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Bailout Bill Revisited; Reacting to VP Debate Performance; Credit Crisis hits Americans Nationwide; Wachovia Ditches Potential Citigroup Deal
Aired October 03, 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: Rejection, revision, reconsideration. Bailout bill, round three. House members talking about it right now. Will they be voting any time soon?
And speaking about talking and voting, running mates had their say last night. Will it change your choice next month?
Plus warrior returns home with quite a facelift. The intrepid's curator comes on board with us this Friday, October 3rd.
I'm Heidi Collins. You're in the CNN NEWSROOM.
Watching Washington and Wall Street this hour. The House already busy debating a reworked financial rescue plan. The $700 billion bailout would allow banks and other institutions to sell their troubled assets to the government among other things. Investors also digesting the latest unemployment figures. You can see the big boards there up 153 points. Dow Jones industrial average is watching all of that for you today. in fact, we do have every angle covered.
Brianna Keilar on Capitol Hill. Allan Chernoff dissecting the jobless reports and Susan Lisovicz in the middle of all that trading at the New York Stock Exchange.
I want to begin though with you Brianna, and the big bailout debate. We know that earlier we showed a picture of the House. They were trying to set up the rules for this thing. Where are we at now?
BRIANNA KEILAR, CNN CORRESPONDENT: Well, they're still debating. It's called debating the rule but its basically just some of the preliminary debate on the bailout plan. That's what's going on right now. This began just in the last hour. We heard from House Speaker Nancy Pelosi last night. She said support was growing for the bailout plan. We also heard from Congressman Roy Blunt, really the point person for House Republicans on this plan. And he said a vote was expected. So the bottom line, at this point we're expecting a vote midday today. That's about as specific as we can get.
However, as you know, it's still very much a contentious issue, whether or not to go for the bailout as evidenced by some of the speeches that we're hearing as we speak on the House floor.
(BEGIN VIDEO CLIP)
REP. DAVID DREIER (R), CALIFORNIA: This important but imperfect bill or, Madam Speaker, we can do nothing. We saw on Monday the consequences of doing nothing. Today we have a second chance.
REP. BRAD SHERMAN (D), CALIFORNIA: Wall Street wants the $700 billion so bad they can taste it. To get it they need two things. First, you create panic. Then you block alternatives, and then you herd the stampeding cattle toward passing a bad bill. We are told that we must act in hours. The fact is, we have taken two weeks, and we can take another week, not a week of trying to jam us with a bad bill, but a week of writing a good bill.
(END VIDEO CLIP)
KEILAR: House Speaker Nancy Pelosi has said there will be no vote midday today unless there is the support needed to pass this. So at that point, Heidi, I mean, it could be canceled in a way. They could pull this and not vote for it. Obviously that would really catch a lot of attention if they did that.
COLLINS: No question about it. All right. CNN's Brianna Keilar on Capitol Hill. Brianna, thanks for that. And while lawmakers debate more worrisome economic numbers from the government. Allan Chernoff in New York now reading between the lines of this latest jobless report.
What's the bottom line here, Allan?
ALLAN CHERNOFF, CNN SR. CORRESPONDENT: The bottom line is that the unemployment situation is not good. And I can tell you Wall Street is watching that bailout discussion in the House very, very closely. If they do not act, you better believe Wall Street is going to get increasingly worried and the jobs picture - the outlook for the job picture certainly could deteriorate. The news this morning, payroll down by $159,000 in the latest month in September. We've had declines for nine consecutive months in that number in payrolls, and this is the worse of them all.
Typically we do see a drop in manufacturing employment, obviously construction has been down for quite some time. But now add in services. That's where the growth in the economy has been. Forget about it. Now we're seeing a decline. And the situation is likely even worse because the average workweek actually diminished. So that indicates that the employment situation could be getting worse. The good news here, at least the unemployment rate remains steady at 6.1 percent. But economists say that, too, is likely to go up -- Heidi.
COLLINS: And meanwhile, all this talk - we still haven't been able to bring up the credit situation as Washington continues to discuss this potential bailout. I do wonder if they OK it, could that then slowly turn around this employment picture, this jobless numbers that we're getting?
CHERNOFF: Emphasis on the slow. Eventually if the bailout bill goes through, hopefully, the hope is that that will put some grease into the wheels of lending, you'll get capital moving around, you'll get banks lending to each other once again. Companies, consumers will be able to borrow. And eventually we will see a turn in the economy. The problem is, the longer they wait, the longer that turn is down the road and, believe me, it's not going to happen instantaneously.
Congress could approve that bill this very minute. The President could sign it. You're not going the see an instant turn-around. Economists forecast that the employment picture will get worse over the next few months.
COLLINS: Allan, thank you.
Investors certainly not loving those jobless numbers either. But stocks are higher anyway. Susan Lisovicz is here now to talk a little more about that.
So what's going on in the New York Stock Exchange? We have seen so many highs, so many lows. Typical, is it not?
SUSAN LISOVICZ, CNN CORRESPONDENT: Well, you know, that is certainly the jobs report. The monthly jobs report is a market mover. But we have another major headline today, Heidi, and that is a major deal in the financial sector which is really the epicenter of where so much of the turmoil and fear resides on Wall Street. And it doesn't involve Uncle Sam's help. Imagine that.
COLLINS: Yes.
LISOVICZ: Wachovia, which is a bank that is based in Charlotte, North Carolina, walking away from a tentative deal it struck at the beginning of the week with Citigroup. Citi was going to buy Wachovia's banking assets for cheap, for $2 billion. It was kind of a desperation deal. At the close week ago, at the close of trade Wachovia shares had collapsed. They lost 95 percent of their value. There was this sense that Wachovia was going to be the next to fall, whether it was right or wrong, these are the times we live in.
Remember, Washington Mutual, the nation's largest collapse, that banking collapse occurred last week. So Wachovia and Citigroup kind of got together over the weekend, but it was a deal done on the cheap. And now Wells Fargo, a bank based in California said, you know what, it's going to do an all-stock deal with Wachovia.
COLLINS: OK.
LISOVICZ: It's going to buy the whole thing for nearly $15.5 billion. What's happening as a result is the financial sector is on fire. Wachovia shares right now up 78 percent. Wells Fargo shares are up nine percent. The lone exception, Citigroup. The move was seen by Citigroup as a defense measure to shore up its deposit base in these fearful times. Citigroup shares are down 12, 13 percent.
COLLINS: OK, quickly, if you're a Wachovia customer, are you happy? Do you care about this? Does it affect you at the consumer level?
LISOVICZ: Well, it should be a seamless transaction. I think you know the fact that it's going to be kept as a whole, the whole company will be kept together I think is a little comforting. It's also nice to see something that's done without the government's intervention.
COLLINS: Yes.
LISOVICZ: This is the way things used to happen on Wall Street. We didn't have the Treasury Department and the Federal Reserve involved in every single deal here.
COLLINS: Yes. Good point. All right. CNN's Susan Lisovicz at the New York Stock Exchange. We'll be watching those numbers closely again today. Thank you, Susan.
LISOVICZ: You're welcome.
COLLINS: Now to the much anticipated vice presidential debate. Sarah Palin, Joe Biden faced off last night for their one and only debate. Each took shots at the top of the other ticket. Here is what some of what they had to say on foreign affairs.
(BEGIN VIDEO CLIP)
SEN. JOE BIDEN (D), VICE PRESIDENTIAL CANDIDATE: The past is prolong. The issue is how different is John McCain's policy going to be than George Bush's? I haven't heard anything yet. I haven't heard how his policies can be different on Iran than George Bush's. I haven't heard how his policy is going to be different with Israel than George Bush's. I haven't heard how his policy in Afghanistan is going to be different than George Bush's. I haven't heard how his policy in Pakistan is going to be different than George Bush's. It may be, but so far it is the same as George Bush's. And you know where that policy has taken us.
GOV. SARAH PALIN (R), VICE PRESIDENTIAL CANDIDATE: The surge principles, not the exact strategy, but the surge principles that have worked in Iraq need to be implemented in Afghanistan also. And that perhaps would be a difference with the Bush administration. Now Barack Obama had said that how we're doing in Afghanistan is air raiding villages and killing civilians, and such a reckless, reckless comment, an untrue comment again hurts our cause. That's not what we're doing there. We're fighting terrorists and we're securing democracy.
(END VIDEO CLIP)
COLLINS: Well, of course, that's just a small part of what they said. But how did they do? Here is a take. In a new CNN opinion research corporation poll that was taken right after the debate, we asked a group of debate watchers evenly divided between political parties. 51 percent said they thought Joe Biden did a better job in the debates. 36 percent chose Sarah Palin.
A one-shot deal. The debate was the only chance for voters to see the vice presidential candidates face to face on the national stage. But did they connect with those voters? CNN's Dana Bash is live in St. Louis for this us this morning.
Dana, did Sarah Palin help herself last night? Did she help Senator John McCain? What's the take on it all?
DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: You know I think that the reality is, Heidi, that she helped John McCain in that she didn't do him anymore harm. I think probably that is the best way to describe what happened last night. There have been a lot of Republicans who were quite worried and concerned about last night. I'll give you just a little bit of an anecdote about where the expectations were here.
I got an e-mail from a Republican strategist about 30 minutes in who was absolutely elated with at that point with her performance. At the end of the e-mail it said as long as she doesn't turn to the camera and say "live from Saturday Night, live from New York, it's Saturday Night," we're fine.
COLLINS: Oh, geez.
BASH: That just sort of gives you - that just sort of gives you kind of a sense of where the expectations were. There were sort of subterranean.
But here is the bottom line. If you listen to this debate and I think our polls really reflect this, Joe Biden was specific. He answered the questions that were asked of him. He tried to use the fact that he's a scrappy kid from Scranton which we've heard many, many times, to do what Sarah Palin was trying to do which was connect with people, say it's not just a number you know on a tally sheet. The economic problems, it is real. I understand it. I go to Home Depot.
Sarah Palin you know did the same thing. She winked a lot. She used kind of colloquialisms that really helped her connect saying you know darn right and you know I understand what it's like not to have health care. So on that level they both tried to really go at the same thing. But with regard to specifics, I just wrote one thing down here that I think was emblematic of the way Sarah Palin clearly had practiced just to kind of pivot away from things she didn't necessarily feel comfortable answering.
Gwen Ifill asked what would you give up? The same question asked of the presidential candidates. What would you give up on your plan given the economic crisis? Joe Biden was very specific. He said you know what, we probably wouldn't be able to give as much in foreign assistance. Sarah Palin said you know what I want to talk about energy policy, an area that is much more of her comfort zone than all else.
So I think at the end of the day, you know it's kind of politically stop the bleeding, that is a term I've heard over and over again this morning from Republicans. I think that's probably fair. But the other thing is, everybody is already looking beyond last night and looking at what happened this morning and the reality is, that the economy is still front and center, another morning of job loss. That is what the McCain campaign is really, really worried about this morning. Heidi.
COLLINS: Everyone probably worried about that. All right. Dana Bash live from St. Louis this morning.
Thank you, Dana.
BASH: Thank you.
COLLINS: Yesterday we asked you if you thought the debate would impact the November election. And now after seeing last night's debate, do you think it will affect the election? Maybe your mind has changed. Send your e-mails to cnnnewsroom@CNN.com. We're going to be bringing some of them a little bit later in the show.
Feeling the pain of the housing crunch, not just the buyers and sellers, but the installers, too.
(COMMERCIAL BREAK)
COLLINS: Let's got ahead and listen in to some of what happened inside the House already today.
(JOINED IN PROGRESS)
REP. ADAM PUTNAM (R), FLORIDA: ... they haven't been able to borrow money in three weeks. The state of California is also reporting that they are having trouble accessing credit because the markets have frozen. This is something our members take very seriously and are continuing to work through these issues to find the best possible public policy for our people. A leader on this issue has been our Republican leader, John Boehner.
REP. JOHN BOEHNER (R), MINORITY LEADER: I think most Americans understand we're facing a serious economic crisis. And I think over the past few days, it's been clear the House Republicans have stood on principle and we've made this bill better. It's a perfect no. But it clearly is better than it was a week ago. And whether it was us standing up at the White House to a lot of pressure to pass the original Paulson plan or even after Monday, even though I wanted my colleagues to support the bill, it didn't pass. And the bill has gotten better as a result.
And I just believe that I'm optimistic about today. We're not going to take anything for granted. We're going to continue to talk to our members. But it's time to act. It's time to act on behalf of the American people, it's about their savings, it's about their jobs, it's about their retirement security. And we, as members of Congress, have a responsibility to do everything we can to protect the American economy and to protect our constituents.
REP. ROY BLUNT (R), MINORITY WHIP: Well, three important things have happened since Monday. One is that calls to members' district offices have began to even out where you have as many people beginning to recognize this has impact on their pension plan, this has impact on their retirement plan, their IRA. This has impact maybe even on credit at the bank, we're hearing more and more all across the country, in spotted areas. But that's a problem that can continue to grow. The second thing that happened was that the S.E.C. took some significant action that we had hoped for regarding how you value assets in the marketplace. The 45-day study that's in the bill actually makes even more sense now because we'll be doing a 45-day study of this topic if the bill passes to see what difference these new accounting standards make.
And the third thing are the important additions to the bill itself. The FDIC insurance coverage plus the addition of tax legislation that almost all of our members would be supporting if it was standing alone. So we're optimistic as we go to the floor today, we're not going the talk about any numbers yet. But we'll be continuing to talk to our members as the hour and a half, two hours of debate goes on, and we're moving forward with the bill. Eric.
REP. ERIC CANTOR (R), VIRGINIA: As the leaders have said, I think our focus from the very beginning on this has been to try and protect the taxpayers, to try and lessen the burden on them as we insist that Wall Street shares in paying for the cost of cleaning up this mess. And it is with that perspective I think our members will go to the floor today knowing that we did make this bill better, we tried to refocus this bill and tried to limit the exposure to the taxpayers.
Bearing in mind, the middle class of this country that frankly are beginning to see now the impact of the credit crisis on their 401(k) plans, on their IRA plans, on their 529 college savings plans. These are real matters to people. And they're trying to get their arms around the challenges that they're going to face over the next several months because of this crisis. And I'm hopeful that today marks a day that we can begin now to focus on how we continue to ease the situation with so many families across this country.
UNIDENTIFIED MALE: Mr. Blunt, you said you're going to be working on the next hour or so - that tells me that maybe everything has been lightened?
BLUNT: We're going to continue to talk to our members. We feel good about the direction we're headed. Right now we got a rule vote. And actually there may be a few of us that might have to help on this rule. So I'm going to go over and be a part of that. Thank you.
COLLINS: All right. Just to give you an idea of what exactly we just saw there. Several Republicans coming to the microphones after they were holding a closed-door caucus meeting, if you will, of course regarding the financial bailout bill which is in front of the House, likely to be in front of the House for the vote today.
We want to give you also an idea of that little itty bitty box that you see there and what you're looking at. This is the vote that's taking place on the rules for the debate. So that's usually about a 15-minute process or so. And once again, all of that handled and they will move on to the debate regarding a particular bailout bill that as you know by now has passed in the Senate. And we're waiting for that vote in the House to take place sometime today. So once again, we have our eyes closely trained on all of those things for you today.
Meanwhile, the credit crisis and the lengthy slump in the housing market, a one-two financial punch for millions of people in the industry. We're not just talking about realtors. Plumbers, electricians and heating and air people all feeling the pain. CNN's Rusty Dornin is at a convention of housing service companies happening right here in Atlanta, happening every year and wants to tell us a little bit more about what people are saying there.
I'm sure it's the talk of this convention that what, it's only been open for a few minutes, right, Rusty?
RUSTY DORNIN, CNN CORRESPONDENT: Well, actually this is the last day. And I think Heidi, it's very key to understand that there were 10,000 people at this convention last year for this international trade show. Only 5,000 showed up this year which shows you the state of the economy. And only, they figure, about 3,000 showed up because of the problems we've had in Atlanta with the gas shortage. So really, this convention has been hit hard.
Now, we are talking here. We want to talk to somebody who can tell us really what's been happening in his business. Kip Ivey is a software consultant for the construction industry.
You were just saying, Kip, in the last couple of weeks even, your clients have been feeling a credit crunch from what's going on?
KIP IVEY, SOFTWARE CONSULTANT: Without question. Coming from sales, coming into the last end of the quarter which is just the beginning of this week, we had a number of clients who said look we're not just ready to push forward right now until we see what's happening in our credit situation that we're in. We're going to hold off.
DORNIN: What do you say, as you can see on the TV right here now we have what the Congress is debating, this bailout bill. What do you think of this? Do you think this is going to ease people's minds, ease the credit crunch? Is it going to help the people in your industry?
IVEY: Well, I think right now I think there's culpability on both sides of the aisle. Is this a hard pill to swallow for any taxpayer? I don't think it's a question. I think it's a question of it's something we have to do. We've got to do something to spur interest in our economy again, to give some type of personal responsibility back to say, look, we need to do something to move forward. So am I 100 percent in agreement with it? No. Do I think it's something we need to do? Without question. I think it's going to help. I really do.
DORNIN: I mean, you were saying you're in sales and people are very nervous. Do you think this bill in the immediate future is going to help you, help your clients feel more comfortable to be able to pursue what they need to buy for their industry?
IVEY: I think so. I think so. I think like I said, I think it's a matter of bringing in some confidence that something is being done rather than sitting back and let you know winds blow. So I think there's a lot of question. I think you know there's hope, when I talk to a lot of my other compatriots downstairs, there's hope that something is going to happen and that things are going to relax. I mean this show is a prime example of where things stand right now currently in our economy.
DORNIN: OK. Great. Kip Ivey, thank you so much for joining us. A lot of people here just keeping their fingers crossed that this bill does that. Most people I've talked to are not really happy with it. But they certainly are very nervous if it doesn't pass. Heidi.
COLLINS: Yes. We seem to be hearing an awful lot of that. Rusty Dornin. We sure do appreciate it. Thanks.
He doesn't play a doctor on TV. If this actor was a real patient. And what he learned could save your life.
(COMMERCIAL BREAK)
COLLINS: When actor Evan Handler learned he had leukemia, he had no idea he was about to become an "Empowered Patient." For him taking charge of his medical care was a matter of medical survivor.
Medical correspondent Elizabeth Cohen has the story.
(BEGIN VIDEOTAPE)
ELIZABETH COHEN, CNN MEDICAL CORRESPONDENT: For fans of "Sex in the City," Evan Handler is Harry Goldenblatt.
EVAN HANDLER, ACTOR PLAYING HARRY GOLDENBLATT, "SEX IN THE CITY": Charlotte York, will you marry me?
COHEN: What people don't know is along with acting, Handler has another passion, patient empowerment. For him it's personal. When he was 24, Handler was diagnosed with leukemia. Doctors told him he would likely die. Handler believes he's alive today because of some truly excellent doctors, but also because he was a royal pain in the neck.
HANDLER: I was considered to be difficult and I was pretty rigorous about checking everything all the time.
COHEN: For example, once he looked at his I.V. bag and noticed another patient's name.
HANDLER: So I rang the call bell for the nurse and got a very common response of, what is it, Evan, we're on a lunch break. Actually, well the drug running into my vein has someone else's name on it. And there was a pause, and they said someone will be right there.
COHEN: And he says this was just the beginning. Infections were allowed to fester. Safety precautions were ignored. So what are his tips for dealing with an imperfect health care system? Handler's first words of advice, when you're seriously ill bring someone with you to the doctor's office or hospital.
HANDLER: It's really, really tough to keep your eye on everything by yourself.
COHEN: Also read about the drugs you're taking and don't be afraid to speak up.
HANDLER: Question whether it's the best drug for the condition.
COHEN: Now more than 20 years later, Handler is cancer free and writes books about what happened to him.
HANDLER: You go in this room here!
COHEN: And uses his celebrity to tell his story.
HANDLER: I think it's horrendous that some of the things that happened to me happened, and I'd like them not to happen to others.
COHEN: Elizabeth Cohen, CNN, New York.
(END VIDEOTAPE)
COLLINS: Uncle Sam extended a helping hand to failing financial houses. Could a state be next in line?
(COMMERCIAL BREAK)
COLLINS: Happening right now, House members are getting ready to revote on a rescue plan for Wall Street. When they rejected the original $700 billion bill on Monday, the Senate revised it. And now what we're waiting for is the new House vote. What you're seeing on your screen right now in this live shot is just the procedural vote at this point and they were going to have the debate about the actual bailout bill and then the vote on that new version.
So, here is what else is going on. Employers sharpen the ax in September cutting 159, 000 jobs. That's the most in more than five years.
Wachovia ditches a potential deal with Citibank to merge with California banking giant Wells Fargo, because they offered more money. And California Governor Arnold Schwarzenegger warns the Treasury secretary his state might need a $7 billion loan.
Checking in on Wall Street now. Look at those numbers. Triple- digit gains, Dow Jones industrial average up 157 points, Nasdaq up about 44 points, as well. And I believe the S&P is coming up down there, yes, 24 points to the positive, too. Watching all the numbers for you.
Let's talk more about that possible plan in California. Governor Arnold Schwarzenegger blames California's cash shortfall on the current credit crunch. More now from Cornell Bernard, with our affiliate KXTV.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE (voice over): California got some sobering news from its lenders.
UNIDENTIFIED MALE: We were told you would not have been able to engage in a short-term borrowing had you tried.
UNIDENTIFIED MALE: Tom Dressler speaks for his boss, Treasurer Bill Locklear, who says the state could go broke if the economic crisis isn't dealt with.
If the current conditions don't improve to the point where we can access the credit markets, at the end of the month, beginning of November, the state's ability to provide these services uninterrupted is jeopardized.
UNIDENTIFIED MALE: California typically borrows short-term loans during the fall to cover expenses until income tax revenues are received in April. But the state and local governments are being shut out of credit markets due to economic turmoil.
GOV. ARNOLD SCHWARZENEGGER, (R) CALIFORNIA: We want to urge the legislators in Washington, Democrats and Republicans, to get together and to put aside all the politics and to think about the people of this great nation.
UNIDENTIFIED MALE: If cash reserves are exhausted, payments for teacher's salaries, law enforcement and every other state funded service could stop. California cities could also face the same thing.
UNIDENTIFIED FEMALE: They need to put the politics aside.
UNIDENTIFIED MALE: Sacramento County employee Kim West fears a worst-case scenario.
UNIDENTIFIED MALE: (on camera): How would you feel if this eventually affected your paycheck?
UNIDENTIFIED FEMALE: Oh, it will. I will be very upset. I'm upset now because, I'm getting the indirect effects of it. I would not be able to afford my home. I would not be able to provide for my family.
(END VIDEOTAPE)
COLLINS: Quickly want to show you one more time what we're looking at out of Capitol Hill, right now, as we await the actual vote on the Senate's version that passed Monday. This is not the actual vote. I want to be entirely clear here. What you're looking at is a series of procedural votes that have to take place in order to put the rules in place for the debate that will follow.
So, we know that one of them is passed. This is another quick little procedural vote going to be taking about five minutes, we understand. Then the debate will happen. And then after that, that's going to last about 90 minutes, we understand. After that will be the actual vote on the Senate version, as I said, that passed earlier in the week. That big vote not happening right quite yet. But certainly steps leading toward it. >
Issue #1, the economy. With home values and 401(k)s shrinking, fears are certainly growing especially among Americans who want to retire, but now cannot. Here is CNN's Mary Snow.
(BEGIN VIDEOTAPE)
MARY SNOW, CNN CORRESPONDENT: Kristine and Mike Digiovanni are on the front lines of the financial crisis. They say it's a scary place to be. Both are looking for work. Christine just turned 60 but said any hopes of retiring soon are gone.
KRISTINE DIGIOVANNI, INVESTOR: We were looking maybe 62 would be a good age. Now it's like -- retirement? What retirement? It's just not going to happen.
SNOW: Kristine says her 401(k) is now worth what it was 15 years ago when she started investing in it. She estimates she lost about $50,000 so far this year, until she recently took her money out of stocks and switched to bonds.
K. DIGIOVANNI: Every quarter I'd get a statement. It would be $2,000 or $3,000 less than it was the quarter before.
SNOW: The couple's main investment is in real estate an includes their Madera Beach, Florida, home. That has lost a third of its value. The Digiovannis say they can't afford anymore repair work.
Across the country in Nevada, the real estate downturn has also hurt 43-year-old Catherine Lindsay, but not as much as the plunge in her 401(k) savings. She estimates her 401(k) lost 60 percent of its value this year.
CATHERINE LINDSAY, INVESTOR: I made a choice to invest in some risky stocks, or things that might be considered risky now.
SNOW: Financial planner Constance Barber says her clients haven't seen such dramatic drops. But she has them balance their investments in cash, bonds and stocks.
CONSTANCE BARBER, FINANCIAL PLANNER: If you are a 40-year-old and your account is down 20 percent, then you can afford to wit wait it out since it's a retirement account. If you're 65 or 70, you shouldn't be 100 percent in stocks.
SNOW: Barbara is advising her older clients to work as long as possible. For Catherine Lindsay that's something she's already banking on.
LINDSAY: If I'm going to continue this, I also have to accept the fact that I'm probably going to be working until I'm in my mid 70s.
SNOW (on camera): One investment research group, Morningstar, says judging from the past it could take investors three years or more to recover from a downturn like this one.
Mary Snow, CNN, New York.
(END VIDEOTAPE)
COLLINS: The Department of Energy has announced applications from energy companies trying to get loan guarantees to build 21 new nuclear plants. But as the credit crunch puts the squeeze on businesses of all types, what will it mean for those plans?
CNNMoney.com's Diane King has our "Energy Fix" now, from New York.
Good morning to you, Diane.
DIANE KING, CNNMONEY.COM: Good morning, Heidi.
Well, here's how it breaks down. To build 21 new nuclear plants, it will cost $188 billion. The companies say they needed $122 billion in loan guarantees from the Department of Energy. But the DOE says only $18.5 billion is available. So, of course, there is a shortfall.
One company applying for these guarantees, Duke Energy, tells us it does not have plans for a new nuclear plant but is just keeping the option open.
How will the locked up credit marked play into this? We talked to the Nuclear Energy Institute. It says the review process for the plants will take three to four years. If credit is still a problem at that point, we'll have bigger problems than not having enough energy - Heidi?
COLLINS: Obviously that's not the only obstacle in the building these plants though, right?
KING: That's right. Nuclear plants have always been controversial. But they're becoming more accepted. Both of the presidential candidates include nuclear power in their energy policy. Although McCain's policy is more aggressive in adding nuclear power. The good news about this type of power is it emits zero greenhouse gases. Once they're built, it is a cheap reliable source of energy.
The bad news, though, disposing of nuclear waste is a major concern. It can be recycled. But the byproduct of that has been weapons grade plutonium, so a major security issue there. Plus, there is always the risk of an accident, which means most local communities don't want a nuclear plant in their back yard. CNNMoney.com is following the energy fix story and the credit crunch. Log onto our Web site for all of the latest news.
Heidi, back to you.
COLLINS: Thanks so much, Diane. Appreciate that.
Carrier make over, one-time warship, now a souped up museum "The Intrepid" returns to its New York pier all fixed up.
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COLLINS: Home, sweet home. The famous World War II aircraft carrier Intrepid is now back here. You see a live shot there in New York's Pier 86, after getting a two-year-long facelift. A museum dedicated to this historic ship is scheduled to reopen next month. Bill White is joining us now live from New York, he is the president of the Intrepid Sea, Air and Space Museum. And also the co-author of this, the book, called the "Intrepid: The Epic Story of America's Most Legendary Warship."
So, Bill, first thing I want to say to you is, congratulations, not only on the book but on getting this thing back in place.
BILL WHITE, PRESIDENT, INTREPID SEA, AIR, SPACE MUSEUM: Thanks so much, Heidi.
First things first, I want to tell you something. Yesterday as we were coming up the Hudson River, 400 former Intrepid crew members, men that served on the ship in World War II, you know through five kamikaze attacks, flew in from all over the country; 70 and 80 years old, at their own expense to be on the Intrepid. They want to tell you they love you, that they love you and they missed you yesterday. Things were busy with the debates and all that stuff, but they wanted me to tell you hello, because you were there when we moved, and we were able to get back in with your spirit, and not get stuck in the mud again.
COLLINS: Yes. I wasn't going to bring up the mud, but now that you have, obviously a much smoother trip as we're looking at some of that video right now, getting back in place. You know, this is what the story is really about. You're talking about the veterans and those who served on that ship. The reason it's about them is because of their service. They can bring to the rest of America an appreciation for that.
WHITE: Yes, that's true, Heidi. You hit it right on the nail. The story about the Intrepid is not so much about the aircraft carrier itself. It's so impressive. Coming down and visiting the Intrepid we are going to have probably have over a million paid visitors come down and revisit the ship when we reopen on November 8th. It will take us about 30 days or so to get the ship all shipshape, for our future visitors.
One of the big things is honor, education, inspiration. Those guys that saved that ship are here for a lesson for America. You know, whether you're for the war or against the war has nothing to do with the "Intrepid." We're about honoring our troops and loving them. That's what the book is about, too. It's not about the author, Bob Gant, who was a fighter pilot in Vietnam, did this as a labor of love. It's really the story of how this ship embodies what's great about America, and what we have to teach our children.
COLLINS: As we're looking at this right now, because it is gorgeous, and we know there was a whole lot of money put into this incredible renovation, what are the big changes? What is everybody going to see?
WHITE: Oh, my gosh, I have to tell you, it's a whole brand new museum. We took the ship out of the water, gave her a $5 million paint job, you know, 7,000 gallons of Navy battle gray paint, she has a brand new aircraft collection. We spent about $10 million or $15 million on the exhibit restoration. So, you know all the whiz-bang simulators, lights and sound. There's a Exploratorium, for kids to go and climb and touch and get interactive reaction about learning about the ideals that this guys embodied.
It's not about the guns and bullets. It's about how 3,000 men, at the time, now it is men and women who serve in the military on these carriers, come together as a team and serve for a greater cause than themselves. Also, we actually have a brand new pier, a 1,000-foot pier where people can come, and it's public access, you don't have to pay to come down to the pier. It's beautiful on the Hudson River. You'll love it.
COLLINS: It's going to be great. We're looking forward to that when it opens to the public, November 8th, correct?
WHITE: Absolutely. I encourage everybody to go to our Web site at IntrepidMuseum.org, because that is where they can see about all the schedules. They can also pick up a copy of the book, 100 percent of the proceeds go to the Intrepid. I feel terrible, I feel like a book pimp. But it's about supporting the troops. All that money will go into making sure we can continue this important mission.
COLLINS: It's a great read, too. You see it once again, the book there by Bill White and Robert Gant.
Bill, thanks so much. You're the man who gets it done. Maybe we should send you to Washington, right now, with this bailout bill.
WHITE: Heidi, thank you.
COLLINS: Sure do appreciate it. The president of the Intrepid.
Meanwhile, as we say we've had our eye trained very closely on Washington. We see Charlie Rangel, there, in front of the podium. Because, right now we are understand the debate has begun, on the most current version of the bailout plan. Let's listen for just a moment.
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REP. CHARLES RANGEL, (D) NEW YORK: ... Free market system. That government and regulations will strangle our economy. The fact is that in such a short period of time, had it not been for Barney Frank and people on the other side of the aisle, in trying to do the best we can, we leave here with heavy conscience that, if we do nothing, then the sacrifice will be felt by employees, at thrift accounts, at savings accounts, small businesses. So in a sense we have a political gun at our heads. That we can't afford to say that we know better, and so most of us have agreed that Secretary Paulson, and economists, have given us fair warning.
Now, that's enough and it's complicated enough. But then we have had the threat of tax bills that expire at the end of the year, companies that have relied on tax credits, individuals, who relied on it, expire. And four times we sent energy bills to the other body, and four times they ignored it. Included in these bills, of course, has always been -- the House is not in order.
NANCY PELOSI, (D-CA), SPEAKER OF THE HOUSE: That is correct. Members in staff in the rear of the chamber, will remove their conversations in from the floor. Members pursuing conversations will remove their conversations from the floor.
Gentleman from New York?
RANGEL: Thank you, Madam Speaker.
Included in the bill sent over by the body has been disaster relief, and all of us believe these people should get it; mental health parity which god knows all of us with any sensitivity recognize this inequity has to be taken care of. And of course, the alternative minimum tax that no member in this House or the other body can ever explain to taxpayers there's over $60 billion burden should fall on their shoulders because the Congress didn't think far enough ahead in order to adjust this tax for inflation.
So in a sense, Madam Speaker, we're being told the burden would fall on 25 million people by the Senate, by our constituents, and the country and entire world, by the administration if we don't have this $700 billion rescue bill. And I just hope and pray that some time historically we might be able to regain the power that we used to have in the House, introduce bills, have hearings and fully understand what we're doing rather than having to yield to the threat of disaster whether it's fiscal, or whether it's tax liability.
So I reserve the balance of my time, Madam Speaker, but I see John Tanner walking on the floor and I do want to say he's an outstanding member of our committee. He's been talking about the deficit for a long time. And his contribution to this package I'd like to point out has made him a proud member of our committee and the Congress.
I yield back - I yield to myself the balance of the time.
PELOSI: And the gentleman reserves his time.
Gentleman from Louisiana.
UNIDENTIFIED MALE: Madam Speaker, I yield myself so much time as I can consume. It won't be much.
PELOSI: The gentleman from Louisiana is recognized.
UNIDENTIFIED MALE: Madam Speaker, a little over 20 years ago I made my first speech on the floor of the House of Representatives. Today could very well could be my last speech on the floor of the House. I hope it's not. I hope we come back in a lame duck session to consider pending trade legislation. But this could be my last speech.
And I had a real stem winder prepared, Madam Speaker. But unfortunately we only have 15 minutes of time that Weighs and Means controls. I have many more speakers than I have time. So with the speaker's indulgence, I will submit my remarks for the record, and yield three minutes to the distinguished minority whip, Mr. Blunt.
PELOSI: The gentleman from Missouri is recognized for three minutes.
REP. ROY BLUNT, (R) MINORITY WHIP: I thank the gentleman for yielding, Madam Speaker. I'm glad we're here at this work today. I do think the bill has improved and the situation has -- is clarified from Monday. We need to come together. We need to get this work done. It's incredibly important.
It seems to me that two significant things have happened. One, the changes in the bill that others will talk about and I'll talk about a little bit. And, two, the changes at the Securities and Exchange Commission and the Accounting Standards Board, that have set forth a new way to evaluate these assets that are causing so much trouble in the marketplace.
Now, where I live nobody talks about illiquid assets. They talk about mortgages, they talk about how to pay the bills. They talk about whether they can borrow money or not, and at the end of the day, Madam Speaker, that's what this bill is about. It's not about Wall Street. It's about Main Street. It's not a bailout. It's a situation where American taxpayers are going to invest money in a way that ensures they have a return.
I think with the work we've done here, we've not only insured that they're likely. There's never likely to be a question of return, but beyond that if, at the end of five years, taxpayers would appear have lost any money, the president will propose and Congress will act on a set of recommendations that go back to the agencies that participated and say, we're going to recover whatever was lost. This is a chance where American taxpayers are investing in their own future.
This is an opportunity where people are helping stabilize a market. We saw a bank purchase this week, where it looked like the government would have to be part of the purchase. But after the government came in and said here's how we're going to work to stabilize the situation, suddenly there's a market. And suddenly that purchase is much different than it would have been without government participation. This bill allows that kind of stabilization. This bill protects taxpayers. This bill has every known oversight mechanism ever conceived of by government in it now.
None of those were asked for, initially, by the administration. But they're all there now. A special I.D., a board that sets -- a special inspector, a board that sets policy, a congressional oversight group, GAO, with special authority, ultimate transparency. This is a bill the taxpayers can look at and say this is well beyond the proposal that came to the Congress. It has the transparency, it has the oversight.
It has the guarantees that taxpayers should ask for: it also has lots of options, options that weren't in the original proposal, not just to loan money, not just to purchase mortgages, and other securities, but to set up an insurance plan. So if that's one of the things that would make more sense in certain areas, it can be used. It's a critical moment -- can I have 30 more seconds?
PELOSI: Gentleman is recognized for 30 seconds.
BLUNT: It's a critical moment, and I would like to put in the record, Madam Speaker, a letter I received from the Secretary of Treasury, talking about the rules and regulations that they will pursue, that will assure eligible financial institutions must be established and regulated to have significant operations in the United States.
It's not talking about foreign banks. Also requiring that, in the letter, they'll set up rules and regulations so that people participating in this program won't benefit from this program.
Madam Speaker, I submit that letter and yield back.
PELOSI: No objection. And the gentleman yields back.
The gentleman from New York is recognized.
RANGEL: Madam Speaker, I ask unanimous consent that I be allowed to say farewell to my friend Jim McCrary without having attribute it to the allotted time.
UNIDENTIFIED FEMALE: No objection.
PELOSI: No objections, so ordered.
RANGEL: I had no idea that we'd be coming back here and I would have this opportunity. But for some of us being members of Congress, and especially members of the Ways and Means Committee, it has been a special privilege. This historic committee, however, has had its ups and downs with partisanship, the likes of which we had not seen on the committee or in the House of Representatives.
I hardly knew Jim McCrary during the years he was on the committee, because the other side was dominated by one personality. But as soon as things changed and I had the opportunity to meet and talk with him, as the ranking member, I not only found a scholar and a gentleman, but I found someone who loved his country and Congress more than he loved the partisanship.
It wasn't as though we were able to resolve many of the crises that exist in our committee, but the one thing that he did do, and it will continue after he leaves us, is to create a climate where we had a degree of respect for each other, and especially when we need that respect when we disagreed and our parties disagreed. His legacy, even though he leaves, will continue to know that in this House, no matter how frightened (ph) we are politically, we still can be civil, we still can get things done, and even when we're not successful, we can work in such a manner that other people who follow us would know that we can be - we can disagree without being disagreeable.
So, Jim, I speak for all of the Democrats -
COLLINS: There you have Representative Charlie Rangel there actually saying good-bye to one of his colleagues. He asked for special permission to do that, because he didn't want to take up time out of the debate, which is actually taking place right now on the House floor as well. So that debate, we understand, is going to be about 90 minutes long. Then the vote could come as early as 12:30 or so. Again, that could change. We're just giving you a little time frame there. Once again, voting on the Senate version that passed, and now the House is trying to get it passed as well.
Continue watching everybody. I'm Heidi Collins. You can join me again Monday morning starting at 9:00 a.m., Eastern. Have a great weekend.
For now, CNN NEWSROOM continues with Tony Harris.
