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ANDERSON COOPER 360 DEGREES

Child Sex Abuse Cover-up at Penn State?; New Allegations against Penn State Coach; Quake Hits Eastern Turkey; Dow Takes a Dive

Aired November 9, 2011 - 20:00   ET

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


ANDERSON COOPER, CNN ANCHOR: Good evening, everyone. Erin, thank you.

We begin tonight, "Keeping Them Honest" with major new developments in the child sex abuse scandal rocking Penn State University. That and questions, serious questions, about why so little was done for so long about the alleged rape of children, multiple abuse charges against a former assistant to the legendary coach Joe Paterno.

Today Paterno, who's coached the Nittany Lions since 1950 and been head coach for the last 46 years, announced his retirement.

This is new video of him today at a team practice for Saturday's Nebraska game. And that is part of the controversy. He said he's stepping down but not immediately, not until the end of the season.

In a statement today he said, and I quote, "I'm absolutely devastated by the developments in this case. I grieve for the children and their families, and I pray for their comfort and relief."

Paterno, who's the nearest thing to a secular saint in Pennsylvania and hero to his players, drew their praise today for his decision.

(BEGIN VIDEO CLIP)

ALEX BUTTERWORTH, SOPHOMORE PUNTER: I think as long as he's been here, he hasn't really ever made a wrong decision. He knows what he's doing. He's been doing it for so long. And if he thinks it's best for the program, chances are it's going to be the best thing for the program.

(END VIDEO CLIP)

COOPER: More and more, as you'll see, people have doubts about his decision now not to immediately step down. Here's former Penn State legend Matt Millen today on ESPN.

(BEGIN VIDEO CLIP)

MATT MILLEN, ESPN ANALYST: To be honest with you, and you can probably hear it, and I apologize to you, I get mad. It's -- it's pretty disturbing. It makes you sick. To see that this could happen to this level, if in fact it has happened, then -- you know, there's a part of me that, like I mentioned earlier, just viscerally, you just want to go take care of it yourself, which is what I've always done and which is the wrong thing to do.

But this is more than just a program. This is more than a football legacy. This is about people. And if we can't protect our kids, we as a society are pathetic.

(END VIDEO CLIP)

COOPER: Well, that's one criticism of his decision to stay on until the end of the season. The other even more so is the decision back then, nine years ago, when the coach first heard allegations from a graduate assistant that Paterno's former assistant coach, Jerry Sandusky, was in the team locker room raping a 10-year-old child in the locker room.

Sandusky is now charged with 40 counts of child sexual abuse involving eight minors over a 15-year time span. Until today he was featured on a massive mural on campus. Now he's gone, painted over by the artist replaced by an empty chair with a blue ribbon signifying child abuse prevention.

Jerry Sandusky founded and ran a program for at-risk children, the Second Mile, which he allegedly perverted, turning it into a place, according to authorities, for grooming young victims.

In his statement today, Joe Paterno said, quote, "This is a tragedy. It is one of the great sorrows of my life. With the benefit of hindsight, I wish I had done more."

And that's what troubles even some of his staunchest supporters. Paterno himself has said, talking about football, quote, "Throughout my life I've always had the ability to concentrate on what has to be done. If I can do something about it, I go after it and I try to get it done by giving it my best shot."

On field and off, Paterno has always preached doing the right thing, even if it's not easy.

(BEGIN VIDEO CLIP)

JOE PATERNO, PENN STATE HEAD FOOTBALL COACH: The thing that I feel strongly about, whether it's football, and you want to learn something, is you listen. That we -- you know, we've lost civility in this country. Nobody listens anymore.

(END VIDEO CLIP)

COOPER: Well, the suspicion for some of the outright allegations is that when it came to his former assistant's alleged abuses, he did not do the right thing, that he did not give it his best shot, that instead he did the bare minimum, that he kicked the can to his superior.

Questions, too, campus-wide for the school janitorial staff, especially the worker who says he saw Sandusky pin a young boy against a shower wall and perform oral sex on him. Somebody saw him do that.

Questions for the campus police and local district attorney who actually heard Sandusky confess to one alleged victim's mother that he hugged her son in the shower and say, according to a detective, quote, "I was wrong and I wish I were dead."

But you know what? That was back in 1998. Jerry Sandusky continued with the Second Mile until just last year. He was arrested on Saturday.

Years went by when people who could have done more instead seemed to do at best the bare minimum.

State officials say Joe Paterno is not a target of investigations in the Penn State's handling of the alleged abuse, but if you look at how Pennsylvania's statute on reporting suspected abuse is written, you'll see it potentially lets a lot of people off the hook.

It reads, quote, "A report is required when a person, who in the course of employment, occupation, or practice of a profession, comes into contact with children, has reasonable cause to suspect, on the basis of medical, professional, or other training and experience, that a child is a victim of sexual -- of child abuse."

The question is, what does that law mean? And does it let people who witness potential abuse off the hook?

The graduate assistant, by the way, who says he witnessed the alleged rape in 2002, he's now an assistant coach at Penn State.

In a moment, an expert on child sexual abuse. We'll also talk to Dr. Phil McGraw, former prosecutor Sunny Hostin and a former acquaintance of Jerry Sandusky's.

But first let's go to Jason Carroll live right now on the campus.

Jason, we understand there's an emergency Board of Trustees meeting happening right now. There's a lot of rumors the president of the university could be out as a result of this meeting. What are you hearing?

JASON CARROLL, CNN NATIONAL CORRESPONDENT: Well, Anderson, the next thing you're likely to hear a lot about is Graham Spanier, that is the president of Penn State. We are hearing a number of different reports, one report that Spanier has already submitted his letter of resignation, simply at this point waiting for the Board of Trustees to approve it.

Another report that, Anderson, it's not a done deal. I earlier spoke to a representative here at Penn State, here at the university. She told me that the only thing that she would confirm is that this emergency meeting is taking place and that Spanier's resignation is, quote, "under discussion." Anderson.

COOPER: You know, Jason, what's so incredible about this, and I've spent a lot of time today just reading the time line of these events and these allegations.

CARROLL: Yes.

COOPER: And I want for our viewers to get a sense of what that time line is so we put together a package to really give you a sense of when these allegations were said to have occurred and the response to them over time. Let's take a look.

(BEGIN VIDEO CLIP)

CARROLL (voice-over): The allegations of rape and sexual abuse by Jerry Sandusky stretch as far back as 1994, when he met his first alleged victim, a 10-year-old boy, through his charity for troubled youth, the Second Mile.

LINDA KELLY, PENNSYLVANIA ATTORNEY GENERAL: This is a case about a sexual predator accused of using his position within the community and the university to prey on numerous young boys for more than a decade.

CARROLL: And at least three times Sandusky's alleged abuse was seen by or reported to employees at Penn State.

In 1998, at this indoor practice facility, it's alleged that Sandusky inappropriately touched an 11-year-old boy in the shower. The boy's mother reported the incident to university police. That prompted an investigation by the university that included listening in on phone calls of the mother confronting Sandusky.

According to the grand jury report, Sandusky replied, "I was wrong. I wish I could get forgiveness. I know I won't get it from you. I wish I were dead."

Sandusky also admitted the incident to the Pennsylvania Department of Public Welfare, saying, "It was wrong." But despite that admission, no charges were filed and he was simply advised not to shower with children again.

UNIDENTIFIED MALE: Joe Paterno.

CARROLL: Despite being the onetime heir apparent to head coach Joe Paterno, Sandusky retired the year after this incident but maintained an office and access to university buildings as a professor emeritus at Penn State.

In 2000, at another athletic facility, a janitor allegedly saw Sandusky in the showers, quote, "with a young boy pinned up against the wall, performing oral sex on the boy." The janitor told his immediate supervisor what he saw, but neither man reported the incident to Penn State authorities or law enforcement.

Then in 2002, an alleged incident at the same athletic facility.

KELLY: Sandusky was seen committing a sexual assault on a young boy of about 10 years of age, was reported to university officials by a graduate assistant who happened to be in the building late one Friday evening.

CARROLL: That graduate assistant, Mike McQueary, reported the incident to Paterno. Exactly what he reported is in dispute.

Paterno said in a statement, "It was obvious that the witness was distraught over what he saw, but he at no time related to me the very specific actions contained in the grand jury report."

"The New York Times" reports that a person familiar with McQueary's version of the conversation said Paterno was given explicit details of the assault. Paterno's statement goes on to say, "Because Sandusky was already retired at that point, he referred the matter to university administrators."

Specifically, Timothy Curley, Penn State's athletic director. He and Gary Schultz, senior VP for Finance and Business, took away Sandusky's locker room keys and banned him from having children in the football building but never reported the incident to law enforcement or Child Protective Services.

KELLY: Their inaction likely allowed a child predator to continue to victimize children for many, many years.

CARROLL: In total, Sandusky faces 40 charges tied to sexual assault on eight boys. Curley and Schultz are charged with failing to report abuse and lying to a grand jury. Longtime Penn State president Graham Spanier is under mounting pressure to resign for his handling of the 2002 incident.

And 84-year-old Joe Paterno announced today he'll retire at the end of the season, saying in a statement, "This is a tragedy. It is one of the great sorrows of my life. With the benefit of hindsight, I wish I had done more."

(END VIDEOTAPE)

COOPER: Well, joining us now is Penn State alumnus Troy Craig, also Cory Giger of the "Altoona Mirror" newspaper and the local ESPN radio station. We're also joined by Robert Shoop, a professor at Kansas State University, author of "Sexual Exploitation in Schools," and former prosecutor Sunny Hostin, legal contributor for "In Session" on truTV.

Troy, you say Jerry Sandusky inappropriately touched you when you were just a preteen. What exactly did he do to you?

ROY CRAIG, PENN STATE ALUM, MET JERRY SANDUSKY THROUGH SECOND MILE CHARITY: His contact with me was usually limited to a hand on the thigh in a car ride. Yes, I got to go to a lot of -- a lot of places with Jerry, football games, standing on the sideline for football games, family picnics.

There was a period of about -- I'm thinking two to three years where if I was in the car alone with Jerry his hand would guaranteed be on my left thigh. It never veered into anything overtly sexual, but certainly enough to make me uncomfortable. COOPER: So even at the time it made you -- it felt weird to you, it made you uncomfortable.

CRAIG: Sure, yes. I mean, there was -- I experienced no touch like that, you know, from any other adult man in my life. I didn't know at the time, you know, exactly what about it made it so weird and strange. I just knew, you know, it wasn't, like, you know, the touch of another adult man in my family or --

COOPER: Would he say anything about it at the time?

CRAIG: -- family or -- no, no. It was -- his behavior would have been, you know, very nonchalant. It was all kind of in fun. And, you know, at the time, at that age, I just chalked it up to strange behavior. You know, it was just -- that was Jerry. He was just being weird.

COOPER: Do you know any other boys who were also touched by him?

CRAIG: I remember -- there might have been -- you know, it took a long time to mention anything to any of the other kids I knew that were spending time with Jerry, to ever really say anything. You know, you were hesitant to bring anything up because you didn't want to ruin the privileges that you had, at least that was, you know, in my case, anyway.

But I do seem to remember mentioning something to one of the older guys. He was maybe two or three years older than me and he seemed to have been around Jerry and his group of kids for a little longer than myself. And I seem to remember him kind of chalking it up to, yes, that's Jerry. He'll do that. You know, he's weird like that.

COOPER: Sunny, you used to prosecute sex crimes. What do you make of these allegations against this guy?

SUNNY HOSTIN, LEGAL CONTRIBUTOR, "IN SESSION" ON TRUTV: I mean, it's so classic. And I used to prosecute child sex crimes in particular and predators, child predators, groom their victims. And it usually does start with that sort of uncomfortable touching, and then the boundaries get pushed and pushed and pushed.

When I read the grand jury report, it just read as classic child sexual predators.

COOPER: Were you stunned, though? I mean just reading the details of a janitor witnessing something, this grad student at the time, you know, seeing a child being raped by him in the shower according to his testimony, and yet beyond telling an immediate supervisor or telling Paterno not intervening immediately or not going to police.

HOSTIN: I think people are so uncomfortable, Anderson, when they see something like that, something so upsetting, they get distraught, they don't know how to react. And I think the law has to catch up, because certainly there are professionals that have to report, medical professionals, educators like in this case. They have mandatory reporting requirements.

But so often there are people that just don't do the right thing. And I think everyone at Penn State from Joe Paterno to the administration, they all failed miserably. And I believe they had a duty to report this to law enforcement.

COOPER: Cory, you cover Penn State football as part of your beat. Just how angry are people over this?

CORY GIGER, SPORTS REPORTER, ALTOONA MIRROR NEWSPAPER: A lot of people are angry from what your last guest just said, because everyone here failed so miserably. If they would have taken care of this in 2002 and contacted the appropriate officials, they could have gotten an alleged sexual predator off the streets.

And to think that was nine years ago. How many more young boys has he potentially abused over the past nine years? And so, yes, Joe Paterno might be legally safe. He went to his superiors and told them what had happened. But from a moral standpoint, he failed miserably to live up to his obligations as a leader and as a great character and molder of young men.

And Joe Paterno is, as you said earlier in the piece, is a saint here. He should have acted much, much better in this situation.

COOPER: I mean, in one case they just suspended the guy's locker room privileges after one alleged incident.

Robert, you go around the country, you provide training to school staff about the right way to handle sex abuse allegations. In your opinion, what was so badly handled by Penn State? And what did they do so wrong here?

ROBERT SHOOP, PROFESSOR AT KANSAS STATE UNIVERSITY, AUTHOR, "SEXUAL EXPLOITATION IN SCHOOLS": Well, I think there's a wide variety of points we could address. But I think if you take what Mr. Paterno said today when he announced that he was going to retire, and he said every morning when I come to work the most important thing on my mind is what's best for Penn State.

And the question is, is what's best for Penn State also what's best for children and other people. And I think when an organization begins to think of itself as excluding others and on its own rules, then it begins to think survival and preserving its own integrity is not as important as just survival.

And I think that the first thing an organization has to do is say this is our code of ethics, this is what we believe, this is what a person believes we should do. Should you see someone who's violating this, you must report it.

I think the difference between a law that says you must and free will says you do whatever you want to do, but in between is a moral compass. And apparently this was something lacking on many people's part in this situation. COOPER: Cory, I mean, you cover, again, Penn State. I mean, is it something about the culture of wanting to be associated with the university, wanting to be associated with that team? You think that led people not to do much more than just tell one other person or tell their supervisor and then kind of leave it at that?

GIGER: They were trying to protect the football program. They were trying to protect Joe Paterno. Joe Paterno is protected at every -- at every turn here. He's a legend and an icon. The university does everything they possibly can if there might be a little bit of a slip-up or a PR blunder here or there. They'll do everything they can to protect Joe Paterno because of his iconic status.

And yes, clearly the officials here botched this thing from -- going back to 1998 because they were looking out for themselves, they were looking out for the university, and they were looking out for the football program.

Who was looking out for these children? And that's what's outrageous about this whole situation.

COOPER: And Sunny, two of the Penn State officials have been charged with not reporting the sexual assaults, which is required by law. That reporting requirement didn't go into effect until what -- until after the alleged abuse.

HOSTIN: Well, it was in effect in 2002. It was refined and strengthened in 2007. In 2002, the law was sort of murky and it basically said if a child comes to you then you should report. But the spirit of the law, Anderson, has always been very clear when it comes to mandatory reporting. You're supposed to.

COOPER: But is that a loophole that might -- make it possible for them to get off of this?

HOSTIN: I think that's what the defense is going to be here certainly, but the bottom line is, it is in direct confrontation to spirit of these reporting laws. If you know of child sexual abuse, you report it immediately.

COOPER: But, I mean, somebody like Paterno can say, well, look, I reported it to my supervisor or my superior. There's not a -- there wasn't a requirement to report it to police?

HOSTIN: No. And that's I think why the law --

COOPER: What I don't understand is --

HOSTIN: -- failed us as well.

COOPER: And even not reporting to police, but even following up. I mean, if I saw something and I report it to my supervisor, which I mean I would hope to think I would just report it to police, as well.

HOSTIN: Right.

COOPER: But you think I would follow -- I mean I would follow up every single day with that supervisor --

HOSTIN: To find out what happened.

COOPER: -- to find out what happened.

HOSTIN: I think that's where everyone is saying he is -- he failed morally. But I think he failed legally. Of course, the laws need to catch up, but again the spirit of the law is very clear. You see something, you say something. You report it especially if you are an educator. And I don't think that the loophole will hold here, and I think the attorney general agrees with me, which is why they brought these charges.

COOPER: I want to thank Cory Giger, Sunny Hostin, Troy Craig, Professor Shoop. All, thank you very much.

Let us know what you think. We're on Facebook, now on Google Plus. Follow me on Twitter @AndersonCooper. I'll be tweeting tonight.

More on the story next. Dr. Phil McGraw joins us. Not pulling any punches on this one.

(BEGIN VIDEO CLIP)

DR. PHIL MCGRAW, RELATIONSHIP COUNSELOR: When you have people in a position where they do have a voice, they do have power that know what's going on, even see what's going on, and they don't stop it, how do you go home and have dinner when you've walked past something like that and leave a child in harm's way?

(END VIDEO CLIP)

COOPER: Also tonight "Raw Politics." Senator Rand Paul saying President Obama is not interested in getting a budget deal from the Congressional Supercommittee. Says he's not interested in America's 401(k) accounts, only getting re-elected.

Is that true? We're "Keeping Them Honest."

First let's check in with Isha -- Isha.

ISHA SESAY, CNN ANCHOR: Anderson, breaking news tonight in eastern Turkey, where another earthquake has struck the same area hit just two weeks ago. This time a magnitude 5.7 aftershock. More than two dozen buildings have collapsed and more than 50 people are believed to be buried in the rubble.

The latest on the rescue efforts is just ahead. That and much more when 360 continues.

(COMMERCIAL BREAK)

COOPER: More now on the Penn State sex abuse scandal and the shockingly extensive time line of alleged assaults. So many alleged incidents over so many years, eight alleged victims. You heard a bit of it before the break. Almost every time these stories come to light, we learn about people who saw things but didn't act or didn't do enough or didn't even know the right questions to ask.

I talked about it earlier tonight with Dr. Phil McGraw.

(BEGIN VIDEOTAPE)

COOPER: Dr. Phil, I find this so stunning. And I guess the thing that shocks me most of all, one is used to hearing about, you know, depraved people doing horrible things, but the fact that numerous people actually witnessed Sandusky allegedly sexually assaulting these boys, raping these boys in a public space, in the shower room. But none of them stepped into stop the assault as they were actually talking place and didn't seem to really follow up beyond maybe an initial reporting to a supervisor and in one case to Paterno.

MCGRAW: Well, Anderson, that's really disturbing at a couple of levels. You know, one of the things we know about children that are molested is that they are groomed for this. And whether it's through intimidation or whatever it might be, they don't have a voice. They don't have the ability to step up and stop what's going on.

And when you have people in a position where they do have a voice, they do have power, that know what's going on, even see what's going on and they don't stop it, how do you go home and have dinner when you've walked past something like that and leave a child in harm's way?

And then when it does get reported and people don't act on it, it makes you wonder, OK, they've got one agenda and they're going to pursue that at the cost of whatever. And when you're throwing children under the bus, leaving them isolated and alone, that is just the most repugnant thing you can imagine.

COOPER: Before the break, we heard from a man who says that when he was an adolescent, Jerry Sandusky repeatedly placed his hand on his leg. This happened multiple times over several years. Other boys who were victimized by Sandusky say it began with similarly inappropriate touching.

And if the allegations are true, this guy sounds like a serial predator.

MCGRAW: Well, what we know, Anderson, is when you have a child molester, it is -- it is not atypical, it's not unusual at all for them to have 40 or 50 victims during their life. And they'll go until they've gotten caught and sometimes after they've been caught, and then released. So if you see someone like that with a child, you've got to assume that there may be dozens of other victims.

And so if you don't act, not only do you not help that child but you leave others in harm's way. And you wonder how many children were impacted after someone actually witnessed this and they were victimized because somebody didn't step up and do the right thing. And that is so institutionally inconsistent with Penn State and the message they put out. COOPER: It also, you know, puts a question mark unfortunately over a lot of good folks who are working with kids and kids in -- you know, in precarious situations, kids in need, kids who don't have access to a lot of resources. This is a guy who formed a charity which was supposed to help kids in need, and now you wonder was the whole idea of his charity so he could get access to vulnerable kids.

MCGRAW: Well, it may very well be. And here's the thing. And this is going to be very disturbing to talk about, but, look, we just need to talk about this. The truth is that stranger danger only comprises about 10 percent of the assaults that take place on children, sexual molestation.

In 90 percent of the circumstances, it is someone that is known to them. And let me tell you who can be the most dangerous. It's the -- it's the predator that understands that there is an at-risk child, maybe a single mother, maybe a mother and father that are both working and they're stressed, and so they step up and say, hey, let me lend a hand, let me help, let them be in my activity here or let me come and take care of them so that the sad fact is we have to look the hardest at those that reach out to impact our children.

And that's so tragic, because most of those people are just good folks that truly want to help. But embedded in that group are the predators, because they're the ones that reach out and offer what seems like help when, in fact, they're targeting your child. And that makes it real tough for a parent to know who to trust.

COOPER: Yes. So -- I mean what's your advice for parents on what they should be looking out for?

MCGRAW: Well, one of the things you've got to look out for, if somebody is coming and offering to be involved with your child and help your child, you need to do a background check on him. You need to know, don't just take the fact that they seem to be credible, that they tell a good game, that they have a seemingly credible organization. You need to take the time to really do a background check.

And if you've got somebody that is overly interested in your child and particularly if they know too much about their music, too much about their video games, too much about what interests those kids, if you've got a 40-year-old man who knows too much about what 5- and 6-year-old children are interested in and focused on, that's a warning sign.

If you've got someone that is too -- relating too much to a teen and focused on what they're turned on by, what they're interested in, what their passions are, that might just be somebody that really relates well to kids, but it may be somebody that has learned their currency in order that they can get next to them and create a bond of trust.

COOPER: Yes. Dr. Phil McGraw, appreciate it. Thanks.

MCGRAW: Anderson, thank you. (END VIDEOTAPE)

COOPER: We're going to continue to follow this story, obviously, this is just so disturbing.

Coming up still tonight, a massive earthquake rocking eastern Turkey, the second to hit the region in less than a month. Four people now known to be dead, dozens still trapped under the rubble. Twenty-five buildings have collapsed that we know about.

We'll have the very latest.

Also, the Dow takes another a dramatic fall as another Eurozone country heads for a possible bailout. We'll tell you what's being done to try to keep another European economy from crumbling.

And take a look. One gnarly ride. We'll show you a surfer who caught the perfect wave and set just an extraordinary record when we continue.

(COMMERCIAL BREAK)

COOPER: Breaking news tonight in eastern Turkey where they're reliving a nightmare that never really ended. Take a look. A magnitude 5.7 earthquake has struck the same area hit by a major quake just two weeks ago.

The powerful aftershock came just before 9:30 p.m. local time. Right now, there's at least 50 people buried in the rubble, 16 have been reportedly rescued. At least four are known to be dead.

Five hundred people in last month's quake. This is the last thing that Turkey needs. Joining me now from Istanbul is journalist Gul Tuysuz. What is the latest on the ground?

GUL TUYSUZ, JOURNALIST: The latest on the ground is that the rescue workers who had already been in the region because of the bigger earthquake that hit 2-1/2 weeks ago, the 7.2 magnitude earthquake have all gathered and are helping in the rescue efforts. So there is a lot of movement on the ground and a lot of people are being pulled out of the rubble very quickly, in fact.

COOPER: Is there a lot of heavy equipment? I mean, do they have the equipment they need at this point or is it -- yes, do they have the equipment they need?

TUYSUZ: Yes, they do. Everything had been brought in 2-1/2 weeks ago for the big earthquake. So they have everything that they need, but there are some planes that have been mobilized with aid, with tents, and with blankets because in Von it's a very, very cold right now. It's a very cold part of Turkey. They have taken off from Istanbul and Ankara and will be taking equipment and much needed supplies to the area.

COOPER: At least four people are known to have died, a number still known to be trapped, dozens are still knows to be trapped. Obviously, I assume officials are expecting the death toll to rise.

TUYSUZ: Officials aren't saying anything. They're being very cautious. Right now, the Turkish government crisis center has said that there are four casualties so far and they estimated that maybe about 50 people are still buried under the rubble. But with every minute, they're pulling out more people out from the rubble.

COOPER: We wish them best. Gul, appreciate it. Thanks very much. Let's get the latest on some of the other stories we're covering tonight. Isha Sesay is back with the "360 News and Business Bulletin" -- Isha.

ISHA SESAY, CNN CORRESPONDENT: Anderson, Wall Street stocks took a serious nose dive. The Dow is down more than 388 points at the close. The Nasdaq and S&P 500 fell more than 4 percent. The reason for that dramatic fall, growing worry over Italy's crumbling economy.

Today, President Giorgio Napolitano said Italy will adopt the series of austerity measures promised through the European Union. Prime Minister Silvio Berlusconi is expected to step down after the measures are approved.

Meantime, Greek Prime Minister George Papandreou was expected to announce his resignation today, but he didn't. He's being forced out to make room for a new coalition government in the face of that country's ongoing economic crisis and a second euro zone bailout.

Protests in London over increased tuition fees ended in arrests. Police said about 2,000 demonstrators planned to march from the University of London to the city's financial district after erecting a tent city in the famed Trafalgar Square. Police removed the tents and arrested about 20 protesters.

Anderson, a dolphin washed up on the Louisiana Gulf Coast has a new home in Florida tonight. Renamed for a quarterback, Drew Brees washed up near grand line sick. They nursed him back to health.

COOPER: That was a good story. We lost you. Now you're back. Isha, thanks.

Time now for tonight's video, Garrett McNamara took a record- riding wave in Portugal. He rode a 90-foot wave, Isha, the biggest ever surfed.

The place is called the Nazarei Canyon, a deep-water canyon fed by the swells of the Atlantic Ocean creating unusually big waves. Look at how big that is. Huge.

SESAY: Dude, that's just totally awesome.

COOPER: Sweetie.

SESAY: Come on. That wasn't a bad impression. Don't even hold out on me.

COOPER: What was that, like a British surfer dude? SESAY: It was good. Well, we surf.

COOPER: Look at that wave. That is crazy.

SESAY: Yes, that's crazy.

COOPER: That is just unbelievable.

SESAY: It's totally rad.

COOPER: Yes.

SESAY: OK, fine. I'm off to work on my impressions.

COOPER: All right. Still ahead on "360," big drama on Capitol Hill. Republican Senator Rand Paul accusing Democrats of refusing to talk about deficit reduction.

He says the president does not care about anything, but being re- elected. Democrats say they didn't walk out of talks. Try to get to the bottom of the controversy.

And the trial is over. We're finally going to hear from Dr. Conrad Murray himself and what he has to say about Michael Jackson, the patient he's convicted of killing when we return.

(COMMERCIAL BREAK)

COOPER: In politics, there was never much a meeting of minds between Democrats and Republicans these days especially on the issue of debt reduction, but the bipartisan "Super Committee" was supposed to be different -- both parties working together to find a solution.

Unfortunately, they can't even agree on what's going on in their meetings. Republican Rand Paul who's not a member of the "Super Committee" went on Fox News and Sean Hannity's radio show with what he considered a scoop that committee Democrats had walked out, refusing to negotiate.

(BEGIN VIDEO CLIP)

SENATOR RAND PAUL (R), KENTUCKY: "I have news straight from sources close to the "Super Committee" that the Democrats have walked away from the table and they're refusing to talk with the Republicans about a deal. They will not counter any offers and basically there's an impasse and it's starting to look like they don't want any deal at all."

(END VIDEO CLIP)

COOPER: Democrats, on the other hand, say they haven't walked away from anything and called Paul's statement, quote, "absolutely ridiculous." Earlier, I had a chance to speak with Senator Rand Paul about his controversial statements.

(BEGIN VIDEOTAPE) COOPER: Senator Paul, you said today that the Democrats on the "Super Committee" have walked away from the table or you'd heard they walked away from the table.

Our reporters on the Hill haven't heard that version of the events. The Democrats are flat out denying it. "National Journal" is quoting a Republican aide saying a Democratic senator suggested a time-out. That's not walking away. Are you sure they walked away?

PAUL: Well, you know, I get most of my information from watching Chuck Schumer on the Cable News Network, and it sounds like this morning he's saying that we won't negotiate and the negotiations are breaking down.

So I think it's probably safe to say that we are at an impasse. But, you know, they say the walls have ears. I think the walls also have whispers, and the whispers I'm hearing are that the Democrats have walked away from the table and they're unwilling to really try to honestly reach a compromise.

It's made me think, because I see the president always on the campaign trail now, and I see him really liking to beat up on a congress that's not doing anything. My suspicion is maybe the president doesn't want a deal, that maybe he sees his campaign to benefit by not having a deal.

COOPER: You actually said something similar to that earlier today on -- I think it was on Sean Hannity's program. It was a pretty bold statement of what you said. I want to play that for our viewers and ask you about it.

(BEGIN VIDEO CLIP)

PAUL: "I think the president's calculation here is that it helps his campaign not to have a deal. So I don't think he cares at all about what this will do to people's retirement accounts on November 23rd, 24th, if the stock market plummets, the president doesn't care about your retirement account. He cares only about his election and any deal will not be good for his election."

(END VIDEO CLIP)

COOPER: It's a pretty tough statement so say that the president doesn't care about people's 401(k)s. Do you really believe that?

PAUL: Well, you know, I suspect that we're getting to that point because everything is about his campaign now. I'll give you an example. If you wanted to work with me, would you call me stupid?

The president on the campaign trail is saying Republicans are too stupid to understand his jobs program so he's breaking it up into pieces. Yes, there's a stick and the carrot to diplomacy.

If he wants to work with us, he should call us and talk to us. We have actually parts of our jobs bill, which we introduced today, the Republicans' jobs bill that both sides could agree to. But do you think -- the rhetoric doesn't help. For him to call us too stupid to understand his plan isn't getting us any closer to a deal.

COOPER: The CBO report this week made it pretty clear a cuts- only approach is not going to get a job done. When you talk to a lot of Republicans, they won't even consider revenue increases though.

PAUL: Well, you know, a lot of people are talking about getting rid of loopholes and reductions. Precisely what the president wants. He's saying we won't compromise, and many reports are coming out from the "Super Committee." We have been.

COOPER: Do you think that's enough -- just getting --

PAUL: Plan after plan. You know, they've been meeting for two months, and Republicans have offered to close loopholes repeatedly. That is on the table.

But the Democrats are backing away from the table, and the word I got was late last evening walking away from the table and saying, you know, we don't have any more discussion now.

We're not going to counter that. They're just not coming towards us while we are trying to come towards them.

COOPER: And for you, you say that's all about politics on the Democratic side.

PAUL: I worry that it is. I mean, you've seen the president on the campaign trail. There's a lot of bashing of Republicans for being too stupid to understand his jobs plan. There's a lot of bashing of millionaires and billionaires and Republicans won't do anything with his jobs bill.

We have a jobs bill, too. If you're going to compromise, he needs to come look at our jobs bill. Call me up. I'm down the street from him. Call me up, I'm down the street from him. Call me up, sit down with me, and let's work out a compromise on a jobs bill and we can pass something.

He's not doing that. He's on the campaign trail all the time bashing us. He needs to be in Washington calling up -- doesn't have to be me, but it could be other Republican leaders.

He should sit down with Mitch McConnell. He should come over and sit down with John Kyle or other leaders and say this part of the jobs plan that I have, could you agree to this if we did this.

COOPER: But Tim Geithner --

PAUL: Instead it's all or nothing.

COOPER: Tim Geithner did that before going to Europe. He sat down with McConnell and according to reports, McConnell said essentially what you said, that Democrats don't really want to make a deal, that the president wants this stuff to fail. Geithner said no, that's not true, we've put forward a number of plans.

PAUL: Yes, but when you hear him on the campaign trail he says we won't pass his jobs plan. I mean, the vice president says we're responsible for rape and murder because we won't pass their jobs plan. That's the kind of rhetoric.

You know, people are saying we're not going to compromise, that inflammatory rhetoric gets us nowhere. I'm willing to have a reasonable discussion. I had a very good discussion with the president one-on-one and I personally said I would work with him.

I still stand by that. I will work with the president. I will work with him to find middle ground. But it doesn't help if he's calling us names on the campaign trail all the time.

COOPER: Senator Rand Paul, appreciate your time, sir. Thank you.

PAUL: Thank you.

(END VIDEOTAPE)

COOPER: Keep in mind you heard Senator Paul claimed that President Obama called Republicans stupid. I did some checking. We found actually no evidence that he's ever called them that.

However, in talking about his jobs plan and how Congress was now voting on it in pieces, the president did say, quote, "maybe they," quote, "the GOP, couldn't understand the whole thing all at once," unquote. No mention of the word stupid, though the implication is there.

Still ahead, new developments in the Herman Cain sexual harassment scandal, including information that contradicts Cain's claim that he don't remember ever meeting one of his accusers.

Also ahead, what Dr. Conrad Murray said about Michael Jackson as he waited for the jury to decide his fate.

And how could you break your hearts like that. That's right, America. All you voted our friend, Nancy Grace off "Dancing with the Stars" on the spot in "The Ridiculist."

(COMMERCIAL BREAK)

COOPER: Let's check back with Isha in the "360 Bulletin" -- Isha.

SESAY: Anderson, a new angle on one part of Herman Cain's latest accusers' story. After Sharon Bialek went public Monday accusing Cain of groping her 14 years ago, Cain said that he didn't remember meeting her and didn't recognize her name.

Now Chicago radio hosts tell CNN that she saw Bialek and Cain talking at a Tea Party event just last month. The radio host says she couldn't hear the conversation. Meanwhile, the attorney for another Cain accuser, Karen Kraushaar says there may be a joint press conference by several of the women. The attorney says so far they haven't made contact with the two women who stayed anonymous, but they hope they have the courage to come forward.

A new interview with Dr. Conrad Murray will air on the "Today" show tomorrow and Friday. Murray spoke with the show before he was convicted of involuntary manslaughter in Michael Jackson's death. In the interview, Murray maintained his innocence.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Is it your theory that he woke up and somehow in the two minutes you were gone injected himself, gave himself Lidocaine so he wouldn't feel the burn? I mean, is that your theory?

UNIDENTIFIED MALE: What do you think?

UNIDENTIFIED FEMALE: What do you think?

UNIDENTIFIED MALE: Something happened when I was not in that room.

UNIDENTIFIED FEMALE: So you believe it's Michael Jackson's fault that he died.

UNIDENTIFIED MALE: Nothing that I gave Michael should have ended his life.

(END VIDEO CLIP)

SESAY: And Eddie Murphy won't host the academy awards after all. The announcement came one day after the show's producer, Bret Ratliff, quit. Ratliff resigned over an anti-gay remark he made. Ratliff and Murphy work together in the new movie "Tower Heist." Anderson, I know you're devastated.

COOPER: I was actually interested in seeing Eddie Murphy do it. He hasn't done stand-up apparently in like 20 years or something.

SESAY: Really?

COOPER: Yes.

SESAY: Apparently "Tower Heist" is terrible.

COOPER: What, really?

SESAY: Apparently so. I'm going to go see "Puss N Boots" instead. The cartoon!

COOPER: I'm familiar. I just was surprised you would go see it.

SESAY: It's in 3D. I'm going to leave the now because I'm painting a terrible image of myself.

COOPER: All right. Isha thanks. Let's check in with Piers Morgan and see what's coming up on his show -- Piers.

PIERS MORGAN, HOST, CNN'S "PIERS MORGAN TONIGHT": I think "Tower Heist" is quite good, for the record.

COOPER: You're trying to book all the guests.

MORGAN: Exactly. That exchange was almost as awkward as my exchange with Ben Stiller, ironically.

Anyway, tonight we have an explosive interview with Jermaine Jackson, who, like most of the Jackson family, is very, very unhappy about Conrad Murray going public in his documentary and speaking, of course, in a way he never did during the trial. He said he's sickened by what is happening.

Also a member of the White House inner circle, the president's frustrations and his chances for re-election. A very interesting interview with one of his top people.

Plus, a candid and emotional chat with "Saturday Night Live" alumnus Darrell Hammond, the guy is known as a funny man, but a dark past that will shock everybody as he talks about his childhood abuse and how SML saved his life. So a busy show tonight, Anderson. Back to you.

COOPER: Piers, thanks very much. I look forward to it and I actually do look forward to seeing "Tower Heist." I do want to see it.

MORGAN: That's a good film.

COOPER: All right, Nancy Grace gets the boot from "Dancing with the Stars" and the judges and voters end up on "The Ridiculist."

(COMMERCIAL BREAK)

COOPER: Time now for the "Ridiculist." Tonight, we're adding the Dancing with the Stars" judges, the voters, basically, the entire system. Checks and balances on that show because somehow, and I don't know how, HLN's own Nancy Grace has gotten, as they say, the boot.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: On this eighth week of competition, the couple who will be eliminated just one week shy of the semifinals is -- Nancy and Tristan.

(END VIDEO CLIP)

COOPER: Yes. Came down to her versus Rob Kardashian. Rob is a the Kardashian who isn't Kim or the other one or that other one or those two younger two. Let's just say there is a somewhat loose definition of stars sometimes on "Dancing with the Stars."

So Nancy made it a full eight weeks in the competition, which is amazing. It is a heartbreaker to be sure. The very first week she mamboed into our hearts and then like a really tiny, super feisty dancing comet, she was gone.

But taking the loss gracefully, Nancy says she's happy to have made it as far as she did.

(BEGIN VIDEO CLIP)

NANCY GRACE, HOST, HLN'S "NANCY GRACE": I am so proud, but I really cannot take the credit. You know what, it's been all Tristan from the get-go.

(END VIDEO CLIP)

COOPER: That's very sweet, giving a little nod to her dancing partner, Tristan there. Here's what she had to say later in the evening about what the journey, for some reason they all call it a journey, meant to her.

(BEGIN VIDEO CLIP)

GRACE: The most important thing I'll take away is a new love in my heart, and that would be Tristan, because we -- don't get crazy -- we have worked together seven days a week for a long time now. And contrary to the way we were depicted, we -- I actually love Tristan very much. So I'm taking away a new best friend.

(END VIDEO CLIP)

COOPER: She really likes that Tristan. Nancy also thanked her fans and the people who voted for her every week.

(BEGIN VIDEO CLIP)

GRACE: Thank you for voting for us and for getting to know Tristan and hopefully you'll have many more seasons to know him. And I'll see you on the air.

(END VIDEO CLIP)

COOPER: Nancy, geez. Enough with the Tristan talk already. Tristan this, and Tristan that. Let's talk about you, Nancy, because I happen to think the "Dancing with the Stars" judges and the voters, the whole system failed and it failed miserably.

This verdict was wrong. You know, friends, I'm suddenly starting to understand why Nancy gets so fired up on her HLN show. Can we take a caller or something? No callers?

OK. All right, well, in any case, the verdict was wrong. Justice did not prevail, but in the end, I like to think in a way Nancy won. And you know what, we all won. Who would have thought we'd ever get a chance to see Nancy Grace do a cartwheel? Zowie. What other forum would lead to a nationwide debate on what exactly happened when Nancy had that wardrobe malfunction? I personally, I am going to miss Nancy emailing me every single week asking me to vote for her multiple times. True story. So, friends, even though in this case the justice system has failed, we still have to trust that it's the best system going on the "Ridiculist." That does it for us. We'll see you again at 10:00 p.m. Eastern tonight. Thanks for watching. Piers Morgan starts now.