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Air Force Pilot Caught in 'Don't Ask, Don't Tell'; 'A New Beginning' for GM; Air France Plane Missing
Aired June 01, 2009 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
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LT. COL. VICTOR FEHRENBACH, U.S. AIR FORCE: Right, Kyra. And that's one of the reasons I wanted to step forward. You know, there have been 12,500 brave service members discharged under this unconstitutional law for the last 15 years, and I had hoped that I would be able to speak for them, because I'm just one small example of those 12,500, and just one story and one dream that's been ended under this policy.
KYRA PHILLIPS, CNN ANCHOR: Well, here's what the Air Force said about your situation. "Regardless of personal opinions on the policy or how much we as Airmen may respect and value Lieutenant Colonel Fehrenbach's service, the law as it stands is that a person who has a homosexual orientation can serve in the military so long as he or she does not engage in homosexual conduct."
Pushing this forward now, what needs to be done, in your opinion, to change this law? And how do you think, if it is changed and the policy goes away, how it will impact the military?
FEHRENBACH: Well, to tell you the truth, Kyra, when this first came to light, my whole plan was to keep this quiet and secure a civilian job and move on. I didn't want my family to know or anyone I worked with. It was only until probably about September when I heard President Obama's promise that he wanted to repeal this policy and replace it with one of nondiscrimination, that I had hoped.
And that's when I changed course and decided to speak out and fight and go towards my board of inquiry. And so I had hope and faith in President Obama that he would fulfill his promise, and I still have that hope.
As far as whether I'll be able to continue to serve, I have no doubt. Two weeks ago, I obviously went on national TV and brought my story forward, and since then I have gone to work every day and there has been absolutely no impact on morale, good order, discipline and unit cohesion. Military professionals are just that, they're very professional and they're disciplined, and they carry out the mission. And that's exactly what my squadron has done since I've come out.
PHILLIPS: Lieutenant Colonel Victor Fehrenbach.
We will definitely follow your story. Really appreciate your time and your honesty, and how straightforward you've been.
Thanks, Victor.
FEHRENBACH: Thank you, Kyra. Thank you.
PHILLIPS: And pushing forward into history-making bankruptcy and beyond, in the wake of the latest industrial bankruptcy case in U.S. history, General Motors and the White House say Chapter 11 isn't the end of the story. But even if all goes quickly and smoothly, and recession gives way to recovery, the new GM will be a shadow of its former self.
For one thing, the U.S. government will own most of it. President Obama says that he doesn't want to run a car company just to make GM healthy again, and then "get out quickly." The government's putting in another $30 billion, and the company's cutting another 20,000 jobs and closing more factories.
The president acknowledges that the short term will be rough but says the long term demands drastic action.
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BARACK OBAMA, PRESIDENT OF THE UNITED STATES: And while the GM of the future will be different from the GM of the past, I am absolutely confident that if well managed, a new GM will emerge that can provide a new generation of Americans with the chance to live out their dreams, that can outcompete automakers around the world, and they can once again be an integral part of America's economic future. And when that happens, we can truly say that what is good for General Motors and all who work there is good for the United States of America.
(END VIDEO CLIP)
PHILLIPS: Three GM plants are shutting down for now, but could reopen down the road. That list includes the former Saturn plant in Spring Hill, Tennessee.
CNN's Sean Callebs is there.
And Sean, this must come as a particular blow to Spring Hill. We talk about this whole community was formed because of that plant.
SEAN CALLEBS, CNN CORRESPONDENT: Right. Yes, and you're talking 3,000 employees, their families, and these are people who moved here from other places around the country where they had worked for GM plants that shut down and brought them here. So now some people are thinking about moving on to Michigan and working at a plant there.
Really very difficult time for the folks here. Three thousand employees; about 2,500 of these jobs are going to be gone by the end of the year.
This standby capacity is a fancy name for saying look, we're shutting you down for the time being. However, if the economy rebounds and if there's a need to start making American-made cars again, we're going to reopen this facility. GM just invested about $1 billion in the Spring Hill facility two years ago to bring it up to speed and make it as modern as possible. So for a lot of workers, they are hoping the economy turns around, and turns around quickly.
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ERIC SASAKI, GM WORKER: There's a lot of hope that this economy will turn around, that capacity for car sales to pick up. And I think with GM running leaner and hopefully meaner, that we can keep market share or grow it.
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CALLEBS: And Kyra, all is not lost. GM plans on making a smaller car in a few years, and this is one of the facilities that could reopen to make that smaller car, right here in Spring Hill, Tennessee -- Kyra.
PHILLIPS: Sean Callebs, appreciate it.
Well, Spring Hill is the town that GM built, and the Greens are the family who helped build GM. Three generations of service, now they're wondering what the new company holds for them. The Greens will join us live from Lansing in just a little bit.
And not only is GM shrinking its dealership network, it is getting smaller, too.
CNN's Maggie Lake is at a Pontiac Buick GMC dealer in Green Brook, New Jersey.
Maggie, we know that one of those brands will be going away no matter what, right?
MAGGIE LAKE, CNN BUSINESS CORRESPONDENT: That's right. And they certainly recognize that here.
But Kyra, it's a day that's full of sort of mixed emotions, their sadness about the things that will be no longer, some of those brands. And, of course, a lot of the folks here really feeling for those GM employees who found out that they're out of a job. But I have to tell you, there is also a lot of relief and confidence, believe it or not.
Aside from the brands going away, they also sell brands here that they feel are the future to GM -- the Buick Enclave, the GMC Acadia behind me. And, in fact, the owner, David Fred (ph), says last week was his best week in sales in nearly eight months.
They are hoping here that this bankruptcy, a speedy bankruptcy, is going to allow GM to get back in the kind of financial health to allow them to get these products out there and compete on a level playing field. Of course, key to that is, are the customers going to stick with them?
We caught up with one and asked her about that. (BEGIN VIDEO CLIP)
JANAYNA BROCKNER, GM CUSTOMER: I love the car. I don't really -- I didn't really care at that moment, so I just was going to purchase the Hummer no matter what.
LAKE: What about -- you know, did anyone say to you afterwards, what, are you crazy, that brand's being discontinued, why are you buying that?
BROCKNER: Yes, I heard that a lot, well, they're not going to make the Hummers. I said, "Good, I'll have a classic." They'll stop making it, so it will be a collector's item. I said, "No problem."
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LAKE: There you go. That is certainly comments -- that's exactly what GM management is hoping for. It's one of the big question marks.
If the consumers will stick by them, then they will be able to get through this stronger, meaner, leaner. They have signs all around saying "Backed by the American government," signs hanging up saying "GM Total Confidence." That's certainly the posture they're taking here today -- Kyra.
PHILLIPS: All right. Maggie Lake, thanks so much.
Well, few people know how the wheels came off better than CNN's Ali Velshi. He joins me now live from Toronto.
Ali, you know, now that we're dealing with the bankruptcy and talking about who owns GM at the moment, I mean, just looking forward, what does GM do now?
ALI VELSHI, CNN SR. BUSINESS CORRESPONDENT: Well, GM has got to figure out what it is going to be to the American consumer. Maggie was just talking about the customers sticking by GM, but the reality is people got really scared last year by those high gas prices. So, they're going to think twice.
That woman who's buying a Hummer is a rare breed. They're going to be thinking twice about what kind of cars they want to buy.
There's definitely going to be a push towards smaller, more fuel- efficient cars. And GM just doesn't have as much that's competitive in that stable. They make a Malibu which is a fantastic car, competes with the Camry for a lot less money. But at the lower end, what have they got? And can we have American cars at the smaller end that are as compelling as some of the trucks and the SUVs that we've got? So, that's going to be a big challenge.
Right now, what we are going to see -- you spoke to Sean Callebs at that plant in Spring Hill. They're going to be closing 12 more plants, idling another three across the country. Many of them concentrated in the Midwest. And they're going to be getting rid of Saturn and Saab and Hummer and Pontiac. So this is going to be a big challenge for GM.
In about 90 days or so, you should start seeing the new GM emerge. There is going to be a small car to be produced in the U.S. Sean was alluding to that, although I'm not sure it's going to go to Tennessee, but they are going to try and make a compelling product that gives them a full line.
So, you know, a lot of people, Kyra, I have heard on CNN saying today -- a lot of commentators saying Americans don't want the small cars, they want big cars. You can't push them into making fuel- efficient cars or selling them.
That's not the issue. The issue is General Motors and Ford have got to have a full line of vehicles so that if you want to stick with that brand, you can actually get something in every class. And that's what they're going to have to work on doing.
Ultimately, for all the financial engineering there is out there, Kyra, people need to have cars that they want to buy. And if they have those, then GM can come back.
PHILLIPS: All right. Ali Velshi, thanks so much.
Well, let's talk more about you. Maybe now is a good time to clean out your trunk, get out your checkbook, head to the dealership.
CNN Personal Finance Editor Gerri Willis says that GM's restart could mean some bargains on the lot.
Gerri, what's your advice to people who just want to get a GM car on the cheap? And obviously, if they get out there and start buying them, that's exactly what the CFO was saying to me, is they have got to sell those cars in order to keep the jobs alive.
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Well, that's absolutely right. And I have to tell you, the timing is right, Kyra.
(INAUDIBLE) GM cars at historic levels. Take a look at some of the deals out there.
There's a $4,500 back officer on Cadillac Escalade, a very popular model. The Chevy Tahoe, $7,000 back for 2009. Chevy Impala, up to $6,000 back, again for 2009. Plus, there's low-interest financing, and all this before dealer discounts, which, depending on where you live, the type of car you want and your dealer can be kind of a sliding scale of values.
And as we have mentioned, warranties shouldn't be a problem since both the company and Uncle Sam say they will stand behind these warranties -- Kyra.
PHILLIPS: So what's the best strategy for getting that rock- bottom deal on a GM car?
WILLIS: Well, start out by finding a dealership that is actually going out of business. The deal you get is more dependent on how the dealer is doing than how GM is doing. Dealerships going out of business will be more desperate to get their cars off the lot.
And look, don't -- call the dealership first, don't visit. If you're interested, you'll go a long way to getting a better deal if you figure out if they have the make and model that you want on the lot. And you won't get persuaded into something different that you don't want.
Know the incentives and the price the dealer paid for the vehicle. Twenty-five percent of vehicles are sold below what the dealer paid for it across the board, 17 percent of GM vehicles are sold at that level. This is according to a company called TrueCar.com.
Negotiate but don't bully. Don't go in offering half the vehicle's value, but do realize you have leverage here. Auto sales across the board are weak. You have some negotiating leverage.
Keep in mind you may want to wait a few weeks or even a few months before you go to these dealerships. That's when you'll get the best deal. As the availability of these cars diminish, though, you may have to contend with getting a car whose color or features you're not exactly thrilled by.
But it is a good time to start thinking about buying these cars. You're going to have the most leverage probably two, three, four months down the line -- Kyra.
PHILLIPS: All right Gerri Willis, thanks.
WILLIS: Thank you.
PHILLIPS: Well, vanished. An Air France jetliner with 228 people on board disappears over the Atlantic. We're going to look at what experts are saying may have been responsible.
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PHILLIPS: Well, "Likely victim of a huge catastrophe," those are the grim words of CEO of Air France after one of its jetliners disappeared over the Atlantic. Flight 447, with 228 people on board, was en route from Rio to Paris when it lost contact with ground controllers. Officials say the plane ran into severe thunderstorms.
The plane sent out an automatic message that it had suffered electrical problems. French President Nicolas Sarkozy has told relatives that there's little hope that anyone survived.
And for more on the weather factor in the disappearance of Air France Flight 447, let's bring in severe weather expert Chad Myers in the CNN Weather Center.
(WEATHER REPORT)
PHILLIPS: Well, a deadly shooting at an Army/Navy recruiting center in Little Rock, Arkansas. Police say that one soldier was killed, another wounded in the drive-by shooting. The wounded soldier's condition is serious but not life- threatening. One suspect is under arrest. The Army says the victims were not official recruiters but were helping attract others after just completing basic training.
Through the streets of Brooklyn, a moving memorial for the New York cop killed by a colleague. Friends, officers, even strangers turn out to support Omar Edwards' family.
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PHILLIPS: Well, respect for a life lost and support for a family forever changed. A convoy of trucks and motorcycles rolls through Brooklyn to Omar Edwards' home. A memorial for the off-duty NYPD officer killed by an undercover cop last week.
Edwards' family has said it feels sorry for the officer who fired the shots, for the mistake that he has to live with. Edwards was black. The other officer, white.
Meantime, the department says it will conduct a survey of undercover officers to get a handle on interactions with off-duty cops.
Seven months after voters went to the polls, the fate of a Senate seat for Minnesota lies with the state Supreme Court. Justices heard arguments today from attorneys for Republican Norm Coleman and Democrat Al Franken. A lower court declared Franken the winner by 312 votes.
Coleman is asking for previously rejected absentee ballots to be counted. If he loses, he could petition the U.S. Supreme Court, but it's uncertain that court would take the case.
Nevada has become the 17th state to recognize the relationships of gay and lesbian couples. The state legislature overturned the governor's veto of a bill extending most of the rights given to married couples to couples in domestic partnerships. The new law will take effect October 1st.
And supporters for and against California's ban on same-sex marriage held rallies in Fresno and San Diego over the weekend. Supporters of the ban describe their rally as a celebration of traditional marriage, but more than 3,000 supporters of same-sex marriage marched, promising to keep fighting for equality. Both events were in response to the California Supreme Court's decision to uphold Proposition 8.
The specter of race -- President Obama said he hoped the nation had moved beyond it with his election. Then he nominated Judge Sonia Sotomayor to the Supreme Court, and now some on the right are branding her a racist.
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PHILLIPS: Well, if you've ever wanted to own General Motors, congratulations. When the new GM comes out of bankruptcy -- and the White House hopes that's very few months from now -- U.S. taxpayers will own 60 percent of it. That's in return for another $30 billion from the government.
Court papers filed this morning in Manhattan showed the down and out automaker has $82 billion in assets and $172 billion in debt. The company is closing or idling several more factories and warehouses on top of those already announced. Some 20,000 more GM workers will lose their jobs.
The man that the White House chose to turn GM around is the newly installed CEO but longtime GM executive, Fritz Henderson. Today he spoke with CNN's Allan Chernoff.
Allan joins me live from the GM building in Manhattan with the headlines.
Allan, I can just imagine he had a lot to tell you.
ALLAN CHERNOFF, CNN SR. CORRESPONDENT: He certainly did, but he's very honest, Kyra. He's saying look, GM is drastically cutting its expenses, cutting its debt. And he says that will allow GM to turn a profit if we have U.S. auto sales over 10 million units a year. That's a bit higher than where we are right now. And GM also is going to have to hold on to most of its market share, and he says there's no guarantee this plan is going to be successful.
(BEGIN VIDEO CLIP)
FRITZ HENDERSON, PRESIDENT & CEO, GENERAL MOTORS: I think in terms of reducing the risk of the business, which is what breakeven point is about, it's about getting us to the point where we don't need so much volume to make money, such that when volume comes back, we can actually do much better.
(END VIDEO CLIP)
CHERNOFF: So, the bottom line for U.S. taxpayers, we have got to see GM become profitable. That new stock is going to have to rise if we are going to get our money back, going to get a return on our huge investment -- Kyra.
PHILLIPS: So, our $30 billion is basically fuel to keep GM running?
CHERNOFF: Kyra, in bankruptcy, it's called DIP financing, debtor in possession financing.
PHILLIPS: Got it.
CHERNOFF: And it is essential -- essentially, you can compare it to the dipstick; right? This measures the oil in the vehicle. Well, essentially, those billions coming from our pockets, that's the oil that's going to keep GM running.
The difference here is, of course, we can always change our fuel in the vehicle, but GM is saying this is a one-shot deal. No oil change for GM from here on in.
PHILLIPS: Well, talking more about GM, Allan, straight to the White House, Robert Gibbs.
Let's listen in.
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JAKE TAPPER, ABC NEWS: If General Motors wants to manufacture a car that your auto task force, whether it's Rattner or Deese or whoever, thinks is not going to be a car that's going to sell very well, are you going to stop General Motors from manufacturing that car?
ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: Well, Jake, we don't make those determinations. Those aren't -- Brian Deese isn't picking out Chevy Malibu's colors for next year.
TAPPER: I'm not talking about their colors for next year. You said that the point is the exit strategy is make the company viable so that GM is making cars that people want to buy. So are you going to be involved in...
GIBBS: No. We will be involved in corporate governance decisions such as setting up a board of directors that is going to make those business decisions based on how to get the company to profitability. That's what each company -- that's what the board of directors and the CEOs and the managers and the workers of every company want to be involved in, is a viable, strong, profitable company.
Look, now -- and I don't want to confuse this, so obviously Congress and the executive branch are involved in -- have always been involved in some decisions. And again, I'm not -- I don't want to commingle these issues, but I am separating, to some degree.
Two years ago, Congress had fuel mileage standards that go through model 2016. OK? Those have been established. I've seen reports that say well, you know, we may -- you know, the auto task force may decide that it's time to build, you know, these tiny little cars that go 40 miles an hour, blah, blah, blah.
Congress has always exercised its purview to set, for instance, corporate average fuel economy standards. That's, I know, not what you are talking about, but I am sort of separating some of those issues so we're not in the midst of confusing this.
QUESTION: I guess my point is, Fritz Henderson said today that the standard is going to be that they're going to try to build in for their new lines of cars and trucks ones that are outstanding that people want to buy, which came to a surprise to me that this was some new idea for an auto manufacturer, the idea they are trying to come up with something consumers actually would like to purchase.
What reason would you have for confidence that United Automakers, the people who have been running these companies, are going to be able to come up with something that Americans are going to want to buy, and, therefore, this $30 billion to $50 billion investment is going to pay off?
GIBBS: Well, look, I think you have seen over the course of several years an auto industry that has seen, regardless of economic conditions, a fairly dramatic decrease in its auto sales, not the least of which is because, you know, you've seen the reports. You're --
QUESTION: They kept on making Hummers and they kept on making junky cars that nobody wanted to buy.
GIBBS: Well, I think part of the restructuring, ultimately, is that the auto task force forced some decisions that I think, in many ways, some of these companies have been putting off for years.
You know, the auto companies have dropped brands. We have all seen that, you know, whereas some people, different companies are marketing only a few different models and using a fixed number of advertising dollars to push them, whereas some of the American auto companies have had 10 or 12 different models.
You've seen different companies that have the same car, literally the same car under different names in several different manufacturers, which hasn't made a lot of sense.
Obviously, I think again, one of the things that's been done is there's a fundamental restructuring --
QUESTION: You're proving my point. It's not like Fritz Henderson just walked in from another company. I mean, what makes you think that this investment's going to pay off? Just because they've learned the lesson now?
GIBBS: Well, I think, in many ways, their previous business model had them very locked in. I don't -- I think you have all seen the reports today of the serious amount of debt that GM was carrying, right?
When you're losing that kind of money, it's hard to undergo some fundamental restructuring without making some very fundamental decisions.
I think it's pretty clear that the companies have, in many instances, decided that they've got to produce different cars. Some of those are coming on in later model years.
There are things like the Chevy Volt that I think people believe, based on the high price of gas, based on consciousness about our dependence on foreign oil, can create different markets.
But I think that, fundamentally, what has happened is a company is free now to make fundamentally different decisions.
Yes, Ma'am?
QUESTION: Robert, have you designed the criteria for the board of directors?
GIBBS: Not that I know of, but I'm -- I can check for that. I don't know if there's been a strict delineation.
QUESTION: Are there some overriding principles for these people, because they will be key?
GIBBS: Right. No, absolutely. Look, I think you want -- you want a group of people that have been very successful in the businesses that they've run, that have some experience in running companies and understand what it means to undergo fundamental restructuring, to operate in a whole different world.
You know, again, if you look at, I used this analogy last week, you're going to have to make fundamentally different decisions. Thirty years ago, this was a company that employed probably ten times the number of workers it does right now.
Obviously, there's a mindset change that has to go on, and I think that's what they'll look for in a board of directors.
QUESTION: Do you think they have to come from the auto industry, per se?
GIBBS: Well, no, I think -- I don't think that's necessary, no. I think that having people that understand how to run a good business means running a good business regardless of what you're doing.
Yes, sir?
QUESTION: Following up on this, you said that the company is now free to make fundamentally different decisions. But I think the question is, what if they don't?
And, adding to that, the president has an obligation here. If he's spending $30 billion or $50 billion of taxpayer money, he has an obligation to make sure that money is well spent.
So if they make a decision he disagrees with on a line of cars or anything else, doesn't he have an obligation to taxpayers to make sure that decision is a good decision?
GIBBS: He has a strong obligation to ensure that there is a management structure in place that is making smart business decisions.
QUESTION: And if they're not?
GIBBS: Well, I think we covered an example about two months ago of the president and the auto task force thinking that GM might not have made business decisions that were so good in the past.
But again --
QUESTION: In other words --
GIBBS: But Chip, is the president going to thumb through engineering reports and each page of the annual report? No.
QUESTION: I'm asking, basic, fundamental --
GIBBS: I'm simplifying your question.
PHILLIPS: Robert Gibbs at the White House there talking GM.
But, let me tell you, no one on the planet knows GM better than the Greens of Lansing, Michigan. It's in their blood, it's their livelihood, it's their life.
We are talking three generations, Mike Green, his father Richard and Son Rollin, all join us live from Lansing. You guys have rolled with every punch that the industry has thrown at you. Did you ever think it would come to this -- Mike?
MIKE GREEN, PRESIDENT, UAW LOCAL 662: No, I didn't. Had no idea it would come to this.
PHILLIPS: Richard?
RICHARD GREEN, RETIRED GM WORKER: I have been worried for some time. Of course, everyone's kind of known what was coming on the road for the last three, four months. But I've been concerned for quite some time.
PHILLIPS: And, Rollin, you know, you were the last one there in the family to lose your position. You're still out of work. Did you see -- did you imagine it coming to this point?
ROLLIN GREEN, LAID OFF FROM GM: I didn't imagine it coming to this point. I mean, now that we're here, all we can do is do our best to get out.
PHILLIPS: Well, it's just incredible for how many years you guys have been with the company, and it surprised all three of you.
Richard, you have been there working for that company for the longest time out of the three guys. Take me back to the day when you told me "Gosh, Kyra, it used to be like slave labor." Tell our viewers that story about when you got the bloody nose. I'll never forget that one.
RI. GREEN: Well, I'm talking kind of ancient history. I have been out of the plant and all since 1993.
But back in 1953, when I went to work in the plant, the union wasn't that strong. My committeeman worked right next to me on the plant.
And one day I had a terrific bloody nose. The whole front of my shirt was covered with blood. And I asked my foreman to get off the job for a minute to see if I couldn't get the bloody nose stopped or maybe go to first aid.
We had some papers that we clean eye glasses with. He took a couple of those papers that we cleaned our eye glasses with, and I was working in a pit. He handed them to me in the pit and told me to stuff them up my nose and keep working.
And I did, because I wanted to keep my job. At that time, we had a union but it was not that strong, and my committeeman worked right there next to me. And he told me, he said, whatever you do, do not leave the job or you will be fired.
That's been gone for a long time, thank god. We've had a strong union and a good working ship of General Motors for the last 30 years, really. We have kind of worked in lockstep with the corporation, and I hope we can continue to do so.
PHILLIPS: Talk about putting your blood, sweat, and tears into that company, since 1953, Richard.
And Mike, you know, you picked up the reins after dad there. And you're a union leader now for the Lansing plant. When you hear about this bankruptcy and you listen to Obama's plan, I mean, what's your biggest concern right now? Is it the unemployment benefits, the shrinking paychecks?
M. GREEN: Well, it's pretty much all of it. You worry about your retirees -- they have already put their 30 to 40 years in -- to make sure they still have the things they need, their pension and their health care, because they worked for it along with the active people, keeping enough jobs there so people will have a job.
And your laid-off people, you know, getting them back to work.
So once we get through the bankruptcy, I think we did the things of the agreement. I think Cal and Ron did a good job on that to help everybody get through it. Everybody gave something up to make sure the company is going to survive to fight another day.
PHILLIPS: Interesting. And you keep such a positive attitude.
Rollin, you are the youngest of the guys there. Do you see a future in this business? Do you see yourself going back into the plant? Do you see GM surviving in the way that it used to be?
RO. GREEN: I do. It's going to take a little time. Nothing's going to change overnight. But, like I say, I think they're taking the steps in the right direction.
And hopefully, filing Chapter 11, they will come back more viable, more strong, and eventually be right back where we were a few years ago.
PHILLIPS: Final thought, Mike, any benefit to the government getting a huge equity stake here?
M. GREEN: Well, I think so. I mean, look at what GM, the UAW has invested in America, the tax base that they provide with all the jobs that they have. So, I mean, what's more patriotic to invest in America and American people that put out a good product and will continue to put out a good product? So I think it's probably one of the best investments they have ever made.
PHILLIPS: Final thought from you, Richard, we'll wrap this up. The CFO of GM said to me the future is the small car. Do you agree with that? Is that what is going to save this company?
RI. GREEN: Well, they have talked about the small car for some time. But I just purchased a new Chevrolet full-sized pickup. That's kind of what people still want.
But we've got to be, you know, we've got to have a small, more efficient car. And General Motors is working towards those ends with their electric cars and so on and so forth.
It's a forward-thinking company, and I believe General Motors will pull it out. As a matter of fact, I'm positive they will.
PHILLIPS: Richard, Mike, and Rollin, great to see you guys. It's always a pleasure.
M. GREEN: Thank you.
PHILLIPS: The breathtaking fall of General Motors has opened up the opportunity of a lifetime for its closest U.S. rival, Ford.
So how is Ford seizing the moment? Why don't we ask Susan Lisovicz, who's on the floor of the New York Stock Exchange. What do you think, Susan?
SUSAN LISOVICZ, CNN PRIMARY STOCK MARKET CORRESPONDENT: I think it's long been, Kyra, a Darwinian environment with this recession. And Ford sees a historic opportunity, and it's taking it in a big way.
Ford is basically the only of the big three U.S. automakers to not receive some assistance from the U.S. government, and it will soon become the only publicly traded company here on Wall Street.
So what Ford is doing Kyra, is upping production in this quarter, by 10,000 units. And in the third quarter, which is traditionally a slower period for the auto makers, when they shut down some of the factories, they will up it by even higher standards, by 41,000 units, Kyra. So they're seizing the day.
PHILLIPS: So what kind of vehicles is Ford making?
LISOVICZ: Well, I suppose, in some ways, you know, it's a bit of a surprise.
They're going after a crossover SUVs, but they're also going into their light trucks. The Ford F150 is the bestselling vehicle in the country.
But having said that, gas prices are going up. We have all noticed that. Crude here is trading higher by more than $2 at $68, basically, doubled from just the past couple months because there's a sense that not only is the U.S. economy improving, we are starting to see signs of optimism overseas as well.
We know the unemployment rate is going to continue to go higher. And, you know, big ticket items are not something that consumers are grabbing right now. So that is something of a challenge, something of a risk, I should say.
Having said that, Ford shares are up by about 8 percent. GM is trading, GM is trading today. It's a penny stock. It's been all over the map between 50 cents and $1.
And we are seeing a big rally. I should mention that, Kyra. I know you like looking at that new board. We will show it to you again. Yes, I know it's confusing a little bit, but it shows the percentage change along with the point gain. The DOW right now is up 228 points, the NASDAQ is seeing a nice rally as well.
There it is, Kyra.
PHILLIPS: A little more consumer/anchor friendly. Kind of threw me off when we tossed to it. That's not the big board I remember.
LISOVICZ: I was trying to get to you right away. Yes, it's not two points. It's nearly a 3 percent gain. So it's a super rally today.
PHILLIPS: You got the points, and then the percentage, makes sense. Thanks, Susan.
LISOVICZ: You're welcome.
PHILLIPS: Well, the plan to salvage another one of the big three getting the go ahead from a bankruptcy judge. Much of Chrysler can now be sold to a group led by Italian automaker Fiat. Some investors were trying to hold up the plan in court.
Thousands of jobs are at stake. Chrysler can now sell off eight factories and break agreements with nearly 800 dealerships.
The company could leave Chapter 11 around the end of the month.
(COMMERCIAL BREAK)
PHILLIPS: With all the goings-on at GM today, we haven't had much time to talk about the Supreme Court debate over Judge Sonia Sotomayor.
Rick Sanchez has been following that, and also been having some pretty interesting talks about the nomination and race, a lot of people saying people are blowing this out of proportion, read the whole speech. She's not a racist. Others saying she's a danger to the court.
RICK SANCHEZ, CNN ANCHOR: I'll tell you what, I haven't seen a story come along in quite awhile that has as much of a potential to create a rift between a particular political party and a demographic group in the United States.
The Republican Party in the last week, due to comments being made, interestingly enough not by any of the elected officials, but by people who are outside the party -- Tom Tancredo, Newt Gingrich, Rush Limbaugh, all saying such -- using such vehement language to describe this Supreme Court nominee and groups she's associated with, like La Raza, for example, that it's created serious tensions.
Then I took the question to Tom DeLay of Texas last Friday. Listen to what he told me.
(BEGIN VIDEO CLIP)
TOM DELAY, (R) FORMER HOUSE MAJORITY LEADER: This whole debate about Sotomayor's being Hispanic or Latina is racist in itself. I am disgusted that we are considering her nomination because she is Hispanic.
She has a worldview, she has a judicial temperament, she has a record, and that's what we ought to be looking at. It's racist in itself to have this debate.
SANCHEZ: You're not implying she was chosen by the president simply because she's Hispanic, or are you?
DELAY: I think it had something to do with it. He's been bragging about the fact he's appointing another woman, a Hispanic, and I think that's outrageous.
(END VIDEO CLIP)
SANCHEZ: What's interesting is that the conversation continues. By calling her a racist, by saying that the organization La Raza is akin or analogous to the KKK, the rhetoric has been heightened to such a point.
I don't know if you got a chance to watch all the Sunday morning talk shows this week, but almost in every Sunday morning talk show, including John King's, our own here, "State of the Union" --
PHILLIPS: Right. And you heard -- that's when everyone said I sort of misinterpreted. I read the whole entire speech. A lot of analysts were saying that.
SANCHEZ: The question is, Mitch McConnell tells John King over the weekend, "look, I'm not the word police."
But is it now -- is there a place for some Republicans to start saying to Rush Limbaugh -- and this is the fear they appear to have -- "Guys, cool it. Stop this. You're not doing us any favors."
It's an interesting debate.
By the way, on the political side, we are going to get a decision today on what may be the New Haven call.
You know what's interesting about that is when you look at her record, according to new information, something like 81 percent of the time she ruled against people who were filing immigration claims or claims that said they were somehow being prejudiced against or prejudiced against or discriminated against.
So that's an interesting part of the story as well.
The story's not over. There's still a lot to talk about here, a lot of fodder, as we say.
PHILLIPS: Oh, yes. You always have lots of fodder in your hour.
(LAUGHTER)
Thanks, Rick, I appreciate it.
SANCHEZ: Sure.
PHILLIPS: And by the way, coming this October, CNN will present "Latino in America" as Rick likes to say, Hispanic in America. That's the next debate. We will debate "Latino" versus "Hispanic." He's got an opinion about that, as well.
SANCHEZ: That's true.
PHILLIPS: It's a comprehensive look at how Latinos are changing America and how America is changing Latinos, and how that is reshaping politics, businesses, schools, churches, neighborhoods.
They are forcing a nation of immigrants to rediscover what it means to be American. "Latino in America" this October right here on CNN.
You have heard of birth control. One guy apparently hasn't. In fact, in his case, the births are out of control -- one dad, 21 kids, 11 moms.
And wait until you see what he says about birth control.
(COMMERCIAL BREAK)
PHILLIPS: If they gave out awards for the most fertile man in America, Desmond Hatchett of Knoxville, Tennessee should get it. Here's the numbers -- 21 kids, 11 moms, maybe more.
And here's a number that makes this problem even worse -- $7.25. Desmond has a minimum wage job. The state of Tennessee is having to step in and help.
So, Desmond, is 21 enough?
(BEGIN VIDEO CLIP)
QUESTION: Do you intend to keep having children? DESMOND HATCHETT, FATHER OF 21 KIDS: No.
QUESTION: You're done?
HATCHETT: Yes, I'm done. Hopefully I'm done.
QUESTION: What made you decide that?
HATCHETT: I didn't intend to have this many. It happened.
(END VIDEO CLIP)
PHILLIPS: The mothers of Hatchett's children are supposed to get anywhere from $25 to $309 a month. But when his paycheck is split up among them all, some women only get $1.98 a month.
The public, the paparazzi, the pressure. Singer Susan Boyle couldn't have imagined how her life was going to change. Well, we didn't imagine she would end up in a mental health facility either.
(COMMERCIAL BREAK)
PHILLIPS: Even her brief time on the world stage may have been a little too much. This story definitely tugs at your heart. In less than two months, Susan Boyle won millions of hearts, lost "Britain's Got Talent" show, and now has withdrawn from the public eye in a very unexpected way.
CNN's Zain Verjee is in London.
ZAIN VERJEE, CNN CORRESPONDENT: Kyra, oh, my goodness, it was a shocking defeat for Susan Boyle. We're learning now that she is suffering from exhaustion, that she is absolutely drained, and, upon doctors' orders, she is resting up at a clinic.
I spoke earlier to a gossip magazine editor here in London, who said she's going to be fine.
(BEGIN VIDEO CLIP)
EMMA DONNAN, ASSISTANT EDITOR, "STAR" MAGAZINE: It's quite shocking, on the one hand. But on the other, it's been an absolute roller coaster that she's gone through over the last eight weeks. Her life has completely changed.
VERJEE: Can she handle the international pressures now? We have seen how she's handled this pressure.
DONNAN: I think she will. I think she will probably take some careful handling and good advice. But I think judge Simon Cowell will make sure she has good people around here all the time.
(END VIDEO CLIP)
VERJEE: The statement from the TV company that makes Britain's got talent, Kyra, said this -- "Following Saturday night's show, Susan is exhausted and emotionally drained. She has been seen by her private GP, her doctor, who supports a decision to take a few days out for rest and recovery."
She went from being really loved one minute, Kyra, to just being slammed by people in the media, as well as by the public in the next minute. Many are saying it was really because of her temper tantrums that there was this huge backlash against her.
Still, she's hugely popular both here in the U.K. as well as in the United States, and she is going to make millions of dollars -- Kyra?
PHILLIPS: Zain Verjee, thanks so much.
That does it for us. We'll see you tomorrow.
Rick Sanchez takes it from here.
