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Issue Number One

Credit Crunch Remains Tight; Americans Spend Stimulus Money on Gas; Senate Takes up Climate Bill

Aired June 02, 2008 - 12:00   ET

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


GERRI WILLIS, CNN ANCHOR: Thank you, Heidi.
Hello everyone, this is "ISSUE #1." Ali is off today.

(INAUDIBLE) the anger that you feel at pump hasn't eased today, but it shouldn't be any worse either. AAA says yesterday's record price of $3.97 a gallon for regular unleaded hasn't budged one iota today. As for oil, there's mixed news. In early morning trading, prices were below $127 a barrel but later rose to $127.56 and alternated between gains and losses.

Now while gas prices remain at record levels, the mortgage meltdown has yet to cool off. The credit crunch remains tight. On top of that, there are indications more and more Americans are spending their stimulus checks on debt and gas and not in retail stores. All things economy obviously on the mind of President Bush today. CNN's Elaine Quijano is live right now at the White House.

Hi there, Elaine.

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: Hello to you, Gerri.

Well, against that backdrop that you just laid out, President Bush is once again calling on Congress to make his tax cuts permanent. Today, the president marked the five-year anniversary of his signing of tax relief legislation by inviting a number of economists to sit down and discuss the benefits of tax cuts. The president, as he's done time and time again, acknowledged once more that the economy's in a slow period right now, but the president argued that the current conditions are all the more reason to extent those tax cuts.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: (INAUDIBLE) talk to Congress about the economic slowdown and we understand there's an economic slowdown; we're concerned about the economic slowdown. And one of the things that they can do to help make sure that this economy is recovers, like we believe it will, is --

(END VIDEO CLIP)

QUIJANO: Now Democrats, meantime have argued over and over that it is the president's economic policies, they say that have failed the American people and led to this economic downturn in the first place. They say that the policies laid out by the president do not do enough to help middle class families, Gerri, who are struggling right now to make ends meet -- Gerri.

WILLIS: Elaine, thank you for that.

The economy is likely to be issue number one for the next president of the United States. But the election race still has a long way to go. CNN senior political analyst Bill Schneider, part of the best political team in television, joins us now.

All right, Bill, with just two Democratic primaries left, how is the race playing out right now between Clinton and Obama?

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Well, you're getting some squabbling over who's ahead here. Clinton claims that she's ahead in popular votes. Obama says that - he disputes that. It depends on how you count those uncommitted voters in Michigan, do you count them for Obama or not? That's at issue but also a question, does it mean it anything? The popular votes don't determine the winner, the delegate counts do. And the delegate count shows that Obama is ahead of Clinton by 155 delegates.

He needs 48 more to gain the majority and win the nomination. She needs 203 more so they are going to convince super delegates to come over and that's going to be very tough for Hillary Clinton to get that many super delegates. There just aren't enough left.

WILLIS: How's the economy going to play? Who gets the benefit of the economy being as week as it is?

SCHNEIDER: The economy is weak. Gas is $4 a gallon. I can't imagine that doesn't hurt the incumbent party and that will of course be the Republican Party. In every election I've ever experienced and that's quite a few it hurts the incumbent party. But there's one little twist in this election. In 1992, remember the economy, stupid? President Bush was running for re-election, the first President Bush.

Now this President Bush is not running for reelection. His vice president is not running to succeed him and the interesting thing is that John McCain is doing not too badly, about three points behind in national polls. A lot of people don't necessarily connect him to the Bush administration. The Democratic campaign, if it ever gets started, has got to make the point clearly to Americans, John McCain is a continuation of the Bush administration. It's a third term for George Bush but a lot of people don't see that.

WILLIS: Fascinating, Bill Schneider, thank you so much.

We're going to talk in just a few minutes about a major environmental bill in the Senate right now and that's the inspiration for today's Quick Vote question. That means it's time to check in with Poppy Harlow from CNNMoney.com.

Hi there Poppy.

POPPY HARLOW, CNNMONEY.COM: Hi there Gerri.

Well, today we're focusing on this bill that you'll hear about in just a minute at the CNN energy desk. But we really want to know what do you think? So here's our quick vote question today, who should be responsible for cleaning up the environment? Government, industry, we as individuals or all of the above? You can weigh in on CNNMoney.com. We'll bring you the results a little later in the show -- Gerri.

WILLIS: Poppy, thanks for that, so much blame to go around.

We'll have much more on the historic Warner-Lieberman environmental bill next including if it's even feasible.

Plus a big hurricane season is in the forecast. What that could do for already-record high gas prices.

If you have any questions relating to your own economy, send us an e-mail, issue1@cnn.com. The CNN money team answers your questions every single day at the help desk. You're watching "ISSUE #1."

(COMMERCIAL BREAK)

WILLIS: The Senate today takes up what could be, could be a historic climate bill. Its main concept, capping the amount of pollutions companies can put out.

CNN's Kate Bolduan joins us now from Capitol Hill -- Kate.

KATE BOLDUAN, CNN CORRESPONDENT: Hi there, Gerri.

You said it. It's a massive bill targeted towards combating pollution by placing caps or limits on the amount of greenhouse gases that certain U.S. facilities can give off. Now, here's how it works. Basically it's designed, the bill is designed to reduce pollution in about 2100 U.S. facilities by 2 percent each year.

These are facilities from cement plants, steel plants, to power plants that burn coal equaling a total U.S. reduction in greenhouse gas emissions of about 66 percent by mid century. Now, today, we are expected, the Senate, to vote to begin the debate and that of course, is expected to pass.

The state of the final bill, the overall bill, is a little less certain. Critics, mainly Republicans are expected to block final passage of this bill. But despite that reality, supporters are pushing forward and pushing forward with force. Senator -- Democratic Senator Barbara Boxer, a key sponsor of this bill, explains why.

(BEGIN VIDEO CLIP)

SEN. BARBARA BOXER (D) C.A.: I am very optimistic that all three candidates who are still standing at this stage, Obama, Clinton, and McCain, are very interested in proposing global warming legislation, in signing global warming legislation, so it's just a matter of time. We need to get started and take it as far as we can. Will we take it, you know, a tenth of the way, a half of the way?

I can't answer that. But that's what, you know, legislating is about, you can't predict these things. You just have to have the courage to get started.

(END VIDEO CLIP)

BOLDUAN: Now, global warming and climate change will, of course, be the focus of the debate today and as it continues for several days, we hear at least. Critics of the bill will be out arguing that the economic, the cost of this bill, much outweigh the benefits of this bill. They say that really that this bill would spike energy costs and damage, they even say, devastate, the economy and that burden will then, of course, fall on the U.S. consumer by means of higher gas prices, higher electricity costs and even job loss. But supporters of the bill, Gerri, they maintain that this is deficit neutral and that the benefits outweigh the costs, of course.

WILLIS: Interesting stuff. I'm curious, though, is the White House promising to veto this bill? They have come out and talked about a lot of initiatives lately. What are they saying on this?

BOLDUAN: No veto threat has been issued by the White House, but we do know that the administration is going to be issuing a statement pretty much just laying out the views, their position, on this bill later today. And the president has said in the past, as you mentioned, Gerri, that he does not support the bill because they don't support mandating emissions reductions.

WILLIS: OK. Thank you for that.

Eamon Javers is the financial correspondent for politico and he's been keeping a close eye on the development of Lieberman-Warner. Welcome to you. You know, there are a lot of scary numbers out. Kate was just mentioning some of this about how gas prices could go up 40, 50 cents a gallon just on the basis of this.

Can you make some sense of this? Are there any real, hard facts about financially what this is going to mean?

EAMON JAVERS, FINANCIAL CORRESPONDENT, POLITICO: This is a congressional debate. There are never any real, hard facts. But look, opponents of this legislation have been putting out numbers saying that the average consumer is going to see a hit to their wallet of something like $700 a year or even into the $3,000 a year range in the next several years if the bill works as passed. Those of course are numbers that are put out by the opponents to try to derail the legislation. So you always have to take that with a little bit of a grain of salt.

But that's what they're talking about as if your wallet could see a hit of a couple thousand dollars a year if this bill passes. The trick here is that this is kind of a congressional debate on training wheels or a test drive. They're not really going to pass this bill. Nobody really expects this thing to pass this year. What's happening is, they're teeing up the debate for 2009, when you'll have a new administration in the White House.

WILLIS: Right.

JAVERS: And potentially a new makeup of Congress. And that will mean to me a very different kind of a bill that might end up passing.

WILLIS: Well, you know, lots of hot air as usual coming from Washington.

JAVERS: No surprise.

WILLIS: Let's describe some of the details here that I think people are trying to embrace and understand.

JAVERS: Sure.

WILLIS: Let's talk about cap and trade. This is a big, important part of the bill. What is it? What will it mean?

JAVERS: The centerpiece of the bill is this cap and trade program and basically what that means is the bill would cap emissions that companies are allowed to make in greenhouse gases and then set up a trading system, so companies could basically buy and sell pollution credits on a market, sort of like a stock market for pollution credit. And basically, if you're a company and you hit the pollution credit number that you're allotted and you actually go beyond it, you could sell the surplus on the markets to other companies that are having trouble catching up with their emissions reduction and can't quite hit their number. So some companies could be selling excess credits into the market.

Other companies could be those buying credits off the market. The idea here is that this puts a price on pollution and really incentivizes companies to lower their pollution emittances (sic) in a dramatic way because otherwise they are real financial penalties for them.

WILLIS: Does this actually help the economy or does it just create one more big market that somebody out there can try to manipulate?

JAVERS: It definitely would create a huge market and there would be a lot of traders who would be interested in that. There's already something called the Chicago climate exchange where people are doing a voluntary trial basis of this and a lot of big companies are participating in that. But in terms of the overall economy, it depends on whether you believe global warming is damaging to the economy or not in the out years. If you do, then of course this is something that you have to do in order to take care of the economy in the out years. If you think global warming is a myth, then you won't be so happy with what's going on here with this bill.

WILLIS: Well, Eamon, thank you so much for your time, great information today.

JAVERS: Thanks a lot.

WILLIS: Up ahead -- how to figure out what your carbon footprint is and what you can do about it.

Plus, hurricane season is under way. What a major story could do to your gas prices. All those rewards programs out there, we'll tell you which ones actually work and which ones don't.

This is "ISSUE #1." Stay with us.

(COMMERCIAL BREAK)

WILLIS: Breaking news into CNN and bad news at that, CNN confirms Rock and Roll Hall of Famer Bo Diddley has died at the age of 79. Now this news coming from a spokesman who says the music legend was surrounded by family and friends at his home in Archer, Florida when he died. Much more coming up in the "NEWSROOM." Once again, Bo Diddley, considered one of the founding fathers of Rock and Roll, dead at the age of 79.

With the start of June, we have the official start of the 2008 hurricane season and few things can potentially send fuel prices soaring more than a hurricane. As for this season, the National Oceanic and Atmospheric Administration says, it's likely to be above normal with up to 16 named storms and up to five major hurricanes. The key advice here, you definitely want to be prepared.

If another hurricane like Katrina hits, $4 gas could be a fond memory. CNN's Sean Callebs looks at one vital part of our oil infrastructure, one that is incredibly vulnerable.

(BEGIN VIDEOTAPE)

SEAN CALLEBS, CNN CORRESPONDENT (voice-over): Port Fourchon is perhaps the most vital, yet vulnerable link in our nation's energy supply that you have never heard of, a bustling hub far down on Louisiana's coast that supports the offshore oil industry. Nearly 20 percent of all the oil used in the United States, one-fifth of our gasoline supply depends on this port being up and running.

TED FALGOUT, EXECUTIVE DIRECTOR, PORT FOURCHON: Whether it be the farmer in Idaho or the cattleman in Montana, they certainly require energy and this facility is key to a huge amount of this country's energy supply.

CALLEBS: In 2005, hurricanes Katrina and Rita hammered this port. Widespread flooding led to a massive shutdown and an instant spike in fuel prices. And so critically important to the economy that National Guard troops were summoned to protect the area.

DAVIE BREAUX, DIR. OF OPS, GREATER LAFOURCHE PORT COMM: The hardest thing clearing the debris off of the roadway because the road gets taken over by water and debris builds up on the roadway.

CALLEBS: Now that we're in hurricane season once again, it's time for the port authority to hold its breath. You think you're paying a lot for gas now --

FALGOUT: If this port is rendered inoperable, we'll see a huge inefficiency in our ability to bring in oil and gas.

CALLEBS: Another Katrina or Rita could instantly raise prices at the pump 10 to 15 percent, according to Fourchon officials. The weakest link along the coast, the 17-mile stretch of highway that cuts through marsh lands to the port. Twelve hundred trucks a day rumble through here, carting supplies to the 15,000 offshore workers in the Gulf. Are there nights that it keeps you awake worrying if this happens? Boy, people don't know how punishing it's going to be to the economy.

FALGOUT: I think what scares me the most is the ounce of prevention and the pound of cure thing.

CALLEBS: Fourchon is getting a new elevated highway but it won't be complete until 2011, but even that will only cover a portion of the 17-mile stretch. Port Fourchon is begging the Federal government to step in and help. Everyone here remembers what happened a couple of hours to the north.

FALGOUT: We professes that the levees in New Orleans and other areas need to be done and we did nothing until the catastrophe hit, and we paid 10 type times more to get it fixed. I see this happening here.

CALLEBS: And when you're below sea level, it's amazing how shallow the words "I told you so" can sound.

(END VIDEOTAPE)

CALLEBS: Back to September 2005, after Katrina and Rita, we had a big spike in oil prices. That's because Fourchon was shut down about 10 days. It was actually shut down for 50 to 80 percent of its operating capacity for a month. And Gerri, it actually took a year to get Fourchon back online once again after those hurricanes in 2005. So let's hope we don't see a repeat this year.

WILLIS: I hope you're right there Sean . Thanks so much.

Up next, credit card reward programs. It seems like every store has one these days. But some make sense while others are a waste of time. We're going to hash it all out for you and we'll help you figure out your own carbon footprint and tell you what you can do about it. You're watching "ISSUE #1."

(COMMERCIAL BREAK)

WILLIS: We're standing by right now for a town hall meeting in Troy, Michigan with Senator Barack Obama and we'll bring you that live as soon as it begins.

Well in the meantime, you get the pitch all the time. Sign up for a rewards card and get all sorts of perks. But which ones are the best ones out there? Amanda Walker, she's with "Consumer Reports" and she's got all the answers this morning. OK, 85 percent of us have these cards and you say they're a trap.

AMANDA WALKER, "CONSUMER REPORTS": Right. They're credit cards, credit cards come with lots of got ya's (ph) and they've got all the ones that credit cards usually come with -- interest rates that can go sky high, late fees, another layer with reward cards. If you are late they can hold your points hostage, for example, and not --

WILLIS: What does that mean?

WALKER: They can not let you cash them in or they can wipe them out.

WILLIS: That's bad news. I don't like that at all.

WALKER: Exactly. And it's hard to figure out what the points are all about, what does a point equal? Sometimes you've got to click for about 10 minutes before you actually find the details because a point for every dollar I spend sound likes a one for one trade-off, but you might have to earn 500 points and you only get $10 back. You really have to read through it.

WILLIS: I think people are used to looking at the small print and they know the devil's in the details with these cards.

WALKER: Good.

WILLIS: But you don't necessarily want to go through all of that. One interesting point that I think you make in this story, which I was sort of surprised about, you like some of the retail cards, right?

WALKER: Well, some of the retail cards are OK, if you shop there frequently, if you spend your money in that store. But you still have to be careful. Even when you use those cards because their interest rates tend to be very high, they can be 21, 26 percent. So if you carry a balance, they are not for you.

WILLIS: Let's get down to brass tacks here and talk about some of the cards you're actually recommending. Let's start with the gas card. You've got a lot of people out there are really struggling paying gas bill.

Where would you send them? What card should they get?

WALKER: The Shell card and Discover Open Roads give you a 5 percent -- these programs change all of the time, this was a couple of weeks ago -- when we looked they offered 5 percent back on gas, and 1 percent elsewhere. Not the problem is that they have limits. So there's a monthly limit or there's annual limit so you have to watch that as well. And it's only 1 percent reward spent elsewhere. So you might want to use a different rewards card for all you other shopping.

There's a Chase card that offers 6 percent back on gas, but it's a tease. That's another gotcha. It's a teaser rate, it's only good for three months. After that it goes to 3 percent.

WILLIS: Quickly, let's get to those supermarket cards that you think are the best.

WALKER: Yes, the Costco card gives you 3 percent back I think on some items spent in the store. Again, you have to read the fine print. Wal-Mart actually gives you some money back for gas. You get 3 cents back, but it's gas you purchase at Wal-Mart. It's like the Shell card. You can only use it there, at their station. If that's OK with you that could be a good thing.

The Kroger's deal, it's one of the largest chains in the nation. It's great if you stop at Kroger's. I mean, it's really only good for items spend at Kroger's. For the most part you get the biggest reward for what you spend there on their store brands. It's 3 percent back, 2 percent for everything else you buy in Kroger's, and then 1 percent for you other shopping that you do elsewhere.

WILLIS: Well, Amanda, great information. I just want to mention quickly, before we go, your best cash back rewards card, you like the AMEX Blue cash card, and Chase Freedom Visa card. Thank you for that, Amanda.

WALKER: OK, you're welcome.

WILLIS: Time now to get you caught up on the rest of the day's headlines in the "CNN NEWSROOM".

Don Lemon, take it away.

DON LEMON, CNN ANCHOR: Hello, Gerri Willis.

Here's what's happening right now. This is just in to CNN, Rock and Roll Hall of Famer Bo Diddley died today after months of poor health. A family spokeswoman said Diddley died of heart failure in his home in Archer, Florida. The legendary singer was known for his home made square guitar, dark glasses and black hat. "I Am A Man" among his first hits became a rock standard. Bo Diddley was 79-years-old. More details to come in the "CNN NEWSROOM."

Right now in North Carolina, Senator Ted Kennedy is having brain surgery at Duke University Medical Center. Doctors are trying to remove as much of a malignant tumor as possible. The operation's expected to take up to six hours. Once Kennedy recovers he faces chemotherapy and radiation.

What's it like to go through this surgery and this treatment? Ahead in the 2:00 p.m. Eastern hour of the "CNN NEWSROOM", we'll talk with Doctor Bernadine Healy, who as a patient herself went through the same procedure.

Wow, look at that, amazing video coming out of California. Universal Studios Theme Park is set to re-open in about an hour and a half after, a huge fire destroyed sets and videos. Check out this amazing new video of the blaze on Sunday. It took crews about 13 hours before they got the fire under control. Investigators haven't figured out yet what sparked that fire.

The man who helped America get through one of its worse natural disasters, remember General Russell Honore? He took the helm during Hurricane Katrina. Well his new mission is to get you to apply the lessons he learned from Hurricane Katrina. Find out what you need to know to be prepared for a hurricane or any -- any disaster. Straight ahead, that's in the "Newsroom at 1:00 p.m., at the top of the hour. I'm Don Lemon. Now, back to Gerri Willis -- Gerri.

WILLIS: We told you earlier about the Lieberman-Warner bill. It could make a huge impact on pollution in this country. But our next guest says it could also make a huge impact on low-income citizens, giving them new jobs. Van Jones is the founder of Green For All, and he's joining us now from San Francisco.

Van, great to see you. You know, what, let's just start out by talking about what you think of this bill.

VAN JONES, FOUNDER, GREEN FOR ALL: Well, you know, we like it. We have got to applaud Senators Lieberman and Warner, certainly have to applaud Senator Barbara Boxer, for trying to get us a bipartisan solution to probably the biggest challenge of the new century.

We like it, but we don't love it. We mainly don't love it because it just -- I think it underestimates the inventiveness, the innovation of the American people. All this bill does is tell 2100 companies that they need to cut their emissions by about 2 percent a year -- 2 percent a year? I mean, you know, some people are already saying, that's too much. We're saying that's way too little.

If we go farther, if we have higher standards we could unleash an economic renaissance with new technologies in solar, wind, and create more job. So, if you really want to move the economy forward, pivot to a green economy with more jobs, better health, less global warming. We should improve Warner-Lieberman by raising the standards, raising the targets.

WILLIS: So, Van, let's talk about that green economy. What do you mean by it? I know you're a social activist.

JONES: Yes.

WILLIS: And you think that, in fact, what's going on with the environment could benefit low-income people, how?

JONES: Sure, well, if you think about it, if we're going to beat global warming we have to weatherize millions of buildings, so they don't leak so much energy. That's millions of new jobs. We're going to have to solarize the country. We're going to have to put up solar panels all over the country; that's thousands of contracts, millions of new jobs. This is the work that most needs to be done so we can bring our energy use down, bring carbon down, beat global warming. But it also, it brings jobs up. If we can connect this work that most needs to be done to the people that most need work, we can fight pollution and poverty at the same time.

WILLIS: But, Van, isn't that like kind of a one-shot deal? I mean you upgrade the buildings and then the work's over and the project's done?

JONES: Well, no, if you think about it, we have literally millions and millions of buildings all across the country. It may take us 10, 15 years to really retrofit all of this building stock. We're also going to continue to innovate with new technologies. I tell you right now, in this economy, you tell somebody you'll only have a job for the next 10 so 15 years, they'll be pretty happy about that.

WILLIS: Yes, I hear what you're saying. Tell us a little bit about your project in Oakland. Because you really have taken some of the ideas that you have talked about here and put them to work there.

JONES: Sure. In the Bay area, you know, we're starting this thing called the Green Jobs Corps in Oakland. There's a project called Solar Richmond, in Richmond, California. What we're doing is taking disadvantaged young people and giving them tools and the training and the technology to get in on the ground floor of this green economy.

You know, to put up a solar panel, to be trained to do that, takes about nine weeks. But once you become a solar panel installer you're on the ground floor of an industry that's going somewhere. Couple of years later you could be a manager, could be an owner yourself. What we're saying is we have all of these young people who need an economic break, this could be the big break for them, the green economy.

WILLIS: OK. Well, Van, I'm going to have to interrupt you there. We will go to a live event. We appreciate your help today.

We're now going to Troy, Michigan, where Barack Obama is beginning to speak to a town hall meeting. Let's listen in.

(JOINED IN PROGRESS)

SEN. BARACK OBAMA, (D-IL) PRESIDENTIAL CANDIDATE: I want to think the principal of Troy High School, and our host today, Mark Nevack (ph), thank you.

(APPLAUSE & CHEERS)

OBAMA: I also want to thank Louise Schilling, the mayor of Troy for attendance here today and the great work she's doing. Stand up. There she is right there. I want to thank Eric Coleman, our Oakland County commissioner. I want to thank the wonderful mayor of Southfield, Brenda Lawrence, who just endorsed me today. Where is she? Stand up.

(APPLAUSE & CHEERS)

OBAMA: I want to acknowledge our Ninth District congressional candidate, Gary Peters.

(APPLAUSE & CHEERS)

OBAMA: And finally, I want to acknowledge somebody who is just doing outstanding work on behalf of the entire state of Michigan, I'm very proud to have his support, your terrific Speaker of the House Andy Dillon. Where is Andy? There he is, in the back.

Well, it is good to be in Troy. And it is good to be in Michigan.

(APPLAUSE & CHEERS)

OBAMA: I -- I have been running for president for about 15 months now. That's a long time. That means that there are babies that have been born and are now walking and talking since I announced that I was running for president. And when I announced that I was running, there were some people who said, you know, Barack, you've got a wonderful future ahead of you, but you're a young man. Why are you running so soon? You can afford to wait.

And what I said was, I'm not running because of some long-held ambition or because I think it's somehow owed to me. I'm running because of what Dr. King called the fierce urgency of now. The fierce urgency of now. Because -- because I believe there's such a thing of being too late. And that hour's almost upon us. I think about it. We are in the midst of two wars. One war in Afghanistan against al Qaeda and the Taliban, a war that we have to win, and a second war in Iraq that should have never been authorized, and should have never been waged.

(APPLAUSE & CHEERS)

But it's not just struggles overseas on people's minds. It's the struggles of folks here at home. And I think Doreen (ph) said it well, in terms of her own life. I know she speaks for a lot of folks here in Michigan. Wherever I go, I talk about the need to bring about real change. Few understand the need for change more than the people of Michigan because --

(APPLAUSE & CHEERS)

OBAMA: Because while we've been talking about recession in this country, for a few months now, Michigan has been living with it for a very long time; Michigan has the highest unemployment rate in the nation. Workers in communities across this state have been struggling for years with the downturn that all of America is feeling today.

Now, in fairness, some of these challenge is the product of larger forces beyond the control of government. We've got globalization. We've got technological advances. We have problems in the energy sector. But there's no doubt that the Bush economic policies have done little to help the working families of Michigan, or to build a better future for America.

(APPLAUSE, CHEERS)

And that, in large part, is what this election in November will be about. You know, I know that during this campaign in the primaries, there have been some worries about whether or not the Democratic Party will be divided after it's all over. There's been thinking, well, you know, are the Clinton folks going to support the Obama folks, and are the Obama folks going to get together with the Clinton folks? Let me tell you something, first of all, Senator Clinton has run an outstanding race, she's an outstanding public servant. She's and I will be working together in November. That's number one.

(APPLAUSE & CHEERS) OBAMA: But, the other reason I know the Democratic Party will be unified is because, no matter what else happens, come November, when you go into that polling place, the name George W. Bush will not be on the ballot. And I think all of us will be unified in making sure that George Bush's economic policies and George Bush's foreign policies are also not going to the White House because, unfortunately, as much as I admire John McCain -- John McCain is a genuine American hero -- he is running for George Bush's third term.

And that's why this election's going to be so important. John McCain says, we've made, and this is a quote, we've made great progress economically over these past eight years. And he's promising to do more of the same. This is what he said. He looked at Bush's economic record and he said, we've made great progress. I don't know who he was talking to. He wasn't talking to Doreen and all her fellow union workers who lost their jobs.

He's not talking to the folks in the state of Michigan. He's not talking to the speaker. He's not talking to the 47 million people without health insurance in this country. He's not talking to the millions of additional people that have fallen into poverty while George Bush has been in office. He's not talking to you. And he's not talking to me. And that's why we can't afford to let John McCain spend four more years with the same economic policies of George W. Bush.

(APPLAUSE & CHEERS)

OBAMA: Understand, since George Bush took office, we've gone through the first period of sustained economic growth since World War II, where the average income of an American family had actually gone down by $1,000. Think about that. Even when corporate profits were up, even when the economy was growing as a whole, your average wages were going down by up to $1,000. And 7 million more Americans don't have health care, 1 million more Americans are out of work. Millions of families are facing foreclosure because nobody was regulating the mortgage lending industry.

(APPLAUSE & CHEERS)

OBAMA: You are working harder. You're working hard for less. You're paying more for everything from college tuition to health care premiums to a gallon of milk to a gallon of gas. Now, to me, that is not great progress. That is a cause for concern and an impetus for change.

Yet, Senator McCain wants to double down on the Bush economic plan. Rather than reforming an unfair tax system and offering the middle class some relief, he's offering more tax loopholes for corporations and the wealthy that we just can't afford. Rather than making health care affordable for every American, like I've proposed. He's offering a health care plan that puts coverage at risk and that's designed for folks who are healthy and wealthy.

Rather than standing up for robust trade that works for all Americans, as I do, he's supporting more trade deals that work for Wall Street but not for Main Street. Understand, there's a reason the problems we face today are so much bigger than they were several years ago. A big part of it is that George Bush and John McCain have been so focused on pursuing a flawed and costly war in Iraq, that they've lost sight of the problems that have been mounting here in Michigan and here at home.

(APPLAUSE & CHEERS)

OBAMA: They have not been tending to the issues here in Michigan, here in Troy, here in the United States of America. Instead of working to fix our economy and lift up hard-working family, they've fought to extend a war that has cost us thousands of precious lives and hundreds of billions of dollars, and that has not made us more safe; a war that strengthened our enemies and distracted us from the need to go after bin Laden and the rest of Al Qaeda.

Just to put this in perspective, for what taxpayers here in Oakland County have spent in Iraq, you could be providing health care for 90,000 people, or offering 200,000 college scholarships for Michigan students, or hiring 30,000 more elementary school teachers. That's just for the money that you have spent in Iraq.

And now it seems like all Senator McCain is talking about on this campaign trail is Iraq, instead of offering real solutions to the problems that you're facing every day. Senator McCain conceded, not too long ago, that he didn't know too much about the economy. That's not his interest. That's not his priority. But I want you to know, Troy, Michigan, it will be my interest and it will be my priority when I'm president of the United States of America.

I want an end to a war that's costing America $10 billion a month and begin to use that money to invest in rebuilding our infrastructure, our roads, our bridges, investing in science and research, investing in a new electricity grid to get alternative energy to places that are needed to create broadband lines so every community can tap into the Internet superhighway. If people tell you we can't afford those things, to rebuild Michigan, to put it back on top, you just remind them, we are spending $10 billion a month in Iraq. We can spend some of that money right here in Troy, Michigan.

(APPLAUSE & CHEERS)

OBAMA: That's the choice in this election. Are we going to continue the failed Bush/McCain economic policies and remain mired in an endless and costly conflict in Iraq? Or will we change course and focus on problems that working families in Michigan and across America are facing every single day? I believe strongly that we are on the wrong path, that we need new priorities.

And so when people ask me, why are you running this time? I explain, we can't afford to wait to fix our schools. We can't afford to wait to fix our health care system. We can't wait to create a strong economy with good jobs that pay good benefits. We cannot afford to wait to end this war if Iraq. We cannot wait and that's why I'm running for president of the United States right here and right now.

(APPLAUSE & CHEERS) OBAMA: But I want to say this, though, the reason I decided to run was also because I was betting on you. I was betting on you, the American people because I was convinced that the American people were tired of a politics that's all about tearing each other down. You want a politics that's about lifting the country up.

(APPLAUSE & CHEERS)

OBAMA: I was -- I was convinced that you wanted a politics that was about telling the truth, honesty and straight talk from your elected officials, not spin and PR. But most of all, I was convinced that the American people were tired of a politics that divides us. I think you want a politics that brings us together. All people, black, white, Hispanic, Asian, Native-American, young, old, men, women, all of us coming together as Americans to solve our problems, to solve our challenges.

(APPLAUSE & CHEERS)

OBAMA: That's what's at stake in this election. I mean, I've got all kinds of good plans. I want to make sure that every child in America gets best education this country has to offer. You know, at Troy high school, Troy high school is one of the best schools in the country and the principal and the superintendent deserves congratulations for that.

WILLIS: All right. You've been listening to Senator Barack Obama speaking in Troy, Michigan, to a town hall meeting. Most of the speech about issue number one, the economy. Certainly most important probably in a lot of Michiganders' minds, they have the highest unemployment rate in the country there.

Obama also, there, coming back to John McCain, who spoke only hours ago, talking about the need to ratchet up the pressure on Iraq and Iran, questioning Barack Obama's ability to do that. Obama saying here that the biggest issue is, indeed, the economy and that's what we need to be focused on next.

Well, coming up next, we're turning the show over to you, answers to e-mail questions on the Help Desk. See your answers at Issue1@cnn.com.

(COMMERCIAL BREAK)

WILLIS: Time now to get the results of today's Quick Vote. For how you voted let's check back in with Poppy Harlow from CNNMoney.com -- Poppy.

HARLOW: Gerri, it looks like everyone is responsible.

We said who should be responsible for cleaning up the environment? And 83 percent of you said all of the above, when talking about government, the industry, and we, as individuals. So, Gerri, it looks like we all have to chip and do our part.

WILLIS: Well, I thought I'd have to chip in on that. Poppy, thank you.

It's that time of day again. Time to get you some help from the Help Desk, answers to e-mail questions. All right, let's get right down to it.

Stephanie Auwerter is with "Smart Money" magazine, Ryan Mack is with Optimum Capital Management, and Jennifer Westhoven -- our very own Jennifer Westhoven -- is with "Morning Express" on "Headline News."

Welcome, guys. Let's get right down to it. First e-mail is from Arizona. Our viewer asks, "It's been one year since my husband and I filed bankruptcy. How do we raise our credit score so we can take advantage of the housing market?"

So, Ryan, this person wants to spend money all over again. That is right thing to be doing now?

RYAN MACK, PRES., OPTIMUM CAPITAL MANAGEMENT: Well, definitely. The first thing you need to do is 35 percent of the credit report is paying your bills on time. Make sure you're on automatic bill pay, being responsible. And 70 percent of all credit reports have some sort of errors on them. Go to annual credit report at least twice during the next year to check out to see what your FICO score is, and make sure you're paying down as aggressively as possible all of your credit score, all of your credit cards, and just being responsible for the next year going forward.

WILLIS: Ryan, what is a good credit score to have if you are in the market?

MACK: We're looking at 750 or higher. About 41 percent of the country has credit score of 750 or higher; 11 percent of the country has 800 or higher. So we have to make sure we're in those good brackets to -- (INAUDIBLE).

WILLIS: Big numbers.

All right. The next question is from Kim in Pennsylvania, who asks, "We have been in the foreclosure process due to job loss. We're now trying to get a loan modification with $15,000 down and continue our 10.5 percent interest rate. It's still going to be tough and we may not be able to afford it. Should we file bankruptcy instead?

Stephanie, last-ditch step, right? I mean, what do you think?

STEPHANIE AUWERTER, EDITOR, SMARTMONEY.COM: And so many folks are in this situation. The thing to do really is to talk to your lender and see what your options are. The good news is that there a lot of options right now for folks in this situation.

My one concern is lots of times people really struggle to stay in their home when really it might be better to sell and get out and get into a place that you can more comfortably afford. So really talk to somebody and get some good advice. WILLIS: You know, there are a lot of people out there saying if you're having problems, just stop making payments.

Let's get the question from Irene, who asks, Why do I keep hearing that the need for biofuels decreases food supply? Are there not enough farmers and land to grow additional corn or soy, or that the supply going into food is not affected?

This is right up your alley, Jen. What do you think?

JENNIFER WESTHOVEN, CNN CORRESPONDENT: Irene is really hitting the nail on the head there. I mean, yes, there is not enough farmers and land right now. We just had this study, jointly put out by the U.N., that said we're going to have food inflation for nine years and big reason is because here in the United States we are taking grain and we are turning that into gasoline. And they said, over the next nine years, that's going to mean there are millions of people who go hungry. They even said that we should start looking at genetically modified crops to try and get as much food as possible.

WILLIS: Wow, tough stuff.

Bonnie asks, "As a college student with limited means what is the best way to begin long-run investing? How much money should I set aside? What should I invest" -- Ryan?

MACK: The best investment is always in yourself. She's in school. I don't know if she's like me when I was in college, but Ramen noodles was my meal of choice.

(LAUGHTER)

MACK: I think she might also want to just make sure she's researching and learning so when she graduates, college students don't have a lot of excess capital. You don't want to wrap it up in an IRA or something of that nature.

WILLIS: But you like the impulse, right?

MACK: Definitely. Learn as much as possible while you're in school. Save that money, maybe save enough -- in an IRA, like ING Direct, or something of that nature, for your first house fund or something like that.

WILLIS: Any additional thoughts, Stephanie?

AUWERTER: I think taking a little bit each month if you are inclined to get started investing and going into a broad-ranged index fund, no-load funds, the fees are really low. It's just a great thing to do. Do it when you're young and you're going to be in great shape.

WILLIS: All right, guys, great answers to tough questions. Appreciate your help. Stephanie, Ryan, Jennifer, thanks so much.

The economy's ISSUE #1 and we here at CNN, we are committed to covering it for you. ISSUE #1 will be back here tomorrow as will Ali Velshi, same time, 12 p.m. Eastern, right here on CNN.

CNN NEWSROOM with Don Lemon and Melissa Long starts right now.