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American Morning
Secretary Clinton in Indonesia; Fixing the Housing Crisis; Obama's Economic Battle; Chimp Rampage 911; A-Rod Fans Forgive, Media Won't; Georgia's Sex Ed Showdown; Housing Starts, Permits Plunge; Facebook's Fine Print Outrage
Aired February 18, 2009 - 08:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KIRAN CHETRY, CNN ANCHOR: All right. He's coming up right on 8:00 here in New York. Breaking news this morning, more job cuts possibly connected to the struggling auto industry. These now from Goodyear. The biggest U.S. tire maker announcing 5,000 layoffs. That's nearly seven percent of its workforce. Goodyear also reporting a fourth quarter loss of $330 million.
Secretary of State Hillary Clinton is in Indonesia this morning. This is the second stop on her Asia tour. Clinton's trip is part of the administration's effort to strengthen economic ties with Southeast Asia, and she's also talking with Indonesia's president and foreign minister.
Here's some new pictures of Fidel Castro released. They appeared yesterday in the island's official newspaper. The images show the former leader of Cuba in a white track suit alongside the Chilean president. Fidel Castro has not been seen in public since undergoing surgery back in July of 2006.
And day 30 of the Obama administration. And even before the ink dried on the stimulus bill, the president already turning his attention to the $50 billion program targeting the housing crisis. The president will make that announcement today in Phoenix. Sources say that the government will cut monthly mortgage payments, allow more borrowers to refinance their loans and give bankruptcy judges greater power to modify mortgages. Our White House correspondent Suzanne Malveaux is traveling with the president in Phoenix.
And you've got some more details about this plan, so, you know, a lot of people are wondering this morning, what have you learned?
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Kiran, obviously, the White House plan has been shared with some folks on The Hill, so we're getting some details that are leaking out from congressional sources from Democrats.
First, it's going to -- they're going to use the $50 billion obviously to stem foreclosures. They're going to do it a number of ways. One of them is to subsidize mortgage companies to allow homeowners for their monthly payments to go down. That is something that is essential to the plan. Another thing they're going to do is create a program that allows homeowners who actually owe more than the value of their home to refinance. This is something that has not been done before. It's not allowed. The government offering this program to do exactly that.
They're also supporting legislation to change bankruptcy law, allowing judges to change the mortgage rates. That's something that lenders, mortgage companies very nervous about. But this is something that the administration supports, and finally, they want to establish industry-wide standards for Freddie Mac, Fannie Mae, those types of companies. So that if you get in trouble, what are these companies going to do. How are they going to respond?
A couple of things. Perhaps they could extend the terms of the loan or even give folks a short-term breaks on their payments. All of these things part of a comprehensive plan that the president will unveil later this morning -- Kiran.
CHETRY: And so, what we haven't heard is when these changes are going to kick in. Are we expected to get a little bit greater level of detail at today's announcement?
MALVEAUX: I think we're going to get some details. I'm not sure if we're actually going to learn when this is all going to kick in. This is obviously a part of the $50 billion that has already been authorized from the T.A.R.P. money. So, this is money that is available for use. And so this is something that they're going to have to work out with HUD, as well as many of the different states and homeowners. And obviously, Fannie Mae, Freddie Mac are going to be involved as well.
CHETRY: Suzanne Malveaux for us this morning with more details on this housing initiative, try to help many, many, facing foreclosures.
Thank you.
ROBERTS: Stephanie Elam "Minding Your Business." She joins us now with more on the president's plan. Break it down for us and tell us whether or not this is sort of thing that's going to fly.
STEPHANIE ELAM, CNN BUSINESS CORRESPONDENT: That's exactly what everyone wants to go, especially people who are in this dire straits. They want to know how this really going to affect me. So you've got $50 billion now. This is money coming from that Wall Street rescue plan money that we heard so much about last year.
The main point of this plan is to modify loans. You just heard Suzanne talking about that. They want people to stay in their homes. So, they can modify loans, bring these numbers down to something they can afford, that will be good. The government would subsidize interest rate reductions meaning that the banks would still get some money, but the interest rate would come down to a level that these people could afford. The banks probably would take a loss there. But it's probably better than people going -- foreclosing on their homes.
Also bankruptcy judges being allowed to modify mortgage terms. It's a nervous thing for the lenders, because what if they get cut down too low as far as the lender is concerned. That's what they're worried about, but obviously the Obama administration saying this would help people stay in their homes as well. Also, if you are a bank, if a bank is getting money from these T.A.R.P. funds, then they will have to come up with a loan modification program. And that's something that they're really pushing for here, because it will help keep people in their homes. And that's the whole idea.
The more people leave homes, foreclosures are bad. Banks don't want them to happen. It doesn't help out with property values around foreclosed homes, and then you have a glut of people who are just lost. So they don't have any place to live. So obviously that is all bad and that's what they want to stop.
ROBERTS: Beside you have going into bankruptcy coordinator, the judges are writing down the value of the mortgage. This is something that was opposed, strongly opposed by the Bush administration.
ELAM: Right.
ROBERTS: It's likely to get a lot of opposition in Congress.
ELAM: It's going to get a lot of opposition on both sides. Also because the banks don't want it to happen, either. They're afraid -- well, how low are you going to take this. How much money are we going to lose when you modify these loans? So that's going to be a sticking point for a lot.
ROBERTS: Yes. There's a consensus among some people that somebody needs to take a haircut here, whether it's the government that absorbs it, some mortgage companies that give it up or whether it's the mortgage holder -- or the mortgage payer that ends up taking this cost. Somebody's got to get to it.
ELAM: Yes. Just about everybody's going to have to take a bit of a trim on this one.
ROBERTS: Yes, absolutely. Stephanie, thanks so much.
ELAM: Sure.
CHETRY: President Obama is going to be announcing more details of his plan just outside of Phoenix, an area that's been hit hard by home foreclosures. So what does the mayor of the city hope to hear in today's announcement? We're going to find out when we talk to him live coming up in our next half hour.
ROBERTS: And the president using some campaign-style language to rally support for his economic plan. At the signing of his $787 billion stimulus, he told the crowd in Denver that the road to recovery will not be easy.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The road to recovery will not be straight. We will make progress and there may be some slippage along the way. It will demand courage and discipline. It will demand a new sense of responsibility that's been missing from Wall Street all the way to Washington. (END VIDEO CLIP)
ROBERTS: And the business world is quickly responding to the president's recovery plan. Business mogul Donald Trump talked with our Campbell Brown last night.
(BEGIN VIDEO CLIP)
CAMPBELL BROWN, HOST, "CAMPBELL BROWN: NO BIAS, NO BULL": President Obama today signed his stimulus package to try to get the economy back on track. What do you think about it? Do you think it's going to work?
VOICE OF DONALD TRUMP, BUSINESS MOGUL: Well, I think the economy's very, very sick. The economy is so much bigger than that stimulus package that maybe it's just -- it's a very small -- it's a very small token. But something has to be done. The biggest problem is, though, Campbell, that the banks are loading up with money from the government and they're not loaning it out.
If you have a credit rating of A plus and you want to build a project or do whatever you want to do, the banks aren't loaning out the money that they're taking in from the government. And until they start loaning out money and are forced to loan out money, we're never going to get better. This economy is going to be absolutely terrible, as it is now, and probably get worse. So, they have to force the banks to loan money.
(END VIDEO CLIP)
ROBERTS: The economy also hitting the Casino business really hard. Trump Entertainment Resorts filed for Chapter 11 Bankruptcy Protection just yesterday. And, of course, you know, Campbell asked Donald Trump about that last night. He said, look, I'm not on the board. I don't have anything to do with the company. They're using my name. They shouldn't be using my name. I got nothing to do with it. It's not me. Forget about it.
CHETRY: Exactly. But, you know, brand experts are saying that, you know, he really has taken a hit with so many of these things that are associated with Trump having financial trouble like many businesses and real estate. But, of course, he'll find a way.
ROBERTS: His real estate business is still doing well, though. We'll see if that continues.
Well, sex class at college. Uproar over questionable courses like male prostitution and queer theory. See who is outraged and working to get the classes shut down. It's 8-1/2 minutes after the hour.
CHETRY: An enraged chimp. A desperate woman.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Please, please. Oh, my God. (END VIDEO CLIP)
CHETRY: Sounds of an attack. What happened out there? Ahead on the Most News in the Morning.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
CALLER: Oh, my God, where are they? Where are they?
911 OPERATOR: I know, I know. It's OK. They're going your way, OK? They're going as fast as they can. They'll be there momentarily.
(END VIDEO CLIP)
ROBERTS: Brand new details and 911 tapes emerging this morning about the brutal chimpanzee attack that has left a Connecticut woman in critical condition.
The animal which once appeared in television commercials like this old Navy ad was apparently given an anti-anxiety drug just before the rampage took place. Jason Carroll joins us now with some details, and we have to warn you that you might find what you're about to hear very disturbing.
JASON CARROLL, CNN NATIONAL CORRESPONDENT: Yes. It is very tough to listen to. And, you know, despite everything that's happened, the chimp's owner still defending his chimp and everything that the chimp did. New this morning, the chimp's owner Sandra Herold is calling the incident a freak thing, but that her pet was not a horrible animal. Police released the 911 calls made by Herold as her pet chimpanzee suddenly snapped and mauled her friend. It happened in Stamford, Connecticut, on Monday. Again, much of what you are about to hear is very disturbing.
(BEGIN VIDEO CLIP)
SANDRA HEROLD, CHIMP'S OWNER: Send the police, send the police!
911 OPERATOR: What's the problem there?
HEROLD: The chimp killed my friend!
911 OPERATOR: What's wrong with your friend?
(END VIDEO CLIP)
CARROLL: That was the chimpanzee named Travis that you can hear screaming in the background. He was a house pet and considered harmless by his owner and some neighbors. That all changed after Travis used a key to escape from Herold's home. Herold called her friend, Charla Nash, who was familiar with the chimp, to help get him back inside. That's when Travis attacked.
Listen now as Herold begs the 911 operator to send police. (BEGIN VIDEO CLIP)
HEROLD: He's trying to attack me. Please, please hurry!
911 OPERATOR: OK. I need you to calm down a little bit. They're on the way.
HEROLD: They got to shoot him, please! Please hurry, hurry.
911 OPERATOR: If the monkey moves away from your friend let me know, OK, so we can try to help your friend.
HEROLD: No, I can't. She's dead. She's dead.
911 OPERATOR: Why are you saying that she's dead?
HEROLD: She's dead. He ripped her apart. I can't hold on much longer. I can't hold on. I can't. Please have them shoot him.
(END VIDEO CLIP)
CARROLL: And just want to clarify, the victim of the brutal attack Charla Nash is not dead. She was critically injured. Listen now to how police described what they saw when they arrived.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: We have one man down.
UNIDENTIFIED MALE: You see person down, chimps outside.
UNIDENTIFIED MALE: Hey listen, we have got to get this guy out of here. He's got no face.
(END VIDEO CLIP)
CARROLL: Police ended up shooting the chimp as it cornered an officer in a police car. As to what may have set the animal off, Herold told police that Travis appeared jittery earlier that day, so she gave him the anti-anxiety drug Xanax. It's unclear if the vet had authorized the use of that drug. A rabies test and an autopsy will eventually be performed.
Meanwhile, the owner's friend is struggling with horrific injuries in a Connecticut hospital. And in an interview airing just this morning, Sandra Herold said she did what I had to do. She says, "I did what I had to do," but that she will miss Travis for the rest of her life.
ROBERTS: You know, it's telling there in the police communications just how badly this woman was injured because they thought that she was a man.
CARROLL: That's right. Very extensive injuries apparently to her face. So much so that they could not recognize if it was a man or a woman when they got there and try to help her. ROBERTS: Unbelievable. Jason, terrible story. Thanks so much for bringing it to us -- Kiran.
CHETRY: All right. Well, a crush of cameras around A-Rod. How a steroid scandal is stealing the show. It's spring training, and how the superstar is struggling to put the whole mess behind him.
And also the educational value. Is there educational value in a class called queer theory? Who's taking it, and who's trying to get it shut down. The uproar over college sex classes. It's 15 minutes after the hour.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
ALEX RODRIGUEZ, NEW YORK YANKEES 3RD BASEMAN: The last 15 months have been very, very tough. I mean, I've been through divorce. I've been through tabloids. You name it. And I miss playing baseball. And I miss simply being a baseball player.
I think there's a tremendous opportunity for me to look in the mirror and be a better teammate to my guys over there. Be a better player to my fans, a better human being. I think that's my opportunity. I screwed up. Big time. But I think the only thing I ask from this group today and the American people is to judge me from this day forward.
(END VIDEO CLIP)
CHETRY: That was Alex Rodriguez at Steinbrenner Field in Tampa. Baseball's biggest star and highest-paid player trying to move on from a steroid scandal that could haunt him until the end of his career. And while the media won't let it go, many younger fans seem to be willing to forget.
CNN's John Zarrella joins us live from Yankees spring training this morning.
It's interesting to hear him say, judge me from this day forward, because unfortunately in baseball, that's not how it works, right? Those are stats that are on the books.
JOHN ZARRELLA, CNN CORRESPONDENT: Yes, and that's certainly going to be the question, Kiran, going forward is how will those stats going forward be handled. But you know that commercial where all those people have that wireless network following them around? Well, Alex Rodriguez has his own network that follows him everywhere, reporters and cameras, and they were all over him yesterday.
(BEGIN VIDEOTAPE)
ZARRELLA (voice-over): On the field, the New York Yankees' players went through their early spring training drills. Young fans with baseballs in hand hoped for an autograph, preferably from a star.
CHARD KNIGHT, WESTPORT, CONNECTICUT: Jeter and A-Rod.
ZARRELLA: Jeter and A-Rod.
KNIGHT: Jeter because he's a good fielder, nice shortstop. A- Rod because he's -- he got a lot of good hits last year.
ZARRELLA: But all this was an appetizer. The main course and all that really mattered on this day, Yankees' slugger Alex Rodriguez. What more would he say about his admission of steroid use? His fans came to support him. The youngest, most forgiving.
UNIDENTIFIED GIRL: I'm happy, because he was honest about what he said.
STEVEN AMERSON, OAKSDALE, NEW YORK: I know that what he did that he knew it was wrong. And, well, I forgive him.
ZARRELLA: Reporters camped everywhere broadcasting live hours before Rodriguez arrived.
UNIDENTIFIED FEMALE: About 150 to 200 members of the media, including major news organizations.
ZARRELLA: Even media from Taiwan are interested.
UNIDENTIFIED MALE: You can't avoid the topic.
ZARRELLA: Photographers positioned themselves to get every A-Rod angle, even a head shot, the top of his head. It was the media on steroids. When the A-Rod moment arrived, he calmly and candidly answered questions, saying from 2001 to 2003 his cousin injected him with a substance they got from the Dominican Republic. He was young and stupid. And hasn't done it since, he said.
RODRIGUEZ: It was two guys doing a very amateur and immature thing. And we probably didn't even take it right. I'm here to say that I'm sorry. I'm here to say that in some ways I wish I went to college and got an opportunity to grow up.
ZARRELLA: An hour later, Rodriguez headed to the parking lot, signing autographs as photographers scrambled for more shots.
The media's insatiable appetite still not satisfied. The Yankees' manager was surrounded and the players, too. Rodriguez knows he will be dealing with this for some time. Longer, perhaps, than if he played anywhere other than New York, other than in pinstripes and Yankee blue.
(END VIDEOTAPE)
ZARRELLA: Now, while the Yankees want to put this behind them and move on to the business of playing baseball and getting for the season, it certainly not over yet and won't be for a long time. In fact, this afternoon at 1:30, Derek Jeter, who is emblematic of the Yankees, really the face of the franchise will hold a news conference here to address the issues of the Yankees moving on and Alex Rodriguez.
Kiran?
CHETRY: John Zarrella for us this morning. Thanks, we'll see.
ROBERTS: Ugliness on the hardwood at a high school hoops game in Montgomery, Alabama. Take a look at this. It started with a foul and then a shove. Both benches cleared, and so did the stands.
Players throwing punches at fans. Fans taking swings at players. One player was running around the court without a shirt just hitting people. At least 10 teenagers were reportedly arrested. There weren't enough players left to finish the game. Hmmm, sportsmanship at its finest.
CHETRY: Yes, exactly.
ROBERTS: Look at that.
CHETRY: Not good. Not good at all.
ROBERTS: Scrapping it up there.
President Obama right now outside Phoenix about to offer help to homeowners. Phoenix hit hard by foreclosures. So what does the city's mayor want to hear from the president? We'll ask him. It's 22 minutes after the hour.
Sex classes on campus.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: We're old enough to make our own decisions about classes that we want to take.
(END VIDEO CLIP)
CHETRY: Who is teaching them? Who is taking them? And who is fighting to make them go away.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Yes, you heard right.
(END VIDEO CLIP)
CHETRY: Ahead on the "Most News in the Morning."
(COMMERCIAL BREAK)
ROBERTS: Can you hear it now. In Georgia's state capital, it's the battle of taxpayer dollars versus morality. Some conservative lawmakers are lived over some state university class subjects, including male prostitution and oral sex. It's giving a new meaning to the phrase "liberal art." You bet it is. Carol Costello is looking at both sides of the debate. CAROL COSTELLO, CNN CORRESPONDENT: John and Kiran, a question. If your tax dollars in part pay professors to teach your kids, should you have a say in what classes they teach? Two Georgia state lawmakers think you should.
(BEGIN VIDEOTAPE)
COSTELLO: It's a hot topic at Georgia State University, sex, not among students, but among professors and politicians.
CHARLICE BYRD, GEORGIA STATE ASSEMBLY: Did you know that the state universities offer special interest classes and expertise on male prostitution? Queer theory? And oral sex? Yes. You heard right.
COSTELLO: State Representative Charlice Byrd is outraged and says Georgia taxpayers are footing the bill for this. She and fellow Republican Calvin Hill along with a Christian coalition want the classes canceled and the instructors fired.
BYRD: Someone should have the freedom to learn whatever it is that they want, but these types of classes or experts that are in our university system should be taken out.
CALVIN HILL, GEORGE STATE ASSEMBLY: Teaching an entire semester on this, my taxpayers, my constituents believe that is a total waste of their money.
COSTELLO: Their targets are listed on Georgia State's Web site, Mindy Stombler, teaches sexuality and society, one area of her research, the social meaning of oral sex.
CLINTON: I did not --
COSTELLO: As in how oral sex is defined in our culture.
MINDY STOMBLER, LECTURER, GEORGE STATE UNIVERSITY: I would argue that ever since the Clinton/Lewinsky scandal it's been kind of unclear what actually counts as sex anymore for a lot of Americans.
COSTELLO: Another target the University of Georgia's course on queer theory. UGA defends the course saying "the study of queer theory, the representation of homosexuals in literature and the world is a respected course of study throughout the nation." And it's not like students aren't exposed to sex and gender issues.
Watch the afternoon soap "As the World Turns" lately? It recently broke taboo by showing gay intimacy on TV. And then there's Katy Perry and her inescapable hit song.
KATY PERRY, SINGER (SINGING): I kissed a girl and I liked it.
COSTELLO: Still students' reactions to learning about such issues in class are mixed.
UNIDENTIFIED MALE: That's this kind of something that you learned. It's not something that you're taught.
UNIDENTIFIED FEMALE: We're old enough to make our own decisions about classes that we want to take.
UNIDENTIFIED FEMALE: If you would like to research on oral sex and male prostitution, you can go on google.com.
UNIDENTIFIED FEMALE: It's a great opportunity for students to get that in the classroom and not outside.
UNIDENTIFIED FEMALE: Me, I'm a Christian. And if my mother heard about there are classes about being queer here, she'd probably withdraw me.
(END VIDEOTAPE)
COSTELLO: Keep in mind that Georgia State lawmakers have no power whatsoever to fire professors or to cancel classes. They do, however, have control over the overall budget for Georgia colleges and universities. And right now, there's a $2.2 billion shortfall -- John, Kiran.
CHETRY: Carol Costello for us, thanks. We're coming up at 28 minutes past the hour right now. A check of the top stories this morning.
President Obama spoke with Afghan President Hamid Karzai by phone for the first time since being sworn in. Karzai's office said the two talked about security issues and Afghanistan's upcoming presidential race. Last week, he said civilian casualties in Afghanistan are a major source of tension with the U.S.
And President Obama made the call on the same day that he said 17,000 more U.S. troops will be deployed to the war zone in Afghanistan. In an interview with Canada's CBC, the president said that the situation there is deteriorating, but that the U.S. can succeed.
(BEGIN VIDEO CLIP)
OBAMA: I think Afghanistan is still winnable in the sense of our ability to ensure that it is not a launching pad for attacks against North America. I think it's still possible for us to stamp out al Qaeda, to make sure that extremism is not expanding, but rather is contracting. I think all those goals are still possible, but I think that as a consequence of the war in Iraq, we took our eye off the ball. We have not been as focused as we need to be on all the various steps that are needed in order to deal with Afghanistan.
(END VIDEO CLIP)
CHETRY: Administration officials say that the president is expected to make a decision on cutting U.S. troops in Iraq within weeks.
And Mexico's use of soldiers to crack down on drug trafficking giving hundreds there a reason to protest. People blocked roads into the U.S. and accused the army of abusing residents. Officials say that the protests were organized by the drug cartels themselves.
Well, in just a few hours, President Obama will announce details of his $50 billion plan to help struggling homeowners. He's going to be doing this just outside of Phoenix, often called ground zero in the mortgage meltdown.
Phoenix is home to about 1.5 million people. Unemployment there at 6.3 percent. Last year, though, the city ranked fifth in foreclosures, one out of every 17 homes in trouble. Phoenix Mayor Phil Gordon knows these numbers well. He joins us live from Phoenix this morning.
And, Mayor, thanks for being with us.
MAYOR PHIL GORDON, PHOENIX: Thank you, Kiran.
CHETRY: I'm just going to tick through a few of the highlights that our White House correspondent Suzanne Malveaux gleam for us about what this would entail, and then I'd like you to explain how it could help your city. Maybe $50 billion to help stem foreclosures, the government would provide some subsidies to mortgage companies to help lower the monthly payment for homeowners and also to allow more homeowners to stay in their homes if they're underwater, as they put it, allowing them to refinance perhaps at the current value of their home. How would this help your city right now?
GORDON: Well, there's such an amount of foreclosures that both property taxes have declined. People losing their homes, have lost their jobs, the adjustable rate mortgages are so high that people can't afford to pay that, even want to pay. So, this would allow people to stay in their homes, stabilize the housing market, and then, therefore, increase the sales and the property tax base which would help all sectors, private and public.
So, it's critically important, and I'm very, very grateful that the mayor, the president has not only focused on the housing market, but understands cities and understands urban cities in particular.
CHETRY: Yes, and clearly, no one disputes that there's a problem. There's probably going to be some debate over whether or not this is realistic and how it would actually work in practical terms. He's talking about making the centerpiece these loan modifications, where he would perhaps be able to get the federal government's help in lowering these monthly payments to around 30 percent.
So, practically speaking, how would they determine who qualified, what type of income these people are really bringing in, and how they would actually make it work?
GORDON: Well, the banks and the portfolio holders of the home mortgages have all that information. And, in fact, if we don't do that, it's going to collapse even more, not only in Arizona, in Phoenix, but across the nation, and just continue to go downward. So, taking the information that the banks have in terms of level of income, filling out the forms, transparency and accountability, and today's computers, that's not the difficult issue.
It's really getting Congress to come together and acknowledge. This is the problem. If we don't solve the housing crisis, it won't matter about jobs, about public safety, about any of the private sectors that have been receiving the bailouts because people need a safe place to live and raise their children and go to school. And that has not stabilized at this moment.
CHETRY: Yes. And we talked about the domino effect of even people who can afford their mortgages and are able to make their payments as homes around them drop into foreclosure, their own values are dropping as well. Well, we certainly hope to see a turnaround for your city and others that are suffering as well. I'm sure you'll be listening as the president today outlines more details of this plan.
Mayor Phil Gordon from Phoenix, thanks for joining us.
GORDON: Thank you very much.
JOHN ROBERTS, CNN ANCHOR: And just in to CNN, numbers that give us a glimpse into the state of the housing market. Housing starts and building permits. Stephanie Elam "Minding your Business." She joins us now with the details and worse than expected?
ELAM: Yes, taking a look at the housing starts, we'll start there. They were expected to drop to 530,000. They actually dropped to 466,000. So, this is down 15.8 percent. This is also down from the previous month of 550,000. So not good news there. And also taking a look at building permits here for January. 521,000, that is down nearly five percent from the revised December number, which was 547,000 for that month.
So, just to give you an idea, the reason why we look at this, I know sometimes when you hear - those of us who cover business news, we use terms like building permits, housing starts, and you kind of just tune out. But the reason why we pay attention to this, is it really helps us get an idea of what is going on with the housing sector. It lets us know that maybe there are some construction going on there and maybe there are some people who are building homes. An idea like that gives us an idea of the overall economy. Right now, we can see that we're still in dire straits. I don't think these numbers are really surprising anyone at this point.
ROBERTS: And this is a record low, right?
ELAM: A record low, yes. So we're looking at, I mean, if you think about it, you've got all of these foreclosed homes that are flooding onto the market. People aren't building. They are afraid to spend money to even do any upgrades to their homes. So, it's not surprising to see that building permits are down when you take a look at the overall picture there.
ROBERTS: Everything is kind of frozen, isn't?
ELAM: Everything is -
ROBERTS: From credit markets to housing starts.
ELAM: Hanging at a low, low level right now.
CHETRY: No doubt I'm sure the president will be referring to those numbers today as he makes his pitch for homeowners.
ELAM: I'll bet on it.
CHETRY: Stephanie, thanks so much.
ELAM: Sure.
ROBERTS: Well, a big about-face on Facebook. An overnight policy change that affects your online privacy. See what it means. Coming up on 35 minutes now after the hour.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": There are a lot of new taxes coming. California state legislators want to solve our state's current deficit. They want to tax marijuana. Oregon wants to increase the tax on beer. And New York wants to tax Internet porn. You know what that means, by the end of spring break this whole thing could be paid for.
(END VIDEO CLIP)
CHETRY: Thirty-eight minutes past the hour now and time to fast- forward to see what stories will be making news later today.
All eyes will be on Wall Street when it opens for business a little less than an hour from now. The Dow plunged 298 points yesterday even as President Obama signed the economic stimulus bill into law. Traders still shaky over the future of banks and the big three Detroit autos. Dow futures, though, in positive territory so far.
We're also watching for a cruise ship full of stranded tourists to perhaps get moving again today, after it ran aground in Antarctica. "The Ocean Nova" carrying 125 people, including 21 Americans, they were on a trip exploring the polar circle. The cruise company says the ship was pushed into rocks by extremely high winds.
And emergency personnel who did (inaudible) responding to the U.S. Airways' plane that landed in the Hudson River are being recognized today. They will be honored at a ceremony this afternoon by Homeland Security secretary Janet Napolitano and also the head of the Coast Guard Admiral Thad Allen.
And severe weather capable of producing tornadoes now moving across the south and southeast. Our Rob Marciano is keeping an eye on all of that for us this morning. Hey, Rob.
ROB MARCIANO, AMS METEOROLOGIST: Hi, Kiran. This is some of the energy that's been pounding California for the past few days, now moving into the plains and the Midsouth and the Southeast for that matter. A lot of red on the map here. Storm prediction center has issued a moderate risk for seeing thunderstorms that could develop not only tornadoes but big ones, and this one actually stretches into much of the Northeast.
(WEATHER REPORT)
ROBERTS: A story developing all morning long, Facebook, the giant online community of more than 175 million users is now taking back changes it quietly made to its privacy rule. It faced a mutiny from tens of thousands of people after the story went viral on the Web. The policy seemed to grant Facebook rights to use anything you upload including all your private pictures forever. This morning the company's chief privacy officer reacted to all the outrage.
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CHRIS KELLY, CHIEF PRIVACY OFFICER, FACEBOOK: Well, we think that there was, you know, some confusion about what we were actually trying to do, and that we were accused of a lot of things that we weren't trying to do at all, but it's incredibly important for us to sort of get this right. And so Mark put up a new posting last night explaining that we've opened a group called Facebook rights and responsibilities that will allow our users to express what they want our terms of service to be going forward and in the meantime we wanted to make it crystal clear that the old terms of service will apply.
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ROBERTS: So now Facebook says it will not share your photos or anything else with anyone. They've even created a new group called Facebook rights and responsibilities so that you can weigh in. But they think they may modify the policy in the future as well based on concerns that they have and who knows where that actually go.
CHETRY: That's right. And also I think that they certainly learned a lesson about changing the terms of the agreement without alerting people about the use, when you logged on today, there was a big warning saying it's different.
ROBERTS: The big problem with Facebook is that when you give your friends access to your page, all that information goes all over the place.
CHETRY: That's right.
ROBERTS: And how do you ever get it all back?
CHETRY: And they acknowledged that they can't. And so I guess, that's also part of also why they want to change the policy.
ROBERTS: Keep watching this story, it's a very important one because so many people are involved.
After President Obama talked about the poor condition of a school on television, a student writes to him for help, save my school! She'll tell us what happened, coming up next.
And new information on the superbug that killed a Brazilian supermodel. Dr. Sanjay Gupta on the dangerous infection known as the superbug. Is it really untreatable?
Forty-two minutes now after the hour.
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ROBERTS: President Obama has pledged to make rebuilding our nation's schools one of his top priorities, saying education funding is vital to the country's economic recovery. He recently spotlighted one particular school as an example.
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OBAMA: Well, I visited a school down in South Carolina that was built in the 1850s. Kids are still learning in that school. As best they can. When the railroad -- when -- it's right next to a railroad and when the train runs by, the whole building shakes and the teacher has to stop teaching for a while.
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ROBERTS: He was talking about J.V. Martin Junior High School in Dillon, South Carolina. Tysheoma Bethea is an eighth grader there who just wrote a letter to Congress asking for economic stimulus money for her school. She's joining me this morning now along with the superintendent of her school district, Ray Rogers.
Tysheoma, let me ask you, why did you want to take this extraordinary step of writing a letter to Congress?
TYSHEOMA BETHEA, 8TH GRADER AT J.V. JUNIOR MARTIN HIGH SCHOOL: I wanted to take the step because I see all this money being passed around for the stimulus bill, and the majority of it was going to places that already had money, and it was skipping over the schools.
ROBERTS: You said in this letter that people were starting to see your school -- let me quote here as, "a hopeless uneducated school, which we are not. We finally want to prove to the world that we have a chance in life just like other schools. But because of the conditions that we're in now, we cannot succeed in anything." Tell us, Tysheoma, what are the conditions like there?
BETHEA: The conditions are that we do not have the proper books. We have the teachers and they struggle every day to help us get our good education. But I think if we had a more advanced school, or better learning areas, that it could help improve our education.
ROBERTS: You know, Ray, let me come to you here. The only reason why you knew about the letter was because she went to the principal, Amanda Burnett, asking for a stamp.
RAY ROGERS, SUPERINTENDENT: Actually, she took it upon herself, after she heard the president's message, last Monday night, to go write a letter in hopes that the Congress or the president would not forget the rural South and across the nation. The school situations that need new facilities and updated facilities, and I think that's what Tysheoma was referring to in her letter.
ROBERTS: So, where did this letter eventually end up?
ROGERS: From the information I have, it ended up on President Obama's desk.
ROBERTS: Wow. Ray, the last time I was there, as I said, it was a year ago January, you had ambitious plans for building some new facilities, not just renovating the old facilities, because they are more than 100 years old. What kind of state is that plan in now?
ROGERS: Well, our community's come together to try to help our situation, but right now, we kind of are at the mercy with what's going on with the banking industry.
ROBERTS: Tysheoma, you were there, as I understand it, when then-Senator Obama, who was campaigning for the presidency, came through and spoke at your school. What kind of inspiration was that particular visit for you in terms of what you want to do with your life?
BETHEA: Well, it sent a very inspirational point of view to me. And it excited me to be the first female president of the United States. Because I would love to help schools and other nations and around the world.
ROBERTS: Well, certainly it sounds like your heart is in the right place as you pursue that lofty goal. Tysheoma Bethea and Ray Rogers, it's great to see you. And thanks very much for being with us this morning. Good luck, by the way, in trying to get some of that money.
ROGERS: OK. Thank you for having us.
BETHEA: Thank you.
CHETRY: Well, still ahead, sure you love your dog, but would you pay $155,000 to have him cloned, especially in this economy? Well, we're going to meet the couple who did. We're going to see if their new puppy is really just like their old puppy and really worth all that dough.
And after a superbug killed a supermodel, there are new questions surrounding this rapidly spreading infection. Is it impossible to treat? And are you at risk? Dr. Sanjay Gupta weighs in. It's 49 minutes after the hour.
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CHETRY: Well after Brazilian supermodel was killed by an infection now known as the superbug, there are new concerns about this drug-resistant bacteria, how common is it, and if you wind up in a hospital, could you be in danger of catching an infection like this as well? We're "Paging Dr. Gupta," CNN's chief medical correspondent, live in Atlanta. And her story was just so heartbreaking. I mean, somebody who I think had a urinary tract infection and ended up dead.
DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: Yes, I know, it spread very quickly, and the story was hard to hear about how quickly it affected her. This - these superbugs, these Gram-negative bacteria as you call them are sort of poised to be a very, very big problem. A lot of people have heard about MRSA, methicillin-resistant Staph aureus and that has become something well known over the past few years. What you are looking at there is also poised to be sort of the same thing over the next few years.
They have hard-to-pronounce names, such as acenobacter, klebsiella, pseudomonas, but there are two things to sort of keep in mind about these bacteria, one is that they are increasing, certainly in numbers, especially in hospitals and as things stand now, they're nearly impossible to treat. What happened with Mariana Bridi, she got the infection, it spread from her urinary tract into her kidneys and subsequently throughout her body. We heard the story about she had to have her hands and her feet amputated as those vessels became infected as well.
So that just gives you an idea of a young, healthy person and how overwhelming this was. A couple of problems here, you know, antibiotics, there's not a lot of antibiotics sort of in the pipeline, sort of coming down the pipeline to possibly treat these infections, so if you get one, it's really about trying to control it while someone's in the hospital, Kiran.
CHETRY: Yes, what's so scary about that also is how quickly it can take you from, you know, just feeling a little off to practically on the brink of death and whether or not they can do anything to stop the spread.
GUPTA: If someone is in the hospital, one thing that is always practiced, and I think practiced even more diligently on someone who has a superbug, is often those patients are isolated. They are put in separate rooms so they are not spreading the same infection to other patients certainly. Keep in mind, hospitals are very dirty places. It's where the worst bacteria live.
So, you got to be careful when you're in the hospital. The second thing is sort of this thing that I was alluding to, you have to encourage more research probably towards making new antibiotics. We are starting to see these antibiotics becoming more and more resistant as antibiotics are over prescribed in the community and more resistant strains emerge and you got to make new antibiotics and you also got a stop over prescribing antibiotics in the first place and it's a double-edged sword, I think and we're becoming more cognizant of it over the past couple of years.
CHETRY: Right. And you got to use them the right way. When your doctor says take them all even if you feels better, you just got to do that. GUPTA: If you only use few days' worth, what happens is that the very worst bacteria are allowed to replicate and grown even more. That's part of the problem.
CHETRY: Yes. Sanjay, it's great to see you. Thanks.
GUPTA: Thanks, Kiran.
ROBERTS: Well how much would you be willing to pay for a dog? How about $155,000? The extremely high price of re-creating puppy love.
ROBERTS: It's 55 minutes after the hour.
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ROBERTS: A Florida family so broken-hearted over the death of their dog that they paid $155,000, yes, $155,000, to have him cloned. So, the big question, is he really as lovable as the original? And in a state where millions of unwanted animals are euthanized every year, was it the right thing to do? CNN's John Zarella caught up with the people and their carbon copy puppy.
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ZARELLA (voice-over): He looks like any other 11-week-old purebred yellow lab, but Lancy here is quite different. He's a lab born in a lab. A cloned pooch.
UNIDENTIFIED MALE: And he ran to us, I mean, it's like waiting five years for Christmas. And all of a sudden Christmas is here.
ZARELLA: Five years ago, Edgar and Nina Otto had their dog Lancelot DNA preserved just on the off chance that someday after he died, they could, in a way, bring him back. A year ago Lancelot died. But is it really the same dog? Is it?
UNIDENTIFIED MALE: Boy, it's about as close as you can get.
UNIDENTIFIED FEMALE: Right.
ZARELLA: Lancy didn't come cheap. The Otto's paid Bioarts International $155,000 to have Lancy cloned at a laboratory in South Korea. Bioarts ran five auctions. The Ottos won one of the cloning opportunities.
UNIDENTIFIED FEMALE: Come here, sweetie.
ZARELLA: Lou Hawthorne is CEO of Bioarts. The dogs with him are two of the four clones of his dog Missey. They were cloned to preserve DNA implanted in another dog's egg as a test project before Bioarts launched the auctions.
LOU HAWTHORNE, CEO, BIOARTS INTERNATIONAL: This is a complicated technology. It has to be done right. We're talking about sentient beings here with the capacity for suffering. They have to be made perfectly. And that's our commitment is to make them perfectly.
ZARELLA: But should they be made at all?
UNIDENTIFIED FEMALE: And look at you. You could be a clone, too. A clone of I'm not sure what.
ZARELLA: With more than three million dogs and cats a year being euthanized, the Broward Humane Society's Sherrie Waechter says that kind of money would go a long way.
CHERIE WACHTER, HUMANE SOCIETY OF BROWARD CO.: It's a lot of money. A lot of spayed and neuters could be done to prevent the birth of unwanted pets.
ZARELLA: The Ottos who have nine other dogs and donate hundreds of thousands to animal shelters couldn't be happier.
NINA OTTO, LANCY'S OWNER: I only was hoping to get the essence of Lancelot back. I know I've gotten that. Anything else is icing on the cake.
ZARELLA: The Ottos say if they had to do it again, they would. And who knows, someday maybe they'll be cloning reporters. Although most people would say, one of me is enough. John Zarella, CNN, Miami.
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ROBERTS: You can never get enough of John Zarella.
CHETRY: That would solve all your problems, you talked about that before, you could be in more than one place at once and get everything done.
ROBERTS: Perfect.
Well, thanks so much for joining us in this AMERICAN MORNING. We'll see you back here bright and early tomorrow.
CHETRY: Right now, here's CNN NEWSROOM with Heidi Collins.
