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The Situation Room

Terrorists on the Web; An Obama Family Christmas; Jews Decry Elevation of World War II Pope; Terror Suspects to the Heartland; 9/11 Hero Dog's Legacy

Aired December 22, 2009 - 17:00   ET

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

MALVEAUX: President Obama says he called to congratulate Kaine for his work as governor. Kaine says he was genuinely just stunned.

Well, First Lady Michelle Obama and her daughters are spreading holiday cheer today to young patients at the Children's National Medical Center. And they brought, Bo, the dog, along to add to the festivities. And in our next hour, we're going to listen in. You're going to hear Mrs. Obama and Sasha and Malia read holiday classics to those kids.

And remember, for the latest political news anytime, check out CNNPolitics.com.

You're in THE SITUATION ROOM.

Happening now, a new cyber czar named to help increase security for the country's computer networks, as cyber crimes soar to alarming new levels, with victims losing more than a quarter billion dollars.

Also, an American Army general in Iraq now backing off from a threat to court-martial soldiers who get pregnant in the war zone.

Will it defuse the uproar over his controversial new policy?

And the Senate moves up its final vote on health care reform, with Democrats blaming Republicans for delaying it until Christmas Eve. We heard from the Democratic whip last hour. Well, this hour, Senator John Cornyn is here with us to hear the GOP side of the story.

Wolf Blitzer is off today.

I'm Suzanne Malveaux.

And you're in THE SITUATION ROOM.

In a war full of controversial decisions, this one stands out -- a U.S. general is raising the possibility of court-martial for soldiers who get pregnant in his war zone. There has been considerable back lash to this new policy -- so much so that the general is now seeking to clarify his position.

Our CNN Pentagon correspondent, Barbara Starr, has the very latest -- Barbara.

BARBARA STARR, PENTAGON CORRESPONDENT: Suzanne, in a conference call with reporters, Major General Anthony Cucolo stood his ground and said he will maintain a tough policy against pregnancy for those under his commented in Northern Iraq. Female soldiers who become pregnant or the men who impregnate them, will face disciplinary action, the general said.

Now, he clarified one key point, saying he had no intention of court-martialing soldiers over pregnancy.

(BEGIN VIDEO CLIP)

MAJ. GEN. ANTHONY CUCOLO III, U.S. ARMY: I regret that that term court-martial is bandied about or mentioned by one of the earliest written reports on this. I have not ever considered court- martial for this. I do not ever see myself putting a soldier in jail for this.

(END VIDEO CLIP)

STARR: But the obviously frustrated commander of 22,000 seemed keenly aware of mounting public reaction in some quarters.

(BEGIN VIDEO CLIP)

CUCOLO: I am the one responsible and accountable for these 20 (ph) people. The National Organization for Women is not. Critics are not. I appreciate, I -- I will listen to critics. They add thought. But they actually don't have to do anything.

(END VIDEO CLIP)

STARR: The general said he feels strongly about keeping this new tough policy in place for one reason. With the drawdown in Iraq, he said, female soldiers do critical jobs and he can't afford to lose any of them to pregnancy.

When a soldier in the war zone becomes pregnant, they are, indeed, sent home and other soldiers have to pick up the slack -- pick up the work that they had been doing. And he says he just can't have that happen when everyone is stretched so thin.

So, he says, this is all about making the soldiers aware of the consequences of their actions. The general said he has talked to some senior female troops about this. And so far, he says, he has gotten a positive reaction, but he's declining to publicly name the troops that he's talked to about this -- Suzanne.

MALVEAUX: OK. Thank you.

Barbara Starr at the Pentagon.

The White House is announcing a new cyber czar -- former eBay and Microsoft executive, Howard Schmidt. He's going to lead the president's efforts to improve security in the country's computer networks. It already involves some surprising tactics.

Our CNN homeland security correspondent, Jeanne Meserve, explains why.

(BEGIN VIDEOTAPE)

MESERVE (voice-over): Hackers hunker down in hoodies and headphones in a cut-throat competition to gain control of computer systems and keep others out. Here, it's legal -- a game called NetWars with more than a thousand people playing online. It's part of a cyber security talent search based on the premise that someone who can exploit a system knows how to protect it.

ALAN PALLER, THE SANS INSTITUTE: It would be silly for us to sit back and say, well, we don't want to teach people to hack. We're not teaching to hack. We're finding the ones who are good and we're giving them a chance to get better.

MESERVE: Dan Crowley who goes by the handle info nut (ph) acknowledges a lot of hacking is done in the shadows for money or mischief.

DAN CROWLEY, NETWARS CONTESTANT: Absolutely, absolutely. I mean, check your spam folder if you don't believe me.

MESERVE (on camera): So what's the incentive to do it in the daylight?

CROWLEY: Well, for one, you don't get thrown in jail.

MESERVE (voice-over): And you do make contacts. The reward for his performance here a pocketful of business cards.

CROWLEY: There was a gentleman here yesterday from the New York State Police.

MESERVE: Making those connections is one of the goals of the competition.

PALLER: And we're hoping we can rapidly and radically increase the speed with which these talented kids get into the workforce.

MESERVE: Right now, there is a disconnect. The winner here is a part-time student looking for a job, and the runner-up sells grapes for a vineyard.

MATTHEW BERGIN, NETWARS CORRESPONDENT: It's kind of a waste in talent, I guess, but...

MESERVE: The Chinese military reportedly holds competitions to cultivate its computer talent. The cyber exploits of Chinese hackers have contributed to the belief that future conflicts will be largely fought with a mouse, a keyboard and code.

The former director of National Intelligence says right now, the U.S. Is wide open to attack.

MIKE MCCONELL, FORMER DIRECTOR OF NATIONAL INTELLIGENCE: The nation is at strategic risk. And unless we find these youngsters, develop their skills, offer them opportunity, offer them education and then enlist their help and support and skills in combating cyber attacks, the nation will have catastrophic consequences.

(END VIDEOTAPE)

MESERVE: McConnell calls the cyber challenge useful, but not sufficient. Estimates are the nation needs 20,000 to 30,000 people with advanced offensive and defensive cyber skills. Right now, it has only about a thousand.

Jeanne Meserve, CNN, Washington.

(END VIDEOTAPE)

MALVEAUX: Well, cyber crime is growing at an alarming rate -- up 33 percent in one year. The Internet Crime Complaint Center logged more than 275,000 reports in 2008 and referred 73,000 of them to law enforcement. The vast majority of those involved financial loss, totaling more than $264 million -- a median of $931 per case.

The final Senate vote on health care is now set for 8:00 Christmas Eve morning.

And facing a solid wall of Republican opposition, what does the GOP have to offer besides opposition?

I'm going to ask Senator John Cornyn right after the break.

Also, Americans suspected of plotting terror in Pakistan are now speaking out and defiant, as one of them requests a death sentence.

Plus, Secretary of State Hillary Clinton, engaging in some holiday diplomacy.

(BEGIN VIDEO CLIP)

P.J. CROWLEY, STATE DEPARTMENT SPOKESMAN: This morning, the secretary departed Washington and, you know, she stopped at the North Pole for an important bilateral meeting with a well-known international figure.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

MALVEAUX: The Senate is closer than expected now to its Christmas Eve vote on health care reform. In just the past couple of hours, that vote was moved up about 12 hours, to 8:00 a.m. on Thursday.

Joining me from Capitol Hill is Republican Senator John Cornyn of Texas, who says if this bill passes, there will be a day of accounting.

Senator, thank you for joining us in THE SITUATION ROOM. I had a chance to talk to Senator Dick Durbin in the hour before. I know you guys struck a deal to vote for this earlier, as opposed to later, to allow families to get home for the holiday season.

Were you a part of that?

What did -- how did that take place?

SEN. JOHN CORNYN (R), TEXAS: Well, there were extensive conversations about how do we keep the time that we think we need in order to expose the deficiencies of this bill and, of course, the sweetheart deals that -- that produced it, but yet, you know, show respect for people and their families, let them get home at least in time for Christmas Eve.

And so I think it was a bipartisan agreement that resulted in this vote on -- on Thursday morning.

But I want to emphasize that this does not mean passage of this bill or signature by the president in its current form is inevitable. There's a lot of work that remains reconciling with the House. And, frankly, what my preference would, as you probably know, would be to stop this bill and start over and do some things that make sense, rather than make this massive government takeover of health care.

MALVEAUX: But what can do, as a Republican, right now besides stand in the way of this moving forward?

Is there anything you can do?

CORNYN: Well, it's not easy, because we only have 40 Republicans and there's 60 Democrats. So anything 60 Democrats decide to do, then they can pretty much run the place, as they can in the House under the majority leadership they have there.

But what we've tried to do is talk about what's in the bill and the things that I know my constituents are concerned about, things like a half trillion dollars in Medicare cuts, not to shore up Medicare, but to create another entitlement program; the tax increases on small businesses and middle class during a recession, when unemployment is about 10 percent; and then the fact that one of the consequences of the mandates in this bill -- central, controlled by the government of what kind of policies are permissible and which ones are not. Premiums actually are going to go up for many people...

MALVEAUX: But this...

CORNYN: ...so this is not really the kind of reform I thought we were all about.

MALVEAUX: But this is far from the -- from what it looked like before, when it first started. You don't have any public option in this bill. You don't have an expansion of Medicare. There are limits on abortion.

Is there nothing that you find in this bill that you can support? CORNYN: No. There are some elements of it; certainly, some of the wellness and prevention provisions and some of the delivery system reforms. There are some good things about the bill. But from a financial standpoint, it's a budget buster. And it's not the kind of thing we ought to be doing.

I -- I think that there are step by step approaches that would make more sense. You've heard a lot about cross state -- interstate purchase of insurance, letting people control what they want to buy and where they buy it, something that fits their needs; parity of tax treatment for employer-provided insurance and then that which you might buy if you're not covered by an employer policy; things like that which would help bring the costs down, which this bill does not do.

MALVEAUX: Those pre-existing conditions...

CORNYN: Those would be better.

MALVEAUX: ...the -- the reforms that the insurance companies will be subjected to, being able to -- to -- to offer insurance and not deny those with pre-existing health conditions, isn't that worth it enough to -- to put your support behind this...

CORNYN: Oh, there's...

MALVEAUX: ...that this would dramatically change the lives of so many Americans right away?

CORNYN: Absolutely. There's bipartisan support for eliminating the preexisting conditions exclusion. One of the ways we can do that is by making insurance not necessarily tying you down to an employer, to be able to buy insurance that you can afford.

But, yes, I'm -- that has bipartisan support. But this bill does a lot, lot more and that's why it costs about $2.5 trillion over a 10 year full implementation period. This is a massive government takeover of health care. And I think reducing individual choice and empowering the government and unelected, unaccountable advisory boards who are going to decide what kind of diagnostic tests, what kind of treatment that the government is going to pay for and, thus, that you may be denied.

MALVEAUX: All right. Senator, we're going to have to leave it there.

But thank you for joining us. And, obviously, have a good holiday with your family.

I'm glad that Congress could at least work that deal out.

CORNYN: Thanks, Suzanne.

Good to be with us.

MALVEAUX: OK. Thank you. Well, terrorists increasingly recruiting impressionable young men on the Internet.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Can I ask you how you stop this sort of social chatter that becomes radicalized, that is used for radicalization?

How do you sort of single that out?

UNIDENTIFIED FEMALE: I don't have a magic bullet for that. And I don't know that anybody does. This is the dark side and -- of the Internet and social media.

(END VIDEO CLIP)

MALVEAUX: One popular Web site in particular is the favorite new hunting ground for jihadists seeking new recruits.

Plus, a mixed race reality TV personality sparked a national conversation, exposing some disturbing prejudices in China.

(COMMERCIAL BREAK)

MALVEAUX: Secretary of State Hillary Clinton -- she may by taking her role just a little too seriously here. The State Department today announced an unscheduled mission by the secretary. A number of issues were respect discussed during her bilateral talks with, yes, Santa Claus. Rather than shuttle diplomacy, you can call it sleigh diplomacy.

Take a listen.

(BEGIN VIDEO CLIP)

CROWLEY: This morning, the secretary departed Washington. And, you know, she stopped at the North Pole for an important bilateral meeting with a well-known international figure. During the meeting, in a formal demarche (ph), sung to the tune of Twelve Days of Christmas," the secretary outlined her aspirations for the new year. They included -- and feel free to hum along -- open and accountable governments, Middle East negotiations, more civilians in Afghanistan, empowerment of women, fewer nuclear weapons, respect for human rights, resolution of historic grievances, treaties through the United States Senate, six party talks, dialogue with Iran, enough food for people of the world to eat, climate change legislation and lastly, a championship for the Boston Red Sox. OK. That last one's not on her list, but Harold Coe and I thought it important that we mention that here.

(END VIDEO CLIP)

MALVEAUX: I wonder how many she's going to get on that wish list that's going to come through -- Jessica, what do you think ?

You're monitoring all the other top stories coming into THE SITUATION ROOM -- hey, Jessica.

YELLIN: Suzanne, I sure hope there's video of the Clinton/Santa bilat, because, you know, we'd go to town with that.

MALVEAUX: Well, we may not believe it.

YELLIN: Right.

OK. Well, we've got a sad story now for you. At least four people are dead and more than a dozen injured after a suicide bomber walked into a journalists club in Peshawar, Pakistan. A police officer started to search the bomber just moments before he detonated those explosives. The club is on the main road into Afghanistan in an area that's considered by many to be the heart of Pakistan's war on terror.

Well, Colombia is denying that the country spent -- sent spy drones over neighboring Venezuela and the country's leaders are now in a war of words. President Hugo Chavez of Venezuela accused Colombia of sending an unmanned drone built by the U.S. over his country and he commanded his troops to shoot it down if they saw it.

But Colombia's defense minister says Chavez must have mistaken Santa's sleigh for U.S. technology. He says they did no such thing. The Pentagon has no comment.

All right, here in the US, there are teary good-byes at the funeral for Cincinnati Bengals receiver, Chris Henry. At the service for the NFL star, Henry's fiance told mourners that he changed her life. The NFL player died last week after he fell out of a pickup truck driven by his fiance. Police have not filed criminal charges in the case.

And a light story -- they tried it on Fifth Avenue. Now a store in Rome is using a live manikin to sell clothing. The Shirt Shop is using a male model. It's too early to tell if all that lying around boosted sales, but it's definitely getting attention.

I've got to take a look myself. I want to see. One shopper admitted, Suzanne, that she was embarrassed when she realized the man was real.

You've got to wonder, was she just staring a little too closely?

Oh, I see. Now I get it.

MALVEAUX: You can (INAUDIBLE), huh, Jessica?

YELLIN: Back to you.

MALVEAUX: Take your eye off the screen there.

All right. Five young Americans suspected of plotting a terror attack are finally talking and they seem to have no remorse. Our CNN team in Pakistan has the very latest, up next.

Plus, fireworks in a tiny town that might get prisoners from Guantanamo Bay. You're going to hear a commotion at a public hearing.

And Christmas at the White House -- it takes a lot of work, dozens of volunteers. And we're going behind the scenes of the holiday decorating for America's house, with HDTV's Genevieve Gorder.

(COMMERCIAL BREAK)

MALVEAUX: You're in THE SITUATION ROOM.

Happening now, hurdles are cleared and stall tactics fall by the wayside -- the Senate vote on health care reform moves up to Christmas Eve morning.

Well, it's supposed to be a time of good cheer, so why do more people die of heart attacks on Christmas Day than any other?

We'll ask Dr. Gupta.

And decking the White House halls for the holidays is no easy task. We're going to get the inside scoop on what it takes to make all of that happen.

Wolf Blitzer is off today.

I'm Suzanne Malveaux.

And you're in THE SITUATION ROOM.

There is movement today in the case of five U.S. nationals being held in Pakistan under suspicion of plotting terror. They apparently are now talking and their words are defiant.

CNN's Arwa Damon is in Islamabad.

ARWA DAMON, CNN INTERNATIONAL CORRESPONDENT: Suzanne, we're hearing now that those five U.S. nationals who were detained in Pakistan accused of wanting to carry out an act of terror are, in fact, going to be formally charged.

We spoke with Dr. Usman Anwar, who is the head of the investigative committee, who said that he was going to be recommending to the courts the five be charged under Pakistan's Anti-Terror Act with wanting to carry out an act of terror on Pakistani soil.

If they are found guilty, this could carry with it a life sentence.

He said that he had been in regular contact with the five as they were behind bars and that they appeared unremorseful, saying that they showed no regret whatsoever.

He quoted one of them as saying: "Do anything you want to us. Put us behind bars for life, but just put us together."

And he quoted as one of the young men as taking it a step further, saying: "Charge us with something that would lead to the detain sentence."

Now, if you'll remember, the five were picked up in the Pakistani city of Sargora (ph) after they went missing in the United States. Investigators had tracked their trail back in August. They had put up postings on the Internet, YouTube -- trying to reach out to militant groups in Pakistan before finally making their way here.

Authorities now believing that they fully intended to carry out a terror plot in this country -- Suzanne.

MALVEAUX: Arwa, thank you.

Now, that case is highlighting the surge in terrorist recruitment on the Internet and one popular Web site in particular.

Our CNN senior international correspondent, Nic Robertson, has more on that.

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Suzanne, for years, jihadists have been posting their radical videos on the Internet. But now social networking media, integrated into sites like YouTube, is making their radical recruiting easier.

(BEGIN VIDEOTAPE)

ROBERTSON (voice-over): It is as simple and scary as this -- YouTube videos as a connection between young men and gun-toting radicals.

BEN VENZKE, CEO, INTELCENTER: YouTube is sort of that -- could be that first hit for some people simply because of the mere scale and size of it. But it's going to be just that initial hit and then they're going to move on to deeper levels.

ROBERTSON: Pakistani police say it's exactly what happened in the case of five Americans arrested there last week. The police say the men, aged from 18 to 25, were on their way to terror training camps.

But why would an average youngster even look at a radical video?

PAUL CRUICKSHANK, TERRORISM ANALYST: A friend of mine encouraged a kid to look at a YouTube video. He visits the site, he sees the video is well produced, it's compelling. He sees lots of comments on the site, all of them in English. And soon, he starts commenting, as well.

ROBERTSON: After that, it's a very slippery slope, say terror experts. Extremists are watching online chats, looking for potential new recruits.

VENZKE: It sort of provides a filtering opportunity for them. They are able to sort of push out their message, see who responds to it.

ROBERTSON: It's getting the conversation and the videos together that's making the difference. According to CIA veterinarian Marc Sageman, no one ever got radicalized watching videos alone.

MARC SAGEMAN, FORMER CIA OPERATIVE: YouTube, the various videos at that post are very important in terms of seeing them. But then it's really discussing their significance with your friends that, in a sense, drives the point home, as opposed to just watching them.

ROBERTSON (on camera): What's making YouTube such a powerful tool for the Internet radicalizers is the built in social networking media. Look at this -- Revolution Muslim, an American group; 296 subscribers. Look at those subscribers here. We'll choose one of them, Lone Wolf, go into his account. He's posting his own videos supporting al Qaeda here.

Go down. We see his comments. Here, he's supporting the Fort Hood shooter.

And we go down even further and this is what worries the terror experts the most -- the conversations he's having with the other jihadists out there, this networking that's going on.

STEVEN SIMON, FORMER MEMBER, NATIONAL SECURITY COUNCIL: It's something, you know, very appealing for a kid to do who's looking at his menu of options when he's -- when he's seeking to rebel, when he's looking for that path out of his, you know, self-conceived terrible situation. And boom, you know, there it is.

ROBERTSON (voice-over): And online peer pressure works like anywhere else, only here, peers can be anyone, anyplace in the world -- new friends, a big appeal for alienated, isolated youngsters.

VENZKE: Suddenly they're not alone. They're going to do something that 20 other people, 100 other people have said yes, this is good, this is important and can be that pivotal point that pushes them over the line.

ROBERTSON (on camera): We contacted YouTube and a spokesman told us they have 20 hours of video uploaded every minute every day and more chats going on than they can monitor. They say the site bans incitement of specific serious acts of violence, but they can't stop the postings before they happen. They rely on users to police the site and flag offending material.

At Homeland Security, they don't have any simple answers, either.

JANET NAPOLITANO, SECRETARY OF HOMELAND SECURITY: I think that's fair to say the social media is having an impact. It is an illustration of how this is a changing environment.

ROBERTSON: Can I ask you, how you stop this sort of social chatter, that it becomes radicalized? How do you single that out?

NAPOLITANO: I don't have a magic bullet for that, and I don't think anybody does. It is the dark side of the internet and social media. I don't know, sitting here today, that anyone has a silver bullet for it.

ROBERTSON: And for anyone with teenagers on the internet, that has to trigger concern.

(END VIDEOTAPE)

ROBERTSON: And for anyone with teenagers on the internet, that has to be a concern. Suzanne?

SUZANNE MALVEAUX, CNN ANCHOR: Thank you, Nic.

A small town in the national spotlight over government plans to move terror detainees from Guantanamo to a nearby prison. We go inside as residents speak out.

Plus the future king of England sleeping on the streets of London? Details of Prince Williams' bone-chilling night.

(COMMERCIAL BREAK)

MALVEAUX: Jessica Yellin is following some of the other top stories here in THE SITUATION ROOM.

Hey Jessica. What are you working on?

JESSICA YELLIN, CNN CORRESPONDENT: More violence in Mexico, Suzanne. A family is brutally killed as they gather to honor a Mexican marine labeled a national hero. The marine's mother, two siblings and his aunt were shot to death. Police believe the hitmen may have been connected to the drug lord who was taken down by the marine during a recent raid. President Felipe Calderon called it a cowardly act.

Four long days of flooding have taken a toll on villages along the border of Thailand and Malaysia. About 500 families were evacuated in the region with homes and schools no match for rising flood waters. Nearby rivers continue to swell, forcing rescuers to get around by canoe, boat, even jet skis.

And check this out. Pictures prove that Britain's Prince William is not all talk. The prince recently spent a night on the streets to show the plight of homeless teens. Now, Prince Williams was joined by a British homeless charity that he's worked with for several years. You'll recall that in 1996, the then 13-year-old was exposed to life on London's streets when his mother, Princess Diana, took him to a shelter. The homeless was a big cause of hers.

Here's an odd one. A 13-year-old mixed-breed dog in upstate New York is the first pooch to have contracted the swine flu. Experts say the dog's owners took it to the vet after he suffered through h1n1 himself. A spokesperson for the Centers for Disease Control says animals can carry and spread flu viruses but because it's so rare, there's no reason for alarm. But we wish the pooch well -- Suzanne?

MALVEAUX: We wish him very well. Thank you, Jessica.

Well, they are the most prominent halls a designer can deck. We go behind the scenes at the White House and the massive task of decorating for Christmas with HGTV designer Genevieve Gorder. (COMMERCIAL BREAK)

MALVEAUX: Schools out, so first lady Michelle Obama, her daughters Malia and Sasha, even Bo the dog, are getting out of the house. They went to Children's National Medical Center to read to sick children today, and they took a few Christmas questions from the kids. Take a listen.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: How will the holidays be different for you this year?

MICHELLE OBAMA, FIRST LADY: How will the holidays -- what do you think, do you think the holidays will be different?

UNIDENTIFIED FEMALE: Well, um, it will be easier to get on the plane. But last year -- but I don't think anything will be very different.

OBAMA: Yes, we're doing the same things we usually do. Every year, ever since the kids were born and even before, we go to Hawaii that's where their -- where the president is from. So we go with a group of friends. So as soon as all the work here is done, we'll go there.

UNIDENTIFIED FEMALE: What did you get the president for Christmas?

OBAMA: Oh, I can't tell. They're going to tell.

UNIDENTIFIED FEMALE: It's really good, though.

UNIDENTIFIED FEMALE: It's good.

OBAMA: You know, we got him sports -- I got him sports stuff.

UNIDENTIFIED FEMALE: We got him --

OBAMA: Shh, don't say it. Just give the category.

UNIDENTIFIED FEMALE: I'm not. It's something he likes.

OBAMA: OK. Well, there you go.

UNIDENTIFIED FEMALE: How many Christmas trees does the White House have?

OBAMA: Oh, how many Christmas trees are in the White House? How many total are there? There are a lot.

UNIDENTIFIED FEMALE: OK. One, two --

OBAMA: No, wait, I think it's 24. I think -- where's my team? It's like 24 --

UNIDENTIFIED FEMALE: 26.

OBAMA: 26. See? I knew it was close.

UNIDENTIFIED FEMALE: Unfortunately we don't get presents under all of them.

UNIDENTIFIED FEMALE: What about the wishing tree?

OBAMA: There's one -- you want to talk about the wishing tree?

UNIDENTIFIED FEMALE: One of the tree says called the wishing tree, and it is made out of cardboard, and so you can write down a wish, and you roll it up, then you can put it in one of the holes and it might come true.

OBAMA: So that's a new tradition at the White House. So what we want you all to do next year is to come to the White House because you can see all of them. It's open to anyone who wants to come. You too.

(END VIDEOTAPE)

MALVEAUX: Decking the halls of the White House. No small matter. Volunteers swarmed the presidential mansion to help the Obamas spruce things up for their first Christmas there. Joining me now is Genevieve Gorder. She is the interior designer and host of HGTV's "White House Christmas 2009" which took a behind the scenes the look at what they did this year.

Genevieve, I know you were saying it was quite an honor. I've been to the White House several times. I've seen that tree that they're standing in front of. It is quite beautiful. They say they have 26 of those Christmas trees. What struck you when you went behind the scenes and saw what it took to decorate that house?

GENEVIEVE GORDER, HOST, HGTV'S "WHITE HOUSE CHRISTMAS 2009": You know I think it was just the amount of work and amount of people it takes to really facilitate this whole experience and it is a bevy of volunteers from around the country that are chosen by lottery to come and help decorate for a whole week straight. It's a very strategic and organized event as it needs to be or it would be a complete disaster with 26 trees.

MALVEAUX: So the first lady, what is her role in this? Does she bring her own Christmas decorates? Did she bring some from Chicago to hang the trees or what was her role in all of this?

GORDER: The first lady's role traditionally is that they come up with a concept for every year's Christmas theme and then hired in this case was Simon Doonan, a wonderful designer director to come in an orchestrate all of this throughout the week. So she this year chose rejoice, renew, and reuse. So a lot of the decorations from previous administrations and they were sent out all over the country to community groups to decorate so we have decorations coming in from every state in the country made by so many different kinds of groups representing different things. It is absolutely beautiful and it truly is the people's house, as the first lady says. You feel that when you walk in. The decorations are given by everybody.

MALVEAUX: I know that big special tree there that everybody's decorating, we've seen gorgeous pictures of it, that people from the community are able to hang their own ornaments. One year my cousin got to put his own ornament on the tree. How do they decide what is placed on the tree, where it goes, and who gets to be a part of it?

GORDER: I think that's a great question because I think we would all love a strategy to put a tree together but it isn't an exact science. It is very much a sculpture, and it tells you where it needs things. You have to keep standing back, looking, eyeballing. That's the job of the design director and this year's project it was Simon Doonan who is the design director at Barneys.

MALVEAUX: And Sasha and Malia, did you have a chances to see them? Were they actually around putting up decorations, looking at the gingerbread house?

GORDER: I wish I was drinking cocoa with the Obamas and decorated their tree all night long. However, they're rock stars, so it's really hard to get very close to them. I saw them running around, but their schedules are such that they weren't decorating all these 25 trees, but the one tree in their private quarters, that's the one they would be hanging the decorations on. That would be my dream, but in this case I got to hang with all the volunteers, and it was absolutely fabulous.

MALVEAUX: Looking at the style of how they've decorated the White House, is their style any different from previous administrations? What do you think the Obama family style is?

GORDER: I would say yes, I do think it is very different. I think we have a younger couple who definitely embraces a bit more of the modernity in the design, so less is more, and I think that's reflected very powerfully throughout all the rooms, the blue room included where that huge tree is that you mentioned. It just isn't over the top. I think that's also very representative of where we are right now as a country. Reusing things, not being excessive. It was beautifully executed, and really well done.

MALVEAUX: All right. Genevieve, we're looking forward to that special. Thanks for joining us here in THE SITUATION ROOM. Have a great holiday.

GORDER: Anytime. You too.

MALVEAUX: If you missed the HGTV White House special, you get another chance to take that insider's look at what goes into decorating for the holidays. HGTV is going to air an encore presentation of "White House Christmas 2009" this Thursday, Christmas Eve at 8:00 p.m. eastern.

Well, he was a 9/11 hero. That was just the cap of a very distinguished career. Now cloned puppies are carrying on his legacy of heroism.

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MALVEAUX: Just days before Christmas, tension is flaring between the Vatican and Israel, with a decision by Pope Benedict XIV to move a hotly disputed predecessor a step closer to sainthood. Our CNN's Kevin Flower is monitoring the developments in Jerusalem.

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KEVIN FLOWER, CNN CORRESPONDENT: It was a Vatican announcement guaranteed to spark controversy.

FATHER FEDERICO LOMBARDI, HOLY SEE PRESS OFFICER: With this decree, the pope says Pius XII is a person we have to admire, to recognize as a model of Christian virtues, and this is very, very important that the church gives officially these -- this appreciation of this important pope that we know was guiding the church in very difficult times.

FLOWER: The move by the sitting Pope Benedict XIV brings the controversial World War II pontiff, Pius XII a step closer to sainthood, this despite persistent allegations from historians and Jewish groups that he did not do enough to help prevent the murder of 6 million Jews at the hands of Nazi Germany. In Israel, the news has been met with a mixture of disappointment, bewilderment and anger.

RABBI YISRAEL MEIR LAU, CHIEF RABBI OF TEL AVIV: And with all the respect that we have to you, don't do it, especially not now when many survivors are still alive, and it will hurt them deeply, knowing that the man who could save and could do much more and did not do it. Don't make him holy.

FLOWER: The Vatican maintains Pius XII worked quietly behind the scenes to save Jewish lives during the war, but church archives that might shed more light as on his actions remain sealed despite repeated requests from historians for access. Earlier in the year, the German- born Benedict faced a wave of criticism for reinstating a holocaust- denying bishop who had been excommunicated for reasons unrelated to the holocaust, a public relations crisis the pontiff attempted to smooth over in his eight day visit to the holy land this past summer.

UNIDENTIFIED MALE: Every effort must be made to combat anti- Semitism wherever it is found.

FLOWER: Despite the outreach, tensions between Israel and the Holy See persist. Real estate disputes over rights and ownerships of Christian sites like this site where tradition holds Jesus held his last supper, and unresolved questions of Vatican tax liability have gone unresolved despite almost two decades of sometimes tortured negotiation.

DANNY AYALON, ISRAELI DEPUTY FOREIGN MINISTER: I will not deny that there are some misunderstandings and there's not yet a comprehensive agreement. But with good will with some creativeness on all sides, we will make it happen.

FLOWER: The sentiment echoed by the church's top official in Jerusalem.

UNIDENTIFIED MALE: This land, this holy land, teach us patience. And we must have patience.

FLOWER: A virtue that will be needed in surplus with misunderstandings both material and historical are to be overcome.

Kevin Flower, CNN, Jerusalem.

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MALVEAUX: A search and rescue dog from the 9/11 attacks is gone now but remembered with respect for his heroic feats.

UNIDENTIFIED MALE: He helped locate hundreds of people, recovered over $1 million worth of stolen goods. But the culmination of his amazing career is finding the last survivor at ground zero.

MALVEAUX: Trakr's legacy lives on, his inspiring story from our "Giving in Focus" series next.

Later, tensions mount on Capitol Hill as the Senate closes in on a Christmas Eve health care vote. If it passes what will be the political payoff? Or the political cost? You're in THE SITUATION ROOM.

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MALVEAUX: You're about to look inside the Illinois prison where the Obama administration plans to house dozens of terror suspects currently being held at Guantanamo Bay, Cuba. It is a controversial move and people who live nearby, they're speaking out very passionately about this. Our reporter Cheryl Jackson is in Sterling, Illinois.

And Cheryl, tell us what's happening there. Give us a sense of the scene.

CHERYL JACKSON, CNN CORRESPONDENT: Well, there are several hundred people still inside trying to convince the commission to vote their way. And the commission is expected tonight to vote on whether to close the prison and sell it to the federal government.

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JACKSON: All this commotion is about this place, Thomson Prison, state of the line but nearly empty, providing no income to the people who live here. The federal government wants to buy it and funnel an estimated $1 billion into this sleepy, struggling community over the next four years. They also plan to create 2,000 or 3,000 jobs. Who could have a problem with that? Joy Arrington does.

JOY ARRINGTON, ILLINOIS RESIDENT: I'm against it because I don't believe the terrorists should be on any U.S. soil, let alone Illinois property. JACKSON: About 100 detainees at Thomson will be transferred from Guantanamo Bay. Some believe those transfers come to Illinois with too high a price tag.

ARRINGTON: They brought down the World Trade towers. You're inviting nuclear warfare. They won't stop at nothing.

JACKSON: The Obama administration has promised to put a second security fence around the already super max facility. The guarantee all health care needed at Thomson Prison will happen on the property, no detainees at local hospitals. But security measures don't seem to be good enough.

ARRINGTON: My concern is not the prisoners getting out, it's you're making us a target for foreigners to attack American soil.

JACKSON: Others say a prisoner is a prisoner, the issue is the economy.

UNIDENTIFIED MALE: Losing our insurance, losing our houses. Just trying to put food on the table.

JACKSON: Brad Long is the president of the Northwestern Illinois Building and Construction Trades Council. He says unemployment in the construction business is higher than 30 percent in this area. The community's also in debt. That's because they built a new water treatment plant when the prison was constructed.

UNIDENTIFIED MALE: President of the United States went out in our backyard where we've got a state of the art facility that is not being utilized.

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JACKSON: Now the governor can override the commission's decision. The governor's decision can be challenged by technicalities -- Suzanne?

MALVEAUX: Thank you. Cheryl Jackson in Illinois, thank you.

Two days after the 9/11World Trade Center collapse, a German shepherd named Trakr found the last survivor buried in the rubble. Through Trakr, he died last year but he lives on in five cloned puppies. CNN's Christmas Day series "Giving in Focus," former journalist John Turagoi profiles the pups who will carry on Trakr's legacy.

(BEGIN VIDEOTAPE)

JAMES SYMINGTON, TRAKR'S HANDLER: We arrived at ground zero within 14 hours of the towers collapsing. K-9 resources were in short supply and we immediately began searches for survivors. Sometime late on the morning of September 12th, Trakr got a hit indicating that somebody alive was buried beneath the surface. Rescue workers later pulled a woman, the last survivor, from the rubble. And I'm extremely proud of the role Trakr played in her recovery. Trakr initially was trained as a police dog, trained to find live people, evidence, and drugs. He helped locate hundreds of people, recovered over $1 million worth of stolen goods. The culmination of his amazing career was finding the last survivor at ground zero. When I first met Trakr when we first started working together cloning wasn't even an option. It wasn't a consideration until one day I happened to see a TV report and they're talking about a cloning contest. In June I received not one but five amazing replicas of Trakr.

Come! Good boys!

I tried to choose a name to pay tribute to who Trakr was. There's Trust who is very focused. Solace who is extremely curious. Valor who is extremely courageous. Prodigy who is the problem solver. Extremely intelligent. And then there's Deja Vu who is the cuddler. He is the lover of the group, all extraordinary dogs. Meeting those puppies for the first time was amazing, it was moving. It was also bitter sweet. Sadly, Trakr passed away in April, peacefully at her home at the age of 16. I respect that cloning's not for everyone. I train, foster and rescue dogs. I strongly encourage anybody who can provide a good home for a dog to adopt a dog from a shelter or a rescue group. This is Trust. He's the oldest. Team Trakr's not about holding on to the past, it's about continuing a legacy.

I've launched the Team Trakr Foundation, an international, not for profit organization dedicated to providing elite canine search and rescue groups to the United States and around the world. In essence, canine teams with no borders. The launching of the Team Trakr Foundation is simply my way of continuing an extraordinary journey of one remarkable dog. And I owe Trakr that.

There's not a day that goes by that I don't think about Trakr. But I don't know if the puppies contribute to that or not. I just think he always had and always will have a special place in my heart. And these puppies, they're certainly going to complement that.

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MALVEAUX: You can learn more about Trakr's legacy at CNN.com/giving. Also more on his story and stories of other inspirational heroes in CNN's hour-long special "Giving in Focus" hosted by Tom Foreman. It airs Friday, Christmas Day, at 1:00 p.m. eastern with an encore presentation on December 26th at 3:00 p.m.

Happening now, the economic rebound loses some steam. We're going to make sense of a grab bag of financial reports. Whether Americans have hope for the New Year.

The Senate moves up its big vote on health care reform.