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Fed Chairman Testifies on Capitol Hill; United Airlines Grounds all Boeing 777s; FMR. Indiana Senator Endorses Obama
Aired April 2, 2008 - 10:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
BEN BERNANKE, CHAIRMAN, FEDERAL RESERVE: In the business sector, the pullback in hiring that I noted earlier has been accompanied by some reduction in capital spending plans as weaker sales prospects, tighter credit and heightened uncertainty have made business leaders more cautious.
On a more positive note, the non-financial business sector remains financially sound with liquid balance sheets and low leverage ratios and most firms have been able to avoid unwanted buildups in inventories. In addition, any businesses are enjoying strong demand from abroad. Although the prospects have for foreign economic growth have diminished somewhat in recent months, net exports should continue to provide considerable support to U.S. economic activity in coming quarters.
Overall, the near-term economic outlook has weakened relative to projections released by the Federal Open Market Committee at the end of January. It now appears likely that real gross domestic product will not grow much if at all over the first half of 2008 and could even contract slightly.
We expect economic activity to strengthen in the second half of the year. In part as a result of stimulative monetary and fiscal policies and growth is expected to proceed at or little above its sustainable pace in 2009, bolstered by a stabilization of housing activity, albeit at low levels, and gradually improving financial conditions.
However, in light of the recent turbulence in the financial markets, the uncertainty attending this forecast is quite high and the risks remain to the down side. Inflation has also been a source of concern.
The price index for personal consumption expenditures rose 3.4 percent over the 12 months ending in February, up from 2.3 percent over the preceding 12-month period. To a large extent this pickup in inflation has been the result of sharp increases in the prices of crude oil, agricultural products and other globally traded commodities.
Additionally the decline in the foreign exchange value of the dollar has boosted some noncommodity import prices and thus contributed to inflation. However, the so-called core rate of inflation, that is inflation excluding food and energy prices, edged down certainly after firming somewhat late last year. We expect inflation to moderate in coming quarters. That expectation is based in part on futures markets indications of a leveling out of prices for oil and other commodities and it is consistent with our projection that global growth and thus the demand for commodities will slow somewhat during the period.
And as I noted we projected an easing of pressures on resource utilization. However, some indicators of plan expectations have risen and overall uncertainty about the inflation outlook has increased.
It will be necessary to continue to monitor inflation developments carefully in the months ahead. I turn now to the Federal Reserve policy responses to these financial and economic developments. Well-functioning financial markets are essential for the efficacy of monitoring policy and indeed, for economic growth and stability.
To improve market liquidity and market functioning and consistent with its role as the nation's Central Bank, the Federal Reserve has supplemented it's long standing discount window by establishing three new facilities for lending to depository institutions and primary dealers. The lending facilities now in place offer depository institutions and primary dealers two complimentary alternatives for meeting funding needs.
One pair of facility is the discount window for depository institutions and the primary dealer facility for primary dealers, offers daily access to variable amounts of funding at the initiative of the borrowing institution. A second pair of facilities, the term auction facility for depository institutions and tern securities lending facility for primary dealers makes available predetermined aggregate amounts of longer term funding on pre-announced dates with the interest rate and the distribution of the awards across institutions being determined by competitive auction.
Although these facilities operate through depository institutions and primary dealers, they are designed to support the broad financial markets and the economy by facilitating supervision of liquidity by those institutions to their customers and counterparties. The primary dealer credit facility was put in place in the wake of the near failure of Bear Stearns, a large investment bank.
On March 13, Bear Stearns advised the Federal Reserve and other government agencies via the Securities and Exchange Commission that its liquidity position had significantly deteriorated and it would have to file for chapter 11 bankruptcy the next day, unless alternative sources of funds became available.
This news raised difficult questions of public policy. Normally, the market source out which company survives and which fail and that is as it should be. However, the issues raised here extends well beyond the fate of one company. Our financial systems extremely complex and interconnected and Bear Stearns participated in extensively in a range of critical markets.
With financial conditions fragile, the sudden failure of Bear Stearns likely would have led to a chaotic unwinding of positions in those markets and could have severely shaken confidence. The company's failure could also have cast doubt on the financial positions of some of Bear Stearns' thousands of counterparties and perhaps of companies with similar businesses.
Given the current exceptional pressures on the global economy and financial system the damage caused by default by Bear Stearns could have been severe and extremely difficult to contain. Moreover, the adverse effects would not have been confined to the financial system but would have been felt broadly in the real economy through its effects on asset values and credit availability.
To prevent a disorderly failure of Bear Stearns and the unpredictable but likely severe consequences of such a failure for market functioning and the broader economy, the Federal Reserve in close consultation with the Treasury Department, agreed to provide funding to Bear Stearns through JPMorgan Chase.
Over the following weekend, JPMorgan Chase agreed to purchase Bear Stearns and assumed their financial obligations. The Federal Reserve has taken additional measures to improve market liquidity. We have initiated a series of 28 days single trench term re-purchase transactions with primary dealers expected to accumulate $100 billion outstanding in which dealers may offer any of the types of collateral that are eligible for conventional open market operations.
We have also expanded and extended reciprocal currency arrangements or swap lines with the European Central and the Suisse National Bank. Using these swap lines, the participating central banks are providing dollar liquidity to financial institutions and their jurisdictions which should improve the functioning of the global market for dollar funding.
These facilities and programs will be kept in place as long as conditions warrant their ongoing use. We are working closely with the Securities and Exchange Commission to monitor the financial conditions and funding positions of primary dealers who might seek Federal Reserve credit.
To date, the recent liquidity measures implemented by the Federal Reserve seem to have been helpful in addressing some of the strains of the financial markets. Funding pressures on primary dealers appear to have eased somewhat and liquidity seems to have improved in several markets including as noted earlier, the market for agency mortgage backed securities. To the extent that these measures improve market functioning they will have favorable effects on the ability and willingness to make credit available to the broader economy.
More liquid markets also increase the efficacy of monetary policy which in turn improves our ability to meet the goals set for us by the Congress. Namely, to promote maximum employment and price stability. As you know, in response to the weakening of economic conditions the Federal Reserve has continued to ease the monetary policy.
The FOMC reduced this target for the federal funds rate by a total of 125 basis points in January and by an additional 75 basis points at its March meeting. Leaving the current target at 2.25 percent. Three percentage points below its level last summer.
As the committee noted in its most recent post-meeting statement, we anticipate that these actions together with the steps we have taken to foster market liquidity will help to promote growth over time and to mitigate the risks to economic activity. Clearly the U.S. economy is going through a very difficult period.
But among the great strengths of our economy is its ability to adapt and to respond to the diverse challenges. Much necessary economic and financial adjustments has already taken place. And monetary and fiscal policies are entrained that should support a return to growth in the second half of this year and next year. I remain confident in our economy's long-term prospects.
Thank you and I would be pleased to take your questions.
REP. CHUCK SCHUMER (D), NEW YORK: Well, thank you, Mr. Chairman. And just notify my colleagues because we didn't have time for opening statements and everyone has so much to ask, we are going to do seven- minute rounds for everybody. Mr. Chairman, on page four of your testimony, you say that the economy could "even contracts" --
FREDRICKA WHITFIELD, CNN ANCHOR: You are listening right there to the chairman right there. Congressman Chuck Schumer there of New York, the chairman of the joint economic committee there on Capitol Hill. As they get poised to ask their questions to the Fed chairman, Ben Bernanke. Certainly not painting a very rosy picture, admitting right there that clearly America's economy is "in a difficult period."
He has been underscoring the difficulty for banks and lending institutions to extend new credit. Sales of homes continue to be weak and he says that it was the Fed's obligation to help Bear Stearns. Just some of what he was saying in his opening remarks there on the nation's economy as he and his team sees it. You can continue to watch the questioning, the back and forth of the Fed chairman Ben Bernanke there on Capitol Hill at CNN.com.
Meantime, let's bring in our Allan Chernoff there is New York, also watching what is being said there in Washington.
I don't know how hopeful people were that they might hear from Bernanke that there is light at the end of the tunnel. But he was brutally honest, we think, right? That the economy is not good right now and it is going to be tenuous for some time still coming.
ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: Well, some people could argue that he actually is pointing to light at the end of the tunnel.
CHERNOFF: It's in his testimony, he did say the economy is going to continue to contract during the first half of the year but he is sticking by the Fed's prior prediction that we will begin to see a recovery in the second half of this year. There had been some speculation that perhaps he would say hey, you know the economy is not going to be picking up until next year but he is still sticking by that. Although he also did say that there's great uncertainty in that forecast and the risks are to the down side.
Fredricka now --
(BEGIN VIDEO CLIP)
BERNANKE: The issues raised here extend well beyond the fate of one company. Our financial systems extremely complex and interconnected and Bear Stearns participated extensively in a range of critical markets. With financial conditions fragile the sudden failure of Bear Stearns likely would have led to a chaotic unwinding of positions in those markets and could have severely shaken confidence.
(END VIDEO CLIP)
CHERNOFF: Now, what we just heard there from the chairman was this his statement that Bear Stearns, the collapse of Bear Stearns if it had happened really could have hurt the economy dramatically and that is what we are going to hear. So many questions about in the next hour or two on Capitol Hill after this hearing.
The chairman is going to come under a lot of questioning and even Senator Schumer, the chairman of this committee, said in his opening statement, what's the justice of helping Bear Stearns and not helping homeowners, not helping millions of homeowners.
What Bernanke was saying just there in that sound bite is that if he had not helped Bear Stearns, if the Federal Reserve had not come to the essential rescue of Bear Stearns, putting $30 billion of our own taxpayer money on the line in this deal he really feared that the financial markets, the economy could suffer a dramatic collapse.
He does not want to be too explicit in using the terminology because he doesn't want to scare people. But the fact is Bernanke is one of our nation's experts in the Great Depression, he saw the possibility that Bear Stearns collapse could actually lead to something like that and that's why the Fed has been so very, very aggressive here.
So, he is going to be walking a little bit of a tightrope in the hearing and in the Q&A session right now. Saying hey, I feel we had to go in there and help but he does not want to scare anybody.
WHITFIELD: Well, you have to wonder why he doesn't want to scare anybody, people are already scared. I don't know how much more frightened folks can really get at this point because we're talking about the foreclosure rate the way it is, lending institutions are saying it is going to be tight, tough to unleash more money. And if Bear Stearns could face near collapse, people are still wondering what other banks just like it are next.
CHERNOFF: Right. Well, Fredricka a few weeks ago we certainly did have some of that panic in the market. And it has eased dramatically. Look at that huge jump we had in the stock market only yesterday. But it certainly could have gotten much, much worse. And that's why the Federal Reserve will be talking about the reasons that it had to step in and it had to -- believes it had to step in and help out Bear Stearns there.
WHITFIELD: All right. Allan Chernoff, thanks so much.
And of course, as a reminder, if you want to continue to hear the remarks from Ben Bernanke, right there CNN.com. You can watch that live in stream video as he now testifies before Capitol Hill.
TONY HARRIS, CNN ANCHOR: The nation's economy, a new measure out just minutes ago. Government figure showing factory orders fell 1.3 percent in February. Now, that's disappointing. Analysts expected about half that. Another surprise this morning, this one a little more encouraging.
A report showing that businesses added jobs in March. Analyst has expected a decline. Caution is the watch word on Wall Street today. U.S. markets largely flat? A little negative right now.
The Dow down 41 points. OK. All right. We are down just 35 points. That comes after yesterday's nearly 400-point surge in the slumping economy affecting you in ways, clearly more ways than you know. Check out CNNMoney.com special report, "ISSUE #1," America's money.
There is a ton of information there that could save you money and misery plus interactive tools and a lot more. That's at CNNMoney.com.
WHITFIELD: Bomb parts. Stopped at the airline ticket counter.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: He was acting all weird. He was shaking left to right. Up and down. He looked like a crazy man basically.
(END VIDEO CLIP)
WHITFIELD: Very suspicious behavior. So this passenger grounded. Now headed to court in the NEWSROOM.
WHITFIELD: If you are taking to the skies today and if you are flying United Airlines you may be in for a long wait. The airline pulling all its Boeing 777s out of service for safety checks. United says the plane's cargo fire suppression systems are being examined and that could mean delays or cancellations, this comes two days after United announced wiring system problems aboard some planes. Last week, Delta and American cancelled hundreds of flights for inspections.
And three weeks ago, CNN broke the story about problems with Southwest Airlines' Boeing 737s. And we will continue to follow the developments at United throughout the morning -- Tony. HARRIS: Security watch in Orlando, Florida, this morning, scary stuff. Allegedly found in an airport suitcase. Did the owner plan to make a bomb? CNN's Susan Candiotti is tracking details from Miami.
Susan, great to see you. We are getting some indication this man is due in court maybe this hour.
SUSAN CANDIOTTI, CNN, CORRESPONDENT: That's right. At the bottom of the hour he will be making his first appearance before a federal magistrate in Orlando. You know, Tony, the FBI says that this man was living on the streets lately. Yet, he was booked on a flight to Jamaica, had checked in his luggage and apparently he had bomb components in those checked bags. The man has been identified as Kevin Brown, 32-years-old.
Authorities say he showed up at the ticket counter, again checked his luggage. But he was acting strangely. Some witnesses say he was shaking literally. And he was pulled aside, they looked into his luggage.
And what did they find? Well, quite a lot -- two galvanized pipes, end caps, BBs, batteries, two containers with some unidentified liquid, bomb literature, and a laptop. About a dozen flights were affected while all this was sorted out.
(BEGIN VIDEO CLIP)
LEE KAIR, TSA, FEDERAL SECURITY DIRECTOR: I can't say there was no immediate threat to anyone in the terminal. There was no imminent threat to any person or any of the incoming public.
(END VIDEO CLIP)
CANDIOTTI: So now Brown is charged with carrying explosives on a plane. Remember, these were in checked luggage. So, it is not as though any of these components were put together and he had access to them. There is no carry on involved. So he is appearing in at the bottom of the hour now.
We have someone, a CNN producer in that courtroom. And he will be reporting to us as soon as he finds out more and we will pass it on to you. This man is a Jamaican national. He was living in the United States with a valid green card -- Tony.
HARRIS: And Susan, I know that some of these airports are using behavioral teams to help them identify passengers who may be acting bit suspiciously. I'm not sure. Does that airport there use a behavioral team?
CANDIOTTI: It does indeed. In fact, the TSA is crediting that team with plucking this guy out. He had a - they did say of course that he was acting oddly. That was what was strange about it. But they are trained to look for that.
And not only that but there are other airports around the country, Tony, that train their own employees such as Miami International Airport. And that means everybody, including janitors, to look for people who are not acting as though they should and to report them.
HARRIS: Very good. All right. Susan Candiotti for us this morning. Susan, thanks.
WHITFIELD: All right. Another big concern everybody is facing. The cost of gas. There are a few tricks to find the best places around in shopping for the best gas prices. And you don't have to burn a drop of gas in order to find them.
HARRIS: What do you say we get you to the New York Stock Exchange right now for a look at numbers. Wondering if the comments from the Fed chair might have some impact on the markets today. I suspect they might. But who knows how it might go.
WHITFIELD: Because the numbers have been down and up. Down and up.
HARRIS: Yes. So here we go.
WHITFIELD: Prior to his speaking and here we are.
HARRIS: We are about an hour into the trading day. And the Dow is down 20. Nasdaq, let me get the latest here. Nasdaq is pretty much flat for the day. We are checking the numbers with Susan Lisovicz in just a couple of minutes right here in the CNN NEWSROOM.
WHITFIELD: All right. Oil executives under the congressional spotlight. But no relief in sight for you at the pump. No fair. Gerri Willis is here to help us find the cheapest gas around.
Boy, this is a tough job, isn't? Trying to find the cheap gas.
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Well, you know, first of all, I have to bring the prices to you. There are companies out there that will send you a text message when you are on the road.
WILLIS: The lowest gas prices right to your cell phone. You go to gasmob.com, you can sign up for free text messaging alerts to tell you know when lower gas prices are available. Gasbuddy.com has a similar service. Now, to get these messaging updates, you send an e- mail to email@example.com.
The text message will be sent to you with the five lowest gas or diesel prices in the area you request. You know, keep in mind that while you don't pay for the service if you have a text messaging plan on your cell phone, cellular fees will apply.
WHITFIELD: So what about that help before you actually hit the road? Before you lose your, leave your driveway, how you find out, you know, the best prices out there? WILLIS: Well, there are Internet sites to help. Check out gasprices.mapquest.com. Just plug in your zip code and you will get information on the cheapest gas stations along with addresses, directions, phone numbers.
And hey, if you are going on a trip, you can get an estimate of what your gas bill will be like on the site's gas price calculator. You can get also information on cheap gas prices in your area from gaspricewatch.com. You know, Fred, doing your homework, it really pays off. Because the difference between the most expensive gas station and the cheapest one, 30 to 40 cents.
WHITFIELD: Oh, my god. That's huge. That really adds up. Yes. So, in general, then, who has the cheapest gas?
WILLIS: All right. So if you are looking for the cheapest gas. You go to the big warehouse stores or discount retailers like Costco, Wal-mart.
WHITFIELD: Is it good gas?
WILLIS: I'm more concerned about the cheap gas. I have to tell you.
HARRIS: Is it good gas?
WHITFIELD: Diluted? You know.
WILLIS: Well, you know, I think you're going for price here. These retailers sometimes have gas pumps with the lowest gas prices. So, that people are enticed to spend more inside the store. Of course, keep in mind that in a warehouse you usually have to pay for membership. That's not cheap, let alone can eat up your savings.
If you don't want to buy a membership, check out gas stations around those wholesalers or discount retailers. So, if you are worried about the gas being not good, go somewhere you really like.
WHITFIELD: Sorry, I'm skeptical about everything. I know it's terrible. So speaking of memberships, let's talk about gas cards. Rebate cards.
WILLIS: Rebate cards. You know, I think this is a good idea. They can lower the cost of gas with rebates on your gas purchases. Hey, you want to look for a card that has five percent cash back on your purchases with no restrictions or caps that is.
Blue Cash from American Express is a good example of this. But keep in mind you have to spend $6,500 in order to get the rebate. Some gas rebate cards like Chase's Perfect Card have teaser rates that can be six percent back on gas purchases but you really have to read the fine print here.
Make sure you know when the teaser rate ends, keep in mind gas rebate card is good only at stand alone gas stations since you may not be able to collect the rebate if you go to a station that is affiliated with a Costco or Wal-Mart like we were talking before. You can compare the rates and terms of these gas rebate cards. Great place to go -- cardratings.com.
And of course, if have you any questions, send them to us at firstname.lastname@example.org. We love hearing from you.
WHITFIELD: Wow. So much, so much information. Rebates. I would love that.
WILLIS: Yes, I think it's a good idea.
WHITFIELD: All right. Thanks so much, Gerri. If you think it is a good idea then it is a good idea. I'm sold.
WILLIS: My pleasure. See you guys tomorrow.
HARRIS: "Home Rich." Come on.
WHITFIELD: Yes, that's right.
HARRIS: If elected what the candidates are saying about autism. Their plans on dealing with the disability.
WHITFIELD: All right, welcome back to the NEWSROOM. I'm Fredricka Whitfield.
HARRIS: I'm Tony Harris. Good morning, everyone.
I just went to CNNMoney.com just to figure out what Ben Bernanke, the Fed chair, is saying this morning.
WHITFIELD: There is a lot to decipher.
HARRIS: Absolutely. OK, so we are monitoring the congressional testimony of the Fed chairman, Ben Bernanke. He's testifying before the Joint Economic Committee and taking questions now, as you can see from the members.
Went over to CNNMoney.com to see what the take is from our friends there at dot-com. And Bernanke just said the Fed -- oh, I'm sorry, that's the wrong page here. The Fed chairman says the economy may now shrink in the first half of the year, the closest he has come to proclaiming a recession.
And throughout the morning, as you mentioned, Fred, he will be defending the Bear Stearns bailout. That's what they're calling it, a bailout. We will check in to find out how the Fed chief is doing with Susan Lisovicz in just a couple of minutes right here in the NEWSROOM.
WHITFIELD: All right, here is something positive, at least for Obama, right, an endorsement. And then Clinton talks jobs. And McCain recalls his Navy days. A lot happening on the campaign trail. Barack Obama speaking to union members in Philadelphia.
This morning, Obama also picks up an endorsement from former Indiana Congressman Lee Hamilton. It could boost his national security standing. Hamilton was vice chairman of the 9/11 Commission and co-chair of the Iraq Study Group.
And Hillary Clinton announces a $7 billion jobs program this morning. She outlines the plan at an economic summit in Pittsburgh next hour.
And Annapolis, Maryland, the latest stop on the John McCain biography tour. The Republican nominee to be speaking this morning at the U.S. Naval Academy, where his military career began.
HARRIS: What do you say -- to get back to Allan Chernoff, who is monitoring the testimony from Fed Chairman Ben Bernanke.
And something interesting that you just sent us just a moment ago, Allan.
CHERNOFF: Absolutely. Bernanke has been making some very important points. First of all, just a minute ago, he talked about the blueprint for financial regulation that Henry Paulson, the Treasury secretary, announced just the other day. And he said, you know if you're going to give the Federal Reserve responsibility for stability in the financial markets, which is what the blueprint would do, he said, don't take away any of our power.
We still need to have power over the banks, over the banking system. The blueprint appeared to maybe say that the Fed would be a super cop, but it wouldn't necessarily have all of the powers it has now.
So that's his light criticism. He said it was good starting point, and he also said, we're going to have plenty of discussion before the plan goes anywhere.
HARRIS: Yes. Even Treasury Secretary Paulson said it's going to take some time, years, in fact. Hey, I'm wondering, are you hearing any comments from the Fed chairman about what's being called -- well, it is what it is, the bailout of Bear Stearns? I can't imagine he won't face -- he'll face a number of questions on that topic.
CHERNOFF: Tony, he has been, and he doesn't like that word. He said this was not a bailout. He said that this was important for the viability -- and I'm quoting here -- "The viability of the American financial system, and he said that this really affected anyone who wanted to buy a house, buy stocks."
He said what we did was the best thing for the American public. What the Fed chairman is trying to do here is say, hey, you know, we were not in the business of trying to rescue one Wall Street firm, one big business of fat cats, people who are making millions of dollars. He's saying, hey, this was for everybody's benefit.
HARRIS: But, Allan, you don't have an account at Bear Stearns. I don't have an account at Bear Stearns. Anyway, that will take us into a whole other area. But go ahead, go ahead.
CHERNOFF: All right, let me just finish up. Not to defend the Fed chairman, but just to point out the fed really was trying to prevent Bear Stearns from basically being a domino that would have hit all of the other financial firms and eventually, Tony, it might have gotten to the firm where maybe you have a little bit of money stashed, and clearly he believes, the Fed chairman believes, it could have really caused a major crisis in the financial markets and hurt the economy big time.
HARRIS: I have that much in my account. All right, Allan, appreciate it. Thank you.
WHITFIELD: In the meantime, we are following this all day today. Autism, this is issue No. 1 for so many families. On this first-ever World Autism Awareness Day, we look ahead to a day in January. What will the new president do about the disability?
Here's our Dr. Sanjay Gupta.
DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: John McCain caused quite a stir when he linked autism to the childhood vaccines.
SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: There are strong evidence that indicates it has got to do with a preservative in vaccines.
GUPTA: That's a widely held view, but mainstream scientists say it's wrong. Mainly because the preservatives Senator McCain referred to is no longer used in vaccines, and the autism rate is still going up. A few days later, McCain backed off.
MCCAIN: And we don't know what's causing the increase in autism.
GUPTA: But, the episode showed that autism can be an election issue.
OBAMA: It is reaching epidemic proportions.
GUPTA: All the candidates say they would fund more research into what might be making children sick. But Democrats say they would make sure insurance companies cover therapy for children with autism by not allowing it to be a classified as a pre-existing condition.
SEN. HILLARY CLINTON (D-NY), PRESIDENTIAL CANDIDATE: Something is causing this.
GUPTA: Senator Clinton also promises to create a special task force to identify which treatments work best. And said she wants to provide care to families faster once a child has been diagnosed.
CLINTON: We've got to have services available so families can know there is some help there.
GUPTA: Like Clinton, Senator Obama says he'll give more money to schools for screening to make sure children with autism are diagnosed early, and to improve special education classes.
OBAMA: And what I've said is we are going to start fully funding special education.
GUPTA: In fact, when it comes to education for children with autism, the candidates basically agree.
MCCAIN: I will do everything in my power to try to help find the cause and to help with the education, so that these young people can lead useful lives and contribute to our society.
GUPTA: McCain says he would promote early screening and research to find effective treatments for autism. Of course, without a known cause or a cure, autism will be a daunting challenge for the next four years and beyond.
Dr. Sanjay Gupta, CNN, reporting.
WHITFIELD: And coming up, this woman speaks for her grandson and others with autism. The co-founder of Autism Speaks has a message for you.
WHITFIELD: A mother who can afford autism costs, but worries about other family.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: I consider us the lucky ones, because we have good education and good jobs, and so we can sacrifice that much money for his therapy. The people that just break my heart are the ones that can't.
(END VIDEO CLIP)
WHITFIELD: So how this mom won a battle over insurers, but won't benefit.
WHITFIELD: Security watch in Orlando, Florida. An airport bag allegedly filled with bomb making components. The owner in court just moments ago.
Let's get to CNN's Susan Candiotti in Miami -- what happened?
CANDIOTTI: Well, as it turns out, we're not learning that much more about this man or about what happened. His name, Kevin Brown, he is the suspect who is charged with carrying explosives onboard a plane, inside checked luggage, allegedly component parts.
But what happened at this brief hearing before a judge is that the government asked for more time to prepare for this preliminary hearing and first appearance, and also asked for more time for a bond hearing. Those will take place tomorrow, as it turns out.
And so until then, this man will be kept without bond. He was brought into court without handcuffs, but his legs were shackled. And so until we learn more information about him, we will have to wait before we get more information from that preliminary hearing and pretrial detention hearing as well.
So again, to recap, this man was arrested yesterday at Orlando International Airport the authorities found allegedly bomb components, enough for a pipe bomb, in his checked luggage. A behavior technique was used to spot him in the crowd, and that's when he was arrested.
WHITFIELD: All right, interesting stuff. Thanks so much, Susan Candiotti in Miami.
HARRIS: When her grandson was diagnosed with autism, her world changed. Since then, Suzanne Wright has helped other families going through the same heartbreaking changes. The co-founder of Autism Speaks playing a prominent role in today's World Autism Awareness Day.
Suzanne, great to see you. Thanks for your time this morning.
SUZANNE WRIGHT, CO-FOUNDER, AUTISM SPEAKS: Thank you so much. And thanks, CNN, for all that they're doing for us.
HARRIS: How about this, huh?
WRIGHT: It's amazing.
HARRIS: Well, it's our pleasure. I mean, it's an amazing amount of information we are all learning. You have been down this road and gathering information. How long ago was your grandson diagnosed with autism?
WRIGHT: He was diagnosed about three years ago, three-and-a-half years ago.
HARRIS: So three-and-a-half years ago. I'm curious, at that time, how much information was available to you when you went in search of it?
WRIGHT: Well, it was astounding. Because as you know, my husband was chairman of NBC at the time. And I walked out of the diagnosis -- it was the worst day of my life -- with my daughter. And I turned to Bob, and I said, I cannot believe what they just told me.
At that time it was one in 166. And I said, you mean to tell me that it's one in 166 and no one seems to be -- have a medical emergency here and no one was talking about it. So NBC started the week with "The Hidden Epidemic," and were off and running. We announced on February 25 of 2005 that we'd be starting Autism Speaks.
HARRIS: Great. Now tell us about the mission of Autism Speaks.
WRIGHT: Well, it's the awareness issue. Nobody knew about how serious this epidemic was. I was astounded that no one was talking about this, and it wasn't in the national vocabulary. I mean, autism affects every community, affects ever country, and it affects every continent, and that's when why we went to the United Nations with the state of Qatar. Her highness had asked me come over.
Because as you see, our ad council campaign has been extremely successful here in the United States. We're coming up on dollars 97 million in donated media. And in they're history, they're 65-year history, they have never taken on a single disease campaign. We're it.
HARRIS: Now, Suzanne, it's more than just raising the awareness. That's a major component of this. But you want to also find the cause, find a cure. That takes a lot of money. How is that effort going?
WRIGHT: That effort is going tremendously. We are coming up on $100 million after three years. We have a long way to go. But we have the right partners in Qatar. We just signed a collaboration agreement with them, that we're going to search for the cause and cure.
They have a wonderful genetics laboratory that they're building, they have a fantastic school. And with the U.N. awareness, the global awareness, we need global collaboration, we need this entire globe to come in and find the cure because this is a global epidemic.
HARRIS: Parents have to spend so much of their own money, we are learning over the last few days here, in treating their children. I'm wondering, is there a role for health insurers? And I know the answer is yes, but how do we get there?
WRIGHT: Well, we're going to get there. Autism Speaks is on the run here, getting after the insurance companies. I mean, I was amazed that in a lot of insurance policies they actually write in, "We do not cover autism." We know several families, many, many families that have no -- they have insurance, but the insurance doesn't cover autism. It's amazing, because the insurance covers diabetes in a child, or leukemia in a child, but the discrimination's across the board.
It's education. It's health issues. It's insurance. This autism community, when I became a part of it, I'd never seen such a desperate community that needed so much help, and nobody was paying attention.
HARRIS: How is your grandson?
WRIGHT: He's doing fine. He's the hardest worker in our family. He works so hard. He has about 50 hours a week of therapy. It's extraordinary. HARRIS: Where is the real promise here in the research? Are we talking about genetic research, brain imaging? Where is it?
WRIGHT: We're talking about it all. We're talking about it all, everything across the board. As you say, it's a mystery. No one knows why one child responds to a certain therapy and another child doesn't.
We have so much work to do. But the awareness is a cornerstone of our mission. Once we get the awareness out there and everybody starts talking about it, we're going to get a lot of results.
HARRIS: What a spokesperson you are.
WRIGHT: Thank you.
HARRIS: Suzanne Wright, it's great to see you. And thanks for your time this morning.
WRIGHT: Thank you. Autism Speaks and finally the world is listening.
HARRIS: Great to have you on the program.
WRIGHT: Nice to be here.
HARRIS: Thank you so much.
WRIGHT: You're welcome.
HARRIS: And again, we want you to stay with us all day for our coverage of autism, including at noon Eastern a one-hour special, "We have Autism," focusing on families living with autism around the world. And stay up for "Finding Amanda," a one-hour "Anderson Cooper 360" special at 11:00 p.m. Eastern Time. It's about a woman with autism you won't forget.
Also, follow our coverage at CNN.com, where you can see how you can help, watch I-Reports and read blogs from families dealing with autism. It will really touch your heart.
WHITFIELD: It's extraordinary stuff.
Well, mission damage control, the nation's top banker on the economy and what's being done to keep it from getting any worse.
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