PBS NewsHour; January 11, 2013 6:00pm-7:00pm PST

AND DAVID BROOKS ANALYZE THE WEEK'S NEWS. THAT'S ALL AHEAD ON TONIGHT'S NEWSHOUR.

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>> Woodruff: THE FUTURE U.S. MILITARY ROLE IN AFGHANISTAN WAS FRONT AND CENTER TODAY AS PRESIDENT OBAMA MET WITH AFGHAN LEADER HAMID KARZAI. THEY REPORTED PROGRESS IN THEIR TALKS, AND SAID THE PACE OF THE SECURITY TRANSITION WILL BE EXPEDITED. AT THEIR FIRST FACE-TO-FACE MEETING SINCE MAY, THE LEADERS ANNOUNCED THEY'RE ACCELERATING THE HANDOFF FROM U.S. AND COALITION FORCES TO AFGHAN TROOPS.

>> LET ME SAY IT AS PLAINLY AS I CAN-- STARTING THIS SPRING, OUR TROOPS WILL HAVE A DIFFERENT MISSION: TRAINING, ADVISING, ASSISTING AFGHAN FORCES. IT WILL BE AN HISTORIC MOMENT AND ANOTHER STEP TOWARD FULL AFGHAN SOVEREIGNTY.

>> IN SPRING THIS YEAR, THE AFGHAN FORCES WILL BE FULLY RESPONSIBLE FOR PROVIDING SECURITY TO THE AFGHAN PEOPLE. AND THAT THE INTERNATIONAL FORCES, THE AMERICAN FORCES, WILL BE NO LONGER PRESENT IN AFGHAN VILLAGES.

>> Woodruff: AFGHANISTAN PRESIDENT HAMID KARZAI HAS SHARPLY COMPLAINED THAT FIGHTING IN AFGHAN VILLAGES IS CAUSING TOO MANY CIVILIAN CASUALTIES. AND THERE'VE BEEN OTHER STRAINS FROM KORAN BURNINGS BY AMERICAN SOLDIERS TO DEADLY INSIDER ATTACKS BY AFGHAN SOLDIERS. FOR NOW, THE U.S. STILL HAS 66,000 TROOPS IN AFGHANISTAN, BUT IT'S MOVING TOWARD WITHDRAWING ALL COMBAT FORCES BY THE END OF 2014. GENERAL JOHN ALLEN, THE COMMANDER OF U.S. AND NATO FORCES IN AFGHANISTAN, HAS LAID OUT A RANGE OF TROOP LEVEL OPTIONS TO PRESIDENT OBAMA, FROM AS HIGH AS 20,000 TO AS LOW AS 6,000, TO STAY ON TO TRAIN AFGHAN SOLDIERS AND FIGHT AL QAEDA. WHITE HOUSE OFFICIALS ARE SAID TO FAVOR FEWER TROOPS. THIS WEEK, DEPUTY NATIONAL SECURITY ADVISER BEN RHODES EVEN SUGGESTED IT'S POSSIBLE THAT NO AMERICANS WILL STAY. THE PRESIDENT DECLINED TO NAME A NUMBER TODAY.

>> I'M STILL GETTING RECOMMENDATIONS FROM THE PENTAGON AND OUR COMMANDERS ON THE GROUND IN TERMS OF WHAT THAT WOULD LOOK LIKE. AND WHEN WE HAVE MORE INFORMATION ABOUT THAT, I WILL BE DESCRIBING THAT TO THE AMERICAN PEOPLE.

>> Woodruff: IN NOVEMBER, THE U.S. AND AFGHANISTAN STARTED NEGOTIATIONS ON A SO-CALLED "BILATERAL SECURITY AGREEMENT" TO GOVERN ANY FUTURE AMERICAN MILITARY ROLE. U.S. OFFICIALS HAVE INSISTED THAT ANY TROOPS WHO DO STAY MUST HAVE LEGAL PROTECTION, AS THE PRESIDENT SAID AGAIN TODAY.

>> WE HAVE ARRANGEMENTS LIKE THIS WITH COUNTRIES ALL AROUND THE WORLD, AND NOWHERE DO WE HAVE ANY KIND OF SECURITY AGREEMENT WITH A COUNTRY WITHOUT IMMUNITY FOR OUR TROOPS.

>> Woodruff: IN TURN, KARZAI SAID NOW THAT THE TRANSITION IS BEING EXPEDITED, THE IMMUNITY QUESTION MAY NO LONGER BE A STICKING POINT.

>> I CAN GO TO THE AFGHAN PEOPLE AND ARGUE FOR IMMUNITY FOR U.S. TROOPS IN AFGHANISTAN IN A WAY THAT AFGHAN SOVEREIGNTY WILL NOT BE COMPROMISED, IN A WAY THAT AFGHAN LAW WILL NOT BE COMPROMISED.

>> Woodruff: BACK IN KABUL, THE QUESTIONS OF WHETHER U.S. TROOPS REMAIN, AND HOW MANY AND UNDER WHAT CONDITIONS, HAVE DIVIDED AFGHANS, AS EVIDENT THIS WEEK.

>> ( translated ): IF ALL U.S. TROOPS LEAVE AFGHANISTAN AFTER 2014, THE CIVIL WAR WILL START ONCE AGAIN, BECAUSE WE HAVE EXPERIENCED CIVIL WAR IN THE PAST. IT WILL HAPPEN AGAIN IF ALL TROOPS GO HOME.

>> ( translated ): I THINK IT IS NECESSARY FOR U.S. TROOPS TO WITHDRAW FROM AFGHANISTAN BECAUSE OUR NATIONAL ARMY IS CAPABLE ENOUGH TO DEFEND AND SAVE THE COUNTRY IN ANY SITUATION.

>> Woodruff: ACCORDING TO NATO, THE AFGHAN NATIONAL ARMY FORCE NOW STANDS AT 187,000. YESTERDAY, DEFENSE SECRETARY LEON PANETTA VOICED CONFIDENCE IN THOSE FORCES AS HE MET WITH PRESIDENT KARZAI AT THE PENTAGON. THE AFGHAN GOVERNMENT HAS ALSO BEEN PURSUING PEACE TALKS WITH THE TALIBAN. AS PART OF THAT PROCESS, THE KARZAI GOVERNMENT HAS URGED PAKISTAN TO RELEASE MORE TALIBAN FIGHTERS. FOUR WERE FREED LAST WEEK AFTER MORE THAN TWO DOZEN WERE RELEASED IN THE PAST FEW MONTHS. WHATEVER COMES OF THE PEACE EFFORTS, PRESIDENT KARZAI SAID AGAIN TODAY, HE PLANS TO STEP DOWN NEXT YEAR.

>> CERTAINLY, I WILL BE A RETIRED PRESIDENT AND VERY HAPPILY IN RETIREMENT.

>> Woodruff: KARZAI HAS BEEN DOGGED BY CHARGES OF FRAUD SINCE HIS RE-ELECTION, PART OF LARGER CONCERNS ABOUT CORRUPTION IN HIS GOVERNMENT. HE ACKNOWLEDGED THE CONCERNS TODAY, AND SAID HE HOPES FOR A PROPER ELECTION TO NAME HIS SUCCESSOR.

>> Brown: WE PICK UP ON TODAY'S MEETING WITH TWO MEN WITH EXTENSIVE EXPERIENCE IN MANAGING U.S.-AFGHAN RELATIONS. SAID JAWAD WAS AFGHANISTAN'S AMBASSADOR TO WASHINGTON FROM 2003 TO 2010. BEFORE THAT, HE WAS PRESIDENT KARZAI'S CHIEF OF STAFF. AND PETER TOMSEN WAS A CAREER DIPLOMAT WHO SERVED AS SPECIAL ENVOY ON AFGHANISTAN DURING THE GEORGE H.W. BUSH ADMINISTRATION. HE'S THE AUTHOR OF "THE WARS OF AFGHANISTAN." PETER TOMSEN, LET'S START WITH YOU. WHAT JUMPS OUT AT YOU. HELP US DECODE WHAT WAS IN THAT MEETING, WHAT WAS MOST POURNT.

>> IS THINK WHAT JUMPED OUT AT ME MOSTLY WAS THE ACCELERATION IN THE TRANSITION. WHICH I THINK IS GOOD. THAT AMERICAN TROOPS ARE GOING TO BE LEAVING AT A FASTER CLIP. AND ALSO ON THE FUNCTION SIDE, SO TO SPEAK THAT THE ROLE OF AMERICAN TROOPS IN COMBAT AS WAS MENTIONED IN THE CLIP IS GOING TO BE PHASED OUT. ALSO, WHAT PRESIDENT KARZAI SAID ON ELECTIONS I THOUGHT WAS EXCELLENT BECAUSE THERE HAS BEEN A LOT OF CONCERN THAT THE ELECTION SCHEDULE FOR 2014 MIGHT END UP LIKE THE ELECTIONS IN 200 THE WHEN THERE WAS A GOOD DEAL OF FRAUD. AS YOU MIGHT RECALL. THEN I WAS VERY PLEASED TO SEE THE COMMENTS ON WOMEN, THE EMPHASIS ON GENDER EQUALITY. AND ALSO IMMUNITY FOR OUR TROOPS. PRESIDENT KARZAI, I THOUGHT, BASICALLY ACCEPTED THAT AXIOM WHICH WE FOLLOWED THROUGHOUT THE WORLD.

>> Brown: LET ME ASK SAID JAWAD WHAT DID PRESIDENT KARZAI COME MERE MOST WANTING. WHAT IS MOST IMPORTANT TO HIM IN THE GOVERNMENT RIGHT NOW?

>> A COUPLE OF THINGS. FIRST AND FOREMOST WAS THE EQUIPMENT, THE NATIONAL AFGHAN SECURITY FORCES ARE SEIZING. PRESIDENT KARZAI IS ASKING FOR LONG-RANGE ARTILLERY, TRANSPORT CAPABILITY FOR AT AFGHAN SECURITY FORCES.

>> Brown: HE WANTS MORE EQUIPMENT.

>> HE WANTED ACTUALLY THE AMERICANS TO GET OUT OF WHAT HE CALLED AFGHAN VILLAGES AND ALSO HE WANTED TO HAVE A CLARIFICATION ON THE ISSUE OF RECONCILIATION. THERE IS A DIFFERENT CHANNEL OF RECONCILIATION TAKING PLACE. AND DURING THOSE MEETINGS BOTH AFGHANISTAN AND UNITED STATES AGREED TO SUPPORT MOVER A U.S. LEAD AIR FORCE WHICH IS BASED OUT OF DOJAS QATAR.

>> Brown: DOESN'T MUCH OF THIS DEPEND ON THE NOTION THAT THERE HAS BEEN GREAT SUCCESS BY THE U.S. FORCES AND AFGHAN FORCE AND NOW AFGHAN FORCES CAN KEEP THE BALL GOING SO TO SPEAK AGAINST THE TALIBAN? IS THAT THE CASE?

>> WELL, WHEN YOU TRAVEL TO AFGHANISTAN YOU DO SEE THE AFGHAN SECURITY FORCES REQUIRE A LOT MORE CAPABILITIES BUT ABILITY TO GATHER INTELLIGENCE, AIR TRANSPORT, HAVING CANONS AND TYPE, STILL TO RELY ON NATO FORCES TO PROVIDE THAT THAT IS ASK PRESIDENT KARZAI IS ASKING FOR THESE THINGS SO THE AFGHAN SECURITY FORCES CAN OPERATE MORE INDEPENDENTLY.

>> Brown: WHAT DO YOU THINK OF THE ASSESSMENT OF THE SECURITY FORCES.

>> I WOULD AGREE, THERE IS A BIG QUESTION OF FISCAL RESPONSIBILITY. THINGS ARE MOVING IN THE RIGHT DIRECTION. THE COMBAT FORCES HAVE TAKEN OVER THE COMBAT ROLE AND NOW 75% OF THE COUNTRY, BUT IT WILL GO UP TO 90% SOON AS THE PRESIDENT MENTIONED. BUT MISSING IN THE DISCUSSIONS, AND I DON'T THINK THAT THIS WAS PLANNED TO BE ANNOUNCED DURING THIS VISIT IS THE QUESTION OF HOW MUCH MONEY WILL BE REQUIRED FOR THE AFGHAN NATIONAL SECURITY FORCES WHICH HAVE REACHED 344,000. AND HIRE BEING 174,000, AND CONGRESS MR. HAVE A SAY.

>> Brown: THE QUESTION OF THE SCALE AND SPEED OF THE DRAWDOWN ESTIMATE TO COME AS THE PRESIDENT SAID, BUT MUCH OF THIS IS ABOUT WHAT HAPPENED AFTERWARDS, AFTER 2014, THAT SO-CALLED SECURITY AGREEMENT OF SOME KIND.

>> YES, ABSOLUTELY. TWO KEY ISSUES FOR THE FUTURE OF AFGHANISTAN IS THE POLITICAL CERTAINTY. FOR AN AFGHAN, INSECURITY IS TO THE A PROBLEM, IT'S UNCERTAINTY. THE FACT WE DON'T KNOW WHAT WE ARE TRANSITIONING TOO. WHAT IS NEXT FOR AFGHAN. PART OF THAT HAS TO BE FORM NATURE-- FORMULATED BY THE AFGHAN POLITICAL LEADERSHIP. THEY CAN HELP TO A CERTAIN DEGREE BUT WE STILL DO NEED TO HEAR VERY CLEARLY WHAT IS IN FOR AFGHANISTAN AFTER 2014, AS FAR AS WHAT FROM THE NATIONAL PARTNER BUT MOST IMPORTANTLY HOW AFGHANISTAN ITSELF SEES ITSELF IN A CHANGING REGION.

>> WHAT ABOUT THIS OF HAMID KARZAI SAYING HE WILL BE RETIRED PRESIDENT SOON ENOUGH. IS THAT A CERTAINTY AT THIS POINT. AND THEN WHAT DOES THAT MEAN FOR AFGHAN POLITICS?

>> THAT IS A CHALLENGE. I BELIEVE THAT PRESIDENT KARZAI WILL STEP DOWN AND HE IS NOT GOING TO BE RUNNING.

>> THEREFORE I DIDN'T EXPECT HE WILL BE ENDORSING INDIVIDUAL GROUPS TOO EARLY THAT ENHANCES THIS ENVIRONMENT OF UNCERTAINTY IN AFGHANISTAN WHERE WE DO NEED ACTUALLY A CLEAR MOVEMENT. WE DON'T HAVE POLITICAL PARTY NOTICE AFGHANISTAN SO THEREFORE IT'S IMPORTANT TO KNOW WHO ARE SOME OF THE FRONT-RUNNERS BUT PRESIDENT KARZAI MAY NOT LIKE TO SEE AN INDIVIDUAL EMERGING BECAUSE IT WILL MAKE HIM LESS RELEVANT.

>> OF COURSE WASHINGTON'S RELATIONS WITH PRESIDENT KARZAI HAVE BEEN BUMPY MANY TIMES ALONG THE WAY.

>> YES.

>> SO IS THERE A CLEAR SENSE, A BELIEF THAT HE WILL STEP DOWN IN SOME SENSE OF WHAT COMES NEXT.

>> I THINK I WOULD AGREE AGAIN WITH THE AMBASSADOR THAT EVEN THOUGH HE MENTIONED THIS, THE JURY IS STILL OUT AS TO WHAT WILL HAPPEN. AFGHANISTAN IS AN UNPREDICTABLE PLACE AS I FOUND OUT AND MANY WOULD AGREE. HOWEVER IT WOULD REALLY HELP DEMOCRATIC INSTITUTION BUILDING IN AFGHANISTAN AND THE DEMOCRATIC PROCESS IF HE DID FOLLOW THROUGH WITH THIS COMMITMENT ET CETERA'S JUST MADE IN FRONT OF THE PRESIDENT OF THE UNITED STATES AN AMERICAN PUBLIC HERE IN THE UNITED STATES. HE SAID IT BEFORE IN AFGHANISTAN AND ACTUALLY LEFT OFFICE AND LET THE DEMOCRATIC PROCESS GO FORWARD AND ELECTIONS GO FORWARD AND THE AFGHAN PEOPLE FINALLY SINCE, WHAT, THE 70s ARE ABLE TO CHOOSE THEIR OWN LEADER.

>> Brown: YOU BROUGHT UP THE QUESTION OF THIS IMMUNITY EARLIER IN THE DISCUSSION. THIS WOULD BE AFTER 2014 WITH WHAT U.S. PERSONNEL, MILITARY PERSONNEL ARE LEFT. DID YOU SENSE THAT THAT WAS RESOLVED SOMEHOW OR AT LEAST JUST AIRED.

>> I THINK IT WAS MORE THAN AIRED. I THINK THAT PRESIDENT KARZAI ACTUALLY SAID THAT THIS CAN BE HANDLED AND WE WILL MOVE FORWARD AND INN DISCUSSING THIS AND TAKING CARE OF IT. I CAN'T IMAGINE THAT HE WOULD BACKTRACK ON THAT I THINK I WOULD DEFER TOTAL WAS DOOR ON THIS THAT HIS OVERALL FOCUS ON PROTECTING AFGHANISTAN SOVEREIGNTY, AND IT DOESN'T EXTEND TO THIS ISSUE TO THAT EXTEND.

>> Brown: WAZ DO YOU THINK? IS THIS A BIG ISSUE THERE.

>> ACTUALLY THE STRATEGIC BIP THAT WE SIGNED WITH THE UNITED STATES MOVED QUICKLY DESPITE THE COMPLICATION OUR PARLIAMENT HAS. THE GRAND COUNCIL APPROVED THAT SMOOTHLY, EASILY. AS FAR AS AFGHAN PEOPLE ARE CONCERNED I DON'T THINK THIS WILL BE A BIG ISSUE. BUT OF COURSE IT WILL BE USED AS A BARGAINING TOOL BY BOTH SIDES BUT AT THE END OF THE DAY PRESIDENT KARZAI UNDERSTANDS CLEARLY THAT U.S. WILL INSIST AND REQUIRE THAT IMMUNITY WILL BE PART OF THE PACKAGE.

>> Brown: ONE OTHER ISSUE BRIEFLY IS THE TALKS WITH THE TALIBAN. THE AFGHAN TALKS WITH THE TALIBAN. WHERE DOES THAT STAND FROM PRESIDENT KARZAI AND THE AFGHAN GOVERNMENT'S STANCE AT THIS POINT?

>> EFFORTS LEAD BY THE UNITED STATES WERE CENTERED AROUND OPENING, PRESIDENT KARZAI ENDORSED THAT WHICH IS A POSITIVE DEVELOPMENT.

>> A NEW MOVE.

>> IT'S A NEW MOVE AND WE MOVE US TOWARD THE DIRECTION IN BEING ON THE SAME PAGE AMONG OURSELVES AS AFGHANS, AMERICANS AND PAKISTANIES. BEFORE WE HAVE TO BE ON THE SAME PAGE AND IT WILL TAKE US ONE STEP CLOSER TO THAT OBJECTIVE.

>> I THINK IT'S GOING TO BE A DIFFICULT PROCESS. I'M GLAD WE ARE ENGAGED IN NEGOTIATIONS WITH THE TALIBAN AND THE AFGHAN GOVERNMENT'S NEGOTIATION WITH ITS TALIBAN ARE MOST IMPORTANT. WE SHOULD FACILITATE IT BUT NOT JUMP IN AND TRY TO RESOLVE THE PROBLEM OS OURSELVES. HOWEVER I THINK THAT AFGHAN JOURNALIST QUESTION ON GEND ARE EQUALITY DURING THE PRESS CONFERENCE SHOWED MAYBE AN UNMOVABLE OBSTACLE WHICH IS WHAT THE TALIBAN DO TOO WOMEN, ON THE ONE HAND AND WHAT THE AFGHAN CONSTITUTION SAYS TO PROTECT WOMEN, ON THE OTHER HAND YOU HAVE HEARD OF THIS INCIDENT WITHIOUSEV ZAI IN PAKISTAN WHERE THEY TRIED TO ASSASSINATE HER. IN AFGHANISTAN IT IS WORKS THE THREE PROXIES OF THE MILITARY, THE HAQQANI,-- THEY CROSS THE BORDER TO TAKE ON THE AFGHAN GOVERNMENT. THEY ARE ALSO VERY MUCH INVOLVED IN TORCHING GIRLS SCHOOLS, POISONING THE LUNCHES OF GIRLS SCHOOLS AND KILLING SCHOOL GIRL ITS LIKE MALANI. SO IT IS GOING TO BE HARD.

>> MANY, MANY COMPLI CATIONS, TETER TOMSEN AND SAID JAWAD, THANK YOU VERY MUCH.

>> Woodruff: STILL TO COME ON THE NEWSHOUR: THE FAA's DECISION TO EXAMINE THE BOEING 787 DREAMLINER; THE BUZZ ON CUTTING EDGE TECHNOLOGY; AND SHIELDS AND BROOKS. BUT FIRST, THE OTHER NEWS OF THE DAY. HERE'S HARI SREENIVASAN.

>> Sreenivasan: THE DEATH TOLL IN A DOUBLE BOMBING ON A BILLIARDS HALL IN PAKISTAN ROSE TO 86 TODAY. SHIITES WERE THE TARGET, AND TODAY SOME PEOPLE REFUSED TO BURY THEIR DEAD IN PROTEST, DEMANDING THE GOVERNMENT PROTECT THEM BETTER. THE TWIN BOMBINGS WERE THE WORST IN A SERIES OF ATTACKS YESTERDAY THAT KILLED A TOTAL OF 120 PEOPLE. IN SYRIA, REBEL FIGHTERS CAPTURED CONTROL OF A MAJOR AIR BASE IN THE NORTHWESTERN PART OF THE COUNTRY. THEY SEIZED HELICOPTERS AND OTHER WEAPONS AT THE TAFTANAZ BASE IN IDLIB PROVINCE. IT'S THE LARGEST MILITARY SITE THEY'VE TAKEN SO FAR. MEANWHILE, IN GENEVA, U.N. ENVOY LAKHDAR BRAHIMI MET WITH U.S. AND RUSSIAN DIPLOMATS IN A SEARCH FOR A POLITICAL SOLUTION IN SYRIA. HE SAID LATER THAT PROSPECTS APPEAR GRIM. FRANCE INTERVENED IN MALI TODAY TO STEM AN OFFENSIVE BY ISLAMIC REBELS LINKED TO AL QAEDA. WITHIN HOURS OF ARRIVING, THE FRENCH LAUNCHED AIR STRIKES AND HELPED GOVERNMENT FORCES RETAKE THE TOWN OF KONNA IN THE CENTER OF THE WEST AFRICAN NATION. REBELS PUSHING DOWN FROM THE NORTH HAD SEIZED IT THIS WEEK. IN PARIS, FRENCH PRESIDENT FRANCOIS HOLLANDE SAID HIS GOVERNMENT ANSWERED AN URGENT APPEAL FROM THE PRESIDENT OF ITS FORMER COLONY.

>> MALI IS BEING CONFRONTED WITH AN AGGRESSION BY TERRORIST ELEMENTS COMING FROM THE NORTH WHOSE BRUTALITY AND FANATICISM THE ENTIRE WORLD IS AWARE OF. AS A CONSEQUENCE A FRENCHED ARM FORCES BROUGHT THEIR SUPPORT THIS AFTERNOON TO MALI UNITS TO FIGHT AGAINST THESE TERRORIST ELEMENTS. THIS OPERATION WILL LAST AS LONG AS NECESSARY.

>> Sreenivasan: LATER, THE MALIAN PRESIDENT DECLARED A NATIONAL STATE OF EMERGENCY. HIS DEFENSE MINISTRY SAID NIGERIA AND SENEGAL ARE PROVIDING MILITARY AID AS WELL. THE SUSPECT IN THE COLORADO THEATER SHOOTINGS WILL STAND TRIAL, BUT HE WON'T HAVE TO ENTER A PLEA UNTIL MARCH. OVERNIGHT, A JUDGE RULED THERE IS SUFFICIENT EVIDENCE TO PROSECUTE JAMES HOLMES. HE ALLEGEDLY KILLED 12 PEOPLE AND INJURED 58 OTHERS LAST JULY. TODAY, THE JUDGE GRANTED A DEFENSE MOTION TO DELAY HOLMES' ARRAIGNMENT OVER THE OBJECTIONS OF THE PROSECUTION AND VICTIMS' FAMILIES. DEFENSE LAWYERS HAVE SAID HE IS MENTALLY ILL. REPRESENTATIVES OF THE VIDEO GAME INDUSTRY HAD THEIR TURN TODAY MEETING WITH VICE PRESIDENT BIDEN ON WAYS TO CURB GUN VIOLENCE. MAKERS OF SO-CALLED "FIRST PERSON SHOOTER" GAMES, INCLUDING "CALL OF DUTY" AND "GRAND THEFT AUTO," TOOK PART. THERE WAS NO INDICATION OF WHAT THE VICE PRESIDENT ASKED OF THE INDUSTRY. BUT HE SAID YESTERDAY HE PLANS TO GIVE RECOMMENDATIONS TO PRESIDENT OBAMA BY TUESDAY. INFLUENZA HAS OFFICIALLY REACHED EPIDEMIC PROPORTIONS IN THE U.S. THE CENTERS FOR DISEASE CONTROL CONFIRMED TODAY THAT MORE THAN 7% OF DEATHS IN THE COUNTRY WERE DUE TO FLU AND PNEUMONIA LAST WEEK. THAT'S JUST ABOVE THE THRESHOLD FOR AN EPIDEMIC. NINE OF TEN REGIONS HAD "ELEVATED" FLU ACTIVITY, CONFIRMING THE SEASONAL OUTBREAK HAS SPREAD EARLIER THAN USUAL. CALIFORNIA SHIVERED TODAY AS SOME OF THE COLDEST WEATHER IN YEARS HIT MUCH OF THE STATE. EARLY MORNING TEMPERATURES DIPPED INTO THE 20s, AND SOME CITRUS GROWERS SHROUDED PLANTS IN PROTECTIVE COVERS TO SAVE THEM FROM FROST. OTHERS USED FANS TO CIRCULATE THE AIR. THE SYSTEM ALSO DUMPED SNOW ON THURSDAY THAT CLOSED PART OF INTERSTATE FIVE FOR 17 HOURS. THE COLD WAS EXPECTED TO LAST THROUGH THE WEEKEND. WEST VIRGINIA SENATOR JAY ROCKEFELLER WILL NOT SEEK A SIXTH TERM IN 2014. THE VETERAN DEMOCRAT ANNOUNCED THE DECISION TODAY. HE SAID HE BELIEVES HE COULD HAVE BEEN RE-ELECTED, EVEN THOUGH THE STATE IS TRENDING MORE REPUBLICAN. BUT AT AGE 75, HE SAID HE WANTS MORE TIME WITH HIS FAMILY.

>> IT IS NOT A POLITICAL DECISION. AND IT HAS NOT BEEN EASY. IT'S SIMPLY THIS. AS I APPROACH 50 YEARS OF NONSTOP PUBLIC SERVICE IN WEST VIRGINIA, I KNOW DEEP WITHIN ME THAT THE END OF THIS TERM IN 2014 IS THE RIGHT TIME FOR ME TO RECALIBRATE.

>> Sreenivasan: ROCKEFELLER HAS BEEN A STRONG SUPPORTER OF LABOR, AND CHAMPIONED HEALTH AND SAFETY ISSUE FOR WEST VIRGINIA'S COAL MINERS. HIS RETIREMENT COULD COMPLICATE DEMOCRATS' EFFORTS TO KEEP CONTROL OF THE SENATE IN THE 2014 ELECTIONS. WALL STREET KEPT ITS WINNING STREAK GOING TODAY, BUT NOT BY MUCH. THE DOW JONES INDUSTRIAL AVERAGE GAINED 17 POINTS TO CLOSE AT 13,488. THE NASDAQ ROSE NEARLY FOUR POINTS TO CLOSE AT 3,125. FOR THE WEEK, BOTH THE DOW AND THE NASDAQ GAINED A FRACTION OF 1%. THOSE ARE SOME OF THE DAY'S MAJOR STORIES. NOW, BACK TO JUDY.

>> Woodruff: THIS WEEK HAS BEEN A BUMPY RIDE, TO SAY THE LEAST, FOR AVIATION GIANT BOEING AND ITS NEW JET; A WEEK CAPPED BY THE GOVERNMENT'S DECISION TO LOOK CLOSELY AT THE PLANE'S OPERATING SYSTEMS AGAIN. MARGARET WARNER HAS THE STORY.

>> Warner: BOEING BEGAN DELIVERING ITS SOPHISTICATED NEW 787 DREAMLINER JET TO MUCH FANFARE 14 MONTHS AGO AFTER YEARS OF PRODUCTION DELAYS. NOW, A SERIES OF RECENT INCIDENTS HAS RAISED CONCERNS ABOUT THE 50 PLANES IN THE AIR, SO MUCH SO THAT, TODAY, THE HEAD OF THE FEDERAL AVIATION ADMINISTRATION, MICHAEL HUERTA, ANNOUNCED A COMPREHENSIVE REVIEW.

>> THE FOCUS IS ON THE DESIGN, PRODUCTION, AND MANUFACTURE OF THE AIRPLANE. WE'RE FOCUSING ON THE ELECTRICAL SYSTEMS AS THE HIGHEST LEVEL OF PRIORITY. OUR FOCUS IS ON WHAT THE DATA TELLS US AND WHAT WE IDENTIFY AS POTENTIAL ISSUES THERE. AND BASED ON WHAT WE LEARN, WE WILL TAKE WHATEVER APPROPRIATE ACTION IS NECESSARY.

>> Warner: LAST MONTH, A UNITED AIRLINES 787 FROM HOUSTON TO NEWARK WAS DIVERTED TO NEW ORLEANS AFTER ONE OF ITS SIX ELECTRICAL GENERATORS FAILED MID-FLIGHT. ON MONDAY, A BATTERY FIRE IGNITED IN AN EMPTY JAPAN AIRLINES DREAMLINER AT BOSTON'S LOGAN INTERNATIONAL AIRPORT. SUSPICION FELL ON ITS HIGH- CAPACITY RECHARGEABLE LITHIUM ION BATTERIES CONTAINING FLAMMABLE LIQUID. AND THE VERY NEXT DAY...

>> THERE'S A LARGE AMOUNT OF FUEL SPILLING FROM THE BACK OF YOUR AIRCRAFT.

>> Warner: ...ANOTHER JAPAN AIRLINES 787 AT LOGAN SUFFERED A FUEL LEAK. JAPAN'S ALL NIPPON AIRWAYS ALSO HAS REPORTED PROBLEMS WITH SEVERAL OF ITS DREAMLINER" JETS, FROM AN OIL LEAK AND BRAKE ISSUES TO A CRACKED COCKPIT WINDOW. NO ONE'S BEEN INJURED IN THESE INCIDENTS. RAY CONNER, PRESIDENT AND C.E.O. OF BOEING'S COMMERCIAL AIRCRAFT DIVISION, VOICED CONFIDENCE IN THE PLANE TODAY.

>> IT'S IMPORTANT TO EMPHASIZE THAT EVERY NEW COMMERCIAL AIRPLANE HAS ISSUES AS THEY ENTER SERVICE, AND NONE OF THESE IN-SERVICE ISSUES HAVE EVER SEEN THUS FAR ALTERS OUR COMPLETE CONFIDENCE IN THE 787.

>> Warner: THE 787'S INNOVATIVE DESIGN RELIES HEAVILY ON THE ELECTRICAL SYSTEM TO OPERATE ITS PARTS, RATHER THAN HYDRAULIC CONTROLS. IT'S ALSO CONSTRUCTED OF LIGHTWEIGHT COMPOSITE MATERIALS, MAKING IT MORE FUEL EFFICIENT. SO FAR, JUST EIGHT GLOBAL CARRIERS ARE FLYING 787S. BOEING HAS ORDERS FOR 800 MORE, BUT ANY MAJOR FIXES COULD CAUSE DELAYS. TODAY, TRANSPORTATION SECRETARY RAY LAHOOD SAID THERE IS NO REASON TO GROUND THE PLANES.

>> I BELIEVE THIS PLANE IS SAFE. I'D HAVE ABSOLUTELY NO RESERVATION OF BOARDING ONE OF THESE PLANES AND TAKING A FLIGHT. THESE PLANES ARE SAFE.

>> Warner: THE FAA DIDN'T ANNOUNCE A TIMETABLE FOR COMPLETING ITS REVIEW. FOR MORE ON THE "DREAMLINER'S" PROBLEMS, THE FAA REVIEW, AND WHAT'S AT STAKE FOR BOEING AND THE AIRCRAFT INDUSTRY, I AM JOINED BY ANDY PASZTOR. HE COVERS THE AEROSPACE AND AVIATION INDUSTRIES FOR "THE WALL STREET JOURNAL." ANDY, WELCOME TO THE PROGRAM.

>> MY PLEASURE.

>> Warner: HOW UNUSUAL IS IT TO HAVE THIS SORT OF HIGH PROFILE FAA REVIEW SO RELATIVELY SOON AFTER THE DEBUT OF A NEW PLANE?

>> I WOULD SAY EXTREMELY UNUSUAL, MAYBE EVEN UNPRECEDENTED. YOU HAVE TO GO BACK TO THE 1970s TO FINE A TIME WHEN THE FAA TOOK SUCH DRAMATIC ACTION. THE WAY IN WHICH IT WAS UNDER IF-- ANNOUNCED AS WELL AS THE SUBSTANCE OF THE A ANNOUNCEMENT VAL QUITE DRAMATIC.

>> NOW HE SAID THAT THE TOP PRIORITY AS I'M SURE YOU HEARD IS GOING TO BE ON THE ELECTRICAL SYSTEMS. WHY IS THAT IMPORTANT AND HOW MANY OF THE PAST INCIDENTS WE RECOUNTED ARE TIED TO THAT?

>> SEVERAL OF THE MOST SERIOUS INCIDENTS ARE TIED TO THE ELECTRICAL SYSTEMS. AND THE FAA AND BOEING ARE LOOKING AT THE LECH-- ELECTRICAL SYSTEMS PRIMARILY BECAUSE THIS PLANE USES ELECTRICITY MUCH MORE THAN FREEF PREVIOUS JETLINERS AND DOES MUCH MORE WITH IT. THE BATTERIES ARE MUCH MORE POWERFUL, THE GENERATORS ARE MUCH MORE POWERFUL, MANY OF THE SYSTEMS THAT USED TO BE RUN BY-- IN OTHER WAYS ARE NOW RUN BY ELECTRIC PUMPS. THE CABIN PRESSURE IS CONTROLLED BY ELECTRICITY. SO YOU REALLY HAVE AN EXTREMELY COMPLEX ELECTRIC GRID WHICH HAS, INDEED, PRESENTED SOME PROBLEMS AND SOME DEFECTIVE WIRING AND SOME OTHER ISSUES OVER THE TIME THIS PLANE HAS BEEN CARRYING PASSENGERS.

>> AND THEN HE ALSO SAID FROM THE WAY HE DESCRIBED THE REVIEW T SOUNDED PRETTY COMPREHENSIVE. THEY WERE GOING TO LOOK AT EVERYTHING FROM THE DESIGN ALL THE WAY THROUGH THE MANUFACTURE AND PRODUCTION. WHAT'S THE PROBLEM THERE?

>> WELL, I THINK THAT'S THE MOST INTERESTING PART OF THE STORY. IT IS EXTREMELY BROAD. DESIGN, ASSEMBLY, MANUFACTURE, AND THE ISSUE HERE IS REALLY QUITE SIGNIFICANT FOR BOEING AND THE REST OF THE INDUSTRY AND FOR FUTURE JETLINERS, IN THIS CASE BOEING DECIDED IN ORDER TO SHORTEN THE HOPE-- THE ASSEMBLY PROCESS AND SAVE SOME MONEY THEY HAD MANY SUBCONTRACTORS DESIGN AND MANUFACTURE BIG SUBSYSTEMS FOR THEM AND REALLY SEATED A LOT OF THE DESIGN WORK TO THE SUBCONTRACTORS. AND THEN THE PLANE IS A SUNNED, OF COURSE, IN A FINAL ASSEMBLY PLANT THAT BOEING OPERATES. WHAT THE FAA IS TRYING TO GET AT AND THE ISSUE THAT HAS BEEN TALKED ABOUT FOR REALLY, SINCE THE WAS EVEN CON SEEP-- CONCEIVED, IS IT POSSIBLE OR IS IT REALISTIC TO EXPECT A WIDE FLUNG, WORLDWIDE NETWORK OF SUBCONTRACTORS TO PROVIDE PARTS AND THEN TO ASSEMBLE IT IN 1 PLACE AND TO MAKE SURE THAT THE WIRES FIT NOT WIRE HARNESSES, THAT THE PARTS FIT CORRECTLY. THIS IS A HUGE ISSUE FOR THE INDUSTRY. AND THIS IS A BIG TEST CASE THAT THE FAA IS NOW DELVING INTO.

>> Warner: IT'S SORT OF LIKE THE GLOBAL MANUFACTURING ON STEROIDS IN TERMS OF OT PROCESS THAT ACTUALLY A LOT OF DIFFERENT MANUFACTURING COMPANIES AND PRODUCTS ARE USING?

>> WELL, NASS'S ABSOLUTELY RIGHT. BUT IN THIS CASE YOU'RE TALKING ABOUT SUPERSOPHISTICATED SYSTEMS ON TOP OF AN AIRCRAFT THAT ITSELF HAS TECHNOLOGY WHICH IS CUTTING EDGE. SO REALLY THE FAA IS I BELIEVE IS CONCERNED BECAUSE THEY ARE WORRIED ABOUT SOME OF THE DESIGN ISSUES BUT ALSO QUITE CONCERNED TO MAKE SURE THAT THE ASSEMBLY IS BEING DONE CORRECTLY. AND IT'S A VERY UNUSUAL SITUATION. THIS PLANE IS CARRYING PASSENGERS. IT WAS CERTIFIED IN LATE 2011. AND IN EFFECT THE FAA TODAY SAID, WELL, WE THINK WE DID OUR WORK VERY WELL. AND WE THINK THE PLANE IS SAFE. BUT WE HAVE TO DOUBLE-CHECK BECAUSE OF THESE, THE NUMBER AND TYPE OF INCIDENTS THAT HAVE OCCURRED. THIS HASN'T HAPPENED IN RECENT MEMORY ON ANY MAJOR JET TRANSPORT.

>> Warner: SO WHAT'S AT STAKE FOR BOEING. HOW MUCH OF THEIR FUTURE IS RIDING ON THIS JETLINER?

>> BOEING IS OF COURSE A GLOBAL COMPANY WITH LOTS OF PROGRAMS AND HUGE REVENUE. BUT I THINK THIS IS A VERY IMPORTANT MOMENT. IT'S REALLY A WAKE-UP CALL FOR THE COMPANY. AND IT'S IMMEDIATE FINANCIAL CONDITION MAY BE ITS MIDTERM FINANCIAL CONDITION, ITS REPUTATION, ITS RELATIONS WITH INVESTORS AND WITH CUSTOMERS AND WITH PASSENGERS REALLY ARE AT STAKE HERE. THIS IS EXTREMELY SIGNIFICANT STEP. IT'S NOT A MAKE-OR-BREAK ISSUE FOR THE COMPANY, I DON'T BELIEVE, BECAUSE IT'S TOO BIG FOR THAT. BUT THIS IS AN EXTREMELY IMPORTANT TURNING POINT FOR BOEING. COULD BE AN EXTREMELY IMPORTANT TURNING POINT, OF COURSE, DEPENDING HOW THE REVIEW TURNS OUT AND WHAT THEY FIND.

>> Warner: DO WE KNOW WHEN THE REVIEW WILL BE DONE?

>> NO. THE FAA HAS BEEN VERY CAREFUL NOT TO SKETCH OUT A TIME LINE FOR IT. BOEING SAYS IT'S COOPERATING WITH THE REVIEW AND HAS ITS EXPERTS WORKING ON IT. I UNDERSTAND FROM PEOPLE I TALK TO THAT BOEING WAS QUITE RESISTANT IN THE BEGINNING TO THIS IDEA BUT IT REMAINS TO BE SEEN WHAT THE FAA COMES UP WITH. TO SOME EXTENT THE FAA IS, INDEED, REACTING TO PUBLIC PRESSURE AND PUBLIC CONCERNS AND SO I'M NOT SURE THAT THE FAA OFFICIALS THEMSELVES AT THIS POINT REALLY KNOW WHAT DIRECTION THEY WANT TO HEAD IN. THEY ARE GOING TO LOOK AT THE DATA AND THAT COULD TAKE I WOULD SAY SEVERAL MONTHS, AT LEAST.

>> ANDY PASZTOR FROM THE "THE WALL STREET JOURNAL", THANK YOU.

>> THANK YOU.

>> Brown: THIS WEEK PROVIDED A GLIMPSE OF THE LATEST IN TECHNOLOGY AND HIGH-END GADGETS AT THE ANNUAL CONSUMER ELECTRONICS SHOW, WHICH WRAPPED UP TODAY IN LAS VEGAS. RAY SUAREZ IS OUR GUIDE.

>> Suarez: IT'S STILL ONE OF THE LARGEST TECH EVENTS OF THE YEAR, EVEN AS MANY PEOPLE BUY THEIR ELECTRONIC TOY FROM ITS APPLES AND GOOGLES OF THE WORLD. MORE THAN 150,000 PEOPLE MADE THE TREK TO LAS VEGAS THIS WEEK TO PEEK AT SOME CUTTING EDGE ELECTRONICS, SOME OF THE BUZZ THIS YEAR FOCUSED ON HUGE NEW TV WEST WHAT IS NOW CALLED ULTRA HD. AS WELL AS BENDABLE SMART PHONES, EVEN DRIVERLESS CARS. CECILIA KING HAS BEEN COVERING IT FOR THE WASHINGTON POVMENTS I CAUGHT UP WITH HER BEFORE THE CONVENTION. WELCOME BACK TO THE PROGRAM. AT THE RISK OF OVERSIMPLIFICATION, SOME YEARS AT THE CONSUMER ELECTRONICS SHOW ARE FILLED WITH STARS OF THE SHOW, BIG TECHNOLOGICAL BREAKTHROUGHS. AND SOME JUST FEATURE A LOT OF IMPROVEMENTS TO THINGS PEOPLE ARE ALREADY FAMILIAR WITH. WHAT KIND OF YEAR WAS THIS?

>> THIS WAS DEFINITELY A MIX OF BOTH. THERE WERE SOME FAMILIAR TECHNOLOGIES THAT WERE IMPROVED, LOTS OF INTERESTING SORT OF HIGHER QUALITY RELEASE OS OF TVs AND SMART PHONES AND TABLETS. BUT THERE WERE ALSO SOME REALLY INTERESTING TECHNOLOGY SHOWCASED THAT REALLY KIND OF BLEW MY MIND AND CAN BLOW YOUR MIND AS A BUSINESS AN A CONSUMER THINKING ABOUT HOW A DRIVERLESS CAR, FOR EXAMPLE, OR A 3-D PRINT KERR REALLY CHANGE YOUR LIFE.

>> WHAT'S A 3-D PRINTER?

>> A 3-D PRINTER TAKES A COMPUTER DESIGN, A COMPUTER DESIGN AND CREATES REALLY OUT OF THIN AIR A REAL OBJECT USING POWDERED VERSIONS OF MATERIAL IT BE PLASTIC, METAL AGE BY LAYERING OVER ONE LAYER OVER ANOTHER, THOUSANDS OF PAPER THIN SHEETS OF THIS POWDER, IT CAN CREATE TOOLS. IT CAN CREATE SOMETHING AS INTERESTING AS A GUITAR OR AN iPHONE CASE. IT CREATES A REAL LIFE 3-D OBJECT. OUT OF A BOX NASS'S NO BIGGER THAN SAY A MICROWAVE.

>> Suarez: SO EVERYBODY CAN BECOME THEIR OWN MANUFACTURER?

>> ESSENTIALLIES THAT A TRUE. YOU KNOW FORD AND NASA ARE PUTTING THESE PRINTERS ON EVERY ENGINEER'S DESK. AND THEY ARE USING THIS TO TRY TO SIMULATE TRANSMISSION PARTS, ROCKET SHIP PARTS, REALLY, TO TRY TO SEE IF PARTS WORK. AND IT'S REALLY A BIG DISRUPTION IN THE MANUFACTURING CHAIN BECAUSE IF YOU CAN DO THAT AT LOW COST FOR A COUPLE THOUSAND DOLLARS, CREATE SAY A NEW TRANSMISSION OR BRAKE PART TO TEST OUT, THAT'S A VERY DIFFERENT WAY OF MANUFACTURING THE WAY THAT HAS BEEN DONE FOR MANY, MANY DECADES WHERE YOU AUTO MANUFACTURE, FOR EXAMPLE, TO CREATE THOUSANDS OF ONE TRANSMISSION PART AND SEE IF IT WORKS. AND IF IT DOESN'T, THEN THEY HAVE TO SUCK UP A THOUSAND PARTS THAT THEY MADE.

>> FOR YEARS IS THE SHOW FEATURED BIGGER AND BETTER WITH EYE-POPPING VISH I'MS, DEM CRATE SHALL DID -- DEMONSTRATING HOME THEATRES, ARE WE STILL GOING DOWN THAT ROAD EVEN THOUGH TV SHOWS ARE SOFT RIGHT NOW.

>> TV MANUFACTURERS, SAM SUJ, LG, SONY, PAN SOCKIC, WESTING HAAS, THEY ARE ALL SHOWING TVs AGAIN THIS YEAR. AND THAT'S A BIG PART OF THE SHOW. AND CONSUMERS AS YOU SAID, RAY, ARE NOT AS INTERESTED IN THESE VERY EXPENSIVE TVs, THE 3-DTVs SHOWCASED THE LAST COUPLE OF YEARS BUT AGAIN THIS YEAR THESE MANUFACTURERS SHOWCASE THEM. AND ULTRA HDTV, HIGH-DEFINITION TVS SO PACKED WITH SO MANY PIXELS THE QUALITY VAL BREATHTAKING AND AMAZING. BUT THE PRICE TAGS ARE ALSO REALLY HIGH. AND CONSUMERS ESPECIALLY ARE TRYING TO CHOOSE BETWEEN CERTAIN TECHNOLOGIES AND THE TV ALSO NOT QUITE CAPTURING THE INTERESTS OF THESE COMPANIES WOULD LIKE FOR THEM TOO.

>> AT THE SAME TIME THEY'RE PUSHING OUT 66 INCH TREES, THEY'RE ALSO TRYING TO GENT US TO WATCH ON SCREEN 6 INCHES AND SMALLER, ON TABLETS AND SMART PHONES. IS THAT AREA MOVING AHEAD?

>> THAT AREA WILL ONLY MOVE AWAY MORE QUICKLY AND STRONGLY AROUND THE GLOBE. MOBILE DEVICE USAGE IS EXPLODING. AND REALLY THE U.S. MANUFACTURERS AND ASIAN MANUFACTURERS EUROPEAN MANUFACTURERS ARE ONLY STARTING TO SEE THE REAL BENEFITS OF THE KINDS OF SMART PHONE AND TABLET TECHNOLOGY THEY PRODUCED IN THE LAST FEW YEARS. A LOT OF EMERGING MARKETS ARE GOING TO BE HUGE MARKETS FOR COMPANIES LIKE APPLE AND GOOGLE AND MICROSOFT AND NOKIA. SO THEY ARE REALLY PUSHING FOR LOWER END, IN SOME WAYS LOWER PRICED SCREENS AND DEVICES AS WELL AS SOME OF THE CUTTING EDGE HIGHER END MORE EXPENSIVE DEVICES. SAMSUNG CAME UP WITH A VERY INTERESTING 5.5 INCH FLEXIBLE SCREEN THAT KIND OF MAKES YOU IMAGINE ALL KINDS OF POSSIBILITIES OF HOW OT SCREEN CAN BE USED. YOU CAN, FOR EXAMPLE, BEND A SCREEN IN YOUR HAND IF YOU ARE HOLDING ON TO SAY A SUBWAY RAIL AND READING AN EBOOK WITH THE OTHER HAND AND FOLD IT INTO THE CUP OF YOUR HAND. THESE ARE REALLY INTERESTING POSSIBILITIES. AND IT CREATES NEW MARKETS AND NEW AVENUES FOR GROWTH FOR THESE COMPANIES.

>> IN RECENT YEARS COMPANIES WE REALLY DIDN'T THINK OF AS MAKERS OF EQUIPMENT, AMAZON, GOOELING, MICROSOFT, PLACES THAT HAVE EARNED THEIR BONES IN OTHER PARTS OF THE COMPUTING OR COMMUNICATIONS BUSINESS WERE BIG PLAYERS AT THE CONSUMER ELECTRONICS SHOW. IS THAT STILL THE CASE?

>> THOSE BIG VERY CUTTING EDGE INNOVATERS IN THE SMART PHONE AND TABLET IN PARTICULAR ARE ACTUALLY NOT REALLY HERE AT THE CONSUMER ELECTRONIC SHOW. BUT THEY ARE CERTAINLY FELT HERE IN THAT THERE IS A LOT OF FLOOR SPACE DEDICATED TO ACCESSORY TO ITS IPHONE O FOR EXAMPLE. BUT APPLE DOESN'T EVEN HAVE A BOOTH HERE. GOOGLE DOESN'T EITHER AND AMAZON HAS A SMALL PRESENCE. THESE COMPANIES ARE DEFINITELY DISRUPTING THE MARKET AND CREATING SOME OF THE MOST INTERESTING HARDWARE, AS YOU MENTIONED. AND THEY, BUT THEY HAVE PREFERRED TO CARRY OUT THEIR OWN SHOW. IT'S REALLY HARD TO COMPETE WITH THE NOISE OF ALL THE DIFFERENT PRODUCT RELEASES AND NEWS RELEASES THAT COME OUT. SO THEY WOULD LIKE TO HAVE THEIR OWN SHOWS AND GAIN THEIR OWN ATTENTION BY DOING THEIR OWN RELEASES. AND SO THAT'S BEEN THE TREND FOR THE LAST COUPLE OF YEARS. MICROSOFT EVEN WHICH WAS A HUGE PRESENCE, REALLY AN ANCHOR TO THE CONSUMER ELECTRONIC SHOW SORT OF SCALED BACK THIS WE ARE. >>. THEY WERE CERTAINLY HERE TRYING TO PUSH THEIR WINDOWS 8 DEVIALSES BUT THEY DIDN'T HAVE THE PRESENCE THAT THEY HAD-- THAT THEY HAVE HAD IN RECENT YEARS.

>> Suarez: I WILL BE KEEP AND AN EYE ON WHAT YOU FILE. THANKS FOR JOINING US.

>> THANK YOU, RAY.

>> Brown: YOU CAN GET MORE ONLINE ABOUT THIS YEAR'S MOST PROMISING GADGETS, AS WELL AS SOME DISAPPOINTMENTS, FROM GUEST TECH BLOGGER ROB PEGORARO. THAT'S ON THE "RUNDOWN."

>> Woodruff: AND TO THE ANALYSIS OF SHIELDS AND BROOKS-- SYNDICATED COLUMNIST MARK SHIELDS AND "NEW YORK TIMES" COLUMNIST DAVID BROOKS. BELL COME BACK, JAE, JAE.

>> THANK YOU, JUDY.

>> Woodruff: SO AFGHANISTAN, THE PRESIDENT MET WITH HAMID KARZAI AT THE WHITE HOUSE. DAVID WHAT DO YOU MAKE OF THIS ANNOUNCEMENT OR SENSE NOW THAT THEY GOING TO TRY TO GET U.S. TROOPS OUT OF A COMBAT ROLE QUICKER THAN EXPECTED.

>> I GUESS I'M MOSTLY IMPRESSED BY HOW LITTLE RESISTANCE THERE IS TO US HITTING THE EXIT. SOME OF IT BUDGETARY, YOU CAN'T AFFORD IT I GUESS I HAVE TWO CONCERNS. ONE IS WHAT HAPPENS TO SCHOOL GIRLS THERE. IF THE TALIBAN TAKES OVER PART OF THE COUNTRY AND SECOND, AND THIS GOES TO THE WHOLE MOOD OF THE COUNTRY RIGHT NOW, SUPPOSE SOMETHING HAPPENS AND WE HAVE TO DO SOMETHING EXPRESS-- EXPENSIVE AROUND THE WORLD. WHERE IS THE MONEY GOING COME FOR THAT. WHERE IS THE PUBLIC WILL ARE GOING COME FROM. THE MOOD OF THE COUNTRY, IT'S NOT ISOLATIONIST, BUT IT'S DON'T BOTHER US NOW, WE-- IS VERY UNLIKELY THAT WE'LL GO 8 YEARS WITHOUT HAVING A MAJOR FOREIGN CRIES THAS WILL COST US SOMETHING. WHEN THAT CRISIS COMES, WILL WE TURN AROUND AND SAY, OKAY, WE'RE BROKE BUT WE'RE GOING TO SPEND THE MONEY TO DO THIS?

>> SO MORE ARGUMENTS FOR GETTING OUT SOONER.

>> I THINK RIGHT NOW THERE IS NO RESISTENCE, THAT THE PRESIDENT COULD PULL EVERYTHING OUT AS BEN RODES SAID AND THERE WOULD BE SOME PEOPLE ON CAPITOL HILL THAT WOULD RAISE SOME QUESTIONS.

>> Woodruff: HOW DO YOU SEE IT?

>> I THINK DAVE IS RIGHT ABOUT THE LACK OF RESISTENCE. I THINK THERE IS A SENSE, JUDY, THAT REGARDLESS OF 25,000 TROOPS, 30,000 TROOPS, THAT IS, IT AMOUNTS TO A START, AND REMINDED ME OF WHAT SENATOR EARNEST HOLDING SAID ABOUT RONALD REAGAN SAID IN 1800, MARINE OS IN LEBANON, TOO FEW TO FIGHT, TOO MANY TO DICHLT AND OF COURSE 241 BLOWN UP IN BARACKS IN BEIRUT. BUT I THINK THERE IS NOT A SENSE OF MISSION. I THINK THAT CONTRIBUTES TO THE WILLINGNESS.

>> SO THIS DEBATED SOUNDS LIKE IT IS ALL BUT OVER.

>> YEAH, I DON'T KNOW WHAT WILL HAPPEN ON CAPITOL HILL. I'M NOT SURE THAT THE POLITICAL MAJORITY OR EVEN SIZABLE MINORITY IN THE COUNTRY IS GOING SAY WE WANT TO YOU STAND UP AND FIGHT TO MAINTAIN 50,000 AMERICAN TROOPS IN AFGHANISTAN.

>> SO THE MAN DAVID THE PRESIDENT WANTS TO OVERSEE THE WITHDRAWAL, THE DRAWDOWN AND WITHDRAWAL IS CHUCK HAGEL TO HEAD THE PENTAGON. WE TALKED ABOUT HIM LAST WEEK. YOU SAID THEN THAT YOU THOUGHT IT WOULD BE HARD TO GET HIM CONFIRMED. DO YOU STILL --

>> I CHANGE MY MIND. WELL, I WAS RIGHT THEN. BUT REALITY HAS CHANGED SO I'M ALSO RIGHT NOW. I THINK HE'S GOING TO GET CONFIRMED. THERE IS REPUBLICAN OPPOSITION. SOME PEOPLE ARE SAYING THERE IT IS UP TO CHUCK SCHUMER, FROM NEW YORK. HE HELD A KEY POSITION. THE IDEA THAT CHUCK SCHUMER IS GOING TO VOTE AGAINST PRESIDENT OBAMA DEFENSE SECRETARY SEEMS SMALL. I THINK HE IS LIKELY TO GET IT. THE ONE THING THAT STRIKES ME WITH THESE PICKS, JOHN KERRY, CHUCK HAGEL, IS THAT LIKE OBAMA, THEY WERE AMONG THE SOCIAL SENATORS, THEY HAVE A SAME PROFILE, MORE INTELLECTUAL, BUT THEY WERE NOT JOE BIDEN GOING AROUND SHAKING EVERYBODY'S HANDS, FROM A TEAM OF RIVALS TO A TEAM OF LONE OTHERS SO THEY ARE VERY SIMILAR TEMPERMENTAL.

>> Woodruff: WHAT DOES THAT SAY AND THOUGH THROW IN JOHN BRENNAN.

>> I THINK THE CHUCK HAGEL THING, 579 CABINET OFFICER NOTICE HISTORY OF THE UNITED STATES, AND A GRAND TOTAL OF NINE NOMINEES HAVE BEEN REJECTED BY THE UNITED STATES SENATE IN AN UP OR DOWN VOTE AND EXACTLY ONE SINCE 1989 AND TWO SINCE 1959. I MEANS THAT'S ALL. SO THE IDEA OF CHUCK HAGEL BEING REJECTED AND THE LATE JOHN TO YOUER WHO WAS REJECTED AS SECRETARY OF DEFENSE, FORMER SENATOR THERE WERE LARGE QUESTIONS ABOUT HIS ETHICAL DEALINGS IN BUSINESS AND HIS PERSONAL BEHAVIOR TOWARD WOMEN, AND HIS PERSONAL KPKPTMENT. AND THERE IS NONE OF THAT WITH CHUCK HAGEL. I MEAN THERE IS NO SCANDAL. THERE IS NO BACKGROUND THAT'S GOING TO COME OUT AND BITE. SO I THINK WILL YOU-- HE'S NOT THE FIRST ENLISTED MAN. BILL PERRY WHO IS BILL CLINTON'S FIRST SECRETARY OF DEFENSE WAS BRIEFLY BUT THEN BECAME AN OFFICER. HE IS A COME BAT VETERAN. I THINK IT IS INTERESTING, DAVID MENTIONED JOHN KERRY. JOHN KERRY, JIM WEBB, DAN INO WAY DIED, JIM WEBB LEFT VOLUNTARILY, JOHN KERRY WILL LEAVE. THEY MR. ONLY FOUR MEMBERS OF THE UNITED STATES SENATE, JOHN McCAIN BEING THE FOUFERMENT I MEAN SO WHAT YOU HAVE IN KERRY AND HAGEL ARE TWO MEN WHO HAVE SEEN WAR UP FRONT AND UP CLOSE, AND WHO HAVE BECOME FAR MORE RELUCTANT TO DEPLOY AMERICANS. THEY DON'T TALK IN THE ANCIENT LANGUAGE OF SWAGGER HOW WE ARE GOING TO GO IN AND KICK SOME TAIL, OR ANYTHING OF THE SORT LIKE SO MANY OF THE NONCOMBATANTS DO. SO I THINK THAT HAGEL, I THINK BRENNAN WILL BRING UP A DISCUSSION. WE'LL FIND OUT HOW LIB RALTS, IN FACT, THEY REALLY DO CARE ABOUT THE USE OF DRONES IN THIS ADMINISTRATION. THE SEEMS TO HAVE GIVEN A PASS TO PRESIDENT OBAMA, USED DRONES MORE THAN PRESIDENT BUSH EVER DID AND I THINK THE REPUBLICANS WILL USE IT TO DISCUSS BENGHAZI BUT I THINK WILL CONFIRMED AS WELL.

>> Woodruff: BOTH OF THEM. YOU WERE TALKING ABOUT A GROUP OF LONERS. WHAT ARE THESE CHOICES AND WHAT WE KNOW SO FAR ABOUT THE PRESIDENT'S WHITE HOUSE STAFF AND CABINET SAY ABOUT THE PRESIDENT, DAVID.

>> IT'S NOT EXACTLY GREAT COPY FOR US. THEY ARE NOT THE MOST EXCITING GROUP, NECESSARILY. THEY ARE A GROUP THAT HAS, ARE PEOPLE OF INTEGRITY, EVERY SINGLE ONE OF THEM, NO SCANDALS INCLUDING THE NEW TREASURY OF SECRETARY JACK LEW SO THERE WILL BE NO SCANDAL OR NO STUPIDITY, WOB EXCEPTION THERE IS CAUTIOUS, RELIABLE, RESPONSIBLE AND FOR THE MOST PART EXTREMELY EXPERIENCED. AND SO I GIVE THEM HIGH MARKS FOR THESE SORTS OF THINGS. I THINK THE WAY YOU FAULT A PRESIDENT IS THEY ARE ALREADY VERY WELL-KNOWN TO HIM, HAVE BEEN FOR A LONG TIME. A LOT OF THEM ARE ALREADY WORKING FOR HIM AND ARE PROBABLY EXHAUSTED BY WHAT IS HAPPENING OVER THE LAST FOUR YEARS. SECOND, NOBODY FROM BISMTS I REALLY THINK IT WOULD HAVE BEEN USEFUL TO HAVE SOMEBODY FROM THE BUSINESS COMMUNITY. THIRD, STILL VERY STRONG ON THE HARVARD, YALE, PRINCETON AXIS, VERY OF THE ESTABLISHMENT OF THE DEMOCRAT CENTRAL LEFT DEMOCRATIC PARTY. AND SO IF YOU WANTED SOME FRESHNESS, IF YOU WANTED SOMEBODY OUTSIDE THE BOX, SOMEBODY WHO WOULD BRING SOMETHING NEW TO AN ADMINISTRATION THAT IS ALREADY TIRED BECAUSE OF WHAT HAS HAPPENED, I DON'T THINK YOU SEE THAT. SO YOU SEE CAUTION, SAFETY, INTELLIGENCE AND EXPERIENCE. YOU DON'T SEE FRESH.

>> IF YOU WANT DIE VIRTS, I MEAN YOU HAVE THE UNIVERSITY OF NEBRASKA, CHUCK HAGEL. YOU'VE GOT SOMEBODY WHO STARTED HIS OWN BUSINESS. YOU HAVE SOMEBODY WHO IS PRO GUN, PRO-LIFE, ANTI-TAX, I MEAN HE CERTAINLY DOESN'T FIT INTO ANY IDEAOLOGICAL COOKIE CUTTER. I AGREE WITH DAVID THAT THE PRESIDENT LIKES PEOPLE AROUND HIM THAT HAVE BEEN THERE. I THINK JACK LEW IS AN EXCEPTIONALLY GOOD CHOICE TO BE SECRETARY OF TREASURY. THIS IS NOT ABOUT SAVING DETROIT. IT'S NOT ABOUT THE BANKING SYSTEM COMING TO COLLAPSE. WE'RE IN A FISCAL AND BUDGETARY BIND OF HISTORIC PROPORTION AND IT'S GOING TO BE CONGRESS TO A GREAT DEGREE AND THE WHITE HOUSE. AND I THINK THAT ANYBODY WHO HAS BEEN TWICE BUDGET DIRECTOR, JUDY, 30 YEARS AGO, JACK LEW WAS NEGOTIATING FOR THE SPEAKER OF THE HOUSE O THOMAS P O'NEILL WHEN THEY WERE DOING THE GREENSPAN COMMISSION ON SOCIAL SECURITY BETWEEN RONALD REAGAN'S WHITE HOUSE AND THE DEMOCRATS IN THE HOUSE. I MEAN HIS EXPERIENCE IS-- HE DOESN'T HAVE PAN ACH, HE DOESN'T HAVE DASH, HE'S NOT GOING TO GIVE YOU, YOU KNOW, TWO COLOURFUL THINGS. HE'S TO THE GOING TO TALK OFF THE RECORD LIKE THAT THE. BUT I JUST THINK HE IS A GREAT CHOICE.

>> QUICKLY, SOME CONVERSATION THIS WEEK ABOUT LACK OF DIVERSITY SO FAR IN THE PRESIDENT'S PICK. SHOULD WE BE --

>> YOU KNOW, RUTH MARCUS SAID HE SHOULD HAVE HAD SOME BINDERS FULL OF WOMEN. YOU FOR EXAMPLE I DO THINK RUTH MADE THE POINT THAT THERE IS NOT A LOT-- THERE'S NOT A LOT OF DIVERSITY IN JUST THE WORLDVIEW HE BRINGS TO ITS OFFICE. IF IT'S A BUNCH OF WHITE MEN, THERE IS SOME LOSS THERE. I DO THINK VALERIE JAR SETS STILL THERE WHO IS A VERY IMPORTANT AND MUCH, NOT TALKED ABOUT AS MUCH OF THE ADMINISTRATION AND VERY PO WESTERLYFUL. SO SHE DOES HAVE A DIFFERENT DEMOGRAPHIC BACKGROUND. I DO THINK THE LACK OF DIVERSITY IS MORE PARENT, AND JUST THE LACK OF SPREADING OUT ACROSS THE COUNTRY, DIVERSITY OF BACKGROUND. I DO THINK THAT IS STILL A BIT LACKING. BUT I DON'T THINK THAT IS THE FUNDAMENTAL PROBLEM. I THINK THE FUNDAMENTAL PROBLEM IS A LITTLE INSURANCE LARITY.

>> I THINK, AND DON'T ARGUE WITH THAT. I THINK IT'S NOT UNIMPORTANT FOR PEOPLE TO SEE PEOPLE LIKE THEMSELVES, IN POSITION OF LEADERSHIP. AND I THINK THAT IS VERY IMPORTANT. I THINK IN THAT SENSE THAT YOU DONE WANT PEOPLE, THIS THEY ARE QUALIFIED AND ARE GOING TO DO WELL. ARE GOING TO SUCCEED. YOU DON'T WANT TO JUST SEE PEOPLE WITHOUT BECOME SYMBOLS. THE QUINTESSENTIAL EXAMPLE OF THAT IS HILLARY CLINTON, HILLARY CLINTON HAS SUCCEEDED AS SECRETARY OF STATE. AND IN MANY REGARDS I THINK IS AN INSPIRATION NOT SIMPLY TO HER GENDER BUT ALL KINDS OF AMERICANS, RECOGNIZED BY THE FACT THAT SECOND ONLY TO CHRIS CHRISTIE SHE'S THE MOST POPULAR POLITICAL FIGURE IN AMERICA, WHO IS THE MOST POPULAR FIGURE.

>> Woodruff: WE WILL GET A CHANCE NEXT WEEK TO TALK ABOUT GUNS AND WE ONLY HAVE A PIN. BUT AT THIS POINT WHAT ARE YOU HEARING THAT WILL COME OUT OF THE WHITE HOUSE AND WILL IT FLY IN THE CONGRESS.

>> I THINK THE VIEW NOW IS THERE WILL BE SOME REFORMS. CLOSING SOME OF THE GUN LOOPHOLES, MAYBE SOME OF THE MAGAZINE RELATED ISSUES BUT YOU WON'T GET THE AMBITIOUS THING LIKE THE ASSAULT WEAPONS BAN THAT DIANE FEINSTEIN WAS TRYING TO GET.

>> Woodruff: YOU ARE SAYING THEY WILL ASK FOR IT.

>> MY OWN SENSE IS THEY WON'T EVEN ASK FOR IT. THEY WILL ASK FOR THE SMALLER THINGS AND I THINK THERE IS A REALISTIC CHANCE OF GETTING THOSE PASSED.

>> I THINK THE BACKGROUND CHECK WILL BE PUSHED AND PUSHED HARD. THE QUESTION IS WILL IT BRING TO IT THE SAME LEVEL OF INTINTS AND RELENTLESSNESS AND EXPERTISE THAT THEY BROUGHT TO THE CAMPAIGN. I MEAN I THINK THERE IS SAY CHANCE HERE. I THINK THE NRA HAS STUMBLED BADLY. THEY BOAST AN INCREASE IN MEMBERSHIP. I THINK THEY ARE LIKE THE TEA PARTY. THEY MISUNDERSTAND WHAT IS GOING ON IN THE COUNTRY, THE CHANGE IN MOOD IN THE COUNTRY, ESPECIALLY AFTER NEWTOWN. THE TEA PARTY DEFEATED RICHARD LUGGAR IN INDIANA AND WAS FULL OF THEMSELVES AND NOW INSTEAD OF CONSERVATIVE REPUBLICAN HOLDING THAT SEAT, LIKE LUGAR IT IS A MODERATE DEMOCRAT JOE DONE OLY HOLDING THAT SEAT. I THINK THE NRA IS VERY MUCH IN THE SAME MY OP OIK MIND-SET. AND I THINK THAT SHALL DID --.

>> I THINK I DISAGREE. I THINK THEY KNOW WHAT THEY ARE DOING. THEY KNOW WHAT IS HAPPENING BUT THEY ARE MAKING SURE GUN OWNERS THINK OBAMA GOING TO TAKE AWAY YOUR GUNS.

>> Woodruff: THANK YOU BOTH. AND MARK AND DAVID KEEP UP THE TALK ON THE "DOUBLEHEADER," RECORDED IN OUR NEWSROOM. THAT WILL BE POSTED AT THE TOP OF THE RUNDOWN LATER TONIGHT.

>> Brown: FINALLY, A WORD ABOUT TONIGHT'S EDITION OF "NEED TO KNOW" ON PBS. AS THE DISCUSSION GOES ON IN WASHINGTON ABOUT REVISING THE FEDERAL TAX CODE, "NEED TO KNOW" PROFILES FOUR NEW JERSEY RESIDENTS WITH DRAMATICALLY DIFFERENT INCOMES TO DEMONSTRATE HOW CURRENT TAX REGULATIONS DISPROPORTIONATELY BENEFIT SOME AMERICANS MORE THAN OTHERS. MEGAN THOMPSON REPORTS "A TALE OF FOUR TAX RETURNS." HERE'S AN EXCERPT.

>> JUST AS THERE ARE MAJOR DIFFERENCE NOTICE BENEFITS PAID TO LOWER WAGE EARNERS, THERE ARE ALSO HUGE DISCREPANCIES BETWEEN WHAT THE WELL OFF AND THE VERY RICH PAY. IN FACT, SETH HAND WHO EARNS AN UPPER MIDDLE CLASS WAGE AS A UNION STAFFER ACTUALLY PAYS MORE PROPORTIONALLY IN FEDERAL INCOME TAXES THAN MULTIMILLIONAIRE ERIC SCHONBERG. IN 2010 HAND EARNED ABOUT $84,000 AND PAID $14,925 IN FEDERAL INCOME TAX.

>> DOW OWN A HOME OR ARE YOU RENTER.

>> WE RENT AN APARTMENT RIGHT NOW.

>> OKAY. SO THERE IS NO MORTGAGE INTEREST DEDUCTION THAT ARE YOU TAKE ON YOUR TAX RETURN.

>> RIGHT, THAT IS CORRECT.

>> DID YOU MAKE CHARITABLE CONTRIBUTIONS IN 2010 THAT YOU COULD DEDUCT FROM YOUR TAXES.

>> YES, I DID. I DIDN'T DEDUCT ANYTHING ON MY TAXES.

>> HOW ABOUT STATE AND LOCAL TAXES.

>> JUST DID THE STANDARD DEDUCTION IN 2010 AND DIDN'T DEDUCT ANY STATE OR LOCAL TAX. THERE ARE LOTS OF DEDUCTIONS THAT I-- THAT WERE NOT AVAILABLE TO ME IN 2010.

>> FOR SOMEONE WHO HAS AN INCOME IN THE MIDDLE, WHOSE SINGLE, NO KIDS, RENTS, WHAT DOES THE TAX CODE DO FOR THAT PERSON.

>> THE TAX CODE I WOULD SAY FOR THAT PERSON COMES EARLY AND OFTEN AND THAT PERSON SHOULD WANT TAX REFORM THAT GETS OUR RATES LOWERED. TWO-THIRDS OF AMERICAN DO NOT ITEMIZE DEDUCTIONS BUT WE DON'T CARE WHAT DEDUCTIONS AND LOOPHOLES THERE AREMENT BECAUSE WE DON'T, WE USE THE STANDARD DEDUCTION.

>> SO TWO-THIRDS OF AMERICANS CAN'T OR DON'T TAKE ADVANTAGE OF THESE DEDUCTIONS.

>> CORRECT.

>> WHO IS THIS ONE THIRD OF AMERICANS WHO CAN.

>> IN GENERAL, THE HIGHER INCOME, THE MORE LIKELY YOU ARE TO ITEMIZE AND ITS MORE LIKELY ARE YOU TO GET SIGNIFICANT BENEFITS OUT OF ITEMIZED DEDUCTIONS.

>> HIGHER INCOME TAXPAYERS LIKE ERIC SCHONBERG.

>> I DO TAKE A SUBSTANTIAL TOTAL NUMBER OF DEDUCTIONS.

>> IN 2010 SCHONBERG EARNED NEARLY $725,000. BUT JUST GOING BY THE BOOK, HE WAS ABLE TO DEDUCT MORE THAN $160,000. THIS INCLUDED MORE THAN $42,000 FOR NEW JERSEY HIGH STATE AND LOCAL TAXES, AND ALMOST 68,000 IN GIFTS TO CHARITIES. SCHONBERG HAS PAID OFF HIS HOUSE BUT FOR MANY YEARS TOOK A DEDUCTION FOR INTEREST PAID ON HIS MORTGAGE. SCHONBERG'S TAX RETURN IS NOT UNIQUE. IN FACT, AFFLUENT TAXPAYERS RECEIVE THE VAST MAJORITY OF BENEFITS FROM DEDUCTIONS. IN 2011 THE OVERWELL AMING PERCENTAGE OF GAINS IT FROM THE MORTGAGE INTEREST DEDUCTION, THE CHARITABLE DONATION DEDUCTION, AND THE STATE AND LOCAL TAX DEDUCTION ALL WENT TO TAXPAYERS MAKING MORE THAN $100,000 A YEAR.

>> THOSE THAT EARNED THE HIGHEST INCOME GET THE MOST BENEFIT FROM TAX DEDUCTION AND THOSE THAT EARN THE LOWEST INCOMES OR LOWER INCOME AMOUNTS GET THE LEAST BENEFIT.

>> SO IT'S UPSIDE DOWN.

>> BUT ONE OF SCHONBERG'S BIGGEST BREAKS DIDN'T COME FROM ANY DEDUCTION. IT CAME FROM HOW HE EARNED HIS MONEY.

>> IN 2010 OF THAT 724,000, ABOUT 51,000 WAS FROM WAGES AND SALARIES. SO THIS WOULD HAVE BEEN EARNINGS FROM MY TEACHING.

>> WAGES AND SALARIES WERE SUBJECT TO INCOME TAX RATES THAT UNTIL THIS MONTH TOPPED OUT AT 35%.

>> THE SINGLE BIGGEST CATEGORY WHICH IS TYPICALLY THE CASE FOR ME WAS CAPITAL GAINS. I HAD 404,000 IN CAPITAL GAINS IN 2010. DO YOU THINK ARE YOU GOING TO BE HAPPIER IF YOU BECOME RICH.

>> THAT CAPTAIN GAINS INCOME WAS TAXED AT A MUCH LOWER RATE OF 15%. AND BECAUSE INVESTMENT INCOME, NOT WAGES FROM A JOB MADE UP THE BULK OF HIS EARNINGS, HIS EFFECTIVE TAX RATE, THE OVERALL PERCENTAGE IN TAXES HE PAID, WAS ONLY 15.9%. BUT REMEMBER SETH HAND WHO EARNED ALL HIS 84,000 FROM HIS JOB, HE PAID AN EFFECTIVE TAX RATE OF 17.7%.

>> THIS GUY MAKES 8 TIMES THE AMOUNT THAT YOU MAKE, AND HE'S PAYING A LOWER EFFECTIVE TAX RATE THAN YOU. WHAT DO YOU THINK ABOUT THAT?

>> IT'S REALLY SORT OF OUTRAGEOUS THAT IT IS HAPPENING AND REALLY SORT OF OUTRAGEOUS THAT OUR ELECTED LEADER AS LAW IT TO CONTINUE TO HAPPEN. THE PEOPLE WHO ARE REAPING ALL OF THE BENEFITS OF THE WEALTH THAT WE ARE COLLECTIVELY CREATING ARE THOSE WHO ARE OFTEN PAYING THE LEAST IN TAX AND I THINK THAT IS A REALLY UNFAIR WAY OF GOING ABOUT DOING THINGS.

>> NEED TO KNOW AIRS TONIGHT ON MOST CBS STATIONS.

>> Woodruff: AGAIN, THE MAJOR DEVELOPMENTS OF THE DAY: PRESIDENT OBAMA AND AFGHAN PRESIDENT KARZAI ANNOUNCED U.S. TROOPS IN AFGHANISTAN WILL SHIFT AWAY FROM A COMBAT ROLE THIS SPRING A LITTLE EARLIER THAN SCHEDULED. THE FEDERAL AVIATION ADMINISTRATION LAUNCHED A COMPREHENSIVE REVIEW OF PROBLEMS WITH BOEING'S 787 DREAMLINER. AND THE CENTERS FOR DISEASE CONTROL CONFIRMED THAT THE FLU HAS REACHED EPIDEMIC PROPORTIONS ACROSS THE U.S. IF YOU CALLED IN SICK WITH THE FLU THIS WEEK, YOU ARE NOT ALONE. HARI SREENIVASAN TELLS US ABOUT ONE WAY TO TRACK THIS YEAR'S NASTY STRAIN.

>> Sreenivasan: DID YOU KNOW THAT COUNTING THE NUMBER OF TIMES PEOPLE SEARCH FOR "FLU" ON THE INTERNET IS AN EFFECTIVE INDICATOR OF THE SPREAD OF INFECTION? FIND A GRAPH OF HOW MUCH YOUR STATE HAS BEEN GOOGLING THE FLU. PLUS, WE WANT YOU TO TELL US WHAT YOU THINK OF OUR SCIENCE COVERAGE IN A NEW POLL. FIND BOTH AT "LUNCH IN THE LAB." JEFF BROWN TALKS TO "WASHINGTON POST" FILM CRITIC ANN HORNADAY ABOUT THE SURPRISES AND SHUTOUTS IN THIS YEAR'S OSCAR NOMINATIONS. AND WE PROFILE AN ENTREPRENEUR WHO BUILT A WEB SITE FOR CITIZENS TO REPORT AND GET RESPONSES TO PROBLEMS IN THEIR COMMUNITY. ALL THAT AND MORE IS ON OUR WEB SITE, newshour.pbs.org. JUDY.

>> Woodruff: AND THAT'S THE NEWSHOUR FOR TONIGHT. ON MONDAY, WE'LL LOOK AT THE LIFTING OF TRAVEL RESTRICTIONS FOR CUBANS SOME 50 YEARS AFTER FIDEL CASTRO PUT THEM IN PLACE. I'M JUDY WOODRUFF.

>> Brown: AND I'M JEFFREY BROWN. "WASHINGTON WEEK" CAN BE SEEN LATER THIS EVENING ON MOST PBS STATIONS. WE'LL SEE YOU ONLINE, AND AGAIN HERE MONDAY EVENING. HAVE A NICE WEEKEND. THANKS FOR JOINING US. GOOD NIGHT.

>> MAJOR FUNDING FOR THE PBS NEWSHOUR HAS BEEN PROVIDED BY: ♪ ♪ ♪ ♪ ♪ ♪ MOVING OUR ECONOMY FOR 160 YEARS. BNSF, THE ENGINE THAT CONNECTS US.

>> AND BY THE BILL AND MELINDA GATES FOUNDATION. DEDICATED TO THE IDEA THAT ALL PEOPLE DESERVE THE CHANCE TO LIVE A HEALTHY, PRODUCTIVE LIFE.

>> AND WITH THE ONGOING SUPPORT OF THESE INSTITUTIONS AND FOUNDATIONS. AND...

>> THIS PROGRAM WAS MADE POSSIBLE BY THE CORPORATION FOR PUBLIC BROADCASTING. AND BY CONTRIBUTIONS TO YOUR PBS STATION FROM VIEWERS LIKE YOU. THANK YOU. Captioning sponsored by MacNEIL/LEHRER PRODUCTIONS Captioned by Media Access Group at WGBH access.wgbh.org Captioning sponsored by WPBT

>> THIS IS N.B.R.

>> Tom: GOOD EVENING. I'M TOM HUDSON. IT'S ONE OF THE WORST FLU SEASONS IN A DECADE. HOW ALL THOSE SICK DAYS COULD IMPACT A COMPANY'S BOTTOM LINE AND THE ECONOMY.

>> Susie: I'M SUSIE GHARIB. WELLS FARGO POSTS BETTER THAN EXPECTED EARNINGS. WE REVIEW THE RESULTS AND PRE- VIEW A WAVE OF BIG BANK EARNINGS COMING OUT NEXT WEEK.

>> Tom: AND BOEING'S 787 DREAMLINER UNDERGOES A COMPREHENSIVE SAFETY REVIEW BY FEDERAL REGULATORS AF(oQR SEVERL PROBLEMS SURFACED THIS WEEK. THAT AND MORE TONIGHT ON "N.B.R."

>> Tom: IF YOU ARE SNEEZING ANDç FEVERISH TONIGHT, YOU'RE NOT ALONE. THE FLU HAS OFFICIALLY REACHED EPIDEMIC PROPORTIONS IN THE UNITED STATES. THE CENTERS FOR DISEASE CONTROL AND PREVENTION SAY MORE THAN 7% OF DEATHS LAST WEEK WERE CAUSED BY PNEUMONIA AND THE FLU. IT'S EXPECTED TO BE THE WORST FLU SEASON IN A DECADE. BUT IT'S NOT JUST A PUBLIC HEALTH ISSUE, THERE'S THE POTENTIAL FOR A REAL ECONOMIC