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American Morning
Plan to Help Homeowners; Union Looking for a Loan, Not Bailout; Team of Rivals Fill Obama Cabinet; Congresswoman Hangs Up on the President-elect; Pirates Target Cruise Ships; WMD Threat Likely Within Five Years?
Aired December 04, 2008 - 07:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KIRAN CHETRY, CNN ANCHOR: Meanwhile, we're coming up on 7:00 here in New York. A look at the top stories this morning. In Washington, the bleak outlook for an auto industry bailout. In just a few hours, the CEOs of Ford, GM and Chrysler will head to Capitol Hill and beg for $34 billion of your tax dollars. But Senate Majority leader Harry Reid says that the votes to pass the bill just aren't there. GM and Chrysler say they could collapse in weeks without the cash.
After some stern words for the U.S. on Election Day, Russian President Dmitry Medvedev says he, quote, "He is moderately optimistic that relations between Moscow and Washington will improve." Tensions have been strained over the president's plans to put a missile defense site in eastern Europe over Moscow's war with neighboring Georgia as well.
Well, he's been known as New York's governor and then client number nine. Now, Eliot Spitzer can add columnist to the list. Emerging for the first time since his resignation for ties to a high-end prostitute service, Spitzer is writing for the online magazine "Slate" and his first article argues against any Washington bailout.
Well, our top story this hour and what could be some much needed relief for homeowners struggling with mortgage payments. How about a mortgage rate of 4.5 percent, 30 years locked in fixed?
Well, right now the Treasury Department is batting around a plan that maybe could do that. It's all aimed at breathing life back into the battered real estate market, and the story is brand new this morning.
CNN's Christine Romans is "Minding Your Business" with more on how this proposal would work and exactly what might help.
Hey, Christine.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Who might it help? Anybody who's looking into getting a new mortgage for 4.5 percent, or somebody who wants to refinance their mortgage. The idea here to drive down mortgage rates to spark activity in the housing market.
There is no official comment from the government on this. I want to be very clear about that, but industry sources are talking about a plan that the treasury is discussing, a plan that the treasury has been thinking about to use the way the Fannie Mae and Freddie to push down mortgage rates to about 4.5 percent, maybe by even going in and buying mortgage backed securities to help drive those rates down. But the Fed last week, the Federal Reserve said it was going to buy up a whole bunch of these mortgage-backed securities and, in fact, you did see mortgage rates fall. If you look, they fell pretty substantially to 5.47 percent. And even during a holiday week, you saw a bunch of mortgage applications. And many of these applications were for refinancing. So we know that that rate falling to 5.47 percent did spark a whole lot of activity.
Who does it help? A first time homebuyer who is maybe concerned about things and isn't stepping into the market right now but at 4.5 percent would be interested. That homebuyer has to have good credit and actually have a job.
Who doesn't it help? It helps somebody who's already in default. It helps somebody who has just lost a job and doesn't have income. It does help people who are looking to refinance, and that would put money back into the economy.
But let's be very clear. This is about generating activity in the housing market. If indeed it does happen, it's about generating activity in the housing market. It would not be a lifeline for people who are at risk for foreclosure.
This does not address the foreclosure crisis on the ground, and that's something you saw in Deb Feyerick's piece that it's a part of the whole -- the whole financial rescue that is still been missing here, addressing this on the ground. But it does generate some activity in the housing market and that's something that the industry is very, very key for because, of course, that means it can write more mortgages and get more fees and it would be activity for the banking sector. So --
CHETRY: As long as the people they give it to can pay back this time, right?
ROMANS: That's right. I mean, that's absolutely right.
CHETRY: All right. Christine, thanks.
JOHN ROBERTS, CNN ANCHOR: Coming hat in hand and they got there on hybrids this time instead of private jets. The three men in charge of the American auto industry will be back on Capitol Hill in just a few hours making one final plea for now, $34 billion in taxpayer-funded life support.
General Motors says it needs $4 billion this month just so that it won't go broke. This comes as the union decides to give back a little bit so that workers don't lose everything.
(BEGIN VIDEO CLIP)
RON GETTELFINGER, PRESIDENT, UNITED AUTO WORKERS: We've always said main street, side street and rural America are all impacted by what the Congress of the United States does. And after all, we're asking for a loan here -- a loan to be repaid. We're not asking for that famous term that everybody use. (END VIDEO CLIP)
ROBERTS: Bailout is that famous term that he was looking for. CNN's Brianna Keilar is live for us on Capitol Hill this morning.
Brianna, this is an industry nearly three million jobs tied to it in the overall big picture. Senate Majority Leader Harry Reid though, says he doesn't have the votes for a bailout, at least as part of that $700 billion bailout package. Is this a shot across the bow of recalcitrant senators to say hey, listen, you got to do this because an entire industry is at stake?
BRIANNA KEILAR, CNN CORRESPONDENT: Well, and that's specifically what Reid said, as you pointed out, John, is talking about carving out a piece of that $700 billion Wall Street rescue plan and pushing that in the form of low interest loans to the automakers. He admits he doesn't have the support there. But if you speak with his aides, they will tell you he's still very much committed to helping automakers. And there are some other plans out there for where to get the money from. But, of course, carving out that money from the TARP, as we call it, is the primary one favored by Democratic leadership in Senate.
Bottom line, this is going to be a very tough road. These automakers, the chiefs of the automakers coming here today, they're going to have to do nothing short of grovel. They're going to have to make up for that jet fiasco. They're going to have to make up, if they can, what a lot of Americans see as a poor performance before Congress a couple of weeks ago and they're really going to try today to sell those plans as they put out on Tuesday.
Six in ten Americans, according to our recent CNN/Opinion Research poll not on board with this at all, completely opposed to this bailout. So there's a whole lot of road to obviously be made here by automakers.
Can they do it? It's going to be really tough. But are there widespread calls here on Capitol Hill to completely scrap this plan or say that hey, it's not working? We're not hearing that yet, John.
ROBERTS: The president-elect spoke about the possibility of a bailout. Let's listen to what he said yesterday.
(BEGIN VIDEO CLIP)
BARACK OBAMA (D), PRESIDENT-ELECT: We should maintain a viable auto industry, but we should make sure that any government assistance that is provided is designed for a -- is based on realistic assessments of what the auto market is going to be.
(END VIDEO CLIP)
ROBERTS: Is this ultimately, Brianna, going to fall into his lap, particularly if they can't bring it to a vote?
KEILAR: Well, no doubt, it would be so much easier for Democrats to get this by a President Obama rather than President Bush. You know, Obama is saying that, you know, the automakers have been more serious about their plan here, John. They commended -- he commended their plans. But as you pointed out, two of the automakers, GM and Chrysler, saying they can't remain solvent if they don't get money immediately.
Nancy Pelosi saying bankruptcy is not an option. You know, so this point, the idea of Democrats throwing their arms up in the air and saying we're just going to have to wait. We're just going to have to wait. We, at least yet, are not hearing that, John.
ROBERTS: Brianna Keilar for us this morning on Capitol Hill. Brianna, thanks so much for that.
CHETRY: Well, with just 47 days until Barack Obama's inauguration, it looks a little bit more like if you ran against the president-elect you get a spot in his cabinet. And members of team Obama had some harsh things to say during the campaign. Let's listen.
(BEGIN VIDEO CLIP)
SEN. JOE BIDEN (D), VICE PRESIDENT-ELECT: This is no time for on the job training for this next president coming in.
SEN. HILLARY CLINTON (D), NEW YORK: Ronald Reagan and you talked about the ideas of the Republicans. I didn't talk about Ronald Reagan.
Shame on you, Barack Obama.
GOV. BILL RICHARDSON (D), NEW MEXICO: I've been in hostage negotiations that are a lot more civil than this.
(END VIDEO CLIP)
CHETRY: Special correspondent Frank Sesno is taking a hard look at this team of rivals as they love to call it. He's in Washington for us this morning.
And explain, you know Washington inside and out. How do you go from the rivalry and the things that are lodged back and forth during a campaign to the civility of working together in a cabinet?
FRANK SESNO, CNN SPECIAL CORRESPONDENT: Oh, you say never mind, I didn't mean it. You say that was just a campaign. That was then, this is now.
Actually, it's difficult in some places and in some cases, there was some really bad blood between Bill Richardson and Hillary Clinton when he abruptly threw his support behind Barack Obama. And remember he had been the energy secretary and the U.N. ambassador in Bill Clinton's administration. So, sometimes it's difficult. But I think that what we're seeing now is a very dramatic play by Barack Obama to bring what he considers to be the best and the brightest into the cabinet. It's a political calculation. It's a policy calculation, but it's also a calculation that the dimension of the challenge and the problems that he and this team are going to face.
CHETRY: Rivals that he's putting in his cabinet all in some way shape or form seem to fall a little bit further to the right than he does. I mean, remember when we were -- when the campaign was going on, the GOP line was, this is one of the most liberal senators. You know, Barack Obama, be afraid, be very afraid.
What happened to all the liberals, some are asking, because it doesn't look like a left cabinet?
SESNO: So far, the liberals are still on deck and there are some within the campaign or quoted as saying they are next. But in the -- with the Democratic strategists and long-time observers I've been talking to, including some of them late yesterday, what they're saying is this group that he has brought in is a group of centrists and pragmatists. From a political point of view, bringing these former candidates in is really a masterstroke, especially Hillary Clinton.
What one senior Democrat I talked to last night said is, you know, look at what happened to Jimmy Carter back in 1980 when he was challenged from within the party for reelection by Teddy Kennedy. It was devastating. He ultimately lost. And certainly by taking Hillary Clinton, bringing her to the team, Barack Obama could be looking far ahead.
I really don't think that that is what is motivating this decision right now. What's motivating these decisions and these decisions is the immense challenge and that's -- of these issues.
CHETRY: Right.
SESNO: You bring these towering people in. Look, when they walk into a room, whether it's in Washington or anywhere else in the country or around the world, what they bring with them are the votes they got in the presidential campaign and a certain presidential stature in their own right and that really is going to matter.
CHETRY: I want to ask you about Governor Bill Richardson, commerce secretary, probably taking on a whole new dimension when we talk about this financial crisis that we're in. What does he bring to the table for commerce?
SESNO: He brings a lot because he's well traveled. He's well known. He's Hispanic, speaks Spanish. And so as far as Latin America is concerned, he's going to have an ability to converse directly there.
He's got a reputation for talking to people on all sides of the divide. He's been to North Korea and to Iraq. He dealt with Saddam Hussein personally. Not that that's a big trade issue. Breaks the mold a little bit because often in commerce, presidents reach out and they bring people from private industry and that's not something that Richardson has. But given all the trade deals that are up in the air right now and some pressures to kind of look back inward, this is going to be a very interesting appointment indeed.
CHETRY: Frank Sesno, always great to talk to you and get your point of view. Thanks.
SESNO: Likewise. Talk to you soon.
CHETRY: It's 10 minutes after the hour.
Cruise ship alarm.
(BEGIN VIDEO CLIP)
WILL GEDDES, SECURITY SPECIALIST, ICP GROUP: That emits a very high, loud frequency that disrupts the pirates from coming close to the ship.
(END VIDEO CLIP)
CHETRY: Pirates taking on new targets. How passengers on vacation can still stay safe on the high seas.
You're watching the "Most News in the Morning."
(COMMERCIAL BREAK)
ROBERTS: Fourteen minutes after the hour. And here's a look at news across the nation.
Long Island, New York, the family of the Wal-Mart security guard trampled to death on Black Friday is suing, claiming that the store failed to control the surging crowds that were trying to get in. Wal- Mart says it is in contact with the family and has offered to do all it can to help.
A new protest against California's Proposition 8 which bans same-sex marriage. An all-star cast hits the web with a three-minute musical on funnyordie.com. It's written by Tony-award winner Marc Shaiman. He's the composer of "Hairspray" and "South Park," "Bigger, Longer & Uncut." The viral video includes Neil Patrick Harris, John C. Reilly, comedienne Margaret Cho, "SNL"'s Maya Rudolph and Jack Black as Jesus.
After giving Barack Obama a huge boost in the campaign trail, talk show titan Oprah Winfrey will bring her Chicago-based show to Washington for the entire week of the inauguration. Winfrey has rented out the Kennedy Center's Opera House for her show. So yes, it's Oprah at the opera.
And for a few of those in government, workers in Perry County, Alabama, next year has another holiday. A new measure passed will mark the second Monday in November as a holiday in honor of Barack Obama's victory. Mostly African-Americans live in the rural county which voted overwhelmingly for the president-elect last month.
CHETRY: Well if you pick up the phone and someone says he is Barack Obama and it's not a recording, what would you do? Well, this was the conundrum for one Florida congresswoman. It turns out she made a bad choice twice.
Robin Simmons of affiliate WSVN in Miami has the story.
(BEGIN VIDEOTAPE)
REP. ILEANA ROS-LEHTINEN (R), FLORIDA: Our radio stations, they make anybody jaded. I'll tell you. You an get the pope to call me and I'd say, oh, yes, klunk.
ROBIN SIMMONS, AFFILIATE CORRESPONDENT, WSVN (voice-over): Not the Pope but a pretty powerful man in his own right. President-elect Barack Obama has been busy during his transition process making announcements and lots of calls. One to South Florida Congresswoman Ileana Ros-Lehtinen.
ROS-LEHTINEN: He goes, "This is Barack Obama." And I said, no. You know, I'm sorry. I'm not going to be on the 8:00 a.m. radio news where you're punking me.
And he goes, "This is really Barack Obama," because he hears that I'm about to hang up. And I said, "I'm sorry. And he goes, "How can I -- how can I prove it to you?" I said I'm sorry. I'm not falling for it. Boom. Hang up.
SIMMONS: She's heard her share of prank calls on the radio like the one Miami DJs made to Fidel Castro.
VP nominee Sarah Palin was tricked a few weeks ago.
(BEGIN VIDEO CLIP)
GOV. SARAH PALIN (R), ALASKA: And you're just right. Oh, my goodness.
UNIDENTIFIED MALE: Do you know my wife, Carla, would love to meet you.
(END VIDEO CLIP)
SIMMONS: After the first hang up, Ros-Lehtinen gets a second call from a man saying he's Rahm Emanuel, a fellow colleague in the House who was recently named Obama's chief of staff getting the same treatment.
ROS-LEHTINEN: He says, you know, you've just hung up on the president, the next president of the United States. I said, look, and you're Rahm Emanuel. Sure.
SIMMONS: If at first you don't succeed try, try again. A third call to Ros-Lehtinen's mobile phone finally does the trick when another House colleague shares a personal story only the two of them know. It happened on the silver screen when a fictitious president surprised a lobbyist by phoning her unexpectedly.
(BEGIN VIDEO CLIP, "THE AMERICAN PRESIDENT" CASTLE ROCK ENTERTAINMENT/WARNER BROS.) UNIDENTIFIED FEMALE: I'm also impressed that you were able to get my phone number given the fact that I don't have a phone.
Goodnight, Richard.
UNIDENTIFIED MALE: Oh, this is --
(END VIDEO CLIP)
SIMMONS: So how did the real president-elect handled this situation?
ROS-LEHTINEN: He was having a good laugh. He said Michelle will get a kick out of it because she likes to -- she likes to pinch my ego and bring it down.
Trust me, Ileana, you will forever be remembered by me because I have made many of these calls. Never once has anybody hung up on me and never once has anybody hung up on me twice.
(END VIDEO CLIP)
CHETRY: She's a good sport about it because she agreed to talk about it. It's embarrassing. But I mean, it's funny.
ROBERTS: What do you think the personal story was?
CHETRY: Yes, exactly.
ROBERTS: Ooh, it is you.
(LAUGHTER)
CHETRY: That must mean I hung up on -- oops.
ROBERTS: Oops.
CHETRY: There you have it.
ROBERTS: How else can we screw up today?
Eighteen minutes now after the hour.
Reading, writing and selling?
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Didn't seem like a lot of money.
(END VIDEO CLIP)
ROBERTS: What's a sales pitch doing at the bottom of a science test? Selling ad space in school. The fundraiser that has some in a funk.
You're watching the "Most News in the Morning."
(COMMERCIAL BREAK) CHETRY: Welcome back to the "Most News in the Morning." Pirates off the Somali coast getting more and more daring after targeting a massive oil tanker now turning their sights on a luxury cruise ship. So what are companies doing to make sure your next cruise isn't hijacked?
Jason Carroll is investigating that for us this morning.
Hey, Jason.
JASON CARROLL, CNN CORRESPONDENT: You know a lot of these companies are really worried about these. These bandits are desperate, well organized and armed. It makes for a dangerous combination. Security experts say the international community has to do more to stop them.
(BEGIN VIDEOTAPE)
CARROLL (voice-over): Pirates latest target, the cruise ship MS Nautica. Bandits fired on the luxury liner. The captain outmaneuvered the attackers by revving the engines and speeding away.
UNIDENTIFIED FEMALE: The captain says they were suspicious. They're following us, but we're all just going to the corridors or into our cabins.
UNIDENTIFIED FEMALE: It was a surprise attack, you know.
UNIDENTIFIED MALE: Yes.
UNIDENTIFIED FEMALE: And they did fire shots (ph).
CARROLL: Security experts estimate bandits have attacked about 100 ships off the Somali coast this year, claimed millions in ransom, taken more than 200 hostages. Pirates say Somalia is so poor they will not stop.
UNIDENTIFIED MALE: We work together and our ranks grow because there's more hunger and more skills. That is what causes more people to join piracy. The world cannot do anything about it.
CARROLL: So will cruise companies change course to avoid troubled waters? Cunard, which owns two liners scheduled to sail near the Somali coast next March says, "We continue to monitor the situation in the Gulf of Aden closely. We have not made any changes to our ships' itineraries. We continue to believe that there are adequate security measures in place."
Security experts say powerful water cannons are effective defense tools. So too are long-range sound devices.
WILL GEDDES, SECURITY SPECIALIST, ICP GROUP: That emits a very high, loud frequency that disrupts the pirates from coming close to the ship.
CARROLL: But Will Geddes, like other security experts still discourages ships from hiring armed guards. GARY NOESNER, RETIRED CHIEF FBI CRISIS NEGOTIATION UNIT: Whenever you put armed individuals on a ship, it's upsetting to people who are hoping to take a leisurely vacation cruise.
CARROLL: Gary Noesner, a former FBI chief hostage negotiator, says a greater international military and naval presence is needed in the Gulf of Aden.
NOESNER: Only government has the capabilities through their naval forces or other military components to effectively deal with this very violent criminal enterprise.
(END VIDEOTAPE)
CARROLL: Security experts say there needs to be a new U.N. resolution that will let military and naval forces to actively engage these pirates. Those same experts worry about copycat attacks by terrorists. A Navy spokesman is advising ships to go through the international corridor which is an area of water patrolled by those military forces out there.
CHETRY: Still no guarantees. I'm just wondering if it makes you think twice before you decide to go on a cruise.
CARROLL: Well, you know, travel agents are definitely worried about this, as are the cruise ship owners as well, trying to figure out what they can do without scaring passengers.
CHETRY: Right. Jason, thank you.
ROBERTS: A warning that we're not ready for an attack by WMDs, and the time may be running out. Can the U.S. stop bio terror or even nukes by 2013? We'll ask a former Homeland Security adviser to the president about that.
CHETRY: American health care.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Nearly 100,000 American families this year will end up in bankruptcy because of a cancer diagnosis.
(END VIDEO CLIP)
CHETRY: Diagnosis disaster. But the medicine this country needs could cost a trillion dollars. How do you save lives and still save money?
Dr. Sanjay Gupta's "Memo to the President."
You're watching the "Most News in the Morning."
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP) SEN. JOE BIDEN (D), VICE PRESIDENT-ELECT: We're not doing all we can to prevent the world's most lethal weapons from winding up in the hands of terrorists. But this report is, in my view, more than a -- more than a warning about what we're doing wrong. It's a pragmatic blueprint how to get it right.
(END VIDEO CLIP)
ROBERTS: Vice President-elect Joe Biden reacting to a grave warning about weapons of mass destruction. A panel that briefed Biden and President Bush found that terrorists are likely to use a weapon of mass destruction somewhere in the world within five years. Most likely, they say, it would be a biological weapon.
Joining me now to talk more about this threat is Fran Townsend. She served as President Bush's Homeland Security adviser. She's also a CNN national security contributor.
Fran, good to see you this morning. Were you surprised by the findings of this report?
FRANCES TOWNSEND, CNN NATL. SECURITY CONTRIBUTOR: I wasn't, John. You know, al-Qaeda has been very explicit about their desire to acquire weapons of mass destruction. There's been a -- bin Laden issued a Fa (ph) law authorizing the use against civilian populations. And so, I was not all surprised by the threat that the commission saw or the actions that they were recommending.
ROBERTS: On this idea of the strength of al-Qaeda, here's what chairman, former Senator Bob Gramm of the commission, said about al- Qaeda. He said, "Al-Qaeda has reorganized itself in the last eight years into a more nimble and global organization."
It's been seven years now since 9/11, Fran. A more nimble and global organization. After the hundreds and billions of dollars and the manpower that's been spent fighting the war on terror, shouldn't al- Qaeda be in tatters?
TOWNSEND: Well, you would hope it would be. But, John, you know, the single greatest enabler to a terrorist organization is a safe haven where they can plan and train and recruit and raise money. And they -- al-Qaeda has found that in the federally administrative tribal areas of Pakistan. And so when you look at all the money we spent, we've weakened their leadership but we haven't weakened the organization because they still have the safe haven.
ROBERTS: Did you agree with some other Homeland Security experts. I know people who are charged with, you know, looking after big cities in America who believe that the next attack against American soil will originate from those tribal areas?
TOWNSEND: Absolutely. There's not a doubt in my mind if there's an attack here in the United States, we will find remnants, clues that lead back to the federally administrative tribal areas.
Look at the planned attack in 2006. Remember that was the airliners coming out of London towards the United States. That plot had real ties back to those tribal areas and I think terrorism experts expect that if we saw an attack it would have links back to the tribal areas.
ROBERTS: You know, let's talk about the domestic response to all of this in terms of the military versus civilian organizations. There's already one brigade based at Fort Stewart, Georgia, a military brigade, that is tasked with actively responding to a potential terrorist attack. It's expected that by 2011 that number of brigades could be increased to three, maybe even four. As many as 20,000 troops deployed domestically.
Is that the best use of U.S. forces? Some people are saying hey, this might be on the edge of a police state. Certainly, there may be some violation of the Posse Comitatus Act here that prohibits American military from acting in a law enforcement capacity.
TOWNSEND: John, those are all the right questions. But in fact, I think, people ought to take comfort from this. This is a response force. This is not, these are not forces that are going to be trained to do general law enforcement activities which is what's prevented by Posse Comitatus, the law preventing military from acting on law enforcement matters domestically. This is really a response force meant to bolster the capability of our state and local first responders, the people who are first on the scene but they will be highly trained, deployed across the country. Consistent with the way we've used the one civil support team you mentioned in Georgia, this is just greater capability, more widely dispersed and available to the nation's governors and the federal government and the president in the event of a catastrophic attack. We ought to take comfort that we had this redundancy and capability.
JOHN ROBERTS, CNN, ANCHOR: Fran, it's always great to get our perspective on these things. Thanks for joining us this morning.
TOWNSEND: Great to see you.
ROBERTS: All right.
KIRAN CHETRY, CNN, ANCHOR: 30 minutes after the hour. A look at the top stories. Three men in charge of the American auto industry will be back on Capitol Hill in just a few hours making one final plea for your money. $34 billion of it. It all comes as a new poll that shows six in 10 Americans are against bailing out the big three auto giants. GM says it needs four billion this month just so it won't go broke.
And still getting cheaper to fill up your car. AAA saying the national average price now for a gallon of regular is $1.79 a gallon. Down a penny overnight. It's the 78th straight decline in gas prices, in fact gas has not been this cheap since January of 2005.
O.J. Simpson could go away for the rest of his life tomorrow. He'll be sentenced in Las Vegas on armed robbery and kidnapping charges for being involved in a hold up on sports memorabilia dealers.
Hillary Clinton's nomination to secretary of state could hit a legal wall. Some are pointing to a little known clause in the constitution that could actually prevent her appointment. Politico.com is reporting that her fellow senators are now taking steps to possibly work on making sure that doesn't happen. Senior legal analyst Jeffrey Toobin is here to explain it to us. First of all explain the clause in the constitution that we're talking about.
JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: OK. You know, of course, Article I, section 6, clause 2. No I never heard of it until this either. Don't worry. It's called the Emoluments Clause and it says in effect that if a senator votes to raise the salary of a cabinet member that senator can't, in turn, take that position. Now, the salary of the secretary of state has risen while Senator Clinton has been a senator so the question is, does that provision bar her from being a senator?
CHETRY: All right. When we talked to you about this earlier in the week you said you didn't think this would be a problem. In fact, you said it was perhaps a bit ridiculous. Why are they, I guess, preparing, possibly, legislation to try to safeguard.
TOOBIN: Well, what they have done is historically in the last sort of 20 or 30 years is do something called the Saxbe Fix which is named after William Saxbe which was a senator from Ohio, named attorney general by President Nixon not President Ford as I said earlier. I made a mistake. But he, they passed a law that rolled back his salary to the previous amount so that there was no raise in effect and constitutionally that was seen as fixing the problem and that's now, the Saxbe Fix and that's what they are planning to do for Hillary Clinton is roll back her salary to what it was before she became a U.S. senator.
CHETRY: Correct me if I'm wrong, are you not allowed to make legislation that just pertains to one person?
TOOBIN: You know what, that's called a bill of attainder. What they do is just they reduce the salary of the secretary of state.
CHETRY: I got you.
TOOBIN: They don't happen to say Hillary Clinton.
CHETRY: They can still name it the Clinton Fix.
TOOBIN: They can name it, nickname it the Clinton Fix but that's right.
CHETRY: I got you. Now the worse case scenario here, though. Could this clause prevent her from actually becoming secretary of state.
TOOBIN: You know what, I don't really see any way. because if you want to get super technical about it, I don't think anyone has legal standing to file a lawsuit. Taxpayers don't have standing. Voters don't have standing. I don't see how you would get a case to a court challenging it. Plus, she even has a defense. She never voted to raise the salary.
CHETRY: She just happened to be there.
TOOBIN: She was there when cost of living increases went into effect. So you could argue that even though the salary went up she didn't push the salary up as a senator. So Hillary Clinton's problem is getting confirmed, is doing a good job. The Constitution is not going to be a problem.
CHETRY: I got you. All right. Thanks, Jeff.
TOOBIN: We'll see. We got rid of the Posse Comitatus, the bill of attainder, we got articles. This is like constitutional law class this morning.
CHETRY: If you can't say Posse Comitatus at least once a morning you're not living.
TOOBIN: Exactly.
ROBERTS: Brought to us by the same people who gave us $60 ashtrays.
TOOBIN: There you go.
ROBERTS: Thanks, Jeff.
Book smarts beat business sense. One teacher pinching pennies to buy his school supplies find sponsors to make ends meet. And going poor because you're sick. 100,000 Americans will end up in bankruptcy this year because of a cancer diagnosis. What Barack Obama can do for treating the sick with the economy on life support. Dr. Sanjay Gupta joins us with our next "Memo to the President." It's 35 minutes after the hour.
(COMMERCIAL BREAK)
ROBERTS: Welcome back to "the most news in the morning." With school systems already under-funded one California teacher is thinking outside the box to raise money for his students by actually selling advertising on his tests. Ted Rowlands is looking at his plan and the fallout from it. He's here now, Ted.
TED ROWLANDS, CNN CORRESPONDENT: John and Kiran, usually when schools need money they have a bake sale or they hit the parents up for extra cash but calculus teacher Tom Farber said he wanted to do something different.
(BEGIN VIDEOTAPE)
ROWLANDS: When students are handed a test in Tom Farber's calculus class at the Rancho Bernardo High School near San Diego, the first thing many of them do is to look to see who is sponsoring it.
UNIDENTIFIED FEMALE: It's kind of fun, parents can wish their children well on the test if they want to.
ROWLANDS: Every test and even quizzes are sponsored, mainly by parents. Orthodontists Stephen Henry sponsored this test. His message, brace yourself for a great semester. His daughter is in Mr. Farber's class.
DR. STEPHEN HENRY, ORTHODONTIST & PARENT: It didn't seem like a lot of money, especially if a lot of parents contributed to it. So I thought it would be worthwhile, particularly since my two girls go to that school.
ROWLANDS: The idea came after budget cuts reduced supplies at the school by 30 percent. Teachers were told to come up with their own solutions.
TED FARBER, CALCULUS TEACHER: So I said you know what I'm going to do it in a more creative way.
ROWLANDS: For $10 you can buy an ad on a quiz, $20 will get your message on a test, final exam runs $30. There's only one ad per test, always a one line message on the bottom of page one. Farber said he has already made more than $300 enough to make up for the budget cuts. Is there anything wrong with this idea? Lawrence Pike is an expert on education funding at the University of Southern California.
LAWRENCE PIKE, UNIVERSITY OF SOUTHERN CALIFORNIA: I don't know if anything is wrong with advertising on the test. Something doesn't feel quite right. I don't know that a small one line advertisement which is what seemed to be as a real distraction on a test. But I think of more concern is why does a teacher have to resort to raising outside money.
ROWLAND: Tom Farber agrees. He said he would be more than happy to stop placing ads on tests for a price.
FARBER: If you really disagree with what I'm doing, and you need to get your wallet out.
(END VIDEOTAPE)
ROWLANDS: Farber says he's yet to sell any ad space on his exams to any major retailers or chains but he says he's not ruling it out. Kiran and John he says that he has enough money now for his class so he's giving the rest of his proceeds to other teachers in his math department.
CHETRY: Well, Ted Rowlands for us. Thanks.
A big Hollywood star with a new passion and it involves you. Helen Hunt will be joining us live to tell us what you can do to wind up in a commercial at the Oscars.
And Congress under fire for how it's spending your tax money. A half billion dollar capital visitor center, billions more in bailouts. Is Congress simply out of touch? It's 40 minutes after the hour.
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ROBERTS: Good morning from Hartsfield International Airport in Atlanta where it's cloudy and 38 degrees right now. Later on today it's going to go up to about a high of 56. Still rainy. Our Reynolds Wolf is down there in Atlanta today. He's tracking the extreme weather across the country. Reynolds, what's going on? It doesn't rain for two years and now it won't stop.
REYNOLDS WOLF, CNN METEOROLOGIST: Yes, I know. We're catching up on the drought. I mean things are pretty good in Atlanta. We're not complaining about that. Certainly though we're talking about rain, we're not talking about snowfall. You want to talk about snow, take a look at this video. This is from Pardeeville, Wisconsin. In the video we're going to show you, well pretty much just white conditions. They had several inches of snowfall. Pardeeville is just about an hour and a half to the northwest of Milwaukee. Pretty nice small town. It's not Partiville. Partiville would be in Madison, Wisconsin, near the campus of the University of Wisconsin after a big game day.
Meanwhile let's go back and show you some travel trouble that we may be dealing with. In California the story is going to be some low clouds, possibly some fog in places like Los Angeles and San Francisco. We'll also look for some problems in all the airports in New York, Atlanta, Nashville, and Pittsburgh, the low clouds and the rain. In Atlanta, the rains are developing into the mid day hours and into the afternoon.
For the center of the U.S. though conditions are going to be just fine. High pressure is going to be your dominating feature. Very cold air moving into the northern half of the U.S. Some scattered snow showers, maybe especially heavy just to the west of Denver. We're looking at the highest elevations maybe getting up to a foot of snowfall. Lake-effect snowfall really beginning to kick in for the northern half of Michigan and back over to say Buffalo. Places near Buffalo, you could have light density snowfall. But north of Syracuse that could get heavy later on today. There are scattered showers and temperatures in the 50s for Atlanta. Tampa with 75 degrees is the expected high. Denver with 23 degrees. Portland, Oregon with 51. San Francisco with 63. New York temperatures this morning only to the 40s but warming up to 49 degrees. Not that bad of a day. At our nation's capital, the high expected of 53. That's a look at your forecast. John, let's send it right back to you.
ROBERTS: Reynolds, thanks so much for that. We know you know that rain maybe not so nice for folks down there in Atlanta but you got to fill Lake Lanier back up again. Appreciate it.
WOLF: Absolutely.
ROBERTS: Thanks.
CHETRY: Also let's say you want to make an appointment to sit down with the president. Well you better hurry up and get friendly with one man who is Obama's new chief of staff. What you don't know about Rahm Emanuel. Also with the economy a mess, big companies begging for a bailout. Was this the right time for a lavish new visitor center? Controversy over a half billion dollar tourist spot at the capital.
(COMMERCIAL BREAK) CHETRY: Well Barack Obama promised staggering health care reform before the economy hit the tank. So how soon can we get there for so many sick people who need it right now? Dr. Sanjay Gupta has today's "Memo to the President."
(BEGIN VIDEOTAPE)
DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: Mr. President, as a doctor and a parent I'm more worried than ever about health care in America. Nearly 46 million Americans are uninsured. And even those with insurance often can't get quality care. So a tough diagnosis means even tougher choices.
DAN SMITH, PRESIDENT, AMERICAN CANCER SOCIETY: Nearly 100,000 American families this year will end up in bankruptcy because of a cancer diagnosis. It's just not right. When you get cancer it's hard enough to fight the disease without having to fight for the care you need.
SEN. BARACK OBAMA (D), PRESIDENT-ELECT: The question isn't how can we afford to focus on health care, the question is how can we afford not to?
GUPTA: He campaigned on the promise of change. But with a failing economy and a health care plan estimated to cost more than a trillion dollars over the next decade, how do you plan to pay for it all? And what about your promise to pursue embryonic stem cell research?
OBAMA: If we are going to discard those embryos and we know that there's potential research that could lead to curing debilitating diseases, Alzheimer's Lou Gehrig's disease, if that possibility presents itself then I think that we should in a careful way go ahead and pursue that research.
GUPTA: More research has been promised by politicians for years. Will you put other projects aside to add federal funding for stem cell? How will you convince the critics? Finally, Mr. President, we can no longer ignore the obesity problem in America. It causes preventable diseases at astronomical costs. About 80 percent of our health care dollars are spent taking care of people who are already sick. It's time to create a culture of prevention, to save lives and to save money.
(END VIDEOTAPE)
GUPTA: A lot of people are talking about that culture of prevention. Medically, financially, morally, it seems like the right thing to do and we start to see Kiran the effects of prevention. For example in states that have smoking bans, California has had a smoking ban since '95 in some work places. You're starting to see lung cancer rates go down. So prevention can work but you need to have some leadership here.
CHETRY: What are people saying in the health care community? Are they optimistic that this is going to happen or with everything that we're dealing with right now is universal health care or even changes in health care is sort of going to fall to the bottom of the rung right now?
GUPTA: With the economy, you there's a lot of different price tags that I've heard on this. One that we have placed some confidence in is over a trillion dollars over the next 10 years. So that's a lot of money. But still talking to a lot of the organized medical groups. They are optimistic we are going to see some sort of health care reform. And you do have a president-elect who says he's going to make it a priority within the first 100 days. So I think we're going to see something. I don't know if it's going to be as dramatic as some of the things I've outlined in the piece here. But I think within the first year or so, we're going to see a changed system from what it is today.
CHETRY: Very interesting. And you're right, you talk about the prevention and we talk about obesity as being the number one way to prevent disease.
GUPTA: Yes. You know and we do these segments every week. As you know, in your show because on your show people's eyes sometimes glaze over when you talk about obesity but it's been interesting to do these pieces because I think people really do understand that there is a problem. it's a fixable problem. This nation used to be one of the most robust, vibrant, healthy nation on the planet and gone from being that planet to not so healthy. We can fix that problem again.
CHETRY: All right. Sanjay Gupta, great to see you. Thanks.
GUPTA: Thanks, Kiran.
CHETRY: Tomorrow, by the way, our memo is about interrogation. With allegations of torture, damaging America's reputation around the world, how can the next president turn it around? The immediate action he can take to change the system. We also want to hear from you. Send us your "Memo to the President." Cnn.com/am, click on the i-report link and send the president-elect your concerns.
(BEGIN VIDEOTAPE)
CHETRY (voice-over): Pilots with guns, trained to protect you, right? The serious design flaw that has even pilots afraid.
UNIDENTIFIED MALE: It's beginning to look a lot like Christmas.
CHETRY: The most annoying Christmas song on earth now playing in the mall. Hold your ears.
LOLA OGUNNAIKE, CNN ENTERTAINMENT CORRESPONDENT: If I hear "Jingle Bells" one more time -
CHETRY: You're watching the most news in the morning.
(MUSIC PLAYING)
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(COMMERCIAL BREAK) (BEGIN VIDEO CLIP)
JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": Well, a lot of Wall Street experts are saying there are incredible bargains right now in the stock market. Is this a good time to buy? It's a great time to buy. Kind of after a huge car crash, there are auto parts lying all around.
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ROBERTS: The request by Detroit automakers for a bailout is not sitting well with most Americans. A new CNN opinion research corporation poll shows 61 percent are dead set against the federal government using taxpayer money to rescue the ailing automakers.
And Pennsylvania Congressman Bill Shuster agrees with them. He's not convinced that a bailout would change the way Detroit's big three auto makers do business going forward. The republican lawmaker once owned a Chrysler dealership so he brings a real world perspective to the debate.
Congressman Shuster joins us now from (Altoona) Pennsylvania. Congressman, it's good to see you. So the Detroit big three automakers are warning that they could go bust within weeks if they don't get this bailout, so why won't you give it to them?
REP. BILL SHUSTER, AGAINST AUTO BAILOUT: Well, thanks, John, for having me on this morning. I think it's extremely important that we have a strong and competitive auto industry. I don't believe the answer though is to come to Washington a couple weeks ago without a plan, then be forced by Congress to come back with a plan. I'm concerned that we haven't looked at the details and these projections that are coming out of Detroit from these CEOs I believe may be too rosy. I think that in the end, they got to have some significant restructuring in Detroit's auto industry to be able to come out of this a competitive and strong industry which we need in this country.
ROBERTS: What do you mean the projections may be too rosy? Is this their downsizing plan? You don't buy it?
SHUSTER: Well, again, I haven't looked at the plan. I haven't seen the details. A couple of these companies have said they're going to be back in profitability by 2010, 2011. I just don't see how they can with the problems they face. So I'm concerned these projections are rosy scenario coming to Congress, trying to sell us on this bailout plan. I think there needs to be some tough restructuring. It's not just the leadership of the auto industry that I have doubts about. It's also leadership of the UAW, that they've got to make some tough decisions.
If you look at the three things to measure the industry by, profitability and market share, they've both been declining and poor, or the number of jobs in the UAW has seen a significant loss of jobs over the past 10 years. So leadership hasn't done the job either in the unions or at the headquarters of the automakers. ROBERTS: Well, let me just drill down a little bit on that issue of leadership. That's something that Michael Moore was talking about last night on "Larry King Live." Let's listen to what he said about it.
SHUSTER: Sure.
(BEGIN VIDEO CLIP)
MICHAEL MOORE, FILMMAKER: I don't oppose the so called bailout. I just oppose giving the $34 billion to the current people in charge. We have to put up whatever money is necessary to protect the industrial infrastructure of this country.
(END VIDEO CLIP)
ROBERTS: So he's saying he doesn't trust the current leadership. This is a remarkable occasion where we have a republican congressman from Pennsylvania and Michael Moore apparently on the same page.
SHUSTER: Well, I can tell you I'm no fan of Michael Moore, but I do believe that there needs to be new leadership injected into the big three automakers, we need to have people at the top with an entrepreneurial spirit, some of these folks that are running not just the top three slots but many of the executives have been there for years and years. I think it's time for a shake-up. Not only at the big three management level but also at the UAW. Their leadership has not performed the way that they should have over the past decade.
ROBERTS: And let's look at this from the real world perspective. You used to own a Chrysler dealership before you went to Congress. 700 automobile dealerships have closed this year. That number expected to grow to 900 by the end of this year. There are three million people peripherally connected to the auto industry in some way, shape, or form. If Congress doesn't come out with some sort of plan to inject some cash into this industry and keep them on their feet, are you not risking a whole lot of people being out of work who are not necessarily making cars but everybody out there in the industry connected to selling cars?
SHUSTER: Well, my former dealership was one of those that closed this year. So I know first hand about that. But I think it's nonsense to think that there are going to be three million people overnight out of work. What's going to happen is people are going to - if one of the auto manufactures would happen to close down you would have other manufacturers picking up the slack, hiring workers to produce cars. And in dealerships across the country, if they close, most of those people go to other dealerships or other people in the auto industry to get jobs. So it's nonsense to think overnight we're going to lose all three million jobs. This is a serious situation. We need an auto industry in this country, a vibrant and strong auto industry. But to do it, they've got to make some significant changes.
ROBERTS: Congressman Bill Shuster joining us this morning. Sorry that your ear piece popped out. They're probably put on by the same people who put the trim on the inside of my car. It keeps coming off, too.
Congressman, good to see you. Thanks.
SHUSTER: Thank you very much, John. Thank you.
