good evening. tonight, we are live from jacqu jacksonville, florida. site of the cnn republican debate, which is just an hour away. the race between mitt romney and newt gingrich is really tied here. it's a big night. and issue number one for voters here, the housing crisis. no doubt florida residents felt the sting of this headline today. sales down 2.2% in december. may surprise you. no, and florida is one of the worst hit states in the country when it comes to housing. one in every 360 homes in this state received a foreclosure notice last month and almost half of mortgages are under water. you look at orlando, down 60%. they have fallen by more than half and miami and in tampa. in most cases, where there's a housing problem, there is an unemployment problem. and no place more so than here in florida. construction drives everything here and the jobless rate is at 9.9%, well above the national average of 8.5%. all of this playing out in the campaign here. romney and gingrich attacking each other for profit frg the crisis. >> while florida families lost everything in the housing crisis, newt gingrich cashed in. he was paid over $1.6 million by the agency that helped to create the crisis. >> this guy owns freddie mac and fannie mae stock. this guy owns gold man stax. this guy's surrounded by lobbyists and he's running an ad? >> stewart miller is the ceo of one of the largest homebuilders in the united states, the le nar corporation in miami. his company has a major presence here, california and nevada. those are the top three states hit hard by the crisis. and he's on our out front strike team, a group of entrepreneurs and investors we check in with regularly. thank you so much for coming here. i know you're based in miami. coming up here to jacksonville. we get the data today. the part of the reason we saw the pain in the housing market. is it over? is it going to start to improve? you're in a state where the average home is down 50% in price. >> you've recited a lot of the bad data. what we're starting to see in the field out in our communities, not only in florida, but across the country is we're starting to see a fundamental recovery. fundamentally strong and driven by free market focus and what we're starting to see the stabilization that we think ultimately leads to recovery. and the fund mamentals driving are the fact that home price iss are low. interest rates are low and rental rates are starting to move up. so the comparison between the two is favorable for force out housing. demand is just sarting to come back. >> and we've had some federal programs to help here. let me just play a sound bite from mitt romney back in october. what he had to say. here he is. >> don't try and stop the foreclosure process. let it run its course and hit the bottom, allow investors to buy homes, put renters in them, fix up the homes and let it come up. >> so, mitt romney saying don't stop the foreclosure process. let it go ahead. a lot of people said at the least, not understanding of the pain regular people have gone through. is it your view we're going to see prices go up? >> i think the most important thing is we start to see stabilization because prices have been cascading downward for a long time. stabilization is what we're starting to see in our markets as far as mitt romney's statement, we clearly have to see the past foreclosures, defaults, make their way through the marketplace and ultimately, we need to clear the inventory out there. whether it's by letting foreclosures take place or turning some of these loans into rental homes, we need to get that inventory off the market. >> the question is, do we need more help? your industry was -- you wanted help. you guys were lobbying, wanted help. but do you need more from the government or have you had enough? do we need another program from the president or need to hear another program from a gop candidate? >> i think the most important is to let market forces work and do no harm. but that means we've got low interest rates, but people aren't able to take advantage of it. we have to enable them to get appraisals that matter and mortgage approvals. right now, the pendulum has swung too far. we can't take fannie, freddie, fha out of the market at the time we may need them the most. >> obviously, this has become a center of a lot of the figing we're seeing between newt gingrich and mitt romney. newt gingrich oh, well, you were paid by fannie and freddie and that has become a shorthand for you were a bad guy. are they bad? >> fannie and freddie, whether they're good or bad, they're an integral part of our housing system right now. >> can't shoot them down. >> because you take demand out of the system when we need it most. most importantly, if we believe we've got to get the government out of financing, let's do it on a transitional basis. slowly, methodically and only when we have a private mortgage market ready to take the helm in a wake of a government walk way wa. >> rick santorum was just arriving. the candidates are arriving over the next few minutes to get the final preparations. final question here in florida, we talk about 350,000 construction jobs lost in the state since the peak. it's a state that relies on property tax. the state's running a deficit. governor wants to cut another close to 7,000 jobs i believe. are you going to start to sea that improve? are you going to start to see hiring at all in construction in florida over the next six months? might be the most important question if barack obama wins the state. >> it's not just about florida, it's the whole country. if we want the economy to stabilize, we're going to have to see housing come back, stabilize and recover. remember, pricing in housing drives consumer confidence and building in housing drives jobs. not just in florida, but across the country. watch for housing recovery and we'll see stabilization. >> and your bottom line, we are starting to see it. >> as long as we don't pull the rug out from under. >> we'll bring in john avlon, interesting, john, more optimistic than most would expect especially when you look at the drops in this state. >> absolutely and that's good news for the state, for the country. if it continues, it could be good for the president. but here's the short-term problem. saying things have hit their bottom doesn't give people a lot of confidence when they're feeling the pain and frustration. yes, the state saw its rate go from 5% in january 2008 to 12% in the summer of 2010. the people who feel under water, who have taken loans out, got frustration and has that voter anger. >> mitt romney is arriving now. sounds like what you're sag is there is no magic bullet, that administration got it wrong -- to fix quickly. >> as we see here, at the end of the day, we've gotten into a downward spiral in housing that has been freed. in order for us to get back to stabilization and recovery, it's going to take time and take a while before we start to feel good. let's be patient and let the free market forces correct themselves and let's not do anything to -- >> maybe in the fall. the question now, especially about this primary, the relentless negative attack ads all centering on fannie and freddie. but not offering solutions. we're at the attack ad stage. only stokes the fire and frustration people feel. >> thanks so much. great to see you. and please go to our website and check out the team. president obama did win florida in 2008. so, four years later, how is this swing state going to go? and watching tv in florida today, it's really, really negative place to watch television. super pacs doing a lot of vile things. and those great airline deals you see advertised are usually a bunch of you know, a bunch of bs. we're going to explain. ♪ [ male announcer ] you never know when a moment might turn into something more. and when it does men with erectile dysfunction can be more confident in their ability to be ready with cialis for daily use. cialis for daily use is a clinically proven low-dose tablet you take every day, so you can be ready anytime the moment's right. ♪ [ man ] tell your doctor about all your medical conditions and medications and ask if your heart is healthy enough for sexual activity. don't take cialis if you take nitrates for chest pain as this may cause an unsafe drop in blood pressure. 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[ male announcer ] ask your doctor if cialis for daily use is right for you. for a 30-tablet free trial offer, go to cialis.com. the fight for florida reaches a boiling point. an exciting night to be here in jacksonville with a lot of excited and involved college students behind us. president obama though knows how important this state is to his re-election. the first lady in tampa, sayre sew ta and palm beach today. the average has been 2.6 percentage points. florida is not a sure win for anyone. take a look at the latest polls. the president and mitt romney in a dead heat in florida. both with 45% of the likely vote. compared to newt gingrich, the president holds a 50 to 39% lead. who's going to walk away with a florida win? let's bring in james and ari. james, let me start with you, sir. florida high unemployment. we just heard largest homebuilder in the state. we're starting to see a recovery. that could mean jobs, which could be great for the president. what does the president do to win this state? >> it's a very, very competitive state as ari can attest to and the margin has been razor thin here as of late. he needs to be moving in the right direction. if he does that, i honestly believe only events can beat president obama. i don't think romney can. we're still sus eptable to a double dip or something happening. >> would you agree? 50 to 41% think mitt romney would do a better job handling the economy, but there is this fact that housing may be bottoming. that might be more important than anything else. >> in american politics, the most important factor is the economy going into an election year. if the economy shows signs of improve on a sustained basis, it's going to be a huge advantage for president obama. it's also a debt that no matter what happens to the economy, in my judgment, the next president's going to have to do the real things to tackle the debt and that's where i think the president's going to be in trouble no matter how the economy is going. >> the debt is an important issue. latin latinos, 30% are registered democrats. can republicans win latino voters? >> the most important thing to say is not what's your ethnicity, but what can we do to help you. that's growth, values, foreign policy. i don't know that people necessarily slice themselves up. i'm not looking for a hungarian candidate. >> had some problems over there in vienna. >> hungary. >> buddha and pest. >> but it's -- the interesting factor for republicans is they've got to show an inclusive side. if republicans give a signal they only care about older white voters, it's going to be harmful to the party and its future. >> in an interview on wednesday, the president was asked whether mitt romney on newt gingrich would be a tougher opponent. listen to how he answered the question. >> i don't really think about that. what i can say is this. whoever their nominee is, they represent ideas that i think are wrong for america. >> well -- i think he does think about it. i know i think about it and i'm not running for re-election. mitt romney's position on immigration is just an out -- way out there. ari fleischer always had a very good immigration policy. bush probably didn't endorse romney because he wanted 13 million people to come back. it's about idiotic is what it is. he doesn't mention it in florida, but they're going to mention it all over the country when he's running a general election. "the washington post" front page did a great story today on super pacs. it was a million dollars spent in this state in this primary by democratic super pacs against mitt romney. they want to take the guy out. they don't want to run against him. how else do you interpret that? >> no question. the democrats are having a lot of fun right now. especially james. >> james has been laughing a lot more than usual. >> when it comes to the money, both sides are going to have plenty. democrats will have a lot. republicans will have a lot. remember, it was campaign finance reform that gave us this situation. not citizens united the court case. parties. democrat and republican who used to spend the money and have biggest say. now, it's gone out to the individuals. >> what's going to happen, we're supposed to get soon a report from the super pacs, but they have that loophole. >> january 31st. >> just a general loophole. the little charitable a.r.m., you don't have to is close donors. >> if you're giving money used for the purpose of running a political ad, they're going to be disclosed. if they're going something for charity, you have very different type of ads going on. so, we'll see. but again, the point is, there's a sheldon on the right, a george soros on the left. >> james, can you tell me what really goes on at the white house? yeah, go ahead. >> i just think this money in politics is just awful. and i think people give money to politicians because they do make money off government. that's not every instance. there's some well motivated people. i think the connection between money and politics is corrosive and it's getting worse. we'll agree to disagree on that one. >> the other side, unions are going to be able to give almost unlimited, spend unlimited. whatever the super pacs give is going to be a penitence. >> go ahead. final word, james. >> we need a lot of things in this country. one we don't is more money in politic. but you know, we'll have to -- at some point, we'll have to look at that. but it's not going to happen soon. >> all right. thanks to both of you. i got to admit on that one, i got to go with james. kill the super pacs. >> break for a commercial. >> break for a commercial. newt gingrich calls out what he calls the elite liberal media, but some of the harshest criticism comes from his own party and there's a number of things you're paying too much for. we'll tell you what and why and it goes to money and politics here in the state of florida. i wouldn't do that. pay the check? no, i wouldn't use that single miles credit card. hey, aren't you... shhh. i'm researching a role. today's special... the capital one venture card. you earn double miles on every purchase. impressive. chalk is a lost medium. if you're not earning double miles... you're settling for half. was that really necessary? [ male announcer ] get the venture card at capitalone.com and earn double miles on every purchase every day. what's in your wallet? cover for me. i have an audition. what's in your wallet? i've tried it. but nothing helped me beat my back pain. then i tried salonpas. it's powerful relief that works at the site of pain and lasts up to 12 hours. salonpas. the sleep number bed. with the sleep number bed, it's not about soft or firm. it's about support where you find it most comfortable. the magic of this bed is that you're sleeping on something that conforms to your individual shape. on a traditional mattress, there is no adjustment. you get what you're buying that day. with our bed, you change the setting to something you like. this way, if you change your mind once you get home you can adjust it. wow! that feels really good. it's hugging my body. you can adjust it to whatever your needs are. your body changes over time. the bed can adapt with you. not only does it work for you today, but it's going to work for you 20 years from now. so whatever you feel like, the sleep number bed's going to provide it for you. and now, the company that redefined sleep is redefining memory foam. save $400 on our all-new memory foam bed - the only bed that combines cool, contouring gel foam with sleep number adjustability. and stock up and save on our exclusive bedding collection at our white sale. only at the sleep number store, where queen mattresses start at just $699. all right. you are looking at a picture of newt gingrich just arriving tonight for the cnn presidential debate here in jacksonville at the university of north florida. he is with his wife, callista. mitt romney is here. rick santorum is here. we'll continue to watch as the candidates come in, get their makeup on. the brothers, alfie, pep pi and an address operate a business in the dominican republic. they're the guys behind domino, cnh and red pack. life with these sugar barons is pretty darn sweet. they are the largest landowners in the dominican republic, a nation of about 9.5 million people. here in florida, the family owns 155,000 acres in palm beach county alone, which brings us to tonight's number. 4.5 billion. that is the dollar amount that big sugar costs american consumers every year. according to mark perry, professor at the university of michigan, by pushing for trade policies, sugar producers have forced americans to pay 53.3 cents a pound for sugar in america. that is double a average world price and it means that you feel it every time you buy a reeces pieces, a coke, or cookies. they also have a taste for politics. over the past few decades, the family has donated to federal, state and local campaigns. they gave george w. bush and earlier this month, co-hosted an event for romney. that would be a heck of a lot of chocolate bars. all right. we're going to take a brief break. we're 30 minutes away from cnn's republican debate. what do the candidates need to do to win over florida's voters? we're here in a college campus. the passion for ron paul is audible and you hear it. ron paul revolution. rand paul describes -- now, we have got the video. we'll be back. 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