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American Morning

Iran Claims It Shot Down U.S. Drone; Herman Cain Suspends Presidential Campaign; Analysts Speculate on Timing of Cain's Endorsement; Death Sentence for Triple-Murderer?; Iran Claims It Shot Down U.S. Drone; Cain Suspends Campaign; Winter Storms To Hit The West; Can The Euro Be Saved?; USPS To Announce New Plan; New Jerry Sandusky Interview; Assange Wins Right To Appeal Extradition; Biden in Greece; Dems To Offer Payroll Tax Cut Compromise; Ten People Trampled At OSU Game; Radioactive Water Leak At Fukushima; Putin's Party Gets Pounded In Russian Elections; Costly Car Crash; Iran Promises Aggressive Response, Warns Washington Not to Block Oil Exports; Average Workers Saves $934 From Payroll Tax Holiday; Credit Card Use Goes Up During Holidays

Aired December 05, 2011 - 06:59   ET


CHRISTINE ROMANS, CNN ANCHOR: Iran promising an aggressive response after claiming it shot down an American spy drone. The U.S. now admitting one of its drones is missing. The fallout ahead.

ALINA CHO, CNN ANCHOR: Courting Cain. His campaign may be over, but Herman Cain could still influence who gets the GOP nomination. His potentially game-changing endorsement could come as early as today.

ROMANS: More powerful gusts in the forecast for L.A. this morning. Winds strong enough to spark dangerous fires as tens ever thousands remain in the dark, on this AMERICAN MORNING.

Good morning, everybody. It's Monday, December 5th. Ali and Carol are off. I'm Christine Romans in, along with Alina Cho. Good morning, Alina.


CHO: Good morning, Christine. Good morning, everybody. Glad you're with us.

A highly classified U.S. stealth drone may be in the hands of Iran. Iranian officials claim they shot down a drone after it invaded its airspace. American military officials only confirming one of its drones is missing. Now Iran is vowing an aggressive response. We want to bring in Pentagon Correspondent Barbara Starr for this. She is live at the Pentagon with more. Barbara, good morning.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Good morning to both of you. Let's take a quick look right away at what we are talking about. This is a photo of the type of drone that everyone is talking about right now, the RQ-170. Iran says they shot one of these down over their territory, that it was flying along that border with Afghanistan, eastern Iran, that that's where they shot it down.

Now, what are we talking about? This is the RQ-170 sentinel drone, developed for the Air Force. It is stealthy. It can fly without being detected. And what it does is it flies along, gathers intelligence information, reconnaissance targeting information. It is one of the key weapons in the U.S. military and intelligence arsenal.

Now, what is the U.S. saying about it? So far using the NATO alliance in Afghanistan, the only thing that has been said is the following statement issued yesterday, saying, quote, "The UAV to which the Iranians are referring may be a U.S. unarmed reconnaissance aircraft that had been flying a mission over western Afghanistan late last week. The operators say the UAV lost control of the aircraft and had been working to determine its status."

So the U.S. is not saying that it was shot down. It is not saying that it is an RQ-170, simply saying they lost a drone over the border region, but all indications are that it went down in Iran. Key question now -- what does Iran have its hands on, and do they now have access to some of the U.S.' most secret surveillance technology? Christine, Alina?

ROMANS: And Barbara, we A complicated relationship for some time between Iran and the U.S. What options does the U.S. have here?

STARR: Well, not very many. What they'd really like to know, of course, is do the Iranians have the wreckage and what condition is that wreckage in? Is it possible that Iran got to it and got any information about either stealth technology or some of the sensors onboard?

Now, when these drones crash, the operators knew they had lost control of it. Were they able to essentially self-destruct any of the sensitive technology? That's not clear.

Look, Iran is not giving this back. Whatever they have, they're not giving it back. What's really interesting is so far they haven't shown any photos of it from Iran, from the Iranian authorities. That's what the U.S. is waiting for and the U.S. wants to see to determine what shape this wreckage is in.

ROMANS: And we know the black market for such stealth technology and sensors particularly from China is very aggressive. So hopefully they don't have it, but we just don't know. Thanks so much, Barbara.

Now to politics and the courting of Herman Cain. The former GOP front-runner dropped out of the race on Saturday, unable to overcome allegations of sexual harassment and then allegations of a 13-year extramarital affair.


HERMAN CAIN, (R) PRESIDENTIAL CANDIDATE: I am suspending my presidential campaign because of the continued distraction, the continued hurt caused on me and my family, not because we are not fighters, not because I'm not a fighter. (END VIDEO CLIP)

ROMANS: Now Cain's former rivals are scrambling for a potentially game-changing endorsement. Let's talk about the all- important endorsement and how it might play out with CNN contributor John Avlon live in Nashville. But first let's go to CNN deputy political director Paul Steinhauser in Washington. Paul, a lot of speculation Cain could announce his endorsement today, although Jim Geraghty just told he thought that it wouldn't happen today. Is it a game changer or does Herman Cain drag it out so he can stay on the front page?

PAUL STEINHAUSER, CNN DEPUTY POLITICAL DIRECTOR: Yes, the longer he waits, the more we keep our eyes. And last week we were keeping our eyes on Herman Cain every day, every second to see when and if he would drop out. He did obviously suspend his campaign. This week it's who will he endorse and when?

Let's talk about Newt Gingrich, because there's some speculation. Remember on Saturday after Cain dropped out Gingrich came in front of cameras in Staten Island, New York, and said nice things about hit fellow Georgian. Gingrich has a news conference at 1:45 in New York City, but there is no indication that Herman Cain will be there and we don't know what the news conference will be about. We will continue to dig on that.

Two other candidates that may benefit from Cain dropping out -- Ron Paul and Michele Bachmann, both popular with the Tea Party movement, as is Cain. Take a listen to what they said on our "State of the Union" with Candy Crowley.


RON PAUL, (R) PRESIDENTIAL CANDIDATE: They're going to go somewhere in the next week or so. That's going to happen. So I'm optimistic that we'll pick up some votes from there.

MICHELE BACHMANN, (R) PRESIDENTIAL CANDIDATE: A lot of Herman Cain supporters have been calling our office and they've been coming over to our side. I think part of that is because people see that I'm the Tea Party candidate in the race. They saw Herman Cain as an outsider. And I think they see that my voice will be the one that would be most reflective of his.


STEINHAUSER: Tomorrow marks four week until the first votes in the Iowa caucus. So where does the race stand with Cain out of it? Take a look at this, NBC Maris poll, this is of people likely to attend the Iowa, those GOP caucuses on January 3rd. There's Newt Gingrich continuing to surge, 28 percent support. Ron Paul and former Massachusetts governor Mitt Romney at 19 percent, Texas governor Rick Perry at 10 percent. But one other takeaway from this poll, a lot of people still undecided and a lot of people willing to change their vote over the next four weeks. Christina and Alina?

ROMANS: All right, thanks, Paul.

CHO: An endorsement from Cain, as you heard, could be critical because the polls show Newt Gingrich gaining ground in Iowa while Mitt Romney appears to be headed in the wrong direction in New Hampshire. CNN contributor John Avlon live in Nashville, Tennessee for us. Hey, John, good morning to you.

So we're hearing conflicting reports about whether this endorsement is going to happen today, if at all. But if Herman Cain does, in fact, endorse Newt Gingrich, how does it change the race?

JOHN AVLON, SENIOR POLITICAL WRITER, "NEWSWEEK" AND "THE DAILY BEAST": Well, it does help Newt coalesce that anti-Romney vote, the conservative alternative for Romney, which he's been surging on. First we had Perry, then Cain, then Newt Gingrich, and it really does seem like Newt is surging at the right time. A CNN poll just the other week showed that 38 percent of Herman Cain voters would go to Newt Gingrich's camp. So this is likely to formalize that movement. I think Ron Paul and Bachmann are both hoping for a bit of a bump here as well, but it makes sense that Newt would get the benefit from the bulk of Cain supporters looking for an alternative.

CHO: Timing is everything, as you say. I want to look at the polls again, because you look first in Iowa. And you're right. Gingrich has the lead. Ron Paul in second there, Romney in third. It is still close. Over in New Hampshire, which is of course the second big test, Romney's backyard, he is still in the lead, but that lead is shrinking. Could we see surprises here? And how do you see it playing out in the next several weeks? You're hearing a lot about Jon Huntsman being a potential spoiler.

AVLON: Jon Huntsman has been inching up in New Hampshire, which is at least a move in the right direction. Newt Gingrich announcing late last week he would host a Lincoln Douglass-style debate in New Hampshire with Jon Huntsman, elevating Huntsman effectively and boxing Romney out.

Look, the overall trends are clear. They get starker if you look to Florida where there have been some stunning polls showing Gingrich with as much as 40 or even 50 percent of that vote, Romney trailing far behind. Newt Gingrich is surging basically across the board. Mitt Romney's been declining slightly.

So that actually creates a real opportunity for that, for that Newt momentum to carry him through January where we've got Iowa, New Hampshire, South Carolina and Florida. The Romney camp's got to be real nervous right now about the way the trends are going. And Newt's got to be feeling pretty good.

CHO: You mention Romney heading in the wrong direction. I mean, with Newt Gingrich in the news so much we're not talking as much as mitt Romney. In fact you recently wrote a piece for "The Daily Beast" calling Romney's campaign a sinking ship. I found this interesting. You actually likened him to Hillary Clinton back in 2008, saying both had this aura of inevitability. So how does Romney right the ship? AVLON: First of all, he needs to recognize that the status quo strategy isn't working. What you have is the idea of the inevitability campaign imploding. And the way to deal with that is to start playing off that, to recognize that you're no longer in that sanguine position and he needs to start playing offensive against Newt but start campaigning like he's behind.

Two weeks ago he decided to play in Iowa, a big, strategic decision, because he got burned there four years before. Now he's in third place behind Ron Paul. So he needs to recognize there's still time to right the ship, but he's got to start playing offense right now, draw some clear contrasts, and make a point about electability. That's sort of his trump card, the key going forward.

CHO: There have been some rumblings among insiders in Washington, as you know, talking about Newt Gingrich potentially being a better general election nominee at this point. Do you think he has staying power?

AVLON: Well, look, it's an issue of timing. You know, right now the sort of conservative alternative to Mitt Romney's post has been hanging on around five week on average, if you look at that. That will carry Newt through Iowa giving him a lot of momentum.

You need to recognize that Ron Paul's in second place in Iowa now. That's an additional factor here. But he could be sort of in that alternative position at the right time to really start sailing through primaries. Then the Republican party's going to need to deal with the fact they've got a very smart sort of policy wonk as their front-runner.

But the Romney camp can't be liking the trends. That's a significant thing. This guy has been holding in there. He's got a professional team. He's been serious and disciplined. But that Bret Baier interview from last week, for example, is devastating, because it shows a candidate who is easily rattled by pretty basic questions. So you know, the Romney camp needs to realize, this is time for sort of Def-Con III and they need to deal with playing offense the next couple weeks.

CHO: John Avlon, CNN contributor -- not sure why you're in Nashville Tennessee and not right here on the couch in New York, but always great to see you.

AVLON: I'll be back.

CHO: OK. Good.

ROMANS: All right, Senate Majority Leader Harry Reid will unveil a payroll tax cut compromise today. This is a measure that would matter for every working American. It's a compromise between the dueling plans rejected by the Senate last week. No word yet on specifics, but Democrats say it includes a serious way to pay the more than $200 billion price tag. And, of course, if they don't come up with a solution, working families will see their tax bill increase next year. No question. CHO: I want to talk about what's going on in California right now. Tens of thousands of people are still without power from last week's wind storms in southern California. And forecasters warn another blast of high winds could be a big problem this morning. Now that's raising some big concerns in fire-prone areas like Malibu and western L.A. Three-hundred firefighters are in position just in case.


CHO: Coming up, a fierce face-off at Occupy D.C. Police had to bring in a cherry-picker to remove some of the protesters. We'll tell you what happened.

ROMANS: And a new interview with a disgraced former Penn State coach Jerry Sandusky. He says prosecutors misrepresented his words with children through the Second Mile charity he founded. Jerry Sandusky in his own words ahead.


ROMANS: Welcome back.

It was a home invasion in Connecticut that shocked the nation back in 2007. And now, jurors return to a courtroom in Connecticut today. They're going to begin deciding whether a triple murderer will live or die.

CHO: That same jury found Joshua Komisarjevsky guilty of all 17 charges in the murders of Jennifer Hawke-Petit and her daughters Michaela and Hayley.

Deb Feyerick is live in New Haven for us this morning.

Deb, good morning.

DEB FEYERICK, CNN CORRESPONDENT: Good morning, Alina. Good morning, Christine.

Well, this jury, this 12-member jury, they're going to have to agree with one another a total of 600 times, and that's because when they make their decision as to whether Joshua Komisarjevsky should live or die, they're going to have to weigh both the aggravating factors supported by the prosecution and the mitigating factors reported by the defense team.

The defense team spending the last six weeks trying to convince the jury that, in fact, Joshua Komisarjevsky is worthy of staying alive, even if it means staying alive the next 40, 50, 60 years in prison. What the defense lawyers tried to do is they tried to portray him as a loving father, they tried to portray him as somebody who has a support system, somebody who was sexually abused as child and that led to a whole range of emotional and mental problems, including suicidal behavior, self-destructive behavior.

But they say this is a person whose life should be spared. The defense saying Josh is a human being. Albeit severely damaged, his life has value.

On the other hand, prosecutors, they said, look, this is somebody who created among the heinous of imaginable crime, basically held this family hostage, including a mother, a husband and two daughters. The father, the only one who survived this tragedy. Prosecutors say he should be put to death; that there's really no question about it.

In their words, "How many people do you have to kill before the death penalty is appropriate?" That is what the jury is going to be weighing. This has been a very long trial. Both with the guilty phase, now the penalty phase. And they've got to decide whether in fact the death penalty is appropriate.

Again, they're going to have to agree unanimously 600 times. So, they've got their work cut out for them -- Christine, Alina.

ROMANS: All right. Deb Feyerick -- thanks, Deb.

CHO: Hours long standoff between police and Occupy D.C. protesters as demonstrators were given an hour to dismantle an unfinished wooden structure that they had built inside the park.

ROMANS: And when they refused, police moved in with a cherry picker.

Here's Athena Jones with the details.



After more than nine hours and a tense standoff between Occupy D.C. protesters and police came to an end with 31 arrests total from throughout the day. The standoff began in the late morning when police ordered demonstrators to take down a structure they had erected overnight. Police said that there were safety concerns regarding the structure and it hadn't gone through the proper permitting process.

And so, the demonstrators refused to take down the structure. Many of them occupying it themselves, some climbing on to the roof where they held on for hours. They led chants with a crowd of demonstrators here who have been camped out in this park since early October. Many of the demonstrators in the crowd threw food and water to the people who are on the structure over the course of the day.

Ultimately, police used a cherry picker, a giant inflatable cushion, two ladders, various ropes and harnesses to get the last protesters off of the roof of the structure. The process of getting these demonstrators off the structure was at times dangerous because of these safety concerns and structural integrity concerns with the building. At one point, you had police warning people to -- warning their cohorts to stop because there were concerns one of the rafters might break.

But ultimately were able to get all ever the protesters off the structure. Thirty-one arrests here in this park, McPherson Square, which is just a few blocks away from the White House.

Back to you, Alina and Christine.


ROMANS: All right. Athena Jones in D.C. -- thanks, Athena.

Athena, Alina -- tripped me up for a second.

CHO: This story really got our attention. An 85-year-old grandmother from Long Island says she is considering filing a lawsuit against the TSA after allegedly being strip-searched at JFK Airport. That's her right there. Her name is Lenore Zimmerman.

She was getting ready to fly from New York to Ft. Lauderdale last Tuesday when she says she was traumatized by two female TSA agents.


LENORE ZIMMERMAN, CLAIMS SHE WAS STRIP-SEARCHED BY TSA: I have a defibrillator, so I don't go through the machines. I asked them to pat me down. They took my pants down and then they took my underwear down.

Don't I look like a terrorist? I'm going to be 85 years old and I weigh 103 pounds. And they strip searched me.


CHO: Lenore says she also suffered a cut on her leg during the search. The TSA denies she was strip-searched, insisting that proper procedures were followed. But they have apologized to Lenore for the, quote, "unpleasant screening experience." How sad.

ROMANS: And the unpleasant public relations that had followed for the TSA.

CHO: That's right.

ROMANS: All right. Still to come this morning, a celebration gone terribly wrong. Ten fans trampled at the Oklahoma State football game.


ROMANS: Welcome back. "Minding Your Business."

U.S. future stocks trading higher this morning following a stellar week last week with U.S. markets up more than 7 percent. Whether the markets continue that run depends on negotiations in the euro zone where leaders are working feverishly to save the euro.

And pushing Europeans markets up overnight, new austerity measures this weekend by Italy's new prime minister, Mario Monti. Italian borrowing costs are falling this morning. And that's a good sign that investor are confident that Italy is moving in the right direction to balance its budget.

All right. The price of all of those unemployment checks here, the Labor Department says $434 billion has been spent over the past four years on jobless benefits, more than $400 billion. That's a figure sure to be brought up in Congress in the weeks ahead as Republicans and Democrats duke it out over whether to extend the year end deadline for additional federal jobless benefits.

The price of home heating oil is expected to rise 10 percent this winter. The government is blaming unrest in the Middle East, particularly Libya. The average cost for this winter's heating season from October through March is supposed to be about $2,500, according to the government.

Facebook is hiring thousands of new workers. The social networking giant gearing up to go public next year. The company anticipates rapid growth and expanding its team to keep up.

AMERICAN MORNING will be right back after a quick break.


CHO: Welcome back to AMERICAN MORNING on a Monday. It's 30 minutes past the hour. Your top stories now.

A highly classified U.S. stealth drone may now be in the hands of Iran. Iranian officials say they shot down the drone after it invaded its airspace along the border with Afghanistan.

American military officials only confirming one of its drones is missing, but maintain they do not fly over Iranian airspace. Iran is now vowing an aggressive response.

ROMANS: All right, Herman Cain may have thrown in towel, but he says he's not a quitter. Instead he's insisting he had to get out of the GOP race because it's hurting his family.

The former candidate says he'll be endorsing one of his former rivals soon. In the meantime, Newt Gingrich on the top of the polls in Iowa.

CHO: Another high wind morning is in effect for Southern California, gusts may reach hurricane force. Officials warned that more power outages and damage could be on the way. In the meantime, some states like New Mexico and Colorado could see 10 inches of snow.

ROMANS: U.S. investors have their eyes on Europe this week. The European Union is working to overcome its debt crisis. French President Nicholas Sarkozy and German Chancellor Angela Merkel meeting in Paris this morning to talk about the possibility of a new E.U. treaty.

CNN's Nina Dos Santos is live in Paris. Nina, the big question on everyone's mind is, can the euro currency and the countries that use it, can this be saved? NINA DOS SANTOS, CNN CORRESPONDENT: Yes. That's now become a one trillion euro question to answer and it's one that politicians have been spending the best part of the last six months or so answering.

All these rafts of different summits that we've seen and what we've got going on the cards today, Christine, is what we saw about four months ago when we had these big E.U. leaders meeting.

What we tend to have, two, three days before, the heads of France and also Germany, as the two largest economies in this region, meeting before to try and steer the discussions. Hammer out some kind of proposal, concrete proposal for solving the crisis. That they later on are going to be putting forward towards the other colleagues to ratify.

Now, what they're going to be talking about today, I must point out, the German chancellor has not let us down on the famed German punctuality. She just arrived here in Paris in France, about two minutes ago, bang on time for that lunch that they're going to be having.

And they're going to be trying to hammer out some kind of proposals for getting these countries, all 17 in the Euro zone, to adhere to strict budget discipline. France and Germany have in the past clashed on exactly how strict those rules should be and indeed how they should be implemented.

But the hope is that they can get something in place before the middle of the week and then the end of the week so that eventually perhaps even the European Central Bank can step in with a whole wad of cash to try and help solve the problems that some of these countries are having, particularly when it comes to financing themselves in the world's markets -- Christine.

ROMANS: You know, it's incredibly complicated, Nina. But last week the crisis economist expert, Ted Roguff said think of it like 17 members of an extended family all sharing the same checking account, but all with different ideas about the rules to use that account.

And that's, I guess, bringing it down to the very simplest course. That's what's going on here. Nina Dos Santos in Paris. Thank you, Nina.

CHO: The cash-strapped United States Postal Service will announce a new cost cutting plan this morning. Listen to this. Under the proposal, first class mail would no longer be delivered the next day.

The agency wants to change its national standard to two to five days from one to three. No word yet when the plan could take effect. The Postal Service has racked up more than $5 billion in debt this year.

ROMANS: OK, a new interview with disgraced Penn State Coach Jerry Sandusky. The former coach slapped with 40 counts of raping and molesting young boys. The investigation is still ongoing and Sandusky spoke on camera with the "New York Times."

CNN's Susan Sandiotti has the details.


SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT (voice-over): In an interview videotaped by the "New York Times," Jerry Sandusky not only repeats his denials of wrongdoing, he tells the paper, youngsters in this Second Mile program, quote, "might say I was a father figure."

A father figure who stands accused of 40 counts of raping and molesting young boys. A few weeks ago, NBC's Bob Costas asks Sandusky whether he sexually attracted to young boys.

JERRY SANDUSKY, FORMER PENN STATE ASSISTANT COACH (via telephone): Am I sexually attracted to under aged boys?


SANDUSKY: Sexually attracted? I enjoy young people.

CANDIOTTI: The former coach tells the "New York Times" at first, he wondered what to make of the question. Then, in an intriguing exchange and apparently uncomfortable Sandusky tries to explain his answer, off camera you'll hear the voice of Sandusky's lawyer prompting his client.

SANDUSKY: If I say, no, I'm not attracted to boys, that's not the truth, because I'm attracted to young people, boys, girls --

UNIDENTIFIED MALE: Yes, but not sexually. You're attracted because you enjoy spending time.

SANDUSKY: Right. I enjoy -- that's what I was trying to say. I enjoy spending time with young people. I enjoy spending time with people. I mean, my two favorite groups are the elderly and the young.

CANDIOTTI: An attorney who represents victim number six named in the grand jury report, the boy whose mother came forward in 1998 saying Sandusky had showered with her son and hugged him naked from behind says the accused coach's latest explanations are hard to watch.

HOWARD JANET, ATTORNEY FOR VICTIM NUMBER SIX: His answer was really no different, frankly, than the answer that he gave before, and the sad part from his perspective, if we want to look at it from that perspective, is his lawyer had to intervene and give him advice as to how to answer that question. He won't have that luxury in the courtroom.

CANDIOTTI: Sandusky admits that after he was banned from taking young people on to Penn State's main campus, following a 2002 allegation that he raped a boy in a locker room, he still had access.

Sandusky told the paper then Athletic Director Tim Curley never took away his keys, quote, "I still have my keys," Sandusky said, "and I still went in there and worked out." MARCI HAMILTON, VICTIM'S ATTORNEY: Any argument that these men now are making any of this up is really weak, and if that is all that he has in terms of his defense, he going to have a really rough going in the courts.


CANDIOTTI: Sandusky again denies that then head coach Joe Paterno ever mentioned anything to him about the 2002 shower allegation. Sandusky faces a preliminary hearing in a couple of weeks among the expected witnesses, at least one of his accusers. Susan Candiotti, CNN, New York.

ROMANS: All right, it's 37 minutes past the hour. Here's what's new this morning. Only hours ago we learned that Wikileaks founder, Julian Assange, won his chance to appeal against his extradition from the U.K. to Sweden.

He'll make his case to Britain's Supreme Court. Assange is wanted for questioning over alleged sex crimes in Sweden. He's accused of sexually assaulting two women back in 2010.

CHO: Vice President Joe Biden is in Greece. He'll be meeting today with that country's president and the new Prime Minister Lucas Papademos. On the agenda, Greece's crumbling economy and how to best implement the E.U.'s controversial bailout plan.

ROMANS: All right, Senate Majority Leader Harry Reid will unveil a payroll tax cut compromise plan today. It's a compromise between the dueling plans rejected last week by the Senate.

No word yet on the specifics, but Democrats say it includes a, quote, "serious way to pay the more than $200 billion price tag." It's a move that would affect every working family in America.

CHO: Take a look at this video. Ten people were injured over the weekend when fans, thousands of them, rushed on to the field following the Oklahoma/Oklahoma State football game. The Cowboys beat the archrival Sooners 44-10. Two of the victims had to be airlifted to local hospitals.

ROMANS: A new leak of radioactive water in Japan's crippled Fukushima nuclear plant. Some 12,000 gallons of contaminated water found gushing from a purification facility. The plant's operator say some of that tainted water may have leaked into the Pacific Ocean.

CHO: According to preliminary election results in Russia, Prime Minister Vladimir Putin's party is winning, but barely hanging on to the majority. The party stands to lose many of the 300 seats it currently holds in parliament. Russian police crackdown on election protesters, about 100 people were arrested in Moscow.

ROMANS: And in south western Japan -- wow. They may have just witnessed the costliest car crash in history. Eight Ferraris, three Mercedes, a Lamborghini, all involved in a highway pileup in Yamaguchi. They were part of a luxury sports cart car event, total damage, $3.8 million.

CHO: Wow. I'm actually surprised it's not a little bit more. Unbelievable.

And take a look at this. It's known as Panda diplomacy. I love the story. Two giant panda bears arrived in Scotland yesterday. China is loaning the bears to Edenberg Zoo for 10 years as an act of goodwill.

Sweetie and Sunshine are their names. They're going to become Britain's first breeding pandas in 17 years. What an attraction.

ROMANS: I love it.

All right, still to come, Iran promising an aggressive response after claiming it shot down and unmanned American spy drone. What the U.S. military is saying, ahead.

CHO: And she has a new album in the work, a big screen project, now word Madonna could be taking the stage during football's biggest night. You're watching AMERICAN MORNING. It's 40 minutes after the hour.


ROMANS: Welcome back. Iran is promising an aggressive response after claiming its military shot down an unmanned U.S. spy drone along its border with Afghanistan.

The Iranians also warning Washington not to block their oil exports insisting such a move, they say, the Iranian's say that would more than double the price of crude.

Let's bring in Jim Arkedis, director of the Progressive Policy Institute's National Security Project. He joins us live from Washington this morning. Good morning.

UNIDENTIFIED MALE: Good morning. Thank you very much for having me.

ROMANS: So this drone is reportedly the same model that flew stealth missions over Bin Laden's hideout and was never detected by Pakistani air defenses.

The U.S. says it was flying a mission over western Afghanistan. Do you really think this was a mission maybe to hunt for hidden nuclear sites in Iran?

JIM ARKEDIS, DIRECTOR, PROGRESSIVE POLICY INSTITUTE'S NATIONAL SECURITY PROJECT: Well, look, maybe it was. Maybe it wasn't. The important take away from this is that whether it was shot done or whether as the U.S. military claims, it lost control and went down of its own volition.

The important point to take away here is that the Iranians now have a very sensitive piece of American military technology in their hands and they'll exploit it. I just really hope that there's a self-destruct button attached to it.

ROMANS: Yes, and we knew, Barbara Starr was reporting that certainly the people who were losing controlling this drone knew that they were losing control.

I certainly hope there was a self-destruct button because, you know, the Chinese, for example, are aggressive consumers on the black market for American center and stealth technology.

ARKEDIS: Absolutely. It doesn't matter what sort of piece of technology you're talking about, whenever there's a piece of proprietary U.S. technological information you don't want it to end up in the hands of Iran, China or anyone else.

ROMANS: And for people who aren't following all of this, there was an explosion at a major missile testing site in Iran last month. Nuclear scientists have been assassinated on the streets of Tehran and there was a computer virus last year. Is there sort of a covert war already going on with Iran?

ARKEDIS: There are certainly very likely covert actions undertaken by the United States and its allies, but that's not the point. We're not in an over war yet and that's something that the United States certainly wants to avoid at any costs.

The best way to avoid that at this point is to continually ratchet up sanctions. We have to make sure that there's pressure on the Iranian regime. This amendment that just passed the United States Senate, it passed 100-0, in an area when Congress can't agree on anything. We had bipartisan, unanimous support for a Senate and -- and I'll shorten and cut out a lot of stuff here, but essentially it would make it difficult for the Iranians to sell oil on the international market.

You mentioned in the intro the fact that oil -- the Iranian officials claim oil will go to $250 a barrel. I think this is pretty much an exaggeration, because any supply taken off the world market can be increased by increasing production in Saudi Arabia. Libya's going to come online, and Iraq. The important point to remember is that if you want to avoid an overt war, we've got to continue the pressure on the Iranians through ever-increasing targeted and layered sanctions.

ROMANS: But how do the sanctions work? Are there any -- the White House has said that it is concerned about higher oil prices and it's being careful how its handling Iran.

ARKEDIS: Oh, sure. The United States is being very careful. The Obama administration has done very good. It's been very tough up to this point. The Obama administration had led several rounds of sanctions against the Iranian regime. In this case, we want to be careful to not accidently give the Iranians a windfall. But at the end of the day, I think the claim that oil prices are going to skyrocket is based on scare tactics and a faulty premise.

ROMANS: So much attention in this country has been pretty myopic recently, I'll be honest with you. It's been about the Republican -- the race for the Republican side of the aisle. About jobs and taxes in this country. But we have seen tensions rising between the West and Iran, even as we're very focused inward. Haven't we?

ARKEDIS: Oh, yes, of course, no doubt about it. Of course. At a point, when we see the GOP talking in debates about -- Michele Bachmann, for example, said something along the lines of Pakistan, you know, the best -- we have to treat Pakistan differently because they have a bomb. Let me tell you, as this pertains to Iran, it's a really important point because she sent a very bad signal to countries that, if they get a nuclear bomb, the United States has to treat you differently. In the case of Iran, we want to be very aggressive to be sure we don't get to that point and have to consider a bunch of very bad policy options.

ROMANS: We don't get to the overt point. One final question. Do you see a scenario? Because inside Israel right now, there's a very vigorous discussion about whether there should be some sort of action against Iran. A full military strike on Iran, for example. Would that be something we would see?

ARKEDIS: Would it be something we see in terms of before they go ahead and do it?

ROMANS: No, no. Would -- is that something that's possible? On the table? Do you think that's possible?

ARKEDIS: Oh, yes. Of course. Of course, it's on the table. There's a vigorous discussion, as you said, Israeli Prime Minister Netanyahu and Ehud Barak have sort of been pushing the discussion towards possible military action against Iran. There are some former security officials who have come out publicly against it. The issue is that Israel is a sovereign state and it's going to make the choices that it feels best protect its security.

ROMANS: Right. And you don't think --


ARKEDIS: That's why it's so important to push sanctions now, so we don't have to get to that point.

ROMANS: To your question about my question, you don't think they would ask the U.S. for a green light?

ARKEDIS: No, not necessarily. Like I said, Israel makes its own security decisions within the context it sees and has to make those choices.

ROMANS: Certainly, the heat is rising. I wonder what that aggressive response could be from the Iranians at this point.

Jim Arkedis, Progressive Policy Institute National Security Project.

Thank you so much. ARKEDIS: Thank you for having me.

ROMANS: A lot of "P"s in there, Jim.


OK, thanks a lot.

ARKEDIS: Thank you.

ROMANS: Have a good morning and a good week.

CHO: Talk about big news in sports, Tiger Woods is back in the winner's circle after a two-year drought. He rolled in a 10-foot birdie putt on the final hole yesterday for a one-stroke victory over Zach Johnson in the Chevron World Challenge in California.




Something you haven't seen in a while.

And look at that. It's official! The NFL says Madonna will be the featured performer at this year's Super Bowl half-time show. 53 years old. Can you believe it? The Material Girl will collaborate and perform with Cirque du Soleil. Super Bowl XLVI is February 5th in Indianapolis.

ROMANS: You see that's she's (INAUDIBLE). Don't you think she has a body of a 33-year-old?

CHO: She does. She looks amazing.

ROMANS: There's not an ounce there that isn't, like, worked, I'm sure. Like, lots of Pilates?

CHO: Exercise.

ROMANS: Is that Pilates? What does she do?

CHO: Lots of exercise. I think she does yoga. But she also eats very well. She stays very fit. She looks amazing.

ROMANS: Still to come this morning, yes, it's gift-giving time. And your wallet isn't feeling the holiday cheer. OK, I'm going to not be too bah-hum-buggy here. I'm going to show you how to put Santa on a budget.


Put Santa on Scrooge budget. Be smart and still be happy for the holidays.

CHO: That's something I want to hear.

ROMANS: I'm going to deliver all that.


CHO: OK, good.

And are you having a hard time quitting smoking? Blame mom and dad? That's right. A new study finds that genetics may play a big roll in nicotine addiction.

ROMANS: And today's "Roman's numeral's" $934. Here's a hint. How much you could stand to lose next year if Congress doesn't act soon.

It's 50 minutes after the hour.


CHO: Fifty-one minutes after the hour. Here's what you need to know to start your day.

Newt Gingrich surging to the top of the GOP heap in Iowa. A new "NBC News" poll shows that the former House speaker is leading with 26 percent. Mitt Romney trails behind at 18 percent.

Another blast of wintry weather is expected in parts of the west through tomorrow night. Another high-wind warning is in effect for southern California. Gusts could reach hurricane force. Officials warn that more power outages and damage could be on the way.

WikiLeaks founder, Julian Assange, will be allowed to appeal again his extradition from the U.K. to Sweden. He'll make his case to Britain's supreme court. He is wanted for questioning over alleged sex crimes in Sweden.

Vladimir Putin pounded in Russia's election. The prime minister's United Russia Party clinging to a slim majority in parliament. They could lose 60 seats. 100 election protesters were arrested in Moscow.

You're caught up on the day's headlines. AMERICAN MORNING is back after this.


ROMANS: Welcome back. Time for your "A.M. House Call." Researchers may have found a link between certain genes and ADHD. The genes that have been pinpointed help transmit signals between the neurons and the brain. The study found that at least 10 percent of children with ADHD had defects in these brain signaling pathways. Researchers say drugs that target these genes could be a treatment option.

CHO: Well, if you're having trouble quitting smoking, listen up. A new study finds that genetics may be linked to nicotine addiction. That's right. Blame mom and dad for that pack-a-day habit.


The study says new medications could be developed to help hard- core smokers. Smoking kills more than 400,000 Americans every year.

ROMANS: All right. This morning's "Romans' Numeral," a number in the news today, and my number today is $934.

CHO: Well, you already told me the answer.



ROMANS: It's how much the average worker gets from the payroll tax holiday. According to the Center on Budget and Policy Priorities, the non-partisan group says that 121 million families have benefited over the past year from this tax break. And Moody's Analytics says that letting the tax cut expire would reduce our economic growth by about half a percent.

So folks, what Congress does about this is important, because it is scheduled to expire at the end of the year. Democrats and Republicans agree on an extension of the tax holiday, but they disagree on how to pay for it. So you have a little bit of a $200 billion dispute going on right now that would affect every single working American family.

CHO: There is a compromise plan coming out today. We'll see whether that makes any difference.

ROMANS: We will.

Meanwhile, you're a retail fashionista. You know the retail world.

CHO: So you say, yes.


ROMANS: Retailers and banks want us to spend as much money as we possibly can.

CHO: That I know, yes.

ROMANS: Oh, they are. They want us to party like it's 2005. And forget all of those little things that happened with overconsumption. The credit cards are making a comeback, and it's working. More customers are paying with credit, a far cry from past years when shoppers opted for cash or debit cards. Credit cards, Alina, now inching towards pre-recession levels.

CHO: Oh. ROMANS: On Black Friday, seven percent more consumers paid with credit cards than last year. Banks are doing everything they can to get you to pull out the plastic. Credit card mailings surging 85 percent in the past year.

Meanwhile, debit card reward programs are getting the ax. So cash or credit? Americans, you and me, all of us, being encouraged to spend lots of money for the holidays. The National Retail Federation says you'll probably spend about $704. But with the debt crisis sweeping the globe, where is that money coming from? And have we learned nothing?


RICK NEWMAN, CHIEF BUSINESS CORRESPONDENT, USNEWS.COM: You see these numbers about how much money people are spending for the holidays, and it reminds you when people had expensive cars in their driveway, boats, fancy vacations. You wondered, how are they affording all of this?


And we seem to be back in that situation. The fundamental situation here is that real income, after inflation, has been flat for the last year or maybe even down a tiny little bit.


ROMANS: That means you have to be very careful about putting new debt on your credit cards. People say they want to be good spenders. Forty-two percent of you plan to spend less this year according to a new poll, but the road to debt is paved with good intentions.


LYNETTE KHALFANI-COX, THEMONEYCOACH.COM: There's a lot of data to show there's a disconnect between what people say they are going to do and what they actually do. Even when people say, I intend to pay off my credit card balances, for instance, they typically don't pay them off. That's why we've got about 15 million people right now in 2011 who haven't paid off their holiday shopping bills from 2010.


ROMANS: People who haven't paid off from 2010, who are going to put more debt on their credit card, don't be that person.

A few smart things to consider before you spend a dime. If you can't afford it, put it down, right? Make a budget. It sounds so simple. But simply make a list. Think about what you want to buy, and why, and then stick to it. You are smarter than the retail tricks.

Use technology. Comparison shop online. Use coupon codes. And never buy into the hype that these are the lowest prices that you're going to see. These are not the lowest prices. They're going to get lower. Take a time-out. If you see something not on your list that you want to buy, wait 48 hours and go back later. You would be surprised how often the urge fades with time.

And let's say your cost center is crying for that sold-out Leap Pad on the hottest toys list. A little advice from toy expert, Jim Silver. Shop in person, on Fridays, from 5:00 to 7:00 p. m. That's when toy stores restock for the weekend. So that's when you're going to have the best chance of getting that.

Did you know that?

CHO: That's a good tip. I did not.



CHO: I'm not in a lot of toy stores.

ROMANS: Everybody wants this Leap Pad. So I'm saying, if there's one thing that you really must get, and you can afford it --


CHO: What's a Leap Pad?

ROMANS: It's like an a little iPad for kids.


ROMANS: I don't want to be an advertisement for that thing. But I am telling you, for all of you parents who have been asking how to get it, 5:00 to 7:00 at the toy store on Fridays.

CHO: That 48-hour rule, I think really works.

ROMANS: Totally works.

CHO: And make the list. Sometimes it works. I'm one of those people. I do say I'm going to spend less this year, and I end up spending the same.


ROMANS: The road to debt is paved with good intentions. That's it.


CHO: Still to come this morning, Iran talking tough, vowing an aggressive response after claiming its military shot down an unmanned U.S. spy drone. We'll have details coming up.