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Interview with Bishop T.D. Jakes; A Final goodbye To Houston; Push To Raise Dropout Age; Jeremy Lin Continues to Lead Knicks; Mitt Romney Faces Tough Primary Race in Michigan; $26B Mortgage Settlement

Aired February 16, 2012 - 07:59   ET


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

Some new details to tell you about Whitney Houston's final days. There is a source that says she was drinking heavily at the hotel where she was found dead. I'll talk to a man later this morning who produced her final performance. It was supposed to be her come-back film. We'll talk with Bishop T.D. Jakes ahead this morning

Plus, Iran is putting its nuclear know-how on display, but may be over doing it a little bit. Some say the U.S. is also warning of new threats at home over the standoff. We'll talk about that.

And the do-something Congress. A vote coming later this week on a payroll tax deal, a deal that would keep paychecks from shrinking.

STARTING POINT begins right now.


O'BRIEN: You know what I like about Usher? It's the consistent beat so you can run to it. It's actually very good on a treadmill. And he's really cute. OK --



O'BRIEN: Welcome back, everybody. Back to our panel. Penny Lee joins us this morning. She serves as a political advisor to Senate Majority Leader Harry Reid.

Nice to have you.

Will Cain is with us again.

You've been here so much you don't even get a second line any more.


O'BRIEN: It's just like Will Cain -- (CROSSTALK)

WILL CAIN, CNN CONTRIBUTOR: -- drop Cain next, and just Will is here with us.

O'BRIEN: That would be great. That's a great --


CAIN: Like Adele and Madonna, Will.

O'BRIEN: Yes, yes, yes.

And --


O'BRIEN: Matt Taibbi joins us, editor of "Rolling Stone." Nice to have you guys.

Bishop T.D. Jakes is going to join us on a little bit. He's going to talk about "Sparkle," which is the film that Whitney Houston, they're in post-production now. They actually got through all the shooting and then, of course, her untimely death. We'll chat with him about how she seemed during that and what his plans are and, really what her legacy is as well.

Other news making headlines, first, though. Christine Romans has that for us.

Hey, Christine.


Let's talk about that payroll tax cut, the extension clearing a major hurdle. House and Senate negotiators reaching a deal last night, renewing that tax cut for 160 million Americans through the end of this year. It means you're going to keep more money in your paycheck just like last year. It also extends unemployment benefits and it avoids cutting fees for Medicare doctors.

The poison arsenic has been found in some baby formula and cereal bars in the U.S. That's according to a brand new study out of Dartmouth College this morning. They're not naming specific brands but they do say foods that use organic brown rice syrup as a sweetener have six times the federal limit of this toxin. No recall and no ban is in effects just yet.

Police officials in Thailand say Iranian suspects arrested for street bombings in Bangkok this week were actually targeting Israeli diplomats. Thailand's police chief says the devices were similar to bombs targeting Israelis in India and the republic of Georgia this week. Iran denies any involvement in those attacks.

The World Bank is hunting for a new leader. And now, rumors are rampant, will Hillary Clinton be the new World Bank president? Current President Robert Zoellick announced he'll step down in June at the end of his five-year term. U.S. Treasury Secretary Tim Geithner says the Obama administration will put forth a new candidate in the coming weeks, called for an open process to fill that job. Washington has for decades in practice picked the World Bank leader. Clinton repeatedly has denied having interest in a World Bank job.

All right. Minding your business this morning: U.S. stock futures for the Dow, NASDAQ, S&P 500 you know, that one is the best indicator for your stocks, part of your 401(k), all of them down right now. Holdups in negotiations over more bailout money for Greece, from the European Union. That's why.

And also new this morning, General Motors posting a record profit of $7.6 billion last year. That makes 2011 the first year since 2004 that all big three automakers turned a profit just two years after those huge bailouts. That stock though down this morning. Frankly, analysts had thought they would do a little bit better.

The Asian American actress who starred in Michigan Senate candidate Pete Hoekstra's campaign ad now says it was absolutely a mistake. That controversial ad was criticized for playing on cultural stereotypes. Here's the ad.


LISA CHAN, ACTRESS: Thank you, Michigan Senator Debbie Spend- it-Now. Debbie spends so much American money, you borrow more and more from us. You're economy --


ROMANS: The actress Lisa Chan posted an apology on her Facebook page, saying, quote, "I'm deeply sorry for any pain that the character I portrayed brought to my communities. As a recent college grad who has spent time working to improve communities and empower those without a voice, this role is not in any way representative of who I am."


O'BRIEN: Yes. That was another one. You know, there's so many of these little stories now -- thank you, Christine -- in the news.

Like this latest Dana Milbank story which we've been talking about. Can we do this now? Do we have time for this?

All right. She says, sure. Thank you. You're the best. She's in the control room this morning.

You know, you see this Chinese young woman who now is apologizing for portraying the role of a woman in China basically trying to slam Debbie Stabenow's campaign, Hoekstra. Then you have this tweet that came out of the Democrat Jim Messina, how is running. What is he?

PENNY LEE, DEMOCRATIC STRATEGIST: Obama's campaign manager.

O'BRIEN: Campaign manager.

LEE: Campaign manager for Obama.

O'BRIEN: What he tweeted was a quote from "The Washington Post." It's so complicated. I need a chart.

"Washington Post" Dana Milbank has a column about the GOP carrying about Latino voters. His takeaway is not really, they don't. And so, the last line of Dana's column is "The chimichanga, it might be the only thing Republicans have left to offer Latinos."

That's coming out of the line from Senator McCain who says the chimichanga believed to have its origin in the state of Arizona. As he's standing up effectively trying to block the nomination of a Cuban born judge to serve on the court of appeals who is an Obama candidate to be the judge, Alabama, Georgia, Florida would be the 11th Circuit Court of Appeals. That's the background, people.

But the chimichanga -- I know, I know, I need a chart.


CAIN: You need one.

O'BRIEN: So, he tweeted this line which was -- "Line of the day from 'The Washington Post's' Dana Milbank, 'The chimichanga? It might be the only thing Republicans have left to offer Latinos.'" That's a direct quote. That is exactly what Dana Milbank said.

And now, it's like everybody is going crazy. Why?

MIKE TAIBBI, "ROLLING STONE": They need to chill out, you know? They're so sensitive.

O'BRIEN: It's an election year. I'm sorry, did you not realize that?

TAIBBI: Right. I forgot. I forgot. I've been trying not to pay attention here.

LEE: The truth of the matter is what he was trying to do and illustrate.

O'BRIEN: Says our Democratic strategist.

LEE: The irony about it was that McCain was filibustering Hispanic nominee. And Jim Messina was trying to make the point, taking it from a columnist, the irony or lack of sensitivity that Republicans have on Hispanic issues. They vote against the DREAM Act, they're voting against comprehensive immigration. Their front-runner, or depending on the poll, Mitt Romney says we're going to do self- deportation. We're going to be putting grandma back on the boat and getting her out of the country.

So, you know, there is this complete insensitivity that the Republicans have right now. So they are trying to seize on every small moment that they can to illustrate, oh, no, no, no, it's not us. It's the Democrats.

O'BRIEN: Will Cain?

CAIN: Well, I think as we've explored in our relationship, my moral outrage --

O'BRIEN: Whoa. Wow.


O'BRIEN: He didn't say a good relationship. He said our relationship.

CAIN: My moral outrage muscle is completely underdeveloped. But what I'd say is, this is -- this is -- if Republicans are consistently portrayed as racially insensitive, as you just did, Penny, then they are going to respond in irrational ways sometimes. And this is completely irrational.

O'BRIEN: Or is it just an election year and everyone will jump.

CAIN: I agree with Matt. Lighten up. I mean, we are so sensitive about everything. Everybody is. I don't think Republicans should indulge in this kind of moral outrage.

O'BRIEN: But I've got to tell you something, when white people say we're so sensitive, it sends people of color --

CAIN: Of course, I'm a child of privilege, and I don't understand. If you want to say I can't dance --

O'BRIEN: I did not.

CAIN: People that look like Matt and I can't dance, I am not going to be upset about it.

O'BRIEN: That's not what I mean. What I mean is when people say -- oh, ignore this stuff often they're white people. That's true. And I think for people of color, they're like, easy for you to say. I have no idea if you can dance.

Our relationship has not progressed that far yet.

TAIBBI: But it's people that can't have a sense of humor about silly things like this who make "South Park" funny, fringes. We want to make jokes about this stuff because people can't tolerate this kind of silliness.

CAIN: Legitimate things, like the Pete Hoekstra ad is legitimately offensive. When you attack every single slightest indiscretion, then you make things that are legitimate like the Peter Hoekstra watered down.

O'BRIEN: When you call racism racism, no one listens anymore.

TAIBBI: Right, exactly.

O'BRIEN: Interesting. All right.

We have a relationship. Wow.

CAIN: You asked me to marry you one day.

O'BRIEN: No. I said you're my TV husband which is --


CAIN: I didn't hear that.

O'BRIEN: All right. We're turning now.

Let's talk about a serious topic which is really Whitney Houston and her final days. There's a source that's telling CNN that Whitney Houston was seen drinking on the morning that she died, drinking heavily the day before -- days before, Wednesday and Thursday.

And there is this picture, which I think comes from "TMZ" that shows Whitney Houston pool side on Wednesday. There's a drink by her side. Of course, you can't really tell what's in that drink.

The funeral as we've been reporting is going to happen on Saturday. And Anderson Cooper spoke to the Pastor Marvin Winans and he's going to be delivering the eulogy. And he asked the pastor why a private service when so many fans really would love to be able to pay their respects as well.


PASTOR MARVIN WINANS, GOSPEL SINGER: Knowing Cissy and the Houston family, I don't think it was a matter of public or private as it was this is my daughter, this is my sister, this is my mother, this is my friend, and we want to do this with dignity.

I knew that Mama Houston would do it the way she wanted it done, which we're going to church and we're not going to be worried about if the world can get in.


O'BRIEN: Well, the world will be able to get in this summer. They'll be able to see Whitney Houston's final performance in the film "Sparkle." It's in post production, I believe.

Bishop T.D. Jakes produced "Sparkles." He's also going to be speaking at Houston's funeral on Saturday. He's in Dallas this morning.

Nice to see you, Bishop. Thanks for being with us. Am I right? Is the movie now in post-production?

T.D. JAKES, FOUNDER AND SR. PASTOR, POTTER'S HOUSE: Yes, it is in post production. It's pretty much finished.

O'BRIEN: And how is Whitney Houston's performance -- this is a movie I wanted to see even, you know, certainly before all of what happened with her death. People are saying it's really good. It's a great performance. Is that right?

JAKES: Soledad, it was absolutely amazing. I mean, we all agreed, Mary Chase and myself, the entire Sony department agreed that Whitney Houston would be a great choice. But when she walked out there and began to perform, we were all just stunned at how well she did, not only with the singing but also with the acting as well.

O'BRIEN: And she was the executive producer, right? How did it all come to you? The last time we spoke you were doing another movie, "Jumping the Broom." And I was like you're a pastor. When did you become a movie producer?

And you told me at that time if someone brought "Mission Impossible 5" to you, you would be happy to produce that. How did all this come to you and how did she come to you?

JAKES: Well, I've got a vocation (ph). I live in two worlds. I'm interacting with just a few people out there in Hollywood.

We were given a script to read about the remake of "Sparkle." I saw the original "Sparkle" and loved it. I thought it spoke to hope and the resilience of the human spirit in the midst of the decadence of life. So, it's a great story. It's a great script. When Mara got through with it, she took it to another level and we really worked on it together. I just thought this would be amazing if we could pull it off. And we green lighted it.

O'BRIEN: Jordin Sparks is the young woman who's a singer, is also starring in this film. Here's what she had to say about working with Whitney Houston. Listen.


JORDIN SPARKS, SINGER: She got her priorities straight. I heard her talking to her daughter. She's comforting me. You know, she's dealing with all these different things. And it's really cool to see somebody who's got everything, you know, trying to balance and juggle everything as well as wearing the executive producer hat.


O'BRIEN: There are so many peopling who said that Whitney Houston not only executive producing, starring in it, singing as well. I know she was in the recording booth as well, but also just incredibly generous to help her co-stars also have a good experience, too.

Just in ways that often you don't hear about in kind of the behind the scenes chatter about movies.

JAKES: Well, you know, the odd thing about it, there was certainly a synergy between she and Jordin Sparks. When you look at their natural lives and look how Jordin has shot into stardom and Whitney has been there and done that, there was almost a sense of mentoring or camaraderie between the two of them that existed on and off the set.

In the way, I think that the movie really benefited from the oddity of it all is that their characters are in many ways the reflection of their own lives because Whitney played Effie who is a mother who has sung secular music, has gone to the apex of her career and settled down into singing in the church. And Sparkle, who plays her daughter -- I mean, Jordin who plays her daughter is singing in the choir where Whitney started and launching her career. And so, there are some interesting parallels between the script and the lives of the two women.

O'BRIEN: I want to -- before we go to commercial break, I know we'll pick up on the other side of it. I want to play Ethel Waters singing "Eyes of the Sparrow" because it's such a great song. This is what Whitney Houston was recording because this is kind of the main theme from the movie.

So, let's play that first. We'll talk on the other side.


O'BRIEN: We call that an old church song. But also, like lots of old church songs, you have to really have a great voice or everyone will know. There's no faking it in that kind of a song. How was her voice when she recorded that?

JAKES: You know, it was -- that was probably one of the stellar moments in the movie when she began to sing it. We had had some deliberation about that and singing possibly another song that we all knew and liked, "Mary, Don't You Weep." But she said she preferred to sing "Eye on the Sparrow."

I think it was in some way the personal testimony because when she began to sing it, the entire cast and crew were teary-eyed. It was almost as if we were not filming, that we had really gone to church for a few moments. It was a great moment.

O'BRIEN: I believe it. I know you're the producer, but I really want to -- I know you want everybody to go see this movie, but I really want to go see this movie. I'm going to hold you over from the break, if I can, sir. We have to take a commercial break. We'll come back to talk a little bit more about Whitney Houston and also the funeral, some of the details about that.

Also ahead this morning, I'm going to talk about Mitt Romney releasing his taxes now. Now, it's Rick Santorum who's released his taxes. What do we learn when we compare the two of them? One makes less money than the other. Can you guess which one?


CAIN: We'll tell you after the break.

O'BRIEN: We'll tell you after the break. How's that for the tease. Who's got the higher rate? We'll tell you after this.

Also, the debate over raising the high school dropout rate. Some say 16 is really too young. But can you really force kids to stay in school. We've got to take a short break. We'll be back in just a moments with Bishop Jakes.


O'BRIEN: We're doing the fake backup singing on that song. Welcome back, everybody. We're talking about Whitney Houston. She's going to be laid to rest this weekend. Her family will get to say their final goodbyes. The funeral is going to be private, and it's going to happen on Saturday. There will be folks, of course, in attendance, family members, and friends.

Godmother, Aretha Franklin, is going to come and Chaka Khan. The Winans Family will be there. Songwriter, Dianne Warren, as well. And also, Bishop TD Jakes, he's going to be speaking at Houston's funeral. He's back with us.

So, I know you've done this before, obviously, speaking at the funeral of someone who is very beloved, but what do you say? How do you plan for that? How do you sit down and write remarks for, you know, for somebody who everybody felt like they knew and who died at a time that was way, way too early?

JAKES,: You know, I think the major focus is to comfort the family and not to try to provide answers for which there are no answers. People often try to reconcile in their own minds why did this happen, and I think, sometimes, over the years, I've learned that when you really try to over answer and speak on behalf of God, you get yourself in trouble.

But rather than to encourage the family to withstand that this is the truth of lives that come to all people, to use their faith as a catalyst to continue on their journey, to learn life lessons from the gift of Whitney Houston. Both her strengths and weaknesses teach us something about life and cause us to reflect on ourselves. And I think that through that, through the prism of those ideologies, we'll be able to leave some fragments of encouragement.

It really takes time and faith and everything else and family to get through that kind of crisis, but the service does memorialize and point to the fact that something significant has been taken out of this life and away from this world. And I think not only does the family need that but the fans also.

O'BRIEN: Yes, which brings us to the public service. You know, there are so many fans on Twitter. You know, I follow you on Twitter. So, you've seen them, who say, you know, what do you mean, a private service? What do you mean? You know, we loved her, too, and now, we don't get to be part of some kind of an event that memorializes her. How do you explain that to people? JAKES: Well, you know, it's a personal choice. People have to realize that families not only share this moment with them, but they've shared Whitney with the world all of their lives, and often that's very difficult for children, mothers, people who love you because fans crowd in sometimes at the expense of family.

And this is a moment that they get to control and do the way they want to and acknowledge that she was more than a diva and an actress, but she was a mother, that she was a daughter. And as pained as we are, we don't even compare to the reality of the memories that comprise the grief that they have.

It's a personal choice. Some people choose to open it up to commemorate the death of a loved one. Other people do not. I think it's just a decision that each family has to make.

O'BRIEN: You said you're going to focus on the life lessons from both the good times and the difficult times in Whitney Houston's life. So, what are the life lessons? What are the take aways?

JAKES: I think there are many life lessons to learn. She was a very resilient person who, in spite of personal difficulties and tragedies, was resilient and strong willed and able to rise above the fray. I think there are lessons to be learned from that. I think there are lessons to be learned that if we seek the light, we often have to be prepared for the heat that comes with the light for there's a great deal of heat that comes with public exposure as you well know.

And, I think there are lessons about choices, who we marry, where we go, even how we manage life itself and our associations where we can walk away from it and say, you know, am I on the edge? Am I being pushed too far? Am I failing to reconcile the difference between who I am privately and who I am publicly?

And you don't have to be famous to need to do that. Everybody who goes to work in the morning puts a smile on their face and goes forward and does their job often at the expense of personal tragedies and problems that they conceal. It's just that when you're a public figure, you've got really bright light on you.

Everybody has an opinion about every detail of your life. If you change your hair, people will blog and write and say things. Anything you do, they feel that they have a right to interject their opinion into your decision.

O'BRIEN: That's an awful lot of pressure. That's an awful.

JAKES: Absolutely.

O'BRIEN: As you were producing "Sparkle," a lot of people said (ph) this was her comeback. She hadn't done a movie since 1996, "The Preacher's Wife," another movie that I love. Did you get a feel from her like, listen, this has got to work, because there's, you know, it's not just a couple of people rooting for me, the world is watching to see if I'm going to succeed in this, you know, kind of new thing that I'm trying to re-launch?

JAKES: It was beyond it's got to work. It was to the extent that we knew it was going to work. We were just certain that it was going to be the re-launch of her career, and many of the other actors, I mean, there was Mike Epson, others were just incredible in how they did what they did. Jordan Sparks is so believable in "Sparkle." It was scary.

And it was just that magic that comes together sometimes on film that is a great team of people, Sakim Akil, tremendous director (INAUDIBLE). All of that together was just the perfect storm. And we thought we would see a great re-launch of her career. We did not know that we would be left with the -- I think it's a responsibility to hold in our hands her last cinematic production.

O'BRIEN: Is that pressure?

JAKES: There is a sense of responsibility.

O'BRIEN: That sounds like when you put it that way, that sounds like a lot of pressure.

JAKES: It is because, I mean, who would have ever thought, I certainly did not. We finished in November. We walked away going to post production and you go into that stage of marketing and all of that sort of thing. And all of a sudden, you're holding an archive in your hand, a piece of American history that affects the whole world.

We didn't think when we started that it would end that way, but it has, in fact, ended that way. And I'm just proud and honored that it is such a tremendous, tremendous show. I think it will highlight Whitney. I think it will highlight what many actors go through and artists go through behind the scenes, not only Whitney but around the world, and I think it will cause people to reflect with solemnest on who Whitney Houston was.

O'BRIEN: Bishop T.D. Jakes, nice to talk to you, sir. Thanks for being with us this morning. We appreciate it. I'm looking forward to that movie coming out. Everybody is going to want to see that.

Still ahead this morning on STARTING POINT, raise the dropout age? President Obama is calling for kids to stay in school. Is it realistic?

Also, the HUD secretary is going to talk with us this morning about the mortgage settlement with banks. Does it fall a, say, trillion dollars short?


O'BRIEN: Will Cain says yes.

And we're also going to talk about whether or not you can even cash in on it. You're watching STARTING POINT. We're back right after this.


O'BRIEN: It's just not Thursday if we don't have a little notorious B.I.G. to start our day. That's Steve Perry's tunes. We're back to chat with Steve Perry. The question this morning is how old is old enough to drop out of school?

Many people in 19 states, in fact, you only have to be 16 years old to drop out of school. Those are the states highlighted there in yellow. President Obama talked about changing that when he delivered his "State of the Union" address. Here's what he said.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: When students are not allowed to drop out, they do better. So, tonight, I am proposing that every state, every state requires that all students stay in high school until they graduate or turn 18.


O'BRIEN: So, the debate's picked up some steam again this week. An editorial in "USA Today", I think it was, backs what the president calls for. Some people say, though, it is not really far enough. Steve Perry is the CNN education contributor. He's the founder of Capital Prep Magnet School.

We did a documentary, "Black in America 2" was done on his school. Nice to see you. Good morning to you. OK. So, if you change the dropout age as the president's suggesting to 18 or just never, you're not allowed to drop out, do you think that would make a real difference?

STEVE PERRY, CNN EDUCATION CONTRIBUTOR: I don't know that it will make a lot of difference. You can't force a kid to stay in school. I mean, we have a kid right now who's a senior who's doing all he can to drop out. We're sending people to his house. Sometimes, some kids will drop out.

However, you can create conditions in which graduation rates will improve. Look at New Hampshire, for instance. They have an amazing program in which they create a flex school day for some children. They allow some children to take gym, for instance, at their local YMCA or gym.

They create other opportunities for the students to finish, and as a result, Governor Lynch has created a program in which they claim to have a 1.6 dropout -- I mean, yes, 1.16 percent dropout rate.

O'BRIEN: Which would be really, really low. The "USA Today" story that I was talking about cites a study from the Gates Foundation that says half of the dropouts leave because they're bored with classes or they feel like what they're doing that moment in the classroom has no actual correlation to what they're going to do in their lives. And they suggest expand vocational programs, give them something that would help them sort of see a connection to what they're doing and an actual job. Do you think that could work?

PERRY: Well, one of the reasons why people often go to the vocational conversation is because they think that these children don't want to go to school because they want to work in a trade. That's not typically the case. In many cases too often children are deciding upon a trade because they don't feel like they fit in a college preparatory academic experience. That has more to do in the way in which schools have prepared them up to that point as opposed to their love for a vocation.

I think what we need to do is do a better job of creating academic experiences which compel children earlier on because that's where the problem lies. One of the reasons why you have schools in which you have a 40, 50, 60, 70 percent dropout rate, the children feel like they're anonymous. Another reason why children drop out is because they feel like they're being put upon, bullied, made to feel like they don't fit into school. Fit is a very important part of continuing your academic experience.

So when children feel like someone cares about them by creating more, smaller, compelling academic experiences, you have a much smaller graduation rate. That's one of the reasons why I look at New Hampshire as a model. New Hampshire in fact has a reverse achievement gap. If you look at the Schott report, it says that 83 percent of African-American males graduate while 78 percent of white males graduate.

O'BRIEN: A lot to be learned from the state of New Hampshire which has a very small African-American population. Steve Perry, thank you. I've done stories on schools that have a 75 percent and 79 percent dropout rate. The graduation picture was all empty seats and then four rows of students.

PENNY LEE, POLITICAL CONSULTANT AT VENN STRATEGIES, LLC: You have to ask the question as to why. Is it teacher inadequacy? Is it too large of classrooms? Is it societal? What is it that's making these kids not --

CAIN: Parents.

LEE: Parents. We do need to have a conversation because our education system is failing.

O'BRIEN: A large percentage are Latinos, far greater percentage than African-Americans and white students.

Still ahead this morning on STARTING POINT, a $26 billion settlement comes from big banks as an attempt to repair trillions of dollars in damage to the U.S. housing market. We will' have an exclusive conversation with the HUD secretary whether this will work or fall short.

Plus North Korea saying happy birthday to its fallen dear leader. A show that's so massive it's almost hard to see. We'll explain straight ahead. You're watching STARTING POINT is what I'm trying to say. We've got a commercial break. We'll be right back.


O'BRIEN: For a Democratic strategist, you have an excellent play list.

LEE: Thank you very much. Little bit of an eclectic mix.

O'BRIEN: No, you win. Really.

LEE: What's my prize?

O'BRIEN: We overlap.

CAIN: She's blushing a little bit. I am continually surprised by how personally both positively people take comments on their musical choices.

O'BRIEN: He did not submit his play list so next time, next time.

UNIDENTIFIED MALE: I'm a musical illiterate. It would have been embarrassing.

O'BRIEN: Never. I have a terrible play list. That's all right. We like to make fun of people.

Let's get to the headlines this morning. Christine has those for us. Good morning.

CHRISTINE ROMANS, CNN ANCHOR: Good morning. I have good news for you. Just in to CNN, the Labor Department announcing 348,000 jobless claims were filed for the first time last week. That is the lowest level in almost four years. Any time this number comes in less than 400,000 it's a sign that the labor market is heading in the right direction. We have a trend now in place where these jobless claims have been averaging down here in the 350 range. Good sign. This basically means it's the best labor market in the very short term that we've seen in about four years.

Also just in to CNN a new picture out of Syria showing thick, black smoke billowing from that sabotaged pipeline in the city of Homs. Activists accuse government forces of bombing the pipeline yesterday. Meantime, the violent and deadly crackdown in Syria, dozens more have been killed in fighting today.

The U.S. in the middle of secret talks with the Taliban and Afghanistan officials in Kabul. Afghan President Hamid Karzai say talks could lead to a full-fledge peace negotiation. But U.S. officials say discussions are only preliminary, and the Taliban has said it would not negotiate Karzai.

GOP presidential candidate Rick Santorum releases his tax returns for the past four years. That's since he's been out of the Senate and in the private sector. They show yearly earnings at more than $900,000 last year, $3.6 million over the four years. He paid $260,000 a year in taxes. The highest tax rate was 23.8 percent for last year, that tax rate twice Mitt Romney's.

Another candidate hoping to join congress, Joseph Kennedy III, grandson of the late Robert Kennedy, formerly announced the run for a Massachusetts seat held by Barney Frank. Kennedy is running as a Democrat. His family has deep roots in the fourth congressional district. It's the birth place of his great uncle, late president John F. Kennedy.

North Korea celebrating the birthday of deceased supreme leader Kim Jong-il. He would have been 70 today. The milestone commemorated by parades, speeches, huge crowds outside the palace. Current leader Kim Jong-un bowed before his father's portrait.

And another dose of "Lin-sanity." New York Knicks sudden star Jeremy Lin led the team to its seventh straight victory last night over the Sacramento Kings in front of a jam-packed, jacked up crowd in Madison Square Garden. The Lin legend growing with each day.


UNIDENTIFIED MALE: He wasn't drafted out of college. Two NBA teams, the Rockets and the Golden State Warriors both cut him. The Knicks scooped him up, but then sent him to the D league. But because of injuries he was called back to the team. And in one week this unknown Asian-American with a degree in economics from Harvard has put up LeBron James like numbers.

ROMANS: He came out of virtually nowhere.

UNIDENTIFIED MALE: Yes, he came out of nowhere, which is my nickname for Harvard.


UNIDENTIFIED MALE: Folks, you know things are rough when a Harvard economics grad has an easier time getting a job as an NBA point guard than a Wall Street bond trader.


ROMANS: You know something, Soledad, you have a better chance of coming out of Harvard of being president than a professional basketball player.

O'BRIEN: That's so funny. I didn't realize that.

ROMANS: Five presidents from Harvard and four professional basketball players, including Rob Marciano. He told me that.

O'BRIEN: Did he? I think he is right on that. Wow. So even more power to Jeremy Lin.

Let's talk about ad wars. Have you seen this new ad? It's a Rick Santorum ad making fun of Mitt Romney. We're going to play it for you now.


UNIDENTIFIED MALE: This time Romney's firing his mud at Rick Santorum. Romney and his super PAC have spent a staggering $20 million attacking fellow Republicans. Why? Because Romney's trying to hide from his big government Romneycare and his support for job cutting cap and trade. And in the end Mitt Romney's ugly attacks are going to back fire.


O'BRIEN: Effective?

LEE: Oh, absolutely.

O'BRIEN: Says the Democratic person. I have to couch everything you say this morning.

MATT TAIBBI, CONTRIBUTING EDITOR, "ROLLING STONE": It's so funny that these elections come down to who makes the best commercials. It doesn't have to anything to do with what the actual issues are. Would you agree?

O'BRIEN: That one he's really trying to bring the attention to the Romney and health care. There's a little bit of an issue in that although the actual ad --

TAIBBI: I just saw a dude shooting another guy with a gun. I didn't hear --

LEE: It's an inoculation ad. He knows the onslaught from mitt Romney is going to come, similar to what he did in Iowa to Newt and Florida when he put $20 million of negative ads on the air. So Rick Santorum is getting prepared for that because he's undefined right now. So Mitt Romney wants to take this opportunity in Michigan, which he needs to win, and try to define Santorum. So Santorum's putting this out ahead of time and saying here comes the old mud.

O'BRIEN: It's an interesting strategy, the ad about the ad that's to come.

WILL CAIN, CNN POLITICAL CONTRIBUTOR: I disagree with you, Matt. If it was about who makes the best ads Ron Paul would be winning. He has Spike TV director making his ads. They're awesome and he's not winning.

But I agree, this is a good ad. Mitt Romney and his team are in a tough spot. How do you go after Rick Santorum? It was very obvious how you go after Newt Gingrich. There was a buffet of items from which to pick from. In a Republican primary how you go after Rick Santorum, you aren't going to say you're more electable over and over. That's not very compelling. It doesn't inspire passion.

LEE: One of the problems that mitt Romney has is that he's getting criticism that he's not conservative enough. He can't go after rick Santorum. He is as right as the right, probably the most conservative one.

CAIN: I totally disagree with that.

LEE: So he can't really attack him.

O'BRIEN: February 28th will be the day to watch, the Michigan primary.

Still ahead this morning on STARTING POINT, $26 billion settlement from big banks in an attempt to repair the housing market. We have an exclusive interview with the HUD secretary of whether it is good enough or whether it falls short.

Plus, forced into marriage at the age of 17 and out of that marriage and out of her religion by the age of 23. We'll tell you about a woman who's written a new book about her life straight ahead.


O'BRIEN: Welcome back to STARTING POINT, everybody.

The White House is pushing today the benefits of that $26 billion mortgage settlement. Five largest home lenders have made a deal the largest to date addressing the housing meltdown; $17 billion will go for paying down mortgages for people who are underwater and behind on their payment; $1.5 billion for the 750,000 people who lost their homes to foreclosure; $3 billion to facilitate refinancing.

And all of that might sound like a whole bunch of money, but if you put it into perspective, more than $4 million -- I'm sorry, more than four million homes have been lost to foreclosure since 2007. An additional 11 million homeowners are underwater on their mortgages.

We've asked Shaun Donovan, of the Secretary of Housing and Urban Development to join us this morning. It's nice to have you we appreciate it. So why do you think it's going to work this time? Because these bailouts have been done and deals have been done before.

SHAUN DONOVAN, SECRETARY OF HOUSING AND URBAN DEVELOPMENT: Well, one of the things that's critical about this is that it's mandatory. This isn't a voluntary program. These aren't incentives. The banks have to do this and if they don't, there are huge financial penalties to them and because it's part of enforcement, it's registered in the court and we can go back into court and really force them to do this.

So it's very different from the other types of things that we've done before. O'BRIEN: So you're talking about HAMP and HARP. HAMP was the Home Affordable Modification program of 2009, HARP is the Home Affordable Refinance Program for 2009. Both of those they said are going to help millions and millions of people like five million people, four million people. They actually ended up helping both those programs under a million.

DONOVAN: Well, the facts are that in total we've actually helped about 5.5 million families get modifications to stay in their homes. And if you look at where we are today, foreclosures are down almost 50 percent since the President came into office.

So we've made progress. But the President said, we have to do more. Look, we've got a fundamental choice here. There are those who would say let the housing market hit bottom and when we really look at what that means, that means the families around this country whose life savings are invested in their homes that are going to send their kids to college with those savings, they're going to start small business, they lose those savings.

So we're going to keep going. The settlement is only one piece of a series of things we've announced over the last few weeks. Universal refinancing, unemployed homeowners can get more help than they were able to get before, a homeowner bill of rights. All of these fit together. The settlement alone isn't going to fix the whole housing crisis. We never said it would. We need all of these pieces to come together.

O'BRIEN: $700 billion in negative equity and then you compare that to this deal which is $29 billion. It's like, uh. I mean, it's not even close.

DONOVAN: But again, Soledad, nobody is -- this is the worst housing crisis this country has faced since the depression. And the fact is when you look at -- these are the servicing problems, right? The servicing problems hurt families. They made the situation worse for them but it didn't cause the crisis to begin with. What caused the crisis was the origination and the securitization of these terrible mortgages to begin with.

That's why at the very same time we announced this the President announced a joint task force with New York Attorney General Eric Schneiderman, a range of other state attorneys general where we're going to step up the work that we're doing to hold banks accountable on the things that really caused this crisis to begin with.

O'BRIEN: But in a way you're not holding some -- in some way you're not holding them accountable, right? Because this particular agreement states that the state -- settles a state and federal investigations about the foreclosure documents. You know what I'm talking about. There's part of the deal that will be open to investigation but in this deal part of it is closed.

DONOVAN: But again, the piece that we're settling here is not what caused the crisis to begin with. It was -- it made the crisis worse. It was horrendous what happened to many families. These are folks who lost their homes that shouldn't have, for many of them.

But the real cause of the crisis can't be solved just on the servicing side. That's why you have to see this in the context of a whole set of other -- and remember, Soledad, this is the biggest joint federal/state settlement in the history of the country.

It's -- it's the biggest accountability action to hold banks accountable of the crisis thus far, so it's important, don't get me wrong, but it's only one piece of a series of things the President has done over the last few weeks to help keep the momentum moving on the housing market.

MATT TAIBBI, "ROLLING STONE": But does the release only cover robo signing? I mean, I've heard reports lately that it actually is much broader than that, that it covers origination? What does it cover exactly?

DONOVAN: It -- it leaves a huge territory for us to continue to go out there. No criminal release whatsoever. No securitization release. All of our federal origination claims remain. No release of merge. The list goes on. No release of civil rights claims.


O'BRIEN: So all these things can be litigated?

DONOVAN: All of these things can be -- can be pursued. So it is --


O'BRIEN: Is there some origination that's being released?

DONOVAN: The states did choose to release their origination claims and that was part of an agreement they made to get $3 billion in help to homeowners for refinancing. The fact is many of those claims are old. The statute of limitations is running out. We've had -- we had a terrible decision a few years ago on pre-emption of state origination claims so that was a choice that the states made.

We at the federal level preserved our origination claims and in fact just yesterday we announced with Prith Bahar (ph) here in New York, we announced an agreement with Citibank where they're going to pay over $150 million just for a few years of violations around FHA origination claims.

So we're going to keep going on those claims moving forward.

WILL CAIN, CNN CONTRIBUTOR: Shaun, I've heard you say several times in this interview that this is one piece, one piece of what you hope to end up being a much bigger package. Will this work, will it work? How concerned are you guys? It seems to me that is all dependent upon one premise, that in three, four years home prices will be higher than they are today?

How confident are you that that's going to be the case? And how concerned are you that there's a mentality out there that set in that renting is smart?

DONOVAN: Well look, there is no question that there are real barriers that remain. The three key things we're facing, one is we've got to keep more people in their homes. More foreclosures we have, even though they're down by almost half, there's still too many. That's hurting other people's home prices. When a foreclosure sign goes up next door, your own home loses $5,000 to $10,000 in value. So that's key.

We also have to make sure that we're taking steps with those homes that are already sitting vacant on the market to renovate them, rebuild them. One of the things the President announced over the last few weeks is a project rebuild that would put 250,000 construction workers back to work rebuilding those homes.

CAIN: But am I wrong you are betting home prices will be higher in three or four years?

DONOVAN: Look, we've already seen encouraging signs with job growth up this morning. We had very good numbers on construction --


O'BRIEN: Is that a yes or a no? Sir?

DONOVAN: I am -- I am confident that these steps that we're taking are going to work and continue this recovery. It's not going to turn around overnight, let's be clear. This is the toughest housing situation the country's faced since the depression but we are making real progress.

O'BRIEN: We talked about some numbers that are pretty dire, four million homes lost to foreclosures since 2007, 11 million underwater for their mortgages. So how many do you think that this programs is going to actually help?

DONOVAN: Well, the -- we think the settlement itself will be close to two million. About one and three quarter million people will get help. But -- but again, with all the focus on the settlement, there are many other things that we've announced just over the last few weeks. We think an additional million people could be eligible for our modification programs with the changes that we made.

There are about three million, 3.5 million families that if we can expand the refinancing work we've done with Fannie and Freddie to other homeowners that are current on their mortgages and been doing the right thing, that's 3.5 million more families that could be reached there. So when you put all of these together, there is no single -- single piece. There's no silver bullet here, but all of these together can make a real difference and build on the progress that we're making.

O'BRIEN: Shaun Donovan is the HUD Secretary. It's nice to have you join us this morning. We appreciate it.

DONOVAN: It's nice to be with you.

O'BRIEN: Even though you're a little bit late.

DONOVAN: New York traffic.

O'BRIEN: I know. I know. I know we've got -- "End Point" is next for our panelists.

Stay with us we're back in just a moment.


O'BRIEN: And it's time for "End Point." We've been able to convince the secretary to stay with us. We'll get to him in a minute. We can't make him go first. Will Cain will start with us because we have all new people on our panel today. Go ahead Will. Give us your "End Point."

CAIN: I'm going to go back to this Romney versus Santorum narrative. The narrative that keeps getting pushed and super-imposed on these deals. You've got a concerned (INAUDIBLE) for some Massachusetts moderate. Penny voted (ph) it at one point. I have to push back on that. That is only true if you define conservative by either style or social conservatism. If you broaden it even slightly, that falls apart.

This election right now --

O'BRIEN: Duly noted, Will Cain. Yes. We're going to go next to --


O'BRIEN: Go ahead.

PENNY LEE, DEMOCRATIC STRATEGIST: Rick Santorum asked to be defined that way.

O'BRIEN: What's your "End Point"? No fighting. What's your "End Point"?

LEE: My "End Point" is my thoughts and prayers go out to the Houston family and all that are involved, all that will be mourning her loss not only as a mother, but as well as a daughter but also to the rest of Americans. We mourn the loss of a great singer.

O'BRIEN: Matt Taibbi, your column (INAUDIBLE) all the time. What have you got for us? TAIBBI: I'd like to end with a question for the secretary. Are we going to see anybody go to jail for robo signing, securitization, origination?

O'BRIEN: And this could be your "End Point", sir?

DONOVAN: Well, clearly we've done a set of things to hold folks accountable. There are folks serving time already for the mortgage meltdown. FHA lenders that we brought to justice that we found and there need to be more. There's no question about it.

The thing I would say about this settlement that some folks have missed is when was the last time you got 49 state attorneys general, 49 Republicans and Democrats happen to have to do anything together? I think one of the important things here is this is a step towards doing big things across party lines in this country.

O'BRIEN: And we'll leave it at that because "End Point" ended a minute ago.

Fredricka Whitfield, I apologize for the 43 seconds I've stolen from you. Forgive us --


FREDRICKA WHITFIELD, CNN ANCHOR: That's OK. I'm willing to share. It's all right.