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The Situation Room

Susan Rice Under Fire; President Obama Back in Campaign Mode; Interview with Senator John Thune; Will Erickson Challenge Senator Chambliss?; Will GOP Give In on Taxes for Rich?; Rare Report: CNN Crew Inside Syria; Cold War Plan to Nuke the Moon; Fear of Public Reaction in U.S.; Protests Near Egypt's Tahrir Square; EPA Suspends Future BP Contracts; Apple Fires Maps App Manager; Win a Date with Betty White; A White House Christmas

Aired November 28, 2012 - 16:00   ET

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

WOLF BLITZER, CNN ANCHOR: Happening now: new troubles for some top members of the Obama administration. More Republicans senators say they're troubled by what the United Nations ambassador, Susan Rice, is telling them. And now the acting CIA director has some serious problems as well.

President Obama pulls out all the stops to keep middle-class taxes low, but will Congress go along with higher taxes for the rich?

Plus, a long-secret U.S. plan, get this, to explode an atomic bomb on the moon. What were they thinking?

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

Today, we may be at the tipping point for one of the most important decisions President Obama needs to make as he begins his second term. On Capitol Hill, Republicans, including moderate Republicans, are sending the president a clear warning, don't nominate Susan Rice to replace Hillary Clinton as secretary of state.

Rice is the current U.S. ambassador to the United Nations. She spent a second day meeting with senators trying to explain some of her inaccurate comments she made after the September 11 terrorist attack on the U.S. Consulate in Benghazi, Libya.

CNN's senior congressional correspondent, Dana Bash, is joining us now from Capitol Hill with the very latest.

What happened today, Dana?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Wolf, it was one thing for Susan Rice to be criticized harshly yesterday by the three Republicans she met with because they had been among her harshest critics, Senators Graham, McCain, and Ayotte. Today's meeting was different because she met with a Republican who was among the remaining centrist Republicans in the Senate.

(BEGIN VIDEOTAPE)

BASH (voice-over): One of the most likely to throw Susan Rice a lifeline. It didn't happen.

SEN. SUSAN COLLINS (R), MAINE: I continue to be troubled by the fact that the U.N. ambassador decided to play what was essentially a political role at the height of a contentious presidential election campaign.

BASH: After meeting with Rice for more than an hour, Collins emerged questioning her judgment in giving the public what turned out to be incorrect information in the days after the deadly attack in Benghazi. And the Maine Republican was lukewarm about the prospect of Rice as secretary of state.

(on camera): If President Obama were to nominate Susan Rice to be the next secretary of state, could you support that nomination?

COLLINS: I would need to have additional information before I could support her nomination.

BASH (voice-over): Collins has gone out of her way to support Rice in the past, even introducing Rice, who has family ties to Maine, at a confirmation hearing for U.N. ambassador.

COLLINS: The people of Maine are proud of what this remarkable woman has accomplished.

BASH: Whether Collins supports Rice now for a promotion is crucial because of the raw numbers. Rice would likely need 60 votes to overcome a filibuster by these GOP senators. Assuming all 55 senators who will caucus with Democrats next year vote to confirm Rice, she would still need five Republicans to get to 60. It's hard to see where those five GOP votes for Rice would be if even moderate Collins doesn't support her.

To be sure, the president has not nominated Rice for the post yet. Another Republican senator who met with Rice made clear he thinks it would be a mistake.

SEN. BOB CORKER (R), TENNESSEE: We want someone of independence. I would just ask the president to step back for a moment and realize that all of us here hold the secretary of state to a very different standard than most Cabinet members.

BASH: Rice isn't the only one whose attempts to calm criticism about the Benghazi attack appear to be backfiring. Acting CIA Director Michael Morell, accompanying Rice to the meetings, told GOP senators Tuesday it was the FBI that took references to al Qaeda out of these unclassified talking points Rice used for her TV appearances. But later in the day, Morell called to say he was wrong. It was actually his agency, the CIA.

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: I can't help but feel incredibly disappointed that we were told something at 10:00 a.m. that couldn't withstand scrutiny for six hours and that is totally inconsistent with what we were told the day before. We now have five different explanations of who changed the talking points to take out Benghazi and four different reasons. This is becoming a joke. (END VIDEOTAPE)

BASH: It is quite surprising that the acting CIA director gave incorrect information on something as politically explosive as the controversial talking points that Susan Rice used in a meeting with -- among the administration's chief Republican critics.

You know, the answer to why he did it according to senators is simply that he misspoke, Wolf.

BLITZER: So a quick question, Dana. Does that mean Michael Morell if the president were to nominate him to become the permanent director of the CIA, he would have problems getting himself confirmed?

BASH: You know, that's a great question. It's probably too early to say yes to that question. But there certainly is a lot of frustration not just with Susan Rice, but with the intelligence community, and right now the intelligence community is being represented by Michael Morell. And they are not getting the answers that they want from him and from others.

So, you know, it certainly won't be easy if he is nominated.

BLITZER: Yes, obviously. All right. Thanks, Dana. Thanks very much.

President Obama met with his Cabinet this afternoon. It's probably the last time we will see all of them together in the same room.

Let's bring in our chief White House correspondent, Jessica Yellin.

Jess, changes very likely in the Cabinet for the president's second term. What are you hearing?

JESSICA YELLIN, CNN CHIEF WHITE HOUSE CORRESPONDENT: Hi, Wolf.

Well, that's right. The president is still in that Cabinet meeting. He says they're going to talk about Hurricane Sandy, the fiscal cliff, some national security issues. But to your question, we already know that Secretary of State Clinton plans to depart, Treasury Secretary Geithner and even Defense Secretary Leon Panetta has made it clear he would like to leave within the year.

Jack Lew, the current White House chief of staff, is considered the odds-on favorite still to get the nod to become the next treasury secretary from the president. It's believed he has the greatest chance here it's believed of getting Senate confirmation. That leaves open the job of White House chief of staff.

And I'm hearing that among the names that are being considered for that role are Ron Klain, the man who was once Biden's chief of staff and did himself I'm told a great service in President Obama's debate prep. Despite that bad first debate, the president takes responsibility for it, does not blame Mr. Klain.

And another name that I have heard floated lately is Denis McDonough, a national security adviser in this administration who has earned the great respect and admiration of the president, a young man, somebody who is not often considered in that light, but the president admires him. But that, of course, leaves open the question who would take over for Secretary Clinton and for Leon Panetta. And those are some dicey questions right now given what Dana has just reported about Susan Rice -- Wolf.

BLITZER: Yes. And Michael Morell, this acting CIA director -- who's going to be the next CIA director? The president's going to have a full plate of nominations to put forward.

What did he say about Susan Rice today?

YELLIN: He was asked his thoughts on Ambassador Rice, currently the U.S. ambassador to the U.N. I will let you listen to his remarks and then we can talk about it. This is the president.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Susan Rice is extraordinary. Couldn't be prouder of the job she's done.

(APPLAUSE)

(END VIDEO CLIP)

YELLIN: There was an attaboy for her from the whole Cabinet, a little awkward, hard to tell if the applause was necessarily for Susan Rice or right before he said that he had also called out Secretary Napolitano and the General Shinseki from the Veterans Affairs Department saying it's their birthday. Perhaps they were also applauding the birthdays.

But I'm told the fact that Susan Rice is up on the Hill should not necessarily be read as an early sign that the White House is giving her sort of a pre-run dry run for a nomination, that this is in part because she wanted to go answer questions on the Hill to clear her name and that this was part of her desire as well. Of course, Senator Kerry also still I'm told a contender for either secretary of state, if not another Cabinet post as well -- Wolf.

BLITZER: Or secretary of defense if Susan Rice were to be nominated for secretary of state.

I think those applause -- it certainly did from that video clip sound like they were applauding Susan Rice and her role. And it looked like Hillary Clinton actually started the applause. She was sitting right next to the president, Leon Panetta on the other side of that Cabinet meeting. We will continue to watch this story as well. Jessica Yellin, our chief White House correspondent.

A little later, by the way, here in THE SITUATION ROOM, I will ask the Senate's number three Republican if his party will give in on raising taxes for the rich.

Also, for all of us waiting for tonight's half a billion -- billion -- dollar Powerball drawing, we are going to get some tips from a woman who struck it rich in another lottery.

(COMMERCIAL BREAK)

BLITZER: As we saw at that Cabinet meeting today, the president went out of his way to praise Susan Rice. Listen once again.

(BEGIN VIDEO CLIP)

OBAMA: Susan Rice is extraordinary. Couldn't be prouder of the job that she's done.

(APPLAUSE)

(END VIDEO CLIP)

BLITZER: All right. So what happens if the president decides to be stubborn and nominate Susan Rice to become the next secretary of state?

Our chief national correspondent, John King, is here in THE SITUATION ROOM.

What would happen? Assuming there would be a filibuster, they need 60 votes to get her approved.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: It's a tough decision by both the president and Republicans if he makes this choice. We should emphasize that's a capital I, capital F, if he makes this choice.

Essentially, Susan Rice is seeing whether she can get minds that are dug in. Republican senators right now, that's what the secretary of state would have to do, with say China, with Russia. It's an audition of sorts even though the White House says it's no such thing. For the president, does he want to do this? He's going to have to cut a deal with Republicans on the fiscal cliff. He has other big issues he wants to deal with. He has several other Cabinet nominees he wants to get through.

Does he want to dig in here and pick a fight with someone he has personal loyalty to? For Republicans, if you look at the election results, what was their biggest problem? College-educated women and people of color. Do they really want to oppose the president nominating an African-American woman for secretary of state right now?

Both sides would have some dicey political choices. There's a lot of talk in Washington that Susan Rice is already undermined politically because so many Republicans say she should be a bad pick. It might hurt her in Washington, but, Wolf, you have covered world capitals. Think about the world.

If the president were to fight for her, again, that's an if, people would say she's obviously his person, he's loyal to her. Even someone like Colin Powell had that job, a person of enormous global stature, people always wondered, am I talking to George W. Bush or just Colin Powell? Will Colin Powell go home and be undermined by Dick Cheney, be undermined by Donald Rumsfeld? If the president fights for her, she might still be damaged a bit in Washington, but if she wins, her stature might go up around the world.

BLITZER: Because even if she were to be confirmed with let's say with 60 votes, there would be five Republicans would jump and endorse her, the secretary of state is supposed to represent everyone and be a bipartisan leader, if you will. It could be a little awkward though.

KING: It is awkward.

You're going into a second term. You want to build your legacy. The president is going to have to work Republicans on some tough other issues. Let's just go to domestic issues, the taxes and spending issues. Will Republicans give him tax increases, whether it's through reform or higher rates? What about immigration reform? Again, what about these other personnel choices? There will be some policy issue we're not thinking about today that will come up.

Does he want to have a partisan fight right out of the box? That's a big question. But the Republicans have to ask themselves the same question. Of course what they would tell you is, Mr. President, there's an easy pick, pick John Kerry, the Republicans like one of their own, he's a senator.

Guess what? They also have a political interest in that. If John Kerry is elevated to a cabinet position, they eventually has to be a vote in a special election in Massachusetts, Scott Brown just loss, maybe he'd win.

So, there's great political chess going on in addition to the president having to make a very tough personal and policy choice.

WOLF BLITZER, CNN ANCHOR: Yes. We'll see what he does.

John, thank you very much. John King reporting.

Republicans on Capitol Hill keep asking the president to show them where he wants to cut not just who he wants to tax.

Joining us now is the number three man in the Senate Republican leadership, Senator John Thune of South Dakota.

Senator, thanks very much for coming in.

SEN. JOHN THUNE (R-SD), REPUBLICAN POLICY COMMITTEE CHAIRMAN: Good afternoon, Wolf.

BLITZER: Before I get to the fiscal cliff and the taxes, spending cuts, are you ready to make an announcement on how you would vote as far as confirmation of Susan Rice is concerned if the president nominated her to be secretary of state?

THUNE: I'm not ready to make that determination right now. But I do think that her meetings up here have raised lots of questions. And there are more reservations about her now than there were before. And that's a problem for her at least with Republicans here in the Senate.

Whether or not she could get confirmed, I don't know. But I think she would have a considerable amount of opposition just based on the reaction some of my colleagues have had to the discussions they've had with her here the last couple days.

BLITZER: But you still have, can we call it, an open mind?

THUNE: Well, I have an open mind, Wolf. Clearly, I've got the same sorts of questions. But until we actually have a nomination put forward, I think it's all hypothetical. Obviously, she's somebody who has a lot of experience in working in the diplomatic core and someone who I think is -- has a long background of dealing in foreign policy issues.

But she's also somebody who hasn't been willing to answer some of the hard questions that many of my colleagues have had regarding the situation in Benghazi. And I think that demonstrates questions about her judgment and how she would be -- how independent she would be as secretary of state. And that's obviously something very important in a secretary of state.

BLITZER: Let's talk about the fiscal cliff. The president and other folks are hoping for a deal by Christmas. Is it doable?

THUNE: I hope so. I think there's, at least in my view, an opportunity here for us to do something that's really good for the country. But it has to be -- it's got to be entitlement reform included in anything that we ultimately act on.

We believe that in order to solve the country's fiscal solvency issues into the future, you've got to deal with the issue of entitlement reform. That's something so far the president has been reluctant to put on the table. And so far, what we've gotten out of him is this proposal to raise taxes which we think would be harmful to the economy.

And if you look at how much revenue that raises, $68 billion next year, that funds a government for less than a week. And it does potentially significant harm to the economy and raises taxes on the very people that we are asking to go out and create jobs.

BLITZER: Dick Durbin says when you're talking about entitlement reform or cuts in spending for Medicare, Medicaid, for example, he says that's too complicated now. Listen to what he said this morning.

(BEGIN VIDEO CLIP)

SEN. DICK DURBIN (D-IL), MAJORITY WHIP: When it comes to Medicare, we know that it's going to run out of money in 12 years. Whatever changes we want to make should be thoughtful changes not made in the heat of the fiscal cliff.

(END VIDEO CLIP)

BLITZER: Can you defer Medicare for example -- Medicare reform until after you get a deal on the fiscal cliff?

THUNE: Well, if we do that, Wolf, I think what you have to do is also defer the issue of taxes. I think you extend tax rates some time into the foreseeable future whether that's six months or a year and allow us to go through the process where we can deal with entitlement reform and tax reform in regular order. I don't see Republicans supporting something up here that deals with taxes that doesn't have entitlement reform incorporated into that.

So I think right now we're a little bit of a standoff, but the way to solve this, of course, would be of course to extend the existing tax rates, which is by the way something the president agreed to two years ago when economic growth was stronger than it is today. At that time, he said we shouldn't be raising taxes when we've got a weak economy. That would be a bad idea. Growth today is actually significantly lower than it was two years ago when he made that statement.

We agree it's about jobs and the economy. That's what the president said after the election that he wanted it to be his goal and his priority. We have a difference of opinion about how to get the economy growing again and expanding again. And obviously we have a big interest in making sure that we address the fundamental problem and driver of federal deficits and debt. And that's reforming these entitlement programs that are on an unsustainable path right now.

BLITZER: So -- but remember the president also said when he extended the 35 percent tax rate for the upper income for those making more than $250,000 a year, he says that was -- he said then that was the last time he was going to do it. It was a one-shot deal. He wasn't going to do it anymore.

And as you know, he ran his re-election campaign on the notion he was going to increase the tax rates from 35 percent to 39.6 percent for those people making more than $250,000 a year. You think he's likely to blink on that?

THUNE: You know, I don't know. I hope -- I hope he is at least willing to work with Republicans. Republicans are open for business up here.

If he wants to bring entitlement reform into this discussion -- and you made the comment or showed Dick Durbin's comment this morning about that would be too hard to do. Well, all the work's been done. You've had Simpson-Bowles. You've had Domenici-Rivlin. You've got a lot of work out there that's been done.

We all know what the issues are. We all know what it's going to take to solve that problem. If we can't get that done now, we ought to -- we ought to extend the existing rates into next year.

Look, if you raise taxes right now, you -- according to the Joint Committee on Taxation -- raise taxes on a million small businesses that employ 25 percent of the work force. Ernst & Young has a study out there that said that would cost us over 700,000 jobs in the economy, reduce economic growth by 1.3 percent and lower take home pay for Americans. That's not something we want to do in the midst of a weak economy.

BLITZER: If -- THUNE: Go ahead.

BLITZER: Yes, sorry to interrupt.

But if the president, let's say, went along with this notion, you know what? We'll defer entitlement reform until next year when we can do it thoughtfully, seriously, we'll defer tax increases until next year when we can do major tax reform across the board thoughtfully, seriously. Let's say we extend the current levels of spending and taxes for six months, maybe even a year, as part of this stopgap measure over the next few weeks before December 31st, would you be willing -- you, Senator Thune -- to raise the debt ceiling right now so you don't have this fight in February or March when it comes up again?

THUNE: You know, I think the debt ceiling is something that we would be willing to entertain a conversation about if that would help us get an extension of all these rates and let us do entitlement reform and tax reform, pro-growth tax reform, the way it ought to be done in regular order. You know, obviously, it would depend of course on what kind of request the president makes, how much he wants to add to the debt ceiling, what kind of commitments we can have in terms of spending reductions that would occur to be commensurate with that.

I don't think Republicans want to raise the debt ceiling unless we have a commitment, a hard commitment about spending reductions. We went through this in August of 2011. We were able to get some important concessions.

Our members want to see spending reductions. They want to see a commitment on entitlement reform. And so far, we haven't seen that from the president.

But if we could get an extension of the things that you mentioned, Wolf, and deal with this in an orderly way next year, I think that would be a solution that would attract considerable amount of Republican support.

The question on the debt ceiling, I'm not sure about. It depends entirely on how the president and what he would submit to us.

BLITZER: All right. Senator Thune, thanks very much. Senator John Thune.

(VIDEO GAP)

BLITZER: In the leadership, appreciate it very much.

We're going to get reaction to what he just said as well about deferring everything for six months or a year, dealing with it more thoughtfully in the new Senate, in the new House of Representatives, but in the meantime allowing the current tax rates to continue for the time being, spending to continue for the time being as it currently exists. But get over that debt ceiling issue right away.

We'll see what the White House says about that. Mitt Romney dreamed of living in the White House. He's going to have a chance, at least going to settle in for a lunch date with the president tomorrow. Stand by.

And a pack of cigarettes could have a new look with new language about what tobacco companies did to hide the risks of smoking.

(COMMERCIAL BREAK)

BLITZER: Lisa Sylvester's monitoring some of the other top stories in THE SITUATION ROOM right now, including a bloody day -- another one, in Syria's civil war.

What happened?

LISA SYLVESTER, CNN CORRESPONDENT: Yes. That's right, Wolf.

Syrian activists say at least 45 people were killed in two car bombings outside the capital of Damascus. That city has been a sanctuary for pro-regime Syrians forced to flee their homes because of the war. The rebels meantime have claimed to down three fighter jets in the past 24 hours.

And, Wolf, we'll speak with CNN's Arwa Damon from northern Syria later this hour.

A federal judge is ordering tobacco companies to publicly admit they deceived Americans about the dangers of smoking. The court ruled that big tobacco should print the admission both on the box and through advertisements. It's not clear if tobacco companies will appeal this decision.

And the self-described king of motivation has died at the age of 86 years old. Zig Ziglar best known for his seminars and more than two dozen books on salesmanship. He died in Dallas after getting pneumonia.

Yes, he had quite an influence. You know, he had 30 books or so over the course of his life.

BLITZER: Yes.

SYLVESTER: So, what a life he led, Wolf.

BLITZER: Yes, quite a following.

Thanks very much, Lisa, for that.

Republican Saxby Chambliss raised eyebrows when he said he might break the anti-tax pledge. That statement could also draw him into getting a new primary opponent as far as his re-election is concerned, primary opponent who also happens to be a CNN contributor. We're going to speak to that contributor, next.

(COMMERCIAL BREAK) BLITZER: All right, let's get right to our "Strategy Session." Joining us our CNN political contributor and Democratic strategist, Hilary Rosen and also our CNN contributor, Erick Erickson, he is editor-in-chief of conservative political blog, redstate.com.

Guys, thanks very much for joining us. All right, Erick, clarify this. Are you going to challenge Saxby Chambliss for the Republican senatorial nomination? He is up for re-election in 2014.

ERICK ERICKSON, CNN CONTRIBUTOR: If it's not me, I hope someone does it. It's not until 2014. I've been very dismissive of calls saying run for this thing. But in the last couple days, I've gotten a lot of calls from some prominent folks that are throwing out dollar signs of what they can raise and I think I need to treat them more seriously than I have been.

I think it's more a barometer of angst with Saxby Chambliss than anything that there are people calling me wanting me to run. My wife is firmly in the, "I will bury you in the backyard if you run camp." So I mean, the odds are against it, but it's certainly something to look at.

BLITZER: He's a pretty conservative guy. I've known Saxby Chambliss for a long time, represents Georgia. What so bad about him?

ERICKSON: Well, you know, Wolf, the problem with Republicans in the last 10 years or so, is that you have a lot of people who call themselves conservatives thought of conservatives that amount to what I call pro-life status.

They say they love the babies in utero or not, but they want to raise taxes or spend as much as the other side. When Saxby Chambliss got to Washington and what the federal spending is more than twice what it was then.

He's big on agricultural subsidies. He's big on defense spending and those aren't bad things, but at the same time, you know, if Republicans are going to return to their roots and try to be fiscally responsible.

They need to stop sending guys to Washington who are OK with the spending as long as they're not raising taxes or in Saxby's case pledging to not raise taxes other than saying maybe I will.

BLITZER: Hilary, you're a good liberal Democrat. It's probably hard for you to believe that Saxby Chambliss isn't conservative enough for someone like Erick or other conservatives.

HILARY ROSEN, CNN POLITICAL CONTRIBUTOR: It's never hard for me to believe someone isn't conservative enough for Erick. What my friend will find when he gets to Congress if he ever gets there is something that my other good ideologue friend Barney Frank always says, which is I was pure until I had to cast my first vote.

All of a sudden that kind of ideological purity doesn't really work. What I'm not surprised at though is this hole that Republicans find themselves in, which is this inconsistency that some spending is OK like if it's agricultural subsidies or, you know, tax subsidies for oil and gas, but other spending is not OK as if it's like tax cuts for the middle class.

I think, you know, for Erick to be out there on a platform of saying, you know what, the president is wrong. Tom Cole, Republican member of Congress is wrong. We shouldn't, you know, pass what we can agree on, which is a tax cut for 95 percent of the American people, protect middle class tax cuts. What we have to do is fight to the death even over the fiscal cliff to protect tax cuts for wealthy people --

ERICKSON: What about -- it's not about protecting tax cuts for the rich.

ROSEN: That's what you're attacking him for.

ERICKSON: No. I don't think government should do symbolic things. You raise the taxes on the rich, you get eight days of spending -- you get eight days of taxes. Where are the cuts coming from?

What these guys did, this so-called fiscal cliff is a bipartisan deal, it's the root of a bipartisan deal and they ought to go on and take their medicine. We're trying to say right now we're going to trust the guys who came up with the fiscal cliff to get it right this time. There have been 18 debt and deficit commissions since 1980.

ROSEN: So you're saying they came up with spending cuts that satisfied you, you would --

ERICKSON: I would go to the Clinton tax rates in a heartbeat if we got Clinton's GDP spending rates.

ROSEN: Well, you know, one of the things I think liberals are starting to resent also, Wolf, is that we are fighting so hard over this sort of modest issue of tax cuts for the wealthy. And people are completely dismissive about how devastating really entitlement cuts in Medicaid would be, cuts for daycare and teacher spending and other things.

ERICKSON: We can't solve the problem --

ROSEN: We're starting to feel a little antsy about as this conversation is only ends up being only about tax cuts.

BLITZER: You know, we just heard from Senator Thune, the number three Republican in the Senate. Erick, let me get your thought on this. He says, you know what punt right now, kick the ball down the road six months or a year, deal with entitlement reform next year in a thoughtful way.

Deal with tax reform thoughtful in a new Senate, in the new House of Representatives, but just go ahead right now and avoid the fiscal cliff, keep everything as is right now for the time being. Erick, what do you think of that proposal?

ERICKSON: You know, if they want to buy themselves more time, sure, go ahead. But, Wolf, we've had 18 of these commissions and proposals since 1980. The national debt was $900 billion then. It's $16 trillion now. That's all these guys do is kick the can down the road.

They don't actually sit down and come up with plans. And when they do try to come up with plans, it's always either tax increases or spending that never pans out. They came up with a way to raise the national debt limit and then they don't want to actually do what they said they wanted to do in 2011.

BLITZER: Hilary, what do you think of that proposal, kick the ball down the road but in the meantime raise the debt ceiling so you don't worry about it in February or March?

ROSEN: I think the moment is now. The country wants to feel like this election was for something. President Obama was very clear in his campaigning about this balanced approach to a budget. And I think now is the time for people to kind of come to the table and act a little less pure like Erick would prefer, but also as far as I'm concerned a little more in the interest of sort of the average middle class citizen.

BLITZER: Erick, I'm going to leave it right now. But I want to read to you what hotline wrote about your possible bid for the Senate from George and then I'm going to get your final answer on this question.

Hotline was not kind to you. They said the Red State pundit is nothing if not a self-promoter and while he has deeply held conservative convictions may indeed prompt some genuine consideration of a political run. We'd be shock if this trial balloon amounts to anything bigger than a page-view promotion. Bottom line, are you in this seriously or not?

ERICKSON: I haven't even written about this at Red State. If they want to call it a page promotion or what have you, the hotline guys aren't a fan of mine, but it's something I'm going to consider.

BLITZER: He's considering it. You heard it here. We're not calling you senator yet. We'll see what happens down the road. Erick Erickson, appreciate it. Hilary, thanks to you as well.

It's very difficult to get an accurate look at what's happening in Syria's civil war. But today, CNN's Arwa Damon is inside Syria and the rebels are showing her how they're getting stronger.

(COMMERCIAL BREAK)

BLITZER: We now have a rare and important look at how Syria's rebels appear to be gaining momentum in their fight against the regime of President Bashar Al Assad.

Our senior international correspondent Arwa Damon is in Northern Syria right now. Today she and her team were able to visit an area where rebels say they shot down a Syrian government jet.

She's joining us by phone right now. Arwa, thanks very much. You've met with opposition fighters. Tell us what you're seeing in Northern Syria.

ARWA DAMON, CNN SENIOR INTERNATIONAL CORRESPONDENT (via telephone): Well, they took us to the site of where that jet was downed and it was scattered throughout an olive grove. Young and old alike were combing through it taking out -- picking out their war trophies, showing them off.

One old man said he was taking this to show to other villages that they could see what had happened to these planes. Because you have to remember that pretty much since this uprising began especially for the better part of the last year these fighter jets, the helicopters, the aircrafts, have caused such terror amongst the population that's standing up against the regime of Bashar Al Assad.

So for them this was a significant moment, a significant victory, to be able to see the fighter jets that have caused them so many nightmares now turned into a heap of metal. We spoke to one man who said he was picking olives nearby. He saw the plane being hit.

He saw the two pilots ejecting. He and others there then said they did find one of the pilots unconscious with a head injury. They told us that they took him to a makeshift field clinic to treat him. We did see YouTube video of that although we don't know what has happened to him since then.

But this is not an isolated incident, which makes it so significant. In this particular area, Wolf, which is around 16 miles away from the city of Aleppo in the span of just 24 hours rebels are claiming that they did not just bring down this particular fighter jet but two helicopters as well.

BLITZER: Arwa, it's been a few months since you were last inside Syria. How dramatically have things changed?

DAMON: Pretty dramatically. The rebels have made significant developments when it comes to territory that they do control. The fact that they were able to bring down these fighter jets, these helicopters, is as a result of them being able to take over a very large base that is around a half-hour drive away from where that jet was brought down.

And what they found on this base was a real treasure-trove of weaponry and especially for them because what they have been asking the international community for is some sort of ability to be able to take down these aircrafts. And on this base they told us that they found hundreds of anti-aircraft soviet-era missiles.

And we could see video posted to YouTube as well that did show metal boxes packed with these missiles. And they are tells us that that is what they used to bring down these aircrafts over the last 24 hours.

So while at this point the regime does still have the military advantage because of the sheer size of its arsenal, many are viewing this development as perhaps beginning to slightly shift the balance. We are seeing them gaining significant amount of territory. We are beginning to see this rebel fighting force trying to organize itself a little bit. Fully aware of what a challenge it is and incredibly frustrated with the process in and of itself. So the landscape is really changing by the day here.

BLITZER: Arwa Damon in Northern Syria for us with the rebels watching what's going on. Arwa, be careful over there. We're going to stay in close touch with you obviously.

We can certainly take it for granted that Albert Einstein was a whole lot smarter than you or me, but now we're learning why he was such a genius. No surprise the secret lies within his brain. Our own Dr. Sanjay Gupta has new information.

And trying to nuke the moon might not necessarily sound like a genius idea, but that didn't stop American officials from hatching that plot during the Cold War. Brian Todd's standing by.

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BLITZER: Sounds preposterous, but the United States actually hashed a plot during the Cold War to possibly nuke the moon. Brian Todd's got the latest on this bizarre story. I'm tempted to say and I will, what were they thinking?

BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, all sorts of wild ideas were floating around in the halls of government back in the 1950s. It was the height of the Cold War, security scares all around. American leaders felt they need to give a jolt to the Soviet Union. So at the time this didn't seem so outlandish.

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TODD (voice-over): Just think of what a nuclear explosion would look like up there. The U.S. government once considered it. CNN has documents and interviewed the leader of a once-secret Air Force project innocuously titled "A Study of Lunar Research Flights" with a low brown nickname "Project A-119." What was it really?

LEONARD REIFFEL, LEADER OF MOON NUCLEAR BLAST PROJECT: To evaluate the value of putting a small -- emphasize small in this world anyhow, nuclear explosion on the moon.

TODD: Physicist, Leonard Reiffel, now 85 years old led the project in 1958. It was the height of the Cold War. America and the Soviet Union were in a nuclear arms race. The Soviets had just launched the world's first satellite "Sputnik" and were ahead in the space race. U.S. officials needed a big splash.

REIFFEL: People were worried very much by "Sputnik" and the very great accomplishments of the Soviet Union in those days and in comparison the United States feared -- was feared to be looking puny. So this was a concept to sort of reassure people that the United States could maintain a mutually assured deterrence and therefore avoid any huge configuration on earth. TODD: According to Reiffel's now declassified report on the project, team leaders also thought they could get information concerning the capability of nuclear weapons for space warfare.

(on camera): Reiffel says the plan called for an intercontinental ballistic missile to be launched from an undisclosed location, travel 240,000 miles to the moon and detonate on impact.

Various news reports say they considered using a bomb the same size as the one dropped on Hiroshima. But Reiffel now says he wasn't in on those discussions.

(voice-over): Could the blast as some news reports suggest have actually blown up the moon?

REIFFEL: Absolutely not. It would have been microscopic so to speak. It would have left a crater I think essentially invisible from earth even with a good telescope.

TODD: Reiffel had some brilliant minds on his team, one of them an up and coming graduate student named Carl Segan who went on to be one of the most world renowned astronomers.

REIFFEL: We brought him onto look at the propagation of a hypothetical cloud.

TODD: Later on he says, Segan violated security when he mentioned the still-classified project on a job application. Sagen's widow told us she's not sure if he ever did that, but if he did it wasn't intentional. By 1959, Project A-119 was drawing more concern than excitement and was abandoned.

REIFFEL: We didn't want to clutter up the natural radio activities of the moon with additional bits of radio activity from the earth.

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TODD: And Reiffel says other factors in killing the project were that they were not sure of the reliability of the weapons. The possible deterrent against Soviet Union wouldn't have been worth the gamble and there would have been a lot of public backlash in the U.S. Contacted by CNN, the Air Force would not comment on Project A-119 even 54 years later -- Wolf.

BLITZER: And you say there was also talk of having nuclear weapons in space.

TODD: That's right. You know, we talked about that in the piece. But Reiffel said generally in military circles at that time they discussed as having the moon as a military high ground. It sounds crazy, but it involved in having nuclear launch sites on the moon, nuclear launch sites.

The thinking was if the Soviets hit the U.S. with nuclear weapons first and wiped out our ability to strike back, the U.S. would strike from the moon. And Reiffel says these are horrendous concepts as it what he calls them. He says he hopes they stay in science fiction forever.

BLITZER: I love going back and seeing what they were thinking about doing back in the '50s, a whole different era. Brian, good report. Thanks very much.

Most of us won't need advice on how to spend a lottery jackpot. But our guest knows the feeling of seeing the winning numbers on a ticket and asking herself what's next.

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BLITZER: Lisa Sylvester's monitoring some other top stories in THE SITUATION ROOM right now including violence flaring once again in Egypt's capital. Lisa, what's going on?

LISA SYLVESTER, CNN CORRESPONDENT: Wolf, police and protesters scuffled near Cairo's Tahrir Square with some arrests of young people. Many are still upset by President Mohamed Morsi's move to consolidate his power. The Muslim Brotherhood is planning nationwide rallies to support the president this weekend. The council writing Egypt's new constitution meantime says it has almost finished its final draft.

And the EPA is temporarily banning BP from competing for new government contracts. In the wake of the 2010 gulf oil spill, the agency says it is taking action because of BP's, quote, "lack of business integrity." As of February, BP had $9 billion in contracts with the feds. BP says it expects this ban to be lifted shortly.

And the manager who oversaw Apple's flawed maps program on its new iPhone has been fired. Rich Williamson was fired just before the Thanksgiving holiday. He had been with Apple for about a decade. The flawed maps app forced CEO Tim Cook to issue a public apology after the iPhone's debut in September.

And if you've ever dreamed of an intimate dinner with Betty White, well here is your chance. A Los Angeles chapter of the Society for the Prevention of Cruelty to Animals is auctioning off a date with the actress.

The winner will join white and the SPCA's Los Angeles president for dinner at one of her favorite restaurants. The minimum bid get this, Wolf, it's only $1,000. So I think we're going to have a number of takers. What do you think, Wolf?

BLITZER: I think there will be a lot of them no doubt about that. She's a very, very popular lady. Lisa, thank you.

The first lady of the United States, Michelle Obama, today showed off the White House Christmas decorations. She had some very special guests.

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MICHELLE OBAMA, FIRST LADY: We are also honoring our military families with some very special decorations on the official White House Christmas tree that's in the blue room. It's the biggest tree in the house. It's huge, stands close to 19 feet tall. It is one of my favorite trees.

This very special joining forces tree is covered with hand-decorated ornaments made by military children living in U.S. bases around the world. It's going to be a great holiday for everyone. And we are just excited to have visitors come through.

This is our official opening throughout the holiday season more than 90,000 people will come from all around the world to see this house. And I couldn't imagine a better way to get things kicked off by having all of you here with us.

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