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THE SITUATION ROOM

Interview With Maine Senator Angus King; President Obama Criticizes Sony; Sony CEO Speaks Out

Aired December 19, 2014 - 18:00   ET

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


WOLF BLITZER, CNN ANCHOR: Happening now: North Korea blamed for the cyber-attack on Sony. President Obama calls the damage significant. He is promising a response equal to the crime.

Just hours after the president's news conference, he's now wrapping up an exclusive one-on-one interview with CNN. We're standing by for details.

And Sony's CEO fights back. He's talking exclusively to CNN and denying his company caved to North Korea's threats.

We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

BLITZER: Let's get to the breaking news tonight. President Obama is promising that North Korea will pay for the cyber-attack on Sony, and he's not ready to say yet, though, what that punishment might be.

He is making it clear that he thinks it was a mistake for Sony to cancel the release of the movie entitled "The Interview." Now the head of Sony Entertainment is firing back. In an exclusive interview with CNN, he's denying his company gave in to North Korea's threats. Listen to the president's remarks and Sony's response.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Sony is a corporation. It suffered significant damage. There were threats against its employees. I am sympathetic to the concerns that they faced. Having said all that, yes, I think they made a mistake.

FAREED ZAKARIA, CNN WORLD AFFAIRS ANALYST: Did you make a mistake?

MICHAEL LYNTON, CEO, SONY PICTURES ENTERTAINMENT: No. We have not caved. We have not given in. We have persevered and we have not backed down. We have always had every desire to have the American public see this movie.

(END VIDEO CLIP)

BLITZER: The Senate Intelligence Committee member Angus King, he is standing by, along with all our correspondents and our analysts. They're covering all the breaking news on the cyber-attack, President Obama's news conference and Sony's response.

First, let's get the very latest from our chief national security correspondent, Jim Sciutto -- Jim.

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT: Wolf, this was an investigation as unprecedented as the attack in many ways, both in its speed and its scope. Investigators from the FBI, NSA and other intelligence agencies working around the clock tracking the hackers around the world, from Asia, including China, to Europe, Latin America, even servers here in the U.S.

They were eliminating other potential suspects as they went, including actors in China, Iran, Russia. Ultimately the trail led back to North Korea.

(BEGIN VIDEOTAPE)

SCIUTTO (voice-over): The blame has been dealt, the U.S. now calling out North Korea, naming the rogue nation publicly as responsible for the Sony hack. In a statement today, the FBI said "The destructive nature of this attack, coupled with its coercive nature, sets it apart."

OBAMA: We cannot have a society in which some dictator someplace can start imposing censorship here in the United States.

SCIUTTO: The hackers sent investigators on a worldwide chase, routing the attack through servers ranging countries in Asia, including China, then Europe and Latin America. Some servers in the U.S. were even used. Still, the NSA and FBI were able to track the attack back to North Korea and its government.

JIM LEWIS, CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES: Think of this as dirty tricks on a global scale. This has exceeded their expectations. They always make threats. Most people shrug off the threats. So threatening a cyber-9/11, the film is dead, they must be incredibly happy in Pyongyang.

SCIUTTO: Now that the country behind those damaging keystrokes has been identified, the administration is looking at how to respond.

OBAMA: They caused a lot of damage. And we will respond. We will respond proportionally, and we will respond in a place and time and manner that we choose.

SCIUTTO: The U.S. could impose sanctions on North Korea's prized military complex and further economic sanctions, including applying even tighter restrictions on Pyongyang's access to dollar-denominated trade, the desperately poor communist state's economic lifeline to fuel, food, and crucially weapons. Still, U.S. officials are not yet calling the hack an act of terror or war.

REAR ADM. JOHN KIRBY, PENTAGON PRESS SECRETARY: The cyber-domain remains challenging. It remains very fluid. Part of the reason why it's such a challenging domain for us is because there aren't internationally accepted norms and protocols.

(END VIDEOTAPE)

SCIUTTO: There are other steps the U.S. could take, stealthier forms of retaliation, such as cyber-attacks on critical systems delivered in a way that the source is unclear. Think the Stuxnet virus used against Iran's nuclear program.

But the administration also very conscious here of avoiding escalation. They don't want to provoke further cyber-attacks or, worse, steps, Wolf, such as missile tests or even another nuclear test by North Korea.

BLITZER: Jim, you spent time in China. That's the source of a lot of the cyber-attacks against U.S. businesses, even some government agencies. How did the U.S. respond to what they allege that China was doing? Go ahead.

SCIUTTO: Well, first by naming and shaming China. But that took years rather than days in this case. Only very recently have American companies that have been the victims of cyber-attacks from China gone public, banding together finally to say, enough is enough.

Until then, they have been reluctant, one, to admit they have these vulnerabilities, but also, two, by going public, they were worried it would invite further attacks. We saw that in this case with Sony and others involved with this movie. But the real problem here, the real challenge is the defense going forward.

It's frankly difficult to defend against these attacks, but it's also expensive. One thing that legislation before Congress is trying to correct is improving the cooperation between the government and companies, the government helping companies to defend against these attacks.

But, listen, Wolf, these attacks have been going on for years coming from China. They haven't quite figured out a way to defend against them. It's going to take some time.

BLITZER: Certainly will. Thanks very much, Jim Sciutto.

We're also learning more about the federal investigation into the Sony cyber-attack. U.S. officials have publicly, openly pinned the blame on North Korea.

Our justice reporter Evan Perez has been working his sources and getting more information.

What else are you learning, Evan?

EVAN PEREZ, CNN JUSTICE CORRESPONDENT: Wolf, behind the scenes, the FBI, the NSA, the White House, the Justice Department have been working on this case around the clock.

Really, the turning point was when these hackers made the threat on Christmas Day they were going to launch terrorist attacks if this movie opened, as Sony had planned. The decision was made that it was time that they needed to name and shame North Korea.

Of course, now they're trying to decide how to respond to this, Wolf, because behind the scenes, the intelligence and law enforcement officials tell me that they were outraged, because North Korea has managed to win basically with this attack by censoring an American movie studio, and they fear that this means there will be more of these types of attacks.

BLITZER: Evan Perez, thanks very much for that.

In a new statement, Sony Entertainment now says it hopes anybody that wants to see the film "The Interview" will eventually get a chance to see it. But the company remains firm it had no choice but to cancel the film's release on Christmas Day because of North Korea's threats.

Let's hear more now from CNN's exclusive interview with the head of Sony Entertainment. He's rejecting President Obama's claim his company made a mistake by pulling the movie. Listen to this.

(BEGIN VIDEO CLIP)

LYNTON: The press and the public are mistaken as to what actually happened.

We do not own movie theaters. We cannot determine whether or not a movie will be played in movie theaters. So to sort of rehearse for a moment the sequence of events, we experienced the worst cyber-attack in American history and persevered for three-and-a-half weeks under enormous stress and enormous difficulty, and all with the effort of trying to keep our business up and running and get this movie out into the public.

When it came to the crucial moment when a threat came out from what was called the GOP at the time, threatening audiences who would go to the movie theaters, the movie theaters came to us, one by one over the course of a very short period of time, we were completely surprised by it, and announced that they would not carry the movie.

At that point in time, we had no alternative but to not proceed with the theatrical release on the 25th of December. And that's all we did.

(END VIDEO CLIP)

BLITZER: Now President Obama is responding to Michael Lynton. Just minutes ago, he wrapped up an exclusive interview with CNN's Candy Crowley, our chief political correspondent, the anchor of CNN's "STATE OF THE UNION."

Candy is joining us now from the North Lawn of the White House.

How did it go, Candy? What did he say?

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Well, it went fine. And I said to him, I summarized what the chairman of Sony had

said, that the movie distributors had come to him and -- I'm sorry -- the movie showers, movie theaters had said, we can't show this. And the president said, look, I understand, and I said I understand they were under pressure. But maybe if he had come to me, I could have talked to those movie theater chains and talked to them about it.

And he said it just sends the wrong signal. It's not what we need to do. He used CNN as an example and said what if CNN was threatened because of something it said in a coverage or documentary? We can't shut that down.

He feels very strongly that's the same here. You talk to White House officials about, well, apparently Sony did call, but he said, yes, but they called about the hacking. There were not discussions about distributing or not distributing. So the president very much sticks with the idea that he's sympathetic with it, but he still thinks it's the wrong signal.

BLITZER: He seems almost liberated in these final two years. He mentioned, Candy, in his news conference, he was going into the fourth quarter of his administration, and crazy things happen in a football game in the fourth quarter, but he seemed really willing to speak out and say what maybe he might have been a little bit more cautious about saying during the first six years.

CROWLEY: I think so.

I think we remarked afterwards. I said, he seemed really relax. Now, part of it, I kidded him when he came in. This is a 5:15 interview. And I said to him, oh, my gosh, I thought we were going to have to watch you packing, because, as you know, they're off to Hawaii. He said, no, I'm already packed.

So there's that end-of-the-year sort of giddiness. Somebody described it to me in the White House as the last day of school for the White House staff. So, I think the president is feeling some of that, but I think he's also feeling the release of he's not now responsible for midterm elections. He's not responsible for, you know, whether the Senate majority can get this or that, because the die is cast and he's going to be working with Republicans.

As you heard him say, I will work where I can. I think there are things we can do business on.

BLITZER: The full interview will air of course Candy Crowley's "STATE OF THE UNION" Sunday morning 9:00 a.m. Eastern and also at noon Eastern.

And this, by the way, I want our viewers to know will be Candy's final "STATE OF THE UNION" after five years. After 27 brilliant years at CNN, Candy is moving on. Candy has been an inspiration, a wonderful journalist, more important, a great person over all of these years. She's been extremely helpful to me.

CROWLEY: Thanks, Wolf. BLITZER: She's been extremely to all of our colleagues here at

CNN.

Candy, we're going to miss you. Thanks so much for everything you have done.

CROWLEY: Thank you, Wolf.

BLITZER: Candy Crowley.

Don't forget, the full interview wrapping up "STATE OF THE UNION" Sunday morning 9:00 a.m. Eastern.

Let's bring in a key member of the Senate Intelligence Committee right now, also a member of the Armed Services Committee, Senator Angus King. He's the independent senator from Maine. He caucuses with the Democrats.

Do you agree with the president, Senator, that Sony made a mistake by pulling the movie?

SEN. ANGUS KING (I), MAINE: Well, it sounds to me like maybe I should invite the president and the president of Sony over for a beer so they can work this out.

I agree with the general point. I think the president of Sony makes a good point, that it wasn't they that made this decision. It was the theaters that said we're not going to open and carry the film.

But the president's general point is that you can't give in to intimidation and threats like this. And I think that's correct. But, Wolf, I have got to say, this is -- the real story here is the vulnerability of this country to this kind of attack.

It was a movie production house. What if it had been the New York Stock Exchange or the power grid or the gas pipeline system? I mean, this is a huge problem. And in a sense, you know, it's a cliche to use the term wakeup call, but, man, oh, man, this is something that we have got to do.

And frankly I think it's the one big piece of unfinished business from the last Congress. John McCain says we're going to get on it in the first two weeks and I sure hope so, because the fact that we're the most technologically advanced country in the world is the good news. And the bad news is we're the most technologically dependent.

So I think the real story here is, what does this tell us about our whole country's vulnerability?

BLITZER: Yes. It's really chilling when you think about what these hackers could do, especially a nation state, if you will.

I want to play another clip, Senator, from Fareed's exclusive interview with the Sony CEO. Listen to this.

(BEGIN VIDEO CLIP) ZAKARIA: You are well known as somebody who supported President

Obama.

LYNTON: Yes.

ZAKARIA: Were you disappointed in what you heard today?

LYNTON: I would be fibbing to say I wasn't disappointed.

The president and I haven't spoken. I don't know exactly whether he understands the sequence of events that led up to the movie's not being shown in the theaters. And, therefore, I would disagree with the notion that it was a mistake. It's a generally held view by the public and the press that's what happened, and maybe that's how that view was held by him.

But knowing as I do the facts and how they have unfolded, you know, we stood extremely firm in terms of making certain that this movie would appear in theaters.

(END VIDEO CLIP)

BLITZER: What does it say to you about the way this whole situation unfolded, Senator, the message it sends to cyber-terrorists out there?

KING: It's a terrible message, but it's one -- you know, Wolf, we're getting -- right at this very moment, there are probably 1,000 attempts to hack American businesses right now.

It happens all the time. I have run into it in small businesses here in Maine and large businesses. We just -- whether it's international hacking or just good-old garden variety crooks. We had Target and we have had other major companies. This is a huge issue.

I have been saying for the last year-and-a-half the next Pearl Harbor will be cyber. And shame on us if we're not ready for it, particularly having this incident occur, which is really a kind of dress rehearsal for something that could be much more serious in terms of effect on infrastructure and those kinds of things.

This is a -- what they call an asymmetric vulnerability because of our technological advancement. You know, the bad news is, we're extraordinarily vulnerable. And we have got to figure this out. And one of the things I think one of your reporters mentioned, there needs to be a closer area of cooperation between government agencies like the NSA and the FBI and the private sector, so that when there is a threat or when they detect an intrusion of some kind, we can immediately respond with all the knowledge and information we have both in the government and outside.

And that's what is not happening right now. That's what I think Congress has got to fix hopefully in the first couple of weeks, if not the first month or so, of the new year.

BLITZER: Yes. Stand by for a moment, Senator. We have more questions on what

happens next, what the U.S. should do. Specifically, how much of a threat to the United States is Kim Jong-un and the North Korean regime? Much more with Senator Angus King.

We're following the breaking news right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: We're back with Senator Angus king. He's a leading member of the Senate Intelligence and Armed Services Committee.

Senator, I want you to stand by.

We're getting some new information about North Korea's cyber- warfare. I'm going to want you to react to that.

South Korea is now revealing details of an attack on its nuclear power plant system.

Let's go to Seoul, South Korea, for all the details.

CNN's Kyung Lah is joining us live.

What are you learning, Kyung?

KYUNG LAH, CNN NATIONAL CORRESPONDENT: Well, Wolf,, we need to underscore that this is the very first time we're hearing about this in this country. It's coming to light just now.

We have to underscore as well that it was a successful attack. Just like with Sony, what investigators here on South Korea are saying, it was the same malware that allowed hackers to get into one of the most difficult government agencies, one of the most protected in this entire country, the one that runs nuclear power plants.

(BEGIN VIDEOTAPE)

LAH (voice-over): South Korean officials say the North has launched a series of crippling attacks in that country, the most brazen coming to light just this week, a hack of South Korea's nuclear power plant system.

Lim Jong-in is a security expert who works with South Korea's military and says hackers posted on a blog nuclear power plant blueprints and other secret documents and then wrote this.

LIM JONG-IN, KOREA UNIVERSITY: If (INAUDIBLE) stop operation of nuclear power plant, they will destroy.

LAH (on camera): Wow. Very serious.

LIM JONG-IN: Yes.

LAH: That raise some serious alarm bells with the government. LIM JONG-IN: Yes.

LAH (voice-over): Not just because of what was stolen, but because of what this means. They're getting better at it. While the North consistently pleads innocence, the South maintains the evidence is there. Last year, South Korea's banks and media companies were hacked, ATMs frozen, television news knocked off the air, similar malware to what ground Sony systems to a halt and similar code to what led to this latest breach of South Korean nuclear power plants.

There's a pattern, says In, practiced first in South Korea, then aimed overseas.

(on camera): Should America be prepared for North Korea to try to break in to these types of agencies in America?

(voice-over): "Of course," he says. "Even though the U.S. is one of the best prepared nations, cyber-attacks are really hard to protect yourself from. So they have to constantly be vigilant."

SETH ROGEN, ACTOR: You want us to kill the leader of North Korea?

ACTRESS: Yes.

JAMES FRANCO, ACTOR: What?

LAH: With Sony's stunning decision pulling this movie, it may send a simple signal to North Korea: Cyber-attacks work.

(END VIDEOTAPE)

LAH: Now, one concern that Korean investigators here have is what could be next in America. One thing that Koreans, South Koreans suspect that North Koreans want to target is NASA, because there is nothing more, Wolf, that they would love than to control the communication, the way we communicate in the United States -- Wolf.

BLITZER: I just want to be precise, that one threat issued by the North Koreans to the South Koreans, something along the lines, he said if you don't stop your nuclear power plant, you will be destroyed, is that what they're threatening?

LAH: That was the threat. It was the threat that if you don't do what we want, we're going to destroy your nuclear power plant. That was the threat that was posted on a blog along with blueprints of that nuclear power plant.

It fits a pattern, because we have heard the North Koreans try to threaten, whether it be the United States or South Korea. They threaten. They can't follow through, but they do make the threat.

BLITZER: Wow.

Kyung Lah reporting for us from Seoul, South Korea, it's only 40 miles or so from the DMZ, the demilitarized zone, with North Korea. Let's bring back Senator Angus King, a member of Senate

Intelligence and Armed Services Committee.

So, how much of a threat, Senator, do you believe North Korea really poses to the United States?

KING: I think it's a serious threat.

I felt like saying after listening to that report, I rest my case. This Sony thing, it's a movie, OK? It's important and it's annoying and difficult and certainly devastating for the people at that company, but what if it was a nuclear power plant or the New York Stock Exchange or one of our -- or our banking system?

This is real stuff, Wolf. We're focusing on North Korea, but there are other countries around the world that have this capacity and that are using it, sometimes just for good old theft of intellectual property and sometimes money.

But the national security implications of this are extreme. I mean, I don't want to scare people, but this is something that we have to attend to. And one of the other problems is, it can be done relatively cheaply. You don't have to build a huge missile complex or complicated weapons or anything else. You just have to have some really smart, diabolical people with a laptop on the network.

This is one of the threats. This is one of the disadvantages of the 21st century. We just have to learn how to deal with it and how to defend ourselves and that's -- I think it's one of our great challenges in the next couple of years.

BLITZER: What other countries are you talking about?

KING: Well, we know China is doing this in a very serious way, not necessarily in a national security way, but more on intellectual property and those kinds of things.

We know that Iran has this capacity. We know that the Russians have this capacity. Those are ones that we know for sure, along with North Korea. And then the other thing, you know, it's like talking about terrorism. What about some guy in a basement in Peoria who decides it would be fun to stop all the stoplights in Chicago or something?

There's a sort of internal threat. I don't necessarily call it terrorism. But, again, this is a vulnerability based upon our technological dependence, which makes our -- enriches our lives tremendously, but this is the downside of it. And I think it's something that's going to be happening more frequently.

And we're going to have to do -- and there's never going to be 100 percent defense. There's never going to be total assurance. But I do think there are more things we can do when you combine the knowledge and expertise in the private sector and what we know in the public sector in the government.

We have really got to face this, I think, as one of the most, if not the most serious threat that this country faces right now.

BLITZER: Because I have heard cyber-warfare experts, government experts tell me their nightmare scenario is the U.S. power grid. Here's the question. Is that vulnerable?

KING: You know, I'm not an expert. I know that there are plenty of people working on making it not vulnerable. But I suspect Sony probably thought they had pretty good defenses, too.

That's the concern, is the power grid, gas pipelines, the New York Stock Exchange, the financial system, all of those kinds of things. I can't say whether it's vulnerable or not. But I don't think anybody can say to a certainty that they're invulnerable. And we just have to -- I think we have to start with the assumption that, A, this is a serious threat, B, we have to deal with it in a timely way.

We don't have two or three years to think about this, and that it's going to take the best resources we can muster, both in the private sector and the public sector, in order to defend ourselves.

BLITZER: Very quickly, what do you want the U.S. to do now to North Korea?

KING: I think -- again, I'm not making these decisions, but I like the president's response that there will be a response, it will be proportional, and it will be at a time of our choosing.

I'm guessing there's going to be some kind of cyber-response. One of the problems is, this is essentially a hermit country. There are not a lot of things -- we can't cut off aid or remove our ambassador or cut off a banking system. But they're engaged in a lot of enterprises around the world that I think we might have an opportunity to disrupt that are bringing money into the country that I think that -- I suspect there's some people in Washington right now who are thinking about networks that may be disrupted, financial networks that might be disrupted and make them pay a price.

I think they do have to pay a price. And I think the president made that clear today.

Wolf, I don't want to leave without echoing your comments to Candy. Frankly, I don't know how we're going to have a presidential election in two years without Candy Crowley. I mean, it just won't seem the same.

So I also want to add my thanks to her for the great work she's done over the years in keeping us all informed and asking the right questions at the right time.

BLITZER: Yes. Well said indeed. We're all going to miss Candy very much here at CNN. Our viewers in the United States and around the world will miss her as well.

But she's moving on to a new chapter. And she's going to be just as excited, just as nice as ever. We wish her, of course, only, only the best.

Senator, thanks very much for joining us.

KING: Thanks, Wolf. Always good to be with you.

BLITZER: We're going to have much more on North Korea and this threat against the United States. What should the U.S. be doing next?

We're also checking in -- take a look at this. We have got some live pictures coming in. This is a new protest under way against police tactics, what the protesters are calling an abuse of power. This is happening right at the NYPD, the New York Police Department headquarters in Manhattan. We're also hearing about a counterprotest with people supporting police in New York City. We're going to update you on what's going on. That and a lot more when we come back.

(COMMERCIAL BREAK)

BLITZER: We're back with the breaking news. President Obama standing by his statement that it was a mistake for Sony Entertainment to pull the plug on the comedy movie "The Interview."

He told our Candy Crowley just a little while ago he might have been able to sway movie theaters to show the film despite threats by North Korea.

Let's bring in our chief political analyst, Gloria Borger; our senior legal analyst, Jeffrey Toobin; and our chief congressional correspondent, Dana Bash.

Guys, thanks very much for joining us.

Jeffrey, there's been a lot of this back and forth all day today between the president and Sony about the decision to pull the film. President Obama said he wished Sony had called them, Sony pushing back to our own Fareed Zakaria, saying they didn't have much choice with the theaters themselves decided to pull the movie and not show it. So how much blame can be place on Sony; how much blame goes to the theaters, the distributors?

JEFFREY TOOBIN, CNN LAW ENFORCEMENT ANALYST: Well, I think this is really the distributors' decision and the theaters, they're the ones. You know, since 1948, a Supreme Court decision, movie studios are not even allowed to own theaters. So this was not Sony's decision.

But I think this sort of misses the main point, which is that Sony has been left out twisting in the wind by the other entertainment companies, who have not stepped up and shown any solidarity at all. Where is Disney? Where is Comcast Universal? Where is our parent company, Time Warner? You know, these are the people who are really at risk. Do you think North Korea is going to stop with this one movie?

This just shows that these companies have acted in a small-minded way, in a shortsighted way when it's not just the government that has to respond, it's all Americans and all companies to strike back at this threat.

BLITZER: Gloria, it really is pretty amazing when you think about it. So much of the president's end-of-year news conference today was dominated...

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Sony.

BLITZER: ... by Sony and North Korea.

BORGER: Yes, it was, because it's a story that everybody is interested in and understands, and everybody understands the danger of cyberattacks, except perhaps Congress, which hasn't acted on legislation yet. But I'm sure they will when they -- when they get back.

And I think what the president was trying to do here, Wolf, was kind of belittle North Korea. Obviously, to answer these questions, and he spoke his mind, I think, quite honestly about Sony, but he was saying, you know, don't they get this was a Seth Rogen comedy?

And yes, we will respond in a proportional way, but I'm not going to talk about it now. It's going to be what he said, at a time and a place of our choosing. So belittling North Korea at the same time saying, "You know what, guys? Come on, we're going to -- we're going to respond."

BLITZER: He also said he was hoping that, despite the fact that Republicans are going to be the majority not only in the House but also in the Senate, there might be in these final two years, as he called it, the last quarter, fourth quarter of his administration, some cooperation. Does that look realistic?

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: There might be some cooperation. But I think at the beginning of the fourth quarter, you're going to see a lot of attention, for sure. Because the first thing that the Congress is going to do, the Republican Congress, is pass the Keystone Pipeline, approving the Keystone Pipeline.

And the president said today in the press conference -- he didn't say it, but he leaned very far into the concept of vetoing that bill.

BLITZER: He didn't say he would.

BASH: He didn't say he would.

BLITZER: He just said this is Canadian oil, not American oil. I don't know if he necessarily appreciated how much he's angering the Canadians, American's No. 1 ally. Why wouldn't he want to help the Canadians? Because that would be a significant benefit for the closest ally the United States has.

BASH: That's true, but I mean, I -- that's probably true. But I think that he's much more focused on U.S. domestic issues than, you know -- than our relations with Canada, which are OK.

But I think that the other thing that I gleaned from what the president said, the "yes, but" on Keystone, was talking about the fact that he doesn't think that it would create that many jobs. But there are job-creating legislative ideas that they have out there, like infrastructure. I know that sounds like, you know, yawner. But this is actually something where you have the most conservative Republicans and the most liberal Democrats already talking about legislation that they can do together to build more roads and bridges. And, you know, that is something that they have bipartisan agreement on.

BORGER: And this is the president. You would have not heard him do his pre-veto about Keystone that he did today during the midterm elections. He's clearly somebody who feels that the burden of all of his tactical responsibilities as the cheerleader in chief for Democrats in the midterms are kind of lifted. And it didn't do them any good, by the way, his restraint.

And now, you know, what you saw today was a president who said, "I have an agenda. I have a legacy. I'm going to go down my list. I'm going to check it. I'm going to get these things done." And I think...

BASH: You've seen it this week with Cuba and everything else.

TOOBIN: If I could just jump in here. You know, look at the three issues he has picked since the midterm elections: immigration reform, the -- global warming, and opening up relations with Cuba, all of which are poor -- popular. His positions are more popular than the Republicans on those issues. So it gives him a lot of freedom that he seems to be enjoying.

BLITZER: Jeffrey, Dana, Gloria, guys, thanks very much.

Just ahead, there are fresh threats against Sony right now. What can the U.S. government do to protect companies from cyber terror?

And as she prepares to leave Congress, is Michele Bachmann rehearsing for a new gig?

(BEGIN VIDEO CLIP)

MICHEL BACHMANN, LEAVING CONGRESS: I look incredible. I wear your granddad's clothes. I got $20 in my pocket. And I'm going to the thrift shop down the road.

(COMMERCIAL BREAK)

BLITZER: Breaking news tonight here in THE SITUATION ROOM on the cyberattack against Sony. Hackers made new threats against the company today shortly before the U.S. officially, publicly accused North Korea of being directly responsible.

Let's bring in CNN's law enforcement analysis Tom Fuentes; our intelligence and security analyst Bob Baer; and our senior media correspondent, Brian Stelter. He's the host of CNN's "RELIABLE SOURCES."

Brian, let's talk a little bit about this statement. You've been reporting all day on the new methods that Sony received from this hacking group, presumably North Korea. What's the likelihood that Sony now will capitulate to these latest demands?

BRIAN STELTER, CNN SENIOR MEDIA CORRESPONDENT: The threat from the hackers last night, Wolf, was sent to a couple dozen Sony executives. It landed in their e-mail boxes. Some of these executives did not open it, because they were concerned about a further hacking, some sort of virus or something.

But what we know the message said was essentially you did the right thing, Sony, you did the wise thing. Now don't you dare release any portion of this movie. The hackers even allegedly said, take the trailer offline. We don't even want to see the trailer online.

But so much has changed. We know that Sony is in new talks with digital distributors to potentially get this movie online. Netflix, for example, has said they are not commenting, but they're not denying the possibility itself.

I think in the next few hours or at least the next few days, Wolf, we may very well hear this movie is coming out.

BLITZER: All right. That's interesting, Brian.

You know, Tom, if the movie doesn't come out, what message does that send to aspiring hackers?

TOM FUENTES, CNN LAW ENFORCEMENT ANALYST: Well, it says we've caved and we'll cave again. But this kind of extortion has been going on for years, for decades, actually. And it's a constant interplay, whether it's an attack on banks or retail stores, or, you know, other institutions, the government itself. So, you know, this has always been a concern for, again, since the early '90s, the threat that this would happen.

BLITZER: Bob, is it fair to say now that cyberterrorism represents the greatest threat facing the United States?

BOB BAER, CNN INTELLIGENCE & SECURITY ANALYST: I think so right now, it does. The fact that this is a state that launched this, not a simple hacker. It was so systemic and it was so destructive, and the fact that it's affected the American media is huge.

And I think the North Koreans right now are capable of doing anything. Remember, this -- I call it a criminal regime. It's almost a theocracy. It's irrational. They are capable of attacking power plants, nuclear plants. And I think that if we escalate, we'll probably see more of it and we are simply not prepared to meet this threat.

BLITZER: Tom, you're a former FBI systems director. Is the government doing enough to protect the American people when it comes to cyberterrorism?

FUENTES: Well, Wolf, this has been a battle for, as I mentioned, two decades of trying to convince Congress and Office of Management and Budget, and everyone that controls the resources for agencies like the FBI, who have said oh, what's the big deal, people can't do it. And the experts on the inside, the agents and technicians that work in cyber have said, look, you know, the United States is the most vulnerable country in the world, because we're so dependent on our computer networks. And if the right hackers penetrate these systems, they could turn us into Somalia. And, you know, that was just considered hype and oh, no, they can't.

We're just seeing one attack on one company. If we had a sustained attack against other elements of the critical infrastructure, you know, it would be horrible.

BLITZER: Brian, let me play another clip from Fareed Zakaria's exclusive with the Sony Entertainment CEO. Listen to this.

(BEGIN VIDEO CLIP)

FAREED ZAKARIA, CNN HOST, "FAREED ZAKARIA GPS": Why not release it online in some form or the other, video on demand?

MICHAEL LYNTON, SONY ENTERTAINMENT CEO: There are a number of options open to us, and we have considered those, and are considering them. As it stands right now, while there have been a number of suggestions that we go out there and deliver this digitally or through VOD, there has not been one major VOD, video on demand distributor, one major e-commerce site that has stepped forward and said they are willing to distribute this movie for us.

Again, we don't have that direct interface with the American public. So, we need to go through an intermediary to do that.

(END VIDEO CLIP)

BLITZER: And, Brian, you're saying that stuff is happening very quickly right now. We could see a major change within hours, right?

STELTER: I think we could. You know, Sony actually owns a Web site called Crackle. But it's only a free online video site. They need someone that will charge people to watch this movie, someone who will help them with the credit cards and the subscriptions. I think those are the talks happening right now here at Sony.

BLITZER: All right. Guys, thank you very much. Brian Stelter, Tom Fuentes, Bob Baer, appreciate it very much.

Up next, Congresswoman Michele Bachmann, she wraps up her career with a little bit of a rap. But first, this "Impact Your World".

(BEGIN VIDEOTAPE)

BODE MILLER, OLYMPIC SKIER/TURTLE RIDGE FOUNDATION: Do you want to sign to the different color?

CHRIS CUOMO, CNN CORRESPONDENT (voice-over): Bode Miller was inspired to start Turtle Ridge Foundation after a close friend suffered an accident that left him paralyzed from the chest down. MILLER: I was trying to help him get revolved in sports and just

to watch him to go through that, I saw how hard it was and how little support there was for him. People who are in a wheelchair or handicapped, we provide the sporting equipment for them and sort of the environment that allows them to participate in whatever sport that is.

CUOMO: Once a year, skiers flock to Bode-fest in on Bode's home turf of Cannon Mountain, New Hampshire, for a day of fundraising and a chance for kids to race the ski icon.

UNIDENTIFIED KID: He is really cool and really fast.

MILLER: These are my super-G skis. For those of you who watch the World Cup this year, that super-G run for me was the best I skied all year.

CUOMO: It's also a chance to test out the latest equipment the foundation has helped develop.

OWEN ANKETELL, ADAPTIVE SKIER: The program's really changed my life. I never thought that I'd be able to ski, but this program has really changed my opinion on adaptive sports.

MILLER: And we built some of our ski equipment and you give it to a kid who never had the chance to go up and experience what it is to ski down a giant mountain and you watch how life changing that can be for them. I think it's really -- it's pretty incredible.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

BLITZER: The outgoing Republican Congresswoman Michele Bachmann is certainly known for a few things, but rapping was not one of them, at least until now.

Our chief congressional correspondent Dana Bash is back with some details.

Michele Bachmann rapping?

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: She wrapped up, pun intended, her time in Congress just this past week. I spent a lot of time over the past eight years asking her tough questions. But in this particular interview, I thought we would show the lighter side of Michele Bachmann, the side that maybe we don't see.

(BEGIN VIDEOTAPE)

BASH: I think I discovered what we're going to do after Congress. You're going to be a hip-hop artist.

REP. MICHELE BACHMANN (R), MINNESOTA: Oh, you found out. My secret is out, totally.

BASH: I nailed it, right?

BACHMANN: Yes, you nailed it, yes.

BASH: So, come on, give me a rap. Let's hear it.

BACHMANN: I look incredible. I'll wear your granddad's clothes, I got $20 in my pocket and I'm going to the thrift shop down the road.

BASH: Anybody got a beat box?

(LAUGHTER)

BACHMANN: So nobody has to worry about competition from me. I'll tell you that.

BASH: OK, is this what you listen to on your iPod? Or is it because of your kids?

BACHMANN: It is the kids. We were on I think Easter vacation and our son Harrison was with us and he was playing this on the radio.

BASH: How old is he?

BACHMANN: Harrison is now 27. And he had it on his iPhone and it was plugged into the car and we thought it was hilarious. So, during the whole time over the break our family was trying to learn the lyrics to "Thrift Shop". And that was the family joke. And so, any way, now it just resurfaced as videotape often will. So, I think it's hilarious.

(END VIDEOTAPE)

BASH: Hilarious, it is. No question about it. She said she doesn't know what she will do next. Guessing it is not a hip-hop career, but we're probably going to see her in some way, shape, or form in politics.

BLITZER: Does she have specific proposals, radio talk show. She's not necessarily, completely ruling out a run for the White House.

BASH: Well, she did for 2016. I asked her specifically.

BLITZER: And she flatly --

BASH: She said she wants to be involved but she's not going to run herself.

BLITZER: All right. Thanks very much for that. Dana Bash reporting.

Let's wrap up this show with something very, very special. I want to take a moment to share with you a few words about a member of our SITUATION ROOM family who is about to start a new chapter in her life. We're talking about Linda Roth. There she is. She is in the control room right now. I have

worked very closely with her for 14 years. And I wouldn't be where I am today without her. She is a legendary producer here at CNN. She's worked at CNN for, what, 26 or 27 years in the control room, in the field. Whenever you see me on TV reporting huge stories around the world, Linda Roth was with me, including war zones, whether in Iraq, Kuwait, all over the world, and most recently, by the way, in Israel. By the way, that's Linda right there, she's running for cover with me from incoming Hamas rockets coming in from Gaza, the sirens were blaring.

I must say, Linda has risked her life way, way too many times to bring all of us the news. She is really an incredible journalist. Wherever we went, I could always count on Linda to make me look good. More importantly than any of that, I could always rely on her to get the story, to get it right.

Linda is an incredibly smart journalist. She's passionate about the news. She never hesitated to ask tough questions or speak her mind. As all of our other colleagues here at CNN know, she is someone who is tough, feisty, always dedicated to her job.

She's got an excellent news judgment. There she is. Linda, look at the camera and smile. Let our viewers see how beautiful you are as well.

Linda Roth, let's give her a big round applause. She's in the control room right there. She's moving on.

And I want to say, Linda, on behalf of all of us here in THE SITUATION ROOM, all of us here at CNN, you will be missed, because it won't be the same working here without you. You've really been an amazing asset to all of us. And as I like to say, I wouldn't be able to do this job without you.

But I'm happy for you and I'm happy you're going to begin the next new chapter in your wonderful life. You've had a great career.

Linda started here at CNN right out of Boston University. She worked her way up from very low-level -- entry-level job at CNN and she's managed to reach this position. She's done an amazing job for all of us.

So, behalf of all of us, once again, thank you very much.

LINDA ROTH, CNN PRODUCER: Thank you, Wolf.

BLITZER: All right. As you remember, you can always follow us on Twitter. You can follow Linda Roth on Twitter as well, @lindarothCNN. Go ahead and follow her. Tweet us at the show. You can tweet me @wolfblitzer, tweet the show @CNNSitroom.

Please be sure to join us again on Monday right here in THE SITUATION ROOM. You can watch us live or your can DVR the show so you won't miss a moment.

That's it for me. Thanks very much for watching. Have a wonderful, wonderful relaxing weekend if you can.

I'm Wolf Blitzer in THE SITUATION ROOM.

"ERIN BURNETT OUTFRONT" starts right now.