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What Do New Cabinet Members Mean For Policy?; Bush To Push For Tax Simplification; Interview with Allan Sloan

Aired November 21, 2004 - 15:00   ET


ANNOUNCER: From New York City, America's financial capital. This is IN THE MONEY.


JACK CAFFERTY, HOST: Welcome to the program. I'm Jack Cafferty. Coming up on today's edition of IN THE MONEY:

How to build a Cabinet: The new term's brining new faces, new objectives. Find out what the lineup says about where the country may be headed.

Plus his mind, your money: George W. Bush wants to change the way Uncle Sam collects your cash. We'll look at the president's tax plans and trying not to put you to sleep in the process.

And, Stick out your tongue and say nah: As in saying nyat (SIC). Saying "no" to work when you're sick could save your company some cash and we all want to save our companies' money, don't we? Find out why so many people are taking a bug to the office.

Joining me today, a couple of IN THE MONEY veterans, CNN correspondent, Susan Lisovicz, "Fortune" magazine editor-at-large Andy Serwer.

One of my favorite stories of the week, there are researchers out there who are now urging members of Congress to set up a commission amongst themselves to study pornography because these researchers are afraid that the addiction to pornography, and they like it to being as serious an addiction to heroin, is crupsing our society. They want the Congress to study porn and come up with things like bus posters and TV ads and stuff warning about the danger of pornography addiction. What I do not want to see what the bus poster looks like that says "This is your brain. This is your brain on porn." I don't want to see that.

ANDY SERWER, "FORTUNE": Or don't look at this.


SERWER: Yeah, I don't know, I mean, I don't consider myself a sexpert, but you know, I've been to a few of these websites and anyway, what...


SERWER: The thing is, you know, my understanding about this issue is, you know, they talk about the danger of pornography.


SERWER: Seriously and the only thing pornography does, it doesn't make people go out and commit sex crimes, what it doe is it makes you want to see more pornography. In other words --you know, you could you argue that it's kind of a victimless crime. Never mind a complete waste of government money and time.

LISOVICZ: Well depends on what kind of porn it is. I mean if it's a masogenist porn, that's a different story

SERWER: Don't go there.

LISOVICZ: But, I have two observations, one is that there's going to be a lot of support from the democrats and republicans...

CAFFERTY: Oh, yeah this is going to be one that goes across the aisle.

LISOVICZ: Exactly, bipartisan support. But the other one, I would be very interested to see what kind of lobbyists come down from big business. You know why? Because very respected Fortune 500 companies are deep into porn. Any time you travel and go to a hotel and switch on the channels believe me, there's plenty of adult entertainment. It makes billions of dollars.

SERWER: Sure. They'll trot out the first amendment, is what they'll do. They'll talk -- they'll cloak it in freedom of speech and freedom of the press and the freedom of everything else. But bottom line is, I mean, can't you think of something better to do with your time and money?

CAFFERTY: Yeah. I don't want the Congress doing this, OK? I just don't want my senators...

SERWER: I know it when I see it, but just -- yeah.

CAFFERTY: Just, I mean, fix -- you know, my taxes, fix social security.

LISOVICZ: Social security.

SERWER: Fix Iraq.

CAFFERTY: You know, fix, fix something that's -- fix -- and just, and don't do that.

A batch of President Bush's Cabinet pick's out this week, the results look more like a little fine tuning than any sort of major revolution. Team players are in, they're way in. The potential dissenters, well, they're packing up and getting out of Dodge. And for a look at what the choices can say tell us about the next four years, we're joined now by Kathryn Dunn Tenpas, who is a senior Fellow at the Brookings Institution and a visiting Fellow at Washington University's Weidenbaum Center.

Welcome to our program.


CAFFERTY: It's not unusual for Cabinet members to resign at the time that a president wins a second term. There is a divergence of opinion however, on whether the right thing to do is surround yourself with people who agree with you or to surround yourself with at least some people who might offer alternative points of view. What do you see happening in President Bush's Cabinet changes here?

TENPAS: Well, he clearly is promoting from within, much like private corporations do over times, promote people who have done a good job to more senior positions. So, I don't think that's completely unusual. I think it's also worthwhile pointing out that what could happen to the White House staffers is that they'll find themselves, now as Cabinet members, actually having less influence than they had when they were in the White House. And that's because the White House has very tight reins over the various Cabinet secretaries and wants to keep them in line and so Margaret Spellings and Condoleezza Rice may actually be surprised by the decrease in influence that they have once they become Cabinet secretaries.

LISOVICZ: You know, Kathryn, but in this particular administration, some of the biggest controversies have erupted because there was not enough difference of opinion. For instance, about Iraq, was it really critical that the United States had to move in when it did, when, in fact, the WMD is yet to be found, the links to al-Qaeda are, at best, tenuous. So, wouldn't the president be a little bit more sensitive to the criticism that he is, continues to surround himself and bring them closer, his yes men and women?

TENPAS: Well, actually, I think that it's not at all clear to me. I mean, I'm not on the inside of those oval office meetings, I'm not on the conference calls. I don't know how much dissention -- maybe there's more dissention than we know about. But, I also think it's the case that if you're worried about differences of opinions and you want that to be part of the dialogue that goes on within the White House, you should care more about the White House staff than the array of Cabinet secretaries. The Cabinet secretaries, while it sounds like the most senior position within the administration, they're not within 1600 Pennsylvania Avenue, they're not sort of in the sphere of the most heated debates. And many times they're on the periphery and that's what usually leads to a lot of resignations is that these Cabinet secretaries find that they don't have near the autonomy, near the influence that they should have or would like to have. And so, I think if you're concerned about a lack of debate and a lack of difference of opinion, you want to look at the president's closest advisers within the White House because that's where you'll see the key arguments happening.

LISOVICZ: You know, Kathryn, I like how you equated it to a business because, of course, President Bush is our first p president who has an MBA, so maybe it is like a business. And in businesses often you surround yourself with people who agree with you, which is not necessarily so productive. But, you know, there are plenty of democrats out there with differences of opinion that they hear all the time. So, I wonder if it's kind of a red herring issue. But, I want to ask you, how typical is this changing of the guard?

TENPAS: It's very -- very typical, when you see, if you look at two term presidents, going back to Reagan or oven going back to Eisenhower, you see the greatest amount of Cabinet turnover between year four and five, which is what we have now. I think what's most unusual about President Bush is the remarkable stability he's had in his Cabinet and senior White House staff. We have a study going on at Brookings where we look at the stability within the White House A- team, the most senior level of advisers and he ranks highest in terms of White House stability and Cabinet stability and I think that's quite a statement. It shows that this whole notion of Bush loyalty is really not just some sort of conventional wisdom that came out of nowhere, that in fact there's data that supports this notion of loyalty within the Bush administration.

CAFFERTY: Let me ask you how this concept of loyalty plays outside the United States and specifically I want to talk to you about Condoleezza Rice. General Colin Powell could get in any door anywhere on this globe and not only was he welcomed, but his views were respected and listened to. Five-star general, former chair chairman of the Joint Chiefs of Staff, conducted the architecture for the first Persian Gulf War, and with the current situations in Iraq, in North Korea, in Iran, in the Middle East, is Condoleezza Rice the right choice n your opinion? Can she have the kind of access and carry the same credibility and weight that General Powell did outside the country, not in the oval office, where she's 24 carat but out there where the trouble is?

TENPAS: Yeah. Oh, absolutely think that if you're a European you are not happy about the appointment of Condoleezza Rice because you see her as simply a mouthpiece for the administration, you see her as somebody -- as somebody who was complicit in the whole decision to go to Iraq and a decision that many Europeans think was completely misguided. So, in that respect I think that her appointment was problematic.

At the same time, what she does carry is because she has such a close relationship with President Bush, closer than Colin Powell had, her words are the president's words. Her sort of willingness and agreements with other countries leaders are probably going to happen. It's much more likely that will become -- there will be a result there, a tangible result. So, if you are a foreign leader and meet with Condoleezza Rice, you can be certain that when she says "yes" to something that in fact it will go through and it's consonant with what the administration wants. So in that respect, some leaders might find it more beneficial. At the same time, I completely agree with you, that there is a lot of concern particularly among European nations about her appointment and about the fact that she basically is a point person for the president and not really an independent thinker and they really valued Colin Powell's leadership and I'm sure that many Europeans leaders are disappointed at this point. CAFFERTY: Well, and she's going to certainly have her hands full. She'll be busy the next four years.

Kathryn Dunn Tenpas, is a senior Fellow at the Brookings Institution. Thank you very much for joing us. I appreciate it.

TENPAS: You're welcome. Thank you.

CAFFERTY: When we come back on IN THE MONEY:

Pay him now or pay him later: The president wants to make tax reform a top priority during his second term. Find out how much that's going to cost us.

Also ahead, you call that private? People can find all sorts of secret stuff about you online. Find out where they're looking and what they're learning.

Plus, spot the work of genius. Great art's in the eye of the beholder, on our "Fun Site of the Week."


CAFFERTY: Tax reform, atop the president's to-do list for his second term. He's talked about everything from a flat tax rate to national sales tax that targets consumption over income. High hopes for big changes, but can they get past the Congress? Here to talk about it with us is Allan Sloan, he's the Wall Street editor for "Newsweek" magazine.

Allan, welcome to the broadcast, nice to have you with us.


CAFFERTY: Charles Grassley, republican on the tax committee already saying, "Well, I don't know if we can do this." I mean, how many lawyers, accountants, et cetera, will be tossed out of jobs and how many firms that simply fold up if we had a national sales tax based on consumption or a single form of income tax can be done on a 3 by 5 file card, not unlike the gentleman -- Mr. Forbes, who ran for president. I mean, those concepts seem deceptively simple, or are they?

SLOAN: They sound deceptively simple, but in Washington, as in life, the word "reform" means -- it's code for "what I want." And you and I think reform means making things better, but here, I mean, the idea that we'll throw out the income tax and have a sales tax or have an income tax you can fill out on one side of a piece of paper it is, forgive me, nonsense. I don't think that's what these guys intend, I don't think that's what anyone is going to do and I suspect by the time we're done, the thing will be reform only in the eyes of certain beholders and to me and maybe even you and some other people, it will actually be messier or worse than it is now.

SERWER: Alan, Andy Serwer here. How are you?

SLOAN: Fine, Andy.

SERWER: What about social security, privatization, putting a piece of it in the market. Obviously, a controversial topic, it's something the president seems to be for. A lot of people are against it. Isn't it worth giving it a try, though?

SLOAN: Well Andy, I mean, you've been around almost as long me, and you know the markets probably better than me and the question is, compared to what? Show me a plan. Show me what it's going to cost. Show me what I have to give up in return for this, because it's not like it's free. You know, show me all of these things and then she me a whole lot of other stuff having to do with how benefits are calculated and I'll see if I think it's good or bad. I mean, I got kids and current social security isn't going to make it in its current form, something has to happen. The idea is not -- doesn't in and of itself scare me, but it's the actual way it works that concerns me and we don't know any of that until we see what they're proposing.

LISOVICZ: You know, Alan, Congress on Friday raised the debt ceiling by $800 million and there's no question that President Bush wants to get things done in his second term. He's certainly got the wind at his back with republican congress, again, with even more members of the democrats even more -- weaker yet, but all of this costs money, and making tax cuts, for instance, permanent, just really makes the problem that much worse.

SLOAN: Well, you're talking to the wrong person. I agree with you, but I don't run the country and I wasn't elected to anything. And what matters is not what you think or I think, but what George bush thinks and what his allies, what they can do. We're applying our ideas and assuming that he thinks that way and from what I've seen of the president, not that we're buddies, he thinks it's highly different than the rest of us, especially those of us like Andy and me who count for a living.

CAFFERTY: Well, you know, with all due respect to my esteemed colleague Susan Lisovicz, how much money does the government simply waste on every kind of screwball pork barrel give-away deal that they can come up with? You know, they talk about the deficits, only in terms of "we've got to maintain this huge revenue stream," translate: take it out of your pocket and my pocket and give it to them so they can throw it away on stuff. What if something like spending responsibility was addressed? I mean, there's a foreign concept in Washington.

SLOAN: Well of course it is, and what's happened is, whoever's in power wants to spend money, and whoever is out of power talks about the deficit. So it used to be that the democrats wanted to spend money and the republicans said "oh, it's a deficit, it's the end of the world." Now, the same people who were babbling on about constitutional amendments to balance the budget all of that, they're saying, "what's another trillion, half a trillion? $5 trillion?" It doesn't matter. It's a game, and the idea that if we starve the beast, cut the taxes, the government will run more efficiently, that doesn't work because the government just goes out and borrowers the damned money. I mean, it sounds great, but its never and it's never going to, certainly not under these circumstances.

SERWER: So, the -- do deficits matter then, Allan, I mean, or is it just something that sort of comes and goes like cycles in the economy?

SLOAN: Oh, I think they matter a lot and now I'm old, OK, I'm almost 60. I've got grown children.

CAFFERTY: Hey Allan, I'm old. I'm 61.

SLOAN: Yeah, you're...

CAFFERTY: You're young. You're not 60 yet.

SLOAN: Hey, I'm closing in on it, though.

CAFFERTY: Just want to clear that up there.

SLOAN: No. Fair enough, I mean, we're just mature. We're not actually old. But you see, I look at stuff like the interest bill. I know it's boring, but the interest bill on the part of the debt that's owned by investors, is going to the moon. Soon it's going to be $200 billion a year, $240 billion a year, $260 billion a year, a large part of which is being sent now to creditors in other countries like 40 percent of it, and we're sticking our kids with the bill. I'm not one of these people who says "The deficit is up today, therefore interest rates are up today and if interest rates aren't up today everything is fine." In the long run, you can't keep doing what we're doing. You see the dollar is slipping, there's all sorts of problems having to do with the country in various ways, consumes more than it takes in, and one day, the bill comes due, and I'd assume that my children or grandchildren didn't have to pay it. I'd rather deal with it now, but that's called, I guess, being an elitist so I have to be careful.

LISOVICZ: Well, we're not elitists. We just -- we try to be them sometimes. Allan, is there any sense of optimism that Congress will get religion within this four years that there be any attempt to rein spending in?

SLOAN: I mean, I don't think so. Of course, I'm very skeptical of all of all this. The minute I hear the word "reform," I reach for my pocketbook. It's just like when someone does an ad saying our cars are quiet, I assume it means they've had a survey saying the cars are noisy. I think the only thing that might rein in the current system is if the markets won't land or if the markets really run up interest rates or there's some sort of event that scares people because nothing seems to happen in Washington unless there's crisis. I hope there won't be a crisis, but the idea that we'll have some sort of discipline, again, under the current administration and the current congress, is to me, a joke.

LISOVICZ: Just keep watching the sinking dollar. That'll be our next subject because the foreigners are the ones financing our debt right now. Allan Sloan, "Newsweek" editor -- Wall Street editor for "Newsweek" magazine, thanks for joining us.

SLOAN: My pleasure.

LISOVICZ: Coming up after the break: The blue light meets the wish book: K-mart and Sears are joing forces. Find out what Wall Street thinks about that.

Plus, nobody's indispensable, not even you: See why going to work sick could hurt your colleagues more than it helps them.

And, you call that art? See if you can tell a masterpiece from a piece of junk on our "Fun Site of the Week."


ANNOUNCER: When General Electric CEO, Jack Welch, handed the reins over to Jeffrey Immelt in 2001, Welch said his successor's adaptability made him the perfect leader for GE. So far he's right. Since taking over, Immelt had continued growth at $134 billion conglomerate, even during a painfully slow U.S. Economic recovery. Immelt has also expanded GE's global presence; in fact, GE expects to see $5 billion in revenue from China in 2005.



LISOVICZ: Now let's take a look at the week's top stories in our "Money Minute." A second possible case of mad cow disease sent cattle prices tumbling this week. The U.S. Department of Agriculture said it will take several days to get conclusive results on the suspect beef. However, officials did say the meat did not enter the food chain. Some foreign buyers like Japan have had bans on U.S. beef since the first case of the disease was confirmed 11 months ago.

Just in time for the holidays: Shopping is getting more expensive. Climbing energy prices fueled a 0.6 percent hike in consumer prices last month. That's the biggest jump in five months. The consumer price index works as a barometer of inflation.

And the Food and Drug Administration is throwing cold water on a racy Viagra ad. The FDA charges that drug maker Pfizer overstated the effectiveness of its erectile dysfunction drug in the ad. The feds also say that Pfizer did not disclose the risks associated with taking Viagra. The company says it is in the process of pulling the devilish commercial.

SERWER: Big news on the retail front this week. Discount retailer K-mart is merging with Sears Roebuck and Company in an $11 billion deal announced Wednesday.

The new company, which will be known as Sears Holdings, will continue to operate both brands. But, some K-mart stores will be moving into Sears locations. The deal gives K-mart a presence in shopping malls across the country.

K-mart has come a long way since it filed for bankruptcy protection in January of '02 only to emerge from it in the spring of '03. Shares in the company have soared ever since and that makes K- mart our "Stock of the Week."

You know, a lot of people are saying, oh this deal's all about putting Sears and K-mart together so they can do battle with Wal-Mart. That's partly true. It's really about this guy, Eddie Lambert, the billionaire, who's behind all this, who's trying to make money for his hedge fund which is all fine and well, I mean this is America, but you know, he's the guy pulling the strings here.

LISOVICZ: Yeah, and he is making money in the process.


CAFFERTY: What about the antitrust concerns? I read the government may want to take a look at this. It seems silly, the combined company pales in comparison to a Wal-Mart.

LISOVICZ: Still number three.


SERWER: No, I don't think there's any question that there are no antitrust concerns. It was interesting, one of the senators, Jack, who suggested they take a look at that was Senator Kohl from Wisconsin. His family started Kohl's, the retailer. So, may maybe he's kind of interested in that. They sold out their position a long time ago. But that was sort of interesting. You know, there's Target out there; there's Bed, Bath & Beyond; I mean, there's all kinds of retailers out there and I think, you know, Sears is a stronger brand than K-mart. These guys will have a tough job. I mean, between Wal- Mart and Target, that's a lot of stores.

LISOVICZ: Right. Well, there's one advantage when right away when you put even two struggling retailers, with their kind of size, together and that is that they will have pricing power when they buy. That's one of the things that has made Wal-Mart the behemoth that it is. Before I ever stepped into a Wal-Mart store, I used to ask retail analysts what is it about Wal-Mart that makes it great because they're not here in the northeast.

CAFFERTY: They hold a gun to people.

LISOVICZ: They do, to their suppliers.

SERWER: Quite simply.

LISOVICZ: But they also are always well stocked, both in terms of merchandise and with people. If you go into a K-Mart, there's plenty of K-mart's in the northeast, you don't have that situation. So, there are plenty of other problems. But, one thing that will be realized with the two of them together is that they should have better -- better pricing power over the suppliers.

CAFFERTY: That pricing power issue aside though, K-Mart and Sears have not exactly been lighting up the nighttime sky. So, if you take one company that's doing poorly and you marry it off to another company that's doing poorly creating one company... LISOVICZ: One big struggling company.

SERWER: Well, put it another way Jack, you get two wallowing ships and you latch them together, will that make them float?

CAFFERTY: That was kind of where -- yeah. Putting a chain between the Titanic and the Lusitanian wouldn't keep either one of them up. You know what I'm saying?

SERWER: Yeah. I know what you're saying. I don't know if -- I agree with you. I don't think that's really going to -- I mean, you look at Compaq and Hewlett-Packard that has not been the healthiest marriage either.

CAFFERTY: Oh, what a nightmare. Hewlett-Packard mad printers before they ever heard of Compaq and they only think they're making any money on is printers.

SERWER: Right.

LISOVICZ: Just to give you an idea how far Sears has fallen; a few years ago it was a member of the Dow 30.


LISOVICZ: You would never figured that was coming.

SERWER: Stock's gone nowhere for 30 years. Any way, we'll pay attention to that deal, I'm sure, as it continues to unfold. Coming up on IN THE MONEY:

Too many people with too much access: If you don't want to find out how the whole world can see your private information, go ahead and change the channel.

Plus, they are not handing out sainthoods out here: The office martyr who shows up sick for work and costs the company money. See what is driving more employees to do it.

And art dealer or junk dealer: Get the lowdown on our fun site of the week.


LISOVICZ: Whether you put it there or not, chances are some of your personal information is out there on the web, an address, a phone number or maybe even your Social Security number and it does not take a skilled hacker to find that information. So what can do you to protect yourself? Let's find out now from Fred Rica, a cyber security expert and a partner with pricwaterhousecoopers. Welcome.


LISOVICZ: I think the key here is cyber. It's so much easier on the web to get to this private information. RICA: That's exactly the problem. What we're talking about is data that has always been in the public domain, but it was hard to get to. You had to go to the courthouse. You had to see the county clerk. They were only open 8 to 4.

LISOVICZ: Wait in line.

RICA: You had to wait in line. You had to Fill out a form. Now anybody with a computer and search engine -- we did a search the other day. We just put public records online into Google. 11 million hits of free and pay services that will provide you access to that information and you're exactly right. It's easy now.

SERWER: What did you find out about Susan? You know what's interesting, it's part of the culture now. I mean people when they are going out on dates, they Google the person and when you're having a business meeting, I often do this, Google the person, find out about them and it is pretty darn amazing the stuff that comes out just on the cursory search. The spammers, the phishermen as they call them, whatever, are getting better. I got one from someone who's trying to rip me off. It made it look like it was an e-mail from Citibank and it is so dangerous. It says click here because your account -- we have questions about your account that stuff is really bad.


SERWER: Thank you, Jack. And all my money is just disappearing out of my account the next day.

CAFFERTY: And thank you.

SERWER: You're welcome.

RICA: But phishing as it's called is probably the single biggest threat to a consumer's privacy right now because to your point, the e- mails look so authentic. They've got logos. They send you to Web sites that look real and then they ask you for information. They scare you. If we don't get your pin number and your account number by Friday, you're going to lose access to your ATM card.

SERWER: Pin number.

RICA: And studies show that about 5 percent - they get about a 5 percent hit rate on those. So if you send out a million or ten million of these e-mails, you've all of a sudden got a huge amount of data.

LISOVICZ: You just hit pay dirt.

RICA: It's not that hard.

CAFFERTY: The great debate is whether or not the Internet should be regulated at all and this kind of thing sounds like it might lend itself to the idea of some kind of regulation.

RICA: Here is the problem, though. There is regulation around this data. We've got things like (INAUDIBLE) to protect financial data and HIPPA to protect medical data. It's the secondary use of this data that creates the problem. So take an example. Say you were getting divorced. In your divorce proceedings, it might come out that you take antidepressants. Well, normally that data would be protected. Your doctor or your pharmacy would never put that on line. But it gets in the court proceedings, now I can find out that Jack Cafferty takes antidepressants. That's the problem. It's the secondary...

CAFFERTY: Is there anything that can be done about it?

RICA: No. Not in the short-term. It's a complex problem. For the consumer, the main thing is to pay attention and be aware and understand what information you are giving, who you are giving it to and what you think they're going to do with it.

CAFFERTY: There's got to be certain information you just flat don't give out, period. I don't care what kind of e-mail you get, ever, ever, ever.

RICA: Well, but it's not just e-mail. It's physical too. Whenever you fill out a form that asks for personally identifiable information, you have to be careful. You have to understand what they are going to do with it, why they're going to use it, how it's going to get distributed. Most organizations that collect data today have privacy policies. As a consumer it's pretty important that you read that and understand what their stance is on protecting your data.

LISOVICZ: And stealing identity is so much easier now. There are a lot of people who say that you should always be shredding your junk mail because even junk mail has stuff on you that can be used against you.

RICA: That's a really good point. If I were going to target you specifically, I don't know that I'd start searching around on the Internet. I would try to get to your garbage first because your bank statements, your credit card receipts.

LISOVICZ: But even unopened things, solicitations, they have things on you.

RICA: That's right and so your point is well taken that a shredder is not a bad investment if you want to protect your privacy, absolutely.

SERWER: So they're going to know what drugs I have taken. I better get a shredder. This is pretty interesting stuff here. This identity theft thing is a really -- this is the cost of it to society has got to be spiraling out of control. A colleague of mine had his identity stolen, a guy in Columbus, Ohio was buying houses, all kinds of things. The police basically said, you know what? There's nothing we can do. This is a million dollars worth of stuff.

LISOVICZ: And your credit rating is --

SERWER: Exactly. Do you know how much this has increased or the costs of these kinds of things to companies?

RICA: The problem is, the company that monitored this, the credit card companies for example, they typically don't publish that data. So it's difficult to get your hands on it. The consensus is that it's large and that it's going to continue to grow. There's no doubt.

LISOVICZ: And there's stuff -- you know you talked about a divorce trial. But just the fact let's say if you bought a house.

RICA: That's right.

LISOVICZ: You bought a house. You're in your municipal records. It's very pedestrian stuff. You got a ticket.

RICA: Here you go, property tax assessor files so I can find out what you paid for your house, what the value is.

LISOVICZ: How much you earned.

RICA: I might be able to figure out how much you earned from that absolutely and it is very pedestrian stuff. You're absolutely right.

LISOVICZ: So, is there anything pending? You mentioned there was things on health records. There's also some things that protects children, is that correct?

RICA: That's right, the child online protection act which makes it very difficult for Web sites to gather information about children who are under 13 years of age. Yeah.

LISOVICZ: But what we should take away from this is be careful.

RICA: You really do have to be careful. You have to use common sense and I like to call it good e-mail hygiene. If you see an e-mail that looks suspect, don't open it. Don't open the attachment if you don't know who it's from. It's unlikely that your financial institution is going to use something as unreliable as e-mail to communicate with you and if you get those, call up your bank and say did you send me this e-mail? It's very likely that they are going to say no.

SERWER: That whole thing, put your pin number in and send the e- mail back is just mind boggling. But you're right. It's got to be five out of 100 people would do that.

RICA: That's about right and again, it looks legitimate. It scares you because if you don't do something, something bad might happen. And again, if you don't have the level of awareness and attention that you need to pay to that, you may just - I've got to get this done because I'm going to lose my ATM card on Friday.

LISOVICZ: Valuable information from Fred Rica, a cyber security expert, partner with pricewaterhousecoopers. Thanks for coming by.

RICA: Thanks for having me. LISOVICZ: There's lots more to come here on IN THE MONEY. Up next, they'll live without you. Going to work sick won't save your company. In fact it might cost your boss some extra bucks. We will look at the rise of presenteeism as opposed to absenteeism.

And think of it as an art world garage sale. Test your eye for a find on our fun site of the week.


SERWER: You missed out on a flu shot, thanks to this year's shortage and now you feel a sniffle coming on. Too bad you don't have a single sick day left. So merry or miserable, you're going to go to work. Here to tell us why that's not only going to hurt yourself but your company as well is Joe Robinson. He's the founder of the work to live campaign and author of "Work to Live: The Guide to Getting a Life." So welcome to the program. Why is this such a problem, people showing up to work. How big a problem is it Joe?

JOE ROBINSON, FOUNDER, "WORK TO LIVE": Well, I think it's a major problem particularly this time of year. You have, these days, the problem of the paid time off bank where people's vacation time and their sick time is lumped together so that when somebody passes say five days of sick time, they start eating away at their vacation schedule and so, people don't want to do that so they report in to work. There is also the whole idea of the bravado in the American work culture which makes people think that they can never stop during the workday and that they also have to come in no matter what kind of condition they are in.

LISOVICZ: We in the news business always have that incredible work ethic. We always come in, rain --

SERWER: Please (ph).

LISOVICZ: -- sleet, snow. That's right, just like the mailmen. But in any case, our own company actually adopted the PTO system, the paid time off system and I am told that absenteeism went down dramatically because everybody is trying to get more vacation time. But, you are saying that actually employers may pay more in the long run just because they make everybody sick and everybody has to go to the doctors whether it's at the end of their workday or at the beginning.

ROBINSON: It's true. It comes out of your hide one way or the other. It also makes a lot of other folks around you sick when you come in with a bug. And productivity is nowhere near what it is when you are healthy. A lot of studies show that productivity definitely slides when people are just there physically. They call it presenteeism, but they're not really functioning mentally because they are so shot.

CAFFERTY: There's a shortage of something called job security in this economy these days. I wake up with a 103 degree fever and the head is all clogged up and I say, you know what, I'm not going in today. It's a Friday. And Monday my job is in Bangladesh as part of some sort of outsourcing move. I make light of it, but I mean there is no job security. Why should I stay home if I can come in and kind of protect my turf a little bit?

ROBINSON: Well, I think for the same reason you just pointed out, that there is no job security. I mean it really doesn't matter what you do.

You know, we have people who don't take vacations because they are afraid if they do, they might not be able to get their job back. Those people get laid off like everybody else. I think people have to look at what is smart for them physically, in other words, taking care of their health.

A great example is what happened to Jim Henson, the Muppet creator. He was known as a guy who was an 80 hour a week guy and he got sick. He continued to work through it. He wound up with a pneumonia that eventually killed him because he didn't back off. He was only 55 when he died. There are real repercussions to coming in when you are not feeling well beyond just the impact of spreading it around to other employees and the whole productivity factor which takes a dive.

SERWER: I like your point Joe, that it doesn't matter how hard you work. You're going to get laid off anyway or the flip side of that is, so you might as well not work that hard. I'm digesting this, but I think I like it.

Let me ask you a little bit about flu shots. You know, obviously this has just been a debacle. I mean our company had flu shots. Isn't that a really good idea? Once they get this thing sorted out and they rap some people upside the head who messed this whole thing up and we have enough flu vaccine, shouldn't companies give flu shots?

ROBINSON: Absolutely. It's really to their benefit in the long run to keep people healthy and there ought to be sort of an ethic within the company that when somebody comes in sick, people are saying what are you doing here? Why are you jeopardizing our project? Why you are jeopardizing the health of the section? Instead we have this warped idea that coming in, if you can barely stand up, is what you are supposed to do because we have this ingrained notion that if you slack off for a second, that you are not worth anything when actually if you step back and recover yourself and get recharged, the same thing holds true with vacations. You can do a better job. Productivity is higher, etcetera, etcetera. So business is very short-sighted when they try to constantly get people to be there even if they're only there in a physical sense.

LISOVICZ: Joe, but there are exceptions to the rule. There was a company in Las Vegas, a big hotel that made headlines last month because it actually sent every sick person with the flu home with six days of pay and so a lot of people took it off and that's the kind of thing you applaud. In other words, it should be the employer that is really setting the tone here.

ROBINSON: I agree. I thought that was a fantastic idea. I mean, they sort of just grabbed the bull by the horns. They cut off the potential for even more of their employees to be sick and more --

LISOVICZ: And their customers as well.

ROBINSON: Exactly. Yeah. So, I think that's the sort of thing that if business starts to sit down and really analyze the picture, they can see that it's to their benefit in the long run to keep their employees charged up and energized and healthy and not to have them stumbling around the office in some sort of, you know, state of sickness.

LISOVICZ: Well, I'm going to give you the number for our HR representatives after the show.

SERWER: Yeah do that. I like what he was saying.

LISOVICZ: Joe Robinson is author of "The Work to Live: The Guide to Getting a Life." We approve of that as well, thanks for joining us.

ROBINSON: Nice to be here.

LISOVICZ: Coming up, turkey in the straw. It's the Thanksgiving dinner you can drink and the straw is optional.

SERWER: That's good.

LISOVICZ: Oh, yeah. And whether you are chugging a bird or just killing time, drop us a line. The address is


CAFFERTY: So if you are worried about overeating this Thanksgiving and let's face it, most of us do before that day is over,'s Allen Wastler has a less filling way to enjoy your favorite dishes. However the jury is still out the tastes great part. Allen's also got the fun site of the week. What up with you?

ALLEN WASTLER, MONEY.COM: This is -- there is a little outfit in Seattle, not that little anymore, makes about just under $30 million in revenues a year, but last year they came out with turkey and gravy soda and this year they amplified. Last year they sold out of turkey and gravy soda. Now they've got a holiday pack which has all these fine assortment thing. You got turkey and gravy. You got mashed potatoes and butter.

SERWER: Be afraid. Be very afraid.

WASTLER: Green bean casserole. Your favorite, Andy, fruitcake and cranberry, which I'll tell you right now is the chaser.

SERWER: Cranberry juice.

LISOVICZ: Where's the spittoon?

WASTLER: It's all over the place, but this is put out by Jones Soda Company. They've been a niche player in the premium niche market.

LISOVICZ: You first, Allan.

CAFFERTY: $30 million sales, they're making a buck on this.

WASTLER: On this though, this is not a big buck maker for them. They are selling the holiday packs at about $16. It's the buzz factor.

CAFFERTY: That's one of the reasons. The other reason is that it's awful. I tasted that turkey thing a year ago on the morning show.

WASTLER: Let's taste a little.

LISOVICZ: I haven't tried it. I'll try it.

CAFFERTY: Go ahead.

SERWER: This stuff, you put a little splash on your tetrazinni for the leftovers.

WASTLER: There you go.

LISOVICZ: Do I need to swirl it around in my paper cup?

SERWER: Here we go again.

WASTLER: It's vegan; it's kosher.

CAFFERTY: None of the above. It's horrible.

SERWER: That's the toughest part of the year, drinking the turkey soda.

WASTLER: It's surprisingly sweet.


WASTLER: As you know, they're going to donate 50 grand out of their proceeds and they are only making 80 grand off of this. They're only making 15,000

LISOVICZ: Why don't they donate their root beer flavor?

WASTLER: They are donating to toys for tots.

LISOVICZ: Why don't they give a better flavor for their charity?

WASTLER: They get all this buzz going, everybody is buzz, buzz.

LISOVICZ: Jack is talking about it.

WASTLER: Jack's talking about it. We're talking about it. Other news services are talking about it.

SERWER: You know what you could do is you could make ice cubes out of that stuff.

WASTLER: There's an idea.

CAFFERTY: What about the fun site of the week?

WASTLER: The fun site of the week, well, we have all seen art that we're like, that couldn't possibly be art and then we've seen stuff, say, oh that's beautiful oh, never mind. Here is a website for you. It's a quiz. Is it heart or is it crap? Here we go.

SERWER: That's art.

WASTLER: You think it's art?

LISOVICZ: I think it's crap.

SERWER: That's Katherine's (ph) wheel.

CAFFERTY: I vote art.

SERWER: That's a wheel.

WASTLER: And the answer is -- art. It is art.


WASTLER: Next one?

CAFFERTY: Those are chocolate bunnies. That's crap.


SERWER: I'll eat that stuff.

WASTLER: Jack, you have the eye for it. Yes, indeed, they are plain old chocolate bunnies and now your final test.

LISOVICZ: Oh, this is definitely --

SERWER: That's food.

CAFFERTY: I don't know.

LISOVICZ: It looks --

SERWER: It's a trick question.

CAFFERTY: That's like an Andy Warhol treatment of something. Remember when he did the soup can? I don't know. What is it?

SERWER: It's art.

LISOVICZ: That looks too familiar.

WASTLER: It is art. It's actually called wax fingers. Anyway, that website has loads of ones that you can just sort of figure out. SERWER: That's a good way of spending an afternoon.

CAFFERTY: Get your bottle of turkey soda.


CAFFERTY: Coming up next on IN THE MONEY, it's time to hear from some of you as we read some of your e-mails from the past week. You can send us an e-mail anytime you'd like, like right now if you want. We're at Back in a minute.


CAFFERTY: It's time now to read your answers to our question about the issues you would like the Supreme Court of the United States to address. Robert from Washington State writes -- what I would like to see the Supreme Court do is not take up the case of homosexual marriage. While homosexuality's increasingly been accepted in today's culture, the subject it too sensitive to approach at the moment.

D.W. in California says, let them decide whether we are a religious society or a secular society. When I came to this country 40 years ago, I understood that there was religious tolerances here. Now when I state my views, I'm told to go back to England if I don't like it.

And finally Mike simply writes this. As to the upcoming Supreme Court action, I just hope they enforce the separation of church and state.

Here is next week's e-mail question for you, question of the week. What do you think is the biggest problem facing the nation's education system? Is it the quality of our public schools, the cost of a college education? We're talking all about education next week on IN THE MONEY and we've like to know what you think. Send your answers to And you should visit our show page at which is where you'll find the address of our fun site of the week. Is it art or is it junk?

Thanks for being with us for today's edition of the program. Thanks to CNN correspondent Susan Lisovicz, "Fortune" magazine editor at large Andy Serwer and my pal managing editor Allen Wastler. Join us tomorrow at 3:00 Eastern time. We'll look at the Bush tax plan. Reform is a key priority for term two. Find out what it might look like and how it might affect us all. That's tomorrow at 3:00. Hope to see you then.


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