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JOHN KING, USA

Rick Perry's Tax Plan; Herman Cain Ad Under Fire; Interview With Steve Wozniak

Aired October 25, 2011 - 18:00   ET

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


JOHN KING, CNN ANCHOR: Good evening, everyone.

Tonight, a Herman Cain fund-raising video goes viral because of a shot that celebrates smoking. Truth is, we think a cancer survivor like Mr. Cain should know better.

Plus, a provocative new tax plan from Texas Governor Rick Perry. Here's the form right here, a postcard, two sides, breathtakingly straightforward. And the modified tax plan would allow most Americans to keep their most cherished deductions.

(BEGIN VIDEO CLIP)

GOV. RICK PERRY (R-TX), PRESIDENTIAL CANDIDATE: Taxes will be cut across all income groups in America, and the net benefit will be more money in Americans' pockets with greater investment in the private economy instead of the federal government.

(END VIDEO CLIP)

KING: Most days, we would start right there. But breaking down the pros and cons of the new Perry tax plan will have to wait a moment, because just as he was putting the finishes touches on that bold plan on taxes and spending just what he needs to give his campaign a boost, Governor Perry also wandered into the foolish morass of the birther debate.

(BEGIN VIDEO CLIP)

JOHN HARWOOD, CNBC CHIEF WASHINGTON CORRESPONDENT: You chose to keep it alive in your interview with "Parade" magazine over the weekend? Why did you do that?

PERRY: It's a good issue to keep alive.

(END VIDEO CLIP)

KING: Well, no it isn't. And just hours after saying that, Governor Perry changed his tune.

(BEGIN VIDEO CLIP)

PERRY: That is one of the biggest distractions that there is going. We need to be talking about jobs. (END VIDEO CLIP)

KING: Great. Great, great, great. That's a much better answer. But how did we get here?

Governor Perry was asked by "Parade" magazine if he believed President Obama was born in the United States. The governor said, well, he just had dinner with Mr. Trump and that Mr. Trump questioned the authenticity of that long form birth certificate the president released back in April.

Then in an interview broadcast this morning, Governor Perry had a chance to put this foolishness to rest once and for all. Instead, listen here as the governor tries to have it both ways.

(BEGIN VIDEO CLIP)

PERRY: It's a good issue to keep alive. Just, you know, Donald's got to have some fun, and the issue is...

(CROSSTALK)

HARWOOD: It sounds like you really do have some doubt about it.

PERRY: Look, I haven't seen his -- I haven't seen his -- I haven't seen his grades. My grades ended up on the front page of the newspaper. So, let's -- if we're going to show stuff, let's show stuff. But, look, that's all a distraction. I get it.

I'm really not worried about the president's birth certificate. It's fun to poke it at him a little bit and say, hey, how about let's see your grades and birth certificate. But here's what really serious, is we have people sitting around, watching this interview tonight at home that don't have a job and this president has killed 2.5 million jobs. That's serious. And that's what we better get right.

(END VIDEO CLIP)

KING: Governor Perry could have, should have just said the birth certificate shows the president was born in Hawaii, case closed. Next question.

Instead, both with "Parade" and then in that CNBC interview right there, he tried to be cute, on the one hand calling it a distraction, but on the other hand saying thing like, it's a good issue to keep alive.

Well, it's not a good issue to keep alive. Keeping it alive feeds the conspiracy theories of people who range from a little loony to reckless and racist. I'm told that top Perry aides urged the governor today to be more direct, and less cute if the question came up again. And in South Carolina, today, it did, and he was.

(BEGIN VIDEO CLIP) PERRY: I will cut you off right there. That is one of the big of the distractions that there is going. We need to be talking about jobs.

(END VIDEO CLIP)

KING: Amen. But why didn't he just say that in the first place?

Joining us in New York, Republican strategist Ed Rollins, here in Washington, Obama campaign pollster Cornell Belcher, CNN chief political analyst Gloria Borger.

Ed Rollins, as the Republican, I want to go to you first. He's been a governor for 10 years. Yes, he's new to the national stage, but is it just he just he gave a bad answer, could have been more definitive, or is he trying to have it both ways and sadly perhaps play to the lowest common denominator?

ED ROLLINS, REPUBLICAN STRATEGIST: I don't think he's trying to have it both ways but I think it's a major mistake, and obviously he got it right on the third or fourth try. I don't know which that was.

This governor has to basically be very, very careful on everything he says. He basically is in a different environment than he's ever been in before. There's obviously a safety valve when you have been governor of Texas for continue 10 years in Texas. You're now dealing with national media. Everything you say cannot distract from your candidacy.

And he basically has to be talking about jobs, what he's going to do for America. Otherwise, we sit here having a three-minute discussion on this, as opposed to his flat tax.

KING: And to be honest, I would love, and we will in just a few moments talk about the flat tax, because taxes, spending, the economy are the number one issue facing the country.

But when you have, Cornell Belcher, a man making his national introduction, who is struggling at this point, he's gone down in the polls, we can show you the latest "New York Times"/CBS poll -- Governor Perry, who was 30 percent not long ago, now at 6 percent, Herman Cain, Governor Romney, Newt Gingrich, Ron Paul ahead of him.

It leads to the question, is this just inexperience or is it because he's at 6 percent does he think reaching out to the wacky fringe is just going to help him?

CORNELL BELCHER, FORMER OBAMA CAMPAIGN POLLSTER: There is an element there in America that is particularly in that base Republican group that wants to de-legitimatize Barack Obama so much that they won't be rational about it. The idea of him not being an American does resonate.

But I have got to tell you, not as a Democrat here, but as a political professional, I have yet to see this sort of level of inept campaigning on the presidential level in a good long time. The guy keeps getting in his own way. This is the guy who the outsiders wanted to challenge Romney and he's now behind Herman Cain and because he just keeps stepping on his own -- he can't complete a full sentence about sort of why they shouldn't vote for Romney and he keeps getting in his own way.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Do you remember when Joe Biden stepped on his own presidential announcement by calling Barack Obama clean and articulate and good looking?

BELCHER: Right, right.

(CROSSTALK)

BORGER: Well, this was like that.

BELCHER: And his campaign went...

KING: But Joe Biden didn't win.

What does it tell you -- I was talking to his people this morning. First they tried to say it's clear in everything he said about this that he thinks it's a joke. So I went back. I went back and I read it again, and looked at it again and listened to it again and it's not clear he thinks it's a joke.

BORGER: No. It's not clear.

KING: It's clear he's trying to be cute.

BORGER: He was given every opportunity by John Harwood of CNBC to sort of clear it up and he decided not to.

I don't think it's an issue that worked really well for Donald Trump, but I do think there's a part or the Republican Party that wants to have somebody saying these things, so he wants to have it both ways. In the end, though, he stepped on his own message on flat tax, which by the way, is a lot more important to people in Iowa which is what the governor of Iowa said today.

He said Iowa caucus-goers don't care about this. They don't share these views, is what Governor Branstad...

(CROSSTALK)

BELCHER: He's even getting in the way of me attacking him because I would rather attack him on the taxes than to be talking about this.

KING: Haley Barbour, who is now the governor of Mississippi, the former chairman of the Republican Party at a time the Republicans took back the House, he also says if Republicans are talking about anything but the economy they're doomed.

Ed Rollins, why is it -- Rick Perry is not the first one. Why is it that many Republicans on the national stage can't simply say, stop, forget about it, I have seen the birth certificate or there have been news reports about it, it says he was born in Hawaii, end of story, let's move on? Why can't they just say that?

ROLLINS: They should say that. First of all, it's irrelevant. The president's the president. He was born in this country. The issue is not about where he was born or what he did in his early youth. It's what he does today.

And I think the quicker we can make that case against him on a repeated basis and a consistent basis and what we're going to do to be different, we can move forward in this campaign.

KING: I think that is the most frustrating part that Ed makes, as, A., someone who wants to have a good policy debate in the campaign, and, B., as you talk to other Republican professionals, they say run against him on the economy, run against him on health care...

(CROSSTALK)

BORGER: It's not like there are not issues out there to run against Barack Obama.

KING: He happens to be the president. He's going to be on the ballot.

BORGER: Right. It's clearly a distraction. I think it reflects the insecurity of some of these candidates in the field, notably Perry today, because he's down in single digits in the polls. He's grabbing at anything he can.

He doesn't want to lose one voter, even if it's a voter who believes Barack Obama wasn't born in the United States, but it takes him out of the mainstream which is a huge problem for a candidate as you head into a general election.

BELCHER: But what if he really believes it? There is the crux of the problem. What if this is not strategy on his part? What if he genuinely believes that garbage? That's a frightening sort of thought, isn't it?

KING: That would be a frightening sort of thought.

I'm not here to defend Governor Perry. We're banging him around a little bit here, but he does have a fair point in saying, Ed Rollins, that reporters ask him about this. The media does raise this question sometimes and we expect an answer when we raise it, but he could just say, stop asking me stupid questions, could he not?

ROLLINS: That's exactly what he needs to do.

Unfortunately, the governor's had probably the first -- first impressions that he's made on the country are that he's not very smart or not very effective. Everything he has to do from here on out, he has to reinforce that he is smart, that he's been an effective governor, and you don't do this by the circus act. What works for Donald Trump is totally irrelevant. He's not a presidential candidate. These guys are presidential candidates. People are looking at them and making judgments, can they be the next president of the United States? And you don't get that merit badge by basically talking about idiotic things.

KING: Yes. And we played some sound from Karl Rove that we saw on FOX News, but we talked about this a little bit last night and Karl Rove says it marginalizes you with the bigger part of the electorate and maybe it should appeal to some fringe group.

I know you're a Democrat and you're a partisan, so I'm going to ask you to be as fair as you can. How does this issue play? If you look at the national polls, 80 percent of all Americans say forget about it, he was definitely or probably born in the United States. If you look at it among Democrats, Republicans, and independents, though, 69 percent of Republicans, 89 percent of Democrats, so there is that gap, three in 10 Republicans who have an open question on this.

But if you look at independents, if you think if you're the nominee, if you're the Republican nominee for president, in a close race, you need to win in the Philadelphia suburbs, you need to win along I-4 in Florida to get those independent voters. This issue can't work.

BELCHER: It goes nowhere, because it makes them seem -- now, look, it makes them seem out of contact with the regular voter who right now is worried about paying the bills, and keeping lights on, not whether the president was born in this country.

BORGER: And if you're sitting and managing Rick Perry right now, you're banging your head against the wall about this because you wanted him to be talking about the flat tax, you wanted to provide a contrast with Herman Cain, 999, up in the polls, you wanted to talk about what you can do to get the economy jump-started again, and instead, you're talking about the stupid birth certificate.

BELCHER: And really quickly he's got to run a perfect campaign from here on, because if he doesn't over the next month or so, his campaign's done, his money will dry up, and he's got to run the perfect campaign from here on out if he wants to stay in the race.

KING: We will end this conversation here. We're actually going to some spend time on that other part, though.

Cornell and Ed will be back with us a little bit.

Gloria, thank you.

And still to come here, smoking, we know it's bad for your health but might it be good for your political marketing?

And that new Perry flat tax plan, would you pay more or less? Is this bold plan his ticket back into the top tier? That's next.

(COMMERCIAL BREAK)

KING: It has a catchy slogan.

(BEGIN VIDEO CLIP)

PERRY: Today, I lay before the American people my Cut, Balance and Grow plan.

(END VIDEO CLIP)

KING: And it has the power of simplicity, a one-page tax form, a postcard to Uncle Sam, not a complicated stack of forms and tables. Just what Rick Perry says the economy needs and just what his campaign team hopes will help the Texas governor reverse his recent slide in the polls.

(BEGIN VIDEO CLIP)

PERRY: The future of America is too important to be left to the Washington politicians.

(APPLAUSE)

PERRY: To get America working again, we got to cut taxes and spending, balance the federal budget, and grow our economy and jobs.

(END VIDEO CLIP)

KING: Let's look at the highlights of the Perry plan, an optional 20 percent flat tax rate, you would keep your mortgage interest deduction, your charitable contribution deduction, if you make less than $500,000 a year.

You would get a larger, $12,500 standard deduction. A lower 20 percent corporate tax rate is also part of this. The Perry plan would eliminate taxes on estates, dividends, capital gains and Social Security benefits. Is it right for the economy, right for the Perry campaign?

Let's ask former Clinton Labor Secretary and U.C. Professor Robert Reich, "Wall Street Journal" senior economy writer Stephen Moore, and Republican strategist, economic guru Nancy Pfotenhauer.

Mr. Secretary, I'm going to start with you. You're the Democrat in the group.

The Perry campaign says this is fair for everybody, and they say by leaving those deductions, mortgage interest rates, charitable contributions, and the like and raising the standard deduction that it takes away the Democratic argument this is a plan that helps the rich, and hurts the poor. You say?

ROBERT REICH, FORMER U.S. LABOR SECRETARY: Well, it doesn't take away the Democratic argument and it doesn't take away the fairness argument because still people who are very rich, big CEOs pulling in millions of dollar a year, they can have a major deduction and they can have also a major cut in their taxes. Instead of paying 35 percent marginal tax rate, which is what they would have to pay under the current rules, they would go down to 20 percent.

Meanwhile, everybody else would be more or less off as they are right now, but you see if you're concerned about the budget deficit over the long term that means everybody else eventually will have to pay more. This is a kind of variant on the trickle down economics we have seen again and again Republicans propose. It doesn't work. Nothing trickles down. The median wage continues to drop.

KING: Let's -- the Republicans -- they're politely laughing, Mr. Secretary.

You disagree. You disagree. Steve, to you first. Why? Why is he wrong?

STEPHEN MOORE, SENIOR ECONOMIC WRITER, "THE WALL STREET JOURNAL": Well, first of all, this isn't the catchiest slogan. I still think 999 is catchier slogan than this.

But, look, first of all, the most regressive tax system that we could possibly imagine is the one that we have right now. We have got 20 million Americans that can't find full-time jobs, those people have no income.

So, Bob, I would simply say how can you do worse than the current system? But we just had this debate over the last month where liberals have been running around the country saying the rich aren't paying any tax on their income tax. The great thing about the flat tax is people like Warren Buffett won't have any more carve-outs, any places to shelter their income. Everybody will have to pay this 20 percent. There's no way to avoid that. I think a flat rate is a very fair system.

KING: If the biggest issue for the country right now is growth...

NANCY PFOTENHAUER, REPUBLICAN STRATEGIST: Right.

KING: ... creating jobs, do anything you can to create growth and jobs, Steve mentioned 999 -- is it 999? Is it this flat tax, a 20 percent rate? Newt Gingrich has a flat tax with a lower rate. I think it's in the 12 percent range. Is it the Romney approach which is more juggle the tax code?

Among Republicans, who has the best growth, jobs plan?

PFOTENHAUER: Well, I think it's between Perry and Gingrich right now. Because, frankly, I don't think that Governor Romney's approach, which is kind of nibble around the edges, is what's necessary. We need something that's going to actually stimulate economic growth.

I think the flat tax approach -- I appreciate the 999 plan, but I think the problem there is political risk, that if you could promise that we would have Herman Cain forever and that the sales tax and the VAT wouldn't go up, then that might be OK.

Absent that, a flat tax and particularly one that focuses on eliminating double the taxation on savings and investment is key. Doesn't matter what school of economic thought you're from. That's how you get to growth.

KING: Mr. Secretary, I don't think you were going on television today thinking you were going to defend Mitt Romney.

(LAUGHTER)

(CROSSTALK)

REICH: As a matter of fact, John, I didn't, and I'm not planning to.

Let me just say this. The real key problem right now in the economy is not that investors lack enough incentive, it's not that corporations lack enough money. Corporations are sitting on $2 trillion of cash right now. The real problem is consumers. Average consumers don't have the money. They have a huge debt load. They are scared of losing jobs.

Their earnings are actually dropping, largely because trickle down economics doesn't work. What we have to have, the only way of actually getting into this and reversing this vicious cycle is to have more, at least in the short term, more public spending, more investment in infrastructure, a WPA, Work Projects Administration, a Civilian Conservation Corps, directly employ a lot of these people.

I don't understand how Republicans actually with a straight face can say the rich need more tax deductions, they need lower taxes and corporations need lower taxes in this day and age.

(CROSSTALK)

MOORE: Let me just say one thing.

Bob, almost every economist agrees that our corporate tax rate is simply not competitive in the world. We have the second highest in the world. We're about 15 percentage points above the average.

So, Bob, you want to create jobs. I do, too. Let's make American companies competitive and let's bring that capital here, where it's creating jobs, rather than outsourcing it.

REICH: But, Steve, your point would be valid if we were not in an environment where corporate profits now, the ratio of corporate rate profits to wages is higher than it's been since...

(CROSSTALK)

MOORE: Because they don't want to invest, Bob.

(CROSSTALK)

MOORE: It's a lousy investment climate.

PFOTENHAUER: They are sitting on it because it is rational to sit on it. We have to change the entire schematic so that it makes sense and is rational for them to invest.

(CROSSTALK)

KING: It's not my job to say who's right or wrong.

But I would say, Mr. Secretary, that if you're right, you would unfortunately need the restoration of the monarchy to get your plan through because the Republicans aren't going to adopt a new WPA program right now.

REICH: Well, how about democracy, John?

KING: Well, we will have that. You do have an election in 13 months. We may get this to play out.

As this plays out among Republicans, as this plays out among Republicans, you know, Governor Perry makes his case today. I want to go back in time and show you an ad. This is a 1996 ad from Mitt Romney. We can show it on TV. This is when Steve Forbes put forward a version of this. The Forbes flat tax isn't flat.

He's essentially saying, if you read the fine print of this Mitt Romney ad, that this helps the rich and hurts the middle class. Governor Perry was asked about that by John Harwood of CNBC. Essentially, if Mitt Romney makes that argument against your tax, Governor, what would you say?

(BEGIN VIDEO CLIP)

PERRY: Well, I would say that he ought to go look in the mirror, I guess? I consider him to be a fat cat. But it doesn't matter to me what, you know, anybody says about this. I know what will work.

(END VIDEO CLIP)

KING: Might we, because of this proposal -- Governor Perry's had some stumbles, we were talking about some of them at the top of the program -- might we now get a good, interesting and important debate among the Republican candidates?

Secretary Reich of course will represent the Democratic side, and President Obama will represent the Democratic side. But might we actually get what's been missing frankly from this campaign, a state debate about the economy and jobs?

MOORE: I really think what this means is the Republican Party is a flat tax party now, right?

(CROSSTALK)

MOORE: We're in a great debate in the Republican Party. Do you want the 999 plan or do you want the flat tax? All of the bold ideas on taxes are coming from Republicans, and I think that it's going to be something like the flat tax.

PFOTENHAUER: I think so, too. These things have been debated for years. This one will not just work but I think it's politically salable, which is unfortunately a requirement here.

With all due respect to the former secretary, what he's advocating is doubling down on the same policies that this administration put in place, and that have abysmally failed. Doesn't matter if you're a Republican or Democrat if you don't have a job.

KING: To the point of this debate among Republicans, Newt Gingrich puts out a tweet today @NewtGingrich. "If you're going to bump tax plans with my friend Herman, then you can bump plans with me. Let's compare flat taxes."

So that's the debate the Republicans will have.

Mr. Secretary, let me let you in.

REICH: Well, let me just say, if the Republicans are all putting forth variations on a flat tax, when we have CEOs taking home 350 times more than average workers, a new record, when we have corporations sitting on $2 trillion worth of cash, a new record, when we have average working people paying through the nose for everything from health care to everything else, I mean, if Republicans want to say, OK, we're for a flat tax, we will reduce the taxes of people at the top, let Democrats say, and be the only ones out there saying, we have got to increase taxes on the only people who have the money and those are the people who are very rich, taking on the higher percentage of total income than ever before, certainly over the last 80 years.

That's fine. Let's have that debate. I think it's a debate that Democrats would love to have.

PFOTENHAUER: I think we'd love to have it as well, because that approach is one that has cost this economy millions of jobs. The flat tax, one of its greatest positive attributes, to be redundant, is that it's simple. And it's transparent. And therefore people can be held accountable.

The American people aren't dummies -- 10 percent of $100 million is a lot more than 10 percent of $100,000, particularly when the average family of four has a standard deduction of $50,000.

MOORE: Bob, the people who really hate this tax plan are tax planners.

PFOTENHAUER: Exactly.

(CROSSTALK)

REICH: I'm all in favor of putting tax planners out of business. But I would say, you can simplify the tax code much more directly by getting rid of a lot of the subsidies, a lot of the exemptions...

MOORE: This does that.

REICH: ... that big businesses, CEOs and others have put in there over the years. Let's have a simple plan, but a simple plan that is fair for average working people.

KING: I am glad -- I'm going to end this conversation right here, but I for one am glad we're starting to have this debate. I think this is exactly what the campaign needs.

(CROSSTALK)

KING: Mr. Secretary, thank you. Steve, Nancy, thanks for coming.

(CROSSTALK)

KING: And still ahead here, a member of Congress starts anew "Why can't we get along?" caucus and she's already worried it will be lonely.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: And if I'm one person alone, I will sit there and have a beer by myself. But that's what is going on in this country. People want us to get along.

(END VIDEO CLIP)

KING: And Herman Cain's chief of staff takes a drag and his video goes viral. Is that funny? Tonight's "Truth" is next.

(COMMERCIAL BREAK)

KING: Fresh evidence today of something we have been talking about here for some time now. Herman Cain is for real. And you dismiss the power of his candidacy at your own peril.

Look at this. The new CBS/"New York Times" poll puts Cain atop the Republican field nationally, and he's polling strong in key early primary, in caucus states as well.

But here's tonight's "Truth." It's time for Mr. Cain and his team to prove they take seriously the responsibility of leadership. And to that end, this is not a step in the right direction.

(BEGIN VIDEO CLIP)

MARK BLOCK, HERMAN CAIN CAMPAIGN: We have run a campaign like nobody's ever seen, but, then, America's never seen a candidate like Herman Cain.

(END VIDEO CLIP)

KING: The man taking a defiant drag there is Mark Block. He's Cain's chief of staff.

It's a testimonial video to Cain's appeal. But the reason it has gone viral is that non-P.C. smoking moment at the end.

When CNN questioned Block about his newfound fame he said, quote, "America needs to get a sense of humor." Asked why he felt it important to include the smoking shot, Block said, "I smoke; it's a choice."

Yes, humor is a critical ingredient in life and in politics. But so is leadership. Smoking is a choice, and Mr. Block and everyone else is free to make it, but to celebrate it is to encourage it. And it is indisputable fact that smoking kills.

The National Cancer Institute says of the 250 harmful chemicals in cigarettes, at least 69 cause cancer. In addition to cancer, smoking causes heart disease, strokes, asthma, cataracts and on and on and on, 440,000 premature deaths a year attributed to smoking. I can take you to the cemetery, meet my mother and father, if you're one of those who still think all of this is debatable.

Mr. Block is free to make his choice. All of us are. But that all of us includes young people like my two teenagers, who spend parts of their days checking out viral videos. My job: to police that; I get it. But anyone who wants a serious leadership position in politics has a responsibility, too. As Herman Cain's chief of staff, that responsibility extends to Mr. Block.

Make your choices. That is your right. But don't tell me I need to get a sense of humor when you use a political platform to encourage smoking. That's the same line your candidate used when he was called on the carpet for this.

(BEGIN VIDEO CLIP)

HERMAN CAIN (R), PRESIDENTIAL CANDIDATE: When I'm in charge of the fence, we're going to have a fence. It's going to be 20 feet high. It's going to have barbed wire on the top. It's going to be electrocute -- electrified. And there's going to be a sign on the other side that says, "It will kill you."

(END VIDEO CLIP)

KING: Joking about electrocuting people isn't funny. Neither is celebrating and encouraging a choice that can kill. As a tenacious survivor of stage IV cancer, I would think Mr. Cain would be especially mindful of the power of example.

Truth is, telling America to get a sense of humor isn't the answer. America has a pretty good sense of humor. What she cries out for is leadership.

Still ahead new details about Steve Jobs, the man. His close friend and co-founder of Apple, Steve Wozniak, joins us.

Plus, remember this?

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Do you regret using a rape reference to describe an opposition to... JOE BIDEN, VICE PRESIDENT OF THE UNITED STATES: I didn't use it, no, no, no. What I said -- let's get it straight, guy. Don't screw around with me. Let's get it straight.

(END VIDEO CLIP)

KING: Did the reporter who confronted the vice president, asked him that question, soon find his credentials no longer get him past Capitol Hill security? That's next.

(COMMERCIAL BREAK)

KING: Welcome back. Here's the latest news you need to know right now.

In the wake of Muammar Gadhafi's brutal treatment before he was killed last week, Libya's new National Transitional Council today reaffirmed its commitment to prisoners' human rights. A statement from the council says, quote, "We did not want to end this tyrant's life before he was brought to court." Gadhafi's body was buried in a secret location today.

Stocks closed sharply lower, due in part to jitters over tomorrow's European Union summit to address the continent's debt and banking crisis. Joe Biden's staff phoned a Senate official to raise concerns over conservative journalist Jason Mattera's tactics during a recent interview. At issue is whether Mattera was able to get close to Biden by misrepresenting himself as someone who wanted his picture taken with the vice president.

Mattera confronted Biden about comments he had made on the road, saying rapes and other crimes would increase if Republicans vote down police funding included in the president's jobs plan.

"ERIN BURNETT OUTFRONT" coming up in a few minutes at the top of the hour. And Erin, you're interested in this flat-tax plan, and you interviewed a top adviser to Governor Perry about it.

ERIN BURNETT, CNN ANCHOR: That's right. We're going to be talking about it, getting to the bottom line of whether it really works. I don't know, John, but I mean, I'm looking at the little postcard here, you know, the two-sided postcard that is the new Perry plan. But it looks an awful lot like the 1040-EZ, you know? Just a different font size. I know I'm kind of kidding. But we are going to get to the bottom line of whether this flat tax is really flat or something else.

Plus, the president courting Latino voters. He was on Jay Leno, as you know. And we're going to be talking to Bill Richardson about whether he's going to successfully get the Hispanic vote, which is so crucial this time around.

Plus, we can't resist. There's a little bit of a cigarette in that one tonight. Back to you.

KING: Aha. Can't wait. We'll see you there. BURNETT: All right.

KING: See you in just a minute.

And next, the private side of Apple's Steve Jobs. Insights from one of the people who knew him best, the Apple co-founder, Steve Wozniak.

(COMMERCIAL BREAK)

KING: It seems like every day we're learning more about Steve Jobs and his unfinished business plans. Multiple reports tonight say a full-blown Apple smart television might be on the way.

We're also getting glimpses of a much more personal side of Steve Jobs, the blunt, sometimes profane man we glimpsed on this clip from CBS "60 Minutes."

(BEGIN VIDEO CLIP)

STEVE JOBS, FOUNDER OF APPLE: I feel totally comfortable going, in front of everybody else, you know, "God, we really (EXPLETIVE DELETED) up the engineering on this, didn't we?" That's the ante for being in the room. So we're brutally honest with each other, and all of them can tell me they think I'm full of (EXPLETIVE DELETED), and I can tell anyone I think they're full of (EXPLETIVE DELETED). And we've had some rip-roaring arguments.

(END VIDEO CLIP)

(BEGIN VIDEOTAPE)

KING: Our next guest knew Steve Jobs and that temper perhaps better than anyone. Along with Jobs, Steve Wozniak helped start Apple Computer back in 1976.

Steve, let me start there, and I appreciate your time tonight. When you hear that clip, and you hear your friend's voice, what goes through your mind?

STEVE WOZNIAK, CO-FOUNDER OF APPLE: It sounds so much like the way Steve Jobs talks, and there's kind of an inner sensibility and, you know, kindness and sharing, reaching out inside of it, and yet sometimes it's, you know, it's kind of threatening.

I think it's also instructive. A lot of business people in companies all over the world and all over the country look and say, how did Steve Jobs handle these kind of situations, you know? And it's kind of like this, you know, it's partly a learning experience for other executives.

KING: I want to dig deeper into that. But I want to start here with the questions. A lot of people have questions about the future: how will this company survive? Will it thrive without its visionary leader? You were the first guy in line in your neighborhood for an iPhone 4S earlier this month. We're now hearing there could be an I -- and Apple, excuse me, smart television coming out. What's your sense of the future of Apple, post-Steve Jobs?

WOZNIAK: Yes, you know, it's hard to imagine there ever could be another Steve Jobs. You can't never say never. But Apple, as a company, people think, well, it's not going to be disrupted right away. Will the culture go on forever or after ten years, 20 years, will some other people be in control and it kind of goes negative and not the way Steve Jobs would have wanted it?

And I like to look at companies that had really great quality and engineering excellence. And I'll look at Leica Cameras, and they are -- they kept up their entire quality image and their position in the world of what they stand for, for 100 years. So company cultures don't have to dissolve and die and be -- you know, really variable, if they're really strong and good.

And everybody looks up and acknowledges, Apple, Steve Jobs; Apple, Steve Jobs. They go together. And the memories that are left over, I don't -- nobody, especially our customers, don't want a change to the way that Steve Jobs wouldn't like.

KING: One of the fascinating parts of this wonderful book by Walter Isaacson is a conversation between Steve Jobs and Steve Wozniak about the possibility, would you ever go back? Steve Jobs is gone now, but the same question, would you ever go back?

WOZNIAK: If I thought that I had something to offer to help Apple, of course I would. Apple, I'm so loyal. That company is, you know, the best company in my heart. But I have an awful lot of other life. I don't think I'm in a position in life right now where I would be the one to help Apple. People would be thinking, "Oh, my gosh, there's got to be some important role like Steve Jobs'." I don't tend to be that up-above, guide-everything, run-a-company type person.

KING: Another fascinating part of the book is Steve Jobs and his sister decide they're going to try to find their birth parents. He was adopted, and his sister goes out and does find them. And I want you to listen. Here, Steve Jobs acknowledges he found out. It was a Syrian restaurant. He found out it was most likely his father. Let's listen to this.

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JOBS: I was in that restaurant, once or twice, and I remember meeting the owner, who was from Syria, and it was most certainly him. And I shook his hand, and he took my hand, and that's all.

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KING: You ever talk about that? How did -- how did being adopted and for a long period of time not knowing who his parents were, how did that shape him? WOZNIAK: I don't like to go into persons' personal lives, so I've read about all of this stuff, never really spoken directly to Steve about it. To me I also think differently. The people that raise you are your mother and father. I would never want to go back and try to find a birth mother or birth father. And I wouldn't think that I would even believe that it really matters in my life. I am who I am.

Steve's -- Steve's adoptive parent, he didn't really think highly of them at all. He was very -- but a lot of people separate from their parents as they're getting out of high school. But his parents were just great. His mom was so nice. His father would try to instruct, show him things from laser work, physics that he did. I actually admired them.

But Steve, I don't know why, just didn't really -- I don't know. He didn't feel -- I think it bears to some other things he's done at Apple. He didn't ever have a feeling of family. And I felt that the first early people who started Apple, we all are family, which is one of the reasons I gave a lot of my stock to the others, was to give them a chance, because they had been so important in our big success. We shouldn't be the only ones.

But Steve kind of didn't want to go that way. "No, they don't deserve stock," and you know. I always want to take care of all of the people that are part of our group.

KING: I want to close with -- I work in Washington, so a lot of people here are focused on the political aspects in the book. And in the -- in the book, he makes clear, Steve Jobs does to Walter Isaacson, quote, "I'm disappointed in Obama. He's having trouble leading, because he's reluctant to offend people or piss them off. Yes, that's not a problem I ever had."

You talk a lot of politics with Steve Jobs? Why do you get the sense he thought Obama was not a good leader?

WOZNIAK: Well, we met back in the counterculture, you know, '60s, the Vietnam War days, and both shared -- we're pretty much a liberal viewpoint, a young person's viewpoint on that, and on just -- I don't know politics in general, government in general, just overriding the small person was what it wound up meaning to me.

Steve became a very strong leader who could actually change things, and the funny thing, so we both probably agree about Obama but for different reasons. You know, and what we really want to see more, whether it's just plain that he did take a stand and took some action or I care that he would take some more, you know, liberal actions like keeping up a lot of the words that got him elected.

So -- so Steve's just, coming from point of view, what you are is how you want to see other good leaders. You want to see other people that are good. In other words, if you're a leader, president of the United States and CEO of the company, see the similarity.

So Steve was a real strong one that could get things to turn out his way. The problem is, Steve could force the entire company to go on one course and keep its direction pretty steady. He had enough control to do that. Done mean you have to control every single person's life in the company. A president doesn't have that leeway, to be honest.

KING: Steve Wozniak, appreciate your time tonight.

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KING: You heard Steve Wozniak just moments ago talking about the Apple family. Well, tonight's "Number" here is personal for our family at JOHN KING USA: 6:09 a.m., this beautiful baby born to Michael and Jenny Waldon. You see them here. Michael is the producer who help me with the magic wall here all the time. He's a fabulous and valued member of our staff. His wife is beautiful. Their baby daughter weighing in a little more than 7 pounds. She's 19 inches long. She is beautiful.

She is yet to have a name. Now, I would suggest, Michael, how about Magic? Or Perfect? But that's your business. Congratulations to Michael and Jenny and their beautiful young daughter. We are thrilled here in the JK USA family.

When we come back, on the campaign trail here, in Washington, even the politicians are now saying it would be nice if the politicians would behave like grown-ups.

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KING: So get this. Even the politicians are now complaining that the politicians can't behave like grown-ups. Here's Republican presidential candidate Newt Gingrich in Iowa, talking about our big debate the other night.

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NEWT GINGRICH (R), PRESIDENTIAL CANDIDATE: I literally thought the other night, I felt like I was the recess monitor on the playground, you know, watching these two kids who, you know -- where did that come from, you know?

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KING: And today on Capitol Hill, the new Democratic congresswoman hopeful of New York said her constituents have a constant question when she goes home. Why can't you all just get along? Well, the congresswoman says she's going to start a "Why can't we all get along caucus," and she was smart enough to think of a plan B in case no one shows up.

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REP. KATHY HOCHUL (D), NEW YORK: I'll sit there and have a beer by myself. But that's what's going on in this country. People want us to get along.

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KING: We wouldn't want the congresswoman to drink alone, so she's here with us tonight, along with Democratic pollster Cornell Belcher, who's polling for the Obama campaign. And in New York, Republican strategist, Ed Rollins.

I'm going to get in a moment to this far-fetched idea of yours, that you can get the grown-ups to actually -- to get the Congress people to actually be grown-ups. I want to start, though, because I want to ask all of you. I was just moments ago on TV saying some pretty harsh things about Herman Cain's chief of staff.

And I want to show -- we can show a little bit, a little bit of this video, viral video. Mark Block is the chief of staff. Herman Cain has come from nowhere to skyrocket in the polls. Look at this.

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UNIDENTIFIED FEMALE (singing): I am American.

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KING: I don't begrudge anybody their choices in life, and cigarette smoking is perfectly legal. But for a chief of staff to a presidential candidate to celebrate smoking at the end of a video, I frankly just find it reprehensible. Am I crazy?

HOCHUL: There are standards that I think -- we hit new lows in this election. And I want to tell you, though, we don't have to be here, and American public are fed up with the fighting. And I think it is a low -- I think it's inappropriate.

KING: There's something to the appeal of this candidate and his people. They're different, Cornell. They're generating a lot of buzz. But my position was you can smoke, anybody can smoke. However, if you want to be the president of the United States or a serious aide to the president of the United States, isn't that the wrong message?

CORNELL BELCHER, DEMOCRATIC POLLSTER: Well, John, you're saying that nothing, you know, touches Americans hearts more than a guy they don't know, looking weird, smoking on television doesn't speak to regular Americans? It's horrible, and it does not connect with regular Americans.

And this is the problem with Herman Cain. It makes him not look like the front-runner at all. And when he's trying to be -- this guy is ahead in the polls. He can take this thing by the horns here and make something out of it, but he can't do it if he's putting out crazy stuff like this and it makes him look fringe and out of the mainstream.

KING: Is that right, Ed Rollins? Or are we playing by an old rule book that might not apply?

ED ROLLINS, REPUBLICAN STRATEGIST: No. We're not playing by the old rule book. There's a great interest in Herman Cain at this point in time. The American public doesn't know who he is. It's kind of a circus factor at this point in time.

And when you throw a commercial like that, that has no meaning whatsoever -- it's kind of an ego trip on the part of the campaign manager and really tells you nothing about Herman Cain with any credibility -- you know, it adds to that circus.

Herman Cain has to introduce himself again and again and again and go out and convert people, build an organization, and become a credible candidate. The fact that you lead in polls -- Fred Thompson led in the polls and didn't get a delegate. Rudy Giuliani led in the polls and didn't move forward.

The bottom line here is we want to know about serious challengers to this president, and the campaign -- the next 70 days between now and Iowa is the time that we have to do that.

KING: So let me then come back to where we started, and I was making light of it that I didn't want to leave you to drink alone at your "Why can't we get along?" caucus. But as Ed Rollins just mentioned, there are serious challenges facing the country. And you know, we started the show with a ridiculous conversation about the birther debate. I hope we never have to talk about that again.

Then we had an interesting conversation about taxes and the economy. We should have those every single night.

One of your points about just "Why can't we get along?" caucus, the president's job bill, other issues to come up to the House of Representatives. You're a Democrat, newly elected. You just ran in this environment. And there were a lot of people surprised that a Democrat won that seat up near Buffalo. Why is it? Why is it? The voters sent you here. Why is it when you -- why don't people get along?

HOLCHER: John, I've got to tell you, we see polls that say 12 percent of the American public support us and like us. I want to know who those 12 percent are. That's got to be our family and friends, because after what happened this summer -- I've been on this job five months. We brought this country to the brink of economic disaster because we could not resolve -- we could not find a compromise, something that, if you support the Constitution, our Founding Fathers knew how to compromise. We could have compromised this summer and saved this country from going to the brink.

So I went back and did seven town hall meetings, freshly into the Congress, and talked to our voters. They said, why can't you get along? I said, "Listen, I'll do the best I can. I'll try to develop personal relationships."

I worked for Senator Moynihan a generation ago. We knew how to get the job done. We compromised on health care issues, Social Security. President Reagan worked together with Tip O'Neill And I want to get back to that.

KING: You mentioned that. Ed Rollins, you know the speaker of the House, John Boehner. I've known him a long time. He used to work with Senator Kennedy on education legislation. He's a serious guy when it comes to policy. Why can't -- why can't he get along, and they're in this -- I was going to use non-family-friendly language during this back and forth now on the first piece of the jobs plan. Why can't they pass it?

ROLLINS: I first -- I first came to Washington in 1973, and there weren't very many present members who were there. I think only one senator.

What the congresswoman is suggesting is to have a beer is a positive thing, not because you need the alcohol, but it used to be a place for a lot of social events. You could fight all day long and at night you'd go out. You'd have dinner. You'd sit down. There were no haters. There were fighters, but you weren't haters. And it was plenty partisan. The days of Tip O'Neil and Ronald Reagan. It was plenty partisan, but there was never the hate.

And my sense today is there's a lot of hate and a lot at stake. But we need to basically somehow have some socialized, give up a little bit on both sides. And at the end of the day, do what's in the best interests of the American public.

BELCHER: And you know, I'm going to jump in here, and I'm going to say something that, quite frankly, is going to be unpopular. But to a certain extent, I'm sorry, America, but you the voter, you have to take responsibility in this. Because look, this is one reason why they don't get along.

If you look back over what happened in the primaries, Republican primaries the last time around, how many senators did they take out? How many sitting Republicans did they take out because they were getting -- because they were not, you know, partisan enough?

You've got -- you know, so the American public has to take some responsibility in the people that they're electing, and their actions to -- you know, have consequences. And when you send a group of people to Washington who say that their No. 1 job is to defeat Barack Obama, not move the economy forward. This is the politics you're going to get. So the American people have to take some blame for this.

KING: I view it as 2008 we elect a Democratic president, 2010 we had a Republican House. 2012, in my view, is the tiebreaker.

Ed, Cornell, Congresswoman, I'll bring the beer up to that meeting so you don't have to pay for it.

We'll see you right back here tomorrow night. That's all for us tonight. "ERIN BURNETT OUTFRONT" starts right now. Take it away, Erin.