a new week and new shake-up for the battle for the presidential nomination. newt gingrich is now the solid front runner in the state of iowa. but today his focus was on new york. and a meeting with donald trump. let's go to new york. there's jim acosta following this for us. what's the latest with newt gingrich the front-runner and donald trump? >> well, he is in the big apple and you can say he is singing new york, new york, start spreading the newts. he his message he is can win the republican nomination. he is willing to take this battle to all 50 states. at a news conference in new york, newt gingrich insisted he can go toe to toe with mitt romney in a 50-state battle for the nomination. even with a much smaller operation. >> we have all these articles about how businesses are getting leaner. how they are flattening their hierarchies. doing all sorts of things. have you people who work from home. you have virtual organizations. all of these cutting edge ideas. you have a group who have to be slow cumbersome and expensive. >> the donald has had the number one show in the country. okay? he is a genuine american icon in miss own right. why wouldn't you want to come and hang out with him. >> part of the plan included a visit from donald trump who had enough meetings to host a presidential apresent iis reality show. >> but beginning rich has a new ad drawing comparisons to reagan's iconic morning in america spot. but the message is eerily similar it yes, we can. >> yes, work together. we can and will rebuild the america we love. >> team obama is sitting up and taking notice with grinning rich surging to the top of the poll. >> i think a lot of people in inside the beltway and outside the beltway woke up today, to a very different political environment and one in which newt gingrich is very much for real. >> democrats seem all too eager to face gingrich in an interview with the blog talking pint point memo, nancy pelosi, dredging up the investigations into the former speaker's leadership into the 1990s. i know a lot of about him, pelosi said. i served on the investigative committee that investigated him. four of us locked into n a room for year. a thousand pages of this stuff. >> i want to thank speaker pelosi for what i regard as an early christmas gift. >> beginning rich responded that the house should reputate her comments, using the office to damage his candidacy. >> we don't always see eye to eye, do we newt? >> no. >> the sign the two former speakers aren't as chummy as their days battling climate change in this ad. >> and gingrich went on to say that during those investigations into the house of his leadership, that he was basically cleared of nearly all of the charges, just one wolf, that he said he was found to be in violation of in the meantime, newt gingrich is also in search of campaign cash here in new york, given the fact he is going to be potentially fighting with mitt romney across the country for this gop nomination, he will need more than just good poll numbers to come out on top. >> if the republicans nominate someone he doesn't looin like, and he is not defining who that might be, he is still holding out, albeit, a tiny percentage. he is still holding o out will possibility that after the season ends in may on his show on nbc, he could run as third party candidate. did he elaborate at all following his meeting with newt gingrich on that? >> he didn't. he basically said his next order of business is to hold this debit on december 27. as you know, he is set to moderate a debate among the gop contenders. some of those contenders, jon huntsman and ron paul said they aren't going. newt gingrich rsvb yes. that probably doesn't hurt too badly in terms of getting an encoarsement from trump. in addition to his reality tv show, the donald is coming out with a book this week. needless to say, and who am i to accuse the dond al of this, but there also might be self promotion going on. just a thought. >> just a thought. we will speak to him later on this week. herman cain is walking way from the presidential race amid allegations of sexual misconduct. but he is leaf leaving with a huge amount of cash. what will he do, now that he suspended his race for the white house wp what does he do with the money he raised? >> as you mentioned, he has suspended his presidential campaign. but in one way, he is still acting like a candidate. he is still fund-raising. he even has a something scheduled tonight in oklahoma. the cain campaign train has come to a stop but he is still rolling in the political donation answers if he gets his way will still be a fixture on the public stage. >> i'm not going to be silenced and i'm not going to away. >> he launched cain solutions.com, a website up but without content. but thing he does have is plenty of cash. cain raised about $14 million in campaign contributions. 9 million of that since october 1. even now, he is fill fund-raising. >> the before his announcement about putting his campaign on suspension, he sent out a very aggressive fund-raising e-mail to his supporters saying, make a generous donation to my campaign so you can show your support. >> cain suspended his campaign as opposed to dropping out of race. what's the difference? money. federal law allowes a candidate who is you suspends a campaign to continue raising funds. he could convert his campaign dmeest a pack and use that to throw list weight behind political candidates. >> he has a lot of freedom to use the funds for political purposes in terms of making contributiones it candidates or political parties or engage in his own political independent speech. >> he couldn't use the funds for blatant personal use but could tap into the money to pay for travel, lodging, web sites and consultants. >> this candidate cannot use the money for personal use. they can't pay themselves a salary. they can't just transfer the money to their own bank account. they can, however, spend the in such a way that it does benefit them economically or in terms of reputation because they have set up a charity and they can-ksh that reflects well on them. >> and cain does have other options with his campaign money. he could return the money to contributor or give money to charity. judging by the fact he is still out there by the political arena, still fund-raising, it is likely we will see a cain pack in the weeks ahead. >> do we know how much cash on hand? >> he has 14 million. he has about $630 million in debt. >> 600 thousand? >> exactly, sorry tp. thanks for qualifying that. he is actually flush with cash so he can doing well. >> he could hold on to that until he creates a pack. there is no time limit. >> that is another possibility. he could run for another political office down the road. >> and use that money, run for governor or senator. >> exactly. >> as he said, he is not going away. he has big plans. he has this website up. >> he wouldn't be the first politician to raise the money and kept it for years to come, using it for political purposes. good report, lisa sylvester. let's go to jack, he has the cafferty file. >> hello, wolf. the day before he drops out of campaign, he is appealing for money. go figure. in a lincoln/douglas style debate, real politics told the human events in the red state they locked down a date on december 19 and place to hold the debate. he says gingrich was toward go but romney turned them down. romney could benefit from the two-person format where the toughest opponent instead of debate format where candidates have no chance of winning are all included. and it could be a good practice for a debate against president obama if romney ends up being a nominee. which is appearing to be less likely everyday. why won't romney agree to debate gingrich? critics say he is simply running out the clock. gingrich will have a debate partner on the 19th. huntsman accepted the invitation while taking a swipe at romney. the substantive format makes it hard for romney to hide from his record. that's a quote. romney could be making a big mistake while refusing to talk to the media and refusing to debate gingrich. the coronation appears to be slipping way. gingrich sits atop the polls as well as those in key early voting states. in iowa a brand new poll shows romney in third place. behind gingrich number one, ron paul number two. and in new hampshire, another poll shows "the gary radnich show" has climbed almost 20 points against romney since october. meanwhile there are reports that cain may endorse gingrich. if if he does, it could be bad news for romney. what does it say about mitt romney that he won't debate newt gingrich one on one? go to cnn.com/caffertyfile. or post on wolf blitzer's facebook page. >> you remember my hometown team, the bills, and he became a sportscaster, he talks about sitting on preventing on defense. he would say the same thing and he was right. he says preventing defense prevents you from winning. if romney continues a prevent defense, you know what will happen? >> it just doesn't make any sense. remember, who is the fellow from time magazine you had on last week? talked about how much more accessible romney was, you can't get to him any more. he has this bunker mentality, figuring it is all his for the taking, but i'm not sure so sure it is. >> if you want to be president of the united states, you have to go out there and fight, fight, fight. >> and you owe the voters an explanation. you owe them where you stand on the issues. you should be out there explaining to people, here is what i think about this, this and this. here is how i will attack the problems. you can't trust they will vote for you on good faith. not today. >> check out my blog on the situation room web page. aej remember 9-9-9 plan? >> yes, i do. >> it's not dead, dead, dead. >> a pizza topping. >> it's not dead, dead, dead. >> okay. >> check it out. >> thanks very much. the president is using his bully pulpit to step up pressure on republicans to extend the payroll tax cut. he tries to turn the tables on them when it comes to raising taxes. also, head of the faa arrested for drunken driving. we're learning new details. stand by, you're in "the situation room." the droid razr by motorola. the first droid that becomes self-aware. it remembers what you do and does it faster. create shortcuts like automatically syncing while you sleep. instinctively shape-shifting from a music stream for your workout to newsfeed during breakfast, then a gps for your morning commute. powered by verizon 4g lte, this droid is too powerful to fall into the wrong hands. forty years ago, he wasn't worried about retirement. he'd yet to hear of mutual funds, iras, or annuities. back then, he had something more important to do. he wasn't focused on his future but fortunately, somebody else was. at usaa we provide retirement solutions for our military, veterans and their families. from investments... to life insurance... to health care options. learn more with our free usaa retirement guide. call 877-242-usaa. 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[ cheering ] i wanna see that again. ♪ let's go to the white house. our chief correspondent is standing by. the president was in the briefing room a few hours ago, making his case, tell our viewers who he said. >> hi, wolf, the president's message is that congress has to use its remaining days before its break it extend the payroll tax cut that basically if republicans block it, it is inconsistent, he says, with their pledge ton raise taxes. here's the president. >> i know many republicans have sworn an oath never to raise taxes as long as they live. how could it be that the only time there is catch is when it comes to raising taxes on middle class families? >> the wolf, the president's aides believe this is a winning issue for the president because if congress doesn't extend the payroll tax cut, then taxes on middle class families go up and the president has a campaign issue and if congress does extend this payroll tax cut then the president has a win, a policy win, on his hands and he can take credit for it. the bottom line is, folks here expect that congress will pass this. at this point, it is just a question of how it will be paid for or if it will be paid for, wolf. >> tomorrow, as you know, jessica, the president heads it kansas. kansas to deliver what the house says will be a big speech. he is trying to draw comparisons with teddy roosevelt. what is this about? >> well, he is going to address issues like income and equality and a lost themes that have been very frustratinging to the progressive wing of the dem krtic base recently, he will be talking about -- well, issues that the progressive wing of the democratic base framed as sort of the 1% versus the 99%. instead of talking about it in terms of the big banks versus everybody else, you will hear the president talk about fairness and making sure that working americans get a fair shake. these themes balance, fairness, were big themes for teddy roosevelt when he gave his square deal speech and he gave that square deal speech in the very same town more than a hundred years ago in kansas. wolf? >> jessica, thanks very much. the man who oversee s was arrested for drunk driving. randy babbitt has taken a leave of absence from his job. what do we know about this? >> wolf, police say this happened on saturday night at about 10:30 if fairfax, washington, not far from washington. faa administrator randy babbitt pulled over for allegedly driving on the wrong side of the road. police say he was driving alone. no crash or injuries reported in this incident. he was charged with driving while intoxicated and released on personal rekog any suns, which means in bail money was required. the department of transportation said officials there learned of the arrest, quote, in the last hour. that of course would be just afternoon today, about 36 hours after the arrest occurs. the white house also didn't find out until today after about noon time. so far babbitt has been given a leave of absence and his deputy will fill in. we called babbitt's house and went there to speak to him. we were not able to speak it randy babbitt. he oversees safety rules for pilots, planes and flights, that includes regulation on pilot intoxication. he was appointed to a five-year term by president obama in 2009, and he is vet ral ran pilot himself. he flew for eastern airlines for about 25 years, wolf. >> any indication whether or not the president will ask him to resign? >> white house press secretary jay carney said babbitt is on a leave of absence. beyond that he is said to ask the department of transportation. the only thing that they say is that he is discussions with legal council about will discussion of babbitt's status. >> appreciate it. a check of the day's other top stories then newt gingrich versus nancy belossesy. she says she's got dirt on gingrich that he is firing right back at her. the two former speakers are battling. that's coming up in "the situation room." ♪ medicine that can't wait legal briefs there by eight, that's logistics. ♪ ♪ freight for you, box for me box that keeps you healthy, that's logistics. ♪ ♪ saving time, cutting stress, when you use ups that's logistics. ♪ this was the gulf's best tourism season in years. all because so many people wanted to visit us... in louisiana. they came to see us in florida... nice try, they came to hang out with us in alabama... once folks heard mississippi had the welcome sign out, they couldn't wait to get here. this year was great but next year's gonna be even better. and anyone who knows the gulf knows that winter is primetime fun time. the sun's out and the water's beautiful. you can go deep sea fishing for amberjack, grouper and mackerel. our golf courses are open. our bed and breakfast have special rates. and migrating waterfowl from all over make this a bird watcher's paradise. so if you missed it earlier this year, come on down. if you've already been here come on back... to mississippi... florida... louisiana... alabama. the gulf's america's get-a-way spot no matter where you go. so come on down and help make 2012 an even better year for tourism on the gulf. brought to you by bp and all of us who call the gulf home. thingses mount. pakistan gets a boost from the military base. lisa silvestylvester is monitor that. clats what's going on? >> dip plattic officials confirm that u.s. is leaving the air base at the request of the pakistani government. the order comes after an airstrike last month that killed 24 pakistani soldiers, worsening already strain red lagss between the two countries. under an expired deadline and the threat of more sanctions, syria agreed to let arab league observers into monitor the unrest with conditions. the regional organization must drop sanction immediately and it also wants suspension from the regional group rescinded. the arab league says it'll consider syria's proposal before making final decision. word today that workers from fukushima daiichi found a leak of radio active water. tepco says there is a slightly elevated level of active material in the area. it said they are trying to figure out how much tainted water may have reached the ocean. sandbags stopped the leak. a powerful earthquake and tsunami damaged the plant in march. wolf? >> thanks very much for that, lisa. newt gingrich is out with his first paid television commercial. it is trying to be inspirational. but does it succeed? also, nancy pelosi is hinting she knows secrets about newt gingrich. we will talk about all of this in our strategy session. donna brazile and mary matalin are standing by live. of your baby acting adorable. baby. on it. matt, ignore me and keep updating your fantasy team. huh? jeff, play a game. turbo-boosting now, sir. dennis, check in everywhere you go on foursquare. that's mayor dennis... of the water cooler. you're the best. liz, rock out to pandora. oh, no i'm an only child. and nick, you shouldn't even be here, you can do everything from the golf course. good? good. 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