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CNN IN THE MONEY

War Conditions which Create Atrocities; Reducing Our Oil Appetite; Porn Industry Guards Against STDs

Aired May 15, 2004 - 13:00   ET

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


JACK CAFFERTY, CNN ANCHOR: Welcome to the program. I'm Jack Cafferty. Coming up today on IN THE MONEY, thinking the unthinkable. We'll look at the mindset behind the alleged prisoner abuse in Iraq, see what causes it and how it can be stopped.
Plus zero gallons to the mile. Gas prices way up, supplies getting tighter. We'll check on whether America has a plan for the day when the pump runs dry.

And bodywork. The porn business can be a matter of life and death literally for actors. Find out how one health worker is trying to prove that sexy and safe can coexist.

Joining me today on IN THE MONEY, the usual sidekicks on the program, CNN correspondent Susan Lisovicz, "Fortune" magazine editor- at-large Andy Serwer.

Red flags up at the White House as the president's approval rating dropped to the lowest level of his presidency. Anything below 50 percent for an incumbent is considered a danger sign in an election year. President Bush is at 46 percent. What do you think?

ANDY SERWER, EDITOR-AT-LARGE, "FORTUNE": Well. it's early, first of all. I mean, let's do that. But you know, the prison scandal has had a profound effect on America, the Nicholas Berg beheading notwithstanding. The economy is improving, though, and I think that John Kerry has not done a very good job of capitalizing on all of this. I think he needs to take a page out of Ringo Starr's book and start acting naturally.

(LAUGHTER)

SERWER: I mean, something's wrong, he should be taking advantage of this.

SUSAN LISOVICZ, CNN FINANCIAL NEWS CORRESPONDENT: Ringo Starr, by the way, thanks you for that little...

SERWER: You're welcome.

LISOVICZ: For that compliment. You know, the thing is is that the economy has been showing signs of improvement, but there's a lot of fear right now. You've been seeing it in the stock market. Inflation is rearing its ugly head. And it's not only happening with energy, it's happening with dairy prices, it's happening with beef, chicken, other commodity prices like steel. Wal-Mart, this week, just a few weeks ago said with the price of oil, it takes out $7 a week in disposable income. And guess what, that's going to slow down the economy. So that's a problem for the president as well.

CAFFERTY: Well, the question I have is all of this stuff about the economy, inflation and interest rates and the stock market, and the war in Iraq and the prisoner abuse and the beheading. Why isn't Kerry doing any better? He's not exactly lighting it up.

SERWER: You know what I think? I think there's going to be something that happens in October, towards November, like this prison scandal, that's going to make the election, throw it one way or the other. I mean, I really think things are pretty close. And you can see these things are so polarizing. I think it's going to be something like that is going to call it.

LISOVICZ: And historically, these races aren't tight when it comes to an incumbent, and we are a long ways off.

CAFFERTY: All right. Those prison pictures from Iraq haven't lost any of their power to fire up debate and outrage, even now after we've lived with them for a couple of weeks. And while the images of U.S. soldiers allegedly abusing Iraqi prisoners show us how the inmates were handled or mishandled as the case may be, they don't tell us why it happened. For some perspective on that, we're joined by Robert Jay Lifton, he's a visiting professor of psychiatry at Harvard Medical School. His latest book is called "Superpower Syndrome: America's Apocalyptic Confrontation with the World."

Sir, it is a pleasure to have you on the program. What takes an ordinary, well-intentioned, well-trained soldier and turns him into somebody who is willing to abuse or torture a fellow human being that is in his custody?

ROBERT JAY LIFTON, RVARD MEDICAL SCHOOL: The first thing to say is that they are ordinary soldiers. You don't have to be exceptional to do this. And what happens is that the environment he's part of becomes what I call an atrocity-producing situation, where the normal expected thing in that environment is to get involved in this abusive behavior.

CAFFERTY: But is that really true? It's not normal or expected for the vast majority of kids that are serving in the Iraq theater.

LIFTON: No.

CAFFERTY: Apparently it was just a small group that fell victim to this kind of behavior. What is it that makes them vulnerable and the rest of the people resistant?

LIFTON: What makes them vulnerable is the environment they are put in. They don't have to be exceptional. If the normal activity in that environment is to abuse prisoners, and there's some message from above that that's expected, whether it's specific or nonspecific, then ordinary kids can join in that abuse. And in fact that group process, it's a group process, not an individual process, and that group process can become so strong that it becomes very hard to buck it. And it takes the exceptional young person, and there are some, to resist it.

LISOVICZ: And in fact in this horrific incident that we've been seeing, Major (sic) Taguba actually cited three ordinary soldiers who refused to take part, even at the risk of ridicule and perhaps punishment. These are ordinary soldiers. And I've read research that has showed that psychiatrists say those type of people not only have a strong moral compass, but past experiences with conformity. Can you expand on that, Professor?

LIFTON: Yes. You know, I interviewed at length a man who had been at My Lai in the Vietnam War. My Lai was the massacre of more than 400 people. And he had refused to fire and very pointedly placed his gun on the ground to show he wasn't firing. He was fearful that the group would take action against him. And when I probed his reasons for that strength of resistance, it had to do with first a kind of religious conscience from early life. Second, a sense of being a loner where he wasn't so influenced by a group. And third, most interesting, in his case most important, a kind of military idealism. He loved the military, and was upset at this behavior that he considered unworthy of a military he loved. So all these factors can enter into the capacity to resist. He was unusual then, and these men, who are admirable, were unusual in this case. But you can find such people, and you want to study and understand them.

SERWER: Robert, let me ask you a two-part question. The first one is kind of psychology 101 maybe in one of your classes, and that is why is it that mob mentality is always bad? Why is it when you get a group of people together they seem to tend towards a negative action? Is that true? And number two, do you think soldiers should be trained in order to avoid these type of things like My Lai or the prison in Iraq?

LIFTON: Group action doesn't have to be negative, but when it is negative, it can be much more extreme than any individual would perform on his own. And in this case, it becomes negative when it has a signal or instructions from above. It's like three layers. The dirty work is done at the foot soldier level. The military intelligence officers are pressing for softening up processes, sometimes with instructions, sometimes with just more vague indications. And above them are the military planners and the high- ranking officers who are hungry for information and may tend to exaggerate the importance of the interrogation process.

Training would help, but it wouldn't prevent the existence of this kind of atrocity-producing situation. You are likely to get it in a counterinsurgency war such as this where there is hostility from the population and where there is confusion about the mission and about one's purpose and about what's going on there. That was the situation in Vietnam, although a very different kind of environment. So, yes, the training is desirable, but when you train people to disobey illegal orders, can they resist the pressures of a kind that we're encountering here? It's often unlikely that they can.

CAFFERTY: Is this in some ways a search for some sort of idealism? Aren't we talking about human behavior that's as old as mankind itself? The victors tend to impose their will on the vanquished, always have, probably always will. You can talk about degrees and propriety and the morality of it, but in fact the winners tend to push the losers around in one way or another.

LIFTON: What you can say is that, if you want to talk about human nature or human capacities, human beings can go either way. They don't have to do these things. But they are capable of doing these things. They are also capable of more decent behavior. So much depends upon the kind of structure you put them in. The structure, the environment, in this case, the atrocity-producing situation is the key factor because human beings are capable of doing either.

CAFFERTY: All right, Professor. We're going to have to leave it there. It's fascinating stuff. I appreciate you joining us. Robert Jay Lifton, visiting professor of psychiatry at Harvard Medical School. Thank you very much

Coming up next on IN THE MONEY, a lawn ornament with tires. Gasoline at record highs, supplies aren't looking very healthy either. See if that thing in your driveway is turning into a three-ton paperweight.

Also ahead, Citigroup foots the bill, find out how much the bank could wind up paying, it's in the billions, for claims that it should have shut up -- or it should shut up when it should have spoken up.

And you can't eat a sheepskin. College kids getting ready to pick up their diplomas, we'll have some tips on surviving life after graduation. That's when the real fun begins.

(COMMERCIAL BREAK)

CAFFERTY: It's getting more and more painful to pull out your wallet at the gas pump these days. Don't have to tell you that if you drive. Crude oil prices over $41 a barrel at one point this last week. That's the highest they've been in a decade. Our next guest says forget about the price. That's not the problem. The real problem is where we're using so much oil, so fast that we're going to run out of crude oil altogether one day. Paul Roberts is the author of the new book "The End of Oil." He also writes about energy issues for "Harper's" magazine.

Mr. Roberts, nice to have with us. Welcome.

: Good to be here, thanks.

CAFFERTY: What happens when there is no more? It doesn't sound to me in the reading I've done like there's been much of an effort made to make contingency plans for getting around some other way than filling up the fliver (ph) with gasoline.

PAUL ROBERTS, AUTHOR, "THE END OF OIL": Well, this really is an example of policy failure. This administration has pretty steadily refused to acknowledge that there is a problem in long-term energy supply and oil in particular. It's refused to make any effort to reduce oil consumption in this country. It's refused to look at alternatives. CAFFERTY: Let me just interrupt here. Let's don't lay it all on this administration. We've been using more oil than we probably should have since the 1973 Arab oil embargo and maybe even before that. So we have got a lot of administrations that have failed energy policies. It's not just the Bush administration.

ROBERTS: You're absolutely right. It's a U.S. obsession with supply. And it really has to move to a new focus on demand. Right now, though, we are hoping that by stabilizing the Middle East we can ensure U.S. supply. And I think that's really blowing up in our faces. What it means is that we need to take another look at demand. And we've done that before in the '70s and early '80s. We took a hard look at demand and we were able to cut it significantly. Whether we're going to be able to do that again is an open question.

SERWER: Paul, don't you think that -- and this is sort of a pet peeve of mine, to follow up on what Jack was saying. We've been talking about this for decades. I really think the time has come for us to talk seriously about this, and I actually think something is going to happen because what's to stop the terrorists from continuing to target oil supply and production in the Middle East? I really think we're going to be getting off the dime here. What specifically can we do now to reduce our dependence on foreign oil, I mean, once and for all, to move.

ROBERTS: Well, you've laid out basically one scenario there. And that's the bad news scenario, which is we get some huge disruption which forces us to choose quickly some new energy technology. And that wouldn't be the best scenario. The happier scenario is one that we may be in the middle of right now, which is high oil prices, steadily prod the economy to get smarter in terms of how we use our energy.

We become more energy efficient, maybe adopting technologies like hybrid cars, for example. We start investigating more seriously alternative technologies. It's a gradual process that's incremental, it's market-driven because the market is responding in the way that markets do when prices get high. That's the good news. The bad news is the market is so tight right now and its spare capacity is so thin that if there is a disruption, and a disruption is more likely, we're going to see a price spike that's going to force our hand. And at that point, it's tough to know what any administration could do.

LISOVICZ: You know, But Paul, even if we start to get reality about oil and its dwindling supplies, alternatives are not so readily available, either. There's a front page story in "The Wall Street Journal" on Friday, the headline reads, "Fears of Terrorism Crush Plans for Liquefied Gas Terminals." Community after community all over the United States is voting down these facilities because they fear that their communities will be targeted. So that's another problem.

ROBERTS: Absolutely. I mean, natural gas would in theory be a perfect field for America to move to. It's cleaner. It has a variety of different uses. You can even make it into a liquid fuel. At the same time, as you point out, communities don't want these gigantic re- gasfication plants in their midst. They view them as being dangerous. They view as effectively bombs and terrorist targets.

The fact of the matter is that gasoline is far more flammable than liquid natural gas. We've been using it for a century, we're used to it. But you raise a good point. Our system is vulnerable to disruption, to terrorist attack and at the same time, the alternatives aren't ready for prime-time.

We've hear a lot about, well, let's move to wind power, let's move to hydrogen fuel cells. Fuel cells is a great example of a technology that in theory could be a big part of the next energy mix. But it's decades away from being something that you and I can afford. Until then we need some kind of a stopgap, a bridging technology. And that's why I think you're going to find more and more interest in things like these gas-electric hybrids.

CAFFERTY: Yes, Ford Motor Company I think is ready to come out with some sort of gas-electric hybrid SUV.

ROBERTS: That's right.

CAFFERTY: Let me ask you though about the paradox here. We talk about energy policy and we talk about political will and we talk about terrorism. This is America. I look out the window and I see Humvees driving down 6th Avenue in Manhattan followed by Chevy Suburbans, followed by huge pickup trucks and campers and Winnebagos and on and on and on in the middle of New York City, where none of this stuff is necessary and/or usable.

The fact of the matter is we like big cars. We like to go fast. We like to live like we like to live and we don't want to be told by the government how we're supposed to live. So how do you reconcile the appetite and the lifestyle of this country with the fact that we're running headlong into a huge crisis? I mean, if the government steps in and says, you can't do this anymore, we're going to vote them out of office and get somebody else in there probably.

ROBERTS: Well, John Kerry found that out. Clearly this country, many Americans feel they have a constitutional right to cheap gasoline and big cars. So maybe Ford's approach is the best thing, you have a hybrid SUV. I think no politician is eager to jump into, you know, the energy question for consumers. It's been a tough issue ever since the '70s.

I think what has to happen is -- I think high prices have to do a lot of the talking for politicians. And I think that people who have Hummers and big SUVs and just have to drive long distances are already coming to that conclusion.

Again, though, I think we need to have from the top, and it doesn't matter which party is in power, it needs to come from the top that we need to start having a talk, a conversation about energy. It needs to be not taboo to discuss the possibility that maybe we did drive too much, maybe our cars are too big, maybe our reliance on an obsolete technology is something we need to address.

Once that starts happening, and it may be happening right now, I think you can make progress. But again, you know, we spent so much time not talking about it that it's -- you know, it's no surprise that consumers are a little leery of making any change.

CAFFERTY: We have no more time to talk about it now either.

(LAUGHTER)

CAFFERTY: Thank you, Paul, for joining us. Paul Roberts wrote "The End of Oil." What you are talking about in terms of the hybrid SUVs, I read this morning Ford is only going to make 20,000 of these things, but there are already requests for 30,000. So your suggestion that something is already happening is I think probably a valid one. Thanks for joining us. We'll do this again in a couple of months, see where we're at.

More ahead on IN THE MONEY, as we continue, coming up after the break, Citigroup antes up a few billion dollars to kill off claims that it held out on WorldCom investors. We'll tell you how Wall Street is taking that news.

And later, the riskiest work you can do with your clothes off, besides IN THE MONEY. No, we're fully dressed here. Meet a health care expert who's trying to get the bugs out of the pornography business.

And the exam comes after you graduate. We'll ask an expert how kids just out of college can join the real world without getting eaten alive. Listen up, kids.

(COMMERCIAL BREAK)

LISOVICZ: Now let's look at the week's top stories in our "Money Minute." Higher prices for oil imports helped boost the U.S. trade deficit to a record $46 billion in March. But the news does have a silver lining. Many economists say it proves our economy is shifting into high gear as U.S. businesses buy more foreign supplies and consumers spend more on products made overseas.

Delta is the latest major airline to warn it may have to file for bankruptcy. The company may be trying to put some pressure on its pilots who are currently negotiating a new contract. But Delta shares are trading near 24-year lows.

And The Gap clothing store chain made the unusual move of documenting abuses at hundreds of its factories worldwide. The store released its first ever social responsibility report to highlight its efforts to improve working conditions for employees overseas. The company says it has already purged 16 percent of the factories it inspect from its list of suitable contractors.

SERWER: Another big company ate some crow this week when Citigroup agreed to pay more than $2.5 billion to settle a class action suit brought by holders of WorldCom stock. Citi admitted no wrongdoing, of course, but that's how these things go. Those shareholders accused Citigroup of pushing WorldCom stock even when they knew it was worthless. Imagine that. Remember the Jack Grubman scandal? Citigroup is also setting aside $5 billion to cover any future litigation costs.

Like the markets in general, Citi has cooled off considerably in the last few months. But the stock is still up about 20 percent from where it was this time last year. That makes Citigroup our "Stock of the Week."

I'll tell you something about this company. Everything about it is big: $49 million a day in profits last year; $80 billion in revenues; over a trillion dollars in assets. But one other big thing, they've got about $10 billion that they've either paid or set aside as reserves for all this Wall Street mess.

LISOVICZ: But no admission of wrongdoing. And Jack Grubman, the star -- one-time star telecom analyst for Salomon Smith Barney, a unit of Citi, he may be disgraced, but the guy who was running the show is still there as chairman, and that is Sandy Weill.

CAFFERTY: Yes, that, if I'm a potential investor, "Stock of the Week," I want to know whether any of this has had any impact on the way they do business or whether they are still subscribing to some of the same practices because they have to put $10 billion in a separate fund to settle wrongdoing that they've been involved in.

LISOVICZ: Well, as big as Citi is and with all the revenue and profits that you were talking about, Andy, they're still going to have a charge for future earnings because of these...

SERWER: Yes, and there's also an SEC investigation as well. And you know, when you talk -- we've been talking a lot about groupthink and culture and mindset, and you know, this is part of it. Everyone on Wall Street got caught up in it. I don't think it has to do anything with Citigroup. Sandy Weill ran the company, he's now chairman. Chuck Prince has been brought in, he's now the CEO.

One thing about the stock though, Jack, is it's actually pretty cheap on an earnings basis. Not an expensive stock, you can see with all this cloud hanging over its head, that probably would make sense. And over time the stock has performed very, very well for investors over five years, 10 years. It's such a behemoth and it really sort of reflects how important the financial part of our economy is, isn't it?

LISOVICZ: Well, yes. And I think the changes have been made, but the fact is again, Sandy Weil is still at the top of the list there at Citi. And he was involved with Jack Grubman as well. One of the most notorious instances of questionable business ethics is pressuring Jack Grubman to change his rating on AT&T stock.

SERWER: And then he got involved in nursery schools.

CAFFERTY: I was going to say, some of that was -- had to do with getting a kid into private school...

(CROSSTALK)

SERWER: But nobody did anything wrong, Susan, to reiterate your point. CAFFERTY: We saw nothing, we did nothing, we heard nothing. But we have $10 billion over here just in case.

SERWER: Right.

CAFFERTY: Still ahead on IN THE MONEY as we continue, a red alert for blue movies: an AIDS outbreak in the porn industry. We'll talk to a former adult film star who now works to keep porn actors safe.

And it's college graduation season, which means it's time for tens of thousands of 21-year-olds to start learning about the real world. We'll have some essential tips for the cap and gown crowd.

(COMMERCIAL BREAK)

BETTY NGUYEN, CNN ANCHOR: More of IN THE MONEY in a moment. But first here's what's happening.

At least three people are dead outside Denver, Colorado, after part of a highway overpass collapsed. A spokesman for the Jefferson County Sheriff's Office says a girder fell on a car. You can see it here. The accident happened in a construction area on Interstate 70. That's the main route from Denver west to the Rocky Mountains. Traffic is shut down in the eastbound lane.

An Israeli helicopter fired on the home of an Islamic Jihad leader in southern Gaza. Witnesses say the target, Mohammed Sheik Khalil, wasn't there, but three neighbors were injured. Israel's military says the target was an explosives lab. There was a similar strike earlier on Islamic Jihad office in Gaza City.

The World Cup soccer finals for 2010 go to South Africa. People in the streets of Johannesburg watching the announcement screamed and jumped with joy at today's decision. It's the first time an African nation has been picked to host the World Cup.

That is the latest. Now back to IN THE MONEY.

SERWER: Porn stars will show you everything, except what it's really like to be a porn star. The business is all about fantasy, but the reality is, without the right precautions, porn films can be dangerous for the people on camera. California's multibillion-dollar adult film industry just ended a voluntary shutdown declared after an HIV outbreak last month. Five actors tested positive for the virus that causes AIDS. Dr. Sharon Mitchell is a former adult film actress who now runs the Adult Industry Medical Health Care Foundation. And she joins us from Los Angeles.

Welcome, Sharon.

SHARON MITCHELL, ADULT INDUSTRY MEDICAL HEALTH CARE FOUNDATION: Thank you.

SERWER: Can you give us the latest on this situation. I guess the industry is back at work? MITCHELL: Well, some of the industry is back to work. It's going to take a little bit of time for people to get up to speed and start shooting again. We did have almost 60 people on quarantine and so far we've released about 13 people. And they are ready to go back to work. But remember, we had three related cases to our indexed patient here. So it was a total of four related cases, and we've got to release people incrementally back into the community to work.

LISOVICZ: Dr. Mitchell, you are a life-saver to many people in the porn industry. Tell me, is there a lot of infections, disease? Just get us up to speed. How are -- are people educated as to the dangers of the industry?

MITCHELL: Actually, this population gets a tremendous amount of preventive education because the Adult Industry Medical Health Care foundation, we screen 1200 actors per month, that's the entire population, and we screen them for four different diseases every month: HIV, Chlamydia, gonorrhea and syphilis. And because we see them every month we get to update them on lots of sexually transmitted diseases. And then every six months each actor or actress gets a complete physical checkup for diseases we can't see or detect by blood screenings. So I would say your average porn star knows much more than a regular M.D. about sexually transmitted diseases because that's their job.

CAFFERTY: Dr. Mitchell, how did you go from being an actress in porn films to doing what you do now?

MITCHELL: Well, I had a very long, enjoyable career in the adult entertainment film industry for about 12 years. And one day I had just had enough and I was actually stalked by a crazed fan and I suffered an attack on my life. And I thought to myself, it's time to change something here. So I went to school, and then in 1998, there was an HIV outbreak in the porn business, and I realized a lot of the people that I had been -- worked with as actors and actresses were getting HIV. And I was asked to step in and start a monitoring system for this population. And I founded the AIM Health Care.

SERWER: Doctor, I don't watch a lot of porn films, and I'd like to ask you a question, do they practice safe sex? Do they use condoms?

MITCHELL: Well, we take surveys every month and one of the surveys that we do take is condom use. How many actresses and actors are non-condom and how many use condoms. And only 17 percent of the talent uses condoms. And this is an economic issue because the films that are non-condom are picked up more readily for distribution. And so the producers and directors produce more without condoms. Therefore, the actors and actresses get paid a little bit more not to use condoms.

SERWER: Risky business, then.

MITCHELL: Yes, it is. It's very closely monitored, but the tests are only as good as the day they are drawn and the rates of disease other than HIV are very low. They are at 2.8 percent, which is roughly 10 percent lower than the general population. But still, it's not 0 percent.

LISOVICZ: Dr. Mitchell, your story has a happy ending. You were almost killed by your attacker and you went to school. You got out of the business, but you are still linked to it. Can you tell us about the kind of longevity other actors might have in this business? The complaint you always hear in Hollywood, especially for women, is that it's a very short shelf life. What kind of future do these people have?

MITCHELL: Well, this is a very short-lived career. It's almost like an athlete. Careers range from six months to three years on average. Men typically stay in the business for five to 10 years. Men can work a little bit longer. But you've got to remember this is predicated on youth and beauty. And so people run in and out of this business very, very quickly, and we have several programs. We have a very effective program for life after porn. It's a long-term program. It takes about two years to complete and it's combined with the scholarship program for the actors and actresses that are choosing to get out of the porn business.

CAFFERTY: How much does it pay? How much does the average actor in a porn movie make?

MITCHELL: Well, this is really gauged on per body part, per partner, per scene, fir example...

CAFFERTY: Just give me a number. The average actor in the average porn film, in other words, you've got a career that lasts six months and three years. I'm trying to get an idea of a rough kind of a living these people make.

MITCHELL: Well, I would say between $600 and $1000 a day people make. Between $600 and $1,000 a day would be the average porn star. Now you've got some of the A-list women that are on contract that probably make much more than that. But on average, you know, an actor or actress gets between $600 and $1000 a day. No residuals.

CAFFERTY: And do they work five days a week?

MITCHELL: They can work up to seven days a week. But most people work about three to four days a week.

CAFFERTY: All right, and a career that lasts usually no more than about three years. So basically unprotected sex in the porn industry, you risk AIDS for something in the neighborhood of a couple of hundred thousand dollars for the lifespan of your career. I don't know, I guess that's a judgment call everybody has to make.

MITCHELL: Yes. It's an occupational hazard, and it is -- HIV and STDs are the number one occupational risk.

CAFFERTY: All right, Dr. Sharon Mitchell, thank you for joining us. Appreciate having you on the program.

MITCHELL: Thank you for having me. CAFFERTY: All right, time for a break while we let the sales department earn a couple of bucks. When we come back though, the English major in the hot dog suit. We'll have survival tips for recent college grads. See how to stay away from those jobs where they make you dress funny and hand out those fliers.

And sorry, Dick, find out why those words could be worth million for former New York Stock Exchange boss Dick Grasso.

(COMMERCIAL BREAK)

LISOVICZ: This month, hundreds of thousands of wide-eyed men and women will graduate from college and head out into the real world. Good luck. But instead of frat parties and dorm life, they'll have to deal with a tight job market, scarce housing and their own finances. Hear that, Jack? Perish the thought. Our next guest has written a survival guide for college grads. It's called "Welcome to the Real World: You've Got an Education, Now Get a Life." Stacy Kravetz is the author.

Welcome.

STACY KRAVETZ, AUTHOR, "WELCOME TO THE REAL WORLD": Thank you.

LISOVICZ: You know, one of the things that I remember everybody stressing out over is that first job. One of the rules you have for surviving college and getting out into the real world is that the first job doesn't have to be great.

KRAVETZ: Yes, that's true. The first job is rarely your be-all, end-all job that you're going to have for the rest of your life. I don't think I know a single soul for whom that's the case. Usually your first job is kind of a continuation of college in some ways. It's a place to continue your education, only your education directed toward the job that you will ultimately have. So it's a place to get skills to help figure out what you really want to do, what you are good at and to sort of act as a stepping stone between your education and your career.

SERWER: Hey Stacy, I've always wanted to ask someone like yourself this question. How many people really get jobs from the human resources department and doing formal interviews and how many people get jobs just by connections? And I don't mean that in a bad way, but someone introducing someone to someone and helping you get a start in life. Isn't networking really the be-all, end-all here?

KRAVETZ: It is. I mean, the career counselors are great for what they do, which is to -- they can run you through Briggs-Myers tests and help you figure out what your well-suited for...

SERWER: What color your parachute is?

KRAVETZ: Exactly. But it's often the case that the companies that come to schools are interested in a very narrow range of types of jobs. They are looking for people in computer graphic -- or computer technology and sales. And that sort of rules out all of the humanities, liberal arts majors and those who are going to want to go work in anything from advertising to medical fields that aren't necessarily supplied by going to medical school.

They are going to have to go and talk to people they know, make use of informational interviews, read up on the kinds of jobs that are available in fields that they like; but probably most likely, call people that they know and call graduates who are working in fields that sound interesting to them and see what they can find out that way. And you do often get your jobs through connections or through a network of people who you have cultivated who are doing things that sound interesting to you. And that's not a bad thing.

CAFFERTY: Stacy, Jack Cafferty. I've got four daughters, so I've been down this road a time or two. I want to ask you about the degree to which colleges and universities may be guilty of perpetuating a myth. And the myth that I think they may be culpable in, perpetuating is that you come here, you spend four years, you study hard and you make good grades and at the other end of that experience is a good job.

Well, there aren't any jobs. For the last three years there haven't been any jobs. But the schools, and I know this from personal experience at least in one case, one of my kids, the schools are very reluctant to come up to you and say, you know what, you can go here for four years, but don't expect to find a job because there ain't any jobs. They don't want to do that because people wouldn't be spending tens or hundreds of thousands of dollars a year to send their little darlings off to the ivy covered halls. I mean, what about that, isn't there something to that argument?

KRAVETZ: Absolutely. I think part of what a school does, and rightly so, is to give you an education. And that education is what will help you find a job.

CAFFERTY: But don't they also create the idea in kids' minds that if they go to college, that's the key to getting a good job? I mean, that's how I grew up.

KRAVETZ: Yes, absolutely. And there is the idea that somehow there is a correct major that you could pick that will lead you to a job or that there's a correct internship that you should have. And that's just not the case. And that's why the people who say, it doesn't matter what you major in just do what you want to do, it's hard to follow that advice because you always feel like maybe there is some holy grail that you should be following.

But if you can follow that advice and just see education for education's sake and then figure that your job search is going to be a whole other ball game, which is not going to be easy. They don't tell you that, but that is the reality. You are basically out of school with a lot of other people who are looking for jobs, some of whom already have job experience and they are still going for the same entry-level jobs that you are going for.

And you have got to just kind of use the education that you've gotten, figuring out how to fend for yourself, getting creative on doing your research on what jobs are out there, what skills you need, figuring out how to market yourself and package yourself. Those are all things that you sort of learn right out of the gate. But they are not solid skills that you've necessarily gotten just by going to four years of school. So you learn when you start.

CAFFERTY: Education for education's sake.

KRAVETZ: That's a bit of wisdom.

CAFFERTY: Stacy, thank you, it's nice to have you with us, appreciate it.

KRAVETZ: Thank you.

CAFFERTY: She wrote "Welcome to the Real World: You've Got an Education, Now Get a Life."

Just ahead, would you give $48 million for an apology? Former New York Stock Exchange Chairman Dick Grasso says he would, of course, he's got over $100 million. So everything is relative. We'll have his story.

And if you'd like to apologize to us, knock yourself out. If you want an apology from us, lots of luck, you'll have to e-mail us either way at inthemoney@cnn.com.

(COMMERCIAL BREAK)

CAFFERTY: Former New York Stock Exchange chief Dick Grasso now says he's willing to do without some of the huge pay package that led to his ouster last year, but there's a catch. Our Webmaster Allen Wastler has more on that as well as the "Fun Site of the Week."

When he left there couldn't hardly get it all in his pockets, now what's up?

(LAUGHTER)

ALLEN WASTLER, MONEY.COM: He's got $139.5 million already. That's salary and pension. He said, that's mine, baby.

SERWER: The New York lotto jackpot.

WASTLER: That's mine. But there's another $48 million in deferred payments that still owed to him. And he -- this just out in a "Newsweek" interview, one of the very few interviews that he's given. And he said...

CAFFERTY: Might be the only one that I'm aware of.

WASTLER: That's the only one that I can recall too. He said, you know what? I'm willing to forgo that $48 million if the NYSE says I'm a reputable, honorable man and I've done nothing wrong.

SERWER: That's a big if. That's a big apology.

WASTLER: ... the NYSE has been like, yes, right.

CAFFERTY: Why do you suppose, though, that he's making any kind of an offer to give any of this money back? Isn't there some possibility that they may go after this money whether he chooses to give it back or not?

WASTLER: Well, as you'll recall, John Reed, the interim chairman that they set up at the NYSE and sort of said, clean up this mess, will you and everything? He did this great big report and he said, oh, this report, a lot of stuff here to consider. Here, Mr. Eliot Spitzer, New York attorney general, why don't you consider this? And he sort of left it on Spitzer's lap. OK?

So Spitzer has the question of, all right, do I go after Grasso on a law that prohibits people from reaping excessive compensation from a nonprofit? But here's the political problem for Mr. Spitzer, if he goes after Grasso, he's probably going to drag in the executive compensation committee from the NYSE in there.

The chairman of the committee at the time for approving Grasso's contract was H. Carl McCall, a big wheel in the Democratic Party in New York, and if you are thinking of becoming governor of New York, which a lot of people think Mr. Spitzer might be doing, do you really want to drag in somebody that you are going to have to be buddy-buddy with if you decide to run?

SERWER: They did take that plaque down at the exchange, the Dick Grasso plaque.

LISOVICZ: And a lot of the pictures, and there are a lot of pictures.

WASTLER: And a lot of angst about that, too. You know, well, Grasso, he did help out after 9/11. He deserves that plaque there. But you know, we want to make it a more inclusive plaque where everybody is...

CAFFERTY: Let's go to the "Fun Site of the Week" and look at some other pictures.

WASTLER: We're heading into the political season. And a lot of fantastic things to report. I think it's a good idea to review that not everything on the Internet is true. So we go to the Museum of Hoaxes. Here you go. President Bush reading kindergarten books upside down. Hoax or real?

CAFFERTY: Oh, come on.

(LAUGHTER)

CAFFERTY: You are suggesting he'd be reading the book upside down and it would be a real picture?

WASTLER: It is, in fact, a hoax. OK? Now to prove that we're a two-party system here, let's go to the next one. Ah, Tom Daschle. Now, is that really how you are supposed to do the Pledge of Allegiance? OK. Shouldn't it be the right hand over your heart? OK. Hoax or real?

SERWER: It's real.

WASTLER: It's a hoax.

WASTLER: OK. Two hoaxes. All right, two hoaxes, here's another one. OK. You get a lot of fantastic things. Look at that. You've got a Coast Guardsman trying to climb up the ladder and there's jaws going after him. OK?

LISOVICZ: That's real.

SERWER: That's called shark fishing. That's how you catch a shark.

CAFFERTY: That's right.

WASTLER: Folks, it's a hoax, hoax, hoax, hoax, hoax, hoax.

CAFFERTY: One more.

WASTLER: One more. Let's go to the scientific frontier. OK. That is a jet supposedly breaking the sound barrier.

SERWER: That's a marsh mallow.

WASTLER: Is that what it looks like? Hoax or real?

SERWER: That is real.

CAFFERTY: Is that real?

WASTLER: That's real, that is, in fact, real.

LISOVICZ: One out of four.

WASTLER: So there you go, you can ...

SERWER: That's a cool site.

WASTLER: ... get the link on our show page. Check it out, they've got plenty of other little real or hoax questions.

CAFFERTY: Sounds good. This show, by the way, is real.

SERWER: Very real.

LISOVICZ: No hoaxes.

CAFFERTY: Much more to come, including your answer to our "Question of the Week." If you want to drop us a line, feel free, the address is inthemoney@cnn.com. We actually have somebody on the payroll here who is silly enough to answer all this stuff.

(COMMERCIAL BREAK) CAFFERTY: All right. Here now are some of your answers to our question about whether your mothers went to work or stayed home when you were growing up and what sort of affect that had on you.

Colleen (ph) from Texas wrote this: "I grew up during the Depression and my mom had to help my dad at his watch repair store. I was a latchkey kid, but I also helped out in the store and made deliveries. The experience turned me into a liberal socially and a conservative fiscally."

Gene (ph) wrote: "Having a working mother during my formative years turned me into a juvenile delinquent. I didn't get straightened out until I entered the military."

(LAUGHTER)

Lisa -- he might have become one anyway. Lisa (ph) from Buffalo wrote: "My mother and father worked different shifts so one of them could always be watching us. My memories of growing up are the reason why I'm 32 years old and have no children. Unless I can give my children the benefit of two real parents, I will remain childless.

It's time now for our e-mail question for this week, which is as follows: "How are rising gasoline prices affecting your travel plans for this summer?" Send your answers to inthemoney@cnn.com. And you should also visit our show page at money.com/inthemoney which is where you'll find the address of our "Fun Site of the Week": Pictures Real or Hoax?

Thank you for joining us for this edition of the program. Thanks to our regular gang, CNN Financial correspondent Susan Lisovicz, "Fortune" magazine editor-at-large Andy Serwer, and Money.com managing editor Allen Wastler. A fine group, don't you agree?

Join us tomorrow at 3:00 Eastern when we'll look at the new face of warfare in the 21st century. Increasingly U.S. troops are fighting the enemy on urban battlefields. Find out whether the American public and the Pentagon are ready for the fight. That's tomorrow at 3:00 Eastern, hope to see you then, until then, enjoy your weekend.

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


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