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American Morning
"Jihad Jane" Indicted: Penn Woman Faces Terorism Charges; Who is "Jihad Jane"?; The Mystery Behind Massa's Resignation; Small Gains, Big Hopes; Tweaking the System; Extending Unemployment Benefits; Protesters "Arrest" Insurance Execs
Aired March 10, 2010 - 06:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JOHN ROBERTS, CNN ANCHOR: Good Wednesday morning to you. Thanks so much for joining us on the Most News in the Morning on this March 10th. I'm John Roberts.
KIRAN CHETRY, CNN ANCHOR: I'm Kiran Chetry. Thanks for being here. Well, here are the big stories we'll following for you this morning.
A Pennsylvania woman has now been charged with recruiting terrorists online and also plotting to commit murders overseas. Authorities say she calls herself "Jihad Jane" and they stress that her case is a disturbing example of the evolving face of terrorism. We're live in Washington and Pennsylvania with new information.
ROBERTS: Why did New York Congressman Eric Massa resign? Your guess may be as good as his. Massa has blamed cancer, a political conspiracy and health care for quitting Congress. We're going to tell you what he is saying now in the face of allegations that he sexually harassed a staffer. A live report from Washington just ahead.
CHETRY: And this morning, you'll hear the 911 call from inside of a runaway Prius. We brought you the story of the driver yesterday. Well, now we hear him in the phone talking to the police dispatcher saying he's standing on his brakes and still can't get his car to stop as it speeds more than 80 miles an hour across a busy freeway.
ROBERTS: But first, U.S. officials say it's a case that shatters any thought that we can spot a terrorist just by appearance. The Justice Department releasing details about the arrest involving a middle-age woman from Pennsylvania. Authorities say she calls her "Jihad Jane." She is charged with recruiting terrorists on the Internet, even offering to kill a Swedish artist.
We've got complete coverage this morning. Our Susan Candiotti live in Pennsburg, Pennsylvania. And Jeanne Meserve is live for us in Washington.
Let's start with Jeanne. And what are we learning today, Jeanne, about "Jihad Jane"?
JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: Well, she called herself that, authorities alleged in a YouTube posting. She's charged with conspiring to kill in a foreign country and providing materiel support to terrorists. The Justice Department and other U.S. government agencies declined to comment on her target.
But according to a government official familiar with the case, it was a Swedish artist names Lars Vilks whose controversial cartoons of the prophet Muhammad with the body of a dog led Al Qaeda to put a price on his head.
Colleen R. LaRose, 46 years old of Pennsylvania, is described by a law enforcement official as blond, green eyed and a convert to Islam. According to an indictment unsealed Tuesday, she conspired with five unindicted co-conspirators to raise money and recruit men and women to join jihad.
The government says one of those co-conspirators ordered her to kill a Swede identified by the source as the cartoonist Vilks. The indictment says she agreed saying, "I will make this my goal till I achieve it or die trying." The indictment says she traveled to Europe to train and kill her foray (ph) saying, "Only death will stop me here that I am so close to the target."
According to law enforcement, she was arrested on October 15th of last year in Pennsylvania, and has been quietly held at a detention center in Philadelphia to protect an ongoing investigation. That investigation apparently linked her arrest yesterday by Irish authorities of seven individuals reportedly targeting that same Swedish cartoonist, Lars Vilks. Colleen LaRose's lawyer had no comment, John.
ROBERTS: It's a very, very strange case. Jeanne Meserve for us with the latest. Thanks, Jeanne.
CHETRY: Sources have been saying, officials say that Colleen LaRose was considered to be an asset to terrorist groups because of the fact that she blended into mainstream America. Our Susan Candiotti is live in Pennsburg, Pennsylvania, with more about exactly who this woman was.
Good morning, Susan.
SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: Good morning, Kiran. And as it turns out, she he lives on main street in Pennsburg, Pennsylvania. This is the main street and this is the two-story duplex where she lives up on the second floor, an apartment over to the left-hand side. Not many people around here know much about her, didn't have much to say. One woman recalled going to a Halloween party with her some time ago. But this is how one woman reacted when she heard about the charges.
(BEGIN VIDEO CLIP)
BILLIE JOHNS: SGRO, KNOWS COLLEEN LAROSE: She scares the hell out of me. Sorry, but it scares me, because I have three -- I have three young kids. And it scares me.
(END VIDEO CLIP) CANDIOTTI: Now this is some of the information we are turning up about her. We learned that the woman known at "Jihad Jane" has a couple of arrests on her record, back in 1997 both of them. One is a DUI arrest. One was for passing a bad check. This is in San Antonio, Texas, where she is also reportedly divorced and lived in Texas until 2004 when she moved here to Philadelphia.
She is also known to be very active online. On the Internet, we found a number of postings with her name attached to them, including one in February of 2008, which she writes to a man. In it she says -- let's see. Asalam Alaikum, which means Allah, peace be with you. "You make me so happy," she writes. "I cannot put into words how much you make my life complete. Inshallah, which means God willing, one day I will at your side as your wife and never leave your side."
Now, prosecutors say about four months after that is when in another posting she said she wanted to do something, was desperate to help Muslims, to help alleviate their suffering. We also learned that she is also a member of something called revolutionmuslim.com. This is a group led by an American Muslim in New York. He's known to be an Al Qaeda sympathizer, and he supports Osama bin Laden and also supports a tax on Americans overseas. Our CNN's Drew Griffin did a special report on this just last year.
Now, back here at the house, neighbors again say that she had a boyfriend that lives with her. In fact, they say that he still lives here. A man with those initials shows up in an indictment that was released yesterday, and prosecutors say a man with those initials allegedly had his passport taken from him by the woman known as "Jihad Jane" to supposedly give to, quote, "the brothers" to help them overseas. And as Jeanne pointed out again, this woman is not here right now. She has been in detention since last October in Philadelphia, and an arraignment is expected in about a week's time. Kiran, back to you.
CHETRY: Wow. Susan Candiotti for us with new details this morning. Thank you.
ROBERTS: Also new this morning, we brought you his chilling story yesterday. Now we have the 911 call from a driver inside a runaway Toyota Prius on a busy California freeway speeding up to 90 miles an hour.
(BEGIN VIDEO CLIP)
911: How fast are you going?
DRIVER: 80 something.
911: You're going 80 miles an hour.
DRIVER: 81 now.
911: 81? And it's still stuck?
DRIVER: Yes. (END VIDEO CLIP)
ROBERTS: The driver, Jim Sikes, said the floor mats did nothing to cause the problem. He told the operator he was afraid to put the car into neutral. That car reached 94 miles an hour before a patrol officer helped slow it down and turned off the engine. Toyota and the National Highway Traffic Safety Administration sent investigators to look into the case.
CHETRY: There's also another claim this morning of a runaway Toyota, also a Prius. This one in Westchester, New York, just outside the city. Police say the woman's car shot out of her driveway across the street and then blasted through a stone wall. They're also saying that the floor mat probably didn't have anything to do with it. The 56-year-old driver was hospitalize, but her injuries are not believed to be life threatening.
ROBERTS: A New Jersey man, you remember him, who breached security at Newark airport by ducking under a rope to kiss his girlfriend has pleaded guilty to a charge of defiant trespass. Haisong Jiang will have to pay a $500 fine and court costs, along with performing 100 hours of community service. The January incident shut down part of the airport for six hours, forced thousands of passengers to be re-screened and triggered a five-day manhunt.
CHETRY: A guilty plea from former CBS News producer, the one accused of trying to blackmail David Letterman. Robert Joel Halderman will serve six months in jail. He'll also have five years probations and have to do a thousand hours of community service. The former "48 Hours" producer pleaded guilty yesterday to that charge of attempted second degree larceny. Halderman has admitted trying to extort $2 million from Dave Letterman to keep quiet about his sexual affairs with staff members.
ROBERTS: Well, we've got seven-and-a-half minutes after the hour now and time for a quick check of this morning's weather headlines. Rob Marciano is in the weather center in Atlanta. Good morning, Rob.
ROB MARCIANO, AMS METEOROLOGIST: Good morning, John. Good morning, Kiran. We're looking at some rain across parts of the southeast. It's going to be a precursor of some storms that will last, well, on and off for the next 2 1/2 days.
Here's a look at radar. Some heavy rain actually will slow things down in Atlanta not only on the roadways but on the airways as well. Some of these thunderstorms containing rain that will cause some short-term flooding at least in some of the city areas. And the wider scope showing a more complex system that's going to bring a second punch of energy.
Once we get through the rain this morning across the southeast, the threat for severe weather does exist across the mid-Mississippi Valley all the way down to the gulf coast. Later on this afternoon, Arkansas especially could see the roughest amount of weather and we'll see. We'll keep you updated on that as it develops throughout the day today. Much more weather, guys, in about 30 minutes. We'll see you then.
CHETRY: Rob, thanks so much.
And still to come on the Most News in the Morning, resigning under a cloud of an ethics investigation. Now, Congressman Eric Massa is responding to the charges that he lashes out at his Democrat party leaders.
It's eight minutes after the hour.
(COMMERCIAL BREAK)
CHETRY: Welcome back to the Most News in the Morning. It's nearly 12 minutes past the hour right now.
It seems that the more former New York Congressman Eric Massa tries to explain why he resigned this week, the more confused those listening seem to get. Was it his health? Was it a Democratic setup? Or was inappropriate contact with his staff?
Massa went on TV last night to set the record straight but his interviews, including one with Larry King, only raised more questions about his departure. Brianna Keilar is live in Washington now with more on this continuing saga, I guess you could say. Hey, Brianna.
BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: Hi, Kiran. You sort of wonder where to start because honestly, the water cooler fodder here is just endless. But why don't we begin first with Massa's response to the news that broke yesterday. It was "The Washington Post" that first broke that Massa was under investigation for allegedly groping male staff members. So earlier in the day, Massa said on a different network that yes, he did grope but he said it wasn't sexual. And here's what he said to Larry King.
(BEGIN VIDEO CLIP)
LARRY KING, HOST, "LARRY KING LIVE": You acknowledge that at your 50th birthday party you groped a male staffer. What is this all about?
REP. ERIC MASSA (D), NEW YORK: Well, when four guys jump on you to wrestle you, to prove that you're 50 years old, anything can be called anything, Larry. And what it's all about is innuendo.
KING: You said, quote, "Not only did I grope him, I tickled him till he couldn't breathe and then four guys jumped on top of me." So you did grope someone. Right?
MASSA: Larry, when you grab someone and you're wrestling, I don't know how to describe that word. So if that's the word that you want to have an entire debate about, then I can't stop you.
KING: No, I'm just asking -- you said you groped someone.
MASSA: Yes.
KING: A lot of people associate groping with sexual.
MASSA: Well, it wasn't sexual. Period.
KING: OK.
(END VIDEO CLIP)
KEILAR: Now, remember when it first broke last week, that Massa was facing an ethics inquiry, he said over the weekend that he was at a wedding. People were drinking. His staff members were there, and he said something really inappropriate and he tousled someone's hair. So that was the first thing we heard. And then this is really the second thing yesterday, this tickling or this wrestling, Kiran.
CHETRY: So -- but in the end, he also talked about having to deal with health issues and, you know, some of the Democratic leadership are saying this is a very sick man, meaning physically sick. So was he pushed out? Did he decide to resign? And how did health care get into this you know, at all?
KEILAR: You know, we got a little bit of everything on this. Last week, he said he was retiring because of a health issue. But also said that he had used inappropriate language, salty language as he called it, and he said he took full responsibility for that. And over the weekend he said connect the dots. I was going to vote against health care, and he really seemed to say that he was forced out, certainly by Democratic leaders.
Yesterday, he kind of said both. Early in the day he said, I was not forced out. Then when Larry really pushed him on this, he seemed to kind of go back in that direction saying he bucked his party, and when you buck your party, you do get pushed out. So we got a little bit of everything.
CHETRY: All right. Brianna Keilar for us. It's an interesting story, how it affects, you know, the halls of Congress. We're going to talk about that a little bit later. Thanks so much.
ROBERTS: Wow.
Other stories new this morning. New information on that shooting at Ohio State University that broke right here on AMERICAN MORNING yesterday. Police say a janitor entered a campus maintenance building, shot two supervisors and then himself because he knew that he was going to be fired. Managers complained that Nathaniel Brown did not follow orders, he was late and that he slept on the job.
CHETRY: Hundreds of construction workers holding a rally at Ground Zero, demanding that authorities speed up the rebuilding effort. A standoff over the financing between a developer and the city have now delayed construction again at the World Trade Center site.
A new rebuilding schedule is due Friday, one lawmaker telling the crowd instead of a symbol of American resilience, we still, after all these years after 9/11, have, quote, "a hole in the ground." ROBERTS: And experts say minority babies now make up about half of all U.S. births. A report out today suggested 2010 may be the tipping point when minority births outnumber Caucasian births. Demographers believe the large number of Hispanics immigrating to the country is one reason minorities will become the majority within 40 years.
CHETRY: We'll find more about that as we -- Christine told us those census forms are getting mailed out, reminders that you got to fill that out so they know more about the population.
ROBERTS: Did you get your reminder about the census coming?
CHETRY: I did (ph). Did you?
ROBERTS: Yes. Got that in the mail.
CHETRY: Yes. There you go.
ROBERTS: Why don't they just send the census? Why do they need a reminder, too? You know, how much money is it costing to send the reminders?
CHETRY: They need to give the -- they needed (ph) to give the post office some business. Remember, we talked about that, too.
ROBERTS: That's true.
CHETRY: You could use that (INAUDIBLE).
ROBERTS: It's kind of robbing Peter to pay Paul, though, isn't it?
CHETRY: Yes. A little bit.
Well, it's 16 minutes past the hour. We're going to take a quick break.
When we come back, good news for people looking for a job. The openings, job openings, are actually up. Christine Romans "Minding Your Business" next.
(COMMERCIAL BREAK)
ROBERTS: Checking stories new this morning, the CEO of Continental Airlines says his company has a plan to avoid new federal fines for delaying passengers -- they'll just cancel flights.
The new fine that are meant to keep you and me from sitting on planes for hours without taking off, Continental is blaming out of date air traffic control equipment for the problems. The Transportation Department responded, saying Continental should do a better job of scheduling flights and crews.
CHETRY: Wow. Amazing. Well, tabloid celebrity Lindsay Lohan is suing E-Trade, saying one of its commercials -- you remember the one that debuted during the Super Bowl? -- is taking a shot at her. It's the ad where one of the company's talking baby's "friend" is saying that, there's a -- that milkaholic Lindsay, and she claims it's a swipe at her.
See what you think.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: And that milkaholic Lindsay wasn't over?
BABY FRANK: Lindsay?
BABY LINDSAY: Milk-a-what?
(END VIDEO CLIP)
CHETRY: Well, the tabloids have thoroughly reported Lohan's drug problems, stints in rehab, other problems, and Lohan's lawyer argues that, quote -- that, "Lindsay" -- the name, itself -- "essentially I.D.s" her client, "as in Oprah or Madonna."
That's a stretch, but -- I didn't even think. I mean, when -- when the --
ROBERTS: I mean, the words -- the words get over yourself come to mind --
CHETRY: Oh, yes.
ROBERTS: -- maybe.
CHETRY: Did you even think for a minute Lindsay Lohan when you saw that ad?
ROBERTS: No.
CHETRY: No.
ROBERTS: I've never known Lindsay Lohan to drink milk. I'm sure she does, I just haven't heard about it.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: (INAUDIBLE) more attention to her reputation. Lindsay Lohan is --
CHETRY: Right.
ROBERTS: Christine Romans here now "Minding Your Business."
ROMANS: I am.
ROBERTS: And that old song comes to mind, "Where the jobs are."
ROMANS: Yes. Well, the jobs are there. There are some jobs, believe it or not. There's a -- there's a survey that we talked -- looked at from the Labor Department called Job Openings and Labor Turnover Survey, and it shows that in January things got a little bit better.
There were 193,000 increase in job openings to 2.7 million job openings by the end of the -- by the end of the month. That sounds good. It's an improvement, yes.
Compare that to December 2007, of course, we have 4.4 million job openings at the end of January. Go over back to 2005, we have 5.6 million job openings. Still not a healthy labor market, but it is healing, as Christina Romer from the -- from the president's team has -- likes to say.
The available jobs today, candidates per job -- remember how we've been saying there are five people competing with you for every job? There's six, you know, workers for every job opening? It shrunk a little bit. It shrunk just a little bit to more like 5.5, and that compares to 1.7 -- 1.7 in December 2007.
So, look, it's still not a healthy labor market, but you're competing with half of -- less person for that job.
CHETRY: Where are these jobs?
ROMANS: The jobs are in education and heath care. They created about 13 percent more of those jobs in January. They're in hotels and restaurants. And economists say, you guys, that that shows that there's a little bit of confidence building, when you're putting -- when you're putting people to work in hotels and restaurants, that shows that the -- the consumer is at least not as freaked out as they were before.
The job losses are in arts and entertainment and in government, believe it -- governmental jobs. They've been such -- creating so many jobs in government that to have a little bit less there is not really that much of a surprise to me because it's been such a big driver.
ROBERTS: Christine Romans, "Minding Your Business" this morning.
ROMANS: Yes.
ROBERTS: Thanks, Christine.
ROMANS: Sure.
ROBERTS: Twenty-two and a half minutes after the hour. We'll be right back.
(COMMERCIAL BREAK)
ROBERTS: Coming up now to 26 minutes after the hour. We're back with the Most News in the Morning, and it's time for an "A.M. Original", something that you'll see only on AMERICAN MORNING.
If you're finding it hard to stomach what's happening in Washington these days, you're not alone. It seems more politicians than ever are just hopelessly out of touch. Let's face it, the government, as many people say, is broken, and we don't exactly have a great track record when it comes to electing the right people to run the country.
So Carol Costello was wondering if maybe it's time to tweak the system.
(BEGIN VIDEOTAPE)
HIRAM MONSERRATE, FORMER U.S. SENATOR: I am taking this opportunity to officially announce my candidacy for the return of State Senator Hiram Monserrate.
CAROL COSTELLO, CNN CORRESPONDENT (voice-over): A typical political campaign wish, unless you know the back story. Hiram Monserrate was actually booted out of the New York State Senate after he was convicted of a misdemeanor for assaulting his girlfriend.
Part of the attack was captured on an apartment surveillance tape, yet Monserrate is positive voters will re-elect him.
Tuesday, he announced he's running on a Yes, We Can ticket. And to his critics in politics?
MONSERRATE: I think it would be the pot calling the kettle black for anyone in government in the Albany (ph) pointing a finger towards Hiram Monserrate.
Thank you very much, sir, for all your support.
UNIDENTIFIED MALE: No problem. No problem.
COSTELLO: Some political observers are aghast but not surprised.
UNIDENTIFIED MALE: They're very quick at justifying actions that most of us would have to apologize for.
COSTELLO: And rarely do they just go away after justifying their actions.
South Carolina's governor admitted to an affair, to lying to voters, but he has resisted calls to step down, confident of voter support.
GOV. MARK SANFORD (R), SOUTH CAROLINA: I'm not going to be railroaded out of this office by political opponents or folks that were never fans of mine in the first place.
COSTELLO: It's a battle cry long echoed by U.S. Congressman Charlie Rangel, who's accused of failing to pay taxes and violating House ethics rules.
CONG. CHARLES RANGEL (D), NEW YORK: In order to avoid my colleagues having to defend me during the elections --
COSTELLO: He finally stepped down as chairman of a powerful committee --
RANGEL: Stop the thievery --
COSTELLO: -- but the congressman, elected 20 times, did not apologize or resign.
Gut check -- is it time to tweak the system?
UNIDENTIFIED MALE: The average voter would love to see through the persona projected by the consultants in the TV ads, but how do you do that?
COSTELLO: More politicians. Example, right now each member of the U.S. Congress represents roughly 700,000 Americans, far too many voters for their elected representatives to get to know. So, instead of 435 House members, why not elect 10,000?
UNIDENTIFIED MALE: The smaller the unit is, the more likely it is that people will get to know the candidates and they'll vote not just on the basis of party, but on the basis of the character of the candidates.
(END VIDEOTAPE)
COSTELLO: Imagine you actually meeting the person that you elect to office.
Some of you may scoff at the thought of electing 10,000 members of Congress, but, the idea of keeping a representative constituency rather small actually came from George Washington himself, because he foresaw the reality of what we're dealing with today, John.
In other words, he thought that -- that a representative should represent no more than, let's say, 50,000 people. So maybe it's time to re-assess. Maybe it is time to tweak.
ROBERTS: Well -- the country was a lot smaller back then in the days of George Washington.
COSTELLO: No, but -- but he -- he foresaw its growth, and it's actually in the Constitution that maybe representatives or lawmakers should reassess things as the population grows and kind of adjust.
ROBERTS: I wonder if he -- he foresaw the growth of the budget, though, and the budget deficits and the -- and the debt and how you're going to pay for 10,000 members of Congress. My goodness.
But if such a tweak happens. If they were to reduce the size of the constituency that a congressman or a congresswoman represent, it's going to be a long way off. So anything else that voters can do in the interim?
COSTELLO: Well, actually, I did talk with two psychologists who specialize in politics. They told me if a politician is unable to be reflective, which means you have to actually watch the politician's speeches while they're running, if he or she has this inability to be reflective or to admit he or she was ever wrong about anything, or if they refuse to apologize for any wrong at all, it's probably not a good idea to vote for these people.
Or if you have voted them into office, please, please don't do it again.
ROBERTS: All right. Carol Costello for us this morning -- Carol, thanks very much.
And what do you think --
COSTELLO: And I --
ROBERTS: Go ahead.
COSTELLO: Should I mention the blog?
ROBERTS: I can do that or you can do it. Go ahead.
COSTELLO: I'd like to know what you think about this -- CNN.com/amFIX. That's CNN.com/amFIX. Is it time to tweak the system? Do you think electing more politicians is the answer? I love to hear what you think this morning.
ROBERTS: I wonder what the answers are going to be, Carol. I mean, I'm just taking a guess this morning.
(LAUGHTER)
CHETRY: If one person says, "Yes, we should elect more people." Get that one on the air because I don't think you're going to see many of those, Carol.
ROBERTS: Thanks, Carol.
We're crossing the half hour. That means it's time for this morning's top stories.
A suburban Philadelphia woman who authorities say calls herself "Jihad Jane" has been indicted on charges that she conspired to support foreign terrorists. Colleen LaRose is also accused of plotting to kill a Swedish cartoonist who drew controversial images of the Prophet Mohammad. Irish authorities also say they arrested seven people who are suspected of plotting with LaRose to attack that cartoonist.
Former New York Congressman Eric Massa says he never grope or sexually harassed a male staffer, insisting he resigned for two reasons. "A," a possible recurrence of cancer and, "B," the Democratic Party that forced him out because of his stance against health care reform. The embattled Democrat appeared on CNN's "LARRY KING LIVE" last night. The White House calls his claims, quote, "crazy."
And Toyota is now investigating two new reports of sudden acceleration. One, a Prius driver who hit 94 miles an hour on a San Diego freeway; the other, a New York woman who lost control of her Prius and smashed through a stone wall when it suddenly accelerated -- Kiran.
CHETRY: John, thanks.
Well, more than 11 million people in this country are currently collecting unemployment. That price tag is $10 billion a month. Six million Americans have been out of work since September. But today, the Senate is likely to pass another jobs bill that could ease some of the pressures of the recession, extending benefits up to 99 weeks.
How much would that cost? $66 billion. And it's adding to the fiery debate over how to get our $12.5 trillion debt under control, at the same time acknowledging that these are very tough times for people who don't have a job.
Here to break it all down in Washington for us, Pete Morici, professor of international business at the University of Maryland.
Great to see you this morning.
PETER MORICI, PROFESSOR, UNIVERSITY OF MARYLAND: Nice to be with you.
CHETRY: Also with us here in New York is our own Christine Romans.
Thanks to Christine as well for jumping in on this.
First of all, since the program's inception, of receiving employment benefits, we haven't seen anything as long as 99 weeks. They're calling this unprecedented. What's going on?
ROMANS: Well, look, usually 26 weeks, and it's state-funded. It's administered by the state, 26 weeks of unemployment benefits. Now, you can get up to 693 days of receiving unemployment benefits by the government. The idea here is that, frankly, the economy is so fragile and so many millions of people, Kiran, are out of work, that they have to do something to stop the bleeding with the labor market.
The big question now is, OK, maybe that's the right thing to do now and during the recession, but at what point do you have an exit strategy? Because -- are you going to be a country that's going to keep putting a band-aid on the labor market instead of fixing the labor market? Because that's what jobless benefits are. They are band-aid to help people through. They're not actually out there getting that person work.
So, you know, 693 -- 99 weeks on unemployment benefits is an incredibly long time and people are starting to ask the question now: when are we going to pull back from that and how are we going to that? Or some progressive economists are saying, maybe we need to have -- this is going to be part of the new safety net for this new economy.
CHETRY: And what are the implications of that, Peter, as we look at this unprecedented extension after extension, 99 weeks -- almost two years for some people who are receiving unemployment benefits?
MORICI: Well, people start to view these benefits as a permanent part of the safety net and then they start to plan around them. During the Carter and Ford years, we had a job market similar to the one we are now entering, and people started abusing the benefits big time. They started basically losing their jobs almost on purpose so they could go to school. Or they could run -- we had one guy ran for public office on unemployment benefits. In Europe, what we found in the '80s was these kinds of benefits actually encourage unemployment.
CHETRY: Well, this is something that a few people have saying, we heard Jon Kyl talk about -- a Republican senator saying that perhaps this is a disincentive, but then we talked to people like the woman we had on our program last week who said, listen, I sent my resume everywhere, I've been looking for a job.
ROMANS: Right.
CHETRY: I've run the gamut from what I did do to trying to get a job at Starbucks or McDonald's and I can't get a job.
ROMANS: Look, I think that most people don't want to say -- hey, unemployment benefits. Great. This is exactly how I'm going to, you know, propel my family into the middle class.
I mean, I think that for many people -- I mean, I talked to a guy just the other day who's using his unemployment benefits to pay his mortgage. So, that's the economic benefits to the whole neighborhood of this guy getting unemployment benefits. He was still able to pay his mortgage.
There's a guy in the University of Chicago, Robert Shimer, who's actually said that one to one and a half percentage points of the unemployment rate is exactly as Peter Morici says, it's because people are less likely to go out and retrain or to take a job that's below their qualifications and stuff because they have such long unemployment benefits.
But for the most part, economists are telling me that there is a 40 percent long-term unemployed who are on these long benefits, but most people -- I mean, the average length of unemployment is 280 days. Not 693 days.
CHETRY: Right.
ROMANS: Most people, the average duration is much shorter than the unemployment benefits that we're giving.
CHETRY: And, Peter, this morning, Robert Shimer, who's also one of your colleagues, he's an economics professor at Chicago, said he believes that these unemployment benefits are subsidizing unemployment and that it's having a pretty substantial impact on the jobless rate. What do you think?
MORICI: Well, I absolutely agree. You know, put this in perspective. We're going to spend more than 1 percent of GDP on jobless benefits with this new extension. That's an absurd amount.
That 1.5 percent he talks about is the beginning. It is going to grow from there. It becomes a way of life.
It almost becomes like the old welfare problem and that people just never pull themselves up, that they just become residing to the fact that they're going to be on unemployment for a very long periods of time. Also, the administration uses this instead of taking the very strong substantive steps it needs to take to create a viable job market -- namely, fixing the regional banks and fixings trade deficit which is the reason there's not enough work in the United States. Businesses don't have enough capital or customers.
ROMANS: But, Peter, this has put money right into the economy though. I mean, just like this guy I was talking to this week who was paying his mortgage with it. Doesn't -- jobless benefits, isn't it a quick way to get money moving through the economy?
MORICI: Well, you could say that. But you also could set the retirement age at 60 instead of 65. Think about the long term structural problems that would create. Not paying people to work is a short term palliative. It doesn't help the economy grow long term. And in the end, there will be a smaller part to divide, and everybody will be worse off.
CHETRY: What about the news today that Christine talked about be in her "Minding Your Business" segment of last block, about the fact that there are now more jobs? I mean, not compared to 2007, as you pointed out, but there are more jobs out there right now. Are we seeing this turnaround, the unemployment rate and the fact that there have been 40 percent of people looking for a job for more than six months?
MORICI: The economy is recovering. We've likely hit bottom on the job losses. However, we're not going through a period like the period after the oil embargo through the mid-80s, where there's going to be a lot of under employment. People are going to be finding unsatisfactory jobs.
The English major that works 40 hour a week, but now, that student has graduated and driving a cab; a PhD is driving cabs -- were very common in the late '70s and early '80s. We're going to go through a lousy job market where people are grossly underemployed until we get at the root causes of slow growth in the United States.
The U.S. economy is downsized by about 9 million jobs. And now, we're looking at adding 1.5 million jobs a year --
CHETRY: Right.
MORICI: -- which is barely enough to keep even with new high school graduates.
CHETRY: Right.
MORICI: We need to do something to lift the economy parametrically.
CHETRY: All right. Last word, Christine, quickly -- what happens when these unemployment benefits run out? These extensions aren't going to go on forever.
ROMANS: No. They're not going to go on forever for some people. And people are rolling off of these right now frankly and they're going to have to either find a new job. They're going to take a job below their skill set. They're going to have to cobble together freelance work or contract work.
I mean, it's really, really tough out there. And even when we talk about job openings perking up a little bit, I want to be clear, you know, there are a lot of people who have been long term unemployed. And we -- as a country, we have to figure out what to do about it.
CHETRY: Christine Romans, Peter Morici -- always great to talk to you as well. Thanks so much.
MORICI: Take care.
CHETRY: John?
ROBERTS: Coming up on the Most News in the Morning, a loud rally, public arrests and wanted posters. It was the scene outside of a health insurance conference. Is the health care debate getting out of control?
It's thirty-eight-and-a-half minutes after the hour.
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CHETRY: Welcome back to the Most News in the Morning. It's 41 minutes past the hour right now.
President Obama, as we know, is rolling up his sleeves, hitting the streets, talking up his final push for health care reform. Meantime, thousands rallied in Washington against what they call "insurance industry bullying."
ROBERTS: They were there to make a mass citizens' arrest.
Our Jim Acosta is live in Washington for us this morning.
Jim, you're awfully familiar with the health care debate. You've done a lot of coverage.
JIM ACOSTA, CNN CORRESPONDENT: Yes.
ROBERTS: This was one for the book, wasn't it?
ACOSTA: It got a little wild out there, John and Kiran, and the health care advocates and labor groups who staged this rally, they wanted the health insurance industry to learn one thing at their conference this week -- running out of space inside a big luxury hotel doesn't mean you can keep the reform debate from getting really loud.
(BEGIN VIDEOTAPE)
(CHANTING)
ACOSTA (voice-over): The swarms of protesters marching through the streets of Washington in favor of health care reform wanted to do more than just make some noise.
RICHARD KIRSCH, HEALTH CARE FOR AMERICA NOW: Are we going to arrest these corporate criminals?
CROWD: Yes!
KIRSCH: Are we going to send them packing?
CROWD: Yes!
UNIDENTIFIED MALE: Now, raise your right hand, and repeat after me --
ACOSTA: The organizers of the rally informally deputized the crowd to make a citizens' arrest of the executives of several major health insurance companies. Then carrying Wild West-style "wanted" posters showing the faces of insurance companies' CEOs, the protesters trying to push and shove their way inside this ritzy hotel, that's where the industry was holding its annual policy conference.
(on camera): Where we're standing right now is where the protesters are actually trying to enter the conference that the insurance industry is holding right here in Washington. Police are standing in the way trying to hold back what is a massive crowd.
(voice-over): Police did grab about a few protesters but released them minutes later.
The insurance industry spokesman said he's seen these tactics before.
(on camera): Do you think this is getting out of control when you see "wanted" posters for insurance companies' CEOs? Isn't that getting out of control?
ROBERT ZIRCHELBACH, SPOKESMAN, AMERICA'S HEALTH INSURANCE PLANS: You know, we don't pay a lot of attention to all the different things that people are posting on Web sites and on the blogs, and the different attention. You know, we're focused on what we can do as an industry to make the health care system work better.
ACOSTA (voice-over): Not everybody at the conference was from the industry. Health care expert Mark Pauly said the current reform bill before Congress would actually be better than nothing.
MARK PAULY, WHARTON SCHOOL OF BUSINESS, UNIV. OF PENNSYLVANIA: A better attitude is probably to pass something and fix it up later. Although --
ACOSTA (on camera): It's not the perspective of the folks who are running this conference.
PAULY: I guess not. I mean, it's gotten to the point where it's a dear thing I think, whether it be better to scrap it and start over. But I'd be willing to work with anything.
ACOSTA (voice-over): Among the demonstrators, 10-year-old Marcelas Owens was protesting for his mother who he says lost a battle with a lung condition that got worse right after she lost her job and her health insurance.
(on camera): Does any of it make any sense to you?
MARCELAS OWENS, HEALTH CARE REFORM ACTIVIST: Not really, because my mother, she was sick -- and she was sick to the point that she should have gotten the medical attention even if she didn't have health care or not.
(END VIDEOTAPE)
ACOSTA: Brave young man there.
And the insurance industry is well aware that Congress is closing in on a vote on health care. The closing session at the industry's conference this week is on public opinion on reform.
John and Kiran, they are well aware that the Congress is closing in on what is a very crucial vote.
CHETRY: All right. Maybe we'll see more protests like that one.
ACOSTA: And we will later today. We're expecting a week of this stuff here in Washington. So, fasten your seat belts.
ROBERTS: All right. Jim, thanks so much for that.
Rob Marciano is going to have this morning's travel forecast right after the break.
CHETRY: And coming up in 10 minutes: do you ever wonder what happens when you hand over the keys to your car for the valet parking? Just wait until you see this one. Jeanne Moos -- coming up.
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ROBERTS: Good morning to Raleigh, North Carolina which Forbes Magazine says is the most wired city in America. It's 49 degrees right now.
CHETRY: You mean, they drink the most coffee?
Wired in the morning!
ROBERTS: Connectivity there. Later on today, 66 degrees cloudy with rain. The most wired city in America. So, it means you can probably get on the Internet without any problem.
CHETRY: I got you --
ROBERTS: Some places where I've been was like --
CHETRY: Although, sometimes, we're the most wired city in America because we have the 24-hour Starbucks.
ROBERTS: We're definitely the most wired program.
CHETRY: That's true.
ROBERTS: Welcome back to the Most News in the Morning. It's forty-eight-and-a-half minutes after the hour. It's time for your AM House Call, stories about your health. They're popular. They allow parents to strap babies to their chests, but the government needs preparing the issue a general safety warning about baby slings saying they can cause babies to suffocate. Officials say the slings have been linked to at least seven infant deaths.
CHETRY: Also, we're going to get a check of this morning's weather headlines. We turn to Rob Marciano in the Extreme Weather Center. What a pretty sunrise -- I'm looking right there. Look, just please, go back to the -- oh, there you are. I looked over there, and there was an empty chair, I thought, wow.
ROBERTS: Rob was looking at the window checking on the weather.
CHETRY: Hey, Robbie.
ROB MARCIANO, AMS METEOROLOGIST: No camera.
ROBERTS: That's how we do it.
MARCIANO: Hey, good morning, guys. You know, if I had a window to see a sunrise, I could tell you, but I don't. I can tell you this, though, when I came into work early this morning, it was raining pretty good outside in Atlanta, and that's one of the sore spots of the country weather wise.
A big area of really disturbed weather. A kind of complicated scenario setting up. What it means is a good third of the country really is going to be in rather unsettled whether here over the next 48 hours or so. Very unsettled across North Atlanta, north west of the city, and some of the suburbs there. Smirnoff throughout Marietta. You're going to see some heavy rain this morning, and it's going to last right on through the afternoon, so we wouldn't be surprised to see some flooding puddling on the roadways and that will slow down traffic for sure.
All right. New York and Boston, another day, maybe two days of nice weather. What's coming to D.C., probably isn't going to rip the ground too much, certainly not up in Philly and New York, so enjoy the stuff. Temps will be in the mid upper 50s again today and no expected delays at least at the New York airports. Atlanta, Charlotte because of the rain, and Chicago, Minneapolis and Houston, because of some low clouds and a little bit of rain as well.
But after the rain pushes through the southeast today, we will get another threat pushing severe weather as some energy comes out of the plains, and Arkansas through parts of Mississippi and Louisiana this afternoon and tonight, we could see some rough stuff, so we will keep an eye on that. John and Kiran, back up to you.
ROBERTS: Rob, we will try to get you a window, okay?
MARCIANO: Please.
ROBERTS: All right. Ten minutes to the top of hour. We'll be right back.
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ROBERTS: The things you could say.
CHETRY: Oh, but you just can't. A shot in the control room this morning. The control room.
ROBERTS: It's kind of an oxymoron, isn't it?
CHETRY: I'm not even to go there. I'm just going to say it's 54 minutes past the hour. It's time for the Moost News in the morning with Jeanne. So, when you hand over your keys to the valet parking, sometimes I just cross my fingers and hope for the best, right?
ROBERTS: Yes. You never know what could happen. You're hoping that there are no scratches. No dents in the car when it gets back, but as Jeanne Moos shows us, that may be the least of your worries.
(BEGIN VIDEOTAPE)
JEANNE MOOS, CNN CORRESPONDENT (voice-over): When you park, this is how you want the attendant to drive your car.
But this is how it was done -- at a St. Louis garage, at a Hyatt hotel, no less. It was like valet choreography. Valet cinematography. Under the name ValetUnderground it was posted on YouTube. Got rubber? And then later removed. But it's hard to remove this from your mind.
MOOS (on-camera): It's enough to give you the dreaded valet phobia.
MOOS (voive-over): Like in "Ferris Bueller's Day Off" the attendant took the car then took it for a joy ride. Pretty soon it was airborne. We saw no airborne cars at the Hyatt garage. And the valet parking company in charge there at the time has since been replaced though apparently not on account of this. It turns out there are similar valet stunts on YouTube. This one entitled "Don't Tip a Dollar at Yankee Stadium."
UNKNOWN MALE: Unbelievable.
MOOS: Actually, Tom Cortazy (ph) believes it. Back in his college days, he used to valet park in Washington, D.C.
UNKNOWN MALE: Except the guys I worked with were either drunk or high.
MOOS: And those guys sometimes took the cars for joy rides; out on the highway.
UNKNOWN MALE: One of our guys actually hit a person, smacked right into a pedestrian.
MOOS: Tom's advice --
UNKNOWN MALE: Ever since I valet parked, I tell all of my friends and family, just don't do it.
MOOS: But if you do, check the mileage before and after, and tip. $5 ensure that there will be no joy ride?
UNKNOWN MALE: That's right.
MOOS: That's five bucks per attendant on duty.
UNKNOWN MALE: It's extortion.
MOOS: Or maybe distortion. Tom remembers one valet.
UNKNOWN MALE: Who had eaten mushrooms. Psychedelic mushrooms before driving a car. That I can't even begin to imagine what the hell that's like.
MOOS: We can only imagine that mushrooms and doughnuts don't mix.
Jeanne Moos, CNN, New York.
(END VIDEOTAPE)
ROBERTS: What kind of people was that Tom hanging out with?
CHETRY: I know, right. He goes an alley. I just can't imagine but that would be a good five bucks well spent, right? To ensure that your car is not getting hit doughnuted around Yankee stadium.
ROBERTS: If you can ensure that, yes. Or that is just, you know, brink the clunker.
CHETRY: Yes, or take the subway. Three minutes on the top of the hour. We have your top stories coming up. We'll be right back.
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