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Senators to Vote on Modified Bailout Bill; Outlining Expected Troop Deployment; Southern Gas Supplies Returning to Normal; California's Calorie Count

Aired October 01, 2008 - 10:00   ET

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

HEIDI COLLINS, CNN ANCHOR: It's Wednesday, October 1st. I'm Heidi Collins. You are in the CNN NEWSROOM.
It is the biggest economic story of our time. A $700 billion plan to prop up the lending industry. President Bush calls it critically important, and you can bet he'll be putting on the pressure with senators set to vote on a modified bailout bill now after sundown. Will House members though get on board with it?

We're also watching the markets which have been giving investors quite a roller-coaster ride this week. Right now you see the Dow Jones industrial average down 136 points after yesterday's almost positive gain of about 500. So again, watching that very closely for you.

Meanwhile, we want to take a closer look now at the rescue package before the Senate as we speak and what it could mean for you and me. CNN's Christine Romans is in New York once again for us this morning.

So Christine, the Senate plan now would raise caps on FDIC insurance. Some people just tune out the second they hear that. What does it mean?

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Don't tune out. Both presidential candidates have asked for this as well.

And yesterday the chairwoman of the FDIC asked Congress to raise the cap from $100,000 to $250,000. That means specifically, if you're a small business, Heidi, and you've got payroll coming in or vendor payments going out and then more payments coming in, you can have a bank account that really swells and contracts, right?

And if your bank goes under and you're caught, then suddenly you could be above that $100,000 limit if you're a small business. So this protects people who might be business owners perhaps or people who don't want to have to have three different accounts instead of having everything in one account. So raising that FDIC cap is something that both presidential candidates have asked for, small businesses have asked for and also the FDIC chairwoman yesterday asked Congress to lift it up.

You know she said that you know the overwhelming majority of banks are very, very sound. But this is a crisis of confidence happening.

COLLINS: Yes.

ROMANS: Unfortunately people were having a real lack of confidence in the their banks. And so she wanted to really push for it to do this, to try to you know restore some confidence in the system.

COLLINS: OK. So the Senate has added some other items though to sweeten the bill even further. What have they included now?

ROMANS: That's right. OK. They added a renewable energy tax incentives on there. You know, a critic would point out that it has nothing really to do with freeing up the flow of credit between banks and between companies. But this is what they've added on there. Alternative minimum tax relief. There's a ritual in Washington on both sides of the aisle about getting that AM Tax relief. It was never meant to hit working middle class families but it is. But at the same time, our budget frankly is addicted to that revenue. So that's a real fight always over that AMT.

And also something called a Mental Health Parity. It will required insurance companies to cover mental illness on par with a physical illness. So those three things are sort of tacked down there among some other things. But part two, they're expecting to vote on this one later today. And we'll see how this one goes.

COLLINS: Yes and part of me wants to say, certainly no disrespect to you in any way, shape or form. It's kind of like blah, blah, blah right now.

What is happening every day as this thing sort of just looms out there and people in Washington are still talking, talking, talking, talking? What is happening to my money, to your money, to our financial system?

ROMANS: It's a slow bleed. It continues to be a slow bleed. And we're numb to it every day because we still have our jobs and everyone around us still have their jobs. Some people have been telling me, until people start to lose their own jobs, they won't realize just how kind of immediate all of this is. But it's a slow bleed that is getting worse with jobs, with home prices. We saw mortgage applications absolutely plummet.

We know that the credit market is frozen up here right now. If you're trying to get a student loan, you know that this is happening. If you're trying to get a car loan, you know this is happening. Now, I will say though I have been talking to some people and getting e- mails from people, Heidi, who say, listen, my bank just called me and said, hey, do you want a home equity line of credit? You really got a good background, you know, maybe this is now the time.

So there are some people who are telling me they are getting loans. They are getting credit. And they're even hearing from their banks. But you're right, it's numbing, isn't it? Every day big stories, moves in Washington, waiting to see what happens next.

COLLINS: Yes. I think it would be interesting to know what the requirements are and what kind of person, what kind of credit you have to have.

ROMANS: These are extremely good credit with good - you know ten years in the same job. I mean the best advice that I can give that I keep getting is keep your job, pay your bills, don't take any financial risks right now. Just wait to see how this plays out.

COLLINS: All right. CNN's Christine Romans. It's hard to do. But we sure do appreciate that. Thank you.

The stakes of reviving the economic package are so high. Senators Barack Obama, John McCain and Joe Biden do plan to take a detour from the campaign trail later today and be in Washington for the vote. First though, Senator McCain campaigns independent Missouri, Senator Obama in La Crosse, Wisconsin. We're going to hear from both of them coming up shortly.

Senator Biden, by the way, in Wilmington, Delaware, prepping for his big debate with Governor Sarah Palin, we know will be happening tomorrow. That is also when the House is set to take up the bailout bill again after voting it down on Monday. So why is the Senate voting on it today? Kate Bolduan on the Hill for us this morning.

Yes, some people may wonder why is the Senate voting now and we're going to wait another for the House and will all the votes come together in the end anyway?

KATE BOLDUAN, CNN CORRESPONDENT: That is a lot of questions that have very many different answers to it. Just to sum up why in the Senate, well, the House leaders thought it would be best and hopefully gain more support if this bill in a tweaked form which we can see it's modified, if it started in the Senate, would pass with good broad support and gain support as it moved back to the House. That is what they are hoping for. Will it have the votes? That's the big question.

Today you can be assured that staff and lawmakers are all being briefed on what this modified bailout rescue plan is going to include. And since that House version failed this week, Senate and House leaders have all been working together behind closed doors, in front of cameras as well, trying to negotiate a deal together and really figure out what is the delicate balance that they can strike to get the votes they need without losing votes that they have right now.

But despite the setback from the House vote, Senate leaders say that they are still focused on getting something passed quickly in both the House and the Senate. Listen here.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D), MAJORITY LEADER: The blame game needs to end, and we need to move forward on doing what's right for our country.

SEN. MITCH MCCONNELL (R), MINORITY LEADER: We will get the job done. We'll get it done this week. And I think hopefully that will reassure the American people that Congress can rise to the occasion, act like grownups, if you will, and get the job done.

(END VIDEO CLIP)

BOLDUAN: Get the job done. That seems to be what is the focus today. At the same time they're all keeping an eye on the markets. We all know how the market plunged almost immediately after the House vote. And also what they're dealing with is a lot of pressure coming from constituents, Heidi, a mass, an influx of e-mails and calls from constituents back home, not only those who are against the bailout. We heard a lot about that leading up to the House vote but now I've heard from a top House Republican aide who says the tone of these calls and e-mails has shifted, described to me as dramatically. Saying they're not only hearing from people against it and also from people who are now mad that they haven't done anything yet.

COLLINS: Yes. I think there's a lot of those people in both camps. No question about it. All right. CNN's Kate Bolduan from Capitol Hill.

Thank you, Kate.

This is a plan to rescue the lending industry, the same industry involved in the mortgage crisis. Taking effect today, another measure passed by Congress and signed by the President to bring some relief to struggling homeowners. It establishes a $300 billion fund to help those homeowners as well as opening up possible lines of credit from the Treasury to mortgage lenders Fannie Mae and Freddie Mac. Just note, none of the new money is likely to go anywhere for at least 60 days.

Now to the war in Iraq. The Pentagon announcing the 2009 troop deployment there. We want to go live to our Pentagon correspondent Barbara Starr with more on this.

What does this troop deployment look like now for next year?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Heidi, this is the expected troop deployment. Let's be clear, this is the rotation of troops into Iraq, about 26,000 additional troops rotating in, replacing the troops that are finishing up their tours of duty and coming home. But it's very significant. Troop levels still very high in Iraq. And that means no additional troops really available for Afghanistan. That issue front and center here at the Pentagon this morning.

General David McKiernan is here in town, the top U.S. and NATO commander in Afghanistan. He wants 20,000 more troops for his war in Afghanistan. And unless they can free them up from Iraq, that's not going to happen any time soon. General McKiernan talking about just how serious the security situation is in Afghanistan.

(BEGIN VIDEO CLIP)

GEN. DAVID MCKIERNAN, NATO INT'L SECURITY ASSISTANCE FORCE: We're facing a tougher threat right now, especially in the east where we have a U.S. division. We see an increased number of foreign fighters in the east, increased levels of violence, people that generally don't feel secure, don't have freedom of movement. And so the additional military capabilities that have been asked for are needed as quickly as possible.

(END VIDEO CLIP)

STARR: But while we're talking about price tags all over Washington, just consider this. The wars in Iraq and Afghanistan are now running about $12 billion a month. No end in sight at this point to either of those conflicts. So it's a pretty hefty price tag out there that Congress is going to be looking at as well as all the other finances they're trying to sort out. Heidi.

COLLINS: CNN's Barbara Starr at the Pentagon. Thank you, Barbara.

The war in Afghanistan is front and center at the White House. Today, the top commander in Afghanistan, who we just heard from in Barbara's reporting, will brief President Bush on stability and security in the war-torn country. That meeting taking place this afternoon in the Oval Office.

A key defense witness scheduled to take the stand today in the O.J. Simpson case. Simpson's attorneys say today's testimony from a friend of Simpson's could be their last witness in the armed robbery and kidnapping case. Prosecutors say Simpson planned the robbery of two sports memorabilia dealers. The defense claims that Simpson was just retrieving what had been stolen from him.

What you're saying now about the election. New poll numbers from the best political team on television.

(COMMERCIAL BREAK)

COLLINS: We have some new numbers to share with you this morning. With just over a month ago until the presidential election, we want to get right to it with our deputy political director Paul Steinhauser. He's joining us now from St. Louis, the site of the vice presidential debate, coming up tomorrow night.

Hey there, Paul. How do these numbers look? Any surprises?

PAUL STEINHAUSER, CNN DEPUTY POLITICAL DIRECTOR: Yes, some interesting numbers, Heidi. Well, I just want to say, the professor of politics himself, Bill Schneider in the next hour so you got a substitute teacher right now. But let's take a look at this.

We came out this morning with a brand new CNN poll of polls taking a look at the national numbers. And it's interesting, you got Obama 49 percent, John McCain 44 percent. These are kind of similar to where they were before the first presidential debate. And while the first presidential debate was very interesting and you heard a lot about where they stood on the issues, I guess we really didn't have much of a change. It really didn't change too many people's minds yet. But we've got three more debates to go. We also came out this morning with some new numbers in Pennsylvania, a crucial state the Democrats have won the last four elections. But it's been close. Take a look at this poll of polls here with Barack Obama up by 10 points over John McCain in Pennsylvania, 21 electoral votes at stake in that state. You're going to see both candidates spending a lot of time there.

Later today we've got our own CNN polls coming out, CNN/"TIME" Magazine and opinion research corporation. We're going to be pulling in four states. And I can't wait to see these numbers. First of all Florida, the biggie. Two new polls came out, one with Obama up by 7, one by one. So it will be interesting to see what our numbers show.

We also have some new numbers in Virginia. We're also going to have some numbers in Minnesota, Nevada and right here in Missouri. So we're going to take a look at these numbers a little later today and pour through them.

COLLINS: So when we look, Paul, at the current CNN electoral map, does that mean that there are some changes that are expected? Or what do you think?

STEINHAUSER: Yes, I think there's a really good chance we can make changes in the electoral map. Take a look where it currently stands right now. This is our map you can find it on CNN.com. And if the election were to be held today, let's say, we suggest that Barack Obama would win about 240 electoral votes, John McCain 200 electoral votes with 98 still up for grabs in these so-called toss-up states, battleground states. Remember you need 270 electoral votes to win the White House. And you can go online as well and you can find of be your own tactician here and decide which state goes which way. So it's interactive as well. but I think when we take a look at our polls today and some of the other voting trends, we make some aid, make some adjustments in the map. So stay tuned.

COLLINS: All right. We'll be watching.

Thank you -- CNN's Paul Steinhauser.

Senator Joe Biden, is he trying to lower expectations ahead of tomorrow night's vice presidential debate? Our Tom Foreman takes a look at his balancing act in about 15 minutes or so.

Meanwhile Alaska Senator Ted Stevens trial resuming this hour with his one-time friend returning to testify against him. Oil executive Bill Allen expected to say his employees spent hundreds of hours renovating Stevens' home. The senator is accused of not reporting that gift.

Gas in short supply. Drivers in long lines. It's been a pain in the south. So any relief today?

(COMMERCIAL BREAK)

COLLINS: We want to give you a look at the big board now. We are down by triple digits. There you see for yourself, 162 points after yesterday's big gain. So as we've been reporting and probably most of you expected, kind of a roller coaster ride as we go through this current financial crisis. We will watch those numbers for you.

Also watching this story, long gas lines are getting shorter now in the southeast. More stations have gas and supplies are returning to normal. But many anxious drivers still following delivery trucks around to service stations. I've seen it myself. And truck drivers have a message for them.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Don't panic and (INAUDIBLE). Stay out of my way so I can get out of the gas station and go get another load.

(END VIDEO CLIP)

COLLINS: A spokesman for the pipeline that carries gas from the Gulf coast to the Atlanta area says flow is back to pre-hurricane levels.

Look at this now. It's a price we haven't seen in quite a while. At least one station in Topeka, Kansas, selling regular gas for $2.99 a gallon. Cheap gas by today's standards. That's for sure. You better believe drivers were lining up for it. AAA says the national average for regular is now about $3.62 a gallon.

It will be a tough choice this winter if you warm up your car before you get in, you'll burn a lot of expensive gas. CNNMoney.com's Poppy Harlow takes a look in our "Energy Fix."

POPPY HARLOW, CNNMONEY.COM: With the economy in rough shape, U.S. automakers are certainly hurting. But one Minnesota company says people are still spending when it comes to upgrading their vehicles, albeit in a different way.

(BEGIN VIDEOTAPE)

BRIAN ADAMS, OWNER, TINTMASTERS: Trends for new vehicles more than anything. I'd say used vehicles definitely have fallen off a little bit. The used cars, the dealerships we work with, definitely have kept us going.

HARLOW: Absolutely freezing in Minnesota in the winter. I'm from here. Take my word for it. Brian can tell you, it's frigid. Let's go in and let's take a look at these car starters. OK because I was shocked to hear how expensive they are.

ADAMS: Up to about $700. That's basically your Cadillac of remote starts. It gives you a wide range of different information from the vehicle, the temperature in the vehicle. Around here the temperature starting, so you know when to start your vehicle, if it's getting that 0 degree mark. It works really, really well. They come as a factory option of a 15 or 25-minute run time. I would say a few years ago people were doing 25 minute, not such a big deal. Say now, most everybody that comes in just does 15 minute run cycle. HARLOW: I know your company has made a lot of money installing these audio systems right now but people are going for a little bit on the lower end price range there right?

ADAMS: People are spending more like a $200 budget where before people were coming in and easily spending $1500.

HARLOW: One thing people don't always think about is that tinting windows can actually be make your car more efficient when it comes to running the heat and running the airconditioning, right? So it might save them money in the end?

ADAMS: Right. I mean, it's probably going to be pennies on the dollar. But tinted windows not only saves on your interior but acts as an insulant on the glass, which obviously helps when you're running the air conditioner. The air conditioner doesn't have to work as hard which obviously makes the motor work harder if the air conditioner has to work hard. So you might save a little bit here and there, same with the heat that's going to insulate the vehicle.

(END VIDEOTAPE)

HARLOW: Of course, it will be interesting to see how often people actually use those car starters this winter, especially if we see another spike in gas prices. After all, you're getting zero miles per gallon and you're just burning through gas. In frigid Minnesota, that will be a tough choice.

COLLINS: You can follow your fortunes at CNNMoney.com. We've got all the day's market news and numbers, expert analysis and a whole lot more. So you can check it out for yourself.

Joe Biden is known for saying what's on his mind. Why he might not be so outspoken in tomorrow night's vice presidential debate.

(COMMERCIAL BREAK)

COLLINS: Watching Washington and the markets. A record plunge on Wall Street Monday, a record rebound yesterday. So how do those stocks look today? You see it there, down triple digits, 164 points on the Dow Jones industrial average. In the hours leading up to a Senate vote on its version of a financial rescue plan, Senators McCain, Obama and Biden all plan to be there for it. The House voted down a similar bill on Monday. Lawmakers there plan to take up the issue once again tomorrow.

Some say he's got the edge in experience, but Joe Biden is not playing that card in the run-up to tomorrow night's debate with Sarah Palin.

Our Tom Foreman looks at Biden's strategy.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN ANCHOR: He thoroughly knows international affairs. She doesn't. He spent decades learning the ways of Washington. She hasn't. Yet Joe Biden is furiously lowering expectations for his debate with Sarah Palin. I have great respect for the - when I hear and watch some of the debating skills of Governor Palin. I think it's going to be a really tough debate. But I think this is all about where we are.

FOREMAN: Biden has reason to be cautious. His running mate, Barack Obama beat Hillary Clinton by making her Washington experience a weakness, and Palin is calling Biden an insider every chance she gets.

GOV. SARAH PALIN (R), VICE PRESIDENTIAL CANDIDATE: I'm looking forward to meeting him, too. I've never met him before. But I've been hearing about his Senate speeches since I was in, like, second grade.

FOREMAN: What's more, Biden is notoriously known for speaking his mind and sometimes putting his foot in his mouth, like recently when he said his helicopter was forced down during a visit to Afghanistan earlier this year. It was, but by the weather, not by enemy attacks. He attacked his own campaign for a recent ad criticizing McCain's computer skills.

SEN. JOE BIDEN (D), VICE PRESIDENTIAL CANDIDATE: I thought that was terrible, by the way.

KATIE COURIC, CBS HOST: Why did you do it then?

BIDEN: I didn't know we did but if I had known anything about it, we wouldn't have done it.

FOREMAN: That tendency could make him go for the jugular against Palin. And since previous attacks on her have brought accusations of sexism. Ken Vogel with politico.com says watch out.

KEN VOGEL, THE POLITICO: If I'm Joe Biden's people, I'm telling him don't go after her too aggressively. Make sure you're respectful call her Governor Palin, not Sarah. And don't point out if she makes a major gaff. The media will do that for you after the fact.

FOREMAN (on-camera): Joe Biden was already in the Senate 20 years ago. So he knows personally about the last vice presidential debate to shape up this way. That's when the first George Bush picked a young senator as his running mate.

(voice-over): When Dan Quayle invoked the spirit of John Kennedy while debating Lloyd Bentsen, the more experienced senator steamrolled him.

LLOYD BENTSEN (D), FMR. U.S. SENATOR: I knew Jack Kennedy. Jack Kennedy was a friend of mine. Senator, you're no Jack Kennedy.

FOREMAN: But Joe Biden also knows the punch line that followed. Although the Democrats won the debate.

GEORGE H.W. BUSH, FMR. PRESIDENT OF THE UNITED STATES: I, George Herbert Walker Bush do solemnly swear -- FOREMAN: The Republicans won the White House.

Tom Foreman, CNN, Washington.

(END VIDEOTAPE)

COLLINS: Changing the discussion, Senator John McCain on the road today trying to break down the financial crisis in an attempt to connect with voters. CNN's Dana Bash is live in New York this morning. There's so much go-around about this.

What's important to some people isn't as important to others and on and on, Dana. What is Senator McCain saying when he reaches out?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: We'll we're going to hear from him in about half an hour, he's going to be speaking at the Truman Library in Missouri. And he's, basically, in talking to some of his advisers this morning, he's going to be doing, Heidi, what we've been hearing from our own experts, Ali Velshi, Christine Romans, trying to put aside this idea that this is a bailout for Wall Street and try to connect it to average Americans, average everyday voters and say this is absolutely critical for you. They realize inside the McCain campaign and frankly it's clear from his changing rhetoric inside the Obama campaign that the way the they've been framing this is a big political loser.

So, he's going to say this is about students trying to get loans for college, about airlines in trouble. Things that people can really relate to. And the reality is, Heidi, that Monday when this failed in the House, it was in a way old-fashioned democracy. Because these lawmakers were hearing from their constituents saying, are you crazy, you're going to bail out the fat cats on Wall Street.

So, what McCain is going to try to do is make it a lot less about that and more about average Americans. And that's where we're going hear from him in about half an hour, previewing why he's going to go back later today and vote for this package.

COLLINS: What's it going to take? And I know you may not know the answer. But it's so interesting to me to try to understand what it's goings to take for any of these candidates -- I don't care Republican or Democrat, to help people to understand what this is about. And to help them trust in some type of leadership in order to get this bill through, in any form.

BASH: It's going to be extremely hard. I mean, and that is evidence in what we have seen with regards to the past week. The vote on Monday and the disconnect, frankly, that a lot of Americans are feeling between -- seeing between how they feel and how people in Washington are acting.

I think the good news, if there is any good news for John McCain here, is that with regard to this kind of feeling your pain issue that politicians have to do, both McCain and Obama have had problems with this as well as their colleagues in Congress. So that is what McCain is trying to get a leg up, a little bit on Obama by at least changing the rhetoric. At least that's what we've been told he's going to do today.

The answer is it is really unclear if that is going to pan out. But, with regard to the issue of the economy, I mean, poll after poll shows that it is as people would expect. That as the economy has gone south, as that crisis has gone hotter and hotter, John McCain's numbers in key battleground states and on the national level have gone down. So, they are very much hoping that this does sort of plateau and finishes out in the Senate today and maybe the House in the next couple of days so they can turn the corner and move on to other issues, other topics, other political approaches that they feel is more in their comfort zone.

COLLINS: All right. CNN's Dana Bash. Thanks so much, Dana.

Of course, you can join us for live coverage of tomorrow night's vice presidential debate. That debate beginning 9:00 p.m. eastern. You can also watch little bit earlier for that for opinions an analysis from the best political team in television.

(WEATHER REPORT)

Federal investigators are going to take a closer look at a post Katrina police shooting case in New Orleans now. Seven officers were accused of killing unarmed civilians on this bridge in the chaotic days just after the hurricane. This was the reaction after a judge dismissed the charges in August. Six of the officers are still on the force. They were assigned to desk duty after being charged in the case. Federal authorities including the Justice Department's Civil Rights Division will now conduct their own investigation.

A settlement now in the death of a woman crushed in a Boston traffic tunnel. The July 2006 accident marked another low point for Boston's so-called Big Dig project. The woman was killed by falling concrete. Her family filed a wrongful death lawsuit against the project's leaders including the Massachusetts Turnpike Authority. They will get more than $28 million in the settlement.

Well, they are still waiting on Washington. But, with a bailout bill pending, business goes on. Checking numbers and nerves on Wall Street.

(COMMERCIAL BREAK)

(BUSINESS HEADLINES)

COLLINS: Quickly now. Want to get to our Pentagon correspondent Barbara Starr, who is standing by to give us the very latest about suspicious item, at least that's what it was called in the beginning, Barbara, that was found in D.C.

What do we know at this point?

STARR: Well, Heidi, U.S. Military officials have just confirmed to CNN, that in conjunction with other security personnel here in Washington, D.C., they are responding to a live grenade-like device found in downtown Washington this morning, at the corner of 16th and Kennedy Street.

Now that is 16th Street, but several blocks from the White House. This grenade-like device was found in a trash can next to the Egyptian embassy. Area has been evacuated. All traffic has been stopped. A military explosives disposal team is there. One detail. There are still four civilians inside the Egyptian embassy where this was found. They are trying to get those people to please come out and leave the area before they deal with the explosive device.

Military teams, very experienced in these matters. But they're taking all precautions, stopping all traffic in this very busy area of downtown Washington, taking no chances, clearing the area and then they plan to move in and try and deal with this grenade-like device that was found and reported to federal authorities this morning -- Heidi.

COLLINS: Yes. And certainly not that this happens regularly or anything, Barbara. But when you talk about what they do in a case like this, will they then automatically go to the Egyptian embassy and try to find out if there might be any link because of the proximity?

STARR: Well, I think, you know, what they're going to probably do is conduct a fairly immediate investigation trying to look at what this device actually is. Whether it's home made, military issue.

And in Washington, D.C., of course, when these incidents do happen, and they are next to an embassy, there's always a lot of concern about the safety of the personnel there. Washington is home to diplomats from around the world. And the U.S. government takes very seriously trying to keep everyone safe here in Washington.

So they will be trying to find out very quickly, including personnel from the State Department of course, who help protect the embassies, trying to find out very quickly exactly what is going on here. But the first order of business, get everyone out of the way, get rid of that device and then see exactly what they're dealing with -- Heidi.

COLLINS: Absolutely. Thank you, Barbara for that. Let us know if you learn anymore. Our Pentagon correspondent comes to us from Washington, Barbara Starr.

Thank you.

Overseas investors are reacting to what's happening in this country. At last check markets in both Germany and London are up now. Germany taking a bit of a tumble. Hong Kong on a holiday break. Remember, you can keep up with all of the markets at CNNmoney.com.

It's a culture based on cash, not credit. Japanese consumers could teach many Americans a lesson or two.

Here is CNN's Kyung Lah.

(BEGIN VIDEOTAPE) KYUNG LAH, CNN INTERNATIONAL CORRESPONDENT (voice-over): At this ATM machine, customers aren't just withdrawing, they're putting money in.

MISAKO OSHIRO, BANK CUSTOMER (through translator)" I try to save my money little by little when I get paid, says Misako Oshiro.

LAH: And while she does have a credit card in her wallet, she barely uses it.

Across Asia from China to Japan, cash is king. The idea of leaning on plastic. I don't think so says this banking customer.

(on camera): It is a cashless society in parts of the U.S. and carrying a balance on a credit card is relatively common. Here in Japan, the idea is still a foreign concept even though the credit card has been here for decades.

(voice-over): American Glenn Williams, who has been living in Japan on and off for 13 years, says he sees a difference in how the cultures approach credit.

GLENN WILLIAMS, AMERICAN EXPATRIATE: They don't expect to have everything. Their parents didn't have everything. It's not quite as much as the U.S. where we need to have the 50-inch television now or the brand new car all the time.

LAH: But a robust credit system isn't negative says economist Richard Jerram.

RICHARD JERRAM, CHIEF ECONOMIST, MACQUARIE: So, I thinks simply because the Japanese system is if you're like more old-fashioned. I think it doesn't necessarily mean it's better. There seems to be an assumption that credit is bad, risk is bad. Where in reality a controlled amount of credit is a very healthy thing for an economy and Japan in many ways, seems to lose out by having a less dynamic financial system.

LAH: For the consumer, it's all and how you use it.

OSHIRO: If there's something I can't afford, I'll wait, says Misako Oshiro.

LAH: And that's what may separate the financially healthy from the troubled, no matter what country you're in.

Kyung Lah, CNN, Tokyo.

(END VIDEOTAPE)

COLLINS: Looking for help and eating healthier. A major food company taking the guesswork out of counting calories.

(COMMERCIAL BREAK)

COLLINS: Some news about your health now. A picture's worth a thousand words. Beginning today graphic pictures showing the devastating affects of smoking are showing up on cigarette packs in Britain. One of them warns smoking when pregnant will harm your baby. Another shows how smoking can cause lung cancer. And in another, people who light up can see how smoking causes aging skin. All part of the government's attempt to stop people from picking up the habit.

New discoveries of tainted milk powder in China. China's government says an extra 31 batches of Chinese milk powder were found contaminated with the industrial chemical melamine. The government says that brings the total to at least 100. The tainted milk is blamed for the deaths of four children and for making some 54,000 others sick.

Checking your calorie count. California, trying to make it easier for people who eat out. Governor Arnold Schwarzenegger signed a bill requiring chain restaurants to reveal calorie counts in writing. They're the first state to do that in fact. The new law goes into effect next July. Many national fast food chains already provide that information for customers.

One of those stepping up to the plate is Yum! brands. Yum! owns fast food chains like KFC, Taco Bell and Pizza Hut. They say they're going to start putting calorie information on their menu boards. That order goes for about 4,000 company-owned restaurants nationwide. They are also encouraging about 16,000 of their independently owned franchises to follow suit.

Well it's the understatement of the year in Bakersfield.

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UNIDENTIFIED FEMALE: I wasn't surprised, but I was sad, because this is a 12-year-old young man that's obviously got some real trouble.

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COLLINS: So what did the boy do? Police say he stole an SUV in his neighborhood, led them on a chase at speeds topping 80 miles an hour, rammed a patrol car and they say he was drunk. The chase ended when the child crashed the SUV into a pole. No one was hurt. The boy was arrested.

Want to let you know we are awaiting two campaign events, one of them from Barack Obama, the other from John McCain. John McCain in Kansas City, Missouri, and Barack Obama in La Crosse, Wisconsin. Those events we understand to begin in about 10 minutes or so. You see Obama on the right there, or at least his event I should say. And on the left, the event for John McCain. So we'll bring them to you when they happen.

Financial fear factor. Americans rating it on a scale from 1 to 10. So how is it adding up?

(COMMERCIAL BREAK) COLLINS: Preserving an icon. You can't tell from these pictures, but this is the flag that inspired the national anthem. The flag hasn't been seen by the American public in 10 years. That's when the Smithsonian actually took it out of the National Museum of American History for a facelift. Look how big that is. The restoration is almost complete. The flag will be ready for display. It was moved this morning to its new home at the heart of the museum.

Numbers are important on Wall Street. And for Americans rating their financial fear factor, CNN's Jeanne Moos has an unscientific survey.

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JEANNE MOOS, CNN CORRESPONDENT: All those screaming headlines from the day the market plunged -- "Meltdown"; "Now what?"; "What now?"; "What a Mess"; "Well, that Didn't Work; "Where do we go from here?"; "Ouch."

This is starting to sound like a Sarah Palin interview. But all joking aside --

STEPHEN COLBERT, HOST, "THE COLBERT REPORT": Calm down.

MOOS: How calm or panicked are people, regular people?

(on camera): Your personal financial fear level, on a 0 to 10 scale, 10 being petrified?

UNIDENTIFIED MALE: Ten.

UNIDENTIFIED MALE: Six.

UNIDENTIFIED MALE: Definitely an eight.

UNIDENTIFIED MALE: Good eight.

UNIDENTIFIED FEMALE: Probably a 7.

UNIDENTIFIED MALE: Probably five.

MOOS (voice-over): Here is a five's financial philosophy about the safety of keeping money in the bank these days.

UNIDENTIFIED FEMALE: What are you going to do? Where are you going to put it? In your sock?

UNIDENTIFIED MALE: I put some money under my mattress last night.

MOOS (on camera): Literally?

UNIDENTIFIED MALE: Literally. I put some money under my mattress.

MOOS: If I went to your house and looked under your mattress, I'd actually find money?

UNIDENTIFIED MALE: You would. I'm not going to tell you where I live though.

MOOS (voice-over): He rated his fear level at 9.

The most commonly picked level --

UNIDENTIFIED MALE: I'd say about seven.

UNIDENTIFIED MALE: Seven.

UNIDENTIFIED MALE: Seven.

UNIDENTIFIED MALE: Eight.

MOOS: This eight abandoned his bank.

(on camera): So you had money in it and you took it out?

UNIDENTIFIED MALE: Took it all out.

MOOS (voice-over): On the opposite end of the scale--

UNIDENTIFIED MALE: We're buying stocks today. It's a great day to buy.

MOOS: He's buying battered and cheap financial stocks --

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COLLINS: Quickly we want to get you to the political event that we have been telling you about because Senator John McCain has actually come to the podium. Let's listen in for a moment to him in Independence, Missouri.