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Weakest Holiday Sales in Three Years; Netflix Blames Huge Outage on Amazon; Egypt's Constitution Passes; Officials: First Insider Attack by Woman; Winter Storm Delays Holiday Travel; A Year of Extreme Weather; Los Angeles Gun Buyback Began Today; Congressman Claims Disconnect in NRA

Aired December 26, 2012 - 14:30   ET

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


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VICTOR BLACKWELL, CNN ANCHOR: Retailers were hoping shoppers will spend big today. Early figures show holiday sales slumped to the lowest levels in three years. Alison Kosik is live at the New York Stock Exchange.

Alison, every time I drove by the mall, the parking lot was full. Every time I went in one, there were people everywhere. So what is behind the weak sales this year and can post Christmas shoppers really turn things around now?

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: And you make really good points there, Victor. You know, analysts are telling us there are two big factors at work here. First of all, Hurricane Sandy, hit holiday shopping right when it was beginning to rev up in early November.

And then in the past few weeks, those worries about the fiscal cliff they took over everybody's pocketbooks. You know, people are really worried about their taxes going up. So what do you get? You get holiday sales not doing too hot.

Spending polls are saying holiday sales are up a little less than 1 percent. It actually winds up being the weakest growth in three years. Now keep in mind, it is still early. These numbers are still rolling in. But, you know what? They're not a good sign.

You know, after Christmas spending, it could help a little bit, but because of limited -- but because of limited -- there could be limited returns in the Christmas shopping because a lot of people get gift cards and they do their returns.

What retailers are hoping for is when people get into the stores do the returns and to shop for gift cards, maybe people will spend a little more on their gift card and maybe exchange instead of just returns -- Victor.

BLACKWELL: OK, so we've got the sad trombone for the holiday shopping results. Combine that with the fiscal cliff fears, we're six days away, how is Wall Street reacting?

KOSIK: Wall Street is pretty quiet today. There is low volume again, which means not a lot of investors are in the game today. That's because partly because of the fiscal cliff and partly because people are on vacation. And expect that to be the case for the rest of the week.

This is usually a time of year when we can get Santa Claus rally. Investors like to put the icing on the cake and push stocks up anywhere from 1 percent to 2 percent on average, but no deal on the fiscal cliff. Well, that's spoiling the rally so far.

Though, you know what? It could be worse. You know, we have seen much bigger negative reaction to all these congressional shenanigans in the past. Could be a sign the economy is in better shape this time around. You just look at the S&P 500, Victor, it's still on track for a 13 percent gain for the year. That's as we look at all the red on the screen -- Victor.

BLACKWELL: A lot of red there is. Red and green, a holiday pictures, wish we had more green. All right, Alison Kosik, thank you.

If you weren't able to watch your favorite Christmas classic on Netflix, we know why. The video streaming service is blaming a massive outage at one of Amazon's web service centers. They say it happened on Christmas Eve.

Now, Netflix has millions of subscribers in the U.S., Canada, Latin America, most folks have service up and running again by Christmas Day, though. If they missed it going into Christmas, they can watch it in the evening. One Netflix official says they're looking at how to prevent something like this from happening again.

Russia is trying to put the brakes on Americans adopting Russian children and today that ban is one step closer to becoming law. Details are next.

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BLACKWELL: Egypt's president, Mohamed Morsi, has signed a decree putting into effect the country's new constitution. Voters approved the Islamism-backed constitution, but it was bitterly contested and left the country polarized.

Critics say the document was thrown together and does not include the voices of liberals and Christians, and other minorities. Now that the country has a constitution, Morsi is expected to give up the sweeping powers that he gave himself. U.S. officials stress there is a need for more consensus and it is time for Morsi to make compromises.

It is being called the first insider attack in Afghanistan by a woman. A NATO contractor was shot dead by an Afghan policewoman on Christmas Eve. The shooter was arrested and we have more details about her identity.

Let's get that from Barbara Starr at the Pentagon. Hi, Barbara. What are we learning about this woman and this attack?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Victor, all we know so far really is what the Afghans are saying. There was a press conference with senior afghan ministry spokesman and he held up a very interesting passport. He says the passport of this woman and it is Iranian, that she is an Iranian citizen who came to Afghanistan and married an Afghan man.

He also said she had some fake identity documents, but this is certainly raising the prospect that the shooter was Iranian. So far, however, no indication yet she's tied to the Taliban, that she is officially tied to Iran at this point, or to any terrorist groups.

By all accounts she came to Kabul, police headquarters had a weapon hidden under her clothing, removed it, said she was looking for someone to shoot and walked out behind this U.S. contractor. He's now been identified as 49-year-old Joseph Griffin of Mansfield, Georgia, Victor.

He was working for Dime Corp. International, a major U.S. firm working in Afghanistan to help train those Afghan police -- Victor.

BLACKWELL: Barbara, this is notable because it is the first woman who made this inside attack. Are we seeing a trend as it relates to this type of attack, more of them, less of them frequently?

STARR: Well, you know, throughout this year it is really been on the upswing at various points. We haven't had anything in a few weeks. Now this tragedy, for an American family, but it has pretty much been a problem throughout the year with U.S. coalition.

And it should be said Afghan officials, Afghan troops also getting killed. Infiltrators, Taliban supporters, people with grudges, it has been the whole gamut of things.

The NATO alliance has been really trying to work the problem and provide more protection for troops. They believe some of their efforts are working, but in this case it did not -- Victor.

BLACKWELL: Certainly, did not. Barbara Starr at the Pentagon for us, thank you.

Hundreds of American couples trying to adopt children from Russia are being -- bracing for bad news. A law banning Americans from adopting in Russia has been approved by Russia's upper House of Parliament.

And now all that is need is President Vladimir Putin's signature and that's expected to happen. Russia has long been one of the top countries for U.S. adoptions.

The move is seen as payback for recently signed U.S. law, which puts financial restrictions on Russians accused of human rights violations and bans them from traveling to the U.S.

Well, from one of the hottest and driest summers, you remember it, to Superstorm Sandy.

(BEGIN VIDEO CLIP) UNIDENTIFIED FEMALE: It was scary. It was so scary. It reminds you of the Wizard of Oz when the tornado hit and everything is going around and around.

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BLACKWELL: Heat waves, wildfires, tornadoes, the top ten weather events of 2012 right after this.

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BLACKWELL: We are monitoring severe weather from the Midwest to east coast. It is delaying travelers in several states now. It is a live picture as one of our crews is now driving down the Pennsylvania turnpike. This is near Bedford in the southern part of the state.

To be sure, just so you know, no one is driving and shooting. This is a steady camera in the car and this is Indiana. Live pictures from Indianapolis, in fact. Our meteorologist says the winter storm is headed to the Carolinas and on up the northeast region.

We always have cases of wild weather, but 2012 really brought weather we hoped we would never see again. Chad Myers counts down the top ten weather disasters of the year gone by.

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CHAD MYERS, AMS METEOROLOGIST (voice-over): Number ten, April 15th.

DON LEMON, CNN ANCHOR: Tonight, millions of people throughout the Midwest are batting down.

UNIDENTIFIED FEMALE: In a second, the whole house was gone. We were looking up at blue sky.

MYERS: Seventy five tornadoes ripped through the Midwest causing nearly $300 million in damage. Number nine, Tropical Storm Debby.

UNIDENTIFIED MALE: Tropical Storm Debby, this is what happens when you get hammered by as much as two feet of rain.

MYERS: The storm never developed into a hurricane, but it did leave up to 28 inches of rain in Northern Florida. Number eight, summer heat wave, sweltering heat baked the nation this summer. March and July set U.S. records as the hottest of all time. Number seven, western wildfires.

UNIDENTIFIED FEMALE: My God, smoke in the air.

MYERS: The heat wave helped fuel a string of wildfires that chard the west. Colorado experienced two of the state's largest and most destructive wildfires ever. Number six, the deratio in June.

UNIDENTIFIED FEMALE: It began in Iowa, moved through Illinois, Indiana, Ohio and moved into Washington, D.C. it took a fast moving long lasting violent thunderstorm complex. MYERS: After charging 800 miles, 22 were dead and 5 million were without power. Number five, the Dallas 22. There is an old myth that tornadoes don't hit big cities. April 3rd proved otherwise when twisters hit Dallas.

UNIDENTIFIED FEMALE: It was scary. It was so scary. It reminds you of the Wizard of Oz when the tornado hit and everything just going around and around.

MYERS: In all, 22 tornadoes caused a billion dollars worth of damage in 24 hours. Number four, deadliest tornado. Tornadoes took up three spots in our top ten countdown, but this event was the deadliest. March 2nd and 3rd, 70 confirmed tornadoes killed 40 people in the Midwest.

Number three, Hurricane Isaac. Hurricane Isaac descended on Louisiana Tuesday night, nearly seven years to the day that Hurricane Katrina struck. Isaac wasn't such a monster, but it was still a killer.

The country held its collective breath as the levees were tested yet again. In the end, the new levees saved New Orleans, but Plaquemines Parish was devastated by flooding. Number two, the drought that rivalled the dust bowl.

All of those big rivers, all very dry this year. By September, 66 percent of the U.S. was in some degree of drought. The dry weather is expected to continue into 2013 and this could become the costliest natural disaster in U.S. history. And number one, Superstorm Sandy.

UNIDENTIFIED FEMALE: Historic superstorm made landfall over the most populated areas of the United States. Wind damage, power outages, storm surges, inland flooding, even snowstorms are threatening the lives and homes of people from Virginia to Massachusetts.

UNIDENTIFIED MALE: I've never seen devastation like this in my life.

UNIDENTIFIED MALE: The surf getting much, much more violent.

UNIDENTIFIED MALE: Curfew is under way right now. You are not to be on the streets.

UNIDENTIFIED MALE: They're keeping an eye on the possibility of flooding.

ANDERSON COOPER, CNN ANCHOR: Superstorm Sandy has crippled the nation's biggest transit system.

UNIDENTIFIED FEMALE: Talking about flooding, possible power outages, that could last for days.

UNIDENTIFIED MALE: From the city to the country side, people just need to be self-aware.

MYERS: The storm killed at least 113 people in the U.S., and caused tens of billions of dollars in damage. Total repairs will take decades. Chad Myers, CNN. (END VIDEOTAPE)

BLACKWELL: Be sure to join our Don Lemon for the biggest stories of the year in crime and politics, money, even the most scandalous. The top ten of 2012 will air Sunday night 8:00 Eastern.

A House Democrat says there is a disconnect between the National Rifle Association and its members and he plans to use that so-called disconnect in pushing gun reform. He joins me after the break.

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BLACKWELL: In Los Angeles, the annual gun buyback program begins today. The no questions asked event was moved up several months because of the Newtown school massacre. Earlier on CNN, L.A. Mayor Antonio Villaraigosa responded to critics who questioned the effectiveness of gun buyback programs.

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MAYOR ANTONIO VILLARAIGOSA (D), LOS ANGELES: Well, there are experts say we should have an assault weapons ban, we shouldn't -- that we should continue this amendment that prohibits us from doing what we should do to enforce our gun laws. Those same experts pooh-pooh virtually everything we try to do and this is a great opportunity for people to get involved themselves and not wait on Washington.

I'm supporting Senator Feinstein's assault weapons ban. We have one in California. You can buy guns, assault weapons in Arizona and bring them here. You'll get arrested, but they do that as well. We need to toughen our laws with our gun shows.

Forty percent of all the guns that are purchased don't require a background check because they're purchased from private sellers. There are a number of things we can do this is just one of them. It's not the only thing, we got to also address the culture of violence we have in this country.

Too many people think it is just OK to shoot people and the way you see too often in this country. For those of us who got to watch the NRA commercial last week, the notion that more guns in the hands of good people will prevent gun crimes just isn't borne out by the facts. This is an opportunity for people to get rid of guns they just don't need.

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BLACKWELL: That was L.A. Mayor Antonio Villaraigosa. We'll have a live update from L.A. in just a few minutes. Let's stay on the subject of guns and what to do about them.

Congressman Jim Moran says there is a disconnect between the National Rifle Association's leadership and the NRA members. The Democrat from Virginia is pushing a package of gun reforms he says most NRA members support.

And Representative Moran joins me now live from Washington. Sir, it is good to have you with us.

REP. JIM MORAN, D-VIRGINIA: It is good to be with you, thank you.

BLACKWELL: Congressman, when many politicians think about the NRA, they think about this legion of people who stand shoulder to shoulder with Wayne Lapierre and the leadership and what he says they believe. You believe, though, that the NRA leadership is out of touch with the membership. Why?

MORAN: Well, this bill that we're introducing on the first session of the next Congress has five measures where two-thirds of NRA membership support them. In fact, in some cases one of them is supported by 79 percent of the NRA members.

So I do think there is a disconnect between the NRA members and the gun manufacturers who basically pay the salaries of the NRA leadership. But what this would do is to require background checks, not only for gun purchaser, purchasers, but for gun shop employees.

It would require people that are on the terrorist watch list not be able to buy firearms or explosives. The GAO just did a study that showed 1,321 people are on the terrorist watch list attempted to buy firearms and explosives.

And 91 percent of the cases the FBI was powerless to stop them. It would also require that if you're going to get a concealed carry permit that you have certain minimum requirements like age and some training lessons.

And in addition, it would say that you have to report within 48 hours if your gun is lost or stolen, 600,000 guns are stolen from private homes every year. So this is basically the lowest hanging fruit. It is really ripe for legislative passage and I would hope it might get some traction.

BLACKWELL: You picked the five because there is a poll over the summer by a GOP pollster that says these are not only things that are mildly supported by NRA members, but they are in the 60, 70, 80 percentile of support from the membership.

MORAN: That's exactly right. These are common sense gun safety measures. I think it would give some greater credibility to the NRA to support what the vast majority of its membership is willing to do. I don't expect them to, but I would hope we get some bipartisan support for this common sense measure.

It is not going to solve the problem. It is not going to put an end to the mayhem and massacres, but it will be progress. And we're going to do what we can up here on the Hill, who believe that, you know, young innocent children shouldn't be slaughtered because we have failed to do our job.

It really does seem we're at the point if the Congress fails to do anything, particularly in response to the Sandy Hook Elementary School massacre that we are complicit in further massacres of innocent people because we haven't made sufficient effort to even do what the majority of NRA members would be willing to do.

BLACKWELL: Let me jump in here. Though you're pulling here that you got from the GOP pollster says one thing that NRA members will support, the leadership when it comes to 2014 and the primaries they will be the ones who will drop the hammer if there are people who vote in support of it.

If there are Republicans who vote against what the NRA says that should or should not happen, right? So the leadership will be the ones that divvy up the money to attack some of the Republicans in Congress, right? Isn't that the important part of the conversation?

MORAN: I do think that that's been the problem, certainly up until now. It has been the political intimidation that they really will go after you if you cross the NRA leadership. Also the majority of the people that -- who are in the majority and the Congress, 51 percent of them, get money from the NRA, but I think the main leverage that they have is this political intimidation.

But somehow we have to stand up to it. What's the point of saving your political career if it means the loss of such innocent lives as were -- as were massacred at Sandy Hook and will continue to be if we don't take action.

I mean, there has got to be a line where we're willing to draw it, and we have to ask ourselves is our political career of greater value than the lives of those young children.

BLACKWELL: Congressman Jim Moran, Democrat of Virginia, thank you for speaking with us this afternoon.

MORAN: Sure.