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American Morning
President Obama Unveils Lifeline for Struggling Homeowners; How the Housing Help Breaks Down; Roland Burris Defends Himself; President Obama Leaving for His First Overseas Trip; $75B Lifeline for Homeowners; Hell on Heels; Dangers in Afghanistan
Aired February 19, 2009 - 06:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)
KIRAN CHETRY, CNN ANCHOR (voice-over): Help is on the way.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Millions of families resigned to financial ruin, a chance to rebuild.
CHETRY: The president pitches his multibillion-dollar foreclosure fix. Tens of millions were waiting. Many say it's overdue. Many will be left out.
OBAMA: This plan will not save every home.
CHETRY: Today, your iReports answered.
PATTY LEWIS, WILLOW GROVE, PENNSYLVANIA: We do not overspend. Our house is our priority.
CHETRY: How much? How soon? And whether your home is in line.
LEWIS: Our voices need to be heard now.
CHETRY: On this AMERICAN MORNING.
(END VIDEO CLIP)
CHETRY: Well, hello and thanks for being with us. It's Thursday, February 19th. I'm Kiran Chetry along with John Roberts, and we're getting new details and more details this morning of exactly how this anti-foreclosure plan is going to work.
JOHN ROBERTS, CNN ANCHOR: Yes. You know, and potentially millions of people might be helped here, but there are a lot of rules and regulations regarding this program. Very complicated stuff. We'll walk you through it all this morning.
First of all, though, this morning, President Obama traveling to Canada this morning, his first foreign trip since taking office. During his roughly seven hour visit, Mr. Obama will meet with Prime Minister Stephen Harper and other government leaders. Free trade, energy and the economy will be the dominant issues in talks there. Canada is a traditional first stop for a new American president.
A political cartoon in the "New York Post" setting off charges of racism today. It shows a chimpanzee being gunned down by police along with the caption, "Now they have to find someone else to write the next stimulus bill." The paper says the cartoon is simply a parody of Washington politics that plays out the chimpanzee attack in Connecticut. But civil rights activists including Al Sharpton say it invokes historically racist images and suggesting that an ape wrote President Obama's economic stimulus package.
And Switzerland's largest bank admits that it helped American taxpayers hide money from the IRS. As part of a deal with the Justice Department, UBS has agreed to pay $780 million in fines and restitution. The bank will also turn over the names of some U.S. customers suspected of having secret bank accounts.
CHETRY: Also, now to President Obama's brand new plan to keep millions of Americans in their homes. It's a $75 billion investment meant to prop up the economy and offer hope to people gripped by fear that a foreclosure notice is headed their way. But don't be fooled because not everyone is going to benefit from the president's new plan but will you? That's the question that we're aiming to answer today and we're also tapping in to CNN's resources to do it.
All morning we're talking to the best money team on television. We have Ali Velshi, Gerri Willis, Stephanie Elam with us. And we also have expert guests coming in to answer the questions that you are going to be asking by heading to our Web site, CNN.com. We're going to get to all of that in a minute. But first, President Obama on the problem and the plan to fix it.
(BEGIN VIDEO CLIP)
OBAMA: The plan I'm announcing focuses on rescuing families who played by the rules and acted responsibly. By refinancing loans for millions of families in traditional mortgages who are underwater or close to it, by modifying loans for families stuck in subprime mortgages they can't afford as a result of skyrocketing interest rates or personal misfortune, and by taking broader steps to keep mortgage rates low so that families can secure loans with affordable monthly payments.
When the housing markets collapsed, so did the availability of credit on which our economy depends. And as that credit has dried up, it's been harder for families to find affordable loans to purchase a car, or pay tuition and harder for businesses to secure the capital they need to expand and create jobs. In the end, all of us are paying a price for this home mortgage crisis and all of us will pay --
(END VIDEO CLIP)
CHETRY: President Obama announcing his mortgage plan in Arizona yesterday so how is it being received? Candy Crowley picks up that part of the story.
(BEGIN VIDEOTAPE)
CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT (voice-over): We found Jim Mulvey, a New Jersey homeowner, at one of the three jobs he works to support his family and pay his mortgage on time, and he's unhappy with the president's plan.
JIM MULVEY, GILLETTE, NEW JERSEY: It is very frustrating to see when you know you're doing things the right way that other people might be certainly capable of doing things the right way themselves are not doing it.
CROWLEY: In a letter to the president, Republican leaders John Boehner and Eric Cantor said they look forward to working with him then asked six questions designed as much to make a point as get answers, including what does the plan do for the 90 percent of mortgage holders not in default and will federal aid go to banks who gave out mortgages they shouldn't have?
The president clearly understands the political and practical dynamic here. His rollout of the mortgage rescue plan included a section on who he will not save.
OBAMA: It will not help dishonest lenders who acted irresponsibly, distorting the facts -- distorting the facts and dismissing the fine print at the expense of buyers who didn't know better. And it will not reward folks who bought homes they knew from the beginning they would never be able to afford.
CROWLEY: Since the details of eligibility will not be released for two weeks, it remains unclear how the program will weed out the irresponsible and the dishonest, those who played the system and lost. But the president hopes people will see this package as assistance for individuals that will help everyone.
OBAMA: It will prevent the worst consequences of this crisis from wrecking even greater havoc on the economy.
CROWLEY: There are times when Jim Mulvey does worry about what's ahead, whether the havoc will pull him under, but even if, he believes he can pull himself out.
MULVEY: I'm not alone working a couple of jobs. A lot of people are doing so. I'd much prefer -- if I'm able much prefer that than to be getting a handout.
CROWLEY: The census bureau says 75 million Americans own homes. This plan will help up to nine million.
Candy Crowley, CNN, Washington.
(END VIDEOTAPE)
ROBERTS: Let's take a little bit deeper on this. Here's who benefits from this plan.
The administration says five million people whose mortgages are Fannie, Freddie guaranteed will have a chance to refinance. Another four million people will be able to modify their home loan terms. As for who gets nothing, homeowners who are "underwater by more than five percent." They're out of luck. That's when their mortgage is worth more than the house is. That's what's being underwater. Stephanie Elam here "Minding Your Business." A lot of this very complicated in terms of who's eligible and how they go about taking advantage of this. So, help us out here.
STEPHANIE ELAM, CNN BUSINESS CORRESPONDENT: Yes. It's going to take people some time to get through this and look at what this really means for them. And there's basically two parts here.
First of all, the government wants to help more homeowners refinance, basically getting them down to mortgages that they can afford with new, lower interest rates. The other part of this is giving incentives to not just the homeowners but also to the lenders, to the banks and the financial institutions out there, to bring these mortgages down to more affordable rates.
Now, the plan is still voluntary, but many believe that because of these incentives, it's more likely that both the bank and also the home buyers will try to work with this plan and make it work out for them. Now, if you're looking to refinance, because that's what some people fall into this category, that's going to target people who have basically kept up on the mortgage payment. So making these payments all the time but it's getting hard for them to do it, they couldn't refinance because of the falling value of their home. So because of that they want to help them out.
If you owe more than your home is worth, you won't qualify for refinancing. At this day and time, you really have to have about 20 percent equity in your home for that to qualify for you.
Also, if you have a jumbo mortgage, this is not going to apply to you as well. Jumbo mortgage, basically, anywhere above $417,000 or so has been about the limit there.
Now, for those who need to modify their mortgage, this is a different group here. Those are for people who are in default or at risk of going into default and for those a high combined mortgage debt versus income ratio. That's what they'll be looking at there. And so they're looking to see if they can help those people out.
CHETRY: Right.
ELAM: And so there's a lot of qualifications that we're looking at here.
CHETRY: Right. And the president has said we can't help everybody. If you have no income source and you're about to lose your home, it's not going to work out for you under this plan either.
ELAM: Right.
CHETRY: And if this is investment property, meaning it's not your primary home, it's not going to work out for you either. But the interesting thing that you refer to that people who are having trouble right now because they don't have 20 percent equity in their home anymore...
ELAM: Right.
CHETRY: ... because of the falling house values, they might be able to qualify now.
ELAM: Right. Well, and if they can show that at some point they did have that, you know, within not during the whole bubble part but if they can show that they did have equity that they were making the payments that were good, consistent homeowners, then they have a better chance of having help there.
ROBERTS: OK, stay right there because we've got an iReport that we want to play for you and get you to respond to.
ELAM: Right.
ROBERTS: We want to hear from you at home on this home mortgage plan. Send us an e-mail or an iReport. Go to CNN.com/am.
IReporter Patty Lewis of Willow Grove, Pennsylvania, submitted this video. Let's listen.
(BEGIN VIDEO CLIP)
LEWIS: What about the unemployed, unemployed for over a year and are now facing foreclosure and haven't replenished their income? We do not overspend like a lot of American citizens think that people, victims of foreclosures do. We haven't been on vacation in 25 years. We don't go to the movies. Our house is our priority.
(END VIDEO CLIP)
ROBERTS: So this sort of falls out of what Kiran was saying, people who have no income have one problem. What about the unemployed? They have another problem.
ELAM: Right.
ROBERTS: What kind of help is there for them in this bill?
ELAM: And taking a look at it right now, I think it's going to be a difficult situation for Ms. Lewis going forward. They're saying that they would like to cut the mortgage payments to being 31 percent of their gross income.
Well, if you don't have any income what do you do? And so this is going to be special cases they're going to have to go through and look at and see if there's anything that they can do to help them. But basically what the Obama administration plan said is we want to help people stay in their homes and afford payments that they can actually pay moving forward. If you can't make a payment, then it's a difficult situation.
ROBERTS: All right. Stephanie, thanks.
Again, we'll be following this throughout the morning, give you details on it and tell you how you could potentially benefit from all of this. And as we said, it's fairly complicated so we'll try to lay it all out for you. Stick with us.
CHETRY: All right. Well, again, we're going to continue to break down the president's mortgage plan, how it could impact you. Still to come this morning, even if you're not in mortgage trouble, what this plan could mean for your neighborhood and your property values.
Also, modifying an existing loan, how easy is it to do that and are banks likely to streamline the process or give you a hassle?
Also a reminder, Ali Velshi and Gerri Willis will be along this morning as well. If you have a question for them, send it in. Head to our show page, CNN.com/am.
It's nine minutes after the hour.
ROBERTS: Senator on the hot seat again. Just when you thought it was over.
(BEGIN VIDEO CLIP)
SEN. ROLAND BURRIS (D), ILLINOIS: I did not give one single dollar to the governor.
(END VIDEO CLIP)
ROBERTS: But the questions keep on coming. What really went on between Roland Burris and impeached Illinois governor, Rod Blagojevich? Ahead on the Most News in the Morning.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP, "THE TONIGHT SHOW WITH JAY LENO")
JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": Republicans are now calling for the new Illinois senator, Roland Burris, to resign after he apparently lied to investigators about talking to Rod Blagojevich's brother about campaign money. Rod Blagojevich has a brother? How bad is his hair? Geez!
(END VIDEO CLIP)
CHETRY: Welcome back to the Most News in the Morning. Jay Leno with his take on the new political scandal that's brewing in Illinois. They, I'm sure, don't find this funny. These days the embattled senator is sounding a lot like impeached governor, Rod Blagojevich, who picked him to fill President Obama's Senate seat.
Burris is defending himself against allegations that he'd been less than truthful about his appointment to the Senate. Now he faces an ethics investigation and possible perjury charge, as well as growing calls for his resignation.
CNN's Susan Roesgen is following this story.
ROESGEN: John and Kiran, the controversy still is about whether or not Senator Roland Burris gave any money to former Governor Rod Blagojevich in exchange for his Senate appointment, but with every new detail comes new questions.
(BEGIN VIDEOTAPE)
BURRIS: I am the real Roland. If I had done the things I've been accused of, I would be too embarrassed to stand up here in front of you, because you all are my friends.
ROESGEN (voice-over): Senator Burris defended his reputation and his political life.
UNIDENTIFIED MALE: Come on, back up.
UNIDENTIFIED MALE: Hold on, you guys, you got to keep moving.
ROESGEN: Senator Burris blames the media for the controversy over what he did and who he talked to before his Senate appointment, but his own changing story fuels the fire. First, he said he didn't talk to anyone in the governor's inner circle about his appointment. Then he said he remembered that he did get three calls from the governor's brother, asking for money before he was appointed. Now, he admits that he offered to raise money for the governor but says no cash came out of it.
BURRIS: I did not give one single dollar to the governor.
ROESGEN: Still, with each new revelation, critics are demanding a full answer to this one specific question.
PAUL GREEN, PROGRAM DIRECTOR, CITY CLUB OF CHICAGO: Was it wrong of to you solicit funds for Rod Blagojevich at the same time he was considering you for the Senate?
BURRIS: As I said in my statement, we would not make any responses to those type of questions. I said it in my statement and we're not making any responses to that question.
(END VIDEOTAPE)
ROESGEN: You know, I could actually hear some booing and hissing in that audience of Chicago business people while Senator Burris was refusing to answer that question. It was the last question of the day.
But you know, John and Kiran, sooner or later he's going to have to answer that question because other members of Congress, the Senate Ethics Committee, and the White House are all now demanding a full explanation.
CHETRY: Susan Roesgen for us this morning, thanks.
So what is next for Senator Burris? Well, we have more now in an "AM Extra."
Burris faces challenges on two fronts. Back in Illinois, lawmakers want prosecutors to look into perjury charges while in Washington the Senate Ethics Committee has already launched its own inquiry. The Senate does have the ability to expel Burris, but it's not easy to take the two-thirds majority to expel any sitting senator. The last time it happened, 1862. That's when three senators were kicked out for supporting the confederate rebellion.
And stick around, coming up a bit later in the hour at 6:50 Eastern, we're going to be talking with "Chicago Tribune" political reporter Richard Pearson. He's going to be speaking to us about the Roland Burris controversy.
ROBERTS: Senator Dick Durbin now saying that the Senate seat is in question. Might be in some trouble.
Well, take off to the great white north, Mr. President. His first foreign diplomatic trip as president takes him just across the border to Canada. It's a beauty way to go. We're live at the White House with details straight ahead.
And here's a history lesson that nearly 200 students won't soon forget. First Lady Michelle Obama opening up the White House for her young guests. Hear what she told them.
Sixteen minutes after the hour.
(COMMERCIAL BREAK)
ROBERTS: Nineteen minutes after the hour and time to fast forward to some of the stories you'll be hearing about on CNN later on today.
Investors are hoping for a rebound on Wall Street this morning. Stocks begin trading. The trading day near three-month lows. We're going to get reports on wholesale prices and job claims ahead of the opening bell.
The weekly jobless claim numbers come out at 8:30 this morning. They're expected to show some improvement. Economists predict that the number of workers filing for unemployment benefits for the first time may have dipped by about 8,000.
And President Obama goes north of the border for his first foreign trip since taking office. He's going to meet with Canada's prime minister and other leaders to talk trade, energy and the environment.
Let's head to Washington for more on this. Suzanne Malveaux is the only reporter live at the White House this early this morning.
Suzanne, what's the president's focus going to be on this trip? A lot to talk about with our neighbor to the north.
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Absolutely, John. And, of course, issue number one is the economy, the crippling recession really making an impact on economies on both sides of the border. And one of the things that they're going to be talking about is the GM and Chrysler, the three big automakers out of Detroit. Obviously, they're trying to make sure that they're viable.
GM and Chrysler have plants also in Ontario, and they have to prove that they can lower their costs to the Canadian government so they can get about $3 billion from the Canadian government.
One of the things that Stephen Harper, the prime minister of Canada, is also going to be looking at is that $787 billion economic stimulus package. Well, what is in that package?
There is a clause, a phrase called "buy American" and that requires some of those projects to actually purchase U.S. steel. That is something that Harper is concerned about.
We heard President Obama also talk about, look, he does not want to promote protectionism. He doesn't want to start a trade war with Canada, so that is something that they're both going to be discussing.
And speaking of trade, NAFTA, of course, is a big issue with these two leaders. You may recall in Ohio on the campaign, it was camp Senator Obama as well as Senator Hillary Clinton when they were neck and neck, both of them saying that NAFTA needed to be changed, renegotiated.
That is something that the leaders are going to talk about, because a lot of people in Ohio, other states believe that NAFTA caused -- at least caused some U.S. jobs and that perhaps it's not the best deal for U.S. workers. All of that, John, on the table, not to mention talking about the environment, as well as troops in Afghanistan. All of that just a seven-hour trip or so. Just a day trip, John.
ROBERTS: Yes. Just kind of a there and back sort of thing. He'll be leaving at 9:00 this morning, so we'll be following his departure from the White House.
In other news, though, Suzanne, last night we got an indication that maybe they are zeroing in on somebody to replace Tom Daschle as the secretary designee for health and human services. What are hearing about?
MALVEAUX: We're learning that Kathleen Sebelius, the governor of Kansas, is a top contender. We have been told by several officials at the White House that the president has not made a final decision, so this is not something that is necessarily official at this time but certainly in the running.
This is somebody, John, who we saw very early on in the campaign, who came out supporting Obama as a candidate. She was also the insurance commissioner in her state. Very much respected across the aisle. She is somebody that they are looking at very closely. Obviously, this is a very important job for the administration. They are eager to replace what used to be Tom Daschle's position as the nominee, but we don't expect an announcement this week but perhaps fairly soon -- John.
ROBERTS: All right. Suzanne Malveaux for us at the White House this morning. Suzanne, thanks so much.
It's now coming up on 23 minutes after the hour. So Obama maybe getting a new health and human services secretary, and certainly he needs one if he hopes to institute any kind of health care.
CHETRY: Yes. Absolutely.
All right. Well, you know it's Black History Month, of course. And in honor of it, First Lady Michelle Obama hosted a group of mostly sixth and seventh graders. They were from a local Washington, D.C., school, and they were at the White House yesterday. There was actually music and then a brief history lesson from the first lady.
(BEGIN VIDEO CLIP)
MICHELLE OBAMA, FIRST LADY OF THE UNITED STATES: We were all very much kids like you guys. We just figured out that one day that our fate was in our own hands. In the 1960s, did you know that Dr. Martin Luther King and other civil rights leaders met here with Presidents Kennedy and Johnson to debate and discuss the end of segregation? Did you know that?
AUDIENCE: Yes.
OBAMA: Pretty cool, huh? Yes. Well you're yawning. Wake up! I'm just kidding.
And of course, who lives here now? President Obama, and he's making history every single day, why? Why?
AUDIENCE: The first African-American president.
OBAMA: He is the --
That's correct. Would you like to stand? You want to say that one more time?
UNIDENTIFIED FEMALE: The first African-American president of the United States of America.
OBAMA: Very good. Very good.
(APPLAUSE)
(END VIDEO CLIP)
CHETRY: The first lady finished her speech by telling the children that the next chapter in history, of course, will be written by them. She was also impressed because she said they did know a lot about the history of the White House, that it was built by slaves, and they knew other elements of history and African-American history.
ROBERTS: What a thrill for those kids, too, to go into the White House and meet with the first lady.
CHETRY: Yes. ROBERTS: It's great and it really does show that they're, you know, trying to stay active in the community. This will be a fairly open White House.
CHETRY: That will be an unforgettable experience for those kids.
ROBERTS: Absolutely. It's great to see.
President Obama laying out an aggressive plan to keep people in their homes, but is it going to work? And who wins in this plan? We've got the information that you need to know?
And a new twist in the story of the California octuplet mom who is now a mother of 14. Why she could be looking for a new place to live.
It's coming up now on 25 minutes after the hour.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
ALINA CHO, CNN CORRESPONDENT (voice-over): It happens just about every fashion season. A catwalk tumble. Go to YouTube and you'll find the best of the trip up. So what's a model to do? I wanted to find out for myself, so I signed up for high-heel boot camp.
UNIDENTIFIED FEMALE: One, two, three.
(END VIDEO CLIP)
ROBERTS: And believe me, Alina's got some heels, too. Welcome back to the Most News in the Morning.
A glimpse of a story that you won't want to miss. Our Alina Cho goes to model boot camp to master the catwalk. She gets some help from none other than Heidi Klum to learn how to do it. Stick around because Alina's piece is coming up in about seven minutes time.
Right now it's 28 minutes after the hour, and checking our top stories.
Secretary of State Hillary Clinton is on her way to South Korea. Her visit comes amid indications that North Korea may be preparing to test-fire a long-range missile. And just hours ago, Pyongyang said it was ready for an all-out confrontation with South Korea, accusing the country's president of inciting hostility.
The Iraqi journalist who threw his shoes at former President Bush is making his first court appearance since he was arrested two months ago. Muntadar al-Zeidi was greeted by supporters, applauding and cheering his name. Al-Zeidi told the judge he was protesting against the U.S. occupation of Iraq. His trial has been delayed until March while the court tries to clarify whether Mr. Bush's visit was official or not. And the California mother of octuplets who now has 14 kids is in danger of losing her home. Thirty-three-year-old Nadya Suleman and her growing brood live in her mother's home. Reports say that the grandmother, Angela Suleman, is more than $23,000 behind in mortgage payments and the house could be sold at auction in May.
Everybody's being foreclosed on, Kiran.
CHETRY: That's -- what do you do? Where do those 14 kids go? Unbelievable.
All right. Well, yes, and hopefully there's going to be some help out there for homeowners.
President Obama unveiling his plan, says it's intended to rescue nine million Americans at risk of losing their home. And here's how he wants to do it. We're trying to break down this plan today so you can understand it better, see if it could help you or even your neighbor.
So current homeowners who need to refinance, it would give lenders incentive to help homeowners who are still making their payments but are at risk of foreclosure. Also putting billions more behind mortgage giants Fannie Mae and Freddie Mac to ensure available credit. So how will all of this work?
Well, joining us now to talk a little bit about it is Richard Bitner. He's the associate publisher of housingwire.com. He also is the author of "Confessions of a Subprime Lender," spent 15 years in the lending industry and this morning he joins us from Tampa, Florida.
Richard, good to see you.
RICHARD BITNER, AUTHOR, "CONFESSIONS OF A SUBPRIME LENDER": Good to see you.
CHETRY: I trust you got the chance to look over some of this as well, and we sort of wanted to break it down as easy as we could for people that fall into these different categories. One, these are people who are currently making their payments as hard as it is for them to do. They're trying to refinance but they can't refinance because they're "underwater," meaning they owe more than their home is worth. They don't have that 20 percent equity that lenders are looking for right now in order to refinance. So how would this help them?
BITNER: Well, certainly, as you mentioned it's going to be able to do just that. It's going to give people that opportunity who weren't able to refinance the ability to do so.
I think this is one of the parts of the bill, Kiran, that I do have some issues with. I mean, this isn't certainly the first time we've had parts of the market or in this case the entire sections of the market where we had people who had the inability to refinance. Southern California in the early '90s, when we had some significant downfalls and equity at that point. And others were borrows have been in the similar situation. I'm not sure this is particularly a great use of tax dollars when you're starting to try to help people who currently aren't in a troubled situation.
CHETRY: All right. Well, then they could just as quickly I think this is the point that the Obama administration is trying to make slip into this next category, which is people who are either in default now or almost there in default, and what this would be is that they would have to qualify for a loan modifications, to restructure the terms of their loans.
The part that we thought was interesting, though, is if you -- this is -- if you are under water by more than 5 percent or you have a jumbo mortgage you don't qualify.
Why?
BITNER: Well, several reasons. One obviously is that we're doing all of this under the auspices of loans that can be done by Fannie Mae and Freddie Mac. And what we're talking about are, you know, when you do loans with Fannie and Freddie, you're dealing with conforming loan limits, which is typically in the low $400,000 range. So, that's one of the reasons why we've eliminated jumbo mortgages.
You know, I think however and, you know, what's kind of interesting in the timing with this bill is that we happen to be talking from IM from Tampa, which is the home this year for the national mortgage servicing conference. So it's been kind of interesting as this plan rolled out yesterday to get some feedback from my fellow cohorts in the industry.
CHETRY: Right.
BITNER: And I think there's a lot of applause on one level, and that is the government is finally recognized that servicers need to be compensated not because there hasn't been a desire to get involved and do modifications, it's just that servicing is a very low margin business. I mean, it is for all intents and purposes, and again, with all due respect to my fellow compatriots out there, it's a payment and remittance kind of a process. It's sticking a lot of loans through a system. It's not really built to try to do that high-touch refinance process, which is really what happens.
CHETRY: So they're going to make it more worth their while by helping pay for some of that. The government is going to be helping pay lenders?
BITNER: Exactly, exactly, to take some of that cost. And, you know, what's interesting is I read through this bill. There's a couple of things that stick in mind, and one of them is that thousand- dollar figure. That's the up front figure that servicers will be able to be compensated for when they do a loan modification.
The other figure -- and this is the one I got to tell you, Kiran. It really has me scratching my head is that for borrowers who are in trouble, who go through a loan modification, who make their payments on an annualized basis, they have the ability to do -- essentially get a thousand-dollar contribution from the government. And when you stop and think about that for a second, you go, wait a minute, look, I'm a huge fan of the Obama administration. But what we're basically talking about Mr. and Mrs. Taxpayer, you're having your cup of coffee this morning, we're talking about essentially your neighbor being compensated $1,000 for making his mortgage payment.
CHETRY: Which is the exact thing you're doing yourself and struggling and scraping by, but not getting an incentive for.
BITNER: It doesn't make any sense.
CHETRY: OK.
BITNER: Why are we using our tax dollars (INAUDIBLE).
CHETRY: And one other thing before we go, I just have to ask you about this. How will they figure this out? They're going to try to help people through debt counseling, manage their monthly payments, reducing them to 31 percent of their gross income. Who's going to be overseeing that, and how will that exactly work? How do you prove income? And it seems like a real sticky situation to try to figure out.
BITNER: Well, it is and, you know, it's a great question. And to be honest with you, I wish I had a definitive answer. I mean, certainly one of the things we're not going to see are the return of the days of the stated income or the wire loans. You know, who is going to oversee it? That's one of the things that we don't have any details around right now. I think we're going to have to see how that emerges over time.
CHETRY: All right. Richard Bitner, thanks for joining us this morning.
BITNER: Thanks, Kiran.
CHETRY: We appreciate it. It's 33 minutes after the hour.
ROBERTS: How to walk. Think you already know? Well, they thought so, too.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Boom, boom, boom. The key in walking great is always like making big steps.
CHO: Big strides.
(END VIDEO CLIP)
ROBERTS: Boot camp for models, where the heels can be hell.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: One, two, three, four. Concentrate.
CHO: OK, I'm concentrating.
UNIDENTIFIED FEMALE: Concentrate. No, it's easy to be a model.
(END VIDEO CLIP)
ROBERTS: Ahead on the Most News in the Morning.
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ROBERTS: Welcome back to the Most News in the Morning. The life of a fashion model, the expensive clothes, the nonstop parties, the international trips and tripping in more ways than one, too. Sometimes it just even go on the catwalk. It's definitely one of the most glamorous jobs in the world, but there is an element of danger every time a model steps out on the runway. Alina Cho attended sort of a boot camp for the catwalk, and she is here now with more.
We've all seen the slips, haven't we?
CHO: We have. Every season it happens, John. Good morning. Good morning, everybody. You know, models make it look so easy. But walking on the catwalk is no easy feat. Earlier this week, I got a lesson from one of the prettiest and toughest modeling boot camp instructors out there. I even got a couple of tips from supermodel Heidi Klum. What I learn from all of this, modeling isn't for mortals.
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CHO (voice-over): It happens just about every fashion season. A catwalk tumble. Go to YouTube and you'll find the best of the trip- ups. Even super model Heidi Klum isn't immune.
HEIDI KLUM, EXECUTIVE PRODUCER, "PROJECT RUNWAY": In a dress that under my shoe, so I stepped on the dress and I couldn't go any further.
CHO: Klum took a fall while making this Diet Coke ad. So what's a model to do?
KLUM: Boom, boom, boom. The key in walking great is always like making big steps.
CHO: Big strides.
I wanted to find out for myself so I signed up for a high heel boot camp.
ANASTASSIA KHOZISSOVA, MODEL: One, two, three, four.
CHO: My instructor, Anastassia, a veteran catwalker. This Ralph Lauren muse even has a how-to video on modelenia.com.
KHOZISSOVA: One, two, three, four.
CHO: We met up at Milk Studios in New York for a one-on-one lesson.
KHOZISSOVA: Concentrate.
CHO: OK, I'm concentrating.
KHOZISSOVA: Concentrate.
CHO: Lesson one, balance.
KHOZISSOVA: And you're straight here, and you keep straight, shoulders straight. This is it. Head up.
CHO: Once that's down, we get to the walking.
KHOZISSOVA: Your movement always comes from the hips.
CHO: Easier said than done. I've never been afraid of a high heel so I thought boot camp would be a breeze.
It's hard.
KHOZISSOVA: Well, fashion is hard. Everything -- it's not easy to be a model.
CHO: Anastassia's explanation for why models fall? Too much heel-toe on slippery runways.
KHOZISSOVA: I go like this.
CHO: Yes.
KHOZISSOVA: Right?
CHO: Right.
KHOZISSOVA: And I'm falling.
CHO: So what's the key?
KHOZISSOVA: If you want to be great model, professional model, it's a job.
CHO: And like any other job...
KHOZISSOVA: Of course.
CHO: Practice makes perfect.
KHOZISSOVA: Practice, practice makes perfect.
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CHO: Well, Anastassia told me that I still need a couple more sessions. You know, when you're at a fashion show, you watch these models and it looks effortless. But it is far from easy. I wish we could have seen the rest of that piece. Hopefully, we'll get to it later.
You know, I'm not a stranger to high heels, either, John likes to say I walk on stilts. But what I want to know is Kiran with the shortened version of the piece, what did you learn?
CHETRY: Not much. What I did was, I put on my highest heels, Piddy is here for support. This is our stage manager. He literally helps Alina as we teeter around the set all the time. So let's go, Piddy, what did we learn? Big strides.
CHO: Big strides. Heidi Klum says big --
CHETRY: Put one leg -- one foot to the other.
CHO: That's right.
CHETRY: And what --
CHO: Hopefully, on you toes.
CHETRY: OK, stay on your toes.
CHO: And the attitude part you got down, girl. That part you got down. That's number one they say.
CHETRY: That's our problem.
CHO: That's my problem at least.
CHETRY: It's so easy.
CHO: They do make it look, easy. But there's a lot to remember, you know. And remember you get to the end of the catwalk and it's pose for the photographers.
CHETRY: You know, I love it.
CHO: International presence there.
CHETRY: I got to tell our viewers one little secret. The funniest thing about this is we call this long strip --
CHO: The catwalk.
CHETRY: Where we feature a lot of the video in the wall. We call this the catwalk.
CHO: That's right.
CHETRY: And believe me, we've had our share of tumbles here as well.
CHO: Yes, we have. It's a slippery surface. You know, you got to watch yourself.
CHETRY: They deserve all that money. It's not easy being that beautiful.
CHO: But you know what, you got to suffer through with the high heels.
CHETRY: Thanks, Alina.
CHO: You bet.
CHETRY: John?
ROBERTS: Right now, we're watching extreme weather. Damaging tornadoes roar across the South, and this morning that threat is not over. In a moment we're going to go live to the CNN weather center to tell you all about it. It's 41 minutes now after the hour.
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CHETRY: Welcome back to the Most News in the Morning. That's a live look right now at Manchester, New Hampshire. Thanks to our friends in WMUR. It's 33 degrees there right now. We could see some snow or some rain showers later today going up to a high of 39. And we're also watching extreme weather in the southeast this morning. Some incredible pictures.
This is a funnel cloud forming just outside of Macon, Georgia. Tornadoes were reported in several spots across the state, damaging homes, causing a few minor injuries. Meantime, north -- further north in Atlanta, an ominous scene, dark clouds coloring the skyline, just amazing pictures coming from Atlanta.
Rob Marciano is there. He's at the CNN weather center in Atlanta this morning. And when you look at that sky, doesn't look pretty. What ended up happening? Any actual touchdowns of tornadoes.
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CHETRY: You and Alina are old buddies. What did you think of our catwalk attempts? Pretty bad, right?
ROB MARCIANO, AMS METEOROLOGIST: I think you two look and did fabulous.
CHETRY: We're not getting any calls from Mark Jacobs or anything. So we're not worried about it.
MARCIANO: Four days, and see he's not calling. OK.
CHETRY: Thanks, Rob.
MARCIANO: All right. See you, guys.
ROBERTS: Well, this morning, the Obama administration is pushing ahead with its new strategy for the war in Afghanistan. And as President Obama prepares to send 17,000 more troops to the war zone, the general in charge of the campaign is warning Americans of bloody and difficult days ahead. Here's CNN's Chris Lawrence with what we can expect.
CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: John, Kiran, the U.S. commander in Afghanistan says the fight may be longer and tougher than a lot of Americans realize.
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LAWRENCE (voice-over): After a year of relative calm in Iraq, are the American people ready for Afghanistan?
GEN. DAVID MCKIERNAN, COMMANDER, U.S. FORCES AFGHANISTAN: The 2009 is going to be a tough year.
LAWRENCE: The top U.S. commander predicts bloody days ahead.
MCKIERNAN: I would expect to see a temporary time where the level of violence might go up.
LAWRENCE: More American troops were killed in Afghanistan last year than any other time in the war. Now 8,000 more marines will arrive in late spring, 4,000 army soldiers by summer and 5,000 support troops will follow them. And they're heading south to fight the Taliban, where General David McKiernan concedes the fight is still needed.
MCKIERNAN: That's going to bring with it at least for a period of time an increased level of violence.
LAWRENCE: The second part of the mission, mentor the Afghan army. Iraq is smaller than Afghanistan and less populated, but its army is four times the size of Afghanistan's.
JOHN NAGL, PRES. CTR. FOR A NEW AMERICAN SECURITY: The real critical error we've made over the past seven years is that we haven't built post nation security forces, an Afghan army, an Afghan police who are able to secure their country themselves.
LAWRENCE: By next year, the U.S. commander still wants to add another brigade dedicated to training Afghans and possibly another combat brigade. McKiernan says he plans a sustained campaign, not a temporary surge.
MCKIERNAN: For the next three to four years, I think we're going to need to stay heavily committed and in a sustained manner in Afghanistan.
LAWRENCE: These moves come well before the Obama administration is expected to finish its review of Afghanistan strategy. A former congressman and anti-war activists says the president should have waited, not throw more troops at a problem that has no defined solution.
TOM ANDREWS, NATIONAL DIRECTOR WIN WITHOUT WAR: First principle when you find yourself in a hole is to stop digging.
(END VIDEOTAPE) LAWRENCE: The military says the need for more troops was urgent, and Democratic and Republican senators like Russ Feingold and John McCain supported the increase, but questioned the lack of new strategy that came with it -- John? Kiran?
ROBERTS: Chris Lawrence for us this morning from the Pentagon. Chris, thanks so much.
And coming up in our next hour, we're going to speak with former Republican Senator Chuck Hagel. You'll remember he was a vocal critic of former President Bush's war in Iraq. So what does he think about Obama strategy for Afghanistan? We'll find out.
Our left-handed president signing the stimulus bill with a certain style.
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UNIDENTIFIED MALE: I don't care if he writes with his foot.
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ROBERTS: But there are things you don't know about lefties.
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OBAMA: I've got to use 10 pens.
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ROBERTS: Jeanne Moos with a lefty expert.
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UNIDENTIFIED MALE: They are also overrepresented among criminals and among mentally retarded.
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ROBERTS: You're watching the Most News in the Morning.
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ROBERTS: Welcome back to the Most News in the Morning. It's not because he is a Democrat. Lefties love President Obama because, well, he's a lefty. Watch him sign the stimulus bill this week. It drew attention to his signature southpaw style, and our Jeanne Moos has got more on that for us this morning.
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JEANNE MOOS, CNN NATIONAL NEWS CORRESPONDENT (voice-over): It's not just what he signs, but how he signs it.
UNIDENTIFIED MALE: That contorted whatever.
UNIDENTIFIED MALE: He's got the curve, hand over.
MOOS (on camera): He goes like this.
UNIDENTIFIED MALE: And he really curls.
MOOS (voice-over): And if it curls your toes, well, you're obviously not a lefty. Lefties for Obama love having one of their own in the White House. But President Obama's signature style is a bit more hooked than that of most lefties.
UNIDENTIFIED FEMALE: He never learned how to hold his pen and he looks like Joe Cocker.
MOOS: But lefties have an explanation.
UNIDENTIFIED MALE: I think it's because he doesn't want to smudge the ink, because when -- if you go like that, then you're not going to run over your signature.
DR. SAMUAL WANG, NEUROSCIENCE PROFESSOR, PRINCETON UNIVERSITY: It would be kind of embarrassing to find a nearly $800 billion stimulus bill and then smear the ink.
MOOS: Neuroscience professor and author, Sam Wang, says righties only use one side of their brain to process language. But lefties...
WANG: One in seven lefties showed activity in both sides of the brain.
MOOS: Six of the past 12 presidents have been lefties, including presidents Clinton and George Bush Sr.
But before you lefties start gloating about having higher SAT scores...
WANG: They are also overrepresented among criminals and among the mentally retarded.
MOOS: His FBI profile says Osama bin Laden is a lefty. Maybe you're left wondering -- how many pens does it take to sign a bill?
OBAMA: I've got to use 10 pens.
MOOS: The president often signs his signature in bits so he can use more pens, which he then hands out as souvenirs.
UNIDENTIFIED MALE: I want the guy to be a success. I don't care if he writes with his foot.
MOOS: But lefties worried about a twist in the president's wrist have some advice for him.
UNIDENTIFIED FEMALE: Turn the paper. Turn the paper, not your wrist.
MOOS: These days... (on camera): Which hand do you use? OK. Now let's see...
MOOS (voice-over): Lefties like Eve don't get much flack from teachers. Forty or 50 years ago...
UNIDENTIFIED MALE: They had me bring in a tie of my father's. And I used to have to sit in school with my left hand tied to my leg.
MOOS: Now that sounds like the kind of torture a lefty president should outlaw by signing a bill.
OBAMA: There you go.
(APPLAUSE)
MOOS: Jeanne Moos, CNN, New York.
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CHETRY: Backlash over the attorney general's name-calling.
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UNIDENTIFIED MALE: The nation of cowards.
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CHETRY: Nation of cowards in the home of the brave?
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ROLAND MARTIN, CNN POLITICAL ANALYST: It was certainly provocative. It got folks' attention.
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CHETRY: Plus, pushing marriage with your money.
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UNIDENTIFIED FEMALE: That's not really the federal government's business.
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CHETRY: Spending millions of your tax dollars to get people to marry.
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UNIDENTIFIED FEMALE: I would laugh if I saw an ad that said, "Americans should be getting married."
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CHETRY: Uncle Sam, marriage broker? You're watching the Most News in the Morning.
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ROBERTS: Welcome back to the Most News in the Morning. The scandal surrounding Illinois Senator Roland Burris bordering on bizarre now. The senator himself keeps changing his story, and as the allegations keep coming, he remains defiant against increasing calls for his resignation.
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BURRIS: I ask you today to stop the rush to judgment. You know the real Roland. I've done nothing wrong and I have absolutely nothing to hide.
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ROBERTS: Well, now, Burris faces a Senate investigation and possible perjury charges in Illinois. Joining me now, "Chicago Tribune" political reporter Rick Pearson. He knows the real Roland Burris. He's covered him for 30 years.
Richard, great to see you this morning. So we've got Congressman Phil Hare calling for his resignation. Senator Dick Durbin saying he's troubled by the whole thing. That the Senate seat is in question. How much pressure is there out there for Burris to resign?
RICHARD PEARSON, POLITICAL REPORTER, "CHICAGO TRIBUNE": I think there's a great deal of pressure and it seems to be building by the moment. Not only in Washington, but also in Springfield, Illinois. We were finding a lot of Democrats who watched that testimony that Burris gave in the House impeachment proceedings against Rod Blagojevich and are now kind of shaking their heads wondering what is the real story.
ROBERTS: You know, what we saw there he was talking at the city club, a question and answer session. You were there. He was asked by one person if it was appropriate that he was trying to -- you know, looking into raising money for Rod Blagojevich at the same time than he was being considered to replace Senator Obama in that Senate seat. He said, "I was never considered for the Senate," and then he said he wouldn't answer those types of questions. What the heck?
PEARSON: Well, he's trying to parse things to say that there's a difference between seeking the Senate seat and the process of being appointed to the Senate seat. And that everybody should know the difference, when it's very hard for many of us and many of the public to see any difference in him talking to Blagojevich allies, making sure his name is out there, and that he's interested in that seat.
ROBERTS: Well, as they said you were there at the city club when he said that. What was your reaction?
PEARSON: Well, I think there were any number of people, we all kind of went, what? What do you mean? What are you talking about? Because he had even testified in these various stories that he had been talking since the summer to people, finally admitting that he had been talking to Blagojevich allies in the summer, even to the governor's brother about fund-raising activities and an interest in the Senate seat in October and November.
ROBERTS: So you've covered this guy for 30 years as we said. Is this unusual? Is this typical Roland Burris? What is it?
PEARSON: Well, I think it's the fact that, you know, Roland Burris was a three-term state comptroller and a one-term attorney general. He's not used to this kind of scrutiny that comes with the U.S. Senate seat. He wanted this U.S. Senate seat. I don't think he realized, you know, how everybody listens to every word when you're talking about the United States Senate.
ROBERTS: "Chicago Tribune" in its Web site posted a commentary in which it say, quote, "The benefit of the doubt has already been stretched thin" regarding Roland Burris "and finally snapped like a rubber band, popping him on that long Pinocchio nose of his. There's only one honorable action for Burris, "resign."
Pretty tough words from your publication.
PEARSON: Well, the Tribune has called for his resignation. The Springfield "State Journal-Register" has called for his resignation. Phil, here, the first member of the Democrats in the Illinois congressional delegation calling for it.
Dick Durbin yesterday calling from Turkey, where he's on a state visit. You know, he's saying that Burris's testimony before the Illinois House impeachment, which was a condition for being seated in the United States Senate, he did not pass the bar of giving full and truthful testimony.
ROBERTS: Yes. The White House saying something similar along those lines as well. Well, we'll see what happens. We'll keep following the story.
Richard Pearson from the "Chicago Tribune," good to see you this morning. Thanks for joining us.
PEARSON: Thanks, John.
