lucy -- "i love lucy." all right, and this programming note tomorrow on "john king usa" former new mexico governor gary johnson joins us. johnson had been running on the gop ticket and struggling and tomorrow he intends to switch to the libertarian ticket. how he thinks the party switch will help him and his chances. that's tomorrow right here on john king usa. that's all for us tonight. ier inburnett "out front." millions of people logon to social media like twitter at work every day. what happens when they leave their job. you take your followers with you? one company says no and it is suing a former employee. last night on this program we showed you a video of a little girl ranting about big business and gender roles. 4-year-old riley joins us out front tonight and with the iowa caucus just a week away no candidate has broken out from the pack and it looks like it will come down to the weir.

let's go "out front." -- captions by vitac -- www.vitac.com good evening upon. i'm ali velshi sitting in for erin burnett tonight. out in front, campaign is kicking into high gear. candidates are criss-crossing the state, trying to pick up last-minute support for the first con tefrt in the race for the gop nomination. let's go straight to the political correspondent. jim acosta is on the ground in iowa. good to see you. lots of campaign events and everybody is back in the game. a recent poll shows 12% of voters in iowa, still undecided. you spoke with the iowa gop chair about the race. what did he have to say? >> ali, basically he said this is a caucus race in iowa that he has never seen before. basically, this is the most unsettled field of candidates that a lot of republican operatives have seen in the state for a long time. if you look at the polling you have three candidates at the top

right now. mitt romney, newt gingrich and ron paul and there is a medium tier of the other three candidates. rick santorum, michele bachmann and rick perry and basically according to the chairman of the republican party, any of those candidates could rise or fall over the next seven days. it's a wide open race and it could go down to the wire. >> let's talk about the evangelicals. exit polls from 2008 show 60% of republican caucusers in iowa describe themselves as evangelical. my colleague, christine romans is from iowa and likes to point out that she thinks the rest of us, we sort of used this word and don't fully understand what this means and we almost use it interchangeably and in iowa, it is substantially broader than that, so how do they court this evangelical court? >> well, they're doing it tonight, there's a prominent social conservative who hosts a radio talk show.

his name is steve diest and that is hosting four of the republican candidates, gingrich, santorum, bachmann and rick perry and they'll all be calling in and it will be interesting to listen to that talk show because basically they're all going to be appealing to this voting bloc. the social conservatives that figure so prominently in the iowa caucuses. folks like pat robertson, the christian broadcaster has done well in the past. he ran for president, as you know and did well here in iowa because of that segment of the republican voting population here. it will be interesting to watch rick perry. he's playing harder for this vote maybe more than anybody else in this field right now and it's a smart play. >> jim acosta, thanks for the reporting. jim acosta in des moines, iowa. >> there's a new national poll just out and it shows that newt gingrich's popularity has faded. the former speaker still at the top of the list. he's at 25% down from a high of

37% earlier this month. mitt romney who regrouped his forces now has 24% support, putting the two in an essential dead heat. newt gingrich might be feeling the heat. he just sat down with a one-on-one interview with wolf blitzer and he slammed his main rival, mitt romney. >> mitt romney is the guy running the most ads attacking me and he's doing it through the disingenuous, i don't control my staff and my friends. it's baloney. if he wants to defend his negativity, show up in iowa, 90 minutes face-to-face let the people decide whether or not he'll being bah up what he's been saying and let him back up his moderate record and not conservative record as governor, and i don't think he'll do it. make it moderate and saying that thing that he likes to say. newt gingrich does well with the whole come and debate me. let's bring in nancy gottenhower, a former mccain adviser. welcome toeth bo of you.

hey, nancy, this is in this weird space where perry doesn't like to debate. he said it again to mitt rom ney. come and talk to me 90 minutes, no moderator one-on-one. is this a good strategy for him? >> his sweet spot is not organization, but i would argue that the longer you run the mike on the former speaker, the more you are apt to get a potential problem. this is an individual who is almost like a shakes peerian character. he's got profound strengths and he's got the potential for oops moments that we almost cannot wrap our arms around. i think it is very dangerous for him to be throwing a moderate rock at mitt romney when he criticized paul ryan's budget as right wing social engineering and he was in favor of cap and trade. this is newt gingrich. he was championed in individual mandate which is the pell ar upon which obama care rests. this is not just throwing a rock at a glass house. he has a glass castle.

>> it's a tricky rock, will cane, because it's the rock that could help you win the nomination that may not help you win the election. >> it's not a bad word to be any. >> he's on shaky ground here. let me talk about why that poll might be coming down and why newt gingrich's numbers are dropping and we talked about the massive negative. among conservatives, newt gingri gingrich's rise has been a completely confusing event. how can a man that embraces big government principles be the choice of small government enthusiasts. what i tell you, the role of money and politics are having its effect on his poll numbers and we're seeing the role of money and politics inform the voters about newt gingrich and we're seeing the positive effect of money and politics. >> let's play a little of this conversation that newt gingrich had with wolf blitzer. listen to this. >> a person who thinks the united states was responsible

for 9/11. a person who wrote in his newsletter that the world trade center bombing in '93 might have been the cia plot. a person who thinks it doesn't matter if the iranians have a nuclear weapon. you look at ron paul's total record of systemic avoidance of reality and you look at his newsletters and then you look at his ads. his ads are about as accurate as his newsletters. >> now if he were to get the republican nomination, let's say he were. could you vote for him? >> no. >> all right and that's the headline there. he says he won't vote for ron paul and his views are so outside the mainstream and not only just republicans, but americans. will, i have to say we've all heard ron paul talking about israel. we know that he doesn't share the views of most of the republican candidates on israel, so i thought newt was pandering a little bit on that particular thing. what he didn't take issue was the remarkable racist and homophobic stuff that was in the newsletters that ron paul has refused to come clean about.

he will not tell us who wrote those newsletters and he wrote money on them. in mainstream america this will cost him. >> listen, the role of these newsletter, first of all, did ron paul write them? >> they're still there. did he know about them. they're starting to stretch plausiblity more and we're begging the question, is ron paul a racist? by his former aides, he's not a racist. calling a libertarian a racist is by pointing out an impotent man is a nim to maniac. >> the libertarian doesn't think he should be involved. >> he doesn't embrace that, but, ron paul's letters reflect on his character. they reflect on a man who possibly is a poor manager, a poor leader and aligns himself of fringe thoughts and that's important. >> nancy, final comment from you. does it pay gingrich to go after ron paul because we see national poll after national poll, he may have an organization in iowa, but he's still standing 11%

nationally. >> paul has struck a cord with the essential anti-government crowd, and i would caution gingrich not to be so scathing in his attacks, and this is, unfortunately, i think, one of the potential downfalls for him is he can't resist that arrogance, that disdainful tone and frankly, after listening to president obama for the last several years, i think they've had enough of arrogance. >> will cain, thanks for that. we'll have you back on and we'll continue the conversation. reminder, live coverage of the iowaic caucus begins next tuesday on cnn at 7:00 p.m. eastern. what if your employ every owned all of your twitter followers? a now lawsuit is just about that. the latest developments in the penn state child rape cannedal as well. the reporter who was covering the story comes out front with more information about the wife of jerry sandusky and the

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dottie sandusky, the wife of jerry san curvingy, has been coming under view the me. how can someone be married to a man for 45 years and not know what he was doing. it turns out that dottie s sandusky did tell her husband he would one day be falsely accused. also a reporter for the patriot news joins us tonight from plantation, florida. good to see you. dottie san curvingy was worried that someone would accuse her husband of molestation. she told somebody this. who did she tell and what did he say about it? >> ali, i talked to a man who is now a radio host in state college, pennsylvania, where jerry and dottie san curvidusky. he grew up playing with the sandusky's five adopted neighbors. he's kept in touch with them over the years and he's now in his 30s and he told me that over the years he's had conversations with dottie and particularly this one. he says that it was some time in

the last decade, probably some time after one of the initial investigations by police in 1998 into jerry sandusky's conduct, but definitely before this grand jury investigation began that led to these charges that we're now talking about. he says that dottie had a conversation with jerry and said, look, i think that you might have a boundary issue, and i think that that could lead to a false accusation. we're not talking about child rape which is what's outlined. >> what boundary issues means. >> right. exactly. not rape. not anything sexual. more of when they're wrestling and when they're playing football and when they're horsing around. these are all things that jerry has admitted to. he's admitted to touching with the key being that it wasn't sexual. apparently, she had a conversation with him about this. >> there's another thing that you wrote about. one of the alleged victims who said that he was -- jerry sandusky assaulted him in the

family's basement and that he screamed for help knowing that dottie was upstairs. she claimed she heard nothing. no help came for him. what do you get out of that? >> we know dottie has categorically denied that. she's very upset that accusations like that have been made. accusations have been made that assaults happened in her home and she may not have done something about them. she's denied all of that. in a statement through jerry's attorney she says these children were part of our family. they ate meals with our family. they went on trips with our family. woe took care of them like they were our own children. this neighbor said it was very clear growing up that jerry was busy with recruiting, with football season, with coaching and he was in the spotlight and had a busy life and dottie was content being behind the scenes and being at home. however, in addition to what he told me about that conversation that she had with her husband, she said she was the kind of person that even though she was

content behind the scenes she wasn't afraid to say if she saw something that she believed was wrong. she was very strict with her kids and it doesn't fit into the personality that he knows of dottie for her to be silent and do what these children have alleged which is to ignore. >> sarah, thanks for your great reporting. she's a cnn reporter with the patriot news. we'll take a look at what you can expect for 2012. it will probably be different from 2011. one company doing very well, google. we'll take an exclusive look inside the company's new york headquarters. is it because taking a step represents hope? or triumph? at genworth, we believe in taking small steps every day to keep your promises, protect what matters, and prepare for a secure financial future. no matter where you want to go, one step at a time is the only way to get there. go to genworth.com/promises.

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>> after reporting a sharp decline in holiday sales, sears holdings announced it will close 100 to 120 of its sears and kmart stores. sears holdings reported that sales for the eight weeks leading up to christmas fell by 5.2%. that's not good when you consider that overall retail sales are higher this christmas season compared to last year. despite sears' disappointing news, a new report showed consumer confidence is up for the sixth month in a row. the index rose by 9.3 points. home prices however, fell at a slower rate. as we near the close of 2011, really, i think what we need to talk about is what the economy is going to look like in 2012. joining me is nigel galt, he's chief u.s. economist at ihs

global insight. he's a senior u.s. economist at barclays capital. thank you to both of you for joining us. >> nigel, let's start with you, what's your general outlock for both the u.s. and the global economy in 2012? >> i think for the u.s. economy we see a continuation of the growth in 2012. the key drivers are the consumer and housing. housing maybe activity has hit bottom in 2012 and we're still working off previous excess supply from the boom. the consumer is seeing some improvement in employment and that's helping consumer confidence to pick up and they have a burden of debt. >> sure. so i think modest growth is most likely on the u.s. front, globally. the picture is more worrying than in the u.s. we've seen some slowdown in growth in emerging markets and in the euro zone, we think the picture is for recession and we

think the euro zone has already dipped into recession and it's a question of whether they can contain the consequences of that recession in the financial marks. >> that's the biggest tip to the u.s. >> two distinct threats. we know there's no economic growth and whether or not it becomes a credit and banking crisis is the bigger issue. >> michael gapin, where are the opportunities for our viewers in 2012. is the stock market something they should be staying away from? is real estate something they should sit on the sidelines about? >> we think equity prices may suffer in the first half of the year. some of these uncertainties that nigel mentioned and you mentioned bear little fruit. until we see how that shakes out, real estate and home prices does look a bit better. there's some cleansing that's taking place in the housing market in the u.s. areas that have lower concentrations of foreclosures have been faring much better. some of those regions like california, nevada, las vegas, florida, they're still

suffering, but there's some improvement in the housing market out there and over the longer term and certainly reflect some better opportunity. >> similar views to both of you. it will be a little different in 2012, but you're still very cautious about what will happen. nigel galt and michael gappin, thank you and happy new year. >> thank you. >> when you think of the best song of the year, you probably think of adela or justin bieber. the official video for why a song written for the upcoming film 3 was posted on youtube on november 16th. get this, since then it has taken the internet and the world by storm. listen. ♪ ♪ ♪

>> the song which roughly translates to forrous rage tells the story of a boy rejected by his girlfriend was recorded by tamil in english. you're asking how popular? since last month it was posted by the original video has racked up over 28 million views and the song title is actually the first thing that pops up when you search for just the word why on youtube. it's also spawned hundreds of imitations and parodies including those performed by fans and animated salesmen, and of course, the chipmunks. and you tube videos that include why this accounts for almost 40 million of youtube's total views. the song's popularity doesn't seem to be waning. last week a flash mob danced to the song. police started using versions of the song title to help combat road rage and encourage bike

riders to wear helmets. police campaigns were as catch ney this country. a man faces a lawsuit from his former employer. they claim the company owns his twitter followers and the christmas day house fire that killed a family of five. what the fire chief told us at today's press conference and a tragic end to the case of a missing child we told you about last night. "out front" next. [ male announcer ] alka-seltzer plus liquid gels fights your worst cold symptoms, plus it relieves your stuffy nose. [ deep breath ] thank you! that's the cold truth! so i used my citi thank you card to pick up some accessories. a new belt. some nylons. and what girl wouldn't need new shoes? we talked about getting a diamond. but with all the thank you points i've been earning... ♪ ...i flew us to the rock i really had in mind. ♪ [ male announcer ] the citi thank you card. earn points you can use for travel on any airline,

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the sfam stamford, connecticut, fire marshal investigating the fire that killed five family members said in a press conference that the cause of the blaze were discarded fireplace embers. >> our preliminary findings have led this office to believe that the fire was accidental in nature. the fire appears to have been caused by hot fireplace ash and embers which had been discarded in this area. >> the three children and the parents of the new york city ad executive madonna badger all died in the fire after. firefighters were turned back by the heat and flames. several neighbors said they were awakened by screams on saturday and called 911. >> stamford, 911. >> there is a fire at the house next door to us. the whole house is on fire. >> what is the address, ma'am? >> we're at 2241 sheppan avenue,

there's a major fire, there are three kids and a woman. >> the house which was being renovated had no working smoke detectors and had not received approval needed for occupancy. authorities razed the house after the fire department determined it was unsafe. police in maine are hoping a new $30,000 reward will help them find 20-month-old ayla reynolds. the toddler was last seen when her father put her to bed. ayla's mother is begging for her safe return. >> just bring her home to us. just bring her home. >> they say they believe the little girl was abducted and still have no suspects. ayla was wearing green polka dot pajamas at the time she disappeared. it's a horrible and gruesome ending for a 9-year-old girl. her morgue was sick has confessed to murdering the young girl. 39-year-old michael plu, in ador was in court today and according

to court documents his confession about how he killed her is chilling. joining us on the phone is drew blare. what can you tell us about this confession? >> oh, ali, this was the most devastating confession that could have happened out of this whole story. after three interviews with the allen county sheriff's department michael admitted to killing aliana lemon by striking her over the head many times with a brick. this happened outside of his home and then from there the gruesome details just unfolded for what he ended up doing with her body. >> and it is very gruesome to have to listen to, but he admits to dismembering her body. >> that's correct. this again happened in stages. at first he took the little girl's body, put it in plastic trash bags, put her in the freezer of his home. many hours later he then

dismembered her with a hacksaw into several small pieces. many of those -- many of the pieces of the body ended up in a dumpster in a nearby business. other pieces, the child's head, feet and hands still in the freezer. >> wow! any word on a possible motive? did he say anything about that? >> i have asked the allen county sheriff that very question. he said he couldn't tell anything about a motive at the time. i said do you have one? he said no. >> this man was trusted by the family. he was a family friend, a neighbor. what has the family said about this? >> the family actually has been instructed by the fbi to not address the media. so we have not heard anything from that. as far as the allen county sheriff can tell me, they, of course, are devastated. they trusted a man enough to leave their children with him, and any family, you have to have that trust in somebody, and this is more than horrific. >> drew, this is in fort wayne?

is it a suburb of fort wayne? tell me a bit about the community. >> we are in northern allen county, just outside of fort wayne and fort wayne takes up most of allen county and the community itself very small. it's off the beaten path and you wouldn't know it's really there unless you lived here or had to cover a story, unfortunately, about 30 mobile home units and otherwise quiet until something like this happens. >> wow! drew blair, thanks for joining us. it's a sad ending to the story. we spoke to the family members yesterday and we were hoping that it would have a better ending, but it doesn't. drew blair joining us from fort wayne, indiana. do you tweet at work? who do you think owns your twitter followers? you or your company? we'll talk about that and a 4-year-old girl named riley with some big ideas about business. she comes "out front" coming up next. ts from new zealand, textile production in spain, and the use of medical technology in the u.s.? at t. rowe price,

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those of you who tweet you can follow this show at @outfrontcnn who owns those accounts? who owns the followers of those accounts? especially if you tweet at work or for work. the big question is who owns a twitter account? is it the person tweeting or the employer. >> phone dog versus noah kravitz. it's a mobile news and review company. noah kravitz used to work for

them. he worked under the na name @phonedog. when he decided to leave the company he said phone dog told him he could keep his tweter followers as long as he tweeted on their behalf every once in a weil. noah claims he agreed and changed his twitter t to @noahkravitz and he kept on tweeting. phone dog sued noah claiming not only did they ask him to completely give up the twitter account when he left and not just the name, the account, but that those 17,000 follows are actually belonged to them and they're seeking damages of about $340,000. noah kravitz is now editor-at-large for a company called techno buffalo and he joins me now. noah, good to see you. thank you for being with us. >> thanks for having me. >> let me ask you before i get started, would you like to buy a twitter account? >> do you have one to sell? here's the question. >> no. >> my followers are their own

property, and i love all of them. >> okay. >> this is what it comes down to. the followers you say are their own property. your former employer claim they're theirs. where does this number come from? $340,000. >> that's a terrific question. i think if you took their valuation and applied it to the twitter accounts of lady gaga or shaq, you would have the gross domestic product of the more than one nation on earth per month. so you would have to ask phone dog and their counsel. >> they in their complaint say when you resigned they told you to relinquish use, that's their word, of the phone dog account. is there a miscommunication here? >> it's unfortunate because i had such a great run working with them. we cover the mobile industry, like you said and sort of hit the timing right when mobile was exploding in the u.s. if you go to their site, it's

still up there on their site and their you tube channel, my last day at work was friday, october 18th, 2010 and i chose to run it the following monday, when i was no longer an official employee and both my written post and the video on the you tube channel both direct people, hey, i don't know what i'm up to next, but if you want to keep tabs on me, go to @noahkravitz. they said yeah, it's your account. would you tweet for us from time to time and perhaps naively i said of course, because we had such a great working relationship and i was a fan of what they're doing, and -- >> i'm going to play -- i won't do it right now because i'll talk to a lawyer and i'll play it just to see if that's relevant to the case, but you did tweet just a short time ago. social media users be careful when using your company's name

with your online handles, you never know how/when your employers might react. >> when i joined cnn and when i started tweeting it was before we had established policies on this and over time we've established policies and i am now bound by those policies as we went along. what was your situation at phone dog? did you have policies about who owns the name and what you can do with it? >> i don't think any of us knew what a with thor was when i joined. there was nothing -- >> as it evolved did you develop policies and did you have conversations with them? >> we had conversations and, you know, i started this account linked to my personal e-mail address, being, because i was using the company name, you know. we agreed that was a good idea. frankly, this was all born out of sort of, you know, in retrospect, kind of naive, misguided, small business exciteme excitement, you know? we'd stumbled upon something when i joined. there was no blog or youtube channel at phone dog and we made

a foothold in our corner of the world and the you tube channel took off relative to videos about phones and it was a great, great time. >> we reached out to phone dog and we haven't heard back. the company made a statement to the new york times. the cost in resources invested by phone dog media into growing its followers and fans through social media are substantial and considered property of phone dog media llc. we intend to protect our intellectual property, trademarks and brands. noah, do you care that much about your 17,000 followers. is this fight worth it to you? >> you know, i care about each and every one of them. the ironic thing is i picked up a couple thousand followers in the past few days. this whole spat actually started over something else, and my personal situation, i don't think is what the viewers are interested in and their twitter -- this whole claim

about the twitter thing was delivered to me, you know, i start with papers on a sunday night in july entirely out of the blue. >> there was nothing in any work contract specifically about twitter. they never had nor never asked me for the password to the account. the confidential -- the confidential customer list they're talking about, these are publicly available and go to twitter.com/noahkravitz. they're all there so i'm not sure what this is found in. >> we'll continue this discussion, thank you for joining us. >> noah kravitz, i want to bring in our legal contributor to talk about the broader implications of a case like this. i just want to know if this is relevant. he recorded this youtube statement and they posted it on their website, so everybody agrees that this was done. let's play this. >> it's time to move on. so you can follow me online on twitter. my new twitter handle is just my

name, noah kravitz. >> okay. so he said if you want to follow -- this is my new twitter name. it was actually the same account because you can change your handle, and that seems to be where this derives from because i don't think they care that he tweets under the name noah kravitz. it's that this is their account. >> well, and they want the 17,000 followers. i think people who are not in the twitter world. >> first of all, it's very hard to accumulate followers on twitter. you get a twitter handle and you try to get people to follow you. 17,000 is a substantial number of people. this company, phone dog is looking at the 17,000 like it's a secret customer list and that they put their resources in to the accumulation of the customer list. traditionally, customer lists are considered to be trade secret secrets. >> why are they trade secrets? >> you can see who follows everyone? >> so this is a trade secrets

lawsuit? where is the secret? if you go into twitter, you click on your name. we know who you're following. >> right. so the company is very angry, though, they want the will followers bank and they come up with a novel theory which is baueried deep in their complaint. they needed a seeket, the coca-cola secret, paragraph 12 of the complaint, the password to the account is the secret and that he was the only one who knew the password and i guess, presumably the company and he used that secret to then change the account into his own name, thereby stealing the 17,000 customers. now, will a federal court buy this ultimately when all of the discovery is complete? i have my doubts. >> i guarantee you they and everyone else in the social media world and everybody with a twitter account will be watching it very careful low. >> you bet they will. >> thank you for shedding some light on this. anderson cooper, we will do things a little differently

tonight. rather than me ask you what is coming up on the show, i've got a special guest for it. >> anderson, what do you have coming up? >> wow! >> she's a guest coming up later on this show, but we thought we'd mix it up a little for you. >> wo is that? ? she's little rile pep she had the rant about -- >> oh, my gosh, yeah. >> why force girls buy pink and princesses and boys can buy superheroes. >> it's cool. i look forward to that. we're keeping them honest tonight. newt gingrich in iowa on the attack, taking shots at mitt romney, but in 2006 gingrich praised romney for the same things he's attacking him for, health care reform in a newsletter called newt notes. gingrich's explanation in his own words tonight. also tonight, selective breeding. this is just an extraordinary story. people operated on against their will in the united states, force

believy sterilized. it happened as recently as the early 1970s. victims are promised compensation and years later they're still waiting. it's a shocking story and an important story and something to make you smile at the end of the night. the ridiculous to the top of the hour. >> see you later on tonight. "out front" next, an exclusive look at the new york hq of the web's most popular and powerful search engine, google. [ male announcer ] you are a business pro.

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google. it's averb, it's a word. everyone on earth knows. erin took an exclusive tour of the headquarters with the executive chairman eric schmidt. >> america is the best innovator in the world today. that's going to continue. america has 18 of the world's top research universities. it's the world innovation center. it's still possible for two people, three people with a graduate student and so forth to create a brand new company that will change everything in the world today. there's every reason to believe that america can grow very, very successfully with a focus on innovation. >> there's a reason eric schmidt is so confident about the future of america. even in hard economic times, google is thriving. revenue surged more than 30% last quarter. putting schmidt in a good enough mood to give us a rare glimpse behind the scenes. this is the second biggest office for goog until the world? >> that's right. >> in manhattan. >> yes. in downtown manhattan.

3,000 people, one large building and an adjacent building. half and half high quality engineering and sales and marketing. nobody thought you could build the world's best engineering center right in the downtown of manhattan, but you can. >> situated in the meat packing district of new york, the unique office space spans two buildings and an entire city block. >> the old moth model was you had your office and the door would be closed. but this is much better. if people want privacy they put on headphones and listen to music. but they start screening all day. >> there are snack stations with free food every 150 feet. an incentive to keep people close to their defection. >> the only aspect that matters is people in a company like this. so keeping them here, keeping them motivated, frankly, they work incredibly hard. we give them connections at home. and they work pretty much all the time. after all, they're trying to change the world. so they really care.

i don't need to worry if they're at work, i know what they're doing. we can see whether they're making progress or not. >> you can literally watch it in realtime. >> waend do. >> people get worried. they say china and indiana are turning out engineers. are they turning out better ones? >> they have the best in the world. we try to hire them. we'd rather have them here in america working for us and greater benefits for america. >> google is doing everything it can to hire the best and the brightest all over the world, with 60 offices in 30 countries. what countries would you say right now are the least open to what you do? >> the most shocking country of all is north korea. north korea is very difficult to operate in, but it's a country where there's so little conversation and so few people peering into it, that people really do believe that their dear leader really is god-like, even as people are starving in the streets. and some time in the next few years north korea will open up to it's the last one. >> then a country like china, do

you feel you have the opportunities you need in china? because it's amazing to see it's not youtube, it's you koo. they've built their own companies for the biggest growing market in the world. >> in the chinese model, there's a chinese equivalent of every american firm. there's a facebook equivalent, twitter equivalent, google equivalent, which are doing well. chinese laws make it difficult for american companies to enter china and operate. you have to operate through a joint venture and you're subject to these horrendous censorship loss. we decided to move to the other china they love to say, one country, two systems. we prefer the open system of hong kong. there is a firewall literally called the great firewall, which blocks content that they don't like between hong kong and the mainland forcing them to do the censorship. we just could not abide by their rules. >> is this really going to be the century for china? >> china is the world's

manufacturer, and they do it very well. they do not yet have all of the advanced society functions that they need, an independent judiciary, the kind of political dynamic, creativity, the kind of advanced universities that are needed to do what we've been able to do in the united states. there's an open question as to how long it will take them to get there. >> in china this summer. his name was bill. they named him after bill gates. we had done this question as to whether the next bill gates or steve jobs would be born in china or in the united states. part of that is luck, but part isn't really luck. where do you think the next one of those people will be born? >> i think the next one of those people will be born in america and will be a successful american entrepreneur. not just birth but the system they're part of. innovators create millions of job in america. we need to create them and welcome them from other countries when they want to come and relocate to america. >> we're still not doing that to the level we need to be, are we?

>> of all the crazy rules in our government, the craziest of all, bar none, is that we take the smartest people in the world, we bring them to america, we give them ph.d.s in technical sciences and we kick them out to go found great companies outside of america. this is madness. >> more than 31,000 people work for google and new york is the company's second largest office after its sprawling headquarters in mountain view, california. here the motif is classic new york city. hallways with fake subway grates, conference rooms that look like a meat locker and razer scooter to get from one building to the other. huddle rooms, designed after city apartments, are there to make people feel at home. woman's apartment. >> yes. >> bra on the bed and a cat. really? and a cat? privacy is always an option, schmidt says the best ideas come from people working together in extremely close proximity. what's the future for google? you've got the google tv, you've

got the phones, you've got the search. but you also have wind farms, diagnostics, clean power, your finger is in a lot of pies which could be a sign of strength or a sign of lack of direction, which is it? >> it's of course, both. one of our strengths is lack of direction. we actually let people invent new things and we see how far they go. if they work wonderfully, then we'll continue them. if they don't work so well, we'll try something new. goog sl the largest systematic innovator at scale i know of. we try to bring out new things and see if they work. we've done particularly well in information technology, information search, which is essentially a math problem. and we do that i think better than anybody else. >> last night's broadcast we played this clip of a 3-year-old girl named riley carefully laying out her problems with business. at the end of last night's segment, i mentioned that i'd love to talk to riley. unlike some of the people actually running for office, she didn't duck my my interview

request. she joined us "out front" earlier. i think you're carrying an elephant with you. who is this? >> mr. elephant. >> can you hold him up to the camera. mr. elephant is your toy, but when we saw you in the video, you were complaining that sometimes they make some kind of toys for girls and some for boys and you didn't like that. tell me what you think about it. >> the girls can buy superheroes and the boys can buy superheroes. >> do you think it should be fair for everybody? >> yeah. >> and do you like superheroes, that was your point? >> plus i have a closet full of superheroes. >> you have a closet full of superheroes. >> and i have all the houses like bat caves and i have a box of action figures. >> so do you think it's fair now? do you think things are getting more fair that boys and girls can buy anything they want? >> yeah. nnc >> in the video, you were complaining that they were tricking girls into buying

things that are pink. but you are wearing pink pants. you like pink. >> blue, purple and pink. >> you like blue, purple and pink. you don't mind that girls buy pink stuff. you just think that girls should have a choice. >> yeah. >> tell us about you. we all watched this video about you, but we don't know anything about you. where are you from? >> new york. >> that's upstate new york. and you go to school. >> yeah, nursery school. >> what do you do at school? >> they have like groups like our table, play room, play tables. >> what did you get for christmas? >> a fruit stand and car thing. >> what do you do with a fruit stand? >> just sell fruit and vegetables. >> you sell fruit and vegetables. so you're like a little businessperson. have you done that yet? >> i think so. >> where do you get the fruit and vegetables from?