on this christmas sunday, a special conversation about the state of the country. and a look ahead. our own 2012 playbook, with keys to the new year. the presidential campaign, taxes, the economy, and jobs. national security, and other hot topics like health care and immigration. what you shoul look for in 2012. the major players, potential outcomes, and the biggest unknowns. with us, nbc's special correspondent and author of the book "the time of our lives, tom brokaw. "new york times" columnist and author of the book "that used to be us," tom friedman. president of the national urban league and former mayor of new orleans, marc morial. and columnist for the

washington, kathleen parker. and in a special christmas day reflection, we'll hear from the former archbishop of washington, cardinal theodore mccarrick. >> christmas day is a season of hope, a season of expectation, a season of love. >> good morning. and merry christmas. 2011, almost behind us now, so many key questions as we head into the new year, and for the next hour we've aacceptled a terrific group to talk about the year ahead, and a reflection on where the country has been this year. joining me, nbc's tom brokaw. tom friedman, kathleen parker. marc morial. welcome to all of you and merry christmas. >> merry christmas. >> merry christmas to you. >> i suspect, tom brokaw, that families are getting together on this holiday, and there's gifts and there's good times but there's probably a little talk about where things are. in their family, in their community, and in the country.

and if you look at one key indicator, it's pretty downcast. the direction of the country. and look at the polling from "the wall street journal" slbs nbc news poll. nearly 7 in 10 americans think the country is headed on the wrong track, in the wrong direction, and as economic anxiety seems to make this so much deeper than other periods of turmoil. >> well, that's because economic confidence, and economic security is the underpinning of well-being in the country. in 1968, which i loved through, there was enormous turmoil. but everyone could get a job. we still had a manufacturing base in this country. and even though we had guns going on in vietnam there was a lot of money around. now, you have homeowners sitting out there, even with a home that is worth less than their mortgage, or in peril of becoming that or it's an utter foreclosure that represents their net worth in many instances and there's a real kind of terror in their lives. moreover, beyond the homeowner piece of it, i think the rest of the country just feeling that

they're not included in a lot of what is going on. that the political debate on the republican side seems to be confined to a reasonably narrow group of people who are driving that dialogue, and the democratic side seems to be kind of cordoning itself off from the middle, that helped get this president elected. so i think there is good reason for a lot of anxiety out there. >> and a lot of anger, kathleen parker. i mean if we've seen anything to define our politics, it is pure anger on both the right, the tea party, and on the left, there's occupy wall street. >> well, i do think -- absolutely. you know, the truth is the tea party and the occupy wall street people are really two sides of the same coin. one is against big government. one is against crony capitalism. and the truth is either the successful candidate will pull those two people, those two groups together and help dissipate that anger. i think the frustration is simply feeling that not only is there nothing happening in the congress, but nothing's moving forward, but that they don't really have any way of

influencing outcomes, but the truth is, they do. and you know, the fact is, when you look at the gridlock in washington that everyone is so mad about, it's really gridlock by design, when you think about it. because in 2010, the election pushed the republicans in to take over the house. and that was really a check on obama. if you look at it, we have two big political movements in the last two elections. one in the 2008, it was a shift to the left, in 2010, a shift to the right. but 2012 is really a tiebreaker. and the big question is whether the american people are ready to fire president obama. and that's the big one. >> one of the big questions, though, again driving this idea of how cynical people are, how negative they feel about the country, is whether the country's in decline, tom friedman, or whether just too divided. is it income inequality? or is it something bigger going on in the country? >> you know, i think, david, as we step back, i think we can explain a lot of what's going on in the country and in the world by the fact that we've actually gone from a connected world to a

hyperconnected world. and what that has done actually, if the world were a single math class the whole global curve has risen. because every boss today has access to more cheap automation, cheap software, cheap robotics, cheap labor and cheap genius than ever before. and as a result, average is over. average is officially over. we've all got to find our extra, come with something new and extra to the table. so on one end that's creating a lot of the anxiety understandably throughout the population. but at the same time, it's giving people the tools to organize and protest against it from the right and the left. at the same type the hyperconnectivity is creating huge income gaps, because if you do have the talent, if you are really, really above average, if you're j.k. rowling, you can now make more money in a totally connected world than ever before. it's all wrapped up together in one process. >> marc morial, i mean, this is christmas, and what does it represent, if not hope? and yet tom referenced this, for so many americans who own a home, their nest egg was the ek

w equity in their home. for too many americans that's gone. and frankly, it's not coming back. that really dashes a lot of hope. >> you know, the an remember that americans feel, i think, is accelerated by the fact that the middle class is evaporating. that the recession has created a greater income inequality than ever before. white americans lost 16% of their net worth in the recession alone. african-americans, 50% of their net worth. you've got a disappearing middle class. and the middle class and upward mobility, and the sense that no matter where you were born in this nation, you could rise to the next level, and that it wasn't by jumping over a giant hill, or a giant wall, has really been, i think, the lubricant that has helped to sustain this nation. so on christmas day, i think americans are not only looking at the fact that they've lost

their home, many have lost their jobs, but it's like the woman that i ran into on friday who said, i'm a laid-off teacher, i do have a job. but i'm now a cashier at a grocery store. can you help me teach? i want to teach. so you have many americans, and the unemployment rate does not tell the story, so of the anxiety that many are experiencing, i think, today, is the sense of will it get better? will my condition in life, and my family's condition, really improve, no matter what happens in the election of 2012? >> so we talk about the keys to 2012. and the presidential campaign is going to be a huge factor. is this conversation happening in the course of the campaign? >> absolutely. but i do want to say one thing. you know, the damage to the middle class is real. you can't argue with statistics, that people have lost their homes and the pain they feel from the lack of good jobs for people. but there's a new -- there's new, you know, a new report came out recently from gallup that had some very interesting statistics.

and that one of them was that while we talk about income equality and the president is certainly advancing that narrative, the american people really don't see it that way. the majority does not feel that income equality is the big problem that it's being advanced . and the other thing, the other kind of interesting thing that may influence how the election goes, the general election specifically, is that democrats, more democrats think that big government is the problem. suddenly, they're seeing government as the problem, rather than republicans. so that's just an interesting thing to watch. >> david, i actually think it's not just anger. it's cynicism. in part because almost everything that they've been told in the last five years turned out not to be true. and if you go back farther than that, about how iraq and afghanistan would work out and how swiftly it would work out, and then when the recession began, we can work our way out of that, and they were told, officially, that it was over in the spring of '09. oh, really? if you go out to the manufacturing areas, or you go into a lot of the subdivisions in this country, they don't think it's over.

so they have withdrawn now, and they look at everything, i believe, with a much more jaundiced eye. and in my book, i write about something that i had not heard in the 50 years that i've been a journalist, and that would be parents and grandparents coming up to me and saying, i don't think my children are going to have the lives that i've had. i've just never heard that before, because that goes right to the heart of the american dream. and what i try to do is recalibrate the answer to that. and say, it's always been a quantitative answer, will they make more money, will they have a bigger house, will they have more toys, more cars. we've learned there's a price for that, and there's a finite capacity. so i -- what we're not hearing in this debate, i think, is the recalibration about more economic justice, for example. we know that education is going to be the currency of the 21st century. there's been almost no discussion of that on either side about what we need to do to raise the level of education so everyone will have the skill set to compete in that hyperconnected world that you described. >> but we're coming upon the election season fast and furious.

i know we've been talking about it for a long time. but the voting actually starts here pretty soon. and here's a blast from the past. 1998, the headline in "the washington post," gingrich steps down as speaker in face of house gop rebellion. that was 1998. and the cover of "time" magazine, november 16th, 1998, the fall of newt, and on "newsweek's" cover that week, "the loser." and tom friedman, on the day of the iowa caucuses, it will be 13 years to the day since it was speaker gingrich's last day in that job. what a comeback. he's going to be somebody to watch. >> well, you know, i'd say a couple things about it. one there's a journalism lesson here which is never be smarter than the story. when the story is speaking to you, shut up and listen. and i think newt's rise is speaking to us. and what it says to me is -- is that i think there's a lot of republicans who are starved for a candidate, for their party, who would be able to debate obama head-to-head.

they think he's a smart and mellifluous as the president. i think that's a lot of what is driving it. the other point i want to make, just to wrap up and react to my colleagues here is that as bad as things are, what's really sad is that with just a few big political decisions we could be on a whole different track. okay? if, you know, president obama and the republican leadership could agree to meet on just two things. one is a small stimulus bill, focused on getting more young people to vocational school and four years or two years of college education, and infrastructure for our cities, and then, for me simpson-bowles, a long-term fiscal plan to resolve our problem, you'd see the stock market go up 1,000 points, you'd unlock an enormous amount of investment here, companies would hire again. i think the country today is not only economically down, but it's emotionally depressed. we feel like we're children of permanently divorcing parents. and in this environment, a lot of people just are holding back. >> david, i think -- >> i really think that one thing that people don't want to

acknowledge is that underlying this, there is a divided nation. underlying this is a real debate going on about the role of government. there's a debate going on about the american future. there's a debate going on about our role in the world after, in effect, spending almost a trillion dollars in iraq and losing 4,500 soldiers, and what next. there's a real debate going on. and we have to acknowledge the fact that the political system, which may play out in a presidential election, where people are fighting on base maximization, and a narrow set of voters in the middle, doesn't spur the kind of conversation that we need to have about the priorities for the 21st century. and that's the kind of discussion i hope we'll see. and i hope that when issues are joined, when the republicans nominate someone and the president is head-to-head, there will be a real debate about the future of the nation. >> i might just say one thing, though, i don't think there's a narrow base in the middle. i think the country is so much

less divided than our politics and politicians. i think the biggest unrepresented tea party in this country is basically are the center left and center right. >> i agree with you completely. >> yeah. >> completely. >> i agree, as well. these are the people, by the way, who elected obama. >> exactly. >> and they feel betrayed by him, and they feel abandoned by him. >> no one group of people elects anyone. what happens in a presidential election, as in all elections, is who can assemble the best coalition. and it requires a combination of factors to win. one of the things that's going to be an issue this year that is the assault on voting rights. the fact that you've got 34 states that are trying to, in effect, make it more difficult for people to work and what effect that's going to have in the important states. but i think that we need to understand that presidential politics today is about coalition building. and who can basically put together a big coalition enough to get -- >> but let's go back, make your point, but also reflecting on, you know, who we're going to

look for in presidential campaigns. on the republican side of the ledger, you have this gingrich story that's going to be a big part of the early part of the year. >> i have this old-fashioned idea that we ought to have some votes cast before we make these judgments. that we ought to know what happens. what would a columnist do -- >> right, right. >> but i do think that that, you know, i remember being out in iowa when howard dean, on the sunday morning of "meet the press," looked like he was going to win iowa and john kerry had a theme going and blew him out, and then went on to new hampshire and howard dean was over at that point. i watched iowa turn out pat roberts at one point. george bush 41 beat ronald reagan in a state where ronald reagan had begun his broadcasting career. so there can be surprises. we're playing by different rules. we were talking to one of gingrich's guys the other day, he doesn't have to have the money in the organization anymore, twitter will help get him to where he wants to get to. so will the online piece of it. i don't know exactly what's going to happen in iowa but i do

know that newt in the moment very much is out front on the ballot. i believe it's in part because he's very cleverly in all these debates attack dog. this is the big, anti-establishment mood out there. whoever is against the establishment, i'm for him. and he does it very cleverly. >> i have to say something here, though -- >> no, no, go ahead. >> well, the thing about newt, it's interesting that he has emerged as this front-runner as a result of the debates that people have watched and seen how he kind of manages the team, and i think there's a real desire to see him debate, as somebody said. they want to see him debate president obama. let's back up and be realistic about newt gingrich. once people start looking at him carefully and see his relationship with freddie mac and the money he's earned, which he downplayed, which is typically not straightforward if we can say that. but also, he's got, we talk about the baggage. the baggage is significant. i mean, both in his personal life and his professional career.

>> and on "meet the press" in may, he made an observation that's indeed coming home to roost about himself. watch. >> i think it's fair to say that i'm going to have one on the campaign trail. it's going to be whether i have the discipline and the judgment to be president. i think that's a perfectly fair question. >> self-awareness there. >> right. and he, you know, he's presenting himself as this great intellectual. but he's kind of, you know, there's some low-brow kind of low-balling approaches to issues such as, i mean, he wants to create a constitutional crisis right out of the gate by hauling judges in before congress with whom he disagrees. i mean that's a pretty -- >> the other piece of it, and again, this is anti-establishment piece but i don't know how it's going to play but you have tom coburn and no one could question his credentials or peter cain from new york and others who serve from the house saying no way, we don't want this guy as our president. does that help him? it may, in fact, because, again, these are establishment people who are in office, who are coming after -- >> every time something in

washington says something negative about newt it helps him. >> marc, morial, i had a prominent republican say to me, if newt gingrich is the nominee, there is no way this campaign is going to be about barack obama. >> right. >> i think they will be happy to have a very, very long record, and if he can pull a magicians trick in the primaries and say, i'm not part of the establishment, it's going to be difficult for him to do it in a general election if he's the nominee. because newt gingrich has been around american politics for 25 to 30 years. he's got a legislative record. he's got a record of speeches and public pronouncements. he's got a personal record. and it will be, in effect, part of the campaign. >> but we could point out, about waiting for the voting to start, and what's different, tom, about 2012. it is not winner take all in all these states. a small percentage of the delegates will actually be apportioned after the first four contests. mitt romney understands, he may have some problems with debates. he's got money, he's got organizations, and he can draw this out.

>> yeah the other thing is he could draw this out. we could get to a brokered convention. if this gets downstream in the current mode there are a lot of old establishment republicans who are going to be going to the state house in new jersey and saying to governor christie, you've got to get in on this. they've got to find somebody else who can be a player, or, i think, outside of that, you're going to look at a lot of possibilities of third party candidates jumping in -- >> that's most likely -- >> -- on twitter or in a smoke-filled room. that's where -- >> and that actually gets something on the democratic side, as we talk about the president's record, on trying to improve the economy. "time" magazine's person of the year was the protesters. this is what it looked like on the cover. and tom friedman, you've talked about this as being more than a foreign policy story. this, you know, represents tar irsquare and the arab spring. but there's something larger that's companying in the economy all over the world that affects

president obama's re-election chance. >> we're seeing the democratization of so many things. the democratization of information, which means democratization of weaponry, is becoming super empowered. we're seeing the democratization of innovation. tiny groups can now take on big companies and most of all we're seeing the democratization of expectation. everyone, whether you're in tahrir square or india or israel or wall street feels they're entitled to the same rights, participation and justice. and when all these people feel this, you've got just enormous energy now coming from the bottom up and i think it's going to be a huge leadership challenge for everyone to meet these expectations. it's what i feel about, you know, the arab spring sometimes when i look at what's unfolding there nowadays, it is that i feel like two things come to mind. it was inevitable, and too late. you know, on the one hand it feels inevitable. on the other hand, the catching up, all of these people have to do, it's going to be enormous. and leaders who can manage those expectations, generate them and

to channel them in the right direction -- >> it's the leadership challenge of our time. >> how has president obama done in managing expectations on the economy, that yes, he inherited in crisis, but here he goes in to a re-election year with it very much in distress? >> i think that, first of all, i just want to make the point, i think the president kept his promises on foreign policy. and i think the economy has been much more stubborn and much more difficult. it has to be said in the most recent months, the president has had, if you will, a small stimulus or a small economic growth proposal called the american jobs act, that's basically been filibustered in the senate with one or two provisions that have, indeed, been passed. and i think what the election will really be about is whether people would be better off if, in fact, you return to bush era economic policies. i think economic issues are going to be on the table, and i think people will have a choice, because whether it's mitt romney, or it's newt gingrich,

or it's anyone, i think that their economic plan is more of a return to slashing budgets, cutting taxes for the wealthiest americans. the type of things that i think helped to produce the economic debacle that we're suffering through right now. >> it's interesting, because this question about american decline, and whether, tom friedman, we'd be talking about another story, if we weren't caught up in our politics, and the outgrowth of 9/11. listen to mitt romney from one of the fox news debates earlier this month where he talks about the future of the economy, the future of the country. watch. >> this economy has every potential to continue to lead the world. our president thinks america's in decline. it is if he's president. it's not if i'm president. this is going to be an american century. >> i think that is a real wedge in terms of how you argue america's purpose in this election. >> well, you know, i think actually the country gets it. they understand where we are. they understand it's a new world.

i think they're looking for three things from the next president. one is, do you have a plan for the type of scale of the problem. an honest plan. they know we have to cut back. do you have a plan that's to the scale of the problem. second, is it fair? okay the wealthy have to pay more. they've had a great two decades but everyone should pay something. this is a national project. you know, it's got to be fair. and lastly, is it aspirational. is it just about balancing the budget? i'm not -- i'm a fourth of july guy. i think the country is a fourth of july country. they're ready to sacrifice but to make the country great again you have to balance the budget. i think that's the candidate that gets there can really win the election. what i fear is we're going to have an election that one side or the other wins by 50.001% of the vote because they're able to smear the other just a little bit more than the other guy, and we will not have the mandate to do what we need to do. >> does obama have to go big as president? >> he does. i don't think there's any question about it.

i think part of the problem that he's had up to this point until recently is that we didn't know which president obama was going to show up from week to week. where he was going to go, how he was going to do it, rhetorical in terms of his policies. now they seem to have settled on a line and they're going to pursue it through. i've been thinking about this recently, having spent a lot of time in the country, i think this country is ready for, yes, and not for no. we've been spending a lot of the last couple of years dealing only in no. we're not going to go there. we can't do it. i think the country wants big, bold ideas. and they have to be rooted in the practical constraints of the economy. >> but isn't the problem, kathleen, that the president takes over as president, at a time when there was a real backlash against government about government bailing out the banks and whatnot, and then you ask government to do more. it fights that idea of saying, yes to more, when people are losing faith in the government's ability to carry out some of these big things. >> and hence the news figures, the latest figures from gallup.

and it is a real predicament. i agree with so much of what tom said. there has to be some big idea and there has to be some, i think the american people really desperately want to see our elected officials come together, and with some plan that works to the scale of the problem. >> and the other thing is, david, it is not just about government. there's this whole movement going on across the country, public/private, in indiana in education, and georgia, in chicago, and across the country, the private sector is coming in and partnering with the public sector and getting the big jobs that need to be done and reducing the inefficient government agencies that exist out there. new york state has 11,000 state agencies. so many of them could be eliminated and you could be contract players with the private enterprise. that's a big, bold idea that doesn't advance the big behemoth of government moving in on our lives. >> i agree with what tom has said, that is at the state and local level you see a greater degree of cooperation.

you see public/private partnerships. you see efforts to take matters into state governors and mayors and county executives own hands, working with labor and business. i've seen it in ohio. i've seen it in -- down in georgia, in dekalb county where we're working on a project. the other thing i want to make, in terms of going big and being aspirational. i agree with it. but i think the people want a president who can squarely look them in the eye and say mesh cannot be involved in two and three wars, we can't have every tax loophole and every tax deduction we want, we can't spend money on every program that can come to mind, but what will the priority be? it's got to be economic growth. it's got to be educating our kids. it's got to be creating a secure economic future here at home. the last decade has been a decade where there's been lower taxes, for the wealthy, two wars undertaken, a continuation of

spending. bailouts of the banks. you've had all of these things, some that instantaneously people supported at the time they took place. but, the record shows we did so many things, tried to do so many things, that the future's got to be about a leader saying what is our priority and what should we do in the 21st century? >> let me take a break here. we'll come back and talk about more of this 2012 playbook. national security and other hot button issues in the new year. what to look for. the biggest unknowns. we'll continue our discussion right after this. we know why we're here. ♪ to design the future of flight, inside and out. ♪ to build tomorrow's technology in amazing ways. ♪ and reshape the science of aerospace -- forever. [ female announcer ] around the globe,

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get in the car. get in the car! [ male announcer ] the epa estimated 42 mpg highway chevy cruze eco. from spending time together, to spending your lives together, chevy runs deep. we are back to continue our special discussion here this morning with tom brokaw, tom freedman, marc morial, and kathleen parker. and especially around the time of the holidays, when we're so thankful for our men and women serving in wars around the world. these scenes are so heartwarming. this is oklahoma city, oklahoma, and our returning heroes coming from iraq, and afghanistan. one of our producers flew in to dallas and called us, saying it was one of the most beautiful things she'd ever seen to see troops returning to dfw there in dallas. and as the iraq war is officially over, u.s. troops have left, look at this polling information, tom friedman, from our nbc news/"wall street journal" poll, about accomplishments for the president. number one, 27% say killing

osama bin laden. number two, bringing all the troops home from iraq. indeed, killing osama bin laden was voted the top news story of 2011. he has turned out to be a foreign policy president, has he not? >> well, i think, you know, what's interesting about this election is the degree to which democrats will legitimately be able to run as a party that has effectively managed national security. as we sit here today, who knows what the next year's going to bring. we have the iran question, afghanistan out there. i think president obama, secretary clinton, they've been good stewards of american foreign policy, in a very unheroic time. this is not the time of big s.t.a.r.t. agreements and cold war superpower kind of events, but i think obama's been quite effective and i think national security, as we sit here today, christmas, is going to be a plus for him. >> but beyond just the politics, tom brokaw, the iraq war may be over, but the threat is not. i keep thinking to the tom ricks book "the gamble" in which he talks to ambassador crocker,

then-ambassador in iraq and he said the most notable thing for which iraq will be remembered has not yet accepted. and sectarian violence, the prospect of more violence, questions about u.s. responsibility going forward, those are -- those are real concerns. >> tom and i have been talking about that quite a lot. no one knows more about that part of the world than tom does. the fact is we're going to have to be on ready alert. just because we came home doesn't mean we don't have an investment and interests in that part of the world. iran is sitting out there, the whole relationship with israel. what's going on with the arab spring and what that produces in egypt. what happens in syria finally. how the saudis react to all of this. they've not been happy with the united states for the past year, because of the way that we dispatched mubarak, and they said, you know, that's how you treat your friends, are you having a change at the top there? that has to be an important part of the debate in the next year. but my guess is that we won't hear very much about it, because people don't find a lot of political capital talking about that. >> just to pick up on one point there, there's a question that's hung over the iraq enterprise

from day one and it's been this -- is iraq the way iraq is because saddam was the way saddam was? or was saddam the way saddam was because iraq was the way iraq was? is it a fractured, multisectarian country that could only be held together by an iron fist, first by saddam or residually by us? or is it not? we're going to get the answer to that question now. saddam's fist is gone, ours is gone, and the big question not just about iraq but all the arab springs is can they come together and write social contracts to live together in a way tilted forward, and then in a democratizing way. we're going to find out. and a lot of the stability of the world in the next, you know, decade, is going to depend on the answer to that. >> what are we in for is my question. and what are we up for as a country, kathleen? take this on. one of the interesting pieces in the debate is ron paul, who is an isolationist, and does not believe in much foreign policy, it doesn't seem, and certainly not military intervention. who said, look, we can't go around the world. these are his words.

we're just flat broke. we can't go on invading additional countries. whether it's, you know, our level of responsibility going forward in iraq, or the threat from iran, or even how we may have to manage all the consequences of the arab spring. as a country what are we prepared to do? >> well, ron paul will never be president of the united states. for starters -- >> there's a reason he's got a big following. >> well he gets a lot of applause for those lines. and i think part of that has to do with the fact that the american people are exhausted. and for the -- you know, if we were going to shock and awe iraq and be out in three months and here it is nine years later. nobody wants to see our young men and women going back and fighting any more wars. so clearly there is a -- there's a limit to what americans are willing to do. but what happens in the arab spring is the big question. because, you know, we like to -- we cheer the demonstrators, we cheer the democratic movement, we're all excited. but we're projecting our own values onto those countries. we have a tendency to do that. but democracy is more than voting. it's institutions. it's rule of law. >> i think it has to be said

that president obama has kept his promises, and has faithfully executed the foreign policy portfolio of the united states. and that's why it may not be a big issue in this election, but the larger question is a question to look back at iraq, and this has to be done as a nation, and look at a trillion dollars spent, 4,500 lives, and a residual expense by health care benefits. and i want to thank the troops on christmas day and the men and women in uniform who really gave in response to the call for war. but there's a larger question that's got to be litigated, and it's got to be retrospective for lessons learned. the second thing i'd say about foreign policy is, i think, the middle east is crucial. but in a changing world, david, with asia, with latin america, with rising economies, i think the united states also has to look at the world in very, very different way in the 21st century, because the economic factors and relationships that are going to be necessary for

competitive growth in the future are going to be far beyond simply a hyperfocused on the middle east. it's not to dismiss the middle east and its importance. but it's to say that many of the areas of the world are going to be critically important. and i think that we're going to see that played out after 2012. >> well, tom friedman, are we, as a country, going to have to react to chaos or are we going to react strategically to threats and opportunities posed by china? >> well, you know, to marc's point, it's a very good one. it's ironic, i think what, again, if you're writing a book today you'd say how interesting, barack obama has been much better at fulfilling george bush's national security policy than his own foreign policy. now why do i say that? i think he's really finished the war in iraq and he's prosecuted the war on terrorism, i think really smartly and effectively. but these other issues that marc has raised. how do we deal with china? how do we manage asia? how do we deal with rising

powers from india to brazil? those all depend on domestic strength. you could lecture china all you want but if you don't have a savings rate and they're sitting on $3 trillion of your money, you can lecture the middle east all you want, but if you're addicted to oil, see, all of these things now, that are -- we consider foreign policy, and how we manage the world, what they really depend on is totally different domestic politics. and we're not there yet as a country. certainly not obama's fault. >> what i'm saying, david, is that as domestic policy goes, as the strength of our country goes, so goes our standing in the world. and i think that that, i think, perhaps is something that should be a discussion, and should be an issue. >> we have a tent pole that holds up the world. we supply all these global economies and if this tent pole buckles, they won't grow up in a different america -- >> can i inject this if you look at failures of the president measured by our polling it goes to some of these bigger questions on the world stage, as well.

the top response, 24%, that he's been unable to improve economic conditions. and look at two and three, it's leadership, it's too much government spending. these are the kind i want to talk about health care and immigration in a couple of minutes but these are the kinds of things that get noticed in terms of how america is evaluating. >> just to comment on what both of these gentlemen were saying. you know, there is one republican candidate who's been saying these very things but for some reason he can't be heard. huntsman, the only mod rat in the group, is at the end of the debate panel and his lips are moving, and nobody's paying attention to what he's saying. but he has said over and over, he keeps coming back to this, particularly as it applies to china, look, we can't relate to these people in just specific ways, it has to be via values. and when america is strong at home, meaning take care of all of our issues here, then america is good. >> i think, david, really comes down to so much of the political debate has been retro, and it's not looking forward. we're playing off our previous successes and our previous strengths and we haven't caught

up to the idea that it's no longer the 20th century and the american century. we're out there having to compete every day now for our place in the global economic marketplace and the new considerations for national security i've been saying for the last couple of years, as we have put a military face on america, almost everywhere in the world, including the middle east, obviously in the subcontinent, especially, the chinese are making deals all over africa, all over central and south america and they're going in and making deals with the government, they're making deals with the tribes, they're extracting national resources, they're building roads. they have a whole different democrat plate that they're working off of than we are. >> one of 9 differences we make in our book, american competitionalism, it's not an honorary degree, it's not an entitlement like social security, it's your batting average. right now we're batting about $220. >> could i just add to this. our producer chris donovan found this terrific piece of tape that is so on point here i have to play it. it's about the 1990s argument and something that then-senator obama said back in november of

2007, if we have that we'll show it. >> i don't want to spend the next year or the next four years refighting the same fights that we had in the 1990s. >> bingo. tom brokaw. but isn't that the problem? is that we still are fighting those fights. >> well, that's the political year. i mean, part of the reason that we're not going to make a lot of progress this year is it's all about who gets the white house back. everyone knows that that's the great machine that moves the government and defines the culture in this country. and it's fairly discouraging, given all that is going on in the world, and the decisions that we have to make, that you can't operate on two different tracks. that you can have a big, vigorous political debate, but at the same time have something like what's happened this past week, with congressman ryan, and senator widen saying hey, here's something to look at when it comes to medicare. i found that the most heartening development of the week in many ways. it's not perfect, but it kick-starts that debate that is absolutely necessary to the future of this country in terms of entitlements and who gets

them and how much we pay for them. and it was lost in the cacophony of everything else. and that's the issue, i think. >> the issue, too, has to do with where the -- where the government started. where the year started. the horrible, tragic shooting of gabby giffords, the congresswoman from tucson, arizona, and president obama spoke in january at a memorial service about discourse, about politics, about the prospect of working together. and this is what he said. >> we should be civil because we want to live up to the example of public servants, like john roll and gab go giffords who knew first and foremost that we are all americans and that we can question each other's ideas without questioning each other's love of country, and that our task, working together, is to constantly widen the circle of our concern. so that we bequeath the american dream to future generations. >> and yet our politics

throughout the year were so broken, marc morial, and as we look ahead now, one of the2012, most bitterly divided issue for this administration, health care. the president prevailed, he got health care reform but in the middle of this election year, after all that acrimony, the supreme court is going to weigh in on his signature piece of legislation. >> they're going to be a big player this year, because they've taken, obviously, the affordable health care act and it's constitutionality. the constitutionality of the ability of states to regulate immigration, they've taken the texas reapportionment case, which certainly is going to affect the balance of power in congress. so one big player in 2012 will absolutely be the united states supreme court. but i think the american people, and people who watch the court don't think that the court is insulated from politics. and one cannot predict if the court, for some reason, were to strike down the affordable care act, there will be a reaction,

and there will be a counterreaction politically. it will have an effect on the outcome of the election. the same holds true for the immigration cases, and the reapportionment cases. so maybe the interesting sort of unplayed hand in this election will be what the supreme court does. >> looks like the supreme court probably will, 5-4 shoot down the individual mandate as unconstitutional. >> i can't believe this kathleen, you're putting yourself way out there. >> i'm putting myself way out there. i think that's what we're probably going to see and it will have a huge effect on the election. now whether the rest of it stands is another issue that has to be determined, the severability. >> that's from a policy point of view, what is at stake here, if the individual mandate were to go away, it really does affect broader access to health care. >> it's the engine of the whole plan. so you see what you have left. >> then you go back -- >> you do see the administration, however, beginning to trim its sails a little bit, setting off to the states this past week more decision making, that can be

made about how they went to set up the marketplace for insurers. they did the same thing about education, for example. the race to the top, states, you've got more choice going on here. you see them moving in that direction. >> it was so striking about this individual mandate, and the affordable health care act is for some reason it just doesn't exist. it's just another pile-on to the problems of the eroding middle class and the working class. no access to health care. loss of jobs and wages and income. loss of homes, and so there's an underlying issue here, and i've always said that those that oppose the president's affordable care act have a responsibility to offer an alternative proposal. this individual mandate was the republican plan of the early 1990s. i remember it because the first time i ran for office, it was the plan being promoted by those that were much more conservat e

conservative. so i don't think that you can disassociate this case from the signal it may potentially send. one way or another, to struggling, middle and working class americans who've seen their conditions really erode. >> the big problem with health care from the beginning has been it was far too come mention. that people really couldn't understand all the different provisions. the mandate -- >> have you red it? nobody can understand it. >> even people who have read it and health care experts are confused about how it plays out with the impact is on the best health care systems in the country. at the same time, there's been no one on the other side who has said, look, 17.5% of gdp is way too much to be spending on health care, here's our plan for getting it back down to 12%, 13%. there has been, as you say, there's been no plan to come along currentlyish- >> well, the republicans -- >> but is the president going to communicate this, tom, as his story? that he was able to bring greater financial security through delivering health care access to so many americans. no longer will preconditions be

an issue to force a denial of coverage? can he tell that story in the course of the campaign? >> i don't know if he can tell that story. i really, really worry about him. i'm sure he will tell a story and there will be lots of parts to it. but does he have a narrative about where we are today in the world? connecting it up in what we want to do, speaking frankly to people, and honestly, i go back to where we started this conversation. we're in a different time. the advantages america had coming out of world war ii, a world of walls, we stood astride the world, and we kind of got through a long period by creating a housing bubble, those days are over. you want the american dream now, david, it takes homework times two. i wish it wasn't that way. but it is. and that starts the conversation there. >> the important thing about an election, is an election is about a choice. so it's not just going to be president obama, it's going to be president obama and a vision, a set of ideas. >> i hope he gives us a big

choice. >> the second thing that we should never forget is that one of the things that stymied the president's ability, particularly since 2010, is that the control of the house shifted. where is the responsibility, and where is the record, of the majority of the house in terms of what they've been able to pass and what they've been able to put forward? we can't lead the congress in control of the congress out of this equation. the president is the president. the president is not the emperor. the president is not the overseer, and whatever -- and can rule by decree. so i think it's important in this political conversation, you can't look at the president and what he's been able to do or not do. without assigning some responsibility to absolute -- >> so where is the president say i'm here to change the polls, not read the polls? >> right, and i would also add to that, his narrative thus far has been i've inherited a terrible mess, i've done the best i could but they've blocked me at every step.

to a lot of independent and moderates that sounds good like things are bad, but i could have done a much worse job. also, you know, i think this narrative of the class warfare, you know, the rich are getting richer and the poor are getting poorer it pits america against each other and it is frankly un-american. i don't think it's -- >> the problem with it, kath wleen, is it's true. if the facts are the facts, i mean, separate what you call it. what slogans you use. the fact of the matter is, we've had a growing economic divide, and the top 10% have really seen their fortunes increase dramatically in the last 125 of 15 years -- >> but you have to appeal to people's better angels. the same gallup report i keep quoting said 82% of americans care most, think that the prevailing message needs to be hope and opportunity. they don't want the negative. they want the positive. >> i think most americans want to get into that top 10%, by the way. >> of course. >> that's why it doesn't play. the other thing is, i just offer two history lessons for this christmas. one, i've been reading a book about the christmas of 1941 which is right after pearl harbor and what was going on at

the white house, winston churchill had come here. you talk about problems, you talk about a challenge, the world was at war. hitler had eaten up most of europe at that point. the japanese were amok in the pacific. we didn't have a military that was prepared, really, for the consequences of that. then i've been reading about the campaign of 1948. harry truman, who had inherited the presidency from fdr, and a lot of people were against him, and the vitriol in that campaign against the incumbent president who had not earned his place, they all thought, we had henry wallace and strom thurmond threatening to run or planning to run as third party candidates, we got through it. those were much more difficult days in many ways than what we're facing now. because, people came with big, bold ideas about how they were going to deal with it. >> it was a much less competitive world. and that's the thing. we've -- we -- it's true, tom, but we so dominated the world then in a way we don't anymore. >> no, i agree with that, tom. i'm just talking about the culture of politics.

>> i appreciate that. >> and -- but the question is then, what with that reality that we don't dominate the world the way we used to in the united states, what changes politics? what gives it a wake-up call to get on to the right track? >> well, i think big, bold ideas. and i think not being afraid to say to the public, to the american public, this is going to be hard. it's not going to be easy. and -- and just, by the way, here's what we're facing. you all know that. and it's not yesterday in this country. it's tomorrow. it's not this morning, as ronald reagan's time, it's tomorrow morning that we have to worpry about. >> surprise us. wake up one morning, pick up the paper and say wow, barack obama just took such a political risk. if he took that risk i'd like to take a risk, too, and get behind him. >> they're doing it out in the country and there are smaller ways. you know, they're changing their business plans, and they're going at education in a different fashion. and they're willing to upset convention in a lot of different parts of the american economy in

which parochial way and they feel walled off from what's going on in the national politics. >> the thing that nobody will say, at least if they're running for office, is that the hard lesson here is that our revenue problems have to be solved by raising taxes, probably on everyone. and our spending problems have to be solved by cutting. and nobody will say what is absolutely true. we all have to do, you know, it's going to be painful for everybody. >> we're going to have to take another quick break. we'll be right back in our remaining moments, including some christmas reflections from the former archbishop of washington, cardinal theodore mccarrick after this. the world's airports land a plane every second. but over the next 20 years, air traffic is expected to double. the systems that track, manage and connect these flights weren't built to handle all that data. ibm is working with boeing on a next generation system to help integrate global air traffic more efficiently

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and we are back. in our remaining moments here this christmas morning, we want to bring you an excerpt from our press pass conversation, which you can find on our website this week, with a man very familiar to our viewers over the years, the former aurnlg bishop of

washington, cardinal theodore mccarrick. families are gathering on -- for christmas, for the holidays, and it's such a great placing for everyone to be together. as we think about the country, everywhere in every community across the country, people are really hurting. >> and there's no question about it. you travel any part of the country, and you see so many families that are broken, families that have lost their -- their breadwinner. families that are becoming more poor than they were before. we always had that great american dream that your children were going to do better than you would. there was always a progression upward. now a lot of our families who say, no, that i'm worried about my daughters and sons and what's going to happen to them, because they are not going to have the opportunities that i've had. that, of course, is very depressing for people, and in a world like that, you don't need depressing things. >> as all of us work at our

relationship with god, i always wonder how difficult it is for people who are going through real trials in their lives, to rely upon that relationship. if it's -- maybe it's automatically a source of strength, but aren't there times when working your faith becomes a real challenge? >> absolutely, for everybody. for everybody. for clergymen, as well as for lay people. but i think christmas is maybe the answer to all that. christmas is a season of hope, a season of expectation, a season of love. and there are people who will be celebrating christmas in less than the perfect circumstances. they won't have enough to eat. there will be unemployment in the family. there will be the heat in the house may not be as good as it should be. there won't be a turkey, or a ham or whatever on the table. but that's why christmas comes. i think christmas comes to remind us that there is a god,

and that this is a god who loves us. i think the -- if you touch the whole basis of the abrahamic family, the family of abraham, christians, muslims, jewish people, and in that -- there is a god who loves, a god who is our muslim brothers and sisters, a god who is loving and compassionate. loving and compassionate. and merciful. and the -- the lesson of the world -- the hebrew scriptures when we pull the old testament is equal, this is a god who made us, who loves us, and who promises us that we'll never leave us. and of course, we christians will celebrate the birth of christ this day. we believe that that is the answer to god's promises that he will always be with us. he sent us his son. >> and it is in that spirit that we wish you and your family a very merry christmas and a joyous and peaceful new year. we'll be back next week. new year's day, live, from des moines, iowa, just two days

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e powerful. that's why we're here. when not used in the right way, they can divide a nation. but when used wisely, they can bring us together in ways that make us stronger. words can connect us all... the more you know.

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