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FDA: Stop Taking Recalled Generic Lipitor; Bankruptcy Judge OK's Hostess Exec Bonuses; Rebels Threaten Syria's Capital; North Korea A Step Closer to Launch; Boehner Sees Fiscal Cliff "Stalemate"

Aired November 30, 2012 - 17:00   ET



Happening now, death and desperation -- Syrians risking their lives in search of food as civil war rages on.

CNN is there on the ground.

New satellite images reveal an unusual and provocative move by North Korea.

And the Pentagon draws a line when it comes to killer robots.

Welcome to our viewers in the United States and around the world.

Wolf Blitzer is off today.

I'm Joe Johns.


The battle for Syria is now raging around Damascus and rebels threaten to cut off the capital from the outside world. The road to the international airport there has reportedly been reopened, but flights remain grounded. In the north, rebels are making gains around the city of Aleppo.


JOHNS: This video is said to show rebels targeting regime loyalists. More than 100 people reportedly died across the country. Information is scarce, and with an Internet and cellular blackout continuing for a second day.

But CNN has senior international correspondent, Arwa Damon, on the ground in Northern Syria -- thanks for joining me, Arwa.

How are people communicating there?

ARWA DAMON, CNN INTERNATIONAL CORRESPONDENT: With a lot of difficulty, if they even have the ability to communicate at all. This cell phone and Internet blackout is really impacting everybody, from opposition activists, who rely on it to upload videos; to rebel fighters, who do not have sophisticated military technology, such as long-range radios, who do quite often rely on cell phones to communicate amongst units when they are quite far from one another; to just ordinary people who want to check in on their families when they hear about strikes taking place in one part of the country or the other.

JOHNS: Now, you were in Aleppo.

What's happening on -- there?

DAMON: Well, we were in one particular neighborhood of Aleppo that was, according to what the rebels were telling us, the first neighborhood of Aleppo to fall to the Free Syrian Army. And there were quite the images that we were seeing and that we've filmed of the widespread destruction that took place there.

But what we are now seeing is some of the residents beginning to return. And they began to return around three or four weeks ago, trying to rebuild their homes. Some of them were trying to fix electrical lines. We met a young woman waiting in line at the bakery and there was a mob that was there, because bread is so hard to come by. She'd been waiting for three hours. But what happened to her is that her husband was actually wounded when she and their three children and her husband came back to this neighborhood, thinking that it was safe.

In fact, just a short distance from the bakery, there had been an air strike that had burst a water main. There we met a 14-year-old boy who was filling containers. And his arm was in a sling. And he said that he'd been wounded in the village that his family had fled to for safety.

So it just gives you an idea of just how much of a gamble it is for people. Wherever they go, there's always that constant risk, that constant threat.

JOHNS: We've heard, in the last couple of days, that the rebels are making progress.

Where does that stand?

DAMON: Well, according to what our rebel commanders are telling us, bearing in mind that they do say that this is an ever shifting battlefield. The front line is constantly changing.

When it comes to Aleppo in particular, they do believe that they control around 85 percent of the province. That is not including the city of Aleppo itself.

When it comes to the city of Aleppo, they're telling us that the regime does not control 65 percent of it. And that most certainly shows just how many gains they've been able to make, given that they are effectively battling this out on their own, with no significant international financial or -- or military support.

And so they are able to continuously take the fight to the regime's forces. But it continues to be an incredibly difficult and incredibly deadly, not just for them, but for the residents, as well, because even in these neighborhoods that -- that the regime no longer controls, in the sense that there are no regime forces in them, there are certain lines that people need to learn not to cross, because snipers based in other neighborhoods can target them. And then, of course, there's that constant threat coming from the air, as well.

JOHNS: Right. The regime controls the air.

DAMON: Most certainly, it does. And we've seen the -- the devastation caused by these air strikes, by the helicopters, over and over again.

That being said, there has been a slight shift in the dynamics, because just over a week ago, the rebels were able to capture a significant military base where they were able to get their hands on some surface to air missiles. They do have some surface to air machine guns that they are able to use. They have been able to bring down some of the aircrafts. In fact, earlier in the week, they brought down two helicopters and a fighter jet in the span of just 24 hours.

But again, this does still very much remain an uneven battlefield.

JOHNS: Arwa Damon, thank you so much for your reporting.

Stay safe.

Nuclear-armed North Korea may be another step closer to a long- range rocket firing. Whether it's an attempted satellite launch or testing a missile, either way, it would be a violation of U.N. resolutions.

The United States is watching closely.

And so is CNN Pentagon correspondent, Barbara Starr -- Barbara, what's the latest?

BARBARA STARR, CNN CORRESPONDENT: Well, Joe, either way, is -- the question on the table is, is North Korea, in fact, getting ready to launch what essentially would be an intercontinental ballistic missile that could -- could strike the United States, another test of what so far has been failed technology?

We are looking very closely at some specific satellite imagery.

I want to put up the first picture for you. This is a very recent commercial satellite image from DigitalGlobe, a commercial satellite company. Two pictures there. Have a look.

This is at a rail station. And what we see are vehicles and a heavy crane, equipment used to move fuel tanks and other launch- related equipment at this very site. So we see the activity in very recent days, more and more activity, indicating they might be getting ready for a launch. This was around the rail head at the site. Go to the second image. Now, we see, a few days later, the similar trailers that are used to move some of the other launch- related equipment. They're now by a missile assembly building. DigitalGlobe says this could be an indication that the missile components are now inside and these trucks are just waiting to take them to a launch pad.

But here's the bottom line, Joe. U.S. intelligence says they wonder, is North Korea maybe just messing with everybody's head, moving a bunch of stuff around, knowing that satellites can see it?

Or are they, in fact, getting ready for yet another test launch -- Joe.

JOHNS: So why would they create confusion like that, Barbara?

STARR: Well, you know, it's North Korea. Isn't that -- they have...


JOHNS: Yes. Yes.

STARR: They...


STARR: -- they like to mess with everybody's head.

The -- the real fascinating question here is if, in fact, all of this is leading to another intercontinental ballistic missile launch. They just did one in April. It failed miserably, 90 seconds off the launch pad.

So are they willing to risk it again or have they gotten some kind of advanced engineering help, design help, that makes them think they've solved their problem and that they can do this?

If they believe that, the question for U.S. intelligence is who's been helping North Korea?

JOHNS: Right. So they'd be pushing on this sort of to save face.

STARR: Well, maybe. That is, in fact, exactly the other theory. If they're just moving stuff around or they're going to do it anyhow, cross their fingers and hope for the best, the new leader, Kim Jong Un, just in power about a year, is this his response to the pressure from hard-liners inside the regime?

Does he feel he has to do this?

JOHNS: Barbara Starr at the Pentagon.

Thank you so much for that.

STARR: Sure.

JOHNS: ""Wizard of Oz" crazy" -- that's how one Republican lawmaker describes President Obama's proposal to keep the country from going over the fiscal cliff. We have new details on the standoff that could impact all of us.

Plus, new scrutiny of Susan Rice -- why questions are being raised about one of her investments.


JOHNS: President Obama and House Speaker John Boehner both talking today about the looming fiscal cliff, but not to each other. The president was making his case on the road, while Boehner was dismissing the White House proposal as a joke.

CNN senior Congressional correspondent, Dana Bash, joins us live from the capital -- Dana, what's the latest?

DANA BASH, CNN CORRESPONDENT: Well, Joe, it turns out that the Senate Republican leader, Mitch McConnell, laughed at the Treasury secretary, Tim Geithner, when he proposed the White House package yesterday, which includes $1.6 trillion in tax increases.

Instead, today McConnell floated to "The Wall Street Journal" the idea of raising revenue by means testing Medicare and raising the eligibility age.

But I can tell you, Democrats are very dug in. They say anything that doesn't include tax increases on the wealthy is a nonstarter.


BASH (voice-over): A day after getting a White House proposal that Republicans greeted as a joke, they're not laughing.

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: Now, the White House took three weeks to respond with any kind of a proposal. And much to my disappointment, it wasn't a serious one.

BASH: House Speaker John Boehner rushed to the cameras to respond to the president's campaign-style event at a suburban Philadelphia toy factory, where Mr. Obama tried to rally support for maintaining the Bush era tax rates for middle class Americans, but increasing tax rates for the wealthiest Americans.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I don't think it's acceptable to you for just a handful of Republicans in Congress to hold middle class tax cuts hostage simply because they don't want tax rates on upper income folks to go up.

BASH: Oftentimes, this kind of public toing and froing masks active behind-the-scenes negotiations. The speaker insists not this time.

UNIDENTIFIED FEMALE: Is this the necessary public posturing that needs to go on to get an end game or is there a serious stalemate right now?

BOEHNER: No, there's a stalemate. Let's not kid ourselves. I'm not trying to make this more difficult.

BASH: Boehner argues he took a political risk, offering after the election to raise revenue other than tax rates, and the White House has offered little in return.

BOEHNER: The White House spends three weeks trying to develop a proposal. And they send one up here that calls for $1.6 trillion in new taxes, calls for a little, not even $400 billion in cuts. And they want to -- they want to have this extra spending that's actually greater than the amount they're willing to cut. I mean it's -- it's -- it was not a serious proposal.

And -- and so right now, we're almost nowhere.

BASH: GOP sources tell CNN what irked them most wasn't the big philosophical difference over raising tax rates for the wealthy, it was two other proposals in the White House package -- $50 billion in stimulus spending and allowing the president to raise the debt limit, making it tougher for Congress to stop it.

One GOP Congressman called that, quote, ""Wizard of Oz" crazy."

But many Congressional Democrats spent the first Obama term frustrated with the president for not standing up to Republicans enough. Now Democratic leaders are elated.


REP. NANCY PELOSI, (D) MINORITY LEADER: Elections have consequences. The president campaigned. He made it very clear -- he made it very clear that he was supporting a tax cut for the middle class, that he wanted the expiration of the tax cuts for the high end.


BASH (on-camera): And at the end of the day, Joe, that is still the most significant, the biggest stumbling block on the road to the fiscal cliff, that difference between tax rates for the wealthiest Americans. And what House Democrats announced they're going to try to do is an end run around the house GOP to try to file a petition in order to try to push a vote on the House floor to just raise taxes -- excuse me, to just extend the Bush-era tax rates for middle class Americans.

But to do that, as you know, you've been up here, they need 218 votes, and there still is a very sizable Republican majority in the House. It will be difficult for Democrats to do that.

JOE JOHNS, CNN ANCHOR: Absolutely. And that proposal to take away what has been historically a Congressional prerogative was a little bit surprising even to people who've been reading about this stuff for years. Is it true though, Dana, as it has been in past years that both sides at least have to show their bases that they're fighting the good fight and that's part of what's going on here?

BASH: Absolutely. There's no question about it. And what I mention in the piece really is a real phenomenon here when it comes to the feeling among Congressional Democrats that they are saying Hallelujah. They really felt like the president didn't stand up enough to Republicans over the past four years and that he didn't do what they say Republicans do which is put his cards on the table.

So, yes, he added some sweeteners, some things from a long list of Democratic wish list. But it's something that they say, you know, is sort of negotiating 101. Put everything on the table and see where they end up. Republicans are not happy about it. That's for sure.

JOHNS: Got it. OK, Dana. Let's get more now with CNN chief national correspondent, John King. When you look at this thing, it's just a big game of chicken.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Well, it's a big game of chicken except the stakes are rather enormous. The risk of sending the economy back into recession, the risk of having the financial markets decide yet again no reason to have any faith or trust in Washington. The risk of global contagion if the United States goes off this cliff.

So, as Dana noted, most everyone thinks, in the end, they'll get this done. This is the time to sort of plant your flags, and as you just noted, appease your base. But there's a risk because we're in such uncertain times after the election. The Republicans are looking at a presidential defeat, but they still have the majority in the House.

Their leader in the Senate is up for election in two years. He could face a primary challenge. So, as Mitch McConnell told "The Wall Street Journal" today, he wants to see the president put some specifics on the table. He wants to see the president make those Democrats mad and say I will raise the Medicare eligibility age.

I will touch Social Security. I will means test Medicare for more affluent Americans. Democrats are OK with that, some of them anyway. He wants the president to show some specific entitlement cut cards and then he'll say, then I'll get you some revenues from the Republicans, but both leader McConnell and Speaker Boehner right now, Joe, you know this very well, they don't want to give the president the trophy the Democrats want.

The Democrats want that rate increase. That has been the trophy they have wanted since the Bush tax cuts were first put in place in the previous administration. They've want it the entire four years of the first Obama term. They want it now. Republicans say they won't give it to the president. So, sure, you can call it chicken, you can call it a kabuki dance, but the stakes are pretty high.

JOHNS: You know, it's interesting. You wonder if they sort of remembered what happened just a few years ago with TARP. You know, there was a point where the Congress couldn't come to an agreement on TARP, and they ended up sinking the stock market by 700, 800 points. Today, I was watching as the president and John Boehner were speaking watching the stock market, ticking down, ticking down. A huge danger or, again, is this just drama?

KING: It is a huge danger. There's been small fluctuations, relatively small fluctuations at the moment. The markets have sort of invested themselves. They have factored in. We're going to have this posturing. We're going to have this dance. So, one or two days are not going to cause, we hope, anyway, a precipitous drop in the market.

But as you get closer to Christmas and closer to the cliff, that's why -- all these deals are usually cut at the last minute. They need to cut it at the second or third last minute here to keep people from getting nervous in the market. But remember, Joe, you mentioned, TARP, come more recently to that grand bargain, John Boehner and the president almost struck about a year and a half ago.

Since then, there's been a huge trust deficit. And, these are very specifics that the republicans going to have to give on rates, the Democrats are going to give on spending and entitlements. Neither side wants to do that after the election. The wounds are still deep.

To get a deal like this done, you need trust. And it's pretty clear today that important first step rebuilding the trust deficit, closing the trust deficit, a long way to go.

JOHNS: John King, thanks so much. Good to see you.

A warning from the FDA about one of the most prescribed drugs in the U.S. New details of a massive recall.


JOHNS: In Wyoming, authorities were investigating the deaths of three people at two crime scenes in a bizarre case. Lisa Sylvester's monitoring that and some of the other top stories in the SITUATION ROOM right now. Lisa, what do you have?

LISA SYLVESTER, CNN CORRESPONDENT: Hi there, Joe. Well, here's what we know. Police responded this morning to a call at the campus of Casper College in Eastern Wyoming. They say a sharp edged weapon was involved. And when it was all over, three people were dead, including a college faculty member and the suspect who died of an apparent suicide. Authorities say all three victims knew each other.

And if you take a generic form of the popular drug Lipitor, well, you want to take note. The Food and Drug Administration says you should stop taking the cholesterol drug if it came from one of 41 lots recalled a few weeks ago. It's because of concerns about possible contamination with specks of glass. Some pharmacies are still telling customers that it is OK to take that medication.

And an accused ecoterrorist wanted in connection with a string of fires across the west has surrendered at the U.S./Canadian boarder. According to authorities, Rebecca Reuben (ph) was part of a group responsible for the fire that destroyed a lodge and other buildings at the Vail, Colorado, ski resort in 1998. Rubin was a fugitive for ten years.

And a federal bankruptcy judge finalized liquidation of Hostess brands approving a bonus plan for its senior executives. The bonuses range from $7,000 to $130,000. The union opposed the plan, but the judge noted that rank and file employees were also getting paid beyond their regular salaries. The makers of Twinkies will be closing its doors after 82 years. And that's the big thing.

JOHNS: Pretty sad.

SYLVESTER: Yes. People mention Hostess and you automatically think of Twinkies. But, you know, it's possible that you might have another company buy the brand and line. So, maybe the Twinkies will make a comeback.

JOHNS: Right.

SYLVESTER: But it's hard to believe 82 years and all those workers.

JOHNS: I know. It is sad, isn't it? Awful. Thanks.

New Israeli settlement, some fear they're making Mideast peace more allusive than ever. Now, the U.S. weighs in.


JOHNS: Palestinians are still celebrating the historic vote to enhance their status at the United Nations, but does action strongly oppose by the United States and Israel change anything? Last hour, we spoke to Palestinian Prime Minister, Salam Fayyad, who said the vote was needed to gain leverage in negotiation for a two-state solution.

As for the relationship with the U.S., he says the key is to move on and focus on what to do next. Joining me now, Middle East expert, Fouad Ajami, senior fellow at the Hoover Institution. Thanks for coming in, Fouad. When you look at this thing, the United States and Israel essentially accused by the prime minister of complaining too much. Do you think that's true?

FOUAD AJAMI, SENIOR FELLOW, HOOVER INSTITUTION: Well, I think what we have to go and look back on the vote that took place at the United Nations on Thursday. And, Joe, that was a remarkable day in terms of, you know, the symbolism of it. It was November 29. And November 29, 1947, was the famous vote of the United Nations that partitioned Palestine into a Jewish state and Arab state.

So, on the 65th anniversary of that vote, the Palestinians come back and get from the United Nations what they call the birth certificate of their own nation state. And when you take a look at the lopsided vote, it was amazing. What you had is 138 states voted for the Palestinians, nine states voted against them, and 41 states abstained.

And when you take a look at the people who voted with the United States, it was only the United States, Israel and Canada and a number of islands in the pacific. So, it was cooked in the general assembly.

JOHNS: In terms of tangible gains, what changes? Is there anything that really changes with this new non-member observer status?

AJAMI: You know, Joe, I think what changes is the balance of power somewhat between Hamas and Gaza and the Palestinian national authority and Ramallah. We have to think about the Palestinians. They now are so divided. They have two capitals, one in Gaza under Hamas, an Islamic jihad, and one in Ramallah under Mahmoud Abbas and his authority.

Now, the Palestinian authority in Ramallah has taken a beaten. It seemed relevant and the people in Gaza, the Hamas men, the Hamas warlords, seemed very mighty. So in a way there is kind of a rectification of the balance between Ramallah and Gaza. This really is what mattered to the Palestinian negotiators.

And then there is the symbolism. The symbolism is that they do have this what they call the birth certificate. And the irony is, here is something I really like when you think of ironies of history. The Palestinians had a chance to be the number 59th state in the General Assembly in 1947. They are now the 194th state. So it was late, but that was what you had with the vote.

JOHNS: If you take the 30,000-foot view, the talks are stalled which leads to the question, did Palestine really have any choice?

AJAMI: Well, no. You're right. We have had no talks in a way. You're absolutely right on Palestine. I mean, the last president -- the last American president who was committed to talks between Israel and the Palestinians let's give him credit, it was Bill Clinton. He had a passion for that issue. And he wanted to negotiate a settlement between Israel and the Palestinians.

George W. Bush could not care. He wanted to fight the war on terror. And he thought the Palestinian question was not the issue of the hour. And then came President Obama. And he paid this conflict no attention. For what you have now is 12 years without any major movement on the Palestinian question. And that's why this vote had this kind of impact.

JOHNS: Let's talk now about this report that Israel is planning to build thousands of new houses in the West Bank. The spokesman for the State Department, Victoria Nuland, talked about that. Listen to this and we'll discuss it.



VICTORIA NULAND, STATE DEPARTMENT SPOKESWOMAN: We reiterate our longstanding opposition to settlement activity and east Jerusalem construction and announcements. We also believe that these actions are counterproductive and make it harder to resume direct negotiations.


JOHNS: Suggesting that perhaps this is a step backward for Palestine.

AJAMI: Well, I think there are reports from Israel in fact that tell us that maybe these settlements will not be built because they are in a very sensitive area. What you have is you have Prime Minister Netanyahu staring at an election on January 22nd. And then in the back, in the background you have this lopsided vote at the United Nations.

You have a situation where even a state like Germany, which is really the most sympathetic state in the international system to Israel, ended up abstaining on that vote. So I think this idea of the settlements, this talk about building these settlements comes against this kind of background. And there is a real possibility that this will not happen.

JOHNS: Move quickly now to Syria. The United States recognizing the Syrian opposition council is the true and legitimate government.


JOHNS: Do you think this is a little late?

AJAMI: Oh, well, as they say in a way that is so late. That is so lame in a way, Joe. That's so lame. You have -- you have nearly two years of slaughter. You have Bashar al-Assad using his air force against his own people. You have 40,000 dead by United Nations estimate when the real numbers are much, much higher. And you have the disintegration of Syria and then finally the Obama administration is talking about recognizing this new national coalition in Syria.

It really tells you about the abdication towards Syria. And I think the one official in our government who was the lead on this issue, who really ran out the clock on the Syrians is none other than Secretary of State Hillary Clinton.

JOHNS: Should the United States be providing arms at this point? Or is that just too far?

AJAMI: Well, I think we have to provide arm. It's amazing. We keep -- we keep complaining that there are jihadists in Syria. We keep complaining maybe these people will have -- will have anti- aircraft missiles. But we don't talk about what the violence inflicted on the Syrian people.

I think it's way late in the hour. And I think we owe it to the Syrians to be truthful with them. And we owe it to ourselves to recognize a genuine humanitarian disaster in Syria.

JOHNS: Fouad Ajami, always good to see you in the SITUATION ROOM.

AJAMI: Thank you, Joe. JOHNS: The U.S. is rapidly approaching the fiscal cliff with predictions of dire consequences for the entire country. We'll look at what that could mean for you.


JOHNS: What will it mean to you if there's no financial deal between the White House and the Congress? CNN's Tom Foreman is here.

Probably a lot of things, huh, Tom?

TOM FOREMAN, CNN CORRESPONDENT: Yes, it really can, Joe. And here's the thing, you know, there's all this talk in Washington. Washington gets all caught up in the politics of it all. Will the Republicans win, will the Democrats win, will the president win.

What really matters is what it's going to mean to you out there. And look what happens -- if the fiscal cliff hits and nothing changes. As you go and look at the first group of folks up here, let's talk about people who make very little money, up to $20,000 or $20,000 to $40,000. This yellow part here represents the current amount of taxes folks are paying out there.

If the fiscal cliff hits and nothing changes, this group would pay about $400 more. This group down here would pay about $1200 more. That doesn't seem like a whole lot of money but again it's that kind of income, it's pretty big.

Let's move on to the next category, though. If you go to $40,000 to $64,000 in income or $64,000 to $108,000 -- you see the green area is much bigger? That's because there are a lot of taxpayers like this. And they're paying a fairly sizable amount. But if they're out there and the fiscal cliff goes all the way through and nothing stops it, look what's going to happen. Almost $2,000 more for this group. That's what you would have to pay if you're in that group. And look down here, at the other one down here, $64,000 to $108,000, $3500 more on that.

And then as you move up it gets even more so. If you go up to this group, people make $108,000 and up, and certainly if you live in a lot of major metropolitan areas, that is not a whole lot of money. You're already paying a pretty good bit of taxes. But look what happens if you go beyond that. You might have to pay an additional $14,000.

So, Joe, that's why all the talk is going on here. This idea that there are a lot of normal people out there who have no gain one way or the other politically in this, but they do have real dollars at stake while Washington keeps fiddling and Rome keeps burning.

JOHNS: Absolutely. And especially when you have the president of the United States saying he wants to increase taxes on the top earners. That's even more attention for people in those higher tax brackets.

FOREMAN: Yes, it is. And the impact really, really becomes much bigger up there. You have to consider this. Let's move down and take a look at that amount. What he's talking about is this $250,000 income threshold for two people. That's what we constantly hear Tax Policy Center did some analysis on it.

Right now if you're in that area you have about a 33 to 35 percent tax rate here. The reason it's a range here is because this is a very broad number, over $250,000, well, that includes some couples somewhere that's worked very hard in their life and now they're each making $150,000 supporting kids in college, all of that. That may not be a lot of money in a major metropolitan area. But this also includes Bill Gates and Warren Buffett and people who make a whole lot more than those people do.

Under the Obama plan, these percentages would tick up this much. So this is what he's pushing for against those other losses to the middle class, which Republicans are talking about as well. The bottom line, though, is -- and this is something that everyone is going to have to bear in mind, no matter how this turns out, an awful lot of economists say even if you do this, that doesn't mean everyone else will ultimately be off the hook, because there's still a revenue problem in this government right now.

And over time there's a lot of hints that somehow those people in the middle class we talked about a moment ago are going to be nibbled at too even if the fiscal cliff is taken care of, Joe.

JOHNS: Tom Foreman, thank you for that.

There's a new controversy dogging the embattled U.S. ambassador to the United Nations. Susan Rice has been under Republican fire for weeks over the attack on the U.S. consulate in Benghazi. Now questions are being raised about one of her investments and a possible conflict should she be tapped to replace Hillary Clinton.

CNN's Mary Snow is in New York with details.

Mary, what is this all about?

MARY SNOW, CNN CORRESPONDENT: Joe, this is about Susan Rice's financial link to the 1700-mile oil pipeline that environmentalists have been fighting. And the next secretary of state will be facing key decisions about it.


SNOW (voice-over): The latest controversy surrounding Ambassador Susan Rice involves a major investment in the company that wants to build a controversial Keystone XL pipeline. Rice owns between $300,000 and $600,000 worth of stock in TransCanada, according to her own financial disclosure forms.

The Keystone pipeline would connect the tar sands oil development in Canada to the U.S. Gulf Coast. And if Rice becomes secretary of state any decision on it would fall under her jurisdiction.

BOB DEANS, NATURAL RESOURCES DEFENSE COUNCIL: We need for the next secretary of state to be completely unburdened of any interest that could present any conflict or the appearance of a conflict.

SNOW: Bob Deans of the Natural Resources Defense Council is among those opposing the pipeline for environmental reasons. His group's online publication brought Rice's investments to light.

White House press secretary was asked Thursday if that would pose a conflict.

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: So I have no -- I'm not going to speculate about a personnel decision the president has not made. A nomination he has not put forward.

SNOW: The TransCanada Holdings is just one part of a sizable portfolio of Rice and her husband who is from Canada. The watchdog group Center for Responsive Politics estimates the couple's net worth between $23.5 million and $43.5 million as of 2009.

Her financial link to TransCanada was not an issue in her current position as U.S. ambassador to the U.N. If she became secretary of state, she would have to divest her holdings linked to Keystone pipeline or put them in a blind trust.

A spokeswoman for Rice said in a statement, "Ambassador Rice has complied with annual financial disclosure and applicable ethics requirements related to her service in the U.S. government and is committed to continuing to meet these obligations."

Whiled the NRDC is speaking out about Rice's potential conflict of interest, its spokesman says it supports her potential nomination and would not ask her to recuse her herself from the Keystone pipeline decision.


SNOW: Now another group, the liberal group which is an online group, launched a petition online. It's demanding Rice sell all of her stock. Not only in TransCanada but other Canadian companies that could stand to benefit if the pipeline is approved -- Joe.

JOHNS: Mary Snow in New York. Thanks for that.

SNOW: Sure.

JOHNS: You've seen it in the movies, robots able to kill without human controllers. One day that will be a reality. What the Pentagon is doing about it right now.


JOHNS: Unmanned aircraft are being used with devastating effect against terrorist targets, but they're being controlled by humans sometimes thousands of miles away. In a couple of decades, though, robotic weapons may be able to kill without human help. Just like in the movies.

CNN Pentagon correspondent Chris Lawrence is with us.

Chris, Defense planners are concerned about this.

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: Yes, Joe. I mean, they're worried enough to issue the very first directive on these autonomous lethal systems, in effect setting up rules for technology that doesn't even exist yet.


LAWRENCE (voice-over): Behind every Hellfire missile there's an actual human being, someone back at base remotely pulling the trigger. But the Pentagon is preparing for the day when robots are capable of killing on their own.

UNIDENTIFIED MALE: The machines, they're starting to take over.

LAWRENCE: It conjures up images of "The Terminator."

UNIDENTIFIED MALE: Mr. Chairman, I need to make myself very clear, if we uplink now, Skynet will be in control of your military.

UNIDENTIFIED MALE: But you'll be in control of Skynet, right?

LAWRENCE: The Pentagon just issued its first directive on autonomous weapons, effectively forbidding the development of lethal weapons with no human control. To minimize failures that could lead to unintended engagements.

DAVE OCHMANEK, DEPUTY ASSISTANT DEFENSE SECRETARY: That's a sterile term for meaning harming innocents, killing the wrong target.

LAWRENCE: The Pentagon's Dave Ochmanek admits these weapons are still 20, 30 years away.

(On camera): That technology doesn't exist yet. So why now?

OCHMANEK: The thought was technology is dynamic. And we'd like to get out ahead of it.

LAWRENCE (voice-over): Just this week the Navy tested its next generation drone, which could carry bombs and land on an aircraft carrier with hardly any human control. The directive only applies to lethal systems and still allows the military to develop autonomous spy planes.

OCHMANEK: As we begin to approach the possibility of having machines select and engage targets, we want to be very careful not to cross that line without high-level policy review.

LAWRENCE: Human Rights Watch applauds the Pentagon's move.

UNIDENTIFIED FEMALE: We don't believe it solves the problem, however.

LAWRENCE: So the group is calling for governments to ban autonomous weapons outright. Bunny (INAUDIBLE) points to Syria and wonders what killer robots could do in a conflict like that.

UNIDENTIFIED FEMALE: Because the weapons are emotionless, they can actually serve as a perfect tool for a dictator who would not have to worry about the danger of a human soldier turning on him if fired -- if ordered to fire on his own civilians, a robot would not do that.


LAWRENCE: A lot of ethical questions there. In fact the Pentagon officials tell us that the reason they put this out now was to sort of head off the developers. They know that if the weapons developers develop this technology ahead of time, it's hard for any institution not to use technology that's out there and available, so the message to the developers is don't build these autonomous systems that can kill without some sort of human control built into the design.

JOHNS: But do you actually think they'll heed the message?

LAWRENCE: Well, the Pentagon is basically saying don't build it like this because we're not going to buy it, and money is always a very big financial incentive, Joe, but I got to tell you, I mean, the way technology is going, it's hard not to see a day when this technology isn't out there in some shape or form.

JOHNS: Chris Lawrence at the Pentagon, thank you for that.


JOHNS: The ancient Mayan calendar ends on December 21st. And some people think that means the end of the world is just weeks away. We'll show you how NASA is trying to debunk the myth.


BRUNO SERATO, CNN HERO: Who likes pasta?

ANDERSON COOPER, CNN ANCHOR: Every night, Chef Bruno Serato serves free meals to 300 motel kids in Anaheim, California. His work that he was honored for last year as a "Top 10 CNN Hero."

SERATO: It was the most amazing moment in my life. After the CNN show, a lot of people called me, what can we do for you?

COOPER: But it was Bruno who wanted to do more to help families living in area motels.

SERATO: When I send the kids back to the motel, I always feel a very sad moment because I know we have to go back.

UNIDENTIFIED FEMALE: Now you guys can all share those markers. Stay right here and color.

COOPER: It's a hard life to escape. Just ask the Gutierrez family, who lived in a motel with their five children for more than a year. UNIDENTIFIED FEMALE: This is our living room/bedroom. Me and my husband sleep right here. And then the rest of them sleep sardine- style on this bed. He got laid off, and I started working just a month ago. It's really very hard for us to save up to get into an actual home.

SERATO: I came over to say, let's pay the first and last month.

COOPER: By providing rent and a deposit, Bruno now helps families leave the motel life behind for good. Working with a local nonprofit, 22 families have now gotten a fresh start in a home of their own.


UNIDENTIFIED FEMALE: The kids just run around, explore, found their room.

SERATO: This is yours?

UNIDENTIFIED MALE: This is -- yes, mine.

SERATO: Congratulations.


SERATO: My heart is really full of joy. We're putting back people to their own home.

COOPER: Bruno hopes to move 70 more families by the end of next year. A CNN hero with a new recipe for helping others.

SERATO: Pasta.



JOHNS: A prediction with origins in the Mayan civilization has some people convinced the world is about to end.

CNN's Lisa Sylvester is here to tell us how NASA is responding -- Lisa.

LISA SYLVESTER, CNN CORRESPONDENT: Hi, Joe. You know, things have a way of going viral on the Internet. And one of those is a rumor that the world is going to end next month. That is based on the Mayan calendar. But NASA says all of that is just a bunch of hooey.


SYLVESTER (voice-over): Steve Pace has been prepping for the end of the world for years.

STEVE PACE, PREPARING FOR DOOMSDAY: I foresee the potential for a disaster that's catastrophic. SYLVESTER: CNN caught up with him in 2009 as he prepared with food, weapons, even anti-radiation pills, all for this year, 2012.

PACE: I'm talking about collapse of civilization.

SYLVESTER: Pace is among the doomsdayers worried that December 21st, 2012, will be the last. That's the day when the ancient Mayan calendar is said to end.


SYLVESTER: But that talk of the end of the world, sheer nonsense, says top scientists. In this YouTube video that NASA put out experts explain why it's just another day. Their scientists take all of the rumors one by one and debunk them.

Among the theories is that a large planet, known as Niburu, will have a close encounter with earth, wreaking all kinds of havoc.

YEOMANS: So this enormous planet is supposed to be coming towards earth, but if it were we would have seen it long ago, and if it were invisible somehow, we would have see the effects of this planet on the neighbors planets.

SYLVESTER: Thousands of astronomers, experts and novice, see nothing of the sort. Another theory is that the planets will somehow align, causing devastating tidal waves. Two problems there. There is no planetary alignment taking place and even if it were, only the moon and sun could have an effect on tides on the earth says NASA.

Experts have also dismissed other theories like the shifting of the earth's magnetic poles, or solar storms.

To some it may all sound like fantasy, but there are quite a few people who are really afraid. Mostly because for the past several years the Internet has been abuzz with talk of the world ending on December 21st, 2012.

David Morrison, senior scientist at the NASA Astrobiology Institute, says he has been inundated with e-mails, including a message from two parents who said they were planning on killing their children and themselves ahead of the day.

DAVID MORRISON, NASA SENIOR SCIENTIST: I have received thousands of e-mails that were sent to NASA's Web site asking astrologists, asking about all aspects of this strange 2012 doomsday hoax. Including many children who are really scared who say they can't sleep, they can't eat, some have even said they're contemplating suicide.

SYLVESTER: Morrison has put out a doomsday 2012 fact sheet. He says he's looking forward to December 22nd, the day after so that the world can get on with their lives and children can look forward to something else. Christmas.


SYLVESTER: Mayan experts have also weighed in saying, look, the calendar doesn't end end, that is like ending our year on December 31st, well, then we have a new year that starts the very next day -- Joe.

JOHNS: Thanks for that, Lisa.

Nebrew (ph), never heard that one.