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THE SITUATION ROOM

Obama Will Be Briefed On Bombing Attempt Well Into The Night, As He Zeros In On How Fix Problems; Mourning Their Dead, Vowing Revenge; Biggest Blunders of 2009; Political Predictions

Aired December 31, 2009 - 18:00   ET

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


SUZANNE MALVEAUX, CNN ANCHOR: Happening now, the president is getting new and critical information about the failed Christmas terror attack. But the administration is not waiting to try to fill some of those gaping holes in security.

Plus, more reason to give up your vices in the new year. There are cities and states that are ready to slap you with all sorts of so- called sin taxes.

And the year began with an historical inauguration, but there have been some blunders along the way. The best political team on television looks back at 2009 and also shares some predictions for 2010.

Wolf Blitzer is off today. I'm Suzanne Malveaux. And you are in THE SITUATION ROOM.

Right now, President Obama is standing by to get more information from his national security team about the failed airline bomb attack on Christmas. Now he has set today as the deadline for early read on the failures in the system that he has called unacceptable.

Our Senior White House Correspondent Ed Henry is with the president in Hawaii.

Ed, what are the sources telling you about what the president is doing, how he is handling, and the kind of information he has gotten today?

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, Suzanne, they are suggesting he is getting near constant updates and some of the information already filtering in terms of preliminary findings from various intelligence agencies.

The deadline is actually midnight tonight, so he is still getting more information that will be coming in on here, on New Year's. And then he is supposed to spend the weekend going over it. Two big things to highlight. First of all, top aides are saying that one thing they are learning in the process is that very clearly there needs to be some sort of overhaul of these soc-called terrorist watch lists. There was clearly a breakdown in the case. That the eventual suspect should have been probably on a more restrictive list, like a no-fly list. He was not on that, he was on a broader database. That is not good enough. They are going to have to do some fixing there. Secondly, on the intelligence collection, in this case you see the CIA had some information suggesting that this eventual suspect had extremist ties, but didn't necessarily share with other agencies. It didn't make it around. That is a sort of pre-9/11 mentality that, as one top aide to the president said, quote this failure of sharing this information will not be tolerated by this president. So, it is very clear on those two issues, they are gaining a lot of insight, a lot of behind the scenes information they will try to use to fix the system, Suzanne.

MALVEAUX: And clearly, Ed, the president will be getting information, as you said, up until midnight. What is his next move?

HENRY: Well, going over this, we are told, and he gets back to Washington early next week. And we are told on Tuesday, as soon as he is sort of back in the office, he is going down to the White House Situation Room with some of his top adviser. The heads of the CIA, director of National Intelligence, the attorney general, Janet Napolitano, from Homeland Security. They are going to go behind closed doors on Tuesday and kick all of this around. Clearly a chance for the president, perhaps, to call some of these senior officials on the carpet for the failures, but also, we are told that the president really wants to focus on, how do we fix this? How do we learn from these mistakes to try to make sure the American people are safer, Suzanne.

MALVEAUX: OK, thank you, Ed. All important questions.

Now to the president's National Security team, the scramble to figure out what went wrong Christmas and, of course, how to fix it. Our Homeland Security Correspondent Jeanne Meserve is here.

And what are the new details you are learning today?

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: Well, they are already taking some actions. Homeland Security Secretary Janet Napolitano is dispatching two top deputies to meet with airport and other officials around the world, to discuss how to improve airport security globally. Officials say it could result in a ministerial meeting later in January.

(BEGIN VIDEOTAPE)

MESERVE (voice over): There is no new intelligence indicating an increased threat to aviation, but because this is a heavy holiday travel weekend, security is going to be even more enhanced. There will be more canine detection teams and more federal air marshals and requirements for 100 percent inspection of the passengers coming into the country remain enforce.

In addition the State Department is sending embassies around the world when you send a cable about a suspicious individual, include information on whether they have a visa. This is because cables about Umar Farouk Abdulmutallab did not mention the very significant fact that the 23-year-old had a valid multiple entry visa to enter the United States. Experts say the failures exposed by this episode will likely catalyze change.

FRANCES FRAGOS TOWNSEND, CNN SECURITY ANALYST: View this as an opportunity, it is a painful one, but view it as an opportunity to solve some of the things that have been stuck, in either the budget process, the policy process -- get things done.

MESERVE: Communication intercepts of extremists in Yemen in picked up between August and October discussed operations and someone called the Nigerian, and a partial name Umar Farouk. Umar Farouk Abdulmutallab, Yemen, extremism, all came to the attention of U.S. intelligence again the very next month, when the 23-year-old's father came to the U.S. Embassy in Nigeria, but no one made the connection.

MICHAEL CHERTOFF, FMR. HOMELAND SECURITY SECRETARY: I am sympathetic to the problem of what we sometimes call intelligence overload. So much information comes in, how do you separate what we call the signal from the rest of the noise? Often, it is very difficult to do.

MESERVE: There were other missed clues, British decision to deny him a visa; Abdulmutallab's cash purchase of a ticket, the fact that he didn't check luggage. Vague warnings about holiday attacks.

(END VIDEOTAPE)

MESERVE: As Ed Henry said, President Obama will meet Tuesday with top officials to discuss the preliminary assessments now being completed, but some experts are hoping for a longer-term, in-depth study to better understand the failures and better correct them.

MALVEAUX: So there is a lot of work to be done. Thank you, Jeanne, for your excellent work this week as well. Happy New Year.

MESERVE: Thank you. Same to you.

MALVEAUX: OK.

Happy New Year from North Korea, the Communist nation has issued a message hinting at renewed talks. The North says it remains committed to achieving a nuclear-free Korean Peninsula, through dialogue and negotiations. North Korea traditionally marks the New Year with a joint editorial in newspapers representing its Communist Party, the military, and it's Youth Militia Force. The annual statement is always closely examined for clues to the regime's policies for the coming year.

Well, you are now looking at live pictures. Just take a look, from Copenhagen, Denmark, and from Paris ringing in the New Year right now. CNN is around the globe as we welcome in the New Year 2010. We are counting down to the New Year, here, right on the East Coast of the U.S. Of course, just six hours away.

Another hour has passed, and 2010 just arrived in another part of the world. I want to go to our CNN's Josh Levs, he is watching all of this rolling into the CNN Center in Atlanta.

I'm envious, Josh. This is the best assignment - I did this one year and I just had a ball. You get to watch it all. What have we been looking at? What have you seen?

JOSH LEVS, CNN CORRESPONDENT: I am loving CNN's resources today. It is so great. I am totally with you there. In fact, because it just hit midnight, right, in parts of Europe. I am seeing Paris for the first time with you. Let's take a look at that one.

Not only does Paris have this huge light show that is going to be coming out of the Eiffel Tower, but it is also marking the 120th anniversary of the Eiffel Tower. So there are all of these people who have crowded in, some people have flown into France just to see what is happening there. You can see it is starting to kick off there with those giant lasers that are going around over and over, in Paris, packing in there.

And let's go to Copenhagen, too. Because there is beautiful video there. And you can see there is going to be some fireworks throughout there. Lots of people crowding into the streets, so much going on.

Now, we are following it all over the world, but I should also tell you, our folks on the ground in New York, have informed us that in Times Square, Suzanne, the ball has just gone up. And that is obviously exciting to a lot of people. So now all of the people on the streets are getting excited for what we know is coming in less than six hours, when the ball does its big drop. And obviously, people packed in there.

And as you mentioned, I've been following this throughout the day. So let me show you a couple of countries that are not live, right now, but that had for you earlier.

MALVEAUX: Yes, what are the best ones that you have seen?

LEVS: Well, last hour we looked at Sydney. I want to take you to two, we have a couple for you. We have the Ukraine, which is really neat to see. We can go to that one. We are also going to take a look at Taipei, Taiwan. Take a look at this. I mean, celebrations going on all over the world, all day. I have literally never seen so many fireworks in my entire life and I have been here for the last 12 hours watching them all day.

MALVEAUX: Unbelievable pictures.

All right. Looks like we lost Josh, but those are some amazing pictures and obviously, we are counting down for our own New Year's celebration here. Be sure to join us as we ring in the New Year tonight, with CNN's tradition, we have our own Anderson Cooper and Kathy Griffin live from Times Square. That countdown is starting at 11:00 p.m. Eastern. Join us tonight, because it should be a lot of fun.

Wherever you are, there are new laws and new taxes that are going to be introduced tomorrow. Three more states will ban texting while driving. One city is going to start taxing medical marijuana. And a smoking ban begins in one of the last places that you might expect.

Plus, is Nebraska getting special treatment when it comes to Medicaid? Why a number of other states are threatening now legal action.

(COMMERCIAL BREAK)

MALVEAUX: As the new year arrives, almost inevitably, so do new taxes and new regulations. Our CNN Kara Finnstrom is joining us from Los Angeles.

Kara, we are going to see some things changing in 2010, huh?

KARA FINNSTROM, CNN CORRESPONDENT: Yeah, a couple of things, Suzanne.

Americans who are texting while driving, lighting up in public restaurants, or maybe like the French fries extra crunchy, all of them may find that this year the government has a New Year's resolution for them.

(BEGIN VIDEOTAPE)

FINNSTROM (voice over): Across the country cities and states will usher in 2010 with laws and taxes aimed at limiting behaviors deemed unhealthy or unsafe. Texting while driving will now be banned in three new states, New Hampshire, Oregon, and Illinois. Bringing the total number of states outlawing the practice to 19.

Gloria Wilhelm fought for the Illinois law. Her son was riding a bicycle when he was struck and killed by a person downloading ring tones.

UNIDENTIFIED FEMALE: These are incredibly selfish, dangerous behaviors.

FINNSTROM: In North Carolina, a ban on smoking in most bars and restaurants, some might find noteworthy.

UNIDENTIFIED MALE: I find it rather annoying that they are going to turn me into the police.

FINNSTROM: The Tar Heel state is the country's largest tobacco producer with an economy deeply rooted in the leafy plant.

JUDY HENDRICKSON, SUPPORTS SMOKING BAN: I have allergies and any cigarette and tobacco, any kind of tobacco smoke are a real problem for me.

FINNSTROM: In California lawmakers want to clean up your diet. It is becoming the first state to partially ban the use of artificial trans fats in restaurants. Several fast food chains in cities have already taken trans fats off their menus.

Also in California, there is debate over whether medical marijuana is dangerous or unhealthy. But starting January 1st, Oakland will become the nation's first city to slap a sin tax on it.

REBECCA KAPLAN, OAKLAND CITY COUNCILWOMAN: While you are working on different budget strategies, here is one, you know, why not create a tax rate for the cannabis dispensaries? FINNSTROM: Ironically, the ranks of the taxes supporters include many medical marijuana advocates. They feel the tax legitimizes it.

Laws regulating America's vices are nothing new. But as we enter 2010, with cash strapped governments looking for additional revenue streams.

(PROTESTORS SHOUTING)

FINNSTROM: You can expect more of the debate Kentucky saw in 2009, when part of its economic lifeblood, whiskey, got taxed. 2010 brings a whole slew of potential new so-called sin taxes. One under consideration right now, a tax on the fake tan.

(END VIDEOTAPE)

FINNSTROM: You saw the protest there in Kentucky, over the new taxes on alcohol. Actually during the last year a number of states grappling with the budgets proposed similar taxes on alcohol, as well as cigarettes, and saw a number of those type of protests, Suzanne.

MALVEAUX: OK, Kara, thank you very much.

Well a group of state attorneys general throws down the gauntlet over a provision in the Senate health care bill, that gives Nebraska special treatment on Medicaid. They are threatening legal action over what they call the Nebraska compromise. Joining me now is CNN Congressional Correspondent Brianna Keilar.

Tell us what this is about, because they say this is not legal.

BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: They say that, and certainly what we know bottom line is that Nebraska is getting some special treatment here, Suzanne.

And here is why, because one the big parts of health care reform is an expansion of Medicaid to cover more Americans. And ultimately states will have to share in the costs of that, except for Nebraska, which you can see here in the bill, the Senate health care bill, it is singled out. This provision says that the federal government will pick up the entire tab for this one state, only this one state. Why?

Well, it has to do with Nebraska Senator Ben Nelson, he is that conservative Democrat who gave Democratic leaders their crucial 60th vote after stricter abortion language and also some of these sweeteners were added. But now what you have is state attorneys general, they are from 13 states, they are all Republicans. And they are saying, not so fast. They have actually sent a letter to Senate Leader Harry Reid and House Speaker Nancy Pelosi saying, we believe this is unconstitutional. And we are going to sue if this special treatment for Nebraska ends up in the final bill.

A spokesman for Senator Reid blasted this move saying that the Republicans are protecting insurance companies, and this is an attempt to distract from that. But bottom line, it is a political battle. Health care reform is going to be a big issue in the upcoming mid-term elections. And both sides, Suzanne, sharpening their knives, it is fair to say.

MALVEAUX: And, Brianna, obviously, there was a lot of politics that went into getting that Senate portion of the health care reform bill passed. Do you think he is going to pay for this, Ben Nelson, in 2012, when he comes up for re-election?

KEILAR: It is certainly going to be an issue. And he clearly knows that, because he is on the defensive. He is trying to explain himself to Nebraska voters. Check out this ad that ran last night, during the Holiday Bowl, Senator Nelson taking advantage of the fact that the University of Nebraska was playing this year, and he had a bit of a captive audience.

(BEGIN POLITICAL AD CLIP)

SEN. BEN NELSON (D) NEBRASKA: With all of the distortions of health care reform, I want you to hear directly from me. Some oppose any change, others want a government takeover, but I listened to you and took a common sense approach to improve the bill.

(END POLITICAL AD CLIP)

KEILAR: This is part of a 30-second ad paid for by the Nebraska Democratic Party. While many liberals are mad at Ben Nelson for pulling the Senate health care bill farther to the right, the fact is he has also infuriated many Republicans. He could be very vulnerable in 2012.

MALVEAUX: OK. We will keeping a close eye on all of the developments out of the health care reform bill starting in January, huh?

KEILAR: Oh, we have our work cut out for us.

MALVEAUX: It starts again. Glad you are doing it. Thanks, again.

A fresh sign today that the economy actually is healing. The Labor Department reports that jobless claims by newly laid off workers dropped last week by 22,000. Now, the figure of 432,000 new insurance claims is the lowest since July of last year. Economists expected an increase.

Now, continuing claims for benefits also dropped to 4.9 million. The new claims are seen as way to measure of pace of layoffs, and the willingness of companies to hire new workers.

For many, it is a lost decade. Investors might feel like they should have sat this one out. On New Year's Eve in 1999, the Dow Jones industrial average closed at 11,497. Well, it has been a roller coaster ride since then. But this year the Dow closed more than 1,000 points lower at 10,428.

Now unemployment, just forget about it. Ten years ago the jobless rate was 4 percent. The most recent figures show it now at 10 percent. And don't look to your home as an investment. Back in 1999, the median home price was about $137,600. Now, it is $172,600, but given the effective inflation, real prices are actually 3 percent lower than they were a decade ago.

Well, a last-minute decision impacting hundreds of airline pilots who carry guns in the cockpit. Details of a sudden change by the Homeland Security Department.

Plus, a surprising appeal from one of the country's best-known pastors. What Rick Warren is asking of his congregation.

(COMMERCIAL BREAK)

MALVEAUX: Brianna Keilar is monitoring some of the other top stories in THE SITUATION ROOM. You get to be here at the table after your last story.

KEILAR: This is always very fun. We have a lot of headlines to tell you about.

First of all, Montana now the third state in the country to allow physician-assisted suicide. Montana supreme court ruled that there is nothing in state law to prevent patients from seeking the procedure. Advocates say this clears the way for doctors to prescribe the necessary drugs to mentally competent, terminally-ill patients.

And Evangelical Pastor Rick Warren is asking his parishioners to bring the church out of the red to the tune of $900,000. A letter to members of his California mega church says that the bottom dropped out when the Christmas donations were less than half of what is normally received. Warren, as you may recall delivered the invocation at President Obama's inauguration. He is also the author of a number of books, including the well-known book "The Purpose Driven Life."

And health officials say the autumn wave of H1N1 flu is declining. Widespread incidents of the illness were reported in only four states last week, down from seven the week before. Reported infections have been dropping since a peak in late October. The CDC says that the H1N1 vaccine is getting easier to find and people should still get vaccinated, because there could be another wave this winter.

AT&T ending its business relationship with Tiger Woods. The telecom giant hasn't used the golfer's image extensively, but its logo has appeared on his golf bag. Woods signed a multi-year dealt with AT&T in February, but the terms were not disclosed. This is the second major sponsor to drop Woods since his November car crash and subsequent admission of marital infidelity. Certainly he is paying dearly for this, appears.

MALVEAUX: And you are a golfer, aren't you, Brianna?

KEILAR: I am a golfer.

MALVEAUX: Are you a good golfer? KEILAR: I'm OK. I'm all right. I'll say that, I'm OK. And I certainly have enjoyed watching Tiger Woods play. But you know that AT&T national tournament, so it is sort of -that is actually here in our backyard some of the time. It is going to be interesting to see if that is still going.

MALVEAUX: And that is still going to happen?

KEILAR: Yes, we understand it is, but long-term, it makes you wonder.

MALVEAUX: Well, maybe I will come watch your golf game sometime.

KEILAR: I will teach. I'll teach you sometime,

MALVEAUX: OK, I don't know how to golf.

KEILAR: You are athletic, you can do it.

MALVEAUX: OK, thanks.

Well, the Taliban are now claiming credit for new American deaths in Afghanistan. The target, a crucial CIA post, described as a hub of activity.

Hundreds of U.S. pilots get the go ahead to keep carrying guns, permission to protect the planes they were actually about to lose.

(COMMERCIAL BREAK)

MALVEAUX: Happening now, another layer of security is extended. Just hours before their certificates were to expire, airline pilots are getting new word about their firearms.

A substantial loss for the CIA, the Taliban is taking credit for a deadly attack in Afghanistan.

And looking back at a year of blunders. Our political team weighs in with their top picks.

Wolf Blitzer is off today. I'm Suzanne Malveaux, and you are in THE SITUATION ROOM.

Well, it looks like a dispute over whether or not some members of the airline flight crews are still authorized to be armed in the cockpit has been averted, at least for now. The Department of Homeland Security has extended certification for some whose permits were actually about to run out. Joining me in THE SITUATION ROOM is our own CNN's Brian Todd.

So, kind of explain what all of this means. How did it happen, Brian?

BRIAN TODD, CNN CORRESPONDENT: Well, Suzanne, all over the country, there are airline pilots known as federal flight deck officers. They volunteer for training so they can carry weapons to protect their planes. Just hours from now, at midnight Eastern time, hundreds of those flight deck officers were going to lose their certification to carry firearms because they have not undergone the retraining program they were required to.

This would have come at a heightened time -excuse me at a time of heightened concern because of the attempted airline bombing last week. But this afternoon the Department of Homeland Security extended permission for those pilots to carry their weapons. A TSA official said, certifications were extended for six months, quote, "in light of recent events". This official said that due to an internal miscommunication those pilots were given notice prematurely that they would lose their certification, but for now several hundred flight deck offices can carry firearms until they get that critical retraining, Suzanne.

MALVEAUX: So, why didn't they just go back -why didn't those pilots get retrained in the first place?

TODD: Several of those officers contacted by CNN said it is just too tough to get to the classes. The size and the number of classes were limited. Also they said they had to pay their own way. They had to pay for food and lodging although the training was free. And another snag they ran into by law the airlines were not allowed to pay them during this training, so it was kind of on their own dime. It was just tough to get to the training sessions.

MALVEAUX: Thank you, Brian.

Well, a day after the devastating attack on an American base in Afghanistan, U.S. Intelligence officials are vowing revenge, as they also mourn their dead. We want to go live to the CNN Pentagon Correspondent Chris Lawrence.

And really, Chris, this seemed to be a stunning blow for the intelligence community. Just unbelievable when you saw this.

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: Exactly right, Suzanne. That has been the reaction from intelligence officials. The Taliban claim that they got an Afghan army soldier to put on a suicide vest and he blew himself up inside of the American base.

Now, the CIA is not commenting, but The AP reports that one of the seven officers killed was the chief of the base.

(BEGIN VIDEOTAPE)

LAWRENCE (voice over): Unlike their military counterparts in Afghanistan, CIA workers serve in the shadows, their names are unknown to most Americans. Some gather intelligence, and others analyze the intel, or recruit Afghans to the American side.

Now, seven are dead, and six wounded, and a U.S. intelligence official is promising revenge. Quote, "This attack will be avenged through successful, aggressive counterterrorism operations."

On Wednesday, a single suicide bomber got onto this American base in Eastern Afghanistan. A U.S. official described it as a crucial base where the CIA monitored the Pakistani border and conducted intelligence operations. FRANCES FRAGOS TOWNSEND, CNN NATIONAL SECURITY CONTRIBUTOR: Even going back as far as 2004, Khost was a very active forward operating base because of its proximity to the tribal areas of Pakistan.

LAWRENCE: CNN contributor Fran Townsend visited the base as President Bush's homeland security adviser. She says it was targeted because it's not a military base.

TOWNSEND: I believe that this was a very deliberate strategy on the part of the Taliban to push back on President Obama's strategy to increase the number of civilians and increase the civilian component.

LAWRENCE: President Obama recently announced a civilian surge to train more forces and improve living conditions in Afghanistan. Thursday, he wrote a letter to all CIA workers honoring those who died and telling others: "Your triumphs and even your names may be unknown to your fellow Americans, but your service is deeply appreciated."

(END VIDEO TAPE)

LAWRENCE: It's not only a personal loss for the officers' families, but the U.S. loses their expertise in that part of Afghanistan. And if this bomber was wearing an Afghan Army uniform, investigators are going to have to determine whether it was stolen or, even worse, whether this was an Afghan soldier who was secretly working for the Taliban -- Suzanne.

MALVEAUX: Very serious concerns.

Thank you, Chris.

Well, it's been an especially bloody year in Afghanistan, where 312 U.S. troops were killed in the last year. That's twice as many as the year before. A total of 513 coalition troops died in the past 12 months -- the bloodiest year since the war began. Since 2001, more than 1,500 coalition troops have died in Afghanistan, from 24 countries.

In Iraq, 149 American troops have died this year. That's less than half of the number of the year before. Since the start of the war in Iraq, 3,477 U.S. troops have died in combat.

Well, manslaughter charges have been dismissed. It's a surprising new development in a notorious incident from the Iraq War. Five men who worked as security guards for the military contractor, Blackwater, were accused of killing 17 Iraqi civilians and wounding dozens of others in a Baghdad square in September, 2007. Well, the guards said they came under fire. But the Iraqi government called these shootings unprovoked.

Today, a federal judge dismissed all the charges, saying that the government prosecutors wrongly accused the men -- used the men's statements against them.

A New York landmark falls on hard times -- a restaurant known around the world for decades serves its final meal. And the biggest political blunder of 2009 -- there are plenty of them and each member of our political panel has got a favorite.

(COMMERCIAL BREAK)

MALVEAUX: Brianna is back.

Brianna Keilar is monitoring the other top stories in THE SITUATION ROOM.

What are you following -- Brianna?

KEILAR: Well, Suzanne, an Afghan military official says two French journalists and an Afghan translator have been kidnapped. The official says the three were on their way from Kabul Province to Kapisa Province. A statement from the French foreign ministry indicates there was more than one Afghan with the journalists. The French defense minister says no group has claimed responsibility as of yet.

Police in Hemet, California are investigating a pretty suspicious development at one of their unmarked buildings. Police say they discovered someone created a way to deliver natural gas into the building, add a spark and police say the building would have been blown up. The building has been used by the police gang task force for the past five years. Police are treating the house as a crime scene and they are investigating.

He's the inspiration for the district attorney in television's "Law and Order" and after 35 years in office, Robert Morgenthau is finally stepping down. Today is Morgenthau's last day as Manhattan's district attorney. During his career, his office has prosecuted terrorists, mobsters, celebrities and also Wall Street swindlers. At age 90, Morgenthau says he's not sure what he'll do next.

Also in New York, it's the restaurant known around the world and tonight it's serving up its last meal. New York City's Tavern On the Green was once America's highest grossing restaurant, but the restaurant couldn't avoid bankruptcy, being $8 million in debt. The restaurant first opened during the Depression. A legal battle is underway over whether a new owner can use the name Tavern On the Green.

And I understand it could become Tavern In the Park. It's not...

MALVEAUX: In the Park?

KEILAR: I don't know, it's not the same ring, is it?

MALVEAUX: No, it does -- it doesn't have it. I think I saw you in one of those pictures, though. It's somewhat of a hipster spot (ph) in New York, as I know.

KEILAR: I've been there a couple of times, as have you.

MALVEAUX: Yes, indeed. All right, thanks, Brianna.

KEILAR: Of course.

MALVEAUX: I want to go to straight to John Roberts and Kyra Phillips, who've got the next hour ahead -- hey, guys.

JOHN ROBERTS, HOST, "CNN TONIGHT": The next couple of hours, actually.

MALVEAUX: Oh, good.

ROBERTS: Thanks, Suzanne.

Coming up at the top of the hour, President Obama is summoning the heads of his intel agencies for a big meeting next week. He's getting his first look at a review of the failed Christmas Day airline bombing. The CIA being criticized over that terror plot; also dealing with a serious tragedy in Afghanistan. Seven of its CIA agents were killed in a suicide car bombing. We'll talk to two former CIA agents about the situation there.

KYRA PHILLIPS, CNN ANCHOR: And we're also saying good-bye to 2009 all over the world. Massive celebrations already kicking off, along with a massive security concern, particularly in New York City. It's expecting up to a million people in -- with crowds all around the world coming to the famous Times Square. We're going to take you live to the streets of Manhattan, where they're counting it all down.

So join us for all that and more right here at the top of the hour.

ROBERTS: See you then.

MALVEAUX: All right. Thanks, guys.

We'll be watching.

A very big year in politics -- so what were the biggest blunders of 2009?

The best political team on television is standing by with their picks.

And who needs a corkscrew when you have a cork shoe?

Our CNN's Jeanne Moos takes a Moost Unusual look.

(COMMERCIAL BREAK)

MALVEAUX: So what were the biggest political blunders of 2009?

Well, let's ask our best political team on television -- our CNN senior political analyst, Gloria Borger; conservative columnist Terry Jeffrey, editor-in-chief of the conservative news Web site, CNSNews.com; Democratic strategist Mo Elleithee; and CNN senior political correspondent, Candy Crowley.

Happy New Year's to all of you guys.

(CROSSTALK)

MALVEAUX: Yes. Yes.

Let me start with you first, Gloria.

The biggest blunder, do you think, of 2009?

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Well, there are lots of blunders I can think of. But during -- given current events, a blunder that I thought about was the president deciding to set a deadline for closing Guantanamo. Obviously, in politics, it's always difficult to set a deadline when you're not going to meet it. Originally in an executive order, as you know -- you covered the White House -- the president set January 22nd as the deadline. It's soon to be January 1st and we know that that's going to be delayed. And now in particular, given the problems we've got with the folks who are left at GITMO -- half of them are -- are from Yemen. The plan was to repatriate them back to Yemen. And now, there's going to be a big political problem with doing that. Lots of members of Congress are saying no way.

MALVEAUX: Terry?

TERRY JEFFREY, EDITOR-IN-CHIEF, CNSNEWS, CONSERVATIVE COMMENTATOR: The biggest blunder may be a national security problem, too. I think the biggest blunder, Suzanne, was President Obama coming out with his first budget. The Congressional Budget Office scored it. They looked out 10 years into the future. They said it will add $7.1 trillion -- trillion with a T -- to the national debt over the 10 -- the next 10 years. That means we're going to have average annual budget deficits of $700 billion a year. The biggest one we ever had before this year was $458 billion. Last year under President Bush, who conservatives went after because he spent too much money and ran up big deficits. You have a grassroots movement growing in this country of people who are angry at big government, angry at deficit spending. I don't see President Obama digging himself out of that hole he's already dug.

MALVEAUX: Mo?

MO ELLEITHEE, DEMOCRATIC STRATEGIST: You know, any sex scandal is a blunder. But Mark Sanford's was absolutely bizarre. You know, this is a guy who was...

BORGER: It's too easy.

ELLEITHEE: But it was a pretty big blunder. It was a pretty big one. This is a guy who was a conservative darling, one of the leading voices in opposition to the president. He was seen as a frontrunner for 2012, chairman of the Republican Governors Association. And then he disappears for days, says he's hiking on the Appalachian Trail.

And the fallout, I thought, was immense. This is a guy who not only had major implications in his home state, but probably on the 2012 presidential field. And it's a textbook case on how not to handle a scandal.

MALVEAUX: Candy?

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Well, let me be an economist first because this is a on the one hand, on the other hand blunder. If Sarah Palin, the ex-governor of Alaska that wants to run for president, she made a blunder by being the ex-governor of Alaska. I haven't talked to a Republican, save a couple, who have thought it was a good idea, simply because what is the main rap on Sarah Palin?

The main rap is she doesn't have enough experience. We had a poll -- 70 percent -- more than 70 percent of people don't think she has the experience necessary to be president and she quit in the middle of her term. It's also not a great message -- I really want to be elected, but I might not hang in there for the long run.

On the other hand, if Sarah Palin doesn't want to run for president, she made a great choice because she is, as my kids would say, making bank and doing quite well.

BORGER: Big time. Yes.

CROWLEY: Yes.

MALVEAUX: I -- I think, for me, the blunder was, you know, a part of the campaign -- the Obama campaign, you had rock star status. You had the cult of personality. You had thousands of people that were part of these rallies. And they had so much information on the BlackBerrys, the texting. They had information on all these folks. They were going to mobilize the young people, the people around the country to get what they wanted to get done in terms of the policy.

I -- I just think it's such a missed opportunity (INAUDIBLE) you have the -- the Tea Party rallies. You have the protesters against health care. And you just didn't see the Obama administration -- the government rallying who they inspired during the campaign and turn it into some real support for their policies. So we'll see what happens the next go around.

We've got a little more time for any other blunders if you guys are just adamant about things that went wrong this year.

BORGER: Well, I'd just say that some of those people that you're talking about in the grassroots are probably now disenchanted with the president, right?

So it might not be so easy to mobilize them as it might have been like a year ago.

MALVEAUX: I'm still getting those texts, though. I'm still getting the texts from the Obama administration saying, Suzanne, we've just done the following, you know?

BORGER: Aren't we great?

MALVEAUX: Yes. Exactly. Any other -- any other blunders...

ELLEITHEE: And I think...

MALVEAUX: ...you guys are...

ELLEITHEE: I think you -- just to sort of add on here you have to put John Ensign...

JEFFREY: Yes.

ELLEITHEE: ...on top of that, yet another up and coming Republican. I mean I -- really, they all -- well, you know, Stanford and Ensign both came in in January. Oh, here are the up and comers, here's the new face of the Republican Party. Now they're toast.

MALVEAUX: All right. Enough of the blunders for now.

And, guys, hang with me here.

We're going to look ahead to 2010 and get some predictions for this Congressional election year.

(COMMERCIAL BREAK)

MALVEAUX: So what will the new year hold for the world of politics?

We're back with the best political team on television -- Gloria Borger, Terry Jeffrey, Mo Elleithee and Candy Crowley.

We're going to turn it around to some predictions, Gloria, starting with you.

BORGER: All right. I'm going to go out on a limb here, OK, Suzanne?

I'm going to say, of course, that President Obama will end up signing a health care reform bill in 2010. It's not going to be the bill he originally wanted. It's not going to contain the public option and it's not going to give him the boost in the polls that he initially anticipated. But he will be able to say that health care reform passed through Congress on his watch.

MALVEAUX: Terry?

JEFFREY: I'm going to predict what could have happened this year that I very much hope doesn't happen. But I do believe that this could be the most consequential year since the mid-1930s for the role of the federal government in American lives.

Since FDR and the New Deal created Social Security, created a welfare state in America and massively expanded the role of the federal government, we haven't seen an agenda like the one President Obama and the Democratic Congress want to put through.

It starts with the health care bill. It then goes to the Cap-and- Trade bill that already passed the House. It may not pass the Senate, which would put a serious crimp in U.S. industry and manufacturing jobs.

They also want to do an amnesty for illegal aliens. There's anywhere from 12 to 20 million illegal aliens. It that amnesty goes through, it could fundamentally change the nature of national politics in this country, because such a high percentage of those folks are likely to vote Democrat.

This could be the most consequential year for federal policy in more than 50 years.

MALVEAUX: Mo, can you top that?

ELLEITHEE: Well, you know, we'll see. In 19 -- anything can happen in a year in federal politics. And I think with the passage of health care and as the economy continues to rebound, we'll see a very different political environment a year from now, one that -- that could be a lot more favorable to the Democrats than it might be today.

But where I think there are real opportunities for Democrats going into 2010 is out in the states, in the governors' races. Right now, three of the four biggest states are governed by Republicans. In California and Florida, Democrats are looking very strong. Texas is suddenly looking like it could potentially be a competitive governor's race. Out West, you've got Arizona and Nevada, Hawaii, where the Democrats have real opportunity. Up in New England, there are a couple of states. Those would all be Democratic pickups.

So I think there are some real opportunities out there.

MALVEAUX: Candy?

CROWLEY: Gloria, obviously, was right. He may -- he will get health care. But after that, it gets hard. The president wants financial reform -- a reform of the financial markets. He will get financial reform light. As he moves on to another big thing in his agenda -- and that is energy reform, Cap-and-Trade -- that is, making polluters pay if they pollute beyond a limit, I think that goes down. So his -- his -- the financial reform lite will be a -- a big deal, as will be a rejection, I think, of Cap-and-Trade.

MALVEAUX: I agree with you. I think one of the things that we're going to see is he's finally going to be dealing with the national debt. You've got a $12.1 trillion national debt. And I think that there's a bipartisan effort -- not only the White House that's facing pressure, but you've got Republicans and Democrats who are all looking -- at least 34 Senators now, at the last count, of some -- creating some kind of commission or task force, if you will, to make the recommendations for those spending cuts or for raising taxes; that that is something that they are going to have to finally get their arms around. And I think that that's going to be something, in additional to the health care reform bill...

BORGER: They have to do that because of Terry's prediction, which is that they understand that people don't like big government and they see the administration raising the deficit -- raising the debt ceiling. And so the administration understands it has to be proactive on this.

JEFFREY: What some people may forget, Gloria, is the Bush tax cuts go away after next year no matter what, unless Congress renews them. There -- that $7.1 trillion in deficit -- in debt, that -- that is calculated assuming that the Bush tax cuts go away and everybody gets an income tax rate across the board.

CROWLEY: I think it's going to...

(CROSSTALK)

CROWLEY: ...it's going to be interesting to watch this dance, because if they set up this commission, as they're talking about, and if they set up people to tell Congress where to make the cuts, I just think people are going to laugh out loud -- the stop me before I spend again Congress. I mean they will get a lot of heat for that kind of solution.

JEFFREY: Well, the bottom line is this -- this country faces bankruptcy if we don't deal with government spending run amok. We face $56.4 trillion in unfunded liabilities against the PA -- according to Peterson Foundation. It is a real problem. It must be dealt with.

BORGER: And it's essentially saying that Congress has abdicated its responsibility, that Congress can no longer decide to make spending cuts. But -- but, of course, the problem is people in Congress, particularly people like House Speaker Nancy Pelosi and Harry Reid, they don't want to get rid of their power.

(CROSSTALK)

BORGER: Right?

MALVEAUX: We've got to leave it there.

Everybody, have a very happy New Year.

BORGER: You, too.

MALVEAUX: All of you.

ELLEITHEE: The same to you.

(CROSSTALK)

MALVEAUX: OK. Maybe we'll see you again tomorrow.

Well, if you're ready to ring in the new year, but, uh-oh, you forgot the corkscrew, well, we're going to show you this and other most unusual fallback methods for uncorking a wine bottle.

And the Miracle on the Hudson and other 2009 Hot Shots, when we come back.

(COMMERCIAL BREAK) MALVEAUX: On our Political Ticker, President Obama visits a strange new world. The first family and friends saw the film "Avatar" today. They went to a movie theater near their rented vacation home in Hawaii. The president, who describes himself as a movie buff, went all out seeing the 3-D version of this futuristic adventure film.

Well, the governor of Nevada has fired a campaign adviser for describing first ladies as "window dressing." Republican Jim Gibbons apologized for the adviser's remark, saying it was demeaning, sexist and not a reflection of his own views. Gibbons says -- and his wife divorced this week and his adviser apparently was trying to apparently downplay the impact of that, suggesting that having a first lady at the governor's mansion was merely window dressing that wouldn't be missed.

As Americans get ready to ring in the new year in Times Square and across the nation, our new poll shows that they're less hopeful than they were a decade ago. At the close of 1999, 85 percent of Americans said they were hopeful about their own futures. But in our brand new CNN/Opinion Research Corporation poll, 69 percent of Americans now describe themselves as hopeful about their lives.

Well, it's customary to usher in the new year with a flute of champagne or a nice glass of wine.

And for that, of course, you need a corkscrew -- or do you?

A Frenchman has become an Internet sensation for the most unusual talent -- uncorking a wine battle -- bottle with his shoe.

Here's CNN's Jeanne Moos.

(BEGIN VIDEO TAPE)

JEANNE MOOS, CNN CORRESPONDENT (voice-over): He may not be the world's greatest wine connoisseur, but this Frenchman sure knows how to pop his cork -- and we don't mean the usual way. We mean without a corkscrew. Call it the cork shoe technique.

(VIDEO CLIP)

MOOS: He's the toast of the Internet for his sure-footed effort to open what surely wasn't the first bottle of the night. Go ahead and laugh, but 20 seconds later, this Frenchman had that bottle uncorked.

(VIDEO CLIP)

MOOS: His feat is the subject of Internet instruction.

UNIDENTIFIED FEMALE: How to open a wine bottle without a corkscrew. Step one, stick a screw into the cork.

MOOS: Ranching from using a screw and a hammer to a hammer and a beater from a mixer, though that method ended in the cork being shoved...

UNIDENTIFIED FEMALE: All right!

MOOS: ...inside the bottle. Others recommend using a Sharpie. This method is best if you're planning on polishing off the whole bottle. If caught without a corkscrew...

UNIDENTIFIED MALE: Pull up.

MOOS: ...a wine professional might resort to a tree...

(VIDEO CLIP)

MOOS (on camera): Or you could try using the phone book.

Who says the Internet has made the phone book obsolete?

Try doing this with a laptop. You know, a nice red goes very well with these yellow pages.

(voice-over): Funny, when they did it, it looked so easy.

(on camera): Do you think it's because it's cheap wine?

UNIDENTIFIED MALE: Nada.

MOOS: I'm exhausted.

(voice-over): So my producer, Richard Davis, took over. Champagne corks are much bigger and easier. Even sword play works.

UNIDENTIFIED MALE: Hey.

MOOS: But here's a method that leaves you more screwed than a corkscrew.

(VIDEO CLIP)

MOOS: We tried whacking the floor.

(VIDEO CLIP)

MOOS: We tried the bottle in boot technique, but the cork wouldn't budge.

UNIDENTIFIED FEMALE: Eighty-five percent of the world's wine corks come from Portugal.

MOOS: Yes, well, ours was the cork from hell.

UNIDENTIFIED MALE: This is really frustrating.

MOOS: Jeanne Moos, CNN, New York.

(END VIDEOTAPE)

MALVEAUX: Well, here's a look at some of the best and most memorable Hot Shots of the year, brought to you by our friends at the Associated Press.

Kicking off 2009 was the amazing emergency landing of a U.S. Airways plane into New York's Hudson River.

In Boston, President Obama hugged Victoria Kennedy as the country said good-bye to Senator Ted Kennedy.

In Afghanistan, the fighting raged on as this U.S. soldier woke up from a sound sleep and fought in his boxer shorts.

And in Germany, dominos fell along the former border near the gate marking the 20th anniversary of the fall of the Berlin Wall.

Hot Shots -- pictures worth a thousand words.

I'm Suzanne Malveaux in THE SITUATION ROOM.

Have a great New Year's Eve.

Up next, "CNN TONIGHT".