on the broadcast tonight, star witness for the first time the assistant coach at penn state tells his story on the stand, tonight, what did he really witness? mad rush at the mall. if you thought stores were busy on black friday, perhaps brace yourself for this weekend. safe at home, once a role model for parents and kids alike, now an example of baseball's temptations. tonight, the question, does the punishment fit the crime? and making a difference, in this season of giving, some of the many people working hard to make sure every kid has a christmas. "nightly news" begins now. captions paid for by nbc-universal television >> good evening. he is a star witness in a

terrible story. so when he spoke today in court, his words carried great weight. mike mcqueary says he witnessed a terrible thing while he was assistant football coach at penn state, back before the name penn state became synonymous with this unfolding sex scandal and the former defensive coordinator jerry sandusky. the testimony is key to the case against two former penn state officials, senior v.p. gary schultz and athletic director tim curley who denied charges they lied to authorities. again tonight fair warning, this is tough material. the whole case has been that way from the start. we begin tonight with our national investigative correspondent michael isikoff from state college, pennsylvania. >> reporter: once the starting penn state quarterback, now a star witness for the government, mike mcqueary took the witness stand today and graphically described seeing a naked jerry sandusky engaged in what he called extreme sexual activity with a young boy.

"the boy was up against the wall" mcqueary testified. "jerry was directly behind him in a very, very close position. i believe jerry was sexually molesting him." mcqueary slammed his locker door shut causing them to separate and directly look him in the eye. athletic director tim curley and senior vice president gary schultz, both charged with lying about what mcqueary told them about the incident and failing to report it to authorities. mcqueary acknowledged he never actually saw any sexual intercourse and never intervened. "i was shocked and horrified," he said "and to be frank with you i probably was not thinking straight." >> mcqueary was a great witness, very clear, articulate and very sincere and very respectful. >> reporter: prosecutors read from joe paterno's grand jury testimony. paterno told mcqueary only said he had seen sandusky with a youngster doing something of a sexual nature.

paterno didn't push mcqueary for details. he passed along to curley who along with schultz met with mcqueary a week and a half later but never took any steps to investigate. defense lawyers hammered mcqueary over why he never told police. noting schultz's position, "i thought i was talking to the police." late today judge william wenner ruled the testimony from mcqueary and others was enough to take the case to trial. >> we're joined by savannah guthrie, our nbc news chief legal correspondent, and other than the gross alleged details in this case, what changed materially today? >> well i think we really saw what may turn out to be some of the most powerful evidence against not these two penn state officials, them, of course, but also, jerry sandusky. it is so rare in a sexual assault case to have an eyewitness to an alleged crime and that's what mcqueary says he is. so we saw here he is giving a

very vivid, detailed narrative. i would make one caution which this is the early stage, just the preliminary hearing. prosecutors only had to put on the barest of evidence to establish probable cause for the charges to go forward and defense attorneys were somewhat limited in their cross-examination, so we haven't really seen the full throttle attack on the testimony mcqueary gave that we will see if this case indeed proceeds to trial. >> for folks who haven't been following the machinations of this, what was the decision sandusky's team reached earlier this week? >> they said bedon't want to go forward with a preliminary hearing. if they had we would have heard from mcqueary and several of the alleged victims in this case. ultimately it was a trade-off for these defense attorneys. on the one hand, they don't have to have days and days of bad publicity, all these detailed narratives come out but they missed an opportunity because they didn't get to lock these alleged victims into testimony which they could later cross-examine on trying to say oh, there are inconsistencies that, kind of thing and they missed the opportunity to size up the demeanor and credibility

of these alleged victims in court. >> savannah guthrie, thank you, as always, for being with us on this. now we shift our focus to washington, and some big news out of that city today. two former ceos of mortgage giants fannie mae and freddie mac were hit with accusations of fraud by the sec. fannie and freddie collapsed during the financial meltdown back in '08, leaving taxpayers with a staggering bill that grows larger by the day. nbc news senior investigative correspondent lisa myers has our report. >> reporter: three years ago the former ceos of fannie mae and freddie mac infuriated a congressional committee by denying any blame for the financial crisis. >> we thought we made the right decision at the time. >> you have exhibited no sense of accountability for your actions here, none. >> reporter: but today daniel mud of fannie mae and richard

syren of freddie mac were accused of civil fraud. the sec alleged they and four other executives made false and misleading statements to conceal the extent of risky subprime mortgages. >> today's action is about holding individuals accountable for their role in misleading the public. >> reporter: who got hurt here? a lot of hard-working americans saving for retirement. >> fannie and freddie were two of the most common companies that the average guy on the street invested their retirement income in, and their retirement accounts took a real hit. >> reporter: when the companies imploded, taxpayers had to bail them out, to the tune of $150 billion. these are the highest profile individuals facing legal action in conjunction with the meltdown, but it's not likely to satisfy outrage that no big players on wall street have been criminally prosecuted. >> none of them is even under indictment.

indeed, there does not appear to be a serious investigation of any of them. >> reporter: the former ceos emphatically deny any wrongdoing and say the allegations are without merit. they insist they fully disclosed all risk to investors. mud said he looks forward to his day in court, where the standard is "fairness and reason, not politics." lisa myers, nbc news, washington. and in a california courtroom today, a surprise when a federal judge handed down the sentence for the so-called home run king, barry bonds, convicted of lying to a grand jury in a case involving steroids and baseball. it's what didn't happen that has a lot of people asking tonight if the punishment fits the crime. our justice correspondent pete williams is in our washington newsroom with more on this. pete, good evening. >> and brian what didn't happen is any prison sentence, in this latest setback for the prosecutors who have spent millions of dollars investigating the use of performance-enhancing drugs in professional sports.

barry bonds' sentence is on hold while he appeals his conviction for giving rambling testimony to a grand jury looking into abuse of steroids in baseball. prosecutors said 15 months, instead he got 30 days home detenti detention. this case began going south in april when a jury declined to convict him of lying about whether he used steroids. prosecutors had given up on trying him for that. over the summer a federal judge declared a mistrial against pitching star roger clemens. the government will try again in april. prosecutors managed to get 11 convictions in steroids cases ending with probation or months in prison and many applaud the government for sending the message about the dangers of steroids but some in sports and the law wondered if this was the best use of federal resources. >> pete williams at the intersection of justice and sports tonight, thanks for that. an con capitol hill in

washington the house passed a spending bill needed to keep the government up and running but there is still a lot of work to do by the end of the year. we're joined by nbc's kelly o'donnell from the hill, good evening. >> reporter: good evening, brian. first no government shutdown, that's done because house republicans and democrats came together over whelmingly to pass the nearly $1 trillion spending bill that covers more than a dozen government agencies and included in that is the fate of your household light bulb. republicans fought hard to get rid of the money to enforce the more energy efficient kind. they said government was reaching too far into everyday life. democrats said they're not making those bulbs much more so no effect. the other big priority, the payroll tax cut and unemployment benefits extensions. we're being told there's a tentative deal for just a two-month extension and would include something republicans fought very hard for and that's a provision dealing with the oil

pipeline project they say will create jobs, the president wanted to push that off so there are developments, they may all be out of here by the end of the weekend. >> kelly o'donnell on the hill tonight, thanks. it is a crucial time, as you may know in the gop primary race for the nomination. the final debate before the iowa caucuses was just last night. now it's a sprint to the finish, while trying to hold everyone's attention over the christmas holiday, nbc's chuck todd reports on what happened last night and what's ahead. >> governor? >> reporter: trying to look like a front-runner again, mitt romney picked up the support of tea party favorite, south carolina governorckkien is haley. >> he's already a leader and know what to do the first days in office and ready to do it. >> reporter: after a week of attacking newt gingrich, last night romney held back. >> it's president obama we've got to be talking about. >> reporter: newt gingrich also played nice. >> i sometimes get accused of using language that's too strong, so i've been standing here editing.

i'm very concerned about not appearing to be zany. >> reporter: the real damage to gingrich may be coming from tv attack ads blanketing iowa. >> -- gingrich was fined $300,000 for ethics violations. >> he's demonstrating himself to be the essence of the washington insiders. >> it's about serial hypocrisy. >> reporter: perhaps the most aggressive last night, michele bachmann who took on the surging ron paul over the issue of iran's pursuit of nuclear weapons. >> we ought to sit back and think and not jump the gun and believe that we are going to be attacked. >> i think i have never heard a more dangerous answer for american security. >> reporter: bachmann also went after freddie mac. >> when the speaker had his hand out and taking $1.6 million to influence senior republicans to keep the scam going in washington, d.c. >> reporter: gingrich dismissed her charges which clearly upset the congresswoman. >> i think sometimes people ought to have facts before they

make wild allegations. >> i'm a serious candidate for president of the united states, and my facts are accurate. >> reporter: asked today whether she considered gingrich's rebuttal sexist? she would not rule that out. all that with 18 days to go before the first votes are cast. chuck todd, nbc news, washington. and when our broadcast continues on a friday night, why this could be a make or break weekend for a lot of folks. and later, the soldiers on the front lines of christmas for a lot of kids who are counting on a visit from santa. ♪ ♪ [ male announcer ] everyone deserves the gift of a pain free holiday. ♪ this season, discover aleve.

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and don't get heartburn in the first place. available at walmart. retailers have nine days left to eat up a lot of ground and conveniently shoppers have that same time remaining to cover a lot of ground before christmas. that's why this is going to be a busy and crowded weekend out there, starting with the mall parking lot. nbc's tom costello in reston, virginia, for us tonight. hey, tom, good evening. >> reporter: hi, brian. we're at a great spot here because it includes an outdoor skating rink in the shomg area. you know the current sales slogan, nobody pays full retail anymore? a lot of people are taking that to heart. they're demanding big discounts both online and in the stores.

retailers are desperate this weekend. they want to get shoppers in and merchandise out. if you thought the stores were packed over the thanksgiving weekend, and they were, then prepare yourself for tomorrow, on this last full weekend before christmas, some of the biggest retailers are slashing prices to lure in those shoppers who haven't yet finished, from the promenade in santa monica -- >> i haven't bought anything for anyone yet. >> i don't have a strategy yet. i think when i get to the stores i'll figure it out. >> reporter: to the magnificent mile in chicago. >> anything over 50% i feel is a good deal especially like being a student, i need those sales. >> reporter: while store sales soared at the weekend after thanksgiving, we have since suffered the biggest drop in 11 years, with americans struggling through a rough economy while still carrying high levels of debt, retail annist dana telsey is on a ten-city tour gauging holiday sales. >> we found promotions drive

traffic. on average the average promotion is around 40% off. >> reporter: still since lower than expected sales since black friday, the national retail federation has actually raised its holiday shopping forecast, now expecting a 3.8% increase in sales over last year, but for that to happen, this weekend is critical. since the saturday before christmas falls on christmas eve this year, many retailers are calling tomorrow super saturday. in salt lake city, overstock.com was itself overstocked, and just auctioned off an entire warehouse for pennies on the dollar, and with consumer spending accounting for 70% of the economy, what happens in the next week is critical. >> the stakes are huge, not only for retailers but for all businesses, it sets the tone for activity as we make our way into 2012 whether business also broadly go out and invest and hire and that's vital to the economic recovery. >> reporter: vital to the economy he says. we talked to a lot of retailers, to target, to walmart, jcpenney,

macys, abercrombie, the gap, you name it, many are talking about extended hours in the run-up to christmas, deep discounts and the sales to start big time tomorrow. >> tom costello, going to slip in shopping if not skating while being able to say he's on assignment for us tonight, well done. tom, thanks. up next here tonight a man who often made the world think even if he didn't make a whole lot of friends in the process. this was the gulf's best tourism season in years. all because so many people wanted to visit us... in louisiana. they came to see us in florida... nice try, they came to hang out with us in alabama... once folks heard mississippi had the welcome sign out, they couldn't wait to get here. this year was great but next year's gonna be even better. and anyone who knows the gulf knows that winter is primetime fun time. the sun's out and the water's beautiful. you can go deep sea fishing for amberjack, grouper and mackerel. our golf courses are open.

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greatest vocalists of all-time. etta james is 73 years old. christopher hitchens was died. he was born in post-war britain but became an american citizen. he was the author of over 20 books and he read thousands more. he was a scorched earth polemicist, a trotskyite, atheist, and a lot of people found him hard to like and impossible to pin down and that's exactly how he liked it. he was a big supporter of the war in iraq, criticized mother teresa as a fraud, and he chronicled his own by kibikini waxing. he would debate with anyone and he usually won. he hung out with other smart writers, mostly brits. he drank and smoke like an olympian and paid for it, he died of esophageal cancer just like his father did. christopher hitchens gone at the age of 62. while it took a british

newspaper to show us what's happening in our own neighborhood, look at the photos from a giant rising aboveground zero. it's one world trade, up to 90 stories with 14 more to go and already on a clear day you can see forever and in a city of giant this is new giant is already visible from all five new york city burroughs. up tonight, the young man who popped the question is the first lady. the family thinks i'm out shipping these. smooth move. you used priority mail flat rate boxes. if it fits, it ships for a low, flat rate. paid for postage online and arranged a free pickup. and i'm gonna track them online, too. nice. between those boxes and this place, i'm totally staying sane this year. do i smell snickerdoodles? maybe. [ timer dings ] got to go. priority mail flat rate shipping at usps.com. a simpler way to ship. nyqui tylenol: me, too. and cougnasal congestion.ers?

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in this season of giving today, first lady michelle obama reminded us all to do our part for the needy and set an example by delivering a big red sack of toys from the white house staff to the u.s. marine corps toys for tots campaign. as she was sorting through the toys, the first lady got asked out, a young marine invited her to next year's marine corps ball. she said she'd love to go, but has to ask her husband. the toys for tots program founded by the marine corps has been making a lot of dreams come true for boys and girls in need for over six decades. tonight around the country, marines and hoards of volunteers

are scrambling for a spike in requests. our report from ron mott in boston. >> reporter: marine sergeant matt laroche last christmas was surrounded by the taliban in afghanistan. this year he's surrounded by footballs, ball games and dolls as coordinators for boston's toys for tots drive. >> this year's christmas and last year's christmas were very different. i was deployed to southern afghanistan, didn't really know it was christmas except for the care packages that i got from the, you know, the loving kids. >> reporter: with nine days to go before kids rip into all this fun, the mad rush is on to get toys to them. today in new york, anxious i didn't think youngsters were thrilled for the toys, reaching in one case for the arms of a marine. back in boston volunteers sorted, bagged, before sending them back out with big smiles hoping even bigger ones are to

come. >> i know it's the thought that counts but it's nice to have something to open on christmas. >> reporter: a year ago this chapter distributed nearly 140,000 toys. they're worried they won't be able to meet the surge in demand. across the country 1.5 million more kids are on the list for toys. officials say the increase is about 30%. >> the demand right now is very big, with the unemployment out there. >> reporter: though the economy is still clearly sour, this marine says there is clearly something sweet about returning the favor from all the care packages they receive during war. >> now i get a chance to give back to the kids. >> reporter: giving as good as they got. ron mott, nbc news, boston. >> there you go. we want to let you know every night next week we'll have a making a difference follow-up report. we'll show you how some of the folks who have seen the stories we've aired have stepped up to help others in need. that is our broadcast for this friday night and for this week. thank you for being here with us. i'm brian williams.

lester holt will be here with you this weekend. we, of course, hope to see you right back here on monday night. in the meantime, have a good weekend. good night. -- captions by vitac -- www.vitac.com