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American Morning

Crippled Cruise Ship Towed to Port; Obama Under Fire for "Weakening Dollar"; Night Owls Vs. Morning People; Chocolate Shortage Could Cause Prices To Go Up; Debt Commission Leaks First Draft of Report; 50 Best Inventions of the Year

Aired November 11, 2010 - 08:00   ET

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


(COMMERCIAL BREAK)

ALI VELSHI, CNN ANCHOR: And a very warm good morning to you. It is Veterans Day, Thursday, November 11th. I'm Ali Velshi, filling in for John Roberts.

KIRAN CHETRY, CNN ANCHOR: I'm Kiran Chetry. Glad you're with us.

We have a lot to talk about this morning. So, let's get right to it.

They're going to be home soon -- thank goodness. Passengers that were onboard a crippled Carnival cruise liner, they thought they were going to a restful vacation. And they ended up going for a little bit drama after the engine fire left the ship powerless, 4,500 people stranded -- still in the Pacific Ocean.

President Obama under pressure at the G-20 Summit under way in Seoul, South Korea. His plan is to revive the U.S. economy coming under fire. And there's a new development this morning: a deal in the works between the U.S. and South Korea that could mean 70,000 new jobs for Americans is on the ropes.

CHETRY: Also, what gives? The commission created to seriously tackle the deficit is out with its list of what needs to be cut. The recommendations could seriously impact your bottom line, from your retirement, to your taxes, to what you're able to write off. We're breaking all of it down this morning.

VELSHI: But up first, their long vacation nightmare is nearly over. Right now, passengers onboard Carnival Splendor say they can see the California coastline. Five tug boats are towing it to shore. The ship was stuck in the Pacific Ocean powerless after an engine failure.

CHETRY: Yes. The passengers had no hot water, no hot food, and for a time no working bathrooms.

CNN producer Paul Vercammen is following the developments.

(BEGIN VIDEOTAPE)

PAUL VERCAMMEN, CNN PRODUCER: Executives with Carnival Cruise Line say that their disabled cruise ship Splendor will be pulled by tug boats into San Diego harbor at some time around midday. That's on Thursday. Carnival also promising those passengers aboard the disabled ship that they will get full refunds, that they will be put up in hotels if they need to, that some of them will be shuttled to Long Beach where many of them have parked, others who flew in from other parts of the condition will be flown out of San Diego.

In the meantime, the USS Ronald Reagan played a big role in helping out the ship while it was out at sea. Well, that vessel is back on maneuvers today. But as you can imagine, after airlifting some 60 palettes of food, supplies, water and the rest onto the cruise ship, this was quite a different mission from many of those pilots who have been supporting U.S. troops in places like Iraq and Afghanistan.

COMMANDER TAMARA GRAHAM, NAVY HELICOPTER PILOT: It's very rewarding. What we do, obviously, there's goods and bads when you're in the middle of warfare and doing your job, but this is an all an upside. We're helping out people that are in distress. It's an opportunity, actually, to improve the lives of a lot of folks that were in dire straits.

So, it's great. It's a great opportunity.

VERCAMMEN: The aircraft carrier pilots dropped some 60 palettes of water, food and other supplies on to the carnival ship. Now, who's going to pay for all of this? Carnival is going to pick up the costs of the supplies while the U.S. Navy is going to pay for the fuel, the aircraft and the rest.

Paul Vercammen CNN, Coronado, California.

(END VIDEOTAPE)

VELSHI: At the G-20 Summit in Seoul, South Korea, it looks like President Obama is taking on the world. The far cry from how these things looked a couple of years ago when the whole world was coming together. The president attended a working dinner with world leaders this morning and they have been bashing his plan to pump $600 billion of new money into the American economy -- a plan the finance minister of Germany has called "clueless."

CHETRY: Also, what exactly is the G-20 Summit?

We'll get more now in an A.M. extra. It's a yearly meeting of the finance ministers and central bank governors from 19 countries and the European Union. The G-20 nations represent 90 percent of the world's economic output, 80 percent of the world's trade, and two- thirds of the world's population.

VELSHI: Dan Lothian is traveling with the president. He joins us live from Seoul this morning.

CHETRY: And, Dan, the U.S. and South Koreans have been working on the big trade deal, set to possibly bring thousands of new jobs to America. What is the latest with that?

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: That's right. Seventy thousand jobs to be exact and the president says pump $10 billion into the U.S. economy.

This was something that the White House had really hoped that they could get locked down here at the G-20. They said they had been making significant progress on this, but it's not going to get done here. The president is hopeful that it will get done in the next few weeks and not months.

Sticking points is opening up the South Korean market to U.S. beef and also auto imports, as well. They've been negotiating on this right down to the last minute. And at one point, they had thought that perhaps they could get it done. But they realized that there weren't enough hours really to get this hashed out.

This is critical because, again, the president has been looking increasingly overseas to create jobs back at home and this particular trip to four Asian countries is a focus of the administration on Asian markets where U.S. goods can go and then create jobs back at home. And this president has been getting a lot of pressure, as you know, back at home because stimulus simply has been not creating the jobs that everyone expected.

VELSHI: Dan, there's an also report out there. Let's talk about what's going on in the United States. A report out that White House adviser David Axelrod is suggesting this administration is ready to accept an across-the-board continuation of the Bush-era tax cuts, something the president had said in the campaign up to the midterm that he was not interested in doing. He was only going to extend for the middle class.

What are you hearing about this?

LOTHIAN: Listen, the only reaction we are getting here from the White House to that is simply that there's nothing new here, that the president has been saying now in recent days that he's open to compromise on this issue.

White House deputy communication director Jen Psaki put this statement out, saying, quote, "The president has been clear that extending tax cuts for middle class families is his top priority and he is open to compromise to get that done. He has also expressed concern about the cost of making the highest income tax permanent and is looking forward to discussing this and other issues with bipartisan congressional leaders next week."

Ali, as you know, the president has talked about how this upper tier Americans, tax cuts for them, extending those tax cuts, would cost America about $700 billion. He says that's something that simply cannot afford and that's the reason he's been against this. But the administration is signaling that the president is willing to negotiate on this issue in order to get this moving forward.

CHETRY: All right. Dan Lothian for us this morning -- thanks.

Also signs of progress toward putting the alleged 9/11 mastermind Khalid Sheikh Mohammed on trial. Attorney General Eric Holder said yesterday that administration officials are close to a decision on the trial's location.

(BEGIN VIDEO CLIP)

ERIC HOLDER, ATTORNEY GENERAL: Process is an ongoing one. We are working to make a determination about the placement of that trial. And I would hope that whenever the decision is, it would be one that will be judged on the merits, and that what is best for the case and for justice in that case will be the thing that will guide the decision.

(END VIDEO CLIP)

CHETRY: Holder's initial plan was to try Mohammed and other 9/11 suspects in New York. That plan was then put on hold after New York officials and some members of the Congress objected to that.

VELSHI: OK. This story's been with us for a few days. It was a mystery plume over California that baffled everyone from the Pacific all the way to the Pentagon. Remember this? It looks like what you'd see after a vapor trail from a rocket and the end of it, there's an illuminated thing. It looks like a thruster or something that looked like fire.

This morning, we've got answers. A Pentagon official saying there's no question it was condensation trail from an airplane. He said there's no evidence to suggest streaks were a missile or anything else.

Now, I'm no scientist, but I looked to that pretty closely. And there is something at the end of it that doesn't look like plane. A plane is not usually bright at the end of a vapor trail. But --

CHETRY: They say that it was a combination --

(CROSSTALK)

VELSHI: -- the Pentagon says that, we have to believe it.

CHETRY: They say it was a combination of the way that the sun was setting, the clouds, the optical illusion.

VELSHI: Yes.

CHETRY: But the thing that made it a three-day story is that -- I mean, we had Chris Lawrence was on yesterday and the Pentagon wouldn't say for sure what it was when this first happened.

VELSHI: Right. I think if they're going to say for sure if it was a plane, they should tell which plane it was. I mean, I'm not a conspiracy theorist. I don't think somebody was sending rockets up there. But I looked at it and it looked interesting to me.

CHETRY: To a lot of other people, as well.

VELSHI: Yes.

CHETRY: All right. Well, it fell the wrong way. This was a demolition that went the wrong way. Smokestack in Springfield, Ohio and there you see it falling. It was clearly not supposed to fall on those wires and it came smashing down, almost came down on a group of spectators that included children. You can actually hear people screaming in the background as they ran to get out of the way.

The 275-foot tower snapped power lines, crushed part of a power substation. There were no injuries. But the traffic lights were out, 8,000 people in the area lost power.

VELSHI: So, would you -- give me this. I know people go out and look at these demolitions. If the thing is 275 feet, then nobody should be closer than 500 feet.

CHETRY: Right.

VELSHI: You know?

CHETRY: No.

VELSHI: Stay far away.

CHETRY: They shouldn't.

VELSHI: Because it can go the wrong way.

All right. Coming up next: this is a shocking, shocking story. There's even video of it. A high school boy's basketball coach is being sued by his players for allegedly whipping them with a belt. We'll show you the video. We'll talk to one of the boy's fathers and their lawyer -- coming up.

Also ahead: from the world's first recreational jet pack --

VELSHI: This is cool.

CHETRY: -- to wall paper to deflect a bomb blast or perhaps protect you from an earthquake.

VELSHI: Right.

CHETRY: We're going to look at some of "TIME" magazine's picks for the best new gadgets --

VELSHI: I like the jet packs.

CHETRY: -- and breakthroughs. Now, we know what to get you for Christmas -- coming up. Ten minutes past the hour.

(COMMERCIAL BREAK)

VELSHI: We've been looking carefully at some shocking video this morning. It's grainy stuff on a cell phone but you take a look and a listen and tell me what you think.

(VIDEO CLIP)

VELSHI: OK. Here's what it allegedly is. It's allegedly a high school basketball coach whipping a player for blowing a play in practice. This is happening at Murrah High School in Jackson, Mississippi. Parents have now filed a lawsuit against the school district.

We're waiting to see what happens to the coach. Reports say he is now on leave.

Joining us now is Jason Hubbard, his 15-year-old son is a sophomore at Murrah and was allegedly one of the players hit. Hubbard's attorney, Lisa Ross, is also with us. She's representing a number of the students involved in the lawsuit.

Welcome to both of you.

Jason, let me start with you. First of all, that's not your son in the video, is it?

JASON HUBBARD, SR., SAYS SON WAS WHIPPED BY BASKETBALL COACH: No, sir. It's not.

VELSHI: All right. What did you -- according to you, what happened? What did your son tell you happened?

HUBBARD: Well, I was actually there on the 22nd of September in the practice. And that was my first time observing the hits or the whippings from the coach. And I immediately felt very bad and went home and told my wife about it and talked to her about it. And she was upset and disappointed in that.

And after that, I went back to practice again Sunday evening and I didn't see anything because I had stepped out of practice. But I saw it again on Monday evening, which gave me great concern for our boys.

VELSHI: So, he did this knowing there were parents around, knowing that there were adults around?

HUBBARD: Yes, sir. Yes, sir.

VELSHI: This is fascinating. This is -- he used -- what was it? A belt? I can't tell from the video.

HUBBARD: It was a weightlifting belt.

VELSHI: And what was the reaction from the kids getting hit?

HUBBARD: Well, some -- the ones that wasn't getting hit at the time, they were laughing and joking, and the ones that were getting hit, I know they felt bad. I can see the content of their face, and it was very, very disturbing to me to watch them be humiliated like that.

VELSHI: Lisa, let me just read the coach, his response to this. Coach Dorsey says, quote, "I took it upon myself to save these young men from destruction of self and what society has accepted and become silent to the issues our students are facing on daily basis. I'm deeply remorseful of my actions to help our students."

I don't know what Marlon Dorsey means by that. But tell me from a legal perspective -- is what we see on the video, what we see on the cell phone video, is that legal?

LISA ROSS, ATTORNEY REPRESENTING PLAINTIFFS: We believe it's illegal, and it was unlawful for the coach to hit these students. In this particular case, the students had engaged in no misconduct. They had done absolutely nothing wrong except run a basketball play incorrectly. And we believe that it's unlawful for any teacher to hit a student merely because the student ran a play wrong.

VELSHI: Jason, your son apparently was whipped himself, but he didn't tell you because he was afraid he might get kicked off the team. Your wife encouraged you to go talk to the principal. How did that conversation go?

HUBBARD: He and I and my wife talked in our bedroom one night, and I asked him why didn't he tell me earlier? His words were, I thought I wouldn't get on the floor to play during the game. And that was very disturbing at the time because we have great relationship with our kids, my wife and I. And just about anything that they know or we know we talk about it.

And the fear of not playing was very disturbing -- they had to trust in the coach and when -- having that trust went a little bit too far with the kids putting fear into them. And for them to take abuse like that, I thought it was very unfair, but the conversation that we had with him, he confessed that the whippings did hurt, and he only took them because he had to take them to play.

VELSHI: Lisa, how many students are you representing? How many students do you think were actually hit?

ROSS: I'm representing three different young men who play on the basketball team. And we believe that a majority of the players on the team were hit. One of my clients was hit almost daily and sometimes more than -- he had the punishment administered to him more than once daily during the practices.

VELSHI: what are you going to be satisfied with? Are you looking for damages out of this or do you want the coach disciplined or fired?

ROSS: Well, we want the coach disciplined. We want compensatory damages for the unlawful touching of my clients. And we want Jackson Public Schools to teach their coaches that -- not to act like Coach Dorsey. We do not want students being beat just for an opportunity to participate in a sporting activity.

VELSHI: Lisa Ross is an attorney representing plaintiffs against Coach Marlon Dorsey. He's an assistant coach Brandon Sanders and the principal Frederick Murray at the Jackson Public School District. Jason Hubbard is the father of one of the boys who was beaten or allegedly was beaten by that coach with a weightlifting belt. Thanks for joining us.

All right. It is 18 minutes past the hour. And we are going to be right back.

(COMMERCIAL BREAK)

VELSHI: Love a little Eminem in the morning.

CHETRY: Yes. This is your theme song. Guess, who's back? It's you.

VELSHI: I love being back. Why is it we want to have casual chat? We come and sit in these formal things really far apart from each other?

CHETRY: I'm not even going to face you.

VELSHI: You know, we're close talkers, right? Both of us.

CHETRY: I know.

VELSHI: We both lean in

CHETRY: I know this feels very odd. But I'll tell you why. It's because we need to show the video here.

VELSHI: Love it.

CHETRY: And the story we're talking about is night owls versus morning people. There's a new study suggesting that if you like to stay up later, that's when you feel like you're at your best, you actually have a higher IQ, but it's not all good for you because if you are that type of person as opposed to an early riser --

VELSHI: Studies say.

CHETRY: Study says it's going to be less reliable. You see, early risers work harder and get better grades.

VELSHI: I was a bit surprised. I would have guessed in the survey, I was going to shift (ph) as an early riser as opposed to a night owl. I was right on the brink, so are you.

CHETRY: Me too. Slightly more of an early riser than a night owl, but right in the middle.

VELSHI: Right. Do you think that we should be scoring very high in the early riser to be doing the show? Whatever.

If you got a sweet tooth, this is not going to be sweet news for you. The price of chocolate could be going up. The main reason, more farmers in West Africa have given up on planting cocoa trees because they take up to three years to mature and growers earn less than a dollar a day selling that cocoa to big corporations.

CHETRY: Well, Miranda Lambert shining bright on country's biggest night. She walked away with three of the top awards at the 44th Annual CMA. It was her 27th birthday, as well. She also won for Video of the Year and Album of the Year, and it was all the more sweet because her honey is also country music star, fiance, Blake Shelton. And so, it was a great night for her all in all.

VELSHI: And the Entertainer of the Year award went to Brad Paisley. Zac Brown Band won Best New Artist.

We all saw Wolf Blitzer dance on "Ellen." Apparently, the R&B community wasn't as lucky. Wolf Blitzer was a guest announcer last night at the most soulful night in entertainment, the Soul Train Awards in Atlanta. We understand he's also up for Reggae Artist of the Year. You know, he's big. I'm kidding. He's not up for Reggae Artist of the Year.

CHETRY: Poor Wolf. But he did, you know, he brought it. He talked about how much he loves Soul Train growing up. And so, this show is going to air on November 28th. And, we're going to show you a little bit of Wolf on the red carpet.

(BEGIN VIDEO CLIP)

WOLF BLITZER, CNN ANCHOR: It's a surprise. I really can't talk about it too much because the audience is going to be pretty happy when they see what I'm going to do, but it's going to be a lot of fun. It's not exactly in the "Situation Room." It will be a little different. Different side of Wolf.

I've just grown up in Buffalo, New York. And I remember vividly Saturday mornings watching Don Cornelius and all my favorite groups whether the (INAUDIBLE) or Gladys' night, Jackson 5. They were all there. All the kids were dancing. We had a lot of soul.

UNIDENTIFIED FEMALE: Yes.

BLITZER: It was very, very cool. And that's why I'm here because Soul Train, you know, was part of my life.

(END VIDEO CLIP)

VELSHI: Just never going to grow old listening to Wolf in that voice say --

CHETRY: We've got a lot of soul.

VELSHI: Yes. I love him. I love Wolf.

CHETRY: We all love Wolf. He's awesome. And he's off the treadmill now.

VELSHI: Right.

CHETRY: He's probably not watching. VELSHI: I can do my Ellen imitation dance of him again.

CHETRY: Good.

VELSHI: All right. I might do that.

CHETRY: Do you ever say it's on like Donkey Kong?

VELSHI: I don't.

CHETRY: I don't either, but if you do say, you may own Nintendo. The company that created the iconic video game is trying to trademark that phrase. The whole move might just be a plot to promote the new Donkey Kong video game. It may or may not be. Who knows? The Wii, it's coming out in a few weeks.

VELSHI: I mean, that's a good effort to do that. I say I Google things regardless of how I search for them. And I knew Google would prefer --

CHETRY: That's right. And you say, can I gate Kleenex even if you're using facial tissue.

VELSHI: But I don't say it's on like Donkey Kong. Well, maybe somebody does.

Listen, we love money, we hate paying bills. That's obvious. So, how do you cut about $4 trillion from the federal deficit? Trick question. A plan is in the works, but what is going to take the biggest hit? Something's got to be cut. Christine Romans is going to tell us about it after this break.

(COMMERCIAL BREAK)

CHETRY: We got some breaking news right now. This is live pictures. These are live pictures as the carnival cruise ship "The Splendor" is now making its way into San Diego harbor. You may remember this is the ship that suffered from an engine fire, left it powerless back on Monday and stranded the 4,500 passengers and crew out there in the Pacific Ocean. Took five tug boats to finally pull this cruise ship. I think it's about 100 miles out in the ocean.

VELSHI: Yes. And then they had to get food put on to the ship. They sent the pop tarts and --

CHETRY: Spam.

VELSHI: And Spam for a while. The toilets weren't working on there. The air conditioning wasn't working. Not a terrible deal because it wasn't overly hot. But entering a cabin, it can get a little bit hot. Carnival offering passengers refunds and a free cruise in the future.

CHETRY: It's going to be pretty costly, actually, for Carnival because they had to get the USS Ronald Reagan to get out there and deliver some 60,000 pounds of food. VELSHI: But what we've seen with cruises where not a lot goes wrong on cruises, but if they act -- it's still a very, very popular way to travel, and if the cruise companies act fast, it saves their reputation. What happens, particularly, when there's --

CHETRY: Norovirus.

VELSHI: Yes.

CHETRY: When everybody was getting sick.

VELSHI: And when it was taking them a while to act, they were seeing massive cancelations, but truly, when I watch this happen, I think to myself, I'm a guy who'd like to go on a cruise. That's not going to make me not want to go on a cruise because it's, A, it happens so rarely, and B, they did take care of them.

CHETRY: Right.

VELSHI: We talked to a woman earlier who said she thought they handled it quite well.

CHETRY: Yes. And she was going to take them up on their offer to get to do it again. Meaning, cruise, not be stranded.

VELSHI: Not stuck. Yes.

CHETRY: So, there are the pictures again. The Splendor, Carnival Splendor being tugged back into San Diego harbor.

VELSHI: We don't have close-up (ph) at this point. It's supposed not to see on a camera in the dark.

CHETRY: Yes. And we're probably going to see people start to disembark at some point.

VELSHI: Yes.

CHETRY: So, we'll bring it back to you live when we get a little closer to it.

VELSHI: OK. President Obama starting two days of talks with leaders of the world's most powerful economies and some of the world's fastest growing economies. This is the G-20, group of 20 Summit in Seoul, South Korea. Security, obviously, very, very tight. More than 50,000 police officers are deployed. Wide-spread demonstrations are expected between now and tomorrow.

The president is already taking a lot of heat for the Federal Reserves' plan announced last week, QE-2m we've been calling it to infuse the U.S. economy with $600 billion in brand-new money.

CHETRY: All right. And today is Veterans Day. It's the day that we pause to remember those who have served our country bravely and nobly through the generations. And today, President Obama is also honoring Veterans Day in South Korea. He paid tribute to the men and women who served in the military called the Korean War. So, a victory for freedom.

And now, you're going to be looking at live pictures from Arlington National Cemetery where in just about two and a half hours, 11:00 a.m. Eastern time, Vice President Joe Biden will be laying a wreath at the tomb of the unknowns.

VELSHI: Drastic measures for desperate times. President Obama's bipartisan deficit commission out with their plan to slash trillions of dollars from the federal deficit. Nothing is off the table. This is the important part. From job cuts to Social Security, even to moving the retirement age, pushing it back.

CHETRY: Yes, and some changes to write-offs that businesses and individuals have come to expect and rely on. Our Christine Romans joins with us a breakdown of the plan, and it is only a proposal. It has to make the way through Congress and approved by a majority of people on the commission.

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: This is the first move in a chess game to go on for a long time with very high stakes that affects every one of us, every soldier, every educator, every man, woman, child, retiree in the country. All of these things affect you.

So let's talk about what's on the table here. We're talking about $14 trillion in red ink. This is the backdrop for everything that you're going to be hearing over the next days and months about how to get the country's finances in order.

There are 12 zeros on there, $14 trillion. That's how much money the country has already spent and hasn't paid for. And we have deficits basically as far as the eye can see.

So what is this commission recommending? They're recommending getting rid of some very popular tax breaks in exchange for a more simple tax code where there are only three tax rates for us, and those tax rates are lower. Eliminating or scaling back the home mortgage deduction is one of those things, a sacred cow that's right out there for people to talk about.

Also, at the gas pump, a 15-cent increase in the gas tax to help pay for highway improvements and the transportation fund. So that will be out of your pocket, a 15-cent increase in the gas tax.

Here's something on Veterans Day no less to be talking about big, huge lasting cuts to the American military. Cut defense spending by $100 billion. And cut the number of military bases overseas by a third. There's an awful lot in there. It's more than just targeting waste and abuse in many of these agencies including the Department of Defense. It goes well beyond that in talking about significant cuts in just about every part of the government that you can imagine.

VELSHI: This is a proposal, a blue ribbon commission.

ROMANS: Right.

VELSHI: It was highly expected. Do we know whether this is likely to go forward?

ROMANS: It is the draft of the proposal.

VELSHI: Right, right. The real proposal comes out December 1st.

ROMANS: This is the first move in the chess game. And 14 of the 18 members of the commission have to agree. And then that proposal moves along to Congress and goes from there. Congress can write legislation, can change legislation. What is coming out is not binding.

CHETRY: People are already speaking out, including the House speaker Nancy Pelosi and others.

ROMANS: You're hearing more from the left than the right. You haven't heard from conservatives crying yet about cuts to the military and some of these tax changes, but you have heard from the left, Dick Durbin, for example, he hates this like a priest hates holy water. They're very --

VELSHI: The devil hates holy water.

CHETRY: I think the priest likes it.

VELSHI: Oh my gosh, Christine. Step away from the desk before we all get hit with lightning. That will wrap up the report for the morning.

ROMANS: I have to back away. But Nancy Pelosi said that this was absolutely unworkable for her, this plan. But the president in South Korea said let's not shoot down anything yet until we read it because we have some big choices to make

VELSHI: As you mentioned, one of the places to take a hit is Pentagon, $100 billion hit quite possibly.

CHETRY: We bring in Pentagon correspondent right now, Barbara Starr. You got a chance to talk to General David Petraeus about this, and we were emphasizing again this is a proposal. But what is he saying about it?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: I don't actually know that General Petraeus has seen the proposal yet, but the Pentagon knows about this. And they know that they are right in the crosshairs right now.

Defense Secretary Robert Gates has already made defense spending one of the signature issues. He wants to cut $100 billion. But he wanted to reinvest that money in things he believes the troops needs. Now they're talking about just applying that to the deficit.

So how is this all going to work? And really, this is a political crosshairs. Gates is expected the leave next year. Republican majority coming in. Does he lose his mojo? And will anybody pay attention to what he wants to do now? And a central issue is, as Christine points out, military health care. The cost has doubled in recent years. Gates has wanted to get a handle on that. The Republicans are not likely to let him do anything to try to raise the cost of health care to the troops.

ROMANS: Right here in the proposal it says reform Tri-Care for life to increased cost sharing to military retirees. That sounds like putting more of the cost on retirees for the health care. Tri-Care is something that is --

STARR: You want to talk about holy water.

(LAUGHTER)

Raising the cost of health care to the troops and families is one of the -- there's just no way to say how sensitive that is.

(CROSSTALK)

ROMANS: They even took it out of health care reform, took it out because they didn't want to worry -- didn't want to worry the veterans and retirees and active military. And now it is back on the table.

CHETRY: This is a fight that they're not going to give up easily.

VELSHI: This is not an easy solution. Barbara, thanks, so much. Christine, as always, thanks very much.

CHETRY: The world's recreational jet pack, the first one out there --

VELSHI: That is fun. Look at that. How can that not be fun? Who doesn't want to do is that that? I would do it in a place with more space.

CHETRY: And more padding. Anyway, wallpaper that can deflect a bomb blast. These are "TIME" magazine's best picks for the gadgets and breakthrough ideas that you're even my sweet little baby here -- not my children but my iPad. It is on the list. We'll be right back.

(COMMERCIAL BREAK)

VELSHI: Just seeing how this looks on the wall.

CHETRY: This is one of the best --

VELSHI: Every year "TIME" magazine selects the 50 best inventions of the year, things that really push the envelope and can change the way the way we live.

CHETRY: That's right. This year we have jet pack. We have an iron man suit.

VELSHI: Excellent. CHETRY: A flying car, just some of the remarkable innovations.

And Radhika Jones is the assistant managing editor at "TIME" and she's here to show and tell us about them. Thanks for being here this morning.

RADHIKA JONES, ASSISTANT MANAGING EDITOR, "TIME" MAGAZINE: Good morning.

VELSHI: Jet blast wallpaper.

CHETRY: X-flex blast protection. Tell us about this one.

JONES: This is what you want on your walls if you might be getting bombed, if you live on a fault line, you might having an earthquake. It's basically it's a strengthening wall paper, literally sticks on, bonds with a wall and makes it so much stronger that it's hard to even destroy it with a wrecking wall.

VELSHI: It adds to the structure?

JONES: Yes.

CHETRY: This is how thin it is. There is Kevlar woven into this.

JONES: It's amazing. Doesn't come in Martha Stewart colors but you stick it on the wall and the wall is much stronger. It was developed in partnership with the Army Corps of Engineers and considering it for U.S. bases overseas.

CHETRY: That's a smart idea. Also we were wondering if it would help in places that are earthquake-prone. We saw the devastation in Haiti and also in our west coast.

JONES: Exactly, it seems like it would. And they're looking to develop a civilian model in the next couple of years.

VELSHI: All right. Yesterday, I spoke to a woman who had been paralyzed for 18 years from the waist down in a skiing accident. And she has one of the devices that you talk here, E-legs Exoskeleton. She was able to walk and we were walking and talking. That's a remarkable invention, I think.

JONES: Yes. You have just said it all. The psychological lift, let alone the actual lift for someone who's in a wheelchair to be able to get up and walk. It's basically the crutches read arm gestures and signal to the robotic legs, and then they -- that simulates the human gait. It is an amazing step for anyone confined to a chair.

CHETRY: It sure is.

This is one that's probably the ubiquitous which is the iPad. People say, wait a minute, Ali was a skeptic. You took the iPhone and added some tablet pc --

VELSHI: A tablet pc. I'm not a big buyer of that invention.

CHETRY: Why are they buying?

JONES: You can take a picture with it. I've stopped being skeptical of Steve Jobs. When he says something is magical, I believe it. The iPad, people did the tablet computer before. This is a device that's beautiful. It's addictive. It's not so much that we need it but we want it. And that I think is Apple's big secret.

VELSHI: Let me talk about the one I want, and that is the jet pack. I don't know what it's officially called, the Martin jetpack. You call this the most anticipated invention. I think we are anticipating since we watched "The Jetsons."

JONES: Exactly. You can't talk about the inventions of the year without checking in on the jet pack. And it seems like it is closer. It looks like two leaf blow earls harnessed together, not terribly confidence inspiring but it can get people up to 8,000 feet and I think it runs for about 30 minutes.

CHETRY: Besides the fact you're a boy at heart.

VELSHI: I want one tomorrow.

CHETRY: What would you use it for?

JONES: Fopr 8,000 feet in the air. The same reason I want a gator to drive around property I don't have. I'm a boy.

CHETRY: I got it. Now I get this one.

There is another one that's really cool that a lot of people love. This is the plane that can land anywhere, right?

VELSHI: Fascinating.

CHETRY: This is awesome. It's so cool we're going to take a break and come back and talk to the inventor of this plane, as well.

VELSHI: A plane and a car.

CHETRY: A plane and a car. There it goes. How cool could you be? Radhika Jones, assistant manager for "TIME" magazine, thanks so much showing us these. It's great to have you.

JONES: Thank you.

CHETRY: We'll be right back.

(COMMERCIAL BREAK)

(COMMERCIAL BREAK)

ALI VELSHI, CNN GUEST ANCHOR: Look at that. That is very cool.

KIRAN CHETRY, CNN ANCHOR: This is one of the top inventions this year. We are taking a look at the best inventions courtesy of "Time" magazine.

VELSHI: Our next guest Carl Dietrich is the co-founder and CEO of Terrafugia, he's part of the team that designed this flying car. Joining us from Los Angeles, let me just tell you a little about Terrafugia before we talk to him. It's -- it's -- it's a street legal and air-worthy vehicle. It costs about $200,000, which is less than a Lamborghini.

First models will be delivered next year, it gets about 35 miles per gallon on ground and drives at about 65 miles an hour and it fits in a standard garage and it's an airplane. I mean, honestly. Do you think that -- I'm a boy. I like that.

CHETRY: Yes. How did you think of this one, Carl?

CARL DIETRICH, CO-FOUNDER & CEO, TERRAFUGIA: Well, I'm a pilot and this vehicle really directly addresses the problems that pilots face on a daily basis. In addition, it has a potential to really kind of change the way people think about traveling between 50 and about 400 miles on a regular basis.

VELSHI: So tell me how this works. You -- you drive, you get out of you house in the morning and you get in to this car. How many people does it seat?

DIETRICH: It seats two people. And yes, it drives down the road just like a normal automatic transmission car. You drive to the nearest airport. You unfold the wings in less than a minute. You go around and do your pre-flight inspection. You take off. Fly to the airport nearest your destination and fold up your wings in less than a minute and drive right to the door of where you want to be.

CHETRY: That is amazing.

DIETRICH: So it really does make better use --

CHETRY: Right.

DIETRICH: Yes. It makes better use of the network of 5,000 public airports around the country.

VELSHI: And it uses regular gas. What -- regular meaning automotive gas as opposed to jet fuel.

CHETRY: How hard -- and how hard is it to learn how to fly?

DIETRICH: Well, actually, there's a new type of pilot's license that you can get right now that takes half the time and half the money of the traditional pilot's license and it has some restrictions on it but you can get it in as little as two weeks.

CHETRY: Whoa.

VELSHI: How safe --

DIETRICH: And that would qualify you to operate this.

VELSHI: Don't go flying with somebody who got it in just a little of two weeks, I would recommend. Carl, how -- how safe is this -- let's just carry on that because how safe is this both as a car and as a plane?

DIETRICH: Well, that's -- that's one of the things that we feel very good about is Terrafugia is really setting the highest bar in the industry for safety. We're bringing automotive technology which is advanced so much within the past 30 years to the general aviation industry, which is a pretty old industry, actually.

So we're doing things like simulated crash testing. We've got safety cages, crumple zones, airbags, all those things that you find in a modern car today we're bringing them to light aircraft. And in addition to all of that, we have a rocket-deployed parachute system that can bring the entire vehicle down under a parachute.

CHETRY: Wow, so this is the first models will be out next year. How -- how are you envisioning this? Or what -- who's the market for this when you -- when you envision it?

DIETRICH: The market primarily is pilots or people who are willing to become pilots in order to have the freedom and flexibility of operating this sort of vehicle. And it really does address a lot of the problems that -- that -- that segment of customers face on a regular basis. You know, if you wind up commuting more than an hour a day, you might want to think about something like this. And taking the time and learning to become a pilot in order to operate this sort of vehicle.

CHETRY: So, Ali could fly from Atlanta --

VELSHI: I -- I'm all over the place.

CHETRY: -- drive and fly from Atlanta on a daily as part of his daily commute.

VELSHI: I fly to Philly, I fly here. I mean, I could -- this would be perfect for me, a little gift for me.

CHETRY: Yes, I was just thinking of what --

DIETRICH: Yes, we've an employee who commutes an hour and a half each way and so this -- we keep joking this is -- we're making his vehicle. This is perfect for him.

VELSHI: That really is great.

Carl, thanks so much for joining us. What a great invention, congratulations.

Carl Dietrich is the co-founder and CEO of Terrafugia, the Terrafugia Transition is what this car is going to be called. A flying car, fantastic.

CHETRY: It fits in a standard garage.

VELSHI: Yes.

CHETRY: Wings unfold. Pretty cool. Carl, thanks so much.

Well, one of the other top inventions this year is the Iron Man suit and it's designed -- designed to give soldiers super strength. You'd be able to put it on and you can actually lift 200 pounds without breaking a sweat. It could help if you had to -- you know, of course be in a war zone or your --

VELSHI: Wow look at that.

CHETRY: -- and need to have ordinance, do other things. There it is.

Well, our Chris Lawrence got a firsthand look at just how this Iron Man suit works.

VELSHI: That's not Chris, right?

CHETRY: It may be.

VELSHI: I don't know.

CHETRY: Either that or he's standing back and saying, I could do this with one hand. Check out the report tonight on the "SITUATION ROOM" with Wolf Blitzer right here on CNN.

VELSHI: All right, we're going to take a break. When we comeback I want to give you some weather. There's snow in the Rockies and it is beginning to move east. Are you in its track? We'll tell you when we come back.

(COMMERCIAL BREAK)

CHETRY: What a pretty shot.

VELSHI: It is.

CHETRY: Don't you wish you were there?

VELSHI: I'm right there. This is out our window basically. I'm happy to be back.

CHETRY: I'm just teasing you because you weren't that excited about the Miami tower cam.

VELSHI: I love Miami. I just -- I just feel like we're compelled to say nice things when we put a picture up. CHETRY: That's gorgeous. The sun is out. It's going to be sunny all day, 45 right now, 54 a little bit later. What a day for a walk in the park, perfect autumn afternoon.

VELSHI: I love -- I love autumn. How's it looking in the rest of the country?

CHETRY: I don't know. There's Rob Marciano. Hey.

ROB MARCIANO, AMS METEOROLOGIST: Sorry you know. There's -- you know, a lot of stuff going on here.

CHETRY: What are you guys doing?

MARCIANO: Could somebody turn that monitor down? I don't know. They are setting up for the big 9:00 hour. You know, it's Fredericka Whitfield.

CHETRY: Hey you've got six more minutes to pay attention to us.

VELSHI: What is going on? Sounds like a fight going on over there.

FREDRICKA WHITFIELD, CNN ANCHOR: Who needs a --

MARCIANO: Settle down, Fredricka. We'll get to you in about five -- she's filling in for Kyra Phillips. And it's going to be an exquisite couple of hours. So keep it tuned right here.

Meanwhile, a record warmth across part of the eastern half of the country and some cold temperatures; 15 degrees to 20 degrees below average is what's expected across parts of the Rockies. There were snow in Denver and maybe a couple of inches there.

And then a little rain, ribbon of rain trying to make its way up towards Chicago. This is riding along a front that's kind of stalled. Also, a little bit of the flow off of Lake Erie causing some fog across parts of northern Ohio this morning and in through parts of Detroit, as well. Warm air bumping into some of that cooler, moist air.

Rockford, Illinois, 70 degrees yesterday -- that's a record; Waterloo, Iowa, 69; Minneapolis getting into it, 68; Lacrosse, Wisconsin seeing temperatures get into the upper 60s. And we'll see some more of those numbers as the heat pump continues from the Gulf of Mexico.

Not going to quite get to New York. Temperatures for you folks will stay right about average, but still very, very pleasant at 56 degrees; 61 degrees expected in D.C.; 77 in St. Louis; and 69 in Chicago.

Santa Ana winds will begin to blow later on this afternoon. T- minus 4 minutes and ten seconds until the 9:00 hour.

VELSHI: All right. MARCIANO: Not that I haven't loved the past 2:55.

VELSHI: Great to see you as always, my friend. It is four minutes as he said to the top of the hour.

(COMMERCIAL BREAK)

CHETRY: Well, Jay Leno loves to talk about us at times here on AMERICAN MORNING. And yesterday was no exception. He liked our take on a particular story. So here's what he did.

(BEGIN VIDEO CLIP)

JAY LENO, TALK SHOW HOST: During Obama's trip to India, Press Secretary Robert Gibbs got into a confrontation with Indian officials. They refused to let American reporters into the press conference and he put his foot in the door and he really had a confrontation with the guy outside. Take a look. Here's Gibbs.

JOHN ROBERTS, CNN ANCHOR: White House press secretary Robert Gibbs had to get a little rough with security in India. It happened while the president was meeting with India's prime minister yesterday. Indian officials tried to allow only five American journalists into the meeting instead of the previously agreed upon eight. That's when Gibbs put his foot down.

LENO: Yes. That's right. That's right.

(END VIDEO CLIP)

CHETRY: Didn't happen quite like that.

VELSHI: That's not how he did it on TV?

CHETRY: No.

VELSHI: Ok.

CHETRY: But that was quite colorful.

VELSHI: It was. Any mention's a good mention.

CHETRY: Exactly. It was nice to have you with us today.

VELSHI: It's always a pleasure to be with you. Thanks for having me back.

CHETRY: And your show, 1:00 Eastern time, live from New York as well or are you going to take that jetpack.

VELSHI: I'll stay today. I'll be doing it from here. Thanks a million.

CHETRY: Yes, absolutely.

That's going to do it for us. Right now, the news continues with Fredricka Whitfield. Hey, Fred.