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Payback Politics in Spotlight; Unanswered Questions Remain on Christie, Bridgegate; Jobs Report Short of Expectations; Jobless Benefits Hit Snag in Senate; Target Data Breach Bigger Than Thought; How Cigarette Advertising Has Changed

Aired January 10, 2014 - 13:30   ET

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

PETER HAMBY, CNN POLITICAL DIRECTOR: But, you know, looking ahead for Christie's political prospects, this environmental stuff raises questions about, you know, the kind of culture he allows to exist around him. When he took over the Republican governor's association, which he did recently, the back story there is that he kind of stepped in and muscled Bobby Jindal, Louisiana governor, out of the way, which kind of took a lot of people in RGA circles back, because there is sort of a decorum people abide by and Christie just barged in and said I want to run the RGA and did it.

BRIANNA KEILAR, CNN ANCHOR: His middle name is not decorum. I think we can say that about Chris Christie for sure. One of his vulnerabilities, of course, there are conservative Republicans suspicious of him. But one of his strengths as a political candidate, he is a Republican in a blue state. So if he were, let's say, by all of this, to be forced out of the race, if he were no longer viable, when you're looking towards 2016, who do Republicans have who could -- could help in those blue states and perhaps kind of turn them red?

HAMBY: Right. So if you're looking at that, you kind of have to look at this traditional divide of the Republican Party. You have your kind of grass roots wing on the right. And sort of your more establishment wing on the left. There is a different sort of ideological tangents going on here, some libertarians and whatever. Looking to people who could appeal to moderates, Jeb Bush, a lot of people, you know, we talked to don't think he's going to run. But he's still very tight with the donor class and Wall Street and those sorts of things. Scott walker, Wisconsin governor, most Americans have no idea who he is, but political insiders think he's someone who could appeal to your sort of blue collar voters, your hockey moms, in places like New Jersey, Wisconsin, Iowa. So those are two names I think come up a lot.

KEILAR: And we'll be watching as this develops, as we know it will.

Peter Hamby, thank you.

HAMBY: Thanks.

KEILAR: There's a lot of unanswered questions about the bridge scandal and its impact on Governor Christie and the 2016 presidential race. Joining us now, from Miami, CNN political commentator and Democratic strategist, Maria Cardona; and from Dallas, CNN political commentator, Ben Ferguson.

So, Christie is adamantly denying he knew anything about this plot to block traffic in Fort Lee, New Jersey.

I'm going to ask you this first, Ben.

How could such a hands-on guy not know what key staff members are doing? And if he didn't know, what does that say about how his staff does business?

BEN FERGUSON, CNN POLITICAL COMMENTATOR: Well, his staff members didn't want him to know they were doing this because it was a stupid move and a prank by some narcissistic staff members that have no power without them being close to the governor. And he runs a massive state. He is not going to be checking his staff's e-mails like they're his children. He trusted him for years. They did something stupid. He asked everybody if they were involved. They told him no. And as soon as he found out they lied to him, he did the responsible thing and fired them. Chris Christie is not an idiot. He's not willing to risk his entire political career over traffic, is the main thing that I think is almost laughable over this. And the other thing is, he's a lawmaker, who also understands investigations because of his last job. If he lied yesterday, he knows he's going to get busted for it. That's why he had the long press conference, that's why he made it clear he wasn't involved, because he knows he wasn't involved. I believe him on this one. And I think it will come out in the end he was telling the truth.

KEILAR: What do you think, Maria? Do you think it's enough what he did yesterday, and do you think that's the truth that he was just sort of ignorant?

MARIA CARDONA, CNN POLITICAL COMMENTATOR: Well, it's certainly not enough, Brianna. This, I think, opens the door for many additional questions that were not answered in yesterday's press conference. And it goes to what you mentioned about the culture of the kind of staff that he put together. Look, I have worked for many principles in my political career. And there's no question that the closest advisers to a principle absolutely reflect that principle's values. And so for somebody like the deputy chief of staff and others who are close to him, who he has now fired, to have done this, gone down this road, they have had -- they have had to think, at some point, this is something that the governor will support, this is something that the governor wants, or else they wouldn't have done it. And, yes, I think it was stupid.

(LAUGHTER)

But I think it indicates a culture and an aura that frankly has set a tone, if you will, that is set at the top. And that's very problematic for the governor.

(CROSSTALK) KEILAR: And, Ben, to that appointment, he fired his right-hand man, Bill Stepian. I mean --

FERGUSON: And he did it --

(CROSSTALK)

KEILAR: There is this sense --

(CROSSTALK)

FERGUSON: I go back to look at what he's doing. Democrats don't care about the truth. They're trying to destroy Chris Christie. Let's be very honest about this.

KEILAR: Sure. And he's a front runner.

FERGUSON: Right. And they don't care.

KEILAR: But let me ask you this. Ben, let me ask you this. Because I hear your point there, and certainly, if he's directly involved with it, it's not the same as if he created a culture, even though that's bad. Let me ask you about this, though. There's legal grounds for this. You can't just be sort of, you know, willfully ignorant. In fact, it's called what I think -- willful blindness, where this could actually be a problem for Christie.

FERGUSON: You're inclined. But here's the thing. He wasn't willfully looking the other way. You could tell by his actions. Look at this politically. Does Chris Christie want to lose his right-hand man, as important as everyone is now making out that these people around him were? Obviously, it would be bad for his future to get rid of people he trusts close to him, unless they betrayed his trust. So if you look at his actions, he got rid of people he trusted. That's not good for him long-term, politically. The traffic wasn't good for him. That's why I don't believe he knew about it. He had two bad apples, fired those bad apples. He's going to have to replace people he doesn't know, as well. That's not good for him politically. He didn't want any of this around him. He fired them. That's what --

(CROSSTALK)

KEILAR: Maria, what do you say about that? You're talking about he did get rid of a guy who some people said, if Chris Christie ran for president, and this is the guy who would manage his campaign, that is a big move.

CARDONA: No question about that, Brianna. But he had no choice. At this moment, he had to do that, or it certainly would be the end a lot quicker than what he would want.

(LAUGHTER)

But here's the problem. His other very close friend, David Willstein, I believe is his name, pleaded the Fifth yesterday when he was being questioned about this. So it might very well be that he did that because he didn't want to incriminate himself. But pleading the Fifth, and somebody who was very close to the governor, also raises a lot of questions.

Ben may be absolutely right. The governor may have had absolutely nothing to do with this. But then it goes to the question of how competent is he, and how credible is he when he says the buck stops here. And --

(CROSSTALK)

FERGUSON: Maria, I wish --

CARDONA: -- fair for him to paint himself as the victim, which is what he did yesterday, as opposed to really finding out what happened there.

FERGUSON: Maria, I wish you would have asked these same questions about the president of the United States of America on Benghazi, on the IRS scandal, on Fast and Furious, on healthcare.gov, on all of those issues, Susan Rice walking out and knowingly putting a lie out there on that issue --

(CROSSTALK)

CARDONA: They have been asking --

(CROSSTALK)

FERGUSON: No, they haven't.

CARDONA: Yes, of course, they have!

(CROSSTALK)

KEILAR: -- a number of e-mails, and I've -- obviously, Ben, some questions do still persist. And continue to be some hearings, as well on things like Obamacare. But I think this -- we're going to continue to see a lot of these questions that we're discussing right now on this story --

(CROSSTALK)

CARDONA: -- such a different situation.

FERGUSON: Let me say this.

(CROSSTALK)

FERGUSON: Let me say this.

(CROSSTALK)

FERGUSON: There is no doubt in my mind -- I want to make this very clear -- that Chris Christie's career is not even close to over if he was telling the truth yesterday, which I totally believe he was. He is going to be just fine in the long-term from this. This is not a career-ender when people around you do something stupid and you fire them. That's being responsible, what we should want from politicians, and he did just that.

KEILAR: And that is if --

(CROSSTALK)

CARDONA: I agree --

(CROSSTALK)

KEILAR: Maria Cardona.

CARDONA: That's it. It's possible he comes back.

KEILAR: Oh, it's so nice to end on a note where they agree. We love that.

(CROSSTALK)

(LAUGHTER)

KEILAR: Maria Cardona, Ben Ferguson, thanks so much, you guys.

FERGUSON: Thanks for having us.

CARDONA: Thanks, Brianna.

KEILAR: Job growth last month was not what analysts expected, not even close. We'll look at the numbers and why they fell so short, coming up.

(COMMERCIAL BREAK)

KEILAR: Wall Street just isn't quite sure how to react to this morning's jobs report that fell way short of expectations. Investors trying to gauge how the numbers will affect the Fed's decision to pull back on the stimulus program. The Dow up earlier in the day, but you see right there now, it's down about 29 points.

We have more on that jobs report. When we say disappointing, we do mean disappointing. December saw the weakest job growth since January of 2011.

Here's Christine Romans.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Brianna, hopes dashed for a very strong end of the year for the jobs market. We now know in December, only 74,000 net new jobs created, a big disappointment. Economists all week raising their expectations to close to 200,000 jobs. 74,000, big disappointment. It shows weakness in the labor market at the end of the year. The Labor Department, in part, blaming cold weather. Then you look at this number, the unemployment rate. This is the lowest in years. On paper, this should be a good number, 6.7 percent. Here's the big caveat, the asterisk, they stopped looking, simply stopped looking. Hundreds of thousands of people stopped looking. Who were getting jobs? High school graduates with no college education. Who were quitting the labor market? College graduates. That doesn't speak well for what kind of jobs we're creating.

Quickly on the trend here, as you know, the trend is so important. In November, 241,000 jobs created. That's a solid number. And then boom, December, a real slow down. The big question for this year, looking forward, will we regain some of that momentum? Was this somehow a weather-related event and you start to pick up that hiring in January? And do you get the momentum back behind the labor market as we go forward? That's a huge, key question for markets, people unemployed, and, frankly, for policy -- Brianna?

KEILAR: Christine Romans, thank you so much.

And jobs and joblessness, a big issue in Washington. A plan to extend long-term jobless benefits hitting a snag. The resistance now coming from the same Senate Republicans who gave Democrats the votes to begin debate on this very bill in the first place.

Dana Bash with me now.

This is pretty complicated, Dana. What happened and why aren't they on board?

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: The bottom line is that the Republicans are -- six Republicans we're talking about -- helped Democrats earlier this week get this bill on the floor in the first place. Democrats were surprised that even happened. So the issue is that most of those Democrats are unhappy with a deal we thought maybe would see fruition yesterday. But they're unhappy with it for two reasons. One is the substance of it. They don't think that the way that Democrats are proposing paying for about $18 billion of worth of extending these long-term unemployment benefits, that it's really -- that it's the right thing to do. But probably more importantly, they're upset with the process. Some of these Republicans, Dan Coats of Indiana, Susan Collins and others, I saw them in the hallway yesterday, asking what do you think of this deal in the works. And they said we don't know anything about it. They feel iced out and they feel that they wanted the ability to offer amendments, which sounds like maybe it's not that important. But it is. And has become much more of an issue for Republicans who are in the minority who feel like they don't have a chance to do that often enough. That's why things are sort of a bit of a mess right now. But the Republicans who want to get this done, they insist are going to work on it through the weekend and hope they might have some kind of deal by Monday.

KEILAR: Because some of these Republicans said, we do want to debate this, but we kind of want to put our stamp on it. We want to make some of our changes. And now they don't feel like they have their input there.

You're hearing from a lot of Republicans that are accusing Democrats, they're accusing the White House of kind of not really actually -- this is pretty cynical stuff. Not wanting this to succeed, so that they can kind of have this issue to kind of knock Republicans around in this important midterm election.

BASH: Absolutely. I talked to so many Senate Republicans coming off the Senate floor yesterday after it was kind of nasty on the Senate floor about this, saying that very thing, saying we just think Harry Reid, Senate majority leader -- it's to have an issue. And it's clear the way he is handling this. They feel iced out.

However, I talked to some Democrats today, who said, look, from a cynical, political point of view, they insist that it's better for them to have this as something that actually passes. Why? In fact, we have some statistics that came out today that maybe help illustrate this. Of the people who still don't have jobs, many of them, 37.7 percent, are those long-term unemployed. And those are the people who would benefit from this unemployment extension that we're talking about. So what these Democrats say is they believe, politically and substantively, that it is much better, much more of an economic stimulus to get them this money, to extend these unemployment benefits. They insist that will create jobs and that is even, if you look at this in a callous, political way, they insist that is the best political tact for them to take.

KEILAR: All right. Dana Bash, thank you so much.

BASH: Thank you.

KEILAR: Now Target now says that that data breach that compromised the personal information of its customers affected a lot more people than first reported. In fact, tens of millions more. We'll have details, ahead.

(COMMERCIAL BREAK)

KEILAR: You know that data breach at Target was pretty big to begin with. Originally it was reported that 40 million customers had personal information stolen in the weeks following Thanksgiving. Well now, the company says that number is actually 70 million.

Alison Kosik joining us from New York.

Alison, that's a pretty big revision, right?

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Yeah, it's a very big revision, Brianna. Target is saying this is a new security breach, but new information that it's discovered as this investigation continues, that 70 million customers were affected instead of 40 million. Even worse, on top of the credit and debit card numbers and pin numbers stolen, Target said this type of sensitive information was stolen, names and mailing addresses and e-mail addresses and phone numbers. What consumer experts are saying at this point is what this extra information does is it gives more options if they are going to try to access money. Watch out for the e-mail scams. If someone is watching for information or impersonating Target, don't give them information. The fact that they got more information than first thought is stunning, because this really sort of leaves the Target shoppers really open season on their credit history. KEILAR: I thought, Alison, that at first, it was as if they got the numbers and the pin data. That was encrypted and that's not going to be a problem. That's what it was before we found about the personal information?

KOSIK: Right. They stole the debit card numbers and the pin numbers, but those were encrypted. They said don't worry about that because they won't be able to reach into your bank account that way to maybe steal your identity.

KEILAR: For Target, this must be bad news. Are we seeing that this is having an effect on Target's business?

KOSIK: As part of this release of new information, Target spelled out what the fourth-quarter earnings are going to look like at the end of February. Target wound up lowering the expectations. It says the sales took a hit after it made this announcement. It does say its sales have improved a bit, but people are not shopping there as much despite the fact that Target has identified and fixed the vulnerability. Consumer confidence is huge for retailers. Not only will consumers spend more if they feel good about the economy and their own financial situation, but they need confidence in where they're shopping, who they are handing over their plastic to -- Brianna?

KEILAR: Sure they do. That's so important.

Alison Kosik, thanks for the update.

KOSIK: Sure.

KEILAR: We all know that the health problems that cigarette smoking can cause, but there were days when smoking was seen as glamorous and good for you. We will have a special report on what caused cigarettes to lose their star power, straight ahead.

(COMMERCIAL BREAK)

KEILAR: Some ex-NBA players, in North Korea for the exhibition basketball game, have left the country and are in Beijing today. One of the players, Charles Smith, talked to reporters about what he thinks they accomplished on the controversial trip.

(BEGIN VIDEO CLIP)

CHARLES SMITH, FORMER NBA BASKETBALL PLAYER: We all sat out to use basketball as a great cultural exchange. We accomplished that mission. All the players there and the American tourists, even our documentary film crew, I think we all agree that the trip was just simply incredible. I had an opportunity to meet with the leadership, so I will do a live interview at some point soon to discuss the culture and some of their economic strategies. We talked about quite a few things, even some of the concerns. I will do that in a live interview. But the trip was great.

(END VIDEO CLIP) KEILAR: Dennis Rodman, who led the delegation, stayed behind for what is his fourth trip in less than a year.

High alert in Russia as the nation prepares to host the world for the Winter Olympics. Even as security is stepped up in the resort town of Sochi, the FBI is sending dozens of agents to help protect athletes. There have been three suicide bombings since October and Islamic extremists have vowed to disrupt the games. In the latest incident, six bodies were found in four cars, some of them rigged to explode bombs. The games are set to start on February 7th.

We have come a long way since the days when doctors and celebrities promoted cigarettes. 50 years ago tomorrow, the surgeon general warned that smoking is linked to lung cancer.

Our Dr. Sanjay Gupta looks at how cigarette advertising has changed since then.

(BEGIN VIDEOTAPE)

(BEGIN VIDEO CLIP)

ANNOUNCER: Make your own 30-day Camel mildest test in your key zone.

(END VIDEO CLIP)

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT (voice-over): During the hay day in the 1940s and 50s, ads like this were common place.

(BEGIN VIDEO CLIP)

ANNOUNCER: What cigarette do you smoke, Doctor?

In this nationwide survey of general practitioners, surgeons, throat specialists, diagnosticians and so on, the brand named most was Camel.

(END VIDEO CLIP)

GUPTA: By 1950, American adults were smoking 4,000 cigarettes for every person every year.

But in 1952, "Reader's Digest," then the most popular magazine, published a two-page article, "Cancer by the Carton." It was the first time a mainstream publication like this connected smoking to cancer.

In 1955, the Federal Trade Commission forbade companies from making health claims about cigarettes, blocking ads like this from Phillip Morris, "Scientifically proved, less irritating to the smoker's nose and throat."

JON HAMM, ACTOR: The Federal Trade Commission and "Reader's Digest" have done you a favor.

GUPTA: It's a moment that helped to launched fictional ad wiz, Don Draper, on AMC's "Mad Men."

HAMM: We can say anything we want. How do you make your cigarettes?

UNIDENTIFIED ACTOR: We bred insect repellant and tobacco seeds, plant them in the North Carolina sunshine, grow it, plant it, cure it, toast it.

HAMM: There you go. There you go.

UNIDENTIFIED ACTOR: But everybody else's tobacco is toasted.

HAMM: No. Everybody else's tobacco is poisonous. Lucky Strikes is toasted.

GUPTA: In fact, that was an actual Lucky Strikes slogan in real life.

But evidence of harm became overwhelming. On January 11th, 1964, Dr. Luther Terry issued the very first surgeon general's report.

(BEGIN VIDEO CLIP)

DR. LUTHER TERRY, FORMER SURGEON GENERAL: The strongest relationship between cigarette smoking and health was in the field of lung cancer.

(END VIDEO CLIP)

GUPTA: A strong relationship. How strong? He reported a 70 percent increase in mortality for smokers. Heavy smokers at least 20 times more likely to develop lung cancer than nonsmokers.

The first warning on the pack in 1966 was a milestone, but also a major understatement. "Cigarette smoking may be hazardous to your health." Today, it gets right to the point, it causes lung cancer, heart disease, and more.

Dr. Sanjay Gupta, CNN, reporting.

(END VIDEOTAPE)

KEILAR: That's it for me. NEWSROOM continues right now with my pal, Brooke Baldwin.

BROOKE BALDWIN, CNN ANCHOR: Brianna Keilar, thank you so much.