conference? it's friday, december 19th and this is "now." the presidential press conference comes amid historic moves on cue baa and a computer hack. the fbi concluded that north korea is responsible for the sony pictures hack that pulled the plug on the movie "the interview." the fbi statement said the sony hack reaffirms that cyberattacks pose one of the greatest threats to the united states. the president said that he understands the concerns be you says that sony was wrong to shelf the film. >> yes, i think they made a mistake. we cannot have a society in which some dictator some place can impose censorship in the united states. >> sony pictures ceo michael linten responded by saying that the studio had no choice once

the theaters declined to show the film. >> we have not caved. we have not given up. we have persevered and we have not backed down. we have always had every desire to have the american public see this movie. >> going forward the president said he hopes congress will work with him to develop stronger cybersecurity measures. as for pyongyang he made sure to note that the target of this hack says a lot about the regime behind it. >> it says something interesting about north korea that they decided to have the state mount an all-out assault on a movie studio because of a satirical movie starring seth rogen and james flacco. >> worldwide mines that james flacco. >> joining me is robert gibbs and new york times white house correspondent peter baker.

robert, james flacco? could the president be thinking of joe flacco? the ravens quarterback? >> which -- no doubt in his mind and james franco was just -- joe flacco -- >> were you surprised at which the president responded to that question? and said that sony made a mistake. >> a little. the answer was set up as sony is a corporation that makes its own decisions. one thing that was interesting is his comparison -- not only how candid he was -- to that reaction being anal gous of not going to a sporting event for a fear of a terrorist activity. it equated what north korea had done to something similar to a terrorist activity and i think spoke volumes for a strong

answer for a strong country that is not going to be bullied by a country that has trouble feeding its people but can hack sony's e-mails. >> the president said i wish sony had reached out to me first. i think if the president wanted to get in touch with sony they would have taken his phone call. >> probably. but it's not a government decision. it's a private company and it is entitled to make a decision as it chooses to for its own reasons. what is interesting is when he talks about the idea of a proportional response. he wouldn't say of course. but is the united states going to launch a cyberattack on north korea? and is there a seth rogen in pyongyang to go after -- >> who is the james/joe flacco of pyongyang. >> james flacco of pyongyang.

>> that's a question i don't think we know the answer to that question. to peter's point. the hackers responded to sony's decision saying it's very wise you have made a decision to cancel the release of the "the interview." we ensure the security of your data unless you make additional trouble. this is like a missive from oz.. and that's the weirdness. on one hand the president is talking about the two stoner stars of "pineapple" express and comparing this to the boston marathon. there is this idea of what qualifies as proportional response. it's not something funny that would behoove james franco and seth rogen. but i cannot imagine how much more we can isolate the north koreans. >> it's a good question and i

think it will probably not deal with the burgeoning movie business in pyongyang but have much more likely to deal with, you know, some of the computer networks inside a defense structure or something like that. my hunch is that the proportional response that we ultimately read about will not be something -- will be something probably in -- written by peter and a couple of reporters in his newspaper but not something we will visibly see. but i think it will be definitely -- i mean, i think the passion with which you saw the president give this response means it's not simply about creative expression it's the response a strong country has to take if a country like north korea can so change the actions of a company like sony which appears to have such amazing ability to spread messages through movies and other things. >> peter, one of the more

chilling aspects of this is the ripple effect on other companies. and i wonder from the white house perspective will there be more communication between the administration and private business about how to handle something like this? >> i think the next company that comes into this kind of situation is going to remember the president said this about it and isn't going to be want to held out and shamed in effect as sony has been today and will think twice about making a decision without consulting the government and seeing if there are other options in terms of giving in to what seem to be international extortion. >> robert, from your time in the white house we talk about a lot of the president's concerns that are not on the front page but the administration spends a lot of time on. how much is the issue of cybersecurity the front of mind

for the president? >> quite a bit. i think anybody that studied security threats not just in the last year but, say, in the last five to seven years would put something like this at -- at one of the top two or three on top of a list, partly because, you know, it's the type of action that both a country and a non-state actor can take -- it can have a crippling effect. you know, you can do it. you don't have to, say, have an army to do it. you don't have to have a series of weapons to do it but you can still bring about great harm and most importantly great disturbance to the commerce of the country. i think that cybersecurity has been at top of mind and has been for those in the security business both in the private sector and the government for quite some time. >> i would be remiss if i did

not point out that the president called on female journalists. if he only called on male journalists we would not talk about this. did you know about this? and robert i'm going to ask you as weapon. what went on, peter? >> i didn't recognize it or realize it. i walked out thinking about what the story would be and i got back to my office and someone pointed it out to me. >> so no one in the press room was twittering -- no one was making note of the fact? >> others might have been smarter than i was about it. but it says something that the press corps is filled with smart men and women that it wouldn't occur to me that we left the men on the side. >> robert gibbs, the strategy here?

and no tv people were asked any questions. >> let me take this in two parts. i agree with peter. this is less of a strategy on the president's part and recognition from organizations that, you know, it's not just a man that can cover the white house. and a lot of very important news organizations have a lot of talented women that report on the president. in terms of the tv stuff, i mean, the problem if you're the president or press secretary if you are calling on the tv reporters if you call on one you have to call on five. so they made the decision at the beginning, even before they did prep they would do a certain number of questions and if you get through a decent number of print ones and i don't know how many questions were had, you do have to add five more if you do all of the tvs. >> are you saying tv people have thin skins, robert? >> me, no? i just think it's one of

those -- five questions likely means this thing goes another 20 or 25 minutes. >> you know how tv people can believeuate. thank you as always, happy holidays. >> you, too. take care. president obama told reporters that raul castro made fun of him for being long winded but not as long winded as president castro's brother. that's next on "now."

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this is still a regime that represses its people. and as i said when i made the

announcement, i don't anticipate overnight changes. but what i know deep in my bones is that you've done the same thing for 50 years, and nothing's changed, you should try something different if you want different outcome. >> that was president obama a few hours ago speaking at his final press conference of the year when he was talking about restoring diplomatic ties with cuba. how small a role castro seemed to play in the negotiations. whether fidel came up in the phone call with raul castro, the president said he did but only once. >> the only way that fidel's name came up, at the end of my remarks i apologized for taking such a long time but i wanted to

make sure that before we engaged in the conversation that we -- he was very clear about where i stood. he said don't worry about it, mr. president you are still a young man and you still have a chance of breaking fidel's record. he once spoke seven hours straight. but that was the only discussion of fidel we had. >> joining me is michael crowley. it's fairly amazing to me that fidel castro who is the poster child for the u.s. embargo and frozen relations with cuba had nothing to do with this moment. how do you -- when you heard that anecdote, what was your reaction? >> well, it was entertaining. you know, in kind of the cold war era politics, fidel castro's epic speeches were kind of a thing of legend and really

entertaining. but more substantively it is a useful story for him to tell because it points to the way in which you know, we've -- there's -- we've come so far with cuba, so much time has passed and it's just the old kind of legacy that our original policy was based on isn't really there any more. fidel isn't really in the picture. and so for -- the fact that fidel as a personality and icon and a figure of scorn and hatred for so many cubans and cuban americans is passing into history i think it makes it easier for the president to change the policy. it's not about a personality and ruler any more. yes, his brother is in charge but his brother seems more temperate and moderate and raul himself is 83. and i think that the president feels it makes it easier and more appropriate to change our policy. >> when he explained why he did

this he used the phrase "deep in my bones" i thought that sounded authentic. this idea of trying to bring back outliers, rogue regimes like the one in burma and myanmar and iran and libya this is part of the president's administrative dna from the beginning. and one would hope that the course of action cuba takes is more closely aligned with that of burma where granted there are problems but it seems to have been a good idea to engage rather than, say, libya. >> absolutely. and it goes back to the answer that the president gave in 2007 about would you engage these regimes without a series of pre-conditions and he said yes and everybody else pounced on it. you know, he's naive. he doesn't understand. what those people didn't

understand was that particularly, the democratic electorate wanted a different type of foreign policy. and i think, you know, when you've tried something as the president said for 50 years, the notion that you have old "b" roll of castro on a split screen with then president kennedy. that was in the 1960s. and i think the reason that some of this has changed, one, it's the most outdated, probably, aspect of our foreign policy the way we deal with cuba. but generationally, the politics have made this far, far different. i heard somebody saying the fact that there weren't huge protests taken you had done this 15 years ago, people would have marched in the streets in miami and little havana and the fact that didn't happen speaks to the nature of the fact that demographically things have changed and our policy must change with it. >> yeah, i mean reality is -- we

are running to the smack of a changing electorate and changing political climate. but that doesn't mean congress is going to do anything about it. the president said there would be healthy debate on what to do next on cuba. >> i don't know the last time i watched debate in congress that made me feel healthier than beforehand. there are things he can do to punch holes in the embargo. i saw something today, saying that there will be more holes than cheese with the executive orders. he will have to do a lot of that on his own. this question of talking to these kind of outlaw regimes there were three countries the president mentioned in 2007. there was iran, cuba and north korea. and in two of those cases he did

it. he started a dialogue and had positive results. the nuclear talks with iran and this breakthrough with cuba. but i wrote a story about this today. north korea is the nut that cannot be cracked. we have not been able to start a dialogue with them. and they are becoming a bigger problem over time. so that is the glaring interesting exception here. they really have resisted carrots and sticks. and that is the one failure of his vision, i think. >> to get back to the congressional piece of this, more holes than cheese, it would be less cheese if congress would lift the embargo. to continue, it's a weird thing that is happening in republican ranks. today especially you have outward aggression between marco rubio and rand paul on the subject of cuba.

rubio said many people who have been o'pieng, senator paul has no idea what he has been talking about. and if the embargo doesn't hurt cuba, why do you want to keep it. do you think the president senses an opening here to exploit republican disarray on this? >> well, i don't know about that. i definitely think the politics have changed on this. it nationally -- but they certainly haven't in a republican primary and that's what you see playing out between marco rubio and rand paul. for marco rubio it has to do with the fact up until the cuba news he had not been the big news this week. so i think there was an element to that. but getting back to what congress has to do. i think the president would be the first one to understand and he does, that you know, to place

an ambassador in havana will take senate confirmation. to get an embassy will take a congressional appropriate and an agreement from congress. and if you ask the president his likely answer would be those three things aren't at least going to happen until we start a change in our relationship and a dialogue. he may not be the president when all three of those other things happen but he will be the one that started it. >> i will say that the fact that pepsico and marriott wants to do business in cuba, it can have a sway in the congress. >> the chamber of commerce is for this. >> that's a little less cheese. robert gibbs and michael crowley, thank you. also big news on the environmental front. a fight years in the making has come to an end. i will tell you what it is coming up next. [ male announcer ] are you so stuffed up, you feel like you're underwater?

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as solid instead of hazardous waste. it will be up to the states to see how the ash is handled and disposed up. a victory for the $10 billion coal ash industry. coming up, they did not disinvited him from the state of the union address. so does this mean that president obama is in better with congressional republicans than we thought? more on that just ahead.

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both sides are going to have to compromise. on most issues, in order for their initiatives to become law i'm going to have to sign off. and that means they have to take into account the issues that i care about just as i'm going to

have to take into account the issues that they care about. >> president obama gave a hat tip to compromise and congressional republicans gave what amounts to a hat tip of their own by inviting the president to deliver his state of the union in the u.s. capitol building. i love what sort of amounts to compromise at this point. it's like we're going to let you give the address that every president gives every year, you're welcome. >> this president has been afforded so much less respect from the republicans in congress than we have seen ever in history. and now that they have both chambers or are going to have both chambers the question is how low can it go? >> we're still going to call you mr. president. how about that? you're welcome. >> on wednesdays. >> every other wednesdayly or monthly wednesday.

>> it's going to be interesting considering on what they ran on. they ran saying they wanted to end gender discrimination in pay and over the counter birth control and all kinds of things that sounded great. so now that they're in they're going to be office i'm certainly interested in what sort of agenda they actually put forward. i have a tough time believing it will bear any resemblance to what they campaigned on. >> ryan, the president seemed relaxed and tenacious at the same time as unencumbered as he has been in a really long time. and it's amazing your colleague sam stine tweeted this out, his pos pos post-shellacking press conference was decidedly different in tone. he found the lane he wants to

operate in which is like executive action, what does that poor tend for mitchell mcconnell and john boehner? >> mitch mcconnell made the bed he is sleeping in now. he is going to be senate majority leader but his policy or strategy of break congress in order to get there has meant that now, the president has this much more power. and what's going to be a lot of fun to watch is that now obama and house and senate democrats can use the same play that boehner and the tea party were using. obama will say to mcconnell and boehner say i would love to roll back wall street reform. but there's no way i can get that through my democrats i have over in congress and i know you don't have a majority. they don't have a functional majority in the house because there are always going to be 17 or 25 or so who won't go with

boehner because it is -- >> the act of governoring is a capitulation. >> it is. if obama can sign it, it must be wrong. >> the act of governing is a capitulation because it is governing in big government. i guess that's the logic. >> and the president has got his immigration agenda down and his net neutrality agenda. i think he's really feeling it these last couple years. >> is it cause for consternation that this is the new -- >> probably. >> the new standard is vaulting over one branch of government because it's broken. chris murphy said, relating to the president and isis, many of us believe that the president is operating outside the bounds of the constitution. there are a lot of democrats who would probably agree with that. and it's not necessarily a dig at the president. i think maybe more -- as it is,

an acknowledgment that something is broken and the executive branch has been put in a corner it shouldn't find itself. >> yeah, our rules and regulations are based on the idea that all three branches of government are attempting to govern. they are trying to work as we intended them to work and when one of them decides to work in opposition to that, we have to find new ways and work around things to do the basic needs of the country. >> but to ryan's point, if the old republican play book is a new democratic play book does this become the operating play book for the presidency? >> i think the two parties are coming at it from different points of view. republicans like this play book and want to prove that government can't work. when they succeed in failing, that's a win. i mean, it's up is down and right is left. democrats are saying something different and they have

different aims. so i think when you see democrats using the same tactics, that's not where they want to be. >> you know, ryan, another piece of this press conference that stood out to me, the president began talk about the economic good news, unemployment at 5.7%, 57 straight months of job growth. the average price of gas are $2.45 a gallon. these are statistics that any republican would have emblazened on a cape and attempt to fly off buildings with. this is the kind of stuff that should create a teflon dome around the white house, and, yet, for some reason it doesn't stick and maybe because democrats understand that wages have stagnated and are encumbered over why the middle class and poor have not been able to climb the economic ladder. how is it this is only

sporadically focused on? >> i think if it keeps up it will be very good news for whoever winds up with the democratic nomination. >> yep. >> and in a lot of ways it's up to saudi arabia and other countries if they keep gas price down, it's a stimulus because it increases your paycheck if you are paying less at the pump. it is pumping money into the economy. it's not going to benefit the president too much. people's ideas about him are fixed and he will stay around where his approval rating is now for the rest of his time buflt people don't care about that. the media and everyone else is shifting to who is going to take his place. but he is extremely powerful over the next two years. >> maybe if it gets worse the president will have to give the state of the union in saudi arabia in 2016. just ahead, it was the very

last question of the press conference, the subject is one of the most contentious of his presidency. we'll discuss it next on "now." they say 'i never thought you would quit.' but chantix helped me do it. along with support, chantix (varenicline) is proven to help people quit smoking. it gave me the power to overcome the urge to smoke. some people had changes in behavior, thinking or mood, hostility, agitation, depressed mood and suicidal thoughts or actions while taking or after stopping chantix. some people had seizures while taking chantix. if you have any of these, stop chantix and call your doctor right away. tell your doctor about any history of mental health problems, which could get worse while taking chantix or history of seizures. don' take chantix if you've had a serious allergic or skin reaction to it. if you develop these, stop chantix and see your doctor right away as some can be life-threatening. tell your doctor if you have a history of heart or blood vessel problems, or if you develop new or worse symptoms. get medical help right away if you have symptoms of a heart attack or stroke. decrease alcohol use while taking chantix. use caution when driving or operating machinery.

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president obama had plenty of good economic tidings to share with the american public this afternoon. for more on how the markets took those let's go to the cnbc market wrap. >> a lot of holiday cheer on the markets and wall street today. here's a look at the stocks. the dow rising 27 points. the s&p up 9 and the nasdaq higher by 20 points. >> that's it from cnbc. han tylel arthritis. so why am i still thinking about this? how are you? aleve, proven better on pain.

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i actually think it's been a healthy conversation that we've had. you're not going to solve the problem if it's not being talked about. >> that is president obama

showing optimism on race at the finish of his year-end press conference this afternoon. optimism that extends to the most controversial cases of police activity in recent months. >> sometimes you know, you have a police department that has got into bad habits over time and surfaced hidden biases that we all carry around. this isn't a situation where people feel good. seeing somebody choked and dying. >> the comments came just hours after st. louis county prosecutor bob mcculloch, the official who announced the decision not to indict police officer darren wilson, after bob mcculloch gave his first interview after the decision. he defended the timing and

lashed out at the action in the streets. >> i don't think it would have made a lot of difference. the people who were bent on destruction they were not demonstrators they were criminals. >> he defended his decision to let questionable witnesses take the stand including a woman who was trying to raise money for officer wilson. >> some that were clearly not telling the truth. >> joining me is joy reed and jamel buoy. >> the line, the vast majority of people are just trying to do the right thing, people are basically good and have good intentions. president obama said that in relation to race and captures the obama world view. how do you think of that as a response in terms of what is happening? >> a lot of people keep looking for barack obama to react to the

relation situations what a lot of people see in favor of the police and you can shoot a black man and is it a guarantee you are not going to jail. people want to feel that outrage from barack obama. but that barack obama, the most optimistic guy on race you're going to find with black skin, i think that's who he is, he is a fundamentally optimistic person on the experience of race. he has been able to overcome race as a barrier to success and he does believe with enough hard work we can overcome -- he just believes that. >> jamel he said at one point this is not a situation -- speaking of eric garner where people feel good about someone being choked and dying. i don't think anyone felt good. people felt outraged and felt like it was wrong and something needed to be done. and the president says there is an opportunity to take practical steps to tackle these problems. >> this gets to the unusual

position that barack obama -- president obama is in. i don't know how barack obama -- what barack obama -- >> the man. >> the man. the elected official is in a position where i'm not sure he can show that outrage. i'm not sure that's the place of an american president. >> and most people in the administration would say you can't have the president of the united states showing outrage against american law enforcement. >> his job in all of this is to try to say, no one is glad this happened. we need to look for constructive ways forward. i don't think that's adequate. but i'm also not sure i'm going to fault the president for having that stance. in part because i don't know what the -- the limits of the presidency are such that i don't know what else he could say. >> so, joy, does he leave it at -- he said other things, i have been confused for a waiter

or a parking valet. that's one thing but it's another thing for my would be son get arrested or robbed or worse because of the way he is dressing. those two things are different things. one is unacceptable and wrong and racist. the other is criminal. and the criminal piece is just something where it feels there needs to be a concerted effort to address how to correct that. >> and i don't disagree with jamel much, he was asked a general question, what is the state of black america? and so when you look at the construction of where he walked to get to the point where he was talking about policing. he started with education and went to incarceration and wandered through -- no we don't know everything that this man thinks inside of his head but we know there is a familiar path he takes to discuss race and it does have to with really believing fundamentally that the

answer isn't really to confront racism in a hard-charging way but to go around it with things like education. there is a tradition in the black community that believes that. on the issue of tackles

problems. >> he is a pragmatist. he is a politician. he approaches things from the point of politics. i think everything he does is rooted in. that. >> i think he believes if we are getting better he is one stop on the road to us getting better. it is always good to see you. thank you for being here in person, no less. coming up as the 113th congress comes to a close we bid farewell to michele bachmann. that is next. ♪ music

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after eight years, eight years of her unique brand of fact finding and truth telling, michele bachmann's congressional career has come to an end but not before a last interview in which she gave the secret to feeding progressives. >> they like to spin up false stories and false myths. they argue from emotionism and not from a logical linear point of view. that's the best way to defeat them, by the way, with evidence and with their false premises. >> and where else to destroy false stories and myths but in a worldnet daily interview. the media world will be losing one of its most dependable sources of internet breaking commentary. and we humbly present you the highlight reel of the bachmann

best. >> this moment is also bittersweet. >> freedom. >> because we'll be saying good-bye to a star of the 113th congress, michele bachmann. >> ime not always get my words right but i know my heart is right. the president does not want to have to be confronted with priorities in spending. not all cultures are equal. not all values are equal. >> the perilous battle that was fought in world war ii at iwo jima. we know we are not perfect but the founders who wrote those documents worked tirelessly until slavery was no more. >> when she ran for president she mesmerized. >> my name is michele bachmann

i'm a serious candidate for president of the united states and my facts are accurate. >> are you a flake? >> i think that would be insulting. >> i -- >> if that's your view of effective leadership with results, please stop. >> in the halls of congress, she fought tooth and nail to debunk liberal science. >> carbon dioxide is portrayed as harmful. but there isn't even one study that can be produced that shows that carbon dioxide is a harmful gas. carbon dioxide is not a harmful gas, is it a harmless gas. >> and then her stewardship of the tea party, that was famously slightly to the right. as in slight i to the right of the camera. but nothing animated the congresswoman more than the 44th

president of the united states, barack obama. >> barack obama has laid the table for an arab spring by demonstrating weakness. >> absolutely. >> he has anti-american views? >> absolutely. i'm very concerned that he may have anti-american views. >> obamacare, as we know, is the crown jewel of socialism. >> there are going to be people who die because of this. put the other handcuff on this lawless president's hands so we constrain this president from granting amnesty. >> michele bachmann's term is coming to an end. >> be assured my decision was not in any way influenced by any concerns about my being reelected to congress. >> no, she is leaving because her work here is done. obamacare has been repealed. >> i will not rest until i repeal obamacare. >> traditional marriage is law

of the land. >> the supreme court have not arisen to the level of god. >> and president obama was never re-elected. >> we're going to win. just make no mistake about it. president obama is a one-term president. >> actually, none of that happened. but when you're michele bachmann, who cares about reality. >> santa! >> congresswoman bachmann, we'll miss you. >> that's all for now. have a happy holiday and great new year. "the ed show" is coming up next. good evening, americans and welcome to "the ed show" live from new york. let's get to work. ♪ >> we cannot have a society in which some dictator some place

can start imposing censorship in the united states. >> billboards promoting "the interview" are coming down. >> they made a mistake. >> hackers working for north korea tormenting sony pictures entertainment for weeks. >> we can confirm that north korea engaged in this attack. >> the computer hardware traces back to known computer addresses in north korea. >> imagine what they start doing when they start seeing a documentary they don't like or news reports they don't like. >> sony has cancelled tours of the lot until next year because of security concerns. >> we will respond. >> good to have you with us tonight. we start with major develops in the sony north korea hacking story. today the fbi said it had extensive evidence that north korea organized the cyberattack that infiltrated sony computer systems. the fbi