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JOHN KING, USA

Pres. Obama Signs Landmark Tax Deal into Law; "Don't Ask, Don't Tell Vote"; "Don't Ask, Don't Tell" Vote; Gays in the Military; Breaking Down the 2012 GOP Field

Aired December 17, 2010 - 19:00   ET

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


JOHN KING, CNN HOST: Thanks, Suzanne. And good evening, everyone.

A huge Friday here in the nation's capital. The president signed into law the nearly $900 billion tax compromise, and it speaks volumes about the state of our politics that he felt compelled to take a minute to define just what compromised means.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Yielding on something each of us cares about to move forward on what all of us care about. All of us care about is growing the American economy and creating jobs for the American people.

(END VIDEO CLIP)

KING: Also the Congress is on the verge of making history. Our vote counts shows more than enough support for repealing "Don't Ask, Don't Tell" in the Senate.

We'll talk to the senator leading the repeat effort, Democrat turn Republican Joe Lieberman who among other things explains to us why he can't sway his good friend John McCain.

(BEGIN VIDEO CLIP)

JOE LIEBERMAN (I), CONNECTICUT: Because he's so stubborn, of course.

(END VIDEO CLIP)

KING: Katherine Miller says she's stubborn, too. She resign from West Point after deciding she could no longer lie about being a lesbian. Katherine Miller joins us with her thoughts at this historic moment.

But let's begin with your money and a truly remarkable signing ceremony here in Washington. There was humor.

(BEGIN VIDEO CLIP)

JOE BIDEN (D), VICE PRESIDENT OF THE UNITED STATES: This is a -- I was going to say big deal but an important deal.

(END VIDEO CLIP) KING: There was candor and there were Democrats and Republicans mingling amicably. And in the end, the president who for years reeled against the Bush tax cuts for wealthy Americans sign legislation that extends them two more years. That's the compromise thing.

The package also adds about $900 billion to the federal deficit even as both parties say it's urgent that Washington stops drowning itself in red ink. Does this add up to more jobs, more compromise, and might add up in the end to a second Obama term?

Let's dig deeper with David Gergen. He joins us tonight from Cambridge, Massachusetts. And with me here in Washington, Republican Alex Castellanos, Roland Martin and Dana Bash.

And to that point, to that point, yes, it's a big tax cut. Guess what? Your taxes are not going up next year. However, by the time the state of the union and all of the politicians here in Washington, David, we will be saying, we have to cut the deficit and the president knows that is coming. And so even as he celebrated today, he sounded this somewhat sober note.

(BEGIN VIDEO CLIP)

OBAMA: There will be moments, I am certain, over the next couple of years in which the holiday spirit won't be as abundant as it is today. Moreover, we've got to make some difficult choices ahead when it comes to tackling the deficit. In some ways this was easier than some of the tougher choices we're going to have to make next year.

(END VIDEO CLIP)

KING: So, David, was this give out candy now and tough choices later, or was this necessary candy for the economy and then we'll still have to do the tough choices?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: Well, it sure was give out candy now. I don't think the president had much choice, but to agree to the extension for upper income. But he got a lot in return, John. And the White House, I mean, they are surprised. They are calling the stimulus, too. It's as big as what he got the first year and nobody thought he would get another stimulus bill like this.

KING: David makes the point, Alex, that this is a big stimulus bill from the view of the White House, and the price tag is a little bigger than the last stimulus bill. Instead of this going into road, to bridges and highways, it's either tax cuts or not tax increases for people and then the payroll tax which is a little bit of a tax cut for people.

ALEX CASTELLANONS, REPUBLICAN CONSULTANT: It's a little bit of a tax cut but you nailed it. It's not a tax increase. We're not taking something away but we're not really adding anything stimulative to the economy now.

So, yes, we are not hurting people. Basically, we decided not to rob taxpayers and call it a Christmas gift. We're raising expectations beyond I think what this so-called stimulus is going to deliver.

I want to take a closer look at the package. I want to break it down for people at home that have not been following the debate. Let's take a look at the compromise package. This is the total pay. $860 billion that all gets added to the deficit. The state tax provision. Liberals thought that was a big get away to the wealthy, $68 billion. Extending the Bush tax cuts nearly $550 billion. And if you break it down, this is how it works out.

$463 billion for those $250,000 a year and below. $82 billion for the higher incomers, there's more unemployment benefits, there's individual tax credits and this is the payroll tax, the social security. That's taking your payroll tax out of the social security trust fund. That's $117 billion.

And in here, we say this is the new Washington. And among those $8.3 billion is ethanol. Dana Bash, ethanol, it gets its subsidies still. So some of it is still the old politics in Washington.

The question is, on a day like this, Mitch McConnell, the Senate Republican leader, right there for the president of the United States has not gotten a signing ceremony in the two years of the Obama administration. So is that a down payment on more of this, or is that just this is nice, Merry Christmas, let's go back to fighting?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: I wish I could tell that I thought it was a down payment. I'm more of that. Just for the sake of compromise and the idea that people actually in Congress can do the things that the voters said that they wanted them to do.

But right after he came back, or even while he was there, it was the same old, same old, I'm the floor of the Senate. Republicans and Democrats fighting in a very partisan way over foreign policy, the START Treaty and everything else. So I wouldn't hold my breath. But I thought it was very interesting that Mitch McConnell, the Senate Republican leader was there, the Democratic leader wasn't there in the Senate, and none of the Democratic leaders were there in the House. That is very telling as to how the Democrats feel about what the president did.

ROLAND MARTIN, CNN POLITICAL CONTRIBUTOR: This bill is truly hope that you can believe in, because they are hoping that it stimulates the economy. The first stimulus bill, one-third of it was tax cuts. You talk about a lot of money going towards infrastructure and building. They are hoping that this bill was somehow going to create jobs. No one can actually explain how that's going to happen. But they are saying, well, we think it's going to create jobs as per the economy.

CASTELLANOS: Who would have thought that the man was liking president because he was not George Bush just made the Bush tax cuts the Obama tax cuts. I think George Bush --

(CROSSTALK)

GERGEN: We'll call it the Bush tax cuts. CASTELLANOS: Send him a pair of cowboy boots, I think.

KING: Come back in, David.

GERGEN: Let me make a come back to this, but I want to disagree with my good friend Alex about the stimulus aspect of this.

There are a wide array of economists who actually believe now that this is going to add a considerable amount of growth. Mark Zandi, for example, and others. They are saying as much as half a percent growth would be additional to the stimulus. Now that can translate into jobs, real jobs, lasting jobs. So I think the president got, and I think the Republicans got a much bigger stimulus than expected.

The disappointment, John, is that they haven't done anything hard about the deficit. It was not accompanied by any action to show that they are serious. Now that we've done it, we've had the candy. What about the Castro oil, we're going to have to take next year? It's going to get a lot tougher on the middle class next year. And by the way, I think the rich are going to have to pay more, too, as they should.

KING: And that is the question, because what a lot of Democrats think here is you extend this tax cuts, so for the next two years, you're not going to get a tax increase, and so when you get around to dealing with the deficit, where does that money come from?

MARTIN: The people who were sitting here, who are dealing with homeless issues, foreclosure problems, going after food stamps, trust me, come February, they are going to feel this is where the cuts are going to come from.

If you're Secretary Arnie Duncan, you better brace for some serious cuts in education. So when you hear comments from Jessie Jackson Jr. talk about Obamanomics and Reganomics, what Democrats are saying is they are going to come up with the very same program with Mr. President that you want to protect. So you explain how you're going to protect them with the Republicans controlling the House.

BASH: It really is hard to wrap your mind around the fact that this is an $858 billion package that is not paid for. Obviously, Republicans announced that you can attest to them, believed that philosophically that tax cuts will help the economy so it's not really so bad, but I would also say that what David said about the fact that Moody's is another economists say that it will help the economy, that for sure was what put many, many Democrats in the end.

KING: That was the push in this.

BASH: That was the -- I mean, I hurts so many Democrats in the halls of the Capitol saying --

(CROSSTALK)

KING: One of the most interesting things to read is the second Charles Krauthammer calling it a week or so, essentially saying the Republicans got snookered here. And he uses a term we're all familiar when we covered Bill Clinton, a new bill Clinton back in the day, "Comeback Kid."

He writes this in the Washington Post today, "if Barack Obama wins re- election in 2012 as is now more likely than not, historians will mark his comeback as beginning on December 6th, the day of the great tax cut deal of 2010."

Alex?

CASTELLANOS: Krauthammer missed the boast on this one. His comeback began earlier. His comeback began on Election Day when Democrats lost the House and he was freed from that ball and chain that was pulling him left. Now he's needed to keep the liberal Democrats in check in the Senate so he has a case for his re-election. Republicans are needed to balance him.

So Barack Obama was re-elected when the Republicans won the House. And I think he's got a very strong hand to play.

MARTIN: This is the silliness to me of Washington, D.C., when last week he actually screwed up, now he's the prince of the city. This whole notion that somehow he has essentially guaranteed victory, I'm sorry, the map has absolutely changed.

The deal that what took place on November 2nd is still there. How will the Tea Party folks coming in in January change the dynamics of Washington, D.C.? There's way too many factors going on to somehow assess, somehow he's in a better position for 2012, not true.

KING: But David, Charles' point is based on historical models and the point you just expected.

If this juices up growth just a little bit, if the president can get up above to 2.5 percent, close to 3 percent growth, forget anything else. If you just go by historical models, the state of the economy, unemployment, GDP.

That's how -- you can fairly, with almost without fail, predict presidential elections just on that.

GERGEN: Well, that's right, John. But he's still got a very steep hill to climb on getting unemployment down to the numbers he needs. Even half a percent growth is not going to bring all of the jobs that he needs for re-election.

So I have to tell you, if you wake up today and you see a poll that says 27 percent of people, only 27 percent think that he's going to get re-elected. Another poll shows he's only got 40 percent approval. This has not ended his problems. He still has substantial governing problems, too.

But I have -- on the same breath, you have to say, if anybody had told us back on the Election Day that he was going to have this kind of lame-duck success, not only with taxes but probably with "Don't Ask, Don't Tell" and his good chance on the START Treaty, too, whoa, you know, that's a -- that is a - that's a - that's a turnaround that I don't think anybody expected to come -- to happen.

KING: Well, at that point -- hold that thought on that point. Let's take a quick break, because when we come back, we're going to dig deeper and explore the prospect of history. This week on the United State Senate on the point David just made, we found at the beginning of the week the repeal of Don't Ask, Don't Tell was dead. Well, tomorrow, the vote in the Senate could soon set it to the president's desk.

(COMMERCIAL BREAK)

KING: We overuse the word "historic" here in Washington but when the Senate convenes tomorrow, yes, they work in the weekend, it will be poised to make history. The House has already passed legislation allowing gay Americans to serve openly in the military. The Senate takes up that bill tomorrow - the repeal of Don't Ask, Don't Tell policy that was put in place 17 years ago during the Clinton administration.

Just a few days ago, it appeared unlikely the repeal effort would succeed this year because of Republican objections but supporters, led by Senator Joseph Lieberman in the Senate, pushed and pushed for a stand-alone vote on repeal.

And our CNN vote count, which has at least four Republicans now voting yes, shows that barring some last minute hiccup, the legislation will be on the president's desk by early next week.

I spoke to Senator Lieberman today before sundown so that he could observe Shabbat, the Jewish Sabbath.

(BEGIN VIDEO CLIP)

KING: I want to talk about the politics in the process in a minute, but step back for a minute.

JOE LIEBERMAN (I), CONNECTICUT: OK.

KING: This policy has been in place for 17 years.

LIEBERMAN: Right.

KING: What do you think it will mean culturally, not just for the military, but for the country?

LIEBERMAN: Well, I mean for the military, it will mean that Americans, who happen to be gay or lesbian who want to serve our country and are capable of doing so, can do so without fear of being pushed out simply because of their sexual orientation, not because they were ineffective soldiers or because they violated the code of military conduct.

In fact, 14,000 members of the American military the last 17 years have been discharged only because either they admitted it or somebody said they were gay or lesbian, and that's just wrong. But in a larger sense, I think really this is -- this is a civil rights action and in the best sense of America. This will allow gay and lesbian Americans to be called what they -- what they are, what they want to be called, which is Americans. Not gays or lesbians. Americans who want to serve our country.

And I think we've come to a point where neither your race, your gender, your nationality, your religion, or your sexual orientation should deprive you of the opportunity and honor of serving our country in the military and being called what they are -- patriots.

KING: It is controversial at the moment as most big things are. When we look back now on women's rights, including the vote to right, we look back now on the civil rights movement and the rights of African- Americans, they are looked at very differently with 10, 20, 50, 60 years of hindsight than they are at the moment. Will people look back in 25 or 30 years and look at this as as big a civil rights step as those?

LIEBERMAN: Yes, I think they will. I think also the people will look back at 20 or 30 years from now and say, I can't believe that there was a time when Americans were not allowed to serve in the military because of something very private like their sexual orientation.

Attitudes have changed in America. In my life, I would say probably the last two or three decades of my life, the most significant change in attitudes on a social question like this has been about gay rights and sexual orientation. I think the country is ahead of the Congress. And Congress, by repealing Don't Ask, Don't Tell, is going to catch up with the rest of the country.

KING: As you know and know well, not all attitudes have changed. Your close friend, Senator John McCain, was right here with us here last night and he said that he will vote no and this is why.

JOHN MCCAIN, (R), ARIZONA: The commandant of the Marine Corps said it's going to cost lives of Marines. The chief of staff of the Army said that it could cause destruction and he is opposed to doing it at this time. The chief of staff of the Air Force said at least wait until 2012.

KING: You're as close a friend that John McCain has, Senator Lieberman, why have you not been able to convince him he is wrong?

LIEBERMAN: Well, because he's so stubborn, of course. Look, we've had good conversations about this, John, and he is my dear friend. We just disagree. And in my opinion, every evidence says that this change can occur without any negative effect on our military effectiveness.

Some of our closest allies in the world allow gay and lesbian soldiers to serve -- the United Kingdom, Canada, Australia, Israel, just citing a few examples.

Also, the study done of 125,000 people are military answering questions. It was very clear that more than two-thirds are supportive of this. They think it could be done without negative effect. And even among some who felt worried that it would have an effect, more than 90 percent of those who actually have served with gay and lesbian colleagues in the military and in their own unit as opposed to those who haven't said it has no affect or it has a positive affect.

KING: If you search through the liberal blogosphere right now, and I know you do that three, four, five, six times a day, Senator, now, if you look through that right now, you will see a lot of people questioning the president's commitment's to this issue. They say, when he wanted to pass the historic treaty, he called in Henry Kissinger and the old Republican foreign policy guard, and then when things weren't going well, he brought in Colin Powell and did it again. And they say, sure, he's on the record for repealing Don't Ask, Don't Tell, but where are the high profile events, where is the public pressure on the United States Congress? Is that a fair criticism?

LIEBERMAN: I don't think it is. I know because I've worked so hard on this that President Obama fully supports the repeal of Don't Ask, Don't Tell, that in fact he's been on the phone talking to senators who were questionable and had an effect with that. And it was the president and Senator Reid who decided together notwithstanding the president's strong desire to have us ratify the START Treaty, to go first to the repeal of Don't Ask, Don't Tell. Get it done, don't let anybody hold it hostage to their votes on the START Treaty and then go back to the START Treaty.

So, I think the president has shown real leadership on this. And listen, he's the one that has helped make this repeal possible by saying that he was --he was for appeal as commander in chief.

KING: We've known each other for a long time. I'm going to ask you to let down your guard a little bit and reflect on the moment that a man, Senator Joseph Lieberman, who is viewed by many liberals as a pariah, was the Democratic vice presidential nominee, then challenged in a primary, beat in a primary by a liberal, then you came back and won that race as an independent, many liberals, Sir, just simply do not like you and you know that. And yet here it is, Joe Lieberman carrying the repeal of Don't Ask, Don't Tell to the finish line in the United States Senate. There's a more than a little irony there.

LIEBERMAN: May be there is certainly an irony on our very sort of hyper partisan politics in which people -- if you don't agree with him 100 percent of the time, they don't agree with you any of the time, and that's just not the way our politics should be. In this case, right from 1993 when Don't Ask, Don't Tell was first proposed, and I voted against it on the Armed Services Committee. I felt it was unfair and bad for our military slumber. So I'm very lucky and fortunate to have played a leadership role and now ending this injustice and doing something that will make the American military even greater than it is today. And, frankly, make our country even greater than it is today.

KING: Senator Joseph Lieberman of Connecticut, appreciate your time, sir.

LIEBERMAN: Thanks, John. Great to be with your.

KING: Take care.

When we come back, back to our feisty group, and the history and the controversial politics of "Don't Ask, Don't Tell."

(COMMERCIAL BREAK)

KING: Just how big of a deal will it be if the Congress and the president signs the repeal of "Don't Ask, Don't Tell." How big of a deal here in Washington, how big of a deal in the military, how big of a deal in the history books?

Let's get back to our conversation with David Gergen, Alex Castellanos, Roland Martin and Dana Bash.

David, you were in the Clinton White House back when this all started. When this was put on the books 17 years ago, Bill Clinton campaigned in 1992, I covered him then. He wanted to repeal -- flatly, he wanted to repeat and allow gay Americans to serve openly. He couldn't get that through. "Don't Asks, Don't Tell" was the compromise. How big of a deal is it now that it is poised to come off the books?

GERGEN: It's a big deal, John. I have to think that you have to go all the way back to 1948 when Harry Truman courageously as president integrated the Armed Forces by executive order and was threatened with a resignation possibly by Secretary of State George Marshal, but Marshal stuck with him. And Truman might have lost the election doing to that, but that went down because of military embracive and over time force -- the Armed Forces are the most integrative institution in the country.

I think this has similar magnitude. I was in the room when President Clinton made this decision back in 1993. Very late at night. Over a dozen of us in the Senate circle. He went to ask each person, how do you vote? It was 11 to 1 for "Don't Ask, Don't Tell."

You know, the person who really wanted to repeal it all together was Al Gore. But he lost. Lost graciously. And the president when he had -- I think everybody in that room today would say, it's time to repeal this. And it's the right thing to do. And thank goodness for Joe Lieberman. He deserves a lot of credit for this.

KING: And so why, Alex, will we get four or maybe a handful of Republican votes. Why is it so hard for Senate Republicans to do this?

CASTELLANOS: It's hard because some Republicans are very concern this is going to weaken the Armed Forces, but also because it's a social issue. The base of the Republican Party thinks that this is an opening for gay rights.

However, Republicans have hidden behind a wall for a long time, and that wall is, well, we will defer to the military. When they say we can do this, well, we will let it go, thinking that will never happen. Guess what, the wall has gotten so short now that they can't hide behind it any longer, and actually now it's an economic agenda. Social issues aren't dominating the agenda. President Obama can do this now and pay no political price I think. So I think you're going to see this go through.

MARTIN: I certainly believe that the economic conditions of this country, over the past four years, has contributed to this vote that's actually going to take place.

Because when you know -- I think back to Howard Dean talking about gays, god, and guns, not necessarily in that order, that was a dominating issue for so many people in terms of how do my religious views play in? And all of a sudden, though, when you have a newly electorate, younger voters coming in, you would say, you know what, I don't care.

Plus, the extent of this war plays a role when you say we are kicking people out who we need in the military just because they were gay? Forget that. If you can serve, serve. I don't care what you are. I think all of that combined play a role in change, not only for the Republicans but even conservative Democrats.

BASH: You know what's really interesting is why this is happening now and how this is happening now. You mentioned in the lead-in just last week, we all thought because Republicans were able to block the defense but which had this repeal in it that it was pretty much dead for the year, but it was really just late yesterday that Harry Reid said, you know what, I'm going to schedule this vote for Saturday. The Democrats in the Senate, including President Obama, then wanted to wait and say, you know what, let's wait and see if we get the START Treaty done, because we've still have a few days left before they leave for Christmas break.

When they do start the treaty, maybe if we have time, we'll take up this "Don't Ask, Don't Tell" repeal. They change their mind. They change their mind and said we're going to schedule it and do it before the START Treaty. That really is what sealed the deal as they clearly were getting momentum, getting more Republican on board.

KING: And the four Republicans, Snowe, Collins, Brown, Murkowski, originally it was, well, we are not going to do anything else until we fund the government, now they are on record saying, we're negotiating that, we're comfortable enough, you have our vote no matter what.

BASH: Right. I've talked to aides to all four of the Republican senators tonight, and they all said that it's pretty much unconditional at this point. They realize that the government will be funded in some way, shape, or form.

Actually, officially, the money runs out on Saturday night. The Senate tonight is going to at least do a short-term of fix to that. But regardless, they said that they are on board. And I'll tell that Senator Lieberman and other supporters think that they may actually get more than 60 votes at this point.

KING: Go, David, you have something you want to say?

GERGEN: You know, I just wanted to add one thing, because there are those who are very about concern what this will do to the military as Alex had said. But what's important about the legislation, John, is that it authorizes the military now to move at its own pace to get this done.

It is giving a little time to the Marine Corps to get this done right. I think most of us who have watched the military believe that with great confidence, the military will get this done quickly. Secretary Gates is fully behind this and head of the Joint Chiefs is behind it. But they are leaving the timetable to the military and that's very important to understand.

MARTIN: John, (INAUDIBLE) Texas A&M University president, it also helps to have a Republican Secretary of Defense leading this in terms of Bob Gates. But also, David, on one thing, Thurgood Marshall was always scared of all deliberate speed. So I understand, given them time, trust me, a lot of people when it came to issue of integration, there are still issues today, 50-plus years later. So I'm just saying watch the whole new issue of take their time.

KING: It is as a policy matter, it is a moment of history, whatever your views watching at home might be, it is a moment of history.

What has been interesting about the politics is the president has been criticized by some on the left saying, why aren't you doing more public events. Why not more high-profile public statements on this one. And even today, even today, we have known for 72 hours, right, Scott Brown is going to vote for this, Senator Murkowski, Collins and Snowe. We know the votes are there. And suddenly today, we get this email from OFA, Organizing for America, Obama's political organization saying, "Call Your Senator," on both the DREAM Act and this after bill.

But then David Gergen, up where you are, Saturday in Boston, Bay staters to rally to pressure Senator Brown. Why would the Democrats rally to pressure Senator Brown when he's already publicly disclosed that he's on your side?

GERGEN: I don't know. I don't get that, John, at all, because, you know, this is -- I think for -- you know, everybody thought that this was -- the people on the left were very fearful Senator Brown was going to be a complete, you know, sort of ideological conservative. He's turned out to be a pretty pragmatic senator. And on this issue, you know, he has a lot of military experience himself on the Jag Core and here he comes up and votes for it. I think, you know, for my part, I'm biased on this. I think it's the right thing to do. I salute him for it.

BASH: But you know what's interesting about Scott Brown on this issue. First of all, it's a little bit curious that they're doing that. Supporters of the repeal will say that they're not going to take any chances.

KING: I take it as part of the reaction, all the liberal criticism. Well, let's show we're doing something, but Scott Brown is already on the record.

BASH: No, but it's true. But this actually ties him to what David was saying about the fact that Secretary Gates and others are not going to do this overnight. During a hearing, a very important hearing a couple of weeks ago, Senator Brown got assurances from Secretary Gates that he would implement this until he is absolutely sure that they are worried about is taken care of and he got that assurance. So it's important for people to know even when the president signs this, it could be some time before it's actually repealed.

UNIDENTIFIED MALE: Obama administration has been activating their grass roots base on policy issues. I think these ties into it. But also when you look at his --

JOHN KING, HOST: Just a fire drill?

UNIDENTIFIED MALE: Absolutely. Even when you look at histories even when you look at the '60s and '64, African-Americans and others they say we trust your word John F. Kennedy, LBJ, we're not going to back off the pressure until we actually see it get done.

UNIDENTIFIED MALE: One of the things we're learning about this presidency though is that he's a solomonic figure. He sees himself as, this one will express their opinion and I'll stand above it all and bring them together at the end to work it all out with his powerful intellectual ability.

But that's not leadership. Leadership is sometimes getting out in front of the parade and I think that's I think that's why you see his base sometimes disappointed and saying, you should be out there on this issue and other issues.

UNIDENTIFIED MALE: They told him, Congress, you must change the law yourself to get this done.

KING: Time out for me right now. We'll continue the conversation. David, thanks so much, Alex Roland, and Dana. Thanks for coming in on a Friday.

When we come back, we're going to stay on this issue because we're going to go one on one and have a conversation with a woman who is at West Point. She was a cadet. She was there for two years then she quit. Why? Because she was a lesbian and tired, tired of living a lie.

Also, we'll give you a new way to look at the 2012 Republican field. Think of populous versus managers, where would you put Sarah Palin? Think about that one and Pete on the Street tonight, well, he's going to talk to calendar girls. That's something to do with politics. You'll like it.

(COMMERCIAL BREAK)

KING: The official policy of keeping homosexuals from serving openly in military dates back to 1950 when Harry Truman put in the uniform code of military justice that they could not.

In 1979, (Lenon Malcovich) was on the cover of "Time" magazine trying to lead the fight to repeal that policy. Back in 1982 though, Ronald Reagan said homosexuality was incompatible with military service.

That brought the debate into the 1990s. Bill Clinton campaigned on a promise to repeal it. Then, when he was president, he struck the current "Don't Ask, Don't Tell" compromise that of course, in 2006 the Supreme Court up held that and in 2008 Barack Obama campaigned on his promise of repealing it.

Allowing gay Americans to serve openly with end of policy that many of those discharge because they are gay say was discriminatory and demeaning.

(BEGIN VIDEO CLIP)

MICHAEL ALMY, FORMER AIR FORCE MAJOR: On my final day, I was given a police escort from the bases as I was a common criminal or a threat to national security and this was my reward after having served our nation in defense overseas in harm's way.

(END VIDEO CLIP)

KING: So what was it like to serve with "Don't Ask, Don't Tell" in place? And what might it be like after repeal? Katherine Miller was a West Point cadet until she decided she could no longer sit in a class where other cadets called homosexuality disgusting.

Katherine Miller is with us tonight. Katherine, take us back to your time at West Point? What was the worst?

KATHERIN MILLER, FORMER WEST POINT CADET: I think the worst was lying. I knew automatically since I got there that I would have to hide my sexuality, but what I didn't know is that I would have to actively portray myself as a heterosexual.

So I think lying to my classmates while I was living under an honor code that specifically said a cadet will not lie, cheat, tolerate those who do. That was bluntly contradictory to the West Point's morals.

KING: And when the issue of whether gay and lesbian Americans should be allowed to serve came up in classes or discussions at West Point, what were they like?

MILLER: I mean, for the most part cadets were apathetic towards the issue. They didn't care one way or the other, but there were minority cadets that were very vocal and saying that they thought homosexuality was disgusting. They thought it was a sin.

And I remember just sitting in those classrooms and feeling very vulnerable and defenceless. I didn't want to be labelled as a lesbian myself by speaking out against, you know, these individuals. So I had to be very, very careful about how I went about arguing that. KING: Let me ask this question. Playing devil's advocate, even though if it's a small minority who have those views, have discriminatory views, have, you know, sour views towards homosexuals.

Do you worry that perhaps the Army Chief of Staff General Casey might have a point where he has said he might find it disruptive to make this change or do you think the minority is so small that they can deal with it?

MILLER: Well, the fact of the matter is, there are already 60 or 70,000 gays and lesbians serving without any disruptions to unit cohesion as we speak. "Don't Ask, Don't Tell" isn't going to be -- the repeal is not going to be a distraction. We're service members first and we're going to adhere to that.

KING: When you say we're service members first, at the moment, you are not. What is next for you? What would you like to do?

MILLER: I will be reapplying to West Point and optimally, hopefully the Senate votes to repeal "Don't Ask, Don't Tell" and I will be able to enter West Point with the class of 2013.

KING: Is it as simple as that because you resigned your commission? Is it as simple as that or do you have to get now some sort of special waiver or a new commission to get back in?

MILLER: I do have to go through the exact same process that cadets trying that are trying to enter for next year's class. I have to go through it, but I would rejoin and pick up right where I left off pending I was readmitted.

KING: What do you think will be the most difficult part of the transition, assuming the Senate passes it this weekend, the president signs it into law next week, there would be a transition period. What do you think is the most difficult part for everybody involved?

MILLER: I think people are going to -- I think actually it's not going to be a very difficult transition. Like I said, there's already a number of gays serving in the military.

I don't anticipate a number of those to actually come out. We've seen prior models of "Don't Ask, Don't Tell," like laws repealed in other countries and they were terribly uneventful. So, I mean, in terms of difficulty, I don't foresee any problems occurring.

KING: And if there was an incident, maybe small scale, a few people say, I refuse, I refuse to stay in this unit. I refuse to sleep in the same area, should special accommodations be made or should they be told, too bad, get out?

MILLER: It would be the same thing as a racist being in a unit and saying, I don't want to serve with the black person. I mean, it's a very comparable experience.

You know, you're not in the military to be comfortable. You're in the military to do a job that transcend yourself. So I think of a service member cannot live under those conditions then it's he that needs to leave.

KING: Put it into context. You're young, obviously. So you weren't around in the Civil Rights Movement. You weren't around when women got the right to vote. But many of the supporters of the repeal have casted in that light as a landmark step in the Civil Rights progression of the United States of America. Is that how you view it?

MILLER: I mean, I see this as a matter -- not of LGBT quality, but as a matter of, this is in the best interest of the military to resemble the society it serves.

And like I said before, the gays are already in the military. By repealing this law, it's going to allow them to maybe just write home to their family and you know, their significant other without fear of losing their job for doing so.

KING: In the Senate, our count shows the 60, the 60 votes they to get over the procedural hurdle and pass this repeal, but a sizeable number perhaps a third or more of the United States Senate will vote no against the repeal. What do you have to say to them?

MILLER: They are on the wrong side of history. You know, I'm sure there are people who opposed desegregation of schools when Brown V. Board of Education occurred in the '50s, but they are on the wrong side of history.

KING: And no doubt Katherine Miller we'll see you return to the military?

MILLER: Yes, sir.

KING: All right. Katherine Miller, we appreciate your time tonight. A definitive short answer, we appreciate it. Best of luck in the days and weeks ahead. When we come back, big holiday news for victims of mega Ponzi artist Bernard Madoff.

Plus, a new way of looking at the 2012 Republican presidential field.

(COMMERCIAL BREAK)

KING: Welcome back. Another big CNN debate to put on your calendar and do it right now, CNN and the Tea Party Express will co-host a primary debate among 2012 Republican presidential candidates during Labor Day weekend next year. Mark it down.

And now let's check in with Joe Johns with the latest news that you need to know right now. Joe --

JOE JOHNS, CNN CORRESPONDENT: Hey, John. U.S. officials say the widow of one of Bernard Madoff's biggest beneficiaries will return more than $7 billion to Madoff's Ponzi scheme victims. They say Barbara (Pickhower's) forfeiture is the largest in U.S. history.

And a joyous holiday homecoming at Camp Pendelton, 2,000 marines and sailors reunited after seven months overseas. John King USA continues right after this.

(COMMERCIAL BREAK)

KING: When you try to breakdown the potential field of 2012 Republican presidential prospects, there are many ways to do it. You could divide them this way, governors versus members of Congress or northerners versus southerners, familiar faces and not so familiar.

In this week's "National Journal" cover story, veteran political reporter Ron Brownstein uses this divide, populist versus managers. Take a read and you'll see it's a smart look at the conflicting positions and more importantly the conflicting styles of the top GOP prospects.

Ron Brownstein is here to talk it over with us. We're also joined by a man plugged into what the right thinks of each of these prospects. Our CNN contributor and RedState.com editor Erick Erickson.

So populists versus the managers and when you stack them all up the potential field, you have Mitt Romney as the top manager. He fits the manager profile. He was a CEO and then you have Sarah Palin. She's the ultimate populist. Is it a substance issue or a style issue?

RON BROWNSTEIN, POLITICAL DIRECTOR, NATIONAL JOURNAL: I think it's more a style and tone than substance, but there is obviously some substance there as well. For example, Romney in the end supported the TARP program. Palin after initially supporting it with McCain, opposed it.

But largely, you're talking about a difference in style. The managers I think and Mitt Romney as you say is the clearest example of this, but Mitch Daniels sort of fall in this camp. Haley Barber more than not, a manager sell their economic competence above all. They are there. It's their resume, their agenda, and their record.

The populous, I think are selling much more cultural allegiance, cultural affinity, a posture towards elites and a posture towards Washington, a kind of tone of rebellion and rejection that is much more anti-elite.

Whereas the managers really kind of spring from the elite and I think each of them fundamentally speak to a different wing of the Republican Party, which is now roughly balanced equally in size between an upscale college educated, kind of traditional suburban Republican and this blue collar more populist Joe the plumber side of the party that has been growing for the last 20 years.

KING: And so Erick Erickson as you track this and you get on your web site every time one of them says something, I love it, I hate it, and somewhere in between, as Ron says it's a roughly even split right now if you go through the demographics and the polling and the like. Is there an ascendant versus a descendent, in your view of which you view is on the way up?

ERICK ERICKSON, CNN CONTRIBUTOR: Yes, I think there is a divide and as Ron says in the article. The managerial pick typically that becomes the Republican nominee. The Era Paron, the Bob Doles, the John McCains, the George H. W. Bushes, but every once in a while someone sneaks in and this is one of those wild card years I think.

Very much like a 1980 to a degree where you are going to see someone much more populist, much more connected to the base than an ideological gut level than you would in other years, which is why I think looking at the field I think there's an opening for other people someone like a Mike Pence for example.

KING: What about electability. Does that matter? We always talk about primaries or about ideology. Will Republican primary voters, when they're looking at this, do want a manager? Do I want a populist? If you look at that right now, the top manager, you have Mitt Romney polls a lot better against Barack Obama today than Sarah Palin. But does that matter to a Republican primary voter?

BROWNSTEIN: I think it matters to me. If you are going to make a cold, calculating decision, I think many of the Republican strategists would argue for a manager on the grounds that the opposition to Obama and Democrats among blue collar whites seems pretty deeply set.

And the white collar white, the college educated white suburban vote is more of a swing constituency for 2012. If that was your primary focus, I think you'd look at a manager with more ability to reach upscale perhaps than a Palin or a Mike Huckabee does who face kind of some cultural barriers with those voters.

But that isn't the only -- obviously, that is not the only consideration. That isn't the way it works. Right now by the way, even in the early polling you see a really clear divide among Republicans without a college degree, Palin and Romney are even Palin is ahead whereas in Gallup and Quinnipiac polling, Romney leads Palin, 3 to 1 almost among college educated Republicans.

This kind of wine track/beer track divide that we've seen in the past in Democratic races is already showing up in this Republican early skirmishing.

KING: And so Erick, when you consider that and look forward. If you look through and you do a great job in the magazine of breaking down some of the differences on issues, college educated Republicans, non- college Republicans.

They're roughly even on some issues like social security privatization that's pretty close. Change the constitution to end citizen birthright. That's roughly close, but there's a disagreement even on Bush tax cuts.

There's a disagreement over gays in the military. Where do you see this going forward or can we answer the question now? Does it all depend on will the dividing line be the state of the economy, will it be a tax cut fight, will it be about the debt?

ERICKSON: You know, I actually think we're going to start talking about more foreign policy in the next year, not just the economy. I think it's going to matter more than most people right now think. I would say that, yes, there is a dividing line right now and trying to get a pulse on it, the best way I can describe it is there are candidates on the managerial end of Ron's list, or in on the populous end that tap into something at the gut level with the base of the Republican Party that most of them don't.

It transcends regions. It transcends by enlarge their views on certain issues. But overall, I think at the base, at the grass roots level, the blue collar worker level if you will, as long as someone says they're good on life and they're good on marriage, they're going to focus on the economy.

They just want to be comfortable with those issues. It's going to be a sense of trust. For example, take Mitch Daniels. He's now made two consecutive statements about a truce on abortion that's going to hurt him with a lot of the grassroots social conservatives who aren't going to want to support him in the primary. Ultimately, though, everyone in the Republican Party wants to beat Barack Obama and it doesn't really matter who the nominee is as long as they have basic trust at some of these core principle levels.

KING: You know, at some extent what we're seeing here is the reverse of what we have seen in the Democratic Party and really over the last 20 years as we've lived through this class inversion in our politics where Democrats have run better upscale.

Republicans have run increasing well downscale. The Democratic primary has itself moved more toward a college educated affluent voter. That helped Obama beat Hillary Clinton. This is the flip side of that.

The Republican primary is moving to a position where these blue collar, non-college, as you say culturally conservative, conservative on foreign policy, not necessarily as focused on tax cuts. Those voters are growing in importance.

Even in '08 and a number of the southern and Midwestern states, they already 55, 60 percent of the vote and you have to think the balance could tilt even further because Republicans have done so well with those voters in the last few elections.

More of them can crossover and can participate in the primaries and that does help the populists have a better shot, you know as Erick said the managerial candidate usually wins, but the balance of power is shifting that it may not be guaranteed anymore.

KING: And if it's this crowded. You assume a crowded field, they view Obama as vulnerable. Therefore, you get more candidates who say why not? If I get the nomination, I have a one on one shot. Does that matter if you have three managers and three populist and a few people who sort of a little bit of both.

BROWSTEIN: I think three factors to determine whether the manager or populist has the upper hand. One, as you say, there are more viable managers dividing up the college educated side or more viable populists dividing up the other side. Second, who can cross over? Right now both Palin and Romney would seem to have problems. Palin faces a lot resistance among upscale Republicans. As Erick saying, among the blue collar Republicans, Romney is not an easy sell either.

The third big factor is what are we talking about? If the election is fundamentally about who is best positioned to revive the economy, to kind of manage the economy, that's an inherent advantage for the managerial candidates.

If it's more like 2010 Republican primaries where it's about who is more anti-Washington, who is going to go break more windows in the Capitol, who is going to really challenge the elite more, then that's an advantage for the Palin/Huckabee side of the equation.

ERICKSON: Yes, there's an extra dynamic I would throw in here as well from what I hear from a lot of Tea Party activists. I would say it goes beyond antidote to being data I hear it from so many people across the country.

That is grassroots activists are saying to themselves, who are the Karl Rove/Bushies going to go with, who were the McCain people going to go with and whoever they go with, the Tea Party activists will go in the opposite direction. I mean, it sounds very funny, but there's this visceral reaction to both of those.

KING: A visceral reactions matter in politics. Eric Erickson and Ron Brownstein. Thanks for coming in. Smart article.

And when we come back, still looking for that perfect holiday gift for the political junkie? Well, Pete Dominick joins us to look ahead to 2011 using an early stocking stuffer we sent his way.

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KING: So our off-beat reporter Pete Dominick hasn't been too naughty this year, emphasis on too. So we decided to send him an early Christmas present.

Hey, Pete, I see you got the package there. Open it up.

PETE DOMINICK: That's right. I got it today, John King. Thank you and now this is from you or from everybody at JOHN KING USA.

KING: Everybody, everybody -- from the collective JOHN KING USA group.

DOMINICK: Who wrapped this, Dana Bash?

KING: She's not a very good wrapper, actually no.

DOMINICK: All right, Mama Grizzlies 2011 calendar.

KING: What do you think? Open it to February. I want to test your Mama Grizzly knowledge.

DOMINICK: This is great, John. I am -- I mean, I used to have the "Sports Illustrated" swimsuit.

KING: Who is that?

DOMINICK: Michelle Bachman.

KING: Good for you. Good for you.

DOMINICK: Yes.

KING: All right, go to June.

DOMINICK: June. I am so excited. April. When is June? Who is that? I don't know who that is.

KING: You don't?

DOMINICK: June, there she is. I don't know. I don't know. Jennifer Aniston.

KING: Christy Nome, congresswoman from South Dakota.

DOMINICK: There she is.

KING: That's your favorite.

DOMINICK: There she is. Jan Brewer. I can tell you this --

KING: Have a great weekend, Pete. "PARKER SPITZER" starts right now.