you all are going to sing another beautiful son for us. >> steve: fantastic. >> brian: thanks for watching. make sure you stay tuned for "america's newsroom." if you got to run from the tv, go to the radio. >> steve: we'll see you back here, same time, same channel. so long, everybody. fox news alert now. await comments from all sides on the stalemate on the payroll tax cut fight. house speaker john boehner expected to hold a news conference momentarily immediately followed by democrats. later at noon eastern the president has his word on this. if there is no deal, 160 million americans see a drop in their paychecks starting in january. merry christmas. good morning, everybody. i'm bill hemmer. how are you doing? martha: i'm doing well. good morning, everybody. i'm martha maccallum. $40 is what it shakes out to. the white house says that will be shaved off the average paycheck in this country if all this does not

go through by january 1st. bill:. we don't know how this will play out there. is a lot of drama three days before christmas. the senate accusing house playing chicken with your money. house republicans saying they will not back down. >> we're here and we're ready to go to work. we're hoping the senate democrats will appoint negotiators, come to the table and resolve these differences. >> the republicans have walked away from solving serious problems. this is not a game. bill: mike emanuel is live on the hill again today. he hasn't left his perch. where does this thing go today, mike? good morning. >> reporter: good morning. we expect the house republicans to make the case in about an hour essentially the two-month extension that passed the it. >> senate is bad for jobs. they will focus how it creates more uncertainty for employers and logistical problems highlighted by the international payroll consortium that said essentially it would cost a lot of money, create a lot

of havoc for companies changing computer systems for two months alone. we heard from another house republican a little earlier. here's what he had had to say. >> we need the senate and specifically the democrats to come back to washington to do the jobs that they were elected to do and work this matter out. there is still time to do it. but a publicity stunt on the floor of the house was not helpful. >> reporter: of course house democrats will step to the podium after speaker boehner and his team. we expect their message, pass the senate bill now. stop focusing on process. get this done for the american people. bill: senators are back home or in the caribbean despite calls from republicans to come back. harry reid has not made the call. what about the democrats and what are they saying, mike? >> reporter: it is interesting. i talked with a house republican. had candid moment off-camara with him. are you going to get a deal? i think so but i think the democrats are also enjoying exploiting this issue heading into an election year. we heard from one of the leading democrats in the

u.s. senate yesterday, chuck schumer. here is what he had to say. >> i will bet you dollars to doughnuts if it is put on the house floor which speaker boehner has thus far refused to do, it will pass with not 219 votes, one more than necessary but 50 or 60 votes more than necessary because a large number of republicans will vote for it as well. >> reporter: we expect house republicans to say this is bad for jobs. a two month extension. we need a year. we know the speaker asked president to call senator reid to bring the senate back. he has not. we expect the house democrats essentially to say pass the senate deal now and let's move on. bill: you had a good one, mike. we'll talk to karl rove in minutes about this too. mike emanuel leads our coverage on the hill. here is martha with more on this. martha: here's the deal. if there is no deal before the 1st of january the paychecks out there will shrink, folks, for about 160 million americans. the social security tax increase will go from 4.2 to

6.2% taken out of your paycheck. that amounts to about $20 a week for someone making $50,000. and it would also impact unemployment benefits for two million americans as well as part of this deal and medicare because doctors could see big cuts in the payments they receive from medicare. all of that wrap understood this deal. no deal. that's the way it looks. bill: just so you know, we're waiting for more reaction. lawmakers on the hill will be before the microphone momentarily. john boehner, republican leadership speak at 10:00 eastern time. immediately followed by the democrats. the president will come out around noon eastern. we're keeping an eye on all it today. we'll bring you the news as it happens live from the hill. martha: how about this? brand new jobless numbers have just been released. this number looks a bit better all the time. these are the numbers, fell about 4,000 in terms of the number of people who walked in and filed for new claims. it is better, the new number,

than economists have been looking for. it is lowest numb before we've seen in three years in this country. stuart varney, anchor of the "varney & company" on the fox business network. >> good morning, martha. martha: the chart does not lie. this line is going down. >> okay. i don't want to burst your christmas week bubble, yes, it is true, 364,000 is well below that 400,000 mark and the trend is good but it's still a very high number. so we still have a somewhat shaky recovery. furthermore, we just got numbers on the ratate of economic growth. it is only 1.8%. that is a very weak economy. 1.8% annual growth. that does not make it at this stage of the recovery. one more thing. even "the new york times" today spells out that we could weaken further in the early part of the new year. you've got europe a problem. gas and food prices are a problem and unease and uncertainty over future spending, tax and regulatory

policies coming out of washington. martha: yeah. >> it is a disappointing big picture, martha. martha: i saw the story in the "new york times." one of the things they point to in the piece as perfectly louse for the economy beginning of next year if they doesn't pass the payroll tax extension program in washington. they feel that will take a bite out of people's paychecks and won't be good for any recovery we're smifing out right now. >> you got that right up front. if there is no payroll tax holiday extension and no further extension of inmany employment benefits you're taking money out of the economy. that may affect growth. the times has it up front another reason why we might slow a little bit more in the early part of next year. martha: stuart, thank you. christmas cheer. burst my bubble. good to see you as always. >> humbug. bill: one. few states to see a drop in unemployment, not a big drop but a drop nonetheless, the great state of ohio. so what are they doing right? we'll talk to the governor,

john kasich, about that. martha: and how about this, folks, a political smackdown going on between mitt romney and newt gingrich. the two candidates trading barbs after a series of ads attacking gingrich flooded the airwaves in iowa. romney says they are funded by a super pac not his campaign so he can't do anything really about those. gingrich tells's fox's greta van susteren he could really have them taken down if he wanted to. and he does if the ads are simply false. >> one of his ads this morning got four pinnochios from the fact checker at "washington post." very hard to get four pinnochios in a 30 second ad. that means nothing is true. >> that is long nose. he challenged romney to a one-on-one debate. this something is he pushed throughout the whole process. he hopes to have that against the president as well. we'll see. bill: a good line. a wave of deadly bombings

rocking baghdad, the same week that u.s. troops departed that country. [sirens] the latest word at least 60 dead and what appear to be aing and well-coordinated attack. amy kellogg has been watching all this out of london. who was the target this time, amy? >> reporter: 160 wounded, bill. those numbers are quite fluid. these attacks happened mostly in shiite neighborhoods but also in some sunni neighborhoods. regular people were the targets of these attacks. one was a suicide car bomb with an ambulance laden with explosives that blew up right outside of a hospital. another bomb targeted workers who were lined up waiting for jobs. another attack happened outside an anti-corruption office. these attacks apparently coordinated. they're all the hallmarks of al qaeda attacks. some are saying this is the worst violence in baghdad in a year. as you mentioned, bill, five

days after the u.s. forces finally pulled out of iraq. bill: remarkable to watch. why are they happening now? is there a reason? what are you hearing? >> reporter: many say absolutely no coincidence these happened so shortly after the withdrawal of u.s. troops which had been known about for a long time but there is also the other nightmare scenario many are feeling that the sunni-shiite violence may be exploding again out into the open. the power-sharing taking place in iraq is extremely fragile and yesterday the prime minister, nouriel maliki, put out an arrest warrant for his sunni vice president accusing him of being behind terrorism, carrying out terrorist attacks or planning them. so clearly, malaki being problem is among many people's minds and there may be some connection. bill: the future is still unsure. amy kellogg watching events out of london. thank you, amy.

10 minutes past the hour. martha: very tough situation. a lot of people warn that this may be the way it goes. didn't think it would be quite as quickly as it has. let's take a look. those are a few of the stories in "america's newsroom." how about this one? she was stuck in a snow-filled dutch for 10 days. we'll tell you how this college student survived to tell us what happened. bill: a game of chicken on the hill. karl rove in minutes. what he thinks republicans should do now. we'll ask him moments away. martha: he may not be running for president but chris christie keeps in close contact with mitt romney. i will ask the new jersey governor if there could be a bigger role for him in 201. >> we have a very candid relationship with each other. he calls and we talk all the time what is going on in the campaign. he asks for my thoughts and i give them to him. >> have you talked about a vice-presidential role for you? if you have high blood pressure, like me,

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taking new heat for failing to pass the senate-backed payroll tax cut extension. my next guest says the republicans should pack it in, give in to democrats and live to fight another day. that guest is karl rove, former senior advisor and deputy chief of staff to president bush and a fox news contributor in his home state of texas, austin, today. good morning to you. bit of a surprise reaction. what do you mean? how do they get out of this? >> i was asked to comment on "the wall street journal" editorial on the subject and i think the journal caught it right. republicans are finding themselves in a place where they look like they're opposed to keeping a tax cut in place and in favor of letting tax rice. let's step back. this is political maneuver by the president. it is political maneuver by harry reid. we have to tip the hat to cynical, political effort that they have undertaken to jam the republicans, to basically give them a bill that is unacceptable and depart town. the republicans in the house

are in a place where they have got two choices. they can stand firm on principle and say this is bad for american working people, bad for the economy. just to have a two-month extension. we ought to have a year-long extension and look bad because it ain't going to get extended. the taxes will go up january 1 and president and democrats will blame them. ordinary working man and woman will say, hey, there is $40 less in my paycheck. why didn't members of the congress come to agreement on this. looks like republicans doesn't want to do it. bill: if you look down the road it will come back up and again republicans say turn around, we told you so. we're back at the table. >> exactly. that's fine. do two things. one today, blame the democrats for not doing the right thing and for leaving town. wait until president obama flies off to hawaii and take the floor of the house saying we were willing to sacrifice our holiday and in order to get this thing done right for the holiday people. apparently more important for the president to play governor golf and members of

the democrat senate to go off to the caribbean and exotic destinations and pass a two month extension and come back and hammer the democrats next year. but they can't even do what senator mccain recommended. senator mccain recommended, take the senate bill, amend it, turn it into year-long extension and get it, and then leave town. i'm not certain that it gets paid for by higher fees included in the senate bill. i don't know if you can pay for an entire year but still --. bill: same hang up. you mentioned mccain. he was on "fox and friends" last hour. he was talking to brian kilmeade and he laid, or he tried to lay the blame at the feet. white house. roll it. >> well, i think that the president should play much more of a lead role rather than go shopping for his dog. maybe call these people over at the white house as the previous four presidents that i served under would have done and see if we can't hammer something out. in fact the reality, brian, this issue is hurting

republicans. democrats are exploiting it and i would hope that maybe house members might come back and vote the same bill the senate passed only make it a year instead of two months and then send it back to the senate. i think it is one way out of this. bill: i think he was reading your mind. is that the way out of it for republicans? >> pass the two-month bill and come back and live to fight another day, he is absolutely right. the president adroitly used this, if the president was really interested in a year long extension which what he said he was at beginning of process, when harry reid moved to have a two-month extension, the president would have said no, harry i want a year long extension, get it done. instead he said great, this allows us to use this issue politically against the republicans to raise my numbers and undermine the credibility of republicans as anti-tax. keep about it, we keep this going next year. don't pass the tax cut

extension next year and blame the republicans in january and february and march and whenever we finally roll over do exactly ought to be done, it was all the republicans fault and he has a big meg gone to do it. bill: -- meg phone. bill: the republican argued for decades to win this argument and now we're losing it when it comes to taxes. you write today in the "wall street journal" what will happen next 11 months and the presidential strategy to win a second term. you argue mr. obama will frame the lech ship as a fight for the middle class. how do the republicans counter? >> look at the strategy in its entirety. fight for the middle class. he will say this is about fairness. middle class are being treated unfairly and we need to tax other people in order to give them bigger benefits. he will engage in class warfare. he is going to blame republicans and others for everything bad that has gone on and give us a big laundry list of accomplishments. there are strengths and weaknesses for each one of these.

being aware he is focused on middle class he knows he has a weakness with exactly those voters. they don't like what he has done. we need to reinforce the feelings that they have got he has failed to do what he said he would do by using his words and his actions to indict his record. we need to have a moral argument as well as an economic response to his class warfare. it is not a particularly effective presidential strategy. it was used by mondale, dukakis, gore and kerry and didn't work for them. republicans better examine what he said in two speeches, the "60 minutes" interview and his speech in kansas earlier this month in there are the broad contours of a strategy and also in there are the broad contours of a response. bill: it is great to get your reaction on that. that is a preview what we will all watch the next 11 months, "wall street journal" today. have a merry christmas to you and your family down there in texas. >> thank you. i think you have mike emanuel and karl christian rove taking about

the same issue today, the payroll tax fight. bill: i agree. that is reference -- >> christmas theme. bill: now i get it. emanuel, huh. sing well and sing loud. see you, karl. >> thank you. bill: 20 minutes pass. martha: we have correction on weekly jobs number came out a while ago. the numbers are 364,000, not 346,000. we said a couple minutes ago. that number is correctly on your screen correctly now. storm warnings and winter weather advisories for all the holiday travelers out there. take a look. it will be very rough for some parts of the country. the weather outlook comes up next. bill: latest polling in iowa. surprising numbers. others have romney in the lead. others have ron paul in the top spot. what are we to make out of all this and what are we to expect from iowa?

bill: 23 minutes past the hour now. two crewmembers arrested in finland. get this now. after police say they were carrying weapons to china. the british flagged vessel contained 69 patriot missiles along with tons of explosives. parliament should vote in favor of speeding up a massive budget cutting package meant to restore confidence in the struggling italian economy and contain damage from the country's financial crisis. while santa claus is getting ready for annual christmas ride the air force is getting ready to track him. thousands will volunteer to be receive calls for updates on santa's location. norad is tracking it all. i think, martha, there is an app for that. martha: absolutely there is an app for that. bill: probably a free app. martha: christmas starts in day and a half because of norad and because of difficult parts of the word.

that is how santa does it. now we turn our attention to this story for you this morning. the white house says that it is deeply disturbed by the latest reports of violence in syria. human rights groups say president bashar assad's troops surrounded and killed more than is00 protesters literally mowing them down. the witnesses describe this as organized massacre that went on for hours. leland vitter joins us live from jerusalem with more. >> reporter: martha, this may be a case of syrian government trying to kill as many people as they can before the arab league monitors arrive in the next few days. as of late they have killed at least 200 people and are getting a lot of help doing it. we have learned from western intelligence sources that iran is sending weapons, men and ammunition into syria. that in and of itself isn't that surprising but we can now confirm they are using international airlines, meaning commercial airlines, in order to be able to

bypass sanctions that they send these weapons in to keep president assad in power. syria's powerful air force and army are among the most well-equipped in middle east with russian fighter jets, attack helicopters and tanks. president bashar assad is prepared to use them all against his own people to stay in power. fox news has learned that iran and its revolutionary guard are going to great lengths to help. >> you can identify the iranian involvement in a negative manner in any conflict, almost any conflict in the middle east. >> reporter: israeli minister for strategic affairs says the iranians are desperately trying to keep assad in power because he provides a crucial link to hamas and hezbollah. as assad plows through weapons and ammunition supplies during his eight-month massacre of pro-democracy demonstrators intelligence says he is running out of critical items. hence the ammunition air

bridge, loading planes from tehran's international airport, flying with unsuspecting passengers to damascus where planes taxi to a military facility for unloading. it is a last-ditch effort by the iranians to cover their tracks as turkey recently intercepted a number of arms shipments using iranian cargo planes and has been banned from its airspace. we have since learned there are seven flights a week from damascus, into damascus from tehran. they are using for these armed shipments on mehan air and iranian airlines. martha, back to you. martha: leland, thank you very much. bill: a new boost in iowa's battleground for one republican candidate but is it enough to win that state? we have a great panel on that, a fair and balanced debate. we have one young girl's christmas wish. >> what do you really want for christmas? >> i do want my dad. >> you want your dad to come home? me too.

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bill: well, today is the first full day of winter and it is bringing plenty of snow in certain states like colorado. that is bad news for folks trying to get around the state for the holiday. travelers bracing for icy roads and some airport delays. rick reichmuth is back. he thawed out from oklahoma. he is back in our weather center. what are you seeing, rick? good morning. >> take a look at this, 52 in new york city. 43 in cleveland. that means any storms we see on the coast i think are going to be rain. temps across the west are very cold can. that is where all the snow has been this year. we're getting it now in

denver. let's look at the kdvr shot, live picture coming up in denver. they will see about another three inches of snow today. we have snow completely covering the road. that means very treacherous droving conditions. their temperature is 21 degrees so not getting any melting at all. any white christmas will be there, new mexico, panhandle of oklahoma and texas. they will see more snow. take a look at this though. we have heavy rain in parts of louisiana and the deep south here. that will be the continued rain-maker over next day as it moves off toward the east. look at futurecast. the storm drops off new mexico and pulse to the northeast. i think we'll see a little bit of snow in interior sections in the northeast tomorrow. rain on the coast. after that, tell you pretty clear sailing. today is a bad travel day, bill and things improve. bill: it is freaky to be 56 degrees in new york on december 22nd, wow! doesn't happen every year like this.

thank you, rick and welcome home. rick reichmuth. martha: let's go back and take a look at the iowa polls this morning because presidential candidate mitt romney jumps into the lead according to one of brand new iowa polls, two weeks before the caucuses, folks. look at rasmussen number. romney beats ron paul by 5% according to this number. newt gingrich is in third on this particular poll but when you take a look at the average of all the recent state iowa polls, ron paul is still in first place at 23.8%. you've got romney in second, 20 and change and newt gingrich 17% from this one as well. joined by chris fer hahn, former aid to senator chuck schumer and. good to have you here this morning. >> thanks, martha. martha: good morning, guys. when you look at these iowa poles obviously, terry, that poll is good news for

mitt romney. although we've seen a lot of polls in the average showing that ron paul could indeed take iowa many people have predicted. how do you think this shakes out? >> i think it is anybody to win. iowa rewards hard work and now we're seeing a lot of the tv advertising take hold. i think that's benefited romney. but listen, when you get to the caucus night, we talked about how involved and complex that process is, i think these polls say one thing, iowa can be won by any one of three or four different candidates and it means we'll have a really high drama contest in iowa in two weeks. martha: there is a backlash coming out against ron paul. we saw it happen to a number of the other candidates up to this point. and now you've got some very strong words from rich lowery this morning. take a look what rich lowery had to say. the iowa caucus-goers are protective the eminent place in the process. if they give a victory to ron paul no one should take

them seriously again. dorothy rabinowitz, a scathing, long time editorialist in "wall street journal" she had very strong words against ron paul as well. rarely have we heard in any american political figure concern for appreciation for motives of those who attacked us and so resounding silence of the suffering of those thousands that perpetrators of 9/11 set out to deliberately kill. talking about his take on 9/11. talking about his take on iran. this is tough territory for him and guns are coming out against him, chris. >> it was only a matter of time before the knives came out for ron paul. republicans can not let him be their standard-bearer, he would go down in flames and bring the entire party across the country with him. they have the knives out for him. that said i think he is very strong position in iowa for simple reason he only one has a traditional iowa ground game in place right now off the top tier candidates. he spent a lot of time on

the ground. he has dozens if not hundreds of college students out in the streets for him and fervent supporters of ron paul. i think he will fair very well on the caucuses in january. it is two days after new year. people will be just waking up. in iowa people are kind of used to having that ground game and someone pull them out to the caucus. mitt romney doesn't have that organization. newt gingrich surely doesn't that that organization that said, if anybody but newt gingrich wins iowa and if anybody but newt gingrich comes in second in iowa, it's a win for mitt romney going into new hampshire where he should dominate. martha: i think you may be right about that. terry, do you think that's true? if mitt romney comes in second will that be seen in the big picture as a win for him? or, does that line of thinking fall into something that makes a lot of people angry, that mitt romney does not look in these polls as the presumptive winner as he goes ahead? >> i don't think mitt romney needs to win iowa necessarily but i do think the other guest is mistaken,

that other cam panes have we have have very well-developed ground games in iowa. one of ron paul's challenges he brings new people into a process dominated by a lot of real pros on the ground. i think he could have very, develop well and potentially true he could win but ultimately this is going to be a real contest on the ground in iowa and i think it is an open contest. i think, iowa in its position as the first in the nation contest sort of rewards the people, it is kind of a purity test, martha and not necessarily an indicator what is going to happen in new hampshire as we've seen over the years. >> terry, mitt romney, mitt romney has an air campaign in iowa. newt gingrich has got virtually nothing going on in iowa. martha: he says it is all coming out after christmas. stay tuned, chris. we'll see. we'll bring you back and talk about it. >> merry christmas.

we'll unwrap the bow. bill: jon huntsman wants to be the next president of the united states but back in the day he had a different dream job in mind. utah's form former governor telling david letterman he wanted to be a rock legend. he came this close last night. ♪ . ♪ go, john any be good . bill: not bad. martha: impressive, don't you think? bill: huntsman played keyboard in a band called wizard when he was driving around a station wagon with wood paneling back in the 1970s. he was on our show yesterday, right? martha: yeah. bill: he did not show us those talents. martha: we didn't know. bill: when he comes back we'll have a keyboard ready for him. martha: reminds me of the bill clinton saxophone days. bill: a little bit. martha: that was pretty impressive. bill: john any be good, jon

huntsman. well-played. martha: one of the states that has been hit hardest by the country's unemployment crisis is showing signs of a comeback, the road to the white house always runs through ohio. just ask bill hemmer who is from ohio. he will tell you that any day of the week. we'll he will talk to governor john kasich. bill: all roads lead back to cincinnati. martha: sooner or later. bill: live from the hill, we're expecting remarks from every side momentarily starting with house speaker john boehner at 10:00 eastern time that is 20 minutes away. we'll talk to republican tom price and ask him whether or not he agrees with karl rove who just told us that republicans should give in to democrats on this. this is an rc robotic claw.

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>> something wrong? martha: remember that? doesn't happen only in the

movies. a 9-year-old's trip to visit her grandmother turned into nerve-wracking ordeal. she was traveling on southwestern airlines between tampa and new york city. they had a unexpected plane change in baltimore. when her original flight landed in laguardia she wasn't on it. can you imagine? her family understandably went into panic mode. >> holy cow, i'm not supposed to get off here. supposed to get off at la ward guard yaw? >> i don't want that feeling whether five minutes or 15 minutes. martha: who does? oh, my gosh. what a horrible story. spokesperson person for southwest airlines their uncompanied minor policy does not include contacting guardians when a flight is delayed or rerouted. gee, they might want to rethink that policy. bill: i'm going to laguardia. ohio one of the states hit hardest by the unemployment crisis but the picture might be getting slightly better in the buckeye state based on new numbers.

unemployment rate is down to 8.5% that is half-point drop from october. more than a one point drop from a year ago. i talked about all that with the state's governor, john kasich. john kasich ohio, welcome back to "america's newsroom" and merry christmas to you. your unemployment rate is dropping. you held a big press conference earlier in the week bragging about the gains ohio is making. are you creating jobs? because that still seems to be the tricky issue this so many parts of the country? >> we're up, according to the "cleveland plain-dealer", about 65,000 net new jobs in the private sector. bill, we are the fastest growing job-creating state in the midwest and we're number eight in the country but let me tell you what's happened. we took an $8 billion budget deficit. we got rid of it. there is no surprises coming when it comes to things like raising taxes. we're not going to do it. we actually cut taxes. our credit went up. when s&p downgraded the united states our credit

improved. so we have, we also have improved our regulatory environment out here. so what's happened is, there is certainty. this is something the country, you know, be good for the people in washington to understand. when you create certainty, people get comfortable and then they teal like they can invest because they know what the future will bring by and large. so in ohio --, well, we don't, we're not going to have to raise taxes because our budget is balance laed. we're running a surplus. we reduced taxes. we improved our regulation and now we're working on job training and improving graduation rates from our universities. we know how to answer the phone when companies want to come in ohio like just yesterday i announced that phillips will move their r&d from san jose, california to cleveland on their imaging. why is that? if you're in california you don't know what is going to happen. if you come to ohio you're certain things are pretty stable. when you create an environment --. bill: yo mean to interrupt you but we heard complaints

about the whole pay cut tax fight up in washington, d.c. but you're painting a better picture of ohio we have seen in probably three or four years. if that is the case how does that fit into the election of 2012 in 11 months? >> well, look, what, i feel good about, bill, is that people are going to have a little merrier christmas. we lost more jobs in ohio than any other state except for california and michigan in the last 10 years. so by just awaking a sleeping giant, which is what ohio is because of its scale, the population, 11 1/2 million, all of our big cities, our education institutions we sort of fixed it. i don't know what it will mean for 2012. i just hope we can keep the momentum going. this is the issue in washington. bill: do you think ohio in, ohio my sense that is it is 50/50 state. it could go either way. do you see it that way? >> sure. yeah, ohio is very closely

different i had divided between republicans and democrats. it tends to be more conservative than it is liberal. and, you know, but predicting 12, that's a year, almost a year, less than a year away. who knows. i mean i don't know who the republican nominee's going to be. bill: who do you think runs the best against president obama at the moment? >> not going there. let it play out. i don't have a lot, bill, believe it or not i don't have a lot of time to be thinking about national politics and i don't. i have got too much to do out here. as things get better out here that's what i care about. i've been in politics a long time, and you know, like watching soap operas in some ways all this political stuff. at the end of the day when we have a nominee, you know, i will get behind them and do what i can but i'm most concerned about keeping our legislature conservative and republican and continuing to fix ohio because here's what i believe, bill. washington is largely dysfunctional in case we haven't all figured that out. i believe the changes in the

leadership is coming from the states now. we have some terrific governors out there who are taking on tough issues, becoming role models for the way in which washington can get their act together. so i really believe power is going to come from the states up, not from the federal government down. i just wish the federal government would get out of our way and let us do our jobs out here. bill: governor, thank you for your time today. to you and your family have a merry christmas, all right? >> merry christmas. happy new year, happy hanukkah, thank you. bill: you bet. to all good things things in 2012. to governor john kasich in columbus. now if you have questions happening in your state or something you see you're cure chris about, shoot e-mail as hemmer@foxnews.com. or @billhemmer. 100 characters or less. some of the issues case i can is outlining right they're playing out in state after state and that will decide who wins the

white house next november. martha: he is right. so much leadership is. coulding from the state level and that push. they're actually trying some of these austerity moves in different states across the country like ohio, new jersey, virginia. we're seeing the backlash in some cases. a tough thing to accomplish. very interesting, talk with case i can there. so, how about this, a very early christmas surprise for a kansas girl who didn't want any toys this holiday, just her dad. the story behind this video, wait until you see this, is next. bill: let's make her dreams come true. only a few months ago people were begging chris christie to run for president but could he not be perfect person for the vp slot? martha asked him about that. martha: you have said, who would want me to be their vice president? look at my percent namt. you know, do you think that he would will to have somebody as strong and as out there as you in the number two spot?

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bill: remarkable story of survival. a college student surviving 10 days in freezing temperatures on nothing but candy bars and melted snow. 23-year-old lauren weinberg was driving in the mountains during a snowstorm on december 12th. her car got stuck on unpaved road in the forest. she survived by rationing two candy bars, melting snow and a water bottle. she was cold and wet and hungry but ecstatic to be found. martha: wow!. bill: how about that? ♪ i will have a blue christmas without you ♪. martha: i'm not familiar with that. bill: is that martha maccallum's christmas album? martha: that is going out in the future so i'm glad you're helping me pump it

up. she wanted one thing from santa this year, her dad, serving overseas to come home. little mattie hall put her faith in st. nick to make it happen. >> every year kids line up at oak who lowell mall in high point to see santa. many wonder if they will get what they ask for under the tree. >> soldier. >> this year mattie hall wants a soldier, but not just any soldier. >> what do you really want for christmas? >> i do want my dad. >> you want your dad to come home? me too. >> that's why she's here. >> where is your daddy? >> he is in texas. >> because if anyone can deliver him, it is santa. >> okay. one, two, three. i want my daddy. >> i want my daddy. >> okay. let's see what we can do. >> daddy!. [applause] >> turns out this christmas

present for mattie -- >> okay? >> uh-huh. >> i missed you. >> missed you too. >> was a tremendous gift for your dad too. >> i was trying not to cry. >> they planned the surprise a week ago. seth finished his second tour in iraq. it has been seven months since he has seen his family. he was last home just in time to see the birth of mattie's sister, juliet. >> being away from them, let you know how for granted you ta things sometimes. even the little amount of types can never be made back up. so plan on spending all my time with them. >> today is pretty much christmas so. is specially for her. >> did you get what you wanted for christmas? >> uh-huh. >> a christmas miracle all because mattie had her faith in santa. >> santa like, i have to think about it but i really think this was going to happen. [laughter] bill: sweet. martha: have a little faith,

right? seven months is a long time not to see a child that young because they change so much, you know, in seven months. nice for that family to get to be together. thanks to santa claus. bill: mattie is a true believer in santa forever. kristin nelson reporting on that. thanks for that. there are new calls for the nation's top attorney to step down. who is joining the growing chorus for eric holder's resignation over the botched "fast and furious" gun program and how will this play in an election year? martha: the gloves are off, folks, for the fight in the iowa caucuses. coming down to the wire, the new message that mitt romney is sending to newt gingrich. >> if you can't stand the relatively modest heat in the kitchen right now, wait until obama's "hell's kitchen" shows up. [ male announcer ] the more you lose, the more you lose, because for every two pounds you lose through diet and exercise, alli can help you lose one more by blocking some of the fat you eat.

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great in your christmas red. martha: thank you, bill. bill: the clock is ticking, and if there is no agreement, the tax cut disappears on the 1st of january. martha: that's right. any indication, shannon bream, that anything is breaking through here? >> reporter: we do have some new developments, martha. we could hear from house gop leadership at any time. we do expect that speaker john boehner is not going to waver from his mention, what he's been saying. that a two month extension of the tax cut is not good for businesses or the average american either. we will hear from democrats in the house. we have just gotten a letter from the offices of nancy pelosi, the minority leader, signed on to by other top democrats, and here's what their proposing. they say democrats will give unanimous consent to that senate bill meaning you can go ahead to the floor, we can pass the bill without calling everybody back to the floor for a traditional roll call vote where everybody would have to be here and

actually vote. the problem, of course, is republicans, even though they have democrats' assurances they're unanimous, the republicans are not. so this letter now puts the onus back on them to explain why they will not move forward with this senate bill, martha. martha: boy. so what about the white house? any hints about what the president is going to say when he comes out in a little while? >> reporter: well, we do expect to hear from him after noon today eastern time. what the white house has been doing is asking people out there to tell them what it would mean to lose $40 per paycheck, that's what they're estimating it would cost the average american. check out this tweet from the president. he says everyone should see what $40 means to folks. keep it going. i'll talk about this tomorrow at 12:15 eastern. he was meaning today. he may share some of the stories today as he was out shopping yesterday for possibly some holiday gifts for his family now in hawaii, the white house has

tens of thousands of stories poured in from people who are saying just how much of an impact that $40 per paycheck would have on them. he may share some of those stories today at that event just after noon. by the way, he said he would stay here and not go to hawaii until this deal was done. right now his departure if and when is absolutely uncertain at this point, martha. martha: shannon, thank you so much. shannon bream at the white house today. let's break this down a little bit. failure to extend the payroll tax cut would have a drawsic and -- drastic and immediate impact on average americans. jay carney had one example. take a look. >> if congress fails, if house fails to act, the typical family making $50,000 a year will have about $40 less to spend or save with each paycheck. that adds up to about a thousand bucks for the year. someone contacting us from connecticut says i can buy lunch from the cafeteria for almost a whole month for my twins, i can

save it for my daughter's prescription deductibles. to some people $40 is nothing, but $40 is big money for us. martha: wow. i guess some people would say that the house republicans would like to see that $40 savings extended for a 12-month period instead of just two months. house speaker john boehner expected to speak any minute, we're going to take you there live as soon as that gets under way. bill: new calls for eric holder to step down today over this controversial gun-running sting known as fast and furious. now, the rnc chairman promising the botched operation will be a big deal during the election season next year saying, quote: obama's leadership deficit in holding the members of his administration accountable demonstrates yet again that the president is taking washington in the wrong direction, only make things worse. if obama won't fire holder, we will. we'll fire the whole team in the just 11 months.

jonah goldberg, editor at large, national review, fox news contributor, good morning to you. >> hey, good morning, bill. bill: republicans, do they see this issue sticking more than just beyond the hearings we watched last month? >> oh, i think so. whether or not this is the watergate that some bloggers want to make it into remains to be seen, but i think it's a big and legitimate issue, it's a serious scandal. i think eric holder has behaved abysmally politically and on the policy. but i think why prebus is doing this is to fire up the republican base. conservatives care about this a great deal, and they want to keep this issue alive particularly because they think the mainstream media isn't following it. whether, in fact, this is a major issue in the 2012 election campaign kind of remains to be seen because it depends on who the nominee is and the issues he or she wants to focus on. bill: i see his biggest point was level of confidence, right? when you put fast and furious along with stories like

solyndra, that's what he's going for, would you agree? >> you know, i think that's right. they're trying to build a narrative of white house incompetence, white house backing ideological plays rather than doing what obama constantly says he wants to do which is just do what works and be a pragmatist and all the rest. and i think that the fast and furious thing fits perfectly into that narrative of building up why we need to replace this guy, because i think that's what the republican party is focused entirely on. bill: so if that is the case whomever the candidate is whether it's mitt romney, newt gingrich, whomever the nominating process puts forward, do they pick up on this? or do they go to the economy and pivot? >> oh, i think -- there's no way, there's no way that the economy is not going to be if not the number one issue, then the number two issue. i mean, the only way i could see it not being the number one issue is if conditions in iraq continue to spiral around and the place truly goes to hell in a hand basket, you could see maybe foreign policy coming back on. but the economy is everything

unless it takes off and goes to 10% growth or something, that's going to define everything, and that defines the mood in the country. bill: have a great holiday, jonah. we've got to run. breaking news, mar that. martha: john boehner is speaking on the payroll tax cut issue. let's listen. >> that will provide for one year of tax relief for american workers. i told the president there's one big reason why we need to do a full year, and that's jobs. a one-year bill, like the president requested and like the house produced, is simply better for jobs and better for our economy. a one-year bill provides on average about a thousand dollars for american workers as opposed to the senate bill which would provide a measly $166. as importantly, a one-year bill would provide certainty for american employers as they begin to plan for next year. a two month extension only perpetuates the uncertainty that

too many employers already have in dealing with the economy and what's coming out of washington. listen, i used to run a small business. i can tell you that the language in the senate bill will hurt small businesses. the senate only goes for two months, but businesses send their taxes in, write the check, i used to write the check to the irs, but it's done on a quarterly basis. and so you're going to have a couple of months of this and another month of this trying to, trying to figure out what your obligation is, it's going to be difficult. and secondly, the paperwork requirements in the programming requirements contained in the senate bill will make it virtually impossible for those who provide payroll services to do the job that employers hired them to do. now, the fact is we can do better. americans are still asking the question, where are the jobs. it's time for us to sit down and

have a serious negotiation, solve this problem so that american workers don't see their taxes go up in january. >> good morning. as the speaker said, it is our position that we want to make sure we provide some certainty to the working people of this country, that their taxes are not going to go up for an entire year. unfortunately, that view -- although it is shared -- is not being implemented or proposed to be implements by the senate proposal. and, you know, we're here, and we want to solve the problem, and, frankly, given where the parties are there's not a big difference between our positions. it all comes down to the paid-fors, the impact, budgetary impact of the extension of this tax holiday. and so i saw the president out yesterday doing his christmas shopping, saw he brought his dog with him. you know, we're here. he could bring his dog up here. we are pet-friendly. and, you know, again, it will not take a long time.

we could probably resolve the differences within an hour. that's why we're here, to say let's do this as the speaker said, let's avoid any more uncertainty, let's try and avoid another one of these difficult moments within 60 days so we can get on about the business of putting in place factors for better economy and job creation. >> good morning, dave camp. employers are telling us that this convoluted mechanism the senate kicked up in a rush to get out of town doesn't work. and we think we should listen to our employers. the democrats failed to do that in the health care bill, and that's how we ended up with that burdensome 1099 position that we had to repeal, and we did so in a bipartisan way. martha: all right. we are watching all of this play out, john boehner speaking about what he beliefs is the right way to go here with a one-year extense of the payroll tax cut that would allow people to see

that $40 stay in their paycheck through the next 12 months. that will provide certainty to businesses, eric cantor followed him as well imploring the president to come over there with his dog as he did when he went shopping yesterday and try to work this whole thing out. we're going to hear from democrats and also the president over the next couple of hours, and we'll see where we go. bill: yeah. and their big point is the president supported the year extension in the beginning and backed away because the senate could not find a way to pay for it. , the senate's not coming back which means this issue's going to pop up again within days or weeks, and they're going to have to figure out who answers the phone then. martha: i know. bill: did you catch that? maybe that's speaker boehner. martha: well, let's see. no. bill: all right. but if you want to talk, speaker boehner, we've got a line open. [laughter] all right, she had the right idea, take the train instead of driving drunk, but even a train can be dangerous after too much of that eggnog.

it ends well, by the way. martha: and this little girl vanished from her father's home over last weekend. today as the search continues for ayla reynolds, the finger pointing is getting even more intense in this case. we're going to talk about that. bill: also, he has been asked this question, but would chris christie be a vp candidate now? part two of martha's interview with the husband and wife team out of new jersey. >> we have a very candid relationship with each other. he calls, and we talk all the time about what's going on in the campaign, and he asks for my thoughts, and i give them to him. martha: have you talked about a vice presidential role for you?

martha: well, in 2011 new jersey governor chris christie burst onto the national political scene and made a name for himself with no-nonsense moments like this one. >> i ask people to not take a raise for a year to pay 1.5% of

their salary towards their benefits. and your union has said that that, that that is the greatest assault on public education in the history of the state. that's why the union has no credibility; stupid statements like that. [cheers and applause] martha: that's just one of the greatest hits from 2011. he then found himself in the center of the most heated call to run for the white house until this. >> now is not my time. i have a commitment to new jersey that i simply will not abandon. martha: he said that today that he and his wife, mary pat, made the decision today. mary pat crest tee is also getting used to the limelight and the future expectations that surround her husband, so how does she deal with all of this? i asked her that during part two of my interview with the christies. >> it's a, you know, weekly

reassessment we do in our family. [laughter] i have a great partner. chris is a really great father and a great husband, so we really do work hard at it, and our children are on the team too. our attitudes kind of are in the mindset that we're so lucky to be here, so it all comes into place, it really does. and i love every part of my life. i really enjoy. so i feel fortunate to be able to work and be a mom and, gosh, be the first lady of new jersey is a pretty amazing honor. it's fun. martha: this is the first time the two of you have sat down for something like this, and i think everybody has gotten to know you, governor christie, and sometimes they see the brash sound bite that comes out of a town hall. but what's the dynamic like with you guys? what is this partnership like? some people might say, boy, i wonder what it's like being married to him. [laughter] >> i'm sure they do. um, well, you know, this is -- we, a lot of it goes back to how long we've been together. mary pat and i will be married

26 years in march, so, you know, we got together in the college. so well before i ever thought about becoming governor of new jersey, i was mary pat's husband. and so, you know, we've, we were best friends first. dated other people and then eventually started dating ourselves and got married relatively quickly. and so the relationship has always been a partnership from the beginning. you know, when we got married, i was still in law school, and mary pat was the one working full time, and i was working part time, and she was supporting the family and helping me to get to finish through law school. and so, you know, we've, we've been partners in all this right from the beginning. and now with our four children, you know, we act as partners again. and so, um, i think what people see on tv from me is who i am, and it's who i am at home too, but i have someone equally strong as a partner. so if i push, she pushes back, and she feels like that was the thing she wanted to do at that point, and we've been doing that with each other for 26 years in addition to supporting each

other. martha: and, you know, when you made the decision -- there was one weekend, i guess, when you gave some serious consideration to running, and what you said when you came out of that news conference that day was that mary pat said to you, you know, if you want to do this, i'm on board. and i think up until that point it was not something that you wanted, was it? >> no. it was something that i was, at the end of the day, really supportive of what chris wants to do. but there a personal perspective -- from a personal perspective, i wasn't crazy about making that sacrifice because of how young our youngest child's 8. but at the end of the day if it was the right thing to do, i would have been happy to be onboard. martha: what was that like when you were having those discussions? >> it was exciting, and it was, um, it weighed heavy on us, i would say. but the end of the day we both felt like we had made a commitment to the state of new jersey, and that was more important. and it was a real obligation.

and chris is doing such a good job here. martha: ed rollins said that he thinks the relationship that you and mitt romney have had is a novel one. he said, you know, i haven't seen a pairing like that this early on in the process, and he said anybody, chris christie would be on anybody's short list for vice president. do you think it's a novel role that you're playing in this, in this process? >> um, i'm just doing whatever he asks me to do that's consistent with my responsibilities here in new jersey. and so we have a very candid relationship with each other. he calls, and we talk all the time about what's going on in the campaign, and he asks for my thoughts, and i give them to him. martha: have you talked about a vice presidential role for you? >> no. martha: never come up? >> no. you know, i don't think you talk about that stuff. i think if you're a nominee, you're afraid to talk about that stuff because you don't want to jinx yourself. he hasn't said that to me, but i don't think he wants to be presumptuous enough when he's not yet the nominee. there'll be plenty of time for that once he sews up the

nomination, and i hope that he'll talk to a broad range of people to try to find the partner that he thinks will best serve him and america. martha: you have said who would want me to be their vice president, you know, look at my personality. do you think he would be willing to have somebody as strong and as out there as you in the number two spot? >> i don't know. you'd have to ask him. martha: i will ask him the next time i see him. >> yeah. martha: but you're not closing the door on it? >> i think it's presumptuous to do that. running for president, that's my decision and mary pat's decision alone. vice president's the decision of only one person. whoever the nominee of your party is, and i think it's awful to say i will do something when it hasn't been offered. fact is, if governor romney comes to me and wants to talk to me about that, we'll have a full, complete conversation about it, and mary pat and i will make a decision about what we want to do with our future. but my view is i think if you fast forward the tape to a year from now, i think it's going to be president-elect romney and

some other vice president-elect and chris christie, the governor of new jersey. martha: nobody ever turns it down though. >> i don't know. >> it's pretty -- >> i don't know about that. gerald ford turned it down, didn't he? that was unusual circumstances, but i'll tell you, martha, nobody i think who's had it offered to them has had as great a job as i have. i love my job. so the idea is, wow, i'm not looking for the next promotion on the ladder. i'm looking to make a difference. and in new jersey every day i'm making a difference. i believe that. and that's what we got into public service for. not to get a title, but to get something done. so that's why i say to you i could envision myself saying no because if i feel like i'm being really effective here and there's more to do here, then i'm going to want to stay here. martha: hmm. very interesting. speaking to the two of them. and, you know, i got -- as a new jersey person, it is a pretty great job. i mean, you know, being the governor of new jersey, i don't

know that it gets much better than that. bill: coolest thing about christie, is that he's seen springsteen in concert 120 times, so he really is a jersey guy. martha: definitely is. bill: ed rollins on who's getting the better of this brawl.

bill: here we go. 12:22, the u.s. expressing regrets over a deadly airstrike in pakistan, last month's attack killed 24 pakistani troops. the pentagon calls the incident an act of self-defense. the death of a newborn missouri baby promising walmart to pull a powdered infant formula from 3,000 of its stores. employees at fedex working overtime the get your package delivered in time. it expects to deliver more than 120 million parcels around the

world this week, up 6% from last year. martha: thank you, bill. all right, let's get to this now for you. the search widening now for a missing toddler in maine. last night dozens of people turned out at a local church to pray for the missing 20-month-old. ayla reynolds vanished there her father's home over the weekend, and police have widened that search to include more trails and waterways in the area, and the finger pointing between the little girl's parents has gotten uglier. former prosecutor and criminal attorney arthur aidala joins me now. >> hi, martha. martha: yesterday the father made his first statement. we've heard nothing from him. we've seen the mom in a couple of stories on network television, but the father said i will not make accusations or insinuations towards anyone until police have been able to prove who is responsible for this which i found to be sort of a strange statement from the father. >> i'm not disagreeing with you,

but i have to be honest with you, martha, if someone ever came to me under the same circumstances, i don't think there is a right thing, there's a right way to handle it. let's talk about the positive things he's doing. he's working everything through the police department including that statement. that statement was issued through the police department that's investigating this matter. he doesn't have a lawyer. so he appears to be as transparent as possible. i think it's very odd he hasn't spoken to his child's mom. i think that's raising an eyebrow. i don't care how much you're fighting or how contentious your lifestyle. i mean, look, they were never married, they never lived together. so they were always separate families. she had to go into alcohol rehabilitation this past fall, he was awarded custody. he says he had every intention to have co-parents with the mom. however, the day before the child went messing, she went to court to file court papers that says i want to see my child more.

but she says dad didn't know, i had just filed them, he didn't even know about it yet. if he did, it would definitely raise some eyebrows. martha: yeah. that certainly feels like the catalyst in this story, the fact that she filed those papers, she was out of rehab at that point, she wanted him back -- the child had been with her relatives and then was taken from her relatives over to his house because he had legal custody at ha point,gy i guess, because of her drug or alcohol issues or whatever they were that sent her into rehab. look at the baby lisa case as well. can't the police figure out if an intruder came into the house and left with a child? >> you would think so, right? you're asking a very obvious question. but, obviously, they can't. i mean, i spoke to your staff this morning, and i said what happened to baby lisa? i kind of follow it every once in a while, but look at the resources in these two cases, and there's another one as well that's slipping my mind. there's three of them right now, and the resources that are being

thrown there are tremendous. whether they're professional law enforcement resources or all these volunteers who are combing the area. i mean, they're draining ponds, they're stopping streams from flowing, they're looking in every nook and cranny where you could possibly find a little kid, and they're not finding them. these are real mysteries unless there's some underground black market for these children to be abducted live, god bless them, and sold live -- martha: but that is the least case scenario. >> i know, i understand. martha: that an outsider comes into a home and takes the child out of the home. that is the least, you know, like the lindbergh baby case is very, very, very rare. >> to answer your question, with all these high-powered law enforcement authorities including the fbi involvement in some of these cases, you're right. is this guy with baby lisa, the father of the electrician some brilliant guy? is the mom who was drinking drunk until 10:30 at night hide every piece of dna and fabric that could lead to a clue? it's a real mystery, and the only thing not to get too crazy

that you can count on here are prayers. you just have to pray that these little babies are okay. martha: indeed, you do. we'll see where this goes, arthur. merry christmas to your family. >> i hope we can coffer some -- cover some nicer stories. bill: stumbling and bumbling your way through the holidays? [laughter] to be on television for the wrong reasons. drinking and can walking can be a challenge. martha: oh, boy. bill: she's okay. martha: thank you for that. bill: she's okay, and in a moment we're going to show you why. martha: and the mud is flying in iowa. newt gingrich says he's catching more than his fair share of it, and ed rollins is here to analyze that. we'll be right back. >> the iowa race has gotten to be a real mess. i think my good friends have bought about $7 or $8 million of negative advertising so far. s before me, guided only by a dream.

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martha: fox news alert, very tough news today. a rising death toll from a series of attacks in iraq just hours after the last u.s. troops pulled out. reports of up to 63 people killed, about 185 wounded in blasts and gunfire across baghdad. a family of five was ambushed in the streets north of the capital. father and son were both members of the anti-al-qaeda group that aided the united states. >> the iowa race has gotten to be a real mess. um, i think my good friends have bought ab $7 or $8 million of negative advertising so far. it's interesting to watch how -- [inaudible] the american people aren't stupid. the people know when you see a negative ad, somebody probably bought it. bill: that was newt gingrich in new hampshire talking about iowa's a real mess. now, referring to a slew of ads

airing now in the hawkeye state accusing mitt romney in particular of spending millions of dollars to take him down. ed rollins, republican strategist, former campaign manager, now a fox news contributor among many other things. he led mike huckabee to a victory in the 2008 in the iowa. good morning to you. >> my pleasure. bill: a real mess. what do you think about that? >> well, he's getting beat up. at the end of the day, newt doesn't have a real campaign. he's an effective debater and a very bright man, but there's no organization, and he's not prepared yet to go on the air and respond to these ads that are negative ads. that's all part of the game. that's what a campaign is about, and he wants to do it differently, but he's not -- bill: that could be the case right now, but he was on iowa radio a bit earlier today, and he said if i finish top three or four, then i take that momentum, go to new hampshire, finish second -- >> well, if he would have come in first which is where he was a few weeks ago, he'd have had a lot more momentum. bill: you know what the talk is out of iowa, hey, i've got the

gold, silver or bronze, right? onward we go. >> mitt romney had the discussion about the gold medals. they only have the medals in the olympics and sporting events. this is about getting delegates, and i think to a certain extent newt is the conservative alternative, but he's got to hold that position. the last thing anybody wants is a whiny wimp. bill: you think this is whiny and wimpy? >> i'm a big fan of his, i'm a friend of his. all of a sudden you get your nose bloodied a little bit, you can't start cry babying. this is like bob dole in 1986 against bush. you may remember that famous interview, quit lying about my record. well, once that occurred, his campaign was over. bill: this is mitt romney's reaction, more or less, to newt gingrich. roll this. >> if you can't stand the relatively modest heat in the kitchen right now, wait until obama's hell's kitchen shows up. bill: is that effective? >> sure. i mean, the truth of the matter is this is newt's record.

he has to be able to defend it. he doesn't necessarily have to attack romney. he can do that, romney's been attacked throughout this campaign, but romney has a long history of firing negative shots against other people. just ask giuliani, huckabee, anybody else. if you want tbeat him, you've got to go beat him. bill: i want a quick pause because the democrats are now speaking on the hill about this payroll tax matter. we heard boehner 20 minutes ago. steny hoyer, now, the democrat from maryland. >> taxes will go up for 160 million middle class, working americans. unemployment benefits will expire over the next 60 days for 2.3 million americans. and 48 million americans, seniors on medicare, will have the security of having their doctors available put at risk. we ought not to be creating that kind of uncertainty and anxiety

among the american people. the stakes are too high to be arguing about politics and process. the republicans' contention that the two months' come propoise is similarly unworkable is not true. if it were, we wouldn't see a desperate proposal to settle on a three month extension. speaker boehner, who just appeared here, says he and his members want a one-year expension. we want that too. now, we offered a bill that he talked about and the house passed a bill. he talks about regular order. that bill had no hearings in the ways and means committee, it had no markup in the ways and means committee and was passed three days after it was introduced. in the middle of december, just days ago. but he expected, i suppose, the senate to take it home. they didn't. what did the senate do? they did what americans are asking us to do. they came together o, reasoned

together and voted together. 89 senators. came together and said we ought to pass a compromise to give us time to work out any differences that remain. every family in america understands that. take a breath, step back, let's see how we can get to where we want tock. to be. that is a one-year extension and, yes, a two-year extension on is sgr. let's enact this bipartisan compromise, however, to eliminate uncertainty for american families and then get right to work on a one-year version. not wait until february, not walk away and hold off until the last minute. and let us not have a conference while we hold hostage 160 million americans. with fear that their tax will go up on january 1st.

let us not hold hostage 48 million seniors who will fear that their doctors will not be available to them. let us not hold hostage 2.3 million americans who don't have a job, are looking for a job, want to work and have the fear that they won't have the resources to support themselves and help support their families. the american people are waiting. they're watching closely and intently. there was a cartoon in "the washington post" today which said that speaker boehner said, you know, we didn't, you didn't get 12 presents under the tree, so i'm going to take away the two presents you got. mr. speaker, let's give them the two presents, and let's work on getting the other ten presents. that's what they want us to do. that's what the senate did. that's what almost everybody in this country including "the wall

street journal" says we ought to do, mr. speaker. now, perhaps rush limbaugh and grover norquist don't think that's what we ought to do, but americans think that's what we ought to do, and i am pleased now to yield to the ranking member of the budget committee who grapples with these issues every day, knows how difficult they are to resolve and knows that sometimes you make an agreement on what you can agree on and then continue to work on that which you cannot. chris van hollen from maryland. >> thank you, mr. hoyer, and thank all of you for joining us today. like you, i listened to the speaker of the house who was just at this podium a short time ago, and as i heard his remarks, it was very clear that he's not listening to the american people. just like the house republicans did not listen to the american people when they threatened to have the united states default on its debts for the first time in its history, just like they

have not listened to the american people when it comes to taking up the jobs bill that the president sent to the congress many, many months ago, and they've refused to act on it. that's not really surprising anymore. but you would have thought maybe, just maybe they would listen to some of their senate republican colleagues. 80% of whom voted for a bipartisan compromise to make sure that 160 million americans didn't see a tax increase come january, who worked together on a bipartisan basis to make sure that 2.2 million americans won't lose their unemployment benefits because they can't find a job through no fault of their own, and making sure the 48 million americans on medicare will have a doctor. the senate republican colleagues, their senate republican colleagues worked together to do that. we've heard from the editorial page of the "wall street journal," we've heard from karl rove, in fact, virtually the entire country with the exception of speaker of the house and the individuals who

are at this podium about ten minutes ago recognize that the right thing to do is to provide certainty and to make sure that payroll taxes don't go up january 1st. bill: democrats fighting mad again. boehner's not giving ground, you heard from the house speaker 20 minutes ago. president obama will be out in one hour. tom price, the republican, is on deck in minutes. ed rollins with me here. how is this resolved? >> it this is all politics at te end of the day. they come back after christmas, and they make this happen, and they will. it's two separate bills. the normal process is you go to some kind of a conference committee -- bill: is the speaker damaged? >> short term, maybe. at the end of the day, right now i hope most americans are worrying about hanukkah celebrations and christmas celebrations and new year's. they haven't lost anything at this point in time, and they won't. bill: what a day when democrats invoke "the wall street journal," karl rove and rush limbaugh in the same press conference. >> and former house leadership

talking about, basically, whatever the senate wants to do, we don't want to do. it's rare, but it's politics. bill: i say more eggnog. here's martha now. martha: republican tom price, the chairman of the house republican policy committee. speaker boehner appointed him to negotiate with the senate over the differences in this payroll tax cut extension issue. so you are a great person to have with us today, congressman price. welcome. >> hey, march martha. thanks so much. good to be with you. martha: good morning. you just heard steny hoyer, let's pass what we agreed on in the senate, this two month extension, so what's going on? >> it's hard to hold anybody hostage when you're here ready, willing and able to work. look, we're here, and the senate democrats are not, and that's the problem. the number one issue across this country is the economy and jobs, and in order to provide certainty to the market so that the economy can get rolling again, we've got to do something more than just a two month extension. we've got to provide greater certainty, and that's what we

believe. we're willing to talk with our senate colleagues, but they've got to come back to washington. again, we're here, and they're not. martha: yeah, a problem. and there doesn't seem to be -- you know, nancy pelosi put forward this idea that you could do a unanimous consent vote, and people wouldn't need to come back to do that. of course, you know you're not going to get unanimous consent in the house of representatives among republicans on this. but i guess the issue is it sounds somewhat reasonable when steny hoyer talks about do the two month thing right now, and we do that with a commitment to come back and work on a one-year deal and work out all of our differences right after the new year. what is wrong with that? >> it's because the policy is difference. we believe there ought to be a year-long extension of the tax holiday which is a $1,000 tax reduction for individuals. they believe it ought to be two months. that's $167. we believe that the extension of unemployment, federal unemployment benefits ought to be with some reforms, ought to allow the states to drug screen, for example, make certain that folks are getting their ged,

that they're working toward a job, and that ought to go on for 13 months. martha: but can't you get those things when you come back after the holidays and work on this one-year deal? >> well, there isn't any reason we can't do it now. but we don't have anybody to talk with. and then as a physician i can tell you that a two-year extension of the billions reimbursement formula for doctors taking care of seniors is so much more important than a two months. two months doesn't allow physicians to to be able to schedule surgery, is so seniors are going to be compromised in the care they receive. so there are reforms within our program that aren't within theirs. they want to increase fees on individuals, we want to decrease spending in order to pay for it. martha: i hear what you're saying, i think a lot of people do. what do you make of steny hoyer basically saying, look, you know, "the wall street journal," karl rove, everybody is telling these house republicans that they need to deal with this and move on? does that matter to you at all? do you care about that? >> well, look, i expect that out of steny, but the fact of the

matter is the house has passed a bill, the senate has passed a bill, and there are differences between them. and the way that you sort those out is to come together in a conference committee, sit down and work it out and come to that common ground. that's the way it's been done for over 200 years since the founding of the country. it's very, very basic. everybody who's taken a civics class knows that. maybe steny ought to read a civics book, i don't know. martha: you all have put forward conferees, but the senate has not. >> correct. we're calling on the president. he's going to go on television later and hopefully what he'll say is i've asked senator reid to appoint conferees to come back to washington. we're here, they're not. martha: what do you say to people at home who are saying, look, i don't need more money taken out of my paycheck after january 1? what do you say to them? >> we agree. we also believe you don't need more money taken out of your paycheck after february 29th. and we can provide that

certainty right now. martha: can you assure them that even if you don't get your one-year deal that they will not see their paycheck take that bite out of it? >> well, look, we're not going to negotiate with ourselves. we need to be negotiating with the senate democrats, but we can't do that until they come back to town. it is our desire to see taxes lowered and to see the size and scope of government decreased as well. that's what republicans stand for. this is the party of tax reductions. the other side needs to come to the table and negotiate with us so we can find that common ground. martha: all right. congressman price, thank you very much. you guys have got a lot of work to do before you can get home, and we thank you for spending time with us. >> merry christmas. march you too. bill: jenna lee's going to pick up on the drama. jenna: from the drama to jenna. i like that, bill. we're going to continue to talk about what's going on with the tax holiday debate, but in the meantime, we do have some good signs on the economy. there is some caution that's warranted. we're going to talk about this with steve moore as we take in what looks like a santa claus

rally on wall street. also, geraldo is here to talk about new developments in iraq, and larry sabato has his crystal ball out today. he'll discuss the anti-incumbent election myth. that's all coming up top of the hour. bill: all right, we'll see you, jenna. watch out who you call old around here. jenna: what do you mean? bill: the fbi is saying the so-called geezer bandit may not be what he says. we'll explain.

martha: well, you might say a little too much of the holiday cheer for one commuter across the pond. look at this. look at her. under she went. woman in britain should have been minding the gas as they say there when you get on the train. she took a tumble right off the platform. let's watch it again. there she goes. other passengers, though, quickly pulled her back to safety. that is the good end that story.

over and over again. she only got bumps and scrapes, we're told. british police say they released the video to highlight the dangers of excessive holiday drinking, folks, and if that won't stay in your mind over the weekend, i don't know what will. bill: she's okay. she's cool. that ride cost her two pounds in london. an arizona judge hearing arguments about racial profiling allegations against an illegal immigration sheriff, this a day after jail workers turned in their badges. what's going on here? william la jeunesse watching all of this out of l.a. what's the lawsuit against joe arpaio about, william? >> reporter: well, bill, the aclu and the mexican-american legal defense fund filed this case on behalf of five defendants who claim deputies stopped them because of race. it was about six years ago that more people were coming over the arizona/mexico border than texas and california combined.

maricopa county, which is metro phoenix, the sheriff stepped in and began in the course of regular police work, he says, traffic stops, robbery, domestic violence. he began to arrest, screen and hold people if they were in the u.s. illegally. the feds claimed that was their job. the hispanic community got upset because they 23e89 they were unfairly targeted, became a political issue. the aclu then filed a lawsuit claiming the sheriff illegally and unfairly put deputies in heavily hispanic areas. the sheriff says he was simply enforcing state statutes and doing what voters wanted. >> our policy, we don't discriminate. anybody booked into that jail, we run through their status. i don't care what they look like. every one, over 400,000. out of 400,000 we identified 44,000 in this country illegally

which is 25% of the united states. >> reporter: bill, i've been inside the jail, and i've been out with deputies, and i can tell you at night anyways the deputies couldn't tell what race the driver was when they pulled them over, and as for those immigrants or individuals in the jail, they may have been there on immigration detainer, but what landed them in jail was something else. bill: quickly, what could happen today, william? >> reporter: well, the aclu wants a federal judge to sanction the county for destroying records in the case, the sheriff wants the case dismissed. basically, at this point a report was released just last week by the federal department of justice that concluded the sheriff's office was engaged in discrimination, and the aclu will now use that to help make their case, and it should help them. the sheriff, of course, basically saying that he's a target of unfair federal targeting and prosecution, if you will. back to you. bill: william, thank you. william la jeunesse. for more on this story as it develops, fox news latino.com,

you'll get the very latest on today's hearing out of arizona if you want to check that out online and follow for updates. martha: the stakes are high for millions of americans, and right now all eyes are on the white house. we're waiting for the president to address the nation about this battle that's going on on capitol hill over extending the payroll tax cut. we will bring you that live straight ahead. be right back. [ dog ] i am a rockstar. my coat? solid gold. my insides? pure platinum. [ female announcer ] a healthy outside starts inside.

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with doctors dregenberg and honeydew. and we're here at the ul labs to demonstrate the do's... and don'ts... of holiday safety. ma ma ma me me. do water your tree every day. don't let your tree get too dry. oh! do make sure your lights have the ul mark. ooh ooh ooh! and don't use worn or damaged lights. oh! oh! ohh. are you okay, beaker? merit you lower this guy, the so-called "geezer

bandit". there he is. he may not be so old after all. the fbi now looking into this, they say the bank robber who hit 16 probation so far in southern california could be a young man in disguise, bill. bill: oh, he knows the neighborhood. martha: he looks to bewaring a mask and gloves they say. his ability to make a quick get way on foot leave people to wonder how old he might be. bill: only 10 days before if you new year's sew why not spend it with us? all american new year comes your way yet again as we get ready for a star-studded affair in times square. look at that day. if we get this day on new year's eve it will be a special gift wrap. martha: i think about the year you guys were so vizably freezing your little buns off out there. bill: icicles dripping off the eyelashes. was that a give way away?