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American Morning
Obama's Bipartisan Cabinet; Madoff Under House Detention; Looking Back on the Impeachment of a President; Economic Worst Case Scenario
Aired December 18, 2008 - 08:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KIRAN CHETRY, CNN ANCHOR: Well, it's 8:00 on the nose here in New York. A look at the top stories this morning. We're waiting for the latest numbers on the job market. They're going to be released in about half an hour. Last week, 573,000 people lined up for jobless benefits for the first time, and that is the most since the recession of the early 1980s.
Right now, Illinois State lawmakers are reviewing their legal options to see if there is enough evidence to impeach embattled Governor Rod Blagojevich. Yesterday, the state Supreme Court refused to hear a motion that would have declare the governor unfit to serve.
Another sign of bipartisanship in the president-elect's administration. CNN has learned that Barack Obama will name Republican Congressman Ray LaHood to be Transportation secretary. He will be the second Republican in Obama's cabinet joining Robert Gates, who is going to be staying on as Defense secretary. Our Brianna Keilar is live in Chicago following the new Obama appointments.
What do we know about LaHood, Brianna?
BRIANNA KEILAR, CNN CORRESPONDENT: And I should just tell you we just have this confirmed right now, Kiran, that according to a Democratic, a senior Democratic official, LaHood will be announced tomorrow actually as the president-elect's pick for Transportation secretary.
This is someone who news of his pick has really been praised by both Republicans and Democrats. He's someone well-known for reaching across the aisle, and of course, he does have some expertise when it comes to transportation. And certainly has a position when it comes to transportation.
As a congressman, he has been a strong supporter of ethanol production. He represents a district with a lot of farmland. And he's also been in support of Illinois's infrastructure, working on improving local highways and airports. But as well, he is a 7th term congressman, as I said, from Illinois.
Sort of an interesting fact is that he represents all of the counties that Abraham Lincoln represented in the mid-1800s. And maybe most importantly, he is a member of the House Appropriations Committee. Very important committee on the Hill, in charge of the Purse Strings of Congress. So he certainly has some insight into the fiscal dimension of caring for the nation's transportation system. CHETRY: You know, there's also another controversy this morning over the president-elect selecting Evangelical pastor Rick Warren to deliver the invocation of the presidential inauguration next month. It's interesting because there has been a growing outreach among Democrats who said we have to reach out to Evangelicals, that, you know, the GOP does not have a lock on them. But listen to what Democratic analyst Hilary Rosen told us earlier on AMERICAN MORNING.
(BEGIN VIDEO CLIP)
HILARY ROSEN, DEMOCRATIC ANALYST: I think in this case, they are all just wrong. They wouldn't say that if it were about any other, you know, constituent group. I just think that on this day, in this moment, he could have found and should have found pastors and preachers that have a more inclusive, holistic message for the country.
(END VIDEO CLIP)
CHETRY: And Brianna, she, like some are very upset about Pastor Warren's support for Proposition 8 in California, which did pass narrowly that made gay marriage illegal in the state. What's the Obama team saying about this?
KEILAR: They are responding to this criticism. In fact, a spokeswoman, Linda Douglas, saying the president-elect certainly disagrees with Warren on lesbian, gay, bisexual and transgender issues, but it has always been his goal to find common ground with people with whom you may disagree on some issues.
So what the Obama camp is also doing is really trying to point to ideological areas where Warren and Obama overlap, including fighting poverty and fighting AIDS. Obama made a promise on the campaign trail, really to move towards post-partisan politics to include people that are not normally included in the Democratic Party. And he's clearly trying to make good on that promise. But what he is experiencing, Kiran, is the pitfalls of doing that, because he's very much upset, a core Democratic constituency in picking Rick Warren to do the invocation in his inauguration.
CHETRY: All right. Brianna Keilar for us, thanks.
JOHN ROBERTS, CNN ANCHOR: You are accused of fooling the SEC for a decade. Defrauding a group of rather smart, really rich people for about $50 billion. So what happens next? Well, you get put under house arrest in your multi-million dollar New York apartment.
Our Allan Chernoff is following the extraordinarily and growingly curious case of Bernard Madoff for us this morning.
Good morning to you, Allan.
ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: Good morning, John. It is an incredible case.
ROBERTS: Unbelievable. CHERNOFF: Just astounding. And Bernie Madoff is in his multi- million dollar Upper East Side Manhattan apartment this morning, wearing an electronic monitoring device under terms of his $10 million bail. He made off, he's under home detention, and a curfew -- 7:00 p.m. through 9:00 a.m.
His attorney agreed to those bail terms after only his wife and brother, but not his two sons would sign off on his bond.
With only two signatures on that bond, the Madoffs had to post their homes in Montauk, New York and Palm Beach, Florida as part of the bail agreement. Court document say that Madoff admitted to the FBI that his investment firm had covered up billions in losses. He's facing a single count of securities fraud which carries a maximum sentence of 20 years in prison.
And from his lead attorney's comment to CNN, it would seem he does not plan to contest the charge. Defense attorney Ira Sorkin saying, quote, "this is a tragedy." We are cooperating fully with the government investigation to minimize losses.
ROBERTS: It's tough when you have to put your house in Montauk and Palm Beach up to post bond. But where were the regulators in all of this?
CHERNOFF: That is the question of the hour. And it will continue for sometime. I mean, the SEC did look into Madoff, but fail to uncover fraud. Madoff investors are furious. And so is the current chairman of the SEC.
(BEGIN VIDEO CLIP)
CHRISTOPHER COX, SEC CHAIRMAN: I was very concerned to learn this week that credible allegations about Mr. Madoff had been made over nearly a decade, and yet never referred to the commission for action.
(END VIDEO CLIP)
CHERNOFF: Cox says there is no evidence of wrong-doing yet by SEC's staff, but he has asked SEC inspector General David Kotz to investigate, and Kotz tell CNN, among the issues that he will examine is the relationship between a former SEC attorney who did inspect the Madoff firm and Bernard Madoff's niece who he married last year. A spokesman for the former SEC attorney says that he did not participate in any examination of Madoff while he was involved with Madoff's niece.
(BEGIN VIDEO CLIP)
PROF. JOHN COFFEE, COLUMBIA UNIVERSITY BUSINESS SCHOOL: The SEC is supposed to be the tough cop on Wall Street. They look more like a lap dog here that was deferring to a prominent figure.
(END VIDEO CLIP) CHERNOFF: John Coffee, a very well-respected Securities' attorney and professor. And clearly, John, this case appears to be an enormous embarrassment for the Securities of Exchange Commission. The wealthiest investors in the world got no protection here.
ROBERTS: As always, Allan Chernoff, the master of understatement today. Thanks so much for that.
Kiran --
CHETRY: Christine Romans is "Minding Your Business" this morning. One thing she's talking about is the outrage over these continued big bonuses.
That even though we're in tough times right now and a lot of mistakes were made, people are still getting these million dollar bonuses.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: They're still getting these million dollar bonuses, but what a lot of people are really irritated about is the fact that for the past few years, really the last decade, the bonus structure on Wall Street just exploded.
I mean, you had billions and billions of dollars and bonuses going for some of these firms from top to bottom. At the same time, some really horrible, horrible decisions were being made that have now affected all of us. That have brought the financial system to its knees.
People were rewarded for this for years. There's no way to claw that back, even now as the economy is really suffering. So there's just this outrage that there is a culture of rewarding people for taking and making risky decision to make quick profits, and then we're all paying for it now.
Look at the bonuses on what total compensation for these bonuses. You know, 2007, for example, $33 billion paid out in bonuses. 2006 -- I mean, this was the peak of all this garbage that they were coming up with in this corner trading offices and selling around the world. $34 billion, almost. 2005, $21 billion. Now, this year, we're told that bonuses are probably be half of that $33 billion. That's still $15 billion.
And what I think a lot of people don't understand is on Wall Street, people made a $100,000 or $200,000. It is a lot of money as their salary. But those bonuses, when they came up with some new sexy product, a really terrible mortgage-backed security to sell around the world, they made even more. So they were rewarded for making the decisions that have now got us where we are.
CHETRY: In short, is this going to continue in 2009? Are we going to see the end of this because of what's going on?
ROMANS: Well, you know, I though before we were going to see the end of outrages bonuses after, you know, all the corporate corruption of the early 2000s, and we didn't. So, I mean, I never really counter out the fact that Wall Street finds a way to pay itself good times or bad.
CHETRY: Wow. Christine Romans, thanks. Nine minutes after the hour.
Famous last words.
(BEGIN VIDEO CLIP)
WILLIAM JEFFERSON CLINTON, FORMER PRESIDENT OF THE UNITED STATES: I did not have sexual relations with that woman -- Miss Lewinsky.
(END VIDEO CLIP)
CHETRY: An intern, a president and a country divided. 10 years after the Clinton impeachment, where are all the key players now?
You're watching Most News in the Morning.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
W. CLINTON: I did not have sexual relations with that woman.
(END VIDEO CLIP)
ROBERTS: Well, it is hard to believe that it has been 10 years since we heard President Clinton say those now famous words. And we all know what happened next -- the impeachment of an American president. CNN's special correspondent Frank Sesno is in Washington for us this morning.
And Frank, who could believe it? 10 years ago tomorrow, he was impeached in Congress. Amazing how time goes by.
FRANK SESNO, CNN SPECIAL CORRESPONDENT: Yes. You want to amble down memory lane for a minute, try this. You know, Monica Lewinsky, Linda Tripp, Ken Starr, the blue dress, Bill Ginsburg. It almost brought down a presidency. It was one of the most bizarre chapters in American history.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: That William Jefferson Clinton, president of the United States is impeached for high crimes and Misdemeanors.
SESNO (voice-over): It was 10 years ago.
UNIDENTIFIED MALE: Perjuries, misleading and untruthful.
UNIDENTIFIED MALE: Mr. Speaker, this is wrong, wrong, wrong.
SESNO: The impeachment of a president. It had been tawdry and tortured, this becoming this.
W. CLINTON: I did not have sexual relations with that woman -- Miss Lewinsky.
SESNO: But it was really about truth and consequences.
W. CLINTON: I never told anybody to lie. Not a single time. Never. These allegations are false.
SESNO: But they weren't.
Monica Lewinsky, a young White House intern and the president had what was politely called inappropriate contact. He got into trouble for what he told investigators.
W. CLINTON: It depends upon what the meaning of the word is is.
UNIDENTIFIED MALE: The evidence suggests that the president repeatedly used the machinery of government and the powers of his high office to conceal his relationship.
SESNO: The scandal divided the country.
UNIDENTIFIED MALE: A nation of laws cannot be ruled by a person who breaks the law.
UNIDENTIFIED MALE: When this will mindless cannibalism end? How many good public officials must be destroyed because of their private sins and human imperfections?
SESNO: It paralyzed the presidency and made their private lives and foibles painfully public. It became about survival so the Clintons circled the wagons and went on the offensive.
HILLARY CLINTON, WIFE OF WILLIAM JEFFERSON CLINTON: The great story here for anybody willing to find it and write about it and explain it, is this vast right wing conspiracy that has been conspiring against my husband since the day he announced for president.
SESNO: The impeachment hearings live and graphic detail captured a year of this. The House voted to impeach, but the Senate did not convey. He's worked ever since to reclaim his reputation. She's run the marathon and has gained influence. But there will always be that history. And private lives will always be the quick sand of American politics.
(END VIDEOTAPE)
SESNO: John, the quick sand of American politics, but in the case of the Clintons, an extraordinary couple, persistent, political, a strong sense of survival. They've come out the other side. The stronger for them in many cases. But 10 years ago, wow. I mean, it's hard to believe.
ROBERTS: Yes. But he went through all of that. He left office with an approval rating around 60 percent, continues to be in the 60s even now. What was the secret to his political survival through that impeachment process? SESNO: A couple of them. Incredible instincts. A war room that they set up in the White House to rebut every allegation as it came out. A campaign against Ken Starr, the independent council to politicize the entire thing. And in the end, John, a rejection by the American public that that, you know, mini affair or maxi affair, depending on what you want to call it, as ugly as it was in the Oval Office and beyond, really mattered. And was enough to constitute throwing a president out.
By the way, Monica Lewinsky -- she went to graduate school, under school of economics. Her graduate thesis "In Search of the Impartial Juror and Exploration of the Third Person Effect and Pre-trial Publicity."
ROBERTS: Wow.
Frank Sesno, good to talk to you this morning. Thanks for coming in.
SESNO: Thanks, John. 10 years ago.
ROBERTS: Yes. Who could believe it? 16 minutes now after the hour.
Economic melt down distraction.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: The United States government couldn't figure out Bernie Madoff, how are you going to figure out Vladimir Putin?
(END VIDEO CLIP)
ROBERTS: New fears that terrorist could strike using the world economy as a weapon.
You're watching the Most News in the Morning.
(COMMERCIAL BREAK)
CHETRY: Welcome back to the Most News in the Morning.
Even with the economy and a recession, the sad truth is that while things are bad, they could always get worse. But what is the worst case scenario? Jim Acosta is looking at that from Washington this morning.
I don't even know if we want to know, Jim.
JIM ACOSTA, CNN CORRESPONDENT: I don't think we want to know either, Kiran. Isn't this supposed to be the holiday season? We talked to a gentleman who thinks about worst case scenarios and it's tempting to write them off as a bit of "Chicken Little." But people didn't listen to "Chicken Little," and people are listening to James Rickards. Consider some of the people who are listening to his advice -- the offices of the Director of National Intelligence and the Secretary of Defense.
(BEGIN VIDEOTAPE)
ACOSTA (voice-over): James Records spends his time thinking about bad things that could happen to America at the worst possible time, as in right now during the current financial crisis.
JAMES RICKARDS, ADVISER TO DIRECTOR OF NATIONAL INTELLIGENCE: The United States is just more vulnerable when we are in the state of weakened conditions.
ACOSTA: Rickards, a former hedge fund guru who now advises the nation's top intelligence and defense officials, says consider what Osama bin Laden observed shortly after 9/11.
RICKARDS: He immediately started talking about the stock market. He knew exactly how much the stock market had gone down.
ACOSTA: Rickards says an al Qaeda hit on America during a economic meltdown is just one of several worst case scenarios. Consider China. Conventional wisdom is that China would never drop (ph) its roughly $1 trillion in holdings of U.S. debt because it would hurt America's ability to buy Chinese products.
RICKARDS: But actors and allies are always rational (ph).
ACOSTA: Then there's Russia. Rich in natural gas, it could try to wreak havoc with the global energy market. It's a country that also has a lot of gold. What if the Russians try to come up with a new gold-based currency to compete with the weakened U.S. dollar?
RICKARDS: They United States government couldn't figure out Bernard Madoff, how are you going to figure out Vladimir Putin? I'm not saying these threats are happening in real time. What I am saying is, what is our capability to analyze and think about them?
ACOSTA: Threats, Rickards says, they could be tougher to stop if the world economy gets worse.
RICKARDS: You know, the financial experts don't talk to the defense people and the defense people don't talk to the financial experts, and so, the government, I don't think, has done nearly as much as it could to kind of integrate those two.
ACOSTA: Would it be a good idea to have people in the Defense Department with financial backgrounds and people in the Treasury Department with defense backgrounds?
RICKARDS: It would absolutely be a good idea.
ACOSTA: Hedge fund managers consulting with the Defense Department?
RICKARDS: I think that's exactly right.
(END VIDEOTAPE) ACOSTA: It was once said that 9/11 was not so much a failure of intelligence, but a failure of imagination. By bringing together the best thinking from Wall Street and the Pentagon, the hope is America may do a better job of anticipating the dangers lurking in an unstable global economy -- Kiran.
CHETRY: A lot to think about. That's for sure. Jim Acosta...
ACOSTA: (INAUDIBLE).
CHETRY: Yes, exactly. Thanks so much. It's 22 minutes after the hour.
ROBERTS: One-on-one with Condoleezza Rice.
(BEGIN VIDEO CLIP)
ZAIN VERJEE, CNN STATE DEPARTMENT CORRESPONDENT (on camera): Do you regret your role in the Iraq war?
CONDOLEEZZA RICE, U.S. SECRETARY OF STATE: I absolutely am so proud.
(END VIDEO CLIP)
ROBERTS: The outgoing secretary of state defends the decision to go into Iraq.
You're watching the Most News in the Morning.
(COMMERCIAL BREAK)
CHETRY: Give me more. That's what some are crying at the Obama camp. They're being flooded. Their inboxes flooded with e-mails weeks after the election's over. Some are saying, is this, yes, we spam? So, as the team that mastered the internet, actually raising unprecedented amount of cash on it, losing it way? Ken Vogel of "Politico" joins me now from Washington with more on this.
In your piece, and thanks for joining us this morning, Ken, good to talk to you, you quote Stephanie Salter. She's columnist for the "Tribune Star" in Indiana and she said that it's basically culturally tone deaf -- she said this to the Obama team -- to keep up the fundraising flurry while people are coping with foreclosures, job losses, no medical insurance.
What is going on? And is it politically damaging to continue this huge Web outreach?
KEN VOGEL, SENIOR REPORTER "POLITICO": Well, the Obama campaign is using this massive list of 13 million e-mail addresses that they've assembled during the campaign to try to raise money for a variety of things that aren't obviously related to the campaign because that's over.
So, they're raising money for the Democratic National Committee. They're raising money to help Senator Hillary Rodham Clinton retire her debt. And they're trying to raise money for these non-profit committees that Obama set up to help him fund his inauguration and his transition, which, it should be pointed out, would get millions of dollars in taxpayer money.
And some people are saying, hey, we signed up for this list because we wanted to help Barack Obama get elected president. Well, he's president now. Why do you keep e-mailing me, asking me for money?
CHETRY: Yes, and you also say that, you know, this once cohesive Web presence that really was the hallmark of a campaign that was able to harness the Net has sort of fragmented into this jumble. Are they fundraising? Are they activists, they're asking for money for other people? So what exactly happened?
VOGEL: Well, what happened is the campaign ended. So, all of these people who had a common goal, are now kind of going back to their lives. And the Obama campaign wants to maintain this very cohesive online community because they think it can be helpful for them going forward, both fundraising for themselves, for other Democratic candidates, for the Democratic Party, and even to help them govern. They want to be able to e-mail this list or a list comparable to it and say, do you like Barack Obama's health care plan? Call your congressman, ask them to support it.
However, there's a risk here that during this period when they are neither in the campaign nor in the White House that they're going to lose some of this cohesive nature and potentially burn out people who signed up for the list, who are either going to drop off the list or going to delete these e-mails when they come in and say, oh, not another e-mail from Barack Obama raising money.
CHETRY: And what are the legalities involved, I mean, once this transition takes place? You know, we've made a lot of the fact that once Hillary Clinton becomes secretary of state, you know, when she's -- when she's confirmed by the Senate, she will not be able to try to retire her debt at that point? But what happens, you know, to the fundraising things once Barack Obama is in the White House?
VOGEL: Well, there a number of open questions here. Barack Obama could potentially maintain his list outside of the White House, either have the campaign do it or give the list to the Democratic National Committee to continue to raise money. However, what he wants to be able to do is use it to help him govern, to be able to send out these e-mails and say, help support Barack Obama's initiatives.
In order to do that, what he needs to do is be able to transfer these e-mail addresses over to a dot gov account, an actual government account. And so, he's trying to do that in very creative ways. He's organizing these community meetings across the United States this past weekend. There were about 10,000 of these meetings. And when people go to these meetings, they are signing up for a different e-mail list through a dot gov account. And so, what Barack Obama is trying to do is make it so that these e-mail addresses can be used for multiple purposes, and it's tricky and it's unprecedented. CHETRY: These are also people that wanted Barack Obama elected and these are -- oftentimes, you know, the fundraisers are people -- are the most active, perhaps, you know, in the party. How does he then send a message that he's the president to all people and not just the 13 million who, you know, actively supported trying to get him elected?
VOGEL: Well, that's the tricky part here. And it should be pointed out, Kiran, that of that 13 million, only 4 million actually donated online. So, he not only had to reach out to people beyond the 13 million, he has to reach out to the other seven million folks who wanted to be on this list, but didn't give money and might be getting a little tired.
CHETRY: Very interesting stuff. We'll see how it all plays out. Ken Vogel with the "Politico." Thanks for being with us.
VOGEL: Thank you.
ROBERTS: It's coming up now at 30 minutes after the hour and here are this morning's top stories. Right now, Chrysler and Ford taking desperate measures to stay afloat. Starting tomorrow, Chrysler will shut down all of it U.S. plants for an extra two weeks. That's a total of a month. Ford also announcing it will close 10 of its plants for an extra week in January.
Government officials in Alaska are investigating racist jokes about President-elect Barack Obama. The jokes were circulated on state employee e-mail accounts. One offensive punch line concludes the election means, quote, "another black family living in government housing."
Sarah Palin's spokesperson said the message had "nothing to do with the governor's office."
And justice in Rwanda. (INAUDIBLE) the mastermind behind a 100 day killing spree in 1994 was convicted of genocide and war crimes today. An estimated 800,000 people were killed. The U.N. genocide tribunal also convicted two other members of the same crimes. All three were sentenced to life in prison.
The Condoleezza Rice exit interview. We usually don't see the Secretary of State open up this way, but she did and to our Zain Verjee who joins us now live from Washington. You talked to her for a long time.
And it was an interesting interview, Zain.
VERJEE: Yes, it was. It took many different shapes and tones throughout the 30 minutes. But you know, we talked a lot about Iraq and how the Bush administration really is going to be defined by the Iraq war and I also asked Secretary Rice to take a look back on the Iraq invasion and her role in it.
(BEGIN VIDEOTAPE)
VERJEE: Do you regret your role in the Iraq war?
CONDOLEEZZA RICE, SECRETARY OF STATE: I absolute am so proud that we liberated Iraq.
VERJEE: Really?
RICE: Absolutely. And especially as a political scientist. Not as secretary of state, not as a national security adviser but as somebody who knows that structurally it matters. That a geostrategically important country like Iraq is not Saddam Hussein's Iraq, that this different Iraq under democratic leadership -
VERJEE: .. totalitarian -
RICE: But look, we are at a place now where because of difficult decisions that the president took, we have an Iraq that is well on the way to being a multiethnic, multiconfessional democracy that is stable.
VERJEE: Many Iraqis will disagree with you.
RICE: Well, you only have to look at the case. You only have to look at the declining violence. Fragile, yes, but declining. And you have to ask yourself would you really rather have a middle east which you know has to be different than it has been for these many years but your really rather have Iraq with Saddam Hussein at its center. That's the other choice and I don't think that's the choice of the world.
VERJEE: What needs to happen for the world to say that the Iraq invasion was justified, positive and right?
RICE: Well, it will take some time for the effect of a change in Iraq to a friend from an implacable foe to a friend of the United States to show its effects, but when I see the Egyptian foreign minister to go to Iraq for the first time in 30 years, when I see that the Iraqis stood up to Iran despite all of Iran's efforts -
VERJEE: An Iraqi throwing shoes at the president.
RICE: Well, an Iraqi is throwing a show at the president - Let's remember again, Zain, if there was anything that was unfortunate about that incident, it was what got reported. Because as a serious scholar of international politics, do I really think that 30 years from now or 20 years from now or 10 years from now that will be a shoe being thrown at the president is somehow going to be what was important about Iraq? Of course not. And that's why when people report on today's headlines instead of history's judgment, they make a mistake.
(END VIDEOTAPE)
VERJEE: I also asked if there was anything she would do differently on Iraq, John, and she said yes. She said that she would have put a lot less emphasis on what the U.S. did in the capital Baghdad and more emphasis on what they should have done out in the provinces and working with local governments and really build Iraq from the bottom up. Rather than just focusing on Baghdad and hoping that would stabilize and build out.
ROBERTS: Yes, and certainly security problems delayed any kind of reconstruction as outlined promises. Zain Verjee for us this morning.
Great interview, Zain. Thanks for coming in. Good to see you this morning.
ROBERTS: You too.
CHETRY: And this just in. Jobless claims numbers now out. Previously 600,000 Americans filed for jobless benefits for the first time. That's the highest in 26 years.
Christine Romans has more now on what we are seeing today -- Christine.
ROMANS: Hi there, Kiran.
Well we are seeing still a number of very close to that 26 year high. A very, very slight improvement, but that improvement means 554,000 people still lined up for the first time for unemployment checks last week and more than four million people are continuing to get unemployment checks in this country. Think about it, last year we had in the 300,000 range of people every week signing up for jobless benefits. So the situation has deteriorated quite dramatically in terms of the job market.
Let me tell you where because the job market is regional too. I mean things are not quite so bad in Wisconsin, Iowa, North Dakota, Arkansas, Idaho. You had fewer people lining up for jobless benefits in those states but you saw large increases in initial claims in North Carolina, California, Georgia, Pennsylvania and Tennessee. So depending on where you are, more people might be lining up for jobless benefits than not. Let me tell you a little bit about a bright spot this morning though. The Fed yesterday as we told you there was that historic interest rate cut this week, taking the Fed funds target basically close to zero.
We're talking about zero interest rate policy essentially. After that historic rate cut, mortgage rates came down. As we told you, as lots of people have been telling you, they expect mortgage rates to come down. 5.28 percent for the 30-year fix rate mortgage and a lot of people expecting that to continue to come down. So the jobless situation still troublesome, but the one little bright spot there is that mortgage rates for people who have credit, who are solvent, that seems to be a little bit of a bright spot.
CHETRY: All right. Christine Romans for us. Thanks.
Well, his words inspired millions and the pictures will too. A sneak peek at the new book. "Yes we can." Behind the scenes of Barack Obama's historic presidential run.
And many of us love the smell of a freshly grilled burger, but on your neck? Burger King getting into the cologne business. 36 minutes after the hour.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Yes, we can. Prepare this world. Yes we can. Yes we can. Put your hands up if you think we can. Yes, we can.
(END VIDEO CLIP)
ROBERTS: John Legend and Will.i.Am at the Democratic convention last summer, performing "Yes we can," words that inspired Barack Obama supporters. It's also the name of an inspiring new book filled with behind the scenes pictures from Obama's historic run, from photographer Scout Tufankjian who joins us now.
Good to see you this morning. Congratulations to the book. I know it was a long time in the making.
SCOUT TUFANKJIAN, PHOTOGRAPHED OBAMA'S ENTIRE CAMPAIGN: Yes, two years.
ROBERTS: I was fascinated to find out though that you almost didn't go to that first event, which was a book signing in New Hampshire.
TUFANKJIAN: Yes, I ad a date that night. And I didn't want to go. My boyfriend had been out of town for two months and we were finally going to see each other again. and I didn't want to go. I didn't want to drive to New Hampshire. And at this point, thank goodness that I did. They found someone to pay me to go and you know I always need the money. So I went up.
ROBERTS: So you went up and you saw that book signing and you saw the vibe in the room, what struck you that said, that prompted that little voice inside your head to say I've got to spend the next two years of my life on the road with this guy?
TUFANKJIAN: I think seeing people's reactions to him which is something that kind of fascinated me throughout the campaign and seeing how people in New Hampshire who kind of pride themselves in being very cynical about politics and politics -
ROBERTS: Yes.
TUFANKJIAN: They've see everything. They're like we're New Hampshire. Seeing how they reacted to him you know with eyes wide open and glued to him, so excited and then seeing how he responded to it made me think that first of all he could really do it and second of all, if he did it, it would be something pretty incredible to document.
ROBERTS: I was surprised to find out that about 30 percent of the time that you were funded by somebody working for an organization and the other 80 percent of the time was self funded. TUFANKJIAN: Yes, it was really scary.
ROBERTS: You know, it turns out that a flip through the book and what went through the photographs and it turns out that my favorite photo happens to be your favorite photos as well. Let's take a look.
These young girls in Dillon, South Carolina, very economically depressed area, we've done all sorts of stories on the I-95 corridor of shame that runs through Dillon. Why was this your favorite photo?
TUFANKJIAN: It's the moment that I actually was able to capture how people reacted to him. These little girls just exploded with joy when he walked in the room. And they were so excited. They were glued to every word throughout the speech. When he talked about health care, they got really excited. And education and they were repeating what he was saying. And I think - I have been trying to capture the feeling of these effects and I think that's the time I really did.
ROBERTS: It's a tremendous amount of emotion in these photographs. And some of them too. The faces and others shots that you wouldn't normally expect. We got a couple that we want to run here. You see a pair of hands, two pairs of hand coming together. Tell me about that photo, tell me about the chalkboards and then Michelle and Barack Obama kissing.
TUFANKJIAN: OK. The hands picture is a perfect example of how lucky I am to have been covering for the campaign for as long as I have. You can pick weird angles. I am lying on my back looking up. And it's the senator or president-elect now reaching out to a supporter in Coralville, Iowa, several weeks before the caucus.
ROBERTS: Very powerful. Just the hand. The chalkboard?
TUFANKJIAN: The chalkboard. When the campaign first started, there were a lot of stories about who's going to support him and none of us knew. And so I gave people a chalkboard with a piece of chalk and I had them write down a few reasons why they supported the senator's campaign and I got their names and their ages and where they are from and it was really I did this all over the country.
ROBERTS: And everybody had a different -
TUFANKJIAN: There were a lot of people who did hope. The woman who has optimism there was in her early to mid 90s. It was just really fascinating to see what people found important all across the country.
ROBERTS: And I just wanted to mention the kiss, too. Because they are not shy about displaying affection.
TUFANKJIAN: No.
ROBERTS: Is it genuine? Because some people wonder with all the cameras. TUFANKJIAN: I think so. I mean, you know, no one can actually know the answer to that question but them, but I really think it is. They seem to be very good at finding private moments in the middle of these public - everyone is cheering them kissing which has got to be really strange. But yes, I think it is genuine.
ROBERTS: Well, it's a great book. Thanks for coming in to talk about it.
TUFANKJIAN: Thank you so much.
ROBERTS: Good luck and congratulations.
TUFANKJIAN: Thank you.
ROBERTS: Good to see you.
CHETRY: Well the school ban that has a great gig playing at the inauguration. We're going to meet the kids who are going to be part of presidential history. It's 43 minutes after the hour.
(COMMERCIAL BREAK)
CHETRY: Members of a marching band from Brooklyn getting ready for the performance of their lives. They have been picked to play for President Obama down at Pennsylvania Avenue at his inauguration. AMERICAN MORNING's Carol Costello has their inspiring story.
Hey, Carol. Talk about nerves.
CAROL COSTELLO, CNN CORRESPONDENT: Nerves, yes. And excitement too. You know, not just Brooklyn but kids all over America worked really hard to get the nod. For example, in Atlanta, the South Cub High School band sent 15 letters of recommendation, a scrapbook put together by students expressing their patriotism and a DVD of their performance. They were the chosen ones and of course so were dozens of others from Georgia to California to D.C. to New York.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: One two play and -
COSTELLO (voice-over): Music. It is a powerful thing. It can take kids off the mean streets of crime plagued Bedford Stuyvesant.
TYRONE BROWN, BROOKLYN STEPPERS BAND DIRECTOR: So instead of bats and guns, we have trumpets and trombones and drums.
COSTELLO: And into a world of music where dreams really do come true. Donnell Tribble plays the snare drum.
DONNELL TRIBBLE, BROOKLYN STEPPERS BAND: I was like what, inauguration and so I automatically ran home, I race and just told my parents, my family, everybody. Everybody was just excited for us.
COSTELLO: The Brooklyn Steppers marching band will play for Barack Obama on inauguration day. They are confident, but a little nervous too. After all, they are practicing a song they are sure Obama will love. It was written by one of his favorite artists, Stevie Wonder.
Talk about pressure. Getting it right is all important.
CHIONESO "CHI CHI" BAKR, BROOKLYN STEPPERS BAND: Don't mess up. Play the right notes. Don't play too loud. Don't play out of tune. You are playing for the president. So it's important.
COSTELLO: The Brooklyn Steppers will not be the only high school band under pressure. Dozens of others will be too. Including Washington, D.C.'s Dunbar, another predominantly African-American school.
SHARNITA JAMES, DUNBAR HIGH SCHOOL BAND: We will try hard and give our all. Lift our legs higher. Blow as hard as we can and just go all out.
COSTELLO: From the very minute Barack Obama won the presidency, they dreamed of this moment.
MONIQUE POLARD, DUNBAR HIGH SCHOOL BAND: This is once in a lifetime. I have never seen nothing like this before. It's history. This is really history.
COSTELLO: There's pride back in Brooklyn, too.
SIMONE PETTAWAY, BROOKLYN STEPPERS BAND: I want to meet him and shake his hand, you know, and asked him what inspired him.
UNIDENTIFIED MALE: The thought of Obama being African-American and this being the first African-American president of the United States and makes it even more of a dream.
COSTELLO: See music is a powerful thing and some dreams really do come true.
(END VIDEOTAPE)
COSTELLO: I cannot tell you how excited they are. It was amazing Kiran to see how meaningful this was for students. They are really involved, they followed the election and they know their stuff. Of course, they just took the passion for politics last because we're going to need them in the future.
CHETRY: Absolutely. Well good luck for them. You know. They're going to get their little reads out, you know, they're playing the clarinet and they got to get their lungs ready if they do the tuba. So good for them.
COSTELLO: And it's going to be so cold out there, but they are not thinking of that yet.
CHETRY: Oh, I forgot. Maybe, you never know. We could get lucky and get an Indian summer out of it and have a nice day. Who knows.
COSTELLO: Wouldn't that be great?
CHETRY: Why? I'm trying to be positive.
ROBERTS: Indian summer.
CHETRY: It's January 20th, but you never know.
ROBERTS: Either way. It's going to be heck of an event. Carol, thanks. Great to see you.
New jobless numbers out this morning. Not as bad as the week before. Still bad though. What do you do though if you are among those receiving the pink slip. Unemployment benefits can be very confusing. Gerri Willis is answering your blog questions. In her "Layoff Survival Guide," we just got that coming up.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
RON LIVINGSTON, ACTOR, "OFFICE SPACE": I have eight different bosses right now.
UNIDENTIFIED MALE: I beg your pardon.
LIVINGSTON: Eight bosses.
UNIDENTIFIED MALE: Eight?
LIVINGSTON: Eight, Bob. So that means that when I make a mistake, I have eight different people coming by to tell me about it. That's my only real motivation is not to be hassled, that and the fear of losing my job but you know, Bob, that only makes someone work just hard enough not to get fired.
(END VIDEO CLIP)
ROBERTS: A classic scene from the movie "Office Space." Bad enough to be let go but losing a job in the midst of an economic crisis means it may take even longer for you to find a new one.
CHETRY: Yes, so how do you cope? First of all, finance editor Gerri Willis joins us now with the next segment in your series, "Layoff Survival Guide."
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Yes. We got some great questions and all over the map here about unemployment and what to expect. Listen to the questions from Zack in Florida. He says "I graduated college in 2006 with a bachelor's degree in business management. I've changed jobs five times in a little over three years. How negative will that look to potential employers?"
Well, Zack, I got to say it's not the best in the world. It makes it look like maybe you are not really that serious, but you know what you have to be your own public relations person here. You're going to have to spend this information. I think for you to say in an interview is that I have a lot of experience with a lot of different employers. I've seen the industry from all sides. And guess what. I have a lot of experience. That's the way I would spend that.
The next question comes from Yvet in Louisiana who said "if someone receives severance that is paid over a few months, does that person still qualify for unemployment?" Devils in the details here that in some states they are, in some states they are not. In some cases if you have a small severance package, it might reduce your say unemployment for a little while but severance package, it might reduce your take from unemployment for a little while but not entirely. Go to the department of labor's Web site. Check out their link to individual state programs. That's where you'll find out where you're going to be eligible for.
And finally, let's see Griffith in Indiana asks, "what is the definition for people who aren't eligible for unemployment and why are people who can't find work for eight months consider giving up and no longer working?" OK. Well we put that to the Department of Labor and let them answer that question. They say -
ROBERTS: This is interesting.
WILLIS: They say no part of the unemployment rate is based on whether people receipt jobless benefits. They say all we care about is whether you are available for work, you were not employed and is trying to get work. They say that where it's based on. You know, I know there's a lot of concern out there that people are falling off the roads and the numbers are far larger than the government is stating. Devils in the details here. Again, we put it to the Department of Labor -- that's what they have to say about their numbers and how they calculate them.
ROBERTS: All right. And how do they calculate that? How do they know if somebody -
WILLIS: You know they use census numbers. That's what I was told.
ROBERTS: but they're 10 years old.
WILLIS: He says they use the current population study. So I don't think they're using 10-year-old data. I think they're using something that's in between those two benchmarks.
ROBERTS: Moderate projection though, isn't?
WILLIS: Well everything is projection.
ROBERTS: Gerri, thanks so much for that.
WILLIS: My pleasure.
ROBERTS: 54 and a half minutes after the hour now.
Flame in a bottle.
(BEGIN VIDEO CLIP)
JEANNE MOOS, CNN CORRESPONDENT: Would you want your man to smell like a burger.
UNIDENTIFIED FEMALE: I wouldn't, no.
(END VIDEO CLIP)
ROBERTS: Jeanne Moos talked to the streets with Burger King's bizarre new cologne. Does the scent sizzle or fizzle.
You're watching the most news in the morning.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: It's called six panther by Odian, the leader of nine countries.
UNIDENTIFIED MALE: Yes, it's made of bits of real panther. So you know it's good. It was a formidable scent. It stings the nostrils in a good way. Yes, I'm going to be honest with you. That smells like pure gasoline.
(END VIDEO CLIP)
ROBERTS: Well we might not be able to find six packs of good ladies if you're still looking for stocking stuffer for the guy in your life. It's hard to go wrong with a little bit of cologne especially if it reminds them of standing in front of an outdoor grill flipping burgers.
Our Jeanne Moos explains.
(BEGIN VIDEOTAPE)
MOOS (voice-over): We all heard of -
UNIDENTIFIED FEMALE: Obsession.
MOOS: Or maybe even --
ANNOUNCER: Poison.
MOOS: But now this is flame, flame, flame from Burger King.
Come on baby. Give it a spray. Flame is a scent of seduction with a hint of flame-broiled meat.
UNIDENTIFIED MALE: I don't think smelling like a burger is too cool.
MOOS: On the other hand what other men's cologne costs $3.99, less than the price of a waffle value meal. Burger King's flame sold us firemeetsdesire.com where you also meet the Burger King king (INAUDIBLE) beckoning you to his bare rug. But let's see a flame passes the smell test?
Will you smell Ian here. We drenched CNN associate producer, Ian Orifice (ph) in Flame. Smell Ian if you would.
The flame got OK reviews. The hint of flame broiled meat seemed lost on folks. Does Ian smell like this?
UNIDENTIFIED FEMALE: No.
MOOS: Does it smell like this.
UNIDENTIFIED FEMALE: Oh god, no.
MOOS: Only a few people detected anything remotely resembling that charbroiled scent.
UNIDENTIFIED FEMALE: Oh, my god. A little. That is sick. Almost like a gasoliny edge which probably makes it smell like the charbroiled.
MOOS: A little gasoline.
(CROSSTALK)
UNIDENTIFIED FEMALE: That smell has less calories.
MOOS: Frankly, Flames seems to be a Whopper of an advertising gimmick.
McDonald's joked about the same concept in a Super Bowl ad featuring a distracted husband reaching for one of those dryer fresheners and popping them in a McDonald's wrapper but mistake.
The result. But seriously folks, would you want your man to smell like a burger.
UNIDENTIFIED FEMALE: I would not.
UNIDENTIFIED FEMALE: He already does.
MOOS: He does?
Maybe the only one who would want to smell like a burger would be say the dog catcher. Some misunderstood Flames purpose.
UNIDENTIFIED MALE: They spray this on the burger?
MOOS: Not if you expect to survive eating them. That wouldn't be flame. That would be --
UNIDENTIFIED FEMALE: Heartburn.
MOOS: Jeanne Moos CNN New York. (END VIDEOTAPE)
ROBERTS: (INAUDIBLE)
CHETRY: Yes. My dad is looking for a new scent for Christmas. Maybe I just got the ticket.
ROBERTS: There you go. Smells better probably than a lot of stuffing.
CHETRY: Wait until you're being chase on the street by dogs, that's the only problem.
ROBERTS: That's got to wrap for us. Thank you so much for joining us on this AMERICAN MORNING. We'll see you bright and early again tomorrow.
CHETRY: Yes. Sure will.
Right now, here is "CNN NEWSROOM" with Heidi Collins.
