[Kiran Chetry, Cnn Anchor:] Good morning to you. It is Thursday, November 11th. I'm Kiran Chetry.
[Ali Velshi, Cnn Anchor:] Good morning, Kiran.
[Chetry:] Good to see you.
[Velshi:] And good to be back here. I'm Ali Velshi. John has the morning off. Here are the morning's top stories. What to cut, Social Security, taxes, thousands of federal jobs, and that is just the tip of the iceberg. We are breaking down the dramatic action proposed to slash trillions of dollars from the U.S. deficit.
[Chetry:] The controversial alcoholic energy drink we've been hearing a lot about lately, Four Loko, there are new restrictions this morning. Four states now banning the so-called blackout in a can. It comes after a group of college students got sick from a night of binge drinking. And there are other states who want to put voluntary bans in place at liquor stores.
[Velshi:] And it looks like the White House is backing down on their position on Bush era tax cuts. The president's top advisers suggesting that the administration is now ready to support and across the board extension of those tax cuts set to expire at the end of this year even for the wealthiest Americans. Late breaking details from Dan Lothian who's traveling with the president in South Korea.
[Chetry:] First, though, a lot of people made it clear in this election, one of the things they are really concerned about was government spending, the rising deficit and debts. The question this morning is what would you cut? Well, President Obama's bipartisan commission is out with their list.
[Velshi:] Right. It was supposed to be out December 1st, but they leaked it themselves. And it's not pretty. Here are some of the proposals that touch you and every other American. First, gradually raising the retirement age from 67 to 69. Two years. On taxes, eliminating or scaling back some of the most popular write-offs, including the mortgage interest deduction. The United States is the only developed country that offers this mortgage interest deduction. And the tax increases would be offset by replacing the current tax rates with just three tax rates eight, 14, and 23 at the federal level. It's pretty tough medicine for the American economy and it came with a dire warning.
[Erskine Bowles,  Co-chair, Deficit Commission:] We're clearly on an unsustainable path. We can't grow our way out of this problem. We can't tax our way out of it. We can't cut our way out of it. Every single member of Congress knows that the path we're on today is not sustainable and that if we don't bring the deficits down and eventually get the balance, we are headed for disaster.
[Velshi:] Clearly, this is something that you care about. In our national exit polls taken last Election Day, last Tuesday, 39 percent of Americans who voted say the highest priority for the next Congress is to reduce the deficit. That was followed very closely by people who think the government should actually be spending to create jobs. Cutting taxes was only 19 percent of the population despite of the fact that everybody says everyone wants to cut taxes. Apparently, most people are concerned with cutting the deficit.
[Chetry:] Let's bring in Christine Romans right now to talk more about this. This is a dramatic proposal. And it is just a proposal. How this shakes out in Congress is the story. But highlight some of the changes.
[Christine Romans, Cnn Business Correspondent:] There are a lot of changes. We're talking about cutting a third of the overseas military bases, cutting military personnel. We're talking about freezing spending on the federal level. You're talking about cutting thousands of federal workers. You're talking overall a huge impact. Everyone would feel this. This, I want to be clear, this is the story of our time. And it's just beginning and these are just proposals, but this is how it all starts. What's the problem? The backdrop here is $14 trillion of national debt. This is a number that is going up with no end in sight. This commission is tasked by trying to figure ought how to stop the rise of red ink. We are spending vastly more as a country than we are taking in. The recession made it worse, but it had already been started before that. And many people on both sides of the aisle think that something has to be done. And all the solutions are dramatic. And this is just a grouping of all of them. Again, $4 trillion over the next decade is what they're hoping to cut in deficits to slow the ascent of the national debt. But already the knives are out. Look, not everyone's going to be happy. From the beginning, we knew no matter what this commission was going to do or say there would be people who would not like the solutions. Among them, House Speaker Nancy Pelosi who says it's simply unacceptable. Senator Dick Durbin, "There are things in there that I hate like the devil hates holy water." The things in there that many progressive and liberals don't like is even talking about in touching Social Security the program in terms of balancing our budget and our debt. Republicans are opposed to raising taxes. They do not want to see taxes go up. In this proposal it was actually a set of proposals. It's not even the final proposal from this body. But in this proposal, there are simplified tax rules. But also getting rid of a lot of deductions, $1 trillion in deductions, folks, that frankly, Americans and businesses are addicted to.
[Chetry:] Right. Being able to write up your mortgage interest, that's a huge incentive to buy a home as opposed to rent.
[Velshi:] We're told that incentive wasn't necessarily the best for our economy over the last couple decades. No other country offers that and lots of other countries have the same ownership rates as the
[U.s. Romans:] And one of the proposals in here is actually just cutting the mortgage income tax deduction for loans over $500,000 for second homes and the like.
[Velshi:] So less expensive homes you could still get.
[Romans:] There's something about controlling health care, paying doctors less. Not paying for health care. There's a lot in there.
[Velshi:] Is issue different from than 911 commission where it was all hoopla and blue ribbon everything, and then ultimately it just got brushed under the door?
[Romans:] You hope it's a starting point now that horse trading begins behind closed door. There are 18 people on this commission, and 14 of them have to agree on the proposal to give Congress. A lot of people are thinking maybe this gives the president and Congress political cover.
[Velshi:] Right, saying here's a whole bunch of smart people who came together.
[Romans:] When you look at yesterday, pictures in the U.K. of the students raiding the conservative headquarters and the burning in the streets in France. I'm telling you, this is the story of our lifetime now how we're going to pay for what we've already spent and get things simplified and get them to make sense again.
[Chetry:] The president said before anybody goes commenting, gather the facts.
[Velshi:] The full report is December 1st. Let's understand it. Let's all study it.
[Romans:] These would also phase in. It wouldn't happen right now. If you're generation y, you're the one seeing the big differences in your retirement age. Someone who is a senior right now, nothing is changing for you. Let's make sure the fear-mongering doesn't start on that, that somebody is trying to cut your benefits. This is all phased in, long-term stuff, but things that have to be discussed.
[Chetry:] Christine, thank you.
[Velshi:] "Blackout in a can," that's the nickname. It's been blocked out of Washington state. The liquor control board banned the alcoholic energy drink yesterday after a group of college students got sick from drinking too much Four Loko. That's what it's called. It goes into effect November 18th. Oklahoma, Utah and Michigan have similar measures. The manufacturer says its product has been targeted unfairly.
[Chetry:] People are joking that Google has a lesson for its employees, don't tell the world how well we treat you or you'll be fired. Apparently one person missing out on this 10 percent raise and other goodies is the person who leaked that word of that raise to the media.
[Velshi:] That does puzzle me. The federal government is paying out more and more six-figure salaries. "USA Today" reports the number of federal workers earning $150,000 orders more has jumped to ten times the level it was at just five years ago. The revelation comes as Republican congressman call for a pay freeze or pay cut for federal employees.
[Chetry:] Odds are that there are a couple of students in your kids' class that have ADHD or perhaps your child does as well. The CDC says that nearly one in every ten children is being diagnosed with attention deficit hyperactivity disorder. It's not clear if the increase is actually to a rise or actual awareness. Two-thirds of the children diagnosed with the disorder are on medication to control it.
[Velshi:] And it looks like Senator Lisa Murkowski's edge is growing in Alaska. The incumbent is battling Tea Party Republican Joe Miller as a write-in candidate. The count could last into the weekend. Apparently Miller trails write-in ballots by about 11,000 votes.
[Chetry:] Well, they're almost home. This morning, passengers on board Carnival's Splendor say they can see the coastline, a welcome sight after being stranded. Five tugboats are towing that ship to shore. A fire in the ships engine room Monday caused it to lose power. CNN producer Paul Vercammen is filing the latest developments for us.
[Paul Vercammen, Cnn Producer:] Executives for Carnival Cruise line say their disabled cruise ship Splendor will be pulled by tugboats into San Diego harbor at some time around midday. That's on Thursday. Carnival also promising the passengers on board the ship that they will get full refunds. They'll be put up in hotels if need to. Some have been shuttled to Long Beach where many parked and many will be flown out of San Diego. In the meantime the USS Ronald Reagan played a big role helping out at sea. That vessel is back on maneuvers today. But as you can imagine, after airlifting some 60 pallets of food, supplies, water, and the rest on to the Carnival cruise ship, this was quite a different mission for many of those pilots who have been supporting U.S. troops in places like Iraq and Afghanistan.
[Commander Tamara Graham, Navy Helicopter Pilot:] It's very rewarding. What we do, obviously, there's goods and bads when you're in the middle of warfare and doing your job. But this is all an upside. We're helping out people that are in distress. It's an opportunity, actually, to improve the lives of a lot of folks that were in dire straits. So it's a great opportunity.
[Vercammen:] The aircraft carrier pilots dropped some 60 pallets of water, food, and other supplies on to the carnival ship. Who's going to pay for all of this? Carnival is going to pick up the cost of supplies while the U.S. Navy is going to pay for the fuel, the aircraft and the rest. Paul Vercammen, CNN, Coronado, California.
[Velshi:] And it's 10 minutes after the hour. So much for if you snooze you lose. A new study suggests that night owls have higher IQs than people who get up early. I really would have guessed otherwise. I would think that early risers are hard workers and they are ahead of things. And night owls are people who party a little bit too much. The fact is we offend no one if we talk about how this is wrong that morning people are smarter than night owls because night owls aren't watching us.
[Chetry:] Exactly, they're still snoozing. The news is if you are an early bird, you tend to be more reliable than night owls. You also work harder and get better grades. We both took this quiz and we sort of came up in the middle.
[Velshi:] We both were in the middle. We were separated in the middle. We're both neither night owls or morning. Don't you think when you do this job, you should squarely be in the early morning category?
[Chetry:] Yes.
[Velshi:] The buzz is building. Prince William and Kate
[Chetry:] We love to watch implosions, but this one was botched. The smokestack fell in the wrong direction during that demolition, sending people running for their lives. We're going to have more on how it all turned out. It's 12 minutes after the hour.