back everything it sees and hears and performs simple tasks around the house and some people find it cute. romo's face reacts to what's going on around him as he zips around. >> they say it costs about $150. >> i don't think he can feed the dog though. >> no, all i can think of is tony, the quarterback for the cowboys. i mean, probably too much football. a big day for fans of the classic sci-fi series "dr. who", marking the 50th anniversary with a series of stamps and commemorate the actors who played the title character over the last five decades and interesting to note the villains are included and they will appear on a set of second class stamps. >> hmmm. >> don't get first billing. you're a villain, you don't get the top stamp. >> that figures. that will teach you to be a villain. that's it for us. >> america live starts right

now. >> megyn: fox news alert on the new detail coming to light what just came in in the last minute deal. to head off a series of the tax hikes and spending cuts we were expecting. welcome to "america live", happy new year everyone, i'm megyn kelly. we're learning more about the budget deal congress passed late last night. this started out as a debt reduction bill and ended with spending and increase the nation's debt. didn't work out exactly as planned. the bottom line, this law will provide 620 billion dollars in new tax hikes. and 15 billion in budget cuts. and for those of you keeping track at home. for every $1 in cut, according to the so-called debt deal adds nearly 4 trillion dollars to federal deficits over the next decade largely because of the extension of lower tax rates for almost all americans.

330 billion dollars of it is also an increase in spending, an increase in spending, more, more spending. plus, congress packed in some special gifts for the railroads, the car racing business, and some friends in hollywood who have some deep pockets. chris is our host of power play on foxnews.com live. happy new year! >> happy new year to you, merry cliff-mass. >> megyn: we went off the cliff and we're kind of off it, but moved the cliff and the cliff is in a weird place. postponed part of it. in any event, there's big tax hikes for the rich and hikes for everyone, 77% of americans. and there's more spending, there's 4 trillion more going into the deficit. i mean, i don't know. it's like, all right, fine, washington, you people in that town are nuts, everybody knows that. >> accurate. >> megyn: you say in your power play column today before we get to the special things for hollywood, in your power play column we did learn something very important about

second term barack obama. and what is that? >> that he's going for it and you saw the president, if you think about this, megyn, back when this was designed to be a deficit reduction deal, as opposed to a deficit increasing deal, that the republicans came back after the election and said, hey, how about 800 billion dollars in new taxes, new tax payments from rich people and the president said, no, because unless you're willing to raise rates, not just close the loopholes, that would have them pay that money, he wouldn't go for it and he made it very clear that he would take it up to the wall. moderates and the sort of mandarins of washington said, well, maybe there's going to be a big deal in here. the president said, no, as a matter of fact, i'm going to take you right up to the wall and i'm going to get everything that i want and he did. he pulled it off. and he was even willing to give up 200 billion dollars in tax revenue from these wealthy top earners in order to win on the ideological point that it

would be rates not payments that went up. the republicans need to be aware as they go forward into the age of a second term obama, he's taking them to the wall every time. >> megyn: oh, but you haven't spoken to mitch mcconnell. mitch mcconnell, the republican leader in the senate now has got some tough talk for president obama and he came out and side the following last night. now it's time to get serious about reducing washington's out of control spending. that is the debate the american people want. it is the debate we will have next and it is the debate the republicans are ready for. so now that he has no leverage, he thinks he's going to have a real discussion about out of control spending. you tell me, chris, how likely is that? >> well, we have the debt cliff. we have the debt ceiling is next. and that's coming up. and if john boehner wants to stay as speaker of the house, the thing he's going to have to tell his members is that he's going to play just as hard on that as the president played on these taxes and that

he's got to be willing, if he wants to do this, if what mitch mcconnell, who is the architect of this deal on the republican side in the senate, if what he says is going to be true, that means the republicans have to be willing to do some pretty terrible stuff, like get the blame for shutting down the government. get the blame for throwing the economy into recession, really do those things. so the question is this, megyn, are they willing to do now what they weren't willing to do before? that is, shall we say, an open question? >> well, maybe it is. i don't know. and they is say past is prologue. on the money front, it did -- not everybody, it wasn't just the rich. the rich paid more, but there were some people who got some good deals out of this fiscal cliff deal and it includes a bunch of hollywood producers who apparently received 430 million dollars in tax benefits, thanks to this extension of a tax benefit, i don't know if it's an expense rule, they allow them to expense up to 15 million

dollars of costs in their projects. i don't know how it works, but hollywood got a 430 million dollar kiss from washington. is that, is that a president obama thanking his donors thing or is that something that we just do in every year because there's pressure from hollywood to do it? >> well, they have very powerful lobbying arm in washington and they are a big patron, the movie business, big patrons of the democratic party and of the president and this is what happens. and you mentioned nascar, you mentioned, i believe, the-- >> and 70 million dollar kiss and electric motorcycle makers are getting a 4 million dollar kiss from washington in this deal. >> and what happens when you run a crashed up freight train like this at the very end, and you do it wrong, when you make law incorrectly. when you do it in a hurry, in a dash, at the end of the year, trying to get it done, what happens is there's lots of nooks and crannies for people to stick things in for

their patrons and for their friends and it goes against what republicans said when they came in, which was we're going to be slow, we're going to be deliberative, we're going to read the bill and this does not come out looking like a bill that has been closely scrutinized. >> megyn: it was nice when we were off with our families around the christmas tree and didn't have to think about this nonsense. not going to have read the 400 e-mails from our producer every day, telling me every iteration how the fiscal cliff was getting nearer. here we are again, i don't know, chris, it's tough to have the holiday spirit when you look at what's happening inside the beltway these days. >> it's true, but at least we've got each other, megyn. so we'll get through somehow. >> megyn: amen to that, brother. thanks for being a part of "america live" looking forward to many more of these in 2013. a little more for you now on a few of the industry tax breaks found in this bill. 331 million in going to railroad companies to maintain

their train tracks. the federal government is refunding 222 million dollars to the puerto rico and u.s. virgin islands forum, and to algae growers to encourage the production of biofuels. and the fiscal cliff bill passed in congress does not address, among other things, the nation's debt ceiling which we have already hit setting up the next economic dialog to be played out the coming weeks. here you thought the fun was over. it congress does not raise the debt ceiling the federal government will not be able to pay its bills and here is a look at the situation when the president took office and today, when it comes to the national debt. in january of '09 the debt stood at 10.6 trillion dollars, and by the end of the president's first term, the national debt has risen to more than 16.3 trillion dollars. that's about a 54% increase in over four years. but while the president acknowledges that the deficit

and the debt are too high, he warns he is not budging when it comes to another debt ceiling increase. >> while i will negotiate over many things, i will not have another debate with this congress over whether or not they should pay the bills that they've already wracked up through the laws that they passed. >> the president hasn't had a budget in his entire presidency, no matter who was in charge in the house or senate and he doesn't want one. he will in fact be the greatest spending president of all time and there's no question at all. he plans to leave office with the trillion dollar a year of deficit happily. >> megyn: see, the president says he's not going to deal with the congress on that, but he has to that's sort of how we got into the fiscal cliff position. the last time they had to raise the debt ceiling the republicans said we're not doing it unless we have offsets and cost saving measures and they came up with this plan that we all just

basically fall apart the end of 2012 so the president kind of hacked the deal with congress on this. tion, who wi will the republicans be able to force him into some spending cuts in exchange for raising the debt limit again? he's saying, i'm not doing that again, but are the republicans going to give it to him if he doesn't do it again? as he mentioned technically the nation hit the limit, that happened on january 1 and the treasury secretary tim geithner says he can continue paying the nation's bill for two months. it's not indefinite. it looks like maybe february, march, we're going to be having the same debate about the debt ceiling again and many other things and we'll hit you with those later in the show. there's only so much you can process back from the the holidays, right? despite the political back and forth over preventing tax increases nearly every working america is going to see a 2% tax increase, about 77% of americans because the bill

allows the social security tax cut that was passed a couple of years ago to expire. so a tax cut is going away for 77% of american taxpayers. so, for example, if you've got a 4% raise this year, uncle sam just took back half of it. michael reagan today asking why a tax hike on that number of americans is not a bigger headline today. he'll join us next hour with his take on that. new fallout our nation's school in the aftermath of the newtown, connecticut tragedy, students in marlboro, new jersey, returning to school to find police officers standing guard. town officials vote today staff nine schools there with armed and uniformed guards, just days after a gunman stormed sandy hook elementary school on december 14th. 20 young students and six teachers died. parents in marlboro say they support the move. >> i think it's a good idea after the shooting up in connecticut and just to make the kids feel a little safer.

>> it makes me feel safer 'cause i know what happened to the kids and it makes me feel really safe. >> is there any emotional event to this, i personally have a hard time talking about it and seeing the images. >> megyn: marlboro's superintendent says the officers will be at the schools for the next three months while the town figures out if there are more cost effective ways to keep the schools safe. and now, the latest on the survivors from the shooting at sandy hook elementary as they prepare to return to classes. students today did a walk through of their new school and the nearby town of monroe, connecticut and the town local officials are going to great lengths to make this transition as easy as possible on the children. david lee miller is live near chalkhill middle school in monroe, david lee. >> reporter: that's right, megyn, the new schedule to get underway a few moments from now. we just learned that a short time ago, the governor toured that school, as you mentioned it's named the chalk hill

school in the nearby town of monroe. the chalk hill school was closed a couple of years ago because of a drop in enrollment, now it's going to serve a very special purpose for the forseeable future, students from sandy hook will be attending chalk hill about seven miles away. as you would expect, the security is incredibly tight, so tight that cameras are kept away. all media has to stay away two miles at a local park, where i am now. a check point outside the school, doors have been checked, locks have been checked, fire alarms have been checked and in addition to those preparations we're told in the interest of trying to make the children as comfortable as possible they've brought in furniture and other items from their old school to try and ease this transition. this is a community, megyn, that has been devastated, many here feel it won't be the same again anytime soon if ever. tomorrow, officially will be the first day of school.

>> megyn: all right. david lee miller, thank you. we are going to see the launch of some significant health care changes as the affordable care act, obamacare, starts to take hold. this is it now. they've got a year before this thing really kicks in. many facing higher overhead costs, companies, because of the health care law and many of these businesses are already weighing their options, and here details that some employers ever considering in an effort to manage their rising costs and how that might affect you. and fallout for the local newspaper who decided to publish the addresses of people holding lawful gun permits. a county is fighting to keep it private. papers going after another county. and unfolding in his district and what he plans to do about it, he's not happy. plus, a new gallup poll shows that many americans think the best days of this country is behind us. >> what's behind that.

>> well, the new year means new decisions for companies facing higher costs under the health care law. full effects will not be felt until 2014 and many businesses are looking at options and decisions whether they're going to cover the employees, pay the penalties, here to walk through it is lou dobbs, host of lou dobbs on the fox business network, lou, they've got 12 months, if they don't have insurance programs in place, people with more than 50 employees have to get them and companies with bigger companies and health insurance, are they going to keep them in place, kick people off the rolls and it's cheaper to pay the penalty of 2 to 3 grand? where is this likely to go? >> according to a number of is your have i, including one from mckenzie, foremost in the country, another by price waterhouse, at least 53% of

the companies, the more they find out about what obamacare represents, are making the decision to eliminate the employee-sponsored insurance program. and this is sort of -- this is staggering because obviously, one of the reasons for obamacare, the appeal of it, was to make certain everybody's getting covered. well, it turns out it's not going to be close to that. >> megyn: don't forget if you like your doctor, you keep your doctor. if you lose your insurance plan from your employer, and have to wind up on the government exchange thing, who knows if that policy is accepted and so on. >> that's part of the equation and the other question will be, because reimbursement will begin for quality of care, not the number of patients, hours, et cetera, and procedures, but that a subjective definition of quality of care which hasn't even been written yet, the regulations for obamacare haven't been written yet and the fact is, no one knows if the doctor will still be there. because they're now projecting most of the analyses that

we've looked at are projecting we're going to see a doctor shortage ranging up to about 25,000 doctors in this country as a direct result of the way we're changing the medical care delivery system here. >> megyn: the wisdom, conventional wisdom on the left, out of the white house, on this was these employers are not likely, okay? as i say it's d-day, 12 months to decide, actually less, whether they're going to keep your employer-based insurance program in place, because they have to give you notice that they're kicking you off. they believe the employers wouldn't do that because of competitive reasons. because they start losing employees who aren't going to get the employer-funded health care and their company and go to that company's competitor. >> that turns out that's not a well-placed confidence on the part of these companies and regulators and the left with conventional wisdom. i have to smile when we talk about the left's conventional wisdom. wisdom is hardly conventional on either side in washington d.c. in my opinion.

the fact is that we're looking at reality, that employees say they will stay with the company, even if they remove the employee-sponsored insurance and that's surprising a lot of people. and it's also contributing perversely to the decision making of the company themselves, well, if that's the way that 65 to 85% of my employees feel. >> megyn: why don't i get rid of the plan. >> we'll take care of the business. >> megyn: will they hope a competitor will hire them. the other thing is, you've got retail restaurants, retail restaurants that allowed lower income and part-time workers, some have limited coverage or no coverage. >> right. >> megyn: they may now get swooped into obamacare. >> 30 employees or more. >> megyn: and there's talk about whether employers are much more rigid not letting them get more than 30 hours a

week, unless they across every, will companies cut back. >> megyn:. >> we've seen it already. one big example is darden restaurants famously saying it's precisely going to do that. as a pilot program. there was such a reaction that what we're going to watch is not companies failing to do that, but they're not going to be darden dumb and-- >> announce it. >> and announce it. they're going to carry out these and in fact, we know a number of these companies are. >> megyn: and we're going to hear stories the next 12 months what employers are deciding to do. >> at that point it's going to be a fait accompli. and jobs are scarce, despite the nonsense and political theater in washington, we still have 23 million americans not working. underemployed in this country, and god knows how many who have just decided, i'm not even going to apply. i've given up on jobs. and then we have the, you know, the arrogance and the incompetence of these two political parties exposed during the course of this

so-called fiscal cliff. it's a very troubling time. because they couldn't even come together and make sense out of it, something they called obamacare and have it actually work. despite the best of intentions. it's a mess and it will be a mess certainly when it's fully implemented at the beginning of 2014. >> megyn: premiums have already gone up for a lot of americans and boosting workers premium contributions more and budg putting the burden it if not on the employees. i've got to run, lou, thank you. >> a pleasure. >> megyn: happy new year. >> happy new year. >> megyn: an al-qaeda group is now offering a bounty to anyone who kills our ambassador to yemen or manages to kill a u.s. soldier there, this is unbelievable. up next, see why the significance of the messages goes beyond just the new threat to americans lives. the young woman admitting to the brutal killing of her boyfriend. wait until you hear her case

on kelly's court.

>> it was an especially nice moment at the rose parade in pasadena, california yesterday. watch this. (cheers) (applause) >> love that. don't you love that? i love it when the little kids recognize it's their dad. sometimes their mom coming home and they burst into the run. sergeant first class jumping off the float and reuniting

with his wife and four-year-old son watching from the stands and the family locked into an embrace seen my hundreds around the world. after a moment the family got back on the float honored as guests of the parade and the sergeant first class has served in iraq and afghanistan and received the purple heart and the bronze star. the end of this week he will return to afghanistan until his discharge date in march. god bless that family. well, a disturbing new threat from al-qaeda in yemen today. our chief intelligence correspondent catherine herridge brings us. >> they tell that the ambassador in yemen as well as the u.s. personnel is credible. al-qaeda is considered the most active and lethal of the al-qaeda affiliates and separates al-qaeda in yemen, bun ever the many propaganda videos on the web. singular focus on attacking western, specifically u.s. targets, including the u.s.

homeland. and without commenting on the ambassador's security in yemen, this morning the state department released a statement that reads in part, quote, we have seen these reports and we take such threats very seriously. we will continue to monitor the situation. as you know, our embassy in yemen already operates in a highly sensitive and difficult security memory, the middle east research institute, says it's superimposed over ambassador chris stevens, see it on the right. at least deleted from one version on the web. a member of the house intelligence committee tells fox he believes that al-qaeda in yemen is seeking to capitalize on the ambassador's death in benghazi on 9/11. >> i think there's no doubt that al-qaeda, and seeing what happened in benghazi as a major victory for them. whether it was or not. the fact they were able to four americans, and the american response has been so confusing and so inconsistent that we've certainly, a major

victory for al-qaeda. >> what's not sitting well with analysts, and trying attention to target u.s. interests because this of course undercuts any element of surprise, megyn. >> megyn: catherine herridge, thanks so much. >> you're welcome. >> megyn: well, courts of new york, new jersey, connecticut lawmakers have been bashing speaker john boehner and republicans in the house for not voting on a hurricane sandy relief bill worth 60 billion dollars. what people are not hearing about are the concerns, we are told, with some very expensive problems with this bill. we'll show you what those are. a new twist in the drama over one newspaper's decision to publish the names and addresses of all the gun owners in its region, those who have licenses, to carry. and why our next guest thinks that law abiding gun owners.

and some think the best of this country is behind us. we'll look at what's driving that worry and if change is possible. >> on our coast lines, we play and thrill in joyful revelling, for every citizen there's a haven of his own and singly and in groups we make glad this day of deep appreciation. no class divisions mar our pursuit of happiness.

>> welcome back, 1:32 in the east.

president obama is urging house republicans to vote today on a 60 billion dollar bill that would provide aid for states hit hard by hurricane sandy. the republicans point out the bill includes more than just aid for storm victims. they say it includes items like 150 million dollars in funding for alaskan fisheries, 336 million dollars in amtrak expenses, and 2 million dollars to repair a room on one of the smithsonian buildings and that is just to name a few, so, they believe there's a reason for taking a closer look at the bill before voting on it. ♪ meanwhile a new gallup poll, is today looking at america's future and how americans feel about it. when asked if america's best years are ahead or behind, half of the citizens here said it looks downhill from here and their view of 2013 is particularly bleak. why? why are americans so down about the future now? you've got 50% believing our best days are behind us.

joining us is kirsten power, columnist for the daily beast, and chris plant, radio host of the chris plant show. a happy way to start the new year, our best days are behind us? that's what a majority of americans believe when you look at the breakdown, it's somewhat partisan more republicans believe our best days are behind us, democrats feel they're ahead of us. but independents are with the republicans on this. i'll start with you on this, chris. why do you think that is? >> well, because we're leaving in pretty bleak times, austere times, that the american people, i think, in our guts, we know that things are not headed in the right direction, that the economy is on the skids, that we're kind of told inexplicitly, that this is the new normal, that the unemployment rate is going to be like this and our growth rate anemic, and that's the new normal. things look pretty bleak. i have a friend a small

business owner told me at a christmas party, that surviving is the new prosperity and that's kind of where we are. >> megyn: what's interesting to me, kirsten, gallup asked do you think we'll see increasing employment or rising unemployment. 53% said we'll see increasing employment and 42% said unemployment is going up. the bleakness doesn't steeem to be tied to the unemployment. it seems to be bigger, and broader than that. >> one thing i would say that half of the people are pretty negative, but half the people are pretty positive. i mean, it's not that big of a difference between the people who are positive and negative and that's extremely partisan. if you look at democrats, they overwhelmingly think the best years of ahead of us. so i think a lot of the negativity and the positive side comes from what you think about president obama. look, he was just reelected and i think if you're a person who thinks he's a bad leader then you would naturally think that things are not going well. >> megyn: even the republicans know he's only got another

four years and somebody else will come. >> well, but i think republicans really believe that he's such a bad leader for the country that they can't imagine that things will go better and i think that democrats feel like he's a good leader so things will go better. overall, look at the last year, megyn, it was a very rough year and i think that people tend-- that tends to have a drag on what people are expecting in the future. and you know, for every story about somebody, about feeling like there's small businesses doing badly, i have friends who have small businesses who are doing well and are optimistic, so, you know, i am optimistic about the future, but then again i'm a democrat so i can-- >>, but this is sort of like, you know, the carter years, chris. >> yes. >> megyn: americans were very pessimistic and people believed the best days were behind them and president reagan came in and morning in america and it seemed like democrats felt like he brought something new and more positive to the country and the republicans who are dismayed and if it's all about president obama, looking at a

page turner in a few years as they did back then? >> well, yes, absolutely. and i think that's why the people, if you asked the question differently, i think expect -- and i expect this, i expect an economic malaise in the short-term and perhaps the medium term because we've embarked on a path, economically speaking, that mirrors essentially what a number of socially democratic countries in western europe have done and they've all gone bankrupt and their unemployment rates are astronomical. and as we pursue those same economic models, i think we can expect to find the same results here. now, yes, we can turn it around, but it took ronald reagan to turn it around and our country first turned gray and we had the economic malaise and we asked the same questions then. >> megyn: where is chris going? sorry, chris, no-fault of your own, the camera is moving around. >> and we were able to turn around thanks to ronald reagan, with an entirely new

set of policies. but we're embarking on an economic model, on an economic path that's going to obligate us to spend an awful lot of money that we don't have and also now the debt to gdp ratio is completely out of whack. >> megyn: over 100%. >> the carter administration-- >> over 100% now, debt to gdp. put those numbers down, i'm talking about numbers that aren't matching the screen, but other' over 100% now in terms of our debt to gdp ratio which makes us look much more like europe than we did in this country a few years ago, it was more down in the 60's. i want to ask you, kirsten, because i realize there's definitely some partisan lines here, but the gallup poll taken from december 14th and december 17th. december 14th was the day the newtown, connecticut massacre. >> right. >> megyn: and how much do you think other issues, besides the economy, seems like, you know, just shook the whole nation about how that could happen in america. >> yes. >> megyn: i know 75 years ago children were also massacred by a bomb in a school and i'm

saying it's not an everyday occurrence in this country, you've got that. on a separate note, you've got a celebrity culture and famous based on sex tapes and make millions of dollars and how much of that and uber presence in our society plays into this, do you think? >> i think it plays into it enormously. i don't think it's just about the economy although people do typically think of the economy, but i think that the fact that it was taken around that time does have something to do with it. and look, that was i think the fourth or fifth major shooting like that of the year. now, there were so many of these shootings and i think that that definitely affects people, but i also remember in the early 1990's, you know, if you went back and pulled up the polls from there i'd be interested to see what they look like when people were saying our best years are behind us, now, this generation will never do as well as their parents did, and then of course, we had the tech boom which nobody really saw coming. so, you know, we don't really know what's going to happen

and i really think whether a democrat or a republican, i fundamentally believe the united states is going to be able to bounce back from this and we actually have responded a lot differently than europe has, there's not enough time to get into that, but i think that we have responded in a different way than they have and i don't think we are going to end up in the same place that they are. >> megyn: what do you make of that, the cultural influence, chris? because america has been sharply partisan for much of its history, the founding of this country and the next hundred years we've always been hyper partisan, maybe they got along better, maybe at the end. day reached an agreement a little better, but, you know, that's how the system was set up. so how much is the hyper-partisanship we're seeing in washington affecting this versus other intangibles? >> i've lived in washington for years and i'm embarrassed for my species. forget about washington or voting republican, the rest of it, if this is the best the human race can do at the highest levels of governance

on the planet earth then i think we're in pretty big trouble going forward. i think we've got too many dishonest politicians, who are self-interested and taken with the sort of pop culture aspects of being in politics and we've turned our political life into a pop culture, and too great a degree. and you mentioned the other cultural issues, i think that we, you know, a lot of people, myself among them see our pop culture taking us in a direction that doesn't, you know, take us down the path to prosperity either. i think in a lot of different ways, economically, the models that we're pursuing, the gdp that we're casually passing along to the next generation as though it doesn't really matter, the selfishness that we see coming out of washington is extraordinary and i think we're just laying track for bad things ahead on a lot of different levels and people recognize that. >> megyn: happy new year. >> yeah, i know. i'm trying, but it's what the poll numbers reflect.

>> megyn: you do not stand alone. you do not stand alone at least the republicans and independents, 55-43. republicans 74-24, but the democrats feel good. 69-28%. okay, thank you both so much for being here. >> thank you. >> megyn: well, coming up a new twist to the drama over a local paper's decision to make public the names of gun permit owners in its region. these are law abiding citizens who just got outed publicly for following the law. up next, we'll talk with a senate senator this is treating the law abiding gun owners like sex offenders. and when congress passed off a series of tax hikes and spending cuts, did nothing about a social security tax increase, affecting over 70% of all americans. so, why is that tax hike not being discussed much today? michael reagan thinks he knows the answer. he joins us live next hour. ♪

♪ i'm working for the government ♪

>> a new twist in the drama over a new york paper's decision to publish the names of law-abiding gun owners in westchester county, new york. the paper has now hired armed guards to protect them, the paper, in the face of the public backlash after they

attempted to publicly shame law-abiding gun owners in the aftermath of the newtown tragedy. now second amendment supporters say what the paper did was shameful and perhaps borders on the illegal. here now is republican new york state senator greg ball and represents some of the the people named and say their privacy violated. thank you for being here. now they went after westchester county and now putnam county and the clerk in putnam county says, no, you're not g>> this is going to be a ft and at some point as elected officials, we have to say enough is enough. this journal editorial board is packed with eight heads to the left of left, the worst of the worst. they've used their editorial page to terrorist, level three sexual predators and people have to understand this isn't about the second amendment, we're talking thousands of people who live private lives, victims of domestic violence, former new york city police officers who put the worst of

the worst behind bars trying to protect and raise their families and exposed in a very public way. >> megyn: with their home addresses in the paper for any former arrestee of theirs to see. >> exactly. we have gotten reports from other states in similar instances, where it has led to criminal actions. i have officers contacting me every single day. the law enforcement community has come together and telling the journal news take this information down. people have to get-- the law was made that allowed this to be publicly accessible is decades old. >> megyn: under a freedom of information act request. >> an foia request. doesn't mean it should be publicly exposed. they've got an interactive map, google earth. >> megyn: it's easy. >> you can go to somebody's doorstep. >> megyn: click on the red dot and zooms you in, tells you where they live. >> imagine being a victim of domestic silence violence and a crazy ex-boyfriend and get a permit to protect yourself and your family and now that nut job can show up to your door,

courtesy of the journal news, are they going to hold themselves-- >> and the story, think about the domestic violence victim who doesn't have a gun, but got out. >> right. >> megyn: and is not listed. and the ex knows where she lives and sees it's not on there. now he knows she's not armed. part of security is not letting people know what your defense plan is. >> yeah, this has back fired in their face. you know, after the tragedy that happened in connecticut, where those people babies were mowed down, our hearts went out and everybody with common sense wants to do everything we can to prevent astrossties like that, but they used that moment in everyday sense to run as far and extreme to the left as they can and in doing this, i think that it's blown up in their face because i have people who are for gun control upset that their neighbor is listed as being armed and protecting themselves. now, the robber has a christmas shopping list of what doors to go to. >> megyn: right. >> that are not protected. >> megyn: who don't have guns. it's as dangerous to the people who don't have guns as

it is to the people who do. the question for you, is there any possible challenge to this. i use today practice law and you can't hold the defendant's right to assert his fifth amendment privilege not to incriminate himself. if the defendant doesn't want to trial, the jury is instructed you can't hold any negative inferences against him and what that several level of protection does, he has the right and when he exercises his legal right, it cannot be used against him to his detriment to shame him or indict him or find guilt. that's sort of what the paper is doing to the law abiding citizens. is there a way of giving nthem a layer of protection? >> i want to applaud the putnam county clerk, she's standing strong and we're saying, the journal can bring their lawyers, you can try to intimidate and bully and until it's over and the people have right to have access to the information and we believe we

have the right to protect through public safety the people of our district. >> megyn: and the people registered with the government as they were required to do to become licensed gun owners and it got thrown back in their face. and the journal says we knew the publishing of the data base would be controversial. and important in the aftermath of the newtown shootings that's the publisher of journal news media group. >> that statement doesn't make sense. >> megyn: now they're doubling down and going off-- they're not sorry. >> no. >> megyn: but i want to ask you this. >> selling more papers. >> megyn: what would the reaction be if the same paper decided to sit outside of planned parenthood on the days abortions are offer and followed any woman who goes into planned parenthood and followed her home and publish her address and said i can't tell you she had an abortion, but she was there on the days abortions were planned. and pornography, this is where they lived and went into a porn shop. do you think, or followed muslims in new york city and i

can't, this is the name of all the muslims who live in new york city, not telling you they did anything wrong, but telling you-- do you think there'd be a different reaction from some on the left? >> i think it's done from the left or the right, it's asinine, they're purely asinine what they did. they need to be held accountable and people should cancel their subscriptions, twice if you can, and make them feel it in the bottom line. and stand not only on the second amendment, but privacy, enough is enough. because look, we have to have a national conversation about gun control. we also have to have a national conversation about control, they used the atrocity to try to shield their actions. lets he have a conversation about personal responsibility. as i understand it, this mother told everybody that you can't turn your back on this kid for one second and take him to a shooting range? that's a tougher discussion to be had. >> megyn: thank you very much for being here. >> thank you. >> megyn: for your thoughts on it. we will be right back with new details on a dangerous health scare. bayer aspirin was the first thing the emts gave me.

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>> we're following new developments today with the health of secretary of state hillary clinton. she's recovering in a hospital in new york city treated for a blood clot lodged between her skull and her brain, brought on, her doctors say, by a concussion she sustained during a fall last month. molly henneberg is live with the latest. >> reporter: megyn, the state department just updated reporters off camera on secretary clinton saying she's working from her hospital room and talking to her staff by phone. other than that, not much of an update. doctors say secretary clinton is making excellent progress and good spirits and should make a full recovery. she remains in presbyterian hospital as doctors monitor the brain clot. clinton did not suffer a stroke or neurological damage

from the clot and the secretary's doctors said in a statement on monday, quote, to help dissolve this clot her medical team began treating the secretary with blood thinners she will be released once the medication dose has been established. it was a rough month of december for the outgoing secretary of state. she returned from a trip in europe in early december and got some type of a stomach virus that left her severely dehydrated and canceled a trip to the middle east and north africa because of it. later in mid december as she was recovering from that virus at home, a spokesman said she fainted, fell, hit her head and got a concussion. didn't go to the hospital, but canceled december 20th testimony for the benghazi, libya attacks. the secretary did go for a follow-up exam on sunday and the doctor found a blood clot and secretary clinton was admitted to the hospital on that same day where she remains now, megyn. >> megyn: molly, thank you. well, despite the fiscal cliff

deal and the political war over raising taxes, nearly every working american will see a 2% tax increase in their paycheck. and michael reagan today is asking why that tax hike on 70 plus percent of the country is not the big headline today and he'll join us with his take on it. and questions starting to surface last may about the alias e-mail accounts being used by the top woman at the epa. one of which was later connected to her, that's-- it's epa chief lisa jackson, outgoing now. the epa inspector general took up the issue and ms. jackson resigned her post. what happens now with the investigation into richard windsor, secret e-mail name? [ male announcer ] alka-seltzer plus presents the cold truth. i have a cold, and i took nyquil, but i'm still "stubbed" up. [ male announcer ] truth is, nyquil doesn't unstuff your nose. what? [ male announcer ] it doesn't have a decongestant. no way. [ male announcer ] sorry. alka-seltzer plus fights your worst cold symptoms

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>> fox news alert. less than 24 hours after congress resolves the fiscal fight that was months in the making, we're getting word on a new spending battle already on the horizon. welcome to a brand new hour of america live everyone, i'm megyn kelly. fears of going off the fiscal cliff may be over, wait until march when the treasury secretary calls on congress to increase the debt limit. chief white house correspondent ed henry live from the white house on that. hey, ed. >> reporter: great to see you, megyn, happy new year. the bottom line, the president was very quick last night to come out and sell this deal as a victory and no doubt he had a win in the sense that what

he wanted in terms of tax cuts for the middle class at least on paper, went through tax hikes for the rich, that went through and there were barely any spending cuts. something the house republicans were pushing for. they didn't get that. the president kept that to a bare minimum. when you look at the fine print on this from the tax policy center the white house and obama campaign cited a lot during the last presidential campaign, they say 77% of american households were actually now faced higher federal taxes despite this deal, that's largely because the deal did not include an extension of the payroll tax cut as you know. so a lot of people are actually going to see their paychecks go up despite this deal. as you noted the other big challenge for the president moving forward is that he'll be hitting the debt ceiling shortly and when he came out last night, he said he's willing to compromise with republicans on deficit reduction in the days ahead and immediately said, he will not compromise on the debt ceiling, take a listen. >> and while i'll negotiate

over many things, i will not have another debate with this congress over whether or not they should pay the bills that they've already racked up through the laws that they passed. >> reporter: now, the president is already back in hawaii rejoining husband family for the rest of the new year's holiday. the bottom line, we basically hit the nation's debt ceiling on december 31st according to the treasury secretary timothy geithner. he informed congress that have about a week ago. he said, though, that he took extraordinary measures and will continue to do that in the days ahead to free up about 200 billion dollars so that we will not literally hit the debt ceiling until late february, early march, as you said, megyn, but the bottom line, the white house position, they he don't want to negotiate this out because they think it ends up hurting the economy, this debate whether or not we're going to default on our debt. the republican view, as you know is, this is the only thing they have in terms of lifting the debt ceiling that leverages and forces the

president to give more in spending cuts in order to get a lift in the ceiling. he said last night he doesn't want to debate about it. the republicans are insisting he will get a very robust debate about it. >> megyn: i don't understand how he can say that. he has to have a debate about it if the republicans insist on it, does he not? >> their view inside the white house, if you go back to democratic and republican administrations, usually this was a fairly routine business, i should say. >> megyn: but no more, no more and now in today's modern reality doesn't he have to have a debate with the house republicans if they insist on it. >> reporter: there's no doubt about it, the equation has changed because we are much deeper in debt than we were in past republican, past democratic administrations. so, there is going to be a debate about it one way or another. he doesn't want to negotiate with the republicans on it and say i'll give you this and you give me that the way he did in recent weeks. you're right the republicans are going to push him and say you have to negotiate this, because they believe holding this over the president's head is the only way they're going to get more spending cuts. so the president believes if

it's held over his head it's actually held over the head of the economy and what we saw a year and a half ago when it was debated out, it hurt the economy. and we're likely to have a debate whether the white house wants to or not because we're see v so deeply in debt and this deal last night doesn't include any spending cuts so there will be a robust debate. >> megyn: and added 4 trillion to the debt. >> the next years. >> megyn: thank you. and a clash over a hurricane relief bill. we're monitoring a new jersey-- a news conference i should say from new jersey governor chris christie about the house delaying action on the superstorm sandy aid bill. some republican lawmakers say ' portion of the multi-billion dollar legislation actually goes to the victims and they believe the rest is filled with pork. they say it's unrelated spending, including items like 150 million dollars in funding for alaskan fisheries, that's

not slowed down the latest attacks on the g.o.p. listen. >> everybody played by the rules, except tonight when the rug was pulled out from under us, absolutely inexcusable. indefensible, we have a moral obligation to hold this vote. >> mr. speaker, we cannot turn our backs on our citizens who need us. >> i have to go home and tell them their new years gift is that they're going to wait even longer, even longer for something they should have had over a month ago. >> ithis is an absolute disgrace and the speaker should hang his head in shame for not allowing this to come up. >> megyn: shannon bream is live in washington. that was democrats and republicans bashing the republican leadership for not allowing a vote on this bill, but they say they have a good reason for not doing so. tell us more. >> they do, well, megyn, house republicans who opposed the quick passage of that sandy aid bill are getting blasted from both sides of the aisle, but lawmakers like darrell

issa say bring it on, they were never going to vote for a bill they say is full of all kinds of pet projects that have nothing to do with those devastated by the superstorm. >> the fact is the senate didn't do their job. they sent us a bunch of pork and left town and that was just wrong and i think the speaker has the support of a vast majority of republicans. >> reporter: critics of the 60 billion dollar senate bill i was going to be broken into two separate house votes, a 27 billion dollar primary bill and a 33 billion dollar amendment to that bill was loaded with pork. they point to 600 million dollars for the epa to support climate change issues, 348 million dollars for the national park service, 188 million for amtrak, and 8 million dollars for new cars and equipment for the justice department and homeland security among other things. the supporters of the bill say house majority leader eric cantor was with him all along, still is, and they're pointing the finger of blame at speaker john boehner, openly encouraging the idea that

there's a rift between the two. >> there's a squabble, obviously, between speaker boehner and leader cantor, they voted separately on the fiscal cliff. since cantor had taken a lead role here some have speculated that boehner wasn't as friendly to it as he might have otherwise been. >> reporter: cantor's office tells me that the two are in communication and that cantor support the speaker boehner. the two are scheduled to meet with the new york and new jersey delegations to discuss sandy aid in less than an hour, megyn. >> megyn: shannon, thank you. >> we're going to hit every single recommendation that's been put forward. some individuals have been held accountable inside of the state department and what i've said is that we are going to fix this to make sure that this does not happen again. because these are folks that i send into the field. we understand that there are dangers involved, but you know, when he read the report and it confirms that we had already seen based on some of

our internal reviews, there was just some sloppiness. >> megyn: well, that was president obama talking about accountability for the terror attack in benghazi, libya that killed four americans on 9/11 of 2012. he made those remarks after a report came out blasting the state department for security failures leading up to the september 11th attack. four state department officials reportedly resigned or essentially forced out in the wake of that report. but now we're getting word that the staffers who reportedly stepped down actually did no such thing. in fact, all of them are still on the payroll. congressman jason chaffetz of utah is one of the critics of the libya attack and expected more resignation is or more people forced out a week or two ago, congressman and now we find out that not only -- that the four we thought were gone are not gone at all. let me tell the viewers what we know. eric bozwell, he's assistant secretary of state for diplomatic security, said he

resigned, no, he shifted his desk. it's basically a desk change and three others, charlene lamb, raymond maxwell and some other unidentified person they've been placed on administrative leave. that's not, they're not getting fired, coming back after a little leave. is that true? >> yeah, i mean, that's a paid vacation as far as i'm concerned. it looks like more of a reward and a bonus for a job-- look, we've got four dead americans. we've got three people who were maimed and injured in that fire fight. and no accountability. you had an internal review done by the accountability review board and they found more than two dozen systemic problems and challenges, and changes -- or challenges, and 60 recommendations, that place was an absolute mess and disaster and we have four dead people and not one person held accountable. we haven't caught the terrorists that did this. in fact, the only person who is in jail is the person who created that video which we know now had absolutely

nothing do with-- >> what's your observation, congressman these folks, the initial reporting that they had resigned and there was a lot of reporting on that before the christmas break that they had resigned and now we find out they haven't resigned they're all still getting paid by the taxpayers, and state department. one desk shift and a few on administrative leave and including duties, including charlene lamb, the one who told your colleague congressman issa, that the security was adequate on that day. >> well, but it starts at the top. when you hear the president of the united states say, well, it was just sloppiness, well, you have dead people. you have hundreds of embassies in c and consulates, and review board finds more than two dozen systemic failures? i mean, i don't -- and then nobody's held accountable, nobody's resigned. it's just like we saw, quite frankly, in fast and furious, nobody was really held

accountable in that situation as well. it just seems to be a pattern and when the president of the united states says, well, it's just a little sloppy, you can see where that radiates down into the bowels of the organization and nobody is held accountable. >> megyn: well, but i mean, apparently these people were found guilty of inadequate performance, but not willful misconduct. does that make a difference to you? >> when you have people dead as a result of your actions, you would think that there would be something dramatic that would change and move in this and then to go out-- see what i have a problem with, the spokesperson for from the state department led the world to believe there were four major changes and how somebody resigned and she actually used the word resigned you, but they didn't. again, they misled people into believing they had made all of these changes, all is well at the state department, but that's simply not true. >> megyn: well, bosswell resigned his post as assistant secretary, but he's continuing his own duties at state. so it's basically just a title shift for this guy bozwell.

there's a question whether that lives up to hillary clinton's statement that she takes responsibility for what happened in benghazi, the buck stops with her. the question, do we expect this to be the end of it? i mean, do you think we're going to see more personnel accountability or is this it? >> well, you know, how the state department holds itself accountable, i don't see it because they did that independent review board, the accountability board, but they essentially blamed everybody, which means nobody was personally held accountable. i can't imagine all the deficiencies, all the recommendations and not a single person is fired as a result of it. not a single person resigns in just, you know, hey, i didn't do my job. it's just absolutely amazing and by the way, when the accountability review board did its job they didn't even interview secretary clinton. she's in charge of the departments, they're supposed to go through and looking how these people got killed and didn't even talk to the secretary. it's unbelievable. >> megyn: they seem to conclude it didn't go up to

her level, but the question is, you know, you and i have spoken before about the cables that ambassador stevens sent, including on the day he died. i mean, that they were begging for more security. they were very worried about the growing presence of al-qaeda and the accountability review board concluded that as well. and i mean, i guess a lot of americans will be left wondering who was the person, now, do we know to this moment who was the person who looked at those cables and said, no, you're not getting them. and what's happening to that person? is that charlene lamb? is she going to get her administrative leave, is that paid vacation? is that paid. >> yeah, they're getting paid. spent a we cannot having come to work and getting paid. that sounds like a paid vacation to me. the problem i have on june 4th we were bombed and terrorist activity in benghazi, we were bombed in april and then bombed june 4th. what happened then? how can that not rise to the level of the secretary of state? how can that not rise to the level of the president of the united states.

there were not changes then, people were yelling, screaming asking for more assets. you had terrorist activity going on there, believe me, the oversight committee, chairman issa, myself, others, we will continue to pursue this. this thing is not done. we need to see the information and we expect hearings on this and the foreign affairs committee. we're still going on this. >> megyn: congressman chaf chaf vets, thanks for being here. >> thank you. >> megyn: and what happens to an alias account, i said secret before, it wasn't secret, it was more of an alias account and she claimed it was normal, why is the inspector general of the epa looking into it, why did she really step down? we'll look into it in a moment. first she said she didn't do it and then she says two other people did it. and now she says she did it, but in self-defense and described has a while movie in the making.

>> well, it happened right after christmas and did not get a whole lot of attention, but epa administrator lisa jackson resigned after private e-mail for government business. this kicked into high gear in october when competitive enterprise institute sued the epa after it was denied access to information about miss jackson's use of private e-mail accounts under the freedom of information act. then in mid november, ms. jackson was found to have been using an alias e-mail account under the name of richard windsor. three days later the committees the inspector general with alias accounts apparently not the only time this has happened. last month the inspector general announced plans to audit the epa electronic communications and two days after christmas miss jackson

announces her exit. and joining me the chief counsel for law and justice. welcome to the program. >> happy new year. >> megyn: she says she's leaving for personal reasons, family reasons and spend more time and so on. and the timing has some folks suggesting, including senator david vitter who says she's resigning over this e-mail account with a fictitious name and it's clear to him and many believe he's right. your thoughts? >> well, sure is beyond coincidence. you've got the reality she wasn't-- it's not uncommon to have multiple e-mail identifiers if you're in government, but they're official. here you've got richard windsor, the name of her dog, the e-mail you use to communicate only to very senior level people inside the epa. of course, a lot of the concern has been not only the political nature of what's going on at the epa, but the war on coal and that's what the the citizens independent group was concerned with

initially. and then when you file an foia request. >> megyn: freedom of information act. >> when you don't know the name of the person involved. and you're utilizing this fictitious name to communicate with government officials at the highest levels and then, five months of stonewalling to get the documents and they say they'll release the documents again just like fast and furious, 3,000 at a time. there's 12 or 15,000 documents tells you something doesn't add up here, something doesn't seem right. >> megyn: the other thing is that the group-- >> she's resigning, but, boy, something is not right here. >> megyn: the other thing that the competitive enterprise institute, when we file a freedom of information request between lisa jackson and say, the white house we are going to do it at the epa and white house, too, and we want responsive documents from both bodies. the white house in doing its search may just search for lisa jackson. the person who gets pass $with just responding to an foia request may not know that dick windsor happens to be the dog

of lisa jackson and her alias and they have real questions whether this is the way that government should be running. >> i mean, think about this for a minute. why in the world, if you're the chief administrator of the agency and would you utilize the name of your dog if it wasn't the intent to deceive? and you're exactly right. moist foia accounts, freedom of information act requests we want information from person x in communication with person y. now we have to put in the foia requests and aliases they go by. this was not just another e-mail address, this was utilizing the name of her dog to communicate with high level officials within the epa and only high level officials within the epa. so it just does not add up. and megyn, it goes to the whole idea that president obama said when he was running the first final in 2007-2008, this era of transparency and he wants a transparent administration and then you've got situations where the department of justice is

communicating with media matters recording fox news. you have now the epa administrator using her dog's name to communicate withster officials of the epa regarding official policy positions of the agency. this just is not the way it's supposed to work. and i'm glad there's an inspector general coming in and doing this investigation, and it's sure-- >> what happens the investigation-- now she's leaving. >> and she's announcing she's gone. >> megyn: now she's out of there and the new york post is reporting she's leaving because she thinking that president obama will green light the oil pipeline. and not confirmed. and princeton university, that's not confirmed. her people are saying, family reasons and sticking with that. and now what happens with the alias e-mail account now that she's done. >> individuals that asked for the foia are going to get it. and the e-mails were sent to other people and probably going to broaden out of inspector general's report and acknowledge if in fact there's determination made that

there's a violation of the rules of communication and there are set rules of communication by high government officials with regard to e-mail access, utilizing private e-mails for person or for professional and really governmental responsibilities, that violates the law, unless you have a very specific tracking mechanism to determine where those e-mails are. of course, here, only a handful of people knew there was a richard windsor account. you know, megyn, it's just not right. you fundamentally, i think it was violating the regulations regarding the e-mails and we'll find out that soon enough, but this just, utilizing your dog's name the heffed the epa, you can do b better than that. >> megyn: thank you. congress approved the fiscal cliff bill, the attempt to avoid the fiscal cliff. and it headed off tax hikes, but increased 70% of th the country.

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. >> new outrage after-- i should say relatives of the victims of the colorado movie massacre are invited to attend the theaters reopening. 12 people died and dozens more were injured when a gunman opened fire inside the aurora theater back in july. well, now relatives of nine of the murder victims are releasing a letter they sent to the theater's owner rejecting an invitation he sent them to attend the theater's reopening, calling the offer, quote disgusting and the timing awful. invitations arrived apparently two days after christmas to attend an evening of remembrance followed by a movie. the company that owns the theater had no comment.

well, amid the back and forth over the sandy relief bill and the controversy over how much in that bill is actually ear mack marked for the victims, we want today bring you the story of a family hit hard by the storm and two months later have gotten very little help. our affiliate has the story. >> the acosta family have been living in this holiday inn hotel room more than two months. sandy's flood waters took out two floors of their freeport long island home and the water line in their kitchen tells the story of the destruction. the insurance company claims they only have $29,000 worth of damage. veronica says that's barely enough to cover demolition let alone repair and the families are running out of options. >> my message to all of my elected officials is, you made a promise, you gave your word that you would help us. and i'm asking you to help us. i'm here trying to get back to my home. i have a child that asks me on

a daily basis when can i go home? and i can't continue looking at him and saying, we're almost there when we're not. >> fema has been paying for the acostas hotel room and so far denied their request for further funding. the long island family will continue to petition of insurance company for more money to begin repairs, again, they were hit by hurricane irene as well. >> we just actually finished completing at the ends of august, from irene and now we have to do this again. >> the acostas have sought help from numerous relief organizations, but veronica says she hasn't seen a penny. >> the red cross, why are you guys? why haven't you called me back with help. the united way, the robin hood foundation who raised millions of dollars on behalf of sandy victims. where is the money? who is getting that money. where is the signup sheet? >> we called their insurance company about their case, but

could not get a response. the acostas say so many people are talking about helping sandy victims, they're wondering why none of that relief has made it to their neighborhood in freeport, long island. >> megyn: just, it's so easy to move on with your life and forget with these victims are really going through. and our thanks to adrian, with our new york affiliate for that report. the best to that family. and congress just voted it head off a series of tax hikes and spending cuts, but left in place, a 2% tax increase, that will likely affect you because it's going to hit about 77% of the country. why is that not being discussed more today? michael reagan thinks he knows. he's here live next. and at first, this woman said she didn't kill her boyfriend at all. then she said two masked inuders did t she said all right, it was me, i did it in self-defense and now she's facing the death penalty as opening statements get underway today in a brutal, brutal murder and the trial

that's being called a hollywood movie in the making. kelly's court takes on the case. >> i've done many things that are shameful, but this is not one of them. yeah. mm. some laxatives like dulcolax can cause cramps. but phillips' caplets don't. they have magnesium. for effective relief of occasional constipation. thanks. [ phillips' lady ] live the regular life. phillips'.

>> new numbers show the economy may be ringing in the new year with new momentum. hiring and manufacturing were both up in december, a sign that factories may be adding new jobs and may even be signs of expansion. it's a real turn around from november when both numbers

fell to three-year lows. there are still concerns that consumer spending could slow down still this year. well, it may be the one story that's not getting a lot of attention today. 70 plus percent of the country will have less money in their paycheck this week because a 2% break in the payroll tax has expired. in other words, you got a tax break of 2% and they just took it away. you haven't heard much about it today, why not? michael reagan thinks he knows, he's chairman of the reagan group. welcome back, the government giveth and take it away. they said a federal tax holiday and everybody has to pay this, it's on your paycheck and it's 2% and we enjoyed it for a couple of years and now it's gone. so, why is this a big deal? >> yeah, it is gone. you know, watching congress is like watching david copperfield in las vegas, the magician. they have you aimed at looking at 400,000, 450,000 people who

are going to get taxed more and isn't that wonderful they should be paying more taxes. while you were looking there, they voted to raise taxes on anybody and everybody who in fact gets a paycheck, who pays to fica, which is everybody. and you're going to see your check this week is going to pay you 2% less than what you got the last week of december. now, i wonder how that's going to go over with the american people? and i have to tell you if it was a republican president, in fact, in washington d.c. that was taking off for hawaii to finish a vacation, the headline would be republican president, republican congress vote to raise your taxes, the bill they passed in the last couple of days in washington was a tax bill. it wasn't a fiscal cliff bill. it was a tax bill. the fiscal cliff got kicked down the road for two more months. call it what it was, a tax and spending bill. >> megyn: it increases income taxes, obviously, for those making over $400,000 or 450 if you're a family.

it increases tax rates for capital gains and dividends from 15 to 20% on people 0 who make more, and increases the estate tax and when you die and want to pass things to your offspring, 5 million, you don't pay 35%, you may 40% in taxes and on and on go the tax increases and they say, basically 620 billion dollars in new tax hikes for 15 billion in spending cuts. $41 in revenue for every $1 in cuts. there are no cuts, it's all about revenue, but the good news sthe good news is, the cuts are coming, michael, they're now going to get serious and i point you to the senate majority leader, mitch mcconnell, listen. we've got it on tape. >> now it's time to get serious about reducing washington's out of control spending. that's the debate the american people want. it's the debate we'll have next. and it's the debate republicans are ready for.

>> megyn: don't worry. >> megyn, all i can think is this is conjuring up my father for a moment. he would say, there they go again. >> megyn: and it's a lofty ideal to find spending cuts, but why are we supposed to believe that those spending cuts which were unattainable when republicans had a tiny bit of leverage, are now going to be more attainable when they have no leverage? >> yeah, the best that's going to happen is they will cut, you know, spending, the growth of spending, they will not go out and actually cut spending in washington. it's going to go up. what do we already know? we already know that over the next few years, the debt's going to raise to 20 trillion dollars. >> megyn: thanks to what they passed on december 31st. >> yeah. absolutely right. so, again, we are the ones being fooled out here. they're the ones not doing

their jobs and the audacity of the president of the united states last week would sign the executive order and give everybody an increase who is a federal employee, of course they threw that out last night, but the rally the president signed an executive order to give a pay increase. again, they throw it back in our faces. they say they're going to have a fiscal cliff piece of legislation, they don't. they have a tax bill they in fact throw at us. what i did today i woke up this morning and fired my pool man and i'm going to start growing algae in my pool so i can get part of that 59 million dollars. >> megyn: and use it to power your car in california. >> absolutely. the car i buy, right? >> and do you see an inconsistency in the philosophy of raising the taxes on the rich and because there was -- well, there was a discussion about whether they should do that, right? because is that going to slow growth to raise taxes on the rich, but they've also raised taxes on the middle class by revoking this payroll tax holiday and so, is there, i guess, the question i want to

ask, do you see growth likely to slow because they have taken money out of the pocket books of not just the rich, but middle class as well. absolutely right. that's a new washing machine, that's a new refrigerator. that's a new, maybe, flat screen television. those are the things those people go out and buy. maybe gas for the car or whatever it might be. yes, the economy is going to slow because they're not going to have as much money to be able to spend out there in the public. but you know something? they don't even know what's going to happen to them until they get their paycheck. i ran a survey and ask you to run a survey, people who work at fox on your show. how many of them are aware that their paycheck is going to be 2% less than it was last week, and nobody was aware of that and they won't be until they get the check, what the hell happened, i thought they raised taxes on the rich people? no, they raised taxes on you. >> megyn: a lot of companies, a standard raise of 5 percent

6%. and it couldn't last forever. i think a temporary holiday doesn't go on forever. they put it in place i think in 2010 to help us through a difficult time and put more money in the pockets of american people and go out and spend more and stimulate the economy, but paul good things must come to an end and that tax is supposed to be i guess to help fund social security. that's a discussion of the day. >> that's right and-- >> it had to end sometime. >> yeah, right, and the president of the united states though for the last two years had been selling this to the middle class as his largest tax cut in american history and he's the one that gave it to the middle class. so he sold it as a tax cut so to put it back in you have to sell it as a tax increase if it was pre-sold as a tax cut. most people didn't see it they just saw more money coming into their paycheck and didn't understand the process because most people don't who get those checks, they see it and see what my net pay is this week they're going to notice

2% less in their paycheck and ask the question, how and why. and the how and why is exactly what we in fact are discussing. >> megyn: yeah. >> they wanted to shore up social security, they wanted to get more money into washington and guess what, the extra 2% goes to social security. but who robs the social security trust fund? the congress of the united states. >> megyn: you've got to love it or hate it. laugh or cry. let's across to laugh. >> business. >> megyn: michael, thank you. >> thank you, happy new year. >> megyn: happy new year. up next, a murder trial going on in arizona, opening statements today for a woman who first said she didn't kill her boyfriend. then she said two masked intruders did it. but then she said she did it and did it in self-defense. and that's next on kelly's court and why this murder trial is getting national attention. >> i have to ask you this, did you kill travis? >> i did not. no, i had no part. i had to have honest and the evidence is very compelling, but none of it proves that i committed a murder. none of it proves that i committed a crime. i would be shaking in my boots

right now if i had to answer to god for such a heinous crime.

. >> kelly's court in back in session. on the docket, a high profile murder case and a defendant who keeps changing her story. this death penalty trial just got national attention in arizona for a woman accused of brutally murdering her husband. they're saying that she shot travis alexander in the face

in 2008 while he was taking a shower. in addition, they say she then stabbed him over 20 times and slit his throat ear to ear because he didn't want to be with her. she's pleading not guilty saying she didn't do it initially and then changed her story saying well, two masked intruders did it and she changed the story and said she did do it, but did it in self-defense, all different from what she said in a jail-house interview after she was arrested. >> i have to ask you this, did you kill travis alexander? >> i did not. no, i did no part. i have to be honest, the evidence is very compelling, but none of it proves that i committed a murder. none of it proves i committed a crime. i would be shaking in my boots right now if i had to answer to god for such a heinous crime. >> megyn: let the shaking begin. joining me now is defense attorney and also a former

prosecutor, panel, welcome. >> good morning. >> megyn: the evident against her looks overwhelming, looks overwhelming, but she is being represented and she'll mount a vigorous defense and the whole nation is starting to watch this, it's been getting national attention, inside edition and many national broadcasts had scored interviews with this moron, i mean, woman, who spoke about her ridiculous defense and its evolution. but i want to ask you, to make the case that the prosecution is going to make. >> the prosecution has an easy job, megyn, here is the thing, number one, she changed her story three times. number two, there's evidence that was found in the victim's dryer of a picture after digital camera with pictures of her at his house having sex with him prior, the day that he was murdered and then, guess what? pictures of the murder scene. >> megyn: no proof that she took the pictures of him dead that day. >> but that's true, come on, you know that the jury is going to connect these dots fairly easily, there's no-- where are the masked intruders

that she was talking about. they don't exist, then she says listen, i killed him in self-defense, 27 stab wounds that's not self-defense, that's psycho, that takes a lot of strength and anger not a self-defense case. >> megyn: david, first she wasn't there at all and then she said i was there, but they came out and said, a bout with honesty, found a bloody print inside of him home that belonged to her and dna typing results indicated that the bloody print was a mixture of her blood and-- her dna and his dna had her debt to rights at the scene and only when that came out did she change her story, okay, two masked intruders came in and shot him and let me make a run for it. and then they he come out with the camera that was found in the washing machines and somebody took, you know, first it was her naked having sex with him and then it was her taking pictures of their-- or somebody taking pictures of a dead body and then changed it to i did it, but did it in

self-defense. >> megyn, uphill battle extraordinare, and then again, so was casey anthony and look where she is. go on self-defense theory and guess what, we're going to see her take the stand and absolutely no choice in this matter. she's got to establish a burning bed defense. a history of abuse, tro's, police reports, witnesses who saw abusive behavior and then got to put together a credible story of what happened in that bedroom, perhaps getting attacked, over and over, him getting in the shower to clean off. she then couldn't take anymore so she shot him and then berserk in some sort after crazy panic and stabbed him to make sure he was dead. this has got fob an emotional powerful, and credible presentation by her in order to get anything and megyn, guess what? she's going to get convicted, the only question, first

degree murder, second degree murder, heat of passion, maybe even voluntary manslaughter which would take the death penalty off the table. >> megyn: that's obviously what she's hoping for. and her sister said, yes, she lied in the the initial stories and the reason this man was a monster she was in love with and trying to protect his reputation and she claims he was a pedophile, that's been completely debunked by the prosecutors and say she forged documents to try to proof that. in any case, she says he was a monster and wanted to protect the world from knowing that she was in love with and the prosecution will have stalking, obsession and prior violent incidents on her behalf? >> yeah, and how about the evidence that she lived in entirely different state from him and had to drive hundreds of miles to go visit. she did eventually move closer and then she moved back to california you know what? if you're so afraid of somebody, if somebody is so

brutal to you, you don't get in your car and drive across state lines to go have sex with him. that just doesn't happen. so, again, prosecution's going to have a field day with this one. >> megyn: she slashed his tires allegedly before, but when i saw violent incident the slashing of the tire. there isn't proof that she tried to hurt him before or anybody else. >> no. >> megyn: the question, 27 times, slit from throat to throat, and shot in the head and there's an uphill battle for the prosecution to convince the jury that a woman with no history is guilty of that? >> yeah, i think there is, megyn. she has no history of this kind of psychotically violent behavior so they'll think there's something more here and what is it? what don't we know about the history of this case and she has to come up with, as i said, evidence that there was some sort of abusive behavior, megyn. >> megyn: in the casey anthony trial they had to try to play that card and had nothing exempt for speculation of the defense attorney and hold on, sound just in from the

prosecutor in the opening statements, listen today. >> okay. >> this is not a case of whodunit. the person whodunit, the person who committed this killing, sits in the court today. the defendant. and an individual by the name of travis victor alexander. a former boyfriend of hers. an individual that she was in love with. an individual that was a good man, an individual that was one of the greatest blessings in her life and this love, well, she rewarded that love for travis victor alexander by sticking a knife in his chest and a good man according to her and with regard to being a good man, well, she slit his throat as a reward for being a good man. and in terms of these blessings, well, she knocked the blessings out of him by

putting a bullet in his head. >> megyn: jonna, you've been in front of-- >> i've got a problem with that, he said she rewarded him by slitting his throat. and that doesn't make sense to jurors and hurting his case by making that opening statement, and domestic violence case. >> no, he's using what she's going to try to use against her. she's going to come across as a sweet, pretty, thing ever and oh, my gosh, he was-- that's how you reward somebody you love, that's what he's doing, dinging her now because that's coming out later. >> megyn: for a time she represented herself and she tried to introduce some alleged letters proving he was a pedophile, and the prosecution said they're blatant forgeries, and the judge said young lady you're in over your head and the they're not coming into evidence and now she's obtained court-appointed counsel. panel, thank you. we'll be right back. >> thank you, megyn. instead i got heartburn.

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>> a photographer killed by oncoming traffic in los angeles. he was trying to snap a picture of justin bieber's white ferrari. the singer was not in the car at the time, but tmz reports the paparazzi had been following bieber all day. one of the photographer's friends spoke out after the accident. >> i came to pay respects to him because he was just a kid. and i know some people will say, another crazy paparazzo trying to make the money. actually he was not paparazzo, he was just another kid from new mexico. >> megyn: justin bieber released a statement saying while he was not directly involved in the accident his thoughts and prayers are with the family of the victim. bieber adding he hopes this tragedy will finally inspire meaningful legislation to protect the lives of

celebrities, police officers, innocent bystanders, and the photographers themselves. this looked like the 112th congress will adjourn without approving emergency funder for hurricane sandy victims. highlighting how hard it can be to get financial support when disaster strikes. that difficulty is paving the way for a new industry, companies that will come to your home and document all of your belongings, which could be a huge help if disaster does strike. alicia acuna in denver with the details. hey. >> reporter: hi, megyn. insurance companies will give you forms to fill out inventory of your home, but a lot of times people forget or simply leave important items off their list. that's where home inventory comes into the equation, and these are companies that will meticulously record everything of value. here is how it works. they come in and take a list of serial numbers and photos and make a list and they own an inventory in colorado springs san says when people try to do this themselves,

they forget about a lot of items. >> tools and things, and so, those are the things that people don't realize how much money and how much value. when something's a total loss like these fires that we had, you have to replace every single thing, you know, tupperware, toothbrushes. >> think about the people who had to leave their homes in the rush as hurricane sandy approached and how many are still attendant to go rebuild today. depending on the company the inventory list can go on a server, flash drive, cd, cloud, you name it and when home owners are faced with disaster they don't have to rely on memory or worst face doubting insurance companies. >> a lot of times the insurance companies would, you know, question what you did have and what the value was, and if you have pictures of it, plus, you have you know, a serial number or whatever, then they can-- you can track it down to what those were, you know, cost at the time. >> the average cost to do this is about $550, depending on

the size of your home, megyn. >> megyn: thanks, alicia. we'll be right back. hi. i'm henry winkler.

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