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Newsroom/World View

NEWSROOM For March 28, 2001

Aired March 28, 2001 - 4:30 a.m. ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

ANNOUNCER: Seen in classrooms the world over, this is CNN NEWSROOM.

TOM HAYNES, CNN ANCHOR: Welcome to your Wednesday show. I'm Tom Haynes. And here is what's ahead.

In "Today's News," an escalating energy crisis in California: why bright lights in the Golden State could soon cost a lost more. Then, in "Business Desk": an American industry in the middle of a boom. We'll tell you why the name game is more competitive than ever. From choosing snappy monickers to putting names in lights: "Worldview" checks out an American landmark. Then, in "Chronicle," forget Daytona or Cozumel: We'll check out an alternative to your typical spring break.

We begin in California, where most residents and businesses face a major energy crunch and price hike. California's Public Utilities Commission approved an electricity rate increase for millions of customers who rely on the state's two largest investor-owned utilities: Southern California Edison and Pacific Gas and Electric. The state's biggest energy users may see their bills increase by more than 40 percent.

The upside: The rate hikes won't affect customers who conserve energy. Regulators want to encourage conservation, hoping to head off blackouts this summer. The tiered rate hike will hit the heaviest power users hardest, with up to 46 percent increases, the largest in California's history. This follows approval of two rate hikes, which will have increased rates by up to 26 percent by next year. Southern California Edison and Pacific Gas and Electric have been reeling from high wholesale power costs.

The state's deregulation law, aimed to inject the free market into the power market, prevents them from passing on their increased costs to consumers without first getting approval from the Public Utilities Commission. Last week, California's Independent System Operator, which runs the state's power grid, reported wholesalers had overcharged the state utilities by $5.5 billion during the last 10 months.

California is not alone in feeling the energy pinch. Natural gas accounts for 24 percent of energy used in the United States. More than 60 percent of U.S. homes use natural gas for heating. That demand is expected to grow by 43 percent during the next 15 years. Frank Sesno reports on the nation's energy crunch.

(BEGIN VIDEOTAPE)

FRANK SESNO, CNN WASHINGTON BUREAU CHIEF: Larry Gilbertson is in charge of schools in Alexandria, Virginia. He keeps them working and warm. But soaring energy prices have made his job much harder.

LARRY GILBERTSON, ALEXANDRIA, VIRGINIA SCHOOLS: Our normal budget is $350,000 a year for gas, and this year the price of gas has almost doubled for us.

SESNO: And despite vigorous efforts to conserve...

GILBERTSON: We put energy efficient windows in. We put insulation on our roofs.

SESNO: ... Gilbertson has lost ground. He's got plenty of company this year. Californians cope with rolling blackouts. New Yorkers face dire warnings of electricity disruptions this summer. Home heating prices have doubled, or worse, for those who use natural gas. Prices at the pumps have bounced erratically. The Bush administration says the country is in dire straits.

SPENCER ABRAHAM, ENERGY SECRETARY: America faces a major energy supply crisis over the next two decades.

SESNO: But is it really a crisis? That's certainly what the country endured in the 1970s. The '73 Arab oil embargo tripled the price of oil, causing long lines at the pumps, clobbering the economy, costing half a million jobs. This time, experts say, it's different.

JIM PLACKE, CAMBRIDGE ENERGY ASSOCIATES: It's not a resource crunch.

SESNO: Energy consultant, Jim Placke, has been tutoring the Congress.

PLACKE: It's not that it's not available. It's getting it where it's needed and wanted in a timely way. That isn't always easy to do.

SESNO: Take natural gas, which heats 60 million American homes. Average bills this winter were $1,000, roughly double last year's tab. Prospects for next winter: Some easing, but still about $800. Why the price spikes?

Here's the problem: There are massive gas reserves, but not enough pipelines. For example, as a byproduct of oil drilling, Alaska's Prudhoe Bay yields 8 billion cubic feet a day of natural gas, 13 percent of the country's total daily consumption. But since there are no pipelines there, the gas is pumped right back into the ground.

Take electricity: There's more than enough of it in some parts of the country, Texas and New England, for example. But in California, demand has vastly outpaced construction of new power stations and transmission lines. Outages are becoming routine. In the next 20 years, planners say, electricity demand will jump by 45 percent, requiring more than 1,000 new power plants.

And then there is oil.

PLACKE: The amount of crude reserves is more than twice now what it was 30 years ago, so the world is not running out of oil.

SESNO: But there is a shortage of refineries. There hasn't been a new one built since 1975, and lots of old ones have been shut down. The administration says all this adds up to an energy crisis sweeping the nation.

But many are uncomfortable with talk of a crisis.

PLACKE: There are a lot of things that need to be addressed at the present time. But I think there are answers for them that are within the realm of what is economically manageable.

SESNO: The Bush administration is ringing the alarm bells to get people's attention, but even more, to change the debate to one that embraces new development of the nation's energy resources. Expect a head-on collision with environmentalists and others, who say the priorities and the politics are all wrong. Alaska's oil will be ground zero.

(BEGIN VIDEO CLIP, AUDUBON SOCIETY AD)

NARRATOR: President Bush, don't gamble with America's last great wilderness.

SESNO: Back in Alexandria, Virginia, Larry Gilbertson is merely worried about next year's heating bill for his schools.

GILBERTSON: When you have to find that much money, $200,000, it means that that's approximately four teachers.

SESNO: He's hoping for a mild winter.

Frank Sesno, CNN, Washington.

(END VIDEOTAPE)

HAYNES: One final note: U.S. President Bush vowed Tuesday not to impose price controls on energy, but instead let supply and demand prevail.

While we're on the subject of energy, a quick program note: Coming up next month: CNN NEWSROOM presents "Powering the Planet." We'll bust open the fossil fuel debate and talk about the oil supply and how using it impacts the environment. We'll also look at the innovative ways many Californians are beating the state's energy crunch. Plus, is American's next generation -- you -- hip in the global warming warning? You wouldn't think so by looking in a high school parking lot.

In this week's "Biz Desk": What's in a name? Well, when it comes to a new product or business, a lot. In today's competitive marketplace, new products and services are being introduced to consumers on a daily basis. A product's name can easily lead to its success or failure.

Peter Viles introduces us to a corporate wordsmith whose business is the name game.

(BEGIN VIDEOTAPE)

PETER VILES, CNN CORRESPONDENT (voice-over): When DaimlerChrysler starts selling this vehicle in the United States, it will set some sort of record for size and weight and for having one of the strangest names in auto history. Daimler calls it the Unimog, which translates from German as universal engine-driven apparatus -- which would make for a certain assignment for a naming expert like Dave Placek.

DAVE PLACEK, PRESIDENT, LEXINGTON BRANDING: And I think, for something that large, you'd want something -- probably a smaller word that is flexible and fast, to compensate for the size and probably the sluggishness of the vehicle.

VILES: Placek is a corporate wordsmith. His past hits include Pentium, for Intel; PowerBook, for Apple; and car names such as Outback and Forester, for Subaru.

The problem now in the naming business is that so many words are taken. By one estimate, 98 percent of the words in a typical dictionary have been registered as dot-com domains or trademarks. The result is a glut of fabricated names, such as the Lucent offspring of Avaya and Agere systems, Verizon, Cingular, Agilent, Teligent, and Accenture.

JOHN ELKINS, CHMN. & CEO, FUTUREBRAND: Some of these names are becoming too aspirational. And customers only ever believe the meaning of a name when they see the delivery of the promise behind it.

VILES: Placek is turning back to real words. When Phone.com merged with Software.com, he chose Openwave Systems as the new name. PLACEK: I realize it's a very difficult thing to do, being in this business. When most of them are fabricated, it is difficult for a consumer to begin the conversation with that company, to really even remember the name.

VILES (on camera): Now DaimlerChrysler says it's going to stick with that name Unimog for that big truck it's bringing to the United States. Certainly not a catchy name, but it does have a history -- in Germany, there's some farmers who have been fans of the Unimog for 50 years now.

Peter Viles, CNN Financial News, New York.

(END VIDEOTAPE)

HAYNES: In "Biz Desk Extra" today: The United States Supreme Court begins examining how copyright law applies to new technology which reproduce articles written for other media. For instance, should writers get credit when their work which was published in a newspaper or magazine gets copied to a computer database?

Charles Bierbauer has more

(BEGIN VIDEOTAPE)

JONATHAN TASINI, FREELANCE WRITER: The Copyright Act does not allow...

CHARLES BIERBAUER, CNN CORRESPONDENT (voice-over): Jonathan Tasini is a freelance writer. He's usually eager to sell articles to "The New York Times." But Tasini is not pleased when "The Times" allows those articles to be reproduced on its Web site or in databases, such as Lexis-Nexis, without his direct permission.

TASINI: We want our work out there. We simply want to have our permission asked and to get paid a fair amount.

BIERBAUER: The media, including TIME Inc., owned by AOL Time Warner, the parent of CNN, argue electronic versions are simply revisions of the original publication, for which the freelance writers have already been paid.

LAWRENCE TRIBE, ATTORNEY FOR "NEW YORK TIMES": The issue is whether it should be possible for these individual authors, who have been benefiting from the wide distribution that the electronic media make possible for their works, to say: You know, come to think of it, there's a pot of gold there and we would like part of it.

BIERBAUER: In the past, newspapers were reproduced for libraries on microfilm. New technologies, the Internet and CD-ROM were just a flicker on the electronic horizon when Congress passed the Copyright Act in 1976.

(on camera): Journalists and authors now have many more venues for their work. For example, I'm reporting the Supreme Court case not only on CNN's television networks, but on CNN Radio and on CNN.com.

(voice-over): For freelancers, the electronic rights are a big deal.

TASINI: It affects all freelance authors. And I use the word authors broadly: photographers, graphic designers and illustrators and writers.

BIERBAUER: But historians and researchers fear archives will be depleted if publishers feel they could be sued by anyone who's ever written a freelance article.

TRIBE: The net result would be that everyone who wants to find their articles online, or find them on a CD-ROM, or access them electronically, will find a gaping black hole.

BIERBAUER: The justices, occasionally freelance writers themselves, will decide by summer. Their opinion will be on the Supreme Court Web site.

Charles Bierbauer, CNN, the Supreme Court.

(END VIDEOTAPE)

(BEGIN VIDEOTAPE)

ANNOUNCER: A CNN viewer wants to know: What is the status of dot-coms in the U.S. and how many have shut down?

ALLISON TOM, CNN INTERACTIVE CORRESPONDENT: Industry experts say that it really depends on who you ask. But they say, overall, the mentality is that the gold rush is over. Some dot-coms are, of course, surviving, but others are facing difficulties. The bottom line that a lot of experts will say is that businesses, no matter what, whether they're a dot-com company or a traditional company, they need to be run with a solid, sound business model.

Now, there are a few resources on the Internet that might show you how many dot-coms have failed or shut down. And we're going to take you to those. The first one is TheStandard.com. They have a flop tracker on their Web site. And it follows dot-com companies and ones that have shut down.

Another site that we're going to take you to is HooversOnline.com. They are a business network. They have a "Dot-Com Deathwatch" list where they track companies that have gone under.

And last but not least, there's Upside.com. And this is a high- tech news site. They have a "Dot-Com Graveyard." Here you can find out daily updates as to which companies have actually failed, which ones are going to possibly fail, the ones that are not quite dead yet. But those are the ones that they have listed there.

And, again, you can get all these updates on these Web sites.

(END VIDEOTAPE)

HAYNES: In "Worldview": business and politics. Get set for the bright lights of the Big Apple, as we head to the United States. We will take you to Times Square: past and present.

Before we do, we touch down in Jordan, site of an Arab summit this week -- one important issue being discussed: the peace process between Israel and the Palestinians. King Abdullah II of Jordan, the summit host, called Tuesday for Arab support in the Palestinian uprising. The 10-year-old sanctions against Iraq are also center stage at the gathering. And Kofi Annan became the first United Nations Secretary-General to address an Arab summit.

Meantime, health issues are in the spotlight in the United Kingdom. British authorities are investigating reports that contaminated meat from Asia served in a Chinese restaurant in England with the waste then fed to pigs may have been the source of the foot- and-mouth epidemic.

As Mike Chinoy reports from Hong Kong, the disease is no stranger to Asia.

(BEGIN VIDEOTAPE)

MIKE CHINOY, CNN CORRESPONDENT (voice-over): Foot-and-mouth disease has been common in Asia for years. Since the mid-1990s, there have been outbreaks in Hong Kong, Taiwan, China, the Philippines, Vietnam, Japan, South Korea, Malaysia and Mongolia.

In all cases, experts say the strain of the virus was Type O, the same one reportedly identified in infected livestock in Britain, raising the possibility that contaminated meat from Asia triggered the current European outbreak.

WALLACE LAM, HONG KONG UNIVERSITY: This is very likely because the virus has been typed as a Type O virus and which was found mainly in Asia. So -- and the virus can persist in meat product for a very long time. So I think it's quite possible.

CHINOY: It's too early to be sure. And Type O is also found in the Middle East. But many Asian nations long ago learned to live with the disease. The method: vaccination, which helps keep the number of cases down, and sharp curbs on the export of livestock products.

LAM: In endemic countries, they need to use vaccines to protect their animals, and according to the rules set by the international organization, animals from vaccinated countries cannot export their meat or animal to the countries that are disease free, and the countries that do not use vaccines.

CHINOY: But European farmers rely on international trade for much of their livelihood and so have not vaccinated their animals.

(on camera): The result: millions of head of livestock vulnerable to infection if, as now seems possible, they were exposed to foot-and-mouth through contaminated meat products from a part of the world where the disease is still endemic.

Mike Chinoy, CNN, Hong Kong.

(END VIDEOTAPE)

HAYNES: In "Worldview" today, we revisit New York, the largest U.S. city and the country's trade center. It's also the financial capital of the world. Last week, we went to Harlem to explore its renaissance and its rebirth. Today, we head to Times Square.

Times Square is the famous intersection formed by Broadway, 7th Avenue and 42nd Street. It's its own theme park, although it has changed with economies and politics. In Times Square, the night is illuminated and the day is transformed, its ordinary state into something dazzling and special.

Sasha Salama has the story of a company that has literally lit up the crossroads of America for over a century now.

(BEGIN VIDEOTAPE) SASHA SALAMA, CNN CORRESPONDENT (voice-over): New York's most mythic destination, Times Square, delivers equal parts grit and glamour, tradition, and departure, mega-scale advertising, and a rushing river of information.

TAMA STARR, CEO, ARTKRAFT STRAUSS: There are really two Times Squares, the one that's made out of bricks and mortar and steel. And then there's the one that exists in people's minds.

SALAMA: The artistic hand that helped create both throughout the 20th century is a family-owned sign maker called Artkraft Strauss.

STARR: Artkraft Strauss has been building displays in Times Square since the gaslight era when horse carts ran on Broadway.

SALAMA: Tama Starr is third-generation CEO and heir to the business, which is still innovative and independent.

STARR: The first time anybody ever tried that was 1909.

SALAMA: The legend began at the turn of the century when Starr's grandfather Jacob, a Russian immigrant, became the first to illuminate a sign. He was later nicknamed the "Lamplighter of Broadway."

STARR: He was an inventor, an electrician, and a metal worker. He built the first electric sign in Russia. And when he came here to the Square, it was wide open for development of big displays.

We built mechanical signs, the first electrical signs in the very early days. We built the first neon sign in Times Square.

SALAMA: Over the decades, Jacob Starr transformed mere advertising into a tourist destination, signs hand forged with mechanical parts and automation, and tens of thousands of lights were called spectaculars. The flash and dazzle created by Artkraft Strauss became the signature of Times Square.

GEORGE PLIMPTON, AUTHOR-EDITOR: It is probably the most famous square in the world. It's not for architectural reasons. It's not because it's beautiful. It's not because it's ancient. It's not because it has a history. Here, this confluence of avenues, it really isn't a square, it's famous for neon light bulbs, nothing more really.

STARR: It's a funny thing about these big signs. They're actually made of wire and glass and metal. But they embody a dream. Your name in lights on Broadway is an integral part of the American dream.

SALAMA: The characters on the signs became emblematic of their time.

BRUCE WEINDRUCH, CEO, THE HISTORY FACTORY: Little Lulu had become, for Kimberly-Clark, an important icon during the second World War, when she was trying to tell people to conserve. She became so popular that by the end of the war and when Times Square boomed again, her sign became a very important event. SALAMA: Many people still remember this sign.

STARR: Everybody's favorite sign is the smoking camel sign. People think they've seen it who cannot possibly have seen it because the sign came down in 1964.

PLIMPTON: You know, I learned to blow a smoke ring really because of looking at the mouth of that man in the Camel ad who blew out these perfect oily smoke rings out over Times Square.

STARR: There were others that were equally spectacular or more. The Bond waterfall, a block-wide waterfall 50 feet tall with two 70- foot statues of a man and woman at either end. It had 500,000 gallons of water with glycerin to keep it from freezing.

SALAMA: And for 88 years, from 1907 to 1995, Artkraft Strauss was at the heart of the granddaddy of Times Square traditions, the New Year's Eve ball in Times Square. By the time Tama Starr graduated college in the '60s, she told her grandfather she wanted in.

STARR: I said, "Grandpa, could I come and work in the company?" He said, "Absolutely not. It is no place for a lady."

SALAMA: Old Jacob would be surprised to see his granddaughter today 10 stories off the ground checking out firsthand why a welding project is taking so long.

STARR: Nobody could foresee that I would be the chief honcho here. I certainly couldn't imagine it.

SALAMA: After spending 12 years farming and writing music in Hawaii, Tama returned to New York. Her father Mel Starr, who had been running the company for 10 years, soon became ill. By 1988, Tama Starr took over. Under her creative supervision, Artkraft Strauss has kept its inventive culture.

STARR: Coca-Cola is the world's smartest sign. It even has its own phone number so it can call us up if something goes wrong.

It's got three sets of anemometers so if the wind gets too high, the thing shuts itself off and telephones us and tells us about it.

We needed over three millions LEDs to build it. So we were able to fourth the developments of the second generation of LEDs in order to create this.

SALAMA: Despite its state-of-the-art signs, Artkraft Strauss is dwarfed by its competitors, most of whom have been gobbled up by Infinity Systems, a national billboard company owned by Infinity Broadcasting.

But Starr's cozy company is thriving by sticking to its New York niche, offering one-of-a-kind spectaculars from concept to construction to installation.

STARR: The powerful of survival should not be underestimated. It's wonderful to be 104 years old. And it does give a certain momentum, especially if one keeps ones eyes firmly fixed on the future, because the past is wonderful, but it's over.

Whatever the display type is, and probably it's an LED or that new device that we saw, this would be an ideal use for that.

SALAMA: Adding fresh management ideas and new technology to the century-old company has increased profits 650 percent in the past five years even when revenue has remained steady at $15 million to $20 million annually.

But for Starr and her company, there's a payoff greater than money.

STARR: That everybody feels personally involved. Everybody who works here, no matter what department they're in, when they go past one of our creations, they say, "I made that."

So there's always a puzzle. There's always a challenge. There's always something that makes us grow and become smarter. And we love that, all of us.

SALAMA: For "BUSINESS UNUSUAL," I'm Sasha Salama, CNN Financial News.

(END VIDEOTAPE)

HAYNES: It's that time a year again, when many college students go on spring break. Vacations and beach parties are popular times during the week following exams, but some students have a few different destinations in mind.

Here's CNN Student Bureau Reporter Kristine Harrington with more.

(BEGIN VIDEOTAPE)

KRISTINE HARRINGTON, CNN STUDENT BUREAU REPORTER (voice-over): The typical spring break scene: tan, buffed bodies in swimsuits, the hot sun, loud music and parties. But many students find alternatives to this week-long party. Thousands of college students use their spring break to serve Habitat for Humanity affiliates worldwide. The work is rewarding.

JENNICA HUFF, HABITAT FOR HUMANITY: Instead of going and partying and just laying on a beach someplace, they really want to work and use their spring break to serve others.

HARRINGTON (on camera): But national organizations like Habitat for Humanity aren't the only ones hammering out alternative spring breaks.

(voice-over): The Navajo Nation trip allows for students to explore, learn and interact with different cultures. They help rejuvenate the reservation, while another trip to Death Valley helps rejuvenate the environment. ANGELA PAN, VOLUNTEER COORDINATOR: Basically, it's an environmental conservation trip. We take up to 18 students out into the desert. And we camp all week. And we help out the rangers out there, doing some various projects to help the environment.

HARRINGTON: But while some students choose to build and volunteer domestically, others opt for a foreign mission.

JAMIE CUMMMINGS, VOLUNTEER: We want to go down there and say: OK, we're going to put up this house, and we're going to make everything better.

And, like, that would be a band-aid, you know. But, really, what we're going down there to do is to learn and just to see and to know what's going on.

HARRINGTON: And there's a lot going on in this footage from Bel Air Presbyterian Church. They invite people of all different faiths for the USC or UCLA spring break Mexico City mission. So while some students still opt for the traditional beach, beer and babes, others search for something more.

CHRIS WOLFE, BEL AIR PRESBYTERIAN: There's a certain pride you feel when you help someone. And it's -- and that can be very, like, memorable and touching. But I think it's -- a lot of times, it's just befriending them, befriending people that you'd never have -- would meet otherwise. And it's like -- and seeing the effect you have on their lives is just -- I don't know, it gets you. And it's cool.

HARRINGTON: In Los Angeles, I'm Kristine Harrington.

(END VIDEOTAPE)

HAYNES: All right, good for them.

That's CNN NEWSROOM for Wednesday. Thanks for joining us. And we'll see you back here tomorrow. Take care.

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