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American Morning
Oil Prices Skyrocketing; Congress Agrees on $3 Trillion Budget Plan; Senate Defeats Bill to Ban Earmarks for a Year
Aired March 14, 2008 - 08:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JOHN ROBERTS, CNN ANCHOR: Fired up.
(BEGIN VIDEO CLIP)
UNIDENTIFIED PASTOR: Hillary was not a black boy raised in a single parent home. Barack was.
(END VIDEO CLIP)
ROBERTS: Barack Obama's pastor compares him to Jesus. We're live with the Obama and Clinton campaign. The "Most Politics in the Morning" on this AMERICAN MORNING.
ROBERTS: Time to politics to tell you about this morning. In fact, that Michigan apparently may be getting closer to some sort of an idea here. Don't know if it's a deal just yet. For re-do of its primary for June 3rd.
KIRAN CHETRY, CNN ANCHOR: That's right, for the Democrats, and then try and get those delegates seated in this all-important race. So, we're going to talk more about that throughout the morning and also the economy. It is the number one issue on voters' minds. And literally, the signs are everywhere.
Breaking news this morning about gas prices going even higher. Today President Bush is headed to New York to deliver a speech on the economy, and to talk about a plan to fix it.
A poll by the "Wall Street Journal" is now showing that close to two-thirds of economists think we are already in a recession. A lot of people are asking exactly why.
For starters, some people stopped shopping. Commerce Department saying retail sales fell more than a half percent last month. More of that money going into mortgages, where rates are rising again, and Washington is stepping in to help with a new plan. All this as oil and gas prices to continue to shock as well. Both in record territory again today. AAA says the nationwide average gas price is $3.28 a gallon.
We're taking a snapshot of the stations across the U.S. this morning. A look at Ann Arbor, Michigan, where regular goes for $3.39 a gallon. In Dallas, Texas, it's $3.19 a gallon.
CNNMoney.com correspondent Poppy Harlow is live at a gas station here in New York. I think we're looking at $3.49 in the city, Poppy?
POPPY HARLOW, CNNMONEY.COM CORRESPONDENT: Yes, that's right, Kiran. We are well above that national average here in Midtown, Manhattan. Keep in mind the drivers that fill up here are taxi drivers and truck drivers and delivery truck drivers. They really have to fill up. Their job depends on it.
I talked to the cashier inside this morning. He said he filled up a van yesterday. It was $108. I just talked to a guy who said he was filling up his truck here and it cost him about $80. I said why not go somewhere cheaper. He said because it's a company car. If I had to fill it myself, I'd cross the river, goes through the Lincoln Tunnel, fill it up in New Jersey, where the average is almost 50 cents less at $3 a gallon. But people are feeling incredible pain at the pump here.
Kiran?
CHETRY: That's interesting. So, they're willing to pay the $6 it takes to go back and forth in the tunnel to save on the gas and let alone the time, some parts of the day, in order to save a little bit of money on the gas prices.
HARLOW: Yes, that's exactly right. And also, this could just be what a lot of people are saying as the tip of the iceberg as we head into those summer driving months. Gas generally gets more expensive in the summer. It costs more for refineries to reformulate it to meet pollution standards. And that is when families take their vacations. That's when a lot of driving happens.
So, people could be seeing higher gas prices. Some experts saying as much as $4 a gallon on average this summer. So, pretty shocking.
CHETRY: Certainly what most people do not want to see. That's for sure. Poppy, thank you so much for being with us.
HARLOW: Sure.
ROBERTS: We've got some new information this morning that Michigan could reach an agreement on a new Democratic primary, perhaps later on today. According to a Democratic source close to the negotiations, it would be a completely new primary. Complete with voting booths and ballots. Not a mail-in one like as being proposed elsewhere.
The state would be reimbursed for the cost of the vote. We done it at no cost, apparently, to taxpayers. Target date of June 3rd because the primary has to come before June 10th. That is the mandated end of the primary season for the Democrats.
The proposal has got to get through the state legislature by next Thursday in order to make that deadline. So, things have got to be moving pretty quickly there in the state of Michigan. Things not going quite as smoothly in the state of Florida, though. There is a new plan to fix the primary problem. It might not get approved, though. Joe Johns tells us why.
(BEGIN VIDEOTAPE)
JOE JOHNS, CNN CORRESPONDENT (voice-over): They're proposing a mail-in election. And in a few special cases, some voters could still go to the polls. So, that's the plan from Democratic Party leaders in Florida, but not so fast. First, Barack Obama and Hillary Clinton would have to agree.
KAREN THURMAN, CHAIRMAN, FLORIDA DEMOCRATIC COMMITTEE: If the candidates do not agree, this is a non-starter.
JOHNS (on camera): Then you'd want the nine congressional Democrats from Florida to agree and they don't. Not at all. They rejected it immediately. It's such a spectacular mess. And you can't help but wonder how we got here.
To hear some Florida Democrats tell it, they got railroaded, then Republicans who control the state capital hijacked their primary election and forced them to do it in January.
SEN. BILL NELSON (D), FLORIDA: It was a Republican legislature and a Republican governor that changed the day.
JOHNS: That's what he says now, but keeping them honest, we looked back at what those Florida Democrats were doing when this idea of moving the primary from March to January was first taking root.
Early on, some Democrats here were very supportive of the idea of changing the primary date. Even though they knew full well that the National Democratic Party might try to punish them for it. In fact, it wasn't a Republican who started this. It was a Democrat. Florida State Senator Jeremy Ring. He's the guy who first, well, engineered the legislation last year.
JOHNS: Were you railroaded?
SEN. JEREMY RING (D), FLORIDA: Well, again, I think it's true to state that even if it's a Republican legislature, even if every Democrat voted against the bill, then, yes, the bill could have passed. But we were not railroaded. There was not opposition to this bill. It was a bipartisan bill and I believe it passed unanimously.
JOHNS (voice-over): Oh, and by the way, the primary date change was buried in a large and popular election reform bill. There's no way Democrats were going to vote against that. Still, a lot of people liked the date change thing in principle. Even the head of the State Democratic Party.
THURMAN: And I, quite frankly, agreed with them on the fact that we wanted to have Florida, who is, you know, what, the fourth largest state, one of the diverse populations in this country needed to have an opportunity to have, you know, their votes heard in the picking of the presidential nominee.
JOHNS: So, where are we today? Even though Florida Democrats officially floated their enhanced mail-in vote idea today, their own state party leader is not optimistic.
THURMAN: I have a feeling that this probably is getting closer to not than yes.
JOHNS: Which means it could still come down to a fight at the convention in August. Joe Johns, CNN, Tallahassee.
(END VIDEOTAPE)
ROBERTS: And coming up here in about 10 minutes' time, we're going to talk with supporters from both the Clinton and Obama campaigns. Congressman Kendrick Meek and Senator Claire McCaskill. That's at 8:15 Eastern here on AMERICAN MORNING. See what they think about all of these proposals and what would fly and what wouldn't.
Kiran?
CHETRY: All right. Well meantime, overnight, Congress agrees on a $3 trillion budget plan. Actually, they're not necessarily agreeing. The House passed a version. The Senate passed aversion. Now it goes to committee. You know how it goes. But anyway, this is for 2009.
Both houses voted to roll back President Bush's tax cuts. But the Senator would keep some cuts for low and middle income families. They're not final because they're more like a blueprint for both houses to work with before coming up with a final budget.
The Senate also soundly defeated a bill to ban earmarks for a year. Obama, McCain, and Clinton among the few who voted for the ban. Earmarks. They're funding money that members of Congress tack on to bills to pay for special projects in their home state. And the ban is a centerpiece of John McCain's agenda. And he vows he's not dropping the issue.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: We will continue to take our fight to the American people. I will have every town hall across this country talk about earmark and pork barrel spending.
I'll make it clear what $35 billion in earmarked pork barrel projects last year meant to the American people, which is a $1,000 tax credit for every child in America. And Americans want a $1,000 tax credit for each of their children and not a $233 million bridge to nowhere in Alaska.
(END VIDEO CLIP)
CHETRY: McCain challenged his opponents to reveal how much they've requested in earmarks. So, Obama released his information, $740 million in spending requests including one for a hospital where his wife, Michelle, works. The Obama camp is pressing the Clinton camp to release its earmark requests as well. We'll double check that number actually.
Later today, the House is expected to vote on a measure backed by Democrats to overhaul the Foreign Intelligence Service Act better known at FISA. President Bush is threatening a veto because the proposal does not provide immunity to telecommunications who participate in the government's wiretapping program.
And last night, House Republicans succeeded in delaying the vote for a day because of a request to meet in secret to discuss the measure.
ROBERTS: Eight minutes after -- almost nine after the hour now. Lots of other stories new this morning. Our Veronica de la Cruz is here now with that.
Good morning.
VERONICA DE LA CRUZ, CNN CORRESPONDENT: Good morning, John and Kiran. And good morning to all of you out there.
Federal prosecutors looking at whether Eliot Spitzer his campaign funds in any of his visits with escorts. The Feds are focusing on hotel and travel arrangements for three trips Spitzer made over the past several months including his rendezvous at the Mayflower Hotel in Washington, the night before Valentine's Day.
If campaign money was involved, it could open the door for a criminal case against Spitzer because it is illegal for politicians to use campaign money for personal expenses.
Well, the IRS has released this year's list of the biggest scams and fishing is at the top. The Internet-based scam is designed to trick people into revealing confidential information like passwords or account numbers, usually on fake websites made to look legit.
The IRS also says scammers are posing as IRS employees who ask for personal information before giving out this year's tax rebates. Already this year, 33,000 fishing scam e-mails have been forwarded to the IRS.
Well, who needs a border fence when you've got a moat? Officials in Yuma, Arizona planning to dig out a security channel on a crime- ridden stretch of the border with Mexico and fill it with water. The program is starting with a 450-acre patch of no-man's-land known as Hunter's Hole. It's become a haven for drug smugglers and illegal immigrants crossing from Mexico into the United States.
And just hours ago, astronauts wrap up a complex space walk. And next on the agenda, getting a robot up and running. The overnight trek outside the space station was the first of five planned for the mission. The crew began putting together the Canadian robot arm named Dexter but couldn't power it up. Managers are sending off a software patch. They hope will get the juices flowing. And from a space port to an airport. Queen Elizabeth is opening the new Terminal Five at Heathrow Airport this morning. The giant terminal will be the main hub for British Airways. It was first proposed 18 years ago. The new complex will expand Heathrow's capacity by 30 million passengers.
It was built on time and on budget with entirely private funding. New video just sent in from there. And that's what's new this morning. I'm going to send it back to John and Kiran.
Hopefully, it's going to ease some of that ingestion and -- you know, I know that you're traveling today. Maybe not to Heathrow but...
ROBERTS: Yes, I'm traveling today and tomorrow.
DE LA CRUZ: OK.
ROBERTS: Not to Heathrow. I'm going the other direction.
DE LA CRUZ: Costa Rica, right?
CHETRY: He's taking the train. Thanks, Veronica.
ROBERTS: Thanks, Veronica. What to do about Florida? That's the big question this morning as a new proposal to redo that state's primary is trying to get approval. We're going to discuss the possibilities with a supporter from each campaign on the Democratic side coming up.
And a growing problem for Senator Barack Obama. It's his pastor. Listen why.
(BEGIN VIDEO CLIP)
REV. JEREMIAH A. WRIGHT, TRINITY UNITED CHURCH OF CHRIST: Barack knows what it means to be a black man living in a country and a culture that is controlled by rich white people.
(END VIDEO CLIP)
ROBERTS: And what the senator has to say about this longtime ally. That's ahead on AMERICAN MORNING.
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(BEGIN VIDEO CLIP)
KAREN THURMAN, CHAIRWOMAN, DEMOCRATIC PARTY: We go into negotiations and I think with what I heard earlier, about Michigan, clearly I think that the DNC and all of us are going to have to join together to put a resolution that we can accept and move on.
(END VIDEO CLIP)
ROBERTS: That was Karen Thurman, who is the chairwoman of the Florida Democratic Party earlier on AMERICAN MORNING, talking about Florida's plan for a new election. While the Michigan Democrats may be closer to getting a deal, you might hear about that today, it's no sure thing.
Both states were stripped of their delegates for moving up their primaries. Could all of this spell disaster for the Democrats in November? Florida Congressman Kendrick Meek is a Hillary Clinton senior campaign adviser who joins us this morning. And Missouri Senator Claire McCaskill is an Obama national campaign co-chair. Both of them are in Washington this morning.
Folks, it's good to see you.
Congressman Meek, let's start with you. The Florida delegation is against this mail-in plan that Karen Thurman has proposed. So if not that, what would you do about Florida?
REP. KENDRICK MEEK, CLINTON SENIOR CAMPAIGN ADVISER: First of all, I would like to say we all commend Karen for her efforts to start this debate as it relates to coming to a resolution. But I can tell you with option out, was not an option right now. That's a full primary. We don't need to introduce anything new to the Florida voter's. We don't need to make another mistake as it relates to the Democratic Party rules.
And so what we're saying is that there was a vote on the 29th. We're counting on the leadership of the Democratic National Committee. It's important to invite all of the delegates to Denver, which has not happened yet. And so we're trying to move not only cautiously but very fast to come to some sort of resolution more sooner than later.
ROBERTS: Senator McCaskill what do you think about that whole idea of no re-vote there in Florida?
SEN. CLAIRE MCCASKILL, OBAMA NATIONAL CAMPAIGN CO-CHAIR: Well, I think what we've got to do, I think the problem is the people in Florida, the leaders in Florida, can't even agree on how to move forward. So to expect two candidates in a very close race to agree when the Democratic leaders can't agree, I think we've got to figure out a way to seat the people of Florida. We've got to figure out a way to hear the people of Florida. We just got to make sure we don't change the rules in the middle of the game.
ROBERTS: OK, so Congressman Meek, you say no re-vote in Florida. What would you do about the delegates?
MEEK: Well, the delegates should be seated. That's up to the DNC right now. They have the option to take away half our delegates or they also have the option to leave it open.
ROBERTS: But would you apportion them according to the vote in Florida?
MEEK: Absolutely. I believe that if we start tinkering around with the Democracy vote that took place in Florida, I think we're going to run into problems. ROBERTS: So that means Hillary Clinton gets the majority of the delegates?
MEEK: Well, she got a super majority of the vote in Florida. No one campaigned in Florida. I think the main issue here was to make sure that the candidates did not go to Florida, versus going to the four early states. I think the four early states received all of the attention that they deserved.
There were great contests that were held there, but I think it's important that we look at the Florida vote, because we have a lot of seniors that are still around and that were around in 2000. They still have tear stains on their face. And I think it's important that we honor that vote and we make sure that we do it in a fair way. So I'm counting on the DNC to stand up and do the right thing.
ROBERTS: Senator McCaskill, let me come back to you for a final point, just that I want to move on. Would you accept portion of the delegates based on the vote from the January 29th primary?
MCCASKILL: John, Hillary Clinton signed a pledge. And anyone can look at it. That said I will not campaign. I will not participate. I will in no way acknowledge the two early primaries. These were the rules. And Barack Obama followed the rules.
Now, Barack Obama wants the people of Florida to be heard from but it's not fair to change the rules now and say I didn't mean my signed pledge that I signed before those primaries occurred.
MEEK: I'm sorry, John. John, that's not what Senator Clinton is saying. When you have 1.7 million voters that went out and voted early, record-breaking on Election Day, record-breaking, we cannot ignore that. I think we lose our white head on election reform, we start talking about rules versus Democracy.
ROBERTS: I guess we have to make one more point here. Congressman Meek, the point many people are making is, had the candidates actually campaigned and campaigned vigorously there in Florida as they would have, had it counted, would the vote turnout have been even greater and would the results have been different?
MCCASKILL: Right.
MEEK: Well, you know, we will never know, because we had a record-breaking turnout. Half a million Democrats showed up to vote prior to election day and on election day, we broke records again. So if it was a low-voter turnout, I would carry that concern. But I don't think that that's the concern right now.
I think that we should be very proud of the kind of turnout that both Democratic candidates has experienced in all of these states that have voted thus far.
ROBERTS: OK. Let me shift gears here and let's take a look at Michigan. Because apparently they're close to proposing a plan and the plan would be for a primary re-do, complete re-do for people willing to self-declare or self-identify as Democrats. Certify that they did not vote in the Republican primary back in January.
This would be not paid for by the state. We haven't quite cleared up the funding of that yet. It would be held June 3rd. Senator McCaskill, could you agree to that?
MCCASKILL: Well, we may. I haven't had a chance. I don't think the people of Michigan have spoken yet. Senator Obama really believes that the DNC, together with these states, should figure out the right way forward. And whatever rules they decide on, we'll abide by them. That's all that Senator Obama has done since day one.
Everyone took their name off the ballot in Michigan except for Hillary Clinton. And obviously, when you compete against no one, you cannot count that primary. That's why we've got to make sure that we figure out a way to hear from the folks in these states, but we do it in a way that's fair.
ROBERTS: Congressman Meek, you agree?
MEEK: Well, I can tell you -- and the senator, we've been doing this for the last couple of days. But I think it's important that everyone realize that Senator Clinton wants to make sure that every voice is heard in the United States of America. If the Barack Obama campaign had their way, they'd be able to shut down this process a month ago.
And any effort to bring about democracy to this process, any effort to continue to follow this trail to making sure that we put forth the best nominee possible, I support 110 percent.
Michigan has an option that Florida does not have. Right now, we're in the middle of the election reform in Florida. Many of our machines have already left. We can't have a full-blown primary in the way we would like to have it.
So, I think that if it's something that the voters are accustomed to, I think if it's something that the government officials there feel comfortable with, it's definitely worth doing.
ROBERTS: All right. Folks, thanks very much for being with us this morning. As I say, we may hear from the Michigan delegation a little bit later on this morning. They're close to an announcement. Florida, I guess, they're going to take another look at that on Monday, see whether or not they can do that mail-in ballot.
Congressman Kendrick Meek from Florida and Senator Claire McCaskill, thanks very much for being with us this morning. Good to see you.
MCCASKILL: Thank you.
ROBERTS: Kiran?
CHETRY: Well, oil prices skyrocketing, gas prices also higher than we've seen. How hard is this going to hit our economy and how soon? We're going to talk about it, coming up. Also, this is no joke. Comedian Al Franken has a pretty serious shot at becoming the next senator for Minnesota. We're going to talk to him about his transformation from comedian to politician, ahead on AMERICAN MORNING.
(COMMERCIAL BREAK)
CHETRY: Welcome back to AMERICAN MORNING. We're taking a look right now at a live picture of a gas station in New York City. This is on 11th Avenue and 47th Street. Just look at the sign. Gas, regular unleaded, $3.49 a gallon in the Big Apple. Oil prices setting records in 12 of the last 13 trading sessions.
And gas prices also setting records. When we look at the AMERICAN MORNING gas gauge, it shows the average national price right now at $3.28 a gallon. That is a record. Last month, it was $2.97. A year ago, it was $2.55. Is there any relief in sight and what can consumers do?
Joining me now from the Fuel City gas station in Dallas, Texas is energy analyst Jim Lacamp.
Jim, good to see you this morning.
JIM LACAMP, ENERGY ANALYST: Thank you, Kiran.
CHETRY: I remember when we were bellyaching last year and now we're way past that mark. I mean, last year we were asking the question, what if the gas goes above $3 a gallon and this year we're asking whether or not it's going to go about $4 a gallon in the foreseeable future. What's going on?
LACAMP: Well, for the long-term, Kiran, I'm very, very concerned that prices could reach that $4 mark. But on the short term, I think we may see some relief, because Americans are finally starting to curtail their driving habits. We hadn't seen that happen until the last four, five weeks.
Secondly, supplies have started to come up. They've built up, as Americans have slowed down driving habits.
So, I do think that over the next four, five weeks, before we get to the summer driving season, we could see prices drop 10 or 20 cents. That being said, the weak dollar has really trumped everything as it pertains to fundamentals with gasoline.
So, if their dollar continues to be weak, and I expect the Fed is going to cut interest rates again on March 18th, that's going to put pressure on the dollar. It may trump all that and if we don't see any relief by the time the summer driving season hits, we could really get it hard this summer.
CHETRY: What about people that can't curtail their driving? We're talking about truckers, taxicab drivers, people that have to fill up to get to work and also the issue of the increase in goods and services because of these charges for shipping that we're seeing need to be absorbed somewhere. And it's usually the consumer that's ending up paying?
LACAMP: Well, you bring up a very good point because diesel prices have gone up even faster than gasoline prices. And diesel prices are really responsible for the costs of shipping of a lot of the goods that we buy in this country. So, you bring up a very good point.
We are seeing drivers start to change their vehicles a little bit. SUV sales are down. The better mileage vehicles have started to increase their sales a little bit, but you bring up a very good point. The taxicab drivers, the trucker, they're not going to get any relief unless everybody else curtails their driving and gets better mileage vehicles. And that would put less pressure on demand and less pressure on supply. But we're only seeing that happen very gradually.
CHETRY: Right. You know, this is all taking place within a political year, of course, and as we've been calling it the number one issue, a lot of voters were saying that concerns about the economy including gas prices are dominating their thinking as they vote.
But is there anything that elected politicians can really do to help with what we're going through right now?
LACAMP: The things that they've done so far, Kiran, oddly enough, have hurt more than they've helped. If you look at ethanol standards, for example, you would think that that would have helped.
But what it's done is it's driven up the price of wheat. It's driven up the price of corn. It's driven up the price of soybean and that's driven up the price of meat. So, it's really caused an increase in inflation.
Secondly, ethanol isn't as efficient as most analysts that are for ethanol would have you believe. Beyond that, we haven't built a new refinery in this country in over 31 years and we've got a lot of problems with our refineries. We've told our oil companies they can't drill off the coast of California. They can't drill in Alaska.
So, politics really have caused more problems than they've solved. If we relax nuclear standards or promoted nuclear energy a little more in this country, that might help. If we promoted development of alternative energy more, that might help. But this ethanol standards, so far, have hurt.
CHETRY: Right. And no one's running on the platform. I'm going to build more refineries and nuclear plants right at your house, right in your neighborhood. Of course, we haven't heard that on the campaign trail. Right, Jim?
LACAMP: I've got a little room in my backyard.
CHETRY: All right. Well, it's great to talk to you this morning. Energy analyst and Senior Vice President RBC Wealth Management Jim Lacamp. Thanks.
LACAMP: Thank you, Kiran. ROBERTS: You're watching the "Most News in the Morning."
Senator Obama's controversial pastor may have him in hot water. But why are videos like this popping up on the web now? That's ahead on AMERICAN MORNING.
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KIRAN CHETRY, CNN, ANCHOR: And welcome back to AMERICAN MORNING. I'm so glad on this Friday we can at least have a little snippet of good news about the economy.
JOHN ROBERTS, CNN, ANCHOR: Wouldn't that be nice? Because the news has been so bad lately. Gas prices up and all that and foreclosures. But this just in to CNN. Away on "Issue number one" in America, the new inflation numbers are out and Ali Velshi has got them for us, and for once, Ali, not bad news?
ALI VELSHI, CNN, SENIOR BUSINESS CORRESPONDENT: People have been not smiling much lately. This is very, very interesting news. Inflation for the month of February is unchanged. Core inflation, that's where you strip out food and energy, unchanged coming in for the year at 2.3 percent. That is lower than what was expected. Even when you put food and energy into the number, it's lower than expected. Now, there are some reasons why one might be skeptical about these numbers given that all we've been hearing about is higher food prices, higher energy prices. But the bottom line, as the government measures it, there was an expectation that inflation would be up, and the numbers as reported are not up right now.
We are looking to see what the reaction from markets will be to this news given that it was wildly expected to be up. Here's where it plays into how it matters to you out there. If inflation had increased which was what was expected, that sort of gives the Fed another problem when it cuts rates next Tuesday, as is widely expected, because cutting rates fuels inflation. It makes money cheaper to borrow and easier to borrow. It creates demand and it fuels the inflation. With this inflation reading, it probably plays into the Feds hand and allows them to probably stick with the decision to cut rates next Tuesday.
So, loans will get a little bit cheaper next Tuesday when the Fed meets and cuts rates. At the moment, the reading on inflation is lower than expected. Dow futures were down about 80 points just before this reading. They are now up heading well up, probably about 50 points right now. We'll see where it all settles in.
Yes, one piece of good news in all of this doom and gloom about high oil prices, high gold prices, low dollar and high gas prices. We're going to be talking a lot more about this, John, by the way, all next week and this weekend. If you tune into "Your Money" on Saturday's at 1:00 p.m. and Sundays at 3:00 p.m., Christine Romans and I will get into details about inflation. Because even though these numbers come in the way they do, Americans are feeling the pinch. They're paying a lot more at the stores, John. ROBERTS: But here comes the little cloud in the silver lining here, Ali. Of course, if the Fed cuts rates again that could have another downward effect on the dollar? Yes?
VELSHI: Which and yes, that's absolutely true, and when the dollar gets cheaper because we import so many goods, some of those goods get more expensive. That, again is inflation. It also pushes the price of oil higher. So, this still remain as a double-edged sword, there's just a little clearing. There's a little ray of sunshine coming down and shining on us for a moment.
ROBERTS: And so many people who believe that double-edged sword is going right through their sternum. All right. Ali, thanks very much.
And as Ali mentioned all next week on CNN, were following "Issue number one, the economy." We'll have more information about your savings account, your debt, your mortgage and your job. Don't miss "Issue Number One" at noon Eastern all next week, right here on CNN.
CHETRY: Also, new this morning, the house and the Senate each passed a budget, a plan, at least, for 2009 calls for $3 trillion in spending. The plan would let most of President Bush's tax cuts expire in the next few years, except those for low and middle-income families. The House and Senate still need to agree on one final version of the budget before sending it to the president.
And we're getting word this morning that Michigan may actually be close to a plan for a new Democratic primary. Democratic sources close to the negotiations telling CNN this morning that the new primary could be held on June 3rd at no cost to taxpayers. Under the plan, it would be paid for by Democratic donors.
Also this morning, there is some new information in the sex scandal involving New York Governor Eliot Spitzer. CNN has learned that federal investigators are looking into the source of unaccounted for payments to the prostitution ring. Investigators are looking into the possibility that some of that money may have come from campaign funds. It is against the law for officials to use campaign money for personal uses.
And NASA's getting ready to send a software patch up to the International Space Station to get a robot's juices flowing, I guess you could say. Overnight, astronauts began assembling a new Canadian robot arm and they couldn't get it to work. Managers are hoping the new software does the trick. Without electricity the arm will stay cold which could damage its joints.
ROBERTS: He has a history of making inflammatory remarks about race and the United States. He is Jeremiah Wright. He is Senator Barack Obama's pastor and his sermons are spreading on the web. Here's CNN Susan Roesgen.
(BEGIN VIDEOTAPE)
REV. JEREMIAH A. WRIGHT, TRINITY UNITED CHURCH OF CHRIST: Who cares about what a poor black man has to face every day in a country and a culture controlled by rich, white people.
SUSAN ROESGEN, CNN CORRESPONDENT (voice-over): This is Reverend Jeremiah Wright preaching one of his last sermons at Senator Barack Obama's Chicago church on Christmas day. The church records and sells video of its Sunday services and this one is getting a lot of hits on youtube.
WRIGHT: It just came to me with -- within the past few weeks, you all, why so many folk are hating on Barack Obama. He doesn't fit the model. He isn't white. He isn't rich, and he isn't privileged. Hillary fits the mold.
ROESGEN: This is the kind of message the Obama camp does not endorse. Asked for reaction, a campaign spokesperson said, Senator Obama has said before that he profoundly disagrees with some of the statements and positions of Reverend Wright. Nevertheless, the sermon is picking up steam. The Reverend goes on to compare Senator Obama to Jesus, and while the message seemed inspirational to his congregation, some will find it inflammatory.
WRIGHT: Hillary was not a black boy raised in a single-parent home. Barack was. Barack knows what it means to be a black man living in a country and a culture that is controlled by rich, white people! Hillary can never know that. Hillary isn't never been called a [ bleep ]! Hillary has never had people defined at non- present.
ROESGEN: Senator Obama who has been a member of this church for 20 years, has said that Reverend Wright is like an old uncle who sometimes will say things he doesn't agree with and what's more the campaign also says, "Senator Obama deplores divisive statements, whether they come from his supporters, the supporters of his opponent, talk radio, or anywhere else." A spokeswoman for Senator Hillary Clinton's campaign said she had not seen this video clip but that the campaign's first reaction was simply, no comment.
(END VIDEOTAPE)
ROESGEN: We tried to reach Reverend Wright to get his reaction now to the fallout from his fire and brimstone sermon, but we're told he's on vacation, and not available. Susan Roesgen, CNN, Chicago.
CHETRY: Well, comedian Al Franken might be best known for his "Saturday Night Live" character Stuart Smalley to some. Take a look.
(BEGIN VIDEO CLIP)
AL FRANKEN: I'm going to do a terrific show today, and I'm going to help people, because I'm good enough, I'm smart enough and doggone it, people like me. Hello.
(END VIDEO CLIP)
CHETRY: Hello. He now wants people to like him, of course, in a new way. He's running for the senate in Minnesota and more than likely to be the Democratic nominee. Al Franken joins us now from Minneapolis. Are you sick of seeing that yet?
AL FRANKEN (D), MINN. SENATORIAL CANDIDATE: Well, fortunately I didn't see it. I'm -- we don't have a monitor here, but, no. I really am proud of that character. In fact, the movie "Stuart saves his family" is used by rehabs all over the country, and in their, especially in their family programs. I'm very proud of that movie.
CHETRY: How do you -- when you go out there and campaign, how do you make that transition and make the voters of Minnesota know that you used to be a comedian, but now you're a serious politician who thinks you can do well for that state?
FRANKEN: I -- this has not been a huge problem, when people hear me speak, they know I take the issues very seriously. They hear me speak from my heart, and my gut and my brain. So it hasn't been a problem, and that's why I'm really in a very good position now to be the nominee and to take on Norm Coleman.
CHETRY: Speaking of taking on Norm Coleman, the national Republican congressional committee described you as "one of the most extreme and radical candidates for public office in years. Al Franken's mean-spirited and nasty partisanship is a clear contrast from Norm Coleman.
Now, he's saying that he's the moderate in this. That he's only voted with his party 77 percent of the time. How can you prove that you're not really a partisan candidate, that you can be a senator for all people including conservative Republicans in your state?
FRANKEN: Well, that attack on me is something that I expect, and it sound kind of partisan to me. Does it sound kind of partisan to you, Kiran?
CHETRY: Well, I mean, it's coming from the Republican congressional committee describing you.
FRANKEN: Now, look.
CHETRY: They're trying to paint their candidate, let's put it this way, as someone who is maybe more modern and inclusive.
FRANKEN: Look, Norm Coleman pretty much told the people of Minnesota where he was at six months after he became senator, six months after Paul Wellstone died, he said to roll call, "to be the blunt, I'm a 99 percent improvement over Paul Wellstone. When he apologized three days later, he said what I meant was I'm a 99 percent improvement over Paul Wellstone in terms of supporting this White House, and he was attached at the hip with President Bush. He voted with the White House 98 percent of the time the first year.
He, you know -- when you talk about seriousness, here's a guy whose policy on the war is to stay the course. His policy on the economy is to stay the course with the Bush economy. Minnesotans want serious solutions to these problems. Staying the course is not serious. And, you know, Tip O'Neal had a word or a phrase for moderates like Norm Coleman. They're always there when you don't need them. He's always looking, he's never the 51st vote on any issue. He always looks for cover and now to seem like he's not supporting the president, he votes against him when he has cover.
CHETRY: You quoted something Norm Coleman said. You've said some controversial things in the past. You wrote a book called "Rush Limbaugh is a big fat idiot."
FRANKEN: And other observations.
CHETRY: You said some things about Karl Rove, and Scooter Libby, saying they should be executed for treason because...
FRANKEN: I did not say that, Kiran.
CHETRY: In a joking manner, in a satirical way?
FRANKEN: No. I didn't even say that in a joking manner.
CHETRY: What did you say?
FRANKEN: I was on David Letterman's show, and he asked me, this is like the day after it was revealed that they had outed, participated in the outing of Valerie Plame and he asked me what's going to happen to him. And I said that President George H.W. Bush before he was president was director of the CIA. And George H.W. Bush said that outing a CIA agent was treason. I said, David, you know what the penalty is for treason. And David asked me what was going to happen to them. I said, so I guess they might be executed which I'm against. I'm against the death penalty. And I'm afraid that Cheney and Bush might be involved in some way, and so we should pass a constitutional amendment to ban the execution of a sitting president, because that would be very demoralizing to the American people. This was, you know -- this is exactly what the Republican party is doing.
CHETRY: Well, this is a - CBS night show quote, just so we're clear, if you say, you were joking around with David Letterman, as a comedian, too. And so basically what it looks like is going to happen is that Libby and Karl Rove are going be executed because outing a CIA agent is treason. Then said you went on to say we should never, ever, ever execute a sitting president. All I'm saying is, when you say things like that in the past, and you're running, obviously those things come up.
FRANKEN: What you said was that I advocated the execution.
CHETRY: I didn't say advocated. I didn't actually say you advocated. I'm just talking about when you say things in the past that can be perceived as divisive, how to you then come together and say, you know what I can be a senator for everyone in the state?
FRANKEN: Because people know the difference between being a satirist and the whole point of that was to show that outing a CIA agent is serious. That's what a satirist does. A satirist points out what is actually serious, and -- but, you know, the trick here is they are going to be taking things out of context, and you're right. The Republican party in Minnesota said that I advocated the execution. Of those guys. And I wasn't. And it was very clear, the Letterman audience and anyone who saw that, and, if -- this is just ridiculous. We should be talking about foreclosures on homes. We should be talking about gas prices. We should be talking about loss of jobs, and that's what I'm going to do.
CHETRY: No, I agree.
FRANKEN: The reason they want to do this kind of distraction is that Norm Coleman has such a terrible record on these things. So I'm not going to let them do that, and then when they say that I advocated these things they're only shooting themselves in the foot. They came out with this the day I announced. The day I announced the first poll came out said I was 22 points down from Norm Coleman. The last poll has me three points ahead of Norm Coleman. This doesn't work. And if they -- let them continue to do this. I'm going to talk about the problems that face Minnesotans. I'm going to talk about getting universal health care. Go ahead.
CHETRY: Right. Before we let you go, one of the top issues that we've been talking about is the economy, of course. The 70-plus percent of economists say it looks like we're in a recession. If you were elected, what would be some of the first things that you would do to try to turn the economy around?
FRANKEN: Well, the first thing I would try to do is to put a moratorium on foreclosures. Staunch this downward spiral. You know, every house that 's foreclosed upon goes on the market. That's why we've had the floor fall out of the housing market. I would also make sure that people have jobs. I didn't like this stimulus package. I would have used the stimulus package to address deferred infrastructure projects, like roads.
You know, there's plenty of infrastructure projects in this country that are short term. We could have put people to work, repairing them, they could have -- they would have had jobs. Those jobs would have created more jobs, because they'd be spending money and at the end we'd have repaired infrastructure. We can do that by fixing up foreclosed housing, b y retrofitting homes to make them more energy efficient, by making sure that states aren't laying off teachers and nurses and firefighters and police, so we could pulse money back to the state.
And then long term, we have to do research and development, end this Bush war against science. We have to build an economy that works for everybody and a green economy that creates jobs and gets us off energy dependence on -- and that's why the price of gas, the price of oil, is so much that we've done nothing in the last seven years to get off our dependence on foreign oil. And Norm Coleman has done nothing about it, and President Bush has done nothing about it.
There are things that we can do to pulse the economy now and then there are long-term things that we have to do to get into the 21st century and get a handle on health care is one of them. We spend twice as much money per person on health care as any other industrialized country. We need universal health care. We need an education system that trains our kids for a 21st century economy. We need to restore our standing in the world. A lot of reason for the increase in oil prices is the war in Iraq, and the uncertainty in Iran.
CHETRY: Right. You know, what, I'm getting told we have to go. But I really appreciate you weighing in on these issues. You're welcome any time. Al Franken, U.S. senatorial candidate out of Minnesota. Thanks for being with us this morning.
FRANKEN: Thanks, Kiran.
CHETRY: By the way, once quick note. We also did invite Senator Norm Coleman to appear. Open-end invitation still stands for next week.
ROBERTS: Perhaps we'll get him on too.
Twelve minutes now to the top of the hour. Another "Fit Nation" success story. We're going to meet a woman who went from 300-plus pounds to triathlete. I wonder how she did it, coming right up.
(COMMERCIAL BREAK)
ROBERTS: Nine minutes to the top of the hour. This week's "Fit Nation" report. The story of Sherry Coulombe, she has accomplished something most of us couldn't dream of doing, and she did it after losing half of her body weight. Our Dr. Sanjay Gupta has got her story.
(BEGIN VIDEOTAPE)
DR. SANJAY GUPTA, CNN, CHIEF MEDICAL CORRESPONDENT (voice-over): The Iron man triathlon. Swim 2.4 miles. Bike 112. And run a full marathon. It's grueling for anyone. But a 348-pound, 29-year-old Sherry Coulombe never dreamed she could even come close.
SHERRY COULOMBE, TRIATHLETE: My life was miserable. I couldn't walk down the hallway without losing my breath.
UNIDENTIFIED MALE: You know, there's a risk of getting --
GUPTA: Her weight also interfered with her ability to get pregnant.
COULOMBE: That was the turning point.
GUPTA: She underwent gastric bypass surgery at Dekalb Medical Center in Atlanta where doctors shortened her digestion tract to limit her calorie intake.
COULOMBE: By the time, I had the surgery I was 25 and I didn't think I was going to my 30th birthday.
GUPTA: She lost more than 150 pounds in nine months, but it wasn't easy. COULOMBE: You know, it's hard to go from eating a big plate of food mentally to eating something that fits inside of a dixie cup.
GUPTA: And there can be major risks involved with the surgery, such as anemia, vitamin deficiencies and dumping syndrome, where the body passes food too quickly causing nausea and weakness. Rarely bothered by side effects, Sherry is now almost 170 pounds lighter and an accomplished triathlete. Something she never imagined possible.
COULOMBE: I'm still the same person, just a more confident person and a more active, and a more healthy person.
GUPTA: Dr. Sanjay Gupta, CNN, reporting.
(END VIDEOTAPE)
ROBERTS: So, why is it so hard to lose ten pounds? You can also catch Sanjay this weekend on his own show "House Call," Saturday and Sunday mornings at 8:30 Eastern, right here on CNN. We'll be right back after this. So, stay with us.
(COMMERCIAL BREAK)
CHETRY: You know, earlier in the show, we told you about a website called juicycampus.com. Basically, a message board for college campus rumors. Some may be true, but many are hurtful lies and some of the victims say that they're looking to take legal action. And it brings us to a final check of this morning's "Quick Vote." Do they have even have an option? Should you be able to sue a website that allows people to post lies about you? 76 percent saying yes. 24 percent saying no. To all who voted, thank you.
ROBERTS: Lots of news ahead this morning on CNN NEWSROOM. And a look now at what they're working on for the top of the hour.
TONY HARRIS, CNN, ANCHOR: See these stories in the CNN NEWSROOM.
The economy and inflation. New numbers just out on consumer prices. Gas surges to a new national record high. State Democrats pessimistic about the chances of a primary revote in Florida. Astronauts hook up a robotic arm to the space station, but there's a problem. And a baby, shaken violently. Her nanny facing abuse charges. NEWSROOM just minutes away and at the top of the hour on CNN.
(COMMERCIAL BREAK)
ROBERTS: Quick reminder for you this morning, all next week on CNN, "Issue number one. The economy." We'll have information about your savings account, your debt, your mortgage, your job and a whole lot more. Don't miss it. "Issue number one," at noon Eastern, all next week here on CNN.
CHETRY: You're going to miss "Issue number one." You're going to be having a little bit of fun.
ROBERTS: I will be watching it from far away.
CHETRY: Are you really going to watch us?
ROBERTS: Absolutely. That's the great thing about CNN. It's everywhere!
CHETRY: Including the small jungles or beaches of Coast Rica? Well, enjoy. We'll miss you.
ROBERTS: I've only been to Costa Rica once before. So, it will be a lot of fun.
CHETRY: Take pictures. Send i-reports.
ROBERTS: Thanks so much for joining us on this AMERICAN MORNING. You got her all next week.
CHETRY: And meanwhile, you got Tony Harris and Betty Nguyen, CNN NEWSROOM starts right now.
HARRIS: And good morning, everyone. You are in the CNN NEWSROOM. I'm Tony Harris.
BETTY NGUYEN, CNN, ANCHOR: And I'm Betty Nguyen in today for Heidi Collins. You can watch events come live into this NEWSROOM. It is Friday, March 14th. Here's what's on the rundown, you better hug your wallet because it is having a bad day. Gas tops $4 bucks a gallon in some places. Inflation simmers. The dollar sinks. The list goes on.
HARRIS: And on and on.
Will Democrats get a presidential primary do-over in Florida? How about Michigan? The realities of a revote.
NGUYEN: Iraqi soldiers, they're stake in the U.S. presidential election. Kyra Phillips on assignment in Baghdad, in the NEWSROOM.
HARRIS: Payday for many Americans, but that paycheck keeps shrinking. Gas is up again today, selling for more than $4 a gallon in two states and oil once again set a new record.
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