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American Morning
Deal to Prevent Default; A Relief Rally; Washington Reaches a Debt Deal; Global Markets Rally on U.S. Debt Deal; Report: Breivik Shopped on eBay; Bloody Crackdown in Syria; MTV Turns 30; Signing Peyton Manning; Mubarak To Stand trial On Human Rights Charges; Memorial For I-35W Bridge Collapse Victims
Aired August 01, 2011 - 06:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CHRISTINE ROMANS, CNN ANCHOR: Good morning, Ali. A deal to prevent default. I'm Christine Romans. President Obama and congressional leaders agree to massive spending cuts in return for more borrowing power, but can they sell it to rank and file Republicans and Democrats?
CAROL COSTELLO, CNN ANCHOR: And a relief rally. I'm Carol Costello. Financial markets around the world reacting to news that a deal has been reached in the debt ceiling debate. What it means for your money?
ALI VELSHI, CNN ANCHOR: America's AAA credit rating. I'm Ali Velshi. While a deal, a real possibility that our stellar AAA credit rating could be in jeopardy, we'll break this down, why on this AMERICAN MORNING.
ROMANS: Busy weekend. Good morning, It's Monday, August 1st. A lot going on today.
COSTELLO: It was an agonizing weekend and we were all up late, late last night. E-mails flying at midnight.
VELSHI: It was busy. But things are a little brighter today than they were last night and Saturday night and a little brighter.
COSTELLO: Tiny bit. We start with that possible break-through in the debt ceiling crisis. In a few hours the House and Senate are expected to vote on a plan by President Obama and congressional leaders to raise America's borrowing limit in exchange for massive spending cuts.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: I want to announce that the leaders of both parties in both chambers have reached an agreement that will reduce the deficit and avoid default, the default that would have had a devastating effect on our economy.
(END VIDEO CLIP)
VELSHI: A sense of what the agreement looks like. It's going to increase the debt ceiling by up to $2.4 trillion. That is enough to get us through 2012, we hope. The plan also includes $917 billion in immediate spending cuts and it preserves the Republicans' bottom line.
A big win for Republicans and fiscal conservatives no tax increases. The agreement requires a new bipartisan congressional committee to recommend additional cuts by the end of the year. In announcing the plan the president made clear that the compromise is far from perfect.
(BEGIN VIDEO CLIP)
PRESIDENT OBAMA: Now, is this the deal I would have preferred? No. But this compromise does make a serious down payment on the deficit reduction we need and gives each party a strong incentive to get a balanced plan done before the end of the year.
(END VIDEO CLIP)
ROMANS: All right, reaching a deal is only half the battle. Congressional leaders have to sell it to members. In the House, Minority Leader Nancy Pelosi saying she sees -- needs to see, quote, "the final product in writing before she can decide if she supports it." Republican Senator Mike Lee is now threatening to filibuster today's vote.
(BEGIN VIDEO CLIP)
WOLF BLITZER, CNN ANCHOR: Senator, what do you think? Are you going to vote in favor of this agreement?
SENATOR MIKE LEE: You know, I haven't seen the legislation yet. I haven't had an opportunity to read it yet. Based on the summary I've received so far I'm not inclined to support it. I cannot support any effort to raise the debt limit that isn't accompanied by immediate and permanent structural spending reform.
(END VIDEO CLIP)
COSTELLO: More excitement to look forward to.
VELSHI: That's right.
COSTELLO: We are covering this story like no one else this morning. Our Brianna Keilar is at the White House, Athena Jones also in Washington.
But first to you, Brianna, Brianna's on the phone because I think or cameras exploded last night with all of our coverage.
VELSHI: Too many hours.
COSTELLO: Brianna, one of the biggest things the White House was pushing hard for, for a while, they didn't get it, though, tax increases for the wealthiest Americans.
BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT (via telephone): That's right. That is one of the big things that Democrats and the White House wanted. You know what I think is interesting to think about, is that this bill is a two-part bill and in the first part this increase in the debt ceiling and then just spending cuts.
But there is a whole lot of stuff that we will be talking about for months as the bipartisan committee that is being created in this bill works out some further deficit reduction measures. We don't know what that's going to be.
Certainly Republicans are going to be fighting for entitlement reform, which they did not get in the first part of this bill as well. Both sides have certainly tried to find common ground on tax reform and no doubt Democrats are also going to be trying to look for some way forward on a tax increase.
But there is one option that the president does have, keeping in mind, because what he's long wanted to do is let Bush-era tax cuts expire for those making about a quarter million dollars per year or more.
That was something he wasn't able to do last year. Those tax cuts are now set to expire in 2013, so that's another option where he could get the tax increase he wanted, delayed a little bit, of course, if he chooses to go that route.
ROMANS: All right, Brianna, let's bring in Athena. Athena, Nancy Pelosi is saying flat out she's not sure if she's going to support this and she's not sure about support among House Democrats. How can this deal go forward then?
ATHENA JONES, CNN CORRESPONDENT: Well, this is why it's not quite time to breathe a sigh of relief. This bill has to make it through both Houses of Congress. It's going to take Republican and Democratic support to get it through.
And as we heard Brianna talking about we know some of the issues that each side will have. On the Democratic side, they are disappointed it doesn't have these tax increases in the deal as it stands right now.
On the Republican side, you have these conservative Republicans, especially Tea Party members, who are against a debt ceiling increase period. So it's going to be interesting to see how it plays out.
On the point about Representative Pelosi though, it's important to remember that it's not that unusual to hear members of Congress say, well, I want it to review the deal, I want to look at it and read it before I'll commit to voting to it.
I spoke to a Republican who was on that conference call last night with Speaker Boehner where he laid out the details of this deal to his caucus and that Republican said while he believes the deal is likely to pass he doesn't want to commit to it until he's read it as well.
It's not necessarily that surprising that Pelosi did not commit the votes of her entire caucus when folks haven't necessarily seen the deal.
VELSHI: So I suppose, Athena, we should be thankful that's what members of Congress do, right? They say let me look at this. I've heard what the president and Boehner and Reid say it is, but I'm actually going to look at it. But here's the thing, this has to go through two votes. What's the likelihood?
JONES: Well, certainly the goal is that both Houses will vote on it today. The planning, the thinking is that this will start in the Senate, that they'll be debate opening sometime around midday and perhaps a vote in the late afternoon.
Now if that passes, then it will go on to the House where hopefully there will be a debate and then a vote late tonight. So we'll still have to see. They will have the morning, midday caucus meetings on both sides of the aisles.
And we expect there is going to be a lot of cajoling and explaining to make sure that this deal can go forward and get done tonight.
ROMANS: All right, we're all over it. Athena, Brianna, thanks, guys.
VELSHI: Yes, another late night.
COSTELLO: I can't wait.
VELSHI: Of watching Congress.
COSTELLO: Who needs sleep anyway. Coming up in the next hour, by the way, at 7:00 Eastern, we'll get more on this plan from Gene Sperling, assistant --
VELSHI: He's the --
COSTELLO: Assistant to the president for economic policy. I wanted to get his title exactly, but he's going to be speaking on behalf of the White House. We're going to ask him about no revenue, no tax hikes, nothing?
ROMANS: What did they get? What did the president gain?
VELSHI: What did they get in the trade?
ROMANS: It's not the deal he would have signed.
COSTELLO: Some people are saying he got absolutely nothing except this thing won't go through the November elections.
VELSHI: And we've got an all-star lineup this morning actually. We've got Gene Sperling. We're going to have John McCain. We're going to have Dick Durbin. We've got a lot of people lined up this morning.
ROMANS: Used to be Treasury in one of the Bush administrations.
VELSHI: Steven Moore from "The Wall Street Journal."
ROMANS: Yes.
VELSHI: It's going to be a busy morning.
COSTELLO: Nobody's doing a happy dance. We'll put that's way. ROMANS: We have work to do still.
VELSHI: All right, markets around the world are exhaling this morning. There's a lot of relief there is a debt deal on Capitol Hill.
ROMANS: That's right. Global markets rallying on the news, but there are still plenty of jitters out there. There always are. Eunice Yoon is live in Beijing. And as Ali has been putting out, we've been watching the futures all morning, they're showing a positive open for the U.S. predictions.
VELSHI: Less than it was a few hours ago.
ROMANS: With a grain of salt too. Hi, Eunice Yoon.
EUNICE YOON, CNN INTERNATIONAL CORRESPONDENT: Hi. Just as you said there are some jitters, but at the same time we did see a relief rally in Asian markets. Tokyo was the biggest winner. We saw quite a bit of relief there.
Basically, the U.S. dollar strengthened against the Japanese yen and that really helped to give a nice little boost to the exporters in Japan. Here in China people were also relieved. A lot of the manufacturers breathe a sigh of relief and this is because we've seen authorities here really for weeks now, urging Washington to get its debt problem under control.
Also, people have been very concerned and actually the state media has dubbed all of the politicking an irresponsible and dangerous game of chicken. They've been saying to stop playing that.
So still a lot of caution here because of the debt concerns and that's really what we're seeing playing out in the markets, but you know, as you said, jitters here, but at the same time people are feeling somewhat relieved. Guys --
ROMANS: That's interesting. The American media and Chinese media, state media are on the same page.
VELSHI: Right.
ROMANS: Dangerous game of politicking and game of chicken. That's very rare that happens and we're both sort of taking the same point of view. Thanks.
VELSHI: All right, let's go to London. Trading is under way right now. Nina Dos Santos is standing by on the trading floor in London. As we just mentioned, Nina, we had a strong market in Asia overnight. Started to weaken as we get through Europe and futures in the U.S. still looking like a positive open, but what's the feeling where you are?
NINA DOS SANTOS, CNN INTERNATIONAL CORRESPONDENT: Cautious optimism is the only thing I can tell you, Ali. What we have at the moment some of the markets rising in excess of 1 percent. Some of the traders behind me on this very trading floor are trading the FTSE and the FTSE is currently up in excess of 1 percent in today's session.
But what they've been saying is put that into perspective, Ali, because this is still a market that like many of the other European markets has fallen in excess of 4 percent just last week as, of course, the impasse on the U.S. debt ceiling grabbed all of investors' attention.
And now they're turning their attention towards future asking will the United States even if we get a raising of the U.S. debt ceiling manage to keep its AAA credit rating. One thing that is affecting the dollar, regaining some ground against the euro and pound in today's session.
But still a currency that's down about 17 percent in the past year on the back of these kinds of concerns. The euro is also down on the year. The euro, accounts for about 26 percent of the world's trade, the dollar two-thirds of the world's trade.
So you can see just how important whatever happens in Washington will be for the markets and the market makers behind me here. Ali --
VELSHI: Yes, you're right. Accounts for two-thirds of the world's trade and that's why this is -- this was not an American problem. This was a global problem in the same way that the euro's problems were a global problem. You'll stay on that and we'll check in with you later. Nina Dos Santos in London.
COSTELLO: You talk about these problems, one thing this deal does not do, it does not create one single job. It does nothing about the wage gap in America.
VELSHI: You wouldn't know that based on what some Republicans are saying this morning though.
COSTELLO: Exactly.
VELSHI: If it hadn't happened it would have cost us jobs. But as I said last night, that is the equivalent -- we had somebody on air saying this is all about creating jobs and I said that's like me saying that I saved a life by not killing somebody. That's what it is.
ROMANS: Something to ask Gene Sperling and others we're talking to, what about the wealth gap. We heard from Pew that you have this wealth gap widening between races in this country. So if you have $2 trillion in cuts and then it's talking about more cuts, who is it going to hit, how will we do this in a thoughtful way. Nothing that's been happening in Washington has been done in a thoughtful way.
COSTELLO: The other thing, you know, we're going through this austerity program now, isn't that what they like to call it, we cut everything. Some people say that will actually cost us jobs, many economists feel that way.
VELSHI: Absolutely, yes.
COSTELLO: So what exactly has this done for the average American?
VELSHI: That's going to be a good question for Dick Durbin. It's going to be a good question for Gene Sperling.
ROMANS: And brings us to our question of the day. The debt deal, who won last night, was it Wall Street? Was it Main Street, or was it someone else? You know, cast your vote, send us an e-mail, tweet, or tell us on Facebook. We're going to read your comments throughout the morning.
VELSHI: All right, Norway terror suspect Anders Breivik reportedly purchased bomb making chemicals and other equipment for last month's attack on eBay. According to Britain's Sunday "Telegraph," Breivik used the online auction site to buy sulfur powder for explosives, a protective suit and a drill press device to make poison-tip bullets.
As for Breivik's mental state, the head of the medical panel investigating the suspect says he believes he's in control of his actions and not insane.
ROMANS: More gunfire reported this morning in Hamas, Syria, following a violent bloody weekend. Government tanks rolled into the city yesterday, killing at least 71 people, injuring more than 100 others. President Obama describes those attacks as horrifying.
COSTELLO: It was an electrical short that caused a fire in the cockpit of an Air Egypt flight today, actually on Friday. Three hundred passengers had to be rushed off the plane shortly before takeoff from Cairo to Saudi Arabia. Two firefighters also treated for smoke inhalation.
VELSHI: And just a few broken bones and minor injuries after this Caribbean Airline jet slid off a runway and crashed Saturday morning in Guiana. Look at that. Just a few injuries. That thing has come apart. That Boeing 737 split in half after crashing through a fence in rainy weather. It is amazing no one was killed there.
ROMANS: In Chicago, police say so many people are being busted for possessing small amounts of marijuana. They might start handing out citations instead of booking suspects and putting them behind bars. Seems the jails are getting overcrowded because of all the pot bust and many of the cases are thrown out by judges anyway.
COSTELLO: Believe it or not. MTV turns 30 today. Yes, you are old! On this day in 1981, the first music video aired on the 24-hour music network. It was the Bugles singing video killed the radio star --
VELSHI: That's incredible.
ROMANS: Even looks antique.
COSTELLO: It does. It's embarrassing that used to be cool. Anyway, MTV can be seen in over 600 million homes and has changed its focus since the early days with reality shows like "Teen Mom" and the fabulous "Jersey Shore." Remember the original five deejays, Nida Blackwood, Mark Goodman, Allen Hunter. I loved Martha Quinn. She was awesome and J.J. Jackson. That was then, this is now.
This will really make you feel old. Only four members of the original Fab Five remain, J.J. Jackson passed away in 2004, but the memories.
ROMANS: Wow.
VELSHI: That's -- getting my head around the fact that's 30 years. That's incredible. Still to come this morning, a big announcement from Europe's largest bank this morning and it could affect your local banking branch. We'll tell you more coming up.
ROMANS: Also, heat warnings. Dangerous temperatures in the Midwest, heat advisories and - and warnings are now in effect. But is there any relief in sight? We're going to check with Rob Marciano next.
COSTELLO: And sign on the dotted line. Peyton Manning's new deal with the Indianapolis Colts is a big one. It's more than big. It's humongous. We'll tell you how much the prized quarterback will be pulling in and he turns the money down. It's incredible.
You're watching AMERICAN MORNING. It's 15 minutes past the hour.
(COMMERCIAL BREAK)
VELSHI: Welcome back to AMERICAN MORNING. Here is what is new this Monday morning.
It must be good to be Peyton Manning right now.
UNIDENTIFIED FEMALE: Really good.
VELSHI: The priced quarterback just inked a deal with the Indianapolis Colts, five years, $90 million. To break that down, it's about $18 million a year.
ROMANS: Now, that's a deal I can understand.
VELSHI: In fact, it's very straightforward. He ties with New England Patriots' quarterback Tom Brady for the highest contract in NFL history. Manning's well worth the cash. He's a four-time league MVP.
Did you hear this - a bit about how he - he actually turned down some other money, more money so that -
COSTELLO: Yes. The Indianapolis Colts wanted to pay him more, but Peyton Manning says no, $90 million is enough for me for the good of the team.
VELSHI: So that in theory -
COSTELLO: We need to hire better players.
VELSHI: -- they can hire other - incredible. ROMANS: Wow.
COSTELLO: Using some of the salary that I would have gotten. I'm satisfied with 90 million.
ROMANS: Now there is leadership there (ph).
VELSHI: Speaking of leadership -
COSTELLO: Speaking of leadership, a second chance for Plaxico Burress. I don't think this has anything to do with leadership but hey. The wide receiver just signed a one-year, $3 million contract with the New York Jets. He's hoping to revive his career with his new NFL home.
VELSHI: After shooting himself in the leg.
COSTELLO: Stop that.
VELSHI: Sorry, sorry.
COSTELLO: We don't want to be reminded of those horrible things.
VELSHI: Sorry.
COSTELLO: Anyway, he went to prison for that.
VELSHI: Yes.
COSTELLO: Prison, actually spent 20 months in jail on that gun charge. He chose the Jets over his two former teams the Giants and the Steelers. Everybody wanted him.
ROMANS: All right. Rob Marciano is here. We teased heat advisory, some hot weather in the Midwest, Rob is here to tell us what it means. Hi, Rob.
ROB MARCIANO, AMS METEOROLOGIST: Hi. Hey, guys. Good morning, again.
We're looking at, yes, more heat across the Southern Plains. Sounds like a broken record. It pretty much is what's spoken there (ph). Tired of it for sure. Places like Texas, in through Oklahoma, in through Kansas.
And, by the way, remember Don? We were talking about that for a few days, end of last week, it completely died Friday night and it brought practically zero rain in Texas. So now they're not only dealing with the heat, they're dealing with this ongoing drought as well with zero help from Don.
It will be 103 in San Antonio today, 109 expected, the actual high temperature in Dallas, and it doesn't include the humidity. Including humidity, it goes up and over 110 easily and that's going to go on I think for the next couple days. As a matter of fact, it builds a little bit farther to the north where this front is not making very much progress to the south. That's where we're seeing thunderstorms pop up right now. And we'll see some thunderstorms later on in the day with a little weak front that's going to push through the - the northeast. And that will help at least cool things down a little bit. But it will cause delays if you're traveling through the New York City airports this afternoon, you're traveling this morning or I guess it would be over the next few hours through San Francisco, some morning fog be aware of that.
Watching this carefully, this could be our next tropical system, could be Emily as soon as later today. Hurricane aircraft are en route and it's very close now to the Winward Islands heading to the west and towards the northern islands of the Caribbean. They're going to be under the gun here over the next couple of days with heavy rain and maybe some wind. And if it continues to develop and strengthen, we'll watch it carefully, potentially making a threat towards the U.S. and Florida or the Carolinas towards the weekend or early next week.
ROMANS: All right.
MARCIANO: Keep you posted on potentially Emily throughout the morning, guys.
ROMANS: OK. Thanks, Rob.
VELSHI: Still to come on AMERICAN MORNING, your money on the move this morning. Markets across the globe are reacting to the debt ceiling agreement. Richard Quest standing by live on this side of the pond to help break down global reaction.
ROMANS: I can't wait for that.
And our question of the day pegged off, of course, a pending debt ceiling agreement if we get it. We want to know who won last night, Wall Street, Main Street, somebody else?
VELSHI: Great responses already we're getting.
ROMANS: Kind of some counterintuitive responses as well.
VELSHI: Yes.
ROMANS: Send us an e-mail, a tweet, tell us on Facebook. We're going to read your thoughts later throughout the morning.
(COMMERCIAL BREAK)
VELSHI: Twenty-five minutes after the hour. "Minding Your Business" this morning.
A sigh of relief, that's the line on Wall Street today. Investors feeling bolstered now that U.S. lawmakers have reached a deal to raise the nation's debt ceiling. Right now, U.S. stock futures are trading higher on that news and world markets made gains overnight. But investors remained vigilant this morning as Congress still needs to pass that bill officially. The Dow lost more than four percent last week as Washington struggled through this debt deal and that closed out the worst month for blue chip stocks since August of last year.
Gold prices are retreating overnight on news out of Washington. Gold futures dropped about one percent in overseas trading and that is following a record high on Friday of $1,634 an ounce when investors rushed to the precious metal over uncertainty on the debt deal.
HSBC has just announced it's slashing 5,000 jobs in the U.S. and abroad. The company said that about 25,000 more jobs will be cut globally over the next two years. The bank also says it sold 195 of its U.S. banking branches to First Niagara as part of its restructuring plan.
One hundred and seven S&P 500 companies will report their quarterly earnings this week. Insurance companies Humana and Allstate are expected to report before the opening bell this morning. Honda reported overnight its net profit plunged 88 percent in the second quarter and that's mostly due to the earthquake in Japan.
Also on investors' minds this week, the big monthly jobs report for July. Analysts surveyed by Briefing.com are forecasting that only 78,000 jobs were created in July. But last month, Wall Street got a shock when the government announced only 18,000 new jobs were added in June. That was way below estimates.
Don't forget for the very latest news about your money, check out the all-new CNNMoney.com.
AMERICAN MORNING back right after the break.
(COMMERCIAL BREAK)
VELSHI: President Obama strikes a deal to prevent the country from defaulting on its massive debt. But can he sell it to lawmakers before tomorrow's deadline?
We're live in Washington on this AMERICAN MORNING.
VELSHI: Welcome back. It is Monday, August the 1st. You are looking live at the Capitol where the big debt deal is being hammered out and finalized as we speak. It even looks brighter and cleaner and it looks like it's not as messy.
COSTELLO: Really? They're still going to vote on that thing.
VELSHI: You're right.
ROMANS: We do it all along.
COSTELLO: Yes.
ROMANS: We're so worried about -- COSTELLO: Put us through the agonizing weekend for nothing. This has been dragging on for seven months, this debt ceiling debate.
VELSHI: And this not a substantial different deal than many had suggested a long time ago. It was definitely dragged out a lot.
COSTELLO: Yes. It's not as if our debts and deficits came overnight.
VELSHI: Right
COSTELLO: It seems that they've been here for a while and now, suddenly, we're, hopefully, trying to get them solved.
Now, here are the morning's top stories outside of the deal.
In just a few hours, the House and the Senate will vote on that new debt deal. The measure increases the debt ceiling by up to $2.4 trillion, enough to carry us through 2012. It also includes $917 billion in immediate spending cuts without tax increases. That's $917 billion in spending cuts. That means you're going to feel it a lot of different places.
Calls for a new bipartisan congressional committee to recommend additional cuts by the end of the year, that means --
COSTELLO: We should talk about that. So, they're going to create this bipartisan congressional committee --
ROMANS: Yes.
COSTELLO: -- to figure out what to cut through the second round. They're going to cut $1 trillion off the top, right?
VELSHI: Right.
COSTELLO: And the $2 trillion in cuts is going to be decided by this bipartisan committee.
ROMANS: Yes.
COSTELLO: If it can't come up with an agreement, it will be punished.
ROMANS: It will be punished. There will be automatic cuts.
COSTELLO: Automatic cuts to Medicare to punish Democrats and automatic cuts to defense spending to punish Republicans. Nothing about taxes, right?
ROMANS: No automatic tax increases. You're right.
And when you talk about this new round of cutting that's going to come, it could be the mortgage interest deduction.
VELSHI: Yes.
ROMANS: It could be a whole bunch of different things that affect all of us.
VELSHI: So, a lot of people have been tweeting, what does it do to this and what does it do to that? I wish we knew.
ROMANS: They don't even know yet.
VELSHI: But that's fine. A bipartisan commission of congressmen will get it done in like a week.
COSTELLO: Congress has created a bipartisan committee to punish Congress.
VELSHI: Yes. It's --
COSTELLO: If it doesn't come up with an agreement.
VELSHI: If you don't understand it, it's OK. Nobody does.
COSTELLO: OK. Let's move on to other news because my head is about to explode.
The FBI is offering a $25,000 reward to anyone with information about a missing New Hampshire girl. Rescue teams searched by land and air over the weekend for 11-year-old Celina Cass. Her parents say she was gone when they went to her room to wake her up last Tuesday morning.
VELSHI: More gunfire reported this morning in Hama, Syria, following a bloody violent weekend. Government tanks barreling through the city yesterday, killing at least 71 people and injuring more than 100 others. President Obama describing the attacks as horrifying.
ROMANS: All right. Let's get back to our top story now. A debt ceiling deal in place and in just a few hours, both the House and Senate are expected to vote on the plan.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I want to announce that the leaders of both parties in both chambers have reached an agreement that will reduce the deficit and avoid default -- a default that would have had a devastating effect on our economy.
(END VIDEO CLIP)
ROMANS: Here's what the agreement looks like. Increase the debt ceiling by up to $2.4 trillion. That's enough to get us through 2012. The plan includes, as we said, $917 billion in immediate spending cuts.
COSTELLO: There are also no immediate tax increases and the agreement requires a new bipartisan congressional committee. That's what we were talking about. That committee will recommend additional cuts by year's end.
In announcing this plan, the president made it clear the compromise is far from perfect. (BEGIN VIDEO CLIP)
OBAMA: Is this the deal I would have preferred? No. But this compromise does make a serious down payment on the deficit reduction we need and gives each party a strong incentive to get a balanced plan done before the end of the year.
(END VIDEO CLIP)
COSTELLO: But there is still a tough hurdle in place, getting enough votes from both parties to pass it.
So far, Minority Leader Nancy Pelosi's support is still up in the air. In a statement she said she needs to see that final product.
And Republican Senator Mike Lee, he's threatening to hold up the compromise.
(BEGIN VIDEO CLIP)
WOLF BLITZER, CNN ANCHOR: Senator, what do you think? Are you going to vote in favor of this agreement?
SEN. MIKE LEE (R), UTAH: You know, I haven't seen the legislation yet. I haven't had an opportunity to read it yet. Based on the summary that I've received so far, I'm not inclined to support it. I cannot support any effort to raise the debt limit that isn't accompanied by immediate and permanent structural spending reform.
(END VIDEO CLIP)
VELSHI: Let's bring in Athena Jones. She's live in Washington right now.
Athena, bottom line it for us. What is the likelihood we are going to see the necessary votes on this by tonight?
ATHENA JONES, CNN CORRESPONDENT: Well, I can tell you, Ali, that, certainly, the goal is to have both houses vote on this tonight. The thinking is that the Senate will go first. And if all goes as planned, Democratic leaders hope to begin debate sometime around midday between noon and 2:00 p.m., have a vote sometime in the late afternoon. If it passes the Senate, then it will go on to the House where leaders hope to vote tonight as well.
Of course, it's hard to know what's really going to happen.
Both sides have acknowledged that the deal is not perfect. We heard President Obama say that in his remarks last night. Speaker Boehner said that last night in the conference call he had with his caucus in the House, laying out the bill. We know that Speaker Pelosi is not yet committed.
And we know the problems that each side may have with this bill. On the Democratic side, it doesn't involve those tax increases they'd like to see right away. And on the Republican side, you have those conservative Republicans, members of the Tea Party in particular, who are against the debt ceiling limit being increased period.
So, during these morning and mid-afternoon caucus meetings that each party is going to be having in both houses with their members, we can expect there to be a lot of explaining and cajoling in the hopes of getting this bill through. Everyone understands that it's really down to the wire. This is the last minute and they need to get this through.
So, we'll see -- we'll see what happens and what time it happens.
VELSHI: Athena, thank you.
All right. As we've been talking about, there's a whole lot of stake in Washington. The nation's financial standing in the world, our role in the world.
Look, the bottom line is, as Nina said, the U.S. is responsible for two-thirds of the world's trade. So, this is crucial. There's a lot at risk if this doesn't get passed.
Richard Quest is live on the National Mall, as he wanted to see it for himself. He was fascinated abroad that Americans could get themselves into this pickle he has come right into the heart of democracy in America to understand it.
Are you figuring this strange people who are Americans out?
RICHARD QUEST, CNN INTERNATIONAL ANCHOR: Hey, listen, half past 6:00 in the morning. I am the only person who is out on the Mall. Where are all these Americans that I was promised I would meet at this hour of the morning?
Listen, the debt agreement last night is very simple. Think of ourselves or think of yourselves as I think of the financial world as being like the passengers on an ocean liner that sunk or was sinking and we've managed to get off. We are now in the life rafts. The only problem is, all around us, there are sharks and we've still got a long way to go before we get to the land and safety.
So, yes, the markets are cheering this morning's deal, or the overnight deal. They like what they see. It's a very good start. There are gains on most of the international markets.
But the question is, Ali, whether those gains stick.
VELSHI: All right, Richard --
COSTELLO: Actually, something I would like to know about our bond rating. So, even if we get this through and the president signs it, does that mean we'll still have AAA bond rating?
VELSHI: Richard, I'm going to have you go hang your head on that one.
QUEST: I mean, I suspect -- thank you, Ali. I suspect during the course of today, the rating agencies, the major rating agencies, will be pushed very hard to say whether -- if the deal is confirmed, as it stands, they would agree to keep the AAA.
Now, am I going to come down left side or right side? Yes or no? Ali, I'm going to let, as they -- I'm English, we are gentlemen. So, Ali, after you, announcing that one.
COSTELLO: Come on, business people.
VELSHI: Mark Zandi from MoodysEconomy.com, which is the sister company of Moody's, not part of the rating's agency, said he thought this deal was big enough to avoid a debt downgrade. But Bill Gross of PIMCO, who is one of the biggest bond traders in the world says no.
ROMANS: There are big investors, Richard, who say that the United States is not acting like a AAA country. It's acting like a AA country. And that even if you have a big deal today, you still have this political discord which does not bode well for the next round of all of this, even that commission that $1.5 trillion you got to cut going forward?
QUEST: Do not underestimate the huge pressure that will be put to bear on the rating agencies now this deal has been done to hold the AAA line.
VELSHI: Right.
QUEST: It will be very brave agency to decide to go out on a limb and reduce it. I would not put money on the AAA going not in the short term after this deal.
COSTELLO: I'm sure many Americans are hoping the very same thing. Richard, we saw joggers moving by.
VELSHI: We got some Americans jogging behind you.
COSTELLO: Go run after them and you'll meet your Americans.
(LAUGHTER)
VELSHI: We'll check in with Richard.
ROMANS: Richard Quest.
VELSHI: All right. Coming up at 7:30 Eastern, we will be joined by Senator Dick Durbin of Illinois.
He's got some tough questions to answer. As the majority whip, he knows better than most Democrats how to vote on this compromised deal. But we want to ask him, what Democrats got out of this deal. And then we're going across the aisles getting Arizona Senator John McCain's take on the deal. He'll join us live at 7:40 Eastern.
You're watching AMERICAN MORNING. We're back in two minutes.
(COMMERCIAL BREAK)
COSTELLO: Good morning to you and welcome back to AMERICAN MORNING. It is question of the day time.
Today, the House and Senate are expected it to vote on a debt ceiling agreement by President Obama and congressional leaders.
VELSHI: So, we want to know, in this debt deal who won last night? Was it Wall Street? Was it Main Street? Was it someone else?
And here is what you are saying. Some fantastic answers.
Monica on our blog says, "The Tea Party won. A new gang" -- I'm sorry, is that Monica?
ROMANS: Yes.
VELSHI: "Tea Party won. A new gang of bullies has moved into Washington, D.C. Not even the lobbyists have the courage to stand up to them."
COSTELLO: And this is from Sarah. She says, "I'm afraid no one won. We still have unemployment that is way too high. I will be watching John Boehner and his crony friends to see if they can create any jobs."
ROMANS: And from our blog, Caleb says, "Wall Street: All the spending cuts are going to hurt much of the recovery areas giving the private option some ground. Avoiding default saved the dollar from falling in the world and stocks will also increase now that the scare is over."
VELSHI: Probably right.
ROMANS: All right. Keep your comments coming. Send us an e-mail, a tweet, tell us on Facebook. We'll read more of your thoughts a little bit later in the program.
VELSHI: All right. A break now from the debt deal news and that can only mean one thing, cute animal video time.
First up, teaching a dog to play dead is common trick, right? Everybody's done it. But have you ever seen a dog play dead on its own.
Check out this video. You can see this puppy with another dog, then after a little a nip to the neck, the puppy fakes its death.
For a little while and then gets up because it wants to play again.
(LAUGHTER)
VELSHI: The other dog, what happened? I just sort of kissed you.
ROMANS: And check out this baby silver leaf monkey and nurse at the San Diego Zoo stepping in after the newborn's mother had trouble feeding her. The zoo says not to worry, the monkey family is getting plenty of social interaction between feedings. So, the bond is strong despite the nursing issues. ROMANS: OK. One more if you can stand it. Check out these dancing moves. Oh, yes, this baby hippo was born back in January weighing 100 pounds. This video shot at the San Diego Zoo last month. Officials say it's been interesting to see this young hippo's personality blossom.
VELSHI: He seems unaware of the fact that hippos don't have personalities later in life. So, you might as well get it out all in the first month. They sit around in the water all day and eat grass at night. They really don't do stuff like that.
COSTELLO: Sounds like a good life to me.
ROMANS: Me, too.
All right. Still to come this morning, one man's dramatic transformation from recruit to soldier. CNN followed him through boot camp, right to his first deployment in Afghanistan. Our Jason Carroll is going to join us with this really incredible story. (COMMERCIAL BREAK)
COSTELLO: Good morning to you. It is 46 minutes past the hour. Here's a look at your headlines.
A compromise debt deal may just be hours from a vote in both Houses of Congress. The measure increases the debt ceiling by up to $2.4 trillion and also includes $917 billion in immediate spending cuts without tax increases.
Stepping up the search for 11-year-old Celina Cass. The New Hampshire girl has been missing since last Tuesday morning when her parents say they went to her room to wake her up, and she was gone.
A relentless heat wave that smothering the Midwest. Eight state face excessive heat warnings or advisories this week. The heat index expected to hit 110 degrees in parts of Kansas, Missouri, Oklahoma, Arkansas, Louisiana, Nebraska, North Carolina, and Texas.
A verdict and sentence expected this week for two U.S. hikers who've been held in Iran on spying charges for the last two years. The attorney for Shane Bauer and Josh Fattal says he hopes they'll be found guilty, sentenced to time served, and sent home.
At a new report says hate crimes against gays and lesbians are way up despite a drop in overall violent crime and states legalizing same-sex marriage in the repeal of the military's "Don't Ask, Don't Tell" policy. The report by the National Coalition of Anti-Violence programs says hate crimes against gays and lesbians have jumped by 13 percent between 2009 and 2010.
Our kids are eating out way too much. Researchers at the University of North Carolina say more of our children are buying more prepared meals from supermarkets or fast food that are high in sugar and calories and that is fueling an obesity epidemic.
"Harry Potter and the Deathly Hollows" just hit the billion dollar mark at the box office. It took only 17 days and ties an all-time record. Only nine films in history have made that much money with "Avatar" topping the list at $2.8 billion.
You are now caught up on the day's headlines. AMERICAN MORNING is back right after this.
(COMMERCIAL BREAK)
COSTELLO: Welcome back to AMERICAN MORNING. Here's what's new this morning.
Former Egyptian president, Hosni Mubarak, heading to trial this week on charges of human rights abuse. The trial was recently moved to a police academy in Cairo for security reasons. The 83-year-old ousted leader could face the death sentence if convicted. Mubarak, as you know, was thrown out of office back in January after three weeks of protests. More than 800 people were killed during that uprising.
VELSHI: Boy, I remember this day four years ago, so clearly.
ROMANS: That's right.
VELSHI: The I-35 west bridge over the Mississippi River in Minneapolis suddenly collapsed, killed 13 people, injured 145. Remember, the cars precariously hanging there. The city is holding a memorial this afternoon to remember and honor the victims of the disaster. Officials will dedicate a remembrance garden which includes 13 pillars each etched with the name of a person who died in the collapse. It was everybody's fear that, you know, that kind of thing happens. And you just hope and pray that it never does.
ROMANS: And we scoured the country looking for bridges of the same type and the same sort of pedigree to make sure that they need to be fixed --
COSTELLO: But doesn't it make you wonder how much fixing has been done across the country?
ROMANS: How much patching has been done instead of fixing?
VELSHI: While I drive, you know, when I see, I go under bridges that look like things are falling down, and I wonder, does that mean anything that there's a big chunk of concrete that fell down, and I figure, the people in charge must be on top of this. So --
(CROSSTALK)
ROMANS: As we approach ten years since the 9/11 attacks, former president, George W. Bush, is breaking his silence on the criticism he's faced because of his reaction. The president was sitting in a Florida classroom when his chief of staff whispered the twin towers were under attack. The president appeared stone faced.
In an interview with the National Geographic Channel, the former president says that he chose not to leave the classroom immediately because he wanted to project a sense of calm in front of the children and in front of the world.
VELSHI: There's no way that you can't -- now that you know what it was, that you can't say that he certainly something changed in his demeanor. He looked very serious. He looked very concerned.
COSTELLO: What do you want him to do? Jump up and scream.
VELSHI: Yes. I think this is one of those things where we start to have, you now, we start dig a little too deep --
COSTELLO: Our opinion comes down along partisan lines as usual from the home front to the front lines in Afghanistan. We have followed one man's dramatic transformation from recruit to soldier.
VELSHI: Will McLain's incredible journey to become a combat engineer began nearly two years ago. Jason Carroll has been with him every step of the way. He's here with us now. Tell us the story, Jason.
JASON CARROLL, CNN NATIONAL CORRESPONDENT: Yes. It's been incredible to watch this guy. Carol, we were just talking about this very briefly. You know, it's literally been watching him grow up in front of our eyes. He's no longer a teenager. He's now 20 years old. Will McLain is also no longer the recruit. He's now a soldier fighting the war in Afghanistan, in an area where the pressure is on to eliminate the Taliban.
(BEGIN VIDEOTAPE)
CARROLL (voice-over): We first met Will McLain when he was an 18- year-old high school student desperate to escape his small town, Rosamond, California.
UNIDENTIFIED MALE: I'm glad to be getting out of this little town, you know, because it gets old, but there's a lot of things you will miss, you know?
CARROLL: That was nearly two years ago. Since then, we've watched McLain's dramatic physical transformation. Following him from recruit.
UNIDENTIFIED FEMALE: Pick up your bag.
(CHANTING) yes, drill sergeant.
CARROLL: Through basic training.
UNIDENTIFIED MALE: Let's go.
UNIDENTIFIED MALE: I hate this.
CARROLL: To soldier.
How much more weight have you lost? Looks like you've lost even more weight?
UNIDENTIFIED MALE: About 170, 175 -- CARROLL: 170, 175 pounds.
UNIDENTIFIED MALE: Down another 15 from when I was at the states.
CARROLL: McLain is now a combat engineer at Forward Operating Base Lagman in Zabul, Afghanistan. It's his first deployment, his first time in a war zone. We caught up with him minutes after returning from a 40-hour mission.
The training is much different from the reality being here on the ground, right?
UNIDENTIFIED MALE: It's a whole different story. Going from training to here.
CARROLL: Here is a place where searches for roadside bombs routinely kill and injure. McLain and his company of combat engineers specialize in finding those bombs. His captain telling us on their last mission, their convoy got hit by one.
It's very serious out there.
CAPT. TIMOTHY BUTLER, U.S. ARMY: It was. There were several injuries. Everyone was fine. Everyone will fully recover.
CARROLL: Sergeant Herbert Joseph received second-degree burns on his leg.
Is this the first time you've been hit like this.
SGT. HERBERT JOSEPH, U.S. ARMY: The first time.
CARROLL: The first time.
And has been a few more times for Staff Sergeant Robert White.
How many times have you been hit?
STAFF SGT. ROBERT WHITE, U.S. ARMY: Too many. Too many times to count.
CARROLL: It's a constant threat for these combat engineers, and while the bomb didn't hit McLain's vehicle during the mission, the worry is always there.
How do you psychologically sort of move past that and focus on the job at hand?
UNIDENTIFIED MALE: I think the big thing is you just got to trust in the person beside you, you know? Like, you know, you got to know how to do your job, do it as well as you can and trust the guy next to you is going to do his.
CARROLL: McLain has come to terms with the reality of what fighting a war really means, though, he has changed much over the two years. He says, even if he could, he wouldn't change anything about his decision to enlist, but he has had a change of heart about Rosamond, California.
UNIDENTIFIED MALE: You know, looking back at my hometown, I was a lot more harsh towards it.
CARROLL: I remember.
UNIDENTIFIED MALE: I should have been. And now, I look back, you know, it raised me to be what I am.
(END VIDEOTAPE)
CARROLL (on-camera): Learned a lot. Again, Will is a combat engineer. He's one of the men who go out and find those roadside bombs and the insurgents who plant them. Tomorrow, we'll show you what that is like when we go out with the soldiers and his company. It is a dangerous job.
COSTELLO: Let me ask you this, because, you know, there's been a lot of uncertainty in this country about whether we'll be able to pay our soldiers in the field, you know, with this debt ceiling debate.
CARROLL: Of course.
COSTELLO: And fights over the deficit, and then, there's this sense that most Americans don't want our troops in Afghanistan anymore. They're against the war there. So, is this young man aware of those things?
CARROLL: They are. Will and the other men are aware of this. You know, the internet is there, sporadically because of the Taliban shuts down some of the cell towers in the area where he is. So, they do hear about the discussions. You know, they're still in contact with the people at home. They hear about what's happening.
But you know what it is, when they're there, they try to keep focus on the job because you have to, because it's so dangerous on the ground in these particular areas, especially the southeastern portion of the country, you really have to stay focused. So, you put that aside, you leave that where it should be, and you focus on the job at hand.
ROMANS: All right.
COSTELLO: So admire him.
ROMANS: From an idle teenager in California to a young man in the field. It's just amazing.
CARROLL: It's incredible to watch the transformation.
ROMANS: I can't wait to see the story tomorrow.
COSTELLO: Me, too. Thank you so much.
ROMANS: All right. Top stories coming up in the top of the hour. It's 57 minutes after the hour. You're watching AMERICAN MORNING.
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