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TARP Inspector Worries Bailout Money Being Wasted; Health Care Fight Heats Up; Soldier Taken by Taliban; Calfornia Reaches Budget Deal
Aired July 21, 2009 - 11:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
TONY HARRIS, CNN ANCHOR: Good morning, everyone. It is Tuesday, July 21st, and here are the faces of the stories driving the headlines today in the CNN NEWSROOM.
Neil Barofsky sounding the alarm about the possible ways to billions of your tax dollars. The man tracking the government's $700 billion bailout program testifying right now.
Plus, the search for Private First Class Bowe Bergdahl. Find out what the military is doing to locate the first U.S. soldier captured in Afghanistan.
And President Obama intensifying his fight for health care reform. The president speaks next hour. Our White House correspondent Suzanne Malveaux joining us live.
Good morning, everyone. I'm Tony Harris, and you are in the CNN NEWSROOM.
You know, it is your money, and you certainly have a right to know if it is being wasted. We are talking about the $700 billion aimed at prompting up banks, Wall Street firms and auto companies. The top cop in charge of tracking all of that dough says he can't get a straight answer about whether or how it is being spent.
Can that be true?
Live pictures now of the hearing going on right now on Capitol Hill. Neil Barofsky -- that is not Neil Barofsky -- is giving a House oversight panel an earful.
Congressional Correspondent Brianna Keilar is on Capitol Hill and Christine Romans is in New York.
And Brianna, let's start with you.
What is Neil Barofsky saying to lawmakers today?
BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: Well, Tony, he's telling them not only that he's worried some of this $700 billion could be wasted, and we might never know because there aren't these mechanisms in place to figure out where all of the money is going, but he also said something a little more alarming, that he's worried some of it could essentially be scammed from the government, and that he thinks there needs to be some firewalls in place to prevent things like insider trading.
Now, also, he was questioned, Tony, about that huge number that made such news overnight, that $27.3 trillion. That is a number that Neil Barofsky, who is right there -- you see him right there now -- he says this is the total amount of money that has been out there for the federal rescue of the financial system. So every federal dollar that has gone towards this he said is in that number, $23.7 trillion. It's a number that Department of Treasury officials hit back on, saying that it's inflated, and Barofsky responded to that just a short time ago.
(BEGIN VIDEO CLIP)
NEIL BAROFSKY, SPECIAL INSPECTOR GENERAL, TROUBLED ASSET RELIEF PROGRAM: If the numbers are inflated, then it was the government itself that inflated them, not us.
Secondly, as far as the suggestion that we are trying to shock and awe with this number, again, I think that we've made very clear in this report in black and white what this number means. We explain that this number involves programs that, yes, have terminated. We explain that there are -- that some of these numbers are collateralized, that there is collateral.
All that is set forth in black and white. But one thing that is very clear, the number is basically just the accumulation of what these 50 separate programs are and what the total amount of financial support that the government has committed to.
(END VIDEO CLIP)
KEILAR: Now, Barofsky has said that the Department of Treasury should be getting a lot of information from all of these banks that are getting bailout funds, your taxpayer dollars. He says there are some players like AIG, like Citigroup, who have gotten a whole lot of government money, and they have had to be accountable for it.
He says every bank that is getting bailout funds should be accountable. And furthermore, Tony, he said that just being this special investigator, that he -- or special inspector general, rather, that his people asked these banks for information, and without having any real power to get this information, he said they got it. So, there's no reason why Treasury shouldn't be able to get this information.
HARRIS: Well, Brianna, stand by, because I've got a couple of other questions. And you just made an interesting point about the powers of Barofsky, because my understanding is he's got pretty broad powers here to get some of these answers.
But, Christine Romans, this $23.7 trillion, can you help us figure this out?
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Sure. Well, we've been saying for months, Tony, that the efforts under way here are trillions of dollars. The $700 billion bailout is the money for the banking system. Beyond that, you have the FDIC guarantee of debt that these financial companies are issuing. You have lots of different other programs out there. From top to bottom, it's $23.7 trillion.
Now, some of those, as Barofsky pointed out, have already been reeled back in. For example, there was a big loan to JPMorgan Chase to take over the assets of Bear Stearns, right? Well, we got all that money back with $4 million in interest. In fact, taxpayers have had $6 billion in dividend payments, $200 million in interest payments, $70 billion sent back to the Treasury from the Troubled Asset Relief Program.
So, $23.7 trillion is how you measure it all up, but all of that money isn't at risk at the very same moment. So that's an important way to look at it.
HARRIS: Yes. That's such an easy number in this climate to politicize. And I think you would agree with that, Christine.
HARRIS: But in a case here -- let's think for a moment about the FDIC. It seems that every Friday we get a notice about banks that are closing. What we often don't report is that in many cases, those banks, the assets of those banks, are then sold off, in some cases to hedge funds and other groups.
That's part of the equation here, as well, right?
ROMANS: That's part of the equation, and there's so many moving parts. I mean, Tony...
HARRIS: No, that's a great point.
ROMANS: ... our viewers have got to know that the financial system, the banking system is big and complicated and important. Boring but important, I always say, the banking system. In some cases, not so boring.
But it's not just borrowing money, taking in deposits and lending it out. It's very, very dynamic.
And one thing about this, as well, is that Barofsky's team asked 364 banks what they're doing with the money, and 80 percent of those banks said that the money from TARP, the bank bailout money, had allowed them to lend money to customers.
HARRIS: Right. Right.
ROMANS: So, 80 percent said they've been -- among other things that they did with the money. But the banks have long said -- many of them told me, as well, and they've said in congressional testimony, we are lending money. We're just not lending as much as we used to because there's a financial crisis and we don't have as many creditworthy borrowers. HARRIS: Got you.
Well, let me take that up with Brianna.
Brianna, has anyone asked the question -- I'm assuming that they have -- as to, OK, you're not -- Treasury is not being forthcoming with what they know, what it knows about the way these banks -- do we know from Barofsky's own investigation how these financial institutions are spending the money?
KEILAR: Well, he said -- and I think we're going to get into a little bit more of that, Tony, as we go through here -- and I now that you mentioned that he has these broad powers. But what he was saying is that if Treasury were to have in place, hey, we're giving you money, so you need to do this, and cross your Ts and dot your Is and tell us what you're doing with it, he's saying the Treasury could have a lot of power to do this. And just in his investigation, he found these institutions to be pretty forthcoming.
I think we're going to get more into that, Tony. But he's saying that Treasury, he thinks, wouldn't really have difficulty doing that and that's not really an excuse.
HARRIS: Well, Christine, first of all, two questions. It seems to me, first of all, do we know what these banks are doing with this money? And why on earth wouldn't Treasury be asking?
ROMANS: We know what Citigroup, AIG and Bank of America are doing with that money, because Treasury is looking at every penny that's coming in and out, because Treasury is very involved in those banks. We don't know line for line what's happening at those other banks.
And Tony, a good point here is that Congress, in the law that it passed, didn't put these strings on there. I mean, remember that? Remember last fall how chaotic it was?
Congress didn't ask for all of this. So, ever since then, Treasury has been trying to get a hold of how much transparency and how much they should be asking for, and how to do that. And Congress has been asking for more and more accountability, but Congress didn't give it to them in the first place.
HARRIS: Oh my goodness.
All right, ladies. Appreciate it so much.
HARRIS: Christine Romans and Brianna Keilar on Capitol Hill.
And Christine, I think we're talking to you again next hour. Appreciate it. See you then.
This discussion of where the money is going certainly isn't over. The top cop over TARP is talking tough to the Obama administration, and Josh Levs has that in the next half-hour.
Some positive predictions about the economy from Federal Reserve chief Ben Bernanke. He is updating the House Financial Services Committee right now on Capitol Hill. Live pictures for you.
Bernanke says the Fed will be able to reel in its massive economic stimulus and prevent a spike in inflation when the nation's financial recovery takes hold. He is also pledging to keep the key bank lending rate at a record low for an extended period. Economists predict rates will stay near zero through the rest of this year.
The nation's leading lender to small businesses says it may still have to file for bankruptcy. That's despite a deal CIT Group reached just yesterday with its bondholders. They agreed to give CIT a $3 billion loan so the company would have time to restructure its existing debts, but CIT now says that the money might not be enough because it needs to pay off about $7 billion in debt maturing over the next year.
The health care fight heats up. President Obama pushing back against Republican critics of his reform plans, and he is pushing Democrats to move the legislation forward. Mr. Obama meets with key House Democrats today, and he is expected to make brief remarks on health care next hour.
Yesterday, he accused Republicans of putting politics ahead of policy.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Just the other day, one Republican senator said -- and I'm quoting him now -- "If we're able to stop Obama on this, it will be his Waterloo. It will break him."
Think about that. This isn't about me. This isn't about politics. This is about a health care system that is breaking America's families, breaking America's businesses, and breaking America's economy.
(END VIDEO CLIP)
HARRIS: House Republicans say the bill under consideration now just doesn't cut it.
(BEGIN VIDEO CLIP)
REP. ERIC CANTOR (R-VA), MINORITY WHIP: What we're seeing currently is a bipartisan majority has formed against the current proposal. There's no question, we are at a crossroads as far as health care reform is concerned in this Congress.
(END VIDEO CLIP)
HARRIS: Well, that means we're getting close here to something. Maybe nothing. All right. White House correspondent Suzanne Malveaux joining us live.
Suzanne, the president still has a pretty tough sell. And yesterday we were talking about the discussion about whether he's too out in front on this, but it looks like all his chips are in on this.
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Absolutely, Tony. Think about it, we're going to see the president again today in the Rose Garden in about an hour or so. This is a daily occurrence.
I remember covering President Bush. He was trying to privatize Social Security. That didn't necessarily work for him when they put him out there and the drumbeat, the daily drumbeat, whether he was out on these town hall meetings or at the White House trying to push this. So, it's still far from uncertain to see whether or not this is really going to work. But White House aides believe, get him out there, get him out there every day, very publicly, to put more pressure on members of Congress, to bring this attention to the American people that this is a very important issue.
Now, he had an interview on the "Today" show this morning, and he was asked about the fact that, yes, is this a political thing? He says, no, it's not politics, that this is not some sort of Washington sport. He's very much invested in this.
And he did acknowledge the Congressional Budget Office, the nonpartisan group, what they said about the plans that are on the table, that they do not lower the cost of health care, that they actually will contribute to the federal deficit. What do you do about these plans? He was asked to address that. He says, yes, I know what the CBO is talking about. We still have a ways to go.
I want you to take a listen.
(BEGIN VIDEO CLIP)
OBAMA: I know exactly what they're saying, and what they're saying is, is that the cost savings that are in those bills right now, some of them may actually work, but they're not enough to offset the additional costs of bringing in 46 million new people.
(END VIDEO CLIP)
MALVEAUX: So, Tony, they're not yet there. They're still negotiating. The president acknowledging that they're not yet there.
One of the ideas, obviously, at least on the House side they're talking about, is consider a surtax on those who make $280,000 a year or plus. He was asked whether or not he supported that. He said anybody making $250,000 or less, he does not want to see them taxed, add on to their taxes. But he seemed to open the door, the possibility of those making more than that, that they would be taxed in some kind of way because they haven't found the savings that they need to compensate for those people who they say are going to get health care insurance. So, obviously, still a lot of wrangling going on behind the scenes. And, of course, that public relations campaign very public, very consistent. We'll see him in about an hour -- Tony.
HARRIS: Yes. And if you can put the politics aside -- I know it's difficult -- it sounds like we are really now starting to get to the core of this thing, how you pay for it and the possible options.
Suzanne, appreciate it. See you next hour. Thank you.
And we expect to hear from the president on health care in a little over an hour. He is scheduled to make brief remarks around 12:15 Eastern Time.
Live coverage right here in the CNN NEWSROOM.
And President Obama holds a prime-time news conference tomorrow night. Tune in to CNN at 7:00 eastern for "MOMENT OF TRUTH: COUNTDOWN TO BLACK IN AMERICA 2." That is followed by live coverage of the president's prime-time news conference at 8:00 and an all new "BLACK IN AMERICA 2" beginning at 9:00 Eastern Time.
Reforming the current health care system, I think we can all agree, will require changes. Here's the questions for you today. What are you willing to give up? What are you willing to give up to help the millions of underinsured?
Are you willing to pay higher taxes, switch to a government- sponsored plan, have less generous coverage? What are you willing to give up?
We want to hear from you. Just go to our blog, CNN.com/Tony, and leave us a comment.
An American soldier captured by the Taliban -- what the military is doing to find him.
HARRIS: So, an all-out search is under way right now in Afghanistan for an American soldier kidnapped by the Taliban and shown in a video released just a couple of days ago.
CNN Pentagon correspondent Barbara Starr has the latest.
BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): Private First Class Bowe Bergdahl, held captive by the Taliban for three weeks, clearly in fear, missing his family.
PFC. BOWE ROBERT BERGDAHL, U.S. ARMY: I miss them every day that I'm gone. I miss them, and I'm afraid that I might never see them again.
ROBERT GATES, U.S. SECRETARY OF DEFENSE: Our commanders are sparing no effort to find this young soldier. And I also would say my personal reaction was one of disgust at the exploitation of this young man.
STARR: Hundreds of troops have fanned out across Afghanistan's eastern Paktika since Bergdahl was captured June 30th. U.S. military officials will confirm few details of the urgent hunt, but have acknowledged they have cordoned off areas, conducted searches and are using drones to watch overhead for any signs of the 23-year-old soldier being moved. The U.S. intelligence community also continues to monitor cell phone traffic in the region, according to officials.
Admiral Mike Mullen, chairman of the Joint Chiefs of Staff, just returned from the region.
ADM. MICHAEL MULLEN, CHAIRMAN, JOINT CHIEFS OF STAFF: Having been with the forces, in fact, who are conducting the operations to recover him or to find him, is -- they are extensive, vast. They're on it 24/7.
STARR: The U.S. has been distributing these pamphlets in the region, seeking information. One reading, "If you do not release the U.S. soldier, then you will be hunted." But the biggest clues may come from this 28-minute tape.
KEN ROBINSON, FORMER MILITARY INTELLIGENCE OFFICER: We teach soldiers that if they can get on video they should, because it gives the United States proof of life.
STARR: The U.S. military is now analyzing each frame for clues about who is holding Bergdahl and where he is being held.
HARRIS: Barbara Starr live at the Pentagon, with us now.
And Barbara, I'm curious, what kind of training do soldiers get in order to prepare for something like this?
STARR: Well, you know, Tony, there's different levels of training, depending on what your job is. If you are a pilot, if you are a member of a Special Operations team, commando teams, you get very intensive training. It is just like the movies. They teach you to evade capture, how to survive if you are tortured, how to really handle yourself in captivity, because those kinds of troops are at very high risk.
The regular infantry guys really aren't at that high a risk. They all work together in the field, they're in large groups. It's not expected, really, that any of them would be taken into captivity. So, their training, very basic -- how to conduct yourself, how to obey the code of conduct, how to not say anything that would put your fellow soldiers at risk, and how to keep your eye open if there is an opportunity to escape -- Tony. HARRIS: OK. Barbara Starr at the Pentagon for us.
Barbara, thank you.
HARRIS: This is the deadliest month for U.S. forces in Afghanistan. Yesterday, a roadside bomb killed four more American troops, sending the death toll to a record. Already this month, 30 Americans have died fighting the war in Afghanistan.
A Georgia community honors one of its own killed in Afghanistan. With the death of Sergeant Brock Chavers in a roadside bomb explosion, the war hit home for the community, as it has in towns and cities across America.
Hundreds turned out for Sergeant Chavers's funeral this past weekend in Statesboro, Georgia. These pictures are from Scott Bryant of the "Statesboro Herald."
I've got to tell you, our entire show team was moved by these photos, the outpouring of support for this man, his family, his cause and his country. Family, friends and complete strangers packed the church, lined the streets to honor the fallen soldier. Many just wanted to show their appreciation for a young man who made the ultimate sacrifice for his community and his country.
HARRIS: California has a tentative budget deal, and it doesn't raise taxes. Really?
All right. Dan Simon in is San Francisco.
Dan, how do you close a $20 billion-plus budget deficit without raising taxes? Are all the state offices closing?
DAN SIMON, CNN CORRESPONDENT: Well, good question, Tony, but, you know, this is being characterized as a significant retooling of state government.
As you said, they're not going to raise taxes with this new budget. They are making substantial cuts.
We're talking about $15 billion in cuts. Obviously, a lot of people are going to be affected by this.
Who is going to be affected the most? Well, when you look at the system, you're talking about the education system. They're going to lose $9 billion, $6 billion from public education, $3 billion from the university system.
It's really unclear how they're going to manage that shortfall, if it's going to be fewer classes or smaller classes or less faculty. That really remains to be seen. As they say, the devil is always in the details. Another program taking a huge hit is Medi-Cal. That's California's Medicaid program that provides health coverage to about six million Californians, families, the disabled, the elderly -- a $1.3 billion cut to Medi-Cal. So, it's clear when you look at that number, that some people, no doubt, will lose their health coverage.
This deal was struck yesterday evening, and Governor Schwarzenegger came out with his fellow lawmakers and tried to put his best face on.
Let's listen to what the governor had to say.
(BEGIN VIDEO CLIP)
GOV. ARNOLD SCHWARZENEGGER (R), CALIFORNIA: This is a budget that will have no tax increases, a budget that is cutting spending. We deal with the entire $26 billion deficit. It's around $15 (ph) billion in cuts that we're making.
Very happy about protecting education, that education gets fully refunded. We're also very happy that in this budget we make government more efficient. And also, we're cutting the waste, fraud and abuse in some of the programs. And, so, all around, I think this is a really, really great accomplishment.
(END VIDEO CLIP)
SIMON: Yes, the governor says he's happy that he is saving education. What he is referring to is that eventually, when the state economy rebounds, the education cuts will go back to where they were, Tony -- $9 billion will be refunded to education.
Not sure if you can call this good news, but Schwarzenegger at one point had proposed totally cutting off the state's welfare program. It will remain largely in tact. And also, there had been a lot of speculation, a lot of concern that many state parks would close, but most of those will remain open -- Tony.
HARRIS: Hey, Dan, you know, we had a lot of fun with the IOUs. Not fun if you're receiving one out there in California.
What is the status of those IOUs?
SIMON: Well, a lot of vendors were getting IOUs, and people who should have been getting tax refunds. If you look at the numbers here, 153,000 IOUs went out worth $682 million. For the time being, those IOUs will continue. The state comptroller, John Chiang, said he's going to be evaluating it.
The other thing that we're waiting to see is what's going to happen with all the furloughs. Schwarzenegger ordered that state workers take three furlough days each month, but what we're being told right now is that those furloughs are going to continue for the foreseeable future. And, of course, state workers not happy about that at all.
All right. Dan Simon for us in San Francisco.
Dan, good to see you. Thank you, sir.
Let's talk about the TARP. And the watchdog over TARP, Neil Barofsky, is taking on the Obama administration, starting with a 260- page report that really rips into the Treasury Department.
Josh is looking through the report.
You have it, Josh?
JOSH LEVS, CNN CORRESPONDENT: I have it.
HARRIS: I mean, 260 pages.
HARRIS: And the question is, you know, why hasn't Treasury been more forthcoming with information about how the money is being spent?
LEVS: That's what he really gets at. You know, what we could do, we could just drop all our other stories today and I could read the 260 pages. Would that be good TV?
LEVS: Look, this is the thing, where basically it takes a team, right, to breeze through this. But this is what we've been doing, really going through it, and I want you to see some of the key parts of it. And let's get straight to it.
I pulled out a quote for you that I think helps summarize really what we're talking about here. Let's go straight to it. This is what he's saying: "Taxpayers are not being told what most of the TARP recipients are doing with their money, have still not been told how much their substantial investments are worth, and will not be told the full details of how their money is being invested."
Let me go to a second quote here for you, just to show you how strong he is being in what he's saying. He's saying, Tony, "the very credibility of TARP will depend on whether Treasury will commit to operate TARP with the highest degree of transparency possible."
And what he does is, he goes on to say, look, I've given a bunch of recommendations saying, this is what you should do. You should provide all this information. He feels that Treasury's just not doing it. Let me show you one of his recommendations, which pretty much is the main one that gets to it. He's saying the first one that he wants to see, require all TARP recipients to report on the actual use of TARP funds and what they would not have been able to do otherwise.
So, what we're seeing in Congress today, what we're seeing in this massive report that's up online is him saying, look, there are basics about what's happening with all this money... HARRIS: Right, right, right.
LEVS: ... that I want from Treasury, and it's just not being given.
HARRIS: Can you give me an audit? Can you give me a receipt or can you give me something here?
LEVS: This is no holds barred. This is powerful stuff.
HARRIS: Yes, it is. And it doesn't seem like too much to ask for. Any response from the Treasury Department to the report from Barofsky?
LEVS: Yes, I got off the phone with them. Here's what they did. They sent me a copy of a letter that is actually included in this, which is their response. And I have a quote for you here. And I want to help everyone understand what Treasury is saying. Let's go right to it.
This is their argument here. They're saying, "It's not possible to say that the investment of TARP dollars resulted in particular activities by the recipient." What they're saying, Tony, is this concept of "show us where the TARP money's going" doesn't make sense. Because when you give banks a bunch of money, banks are spending lots of money in different places. How do you know exactly where the TARP money is?
And they also say this. I want to be fair. Let's toss in one more quote from Treasury. They are saying, look, "we will seek to collect and provide useful information that can help determine if we are making progress toward restoring financial stability."
HARRIS: What am I missing here, Josh? That doesn't make any sense to me.
LEVS: OK, here's what they're saying. The basic idea here is, they're saying, look, we do believe that it would be good to follow what happens with the money, but their argument is banks have other money, too. They can't say, I'm spending TARP money here and other money over here. So, that's what happened to the TARP money. They just want these broad looks (INAUDIBLE).
HARRIS: What is it -- does the TARP money just go into a big pot, and it just goes wherever it goes? That just -- all right. OK.
LEVS: Well, he agrees with you. I mean, the special inspector general is saying, look, you know what, I turned to hundreds of banks, and they told me, here's where the TARP money's going. So he's saying, look, you're wrong. You can follow this money.
HARRIS: Just follow the money. Just tell us where the money went. Come on. All right, Josh.
LEVS: Everyone wants to know, yes.
HARRIS: Show me the money.
LEVS: I was waiting for one of us to say it, and I knew it wasn't going to be me.
HARRIS: You knew it would be me. Right. All right, thanks, Josh.
LEVS: Thanks, Tony.
HARRIS: The economy, it is the big concern on Wall Street this week. The Fed chief is talking about it, and so is corporate America. So, where do we stand, and what do today's earnings reports show? Susan Lisovicz is at the New York Stock Exchange with details.
And Susan, where do you want to start here, with the earnings reports or with the Fed chief?
SUSAN LISOVICZ, CNN CORRESPONDENT: Well, we ought to talk about corporate earnings because there are a whole lot of them, Tony. I mean, I would call this Wall Street's version of Super Tuesday. We have dozens of big companies reporting, including five of the Dow 30 companies.
Now, you have to remember, quarterly earnings, you're comparing the second quarter of '09 to the second quarter of '08. Well, the second quarter of '08 was so much better than what we've seen this year. The unemployment rate, for instance, was 5.6 percent compared to 9.5 percent now.
So, what we're seeing is large declines year over year in sales, and oftentimes you're seeing profits driven by things such as cost cutting. But the companies prepared us for that, so that's why we'll say a lot of companies have beaten the estimates. Case in point, Caterpillar. Caterpillars makes bulldozers, tractors, backhoes. Its quarterly profits tumbled 66 percent. That was better than the Street estimated. Still made a whole lot of money.
But here's the catch. Cat raised its outlook for the year. Says credit markets are improving. It's starting to see the effects of stimulus around the world. So, think of those shovel-ready projects...
LISOVICZ: ... actually are up 8 percent. Yes, Tony.
HARRIS: No, I'm just saying, that's glass half full for a change. I like that. So, all right, so there's a market, obviously, for these tractors. Good, good, good, good, good. But you know, the airlines, that is still a troubled sector and, look, the airlines are having a difficult time selling tickets right now, Susan.
LISOVICZ: Yes, understandably because of that 9.5 percent unemployment rate. Case in point, Continental Airlines. It lost over $200 million in the last three months. That was worse than the Street expected. It missed the estimates, and it plans to make up for it, how? By cutting its workforce, 1,700 jobs, and nickel-diming us, those of us who are flying. It's going to raise the additional -- or raise the first-bag fee from $15 to $20 if you do it at the airport. So, do it online.
And you should actually book your fare online because it's raising the phone reservation by another $5. So, and it says it's going to look for more measures, additional measures to sort of boost its revenue. So, think of other creative ways to nickel and dime us, unfortunately.
HARRIS: That's just wonderful. If you want us to buy tickets, there's the remedy, raise the price on everything.
LISOVICZ: That's right. We're thinking of, like, maybe reclining your chair is going to come at a cost, or plugging in your iPod. I mean, where are we going with this?
HARRIS: This is nuts. All right, I've got to get a quick market check from you. How are the numbers?
LISOVICZ: Dow's up seventh day in a row. Nasdaq's giving back a little. But the Nasdaq's was riding a nine-session win streak, Tony.
HARRIS: All right, Susan, see you next hour, thank you.
LISOVICZ: You're welcome.
HARRIS: And check out our special report. "AMERICA'S MONEY CRISIS" is at CNNmoney.com. We're going to take a quick break. We're back. More CNN NEWSROOM in a moment.
HARRIS: Taxing the wealthy to pay for health care reform. It is an idea that is really under fire from Republicans and some Democrats, to be fair about it. Senior congressional correspondent Dana Bash live from Capitol Hill. And Dana, before I get to my frustration on all of this, what's going on right now with the health care tax plan?
DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Well, with regard to negotiations, which are ongoing, they are really reaching kind of a high-decibel level and they're obviously going on behind closed doors as we speak inside the Senate Finance Committee. And I can tell you that that whole idea of a surtax to pay for this very costly reform, that's not going to fly in the Senate. So, that is, really, Tony, what they've been grappling with, this group of bipartisan negotiators.
And you remember last week and even the week before, it became pretty clear that because of opposition from the president and some Democrats, the key way that they had in their plan to pay for reform, and that would have been to tax for the first time, tax employer-based benefits, that's no longer on the table. So, they're actually, we're told, looking at another alternative to that. It's kind of interesting. This is a proposal now out there by Senator John Kerry of Massachusetts. And his idea would be to, instead of tax the employers, employer-based benefits, to tax the insurance companies and the insurance companies, specifically the plans that are the most costly, the so-called Cadillac plans. So, that is something, we're told, that is being discussed as an alternative way, not just to pay for reform, but also to reach that other very important goal of the president, and that is to reduce medical costs -- Tony.
HARRIS: Oh, that's interesting. Possibly taxing the insurance companies.
HARRIS: Yes, yes, possibly. OK, a tougher sale is happening in the House, where we have some Democrats who aren't necessarily on board, is that correct?
BASH: That's right. Not on board, particularly with this issue of a surcharge or a tax on the wealthiest individuals in this country to pay for health reform. And it is definitely not flying with conservative Democrats, and it is causing big problems. I talked to one of those conservative Democrats and actually a freshman from the state of Virginia, who explained why he thinks it's a bad idea what his party over in the House is trying to do.
(BEGIN VIDEO CLIP)
REP. GERRY CONNOLLY (D), VIRGINIA: I think it's premature to be talking about a tax increase when we haven't identified, in my opinion, every saving to be had. And then, secondly, the way the surcharge was described, it would have an impact not only on people over a certain income level. It would also have an impact on a lot of small businesses. So, at the very least, I want to see that threshold raised.
(END VIDEO CLIP)
BASH: Impact on small businesses, that is what we're hearing, again, not just from Republicans. That was a Democrat there. And that is why the House speaker raised the idea of a compromise. And that would be to raise the threshold, if you will, and say that nobody, at least no families, making less than a million dollars a year would be taxed in order to pay for health benefits.
But I can tell you, that's there -- that's just one camp. There is another camp of conservative so-called blue-dog Democrats in the president's own party who are basically holding up a vote in a very key committee, and the president is going to meet with those so-called blue dog conservative Democrats today. Their big issue is the fact that they don't think that their party's plan does enough to reduce medical costs. And so, they say it's not really worth reforming if we don't do that.
HARRIS: Yes. OK, Dana. There's so many questions, but I think we've got a little bit of time to sort through all of it. Dana Bash for us on Capitol Hill. Thanks, Dana.
BASH: Thanks, Tony.
HARRIS: We expect to hear from President Obama on health care in about 30 -- yes, in about 30 minutes. He is scheduled to make brief remarks about 12:15 Eastern time. Live coverage right here on CNN.
President Obama holds a prime-time news conference tomorrow night. Tune in to CNN at 7:00 Eastern for "MOMENT OF TRUTH: COUNTDOWN TO BLACK IN AMERICA 2." That is followed by live coverage of the president's prime-time news conference at 8:00 p.m. Eastern and an all-new "BLACK IN AMERICA 2" beginning at 9:00.
OK, reforming the current health care system will require change. Everyone understands that. So, we're asking you, what are you willing to give up to help the millions of un- and underinsured. What are you willing to give up? And please be specific. Are you willing to pay higher taxes? You willing to switch to a government-sponsored plan and have a less generous plan?
We want to hear from you. Just go to our blog, CNN.com/tony and leave us a comment.
What would you be willing to give up for everyone so that they can be insured? Our senior medical correspondent Elizabeth Cohen takes a look at some of the possibilities in the next hour of CNN NEWSROOM. .
Plus, these fighter jets right here designed in the 1980s have never flown in Iraq or Afghanistan. So, why is the Senate considering spending almost $2 billion to buy more? We are watching the fight over the F-22s.
HARRIS: Hey, did I see Kyra there? Was that Kyra in the newsroom? CNN NEWSROOM with Kyra Phillips at 1:00 p.m. Eastern time today.
So, no votes on Supreme Court nominee Sonia Sotomayor, at least not today. Republicans succeeded in getting a delay of today's planned vote. It is pushed to next Tuesday. Democrats had hoped for a quick vote following last week's confirmation hearings. A full Senate vote is still expected before Congress goes on recess next month.
ROB MARCIANO, AMS METEOROLOGIST: Hey, man.
HARRIS: You're back!
MARCIANO: What's up?
HARRIS: How you doing, man?
MARCIANO: I'm doing great. I had a vacation. I haven't had a long one of those in a while.
HARRIS: You had a what?
MARCIANO: A vacation, no work...
HARIS: I don't even know how to spell one of those things.
MARCIANO: ... put the, you know, BlackBerry down and just, you know...
HARRIS: You did?
MARCIANO: Yes. It was nice.
HARRIS: Did you unplug? Really?
MARCIANO: I totally unplugged. Well, I didn't have service, and I certainly wasn't going to pay extra for it, you know. (INAUDIBLE)
HARRIS: Hey, I would tell you that I missed you, but you'd blog it or something, and then that would become -- but it's good to see you, Doc. Good to see you.
MARCIANO: Hey listen, just because, you know, got the post- vacation blues, it's kind of reaching celestially here. What you're looking at is an image from a NASA telescope. They've got one of those on the top of the mountain there in Hawaii.
And this is Jupiter. I know it's not -- you don't see the colors that you normally see, but this guy right here is a disruption in the atmosphere, and they've got a lot of atmosphere in Jupiter. It's the biggest one in the solar system. They think, like, a comet or something hit that. So, I thought I'd show you that. It's pretty cool.
HARRIS: Nice, man, nice.
MARCIANO: A little bit closer to home, still celestially though, we've got a total lunar -- total solar eclipse, eclipse of the sun happening tonight. And because in July the sun's so far away and the moon happens to be pretty close, it's going to be longer than what we'll see in, like, 100 years. So, this is the place you're going to see it, where it goes from yellow to black. And, well, you may notice this is nowhere near the U.S.
MARCIANO: That's the unfortunate part of that. We won't be able to see it. Maybe if you're in Hawaii, maybe a little sliver of it. But folks who are in Asia will see it. Millions of people going to see this thing. And it's like Shanghai, weather may not cooperate. That may be the down part of that.
Anyway, good to see you, Tony.
HARRIS: Yes, man. MARCIANO: Good to be back from vacation, and we'll be back here tomorrow.
HARRIS: Stick around a while. Glad you got rested and unplugged. Unplugging, that's the key part of this deal, all right? Good to see you.
MARCIANO: See you tomorrow.
HARRIS: Take care, Rob.
Fewer black men are getting married. It seems the trend is to just live together. What one community is doing to get more black men to say "I do."
HARRIS: Marriage in the black community is on a 40-year downward spiral. Many say the trend is seriously weakening black America, both socially and economically. That has prompted one woman to take on this crisis head-on. Her fight becoming a national crusade.
CNN special correspondent Soledad O'Brien reports.
UNIDENTIFIED FEMALE: We want the children to see the power and devotion of marriage.
SOLEDAD O'BRIEN, CNN SPECIAL CORRESPONDENT (voice-over): Joyful, celebrations of love.
UNIDENTIFIED MALE: Thank you, God. Hand clap and praise.
O'BRIEN: Leaps of faith and vows of commitment renewed. Scenes all too rare in the black community.
UNIDENTIFIED MALE: I'm going to ask all of our married couples to please stand.
O'BRIEN: That's exactly why Nisa Muhammad created National Black Marriage Day, which promotes the benefits of saying "I do."
UNIDENTIFIED MALE: When two interlocking forces...
AUDIENCE: When two interlocking forces...
UNIDENTIFIED MALE: ... are joined together...
AUDIENCE: ... are joined together...
UNIDENTIFIED MALE: ... they cannot...
AUDIENCE: ... they cannot...
UNIDENTIFIED MALE: ... be separated. AUDIENCE: ... be separated.
O'BRIEN (on camera): Why do you think marriage has become such a big problem in the black community?
NISA MUHAMMAD, BLACK MARRIAGE ADVOCATE: I think it's really become a problem because a lot of people have bought into the hype that marriage doesn't matter, that marriage is just a piece of paper, that you can get the same thing, the same benefits or privileges by just living together, because living together is becoming more popular. And I think that's a false perception.
O'BRIEN (voice-over): Nisa's Wedded Bliss Foundation has been dedicated to saving black marriages across the country since 2006. In that time, Nisa says she's helped more than 1,500 couples in crisis, and she boasts a success rate of nearly 90 percent.
Remarkable, when you consider marriages have been in free-fall in the black community for decades. In 1963, more than 60 percent of black households were headed by married couples. Today, it's less than half that.
MUHAMMAD: We have the lowest marriage rates, the highest out-of- wedlock childbirth rates. And it's like when white America has a cold, black America has pneumonia.
O'BRIEN: It's an epidemic Nisa is battling with her marriage boot camp. She and teaching partner Jamiel Muhammad (ph) host an eight-week course called Basic Training for Couples.
MUHAMMAD: A lot of us have grown up seeing bad marriages or negative marriages. And you could say, well, I really don't want my marriage to be like that. I want to it be different. But a lot of our children today grow up, and they don't see any marriages.
O'BRIEN: It's free and open to any struggling couple. Those considering marriage, those brand-new to marriage and those close to divorce, like Tina and James Barnes. They've turned to Nisa as their last resort.
JAMES BARNES, TRYING TO SAVE MARRIAGE: It's gotten to the point where I've just thrown my hands up. If things don't change, I can't continue to be in this environment.
TINA BARNES, TRYING TO SAVE MARRIAGE: It would be hard to say this a month ago, but I can honestly say it now, that I'm not willing to settle for a husband that I know loves me but is afraid to show it or can't talk to me.
O'BRIEN: For Tina and James, it's a last chance and the beginning of a long and uncertain journey.
HARRIS: Don't miss the premiere of the first of two nights of an all-new "BLACK IN AMERICA" event, "BLACK IN AMERICA 2," starting tomorrow night at 9:00 Eastern, right here on CNN.