ties to the terrorist group in afghanistan. top officials have indicated this week that there is evidence that pakistan's intelligence agency is supporting what is called the haqqani network and now going one step further saying they believe that the support is coming from the agencies' highest ranks. our pentagon correspondent barbara starr is standing by with the latest. barbara, a lot at stake right now, and what are the officials saying? >> well, wolf, pakistan is supposed to be one of the u.s.'s closest allies in the war of terror and the united states gives them billions of dollars in aid, but for the third day in washington, tensions are ratcheting up. today, a top u.s. military official said indeed, it is the top leadership right at the top of the isi, the pakistani intelligence service that is supporting the haqqani network with money, training and advice and supporting the attacks within pakistan and some of those troops killing u.s. troops in afghanistan and of course afghan civilians this is coming after mike mullen and leon panetta have been saying all week that the attacks are no longer tolerable, and that pakistan needs to crack down on them. today, the pakistani army chief, mullen's counterpart fired back saying that mullen's comments are not accurate, and even saying that they are disturbing. in the words of general, the pakistani army chief of staff, disturbing comments by the american admiral he says that are not true, and especially because the two men just sat down over the weekend and had a meeting about all of this, but the pentagon is sticking by all of this saying that it is the top leadership of pakistani intelligence that is supporting the haqqanis. wolf? >> i want to be precise. the u.s. officials are also suggesting that the elements in the pakistani intelligence service were involved, behind, helped to plan the attack of the u.s. embassy in kabul? >> well, nobody is going into that level of detail that we have spoken to. where they are is that they say it is the top levels of pakistani intelligence supporting the isi, the haqqani network, and that haqqani network was responsible for the attacks against the u.s. embassy, against isaf headquarters and you have seen the video in the last several days of u.s. troops trying to defend the isaf nato headquarters and responsible for attacks against the intercontinental hotel in kabul and responsible for many attacks against military bases ak afghanistan and other facilities in kabul. they believe that the haqqani network has the financing, the backing of the pakistani intelligence service. wolf. >> barbara starr, thank you i very much, and yesterday, the pakistani foreign minister here in "the situation room" denied these allegations. real tension right knew between washington and islamabad, and we go to capitol hill again where the democrats and the republicans are on a collision course with a looming government shutdown just one week from today. it all comes down to critical disaster relief funds set to run out next week. let's bring in our congressional correspondent kate bolduan who is working the details for us. what is the latest, kate? >> well, as it was put today, the democrats and the republicans need to cool off this weekend with the senate returning for a vote monday evening, but it seems that the fight is far from over as disaster aid and government funding deadlines quickly approach. with lawmakers heading for the exits and after a long week of heated debate -- >> that is the danger to this country. is the $14 trillion deficit and the $1.6 trillion that we add to it every damn year. >> wake up! wake up. you can't kill these programs. this is the solution you are killing. >> reporter: congress leaves washington with no agreement on how to avoid another government shutdown. why the holdup as the september 30th deadline looms? neither side is backing down. top democrats and republicans continue to point fingers at each other. >> harry reid is holding a bill up with full funding of what is needed right now for no reason. no reason but for politics. again, this is why the people just don't have the respect for this institution, and this town anymore. >> i cannot understand their logic. i mean, do they want the government to shutdown? do they want fema to close? and fema will close. >> reporter: the house late thursday night narrowly passed a short-term spending bill to keep the government funded through mid-november and the measurement also includes what both sides say they care about most, ur jebtly needed money in the wake of the disasters of floods, fires and storms. >> it is a reasonable approach. >> reporter: but that plan was quickly rejected by the senate. and they strongly disagreed that the disaster demands be paid for by offset iting funds that once went to solyndra. >> is it really fair that the fund disaster relief that we take american jobs? >> reporter: senator reid has now countered with what the senate democrats call a compromise saying they will go along with the house measure providing 3$3.6 billion for federal disaster relief, but they will not go along with the offsets called for in the house measure. the stalemate now forcing at least the senate to put off part of its scheduled recess next week. wolf, we will see about the house. >> we will see what happens with one week to go, and counting. these guys have to get the act together, no doubt about it. thank you very much for that, kate. over at the united nations here in new york, a historic moment with serious implication forts if future of the middle east peace process. mahmoud abbas making an unprecedented membership bid for palestinian statehood amidst cheers of solidarity from crowds in the west bank. moments later, the israeli president benjamin netanyahu made his case before the general assembly. we will sit down and talk to him about it. first, let's go to the cnn senior united nations correspondent richard roth who is over at the u.n. with the latest. richard, how did this all play out today? >> dramatic history, wolff, with perhaps an uncertain future. electric speeches inside of the assembly hall between abbas, a netanyahu, and each making the pitch within the hall which does favor the palestinians. abbas got much more applause and several ovations from groups of different countries and it is time for a palestinian spring as he held up the application for formal statehood at the u.n. to applause. >> translator: this is a copy of the application. [ applause ] i call upon mr. secretary-general to expedite transmittal of all requests to the security council. i call upon the distinguished members of the security council to vote in favor of our full membership. >> reporter: the security council now has that statement, and will hold a meeting on monday. first initial meeting behind closed doors and no votes and no decisions expected. the israeli leader says he wants peace with the palestinians, but he must have security, and he wants to talk face-to-face with mr. abbas, and netanyahu saying in the same city, and let es do it here, but the palestinians want a settlement freeze and still many divisions. mr. netanyahu said we pulled out of gaza, and yet we still get missiles. >> would any of you, would any of you bring danger so close to your cities, to your families? would you act so recklessly with the lives of your citizens? israel is prepared to have a palestinian state in the west bank, but we are not prepared to have another gaza there. >> reporter: netanyahu saying they should have a peace between the palestinians with israel and then israel would be the first to declare and recognize the palestinians as a state here at the u.n. wolf. >> richard roth, you know, as i was watching, listening to mahmoud abbas speech before the general assembly and you remember when prime minister netanyahu spoke before a joint meeting of congress in may, the reception that netanyahu got in congress was very similar to the reception that mahmoud abbas got in the general assembly, i think that you will agree with that? >> i did. i thought about it in the speech and i also thought about 1974 with abbas appearing empty handed with gun in holster, and saying don't let the olive branch drop from my hand, and also declares zionism, and he said it is a theater of absurd in the generals is sem bli for what has been done to israel and various forums. >> you meant yasyassar arafat w the olive branch. >> yes. >> i know you have been out working all week. >> they still don't have a state. >> but i remember that 1974 speech that general arafat gave at the general assembly just as you do. just ahead, i will have my interview with prime minister benjamin netanyahu, and including president obama's controversial relationship with israel, and i will ask him if president obama is a friend of israel and if so, how close of a friend? we get through all of that. and next, why did a solar company touted by president obama go bankrupt after receiving hundreds of thousands of taxpayer dollars? actually closer to $500 million? the lawmakers want answers, and they are not getting any. every time a local business opens its doors or creates another laptop bag or hires another employee, it's not just good for business -- it's good for the entire community. at bank of america, we know the impact that local businesses have on communities, so we're helping them with advice from local business experts and extending $18 billion in credit last year. that's how we're helping set opportunity in motion. the spending battle is not president obama's only beef with congress today. today he blasted lawmakers over education reform and specifically the "no child left behind" law and taking new steps to change it. our correspondent dan lothian is working the story for us, and he has the latest. >> well, wolf, no child left behind was passed with bipartisan support in 2001, but since the beginning, it is quite controversial, and today the president said while the goals were admirable there were serious flaws that hurt children instead of helping them. >> reporter: declaring it is time to make america's education system the envy of the world, president obama took matters into his own hands allowing the states to opt out of no child left behind requirements and stiff penalties. >> thank you. the change we are making is not lowering the standards, but we are saying that we will give you more flexibility to meet high standards. >>er the states have to adopt the plan approved by the administration to put students on academic track for college and careers and they would also have to set guidelines for grading teachers and principals which could be controversial. the country's education system is still strugglinging to make the grade. >> i'm here to talk about the no child left behind. >> and ten years after president george w. bush unveiled no child left behind with much promise. >> this act is an important way to make sure that america remains competitive in the 21st century. >> reporter: but critics say it encouraged the schools to lower the standards in order to meet the goal of making all students proficient in reading and math by 2014. the department of education predicted more than 80% of the nation's schools could miss the target. running the risk of being shutdown or losing staff and critical federal dollars. >> congress has not been able to do it. >> reporter: president obama criticized congress for not acting sooner to fix the flaws in no child left behind. >> i will. our kids only get one shot at a decent education, and they cannot afford the wait any longer. >> reporter: there is bipartisan agreement on the problem, but not on president obama's solution. >> this is a significant executive overreach on the part of the obama administration, and states that accept the waivers might be accepting some temporary relief from washington, but ultimately, they will be taking long-term handcuffs. >> reporter: she is concerned about the federal footprint in the classroom. >> this is giving the education secretary far more authority to dick kate the policies that are implemented at the state and local level and really dictate what is taught in local schools. >> reporter: now she argued that instead of trying to fix a broken system that there needs to be comprehensive reform, one that gives more control to states, local communities and to irnt pas. wolff? >> dan lothian, over at the white house, thanks very, very much. lawmakers want the questions answered about why a solar panel manufacturer went bankrupt after receiving $500 billion in government loans. executives from solyndra were on capitol hill today, and lisa sylvester is there and following the story. how did it go, lisa? >> hello, wolff. the lawmakers didn't get many answers because the company executives invoked the fifth amendment right against self-incrimination today. the fbi and the inspector general and the treasury department are all looking into the solyndra, a company that has received more than half a billion dollars from taxpayers and money that is likely not to be recovered. >> you both swear that the testimony that you are about to give. >> reporter: the solyndra ceo and cfo were sworn in and peppered with questions, but more than ten times they declined to answer. >> i have been advised my my kocounsel it is better for me t insert my ability to decline to answer the question under the fifth amendment. >> fifth amendment. >> fifth amendment. >> fifth amendment. >> fifth amendment. >> reporter: lawmakers on the house energy and commerce investigation subcommittee are looking into $533 million department of energy loan guarantee to the now bankrupt solar panel company, and republicans have accused the obama administration officials of ignoring warning signs that solyndra was a risky financial bet, and proceeding with the loan as part of a broader green jobs agenda, and one lawmaker calling it a modern day train robbery. >> let me warn you and the other folks involved in this taxpayer rip-off, we are not done, no we are not. >> we asked solyndra's ceo and cfo and their lawyers if they had any comment after the hearing. did you do anything wrong? did you try to mislead lawmakers or investors in any way? is there anything that you want to say in your defense? >> reporter: right up to the very end the company executives were reassuring the committee members that the finances were strong n. a letter dated july 13th of this year, solyndra's ceo gave a glowing assessment of the company's finances claiming that the revenues were projected to double in 2011 and 49 days later solyndra announced it would be filing for bankruptcy. >> that is one of the burning questions that we have, how could that happen? how could they come to my office and others and paint the rosy picture and go into bankruptcy five weeks later. >> reporter: they were lying? >> i don't know if they were lying or what, but this is one of the things that we need to ask. >> reporter: ranking democrat diana degette says that the taxpayers have a right to know what happened to half a billion dollars, but she says that the solyndra case should not be used as an excuse not to fund other clean energy projects. and the committee said they were badgering the witnesses, so when they found out that it was clear they would not be answering the questions, she said that they were using cheap gimmicks not to answer the questions. >> so they looked stony and as you asked them the question, they kept on walking, is that right? >> yes, we asked questions to both the cfo as he was walking out as well as to the ceo brian harrison and we didn't get any kind of comment. we also addressed questions to their attorneys and their attorneys did not even make a statement at all, nothing of any sort, and not even a no comment. nothing from them. >> it is one thing for the principles not to comment, but another for the attorneys not the comment. thank you, lisa. good work. searching for the cause after a deadly air show crash, and what investigators are hoping to learn from memory cards and photographic equipment. and the jury in the hands of a man accused of killing his millionaire wife awaits a decision. 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[ whirring and beeping ] [ ding! ] and we give you a discount on both. great! did i mention no hands in the bundler? bundling and saving made easy. now, that's progressive. call or click today. i tell you what i can spend. i do my best to make it work. i'm back on the road safely. and i saved you money on brakes. that's personal pricing. investigators released the first report on the reno air race crash. lisa sylvester is monitoring that and other top stories in "the situation room" right now. what is going on, lisa? >> well, a preliminary report from the national transportation safety board says that a small piece of the tail separated shortly before the crash at the reno air show, but it does not include a probable cause of the crash. 11 people were killed when a world war ii era plane crashed into the box seats in front of the grandstands of spectators last week. the ntsb is examining memory cards from the plane's on board camera. a jury is deciding whether a florida millionaire killed his wife in their mansion two years ago. james bob ward is accused of shooting his wife between the eyes. prosecutors say he admitted killing her in the 911 call, and then told conflicting stories saying that she died after a struggle over to the loaded gun. italian prosecutors are presenting the closing statements in the appeal of amanda knox case. they urgeded the jurors to put themselves in the place of the victim's parents. knox and her boyfriend were convicted of killing her british roomma roommate, and attorneys are expected to prevent final arguments early next week. >> we will see what they have to say. thank you, lisa. me may be the front-runner the republican race for the white house, but could that change after last night's debate? plus my interview with the prime minister benjamin netanyahu and he is answering bill clinton's claim that netanyahu is slowing down the peace process. ♪ soon the sun ♪ is going to shine ♪ [ male announcer ] toyota presents the prius family. ♪ walk if i want, talk if i want ♪ [ male announcer ] there's the original one... the bigger one... the smaller one... and the one that plugs in. they're all a little different, just like us. 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