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Payroll Tax Cut Hits Stalemate; "Shouldn't Be Politics As Usual"; Gingrich Touts New Endorsements; Housing Recession Was Worth Than Thought; Three Troops Charged In Soldier's Death; Saudi Prince Buys Stake In Twitter

Aired December 21, 2011 - 10:00   ET

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


T.J. HOLMES, CNN ANCHOR: Well, the clock is ticking on your money. Ten days left and your taxes are going to go up unless lawmakers do something. The typical American paycheck will shrink about $1,000 over the next year if lawmakers do not act before the New Year.

Both parties, get this, they actually want the extension. The problem is, House Republicans refuse to settle for the two-month extension that was passed by the Senate. Listen.

(BEGIN VIDEO CLIP)

REPRESENTATIVE JOHN BOEHNER (R), HOUSE SPEAKER: The next stop is clear. I think President Obama needs to call on Senate Democrats to go back into session, move to get a conference and to sit down and resolve this bill as quickly as possible.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: I saw today that one of the House Republicans referred to what they're doing as, quote, "high stakes poker." He's right about the stakes, but this is not poker. This is not a game.

(END VIDEO CLIP)

HOLMES: Well, our Kate Bolduan is on Capitol Hill and Dan Lothian at the White House. Kate, let me start with you. The most important thing to Americans right now, explain the path, the thing that needs to happen over the next 10 days and how it's going to happen to prevent taxes from going up for 160 million workers in this country.

KATE BOLDUAN, CNN CONGRESSIONAL CORRESPONDENT: It's not entirely clear how the end game or how this will play out. Here's why. Because the log jam, the stand still, the standoff, whatever you want to call it is still in place.

They're still just staring at each other saying we have acted and it's now your turn. House Republicans say that they have acted as rejecting the Senate compromise measure for a two-month extension. They rejected that yesterday.

House Republicans say the ball is in the Senate's court. However, Senate Democrats say they're not going to reopen negotiations towards a one-year deal as you well noted. Both sides want until the House passes this two-month extension.

So they're staring each other down still. Meantime, pressure is mounting not only on Congress understandably, but also specifically on House Republicans. It won't surprise you that Democrats in the White House are really picking up the pressure. House Republicans are feeling the heat from that direction.

But also Senate Republicans who supported the compromise passed in the Senate have come out to criticize House Republicans calling them of yesterday irresponsible.

And add to that just this morning "The Wall Street Journal" editorial page, an influential conservative voice had an op-ed criticizing House Republicans as well.

Saying here in part, I'll read you a couple parts, it says, given how he, who is top Republican in the Senate, Mitch McConnell and how Speaker John Boehner have handled the payroll tax debate, we wonder if they might end up re-electing the president before the 2012 campaign even begins in earnest.

It goes on to say at the end, at this stage, Republicans would do best to cut their losses and find a way to extend the payroll holiday quickly. Still, T.J., no way to tell viewers yet if or if not this payroll tax cut will be extended.

HOLMES: OK, let me bring Dan Lothian in. Kate, you stay with me. But Dan, nobody it appears wants American's taxes to go up January 1, including the president, including Republicans, and Democrats on the Hill. But from a political standpoint, is the president and the White House just loving this right now?

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: Well, look. They're not going to stand in front of the camera and say, you know, we're loving this.

When you prod them on whether or not the president stands to gain from this politically, what they'll tell you is that what the president is most concerned about is that he wants to make sure that taxes do not go up on middle class Americans.

Make no mistake here. The president does stand to benefit from this. You look overall as the numbers -- popularity numbers or approval ratings for Congress continue to go down, you see that the numbers are going up for the president compared to last month.

So they see that there's value in the president coming out of this and House Republicans end up getting the punch for it.

HOLMES: So what's the plan today? Is there a plan today, meetings or anything, conversations? I'll ask from your end first, Dan. Maybe, Kate, you can chime in as well.

But what is the plan for today, the next couple of days? I mean, everybody high-tailed it out of there. Just a few of the leadership left to do the work -- Dan. LOTHIAN: That's right. Well, you know, behind the scenes a lot of back and forth continues and one of the things that the White House is doing is essentially launching a publicity campaign here pushing back on Congress trying to get the public on their side to weigh in.

They're breaking down the numbers saying that the average family who makes $50,000 a year stands to lose about $40 every paycheck. So they put out the word to the Twitter verse for people to weigh in using the $40 hash tag.

Here's an example of some things that have come back. One person saying, quote, "$40 is a third of my student loan, half of my groceries and gas money for the week."

Another writes kids' school lunch $40 and then finally, $40 is the amount that's in my bank account right now." And then of course President Obama as you heard yesterday when he popped into the briefing room pointing the finger at lawmakers saying that now is not the time to play games.

Now is not the time to play politics. That they should put their disagreements aside, focus on where they can find compromise and get a deal. Of course, House Republicans blaming the president saying they don't like this two-month extension. They want something much longer.

HOLMES: And Kate, can you wrap it for me about 15, 20 seconds. Work being done on the Hill? I mean, what's the plan today?

BOLDUAN: Well, as Dan was noting, kind of the pressure, the publicity pressure taking place. That's happening on Capitol Hill as well.

Both the House and the Senate, the majority of members, have left town as the reality is, there's not much to negotiate at this point as the leaders are dug in.

But House Speaker John Boehner, he's holding a meeting with the members of his party that he has appointed to this conference that they want to go to kind of hash out the differences between the House and the Senate.

But they're going to be negotiating with themselves today because the Senate Democrats have made it very clear that they're not going to appoint members from their side as they're not willing to re- open negotiations until this two-month extension is pushed through.

HOLMES: All right. Dan Lothian, Kate Bolduan, thank you both. We'll be checking with both of you throughout the day.

At 6 minutes past the hour, I want to turn back to some presidential politics. Newt Gingrich picking up a couple of endorsements as we speak. Jim Acosta is keeping an eye on this for us today.

Jim, Gingrich, he kind of, I don't want to say peeked, but he got to a point in the polls and now it seems he's been slipping a little bit. He needs a couple of endorsements. Are these going to help him out any?

JIM ACOSTA, CNN POLITICAL CORRESPONDENT: You know, they might, T.J. It's been a tough week for Newt Gingrich. He's rolling out some endorsements today, some pretty important endorsements from the speakers of the Houses in both Iowa and New Hampshire.

So I guess it's the speakers endorsing the speaker. So that's good news for Newt Gingrich because he lost out on a major endorsement in Iowa yesterday when Bob Fanderplats who is a very influential social conservative in that state decided to go with Rick Santorum instead of Newt Gingrich.

He told me personally that part of this was because of concerns inside the Evangelical community out there in Iowa about Newt Gingrich's personal life. So it was a tough blow for Newt Gingrich. He's just been having a tough time out there on the campaign trail.

Every day he's getting hammered with these negative attack ads. Many of them coming from a super pac that is friendly to Mitt Romney's campaign.

Then out of nowhere Gingrich went into an Iowa grocery store yesterday where he was essentially accosted by a random voter who came up to him and told him in no uncertain terms what he thought of the former speaker.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: You know something? You're a (inaudible).

GINGRICH: Luckily it's a free country and that's your opinion.

(END VIDEO CLIP)

ACOSTA: So it's been that kind of a day, that kind of a week for Newt Gingrich. He was taking some questions from reporters later on that evening where he was asked about all of the negative attacks, all of the trouble that he's had in this campaign and the former speaker said he's not backing down.

(BEGIN VIDEO CLIP)

GINGRICH: I am the most insurgent campaign since Ronald Regan. The establishment deeply wishes I would go away. I hate to tell them this, but I'm not leaving.

(END VIDEO CLIP)

ACOSTA: And there's good reason for Newt Gingrich not to leave the scene. He is doing quite well in a poll that has just come out in Iowa. It's the latest poll showing where things stand in that state.

Yes, while Ron Paul is on top there at 28 percent, that's very good news for the libertarian Republican. Newt Gingrich is hot on his heels. So after all of these negative attacks, Newt Gingrich is still hanging in there within the margin of error.

Mitt Romney is a good almost 10 points behind Newt Gingrich. So the former speaker of the House has a very, good shot at winning that state, T.J., and that makes this race very interesting.

HOLMES: All right. Jim Acosta for us in Washington. We'll see you again here soon.

While all that's going on in the Republican side, President Obama may have a little something to cheer about this holiday. New CNN/ORC poll shows the president's approval rating has climbed some 5 percentage points since last month. His disapproval numbers also edged down.

Our latest poll also shows the president building on his lead over potential GOP nominee Mitt Romney, 52 percent versus Romney's 45. The president enjoys a similar lead over another Republican if the election were held today.

Congressman Ron Paul with the GOP nominee, our poll shows Obama winning 52 percent to 45 percent as well. We'll have more on the president's surge in the polls coming up at the bottom of the hour.

We'll check in with our CNN political director, Mark Preston for his insight into what's causing the president's new-found popularity.

We're getting a bit of a reality check on Wall Street today. It turns out the recession in the housing market was worse than we thought.

The National Association of Realtors is going back and revising past reports on home sales. Felicia Taylor at the new York Stock Exchange. Felicia, we knew it was bad, now they're telling us it was worse.

FELICIA TAYLOR, CNN BUSINESS CORRESPONDENT: Yes. Unfortunately, they're going back and making these revisions all the way back to 2007. So, you know, for people out in the United States, I don't think this is much of a surprise because they know how bad it really was.

But nevertheless, we saw the numbers today. They did increase by about 12 percent, but you know, it's a question of where we came from so at the rate of 4.4 million versus 4.9 million in the previous month.

And that number really is significant because you have to take a look at what is considered a healthy market. A healthy market would be considered 6 million.

So although the number is up, it's coming off of that place that was a lot lower than people expected. So we're moving in the right direction.

I guess, you know, the point that could be made is we were sicker than we thought, but we're still getting better. That's the good news in this report -- T.J.

HOLMES: Well, I appreciate the good news there to wrap it up at the end, but how is all of this news today affecting what we're seeing in the markets?

TAYLOR: Well, to tell you the truth, the market really isn't taking a look at this economic numbers. It's kind of interesting. I mean, markets are really still taking a look at what's going on in Europe.

They're focused on the European central bank and the kind of lending that it's actually made announcement about today. The problem with that is although they are admitting that they need to lend the money, the question is why they need to lend so much.

That's what the market is focusing on. The Dow right now is down about a third of 1 percent. The Nasdaq is the one that's really getting hurt today. It's down by 1.5 percent.

But that's because there were some worse than expected earnings out of Oracle and the concern is obviously that the tech sector is going to fare worse than people had first anticipated.

HOLMES: All right, the update, Felicia Taylor, thank you as always. It's about 12 minutes past the hour now.

Coming up, months after a soldier's body was found in an Afghan guard tower, eight other U.S. service members are charged in the death. A live report from the Pentagon is coming your way.

Howling winds and the sounds of snow blowers. Several states digging out after a major blizzard and another storm is right behind it.

(COMMERCIAL BREAK)

HOLMES: Well, as we come up on quarter past the hour. I want you to listen to something here in a moment. It's from one of the leaders in the House, Democrat Steny Hoyer, who is the Democratic Whip there in the House.

We just heard this from him. You know this back and forth is going on about that payroll tax cut that in ten days at the beginning of the year your taxes are going to go up unless Congress acts.

But there is a back and forth, some of them already gone home. Negotiations not really going on. Listen to Steny Hoyer. You won't see him in this video, but you'll able to hear him. Just made this on the House floor ago.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: The House stands adjourned until 10 a.m. on Friday.

UNIDENTIFIED MALE: Mr. Speaker. Mr. Speaker. REPRESENTATIVE STENY HOYER (D), MINORITY WHIP: Mr. Speaker, we'd like to ask for unanimous consent that we bring up the bill to extend the tax cut for 160 million Americans as you walk off the floor, Mr. Speaker.

You're walking out. You're walking away just as so many Republicans have walked away from middle class taxpayers, the unemployed and very, frankly, as well, from those who will be seeking medical assistance from their doctors, 48 million senior citizens.

We regret, Mr. Speaker, that you have walked off the platform without addressing the issue of critical importance to this country and that is the continuation of the middle class tax cut, the continuation of unemployment benefits for those at risk of losing them.

And the continuation of the access to doctors for all those 48 million seniors who rely on them daily for their health. And I am pleased to yield to my friend, Mr. Van Holland.

(END VIDEO CLIP)

HOLMES: So that just gives you gives an idea of the tone on Washington, D.C., right now. Again, your taxes are going to go up January 1st if they don't do something.

The Senate has passed a version that only extends it for two months but, still, that gets us through the next to the top of the year. The House has refused to take up that measure.

Republicans in the house want a full one-year extension, but at this point, there are no negotiations going on. We don't know where we stand at this point.

But in 10 days, we taxes are going up unless Congress does something. We'll keep you posted. It's 17 minutes past the hour.

I want to turn to a story of eight U.S. soldiers now facing some serious charges in connection with a fellow solder's death. Private Denny Chen was found in a guard tower in Afghanistan with an apparent self-inflicted gunshot wound.

Barbara Starr joins us now from the Pentagon. Now we're hearing that's not exactly what happened.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, there appears to be much more to this story now. It is not very easy to listen to. The 19-year-old Private Dann Chen in fact by all accounts did die in October in southern Afghanistan in a guard tower of a self-inflicted gunshot wound, but the question, of course, is what drove him to it?

How did he get to that point? Now today eight U.S. soldiers, his fellow soldiers, charged in connection with his death, charged for their conduct in the days leading up to his death.

We are told that the charges include everything from negligent homicide, involuntary manslaughter, battery, wreckless endangerment and cumulative communicating a threat.

The blunt bottom line here is this young soldier was bullied and hazed to the point he felt he had no other options. In a letter to his family, I want to quote from it, Danny Chen said, quote, "They ask if I'm from China a few times a day. They also called out my name Chen in a goat-like voice sometimes for no reason.

No idea how it started, but it's just best to ignore it. But apparently the hazing, the bullying solder on solder got much worse in the subsequent days and weeks. Danny Chen just simply could not cope with it.

Now soldiers are charged for their conduct. They have been moved to an undisclosed location in southern Afghanistan for their own safety -- T.J.

HOLMES: All right, Barbara Starr with a disturbing update from the Pentagon. Thank you as always.

Turn now to other stories making news across country. Ten Amish men and two Amish women have now been indicted in federal court in Ohio on hate crime charges.

Samuel Mullet Sr. leads a breakaway Amish group. The police say he and other suspects held down. Several other Amish men and women and cut of their beards and hair.

Also in Michigan, it should never come to this. A U.S. solder on leave from Afghanistan needed a little extra cash for the holidays so he ended up pawning his purple heart.

Now he has two of them so he pawned one, but still several people hearing this story, they stopped by the store and even had been calling that pawn shop wanting to buy it just so they could give back to him.

The pawnshop's owner says, however, he will keep it. He'll keep it safe, keep it on display even. But he's not going to sell it. Going to make sure it's available when that solder does come back.

Vernon McQuinn of the Detroit Pistons playing Santa Claus. Virginia is where he grew. He said he had to go without Christmas gifts on a number of occasions. When he was a child, didn't want that to happen to kids at this preschool so he made a Merry

Let's turn to some weather now. It's going to be severe. Some places affecting some of your holiday travel plans. A blizzard slammed the nation's mid section. It has now moved on. Montana, Wyoming, Colorado, New Mexico, they can expects some heavy snow today. How complicated are things going to get -- Rob?

ROB MARCIANO, AMS METEOROLOGIST: Well, as always, depends where you are and what you have planned because you know, a lot of folks want a white Christmas during the holidays.

Then again if you're traveling, especially over the hills to grandma's house, you don't want that happening. The blizzard has moved off. Most is in the form of rain. What is the blizzard is a heat pump with tropical moisture and warmth getting up to the north east.

So even though we've seen some spots that have had some slick spots as far as pockets of subfreezing air this morning. Most of that is now being scoured out. The next system is about to drop in the northern Rockies, winter storm warnings and watches have been posted for this area, including Denver and New Mexico.

It got hammered with this last blast of winter. Lesser amounts expected for this next storm. What happens beyond that is this storm currently heading towards the northeast rockets off towards the Canadian Maritimes.

The next storm that's dropping in will be riding up the Appalachians. It will take a similar path. It won't be quite as mild. There is a chance of some folks seeing a little bit of snow out of this, but mostly it's going to be north and west of the bigger cities.

It will be wet on the back side of this. So that is your best chance, I think, for seeing a bit of a white Christmas. It is mild out there. Because of the mild air we're seeing some pockets of fog and there are some delays at the airports because of that.

We'll probably see that again tomorrow. Today's high in New York City, 58 degrees, 61 degrees in D.C. Winter officially arrives tonight around midnight. Certainly, it doesn't feel like that at least for the eastern third of the country. T.J., back over to you.

HOLMES: Rob, thank you as always, kind sir.

It's 22 minutes past the hour, the International Space Station getting three new crew members soon.

Yes, this rocket launch this morning carrying U.S. and European astronauts as well as a Russian cosmonaut. The space craft will dock with the space station on Friday morning.

Also coming up here, everybody's just all a Twitter right now, literally, over a Saudi prince's big investment. We're talking about it and the fears from this new investment in Twitter.

(BEGIN VIDEO CLIP)

BILL CLINTON, FORMER U.S. PRESIDENT: I love this work. Anybody that had the life I've had, anybody that was given the gift that I was given by the American people, you'd be crazy not to do it.

(END VIDEO CLIP)

HOLMES: And a little later our Alina Cho sits down with former President Bill Clinton talking about his charitable work since leaving the White House.

(COMMERCIAL BREAK) HOLMES: A billionaire Saudi prince puts his money on social media buying a big stake in Twitter. News is raising some eyebrows now.

Douglas Rushkoff is a professor of Media Studies at NYU. He writes about technology for the "Daily Beast" as well. Just wrote an opinion piece for cnn.com saying should Twitter fear the Saudi prince. Thank you for being here. Do we have anything to be worried about here?

DOUGLAS RUSHKOFF, AUTHOR, "PROGRAM OR BE PROGRAMMED": We may have something to be worried about. Not worried about Saudi Arabian influence on twitter. If anything, I think Saudi Arabia would be more worried about Twitter's influence on its own population.

I guess, you could say it might be possible that the Saudi prince witnessing Arab spring was made more aware of the power and promise of social media, less as a revolutionary tool than as an economic powerhouse for the future.

HOLMES: Well, why not be worried? You said not really worried about the Saudi prince who's making a $300 million investment in Twitter.

Why shouldn't people be somewhat concerned or raise an eyebrow that maybe they try to have some influence and have some influence on the direction of Twitter which has played such a role in these up risings?

RUSHKOFF: Well, you could think that except he's also got investments in Citigroup, he's got investments in Apple. When I look at him and the group, the investment group that he's working with, it looks much more like what he's trying to do is capitalize on the kinds of IPOs that Groupon or Linked In, that Facebook is going to have some day.

It seems in that sense much more earnest, if you will. But what you have to remember is that money launders almost by definition. In other words, there's nothing weirder about a Saudi prince investing in a technology that might bring down his empire.

As an American investing without even knowing it through their retirement plan in companies that might be addicting their kids to cigarettes or alcohol or we're all invested in weapons manufacturing.

Whether we agree or not with the oil industry, we're paying for that too. It's almost as if money creates this disconnect between the investor and whatever it is they're investing in.

HOLMES: Douglas, last thing, I know what your answer is going to be. This is all about money, but a lot of people question, why would Twitter allow this and get into business with this guy if they know what the perception is going to be?

RUSHKOFF: Well, Twitter doesn't really have a choice who they get into business with. Once you sell shares, those shares can be bought by anybody.

It's not that the prince is investing in Twitter as such. It's not like Twitter is getting the money. The people who are getting the money are people who already invested in Twitter.

It's $300 million of shares that are out there. I think what everyone has to look at is once you sell your company, once you have sold it, you've sold it. You don't have control over who's going to own it after that.

HOLMES: All right. Douglas Rushkoff, we will see what happens down the road, but an interesting read. It has an article that you can see on cnn.com/opinions. Should Twitter fear the Saudi prince? Thanks so much, Douglas.

As we get close to the bottom of the hour now all eyes on Iowa. Michele Bachmann says do not count her out, but a big endorsement for Rick Santorum has him feeling pretty good about his chances as well. Do either one of them have a good shot? Your "Political Buzz" is next.

(COMMERCIAL BREAK)

HOLMES: Well, I'll give you a look at some of the stories making headlines as we come up on the bottom of the hour.

The U.S. has been in contact with North Korea's government since Kim Jong-il's death. The State Department says the talks mostly focused on possible U.S. food aid to the country.

Also the House has adjourned for its holiday break with no vote on the Senate-passed two-month extension of the payroll tax cut with no further action by lawmakers the tax cut will expire in ten days. Your taxes will go up.

Also a report just out shows home sales during the housing bust were worse than we thought. In fact, existing home sales between 2007 and 2010 were 14.3 percent worse than first reported.

We turn now to your "Political Buzz". Your rapid fire look at the best political topics of the day. Three questions, 30 seconds on the clock.

Who do we have playing today? Oh there she is, CNN contributor Maria Cardona. Also Sirius XM political talk show host and comedian, Pete Dominick always good to see you. And Crystal Wright, joining us for the first time here on the "Buzz". Pete, Maria, you all take it easy on her, will you? She's the Republican --

(CROSSTALK)

MARIA CARDONA, CNN CONTRIBUTOR: Oh she can take care of herself.

HOLMES: She's the Republican communications consultant for Baker Wright. Let's start of course with this "Wall Street Journal" op-ed asking how in the world Republicans managed to lose a tax issue to Obama?

Maria, let me start with you. Can we go that far yet? Are we serious now, Obama has won a tax issue?

CARDONA: We are certainly -- it's certainly looking like that, T.J. And I think what's interesting here is that Republicans clearly are looking at this as a high stakes political game. And as the President said, they're certainly high stakes. But this isn't a game. Especially for the 160 million Americans whose taxes are about to go up January 1st.

And the House Republicans, this is going to be political kryptonite for them, T.J., if they don't come back and deal with this; 160 million Americans. If Republicans don't deal with this now and don't let those taxes go up, they're going to find out pretty quickly how many electoral votes 160 million Americans represents.

HOLMES: Crystal, you get in there now. Tax issue this is supposed to be the one Republicans win on.

CRYSTAL WRIGHT, REPUBLICAN STRATEGIST: Yes, I think "The Wall Street Journal" got it wrong this morning. The biggest fiasco is Barack Obama's presidency. And now where "The Wall Street Journal" got it half right is that Speaker Boehner and Mitch McConnell, the Republicans just need to get their message together and remind Americans that under President Barack Obama we're sitting in the worst recession since the Great Depression.

That's what they need to hammer home. And Boehner needs to say, hey look, Senate, we passed the bill the payroll tax holiday for a year. You need to work with our plan.

HOLMES: Pete get in there?

PETE DOMINICK, SIRIUS XM TALK SHOW HOST: It's that kind of -- it's that kind of talk that people just nod their heads at, what Crystal just said. I mean, this is -- this is ridiculous. We've entered bizarro -- it's bizarro land. I mean, pretty soon what -- is John Boehner going to fund Planned Parenthood? This is a tax --

(CROSSTALK)

WRIGHT: Obama is Bizarro man.

DOMINICK: A tax cut for working people. And -- and this is -- these are the people, they hate the men more than they love the country; 52 percent of Iowans just answered. They don't even believe he was born here. That's what this is about. This is the tail wagging the dogs.

Seriously, these House members that -- that are leading Boehner, Boehner is not leading them. They're leading him. This is bizarre.

HOLMES: Pete showed up today fired up. I like it.

DOMINICK: It's not even real, let's have a real conversation. People are going to get coal in their stocking for Christmas. Americans at work. HOLMES: Well, let's turn now to Rick Santorum. He just got a big endorsement. Let's go to Iowa here. Where Pete just referenced here. Says his campaign is surging. Everybody is saying that right now. Right, Michele Bachmann, she lost the endorsement that he picked up but she says she's actually the one to watch. Listen to her.

(BEGIN VIDEO CLIP)

ALI VELSHI, CNN ANCHOR: Most polls have you in and around fourth place. These are very fluid polls right now. That is a far cry from where you were in August where -- where really you were thought of as the front-runner in Iowa. What do you think about where you stand right now?

REP. MICHELE BACHMANN (R), PRESIDENTIAL CANDIDATE: Well, that's because I won the Iowa straw poll.

VELSHI: You did.

BACHMANN: The most important election that we've had so far in this race. And now what we're seeing is that after the last debate that was held in Sioux City, we are on a -- we are bullet racing up the charts. The momentum has switched.

(END VIDEO CLIP)

HOLMES: Racing up the charts. Crystal, let me bring you in. Bachmann and Santorum, and of course they're supposed to say this as we get close to Iowa, that they're the ones to surge. Do they have a real chance here?

WRIGHT: I've got to say no. I think Santorum and Bachmann are kind of like Jack and Jill went up the hill. Anything can happen in Iowa right now. It's fluid. But they're not in the top three. And I really just don't see it happening for those two. I think Bachmann, while she won the Iowa straw poll, she's very compelling in debates, she got a strong message like Santorum, but I just don't see it happening for either one of them. I think they're uphill battle here.

HOLMES: Maria, do you agree? Neither one of them have a real chance?

CARDONA: No, I don't agree. And I'm going to say that they do have a chance for three reasons. And I hope I don't pull a Perry here and forget one. The first one is because Iowa voters don't like to be told either through conventional wisdom, momentum or polls what it is that they should decide.

They're going to decide. And a lot of times they go against all three. That's number one. Number two, more than 50 percent of Iowa voters still haven't made up their mind, T.J. So who knows what they're going to be feeling that day when they go into the caucuses to vote.

And number three, I think a lot of them are looking for the anybody but Romney candidate as well as now perhaps the anybody but Gingrich candidate because of all of his baggage.

HOLMES: Pete?

DOMINICK: Listen, first of all, this organization that endorsed Rick Santorum, the family leader, T.J., you and everybody, all of us in the media need to start calling any organization that is named after the family, the Family Research Council, the focus on the family, the family leader, they hate families. They don't like families. They don't like equality. They are bigots.

Rick Santorum really believes this stuff. President Obama fakes it that he's evolving on the gay issue. But we in the media we need to start calling them bigots. They don't think gay and lesbians Americans should have equality. It's called bigotry and that's what we should call it.

HOLMES: Pete, I'm going to have to call you after this segment clearly.

DOMINICK: They wouldn't let you get married in the first half of the century. These people wouldn't let you get married to a white woman.

HOLMES: Well, -- well I'm not. Ok that's another story. I'm going to go to our "Buzzer Beater" for the day now. And I'm going to get some help from Jay Leno on this one, but the President -- President Obama, he's been rising in the polls. And yes, even late night comedians are noticing.

(BEGIN VIDEO CLIP)

JAY LENO, TALK SHOW HOST: President Obama's approval rating actually went up last month to 49 percent. Now let me ask you something. Is it me or does it seem like his ratings go up every time there's a Republican debate? Do you notice that? You know it's like -- it's like voters are going, hey, maybe this guy doesn't suck so bad after all.

(END VIDEO CLIP)

HOLMES: Ok. That's his theory. Maria, what is yours? What's behind the President's jump in the polls?

CARDONA: I think that's part of it because as Americans look at these debates, they really see just how extremist and how far to the right these Republican candidates are and how wrong for the country they are. It's one reason why his poll numbers are rising.

The second reason is the whole tax cut issue and how this President is on the side of the middle class while the GOP especially House Republicans are playing politics and putting their politics before policies that are good for the middle class. And that's helping this President right now.

HOLMES: And Crystal, what do you think it is? WRIGHT: If anybody's extremist, it's Barack Obama and his failed presidency. And you know the fact of the matter is any of the last standing presidential Republican candidates can mop Barack Obama up in a one-on-one debate.

And I think after Americans get out of their holiday stupor, polls go up and then they come down for Barack Obama. Come January 1st they're going to be like why are we voting for the -- why do we support this guy again? He's done nothing for us.

HOLMES: Pete, take it home for us.

DOMINICK: Listen, as long as terrible dictators keep dying and unemployment slowly goes down, nobody's beating President Obama. The sad thing is this -- this lineup of circuit acts that are running, there's one really serious candidate who would be a great president, his name is Jon Huntsman.

And -- and no one even gives him a chance. You know why? Because he doesn't hate President Obama, he doesn't believe that President Obama is a Marxist, socialist who is born in another country. That's why.

HOLMES: Pete --

WRIGHT: No president has gotten re-elected --

(CROSSTALK)

HOLMES: Hey, hey, hey, we got rules here. Crystal we'll forward you another copy, Crystal.

WRIGHT: Ok.

HOLMES: Crystal, Maria, Pete. Really Crystal good to have you here. We hazed you a little bit. It's good to have you here. Thanks so much. And then we'll see you down the road. I'll talk to all of you soon.

CARDONA: Happy holidays everybody.

WRIGHT: Thanks T.J.

HOLMES: Well, we'll have more politics ahead this hour. Coming up at the bottom of the hour President Obama's surge in the polls we were just talking about. We'll be checking in with our political director Mark Preston for his insight into what's causing this new found popularity.

That's coming your way in about 15 minutes from now.

Also, he touched the lives of millions of people since he left the White House.

(BEGIN VIDEO CLIP) BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES: I love this work. Anybody that had the life I've had, anybody that was given the gift that I was given by the American people, you'd be crazy not to do it.

(END VIDEO CLIP)

HOLMES: Our Alina Cho one-on-one with the former president.

(COMMERCIAL BREAK)

HOLMES: Well, as part of our special series, "BIG STARS, BIG GIVING", we shine the spotlight on celebrities who are giving back to causes dear to their heart. It's something that's been near and dear to Alina Cho's heart for quite some time now. She's the one that spearheads this series for us.

We think of -- yes, he's a politician. But there's no doubt, this guy is a celebrity as well.

ALINA CHO, CNN CORRESPONDENT: That's right T.J. I know that you know that I have over the past couple of years interviewed people like Madonna, Elton John, Nicole Kidman, Halle Berry. Well, he is not a Hollywood star, you're right, but he certainly is one of the best known names on the planet.

We're talking about Bill Clinton, the former U.S. President and the founder of the Clinton Foundation. For a decade now as a private citizen he's been using his influence to change the world. The thing is, he says it's changed his life too.

(BEGIN VIDEOTAPE)

CHO (voice-over): No matter where he goes, President Bill Clinton is greeted like a rock star. The man many Democrats called the best president in modern times is working to make the modern world a better place to live.

(on camera): You had it in your mind that you didn't want to spend the rest of your life wishing you were still president.

CLINTON: Yes, that I was still president. I enjoy talking about what happened when I was president. I don't mind telling those stories, but you just need to keep doing something new.

CHO (voice-over): That urge to do something new inspired the former president to open an office in Harlem and create the William J. Clinton Foundation. Today, the Clinton Foundation celebrates what it calls "a decade of difference".

(on camera): 400 million people impacted in 180 countries. When you hear that, do you think to yourself, "Wow, that's incredible" or "Oh, boy, there's a lot more to be done."

CLINTON: Both.

This little pill, because of the discount, will save about 200,000 lives in the world this year.

Driving down the price of AIDS medicine, driving down the price of malaria medicine, building up health care systems that countries can afford to run.

People ask me all of the time well, you're doing more good now. I say, I have to live a long time to do as much for as many people as when I'm in government, when I was in government.

CHO: But you can go places.

CLINTON: But I can go places and do things.

How many sites should we have in Port-au-Prince?

CHO (voice-over): As the U.N. Special Envoy to Haiti, he's visited the country 20 times since 2009. His foundation has raised $23 million towards the rebuilding effort, helped fund programs to fight childhood obesity in 13,000 U.S. schools, established a mentoring program for entrepreneurs; then there's the Clinton Global Initiative.

CLINTON: We wanted to be better.

CHO: Since 2005, the annual meeting has drawn a wide range of people: 150 heads of state; 20 Nobel laureates; everyone from Bill Gates to actors like Matt Damon.

CLINTON: I try to bring people together that know things I don't, who can do things I can't.

CHO: 2,100 commitments have come out of the Clinton Global Initiatives; when fully funded they'll be valued at $69.2 billion.

CLINTON: You are so beautiful.

CHO: Working tirelessly to make a difference, traveling all over the world.

(on camera): 150 countries, more than that. What keeps you going?

CLINTON: I love this work. Anybody that had the life I've had, anybody that was given the gift that I was given by the American people, you'd be crazy not to do it.

(END VIDEOTAPE)

CHO: And, T.J., President Clinton likes to joke that it actually gave him something to do after leaving the White House.

Meanwhile, tomorrow I'll be speaking to actor and comedian Will Ferrell. Of course, fans everywhere know him as the man who makes them laugh. He also just as easily shows a serious side. And he works tirelessly for someone special charity to help cancer survivors.

So I'm very much looking forward to bringing that to you and the rest of our viewers tomorrow. T.J.

HOLMES: And there is the promo as well for this weekend. We can see the entire special on Christmas Eve as well as Christmas day. 2:00 and 4:00 Eastern time, Alina always enjoy seeing those. And I always enjoy seeing you. Thanks so much.

CHO: Ok. See you tomorrow.

HOLMES: All right. Coming up next, everybody has a Christmas wish. This one actually comes true.

You can't beat this stuff. A soldier mom arrives just in time for the holidays. And looky, looky.

(COMMERCIAL BREAK)

HOLMES: All right. I'll give you a look at some of the stories making news cross-country.

Check that out. Jews across the world are celebrating Hanukkah. And a group gathered near the White House last night to light the National Menorah. The tradition dates back to 1979 when President Carter was in office.

Also, be warned. Is this how your stuff is going to be delivered? Video upload -- yes, just toss it right over the gate. That will work this time. This is on YouTube. It shows a fed ex delivery guy tossing of all things a computer monitor over a gate.

This is in southern California. There it is again. The customer posted this on the video. Says, of course, it was broken when he opened it. Fed ex tells CNN it's taking disciplinary action against that employee.

You can't beat this. The little guys are sitting in Santa's lap telling what they want for Christmas and certainly on their list was mommy. And she shows up.

Army Reserve Captain Dawn McCrackin-Bruce surprised her 2 and 4- year-old sons. This was happening at a mall yesterday in Pennsylvania. She had just returned from duty in Iraq.

HOLMES: As we get close to the top of the hour coming up next we're talking about the President's approval numbers. They're actually going up. Why? Our political director has the answer. He joins me next.

Stay with me.

(COMMERCIAL BREAK)

HOLMES: New poll numbers, a good sign for the President and his re-election possibilities. The President's approval rating now at 49 percent. Our senior political editor, Mark Preston joins us now. Mark, 5 percentage points, that's kind of huge in the world of polling. MARK PRESTON, CNN SENIOR POLITICAL EDITOR: It sure is, T.J. And you know, the "Wall Street Journal" has an editorial out this morning where they are critical of the Republican Congress saying that President Obama is, in fact, more electable today than he was a year ago. The reason being is because the "Wall Street Journal", as some Republicans, including John McCain on the situation room yesterday, said that the house Republicans really fumbled the ball on the extension of the payroll tax.

In fact, as we've been reporting all morning and all last night, the House of Representatives has left. They have adjourned for the year. They have not addressed this issue. That is very damming. And in fact, President Obama has been able to benefit from that.

You know, even more damming, let's look at these numbers right here, T.J. That's very interesting and very bad for Republicans as we're heading into an election year. Look how devastating it is right now. Who has more confidence right now, the American voters in President Obama or the Republicans in Congress when it comes to getting some of the major issues done? Look at that, President Obama has climbed six points since march while we've seen the Republicans in Congress drop eight points. Look where they are right now. They are at 31 percent, T.J. Can you imagine?

How bad is that as again, we're heading into an election year. One thing we should point out though, the fact of the matter is we've had several Republican presidential candidates attacking one another alls trying to put out their ideas and ideals. That certainly has hurt Republicans as they're trying to rebuild their brand. When Republicans do finally get a presidential nominee, expect for the Republican Party to come together and expect those numbers to get better. All right. Mark Preston, political director. Do I have it right, political director.

PRESTON: Employed, how about that?

HOLMES: That works for me. We'll have your next political update in one hour. And a reminder for the latest political news you know the spot, cnnpolitics.com.

Next hour CNN NEWSROOM is coming up your way and that's means Suzanne Malveaux is just -- minutes away. $40 a week.

That's how much the gridlock in Washington could cost your family starting January 1 if Congress does not do something and do it in the next ten days.

The clock is ticking on your taxes.

(COMMERCIAL BREAK)

HOLMES: All right. Some stories that will be making use today, At 1:30 Eastern a memorial marking the 23rd anniversary of the bombing of Pan Am Flight 103, that will be held at Arlington National Cemetery.

Then at 2:00 Eastern time police in Maine give us an update about the search for a 20-month-old girl who has been missing since Friday.

Then at 2:00 Eastern as well, the Environmental Protection Agency plans a quote, "significant announcement". They're expected to give new restrictions on mercury pollution in the air.

At 11:00 Eastern time, that's when you get Suzanne Malveaux. She's here now. Used to run around the White House quite a bit. Are you missing all of this that's happening in D.C. right now.

SUZANNE MALVEAUX, CNN ANCHOR: I have to say I like my perch right here covering it from right here.

HOLMES: The calm. It's getting wacky up there.

MALVEAUX: Yes, we'll see how it goes. It could affect a lot of people though.

HOLMES: It is, all right. all right. (INAUDIBLE) it's all yours.

MALVEAUX: Thanks T.J.