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JOHN KING, USA

Unemployment Rate Drops Slightly; Cain Campaign Under Fire; Interview With Republican Presidential Candidate Newt Gingrich

Aired November 4, 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.

Tonight, live in Des Moines, Iowa.

Five Republican presidential hopefuls are here in the city tonight, here for a big state Republican dinner that raises the curtain on the 60-day sprint to the first official vote of the 2012 election cycle.

Missing from tonight's event though is the candidate dominating the headlines this week and for all the wrong reasons, Herman Cain. Earlier this evening one of the women who says Cain sexual harassed her in the late 1990s, 1999 in her case, issued a statement through her lawyer saying there was more than one incident.

(BEGIN VIDEO CLIP)

JOEL BENNETT, ATTORNEY FOR CAIN ACCUSER: She made a complaint in good faith about a series of inappropriate behaviors and unwanted advances from the CEO.

She and her husband see no value in revisiting this matter now nor in discussing the matter any further publicly or privately. In fact, it would be extremely painful to do so.

The fact that there are multiple complaints tells me that it's more likely than not that there was some sexual harassment activity by this man at that time.

(END VIDEO CLIP)

BLITZER: The Georgia businessman, he's in Washington, and he said nothing about the allegations that threaten his campaign, but Mr. Cain was in his trademark playful mood as he spoke earlier to a conservative gathering.

(BEGIN VIDEO CLIP)

HERMAN CAIN (R), PRESIDENTIAL CANDIDATE: Before I get started, I want to know, whose teleprompters care these? Because I don't need them.

(CHEERING AND APPLAUSE)

(END VIDEO CLIP) KING: There are several other new developments we need to share with you tonight.

The Cain campaign now threatening to sue the news Web site that first published word of the sexual harassment allegations. And a political committee that supports Mr. Cain, not his campaign, but a political committee that supports it, is on the attack tonight, launching a new TV ad, blaming liberals and the news media for stirring talk of scandal and suggesting race is a factor.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: And they can't argue with Herman Cain on the merits. They can't argue with Herman Cain on policy. So what do they do? What do they do?

UNIDENTIFIED FEMALE: Now we're getting the high-tech lynching of a beautiful man, Herman Cain.

RUSH LIMBAUGH, RADIO TALK SHOW HOST: What is known as the mainstream media goes for the ugliest racial stereotypes they can to attack a black conservative.

(END VIDEO CLIP)

KING: Also tonight, the first national poll conducted since the allegations first surfaced. If you think the lurid headlines and Mr. Cain's fitful response to them are causing political damage, well, think again, at least for now.

The "Washington Post"/ABC News poll shows Cain in a statistical dead heat with former Massachusetts Governor Mitt Romney among the Republican contenders nationally. Not that they're there aren't some warning signs for Cain. Four in 10 Republican voters in that survey say this is a serious matter. And while seven in 10 say it will not influence their decision about whether to vote for Cain, 23 percent say the allegations make it less likely they would back Cain.

And in a crowded Republican field, any doubts can hurt.

Here in Iowa, you hear some questions and sense some doubts in conversations with conservative activists. But nearly a week into the drama, evidence of any major negative fallout is hard to come by. Cain rival Rick Santorum for example could benefit if evangelicals suddenly get doubts about Cain and look elsewhere. But listen to this conversation I had with the former Pennsylvania senator earlier today.

(BEGIN VIDEO CLIP)

RICK SANTORUM (R), PRESIDENTIAL CANDIDATE: I got to tell you, it has not come up in any of meetings that I have had. I just did 20 town hall meetings in the last five days. And most of those days, this was an issue. and I didn't get one question on it, didn't get one comment on it.

So I think people are just sort of keeping their keeping their own counsel, just going to work through it themselves, and continue to focus on trying to make sure that we have the best person who can turn this country around and, of course, defeat Barack Obama.

(END VIDEO CLIP)

KING: I also sat down today with Iowa's veteran Republican governor, Terry Branstad. He had this advice for Mr. Cain.

(BEGIN VIDEO CLIP)

GOV. TERRY BRANSTAD (R), IOWA: I think it's important for him to directly and forthrightly address the issues that have been raised there, and I think Iowans are very fair-minded people. And I think if he does that he can put that behind him. But I do think it's important. I don't think you can just ignore it.

(END VIDEO CLIP)

KING: More on the political fallout in just a moment.

But first let's dig deeper on the new information we have tonight.

CNN's Brian Todd joins us Washington, D.C.

And, Brian, tell us what you know. Joel Bennett, the attorney for one of the accusers, came out today. What more can you tell us about her?

BRIAN TODD, CNN CORRESPONDENT: What we know, John, about his client, the accuser in question here, is that she has been married for 26 years, that this incident happened in 1999 and that she and her husband really just want to be anonymous from this point on. They don't want to discuss this matter publicly or privately.

Those are some of the details that he gave about his client. He didn't really want to go further than that.

Significant points of this, as you alluded to earlier, John, number one, he came out on behalf of his client, Mr. Bennett did, and said that she stands behind the claim that she made against Herman Cain. Second salient point, again as you mentioned, that there was, at least at the point of view of Mr. Bennett and his client, more than one incident involving Herman Cain.

The specific wording of the statement, a series of inappropriate behaviors, plural, and unwanted advances from the CEO. Very significant that Mr. Bennett is saying there was more than one incident. But what we don't have, John, are specifics. We do not know exactly what happened in these alleged incidents. And we're not hearing that from Mr. Bennett, his client or any of the other alleged accusers here, and we're, of course, not hearing that from Mr. Cain's side.

What we did get in a little bit of detail was some response to this from the National Restaurant Association. Part of a statement they issued reads as follows: "In July 1999, Mr. Bennett's client filed a formal internal complaint, in accordance with the Association's existing policies prohibiting discrimination and harassment. Mr. Herman Cain disputed the allegations in the complaint. The Association and Mr. Bennett's client subsequently entered into an agreement to resolve the matter, without any admission of liability. Mr. Cain was not a party to that agreement."

Herman Cain this week strongly disputing these allegations against him, John.

KING: Brian, that is the one client Mr. Bennett represents. I understand you're also learning some new information about a second woman who suggests Mr. Cain behaved inappropriately. What can you tell us?

TODD: That's right.

We spoke to a former employee of the National Restaurant Association who knows the accuser. This employee says that the second accuser, not Mr. Bennett's client, a second accuser, came to this employee's office on the day that this accuser left the National Restaurant Association. The accuser said to this employee that she was not getting along with her bosses, that she was leaving and was receiving a severance, and this employee says that they believe that that severance was between $32,000 and $37,000 because it was a year's pay.

The accuser said, essentially, that they were not giving her any work, they were not interacting with her after this alleged incident. And she left the company after that. So just a little bit of color on what one accuser told a fellow employee as she was leaving the National Restaurant Association, after allegedly filing a complaint.

KING: Brian Todd with new details on this breaking news tonight.

And let's turn now to CNN's chief political analyst Gloria Borger and our senior legal analyst Jeffrey Toobin.

Gloria, I want you to listen here to a little bit more of Mr. Bennett. One of the biggest headlines he put on the table here was that his client says there was not one but more than one incident that made her uncomfortable, made her believe Mr. Cain was sexually harassing her. Let's listen to a little bit from Mr. Bennett.

(BEGIN VIDEO CLIP)

BENNETT: The fact that there are multiple complaints tells me that it's more likely than not that there was some sexual harassment activity by this man at that time.

All of that is subject to proof. He would be allowed to rebut all of them, but I -- but the fact that there's more than one complainant is meaningful.

(END VIDEO CLIP) KING: Dramatic words from Mr. Bennett, Gloria, but he also made clear in the case of his client, one of the women who says this happened, that she is not going to speak. If she's not going to speak, does that lead you to believe we're going to turn the page here and this story will pass, or is there more to come?

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Well, I think she would like us to turn the page. She clearly wants to remain a private individual. As he said before, she doesn't want to become Anita Hill.

But I think there are a lot of people who know who she is and I think at some point, and even he seemed to allude to it today if it happens kind of so be it, because the story remains unresolved. What the National Restaurant Association did not tell us is how they resolved their own internal investigation.

Mr. Cain has come out at the National Press Club earlier this week and he said it was concluded that the charges had no basis. We don't know that from the National Restaurant Association's statement today. They did not talk about any kind of a settlement.

What they did say was the matter was settled without any admission of liability. So there are still lots of questions and lots of charges flying around. I think Mr. Cain would like this to go away. She would like this to go away, but I'm not so sure it will.

KING: Jeff, this is all being argued not in a court of law, and not in front of a mediator, but it's being argued in the court of public opinion. I want to listen to a little bit more of Mr. Bennett here because one of the sources of contention has been from Mr. Cain saying she signed a severance agreement, she terminated her employment, in his view, that agreement had little or nothing to do with sexual harassment. Listen to Mr. Bennett. He begs to differ.

(BEGIN VIDEO CLIP)

BENNETT: A severance agreement is when someone is leaving employment and there's an agreement to pay the person usually a certain number of months of salary for whatever reason. It could be just because the person is leaving.

That's very common in companies that are having economic problems, that have severance policies that are unrelated to any misconduct or performance issues. This was a settlement of an internal complaint of sexual harassment. It was not a severance agreement.

(END VIDEO CLIP)

KING: A clear difference of opinion. Mr. Bennett, Jeffrey, Very much wanted to make that point. Does it matter?

TOOBIN: I don't think any of this matters much at all.

I think today was a very good day for Herman Cain. I think these announcements amount to very little and in a way are unfair to Herman Cain. How is he supposed to defend himself? There are still no specifics. There are still no allegations that he did something specific wrong. And if this is the most that is going to come out, as now is starting to appear likely, I think it's pretty much over.

BORGER: You know, John, what's interesting is that it's clear the Restaurant Association says that it gave this woman the opportunity to waive all confidentiality. And instead, what her attorney said is that they just waived confidential so they could release the statement.

But the statement leaves open all of these questions and I agree with Jeff in the sense that, what's Cain supposed to do now, right? Unless somebody puts a face on this and a specific charge, it's very difficult.

TOOBIN: I think Cain does what he's doing, which is running for president. And he seems to be doing that pretty well.

KING: Well, he also -- his campaign is saying he might sue Politico. I'm not sure there are any grounds to sue Politico, but if you want this to go away, legally, I think that's a big question mark is whether he has a case. Politically, I would think why do you want to keep talking about this?

TOOBIN: Well, I think it's part of their overall theme of blaming the liberal media, the media's out to get me. That's a theme that resonates well in the Republican Party generally today.

And you saw that in the ad that they put out on the Web. I don't think they're actually going to sue Politico. Politico's story has not been challenged for its accuracy. It doesn't tell the full story. They didn't have the full story, but no one says that anything they wrote was inaccurate. I am just, frankly, kind of amazed at how the story is just fading away, if this is as far as it goes.

KING: Jeff Toobin, Gloria Borger, appreciate your insights tonight.

When we return here in Iowa, again, Mr. Cain is not one of the Republican candidates here for a big dinner tonight. What will be the fallout here in Iowa? Is he as some say on this issue and others this cycle's Teflon candidate?

(COMMERCIAL BREAK)

KING: The sexual harassment allegations are a giant test for the candidate and for a candidacy that so far has defied the traditional rules of politics.

Mixed message on abortion, for example, normally quicksand in conservative Republican contests, yet Cain leads among evangelicals here in Iowa and in South Carolina. He's also changed his tune on negotiating with terrorists, suggested an electrified fence along the U.S./Mexican border and made clear he was unaware China has had nuclear weapons for more than four decades. It is a question asked here in Iowa and across the country. Is Herman Cain this cycle's Teflon candidate, so likable and so different that traditional political critiques just don't stick?

Here's Iowa Governor Terry Branstad's take.

(BEGIN VIDEO CLIP)

BRANSTAD: I think that's right. Somebody that's been in politics for years and years and years, they expect him to know all of these things. But he's new. He's a novice. but I think a lot of people are looking for something different. They're not happy with Obama. They're not happy with the direction this country's going and they're not happy with the Congress. So they're looking for somebody new.

(END VIDEO CLIP)

KING: Let's dig deeper now CNN contributor and veteran Democratic start Donna Brazile. Billie Tucker, she's head of the Florida Tea Party Alliance. And with me here in Des Moines, Iowa, the Republican Party chairman, Matt Strawn.

Mr. Chairman , I want to ask you first, after a week of this, is Mr. Cain, who is leading in our latest poll, leading right top of "The Des Moines Register" poll, essentially a dead heat with Romney, is this hurting him? Any you starting to hear any jitters, any concerns, any worries either about the allegations or how he's handled them?

MATT STRAWN, IOWA REPUBLICAN PARTY CHAIRMAN: I think the first thing he does need to do, though is he needs to get here and be in Iowa.

That's one thing about the caucus process, that it gives Iowans or everyday Americans an opportunity to look a candidate in the eye and ask them the tough questions and time has shown that that is how you actually win the Iowa caucuses. Whether it's on a personal issue or whether it's a political issue, there's an expectation that you're going to be here and give an everyday American voter a chance to ask that question.

KING: Billie Tucker, I want to look at -- the first national poll out is out tonight, all of it taken, all of the polling down after this first surfaced. Do the allegations against Mr. Cain make you less likely to vote for him? Among women, 25 percent yes, among men, 12 percent said yes. Essentially seven in 10 say it doesn't matter.

But if 25 percent, and a large chunk of that are women voters, do you see a potential, a potential for a problem in a close Republican race or do you think we're turning the page and this will be behind us soon?

BILLIE TUCKER, TEA PARTY ALLIANCE OF FLORIDA: Well, right now, John, it's just a Ms. Anonymous that is out there. There's really not a story. It's just gossip, that's how we look at it out there in America. Until we have a story and we have a real person come out, we're just going to keep loving on Herman Cain.

KING: And so, Donna, why don't -- let me ask it this way. And I don't necessarily mean the sexual harassment allegations, but why don't traditional rules seem to apply to Herman Cain?

I want you to listen to him earlier today. He's at Americans for Prosperity, it's a conservative group in Washington, it gets some money from the Koch brothers. The Koch brothers are these conservative businessmen and they put a lot of money into conservative causes. Democrats think through evil. Some conservatives think they're great because of what they support, but in politics you don't generally embrace people who are controversial.

Listen to Herman Cain.

(BEGIN VIDEO CLIP)

CAIN: I'm very proud to know the Koch brothers.

(APPLAUSE)

CAIN: They make it sound like that we have had time to go fishing together, hunting together, skiing together, golfing together.

(LAUGHTER)

CAIN: But just so I can clarify this for the media -- this may be a breaking news announcement for the media. I am the Koch brothers' brother from another mother.

(LAUGHTER)

(CHEERING AND APPLAUSE)

CAIN: Yes. I'm their brother from another mother!

(CHEERING AND APPLAUSE)

(END VIDEO CLIP)

KING: How do you explain that, Donna? He's got a sense of humor, you got to give him that.

DONNA BRAZILE, CNN POLITICAL ANALYST: John, if this was a beer primary, Herman Cain would win hands down, but it's a primary for the presidency of the United States.

And I do believe that on a cold wintry night in January, 60 days from tonight, the people of the great state of Iowa will go into living rooms, union halls, church basements and decide who is best to be the commander in chief of the United States of America. And I don't know if Herman Cain will come in first place or come in fifth place, but I do know this.

His brand has been tarnished by these allegations and perhaps the way he's handled the allegations. Perhaps conservatives don't treat sexual harassment as discriminatory, unwelcomed advances in the workplace, but it's wrong. It's morally wrong. It's wrong in the workplace.

So Herman Cain right now, he is doing a great job being Herman Cain. But the question really, to people like Beverly -- I mean, to Billie, is should he become the commander in chief or should he just get a guided tour of the White House?

KING: Well, Billie, answer that question. Are people supporting him because they like him or are they supporting him because they think he's the commander in chief?

TUCKER: They are supporting him because he's been a leader, he's a proven leader, he's a great businessman, he's not a politician.

And what people in America are looking for is somebody that's actually lived the American dream and is somebody fresh and new and that's what Herman Cain brings to the table.

KING: Do you agree with that in the sense that if you look at the tradition of polling here, a lot of time people are ahead 60 days out do not win caucus night. One of the questions people have especially for Mr. Cain is because he's different, because he's not an elected officeholder, and we know people are pretty disgusted with politicians right now, are people -- there's a holding station because they like him or do they really support him firmly?

STRAWN: I think there's a group that supports him firmly.

A perfect example, this week I talked to a 20-year Navy vet, never participated in the caucus process before and he's supporting Herman Cain and he's supporting him because he said -- quote -- "He's not like the other guys, he's a leader."

I think there's new people that he's brought in that probably aren't going anywhere. But some of those traditional activists like the thousand we will have here in Des Moines tonight, those are the people that want to kick the tires a little bit more and there's an expectation that they will see him and get a chance to ask those questions personally.

KING: He's been here a lot less than some of the candidates. You have a commitment for him to come back or you're waiting to hear?

STRAWN: Well, we have got an open invitation any time he wants to come back.

KING: Mr. Chairman, good luck with your event tonight. Billie Tucker, thanks for coming in, Donna as well.

Up next here, tonight's number is a source of frustration for millions of Americans.

And still to come, with so much attention on Herman Cain, maybe you haven't noticed another Republican suddenly in a position to impact the GOP presidential race. The former Speaker of the House Newt Gingrich joins us live.

(COMMERCIAL BREAK)

KING: Tonight's number right out of that old Beatles soundtrack from "The White Album," and the number nine has nothing on this night to do with a tax plan.

You see that right there, the national unemployment rate ticked down to 9 percent in October. That's down from 9.1 percent in September, mostly, though, because Americans are giving up, not because of any big jump in job growth.

The Labor Department reports only 80,000 new jobs were created last month, about half as many as in September. Nearly 14 million Americans are unemployed.

Today, political leaders from both parties called that unacceptable and then went on to say pretty much the same thing.

(BEGIN VIDEO CLIP)

REP. ERIC CANTOR (R-VA), HOUSE MAJORITY LEADER: Unemployment figures in this country are still way too high.

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: Today's job report underscores the need for immediate action.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Unemployment is way to high. Congress is going to need to act.

(END VIDEO CLIP)

KING: This week, the Federal Reserve chairman, Ben Bernanke, warned Congress things won't get dramatically better any time soon. He predicts an unemployment rate in the mid to upper 8s through next year's election.

(BEGIN VIDEO CLIP)

BEN BERNANKE, FEDERAL RESERVE CHAIRMAN: While we still expect that economic activity and labor market conditions will improve gradually over time, the pace of progress is likely to be frustratingly slow.

(END VIDEO CLIP)

KING: Up next: the latest on a late-night political drama in Europe that could have a big impact on your bottom line.

(COMMERCIAL BREAK) * KING: Welcome back. We're live tonight in Des Moines, Iowa. Here's the latest news you need to know right now.

Even though it's past midnight, the parliament is getting ready for a no-confidence vote from Prime Minister George Papandreou of Greece because of his handling of that country's debt crisis.

President Obama is on his way back to the G-20 summit after telling reporters it laid a foundation for building financial stability in Europe.

Jitters about Europe and pessimism about the U.S. economy pushed Wall Street lower today. The Dow, NASDAQ and S&P 500 all lost about 2 percent this week.

This afternoon the White House lawyers rejected a congressional committee's subpoenas for documents related to that clean energy company Solyndra, the White House calling it, quote, "a significant intrusion on executive branch (ph) interests" and is complaining it's being driven by partisan politics.

And a senior U.S. Army general lost his job today for making disparaging comments about Afghanistan's government. Major General Peter Fuller was relieved of duty for saying some Afghan leaders are, quote, "isolated from reality."

Back here in Iowa, Herman Cain isn't the only Georgian making big headway in the Republican presidential race. Look at the national numbers. We'll go state by state, through the early primary and caucus calendar, and there's an unmistakable trend.

Newt Gingrich is moving up, and while still in the second tier, he is changing the race just a few months after most reporters and many of his rivals wrote him off as a non-factor. Speaker Gingrich, live with us tonight before a big Republican dinner here.

It's good to see you.

NEWT GINGRICH (R), PRESIDENTIAL CANDIDATE: It's great to be here.

KING: If you look at the numbers, I want our viewers to see that here's the ABC News/"Washington Post" poll, your choice for Republican presidential nominee. In September, you were at 6 percent. Now you've doubled that to 12 percent.

If you go to the Quinnipiac poll, again another national poll, Newt Gingrich in August, at the end of August, 3 percent. On the first of November, 10 percent, why?

GINGRICH: I think substance. I think the debates have made a huge difference. The one we did with you made a huge difference. And people like Rush began saying I was the adult in the room. And people watched. And some of my colleagues began bickering, and I think the bickering really shrank them.

And I also think people are worried about jobs. They're worried about the deficit. They're worried about Afghanistan. And so having somebody with experience who's actually done this stuff before I think has made a difference.

KING: Our debate in June that you mentioned in New Hampshire was right after a lot of your staff had quit. And I was making the joke with others the other day with you before you came on the air, maybe you had to be the John McCain of this cycle, meaning you had to die before you could live. Is there anything to that?

GINGRICH: I think -- I think it actually was -- ultimately, although it was very painful at the time, ultimately, it helped us a lot to sort out what we were doing, why we're doing it, this is a much better campaign for having gotten through the summer. And I actually feel that we've got a very good base now to be competitive in Iowa, New Hampshire, South Carolina, and then on to Florida.

KING: I want to spend most of our time on the substance, but I want talk a bit about Herman Cain. You call him a friend. You've criticized the media for some of its handling of this story.

And yet, if you pick up the newspaper here, Jennifer Jacobson, even before the Cain story broke, Jennifer Jacobson, the political reporter, "Des Moines Register," she said, "Were something to arise during the campaign to lessen Herman Cain's appeal, Romney would be the biggest beneficiary, but Gingrich is next. He would get 23 percent of Cain defectors." That's from the Des Moines, Iowa, poll.

So on the one hand you could benefit from Mr. Cain struggling. On the other hand, what do you make of his handling of this controversy?

GINGRICH: He is a good friend. We've known each other a long time. I think he has just to slow down, take a deep breath. If you've never before been hit by the entire national press corps, it's a very disorienting experience. And I think that he probably wasn't prepared for it, and he now has got to sit down and sort it out. And we'll see how he does.

He and I are debating tomorrow night in Houston, and it should be a lot of fun, on the entitlements, on Medicare, Medicaid, Social Security. I like him. I think he's had the courage to have very big ideas. But it's also a very hard business. And it should be. This is the presidency of the United States, and you should -- if you can't get through the campaign, you sure can't govern.

KING: His campaign has complained these allegations are out there without the specificity, and then in the middle of that, pointing the finger and saying Governor Perry's campaign did this and can't prove it. Was that a responsible thing to do? Governor Perry says -- he told me last night he has nothing to do with this.

GINGRICH: I'm not going to get in the middle of all that. I'd like to stay focused on policy. I'll let Herman sort out what he's doing now.

KING: Well, let's talk about policy. You tweeted out what Governor Perry wanted to bump plans, as he put it, with Herman Cain on taxes. You said, "How about me, Governor Perry?"

I had a conversation with the governor last night. I want you to listen. Here's him making the case. He says his flat-tax plan is the best plan to create jobs for the country. Let's listen.

(BEGIN VIDEO CLIP)

GOV. RICK PERRY (R-TX), PRESIDENTIAL CANDIDATE: My 20 percent tax, I think, says it all. You give everybody a flat 20 percent tax rate, give them those deductions that we talk about. Those above $500,000, they don't get those deductions. But the 20 percent corporate tax rate, bring that money back in from offshore that's sitting out there, that's being taxed at 35 percent today. Tax it at 5 and a quarter percent. That will create over three and a half million jobs.

(END VIDEO CLIP)

KING: Why is your plan better than his plan?

GINGRICH: Well, let me start and say, as people watch this, you've got 9-9-9 with Cain, which is a big idea. I don't think it works, but it's a big idea. You do have Perry with the flat tax. And the outlier here is Romney, who's very, very cautious and very, very much a managerial approach, as opposed to a bold approach.

First of all, I have -- my flat tax is at 15 percent. His is at 20. My corporate tax rate is at 12.5 percent. His is at, I think, 25. I have zero capital gains for everybody. He caps it at $500,000, which I think gives in to class warfare in a way that makes no sense. But it's not a bad plan. Steve Forbes and other experts have helped him do it. I have a lot of respect for him doing it.

I think if you have to -- if you look at it, you'd say I'm a little bolder and a little more growth-oriented than he is. But deserves a lot of respect. It's a serious plan.

KING: And a serious time, as we have this conversation. You just heard me reading headlines. President Obama's on his way back to the G-20. He says they made significant crisis in the European debt crisis. If a President Gingrich had made that trip, what would your message have been to the Europeans?

GINGRICH: Well, first of all, I have no idea, because the total lack of involvement by the Obama administration is just astonishing. I don't know that they made any progress.

As you just showed, the Greek parliament's voting on a vote of no confidence. Everything I see says that the Greeks are still substantially away from getting their house in order. Whether or not they can even stay in the European Union or stay in the Euro Zone, rather, I think is a question right now.

The Italians are now in deep trouble.

I think this president has consistently failed to understand economics. And I see -- he doesn't understand the American economy. Why would we expect him to understand the European economy?

KING: About 100 hours from now we could be having a conversation about a very tense world. The International Atomic Energy Agency will come out with its latest report on the Iranian nuclear problem. The Israelis test-fired a ballistic missile this week, and there's a lot of talk in the region if that IAEA report says Iran is back about the business of advancing its nuclear program, Prime Minister Netanyahu might be prepared to make a choice, a pretty dicey choice, to launch a preemptive strike. Would a President Gingrich say, "Green light, go"?

GINGRICH: No, I think the Gingrich administration would say we want to replace the Iranian administration. The dictatorship is dangerous; it will always be dangerous. Our interest is to have a post-dictatorship government in Iran. And I would use all of the tools that Reagan, and Thatcher, Pope John Paul II used against the Soviet empire, and I would work methodically to literally undermine and replace the current dictatorship.

KING: If a nervous Prime Minister Netanyahu said, "I agree with everything you just said, President Gingrich. I don't think we can wait." How could you talk him down?

GINGRICH: I wouldn't. I mean, if the prime minister of Israel comes to the conclusion that the survival of his country's at stake, the idea that an American president's going to second guess him -- you know, two nuclear weapons is a second holocaust. You put a nuclear weapon over Jerusalem, a nuclear weapon over Tel Aviv, the total number of people you kill is the equivalent of a Holocaust.

And I don't think any American can ask Israelis to passively sit there and allow a mortal enemy who said publicly, Ahmadinejad said -- frankly, he said publicly that he wants to eliminate Israel. Now I think the lesson of history is people who say things like that you better believe.

KING: You're going to leave us and go speak to the Ronald Reagan dinner here in Iowa tonight. You're one of five candidates at the moment. Again you're, I think, in fourth place. So Romney, Cain, Ron Paul, then Newt Gingrich. Sixty nights from now, when we're counting the first votes that count, where will Newt Gingrich be in Iowa?

GINGRICH: I'll be in the top three, and I hope maybe to come in first. Definitely want to be in the top three.

KING: Mr. Speaker, we'll count the days.

GINGRICH: Good to see you again. Thanks.

KING: And still to come, tonight's "Truth" is a somewhat sad lesson of the Internet age.

And next, more of those new worries at the Pentagon over one of the United States' closest allies attacking one of its most dangerous opponents.

(COMMERCIAL BREAK)

KING: "ERIN BURNETT OUTFRONT" coming up at the top of the hour. Erin joins us now with a preview. How are you? ERIN BURNETT, CNN ANCHOR: All right. I'm doing well, although I see you've got snow there, John. I hope you have some kind of a little heater there.

We're going to be talking about what was, well, distinctly bad weather, although the rainy sort, of course it's the G-20 meeting in Cannes, France, wrapped up. An action plan was agreed to, but will it be enough?

And also, you see those two men there, John, Barack Obama and Nicolas Sarkozy? Well, an incident happened today. The French are very upset about something that the president of the United States said to the president of France. And I think it will shock you. So we are going to get to the bottom of that. We simply cannot resist it.

Plus, with the Merchant of Death getting convicted this week, the Russian arms dealer who had been trafficking in weapons to al Qaeda that kill Americans, we looked into one of the most trafficked weapons in the world. We found a woman who -- the woman who actually is responsible for capturing this arms dealer, and she is our special guest tonight.

So we have all that coming up at the top of the hour. Stay warm, John.

KING: Fascinating. Can't wait to see that. Erin, thanks. We'll see you in just a little bit.

So tonight, new worries at the Pentagon. A senior U.S. military official telling CNN the United States is becoming increasingly concerned Israel might now be preparing to strike Iran's nuclear program.

Let's go to our Pentagon correspondent, Barbara Starr. And Barbara, we hear this talk. Well, what about the feasibility? How likely, how possible? How capable is Israel of launching an effective strike?

BARBARA STARR, CNN CORRESPONDENT: They can launch a very effective strike, John. You know, we hear this talk a lot. It seems to go in cycles. One theory is that the Israelis are ramping up the rhetoric right now because they want to see the United States and the allies react with more diplomacy, more sanctions on Iran.

But I asked a senior military official today, "Are you worried Israel is getting ready to strike?"

And he said, "Absolutely." That is not a word you hear around here at the Pentagon very often.

So what would a strike look like? Well, you know, it's likely that Israel would use a combination of manned aircraft and its ballistic missiles. But it's going to be very tough business. They have to cross Arab airspace. Those aircrafts would have to refuel. They have to get past Iranian air defenses, and it puts Israeli pilots at great risk over Iranian airspace.

Bottom line, the U.S. just does not want to see this happen. It would be an economic, a business disaster. Put the shipping lanes, the oil shipping lanes in the Persian Gulf at risk and really cause great unrest in the region and around the world. Nobody wants to see this happen, John.

KING: And, Barbara, you make that point with emphasis. Nobody wants to see this happen at the Pentagon. Although they have what they call tabletop exercises, contingency plans for just in case.

You made the point about the shipping lanes and the economic turmoil and the military tensions that would come to the region like that if this were to happen. What is the sense inside the Pentagon of what the U.S. responsibility would be the day after?

STARR: Well, you know, you're absolutely right. The U.S. military has, as they say, they got plans for everything. And that would be the problem.

The key issue is, if unrest were to develop in that region, it is likely that it would be the challenge for the U.S. military for the Navy to keep those shipping lanes open. And it would be expected that Iran's reaction would be to try and shut down the Strait of Hormuz.

Interestingly -- don't make too much of it, but it's pretty interesting -- right now the U.S. Navy has two aircraft carriers and about 30 warships directly in the region. That's a bit of a plus up. Usually, they only manage to keep one carrier there. Everybody's saying don't -- don't read too much into it. But it's just pretty interesting to note -- John.

KING: I guess interesting, nice, I'm not sure what the right word is, to have some resources in the region. Barbara Starr, major developing story at the Pentagon tonight. Barbara, thank you so much.

Let's continue this conversation about the diplomatic stakes, the military stakes and the politics of all this with Republican -- Republican strategist Nancy Pfotenhauer. She worked for John McCain's presidential campaign back in 2008. And the former State Department spokesman and National Security Council spokesman P.J. Crowley.

P.J., I want to start with you because of your experience in government. If the administration, the White House and the Pentagon, are so concerned that this could happen and the IAEA report about Iran's nuclear program comes out on Tuesday, take us behind the curtain. What is the secretary of state, what is the national security adviser doing right now to try to convince the Israelis calm down?

P.J. CROWLEY, FORMER STATE DEPARTMENT SPOKESMAN: Well, of course, there's been some conjecture around the -- around the Israelis about whether this is, in fact, a fact or whether this is just something that -- it's a rumor that we have heard before. We've had conversations with the Israeli -- Israelis about this issue. We've shared the broad concern that the trajectory of Iran is very concerning to the United States, to Saudi Arabia, others in the region.

And we've also understood that, while military action is a very important and potential course of action, there are significant downsides to this. Even the targeting, you know, do you retire a nuclear program? But if you hit it but don't end it, you potentially make it inevitable.

There's a curious and shaky relationship between the Iranian regime and the Iranian people. All of a sudden, you make that regime instantly more popular in the eyes of its own people.

You understand, compared to what Newt Gingrich said earlier, even regime change doesn't necessarily change the calculus inside Iran. This is a program that is attached to Iranian nationalism. It's very -- it's very popular with the Iranian people.

So these are all calculations at the strategic level. You have it take into account as you evaluate how to do this, or recognize that military action sometime in the future may well be necessary.

KING: And so, Nancy, as we watch and we watch to see what Israel's decision is, watch to see what the IAEA reports and watch to see how the Obama administration would react.

We are, of course, in this political environment. You just heard the former speaker, Newt Gingrich, saying he would hope this would not happen. But if the Israeli prime minister told him he had to do this, Mr. Gingrich said if he were president, he would say, then, "Go ahead, sir."

I want you to listen here. I sat down with Governor Rick Perry of Texas last night, and he was very concerned about this, as well. Listen to how aggressive he is in giving Israel a green light.

(BEGIN VIDEO CLIP)

PERRY: Obviously, we are going to support Israel. And I've said that we will support Israel in every way that we can, whether it's diplomatic, whether it's economic sanctions, whether it's overt or covert operations, up to and including military action. We cannot afford to allow that mad man in Iran to get his hands on nuclear weapon, period.

KING: Even if started a war in the region?

PERRY: We cannot allow that mad man to get his hands on a nuclear weapon, because we know what he will do with it.

(END VIDEO CLIP) KING: That's Republican candidate Rick Perry, the Texas governor, last night. Nancy, listen here, the former senator from Pennsylvania, Rick Santorum, sounding much the same today.

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RICK SANTORUM (R), PRESIDENTIAL CANDIDATE: If Honduras was developing a nuclear weapon and said things that they want to wipe the United States off the face of the map, would the United States sit and do nothing? I don't know of anybody here in this country that would say, "Well, we should let them continue to develop that weapon with the government that has made pledges that they want to destroy our country."

We would act preemptively, and Israel has the right to do so. And I would support their right to do so. And I think it would be appropriate if -- if Iran was close to getting that capability.

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KING: Nancy, in the middle of a campaign, what goes on in your own debate room? I was going to call it a war room. That's a poor choice of words tonight. When the -- obviously, you're not the incumbent president of the United States. You want to weigh in on issues of the day. That's pretty tough language from both of those Republican candidates.

NANCY PFOTENHAUER, WORKED FOR JOHN MCCAIN'S PRESIDENTIAL CAMPAIGN: Well, it is. But it's also not that different from some statements that President Obama has made. I'll get into what goes on inside a campaign when something like this happens in a minute.

But President Obama has also said that, obviously, if Israel -- if Israel believes that they are facing a definite threat, then they have to make up their own minds about how to protect themselves.

But inside the McCain war -- the McCain campaign -- I won't say war room, I guess -- it was very, very different than I think other candidates and in other Republican presidential campaigns, from my observations. Because, you know, Senator McCain had such a high level of knowledge. He had a very sophisticated and deep foreign affairs advisory staff. He was on his strongest, you know -- in his strongest case, or in his wheelhouse on foreign policy. I don't necessarily see that among any of the candidates, including the president.

I don't think we've seen a president who has felt like -- or where this is his strongest suit either. So whether you're talking about domestic policy and economic policy, or whether you're talking about foreign policy, I think we've been through a very difficult few years.

KING: P.J. Crowley, when you're in the government in the middle of a campaign, does the criticism or suggestions in this case from the opposition help, hurt, or make no difference? CROWLEY: Well, I think this is obviously an issue across the political -- political spectrum. Everyone recognizes the potential danger of Iran. And the difference between now and two years ago is centrifuges have continued to spin. There's clearly, you know -- Iran continues its efforts to, you know, to -- to build this enrichment capability and the -- and the distance between a civilian program which Iran does have a right to, although it's outside of the -- its responsibilities under the IAEA, and a military program, that distance becomes shorter. So as we go through this, this is -- this is a great concern.

So I think it is perfectly appropriate across political lines to recognize the danger that this provides. I think Nancy makes a very good point that, ultimately, the United States and Israel, while they have consistent and overlapping interests, the prime minister of Israel will make his own decision based on the national security needs of his own country. But we will continue to work with Israel as with the rest of the international community.

Everyone, not just Israel, not just America. Saudi Arabia, the region, the world. They recognize this danger, the trajectory, and are working earnestly to try to stop the progress that Iran is making.

PFOTENHAUER: The other thing that -- the other point I think is really relevant here, though, is we -- we have lost a little bit of our bargaining ability. We can't have it both ways. WE can't say we're pulling out of the region and pulling, particularly, our air capabilities out of the region, and then expect to have as much ability to impact outcome. You just can't have it both ways.

CROWLEY: And no one's pulling out of the region. We're pulling troops out of Iraq. We're not...

KING: P.J. Crowley, Nancy Pfotenhauer. I'm going to have to call a time out here. Thank you both for coming in.

PFOTENHAUER: Thank you.

KING: We'll continue the conversation another day. P.J., Nancy, thanks.

When we come back, Iowa is a special place. Retail politics, they say, always matters here. Is that still true? That's tonight's "Truth," next.

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KING: Iowa has a unique role in American politics. And I will admit up front, I'm a big fan. It is the tradition, to the point of being a cliche that, to be successful here, a candidate has to visit time and time again and meet the voters at their farms, small businesses, or in their living rooms.

But here's tonight's "Truth." The path to success here is very different now than it was, say, back in 1976, when Iowa helped launch Jimmy Carter from Jimmy Who to the presidency. Now, Iowa is not immune to the age of the Internet and the 24- hour cable news cycle. And while retail politics still make a difference, you can make your mark here without camping out here.

Tonight is Exhibit A. There's a big state Republican dinner, and there are five candidates for president speaking. But not the two atop the Iowa pack, Herman Cain and Mitt Romney. Talk about an affront to tradition. Two candidates who are almost avoiding Iowa are leading Iowa.

Contrast that with the saga of Rick Santorum. The former Pennsylvania senator is following the traditional Iowa playbook. He just finished visiting the last of the state's 99 counties. His reward? He was at 4 percent in the polls in June, 5 percent now. Still, I spent some time with the senator today. He promises to be this cycle's Iowa surprise.

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SANTORUM: Our 5 percent's solid and building. And we feel like we've got a great grassroots team here. We've spent the time. People have kicked the tires. And we feel a buzz out here. We know that our campaign's going to do much, much better than those polls indicate.

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KING: If there is a big surprise this year -- emphasis on "if" -- conservative activists in this state do say keep an eye on Senator Santorum.

But the current lay of the land suggests the character of the caucuses is changing. Governor Romney, just six days here in 2011. Mr. Cain has been here 36 days in 2011, nowhere near as much as Santorum or Congresswoman Michele Bachmann.

I remember meeting Iowa Governor Terry Branstad in my first presidential campaign, 1988. Fast forward to today, my seventh cycle, and Branstad again is governor and has a message for Romney and Cain.

(BEGIN VIDEO CLIP)

GOV. TERRY BRANSTAD (R), IOWA: They need to be here more if they want to maintain a leadership position. Otherwise, it could be lost very quick. You've seen the polls. They go up and down in a hurry. It's a wide-open race out here. It's going to be decided between now and January 3.

(END VIDEO CLIP)

KING: In the old days, long shots would say money doesn't matter in Iowa, and sometimes they were right. Now it's a lot harder to make that case. Iowa is still the first test and most important test but the character has changed. The "Truth" is, that's inevitable but not, in my view, for the better.

Have a great weekend. We'll see you on Monday night. "ERIN BURNETT OUTFRONT" starts right now.