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CNN Tonight

Executive Salary Cap; Banker Bonus Outrage; Loophole Makes Sick Pay; Americans Arrested in Pakistan; Population and the Environment; Winter Storms

Aired December 11, 2009 - 19:00   ET



ERICA HILL, CNN ANCHOR (voice-over): Tonight Wall Street whacked by the pay czar. Firms that took billions in taxpayer money hit with new pay limits. Execs cut back to a max of half a million dollars.

UNIDENTIFIED MALE: We're trying to reign in compensation practices.

UNIDENTIFIED FEMALE: We are sending a clear message to Wall Street. The party is over.

HILL: But will Wall Street get the message?

Five Americans busted in Pakistan. Police now say the men wanted to wage holy war against U.S. troops in Afghanistan.

UNIDENTIFIED MALE: They were there for jihad. They would have done anything.

HILL: Just how big is the threat of homegrown terror?

And the war on drugs across the border -- Juarez, Mexico, now ground zero, a city where a day without murders is news.

UNIDENTIFIED MALE: There can be no more pertinent reminder of the Mexican blood that's being spilt in this war for the right to supply America's demand for elicit drugs.

HILL: Can anything stop the drugs or the blood from spilling over the border?


ANNOUNCER: This is CNN TONIGHT live from New York. Here now Erica Hill.

HILL: Good evening everyone and thanks for being with us. New rules and likely plenty of grumbling on executive pay -- the Obama administration cracking down even further on compensation at companies that took billions in taxpayer money -- White House pay czar Kenneth Feinberg imposing those new regulations today. Some mid level execs will now max out at half a million dollars and they'll have to take almost half of that in company stock. As Ed Henry reports, the new caps have bailed out firms racing to pay back all that bailout cash.


ED HENRY, CNN WHITE HOUSE CORRESPONDENT (voice-over): While the president is only turning up the heat on four companies that got the biggest taxpayer bailouts, he's trying to send a message to corporate boards all across America.

KENNETH FEINBERG, SPECIAL MASTER, TARP EXEC. COMPENSATION: We have to reign in excessive compensation practices and tie compensation not to some guaranteed cash but to long-term performance so that as the company thrives, the individual in the company thrives as well.

HENRY: The new restrictions impact the 26 through 100 top earners at AIG, Citigroup, General Motors and GMAC. Their cash salaries are now limited to $500,000 a year. And cash can only make up 45 percent of the total pay package. But there could be a loophole because there's no cap on super sized bonuses.

UNIDENTIFIED MALE: It really isn't the role of the federal government to determine how much of a bonus within that pool that person should get or that person should get. We're not micromanaging.

HENRY: But the new restrictions seem to micromanage in other ways. In addition to the cash salary cap, bonuses cannot be redeemed for three years and must come from a pool of money based on long-term performance. A contradiction we pressed pay czar Kenneth Feinberg about.

(on camera): But you are micromanaging it appears their salary. You are saying a cap.

UNIDENTIFIED MALE: Well what we're doing is saying this. First, in the great majority of cases, with all due respect, a $500,000 maximum base cash salary is more than reasonable as a limitation. Secondly, if there is an exceptional case where additional amounts should be allocated in base salary, we will review that.

HENRY: Feinberg said he's encouraged by Goldman Sachs' voluntary decision to skip cash bonuses, but he understands the anger about others raking in big bucks during 10 percent unemployment.

UNIDENTIFIED MALE: I'm doing what I can do under the law to try and right -- somewhat right that balance and hopefully we'll see some long-term impact on excessive Wall Street compensation.


HENRY: And Erica, as you noted Bank of America sent the federal government billions of dollars this week so that they would not have to follow these pay restrictions and I can tell you the White House is planning to keep the heat on some of these bailed out firms. On Monday the president is calling the CEOs of a dozen big banks here to the White House for a meeting. We're told by White House aides he's going to press some of these banks to start lending more money to small businesses, consumers, homeowners, who are under water in their homes right now. They realize here at the White House that at a time when a lot of people on Main Street are hurting it doesn't look very good when Wall Street is starting to collect these fat paychecks once again -- Erica.

HILL: Yes, not so much. It would be good to be a fly on the wall in that meeting, (INAUDIBLE) Ed.

HENRY: Oh yes.

HILL: Ed Henry live for us tonight at the White House.

Despite the new crackdown, plenty on Wall Street are actually seeing their mega bonuses come back. Ed alluded to that a little bit. President Obama saying the practice has him, quote, "irked" and he's not alone. Lisa Sylvester tonight on why some way Wall Street just doesn't get it.


LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Many in America are seeing pink slips or shrinking paychecks, but one place where big cash payouts are expected, Wall Street. Top executives are expected to rake in millions in year-end bonuses. It's not playing very well on Main Street.

JENNIFER CALCANO: It's not fair at all, you know. Everyone is struggling. People are struggling to keep their jobs. It's hard right about now. I don't think it's fair that they're getting bonuses.

LINCOLN SLONE: I don't know about right now with the economy and everything. I think everybody should take a little cut in the bonus area for the good of the economy right now.

SYLVESTER: Goldman Sachs has set aside $21 billion this year for bonuses to its 32,000 employees, about the same as in 2007. At the height of the recession the federal government came to the company's aid with a $10 billion loan. The company paid back the loan with interest removing restrictions on the money paid top executives.

But Goldman Sachs announced instead of cash its most senior executives would be paid with stock and their shareholders will have a say on pay although their input is nonbinding. Also, White House pay czar Kenneth Feinberg has announced new limits on the amount of compensation for top company employees at the firms that received the largest bailouts. Citigroup, AIG, General Motors and financing group GMAC, but AIG's chef executive says he's frustrated with the government's ruling. Banking experts say compensation limits could make it harder to retain the best and brightest employees.

ROSE MARIE ORENS, COMPENSATION ADVISORY PARTNERS: There's a lot more capital out there now. There really is and that capital is looking to take talent out of these banks and have them start up hedge funds or start up particular investment activities.

SYLVESTER: But it's kind of hard for the average Joe to accept Wall Street rewarding its managers who they believe caused or at least share in the blame for the financial debacle.

JACK COFFEY, COLUMBIA UNIVERSITY: If the company prospers, the executives receive extraordinary income and if the company fails, taxpayers bail them out and they still want high income. And it's that kind of "heads I win, tails we break even" gamble that the public will no longer accept.


SYLVESTER: Congress is moving ahead on legislation to prevent another financial crisis. The financial regulatory reform bill calls for more oversight and higher cash on hand for banks. It also sets up an emergency bailout fund that Wall Street would have to pay into, so if Wall Street gets in trouble again theoretically it's not going to be the taxpayers on the hook.

HILL: Theoretically (INAUDIBLE). Lisa thanks.

Tucked away in the more than 2,000-page Senate health care bill a clause that allows insurance companies to limit your annual benefits is a loophole that has patient writes advocates crying foul and warning those battling diseases like cancer may actually have to choose between their own treatment and financial ruin. Brianna Keilar has more.


SEN. CHRISTOPHER DODD (D), CONNECTICUT: If you're a citizen of the United States and you get sick you ought not to be shoved into bankruptcy.

BRIANNA KEILAR, CNN CORRESPONDENT (voice-over): It's a frequent call of top Democrats as they push to overhaul the nation's health care system. One of the ways they have said they would protect Americans was by stopping an insurance company practice of limiting a patient's insurance coverage both over a lifetime and annually. In November the House passed a bill that would do just that, but in the bill now up for debate on the Senate floor under the section that plainly states "no lifetime or annual limits" it says insurance companies may not establish unreasonable annual limits. That one word unreasonable opens up a loophole for insurance companies to cap annual benefits.

(on camera): What does unreasonable mean?

UNIDENTIFIED MALE: We have no idea and that is part of the problem.

KEILAR (voice-over): The American Cancer Society's cancer action network is up in arms about the change. Worried it will cost patients.

STEPHEN FINAN, AMERICAN CANCER SOCIETY: A stage three colon cancer case can cost over $200,000. That's obviously a lot of money. What happens if the annual limits is $100,000?

KEILAR: We asked Senator Tom Harkin, the chairman of the Senate Health Committee.

(on camera): I mean what is this going to mean for say the colon cancer patient whose bills top $200,000 a year?

SEN. TOM HARKIN (D), IOWA: Well again, one of the compromises we had to make -- we do have no lifetime caps and we put in there no unreasonable annual caps.

KEILAR: But what does that mean?

HARKIN: Well that's to be developed by the secretary of Health and Human Services.


KEILAR: Now Democrats have said they made this compromise to keep down the cost of premiums for all Americans but just moments ago I spoke with a representative for the Cancer Action Network and they say there's been a big change. They have been discussing in the last few hours with White House -- top White House officials, top congressional officials who have assured them that those lifetime caps on coverage will be abolished under the Senate bill just as it was -- as it is under the health bill.

And that those lifetime caps actually even under the House bill don't go into effect until 2013. This representative from the Cancer Action Network, Erica, telling me that White House and congressional officials have told them those caps will be set at a minimum to protect someone who maybe has cancer or another life threatening illness that can get very expensive, so this is a very big change.

HILL: So just to clarify, so rather than a cap or a maximum now they are talking about a minimum?

KEILAR: So basically when they would set -- that's exactly right. So they would set it high enough, the cap on coverage high enough that it wouldn't force a cancer patient or some other patient with an expensive and life threatening illness to have to pay for their expenses out-of-pocket or perhaps forego that treatment because it's too expensive.

HILL: Interesting development tonight -- Brianna Keilar, thanks.

We're going to continue to look at health care in the fate of the so-called public option. We'll also delve a little bit deeper into these changes we just heard about -- breaking news from Brianna. That's coming up a little bit later in the show.

Meantime, Americans busted in Pakistan, reportedly plotting to wage Jihad overseas. So just how real is the threat of homegrown terror and a violent drug war waging just a stone's throw from the United States. We'll take you to the streets of Juarez, Mexico. It is the murder capital of the world. The bloodshed there though could be spreading north of the border.

(COMMERCIAL BREAK) HILL: New developments tonight in the arrest of five American students in Pakistan, Pakistani police now reporting the young men were planning to wage Jihad in Afghanistan. Now for security reasons those men we're told will soon be transferred to a jail in Lahore, Pakistan. Eventually they will be deported to the U.S. according to authorities. International correspondent Arwa Damon has the very latest.


ARWA DAMON, CNN INTERNATIONAL CORRESPONDENT: Hi, Erica. There's more information emerging today about the trail that brought these men to Pakistan and about their final destination. For details we spoke to Pakistan's minister of interior.


DAMON (voice-over): These are the young men now at the focus of an investigation spanning two continents. They vanished from the United States at the end of last month. Interior Minister Rehman Malik (ph) says authorities were quickly on their trail.

UNIDENTIFIED MALE: Well in fact, we have a very good cooperation with the FBI, I received a communication (INAUDIBLE) of five individuals who had already left the U.S. and that was a good clue.

DAMON: Pakistani authorities say they tracked the men to the city of Sarghoda.

REHMAN MALIK, INTERIOR MINISTER OF PAKISTAN: (INAUDIBLE) investigation they had gone to one of the organization which is in fact on the watch list (INAUDIBLE) and probably they said we don't want you because we always deal or we take people only with references.

DAMON: Each day police say they're putting more pieces of this bewildering puzzle together. The interrogation report released by the police questioning them in Sarghoda says they were headed to Pakistan's tribal areas and then onto Afghanistan. None has yet been formally charged and the mother of one of the men told us he came to Pakistan to get married. Police have their own theory that they came to wage Jihad. And as the interior minister acknowledges, some parts of Pakistan provide assessable ground for those seeking a path to terror.

UNIDENTIFIED MALE: Let's not forget al Qaeda had been operating for years and years (INAUDIBLE) Pakistan and Afghanistan. (INAUDIBLE) speaking if you see all of these (INAUDIBLE) terrorists who were brought in (INAUDIBLE) and Afghanistan, they are all those remnants, so they have been living or their father had been staying here. Some way or the other there had been a connection with that war.

DAMON (on camera): Erica, what really worries the Pakistanis is this influx of young men from overseas that has increased in recent years, coming here seeking jihad and this as Pakistan is still trying to deal with its own homegrown militants. (END VIDEOTAPE)

HILL: Arwa Damon reporting for us tonight. Now U.S. officials tell CNN that has been no decision tonight on whether the U.S. will charge the Americans citing complicating factors in the investigation. One official said quote, "the Pakistanis picked them up before it was clear what they were doing."

Meantime, leaders at the mosque where the five young men worshipped here in the U.S. are simply baffled by the arrest. At a press conference today leaders from the Islamic Circle of North America in Alexandria, Virginia insisted their congregation is committed to peace, moderation and to tolerance.

Still ahead, there are new details tonight in the Tiger Woods saga -- the golfer speaking out about his future in the sport. Also ahead, forget the hybrid cars and the recycling. Why controlling the population may actually be the most effective way to save the planet.

And frigid temperatures sweeping across much of the nation -- I probably don't need to tell you that tonight. Meteorologist Chad Myers will be here to tell all of us what we can expect for the weekend.


HILL: There is a growing movement within both the scientific and environmental communities that believes the biggest threat to the environment isn't cars, isn't power plants, it's people, specifically over-population. At the climate change conference in Copenhagen this week, China said its population efforts are actually helping to slow down climate change, but as Casey Wian reports getting people to even talk about that idea has its own set of complications.


CASEY WIAN, CNN CORRESPONDENT (voice-over): The cheapest way to stop global climate change is not converting to solar power or buying a hybrid car. It's putting on a condom. That's the conclusion of a London School of Economic Study showing that money spent on contraception is about five times more efficient than money spent on clean energy technologies. It backs up a recent Oregon State University study that concludes overpopulation is the single biggest threat to the environment.

PROF. PAUL MURTAUGH, OREGON STATE UNIVERSITY: It's been a lot of attention to the effects of individuals, lifestyle choices and things like transportation, food choices and so on, but relatively little attention to the effect of having children.

WIAN: The "British Medical Journal" and "Lancet" both published an editorial stating that the sensitive issue of population stabilization continues to slip off the agenda but is crucial to achieving real reductions in global CO2 emissions.

VICKY MARKHAM, DIR., CENTER FOR ENVIRONMENT AND POPULATION: There is a large body of scientific evidence that is showing that there are many links between population factors and climate change as well as many other environmental issues but climate change especially.

WIAN: Supporters of the idea are not advocating laws that would restrict individual family planning choices or encourage government funding of birth control. They do want both developed and developing nations to at least discuss the issue. Rapidly rising population is a greater threat in third world nations while the environmental impact of each child in developed countries is greater because they use much more energy.

PROF. BEN ZUCKERMAN, UCLA: People should be made aware of both by the environmental organizations and by the media that it's good for a couple to stop at two or fewer non-adopted children and -- and then to outline some of the good environmental things that would accrue.

WIAN: Yet many environmental groups are reluctant to tackle the issue, so is the United Nations which is overseeing climate change negotiations -- one barrier, cultural sensitivities. "The Washington Post" reports it asked a U.N. official about family planning and the environment and the official replied that quote, "to bring the issue up would be an insult to developing countries."

(on camera): With U.S. officials ranging from California Governor Arnold Schwarzenegger to President Obama heading to Copenhagen for the Global Climate Summit, scholars who are concerned about the impact of population on the environment are hoping to make their voices heard as well.

Casey Wian, CNN, Sacramento, California.


HILL: Snow, frigid temperatures and high winds are hammering the Great Lakes region, all part of the deadly storm that dumped more than a foot of snow over much of that region. And frankly the forecast for some of the rest of the country is not a lot warmer this weekend. Chad Myers joining us now from CNN's Weather Center -- plenty chilly here in New York, Chad.

CHAD MYERS, AMS METEOROLOGIST: Absolutely. Almost two-thirds to more than that part of the country below freezing tonight and even places like Arkansas, Fayetteville down to nine degrees last night in some of the suburbs there. That's breaking pipes type of weather. The snow finally tapering off though for Buffalo and Syracuse but not before the damage is done. Look at these -- look at these numbers -- 24 inches in Perrysburg. This is kind of south of Buffalo. This is over on the other side near Lake Ontario -- 27 inches of snow in Redfield.

Now I recommend you sending iReports, -- down there on the bottom. It's the assignment desk. Send us your cool pictures. This one just makes me laugh. I guess the dog is enjoying it. I hope he was anyway. Get out there and enjoy it. Make sure the pets tonight are taken care of because pets do feel wind chill factor just like people. So just can't stick them out there in the wind and expect them to be comfortable. Rain showers coming into California as well.

So let's get to some of the pictures we have coming in -- come in from Ohio and also from New York, maybe even California. This is what it looked like near Austinberg, Geneva (ph) and Harpersville (ph). Now that would be east of Cleveland. I don't know if you watched the football game last night. Cleveland really didn't get any snow. They got the cold air. Oh, take the brakes off, take the brakes off and steer. They got it going. There you go.

And then we move you back out toward Ripley (ph), New York. And you know I harp on people to do the right thing. Please fill up your gas tank before you go out in the snow. That is why. Those people were sitting there from 1:30 in the morning -- I don't know when this was shot but clearly it's already light outside and could you imagine, running out of gas and not have any warmth in the car. That's why we tell you to do those things because you can get caught in these lake- effect snow events there in western New York.

And then quickly to California -- some quick shots here. Rain in the lower elevations, above about 5,000 feet, there's going to be a big snow event. I'm talking like Reno and Tahoe area, three feet of snow. Now the problem is getting there and you see the truckers chaining things up there and it's going to be trouble over all of the passes in California -- Erica. But it's -- hey, you know what? It's almost winter so that's what time it comes.

HILL: It felt like we waited for a while but clearly winter is arriving, Chad.

MYERS: Absolutely, loving it in some spots. I love that dog picture, though...

HILL: It's very sweet...


HILL: ... great point, really important to bring your pets inside tonight. They can't be outside in that kind of weather -- Chad, thanks.

MYERS: Make sure he can go out and play in it but make sure they don't have to sit outside in it all night long.

HILL: Yes. Coming up, the battle over health care raging on, Senate Democrats dropping the public option to rule moderates, but is that compromise actually working and just what does it mean for the cost of your coverage?

Plus, the horror in Juarez, Mexico, Michael Ware on the front lines of the Mexican drug wars, which are having a big impact here in the U.S. Plus a stunning development in the Tiger Woods scandal -- is the world's greatest golfer quitting the game?


ANNOUNCER: This is CNN TONIGHT live from New York. Here again Erica Hill.

HILL: The battle over your health care continues in Washington. In a ploy to build a filibuster proof majority Senate Democrats this week scrapping plans for a public option, instead they are now proposing to expand Medicare to cover millions of uninsured Americans.

Joining us tonight, Igor Volsky is a health care researcher for the liberal leaning Center for American Progress. Also with us Philip Klein, correspondent for the "American Spectator", a conservative leading publication and CNN senior political correspondent Candy Crowley (INAUDIBLE) good to have all of you with us tonight.

Candy, I want to start with you because off the top of the show Brianna actually broke some news for us. We want to talk about this loophole in the Senate reform bill that could allow insurance companies to set limits, annual limits on coverage but now it sounds like there's been some high level meetings at the White House and that could all change.

CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT: That's what it sounds like. It sounds like the loophole closed up. This obviously would be a major thing to people who suffer catastrophic diseases that can cost into the hundreds of thousands of dollars every year. So there certainly was great pushback from the American Cancer Society and now they've been told, as reported by Brianna, from both the White House and Capitol Hill that it's going away. It's done with. There will be no annual caps and no lifetime caps. So, look, this is squishy business, putting this all together, because we still are not at the finish line. We still don't have one bill, we have no bill yet approved by the Senate. So, all things are possible here, but at this moment, as we are speaking at 7:30 at night on the East Coast, at least the American cancer society seems satisfied that there will be no annual cap.

HILL: Apparently they were heard loud and clear because that was getting so much attention, today. A CNN poll found 61 percent of Americans oppose the Senate's version of the health care bill, which as Candy said, is not final, yet. Many Americans too, say one of the major problems here with any proposed reform is they just don't understand what's being proposed. I mean, 2,000 plus pages is a lot to look at.

Igor, I'll start with you. Why has this become such a mess?

IGOR VOLSKY, CTR FOR AMERICAN PROGRESS: Well, I think health reform in general is certainly a bit complicated. The American people are tired of the debate. It's been going on for months and months and months. We had markup and hearings and now finally we're on the floor. But also, we have this stream of misinformation and propaganda that's coming from the right that's polluting this debate about government takeover and pulling the plug on grandma.

I think if you look deeper into those polls, you see that the American people support the broad principles of reform. They support a public option, they support universal care and that's what the bills are about. HILL: You talk about what you see as misinformation from the right and do Democrats need to do a better job getting out a clearer message of what they're talking about in terms of reform.

VOLSKY: You know, I think message delivery is always a challenge, as we saw with this latest debacle, with this loophole that wasn't supposed to be there, but was. You know, we're trying to communicate these issues. They are hard, they're complicated, they have many layers in them and you know, I think it's a struggle, but I think when it comes down to the American people support what we're doing.

HILL: Phillip, I know you take the opposite view to that, that in fact there isn't as much support for this and you think the government needs to get out of the health care business.

PHILIP KLEIN, AMERICAN SPECTATOR: Well look, it's not a matter of my view. You just cited your poll which shows that 61 percent of Americans oppose this bill and only 36 percent support it. And I think if you look at some of the other numbers in that poll, they also showed that 79 percent of Americans think that the bill will increase the deficit, 85 percent of Americans think that it will raise their taxes.

So, what this shows me is the Democrats, on the substance, are losing every aspect of the health care debate. For months they have been talking about how it's going to lower the deficit and lower -- be a net tax cut, but Americans overwhelmingly don't believe it.

Now, whether they're going to ignore the American people and still try to ram this down our throats is another story entirely. But, poll after poll you can look at the Quinnipiac poll, not just your CNN poll, and interestingly I went back and looked at the CNN poll that was taken in May 2005 around the time that Bush's Social Security plan collapsed and that plan was actually more popular than this plan.

VOLSKY: You know, it's very interesting. We heard eight years -- for the past eight years we shouldn't look at polls when we do public policy, we should do what we believe it. And that's misinformation I'm talking about. We all know that the congressional budget office said that this bill would actually reduce the deficit and not increase it. And so let's be honest about the facts and maybe the American people wouldn't be so confused about this debate.

KLEIN: And I'd be happy to be honest about the fact, but that the problem is CBO report that you mentioned, the way it was designed is the spending provisions don't kick in until 2014, so that reduces...

HILL: And (INAUDIBLE) there are a number of different folks who have tried to look at the spending, the actual cost -- I'm going to let Candy jump in, here -- Candy.

CROWLEY: I just want to say just from a just from a political point of view, the Democrats believe and have decided that no bill is worse than something. So, there is going to be a bill regardless of when these polls say. There will also be -- there's a group of people who look at this and say the polls are not going to change until something is in place and then they will see how it works and then they will either -- the American public will love it or they will hate it. And you can make legislation and undo it.

And the other reality here is unintended consequences. You pass a bill this big and it's covering a sixth of the economy, things will happen you don't expect to happen. And so they will come back and redo it. But, I think it's very hard with polls or no, for Congress to back off this bill. I just don't think they're going to do it.

HILL: Candy Crowley, Philip Klein, Igor Volsky, appreciate all of you being with us, tonight.

KLEIN: Thank you.

HILL: We want to get you to breaking news. The world's best golfer, Tiger Woods, making an announcement about his career, tonight. Does it have anything to do with his alleged sexual scandal? Well, a statement just released he says he's going to take an indefinite break from the sport. Joining us with more this, Susan Candiotti who's been following this story.

So, this is it. Indefinite break? No date on that?

SUSAN CANDIOTTI, CNN NEWS CORRESPONDENT: No date on that. Remember the last time we heard him mention anything about this he said he wasn't going to play golf professionally until at least the beginning of next year. And to think, Erica, that all of this started with a simple traffic accident on Thanksgiving night. And now as more details of his alleged personal failings are coming down around him, this announcement.

And we have a quote from it. It was posted, again, on his Web site. We're not hearing from tiger himself, this is on his Web site. So, let me read in brief what it said, in part.

"I'm deeply aware of the disappointment and hurt that my infidelity has caused to so many people most of all, my wife and my children. I want to say again to everyone that I am profoundly sorry and I ask forgiveness. It may not be possible to repair the damage I've done, but I want to do my best to try." And then he adds "after much soul searching I have decided to take an indefinite break from professional golf. I need to focus my attention on being a better husband, father and person."

HILL: There's been a lot of talk this week about the impact these allegations could have on him as a brand, on the Tiger Woods brand and whether or not some sponsors are going to pull back. Has there been any talk since this statement came out, and I know it's just surfacing, but any talk about how him not playing the game could affect those deals that he has?

CANDIOTTI: I think it's too early. Certainly, we haven't gotten the reaction as yet. But, this is a man who said to be worth up to a billion dollars in businesses that he is associated with and lending his name, his good name. And there's been a lot of cross talk among business community about what he would do to try to repair his image.

Because of course, sure, there must be fallout, and already, a lot of experts are saying that these firms, the companies that he has endorsements with are certainly taking the pulse of the public to see how they're going to react and we already know that we haven't seen any of his ads running since late last month, so certainly there is an initial impact most likely, as they're assessing where things stand. I think he recognizes that. It seems pretty apparent and he wants to take a step back, according to his statement, and see where things stand and see whether he can improve his image.

HILL: It'll be interesting to see since he is notoriously private, as we know, and especially on this we haven't seen him at all. Interesting to see when he will surface next and we'll get the next statement on the Web site. Susan, thanks.

CANDIOTTI: You're welcome.

HILL: Just ahead, on the streets of Juarez, Mexico, it is a city so violent it's called "Baghdad on the Border." CNN's Michael Ware will take us to ground zero on the war on drugs.


HILL: I want to warn you, this next story is graphic and frankly difficult to watch at times, but it's a necessary story. CNN's Michael Ware spent a day and night with police in the border town of Juarez, Mexico, that's just over the U.S. border from el Paso. And he witnessed firsthand the horrors that take place in Juarez every single day. Horrors affecting the often innocent victims of Mexico's drug war.


MICHAEL WARE, CNN CORRESPONDENT (voice-over): This footage is difficult to watch, these anguished cries impossible to forget, relatives entering this building seeking the bodies of their loved ones executed by a Mexican drug cartel.

You're witnessing the pain of the Mexican border town of Juarez. The front line in the war on drugs, and this a crime scene I just had to see for myself.

(on camera): There's so much violence that occurs here in Juarez that the world just does not hear about.

And, now, it's disconcerting to see this fresh paint here on these walls as an old woman makes her home in this building, for, just two months ago, this literally was a corridor of blood.

This building had been a drug rehabilitation center. And one of the major cartels suspected that its rivals were recruiting foot soldiers from among the patients. So, they came in this door and down this corridor, moving from room to room to room, executing everyone they found.

While they're now trying to build a home, this is where 17 people died in yet another day of Juarez violence.

(voice-over): Within two days of this attack, the death toll rose even higher, when two survivors died in hospital.

And there is no discrimination to the slaughter. Under these clothes lies a 7-year-old American boy, his father the target, but the hit man chose not to let the child live.

On this day, we're in Juarez to see the horrors for ourselves. It's just before dusk as I approach a fresh crime scene.

(on camera): In Juarez, 1,600 people died from drug-related violence last year. This year, the total's already well over 2,000. And today's total is already at 12.

The man in that car was hit by cartel gunmen, riddled with eight bullets. His passenger tried to flee, but only made it that far.

(voice-over): This was yet another afternoon of killing in Juarez, with a night of murder yet to follow.

(on camera): It's only 9:00. We're now going and joining this police patrol. Since the killings this afternoon that we saw, there's already been another homicide, bringing today's total to 13.

(voice-over): Every night, joint patrols like this one between local and federal police and Mexican soldiers crisscross the city, trying desperately to stem the flow of blood.

(on camera): Things were so bad that, earlier in the year, the Mexican president had to call in the military to help protect the city. For a short time, there was a lull in the violence, but it quickly returned. Now, it's worse than it's ever been before.

(voice-over): By now, it's close to 10:00 p.m., and the reports of violence are streaming in over the police radio.

(on camera): The patrollers just received another call on the radio. There's some kind of incident. But those lights there, that's America. It's the U.S. border. This reminds you just how close this war on drugs is being fought to American soil.

(voice-over): But, before the night is over, there is even more carnage to come, all this in our one afternoon and evening visit to this deadly city.

(on camera): This time, it's almost too much to bear. It's just after 11:00; and where you see those policemen gathered at that door, there's just been four more slayings, this time all women.

The early reports are that a gunman walked in that door and executed all of them, one of them a 12-year-old girl, another one 14, and, in a gut-wrenching irony, all of this done with the American border crossing just here, 80 yards away.

There can be no more pertinent reminder of the Mexican blood that's being spilt in this war for the right to supply America's demand for illicit drugs.

Michael Ware, CNN, Juarez, Mexico.


HILL: The seemingly unless demand for illegal drugs is being serviced, it turns out, both above and below ground. Tunnels from Mexico to the U.S., not the first time you've heard about it, but there is a new tunnel to tell you about. In fact, one is discovered just about every year. The complexity is amazing. Tonight on AC-360, Anderson Cooper takes us inside a border tunnel complete with an elevator, electricity, even a ventilation system. That's coming up at 10:00 Eastern tonight, on AC-360.

Meantime, in a clear illustration of just how far drug cartel violence may have reached into this county, a major drug ring busted tonight in New Jersey, 28 people arrested following a nearly two-year investigation. The group is charged with smuggling crystal meth and marijuana up to 150 pounds of marijuana and six pounds of crystal meth transported each week, by car. Authorities also seized 10 firearms, including two atomic assault weapons.

Just ahead, the climate change debate really grabbing headlines this week. Three of the country's best political minds will weigh in with their take on not only climate change, climate-gate, but also the president's upcoming trip to Copenhagen and the impact any of this will really have back, in the U.S.


HILL: Joining me now, three of the country's best political minds, all CNN contributors. Democratic strategist, Robert Zimmerman, Errol Louis, "New York Daily News," and syndicated columnist, Miguel Perez.

Good to have all of you back. As we mentioned before the break, the president, of course, heading to Copenhagen at the end of next week, at the end of the climate conference, there. There's been talking about it this week and what the U.S. needs to do.

I'll start with you on this one, Miguel, anything that you're seeing coming out of it or impact you think the president may have in Copenhagen that's going to have a significant impact here at home on the way things are done?

MIGUEL PEREZ, SYNDICATED COLUMNIST: Well, it's the other way around. I think he has to have the support from Congress here at home so that he can go over there and show some leadership. This country needs to show some leadership on this front and unfortunately Congress hasn't moved fast enough for the president to go out and show that leadership. HILL: So, in terms of what would signify that leadership? Or there was this bill introduced yesterday, a bipartisan bill, three senators, to look at some things that could be done, here.

ERROL LOUIS, NEW YORK DAILY NEWS: I think the key word is bipartisan. I mean, he's been looking for bipartisanship, which is one of his major campaign problems, since he didn't get on TARP, he didn't get it on the bailout, he didn't get it on the auto bailout, he didn't get it on health care, certainly. Now, it looks like he actually might get it on climate and I wouldn't have guessed that that would be the place.

HILL: It's one of the least likely things that would you imagine, because climate change, people are very set in their camps on this.

LOUIS: For the most part. But you know, I mean, when it comes to nuclear and some of the other drilling concessions that they seem to be giving back to the antienvironmentalists, if you want to call them that, it looks like it's something that could actually work.

HILL: It could work, but of course, it would actually have to be passed and it's going to have to get a little bit more support. What are the chances of that -- Robert.

ROBERT ZIMMERMAN, DEMOCRATIC STRATEGIST: My prediction, climate change bill or as it's referred to, Pollution Reduction and Investment Act, passed by the end of 2010. You see, the House has already put their bill through. The Senate has -- three of the committees have put their versions through, the Kerry, Boxer and Granville, through.

And ultimately, well, you know, we hear this debate amongst pundits about whether climate change is real or not. In the Congress, I think the members from both sides, they know it's real, they know it has to be addressed. The bigger question is, are there political -- you can score any political points for it?

HILL: Well, and especially with mid-term elections, of course, coming up, that is a major concern for all of these lawmakers, especially those facing re-election.

Another major concern, health care reform, which as Errol pointed out, not a lot of bipartisan support, there. Candy Crowley made a great point earlier in the program, that you know, for Democrats no bill is better than a bad bill, they can go back and fix it. Robert, is that the best route to take?

ZIMMERMAN: It is the route that's taken. You speak to members on the Hill, they know they have to move this through, they've got to get it done. It will be signed into law, I predict, by the president's State of the Union. And the reality is, they've got to move this off the agenda so they focus on jobs, which is topic No. 1 of the American people.

HILL: But there is a concern on the other side, OK, great, so, you get a bill passed, but changing that bill could prove be even more difficult than getting the initial one passed. So, is that the smartest way, especially, Errol, with elections coming up for Democrats to go about this?

LOUIS: Yeah, well unfortunately it is. I mean, what I have been hearing from staffers on the Hill and from people who try to influence those staffers is that, an enormous amount of national conversation about all kinds of topic is completely gummed up. You can't get the attention of people, the senators are in round-the-clock negotiations. You can't talk to them about anything. And so, everybody wants this done including the White House, by the way, they want something really, really badly.

PEREZ: Just because everything is tied up doesn't mean that we settled for a bill that really doesn't do what we intend it to do in the first place. We need that public, in my option. I mean...

HILL: But it doesn't sound like -- I mean, that sounds like that is done at this point.

PEREZ: Well, what we're doing is we're diluting this legislation so much that by the time they finish with it, it won't be...

HILL: Do you think there was a distraction. There was so much focus, especially in this House bill, on abortion, on one issue, which is, obviously very controversial in the country. But was there too much focus on that one issue, and how this reform could affect whether or not that one issue was covered as opposed to the greater issue of health care for this country?

ZIMMERMAN: You know, I think you're on to something very significant. There's a reason we haven't had health care reform in 60 years, this is a very hard initiative to put through. It's -- a lot of moving pieces with it. We just saw Brianna Keilar's report today, the issue of catastrophic illness and the caps on care. That really -- and the way -- by the way, this is a real problem, because the way it was disclosed, through a loophole, and the way it came up from the American Cancer Society, really undermines people's confidence in a bill that's going to address such important issues.

HILL: And their confidence in their lawmakers. And Errol, I'll let you round this out. We have about 30 seconds. But interesting, too how quickly they were able to get that changed, today.

LOUIS: Oh yeah, oh yeah, oh yeah.

HILL: Versus some of the other issues.

LOUIS: Listen, I tell you, I think that when it comes to fixing the bill later on in the years to come, Congress is actually pretty good at that. You know, they're not so good at what they're trying to do now and that's why I think everybody wants to see this just get done. Once they get over the hump, I think that we'll see lots of loopholes like that get fixed.

HILL: And a big old hump to get over, though.

ZIMMERMAN: I'm optimistic.

HILL: Especially in the next couple weeks.

ZIMMERMAN: For the first time Hanukkah, so I'm optimistic.

HILL: Well, you have to be hopeful. Hey, if the oil could cast eight nights, who know what they can do in Washington.

MIGUEL: But, that loophole has a potential of destroying the whole thing if we don't deal with it.

HILL: It could although it did sound like they did get it fixed at those meetings at the White House. Miguel Perez, Errol Louis, Robert Zimmerman, good to have all of you with us. And happy Hanukkah.

ZIMMERMAN: Thank you.

HILL: Coming up at the top of the hour, Campbell Brown.

Hi Campbell.


We are going to be talking more about what does appear a breakthrough as they attempt to close that loophole on the health care legislation, but also tonight, some breaking news. Tiger Woods, we hear now, taking an indefinite break from golf. What does this for him, what does it mean for the game of golf? What does it mean for all of those companies who have endorsements for him? We'll have all the answers on that front, as well, tonight -- Erica.

HILL: All right, we'll be watching, Campbell, thanks.

Still ahead, "Heroes." Tonight, we'll introduce you to Army Specialist Joshua Orcutt And tell you how his quick thinking saved his fellow soldiers.


HILL: "Heroes" is our tribute to the men and women who serve this country in uniform. Tonight, we introduce to Specialist Joshua Orcutt. He was serving in Afghanistan as a gunner when his caravan came under attack. Philippa Holland tells us how his quick thinking saved the lives of his fellow soldiers.


PHILIPPA HOLLAND, CNN NEWS CORRESPONDENT (voice-over): After two years in college studying criminology, Joshua Orcutt decided it wasn't for him. He joined the Army, serving as saw gunner the infantry.

SPEC JOSHUA ORCUTT, U.S. ARMY: He's one the most important people on the team. When you take contact, it's usually the saw gunner who will open up first and lace pressing fire. So, it's -- it's a hard job to do, but I'm -- it just carries a lot of responsibility.

HOLLAND: In July 2008, he deployed to volatile Korengal Valley in Afghanistan.

ORCUTT: It was difficult at first. Just the terrain overall and people and their culture's a lot different. So, it was hard to get used to.

HOLLAND: Two months after arriving, Orcutt's unit was searching a valley for suspected weapons cache in enemy sighting positions. Orcutt was assigned to drive a Humvee that day. Their convoy came under heavy machinegun and RPG fire.

ORCUTT: I was the fourth vehicle. The third vehicle, the vehicle in front of me, the gunner was immediately hit and he fell. And the vehicle was destroyed in the kill zone. Several RPGs destroyed the engine block. So, they had machinegun fire blow out their tires, so they were completely stopped.

HOLLAND: With no room to maneuver around the disabled vehicle, Orcutt had no choice but to push the Humvee out of the way.

ORCUTT: The Humvees barely fit on the road as it is. there was no room to either side, we had a cliff wall to one side and a mountain to the other side.

HOLLAND: Under heavy enemy fire, Orcutt's vehicle pushed the Humvee almost 3-1/2 kilometers before the road was wide enough to get around.

ORCUTT: I pushed the engine block, finally to the point where it just -- my vehicle shut down.

HOLLAND: The disabled Humvees were then towed back to base. Orcutt's actions saved the lives of four soldiers in the disabled Humvee. For outstanding performance under fire, Orcutt received a Bronze Star for Valor.

ORCUTT: There is a lot of people that probably -- that deserve to receive the award, other than myself, I know I don't feel that I deserve it. But, I was thankful that they gave it to me and, just wish, a day could be happen, if something -- I could do something, something more.

HOLLAND: Philippa Holland, CNN.


HILL: Specialist Orcutt plans to re-enlist in the Army and says he'd eventually like to return to college, get his degree, and teach military history. Wish him all the best with that.

I'm Erica Hill. Thanks for joining us on CNN TONIGHT. Stay tuned, Campbell Brown come your way, next.