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Obamacare Damage Control; Obamacare Contractor: Don't Blame Us; Fourteen-Year-Old Charged With Killing Teacher; Health Secretary On The Hot Seat; Dangerous Behavior at U.S. Nuclear Sites?; Baby Prince George Christened; Kennedy Cousin Murder Conviction Thrown Out

Aired October 23, 2013 - 17:00   ET

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

WOLF BLITZER, CNN ANCHOR: Jake, thanks very much. Happening now, the White House faces the challenge of repairing the Obamacare website. What can it do about repairing the president's image?

A 14-year-old boy charged with murder after a young math teacher is found dead in the woods behind her school.

And a day after America's spy chief denies intercepting millions of French phone calls, Germany says the U.S. may have been monitoring some the cell phone of its leader.

How awkward was today's phone call between President Obama and the German chancellor, Angela Merkel?

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

We'll have the latest developments, also, on the murder of a young Massachusetts teacher, police say, at the hands of a 14-year-old student. We have a correspondent, Don Lemon, on the scene. Stand by.

We'll also speak exclusively to a classmate of the alleged killer.

But, first, we want to take you to the White House, where there are now new developments on Obamacare and damage control. More than three weeks after launching the Web site, the administration is launching an urgent operation to try to fix it. It must also fix the damage the president has suffered in the rollout of his signature project.

The critics will take the spotlight tomorrow when the first GOP-led House hearing gets underway.

Our chief congressional correspondent, Dana Bash, is standing by.

But let's begin with our senior White House correspondent, Brianna Keilar.

She's over at the White House with the latest -- Brianna.

BRIANNA KEILAR, CNN CORRESPONDENT: Hi there, Wolf.

Well, a lot of tech experts suggest just razing HealthCare.gov and starting fresh.

I asked Jay Carney about that today. It was fascinating. He didn't rule it out, although right now the administration is focused on fixes of the current Web site. That includes increasing bandwidth, as well as making changes to the structure of the Web site and to the search database.

(BEGIN VIDEOTAPE)

KEILAR (voice-over): Rewriting 100 million lines of code -- that's what some experts think government contractors are facing as they try to fix health HealthCare.gov. Some suggest scrapping the entire site and trying again.

(on camera): Is that under consideration?

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: We have tech teams working on specific fixes to the existing system.

KEILAR: But that's...

CARNEY: So our belief is that we can -- we are -- we are making fixes to the existing system.

KEILAR (voice-over): The White House is not ruling out starting all over and not batting down experts' opinions that it could be several months before the federal Web site to purchase Obamacare is fully functional.

(on camera): Look at this. (INAUDIBLE) two years, that's a really long time.

CARNEY: Well, again, I would...

KEILAR: -- is that out of the realm of possibility?

CARNEY: Again, I don't -- what an outside computer expert might guesstimate about what the end of a process would look like is obviously based on a lot of assumption.

KEILAR (voice-over): The White House is in full damage control mode, as the federal portal to the president's signature health care reform program flounders, posting this new video on YouTube to show how everyday Americans were able to register or sign up for health insurance.

(BEGIN VIDEO CLIP, COURTESY YOUTUBE)

UNIDENTIFIED FEMALE: Down at the bottom of the page, there was a bar that said having trouble logging in. It told me to clear my browsing history, clear my cache and clear my cookies, whatever those were. It gave me the instructions on how to do it. And once I did that, I went back onto the computer and it sailed right straight through, no problems at all.

(END VIDEO CLIP) (END VIDEO TAPE)

KEILAR: Now if you're wondering about the people in that video, two of them signed up for insurance using their state Web sites, their state exchanges, which have fared better than HealthCare.gov, the federal Web site. The one person who did use HealthCare.gov, Wolf, we're told was able to register, but she hasn't completed the process.

BLITZER: Brianna Keilar at the White House.

Thanks very much.

All right, this just coming in to CNN. We're learning that a top contractor from the Obamacare Web site is saying basically don't blame us. That will be a highlight of tomorrow's House hearing, as Republicans pounce on the Web site fiasco and try to move the take advantage of the administration's political problems.

Democrats are worried, as well.

Our chief congressional correspondent, Dana Bash, is up on Capitol Hill.

And she's got new information that's just coming in -- first of all, Dana, what are you learning about what the contractors' testimony tomorrow is going to be?

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Well, four contractors will be represented at tomorrow's hearing in the morning. But one of them, CGI, which is -- which helped develop the software for the Obamacare Web site, has said -- is saying in testimony prepared for that hearing that they've had eight required technical reviews prior to going live on October 1st, and, also, that they followed a rigorous and formal process that is customary for such a large process like this.

The other thing that they are going to testify is that, unfortunately, in systems this complex, with so many concurrent users, it is not unusual to discover problems once a system goes live. So saying that they did what they needed to do. They passed all the tests they needed to pass, but you know what, sometimes with something this big, involving this many people, sometimes things don't go right.

And I think you can expect to hear from members in both parties. That's an understatement.

BLITZER: Yes, it certainly is.

All right, Dana.

The Democratic senator, Jeanne Shaheen, she sent a letter to President Obama, urging him to extend the deadline for the individual mandate, the requirement to purchase the health insurance.

Are you hearing from other Democrats on this sensitive subject? BASH: We are. And this is really indicative of just how sensitive this is, politically, especially for Democrats who are up for re- election next year, like Jeanne Shaheen.

Two other Democrats have formally said that they agree with her, that it's important to delay the enrollment deadline. One of them is Mark Begich of Alaska. The other Mark Pryor of Arkansas.

Not just that, Wolf. I spoke to -- just before coming on with you, a top Democratic strategist involved in trying to get Democrats elected to the Senate who said based on conversations with campaigns of targeted Democrats, to expect more of them to come out and endorse this idea, because they're being encouraged not just to sit back and wait to be asked by reporters or by constituents, but to be active -- proactive in saying that they think things need to be fixed and there needs to be fairness in there.

And one other thing beyond the 2014 clash of those running for re- election, another Democrat, Senator Joe Manchin, who's not up for re- election, but is somebody who's quite conservative as a Democrat. He is going to release or unveil legislation when the Senate comes back into session next week to delay that penalty or fee that people will have to pay if they don't get health care by next year. And that penalty is $95, or 1 percent of a family's income, whichever is greater.

He's going to say that should be delayed for a year.

So far, a spokesman for Manchin says that no other Democrats or Republicans are on that, but expect that could change, as well.

BLITZER: Yes. Bill Nelson of Florida issued a statement saying somebody should be fired. He didn't say who, but he did issue that statement.

What about Republicans?

What are they saying?

BASH: Republicans are very interesting. They are being encouraged by the House speaker, in a private meeting this morning, not to focus on this Web site, saying this Web site is likely to get fixed, that these problems and signing up are likely to get fixed, but to focus on the broader substantial issues that they believe occur and are out there with Obamacare. So that is what Republicans are being encouraged to do.

And probably we'll hear that, even though the hearing tomorrow morning is going to be really technical, focused on this Web site. Do not be surprised if you hear Republicans, and even some Democrats, but especially Republicans, use their opportunity, use the platform, as they're known to do, to talk more broadly about the Obamacare law.

BLITZER: I'm sure they will.

All right, Dana, thank you. So can the White House fix the damage to Obamacare and to the president of the United States?

He's now getting some help from the outside.

Our chief political analyst, Gloria Borger, is joining us now with some new information -- Gloria, what are you learning?

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Well, Denis McDonough, the White House chief of staff, Kathleen Sebelius, met today with insurance industry executives over at the White House. And the read that I got from the source in the room, Wolf, was very clear, which is that the White House said to them, look, we need to use your expertise, so please help us solve the problem.

I'm told that it was a really productive meeting, Wolf, that the White House took notes on what the insurance industry executives had to say. After all, they have a lot of experience in dealing with online users, with insurance, and that the industry came there and said, look, we're all very preoccupied with the front end of this, logging onto this, getting on. We need to also talk about the back end, because by the time the information gets to them, sometimes it's been muddled and unclear.

And so they're trying to work together to figure out a way to make sure that the information that is then given to the insurance companies is, in fact, accurate so they can sign people up more quickly.

Will they be able to do it within the next few weeks?

The answer is really uncertain.

BLITZER: It certainly is.

All right, listen to what the president said the other day, when the government reopened from the partial government shutdown.

Let me play this clip.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: And we hear all the time about how government is the problem. Well, it turns out we rely on it in a whole lot of ways. So let's work together to make government work better, instead of treating it like an enemy or purposely making it work worse.

(END VIDEO CLIP)

BLITZER: All right, Gloria. So folks are focusing on those words in the current context.

BORGER: Right.

BLITZER: What do you see? BORGER: Well, you know, talk about stepping on your own message, Wolf. After the government shutdown, public opinion of government was going up. Public opinion of Obamacare was going up. Then you have this Web site fiasco. And Republicans can now say, well, if the government can't manage a Web site, how is it going to be able to run your health care?

I think that is why the Republican House leadership doesn't want people to focus on the Web site per se, but they want to use it as a way to take a turn and say, look, government can't manage something this big.

And this has, of course, been the president's problem all along, dating back to the beginning of health care reform.

But it does give Republicans an opportunity to talk about health care unrelated to the government shutdown, to talk about the problems with it again and give them more credibility, because it's not attached to shutting down the government.

So this is a huge problem for the president going forward right now.

BLITZER: Yes. They're now at week four of all of this.

BORGER: Yes.

BLITZER: I know the administration is trying to get ahead of some of these problems.

BORGER: Yes, they are.

BLITZER: But there are lots of questions that will need answers.

BORGER: You know, they are. Look, Wolf, they are trying to change a tire on a car that's going 50 miles an hour.

It's not easy, right?

But the American public is asking questions. And they haven't been as transparent as they should have been. They're now saying they're going to brief journalists on this every day about the progress they're making.

But the public wants to know if there were glitches early on in the testing, why did they go ahead with this?

Why wasn't the president told about this?

They had -- they want to know why this happened. They want to know when it's going to end. And they want to know, as Dana was talking about earlier, are they going to get penalized if they don't get health insurance within the time frame we now have?

So I think the American public wants to get answers from an administration that has always said that it's very transparent. And they don't -- they haven't seen that yet. BLITZER: Yes, transparency is very important.

BORGER: Yes.

BLITZER: All right, Gloria, thank you.

Up next, did the U.S. spy on Germany's leader, Angela Merkel?

An embarrassing phone call today between President Obama and Chancellor Merkel. We'll have details.

And a bloody mystery in Massachusetts. A 14-year-old boy is now charged with the murder of a popular young teacher. Details coming up.

(COMMERCIAL BREAK)

BLITZER: To Danvers, Massachusetts now, and the first pictures we're getting of a 14-year-old student charged with murder after a young math teacher was found dead in the woods behind the school where she taught. The shocking incident forced seven schools in the suburban Boston town to close for the day as authorities attempt to get answers.

We'll have an interview with a classmate of the alleged killer in just a minute, but first, let's bring in CNN's Don Lemon. He's on the scene for us. He's getting new information. What happened here, Don? What are you learning?

DON LEMON, CNN CORRESPONDENT: Wolf, you said shocking. It truly is shocking. And the new information is just in the complaint here, the criminal complaint and the police report. And here's what it says, specifically. It says that a juvenile student that attends Danvers High School, which is right behind me, assaulted and subsequently murdered Colleen Ritzer (ph), that 24-year-old teacher, and disposed of her body near the high school grounds.

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: Philip Chism (ph) by way of arrest.

LEMON (voice-over): This is the face of an accused killer.

UNIDENTIFIED FEMALE: The defendant before the court is 14.

UNIDENTIFIED MALE: In fact that he's arraigned --

LEMON: Investigators in Massachusetts alleged 14-year-old Philip Chism (ph) killed opular 24-year-old math teacher, Colleen Ritzer (ph), at Danvers High School where she taught and where he was a student.

KYLE CAHILL, DANVERS HIGH SCHOOL: He's quiet, just kept to himself because he's was new to this society, but I mean, he's a good kid. He didn't seem anything bad, like nothing out of the ordinary, just a quiet, normal kid. LEMON: Students and family members say Ritzer loved being a teacher, at times, sending out homework assignments over Twitter, Facebook, and her blog.

UNIDENTIFIED MALE: Wonderful lady. Couldn't say enough about her. She was always the teacher to go the extra mile for students.

LEMON: So, why would anyone, let alone a student, want to kill her, allegedly dumping her body in the woods behind her own school?

UNIDENTIFIED FEMALE: I think that their sense of security starts to become shattered, you know, and they all just said this is Danvers. This is Danvers. It doesn't happen here.

LEMON: The discovery of Colleen Ritzer's (ph) body was a surprise sending to what started Tuesday night as a hunt for Chism, a high school soccer player who'd gone missing. Meanwhile, Ritzer's family had called police that night to say she was missing, too.

JONATHAN BLODGETT, DISTRICT ATTORNEY: As a result of that report, Danvers police initiated a search for the teacher and discovered blood in the second-floor bathroom at Danvers High School.

UNIDENTIFIED FEMALE: By such assault and beating did kill and murder such person.

LEMON: The teen was found in a nearby town on Tuesday. According to court documents, investigators learned from an interview with Chism and video surveillance at the school that he had assaulted and then murdered Ritzer. In an adult criminal court, the teen's attorney argued he should be treated as a juvenile.

UNIDENTIFIED FEMALE: In this case, the defendant wishes to have services to evaluate him. I think the case speaks for itself.

LEMON: That decision was not made today. He will be held without bail at a county jail facing a murder charge as a community struggles to answer the question why.

(END VIDEOTAPE)

LEMON (on-camera): And of course, today, they would not give a cause of death, and they don't know exactly why, only saying that they have to be very careful about what they're putting out because not much was entered into the record today and there was no bail set for today. But again, he will be tried as an adult, Wolf, and still they don't know why, but we are learning today that he was, indeed, a student in Ms. Ritzer's class.

BLITZER: Oh, he was one of her students, not just a student in the high school there. He was actually one of her students.

LEMON: He's one of her -- yes.

(CROSSTALK)

LEMON: -- to students who are in the school. They're saying he was definitely in her class, yes.

BLITZER: All right. Don Lemon on the scene for us in Massachusetts outside Boston. Don, thank you very, very much. And I was just reading through this statement, this criminal complaint, statement of facts. And based on his statements and the corroborating evidence found at multiple scenes at the Danvers High School and surrounding wooded area of the juvenile was subsequently placed into custody and booked for murder.

It was learned from an interview of the juvenile suspect and video surveillance, footage recovered at the scene, that the juvenile student that attends Danvers High School assaulted and subsequently murdered Colleen Ritzer (ph) and disposed of her body near the high school grounds. Those are statements coming from this statement of fact in this criminal complaint.

Joining us now is Ariana Edwards, a classmate of the alleged killer. Arianna, this must be so shocking for you and for everyone there. How are you doing, first of all? Are you OK?

ARIANA EDWARDS, CLASSMATE OF ALLEGED KILLER: Yes. I'm all right.

BLITZER: Now, did you know this young man?

EDWARDS: I'm just, like, shocked, obviously.

BLITZER: Like all of us.

EDWARDS: I didn't know him, like, personally, like that well, but he was in my English class, and he, like, worked with me on a group and projects. And, he just seemed, like, quiet and like reserved, but he seemed normal other than that. He made jokes still. If you talked to him, he would talk back to you, but he wouldn't really start conversations, like, often.

BLITZER: Did he have friends?

EDWARDS: He did have friends. He wasn't, like, too friendly, though. He, like, only had certain friends. He wasn't, like, outgoing to everyone. Like, in classes, he would only talk to, like, a select few people and he was new, too, so, like, he didn't have, like, the, like amount of friends as everyone else.

BLITZER: Now, he was a new student. He only moved to the area recently. Right?

EDWARDS: Yes, he did.

BLITZER: And so he was --

EDWARDS: He was from Tennessee.

BLITZER: He was a good athlete. He was on the JV soccer team, right?

EDWARDS: Right.

BLITZER: So, when you heard about this, what was your immediate reaction?

EDWARDS: Well, first I found out that he was missing and, like, this is last night, and I was, like, shocked by that, because I was, like, why would he go missing? Like, did he get kidnapped or did he run away? Everyone was, like, praying for him to find him. But then, once I found out that, like, in the morning, like, he was like -- there was like a homicide, I was like wondering who was connected.

So, that's the reason why we didn't have school because of a homicide, but then I was, like, really shocked that it was him-like I -- wouldn't have suspected it at all. I was, like -- like people say it's always the quiet ones, though, so, like, maybe that's why, like, it could have been, like if he had troubles at home or something. But he was nice. So, I didn't, like, suspected that much.

BLITZER: And Ariana, you saw him in class yesterday. Did everything seem normal?

EDWARDS: It really did. Everyone -- everything seemed, like, completely normal to me. I was, like -- he was, like, doing a project about (INAUDIBLE), and we were just, like, getting along fine, all talking to each other in our group, and he didn't seem like something was wrong with him or anything. Just seemed completely fine.

BLITZER: Did you know the teacher, Colleen Ritzer (ph)?

EDWARDS: I did not have her and I didn't know her well, but he acted like normal towards, like, our English teacher and everything, and nothing seemed like off about it.

BLITZER: I know your mom is there with you. What's it like in the area right now? How are folks reacting?

EDWARDS: People are, like, reacting like shocked, obviously, like this doesn't happen in Danvers, like it's, like, really, like, just surprising to everyone that's happening in our, like, small town and, like, that's something like this would happen here. Everyone is just, like, shocked and like we're all mourning the loss of a really great teacher. Everyone, like, loved her.

BLITZER: Ariana Edwards, good luck to you. Good luck to everyone over there. What a shocking story, indeed. Thank you so much for joining us and sharing some thoughts.

EDWARDS: You're welcome.

BLITZER: Coming up, the health secretary, Kathleen Sebelius, on the ropes over the Obamacare rollout mess. We're digging a closer look and how she got there. We're also going to hear from a former member of the Obama technology team on how to fix the mess.

Plus, Germany saying the U.S. may have been monitoring the cell phone of its leader. How embarrassing was today's phone call between President Obama and the chancellor, Angela Merkel?

(COMMERCIAL BREAK) BLITZER: As the administration goes into urgent damage control to try to salvage the Obamacare rollout, the health secretary, Kathleen Sebelius, is certainly on the hot seat right now. How did she get there? Brian Todd taking a closer look -- Brian.

BRIAN TODD, CNN CORRESPONDENT: Wolf, Kathleen Sebelius hitched her wagon to health care reform early on. It's seen as a big reason she got this job, and now, she's in the fight of her political career to keep it.

(BEGIN VIDEOTAPE)

TODD (voice-over): She says this is the most important work she's ever done in her life, but Kathleen Sebelius is on the ropes as she tries to carry it out. In an exclusive interview with CNN's Dr. Sanjay Gupta, President Obama's Health and Human Services secretary repeatedly dodged questions about the rollout of Obamacare.

UNIDENTIFIED MALE: How many people have signed up?

KATHLEEN SEBELIUS, HEALTH & HUMAN SERVICES SECRETARY: We'll be doing what we've done with every other program.

UNIDENTIFIED MALE: Would you consider resigning over this?

SEBELIUS: I think my job is to get this fully implemented and to get the website working right.

TODD: Sebelius certainly knows how to navigate tumultuous political waters. The daughter of a former Democratic governor of Ohio, daughter-in-law of a former Republican congressman from Kansas, and wife of a federal judge.

RON POLLACK, FAMILIES USA: I think she learned a great deal from that and I think it has served her very well.

TODD: this isn't her first health care battle. As governor of Kansas, Sebelius, a catholic, drew the wrath of the church for vetoing a restrictive anti-abortion bill, tried and failed to finace expanded health care coverage through cigarette taxes. As the state insurance commissioner, she fought to bring premiums down, but a critic says she drove insurers out of the state by regulating them too much.

VOICE OF TODD, TIAHRT, FORMER CONGRESSMAN, (R) KANSAS: They felt like they were in a position where it was not profitable to do business in Kansas. So, it limited our choices for health care providers.

TODD: Ron Pollack, a close ally, says Sebelius' focus was to help consumers above others.

With the pressure on her comes, I guess, a criticism of her management style, you know, how is she as a manager?

POLLACK: I think she's an extraordinary manager. She not only is smart and is very thoughtful, but she also has a listening style that I think is very important for this position. (END VIDEOTAPE)

TODD (on-camera): Pollack thinks Sebelius will survive all of this, but she has already lost a personal ally from the other side of the aisle. Kansas Republican senator, Pat Roberts, a longtime family friend, who actually worked for Sebelius' father-in-law was among the first in Congress to call for her resignation -- wolf

BLITZER: Brian, you've dug a little bit into why Roberts may have done that.

TODD: That's right. Now, Sebelius' allies said that Roberts did it because he's got a Tea Party-supported opponent in his primary for re- election, that he's playing to Tea Party voters in Kansas. Roberts' aides deny that that's the reason for him turning on her.

They say he's always been a staunch opponent of Obamacare and that the last straw for him was when she went on a public speaking tour after the rollout as one of the Roberts aides told me, quote, "as the ship was sinking," and that really did it for him. But that kind of gives you an insight into the political fight she's in in Washington and in her home state.

BLITZER: In her home state of Kansas. All right, Brian, thank you.

This just coming in to CNN, an Obamacare contractor says a last-minute change caused the problems, a lot of the problems with the health care Web site. Let's get some insight right now from Clay Johnson. He's the CEO of a firm called the department of better technology. He's a former member of the Obama technology team. Clay, thanks very much for coming in.

CLAY JOHNSON, CEO, DEPARTMENT OF BETTER TECHNOLOGY: It's great to be here. Thanks for having me.

BLITZER: This contractor says one of the problems was a late decision to force people to actually register, put all sorts of information in before they could go around and do some shopping, window shopping, as it's called for possible programs, possible packages. And that last- minute change caused this blunder in effect to happen. What do you make of that?

JOHNSON: Well, I think it's yet again evidence that the Department of Health and Human Services picked the wrong set of vendors to work on a project like this. I think any small business that's done professional services and technology is used to having clients that make last-minute decisions and develop technology that works around that. I think that CGI Federal really should have been able to hand that.

And when we have these debates over known how many lines of code are inside healthcare.gov, I mean, it's crazy because that's indicative of they're even measuring the wrong thing. Software that's written well should have less lines of code in it than software that's written poorly, which has lots of lines of code in it. BLITZER: You wrote this the other day, "Healthcare.gov got this way not because of incompetence or sloppiness of an individual vendor, but because of a deeply ingrained and malignant cancer that's eating away at the federal government's ability to provide effective online services." Explain what you mean by "a malignant cancer."

JOHNSON: Well, the way the government buys technology, otherwise known as procurement, is profoundly broken. What it does is it guarantees that the work goes to the people who have the best attorneys, not the people who have the best programmers. And I think if the Republicans in Congress were at the least bit interested in fiscal responsibility, they'd be worried about the billions of dollars that we spend going to large contractors to provide this sub-par work.

Ninety-six percent of I.T. projects in the federal government fail if they're greater than $10 million. That seems to me like a place to look for prudent fiscal responsibility.

BLITZER: Can the current Web site be fixed, or should they just throw it away and start from scratch?

JOHNSON: I sure hope so. I mean, I got --

BLITZER: You sure hope what? You hope what?

JOHNSON: I sure hope it can be fixed. I got a letter from Aetna just yesterday saying that my health insurance rates were going down by $300 a month because of the Affordable Care Act, and I sure would like to shop around on it.

I think it can be fixed. It's just going to take some time. But they've already, I think, made some good motions. They've brought in some presidential innovation fellows. I was a former presidential innovation fellow last year. Those guys know what they're doing, and I have a lot of confidence they'll be able to really shake this thing up.

BLITZER: The White House released a video today of what are called "real people" explaining their experiences with the Web site. Let me play a little clip.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Have patience with the system. You know, take your time.

UNIDENTIFIED FEMALE: Don't worry. You will get in. It's really easy.

UNIDENTIFIED FEMALE: It told me to clear my browsing history, clear my cache and clear my cookies, whatever those were. Gave me the instructions on how to do it, and once I did that I went back onto the computer. and it sailed right straight through, no problems at all.

(END VIDEO CLIP)

BLITZER: Now, those states that have their own Web site, they seem to be doing a lot better than the national system, if you will. Why is there this difference?

JOHNSON: Well, because of scale. You have 34 states that are not participating, that didn't build their own exchange. So, that means the federal government had to build an exchange for 34 states. That's a lot bigger of a number than that was I think originally anticipated when the Affordable care Act passed and when the dollars appropriated for this Web site were assigned. And so I think what happened is there are a lot more people that are using this Web site than were originally intended.

Now, do I think that, you know, if people clear the cache on their browsers and all the bugs in the Web site will go away? No. I think the contractors here did a sloppy job. I think every time they try to defend themselves, they come up with another excuse that actually provides more evidence that they don't actually understand what it is that they're doing.

And, you know, I would like to see them replaced with people who know what they're doing who can work at a fraction of the cost. If you look at healthcare.gov the front page and all that stuff before apply now -- before you click on the button that says apply now, that all works fine. But that wasn't built by the contractors who built the sort of exchange part of the Web site, which is really too bad.

BLITZER: Too bad indeed. Clay Johnson, thanks very much.

JOHNSON: It was great to be here. Thanks, Wolf.

BLITZER: Just ahead, a potentially dangerous lapse at a U.S. nuclear missile launch center. And it isn't the first.

And the German chancellor's uncomfortable conversation with President Obama today about whether the United States has been tapping her cell phone.

(COMMERCIAL BREAK)

BLITZER: An angry U.S. ally calls President Obama. Did the U.S. monitor the cell phone calls of the German chancellor, Angela Merkel? That's coming up.

(COMMERCIAL BREAK)

BLITZER: Talk about awkward and embarrassing. Germany's leader called the White House to find out if U.S. intelligence has been listening in on her cell phone. Let's bring in our chief national security correspondent. Jim Scuitto joining us from Washington. What are you hearing from your sources about this very sensitive story?

JIM SCUITTO, CNN NATIONAL SECURITY CORRESPONDENT: Well, Wolf, it's serious enough that the German chancellor Merkel called President Obama personally to raise this issue. We're told by the White House he assured her the U.S. is not monitoring and will not monitor her communications. The White House interestingly, though, did not specify if such monitoring had not taken place in the past. As with other cases like this with U.S. allies, the White House makes a point that other countries spy on the U.S. This is just how things are done. But officials also go on to say that they are reviewing the policy to get a better balance between security concerns and privacy concerns.

BLITZER: You know, Jim, this is obviously damaging. There's been a whole series of allegations, not only involving Germany but France, Mexico. This is a key relationship, though, a personal relationship between the president of the United States and the German chancellor, Angela Merkel.

SCUITTO: No question. Clearly a problem. As you mention, it's affected virtually all of our close allies -- Germany, France, the UK, Brazil. It is partly a public relations problem. There's been tremendous public outrage in these countries when these revelations have happened.

But it also has to be an issue for those relationships with the leaders. The German chancellor does not call the American president unless it's an issue. When we were at the U.N. General Assembly in New York a couple weeks ago, you'll remember that the Brazilian president made this monitoring, this subject of her address to the General Assembly. That doesn't happen if it's not an issue.

It is true that countries spy on each other. It may be in this case simply that what the NSA did is on a different scale, so widespread that it has become at least something of an issue with the U.S. and even some of its closest countries -- closest allies.

BLITZER: Yes, it's a sensitive, sensitive subject. I don't think it's going to go away. Thanks very much, Jim Sciutto reporting.

When we come back, a potentially dangerous lapse at a U.S. nuclear missile launch center. It isn't the first time.

Plus, a major warning for dog and cat owners after hundreds of deaths and illnesses from pet treats. We're going to tell you what you need to know.

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BLITZER: A major warning for cat and dog owners after hundreds of deaths and illnesses from some pet treats. We'll tell you what you need to know. That's just ahead.

But first, CNN's Michaela Pereira with this "Impact Your World."

(BEGIN VIDEOTAPE)

MICHAELA PEREIRA, ANCHOR, CNN'S "NEW DAY" (voice-over): It is a day of celebration at a village in Cambodia. Oscar-winning actress Susan Sarandon and her daughter have come to watch one of Heffer International's core programs in action.

SUSAN SARANDON, ACTRESS: Heffer International figured a very efficient way to spend your money by having you sponsor an animal for a family that they then help for a year to make sure that they understand how to nurture that animal. And when that animal has offspring, they pass that on.

The feeling of pride and satisfaction of being able to pass on something as valuable as that gift to another person is as important as filling their bellies.

PEREIRA: Heffer believes empowering women is the key to ending world hunger and poverty.

SARANDON: The families that I was fortunate enough to visit in Cambodia. It's certainly a testament to the power of women. They are the glue, the bonds, the community together. It showed me just how much we can accomplish when as women we recognize our ability, our voice, and the fact that we can pull together to create some kind of change.

(END VIDEOTAPE)

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BLITZER: Once again, the U.S. Air Force is dealing with sloppy and potentially dangerous behavior by its nuclear weapons units. The latest involving crews at an underground missile silos.

Our Pentagon correspondent Barbara Starr is joining us with details.

Barbara, this certainly isn't the first time. But what happened this time?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, this time another embarrassment for the Air Force, Wolf. Let me take you right to the map and show you where this happened. One location was Minot, North Dakota, the other location Malmstrom Air Force Base in Montana.

These are nuclear weapons facilities at both locations earlier this year. It's now been revealed underground crews at command centers that are about 100 feet underground violated the rules. They are two- man crews. If one of them is on an authorized sleep break, the door, the blast door to the underground command center is supposed to be shut tight. In two cases one of the crew members was asleep, the door was open.

Now the Air Force says there was no real security risk because there's multiple layers of security up top, on the surface, on the ground, there are fences, armed guards, sensors, all of that. There are protections in the nuclear launch codes, but after everything that's happened recently, including a top general being fired, this is not the kind of embarrassment the Air Force needs -- Wolf.

BLITZER: Yes, they never need anything like this. So who was punished here, Barbara?

STARR: Well, both launch crews did get punished. Two members were fined. Docked their pay, letters of reprimand. And in fact, one of the commander is now facing a discharge for it. An indication of the problems here and the Air Force's embarrassment. The real question perhaps, what else is going out there -- on out there that the Air Force may not even know about yet -- Wolf.

BLITZER: Barbara Starr, thank you very much.

Let's take a closer look at some of the other stories we're monitoring in the SITUATION ROOM right now.

The FDA is warning pet owners to beware of jerky treats after what it's calling one of the most mysterious outbreaks it's encountered. The agency says it has reports of 3600 dogs and 10 cats that got sick after eating the treats over the past six years. More than 500 of them died. Most of the treats were made in China.

Owners aren't being advised to stop -- let me repeat that. Owners aren't being advised to stop feeding the treats to their pets. Just to watch them closely.

For the first time, prosecutors in the Boston marathon bombing case are confirming that the slain suspect Tamerlan Tsarnaev was accused of participating in a gruesome triple homicide outside the city back in 2011. Sources informed CNN months ago that Tsarnaev was involved in the case but it wasn't until this week that the detail was confirmed. The allegations came from a friend of Tsarnaev's killed during questioning by authorities.

This is first on CNN from our justice reporter Evan Perez. Sources close to the Attorney General Eric holder now say he plans to stay in office well into next year at the request of President Obama. This after more than four years of very tense run-ins with Republicans, clashes with some of the president's top advisers, that led some to believe he was on his way out.

Holder was the first ever sitting Cabinet member to be held in contempt of Congress over the notorious "Fast and Furious" gun sting. Staying for now.

Coming up in our next half hour, our Dr. Sanjay Gupta's exclusive hard-hitting interview with the Health Secretary Kathleen Sebelius. Sanjay getting ready to speak with me. Be sure to tweet us, by the way, some questions for him. Be sure to use the #sitroom.

And the royal baby makes a rare public appearance for his christening. Jeanne Moos is next.

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BLITZER: The royal family out in full force for Baby Prince George's christening. No lookalikes. Jeanne Moos is next.

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BLITZER: A picture perfect royal scene for little Prince George's christening. All real and no lookalikes.

Here's CNN's Jeanne Moos.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN SPECIAL CORRESPONDENT (voice-over): For once handsome Prince Harry kissing hits grandmother the queen was just the opening act for the new star, 3-month-old Prince George, was carried into the royal chapel by his dad. And there was a whole lot of jiggling going on, as Prince William displayed his son. Even the royal guard. Seemed to be jiggling.

But after the baptism being carried out by his mom, Prince George seemed sedate, a lot more sedate than this Prince George, who kept spitting up, as he posed for pictures, even pictures of the queen taking his picture, and Prince William changing his diaper, and Kate, William and George playing rubber-dub-dub in the tub. Wait a minute, the palace would never release these.

ALISON JACKSON, AWARD WINNING FILMMAKER/PHOTOGRAPHER: I have about five or six different Prince Georges.

MOOS: Alison Jackson is known for her celebrity lookalike photos. She's been having a field day with the royals.

JACKSON: This Prince William lookalike, there is only one of him, and he is fantastic. He really is. I have about five Kate lookalikes.

MOOS: Alison uses an 82-year-old wall of energy to play the queen. The photographer says these photos aren't about the royals. They're about us and how we feel about the famous.

JACKSON: Obsession, world gone crazy with celebrity.

MOOS: We should have known something was amiss when we saw Prince William and Catherine posed half naked. There's something intimate about these fake photos, dirt on the soul of the prince's foot dangling out of the tub. Of course, the actual royals don't comment on things like this.

JACKSON: I hope they find it amusing.

MOOS: She's been doing this for a decade posing lookalikes ranging from David Beckham to Kim Kardashian, Kanye West and their baby North West.

Alison is currently out west in L.A. shopping for more lookalikes.

JACKSON: Anybody that looks like Miley Cyrus, that would be fantastic.

MOOS: She sells the queen diapering the royal baby on a tote bag, the prince doing diaper duty on a T-shirt. And then there's this.

(On camera): And what are we calling that thing?

JACKSON: Well, a milk man-boob.

MOOS (voice-over): Fit for a prince. And you be the judge of how alike this little lookalike looks.

Jeanne Moos, CNN, New York.

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