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White House Gets Ready to Go Into Iraq; Should There Be Tax Break for SUV Owners?; A Look at Super Bowl Ads

Aired January 25, 2003 - 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.


JACK CAFFERTY, HOST: Today on IN THE MONEY, sand dollars. We'll tell you who's striking it rich and who's striking out as the White House get ready to go to war against Iraq, perhaps.
Also ahead, high and mighty, or hell on wheels -- the administration wanting a tax break for the biggest of the SUVs on the road. We'll have a debate on that.

Plus this...

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We want you to be a spokesman for smoothy shaving cream. You can make huge money.

UNIDENTIFIED FEMALE: It's not about the money. This is Willie Nelson.

UNIDENTIFIED MALE: Willie, we got a small problem.

(END VIDEO CLIP)

CAFFERTY: Football and hardball. Find out how much cash is on the line when Madison Avenue goes all out with its annual Super Bowl ad blitz.

I'm Jack Cafferty. Welcome to IN THE MONEY. If you couldn't care less about money except perhaps about making more of it, like most of us do, don't let the title scare you away. We're going to try to have some fun, assuming management allows us, and if they don't, we'll play around until they throw us out of here.

Here's what we're not going to do: We're going to try not to bore you with jargon or get too technical. We promise no words like pro forma, or EBITDA, and if guests use those, they will get a visit from the IN THE MONEY Rules Committee. This is also our PR staff. They will come in, physically carry the guest out of the studio, and take them over to Lou Rukeyser's show where EBITDA and that stuff belongs.

Also for those of you watching at home, it's a new show. We're under a lot of pressure from the management here because we have a lot of new executives in charge of stuff around here. So we want you to either go next door or across the hall and get a neighbor to watch with you on Saturday and Sunday afternoons at 3:00. Once again, if we find out you're not watching, these guys will be at your house. And they'll want a satisfactory explanation for what you were doing during the time you should have been watching IN THE MONEY. We'll see more of them as we go along.

We have some brave people who decided to join me for the debut program. Andy Serwer, my buddy from "Fortune" magazine, editor-at- large, Marion Asnes, the senior editor of "Money" magazine, and Shawn Tully, who is a senior writer at "Fortune" magazine. Welcome to all of you.

First up today, we're going to look at some of the top stories. A tax break on SUVs, the president's blueprint for America. President Bush's State of the Union address coming Tuesday, and you can bet he'll be talking about the economy and about a possible war with Iraq. And we'll check with the panel on both of those subjects.

Let's start with the war. This week, France-Germany leading the retreat away from the American position of our going to war with Iraq. Has he got enough support worldwide and domestically to do this on his own with Britain and a couple of other countries if he decides to go in?

SHAWN TULLY, FORTUNE MAGAZINE: Well, I think he's making the argument, Jack, that the French and the Germans have betrayed, especially the French, betrayed the U.S., and that the French effectively signed off on the first U.N. resolution that said it was really up to Iraq to prove that they were disarming, that they were complying with all of the requirements in terms of reporting.

And so Colin Powell has really kind of tried to turn the tables in terms of international opinion by demonizing the French. Pretty effective strategy.

CAFFERTY: I think it was Powell who said the resolution does not call for the inspectors to find the needle in the haystack. The resolution requires that Iraq open the haystack and show the inspectors where the needles are, and so far, the administration says, it hasn't done that.

Marion, the economy. What do you expect on Tuesday from the president? We've got unemployment high, consumer confidence low, stock market can't get going. We have got low interest rates, but they can't cut much more, because there's no room. What's he going to do? The economy was a big issue. It hurt his father to the point he was a one-term president.

MARION ASNES, MONEY MAGAZINE: Well, you know, you've got a guy in office now who does not want to be a one-term president. Not at all. And he is going to come out with a big vision thing. He is going to have a very tough job, though, because, as you said, there is no flexibility. The surplus is gone. We have got this enormous deficit, we've got tax cuts and possibly more tax cuts that are going to expand the deficits, whether or not we go to war with Iraq.

CAFFERTY: Andy, the centerpiece of this tax cut economic stimulus plan eliminates tax on dividends. Microsoft couldn't wait to declare a dividend, because of course, Bill Gates is the biggest shareholder. He'd make $100 million a year tax-free in dividend income, but some people are saying that's not going to ever see the light of day.

ANDY SERWER, FORTUNE MAGAZINE: You know, it's too bad, because I actually like it. Because who wouldn't like it? Who wouldn't want to get more dividends in your pocket tax-free? I mean, come on here! But I think that we're starting to back away from it, because there's a real concern, how are we going to pay for all this stuff, Jack? I mean, that's what the president is facing. The war could cost $200 billion. This tax cut plan costs $674 billion. That's $874 billion all of a sudden. Meanwhile, because the economy is flat, tax receipts are falling. And I think people are really starting to question it, and, therefore, their representatives, senators and congressmen, seem to be backing off supporting that plan.

ASNES: I'd like to jump in for a second and point out two things. One is that I think a lot of people are very concerned that any tax dollars that they get to save on their federal tax return is going to come right back out of their pockets to be paid to the states or to their locality, because the states are...

SERWER: States are hurting.

ASNES: They're in big trouble.

SERWER: They are the ones that really need the money, right?

ASNES: And they really need some cash. So somewhere you're going to be paying that money.

The other thing that I wanted to point out is that the more you learn about this dividend tax issue, the more it turns into the gift to accountants and tax attorneys law. I mean, it's unbelievable. The bookkeeping is next to impossible. I mean, I can't figure it out.

SERWER: Wait a minute, you're just not going to pay taxes on dividends. Why is that so complicated?

ASNES: No, no, that is not so complicated...

SERWER: Come on!

ASNES: ... because -- no, that would be -- that makes much too much sense. This is that you don't get to pay taxes on dividends in a company where you own stocks so long as that company has already paid income taxes on the dividends two years ago.

SERWER: I'm already lost.

ASNES: Exactly.

SERWER: Sounds like the bean counters designed the whole thing.

CAFFERTY: A public opinion poll that they did I think in the last week or 10 days, well, the public actually said, don't cut taxes. I'm amazed. TULLY: They say that, Jack, but Bush is a good salesman. And when you present things like you get dividends, you're not going to be taxed. There is a lot of economic logic behind this thing, because companies already pay corporate income taxes. There is no reason for individuals to once again pay taxes. It's going to help companies to return money to investors that they've been holding on to and investing in lousy projects internally. It just makes a lot of sense.

SERWER: But there are questions, how can you afford to fight a war, cut taxes and also survive in a weak economy and get reelected. Right?

CAFFERTY: And the key phrase is the last one. Whatever all the rest of it's about, at the end of the day, it's about what to do to get reelected? Politicians are in office to stay in office. That's what they do. The public's business, it seems, is always secondary, tertiary, or somewhere on down the list of priorities.

TULLY: But really, there is no evidence that tax increases raise more money. Unfortunately, what we see is it slows economic growth, it limits entrepreneurship. The real great thing that he's doing is cutting marginal tax rates, and that really increases the amount of money that people make on their investments. And that encourages people to work and save and to invest.

CAFFERTY: And it should be pointed out, the tax plan that he's talking about has already been passed by the Congress. All he's talking about doing is moving up tax cuts that are already on the books that are scheduled to go into effect in later years, making them effective retroactive to January 1 of 2003?

ASNES: That's not the case with the dividends.

CAFFERTY: No, but the income taxes, those are already in place.

(CROSSTALK)

ASNES: That's right. But the other thing about that is, that when you are in a heavy duty deficit situation, as we are in now, there is an issue about where you're diverting capital. Is it going to be the government that is going to soak up the free capital in the bond markets in order to keep the government running, or is that money going to be loose and free for corporations to borrow? And I think that the last time we worked our of way out of a deficit, we did see that there was a very big benefit to corporations who had more money to borrow.

SERWER: This is all about the cycle. Right? I mean, come on, we're talking about taxes, marginal this and that. The economy builds up and it falls down. Right now, we're coming off one of the biggest economic booms we've had this century, or last century, and it's going to take some time to work out, and then it's going to come back, I hope, pretty soon. But it's going to take a little while. And you know, all this stuff about tax rates and this and that, we really just have to sit here and wait for a couple of years.

ASNES: I just hope (UNINTELLIGIBLE) before I retire, so that my IRA is worth something then.

CAFFERTY: In order for us to be able to tell whether that's going to happen, you'll have to tell us how old you are, and I bet you don't want to do that.

(LAUGHTER)

CAFFERTY: How long it is before retirement.

SERWER: We got a few years left here.

CAFFERTY: I know one thing, I don't have that much time left. Mine's around the corner so...

ASNES: Well, you know, I'll tell you this, as my grandmother always said, I'm 21-plus.

CAFFERTY: There you go. And you don't look a day over 23.

Coming up on IN THE MONEY, more brawn for less bucks. Those delicate little SUVs could mean a big tax break for some drivers. We'll debate that issue.

Plus this...

(MUSIC)

CAFFERTY: We'll show you the second best thing about the Super Bowl, and I don't mean the cheerleaders. We're talking about those fascinating television commercials.

Plus, the sounds of silence. Microsoft says its new software will have music pirates singing another tune. Find out how Bill Gates is giving the kissoff to the rip-off artists.

And we'll see whether KMart's financial records are as low-budget as some of the stuff on their shelves. The feds have been crunching Kmart's numbers. We'll tell you what they came up with, next.

(COMMERCIAL BREAK)

CAFFERTY: I like that music. Not bad. You played that in your garage?

SERWER: Yes, I did, on my little (UNINTELLIGIBLE).

CAFFERTY: Seems like no one is middle of the road anymore when it comes to the subject of SUVs. Heating up the dispute, word of a possible big tax break for SUVs, allowing small-business people to write these down to the tune of $75,000. But not everybody thinks that's a great idea, giving some an exemption worth tens of thousands of dollars, but not everyone.

Meantime, there are a few pros in the SUV debate. You're riding high in something that feels like a cross between a tank in your living room, they ride pretty smooth, the big, luxurious ones, a lot of the drivers think that they're safer in an accident, and in some ways I suppose that's true. You've got the bigger vehicle if you run into a smaller car, but the rollover tests indicate that they're not so safe that way, and sometimes if you got to haul a lot of kids and all that, you can save time and money by using one of these. Their gas-guzzling nature, though, is growing more unpopular when this country is re-examining its reliance on foreign oil from the Middle East, and there have been ads on the air that liken owning an SUV to subsidizing terrorism.

That's a bit much, but we'll talk about it. We're going to take this fight into the studio now. It's a street fight. Sticking up for the SUV, Nick Gillespie. He's editor-in-chief of "Reason" magazine. He joins us from Cincinnati. Looks like an SUV kind of guy. And in Washington, speaking out for the people of Hummer Equals Bummer, is Gregg Easterbrook, the senior editor of "The New Republic."

Gregg, let me start with you. I'll grant you, they're tough to see around, some of the drivers seem to be more aggressive when they're in the big cars, but hasn't this thing gone a little bit too far?

GREGG EASTERBROOK, NEW REPUBLIC: Well, it's the SUVs, the large ones, that at least go too far. The key points about them is they're exempt from pollution control rules that apply to regular cars. They're not...

CAFFERTY: But so are diesel trucks.

EASTERBROOK: Sorry?

CAFFERTY: So are diesel trucks, aren't they, I mean?

EASTERBROOK: Yes, but the typical person doesn't drive a diesel truck. And actually, diesel fuel emission rules were just significantly strengthened by the Bush administration.

CAFFERTY: OK.

EASTERBROOK: They're exempt from -- from the air emission rules, they are held to a lower fuel efficiency standard, and they are not anywhere near as safe as regular cars. I think that's the great fallacy of this debate. People buy SUVs thinking, well, I'm going to be in this huge tank, and then if there's a crash, the other guy will get killed. The National Academy of Sciences' report last summer concluded that you are more likely to die inside an SUV than you are inside a regular car.

CAFFERTY: But that includes the rollover statistics, doesn't it?

EASTERBROOK: Yes.

CAFFERTY: The rollover feature of these is a liability. I think everybody will agree to that, that these are -- three times I think the stat is more likely to die in a rollover of an SUV than you are in a rollover of a standard car. However, if I'm driving a Lincoln Navigator and I run into a Ford Taurus, I got a better shot of walking away than the guy in the Taurus, don't I?

EASTERBROOK: Yes, in a head-to-head collision, if you're in a big hunk of metal, you're more likely to survive. But since one-third of highway fatalities happen in rollovers, you end up in your Lincoln Navigator being in greater danger overall than you would be in your Ford Taurus.

CAFFERTY: All right, Nick, let's bring you in here and get you to address the other side of this. The three main criticisms, as Gregg was talking about, they're environmentally not so good. They are unpatriotic, and I want to explore this, this whole idea that if you have an SUV you're subsidizing Osama bin Laden and al Qaeda, and the charge is that SUV owners are somehow mentally unbalanced, that it's a whole machismo thing and they've got to get into these big cars and bully everybody. So pick it up where you like and let us hear your thoughts.

NICK GILLESPIE, EDITOR-IN-CHIEF, REASON MAGAZINE: Well, let me just point out for starters that a couple of months ago this debate was talking about what would Jesus drive? And now we're asking what would Arianna Huffington drive? Which might suggest that we've reached the point of diminishing returns in the value of this conversation.

But let me first -- you know, the charges are that SUVs are environmentally damaging, that they're unpatriotic and they're unsafe. I don't think any of those cases is particularly convincing. While SUVs are not as gas-efficient or as fuel-efficient as other cars, they're still better than a lot of cars that are still on the roads that were made in the 1980s. When we're talking about safety, one of the -- over the past 20 years, the number of light trucks, the class that includes SUVs as well as pickups and minivans, have doubled. The number of those cars on the road have doubled, while the number of fatalities per million vehicles miles driven has dropped to 1.5, which is a record low.

And, in fact, to talk about SUVs on balance, they do worse on rollovers, but overall, according to researchers at Rutgers who take into account the fact that SUVs and light trucks are more popular in rural areas, they've actually estimated that they save about 500 lives a year.

CAFFERTY: Gregg, let me ask you. You're on the record as saying there's something psychologically unbalanced about people who own SUVs. Talk to me about that view of people who buy these vehicles.

EASTERBROOK: Well, the big ones, yes. I think that people who own a Hummer H2 or Ford Excursion, the things that weigh three or more tons, are trying to boast something about the world that I certainly wouldn't want to boast to the world. But let me get back to the safety point Nick is making, because he's not using the data correctly. His argument -- it's certainly true that we all live longer as Americans, but we would live even longer than that if we weren't overweight and we didn't smoke cigarettes. This is the flaw in the way he states the argument. It's true that... GILLESPIE: Wait, wait a minute. Aren't you guys -- I mean, this is all this moralizing stuff, you know, the psychological stuff about trying to tell me I'm too macho to drive this thing, I'm too fat? I mean, shouldn't the markets decide? You know, in the 1970s, the price of oil went up, we started driving smaller cars. If these things are really so bad, people would just stop driving them. I mean, Arianna Huffington sounds like Eva Gabor or something, going on on this issue. I mean, can't people just decide to drive what they want to drive?

ASNES: Every market survey that Detroit has ever done over the past 10 years, there is -- people really don't care about gas mileage, I have to point that out. It's way down.

CAFFERTY: What about letting the market determine what's going on with these things? What's wrong with that approach?

GILLESPIE: Well, if I can actually agree with Gregg on something, and it might be the only thing we agree on, which is the tax incentive thing comes in to play. I think the tax incentives in the country in general are bad because they attempt to do social engineering through the tax cut. And I think that the tax break for massive SUVs for business owners is wrong. I don't think that's the right thing. I don't think it was the right thing to give massive tax breaks and subsidies to various states and federal governments did for electric vehicles, but the electric vehicle experience also shows something, which is that tax breaks at the margin do not change major behaviors in America. They might affect it a little bit, but they're not prime movers.

The reason why SUVs are popular, the reason why minivans are popular and the reason why pickup trucks are popular, is because people like driving them and they like the associations that they have with them.

CAFFERTY: I have to run. I just got one quick question for Gregg. If I bet a ton of money on the Super Bowl this weekend and win, and I want to go out and get me a big old Hummer to drive around on Monday to kind of just feel good about this killing I made on the Super Bowl, should I also be making an appointment with my neighborhood shrink to go in and get a little counseling, do you think?

EASTERBROOK: Let me make the safety point that you cut me off in the middle of. It is true that miles -- that fatalities per mile driven have declined in the last 20 years. They've declined because of air bags, ABS brakes, crumple (ph) zone engineering, because of improvements in the design of cars. At the same time, fatalities from rollovers have increased. So we have two countervailing trends. You have most cars being safer; people buying SUVs that are more dangerous. If it weren't for the SUV fad, fatalities would have declined far more significantly.

CAFFERTY: All right, and now you can maybe answer my question about a Hummer. If I buy a Hummer, you think there is something wrong with me intrinsically, because I decided to go out and spend some inheritance or gambling win on a big, flashy car that makes me feel good?

EASTERBROOK: Yes. I don't think it's just a matter of aesthetics. You buying a Hummer creates a risk to me. If you want to buy the Hummer and put it in your backyard, that would be your business, but if you want to buy the Hummer and run the risk of killing somebody else, then it's my business.

CAFFERTY: All right, that's fair enough. Gregg, I've got to run. Thank you. Senior editor of "The New Republic" in Washington -- "New Republic" magazine in Washington, D.C., and Nick Gillespie, the editor-in-chief of "Reason" magazine in Cincinnati, Ohio.

Still ahead on IN THE MONEY, software that tells music pirates, stick it in your ear. I like that phrase. We'll have the details of a new product from Microsoft.

Also, jacket, tie and cuffs, as in handcuffs. WorldCom's former money man says his old look might not be in fashion when he goes to court.

And for once, some ads you might actually want to watch, a preview of Madison Avenue's Super Bowl commercials, when we come back.

(COMMERCIAL BREAK)

CAFFERTY: All right. We've all parked our SUVs and we're going to continue this program.

We're going to have a regular feature every week called "Stock of the Week." This week, Microsoft is the company. The software giant continuing its efforts to stave off antitrust problems. On Monday, Microsoft and Sun Microsystems entered into an agreement, a court- ordered plan to share some of their technology. But Microsoft's antitrust problems potentially loom large in Europe. This week the company met with EU regulators hoping to avoid the worst of antitrust sanctions that may be pending over there, and Microsoft may be about to establish another monopoly, that's because every music company in the world might soon be using Microsoft's new technology that it claims can help stop CD piracy.

We'll bring in a panel to check on this. I'm not sure this is that big an issue. I don't know whether the music companies are complaining because of downloading or it's just bad music the people aren't buying. But is this the answer to anybody's problems?

TULLY: Jack, my reaction is it's not going to work. People want to download too badly. And kids have found every possible way around all the restrictions and those court orders and the lawsuits, and Napster went out of business...

CAFFERTY: Napster was the one I wasting to think of that they ran out.

TULLY: Yes. And the kids are downloading and burning CDs. And the reason -- the music industry has no one to blame but themselves.

CAFFERTY: How so?

TULLY: Because CDs are outrageously overpriced. You go in, you buy, $16, $18.

SERWER: You know what, Shawn, I mean, these guys have got to get paid. Not the record company executives, they charge too much. But you know, the artists have got to get paid, right? Dave Matthews has got to get paid. And all these people who call it file sharing -- it's file stealing! They're stealing tunes. OK? You're stealing songs.

CAFFERTY: Let's get Kurt Loder into this conversation. He's one of America's most respected music journalists, former "Rolling Stone" editor. For 25 years, though, he's anchored MTV's "Daily News" show and he joins us from over there near Times Square. Kurt, nice to have you with us. What's your take on the downloading issue and whether or not some piece of software is the answer to the music industry's problems on this?

KURT LODER, MTV NEWS ANCHOR: Well, piracy is theft, and file sharing is theft, too, that's true. I think file sharing is a little different. It's sort of like kids, you know, trading tapes 20 years ago.

CAFFERTY: Right. But that was illegal, too, wasn't it, technically?

LODER: It's illegal, too. Piracy is really, really illegal. You know, record companies lose a lot of money on this. The file sharing thing I agree that kids are not going to be stopped from doing this. You'll not put this genie back in the bottle. It's here to stay. And, you know, Microsoft programs, how long does it take them to get the bugs out of these things to begin with? And kids will find their way around it, I think. They'll just hack away around it.

CAFFERTY: What about the complaint that says, you know, the music companies are blaming their lack of sales, lack of revenue, lack of profits on all the downloading when some might say, you know what? The music's not as good as it used to be, and they're not targeting a wide enough audience. Everything seems aimed at the Britney Spears/J. Lo crowd. And maybe the product's not what it ought to be. Is there any validity to that?

LODER: I think there's something to that, too. I think the Britney Spears thing is fading a little bit, although teen pop will always be with us for sure.

CAFFERTY: I'm sorry to hear Britney's fading. Is that true?

LODER: Well, not fading a lot. She'll be with us a while. But I think that's part of it. And the overpriced CDs, that's true. You know, if you pay $18 for a CD -- and what if you paid $18, and like more than half of the tracks are tracks that you don't like, whereas if you go online, you can download maybe the three or four that you do like and save a lot of money. TULLY: Just to refer to what Kurt just said, the idea that the reason these CDs are so expensive, because artists are getting the money that they deserve to get. The -- immediately -- the first thing a record company demands is that the artist assign the copyrights to the record company. And then they don't get any royalties on the records, so they pay back all the marketing expenses, which could be hundreds or thousands of records before they see -- or CDs -- before they see dollar one. So this whole idea about copyright protection, protecting artists is a total ruse.

SERWER: Yes, but so what, are the record companies going to go out of business? I mean, Kurt, what should the record companies do here, or do we even care if they go out of business?

LODER: I think they need a new business model. I think they've got these enormous catalogues; they should open them up, they should find a way to be online themselves, and people should be able to buy this stuff. I think they're really behind the curve here. I think that has to be done pretty quickly if they want to beat this. Napster's gone, but there could be thousands of these file sharing sites showing up.

CAFFERTY: You talk about how expensive CDs are. I'm arguably the oldest guy involved in this conversation. And I can remember going to the record store in Reno, Nevada and paying $5.95 for an album of Beatles songs, for example, back in the '60s, 35 years ago. And I don't know what the rate of inflation is overall in the economy, but if a CD today costs $18, it doesn't seem to me like that's too far out of line, based on what I remember having to pay all those years ago. True or false?

LODER: Well, you know, CDs cost, I don't know, what, $1.50 to make or something? You do have to pay the performer, and there are costs to that; I think they're probably still way overpriced. It seems to me.

ASNES: I don't think they're that overpriced, but I think that when you look at the idea that you have a choice between paying $18 in the store and getting something for free on the net, I mean, the decision is pretty easy to make.

CAFFERTY: It's easy to do, right?

ASNES: Yes.

CAFFERTY: Kurt, you mentioned a new business model. What would it look like, if you could design it?

LODER: I think it seems to me, I'm not an expert on this, but it seems to me they have these vast catalogues of music that people want, going back, you know, 50 years or more. If this could be made available to people, you can't even find all this stuff in record stores, if they could just put it online somehow, I'm sure it would be very complicated, but this would seem to be some sort of answer, and, you know, they could charge for it.

I don't know if this is going up against free file sharing, but it might be a start.

SERWER: You know, Kurt, picking up on something that Jack said, that the music isn't any good now, I mean, you're always tempted to say that as you get older, but I ask you this question -- name me 10 songs from the past year that people will be singing 10 years from now? I mean, the music's no good.

LODER: Well, that's not true. There's always good music around. The music you hear on radio or the music you hear on TV, it's a very small slice of what's going on in music. There's much more music being made. There are a whole bunch of bands coming from Scandinavia now, that I think many of them are really, really good. The Hives are good. (UNINTELLIGIBLE). That's coming up, fabulous. So there is good music being made. You may not hear it all, but, again if you're online, maybe you can hear it. So I think people are exposed to a lot of stuff online, too.

CAFFERTY: Kurt, I appreciate you joining us here. You're on TV in my home a lot. I have got a 17-year-old daughter and she lives with that MTV in her room almost continuously. Nice to have you with us. Thank you. Kurt Loder of MTV.

Still ahead on IN THE MONEY, the feds want to know if Kmart is discounting the truth? They're wrapping up a look at the company's books. We'll tell you what they think they might have found, coming up.

Plus, cuff links. Real cuff links. WorldCom's former CFO thinks some shots of him in handcuffs might send the wrong impression. Different from the kinds of shots that we get of other criminal suspects when they are arrested and put in handcuffs. That's coming up on "Scandal Watch."

And find out...

(CROSSTALK)

CAFFERTY: Find out what Super Bowl ads might be good for something more than grabbing a snack. You might want to stay in the room this year. Madison Avenue is going to try real hard to make you stay out of the bathroom during the ball game. Back after this.

(COMMERCIAL BREAK)

CAFFERTY: A lot of music on this program.

SERWER: Yes.

CAFFERTY: Tough to talk money these days without mentioning all the corporate scandals and weasels that are out there. This week full of updates for our "Scandal Watch" segment, which we'll do every week. Former WorldCom Chief Financial Officer Scott Sullivan suffered a legal setback on Tuesday. A federal judge shot down Sullivan's whining request to move his trial from Manhattan. Sullivan says he won't be able to get a fair trial because of all the widespread news reports showing the feds taking him away in handcuffs, just like they would if he'd been a suspect in the 7-Eleven robbery. This is what they do with criminal suspects when they arrest them; they put them in handcuffs, this is a standard procedure.

The kiss-and-tell insider trading case heating up. The feds may soon charge Lehman Brothers analyst Holly Becker with tipping off her trader husband about a negative report that Lehman made about Amazon stack back in the year 2000.

Kmart's filed for bankruptcy -- in fact, they've gone bankrupt. Now, prosecutors may hit some former Kmart executives with criminal charges. A federal grand jury is focusing on about $29 million worth of loans that Kmart gave two dozen executives, don't you know, just as the company was going under. Most of the men who got the loans have left the company since it filed for bankruptcy last year.

I thought we were supposed to have solved all these corporate malfeasance and competence problems with new legislation. What's going on?

TULLY: The funniest one is this whole SEC thing, because it's a very secretive hedge fund, and it turns out that Steve Cohen (ph), who runs the fund, was very influenced by his psychiatrist, his shrink, who exorcised his demons and made him into a great trader, and they've written a book together.

CAFFERTY: Oh, that's good. Andy.

SERWER: Listen, I am concerned about these perp walks for these executives. I think they're terrible. Don't people know those are very expensive French cuffs that some of those executives were -- it might hurt them, it might ruin them. Feed them to the lions. I mean, come on.

(CROSSTALK)

CAFFERTY: Marion.

ASNES: I want to go work for Kmart so that I can get a $5 million retention loan and then leave the company. I just, you know, that would do wonders for me!

CAFFERTY: If somebody loaned me $5 million, I'd be out of CNN before this program was over.

SERWER: You do this for the love.

CAFFERTY: Yes, that's true.

Time for us to pay the rent. We're going to take a break and watch some of these here commercials so that AOL Time Warner can trudge ahead in this world. We'll be back, more after the ads about the ads. Madison Avenue making the Super Bowl commercials as much fun in some cases as the game itself. Stick around. See where the ad guys managed to do the impossible yet again. My hunch is they have.

We'll show you a fast food joint where they're making burgers without a side order of legal problems. As McDonald's wraps up a court fight, check out our "Web Site of the Week." Stay with us.

(COMMERCIAL BREAK)

CAFFERTY: The Oakland Raiders set to take on the Tampa Bay Buccaneers in Super Bowl XXXVII at Qualcomm Stadium in San Diego -- I missed -- a number of subplots to talk about as we're getting ready for the big game, beginning with Tampa Bay coach Jon Gruden. At this time a year ago, Gruden was the coach of the Raiders. He jumped ship when Tampa Bay offered him a bunch of bucks, and a better climate. And a lot of the Raiders are still steamed. They feel betrayed by his leaving. He's a popular coach with his players.

Then you have the wild, rowdy and sometimes violent Raider fans. They call themselves Raider Nation. Mutants would be another good word. Every time these Raider fans go to San Diego during the regular season, it seems there's always trouble. The stadium routinely cutting back on alcohol sales during Raider-Charger games. But that sometimes doesn't help. In October 2000, a Raiders fan stabbed a Chargers fan outside the stadium. The victim survived, but just barely.

And then there is that other Super Bowl contest, the one where nobody throws the ball, everybody instead making a pitch. ABC is asking $2.2 million for one 30-second commercial during Sunday's game. A few companies are gambling big bucks and bright ideas that they've got the right way to sell their products. Ideas merchandised to one of the largest TV audiences of the entire year. H&R Block has Willie Nelson singing its tune. Watch this.

(BEGIN VIDEO CLIP, H&R BLOCK COMMERCIAL)

UNIDENTIFIED MALE: We want you to be a spokesperson for smoothy shaving cream. You can make huge money.

UNIDENTIFIED FEMALE: It's not about the money. This is Willie Nelson.

UNIDENTIFIED MALE: Willie, we've got a small problem. You made a little mistake on your taxes. You owe $30 million.

WILLIE NELSON, MUSICIAN: I what?

UNIDENTIFIED FEMALE: Action!

NELSON: This play calls for smoothie.

UNIDENTIFIED MALE: Cut!

NELSON: Have a smooth move!

UNIDENTIFIED MALE: Cut. Willie, make a smooth move. Action!

NELSON: My face is burning!

UNIDENTIFIED MALE: Don't get bad advice. At H&R Block...

(END VIDEO CLIP)

CAFFERTY: Imagine, an H&R Block tax commercial with a sense of humor. Comments from the panel? What's your favorite Super Bowl ad, Shawn?

TULLY: Well, I'll pick that one right there. That's pretty good.

(CROSSTALK)

TULLY: You'd never know it's a tax commercial when it first starts. And look at Willie Nelson mocking his own tax problems. It certainly takes a certain amount of chutzpah to do that.

(CROSSTALK)

ASNES: Well, it's not Willie. But I do want to point out that he actually paid $16.5 million to the feds to clear up his tax problems, which is a lot of -- you know, he should work at Kmart!

But my favorite is the Osbournes to the Osmonds.

CAFFERTY: The Pepsi commercial. We'll look at that.

ASNES: Oh, that's unbelievable.

CAFFERTY: You have a favorite?

SERWER: Yes, going all the way back, remember the Apple one? 1984, Macintosh, 1984, the woman running. They only ran that commercial one time, and that's what really started this whole, you got to make a big, huge splashy commercials for the Super Bowl.

CAFFERTY: All right, Barbara Lippert is an ad critic for "Ad Week" magazine. She's going to join us as we talk about the psychology of million dollar, single 30-second spots. And Barbara, it's nice to have you with us. Was Macintosh the start of this cachet that suddenly these commercials have?

BARBARA LIPPERT, AD WEEK: Yes. It was almost 20 years ago, and the thing was, it was introducing a revolutionary product. It was introducing the Macintosh. So it could be huge. It could use Ridley Scott, it could live up to all the claims that 1984 was not going to be like "1984." You know, the problem is, if you're selling gum or soda, you sort of can't make those extravagant claims and change the world.

CAFFERTY: But in the year 2000, they had commercials on for something else that was revolutionary and brand new. There were 13 commercials during the Super Bowl for the dot-com companies. The Internet was brand new. That didn't work out so well, didn't it?

LIPPERT: No. By the following year, only three of those companies were alive. All of those companies gambled their whole budget to be on the Super Bowl, and then went out of business. CAFFERTY: Wow. Who's the champion? As you look back through the years of Super Bowl commercials, who does the best job of using that very expensive time to get their message out?

LIPPERT: Well, the Apple one is always, you know, it's best of the century, really. And then they followed it the next year with a bunch of lemmings, which was the dog of all time. So you can go from the highs to the lows.

So one -- E-trade, which is not among us this year, the one where the guy -- the monkey was surveying all of the dead dot-com landscapes? That was absolutely brilliant. And another one for Monster.com, where the kids were saying, I want to be in middle management. I want to file, file, file! Talking about what jobs they wanted when they grew up was another brilliant one.

CAFFERTY: All right. Let's take a look. This is another. We were able to get a couple of the commercials that you'll see during the game tomorrow. You're viewing this on Saturday afternoon. Here's Pepsi's offering this year. Check this out.

(BEGIN VIDEO CLIP, PEPSI COMMERCIAL)

(MUSIC)

OZZY OSBOURNE, MUSICIAN: Sharon! Sharon, the kids have turned into the Osmonds!

UNIDENTIFIED FEMALE: Oh, dear, dear, dear, go back to sleep!

UNIDENTIFIED MALE: Like twist, Pepsi twist...

(END VIDEO CLIP)

LIPPERT: You cut the beginning, but the kids come in, they're acting like pod people, Kelly and Jack, and he's fussing with the garbage, which was what happened with the show, they turn into the Osmonds, and that's funny enough, but then the kicker with Florence Henderson, you know, really has (UNINTELLIGIBLE).

CAFFERTY: It's a follow-up, too, to the one that had Halle Berry, and that's not really Halle Berry, that's Barry Bostwick. And Barry Bostwick comes on, and says, "what's a Barry Bostwick?" Very clever stuff.

What about production costs? I mean, you don't hire the Osmonds and what's his face, and the Osbournes and all of these people. That has to cost some money to do these? Don't they have to pay the big bucks to get these celebrities?

LIPPERT: They pay big bucks. And sometimes it's not worth it. I mean, there is a Haines commercial, it has Jackie Chan and Michael Jordan. And they don't interact, because they shot them on different days. And Jackie Chan just jumps around like a demented kind of cat, scratching, and there's no story, there is no build, there is no surprise, whereas a tiny little commercial like the Trident commercial using a squirrel on the fifth dentist who did not recommend Trident, it probably cost, you know, an eighth of that and is going to do very well.

CAFFERTY: So it's not necessarily true that a celebrity is going to carry the day for your commercial? It's the idea and the way you communicate the idea?

LIPPERT: Absolutely -- and pets are always big. Animals are big. And as one trainer said, they don't cost nearly as much as Britney Spears.

CAFFERTY: How high is up? The first Super Bowl commercial, $47,000, that was more years ago than I care to remember. Now they're $2.2 million. Is there some kind of an upper limit on this stuff, do you think?

LIPPERT: Well, last year it was down to $1.7 to $1.9. So it's back up again this year, which is great for advertising, because it's been a really savage year. It's been a terrible year. So I think it will continue to go up.

CAFFERTY: The falloff on advertising, I suppose to a small degree, could be related to the events of September 11. I remember the tone of the commercials in the Super Bowl that January following September 11. Much more somber. Much more serious. As you might expect. How tough is it in terms of lead time for these companies to make sure they've got a handle on what the right mood of the country's likely to be when they go into production on this?

LIPPERT: Well, now they're very worried that war will break out in the middle of the Super Bowl and they have to have all kinds of contingency plans. But yes, last year, it was much more muted and patriotic. People were scared to celebrate. You know, there was one black humored commercial, and everyone thought that was in terrible taste. This year, you know, the same company did the owner showing up in his underpants, because he's so dedicated to making Quizno subway sandwiches. At least they cover his ass with a big bun (UNINTELLIGIBLE).

(CROSSTALK)

LIPPERT: Yes. It's back to the basics and the gross jokes that go over with a big roomfuls of drunk people watching.

CAFFERTY: Have you seen all the ads for this year?

LIPPERT: I've seen all of them, except Budweiser, which does not release them. And Budweiser is usually the most talked about on Monday morning.

CAFFERTY: They do consistently an outstanding job. Barbara, thanks for kicking this around with us on IN THE MONEY. I appreciate you being part of the broadcast.

LIPPERT: Thank you.

CAFFERTY: Barbara Lippert, ad critic at "Ad Week" magazine.

Still ahead, with McDonald's coming off a court fight, we'll put you behind the counter in a virtual fast food joint. Just don't come whining to us about wanting minimum wage. You'll have to take that up with somebody else. Back after this.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

MICHAEL CARTY: The consumer's going to continue to be strong this year, and possibly a lot better, despite the fact that unemployment might rise. I think this is also going to be a good year for investors. So consumer -- or money-conscious consumers should really start looking about where they should be putting their money.

STEPHEN PORPORA: The markets technically is at a level where I'm not -- I don't think we have a lot of down side at this point, but what we do need is, we need a significant shot of very good news to get this market moving through the current trading pattern that it's in.

MARY DAVIS: We're expecting a resolution of the Gulf crisis by early in the second quarter, and that in turn is going to allow a rebound in the equity markets and quite a strong rally across all of them, in particularly Nasdaq, and allow oil prices to drop back to about $20 a barrel, (UNINTELLIGIBLE).

(END VIDEOTAPE)

(COMMERCIAL BREAK)

CAFFERTY: Remember the people who sued McDonald's because they said the fast food chain was responsible for making kids fat? This week, a federal judge threw that case out, rightfully so, and nobody forced anybody to go in there and eat. But the next fat based lawsuit is probably not too far away. And that's where the "Web Site of the Week" comes in.

If you want to open a lawyer-proof burger joint, we've got the answer. You're going to have to do it online, though. This is Burger Blitz. You can go here, grill as many cheeseburgers, bacon, eggs, anything you want, with no fear of a visit from the food police or the lawyers. If you have to be healthy even in the virtual world, you can make a veggie burger too, but why would you want to? Get your shake and large-sized everything!

Here's the Web site address. Go there and have yourself a little party. The burger making time-wasting revelry is courtesy of our good buddy Allen Wastler, a friend of mine, who is also the managing editor of Money.com. And what we'll do is we'll have one of these a week. And if you have one that you think the rest of the viewers might enjoy, well, you can share.

At the top of the program, I mentioned it's our first IN THE MONEY program. If you like what you see, if you want to recommend a "Web Site of the Week," if you have comments, drop us a line and tell us what's on your mind. Keep in mind, though, when you do that we do have the IN THE MONEY Rules Committee and public relations squad standing by to go through the e-mail. And if they don't like what it is you send, they'll be coming out to the house to discuss the contents of the letter with you.

The e-mail address is inthemoney -- that's one word -- @cnn.com. We actually did get a letter already. Rod wrote to us this morning, saying: "Hi, Jack, wondering if you were going to have the sharp wit and answers on the new show, or is it going to be like all the other boring money shows?" We're not showing this to Lou Dobbs, by the way. "I realize the markets are bad, but we should be able to have a laugh, and I think they're doing the right thing by putting you on as host. Good luck. I'll be watching."

We'll try. Thank you.

That's it for the first edition of IN THE MONEY. I want to thank our panelists, Marion Asnes of "Money" magazine, my friend Andy Serwer from "Fortune" magazine, and Shawn Tully.

I'm Jack Cafferty. See you next time.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com





Tax Break for SUV Owners?; A Look at Super Bowl Ads>


Aired January 25, 2003 - 15:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JACK CAFFERTY, HOST: Today on IN THE MONEY, sand dollars. We'll tell you who's striking it rich and who's striking out as the White House get ready to go to war against Iraq, perhaps.
Also ahead, high and mighty, or hell on wheels -- the administration wanting a tax break for the biggest of the SUVs on the road. We'll have a debate on that.

Plus this...

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We want you to be a spokesman for smoothy shaving cream. You can make huge money.

UNIDENTIFIED FEMALE: It's not about the money. This is Willie Nelson.

UNIDENTIFIED MALE: Willie, we got a small problem.

(END VIDEO CLIP)

CAFFERTY: Football and hardball. Find out how much cash is on the line when Madison Avenue goes all out with its annual Super Bowl ad blitz.

I'm Jack Cafferty. Welcome to IN THE MONEY. If you couldn't care less about money except perhaps about making more of it, like most of us do, don't let the title scare you away. We're going to try to have some fun, assuming management allows us, and if they don't, we'll play around until they throw us out of here.

Here's what we're not going to do: We're going to try not to bore you with jargon or get too technical. We promise no words like pro forma, or EBITDA, and if guests use those, they will get a visit from the IN THE MONEY Rules Committee. This is also our PR staff. They will come in, physically carry the guest out of the studio, and take them over to Lou Rukeyser's show where EBITDA and that stuff belongs.

Also for those of you watching at home, it's a new show. We're under a lot of pressure from the management here because we have a lot of new executives in charge of stuff around here. So we want you to either go next door or across the hall and get a neighbor to watch with you on Saturday and Sunday afternoons at 3:00. Once again, if we find out you're not watching, these guys will be at your house. And they'll want a satisfactory explanation for what you were doing during the time you should have been watching IN THE MONEY. We'll see more of them as we go along.

We have some brave people who decided to join me for the debut program. Andy Serwer, my buddy from "Fortune" magazine, editor-at- large, Marion Asnes, the senior editor of "Money" magazine, and Shawn Tully, who is a senior writer at "Fortune" magazine. Welcome to all of you.

First up today, we're going to look at some of the top stories. A tax break on SUVs, the president's blueprint for America. President Bush's State of the Union address coming Tuesday, and you can bet he'll be talking about the economy and about a possible war with Iraq. And we'll check with the panel on both of those subjects.

Let's start with the war. This week, France-Germany leading the retreat away from the American position of our going to war with Iraq. Has he got enough support worldwide and domestically to do this on his own with Britain and a couple of other countries if he decides to go in?

SHAWN TULLY, FORTUNE MAGAZINE: Well, I think he's making the argument, Jack, that the French and the Germans have betrayed, especially the French, betrayed the U.S., and that the French effectively signed off on the first U.N. resolution that said it was really up to Iraq to prove that they were disarming, that they were complying with all of the requirements in terms of reporting.

And so Colin Powell has really kind of tried to turn the tables in terms of international opinion by demonizing the French. Pretty effective strategy.

CAFFERTY: I think it was Powell who said the resolution does not call for the inspectors to find the needle in the haystack. The resolution requires that Iraq open the haystack and show the inspectors where the needles are, and so far, the administration says, it hasn't done that.

Marion, the economy. What do you expect on Tuesday from the president? We've got unemployment high, consumer confidence low, stock market can't get going. We have got low interest rates, but they can't cut much more, because there's no room. What's he going to do? The economy was a big issue. It hurt his father to the point he was a one-term president.

MARION ASNES, MONEY MAGAZINE: Well, you know, you've got a guy in office now who does not want to be a one-term president. Not at all. And he is going to come out with a big vision thing. He is going to have a very tough job, though, because, as you said, there is no flexibility. The surplus is gone. We have got this enormous deficit, we've got tax cuts and possibly more tax cuts that are going to expand the deficits, whether or not we go to war with Iraq.

CAFFERTY: Andy, the centerpiece of this tax cut economic stimulus plan eliminates tax on dividends. Microsoft couldn't wait to declare a dividend, because of course, Bill Gates is the biggest shareholder. He'd make $100 million a year tax-free in dividend income, but some people are saying that's not going to ever see the light of day.

ANDY SERWER, FORTUNE MAGAZINE: You know, it's too bad, because I actually like it. Because who wouldn't like it? Who wouldn't want to get more dividends in your pocket tax-free? I mean, come on here! But I think that we're starting to back away from it, because there's a real concern, how are we going to pay for all this stuff, Jack? I mean, that's what the president is facing. The war could cost $200 billion. This tax cut plan costs $674 billion. That's $874 billion all of a sudden. Meanwhile, because the economy is flat, tax receipts are falling. And I think people are really starting to question it, and, therefore, their representatives, senators and congressmen, seem to be backing off supporting that plan.

ASNES: I'd like to jump in for a second and point out two things. One is that I think a lot of people are very concerned that any tax dollars that they get to save on their federal tax return is going to come right back out of their pockets to be paid to the states or to their locality, because the states are...

SERWER: States are hurting.

ASNES: They're in big trouble.

SERWER: They are the ones that really need the money, right?

ASNES: And they really need some cash. So somewhere you're going to be paying that money.

The other thing that I wanted to point out is that the more you learn about this dividend tax issue, the more it turns into the gift to accountants and tax attorneys law. I mean, it's unbelievable. The bookkeeping is next to impossible. I mean, I can't figure it out.

SERWER: Wait a minute, you're just not going to pay taxes on dividends. Why is that so complicated?

ASNES: No, no, that is not so complicated...

SERWER: Come on!

ASNES: ... because -- no, that would be -- that makes much too much sense. This is that you don't get to pay taxes on dividends in a company where you own stocks so long as that company has already paid income taxes on the dividends two years ago.

SERWER: I'm already lost.

ASNES: Exactly.

SERWER: Sounds like the bean counters designed the whole thing.

CAFFERTY: A public opinion poll that they did I think in the last week or 10 days, well, the public actually said, don't cut taxes. I'm amazed. TULLY: They say that, Jack, but Bush is a good salesman. And when you present things like you get dividends, you're not going to be taxed. There is a lot of economic logic behind this thing, because companies already pay corporate income taxes. There is no reason for individuals to once again pay taxes. It's going to help companies to return money to investors that they've been holding on to and investing in lousy projects internally. It just makes a lot of sense.

SERWER: But there are questions, how can you afford to fight a war, cut taxes and also survive in a weak economy and get reelected. Right?

CAFFERTY: And the key phrase is the last one. Whatever all the rest of it's about, at the end of the day, it's about what to do to get reelected? Politicians are in office to stay in office. That's what they do. The public's business, it seems, is always secondary, tertiary, or somewhere on down the list of priorities.

TULLY: But really, there is no evidence that tax increases raise more money. Unfortunately, what we see is it slows economic growth, it limits entrepreneurship. The real great thing that he's doing is cutting marginal tax rates, and that really increases the amount of money that people make on their investments. And that encourages people to work and save and to invest.

CAFFERTY: And it should be pointed out, the tax plan that he's talking about has already been passed by the Congress. All he's talking about doing is moving up tax cuts that are already on the books that are scheduled to go into effect in later years, making them effective retroactive to January 1 of 2003?

ASNES: That's not the case with the dividends.

CAFFERTY: No, but the income taxes, those are already in place.

(CROSSTALK)

ASNES: That's right. But the other thing about that is, that when you are in a heavy duty deficit situation, as we are in now, there is an issue about where you're diverting capital. Is it going to be the government that is going to soak up the free capital in the bond markets in order to keep the government running, or is that money going to be loose and free for corporations to borrow? And I think that the last time we worked our of way out of a deficit, we did see that there was a very big benefit to corporations who had more money to borrow.

SERWER: This is all about the cycle. Right? I mean, come on, we're talking about taxes, marginal this and that. The economy builds up and it falls down. Right now, we're coming off one of the biggest economic booms we've had this century, or last century, and it's going to take some time to work out, and then it's going to come back, I hope, pretty soon. But it's going to take a little while. And you know, all this stuff about tax rates and this and that, we really just have to sit here and wait for a couple of years.

ASNES: I just hope (UNINTELLIGIBLE) before I retire, so that my IRA is worth something then.

CAFFERTY: In order for us to be able to tell whether that's going to happen, you'll have to tell us how old you are, and I bet you don't want to do that.

(LAUGHTER)

CAFFERTY: How long it is before retirement.

SERWER: We got a few years left here.

CAFFERTY: I know one thing, I don't have that much time left. Mine's around the corner so...

ASNES: Well, you know, I'll tell you this, as my grandmother always said, I'm 21-plus.

CAFFERTY: There you go. And you don't look a day over 23.

Coming up on IN THE MONEY, more brawn for less bucks. Those delicate little SUVs could mean a big tax break for some drivers. We'll debate that issue.

Plus this...

(MUSIC)

CAFFERTY: We'll show you the second best thing about the Super Bowl, and I don't mean the cheerleaders. We're talking about those fascinating television commercials.

Plus, the sounds of silence. Microsoft says its new software will have music pirates singing another tune. Find out how Bill Gates is giving the kissoff to the rip-off artists.

And we'll see whether KMart's financial records are as low-budget as some of the stuff on their shelves. The feds have been crunching Kmart's numbers. We'll tell you what they came up with, next.

(COMMERCIAL BREAK)

CAFFERTY: I like that music. Not bad. You played that in your garage?

SERWER: Yes, I did, on my little (UNINTELLIGIBLE).

CAFFERTY: Seems like no one is middle of the road anymore when it comes to the subject of SUVs. Heating up the dispute, word of a possible big tax break for SUVs, allowing small-business people to write these down to the tune of $75,000. But not everybody thinks that's a great idea, giving some an exemption worth tens of thousands of dollars, but not everyone.

Meantime, there are a few pros in the SUV debate. You're riding high in something that feels like a cross between a tank in your living room, they ride pretty smooth, the big, luxurious ones, a lot of the drivers think that they're safer in an accident, and in some ways I suppose that's true. You've got the bigger vehicle if you run into a smaller car, but the rollover tests indicate that they're not so safe that way, and sometimes if you got to haul a lot of kids and all that, you can save time and money by using one of these. Their gas-guzzling nature, though, is growing more unpopular when this country is re-examining its reliance on foreign oil from the Middle East, and there have been ads on the air that liken owning an SUV to subsidizing terrorism.

That's a bit much, but we'll talk about it. We're going to take this fight into the studio now. It's a street fight. Sticking up for the SUV, Nick Gillespie. He's editor-in-chief of "Reason" magazine. He joins us from Cincinnati. Looks like an SUV kind of guy. And in Washington, speaking out for the people of Hummer Equals Bummer, is Gregg Easterbrook, the senior editor of "The New Republic."

Gregg, let me start with you. I'll grant you, they're tough to see around, some of the drivers seem to be more aggressive when they're in the big cars, but hasn't this thing gone a little bit too far?

GREGG EASTERBROOK, NEW REPUBLIC: Well, it's the SUVs, the large ones, that at least go too far. The key points about them is they're exempt from pollution control rules that apply to regular cars. They're not...

CAFFERTY: But so are diesel trucks.

EASTERBROOK: Sorry?

CAFFERTY: So are diesel trucks, aren't they, I mean?

EASTERBROOK: Yes, but the typical person doesn't drive a diesel truck. And actually, diesel fuel emission rules were just significantly strengthened by the Bush administration.

CAFFERTY: OK.

EASTERBROOK: They're exempt from -- from the air emission rules, they are held to a lower fuel efficiency standard, and they are not anywhere near as safe as regular cars. I think that's the great fallacy of this debate. People buy SUVs thinking, well, I'm going to be in this huge tank, and then if there's a crash, the other guy will get killed. The National Academy of Sciences' report last summer concluded that you are more likely to die inside an SUV than you are inside a regular car.

CAFFERTY: But that includes the rollover statistics, doesn't it?

EASTERBROOK: Yes.

CAFFERTY: The rollover feature of these is a liability. I think everybody will agree to that, that these are -- three times I think the stat is more likely to die in a rollover of an SUV than you are in a rollover of a standard car. However, if I'm driving a Lincoln Navigator and I run into a Ford Taurus, I got a better shot of walking away than the guy in the Taurus, don't I?

EASTERBROOK: Yes, in a head-to-head collision, if you're in a big hunk of metal, you're more likely to survive. But since one-third of highway fatalities happen in rollovers, you end up in your Lincoln Navigator being in greater danger overall than you would be in your Ford Taurus.

CAFFERTY: All right, Nick, let's bring you in here and get you to address the other side of this. The three main criticisms, as Gregg was talking about, they're environmentally not so good. They are unpatriotic, and I want to explore this, this whole idea that if you have an SUV you're subsidizing Osama bin Laden and al Qaeda, and the charge is that SUV owners are somehow mentally unbalanced, that it's a whole machismo thing and they've got to get into these big cars and bully everybody. So pick it up where you like and let us hear your thoughts.

NICK GILLESPIE, EDITOR-IN-CHIEF, REASON MAGAZINE: Well, let me just point out for starters that a couple of months ago this debate was talking about what would Jesus drive? And now we're asking what would Arianna Huffington drive? Which might suggest that we've reached the point of diminishing returns in the value of this conversation.

But let me first -- you know, the charges are that SUVs are environmentally damaging, that they're unpatriotic and they're unsafe. I don't think any of those cases is particularly convincing. While SUVs are not as gas-efficient or as fuel-efficient as other cars, they're still better than a lot of cars that are still on the roads that were made in the 1980s. When we're talking about safety, one of the -- over the past 20 years, the number of light trucks, the class that includes SUVs as well as pickups and minivans, have doubled. The number of those cars on the road have doubled, while the number of fatalities per million vehicles miles driven has dropped to 1.5, which is a record low.

And, in fact, to talk about SUVs on balance, they do worse on rollovers, but overall, according to researchers at Rutgers who take into account the fact that SUVs and light trucks are more popular in rural areas, they've actually estimated that they save about 500 lives a year.

CAFFERTY: Gregg, let me ask you. You're on the record as saying there's something psychologically unbalanced about people who own SUVs. Talk to me about that view of people who buy these vehicles.

EASTERBROOK: Well, the big ones, yes. I think that people who own a Hummer H2 or Ford Excursion, the things that weigh three or more tons, are trying to boast something about the world that I certainly wouldn't want to boast to the world. But let me get back to the safety point Nick is making, because he's not using the data correctly. His argument -- it's certainly true that we all live longer as Americans, but we would live even longer than that if we weren't overweight and we didn't smoke cigarettes. This is the flaw in the way he states the argument. It's true that... GILLESPIE: Wait, wait a minute. Aren't you guys -- I mean, this is all this moralizing stuff, you know, the psychological stuff about trying to tell me I'm too macho to drive this thing, I'm too fat? I mean, shouldn't the markets decide? You know, in the 1970s, the price of oil went up, we started driving smaller cars. If these things are really so bad, people would just stop driving them. I mean, Arianna Huffington sounds like Eva Gabor or something, going on on this issue. I mean, can't people just decide to drive what they want to drive?

ASNES: Every market survey that Detroit has ever done over the past 10 years, there is -- people really don't care about gas mileage, I have to point that out. It's way down.

CAFFERTY: What about letting the market determine what's going on with these things? What's wrong with that approach?

GILLESPIE: Well, if I can actually agree with Gregg on something, and it might be the only thing we agree on, which is the tax incentive thing comes in to play. I think the tax incentives in the country in general are bad because they attempt to do social engineering through the tax cut. And I think that the tax break for massive SUVs for business owners is wrong. I don't think that's the right thing. I don't think it was the right thing to give massive tax breaks and subsidies to various states and federal governments did for electric vehicles, but the electric vehicle experience also shows something, which is that tax breaks at the margin do not change major behaviors in America. They might affect it a little bit, but they're not prime movers.

The reason why SUVs are popular, the reason why minivans are popular and the reason why pickup trucks are popular, is because people like driving them and they like the associations that they have with them.

CAFFERTY: I have to run. I just got one quick question for Gregg. If I bet a ton of money on the Super Bowl this weekend and win, and I want to go out and get me a big old Hummer to drive around on Monday to kind of just feel good about this killing I made on the Super Bowl, should I also be making an appointment with my neighborhood shrink to go in and get a little counseling, do you think?

EASTERBROOK: Let me make the safety point that you cut me off in the middle of. It is true that miles -- that fatalities per mile driven have declined in the last 20 years. They've declined because of air bags, ABS brakes, crumple (ph) zone engineering, because of improvements in the design of cars. At the same time, fatalities from rollovers have increased. So we have two countervailing trends. You have most cars being safer; people buying SUVs that are more dangerous. If it weren't for the SUV fad, fatalities would have declined far more significantly.

CAFFERTY: All right, and now you can maybe answer my question about a Hummer. If I buy a Hummer, you think there is something wrong with me intrinsically, because I decided to go out and spend some inheritance or gambling win on a big, flashy car that makes me feel good?

EASTERBROOK: Yes. I don't think it's just a matter of aesthetics. You buying a Hummer creates a risk to me. If you want to buy the Hummer and put it in your backyard, that would be your business, but if you want to buy the Hummer and run the risk of killing somebody else, then it's my business.

CAFFERTY: All right, that's fair enough. Gregg, I've got to run. Thank you. Senior editor of "The New Republic" in Washington -- "New Republic" magazine in Washington, D.C., and Nick Gillespie, the editor-in-chief of "Reason" magazine in Cincinnati, Ohio.

Still ahead on IN THE MONEY, software that tells music pirates, stick it in your ear. I like that phrase. We'll have the details of a new product from Microsoft.

Also, jacket, tie and cuffs, as in handcuffs. WorldCom's former money man says his old look might not be in fashion when he goes to court.

And for once, some ads you might actually want to watch, a preview of Madison Avenue's Super Bowl commercials, when we come back.

(COMMERCIAL BREAK)

CAFFERTY: All right. We've all parked our SUVs and we're going to continue this program.

We're going to have a regular feature every week called "Stock of the Week." This week, Microsoft is the company. The software giant continuing its efforts to stave off antitrust problems. On Monday, Microsoft and Sun Microsystems entered into an agreement, a court- ordered plan to share some of their technology. But Microsoft's antitrust problems potentially loom large in Europe. This week the company met with EU regulators hoping to avoid the worst of antitrust sanctions that may be pending over there, and Microsoft may be about to establish another monopoly, that's because every music company in the world might soon be using Microsoft's new technology that it claims can help stop CD piracy.

We'll bring in a panel to check on this. I'm not sure this is that big an issue. I don't know whether the music companies are complaining because of downloading or it's just bad music the people aren't buying. But is this the answer to anybody's problems?

TULLY: Jack, my reaction is it's not going to work. People want to download too badly. And kids have found every possible way around all the restrictions and those court orders and the lawsuits, and Napster went out of business...

CAFFERTY: Napster was the one I wasting to think of that they ran out.

TULLY: Yes. And the kids are downloading and burning CDs. And the reason -- the music industry has no one to blame but themselves.

CAFFERTY: How so?

TULLY: Because CDs are outrageously overpriced. You go in, you buy, $16, $18.

SERWER: You know what, Shawn, I mean, these guys have got to get paid. Not the record company executives, they charge too much. But you know, the artists have got to get paid, right? Dave Matthews has got to get paid. And all these people who call it file sharing -- it's file stealing! They're stealing tunes. OK? You're stealing songs.

CAFFERTY: Let's get Kurt Loder into this conversation. He's one of America's most respected music journalists, former "Rolling Stone" editor. For 25 years, though, he's anchored MTV's "Daily News" show and he joins us from over there near Times Square. Kurt, nice to have you with us. What's your take on the downloading issue and whether or not some piece of software is the answer to the music industry's problems on this?

KURT LODER, MTV NEWS ANCHOR: Well, piracy is theft, and file sharing is theft, too, that's true. I think file sharing is a little different. It's sort of like kids, you know, trading tapes 20 years ago.

CAFFERTY: Right. But that was illegal, too, wasn't it, technically?

LODER: It's illegal, too. Piracy is really, really illegal. You know, record companies lose a lot of money on this. The file sharing thing I agree that kids are not going to be stopped from doing this. You'll not put this genie back in the bottle. It's here to stay. And, you know, Microsoft programs, how long does it take them to get the bugs out of these things to begin with? And kids will find their way around it, I think. They'll just hack away around it.

CAFFERTY: What about the complaint that says, you know, the music companies are blaming their lack of sales, lack of revenue, lack of profits on all the downloading when some might say, you know what? The music's not as good as it used to be, and they're not targeting a wide enough audience. Everything seems aimed at the Britney Spears/J. Lo crowd. And maybe the product's not what it ought to be. Is there any validity to that?

LODER: I think there's something to that, too. I think the Britney Spears thing is fading a little bit, although teen pop will always be with us for sure.

CAFFERTY: I'm sorry to hear Britney's fading. Is that true?

LODER: Well, not fading a lot. She'll be with us a while. But I think that's part of it. And the overpriced CDs, that's true. You know, if you pay $18 for a CD -- and what if you paid $18, and like more than half of the tracks are tracks that you don't like, whereas if you go online, you can download maybe the three or four that you do like and save a lot of money. TULLY: Just to refer to what Kurt just said, the idea that the reason these CDs are so expensive, because artists are getting the money that they deserve to get. The -- immediately -- the first thing a record company demands is that the artist assign the copyrights to the record company. And then they don't get any royalties on the records, so they pay back all the marketing expenses, which could be hundreds or thousands of records before they see -- or CDs -- before they see dollar one. So this whole idea about copyright protection, protecting artists is a total ruse.

SERWER: Yes, but so what, are the record companies going to go out of business? I mean, Kurt, what should the record companies do here, or do we even care if they go out of business?

LODER: I think they need a new business model. I think they've got these enormous catalogues; they should open them up, they should find a way to be online themselves, and people should be able to buy this stuff. I think they're really behind the curve here. I think that has to be done pretty quickly if they want to beat this. Napster's gone, but there could be thousands of these file sharing sites showing up.

CAFFERTY: You talk about how expensive CDs are. I'm arguably the oldest guy involved in this conversation. And I can remember going to the record store in Reno, Nevada and paying $5.95 for an album of Beatles songs, for example, back in the '60s, 35 years ago. And I don't know what the rate of inflation is overall in the economy, but if a CD today costs $18, it doesn't seem to me like that's too far out of line, based on what I remember having to pay all those years ago. True or false?

LODER: Well, you know, CDs cost, I don't know, what, $1.50 to make or something? You do have to pay the performer, and there are costs to that; I think they're probably still way overpriced. It seems to me.

ASNES: I don't think they're that overpriced, but I think that when you look at the idea that you have a choice between paying $18 in the store and getting something for free on the net, I mean, the decision is pretty easy to make.

CAFFERTY: It's easy to do, right?

ASNES: Yes.

CAFFERTY: Kurt, you mentioned a new business model. What would it look like, if you could design it?

LODER: I think it seems to me, I'm not an expert on this, but it seems to me they have these vast catalogues of music that people want, going back, you know, 50 years or more. If this could be made available to people, you can't even find all this stuff in record stores, if they could just put it online somehow, I'm sure it would be very complicated, but this would seem to be some sort of answer, and, you know, they could charge for it.

I don't know if this is going up against free file sharing, but it might be a start.

SERWER: You know, Kurt, picking up on something that Jack said, that the music isn't any good now, I mean, you're always tempted to say that as you get older, but I ask you this question -- name me 10 songs from the past year that people will be singing 10 years from now? I mean, the music's no good.

LODER: Well, that's not true. There's always good music around. The music you hear on radio or the music you hear on TV, it's a very small slice of what's going on in music. There's much more music being made. There are a whole bunch of bands coming from Scandinavia now, that I think many of them are really, really good. The Hives are good. (UNINTELLIGIBLE). That's coming up, fabulous. So there is good music being made. You may not hear it all, but, again if you're online, maybe you can hear it. So I think people are exposed to a lot of stuff online, too.

CAFFERTY: Kurt, I appreciate you joining us here. You're on TV in my home a lot. I have got a 17-year-old daughter and she lives with that MTV in her room almost continuously. Nice to have you with us. Thank you. Kurt Loder of MTV.

Still ahead on IN THE MONEY, the feds want to know if Kmart is discounting the truth? They're wrapping up a look at the company's books. We'll tell you what they think they might have found, coming up.

Plus, cuff links. Real cuff links. WorldCom's former CFO thinks some shots of him in handcuffs might send the wrong impression. Different from the kinds of shots that we get of other criminal suspects when they are arrested and put in handcuffs. That's coming up on "Scandal Watch."

And find out...

(CROSSTALK)

CAFFERTY: Find out what Super Bowl ads might be good for something more than grabbing a snack. You might want to stay in the room this year. Madison Avenue is going to try real hard to make you stay out of the bathroom during the ball game. Back after this.

(COMMERCIAL BREAK)

CAFFERTY: A lot of music on this program.

SERWER: Yes.

CAFFERTY: Tough to talk money these days without mentioning all the corporate scandals and weasels that are out there. This week full of updates for our "Scandal Watch" segment, which we'll do every week. Former WorldCom Chief Financial Officer Scott Sullivan suffered a legal setback on Tuesday. A federal judge shot down Sullivan's whining request to move his trial from Manhattan. Sullivan says he won't be able to get a fair trial because of all the widespread news reports showing the feds taking him away in handcuffs, just like they would if he'd been a suspect in the 7-Eleven robbery. This is what they do with criminal suspects when they arrest them; they put them in handcuffs, this is a standard procedure.

The kiss-and-tell insider trading case heating up. The feds may soon charge Lehman Brothers analyst Holly Becker with tipping off her trader husband about a negative report that Lehman made about Amazon stack back in the year 2000.

Kmart's filed for bankruptcy -- in fact, they've gone bankrupt. Now, prosecutors may hit some former Kmart executives with criminal charges. A federal grand jury is focusing on about $29 million worth of loans that Kmart gave two dozen executives, don't you know, just as the company was going under. Most of the men who got the loans have left the company since it filed for bankruptcy last year.

I thought we were supposed to have solved all these corporate malfeasance and competence problems with new legislation. What's going on?

TULLY: The funniest one is this whole SEC thing, because it's a very secretive hedge fund, and it turns out that Steve Cohen (ph), who runs the fund, was very influenced by his psychiatrist, his shrink, who exorcised his demons and made him into a great trader, and they've written a book together.

CAFFERTY: Oh, that's good. Andy.

SERWER: Listen, I am concerned about these perp walks for these executives. I think they're terrible. Don't people know those are very expensive French cuffs that some of those executives were -- it might hurt them, it might ruin them. Feed them to the lions. I mean, come on.

(CROSSTALK)

CAFFERTY: Marion.

ASNES: I want to go work for Kmart so that I can get a $5 million retention loan and then leave the company. I just, you know, that would do wonders for me!

CAFFERTY: If somebody loaned me $5 million, I'd be out of CNN before this program was over.

SERWER: You do this for the love.

CAFFERTY: Yes, that's true.

Time for us to pay the rent. We're going to take a break and watch some of these here commercials so that AOL Time Warner can trudge ahead in this world. We'll be back, more after the ads about the ads. Madison Avenue making the Super Bowl commercials as much fun in some cases as the game itself. Stick around. See where the ad guys managed to do the impossible yet again. My hunch is they have.

We'll show you a fast food joint where they're making burgers without a side order of legal problems. As McDonald's wraps up a court fight, check out our "Web Site of the Week." Stay with us.

(COMMERCIAL BREAK)

CAFFERTY: The Oakland Raiders set to take on the Tampa Bay Buccaneers in Super Bowl XXXVII at Qualcomm Stadium in San Diego -- I missed -- a number of subplots to talk about as we're getting ready for the big game, beginning with Tampa Bay coach Jon Gruden. At this time a year ago, Gruden was the coach of the Raiders. He jumped ship when Tampa Bay offered him a bunch of bucks, and a better climate. And a lot of the Raiders are still steamed. They feel betrayed by his leaving. He's a popular coach with his players.

Then you have the wild, rowdy and sometimes violent Raider fans. They call themselves Raider Nation. Mutants would be another good word. Every time these Raider fans go to San Diego during the regular season, it seems there's always trouble. The stadium routinely cutting back on alcohol sales during Raider-Charger games. But that sometimes doesn't help. In October 2000, a Raiders fan stabbed a Chargers fan outside the stadium. The victim survived, but just barely.

And then there is that other Super Bowl contest, the one where nobody throws the ball, everybody instead making a pitch. ABC is asking $2.2 million for one 30-second commercial during Sunday's game. A few companies are gambling big bucks and bright ideas that they've got the right way to sell their products. Ideas merchandised to one of the largest TV audiences of the entire year. H&R Block has Willie Nelson singing its tune. Watch this.

(BEGIN VIDEO CLIP, H&R BLOCK COMMERCIAL)

UNIDENTIFIED MALE: We want you to be a spokesperson for smoothy shaving cream. You can make huge money.

UNIDENTIFIED FEMALE: It's not about the money. This is Willie Nelson.

UNIDENTIFIED MALE: Willie, we've got a small problem. You made a little mistake on your taxes. You owe $30 million.

WILLIE NELSON, MUSICIAN: I what?

UNIDENTIFIED FEMALE: Action!

NELSON: This play calls for smoothie.

UNIDENTIFIED MALE: Cut!

NELSON: Have a smooth move!

UNIDENTIFIED MALE: Cut. Willie, make a smooth move. Action!

NELSON: My face is burning!

UNIDENTIFIED MALE: Don't get bad advice. At H&R Block...

(END VIDEO CLIP)

CAFFERTY: Imagine, an H&R Block tax commercial with a sense of humor. Comments from the panel? What's your favorite Super Bowl ad, Shawn?

TULLY: Well, I'll pick that one right there. That's pretty good.

(CROSSTALK)

TULLY: You'd never know it's a tax commercial when it first starts. And look at Willie Nelson mocking his own tax problems. It certainly takes a certain amount of chutzpah to do that.

(CROSSTALK)

ASNES: Well, it's not Willie. But I do want to point out that he actually paid $16.5 million to the feds to clear up his tax problems, which is a lot of -- you know, he should work at Kmart!

But my favorite is the Osbournes to the Osmonds.

CAFFERTY: The Pepsi commercial. We'll look at that.

ASNES: Oh, that's unbelievable.

CAFFERTY: You have a favorite?

SERWER: Yes, going all the way back, remember the Apple one? 1984, Macintosh, 1984, the woman running. They only ran that commercial one time, and that's what really started this whole, you got to make a big, huge splashy commercials for the Super Bowl.

CAFFERTY: All right, Barbara Lippert is an ad critic for "Ad Week" magazine. She's going to join us as we talk about the psychology of million dollar, single 30-second spots. And Barbara, it's nice to have you with us. Was Macintosh the start of this cachet that suddenly these commercials have?

BARBARA LIPPERT, AD WEEK: Yes. It was almost 20 years ago, and the thing was, it was introducing a revolutionary product. It was introducing the Macintosh. So it could be huge. It could use Ridley Scott, it could live up to all the claims that 1984 was not going to be like "1984." You know, the problem is, if you're selling gum or soda, you sort of can't make those extravagant claims and change the world.

CAFFERTY: But in the year 2000, they had commercials on for something else that was revolutionary and brand new. There were 13 commercials during the Super Bowl for the dot-com companies. The Internet was brand new. That didn't work out so well, didn't it?

LIPPERT: No. By the following year, only three of those companies were alive. All of those companies gambled their whole budget to be on the Super Bowl, and then went out of business. CAFFERTY: Wow. Who's the champion? As you look back through the years of Super Bowl commercials, who does the best job of using that very expensive time to get their message out?

LIPPERT: Well, the Apple one is always, you know, it's best of the century, really. And then they followed it the next year with a bunch of lemmings, which was the dog of all time. So you can go from the highs to the lows.

So one -- E-trade, which is not among us this year, the one where the guy -- the monkey was surveying all of the dead dot-com landscapes? That was absolutely brilliant. And another one for Monster.com, where the kids were saying, I want to be in middle management. I want to file, file, file! Talking about what jobs they wanted when they grew up was another brilliant one.

CAFFERTY: All right. Let's take a look. This is another. We were able to get a couple of the commercials that you'll see during the game tomorrow. You're viewing this on Saturday afternoon. Here's Pepsi's offering this year. Check this out.

(BEGIN VIDEO CLIP, PEPSI COMMERCIAL)

(MUSIC)

OZZY OSBOURNE, MUSICIAN: Sharon! Sharon, the kids have turned into the Osmonds!

UNIDENTIFIED FEMALE: Oh, dear, dear, dear, go back to sleep!

UNIDENTIFIED MALE: Like twist, Pepsi twist...

(END VIDEO CLIP)

LIPPERT: You cut the beginning, but the kids come in, they're acting like pod people, Kelly and Jack, and he's fussing with the garbage, which was what happened with the show, they turn into the Osmonds, and that's funny enough, but then the kicker with Florence Henderson, you know, really has (UNINTELLIGIBLE).

CAFFERTY: It's a follow-up, too, to the one that had Halle Berry, and that's not really Halle Berry, that's Barry Bostwick. And Barry Bostwick comes on, and says, "what's a Barry Bostwick?" Very clever stuff.

What about production costs? I mean, you don't hire the Osmonds and what's his face, and the Osbournes and all of these people. That has to cost some money to do these? Don't they have to pay the big bucks to get these celebrities?

LIPPERT: They pay big bucks. And sometimes it's not worth it. I mean, there is a Haines commercial, it has Jackie Chan and Michael Jordan. And they don't interact, because they shot them on different days. And Jackie Chan just jumps around like a demented kind of cat, scratching, and there's no story, there is no build, there is no surprise, whereas a tiny little commercial like the Trident commercial using a squirrel on the fifth dentist who did not recommend Trident, it probably cost, you know, an eighth of that and is going to do very well.

CAFFERTY: So it's not necessarily true that a celebrity is going to carry the day for your commercial? It's the idea and the way you communicate the idea?

LIPPERT: Absolutely -- and pets are always big. Animals are big. And as one trainer said, they don't cost nearly as much as Britney Spears.

CAFFERTY: How high is up? The first Super Bowl commercial, $47,000, that was more years ago than I care to remember. Now they're $2.2 million. Is there some kind of an upper limit on this stuff, do you think?

LIPPERT: Well, last year it was down to $1.7 to $1.9. So it's back up again this year, which is great for advertising, because it's been a really savage year. It's been a terrible year. So I think it will continue to go up.

CAFFERTY: The falloff on advertising, I suppose to a small degree, could be related to the events of September 11. I remember the tone of the commercials in the Super Bowl that January following September 11. Much more somber. Much more serious. As you might expect. How tough is it in terms of lead time for these companies to make sure they've got a handle on what the right mood of the country's likely to be when they go into production on this?

LIPPERT: Well, now they're very worried that war will break out in the middle of the Super Bowl and they have to have all kinds of contingency plans. But yes, last year, it was much more muted and patriotic. People were scared to celebrate. You know, there was one black humored commercial, and everyone thought that was in terrible taste. This year, you know, the same company did the owner showing up in his underpants, because he's so dedicated to making Quizno subway sandwiches. At least they cover his ass with a big bun (UNINTELLIGIBLE).

(CROSSTALK)

LIPPERT: Yes. It's back to the basics and the gross jokes that go over with a big roomfuls of drunk people watching.

CAFFERTY: Have you seen all the ads for this year?

LIPPERT: I've seen all of them, except Budweiser, which does not release them. And Budweiser is usually the most talked about on Monday morning.

CAFFERTY: They do consistently an outstanding job. Barbara, thanks for kicking this around with us on IN THE MONEY. I appreciate you being part of the broadcast.

LIPPERT: Thank you.

CAFFERTY: Barbara Lippert, ad critic at "Ad Week" magazine.

Still ahead, with McDonald's coming off a court fight, we'll put you behind the counter in a virtual fast food joint. Just don't come whining to us about wanting minimum wage. You'll have to take that up with somebody else. Back after this.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

MICHAEL CARTY: The consumer's going to continue to be strong this year, and possibly a lot better, despite the fact that unemployment might rise. I think this is also going to be a good year for investors. So consumer -- or money-conscious consumers should really start looking about where they should be putting their money.

STEPHEN PORPORA: The markets technically is at a level where I'm not -- I don't think we have a lot of down side at this point, but what we do need is, we need a significant shot of very good news to get this market moving through the current trading pattern that it's in.

MARY DAVIS: We're expecting a resolution of the Gulf crisis by early in the second quarter, and that in turn is going to allow a rebound in the equity markets and quite a strong rally across all of them, in particularly Nasdaq, and allow oil prices to drop back to about $20 a barrel, (UNINTELLIGIBLE).

(END VIDEOTAPE)

(COMMERCIAL BREAK)

CAFFERTY: Remember the people who sued McDonald's because they said the fast food chain was responsible for making kids fat? This week, a federal judge threw that case out, rightfully so, and nobody forced anybody to go in there and eat. But the next fat based lawsuit is probably not too far away. And that's where the "Web Site of the Week" comes in.

If you want to open a lawyer-proof burger joint, we've got the answer. You're going to have to do it online, though. This is Burger Blitz. You can go here, grill as many cheeseburgers, bacon, eggs, anything you want, with no fear of a visit from the food police or the lawyers. If you have to be healthy even in the virtual world, you can make a veggie burger too, but why would you want to? Get your shake and large-sized everything!

Here's the Web site address. Go there and have yourself a little party. The burger making time-wasting revelry is courtesy of our good buddy Allen Wastler, a friend of mine, who is also the managing editor of Money.com. And what we'll do is we'll have one of these a week. And if you have one that you think the rest of the viewers might enjoy, well, you can share.

At the top of the program, I mentioned it's our first IN THE MONEY program. If you like what you see, if you want to recommend a "Web Site of the Week," if you have comments, drop us a line and tell us what's on your mind. Keep in mind, though, when you do that we do have the IN THE MONEY Rules Committee and public relations squad standing by to go through the e-mail. And if they don't like what it is you send, they'll be coming out to the house to discuss the contents of the letter with you.

The e-mail address is inthemoney -- that's one word -- @cnn.com. We actually did get a letter already. Rod wrote to us this morning, saying: "Hi, Jack, wondering if you were going to have the sharp wit and answers on the new show, or is it going to be like all the other boring money shows?" We're not showing this to Lou Dobbs, by the way. "I realize the markets are bad, but we should be able to have a laugh, and I think they're doing the right thing by putting you on as host. Good luck. I'll be watching."

We'll try. Thank you.

That's it for the first edition of IN THE MONEY. I want to thank our panelists, Marion Asnes of "Money" magazine, my friend Andy Serwer from "Fortune" magazine, and Shawn Tully.

I'm Jack Cafferty. See you next time.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com





Tax Break for SUV Owners?; A Look at Super Bowl Ads>