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Fiscal Cliff Finger Pointing; Palestinians Win Historic U.N. Recognition; Missouri Powerball Winner Identified; Egypt Passes Rushed Draft Constitution; Lady Liberty After Sandy

Aired November 30, 2012 - 06:00   ET


CHRISTINE ROMANS, CNN ANCHOR: Good morning. Welcome to EARLY START this Friday morning. I'm Christine Romans.

ZORAIDA SAMBOLIN, CNN ANCHOR: And I'm Zoraida Sambolin. John Berman is hosting "STARTING POINT." That's coming up at 7:00 so you can join them then. It is now 6:00 a.m. in the East.

It's getting personal. We begin the hour with insults, finger pointing, it's in the fiscal cliff debacle. In just 32 days, tax rates rise and spending gets slashed. And remember, Congress breaks for the holidays in 14 days. So, slash that number in half. And here's where things stand right now.

The president is pitching a plan that calls for $1.6 trillion in tax hikes and $50 billion in infrastructure spending. He will travel to a manufacturing plant in Pennsylvania today to sell that plan. Republicans sure aren't buying it. Listen to House speaker, John Boehner.


REP. JOHN BOEHNER, (R-OH) HOUSE SPEAKER: Despite the claims that the president supports a balanced approach, the Democrats have yet to get serious about real spending cuts.


SAMBOLIN: You know Democrats are getting right back at Boehner. Senate Majority Leader Harry Reid getting really personal.


SEN. HARRY REID (D-NV), MAJORITY LEADER: I don't understand his brain, so you should ask him.


SAMBOLIN: Athena Jones is live from Washington. So, Athena, where do we go from here? It sounds like the same old-same old.

ATHENA JONES, CNN CORRESPONDENT: Well, it certainly does. You know, all that happy talk you remember that right after the election is gone right now. We know the big sticking point is something you've already mentioned, this whole idea of taxes. Republicans and Democrats can't agree on how to go about raising tax revenue. Should they end the Bush tax cuts for the wealthy? That's what Democrats want to do. Should they close loopholes and cap deductions? Should they raise the capital gains tax and taxes on dividends as well, or some combination of all of the above?

Right now, they don't even seem to agree on the amount of money to be raised in revenue. Let's listen to what Senate Majority Leader Harry Reid had to say to explain the Democrats' position on this.


REID: We're ready to protect middle-class families from the fiscal cliff that they're facing by freezing the tax rates for the first $250,000 all Americans' income and letting the rates go up to the same level they were during the Clinton administration. Republicans know where we stand. We've said it. We've said it. We've said it so many times. The president's said the same thing.


JONES: And so Republicans do know where Democrats stand. This is certainly this idea of raising taxes on the wealthy is something that the president ran on in the last campaign.

But Republicans feel like there's been way to much focus on this whole tax side of things, and not nearly enough focus on spending cuts, which are also needed. Let's listen to what House Speaker John Boehner had to say about that yesterday.


BOEHNER: Right now, all eyes are on the White House. Our country doesn't need a victory lap. It needs leadership. It's time for the president, congressional Democrats, to tell the American people what spending cuts they're really willing to make.


JONES: And so you heard that there. The Republicans feel like the offer on the table, which is $400 billion in so far unspecified cuts, two entitlement programs like Medicare, that's from the White House. The Republicans feel like that's not enough.

But certainly Democrats say, look, we've put a number out there. We're waiting for you to give us a number on what you want to see happen on entitlement programs.

SAMBOLIN: Yes, but the lack of specifics a bit of a problem there. So we understand the president is taking his pitch to Pennsylvania today. What is he going to say to the American people? How does he plan to sell this? Some are calling aggressive approach.

JONES: Well, you know, it's interesting because since he campaigned on this, Zoraida, you will probably hear some of the same language we've been hearing for a month and certainly heard earlier this week. He's going to a toymaker.

He says this is the -- the White House said this is the kind of company that relies heavily on middle class consumers, the kinds of people who are going to see their wallets hit if there are tax hikes at the beginning of next year if there's no agreement.

This follows on what he did earlier this week where he had an event where he highlighted this idea of "My2k," which is about the amount of money $2,200 that the average middle class family could see themselves lose in their paycheck if there's a big middle-class -- if the middle- class taxes go up.

And so this is all part of a campaign to sort of win people over to his side. And Republicans aren't too happy about what they call this campaign-style event -- Zoraida.

SAMBOLIN: Yes, there's so much to do and so little time, right? The president said he'd like a deal before Christmas. We'll see if that's even possible. Athena Jones live in Washington. Thank you very much.

We'll talk about the prospects for a deal on the fiscal cliff in the next half hour when we're joined by Democratic Congresswoman Sheila Jackson Lee of Texas and Republican Congressman Tim Huelskamp of Kansas.

CHRISTINE ROMANS, CNN ANCHOR: All right, depending whom you ask this morning, the Mideast peace process is either taken a major step forward or a giant step backward that's because the United Nations General Assembly voted overwhelmingly yesterday to upgrade the status of the Palestinian Authority to non-member state.

Palestinians celebrated this endorsement of the move towards statehood, but the United States and Israel strongly opposed the resolution. It's a step in the wrong direction.

CNN foreign affairs reporter Elise Labott is in Washington to explain what it all means. Elise, why do the U.S. and Israel think that this is not a good move for -- for Palestinians?

ELISE LABOTT, CNN FOREIGN AFFAIRS REPORTER: Well, Christine, I mean, it signals the frustration on the part of the world and the lack of the peace process. And what the U.S. is saying is that it really doesn't give the Palestinians what they want, which is an actual state. It doesn't give them borders. It doesn't give them any sovereignty.

And so all of their U.S. argues is going to do is antagonize Israel and lead to more frustration if Israel withdraws -- withholds revenue, which is threatening to do, increases restriction on Palestinian officials, as a -- as a consequence of this move.

And there's also talk in the U.S. Congress about -- about cutting aid, if the Palestinians take further moves such as going after the Israelis and the International Criminal Court or not getting back to the peace table.

Let's listen to what Senator Chuck Schumer said yesterday after the vote about what Congress could do.


SEN. CHUCK SCHUMER (D), NEW YORK: We know that aid is important to them. We want to see prosperity in the territory under the Palestinian Authority's jurisdiction. But when they do this, they're just throwing away hopes for peace in any way. So we believe it's appropriate and right, and we hope it won't come to that.


LABOTT: But, Christine, you know, what it also does, on the pro side is it gives the Palestinians a little bit of international legitimacy for their goal for an independent state that they've been looking for, for so many years under Israeli occupation.

Let's listen to what President Abbas said after the vote about what this does for the Palestinians.


MAHMOUD ABBAS, PRESIDENT OF THE PALESTINIAN AUTHORITY (through translator): The Israeli aggression against our people in the Gaza Strip has returned once again, the urgent and pressing need to end the Israeli occupation and for our people to gain their freedom and independence.


LABOTT: So I think all eyes are on President Abbas. Now what is he going to do? If he, as he says, he says he's going to go right back to the peace talks. That's in the negotiations. He feels that this gives him a little bit of leverage.

If he goes the opposite direction, if he takes further moves against Israel in the International Criminal Court, he has these tools now, that could lead to real deterioration of relations with Israel, with the United States, and what the U.S. fears is further violence in the region -- Christine.

ROMANS: All right, Elise Labott, thank you so much, Elise.

SAMBOLIN: It is 7 minutes past the hour. Surveillance video may answer the $294 million question. Who bought the winning Powerball ticket in Arizona? Take a look, people, at this Maryland gas station saying this man walked into check his ticket and just started freaking out.

They say he told them he bought the ticket in Arizona. The 52-year- old Mark Hill is the lucky guy in Missouri, however. He bought his ticket at this Trex Mart.

Jenna Hanchard of KSHB joins us from Dearborn, Missouri, population of about 500 we understand. Jenna, this is the kind of town where everyone knows each other. I bet you are all buzzing about this, this morning. JENNA HANCHARD, KSHB REPORTER: Everybody is buzzing in this town. I mean, it's a small town, so news definitely travels fast. We talked to neighbors. They say that the winners this morning are Mark and Cindy Hill. They've lived in this area for several years.

They bought the ticket yesterday with about four other people. Now, this area, Dearborn, Missouri is about an hour from Kansas City. It's in between Kansas City and Saint Joe. So Mark Hill, he works nights in Saint Joe and actually Cindy Hill, she had a job interview yesterday, which she ditched out on -- on the last minute, understandably, because she won the lottery.

They just adopted a daughter. They have several kids here in the area and many people that we spoke with, they say that they deserve every single penny of this jackpot here. So after taxes, they're expected to get about $300 million from everybody is anticipating how are they going to spend all of this money. Zoraida, back to you.

SAMBOLIN: All right, so we want to put this in perspective for people there. So I hear that you have a very creative way of doing that for us. The money, that is.

HANCHARD: It is. It's very interesting. So the annual budget for this town here, Dearborn, Missouri, is about $800,000 to $900,000. So that means that they could essentially pay the town's bills for the next century. That's a lot of money.

SAMBOLIN: And Jenna, I got to tell you. This is another guy that hails from Chicago. It is really nice to see you this morning. Thanks for that story. We appreciate it.

ROMANS: All right, Egypt's constitutional assembly has passed a new rush draft constitution. The 85-member mostly Muslim Brotherhood assembly passed 234 articles. The draft will be presented to President Mohamed Morsi today. It needs to be approved by the Egyptian people.

Critics say that the language in some of the articles is open to interpretation and may allow conservative Islamists to oppose a rigid version of Sharia Law. Human rights groups say it's full of holes and ambiguities. The proposed constitution hasn't eased public anger, either, against Morsi's expanded presidential powers.

SAMBOLIN: The Supreme Court may decide as early today whether to tackle same-sex marriage. They're going to consider requests to review cases that challenge DOMA, the Defense Of Marriage Act, as a violation of the constitution's equal protections provision.

DOMA only recognizes marriage as between a man and a woman. It's also considering a challenge to Proposition 8, that's California's ban on same-sex marriage, which voters narrowly approved in 2008.

ROMANS: All right, she's bruised but not broken. Coming up, the exclusive look inside Lady Liberty. Looking at the damage left behind by Sandy we'll see what needs to be done to get this American icon back up and running. (COMMERCIAL BREAK)

SAMBOLIN: Welcome back. It is 14 minutes past the hour. So she took the worst of what Sandy had to offer and Lady Liberty is still standing. But the assume storm did set back her reintroduction to the huddled masses.

I went to Liberty Island about a month ago to take a look at her stunning touch up job and yesterday I went back. Take a look.


SAMBOLIN (voice-over): One month after Superstorm Sandy's wrath, Lady Liberty stands tall in New York Harbor. But the beacon of light is littered with debris, bricks ripped up from the ground. A boat washed up onshore at nearby Ellis Island, all the result of Sandy.

(on camera): So she survived.

UNIDENTIFIED MALE: Yes, standing there proud and defiant.

SAMBOLIN (voice-over): While the statue itself is intact, the grounds suffered enough damage to force the closure of the park to the public indefinitely. The National Park Service is now in the midst of a massive cleanup effort, in hopes of reopening both parks sometime early next year.

(on camera): How high did the water go here? I mean this is totally --

LUCHSINGER: Probably up here.

SAMBOLIN (voice-over): Before Sandy hit, I visited the Statue of Liberty for the first time. My return yesterday, very different. As we arrived, emergency crews filing in and not tourists. One month after Sandy devastated the area, there is still plenty of work to do.

(on camera): Now that's destroyed, you would say, right?

LUCHSINGER: Yes, pretty much.

SAMBOLIN: That's got to go.

(voice-over): That's one of the main docks to Liberty Island is now floating.

LUCHSINGER: Currently, our carrying capacity on this island is determined by how we can get people off. So, if we lose this dock, we lose one boat load, which means I have to reduce the number of people that come to visit.

SAMBOLIN: The effects of Sandy aren't just structural. Construction workers and ferry employees were laid off this week due to the extended closure of the both islands.

(on camera): So, did everybody lose their jobs? LUCHSINGER: No. The concessioners I understand have laid off their folks for the time being. But our folks, we just sent to other parks.

SAMBOLIN (voice-over): David Luchsinger is the superintendent of the Statue of Liberty. He can't help but take his work home with him. He actually lives here.

(on camera): How long did you live here?

LUCHSINGER: Three and a half years.

SAMBOLIN: It's just you and your wife?


SAMBOLIN: And did you lose everything?

LUCHSINGER: We lost most everything.

SAMBOLIN (voice-over): The offices next door a stark reminder of Sandy's toll.

(on camera): When you look around and compare it to your home and what you saw, how does it compare?

LUCHSINGER: It's not close. We are on the far corner. We sustained so much more damage.

To me, to have a job that you love, to have a job that you can come to and be so excited about every day, an honor I couldn't begin to describe.

SAMBOLIN (voice-over): But the Statue of Liberty remains a symbol of home and promise of the days ahead.

LUCHSINGER: As sad as it is to see it in the state it's in right now, I know it's going to be better.


SAMBOLIN: It is going to be better. And here's the good news, because to hate, seems like everything is bad news -- when they're rebuilding now they're going to rebuild sustainably, and he said that they are totally committed to that. So may take a little bit of time to figure it out. And also the amount of volunteers that went back there in order to make sure that the torch was lit.

So let's take a look at Lady Liberty. Can we take a live look?

OK, it looks really dark now, right? The torch is the only thing that's lit. The problem that happens here was that all of their infrastructure is underground. And so when all that water hit, they lost all their infrastructure.

So those folks are over there working with no lights, no heat, no water. But they are totally committed to the effort. And you know, when I went last time, I went to take a look inside of that $30 million renovation that makes it wheelchair accessible. The good news also is that that is perfectly fine.

ROMANS: Oh, good.

SAMBOLIN: Yes, and Lady Liberty. They went and they checked her out, somebody thought she had a tear. She doesn't. She actually was sand blasted.

So her original beautiful green color in her belly when you're out there -- take a look. It's different.

So there is some good news there. He said they definitely will be open within a year, actually maybe even less. He said it's not as bad -- that $30 million renovation was much more complicated than this. So there's some good news.

ROMANS: Exclusive look, that was really interesting.

Eighteen minutes after the hour. We're going to get you up-to-date on the morning's top stories now.

Fiscal cliff talks going nowhere. I sort of stumbled last hour, fiscal tiff is what I'm calling it now. The president hits the road today selling a plan that includes $1.6 trillion in tax hikes and $50 billion in stimulus spending.

You can imagine what Republicans thought about that. They are balking at the very least. House Speaker John Boehner telling reporters the president needs to, quote, "get serious on spending cuts."

Out of nowhere the earth collapsed. A giant sinkhole has developed near Dover, Ohio --

SAMBOLIN: Whoo, look at that.

ROMANS: -- south of Cleveland. Local residents cannot believe their eyes by how big this thing is.

It happened Wednesday afternoon. Taking part of a two-lane highway down with it. Fortunately, no one's been injured.

SAMBOLIN: Wow. Exciting discovery on the planet mercury -- ice. NASA's messenger probe discovering frozen water at the north pole of the planet closest to the sun. It's mostly found in deep craters that are always in the shadows. Scientists believe the water almost certainly came from impacting comets or asteroids.

ROMANS: All right. Thirty years ago today, back in 1982, Michael Jackson released "Thriller" -- an album that changed the music business and cemented Jackson's status as a superstar. Jackson made a series of music videos.

Let's listen to it for a second.

(MUSIC) SAMBOLIN: Did you see that video? Thirty years ago. I'm feeling really old.

ROMANS: Right. And then he made all these other videos to go along with the other hit singles like "Billy Jean," "Beat It," "Thriller" -- you know, the rest is history. The album won eight Grammys. It's the highest selling album ever. Sixty million to 110 million copies sold worldwide, 30 years ago today.

SAMBOLIN: My favorite part is coming up here. You know, didn't you want to move like this?

ROMANS: I know. The first time I ever saw that video, I was on roller skates.


SAMBOLIN: Oh, really? You're dating yourself.

All right. Call it the icing on the cupcake. Coming up, bonuses for the big bosses at Hostess now that the company's going out of business.


SAMBOLIN: Ooh, listen to this, folks -- our senior producer just got in our ear and said, ladies, we are bumping back with some stunning views of New York City.

So we are delivering them to you this morning, folks. Isn't that gorgeous? Look at that. Fine city. I wonder what our weather's going to be like today.

ROMANS: Happy Friday. It looks clear and crisp, though, and the blast for the weekend.

SAMBOLIN: Here we go. Good way to start your Friday.

Welcome back. Christine Romans is here and as usual, she is minding all of our business.

ROMANS: Yes, minding your business, Friday edition. U.S. stock futures up slightly this morning, but worries about the fiscal cliff persist, of course.

Markets finished up a bit yesterday but came off the day's highs after some downbeat comments from the House speaker about these ongoing fiscal cliff negotiations. So that's going to be the way of the world for the next month or so until this gets resolved.

U.S. bankruptcy judge approved those bonuses yesterday for 19 hostess executives of $1.75 million in bonuses for Hostess bosses, as long as they meet certain objections in shutting down that company.

The maker of beloved American staples like Twinkies, Wonder Bread, Ding Dongs, Ho-Hoes, closed its doors after the bakers union went on strike over pay cuts and benefits.

And while the two winners of Wednesday's Powerball jackpot, Uncle Sam has reason to celebrate, too, for the prize, whether take it as a lump sum or an annuity will be taxed at the highest federal income tax rate of 35 percent. If taken as a lump sum, the winners will get $192.5 million each before taxes, after federal and state taxes. The Arizona winners is going to take home $114 million and the Missouri winner will get about $117.5 million. The winners overall federal tax liability could likely be lower if they deduct their state taxes.

I'll tell you someone who's going to make money, their tax attorney, for whoever wins.

Now, the one thing you need to know about your money today is that the much-anticipated iTunes 11 is available for download today on both Apple and Mac computers. Software updates includes expanded integration of Apple's iCloud. Upgrade instant playlist feature. It is here. It's available today.

SAMBOLIN: I need somebody to walk me through that iCloud thing.

ROMANS: You've got kids. That's what kids are supposed to do, right?

SAMBOLIN: That's true. I should ask my son.

ROMANS: Everyone needs a 12-year-old.

SAMBOLIN: All right. Twenty-six minutes past the hour.

America's oldest living president is waking up in the hospital this morning. What doctors are saying about President George H.W. Bush is coming up. And if you are leaving the house right now, you can watch us any time on your desktop or your mobile phone. Just go to