and not any hounddog. she's america's top dog. a stunning upset at the country's most famous dog show. we'll introduce you to hickory. good morning, everyone. and how about that scottish deerhound, crowned best in show last night? the first of her breed to ever win. and after you meet hickory, here on "gma," she has a state dinner tonight. >> not a bad celebration. we have a lot of news. the first interview with bernie madoff. we're also tracking a developing story out of mexico. two american customs agents were shot. one is dead. and our special, live guest this morning, new york mayor, michael bloomberg. we'll talk to him about the budget crisis. also bernie madoff's new claim, that the big banks he was working with, had to know about his fraud. let's get right to bernie madoff. he's speaking out, for the first time, since his conviction, for orchestrating one of the biggest ponzi schemes in american history. he is still insisting his family knew nothing about his crime. but he is pointing fingers. our brian ross looks closer into this. >> reporter: it's quite a story. madoff, apparently now spending his days in a 12-foot-square cell, with a window, overlooking the prison lawn, with his roommate. the interview was his first since he went to prison. and he's still trying to spin the case in ways he apparently thinks will help him. madoff was interviewed tuesday by "the new york times," at this federal prison in butner, north carolina. no reporter had seen him since he entered the prison in july 2009, in shackles and a blue jump suit. reporter diana enriques noticed he looked slimmer, frail and agitated. in the interview and a series of e-mails, madoff pointed the finger at unnamed banks and hedge funds he said were complicit, and had to know about his massive ponzi scheme. but the attitude, he said, was, if you're doing something wrong, we don't want to know. that's much the same claim the bankruptcy trustee has made in court filings against madoff's family and close associates. >> some of these people were in control or were absolutely in a position to understand what was going on. >> reporter: madoff's wife, ruth, who helped keep the books, has denied any knowledge of the scheme. and madoff, in "the new york times" interview, continued to protect his family. saying they were unaware of his crimes until the very end. madoff's most impassioned comment, came on an ak attack of the news media, for what he described -- there's no indication from "the new york times" article, whether madoff himself felt any responsibility for his son's death. madoff also told "the new york times" reporter that his cooperation had helped the bankruptcy lawyers recover some of the billions of missing dollars. one of the lawyers said that's completely untrue. his quote, madoff is incapable of telling the truth to this day. >> and a lot was made of madoff's son funeral. and he talked about that, too. >> reporter: he said he had asked permission to go. but they did not let him go because of a public safety issue. they felt it would be a media circus. and it would be cruel to put his family through it. we were told the family didn't want him there. his son and -- his son indicated to his widow, he was through with his father and was disgusted by what his father had done. >> a lot of people feel that way. brian, thank you. we're going to turn to the ugly attack in egypt on cbs news correspondent, lara logan. it happened when the crowd learned that president mubarak was out. for the latest details, let's go to martha raddatz in washington. cbs news isn't saying much about this incident. but they described it as a brutal and sustained sexual assault. >> reporter: we know dozens of journalists were attacked in egypt before hosni mubarak stepped down. but this brutal attack occurred in the midst of looked to be a celebration. february 11th. cheers of joy in cairo, as president mubarak resigns. but deep within the jubilant crowd at tahrir square, as cbs news correspondent, lara logan, and her team were surrounded, by what cbs news statement said, was a man of more than 200 people, whipped into a frenzy. >> lara was covering the celebrations in cairo last friday, when she was surrounded by a mob, sexually assaulted and beaten. she was rescued by a group of women and egyptian soldiers. >> reporter: logan had been reporting from egypt since the protests began. >> this is what can happen to you in egypt, if you try to expose corrupt policemen. >> reporter: days later, she was detained and interrogated. in an interview with pbs' charlie rose, logan said the egyptian army labeled her and her crew, spies. >> they let us know, in no uncertain terms, that they were tracking us. they knew who we were. they photographed us, when we were blindfolded. and my colleagues, max mcclellan and don lee, were handcuffed. >> reporter: but logan returned to tahrir square. she had fearlessly reported from dangerous places all over the globe. [ gunfire ] >> reporter: but now, with a family and young children, she recently told cbs' "60 minutes overtime" it's another worry. >> i have to think about my children growing up without their mom. i don't want to think about it. i hate to think about it. >> reporter: logan has now been released from the hospital and is back at home here in washington, with her husband and two children, recovering. and, george, of course, we wish her our very best. >> we do. hope she's back to work soon. we're going to turn, now, to the increasing risk of american officials helping fight mexico's drug war. two officials driving from mexico city to monterey, were attacked by gunman, about an hour south of the texas border. ryan owens has more. >> reporter: these two agents were assigned to the u.s. embassy in mexico. we know murder has become a daily ritual in the drug war here. but this really is different. if these u.s. agents were targeted, this is a dangerous escalation. special agent jaime zapata and the other agent were driving in this suv, when officials fear they were ambushed. the two were heading north to monterrey. they had stopped at a military checkpoint on the highway. mexican investigators fear that so-called checkpoint was staffed by zetta gunmen, for a drug cartel. zapata, who was based in laredo, texas, and just garaged college in 2005, was killed. the other agent was shot in the arm and leg. and was air-lifted to a mexico city hospital. while mexican and american authorities try to piece together who shot the officers and why, this becomes just the latest example of violence against americans in or near mexico. in december, border patrol agent, brian terry, was shot and killed in a gun battle in the arizona desert. the previous summer, another border parole agent, robert rosas, was killed just near san diego. husband, david, was shot and killed by mexican pirates on falcon lake, along the mexican board we're texas. >> hello? >> ma'am? okay. are you sure that your husband got shot? >> yes. in his head. >> reporter: secretary of homeland security, janet napolitano, condemned this latest violence. calling them unconscionable crimes. and vowing u.s. officials will work closely with mexican authorities to find the killers. and this morning, we've learned that the fbi will be assisting mexican authorities down here with this murder investigation. bringing u.s. law enforcement into a sovereign country always requires a delicate diplomatic dance. and, george, you can bet that dance is already under way this morning. >> ryan, thanks very much. new york mayor, mike bloomberg joins us now. he's unveiling a new campaign to toughen gun control. mayor, thanks for coming in. i have to begin with the news from bernie madoff overnight. saying the banks had to know about his fraud. i know he had credibility problems. but it seems like the trustee is going down this road, as well. do you believe it? >> i don't know who knew what. what i do know is bernie did it. bernie destroyed an awful lot of human beings. his own family. it's tragic. no less tragic than other families. what he did broke the law. knowing he was going to do it. he knew in the end it had to end terribly for a lot of people. people trusted him. and they shouldn't have. i knew the guy casually 30 years ago, 20 years ago. the s.e.c. put together a study of the marketplace. i was at solomon brothers and goldman sachs was there. bernie was there. >> he didn't suspect anything back then? >> he was a nice guy back then. and i hadn't heard his name for 20 years. >> if you're getting those returns, you know something's going on, right? >> anybody who thinks they can beat the market long-term, by an awful lot, is unrealistic. i think the lesson is a lesson that your mother told you and my mother told me, a long time ago. don't put all your eggs in one basket. anybody that put all their money with one manager, i don't care if he's honest or not. diversity makes some sense. should have done that. >> before we get to the guns, let me ask you a quick question about the president's budget. the president has conceded this will stabilize the budget over time. but not solve the problems. and republicans on capitol hill, are accusing him of punting by not taking on entitlements. do you think the president made the right decision by not putting out a whole solution? or did he punt? >> if republicans want to criticize, they should put out our suggestions, their part of government, as well. but both ends of pennsylvania avenue have to come together and agree they're going to do something for america. and not use it as a cheap, political trick. unless you do something about the entitlements, which take up two-thirds of the budget, you're not going to solve this problem, unless you do something about the cost of defense. you're not going to do anything about the budget. to take the small amount that's left after you take medicaid and medicare and social security and debt service and armaments of the military, there's very little left. and you're going to start cutting out the fbi. cut out the faa. cut out the top moneys, which is our future. i don't think so. you should start with not how much many we have and not what we should do. start out with what does society need? without wasting any money. what programs do we have to have to have a future for our kids? and then, find the ways to do that as efficiently as you can. and then, whatever you don't have, that's the amount of money you have to raise. >> new revenues, right? >> i don't know that. all i know is -- i don't hear people -- the president did, in all fairness. but i don't hear congress saying, we have to have these programs or we don't have a future. we have to have a strong military. we have to fix public education across this country. we have to do something about guns that are killing 34 people every day, that we're going to talk about. how do we do those things? and what does it cost? >> let's get to gun violence. you have a truck outside. >> we do. we have a truck called fixgunchecks.org on the internet. it will go around the country. it shows the number of people who have been killed. since tucson, 1,300 americans have been killed by handguns. thin rfk, robert kennedy, and martin luther king were killed, 400,000 americans have been killed by guns. that's more than the number of americans killed in world war ii. and we're doing nothing about it. we say we should be more civil to each other. couldn't agree more. but in the end, we have some failings in this country, in terms of keeping guns out of the hands of minors. out of the hands of criminals. out of the hands of people with mental problems. out of people with -- >> better background checks? >> we need the background checks have some loopholes. you don't have to have a background check if you go to a gun show, where supposedly, a casual seller can operate. the government, the federal government, raided some casual seller's home, he had 800 guns at home. >> you went undercover to a gun show last month. the a.g. called it a p.r. stunt. >> most of the arizona newspapers said, this should be a wake-up call for arizona. the truth of the matter is, you can't sell a gun by federal law to somebody who says, i couldn't pass a background check. if they say that, you know they're not going to qualify. and gun dealers were doing it. not all. 99% of gun dealers are honest. it's the 1% that's putting guns in the hands of kids, criminals, addicts, and people with mental problems. they're the ones that kill us, kill our children, kill the cops that are putting their lives on the line to protect us. >> we only have a few seconds left. i know you've taken yourself out of the 2012 presidential race. >> yes. >> another new yorker may be getting in. donald trump. what do you think? >> america's a wonderful country. everybody born here over 35 has an opportunity. i know donald trump. he's a great guy. he doesn't do everything he says. but he sure tries. i'm a big fan of donald trump's. >> think he's going to run? >> i have no idea. you'll have to ask donald trump. >> mayor bloomberg, thanks for your time. robin? >> george, okay. and the economy. get ready to dig a little deeper into your wallet this year. prices on just about everything, from your morning cup of coffee, to your new pair of jeans, expected to climb significantly in 2011. and the reason why, might surprise you. our weekend anchor, bianna golodryga, you're going to delve into this, aren't you? >> reporter: call me the debbie downer of morning television. you usually talk about higher gas prices. this year, gas prices are one of the many higher costs burgeoning consum consumers. the food you seat, the clothes you wear, to the machine you use to watch them, get ready for sticker shock. attention shoppers, a price check for you. groceries, they're up. clothing, that's up, too. costs are surging in nearly every aisle in every store. it's a global dmem ma, made of misfortune. bizarre weather patterns have destroyed crops. and prices are soaring. corn, up 60%. when grain prices rise, so do the costs of the animals that feed on it. economists anticipate a 6% rise in food costs this year. approximately $328 more per family than last year. and in closets, even higher prices. the cost of cotton has skyrocketed 150% since last year. economists predict a 10% increase on clothing. that's an extra $139 for your family this year. and in garages, even more pain. gas could go up as much as 13% this year. an extra $262 per household. when it all adds up, those increases could cost a family $729 more on just basic items alone. and after the bipartisan tax deal was passed in december, 2011 was supposed to be the year that we finally put some extra cash in our pocket. the tax policy center estimated the average family would save $772 this year. look at the three factors we talked about. you talk about clothes, you deduct the price you're paying for that. that leaves $633. take out gas costs, you're left with $371. and you're add in the food, robin. $43. and the prices are expected to rise, for a number of items, going forward this year. maybe you can take george out to a movie. that's all the money you'll have left over now. hourly earnings have only risen 2%. >> just $43. you do the math. that's what's left. it costs more to take george out to a movie in new york, than that. let's get over to sam, now, with the weather. good morning. >> how about morning good news. that's the warm air that's just about all over the place now. it spreads into the central plains. headed north. chicagoland, up to 44 today. raleigh, at 61. dallas, 72. midland, odessa, texas, area, 85 degrees. that's a record in that area. that's how warm it's going to be. and here comes the wetter pattern. redding, san francisco, l.a. san diego, you're getting some rain today. the red area, northern california, could be up to four feet of snow above 7,000 feet of elevation. this could continue over the weekend, as well. a look at the cooler air in the northeast, to start the day at 26. you'll end up milder as the day goes on. high temperatures will be comfortable there. scattered clouds overhead making for a nice picture of the sunrise. scattered clouds will clear out later today. 32 at the list, 32 in winchester. 25 in martinsburg. 23 in frederick. we will warm up into the mid- 50's. pushing 70 again by friday. the cold that list of warmest cities in the country, was provided by royal caribbean international. george? >> thanks, sam. it's time for america's top dog. the scottish deerhound walks off with best in show. she is the first of the breed to win the honor. and john berman went one-on-one, with the winner. >> best in show is the deerhound. >> reporter: she's a tall drink of water. a tall, hairy drink of water. now, she's america's top dog. great scot, you might say. meet hickory, a scottish deerhound. >> here's hickory. >> reporter: it's the first time this breed has ever won best in show here. not exactly a regular sight in america. a bit gangly. they were bred for hunting and don't fetch much. but they are the royal dog of scotland. and hickory? well, we're told she's an 85-pound bundle of love. >> she loves unconditional, no matter what. >> reporter: the lanky 5-year-old from virginia prevailed over 2,600 other dogs. 178 other breeds. what does it take to win this show, when all the chips are down? or kibble, at least? >> it sounds funny to say, but they're great athletes. and they have to understand when it's time to step up. >> reporter: they're big-game players? >> absolutely. and they have to be to be at this level. >> reporter: some dogs just don't have it. >> looks like something you should have for your car wash. >> reporter: labs, the most popular dog in america, and golden retrievers, have never won best in show. never. >> for the scottish deerhound, hickory. >> reporter: but hickory got game. we spoke to her, in her first network interview, after the win. well done, hickory. well done. do you think it was the hair that did it? they never do this at the super bowl. i've never touched a champion before. for "good morning america," john berman, abc news, new york. >> big exclusive for john berman there. hickory's something. she wasn't used to the lights or anything. she spends almost all of her time chasing deer and rabbits. on a 50-acre farm. she is getting a steak dinner. >> you think of the movie "best in show." >> terrific movie. coming up on "good morning america," we're talking to the teacher suspended for slamming her students online. called them things like triflely dim. she says she did nothing wrong. plus, on the wrong foot. the shoe that promises to help you get in shape, hurt this woman's body. why she's suing skechers. who says credit card rewards can't be simple? 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