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American Morning

Giffords' Condition Upgraded to Good: Headed to Rehab; Eric Cantor on State of the Union Address: Can Democrats and Republicans Work Together; Taco Bell Defends Its Beef; Rahm Still in the Mayor's Race

Aired January 26, 2011 - 06:59   ET

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

T.J. HOLMES, CNN ANCHOR: Good morning.

It's our Sputnik moment -- President Obama challenging America with words from the past to win our future. We have everything you need to know about the State of the Union last night.

Also, we are about an hour away from the next remarkable step in her remarkable recovery. Gabrielle Giffords, her condition upgraded and headed to rehab today -- on this AMERICAN MORNING.

(MUSIC)

HOLMES: And good morning to you all on this Wednesday, January the 26th. Welcome to this AMERICAN MORNING. I'm T.J. Holmes.

KIRAN CHETRY, CNN ANCHOR: And I'm Kiran Chetry. Glad you're with us.

Up first we're talking about President Obama in the State of the Union last night urging the country drowning in debt to try to think big. One of the big themes of last night's state of the union, another was unity. Lawmakers themselves trying to strike a more civil tone, and one seat remaining empty for Congresswoman Gabrielle Giffords, who is still in the ICU but could leave it to head to rehab sometime today.

HOLMES: And the mood was a little different in that chamber and the theatrics a little different as well. You had some strange seat fellows last night. Democrats and Republicans deciding to sit together rather than sit on separate sides of the aisle as they traditionally do. The president calling on the group to seize this "Sputnik moment."

(BEGIN VIDEO CLIP)

BARACK OBAMA, (D) PRESIDENT OF THE UNITED STATES OF AMERICA: The future is hours to win. But to get there, we can't just stand still. We need to out-innovate, out-educate, and out-build the rest of the world. We have to make America the best place on earth to do business. We need to take responsibility for our deficit and reform our government. That's how our people will prosper. That's how we'll win the future.

(END VIDEO CLIP) CHETRY: In keeping with the new spirit of bipartisanship, the president may have taken a lesson or two from his predecessors. A very popular Republican and Democrat, we have Ed Henry live at the White House for us this morning. For those of us or those out there who may not have been born during the space race, when he talks about the sputnik moment, explain it, Ed.

ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Certainly. Look, the Soviets got ahead of the U.S. and the president's point was Sputnik forced America to innovate, figure out how to get ahead of the Soviets and it paid dividends many times over.

So I think he was also stealing some pages from Ronald Reagan, first of all, who also in a different era took on the Soviets and was very optimistic about it, just as the president is now saying we need to compete with China and India and other countries like that.

When you talk about the future is bright. That optimism sounds a lot like "morning in America" 1984 when Ronald Reagan cruised to a reelection victory after a tough midterm, and then pushed forward on some of the other issues he touched on. On health care, for example, the president defended his law, joked a little bit about the Republican efforts to repeal it, held that out as sort of an extreme, but said, look, I'm willing to work with you if you want to meet me halfway on making it better, trying to steal a page perhaps from Bill Clinton after the '94 election and saying, look, I'm going to work with you but I'm going to find the middle ground. If you're going to be on the right on the issues, I'll be in the center.

That is a direct appeal to the independent voters that supported this voter in 2008, abandoned him in 2010. They want him there in 2012, and perhaps the best message for this White House in terms of Reagan and Clinton, they both had tough midterm election losses but both came back and got reelected two years later, T.J. and Kiran.

CHETRY: It's also interesting too, because one of the topics was growth and looking to the future in innovation and the other was how to tackle the growing budget deficit. The president talked about a five-year freeze on non-security discretionary spending, but when you look at the whole budget, that's pretty much a drop in the bucket.

HENRY: It really is. This is an area where critics will say you better not take a page from the Reagan playbook because the downside of all the Reagan optimism programs was the huge budget deficits that he passed on to his successors.

And so the president put out what White House aides are saying is a down payment, this five-year free on some parts of the budget for the next few years. That will save about $400 billion over ten years. That's nowhere close to wiping out the trillions of dollars in debt.

So this is a down payment, but there's a lot more specifics and details that need to come.

CHETRY: Ed Henry for us this morning, thanks. HOLMES: You might want to turn to the Republican responses last night. There were two from two different Republicans. The first one was billed as the official Republican response. That came to us from the Wisconsin Congressman Paul Ryan, who is the chair of the House budget committee. Then a short time after that Minnesota Congresswoman Michele Bachmann, a Republican as well, giving what was billed as the Tea Party response. Take a listen to them both.

(BEGIN VIDEO CLIP)

REP. PAUL RYAN, (R) WISCONSIN: The president and the Democratic leadership have shown by their actions that they believe government needs to increase its size and its reach, its price tag and its power. Whether sold as stimulus or repackaged as investment, their actions show they want a federal government that controls too much, taxes too much, and spends too much in order to do too much.

REP. MICHELE BACHMANN, (R) MINNESOTA: We wondered whether the president would cut spending, reduce the deficit, and implement real job-creating policies. Unfortunately, the president's strategy for recovery was to spend $1 trillion on a failed stimulus program fueled by borrowed money.

(END VIDEO CLIP)

HOLMES: All right, she's talking about deficits, the president talking about deficits. Stephanie Elam to talk about deficit, and I guess you're probably the one that can give us more of a reality than we heard last night.

STEPHANIE ELAM, CNN BUSINESS CORRESPONDENT: Somebody has to bring it all together. Even if they have state dates, someone has to break it up, bring it together. That's my job this morning.

If you take a look at what's going on, you heard President Obama talk about how there used to be a freeze on how much the government is spending on these nondiscretionary needs. This is something previously last year he said he wanted for three years, and now he says five years. Sounds great considering our deficit issues. The problem is it's not going to really affect as much.

Taking a look at this, it's going to impact less than 15 percent of the overall federal budget. And some things are excluded. Defense is excluded. They're also saying spending on Homeland Security and veterans are being excluded as well. It also excludes the mandatory spending you would find in, say, for Medicare, Medicaid, and also Social Security.

So if you factor that in, the White House says the phrase will save the country $400 billion over a decade. The problem is that when you look at the spending increases are expected for Social Security and Medicare, it's probably not going to have that much of an effect.

So take a look at this chart that we have here for you -- 76 percent of every tax dollar, this is where it's going -- to Medicare, Medicaid, Social Security and also interest. This over $2 trillion from 2011, that's going to be there. The 24 percent is what they're targeting. That's everything else so that $519 billion -- we did a little math early this morning for you to see what that part is. but keep in mind tales just a portion of that $519 billion.

HOLMES: The other part and a big part of the lame duck session, this is one way to get rid of this debt and did he have sit -- not continue with the tax breaks for the wealthiest Americans. The president hit on that again last night and this will probably sound familiar to you.

(BEGIN VIDEO CLIP)

OBAMA: And if we truly care about our deficit, we simply can't afford a permanent extension of the tax cuts for the wealthiest two percent of Americans. Before we have to take money away from our schools or scholarships away from our students, we should ask millionaires too give up their tax break.

(END VIDEO CLIP)

HOLMES: That was a part of the compromise deal, extend the tax breaks for the wealthiest for another two years. How much will that cost us?

ELAM: There are a lot of people hot about that, because those tax cuts expired at the beginning of the year. But look what they would do. You talk about this two-year extension, $81.5 billion that could actually go back into the pot to help out the deficit.

So this is the reason why people were upset last month about this saying this could help us out. We have this issue but also taking a look at the fact some people want it to be a permanent tax cut and he says he doesn't want to make it a permanent one. Just a deal he worked out with the Republicans to get that machine moving.

CHETRY: The criticism was if you have raise taxes on anybody pulling out of recession it may affect small businesses.

ELAM: People have less money their wallets. Rosy, right?

CHETRY: We'll, we have a lot of work to do.

(LAUGHTER)

Daniel Hernandez, the intern who helped save Congresswoman Gabrielle Giffords' life. He sat with the first lady as President Obama gave his address. But before the speech Hernandez, who was also celebrating his 21st birthday last night, helped present a flag to Giffords' office, that flag signed by some of the first responders from September 11.

Giffords' husband Mark Kelly also was watching last night's address in Giffords' hospital room. And you can see a picture of husband and wife holding hands. He was invited, but he chose to stay back in Houston.

HOLMES: That was a very touching picture last night when I saw it come out. You may notice right there on his shirt he was wearing that black and white ribbon. That's the same ribbon members of Congress were wearing last night. Those were in memory of the Tucson shooting victims.

Also the president giving a warm welcome to the new House Speaker John Boehner. He mentioned Boehner's first job of sweeping floors, and you know how this goes with this guy. It prompted a little tremble of the speaker --

CHETRY: He didn't cry. He held it in.

HOLMES: He didn't cry. This was huge for him that he did not cry. A lot of people probably expecting it. I have no problem with a guy being emotional, showing his emotions. But come on, dude.

CHETRY: T.J.!

HOLMES: Everybody gives him a hard time. He takes it in stride. The man wears his emotions on his sleeve and there's nothing wrong with that. I'll be crying before this show is over.

(LAUGHTER)

Also, another star from last night's address was a woman you probably never heard of, Kathy Proctor, in the audience. The president mentioned her by name. And you know what, you might not know who she was but she let folks know who she was.

CHETRY: So cute.

(BEGIN VIDEO CLIP)

OBAMA: One mother of two, a woman named Kathy Proctor, had worked in the furniture industry since she was 18 years old. And she told me she's earning her degree in biotechnology now at 55 years old.

(END VIDEO CLIP)

HOLMES: That's great.

CHETRY: I mean, that's such a great reaction.

HOLMES: That's an authentic moment there because nobody knew. Nobody sitting next to her, and it's clear there were strangers sitting around her, and I'm getting my props right now and you need to know who I am.

(LAUGHTER)

CHETRY: Good for you, Kathy Proctor, and good for you on what you were able to accomplish.

Much more on the State of the Union ahead. We will hear from House Majority Leader Eric Cantor. T.J. talks to him in a couple of minutes. Did he hear enough from the president about cutting the deficit? Also we'll check in with Jim Acosta. He's fact-checking some of the comments by the president and Republicans. And at 7:40 Jason Carroll gets to hear what people thought about it. He's going to be checking out reaction from a diner in New Jersey.

HOLMES: And the president last night, he started his address by taking a moment to remember Gabrielle Giffords, who is still recovering in a hospital in Houston.

The congresswoman now in her recovery -- it has been remarkable, now she's moving on to a next step. First of all, doctors have upgraded her condition. She is now in good condition they say. She's expected in some 50 minutes from now to move out of the ICU there at the hospital in Houston over to its rehab center.

Now, we will be covering that for you live this morning when it does happen, hope to bring you live pictures of it. You're seeing other pictures here when she first got to Houston with her husband. But our senior medical correspondent Elizabeth Cohen is there in Houston for us. We'll check in with here in just a few minutes.

CHETRY: To extreme weather hitting the south, heavy winds, rain leaving damage. There's a shot in St. Petersburg where a gas station canopy collapsed onto a car. The driver was trapped inside. A witness describes what happened.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: It was about 5:15 or something. The rain started blowing sideways harder than I've ever seen and I've been down here 34 years. It was blowing so hard, it would have went through cinderblock, no problem. She tried to leave. She couldn't guest the front door open. He tried to help her. He was having a hard time. I tried to come over before I even got there, the awning came down.

(END VIDEO CLIP)

CHETRY: Firefighters were able to rescue the driver. She was taken to the hospital and she is doing OK.

It's 12 minutes past the hour right now.

(WEATHER BREAK)

HOLMES: We've been telling you this morning about Gabrielle Giffords supposed to be moving from the hospital to rehab. We've gotten new guidance about that. We're expecting it 8:00 eastern time. Now we're being told it's sometime this morning.

So we want to be clear we've been told guidance would happen in the next 45 minutes or so. They anticipated it, but now saying sometime this morning. We'll keep a close eye on it. As soon as it happens you can finds out about it right here on CNN.

Meanwhile, will it make a difference if you go into the store to buy your favorite fatty food? Instead of turning it on the back to see how much fat is in it, if it's in the front in your face, are you going to buy it and eat it anyway?

CHETRY: Yes. Sorry, you weren't asking me.

Growing violence in the streets of Cairo. Police clash in the south with demonstrators. They are angry about the lack of freedom and they say they want the president out.

It's 14 minutes past the hour.

(COMMERCIAL BREAK)

HOLMES: 1.7 million vehicles being recalled worldwide. Toyota is recalling them. Two separate recalls to tell you about here and they have to do with the defect that could cause fuel leakage. This involves certain Lexus luxury 300 and 350 models made in '06 and '07. Also, Lexus IS250 from '06 to '09. Also, 305s from 2006 to 2008 model years. Another recall includes vehicles not sold in America. Most of these vehicles, again, are from outside the U.S., but many of them you need to check and make sure one of them is not in your driveway.

CHETRY: Well, this is about pretty much one of the dumbest things you can do. Try to pitch yourself out of the window of a speeding car handcuffed. What -- this burglary suspect tried to do it. There you see the video and he just tries to make a break for it, literally leaping head first out of the window even though he was handcuffed.

This happened in Utah. Police say when they realized what was happening, they slowed down to 35. They say they had put the window down because the suspect was high when they arrested him and he was vomiting. Sorry, that's an unpleasant detail but I guess that explains the pan there too. Somehow he did not get hit and did not break a single bone in that fall.

HOLMES: All right. So we have to give the details of the story, give some perspective of what was happening there.

Also calories, salt, sugar, saturated fat. You know it's in the stuff but sometimes you don't turn on the back of the label to actually see it. Just want to have some deniability there. You just don't want it in your face.

Well, now, it's going to be in your face. There are some new front- of-the-pack food labels that will be at many of your grocery stores coming up soon. The food industry unveiled them this week. They did this voluntarily. Many critics say they did this to try to get around another plan for putting some of this information on the front of the packages that's being developed by the FDA.

CHETRY: Is that one in 3D or something? I think people are getting the point.

HOLMES: They want to do -- but you know they don't make -- you don't need to turn on the back, the front, the inside to know a doughnut is bad for you.

CHETRY: Exactly.

Well, Congresswoman Gabrielle Giffords is expected to check out of intensive care sometime this morning, going into a rehab facility at the TIRR Memorial Hermann Medical Center. That's in Houston. Her condition is now been upgraded from serious to good. Senior medical correspondent Elizabeth Cohen joins us now this morning. And this was great to hear. I mean, yesterday we were hearing more details about the concerns with the fluid on the brain and now they're talking about, you know, the upgraded condition and transferring her. So it sounds like some big progress made overnight.

ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: Right, Kiran. Presumably that condition called hydrocephalus that you just referred to, apparently it has resolved itself. Either it went away on its own or perhaps doctor installed an internal drain to drain that fluid away. We don't know. We're hoping to find that out when they have a press conference this afternoon. But doctors have been saying here for several days once that hydrocephalus was taken care, she'd be ready for rehab which will be in the hospital behind me -- Kiran.

CHETRY: So the hospital isn't giving an update. They haven't given an update since Friday. But you had a chance to talk exclusively to her neurosurgeon. What did you learn from him about her prospects and her condition?

COHEN: Right. I sat down yesterday with Dr. Dong Kim (ph). He's the head of neurosurgery here. And he said that they have been pleased every day with her progress. Every day they have seen her do something that indicates that she is getting better.

And I also spoke with Congresswoman Wasserman Schultz, Debbie Wasserman Schultz. And she said that she heard from Giffords' husband and he said that the other night Giffords watched an hour of television. And that doesn't sound like much, Kiran, to you and me but really, apparently that was a big deal. He was excited about it. It showed that she could have an hour's worth of attention span and I'm happy to say that she was watching CNN -- Kiran.

CHETRY: Yes, that's great. We also heard from Scott Kelly, her brother-in-law, that he's getting updates by watching CNN and her condition. And we also saw the picture of her watching the State of the Union last night, as well. So remarkable strides. What happens now, though, that she goes to rehab? What is she going to be facing there?

COHEN: All right. Well, she could be in this rehab hospital for anywhere from four to six months. Might be less. Might be a little bit more. But as one doctor told me, it's a marathon. It is not a sprint. She's got to learn how to do really simple things like stand up on her own, walk again, dress herself. All of that. She's got some strength on her left-hand side. Her right-hand side doesn't have quite as much strength, they tell us. So she still has a long way to go.

CHETRY: All right, Elizabeth Cohen for us this morning. Thank you. HOLMES: All right. Well, they were able to sit together last night. Are they able to work together today? We will ask the House majority leader when he joins us live next.

CHETRY: Also, it's one of the best companies to work for in the world, one that just gave its employees a 10 percent across the board raise. And now, it's hiring a lot of people. We're going to give you details on what you may want to do if you want to work for Google.

(COMMERCIAL BREAK)

HOLMES: It's 25 minutes past the hour. The president says, yes, we can sit together tonight, but can we work together tomorrow? Well, today is that tomorrow he was speaking of. So can they work together?

I want to bring in now to ask that question. The House Majority Leader Eric Cantor is going to be from Capitol Hill.

I know you had a late night. We appreciate you taking the time with us this morning. I know you've been to a number of these State of the Union addresses before. Given all the talk of civility and people sitting together, did it actually feel different in that chamber last night?

REP. ERIC CANTOR (R), HOUSE MAJORITY LEADER: T.J., it was always a momentous occasion when the president comes to Capitol Hill. Last night, you know, we're still on the heels of a very tragic incident with our colleague, Gabby Giffords, and others in Tucson. And I think there is certainly an amount of reverence that all of us have for that terrible situation. And I do also think the gravity of the challenges that we face as a country did have some impact on the tenor of last night's session.

HOLMES: Well, sir, there are times in all these speeches where everybody can agree and there are certain applause lines that everybody will get up and clap on, when the military is honored or things like that. But what did you hear from the president besides those lines that made you jump up out of your seat and enthusiastically applaud the president?

CANTOR: Overall, the president talked about a way to a better future. And, you know, T.J., I'm a father of three teenagers and that's certainly my first priority. You know, there's a lot of areas that he and I will disagree. I think I'll probably want to cut spending more than he does. You know, I have a different view on how we improve health care in this country. But I do think that the president put forward some ideas that we Republicans can work with him on.

HOLMES: Which ones?

CANTOR: As far as job creation. He talked about lowering the corporate rate. He talked about simplifying the tax code. He talked about working together on these trade deals so we can get jobs going here at home.

These are the kind of things that the American people want us to work on to get this economy going again. And I look forward to working together. After all, T.J., I think that, you know, like the president, I'm a results-driven kind of guy. I want to see something done.

HOLMES: Mr. Cantor, you sound like you're striking this morning a conciliatory tone. Mr. Ryan last night in the GOP response sounded the same. But then in Michele Bachmann's tone, it was different from the one I'm hearing from you and the one I was hearing from Mr. Ryan last night. Do you wish she had not done that?

CANTOR: T.J., all members of Congress have an ability to speak out as far as their views on the direction of this country. After all, we're elected to represent the will of the people that actually we represent. So, you know, I don't fault anyone for taking their message to the people that elect them. And I do think, though, we can all work together.

There are differences. T.J., we've got priorities that the Republicans have put forward and we believe that first things first, you've got to cut spending and you've got to cut it a lot more than what the president has advocated. Certainly we'll have some disagreements, but I do think we can all move forward together, get people back to work and actually produce a better future than the president talked about.

HOLMES: Well, sir, last thing on that tone and on the Tea Party response that Ms. Bachmann gave last night, is there some way you think that over -- not even overshadowed but in some way was competing against the official GOP response, her tone was certainly different from the official GOP response. And are you bothered that CNN broadcast her response, thereby elevating it in some way?

CANTOR: I'm not bothered at all, T.J., about CNN's covering it or any other network. I think this response that Michele Bachmann had echoed the official response of Paul Ryan. We are about trying to cut spending, focus on jobs in the economy, shrink the government so we can expand economic freedom and liberty for all and get people back to work. That's what we're about and we should all be results-oriented to try and make that happen.

HOLMES: Well, Majority Leader Cantor, we appreciate you taking the time. Certainly a lot of people watching you all closely, pulling for you and hope some civility can prevail long term. But thank you for your time this morning.

CANTOR: Thank you, T.J.

HOLMES: All right, Kiran.

CHETRY: Well, the president making some promises, touting his accomplishments during last night's State of the Union address. Republicans and Tea Party members fired back with some counter claims. So who is telling the truth and who is stretching it? Jim Acosta joins us with a fact-check when we come right back.

And we're keeping eye on the weather. The Ohio Valley, the mid- Atlantic, parts of the northeast waking up a little bit snowy already and more in the forecast. Jacqui Jeras breaks it down. The travel forecast in 15 minutes.

We'll be right back.

(COMMERCIAL BREAK)

HOLMES: Good morning to you, Louisville, Kentucky. A live look at that town this morning. They are seeing a rough start to the day. We can call it a rough start. It's just winter. They got a little snow and a little sleet. Could make the commute a little messy but they will have their highs in the lower 30s today. So not going to warm up a whole bunch. Good morning to you all. Bottom of the hour here on this "American Morning." I'm T.J. Holmes.

CHETRY: I'm Kiran Chetry. Glad you're with us this morning.

Is it the start of the 2012 trail? Well, after the "State of the Union," President Obama is heading to Wisconsin today, visiting three factories that he says are investing in the ways that he mentioned in his speech. Other cabinet members will also be in Illinois and South Carolina today.

HOLMES: Looking for a good company to work for? How about this one? Google, they are hiring. A record number of workers this year. Another 6,200. Google right now ranking as number four on "Fortune's" list of best companies to work for.

CHETRY: So if you want to find out how to apply, just Google it.

HOLMES: Oh, well..

CHETRY: Former White House chief of staff Rahm Emanuel campaigning in Chicago after the Illinois Supreme Court kept him in the mayor's race. The court ruled he must stay on the ballot until they rule on his appeal. Earlier this week, a lower court said that he hadn't lived in Chicago long enough to run for mayor.

HOLMES: Well, we're trying to separate a lot of fact from fiction after last night's State of the Union address. The president, as always presidents do, they make some promises in these things, promising to eliminate excessive spending was one of them from last night. Also wants to simplify the tax code and hire more teachers.

CHETRY: Also he's pledging to eliminate billions of dollars in taxpayer subsidies that are currently being funneled to big oil. He's vowing to rebuild and repair the infrastructure and expand high-speed internet access to 98 percent of Americans.

HOLMES: And some of the things we're hearing from last night, the president taking on big oil. But has he backed up some of those claims with his actions? Also in the Republican response talking about health care reform adding to the deficit. We're trying to separate fact from fiction here.

CHETRY: That's right. With our Jim Acosta, in Washington. You know, a lot of people always say it's time to end the oil subsidy. This is ridiculous. They are making enough money on their own. But when rubber meets the road and politics, you know, comes in to play it's not as easy as it sounds.

JIM ACOSTA, CNN CORRESPONDENT: Not as easy as it sounds, and as we mentioned in the last hour, the facts were mostly all in order last night, just like the civility. Not only were the speeches pretty civil last night, guys, but they also got most of the facts right.

Still our fact checkers here at CNN threw a few penalty flags as we were going through the addresses last night. Let's start with President Obama. As you'll recall a big part of the State of the Union address was devoted to the president's call for a Sputnik moment with new investments in education, in innovation and infrastructure. As Mr. Obama was making the pitch for the country to switch to green energy, he made a statement that raised some fact- checking eyebrows.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We need to get behind this innovation and to help pay for it I'm asking Congress to eliminate the billions in taxpayer dollars we currently give to oil companies. I don't know if you've noticed, but they're doing just fine on their own.

(END VIDEO CLIP)

ACOSTA: Well, that's true. They are doing just fine on their own. But the president left out the fact that in 2005, as a senator, he voted for the Energy Policy Act that gives tax breaks to oil companies. So we rated that one inconsistent, guys.

HOLMES: All right. And let's move on to the two responses. We need to pick from one here. Let's go with the official GOP response. What were you hearing from Representative Paul Ryan?

ACOSTA: Well, T.J., as you mentioned, House Republican Paul Ryan delivered the official GOP response and as expected Congressman Ryan noted the deficit has gone up under President Obama, which is true. But Ryan connected the deficit issue to the president's health care law with this comment.

(BEGIN VIDEO CLIP)

REP. PAUL RYAN (R), WISCONSIN: Then the president and his party made matters even worse by creating a new open-ended health care entitlement.

(END VIDEO CLIP)

ACOSTA: Now, this is a big Republican talking point and it's false according to the official nonpartisan score keeper up on Capitol Hill, the Congressional Budget Office. The CBO says the health care law will produce a net reduction in federal deficits of $143 billion this decade. We should point out, though, that the Republicans strongly disagree with the CBO score on health care reform, as we've noted time and again but it's still worth pointing out when they say it, guys.

HOLMES: All right. Jim Acosta, we appreciate you keeping an eye on things for us this morning. Thanks so much.

CHETRY: Thanks, Jim.

ACOSTA: You got it.

CHETRY: So the State of the Union traditionally split along party lines and you know, you see the partisan standing ovations, the hands in the lap for the opposite party. Last night, though, it was a bit different, at least, the visuals. They called it date night in Washington. More than 60 congressmen and women embracing the bipartisan seating arrangement.

If you take a look at where people sat. Democrat Senator Charles Schumer and Republican Senator Tom Coburn very ideologically different but sitting together, laughing and joking last night. Senator Franken, newly elected Tea Party darling Marco Rubio and Senator Ben Nelson all sitting together. But minority whip Steny Hoyer spent the evening with his counterpart as well, he sat with majority whip Kevin McCarthy. So there you see it.

Meantime, not all the invitations were accepted. House minority leader Nancy Pelosi turned down majority leader Eric Cantor's request to sit next to him. Pelosi said she already had a date with Republican Congressman Roscoe Bartlett of Maryland. She was going to be sitting with him.

HOLMES: All right. Well, coming up, a story we told you about here yesterday morning. Some accusing Taco Bell of not using real beef. Taco Bell now defending the beef.

CHETRY: And another blast of winter weather coming into the northeast and New England. Could be looking at another foot of snow in some places, as if they haven't gotten enough already.

Jacqui Jeras tracking extreme weather for us, coming up.

(COMMERCIAL BREAK)

HOLMES: 40 minutes past the hour on this "American Morning." A couple of stories we're keeping a close eye on that includes Congresswoman Gabrielle Giffords. She is expected to leave intensive care this morning and head over now to rehab. Her condition has been upgraded to good, overnight, so we do expect her to officially be moved to the rehab center at some point this morning.

CHETRY: And Taco Bell is defending its meat. Yesterday we told you about the lawsuit accusing the fast food chain of using some kind of meat concoction with binders and fillers in the tacos instead of real beef as its advertising claims. Taco Bell now says it plans to take some kind of legal action against the people making those allegations. They say they start with 100 percent beef and then they simmer that beef in a variety of spices.

HOLMES: So it's beef.

CHETRY: They say they start with 100 percent beef.

HOLMES: Where does it end?

CHETRY: It ends in your beef Mexi-melt. It ends in your Gordita.

HOLMES: I'm having a Taco Bell today. This story made me hungry today.

Also, a story, remember December 25th, Christmas day 2009. You remember this picture, don't you? The so-called underwear bomber. We now know that he will go on trial on October the 4th. This is Umar Farouq Abdulmutallab, he is accused of trying to blow up that plane on Christmas day '09. He's pled not guilty but he's also acting as his own attorney even though he has another attorney on stand-by just in case he needs some help.

CHETRY: Also, Osama Bin Laden's former cook and bodyguard is going away for life. Ahmed Ghailani sentenced to life in prison yesterday. He was the first Guantanamo Bay detainee and maybe the last to be tried in civilian court. Ghailani was only convicted on one conspiracy church in the 1998 U.S. embassy bombings in Africa, the deadliest attack by Al Qaeda before 9/11,

HOLMES: And we just need to find a way to get your phone and your car together. Well, they think they figured this out. They're trying to hook these two things up. BMW and Ford as well as Mercedes are now coming up with a way that you can connect your iPhone or your Smartphone and control Pandora on your dashboard by plugging the phone into your car. They want to do this because hey, instead of trying to put all these complicated systems and things that are outdated in a matter of months into the car - those can be expensive - rather you're walking around with the internet and all the music you want anyway, let's just find a way to link these two things up. So they're just getting started with this new technology.

CHETRY: Sounds good. Sounds good.

Well, our Jason Carroll is going to be joining us in a couple of minutes. We were talking about reaction inside of the beltway. But what do people outside of the beltway think of the president's State of the Union last night and the GOP response? He's going to check in with some people enjoying breakfast at a New Jersey diner to get their take.

Also the Ohio Valley and the mid-Atlantic waking up a little bit snowy this morning. Jacqui Jeras with the travel forecast right after the break. 42 minutes past the hour.

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CHETRY: Well, his State of the Union message was all about winning the future. Today President Obama hits the road to sell it to the American people. And our Jason Carroll at a diner in North Bergen, New Jersey, this morning getting reaction to the president's speech along with the pancakes.

Hey there, Jason.

JASON CARROLL, CNN CORRESPONDENT: Yes, the pancakes exactly.

Well, first what I want to do is I want to show you where we are. We're at the Riverview Diner in North Bergen. And I want you to look at just how empty this place is. And the reason for that is because just a few years ago, they're telling me that at this hour it would have been packed in this diner. But because of the economy, there are just now, Kiran, two customers here. And that sort of is an example of what the people in this part of the United States are dealing with.

These two are Martina Muehr (ph) and Jerry Reynolds (ph). Both of you saw the president's speech last night. Both have strong opinions about what you heard. I'm going to start with you, Martina. You are a registered nurse.

Tell me what you liked and what you didn't like about the speech.

UNIDENTIFIED FEMALE: I'm glad he focused on the economy. I am not sure if his solution is going to work. I'm hoping and praying that it does. I am very tired of seeing people suffer, people not have work, people that are truly hard workers are suffering with their families. It's sad to see another plant closing or hear about another place closing down. You're saying that this place is empty. You'll see that a lot.

CARROLL: You've noticed it here too.

UNIDENTIFIED FEMALE: I have noticed it here, too. I've noticed it everywhere I go. And it's really a saddened situation. People need help. It's up to our government, I think, to do everything possible to help everybody. And I'm not so sure that we're grasping what we need to be doing.

CARROLL: Jerry, what are your thoughts about the president's speech last night?

UNIDENTIFIED MALE: I think he's just saying the same thing he did last year. He says he wants to spend more money. We have this big deficit and it's just the same thing every year.

CARROLL: OK, and very quickly.

What did he not say that you wanted him to say?

UNIDENTIFIED MALE: Well, I think we get -- the tax is 25 percent for China goods coming in. It's 2.5 percent going there. It's not fair.

CARROLL: OK. All right. Just a start here.

Again, Kiran, T.J., I know you guys are watching here. But when we walked in, I mean, and we saw this empty diner and spoke to the people here about where are all the people? They said, they went with the economy. So just trying to get some opinions here throughout the morning in terms of what they heard last night.

We'll be getting more later on in the day. Back to you.

CHETRY: All right. Hope if fills up a little bit more for them. It's a little depressing out there this morning, Jason.

All right. Thank you.

(WEATHER REPORT)

CHETRY: Ahead on AMERICAN MORNING, riding a monster wave. You saw the pictures. Now we're going to hear the story of what it's like to be there. Look at this wave. One surfer hurt because of it. A lot of risk and a lot of reward. And we're going to hear from somebody who was there.

HOLMES: Also, who says nobody's hiring? Google is. We'll tell you just how many jobs they are trying to fill. It's 49 minutes past the hour.

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HOLMES: Well, we're about seven minutes until the top of the hour.

Today is day one of the World Economic Forum taking place in Davos, Switzerland. It's a great location. Look at that. A beautiful spot to have a conference. You've got CEOs, world leaders and economists. But they are dealing with a harsh reality of this global economy right now.

CHETRY: They sure are. And our chief medical correspondent Dr. Sanjay Gupta is there.

Actually, not that surprising as we talk about the growing cost of health care and we talk about how this is going to be a huge issue, not just for the U.S. but the world.

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: There's no question. And I think a lot of people might find is surprising that a doctor is here at Davos, this World Economic Forum. But you're absolutely right. If you talk about health care costs and the strain they put on economies, both in individual countries and now around the world, it's pretty staggering.

Here, what I would say is this particular forum is focused on, obviously, addressing those problems with specific solutions. So, for example, one of the panels that I was moderating today had to do with this idea of personalized medicine. We use a shotgun approach at many medical problems. You have cancer, it's chemotherapy, you have a specific type, you have an infection, it's a particular antibiotics. But Every infection and every cancer is different in some way. So if you can target those things specifically, you have a much better chance of success.

And also predicting who's going to get specific diseases. So, you know, chronic disease around the world account for 80 percent of all deaths due to medical problems. Not infectious diseases anymore, but chronic medical problems. So, you know, these are some of the issues that are being addressed and some of the solutions, as well.

CHETRY: You know, and really timely. There's a story that came out saying that the cost of heart disease is going to triple over the next 20 years. And that this is going -- it's already, as we know, the number one killer.

What are you hearing about the discussions about prevention and solutions to try to stop this?

GUPTA: Yes. I mean, a lot of people talking about that specifically. I think over $800 billion is expected to cost by the year 2030, heart disease.

Look, you know, a lot of the focus is specifically on prevention. And by the way, we think of cardiac disease being the biggest killer in the United States. But we are essentially seeing that same problem now in the developing world. Heart disease, cancer, diabetes, stroke, those being the biggest killers in the developing world, as well. So a lot of attention on this. I think, you know, this idea of preventing some of these problems before they ever occur is a lot of what the focus is.

And if you think about Davos as sort of an informal, unofficial gathering of people where, you know, it's off the record for the most part. Food industry executives can talk to government regulator and say, look, we don't want to be regulated but, in exchange, we're going to cut back on the amount of fat, the amount of sugar, the amount of sodium in our foods. You have drug companies sort of doing the same thing.

So you get these conversations that hopefully can lead to some solutions or some agreements later on down the road.

CHETRY: All right. Sanjay, very interesting. And, you know, a lot of big issues to tackle in Davos.

Thanks so much.

HOLMES: Well, we are getting close to the top of the hour. Your top stories coming your way in just about 90 seconds.

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