Return to Transcripts main page
CNN Talkback Live
Aviation World Shocked by Allegedly Drunk Pilots; Aniston Sues Over Topless Photos; WordCom CEO Speaks Out
Aired July 02, 2002 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ARTHEL NEVILLE, HOST: Hello everybody. Welcome to TALKBACK LIVE. I'm Arthel Neville. WorldCom CEO John Sidgmore will face reporters this hour when he addresses the National Press Club. We'll find out how he explains the telecom giant's $3.8 billion accounting scandal. We'll check in to see how well he holds up.
And I want you to check in with me. Give me a call at 1-800-310- 4CNN or e-mail talkback@cnn.com. Now here's what we're talking about today.
Flying under the influence. Two America West pilots fail a breathalyzer after their plane is ordered back to the gate.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: I would never show up to work that way. Our lives are in the hands of those people, they don't care.
(END VIDEO CLIP)
NEVILLE: Also lies, cover-ups and creative accounting. Has your faith in corporate America been shattered along with your retirement fund? What do you think should happen to corporate officers who cook the books?
And Jennifer Aniston doesn't want anyone to sneak a peak.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: It's your backyard. You can dress however you like. If someone takes a picture of you and then publishes it, that does seem like a right to privacy violation.
(END VIDEO CLIP)
NEVILLE: Can a celebrity who courts publicity sue when she gets too much?
OK, let's start with those two America West pilots who are probably wondering today if they'll be changing careers. Captain Thomas Cloyd and First Officer Christopher Hughes are charged with operating an aircraft under the influence. The two men were caught by screeners at Miami International Airport, and CNN national correspondent Susan Candiotti is covering this story.
And Susan, walk us through this, if you will. So what, Cloyd and Hughes tried to get through a security checkpoint with coffee and then what happened?
SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: But for that cup of coffee, Arthel, you might say, apparently they tried to walk through with a couple of cups of steaming hot coffee and one of the screeners said, can't do that, rules against opened containers. According to the police, the pilots became argumentative about it, and so that's when the screener called in a supervisor.
Both of them, according to police, smelled alcohol on the breath of the two pilots, the pilot and co-pilot, and they also describe them as having bloodshot eyes and flushed faces. Well, at that point, they called in another supervisor who in turn called police. By the time police got down to the gate, the plane had taxied away from the gate and was already out on the taxiway.
So police quickly notified federal agents, the tower. The tower called the plane back to the gate, and then the passengers sat there for over an hour as the police boarded the plane, asked the two pilots to voluntarily submit to breathalyzer tests, and by the way, we understand from police that the co-pilot explained, "It's merely mouthwash" -- that's a direct quote.
Well, again, they voluntarily took this breathalyzer test. They failed what's called a roadside sobriety test as well, and both, the pilot and copilot, flunked. They were just over the legal limit, which is .08 in Florida. At that point they were arrested.
NEVILLE: Right, Susan, because Cloyd's blood alcohol level was .091 and Hughes was.084, and as you said, the legal limit in Florida is .08. I was wondering, was this their first offense?
CANDIOTTI: According to America West both pilots had a clean record. The captain in the case had been with that particular company for about a dozen years, and the co-pilot for about four years, and so America West emphasizes that at this time the two pilots are suspended with pay.
The airline will conduct its own investigation. If they confirm the results of this breathalyzer test, the airline says those pilots will be fired, that the airline has a policy of zero-tolerance.
NEVILLE: OK, Susan, thank you very much for that update. OK, with us now are Tom Monaghan, a pilot and publisher of AviationCareer.net magazine, and George Graves, a former Air Force pilot and a retired attorney with the Aviation Bar. He is the national legal officer of the Civil Air Patrol, and I'd like to welcome both of you gentlemen.
UNIDENTIFIED MALE: Good afternoon.
UNIDENTIFIED MALE: Thank you.
NEVILLE: OK, great. Tom, you know what? I'm going to start with you.
TOM MONAGHAN, AVIATIONCAREER.NET: OK.
NEVILLE: And if you could tell us what are the rules regarding alcohol, and do they -- do they vary from airline to airline?
MONAGHAN: Well, they do. The FAA has their regulations, which are basically, twofold, eight hours between "bottle and throttle" is sort of what you learn when you come up through the ranks and they also have a limit, a physical limit of .04. Airlines often though, have their own drug and alcohol policy, and with many things to do with the FAA, they sometimes, have a policy stricter than the limit set by the FAA themselves.
NEVILLE: So if you're saying 8 hours that means that perhaps you could have a glass of wine or so with dinner the night before.
MONAGHAN: Basically eight hours, .04. Those are the hard and fast rules, although I understand with America West their policy may have been 12 hours and zero. So, you have to look at each individual airline, and what policy that's set for their employees.
NEVILLE: And Mr. Graves, I'm going to get to you in a second, but I want you to clarify for...
UNIDENTIFIED MALE: Yes.
NEVILLE: ... me, Tom, what is this -- you said .04 -- what did you say?
MONAGHAN: Yes, that is an FAA. The .08 that was referred to earlier...
NEVILLE: That's Florida.
MONAGHAN: ... by Susan is Florida for operating a motor vehicle. Very rarely do you hear an A319 airbus being described as a motor vehicle...
NEVILLE: Right.
MONAGHAN: ... but that's the case in Florida.
NEVILLE: But a .04, I'm just trying to get an idea -- do you have any idea of what that means, like what would get my -- it varies, of course, according to your age, and et cetera, weight, but I was just wondering if there was some sort of margin that we could gauge what .04 would get.
MONAGHAN: No...
(CROSSTALK)
MONAGHAN: ... like cough syrup or something like that...
NEVILLE: I see. MONAGHAN: ... would give you some kind of reading. You have natural alcohol in your system. I don't -- I'm not really an expert on that.
NEVILLE: Now Mr. Graves, I'm not sure if you can answer this, but do know what happens if the rules are broken?
GEORGE GRAVES, AVIATION ATTORNEY: Well, it depends on which rule, which authority, and they all have separate and different penalties. The penalty for an airline is you're fired. The penalty for FAA, the worst it can get, you lose your license. So you're out of flying as a career.
NEVILLE: So there's a possibility that if these two gentlemen in question here, Cloyd and Hughes, they could possibly lose their license. You know this fly is bugging me, sir. I don't know what he's trying to get on TALKBACK -- excuse me, OK. I'm not responsible for this. Just go ahead and shoo it away.
GRAVES: That's a TALKBACK LIVE fly.
NEVILLE: You know it's bothering me. Anyway, I'm sorry. It was distracting me. Go ahead, sir.
GRAVES: All I'm saying is that's in addition to any criminal penalties, which are also possible. So when you're talking about the airline you work for, you can lose your job. You can lose your license.
NEVILLE: OK, now are we talking about a widespread problem here? I mean certainly we as passengers, we don't need to have to worry about looking at the pilots when we board the plane, right?
GRAVES: Well my feeling is to these two pilots it's a widespread problem. It's their entire career. However, in law, where I practice, you look at it and you say, percentages mean nothing to anybody but the lawyer. In other words, if 80 percent are going to be so and so, well the...
NEVILLE: Right.
GRAVES: ... lawyer can count on that, but the individual it's 100 percent if they're in the other 20...
NEVILLE: Right. Right. I understand those numbers. I'm going to with Tom, though, and ask the same question, just ask you Tom. Do you know if this is a widespread problem?
MONAGHAN: No, actually they started drug and alcohol testing across the board in 1995, and actually they reduced it in 1998. In 1995, 25 percent of your employees had to be -- go through random testing in a year. In 1998, I believe, they reduced that to 10 percent because what they found in their testing was, and this is all safety, what they call safety-sensitive people, which includes...
NEVILLE: And... MONAGHAN: ... dispatch, maintenance, everything else.
NEVILLE: But when you're talking about random testing, what are you talking about?
MONAGHAN: Now you have to do 10 percent of your employees, and what they -- what they found was the average, I think, in 1997, was .06. so six-tenths of one percent came back with any kind of positive results at all.
NEVILLE: So was that a breathalyzer we're talking about these random tests?
MONAGHAN: Yes, or it could be a blood alcohol.
NEVILLE: Well you know what, I have a question -- hold -- don't answer it yet, but I'm wondering, you know, what do you think about this, too, Juan (ph)? Should pilots be required to take breathalyzer tests before every flight?
UNIDENTIFIED MALE: That's overkill. I think they just need to realize that they have a tremendous responsibility and consequently, there should be zero-tolerance. If the rule with their company is eight hours, adhere to it. If the rule is 12 hours, adhere to it, and I think it's just a common sense responsibility factor.
NEVILLE: Well what do you think? I want to know what you think because you can go online right now and vote at CNN.com/talkback, and I'll give you the results a little bit later in the show.
Also later this hour, Jennifer Aniston is in court today, and CNN has learned a settlement has been reached in her case. We'll bring you the details later this hour. We'll be right back. Get online and vote, vote, vote, vote, vote.
(COMMERCIAL BREAK)
NEVILLE: And welcome back, everybody. I'm Arthel Neville. We're talking about pilots who drink on the job, and I promised Andy (ph) from Canada that I would let you go ahead and jump in -- go ahead, Andy (ph).
UNIDENTIFIED MALE: Yes, hi, Arthel. You're lovely as always. Anyways my point is I think that screener deserves a presidential award, and a medal. I mean it brings to light the problem or problem drinking, and I'm a victim of a drunk driver myself. I had a brand-new motorcycle that I and my bike was run over with, and I'm left with a permanent brain injury.
NEVILLE: Well I'm glad you're here with us, though, still.
UNIDENTIFIED MALE: I hung in...
NEVILLE: Yes.
UNIDENTIFIED MALE: ... but as I said, it just underscores the problem of drunk driving all across the board.
NEVILLE: Absolutely.
UNIDENTIFIED MALE: Thank you very much.
NEVILLE: No, thank you for calling in. Thank you. And actually, before I get to you sir, I want to go on record, too, saying that the screener should be commended because we were talking about screeners yesterday and how there's problems at the airport and it's like anything, you can't paint any categorize or you can't categorize any group of people with a broad brush.
You know what I mean? You can't stereotype and say that all the screeners are bad, or all the pilots are drinking on the job. We're not saying that, right, sir?
GRAVES: That is correct. But also Miami received the, one of the best ratings for...
NEVILLE: Screeners.
GRAVES: ... screeners of any in the country. So...
NEVILLE: They're on the ball in Miami.
GRAVES: ... if there was going to be a chance there, that's probably where you get the job done.
NEVILLE: All right. What's your name, West (ph)?
UNIDENTIFIED MALE: Yes, how are you doing? My question and my thought was just that maybe we should require the airlines, they want to go with guns in the cockpits and go with bulletproof doors. How about just blowing everybody a breathalyzer before each flight?
I mean we want to do frequent flyer miles and all these other things to encourage flying, and I think safety has to be first. So let's try -- (UNINTELLIGIBLE) we're going to make an error (ph), let us be on the side of safety rather than anything else.
NEVILLE: Thank you sir. Tom, should each pilot be given a breathalyzer before each flight?
MONAGHAN: No, I think -- I think random testing and the fact that you're going to really blow your whole career over this. You know, these guys could have stopped -- two or three times they could have stopped, called crew scheduling and said hey, I can't go.
And they might have been in a little bit of trouble, but you know, they basically would still have their licenses and they'd still be able to go fly for a living. And the -- you know they're basically both in their early 40s, I believe...
NEVILLE: Yes.
MONAGHAN: ... so they gave up 20 years of a career that they loved for a few drinks, and I think just that threat and these examples every once in a while are enough to discourage and make everybody aware of the importance of accepting the responsibility that they have.
NEVILLE: Right, but clarify something for me Tom, because I read that it's not so easy for pilots to call in sick or call in tired.
MONAGHAN: Well, if you're going to give up your whole career over it, I think you call in, and I -- you know, maybe they called in and say they were both sick as dogs. They could have called in and just said the truth.
NEVILLE: I know, but what I'm saying is I read that it's not just that easy, that sometimes these airlines don't take too kindly to that, and sometimes these pilots are actually forced to continue flying even if they say listen, I'm tired.
MONAGHAN: I just don't find that to be the case. I, you know, I think if they called in, they would be in trouble, there's no doubt about it.
NEVILLE: Trouble, why?
MONAGHAN: For missing the flight and showing the lack of responsibility that they're supposed to have towards that flight, but nevertheless they wouldn't have lost their license. I mean the thing, where they go over the line is when they walk on that plane and turn it on. That's the -- that's the place. Any time up before then, they could have stopped and said look, we made a mistake last night...
NEVILLE: Right.
MONAGHAN: ... we were out too late. We were this. We were that. And you know -- you know, like any employer they're going to come down on you and say, give you a little grief, maybe suspend you for a few weeks without pay...
NEVILLE: Right.
MONAGHAN: .. but nevertheless you have walked out of there still with a career intact.
NEVILLE: All right, I'm going to -- I'm standing here -- Thank you, Tom, for that answer. Max (ph) here from Florida, I wanted to ask you, do you think that a breathalyzer test before each flight is a good idea?
UNIDENTIFIED MALE: Well, I think we should make the tests random because we're going to spend a lot -- too much money in government funding if we just go out and test every single pilot before every single flight. There's tens of thousands of flights a day, and if we just test everyone all the time, it's going to cost too much money.
NEVILLE: Yes, but you got a lot of lives at stake there.
UNIDENTIFIED MALE: In this case, I mean it could have been just as bad as the crew of the Exxon Valdez not seeing the State of Alaska floating up ahead of them. This could have been a major disaster, but thank God it wasn't. And I just think if the federal government, the FAA, and the NTSB come in, and randomly test people and adopt a zero- tolerance policy, hopefully this will just be a thing of the past and a lesson that we've learned from.
NEVILLE: All right, Max (ph), thank you very much. And Nancy (ph) is calling in from -- where are you calling from, Nancy (ph)?
UNIDENTIFIED FEMALE: I am in Arizona.
NEVILLE: Hey.
UNIDENTIFIED FEMALE: And I'm about to pick my daughter up this afternoon, coming in on a America West flight, and I just wanted to say that I am disappointed and I do hope that they do everything possible to punish these pilots and hold them up as an example, that we aren't going to tolerate our pilots being drunk in this day and age of everybody's so paranoid about flying. We don't need to have drunk pilots. I'm sorry, that's just unacceptable in any circumstance.
NEVILLE: Yes, and that flight from Miami was on the way to Phoenix...
UNIDENTIFIED FEMALE: Right.
NEVILLE: ... the one that we are talking about.
UNIDENTIFIED FEMALE: Right, well America West is the hometown airline of Phoenix and we all trust it. We all fly it. It's, you know, it's a great airline, but this is just unacceptable.
NEVILLE: So Nancy (ph), you're on the way to the airport now?
UNIDENTIFIED FEMALE: In a couple of hours, my daughter just called and said she's on the -- on the way to the airport herself.
NEVILLE: OK.
UNIDENTIFIED FEMALE: She's in San Francisco.
NEVILLE: OK. Well we want your daughter to get home safely.
UNIDENTIFIED FEMALE: I do too.
NEVILLE: Thank you for...
UNIDENTIFIED FEMALE: Thank you Arthel and I love TALKBACK LIVE.
NEVILLE: Thank you. OK, Tom, we were discussing this earlier, wondering if the pilot and crew protect each other, if somebody did have a glass of wine inside of the eight or 12-hour limit. You know, maybe the other person won't say anything.
MONAGHAN: Well, actually, you know, and I won't say that that is not a problem or could never happen, but at the same time, the punishment gets out for people that know about it and should have stopped it as well as those that went ahead and committed the act in the first place. You know the whole thing of a crew is to be responsible and to protect the overall flight and passengers.
So you have a responsibility if you see one of your fellow crewmembers inebriated where you don't think they can perform their duties, you need to take action yourself or you'll be just as culpable as the person that made the mistake in the first place.
NEVILLE: George Graves, do you think we can depend on that?
GRAVES: Yes, I think you'll find that among the crew, the flying crew, the pilots, know each other pretty well, but sometimes the rest of the crew and the pilots don't even come from the same domicile, that is the same base, so they don't really know each other very well. So...
NEVILLE: They wouldn't cover up for each other, is what you're saying.
GRAVES: They don't even know each other...
NEVILLE: Right.
GRAVES: ... that well.
NEVILLE: Right. OK, well listen, this is definitely an interesting topic. Tom Monaghan and George Graves, thank you both for joining us here on TALKBACK LIVE.
MONAGHAN: Thank you Arthel.
NEVILLE: OK.
GRAVES: Thanks for having us.
NEVILLE: Oh, good. We have to take a break right now, but up next, stocks are in the dumper, taking with them countless retirement plans and pensions. Corporations are caught lying about profits. The president is outraged. The SEC is enraged, and the CEO of WorldCom is about to face the Washington Press Corps. This should be good. It's all going to be live, and we're talking about it all right after this.
(COMMERCIAL BREAK)
Welcome back, everybody. "Friends" star Jennifer Aniston says it is nobody's business how she sunbathes in her own backyard. So, when topless pictures of the actress showed up in "Celebrity Skin" and "High Society" magazines, Jennifer took the publishers to court.
CNN producer Matt Carey is covering the case in court and has details of a newly reached settled and Matt joins us now on the phone. Matt, what's going on?
MATT CAREY, CNN PRODUCER: Hi Arthel. How are you?
NEVILLE: I'm good.
CAREY: Well, the case was settled and as you might expect both the judge and the attorneys involved said that the terms of the settlement are confidential. So they're not really saying exactly how much money the magazine may pay Jennifer Aniston or whether they will be allowed to publish these photos ever again. They're simply being absolutely mum on that.
But the attorneys did say that Jennifer is happy and that all sides are pleased with the settlement. She was in court today with her husband, Brad Pitt, who's faced similar kinds of situations himself with rather revealing photos published of him. So she did have the support of her husband there today.
NEVILLE: You know what? And good for her, because this woman was in her own backyard. She can do whatever she wants to do on her own property. And so I ask you, Matt, do you have any idea, though, if this is going to affect other cases, perhaps pending cases, and maybe the paparazzi will say or soccarazi (ph), as they're calling it, will say you know we're going too far. We're...
CAREY: I think -- I would say it's very unlikely to do that. The reason is that these kind of pictures sell a lot of magazines and even if, a company like Men's World Publications have to settle, let's say hypothetically, for millions of dollars, they may well have made that kind of money and more by publishing them in the first place. So...
NEVILLE: Wow. So you're saying so what, we're going to make -- the publishing companies may think well we're going to make the money anyway, and so whatever we're going to pay the celebrity in terms of a settlement is a fraction of our profit anyway.
CAREY: I think that's very likely, because these kind of suits happen all of the time and it obviously hasn't stopped publications in the past from going ahead and pursuing these kind of photographs taken on private property in many cases.
NEVILLE: Well, that's really too bad. I have Jenny (ph) here in the audience who has to say something about this.
UNIDENTIFIED FEMALE: Well, I think you know being a famous actress like Jennifer Aniston, I think it goes with the territory that the press is going to be interested in what she's doing at all times, but if it comes to this level where she's in her...
NEVILLE: She's in her yard.
UNIDENTIFIED FEMALE: ... sunbathing nude, you know, she has every right to do that to come up and sue whoever it is who's trying to...
NEVILLE: I say, Jennifer, you sue the pants off of them. Ha, ha, how's that? Good for her.
CAREY: Well... NEVILLE: Yes, what did you say, Matt?
CAREY: Basically that -- basically that was the point that the publisher of "Celebrity Skin" was making is that they view her as a public person, who is not entitled to the same kind of rights...
NEVILLE: But she was in her yard. She's not...
(CROSSTALK)
NEVILLE: ... she's not...
(CROSSTALK)
NEVILLE: ... she's not property. She's not public property.
CAREY: Well, that's what her attorneys are saying, and they did manage to work it out today.
NEVILLE: OK, Matt, listen, thank you very much for that update, and we're going to take a break right now. But WorldCom CEO John Sidgmore is about to go before reporters at the National Press Club. We'll take that live right after this break.
TALKBACK LIVE continues in a moment.
(COMMERCIAL BREAK)
NEVILLE: And members of Congress are stripping themselves of WorldCom campaign contributions. They're sending that money to charity as fast as they can in order to distance themselves from a growing corporate scandal that frankly stinks and right now we're going to hear from WorldCom CEO John Sidgmore to see what he has to say about all of this.
UNIDENTIFIED MALE: ... John Sidgmore, WorldCom's president and Chief Executive Officer, who will be here to provide comments to you. We will take questions. John will take questions after he makes his comments. We have set up microphones on either side here. And we ask that you use them for your questions.
NEVILLE: ... Sidgmore to get to the podium.
But, in the meantime, I want this gentleman Mitch to stand up here in the audience. Mitch is from Virginia, happens to be a former WorldCom employee, who took the severance package Friday.
MITCH: Yes, that's correct.
NEVILLE: What do you need to hear from John Sidgmore to make you feel better?
MITCH: Well, I think he needs to take responsibility for the company and the future of the company. I know he was sort of handed the reins a couple weeks ago. And I think the best that he can do now for the company is just take responsibility and try and move forward with it.
NEVILLE: So, you left the...
I am going to talk to you after the break. We are going to hear from Mr. Sidgmore right now. Stand by for me, Mitch.
OK, let's listen in.
(INTERRUPTED FOR LIVE EVENT)
NEVILLE: OK, we have been listening to John Sidgmore, WorldCom CEO.
And here to talk about this: Terry Savage, the personal finance columnist for "The Chicago Sun-Times," and author of "The Savage Truth on Money"; also with us, Andy Serwer, editor at large for "Fortune" magazine.
And I want to welcome both of you to the show.
ANDY SERWER, EDITOR AT LARGE, "FORTUNE": Hey, Arthel.
NEVILLE: Before we start with you, I want to talk to Mitch, one of the 17,000 people laid off Friday.
Hearing those words, what are your thoughts?
MITCH: Well, it seems like he was trying to be forthright and trying to be open and trying to make up, make amends for the past problems that they've had. And I guess that is all he can really do right now, is be as forthright as he can and try and be honest with the shareholders and everyone else who looks to WorldCom to -- who had some sort of stake in them.
NEVILLE: But, Mitch, as a person who is now sitting here without a job -- sure, you got a severance package where, what, you're going to paid for eight more weeks -- it doesn't really help you.
MITCH: Yes, that's certainly right.
But, in his position, he can only do the best that he can right now. And it certainly would have been nice a couple of years ago if they were a little more forthright. But, from his position, that's the only thing he can do right now.
NEVILLE: OK, thanks, Mitch.
Andy Serwer, I want to hear your thoughts now.
SERWER: Well, interesting, Arthel.
First of all, the man apologized. To me, I think that is one of the first times I have heard one of these executives caught up in one of these accounting scandals do that. That was refreshing. Then he talked a little bit about how important the company is to the economy. That is undeniable. It is such a big player, particularly in the Internet, never mind MCI. Then he talked a little bit about the steps he wanted to take.
You know, John Sidgmore is known for being a straight shooter. He's kind of an outsider within the company, because he is with UUNET, a separate part of the company in Northern Virginia. So, he is sort of the perfect kind of guy to bring in.
I think he did a pretty good job as far as it goes. It remains to be seen. Interesting how he went into all that detail about how he found out about the improprieties, very unusual for an executive to do that. And I think, as Mitch is suggesting, he was really trying to show another level of candor, which is, again, different.
NEVILLE: And, Terry, still, we have a lot of the people with retirement moneys tied up in the stock market. And the stock market is not looking so good these days. What do you say to these people?
TERRY SAVAGE, AUTHOR, "THE SAVAGE TRUTH ON MONEY": Well, I think, just to go back a little bit, I think it was a very impressive performance, because here, we are finally going to be able to differentiate between the wrongdoers, who probably will be found in court to be the CFO and some other people in that department, and the company itself, which is a vital part of the economy.
And so, as you see someone losing a job there, and many, many thousands more losing jobs because of this and other accounting scandals, you realize that, No. 1, shaking the confidence in the financial markets is a terrible thing, not just for that stock, but for real people with jobs. And then, of course, as the stock market loses, people lose confidence. You don't get the gains that people counted on to build their retirement accounts.
So, this has far-reaching effects in terms of jobs and retirement accounts. But, at least this time, maybe we will go after the individuals that perpetrated the fraud, rather than destroying the company, which is basically what the government did in the Andersen case and hurt so much more.
NEVILLE: So, then, having said that, with hope towards the future, then perhaps people who have moneys again in 401(k) plans, with lots of stock options, etcetera, and facing this bear market right now, you are saying to them, what? Hold on?
SAVAGE: Yes, absolutely.
You know, markets always go to extremes. And I have no doubt that this market can fall further. But you don't have to even to look back to the 1920s and '30s with all the scandals that shook the market and caused reforms. Think of the conglomerates in the late '60 and early '70s, when they realized one plus one wasn't three. That was the first accounting scandal that I can remember. And then they had to sell off all these pieces of companies that they had bought with inflated-currency stock.
Well, the market came back from that. Now, it took a long time during the '70s. And I have no doubt that we are due for some below- average years, below the 10.5 percent historic average. But, long term, I think that it is America.
NEVILLE: Terry, OK, I am going to jump in.
But, Andy, I want to get something from you, because, as you pointed out, Mr. Sidgmore pointed out how important WorldCom is to America: 70 percent of the e-mails here in the U.S., largest Internet carrier, etcetera, but same as with Amtrak. Amtrak realizes that America needs that service.
So, do you think that some of these CEOs or these companies have this sort of -- I don't want to say lax -- but this disposition that, "Well, you know, we are going to get by with this because they need us"?
SERWER: Yes, you know, I don't think they can do that, because what could happen to a WorldCom, it could go bankrupt. It still could go bankrupt, yet those businesses could survive. They could be sold off to different companies. The company could be broken apart. And no CEO likes to see that. Let's face it. These people have egos. So, the pieces can survive. The economy will continue on. And these guys will be left running nothing, which is something they don't like.
I want to make a point here on an interesting development.
NEVILLE: Andy, I can't let you. I'm sorry. I am so out of time.
SERWER: OK. Oh, I'm sorry, Arthel. OK.
NEVILLE: I do apologize.
Andy Serwer, thank you very much. And, Terry Savage, we'll have you back on soon to get more detail from you.
I'm Arthel Neville. I will be back again tomorrow at 3:00 Eastern for more TALKBACK LIVE. I hope to see you then.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
