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U.S. Plans to End Afghan Combat Mission; Interview With Rep. Mick Mulvaney; Interview With Chris Van Hollen; "Soul Train" Host Don Cornelius Dies; President Announces Plan to Help American Homeowners Lower Mortgage Rates; Ghetto Film School Online

Aired February 2, 2012 - 08:00   ET



SOLEDAD O'BRIEN, CNN HOST: Good morning. Welcome back, everybody.

Our STARTING POINT is bringing an end to the Afghanistan war. Defense Secretary Leon Panetta says it's time. And some people are saying, not so fast.

Also this morning, time to buy or sale your home, or pay off some debt. The Fed head Ben Bernanke is testifying today on the state of the economy and that could make a big impact on jobs and your money as well.

And the Ghetto Film School, have you heard about this school? I love this program.


O'BRIEN: New professor there, Lee Daniels, film director, is helping kids in the school, many of them focused in the Bronx and around the globe, realize the talent that they didn't necessarily know they had aspiring film makers get to hang out with a famed director to improve their craft. We'll talk to him about why he's doing it straight ahead.

STARTING POINT begins right now.


MARTIN: Got a lot more, a little?

WILL CAIN, CNN CONTRIBUTOR: I want you to understand, this is Black History Month.

O'BRIEN: It is.

CAIN: Anybody know who that is?


MARTIN: Every month is Black History Month.

O'BRIEN: You are an honorary black American. That is true. We tweeted about that.

But, you know, Barry White --

MARTIN: Who named him that?

O'BRIEN: Well, he gave it to himself.

CAIN: The American way.

MARTIN: That won't happen.

O'BRIEN: I went to Barry White's house once and had Chinese food with him and his --

MARTIN: Seriously?

O'BRIEN: Yes, a year or two before he died. Amazing.

MARTIN: Did he sing to you?

O'BRIEN: He did. My girlfriend, Kim, my best friend, sang right back at him.

MARTIN: Knowing Kim, she would do that.

O'BRIEN: It was a little embarrassing, yes. We're moving on now.

Let's talk about the war.

Potential end might be in sight for the U.S.-led combat mission in Afghanistan. Leon Panetta on a plane en route to NATO meeting in Brussels said this, "Our goal is to complete all of that transition in 2013 and then, hopefully, by mid- to the latter part of 2013, we'll be able to make a transition from a combat role to training, advise, and assist role."

Now, that announcement drawing criticism. The chairman of the House Armed Services Committee, Representative Howard Buck McKeon said this: "Announcing a change in mission in Afghanistan before we've even validated that the Afghan security forces can maintain stability in the areas we've already transitioned and ahead of the fighting season is premature."

Well, was it premature?

General Wesley Clark joins our panel this morning, former NATO supreme allied commander.

Thirty-four years of experience, sir, in the military. When you hear what Leon Panetta says and lays out, do you think his critics has a point?

GEN. WESLEY CLARK, FORMER NATO SUPREME ALLIED COMMANDER: Actually, I think Leon Panetta put it pretty well, Soledad. This is a plan we've said we were coming out in 2014. We're going to have to transition before that time in order to a train, advise, assist role. He's just giving fair notice. And I think he said it at a time where's going to Europe. He's going to talk to the European allies. It's about maintaining consensus and strong support for the mission. So, it makes a lot of sense when he said it.

Remember why we went into Afghanistan. We went there because of Osama bin Laden. We got Osama bin Laden.

President Obama made a really tough decision. He got him. He took him down. Al Qaeda's much weaker and much different today.

So, it's time to transition away from this mission.

O'BRIEN: OK. But when you look at what Petraeus and Admiral Mike Mullen said back in the summer, they were -- they didn't support it then. I'm going to play you a little bit of what they said.


GEN. DAVID H. PETRAEUS, FORMER COMMANDER, U.S. FORCES AFGHANISTAN: The ultimate decision was more aggressive formulation, if you will, in terms of the timeline than what we had recommended.

ADM. MIKE MULLEN, FORMER JOINT CHIEFS CHAIRMAN: What I can tell you is the president's decisions are more aggressive and incur more risk than I was originally prepared to accept.


O'BRIEN: They used the word, sir, at the time, more aggressive, more risk. What's changed?

CLARK: Well, I think we finished the fighting season. We've seen the results. We know we're working with the Pakistanis a little bit on this. There may be some discussions going on with the Taliban at some point, we're not sure.

But I think that when you look at the broad stretch American policy, the president has to decide not just on what's going on in Afghanistan, but he has to balance all the other national security and national priorities. So he makes the decision.

Any general is always concerned about increasing the risk, and when I was in NATO when I was running these operations, I felt exactly the same way about withdrawing troops.

But the truth is we've got a pretty good training program over there. We're giving the Afghan government and its military, its security forces the opportunity. We can't do it for them. We're giving them fair notice and adequate time and resources. They've got to pick up the ball and run with it.

MARTIN: That's the point, General Clark. Roland Martin here. By putting a deadline, aren't we basically telling them get your act together. It's time for our troops to come home putting some pressure on them step up? CLARK: I think it can be read that way, and I hope it will be taken that way. It's no secret -- we're not going to be there forever.

So we're not going to be able to stop every assassination attempt that ever might occur in Afghanistan. It's a place that's had a lot of violence and we're trying to train the local people to take care of their own security problems.

So, it was never the intent the United States would stay there and make this the 51st state. I think we have to keep that in mind when we look at the risks associated with the transition.

O'BRIEN: Let me send up a poll, November 18th to 20th, U.S. war in Afghanistan, favor, 35 percent, and oppose, 36 percent. And it would be easy to read this as completely political. The timing really helps the president to be able to say, see, I said I'd hit this deadline and I'm hitting this headline. And maybe more political than making sense policy-wise, I guess is what I'm trying to say.

CLARK: I think it does make sense in the broad stretch. It does give a deadline. It does put some pressure on the other side. It is a smooth transition out for 2014.

And remember, again, the original intent going in there was to go after al Qaeda. The Taliban are a complex problem. They're partly nationalistic, partly apparently supported by Pakistan. Pakistan has its own interests.

We're working very hard to pull together a diplomatic condominium around Afghanistan to help support stabilization. There's a lot going on that you don't see besides just the troops. All of these are factors that can enter the president's decision.

So, there's nothing wrong with him making a decision that makes good sense strategically if it also makes good sense politically.

JOHN FUGELSANG, ACTOR/COMEDIAN: General, they say Afghanistan is the graveyard of empires. I've always felt trying to please the Pentagon was the graveyard of Democrats. Do you think that Secretary Panetta has brought about a new culture where the president's initiatives are being met with more open minds?

CLARK: I think Secretary Panetta is doing a remarkable job, and also Secretary Gates did a great job in the Pentagon. Look, the generals are going to do the best they can to accomplish the mission, but the mission is given by the political leadership of the United States of America. The national command authority is the president and the secretary of defense.

And so, ultimately, they're the ones who have to make the decisions, and I think in this case they're making them. That's as it should be.

O'BRIEN: General Wesley Clark is a former NATO supreme allied commander -- nice to see, you sir, as always.

I've interviewed Wesley Clark for years. It's nice to chat with him. All right. Got other headlines making news. Christine's got those.

Christine, good morning.


We're going to bring you some live pictures right now. The National Prayer Breakfast where President Obama is speaking. That's obviously not President Obama but these are people at the prayer breakfast. It's hosted by members of the House and Senate who meet every week for prayer at the capitol. We're going to bring you highlights of the president's speech later this hour.

All right. Rescue mission off the coast of Papua New Guinea. Nearly 240 people have been pulled from the water after a ferry boat sank. Australian authorities say about 350 people were on board the passenger ship.

Nine radical Islamists admitting in court to a terror plot to strike high profile targets in London, including the U.S. embassy. The men were arrested in raids in December. The attacks said to have been inspired by American-born al Qaeda cleric Anwar al-Awlaki who was killed, of course, in a drone strike in Yemen last year.

Deep cuts at American Airlines. The parent company of American wants to eliminate about 13,000 jobs, 15 percent of its workforce, under bankruptcy reorganization. The company also saying it wants to cut traditional pension plans. The president of the flight attendant's union called these ideas, quote, "unacceptably harsh".

Minding your business. Dow futures, the S&P, the NASDAQ -- all of them slightly lower right now, ahead of the opening bell. Investors are waiting for the weekly jobless claims report due out in just a few minutes.

All right. The bitter truth about sugar. A new study says sugar is basically a poison that should be taxed and regulated like alcohol or cigarettes. Doctors from the University of California-San Francisco says sugar is the main reason behind global rates of killers like heart disease and type 2 diabetes.

And it's Groundhog Day. Just a few minutes ago Phil bombed everybody out.


UNIDENTIFIED MALE: Phil proclaimed, as I look at the crowd on Gobbler's Knob, many shadows do I see. Six more weeks of winter it must be.


ROMANS: And, Soledad, earlier you said you've covered this for --

O'BRIEN: Two hundred and sixty-eight years. Yes.

ROMANS: So is Phil always right? That's what I want to know. Your scientific analysis?

O'BRIEN: No. I don't know. It's 50 degrees in New York today. We are in spring already.

You know what I want you to do, Christine?


O'BRIEN: In our next half hour, what's the financial benefit of doing one of these things? How much money do they make when they bring out --

CAIN: Did you see the crowd?

O'BRIEN: I know. That's what I'm saying. Give me an estimate of how many dollars are raised in this 24-hour period. That's what I want to know.

ROMANS: All right. You got it.

O'BRIEN: Roland Martin wants to know.

All right. Ahead this morning on STARTING POINT.

MARTIN: Break it down.

O'BRIEN: Just a couple hours the Fed Chief Ben Bernanke will testify in front of the U.S. House Budget Committee on the state of the economy. We're going to talk to two members of that committee about their expectations this morning.

Plus, Attorney General Eric Holder in the hot seat. He's going to face tough questions at today's hearing on Fast and Furious. That controversy.

And we're talking to Academy Award-nominated Lee Daniels about his latest project, which is not a movie starring Nicole Kidman, actually he's working on that. But he's also teaching aspiring young filmmakers in the south Bronx their craft.

And today, we are honoring Don Cornelius, the founder of "Soul Train." That was something, 35 years?

FUGELSANG: Thirty-five.

MARTIN: Thirty-five years and he owned the show.

O'BRIEN: Wow, ka-ching.

MARTIN: The first African-American who owned a syndicated show.

O'BRIEN: Ka-ching.

So we are honoring his legacy and his memory with the music from the acts that he made famous from listening to Marvin Gaye.

MARTIN: Tammi Terrell.

O'BRIEN: "Ain't No Mountain High Enough." You're watching STARTING POINT.

MARTIN: Best duo ever.

O'BRIEN: We're back in a moment.


O'BRIEN: Gentlemen, nice to have you join this morning. Appreciate. Sorry, it's not in person, but I know you got stuff to do there on the hill. Let me start with a question about what you would like to hear from the Chairman Bernanke today. Congressman Mulvaney, why don't you start? What do you want to hear from him?

REP. MICK MULVANEY, (R) SOUTH CAROLINA: I think the two things we'll probably talk with him first about are his recently stated -- the intentions of the fed to keep interest rates at or near zero for the next two years. It's an unprecedented move in our history. We want to know why that is, especially if we think we're starting to see some sort of recovery in the markets.

O'BRIEN: Let me stop you for a second, if you don't mind, because you had said previously that that was a teaser rate. So, now, that it's extended two years or three years, I've read as well, what do you think of it?

MULVANEY: Well, that's what we're going to ask the question. One of my concerns was that he was making it not intentionally but one of the unintended consequences of these low rates is that it's very affordable for the government to borrow money. And in fact, you've seen the president go on his nationwide tour saying we should be borrowing more money now not less because interest rates are so low.

So, it struck me that the nation is doing some of the same things that homeowners did a couple of years ago with these teaser rates on mortgages, and I don't want it to see us go down the same road. So, yes, we will be pushing him on that a little bit today.

O'BRIEN: OK. Congressman Van Hollen, what would you like to hear from the chairman?

REP. CHRIS VAN HOLLEN, (D) MARYLAND: Well, I think he's going to make two points. Two points, I think, he should make. The first is that we need to focus on nurturing a very fragile economy.

That means that we've got to extend the payroll tax cut for another ten months. He will also stress, as he has in the past, the importance of maintaining critical investments that have helped the economy grow, investments in education, science and research, and infrastructure.

And then, the other part of testimony will be why it's important to come together now on a plan that will reduce the deficit over a period of time in a stable, predictable way, not in a way that shocks the economy, but in a way that gives us some assurance that we will get the deficit and debt under control in the long run.

I hope we can do that. It should be done in a bipartisan basis and a balanced way. And I think those are the themes the chairman will stress.

O'BRIEN: All right. So, if you look at this chart, which is a graph of the jobless rate over the last 12 months, and you can see some improvement, right? It's heading downward, but there's no one who can read that chart and say, wow, that's amazing. That's terrific. So, what do you think in that kind of long list that you both gave me of the topics you think he's going to cover?

What does he have to say that keeps that tail in there going down? Why don't you start for me, Congressman Mulvaney?

MULVANEY: Sure. We've already asked him that exact question, the joint economic committee, when he testified before us last month. And he said that he didn't think that in the long run, monetary policy could solve the unemployment difficulty. So, what you're seeing is the offshoot of the policies of this administration.

This is the slowest recovery in history. The reason that graph is not more dramatic as it would have been in every other recovery after every other post-war (ph) recession is because of the way we've handled it with this dramatic stimulus project.

So, I think you're going to see him not talk about the fiscal matters that Mr. Van Hollen just mentioned, but the monetary issues are before him, specifically how does he keep growth going and continue to keep inflation under control.

VAN HOLLEN: Actually, Soledad, in the past, Ben Bernanke has essentially debunked what Congressman Mulvaney just said about the president's approach. In fact, Bernanke has said that the actions taken by the Federal Reserve and the actions taken by the recovery bill helped prevent a second great depression and helped stop the free fall.

We are now climbing out of that. Historically, it's always tougher to climb out of recession that's precipitated by a financial meltdown, and we know that. And the good news is, that for the last 22 months, we've seen three million private sector jobs grow. Are we satisfied with the pace?

Of course not, but one of the lessons I think Ben Bernanke is going to talk about is that it would be a mistake to too quickly take any action that would send the economy into a slowdown. And if you cut too quickly in critical investments, you will have that unintended effect. So, yes, we need to come together right now on a long-term deficit reduction plan but, again, don't do anything in the short term that would jeopardize the fragile recovery.

Again, that's why the payroll tax cut's important. People need a little bit more money in their pockets right now, so they can go out and spend on goods and services and businesses, can sell things, and hire more people. O'BRIEN: Congressman Van Hollen and Congressman Mulvaney, thank you for being with us this morning. Appreciate it.

VAN HOLLEN: Thank you.

MULVANEY: Thank you, Soledad.


JOHN FUGELSANG, ACTOR, COMEDIAN: A lot of people have been very outraged about deficits since January 21st, 2009. So, it's interesting to hear this -- see this talk going on, but it is true. When Mitt Romney comes out and says that President Obama lost two million jobs, he's talking about the fact that we were still losing 750,000 jobs per month when President Bush left. That was --

O'BRIEN: But here's the thing. Here is the thing, though --

FUGELSANG: And the stimulus stopped it.

O'BRIEN: I think when your average voter looks at a graph, and it's just down a little.

FUGELSANG: Of course.

O'BRIEN: That's a problem.

FUGELSANG: Absolutely.

ROLAND MARTIN, CNN CONTRIBUTOR: Look, that is going to be a problem --

O'BRIEN: There's a graph. Thank you for running that graph, Danny. I appreciate that.

MARTIN: That's going to be a problem, but also, what we are dealing with is this. The congressman talked about in terms of how the policies have not helped. We're also operating in really a new normal, and that is, you look at the amount of people who have debt, you look at the folks who are living far above their means.

And so, we have this false economy for nearly a generation, and we're now having to pay the price. And we were not going to get out of this in two years. This is going to be a long haul that folks had better get used to.

O'BRIEN: I got to go to commercial break. You have a quick think you want to ad to that or no?

WILL CAIN, CNN CONTRIBUTOR: I agree with that. Private debt has been one of the cancers in the society. It takes a long time to work it off. Ben Bernanke is not getting the credit he deserves for what he's done over the last three years.

O'BRIEN: Looky there. Interesting.



O'BRIEN: That's right. Next up, mo town on his ipPod.

Still ahead this morning on STARTING POINT, there's a face-off over "Fast and Furious." The question is, was there a cover-up in the failed program that ended up putting guns in the hands of Mexican cartels. We're live in Washington for you up next.

And a fire ball in the sky. Look at that. What the heck was that? STARTING POINT is back in just a moment with an explanation.


O'BRIEN: Welcome back to STARTING POINT. In just about an hour, the attorney general, Eric Holder, is going to be grilled on Capitol Hill about the botched "Fast and Furious" gun tracking program. Congressman Darrell Issa has threatened to hold Holder in contempt and has accused the justice department of a cover-up.

Brian Todd is following that story for us this morning. Hey, Brian. Good morning.

BRIAN TODD, CNN CORRESPONDENT: Good morning, Soledad. As you mentioned, this is going to get racheted up in about an hour with about the sixth time Eric Holder's appeared before Darrell Issa's committee on oversight and government reform. This political battle has been really raging for about a year now over the "Fast and Furious" program.

The latest was kind of a salvo of letters just over the past couple of days, one from Darrell Issa to Eric Holder, another from one of Holder's deputies back to Darrell Issa. First, Issa is accusing Holder, essentially, of obstructing his investigation and deceiving the public over the Congressional investigation into "Fast and Furious."

Darrell Issa is demanding a lot of documents be sent to him by February 9th or he says he will hold Eric Holder and the department in contempt of Congress. , the justice department has written back to Darrell Issa saying that's an impossible request. The scope of documents is too great over the past of year to comply with that request.

And they accuse Darrell Issa of, quote, "a significant misunderstanding of the documents that they've already given them in this case." So, there will be more confrontation this morning between Eric Holder and Darrell Issa. It essentially boils down to Issa really wanting to know what the justice department knew about that gun running program into Mexico and when they knew it.

Issa has long contended that Eric Holder and his deputies have withheld information of not giving them the right documents, of not giving them enough documents over the past year so that again will come to a head probably in the next hour or two, Soledad. O'BRIEN: We'll be watching it. Brian Todd for us on Capitol Hill. Thanks, Brian.

Still ahead this morning on STARTING POINT, President Obama has a new housing plan. (INAUDIBLE) work and how does it help homeowners? We'll take a look at that.

Plus, a scary scene in Egypt. These mass riots, and they think it began over a sporting rivalry. We'll update you on the story as well. STARTING POINT continues right after this short break.


UNIDENTIFIED MALE: I was literally sitting in my trailer at the office. And, I was looking at the CNN website. They had the CNN Heroes. I think this was in the first year. And, I saw this story on this guy, Aaron Jackson.

This is a young kid from Florida, grew up on a golf course, didn't really have much direction in his life, and then, he went traveling in the third world, and he saw poverty. And he decided to just devote his life to making the world a better place.

UNIDENTIFIED MALE: Today we've dewormed estimated maybe a little over 100 people.

UNIDENTIFIED MALE: It's been great to be able to help out Aaron Jackson in planting peace by doing some fundraisers and just help his organization really get moving. They have four or five orphanages in Haiti, and I also went out when they distributed the deworming medication out in the rural villages and towns.

UNIDENTIFIED MALE: You're distributing food, aid all around the country. So many kids can be, you know, eating their fill, but because they're so filled with worms, they're unable to digest, process that. That food's, really, just kind of waste.

UNIDENTIFIED MALE: You see a kid that's highly anemic, not alert at all. And once you rid them of worms, they come back to life, and that's what, to me, is most amazing when you see an immediate impact.

UNIDENTIFIED MALE: Since that "Heroes" segment in 2007, we've actually raised enough money with Rain's (ph) help to deworm every child in Haiti, all 3.2 million kids.

UNIDENTIFIED MALE: Anyone can be a hero. It just takes a little bit of work.

UNIDENTIFIED MALE: OK. All right. Ahhhh!


UNIDENTIFIED MALE: CNN "Heroes" inspired me to step up my game and try and do more to help the world.

(COMMERCIAL BREAK) O'BRIEN: We have just rolled in from the club with the SOS Band.

MARTIN: Love that song. Take your time, do it right, baby.


O'BRIEN: This morning we are honoring the late, great Don Cornelius, seriousness for one minute. The late, great Don Cornelius, he passed yesterday. This is an act he put on his show "Soul Ttrain," 35 years of "Soul Train."

MARTIN: Got up in the morning, did your work cleaning the house up so you can watch "soul Train" on time.


O'BRIEN: We have to get to headlines. Christine has those. Good morning, again.

CHRISTINE ROMANS, CNN ANCHOR: Good morning, Soledad. Egypt is in mourning today, a three-day observance underway to remember the 79 people who died in a riot following a soccer match yesterday. Fans rushed the field hitting each other with chairs and rocks. It's still not clear exactly what sparked this violence.

Donald Trump is holding a news conference this afternoon at 12:30 eastern. We're told he'll be making an announcement. According to several published reports the Donald will be endorsing Newt Gingrich.

Washington is going to become the seventh state to legalize same-sex marriage. The state Senate has just passed a gay marriage bill that will easily pass through the house there. The governor says she will sign it.

Planned Parenthood reaping a $400,000 windfall in donations right after the nation's top breast company pulled its funding. The founder of that charity, the Susan G. Komen Foundation, says it's due to a change in policy. It's not pulling its funding because of political pressure.


NANCY G. BRINKER, FOUNDER AND CEO OF SUSAN G. KOMEN: As we move forward we will implement these new strategies which will allow us to serve even more women. We will never bow to political pressure. We will always stand firm in our goal to end breast cancer forever.


ROMANS: And this just in right now, the latest weekly jobless claims, they are down 12,000 to 367,000. Anything below 400,000 is a sign of healing labor market.


ROMANS: Hey, Soledad, Phil will be a little rich. He always sees money.

O'BRIEN: You know, I had a feeling with all of those people gathered around that there was some cash-making proposal involved. How much money?

ROMANS: It's about, well, $1 million for the whole weekend.

O'BRIEN: Just in that one town?

ROMANS: Yes. There's 2,600 rooms in the area. All of them are booked. The way that the travel people in the neighborhood consider it, $30,000, $200 per day per visitor, 30,000 visitors. That comes out to about $1 million.

O'BRIEN: We're doing that here next year. CNN will have their own ground hog. We'll put him on the stage.

ROMANS: He is an economic stimulus in his own.

MARTIN: We're getting a cut?

O'BRIEN: Yes, you will.

MARTIN: I was making sure.

O'BRIEN: President Obama proposing a new program to help homeowners refinance. The idea is to take advantage of the current historically low interest rates. But who exactly will it help? Don Peebles is the chairman and CEO of the People's Corporation, the largest African- American real estate development company. So you are the guy to ask for this. A quarter of Americans with mortgages are underwater. I think that statistic is accurate. How many people do you think the president's proposal potentially could help?

DON PEEBLES, CHAIRMAN AND CEO, THE PEEBLES CORPORATION: About 30 million homeowners could take advantage of this by lowering their monthly mortgage payments significantly or building equity into their homes by taking advantage of the lower interest rates. So basically cutting their payments in many instances as much as to half of their current payment amount and using the rest to start paying down principal, therefore, building or recovering equity into their homes by reducing interest rates.

O'BRIEN: The caveat, of course, is you have to be current on your payments.

PEEBLES: Exactly.

O'BRIEN: Which will rule out a lot of people.

PEEBLES: But 30 million people will benefit from that. Up to this point all of the effort on the housing market in terms of homeownership protection has been towards those who have fallen behind on their mortgage payments, who have been unemployed or had other setbacks. And those mortgages, many of them, we haven't been able to help. But what about all of these Americans who are current who are acting responsibly but are not being able to take advantage of these historically low interest rates because their homes will not appraise out today simply because of the regulations? The lenders still have these mortgages and they are charging interest rates as much as 100 percent more than what they would be today.

O'BRIEN: House speaker Boehner said this. He said sort of we've been here before, seen it, done it. Here's what he said.


REP. JOHN BOEHNER, (R) HOUSE SPEAKER: We've done this at least four times where there's some new government program to help homeowners who have trouble with their mortgages. None of these programs have worked. I don't know why anyone would think that this next idea is going to work. And all they've done is delay the clearing of the market.


O'BRIEN: So before we talk about clearing of the market, there are a couple of programs. There's something called HAMP, the Home Affordable Modification Program, designed to help four million people back in February of 2009. It ended up helping just under one million people. There's something called HARP, the home affordable refinance program introduced in march of 2009 designed to help five million people and it helped, again, just under a million. When he assesses that and says, listen, it's not meeting the need already, why do we need this?

PEEBLES: He wrong, by the way. We can't let everybody go into foreclosure. This is not a foreclosure program.

O'BRIEN: He said clearing of the market, that means foreclosures.

PEEBLES: Yes, exactly. What he's talking about, he's talking about clearing the market. What's happening here is we have 30 million Americans who are upside down in their mortgages who are current and responsible and are not going into foreclosure but it'll take a long time for them to build up equity, enough to be able to get out of their house and move somewhere else. People in the northeast who want to move to Florida or in the Midwest who want to move to Nevada can't go anywhere now because they're upside down in their home mortgages.

But if the interest rates were cut, and so take a homeowner who has a $400,000 mortgage and they save three percent -- reduce their interest rate by 3 percentage points, from seven down to four. They would save $12,000 a year. That $12,000 a year could go towards paying down the principal amount of their mortgage where they're upside down.

CAIN: That could is huge. You're absolutely right. Does it or will it go down to paying that down.

PEEBLES: It's twofold. One, I think it should. The other option, what I think is going to be considered is that money also, that $12,000 a year that the homeowner is paying to pay their mortgage amount and deferring purchases of other goods and services could go back into the economy and infuse additional money into the economy, which, again, is going to stimulate the economy. So it's a win-win. If the Republicans are going to be obstinate on this they will lose ground and America will begin to see that the speaker is not interested in helping America go forward, but he's interested in political gain.

MARTIN: If they're watching this saying, look, here we go helping somebody again. Do you think the average person understands that if you don't confront this problem, if they go into foreclosure, your property values will go down? And you've seen crime go up in those neighborhoods, and it will take us even longer if we don't help folks who are in this crisis right now?

PEEBLES: You're exactly right, Roland.

O'BRIEN: He loves to hear that. Don't tell him that.

MARTIN: Don't hate, congratulate. I'll celebrate.

PEEBLES: He's right. And the fact is everybody benefits from a robust housing market where values are being preserved.

Look, right now you look at the economy that's in somewhat of a recovery. It's in a sluggish recover right now because the housing market is dragging it down. The only way we're going to have a better housing market is increased demand. You have 30 million Americans who can't go anywhere even if they want to.

O'BRIEN: At the end of his comment he said it's not going to work. All it does is delay the clearing of the market. That's a tough phrase for people who are literally trying to figure out to keep their homes.

CAIN: It always hurts when you say it that way. The argument is from a macroeconomic perspective you never know the value of a home because you never put it to true market perspective. I actually agree with Roland that Republicans don't fully realize the depressing effect it would have on the economy.

I would only argue with Don on this is that we have a $17 trillion market backed by a $11 trillion in mortgages. This has been said to cost $5 billion to $10 billion. The point is it's small. It might be the right place to be to muddle along until home values to pick up. But we don't know, will they ever pick up.

PEEBLES: The alternative is, let's take these 30 million Americans who could benefit from that. They're not going into foreclosure. They're not letting their homes go. There's no clearing here. There's just going to keep infusing money into their homes and keep paying their mortgages, so that money is not going back into the economy, nor is it reducing the principle balance. So in order for them to ever be a buyer of a retirement home or to move to where they can find a job, the housing market has to be in full recovery. And by the way, the president shouldn't be trying to knock it out of the park. He should be trying to hit singles. I think that's been part of the problem. This is a single or a double.

O'BRIEN: And that will be our final word on this. Thank you.

Straight ahead on STARTING POINT, it's called the "ghetto film school," and now there's a famous director at the helm. Lee Daniels is going to join us in just a few minutes. Of course he was the director of the movie "Precious." Now he's putting his focus to help kids learn about movies as well.

Also, you don't want to miss our reveal this morning. It has to do with McDonald's and what the fast food chain is serving.

And as we honor Don Cornelius, the late, great Don Cornelius, the founder of Soul Train with music from the acts that he made famous. Let's play a little Lou Rawls.



FUGELSANG: I want to thank you for saving it (INAUDIBLE) because I look like James Brown.

SOLEDAD O'BRIEN, CNN ANCHOR: Kool and the Gang open our next 15 minutes here.

Ok, time for the "Reveal" this morning. McDonald's is announcing that it's no longer going to use something that's called the pink slime in its hamburgers. The pink slime is actually ammonium hydroxide. And it's an ingredient that literally on fertilizers and household cleaners. With the addition of certain acids you could actually turn it into an explosive. I am not kidding.

Anyway the chemical is also --

FUGELSANG: Many bodies do.

O'BRIEN: Mix it with meat scraps and then the USDA when you do that considers that to be a safe meat product. Well, not only McDonald's other fast food chains and food companies use that as well. So they're no longer going to do that at McDonalds.

At least British celebrity chef, Jamie Oliver was one of the first people to bring this pink goo to the public's attention. So now it's done. I didn't know it was a problem. And now that I know I'm glad it's not going to be a problem anymore.

ROLAND MARTIN, CNN CONTRIBUTOR: Way to go Donald Thompson, way to go.

O'BRIEN: Are you enjoying your breakfast?

MARTIN: Yes. O'BRIEN: Anyway straight ahead this morning, Lee Daniels, of course he's the director of the movie, "Precious" he is helping aspiring film makers in their craft as well. The Ghetto Film School. We're going talk to him straight ahead when STARTING POINT continues in just a moment.


O'BRIEN: Well, New York is celebrating the life and work of Don Cornelius this morning.

Our next guest could stay behind the pearly white gates of Hollywood. Instead he is reaching out to young film makers a new program through Ghetto Film School. It uses Google Plus hangout technology to video conference in the top directors and young artists around the world.

Director Lee Daniels joins us. He of course is the director of the critically-acclaimed film, "Precious" and he joins the panel with the Ghetto Film Schools Fellows graduate and Master Class Moderator, Gloria Alvarez. You had a chance to sit next to each other at a dinner not very long ago.


O'BRIEN: It's nice to have you both.

So Lee Daniels, I know for a fact you have a stack of projects that are calling out for you to direct them.

You're working on something with Nicole Kidman right now, right?


O'BRIEN: So you're a busy man. Why would you want to work with -- with young high school age film makers?

DANIELS: Because I came from -- from a place where there wasn't -- there wasn't a mentor or a teacher and I taught myself. And so five years ago I went in and taught and they were so hungry, the faces of these African-American kids. And then all of a sudden it became Sweden, and Portugal, and Haiti.

O'BRIEN: Because it really is now worldwide.

DANIELS: It's just crazy.

O'BRIEN: When look at the -- Gloria, the list for this hangout conversation was Rwanda, Ukraine, Israel, Sweden, Haiti, China, and a kid from L.A., all joining together. That's pretty incredible. As a moderator, what's your -- what's your actual job? What do you do?

ALVAREZ: Well, I have -- my job is to make sure that the conversation keeps flowing and that the kids get their answers answered by Lee.

O'BRIEN: Is it, are they scared? I mean, let me play a little clip. You can imagine, you have your work and this director's there. And he's -- like famous and known for being a little hard core.


O'BRIEN: Ok so -- so yes. Let's play a little bit of -- of some poor child having his work reviewed. Listen.


DANIELS: How old is this guy?

UNIDENTIFIED MALE: Well, in his early 20s -- 22.

DANIELS: Is he, yes? Jacob, is this a story that you're passionate about?

UNIDENTIFIED MALE: Yes, very. But I haven't really prepared it. I have had little time.

DANIELS: That's ok. But -- so -- so keep, so keep tell -- keep going. He's 22. Is he going to die?

UNIDENTIFIED MALE: I will trick the people into thinking that he will by having a first scene.


O'BRIEN: I'm anxious for him. I'm like, oh, God. Answer the question that Lee is putting to you.

FUGELSANG: That's amazing as an NYU Film School graduate, and someone here is sucking up to Lee Daniels, it's great to see this.

O'BRIEN: Carry on.

UNIDENTIFIED MALE: It's not just about film making, you're teaching storytelling to these people in a way that would be impossible in the pre-digital age back when I was in school.

ALVAREZ: And that's -- I think that's the most powerful thing about the whole technology of Google Plus is that now we can take the GFS model that has worked for us here.

O'BRIEN: Ghetto Film School.

ALVAREZ: Yes. Exactly.

O'BRIEN: Now everybody calls it GFS yes, the Ghetto Film School model.

ALVAREZ: The Ghetto Film School model.

O'BRIEN: Hands on really mentoring and teaching??

ALVAREZ: Exactly. And now we can take it to people all over the world. And that to me is just fascinating.

O'BRIEN: So it's eight students that you're dealing with. Is it hard to give mentoring advice sort of from a distance?

DANIELS: Well, you know, I remember when the cell phone was built. I mean, you know so it's hard for me -- it's like walking into cyber whatever. And what is so wonderful is that they still have a common ground and that same common ground is what I came in to start teaching in the Ghetto Films School in the beginning was owning yourself. And owning and being passionate about the work that you're doing and really standing behind it and having a personal story that you can identify with. It's really a commonality with all of them.

O'BRIEN: So it's not just -- you don't just do the pitch, that poor guy because he's crumbling.

DANIELS: He circled back was good.

ALVAREZ: He gave him a second chance and he did amazing.

DANIELS: No, you gave him a second chance.

ALVAREZ: Lee gave them notes, it's like they have to create. They have to make a creative assignment.

O'BRIEN: Right.

ALVAREZ: That's how they get into the class. So their job was to pitch for 30 seconds their story to Lee. And after that pitch Lee gave them notes. And he was the first one off.

O'BRIEN: And they actually have to do a film. It's not like that was a great pitch, next time, good luck. They have to create something?


DANIELS: It's the beautiful thing, that girl from Haiti that they had to light, she didn't have any electricity. So someone, a relative, lit her from a --


ALVAREZ: With a flashlight.

DANIELS: -- flashlight on her face.


DANIELS: And she was anxiously trying to get her story across. It was so beautiful.

O'BRIEN: How will you know if this has been a success? Like at what point do you say oh this thing was a success. Because a new pilot program and the list of directors. Let me read you the list of directors who are involved. Spike Jones, Jim Jarmush (ph); Kathryn Hardwick (ph); John Singleton(ph), Jason Wrightman (ph), Ed Burns (ph). The list goes on and on. Paula Mendoza (ph). So what's success for you?

DANIELS: For me success is -- it was a success last night or --


O'BRIEN: It's done.

DANIELS: -- whenever we did it.


DANIELS: Because those kids walked away and they're going to make short stories. And for you to make a story, for you to hit home with a story that affects anybody, if you have the courage to do it, oh, it's incredible. Really exciting.

O'BRIEN: That's great. Well, it's nice to have you both. Lee Daniels, Gloria Alvarez, thank you for being with us. We appreciate it.


O'BRIEN: Coming up, the "End Point" with our panelists. Stay with us. We're back in a moment.


O'BRIEN: Wait for it. Natalie Cole.

Today we wrap our morning honoring the late, great Don Cornelius. Natalie Cole -- you know who was great to watch on one of these clips?


O'BRIEN: Gladys Knight.

MARTIN: Oh, Gladys.

O'BRIEN: She was on a lot over those 35 years.

MARTIN: Oh, boy. Fabulous, yes.


WILL CAIN, CNN CONTRIBUTOR: Can I ask you a question?

O'BRIEN: Anything.

CAIN: What are you more pleased with? Yesterday nailing Mitt Romney with an answer that he couldn't have planned for or Lee Daniels loving your work?

O'BRIEN: Well, you know what -- that was fun. Lee Daniels did give me some compliments on my documentaries.

You know what; I did not think that --

CAIN: What's more satisfactory? O'BRIEN: I wouldn't say I nailed --

CAIN: It happened on your show. You didn't go after him. I didn't mean it that way. You actually just asked him a question he didn't come up with a good answer to that. I was just curious, which is more satisfactory?

O'BRIEN: You know what I love, I love the fact that you had a young woman who had a little air time who wants to be a filmmaker. They're sitting there talking about mentoring people. And you know, mentoring never gets any air time at all.


O'BRIEN: And here you have a guy who's famous and successful. He gets a little shout out because he's actually taking his craft, which he doesn't have to do; he's in the middle of shooting a movie with Nicole Kidman. And he's sitting around helping a bunch of kids around the globe become filmmakers which they then put online and everybody else can watch this. I think that's cool. If I can give that five minutes.

How's that for you?


CAIN: There you go.

O'BRIEN: No. I don't want to try to get anybody on anything. I just asked the question.

CAIN: I didn't mean it that way. You know that.

O'BRIEN: I know. I know. Can we get back to the show? First of all, hair, straight.

MARTIN: Like it. Like it.


O'BRIEN: I'm kidding. I'm kidding. Ok.

It's time for our "End Point". What do you think? Last 30 seconds. Wrap up the day.

CAIN: Seven billion people on this earth, almost one billion Facebook users. In seven years, one in eight people are on Facebook. Fascinating.


FUGELSANG: My mom's a 77-year-old ex-nun. She's on Facebook.

Newt Gingrich accusing the President of being anti-Catholic; Newt Gingrich who defies the Pope on birth control -- on the death penalty and the Iraq war but it's all over birth control. I would remind anti-birth control Catholics when God said be fruitful and multiply, there were only two people. Mission accomplished.

MARTIN: Always amazing when you get to create your own show, own your own show. Shout out to Don Cornelius. He brought so many people together with one simple show. That's what music and comedy does. It pulls (ph) folks together.

O'BRIEN: We have some music for us to leave our show this morning -- I would agree with that. We've been tweeting all this morning about Don Cornelius. And it's a good way to end because that is a sad end to his story. He was a remarkable man.

FUGELSANG: He made a lot of lame, white guys a lot hipper.

O'BRIEN: Yes, he did.

FUGELSANG: God bless.

O'BRIEN: Yes, he did.

And that is it for this morning's STARTING POINT.


O'BRIEN: We've got to go with Kyra Phillips. She's got a look at the "CNN NEWSROOM".

I'll see you back here tomorrow morning at 7:00 a.m. Eastern right here on CNN.