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Taking Stock One Year Later; Convicted Sex Offender Ordained as Church Minister; Early H1N1 Vaccines; Alabama Ditching Exit Exams
Aired September 14, 2009 - 10:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
HEIDI COLLINS, CNN ANCHOR: Checking stories happening right now.
A pregnant teenager shot this morning while waiting for a bus in Charlotte, North Carolina. Police say the victim was a student at a special needs school. They say she is in, quote, "very critical condition at a nearby hospital." And doctors are doing whatever they can to save her baby. Right now police aren't sure if she was targeted or shot randomly.
The foster father of the missing 5-year-old boy says a sweatshirt found by volunteers is not the boy's. Hasanni Campbell has been missing for more than a month. The foster father Louis Ross told police Hasanni was last seen wearing a gray sweatshirt. Yesterday, searchers found a similar one that was buried. Police are running tests than shirt. Ross and his fiancee were arrested last month on suspicion of murder but released after prosecutors said there was not enough evidence to charge them.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Hold for applause. Fade out.
(END VIDEO CLIP)
COLLINS: Michael Jackson fans get their first look at "This is It," the name of the documentary. The movie is a behind-the-scenes look of what the late pop star's London concert tour would have looked like. The two-minute trailer was shown at the MTV Video Awards last night.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: When I walked in, the banking system, the financial system, was under the verge of collapse. And what have I done? I've essentially taken the program that was voted on by the previous Congress, supported by the previous Republican president, and we've made it work.
(END VIDEO CLIP)
COLLINS: The financial crisis, one year in. When the Wall Street icon, Lehman Brothers, collapsed, of course you remember that, it fueled panic and even more failures. Every American seemed to feel the aftershocks. So where does the crisis stand today? We're going to take a look at the state of the economy. The president weighs in on Wall Street, and our Suzanne Malveaux takes a look at his speech and his call for new safeguards. We'll get to her in just a few moments.
But, first, let's go ahead and turn to Christine Romans, who is part of the CNN money team, of course.
So, Christine, good morning to you.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Good morning, Heidi.
COLLINS: Everybody remembers this day because, I guess the biggest shock for people at home was the stock market. It just -- like this it was the bottom fell out of the ...
ROMANS: It was panic.
COLLINS: Yes.
ROMANS: It was panic in the capital markets, it was panic in the stock market, they were panicked amongst small investors and panic among government officials quite frankly who were seeing something happening part of the -- parts of the economy in the financial system simply shutting down.
There's a big debate about whether people should have not allowed Lehman Brothers to fail, it should have been rescued but many people now, a year later, are saying, the panic was so thick then that some institution was bound to fail and that maybe, just maybe, Lehman was the most manageable of all these sort of unmanageable situations.
So now today, you sit back and what's changed? Well, look the United States government is a major shareholder in two car companies, it's a major shareholder in the insurance industry, it backs your mortgages, it is really taking a bigger part in the economy than we've ever seen.
But in terms of Wall Street and the system with which this could happen again...
COLLINS: Yes.
ROMANS: ...you still have these institutions that are considered too big to fail and there are some critics Heidi who say that some of them were even bigger and more important than before.
What is the role of regulators? Still trying to hash out regulatory reform that is meaningful that prevents this risk taking and pay for risk taking that allowed some of these excesses to build up in the system.
So in some cases, so many things have changed. We have a massive government intervention into the economy, unlike anything we've seen since really World War II.
On the other hand, the Wall Street practices have not been reined in just yet and that's what we're expecting the president to really...
COLLINS: How can that be?
ROMANS: ...choose this moment to really try to -- try to use this moment to try to push for that for more reform.
COLLINS: Sure. Does it seem demanding? It has been a year. And now there's been a lot going on but this is the job of...
ROMANS: Well, it takes Congress.
COLLINS: Yes.
ROMANS: I mean, Congress is now talking about health care reform. Congress is talking about a lot of different things. Congress really spent a lot of -- a lot of time on this during the stimulus fight, during the bank bailout fight, a fight over regulation; there just doesn't seem to be a lot of appetite for that right now.
COLLINS: Yes, I understood. All right and a lot on the plate, that's for sure.
ROMANS: It's very true, you are right.
COLLINS: Christine thanks so much. I know that you're going to be coming back. Because later on in the show, we are going to be talking with Christine, Ali Velshi and Gerri Willis, what has worked and what hasn't. And what still needs to be done, of course.
They'll also be answering your blog questions. We've been asking you for them. Make sure you go ahead and send them to cnn.com/Heidi.
Let's take a moment now to bring in Suzanne Malveaux with a preview of the president's speech that we'll be seeing a little bit later on today.
So Suzanne, clearly he's using this anniversary to drive home a message. But people probably want to know, hey, is this a message for me at home or is he just sort of directing everything to Wall Street?
SUZANNE MALVEAUX, CNN CORRESPONDENT: I'll tell you, it's a message for different audiences, Heidi, because on the one hand he's in the belly of the beast at Wall Street, so he's talking to those financial institutions but he's also really pushing, pushing very hard, Members of Congress to pass legislation to regulate those financial institutions; he thinks that that is the better way to go.
And he wants to reassure the American people, that look, billions of taxpayer dollars are not going to be flushed into the system forever. Main things he's going to emphasis, he's going to say, here's what my administration has done, $787 billion economic stimulus package to try to spur the economy, that it has stepped back from the brink if you will, of a Great Depression. He's going to talk about that, to say we are turning a corner, essentially.
He is also going to make a distinction, is to say we've got things that we've got to get done in the future, but there are some things I inherited from the Bush administration. There are other things that I'm responsible for in my watch.
And again, pushing Congress to try to get tougher on those financial institutions when it comes to regulating them, more control over what those financial institutions are doing to prevent a crisis of this kind from happening again and reassuring the American people that there's an exit strategy here.
And Heidi, that, quite frankly, is a big political concern, it's a personal concern for folks that we have fought to who say, that they fear that the government is playing too active a role in running businesses...
COLLINS: Yes.
MALVEAUX: ...car companies, health care, education, all of these kinds of things. So they've got to say to the American people, we do see an end to this. And that's the delicate balancing act that the president has today.
COLLINS: Yes, very good.
All right, Suzanne, we know you'll be watching it closely for us, thanks so much.
And a reminder to you at home, we will have live coverage of President Obama's speech a few hours from now, that coverage begins at noon Eastern.
On a day when the president focuses on recovery, many Americans are remained of the economic troubles that still remain. Just a short time ago, drug maker Eli Lilly, announced that it will eliminate 5,500 jobs across the world. The company says it will save $1 billion by the end of next year. The company says those streamlining efforts will speed the development of medicines from the pipeline to the patients.
A key Congressional group work on a health care overhaul compromise is meeting next hour. Here is what we know about it. The so-called gang of six bipartisan members of the Senate Finance Committee are looking at a proposal that has no public option or government-run plan. Two leading senators, Democrat Kent Conrad and Republican Lindsay Graham, say any chance for a compromise overhaul lies in the bill. The gang of six is actually studying, Conrad and Graham say, the bill in the House is dead.
And speaking on CBS's "60 Minutes" President Obama says he's confident Congress will pass a good health care bill, despite some Republican efforts to kill reform.
The president's chief spokesman appeared on CNN's "STATE OF THE UNION" Sunday.
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ROBERT GIBBS, PRESS SECRETARY, WHITE HOUSE: I think what the president said, to both Democrats and Republicans -- to Republicans, we need to have that choice in competition, two ideals that quite frankly, they've always fought for. And for our Democratic friends, the public option is a means to an end, but is it not all of health care.
(END VIDEO CLIP)
COLLINS: The bill being discussed by the gang of six is expected to be taken up by the full Senate Finance Committee one week from today.
House Democrats looking to get an apology from Congressman Joe Wilson on the floor may find themselves disappointed. The South Carolina representative says he's already apologized to the president himself for heckling him during his speech last Wednesday and will not be apologizing again anytime soon.
But House Democrats say, he violated the rules of conduct and are planning a resolution of disapproval. Here's how a more restrained Wilson described the situation.
(BEGIN VIDEO CLIP)
REP. JOE WILSON, (R) SOUTH CAROLINA: My whole life has been built around civility. But as I heard what I believe was not accurate information and because I knew the issue, I knew that there's already been votes on providing for citizenship verification and for the speech to indicate that this would be enforceable, it was not. And so I spoke out. I called immediately, I did apologize, but I believe one apology is sufficient.
(END VIDEO CLIP)
COLLINS: The Congressman has also rejected requests from his own party leaders to apologize to the House.
Just days after the eighth anniversary of the World Trade Center bombing, an audio message claiming to be from the man who planned them as well as the attacks at the Pentagon and in Shanksville, Pennsylvania.
In an audiotape that has now surfaced online, Osama bin Laden accuses President Obama of backing off his campaign pledge to end the war in Afghanistan. The tape has not been authenticated but plays over an undated photo of bin Laden. A recent picture of the terrorist leader has not been seen in the last two years.
Let's get over to Rob Marciano now, because this morning we've been talking about this crazy amount of rain across Texas.
ROB MARCIANO, AMS METEOROLOGIST: Yes, Dallas, south to Austin; over the weekend they've seen several inches on some cases over a foot of rain. And the stubborn system just does not want to go away. Slowly moving -- I wouldn't say it's moving. It's just kind of sitting and spinning.
Area of low pressure right here, just kind of drifted north off the Gulf of Mexico; it shifted the rainfall a little bit more north and east and continues to spiral around the center low pressure. And so it's getting into Tennessee and parts of Mississippi but still getting back into the Dallas area as well, so more rain on the way for those folks.
Here's what the Dallas camera looks like, WFAA, shrouded in low clouds and rain, flood watches and warnings actually still posted, extended their flood warning for the Dallas-Ft. Worth Metropolitan area for at least another ten minutes. And down the road, it rains, advance downtown I-20 and through this area, you're still undergoing some flash flooding there.
So it continues to pour down rain in parts of Texas, too much of a good thing for the Austin folks and San Antonio folks for sure. It's going to slowly move over to the east. Most of the East Coast is enduring some nice weather for a change of pace, so that's good news. Daytime high today will be in the 70s and 80s, 80s as far north of Minneapolis, Chicago. 80 degrees expected in New York City. That's pretty toasty for this time of year.
COLLINS: Yes.
MARCIANO: We do have a couple of airport delays: San Francisco an hour and five minutes out there for low clouds and fog; LaGuardia still at that the 30 and Newark looking at 30-minute delays there as well --Heidi.
COLLINS: Are there never not delays at LaGuardia, actually?
MARCIANO: Oh yes, well, I mean the security detail that has to go precede you is slowing things down, I'm sure.
COLLINS: Got it. All right, thanks so much, Rob. We'll see you later on. Thanks.
A convicted sex offender, now an ordained minister. You'll hear from him coming up in a moment.
(COMMERCIAL BREAK)
COLLINS: We have just recently learned here at CNN that the pregnant teenager who was shot at a bus stop this morning in Charlotte, North Carolina, is now dead. Police say the victim was a student at a special needs school. She was taken to a nearby hospital, where doctors tried to save her and her baby. Right now police are not sure if she was targeted or shot randomly.
Shock and sadness this morning, on the campus of Yale University: students are holding a candlelight vigil tonight. They're waiting to find out for certain whether a body found inside a wall on campus is missing classmate Annie Le. Police think it is her. They made the discovery yesterday on what would have been her wedding day. Yale's president reached out to Le's family and sent an e-mail to the campus.
(BEGIN VIDEO CLIP) RICHARD C. LEVIN, PRESIDENT YALE UNIVERSITY: I met earlier this evening with Annie's family, with her fiance and his family and I conveyed to them all the deeply felt support of the entire Yale University community.
(END VIDEO CLIP)
COLLINS: Le, who is 24, was last seen Tuesday going into the medical research building but detectives say she was never seen leaving.
Phillip and Nancy Garrido set to appear in a California court this morning. The two are accused of kidnapping Jaycee Dugard when she was 11 years old. Today's hearing is a bail review, no bail has been set so far. The Garridos pleaded not guilty to nearly 30 felony counts. They allegedly held Dugard captive for 18 years. Authorities say Phillip Garrido fathered two children by Jaycee Dugard.
It's an act of forgiveness and a second chance at a troubled life. A convicted sex offender gets ordained as a minister and spokesperson for a church in Kentucky. And as you can imagine, the protesters were there to greet him at Sunday mass.
Adrienne Hopkins from affiliate WHAF has more now from Kentucky.
(BEGIN VIDEOTAPE)
ADRIENNE HOPKINS, REPORTER, WHAF, KENTUCKY: On any other Sunday, protestors, likely would not have been outside of the City of Refuge Worship Center. But this Sunday was different because a man charged with sodomy, sexual abuse, and intimidation of an 11-year-old boy back in 1998 was ordained -- call him Pastor Mark Hourigan -- hence the controversy.
RICHARD LAUERSDORF, OPPOSED TO ORDINATION: One of the things that really concerned me if this man starts reaching out to other people, what's to keep him from reaching out to child molesters in the neighborhood? We've got roughly I think 13 or 14 child molesters under this zip code.
ROCHELLE FOURNIER, SURVIVORS' NETWORK OF THOSE ABUSED BY PRIESTS: It's wonderful he's a member of the church but he does not need to be ordained as a minister with a position of that kind of authority and power. It's -- it's wrong.
HOPKINS: We were not allowed inside the church for Hourigan's ordination ceremony or ask him or Head Pastor Randy Meadows questions. But the man convicted of two counts of sex abuse, who served four years and eight months in prison, spoke to CNN last week about why he's pursuing this path.
MARK HOURIGAN, ORDAINED MINISTER: I felt because of the acceptance and the love in the way that Pastor Randy has reached out to not just me but a lot of people who have been rejected, that God can use me to reach out to those people that need that hope and need that light. HOPKINS: And a friend of the church, Reverend Aletha Field, spoke on behalf of Hourigan and Pastor Meadows before the ceremony began.
REV. ALETHA FIELD, SUPPORTS CITY OF REFUGE WORSHIP CENTER: In all of it though, this is really about what God has called forward. I believe that's what the pastor believes and the church members who have been, you know, made aware of all of this way before, you know, any media blitz.
HOPKINS: Still, members of the Survivors Network of those Abused by Priests say the pulpit is not the place for a man listed on the sex offender registry for life.
COLLEEN POWELL LEADER, SURVIVORS' NETWORK: I know from my abuse when I was young that we look up to our ministers and priests, and that status gives him more power, and that's what sexual abuse is all about, it's a power play.
JOHN SCOTT, OPPOSED TO ORDINATION: It really hurts. It really hurts, you know? I said, my, I could not believe it. I said, maybe they are naive, something's wrong. So I let my conscience be my guide. That's one reason why I'm here.
FIELD: I know Pastor Meadows holds his ministry team in very high accountability, whether it's the folks who are being ordained today or the people who have previously been ordained and the accountability is just really amazing.
PASTOR RANDY MEADOWS, CITY OF REFUGE WORSHIP CENTER: I want everyone to know that this church, in no way, shape or form, will be putting the children of this church in harm's way, the members of this church, or brother Mark in harm's way.
(END VIDEOTAPE)
COLLINS: A vaccine against the H1N1 swine flu virus may be available earlier than expected. But do you want to get it?
(COMMERCIAL BREAK)
COLLINS: Checking our top stories now. The U.S. let him go from Guantanamo Bay, now he's turning up again as a terror suspect overseas. The Associated Press says Mehdi Gehzali was arrested in Pakistan last month. He's a Swedish national whom the U.S. held at Gitmo for two years. Gehzali got out in 2004 and denies links to al Qaeda, but Pakistani police think he was trying to meet up with al Qaeda operatives.
And remember this? During former President Bush's trip to Iraq in December; the family of the shoe thrower was expecting him to leave prison today but a lawyer for Muqtada al-Sadr tells CNN a paperwork snag will keep him there until tomorrow. The journalist said he was protesting the U.S. occupation of Iraq. He got one year in prison for it but he's getting time off for good behavior. A ploy by State Troopers to catch a brazen bank robber seems to have paid off. Police say they have captured the man they believe is responsible for robbing at least ten banks across four states. A retired state trooper says he recognized him at a motel in Missouri. He says he did a license plate check of the man's car on the America's Most Wanted Web site and it matched.
The nation's financial crisis and a key milestone one year ago today, what has the government done right and what has it done wrong?
(COMMERCIAL BREAK)
COLLINS: The swine flu vaccine may be available a couple weeks earlier than we thought it would be. Here's what President Obama's top health official says.
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KATHLEEN SEBELIUS, HEALTH AND HUMAN SERVICES SECRETARY: We are on track to have an ample supply rolling by the middle of October, but we may have some early vaccine as early as the first full week in October. We'll get the vaccine out the door as fast as it rolls out the production line.
(END VIDEO CLIP)
COLLINS: So here's the question, when the vaccine is available, do you want it?
CNN's senior medical correspondent Elizabeth Cohen joining us now: it's a good question. People want to know how safe the vaccine is I'm sure and how many people has it been tested on?
ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: Right exactly pretty much nobody wants to be a guinea pig Heidi. They want to know how many other people have received the shot before I received it, and were they ok?
So let's talk a little bit about the clinical trials that are go on right now for the swine flu vaccine. According to the National Institutes of Health, by the time this vaccine goes on the market 1,200 children will have received it in studies, 3,100 healthy adults including elderly people and 240 pregnant women.
Now, we're told by the folks who are right now as we speak in the middle of doing these studies that so far there have been no red flags, nothing bad, has happened to the people who are receiving the shots.
You can see here some children who were involved in the clinical trials.
COLLINS: Yes. So the vaccine will be available earlier than expected. But it's not early enough, really, is it to stop outbreaks in certain parts of the country?
COHEN: That's right. Heidi, in certain parts of the country you could say the cat is out of the bag, swine flu is out...
COLLINS: Yes.
COHEN: ...and it is widespread. We both live in the southeast, I'm sure it's true at your children's school, I know at mine, I get e- mails all the time from the principal saying new cases of H1N1. So it's interesting, flu is widespread in the southeast in states like Arkansas and Oklahoma -- oh Arizona, rather, Arizona, Oklahoma, Alaska.
But hopefully once this shot comes out it could hopefully stem those epidemics, make them smaller than they would have been without the shot.
COLLINS: Yes, I have to tell you, I went to the doctor earlier this week and he told me exactly that, something like twice as many people coming into the urgent care facilities either wondering if they had it or really having it and having to treat it.
So let's get back to some of these risk groups. Pregnant women and vaccine trials, I understand you're taking a little bit closer look at that because that's one of the risk groups, right?
COHEN: That's right. I'm going to be headed to Vanderbilt University tomorrow to talk to pregnant women who have volunteered to be, well, I guess you could say, guinea pigs...
COLLINS: Wow.
COHEN: ...they're part of the studies, they are going to get shots and then they'll follow up with them and see if anything bad happened and to make sure they have the proper immune response they're supposed to have.
And I'll be asking them, are they worried at all? They are among the first pregnant women to get the shot, are they worried about risk they're taking of themselves and their unborn children.
COLLINS: Yes, fascinating. All right, very good, Elizabeth. We will certainly be watching that. And don't forget about empowered patient, right?
COHEN: That's right, if you are a pregnant woman or you know a pregnant woman and you have questions about the H1N1 virus, send me your questions to empoweredpatient@cnn.com.
COLLINS: Very good, Elizabeth Cohen, thank you.
COHEN: Thanks.
COLLINS: If you don't pass it, you don't leave high school. Exit exams are the last hurdle now for most public school students in the U.S. But a new development that could have your high-schooler wishing to move to sweet home Alabama. We'll tell you why.
(COMMERCIAL BREAK) COLLINS: Well, the new school year just started. But your high- schooler may already be worried about how it will end. As of last year, 26 states had a high school exit exam or at least planned to start using one. More than two-thirds of the American public school kids have to face down that last obstacle in order to graduate.
But all of that is changing in Alabama. Tommy Bice is the deputy superintendent for the Alabama State Department of Education. He's joining us now live from Montgomery.
All right, so quickly, thanks for being with us, but some people may not be familiar because of where they live in this country. In order to get out of high school now you have to take this exam that says hey, I actually learned a few things. But you are not quite in agreement with that, tell me why.
TOMMY BICE, DEPUTY SUPERINTENDENT, ALABAMA STATE DEPARTMENT OF EDUCATION: Well, we've looked at best practices across the state, across the nation and internationally and have found that just knowing the content knowledge and specific courses is not enough.
COLLINS: Ok.
BICE: We've tried to listen to the recipients of our customers, the higher ED community, the business community and they're wanting more of our students. So that was why we're looking at this change.
COLLINS: Ok, so are you saying that you want perhaps even more detailed testing to take place?
BICE: What we will get from this new move in Alabama is less testing, more rigor, but also move meaningful results and being able to say to the institutions of higher ed and the business community that our students are actually college- and career-ready.
COLLINS: So, what about tests like the ACT or even the SAT tests for the national entrance exams? Does that completely replace the need for a state graduation exam?
BICE: Not at all. We will be doing that in combination with. Our graduation exam will be moving to end-of-course tests, which actually accomplishes the same thing, but we will also be administering the Explore, Plan, and ACT and Work Keys (ph) assessments, beginning in the eighth grade so we can gauge not only from those end-of-course tests, how our students are doing in terms of content knowledge, but also in terms of their ability to succeed at the college and career-ready level.
COLLINS: How are your students doing across the state, if you were to give them a grade, if you will?
BICE: Depends on what measure you're using. In terms of current Alabama high school graduation exam, we're doing extremely well. But again, that only measures content knowledge. If you look at our current ACT scores... COLLINS: Yes, well I guess -- pardon the interruption. Personally, you're an administrator, you are obviously watching and hearing from a lot of kids across the state. How are they prepared for college in the state of Alabama?
BICE: If you look at the results, I would say adequately prepared but we could do far, far more. And that's why we want to up the standard of what we're looking for for our graduates.
COLLINS: Yes. In fact, one of the reasons given for the change is complaints that Alabama students are not prepared for college or work out of high school, if they don't choose to go to college. In fact, I'm sure you're probably familiar with this, Gary Warren, a state school board member actually said this. "Birmingham News": "It's also about workforce readiness. This will help our children prepare for life outside of high school." Is the decision to get rid of the exam partly in response to that?
BICE: In part, absolutely. we always want to listen to our business community because they're the recipient of our product. And they very much want to make sure that our children not only are proficient in the content of what they have been taught, but they can do something with that content.
That's why we've moved -- made this move so we can use the ACT as that measure to show them that the students are capable of that work. It will cause us to change many of our instructional practices, and as I said earlier, much more rigorous approach to graduation.
COLLINS: All right. Well, Tommy Bice is deputy superintendent of Alabama state department of education. Thanks for your time.
BICE: Thank you, Heidi.
COLLINS: A two-week teacher's strike in Kent, Washington, may soon be over now. A tentative agreement has been reached. In about an hour, the teachers will vote on the contract proposal. Reporter Lindsay Cohen from our affiliate KOMO tells us the teachers hope to finally get the smaller class sizes they've been fighting for.
(BEGIN VIDEOTAPE)
LINDSAY COHEN, KOMO-TV CORRESPONDENT (voice-over): The rally started just like any other. But that one triumphant moment couldn't come soon enough.
UNIDENTIFIED FEMALE: I am pleased to announce that we have a tentative agreement.
(APPLAUSE)
COHEN: The cheering was followed by hugs and hysterics and emotions across the board.
UNIDENTIFIED FEMALE: It was incredible. It sent chills.
UNIDENTIFIED FEMALE: It was pretty intense.
UNIDENTIFIED MALE: It was a sigh of relief.
COHEN: Relief and rejoicing came upon this crowd as they share the news. The Kent School District and the teachers' announced they have reached a tentative contract. It follows months of negotiations, weeks of striking, and hours of worrying what's next.
ANNE PAYTON, TEACHER: It brings some closure to two weeks of wondering, what is my life all about?
CINDY HIGGINS, TEACHER: You want to be in the classroom teaching kids. That's what we do. We love what we do. And yet, if nobody stands up for kids on the line, then it's not going to be any better.
UNIDENTIFIED FEMALE: God, I'm speechless.
COHEN: The speechless moment comes just in time. A judge had ruled that if teachers did not go back to work by Monday, they faced fines of $200 per person per day. Some teaches argued they'd rather face the penalty than give up on keeping class sizes small. It's been the biggest sticking point in what seems like an endless stalemate that now appears to have broken.
VERONICA COOK, TEACHER: If they're just a number and not a person, we're not going to improve their school.
UNIDENTIFIED FEMALE: It's a pretty major thing when it looks like an end in sight and you can start healing some of the wounds.
(END VIDEOTAPE)
COLLINS: If teaches are vote to approve the contract, classes will begin again tomorrow.
Taking stock of the nation's financial crisis one year after a major milestone. We look back at what's been done and look ahead to the challenges that still remain.
(COMMERCIAL BREAK)
COLLINS: Checking our top stories now. Lawmakers taking another stab at health care reform at top of the hour. The so-called Gang of Six, bipartisan members of the Senate Finance Committee are looking at a proposal that has no public option or government-run plan. Two leading senators, Democrat Kent Conrad, and Republican Lindsay Graham, say any chance for a compromise overhaul lies in the bill the Gang of Six is studying. Conrad and Graham say the bill in the House is dead.
And speaking on CBS' "60 Minutes," President Obama is confident Congress will pass a good health care bill, despite some Republican efforts to kill reform.
Phillip and Nancy Garrido set to appear in a California court this morning. The two are accused of kidnapping Jaycee Dugard when she was 11. Today's hearing is a bail review. No bail has been set so far. The Garridos pleaded not guilty to nearly 30 felony counts. They allegedly held Dugard captive for 18 years. Authorities say Phillip Garrido fathered two children by Jaycee Dugard.
He's one of the reasons you can carry only small amounts of liquids on an airplane and now, he'll spend the next 40 years in jail for a plot to bomb airliners. Abdulla AhmedAli was the ringleader of the trio convicted last week for scheming to blow up planes with liquid explosives hidden in soft drink bottles. All three were arrested back in 2006 and sentenced in London today. The judge sentenced his two accomplices to a little over 30 years apiece.
It was one long year ago that the stock market took its biggest dive since 9/11. Worldwide financial crisis was ignited. Credit froze. Spending stopped. And layoffs mounted. Susan Lisovicz reports on the lessons learned.
(BEGIN VIDEOTAPE)
SUSAN LISOVICZ, CNN CORRESPONDENT (voice-over): The exotic instruments that brought about the biggest bankruptcy in U.S. history are still hard to grasp. But the economic destruction caused by the collapse of Lehman Brothers is not.
BERNIE MCSHERRY, SENIOR V.P., CUTTONE & CO.: There was definitely panic in the air. I was here on the trading floor just behind us here, 1987, during the crash, and that was bad, but this was much worse. This was a feeling that the system itself was coming unglued and that perhaps when the next morning came up, we might not have ATM cards that work.
LISOVICZ: Lehman failed in an economy already reeling from the government's arranged marriage of Bear Stearns and seizure of Fannie Mae and Freddie Mac. Some experts say it was ultimately the government's inconsistent response to failing companies and then its warning of financial Armageddon without passage of an emergency stimulus that triggered the panic in worldwide financial markets.
BILL ISAAC, FORMER FDIC CHAIRMAN: The government really needs to communicate when you're in the middle of the crisis, that you're in charge, you know what you're doing, and here are the rules, here's what we're going to do to calm the situation down. And we didn't do that.
LISOVICZ: Lawrence McDonald worked at Lehman and wrote a book about it. He says the lesson of Lehman begins at the company itself. He says Lehman wasn't too big to fail. It was too big to succeed.
LAWRENCE MCDONALD, AUTHOR, "A COLOSSAL FAILURE OF COMMON SENSE": It's too big to be managed. In essence, it's the same group of people that were running a $38 billion institution in 1998, the same group, fast forward to 2007, is running $780 billion worth of risks.
LISOVICZ: But risk isn't as much of a threat to the economy anymore. Rather, it's the almost complete lack of risk, a credit crunch that is yet another legacy of Lehman, one year after its devastating collapse. (END VIDEOTAPE)
COLLINS: Susan joins us from the New York stock Exchange. She is outside, just steps away from where the president's going to be speaking later on today. Hi there, Susan.
LISOVICZ: Hi, Heidi.
COLLINS: Then and now, any major changes on Wall Street?
LISOVICZ: Well, Heidi, let me just run down a quick list for you. First of all, traders continue to buy and sell unregulated exotic financial instruments. Yes, the same kind of instruments that got AIG into so much trouble. Why? Because they can.
Credit rating agencies continue to get paid by their customers, a conflict of interest that was yet another culprit in the financial breakdown. The controversial accounting system that made valuing the toxic assets so difficult and also unloading them so difficult, continues.
What's changed since then? Well, the U.S. government is now the banker of last resort, the insurer of last resort, the automaker of last resort. And, Heidi, reforming and overhauling the financial system, which is a Herculean task under any circumstance, seems to have lost the urgency because the U.S. economy is slowly getting better. The stock market has rebounded. And so, that's a problem because one thing we know is that bubbles happen. We've seen at least three of them in the last decade. Another one will surely occur, and nothing's really changed.
COLLINS: Yes. Understood. Of course, the big question now, we continue to improve and then sustain. All right. Susan Lisovicz, on the street down there, Wall Street, thanks so much.
LISOVICZ: You're welcome, Heidi.
COLLINS: One year ago today, Lehman Brothers collapsed. And America entered its worst financial crisis since the Great Depression. Since then, the government has taken drastic measures to stop the bleeding.
We wanted to ask the CNN Money Team, what has worked and what has not? So here with some answers, our brilliant money team, Christine Romans, Ali Velshi and Gerri Willis. Thanks for being with us on this day.
A lot of questions, in fact, from the viewers to get to. Ali, I want to start with you. The focus on the Fed and the banks. Where are we now, as compared to one year ago?
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: You know, some people think that the middle class in this country is disappearing. You might think the middle class of banks is disappearing. You've got the strongest and the biggest of the banks, which are now going to be protected, and have been protects by the government. You've got a lot of small banks that have failed. That's being handled by the FDIC.
So, that's not all that bad. FDIC's handling it. What we don't have is a financial system that runs on its own or walks on its own two legs. Basically, the last year has been devoted to stabilizing the system, putting out the fire if you will, and now we'll try to come in with more rules. You'll be hearing about that from the president at noon.
COLLINS: Yes, true. Christine, what about you? Let's talk about the markets for a minute. With regard to those numbers, what's worked and what hasn't?
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Well, there's the stock markets and there's capital markets and lending markets. And lending, the capital markets, much bigger than the stock market.
The stock market has come back gangbusters since the 12-year lows in March. If you look at your 401(k), you know, you're going to notice it's not so bad this year. You have still lost a lot from the peak in the market. So, on the one hand, it's been the rally of a lifetime in the short term. On the other hand, it's been the collapse of a lifetime in terms of your stock investments.
In terms of the market, the market to borrow and lend money -- that has been slowly improving. It really has. Last September, you saw that market absolutely freeze up and there was panic about what was going to happen, the way the oxygen to the financial system had just been shut off. That slowly -- some would say because of some government efforts, but also because of time and a little bit of a return of confidence, that has started to improve.
COLLINS: OK. I guess they would.
Gerri, what about the housing industry? Talk about panic that Christine was just mentioning. Foreclosures and everybody worrying -- not everybody, but a lot of people, worrying about whether they'll be able to continue to pay on their homes. What has the government done right and wrong?
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Well, I think you've got to say that they've had a hard time putting together a program that can get traction with people defaulting on mortgages, having trouble with mortgages. Only 12 percent of people who are eligible for Making Home Affordable have become part of the program. And they're only in the introductory phases of that right now.
So, I think you have to say that program is not working as it should. There's been a lot of disappointment there. Now, the first- time home buyer tax credit of $8,000, that's something that's getting some traction and people are using.
But at the end of the day, you've got to say, prices came down 30 percent from the peak. Even if you're not in foreclosure, even if you haven't defaulted on your mortgage, you're worried, and you continue to worry about the loss of equity, about the loss of the value of your house. COLLINS: Yes, absolutely. And then talk about unemployment at this point now, too, and that brings up a whole other discussion, obviously.
Guys, listen, we have been getting in quite a bit of viewer e- mails. I want to get some of them out so you can answer them. Mike from Texas wants to know this. "They're talking about a second dip in the economy. The last time this happened, it went from a recession to a depression. Are we heading for a remake of the 1930s?" Ali, we'll start with you.
VELSHI: You know, there is likely to be a second dip -- a second dip in something in this recession that we are smart enough to expect other things to happen. I do think the difference between now 1930s, is government intervention was earlier on in this case, and I think they've learned a lesson. Regardless of how you see what happened a year ago, people think the government should have stepped in to save Lehman, and that might have saved further action.
There's nobody -- not nobody -- there are a minority of people who think the government shouldn't have done anything here, and I think we learned that lesson.
ROMANS: You know, Heidi, the real hard part now starts. What Ben Bernanke and this president and the treasury secretary, what they do now to unwind all this government intervention is going to be very important and a lot of economists, what they do next is maybe even more perilous and critical than fumbling our way through the crisis a year ago. Because in the Great Depression, there was a really bad period, 1937, after things started to look like they were turning around. That was the big depression within the Depression. They have an eye to what happened in the Depression to make sure they don't do that again.
COLLINS: True. Gerri, any comments on this?
WILLIS: I have to tell you, you've had the best student of depressions on this, right? Ben Bernanke. He was the student of the Great Depression, very familiar with it. If you want the guy at the head of the fed, that's who you wanted, Ben Bernanke.
What we're hearing from individuals is, can this turn into something bigger now? I think there's so much stimulus money coming in right now, the bigger problem probably for your wallet is inflation. Prices are going to go higher, interest rates are going higher, and that's what we're watching out for and trying to provide the best advice about.
COLLINS: Yes. I can't believe there would be too many people who would say, hey we're out of the woods, things are great now. Really have to be defensive almost. This last one, Eric from Ft. Lauderdale, says, "Since Wall Street has failed to learn lessons of the past in relation to this debacle, what can we as consumers are do to protect ourselves and our finances from falling prey to the irresponsibility of financial markets?" Pretty darn good question, guys. VELSHI: I'd say the number within thing we've learned, number one lesson we've learned is save. So, when somebody says there's a second leg to the downturn -- I don't know there is, but I would say protect yourself by dealing with your credit, saving, and having some sense of where better employment opportunities might be if you see that steamroller coming toward your industry.
ROMANS: And ironically, saving is something that will slow the economic recovery. If we all save and repair our balance sheets as we should, that means the consumer's he going less aggressive, and we're a consumer-based recovery. I say, don't worry about the rest of the economy, worry about yourself, and you've got repair your balance sheet if you can to protect you in case something else happens down the road.
WILLIS: The reality is no one's going to help you out, right? It's your responsibility at then of the day, now, to save for your retirement. But also to take care of your money day-to-day, to make sure that you're getting the right mortgage, you're not buying too much house. These are the lessons of the crisis that we've had. At the end of the day, it's up to you. We don't even have that consumer financial protection agency up and rolling yet. None of that has happened. At the end of the day, the responsibility falls with the consumer.
ROMANS: I bet we'll have the president talk about that agency today and talk about really pushing that. There's been a lot of money against the idea of this consumer protection agency, a lot of lobbying against it. I bet you'll hear him push for it again today.
COLLINS: Yes. Probably. And Gerri, I was going to try to predict what you're going to say there, because I thought for sure you were going to say protect your job. But I'm sure all three of you would agree on that, right?
WILLIS: That's a good point.
COLLINS: Hey, guys thanks so much. Gerri, Christine and Ali, we'll talk again soon.
WILLIS: Bye-bye.
COLLINS: And a reminder, live coverage of President Obama's speech coming your way less than two hours from now. Our coverage begins at noon Eastern.
Some people don't want their tax money to help cover the uninsured. Some don't like the idea of government-run health care. Is there something else behind the fury of health care reform? The issue of race?
(COMMERCIAL BREAK)
COLLINS: Remember all of the talk about a post-racial America after President Obama was elected? Forget it. At least according to author and activist Tim Wise. He says he's seen racial undertones in the health care debate at recent town halls and tea parties. He talked with our Don Lemon this weekend.
(BEGIN VIDEO CLIP)
DON LEMON, CNN ANCHOR: You heard the chairman from Florida saying no, it's not race, it does a disservice. You hear David Serota say, of course it is. It's a factor. It's the elephant in the room.
TIM WISE, AUTHOR AND ACTIVIST: Like I said on the show before, it's the background noise of a lot of the opposition -- not all of it, but a lot of it. When you have someone like Glenn Beck saying as he did about a month ago the health care debate isn't really about that, it's just reparations for black people.
Or you have Rush Limbaugh yesterday on the air, saying, first that community service is the first step toward fascism, which is bizarre even for him. And then almost immediately after that, saying one of the problems with America is too much multiculturalism. You wouldn't say that unless you're trying to stoke white racial resentment. So when you say those things, I want to know when are Republican leaders going condemn that rhetoric. Because that's where race is being interjected. It's not being interjected by us, it's interjected by the leading talk show hosts in the country.
LEMON: Is it knowingly, or is it -- maybe unwittingly they're doing it and maybe they don't realize that they're doing it?
WISE: Well, two things. It may be either/or but it doesn't matter. Racism needs to be evaluated based on outcome. If you do something which has a predicable consequence, you have to be accountable for the consequence.
So, for example, when Glenn Beck lied and said Van Jones was involve in the Los Angeles riots, which was not true, that is a very clear, as David said, dog-whistle politic moment. You're saying that because you know that the L.A. riots are a viewed as racialized rebellion and scares white folks to death.
So, you say that about this man, you know it isn't true. Glenn Beck had to know it was not true. And that's a way to scare white folks, where race comes in. It's not old fashioned, but it's white racial resentment they in are trying to whip up.
(END VIDEO CLIP)
COLLINS: The White House doesn't agree with that assessment, as indicated on CNN's "State of the Union" yesterday.
(BEGIN VIDEO CLIP)
ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: I don't think the president believes that people are upset because of the color of his skin.
I do think -- I do think, again, this rhetoric often just gets way too hot. I think what we have to all do is take a step back, take a deep breath, and remember who we're here to represent. (END VIDEO CLIP)
COLLINS: The White House sees the opposition to the president's plan as political instead of racially motivated.
It wasn't Kanye's moment, but he certainly made it his. The rap star takes over at the MTV Awards.
(COMMERCIAL BREAK)
COLLINS: Rapper Kanye West is the talk of MTV's Video Music Award show last night. West interrupted country star Taylor Swift during her speech accepting the award for Best Female Video. West thought Beyonce should have won. Take a look.
(BEGIN VIDEO CLIP)
KANYE WEST, MUSIC PERFORMER: Taylor, I'm really happy for you. I'm going to let you finish, but Beyonce had one of the best videos of all time!
(AUDIENCE BOOS)
WEST: One of the best videos of all time!
(END VIDEO CLIP)
COLLINS: Every time I see this, I just am stunned. Beyonce later won the Video of the Year award and invited Swift on stage to finish her interrupted speech. Good for her. West later apologized for his behavior on his blog.
That will do it for me right now. I'm Heidi Collins. Thanks for watching, everybody. CNN NEWSROOM continues with Tony Harris.
