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Penn State Board Fires Paterno; Cain Fends Off Harassment Claims; Rick Perry's Devastating Stumble; Jobless Claims Hit 7-Month Low; Wall Street Looks to Rebound; News Corp Phone Hacking Scandal; Powerful Storm Slams Alaska; "Occupy" Protest at UC Berkeley; New Nixon Watergate Files; Troops' Ashes Dumped in Landfill; Fact-Checking Romney on Mortgage Mess; Paterno Meets Students after Firing; Eddie Murphy Quits as Oscar Host; Tom Bradley Takes Over for Paterno; Boosting Minority-Led Tech Firms; Cain Fends Off Harassment Claims

Aired November 10, 2011 - 10:00   ET

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

KYRA PHILLIPS, CNN ANCHOR: And we are reaching just about the top of the hour now. Thanks so much for joining us.

We are beginning with this stunning announcement from the Penn State board of trustees. It rocked the campus last night.

(BEGIN VIDEO CLIP)

JOHN P. SURMA JR., VICE CHAIRMAN, PENN STATE BOARD OF TRUSTEES: The board of trustees and Graham Spanier have decided that effective immediately Dr. Spanier is no longer president of the university. In addition, Joe Paterno is no longer the head football coach effective immediately.

(END VIDEO CLIP)

PHILLIPS: Now, once the word was out, hundreds of students spilled into the streets. The rally was mostly peaceful, but some people even turned over a news van. Police dispersed the crowd early this morning.

CNN's Jason Carroll joining from us State College, Pennsylvania. Jason, what exactly are you hearing from students today?

JASON CARROL, CNN NATIONAL CORRESPONDENT: Well, obviously, today if you look around thing are much, much calmer, but last night much different story here. You know, it is interesting, Kyra, even as you played that sound bite when the announcement was read about what the board of trustees was going to do.

You heard the audible gasp even there at the press conference when they said that Joe Paterno was out. Well, once word got out on the streets right out here at old main and downtown, students here obviously were very angry, very upset.

And they took to the streets. They took a lot of their anger out actually on the media. Their feeling among many of those students who are here was that the media was not paying enough attention to the man at the center of the scandal.

That would be Sandusky. They felt as though basically too much attention was being placed on Paterno. I just want you to listen to what some of the students had to say last night.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: They are going after the wrong guy and the justice system --

UNIDENTIFIED FEMALE: Pretty much making stand because we are in support of our school and support of Joe Pa. We think it is absolutely ridiculous that he got fired over this situation.

UNIDENTIFIED FEMALE: I think some people are making a mistake of putting Joe Pa in front of the actual situation. UNIDENTIFIED MALE: Tears actually the second -- I wiped them off now. But the second I heard it, tears were in my eyes. He has done so much for on our university.

(END VIDEO CLIP)

CARROLL: Well, that wasn't the only place students showed up, Kyra. As you know, they also showed up at Paterno's home last night, obviously, things much calmer there, but just as much emotion, but emotion in a different way.

Joe Paterno and his wife came out and spoke to the students who gathered in front of his home. The statement that he released is basically says, I am disappointed with the board of trustees' decisions, but I have to accept it.

A tragedy occurred and we have to have patience and let the legal process proceed. Now obviously, there are a number of people who are upset with this decision, but that doesn't mean there are students here at Penn State who support what the Board of Trustees decided to do with regard to Joe Paterno and the former President Graham Spanier.

Those students say that their voices are not being heard, but they are hoping their voices will be heard later on today just at about 12:30 right here at Old Main. There's going to be a gathering of students to speak just about that -- Kyra.

PHILLIPS: All right. Jason, thanks so much. I had a chance to talk to T.J. Bard. He's the Penn State Student Body president. He told me last hour that the focus at Penn State really needs to go way beyond Joe Paterno.

(BEGIN VIDEO CLIP)

T.J. BARD, PENN STATE STUDENT BODY PRESIDENT: I think emotions run the gamut in terms of Joe Paterno. I think the university officials in general, I think, lot much students obviously are in support of Joe Paterno.

But I also think a lot of students are realizing that there may be more to the story than we realize. At the end of the day, fundamentally what matters most is that justice is found for the victims and their family. And they can truly find some closure after all of this.

(END VIDEO CLIP)

PHILLIPS: We are going to get back live to Penn State in just 25 minutes after the hour. I'm actually going to talk to CNN's Sarah Hoye who has been there since last night when Joe Paterno came out and greeted the students.

All right, now to the Republican presidential debate. Two candidates who are generating a lot of buzz around the water cooler on this morning after, Rick Perry stumbling and Herman Cain getting scrappy.

Let's begin with Cain and sexual harassment scandal that surfaced early in the showdown.

(BEGIN VIDEO CLIP)

HERMAN CAIN (R), PRESIDENTIAL CANDIDATE: I value my character and my integrity more than anything else and for every one person that comes forward with a false accusation, there are probably -- there are thousands who would say none of that sort of activity ever came from Herman Cain.

(END VIDEO CLIP)

PHILLIPS: Now the implosion of one-time frontrunner Rick Perry for a minute. Perry stammered, squirmed, and as he tried to remember his own plan to shrink government.

(BEGIN VIDEO CLIP)

GOVERNOR RICK PERRY (R), PRESIDENTIAL CANDIDATE: It is three agencies of government when I get there that are gone. Commerce, education, and -- the -- what's the third one there? Let's see?

UNIDENTIFIED MALE: So you can't name the third one?

PERRY: The third agency of government, I would do away with education, the -- commerce, and let's see. I can't. The third one, I can't. Sorry. Oops.

(END VIDEO CLIP)

PHILLIPS: Wow. Jim Acosta is in Albert Hills, Michigan. Jim, a bit awkward to say the least, how does Perry's campaign recover from this?

JIM ACOSTA, CNN POLITICAL CORRESPONDENT: Well, it is going to be tough, Kyra. I mean, you can just go to Twitter this morning and look at some of the phrases that are being tossed around to describe what happened to Rick Perry.

Oops, he did it again, being one of them referring to the fact that the Texas governor has had shaky debate performances before last night. So the question is how does he recover from this?

You know, Governor Perry has been doing the morning talk shows this morning trying to do damage control. He says he will continue on with this campaign. He is even inviting his supporters to visit his web site where he's trying to inject humor into this gaffe.

By asking which department of the federal government would you like to forget? But, you know, he has a lot of money in the bank right now, Kyra. So he does have the funds to keep this campaign going. But he said earlier today, on CNN's "AMERICAN MORNING," that he has no plans to go anywhere.

(BEGIN VIDEO CLIP)

PERRY: Obviously, I stepped in. But again, I go -- I have my moment of humor with it. I press on and understand that there are a lot more serious things facing this country than whether or not I could remember the Department of Energy at a -- inappropriate time.

(END VIDEO CLIP)

ACOSTA: You know, still -- but that moment is being compared to the Dean Scream from 2004 to Admiral Stockdale's line in 1992, who am I? Why am I here? This moment from Rick Perry in last night's debate is really going to be part of that, you know, greatest hits or not so greatest hits from presidential debate history.

If there is one benefactor in all of this, it is Herman Cain. As you mentioned, Kyra, you know, for about a week and a half, nearly two weeks, he's been reeling from accusations of sexual harassment.

That moment last night in the debate when the moderators asked him about those accusations and the audience booed the question and then cheered his response, it was an indication that Republican voters may be giving Herman Cain a bit of a pass at this point. They may allow him to keep this campaign going.

PHILLIPS: All right. Jim Acosta, we're going to talk much more about the fallout and we'll have more on the Republican debate in just a few minutes.

CNN's Martin Savidge is actually going to do a fact check on some of the things that were said last night.

Wall Street looks like it is ready to rebound from yesterday's big fall. The Dow lost nearly 400 points, but today the focus is on those new jobless figures that are better than expected. Right, Alison Kosik?

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Exactly. That's because, Kyra, the jobs picture is looking a little brighter this morning. Because there is a new sign that the number of people being laid off is slowing.

The 390,000 people filed for first time unemployment benefits last week. That's actually the lowest in seven months. About 390,000 seem like a lot of people. It is. You look at the comparison of what happened during the depths of the recession when we saw new claims above that 600,000 mark.

So essentially what you are seeing is a steady decline since then. But the key here is we need to see that number stay below 400,000 and you know what, that's questionable considering the state the global economy is in.

European debt crisis still is not under control. There is more talk of a double dip recession over there in Europe that could affect the U.S. economy, but today, Kyra, it is all about the positive.

It is about a rebound. The Dow is up 112 points. The focus is on those improving jobs numbers and on optimism that Europe can possibly get its act together -- Kyra.

PHILLIPS: All right, Alison, thanks.

James Murdoch is back in the hot seat this morning. The British parliament is still investigating his role in the phone hacking scandal at the now defunct "News of the World" tabloid.

CNN's Max Foster has been following all the testimony from London. All right, so what's the latest, Max?

MAX FOSTER, CNN INTERNATIONAL CORRESPONDENT: Well, it really was a hot seat as you say, Kyra, today. He was under immense pressure as he faced grilling from lawmakers about how much he knew about phone hacking at the "News of the World."

One of his titles now closed down. He accepts it did take place, but the argument here is whether or not he knew about it. He says previous executives appearing in this panel were wrong to say he knew about it.

He didn't know about it. But let's just get a taste of what pressure he is under. This is Tom Watson. You will know him from previous grillings of the Murdochs. Let's hear what he had to say to James Murdoch today.

(BEGIN VIDEO CLIP)

TOM WATSON, LABOUR PARTY DEPUTY CHAIRMAN: You must be the first Mafia boss in history. You didn't know he was running a criminal enterprise?

JAMES MURDOCH, CEO, NEWS INTERNATIONAL: Mr. Watson, please, I think that's inappropriate.

(END VIDEO CLIP)

FOSTER: And many people do agree that -- perhaps Tom Watson pushed eight bit too far on that. But Tom Watson interestingly, we heard this week, was spied on by "The News of the World," surveillance on him along with Prince William and Angelina Jolie. He has a personal involvement here as well, but a very tough appearance to James Murdoch. Shareholders will make their judgment whether or not he survived it. He's under pressure from them as well.

PHILLIPS: Can I ask you a question, Max? What is on everybody's lapel?

FOSTER: That's a poppy. It's to remember Britain's war dead. This time of year there is a remembrance service this weekend. Everyone wears poppies. You pay money to get a poppy and it goes to war veterans.

PHILLIPS: Got it. All right, thank you so much for clarifying that. We have our own Veterans Day coming up this week as well. Max, thanks.

Well, U.S. troops killed in combat, their homecoming sombre and respectful. But what happened afterwards is stirring new shock and outrage. A veteran shares his anger.

What was it like outside of Joe Paterno's house after his firing? We are going to talk with our own Sarah Hoye who was there last night.

And he's a smooth debater, but is he right? We are going to fact check Mitt Romney's take on the housing crisis.

(COMMERCIAL BREAK)

PHILLIPS: Taking a look at news cross country now.

One of the strongest storms in nearly 40 years is slamming western Alaska. Some areas are experiencing whiteout conditions, even 10-foot waves. Hurricane force winds are topping 80 miles an hour.

In California, police and riot gear ordered a group of protesting tuition hikes to take down tents on the Berkeley campus last night. The students formed a human chain by linking arms. You can see police using their batons to shove forward to reach the camp. There were several arrests.

National Archives will release new Richard Nixon files including transcripts of the former president's grand jury testimony in 1975. It's less than a year after he resigned because of the Water Gate scandal.

OK, this next story is shocking. As it is -- well, it is just as shocking as it is sickening. The cremated body parts of fallen U.S. soldiers, Marines, and sailors, we have learned have been treated like garbage.

Their ashes routinely dumped in a landfill. It has been exposed and we are talking about more about this more with Paul Rieckhoff, he's the founder and director of the group Iraq and Afghanistan Veterans of America.

Paul, you know, you've lost plenty of buddies in combat. How do you respond to the military's explanation that these ashes were treated like medical waste and disposed of accordingly?

PAUL RIECKHOFF, DIRECTOR, IRAQ AND AFGHANISTAN VETERANS OF AMERICA: It's absolutely outrageous. It's disgusting. It's a national embarrassment. The entire veterans community around the country and around the world is just floored by this.

There is no way you can possibly explain this. I mean, when you are doing this kind of work, the margin of error is zero. There are a lot of folks at Dover who takes tremendous pride in their work.

But whatever happened here is absolutely inexcusable. We owe a full explanation and full investigation to the families and to everyone in the military community that is impacted by this.

PHILLIPS: So first it was Arlington Cemetery and now this. I mean, I can't tell you how many people with whom I have spoken and high-ranking military circles that are speechless about this. I mean, how did it even get to this point?

RIECKHOFF: We have to find out. I mean, the president should find out, Congress should find out. I mean, it started with Arlington. Once you erode that trust, there's really no rebuilding it. So you have to think there have been over 6,300 people killed in combat in Iraq and Afghanistan since 9/11.

That's 6,300 families who should never, ever have to worry about something like this. You know, today is a Marine Corps birthday. Tomorrow is Veterans Day. So this is happening at a really inopportune time.

And the one thing I would say is that people frustrated, outrage, definitely call for accountability, but also stand with the veterans community tomorrow. We will be organizing veterans around the country in Chicago, Atlanta, New York, and San Francisco.

Come out and join us and try channel that frustration and put interest behind the veterans because this is definitely -- it hurts. But we -- to know people are behind us and support us and want to continue to push on. That's going to help us rebuild and move forward.

PHILLIPS: So, Paul, the military says that the cremated remains are no longer dumped into the landfill. Instead they are now being buried at sea. Is that enough?

RIECKHOFF: No. It is not enough. They should be doing that. That's good to hear, but that's no explanation of what happened before. So, you know, this can't be a blip on the news cycle. I mean, you got to think about that mother who is trying to make sense of this right now. Who's trying to understand how this could possibly happen. We have a solemn pact with our folks who serve overseas to take care of them, to take care of their families and to honor their service and this doesn't do that.

So they are owed the full explanation and even from the president. I mean, he's got to explain this to those families, those individual families, who should never have to deal with this.

PHILLIPS: Well, it will definitely not be a blip on the radar for us. Our Barbara Starr is going to stay on the story, the investigation at the Pentagon.

I will, too, as well. You know how I feel about our vets especially our wounded and fallen warriors. Paul Rieckhoff, thank you so much. Really appreciate it.

RIECKHOFF: Thank you, Kyra, so much. We appreciate it. Thanks for keeping a spotlight on it.

PHILLIPS: Always.

And here is a statement that we did get from the Air Force, issued this on the policy change, quote, "In December 2008, the director recommended to the Central Joint Mortuary Affairs Board that the services implement a retirement-at-sea option to effect disposition as a more respectful and dignified process. The retirement at sea process was adopted and appropriately respects the dignity of our fallen warriors," end quote.

Coming up, the CNN "Troop Squad," fact check the candidates' claims on last night's Republican debate. We will see if Mitt Romney really knows who is to blame for the nation's mortgage mess.

What was it like outside Joe Paterno's house after he got fired? We are going to talk with one of our own who was right there.

(COMMERCIAL BREAK)

PHILLIPS: Last night, the Republican candidates for president faced off in yet another debate. For two hours, they tackled questions about the economy and our "Truth Squad" was there fact checking everything they had to say. Martin Savidge joining us with what we found out -- Martin.

MARTIN SAVIDGE, CNN CORRESPONDENT: Good morning, Kyra. Well, there was a lot of talk last night about who was to blame and how we got into the financial mess we are in as far as, you know, the great recession.

So we decided to see if the fingers that were being pointed were actually being pointed in the right direction. So we want to start now with former Massachusetts Governor Mitt Romney and what he had to say about the mortgage mess. Take a listen.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: When you have government play its heavy hand markets blow up and people get hurt. The reason we have the housing crisis we have is the federal government played too heavy a role in our markets.

The federal government came in with Fannie Mae and Freddie Mac and Barney Frank and Chris Dodd told banks they had to give loan to people. They couldn't afford to pay them back.

So our friends in Washington today, they say, if we have a problem in housing, let's let government play a bigger role. That's the wrong way to go.

Let markets work, help people back to work. Let them buy homes. You will see home prices come back up if we allow this market to work.

(END VIDEO CLIP)

SAVIDGE: OK, so the implication there is that the government triggered the housing crisis through the federally backed mortgage giants, such as Freddie Mac and Fannie Mae. But basically what they are saying is that they made it too easy for people to go up and get loan for a house.

Maybe people that really shouldn't or couldn't afford to get a home loan, is that true? Well, what do you know? This was actually the focus of a specific group called the "Financial Crisis Inquiry Commission" of 2010.

It's basically a 10-member panel that was approved by the U.S. government with the specific job of investigating the cause of the economic crisis of 2008. In its report in 2011, it found that Freddie and Fannie did, in fact, contribute to the crisis, but they were not as they put it, not the primary cause of the crash.

The commission actually said that Fannie and Freddie's delinquency rates were lower actually than the delinquency rates found with private firms and the report actually blamed that the greater blame really was on the relaxed mortgage lending standards of the private lenders. So in other words here, it was not so much the government verdict here. It was what was happening in the private sector.

What do we find? Pretty much that Mitt Romney's statement was false. The extensive investigation since 2008 and the housing crash that since that most of the blame is put on the private lenders, not on the government regulators here.

He was quoting and many people have pointed at Freddie Mac and Fannie Mae. But what they are doing is pointing in the wrong direction -- Kyra.

PHILLIPS: All right, Martin Savidge with our fact check. Appreciate it, Martin. Well, you've heard the expression. Imitation is the sincerest form of flattery. Well, I'm not so sure?

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I'm Herman Cain, the man shouting number nine. I used to be CEO of Godfather. Slow growth. Make my children hate pizza.

(END VIDEO CLIP)

PHILLIPS: Yes. That's Mike Tyson. We will explain in our "Political Buzz" next. You won't want to miss it.

What was it like outside of Joe Paterno's house after his firing? We will talk with our Sarah Hoye. She was there.

(COMMERCIAL BREAK)

PHILLIPS: Well, it was an emotional scene outside of Joe Paterno's home after he was found -- after he found out that he was fired. Our own Sarah Hoye was right there when the announcement was made and the students basically, Sarah, responded immediately. Tell us what you saw and what that moment was like.

SARAH HOYE, CNN CORRESPONDENT: That's right. Last night in front of Joe Paterno's home, about 15 to 20 students showed up after it was announced he had been fired. The mood was very, very sombre and very, very calm.

There was even a little instance when they did cheer for him. Now I do believe we have some video for that. So if we have it, let's go ahead and take a listen.

(BEGIN VIDEO CLIP)

JOE PATERNO, FORMER PENN STATE FOOTBALL COACH: Look, get a good night's sleep. All right. Study, all right? We still have things to do. All right, I'm out of it maybe now. We'll go from there. One thing, thanks and pray a little bit for those victims.

(END VIDEO CLIP)

HOYE: So we have been right there with just that little emotional outburst there at the end that we love you, Joe. We love you, Joe. That was really much it for in front much his house.

Other than that it was very quiet. Like I had said, very, very sombre and the students were there just kind of milling about. It was a very, very small group of people. Joe did come out and speak with them.

PHILLIPS: I had a chance to speak with the student body president. I wanted to ask him about -- you know, how many students are out there within the mix? We are seeing all this support for Joe Paterno and the football program, but what about the sex abuse victims? You know, are there students out there trying to be a voice for that, which in many instances has seemed to have gone -- forgotten.

And he said he's seeing actually a shift that more students are speaking out about that. What have you seen heard? Do you feel the same way?

HOYE: Well, you know, Kyra, it is interesting you mentioned that because this morning, as the students were going to class, because here on campus if you can see around me it is pretty much business as usual.

And as they were going to class, we did speak with a few of them just to kind of gauge how they were feeling. What are they thinking about? How does this affect them? Is it really all about Joe? Is it really just about football?

Those students will tell you, no. That there are these victims involved. These alleged victims, that there is a grand jury report. There are very, very much aware as to what that is. Even in the student newspaper today, there is an editorial, the fall of the giants, in which this editorial is calling for the students to actually step up to the plate, step up to the challenge because we are Penn State. They want the students to kind of help rebuild the system that in a sense some of them are saying failed. Whether it is from the football, whether it's from the cover up, whatever it was.

So the students here are very aware, not only about this beloved coach who has been there for decades who is let go, but also what this means in light of this potential scandal.

PHILLIPS: Sarah, thanks.

And we're going to talk about what's next for Penn State football program and Joe Paterno. NPR sports correspondent Mike Pesca joining us in just about ten minutes.

All right, it's time for "Political Buzz"; your rapid fire look at the best political topics of the day. Three questions, 30 seconds on the clock. And playing today Robert Zimmerman, member of the Democratic National Committee; Patricia Murphy, founder and editor of Citizen Jane Politics; and CNN contributor Will Cain.

All right, guys let's get right to it. Rick Perry's embarrassing moment at last night's Republican presidential debate. Here it is.

(BEGIN VIDEO CLIP)

RICK PERRY (R), PRESIDENTIAL CANDIDATE: And I will tell you it's three agencies of government when I get there that are gone. Commerce, education, and the -- what's the third one there? Let's see.

RON PAUL (R), PRESIDENTIAL CANDIDATE: You need five. PERRY: Oh five. Ok. So commerce, education and the --

UNIDENTIFIED MALE: EPA?

PERRY: EPA. There you go.

UNIDENTIFIED FEMALE: Time is up, time is up.

UNIDENTIFIED MALE: Seriously?

(END VIDEO CLIP)

PHILLIPS: That's the big oops moment, as it is being called. So is Rick Perry finished -- Patricia?

PATRICIA MURPHY, FOUNDER AND EDITOR, CITIZEN JANE POLITICS: If Rick Perry wasn't finished before this, I think you've got to believe that he is finished now. Plus a lot of people after this happened the main question they had coming out of it, was why are you even running for president? You don't know exactly what you want to do.

And this was not a pop quiz, this is not a trick question. This was not the name of an obscure foreign leader. This was what are the three agencies you want to get rid of. And it's an issue he raised himself. This gets to the point that if he is going to be on the national stage as president, he needs to be able to be on a debate stage as a candidate, he cannot do that. So I do think that this is really the end of it for him.

PHILLIPS: Will?

WILL CAIN, CNN CONTRIBUTOR: He might be finished, Kyra, but it shouldn't be for this. And for two reasons. One, we've all done this. Everyone can identify with a situation like this where your mind just simply goes blank. I've done it sitting right here at this desk. People at home have done it talking to their friends.

Rick Perry's campaign might -- should be finished but not for that reason which brings me to my second point that I will remember which is in giving them plenty of substantive reasons not to support Rick Perry. The least of which is crony capitalism. His -- his reign as governorship in Texas has been connected to appointing friends, favors and positions throughout the state. The point is Rick Perry's campaign should be finished but not for a bumble on the stage.

PHILLIPS: Robert?

ROBERT ZIMMERMAN, DEMOCRATIC NATIONAL COMMITTEE: Well, first of all Kyra, I've never seen Will Cain's mind go blank ever in all of the segments I've done with him. So but the more important point is look, over -- Rick Perry's three months as a candidate, he's came back from the dead more than Dracula.

But this is different because ultimately he couldn't remember his core convictions. He couldn't define his reasons for running. That's why like -- what Patricia said is correct, Rick Perry is finished. PHILLIPS: All right, guys I don't know if you've actually seen the Web site, FunnyOrDie.com. But Mike Tyson sure does a mean Herman Cain.

(BEGIN VIDEO CLIP)

MIKE TYSON, FORMER BOXER: Chocolate may be the flavor of the week. But crazy is the face of Republicans never tie up, I want to be your president because this Cain is able. And if you give me time, I will make you a fable.

UNIDENTIFIED FEMALE: I am America --

(END VIDEO CLIP)

PHILLIPS: Ok. Let's reverse roles now. Did Herman Cain win the fight to get his reputation back last night? Robert?

ZIMMERMAN: No, he didn't. And it's not because of the issue of the charges against him as serious as they are. It's because Herman Cain has repeatedly lied when confronted about these issues; about not knowing the settlements, not knowing about the payments. Not answering forthrightly.

So Herman Cain has not met that threshold that a presidential candidate has to meet. Do you have the character to serve? That's why he did not get his reputation back and that's why he's not a credible candidate.

PHILLIPS: Will?

CAIN: Well to continue to torture the metaphor, this fight is not over. You're only like round one or round two. So we'll see, we have several other women who suggest they are going to put a -- or would like to put a joint press conference together. We're going to find out a lot more about that issue going forward.

Herman Cain, though, did have a good night. Mainly because of Rick Perry and because of this Penn State scandal. He's not everyone's news today. So he did have a good night but the fight is not over.

PHILLIPS: Patricia?

MURPHY: Yes, well I think that Herman Cain with the exception of the moment where he called Nancy Pelosi, Princess Nancy which I don't think went over that well with a lot of members of the audience. I thought he did himself a lot of favors last night. When he spoke to this issue he went back to his talking points and said this is a media witch-hunt. I am being tried unfairly by the press.

And he got a huge round of ovation among those Republican supporters. That sent a message to anybody watching that the media may have an opinion of Herman Cain but Republican voters have a very different opinion. And they were supporting him in that room last night. I think he at least stabilized his campaign (INAUDIBLE) PHILLIPS: All right, guys. Time for the buzzer beater. Let's get back to Rick Perry. It took him 53 seconds to answer this. You get 20 seconds. What government agency would you eliminate and why?

Will?

CAIN: Department of Education. Now the mouth breathers out there are going to be like, what? He's anti-smart and pro-ignorance? No. I'm not. Over the last 30 years the Department of Education's per student spending has tripled but our test scores have flat lined. Yes, education needs reform but it doesn't have to come from Washington D.C., It can come from your local and state governments.

PHILLIPS: Robert?

ZIMMERMAN: You know that question illustrates the great problem in American public policy. Taking these issues and reducing them to sound bites versus looking to policy.

Now, I'm not going to advocate abolishing departments. Yes, reform, consolidation of services, sure. But every time we try -- every time we abolish a department, that's a victory for the special interests and a defeat for the middle class of America. That's why we need to keep the Environment Protection Agency going, that's why we're going to keep Social Security intact, and keep Medicare functioning.

PHILLIPS: Whoa, OK. Patricia, bring us home.

MURPHY: OK. I have my eyes on a very efficient, very effective, very aggressive agency of the government. I'm ready to get rid of it, it's the Washington, D.C. DMV. They do their job too well. Go away.

PHILLIPS: Boy, she took us in a totally different avenue. You got Will with the straightforward answer. You got Robert who is not a happy guy going after Will and then Patricia just throws us for a loop there.

MURPHY: Well, I feel passionately about this issue, and I'm ready to launch my campaign.

PHILLIPS: You know what I think DMV lines go all the way back to when we were turning 16 guys. That's how bad it's always been. All right. I appreciate it.

MURPHY: Thank you.

PHILLIPS: Well, coming up, Eddie Murphy quits his Oscar's hosting gig. We're going to tell you why you he's walking away from his biggest role in years.

And how would you like to invest in the Green Bay Packers? We'll tell you what the defending Super Bowl champs are planning to do, next.

(COMMERCIAL BREAK) PHILLIPS: Checking stories cross country now:

Jefferson County, Alabama has filed the largest municipal bankruptcy in U.S. history. The county is more than $4 billion in debt and commissioners say it is has become unsustainable. Jefferson County is home to Birmingham, the state's most populous city.

In Connecticut, the Northeast Utilities Company has created a $10 million to help customers who lost power during last month's freak winter storm. At its peak some 830,000 customers were affected. That would work out to about $12 a customer.

And in Wisconsin, the defending Super Bowl champs the Green Bay Packers plan to sell stock to the public next week. It is the team's first stock offering since 1997.

Well, the Oscars have a job opening now that Eddie Murphy has quit his job. A.J. Hammer joining us live from New York. It has been an hour or so since we floated the idea about you and me co- hosting. So have you heard from the Academy yet?

A.J. HAMMER, HLN HOST, "SHOWBIZ TONIGHT": Yes, I got a call from Brian Grazer (ph), Kyra. He just wants you. He doesn't want me to have anything to do with it.

PHILLIPS: Yes, right. All right. Give us the dish.

HAMMER: Yes. Here is the deal. Brett Ratner stepped down from the producer gig for the Oscars after all this backlash over his use of a gay slur. That's something he's apologized for; he's working to make amends for that. So it wasn't really surprising to anyone when Eddie Murphy then decided to not host the Oscars since Ratner handpicked him for the job. They just worked on the film "Tower Heist", which just was released together.

Murphy is publicly saying he completely understands why Ratner is walking away. He wishes the Academy well but he doesn't want to continue without his creative partner, Brett Ratner. And there is some buzz that Murphy's not at all happy about this.

But now the Academy is tasked with finding his replacement. That's going to be chosen by Brian Grazer. Brian was just named as the new producer of the Oscars. A bunch of names being tossed around, Billy Crystal, Tom Hanks, Whoopi Goldberg, Ellen DeGeneres, Steve Martin, Neil Patrick Harris among them. Most of the names on that list have hosted the Oscars in the past.

It would be a first for Oscar winner Tom Hanks. Tom did a terrific job, I thought, hosting the big Oprah finale. Neil Patrick Harris always does a good job hosting the Tonys and the Emmy awards. So I think any name on that list would be a good choice for the Oscars this year -- Kyra.

PHILLIPS: Indeed.

All right. Moving on to Mariah Carey. She apparently got a little catty about Kim Kardashian. What's up with that?

HAMMER: Yes, I think she was just having a good time here. But a lot of people are saying that it felt like a little bit of a dig. Anyway this was some comments that Mariah made after she was just introduced as the news spokesperson for Jenny Craig -- and she looks fantastic, by the way.

Now, she was talking about her marriage. While she didn't name Kim Kardashian by name it is pretty clear who she was talking about. I will let you judge for yourself. Listen to what she said.

(BEGIN VIDEO CLIP)

MARIAH CAREY, SINGER: I'm a real person. I'm not going to put on a fake Hollywood yes, every single time. I'll accept anything. I faint and fall on the floor. No. Sometimes we make each other mad. Sometimes I make him mad.

UNIDENTIFIED FEMALE: That's called a relationship.

CAREY: That's called why we are not divorced after four months, you know what I mean? What?

(END VIDEO CLIP)

HAMMER: She's playing all coy. What? What do you mean? She was just having a little fun there, Kyra. That's why we didn't get divorced after four months. That is Mariah.

PHILLIPS: Way to save it. Thanks, A.J.

If you want all information on everything breaking in the entertainment world A.J. has it, every night. "SHOWBIZ TONIGHT" on HLN, 11:00 p.m. Eastern time.

Joe Paterno is gone as Penn State football coach. How do you follow a legend at Happy Valley? We will tell you who is stepping in next in sports.

(COMMERCIAL BREAK)

The Joe Paterno era is over at Penn State. Tom Bradley is stepping in for the legend. He played for Paterno, coached under him and he's now taking over for his mentor. Big game Saturday at home against Nebraska.

Let's talk more about Penn State football going forward. NPR correspondent Mike Pesca; you know Mike, let's start with the fact that these riots, these protests, that we have been seeing on the air, all the students outside Joe Paterno's home, put that in perspective for those that may just not get it.

MIKE PESCA, NPR SPORTS CORRESPONDENT: Right. For those of us who are removed from what Penn State is and what their football program means to the students and alumni, we see a riot or people expressing a massive amount of support for a man who though he has many merits, in this instance, we can say that he was at best a minimal satisfier in trying to root out sexual child abuse. That's hardly something to take to the streets in support of.

But you have to realize that he is the embodiment of Penn State football and Penn State football stands for things other than longevity and wins which they certainly have. Joe Paterno is dedicated to the grand experiment of football players graduating on time. And he gave to the classics and he was such a throwback, generations were connected, perhaps Penn State student today, his father, or grandfather might have gone to the school while Paterno was coach. He has been there for so long.

So when people express this sort opinion, of course, it strikes at their identity. I think that's a key thing to understand. That the shouts of "We are Penn State" were some of the most common shouts during those riots doesn't excuse especially toppling over a news van. But there was depth of emotion that was going on the campus that night.

PHILLIPS: Ok. So we talked about, you know, ok, Paterno is gone. Obviously Sandusky is gone. But there's still Mike McQueary. I mean this was the young man that came forward and told Paterno about what he saw in the shower. I mean, he could still -- we haven't heard from him. We don't know what's going to happen with him. He could still be on the field coaching and sort of like ok, is this the next shoe to drop?

PESCA: As of now there is no indication that he won't be on the field. He's very tall and he has striking red hair so you will be able to pick him out. He was not a young man when you saw the alleged rape in 2002. He was 28 years old and now he's in his mid to late 30s.

And I think there is -- I think he used the word "disconnect". There are answers or there are questions that people would really like to hear about what Mike McQueary told Joe Paterno and what Joe Paterno in turn told his superiors.

If Joe Paterno does an interview where that question is asked of him and he says something along the lines of well, I was told there was groping or horse play, there's going to be a maw, a chasm that perhaps McQueary could address because from what we know of the grand jury indictment, McQueary was pretty explicit in what we saw and that lack of communication somewhere it broke down in terms of expressing just how serious these actions were.

PHILLIPS: Got to leave it there. We will talk more. NPR's Mike Pesca; Mike, thanks so much.

PESCA: You're welcome.

PHILLIPS: Straight ahead --

(BEGIN VIDEO CLIP)

If you're going to be an actor, you go to L.A. If you are going to be in fashion you go to New York. If you are going to be in technology, then you come to Silicon Valley.

(END VIDEO CLIP)

PHILLIPS: Well, that's the Promised Land for tech start-ups. But minority led firms can have trouble getting a foot in the door in Silicon Valley. Soledad O'Brien looks at some folks trying to change that.

(COMMERCIAL BREAK)

PHILLIPS: All right. Here are some stories on our radar today.

Minutes from now a historic World War I memorial is unveiled on the National Mall in Washington.

Then at 11:30 Eastern First Lady Michelle Obama speaks to business leaders, veterans and their spouses.

And at 1:00 Eastern, NASA holds a media briefing on this month's launch of the Mars science laboratory.

Last year only one percent of Internet start-ups were founded by African-Americans. The NewMe Accelerator hopes to change that. It was created to speed up the development and success of minority-led technology start-ups. Our Soledad O'Brien explains.

(BEGIN VIDEOTAPE)

SOLEDAD O'BRIEN, CNN SPECIAL CORRESPONDENT (voice-over): In this unassuming three bedroom home in Mountain View, California, Angela Benton and Wayne Sutton hope to make history.

WAYNE SUTTON, CO-FOUNDER, NEWME ACCELERATOR: Yes, see what this thing look like.

ANGELA BENTON, CO-FOUNDER, NEWME ACCELERATOR: One of them is supposed to be a sofa bed.

O'BRIEN: The friends connected online. Two black Internet entrepreneurs trying to succeed in an overwhelmingly white industry.

BENTON: For whatever reason, African-Americans tend to be consumers of technology and not really creators of technology.

SUTTON: Name me one black Web tech founder or start-up CEO? Where's an example of a black Mark Zuckerberg?

O'BRIEN: Last year only one percent of Internet start ups that will see funding were founded by African-Americans. So, Angela and Wayne created the New Media Accelerator, "NewMe" for short. A groundbreaking program designed to speed up the development and success of minority-led start ups in Silicon Valley.

BENTON: If you're going to be an actor, you go to L.A. If you're going to be in fashion, you go to New York. And if you're going to be in technology, then you come to Silicon Valley. O'BRIEN: Modeled after similar programs, New Me offers its dotcom founders immediate access to deep-pocketed investors, well- connected mentors and opens doors at some of the most successful Internet companies in the world.

UNIDENTIFIED MALE: Welcome to Facebook.

O'BRIEN: The downside --

BENTON: Everyone will be living together.

O'BRIEN: Eight people, nine weeks, one house, one goal. Changing the face of Silicon Valley.

BENTON: For it to be successful to me, founders have to get investment.

UNIDENTIFIED MALE: Thanks for your enthusiasm for coming to Google.

O'BRIEN: The high-stakes program backed by sponsors culminates in demo day when each entrepreneur will have just six minutes to pitch their company to a room full of investors.

For "In America", Soledad O'Brien, CNN, Silicon Valley.

(END VIDEOTAPE)

PHILLIPS: You can see more of Soledad's special Sunday night at 8:00 Eastern.

(COMMERCIAL BREAK)

PHILLIPS: Going into last night's debate the bull's eye appeared to be right there on Herman Cain and sexual harassment accusations that are pretty much dogging his campaign still.

Senior political editor, Mark Preston, Washington; so Mark, what do you think? How did Cain handle the topic last night?

MARK PRESTON, CNN SENIOR POLITICAL EDITOR: Well, you know, Kyra, there's no question about it. Herman Cain can't seem to get away from these accusations of sexual harassment. He was asked the question last night during the debate. Of course, Herman Cain wants to talk about his policies. But of course, this is the question on everyone's mind. Let's hear what he had to say.

(BEGIN VIDEO CLIP)

HERMAN CAIN (R), PRESIDENTIAL CANDIDATE: I value my character and my integrity more than anything else. And for every one person that comes forward with a false accusation, there are probably -- there are thousands who would say none of that sort of activity ever came from Herman Cain.

(END VIDEO CLIP) PRESTON: Now, Kyra, there you have Herman Cain addressing the question head-on. A couple of things. First of all, when that question was asked, the audience booed the moderator so Cain still has some support within the Republican Party. In fact, we have seen some early state polls that show that Herman Cain continues to do well.

But the question remains, can he weather this really big political storm if more women come out and accuse him of sexual harassment. That's a question, Kyra, we just don't know right now.

PHILLIPS: All right. Mark Preston. Thanks so much. We are going to get the next political update in just an hour. And a reminder, for all the latest political news, just go to our Web site, cnnpolitics.com.

That does it for our whirlwind of the two hours. Now, you can continue that with Suzanne Malveaux.

SUZANNE MALVEAUX, CNN ANCHOR: Good to see you Kyra.

PHILLIPS: Good to see you too.