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ERIN BURNETT OUTFRONT

Dow, S&P Close At Record Highs; U.S. Expresses Regret Over India Arrest Incident; Sochi Picks Send Message To Russia; ; President Obama Suggests Transparency in Government Surveillance; President Barack Obama versus Russian President Vladimir Putin; "Duck Dynasty" Star Calls Homosexuality a Sin; Interview with Will Ferrell

Aired December 18, 2013 - 19:00   ET

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


JAKE TAPPER, CNN ANCHOR: Next, was it really necessary to arrest and strip search an Indian diplomat? Secretary of State John Kerry weighs in on what has become an international incident.

Plus, will President Obama scale back the NSA spying program?

And, "Duck Dynasty" under fire. Was the show's star being offensive or just true to his religious beliefs?

(MUSIC)

TAPPER: Good evening. I'm Jake Tapper, in for Erin Burnett.

We're going to get to our top story in just a minute.

But, first, the big news out of the markets. The Dow rose more than 292 points. The S&P 500 rising by nearly 30. Both closing at record highs. You can see the spike there at 2:00 p.m. Eastern Time. That's when the Federal Reserve announced it would start cutting its stimulus program. The process dubbed tapering by Wall Street.

It's something investors have long been waiting for. It's a big sign that the fed thinks the economy is slowly but surely improving. Fed Chairman Ben Bernanke told reporters that an improved outlook for the job market was one of the big reasons the fed chose to start tapering.

Now to our top story, a show of remorse from America's top diplomat to India, John Kerry expressing regret for the strip search of an Indian diplomat after she was arrested in New York on visa fraud charges. The incident has caused an international uproar with the Indian government retaliating against the U.S. The White House today trying to diffuse the situation.

(BEGIN VIDEO CLIP)

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: Thus far, all indications are that standard procedures were followed because we recognize that this is a very sensitive issue in India, we are continuing to review exactly what happened in this case.

(END VIDEO CLIP)

TAPPER: Deborah Feyerick has more on the allegations against the Indian diplomat.

(BEGIN VIDEOTAPE)

DEBORAH FEYERICK, CNN NATIONAL CORRESPONDENT (voice-over): As she left the Indian mission in New York City Wednesday, Devyani Khobragade offered no comment. The deputy console general was charged with making false statements on a visa application she submitted on behalf of her nanny. According to the criminal complaint, the diplomat said the nanny would be paid a minimum wage of $9.75 an hour. Instead the nanny said she was paid just over $3 an hour. That is three times less than New York's minimum wage. However it is about three times more than what the average domestic in India makes.

DANA SUSSMAN, NANNY'S LAWYER: The allegations are that the -- Dr. Khobragade lied to the federal government in order to obtain an A-3 visa to bring her domestic worker here with no intention of paying the required wages for the hours she requested. Our clients who work as domestic workers are living in the home with their employers. If they leave, they not only leave their legal status. They leave their only source of income. They leave the only home that they've known in a foreign country. This is more than a labor dispute.

FEYERICK: The diplomat was arrested near her daughter's Manhattan school and handed over to U.S. Marshals. She was strip searched and put into general population with alleged criminals. She was given no special status since the charges related to her personal life and not her consular functions.

MARTINA VANDENBERG, PRO BONO LEGAL CENTER: Once you hand over someone to the Marshal Service, they are being arrested and there is no door for rich people and no door for poor people. Everyone is arrested and equal before the law in the United States.

FEYERICK: Martina Vandenberg has been tracking alleged diplomatic and consular abuse cases for the last decade.

VANDERBERG: So what's different about this case, the State Department and the Department of Justice stepped up and they actually took these allegations, investigated them thoroughly and decided that they have enough information, enough evidence to indict the case.

FEYERICK: According to the criminal complaint, the 39-year-old agreed to pay nanny $4,500 a month. However, a lawyer for the diplomat said that figure was Dr. Khobraghade's salary, not the nanny's.

DAN ASHACK, KHOBRAGHADE'S LAWYER: She will be completely vindicated.

FEYERICK: Lawyers for both the diplomat and the nanny said attempts to resolve the dispute financially were unsuccessful.

(END VIDEOTAPE)

FEYERICK: Now charges against Devyeni Khobraghade come after a five- month investigation by the State Department and the U.S. attorney here in Manhattan in June after working for the family for about eight months, the nanny decided that she was going to leave. She went to an immigration lawyer. She is currently in New York. She is staying with friends. She has no passport. The U.S. government has given her a temporary legal status, which means she can stay here and she work until this is resolved -- Jake.

TAPPER: Thank you, Deborah Feyerick. International correspondent, Mallika Kapur is in New Delhi tonight with the reaction there. Mallika, will Secretary of State John Kerry's comments do anything to quell the outrage?

MALLIKA KAPUR, CNN INTERNATIONAL CORRESPONDENT: Well, India is just waking up to news that Secretary of State John Kerry had called the national security adviser here to express his regret. Will help calm tensions? I think the feeling is there is a hope that it will calm tensions because up until now, India has been really, really angry. India has been seething at the treatment handed out to its diplomat in New York saying that it was absolutely humiliating, completely unaccepting.

We saw protesters take to the streets outside the embassy here in New Delhi yesterday, very angry, of course. We also heard from the Indian prime minister who is usually very mild mannered and careful with his words. But even he called the incident deplorable. But there is a feeling, I think, on both sides with both countries that it really isn't in anyone's interests to let this spiral out of control. Both countries need each other especially now economically speaking.

They do need each other and it wouldn't make sense for these countries to take a giant step backwards when they've worked so hard at developing warmer and better relationships over the last 10 to 12 years. There is a hope that Secretary Kerry's comments will help to calm tensions over here in India.

TAPPER: All right, thanks to Mallika for that report. Let's talk now to Nicholas Burns, the former undersecretary of state for political affairs. Nick is a long time diplomat. Nick, I want to get to the diplomacy of this in a second. First, let's talk about the elephant in the room. Something that you know and I have covered, which is there are a number of foreign diplomats in this country who bring in individuals from other countries and keep them captive in the form of indentured servitude.

Paying them much less than the minimum wage and in some cases, it is almost like slavery. We don't know what happened in this specific, but that's a reality that the U.S. State Department is trying to crack down on, right?

NICHOLAS BURNS, FORMER U.S. UNDERSECRETARY FOR POLITICAL AFFAIRS: The State Department is right to do that. Jake, I also don't know the particulars in this case involving the Indian diplomat in New York, but foreign diplomats who stay in the United States in Washington or in New York or elsewhere, need to abide by U.S. law particularly when it concerns domestic workers paying a fair wage, treating people with decency and respect.

I think what we are seeing here is the clash of two political cultures. In the United States, of course, the law always comes first. Everybody always has to adhere to the law. In India, there is an emotional reaction that the diplomat was subjected to undignified treatment.

I think that's why Secretary Kerry called today. In his statement that was put out by the State Department, he carefully supported U.S. law and defended U.S. law. But he said he empathized with the way that this woman was treated because he said he had two daughters of a similar age. I think that's the right balance for us to strike between these two very polar opposite reactions in the United States and India.

TAPPER: Let's talk about India's reaction. That country has retaliated to this incident by removing security barriers outside the U.S. Embassy in New Delhi, revoking diplomatic I.D. cards. These could be steps putting American lives at risk. Is that coming from the capitol of India? Where does a reaction like that come from?

BURNS: It is coming apparently from the foreign ministry. The police removed some of the security barriers around the American embassy in New Delhi. It is a very dangerous move. It's an overreaction and not the appropriate reaction, obviously, by the Indian government.

I think that Secretary Kerry's phone call is designed to diffuse this crisis and to get India and the United States back to what we have to be talking about. We are actually close friends and India is a very important ally of the United States and the same goes with the United States value to India. Hopefully this can be diffused so we can go back to working on very important issues on the agenda.

TAPPER: How detrimental do you think this is for U.S.-Indian relations in the long term?

BURNS: I think it is very detrimental in the short term because of the extraordinary reaction in India. Not just by the government, but by average people throughout India. They very much feel insulted by the way that this diplomat was treated. Not so much about the accusation that she may have violated American law, but the way she was treated when she was in detention.

I do think this can pass, however. Boy, there are big issues in our agenda. India and the United States have a similar concern about what will happen in Afghanistan when the bulk of American troops leave. We are both struggling to find a way to work with China, but also to send a stiff message to China that some of the more aggressive military actions in the south and East China Sea won't be tolerated. I would say India is one of the most important countries worldwide in terms of agenda.

TAPPER: All right, we hope this clears up soon. Nick Burns, thank you so much. Still to come, Dennis Rodman, headed back to North Korea. Is his friendship with Kim Jong-Un helping or hurting the situation?

Plus President Obama makes a statement about with his Olympic picks. But should he be doing more about Russia's anti-gay laws? And a presidential panel recommends major changes to the NSA spying program, but is the White House listening?

(COMMERCIAL BREAK)

TAPPER: In a clear jab at Russia's anti-gay laws, the U.S. delegation to the Winter Olympic Games will feature two prominently openly gay athletes and will not include President Obama. The delegation will include tennis legend, Billy Jean King and Olympic ice hockey player, Kathleen Cahow. Both of whom are open lesbians.

With me now is Olympic diver, Greg LOUGANIS, Olympic diving gold medallist, a gold medallist who is Nicholas Burns, still with us along with John Avlon, CNN political analyst and executive editor of the "Daily Beast." Greg, good to see you again.

I have you on my other show, THE LEAD, earlier today. Do you think what the president is doing is a strong enough message from the U.S. to Russia about its anti-gay laws or do you think it is in the passive aggressive zone?

GREG LOUGANIS, OLYMPIC DIVING GOLD MEDALIST: Well, I think it is the right thing to do. And with Billy Jean King and Brian Boitano and the other delegates he is sending there, hopefully they can get a message out. You never know with how they're going to treat any of the interviews with their own propaganda in Russia. So hopefully they'll be able to make a difference and even just their presence there as openly gay people. I think that's a step in the right direction.

BALDWIN: Nick, this is obviously something of a big statement to make to the Russians with whom the U.S. has not enjoyed the warmest relations in the last few years. Is it possible that this would make a bad situation even worse?

BURNS: I don't think so. I think the president did the right thing. He is sending two messages, President Obama to President Putin. Message number one, the United States is going to uphold the rights of gay and lesbian Americans, as we should, and of our athletes. And we're not going to condone the anti-gay legislation at the Russian parliament with Putin's support, has recently passed.

And I think message number two is, we're just not getting along with Putin right now. He is harboring Edward Snowden, he has been against us on Syria, has blocked all the U.N. resolutions there. He has made life very difficult for Ukrainians, and for those Ukranians who want to see a democratic future. I think the president's feelings is it is time to get tough with President Putin, and show President Putin that we can be definite about protecting our values. So for me, I think this is a positive step the president is taking.

TAPPER: John, let's talk about the politics of this.

President Obama gets to be somewhat tough against a reliable American foe. And also gets to be pro gay rights. Kind of a twofer.

JOHN AVLON, CNN CONTRIBUTOR: Yes. If you're playing domestic politics with the Olympics, sure. But, look, I mean, this is not quite like sending Jesse Owens to Hitler's Germany to prove a point. But it is a strong symbolic step. Look, our trump card as a country is freedom and diversity. Two thing Russia is not really known for.

So, this is a strong symbolic step but it is just a symbolic step. That said I think it will catch people's attention and what of some of the constructive contract for two countries. Whether it plays domestic will in the polls, probably won't even register. Is it the right thing to do? Hell yes.

TAPPER: Let's turn to another issue, interest and ill port, an international affair is North Korea.

Nick, I want to ask you. It is a bizarre story but Dennis Rodman is arriving in North Korea tomorrow. He obviously has a relationship with the leader, Kim Jong-Un and an op-ed in the "Washington Post", (INAUDIBLE), the only person known to have escaped to the west from a North Korean labor camp wrote to Rodman saying quote "maybe you can use your friendship and your time together to help him understand that he has the power to close the camps and rebuild the country's economy so everyone afford to eat.

Do you agree with that? Is there any real influence Rodman has and could exert with this threats?

BURNS: There is no influence that Dennis Rodman can bring to bear to improve the situation. When we travel abroad as American, we're not representing our government, but we are representing our country. And so, we should want to represent the dignity and values of the United States.

And the North Korean dictator, that's all he is, a tyrant and dictator, he is holding an American citizen as hostage right now, Dr. Kenneth Bae. He just released an 85-year-old American from Merrill Newman from prison and held him unjustly and he is the person who just, in a mafia style execution, killed his own uncle. So for Dennis Rodman to cavort with a dictator a tyrant like that strikes me as plain wrong.

TAPPER: Greg, I want to bring you in as a fellow athlete. It is completely different. But you, coming out of the closet, talking about being HIV positive. You have tried to use your name for good. Obviously what Dennis Rodman is doing, completely different and not comparable. But in the sense of trying to use your fame, your notoriety to achieve something positive, what do you think of what Dennis Rodman is doing?

LOUGANIS: Well, Dennis Rodman is Dennis Rodman, you know. You never know, you know, where he's coming from any way. So you know, but for my own personal belief is trying to use sharing myself as a whole person. I'm a gay man living with HIV. I happen to be an Olympian. The one thing that really concerns me about the whole Sochi thing is that the IOC is totally ignoring principle six which is anti- discrimination. And you know, that's very, very disturbing.

And the thing that I'm concerned about is the children. There are gay, lesbian, bisexual and transgender children born in Russia every day. And who is protect go those children? You know, I feel that all children need to be protected and nurtured. I'm an athlete. I'm not a world leader and I'm not going to pretend to be. I'm not always up on what's happening in the world. So, you know, I just go about my business of living and you know, I take my medicine in the morning and the evening which reminds me that I have HIV. But most of my life is devoted to the part of living.

TAPPER: John, this is now Dennis Rodman's third trip. Is the U.S. getting anything out of this?

AVLON: There's certainly no sign of it. He is completely misusing dignifying a dictator, as Nick said. And ultimately, it is a holiday for other people's misery. In a country with concentration camp. There is no evidence that we're are getting any kind of leverage. There was a lot of fantasies earlier about (INAUDIBLE) love of basketball. It make him more medical to the west. It doesn't seem to have civilized him so the actions don't really speak to that hope for reform. Instead, you are just getting another 10-pot dictator being catered to by a deal-less celebrity in America.

TAPPER: All right, Nick Burns, John Avlon and Greg Louganis, thank you so much. If I don't see you, have a merry Christmas to all of you.

Still to come, a presidential panel recommends major changes to NSA's fine program. But will the agency really give up some powers?

And a woman who claims she was treated like a slave by a diplomat speaks out.

(COMMERCIAL BREAK)

TAPPER: Changes may, I repeat, may be coming to the NSA's controversial spying program. An outside panel requested by President Obama suggested more transparency in the mass storage of Americans' phone records. But is that going to be enough?

Chief national correspondent Jim Sciutto has the details.

(BEGIN VIDEOTAPE)

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT (voice-over): Already battered by stinging headlines day after day over NSA spying. Today, the panel the president himself ordered recommends the NSA be subject to stronger accountability and transparency.

What the panel does not recommend is dismantling the program that sparked the most controversy in the U.S. The gathering of billions of bites of meta data of American's phone calls, something sure to upset the president's supporters on the limb. Instead, the panel made up of intelligence and legal experts recommends Congress pass legislation requiring phone companies to hold the data rather than being held by the NSA. And that the NSA be limited to gathering foreign intelligence on foreign targets.

SEN. PATRICK LEAHY (D), SENATE JUDICIARY CHAIRMAN: The message to the NSA is now coming from every branch of government from every corner of our nation. NSA, you've gone too far.

SCIUTTO: To help restore U.S. credibility abroad, the panel suggests sweeping reform including striking agreements with allies such as France and Germany on what spying among friends is acceptable and what is not.

The panel says monitoring the foreign leaders by the NSA should require approval directly from the White House. The report follows a bruising meeting at the White House Tuesday with executives from the country's largest tech companies.

Sources tell CNN's Jim Acosta, several said they flew to Washington to voice their concern on government surveillance. Hurting their bottom line abroad to the tune of $35 billion in lost business. Several were frustrated with the White House's focus on the troubled healthcare.gov Web site. At that meeting, sources say the president said one thing he is not considering is a pardon for NSA leaker Edward Snowden.

I spoke to a senior administration official who said the White House knows it has a trust gap. Well, here at home with the American public but also overseas, and that that gap has consequences. Cost to American businesses, cost to American credibility.

(END VIDEOTAPE)

SCIUTTO: So, the president now is going to look at these recommendations, choose which ones he is going to accept and I'm told, he is likely to make a speech in January to the American public on a new transparency for NSA surveillance -- Jake.

TAPPER: Our thanks to Jim Sciutto.

That's the policy. Now let's get to the politics of this all with Democratic strategist, Maria Cardona and Terry Holt, former spokesman for speaker John Boehner.

Maria, you heard Sciutto's report there. The president is trying to calm the public's outrage over the NSA spying programs. Do you think it will work?

MARIA CARDONA, CNN CONTRIBUTOR: We'll see what he ends up doing. We are not going to know until January. I think the president is rightly focused on striking this very difficult balance. I think what we need to stop doing, Jake, is treating the American people like the Jack Nicholson character on a few good men. They can't handle the truth.

So, I think as long as the administration is transparent and is above board and understands what the parameters are, I think that the president will be going, will be taking a step in the right direction.

But by the way, industry needs to do the same as well. These recommendations say while the NSA shouldn't be keeping this, it doesn't say that we shouldn't be doing it at all. It says industry should be keeping it.

TAPPER: Terry, so, the president obviously has a trust deficit in the way he never has in his entire political career. More people according to recent polls don't trust him than do trust him. That is a big hit for a guy like that who has relied upon people having faith.

Do you think the way they've handled the NSA scandal is part of the problem? Or is it just the NSA scandal. The idea that all these things were going on.

TERRY HOLT, FORMER SPOKESPERSON FOR SPEAKER BOEHNER: Well, the NSA scandal is just one more example of how the president's trust relationship with the American people has eroded on issue after issue. And because he hasn't had a lot of accomplishments, a lot of things to hang his hat on and say this is how to improve the economy or past immigration reform or whatever, these are just more nicks and cuts that diminish the presidency overtime.

And you know that the trust thing was not just brought up by the media. The guys who went to the CEO meeting at the White House the other day with the high-tech firms, they put in it his face. The president thought he was going to a photo op. And these guys, you said well, Mr. President, we don't know if we trust you. And that was the big news out of that event the other day.

TAPPER: Maria, it looks like you want to respond to that.

CARDONA: Well, I think that the important thing is that while the president says that we absolutely need to protect the privacy of Americans, he has said from the very beginning that he is not going to compromise on the security piece which I think is making a lot of liberals and civil libertarians upset. But I think at the end of the day, the American people do agree that we cannot really have both. I mean, this is an incredibly important story, Jake, because there is that balance that we need to find. But I think in essence, the American people know that they have been spied upon, if you will.

(CROSSTALK)

HOLT: There is a bipartisan concern here. If you're a conservative and you don't trust this government, you just say, oh, my God. This is just like the IRS where they were, you know, turning people's lives over for their own government policies. If you're a liberal, you were promised, you know, freedom and liberty and civil liberties that have been undermined during this presidency. So this isn't a party line issue.

TAPPER: That's true. But, there's also bipartisan support.

HOLT: You have to always operate on this.

TAPPER: I know. But when you're talking about security versus liberty, ultimately don't hear John Boehner, your form he boss, complaining about these NSA programs. He is actually a very strong supporter of them.

HOLT: Right.

TAPPER: And the same with a lot of Republicans will yes, you have the Rand Pauls of the world, and yes, you have commentators talking about, you know, jerks like me covering it. But the bottom line is, I think the American people honestly want security over freedom, I really do, when it comes down to these little things.

CARDONA: I think that's true. But I do think that what --

TAPPER: That's a generalization. You know what I mean.

CARDONA: Right. I mean, yes. There will be, you know, people on both sides that will disagree with that. But I think that this is why it is so important for the administration to be transparent in January, to see what they will accept or not accept, and then explain why because he does have a credibility issue right now. Even though this isn't one of those issues where the American people are outraged because I don't think that they are. And it is a bipartisan issue that people agree on. It is important for this president to be very transparent about this.

TAPPER: I want to get your response to something that Senator Rand Paul, who I just brought up, was said to Wolf Blitzer on CNN about the Director of National Intelligence James Clapper.

(BEGIN VIDEO CLIP)

SEN. RAND PAUL (R), KENTUCKY: I do think what our government is doing is unconstitutional. And I really think that in order to restore confidence in our intelligence community, I think James Clapper should resign.

(END VIDEO CLIP)

TAPPER: Should James Clapper resign? Would that do anything to restore this trust deficit?

TERRY HOLT, FORMER SPOKESMAN FOR SPEAKER BOEHNER: Well, you can throw a body over the side but I'm not sure that does anything for the president. I'm not sure that it fundamentally changes the policy direction of the country.

You know, the CIA has been an effective tool in our war against terrorism. I know we don't call it a war anymore. But without them, we probably wouldn't have gotten bin Laden.

And fundamentally, the policies stay in place. It's a question of how the president handles it, the sensitivity and the level of transparency that this government continues to offer the American people that I think is crucial.

TAPPER: All right. Maria Cardona and Terry Holt --

CARDONA: Jake, we agree on this.

TAPPER: You agree. I love it. It's a beautiful Christmas moment. Thank you so much. I appreciate it.

Still to come, another example of a diplomat allegedly abusing his power. A victim describes the abuse she endured.

And one of the stars of the show "Duck Dynasty" in some hot water tonight, over his anti-gay comments.

(COMMERCIAL BREAK)

TAPPER: The patriarch of the Duck Dynasty is taking on what he says is one of society's greatest sins, homosexuality.

In an interview with "G.Q. Magazine", Phil Robertson discussed his deeply held religious views on how the secularization of America has encouraged sinful behavior, starting with gay behavior and morphing out to bestiality and infidelity. He also weighed in on how happy African-Americans seemed to him back in Louisiana before the civil rights era.

Will his words hurt one of the most popular TV shows in America?

Tom Foreman has the story. And I want to warn you, this piece does contain some language that some people might find objectionable.

(BEGIN VIDEOTAPE)

(MUSIC)

TOM FOREMAN, CNN CORRESPONDENT (voice-over): With their A&E show pulling 14 million viewers a week, with an empire of DVDs, duck calls and a Christmas album two, it's no surprise "G.Q. Magazine" wanted to profile the duck dynasty crew at home in Louisiana.

UNIDENTIFIED MALE: He's happy.

FOREMAN: But the Bible-quoting patriarch of the Robertson family is raising eyebrows with his comments on homosexuality. "It seems like, to me, a vagina would be more desirable than a man's anus," Phil Robertson told the magazine. "Start with homosexual behavior and just morph out from there. Bestiality, sleeping around with this woman and that woman, and those men. It's not right."

WILSON CRUZ, GLAAD SPOKESMAN: A&E needs to come out very strongly and condemn Phil Robertson's statements.

FOREMAN: Wilson Cruz and other gay rights advocates are hitting back hard, citing growing acceptance of same sex marriage and relationships to suggest Robertson is ignorant, bigoted or both.

CRUZ: The world is changing. The country is changing and even the state in which Mr. Robertson lives is changing, and he needs to get in line.

UNIDENTIFIED MALE: It makes you wonder how we got roped into this.

UNIDENTIFIED MALE: I don't know.

FOREMAN: But others say hold on. Robertson was quoting widely supported church positions on sin, not just homosexuality. When he told "G.Q.", "The adulterers, the idolaters, the male prostitutes, the homosexual offenders, the greedy, the drunkards, the slanderers, the swindlers, they won't inherit the kingdom of God."

Russell Moore is with the Southern Baptist Convention.

RUSSELL MOORE, SOUTHERN BAPTIST CONVENTION: I think that suggesting people who hold to what every branch of the Christian faith has held to for 2,000 years are somehow bigoted or hateful is not productive for speech.

FOREMAN (on camera): Whether this battle on the bayou will harm the "Duck Dynasty" dynasty is not clear. But for many fans, the appeal has long been that the Robertsons speak openly about their conservative values.

UNIDENTIFIED FEMLE: Theo, be nicer when you tell something (INAUDIBLE).

FOREMAN: And there is this. Polls show about 44 percent of all Americans like Phil Robertson, still think homosexuality is morally wrong.

(END VIDEOTAPE)

FOREMAN: Late today, we got a statement from Phil Robertson through A&E in which he said, "I would never treat anyone with disrespect just because they're different from me. We are all created by the Almighty and like him, I love all of humanity."

I'm sure that won't quiet all the kerfuffle down, Jake, but an interesting playback and pushback on all this.

TAPPER: Also some interesting remarks in the "G.Q." story, he explained why he thinks African-Americans were happy prior to the civil rights movement, telling "G.Q.", quote, "I never heard one black person say, 'I tell you what, those doggone white people,' not a word. Pre-entitlement, pre-welfare, you say, were they happy? They were godly. They were happy. No one was singing the blues."

That's not quite a longing for the Jim Crow era but it is certainly a comment that I think a lot of African Americans would dispute.

FOREMAN: I understand why many people would find this to have. I think with that particular statement you have to read the whole statement. He begins by saying basically, when I grew up, where I grew up.

And having many members of my family from the South, there are many, many places in the South where everyone, white and black, lived in tremendous poverty and had a very difficult time. And there was very much a sense that people said, hey, we're all suffering together. Some may suffer more but we're all suffering together.

And he specified, in my place in my time this is what I saw. And remember, it's easy now with the Internet and television and everything to think we all have a bigger picture. Many people just a few generations back, a couple of generations, they really didn't have a bigger picture. They had the picture of their backyard.

So while people may find that very offensive now or think it is very insensitive now, I've heard many people over the years say similar things, when they said, where I lived in my time, everyone was poor. Everyone struggled and they don't mean it in a racist way. They mean that everybody struggled.

TAPPER: In terms of his comments about homosexuality, there are million of Americans that have those religious views that all sorts of behaviors are sinful.

FOREMAN: Well, a lot of them make the point of saying, look. This is a fine point that I think a lot of gay rights advocates may disagree with, but they will say they are condemning what they consider sinful activity but not the people. The saying is: hate the sin, love the sinner.

And many -- I think you're hearing more language, particularly in the religious community of people saying, look, in the religious community, do not condemn homosexual people or gay people.

TAPPER: Yes.

FOREMAN: Condemn the activity if you feel it is wrong.

TAPPER: To be continued. There's obviously going to be a lot more and I'm sure much more response to gay rights groups and A&E, I imagine.

Still to come, another diplomat allegedly abusing his power. A victim describes her ordeal.

And "Anchorman 2" is in theaters and my interview with the film's Will Ferrell, coming up later in the show.

(COMMERCIAL BREAK)

TAPPER: Some breaking news on the case of the Indian diplomat who was strip searched after she was arrested on visa fraud charges, igniting an international firestorm. We've just received a statement from the Manhattan U.S. attorney.

Deborah Feyerick has been on the story.

Deb, what did the U.S. attorney say about this case?

(BEGIN VIDEOTAPE)

DEBORAH FEYERICK, CNN NATIONAL CORRESPONDENT (voice-over): Well, the U.S. attorney who has been monitoring the coverage today both here in the United States and also abroad set the record straight on a couple of things. First of all, he wanted to make clear that in fact the deputy consul general, Devyani Khobragade, was, in fact, treated with certain courtesies not afforded to other people.

He made clear that, in fact, she was not arrested in front of her kids. She was not handcuffed, as some reports have suggested. Her phone was not seized. She was allowed to keep it, and actually allowed to make phone calls from the back of a car because it was cold outside so that she could arrange childcare for the daughter that she had just dropped off at school.

Now, in terms of the strip search, that's really one of the things that has outraged the Indian community, the U.S. attorney made clear, he said, quote, "It is clear that she was fully searched by a female deputy marshal in a private setting, when she was brought boo the U.S. marshal's custody. This is standard practice for every defendant, rich or poor, American or not, in order to make sure that no prisoner keeps anything on his person that could harm anyone including himself."

So, really, it's about the treatment of this diplomat that he addresses. But he also talks about the victim. The victim in this case saying that the family has been brought to the United States but also the family, it seems, was being treated unfairly in India. That's one of the reasons they were brought here to join this woman -- Jake.

TAPPER: All right. Deborah Feyerick, thank you so much.

The housekeeper in this case claims she got paid just $3 an hour. Way below minimum wage. If true, she may be part of a growing trend in the U.S., household employees abused by their former diplomat bosses.

(BEGIN VIDEOTAPE)

TAPPER (voice-over): Behind the ornate doors of the most exclusive embassies in Washington, D.C. lurks a dark secret: foreign diplomats abusing workers in their home, domestic servants forced into lives of indentured servitude, even slavery. And they often get away with it, invoking a policy called diplomatic immunity when accused, which protects them from being prosecuted in a foreign country.

AMBASSADOR LUIS CDEBACA, U.S. STATE DEPARTMENT: It happens miles from the White House in Washington, D.C.

TAPPER: Ambassador Luis CdeBaca directs the State Department's office to monitor and combat trafficking in persons.

CDEBACA: We hear way too many stories from around the world of diplomats who think they have carte blanche to treat their servants badly.

ROSEMARY MARTELL, ALLEGED HUMAN TRAFFICKING VICTIM (through translator): I thought about dying.

TAPPER: One alleged victim, Rosemary Martell from Peru, whose nightmare begun in 2008 when she was hired to work for a Peruvian diplomat to work for him while stationed in the U.S. She was told she would be working at this house in which the diplomat no longer lives, that she would work 40 hours a week at $1,500 a month.

(on camera): How much did they pay you? MARTELL: Three hundred dollars a month.

TAPPER: Three hundred dollars a month?

MARTELL: Yes.

TAPPER (voice-over): But the paltry wages were the least of it. The treatment, she alleges, was abusive.

(on camera): Do you think they basically treated you like a slave?

MARTELL: Yes, because I worked from 5:30 a.m. when I woke up until 11:30 or midnight every single day. They asked me to give them massages every day to both of them. Even foot massages.

He would touch my legs and ask to see me in a bikini.

TAPPER (voice-over): She said the diplomat confiscated her passport. Rosemary thought she was trapped.

(on camera): You were afraid that you had to do everything that they told you to do?

MARTELL: They threatened with hurting my family if I left. They also threatened to call immigration to get me deported.

TAPPER (voice-over): Rosemary's story is quite common. The Government Accountability Office looked into the issue in 2008 and found that in recent years, 42 domestic workers officially alleged they were abused by their foreign diplomat employers and they said the actual numbers of victims are likely higher.

Just last month in McLean, Virginia, the Department of Homeland Security rescued two women from the Philippines from a multi-million dollar house owned by the Saudi embassy. They were working for a Saudi diplomat who U.S. officials say held their passports and forced them into lives of indentures servitude. An investigation is under way.

Attorney Martina Vandenberg represents a victim who was just awarded $1 million after being abused by a Tanzanian diplomat here.

MARTINA VANDENBERG, ATTORNY SPECIALIZING IN HUMAN TRAFFICKING: The common thread among all of those cases is that the diplomats have total immunity, which means you cannot investigate them appropriately. You cannot arrest them. You cannot question them. It's almost impossible to do an investigation that would lead to a waiver of immunity to actually prosecute them in the United States.

TAPPER: In this case, with the help of the group Casa de Maryland, Rosemary Martell was able to flee and she later pressed charges against the Peruvian diplomat who claims that she's making everything up. He, however, also claimed diplomatic immunity, and the case has therefore gone nowhere.

The diplomat's lawyer says he's innocent and instead blames Martell for, quote, "blaming the legal system" and the immigration system."

The newest unit in the Diplomatic Security Services looks at human trafficking in the U.S. And the State Department has just started briefing domestic workers brought here by foreign diplomats, giving them pamphlets with important information.

CDEBACA: It just tells them, you've got rights in the United States, even if they could take your passport and lock it up back home, even if they could take your money back home, they shouldn't. But in the United States if they do it, they're committing a crime.

TAPPER: After two years of what she describes as slavery, Rosemary Martell says she has recovered and is building a family and a life for herself here in the United States.

MARTELL: Now, I'm happy. I have my six-month-old baby. She's my happiness. I'm happy because I'm working with a group of women to let others know their rights so that the same things that happened to me don't happen to them.

(END VIDEOTAPE)

TAPPER: Just a few minutes ago, we told you about the story of Phil Robertson, the patriarch of the "Duck Dynasty" clan being in some hot water for controversial comments he made about homosexuality.

Now, we have Tom Foreman back at the desk with an update. What's the news?

FOREMAN: Yes, we just got word from A&E network moment ago. They said they are disappointed by what he had to say and all the fans, you'll note the network placed Phil under hiatus from filming indefinitely. This is very, very big news and I'm sure we'll hear a lot about this tomorrow.

TAPPER: One of the most popular shows in American television.

Tom Foreman, thank you so much.

Still to come, my interview with "The Anchorman", Will Ferrell.

(COMMERCIAL BREAK)

TAPPER: I'm Ron Burgundy? No, it's this guy.

(BEGIN VIDEOTAPE)

TAPPER (voice-over): It was the sound byte that launched a comedy franchise.

UNIDENTIFIED MALE: I liked women but I wasn't sure their place was sitting beside me on an anchor sit.

TAPPER: That's Philadelphia anchorman Mort Crim in a lifetime documentary about pioneering anchorwoman Jessica Savitch.

WILL FERRELL, ACTOR: That's kind of was the genesis for us sitting here right now.

TAPPER: We sat down with the anchor at the newsuem in Washington D.C. in an exhibit dedicated to the film.

(on camera): So, this must tripping. Museum exhibit, and an actual museum dedicated for this he film.

FERRELL: Yes, it's very bizarre. They've done a beautiful job of archiving the old news stations and news teams, and we weren't far off the mark without even knowing it.

TAPPER: No, I didn't even realize, first of all, how much Paul Rudd's character, Brian Fantana, it was -- his entire wardrobe is Geraldo Rivera.

FERRELL: Pretty much.

TAPPER: The entire thing?

FERRELL: Yes, yes.

TAPPER: I happen to regard this as the best comedy of the last decade. But it didn't --

FERRELL: Well, you're wrong.

TAPPER: Which one --

FERRELL: I think it's "Booty Cool".

UNIDENTIFIED MALE: Booty.

UNIDENTIFIED MALE: Can I get something?

(LAUGHTER)

FERRELL: Yes, but go ahead.

TAPPER: Well, I think "Booty Call" actually came out, top five. "Booty Call" is more than ten years ago.

FERRELL: OK, you're right. Never mind.

TAPPER: I think it was late '90s. I keep a list starting in '04s.

FERRELL: I think it's timeless so I throw it into many different time periods.

I love scotch, that is good.

TAPPER: It wasn't initially received as what it's become.

FERRELL: No, it was a modest hit in the theaters when it first came out, and it was actually very divisive. I have friends who would say, that was the funniest thing, and other people were like, I don't get it. I had a really good friend who went on a double date and the other couple left in the middle of the movie. It's kind of now has this legendary status, but it definitely didn't start that way.

UNIDENTIFIED MALE: We're starting a 24-hour news channel and we want you.

UNIDENTIFIED MALE: Going to do the thing that God put Ron Burgundy on this Earth to do, have salon quality hair and read the news.

FERRELL: This film is roughly ten years later. It's 1980, which was the first year for CNN and for ESPN and a lot -- beginning of the 24- hour channels, and we kind of find Ron and his team and what they are doing, and they are kind of give an second chance to get back into the news game by going on the brand-new 24-hour news channel.

UNIDENTIFIED MALE: Welcome to GNN.

UNIDENTIFIED MALE: The global news network.

TAPPER: So, it's like CNN, CNN-esque.

FERRELL: It's called GNN. So it's --

TAPPER: Completely different.

FERRELL: Completely different.

TAPPER: Right.

FERRELL: Yes, it's CNN -- esque.

UNIDENTIFIED MALE: I don't have any legs, Ron.

FERRELL: You know, what better back group to see Ron and his incompetent fellow news team try to compete with what is now pretty much modern day news.

TAPPER: And is there anybody that Ron Burgundy is modeled after?

BURGUNDY: He's just an amalgamation of all the local news guys I watched growing up, even though we -- you run into people in local news, and they say I bet I know who that is based on.

Everyone owns it. There is a guy in L.A., local guy, Herold Green, who was in San Diego, he went to L.A., used to have a mustache and I randomly ran into him on the street one day and he like, that movie is based on me, isn't it?

I go no. He said, there is an old saying in the news game, yes, right. And he walked away. So, he was convinced it was based on him.

TAPPER: That's a good line.

FERRELL: Yes.

TAPPER: Is there something about my profession that is inherently --

FERRELL: It's a profession that's based on being serious, having good hair -- your hair looks great.

TAPPER: Thank you. Appreciate it. That's going to be in my promos.

FERRELL: And that's a fun world to make fun of.

TAPPER: Appreciate it. Thank you so much.

(END VIDEOTAPE)

TAPPER: "AC360" starts now.

ANDERSON COOPER, CNN ANCHOR: Jake, thanks. Good evening, everyone.

Tonight, the so-called "affluenza killer", the 16-year-old from a wealthy family who got probation because a judge was persuaded that being a rich child explains manslaughter. Now, the law is taking another shot at giving him jail time.

Also, breaking news in the war of words between India and the United States. Indians are burning American flags. The Indian government shopped protecting the U.S. embassy against possible attacks.