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Egypt Passes Draft Constitution; Obama Speaks in Pennsylvania; Syria's Second Day Without Internet; Moving Towards Recognition for Syrian Rebels

Aired November 30, 2012 - 12:00   ET


SUZANNE MALVEAUX, CNN ANCHOR: Welcome to NEWSROOM INTERNATIONAL. I'm Suzanne Malveaux. We're taking you around the world in 60 minutes. Here's what's going on right now.

President Obama is taking his battle for a deal on the fiscal cliff on the road and to the American people. He's going to be making remarks shortly. This is going to happen in Pennsylvania. Going to bring it to you live, of course, when it happens.

And protesters flocking back to Cairo's Tahrir Square. Their anger over the Egyptian president's power grab is intensifying after a mostly Islamic assembly rushed to pass a draft constitution early this morning. The document is going to be presented tomorrow to President Mohamed Morsi for his signature.

Reza Sayah, he is overlooking Tahrir Square. Reza, we understand that they are planning what they are calling a million man demonstration that has been called. Give us a sense, why are people still protest and what do we expect in the next days to come, the next 24 hours?

REZA SAYAH, CNN INTERNATIONAL CORRESPONDENT: Well, they're protesting because they're angry with President Morsi, his decrees, and how the drafting of this constitution has unfolded. And there doesn't seem to be an end to the protests. They're back here in big numbers. Tens of thousands of them here in Tahrir Square.

We're going to show you what it looks like at this hour. I think one of the outcomes of the 2011 Egyptian revolution was that Egyptians became very good in protesting. So it doesn't matter what people are fighting for here. It seems they like to come out and protest.

The opposition factions are back here in Tahrir. These are the liberals, the seculars. We were just down there. We saw a lot of women, women's rights activists who don't like how this constitution was drafted. They don't believe they were well represented in the panel that drafted this constitution, and they're demanding that President Morsi annuls the draft of this constitution and starts over again. Suzanne, at this point, the president giving no indication that he's going to back away from his position.

MALVEAUX: All right, Reza Sayah, thank you.

Want to go directly to the president. He is speak now in Pennsylvania, talking about the importance of negotiations, not going over the fiscal cliff. Let's listen in.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: That ends up on store shelves in 30 countries is stamped "Made in America." And that's something to be proud of. That's something to be proud of.

By the way, I hope the camera folks had a chance to take a look at some of the K'Nex, including that flag made out of K'Nex. And, you know, Joe Biden was in Costco. He wanted buy some of this stuff, but I told him he had too much work to do. I wasn't going to have him building rollercoasters all day long.

Now, of course, Santa delivers everywhere. I've been keeping my own naughty and nice list for Washington. So you should keep your eye on who gets some K'Nex this year. There are going to be some members of Congress will get them, and some who don't.

This is a wonderful time of year. It's been a few weeks since a long election finally came to an end. And, obviously, I couldn't be more honored to be back in the White House. But I'm already missing the time that I spent on the campaign visiting towns like this and talking to folks like you.


OBAMA: I love you back. That's why I miss it.

And you know one of the benefits of traveling and getting out of the White House is it gives you a chance to have a conversation with the American people about what kind of country do we want to be and what kind of country do we want to leave to our kids. I believe America only thrives when we have a strong and growing middle class. And I believe we're at our best when everybody who works hard has a chance to get ahead. That's what I believe in. And I know that's what the founders of this company believe as well.

We were talking about these guys' dad and -- who I understand just passed away at the age of 101. So these guys have good genes in addition to inventive minds. And the story of generations starting businesses, hiring folks, making sure that if you work hard, you can get ahead, that's what America's all about. And that's at the heart of the plan that I've been talking about all year. I want to reward manufacturers like this one and small businesses that create jobs here in the United States, not overseas. I want to --


OBAMA: And, by the way, this is a company -- one of the few companies in the toy industry, that have aggressively moved jobs back here. You know, that's a great story to tell. Because we got the best workers in the world and the most productive workers in the world, and so we need champions for American industry creating jobs here in the United States.

I want to give more Americans the chance to earn the skills that businesses are looking for right now. And I want to give our children the kind of education that they need in the 21st century. I want America to lead the world in research and technology and clean energy. I want to put people back to work rebuilding our roads and our bridges and our schools. And I want to do all this while bringing down our deficits in a balanced and responsible way. Now --


OBAMA: On this last point, you've probably heard a lot of talk in Washington, and in the media, about the deadlines that we're facing on jobs and taxes and investment. This is not some run of the mill debate. This isn't about which political party can come out on top in negotiations. We've got important decisions to make and they're going to have a real impact on businesses and families all across the country.

Our ultimate goal, our long-term goal is to get our long-term deficit under control in a way that is balanced and is fair. That would be good for businesses, for our economy, for future generations. And I believe both parties can and will work together in the coming weeks to get that done. We know how that gets done. We're going to have to raise a little more revenue. We've got to cut out spending we don't need, building on the trillion dollars of spending cuts we've already made. And if we combine those two things, we can create a path where America is paying its bills while still being able to make investments and the things we need to grow, like education and infrastructure.

So we know how to do that, but, you know, in Washington nothing is easy, so, you know, there's going to be some prolonged negotiations. And all of us are going to have to get out of our comfort zones to make that happen. I'm willing to do that. I'm hopeful that enough members of Congress in both parties are willing to do that as well. We can solve these problems.

But where the clock is really ticking right now is on middle class taxes. At the end of the year, middle class taxes that are currently in place are set to expire. Middle class tax cuts that are currently in place are set to expire. There are two things that can happen. If Congress does nothing, every family in America will see their income taxes automatically go up on January 1st. Every family. Everybody here, you'll see your taxes go up on January 1st.

I mean, I'm assuming that doesn't sound too good to you. That's sort of like the lump of coal you get for Christmas. That's a Scrooge Christmas. A typical middle class family of four would see their income taxes go up by about $2,200. That's for a typical family. It would be more for some folks. That's money a lot of families just can't afford to lose. That's less money to buy gas, less money to buy groceries. In some cases, it means tougher choices between paying the rent and saving for college. It means less money to buy more K'Nex. Yes.

Just the other day, economists said that if income taxes go up on the middle class, people will spend nearly $200 billion less in stores and online. And when folks are buying fewer clothes or cars or toys, that's not good for our businesses. It's not good for our economy. It's not good for employment. So that's one path. Congress does nothing, we don't deal with this looming tax hike on middle class families, and starting in January everybody gets hit with this big tax hike and businesses suddenly see fewer customers, less demand. The economy, which we've been fighting for four years to get out of this, you know, incredible economic crisis that we have, it starts stalling again. So that's one path.

The good news is, there's a second option. Right now, Congress can pass a law that would prevent a tax hike on the first $250,000 of everybody's income. Everybody. So that means 98 percent of Americans, 97 percent of small businesses wouldn't see their income taxes go up by a single dime, right, because 98 percent of Americans make $250,000 a year or less. Ninety-seven percent of small businesses make $250,000 a year or less. So if you say income taxes don't go up for any income above $250,000, the vast majority of Americans, they don't see a tax hike.

But here's the thing. Even the top 2 percent, even folks who make more than $250,000, they'd still keep their tax cut on the first $250,000 of income. So it would still be better off for them too for us to go ahead and get that done. Families would have a sense of security going into the new year. Companies like this one would know what to expect in terms of planning for next year and the year after. That means people's jobs would be secure. The sooner Congress gets this done, the sooner our economy will get a boost. And it would then give us in Washington more time to work together on that long-range plan to bring down deficits in a balanced way. Tax reform, working on entitlements, and asking the wealthiest Americans to pay a little bit more so we can keep investing in things like education and research that make us strong. All right.

So those are the choices that we have. And understand, this was a central question in the election. Maybe the central question in the election. You remember. We talked about this a lot. It wasn't like this should come to anybody -- a surprise to anybody. We had debates about it. There were a lot of TV commercials about it. And at the end of the day, a clear majority of Americans, Democrats, Republicans, Independents, they agreed with a balanced approach to deficit reduction and making sure that middle class taxes don't go up. Folks agreed to that.

Now, the good news is, we're starting to see a few Republicans coming around to it too. I'm talking about Republicans in Congress. So the reason I'm here is because I want the American people to urge Congress soon, in the next week, the next two weeks, to begin the work we have by doing what we all agree on.

Both parties agree that we should extend the middle class tax cuts. We've got some disagreements about the high end tax cuts, right? Republicans want to -- don't want to raise taxes on folks like me. I think I can pay a little bit more to make sure that kids can go to college and we can build roads and invest in NIH so that we're finding cures for Alzheimer's. And that's a disagreement that we're going to have and we've got to sort out. But we already all agree we say on making sure middle class taxes don't go up. So let's get that done. Let's go ahead and take the fear out for the vast majority of American families so they don't have to worry about $2,000 coming out of their pockets starting next year.

The Senate has already passed a bill to keep income tax from going up on middle class families. That's already passed the Senate. Your members of Congress, like Alison (ph) and Shaka (ph), other Democrats in the House, they're ready to go. They're ready to vote on that same thing. And if we can just get a few House Republicans on board, we can pass the bill in the House. It will land on my desk. And I am ready. I've got a bunch of pens ready to sign this bill.


OBAMA: I'm ready to sign. I'm ready to sign it.

There are no shortage of pens in the White House. And I carry one around for an emergency just many case. Just waiting for the chance to use it to sign this bill to make sure people's taxes don't go up.

But, well, don't thank me yet, because I haven't signed it. I need -- I need some help from Congress. So the key is, though, that the American people have to be involved. You know, it's not going to be enough for me to just do this on my own. So I'm hopeful that both sides are going to come together and do the right thing.

But we all know you can't take anything for granted when it comes to Washington. Let's face it. And that's why I'm going to be asking for all of you to make your voices heard over the next few days and the next couple of weeks. I need you to remind members of Congress, Democrats and Republicans, to not get bogged down in a bunch of partisan bickering, but let's go ahead and focus on the people who sent us to Washington and make sure that we're doing the right thing by them.

I want you to call. I want you to send an e-mail, post on their Facebook wall. If you tweet, then use a hash tag we're calling My2k. Not Y2K. My2k. All right.


MALVEAUX: We've been listening to President Obama out of Hatfield, Pennsylvania.

He is at a toy company that makes toys similar to Legos, children's toys. One of the things that the president is trying to do, this is his strategy to bring his case directly to the American people, to travel to be there in front of real folks to make his case for avoiding the fiscal cliff.

Ad also his Treasury Secretary, as well, going up on the Hill talking to members of Congress, essentially putting forward his plan that would require tax hikes for the wealthiest Americans.

It is something that Republicans are not pleased with. We expect the Republicans' response very soon. We're going to bring that to you live.

If you would like to continue listening to the speech, you can go to and continue to listen to the president.

Up next, we are also focusing on another story. Each year, thousands of young British girls lured into a world of sex abuse. We're going to take a closer look at how predators are using gifts, alcohol, social media to gain the trust of their victims.


MALVEAUX: President Obama taking his fiscal cliff fight with Republicans on the road now. You saw he was just finished speaking at a toy factory company. This is in suburban Philadelphia. You see he is shaking hands with folks, doing the rope line. He is pushing his plan to avoid the so-called fiscal cliff. He is standing firm on raising taxes on the wealthiest Americans.

Want to bring in our chief White House correspondent, Jessica Yellin, to give us a breakdown of exactly what he has put on the table here because we know that both sides, they start off strong.

They start off with the best offer they got, the strongest offer they got and, clearly, the Republicans not quite happy about it. What is he offering?

JESSICA YELLIN, CNN CHIEF WHITE HOUSE CORRESPONDENT: Hi, Suzanne, and that is the best way to put it. It's sort of a starting position from the White House.

What Secretary Geithner laid out when he was visiting Capitol Hill yesterday was the headline, $1.6 trillion in new taxes as part of their overall vision to increase those taxes for people making $250,000 and more. But that also includes some changes to how much people can deduct, closing some loopholes, increasing taxes for dividends and capital gains and some other things.

Then some other aspects of the wish list from the president -- $50 billion in new stimulus spending next year and then, in return, they would find $400 billion in cuts to Medicare and other entitlements to be worked out.

Now, that is a starting position. You know, that sort of is the White House basically calling Republicans bluff, if you will, saying, look, you guys haven't come out with your own proposal. We're going to start high, come out with what we want. Now, show us what you got.

And the Republicans hate it. They're saying it's ridiculous. It's an overreach by the White House, so they're sort of in the standoff and it's ball in Republicans court to say what they'd counter with.

MALVEAUX: And, Jess, it's really interesting now because before everything was behind closed doors. Now, this is all playing out very publicly. You've got the president there in Pennsylvania. He is talking to real people. He is at a toy manufacturing place. And then you've got folks, the Republicans, taking to the floor criticizing the plan. I want you to hear. This is very direct and very straight here from Congressman Ted Poe of Texas.


REP. TED POE (R), TEXAS: This tax hike will hurt small businesses that provide 67 percent of the jobs in this country. That may fund the government for a short time. Then what's the plan? Stimulus 2.0. Because the first stimulus worked so well? That was a disaster as well. We have a $16 trillion deficit and the president wants to spend more money? Are you kidding me?


MALVEAUX: All right, Jess, so when do the serious negotiations take place here? That he puts an offer on the table through Secretary Geithner. The Republicans are now angry. Where is the next step here?

YELLIN: Well, you know, it's up to the Republicans to come back with something and now we're waiting to see what their next move will be. You know, the Republicans' position is this was a completely unreasonable offer and it does not balance out with enough spending cuts. They want to refocus on spending cuts instead of tax increases. So we should expect to see something from the Republicans that will be more heavily focused on the cuts.

But, you know, the White House is very clear. They are not going to give on that increase on tax rates and that's where the fight will take place over the mechanics few weeks, Suzanne.

MALVEAUX: All right, Jess, we'll be waiting to see if there's any more Republican reaction to the president's plan there because, obviously, he is using all the tools that he has to push forward his plan. We'll see how they come up with the alternative.

Thanks, Jess. We're going to get back to you in a bit.

The newly united opposition now in Syria may be actually on the verge of gaining a very important diplomatic reward from the United States. We have that story, the update of what is taking place in Syria, up ahead.


MALVEAUX: No Internet no, e-mail, no cell phone service. That is what most the people in Syria, they are actually dealing with this. This is the second straight day in a row. It was all suddenly cut off. No explanation. Just a short message from the government that said they are actually trying to fix this.

Now, some people still managed to upload videos of battle damage in Damascus. You can see this video here. This is evidence, they say, that the Syrian military is destroying the central telephone office. You can see the bullet holes in the crumpled walls.

Today, Syrian air force fighter jets shot across the sky over Damascus. You see it there. Witnesses are telling us about heavy fighting near the main airport there. All commercial flights in and out of Damascus are grounded for now. More than 30 people are reportedly killed today across Syria. The opposition says about 40,000 people have died in this country's civil war, but today the Obama administration is considering just how far they're going to try to step in to stop this.

Jill Dougherty has the story.


JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: With European partners like France and Great Britain recognizing the Syrian opposition as the legitimate representative of the Syrian people, the U.S. is moving closer is taking that same step.

ROBERT FORD, U.S. AMBASSADOR TO SYRIA: They are making real progress and I expect that our position with them will evolve as they themselves develop.

DOUGHERTY: But administration officials tell CNN no decision has been made yet. Discussions are still ongoing within the administration.

In two weeks there will be a "Friends of Syria" meeting in Morocco and a senior administration official says, "That is an opportunity for the opposition. They know the world is going to be seeing them at the meeting, so we'll just have to see how much progress they make between now and then."

Progress, as the U.S. defines it, includes creating a leadership structures something the opposition already is doing, and local committees.

VICTORIA NULAND, STATE DEPARTMENT SPOKESWOMAN: Many of them are now starting to take up the slack where government has receded, where the regime is no longer able to provide services, everything from trash collection to insuring that there's no vigilante justice. So we're watching those developments as well.

DOUGHERTY: Amid reports that the opposition now has obtained some surface-to-air missiles, the administration is deliberating whether or not to arm the opposition.

FORD: Will providing arms to the opposition t convince the people who support Bashar al Assad, in many cases they are afraid for their own existence, or will it simply lead to more fighting? That is the question that we are considering.

DOUGHTERY: A U.S. official tells CNN the Syrian opposition is maturing, that they're making tactical gains, that Assad's forces are having more difficulty beating them back.

But, this official says, factional infighting is a problem among the opposition, something they're going to have to guard against if they're going to be successful.

Jill Dougherty, CNN.