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ANDERSON COOPER 360 DEGREES

"Don't Ask, Don't Tell" Vote Fails; Pres. Obama's Tax Cut Drama; Bachus Bucks; Financial Reforms Under Fire; Prosecutorial Misconduct; Cheating Kids Out of an Education

Aired December 9, 2010 - 23:00   ET

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


(COMMERCIAL BREAK)

ANDERSON COOPER, CNN HOST: Tonight the bill to end "don't ask, don't tell" dies. But what happened? Sixty senators say they support repeal, so how come they didn't vote that way? We're "Keeping Them Honest."

Also tonight: the latest on the wrangling over the tax deal and a little known piece of legislation that might be attached to it. Senate Majority Leader, Harry Reid doubling down and trying to force a bill to legalize online poker on to a legislative plate he already says is overflowing. Four years ago he was against it, now he's for it. So what happened?

And tonight, did you know Congress's incoming head of financial oversight, the guy who is supposed to be protecting you against big banks and credit card companies? It turns out he's the biggest recipient of money from the financial industry. Is that a conflict? We're "Keeping Them Honest."

We begin as always, though tonight, "Keeping Them Honest," with the dramatic vote on and likely death of the bill that would repeal "don't ask, don't tell." It was dramatic because there are 60 senators who say they want to repeal "don't ask, don't tell" and 60 is the number needed on a procedural vote like this.

So why did it die today? Well, in a word, politics.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: The yeas are 57, the nays are 40. Three fifths of senators duly chosen and sworn not having voted in the affirmative, the motion is not agreed to.

(END VIDEO CLIP)

COOPER: So that's the motion to begin debate on the 2011 Defense Authorization bill with language in it repealing "don't ask, don't tell." So you heard there 57 senators voted for it, 40 against. Well, you may ask, well, if there were 60 senators who were for the repeal, how come only 57 voted for it?

So let's just break it down for you. Three senators could have made the difference. Democrat Blanche Lincoln who supported the repeal didn't vote at all because she got there late. She says she was at the dentist. Republicans Lisa Murkowski and Scott Brown both who said they support repealing "don't ask, don't tell," voted against the bill today. And they blamed timing. Saying until the tax bill is done, nothing else should be addressed. So even though they support the repeal, they voted against it.

There was also anger among Republicans for the way Senate Majority Leader Harry Reid went about the vote. Republican Susan Collins of Maine who also favors the bill has for days has been demanding more time to debate it. Interestingly she didn't get what she wanted but she still went ahead and voted for the repeal of "don't ask don't tell" today. She was the only Republican to do so.

Senator Reid who has been negotiating with Collins is also getting blamed by supporters of the repeal who believe he forced the vote today, even though he knew it would fail to pass because Republicans wanted more debate and had promised to act first on tax cuts.

So this afternoon on the floor of the Senate, Reid said they had to vote today because time had simply run out.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D-NV), MAJORITY LEADER: This has been taking months to do this -- months. And the time has gone, as Senator Levin has said, to stop playing around with this.

(END VIDEO CLIP)

COOPER: Now, whatever you think of ending "don't ask, don't tell," and we don't take sides on policy issues on this program, today was a clear cut case of politics trumping policy. It's a sign of what Washington is like today that a majority of lawmakers could not pass a bill a majority of Americans said they want. It's a sign of what Washington is like, that a number of senators voted against what they say they're for.

Dana Bash has been following the political posturing on Capitol Hill. What happened today? I mean, how -- is -- is that -- do you believe that that's accurate? I mean is that essentially what happened? Politics trumping personal opinions here?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Politics in process. Look. I mean, that I think, there's no other way around it.

I'll tell you, first thing this morning Anderson, I was getting word on my Blackberry that Harry Reid was in fact going to hold a vote despite progress in those talks that we talked about last night. It was very fluid.

But the fact is, he -- when the vote actually happened, it was a surprise. Blanche Lincoln, you mentioned it wasn't her fault that she was at the dentist because she didn't know it was coming. Now, Reid when he did this, he flatly said he simply did not believe anything he -- that he agreed to with GOP Senator Susan Collins would make the outcome different.

And as one aide in Reid's office put it to me tonight, Republicans from their perspective would have come up with excuse after excuse to stall. I'll tell you, though, the problem -- the problem, Anderson, for Reid is that gay rights activists aren't so sure. They believe that there are 60 votes, as you mentioned for repealing the policy of "don't ask, don't tell." And some are telling me that they feel betrayed by Reid for not just giving those Republicans a vote on the tax cut issue first as they demanded -- Anderson.

COOPER: So Lieberman, Independent Senator Lieberman and Collins are saying that there could be a separate "don't ask, don't tell" repeal legislation introduced this session. What does that really mean and how likely is it?

BASH: We know as this ill-fated vote was going on right on the floor of the Senate, Lieberman -- Senator Lieberman extracted a promise from Harry Reid to try one more time to repeal "don't ask, don't tell" in this lame duck session. Reid is a lot -- under a lot of pressure. Not to let today's vote be the last word on this very important issue.

So Reid's aides, Anderson, are telling me that he will try to keep that promise. Now, sources who support the repeal say they believe if they do get one more chance at a vote after everything else is out of the way, they will have the 60 votes to pass it.

The problem as we talked about last night is the calendar. The Senate will likely spend next week most of it on the tax cut issue, they have to fund the government, and Democrats want to spend a fair amount of time debating ratification of the START Treaty. That's already a lot to do in the two weeks until Christmas.

So the question is can they squeeze it in? I am told tonight by senior Democratic sources it is possible.

COOPER: All right. Dana Bash, again, a long day of reporting, I appreciate it.

A short time ago I talked with democratic strategist, Paul Begala, Republican strategist, Ed Rollins and Alex Nicholson, who is discharged from the Army because of "don't ask, don't tell." He's the founder and executive director of Service Members United which is lobbying for repeal of the law.

(BEGIN VIDEOTAPE)

COOPER: Paul, clearly politics have got in the way of -- of actual votes and -- and principle here, but who do you blame for -- for this motion dying today?

PAUL BEGALA, CNN POLITICAL CONTRIBUTOR: Well, the people who voted against it, frankly, which is a united Republican Party. You even had some Republicans, like Scott Brown from Massachusetts, Lisa Murkowski from Alaska, who voted against legislation that they say they support. It's hard for me to understand why you vote against legislation that you say you support.

This is a bill that's been worked on for nine and a half months. It's got a lot of really important things for the military: Pay raise, MRAPs, those mine resistant ambush protected vehicles that protect our -- our guys out from IEDs and other explosive devices; a lot of good for the military in here. And, of course, equality in the military, which the Joint Chiefs Chairman and the Defense Secretary have asked for.

COOPER: Ed, it is an interesting situation, where you have, apparently, on paper, you're -- you know, enough votes or people saying that they would -- would vote for -- ultimately for repeal, but it -- it dying for, you know, sort of political reasons, people annoyed that the vote happened when it did, that there wasn't enough debate on -- on -- on the issue or -- or -- you know, or whatever else reason they used.

ED ROLLINS, CNN SENIOR POLITICAL CONTRIBUTOR: Listen, Harry Reid had -- for four years, he's had a majority in the Congress. He could have pushed this at any given time.

The election took place. Republicans made it very clear what they want to vote on in this lame-duck session. They're for the military stuff. They may very well be for the equality in the military. But they basically said, don't clutter it up. Let's have procedure. Reid basically has thrown this up, as you say, for political reasons.

I think, at the end of the day, it's something that's -- everybody wanted a little more time to debate it. It's a very significant issue. And I think it deserved -- it deserved the right to have that.

(CROSSTALK)

ROLLINS: If you want to get Republican votes, you basically have to at least listen to them and give them an opportunity. It's a new game.

COOPER: Alex, you were discharged under "don't ask, don't tell." You're -- you're fighting to -- to repeal it.

Who do you blame?

ALEX NICHOLSON, FOUNDER AND EXECUTIVE DIRECTOR, SERVICEMEMBERS UNITED: I think there's certainly enough blame to go around, but two actors in this, I think, are worth pointing out: number one, like your other guest mentioned, of course, the Republican Caucus, almost unanimously voted against this.

Susan Collins heroically bucked her party and voted her conscience to do the right thing on this, despite significant arm- twisting from, I think, the Republican leadership.

But I think it would be wrong to ignore the fact that Senator Harry Reid bears some responsibility as well. I don't believe that Senator Reid negotiated in good faith with Senator Collins, especially in these last couple of days moving forward.

BEGALA: Paul, what about that? I mean, Senator Reid is saying, look, there -- or his people are saying there wouldn't have been enough time, that -- that Senator Collins wanted four days of -- of debate, but that it could have been extended far beyond that.

BEGALA: Right. I mean tick-tock. It's December 8. There are only so many shopping days until Christmas. And, you know, there's only so many days and legislative days, until this Congress goes out of existence.

In addition to this bill, which has been worked on for nine-and- a-half months and debated for nine-and-a-half months, and the subject of 33 committee or subcommittee hearings over those nine-and-a-half months, enough debate on that; they still have to vote on a major, important nuclear arms reduction treaty with the Russians, this new tax deal that -- that President Obama and the -- the Republicans seem to have cooked up, and -- and actually funding the government for -- for the rest of the year.

COOPER: Ed does -- does President Obama have a hand in all this? Because, I mean, he basically told the Senate, look, you know, don't -- don't move on this until the -- the Pentagon survey is done. He knew that wouldn't be done until December 1st. He knew the midterms were going to be incredibly contentious.

Did he set this up to -- to kind of fail?

ROLLINS: Well, in a way --

COOPER: Or was this just short-sighted?

ROLLINS: More -- more important -- in a way, he did, but, in a way, he can solve it. He can order the Justice Department not to prosecute.

COOPER: Right.

ROLLINS: He can order the Secretary of Defense not to let anybody be thrown out of the military, even if they say they're gay or what have you. It's -- it's irrelevant.

COOPER: Alex, where do you pin your hopes next? I mean, is it the courts? Is it on the stand-alone bill that Lieberman and Collins are talking about?

NICHOLSON: Well, I think, in the immediate future, the stand- alone bill was our best option. That's what we came out and called for immediately after the vote failure.

And Senator Reid and Senator Collins were clearly of like mind in thinking this was the next best strategy. There is certainly enough time left to do it. It will have to be rushed. It'll have to be prioritized.

COOPER: Paul, do you think the stand-alone bill could work? BEGALA: It can. It's going to -- as a practical matter, given the blow-up in the Senate today, it's going to have to pass the House first. So, then, senators have a time, a little time to kind of get their breath and let some of this animus dissipate, and then see that it's already done in the House. All they have to do is pass it and send it to the President.

So it's still a long shot, Anderson.

COOPER: By the way, Paul, I think you said it's December 8th. It's December 9th, obviously, today.

You say that the President should -- I mean, you've said all along the President should issue a stop --

(CROSSTALK)

BEGALA: Yes.

COOPER: -- a stop-loss order.

BEGALA: The President is the commander-in-chief of the military. If he believes, as he says, that discriminating against, kicking 14,000 men and women who are qualified and serving honorably, 14,000, kicking them out, that hurts his military, he has an obligation as commander-in-chief to issue a stop-loss order.

COOPER: Ed, politically, is that something you see President Obama doing?

ROLLINS: I think he'll end up having to do it. And -- and I think Republicans will vote for this over time. I think most Americans today don't want any discrimination, especially in the military.

COOPER: Ed Rollins, Paul Begala, Alex Nicholson, appreciate it. Thanks.

ROLLINS: Thank you.

(END VIDEOTAPE)

COOPER: Well, let us know what you think. Join the live -- the live chat right now at AC360.com.

Up next: more on Harry Reid and his passion for tackling a bill legalizing online poker, tacking that on to the vital tax deal President Obama worked out with Republicans. Four years ago, he was against online gaming. Now he's for online poker.

We'll talk about that with Paul Begala and Dana Loesch, who also square off against over extending tax cuts for the wealthy.

(BEGIN VIDEO CLIP)

DANA LOESCH, EDITOR, BIGJOURNALISM.COM: These -- these are -- these are people who create jobs. These are people, by the --

(CROSSTALK)

BEGALA: No, they don't create jobs. They ship jobs overseas. Oh, nonsense.

LOESCH: A lot of individuals have to fly -- have to file -- well, no, that's because you guys raise taxes and you run companies out of -- and you run companies out of the country, and then you're like, oh, my gosh, why are they leaving?

(END VIDEO CLIP)

COOPER: And later, "Keeping Them Honest": the lawmaker who will be in charge of consumer protection in the next Congress, guess where he gets the biggest percentage of his campaign contributions. And guess who else is getting big money from big money? We're "Keeping Them Honest."

(COMMERCIAL BREAK)

COOPER: Well, as you heard, Harry Reid said they're out of time for voting on "don't ask, don't tell," but, apparently, there's enough time to pass the Internet Poker Act of 2010. It's a bill legalizing online poker at the federal level.

Now, wait a minute, what about, you know, all that other stuff?

(BEGIN VIDEO CLIP)

REID: We have a lot of things to do in a short period of time.

Let's run over what we have to do. We have a tax issue. We've got the funding issue. We've got the START treaty. We've got the defense bill. And we have the DREAM Act. We have the fire-fighters issue. We have the funding of the seniors for the COLA that they deserve. We have the 9/11 situation regarding the people in New York who are -- have been harmed, damaged and are sick. So, we have lots of things to do.

(END VIDEO CLIP)

COOPER: That was Senate Majority Leader Harry Reid.

Funny, though. He didn't mention the Internet Poker Act of 2010. And it's hard to imagine why he left it off the list, considering that he's the one pushing to pass it. He's trying to attach it to the tax bill, putting out a statement tonight saying -- quote -- "The online poker bill I am working on is good for the country and for Nevada."

He goes on to say the bill would provide consumer protection and respect the decisions of states that don't support gambling. He concludes, saying -- quote -- "Finally, the revenue and jobs from this multibillion-dollar industry will stay where it belongs, here in America." So, he's pushing the bill, but, interestingly, four years ago, he was against online gaming. You might wonder what's changed. Well, back then, he said Internet gaming couldn't be adequately regulated. Now he says it can.

But what also changed is the revenue. Four years ago, the big Nevada casinos thought of online gaming as the competition. Now they're realizing that, with their brand-name recognition, they can maybe get a big piece of the online action.

Take a look at this from the Union Gaming Group, which follows the gambling industry, quoted in "The Las Vegas Sun": "We believe there will be a billion dollars in earnings generated by licenses," earnings the industry watchers say, for big names like MGM Resorts International and Caesar's Entertainment.

According to the nonpartisan Center for Responsive Politics, they have been the number-one and number-three donors to Senator Reid over the last 21 years.

Now, in fairness, those big donors are also huge employers, and unemployment in Nevada is sky-high. Senator Reid was elected to serve the interests of his state, certainly, which include the people and the businesses in it. As a majority leader, however, he also serves the country. So our question is, is there a conflict?

I talked about it earlier tonight with Paul Begala and Dana Loesch, editor of BigJournalism.com and host of Saint Louis radio station KFTK.

(BEGIN VIDEOTAPE)

COOPER: So, Paul, given all that Harry Reid has on his plate, the tax cuts, "don't ask, don't tell," the START treaty, why would he be trying to slip an online poker bill into this session? He's not some obscure member who you know, might be able to go unnoticed. He's the majority leader.

BEGALA: Right. And he's also the senator from Nevada. The biggest employer in his state is the gaming industry. The biggest taxpayer in his state is the gaming industry.

I think he and -- and his supporters believe that there are a lot of Americans getting ripped off on online gaming, and this would set some consumer protections and some regulation in there. So, obviously, a senator from Nevada is going to be for that.

COOPER: Dana, do you buy that, that it's just about, you know, wanting to help folks -- stop folks from being ripped off online?

LOESCH: Well, that's the -- that's a kind of kittens-and- sunshine sort of explanation for it, I think.

Really, and the reality of this is that there's --

(CROSSTALK) COOPER: Kittens and sunshine?

LOESCH: -- there is -- there is a lot of tax revenue to be had over this.

Seventy-five percent of the revenue is going to be going back to Nevada, going to be going to New Jersey as well. So, that's -- they look to make a lot of money off of this.

COOPER: And so, it's smart politics for Harry Reid?

LOESCH: Oh, yes, completely.

He is using his senatorial power to go and pay back the people who have donated the most to his campaign. And there's a lot of politicians who do it, but let's just be honest and call it what it is.

COOPER: Let's just talk about this tax deal now.

It's obviously unclear what's going to happen, ultimately, with the tax cut extensions. Does it make sense for House Democrats, Paul, to take on President Obama in such a -- a defiant and public manner?

BEGALA: You know, I don't know. It probably feels good for them.

I would actually reverse this. It's the President who took them on. I -- I -- I didn't think it was a good deal. Most House Democrats didn't think it was a good deal. But set that aside.

The President seemed to go out of his way to stick a thumb in their eye. He said people in his own party who disagreed with him preferred symbolism over substance, fighting over getting things done, that they were sanctimonious, for goodness sakes.

He would be much better served if he said, look, I -- I'm the President. I think this is the best thing for the country, but I understand there are principled people in my own party who disagree with me. I admire that principle, but I want you to work with me to try to do what I think is best.

Wouldn't that be nicer than just going out there and sticking a thumb in the eye of people, many of whom lost their jobs in part because of Barack Obama?

COOPER: Dana, does it make sense, do you think, for the President to have made this deal politically? Because now it's going to come back -- it's going to be another big issue in 2012 during the presidential election, because these tax cuts will be set to expire then.

LOESCH: Absolutely.

And we're going to see this being used on campaigns. It's going to be the -- it's going to be this campaign season, but just repeated again in a couple of years.

I -- I think that this was the best that he could have done, but what I don't understand is, this is all theater. We wouldn't even be having this problem at all if Democrats, who had a filibuster-proof majority, if they had done something about taxes earlier, perhaps, before the election, like way back when they -- when they had all this political capital and they were shoving through health care and everything else.

If they would have actually paid attention to -- and then we wouldn't even be in this situation. It just seems a little bit comical to me now, because they waited for so long. And now here it is, the 11th hour, and, suddenly, they're all concerned.

COOPER: Paul, did Democrats make a mistake?

BEGALA: Yes, I think -- I think Dana makes an important point, and a legitimate point.

I would have one important correction. They didn't have a filibuster-proof majority in the Senate, or they would have done this. But it's a fair point.

(CROSSTALK)

LOESCH: Well, they had it in the House, though.

BEGALA: They had a chance -- they -- they had a chance -- right. They had a chance in September. The Senate Democrats decided not to put this up right before the election. I do think that was a strategic mistake.

COOPER: Well, it does seem that Barack Obama ran as a candidate as the guy who could bring both parties together in a room and come up with compromise and a deal.

Isn't that what he's done? Why, then, are liberal Democrats surprised that he's made a deal?

BEGALA: Well, he -- he -- who, he didn't say that. He said, I don't just want to play the game better in Washington. I want to change the game.

He didn't say that he would just make cynical political deals. And I think that's what this is. It may be the better thing for him to do. I tend to disagree with that. But, no, I think this runs very contra to the Obama brand. If tax cuts for the rich generated jobs, we would have more jobs.

(CROSSTALK)

LOESCH: This isn't tax cuts for the rich.

(CROSSTALK)

BEGALA: -- because that's all we have done for 10 years. LOESCH: That's misframing the argument.

BEGALA: I mean, it's just -- I mean, I'm sorry. You know, look, I -- I believe in lots of crazy stuff, and I believe in Santa Claus and the Tooth Fairy, but it -- you just can't persuade me to believe, after 10 years of --

(CROSSTALK)

LOESCH: Really?

BEGALA: -- shedding jobs and cutting taxes for the rich, that somehow now all we have got to do is cut taxes for the rich, and now, all of a sudden, after failing to create jobs for 10 years --

(CROSSTALK)

LOESCH: What is with this cutting taxes for the rich? These -- these are -- these are people who create jobs.

(CROSSTALK)

BEGALA: That's what we're doing.

LOESCH: These are people, by the --

(CROSSTALK)

BEGALA: No, they don't create jobs. They ship jobs overseas. Oh, nonsense.

LOESCH: A lot of individuals have to fly -- have to file -- well, no, that's because you guys raise taxes and you run companies out of -- and you run companies out of the country, and then you're like, oh, my gosh, why are they leaving?

It was because you're making it impossible for them to do business in the United States. Why -- why is there no explanation or address of that?

But it's not tax cuts for the rich.

BEGALA: I just --

LOESCH: These are job-creators. These are people who create jobs, those evil businesspeople that employ everyone.

BEGALA: First off, Dana, cutting taxes for the rich does not generate jobs. Second, those big businesses and those CEOs --

LOESCH: It -- it absolutely does. It absolutely does.

BEGALA: Excuse me for talking while you're interrupting.

LOESCH: Statistics support it.

BEGALA: Those big businesses and those CEOs --

(CROSSTALK)

LOESCH: I just had to correct --

(CROSSTALK)

BEGALA: -- who ship jobs overseas, they're the ones who are getting these tax breaks. And if it worked, we would have -- when Bill Clinton was president, we raised taxes on the rich.

And I know it's a socialist paradise -- 39.6 percent, that's tyranny -- 35 percent under Bush, that's freedom.

(CROSSTALK)

BEGALA: So, the line between freedom and tyranny is a very narrow and perilous one, because we were free under Bush, and everything was great under Bush with 35 percent top marginal rate for the rich --

(CROSSTALK)

LOESCH: Let me ask you this question. This will -- this will settle it.

BEGALA: -- but 39.6 that Obama wants -- I mean, come on.

LOESCH: Let's boil -- let's boil it down to one quick question. Paul, Paul, Paul --

(CROSSTALK)

BEGALA: Who would you rather have -- or whose economics would you rather have, the economy we had under Clinton or the economy we had under Bush?

(CROSSTALK)

LOESCH: -- do you believe that this -- do you believe that the state can control the output of the individual? Do you believe that it is the state's right to claim the fruits of the labor of -- of you or anyone else? Because that, ultimately, is what it comes down to.

(CROSSTALK)

BEGALA: But -- but do I -- oh, I believe in a democracy. All of us have a moral obligation to support our country.

LOESCH: Oh, there we go. No, no, no.

BEGALA: Some of us -- go to Walter Reed. There are men and women at Walter Reed who have given --

(CROSSTALK)

LOESCH: Answer the question. Do you believe the state can control the output of the individual?

COOPER: One at a time. One at a time.

Paul -- let Paul answer.

(CROSSTALK)

LOESCH: Paul, you're deflecting.

COOPER: Let Paul answer.

BEGALA: I believe in a democracy. It is the sacred obligation of every citizen to support and protect and defend its country.

Some people do it with blood and limbs. And it really is nauseating for me to see rich people to say, I don't even want to write a check, when I -- I know people who have lost two legs in wars that they didn't even support.

So, I -- I'm sorry. Don't give me all this high and mighty nonsense that somehow rich people are better than working people, because I think that's a load of hooey.

(CROSSTALK)

LOESCH: I'm not. You're putting words into my mouth. That's a strong man argument right now.

BEGALA: You say, oh, rich people are great. They create all the jobs.

But they don't, actually. Middle -- this -- this whole economy is driven by middle-class consumers, Dana.

(CROSSTALK)

LOESCH: No, I was talking about business owners. Don't do this class warfare stuff.

(CROSSTALK)

COOPER: All right, Dana, I want to give you the final thought, and then we have got to go. We have got to go. I want to give you the final thought, Dana. Go ahead.

LOESCH: This -- the bottom line is that Paul's argument rests upon the false premise that people who are in a particular income bracket have no opportunity or reason at all whatsoever to leave that particular income bracket.

And that is the thing that Democrats like to exploit when they like to say, oh, let's -- let's do this class warfare. Let's attack the rich. Let's attack the people who create jobs.

That's just -- that's false. And I think that we need to stop framing the argument in that way and -- and quit being so adversarial towards businesspeople.

COOPER: Paul, your furrowed brow --

(CROSSTALK)

LOESCH: They create the jobs and help the middle class.

COOPER: -- and -- and smirk says it all.

So, I'm going to let Dana have the last -- the last word here.

Dana Loesch, appreciate it, Paul Begala as well. Thank you.

LOESCH: Thanks.

(END VIDEOTAPE)

COOPER: Well, still ahead: Congressman Spencer Bachus, he says he wants to eliminate some of the financial reforms passed last July, reforms supporters say were meant to protect consumers from another financial meltdown.

Well, tonight, we check out who's been giving him and other members of the Financial Oversight Committee, Democrats and a Republicans, a lot of money. We're "Keeping Them Honest."

And later: We all want to think that prosecutors are devoted to upholding justice, right? That's the way it always is, usually, on those TV shows, on legal shows. But a new study about prosecutors who act unethically is really shocking. We're going to show you how rarely prosecutors who cross the line actually get punished for their actions.

(COMMERCIAL BREAK)

COOPER: Another "Keeping Them Honest" report tonight, this one about power, politicians, and money, an awful lot of money.

I want to introduce you to Republican Congressman Spencer Bachus of Alabama. He's replacing Democrat Barney Frank as head of the powerful House Financial Services Committee. That's the committee which oversees the financial industry and enforces consumer protection laws.

Now, Bachus hasn't taken over yet, but is already sending some strong signals that he would like to dismantle or change some of the financial reforms passed last July, reforms which supporters say prevent or are meant to prevent another crisis like the one that led to all those bailouts.

Here's a letter that he sent to members of the Financial Services Oversight Council last month, expressing concern that shareholders of Goldman Sachs and JPMorgan Chase would be hurt by some of the reforms, because the banks would be less profitable.

Now, you can agree or disagree with that position, but we think it's worth pointing out that Mr. Bachus gets most of his campaign contributions from the finance, insurance, and real estate sectors. Nearly 63 percent, in fact, of his campaign money this past election cycle, according to Sunlight Foundation and the Center for Responsive Politics. That's a bigger percentage than any other House lawmaker receives from these industries.

Now, let's just make clear: he's certainly not the only one taking money from the financial industry. Outgoing chairman Barney Frank, for instance, got about a third of his campaign contributions from the financial, insurance, and real estate sectors.

According to a new report by another group, Citizens for Responsibility and Ethics in Washington, CREW, just about everybody who serves on that committee does very well with contributions. According to CREW, freshman members who sit on financial services out- raise their peers by 55 percent. And of course, much of that money comes from the very industry the committee is charged with monitoring.

According to Politico, at an October meeting with more than 100 financial industry lobbyists, Bachus slammed donors who in past years had been more generous with Democrats. He reportedly pointed out the Democrats passed those new regulations, the ones that he's fighting to change. Bachus reportedly told lobbyists he wants an equal chunk of their donations.

Actually, according to the Center for Responsive Politics, overall, financial lobbyists did now give more money to Republicans than Democrats this year. The question is what are they getting for all the money?

Melanie Sloan is the executive director of CREW and joins me now.

Melanie, I mean what raises eyebrows is Congress people getting money from the very industries that they're overseeing. How much access, how much influence does all that money buy?

MELANIE SLOAN, EXECUTIVE DIRECTOR, CREW: It buys them tons of access. And it's not just Mr. Bachus over on financial services. You can expect the members on the agriculture committee to be getting money from agribusiness and defense appropriators to be getting money from defense contractors. Frankly that's just the way the game is played here in Washington.

COOPER: And it's all legal, it's all above board?

SLOAN: It's all legal and it's all above board until somebody can prove a bribe, that there's a direct exchange, a quid pro quo, but it sure looks like bribery to everyday Americans.

COOPER: Well, you know, some folks -- just to play devil's advocate here -- will say, well, look, you can't say that the money is necessarily -- or you can't prove that it's necessarily driving the politics. You could say that it's understandable financial money would be directed to people whose politics favor the financial industry or that the industry thinks favors them. SLOAN: Sure, it's the chicken or the egg problem. Which comes first? The contributions or the policy? But either way, they both dovetail nicely together, and you see members of Congress pushing very hard for industries that are dumping money into their campaign coffers every day, and it leaves a lot of Americans cold. The question is who's really fighting for our interests if the folks on these top committee assignments are really fighting for the interests of those who are giving them the most money.

COOPER: What should we expect from the new leadership? I mean, will the new consumer financial protection bureau, you know, change demonstrably?

SLOAN: Oh, I think we are going to see a big change in the new leadership. I believe Mr. Bachus has said he's going to reserve every Thursday to have Elizabeth Warren come in and explain herself.

He's already taken a strong stance against her and is looking to have an investigation into what she does over in the new -- in the new agency. And I think he's going to be out there to make trouble for her.

Luckily, Elizabeth Warren is a smart cookie, and my money's on her. She can handle herself in front of Mr. Bachus.

COOPER: You know, you said something interesting to our producers. You said the members of the financial service committee are not necessarily picked for their expertise. That -- that -- I mean, that kind of surprises me. How can you say that?

SLOAN: Right. Because what they're actually picked for is their vulnerability, for the most part. Most of the members who end up on that committee, particularly freshmen, are there because that committee is known as a top donor draw. If you are on that committee, you will bring in more money.

As we said, CREW did this study earlier where we found that people on the financial services committee out-raise their peers by 55 percent in the freshman class. So you can expect -- and we haven't seen yet who's going to be on the financial services committee altogether next year -- but you can expect to see a lot of incoming vulnerable Republicans will be put on that committee, with the idea that they'll raise a lot of money to help fend off challengers.

COOPER: Fascinating look. Melanie Sloan, appreciate it, from CREW. Thanks.

Coming up, they're the people we trust to put away the criminals but how much can we actually trust them? We're talking about prosecutors. A stunning report about prosecutorial misconduct: instances of prosecutors withholding evidence, even presenting false evidence. What's really shocking is how rarely prosecutors actually get punished when they're caught crossing the line.

And later you're going to crack up over this one: a young woman freaking out in a pizza place because her pizza's not ready in time, storming out. She gets delivered straight to our "RidicuList" tonight. You don't want to miss it.

(COMMERCIAL BREAK)

COOPER: Well, tonight, it's a dramatic story that makes for a great movie plot, but it's repeated all too often in real life. Someone's convicted of a crime, spends decades sometimes in jail, and then evidence comes to light that changes everything. We've heard that story a lot.

Sometimes, though, maybe more often than we'd like to think, it's because prosecutors, the people that we count on to put criminals in jail, don't turn over evidence that could help clear a defendant, or they present false evidence.

Now a recent study out of California shows these types of actions, prosecutorial misconduct, are shockingly prevalent. The Northern California Innocence Project at the Santa Clara University School of Law came out with a massive study that revealed more than 4,000 state and federal appellate rulings in California for the period of 1997 to 2009. It found that 707 cases, about one a week, in which courts found prosecutorial misconduct.

And what's even more alarming is that the prosecutors almost never get punished. In fact, the study found that the California state bar publicly disciplined only one percent of prosecutors in hundreds and hundreds of cases of misconduct -- just one percent.

So the question is, what about the lives that are literally hanging in the balance in these cases? The defendants?

Well, of the 707 cases in which courts found misconduct, in the vast majority, 548, convictions were upheld. The courts saying the defendants got fair trials, even despite the prosecutors' misconduct.

In only about 159 cases, about 20 percent, did the courts either set aside the conviction or sentence, declare a mistrial, or bar evidence.

The study also found that overwhelmingly, courts failed to report prosecutorial misconduct, and prosecutors denied that it occurred. It's pretty astounding stuff.

I spoke with Barry Scheck, the cofounder of the Innocence Project; and CNN senior legal analyst, Jeffrey Toobin.

(BEGIN VIDEOTAPE)

COOPER: I've got to say, I mean I was blown away by the report that you guys put together.

Jeff, you're a former prosecutor. Were you surprised by just how often prosecutorial misconduct seems to be taking place?

JEFFREY TOOBIN, CNN LEGAL ANALYST: I was shocked and appalled. I mean, it really is an astonishing report. Because, you know, prosecutorial misconduct is something that we all know exists, but the sheer amount of it in northern California, which is certainly not someplace that's known as a hotbed of bad prosecutors, which is probably a fairly representative place. That there is that much prosecutorial misconduct there is really a chilling fact.

COOPER: Barry, how -- how do you explain that this is so prevalent? Is it just overzealous prosecutors?

BARRY SCHECK, CO-FOUNDER, INNOCENCE PROJECT: Well, you know, I think that you have to look at how the report was compiled. In California, the courts were actually making findings in cases as to whether or not prosecutors broke the rules.

And what's fascinating is that they had this statute in place that said every time, let's say a prosecutor, you know, suppressed exculpatory evidence or did something that was wrong, and it resulted in a conviction being reversed, then they had to refer it to the state bar for investigation, and none of the judges were doing that.

What's most edifying, though, is all the other cases where there were acts of misconduct, but they found it was harmless error because there was overwhelming proof of guilt. But the conduct was no different than the cases where there was a reversal.

And so that's how you see that there's a lot more of this going on that's being acknowledged, except it was going on in cases of people that were overwhelmingly guilty.

COOPER: What's also shocking, though, is, I mean, not only how often this stuff happened but how rarely the state bar disciplined prosecutors, who'd be found guilty of misconduct. I think only one percent of the time.

SCHECK: Right. And they -- they weren't doing it at all, really, because they're not looking at it in the cases where there was a harmless error, overwhelming proof of guilt. And yet it's there that you really have to act.

And what we need is for, frankly, prosecutors' offices themselves to develop their own internal review systems, audits, the way we do for hospitals, financial institutions, frankly, even police departments to a better extent than we do with prosecutors.

And I want to be the first to say that the same thing is true for the defense lawyers. You know, when you have a lawyer that is completely ineffective and not doing the job, the bar associations and the courts do not act against those people, either. And we do not audit their other cases.

Every time that there's a reversal for some act of misconduct, whether it's a prosecutor or a defense attorney that's not doing the job, you should go back and look at other cases to see if it had happened before.

COOPER: Jeff, you know, doctors get criticized for protecting their own and not criticizing other doctors. It sounds like, from this report, it's the same thing among lawyers.

TOOBIN: It's identical. And what's -- it's so chilling. But the thing that I kept thinking about as I was reading the report was why? Why are these prosecutors doing it?

And you know, I don't know if I have a clear answer. I think as a prosecutor, you get so used to being right, you get so used to a parade of guilty defendants, that you start to make up your mind quickly, and then you just sort of push the evidence in the direction you think it's going to go.

But you know, it is also true that prosecutors don't make any more money, whether they get convictions or not, so I just -- I --

COOPER: But some of them, I mean, they want political careers. They seek higher office. You know, they want a successful conviction rate.

TOOBIN: I recognize that, but I mean, it just seems to me, it's so horrifying to think that you could be responsible for an innocent person in prison that you are willing to break the rules to do that? I mean, it's just -- it was sort of baffling to me.

COOPER: It is amazing, Jeff. I think a lot of people -- certainly, I put myself in this category -- kind of always assume prosecutors are on the side of good and, you know, above -- above -- you know, would go above and beyond to make sure that they're following all the rules, but I mean, I've got to say, this report makes me look at them in a whole new light.

TOOBIN: Unfortunately, prosecutors tend to think of themselves that way.

I think the answer here has to be systems. You know, testing convictions, putting multiple people involved, because unfortunately the system now is basically a trust system. It puts enormous powers in individual prosecutors.

And unless you have a review system or checklist that there is not the kind of institutional check against this; unfortunately, if you're just relying on the good faith of prosecutors, that's no better than relying on the good faith of bankers or doctors or any other members of professions that we've come to be disappointed in, in recent years.

COOPER: Or as Barry pointed out, also defense attorneys. Barry Scheck, appreciate the report.

Thank you, Jeff Toobin, as well. Thanks.

SCHECK: My pleasure.

Pretty scary stuff.

Up next, behind enemy lines, an up close look at Taliban troops fighting in Afghanistan.

Also tonight, protests on the streets of London. Did you see this? Prince Charles' car was attacked while the prince and his wife were inside. Details on that.

And pizza sure can make some people do some crazy things. We're going to show you one woman's pizza place freak-out which lands her on tonight's "RidicuList."

(COMMERCIAL BREAK)

COOPER: Want to tell you about a remarkable program coming up this Saturday and Sunday night. The video was shot by a freelance journalist who really risked his life to travel behind enemy lines in Afghanistan to report on the Taliban.

He ended up actually getting kidnapped, almost killed, but the footage he brought back, the pictures you're going to see, they're the most up-close images we've gotten of the Taliban. And we think it's an important documentary, because it really demystifies the Taliban. And in a war, knowing the motivations of the enemy is important to -- in order to defeat them.

Here's a short scene from this weekend's special, "TALIBAN."

(BEGIN VIDEOTAPE)

COOPER (voice-over): High in the Afghan mountains, Taliban fighters return to their positions, preparing for another attack.

PAUL REFSDAL, JOURNALIST, KIDNAPPED BY THE TALIBAN: They have at least one Soviet anti-aircraft gun positioned in one place in the mountain, and they use that for all the ambushes as a long-distance weapon against U.S. vehicle.

COOPER: Refsdal says it isn't much, but it's all the fighters have.

REFSDAL: When I stayed with the Taliban, what I observed was very little weapon, few ammunition, old weapons. I mean, these are weapons, guns that are 25, 30 years old. And the ammunition is the same age, more or less. So they don't have -- they don't have much.

COOPER: And yet they fight almost constantly.

UNIDENTIFIED MALE (through translator): Ghairat, do you hear me?

UNIDENTIFIED MALE: Mujahed, do you hear me?

UNIDENTIFIED MALE: Ghairat, who was there above you? Was it Omar?

UNIDENTIFIED MALE: It was Omar.

UNIDENTIFIED MALE: OK, OK, get yourselves to No. 2.

REFSDAL: These guys, the Taliban were doing, you know, two and three attacks every day. So they were very active.

UNIDENTIFIED MALE: Khyber, Khyber. Do you hear me?

UNIDENTIFIED MALE: Khyber, get out. Where is it? Do it, OK?

UNIDENTIFIED MALE: If I see it, you will see -- it will Catch fire.

UNIDENTIFIED MALE: God willing.

UNIDENTIFIED MALE: Find yourselves a good position, a strong position. Take down these bullies one by one.

UNIDENTIFIED MALE: Assad, everything is OK. Tell all the comrades to get to safety. Assad, prepare yourself. As soon as they get out, take action against them.

UNIDENTIFIED MALE: Get to a good position to see the target.

UNIDENTIFIED MALE: Long live, long live.

(END VIDEOTAPE)

COOPER: "TALIBAN," Saturday and Sunday night, 8 p.m. Eastern right here on CNN. It really is worth -- worth your time.

There's a lot more happening tonight. Susan Hendricks joins us with the "360 Bulletin" -- Susan.

SUSAN HENDRICKS, CNN CORRESPONDENT: Anderson, a 16-year-old from the Netherlands has reportedly confessed to those hacker attacks against Visa and MasterCard after the companies refused service to WikiLeaks. Dutch authorities say the teen is probably part of a larger group of hackers who are under investigation.

In Haiti, at least one protester has died in violence that has erupted over election results. Mobs charging election fraud burned the headquarters of the government-backed candidate, who advanced to the runoff next month. Angry protesters faced off with United Nations troops.

Meanwhile, word that Sarah Palin plans to travel to Haiti this weekend with Franklin Graham and his relief organization. The former Alaska governor will visit a cholera clinic while she is there.

In London, students in the streets protesting a parliament vote to raise tuition at universities. Demonstrators attacked a car carrying Prince Charles and Camilla. They were not hurt. At least ten officers and dozens of demonstrators were injured in this violence. Police say at least 22 protesters were arrested.

In Southern California, take a look at this. Authorities intentionally set fire to a house where a huge amount of homemade explosives was stashed. As you can see, the single story home was engulfed in flames, some three to four stories high. The controlled burn didn't appear to threaten nearby homes, though. Officials called it successful.

And 2011 is looking very pink. That's according to color authority Pantone, which has picked honeysuckle as the color of the year. Pantone predicts it will be the most popular shade of 2011.

Anderson, got to stock up on honeysuckle, I guess.

COOPER: I don't even know what color honeysuckle is. I didn't know that was a color.

HENDRICKS: Bright pink. I know. I had to look it up.

COOPER: Really?

HENDRICKS: Yes, really. Who knew?

COOPER: All right. All right, Susan, thanks.

We like to end each program with a new name added to our "RidicuList," in which we honor folks who have said or done stuff that's, well, just kind of ridiculous. And we have a doozy tonight. So who's hungry?

Tonight we give you Pizza Girl. Now, we don't know her name or really anything about her, but clearly she wants her pizza, and she wants it now.

It's a little slice-of-life drama that played out at a Papa John's with extra cheese. Take a look.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Just put the (EXPLETIVE DELETED) pizza in the (EXPLETIVE DELETED) oven. Stop asking the same (EXPLETIVE DELETED) question over and over again.

(END VIDEO CLIP)

COOPER: Oh, Pizza Girl, why are you so saucy?

We're going to have a manners lesson in just a minute, but first, I've got to tell you, when I first saw this, it reminded me of something, but I could not remember for the life of me what it was.

I watched it a bunch of times and then I remembered what it reminded me of. I'm talking about the part where she yells, "Just put the 'F'-ing pizza in the 'F'-ing oven. Kind of sounds like creepy Buffalo Bill from "The Silence of the Lambs."

(BEGIN VIDEO CLIP)

TED LEVINE, ACTOR: Put the (EXPLETIVE DELETED) lotion in the basket.

(END VIDEO CLIP)

COOPER: So Pizza Girl, let this be a warning. You don't want to end up like Buffalo Bill, do you?

Now, I feel like we've been seeing this kind of behavior a lot recently. And I really have a problem with people screaming at folks who are just trying to do their job.

Remember the lady who freaked out at a McDonald's drive-thru in Ohio when she was told she couldn't get her Chicken McNuggets? They caught her on surveillance camera.

And then there was that woman who totally flipped out when she missed her flight at the airport in Hong Kong?

(BEGIN VIDEO CLIP)

(WOMAN SCREAMING)

(END VIDEO CLIP)

COOPER: Look. Who hasn't wanted to do that or done that in their mind, but you don't actually have to do that. All of these examples tell the same story. Screaming, flipping out, going bananas, it never works.

And beyond that, even if you're not caught on surveillance video, everyone has a cell phone camera these days. If you act like a jerk, someone's going to film it and put it on YouTube.

So for your own good and the good of everyone around you, let's just keep it civil, people. Stop yelling, start being polite to people who are only trying to do their jobs.

Pizza Girl, on the special I'm talking to you, because tonight you're topping the "RidicuList."

And a special note tonight. We want to welcome the newest member of our 360 extended family. Meet Ryan Christopher Licht. Our line producer, Jenny Blanco (ph), and her husband, Chris, welcomed Ryan into the world Tuesday morning. Adorable.

Ryan joins his older brother, Andrew.

Congratulations Jenny, Chris, and Andrew and Ryan. One day we'll tell you what all that yelling you heard in the control room the past nine months was about.

Up next, the teaching scandal that's made headlines in one state: allegations that teachers are cheating on standardized tests, changing student answers so they get better scores.

We're investigating in tonight's "Perry's Principles" report.

(COMMERCIAL BREAK)

COOPER: There's always the concern that students could be cheating and in Georgia, there now appears that teachers have broken the honor code themselves.

Education contributor Steve Perry spoke to the reporter in an Atlanta newspaper about the scandal in tonight's "Perry's Principles."

(BEGIN VIDEOTAPE)

STEVE PERRY, CNN EDUCATION CONTRIBUTOR: It's been one stunning headline after another in Atlanta. Evidence of cheating on standardized tests in at least 12 public schools. Not by students but by at least 100 educators including teachers, assistant principals and even principals.

UNIDENTIFIED MALE: There has been evidence of test alterations that are unacceptable.

PERRY: The Georgia Bureau of Investigation began questioning educators in mid-October after the governor widened the probe.

KRISTINA TORRES, "THE ATLANTA JOURNAL-CONSTITUTION": Federal authorities are also looking at Atlanta public schools. They are concerned about federal moneys any of these schools may have won, which is potentially fraud if they used, in this case, falsified scores to earn those dollars.

PERRY: Performance on state exams, mandated by the "No Child Left Behind" act can be linked to federal funding in Atlanta and some other public school systems around the country and proved test scores can also trigger bonuses.

TORRES: It can get $50 for a bus driver. It can go to -- depending if you made 100 percent -- $2,000 for a teacher.

PERRY: So every single employee of a school benefits when the scores go up.

TORRES: Yes.

PERRY: Kristina Torres has covered education for the "Atlanta Journal-Constitution" for the last seven years. In 2008, the AJC analyzed state exam results for students who needed to retake the test and noticed something didn't add up.

TORRES: Lo and behold, they all not only passed. They were all at the top.

PERRY: Everyone?

TORRES: Everyone.

PERRY: That prompted the state to take a closer look at the test forms. Eraser marks raised red flags.

TORRES: There's an average of how many times a student's going to go in and change a mark from wrong to right. And the schools they flagged were well beyond that. The state sanctioned 13 educators in all.

There were suspensions from 90 days to two years.

PERRY: Among those suspended were the principal and assistant principal at Atherton Elementary School in suburban Atlanta who admitted the wrong doing.

TORRES: They had admitted cheating. They had admitted physically taking these retests, going into a room and locking themselves in, and someone erase and someone called out the answers.

In October 2009 we published our second analysis and that analysis found 19 elementary schools statewide including a dozen in Atlanta that had unusual gains or drops. And that included schools that had such a gain that our odds put that at worse than one in a billion.

PERRY: One in a billion.

TORRES: One in a billion, with a b.

PERRY: Improbable odds that did nothing to erase doubt and only raised more questions. Questions that should be settled once Georgia's investigation wraps expected early next year.

(END VIDEOTAPE)

COOPER: It does seem like none of this information would have come out unless, you know, if the AJC hadn't done the digging. What's the best way you think to keep educators honest?

PERRY: Well, it's so important that the media go beyond just the numbers. And start asking questions. And that's what the AJC did. They went deeper.

And as a matter of fact, they found out information that no one else would have found out had they not put the time in. They put in almost two years on this project.

COOPER: Yes. It's a hard thing for a lot of news organizations to do. Steve, thanks.

PERRY: Thank you.

COOPER: Hey, that's it for 360. Thanks for watching.

"LARRY KING" starts right now.