll...

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we start the second half of our show with stories we care about, where we focus on our own reporting from the front lines. george zimmerman walked out of a

florida jail this afternoon after posting $1 million bond. it comes after zimmerman's legal team announced today that it received $20,000 in donations since yesterday, which was when the judge set zimmerman's bond at $1 million and set a number of restrictions, including curfew and electronic monitoring. zimmerman is charged with the murder of 17-year-old trayvon martin. benjamin crump, an attorney for the martin family, said he preferred zimmerman stay in jail but respected the judge's ruling. the world health organization is struggling to find out what illness is killing children in cambodia. at least 61 children have died from a mystery disease affectinging mostly children below the age of 3. initial symptoms are high fever, respiratory issues, and then inflammation of the brain. we have learned that initial tests have ruled out h1n1, sars and nepa. president obama signed legislation that prevents student loan interest rates from doubling. rates on federal subsidized stafford loans will stay at 3.4%

until next year. the white house estimates the move will save the average student $1,000 in debt. but we looked at the numbers in a recent report from the new york fed which found the average student has $23,000 in debt. so the $1,000 savings is less than 5% of a student's total debt. we found an example of the struggle with student loans. elizabeth got told "outfront" she is selling a valuable baseball to pay off her son's nearly $200,000 in student loans. lou gehrig hit this ball for a home run in the 1928 world series. it's been in the family ever since. she said she reached a point to sell it to help her son pay for medical school. online bids are currently around $30,000 and a live auction is on tuesday. hunt auctions estimates the ball could go for between 100 and $200,000. tomas lopez, the florida lifeguard fired for saving a swimmer will be honored next week. "outfront" learned the city of hallendale beach will present lopez with a key to the city

monday. he's 21 years old, and as you're probably aware, he was fired for leaving his post to help save someone who was outside of his zone. his boss, jeff ellis, offered lopez his job back on "outfront" last night. he declined, saying he's going to move on and focus on school. ellis is reviewing his company's policy that led to the firing. it's been 337 days since the u.s. lost its top credit rating. what are we doing to get it back? as we told you earlier, the jobs market is still struggling. only 80,000 jobs added in june. the unemployment rate stayed flat at 8.2%. and now our fourth story "outfront." mcdonald's. not loving it. that's the message from someone some london lawmakers who want to ban the company, among others, from sponsoring the olympic games. you may remember a few weeks ago, we pointed out what we saw as an irony, that mcdonald's is building its biggest restaurant in the world in olympic park. in fact, mcdonald's will be the

only branded food available in olympic park during the olympics. mcdonald's told me they were, quote, surprised and disappointed with my comments. mcdonald's wrote me they provide, quote, choice and variety on our menu with items like grilled chicken, yogurt, oatmeal, fruit, salad, smoothies and wraps, and, of course, we're proud of our iconic burgers. we know mcdonald's has tried to be healthier, they useca nola oil now and banned transfats. but we wanted to know if it claims of health added up. so we did this. assume i'm a reporter going to the olympics and i'm working really hard during those 17 days. during that time, i'm in olympic park, on the run, eating mcdonald's. we put together a menu and tried to make healthy choices. oatmeal, a small iced coffee and large oj for breakfast. calorie count, 710. lunch suggested by mcdonald's pr, a side salad, small mango pineapple smoothie and chicken snack wrap. calorie count, 580. and a dinner that includes what

i love when i go to mcdonald's, big mac, medium fries and soda and shake for dessert. calorie count, 1,710. obviously, that's the big whammer, and that's your rda or just before your rda for the entire day. the grand total for that day, though, is 3,000 calories. that's 76% more than the usda recommends. put it another way. 3,000 calories, 79 teaspoons of sugar, three times the daily recommendation. six teaspoons of shortening, like you get out of a crisco container, and 10.4 packets of salt, almost twice what the american heart association recommends. we sent this analysis off to two expert nutritionists to find out if they agreed, and they did, and went a little bit further. they said on this hypothetical diet, i would gain six pounds in the 17 days of the olympics. obviously, if you do the math, over a year, if i ate that every day, it would get boring to eat the same thing every day, but it would be 136 pounds. still, without mcdonald's, coke and hein kin, the only food

providers, the olympic games wouldn't exist. and mcdonald's says they're sending 200 kids and families, for example, to see the olympics. joining us on the phone, jenny jones of the green party and member of the london city council sponsored legislation to ban mcdonald's and coke from sponsoring the games, and kathryn manguward. jenny, let me start with you. obviously, it's too too late to ban these guys from sponsoring the olympics. why did you decide to do it now? >> what we really want to do is have the mayor of london, the british government and, of course, the london organizing committee for the games to actually recommend in their post games briefing that sponsors such as mcdonald's and coca-cola really should not have any links with such a sporting event that's basically about supreme athleticism, supreme fitness, they are promoting terrible junk food.

>> kathryn, let me ask a question. i know there's olympic athletes who say i love eating mcdonald's. but those numbers we showed are pretty troubling. and more so to have that be the exclusive food available at the ultimate sporting event on earth. >> you know, it's clearly a weird circumstance here, where it's the only food available in the olympic park. but this debate is really about, you know, is it mcdonald's fault that we're fat? and, you know, the fact is, everywhere else in the world, all the time, you would have to make a pretty weird choice to eat that diet two days in a row, much less 17 days. there are always other options. this is about personal responsibility. big macs do not have a strange hypnotic effect that causes you to have to eat them forever until you're 10 million pounds. >> i might disagree, because i love eating them. but i get your point. but you do -- you do admit, there is an issue, or something about having this be the only food you can get is mcdonald's at the olympics.

>> you know, i think it's actually a pretty small tradeoff for what mcdonald's is doing here, which i think should be getting them karma points, should be getting them credit. they're promoting exercise, which is at least as important as calories in, calories out. go swimming, do a cart wheel. >> you cannot possibly interject it, that's complete nonsense. mcdonald's actually promotes eat highly processed, high-fat, sugar salt, chemical junk food and make it absolutely tasty, so people keep coming back. they absolutely don't give you the full story on all this. and quite honestly, britain could have had the olympics without coca-cola and mcdonald's as sponsors. we actually didn't need them. and it's utterly depressing to think that children in britain who are already becoming obese and their parents are becoming obese, are going to have to put up with endless ads on television. seeing these companies that they have no interest in our health. they only have interest in their profits.

>> and jenny, you're saying -- i just want to make sure one thing you're saying is different than what the olympic committee says. you're saying they could have done without -- it's nearly $1 billion from these few key sponsors, one of which is mcdonald's. you're saying they could have put the games on without them? >> we absolutely didn't need that money. in fact, it's nearly $2 billion -- it's 2 billion pounds. although in fact we here in britain only get a third of the business. so we get a sixth of the money. so the race is raised in taxpayers and people who are paying for their tickets. we could have done it without them. and we could have done it perhaps with a little less glitz, a little less dazzle. but we could have done it, so they were not necessary. the advertising they're getting for their paltry donations, i think, is phenomenal. and the iocu should be embarrassed at being linked to these companies. >> daggett kathryn, do you think there will be change on the future now that there is more focus on healthy eating and better choices? >> i frankly would rather have a billion dollars from mcdonald's than a billion dollars from

taxpayers. this is money freely given, presumably by a company that believes in the importance of the olympics. i don't see any reason not to slap a couple of golden arches somewhere and, you know, again, i think it's very, very important to emphasize here, seeing a mcdonald's logo does not somehow automatically result in high fructose corn syrup flooding into your veins. you still have to buy the burger, you have to choose it. burgers are delicious, swimming is fun, why not have both? >> thanks very much to both of you. we appreciate it. and please, everybody, take to twitter and let us know what you think about this. you remember this man. scott peterson. convicted eight years ago and sentenced to death for murdering his pregnant wife, laci and dumping her body into the bay. it was intense, to say the least, media coverage. and now there is a chance peterson could be spared the death penalty. his attorney is claiming overwhelming publicity, errors and other mistakes deprived

peterson of a fair trial. "outfront" tonight, paul callan. so do you think there is -- there is something here? that this appeal could work for them? >> there is a great chance that the death penalty will not be imposed in this case and it will be reversed. and i say that, because a., his attorneys made a compelling case. 423-page brief outlining prejudice that occurred during the trial. but the bigger issue is, california courts and the federal court out there, are very liberal on death penalty issues. i mean, frankly, the death penalty hasn't been imposed in california since 2006. >> right. and that was -- that brings me to that -- there's 725 inmates on death row in california right now. scott peterson being one of them. so i mean, is there something to be said for would his turn have come up anyway? >> well, i don't know. try to pick you are at your the carnage if the california courts say we're now going to start imposing the death penalty. are they really going to put

over 700 people to death? the federal court that he's going to wind up in is the ninth circuit court of appeals. >> oh -- >> which -- >> famous or infamous, depending on your point of view. >> that's right. no god and pledge of allegiance and things people have criticized. my point is, regardless of the merits, whether he deserved to be convicted or not, this is a jurisdiction where i think it's unlikely you're going to see the death penalty imposed. >> okay. so presume then he wins that appeal. what happens then? does that change his sentence, just becomes life in prison or could the entire sentence itself be up for discussion? >> well, there are really three possibilities. one possibility is that the death penalty just gets thrown out. he would then default back to what would have been the sentence, which would be life without parole. the other possibility, of course, the court could look at this and say you know something, he was deprived of a fair trial. one of the claims is that 93% of the jurors in the jury pool had a strong opinion about guilt or innocence and yet were allowed to serve on the jury.

new trial could be ordered in that scenario. and you know, this was a shaky case. there was a lot of motive -- remember, he was having an affair. >> right. >> it was a horrific case. but the actual physical evidence linking him -- >> they never found -- >> minimal. he could -- a new trial would be a possibility years later. you never know what might happen on that scenario. so my point is, maybe he doesn't get the death penalty. and there's at least the possibility of a new trial. >> well, paul callan, thank you very much. 25 years after its original run, my little pony is back on the air, and this time it is not just for little girls. and airlines keep cutting costs to keep airfares down. but are those cuts putting all of us in danger? ttd#: 1-800-345-2550 let's talk about market volatility. ttd#: 1-800-345-2550 in times like these, it can be tough to know which ttd#: 1-800-345-2550 way the wind is blowing. ttd#: 1-800-345-2550 at charles schwab, we're ready with objective insights about ttd#: 1-800-345-2550 the present market and economic conditions. ttd#: 1-800-345-2550 and can help turn those insights into

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i tell mike what i can spend. i do my best to make that work. we're driving safely. and sue saved money on brakes. now that's personal pricing. as children of one generation start having kids of their own, toy makers often re-release vintage toys to capitalize on nostalgia. that's why we've seen toys return, characters from the 1980s. you can see, my favorite, strawberry short cake. ask then there's this one, tonight's number, 1987, which is the year the tv show "my little pony" went off the air, 25 years ago almost. but the ponies are back. the second season, "friendship is magic" just haired on the tv network. the main character is sparkle sent to the town of poniville to

it is very popular. last weekend, more than 4,000 fans at the show gathered for a "my little pony" convention. it was a huge event with panels, galleries and a giant merchandise area. and the most unusual part of this, everyone, was that most of the attendees were male. it's true. one of the fastest-growing segments of the "my little pony" audience is men. they call themselves bronies as in bros who like ponies. get it? this weekend at brony-con, it was a diverse group. one guy was in the navy, another from canada, one guy hopes to write for television. so we asked, why do you love my little pony? and almost every single one said i love the story. stories like the time apple jack tried to tackle the entire harvest alone. and sure, we know some of you are saying guys who like my

little pony? yeah, they do. and we celebrate people who have enthusiasm and passion for something. besides, it might be good if there was a little brony in us all. i love that pony. and now to tonight's outer circle where we reach out to our sources around the world. we begin tonight in britain where police announce today they arrested seven men on terror charges, bringing the total number of terror arrests in the uk this week to 13. police are calling it the largest peace time operation in history with three weeks left before london kicks off the summer olympics. matthew chance is in london and i asked him about the rise in suspected terror activity. >> reporter: erin, there does appear to be an upswing in the level of vigilance in britain as the country prepares to stay the 2012 olympics. seven men arrested today after weapons were found hidden in a car. items recovered from the car say police are undergoing forensic analysis, and searches being carried out at the addresses of

those in custody. earlier on thursday, police arrested another six people. this time in london. suspected of terrorism offenses. those arrests relate to a possible plot involving islamist extremists with potential uk targets. neither is linked to the olympics. but it's understood, security services are doing everything they can responding to every credible threat to make the games secure. erin. >> thanks to matthew chance. now we go to libya, where the first elections since the overthrow of moammar cadaver will be held tomorrow. the national congress will apoints a new government and draft a new constitution. jomana car achez in tripoli, i asked her what issues are most important to voters. >> reporter: ear erin, the biggest concern election day will be security especially in benghazi where a small but vocal group of federalists have been calling for a boycott of the vote and demanding more representation in the national congress.

their protests turned violent at times this week. for decades, the eastern part of the country, the city of benghazi, was marginalized by moammar gadhafi and many feel yet again they're being marginalized and sidelined by the government here in tripoli. all eyes will be on the east tomorrow, on the city of benghazi, where the majority of people are saying they're going to go out and vote and will not let anyone disrupt their big day. erin? >> thanks. all right, our fifth story out front. when flights are fuller than ever, the airline industry relies on regional carriers to fly half of its routes and outsources 71% of its maintenance. are the airlines cutting corners at the cost of safety and is anybody watching over them? out front tonight, william mcgee, author of attention all passengers, a former consumer advocate at the u.s. department of transportation. appreciate you taking the time to come and talk to us.

where are they cutting corners, according to the research that you've done? >> well, we all see it when we see things like checked baggage and paying for pillows and cokes and window seats. what i'm much more concerned about is cutting corners behind the scenes. particularly with maintenance. we have seen an epidemic of outsourcing of maintenance in the airline industry over the last ten years. in some cases, in the united states, in many cases overseas, el salvador, singapore, china, mexico. big concern is the faa providing proper level of oversight. >> i want to give they are response to this and get your response to them. we asked them about this, on maintenance, and they said, faa standards are the same no matter where the maintenance is performed. the faa conducts at least one comprehensive in depth inspection annually. and a facility could lose its certificate if it doesn't comply with faa requirements. that's what they say. is that what they do? >> unfortunately i've had this conversation before with senior faa officials. what we found is that in fact in reality there are often two standards. for one thing, mechanics in the

united states are required to undergo security background checks, alcohol and drug screening, in many cases, it is not the same thing overseas. in addition, what we have seen is that traditionally the airline model requires all mechanics to be licensed by the faa. what we have seen in recent years is that in many of the outsourced shops, they have unlicensed mechanics. now, according to the faa, that's okay, they say as long as one licensed mechanic signs the log book and says they did a good job -- >> doesn't matter who did the work on the engine. >> the average person would say how you can ten unlicensed people do the same work as ten licensed people. the faa says as long as the certification is the same and somebody is swearing it was done right, it is fine with us. >> i can understand why a lot of people would feel nervous hearing that. let me ask you about this. there is other specific things that happen. people try to save money when they fly, so there is always people have the conversation, if my child is under 2 or 3, can i hold them in my lap? if not, you have to pay full

fare, some discounts are available, but basically full fare. you say that's another problem. >> absolutely. for more than 20 years now, the national transportation safety board has said to the faa, please, ban lap children. but right now there is a loophole. there has been forever. basically all passengers over the age of 2 are required to be restrained. those under 2, it is up to whoever is traveling with them. when i was -- when my son was young, i was guilty of this too. i didn't know it. there is a huge education gap on this topic. so two years ago when i was on the dot panel, i convened a panel of experts, asked them all, is there any case in which a lap child is as safe or safer than a child in a restraint? the answer came back, no, unanimously no. and yet -- >> you could hit a pocket, we hear about huge air turbulence pockets and a child could die. >> if an infant hits a bulkhead. what the faa, to its credit, the faa increased some education efforts in this area. the real answer is the same thing with cars.

in other words, every state in the union has a law that requires you to have a child restraint. unfortunately, the faa won't do it for the airlines. >> that brings me to something here, part of the reason the airlines are in this situation is that they have got to make money. and when you have to make money, you start charging for pillows and not hard to imagine you're cutting corners on other things that are much more serious than that. so is this an argument for we should be reregulating airlines or safety comes before profits. i know they say it doesn't. if they don't make money, they go bankrupt. they have to make money. >> i've been around this industry for 27 years. i worked in it before i started writing about it. i can tell you, erin, a few years ago, i would have thought no way we shouldn't reregulate. but now i say, the industry is not doing a good job policing itself. the faa is not providing adequate level of oversight in many cases. and we do need to have a national dialogue about this. we haven't really discussed the airline industry on a national level in 34 years since it was deregulated.

>> people come back to you and say, look, it is so safe, it is so safe, the record of flying in general is safe and in it country, the safest in the world. >> yes, it is safe. the people i'm talking to are on the front linelines. these are not my opinions. we have the world's most enviable airline system, but unfortunately in the last eight, nine, ten years, we have been cutting corners on standards, on training. >> you think it could be a huge cost, a catastrophic cost in. >> absolutely. this is what the faa inspectors on the front lines are telling me, they're not getting to the places where the work is being done. so now in many cases we're relying on the airlines to self-report. that's unprecedented in the airline industry. >> mitt romney is planning his first foreign tour. five countries made his list. we'll see how it stacks up against our list. with the spark miles card from capital one,

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so mitt romney is planning his first big foreign tour. reports say he'll visit five countries and three continents. reno, nevada, for a speech at the veterans of foreign wars. london england for the start of the olympics. meetings in israel and germany and poland. now there are a couple of things that i find a little strange about this plan. first, reno? i don't think you're allowed to include a city in your own country when you're planning a foreign tour so we're assuming they're going to add a country. the bottom line is this list is a little too old school.

since i love to travel, i have a list for you, mitt. this is a real list because it assumes limited time and it has you traveling consistently in one direction. i spent so much time planning trips, trust me on this one, mitt. so you're going to start in london, england, because i'm going to let you go to the olympics. you have a history with the games, you want to be there. that's one. after that, germany. i agree with you, they run europe, they're fighting with europe, europe is our biggest trading partner, that's a good move. from there, go to israel, sure, you know, you got to -- got to do that, kiss the ring. then go to the uae. it is america's biggest arab ally in the region. then china. now, yes, you've said you'll label them a currency manipulator but we know you don't really mean that. you have to go to china. it is the present, it is the future, and a big speech there for america is smart. china passed the u.s. as brazil's largest trading partner and that's why i make south america the fourth continent for your trip.