Return to Transcripts main page
American Morning
Buffalo Plane Crash Probe; No Car Czar for the American Auto Industry; Oil Down But Gas is Up; Nuclear Subs Collide; Pakistan- Taliban Deal
Aired February 16, 2009 - 08:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JOHN ROBERTS, CNN ANCHOR: Coming up now on one minute after the hour.
Developing right now. Disturbing report that two submarines carrying nuclear weapons slammed into each other deep under water. According to British newspapers, a French and British vessel collided in the Atlantic. British official says there was no compromise to nuclear safety and no injuries. But one British nuclear opponent said it could have been a, quote, "nuclear nightmare."
Markets in Asia taking a hit overnight after a Japanese official said the country is suffering its worst financial crisis since the end of World War II. Comments followed news that Japan's economy shrunk by 13 percent in the fourth quarter.
President Obama will not be naming a so-called car czar to oversee the structuring of the struggling auto industry. Instead, the president plans to create an administration task force led by Treasury Secretary Timothy Geithner and Larry Summers, the head of the National Economic Council. Yesterday, on NBC's "Meet The Press" White House senior adviser David Axelrod said "Efforts to shore up the auto industry will require sacrifices from the top down."
(BEGIN VIDEO CLIP)
DAVID AXELROD, SENIOR ADVISER TO PRESIDENT-ELECT OBAMA: We're going to need a major restructuring of these companies. How that's restructuring comes is something that has to be determined, but it's going to be something that's going to require sacrifice, not just from the autoworkers, but also from creditors, from shareholders, and the executives who run the company and everyone is going to have to get together here to build companies that can compete in the future.
(END VIDEO CLIP)
ROBERTS: Tomorrow is the deadline for General Motors and Chrysler to submit plans detailing how they can repay billions of dollars in government loans.
Former Secretary of State Colin Powell talking about President Barack Obama breaking the White House color barrier. The General sat down with CNN's Don Lemon and talk about the emotions running through his head on Election Day.
(BEGIN VIDEO CLIP) GEN. COLIN POWELL, FORMER SECRETARY OF STATE: It hit me. It hit me emotionally. I was suspecting him. I supported him, I voted for him, but it was still like a shock. And I just sat down in my chair and my kids were crying, and I said to myself, "We did it. We actually did it. What a great country."
(END VIDEO CLIP)
ROBERTS: Well, this morning, federal investigators are revealing new details about Continental Flight 3407. Officials say the plane was on auto pilot just before the deadly crash raising questions about the role of the airline crew. And CNN's Ines Ferre has more.
John, Kiran, investigators have been working hard trying to figure out how this plane literally fell from the sky.
(BEGIN VIDEOTAPE)
INES FERRE, CNN CORRESPONDENT (voice-over): It was a frightening fall from the sky for everyone on board Flight 3407. Investigators now say the plane dropped 800 feet in five seconds just before it slammed into a house in a Buffalo suburb. Just 26 seconds before the crash, the plane went into violent jerking motions, pitching and rolling before banking a sharp 105 degrees to the right. Investigators also revealed that the plane had been running on auto pilot just before it crashed.
STEVEN CHEALANDER, NATIONAL TRANSPORTATION SAFETY BOARD: In icy conditions, it might be best to disengage the auto pilot and fly the airplane manually so that you have the manual feel for what might be changing in your flight regime because of the ice.
FERRE: The National Transportation Safety Board says that in the past, it's advised against running on auto pilot in severe icing conditions, but the conditions that night were not specified as severe. And NTSB officials say it's the FAA that calls the shot when it comes to auto pilot regulations.
CHEALANDER: In this one situation, the FAA sees things a little differently than we do because they see that for some reasons, that you may need to be flying with the auto pilot. Workload is one of those.
FERRE: Freezing temperatures and piles of wreckage have slowed attempts to find the remains of all 50 of the crash victims.
CLETUS KRAFT, RESIDENT: I can't help but think of the pain and suffering that all the families are going through.
FERRE: While investigators do their work, a local resident made room for flowers at this make-shift memorial site outside a church just blocks away from where the plane went down.
(END VIDEOTAPE)
FERRE: And the area around the crash site is restricted as investigators continue working through the wreckage. No word yet on when they will reopen it.
John?
Kiran?
CHETRY: Ines Ferre reporting.
Also developing right now, Secretary of State Hillary Clinton arriving in Tokyo this morning. It's the first stop on her first overseas trip as secretary of state. CNN's Jill Dougherty is live in Tokyo for us this morning.
Tell us more, Jill, about what her top priorities will be this week.
JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Well, Kiran, you know, it's a week-long trip but it's a very intense trip. She is going to be packing in four countries into that time. Beginning here in Japan and the message, of course, is that this is a cornerstone relationship for the United States and Asia.
She'll also be going to Indonesia, South Korea, and China. And if there are any really overarching messages, you'd have to say number one the issue is the economy. You just heard, the Japanese economy is in very bad shape. Severe economic problems throughout the region and throughout the world. So that's number one. And Secretary Clinton said tonight that she will be briefing the leaders of these countries about the stimulus program in the United States.
Also security and in this part of the world, security often means North Korea. So two things on that agenda. They want to stop the North Korean nuclear weapons program and, also, here in Japan, big concern are the abductees. Those are citizens of Japan who were kidnapped by the north back in the '70s and '80s, never accounted for and the Japanese want to know what happened to them.
Secretary Clinton is going to be meeting with some of the families of those abductees. And then finally, climate change. Huge issue. Of course, throughout the region, but especially in China.
Kiran?
CHETRY: Jill Dougherty for us this morning in Tokyo. Thank you.
ROBERTS: Well, with his wife traveling the globe as America's chief diplomat, life has certainly not slowed down much for former President Bill Clinton. In a recent survey a bunch women were asked what role Mr. Clinton should take on with his wife now heading the State Department. The answer was shall we say somewhat surprising. So I asked the former president for his thoughts on it.
(BEGIN VIDEO CLIP)
ROBERTS: The "U.S. News and World Report" this week commissioned to poll, surveyed a bunch of women in America, asking what role you should take on with your wife as secretary of state. 37 percent, the greatest number of women, said house husband. I'm wondering what you think about that.
BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES: Well, you know, it's funny, I told her when she left that I wish now that I was an ordinary citizen because I wish I could go with her and be there when she comes home at night and do for her what she did for me when I was president. But it's not in the cards. We're doing the best we can to work through this and do the right thing.
ROBERTS: Would you ever be comfortable being a house husband?
CLINTON: No, I have to go to work. I'm too much of a Calvinist. If I don't work every day, I get nervous.
(END VIDEO CLIP)
CHETRY: I know how he feels.
ROBERTS: You're not expecting to see him as a house husband.
CHETRY: Well, not that that's not work. Come one, it's harder to be home sometimes.
ROBERTS: The second highest percentage thought that he should be named special ambassador on AIDS/HIV to Africa. Three percent said he should be PGA commissioner. I'm sure that was interesting.
CHETRY: Oh, that is interesting.
ROBERTS: He has a great love of golf, so --
CHETRY: Yes, absolutely. But I wanted to ask you because we did have a chance to talk to him. He seems to be just tickled and thrilled with his wife's new job.
ROBERTS: Oh, absolutely.
CHETRY: Is there any of that lingering bitterness or anything over the fact that she didn't win?
ROBERTS: Not that I detected. I think that he's made his peace with it and now he's just championing her out there on the global circuit trying to make peace here and there and make sure that America's position in the world is what he believes it should be.
CHETRY: What a nice house husband.
ROBERTS: So Senator John McCain said that President Obama is off to a terrible start. What does President Clinton think about the early days of the Obama administration. We'll get his answer at 8:30 right here on the "Most News in the Morning."
CHETRY: And what's the story with gas prices. Oil, as we've been talking about, has fallen to new lows, but the price of gas inching back up day after day. Now it's up to nearly $2 a gallon. So what gives? Well, we'll have some answers for you. It's 9 minutes after the hour. (COMMERCIAL BREAK)
CHETRY: Well, this morning, gas prices are holding steady, $1.97 after 18 days of increases. And the rise in price comes at a time that oil prices have actually plunged from their record high of nearly $150 a barrel last summer. So what gives? CNN's Allan Chernoff is "Minding Your Business."
(BEGIN VIDEOTAPE)
ALLAN CHERNOFF, CNN SENIOR BUSINESS CORRESPONDENT (voice-over): Have you noticed prices at the pump. They're heading back up?
UNIDENTIFIED FEMALE: It's strange, and I'm not liking it.
CHERNOFF: Up 31 cents a gallon so far this year.
UNIDENTIFIED MALE: It hurts when you're on a fixed income. You have money going out, you don't have that much coming in.
CHERNOFF: At a time when the price of crude oil has been sinking.
JIM DONOVAN, OWNER, TEANECK SHELL: It does seem kind of strange.
CHERNOFF (on camera): Station owner Jim Donovan says he's not making any more profit.
DONOVAN: We're pretty much set at the same profit whether you're paying $3 at the pump or paying $1.85 at the pump.
CHERNOFF: So if you're not making a lot more money in this environment, who is? If the price is going up, somebody has got to be making money.
DONOVAN: Well, I guess it's the oil companies that are making the money. But it's not us.
CHERNOFF: It's the gasoline refiners who are profiting from these higher prices and the prices could keep on climbing, because this time of year, refiners always shut some of their facilities for maintenance.
PETER BEUTEL, OIL ANALYST, CAMERON HANOVER: We've seen refineries going through maintenance during the months of January, February, March and April. It isn't really until we get into the second half of May that refineries are ready to run all out for the summer.
CHERNOFF (voice-over): The wildcard affecting gas prices, how much will Americans drive? We've put the brakes on our driving since gas hit $3 a gallon in late 2007. But in the past few weeks, gasoline demand has stabilized, meaning prices got low enough that Americans have been putting their feet back on the pedal. Even in these tough economic times.
Allan Chernoff, CNN, Teaneck, New Jersey.
(END VIDEOTAPE)
ROBERTS: Well, he is a busy man these days. So how much basketball does the president actually get to play? You might be surprised at what President Obama's press secretary told our John King.
And new questions this morning about what role the crew may have played in that deadly Buffalo plane crash. A spokesman for the National Transportation Safety Board will be with us after the break. It's 13-1/2 minutes after the hour.
(COMMERCIAL BREAK)
ROBERTS: 16 minutes after the hour. Developing this morning. Terrifying new details emerging about the final moments of Flight 3407 that crashed outside Buffalo. Investigators say the plane fell 800 feet in five seconds killing all 49 people on board and one person on the ground. They also determined that the plane was on auto pilot when the incident occurred.
Joining me now is Steven Chealander. He's a board member of the National Transportation Safety Board, a former pilot himself with thousands of hours flying under his belt on numerous aircraft from the F-4 to the DC-10.
Steve, it's good to have you with us this morning. Let me ask you this question. I was talking with a former Dash 8 pilot over the weekend. A lot of speculation in the pilot community is pointing to a potential that ice was building up, not so much on the wings but on the tail plane. Are you getting any evidence of that and what that might have done to the aircraft while it was in the sky?
STEVEN CHEALANDER, NATIONAL TRANSPORTATION SAFETY BOARD: We haven't gotten anything to report on ice on the tail. That's something that will be an ongoing part of the investigation. What we have thus far is as we've reported from the cockpit voice recorder, we've heard the crew talk about significant ice buildup on the windshield and on the leading edge of the wings. As far as on the tail, we don't have any information on that yet.
ROBERTS: You know, from what I've -- what I've gleaned talking with pilots who know this aircraft, if you have an ice buildup on the wing, it's likely that you would get an ice buildup on the tail section and perhaps to an even greater degree. Does that follow what you know?
CHEALANDER: I guess it follows what we know so far. And we've got pilots that are familiar with the Q-400 as part of our investigation. We are using the party system and our parties to our investigation helping us out in that regard. There's also -- we've got some pilots from the different airlines that flight it, and so we are asking questions like the ones you're asking now, but it's pretty premature to get that information out.
ROBERTS: Given the data that you have gleaned from the flight data recorder about a sharp pitch up in the nose followed by a sharp pitch down, roll of 45 degrees to the left and then way over to 105 degrees to the right, does that give you some kind of indication of the forces that were at work here which may lead you to some sort of idea of exactly what happened to that aircraft as it was coming in for a landing?
CHEALANDER: Well, it's obvious by those parameters that there was a very severe upset in progress. And what we'll be doing for the next 12 months or so is analyzing what caused that upset, the nature of it, and whether it was a truly aerodynamic style. There's a lot of things to look at. We've got a lot of engineers and technical experts working on that, but right now, all we have is what we've reported to you thus far and the numbers you gave are correct.
ROBERTS: And Steve, what about this idea of the auto pilot being on at the time. People familiar with this aircraft say that in an icing condition, it's not a good idea to have the auto pilot on. I know the NTSB recommends the auto pilot be turned off in severe icing conditions, though we only heard about significant icing here.
They say that having the auto pilot on doesn't give the pilot a real feel for how the aircraft is performing. What's your sense of that? Was it a mistake to leave the auto pilot on?
CHEALANDER: I wouldn't characterize it as a mistake. We have -- the NTSB, that being the "we", having indeed recommended that encourage pilots to disengage the auto pilot when they are flying in icy conditions. Now, that recommendation has been made to the FAA on behalf of the air carriers and the FAA is studying that recommendation, and we get into a letter writing campaign with the FAA, if you will, determining whether or not it's a good idea to follow our recommendation or not.
ROBERTS: All right.
CHEALANDER: And so this goes back and forth until they figure out that all the unintended consequences have been accounted for and the intended consequences and then they are the rule-making body, they are the ones that make the rule. There is not a final rule yet. We're not an enforcement agency or a regulatory agency so we can only recommend.
ROBERTS: We'll keep following the investigation closely. Steve Chealander of the National Transportation Safety Board, thanks for taking the time from your busy day this morning. Really appreciate it.
CHEALANDER: My pleasure. Thank you.
CHETRY: Here's a shocking new report about two nuclear submarines colliding deep under water. British media reports say that a French and British vessel crashed at sea. We're going to get a live report from London.
And under pressure to create jobs and under fire from Republicans, two things all too familiar to former President Bill Clinton. He's going to have some advice for the current president on this president's day. It's 20 minutes after the hour.
(COMMERCIAL BREAK)
ROBERTS: Welcome back to the "Most News in the Morning." And this just in to CNN. Pakistan's government striking a deal with the Taliban that could be a major blow to President Obama's military strategy for the region. Let's talk to CNN's Barbara Starr about it. She's live in Washington.
Barbara, they're allowing the Taliban in those northwestern provinces, the FATA area, the Federally Administered Tribal Areas, to practice Sharia law, which is the same that they practiced in Afghanistan when they ruled Afghanistan. Is this the Pakistani government basically throwing up its hand and saying, OK, we submit to you?
BARBARA STARR, CNN PENTAGON CORRESPONDENT: That's what is sure appears to be, John. The Pakistani government just announced today that it has, in fact, made this huge concession to the Taliban that is going to complicate things for the Obama administration. The Pakistanis announcing they have reached an agreement with the Taliban to allow strict Islamic law or Sharia, as you said, to be implemented in parts of the Northwest Frontier Province.
This is an area that the Pakistanis should be in control of, not the Taliban. Here's the problem. One of the expected centerpieces of the new Obama strategy is training of the Pakistani Frontier Corps, the Pakistani Army, to fight the Taliban, and now it looks like the government there has undercut that by, once again, making concessions. More U.S. troops set to go to the border areas in Afghanistan to tackle these very people.
It's the council of Taliban leaders in the city of Quetta in Pakistan that is basically running this area unchecked, possibly even hiding some top al Qaeda leaders, according to the United States.
You know, in the past, when Pakistan has made concessions to the Taliban in hopes of controlling them through diplomacy, they have simply gained more ground, more strength. Now, 60 days from now, the Obama administration is supposed to have a new policy for this war. It's becoming more problematic by the day.
John?
ROBERTS: Yes. We all remember the deal that Musharraf struck in the tribal areas a couple of Septembers ago and how well that worked. Let's see what happens here.
STARR: Indeed.
ROBERTS: Barbara Starr for us this morning. Barbara, thanks so much.
STARR: Sure.
CHETRY: Well, some disturbing new reports out this morning. Two subs carrying nuclear weapons slamming into each other deep under water. Reports from British newspaper say that a French and British vessels collided at sea. Our Phil Black is tracking the story for us live from London this morning. You know, the more details we're getting about this or the more we've had time to sink it in, it just seems preposterous that in the huge Atlantic Ocean these two subs both having some problem, I guess, with their sonar gear, crashing into each other.
PHIL BLACK, CNN INTERNATIONAL CORRESPONDENT: Absolutely extraordinary, Kiran, the idea that two submarines in the vast deep Atlantic Ocean operating separately could come together at the same place, at the same time. It is one in a million thing. That's how it's being described here.
But let me tell you, there's been a development here just a short time ago from the British Ministry of Defense where I'm standing and from French military authorities as well. They have confirmed this collision did take place. They say that earlier this month, the two submarines came together briefly while operating slowly and submerged and they were damaged and they have since returned to their respective bases.
So, we now know for a fact that yes, this did happen. The question, as we're saying, is how is this possible? It does appear that the sophisticated sonar detection equipment that these boats use to identify and be aware of other vessels in their immediate vicinity, it appears there has been some sort of failure there.
At the moment, it's just embarrassing, but it is significant because of what these submarines were carrying. They're both nuclear powered. They're both had reactors on board. And they both carry up to 16 nuclear weapons -- sorry, ballistic missiles, I should say, with multiple warheads.
So, inquiries, as you would understand, now under way both in France and here in Britain as well.
Kiran?
CHETRY: Phil, that's interesting because when we talked to you about an hour ago, the British government wasn't saying anything about the situation.
BLACK: Yes. This has changed over the course of the morning. They would say unofficially, but they would not officially confirm that this was the case. They said it's their policy not to comment on submarine operations and that was as far as they would go.
The French went even further. They issued a statement a few days ago which said that their boat, their submarine, the Le Triomphant, was involved in a collision, but probably with a shipping container. It now seems that the story has gone public. They have given into that pressure, if you like, and they have confirmed that this did, indeed, take place.
Both the French and the British, though, are keen to point out that they say the nuclear deterrents, that is the deterrence capability, their ability to launch these missiles, was never affected, nor was the security of the nuclear weapons themselves. Kiran?
CHETRY: All right. But an underground accident of that magnitude could have been certainly the worst-case scenario. So, we'll keep checking in with you on this story. Phil Black, thanks so much.
John?
ROBERTS: It's 28 minutes after the hour. New this morning. No car czar for the American auto industry. Instead, a senior administration official says President Obama is putting together a task force to look at ways to save the Big Three. Tomorrow is the deadline for General Motors and Chrysler to prove that they can pay back billions of dollars in government loans.
It's like stealing Superman's cape. Lance Armstrong asking for his bicycle back this morning. He says someone stole it from a team truck in California just hours after he rode it in a race on Saturday. Armstrong posed a picture of it on his -- he posted a picture of it on his Twitter account, saying there's only one like it in the world, so it's hard to pawn it off. He also offered a reward for it.
NBA legends breaking down President Obama's game. Chief national correspondent John King sat down with Hall of Famers Bill Russell, Magic Johnson and others and went over a tape with the president on the court. Magic appreciated the no-look pass and said that the president showed smarts. Yesterday on "STATE OF THE UNION," his press secretary, Robert Gibbs, says the game keeps the president grounded.
(BEGIN VIDEO CLIP)
JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT (on camera): How much does basketball mean to this president in terms of stress relief, mental health, if you will?
ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: Yes. You know, John, there are very few days in which I don't see, at some point in the day, the president either handling or dribbling a basketball. I know he's anxious to get out on the court. He is going to play with some friends in Chicago here today. It's been a part of his life for a very long time. Growing up in Hawaii and playing with his friends on a playground and, you know, even playing with those very same friends now.
So, it's a big part of his life. It helps him get some exercise and relieve some stress. For a little bit of time, he can think about something different. So it's a big part of his life. He really enjoys it and I tell you what, John, I can only imagine that if I were to call him now, he'd be a little nervous that people like Bill Russell were going to critique his game. That's pretty serious.
(END VIDEO CLIP)
ROBERTS: Magic Johnson also said the president is running the country like a point guard, always seeing what's ahead. Twenty-eight days into the Obama administration and the new president is taking plenty of heat. His former opponent, Senator John McCain, said President Obama is off to a terrible start with his efforts to reach across the aisle. Only three Republicans supported the president's $787 billion stimulus bill, something the president is expected to sign tomorrow in Denver.
I sat down with former President Bill Clinton, the man familiar with fierce partisanship and economic problems, and also the husband of another rival of Barack Obama when he was then a senator and a candidate for president.
JOHN ROBERTS, CNN ANCHOR: ... something the president is expected to sign tomorrow in Denver.
I sat down with former President Bill Clinton, a man familiar with fierce partisanship and economic problems and also the husband of another rival of Barack Obama's when he was a senator and candidate for president and I asked the former president how he thinks the new chief is doing.
(BEGIN VIDEOTAPE)
ROBERTS: What do you think of the job that President Obama did this? And is he, in fact, does he, in fact, have the experience necessary to be a good president, to reach across party lines and craft a bipartisan bill?
BILL CLINTON, FMR. U.S. PRESIDENT: Well, first of all, he has reached across and it takes two to tango. I find it amazing that the Republicans who double the debt of the country in eight years and produced no new jobs doing it, gave us an economic record that was totally bereft of any productive results are now criticizing him for spending money.
You know, I'm a fiscal conservative. I balance the budget. I ran surpluses. If I were in his position today, I'd be doing what he is doing. Why? Because the problem with the economy is the housing decline led to the general decline in values. Assets are going down. This stimulus is our bridge over troubled waters till the bank reforms kick in. He did the right thing. He did everything he could to get republican support. He took some of their tax cutting ideas.
But if you look at this bill, it is designed to do three things. And it does all three. It puts money in the hands of people who need money to survive. Unemployment benefits, food stamp benefits, tax cuts. Second thing it does is to give money to state and local governments so they don't have to lay a million people off or raise taxes. Either one would be bad for the economy. The third thing it does is create new jobs. And I think given the Congress he had and the environment and the speed in which they had to move I think he did a fine job with this.
ROBERTS: So what is your take then on what Senator McCain said he is off to a terrible start?
CLINTON: Well I just disagree with him. But we have a different economic philosophy. For example, there is a hundred economic studies which show that you get a better term in terms of economic growth on extending unemployment benefits or investing money in energy conservation and jobs to improve buildings than you do giving people of an income group a tax cut. But it doesn't stop them. Those guys are on automatic. They have a you know, you punch a button and they give you the answer they give you.
I think that there are a lot of tax cuts in that bill for middle class families, for lower income families. There is a $7,500 tax credit that will kick in when these plug-in electric vehicles go on the market which will help us become the world's leader in that and secure us jobs for a decade or more.
ROBERTS: Do you really think the president can change Washington, can bring the type of change to Washington that he campaigned on? He is already up against the wall against Republicans in Congress, not quite as big a wall as you found yourself up against in 1993, but he does seem to be having some difficulty. Do you think he really can bring change to Washington?
CLINTON: Here is what I think will have to happen. I think that as we go along, if the American people stick with him and if he begins to have good results, then I think more and more republicans will cooperate with him because they will see that he is right or because he carried their states or for any number of reasons.
ROBERTS: How long do you think he has?
CLINTON: Well, I think that, first, his next big challenge is to come forward with the details of how we're going to rewrite as many home mortgages as we can, how are we going to take some of these bad assets off the bank books so they can get cleaned up and they can loan money, and what conditions will we give more money to banks for. That is we're going to have to loan money from now on. That's what Secretary Geithner is working on.
Those three things make a lot of sense. That's our long term answer. The stimulus is our bridge over troubled water and I'll say again. So when he does that, as it starts to work and people see America start moving again, then I think you will see people open up and then we'll see a more bipartisan spirit develop.
ROBERTS: How much time do you think he has? 100 days? Six months? A year? Two years?
CLINTON: The public, I believe, will support him at least for a year in trying to work these things out and he's been very straightforward in saying it might take as much as two years for the economy to really get in gear again. My instinct is it will happen a little quicker than that. But keep in mind, before he ever took office, $30 trillion had disappeared. That's more than twice America's annual gross national product.
(END VIDEOTAPE)
ROBERTS: It's always great to sit down and talk with him. It's been a long time since I did. 2005 I think was the last time I sat down with him. He knows so much about so many different things and he always has a story to tell. He was wearing cowboy boots and you couldn't see them there. They were covered up by the little CNN live thing. Lucchese ostrich boots. And I just said, Mr. President, nice boots. He said, well, thank you, John. And five minutes later, he finished telling me the story about his boots.
CHETRY: I guess you can practice anchoring with me. But you know the other interesting thing is because so many people have talked about gloom and doom, it's nice to hear someone, as you said as smart as he is and in touch with so many brilliant minds to say we will get through this and come out on the other side, perhaps better. Because right now we don't feel that way.
ROBERTS: He's also ever the optimist as well.
CHETRY: He is.
ROBERTS: But don't forget too he came from a time we were talking about retiring the debt. We were running surplus of $250 million a year. I think he paid off $600 billion in debt and had a plan to retire the debt by 2015 and economists were getting together saying, how are we going to affect fiscal policy and monetary policy if we're not selling T-bills anymore? How do we do that? We don't have to worry about that anymore.
CHETRY: They wish they had that problem now.
ROBERTS: You don't have to worry about that.
CHETRY: All right. The interesting thing and you talked to him about this is he is one of the people that in fact "Time" magazine and a lot of other, you know, publications are saying is the reason why or at least one of the culprits of where we are.
ROBERTS: Yes, the Gramm-Leech-Bliley Act which supersedes the Glass- Stiegel Act, community reinvestment plan -
CHETRY: That's right.
ROBERTS: The Commodities future modernization act. He rejects all of that. He said we should have done something more on derivatives but he says he believes his critics are wrong. CHETRY: Right. We'll coming up. We're going to talk more about who's to blame. We have a very interesting interview. Some you may not have heard of. So stay tuned for that. Meanwhile, great job by the way.
ROBERTS: It was great to go down there. I love Austin, too. It was wonderful to be there for a weekend.
CHETRY: You need to spend more than 14 hours there.
Well, still ahead, housing, jobs and banks. All in crisis. We've been talking about the global recession taking hold and a lot of people have been wondering can we pinpoint who is to blame or at least figure out a little bit more how we got here? Well, we have some answers and we're naming names, just ahead. It's 37 minutes after the hour.
(COMMERCIAL BREAK)
CHETRY: Well a stimulus package and a massive bank bailout add up to a trillion and a half dollars being spent in Washington. On top of all of that, of course, millions of jobs have been lost across the country, home foreclosures as well and it's got a lot of people asking who is to blame for this mess that we're in?
"Time" magazine is naming names in their latest issue and joining me now is their contributing editor, John Curran. Thanks so much for being with us.
JOHN CURRAN "TIME," CONTRIBUTING EDITOR: Nice to be with you.
CHETRY: Not just to point blame but maybe to learn, right, for the future? How to make sure we don't get in this mess again.
CURRAN: Right. We got a big financial mess on our hands. You really have to look out and look over the last decade and see what we did right, what we did wrong and learn from that so we don't do it again.
CHETRY: Let's start with some of the people that you write about. One is Phil Gramm. He is the chairman of the Senate banking committee from 1995 until 2000. He also championed deregulation and also had a prominent role in repelling - it's the Glass-Stiegel Act but basically it was this act from the depression era that kept retail banks and investment banks separate. So what effect did that have?
CURRAN: Well it kept them separate so banks did not get in too much financial trouble and so when they took it off, banks starting taking out all these risky businesses. They started buying all these financial assets, making investments they shouldn't have been making and as a result we're now looking at the banking industry steep in losses and it really traces back to taking apart Glass-Stiegel.
CHETRY: It's interesting, they say in the year before the repeal, subprime mortgages were about five percent of total mortgages given out and then within that year, they were up to 30 percent. You also say that Allan Greenspan who is the former chairman of the Federal Reserve, viewed as a guru of economics and somebody that really pushed for deregulation, was also a culprit, especially in regard to the mortgage crisis. Explain.
CURRAN: Well, the mortgage crisis and also Greenspan did not stop the party when the party got going too strong. Americans consumer lending or borrowing too much and interest rates were too low and a lot of people got into the housing market that shouldn't have.
Greenspan should have seen the inflation in the housing market. He should have let interest rates go up which would have cooled the housing market down. He didn't do that. As a result, we have the housing mess that we have now.
CHETRY: Also, added to that pile of people that were sort of there at the same time is President Clinton. John spoke to him and he denies this was the case. But you talk about the combination of the repeal of Glass Stiegel but also pushing this Community Investment Act where they wanted more people to be able to own homes. Some of those people, unfortunately, were not able to afford them.
CURRAN: Right. An act that was very well-intentioned looking to expand home ownership to the lower part of the economy. But what really happened is a lot of people that could not afford homes were sort of pushed into buying homes and, as a result of that, you have a lot of people now who can't afford the homes they are in and that traces back to the problems that we're at.
CHETRY: That was something, of course, not to leave the prior administration blame-free and continued under the Bush administration.
CURRAN: Actually every President who we have had over the last few decades has played some role in this. Clinton and Bush the most recent ones that's closely connected to the crisis. So we look to them.
CHETRY: And also you say that the American consumer comes, of course, they are not only victims in this because many are, but also the culprits. Explain that.
CURRAN: Well, the nice vines were all wearing that as part of the consumer binge. We really spent more than we should have been spending and that went on for too long. We really overdid it in a lot of ways and usually people stop those things when they know they've reached a point of excess. The consumer didn't stop this time and we have big problems.
CHETRY: Tell us how China is involved real quickly.
CURRAN: China is an enabler. They should not have given us all the money. They have $1.7 trillion of U.S. debt they are holding on right now. They should have stopped that and they didn't stop and they didn't wanted to keep exporting to us to sell the things that we were buying. They let the whole party go on too long.
CHETRY: Well, hopefully they're not going to start re-negging now, right. Because well be in trouble. Very interesting. If you want to read the whole article it's in this week's "Time" magazine. John Curran, thanks so much for joining us.
CURRAN: My pleasure.
CHETRY: John.
ROBERTS: If you've lost your job, could taking a part-time job would be the answer? Would it be the right move? Can you get through the rough spots with it and does anyone even hiring? Our personal finance editor Gerri Willis is with us and she's got a list of companies that are. 44 minutes now after the hour.
(COMMERCIAL BREAK)
ROBERTS: Now here's a staggering figure to consider. More than 11.5 million Americans are now looking for work. If you're unemployed should you consider a part-time job and where could do you go to find it. Personal finance editor Gerri Willis is here with some answer in her on-going series, "Who is hiring?" So who is hiring?
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Well, John, great question. First of all I want to you talk a little bit about how we are expanding the idea of what it means to be employed. Part-time, temporary. If you're looking for work, you're looking for anything at all now. The government doesn't necessarily follow these numbers but anecdotally we're hearing that lots of employers are offering more of these jobs.
Let's listen to this expert had to say about part-time work.
(BEGIN VIDEO CLIP)
SARA SUTTON FELL, CEO, FLEXIJOBS.COM: The job seekers who previously might not have explored work telecommuting and work from opportunities are starting to do so because the employment market is not as great. They might be looking out of the box for opportunities that - whereas, previously, they may have just looked at full-time traditional jobs.
(END VIDEO CLIP)
WILLIS: All right. So where are those jobs? Let's talk about those companies. First one up, Kaplan. These are the test prep companies that actually help college students get ready for the S.A.T., the G.M.A.T., the G.R.E.. They are looking for 3,000 instructors.
ROBERTS: Wow. My son has faced the M.C.A.T. -
WILLIS: It's that what he's taking?
ROBERTS: Well if you want to do this, you actually have to have taken the test and done well on it. You can't be anybody at all. But they pay $20 to $25 an hour. If you are interested in this, go to kaptest.com, is the website.
Aramark is company that has ten staffing centers around the country. They staff events all kinds of events for major league baseball. They are hiring 500 folks now here for a rodeo they are doing. ROBERTS: What?
WILLIS: Yes.
ROBERTS: In Texas.
WILLIS: Yes. Well, I'm not sure of the location -
ROBERTS: Hit the road and the rodeo!
WILLIS: Well, you got to look at jobs where you are, obviously. But they do have opportunities in 10 cities across the country. Aramark.com is the place to go to find them. And Fetchpetcare.com, they are looking for 1500 pet sitters across the country and they are in 37 states and you guess it, private dog walks, doggie day care, yard cleanup, you're on the hook to do all kinds of things you may or may not like to do but it does pay and you have to be over 21 to take advantage of it. Fetchpetcare.com is the website to go to. One other thing here. You know, we just showed this young woman from a website. You're seeing more and more of these web sites. Elance.com. All bubbling up to respond to the need for people who are looking for jobs. Just a reminder if you're looking for a free website, hot jobs and monster.com. Two great websites.
ROBERTS: What about the possibility of turning a part-time job into full-time employment?
WILLIS: It happens. You know, right now, I think right now employers are being very conservative by hiring part-time workers because they don't have to pay them benefits and reduce their own costs but this is something you could build into a full-time position as the economy starts to turn. What's more, other employers in the same sector start seeing your work and you get your name out there. You build your resume which is always a good thing.
ROBERTS: Getting your foot in the door is the most important part.
WILLIS: That's right.
ROBERTS: Gerri Willis, some great tips this morning. Thanks so much.
WILLIS: My pleasure.
ROBERTS: Kiran.
CHETRY: Well, a mystery fireball flies across the sky. All of it caught on camera. Spectators watched, runners suddenly seeing a blaze of white light. We're going to see what the FAA is saying about what that was in the sky. It's 49 minutes after the hour.
(BEGIN VIDEOTAPE)
CHETRY (voice-over): Looking for love? It's not just looks and personality anymore.
UNIDENTIFIED MALE: I consider finances a big deal. CHETRY: Height. Weight. Debt.
UNIDENTIFIED MALE: This is something that may make your potential date or your first date do this.
UNIDENTIFIED FEMALE: So if you're both in a mountain of debt?
UNIDENTIFIED MALE: If you're both in a mountain of debt --.
CHETRY: You're watching the most news in the morning.
(END VIDEOTAPE)
(COMMERCIAL BREAK)
CHETRY: Wow. What a beautiful shot this morning. 52 minutes after the hour. Wollman Trump Rink right there in Central Park this morning and people are really enjoying themselves out there. I just saw an attempt at a double axle. Not bad for just hanging out in the morning! Right now, it's about 33 degrees and it feels like 20 though. And our Rob Marciano is here. You know this music by the way "Paper Planes" by that new sensation from Sri Lanka, M.I.A. She had her baby. She had a boy.
ROB MARCIANO, CNN, METEOROLOGIST: Did she now? I've been waiting to hear that news for weeks now!
CHETRY: There you go. I hope you got her a present.
MARCIANO: That is fantastic. No, but she knows I've been thinking about her. And I guess they are open at Wollman Rink at this time of the day and certainly on a Monday morning, it's going to be empty and if you want to attempt a double axle, it's the time to do it.
All right. High pressure, Kiran, in control over the two-thirds of the country, at least for now. A little cold snap coming in but it shouldn't be too terrible for the folks who live in the northeast. The folks who live out west are heading there. You're going to run into some delays. I think L.A. to San Diego to San Francisco. Boy, it's been a nasty weekend out there trying to get the AT&T Pebble Beach deal and they couldn't do it yesterday. They'll try again today but it won't be a whole lot better either today or tomorrow.
That storm ejections to the plains. We'll see afternoon showers maybe a little windy conditions across parts of Texas. Look what happened over at Texas over the weekend. This is yesterday. A shot by a news photographer out of Austin. A fireball in the sky. I suppose it's a road race there. They are not running for their lives. This is not connected to two satellites that collided on Tuesday between the U.S. and Russia but, obviously, some sort of falling debris and it kind of takes a quick left turn there.
FAA says they don't know what it is. So Kiran, this is - my research by the way over the last hour has not yielded much information than that, except that those people running are not running from the falling debris. CHETRY: Right. You wanted to clear that up just in case. I love it. All right. I'm going to attempt a double axle if I can get out to Wollman Rink after the show. All right. That's not going to be pretty. Take it easy, Rob. See you later.
MARCIANO: All right. See you, Kiran.
ROBERTS: Every time I try the double axle, the wheels come right off.
Dating and debt. Looks and age might be just the recent beginning. A reason that he's not that into you could be because, oh, yes, those balances! 55 minutes after the hour.
(COMMERCIAL BREAK)
(MUSIC PLAYING)
ROBERTS: Well, we've all heard those commercials, right? I married my dream girl. I married my dream girl but she didn't tell me her credit was bad. Well in this economy, the list of turnoffs in the dating world has added one more. Debt. Carol Costello live in Washington, she's joining us with the story this morning. People are asking to see the bottom line these days, Carol.
CAROL COSTELLO, CNN CORRESPONDENT: Right you are, John. Remember the good old days when talking about your evil ex-girlfriend ruined your chances with a potential lover? Well, today, the biggest turnoff is he financial black hole.
(BEGIN VIDEOTAPE)
COSTELLO (voice-over): With Valentine's Day romance still lingering, love is definitely in the air. Unless you carry a great big balance. According to creditcards.com, would-be lovers would rather talk about their age, their weight or their love life than credit card debt.
JEFF GARDERE, PSYCHOLOGIST: It's one thing to carry around that emotional baggage. That's bad enough. But then when you have the financial baggage thrown in, this is something that may make your potential date or your first date do this.
COSTELLO: It's a sign of the times. In the new movie "Confessions of a Shopaholic" love is confounded by a mountain of debt.
UNIDENTIFIED FEMALE: Declined.
UNIDENTIFIED FEMALE: Can you try again?
UNIDENTIFIED FEMALE: Really declined.
UNIDENTIFIED FEMALE: How are you going to pay this debt?
COSTELLO: Ask around. Every one at this speed dating session is looking for love not a financial black hole. A few thoughts on just how much debt matters.
UNIDENTIFIED MALE: I consider finance is a big deal when I meet somebody, just like I consider hygiene a big deal.
UNIDENTIFIED MALE: You know, if she looks like Jessica Alba, you know, Jennifer Lopez, my heart. But the only way that it's really going to have an effect on me is if she continually asks me to borrow money.
UNIDENTIFIED FEMALE: How is he handling it? Is he stressing? I don't want to be part of a stressful situation. Is he asking me for money? Absolutely not!
COSTELLO: If you carry debt, that's darn depressing, but wait! If cupid nets you a kindred spirit you just may find love after all.
So if you're both in a mountain of debt, it can be a beautiful thing if you work together?
GARDERE: If you're both in a mountain of debt, it can be a beautiful thing to work together, especially if you're able to discuss it in a positive way, empowering one another and looking at strategies instead of just sitting around and crying about it.
COSTELLO: Hey. Couple that with a little Marvin Gaye and isn't that romantic? Let's get it on.
(END VIDEOTAPE)
COSTELLO: Yes, John, a budget is sexy now.
ROBERTS: I tell you. I'm knocked out by the whole thing. I think that's so terrific.
(LAUGHTER)
ROBERTS: Meanwhile, Kiran go ahead. Oh, people kissing in public, she can't stand it
CHETRY: I hate to see people suck face in public. He says it's because I have a deep rooted insecurity. It's not that.
ROBERTS: Sucking face. They were kissing. Public display of affection. It's nice. It's endearing. Carol, thanks so much.
CHETRY: Carol, you know you don't want to see people making out -
CHETRY: I don't like to think people suck face in public. I -- he says it's because I have a deep rooted insecurity...
ROBERTS: Sucking face.
CHETRY: ... about kissing. It's not that. ROBERTS: They were kissing. How about displaying affection. It's nice. It's endearing.
Carol, thanks so much.
CHETRY: Carol, you know you don't want to see people making out in public. You know you don't.
COSTELLO: Kissing is fun. You're a prude.
CHETRY: No.
(LAUGHTER)
ROBERTS: Time to go. Thank you so much for joining us on this AMERICAN MORNING. We'll see you back here again tomorrow.
CHETRY: If you hear the rest of the company, you wouldn't think I was a prune. OK. Right now here's "CNN NEWSROOM" begins right now with Heidi Collins.
