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State of the Union

Interview With Lawrence Summers; Interview With Michael Oren

Aired April 04, 2010 - 09:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

CANDY CROWLEY, CNN ANCHOR: A funny thing happened on the way to health care reform. People were worried about something else. We asked, what was the most important issue facing the nation? For every one American who said health care, three said the economy.

Still, for more than a year, health care was the never-ending story. And while we were watching, something big was happening elsewhere. That's where we'll start.

The booming Clinton economy of the late '90s gave the Democrats the edge on the perennial question of which party would do a better job of handling the economy. In 2006, by a huge 54 percent to 35 percent margin, people believed the answer was Democrats. And as bad as things were last summer, people still believed that the bad economy was Bush's economy.

But by this week, Democrats lost their edge. Despite an encouraging employment report, Republicans are now seen as the party best able to deal with the economy. If people vote their pocketbooks this November, Democrats have a lot to worry about.

I'm Candy Crowley, and this is "State of the Union."

(BEGIN VIDEO CLIP)

CROWLEY (voice-over): This morning, one of the president's top economic advisers, Larry Summers.

Then, worsening tensions between the U.S. and Israel with Ambassador Michael Oren.

And the winners are Duke and Butler. But how many of today's heroes will get a degree? Georgetown coach John Thompson on whether you can win and graduate your players.

(END VIDEO CLIP)

CROWLEY: We start with Friday's news, the best jobs report in three years, and that's the other funny thing that happened along the way. As employment and other economic figures have gotten a bit better, the president's own figures have gotten a lot worse. Watch what happens from last April to this.

(BEGIN VIDEO CLIP) OBAMA: We've been through the worst period of economic turmoil since the Great Depression. I've often had to report bad news during the course of this year, measures that were necessary, even though sometimes they were unpopular, that the worst of the storm is over, that brighter days are still ahead.

(END VIDEO CLIP)

CROWLEY: Worth noting that, in a little over a year, the president's approval rating has dropped 20 points, not unprecedented, but not great.

Joining us now is the director of the White House National Economic Council, Lawrence Summers.

Thank you so much for joining us.

SUMMERS: Good to be with you, Candy.

CROWLEY: Unemployment. You had some good employment numbers, but unemployment reminds at 9.7 percent. In the same year, two years ago, a little more than two years ago, we had a good employment number. It's being compared to the one now. But at that same time, unemployment was 5 percent, a little below. When will unemployment drop to 5 percent now?

SUMMERS: Oh, we've got a long way to go. We've inherited a terrible situation, the most pressing economic problems since the Great Depression in our country.

It is the president's preoccupation to put people back to work. That's what the Recovery Act was all about. That's what the legislation he signed into law, to give incentives to businesses to hire people who've been out of work was all about.

That's what the measures that we're waiting for Congress to act on, to channel credit to small business, to protect the jobs of those on the front lines, teachers and policemen, to make investments, are all about. There's a great deal we've got to do, and we've got to do it with all of the energy that we can, and that's our -- that's our preoccupation.

Even as we recognize that this is no time for anything other than dissatisfaction and action, we can also look at this Easter and last Easter. Last Easter, the economy was losing 600,000 jobs a month. Last year -- last Easter, our exports were collapsing. Last Easter, credit didn't exist for homeowners, for small businesses.

The trend has turned, but to get back to the surface, we've got a long way to go, and that's what we're fighting to do every day.

CROWLEY: Much more with one of the president's top economic advisers, Lawrence Summers, right after this.

(COMMERCIAL BREAK)

CROWLEY: We are back with the head of President Obama's National Economic Council, Lawrence Summers.

I want to try to press you a little bit on the unemployment numbers and play you a little something from one of your colleagues.

(BEGIN VIDEO CLIP)

GEITHNER: But the unemployment rate is still terribly high, and it's going to stay unacceptably high for a long period of time. It's going to take a long time to bring it down just because of the damage caused by the recession.

(END VIDEO CLIP) CROWLEY: So unacceptably high says to me it's unacceptable. So what is the administration planning to do to bring it down?

SUMMERS: First, we're implementing the Recovery Act, the most largest piece of employment legislation since the Second World War...

CROWLEY: But that's almost a year old.

SUMMERS: But it takes -- it takes time for it to implement. The number of projects in which we'll be investing in the first half of 2010 is nearly twice what it was in the second half of 2009, so it will gather force.

Second, new measures to provide incentives for businesses to employ people, such as the tax credit that I mentioned that waives the Social Security taxes and payroll taxes for employers who hire workers who are unemployed.

Third, further support to protect those who are on the front lines, teachers, policemen, and others in state and local governments.

Fourth, and absolutely critically, incentives for small businesses to expand. You know, if you look, there's a great recession everywhere. There's a quiet depression in small business and in some parts of this country, and we've got to make special efforts for them. That's what the president's proposed in terms of providing credit.

Fifth, we're supporting, providing incentives to create the new energy economy, whether it's energy efficiency, whether it's renewables. We took a start in the Recovery Act. We need to do more. And it will create hundreds of thousands of jobs, but Congress needs to act on those provisions.

That's how we get the economy going.

CROWLEY: Now, all...

SUMMERS: Then we've got to renew it for our future by building a much healthier foundation for future prosperity. That was why the health care legislation was so important. That's why reforming financial regulation and putting in place a set of protections that don't let the free market create the kind of disaster that it did two -- two years ago is so important. CROWLEY: Let me -- let me ask you, though, because all of these things that you've mentioned are things that we have known about that have either been in the pipeline for more than a year, when you talk about the stimulus program.

It seems to me that at 9.7 percent at this point, is there anything new that you can offer people now on unemployment that says, "And we're also going to do this"? Because you've shown no hesitancy to kind of move in when the car companies were failing or to help in Wall Street. What about this 9.7 percent? If it's unacceptable, shouldn't more be going on? SUMMERS: It is unacceptable, and we've put forth a whole set of proposals on which the opposition in Congress has not allowed them to pass. The House passed major legislation with the elements that I mentioned last December, and that legislation has not yet been able to pass the Senate. We are taking new steps almost every -- almost every week.

The president's -- the president's team is implementing a program that is providing for further assistance for homeowners to get our housing market unstuck by allowing provisions that mean that if you get unemployed, you don't necessarily face a -- face a foreclosure.

CROWLEY: Do you -- is the bottom line...

SUMMERS: We've committed to do much more to support exports, and that has emerged as a major focus of our diplomacy with other countries. We are not complacent. We are not standing still. We are fighting to implement the programs that have already been legislated; to legislate, to actually legislate the other programs that have been put forward...

CROWLEY: Is your bottom line...

SUMMERS: ... and to put forward new proposals.

CROWLEY: ... that you think Republicans are responsible for holding up new jobs?

SUMMERS: There are important steps, Candy, that would put more people to work, that would help small -- help small businesses...

CROWLEY: You just mentioned earlier that...

SUMMERS: ... get credit.

CROWLEY: ... that's been blocked.

SUMMERS: ... that are waiting on decisions of the Congress, and I can tell you that the majority in the Congress is ready to go on those pieces of legislation.

CROWLEY: But you think it's the Republicans blocking...

(CROSSTALK)

SUMMERS: I'm not, Candy, I'm not one to get into partisan arguments. We have our proposals. We are ready -- we are ready to go.

Look, this week, several hundred thousand people are going to temporarily be cut off from their unemployment insurance benefits.

CROWLEY: I want to ask you about that.

SUMMERS: That's because people -- that's because Congress didn't act to extend.

CROWLEY: Is it radical to want to have to find some way to pay for those unemployment benefits extension? Because that's what's holding it up, is that there is -- is the Republicans saying, OK, fine, this is important, but let's pay for it. Does the president believe that the extensions of unemployment benefits should be paid for?

SUMMERS: He believes that in an emergency, families who are depending on unemployment insurance to buy medicine for their kids should not have that unemployment insurance cut off.

CROWLEY: So it doesn't have to be paid for.

SUMMERS: We believe that we need to approach these issues in their totality, with a fiscal framework that assures that we are getting to a much lower budget deficit. Frankly, if the Congress were to act on the president's budget, we would have a much healthier fiscal situation than we do right now.

So in context of the president's proposals, we could have lower deficits, and we can protect people who need protecting, and we can put money into people's hands so that they are able to spend and push this economy forward.

CROWLEY: I just wanted to wrap up this point. So the White House believes that absent the totality of the picture -- of the proposals you're talking about, that it's all right to pass unemployment benefits though they are not specifically paid for?

SUMMERS: The White House believes in passing a program that will reduce the deficit and push the economy forward. That is what the White House has proposed. That is what the president spoke about in the state of the union address. That is what the president has asked for action on.

You know, sometimes there are tradeoffs and you have to make choices, but the president has shown how, by eliminating -- by eliminating programs, by allowing tax cuts that don't serve a valuable purpose for the highest incomes to phase out, by going after inappropriate tax shelters that benefit a quarter of a percent of the population, how we can reduce the deficit and engage in necessary spending to protect families.

Think about it. Unemployment insurance, a basic protection for people who have been laid off through no fault of their own, cut off because our politicians are not able to agree on a formula for extending it? That's not how our government should be working. CROWLEY: We're going to have more with Lawrence Summers in a minute. We want to ask him where all the manufacturing jobs have gone, right after this.

(COMMERCIAL BREAK)

CROWLEY: Before we continue, let's break down the long-term loss of manufacturing jobs. When the mall shelves are stocked with products marked "made in China," you might think, isn't anything made in America anymore? And the short answer is yes. Over the past 20 years, growth in manufacturing has risen steadily. It has gone from about $866 billion in 1987 to almost $1.6 trillion in 2008. Over the same period, employment within the manufacturing industry has trended down from a high of just over 18 million in March 1989, to recent lows of about 13.5 million in 2008.

American manufacturers are simply making more stuff with fewer people. Why is that? Mainly, it's productivity. Since 1987, productivity in the manufacturing industry grew by 103 percent. That's almost twice the rate of productivity in the rest of the business sector. Manufacturing technology accounts for a lot of that.

Another reason is global competition, which forces manufacturers to run at maximum efficiency, and that is how you've got a growing industry with a shrinking work force. Now, if they could only manufacture some jobs. We'll talk about this with Larry Summers in a moment.

(COMMERCIAL BREAK)

CROWLEY: We are back with Lawrence Summers, director of the White House National Economic Council. We want to talk about the long-term unemployed. The definition is on unemployment or unemployed for more than six months.

Something the Wall Street Journal brought up in a recent editorial, talking about the long-term unemployed. Nearly one of every two Americans who has lost his job is waiting at least half a year to get a new one. The damage in lost skills and human capital is enormous and can do life-long damage. Not just that people fall behind, but that skills, skill set that you have.

CROWLEY: What is done for these long-term unemployed? It's now about 44 percent of the unemployment figure, is long-term, and you add in others who are looking or dropped out or are part-time, we're up to 16 to 17 percent. What is in it for those who have been searching for so long?

SUMMERS: In this area, as in so many others, Candy, prevention is better than cure. Getting the economy going again, so firms don't have to lay off so many workers is the best...

CROWLEY: But we need a cure, don't we?

SUMMERS: ... is the best way to prevent new people from becoming unemployed. For those who are, this is why the president pushed so hard for an incentive program that gave a tax credit in the form of waiting (ph) the need to pay payroll taxes on any business that hired an unemployment worker -- an unemployed worker. Precisely so that these people would get hired before they were able to lose their skills.

This is why we think it's crucial that unemployment insurance be extended so people can be supported while they look for work, while they think about retooling their skills to adapt to a changing economy. We've got to have a platform in which people are protected if we want them to look for the new jobs, develop the new skills that are necessary.

That's why it's so unfortunate that unemployment insurance has not been extended. And that is why, because so much of this -- you had a segment just now on manufacturing, and it made the point that we've lost jobs in manufacturing.

CROWLEY: And they are not coming back, are they?

(CROSSTALK)

SUMMERS: In part because of productivity growth -- the best way to bring them back is to increase our competitiveness internationally. That means focusing on exports. That means standing up, as the president did, for U.S. producers, as he talks to other heads of state. That means getting rid of rules that don't work for our national security and prevent our firms from selling products when they could get big orders. That means insisting, as Ambassador Ron Kirk does, that other countries who have accepted obligations to the United States in international treaties meet those obligations. If we are able to double our exports in the next five years -- the goal the president has set for us as a country -- that will make a major contribution to jobs in the manufacturing sector, and in turn, to bringing back those who have been unemployed for a long time.

CROWLEY: Some of the impediments that are in making jobs, at this point, is that China's currency is so devalued that they can sell much cheaper than we can. Our goods are more expensive over there, their goods are cheaper over here, and yet the administration has decided to delay its report on who is manipulating their currency.

There is a legislation up there to label China a currency manipulator up on Capitol Hill. Is China a currency manipulator?

SUMMERS: You know, Secretary Geithner issued a statement describing our strategy yesterday. And what he made clear was that these issues of China and other countries of treating the United States as the ultimate importer and not taking our products, are issues that we are totally committed to addressing.

There are three major international economic summit meetings...

CROWLEY: Can I just ask you...

(CROSSTALK) SUMMERS: Let me just finish this thought. Including the U.S./China strategic economic dialogue, where we are going to be pursuing these issues with a great deal of vigor over the next several months. And after those meetings, I think we'll be in a better position to make recommendations, observe measurable progress, and set our course forwards.

CROWLEY: Right now, is China manipulating its currency at the detriment of U.S. jobs?

SUMMERS: You know, there are clearly crucial issues with respect to commercial practices in a number of countries, including China. Those were things the president took up at his first international meeting, the G-20 economic meeting in London. Since that time, our trade deficit has come down substantially, but no one can be satisfied with where we are ,and this is going to be a continued focus for us going forward.

CROWLEY: So it's not a good thing to say out loud, is what I take (inaudible)?

SUMMERS: We're focusing on increasing our new exports.

CROWLEY: OK. Thank you so much, Lawrence Summers.

SUMMERS: Thank you.

CROWLEY: Chief economic adviser to President Obama. Thank you very much.

Up next, we'll look at rising tensions between the U.S. and Israel with the Israeli ambassador to the U.S., Michael Oren.

(COMMERCIAL BREAK)

CROWLEY: Last week, we told you about Israeli Prime Minister Netanyahu's visit to Washington. This week, French President Nicolas Sarkozy came to call.

(BEGIN VIDEO CLIP)

(UNKNOWN): Ladies and gentlemen, the president of the United States and the president of the...

CROWLEY: The words and images were warm and fuzzy.

OBAMA: I am delighted to welcome my dear friend, President Sarkozy, to the White House.

CROWLEY: The French leader got royal treatment, a bilateral press event in the East Room, a private dinner with spouses, piles of praise.

OBAMA: Over the past year, the president and I have worked closely on numerous occasions. We respect one another and understand one another. (END VIDEO CLIP)

CROWLEY: Respect and understanding. Rewind to the Washington visit of Israeli Prime Minister Benjamin Netanyahu. On Capitol Hill, warmth, handshakes, smiles; at the White House, no pictures of Obama and Netanyahu, no joint press conference, no private dinner with the wives, and no words of praise.

A diplomatic diss? Not according to President Obama's senior adviser, David Axelrod, when we asked him last Sunday.

(BEGIN VIDEO CLIP)

DAVID AXELROD, WHITE HOUSE SR. ADVISER: This was a working meeting among friends, and so there was no snub intended. But sometimes, part of friendship is expressing yourself bluntly.

(END VIDEO CLIP)

CROWLEY: And by all accounts, there were blunt words exchanged behind close doors, but a quick scan through the White House photo gallery shows White House cameras were indeed allowed to capture a blunt talk between these two friends, but not this friend. He left through the back door without fanfare, his visit documented with this picture.

Joining me now is the Israeli ambassador to the United States, Michael Oren. Mr. Ambassador, thank you for joining us.

OREN: Good morning. CROWLEY: Can we get an update on what has happened? The big problem here has been that more Israeli units were announced, that they are going to put up in East Jerusalem. That is what the White House has been so upset about.

CROWLEY: Where are we on those negotiations? Is Israel willing to stop building?

OREN: Israel has a policy that goes back to 1967. This is not the policy of Benjamin Netanyahu. This is the policy of Golda Meir. It's the policy of Yitzhak Rabin, that is, that Jerusalem is the capital of the state of Israel. Under Israeli law, it has the same status as Tel Aviv.

And our policy is that every Arab, every Jew has a right to build anywhere in the city legally as they -- an Arab and Jew would have a right to build legally anywhere in a city in the United States, including in this city, in Washington, D.C.

That's our policy. The policy is not going to change.

CROWLEY: So (inaudible) change?

OREN: Not going to change, but we understand. We understand that Jerusalem is sensitive. We understand that the timing of announcements, such as the announcements of this particular project, should be under the control of the prime minister's office. It's not easy. The prime minister of Israel, he's not the mayor of Jerusalem. He's got a country to run. And he knows no more about what's being built on every street in Jerusalem than the president of the United States would know that's being built any, you know, city, any street in Washington, D.C., or New York.

CROWLEY: Well, that's a sensitive area. I mean, you understand why the United States thinks that this is unhelpful in trying to bring the two parties to the table. You understand that -- that the Palestinians lay claim to part of Jerusalem. Do you recognize that?

OREN: We understand that -- we understand that we have negotiated a peace treaty with Egypt, a piece treaty with Jordan. There has been 16 years of negotiations with the Palestinians, including two cases where Israeli prime ministers put complete peace plans on the table, including Jerusalem. And throughout that entire period of peace-making, Israel's policy on Jerusalem remained unchanged.

We feel that now we should proceed directly to peace negotiations without a change in policy. We understand that Jerusalem will be one of the core issues discussed in those peace negotiations, but the main issue is to get the peace negotiations started. We are waiting for the Palestinians to join us at the table. So far, they have not done so.

CROWLEY: I want to read you something from General David Petraeus. He was -- it was written testimony to the Senate Armed Services Committee. He was talking about the ongoing non-peace between Israelis and Palestinians when he said the conflict "foments anti-American sentiment due to a perception of U.S. favoritism for Israel."

So it is not -- this is a military man basically saying that the failure to find peace between the Israelis and the Palestinians is making Americans targets.

OREN: Well, I think that General Petraeus has also come out and denied saying that and denied the interpretation attributed to those remarks. He says it was taken out of context.

But let's -- Candy, for the sake of argument, let's take a horrible hypothetical situation. There is no state of Israel. Does anybody imagine that if there was no Israel, that radicals in the Middle East wouldn't wake up one morning and join Al Qaida...

CROWLEY: But that's not seriously on the table.

OREN: ... or join -- or join -- well, he's making -- you're imputing to him a meaning that he didn't have, but let's -- let's take it. Let's take it -- let's assume maybe that that was true. Does anybody imagine that people -- that radicals in the Middle East wouldn't get up in the morning and join Al Qaida and want to kill Americans? Moreover, if there was no Israel, would American forces be more safe or less safe? Through the cooperation of Israel, Americans are incredibly more safe, because through the cooperation with Israel, American soldiers are receiving training, receiving intelligence, receiving equipment that Israel has developed jointly with the United States. And Israel is saving incalculable number of American lives through our cooperation.

CROWLEY: Let me read you a little something, also, from an op-ed in the New York Times. This was Tom Friedman, who says, "The collapse of the peace process" -- the Israeli-Palestinian peace process -- "combined with the rise of the wall, combined with the rise of the Web has made peace-making with Palestinians much less of a necessity for Israel and much more of a hobby."

I think this reflects what I have heard talking around town with people, which is the feeling that Prime Minister Netanyahu isn't all that interested in getting to the table with the Palestinians and finding a lasting peace.

OREN: Well, I have great personal and professional regard for Tom Friedman. He's a great friend. But in this case, I have to take strong issue in what he wrote.

Listen, Israel withdrew from Lebanon in 2000. It withdrew from Gaza in 2005 in an attempt to generate conditions for peace. Instead of peace, we got thousands of rockets. We got two wars. We had years of suicide bombings from the Palestinians in which over 1,000 Israelis died, many thousands more physically and mentally maimed.

If Israelis are reticent about the peace process today, it's not because, as Tom claims, things are too good in Israel. It's because they're skeptical. Every poll in Israel shows that an overwhelming majority of Israelis favor the peace process, favor the two-state solution, but an also large percentage of Israelis are skeptical about the ability of the Palestinians to actually reach that. And I think that there's a reason why that skepticism exists.

The government of Israel is deeply committed to moving forward on the peace process, moving swiftly, addressing all of those core issues, including Jerusalem, at the negotiating table. We have to get the Palestinians to the negotiating table.

CROWLEY: But in the face of this skepticism, it seems that politically the safest thing to do for Prime Minister Netanyahu is not to be all that interested, is to -- is to take a hard line. Is there a sort of statesmanlike wish on the part of the prime minister to bring this thing to an end? You know, to most Americans, to most of the world, this seems like, you know, this is never going to happen.

OREN: Well, it's not going to happen if the Palestinians don't come back (ph) to the table. Prime Minister Benjamin Netanyahu comes into office -- he's the head of the Likud Party, keep in mind -- and he does things that no other Israeli prime minister has ever done.

Not only does he -- does he pledge not to build any additional settlements, not to expand settlements outward, not to even -- to refrain from incentivizing Israelis to move to settlements, he unilaterally freezes all new construction on the settlements for 10 months in order to get these Palestinians back to the negotiating table.

No other Israeli prime minister has ever done these things. Secretary of State Clinton called these moves unprecedented, and they are.

And, again, we have to wait. We are hoping the Palestinians get back to the table. Once they sit down with us face to face, we believe that we can move swiftly to move -- to addressing all of these core issues, Jerusalem borders, refugees, and we can reach a historic peace.

CROWLEY: Do you look at this and not see anything that Israel has done that has been provocative that has sort of led to this, what's been a real standstill? And, secondarily, are you convinced that if Israel could reach peace with the current Palestinian Authority, that that would stick? Do they have a leader in there in Abbas as strong as he needs to be to keep a pact, were there to be one?

OREN: Well, we hope that Abbas is such a leader. Prime Minister -- the Palestinian prime minister, Fayyad Salam, is also a -- a very prominent leader. And we have confidence that, once they join us at the negotiating table, that we can negotiate with them for a historic peace.

Again, we hope so. I am personally very confident. I think that the conditions today exist for moving forward toward a peace that did not exist perhaps at any other time in recent memory.

We have an Arab world where most of Arab leaders view another country, Iran, as the greatest threat facing them, not the state of Israel. We have a -- a Palestinian leadership which I said earlier is committed to the peace process. We have an Israeli government which is very deep, very widely represented, very stable, capable of making those hard decisions. And we have President Obama, a person who is personally committed to this process.

All of these factors put together auger very well. Again, I don't want to belabor this point more, Candy, but we can't get the peace unless we're sitting down and actually having the talks. We've got to get the Palestinians to the peace table.

CROWLEY: I literally need a one-word answer. The state of U.S.- Israeli relations is...

OREN: Great.

CROWLEY: All right. Thank you so much.

OREN: Thank you.

CROWLEY: Ambassador Michael Oren, we appreciate your being here with us. President Obama's education secretary wants to impose stricter graduation requirements for NCAA student athletes. Up next, we'll talk to Georgetown men's basketball coach John Thompson, who watched last night's Final Four.

(COMMERCIAL BREAK)

CROWLEY: Last night, March Madness narrowed the field to two teams that deserved to be called student athletes, Butler, the Cinderella team, and Duke. A national championship team brings millions in ticket sales and TV royalties to the university. But there's increasing concern for the people who play and don't get a degree. That's especially true of the African-American players.

A look at the final eight schools in the tournament says it all. Put together, they graduated 83 percent of whites, 45 percent of blacks. The worst school in the whole tournament was highly rated Maryland, which has a 33 percent graduation rate for whites and zero for blacks.

The teams that square off tomorrow actually have the best graduation rates of the eight, perhaps proving that good students can win. This week, Education Secretary Arne Duncan told John King schools with the worst graduation records should be barred from the tournament.

(BEGIN VIDEO CLIP)

SECRETARY OF EDUCATION ARNE DUNCAN: Where those values are out of line or misplaced, I think I have an obligation to challenge the status quo, and I'm going to continue to do that.

(END VIDEO CLIP)

CROWLEY: Duncan feels there are only a handful of bad programs.

(BEGIN VIDEO CLIP)

DUNCAN: What I don't understand is why we -- those handful, that small handful of bad apples -- I don't know why we continue to tolerate that. We don't need to tolerate that.

(END VIDEO CLIP)

CROWLEY: We'll talk about that with Georgetown coach John Thompson, who was in the stands for last night's final four.

(COMMERCIAL BREAK)

CROWLEY: Joining me now is the head coach for the Georgetown men's basketball team, John Thompson III, who graduates 82 percent of his players. Coach, thank you so much for being here.

I want to tell you, right off the bat, that decades ago, more than a decade ago, about 15 years ago, I talked to your dad and to Bobby Knight about this exact same problem, about how to get a higher graduation rate for some of these players, particularly among African- American players.

Why is this such a hard thing to do?

JOHN THOMPSON III, HEAD COACH, GEORGETOWN UNIVERSITY HOYAS: Well, I think there's a couple of things that -- and first of all, I want to say I agree wholeheartedly with Secretary Duncan's beliefs that institutions need to be held accountable for their athletes, their student athletes and their student body overall.

What I think gets lost with each passing year, as we tend to look at -- you know, let's take the secretary's statement, 40 percent, and we start to look at graduation rates and we start to look at the APR, the academic progress rate, is that different institutions have different missions. Different institutions have different resources that are available to them to provide the support to ensure that the student athletes are progressing toward a degree.

And so I think that it's difficult to clump the NCAA and just look at overall. I think that each individual institution has a different set of circumstances that help achieve that goal.

CROWLEY: Well, if we could boil it down from the institutions to the people that are in these young men's lives, what is the coach's responsibility here, to see that his players are, A, going to class, B, passing class, C, on the road to a graduation degree?

THOMPSON: Well, there's no doubt that as -- that as the basketball coach, we play an integral role. We are a key component to -- to that inspiration, to pushing and prodding and ensuring that the student athlete is doing that.

But at the same time, varying institutions have different amounts of academic support that can help these student athletes achieve their goal. You have different mechanisms in place that some institutions have that other institutions do not have to ensure that that happens.

What gets lost in all of this sometimes, I think, is the overall graduation rate of men's basketball players is higher than the graduation rate of the overall student body across the country.

Now, that's not to say -- clearly, there's room for improvement. It's not an issue that does not need to be addressed. But at the same time, I think, if we just looked at it in one blanket statement, you fail to look at each individual nuance, each individual circumstance at different institutions.

CROWLEY: One of the things Secretary Duncan suggested was that schools and universities that do not have a high enough graduation rate of some of these players should not play in March Madness and in the tournaments. THOMPSON: And I'm not sure. I agree with -- with his reasoning. I agree, as I said a few seconds ago, with the notion that institutions need to be held accountable. I'm not sure that is the answer.

Because you start to look at 40 percent as just a blanket number and you don't take into account how each individual institution got to that number.

I agree that it's my responsibility as a coach; it's the institution's responsibility to ensure that your student athletes are progressing toward a degree. But the circumstances under which a young man playing for Georgetown can get that may be significantly different than at school X. We may have more resources. We may have the ability to help that young man once he gets to our institution.

And also, a large part of the kids' inspiration; a large part of their reason for doing well in school and staying in it is because they have that carrot, the opportunity to participate in the NCAA tournament. If you take that away, they might not stay as focussed.

CROWLEY: What accounts for the disparity between the graduation rates of white players and the graduation rates of African-American players?

THOMPSON: I haven't looked at that. I think that, you know, one thing -- the NCAA statistics have shown -- research has shown is that, the higher the scores when you enter college, the higher you are -- the greater chance you have to graduate. All right?

And so with each -- every couple of years, the NCAA -- we've raised the floor in terms of requirements to be eligible to receive a scholarship, to be eligible to participate within the NCAA.

Now, the danger in doing that, though, is there's a huge segment of kids that are not going to get the opportunity to receive a scholarship, that are not going to get the opportunity to go to college because we're now raising the floor, kids that aren't as prepared but, if given the opportunity and given the support, they would have a chance to get a college degree; they would have a chance to get an education.

There's a large chunk of them that now, if we continue this trend to gradually raising the floor, raising the floor, there's a large segment that are not going to get that opportunity.

CROWLEY: So you don't think, though, that teams who have bad or very high rates of dropouts should necessarily be held accountable on the court?

You think it's a schoolwide thing?

THOMPSON: I think that each individual institution, each individual president needs to look at themselves and see what they are doing. I am not saying that it's not our responsibility. I'm not saying that I don't care about the academic progress, the academic -- the graduation rates; I don't care about -- I'm not saying that.

What I'm saying is there's so many different factors that go into play. You can pick up a piece of paper and look at the statistics and look at a number and make all these determinations without looking at, hey, school X is not available to provide summer school for their student athletes, where school Y is. THOMPSON: School X is not available to provide academic support, academic assistance, tutors, just because of the financial burden, where school Y is. There are so many other factors that go into that number.

Yes, there are, as the secretary said, there are a handful of schools out there that don't care. There are a handful of schools out there that are just trying to win games. But I think for the most part, across the board, the coaches, the institutions are trying to ensure that their student athletes are on a consistent basis progressing towards a degree.

CROWLEY: Coach, I need a one-word answer, Duke or Butler?

(LAUGHTER)

THOMPSON: I'm going to go with Duke.

CROWLEY: Thank you so much. Coach Thompson, and good luck next year with your team. We hope to see you move a little higher in March Madness. We appreciate it.

THOMPSON: Thank you very much.

CROWLEY: Next up, we're going to have a look at the news, and then we're going to move to baseball.

(COMMERCIAL BREAK)

CROWLEY: I'm Candy Crowley, and this is "State of the Union."

Let's check some of the stories breaking this Sunday. President Obama's top economic adviser says the worst may be over, but the economic recovery still has a long way to go before unemployment returns to pre-recession levels. Speaking on this show earlier this year, Lawrence Summers said the recovery will take years, but Summers suggested the economy could improve at a faster clip if Republicans stopped blocking President Obama's jobs bill.

Three blasts rocked Baghdad this morning. The seemingly coordinated explosions occurred near embassy buildings. At least 17 were killed. One of the explosions was outside the Iranian embassy. Renewed violence raises fears that insurgents will try to take advantage of political instability. It's been almost a month since elections failed to determine a decisive winner. Pope Benedict celebrated Easter mass at the Vatican and delivered his message without any mention of the scandal that has overshadowed holy week. At the start of the mass, the dean of the College of Cardinals said the pope is head of a flock that disregards what he called petty gossip.

Supreme Court Justice John Paul Stevens says he will surely retire while President Obama is still in office. Stevens turns 90 this month and is the dean of the court's liberals. In newspaper interviews, he says he will decide shortly whether he will step down this year or next. And a follow-up for you. Last week, we cited a CBS poll showing disapproval of the health care legislation seemed to be weakening after it was passed. From February to March, the number of those disapproving had declined. But in the newest CBS poll, disapproval is right back where it was before the vote. Shifting public opinion or the vagaries of polling -- take your pick.

Up next in our "American Dispatch," presidents throwing out the first ball on the opening day of the baseball season. Why are so many presidents lefties?

(COMMERCIAL BREAK)

CROWLEY: Tomorrow, President Obama throws out the first pitch of the Washington national season. The majority of American presidents have been right-handed, but in the modern presidency, five of the last seven presidents are lefties, and that includes President Obama. Psychologists have theories correlating left-handedness to verbal skills, quick thinking, and multitasking. Go figure.

Let's play ball. And if you're not going to watch tomorrow, again, President Obama is a lefty.

Thanks for watching "State of the Union." I'm Candy Crowley in Washington. Next week, we come to you live from New Orleans, where Republican leaders gather in the run-up to the midterm elections. For our international viewers, "World Report" is next. For everyone else, "Fareed Zakaria: GPS" starts right now.