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American Morning
Bill Clinton Heads to Pyongyang; Senate to Debate Health Care Reform, Cash for Clunkers
Aired August 04, 2009 - 06:58 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KIRAN CHETRY, CNN ANCHOR: Meanwhile, we're coming up on the top of the hour. Welcome once again to AMERICAN MORNING on this Tuesday, August 4. I'm Kiran Chetry.
JOHN ROBERTS, CNN ANCHOR: Good morning to you. I'm John Roberts. Thanks for being with us. A really busy morning on tap, and here's what's on the agenda, the big stories that we'll be breaking down for you in the next 15 minutes.
First, breaking news this morning. Former President Bill Clinton on the ground in North Korea. He's hoping to come back with the two U.S. journalists who were detained back in March. We've got the global resources of CNN on top of every new development in this story.
CHETRY: And for the first time, officials in Iran confirming the country is holding three Americans, saying that they were arrested for entering the country illegally. Reports from Iran's state-run media also casting doubt about whether the three are hikers who lost their way. Secretary of State Hillary Clinton is calling on Iran to release them, quote, "as quickly as possible."
ROBERTS: Plus, the Dow is set to open this morning at a nine- month high. Pushing the markets up, better than expected results from Detroit and in the country's manufacturing sector. The Dow closed up 115 points on Monday. It's current level, 9287.
CHETRY: We begin with breaking news this hour. Right now, former President Bill Clinton is in North Korea, trying to negotiate the release of two U.S. journalists. Clinton arrived just a few hours ago in an unmarked jet. These are some of the pictures from that arrival. He was greeted by two of Pyongyang's top officials, then given a bouquet of flowers by a young girl. Clinton is there, even though no formal record of exactly what's happening is on the books, to ostensibly bring back U.S. journalists Laura Ling and Euna Lee.
Our correspondents across the globe are bringing you this story in a way that only CNN can. We have our own foreign affairs correspondent Jill Dougherty live in Washington with us first for more on the situation.
Some have said, is this just to try to secure the release of hostages, or will North Korea's nuclear ambitions come up? What do we know about what may or may not be happening in those talks?
JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Kiran, as you know, at the airport, one of the people who greeted him was their chief nuclear negotiator, which is quite interesting.
This whole thing is being played out -- it's a gamble, and it's being played out with extraordinary diplomatic and personal stakes. Look at it. You have the fate of the two journalists, who, after all, were sentenced to 12 years of hard labor.
So the question is, will they get out? Will Bill Clinton have them on the plane coming back to the United States?
Then you have this standoff over the nuclear program of North Korea. The administration has tried to keep that separate, two different tracks. But certainly that's happening at this very same time.
And then look at the personal part. Bill Clinton, former president, husband, of course, of Hillary Clinton, the secretary of state, who is the person who has been really out front leading the diplomacy on trying to get these two journalists out.
She's the one who talked about clemency. She was the one who talked about humanitarian issues. And let's not forget, just a week or two ago, she was being insulted personally by the North Koreans.
So, there are extraordinary levels here. And ultimately, it would have to be Bill Clinton wants to get the two journalists out. That's number one.
CHETRY: The other interesting question is about whether the former president sort of paves the way to smooth things over for future talks, or did he steal some of the thunder, you know, even if it's not purposefully by his wife -- or from his wife?
DOUGHERTY: Well, yes.
But, you know, again, they're trying to keep this separate. But it might ultimately lead to some type of warming. After all, in 1994, Jimmy Carter went to North Korea, and there were some good things that came out of that.
And another thing that we should keep our eye on, Kiran, is whether or not he'll personally meet with Kim Jong-Il. Remember, the leader of North Korea has been reported as being quite ill. He's been seen recently. But we have to really watch whether or not they will personally meet. It will be very, very interesting.
CHETRY: That's right. We'll try to find out more details about that as well throughout the morning. Keep it here for the latest details on what's going on with former President Clinton's trip to North Korea.
Jill Dougherty, thank you.
ROBERTS: What makes Clinton's trip so interesting is for the past few months all of the talk between the U.S. and North Korea was about U.N. sanctions and the potential threat of an all-out war? So could this rally end up being a game changer? For more, I'm joined on the line by John Glionna. He is the "L.A. Times" bureau chief. He's in Seoul, South Korea this morning.
So the former president, John, arrived to a very warm welcome, almost with the air of a fait accompli when he arrived on the ground there. How much do you think this trip was precooked? Does he just merely kind of need to show up, you know, have a couple of meetings, and then the two journalists will be released?
JOHN GLIONNA, SEOULD BUREAU CHIEF, "LOS ANGELES TIMES" (via telephone): Well, I think most of the people that I talked to in Washington earlier today were of the opinion that Bill Clinton is a big enough personality that would not risk the loss of face of him showing up in Pyongyang and returning empty-handed.
And as your correspondent said, the Obama administration is doing all it can to keep these two issues separate. It's very -- it's unclear this morning what exactly Mr. Clinton will bring to the bargaining table other than the fact there is a lot of nostalgia of his administration with Pyongyang.
What followed with eight years with George W. Bush was just a complete deconstruction of any kind of relationship the U.S. had with North Korea.
In fact, Bill Clinton, until the debacle of 2000 election, Bill Clinton was planning on visiting Pyongyang to end his presidency. That didn't work out.
So, the -- I would think that if Kim Jong-Il is -- let's look at it this way. A few months before they took these two reporters in custody, they were getting a cold shoulder from Washington. They were getting not even -- even a whiff of -- of warmth from the Obama administration.
And now we have Bill Clinton, who's a very high-profile visit, is coming. That adds legitimacy in their eyes to their way -- their political way of life. So it's an all-win situation for them.
Sure, they'd rather have -- I would think they would rather have Hillary. But Bill ain't bad.
ROBERTS: Yes, if you're looking just at the optics of all of this, it doesn't get better than Bill Clinton showing up on the ground there.
We always talked about, John, a quid pro quo with North Korea. They never do something for nothing. What do you think the quid pro quo is here?
Jill Dougherty pointed out that their chief nuclear negotiator was one of the people that greeted the president when he arrived on the ground in Pyongyang.
But then there's also this idea of the transition of power between Kim Jong-Il, who by most accounts is ailing, and his young son, Kim Jong-Un. Might this have something to do with the transition of power as well, that if you can get President Clinton there on the ground, it sort of lowers the temperature of brewing hostilities between the two-countries?
GLIONNA: Yes. And who knows? This will all come out in the wash in the next few days, what happens.
I truly believe, as most people that I've talked to today both in Seoul and in Washington, that within the next 24 to 36 hours, Bill Clinton will be boarding a plane with both those reporters.
What happens in the meantime is -- so that's what the U.S., that's what Bill Clinton gets. What does Kim Jong-Il get for the tete-a-tete they're having? I would think it would be all warm and fuzzy. I think he'll meet with Kim Jong-Il. Mr. Clinton might even meet with Kim Jong-Il's son, some of the top leaders in Pyongyang.
And, like you say, it's a breaking of the ice. Clinton goes back, talks to Obama. And, who knows, maybe next time, it's a -- you know, there won't be any of these circumstances. There will be an official visit by the Obama administration.
ROBERTS: Well, certainly fascinating news to see the former president on the ground there. And we're looking forward to see what comes out of that meeting.
John Glionna, good to talk to you this morning. Thanks so much, appreciate it.
GLIONNA: All right. No worries.
CHETRY: Also new this morning, seven countries in 11 days for Secretary of State Hillary Clinton. He's on her biggest international trip yet to Africa. The first stop, Kenya, where Mrs. Clinton is expected to push President Obama's policy objectives laid out last month.
Also on the agenda, the pirate problem in Somalia. She'll meet with former South African president Nelson Mandela, also a close friend of her husband Bill Clinton.
ROBERTS: There's new backlash over those huge bank bonuses that hit a nerve with so many working-class Americans. Bank of America has agreed to pay $33 million to settle federal charges that it hid plans to pay billion to Merrill Lynch employees after it agreed to buy that troubled bank last fall.
Bank of America neither admitted nor denied the charges.
CHETRY: President Obama, by the way, celebrates a birthday today. He turns 48 today. What's he doing to celebrate? Aides say he's meeting with Senate Democrats to discuss health care and Cash for Clunkers. That sounds like a fun birthday lunch. He's going to be having lunch at the White House with them.
Also his press secretary said that Chuck E. Cheese was also booked. That's probably more for the kids, although skeeball is a blast.
ROBERTS: So, the post office, $7 million in debt even though they've raised the price of the stamp. Could this be the beginning of the end for the post office. Is snail mail just too slow. You have to do instant message and e-mail. We'll find out coming up.
It's eight and a half minutes after the hour.
(COMMERCIAL BREAK)
ROBERTS: There's a lovely picture this morning of Charlotte, North Carolina. And the way the sun is blazing, you might get the idea that it is going to be a hot one, like seven inches from the midday sun.
Clear and 70 degrees right now. But later on today, partly cloudy, a high of 92. So, yes, it's going to be hot in North Carolina.
Checking the stories that are new this morning at 11 minutes after the hour.
Uncle Sam has not been this strapped for cash since the middle of the Great Depression. The government is seeing the biggest drop in tax revenues since 1932 because people are spending and earning less. If the figures hold, the tax man will see an 18 percent drop this year while the federal deficit hits a record $1.8 trillion.
CHETRY: Well, could the post office go the way of the phone booth? Even the price of stamps up two cents, the postal service is warning it could lose $7 billion this fiscal year.
The biggest reason, they say, is e-mail. It says that some post offices could close, collections spots could be eliminated, and many postal workers could lose their job.
Congress is also considering a bill that would save the agency money on pensions.
ROBERTS: And the full Senate starts the debate on Supreme Court nominee judge Sonia Sotomayor in just a few hours. It's all but certain that she'll be confirmed before the chambers August recess kicks off on Friday.
Some Republicans are promising to vote against her, calling Sotomayor an "activist judge," and the National Rifle Association is promising to downgrade any senator who votes to confirm the nominee.
CHETRY: More on the breaking news this morning -- former vice President Bill Clinton is in North Korea trying to broker a deal to get two American journalists back home.
All of this happening while his wife, the secretary of state, is in Africa. Hillary Clinton on the biggest international trip she's made so far. So a lot of high-stakes Clinton traveling today. Doug Hattaway is a Democratic strategist and former advisor to Hillary Clinton, worked with the Clintons, and Bay Buchanan a Republican strategist and former adviser to Mitt Romney's campaign.
Good morning to both of you. Thanks for being with us this morning.
DOUG HATTAWAY, DEMOCRATIC STRATEGIST: Good morning.
CHETRY: Doug, I want to start with you. What do you make of President Clinton's trip to Pyongyang? They're talking about a lot of behind-the-scenes backroom dealings going on. They did not release any type of official itinerary.
But he's there right now, and at least it seems to be to try to secure the release of those two U.S. journalists detained?
HATTAWAY: Yes. Apparently, the women's families were told by the Korean government that if Bill Clinton came, they'd release him. And I'm sure he was thrilled to help out in a situation like this.
But you can bet there are a lot of behind-the-scenes discussions. Someone of his stature isn't going to get on a plane and fly out to North Korea without some assurances that something is going to come of it. So I think everybody's expecting that he's going to return with those women.
And it's a good thing, I think, because it could serve as a bit of an ice breaker. We need some thawing with relations with North Korea, which have been tense lately, as you know. And it always seems to be one step forward and two steps back with them.
But I think it will probably be a good move beyond what's going to happen today, getting the two journalists released.
CHETRY: And, Bay, what does it say about the U.S. diplomacy as it -- as it relates to North Korea with the situation? You know, they've been launching these long-range missiles. They've been sort of upping their rhetoric of late.
Yet, they're getting a visit from a former president. This will be the highest profile U.S. visit in nearly a decade. And it has to do with them detaining two U.S. journalists.
BAY BUCHANAN, REPUBLICAN STRATEGIST: You know, I have to say that if the President Clinton can bring those two journalists home, all the more power to them, all the credit of this administration if they were behind this.
And at the same time, we need to defuse the situation in North Korea. And if this will help defuse it, he is popular up in that part of the world, then let's try something, because that's to our benefit to start a good relationship there, or at least an improved one, with the successor of this regime. CHETRY: All right, I want to turn your attention to the situation domestically that's been getting a lot of buzz. Some comments made by two of the top economic advisors in the White House, both, of course, Timothy Geithner and Larry Summers.
And you heard Robert Gibbs yesterday sort of backing off that, saying, no, no, the president is not going to be raising taxes. It was a big campaign promise. And we all know what happens when you make a promise on the campaign trail and then it looks like you're not able to keep it. Let's watch.
(BEGIN VIDEO CLIP)
GEORGE H.W. BUSH, FORMER PRESIDENT OF THE UNITED STATES: Read my lips -- no new taxes.
(APPLAUSE)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: You will not see your taxes increase by a single dime. Not your income tax, not your payroll tax, not your capital gains tax, no tax.
(APPLAUSE)
(END VIDEO CLIP)
CHETRY: All right, the first clip that we saw, Doug, was the famous "Read my lips, no new taxes," when there were some tax increases in the first presidency of George the elder Bush. It some say cost him the election. The Clintons used it very effectively in the 1992 campaign.
Is President Obama facing a possible scenario similar to that if taxes do have to go up inevitably because of so many things going on right now with the recession, with trying to balance the budget, and with health care reform?
HATTAWAY: Well, they're starting out where they need to on consulting the deficit, which is cutting spending. This administration has already found half a trillion dollars in spending to cut. And that's where they need to focus the effort.
And the president has made very clear during the campaign and since that he's not going to raise taxes on the middle class. It wasn't the middle class who were getting rich under the administration of the past eight years. It was the big corporations...
CHETRY: Right, but it seemed that Tim Geithner and Larry Summers couldn't rule that out when asked specifically about whether or not the middle class could possibly face a tax hike.
HATTAWAY: Yes, the -- they're answering -- go ahead.
BUCHANAN: The key here is that you have two number guys making the statement very clearly because they are good. They're looking at the policies he wants. They're adding up the numbers. They don't know another way to do it.
And the president says, oh, no, they're not going to do it. But there's no alternative, Kiran. They don't get to say we're not going to do this, we're going to do this to pay these bills.
HATTAWAY: There are alternatives.
BUCHANAN: Let me just say one thing.
But you know, Doug, you just said that he's going to cut and cut. He's quadrupled the deficit in six months and has more plans for more spending. Then he says I'm not going to increase taxes.
It all doesn't add up. And as a result, the American people no longer trust this president.
HATTAWAY: Well, here's where it starts. It was the corporations that were shipping middle class jobs overseas that made out like bandits under the Republican administration. You need to start there by making them pay their fair share, not rush to the middle class to raise their taxes.
And there is plenty of savings that can be found. Like I said, they found half a trillion dollars in savings already. They can find more savings.
They need to balance that. Make the corporations pay their fair share who have gotten away scot-free under the Republican administration, and give the middle class a break. And that's what the president tends to do.
CHETRY: All right, guys, quickly, looking ahead to the next 100 days, the second 100 days, does health care reform get passed? Doug first.
HATTAWAY: I think so. The American people want it, and if the Democrats in Congress can get everybody in line to pass it before the Republicans and their allies in the insurance industry can poison the atmosphere around it, I think they can get it done. It needs to happen.
There are millions of people who don't have any health care. There's people who have it but really trying to struggle to pay for it. And this needs to get the dealt with.
CHETRY: Last word.
BUCHANAN: Listen, if it was going to pass, it would pass. You have a Democratic Congress, Democratic Senate, Democratic president. It would have passed.
The reason it didn't pass is the American people do not want it. There's anti-health care rallies going on spreading across the country. Just talk to your congressman. Go to the town hall meetings. And they're all going to town hall meetings, and all they're hearing is say no to health care. What do you think is going to happen, Kiran? They're going to come back and they're going to tell the president, listen, my job is in jeopardy if I go with that Obama- care. They're not doing it. It's dead.
CHETRY: All right, well, two very different predictions. I want to thank both of you for being with us. Bay Buchanan and Doug Hadaway, thanks.
And we want to know what you think as well. Have the second 100 days of the Obama administration been days of change, days of frustration? What do you think?
Let your voice be heard. Cast your vote -- CNN.com/reportcard. And get the reports from the CNN national report card. It's Thursday night, 8:00 eastern.
ROBERTS: We've got the breaking news this morning. Former President Bill Clinton is in North Korea to try to win the release of those two American journalists who have been held there since March.
Our John Vause coming up next takes us inside the country and what could be happening on the ground. That's just a minute or two away. It's 19 minutes now after the hour.
(COMMERCIAL BREAK)
CHETRY: It's 22 minutes past the hour. Welcome back to the Most News in the Morning.
If you're just waking up, we're tracking breaking news out of North Korea this morning. Former President Bill Clinton is now on the ground in North Korea. These are some of the first pictures of him arriving.
He's trying to negotiate the freedom of two U.S. journalists, Laura Ling and Euna Lee. Now, back in June, Lisa Ling, who is Laura's sister, talked exclusively to our Anderson Cooper after the two women were sentenced to 12 years of hard labor for accidentally crossing into the border while doing a story on China.
(BEGIN VIDEO CLIP)
LISA LING, SISTER OF LAURA LING: All we can say is that they -- they are journalists, and they were doing their job. My sister has been a journalist for years. And that's really all we can say.
You know, we weren't in the courtroom. We don't know any sort of specifics other than what was released. We just hope, you know, given the fact that we know the girls have apologized profusely, that they will let the girls come home to us.
It's been -- it's been three months, and that's been too long for us.
(END VIDEO CLIP)
ROBERTS: For more on the negotiations, let's bring on our John Vause. He's tracking things this morning from Beijing in China.
John, North Korea is a country that lives by the quid pro quo. So what might they be looking for here in exchange for releasing these two journalists?
JOHN VAUSE, CNN CORRESPONDENT: Well, I'll tell you what they get, John. They get a visit by Bill Clinton. He's not the president, but he's the former president, and analysts say that in itself brings plenty of status, enough for the North Koreans.
They're looking for legitimacy here. You have this former U.S. president being a part of the regime. Legitimacy at home -- most North Koreans would know who Bill Clinton is. Legitimacy overseas -- if Bill Clinton is willing to deal with the regime, then why aren't other countries as well?
And this meeting takes place against the backdrop of a change in tone of the administration, no longer demanding the release of the two reporters, but rather asking for amnesty, saying, yes, they've done something wrong, but we're asking for forgiveness. We respect your system.
And as a sign of that respect, we're sending you an elder statesman, we're sending you Bill Clinton - John.
ROBERTS: All right.
CHETRY: There is also some speculation that Bill Clinton when there will actually meet with North Korea's leader Kim Jong-Il. There's been reports about his ailing health. Do you think that meeting may take place?
VAUSE: Yes, it's pretty much a given that Bill Clinton will have a one-on-one meeting with Kim Jong-Il. It would be very surprising if it didn't take place, unless, of course, Kim Jong-Il's health takes a turn for the worse, if he is physically incapable of meeting with the president, or, North Koreans being North Koreans, if they decided that they'll snub Bill Clinton at the last minute.
That seems very unlikely, because the bottom line in all of this is that they will probably have had this meeting. What they talked about has already been decided by lower-level officials. They'll be handshakes and smiles.
Bill Clinton will then be wheels up in that private jet with Laura Ling or Euna Lee, maybe within a day or two, because, I think as one of your guests said a short time ago, you don't send a former U.S. president halfway around the world to come back empty-handed.
ROBERTS: You also don't do it in the first couple of hours either. You want to keep him there as long as you possibly can, too, right? CHETRY: And we might get some insight, as you said, John, about the actual health of Kim Jong-Il based on whether or not Bill Clinton actually meets with him.
All right, John, thanks.
VAUSE: Exactly, yes. We'll be watching for the photographs which will come out of the meetings later on, have a good look at Kim Jong-Il.
CHETRY: All right, we'll check in with you throughout this show. Thanks so much, John Voss.
Meanwhile, we've been talking about this Cash for Clunkers program, very popular. Will it be able to continue? They need about $2 billion approved by the Senate.
ROBERTS: The House approved it, but will the Senate? It's a little tough sledding there, I think.
CHETRY: That's right.
And meanwhile, so what happens to all of the clunkers after they're traded in? Jason Carroll heads to the junkyard.
(COMMERCIAL BREAK)
CHETRY: Welcome back. Twenty-nine minutes past the hour now.
We're tracking breaking news out of North Korea this morning. Former President Bill Clinton is in Pyongyang as we speak. His diplomatic mission -- to secure the release of two American journalists, Laura Ling and Euna Lee.
The two were sentenced back in June to 12 months of hard labor. North Korea says they entered the country illegally and were trying to launch a smear campaign against their government.
ROBERTS: A plane carrying tourists slid off the runway in Thailand and crashed in an air traffic control tower. It killed the jet's pilot. Officials also say 34 people on board were hurt. The Bangkok Airways flight was landing in stormy weather on the resort island of Samui.
CHETRY: Plus the Dow will open in just a few hours at a nine- month high. Stocks got a Monday rally on better-than-expected results from Detroit and the country's manufacturing sector. The Dow closed up 115 points on Monday, closing at 9287.
ROBERTS: And doesn't it seem like the holidays coming earlier every year? The famous Harrods department store in London is trying to lure in customers by bringing out its Christmas display, Christmas in August. They've got it all, fake snow, Santa Claus, and, as you can see, even some real penguins on hand there as well.
Well, it could be the most expensive download on record, more than $22,000 for one song.
A college student who admitted downloading and sharing music with his friends just got hit with a staggering verdict of $675,000, which breaks down to astonishing $22,500 per song.
So, were they worth it? And does the punishment fit the crime? Joel Tannenbaum joins us live this morning from Boston. He's the Boston University student who got tagged with this bill.
It's good to see you this morning, Joel. You did this from 1999 to 2007. You knew that you were doing something wrong.
Why did you keep doing it?
JOEL TENENBAUM, FINED $675,000 FOR 30 SONGS: Well, it wasn't really something that was foremost in my mind in terms of it being illegal or not. It's just sort of - I had Napster on my computer in front of me. And when I saw it, it was just this library of music in front of me. And so I did what came naturally to - I mean, so many of the people in my generation, try go to the college campus and try to find someone who hasn't done this.
ROBERTS: It wasn't just people in your generation, you know, when Napster first came out, there are all kinds of people who were downloading. But then, of course, there was the court cases against Napster. And everybody said, oh, wait a second, maybe it's not kosher to do. But you kept on doing it, why?
TENENBAUM: Well, it was the same sort of thing. It was Napster went down. There were still platforms out there that I could get free music on. It was something that I was used to doing. It was sort of a social thing with my friends in terms of getting the music that I got. And I think I've explored a lot of music or I wouldn't have gotten the chance otherwise to explored.
ROBERTS: I mean, it could be a social thing among your friends - but Joel, it can be a social thing among your friends to shoplift as well but it doesn't make it right. I wonder why you thought it was right?
TENENBAUM: Well, I mean, it's the comparison of shoplifting - I've heard this if you go in a store and you steal a CD, how is that any different? --
ROBERTS: Yes.
TENENBAUM: And I think that's sort of - I don't think - because I have never stolen a CD from a store. I've never done that. And these are different things, inherently.
ROBERTS: What's the difference?
TENENBAUM: Sure - I'm glad you asked, John. So for example, if nothing else, the amount of work that you have to go to steal something from a store, Go in and sneak it out and I guess (inaudible)
ROBERTS: So because it's easier, it's OK?
TENENBAUM: Well, hold on, let me just - I don't know this is just something that came naturally to so many people in the same situation whereas shoplifting isn't something that does. Even at that point doesn't, you know, convince you, I think if you take polls of people, the vast majority of people do see these as inherently different things. That copying something, that sharing something on- line which is infinitely duplicable and there right in front of you natural is different from taking, from going into a store and like sneaking out of it.
ROBERTS: But perception of the law and the law can be two different things. I mean, you said that you believe that artists deserve to get paid for their work. And yet at the same time -
TENENBAUM: Absolutely.
ROBERTS: You were downloading some stuff. And they weren't getting paid. Here's a couple of quotes from artists. And I'm friends with a number of people in the music business and have been for years as well. And they're against all of this.
Here's what Stevie Wonder said "record companies, publishers, radio stations, retailers, artists, and others in this industry must take very strong positions against the stealing of our writing and music or else those writings and music will become as cheap as the garbage in the streets." Bare Naked Ladies, a band that I first met back up in Canada, said "when the Gap went on-line, t-shirts didn't become free."
So you got a lot of pushback from the artists here saying that downloading music from the internet for free is just plain and simple wrong.
TENENBAUM: Well, yes, John, but you haven't quoted Trent Rezneer, Radiohead, Green Day.
ROBERTS: OK. Let me -
(CROSSTALK)
ROBERTS: Let's - let me quote Trent Rezner from Nine Inch Nails. Who says -- just because technology exists where you can duplicate something, that doesn't give you the right to do it. There's nothing wrong with giving some tracks away or bits of stuff, that's fine. But it's not everybody's right. Once I record something, it's not public domain to give it away freely.
TENENBAUM: Well, he has, actually, on his latest album, he has given away his creative comments. So I don't know -
ROBERTS: But that was his choice, though.
TENENBAUM: No, no, I understand. I don't know where that quote comes from. But I'm focusing more on his just rabid criticism of the RIAA and his continued campaign to extract this campaign which they've said is to teach the public a lesson and the idea is to extract huge sums out of people.
The majority of artists don't see this as threatening. And I think a lot of people discover music this way and then they're paying for it that they wouldn't otherwise discover. So I do acknowledged there's a gray area here. And it's - I don't do it anymore.
But I think it's a gray area. I think it has - I think it can be used for the benefit or the detriment of the artists themselves. But I think that's something that everybody needs to come to terms with for themselves and not to have this huge RIAA machine out to teach the public a lesson on this.
ROBERTS: Mm-hmm.
TENENBAUM: If you're going to - if you're going to make the argument that I'm responsible for hurting the industry and if you can show up in court and you can make an argument for the actual damage that I've caused which I think is more along the lines of 99 cents on iTunes, then sure. If I hurt the industry, I should be held absolutely responsible but in a reasonable way.
(CROSSTALK)
TENENBAUM: ... $675,000 is reasonable.
ROBERTS: Let's talk then about the settlement, $675,000, $22,500 per song. Where are you going to get the money?
TENENBAUM: Well, I don't have any money for that. I don't have the money even for an appreciable fraction of that. I really have no choice at this point but to declare bankruptcy. Another question, John, a lot of people asked me is why I didn't settle? Well, I did try to settle from the start. I offered them $500 after they sent me a letter. I sent a money order to them which they returned saying essentially call him when you actually want to talk.
ROBERTS: So you thought you gave them fair value for the songs based upon what they cost when you download them off from a place like iTunes or something like that, right?
TENENBAUM: I based it - exactly. I based the decision on that $500 should be more than is reasonable and it's what I could put together at the time. I think at the time, they wanted $3,000. Move forward in time to showing up in court in the pretrial days. I offered them $5,250. And they came back demanding double that.
So, now, I don't have that. I would - I was ready to declare bankruptcy. So, I mean, who is being unreasonable? Who dragged who in to court is really the matter of the people who do spin? I never held that I can compete with the RIAA spin. They're a professional spokeswoman who's professionally paid. And so I'll just try to tell it as is it.
ROBERTS: Now you got the backing of a very well-known law professor at Harvard and he's making this a project for his students as well, the fight on your behalf. Do you plan to appeal the decision?
TENENBAUM: Oh, absolutely. We have a lot of options, I've been told, open to us. So I don't know the official names or anything. But we can appeal - we can - we can file some legal motion for the judge to ask him to adjust the amount.
ROBERTS: So here's the -
TENENBAUM: It seems that she was -
ROBERTS: So here's a question for you, Joel, Jammie Thomas- Rasset was in a situation similar as you. She was fined initially $222,000. She appealed and they slapped her with a $2 million. I mean, is there a risk here of going to appeal?
TENENBAUM: Well, I mean, there obviously is that. People remarked jokes like she should have quit when she was behind.
ROBERTS: Yes.
TENENBAUM: I mean, the difference between $200,000 and $2 million. I am sure she can't afford either of those. I'm sure either of those is a bankrupt in judgment. So the number is symbolic because it's not going to be paid.
ROBERTS: Yes.
TENENBAUM: The RIAA aren't going to get that much money and the artists aren't getting money. I mean, the only people making money here are the lawyers. THE RIAA are losing customers. The artists aren't getting money out of this. The RIA has said this is a money- losing campaign. And my generation is just getting alienated and I think, you know, kind of screwed in the whole process (inaudible) but the lawyers.
ROBERTS: We'll keep following this closely. Joel Tenenbaum, good to talk to you this morning. Thanks for stopping by.
TENENBAUM: Sure, John.
ROBERTS: All right. Appreciate it.
CHETRY: 38 minutes past the hour. Coming up tomorrow at 7:30 Eastern, President Barack Obama talks about health care. He is taking his plan to Elkhart, Indiana where he's holding a town hall event there. We're also going to be talking to the town's mayor. What are his constituents think? Do they want to see health care reform? Dick Moore joins us tomorrow.
The president also takes the stimulus pitch - he took it to Elkhart back in February and the town's mayor said that the president may be trying to do too much too fast. It's 7:30 Eastern tomorrow on the most news in the morning.
ROBERTS: So cash for clunkers, we've all heard about the program. The Senate working on whether or not they're going to put more money in to it. But there's questions as to what happens to the cars after they're traded in. We had a couple of people e-mailing us yesterday to say do they get sent to third world countries?
Well, our Jason Carroll went to the junk yard and he'll tell you what happens to your clunker when you cash it in. Coming up next. 39 minutes after the hour.
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CHETRY: It's 40 minutes past the hour. The government's cash for clunkers program is actually running on fumes itself right now. The House has given the green light for another $2 billion that would triple the cash going towards these rebates. What you do is you turn in your gas guzzler and you get a rebate to get a more energy and fuel efficient car. Well, now, the White House is leaning on the Senate to pass it and allow the program to continue.
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ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: We're very hopeful, again, I think if it doesn't happen this week, it's unlikely that we'll make it to the weekend with a program that can continue.
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CHETRY: The White House did say that if you buy before Friday, you should still be able to get your rebate. But all of this got us wondering, where do all those traded-in clunkers actually go. Our Jason Carroll "Minding Your Business" this morning with more on what happens after that trade in takes place?
JASON CARROLL, CNN CORRESPONDENT: We definitely we found out. Got a little mechanics lesson and in the process, one estimate shows some 120,000 cars were traded in under the cash for clunkers program. A lot of you have written in asking if those trade-ins are not supposed to go back out on the road, where do they end up going? Well, you are about to get your answer.
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CARROLL (voice-over): Major automakers reporting a boost in sales. Thanks to the government's cash for clunkers program, consumers giving thanks to.
UNIDENTIFIED MALE: You know, I got $4500 for this vehicle.
UNIDENTIFIED MALE: Deal is done. We are happy for it.
CARROLL: The official numbers not in yet. But already, tens of thousands of owners have dumped their old cars for new ones. What happens to the old ones? A fluid put in to the engines at the dealership makes them unusable. What's next?
UNIDENTIFIED MALE: So this is the first step when they come in over here.
CARROLL: Most end up in salvage yards like this one in Bridgefield Park, New Jersey.
DAN SAVIGNANO: It definitely helped our business out.
CARROLL: Dan Savignano took us on a step-by-step process of declunking the clunker. Step one, evaluation.
SAVIGNANO: These cars came in from the dealership in Teterboro over the bridge.
CARROLL (on camera): So this is an example of some of the clunkers for cash that you're getting, right?
SAVIGNANO: Yes.
CARROLL: These three.
SAVIGNANO: Yes. So the basic on this, normally if it wasn't a clunker car, I could save the doors, probably the air bags, sell them.
CARROLL (voice-over): The government program doesn't allow every car part to be recycled because they don't want certain parts back out on the road.
(on camera): What's the next step?
SAVIGNANO: Step two. When any car comes into our facility, we put it on this rack over here.
CARROLL (voice-over): Evaluation complete - step two. Draining.
SAVIGNANO: Rear end fluids, brake fluids, all the fluids are drained here in this area.
CARROLL (on camera): The next step is to recycle the items that are allowed. In this case, the tires, the catalytic converter, the battery, the condenser, and the radiator. These are the only items from these types of cars that the program allows to be recycled. The next step - it's got to be crushed.
(voice-over): Once it resembles a metal pancake, it's done. Ready for its final step, shredding.
SAVIGNANO: Little pieces about that big. And then it gets exported to any metal recyclers overseas.
(on camera): At the end of the day, if you are to give your assessment of this program. How it's been working for you, so far, what would it be?
SAVIGNANO: We'll definitely build the relationships with the dealers out there, also. And it also helps us, you know, to get every little bit you can out of a car.
(END VIDEOTAPE)
CARROLL: Well, under the cash for clunkers program, there's been some concerns that some of the trade-ins have been sold through auction and do end up back out in the streets. Also some environmentalists question just how fuel efficient some of the cars bought in exchange for some of those trade-ins, you know, how fuel efficient those cars end up being. Not in question, though, at this point, the financial success of the program. Everyone seems to be making money out there. The salvage yards are making money. Consumers seem to be happy, at least for now.
CHETRY: All right. Let's see what happens. Let's see if it passes in the Senate.
CARROLL: Yes.
CHETRY: Again, for more money. All right. Thanks so much, Jason.
Meanwhile, here's a look at the A.M. rundown. This is what's coming up for you in the next 15 minutes. Some big storms popping up in the country's midsection this afternoon. Our Rob Marciano has the latest from the CNN Weather Center for us.
Also, so many of you are confused about health care reform. What will it really mean to all of us. So Dr. Sanjay Gupta is answering some of your questions head on. He's going to be on call for you in just a couple of minutes.
And also there were small signs of a thaw with Cuba after President Obama was sworn in to office. But what's changed now? We're going to be live in Havana for the very latest. It's all coming up for you. Right now, it's 45 minutes past the hour.
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ROBERTS: Good morning, New Orleans where it's clear and 79 degrees. It's going to be a hot, and steamy one today. Later on, partly cloudy with a high of 92. And some severe weather expected across parts of the nation today. Our Rob Marciano at the weather center in Atlanta. He's tracking it all. Hi, Rob.
ROB MARCIANO, CNN, METEOROLOGIST: Hey, John. Hey, Kiran. Slow- moving front is going to be rolling across the Midwest. That will produce severe weather. Yesterday, we didn't have any reports of tornadoes but there is a slight risk of seeing that today from places like say, Louisville, Nashville, especially later on today, I think the main folks(ph) will be damaging winds and maybe some flash flooding because these storms seem to be rolling over the same areas that have -- well not doing so well.
Kansas City over towards Cincinnati, Covington right now looking at thunderstorms. This could certainly bring some travel delays into the picture. Chicago and Atlanta, some clouds, some fog and low clouds this morning. San Francisco and Seattle, I think it will be a little bit more stubborn there. A quick check on some of the action here in Idaho. This is (inaudible), just outside of Boise. 50-acre grass fire. They had to evacuate about 15 homes there. Red flag warning up again for parts of the Pacific northwest. John, Kiran, back over to you. It will be 87, by the way, in New York City.
ROBERTS: Very nice.
CHETRY: We're not complaining, compared to what some of the folks are dealing with around the country today. All right. Rob, thanks.
ROBERTS: Thankfully, we haven't had any 90-degree days, if any as well. Yes.
CHETRY: We even have not any over 85, actually.
ROBERTS: No. We had a long spring, winter, whatever you want to call it.
So you might have some questions about health care. As Congress heads out for the August recess, a lot of people will be talking about this. So many competing plans, so many different things to get your hands around. Our Dr. Sanjay Gupta joins us coming up next to explain some of the questions that you may have. He's got answers for you. It's 48 1/2 minutes after the hour.
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CHETRY: Welcome back to AMERICAN MORNING. If you don't understand all of the ins and outs of health care reform, you're certainly not alone. The plans, the prices, and exactly how it would affect you depending on who you listen to, it's either the best thing in the world or the worst, right?
ROBERTS: Difficult to get your hands around.
CHETRY: It sure is. Well, we're trying to simplify it for you, clarify a little bit. Dr. Sanjay Gupta is in Atlanta this morning, trying to answer your questions. Hey, Sanjay, good to see you.
DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: Good morning. Thank you. Good morning.
CHETRY: So I think one of the things that we heard from one of our callers and something that a lot of people are wondering about. Let's listen and get you to weigh in for us.
GUPTA: OK.
(BEGIN AUDIO CLIP)
CINDY: Hi, any name's Cindy and I'm calling from Covington, Georgia. Dr. Gupta, my question is - why doesn't the government make mandatory prices for doctors and their services? That's the problem, they all charge outrageous prices and vary from place to place, will that change in the new plan? (END AUDIO CLIP)
GUPTA: Well, first of all, Cindy, you're absolutely right. And it's amazing, even among Medicare you have widely varied prices across the country. You know, one operation in one state might cost $6,000, in another state, the same operation might cost $17,000. So it does vary even among Medicare right now. What we're hearing are some specifics coming out of these health care bills. Again, nothing's been set in stone, but we are hearing, for example, that there may be caps on out of pocket expenses and full coverage for things like preventive care.
What we're not hearing specifically is there'll be some sort of set price for various procedures, various tests, those sorts of things. We talked to the White House specifically about that and they said, no, there is no plan in any of the bills so far to set prices across the board, across the country. Now, let me explain a couple of things, really quick.
When we talk about this public option, this idea that the government would have this public option. This option for people who can't afford their health care right now. And it's based on a percentage of their premiums as compared to their income. They might qualify to buy into this public option. If this exists, it's going to, in some ways, compete with private insurance companies and in some ways influence overall how prices are set. You can see there specifically, no payment rates would be lower than Medicare, what they exist now.
Again, keeping in mind that it varies across the country, and also they would not be able to set prices higher than anything in this overall exchange around the country. So no direct setting of prices, but a lot of influence, potentially over prices in the long run.
ROBERTS: And when it comes to that public option, Sanjay, as you well know, critics are saying well the government's going to be able to negotiate better prices than private insurers can because it's going to have a huge pool of people in the negotiating power of the federal government. And therefore, it would be able to negotiate prices that will not be as low as Medicare but will be low enough that private companies won't be able to compete. They'll fall by the wayside and eventually everybody will be funneled into the public plan.
GUPTA: Yes, and that is the criticism exactly right, John. A couple of things though to keep in mind. You know, the criticism about the fact that everyone's going to sort of flood the public option or this public plan, not necessarily, because not everyone's going to qualify. Keep in mind again, the way things stand now that you would qualify to be able to join this government-run public option, only if your premiums that you're paying for health care are about 11 percent or 12 percent or so of your overall income.
So think about that, if you're someone making $100,000 a year, your health care premiums would have to be $11,000 or $12,000 for you to qualify. So it's not going to be open to everyone, first of all. And second of all, it is going to be one of those things that provide health care insurance for people who simply can't get it right now. So it helps address this lack of access issue.
ROBERTS: But, you know, all of that could change though depending on the language, right? As they go through all these machinations and the various and sundry committees that this is going through.
GUPTA: No question. And in fact, I've heard everything from the public option being completely off the table so there would be no sort o government-run system available at all to it's going to be even larger than it is now. So it's August, what is it? August 4th today? We'll see here in a couple of weeks. We'll see you in September, this might change again.
ROBERTS: All right. Sanjay, thanks so much. Good information.
CHETRY: And we want people to know all week long, you can ask Dr. Sanjay Gupta anything you want to about health care reform, go to cnn.com/amfix. Submit your question. You can also leave a voice mail 877-my-amfix. And Sanjay will be answering some of your questions for you, right here on CNN.
Right now it's 54 minutes past the hour.
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CHETRY: 57 minutes past the hour now.
Raul Castro says he's ready to talk and Washington is relaxing some travel restrictions that had been in place for decades on Cuba. So are these two cold war enemies breaking the ice? CNN's Shasta Darlington shows us what's next for these two countries.
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SHASTA DARLINGTON, CNN CORRESPONDENT (voice-over): The signs are positive. The United States pulls the plug on an electronic ticker that blasted Havana with news and slogans for three years. And Cuban President Raul Castro tells Washington time and again he's ready and willing to talk about everything. No topic is taboo, not even human rights. Cubans like what they're hearing.
UNIDENTIFIED MALE (through translator): Positive, of course, it's positive, we have nothing to lose we've been waiting for 50 years.
DARLINGTON: But despite the new tone, the Cold War phone are still hung up on the same points. Just this weekend, Castro warned dialogue is one thing, but the country's political system is not up for negotiation.
PRES. RAUL CASTRO, CUBA (through translator): They didn't elect me president to restore capitalism to Cuba nor to surrender the revolution. I was elected to defend, maintain, and continue perfecting socialism, not to destroy it. DARLINGTON: So what does Cuba want? Above all, an end to the nearly 50-year-old trade embargo. President Obama has lifted some restrictions on Cuban-American travel and remittances.
But Washington wants signs of political change in Cuba before offering more. An apparent stalemate, but there is movement, especially with the U.S. Navy and Cuban forces cooperating in training for natural disasters.
HAL KLEPAK, ROYAL MILITARY COLLEGE OF CANADA: Well, I think we have to move probably in the two areas that have succeeded. The military to military cooperation, and the drug cooperation, and the immigration cooperation I think are the ones that are working now.
(END VIDEOTAPE)
DARLINGTON: The next move may actually come from U.S. Congress when it reconvenes. Lawmakers from both parties have drawn up a bill that would allow all Americans to travel to Cuba, providing Havana with much-needed foreign exchange, Kiran.
CHETRY: Shasta Darlington for us live in Cuba this morning. Thanks so much.
