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American Morning

Man Arrested for Plotting Terrorist Activities in New York City; Congressional Super Committee Unlikely to Produce Deficit Cutting Compromise; GOP Debate on National Security; Jon Huntsman on SNL; NYC Pipe Bomb Plot Foiled; U.K. Hacking Hearing; Peaceful Protesters Pepper Sprayed; Reno Wildfires 80 Percent Contained; Two Runners Die at Philadelphia Marathon; University of Miami Self-Imposes Bowl Ban; Tiger Clinches Presidents Cup for U.S.; Beckham, Galaxy Win MLS Cup; First Lady Booed at NASCAR Race; Gingrich Tops GOP Poll; Gingrich Tops GOP Polls; Avoiding Costly Gift-Giving Mistakes

Aired November 21, 2011 - 06:59   ET



CAROL COSTELLO, CNN ANCHOR: He's accused of building homemade bombs and planning to plant them in police cars. New York City saying it stopped a terrorist in his tracks days before the holiday season begins.

ALINA CHO, CNN ANCHOR: On the brink of failure. Congress already in damage control mode with the so-called Super Committee getting ready to announce that it can't make a deal.

COSTELLO: And his campaign was declared DOA last summer. Now, Newt Gingrich is surging in the polls. CNN goes in-depth on the candidate with a former colleague.

CHO: And holiday buyers beware. Are gift cards a good buy? Are store credit cards a good idea? We have five ways to outsmart the stores in holiday shopping season on this AMERICAN MORNING.


COSTELLO: And good morning to you. It is Monday, November 21st. Happy Monday. Ali and Christine have the day off.

CHO: Counting down to Friday.

COSTELLO: Thanksgiving is Thursday. Friday is the day when you just lay around and you feel you're going to explode.

CHO: After we do the show. Right?


Welcome to AMERICAN MORNING. I'm Carol Costello along with Alina Cho.

CHO: Good morning, and good morning to you. Up first, new details in a plot to plant pipe bombs in and around New York City. Twenty-seven-year-old Jose Pimentel behind bars this morning. He was arraigned and denied bail just hours ago.

Authorities say he was an Al Qaeda sympathizer and a Muslim convert who plotted to bomb NYPD patrol car, post offices, and returning U.S. troops, and he was doing much more than just talking about it. Our Deb Feyerick is here with the latest. Hey Deb, good morning to you.

DEBORAH FEYERICK, CNN CORRESPONDENT: Well, this is a suspect who actually hit the NYPD's radar about two--and-a-half years ago. He had already become radicalized and his views on Islam apparently so extreme that police say it even made like-minded friends nervous.

Now Pimentel Allegedly talking about traveling to Yemen and changing his name to Osama Hussein after his heroes Osama bin Laden and Iraqi dictator Saddam Hussein. New York's top cop says Pimentel was making as many as three devices, three pipe bombs using easy-to- buy materials including elbow piping, Christmas lights, and matches. And this weekend authorities say he started drilling holes in those pipes, which according to Al Qaeda instructions, is the last mechanical step in building the bomb.


MAYOR MICHAEL BLOOMBERG, (I) NEW YORK: The suspect was a so- called lone wolf motivated by his own resentment of the presence of American troops in Iraq and Afghanistan as well as inspired Al Qaeda propaganda. He was not part of a larger conspiracy emanating from abroad. He represents exactly the kind of threat FBI Director Robert Mueller and his experts have warned about.


FEYERICK: Now, the FBI and other agencies were not involved and large will you unaware of this two-year long investigation even though the alleged target did include U.S. service personnel. Before Pimentel was arrested, NYPD bomb-makers actually built and detonated a similar device inside this car. You can take a look at it right there. This assumed that Pimentel's device would have worked. A counterterrorism expert tells me that had they been done properly, had they didn't built in placed in the right location, they could have killed upwards of a dozen people depending on how they were situated.

Pimentel has pleaded not guilty. It appears that the death of U.S. born radical cleric Anwar al Awlaki in a joint strike in September really accelerated this alleged plot, taking it from aspirational to operational.

CHO: Wow. All right, Deb Feyerick, thank you very much.

COSTELLO: We want to talk a little more about this with Fran Townsend. She's our CNN National Security Contributor and former security advisers to President Bush. Welcome, Fran.


COSTELLO: So Peter Bergen, our expert on Al Qaeda, says if this guy is the best Al Qaeda has to offer, we shouldn't worry. Do you agree?

TOWNSEND: The problem is we can say that in the media. I can remember being responsible for preventing these thing. And of course what you say to yourself is one idiot just has to get lucky.

And so, look, this was a long investigation, two years with an informant. I'm a little troubled by the fact the Feds, the FBI was not involved. After all, this was a targeting of U.S. service members and others. He was inspired by Anwar al Awlaki, the now deceased inspirational leader of Al Qaeda in the Arabian Peninsula. And so the feds may have been able to help here. That said, they had a successful arrest and we'll see what we learn from it.

COSTELLO: So why do you suppose the feds were not more involved?

TOWNSEND: Carol, look, as you well know, as our viewers know, the FBI and local police departments are often very competitive. We don't know very much about the informant who was involved, what the basis of investigation and the involvement of the informant was. There are a lot of reasons and guide lives the FBI follows that are different for the NYPD. Whether they were just not told about it or whether they had some objection to the way the investigation was handled, we have yet to learn that.

COSTELLO: And he'll be tried, as we understand it, in state courts. He's not going to be tried on a federal level because, of course, he's not charged with a federal crime.

TOWNSEND: That's right. Now, the federal governor could come in. If they believe they have the basis for federal charges they could come in and try to take the case. I think that's unlikely given they didn't involve themselves at the press conference, neither the FBI or Justice Department. But it's possible. We'll have to see how this plays out.

COSTELLO: The other interesting thing going back to the suspects himself and this news conference held by the New York City mayor, Michael Bloomberg, I've not seen many news conferences where investigators demonstrated what could have happened if this guy could have manufactured these pipe bombs. Did you find that unusual?

TOWNSEND: I do. I can remember during -- you'll recall, Carol, the liquid bomb plot several years ago. We did such an experiment, but we didn't show those tapes publicly. And we also know from the Times Square bomber who put the bomb together incorrectly, thank god, that they often don't put these things together. The Christmas Day bomber didn't successfully detonate his bomb either. And so it's interesting they would have shown how it would have been if successful. Often, as we know, though don't put them together successfully.

COSTELLO: The thought crossed my mind they were just trying to demonstrate how dangerous he could be because he's inspired by Al Qaeda. He never had any direct linked to Al Qaeda, inspired by death of al Awlaki, right, and he also learned how to build the bomb from an Al Qaeda-inspired magazine called "Inspire." And the article was "How to make a bomb in the kitchen of your mom."

TOWNSEND: Carol, the interesting thing here is as the U.S. government has been successful against Al Qaeda's leadership and people like Anwar al Awlaki, their message lives on on the Internet, these bomb-making material. Al Awlaki had hundreds of thousands of audio and videotapes disseminated around the world. So even though he's dead, we're seeing these tapes and websites continue to recruit, inspire and train individuals who are sort of want to be affiliated with them.

COSTELLO: Fran Townsend, thanks for joining us. Appreciate it.

CHO: Two University of California Davis police officers are on administrative leave after this video you're about to see surfaced of the cops casually pepper spraying peaceful Occupy protesters right in their faces and point-blank range. It happened on Friday night. The university says the officers were trying to clear out the Occupy camp and felt trapped by protesters. The U.C. Davis police chief says it was one officer's decision to unload.


UNIDENTIFIED FEMALE: This was a decision made from with that group, from within, by the officer who was in charge. I see pepper spray as a tool for officers to use, and like any other tool that we carry and we utilize, you hope and pray that it's used correctly and withkin policy.


CHO: And 11 people required treatment. Two were hospitalized. Hundreds of protestors came out calling on the school's chancellor to resign.

Now to politic, and it turns out failure was an option for the deficit cutting super committee charged with trimming more than $1 trillion in debt. Unable to compromise, the bipartisan committee is now focused on putting a positive spin on the failure. They'll come out with an announcement.

COSTELLO: CNN Congressional correspondent Kate Bolduan is following the development. She's live in Washington for us. So Kate, what went wrong?

KATE BOLDUAN, CNN CONGRESSIONAL CORRESPONDENT: It seems that the big issues that have held off pulling of deficit reduction measures in the past are the same obstacles hitting this committee, and they couldn't overcome it. Barring an 11th hour breakthrough, the super committee is headed for failure today as talks have fallen apart and lawmakers have gone from negotiating to simply finger-pointing and kind of lining up for who should be to blame if and when the committee fails.

If the committee can't pull it off, and we'll see if we'll get an announcement on that today, automatic and painful cuts will kick in to achieve the required minimum savings of $1.2 trillion. This was included in the summer's debt deal to motivate the committee to succeed.

Among the areas that are impacted, defense would be hit, many say the worst suffering about half of the cuts. Medicare impacted, education and transportation, to name a few. Some areas, especially those that help low-income Americans, Social Security, Medicaid, food stamp programs and veterans benefits are among them.

There is already quite a bit of talk about overturning this trigger or working a way to carve out the cuts to the defense budget, which defense -- the defense secretary said would be catastrophic. But lawmakers, including the president, saying that it would be shirking the responsibilities of Congress. These were put in place to be painful to avoid this committee doing just what they're probably likely about to announce today, which is not reach agreement.

CHO: We all know how that works.

BOLDUAN: Exactly. One thing I should point out, though, they will have a year to battle this out as these cuts, while automatic and immediate, they called them, don't set in until 2013.

COSTELLO: All right, Kate Bolduan, thank you very much.

And coming up at 8:30 Eastern, we'll talk with two key members of the debt super committee, Arizona Republican Senator Jon Kyl and Massachusetts Democratic Senator John Kerry.

CHO: How do you put a positive spin on failure?

COSTELLO: It's hard to do that.

CHO: We'll ask the senators.


CHO: Exactly. It's 10 minutes past the hour here. So what's new this morning? The Obama administration plans to announce new sanctions against Iran later today. With U.S. companies already banned from doing business with the Iranians, diplomatic sources telling CNN the new sanctions are intended to stop foreign countries from conducting business with Iran's oil and gas industry. And any foreign nation that does will be banned from doing business in U.S. markets.

Egypt erupting again this morning, protesters filling Cairo's Tahrir Square for a third straight day. Twenty people killed in brutal clashes over the weekend. Many were brutally beaten. Military rules say elections will go on as planned in seven days.

Britain's phone hacking scandal entering a new phase this week. The government's opened an inquiry to illegal eavesdropping and bribery by journalists. Among the celebrity witnesses will be actor Hugh Grant who claims his phone was hacked by the now defunct "News of the World" tabloid.

COSTELLO: Still to come this morning, a preview of the big GOP debate moderated by our friend Wolf Blitzer. Chief Political Correspondent Candy Crowley will be along to tell us why tomorrow's topic could make this a make or break night for the candidates.

CHO: Speaking of the candidates, Jon Huntsman making a cameo this weekend on "Saturday Night Live." Why he can't finish a sentence these days without the words "New Hampshire."

COSTELLO: And actress Mila Kunis makes a YouTube dream come true. We'll have details coming up. She didn't wear that dress.

You're watching AMERICAN MORNING. It's 12 minutes after the hour.


COSTELLO: Welcome back to AMERICAN MORNING. The Republican presidential hopefuls gather in Washington tomorrow night for another debate. This one will focus on national security.

CHO: And if history is any indication, it's a topic that could help a candidate clinch the nomination.

Here's CNN chief political correspondent Candy Crowley.


CANDY CROWLEY, CNN CHIEF POLITICAL CORRESPONDENT: Whenever anybody asks me, like, why is it important, why is a foreign policy debate important, I would direct them to George Bush, the son. Elected in 2000. His entire agenda was about fixing education, helping the economy. He had a very domestic agenda.

And then came 9/11 and became a foreign policy president. It really mattered what he knew, who he knew, who he had around him, what sort of people did he pick. It was -- it was important to George Bush at that time so much so that Condoleezza Rice, who had worked in his dad's administration, was brought onboard during the campaign to take George Bush in his down times and talk to him about various countries and various leaders.

You can say all you want, but this is an election that's going to be decided on the U.S. economy. Maybe you're right, but the fact of the matter is, even the U.S. economy is somehow impacted by what's going on in Greece, by what may go on in Italy, by what's going on in Spain, all across Europe.

So the fact of the matter is, it's really the global dealings that we talked about for so long. So it's important that these presidents, these potential presidents, show their stuff.


CHO: All right, Candy -- and keep it here tomorrow night at 8:00 Eastern on CNN as the Republican candidates for president gather just steps from the White House for a debate on national security and the economy. It's co-sponsored by the Heritage Foundation and the American Enterprise Institute and moderated by our very own Wolf Blitzer. That's 8:00 Eastern tomorrow night right here on CNN.

COSTELLO: Jon Huntsman has a plan and he's not about to waver from it now. Win New Hampshire. Huntsman's been campaigning almost exclusively in the Granite State. But over the weekend, the former Utah governor who's badly losing in the polls, he took a break. He headed for the Big Apple for a cameo on "Saturday Night Live" and he still had New Hampshire on his mind.


SETH MEYERS, COMEDIAN, "SATURDAY NIGHT LIVE": You seem to be putting all of your eggs in one basket, New Hampshire. Are you worried you might alienate the rest of the country?

JON HUNTSMAN (R) PRESIDENTIAL CANDIDATE: Seth, I love all of America. From Dallas, Texas, to Manchester, New Hampshire. From the majestic Rocky Mountains, to the Hampshire's scenic Lake Winnipesauke, from the innovation of Silicon Valley to the affordable outlet malls in North Conway, New Hampshire.

MEYERS: I can't help but notice you keep mentioning places from New Hampshire.

HUNTSMAN: Well, it's not on purpose, Seth. I would never tie myself to one state. I like to spread my wings and fly like the purple finch.

MEYERS: Which is, of course, the state bird of New Hampshire?

HUNTSMAN: You know a lot about New Hampshire, Seth.

MEYERS: I'm from New Hampshire.

HUNTSMAN: Well, that makes sense, because you're kind and good- looking, classic New Hampshire.

MEYERS: Jon Huntsman is a proud New Hampshiren, and I can tell you that we do not fall for easy compliments.

HUNTSMAN: That's because you're wise like a Dartmouth professor.

MEYERS: All right. Well, thank you so much for coming.

HUNTSMAN: Are your parents registered voters?

MEYERS: My mom's a Democrat and my father's an independent.

HUNTSMAN: Say hi to your dad for me.

MEYERS: All right.


COSTELLO: Tune in to CNN at 6:00 P.M. Eastern tonight, Jon Huntsman will sit down live with our own John King for a preview of tomorrow night's Republican debate and I bet they'll be talking about, I wonder how the weather is in New Hampshire?

CHO: Exactly. All right. Let's talk a little bit more about the weather. Because it's a big travel week, we'll be right here on this set living here for the entire week, but Bonnie Schneider, tell us what the weather will be like for all of the people who are heading to grandmother's house.

BONNIE SCHNEIDER, AMS METEOROLOGIST: Well, it's definitely wet out there. And just south of New Hampshire, Massachusetts, we're looking at rain. A lot of this rain has been sliding across New York City most of the morning, kind of flipping Long Island at this hour. You'll also see some rain further south towards New Jersey and to Delaware and Maryland.

But, unfortunately, that wet weather will continue on and off throughout the day. It's much heavier in terms of downpours for Memphis. Very stormy there as well as a little rough further off to the west and you can see some rain sliding into Nashville at this hour. So if you're driving anywhere in Arkansas or Tennessee, you're probably going to face wet weather.

Further off to the south and west in Dallas, Texas, the risk continues for severe storms. Now these could be very powerful throughout the afternoon. So make sure you have your NOAA weather radio on and be listening for any severe thunderstorm watches or warnings that are posted for your area.

To the north, it's very, very cold and chilly. How cold? Well, in Minnesota, it was cold enough for snow. Let's show you some pictures, kind of an early start to winter. A lot of people get snow this time of year. Minnesota, it's not uncommon, which you can see several inches of snow, cause a lot of traffic problems and people have to take it slow on the roads. That's what's to come for much of the country that hasn't experienced it yet as we get into the colder temperatures.

For those of you that are getting a head start on Thanksgiving holiday travel, unfortunately today doesn't look like the best day, because we have a lot of delays anticipated. None right now but we're looking for them as you saw the rain moving through New York. Well, there will be some fog and low clouds throughout much of the day there in the northeast.

So delays there also in Atlanta, Washington, D.C., Dallas, due to the storms I mentioned, and it's raining right now in Memphis. So if you're driving, please give yourself extra time to get were where you're going on I-40, for example. Seattle, rain and winds and we're also looking at the threat for delays in San Francisco due to early morning fog. So a lot of delays expected for today and much of what you see here will be pushing eastward for tomorrow and as we get closer to Thanksgiving.

So we'll be monitoring all the delays here right here on CNN. We have lots of exciting things happening as we're going to be covering travel for you on this busy holiday week -- Alina, Carol.

CHO: Yes.

COSTELLO: It's exciting.

CHO: It's the biggest breaking news event.

COSTELLO: Bonnie Schneider -- it is -- it's exciting. There's not going to be rain on Thanksgiving, but it could make things more exciting and you're driving not exactly the right way.

CHO: Actress Mila Kunis, you know, she attended -- she made good on a promise. She attended the Marine Corps Ball in Greeneville, North Carolina, this weekend. She made that YouTube wish come true and her date was Sergeant Scott Moore. Like a happy couple there. You'll remember that he posted a YouTube invitation back in July while he was stationed in Afghanistan. And Justin Timberlake did the same.

COSTELLO: Sergeant Moore looked a little nervous in those pictures.

CHO: Do you think so?

COSTELLO: I'd be nervous.

CHO: Still to come this morning, tabloid journalism on trial in Britain as victims of phone hacking tell their stories.

COSTELLO: And what's expected to be the most popular holiday gift in America this season? Not that everyone uses them. We're "Minding Your Business," next.


COSTELLO: Twenty-five minutes past the hour. Welcome back. "Minding Your Business" this morning.

U.S. stock futures pointing to a lower open right now. Last week, the Dow dropped nearly three percent and the NASDAQ and S&P 500 fell about four percent driving markets down worldwide overnight fears about U.S. budget talks as well as the debt crisis in Europe.

Spain has a brand new leader. Mariano Rajoy won 45 percent of the popular vote this weekend. Topping his agenda -- preventing the debt problem in Greece and Italy from spreading to Spain. In recent days, concerns about Spain's economy have pushed bond yields closer to that key seven percent level at which other countries were forced to seek an international bailout.

And Warren Buffett speaking about Europe. On his trip to Japan today, he says the euro system is just not working and it's going to take more than just words to fix it. Buffett is in Northern Japan looking at some potential investments there after his trip was rescheduled from March due to the tsunami and earthquake.

Chevron is taking responsibility for an oil spill in Brazil and is pledging to clean it up. It happened off the coast of Rio de Janeiro earlier this month and it's one of the largest spills to hit Brazil's offshore oil industry. The leak has since been plugged.

Sending your packages will soon cost you more. U.P.S. announcing that it's boosting its base rates for ground and air shipments 5.9 percent. International shipping rates are jumping almost seven percent. The company blames demand and its investments in new technologies are on the increase. The new rates begin after Christmas on January 2nd.

And gift cards will be the most popular present again this year. A survey by the National Retail Federation says 80 percent of you will be buying a gift card for someone this holiday season. But "Consumer Reports" says a quarter of people don't even use them. We'll have more on that coming up later this hour.

And don't forget, for the very latest news about your money, check out the all-new

AMERICAN MORNING will be back after a break.


CHO (voice-over): Turning the tables on the British tabloids, celebrities get a rare chance to confront their tormentors at a hearing on media ethics on this AMERICAN MORNING.

COSTELLO (on camera): And welcome back to AMERICAN MORNING. It's 30 minutes past the hour. Your top stories now. A suspect arrested in a New York City pipe bomb plot. The 27-year-old Jose Pimentel is behind bars this morning. He was arraigned and denied bail just hours ago.

Mayor Michael Bloomberg last night announcing an alleged terror plot involving the al Qaeda sympathizer who planned to target the NYPD and returning U.S. soldiers with homemade pipe bombs.

CHO: Deadly pre-election violence in Egypt. Protesters filling Cairo's Tahrir Square for a third straight day. Twenty people were killed in brutal clashes over the weekend, many were beaten. Demonstrators saying the new military rulers have to go.

COSTELLO: The so-called congressional "Super Committee" is apparently far from it. You're looking at a live picture from Capitol Hill.

Members of the bipartisan committee are now blaming one another as they prepare to formally announce their failure to come up way deal to cut $1.2 trillion from the deficit by this Wednesday's deadline.

CHO: Britain's stone hacking scandal entering a new phase this morning at a government-backed hearing. Witnesses including actor, Hugh Grant are getting a rare chance to turn the tables on the tabloids.

CNN's Atika Shubert is covering this for us. She is live in London. Atika, good morning. ATIKA SHUBERT, CNN CORRESPONDENT: Good morning, Carol. We've already have heard from a number of people who have been witnesses. We're still waiting to hear from Hugh Grant and other celebrities, of course.

We've also heard from a lawyer, a journalist and most importantly from the family of Milly Dowler. You might remember a few years ago, Milly Dowler went missing in the U.K. Her parents, Bob and Sally Dowler, were frantically searching for her, but they were also mobbed by the press.

They described how they couldn't even open the door without the press hounding them, popping up when they were just trying to take out the garage and then perhaps most damaging of all, hacking into their daughter's voicemail messages and deleting some of those messages to listen in on to more voicemails.

And this unimportantly led to the false hope by Sally Dowler that her daughter was still alive. We now know of her, of course, that Milly Dowler was abducted and murdered. But this has become a prime example of the damage done by some of the tabloid press here specifically on phone hacking.

But this inquiry will also be looking at other illegal methods of gaining information, such as the surveillance that they have done, such as cyber crimes, malware, all kinds of things will be looked at.

CHO: All right. Atika Shubert, thank you very much.

COSTELLO: Two University of California-Davis police officers are on administrative leave this morning after this video surfaced of cops casually pepper spraying peaceful "Occupy" protesters. The pepper spray went in their faces at point-blank range.

This all happened Friday night. The university says the officers were trying to clear out the "Occupy" camp, but they felt trapped by these protesters.

The UC-Davis police chief says it was one officer's decision to unload the pepper spray, just his. Eleven people required treatment. Two ended up in the hospital.

CHO: Fire fighters appear to be making process battling the Reno, Nevada, wildfires this weekend. Officials say the blaze is now 80 percent contained.

Since it began on Thursday, dozens of homes have either been damaged or destroyed. But officials say the fires are no longer a major threat to other buildings. No word yet on exactly what caused it

COSTELLO: Tragedy at the Philadelphia marathon. Officials say two runners collapsed and died during Sunday's big race from what appears to be heart attacks. One man collapsed right before the finish line and the other about a quarter mile before the end of the race. CHO: In Miami, hurricanes won't be at a Bowl game this year. The University of Miami announced a self-imposed ban yesterday. The school is still under investigation by the NCAA over allegations that a former booster and convicted Ponzi schemer gave cash, jewelry and even prostitutes to players. The team plays its last game on Friday.

COSTELLO: Let the debate begin. Is he back? Tiger Woods clinching the President's Cup for the United States in Melbourne, Australia. He defeated Aaron Baddeley to score the winning point for the Americans. It's the second time Tiger has clinched the cup for the U.S.

CHO: Wow. What could be his last game on U.S. soil, David Beckham, the champ. The L.A. Galaxy won the MLS Cup last night beating the Houston Dynamo 1-0. Beckham and Landon Donovan, also a cutie of World Cup fame, teamed up to win the cup.

Beckham shocked the soccer world way back when in 2007 when he came to the U.S. to compete here. His five-year deal expires next month. Something tells me that will be just fine.

COSTELLO: I wonder if he'll go home, though?

CHO: I don't know.

COSTELLO: Will Posh still live here?

CHO: They've made -- Victoria Beckham, they have made a home in Los Angeles and their kids apparently are happy. We'll have to wait and see.

COSTELLO: I'm sure they'll be following it very closely.

The first lady and Dr. Jill Biden, well, they faced a very tough crowd in NASCAR. Let's put it that way.


UNIDENTIFIED MALE: And now, please welcome our Grand Marshals, Sergeant Andrew Berry and family, first lady of the United States, Michelle Obama and Dr. Jill Biden, as they deliver the most famous words in motorsports.


COSTELLO: You heard the boos there. Michelle Obama and Jill Biden were apparently greeted with those boos by NASCAR fans at the Ford 400. They were the grand marshals of the season's last race.

And also there to bring awareness to the first lady's joining forces program. That's an initiative to hire and train veterans. In the mean time, Tony Stewart took home the sprint cup title, no boos for him, his first win since 2005.

CHO: And up next on AMERICAN MORNING, Newt Gingrich. He's been shocking himself by surging to the top of the GOP polls. We are going in-depth today with two men who worked side-by-side with the former House speaker to see why this is happening and whether it can last. It's 36 minutes after the hour.


CHO: Good morning. Washington, D.C. take a look at the nation's capitol. A live look there. It is cloudy and 56 degrees and showers later with a high of 57. Rain up and down the east coast.

Welcome back to AMERICAN MORNING. It's a scenario no one could have imagined just a couple of months ago, but Newt Gingrich is emerging as a front-runner for the Republican nomination. Take a look at the latest CNN/ORC poll.

The former House speaker pulling into a virtual tie with Mitt Romney making up 14 points just since October. He's now trailing the former Massachusetts governor by just two points. That's well with the margin of error.

So how is Gingrich managing to pull this off? We want to go in-depth now. Joining us live from Washington this morning, Martin Frost, he's a former Democratic congressman from Texas and Rick Tyler, a former Gingrich spokesman who work on the candidate's campaign earlier this year.

Gentlemen, thank you for joining us. Rick, I want to begin with you. You were part of the very well publicized staff exodus back in June. You and 15 others quit in protest. You didn't agree with his campaign strategy then. Wrap do you think he's doing right now?

RICK TYLER, FORMER GINGRICH SPOKESMAN: Well, I think Newt's benefited from a series of second looks, if you will. You know, we always want to find the perfect candidate and we often look to people we have not known very well, and so we had the rise and fall of a lot of candidates.

This is really an expectations game. I think in a sense, Newt is inoculated now from this expectations game. I think he solidified himself as the not-Romney candidate and he has benefited enormously from these benefits.

They have highlighted, his experience and what often people criticize him about, but he stayed -- well, against because he's often been criticized for not being focused, but here he's just been so focused on what he wants to talk about in these debates, and it's really served him well.

CHO: Has it surprised you?

TYLER: I think it has surprised me. You know, in politics and even people who cover politics, we lose our perspective from time to time. When we had an avalanche fall on us, I took the short field and thought we were dead.

Newt I should have known, took the long view, dug himself out and re-ascending the mountains. So that -- I shouldn't have been surprised, but you know, I've had a lot of time to reflect on things. I see things much clearly now and I'm very happy for the speaker.

CHO: Well put. You know, Martin I want to talk to you for a moment, because were you part of the same freshmen congressional class back in 1978 as Newt Gingrich. I'd like to know your thoughts about a very young Newt Gingrich and whether you saw early on that there was a future leader there in the works?

MARTIN FROST, FORMER DEMOCRATIC CONGRESSMAN FROM TEXAS: Well, no one knew very much about Newt when he was first elected in '78. We both were about the same age. We both were relatively unknown when we came to Congress. It took a while for newt to catch on.

Remember, he was elected in '78 and he didn't become speaker until '94. He became Whip a couple years before that. He basically took advantage of the fact that Democrats had gotten lazy. They've been in power for 40 years. He was able to put together and insurgency and he won.

He did it in a very smart way. The problem with Gingrich is that he'll go along and he'll be very good, say, for 50 minutes out of an hour and the last 10 minutes of the hour, he'll go wildly off message. That's what happened to him once he became speaker.

He had problems. He got in trouble when he went head-to-head with Bill Clinton. Bill Clinton outflanked him on closing the government, made him look pretty foolish. And then in 1998, in the closing days of the campaign, he ignored everybody's advice and decided to go out solely on the impeachment issue and the Republicans wound up losing five seats.

I was chairman that year and Gingrich had to resign. He was about to be overthrown by his own people. So he's a very smart guy, but he's not at all perfect and he really benefits from a very weak field right now, because Cain, Perry, Bachmann, they don't have substance.

Newt is a guy of substance, but Romney is still the frontrunner. I think he's going to have a hard time beating Romney, but he's the only credible person to go against Romney right now and it would be kind of an interesting race to watch.

CHO: Well, you talk about how it took him a while to get there, so to speak. It wasn't until 1994 that he was, of course, famously the architect of that contract with America and then went on to become speaker of the House.

Now having said that, Rick, you know, a lot of Democratic strategists are sort of salivating at the idea of a Gingrich nomination. They say that he comes with a lot of baggage.

You know, the well publicized affair, three marriages, ethics violation including these two latest headlines that Freddie Mac paid him more than a million dollars in consulting fees.

And that his think tank received $37 million from health care providers. I'm just curious, if were you still advising him as a spokesman what would you tell him right now on how to deal with that?

TYLER: Well, I think he is dealing with that. Notice you linked two things together. You talk about an ethics scandal. There was an ethics scandal. The IRS, the Ethics Committee and a federal judge all found that Newt did nothing wrong concerning the 1984 speech ethics charges filed against him.

Then you linked that with Freddie Mac and Fannie Mae as if Newt making money as a consultant, which is highly valued as somehow scandalous. It's not. So I would advise him to go out and tell the truth about it.

There's nothing wrong with a very successful Newt Gingrich who a had a series of clients including one that was Freddie Mac and having a center for health (INAUDIBLE), which by the way, was focused on free market health care as an alternative to Obama care.

I don't know a lot of politicians who want to take on, and even former politicians, who want to take on large-scale change. Remember Gingrich who is the one reformed welfare. He's the one who balanced the budget for four years. He's the one that all well cutting taxes.

So if you want -- people should look at Newt in terms of, if you're looking at things very large and hard to do in Washington -- and Martin knows how hard things are to do in Washington -- Newt Gingrich has been willing to take on these big challenges. and we have big challenges. We're now $15 trillion in debt. This health are system that we currently passed into law is not going to work. And so --


MARTIN FROST, FORMER DEMOCRATIC TEXAS CONGRESSMAN: If I could, just let me add one thing. Newt's real problem is he tends to get caught up in his own rhetoric from time to time. He tries to be too cute. This happened this spring when he accused Paul Ryan of right- wing social engineering for his budget plan and then he had to back track. He had to say, no, no, I didn't really mean that.

I've followed Newt closely over the years. And there's an interesting area that hasn't gotten a lot of attention yet. Newt gets lost on the subject of immigration. I will be very interested if he gets pressed and that issue soon. On one hand, he'll be for some sort of earned legalization, amnesty and then that will become unpopular. And he'll move off that subject. Newt is a work in progress.


He's a 68-year-old work in progress. And it will be interesting to follow him. And he is -- he's smarter and he knows more than most of the people in this race, except Romney. Romney, I think, comes off -- will come off well against Newt. The question is, can Newt sustain this now that he's suddenly risen to the top? This is such a crazy year. It's a weak field on the anti-Romney side. So he probably can sustain it. But we'll see once he has to go head-to-head way real candidate how he does. CHO: Rick, I have to ask you, and remind people, you were among the 16 people to quit in protest back in June. Given what you're seeing now with Gingrich surging in the polls, would you consider rejoining the campaign?

TYLER: I wouldn't rule it out. I have no plans to join the campaign. I wouldn't rule it out. I -- I --

CHO: If he asked, would you rejoin?

TYLER: I -- I -- let's leave that for a future date. I don't -- you know --


CHO: All right. Is that a yes? All right.


Thank you so much, Martin Frost, Rick Tyler. We appreciate your thoughts.

FROST: Thank you.

TYLER: Thanks.

CHO: Be with us tomorrow night, 8:00 p.m. eastern on CNN as the Republican candidates for president gather just steps from the White House for a debate on national security and the economy, co-sponsored by the Heritage Foundation and the American Enterprise Institute, and moderated by Wolf Blitzer, 8:00 p.m. eastern tomorrow night right here on CNN.

Morning headlines coming your way next.

Plus, holiday shoppers beware. Coming up, we'll reveal the most common and costly mistakes you make when you buy your loved ones gifts.

It's 47 minutes past the hour.


COSTELLO: It is 10 minutes until the top of the hour. Here are your morning headlines.

And it's the latest example how Washington gridlock. Democrats and Republicans on the debt super committee could not agree on a plan to cut $1.2 trillion from the budget. Now it appears they're working on the best way to publicly to say, hey, we failed.

After a dreadful week on Wall Street, it looks like more of the same for investors this morning. Dow, NASDAQ and S&P futures all down sharply right now. That means we are poised for a sell-off at the opening bell. A suspect arrested in a New York City pipe bomb plot. Mayor Michael Bloomberg last night announcing an alleged terror plot involving an al Qaeda sympathizer who planned to target the NYPD and returning U.S. soldiers.

Brand new this hour, CNN confirming the University of California, Davis police chief has been placed on administrative live. That's after this video surfaced of cops pepper spraying peaceful Occupy protesters. Two officers also taken off the job.

A special panel investigating the Penn State sex abuse allegations will speak today. The panel was established six days after ex-coach, Jerry Sandusky, was arrested for allegedly abusing as many as eight little boys.

Classes will be canceled for two hours this afternoon at Oklahoma State University. They will be holding a memorial service for women's basketball coaches, Kurt Budke and Miranda Serna. Both were killed in plane crash last week as they were heading home from a recruiting trip in Arkansas.

First Lady Michelle Obama and Dr. Jill Biden were greeted by boos by NASCAR fans at the Ford 400 in Florida. They were the grand marshals of the season's last race. The two were also there to honor U.S. troops and their families.

Also, this fog causing problems at Atlanta's Hartsfield International Airport. No flights allowed to land until 8:30 a.m. eastern. So call ahead to see if your flight is affected. I bet it will be, as all flights will probably be throughout the day. Good luck out there.

That's the news you need to start your day. AMERICAN MORNING, back after the break.


CHO: Good morning, New York. Do you know the leaves are turning? This is beautiful as you look at Central Park. Cloudy and 52 degrees.

COSTELLO: It's the end of November, Alina!

CHO: I know. But you know what? I look outside of the cafeteria and notice the leaves are turning. I don't know where I have been for a month. But anyway --


CHO: -- it's cloudy and 52 degrees. Showers and 52 later. It's going to be a messy day.

COSTELLO: Yes, it will be ugly.

But welcome back. and forget Black Friday. The Christmas shopping season is already under way. But before you buy anything, Christine Romans has helpful holiday shopping tips in this week's "Smart is the New Rich".


CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Carol and Alina, hello to the holiday hype machine. Retailers will do whatever they can to separate you from your money whether you have it to spend or not. So holiday buyers beware. Here are five steps to outsmart them.

Don't open a store credit card. Most have very high interest rates and credit limits are too low. Even applying for them hurts your credit score. That one-time 10 percent off may not be worth it. Now, if they are not pushing the store credit card, they're pushing the extended warranty. Don't waste your money.

MANDY WALKER, "CONSUMER REPORTS": In fact, you really seldom should take the extended warrantee. Never is probably OK.

ROMANS: Mandy Walker, of "Consumer Reports," says your credit card may already cover you, plus --

WALKER: Things seldom break during the extended warrantee time period, which is probably only two or three years past the time you bought it. And the manufacturer's warrantee will probably last the first year.

ROMANS: Gift cards aren't always a great gift. A quarter of all gift cards are still lying in your purse or desk drawer 10 months after you get it. This is according to "Consumer Reports." Two- thirds of people who get them spend more than the card's face value so they are basically paying for their present. Unless you know for a fact the recipient wants it and will use it, you are probably buying the retailer a gift.

Also be leery of layaway. There are up front fees. What it the item goes on sale? And if you miss a payment, the retailer could cancel the layaway and you will lose money.

And finally, do not pay full price. Beware of retailers who jack up a price before lowering it again. And hunt through the online sites like retailmenot for coupon codes that you can plug in for online shopping.

Make it your mission never to pay for shipping. There are always free shipping deals just around the corner.

And don't buy the hype. Black Friday prices are not always the lowest of the season.

Carol, Alina?


COSTELLO: So stay home!


Don't wait in line at 1:00 in the morning.

CHO: 152 million Americans will be out shopping. I mean, you know?


COSTELLO: It's sort of like their own holiday tradition.

CHO: It is a holiday tradition.

COSTELLO: To go into a crowded department store and jostle people around to get bargains that may not be bargains.

CHO: That's absolutely right. People buy into the hype.

COSTELLO: It's beautiful.

CHO: It's all beautiful. It's all American.

"A.M. House Call" now, and the FDA voting to stop giving women false hope. In a rare move, it pulled approval of the drug Avastin for treating breast cancer. The drug was rushed through the approval back in 2008 after a single study showed it could slow the effects of the disease. Now the FDA says those risks don't outweigh any possible benefits. Avastin does remain on the market for treatment of certain types of brain, colon, kidney and lung cancer.

COSTELLO: It's being called a smart bomb for your mouth. A UCLA microbiologist says he has developed a mouthwash that virtually eliminates bacteria responsible for cavities and tooth decay. He says we may be able to wipe out tooth decay in our lifetime. It's unclear if this means the end of brushing your teeth.


COSTELLO: I hope not. That doesn't sound good.


CHO: No.

COSTELLO: All right.

CHO: Still ahead on AMERICAN MORNING, she's a model, a writer and an advocate. Now Christy Turlington Burns makes her directorial debut with a new documentary. And she's going to join us live in the studio to talk about it.

It's 57 minutes after the hour.


CHO: New York terror plot spoiled. Good morning, everybody. I'm Alina Cho. A man arrested after he allegedly built a bomb ripped right from the al Qaeda handbook.

COSTELLO: Isn't that super? A bipartisan congressional committee --