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CNN LARRY KING LIVE

Sen. John McCain Discusses President Obama's Economic Plan; Reaaction From Mayors, Economists

Aired February 24, 2009 - 23:59   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: It's a concern that rises above all others.

LARRY KING, CNN HOST (voice-over): At stake, the president's reputation, America's future, and your financial security.

OBAMA: It's not about helping them, it's about helping people.

KING: Senator John McCain was there, watching it all up close. And he's here with his response.

Plus, what do the president's plans mean for you? Our Financial experts are standing by to answer those questions.

Get the calls ready right now on a special late edition of LARRY KING LIVE.

(END VIDEO CLIP)

KING: We begin with a special late edition of LARRY KING LIVE.

And from the Russell Center Office Building, Senator John McCain, Republican of Arizona, he was the, of course, presidential nominee of his party in 2008 and one of the many attending that speech tonight. What's your reaction to it?

SEN. JOHN MCCAIN (R), ARIZONA: I thought that the president gave an excellent speech, Larry. I think he carefully balanced the enormity and the size of the challenges and difficulties that America faces and at the same time, I think he gave Americans assurance and confidence that we could get through this.

We had areas that, obviously, I had questions about and disagreements with. But I think the theme of his speech and his delivery was excellent.

KING: When you can have that kind of ability as an orator, can you sway people? Can you move -- can things change because of that ability?

MCCAIN: I think he did in the campaign. And I think, you know, when I was sitting there at the inauguration, not exactly where I wanted to sit, I looked out on the mall and I saw a million people out there and I saw a real enthusiasm and a real sense of hope for change out there. So I think that the president has been very effective in communicating.

KING: Admittingly, Senator, he inherited this problem. What area of it at all can you support?

MCCAIN: Well, I can certainly support his efforts in healthcare reform and I think we need to sit down in a bipartisan fashion. He left out Social Security reform. I have real questions about the spending particularly since we're about to have a bill that has 9,247 pork barrel projects, earmarked on it before the Senate the day after tomorrow. ( But -- and also I'd like to see nuclear power and any energy equation. But I do agree with the president, healthcare is a compelling issue. We have to sit down, fix Medicare, fix healthcare, so that all Americans would have the opportunity to obtain healthcare at affordable rates.

KING: Do you feel Social Security was something left out that should have been put in?

MCCAIN: Well, I think it's something, frankly, that's a little easier to address. But I also understand there was some debate within the White House about what should -- is the most important priority. And from the standpoint of its impact on -- for the future of Americans as far as the unfunded liability, on whereas the debt we're laying on future generations, the unfunded liability associated with Medicare is much larger than Social Security.

KING: Senator, Bill Clinton, the former president, recently said on this program that Obama should be more optimistic rather than just saying how bad things are. Do you think he was optimistic tonight?

MCCAIN: I do. I think he was very strong in his words. Telling Americans or reminding Americans we're the greatest nation on earth, that our best days are ahead of us, and that we can get through that. I think he did a very effective job at that.

KING: Did you watch the governor of Louisiana's response?

MCCAIN: Yes, I did. And I'm a great admirer of the governor of Louisiana and I'm proud to be a great American when I see two Americans of the heritage that both of them hold speaking to the American people.

KING: When the president discussed Iraq, the cameras showed you not very happy. What disappointed you about that part of the speech?

MCCAIN: Well, a couple of aspects of it. One is that we're not going to save money, I don't believe, because we're going to have to spend a lot more on Afghanistan. I think we should tell the American people that it's a long, hard struggle in Afghanistan.

Second of all, there's going to be tens of thousands of, quote, "advisers," that will remain in Iraq. Let's be straight with the American people. A lot of the advisers will be in harm's way as well. But we have -- but I understand the president's campaign commitment but I want to make sure that we withdraw in Iraq so that we never have to come back.

KING: Wasn't fighting a war in Iraq while lowering taxes a mistake?

MCCAIN: I think the biggest mistake was overspending, not telling the American people the price of the war, and I applaud the president's statement tonight that any accounting we do to the American people will include the cost of the war in Iraq.

So I think the biggest mistake that we Republicans made -- well, the conduct of the war in Iraq as you know is an abysmal failure for a long period of time. We paid a terrible price for American blood and treasure. But the spending -- spending get completely out of control, Republican Party paid a very heavy penalty for it and, frankly, in some ways, we deserved it.

KING: The president said tonight that the weight of this economic crisis will not determine the nation's destiny and that the United States will emerge stronger than before. You agree?

MCCAIN: He's absolutely right. Those are very important words and I'm sure that they provided some comfort to all Americans, especially those who are in difficulty and need today.

KING: But in the early days, Senator, you have been rather negative, have you not? I mean you certainly have an appeal to bipartisanship.

MCCAIN: I have appealed to bipartisanship when it comes to a stimulus package that we sit down and negotiate together. I've been involved in many, many bipartisan agreements. You sit down and negotiate. This stimulus package began by the Speaker saying we won, we write the bill. That's not the way you act in a bipartisan fashion. That's why I was disappointed.

KING: Doesn't the winner write the story, though?

MCCAIN: The winner and the loser committed to change things in Washington and sit down and work together as much as possible. We may not agree, but by sitting down at the table together and negotiating with one another, the chances are greatly enhanced of an agreement.

That didn't happen in the stimulus package. I think it may happen in healthcare reform, to be honest with you. I think there's a real good chance of it.

KING: We have a few more moments with Senator McCain. When we come back, do Republicans want President Obama to fail or are they the party of no? We'll ask the senator after the break.

And get your money questions ready for experts coming up.

(COMMERCIAL BREAK) (BEGIN VIDEO CLIP)

OBAMA: But I also know that in a time of crisis, we cannot afford to govern out of anger or yield to the politics of the moment. My job, our job, is to solve the problem.

(END VIDEO CLIP)

KING: What do you make of the idea that some say they want the president to fail? Do you echo that?

MCCAIN: No, Larry. We want the president and -- to succeed in leading this country out of the terrible economic challenge, also, by the way, the national security challenge that we face. We want the president to succeed. We want America's greatness to continue into the 21st century.

But we also want our input and we want to work together. I believe there are many lessons of the last election. One of the major ones, America wants a different way of doing business in Washington, D.C. and they're not happy with the way we've done business recently. And I believe that there's still a good chance of us doing it.

KING: Couple other things...

MCCAIN: Sure.

KING: He wants to close Guantanamo, you agree?

MCCAIN: Yes, but you've got to address the entire issue. What do you do with the people you can't send back such as the Uighurs that we can't send back to China? What do you do with people that you can't release otherwise? You know, they'll go back to -- recent cases we've seen where people have committed actual acts of terrorism after they've been there.

And how do you address the cases and what judicial fashion? It's got to be done in a package. They announced that they're going to close Guantanamo, which I would have done, but they didn't make any accommodation as to what we would do with them. And that's going to be much tougher now. We should have announced a package. But I look forward to working with the administration on this issue.

KING: Back to economics, the Fed chairman, Bob Bernanke -- Ben Bernanke, rather, said there's a reasonable prospect the current recession will end in 2009 if the banking system is propped up. Do you agree?

MCCAIN: I do. And, obviously it's the utmost importance that we act effectively, rapidly, and learn the lessons and the mistakes from, quote, "TARP 1," the first bailout were we badly -- was badly mismanaged. I share the president's fundamental belief in the strength of our economy over time and we can overcome it. And -- but nothing is inevitable. And I think we could hasten that recovery by acting effectively and together.

KING: Would you nationalize the banks?

MCCAIN: No, I would not do that. I -- know that we have to rescue failed banks. And that's the FDIC and guarantee depositors and all those things but I wouldn't nationalize the banks.

KING: You, at that rather historical Fiscal Responsibility Summit, you pressed the president on that purchase of the presidential helicopters.

MCCAIN: Yes.

KING: Did you like his response?

MCCAIN: Sure. But we -- I was in a group with the secretary of homeland security, other members of the Armed Services Committee, House, Senate, others. And we had just been talking about that. I was trying to use it as an example of the terrible cost overruns we've had in the acquisition of our weapons systems and our defense spending that has been so wasteful of taxpayers' dollars.

The presidential helicopter, the ships that cost four times the original cost that we have to scrap it. It's out of control. The president said he's committed to procurement reform. I wasn't picking out the helicopter just, you know, specifically. I was trying to use it as an example of the need to reform our procurement system.

KING: That's certainly one of your areas of expertise. How do those things happen? How do we get those ships that are 10 times override?

MCCAIN: Lack of competition, lack of regulation, lack of transparency, lack of oversight on the part of Congress. It's our fault, too. But it's also a situation where we have these cost-plus contracts. In other words, you go out and contract for someone to buy something, they're going to do it for the amount of money you contract.

Defense contracting today is that plus whatever cost they feel that they have to assume for a variety of reasons, some of them valid, some of them invalid. So you automatically are never going to get whatever the product is for the cost you contract for. It's called cost-plus. And it's out of control.

KING: The president intends to nominate the former governor of the state of Washington, Gary Locke, as secretary of commerce. What do you make of that choice?

MCCAIN: I always -- because elections have consequences, I always give the presidents -- the elected presidents the benefit of the doubt. I would assume that he's qualified. But we will go through the vetting process and the process of confirmation and Senate hearings. But I would imagine he's qualified.

KING: Would you say that you're in a conciliatory mood tonight, Senator?

(LAUGHTER)

MCCAIN: Larry, I'm very unhappy about the earmarks that are coming up on the floor of the Senate tomorrow. $2 million for sponsoring astronomy in Hawaii. It's 9,000 pork barrel items that are coming up on the Omnibus Appropriations Bill that's coming to the floor of the Senate. You'll see me fired up again, my friend.

KING: Are you glad you ran?

MCCAIN: Oh, yes. It's a great honor of my life. The greatest thrill to have the nomination of my party and to have the opportunities that I have. I'm -- I'm still the luckiest guy that's ever been on your show.

KING: Thanks, Senator. And maybe the most -- the most times on the show. We look forward to many more times with you.

MCCAIN: Thank you. Thanks for having me on, Larry.

KING: John McCain, senator from Arizona.

So what happens to you and your money now? Will the speech make a difference? Stick around, find out and get your calls and e-mails ready. We'll be right back.

(COMMERCIAL BREAK)

KING: President Obama sounded a note of hope tonight but he acknowledged the financial pain felt by millions.

(BEGIN VIDEO CLIP)

OBAMA: I know that for many Americans watching right now, the state of our economy is a concern that rises above all others. And rightly so. If you haven't been personally affected by this recession, you probably know someone who has -- a friend, a neighbor, a member of your family.

You don't need to hear another list of statistics to know that our economy is in crisis, because you live it every day. It's the worry you wake up with and the source of sleepless nights. It's the job you thought you'd retired from but now have lost, the business you built your dreams upon that's now hanging by a thread. The college acceptance letter your child had to put back in the envelope.

The impact of this recession is real, and it is everywhere. But while our economy may be weakened, and our confidence shaken, though we are living through difficult and uncertain times, tonight I want every American to know this -- we will rebuild. We will recover. And the United States of America will emerge stronger than before.

(END VIDEO CLIP)

KING: What do our experts think of Obama's speech? Their take is next.

(COMMERCIAL BREAK)

KING: An outstanding panel is now assembled. In Washington is Adrian Fenty. He's the mayor of the District of Columbia. Here in Los Angeles, Larry Elder, the libertarian commentator and best-selling author.

In Sacramento, it's Mayor Kevin Johnson, was elected in November, the first African-American to hold that job and a former great star in the NBA. And in Washington, Congresswoman Marsha Blackburn, Republican of Tennessee. She voted against Obama's stimulus package.

Mayor Fenty, how did he do tonight?

MAYOR ADRIAN FENTY, DISTRICT OF COLUMBIA: I think he did fantastic. He showed great leadership, very focused on the issues and then a visionary. Even talking about what we can do to be the best in all things this country should claim to be the best in.

KING: Larry?

LARRY ELDER, LIBERTARIAN COMMENTATOR: Well, it was a great political speech. Bad economics. Certainly historical. I just wish he was a limited government, personal responsibility, hard core fiscal responsibility Republican which, of course, he isn't.

Look, he's got a faith in government that I don't share. Whenever I hear somebody talk about investing in healthcare, investing in education, investing in energy, I put my hand on my wallet and I say these guys are not good stewards of your money the way you are of your own money.

KING: Do private enterprise have anything to do with causing this problem?

ELDER: Yes, a lack of it. We have had too much government involved in the housing business that goes back...

KING: And the Bush administration?

ELDER: Oh sure. That goes back with Freddie and Fannie, and the Community Reinvestment Act, and all sorts of things that have made this problem worse.

KING: Mayor Johnson, what did you think?

MAYOR KEVIN JOHNSON, SACRAMENTO: I thought his task was s straightforward tonight. I mean it was to raise the hopes of America people, lower expectations, instill confidence in people. I thought he hit a homerun. I thought, in many ways, his speech was a bread and butter speech. He talked about healthcare, he talked about energy, he talked about education.

He connected with the American people. I think at the end of the day, when you look back on his presidency, the foundation is really going to be about accountability. He's going to hold Democrats, Republicans, governors, states, mayors, and cities, all accountable for taxpayer dollars.

KING: Congresswoman Blackburn, I know that you would have disagreed probably with a good deal of it. But what did you make of it in context? How well did he deliver it? How well did he handle the message?

REP. MARSHA BLACKBURN (R), TENNESSEE: He did an excellent job of delivering his remarks tonight. He is a wonderful orator. We all know that. And indeed he did a very good job.

I think the things, Larry, that when you look at the content of that speech is that one of the things that does give you pause is basically he announced to the world tonight that the era of big government has returned. And he used lots of different terms applying federal resources, investment, and planning, all which meant we are going to take taxpayer dollars and we're going to put them on to these specific problems.

And he does receive points for saying there are problems and they need to be addressed. We all admit that. But I think there is that difference. And he drew that line in the sand very well tonight, as to whether it's government or private sector.

KING: Mayor Fenty, is government the last resort here?

FENTY: Well, I think, you know, in the front lines, and mayors tend to be on the front lines, you see that these economic hard times are hitting people. And the stimulus package that the president has put through, it's not going to solve any particular gap, but -- completely, but I think it will bridge the gap until cities, states, are able to get their economies going.

Here in D.C., he's going be able to get us $170 million out of a $450 million problem going to the next year. Without that, we would be hard decisions made about teachers or healthcare or police. So I think he's doing the right thing. It's a short term strategy, I think, will pay long-term benefits.

KING: Assuming, Larry, you don't want him to fail, so then you want this plan to work?

ELDER: Well, I want...

KING: Assuming.

ELDER: I want the country to succeed. The country will succeed if government gets off of the backs of people. Ronald Reagan inherited an economy that was in a recession. Soon unemployment was much higher than it is right now, it's 10.8 percent. He didn't have a fiscal bailout package. He had a package to cut taxes.

KING: But he had a deficit.

ELDER: He had a deficit for all sorts of reasons. He also inherited a cold war. But Larry, the treasury secretary under FDR, Morgenthau, in his diaries, wrote, "We have spent and spent and spent. After eight years, we have very little to show for it. We have high unemployment, and we haven't made good on our promises, and we have debt to boot.

So this had been tried and it's failed. As I said, good speech, good politics, bad economics.

KING: But you don't want him to fail? I don't...

ELDER: I would like to defy gravity, but when you spend money and you spend it inefficiently, you're going to get more inefficiency and less productivity.

KING: Kevin...

ELDER: I'd like that no to be case but it is the case.

KING: Mayor Johnson, why do you think it's going to work?

JOHNSON: Look, the brilliancy of the economic stimulus package is simple. President Obama says look, I don't want big government, I want smart government, I want responsive government. This is a situation right now where we have a crisis, unprecedented crisis in our country.

And what his administration is saying to all of us is let's not squander, let's not waste this opportunity. Let's put government to work for people. If we have foreclosure situations, and let's get job where people can refinance and keep their homes. If we have situations where unemployment is very high, then let's make sure that the economic stimulus dollars go to the states and the cities where you can immediately put people to work.

That is the response of government, rather than being inactive, and not having action, I think he's doing a great job of making sure that government is stepping in and filling the gap especially in these unprecedented times.

KING: We're going to let Congresswoman Blackburn respond to that when we come back right after this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: ... of the United States.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: Budget does not attempt to solve every problem or address every issue. It reflects the stark reality of what we've inherited. A trillion dollar deficit, a financial crisis and a costly recession. Given these realities, everyone in this chamber, Democrats and Republicans, will have to sacrifice some worthy priorities for which there are no dollars. And that includes me. (END VIDEO CLIP)

KING: We're back. All right, Congresswoman Blackburn, Mayor Johnson said that it's -- it has to be the answer. What do you think?

BLACKBURN: Larry, I think that what we will find out is that while we all want our count country to be successful and America to move forward, that you have to have more on the tax incentive and the regulatory relief side. Plus, you have to reduce what the federal outlays are going to be. We can look at what the market response has been here before, with pre-TARP, with TARP, with the Obama plan, and the response has not been there in the marketplace.

And we also know you have to incentivize small business to create jobs. That is the growth engine in this nation. And unfortunately, if you're going to at increasing taxes on $250,000 and above, that is a lot of your small business owners. And this is not the time to be increasing tax on those small business owners.

I do have some reservations about this. And we're going to continue to push for tax relief that will indeed spur growth.

KING: Mayor Fenty, are you surprised that Governor Jindal kind of dissed the congressional Republicans.

FENTY: Well, yes, I think people have strong opinions. What I think will happen from here is -- I think people who don't see 100 percent with President Obama will give their comments and he will probably make adjustments. He's shown a willingness to listen to his critics and to make adjustments that I think is refreshing in politics.

But we should remember -- he was elected in what can only be considered a mandate. He talked about making these types of policies once he got elected. So his stimulus package is really the promise that he was elected on. I think for the substance of it and for the fact that he was elected by the people, we should all get behind it. He's our leader. Let's give him our support.

KING: Larry, are you surprised to learn that -- this is a CNN poll -- that only 8 percent of the public that we polled was negative toward the speech tonight?

ELDER: It was a fantastic speech. He's a very good speech- ifier. And following George W. Bush, I think that helps a little bit. But, Larry, the money comes from either taxing or borrowing, which is taxing on lay-away or printing it -- all three are bad.

And you ask yourself three simple questions -- who's going to pay, how much is it going to cost, and will it work? As I said before, it's been tried under much worse circumstances during the Great Depression and the new deal, despite what you're taught in high school, did not succeed as an economic plan.

KING: The country didn't do well after that? ELDER: The country didn't do well. The -- unemployment bounced between 20 percent and 15 percent. Twenty-five percent got as high as that.

KING: Did Obama inherit this problem? He didn't cause it. He's only been in...

ELDER: No, sure, he inherited it. But he also voted for much of the deficit that he inherited. TARP 1, I think we all agree, did not work. Obama was in the Senate. He voted for it.

KING: Do you think, Mayor Johnson, that it can work without all this government involvement?

JOHNSON: It's not going to work without this government involvement, and that's why this plan is so important. What the president is doing is bringing people together. We're talking, again, about energy, we're talking healthcare, we're talking education. We're talking about preserving jobs.

Everything that he's doing has an appearance of transparency and accountability. The taxpayers are going to be able to hold his administration accountable for those dollars are spent. I think that is very significant. No one is hiding or sweeping anything under the rug. And I think it's an excellent opportunity to make sure that we make education well -- as well a top priority in our country.

KING: Congresswoman Blackburn, wouldn't it be wise to give it its best and support it?

BLACKBURN: Well, everyone is going to work hard to make certain that we address the issues that we have before us, the economic issues, the recession, and making certain that we keep our focus on a few simple things. The best economic stimulus is a job. The best way you create those is through lowering your taxes, reducing regulation, getting federal spending under control.

If President Obama wants to come along and reduce the federal budget, and reduce what we are spending and reform government, we are going to be there to work with him every single step of the way. And we're going to continue to put good ideas on the table, which is what we did.

Unfortunately, his outreach to us is not matched by outreach from Speaker Pelosi and Leader Reid. They didn't take any of the ideas that we brought to the table.

KING: One thing for Mayor Fenty, the Senate voted today, Mayor, to take up legislation to give your area, the District of Columbia, a fully vested representative in the House. Do you think this will come to pass? It will also give you a fourth House seat.

FENTY: Yes, this is going to pass the Senate and then the House and be on the desk of President Obama for his signature. The biggest advancement in voting rights for D.C. residents in 200 years and our founders promised that every American would have representation in Congress. So this will be the last chapter fulfilling that promise.

KING: Thank you all very much. Always good seeing you, Larry. Thank you, panel.

Coming up, your money, your jobs, your security. What do the financial experts think Obama will do for you. We'll talk about it and take your calls. Stay with us.

(BEGIN VIDEO CLIP)

OBAMA: No, I do not accept a future where the jobs and industries of tomorrow take root beyond our borders. And I know you don't either. It is time for America to lead again.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: This time CEOs won't be able to use taxpayer money to pad their paychecks or buy fancy drapes or disappear on a private jet. Those days are over.

(END VIDEO CLIP)

KING: Now let's scan the heart of it. Finances. In New York, Jean Chatzky, the personal finance expert, best-selling author. Her next book, by the way, will be titled "The Difference." It comes out next month.

Here in Los Angeles, Larry Winget, the self-proclaimed pitbull of personal development. Best-selling author of "You're Broke Because You Want to Be," and his latest book is "People are Idiots and I Can Prove It."

And in Miami, Don Peebles, chairman, CEO of the People's Corporation, best-selling author of "The Peebles Path to Real Estate Wealth." He's been a fundraiser and economic adviser, by the way, for Barack Obama.

Before we check with Gene, let's start with Larry. Reaction to the speech?

LARRY WINGET, PERSONAL FINANCE EXPERT: I thought he did a great job. I thought it was a wonderful speech and I agreed with everything he says, we need to have done. However, I have a problem with the fact that we're going to do it.

Based on the whole idea that I don't believe you can borrow your way out of debt. I don't think you can spend your way out of debt. If you came to me and said I'm in a financial crisis, I've screwed up everything based on all of my bad decisions, what should I do?

The last thing in the world I would tell you is to go borrow more money or go try to spend something that -- money you don't have on something you don't need.

KING: But this is a government, not a person. So what would you tell the government to do?

WINGET: I would say that the only way to get out of debt is to work your way out of debt. The practical thing would be to put more money in the hands of people, which would always go back we need to give bigger...

KING: All taxes.

WINGET: Bigger tax cuts.

KING: Don, what did you think of the speech and what some -- what are some of your answers?

DON PEEBLES, REAL ESTATE EXPERT: I think that what the president outlined here is a great sense of responsibility and accountability for America. He challenged Americans, he challenged Congress to work with him to restore confidence in our system.

And, of course, confidence is very critical because optimism is contagious and fear is infectious. And what we have right now is fear perpetuating throughout the marketplace. And the president's stimulus package is not spending -- deficit spending per se. It's an investment in America's future. And where else should we invest and where else should our government invest other than investing in America's future?

Now I don't agree with everything that the president's outlined but I agree with the overriding theme here that we have to invest in America. We have to be accountable and responsible for what we've done in the past and now change...

KING: Right.

PEBBLES: ... take a look at ourselves and move forward.

KING: Jean?

JEAN CHATZKY, PERSONAL FINANCE EXPERT: Absolutely right. Jeff's building on what Don said. We have to be accountable ourselves and move forward. The president outlined a message of resilience. He basically said, hey, the resources are out there for you. I am going to put some additional money in your pocket. I am going to work to free up the credit market so that lending can begin once again.

But then, people, everywhere in the world, it is up to you to dig in to your souls and in to your psyches and find the resilience that you're born with. That's the difference between people who will succeed in this next five, ten-year period. The people who find their resilience, who harness their resilience, who channel it and build on it to get them to the next level. Those are going to be the superstars in 2020.

KING: Larry, lower taxes were part of this problem, aren't they? WINGET: They were part of the problem. But I tell you right now, putting $65 back in people's pockets back as of April 1st, $65 a month, that's a joke. I mean that's not enough money to keep somebody in their house, it's not enough to help them make their medical insurance payment. It's not enough money to make any real difference in a regular guy's life.

I'm not a political guy. I'm a regular guy who talks to regular people every single day. And the regular person is afraid. And they look at $65 and they laugh. And they look at some of what's being proposed right now and they're saying it's just more spending, and it's more spending.

I love Barack Obama. I think he's a great guy. And I think he's doing a great job in so many ways but the economy right now and this idea to fix it by spending more money is a bad idea in my opinion.

KING: We're going to ask our guests what, individually, they would tell you do with more tips on the way. So keep questions coming at CNN.com/LarryKing. And you're -- just go to my blog. Comments in 60 seconds.

(COMMERCIAL BREAK)

KING: We've been hearing a lot from you tonight on this special later edition of LARRY KING LIVE. David Theall joins us with your comments from our blog. David?

DAVID THEALL, LARRY KING LIVE BLOG CORRESPONDENT: Larry, we have been talking about the president's speech on the blog and we've been talking about the reaction to it as well. Overall, people think that he did a pretty good job. As a matter of fact, we're seeing a couple of greats.

Some people are saying that they feel the hope that they felt during the campaign and even a couple of nods to president JFK and President Reagan as well in president Obama's delivery tonight.

We pulled a couple of comments we think are pretty representative of what we're hearing. Wanda is one of them. She says, "I didn't hear anything different. I still feel no safer. President Obama has nice speeches but he keeps it very light," says she. "I still don't see how his recovery plan will work."

Taking the middle ground was Peter who says, "He's no President Reagan but he's better than the last few we've had. I don't believe government is the answer, but I like the way this president at least seems excited about finding solutions."

And then we've heard from a lot of people like Nora who says, "Honest, straightforward, and he spoke to the American public, not to the politicians," says she. "I was never interested before but he has encouraged me to stay involved."

We're going to continue the conversation as we always do, CNN.com/LarryKing. Look for that blog link, click it, jump into the conversation. We look forward to hearing from you. Larry?

KING: Thank you, David. Thanks for staying up late. When we come back, our money experts have more advice on how to get through these tough times, next.

(COMMERCIAL BREAK)

KING: Beautiful shot of the Capitol where the president spoke tonight. It's 33 degrees in Washington, clear. It's 10 to 1:00 Eastern Time in the morning on this special edition of LARRY KING LIVE.

Don Pebbles, what would you -- would you say to the average person? What can they take from all this?

PEBBLES: President Obama cannot save us. Americans will save ourselves. We have to save ourselves. We need a leader. The president assumed the leadership role in our country. But it's up to us. And he's challenging us to help ourselves.

The greatness of America is of the people, for the people, by the people. The government is here to help pave the way. But it's us who go out here and create these opportunities. And this is still the world's largest economy.

And by the way, things happen -- recessions happen globally. We're in one now. We've had one in the past. We've had one in 1990s. We've had one in the 1970s. And so we have another recession again. But it will get better. And there are going to be opportunities within this recession for us to prosper.

And we will get better and be better from this experience. But it's up to us and it's up to every American at home to do that.

KING: Jean, what would you say to the average person facing possible foreclosures, various financial problems?

CHATZKY: I would say two things -- first, if you are looking for your next opportunity, if you are looking for your way out of this recession, your personal way out of your recession, President Obama gave you a road map tonight. He outlined where the spending will happen and where you can find that next opportunity. In education, in energy, in health care.

I was raised by a couple of teachers. I love the fact that we are going to be incenting people to get in and teach our kids that they have to graduate high school, that they need to go to college because it's the only way to earn a decent living in this country.

The other thing that raised my eyebrows was that he used the words -- a common sense approach to money. We got in to this trouble because we bought hook, line, and sinker too many stories about things that were too good to possibly be true. Let's get real about the fact that we need to save money...

KING: All right. CHATZKY: ... for our own futures, invest for our own futures, and dig our own way out.

KING: Larry, we have an e-mail question from John in St. Louis. At what point will we know whether or not the stimulus plan is working? What are the signs we should start looking for?

WINGET: Well, I think when we see credit really loosen up and the housing market will be the first indication that people are starting to buy houses again, I think that will be the first indication. Right now, we're not seeing a lot of houses being sold. Not as much as we have in the past. I would look to housing first.

And I want to comment about what Jean said. I think that we did buy to hook, line, and sinker into the fact that things were so good. And my message to the American people would be don't buy hook, line, and sinker into the fact that things are so bad. Don't focus on the economy so much.

Go to the mirror and look at your own personal economy. You cannot control the Dow. You cannot control what the stimulus package is going to do. The only thing you can control is your own level of consumerism. Getting control of your own money and your own finances. Control your economy. That's the mistake that the average person has made in the past.

KING: Are you optimistic?

WINGET: I am optimistic. Yes. I think a lot of good will come out of this. One, people will go to work and do their jobs. Two, we are moving more to a cash society instead of a credit society. And, three, we're actually going to loan people money based on their ability to repay that money. Those are good things.

KING: Let's take a call. New Lexington, Ohio. Hello.

LEXINGTON, OHIO: Yes, Larry, I was wondering how the stimulus bill is going to help students that are currently enrolled in college?

KING: Don, what about students in college?

PEBBLES: Well, what it's going to do, of course, for their parents is to give a tax credit of $2,500 per year for the four years in college. But also what it would do is provide jobs. These infrastructure jobs and these -- this investment back into our country, energy system, back into our country's infrastructure.

And also looking for green jobs and green architecture. I believe those will create jobs for graduating students. And also he's going to be investing significant amounts of money for scholarships, for education, and so -- also student loan program is going to be enhanced, as well, through the stimulus package and that will, of course, help students in college.

CHATZKY: That -- that's right.

KING: By the way, the president's speech will be repeated at the top of the hour.

Jean, you were going to say?

CHATZKY: I was going to say he spoke early in the speech about a new fund to free up lending for things like cars and more importantly student loans and particularly for people right now who are struggling to figure out whether they should go to the public school or the private school that they've been accepted to.

Those student loans are of the utmost importance. And people need to know that the money is going to be there if they're actually going to find their way.

KING: We'll be back with some more moments on the financial side of all of this right after this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: If we come together and lift this nation from the depths of this crisis, if we put our people back to work and restart the engine of our prosperity, if we confront without fear the challenges of our time and summon that enduring spirit of an America that does not quit, then some day, years from now, our children can tell their children that this was the time when we performed in the words that are carved into this very chamber something worthy to be remembered.

Thank you, God bless you, and may God bless the United States of America.

(END VIDEO CLIP)

KING: There's another call. Sterling Heights, Michigan. Hello.

STERLING HEIGHTS, MICHIGAN: Hello.

KING: Hi.

STERLING HEIGHTS, MICHIGAN: Hi, my name is Patrick. I'm calling from Michigan -- Sterling Heights, Michigan.

KING: Yes.

STERLING HEIGHTS, MICHIGAN: My question is toward Dan. The real estate guy?

KING: Yes.

STERLING HEIGHTS, MICHIGAN: I have a -- I used to own a business and I lost my business about six months ago, and now I'm struggling, my home is going into foreclosure. And I need to know what to do.

KING: Don?

PEBBLES: Well, there's -- starting on March 4th, the rules will be announced for the president's Home Stabilization Program. And if you can demonstrate an ability long-term to pay your mortgage, there will be help for you to refinance the mortgage and also hopefully refinance the lower payments for that mortgage.

The stimulus program has specifically targeted that portion of it, the housing plan is specifically targeted for people who have lost their jobs.

KING: West, New York, hello?

WEST, NEW YORK: Hi. My question is, I'm an average American who obtained a mortgage that I can afford, that is within my means and according to my salary. However, recently, I've been hit with a huge tax increase, 27 percent at one time. What can I do to overcome this? Because I got something that I could afford, but it's the taxes that's going to put me overboard.

KING: Larry?

WINGET: Well, that's sad. And that does happen to a lot of people. What you have to do is look at other areas of your life that you can cut back on. You have to adjust your life style. I'm glad that you're a responsible person who bought a house that you can afford and that you can make the payments on.

And taxes are just one of those necessary evils that sometimes you have to sacrifice in other areas to figure out how to pay. There's not a lot you can do about lowering your taxes.

PEBBLES: Actually, Larry, she can.

KING: Jean, there's something...

PEBBLES: Actually, Larry, she can. She can appeal her taxes estimate.

CHATZKY: That's right. She's talking about her property taxes. And I just went through this in my neighborhood six months ago. Got a huge amount of relief. You should contact a lawyer in your area who specializes in this.

(CROSSTALK)

PEBBLES: She can do it herself. I used to chair...

KING: CNN -- something puzzling. CNN Opinion Research Poll shows nearly 8 in 10 Americans say that things are going badly. Yet 3 out of 4 say they're doing OK personally.

Explain that, Jean.

CHATZKY: Maybe they're looking at the people around them suffering and just taking a general temperature of the water but feeling fairly OK themselves. You know, you dive into statistics like this and it's very hard to figure out who's answering which question at which time. But I do think for everybody right now the focus has to be on you and not on everybody else around you, not on the world around you and who's earning what and who's spending what. You take care of earning a decent lending, of spending less than you make, of investing the money that you're not spending so that it can work for you and protecting your financial world and you will be OK in the end.

KING: Larry, do you think an effective speaker like the president, just through that, his effectiveness can effect change?

WINGET: I absolutely do. The one strength that I think he really has is that he inspires people and then he gives them hope. And sometimes hope and inspiration is just as important as a great economic plan. If he inspires people and gives them the courage to work hard, personally, it's very effective.

KING: You agree, Don?

PEBBLES: Absolutely, I agree. I think a big part of what got us into this mess, of course, is the policies of the past, but also the pessimism that's perpetuated and is present throughout the country. And I think that the president has the capacity, and he's proven that, that he can restore hope and confidence in the system, and also recognize that there are problems and is demonstrating his willingness to roll his sleeves up and help Americans get over these problems and address them together.

KING: We -- we're out of time. We thank Jean Chatzky, Larry Winget and Don Peebles for their expert advice.

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