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U.S. Deploys Troops, Patriots to Turkey; Rice Drops out from Secretary of State; Machine Could Make Homemade Guns; Potential Bidders for Hostess; States Face Health Care Deadline Today

Aired December 14, 2012 - 09:00   ET

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

DON LEMON, CNN ANCHOR: It works like a printer and makes plastic parts. Now some people are worried it can make plastic guns and the police wouldn't be able to stop it.

Plus this.

(BEGIN VIDEO CLIP)

STEVIE WONDER, SINGER: What's up? How are you doing?

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LEMON: Imagine that, what would you do if Stevie Wonder walked into your recording session?

CNN NEWSROOM starts right now.

Good morning, everyone, from Washington, I'm Don Lemon. Carol is off today. We begin this hour with spiraling concerns over Syria and a desperate regime trying to hold on to power. This morning, Washington announces deploying two Patriot missile batteries and 400 troops to our NATO ally Turkey. The move will bolster defenses against neighboring Syria and its arsenal of Scud missiles and possible chemical weapons.

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LEON PANETTA, DEFENSE ATTORNEY: It's a challenging time. It's a challenging time. It's a critical time. We just announced, I just announced this morning that we are deploying two Patriot batteries here to Turkey, along with the troops that are necessary to man those batteries so that we can help Turkey have the kind of missile defense it may very well need in dealing with threats that come out of Syria.

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LEMON: To CNN's Nick Paton Walsh in Beirut now. He's following the latest developments. Nick is on the phone.

Nick, what can you tell us?

NICK PATON WALSH, CNN INTERNATIONAL CORRESPONDENT: We don't know the exact location where these American troops are going to be stationed but the German parliament has just ratified part of its contribution. There will be three NATO nations giving troops toward this. The U.S., as you just heard, two batteries and 400 boots, the Germans expected to make a similar contribution along with the Netherlands as well.

This is key, though, because it does put NATO forces right in this volatile area. Let me give you the back story how we got to here. About two months ago there were exchanges of fire, the Syrian army accused of shelling areas inside Turkey, causing destruction and injury to Turkish military, firing back, and then subsequently requesting NATO backup.

There was never really any doubt that NATO will come to Turkey. The key thing, though, is that we now have the substantial amount of manpower and weaponry right on the Syrian border. NATO very clear it's purely for defense of Turkey, not meant in any way to enforce what people have been saying might be a no-fly zone there.

But you also heard secretary of defense there, Leon Panetta's comments. Concerns about chemical weapons use and saying to the U.S. does have a plan to respond in the event of that. Not clear if the Patriots will be involved but certainly now in this 21-month-long revolt, we have NATO, the biggest military machinery in the world, in that volatile area -- Don.

LEMON: CNN's Nick Paton Walsh -- Nick, thank you very much.

In Washington now, a withdrawal and a surrender. Ambassador Susan Rice caves to a Republican outcry and drops out of the running for secretary of state. The job seemed to be hers but then there was a deadly attack on the U.S. consulate in Libya.

Days after U.S. Ambassador Chris Stevens and three other Americans were killed, Rice said it was a spontaneous protest that got out of hand rather than a planned terrorist attack. Republicans say she was lying to downplay her boss' failed policies. Rice defends her handling even now.

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SUSAN RICE, U.S. AMBASSADOR TO THE UNITED NATIONS: I was very careful to explain that the information was preliminary, and it could change, and yet I think it was misconstrued and contorted into something much more nefarious that was never indeed the case nor my intention.

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LEMON: Well, the backlash against Rice only grew after she met with concerned lawmakers behind close doors. The odds of a confirmation had grown so bleak the White House never even went through a formal nomination.

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BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I hadn't made a decision about who would be my next secretary of state. There's no doubt that Susan was qualified. There are other people who are qualified as well. Her interest is in serving me, but most importantly serving the country, and she's done an outstanding job. I could not be prouder with her. She will continue to be one of the top members of my national security team.

(END VIDEO CLIP)

LEMON: We're covering all angles with foreign affairs reporter Elise Labott and White House correspondent Brianna Keilar.

Brianna, to you first. The president was vocal in his support. But after two months, do the lack of formal -- formal nomination show a lack of confidence here?

BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT: I think maybe there was a lack of -- I think definitely there was a lack of confidence, that this was a fight that the president wanted to have right now. It's obvious that President Obama has a great affinity for Ambassador Rice. You can see that when he talks about her. He came to her defense in the last month quite a bit but I think there was a lot of concern about the timing and whether this was a fight that he wanted to have.

He has said in his first -- in his press conference following his re- election that if he thought she was the best person for the job, that he would nominate her but he went on to not pin himself in, not to make a decision, and some of the critics who were in the corner of Susan Rice say that this may have actually sealed her fate. She ended up heading up to Capitol Hill trying to defend herself against her role immediately following what happened in Benghazi and trying to explain that on behalf of the administration.

When she went up to Capitol Hill to meet with lawmakers those visits very much backfired. They raised a lot of questions and she was there to try to answer them and try to assuage concerns, and they had the opposite effect. That was especially true with Senator Susan Collins of Maine, a Republican, but a moderate, and that was something that was really seen as very troubling in all of this process.

Some critics will say, Don, that without the nomination, she was left twisting in the wind but there's also this sense that President Obama has a whole lot on his plate. He's obviously involved in this fight over the -- striking a deal on the fiscal cliff and then going into next year, a lot of goals obviously to follow on that entitlement reform, spending cuts, tax reform and don't forget immigration reform is also a priority. So I think that there was a sense that, do you really spend all of this political capital on this fight when there's so many other things to do?

LEMON: Yes. And so she referenced that as well in her letter that she put out yesterday.

Elise, you cover the State Department. Who's on the shortlist to be nominated here? John Kerry of course, right?

ELISE LABOTT, CNN FOREIGN AFFAIRS REPORTER: Well, Don, he's really the only name on the shortlist. Senator Kerry as the chairman of the Senate Foreign Relations Committee has a lot of world stature, he has a lot of relationships with world leaders and in the past he's really done a lot for President Obama. If you remember, he -- when John Kerry was running for president in 2004, he gave then Senator Obama his first kind of shot on the world stage at the Democratic convention.

He's also been President Obama's partner in terms of prepping for the debate. And he served in as Mitt Romney, and also Senator Kerry has also done a lot of work for the administration in terms of troubleshooting around the world. This is a guy who got Afghan President Hamid Karzai to agree to a runoff election. He should -- often meets with the Pakistanis whenever there is a problem. He's even met with Syrian President Bashar al-Assad at one point.

And so he's really seen as -- although Susan Rice was seen as someone who could have been the president's first choice he's certainly a candidate that is up to the task and has a lot of foreign policy credibility around the world -- Don.

LEMON: Elise Labott and Brianna Keilar, thanks to both of you.

Some other stories we are watching for you right now. When it comes to the fiscal cliff still no deal and now the debt ceiling is caught in the crossfire here. Specifically a part of the White House's fiscal cliff plan that would give the president the power to increase the debt limit without Congress, that is. Boehner making it clear that it is not up for a debate.

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REP. JOHN BOEHNER (R), HOUSE SPEAKER: Do you think that Senator Reid or then Senator Obama would have ever given to President George W. Bush the unlimited ability to raise the debt limit?

Look, I know they're talking about doing it now. Do you think there's any chance that Senator Reid or then Senator Obama would have done that? Zero. Congress is never going to give up our ability to control the purse.

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LEMON: So for President Obama's part, he is digging in as well on an area that has been key sticking point and that's taxes.

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OBAMA: The most important thing we can do right now is make sure that middle class taxes do not go up. That's the best thing for the economy, best thing for American families, and if we do that, Senate's already passed this bill. House Democrats are ready to pass it. I'm ready to sign it. The only holdouts right now are the House Republicans.

If we get that done that will take the edge off things. We'll still have to deal with some deficit and debt problems. But it means 98 percent of Americans and 97 percent of small businesses will not see their taxes go up. We should get that done. (END VIDEO CLIP)

LEMON: Well, the House is scheduled to go home for the year today but House majority leader Eric Cantor says members could be working longer with the fiscal cliff still unresolved.

Do you know this man? It could be worth $5,000 to you. The FBI is hoping the reward will lead to an arrest of a robber who has hit 13 banks from Virginia to California. He's being called the "Ray bandit" because of his big glasses, his big sunglasses, and differing disguises.

And a funny moment from the Cincinnati Bengals-Philadelphia Eagles game. Look at that. The helmets of the Bengals' Andre Smith and Eagles' Brandon Graham got stuck together. The ref, well, he had to help separate hem. Graham chuckled about it. You know, the woeful Eagles didn't have much more to laugh about in this game. They had five turnovers and lost to the Bengals 34-13.

And two 11-year-old boys, that trophy they're holding is 13,000 years old, 13,000 years old. The cousins from Troy, Michigan, were scouring a creek when they stumbled across a bone from a Mastodon, an elephant- like beast that vanished 10,000 years ago. By the way, today they share it with classmates. They're calling it the coolest show-and- tell item ever.

You can make part of a semiautomatic rifle using a 3-D printer. Lawmakers fear it's just a matter of time before people start making homemade guns.

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LEMON: Checking our top stories for you right now. We have new video of the crash that killed Dallas Cowboy Jerry Brown Jr. It's led to a manslaughter investigation against his teammate Josh Brent seen on the right. 911 tapes show witnesses frantically calling for help when the crash happened early Saturday morning near Dallas.

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UNIDENTIFIED FEMALE: Is it s anybody injured?

UNIDENTIFIED FEMALE: I don't know. I just drove past it, it looked like it just happened, there was a car upside down and there was smoke everywhere.

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LEMON: Well, Brent was arrested and accused of driving drunk. Family members say he and Brown were best friends.

The mall in Oregon where a shooting rampage took place will reopen in just a few hours. It's been a crime scene since Tuesday when police say a man shot and killed two people in a rampage and then killed himself. Several mall workers say they're hesitant about returning to that mall. Attorney General Eric Holder facing harsh criticism from a top Republican after failing to pursue criminal charges against HSBC. The bank admits violating federal laws by laundering money on behalf of countries like Iran, Libya and Myanmar. In a letter to Holder's office, Republican Senator Chuck Grassley calls the lack of charges a declaration that, quote, "crime does pay." The Justice Department did not comment but defends its nearly $2 billion settlement with the bank.

Two Massachusetts Costco workers are splitting a $50 million Powerball prize. Rosa de Leon said she buys two tickets every day and shares them with her co-worker Reginald LeBlanc. On Wednesday, the tickets finally paid off. The two will each get $11 million after taxes.

Congratulations to them. Very lucky.

There is a machine that could one day be used to make homemade guns. Not only that, it could make plastic guns that a metal detector won't find. So, you can believe some people are worried about it.

Here is CNN's Joe Johns with more.

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JOE JOHNS, CNN CRIME AND JUSTICE CORRESPONDENT (voice-over): At this northern Virginia gun store, you can buy all sorts of weapons. But what if you can make weapons like these in your own home, using what's called a three-dimensional printer? Sounds like science fiction, but to some, it's not so far-fetched.

Take this recent episode of "CSI".

UNIDENTIFIED MALE: Primarily, 3-D printers are used to manufacture parts for antique cars and design prototypes.

TED DANSON, ACTOR: And you think our killer printed a gun?

UNIDENTIFIED MALE: Multiple guns. Identical, disposable, untraceable.

JOHNS (on camera): And it could also be undetectable. Three-D printers like this make solid objects from digital models and plans. And what's manufactured could be all plastic, like this little gadget with all these moving parts that work together perfectly.

So, a plastic gun manufactured with this technology might not necessarily be picked up by your garden-variety metal detector at an airport or a public building. It's a potential game changer in the gun control debate.

CODY WILSON, STUDENT, UNIVERSITY OF TEXAS: We're trying to produce guns with this technology.

JOHNS (voice-over): Advocates of the so-called printable gun, like University of Texas student Cody Wilson, see it as a rights issue. WILSON: I believe in the universal access to arms, and I want to show you, as far as it's possible for me, that this thing will be completely unable to be regulated.

JOHNS: He's behind Defense Distributed, a nonprofit organization dedicated to creating what Wilson calls the wiki weapon, a firearm with a design that can be distributed on the Internet and manufactured using a 3-D printer. He's already built part of an AR-15 using the technology.

Democratic Congressman Steve Israel has taken notice.

REP. STEVE ISRAEL (D), NEW YORK: I just want to make it impossible for people to use three-dimensional printers to manufacture gun components, which was done, and in fact, six bullets were fired from these components.

JOHNS: That's why Congressman Israel is pushing to renew the Undetectable Firearms Act, a law passed a quarter of a century ago, banning plastic firearms, that will expire next year.

ISRAEL: It just defies common sense, safety, and logic to make it easier for terrorists and criminals to manufacture the components of guns, which can be brought onto our airplanes and into our federal buildings.

JOHNS: The National Rifle Association says it views this legislation as unnecessary. Pro-gun advocates say, to date, no one using a 3-D printer has manufactured a working firearm completely out of plastic.

One 3-D printing expert says it might not even be possible anytime soon.

KEVIN ARMENTROUT, ABC IMAGING: I don't feel like this technology is going to be there next year. But in my estimation, we have some time and ways to go to get there.

JOHNS: And Wilson worries about the chilling effect on new ideas.

WILSON: What does Mr. Israel say? Well, we should prevent the development of a whole branch of technology. Well, that's ridiculous.

JOHNS: Joe Johns, CNN, Washington.

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LEMON: Don't count the Twinkie out just yet. We'll tell you which big name companies may be bidding on Hostess, the iconic snack-maker.

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LEMON: If you thought Twinkies and Ding Dongs were gone for good, there's still hope. Two familiar faces have emerged as potential bidders for the now bankrupt Hostess Company.

Maribel Aber following the story from the NASDAQ market site. Maribel, who are the potential buyers?

MARIBEL ABER, CNN CORRESPONDENT: Good morning, Don.

There's still hope. According to Bloomberg, there are about two dozen bidders, Wal-Mart and Kroger are said to be in the mix here. Other first round bidders reportedly include Grupo Bimbo, they're the owner of Arnold and Bubbly Bread, and Alpha Baking Company.

Now, it's just talk right now, Don, but this is exactly what we expected. The maker of Twinkies and Ding Dongs is in the process of liquidating. So, that means the company can be chopped off and then sold off in pieces. And since Hostess is bankrupt the pieces come at rock bottom prices.

So, that really makes Twinkies an attractive buy, Don.

LEMON: Oh, certainly does. So, what's the likelihood, Maribel, that these brands will survive?

ABER: Well, you know what? Pretty good. There's still value in the Hostess brands. We're talking Twinkie, Ding Dongs, Ho Hos. You know, before they went under, the company has upwards of $2 billion in annual sales. So, there's still a market.

The problem with Hostess was their cost structure. They had plants spread across dozens of states, and not exactly efficient and the companies said labor costs were a major issue. But the products, those will likely live on and we might be seeing that start to play out.

Don, I want to throw out it here, too, the last batch of Twinkies hit stores in Chicago this week. The lines, they were out the door. In Wednesday, they were all sold out.

LEMON: Maribel, thank you very much. Appreciate it.

A critical day for health care reform as states decide to take part in a key portion of President Obama's Affordable Care Act. We'll explain how it could affect you.

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LEMON: Good morning. I'm Don Lemon.

The stories we're watching right now in THE NEWSROOM:

Opening bell to ring soon on Wall Street, we should hear it any second. Stocks are set to open higher today following news that manufacturing is picking up in China. Gains are expected to be modest, though as the fiscal cliff issue remains unresolved. Opening bell soon on Wall Street.

The U.S. is showing its support for Turkey in the face of potential threats from Syria. The U.S. military will deploy two Patriot missile batteries and 400 troops to Turkey in the coming weeks. NATO and Turkey say the Patriot missile system would be used only for defense.

President Obama is speaking out about marijuana for the first time since Colorado and Washington state legalized it. He told ABC's Barbara Walters he discourages drug use and regrets doing it as a kid, but says it's not a top priority for the feds to prosecute recreational users in states that have legalized the substance.

We're awaiting word on the next round of fiscal cliff negotiations. President Obama and House Speaker John Boehner met just under an hour at the White House late yesterday afternoon. Still, though, no deal.

Aides for both men describe the session as frank and say the lines of communication will stay open.

The law of the land -- that's how House Speaker John Boehner described the Affordable Care Act. It was a signature issue of President Obama's first term, one that overhauled the nation's health care system and today marks a critical milestone in the implementation of that act. States must decide whether they will set up their own exchanges which will require residents to select a health care plan.

Our senior medical correspondent Elizabeth Cohen joins me now with more on this.

Elizabeth, what are the exchanges and how do they work?

ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: Don, an exchange, simply put, is you go online and you buy insurance because the whole point of Obamacare is every American is supposed to be insured by the time this is done.

So let's take a look at the basics of the exchanges. It's for people who are not getting their insurance through their employer. And the providers, the insurers, have to take you. They can't tell you no because they have a preexisting condition and they can't charge you more, which is a huge change from the way it is now. And you'll get a subsidy to help you buy that insurance if your family makes under approximately $92,000. That's for a family of four.

Now, you were referring to who is going to run these exchanges? So, let's take a look at a map. This map shows the states in green have basically told the federal government, we want to you do it. You guys organize these and run these. The states in white are going to run their own exchanges on their own or they've teamed up with other states -- Don.

LEMON: All right. Elizabeth Cohen, thank you very much.

Joining me now is Joel Ario. He's the former director with the Department of Health and Human Services and currently managing director of Manatt Health Solutions.

Joel, you also worked as insurance commissioner in Pennsylvania and Oregon. So, from your experience, you say there are a few reasons why states should set up the exchanges. What are they? JOEL ARIO, MANAGING DIR., MANATT HEALTH SOLUTIONS: Well, Don, I think there are two main reasons and they relate to programs that states have traditionally managed themselves. The first is the commercial insurance markets states have for more than a century now managed their own commercial insurance market and that means since the health care really became a big deal in the 1950s, states have primarily been in charge of that market. The exchanges fit into that market and if states maintain control over the exchanges, they then have a coordinated enforcement and implementation of laws across the commercial marketplace.