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American Pull Out of Iraq Discussed; Protecting Yourself from ID Theft
Aired April 16, 2005 - 13:00 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.
ZAIN VERJEE, CNN CORRESPONDENT: ..discovered the body not far from Lunde's home. It was partially submerged in water at an abandoned fish farm. Authorities have notified Lunde's family. We're going to bring you a live report coming up on CNN live on Saturday at 2:00 p.m. Eastern.
Protesters in Washington are calling on the G7 ministers to drop the debt of developing nations. Demonstrators are rallying this hour in Washington as the International Monetary Fund and the World Bank hold their spring meetings. Police have expanded their security barriers around the headquarters of the IMF and the World Bank.
Two government reports find security at U.S. airports is no better under Federal control than it was before September 11th. That's according to Congressman John Mica of Florida. He was briefed on the two reports by the government accountability office and the Homeland Security Department.
And at the Vatican, Catholic cardinals prepare for Monday's conclave. The official nine day mourning period following the funeral of Pope John Paul II ended today. Cardinals marked the day with a mass. They also destroyed the late pope's ring and seal, signifying the end of his reign. I'm Zain Verjee at CNN Center in Atlanta. We'll bring you more news at the bottom of the hour. IN THE MONEY though begins right now.
JACK CAFFERTY, CNN ANCHOR, IN THE MONEY: Welcome to the program. I'm Jack Cafferty. Coming up on today's edition of IN THE MONEY, pointing to the exit sign. Shiites in Iraq have been calling for a U.S. pull out and the Pentagon is warming up for a troop cut there. See if that adds up to get out time for Washington, D.C.
Also ahead, you and your shadow. Identity theft making big time headlines. Find out if you should bother taking out insurance against it. There is such a thing.
Plus a career that pays off with more than a paycheck, entrepreneurs tell their stories in a brand new magazine. We'll talk to the co-founder to see if we can learn anything about how to make our work life more worthwhile. Coincidentally, that's the name of the magazine.
Joining me today, a couple of IN THE MONEY veterans, my pal, CNN correspondent Susan Lisovicz, my other pal, "Fortune" magazine editor at large Andy Serwer. If you buy the idea that the stock market is a forward-looking instrument, something is troubling Wall Street. ANDREW SERWER, EDITOR AT LARGE, "FORTUNE" MAGAZINE: Yeah, that's particularly correct over the past couple days Jack, where the market has really slid and the immediate proximate cause has been weak retail sales, punk earnings. But I think you're right. It raises larger questions. Are we on the road to recovery? Is the economy picking up steam or are we moving backwards? A couple days ago, it looked like we've been talking about inflation, the economy overheating. Now we're going the other way.
SUSAN LISOVICZ, CNN CORRESPONDENT: And you can add a couple other things to the mix too, because on Friday morning you had import prices rising for the biggest increase in two years. We also had consumer confidence declining for the fourth month in a row. It's a nasty stew out there and you really see it playing out in the stock market.
Also the fears about inflation. On the one hand, you don't want the Federal Reserve to raise rates too aggressively. On the other hand, you don't want the economy to go in a toilet. It's at the early, early stages of the quarterly earnings report cards. Investors, analysts, nobody really knows where the economy is right now and that's where you're seeing - why you're seeing so much anxiety.
CAFFERTY: Interest rates though, historically speaking are still...
LISOVICZ: Low.
CAFFERTY: Low. The housing market is still doing fine. Earnings are not terrible. They expect double digit earnings growth pretty much generally across the board year over year for 2005. But we've got deficits, deficits, deficits, which are driving the dollar lower. We got a trade deficit number that would choke a horse.
LISOVICZ: And oil prices.
CAFFERTY: There are some structural problems that Washington and this economy and this country simply aren't addressing.
SERWER: Yeah, I think that's the real thing is the overlay, as the dismal (ph) scientists call it, which is to say these big problems are out there and you can talk about, oh, there's some small good things happening. There are always great things happening in this country, companies growing and things like that. But you've got the war hanging over and the oil prices and those are real big problems that are going to take a while to sort out.
CAFFERTY: All right. We'll keep an eye on it for you. Sooner or later, America's probably going to pull out of Iraq which would address one of the problems that's probably troubling the stock market. Whether that pull out happens sooner or later depends probably as much on why it will happen as anything else. The U.S. could get out because it wants to or because it has to and with protests in Iraq and talk back here about troop reductions coming up in Iraq, it could play out either way. For a look at what's really going on we're joined now from Washington by Rick Barton of the Center for Strategic and International Studies. He's co-director of the post conflict reconstruction project. Rick, welcome to the program. Nice to have you with us.
RICH BARTON, CSIS: Nice to be here.
CAFFERTY: What's going to drive the decision to pull out of Iraq? The protests over there looked a little nasty, but then television has a way of capturing the essence of nasty. Do they really want us out over there and does the Pentagon really have serious plans to get troops out of there soon?
BARTON: I think there are two consensus items in Iraq. One is that they would like the foreigners out and the other is that they would like the place to be safer so they can get about their daily lives. Those two items don't come together very comfortably and so you have a mix of public opinion. Clearly, it's not going to be just what the United States wants or just what the Iraqis want, but probably we do to hear the Iraqi voice more clearly than we have let it penetrate our thinking so far.
LISOVICZ: OK, so let's address one of those key issues, safety, security. For instance, can you drive from the airport to Baghdad safely? Do planes still have to do that weird corkscrew maneuver? Is there electricity? Is there plumbing? What's it like in Baghdad and in Iraq right now?
BARTON: We're not doing well in any of those particular items and Baghdad is probably the tipping point. If we can't get it right in Baghdad, even though there are things going on in other parts of the country that are better and there are other parts of the country that are worse, Baghdad is the key fulcrum for this whole issue because it's one third of the population. It's the crossroads for the country. It has each of the ethnic groups well represented there and no, you cannot drive safely from the airport. Planes are still landing in funny ways and the other issues that you raised are still kind of works in progress. So the ongoing problems are very much there.
SERWER: Rick, what's your take on transitioning to a multilateral force, dare I say the word United Nations. I know that some people don't like to hear that, but to a lot of other people, especially around the world, it makes a lot of sense that the U.S. is replaced by a U.N. force. Your take?
BARTON: Well, the U.S. would welcome other nations. We would welcome the United Nations at this point but that, neither of those things are going to happen. We're losing member nations. Of those that have been committed from the beginning are giving us firm dates when they're going to leave, so we have a growing problem. The issue for the Iraqis is if you're going to have 150,000 foreign soldiers in your country, are they making the place safer? And a lot of people think that that is not the case, has not been sufficiently the case, has not been sufficiently the case and that also there's a political dimension to this thing because they are so far out of the control of the Iraqi authorities, so we say we have an authentic Iraqi government but then you have essentially this large force that doesn't respond to their orders. CAFFERTY: But in terms of making the country safer, there's - the conventional wisdom is that the Iraqis themselves are nowhere near ready to take over their own security. Is there actually a credible school of thought in Baghdad that if the United States left, that the country would somehow be safer?
BARTON: I don't think most people have confidence in that. But what might be the possibility, the reason that we should be considering something like a referendum perhaps that would give the Iraqis a vote on a gradual withdrawal, is that we might separate out the nationalists from the jihadists and to do that would be a very healthy thing.
LISOVICZ: OK, Rick. Also what would be healthy if the economy was working on all cylinders. For instance, it's very important oil production. How is that doing? What about Iraq's massive debt? Are those issues being addressed?
BARTON: Those issues are not moving ahead as well as we would like. The oil production is lower than we had expected at this time. But of course, the oil prices are much higher than almost everybody had projected. So, there's kind of a net zero in that regard. With these oil prices, if we had gotten the production up to what we wanted, this would be a much less costly venture for the United States than it has been up to now. In terms of the debt, the United States has taken a very constructive leadership position saying that the world should forgive this and we should essentially look at this as a bankruptcy, a national bankruptcy, that Saddam Hussein took the country beyond the tolerable point. That is, so that issue is moving along although it hasn't been finally resolved.
SERWER: Well, I hope that they are not subject to our new bankruptcy law here that just passed, Rick, because then they won't be able to do that. Just getting back to this national presence of U.S. troops. If there's a national referendum though, isn't that a slam dunk for the U.S. because the Shia and the Kurds outnumber the Sunnis?
BARTON: I think it would -- there's very strong national feeling that the foreigners, that they're capable people in Iraq and that they should be given that ultimate responsibility. I think it would really come down to what the time line that would be offered in the referendum. What I like about it is, Sunnis did not participate in the last election. Many of them were kept from participating. They claim that they will not participate until there is a withdrawal of foreign forces. So it really calls that question. It makes everybody play in the game at the same time as opposed to the kind of fractionalization that is really the leftover effect of the Saddam regime.
CAFFERTY: I'm going to put you on the spot a little bit and we're out of time Rick, but what's your best guess on how soon we can see some American soldiers coming out of that country?
BARTON: I think significant numbers we are probably looking at a -- under our present course a three to five year time line. I think it should be faster than that. CAFFERTY: Rick Barton, co-director of the post conflict reconstruction project. He's with the Center for Strategic and International Studies, Washington, D.C. Rick, thank you.
BARTON: Thank you. My pleasure.
CAFFERTY: When we come back on IN THE MONEY, if the bank can't protect your identity, then who can? We'll look at whether insurance against identity theft is a good idea.
And hogs and bucks. See if the latest new from Harley-Davidson is revving the stock up or slowing it down. Plus, measure your footprint. Find out how big a mark you leave on the planet as you go about your daily affairs. That's in our fun site of the week coming up.
(COMMERCIAL BREAK)
CAFFERTY: The term identity crisis has taken on a whole new meaning in this high tech age and that's because identity theft is a huge problem with very big consequences. Now companies are even offering products to protect your name and information from this threat. The question is, are these products worth the money? Mari McQueen is the senior editor at "Consumer Reports" magazine and she joins us now to talk a little about among other things, identity theft insurance. Mari, nice to have you with us.
MARI McQUEEN, CONSUMER REPORTS: Thank you.
CAFFERTY: How does this insurance work?
The way the insurance works is that for a premium of about $50 a year or more when it's sold as a separate policy. You get coverage in the event that you are a victim, but the coverage generally covers only the related costs of cleaning up your, clearing up your name. They pay for postage, phone calls. Some of the better policies might cover lost wages if you have to go to court or take time off of work. But they don't actually reimburse you for the, any out-of-pocket loss stemming from the crime.
SERWER: So does it make sense to you Mari to get that? I mean obviously this is a red-hot topic right now. People want to know this kind of stuff.
McQUEEN: Well, "Consumer Reports" doesn't feel that this is worth paying for as a separate type of insurance. Single-cause insurance products in general aren't worth the money and in this case, it's a lot of expense for a relatively small benefit because the largest cost to the consumer of identity theft is usually the time that it takes to clear up the problem which is anywhere from 60 to 600 hours depending on the source you are using for an estimate. Generally speaking, consumers have found it takes as long as two years to completely clean up your file and completely clean up your credit.
LISOVICZ: I can handle the shipping costs. U.S. postage stamps aren't that expensive just yet. Do you think it's a better way to go to look into, for instance your home insurance, that might have a rider? Is that the better way to go?
McQUEEN: Yes, many home insurance products, homeowner insurance policies will have an endorsement either as part of the policy itself. You may be covered for any losses stemming from identity theft or you can buy additional coverage as an endorsement on the policy. And in addition, people who have chosen to pay for credit monitoring services, which is also something that we don't recommend, but if you have been a victim, some people will want to do that so that they can monitor their credit accounts on an ongoing basis. Many of those credit bureaus these offer that service are throwing in identity theft insurance as part of, you know, the product. So that's another way to go, another reason you wouldn't need to buy it separately.
CAFFERTY: You mention the cost associated with cleaning up the files. This can be a very difficult and time-consuming and complicated process. Do these insurance policies include the cost of lawyers? And it occurs to me that under certain circumstances, you might need an attorney to get this thing all the way back to ground zero.
McQUEEN: Some of the ID theft policies do. But as I say, you have to read very carefully because that would be one of the more useful coverages would be attorneys fees, and/or the cost of court costs, et cetera. But not all of them offer that and so that's another thing for consumers to look at if they are considering buying an I.D.-theft policy. That's something to look for.
SERWER: Hey, Mari, we have seen all these headlines over the past couple days. I am wondering, are we starting to get to a hysteria level here? I mean is this story kind of being carried by the news media a little too far? Is there really this huge surge in identity theft?
McQUEEN: Unfortunately there really is a huge surge in identity theft. The FTC, when they did their estimate of the problem back in 2003, which was the first time they actually did a comprehensive survey, they said 27 million Americans had already become victims and that it was the fastest-growing financial crime in the United States. So I don't think that people are blowing this problem out of proportion.
The thing is that traditionally, that estimate by the way was about 10 times as high as their previous estimates. So it's a much larger problem than authorities thought. And, the source of it, you know, traditionally, people have said that it was from lost and stolen wallets or dumpster divers going after your personal papers that were not shredded and discarded in the trash and a lot of that does go on, but as you have seen with the headlines recently, with the Choicepoint break in and the Lexis/Nexis problem, when people are stealing identities and personal information now, they are stealing it for thousands and hundreds of thousands of names at a time and even though all of the people whose identities have been compromised, whose information has been compromised, haven't yet reported that they were victims, the fact is that some unknown person, until the crime is solved has their name, their Social Security number and their birth date. So they could become victims at any time because that information generally speaking is not going to change. Your address may change but your Social Security number and your birth date and your mother's maiden name, these things don't change.
LISOVICZ: All right. Mari, so consumers are getting a lot smarter very quickly. We have all of these types of insurances that are out there to prevent it. What is Washington doing? Is it doing anything?
Well, Consumers Union, the parent organization of "Consumer Reports," doesn't feel that they have done enough. One thing that we would like to see is a national, a Federal law that would require companies and institutions to notify consumers when their personal information has been compromised. So far only the state of California has such a law and many of these large-scale thefts of data have come to light because of that state law.
SERWER: All right, Mari McQueen, senior editor at "Consumer Reports." Thank you for coming on the program. Obviously topic A right now, thank you.
McQUEEN: You are welcome.
SERWER: Coming up after the break, the bike that's more than a bike. Harley-Davidson is a brand on wheels. See how its latest news is affecting the stock.
Also ahead, washed up work force. Economist Richard Florida says the talent pool is draining. He will explain how the U.S. can win back the best and the brightest.
And waiting for the white smoke? Allen Wastler of money.com will look at a place where you can bet, bet on the next pope.
(COMMERCIAL BREAK)
LISOVICZ: Now let's take a look at the week's top stories in our money minute. The bankruptcy bill is on its way to the president's desk. The House approved the reform legislation Thursday afternoon. The vote was 302-126. The Senate OK'd the measure last month. The president is expected to sign it into law early next week. The bill will make filing for bankruptcy more difficult. Nearly 1.6 million people filed for bankruptcy in 2004 alone. Talk has run out on procrastinating taxpayers. The deadline to get your tax returns in the mail rolled in at midnight, Friday. The IRS estimates that 13 million people wait until the last day to send in their returns, this reporter included.
And IBM investors are feeling a little blue. The company reported first quarter earnings Thursday that were weaker than expected. IBM blamed a slow down in sales last month for the shortfall. IBM shares took a hit, a big hit on the news.
SERWER: Also making headlines this week, a rough ride for Harley- Davidson. The motor cycle maker slashed its profit and production targets this week, blaming flat U.S. sales. Shares went downhill fast falling 17 percent on Wednesday, the greatest percentage drop in 13 years. That makes Harley-Davidson our stock of the week. This company had a great ride pun intended. For the longest time, it sold to guys with midlife crises. The average age of a Harley rider is 50 years old. The kids go to college, and you tell your wife I am buying a Harley. I'm sorry, Susan.
LISOVICZ: I have a girlfriend who rides a hog, OK.
SERWER: There are women riders, OK.
CAFFERTY: What happened? There was a waiting list to get these things a couple of years ago. You couldn't get a Harley-Davidson unless you agreed to put your name on some list. Now all of a sudden, they're announcing production cutbacks. Their earnings are going to be flat. What happened?
SERWER: Well, people were understanding if there was ever going to be a saturation point. The company would say no, because you're always going to have a new crop of 50 year olds.
CAFFERTY: Of insecure middle-aged men, an endless supply.
SERWER: Yes there is. But I think that that may be part of the problem. They're a victim of their own success also. I mean the stock for instance has gone from $10 to $46 even after the drop over the past 15 years. On and on and on with the merchandising, the T- shirts. And at some point, you are going to hit a wall and the company hit the wall.
LISOVICZ: It was such a darling too. It was ready for a fall. On Wednesday when that news was disclosed, it is also the day when we got the retail seams weaker than expected. The market, the Dow ended the day triple digit loss. Harley ended the day down with a new 52- week low, down 17 percent, one of the most actives and the biggest fall in the company's history. One of the problems that has analysts worried, is credit losses too. People that were buying Harleys aren't able to make their payments.
CAFFERTY: How much does a motorcycle cost these days? They're a lot, right.
SERWER: They're $15,000 to $20,000. I could be wrong.
CAFFERTY: Not like when we were kids.
SERWER: You hit on something very important because their finance business, like GM and like Ford, they have a big finance business. It's a very important and very profitable part of that company. And analysts have been saying they are getting too much money doing loans, and not as much money as people think selling bikes.
CAFFERTY: Could you get the oil situation into a conversation about Harley-Davidsons? They get 70-80 miles to a gallon versus cars. If you don't mind cleaning the bugs off your teeth, it's a way to save a few dollars.
SERWER: I think, I really think these were weekend warriors Jack. These are people - they got a car. They probably have a big pick-up truck or something to go with it.
CAFFERTY: A Hummer.
LISOVICZ: Predictably the company blamed the short fall in sales to the delay of spring weather. So you can't ride a Harley if you are in Minnesota.
CAFFERTY: It's always the weather right.
LISOVICZ: That's right.
CAFFERTY: It's always the weather.
LISOVICZ: If you are the selling something, you can blame it on the weather.
CAFFERTY: It's an emotional story. Harley-Davidson - they should always do well.
LISOVICZ: An American icon.
CAFFERTY: They should just always do...
LISOVICZ: One of the names of their hogs is Fatboy. That's classic.
SERWER: Or six pail (ph). That's another one actually, but at a Milwaukee concert, I remember the CEO (INAUDIBLE) used to ride those thing things.
CAFFERTY: Did they make those t-shirts that read, if you can read this --.
SERWER: Yes they do. I don't know, we shouldn't say it.
LISOVICZ: They also say something like put your butt on some class, but instead of butt, it rhymes with class.
SERWER: They're telling me to wrap this up and I'm going to wrap this up.
Coming up on IN THE MONEY, maybe there's something in the water. We'll speak with an author who says that Austin, Texas, that's longhorn country, is the top U.S. city for business creativity.
And later, finding a job that fits. Get the low-down on a new magazine that might be able to help.
(COMMERCIAL BREAK
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Aired April 16, 2005 - 13:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ZAIN VERJEE, CNN CORRESPONDENT: ..discovered the body not far from Lunde's home. It was partially submerged in water at an abandoned fish farm. Authorities have notified Lunde's family. We're going to bring you a live report coming up on CNN live on Saturday at 2:00 p.m. Eastern.
Protesters in Washington are calling on the G7 ministers to drop the debt of developing nations. Demonstrators are rallying this hour in Washington as the International Monetary Fund and the World Bank hold their spring meetings. Police have expanded their security barriers around the headquarters of the IMF and the World Bank.
Two government reports find security at U.S. airports is no better under Federal control than it was before September 11th. That's according to Congressman John Mica of Florida. He was briefed on the two reports by the government accountability office and the Homeland Security Department.
And at the Vatican, Catholic cardinals prepare for Monday's conclave. The official nine day mourning period following the funeral of Pope John Paul II ended today. Cardinals marked the day with a mass. They also destroyed the late pope's ring and seal, signifying the end of his reign. I'm Zain Verjee at CNN Center in Atlanta. We'll bring you more news at the bottom of the hour. IN THE MONEY though begins right now.
JACK CAFFERTY, CNN ANCHOR, IN THE MONEY: Welcome to the program. I'm Jack Cafferty. Coming up on today's edition of IN THE MONEY, pointing to the exit sign. Shiites in Iraq have been calling for a U.S. pull out and the Pentagon is warming up for a troop cut there. See if that adds up to get out time for Washington, D.C.
Also ahead, you and your shadow. Identity theft making big time headlines. Find out if you should bother taking out insurance against it. There is such a thing.
Plus a career that pays off with more than a paycheck, entrepreneurs tell their stories in a brand new magazine. We'll talk to the co-founder to see if we can learn anything about how to make our work life more worthwhile. Coincidentally, that's the name of the magazine.
Joining me today, a couple of IN THE MONEY veterans, my pal, CNN correspondent Susan Lisovicz, my other pal, "Fortune" magazine editor at large Andy Serwer. If you buy the idea that the stock market is a forward-looking instrument, something is troubling Wall Street. ANDREW SERWER, EDITOR AT LARGE, "FORTUNE" MAGAZINE: Yeah, that's particularly correct over the past couple days Jack, where the market has really slid and the immediate proximate cause has been weak retail sales, punk earnings. But I think you're right. It raises larger questions. Are we on the road to recovery? Is the economy picking up steam or are we moving backwards? A couple days ago, it looked like we've been talking about inflation, the economy overheating. Now we're going the other way.
SUSAN LISOVICZ, CNN CORRESPONDENT: And you can add a couple other things to the mix too, because on Friday morning you had import prices rising for the biggest increase in two years. We also had consumer confidence declining for the fourth month in a row. It's a nasty stew out there and you really see it playing out in the stock market.
Also the fears about inflation. On the one hand, you don't want the Federal Reserve to raise rates too aggressively. On the other hand, you don't want the economy to go in a toilet. It's at the early, early stages of the quarterly earnings report cards. Investors, analysts, nobody really knows where the economy is right now and that's where you're seeing - why you're seeing so much anxiety.
CAFFERTY: Interest rates though, historically speaking are still...
LISOVICZ: Low.
CAFFERTY: Low. The housing market is still doing fine. Earnings are not terrible. They expect double digit earnings growth pretty much generally across the board year over year for 2005. But we've got deficits, deficits, deficits, which are driving the dollar lower. We got a trade deficit number that would choke a horse.
LISOVICZ: And oil prices.
CAFFERTY: There are some structural problems that Washington and this economy and this country simply aren't addressing.
SERWER: Yeah, I think that's the real thing is the overlay, as the dismal (ph) scientists call it, which is to say these big problems are out there and you can talk about, oh, there's some small good things happening. There are always great things happening in this country, companies growing and things like that. But you've got the war hanging over and the oil prices and those are real big problems that are going to take a while to sort out.
CAFFERTY: All right. We'll keep an eye on it for you. Sooner or later, America's probably going to pull out of Iraq which would address one of the problems that's probably troubling the stock market. Whether that pull out happens sooner or later depends probably as much on why it will happen as anything else. The U.S. could get out because it wants to or because it has to and with protests in Iraq and talk back here about troop reductions coming up in Iraq, it could play out either way. For a look at what's really going on we're joined now from Washington by Rick Barton of the Center for Strategic and International Studies. He's co-director of the post conflict reconstruction project. Rick, welcome to the program. Nice to have you with us.
RICH BARTON, CSIS: Nice to be here.
CAFFERTY: What's going to drive the decision to pull out of Iraq? The protests over there looked a little nasty, but then television has a way of capturing the essence of nasty. Do they really want us out over there and does the Pentagon really have serious plans to get troops out of there soon?
BARTON: I think there are two consensus items in Iraq. One is that they would like the foreigners out and the other is that they would like the place to be safer so they can get about their daily lives. Those two items don't come together very comfortably and so you have a mix of public opinion. Clearly, it's not going to be just what the United States wants or just what the Iraqis want, but probably we do to hear the Iraqi voice more clearly than we have let it penetrate our thinking so far.
LISOVICZ: OK, so let's address one of those key issues, safety, security. For instance, can you drive from the airport to Baghdad safely? Do planes still have to do that weird corkscrew maneuver? Is there electricity? Is there plumbing? What's it like in Baghdad and in Iraq right now?
BARTON: We're not doing well in any of those particular items and Baghdad is probably the tipping point. If we can't get it right in Baghdad, even though there are things going on in other parts of the country that are better and there are other parts of the country that are worse, Baghdad is the key fulcrum for this whole issue because it's one third of the population. It's the crossroads for the country. It has each of the ethnic groups well represented there and no, you cannot drive safely from the airport. Planes are still landing in funny ways and the other issues that you raised are still kind of works in progress. So the ongoing problems are very much there.
SERWER: Rick, what's your take on transitioning to a multilateral force, dare I say the word United Nations. I know that some people don't like to hear that, but to a lot of other people, especially around the world, it makes a lot of sense that the U.S. is replaced by a U.N. force. Your take?
BARTON: Well, the U.S. would welcome other nations. We would welcome the United Nations at this point but that, neither of those things are going to happen. We're losing member nations. Of those that have been committed from the beginning are giving us firm dates when they're going to leave, so we have a growing problem. The issue for the Iraqis is if you're going to have 150,000 foreign soldiers in your country, are they making the place safer? And a lot of people think that that is not the case, has not been sufficiently the case, has not been sufficiently the case and that also there's a political dimension to this thing because they are so far out of the control of the Iraqi authorities, so we say we have an authentic Iraqi government but then you have essentially this large force that doesn't respond to their orders. CAFFERTY: But in terms of making the country safer, there's - the conventional wisdom is that the Iraqis themselves are nowhere near ready to take over their own security. Is there actually a credible school of thought in Baghdad that if the United States left, that the country would somehow be safer?
BARTON: I don't think most people have confidence in that. But what might be the possibility, the reason that we should be considering something like a referendum perhaps that would give the Iraqis a vote on a gradual withdrawal, is that we might separate out the nationalists from the jihadists and to do that would be a very healthy thing.
LISOVICZ: OK, Rick. Also what would be healthy if the economy was working on all cylinders. For instance, it's very important oil production. How is that doing? What about Iraq's massive debt? Are those issues being addressed?
BARTON: Those issues are not moving ahead as well as we would like. The oil production is lower than we had expected at this time. But of course, the oil prices are much higher than almost everybody had projected. So, there's kind of a net zero in that regard. With these oil prices, if we had gotten the production up to what we wanted, this would be a much less costly venture for the United States than it has been up to now. In terms of the debt, the United States has taken a very constructive leadership position saying that the world should forgive this and we should essentially look at this as a bankruptcy, a national bankruptcy, that Saddam Hussein took the country beyond the tolerable point. That is, so that issue is moving along although it hasn't been finally resolved.
SERWER: Well, I hope that they are not subject to our new bankruptcy law here that just passed, Rick, because then they won't be able to do that. Just getting back to this national presence of U.S. troops. If there's a national referendum though, isn't that a slam dunk for the U.S. because the Shia and the Kurds outnumber the Sunnis?
BARTON: I think it would -- there's very strong national feeling that the foreigners, that they're capable people in Iraq and that they should be given that ultimate responsibility. I think it would really come down to what the time line that would be offered in the referendum. What I like about it is, Sunnis did not participate in the last election. Many of them were kept from participating. They claim that they will not participate until there is a withdrawal of foreign forces. So it really calls that question. It makes everybody play in the game at the same time as opposed to the kind of fractionalization that is really the leftover effect of the Saddam regime.
CAFFERTY: I'm going to put you on the spot a little bit and we're out of time Rick, but what's your best guess on how soon we can see some American soldiers coming out of that country?
BARTON: I think significant numbers we are probably looking at a -- under our present course a three to five year time line. I think it should be faster than that. CAFFERTY: Rick Barton, co-director of the post conflict reconstruction project. He's with the Center for Strategic and International Studies, Washington, D.C. Rick, thank you.
BARTON: Thank you. My pleasure.
CAFFERTY: When we come back on IN THE MONEY, if the bank can't protect your identity, then who can? We'll look at whether insurance against identity theft is a good idea.
And hogs and bucks. See if the latest new from Harley-Davidson is revving the stock up or slowing it down. Plus, measure your footprint. Find out how big a mark you leave on the planet as you go about your daily affairs. That's in our fun site of the week coming up.
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CAFFERTY: The term identity crisis has taken on a whole new meaning in this high tech age and that's because identity theft is a huge problem with very big consequences. Now companies are even offering products to protect your name and information from this threat. The question is, are these products worth the money? Mari McQueen is the senior editor at "Consumer Reports" magazine and she joins us now to talk a little about among other things, identity theft insurance. Mari, nice to have you with us.
MARI McQUEEN, CONSUMER REPORTS: Thank you.
CAFFERTY: How does this insurance work?
The way the insurance works is that for a premium of about $50 a year or more when it's sold as a separate policy. You get coverage in the event that you are a victim, but the coverage generally covers only the related costs of cleaning up your, clearing up your name. They pay for postage, phone calls. Some of the better policies might cover lost wages if you have to go to court or take time off of work. But they don't actually reimburse you for the, any out-of-pocket loss stemming from the crime.
SERWER: So does it make sense to you Mari to get that? I mean obviously this is a red-hot topic right now. People want to know this kind of stuff.
McQUEEN: Well, "Consumer Reports" doesn't feel that this is worth paying for as a separate type of insurance. Single-cause insurance products in general aren't worth the money and in this case, it's a lot of expense for a relatively small benefit because the largest cost to the consumer of identity theft is usually the time that it takes to clear up the problem which is anywhere from 60 to 600 hours depending on the source you are using for an estimate. Generally speaking, consumers have found it takes as long as two years to completely clean up your file and completely clean up your credit.
LISOVICZ: I can handle the shipping costs. U.S. postage stamps aren't that expensive just yet. Do you think it's a better way to go to look into, for instance your home insurance, that might have a rider? Is that the better way to go?
McQUEEN: Yes, many home insurance products, homeowner insurance policies will have an endorsement either as part of the policy itself. You may be covered for any losses stemming from identity theft or you can buy additional coverage as an endorsement on the policy. And in addition, people who have chosen to pay for credit monitoring services, which is also something that we don't recommend, but if you have been a victim, some people will want to do that so that they can monitor their credit accounts on an ongoing basis. Many of those credit bureaus these offer that service are throwing in identity theft insurance as part of, you know, the product. So that's another way to go, another reason you wouldn't need to buy it separately.
CAFFERTY: You mention the cost associated with cleaning up the files. This can be a very difficult and time-consuming and complicated process. Do these insurance policies include the cost of lawyers? And it occurs to me that under certain circumstances, you might need an attorney to get this thing all the way back to ground zero.
McQUEEN: Some of the ID theft policies do. But as I say, you have to read very carefully because that would be one of the more useful coverages would be attorneys fees, and/or the cost of court costs, et cetera. But not all of them offer that and so that's another thing for consumers to look at if they are considering buying an I.D.-theft policy. That's something to look for.
SERWER: Hey, Mari, we have seen all these headlines over the past couple days. I am wondering, are we starting to get to a hysteria level here? I mean is this story kind of being carried by the news media a little too far? Is there really this huge surge in identity theft?
McQUEEN: Unfortunately there really is a huge surge in identity theft. The FTC, when they did their estimate of the problem back in 2003, which was the first time they actually did a comprehensive survey, they said 27 million Americans had already become victims and that it was the fastest-growing financial crime in the United States. So I don't think that people are blowing this problem out of proportion.
The thing is that traditionally, that estimate by the way was about 10 times as high as their previous estimates. So it's a much larger problem than authorities thought. And, the source of it, you know, traditionally, people have said that it was from lost and stolen wallets or dumpster divers going after your personal papers that were not shredded and discarded in the trash and a lot of that does go on, but as you have seen with the headlines recently, with the Choicepoint break in and the Lexis/Nexis problem, when people are stealing identities and personal information now, they are stealing it for thousands and hundreds of thousands of names at a time and even though all of the people whose identities have been compromised, whose information has been compromised, haven't yet reported that they were victims, the fact is that some unknown person, until the crime is solved has their name, their Social Security number and their birth date. So they could become victims at any time because that information generally speaking is not going to change. Your address may change but your Social Security number and your birth date and your mother's maiden name, these things don't change.
LISOVICZ: All right. Mari, so consumers are getting a lot smarter very quickly. We have all of these types of insurances that are out there to prevent it. What is Washington doing? Is it doing anything?
Well, Consumers Union, the parent organization of "Consumer Reports," doesn't feel that they have done enough. One thing that we would like to see is a national, a Federal law that would require companies and institutions to notify consumers when their personal information has been compromised. So far only the state of California has such a law and many of these large-scale thefts of data have come to light because of that state law.
SERWER: All right, Mari McQueen, senior editor at "Consumer Reports." Thank you for coming on the program. Obviously topic A right now, thank you.
McQUEEN: You are welcome.
SERWER: Coming up after the break, the bike that's more than a bike. Harley-Davidson is a brand on wheels. See how its latest news is affecting the stock.
Also ahead, washed up work force. Economist Richard Florida says the talent pool is draining. He will explain how the U.S. can win back the best and the brightest.
And waiting for the white smoke? Allen Wastler of money.com will look at a place where you can bet, bet on the next pope.
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LISOVICZ: Now let's take a look at the week's top stories in our money minute. The bankruptcy bill is on its way to the president's desk. The House approved the reform legislation Thursday afternoon. The vote was 302-126. The Senate OK'd the measure last month. The president is expected to sign it into law early next week. The bill will make filing for bankruptcy more difficult. Nearly 1.6 million people filed for bankruptcy in 2004 alone. Talk has run out on procrastinating taxpayers. The deadline to get your tax returns in the mail rolled in at midnight, Friday. The IRS estimates that 13 million people wait until the last day to send in their returns, this reporter included.
And IBM investors are feeling a little blue. The company reported first quarter earnings Thursday that were weaker than expected. IBM blamed a slow down in sales last month for the shortfall. IBM shares took a hit, a big hit on the news.
SERWER: Also making headlines this week, a rough ride for Harley- Davidson. The motor cycle maker slashed its profit and production targets this week, blaming flat U.S. sales. Shares went downhill fast falling 17 percent on Wednesday, the greatest percentage drop in 13 years. That makes Harley-Davidson our stock of the week. This company had a great ride pun intended. For the longest time, it sold to guys with midlife crises. The average age of a Harley rider is 50 years old. The kids go to college, and you tell your wife I am buying a Harley. I'm sorry, Susan.
LISOVICZ: I have a girlfriend who rides a hog, OK.
SERWER: There are women riders, OK.
CAFFERTY: What happened? There was a waiting list to get these things a couple of years ago. You couldn't get a Harley-Davidson unless you agreed to put your name on some list. Now all of a sudden, they're announcing production cutbacks. Their earnings are going to be flat. What happened?
SERWER: Well, people were understanding if there was ever going to be a saturation point. The company would say no, because you're always going to have a new crop of 50 year olds.
CAFFERTY: Of insecure middle-aged men, an endless supply.
SERWER: Yes there is. But I think that that may be part of the problem. They're a victim of their own success also. I mean the stock for instance has gone from $10 to $46 even after the drop over the past 15 years. On and on and on with the merchandising, the T- shirts. And at some point, you are going to hit a wall and the company hit the wall.
LISOVICZ: It was such a darling too. It was ready for a fall. On Wednesday when that news was disclosed, it is also the day when we got the retail seams weaker than expected. The market, the Dow ended the day triple digit loss. Harley ended the day down with a new 52- week low, down 17 percent, one of the most actives and the biggest fall in the company's history. One of the problems that has analysts worried, is credit losses too. People that were buying Harleys aren't able to make their payments.
CAFFERTY: How much does a motorcycle cost these days? They're a lot, right.
SERWER: They're $15,000 to $20,000. I could be wrong.
CAFFERTY: Not like when we were kids.
SERWER: You hit on something very important because their finance business, like GM and like Ford, they have a big finance business. It's a very important and very profitable part of that company. And analysts have been saying they are getting too much money doing loans, and not as much money as people think selling bikes.
CAFFERTY: Could you get the oil situation into a conversation about Harley-Davidsons? They get 70-80 miles to a gallon versus cars. If you don't mind cleaning the bugs off your teeth, it's a way to save a few dollars.
SERWER: I think, I really think these were weekend warriors Jack. These are people - they got a car. They probably have a big pick-up truck or something to go with it.
CAFFERTY: A Hummer.
LISOVICZ: Predictably the company blamed the short fall in sales to the delay of spring weather. So you can't ride a Harley if you are in Minnesota.
CAFFERTY: It's always the weather right.
LISOVICZ: That's right.
CAFFERTY: It's always the weather.
LISOVICZ: If you are the selling something, you can blame it on the weather.
CAFFERTY: It's an emotional story. Harley-Davidson - they should always do well.
LISOVICZ: An American icon.
CAFFERTY: They should just always do...
LISOVICZ: One of the names of their hogs is Fatboy. That's classic.
SERWER: Or six pail (ph). That's another one actually, but at a Milwaukee concert, I remember the CEO (INAUDIBLE) used to ride those thing things.
CAFFERTY: Did they make those t-shirts that read, if you can read this --.
SERWER: Yes they do. I don't know, we shouldn't say it.
LISOVICZ: They also say something like put your butt on some class, but instead of butt, it rhymes with class.
SERWER: They're telling me to wrap this up and I'm going to wrap this up.
Coming up on IN THE MONEY, maybe there's something in the water. We'll speak with an author who says that Austin, Texas, that's longhorn country, is the top U.S. city for business creativity.
And later, finding a job that fits. Get the low-down on a new magazine that might be able to help.
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