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Economic Stimulus Package; Interview With Mayor Michael Bloomberg; Historic Flooding in Washington State; Strikes From Lebanon; Economy in Crisis; Closeup of Conflict; Travel Troubles; Hopeful About the Economy
Aired January 08, 2009 - 12:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
TONY HARRIS, CNN ANCHOR: And hello again, everyone. I'm Tony Harris in the CNN NEWSROOM.
And here are the headlines from CNN for this Thursday, the eighth day of January, 2009.
The president-elect spelling out his plan to revive the economy. He says unless Congress moves fast, the consequences will be devastating.
A show of support for Hamas. Militants in Lebanon fire rockets into northern Israel, while the fight in Gaza rages on.
Danger in Washington. The state braces for what may be historic floods brought on by relentless rain and melting snow.
An urgent call for action to rescue an economy in crisis. President-elect Barack Obama just wrapped up a speech last hour, making his case for a massive economic stimulus package -- he says the current recession could linger for years without dramatic action -- as soon as possible.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT-ELECT OF THE UNITED STATES: We are still the nation that has overcome great fears and improbable odds. If we act with the urgency and seriousness that this moment requires, I know that we can do it again.
And that is why I have moved quickly to work with my economic team and leaders of both parties on an American recovery and reinvestment plan that will immediately jump-start job creation and long-term growth. It's a plan that represents not just new policy, but a whole new approach to meeting our most urgent challenges.
Now, I understand that some might be skeptical of this plan. Our government has already spent a good deal of money, but we haven't yet seen that translate into more jobs or higher incomes or new confidence in our economy. And that's why the American recovery and reinvestment plan won't just throw money at our problems. We'll invest in what works.
The true test of policies we'll (ph) pursue. It won't be whether they're Democratic or Republican ideas, whether they're conservative or liberal ideas, but whether they create jobs, grow our economy, and put the American dream within the reach of the American people.
(END VIDEO CLIP)
HARRIS: The president-elect trying to convey the urgency of the crisis and convince critics that his stimulus plan is the way to go.
Our Senior White House Correspondent Ed Henry was there for the speech in Fairfax, Virginia.
And Ed, a number of elected officials in the hall for that speech. My understanding is that you are standing with one of the most prominent politicians in the country at this moment.
ED HENRY, CNN SR. WHITE HOUSE CORRESPONDENT: That's right, Tony. We've got one of the most prominent politicians in the country. He's the mayor of New York City, Michael Bloomberg, at one time a Democrat, then a Republican. Now he's not affiliated with any party, so who better to ask from sort of an independent perspective?
You were in the front row, but then you went behind -- you know, back stage with the president-elect, with other mayors. How do you think he did?
MAYOR MICHAEL BLOOMBERG (I), NEW YORK: I think he gave a great speech. It's the opening salvo in what will be a long, difficult battle for him to try to reform the way this country spends money and get the economy going again. And I think he referenced that.
He understands that there are lots of vested interests, and he said we can't do things the way we've been doing it. Understand that. Now he's going to have to lead the charge to do that change, and nothing's going to get done without both ends of Pennsylvania Avenue and both sides of the aisle.
HENRY: Now, you've run a business, you now run a city. You've got to meet a budget. You told me a moment ago, the devil, though, will be in the details.
How does he do it on top of a $1.2 trillion deficit? Now he wants to spend about $775 billion to try to bring the economy back. How do you make all that work?
BLOOMBERG: Well, I think it's been a decision made by the financial experts, that what is worse than not spending an extra trillion dollars we don't have is spending it. We have no choice but to ratchet up the deficit at the moment, and the president-elect referenced that and said he'd like to do things that have a life span where there's an end to it, so that he can then address that issue and bring down the deficits in the future.
He said deficits do matter. But at the moment, there's just such lack of confidence in the economy in this country, people are afraid that they're going to lose their house even if they don't. People are afraid they're going to lose their job, even if they don't.
And so what they've done is they've stopped spending. And when they go to a restaurant, they buy a hamburger rather than a steak. They buy a glass of wine rather than a bottle of wine. They make that car last one more year. That's not good for the economy even if it's good common sense when you're going into a difficult period.
HENRY: But he's trying to instill more confidence by spending some money in the short term. Let's get into the specifics though.
As a mayor, what are the two or three top priorities you have that you actually think would be stimulative? A lot of economists were wondering. You can't just spend, you know, good money after bad. What two or three priorities, for you, would actually get the economy moving again, do you think?
BLOOMBERG: Well, ,one thing is we have to invest in infrastructure. Now, the trouble with infrastructure is it takes a long time to have that filter through the economy and give us the financial oomph that we need, but there are projects at the city level, basically not at the state level, but at the city level, and we've made the case to his staff that a lot of this money should go to the cities.
If it goes to the state, it gets spread very thinly, and the states don't really do things. It's the cities that do things. Eighty-five percent of the people in this country live in cities. And we've got to get some money down there. But there are projects that are ready to go, that will give us the infrastructure of the future.
If you go back, you know, Lincoln worked on the railroads. Jefferson worked on the canals. Roosevelt worked on municipal buildings and airports and that sort of thing. Eisenhower worked on a national road system.
Those gave us with financial and the structure we needed to go forward for decades. The trouble is, it just takes a long time to get them going. And an awful lot of the people that are getting laid off can't drive backhoes. So it's not a panacea infrastructure, it is one of the things.
We have to go and take a look. You can reform the school system, use this as an opportunity to make the changes to improve public education, not just keep throwing money at the same things we've been doing.
And that will be the great challenge, getting that through a Congress that is beholden to people who have supported it in the past. And, you know, Congress is reluctant to make change. They like spending money, but they don't want to have to make the changes that are necessary.
And if you take a look at a city like New York, we're losing people in retail, we're losing people in restaurants, we're losing people in offices. Finding jobs for those people, job training will help, encouraging small businesses will help, making sure the banks will make mortgage loans and business loans. Although, you've got to be careful. We're going to encourage them to make loans when the crisis we've had is because they did make loans to people who couldn't pay it back.
HENRY: Sure.
Last quick question. He didn't really get into entitlement spending today. Yesterday, he mentioned Social Security and Medicare at a press conference, but said he'd have more details in February.
If you're going to get your arms around the budget, the federal budget -- but it trickles down everywhere, as you know as a mayor -- what needs to be done in Social Security and Medicare, these monster programs that keep growing?
BLOOMBERG: Well, Social Security is one of these Ponzi schemes. We spend more money than we take in, and there's an old joke that Bernie Madoff got the idea from looking at Social Security. But that's a much longer-term thing.
The problem, for example, with health care is we can't afford it, and the quality of our health care is not what it should be. In Europe, they spend $2,000 or $3,000 per capita less and have a life expectancy of two or three thousand (sic) years more.
So somebody's got to take a look at why is -- what's the quality of our health care? I know not everybody's covered, but just with the money we're spending, we're not getting good value.
And the study that we're releasing today, Schwarzenegger and Rendell and myself -- we have a group called Building America's Future -- shows the public wants accountability. There's a good place to start.
HENRY: I appreciate it, Mr. Mayor. I know you have a plane to catch.
BLOOMBERG: All the best.
HENRY: Tony, you heard it there from Michael Bloomberg. He basically feels like it was a strong sales pitch. But again, there's a lot more detail that needs to be laid out in the short term to get it through Congress. But in the long term, to sell this to the American people as a recovery plan that's going to be a genuine recovery plan and actually get the economy turned around -- Tony.
HARRIS: Yes, Ed. I had a couple of questions for you, but the mayor can go on a bit. But we'll talk again real soon, I'm sure. All right.
And our thanks to Mayor Bloomberg.
And thank you as well.
Today's speech by Barack Obama, short on specifics about the economic stimulus plan.
For more perspective on it, let's bring in a member of our CNN money team, Christine Romans, live from New York. Christine, good to see you.
CHRISTINE ROMANS, CNN CORRESPONDENT: Tony, I loved the Ponzi scheme Social Security reference. I was just talking about that with Ali earlier.
HARRIS: Well, that's the idea of money just being moved around, that the Social Security fund is not solely dedicated to what it's supposed to be doing. And that money is moved around all the time to take care of other needs by -- true, correct?
ROMANS: Mayor Bloomberg is saying something that I've heard people been telling me all week, that Bernie Madoff, this Bernie Madoff scandal, what's he doing any differently than the United States government in the Social Security system?
Now, there are serious economists who say, come on, it's not exactly the same thing. But the idea is that we're paying right now into a fund that's paying today's investors their money back.
HARRIS: Yes.
ROMANS: Isn't that sort of the same thing?
What the challenge is for the president-elect here is he's got to address these big-picture issues, and it's going to be some sort of combination of raising our taxes, raising our retirement age, lowering our benefits, doing something that's going -- there's going to have to be a cutoff where there's the old Social Security and the new kind of Social Security. And that's political suicide.
This president laying the groundwork for some very, big, big issues that he's going to have to tackle. And maybe, just maybe, this near-term financial crisis, this debacle we're in right now, will give him some political cover to fix these other problems that have been lingering along for years.
HARRIS: Yes, good point.
You know, I'm curious, as we take a big step back here for just a second, Christine, the atmospherics of this, from where you sit and with the people that you talk to in your reporting on a daily basis, how high a mountain does the president-elect have to climb to restore confidence in the markets? And I'm talking about from everyday consumers to the institutional investors.
ROMANS: He can't climb the mountain. He's got to get in the helicopter and go to the top.
HARRIS: Wow. And start there, yes.
ROMANS: I mean, it's not something that we've ever seen before. And you can't overstate just how difficult it is.
It's going to take -- you know, I mentioned before, it was a very eloquent 20 minutes or something, but eloquence isn't going to do it. It's going to have to be leadership.
He can tell Congress, look, put your partisan differences aside. Together, we have to do this for the sake of the country. But every crisis we say that.
HARRIS: Yes.
ROMANS: And there's still the partisan differences. I mean, he's really going to have to lead. His team is going to have to make the right set of choices.
There will be some mistakes. There are really serious people, people who are serious about government waste who say, you know, there's going to be government waste in here, there are going to be things that aren't going to work. But, you know, we can't afford to not do something because we think it might work. We have to do everything we can to turn the economy around.
HARRIS: Yes.
ROMANS: I mean, you know, people are losing sleep over this...
HARRIS: Good point. Good point.
ROMANS: ... thing here, and the president's really got a tough road.
Now, you know, Ed had made a couple of good points, too, about the devil's in the details, and we just don't have the details yet. I mean, I'm sure that they're working them out.
Some of those details are going to be -- you're going to get in the weeds when you're talking about some of the real -- you know, I don't know if you can go in front of the American people and start talking about some of the very technical things that they want to do, but they're going to have to come out with a real specific blueprint here very, very soon.
HARRIS: That's right.
Terrific. Thank you, Christine, as always.
ROMANS: Sure.
HARRIS: An economist weighs in on the speech by the president- elect and the stimulus plan. Peter Morici of the University of Maryland says infrastructure spending is the way to go, and he joins us at the half-hour.
Confirming the new cabinet. President-elect Barack Obama's pick for Health and Human Services secretary Tom Daschle is the first to face the confirmation process.
(BEGIN VIDEO CLIP)
TOM DASCHLE, HEALTH AND HUMAN SERVICES SECRETARY NOMINEE: The flaws in our health system are pervasive and corrosive. They threaten our health and economic security. And that is why the president-elect has crafted the new White House Office of Health Reform, and I'm honored to have been chosen to serve in this role as well. If confirmed, I will use these dual roles to marshal the talent and energy necessary to at last succeed in making health care affordable and accessible for all Americans.
(END VIDEO CLIP)
HARRIS: The former Senate majority leader answering questions posed by Senator Ted Kennedy's Health, Education, Labor and Pensions Committee.
The confirmation hearing for secretary of state nominee Hillary Clinton is scheduled for next Tuesday.
President Bush is touting his No Child Left Behind program in a visit to Philadelphia this morning. The policy was enacted seven years ago.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Seven years ago today, I had the honor of signing a bill that forever changed America's school systems. It was called the No Child Left Behind Act.
I firmly believe that thanks to this law, more students are learning and achievement gap is closing. And on this anniversary, I have come to talk about why we need to keep the law strong. If you find a piece of legislation that is working, it is important to make sure the underpinnings of that law remain strong.
(END VIDEO CLIP)
HARRIS: Well, some critics say the program has not hit its potential due to underfunding.
And how about this? Just a messy, muddy situation in western Washington State today. Fifteen inches of rain and melting snow are creating what may be an historic flood situation.
Thirty thousand people have been asked to move to higher ground as 19 rivers move toward major flood stage. The video on the right is the rubble of a house that slid down a hill. The homeowner was inside at the time enjoying her fireplace. She wasn't hurt in the ride down the hill, but says she thought this was the end.
The National Weather Service says that Chehalis River could reach record levels tonight.
KPTV reporter Mark Glyzewski is in Centralia, Washington -- that's a mouthful -- about 50 miles south of Tacoma.
And Mark, if you would, wow, describe that scene around you.
MARK GLYZEWSKI, REPORTER, KPTV: Well, you're looking at Interstate 5, Tony, behind us here. And this is really the scene you're going to see along a 20-mile stretch off and on, scattered flooding like this, where the roadway is completely covered by water. And that's why the Washington Department of Transportation has shut down this 20-mile stretch.
Again, this is a main artery between Portland and Seattle. So you talk about planes, trains and automobiles? The only way you're only going to get through to Seattle is by air, because Amtrak also shut down due to the flooding along the railway line there. Also, hundreds of people out of their homes who live in this flood plain as well.
How long it's going to be this way? Still don't know. It's going to linger like this throughout the weekend. The earliest prediction that we're getting is that this possibly could reopen, I-5, on Monday. That's how extensive the flooding is here -- Tony.
HARRIS: Mark, give us a total on evacuations. How many people are impacted? The loss of power in that area?
GLYZEWSKI: Yes. Right now, we're talking about hundreds.
HARRIS: Yes.
GLYZEWSKI: We're still trying to get a total on the number of people involved. But to give you an idea, too, of the widespread flooding not just involving the interstate here, but there's an area over the way here I want to show you. There's some baseball fields over there.
Check out the water line there, right up to the top of those dugouts. It gives you an idea just how high the water is in the low- lying areas here.
Again, this is all in the wake of some heavy snow we had a few weeks ago.
HARRIS: That's right.
GLYZEWSKI: Then it all thawed out. Then we had heavy rain, so now you have this big mess.
HARRIS: OK.
Mark Glyzewski for us in Centralia, Washington, with our affiliate there, KPTV.
Mark, appreciate it. Thank you.
(WEATHER REPORT)
(COMMERCIAL BREAK)
HARRIS: Israel, fighting to halt rocket attacks on its southern side, now hit with rockets from the north. Militants in Lebanon apparently showing solidarity with Hamas. Live now to our Cal Perry in Beirut.
And Cal, look, I have to ask the obvious question here -- is Hezbollah trying to interject itself into the current crisis?
CAL PERRY, CNN INTERNATIONAL CORRESPONDENT: No, I don't think so at all, Tony.
HARRIS: OK.
PERRY: And I mean, you know this region as well as anybody. We all kind of leapt out of bed at 7:15 this morning when we had heard that these rockets had been fired into northern Israel. It was four rockets fired from southern Lebanon into northern Israel. And the question on everybody's mind, of course, was, is this Hezbollah?
Well, within just a few hours, we heard from the Information Ministry, who had spoken to Hezbollah. Hezbollah had told them they had nothing to do with this.
When you look at Lebanon, the country, you have to realize there are 400,000 Palestinians that live in Lebanon in 12 different refugee camps across the country. There are very powerful Palestinian groups in the southern part of the country. It looks as though one of those groups was responsible for firing the rockets.
The prime minister has denounced this rocket attack. The Lebanese prime minister, that is. And he also denounced the Israeli response.
The Israelis, for their part, of course, have artillery lined up along that border -- they have since 2006 -- and immediately responded to that rocket fire. But everybody's concern, at least for now, seems to have abated that this could have turned into something far worse, something more regional, something like what we saw in 2006 between Hezbollah and Israel.
HARRIS: Absolutely.
OK. Cal Perry for us.
And Cal, if you get any more information on this, just give us a heads up.
A major retailer slashes hundreds of jobs after one of the weakest holiday shopping seasons in decades.
(COMMERCIAL BREAK)
HARRIS: New jobless benefits numbers are out today. The Labor Department says the number of new claims dipped last week. That wasn't expected. Still, the number of those continuing to file for unemployment benefits has risen to a 26-year high.
Economists are predicting more dismal news when the December jobs list comes out. That's expected -- that's tomorrow. Some Macy's employees likely to be among those filing for unemployment benefits. The retailer announced today it will close 11 stores in nine states. The closings affect about 960 workers. Macy's says its sales in December fell 4 percent. The retailer also is lowering its forecast for the fourth quarter due to those big markdowns.
Gas prices edging up. Doing more than edging up.
AAA reports the current average is $1.76. That's up three cents from yesterday and up six cents from a month ago. But consider this -- one year ago, that gallon of unleaded regular was $3.10.
I'm still not happy with the trend here.
Still to come, he had seen graphic images while covering the war, but nothing could prepare a Gaza cameraman for the seen he saw at home.
(COMMERCIAL BREAK)
HARRIS: All right. A look at the New York Stock Exchange. And the Big Board, of course, as you can see, just at the three-hour mark in the trading day.
The Dow is down 84 points. The Dow has been in negative territory throughout the day. Who are we kidding here? The Nasdaq is essentially flat, down 3.
We will keep an eye on the markets, of course, for you throughout the day, right here in the NEWSROOM.
President-elect Barack Obama issuing an urgent call to action to pump up an economy in crisis. In a speech last hour, he warned of devastating consequences if Congress doesn't act soon.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT-ELECT OF THE UNITED STATES: We should have an open and honest discussion about this recovery plan in the days ahead. But I urge Congress to move as quickly as possible on behalf of the American people. For every day we wait or point fingers or drag our feet, more Americans will lose their jobs. More families will lose their savings. More dreams will be deferred and denied. And our nation will sink deeper into a crisis that at some point we may not be able to reverse. That is not the country I know. It is not a future I accept as president of the United States.
It's time to trade old habits for a new spirit of responsibility. It's time to finally change the ways of Washington so that we can set a new and better course for America. There is no doubt that the cost of this plan will be considerable. It will certainly add to the budget deficit in the short term. But equally certain are the consequences of doing to little or nothing at all. For that will lead to an even greater deficit of jobs, incomes and confidence in our economy. (END VIDEO CLIP)
HARRIS: OK. Some insight and perspective now on the speech by Barack Obama and that massive stimulus plan. Peter Morici is an economist and professor of international business at the University of Maryland.
Peter, good to see you again. Thanks for being with us for both hours today.
He is with us from Washington, D.C. And our senior White House correspondent, Ed Henry, is in Fairfax, Virginia, where the president- elect spoke last hour.
And, Ed, let me start with you.
I was struck by something we both felt by -- as we were watching the speech, how much it sounded like a speech Barack Obama could have given during the campaign. What else stood out to you?
ED HENRY, CNN CORRESPONDENT: That did stand out, Tony, because I think he's trying to find his voice, you know, from the campaign. The transition sort of changes things in so many ways, obviously. He's trying to maybe get the little bit of that momentum that he had months ago and bring that sort of campaign-style energy to the fight ahead because, let's face it, the transition's all about sitting back a little bit.
We've heard over and over the one president at a time thing. He's been assembling his cabinet, his senior staff. Sort of getting ready for that big battle ahead. But you're not quite president yet. You don't quite have the power. So what you almost saw, I think, was trying to psych himself up, if you will, for the battle ahead. And let's not understate it, it's going to be a monumental battle.
This is the president-elect, as incoming president, his first big test of how much clout does he have. Does he have the juice to get the Congress to pass this massive economic recovery plan. He certainly has some advantages. He's got enhanced majorities in the House and Senate, more Democrats. He's got some Republicans who came out of a very tough election loss and are now trying to show they can work with this new president rather than fighting him at every turn right out of the box. Nevertheless, he's going to face some tough questions about the price of this and the details of all of this.
Tony.
HARRIS: Yes, Ed, you talk about the sales approach to this. And this is, I mean let's be honest about it, a massive sales job. I'm looking at a note here. You've got the president-elect's speech this morning. I believe you've got Larry Summers scheduled to brief Senate Democrats. The's probably happening later this afternoon. The Senate Finance Committee holding its first meeting on the emerging details.
What do we think so far of the strategy and tactics as various parts of team Obama are dispersed, really, to start to sell this plan? HENRY: You're right. It is a sales pitch and the strategy is clear. Have the lead person, the president-elect, who's good at these kinds of speeches, even his critics acknowledge, lay out the broad brush, the broad principles about what he thinks needs to be done. And then you get some of the hands-on people like Larry Summers, the incoming head of the National Economic Council, somebody very highly respected in that area, Tim Geithner, the outgoing head of the New York Fed, incoming Treasury secretary if he's confirmed by the Senate. Have them fan out to The Hill, lay out some details and get the ball rolling. But you don't get the president-elect himself sort of mired in the weeds, if you will. Let him fly at the 30,000 feet and give that sort of soaring rhetoric again that we saw in the campaign.
But they still have to fill in the blanks on all of this and they have to convince some skeptical lawmakers that on top of a $1.2 trillion deficit, now is the right time to spend $775 billion. You heard me or Michael Bloomberg a few moments ago say, yes, you're going to add to the debt, but you need to do that in the short term in order to try to turn the economy around. Obviously the great fear that a lot of lawmakers have is that if this bill does pass, gets signed into law, what if it doesn't work? What if it doesn't have the kind of impact the president-elect expects and wants. Then what's plan b? I mean that's for another day to talk about, but it is a monumental fight ahead.
Tony.
HARRIS: We'll have that conversation with you. Senior White House correspondent Ed Henry with us. Ed, appreciate it. Thank you.
Let's bring in Peter Morici.
Peter, again, I'm just sort of trying to read your reaction to it. So let me just ask you straight out, what was your reaction to the speech? I know that in part you believe that the president-elect should really focus a lot of this stimulus on infrastructure.
PETER MORICI, ECONOMIST: Well, he certainly outlined an enormous infrastructure agenda. Just not roads, bridges, schools, and highways, but also the Internet, healthcare information systems, alternative energies, renewing the power grid. Things of that nature. That has an enormous price tag going out to many years. My feeling is we'd be better off skipping the tax cuts or only having a little bit of it in the second quarter to make people feel good, but leveling with the American people. This is a big price tag deal. We really can't be cutting taxes. We need to spend the money directly to create jobs.
HARRIS: I'm just wondering, do you believe that the plan builds even more momentum? I think there's pretty much wide consensus that a plan is needed. I'm wondering how this speech looks to us tomorrow, how efforts to move forward on a plan are shaped by the data as it comes in, for example, the unemployment numbers, the jobs report tomorrow.
MORICI: I don't think there's going to be a lot of surprises in the data over the next two or three months. It's going to be pretty bad. Does it really make a difference from the point of view of shaping this program, whether we lose 500,000 jobs in December or 600,000? They're both terrible numbers. We need to spend some money and spend it quickly. That's acknowledged.
The question is, beyond that. What happens after the money's spent? Does the economy fall back in the drink (ph) or does he make the structural changes necessary to get the economy on a long-term growth path. He referred to the need to do that, but he didn't say how he was going to get it done. In order to get that done, he's got to fix the bank, which is more of a cultural problem than a regulatory problem. Wall Street is adequately regulated. It has lots of lawyers who know how to get around it. It's like tax lawyers.
But there's also the trade deficit. The excessive consumption of gasoline and imported oil, which his energy initiatives don't address. And there's the problem with trade with China, which, like President Bush, he doesn't seem to want to address. He seems to be avoiding that issue. If we don't fix the trade deficit, there will continue to a shortage of demand for domestic goods and services, we'll need one stimulus package after another, which will require us to borrow more and more from foreigners.
HARRIS: Boy, with that list, who would want the job, Peter?
MORICI: Well, my feeling is, this is not that undoable.
HARRIS: OK.
MORICI: My feeling is, this is a doable project. That these are things that need to be done, that we've been putting off, that we know how to do. And if this guy's willing to roll up his sleeves and disappoint some people, we can get it done.
HARRIS: There he is, Peter Morici. Always a joy to have you on the program. Peter, we appreciate it again. Thank you.
MORICI: Take care.
HARRIS: All right. We asked for them and you sent them. Your reaction and comments regarding the economy and the president-elect's speech. Josh Levs will have your e-mails just ahead.
All right. And this story we want to get to you just before the break. An investigative panel of Illinois lawmakers may be close to recommending impeachment for Governor Rod Blagojevich. A draft of a possible impeachment ruling was posted on the state house Web site today. FBI agents arrested Blagojevich December 9th after federal prosecutors alleged he tried to sell or trade President-elect Barack Obama's former Senate seat. Blagojevich denies wrong doing and has ignored calls to resign.
Meanwhile, former Illinois Attorney General Roland Burris getting ready to appear before that same committee. Yesterday, in Washington, Burris denied he secured his U.S. Senate appointment through some kind of pay-to-play politics. Burris and Governor Blagojevich both say his appointment is legal.
Day 13 of Israel's assault on Gaza. The Israeli military intensifying its air, land and sea assault. Palestinian medical sources say the death toll has jumped to 763. Israel reports three civilians and eight soldiers killed. The rising casualty count forcing diplomats to step up peace efforts. Egypt hosing representatives from Israel and Hamas. The two sides agreeing to talk, but not to one another. The U.N.'s main aide group in the region is suspending relief work. A U.N. spokesman says one of its truck drivers was killed by an Israeli tank shell while trying to bring in aide.
A freelance cameraman captures pictures of the war in Gaza, including one image that will stay with him for the rest of his life. CNN's Michael Holmes reports.
(BEGIN VIDEOTAPE)
MICHAEL HOLMES, CNN CORRESPONDENT, (voice over): At a Gaza hospital, doctors trying to revive a victim of the violence. Their efforts in vain. Twelve-year-old Mahmoud (ph) is dead. Recording the tragedy, Mahmoud's own brother, freelance cameraman Ashraf Mashwari (ph), determined, he says, to show the world the human cost of this conflict. A short time earlier, Ashraf had been filming other less personal images of the war. The incoming missiles. The damage they do.
And then he got a phone call. The family home had been hit by a rocket. Fired, says the family, from a pilot-less Israeli drone. After the vain efforts of the doctors, Mahmoud is taken home, cradled in the arms of the grieving family. Ashraf continues to film. The family, he says, wants the world to know how his little brother died.
The family says they felt their home was safe. No reason for it to be hit from the air. Ashraf says there were scores of women and children here. And after days of being cooped up in the crowded home, Mahmoud and his 14-year-old cousin, Ahmad (ph), were allowed to play on the roof. Now pockmarked (ph) by shrapnel and spattered with blood. Both boys were killed.
ASHRAF MASHWARI: The Israeli plane targeted him with a small rocket for them (ph) -- just for them and killed both of them.
HOLMES: The simple good-byes to a lost child begin in the car on the drive to the cemetery, itself a dangerous journey. There is little time in this war for ceremony, preparation, even grief itself. Just hours after play turned to death, Mahmoud is laid to rest.
Michael Holmes, CNN.
(END VIDEOTAPE)
HARRIS: Israel says it does not target civilians and says it is unaware of this incident.
Severe weather taking its toll in the Pacific Northwest. We are bringing it to you from the CNN Weather Center.
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HARRIS: In western Washington state, it is just a case of -- well, you can see it here -- just to much, to much rain and to much melting snow. And all of it has come together to bring about historic flooding. Rescuers pulled a person from this nearly submerged car earlier today. Authorities have urged 30,000 people to evacuate. Nineteen rivers are expected to reach major flood stage.
All this rain and flooding is slowing things up in Washington. Interstate 5, a major north/south highway, is blocked in sections. We get details now from Rick Price of affiliate KIRO.
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RICK PRICE, CNN CORRESPONDENT: Now we've had to move several times this morning because of the rising flood waters. And right now we've moved to the northern end of this 20 mile blockage of I-5. This is south of Seattle. It's about 88 miles north of the border with Oregon.
And you can see police car blocking the road surface of I-5. This is where they're taking traffic off, to turn them around and head them back away from this. This is not a 20-mile lake on I-5, but it is a place where there are a number of spots where water is over the roadway and that is blocking things.
I-5, we should tell you, is the major arterial on the west coast between Vancouver, British Columbia and the Mexican border. And because of that, for this to be blocked makes it very difficult. The state of Washington figures that it costs commerce about $4 million a day for this road to be closed. And right now, because the weather is so bad in so many parts of Washington state, there really are no good detours around this blockage.
So, for the moment, this is a very tough situation. The state department of transportation is working the issue, but some of these rivers have not crested yet. It will take a while for the water to get off the freeway after the rivers start to go down and then DOT crews are going to have to get out and check the pavement to make sure that there are not big washouts or potholes or weak spots in the pavement that could really cause trouble if traffic hit that at freeway speeds.
It is still raining here. The forecast says that it should dry out within the next 24 hours. But for right now, this is a big problem for the northwest corner of the country.
For CNN, Rick Price, Centralia, Washington.
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HARRIS: And, Chad Myers, we see a lot of pictures that we describe as a real mess. But what Rick Price just -- that's a real mess. CHAD MYERS, CNN METEOROLOGIST: Yes, and the avalanche danger is extreme out there. We've already lost, what, dozens now of people in avalanches this year alone. And now we have all of this rain on a lot of snow.
So what does that do? It melts some, yes, but it just makes that snow heavy. It makes it slush. And when slush rolls downhill, it has a lot of force. A lot more than a dry snow as well.
Where he was, where that reporter was, right about there. And I can show you what that looks like on a live shot, live camera, from Washington Department of Commerce. Department of the DOT. There you go. Look at all the cars on that road, Tony. That doesn't look good.
HARRIS: Look at that. Yes, nothing.
MYERS: Www.wsdot.wa.gov. That's the only place to get the very latest on what's going to be open and when is it going to be open because you can't get there from here. You know that old saying, this is a road to nowhere right now.
The rains are dying off. That's good news. But the water is still in the mountains. It has to come down. We're going to have mud slides. We're going to have avalanches. This is a real problem.
But not a problem here. I want to take you to the Bay Bridge because this is almost a serene looking shot.
HARRIS: Look at this.
MYERS: People coming over from Oakland to the Bay Bridge. KGO, our affiliate there, 46 degrees and fog in Oakland, but it warms up nicely with sunshine today.
Tony.
HARRIS: That's awesome. OK.
MYERS: That's nice.
HARRIS: Chad, appreciate it. Thank you.
MYERS: You bet.
HARRIS: Federal health officials looking into a salmonella outbreak in 42 states. The Centers for Disease Control and Prevention is trying to learn the cause of the outbreak. CDC sources say at least 388 people have been infected with the strain since September 3rd. Sixty-nine of them hospitalized.
Your reactions and comments to the speech from the president- elect on the economy. A lot of strong opinions. Josh Levs will have your e-mails next.
(COMMERCIAL BREAK) HARRIS: Dire warnings from President-elect Barack Obama about the economy. He says the current recession could linger for years without quick action on a stimulus plan. He also called on Americans to work together to confront the economic crisis.
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BARACK OBAMA, PRESIDENT-ELECT OF THE UNITED STATES: More than any program or policy, it is this spirit that will enable us to confront these challenges with the same spirit that has led previous generations to face down war and depression and fear itself. And if we do it. If we are able to summon that spirit again, if we are able to look out for one another and listen to one another and do our part for our nation and for posterity, then I have no doubt that years from now we will look back on 2009 as one of those years that marked another new and hopeful beginning for the United States of America.
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HARRIS: New and hopeful. Do you share that optimistic view? We have been asking for your reactions to Barack Obama's speech today. Josh Levs is following your responses.
Josh, what are you hearing from folks at home and around the country?
JOSH LEVS, CNN CORRESPONDENT: A lot of skepticism, Tony. A lot of it.
HARRIS: Really?
LEVS: Yes. You know, during the election, when we would ask questions, especially after some of Barack Obama's speeches, we often heard a lot more optimism. I just read through about 150 of the e- mails that have come in. By far, overwhelmingly skeptical.
Let's zoom in on the board. I'm going to show you the mix of what we're getting.
"His speech sounded like a campaign speech. We need answers. The election is over." From Don in Indiana.
"Apparently the best economic recovery plan that the new administration can come up with only directly impacts families with a $1,000 tax break. They should stick to infrastructure spending if that is all they can come up with to directly help 'main street'." That's from Cristina.
Here's one. "I do not usually agree with President-elect Obama's ideologies, but I was glad to hear him promoting spending. Consumer spending is absolutely the correct plan to recovery." From CJ Johns in Kennesaw, Georgia.
This is interesting. "I am a 57 year old single woman and I can't repair crumbling roads. What about all the money I have lost in savings and my IRA. I have a job but with the economy the way it is, I might not be able to keep it. We should do away with income tax and the IRS."
A bunch of people telling us that, Tony.
Check out this here. "Obama speaks about Washington's irresponsible spending of taxpayer money. I wonder what his tab is for 'pork barrel' spending." Derek in Tupelo, we actually have that information for you, cnn.com. The truth squad tackled that a few times during the election.
Check this out. From Michael McCullough. "Instead of giving trillions of dollars to big businesses, who got us where we are with unbridled greed, why not give those trillions to the people. These people would pay off bank notes and other bills, which would in turn bail out the banking industry."
Got time for a couple more. "Let's give Obama a chance to try and turn things around. My guess is he will be more criticized than our current president." That's from Sheldon.
And we can end with this, Tony. "We are in a global economic war. The real need is 20 trillion dollars over the next five years and a whole new way of thinking and doing. For all the Obama promise of change, this is really more of the same old thinking." That comes to us from Sherman in Boulder City.
So that's what we got (ph).
HARRIS: Yes. OK. Why don't we do this. Why don't we keep the e-mail machine fired up for Kyra's two hours starting in just a couple of minutes and let's see what people are saying because, in fact, we are going to replay, re-air the entire speech . . .
LEVS: In the 2:00.
HARRIS: In the 2:00 p.m. hour.
LEVS: Right. Good idea.
HARRIS: So let's get the e-mail machine going and keep it going.
LEVS: Keep them coming. We'll come back on later today. That's great.
HARRIS: All right, Josh, appreciate it. Thank you.
Again, 2:00 p.m. Eastern Time, we will re-air, replay the entire speech from the president-elect, Barack Obama.
OK. We can't let this day in Vegas, the latest coolest gizmos live from the Consumer Electronics Show next in the NEWSROOM.
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HARRIS: You know, the economy may be biting at your budget, but techies are still itching to show you their new, cool gadgets. Let's see here. We'll judge it for ourselves. The Consumer Electronics Show opens today in Las Vegas and that's where we find cnn.com's Nicole Lapin (ph).
Nicole, good to see you.
I mean, don't the techies understand we're in a recession here?
NICOLE LAPIN, CNN.COM: Recession, Tony, what recession? Look at these huge displays at the Consumer Electronics Show. I've got to tell you, 1.7 million square feet of space on the floor of CES. It is $35 a square foot. So I don't know, Tony, you and I could maybe split it and we could get this little space. But the recession, Tony, is actually good for you, the consumer, because gadgets now are going to be greener, they're going to be cheaper. And I'm not saying anything, but they're going to be easier for you to use.
HARRIS: They need to be. Can you take me for a little tour?
LAPIN: You want a tour?
HARRIS: Yes. That would be great.
LAPIN: Are you ready? All right.
We're in Samsung here. We've been seeing a lot of all in one gadgets, Tony, and also nesting. Because during these tough economic times, you want to get everything on your couch, in your living room. The movies, the Internet. And then, of course, you have this whiz- bang stuff.
Look at this. This is a 3-D video game by Samsung. I don't know if I'm going to crash on this.
HARRIS: Now I need you to . . .
LAPIN: Check this out too. I know you're a movie guy. . .
HARRIS: That's right.
LAPIN: Because, look, this is a 3-D movie out. It's $100. Do I look cute?
HARRIS: That's cute. Yes, that's cute.
LAPIN: Do you like these? OK. $100 will get you the glasses and the contraption that lets you see the movies in 3-D. So do you have any requests here, Tony? I'm taking requests
HARRIS: Well, I like both of those items. If you'll float me and bring those back for me, I'll gladly pay you next week, because I'm broke today. Is that all right?
LAPIN: Absolutely. Because this, Tony, is the week where what happens in Vegas does not stay in Vegas. The show lasts until Sunday. The latest and greatest in gadgetry and technology. And we are just getting started.
HARRIS: That is terrific. All right, Nicole, great to see you. Have a good time. And bring back some goodies.
LAPIN: Thank you. Absolutely.
HARRIS: Have a great time.
LAPIN: Thanks.
HARRIS: CNN NEWSROOM continues right now. You ready to rock?
