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Financial Crisis Brings Presidential Candidates Together; House Reaches Preliminary Agreement on Bailout; Will McCain Show for Debate?
Aired September 25, 2008 - 13:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, HOST: I'm Kyra Phillips in Atlanta. You're live in the CNN NEWSROOM.
Forty days, $700 billion. The first is how close we are to choosing a new president. The second, the size of that crisis. It's bringing both the major candidates together with the outgoing president to look for a way out.
Here's where things stand now. President Bush hosting Barack Obama and John McCain at the White House three hours from now. Congressional leaders from both parties will be there, too.
Some in Congress consider that meeting a distraction from the real work on Capitol Hill. Negotiations are said to be centered on taxpayer and homeowner protections.
As for the other debate, well, the McCain campaign is insisting that tomorrow night's face-off at Ole Miss be postponed if there's still no deal on a bailout. Obama plans to be there, bailout or not.
Well, the candidates agree the issue at hand is bigger than both of them. Can they really work hand in hand to lead the nation back to prosperity?
CNN's Ed Henry is at the White House.
Tell us, Ed, is this really statesmanship, or is this gamesmanship?
ED HENRY, CNN CORRESPONDENT: Kyra, it really depends who you ask. If you ask John McCain, he says it's statesmanship. He's putting country first. It plays right into his whole campaign theme to say, "Look, I'm suspending my campaign, getting off the campaign trail, trying to get a deal here on the financial crisis, some sort of a bailout. Some way to deal with it."
On the other side, Democrats aligned with Barack Obama are saying it's all about gamesmanship, that John McCain's campaign was stalled. He was losing momentum because of this financial crisis, because the public may blame a Republican White House over the crisis, and that he was throwing up, basically, a Hail Mary.
What's fascinating to me, as someone who's just been on the campaign trail -- I haven't been here in the White House for about two months. And when I left, it was pretty quiet here. All the action was sort of away from the White House. Now it's all coming back here.
Just a minute ago, before you brought me in, the limousine carrying the Palestinian president, Mahmoud Abbas, went right behind me. He's going in to meet with the president.
On a normal day, that would be a big story: President Bush's final days, trying to get Mideast peace. Instead, very few people are talking about that. There's all this anticipation and buzz.
As soon as I came through those gates this morning, coming in from New York, about what is going to happen at 4 p.m. Eastern this afternoon? You're going have the next president of the United States in that cabinet room with the current president of the United States, and the person who's going to lose the presidential race, he's going to be in the cabinet room, as well. No one can really think about a precedent for this, to have both presidential nominees in that cabinet room with the president three hours from now, Kyra.
PHILLIPS: Ed, I want to talk more. We're going to talk again, but Chris Dodd is speaking. Let's go to that, just for the sake of balance here on this issue.
(JOINED IN PROGRESS)
SEN. CHRIS DODD (D), CONNECTICUT: ... One, the taxpayers, which is tremendously important. We're giving the secretary authority that he will need in order to act and the funding that he will need.
We also have dealt, I think effectively, with the issue of effective oversight, with homeownership preservation, as well as executive compensation.
Now, in anticipation to your questions, we're not going to go into the details of this. Clearly, we now need to meet with the Treasury Department and go over principles which we've agreed on among ourselves, and obviously go back to our respective caucuses to talk with them, as well.
But this is the time we try to come together, both chambers, both parties, to respond to the requests we've received from the Bush administration. We believe we've done that, as leaders on this issue, as the appropriate committees of responsibility. A lot of us will be talking to our respective leadership, as well.
But we're very confident that we can act expeditiously. We think we've done a good job in arriving at that kind of consensus. Now let me turn to Bob Bennett of Utah for any comments. And then we'll turn to Barney, as well as Spencer Bachus, from the House.
REP. BOB BENNETT (R), UTAH: I concur absolutely with the chairman. It was a very productive meeting, and the most encouraging thing that comes out of this, from my point of view, is that I now expect we will, indeed, have a plan that can pass the House, pass the Senate, be signed by the president, and bring a sense of certainty to this crisis that is still roiling in the markets. That is our primary responsible, and I think we are now prepared to meet it. I appreciate very much my Republican colleagues who participated in the meeting and added tremendously. We focused on solving the problem rather than posturing politically, and it was one of the most productive kinds of sessions, in that regard, that I participated in since I came in to serve.
DODD: Barney Frank, please. Mr. Chairman?
REP. BARNEY FRANK (D), MASSACHUSETTS: Yes. I agree with Senator Bennett. We were very serious here. We'll probably posture politically a couple days next week, if you missed that, but we did talk in there very seriously about the specifics, and we came to some agreement on highly important issues.
I will say from my standpoint, I've been through several Democratic caucuses in the House. I've talked among my colleagues. As the concerns of the Democratic members of the House were brought to me and to the speaker, I can say (ph), as I will, that we have been able to accommodate the bulk of them in very responsible ways.
And yes, we have got a situation where the president made a request. We are responding, I think, to the central thrust of that request, but adding, collectively, a number of things that will make people legitimately feel better about the overall approach. And, yes, we are on track, I believe, to pass it. The market should be calmed down.
We should note that some of us have been invited to go to the White House today to try to break a deadlock. We're glad that we'll be able to go and tell them that there really is not much of a deadlock to break, but I'm always glad to get to go to the White House.
PHILLIPS: All right. You heard it from both parties there, Democrat and Republican. They're holding a live news conference on the Hill. You heard it. They say they have a plan. They are going to respond to the president with regard to this federal bailout plan. They believe it will pass the House, the Senate, and be signed by the president.
Ed Henry, real quickly, we're still not hearing when, though, when they will do that. And if -- and obviously it is. It's up to all three parties here to sign off.
HENRY: Let me read the tea leaves. I've been around long enough to tell you. Once these Democrats and Republicans start patting each other on the back, they're pretty close to finally passing something. They're congratulating each other. The devil will be in the details, whether this is actually going to help the situation.
But my -- what I have been hearing from people on the Hill in recent days, is the hope would be that they could try to get something on the House floor as early as tonight or tomorrow. The Senate, it usually takes a little longer. That could mean Friday or even Saturday. Senate Majority Leader Harry Reid talking about a rare Saturday session. They obviously want to get this done by the end of the week, get it done, the key being before the markets open next Monday. Because the markets are anticipating this. They -- that's why there's so much urgency. That's why the president spoke last night.
And one final political point that will be interesting is John McCain got off the campaign trail to say he wanted to try to break the logjam. You're going to immediately start hearing Democrats, I bet, saying, "Wait a second. This deal was already being hatched before John McCain even got here. He's only been here now in Washington for about an hour, and now we've got principles for an agreement. And as you heard Barney Frank say, why do we even need to go to the White House at 4 p.m. if there's -- there are no more sticking points?
So already you're going to see both sides posturing over whether this was just a stunt by John McCain or whether, by him coming to Washington, whether that really broke the logjam or not, Kyra.
PHILLIPS: All right. Ed Henry at the White House. Thank you so much.
HENRY: Sure.
PHILLIPS: And speaking of posturing, if you were with us last hour, you heard the governor of Mississippi declare tomorrow night's debate at Ole Miss is a go. But we're still not certain -- entirely certain if that's the final word.
CNN's Suzanne Malveaux in Oxford for us.
You had a chance to even talk to the vice chancellor, Suzanne. A lot of people are wondering, is it going to happen or not?
SUZANNE MALVEAUX, CNN CORRESPONDENT: Kyra, I also had a chance to talk to the governor, ask him that question. What does he base this on, the fact that this is going to be a go? Is it based on any current conversations?
He says this is based on previous commitments by both of these candidates. So obviously, there's a certain sense of optimism.
But I want to show you. This is the campus newspaper here, and this really is the question, "Will he show?" There are a lot of people who aren't necessarily as confident as the governor as to whether or not McCain is going to show.
And there's a lot of people, some students, some faculty, hundreds of volunteers, who are very frustrated, even angry at this latest development.
But I did have a chance to talk to the vice chancellor, Gloria Kellum, and she told me that she is in constant contact, about an -- every hour or so, with the debate commission. That is ultimately the group that is going to make this decision. They're the ones who are talking to the campaigns, and they are still optimistic that this thing is going to happen tomorrow. Take a listen. (BEGIN VIDEO CLIP)
GLORIA KELLUM, VICE CHANCELLOR, UNIVERSITY OF MISSISSIPPI: The University of Mississippi works regularly with the commission. We've been in contact with them since yesterday afternoon, and we're all working together to make sure that this debate comes off on Friday night.
MALVEAUX: Have they told you that John McCain is going to show up tomorrow, that this is going to be a go?
KELLUM: This -- the commission has not told us that, but we all -- the commission, the university, all of us -- expect this to be here.
(END VIDEO CLIP)
MALVEAUX: University officials say that, Kyra, this is, to cost anywhere from $5.5 million. That is the kind of investment that they have put into preparing for this debate, through private donations. They say there are hundreds of volunteers, there are hundreds of employees that are involved in this.
But they are acting on the assumption here that this is going to happen, and there's signs of that everywhere. We got our press credentials for about 3,000 of us that are expected tomorrow. I was in the hall where the debate is taking place, and there are two podiums that are set up there on stage.
They say that they believe, when it's all said and done -- there's a lot of arm twisting that's happening now behind the scenes -- that these two candidates will be on that stage tomorrow night -- Kyra.
PHILLIPS: And a lot of angry people there, as well. Suzanne Malveaux, live from Oxford, appreciate it.
And just a bit later in the hour we'll go live to Oxford, Mississippi, to hear what the mayor has to say about tomorrow night's scheduled debate. How would he feel if it didn't happen?
You might want to sit down for this. It the huge government bailout plan passes, your share of the national debt could be a whopping sum just over a year from now. We're going to find out more about the true cost of the bailout.
And it's stirring outrage in Louisiana. A state lawmaker has come up with an idea to pay four women $1,000 to get their tubes tied. What do you think of that?
Off the Carolinas a big storm is brewing. Up and down the East Coast, the latest. Healthy beauty is a journey.
(COMMERCIAL BREAK)
PHILLIPS: It's not a tropical storm, but it's sure acting like one. Take a listen.
(BEGIN VIDEO CLIP)
(SOUND OF WAVES CRASHING)
(END VIDEO CLIP)
PHILLIPS: Low pressure system off the Carolinas is expected to bring gusty winds, high surf and dangerous rip currents to much of the East Coast over the next few days. These scenes in Nag's Head along South Carolina's Outer Banks, gale warnings now in place from Georgia to Massachusetts. In some areas waves could top 20 feet or more.
And coastal Virginia right in the middle of the bad weather. The storm's rain and high winds have caused flooding and power outages. About 6,000 homes and businesses from Norfolk to Virginia Beach were without power this morning. Because of the gusty winds, restrictions are in place on the Chesapeake Bay Bridge and tunnel.
Meteorologist Chad Myers, keeping track of what's going on right now with that storm.
Chad, we were talking about how we spend time in Duck (ph) every year.
CHAD MYERS, CNN METEOROLOGIST: Yes, I know.
PHILLIPS: We've been to all those -- the exact area.
MYERS: Well, when I lived in Richmond, that was an easy drive. Right all the way down to Duck, went through Elizabeth City.
So here's what's going on. You have all of this wind blowing onshore. And that wind is taking water with it. Kind of like a storm surge. No, it's not 10 feet, but it's a couple of feet. It's three feet in some spots. Especially pushing up into the Chesapeake. And that can be enough when you've got your boat sitting on a dock that's, you know, on pilings. Your dock's not coming up, but your boat is. There's a problem them. So that's why a lot of those docks do go up and down.
There's the storm system right there. It's going to come onshore right in between North Carolina and South Carolina. It does not have a name. It does not have tropical characteristics. It does not have an eye, but it does have wind and we do have some beach erosion from this, as well. And an awful lot of rainfall from D.C., to Baltimore, Richmond, Virginia and the like.
This is what we have. Just a little bit ago, from WVEC, before they packed it in for their noon live shot. Look at these waves. I mean, this is the Outer Banks. And this is going to do some beach erosion damage here to the Outer Banks. Even had some over wash yesterday where some of the roads, the road, was closed, because you can't drive through that. A couple of the SUVs were allowed, but smaller cars were not. You could see that again at high tide for today. What we will have is airport delays up and down the East Coast, so if you're flying today or for tomorrow, you better pack some patience. It could be hours and hours as this wind gets closer inland and so does the water -- Kyra.
PHILLIPS: All right, Chad. Thanks so much.
MYERS: You're welcome.
PHILLIPS: Well, less than two weeks after Hurricane Ike battered the Texas coast, a big worry for insurance companies. Claims are starting to pour in, and right now at least 60,000 people have filed. And thousands more are in the pipeline.
The state's insurance commissioner says that that could put some insurance companies at financial risk. In hard-hit Galveston, folks are finally starting to pick up the pieces and plan for the future after they were allowed to return home yesterday. There's still no reliable electricity, safe drinking water, medical care or even sewer service.
It's been a wild gas chase for a lot of people here in Atlanta, Georgia. A pump without a plastic bag on the handle or a "no gas" sign is hard to come by, thanks to supply issues from Gulf Coast refineries.
But Georgia's governor says that gas should flow more freely, now that the EPA has eased up on some pollution restrictions for the short term. Any available gas equals happy and relieved buyers and sellers.
(BEGIN VIDEO CLIP)
PETER HYMAN, GAS TRUCK DRIVER: I got a hug from the attendant this morning. She came out and gave me a big hug: "Oh, I'm so happy to see you." That's a first in eight years.
(END VIDEO CLIP)
PHILLIPS: Well, it could be a week or more before things get back to normal.
And it looks like the biggest Chevy dealers in the country, out of gas, so to speak. Bill Heard Enterprises has shut down all 14 of its dealerships, blaming a perfect storm of high fuel prices, a lot of gas-guzzling inventory, and the credit crunch.
The company has been in financial difficulty for some time. And GMAC continued credit for some dealerships last month. About 2,700 people in seven states will now be out of work.
A Louisiana lawmaker accused of adding insult to inequality. Oh, and he's also being called a racist. Selling -- sterility as a way to welfare costs? Well, I'm going ask about it, live.
And talk about getting back to your roots. This former pro basketball player is shooting for an even higher goal thee days. A portable, safe, and healthy food for everyone. We love this story and think you will, too.
(COMMERCIAL BREAK)
PHILLIPS: Well, there's a little (ph) optimism on Wall Street today, despite a batch of disappointing economic reports and a worrisome forecast from an influential company. Susan Lisovicz at the New York Stock Exchange with more on today's rally.
Hey, Susan.
SUSAN LISOVICZ, CNN CORRESPONDENT: Hey, Kyra, it's nice to see, because the Dow's given up 560 points Monday through Wednesday. Investors today cheering reports of progress in Washington. Deliberations on the treasury's $700 billion dollar bailout plan is giving a big boost to stocks, especially financial stocks that could directly benefit, and for the moment, Wall Street seems to be discounting a trio of weak economic reports. New home sales tumbled 11.5 percent in August, to their slowest pace in 17 years. It was a record drop in prices, too.
Meanwhile, initial jobless claims rose much more than expected last week to nearly 500,000. That's the highest number of weekly claims since September of '01. Economists get nervous when they see 400,000. So 500,000 is definitely a negative.
And durable goods orders, these are items that are meant to last three years or more, anything from toasters to airplanes, fell 4.5 percent. Demand for autos and airlines -- airplanes, in particular, fell sharply.
General Electric shares right now are up 4 percent, even though the bellwether company lowered its earnings forecast for the quarter and year, citing unprecedented weakness, and volatility in the national markets. GE makes light bulbs, makes jet engines, but it also gets about half its profits from its GE finance unit.
Checking the numbers, lots of green. The Dow Industrial are up 244 points, or 2.25 percent. The NASDAQ, S&P 500 also up 2 percent, as well.
And while the bailout progress may have investors cheering, well, they're buying inside. Not everyone is thrilled outside. Rallies against the rescue plan scheduled to start at 4 p.m. Eastern today in more than 130 cities across the country.
And this morning protesters gathered outside the NYSE, picketing "No free ride for Wall Street." It was noisy, and it just ended. Disrupted pedestrian traffic but was otherwise peaceful, Kyra.
Back to you.
PHILLIPS: Sounds good. Thanks, Susan.
Assuming Congress agrees on some kind of astronomical financial bailout package, where do we get the money? If you have a credit card, you probably have a pretty good idea (COMMERCIAL BREAK)
PHILLIPS: Hello, everyone. I'm Kyra Phillips, live at the CNN world headquarters in Atlanta. And you're live in the CNN NEWSROOM.
1:26 Eastern Time. Here's some of the stories we're working on right now.
Obama, McCain and Bush, all three meeting at the White House later this afternoon, along with congressional leaders from both parties. The topic: taxpayer and homeowner protections within the bailout deal.
Also in Washington today, the corruption trial begins for Alaska Senator Ted Stevens. Prosecutors say that he took hundreds of thousands of dollars in freebies and home improvements and thumbed his nose at the public's right to know. The defense blames Stevens' oil contractor friend for the legal mess.
And Pakistan's president claims the military fired flares to warn off a pair of U.S. helicopters today. They felt the aircraft had crossed into their territory from Afghanistan. U.S. officials say that there was no border crossing and there were no damages or injuries.
Let's talk about sticker shock. Spending $700 billion to rescue the financial system would be hard enough, if Washington had the money. But it doesn't. Not a penny. So what's all the discussion about?
CNN's Christine Romans fills in the blanks.
(BEGIN VIDEOTAPE)
CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): Just where is $700 billion going to come from? Where it always does.
UNIDENTIFIED MALE: The treasury doesn't have $700 billion in a big old safe. We have to go borrow it.
ROMANS: The piggy bank is already empty, and the government borrowing to the limit. To pay for this bailout, Treasury Secretary Henry Paulson wants Congress to raise the debt ceiling to a staggering $11.3 trillion. Talk about living beyond your means.
Filmmaker and author of "I.O.U.S.A.," Addison Wiggin.
ADDISON WIGGIN, AUTHOR, "I.O.U.S.A.": That money just gets tacked onto the bill for passing on to future generations.
ROMANS: Wiggin calculates the bill for everything the government promised but hasn't yet paid for, like Social Security and Medicare, nears $53 trillion, and by the year 2010, your share will reach $38,000.
WIGGIN: The government has money -- is spending beyond its means to a level that private citizens could never even imagine and even Wall Street banks wouldn't dream of.
ROMANS: And that's before the proposed $700 billion Wall Street rescue. That's got Congress wringing its hands over the enormous taxpayer-funded bailout and the candidates fine-tuning their messages.
Many economists say big tax cuts and new health care programs get less likely by the minute. Ballooning deficits are more likely. It's still unclear how much this would really cost.
BEN BERNANKE, CHAIRMAN, FEDERAL RESERVE: I recognize that this is always due -- there's a $700 billion program -- but again the fiscal cost of it is going to be much, much less than that.
ROMANS: Because the government hopes to someday sell the toxic securities it buys from the banks.
(END VIDEOTAPE)
PHILLIPS: And next hour we're going to dig into Wall Street's CSI. I'm going to ask a forensic accountant how the FBI is going about its criminal investigation of some former Wall Street powerhouses.
And if you caught President Bush's speech to the nation last night, you may have had a hard time sleeping. You may also have thought what a difference a few short months can make in the presidential perspective. Take a listen and note the dates in the upper right corner.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Ours is a belief that, one, we shouldn't bail out lenders. And so -- we shouldn't be using taxpayers' money. So OK, you made a lousy loan; therefore we're going to subsidize you.
This economy rests in the hands of the American people, not in the halls of our government.
Our financial institutions are strong. And that capital markets are functioning efficiently and effectively.
We can have confidence in the long-term foundation of our economy.
Major sectors of America's financial system are at risk of shutting down. The government's top economic experts warn that, without immediate action by Congress, America could slip into a financial panic, and a distressing scenario would unfold.
(END VIDEO CLIP)
PHILLIPS: Well you saw it right there. You saw before and you saw last night. It was a stark warning and an equally stark contrast from the recent past. Well that was also the talk of our morning meeting. (BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: The president comes out and says we have to do this. If we don't do this bailout then jobs will be lost.
PHILLIPS: You know what's interesting? I don't think a lot of people believe in --
UNIDENTIFIED FEMALE: No. I don't either.
(CROSSTALK)
PHILLIPS: -- and I think if we take the latest polls about do you believe him, do you trust him?
(CROSSTALK)
UNIDENTIFIED FEMALE: Very low.
UNIDENTIFIED FEMALE: I think it was just to get Congress to hurry the hell up.
UNIDENTIFIED MALE: Kyra mentioned the polls. I don't know that we've done one, but Marist (ph) released last night. And I don't know the date that it was taken, but 60-something percent said they thought that they ought to enact it immediately.
UNIDENTIFIED MALE: Bush gave this speech to try to people we're not bailing out Wall Street, we're not bailing out the fat cats, we're rescuing the economy.
UNIDENTIFIED FEMALE: Do we ask the question --
PHILLIPS: Is that how we would pose the question?
UNIDENTIFIED FEMALE: And is Congress going to pay attention to him. That's the other good question. Do they even care what he's going to say? He's a lame duck.
PHILLIPS: There you go.
UNIDENTIFIED FEMALE: I think people will really sound off on that.
(END VIDEO CLIP)
PHILLIPS: And that leads us to our e-mail question: Did President Bush sell you on the bailout?
Shoot us an e-mail us at cnnnewsroom@cnn.com. We'll read them later in the hour.
Well it was an idea born in a brainstorming session we're told. Cost-cutting by tube tying. A Louisiana state lawmaker thinks paying poor women not to parent could be a win-win way to shrink welfare spending. This story has been a talker around Louisiana and around the table at our team's morning meeting.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: He is considering a plan that will pay poor women $1,000 to tie their fallopian tubes.
VOICE OF CORINNA, GUEST BOOKER: Just to clarify, I did call him and speak to him. And he said this was leaked.
PHILLIPS: It's just an idea that he's floating. He hasn't written up any legislation or made any formal proposals.
CORINNA: He did say he's gotten phone calls from people all over the world --
UNIDENTIFIED FEMALE: I'm sure.
CORINNA: -- in the past day or two and e-mails from those people asking him if this is for real. And he also says he's gotten slightly more people saying they're in favor of it than against it.
UNIDENTIFIED MALE: Sounds like eugenics to me.
UNIDENTIFIED FEMALE: We should book.
PHILLIPS: How -- who was brainstorming? Where was it? What were the circumstances?
(END VIDEO CLIP)
PHILLIPS: OK. So here he is to answer all those questions. Louisiana state representative, John Labruzzo.
John let's get right down to it. Paying a woman $1,000 to tie her tubes. Was this your idea? And who else was involved in this brainstorming session?
JOHN LABRUZZO (R), LOUISIANA STATE HOUSE: Well, in my office, of course, we're trying to deal with the problem in Louisiana and particularly the problem of generational welfare, where -- that's becoming a big problem. And you saw that in the evacuations of the storms where these people were totally reliant on the government to handle their issues of evacuating from an imminent storm. And that's just a snapshot of what the problem is with these people being totally reliant on government to handle every issue.
And with the $700 billion bailout I think the taxpayers of America are kind of getting fed up and saying, look, you know, we need people to go to work, and to help pull the wagon instead of generation after generation jumping into the wagon.
PHILLIPS: Well John, instead of paying women $1,000 to tie their tubes, I mean, why not put the money or the efforts into education, into creating jobs, into maybe even if you want to go the pregnancy way, birth control and education with regard to that? LABRUZZO: Every one of the ideas you brought up were talked about in the brainstorming session. Obviously, the media thought this was the one that they can get some ratings off of -- and to only talk about this idea. We talked about getting involved in the community. How do we reach out? How do we give avenues to where these people can see other examples of, you know, how to get out of poverty, how to get out of welfare.
We talked about a lot of those issues. This was one that was brought up that the media grabbed hold of because it gets ratings.
PHILLIPS: Well, you're also getting written about from all over the country, and I know you've been getting a number of calls. We've even gotten a number of calls. This quote coming from the "Times Picayune," your local paper, from September 25th, an editorial saying that you are, "... the Jessica Simpson of the Louisiana legislature, known for boneheaded ideas. There's nothing funny about resurrecting heinous ideas, the same ideas that led to forced sterilization of the poor and mentally ill disabled in this country. It's also an idea that Nazi Germany carried to a horrible extreme."
What do you think about the criticism that you're getting?
LABRUZZO: Well, whenever somebody has the brass to stand up and say, hey look, this is a problem, generational welfare is a problem, the people on the other side, politically, they realize that's their voting base and they don't want anybody messing with appointing or shining the light of day on the problem of -- these people don't want to solve the problem on the other political side, because this is their voting base.
So those are the people that you are getting the criticism from. Bonehead ideas -- if dealing with generational welfare is a bonehead idea than I guess I'm boneheaded. But I think it's a problem that we need to deal with and particularly if this economy starts to turn around -- people are going to get fed up with everybody jumping in the wagon and them supporting -- and their having to support everybody with fewer and fewer people able to pull the wagon.
PHILLIPS: Well John, if you look at numbers according to the U.S. Census Bureau, and this for 2006 to 2007, the poverty rate for families with kids was 17 percent. OK? However, the poverty rate for adults with no kids was even higher -- 23 percent. So doesn't that blow your theory?
LABRUZZO: Well I can only speak to Louisiana. And I'm a representative of Louisiana.
PHILLIPS: That is Louisiana. That is the state of Louisiana.
LABRUZZO: In Louisiana the problem of generational welfare is a big problem. And we need to deal with it. And that's what we were brainstorming about.
I don't think this would have ever made it to drafting in legislation. But, of course, the media wants to have ratings and this is what they want to talk about, instead of talking about the issue which is how do we get more people from welfare --
PHILLIPS: But we are talking about the issues --
LABRUZZO: -- excuse me, from welfare on to the --
(CROSSTALK)
LABRUZZO: -- into paying taxes and being productive members of society. And it's better for them, it's better for everybody involved. That's the point.
PHILLIPS: But isn't that education? Isn't that creating jobs? Isn't that really getting into your community and trying to help the people versus saying, tie your tubes, we'll pay you $1,000? Why not take these people and say, hey, we got jobs here, we got better education here. let's put money -- hey I lived in New Orleans and worked in New Orleans. It is a shame, the conditions that so many of these schools are in, and how much money is divided in the city. You have the power to really make change there. Instead of paying people to tie their tubes, you could put that money into incredible educational opportunities.
LABRUZZO: All of those things are on the table. And we're talking about all of these opportunities.
And once again in Louisiana, we had a tremendous influx of illegal aliens so that's bringing down the economy even more. That's another issue that some of my opponents on the other side of the aisle don't want to bring up. And they don't want to talk about.
So it's a big problem, and it needs to be addressed and if all else, we at least brought up the issue of generational welfare. It is a problem and I hope we can address it and come to some solution that works. Obviously, this one's probably not it. But let's talk about t.
PHILLIPS: All right. And let's see what you can do. State representative John Labruzzo --
LABRUZZO: Thank you so much.
PHILLIPS: -- appreciate it.
Despite questions about tomorrow night's presidential debate, the University of Mississippi and the city of Oxford are moving ahead with plans for the big event. We're going to hear what the mayor has to say live in the NEWSROOM.
And if your medical costs are climbing as your savings shrink, Elizabeth Cohen's tips could make you feel better.
(COMMERCIAL BREAK)
PHILLIPS: Well we hear about food shortages around the world. But there are people in the U.S. cities who either can't get or can't afford simple, healthy and safe food. That's where former pro- basketball player Will Allen comes in. He's making urban the new rule. Planting gardens, knocking down fences and cultivating a new generation of farmers.
(BEGIN VIDEO CLIP)
WILL ALLEN, URBAN FARMER: Community Foods Center is what we've developed here. That's a place where people can come for training to learn how to grow food, how to grow soil, how to grow energy. That's what we do here, the growing power.
Kids are the most powerful because you can see it in their faces. They show it in so many different ways and they appreciate what you do. That's what drives me. It's the future.
(END VIDEO CLIP)
PHILLIPS: And Will Allen is being called a genius. He actually received the Genius Award. It's through the MacArthur Foundation Grant -- half a million dollars. He continues to work on his project. He joins me now live from Milwaukee.
Great to see you, Will.
ALLEN: Great to talk to you.
PHILLIPS: Well tell me, how did a professional basketball player turn into a farmer for the inner city? I love it. How did it happen? Why did you do it?
ALLEN: Well I grew up on a farm right outside of Washington, D.C. on the border of Bethesda and Rockville, Maryland. And I come from a farm family. My father was sharecropper and my mother's family in South Carolina -- both from South Carolina -- were both involved in farming.
PHILLIPS: So why is it, Will, that low-income families can't get fresh vegetables, fresh fruits? Why is it such a challenge?
ALLEN: Well, in many urban cities, the major grocery chains have pulled out for whatever reason. The corner stores primarily carry beer, cigarettes, those sort of things and in the old days those corner stores provided fresh, healthy, affordable food for folks. And then chain stores came in and did some experimentation and then they moved out. So we have a lot of food desert areas throughout the whole country. And we're in a food crisis, and the most vulnerable, of course, are our youth and our elderly.
PHILLIPS: And you know what? That has -- I've watched how these kids flock to you. They are in awe of you, not because you're about seven foot tall, but that you are doing amazing things for them.
How do you encourage them to get involved? Because I know you build gardens with them, you're showing them how to farm and they're wanting to come and meet you after school and take part.
ALLEN: Yes, we have our -- our center -- the main thing is when you go into communities, inner city kids don't have a lot of choices to do very much. So when we pull in and we're going build a community garden, 40 kids will just come out of their houses. And it's at that point that we get them engaged because you can either chase them away or get them engaged, and we get them engaged and give them a piece of the garden, and they become owners of it.
And they learn about where their food comes from. They learn better eating habits. They do better in school. It's definitely a crime-fighting tool.
PHILLIPS: And you've also figured out how to take low-cost farming technologies and implement them in these poor areas, right? What have you been able to get going specifically?
ALLEN: Well, one of the things that we do is this vertical system to getting a project started. The first thing is organizing around food, doing community engagement, getting the community on board. And then we grow soil, because most of our soil inside our cities, and even in our suburban and rural areas, is contaminated. So we grow healthy soil. We make compost. This year we'll do 6 million pounds of food waste, diverting food from the landfills and using that waste to make compost, that carbon waste, at about 75 percent -- things like cardboard, newspaper and things like that, and organic waste in the form of nitrogen. Things like, oh, apples, oranges, food waste, pre-cooked food waste, and then combine those things and grow soil.
And then when we can grow soil, then we can grow food. And when we grow food, we can grow people. And when we grow people, we can grow communities. Because we really can't have a sustainable community -- everybody talks about this, this word sustainability that everybody's throwing around -- but we cannot develop sustainable communities without sustainable food systems. So without healthy food I don't see how we can grow communities.
PHILLIPS: Well, you're doing it, and I'm seeing the communities grow. And not only that, but you're such a role model to ball players nowadays that just have so much money and don't give back. You are an amazing man, Will Allen. Thank you so much for sharing your project with us.
I want to plug it. Growingpower.org -- donate, get involved, support Will Allen.
Will, congratulations on your award.
ALLEN: Thank you very much, Kyra.
PHILLIPS: My pleasure.
Months of blood, sweat and tears for Oxford, Mississippi, and Ole Miss, as they prepare for tomorrow night the debate between Barack Obama and John McCain. So how would the city, and the university, feel if all their plans came crashing down? Joining me now, Oxford mayor, Richard Howorth.
Richard, this has got to be a tough time for you right now. Probably biting your nails wondering, OK, is it going to happen?
MAYOR RICHARD HOWORTH (D), OXFORD, MISSISSIPPI: Well, actually, no. We're still in a ready mode. We've been in the ready mode for about a year and we think it's going to happen. We're not thinking about the alternative right now. So we're still excited about it and have a really positive attitude.
PHILLIPS: OK. Have you gotten the go, a definite green light? Or are you still just keeping your fingers crossed?
HOWORTH: The -- as far as I know, the green light has never been off. The debate commission and the university never said that we were slowing down or canceling or postponing or anything else. So we've been on go since, you know, day before yesterday.
PHILLIPS: OK. So even though John McCain has come forward and said, hey, we've got to delay this, I need to go back to Washington to deal with economic problems, I'm encouraging Barack Obama to do the same thing, you're not concerned about that? You think he's just coming out and saying that but it's going to be all systems go?
HOWORTH: No, no. Not at all. Of course we're concerned about that.
PHILLIPS: OK.
HOWORTH: Yes. Absolutely.
PHILLIPS: So you think there may be a delay still?
HOWORTH: Well, there could be a delay. These things are happening, as someone has said, above my pay grade. So I'm just -- we're in a wait and see mode, but --
PHILLIPS: Well put it in perspective for us.
You know --
HOWORTH: Well I think if you read the --
PHILLIPS: Go ahead.
HOWORTH: OK.
I was going to say if the read the tea leaves of the events that have been happening today, it seems, you know, fairly positive, and it seems like, you know, things may resolve themselves somewhat temporarily. People are coming together. They're working together. So, you know, we still tend to believe it's going to -- the debate's going to happen here tomorrow night.
PHILLIPS: So what do you think? Is this the biggest thing to hit your area since the Civil Rights movement? We think back to the days of James Meredith integrating --
HOWORTH: Correct. PHILLIPS: Yes -- and just seeing how your community has just rallied for weeks, holding these forums, the scouts handing out flags, holding picnics and concerts. It's amazing.
HOWORTH: Right. It's just been a great vibe through the community. We're so excited about it. And we think it's an opportunity to show Oxford, Mississippi, the way we know it, the way we think of it, and in a very positive light.
You mentioned 40 years ago -- that was an event that we could not control. The media was here from everywhere. They weren't really invited that time. This time, you're invited. We want you here. We want to see you. We want to talk to you. We want you to see our town for what it is.
PHILLIPS: Well and we hope we see that debate coming up Friday night.
Richard Howorth, Oxford mayor, appreciate your time.
HOWORTH: OK. Thank you, Kyra.
PHILLIPS: You bet.
A conversation about cell phones and cancer. House lawmakers want to zero in on what the science says in today's hearing.
(COMMERCIAL BREAK)
PHILLIPS: So, are cell phone is -- as bad call, medically speaking? That's what House law makers want to know from their expert panel in today's hearing on Capitol Hill. Different studies come out all of the time. Just the other day, we heard about reports concerning mobile phones effecting men's sperm counts. And then, there was the scientist from the University of Pittsburgh Cancer Institute, who warned his staff about cell phone use. He's going to be testifying today. So if anything new comes out of that, we will definitely let you know.
Now, some new research could benefit future stroke victims. A European study found that a clot-busting drug can be used to help more parents than those who currently use it. The drug's label warns against using it more three hours after the symptoms start. But researchers say the window should be extended by about 90 minutes. We should let you know that the study was funded by a partner of the company that makes the drug.
Well, we're all looking to save money these days, right? Medical bills can be a big strain on people's budgets. But there are easy things that you can do to do to cut costs and not the quality of care. That's the focus of this week's Empowered Patient.
Here's medical correspondent Elizabeth Cohen with one of the No. 1 ranked columns, what do I say, blogs? How do I refer to them --
ELIZABETH COHEN, CNN MEDICAL CORRESPONDENT: Columns, you can call them.
(CROSSTALK)
PHILLIPS: I got empowered a number of times by what you had to say.
COHEN: Well, that is great. Thank you. I'm so glad.
PHILLIPS: Tell us about it.
COHEN: Well, you know what? People think, oh, it must be a big challenge to save money on medical costs because pricing for medical things is so complicated. What in the world could I do? We're going to send you to eight web sites that will teach you -- each one of them has a different trick for how to save money.
In the column today, you are going to learn how to save money for example on your contact lenses. There are some pretty easy things you can do. Dental care. How to find discount dental care that won't make your teeth fall out. And drugs. How to buy inexpensive prescription drugs. There are some very, very specific things you can do. We're also going to tell you how you can save money on the hospital bills and all of this stuff is at CNN.com/health, right now.
PHILLIPS: Well, can you tell me more about hospital costs, because that's one that people are always asking about.
COHEN: Right. Because when you go to the hospital, you get this bill that's about this big and it seems to be written in Greek --
PHILLIPS: Right. Some things you don't even understand.
COHEN: Right. You don't totally don't understand it. And so we have some links to some people who can help you the decipher that bill. And we talked to one gentleman who got a huge bill, $15,000. He got on the phone, he cut that bill in half with one phone call. And we will tell you how to use the tricks that he used.
PHILLIPS: What about tax deductions.
COHEN: You know what? Most people don't know that there is a tax deduction for medical expenses of the expenses get pretty high. But most people don't even use it even if they can use it because it's so complicated. So we send you to some links that help you to use that deduction if you are eligible. Because that can come out to be a lot of money.
PHILLIPS: All right. CNN.com. Look for your column.
COHEN: Thanks.
PHILLIPS: Thanks so much.
OK. Well, just because you're ghost, that doesn't mean that you should let the abs or delts go all soft. We might be looking at Caspar the healthy ghost, here. (COMMERCIAL BREAK)
PHILLIPS: Hey, Mr. Ghost, did you swipe your card first? Check out the security camera in a gym in Kansas. Now, is that an aberration trying to live a healthier after lifestyle, maybe looking for a spotter? Or does the gym need to get a scare up a Swiffer and dust the dumbbells?
(BEGIN VIDEO CLIP)
KIM PETERSON, GYM OWNER: My 8-year-old said, maybe grandpa's just making sure that you're doing OK in your new business, mom.
SHARON BOHM, POTENTIAL GYM MEMBER: It could be a spirit, you know. Nothing's impossible.
(END VIDEO CLIP)
PHILLIPS: Well, whatever it is, it set off the motion sensors nine times between 2:00 and 4:30 in the morning.
She came, she saw and she conquered. Everything at the United Nations except the press. Jeanne Moos looks at Sarah Palin's relationship with the media.
(BEGIN VIDEOTAPE)
JEANNE MOOS, CNN CORRESPONDENT (voice-over): Welcome to the photo-op follies --
UNIDENTIFIED MALE: Please step all the way over.
MOOS: -- Where handlers whisper urgent orders to the press pool. The pool gets to stay for a whopping 30 seconds or so getting pictures then gets shown the door. Sarah Palin --
GOV. SARAH PALIN (R), VICE PRESIDENTIAL CANDIDATE: It's so nice to meet you.
UNIDENTIFIED MALE: It's so nice to meet you.
MOOS: -- raced around to half a dozen of these in two days.
CRAIG FERGUSON, "THE LATE LATE SHOW WITH CRAIG FERGUSON": It's kind of like she's speed dating the world leaders. (INAUDIBLE), I am Pakistan, I like nuclear weapons, long walks on the beach. And you?
MOOS: Comedian Craig Ferguson was prophetic. Pakistan's leader did act almost like it was a date, telling Palin how gorgeous she is.
UNIDENTIFIED MALE: You are even more gorgeous in life.
MOOS: Gushing over her popularity.
UNIDENTIFIED MALE: Now I know why the whole of America is crazy about you. MOOS: When a photog (ph) asked for another hand shake, threatening a hug.
UNIDENTIFIED MALE: If he's insisting, I might hug.
MOOS: But the press and Governor Palin aren't so lovey-dovey amid complaints that Palin is dodging questions. Which brings us to the most frequently heard phrase in a photo op.
UNIDENTIFIED MALE: Thank you very much. Pack up the (INAUDIBLE), thank you.
MOOS: It's not gratitude, it's attitude. Commonly used to drown out pesky questions.
UNIDENTIFIED FEMALE REPORTER: Governor, what have you learned from your meeting?
(CROSSTALK)
UNIDENTIFIED FEMALE: Thank you, pool. Thank you so much pool, we're going to head out.
UNIDENTIFIED MALE: Thank you, guys, please. Thank you. Thanks a lot. Thank you very much. OK, guys. Everybody keeps moving.
MOOS (on camera): In the world of photo op, thank you doesn't always mean thank you. It means shut up and get out.
UNIDENTIFIED MALE: Thank you, guys. Thank you very much.
UNIDENTIFIED MALE: Thank you.
UNIDENTIFIED MALE: Thanks, guys.
MOOS (voice-over): The press gets thanked all the way out the door.
UNIDENTIFIED MALE: Thank you. Please turn around. Thank you.
UNIDENTIFIED FEMALE: Great. Thank you.
MOOS: And when they finally did get a question answered, it wasn't much to be thankful for.
UNIDENTIFIED MALE REPORTER: Governor, how has your day gone so far?
PALIN: It's going great. These meetings are very informative and helpful.
MOOS: One thing the media can't say is that their job is thankless.
UNIDENTIFIED FEMALE: All right, guys, thank you.
UNIDENTIFIED MALE: Thank you, guys, too.
UNIDENTIFIED MALE: Thank you.
UNIDENTIFIED FEMALE: Thank you.
UNIDENTIFIED MALE: Everybody, please, thanks.
UNIDENTIFIED FEMALE: Thanks, guys.
MOOS: At photo ops the definition of thanks is --
PALIN: Thanks but no thanks.
MOOS: Jeanne Moos, CNN, New York.
(END VIDEOTAPE)
