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American Morning
Deadly Montana Plane Crash; FedEx Cargo Plane Crash; The New Bank Bailout; Grassroots Supporters in Campaign Mode
Aired March 23, 2009 - 08:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JOHN ROBERTS, CNN ANCHOR: Crossing the top of the hour now. And here are the top stories on our agenda this morning that we'll be breaking down for you in the next 15 minutes here on CNN.
Preliminary information in Butte, Montana, shows the pilot in the deadly plane crash did not report an emergency. The FAA confirms 14 people are dead, including seven children after a single-engine plane went down 500 feet besides its intended runway.
Federal safety officials also heading to Japan to help in the investigation of a deadly FedEx cargo plane crash there. Video -- incredible video shows the plane bouncing violently on the runway at Tokyo's Narita Airport before flipping over and erupting into flames. The two American pilots on board were killed. Weather may have been a factor. Japanese media reports 43-mile-an-hour wind gusts at the time of the crash.
This hour, the White House will announce its plan to buy billions of dollars in toxic assets that have blown up the balance sheets of our nation's banks. The goal is to make it easier for banks to start lending again, but the question is will it?
We begin the hour with developing news out of Montana. Local authorities have the crash site secured in the town of Butte awaiting federal investigators. 14 people are dead after a single-engine plane crash there. Two residents of St. Helen at California tell CNN an entire family of five, including three young children, are among the dead. Our Dan Simon is live on the scene for us this morning.
Dan, do we have any indication as to why this pilot diverted from his intended destination of Bozeman, Montana to Butte, just before the plane went down?
DAN SIMON, CNN CORRESPONDENT: We don't, John. And that's really the key question here. As you said, the pilot, sometime during that flight, changed his flight plan, originally was headed to Bozeman, Montana, then changed it to Butte. The plane actually got within a few hundred feet from the airport, which is just in front of me before it nose-dived into the cemetery behind me.
(BEGIN VIDEOTAPE)
SIMON (voice-over): The single-engine turboprop plane, a Pilatus PC-12, was just 500 feet from the runway in Butte, Montana, when witnesses say it crashed straight into the ground. VOICE OF MARTHA GUIDONI, WITNESS TO PLANE CRASH: I've never seen anything like this in my life. We were just taking a ride and, all of a sudden, we were watching this plane just take a nose-dive right into the cemetery.
SIMON: The FAA confirmed seven children and seven adults were on board. No one survived. Federal officials say the group might have been headed to a ski trip. But the destruction at the crash site leaves very few clues.
VOICE OF GERRY O'BRIEN, EDITOR, "MONTANA STANDARD": One of the eyewitnesses who ran across the street in there and took some photos said he was about 20 feet from the wreckage. It had created a large pit when it had augured in, and it just disintegrated. There wasn't much left of the plane, of the wreckage.
SIMON: The aircraft began its journey in San Diego and made a few California stops, the last of which was in Oroville, where it refueled before heading to Bozeman, Montana. The FAA said the flight diverted to Butte where it went down in the Holy Cross Cemetery, just 500 feet from the airport. The cause of the crash is still unknown.
VOICE OF BEN BERMAN, FORMER NTSB INVESTIGATOR: The loading of the aircraft is one of the things the investigators will be looking into. They will be looking into, you know, whether there was a possibility of engine failure that could have brought the airplane down, as well as many other possible crash causes, including weather and pilot performance and all kinds of things.
(END VIDEOTAPE)
SIMON: Still a couple of hours before you get daylight here in Montana, but when the sun comes up, typically, what you would see, the NTSB would come in and start analyzing the wreckage site, they would start removing bodies and, perhaps, start interviewing witnesses to see what they may have seen, perhaps they may shed some light in terms of what ultimately caused this plane to go down, John. But again, no clues at this point, and weather appears not to be a factor in this case.
Back to you.
ROBERTS: Yes, big mystery there in Montana this morning. Dan Simon for us in Butte. Dan, thanks so much for that.
KIRAN CHETRY, CNN ANCHOR: In another tragedy in the skies, the NTSB team is also on its way to Japan this morning to examine the wreckage of a FedEx cargo plane. Video captured the crash landing at Tokyo's Narita Airport. Two American pilots, the only two onboard the plane, were killed. Japanese investigators say that wind conditions of 30 to 50-mile-per-hour gusts may have contributed to that crash. We are on the ground in Tokyo this morning. The global resources of CNN bringing you the latest developments. Kyung Lah is there.
KYUNG LAH, CNN INTERNATIONAL CORRESPONDENT: Dramatic pictures capture the exact moment of impact. You can see the plane start to approach Narita Airport's runway A. The plane as it was approaching bounced once, then once again, then leaned over to the left and burst into flames. The plane ended up completely upside down. It was an enormous fire. Fire crews were on the scene within minutes trying to extinguish its very hot fire that was fueled by jet engine fuel.
Fire crews did manage to pull out two crew members, the only people aboard this cargo plane. The hospital says, though, those crew members did not survive. Both are U.S. citizens. Both are men. Their names, though, are being withheld because we are not sure if the family has been notified about exactly what has happened. FedEx did confirm that it lost two crew members in this accident.
CHETRY: All right, that was Kyung Lah in Tokyo. Earlier on AMERICAN MORNING, we spoke to John Lucich. She's a licensed commercial pilot about what may have cause that FedEx cargo plane to crash in Tokyo.
(BEGIN VIDEO CLIP)
JOHN LUCICH, COMMERCIAL PILOT: The contributing factor was most likely the wind.
ROBERTS: He was landing in pretty stiff crosswinds.
LUCICH: Very, very stiff crosswinds and potentially wind shear. Because there were reported wind shears since the day before, so they've had a lot of wind problems here. And some of the gusts were 47 knots, I believe, they were reported at.
So what you're having here is the airplane comes in and bounces, and, all of a sudden, comes up. You see the nose go down. I think that the pilot may have, based on what I see here, overcompensated like in Newark flight, and then drove that nose down causing it to bounce and flipping over to the left.
(END VIDEO CLIP)
CHETRY: That was the FedEx crash. It was the first fatal accident at Tokyo's Narita Airport since it opened back in 1978.
ROBERTS: Well, in about 40 minutes time, the Obama administration will unveil its plan to ease the credit crunch. The plan, buy billions of dollars of banks' toxic assets, which are many of the mortgages gone bad, other derivatives as well. So called mortgage-backed securities. And in turn, make it easier for banks to lend money. Earlier, I spoke to President Obama's chief economic adviser, Christina Romer, about the plan.
(BEGIN VIDEO CLIP)
CHRISTINA ROMER, PRES. OBAMA'S CHIEF ECONOMIC ADVISER: The reason that we're going in here is that this is a market that's basically disappeared, right? We don't -- it's the classic example in economics of what we call a market failure, that we don't have a well- functioning market in these kinds of things.
(END VIDEO CLIP)
ROBERTS: CNN's Suzanne Malveaux is live at the White House for us this morning. Christina Romans -- gosh, I knew that was going to happen.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: I knew that was going to happen.
ROBERTS: Christine Romans, Christina Romer here on the set. Let's start with Suzanne.
And Suzanne, we talked to Christina Romer, and I said, OK, here's what Noble Prize-winning economist Paul Krugman says, "there's wrong with the plan." She says, "oh, he is wrong." And I said, here's what Jeffrey Sachs from Columbia University says. She said, "no, he's wrong." And I said, "why would private industry want to get involved in this?" She said, "well, because they would." I mean, they are very rosy about this whole thing.
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Yes. I had a chance to talk to her, too. And I said, you know, what if this thing doesn't work. And she says, "Well, we all rise and fall together with this. Perhaps we'll do something else."
But clearly they acknowledge they need private investors to pull this thing off. It could cost as much as a $1 trillion -- $1 trillion, John, to get the bad assets off the books. They are going to partner with these private firms. The idea is that they will go ahead. The banks will offer up and sell these toxic assets to the highest bidder in an auction, but the government, it's the government, our taxpayer dollars that are going to subsidize as much as 50, perhaps even up to 80 percent of that cost.
So the big question is, is this going to really burden the taxpayers ultimately? And she said, you know, she thinks this is a good plan, a good idea, but she also acknowledged, John, that if it doesn't work, they'll just try something else.
ROBERTS: Yes. A lot of people are saying if it doesn't work, "We're in serious, serious trouble." The announcement is about 35 minutes from now. What about the timing of all of this?
MALVEAUX: Well, 8:45, you know, right before the markets open, obviously, on Wall Street. There are going to be some details about some of these private firms that are going to be participating in this whole plan so they want to jump-start this, make sure that people are confident when it comes to the market so that is what they are trying to do.
Notice, however, John -- you know, Timothy Geithner, he's had mixed reviews when he goes on cameras and he announces these plans. He's not going to be on camera. He is going to have a briefing, a kind of a pen and pad briefing it's called where we'll all take notes and talk about and get details of the plan without actually seeing him on camera. So we'll see how that actually influences, whether or not people have more or less confidence in what he actually says -- John. ROBERTS: All right. Suzanne Malveaux for us live at the White House this morning. Suzanne, thanks so much.
CHETRY: All right. Let's dig a little deeper now. We have Christine Romans...
ROBERTS: Not Christina Romer.
CHETRY: ... here "Minding Your Business" with more on this.
You know, so, she is, again, as John said, pretty rosy about it despite the fact that there had been some leading economists who say that they can spot trouble with this plan from a mile away.
ROMANS: But there are leading economists who work for President Obama who say that they've got, you know, the details worked out and they are going to try to make this work. So, obviously, there is, you know, an academic discussion about how it is going to work. But think about it this way.
I mean, it's like creating a giant investment bank. And all of the risks and a lot of the money comes from you and I to get that stuff off the banks' books. And that's what we've been talking about for months, right? About how are we going to rid the banks' books of these toxic assets so they can start lending again?
And for the past -- I mean, John, you pointed out, weren't we talking about this last fall? Didn't the Paulson administration or the Paulson Treasury Department dismiss this? Well, things have changed and come back around so many times since last fall. But here we are again back at these toxic assets plan.
Some of the challenges, how are you going to track the private investors in this very populous mood right now. I mean, look at the last week. I mean, private investors and Wall Street had been vilified over the past week. How are you going to attract private investors and convince them that no, Congress is not going to come after your profits someday down the line.
Remember, taxpayers want profits. Taxpayers want these private enterprises to succeed. What about executive compensation limits? Some of this money is going to be coming from the TARP, that original bank bailout. There are now strict guidelines on executive compensation. Are you going to try to tell, you know...
CHETRY: Wait. There are strict guidelines or (INAUDIBLE)?
(CROSSTALK)
ROMANS: On the TARP money now.
CHETRY: But this is still moving through. And this has been approved. The president has signed it, right?
ROMANS: The TARP guidelines. I think there are now TARP -- aren't there guidelines on the TARP money for executive compensation guidelines. We know that there are executive compensation guidelines on TARP money now. Yes, this is true. I'm not sure if it's been signed, sealed and delivered, but that's the way they are going.
CHETRY: But the president expressed reservations in a "60 Minute" interview...
ROMANS: Right.
CHETRY: ... with executive compensation caps, because of this very reason.
ROMANS: Right. Because how are you going to convince, you know, an oil billionaire in the Middle East that he should somehow, you know, get taxed above anything over $250,000? I mean, there's that, and then there's the public support, convincing the public that Wall Street has to be part of the solution.
Wall Street created the problem and now, you know, financiers created the problem, and now financiers have to help solve the problem. That's going to be a hard sell.
ROBERTS: Find out more in just a little more than half an hour here.
ROMANS: Sure.
ROBERTS: Christine, thanks so much.
Right now, hundreds of millions of dollars are being spent on roads, bridges, and other infrastructure projects. But is that the best way to get ourselves out of a recession? Hear what Pennsylvania Governor Ed Rendell says when he joins us coming up live.
And just how bad is the economy? President Obama says the global financial system could still implode so why is he smiling? Hear what he told CBS' "60 Minutes." It's 12 minutes now after the hour.
(COMMERCIAL BREAK)
ROBERTS: Fourteen minutes after the hour. Welcome back to the Most News in the Morning.
The economy may be job one, but it's not the most difficult decision President Obama has had to make since taking office. That was sending more troops to Afghanistan. Here's what he told CBS' "60 Minutes" about U.S. strategy there.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We can't lose sight of what our central mission is, the same mission that we had when we went in after 9/11. And that is these folks can project violence against the United States's citizens. And that is something that we cannot tolerate.
But what we can't do is think that just a military approach in Afghanistan is going to be able to solve our problems. So what we're looking for is a comprehensive strategy, and there's got to be an exit strategy.
(END VIDEO CLIP)
ROBERTS: He also took a swipe at former Vice President Dick Cheney for saying that his policies have made America less safe.
(BEGIN VIDEO CLIP)
OBAMA: How many terrorists have actually been brought to justice under the philosophy that is being promoted by Vice President Cheney? He doesn't made us safer. What it has been is a great advertisement for anti-American sentiment, which means that there is constant effective recruitment of Arab fighters and Muslim fighters against U.S. interests all around the world.
(END VIDEO CLIP)
ROBERTS: Strong words there from the president. And he said the hardest thing about being president is staying focused because he had so much on his plate.
(BEGIN VIDEO CLIP)
STEVE KROFT, CBS'S "60 MINUTES": You're sitting here. And you're -- you are laughing about some of these problems. Are people going to look at this and say, "I mean, he's sitting there just making jokes about money" -- how do you deal with that? I mean, explain the mood in your laughter.
OBAMA: Well, yes, I mean, there's got to be...
KROFT: Are you punch drunk?
OBAMA: No, no. There's got to be a little gallows humor to get you through the day. You know, sometimes my team talks about the fact that if you had said to us a year ago that the least of my problems would be Iraq, which is still a pretty serious problem. I don't think anybody would have believed it. But we've got a lot on our plate. And a lot of difficult decisions that we're going to have to make.
(END VIDEO CLIP)
ROBERTS: With the president there with Steve Kroft suggesting that if you didn't laugh once in a while, you would probably cry -- Kiran.
CHETRY: All right. Well, so you thought you've seen the last of the people going door-to-door campaigning for President Obama. Well, you actually haven't. Obviously, they are not campaigning for president anymore, but they are campaigning for the president, I guess you could say. We're going to talk about why they may be showing up at your door. It's 17 minutes after the hour.
(COMMERCIAL BREAK) CHETRY: Welcome back to AMERICAN MORNING. Today, more than $100 billion are now in the pipeline from Washington to rebuild the nation's roads and bridges, but with so many families struggling to make ends meet, is that the best use of tax dollars?
Our next guest says yes. I'm joined by Pennsylvania Governor Ed Rendell. He's co-chair of the Building America's Future Coalition, along with Governor of California Arnold Schwarzenegger, and New York City Mayor Michael Bloomberg. The three actually met with the President Obama on Friday.
Governor Rendell, great to have you with us. Thanks.
GOV. ED RENDELL, PENNSYLVANIA: Good morning, Kiran.
CHETRY: You talk about this infrastructure bank saying that, you know, it will probably be about $1.6 trillion all told to be able to improve our nation's infrastructure. Now when you met with President Obama on Friday, did he indicate willingness to fund such an investment?
RENDELL: Well, we were talking about more than just the stimulus. Look, our nation's roads are in trouble. They are congested and choked. Our bridges are in terrible conditions. In New Orleans and Cedar Rapids, our levees are breaking. We need to do something, and we need to do it over a prolonged period of time.
The American Society of Civil Engineers estimates we've got almost $2 trillion infrastructure gap right now just to repair what we've got -- to build a high-speed rail. A line, for example, would cost much, much more. So we've got to go about a long-term proposal.
Now, obviously, this is not the greatest time to spend money conventionally in the federal budget. So we talked to President Obama about an important change. One, creating an infrastructure bank that could be, in part, funded by private investment as opposed to, you know, government dollars.
Number two, changing the way we do infrastructure. Polls have shown that the public wants to spend money on infrastructure, but don't want to spend it through the normal system, the political system. They want accountability. They want decisions made by experts, and that's what the infrastructure bank would do.
CHETRY: Critics are arguing that, you know, we have to pick and choose a bit here. Yes, we're in trouble, we need a stimulus, we need, obviously, to repair, anybody can just look around their own, you know, local area, and say I can tell you five things that needs to be repaired right now. But according to the Congressional Budget Office, we're looking at a nearly $10 trillion deficit over the next decade and that there has to be cuts somewhere. It can't be all spending.
RENDELL: Well, that is true. And we have to pick and choose. But, remember, you saw what happened in Minnesota. You saw what happened in Cedar Rapids, when the levees were insufficient. The infrastructure that's in poor condition is a public safety hazard. It's also economic competitiveness. How fast we move goods in this global economy will determine, in great part, whether the American economy stays viable. So this is a crucial, crucial need to invest in a five to ten-year program. And by the way, the best upside to it, is every billion dollars of infrastructure spending, according to experts, creates 25,000 jobs.
CHETRY: Right.
RENDELL: And plenty of orders for factories, orders for steel factories, lumber, concrete, asphalt. And that's exactly what we need. That's why infrastructure in my judgment is the best part of the stimulus program to get people to work.
(CROSSTALK)
CHETRY: And that's what I want to ask you about. I just want to say one thing. Last time we had governor -- the governor of Minnesota on, he said it was a design flaw not crumbling infrastructure that caused the I-35W Bridge. I just to make sure because he'll call us.
RENDELL: I understand. He is very sensitive about that.
CHETRY: He is.
RENDELL: But notwithstanding that. It's a fact that there are tens and tens of thousands of bridges in America in dangerous conditions.
CHETRY: Absolutely. And now, I want to ask you about that. As you said, putting people back to work. The infrastructure plan was something that was heralded as being able to provide some sort of immediate stimulus, meaning if there is a shovel-ready project, you can get people on the job, you can put people back to work.
But we saw even in places like in your own state, that shovel- ready doesn't always mean shovel-ready because of various, you know, snags, hang-ups that happen in local politics, the local needs of the community. How do you get these projects moving faster and create these jobs now?
RENDELL: Well, remember, it depends on the definition of shovel- ready. What the Obama administration has set as a goal is that all of these projects be ready to start construction within six to nine months. That's the case in Pennsylvania. We're going to have -- we have a billion, 26 million dollars. We're going to have most -- all of that money contracted in six months and work going on in about 70 percent, 80 percent of that. You're going to see the work start heavily in May, June, July, August and September.
You're going to see people packing lunch pails again, going back to work that haven't worked for a while. You're going to see there are orders pouring in to Pennsylvania steel plants and concrete and asphalt plants, and it's going to be heavy starting in May -- May, June, July, August, and September. And that's exactly what we need. My state lost 43,000 jobs in February. CHETRY: Right.
RENDELL: We need to put people back to work and we need to put them back to work soon. But you can't just snap your fingers and assume something is going to be shovel-ready. But when you consider that we got the go ahead, I just signed the certification for my infrastructure money last week, the middle of March. So for work to begun in the middle of May, that's pretty good. That's 60 days.
CHETRY: Yes. That's lightning speed for the government, too, right?
RENDELL: Yes, sure. No question about it.
CHETRY: Governor Ed Rendell from Pennsylvania, thanks so much for joining us this morning.
RENDELL: Thank you.
CHETRY: John?
ROBERTS: A Hollywood tabloid television show goes inside the Beltway. Our members of Congress really the next Britney, Paris or Lindsay? We are asking TMZ's executive producer Harvey Levin just ahead. It's 24 1/2 minutes now after the hour.
(COMMERCIAL BREAK)
CHETRY: Welcome back to the Most News in the Morning. In about a half hour, the Obama administration will unveil its plan to tackle the banking crisis, and try and get credit flowing again. The White House will have some help, taking their message to the streets. Thanks to an army of Obama supporters who are once again operating almost like campaign mode.
Jim Acosta is live in Washington with more on the story for us.
Hey, Jim.
JIM ACOSTA, CNN CORRESPONDENT: Good morning. President Obama won the election with the help of an army of grassroots supporters who organized online, then took their message to the streets. Now, the president is calling on his volunteers once again to sell more than a campaign.
(BEGIN VIDEOTAPE)
ACOSTA (voice-over): Don't tell them the race is over. Once volunteers for the Obama campaign...
UNIDENTIFIED MALE: I just want to ask you if you support that and if you're willing to the sign this.
UNIDENTIFIED FEMALE: Oh, definitely.
ACOSTA: ... a vast grassroots network of supporters is back on the trail...
UNIDENTIFIED MALE: Basically, here's the plan.
ACOSTA: ... reactivated. This time, to sell the president's agenda.
UNIDENTIFIED MALE: Could you be interested in signing up?
UNIDENTIFIED MALE: Well, I'm interested in talking about it.
UNIDENTIFIED MALE: OK.
UNIDENTIFIED MALE: I'm not saying that I'm interested in supporting all of his plan.
UNIDENTIFIED MALE: OK.
UNIDENTIFIED MALE: I'm part of a nationwide movement today called Organizing for America.
ACOSTA: Michael Lafemina was one of hundreds of volunteers who went door-to-door from New York...
UNIDENTIFIED FEMALE: No money is involved.
UNIDENTIFIED MALE: Really? I've got my checkbook here.
ACOSTA: ... to California on behalf of something called Organizing for America, a project of the Democratic Party run by remnants of the Obama campaign.
MICHAEL LAFEMINA, OBAMA VOLUNTEER: I don't feel like I'm volunteering for President Obama. I feel like I'm volunteering for myself, for our country, for our democracy.
ACOSTA: How do they do it? Using the campaign's old e-mail list, Organizing for America alerted supporters to visit its Web site, where a message from the president was waiting.
OBAMA: Talk to some neighbors and let people know how important this budget is to our future.
ACOSTA: And voila!
UNIDENTIFIED MALE: If you can provide your name, some contact information, we would send you some information.
UNIDENTIFIED MALE: I would be happy to do that.
ACOSTA: The mission on this outing: to blunt criticism from Republicans...
SEN. JUDD GREGG (R), NEW HAMPSHIRE: If we maintain the proposals which are in this budget, over the 10-year period that this budget covers, this country will go bankrupt.
ACOSTA: ... and even a few skeptical Democrats over the president's budget.
UNIDENTIFIED MALE: I'm especially concerned about the long term.
UNIDENTIFIED MALE: He's not trying to pass the budget. It's coming out of my pocketbook.
ACOSTA: As Michael Lafemina found on Long Island, not everybody is sold.
UNIDENTIFIED MALE: He's already crippled the (EXPLETIVE DELETED) economy. Him and the Democrats. I don't care. Let them film it.
ACOSTA: These volunteers insist they can take the heat.
UNIDENTIFIED MALE: Keep up the good work, Obama.
UNIDENTIFIED FEMALE: We support him 500, 2,000 percent.
(END VIDEOTAPE)
ACOSTA: That's right, let them film it. Now, if it works, Organizing for America could put its volunteers to work again on other White House plans, giving the administration a ground force that can gather signatures and work the phones to push the president's agenda. It has all the makings of a campaign before the re-election campaign, Kiran. They're not quite putting the band back together, but it's close.
CHETRY: Yes, exactly. And they are certainly getting an earful depending on whose door they knock on.
ACOSTA: Yes, absolutely.
CHETRY: Thanks so much, Jim.
John, I don't care! I don't care! Let them film me!
ROBERTS: Exactly. That guy had his opinions and he wasn't shy about sharing them, that's for sure.
It's half past the hour, and here are the big stories on our agenda in the next half hour. First, breaking news. Two deadly plane crashes both involving Americans. The first in Butte, Montana. The FAA says 14 including seven children were killed after a plane crash and burn in a cemetery. Federal investigators are on their way right now.
And in Tokyo, Japan, a FedEx jet crashes into a fireball. The jet bouncing off the runaway before bursting into flames. The pilot and co-pilot were killed. They were the only ones on board.
And finally, new details on the revamped bank bailout just minutes away, Treasury Secretary Timothy Geithner will roll out the White House plan to tackle the banking crisis and get loans flowing to families and businesses again. Well, the first family have graced the covers of "People" and "Us Weekly." Now a Web site and television known for chasing down Hollywood celebrities is turning its cameras on Capitol Hill. Are politicians really the stuff of tabloid fodder? Harvey Levin is the host and executive producer of TMZ's television show, and he joins us now live from Los Angeles this morning.
Harvey, thanks for being up at this ungodly hour in Los Angeles. I know that you work a pretty late work day, so thanks for getting up. We really appreciate it.
HARVEY LEVIN, TMZ HOST: No problem, John.
ROBERTS: So why are you turning your sights on Washington? Can you really make celebrities out of politicians?
LEVIN: Well, we've been there for a year now, and I love it. And my feeling about this is that there are people, a lot of people in this country who want to care about politics and they don't and they feel badly that they don't. I think what we can do is we can show a lot of people who never look at political stories, the personalities of Washington, D.C. and there are personalities. And once they get invested in the people, I think they're going to start caring about what those people are saying.
ROBERTS: One of the personalities that you seem to be enamored of is Congressman Aaron Schock. You followed him around a little bit. We got some videotape of that. Let's show it to our folks at home.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Congressman, what would you say has been as fair as you or President Obama?
REP. AARON SCHOCK (R), ILLINOIS: I don't know. I have to match up sometime.
UNIDENTIFIED MALE: How is the nightlife in D.C.?
SCHOCK: I haven't been out.
UNIDENTIFIED MALE: No?
SCHOCK: No.
UNIDENTIFIED MALE: Just too much work?
SCHOCK: That's right. All work, no play.
(END VIDEO CLIP)
ROBERTS: Aaron Schock of Illinois there, a 27-year-old guy, maybe an up and coming star in Congress. Yesterday, Howard Kurtz had him on "Reliable Sources" and asked him to show his abs. He didn't take the bait. But what are you trying to do here, Harvey, following these congressmen around like that, asking them very personal questions?
LEVIN: Well, I mean they're not very personal questions. I mean, we're trying to like get a little bit of their personality out of them. We found Senator Burr not too long ago driving a '74 VW thing with the top down in a snowstorm and it was hilarious! And he said that he has never seen this kind of reaction, that all these people in North Carolina who never really talk to him about politics and seen this and they just thought it was really, really engaging. And I think it's the same thing with Schock that he is reaching a lot of people that he couldn't reach if he just played inside the Beltway.
ROBERTS: So at this point, it's all a lot fun. You're trying to uncover some of their personalities but you know, TMZ is known for covering celebrities when they are in less than desirable circumstances. Are you going to start going after these politicians the way you go after some celebrities? You know, I think back to 1988 in the election campaign, Gary Hart's famous line "catch me if you can." Are you going to be out there trying to dig up dirt on these guys as well?
LEVIN: We're not bedroom police. And if you look at the site, I mean, so much we do with the site is just benign fun. I will say that, from time to time, a good story does come along and a couple of weeks ago, we did a really good story, I think, on Northern Trust where we followed all of these people around. This is a bank that got $1.6 billion in bailout money. We filmed all of the stuff that they were doing, all of these lavish parties and our story caused them to give $1.6 billion back to the taxpayer. So my feeling is we can have fun and then, in between, we can do some stuff that maybe is a little bit more important.
ROBERTS: Well, you certainly have broken a lot of stories out there in California. Welcome to Washington, Harvey, and TMZ.
LEVIN: Good to be with you this morning.
ROBERTS: All right. Thanks so much.
We got 34 1/2 minutes now after the hour.
(BEGIN VIDEO CLIP)
CHETRY (voice-over): While big banks get bailouts, what do little banks get?
UNIDENTIFIED MALE: We sometimes have a line out the door of people transferring their deposits from those institutions to us.
We wanted to go back to the old days. We wanted to go back to face-to-face banking.
CHETRY: The new bonus of doing business with a little bank now ahead on the most news in the morning.
(END VIDEO CLIP)
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CHETRY: And welcome back to the Most News in the Morning.
Bigger is definitely not better right now in the banking industry. We're seeing these big commercial banks just bury under a mountain of debt and needing the government's bailout but these smaller community banks and there are many out there actually thriving. CNN's Jason Carroll has the story for us. Hey.
JASON CARROLL, CNN CORRESPONDENT: Hello to you. They may not have the name recognition but some of these start-up banks say that they can provide the same services that some of the larger banks can and they also say that their customers money is just as safe.
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CARROLL (voice-over): Just as words spread, several banking giants were buckling under the strain of the economy, a little known smaller bank was muscling is its way into the financial world. You opened, what, January, just about January?
ROBERT LONG, EXECUTIVE VP, HANOVER COMMUNITY BANK: Yes, we have been opened about two months now. There was some hurdles. I mean, we were raising money literally when people had newspapers in front of them saying that the banks were going out of business.
CARROLL: Robert Long founded Long Island's Hanover Community Bank. It's considered small by industry standards with less than $1 billion in assets but unlike bigger competitors with trillions, Hanover doesn't need a bailout. And, so far, how have you been doing?
LONG: Well, we are - we've exceeded our expectations.
CARROLL: Hanover hoped to raise $20 million in cash by selling certificates of deposit but ended up raising more than twice that.
LONG: We wanted to go back to the old days. We wanted to go back to face-to-face banking.
CARROLL: A key to success? Knowing the customer, asking for a home mortgage or business loan. It's a formula that is working around the country.
UNIDENTIFIED MALE: Business is very good.
CARROLL: Valley Green Bank, another community bank in Philadelphia, opened three years ago. Today, customer deposits are way up.
JAY GOLDSTEIN, PRESIDENT, VALLEY GREEN BANK: Every time there is bad news about, you know, one of the large banks, we sometimes have a line out the door of people transferring their deposits from those institutions to us.
CARROLL: Much like Hanover, Valley Green lends primarily to those from the community, like florist Herb Rothe. HERB ROTHE, ROTHE FLORISTS: They gave us the attention that probably I wouldn't expect from any other big bank.
CARROLL: But some financial experts say there can be a downside to small banks.
BART NARTER, CELENT RESEARCH'S BANKING GROUP: You need bill pay, you need mobile banking and you need all of these things that a small bank just doesn't have the mass to deal with.
CARROLL: Hanover says technology isn't everything.
LONG: You call an 800 number and you get somebody that's not in this country, I don't think that's banking to tell you the truth. That's technology.
CARROLL: And some customers joke these start-up banks have another advantage.
UNIDENTIFIED FEMALE: It's clean and it's going to take a while before they get into trouble.
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CARROLL: Some banking experts say that one of the problems community banks can run into getting off the ground is passing all of the financial tests, the FDIC, the Federal Deposit Insurance Corporation requires in order to get backing on customers' deposits. The banks we profiled met those requirements. Now Hanover Bank says it may open more branches very, very soon.
CHETRY: We talked about this before. You know, businesses and certain, you know industry being able to rise out of the ashes? And maybe small banking, the community banks are making a comeback.
CARROLL: And you know, at the end of the day, what it really comes down to is doing your research whether it be a large bang or a community bank, know your bank.
CHETRY: Don't just go there because they have a T-shirt and lollipops outside the door, right? Do some more research.
CARROLL: Exactly.
CHETRY: Jason, thanks.
ROBERTS: Well, many people are just happy to have a job in this economy. But here is one for you. Our personal finance editor Gerri Willis is here to say don't settle. How you actually can get a raise in this economy. Gerri is here to kind of poke the bear and tell us how to do it. Forty-two and a half minutes after the hour.
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ROBERTS: Welcome back to the Most News in the Morning. Companies across the United States are certainly looking for a way to cut costs these days. A recent survey says nearly half of them are freezing salaries is one way to do that but there are still ways to get a raise. Even in this economy. Our personal finance editor Gerri Willis joins us now to tell you how.
CHETRY: We're all ears.
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: I didn't say it was easy, right? OK. So don't hold me to that. You can get a raise. It's more difficult. But, hey, it is not impossible. Look. Your value as an employee is not entirely dependent on the economy. It's about what you bring to the company. And of course, you have to put together a good strategy to actually get that raise.
Here are some do's and don'ts. All right. It starts with timing it right. Look, if you want a raise, it's best to ask for that raise after you've made some major accomplishment out there. Maybe you brought in an important client for the company. You've got to make sure you got the goods to ask for that raise.
Bottom line, you have to be flexible. Highlight your accomplishments, make sure your boss knows what you've done for the company. It's all about that, what do you bring to the bottom line? Absolutely critical that you have something to brag about. Now, there are don'ts as well. Obviously, you want to make sure that, you know, you're not begging, you're not whining.
Don't get angry and keep it professional and don't make it about you. It has to be about the company. How am I adding to the bottom line? Don't be realistic and have an idea of what you should ask for. That means you need to know how much money you should be making in this economy, maybe your salary has been held back for a long time and you just want equity. That is a decent argument if you're really delivering the goods and of course, it helps to be persistent.
ROBERTS: So what happens? What do you do if you think you've gone to your boss to ask for a raise? Even a mild raise? And you think you've run up against a brick wall?
WILLIS: Well, you got to think a lot of people will encounter that. It helps to be persistent obviously, ask the boss if he or she will consider a second meeting in six months down the road and maybe you can get an accelerated annual review so you can ask for that raise then.
Look, if you can't get a raise, there are lots of other goodies in the company's bag they can help you with. Maybe some additional education, maybe you take Fridays off and work from home. All kinds of things that your boss could deliver on if you are really bringing in the goods for the company. The bottom line here is they have to be getting something in order to give you that raise.
ROBERTS: One of my favorite books ever, "The Last Lecture," Randy Pausch. The late Randy Pausch said the walls are there to show people how much you really want it.
WILLIS: That's a great way of putting it. Yes, you definitely have to, obviously, bargain and have something to bargain with. A lot of people just want to go in and say well this is what I deserve or my light bill went up. That's not enough.
ROBERTS: All right. Gerri, thanks so much for that.
WILLIS: My pleasure.
ROBERTS: It's 46 1/2 minutes now after the hour.
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ROBERTS (voice-over): Would you rent out a room to a perfect stranger to raise some extra cash?
UNIDENTIFIED MALE: More than anything, it's taken the pressure off a lot of things.
ROBERTS: What you need to know about the rent a room trend, ahead on the Most News in the Morning.
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CHETRY: Welcome back to the Most News in the Morning.
And tough times people have to get creative to make ends meet, but would you rent out a room to a perfect stranger? How about just your living room? Our Thelma Gutierrez looks at some unusual living arrangements.
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THELMA GUTIERREZ, CNN CORRESPONDENT: Kiran, John, it's a trend that has taken off. People renting space in their homes and apartments just to make end's meet. One Los Angeles rental agency told us their business is booming. It's up 100 percent over last year.
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UNIDENTIFIED FEMALE: Is studio for 1,135 still available?
(speaking in foreign language)
GUTIERREZ (voice-over): For many people across the country, it's a whole new way to share space.
MARK VERGE, WESTSIDE RENTALS: A ton more inquiries in the roommate rentals and people renting out rooms in their house, which I've never seen before. It's coming in droves.
GUTIERREZ: At Westside Rentals in Los Angeles, the room for rent business has doubled in the last year.
ALICIA ALEXANDER, RENTING OUT LIVING ROOM: I've actually fallen behind two months.
GUTIERREZ: Alicia Alexander is unemployed and two months behind on rent on her one bedroom apartment in San Diego. She placed this ad on Craigslist to rent out our living room for $475 a month.
ALEXANDER: The living room has got the futon for sleeping. There's an Ikea wardrobe here for hanging things up.
GUTIERREZ: So far, Alicia has gotten 20 calls. Ryan and Becky Wolfe own a three bedroom in Marina Del Ray, California. They decided to rent out one of their rooms to Eliza Duncan for 600 a month, including space in the fridge.
BECKY WOLFE, HOMEOWNER/LANDLORD: Eliza's share is definitely not as big as ours, but she's got the fresh and nice drawer.
RYAN WOLFE, HOMEOWNER/LANDLORD: Financially, I would really say more than anything it has taken the pressure off a lot of things, particularly with the economy, with not knowing if we'll have jobs. My wife is a teacher and I work in a corporate setting. You know, if we'll have jobs.
GUTIERREZ: It's good for Eliza, too.
ELIZA DUNCAN, ROOM RENTER: Rent a room for a lower cost and only about a mile from the beach, which is quite great
GUTIERREZ: But they say privacy can be tricky.
ALEXANDER: Renting out the living room, unfortunately, there's not a lot privacy as far as, you know, intimate times. But, I mean, I try to provide as much privacy as I can.
GUTIERREZ: All issues to work out before sharing space. If you're a homeowner, you can rent to whomever you choose but if you're a renter you need to clear it with the property owner or owner first. Our rental expert says in this economic climate some property owners are saying OK because they want to keep those properties occupied and the rent money coming in. Kiran, John?
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ROBERTS: Thelma Gutierrez reporting for us this morning. Thelma, thanks so much.
So let's say that money is tight. You lost your job. Now, maybe it's time to hit the road. Richard Roth is heading out with a New York City cab driver and wait until you hear what he used to do for a living. It's eight minutes now to the top of the hour.
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CHETRY: Welcome back to AMERICAN MORNING. Fifty-five minutes past of the hour. A check of what is new.
The main suspect captured alive in November's deadly three-day siege in Mumbai, India, is declaring he is a Pakistani national. India's government suspected that a Pakistani terror group was behind this attack. Special prosecutor on the case is also confirming that the suspect is asking for legal aid.
Global markets are starting out the week with a bit of a surge. Hong Kong's main market adding nearly five percent today in Japan's Nikkei, adding nearly three and a half percent. Mid day trading across Europe also showing some strong gains for the main markets. Right now, the Dow futures up more than 200 points right now.
And Alaska's Mount Redoubt erupted four times overnight, throwing ash and smoke more than nine miles into the air. The National Weather Service says that ash could start to fall later today. The winds are pushing the huge plume away, though, from the state's largest city, Anchorage. It hasn't had an eruption in 20 years.
ROBERTS: Yes. It's been rumbling. Spectacular pictures this morning.
Well, many people who lose their jobs, start over in their careers or do something else to tide themselves over for a little while. How is this for a drastic switch from banker to cabbie. Richard Roth is out on Columbus Circle in Manhattan with just that story. Richard, good morning to you.
RICHARD ROTH, CNN CORRESPONDENT: Good morning, John. Yes, there are max fleets out here. The most cabs ever in New York. We're going to let this man go. He's been trying to move on. We followed one bank worker who took a lot of interest in the taxi trade.
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ROTH (voice-over): Laid-off workers like Michael Dick are turning to taxi driving to make money.
UNIDENTIFIED MALE: It's amazing. You never get bored.
ROTH: Dick was laid off after 13 years at the financial house UBS. A $75,000 a year back off his job.
UNIDENTIFIED MALE: And I was promptly escorted out of the building.
ROTH: A bank man, now a hack?
UNIDENTIFIED MALE: Naturally, while I was working at UBS, I made a lot more money, however, I had ten times the amount of stress. The beautiful thing about having this business is it's my own business.
ROTH: What would you rate the public image of a new taxi driver?
Don't complain that you can't find a taxi. Classrooms are packed as the newly unemployed mix with traditional immigrant cabbies. New York City says taxi licenses have hit an all-time high, near 46,000.
ANCHEW VOLLO, TAXI SCHOOL INSTRUCTOR: Whenever the economy is doing bad, we do much better. Eye contact very important.
ROTH: When you see your next driver, it could be a chef
UNIDENTIFIED MALE: Definitely, I'm a victim of this economy. It's a lot less job, you know?
UNIDENTIFIED MALE: I can't talk to you now. I'm driving. Bye- bye.
ROTH: A cabbie with manners who speaks English well and wears a tie?
UNIDENTIFIED MALE: I mean, a pedestrian that was in harm's way, I might, you know go like that to warn them, but I never do this kind of thing. You know? It might be a tap. To me, that's the way a horn should be used.
ROTH: By chance, his first passenger is a banker.
UNIDENTIFIED MALE: You know, young lady? I am the hired help and you are the boss.
JANIT GREENWOOD, PASSENGER: I think it's a wonderful thing that he picked himself up and found something to do.
ROTH: Not everybody was quick to praise.
UNIDENTIFIED MALE: You got to be careful!
UNIDENTIFIED MALE: I'll try to be more careful.
UNIDENTIFIED MALE: I have passengers? Here!
UNIDENTIFIED MALE: I apologize.
ROTH: He still misses UBS which he drives by.
UNIDENTIFIED MALE: Actually, I'm a better fit as a cab driver than I was as a banker.
ROTH: A cabbie banker doesn't faze the next passenger.
VINCE GONZALEZ: Nothing surprises me today. You know, I was caught in the corporate downsizing.
ROTH: Michael Dick says his focus on customer service has brought large tips.
UNIDENTIFIED MALE: Cash, cash works.
ROTH: He is enjoying the ride. This is like a great life adventure for you?
UNIDENTIFIED MALE: This is. This is. This is like a Broadway show.
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ROTH: Now compared to Michael Dick, the other drivers are scratching, John, for every dollar, because he leases. He has got a better deal. He is probably going to retire next year. The rest of the fleet, I mean, every tip counts and I'm sure you're a big tipper.
ROBERTS: Oh, absolutely, yes. I always hit at least the 20 percent button, if not the 25, depending on how good the cabbie is. But let me ask you this question because I'm fascinated by this particular aspect, he says he has less stress. Much less stress driving a cab. He's driving a cab in New York City. How much stress did he have as a banker?
ROTH: I asked him that. I just think that he's a people person as he described himself. He also sells logos on hats. He's got some side businesses. I think he's quite unique. I don't think there many are like him there. I just think he sees the end coming, you might say, for being out in the field working and he likes talking to people.
CHETRY: That is funny. I would love to have a cab driver like him. He's a character. May be will be in a Broadway play.
ROTH: He gets 30 percent to 40 percent tips, he says.
ROBERTS: Richard, thanks for being for bringing that to us as only you can. Appreciate it. Great to see you this morning. Well, thanks so much for joining us on this AMERICAN MORNING. We'll see you back here again tomorrow.
CHETRY: And right now, here is CNN NEWSROOM with Heidi Collins.
