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The Lead with Jake Tapper

The Growing Business Of Marijuana; You Don't Know Me!; "The Dream Team" That Wasn't

Aired March 22, 2013 - 16:30   ET

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

JAKE TAPPER, CNN: #Tag you're it. Harvard's NCAA upset brings to mind the old Tom Lehrer song "Fight Fiercely, Harvard". Sample lyrics: "Come on, chaps. Fight for Harvard's glorious name. Won't it be peachy if we win the game?" The new NCAA Cinderella team's actual cheer is, Go Crimson. But I know the Twitterverse can come up with better. Tweet your ideas to @theleadcnn using the hash tag "Harvard cheer."

Should have, would have, could have, there is always a lot of that after a candidate loses a bid for office, but we're learning today about a secret plan that could have maybe put Newt Gingrich and Rick Santorum in the White House, a Republican dream team?

We'll ask these political insiders about it including the reporter who broke the story of the deal and one of the would-be deal makers in our "Politics Lead."

(COMMERCIAL BREAK)

TAPPER: Welcome back to THE LEAD. I'm Jake Tapper. The "Money Lead," pot becoming a booming cash crop. How far we've come from burnouts like cheech and chong as marijuana becomes legal under state laws. Wall Street now wants in.

Also in money according to online advertisers I spend a lot of my time cooking and at bed, bath, & beyond. Despite all the data mining they're doing why can't they figure out the real me or you?

And the "Pop Lead," are you east coast or west coast? This isn't a rap battle. It's the latest in the late night wars and the tug of war over "The Tonight Show."

In the "Money Lead" over the past 40 years or so Hollywood has painted a pretty consistent picture of marijuana enthusiasts.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Man, am I driving OK?

UNIDENTIFIED MALE: I think we're parked, man.

UNIDENTIFIED MALE: You ever seen a woman on weed?

UNIDENTIFIED MALE: All I need is some tasty waves, cool buzz, and I'm fine. (END VIDEO CLIP)

TAPPER: Despite what we've seen in the movies, the cannabis culture has evolved. In fact, thanks to recent laws legalizing marijuana in Colorado and Washington, there are now as many yuppies as hippies signing up to get a piece of the pot pie. The latest issue of "Fortune" magazine takes a look at the big business of marijuana including a network that links weed related start-ups with investors.

I'm joined now by Leigh Gallagher, the assistant managing editor of "Fortune." Lee, thanks for joining us. Let's start with the numbers. Just how much money is being made legally in the U.S. off the marijuana industry?

LEIGH GALLAGHER, ASSISTANT MANAGING EDITOR, "FORTUNE" MAGAZINE: Well, right now estimates put total sales of cannabis as the industry calls it at about $1.5 billion annually. Projections say that could go up to $3 billion by 2014.

That doesn't include the sort of micro economy or cottage industry of accessories that is really exploding. What you're seeing is tons of entrepreneurs, investors really thinking that this industry and everything around it could really be the next big growth industry.

So you have people that really aren't in this for any benefit other than just the financial, which is different from I think what we've seen in the past. So it's really fascinating.

TAPPER: Leigh, medical marijuana. That's been legal in 18 states, but it seems as though the tipping point is this legalization of marijuana in Colorado and Washington last year. Why was that a game changer?

GALLAGHER: That's true. That was a breakthrough of an entirely different order. Even though it was just two states, what happened there was they basically, two ballot initiatives basically made it legal for use of any kind, medical or whatever.

And it also required that states would regulate and license businesses, commercial businesses to be able to sell it and to really regulate it. So basically taxed and regulated the industry. This is much more different than even what is the case in places like Amsterdam where everybody thinks it's sort of, you everywhere.

This is even more expansive than that. This is two states, but people that are believers in the industry really think that this opens the pathway for legalization, you know, in many more states down the road and the opening of a huge industry.

TAPPER: Leigh, your article also mentions this network that links up marijuana startups with investors, but you write that this is not just a bunch of pot heads sitting around sharing ideas. Who are these people?

GALLAGHER: No. That's what's most interesting. That's what shows you that this is really an industry that people have high hopes on. This is a -- this company basically brings entrepreneurs into a room with potential investors and lets them kind of give their elevator pitch and the entrepreneurs can meet with the investors and do deals of whatever kind they want.

The kinds of investors coming to these meetings are basically, you know, people that there's a retired Navy pilot who has no interest in marijuana, has never smoked in his life and is just interested in a way to make money. You have heirs to the Priskar fortune.

You have people from all kinds -- on the entrepreneur side you have, you know, just like you would see in silicon valley, entrepreneurs who just have innovative new technologies that they think will be the next big thing.

In fact, one of the investors sold a startup to a big high tech company in the valley and he is now looking for a place to put that money. It is almost what you would see in any new industry in terms of the flurry of activity around there. It's not just the spicolis.

TAPPER: That's too bad. I liked Jeff Spicoli.

GALLAGHER: I know so do I.

TAPPER: Leigh Gallagher for "Fortune" magazine. Thanks so much for joining us.

GALLAGHER: Thanks for having me.

TAPPER: Apple lovers now, the second longest split second of your life when you drop your iPhone and all you can do is pray to Steve Jobs that it won't land face down. Sometime soon that might be a problem of the past.

The Apple insider has discovered the company has filed a patent for a device that can detect when your phone is in freefall. It will then shift the center of mass so the phone will land on its edge instead of its screen. That's the hope anyway.

What's more annoying than Harvard totally destroying your NCAA bracket? Well, for me at least online ads. They beg you to refinance your mortgage or lose that belly fat that you hope nobody noticed. But those data companies that push those ads your way?

They probably know squat about you. The group "Enliken" put out a survey to give consumers a real sense of how data mining companies view them and respondents found that up to half of what they know is wrong. Now I now know the pain personally.

Earlier I spoke with Marc Guldimann, the cofounder of "Enliken" and he explained just how these companies can be so off base.

(BEGIN VIDEOTAPE)

TAPPER: So, Mark, I filled out your survey and here is everything they got wrong about me. They say I am a college student, a community activist, a family chef, a home decor shopper, which my wife would definitely disagree with having gotten rid of my last bit of home decor the James Bond poster that I had framed from my 20s, and a trendy homemaker. That's what they say about me. How can they get it so wrong?

MARC GULDIMANN, CO-FOUNDER, "ENLIKEN": It turns out that they are gathering this data and sort of round about ways and they're inferring a lot of things that they're selling to advertisers about you. For example, you might read a news article about home decor.

You might read an article about a new convertible. And either of those things would say to somebody trying to sell data to an advertiser that you're in market for either of those goods. So because they have such hard time gathering information about you, they end up sort of inferring a lot of things pretty loosely.

TAPPER: How big of an industry is data mining? We hear so much about it. Is it burgeoning? Where are we in the development of this industry?

GULDIMANN: Well, digitally it's growing like crazy. Offline it's been a huge industry for a long time. I mean, Axiom and Equifax, and those guys have been dealing in personal data for a long time.

TAPPER: How do they do it? They do it with tickets and receipts and things on your credit card bill?

GULDIMANN: When you subscribe to magazines and, you know, anything you sort of, in the real world when you give somebody your identifiable information a lot of times that's re-sold.

TAPPER: How concerned should the average consumer be about privacy? Is it just like one flick of the switch and they can find this customer number 734 who they know likes bed, bath, & beyond and turtle wax, they just flip a switch and find out that it's me, or is it much more complicated than that?

GULDIMANN: I think there are a couple questions you have to ask. The first is what is privacy? A lot of people online today confuse anonymity with control. When people say privacy a lot of times they mean they want control over all of the information, which is being used to target them with ads.

They want visibility and they want transparency. They don't mean that they want to be totally anonymous. In fact, when you look at social media and you look at a lot of the mobile tools people are using they're broadcasting lots and lots of information about themselves. The only difference is they have total control over it.

TAPPER: See the thing is I probably wouldn't mind them knowing some things about me that are accurate.

GULDIMANN: Exactly.

TAPPER: I wouldn't mind them knowing where I went to college and the sports teams I like. Maybe I would be offered, you know, shirts and hats for my kids. GULDIMANN: Right.

TAPPER: But instead, what they got about me was completely off.

GULDIMANN: Right.

TAPPER: I'm not a college student. I am not into home decor. I mean, is there any way for me to fix it?

GULDIMANN: One of the things we're trying to do as "Enliken" is help businesses engage directly with customers for their data. So we think if a business goes directly to a customer and asks them can you please tell me the things you're in the market for, the brands that you have affinity towards. They're going to get much more high quality data and it will be a much more authentic conversation between the brand and the customer.

TAPPER: All right, Marc Guldimann, co-founder of "Enliken." Thank you so much for joining us.

GULDIMANN: Thanks for having me.

TAPPER: Bill Clinton is always there to help out his fellow Democrats and this time it's two women running for the same seat. Who is the former president calling? Our political lead is next.

(COMMERCIAL BREAK)

TAPPER: Now to our "Politics Lead." The so-called dream team that never happened, I know a lot of people who make their living predicting political outcomes, but in the Republican primaries last year I do not recall anyone seeing this coming.

A unity ticket between two unlikely presidential hopefuls and it almost rocked the race to the White House. Erin McPike, hindsight is 20/20, but would this have really made a dent in the way the primaries went down last year?

ERIN MCPIKE, CNN CORRESPONDENT: If you think about the general election, which is what they're talking about, you know, Democrats just devoted all of their time to researching and preparing for a Mitt Romney candidacy so it would have slowed them down. But for some voters out there this just might have been a dream that was too good to be true.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: That I will faithfully execute --

MCPIKE (voice-over): What if President Obama had faced him and him in last year's election? Who would be living here? During the Republican primary, Rick Santorum and Newt Gingrich just couldn't see eye to eye and they trained their sights on each other.

RICK SANTORUM, (R), FORMER PRESIDENTIAL CANDIDATE: At times you just sort of, you know, that worrisome moment that something is going to pop and we can't afford that in a nominee.

NEWT GINGRICH (R), FORMER PRESIDENTIAL CANDIDATE: I think long before Rick came to Congress I was busy being a rebel. Those are just historic facts even if they're inconvenient for Rick's campaign.

MCPIKE: But soon they stopped snipping at each other and started sniping at Romney. Before long, both men had dealt serious blows to the frontrunner. Santorum with the surprise squeaker in Iowa followed by a Gingrich win in South Carolina.

Suddenly, Mitt Romney was on the ropes. A Gingrich adviser went to the Santorum camp. Would the senator join the speaker on one ticket? No. Santorum was surging and wanted his own shot, but they still became strange bed fellows.

GINGRICH: I agree with Rick's point. I would urge the states then to return most of the power back to the local communities and the third thing we bought, which Rick alluded to which is really important.

SANTORUM: As Newt said the real fundamental issue here is government coercion.

MCPIKE: Then the tables turned. Santorum's top aide went to Gingrich's henchmen with a proposal. Join their team to topple the tycoon. Santorum and Gingrich started conspiring by phone. They even huddled in person, but they couldn't resolve the biggest issue of all. Who would lead the ticket?

(END VIDEOTAPE)

MCPIKE: And for the two big egos vying for their piece of history, the rest is, well, history, but wait, wait. There is more. Some Gingrich advisers today are taking issue with the back story the way the Santorum campaign is talking about it.

Adviser Kevin Kellums gave CNN this statement. The idea a week later it was Speaker Gingrich who wouldn't consider creative options to stop Governor Romney doesn't square with history in the same manner that victory has a thousand fathers defeat has legions of weak memories.

And, Jake, I talked to another Gingrich adviser today who said that one of the meetings between Gingrich and Santorum was, quote, "awkward."

TAPPER: I could imagine it being awkward. I thank you very much Erin Mcpike. We'll bring in our political panel, which has some big players here to talk about this, the dream team that never was.

Former adviser to Rick Santorum, John Brabender joins us also former advisor to Hillary Clinton's campaign Kiki McCain and the guy who broke the story and got a thousand tongues wagging about it, Josh Green, senior national correspondent for "Bloomberg Business Week."

So John, I start with you because you were the one negotiating here. So what happened? How close was this to becoming a reality? JOHN BRABENDER, REPUBLICAN STRATEGIST: It's interesting. I feel like I'm somebody who just came from an auto accident or something listening to everybody else who wasn't there described it and I was.

TAPPER: Describe the auto accident.

BRABENDER: Well, interesting enough, what really happened is that at some point it became clear that it was going to be Mitt Romney versus an alternate and the alternate was going to be a conservative.

And, really, this thing started a little bit before Michigan when Rick Santorum on one night won Missouri, Colorado, Minnesota, went to the head of the national polls, and it really in all the polls for Santorum versus Romney.

I've known a lot of these Gingrich people for years. They're friends of mine. We started to have a discussion of what if we could get a unified, conservative ticket? And the ticket wasn't necessarily Santorum and Gingrich.

It was Santorum and getting everybody from Michele Bachmann and Perry and Gingrich and even Sarah Palin to start coalescing behind Rick Santorum and starting to campaign with him.

And then the Gingrich people said very clearly, look, Newt still has hopes of winning either Alabama and Mississippi. They're desperate states for him. He has to win them. Santorum won both those states as you probably remember.

TAPPER: Yes, I do.

BRABENDER: And the discussions intensified where there was some very serious talk about Newt getting out, supporting Rick Santorum, and doing this sort of conservative unity campaign. In the end, you know, I got called and said that Newt thought it over and decided that he wanted to concentrate on the states he thought he could win and let Rick concentrate on the states he thought he could win.

Specifically I asked what states that would be that Newt could still win and they said Wisconsin, which, you know, but in fairness to Newt, when you're in a presidential race you have to get up every day and every morning and tell yourself things are going to change and I'm going to win. And it didn't work out but that is sort of the story as it really happened.

TAPPER: Josh, mathematically, did you ever try to figure out that if they did unite, whether or not they would have been able to --

JOSH GREEN, "BLOOMBERG BUSINESSWEEK": Well, that is the really fascinating angle. Nate Silver of the "New York Times" fame statistician and other things in March did do a look ahead and said in fact if did you remove candidates Romney performed worst.

He didn't quite have Santorum winning. But to me the key was this was all happening or at least the initial talks as I understood were happening in the weeks leading up to the pivotal Michigan primary. Where it looked for a moment like Mitt Romney was going to lose his home state. Had he lost it all bets would have been off and it isn't clear who would have emerged as the nominee.

TAPPER: It's too bad the math wasn't done. That is interesting. Kiki, there was talk, you are former adviser to Hillary Clinton.

KIKI MCLEAN, FORMER SENIOR ADVISER, HILLARY CLINTON FOR PRESIDENT: Yes.

TAPPER: There was talk of the need for the same thing in 2008 for Obama and Hillary to unite. There is always an attractive quality to this sort of thing. It's a little different of course.

MCLEAN: Yes. Look, there --

TAPPER: Why is it so tough?

MCLEAN: Ultimately never say never is the art of politics because truly anything is possible, but the concept in primaries, there's always sort of this high wire act. If we go negotiate, we will dramatically change the course. And it really doesn't happen very often.

And so you find out about these sorts of high wire moments when someone tried to do something like that. Now, it's different when you talk about Secretary Clinton making the decision to go ahead and end the primaries.

That was about her supporting the nominee. It wasn't about a coalition to try to propel someone else forward and that's a big difference. But it happens on both sides. We've all been part of the conversation.

GREEN: The two candidates themselves talking face to face and usually this is the providence of pundits.

MCLEAN: And the act gets even higher on the wire when it's the two candidates.

BRABENDER: What everybody is missing is how close Rick Santorum came to actually almost being the nominee. He lost Michigan by a few votes. Go into Ohio the big state, loses by 10,000 votes. He ended up winning 11 states and tying two others out of 30 when he had a one on one with Mitt Romney like Missouri Rick Santorum not only got 55 percent of the vote but won every single county.

TAPPER: Josh, I just wonder, a guy like Newt Gingrich, does he feel that it's better to have -- because there was all this debate about who would be on the top of the ticket. Does he feel it would be better to have President Obama and Joe Biden in there today or Vice President Gingrich? Looking back on it does he regret not having taken the second slot?

GREEN: I think that would be a tough question for him to answer. When we talked about this he wasn't really in the mood to second guess. I think he was, you know, proud of the campaign he ran, had hoped to emerge as a nominee, didn't, but might have another run in him.

MCLEAN: Why do you think he decided to tell this? That's what I want to know. You know, I saw your intrepid reporting.

TAPPER: Because Josh is an excellent reporter. We have to leave it there. All right, already planning your trip to New York for Jimmy Fallon's debut on "The Tonight Show?," not so fast. The mayor of sunny Burbank is not so happy and he is putting up a fight. That's our pop lead and it's next.

(COMMERCIAL BREAK)

TAPPER: The pop culture lead. There is another tonight show tug of war brewing not over the hosts this time thankfully but the zip code. The "New York Times" first reported Jimmy Fallon would take over the show from Jay Leno in 2014 and that would also mean a move from what Johnny Carson once dubbed beautiful downtown Burbank to New York City.

But the mayor of Burbank says not so fast. He's writing a letter to NBC executives to keep the show in his town. He could face an uphill battle given recent reports that New York is offering tax incentives to lure the show back to the big apple.

As far as who would replace Fallon after he moves on up in the line up, the "New York Post" said NBC could dip into the "SNL" pool once again, the great Seth Meyers is rumored to be the top man for the job. CNN reached out to NBC, but the network is not commenting.

It was 50 years ago today when pop culture changed forever. Today is the 50th anniversary of the release of the Beatles' first album, "Please Please Me." The LP hit shelves in Britain on March 22nd in 1963. Sales started out slow, but it would hit number one in May. The British invaded and the Beatles never looked back and neither did society.

"Game of Thrones" fans you still have a full week plus to wait for the premiere of season three, but we can help you get your fix before then. Don't miss my interview next week with "Game of Thrones" co- creator David Benioff and of course, I'll try to pry a few secrets out of him about the upcoming season.

We asked you earlier to come up with a new cheer for Harvard's basketball team. Go Crimson! At least we've got most of the Supreme Court. Don't be sad. Don't be blue. We beat you and we're smarter too.

That does it for our very first week of THE LEAD. Join me on Monday at 4:00 p.m. Eastern when we'll do it all over again. I leave you now in the able hands of Mr. Wolf Blitzer in "THE SITUATION ROOM."