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NYC Police Have Stepped Up Times Square Security; President Obama Under Pressure to Take Tougher Stance Against Russian Hacks; Potential New Hacking Attempt from Russia in Vermont. Aired 3-4p ET

Aired December 31, 2016 - 15:00   ET



[15:00:00] JEAN CASAREZ, CNN CORRESPONDENT: In an interview with, one Rockettes spoke out about the decision. The majority of us said no immediately. There there's the percentage that said yes for whatever reason. The dancers union ultimately deciding that participation in the inauguration will be voluntary. Madison Square Garden which employs the dancers adding we had more Rockettes request to participate than we have slots available.

BORIS EPSHTEYN, DIRECTOR OF COMMUNICATIONS, PRESIDENTIAL INAUGURATION COMMITTEE: It is not about the big names, it is about the American people. And that's who will be represented all over this inaugural. We have such an outpouring of support of positivity from all over this country. It has been truly humbling.

CASAREZ: Jean Casarez, CNN, New York.


FREDRICKA WHITFIELD, CNN ANCHOR: All right. Thank you so much for being with me today. Have a great new year's celebration. I'm Fredricka Whitfield.

The next hour of the "CNN NEWSROOM" starts right now with Suzanne Malveaux in Washington.

[15:00:59] SUZANNE MALVEAUX, CNN HOST: Top of the hour. I'm Suzanne Malveaux in Washington in for Poppy Harlow. You are in the CNN NEWSROOM. Welcome.

You are looking at live pictures now right of Dubai. This is where fireworks are ringing in the New Year already. Coming up, we are going to take you live to Times Square in New York City where, of course, as expected, security is tight and the party people, well, they are already ling up.

But first, we want to begin with a potential new hacking attempt from Russia, this time against an electric company in Vermont. This is Burlington electric that we are talking about says that malicious malware has been discovered on one of its laptops and U.S. authorities believe that it is the same malware that Russian hackers used to meddle in the presidential election. Vermont's governor Peter Shumlin already taking a hardline stand

saying in a statement quote "Vermonters and all Americans should be both alarmed and outraged that one of the world's leading thugs, Vladimir Putin, has been attempting to hack our electric grid. The episode should highlight the urgent need for our federal government to vigorously pursue and put an end to this sort of Russian meddling."

That strong condemnation comes as the president-elect offers anything but. Instead, Donald Trump's relationship with Russian leader Vladimir Putin appears to only be growing friendlier with Trump praising Putin's response to new U.S. sanction. Trump tweeting, great move on delay by V. Putin. I always knew he was very smart.

I want to bring in our Polo Sandoval. He is following all the quickly developing time in the story.

And Polo, first of all, U.S. officials believe that Russia is behind this new intrusion. Why? What is the proof?

POLO SANDOVAL, CNN NATIONAL CORRESPONDENT: Well, Suzanne, there is at least one reason for U.S. officials to suspect Russian involvement in this latest cyber-threat. That's because Burlington electric, the utility company that has caught in the middle of all of this right now, they are reporting that they discovered what is commonly described or called grizzly step as U.S. official on one of their company laptop computers. So that sounds familiar. That's because that malware code that was supposedly used by Russian hackers during the DNC hack during the November election.

Official (INAUDIBLE), the company say that that's laptop was hooked in or not connected directly to the power grid. So they believe the power grid, that their customer's information was not compromised. That's according to this electric company. But nonetheless, this is really begging a closer look. That's because this was initially discovered after the Obama administration and the department of homeland security had issued an advisory, a warning for several of these kinds of companies. Not just utilities companies but other entities as well, to take a closer look at their network and try to discover any potential vulnerabilities.

But this is leading to serious questions here, Suzanne. who is involved. My colleague, Jim Sciutto, spoke to one government official who says, it is still too early to determine what the scope and also what the intent is. And also, another key question, Suzanne, was this an isolated incident?

MALVEAUX: All Right. Polo, thank you so much.

We want to get straight to Moscow for the reaction there. Our senior international correspondent, Matthew Chance, is joining us live.

So Matthew, first of all, can we talk about that? Do we think this is an isolated incident? Do we think that this is, in fact, related or connected to the Kremlin? And what is their reaction to this?

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: First of all, there has been no reaction to it here. I mean, it has been the New Year holiday, obviously. And everyone has gone absolutely quiet, particularly after the flurry of diplomatic activity and speeches that we saw over the past couple of hours with the exception, of course, of the Vladimir Putin's speech. Whether it is connected with the Russians, well, U.S. intelligence believe this type of software is connected with the Russians. If is from the basis of their assessment that Russia was involved in the hacking of the Democratic institutions. That this institutions inside the United States as well. And so I'm sure that same analysis stands for this, which is why we are talking about this.

And so, yes, you know, obviously, this is going to complicate the situation for Donald Trump potentially. I think that's one of the consequence from Russian point of view on this. It is going to complicate the situation for Donald Trump because obviously he wants to take office and he wants build bridges with Russia. It is something that Vladimir Putin, the Russian president, wants very much as well. Obviously, Donald Trump faces a lot of headwinds in the United States who are ready from within his own party, the Republicans, also and from within Congress in general. And this suspected Russian hacking through this electricity company is going to make that process of changing U.S. policy towards Russia even more difficult for Donald Trump.

[15:05:35] MALVEAUX: And Matthew, thank you so much.

Obviously, the Republicans on the hill believe that further sanctions against Russia are necessary. They are going to have the hearings in the comings weeks. And so far, president-elect Donald Trump has not responded specifically to this new threat implicating Russia. But Trump has been dismissive of previous reports of Russian hacking insisting that just as sweet that the U.S. quote "should move on."

Our Ryan Nobles, he is in Washington with more on that.

So Ryan, let's talk about this latest threat has nothing to do with the election but certainly with the U.S. infrastructure. I would imagine there is a lot of concern from the administration about that. And do we expect that Washington officials think that Trump might take a tougher stand learning more about this latest hack and that it is, in fact, connected potentially could impact a power grid, electricity, in very important place.

RYAN NOBLES, CNN NATIONAL CORRESPONDENT: Well, there is no doubt, Suzanne, that that is going to raise some new questions. Obviously up until this point, the alleged Russian hacking was just connected to the election. And that was something that Donald Trump did not want to bring any attention to. He did not even want to open the door to the idea that perhaps his election victory was tainted in some way by the Russian government.

But there has been no indication at this point that Donald Trump is going to change his position when it comes to Russian attempts to get involved in the United States in many different ways. Because as you said, he has been so complimentary of Russia and its president, Vladimir Putin, in particular. As you pointed out, just releasing a statement a couple of days ago where he suggested that we needed to move on from this particular topic.

Now, Trump has said repeatedly that he would like a warmer relation with the Russian government. He said that often on the campaign trail. We are going to have to wait and see if this changes the dynamic a bit. Because as you mentioned, we are not just talking about an election now, something that is in the past. We are talking about a potential threat in the future. We know that the president- elect is going to meet with some of these top intelligence officials later this week. That's where we should expect some pointed questions about this new information, whether or not it leads to some sort of pointed public statement by the president-elect as it relates to Russia. We are going to have to wait and see -- Suzanne.

MALVEAUX: And Ryan, I wonder, too, if Trump will be paying attention to Senator John McCain's hearing for this holding this week over the Russian hacking and how it impacted the election. Do we expect that he is actually going to be paying attention to that? Some of the conclusions that come out of that separate from his own personal briefing.

NOBLES: Well, it is going to be difficult to ignore it, Suzanne. This is going to be a very public hearing by John McCain's committee, the Senate armed services committee. One of the interesting points about this particular hearing is that it will be with the new Congress that will only been sworn in three days before when it actually takes place.

And there are going to be some important people there. James Clapper, who is, of course, the director of national intelligence, will be speaking as well Mike Rogers, who is the director of the national security agency.

So this is going to be an opportunity for members of Congress to ask very pointed questions about this controversy. A lot of it has been done through leaked reports in the media. We haven't actually heard from the intelligence officials themselves. And you know, members of Trump's administration, his transition have said, why doesn't the intelligence committee come forward with concrete evidence that links Russia to this alleged hack? Perhaps those are the questions that we are going to hear later this week when that hearing takes place.

MALVEAUX: And the irony, Ryan, is that Donald Trump is going to get more of those details and more information in his private briefing than we are going to hear in public with senators McCain and members of Congress. So it will be interesting to see how Trump reacts to that because he really essentially will have more information than the rest of us, all of us because it is so public in that hearing.

Ryan, thank you so much. I appreciate your perspective.

We are also looking ahead this hour. It is a cat and mouse game between Russia and the United States. But are things going to change when Trump becomes president? We are going to talk to the former director of the CIA.

And plus, it is no secret that Russian spies, well, they infiltrated American society. But what's the end game here? An inside look into the spies among us.

And next, live to Times Square in New York where a 16-ton garbage trucks, that's right, garbage trucks, well, they are going to help keep people safe. We are going to explain how.

You are live in the CNN NEWSROOM.


[15:12:37] MALVEAUX: Countdown is on to midnight for this New Year's Eve. Police in New York City now have stepped up security efforts in Times Square for the iconic ball drop. We will all be watching. But official stress, this is all precautionary, because they haven't gotten any credible threats.

Joining us now from Times Square right below where that big ball is going to drop, our own Jessica Schneider.

So, tell us how the recent terror attacks in Europe, how are they informing the security efforts here in the United States and specifically where you are, where there are so many people who want to party.

JESSICA SCHNEIDER, CNN CORRESPONDENT: Yes, that's right. A lot of people who want to party, Suzanne. And that's why the NYPD has enacted enhanced security measures for the two million people who are expected here.

You can take a look around. And you can see all of these barricades. That is just one of the many security measures here. Everyone who comes in here, their bags are searched. They are also wanted. They go through security screening. And in addition to that, the NYPD new this year has enacted 65 sanitation trucks that will be on the perimeter of Times Square. They extend over to 8th avenue. They will be filled with sand. And those act as protective barriers to prevent any sort of attack that could occur.

Of course, there is no credible threat to Times Square and New York City. The NYPD has stressed that. These are all precautions. Also, about 100 other protective vehicles will be out here and 7,000 NYPD officers will be all throughout this city.

But of course, the important part out here, they are the crowds out here. They have been gathered and lining up all morning long. In fact, we have Jamie, Jennifer and Pam. Did I get that right? From Mississippi. They have been here very early. What time did you guys get here to get these spots?

UNIDENTIFIED FEMALE: 10:30 this morning. We did. We got here out of the hotel about 10:30.

SCHNEIDER: So a long day for you guys. More than 12 hours.

And here is the mom. Now, was this on the bucket list or did your daughters have to convince you?

UNIDENTIFIED FEMALE: No. This was definitely on the bucket list. And this is their Christmas present.

SCHNEIDER: That's so great. Now, how have you been faring? Because it has been about five hours now with a lot more to go.

UNIDENTIFIED FEMALE: We are just hanging out, watching the people and loving every minute of it.

SCHNEIDER: Excellent. And you know, that's kind of the atmosphere that you get out here. People are cold. People have been out here a while. But everyone is happy about it. So they have all gone through the security measures. And it is amazing, in fact. The ball drops down there, 42nd street. And the crowds extend all the way to 59th street. They are in these protective pens. They are not allowed to leave. Once they are in, they have to stay here. So these guys are hearty troops. But you guys are ready for it, right?

And you know, Suzanne, my favorite part of Times Square or New Year's Eve I should say in Times Square are the glasses. These are my favorite part. I get them every year.

So Happy New Year.

[15:15:19] MALVEAUX: That's awesome. Love the glasses there. It is great. That's a bucket list item. You know, everybody has to do it at least once in their life if they can.


MALVEAUX: So you know, all those folks are out there. They are out there kind of early, I think. But given all that security, those long lines, how late could somebody arrive for tonight if they wanted to enjoy it and still get in.

SCHNEIDER: Well, people are still trickling in here. But I want to give you a look. So that's the ball down there. If you go this way, I mean, it extends for about ten more blocks. And I have actually been out here once. It was many years ago. I got here as late as 9:00. But you know, if you want a prime spot, you probably have to come in the next hour or two. But I think if you want to get around the perimeter, you can get here a little bit later. But these people, they have been camped out for hours now. People lining up as early as 7:00, 8:00 a.m. I talked to one group from Florida. They were here at 7:00 a.m.

So if you want to get here, you should probably get here very soon. Because things are very tightening up and closing up for that big show at midnight -- Suzanne.

MALVEAUX: How cold is it out there, Jessica? I see you are all bundled up. Is it freezing? How are you doing?

SCHNEIDER: Yes. You know what? It is not bad. And it could be a lot worse. So could be rain. But I think it is about 42 degrees out here right now. So that's actually pretty good. There is a bit of wind, a bit of a chill. But it is amazing how hearty these people are. I'm a bit chilly. But they are the ones standing here, so. MALVEAUX: All right. Well, hang in there. We will be with you every

hour. It should be pretty awesome.

Thanks again, Jessica. I appreciate it.

And of course, don't forget this New Year's Eve expect the unexpected, of course, with Anderson Cooper and Kathy Griffin. That's right. New Year's Eve live beginning tonight at 8:00 eastern on CNN.

And let's take a live look at Baghdad, live New Year's pictures. We are back in a moment.


[15:19:53] MALVEAUX: Surprising twist in the controversy over Israeli settlements and the fall out between the Obama White House and Israeli prime minister Benjamin Netanyahu.

Britain's Prime Minister Theresa May criticized secretary state John Kerry's speech defending the U.S. to abstain from a vote and not veto this U.S. resolution condemning Israeli settlements in the west bank in East Jerusalem. Well, Kerry called Netanyahu's government the most right wing coalition in Israeli history.

I want to bring in our Sara Sidner who is joining us now from Jerusalem.

And Sara, let's talk about this because Britain approved the U.N. Security Council resolution. So explain to us why it was that the prime minister panned Kerry's speech.

[15:20:36] SARA SIDNER, CNN CORRESPONDENT: There have been a lot of speculations about exactly why she did it, whether she is to cozy up to the next U.S. administration or not.

But I want to give you an idea of what she said and then how the state department responded, essentially Kerry responded. Here is what British Prime Minister Theresa May said. And you just mentioned, Britain voted for U.N. resolution 2334 while the United States abstained. But here is what she said.

We do not believe that the way to negotiate peace is by focusing on only one issue, in this case the construction of settlement, when clearly the conflict between the Israelis and Palestinians is so deep. And we do not believe that it is appropriate to attack the composition of the democratically-elected government of an ally.

That is after John Kerry had said this is the most right wing leaning government that Israel has ever had talking about Netanyahu's government and the coalition that supported him.

Now, the response to that was interesting because the state department did respond with surprise, mind you, stating that, look, you also voted for this resolution. This is nothing new for Britain, talking about settlement, and that they are an impediment to peace. Here is what the state department said. We are surprised by the UK

prime minister's office statement given that Secretary Kerry's remarks which covered the full range of threats to a two-stage solution including terrorism, violence, incitements and settlement were in line with the UK's own understanding of the policy.

What you are seeing here is more fallout, though. Because the fallout started with the United States' deciding not to abstain basically from the vote, allowing this resolution to go forward. And that really angered Israel and its leadership, particularly Benjamin Netanyahu who was furious over this. And he made some pretty strong statements to some of the other countries as well, basically saying to New Zealand if you vote for this, this is considered an act of war. So think about extremely tense here.

But ultimately, Suzanne, you know this as well as anyone, the relationship between the United States and Israel and Britain, for that matter, is very strong. They are very strong allies no matter what you are sort of hearing from each of the leaders of these countries right now - Suzanne.

MALVEAUX: All right. Sara Sidner, thank you so much. Appreciate it.

And Sara is right, many people have tried but they have fail to bring peace between the Israelis and the Palestinians. Very complicated issues. But this is turn President-elect Trump says that he is going to solve the problem by making what he calls the ultimate deal. But what are the chances that he will actually succeed?

Our Oren Lieberman, he is reporting the incoming Trump administration is being closely watched from Jerusalem.


OREN LIEBERMAN, CNN CORRESPONDENT (voice-over): A new political day dawn on the Middle East on January 20th.

DONALD TRUMP, PRESIDENT-ELECT OF THE UNITED STATES: Very, very strong initiative. I think Israel has been treated very, very unfairly by a lot of different people.

LIEBERMAN: President-elect Donald Trump says he can do what no president has done in half a century, solve the Israeli/Palestinian conflict calling it the ultimate deal and suggesting his Jewish son- in-law, Jared Kushner, may be part of the plan. Trump tweeting the recent U.N. resolution on Israeli settlements was a big loss for Israel and will make it harder to negotiate peace but saying he will get it done anyway.

The president-elect has promised to move the U.S. embassy from Tel- Aviv to Jerusalem and recognize the holy city as the capital of Israel. The moved welcomed by Israel, condemned by the Palestinians as the death of a two-states solution.

The unprecedented intervention from the president-elect coming as relations between Prime Minister Benjamin Netanyahu and President Barack Obama are as bad as ever. The Obama administration led talks between Israelis and Palestinians in 2010 and again in 2013. The last round of negotiations led by secretary of state John Kerry broke down with both sides blaming each other. Two months later, Israel and Gaza were at war.

Tensions have only worsen since then as the region descended into another round of violence late last year. Prime Minister Netanyahu and Palestinian president Mahmoud Abbas (INAUDIBLE) in September at the funeral for Israeli president Shimon Perez who shared a Nobel Prize for forging peace deal between Israelis and Palestinians.

It was the closest Abbas and Netanyahu had come to talking publicly in years. In time, we will find out if president-elect Trump can change that.

President-elect Donald Trump brings an outsiders perspective to the Israeli/Palestinian conflict, that of a businessman, not a politician. And maybe, just maybe, that's exactly what the conflict needs.

But presidents who have handled or worked on the conflict have done so generally with more sensitivity than Trump has shown. Either way, Trump will have his chance in just under three weeks.

Oren Lieberman, CNN, Jerusalem.


[15:25:26] MALVEAUX: And still to come, they pose as every day Americans. But don't be fooled.


UNIDENTIFIED MALE: What they do is more than just collect, they actually try to influence events to the benefit of Russia all over the world. And this is something that they have done for decades.


MALVEAUX: Russian spies, hard at work in the United States. But as we will see the U.S. also plays the spy game.

You are live in the CNN NEWSROOM.


[15:29:02] MALVEAUX: President-elect Donald Trump's enthusiastic praise for Russia's president Vladimir Putin, a long-time U.S. adversary, is irritating some Republicans who believe that Russia needs to be punished even more for its attempt to meddle in the U.S. election. Trump's latest shout out came after Putin decided to not retaliate against the U.S. for sanctions that Obama unveiled.

Trump tweeting here, great move delay by V. Putin. I always knew he was very smart.

Republican senator John McCain is now outraged. (BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: When you attack a country, it is an act of war. And so, we have to make sure that there is a price to pay so that we can perhaps persuade the Russians to stop this kind of attacks on our very fundamentals of democracy.


MALVEAUX: Let's talk more about this, unpack this with ambassador, James Woolsey. He is former CIA director under President Clinton, a lifelong Democrat who has served as senior adviser to Trump's campaign.

Ambassador, can you hear me? Ambassador, can you hear me?


MALVEAUX: Hello. Ambassador, this is Suzanne Malveaux. Can you hear me?

WOOLSEY: Her voice is very faint.

MALVEAUX: OK. I think we are going to take a break. We are going to take a quick break. We are having some sound problem with the ambassador. We are going to get right to him after the break. We will correct that and see you on the other side.


[15:33:36] MALVEAUX: Want to bring back ambassador, James Woolsey. He is a former CIA director under President Clinton. A lifelong Democrat who also served as senior adviser to Trump's campaign.

Ambassador, I apologize for the sound issue, the problem there. If you can hear us, of course, I want to talk - let's talk about Trump's long-term strategy regarding Putin. We have heard so many statements from Trump saying that he does not believe in the intelligence, the U.S. intelligence that has been presented to him so far, that Russia was behind the hacking that potentially influenced the election. You have spoken with him and you spoke with the transition team. What is behind the skepticism?

WOOLSEY: I don't know. I think there was some questions. Certainly, the FBI was on one side, the CIA on the other and so forth, with respect to that hacking. But I don't think these same questions are going to arise with the recent hacking of the system in Vermont, the utility. That looks very troubling to me. I have been studying and working on this issue for 10 or 12 years now. And I don't think the same kind of questioning is going to come up because of the nature of the hardware or software that they have found. And that is extremely dangerous. The Russians have hacked successfully into Ukraine's electric grid and to Georgia's electric grid. And this is some of the same software and hardware that they used in those hackings. And the grid isn't just a matter of convenience. It's a front on

which one can conduct a symmetric warfare and the Russians like that in a symmetric warfare and they are doing it. And that means if you take down the electricity part of the infrastructure, you have taken down a lot of the rest, too -- water purification, food deliveries and so on. This is a very big deal and ought to be treated as such.

[15:35:46] MALVEAUX: Ambassador, a couple questions, of course, following up on that is how close did they get to disrupting the electric grid. I know that it was not actually connected to the electric grid. So you say, this is very dangerous. Do you see the potential for them actually disrupting the electricity, the power system in our country, first of all, that Russia could do that? And secondly, do you think in light of that that Donald Trump will take this more seriously than he has the hacking of the election?

WOOLSEY: I'm not going to speak for him but it is a different issue than what we were facing back with respect to the Republicans and Democrats and getting emails and so forth. This is a world class problem with respect to the grid.

Part of the problem is that the electric companies have not been helpful on this. Their lobbyists have worked hard to keep us from doing a lot of what is necessary in fixing the grid. And the vulnerabilities are substantial. And this is some of the same type of software and hardware that was used against Ukraine.

So this is a wakeup call. And people should treat it as such, not as a political issue involving children's parties at the Kremlin or any of that. That's way down the list of importance.

MALVEAUX: Will you make that message clear to Donald Trump? You have his ear or at least you have the ear of his transition team. Will you tell him that look, this is very different. This is very serious than some of the intelligence that he has dismissed over the elections?

WOOLSEY: I have worked for four president, two Republicans, two Democrats. I have never told anybody what I say to them or what they say to me. So what I will say is that my view, and I will express it to anyone that wants to hear it is that this is an extremely dangerous and difficult situation and we have to go to general quarters, as they would say in the Navy, right away and get the resilience of our electric grid, specially, fixed. And it needs - it requires presidential leadership. President Obama has given zero leadership on this issue for the last eight years. This would be something that any president would need to focus on.

MALVEAUX: I want to ask this specific question and then we will move on here. What can president-elect Donald Trump do? You said that the electric companies have resisted this kind of -- those safeguard that are put in place. Can he force that? Is that something that can be done through executive orders or is that something that has to go through Congress?

WOOLSEY: There is legislation pending that several leading members of the Congress have pushed and that has only one bill has passed. There is a lot more to do. There are several very able congressmen and senators who have this issue in their sights and have been working to try to get the legislative authorities changed so that we can take action. But so far, only one bill has passed and it makes a start but it is not nearly enough.

MALVEAUX: Let's talk a little bit about Trump and some of his statements here. I want to read a tweet. This is from a former CIA analyst (INAUDIBLE) who says that as a CIA officer, if I had a colleague talking like Trump is about Putin, I would think he was turned.

Ambassador, I mean, if you heard somebody in the CIA, an officer perhaps, lavishing praise on Putin in a similar fashion that Trump has, would that raise eyebrows? Would you suspect or believe that there was something that was suspicious about that? I mean, what would be your reaction?

WOOLSEY: It depends on what the Russians are doing. I have negotiated with them in four sets of negotiations from 1968 through 1991. And on three of those negotiations, they were stubborn, they were cantankerous. They were not yielding. They did not work effectively toward a reasonable agreement on nuclear weapons full stop.

I had a negotiation with them in 1989, 1990, 1991, on conventional armed forces. They worked carefully with us. They were thorough. They were reasonable. They negotiated tit for tat and we made compromises. We worked out what I think was a very fine treaty that's now been cater-manded (ph) by Mr. Putin.

But anyone who had talked to me during those three years I was negotiating with then still soviets, and I would have said something very much like what Donald Trump has said, which is that we are working with them well. Things are going well, et cetera.

So it depends on what the Russians are doing. They can either behave reasonably and give us all a reason to want to work with them or they can behave unreasonably such as by using cyberwar to attack our electric grid.

[15:40:48] MALVEAUX: Well, the last thing that Putin has done is that, of course, he says he is going to delay any kind of response regarding Obama's sanctions here. But there are other intelligence analysts who say they believe that he is not, you know, he is trying to pretend he is Santa Claus here but at the same time he really - he didn't expel those U.S. spies in Russia, because it would be a lot of work to expel them. That they already know pretty much where they go, what they do, what kind of conversations they have, what they are eating.

If you got rid of them in retaliation, they would have to start all over with another group of American spies. So that this is a very unique and smart strategy on Putin's part, that he is really playing Trump. Do you think that's true?

WOOLSEY: I think it is shrewd on his part but not particularly for that reason. I think the main thing by inviting American children to the party in the Kremlin, by not requiring a withdrawal of some 35 Americans from Russia and so forth, I think he is attempting to look very reasonable and like someone you can work with, et cetera.

There may be an element of truth in some aspects of that. But mainly, I think he is being quite clever. And he is playing chess and we look like we are still sitting there trying to play checkers.

MALVEAUX: Thanks you so much, ambassador for your analysis. Really appreciate it. James Woolsey.

WOOLSEY: Good to be with you.

MALVEAUX: Thank you. Have a good holiday.

WOOLSEY: Thank you.

MALVEAUX: Coming up, the governor of Vermont, he is not mincing any words, calling Russian president, Vladimir Putin quote "one of the world's leading thugs." So how much pressure is President Obama under to take a tougher stance against Russian hacks? We're going to take you live to Honolulu up next.


[15:45:32] MALVEAUX: It's the big story we are following today. An electric company in Vermont alerting federal officials now that it found malicious malware, this is in one of its computers and it is the same malware that Russian hackers used to meddle in the election. The discovery comes just one day after President Obama announced brand new sanctions against Russia and while Republicans in Congress are fully supporting the sanctions. The president-elect's team, well, they are now calling foul. They insist that the sanctions are nothing more than a way to box in Donald Trump.

I want to bring in our Athena Jones who is in Honolulu where the president is spending the holidays.

Athena, good to see you. Obama, he has just three weeks left in the White House now. What more could we expect from President Obama regarding the hacking?

ATHENA JONES, CNN CORRESPONDENT: Well, we know, Suzanne, when the White House announced the steps it was taking publicly, this public announcement of sanctions. They also said there will be other steps. The announced moves are not the sum total of our response. So we expect there are going to be covert, actions taking place, things that won't be announced, things we might not ever hear about.

One more thing that will happen publicly is remember the review the president has asked for. He has asked his intelligence community to put together, not only into this latest hacking by Russia into this election but also previous militia cyber-activity affecting previous elections. We expect that report to come out and be presented to Congress before the president leaves office -- Suzanne.

MALVEAUX: All right. Athena, it looks gorgeous out there. Happy holidays to you.

All right. For decades, they have been planted all around us, Russian spies. The goal to influence events in order to benefit Russia.

Well, our CNN Pentagon correspondent, Barbara Starr, is taking a closer look.


BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): FBI cameras captured Russian operative, Anna Chapman and a federal undercover agent meeting a New York coffee shop in June, 2010. Seventeen days later, Chapman and nine other Russian sleeper agents were arrested in New York, New Jersey, and Virginia, charged with conspiracy to act as unlawful agents of Russia, spies who had burrowed deep in American society for years trying to steal secrets and recruit agents.


STARR: The FBI had watched Chapman them for months recording drop- offs of packages, meetings on staircases. Even one meeting just yards from CNN's offices in New York. The U.S. believes the group never got its hands on classified information. But the Russian infiltration into the U.S., a classic Moscow move.

STEVE HALL, FORMER CIA OFFICER: What they do is more than just collect. They actually try to influence events to the benefit of Russia all over the world. And this is something they have done for decades.

STARR: Within days at the airport in Vienna, an elaborately choreographed transfer. The ten Russians traded back for four other Russians charged with being in touch with western intelligence services. Now, the state department is expelling 35 Russian officials it says violated their diplomatic status. This, after the U.S. claim of interference in the presidential election and harassment of U.S. diplomats overseas.

Vladimir Putin, of course, a former Russian intelligence officer, well acquainted with the so-called illegals programs, putting agents into U.S. society.

HALL: The fact that they would continue to do that to establish these American legends and cover stories for these people that are trying to pose as Americans in the United States shows how serious they are.

STARR: But the U.S. has also been caught in the act. In 2013, Ryan Fogle, a political secretary at the U.S. embassy in Moscow, was arrested. The Russians claimed they caught him with wigs, dark glasses and cash trying to recruit a Russian agent. Fogle was expelled. It was never clear if he was set up by the Russians. Earlier this year, a U.S. diplomat was tackled and beaten by a uniformed Russian officer as he tried to enter the American embassy in Moscow.

JOHN KIRBY, STATE DEPARTMENT SPOKESMAN: The action was unprovoked and it endangered the safety of our employees.

STARR: And in that way, the U.S. wound up expelling two Russian diplomats. This type of cat and mouse spy activity has been immortalize in TV and movies for years. But the reality can be vicious and very dangerous.

Barbara Starr, CNN, the Pentagon.


[15:50:13] MALVEAUX: All right. Stop me if you've heard any of these before --



TRUMP: David Duke endorsed me? OK. All right. I disavow. OK?



MALVEAUX: Those are just some of the phrases that made political headlines this year. Ahead we are going to take a look at the top ten political stories of 2016.

You are live in the CNN NEWSROOM.


[15:53:34] MALVEAUX: 2016 will be remembered as the start of a whole new political era in the United States. It brought out the good, the bad, the downright nasty. So what will we remember most?

Our CNN's Jake Tapper counts down the top ten political stories of 2016.


JAKE TAPPER, CNN CHIEF WASHINGTON CORRESPONDENT: This year everything we thought we knew about politics was turned on its head. Political attacks, email hacks and several cracks in the glass ceiling made for an unparalleled race between the first female major party nominee and a billionaire political outsider.

President-elect Trump will soon take office, but first let's look back at our top ten political stories of 2016.

Number ten, conservative Supreme Court justice Antonin Scalia died suddenly in February.

REP. PAUL RYAN (R), HOUSE SPEAKER: Everything is on the line.

TAPPER: And in an unprecedented move Republicans vowed to block any high court appointments until after the presidential election.

JOE BIDEN, FORMER VICE PRESIDENT OF THE UNITED STATES: Simply to turn your back before the president even names a nominee is not an option the constitution leaves open.

TAPPER: Judge Merrick Garland was nominated in March but never even had a hearing.

Number nine --

B. OBAMA: You want to give me a good sendoff? Go vote.

TAPPER: In their final presidential year, the Obamas hit the campaign trail.

M. OBAMA: When they go low, we go high.

TAPPER: With more catch phrases.

[15:55:02] B. OBAMA: Come on, man.

TAPPER: And less restraint.

B. OBAMA: Donald Trump is uniquely unqualified to be president.

TAPPER: But a different tone after the Democratic defeat.

B. OBAMA: If you succeed then the country succeeds.

TAPPER: Number eight.

TRUMP: I beat everybody. I beat the hell out of them.

TAPPER: Donald Trump won the Republican nomination but struggled to win over the party. Republican leaders distanced themselves.

Will you support him?

RYAN: I'm just not ready to do that.

TAPPER: But will the party now unify around president Trump?

RYAN: We are going to hit the ground running.

TAPPER: Number seven, Trump's unvarnished campaign attracted extremist support.

TRUMP: I don't know anything about what you are even talking about with white supremacy.

TAPPER: He was slow to denounce white supremacists.

TRUMP: David Duke endorsed me. OK. All right. I disavow. OK?

TAPPER: And his controversial rhetoric on race continued.

TRUMP: This judge is of Mexican heritage. I'm building a wall.

TAPPER: Even targeting the judge in his university fraud case.

If you are saying he can't do his job because of his race, is that not the definition of racism?

TRUMP: No, I don't think so at all.

TAPPER: Number six, the conventions.

HILLARY CLINTON (D), FORMER PRESIDENTIAL CANDIDATE: The first time that a major party has nominated a woman for president.

TAPPER: Hillary Clinton made history in Philadelphia and a gold star family made Trump an offer.

KHAZI KHAN, GOLD START FATHER: Have you even read the United States constitution? I will gladly lend you my copy.

TAPPER: In Cleveland, Melania Trump's speech was familiar.

M. OBAMA: You work hard for what you want in life.

MELANIA TRUMP, DONALD TRUMP'S WIFE: That you work hard for what you want in life.

TAPPER: And Senator Cruz refused to endorse the nominee.


TAPPER: Number five, Trump's past went public. There was a former Miss Universe feud.

CLINTON: He called her Miss Piggy.

TAPPER: He responded with a link to her past.

ANDERSON COOPER, CNN HOST, 360: You sent out a series of tweets including one that told people to check out a sex tape.

TAPPER: Then a crude video of Trump. He brushed it aside.

TRUMP: This was locker room talk.

TAPPER: But nearly a dozen assault accusers said it went further than words.

UNIDENTIFIED FEMALE: His hands started going towards my knee and up my skirt.

TAPPER: Trump denied the allegations and said he would sue.

Number four, Senator Bernie Sanders built a huge movement.

SEN. BERNIE SANDERS (D), FORMER PRESIDENTIAL CANDIDATE: We are actually listening to the American people not the one percent. TAPPER: But was the system rigged against outsiders?

SANDERS: Secretary Clinton received about 450 super delegates before anybody else was in the race.

TAPPER: Bernie or bust protesters crowded the convention.

UNIDENTIFIED FEMALE: You're being ridiculous.

TAPPER: And refused to vote for Clinton.

Number three, Democrats were hacked.

UNIDENTIFIED MALE: They are under attack.

TAPPER: Stolen emails from the DNC revealed bias against Sanders, forcing the party chair to resign.

SANDERS: No questions in my mind that the DNC was in opposition to our campaign.

TAPPER: U.S. intelligence points to Russian cyber-attacks.

B. OBAMA: Our goal continues to be to send a clear message to Russia or others not to do this to us because we can do stuff to you.

TAPPER: Number two.

JAMES COMEY, FBI DIRECTOR: There is evidence that they were extremely careless in their handling of very sensitive highly classified information.

TAPPER: The FBI recommended no charges for Clinton's use of a private email server. Still, the issue was gold for Republicans.

TRUMP: She's guilty as hell.

TAPPER: She tried to quell concerns.

CLINTON: My emails are so boring.

TAPPER: But the FBI announced they discovered new ones just before Election Day.

CLINTON: It's imperative that the bureau explain this issue.

TAPPER: The trove contained nothing new but the damage was done.

Number one.

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Hillary Clinton has called Donald Trump to concede the race.

TAPPER: Donald Trump won the White House.

WOLF BLITZER, CNN HOST, SITUATION ROOM: The campaign unlike anything we've seen in our lifetime.

TRUMP: I love this country.

TAPPER: As protesters took to the streets, Secretary Clinton bowed out.

CLINTON: We have seen that our nation is more deeply divided than we thought.

TAPPER: Now a captain of billionaires, outsiders and military men will join Trump for an era of who knows what.

Those were our top ten political stories of this year. The question is who and what will top the list next year.

Jake Tapper, CNN, Washington.


MALVEAUX: Top of the year. I'm Suzanne Malveaux in Washington in for Poppy Harlow. You're live in the CNN NEWSROOM.

We begin with a potential new hacking attempt from Russia, this time against an electric company in Vermont. Burlington Electric says that malicious malware has been discord on one of its laptops and U.S. authorities believe that it is the same malware Russian hackers used to meddle in the presidential election.