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Unemployment Rate Drops; Herman Cain to Make Announcement Tomorrow; Interview With Israeli Ambassador to the United States Michael Oren

Aired December 2, 2011 - 18:00   ET


JOHN KING, CNN ANCHOR: Good evening, everyone.

Tonight, the nation's unemployment rate drops to its lowest level in two-and-a-half years, but job growth is still anemic and President Obama heading into his reelection year is open to all the advice he can get. Or is he?


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Oh, he gives me advice all the time.

BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES: I just want to -- I would say, again, this announcement today, the reason you should be encouraged by this, you can run the numbers and see how many jobs he announced.


KING: Always fun to see those guys together.

Tonight, a shocking ad campaign insulting American Jews, get this, paid for by the government of Israel.

But up first tonight, the dramatic reshuffling of the Republican race for president and a rare inside look at the focus groups campaigns use to help with those big strategy decisions. Suppose you're Herman Cain, for example, trying to determine whether your candidacy can survive a series of character questions, or maybe you're Newt Gingrich testing whether your meteoric rise in the polls can sustain tough scrutiny now of your record.




HART: Grandfather. Who else?

UNIDENTIFIED MALE: He's my uncle Joe.

HART: Your uncle Joe. Who else?


UNIDENTIFIED MALE: He would be my favorite uncle. You know, he speaks boldly and positively, but softly at the same time.

HART: OK. Anybody else?


UNIDENTIFIED MALE: Yes, he might be that uncle, but he'd keep bringing in different wives.


UNIDENTIFIED MALE: Plenty to go around.



KING: More from that focus group in just a moment.

But, first, why those impressions of Gingrich and former Massachusetts Governor Mitt Romney matter so much right now. Cain is at home tonight in Georgia to talk face to face with his wife, the biggest deciding factor in whether he will continue his now struggling campaign. Most of his top aides believe he will fight on but some friends from outside of politics say the Cain candidacy is in its final hours.


HERMAN CAIN (R), PRESIDENTIAL CANDIDATE: I am reassessing because of all of this media firestorm stuff. Why? Because my wife and family comes first. I got to take that into consideration.

I don't doubt the support that I have. Just look at the people that are here. We have got to look at what happens to contributions and look at we have got to reevaluate the whole strategy. Tomorrow, in Atlanta, I will be making an announcement. But nobody's going to get me to make that prematurely.


KING: As we await that announcement, you need proof Cain is struggling? How about this? A new Iowa poll from "The Des Moines Register" tonight shows Cain with just 8 percent support one month before the kickoff caucuses. That's way down from 23 percent for Cain just a month ago.

Newt Gingrich is winning some Cain converts as part of his surge in the national and key state polls. More and more Republicans who a few weeks ago predicted a quick Romney victory now see a drawn-out Gingrich/Romney race. What do Republican voters think of that choice? Back now to that rare inside peek at a focus group, this one of Republican voters conducted just last night in Virginia.

Here to help, the veteran pollster Peter Hart, who led the discussion, and our chief political analyst, Gloria Borger, who was on hand to watch it.

I want to look at the fascinating Romney/Gingrich views of your voters last night. But first, Herman Cain has a big decision to make. By this time tomorrow night, we're likely to know it. What -- when you brought up Herman Cain, Peter, to you first, to this group of Republican voters, do they think he can sustain this or do they think he's done?

HART: Done.

KING: Done?

HART: Pure and simple.

When they talked about him, they just had huge problems, both substantively, that he didn't know enough to be president, and the other side was that he really on a moral basis, particularly with harassment charges, were things that bothered people.

KING: None of what we had seen earlier, that he's new, he's different?

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: None of it. None of it. Not even the sort of likability. The words that stuck to me, sitting behind the mirror, was that he has no chance and that he's unelectable about and he was a goner as far as they were concerned. They're over Herman Cain.

KING: We know as we await Mr. Cain's decision, we know Gingrich is surging, we know Romney is struggling, but still has a formidable organization and a lot of money.

These focus groups are fascinating. And it's great to take people inside one tonight. You're a master at this, Peter. You have been doing it for years. You're inside the glass.

One of the devices you use to test people out is you say imagine this candidate as a member of your family, your big extended family. And so to this group of Republican voters, the question was, in your big family, who is Mitt Romney?


HART: Who is Mitt Romney?





UNIDENTIFIED FEMALE: Second removed cousin.


HART: See him as close? Can you relate to him or distant?



HART: Why distant?

UNIDENTIFIED FEMALE: Because he's richer than the rest of us so he wouldn't come to our events.


KING: It's interesting, distant, black sheep, richer than us, so nation like us. When you're trying to build a connect with voters, those are all flashing warning signs, right?

HART: More than flashing warning signs. Essentially, he hasn't made an emotional connection. It's a huge problem for him.

And when we asked, let's suppose he were sixth in line waiting to get on a plane, they said, what would he do? He would buy the airlines or he would buy a ticket, he would do something outside.

BORGER: Payoff.

HART: A payoff of some type. All of this says there's a distance. The other side is they see him as competent, they see him as smart, they see him as a businessman. Those things work for him.


KING: Just one second. One of the reasons we're showing this our viewers tonight is because the campaigns do this, too. Peter does this as part of academic research and for other institutions.

But the campaigns do this. We know the Romney campaign knows just what you just saw. In their focus groups, they would get the same thing. So, Gloria, Ann Romney, in "Parade" magazine, when millions pick up the Sunday newspaper this weekend, David Gergen, our colleague, did an interview with Mitt Romney and Ann Romney is in there.

And she says: "People see him as a business guy, but he has a silly side. He loves to roll on the floor with our grandkids. And he's a prankster."

You didn't get that in that focus group. So it's clear that they know they have a connection problem.

BORGER: No, you're not seeing the warm and fuzzy grandfather type.

Look, I think what I got from the focus group, correct me if I'm wrong, is that in lots of ways he has their respect, but he doesn't have their affection. There's not a warm feeling about Mitt Romney, and there's also a little bit of a sense he could betray them at some point because they do see him as a flip-flopper.

KING: Let's get to that, because first, you would want to have a personal connection with voters. You say he doesn't have it. If you don't have that, you want them to think this is my guy, this is my guy. I might not personally connect with me, but he's going to fight for me on all of my issues.

You brought up, is Mitt Romney -- do you trust Mitt Romney as a Republican?


UNIDENTIFIED FEMALE: Like someone like Newt Gingrich, you know exactly what he thinks and all the time. It's just -- I don't know.

HART: Yes.

UNIDENTIFIED FEMALE: I think it's a personality thing.

UNIDENTIFIED FEMALE: I think that he has strong morals, but he would cave in easily if that's what was necessary to get the public's interest.


HART: He's a what?


HART: What does a RINO mean?

UNIDENTIFIED MALE: He's a Republican in name only.


UNIDENTIFIED MALE: Push came to shove, he would easily side, he would give up a founding principle of the Republican Party just...

HART: How many agree with Ben, he's a RINO?


KING: Again, if you're trying to win a Republican primary, this is an ideological contest to lead the Republican Party. If they think you're Republican in name only, you have got a problem.

HART: You have got a big problem. And the difficulty here is that they see him as ungrounded, somebody who has no political principles, whatever it takes to win.

So they respect him in terms of his intellect, in terms of his character, in terms of his family status, but the difficulty is they don't trust him or like him.

BORGER: Can I just say, the good news for Romney here is that they also feel this way about Newt Gingrich to a certain degree, that they believe that Newt Gingrich has flip-flopped on his positions as well.


KING: Let's go right back into the focus group, because Republicans now have to make this choice. Romney's got a lot of money, he's in the race to stay. Gingrich is surging right now and starting to raise money. Those are two the leading candidate at that moment. Cain is going down. Maybe Rick Perry will get a second or a third act. We don't know.

But if you're looking at Romney/Gingrich, you just heard the concerns about Romney. To Gloria's point, what do you think of Gingrich?


UNIDENTIFIED FEMALE: I think when you enter a race that's this important, you have to know from the get-go what your stand is and stick with it, period.

UNIDENTIFIED FEMALE: That's why I described him earlier as volatile.

HART: OK. Good.

UNIDENTIFIED MALE: I think you need to take a stance. I could see you maybe changing your opinion on maybe one issue, but these are multiple issues and I think that raises a red flag.


KING: You have Republican voters, Peter and Gloria, looking at their two leading candidates at the moment, Mitt Romney and Newt Gingrich, and there's not a lot of trust. They view them both as compromisers, flip-floppers. Help me.

HART: Flawed. Flawed candidates. In other words, each of them have their own separate problems.

Mitt has a passion gap. Newt has all the passion, but over the top, they can't trust him, they're not sure where he's at. Both of them are going to be tested. The public needs to know more. They need to get a better sense.

BORGER: And they're also -- they're really enthusiastic about beating Barack Obama, but what I got from a couple of the people there last night was that there weren't at all sure that anyone in this field of candidates could actually get it done.

And so there's a lot of concern about that and a lot of sort of, well, maybe this wasn't the best field we could have produced.

KING: Help me, lastly, there will be some people watching who say, Peter Hart, he's the dean of the Democratic pollsters, why should I trust him leading a focus group of Republicans? Explain to them why you do this.

HART: Well, it is all aimed at getting underneath.

And I have to explain I do this for the University of Pennsylvania Annenberg Public Policy Center. I'm like an X-ray technician. I'm just going in, finding out what people are thinking. This is what came out. All of it is on C-SPAN, so you can see it all. It's neutral.

BORGER: Always illuminating.

KING: Trust me, folks, if you need an X-ray of this sort, this is the guy you to have want do it, whether you're a Democrat or Republican, an independent or agnostic. He's good at what he does.

A fascinating look inside there. This is a fascinating campaign. You will do that with independents and Democrats later down the road. I hope we can get them in there as well.

HART: Absolutely. We will have you, John.

KING: We will see you right back. Thank you both for coming in.


KING: Still ahead, the Israeli government's ad campaign suggesting American Jews aren't good enough.

And next the unemployment rate is finally heading down. But is it for the right reasons?


KING: It can't, cannot be a bad thing the nation's unemployment rate fell and fell significantly last month from 9 percent down to 8.6 percent.

But the big question tonight is this, just how good is this news? That's more difficult to answer. President Obama, as you might expect, emphasized the positive.


OBAMA: The unemployment rate went down and despite some strong headwinds this year, the American economy has now created in the private sector, jobs for the past 21 months in a row. That's nearly three million new jobs in all and more than half a million over the last four months. So we need to keep that growth going. (END VIDEO CLIP)

KING: But there are signs of trouble, and lots of them in the data as well.

Let's go behind the numbers now with Mark Zandi. He's chief economist for Moody's Analytics. And Chrystia Freeland, global editor at large for Reuters.

Let's look at the numbers.

Mark, to you first, 8.6 unemployment rate, that is down from 9.0, that's good -- 120,000 jobs net, added in November. The unemployment rate at the lowest point since March 2009. That has to make you smile. Yet, officially, more than 13 million Americans still unemployed, 315,000 people flat out just stopped looking for work. And that's the troubling part, right? The rate goes down not because so many jobs are being created, but because hundreds of thousands of Americans gave up.

MARK ZANDI, CHIEF ECONOMIST, MOODY'S ANALYTICS: Well, John, there is good news. We did create jobs and the increase in employment helped to bring down the unemployment rate.

But you're right, one of the key reasons for the large decline in unemployment was that people did give up, the labor force did decline. That's not a positive sign. That's not encouraging. So there's good and bad in the report. Net-net, though I will take it. The unemployment rate is moving in right direction.

KING: Moving in right direction, Chrystia.

One of the conversations we have had for months is are we in danger in falling into a double-dip recession. Most people now think the job growth is not where you want it to be. You would like double at least what we have right now, but is this proof, month after month after month of job growth, that we can set aside at least for now the double-dip talk?

CHRYSTIA FREELAND, GLOBAL EDITOR AT LARGE, REUTERS: Unless something very bad happens in another part of the world, and the part of the world we should be most worried about is Europe.

Yes, I think you're absolutely right, John. I think this should give us some confidence that the recovery, albeit slower than people would like, is really gaining solid footing. But I don't think that the recovery's strong enough that it could sustain a big external shock. And Europe still has the potential to pose that kind of a shock to the U.S. economy.

KING: Important reminder there.

Mark, I asked you this every time, because not only do Americans care about this. One American in particular cares about this, the president of the United States. Where do we think the rate will be a year from now? And let's look. November 2009, it's 9.9 percent, November 2010, 9.8, November 2011, 8.6. What is your prognosis now when we get to late October 2012, when people are about to vote?

ZANDI: I don't think we're going to make a lot of progress, John. I think we're going to create enough jobs to ensure that the unemployment rate remains roughly where it is.

If you told me come this time next year the unemployment rate is somewhere around 8.5 percent, 9 percent, I would say that sounds about right to me.

KING: But let's look at patient, if you will, Chrystia, piece by piece. If you look at retail, 50,000 jobs added last month, some of that probably seasonal, but that's still a good number to see that go up. Health care has consistently been doing well, and it added 17,000 jobs last month. That's a pretty good number. but manufacturing, just 2,000 news jobs. Government shedding another 20,000 jobs. That continues to happen across the country, and the construction industry down, some seasonal impact there, but particularly on the manufacturing front, the made in America front.

That's not a strong enough number, is it?

FREELAND: No, it's not. And I think in terms of what are the unpleasant details a little bit beneath the headline figure, that manufacturing number is one of the ones that really jumps out because at the beginning of the recovery, one of the stories people were starting to tell with some enthusiasm was a bright spot is manufacturing in the U.S. is picking up.

This is a great long-term sign. It means that that is going to be a steady source of good jobs. And also it's a great indicator of a powerful ripple effect across the economy because there's going to be investment in factories and so on. I find that number pretty discouraging.

The other thing that I think is really worth pointing out is the drag that the loss of government jobs is putting on the employment numbers overall. And this really is a pretty perverse situation that we're in. At a time when unemployment remains, I think, at real crisis levels, the government is actually, you know, shooting the economy in the foot by laying people off and adding to the ranks of the unemployed.

KING: It's happening mostly at the state level because they don't have the money to keep people on. One of the questions is, because of that, because of the crisis point, as Chrystia notes, is what to do about it. Here in Washington, one of the big debates is extending a payroll tax cut that was put in place. Both Democrats and Republicans say they want to do it but they're having a fight over how to pay for it.

Listen to how important the president says that payroll tax cut is to stimulating the economy.


OBAMA: Now's not the time to slam the brakes on the recovery. Right now, it's time to step on the gas.


KING: Does he have a point, Mark Zandi? The debate has become not only how to pay for this, the Democrats want to tax on millionaires, Republicans want to find other budget cuts or some other way to pay for it within the budget. But there are some people who were for this payroll tax cut a year or so ago who say they have watched it implemented and they don't see a stimulative effect and they think it doesn't give the economy such a boost, so we can't afford it.

Are they right?

ZANDI: No, I think it's very important to extend the payroll tax holiday for another year.

It's a lot of money to U.S. households. It's about $120 billion. And as Chrystia pointed out, the recovery's still quite fragile, quite weak, and I don't think we can reasonably gracefully digest a tax increase of $120 billion. So I think it's very important to extend it.

I think it needs to be paid for, not paid for in 2012, but in 2013 and beyond. And I think the Democrats and Republicans need to figure out a way to come to some compromise here, pay for this thing and get it done because it's very, very important for the economy, particularly early in 2012, when the economy will be at its most vulnerable.

KING: And, Chrystia, you're nodding your head. Most in Washington think they will figure out something on this one.

But isn't it proof, especially with every day we get closer to the campaign environment, that even on these relatively modest proposals that might help the economy a little bit or at least put a Band-Aid on the economy, the partisan divide makes it more and more difficult for the government to do anything to help?

FREELAND: Yes, absolutely. And I do think that it's pretty surprising that we're seeing such staunch Republican opposition to extending a tax break, right?

It's been so central to the Republican ideology in the latest cycle that taxes are evil. It's a little bit surprising to me to see them effectively, as Mark points out, advocating what would amount to a tax hike. So I think in terms of the politics, the president has the higher ground on this one.

KING: Chrystia Freeland, Mark Zandi, thanks so much.

ZANDI: Thank you.

KING: Smart economics conversation there.

Let's take a closer look now at the politics of the economy. And let's start with the job situation during the Obama presidency. You see the unemployment rate here down to 8.6 percent. The president certainly would welcome that. Let's take a look at it over time.

Remember what happened when the president first took office. We were deep in a recession, and the economy was bleeding, bleeding jobs into the red. Then you had a couple of quarters of big growth and people got encouraged, then back down again. Now we have had growth, some of it not so great, but at least growth on the positive side since then.

Let's put this in historical context. Every president is judged, of course, by the economy when they seek reelection. We will go back here through the George H.W. Bush administration, the Bill Clinton administration, the George W. Bush administration and so far through the Obama administration.

Remember, President George H.W. Bush ran for reelection right in here. Look at the record here, plus 872,000 jobs they had created. Remember he lost his reelection campaign though because of the economy and again the unemployment rate was up just shy of 8 percent. Come into the Clinton years, well, this number is the envy of every president, plus 8.2 million in November 1995. That was a year before his reelection. President Clinton running for reelection with a historically low unemployment rate, down in the 5 percent range, big factor, big factor in his relatively easy reelection campaign.

President Bush, it was not so positive. He was minus net 2.1 million jobs at this point in his presidency, but that was 345,000 up from his low. The Bush administration lost jobs a lot early on, started to come back a little bit. He managed to win reelection despite that.

Let's take a look now where President Obama is a year out. Minus 1.1 million job is the net, if you add up the Obama administration from the beginning to now. But again slight reason for optimism at the White House, that's off the low. That's 2.4 million up off the low. Remember, I showed you the beginning, all those jobs bleeding out. This is not a great number, but it's a lot better than it was just several months ago.

So President Obama carrying this, it's a tough, tough record to carry into reelection, but at least at the White House they can say it's better now than it was not so long ago. We will keep track of that.

Next here, though, the ad campaign sparking so much outrage, Israel's ambassador to the United States had to call home today to complain.


KING: The Israeli government today abruptly canceled an advertising campaign after complaints from American Jewish leaders that it was insulting and offensive.

In a nutshell, a series of ads paid for by the Israeli government suggested American Jews are not good enough partners for Israeli citizens and suggested Israelis living among American Jews are perhaps at risk of losing their religious and cultural identity.

In this commercial, the inability of the American man to read Hebrew is a source of misunderstanding with his Israeli partner.


UNIDENTIFIED MALE: Oh, now I understand why you didn't want to go to the party. Music, candles. Why don't we just stay home tonight? Dafna (ph), what is this?


KING: And here the grandparents in Israel are aghast at their granddaughter's take on the holiday season.




KING: Those television ads and similar billboards in major American cities brought a wave of protests from American Jewish leaders, much of it channeled through our guest, the Israeli Ambassador to the United States Michael Oren.

Mr. Ambassador, thanks for being here.

You picked up the telephone and called your prime minister, all the way to the top, this morning to deal with this. Why?

MICHAEL OREN, ISRAELI AMBASSADOR TO THE UNITED STATES: The minute I was made aware of this, I immediately picked up the phone to Prime Minister Netanyahu.

Now, the prime minister's office knew nothing about the ads. We knew nothing about these ads at the Israeli Embassy. But the minute Prime Minister Netanyahu heard about them -- and he cares very deeply about his relationship with the American Jewish community. He's very aware of these sensibilities. He spent part of his childhood here.

He immediately ordered those ads off the air.

KING: You say the intent was not to offend. You are an Israeli citizen. You are the ambassador from Israel to the United States.

But you were born here in the United States. When you watch the ads, are you offended? Can you understand how American Jews would be offended?

OREN: Indeed. I can look at them and I can see how American Jews might draw the wrong conclusions from them. And, as you know, as you said, I was raised in this country. I have kids living in Israel and I have family members here, and the relationship between American Jewry and Israel are absolutely essential to us, that relationship, that friendship.

And we're committed to strengthening and enriching it. And for that reason, the prime minister acted very swiftly to take these ads down.

KING: And the question is, who's accountable in the sense that you mentioned? It's a small country. Is this a conservative in the prime minister's government who is doing something that perhaps the prime minister and the ambassador to the United States don't agree with? It's a coalition government. You have some partners in government who might have views more to the right, say, than the ambassador to the United States.

Is that what happened here?


I think it's not a matter of right and left. It's a matter of a cultural divide and being insufficiently sensitive to the sensibilities, the hurt buttons, if you will, of a certain community, and because not only myself, but Prime Minister Netanyahu, who spent a lot of his growing up here and his childhood in this country -- he was sensitive to it. He acted immediately to take these ads off the air.

KING: You say didn't intend to offend anyone. I want to read the statement from the Immigration Absorption Ministry, which is the ministry that put up these ads.

"The recent claims, according to which the Israeli government is attempting to intervene in the personal choices of U.S. Jews or to discount their lifestyle, has no connection to reality. The Immigration Absorption Ministry cherishes and values the Jewish community in the United States."

That's the statement. But I want to play again -- just how can you mesh this statement with this?


UNIDENTIFIED MALE: Oh, now I understand why you didn't want to go to the party. Music, candles. Why don't we just stay home tonight? Dafna (ph), what is this?


KING: We can stop there.

You don't view that as an effort by the ministry to intervene in the personal choices of a U.S. Jew, the gentleman there who doesn't understand Hebrew, or to discount their lifestyle? It's clearly an attempt to say he doesn't understand Hebrew. He's not a -- either not a real Jew or not a good enough Jew.

OREN: That's not what it's saying. The Remembrance Day for fallen Israeli soldiers is an intensely personal experience for -- for Israelis. And here, we're hitting up against a cultural divide. Very few Americans appreciate the depth of the sorrow that we experience on that day.

Now, would I have put an ad out like that? I probably would have thought many times before putting out an ad like that and trying to see it through American Jewish eyes.

KING: A big enough controversy that the Israeli ambassador is having a conversation with me, a taped conversation, on Shabbat. And you're back in here in the evening just before sundown to have this conversation. When is this over in the sense of the ads pulled, the billboards down, turn the page?

OREN: Well, the prime minister gave the order immediately upon speaking to him this morning, but there's a seven-hour difference, and Shabbat comes in earlier there than it does here. So I suspect by Sunday, early next week, they'll be off the air.

KING: I have you here, so I'm going to ask you about something else that's come up this week, and that is the interjection of U.S.- Israeli relations into our presidential campaign in the United States.

The president of the United States was at a fundraiser organized by a Jewish leader here in the United States the other night, and he said this: "I try not to pat myself too much on the back. But this administration has done more in terms of the security of the state of Israel than any previous administration. And that's not just our opinion; that's the opinion of the Israeli government."

You speak for the Israeli government. Is that your opinion? Has Barack Obama been better for the security of Israel than any other previous American president?

OREN: President Obama has made immense contributions to Israel's security. Security cooperation with Israel and the United States is an excellent rate today. We've developed anti-missile technology that is absolutely groundbreaking. We stood together in the face of terror in the face of Iranian nuclearization, truly an excellent relationship.

KING: Done more than any previous administration?

OREN: Every administration contributes its own mix, its own contribution to Israeli security, but again, the relationship today is truly outstanding.

KING: You would, I guess, prefer that he not put your government in the middle of all this?

OREN: Well, we have an interest. I'll be very up front with you about this, John. We have an interest in bipartisan support in Israel. In this country, we have an historic bond between the state of Israel and the people of the United States, both Democratics -- Democrats and Republicans. We want to keep it that way.

KING: Mr. Ambassador, I appreciate it. Again, thanks for coming in on Shabbat. Shalom, sir.

OREN: Thank you.

KING: Still ahead here, tonight's "Number" will climb again tomorrow. But will that be the end?

And next, a Washington tradition. A late Friday document, this time involving one of the most controversial programs.


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

Fourteen hundred pages of just-released documents reveal an intense struggle amongst top Justice Department officials when Congress started asking questions about the Operation Fast and Furious program where the government allowed the illegal smuggling of U.S. guns to Mexico's drug gangs.

House Ethics Committee announced today it has found, quote, "probable cause" to suspect misconduct by Illinois Democratic Congressman Jesse Jackson Jr. in connection with fund-raising for then-Governor Rod Blagojevich.

On Monday, the U.S. Postal Service will announce it's slowing down first-class mail delivery. That to save money.

Stocks closed flat today, but it's been the best week since July of 2009, with the Dow and NASDAQ and S&P 500 posting gains of 7 percent or more.

We take a walk to show you tonight's "Number" right now. It will help us frame the conversation just to come. Our "Number," 197. That is, as of tomorrow, how long Herman Cain will be in the Republican race for president: 197 days. When we come back, he has a big decision tomorrow about whether or not he will stay in. How might that division -- decision, excuse me, affect these guys? That's next.


KING: "ERIN BURNETT OUTFRONT" coming up at the top of hour. Erin is here with a preview. And you have a fascinating story tonight about a church that is banning interracial couples. Tell us about it.

ERIN BURNETT, CNN ANCHOR: All right. That's right, John. So this couple, a year ago, they went to a church. Stella Harville and her family lived in this town. She is white. She was marrying a black man. At that time they went to the church. They thought nothing of it. It was her family's church.

And then this summer, when she and her then-fiance said, "Well, we want to get married in that church," her parents went to the church, and the preacher said, "You know I don't want you to sing here any more."

And they said, "Well, why?"

And the preacher said, "Well, because I don't want my 3-year-old granddaughter to see a white woman marrying a black man. I don't want that example."

So we're going to talk to Stella Harville tonight, the woman who was going to get married in the church. There's been some changes in the church. Find out what she's going to do now. And just talk about how this could still happen in this country. So she's going to come out and tell her story for the first time. We're looking forward to that.

KING: Erin, we're looking forward to watching that, as well. That's outrageous. And we'll see you in just a few minutes. Thank you.

We should know by this time tomorrow whether Herman Cain plans to continue his bid for the Republican presidential nomination or drop out because of a Georgia woman's allegations of a long extramarital affair. Cain arrived home late this afternoon to talk face-to-face with his wife Gloria for the first time since the allegation was made four days ago.

He also plans to meet with major supporters and contributors, that tomorrow before a previously scheduled event at his new Georgia campaign headquarters.

Earlier today in South Carolina he said he would have an announcement about the future of his candidacy on Saturday.


HERMAN CAIN (R), PRESIDENTIAL CANDIDATE: That's God's plan. But you see, God doesn't tell you his plan for you until he believes you are ready for those parts of the plan. So I believe that I'm on this journey. I'm on this journey for a reason, and I don't look back. I don't look back.


KING: Should Cain fight on and if he drops what would that mean for the always volatile GOP race? CNN contributors Erick Erickson and Roland Martin are with us tonight, as is Penny Nance. She's the president of the conservative organization, Concerned Women for America.

Let me ask you, first, Penny, if you look at the polling where Herman Cain has suffered the most, it's among Republican women.


KING: Is he a viable candidate still, or should he read that polling and read other signs that say time to go? NANCE: Well, it's not just with women he's in trouble, but certainly that was the first place he started to slip.

Look, Concerned Women for America said from the very beginning, whether it's Bill Clinton, whether it's John Edwards, whether it's Herman Cain, character counts. And so we believe -- and we pushed back very strong against what Lin Wood said, which was that it's all about personal -- what happens in the bedroom stays in the bedroom, and it's all about a person's personal life. We think once you become a candidate, that it's public. We live a public life. And it's worth a discussion.

And conservative women want to know. We want to know what kind of man we're entrusting our country to and also the future of our children, even their lives when it comes to the military. So we think we have a right to know. And it's a great concern.

KING: You mentioned the Lin Wood statement, so I want to read it before I bring Roland and Erick into the conversation. Here's what he said Monday night: "This appears to be an accusation of private, alleged consensual conduct between adults, a subject matter which is not a proper subject of inquiry by the media or the public. No individual, whether a private citizen a candidate for public office or a public official, should be questioned about his or her private sexual life."

Is that -- Roland, can you draw that line once you're a candidate for high office, especially the presidency of the United States?

ROLAND MARTIN, CNN POLITICAL CONTRIBUTOR: I'm sure Senator David Vitter thought that was the case. I'm sure Livingston thought that was the case when he was on (UNINTELLIGIBLE) speaker of the House. And I'm sure Newt Gingrich thought that was the exact same thing when he had all of his issues several years ago.

The reality is, all of these questions are going to come out. What Herman Cain has to understand is that he admitted that he told one of his campaign aides when he ran for U.S. Senate in Georgia several years ago.

So to act like it wasn't going to come up when you're now running for the highest office in the land makes no sense whatsoever. Absolutely, character matters, because the -- the American people want to trust the president. They want to trust that when you send troops into battle that you're making the right call. And if they say that you -- we can't -- if your own wife can't trust you, how can we trust you with the nation's treasury?

KING: Erick, you know Herman Cain, and he is home tonight having a conversation with his wife. He also says he'll talk to some contributors and supporters.

I want our viewers to hear a little bit more of what he said earlier today in South Carolina, and I want your read on whether it is a candidate putting his best face forward or a candidate who really plans to fight on. Let's listen, first. (BEGIN VIDEO CLIP)

CAIN: I am reassessing because of all of this media firestorm stuff. Why? Because my wife and family comes first. I've got to take that into consideration. I don't doubt the support that I have. Just look at the people that are here. We've got to look at what happens to contributions, and we've got to look at what -- we've got to re- evaluate the whole strategy.


KING: What's your gut tell you, Erick?

ERICK ERICKSON, CNN POLITICAL CONTRIBUTOR: You know, my gut tells me that the campaign is over. I think the campaign is over, and the question now is, does he leave now with this implication hanging over him and so people then presume that it was -- that he's guilty of an affair? Forget the harassment allegations, just the affair? Or does he try to save face and know the campaign is over but drag it out a while longer so that he can leave after Iowa and say, you know, "It was because of Iowa, not because of the affair. My wife is with me."

You've never seen Gloria Cain on the campaign trail for Herman. She's never been out there. She's a very private person. When I took Herman's job, a lot of people told me up front that she didn't really want him running for office. She was afraid of what would happen. And now she's being dragged into the media. He's going to have a very hard meeting with his wife. And if you're going to stay in the race you don't announce on a Saturday morning in Atlanta. You go to Iowa.

KING: Well, you mentioned Iowa. I just want to remind viewers. We showed these numbers earlier in the program. He's now at 8 percent in Iowa in the "Des Moines Register" poll. He was at 31 percent a month ago.

So I personally don't think it's just because of the character questions. I think that he couldn't answer a Libya question. He's had some -- he was a candidate of rank and...


NANCE: Stumbled online, stumbled on the air.

KING: It was proof early on that voters are looking for something different. They're hungry for not a traditional politician. And so he had great appeal. But if his decision is to let Iowa make the decision for him, I mean, those polling would tell you it's about to be made. How -- how does it impact Gingrich and Romney?

NANCE: Well, I think there's going to be -- it may not just be those two that are impacted, by the way. There's Michele Bachmann in the race. There's -- there's Rick Santorum in the race that conservatives like. They like both -- we like both of them very much.

KING: When I was in Iowa recently, you could sense some Santorum momentum. The question was, is it enough? NANCE: Well, of course.

KING: Is it momentum to skyrocket him or momentum just to get him to a respectable place?

NANCE: Well, both of those candidates don't necessarily need to finish first; they need to do well. And the question is, how well can they do? And those Cain supporters have to go somewhere. I don't think they'll go to Romney. They will either go to Gingrich or one of the others, in my opinion.

MARTIN: John, all of the last three months I've at here and I've said, look, we can spend all of our time looking at every single poll that comes out, who's doing well in Florida, in South Carolina, and as we all know, none of that stuff matters really until December 1, because we knew when we were five weeks out of the actual voting all of a sudden you saw what was going to happen.

And so, what has happened? Through all of this whole process, where's Governor Rick Perry? Where are the rest of the candidates? And you're seeing all of a sudden Newt Gingrich rises. Romney's still there, and so it's shaking out naturally. This is also why you have to have campaigns. This is why you get in the race and you speak to editorial boards, because this is a weeding out process.

So it's no shock to me the numbers will change. Even you take away the issue of a possible affair, that you will see his numbers drop and you will see serious conditions, to be honest, all of a sudden rise.

KING: And Erick, to the -- Penny says she's not sure Romney would benefit. We know there are questions, especially among evangelical voters, hard-core conservatives. They don't think Romney's one of them.

If they pick up "Parade" magazine with their Sunday paper this weekend, they're going to see this. My colleague, David Gergen, did an interview with Mitt Romney: "Since Mormons are not permitted to smoke, drink alcohol or coffee, or have premarital sex, has it been hard to follow those rules?"

Governor Romney says, "Being faithful to one's spouse is a wonderful source of passion and devotion in marriage and that paying tithes, as suggested by the Book of Mormon, makes one's money less important."

There's a -- clearly an effort by the Romney campaign, which is being careful with whom and how often it does media interviews that when they do do things this is to try, try, try to make a more personal connection, which he has failed so far, right?

ERICKSON: Yes, very much so. They know, and just looking at the start of the show, the focus group, he does not have a personal connection with people. People respect him. They respect what he's done, but they're not sure about him. They're not sure. Remember, conservatives are still very bitter with George W. Bush for TARP and the General Motors bailout and immigration and Harriet Meiers. They feel like he started betraying him in the second term. And now they see a guy who surrounded himself with a lot of Bush supporters in his campaign. They see a guy who was the conservative 2008, the middle-of-the-road guy in 2012. They're not sure what to make of Mitt Romney. They respect him. They just don't trust him.

KING: Erick, Roland, Penny, stand by. When we come back up next, the truth about Rick Perry's efforts to revive his campaign.


KING: First it was Letterman. A late-night stop for Rick Perry after he froze in a debate and couldn't name three federal agencies he would put on the chopping block.


GOV. RICK PERRY (R-TX), PRESIDENTIAL CANDIDATE: I thought the debate was tonight.

DAVID LETTERMAN, HOST, CBS'S "THE LATE SHOW WITH DAVID LETTERMAN": I see. Well, there you go. That happens to everybody.


KING: And then last night, it was Leno, to make light of messing up the voting age while campaigning in New Hampshire.


JAY LENO, HOST, NBC'S "THE TONIGHT SHOW WITH JAY LENO": What happened in New Hampshire here? This is the most recent one.


LENO: Let's take a look here.

PERRY: Those of you that are -- will be 21 by November the 12th, I ask for your support and your vote. Those of you who won't be, just work hard.

You and I, we grew up in that 21 voting age.

LENO: Right, right.

PERRY: I was thinking drinking age maybe.

LENO: Drinking age, drinking age. All right. That makes sense.

PERRY: You got to have -- you got to have an excuse, right? So that's mine, and I'm sticking to it.


KING: So give the governor credit. He has a sense of humor and isn't afraid to poke fun at himself.

But here's tonight's "Truth." The Perry campaign is beyond struggling and with the first votes a month away it is lights out if he stumbles again and needs to pay a visit to Conan or Jimmy Fallon.

Given the troubles of Herman Cain, the historical combustibility of Newt Gingrich, Governor Perry may yet get one more chance. But emphasis on may, and even more emphasis, if it comes, a last chance.

The truth is, American voters proved time and time again they're a pretty forgiving bunch, but there are limits. This is a consequential election, not a late-night TV revival tour.

Penny Nance, Roland Martin, Erick Erickson have their own thoughts on whether Governor Perry is past the point of no return.

And Erick, I want to go to you first, because you wrote on, your blog, the other day, "I think Rick Perry may yet have a second coming if he is ready. I say that having asked many callers to my radio show, who are Cain supporters, where they will go. Most say Newt. The others, Perry. And if Newt implodes, they almost always say they'd go to Perry. Romney is rarely their choice."

Possibly another act. His margin for error is what?

ERICKSON: I mean, this is a campaign that -- think about it. His campaign strategy is based on luck. His campaign strategy is based on Newt Gingrich doing something, not Rick Perry doing something. They need to be making their own luck.

And frankly, John, I'm not yet convinced -- and I don't know that I can be convinced -- that if he does get a second look, his campaign team is going to be ready. One of the best assets he had going into this was his campaign team was homogenous. It had just come through a 2010 campaign. They knew how to set it up. The worst thing his campaign has going for them right now is that they still think that this campaign can be played nationally like it's played in Texas.

KING: As the Texan in the conversation, when you watch Governor Perry, and he has stumbled himself into a tough box, you think what?

MARTIN: Beyond a Texan, I'm also a Texas Aggie graduate, and I'm saying, "Rick, take the Aggie ring off when you're screwing things up like that." Maybe it's the orange tie he's wearing, it's a Longhorn thing.

No, but seriously, it is -- the problem here is this is what happens also when, I believe, you get in the race because so many other folks were pushing you and you got in so late. Remember, we talked about this with Wolf Blitzer. And I said, "Wolf, this is like the NFL draft. You can be great. You can run a 1440 on paper. You can be -- you can go No. 1 in the draft. When you put the pads on, it's a whole different ball game."

He literally -- he is turning into the Reilly and JaMarcus Russell of politics. That is, great on paper but one of the worst busts possible. And this is unbelievable for somebody to have this much experience to be the governor of Texas and then to run this bad of a campaign. He might be last man standing.

Newt is kind of getting a little arrogant with his comments here. I'm going to be the nominee. I'm the smartest guy. So he might still be around. But he has to dominate every debate, every conversation between now and Iowa.

KING: You have a grass roots network. Do you hear a lot of Perry back from them?

NANCE: yes, actually. We -- in Texas alone we have about 22,000 members. Texas is a big state for us. And I can tell you, they love him. They have worked very closely with him. They think he is a great governor, and they think he's been very good for their state. So...

KING: Do they recognize him on the presidential trail? Or they think what happened...

NANCE: They don't, actually. No. I will say, we've had this -- you know, what happened? I had such great expectations. And they said, you know, you're not really seeing the man that we know yet. We hope that he has time to recover. But let me just tell you what you're seeing is not as good as he can do. He can be better. So I actually am very hopeful. I hope that he, you know, gets another chance, takes a breath of fresh air and goes for it.

KING: I remember a lot of people in Massachusetts saying that about Michael Dukakis. That was my first campaign. We're not seeing the governor we know. And at least he got the nomination. Then we saw -- then we saw what happened to him.

Newt Gingrich who was mentioned by Roland a moment ago, he is up in the polls. And when you go up in the polls, you get the "kick me" sign on your back. Ron Paul says, "I can't believe Newt Gingrich is our frontrunner." Listen.


REP. RON PAUL (R-TX), PRESIDENTIAL CANDIDATE: Fannie Mae and Freddie Mac had to be bailed out. We had to pay those debts that were running out. And here he was getting a lot of money from them. And it's not a conservative position. It's a bailout position. So he made money off the bailout.

It's sort of ironic to think that the American people now are seriously considering, you know, that he's supposed to come in and straighten things out. That sort of is bewildering to me.


KING: Now, let's -- everybody gets about 10 or 15 seconds. Erick Erickson, will Ron Paul's attacks get people to give Newt Gingrich a second or third look? ERICKSON: Yes. I think they'll start questioning Newt Gingrich because of Paul's attacks. He may not be able to be the nominee himself, but he can keep Newt in. Who is the great American Sisyphus. He rolls his career up the top of the hill and it comes tumbling back down almost every time.

MARTIN: That Ron Paul ad was devastating and just what I would expect from a Texan.

KING: You say that as a compliment. Newt?

NANCE: Newt stumbled a little today, actually, on the life issue. I hope that he cleans that up. But we have some concerns about things that he said today.

KING: It's a fascinating campaign. We've got one month till Iowa votes. That's from Tuesday -- that's from Tuesday.

Erick, thanks for coming in. Roland and Penny, as well.

Fascinating weekend. We'll see you right back here next week. We're also heading up to Iowa for a whole week. That's the week that begins Monday, December 12. You go to There's a special request. If you live in Iowa or around Iowa, want to contribute to our coverage, take a peek. You'll like it.

That's all for us tonight. You have a great weekend. I'll see you Monday. "ERIN BURNETT OUTFRONT" starts right now.

BURNETT: Thanks, John.