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Congress Debates Bailout; WASPs Honored for WWII Heroics
Aired September 26, 2008 - 13:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The legislative process is sometimes not very pretty, but we are going to get a package passed.
KYRA PHILLIPS, CNN ANCHOR: Not pretty may be an understatement. The rest, wishful thinking? With Congress in chaos and the president on the sidelines, who will bail out the bailout?
CHRIS ROCK, COMEDIAN: The guy with one house really cares about losing a house, because he's homeless. The other guy can lose five houses, and still got a bunch of houses. Does this make any sense? Am I the only one that sees this?
PHILLIPS: Financial distress and the presidential race, as only Chris Rock can explain them. Wait until you hear what else he told Larry King.
And the original fly girls are back. The women pilots of World War II finally recognized as the heroes they are.
(END VIDEOTAPE)
PHILLIPS: Hello, everyone. I'm Kyra Phillips live at the CNN world headquarters in Atlanta, and you're live in the CNN NEWSROOM.
Game on. If we know nothing else about the turmoil engulfing Wall Street and Washington and the presidential race, we know John McCain will debate Barack Obama tonight in Mississippi. At least we think we know that for now. We also know that anything pertaining to any of this can and may change without warning.
McCain has said the debates could wait until a financial bailout plan was agreed to, but in that disastrous meeting yesterday afternoon at the White House, the bailout went belly up.
President Bush came out briefly this morning to say he understands lawmakers' reservation but still thinks there's no alternative.
(BEGIN VIDEO CLIP)
BUSH: There are disagreements over aspects of the rescue plan, but there is no disagreement that something substantial must be done. The legislative process is sometimes not very pretty, but we are going to get a package passed. We will rise to the occasion. Republicans and Democrats will come together and pass a substantial rescue plan.
(END VIDEO CLIP)
PHILLIPS: So closed door meetings are again under way on Capitol Hill but among staff members, not, we understand, lawmakers. And that's exactly where we start right now.
Brianna Keilar, are they back to square one?
BRIANNA KEILAR, CNN CORRESPONDENT: Not necessarily square one but not much past it, Kyra. I want to tell, I understand that we've actually got some lines now coming in from House Republicans who have had some issues with consensus. Let's listen.
(JOINED IN PROGRESS)
SEN. ROY BLUNT (R), MISSISSIPPI: ... We are going to negotiate seriously. I've already reached out to the negotiator, the other negotiators, to talk about our desire to get this done and to get this done with some additional free enterprise principles. Eric Cantor led a working group over the last 36 hours or so to put some of those principles on paper.
Clearly, the Democrats have a majority in both houses of Congress. If they want to do this by themselves, they can do this by themselves any minute they want to. If they want to do this with us, we're prepared to have that negotiation. I'm eager to be part of that negotiation.
I know our leadership team, our financial services committee, Spencer Bachus, are behind us in these efforts to make these negotiations work. And we plan to -- as a matter of fact, leadership staff, my staff and others from the leadership are meeting right now for the staff discussions that need to happen before this meeting of the principals today. And I look forward to that.
And as I told Chairman Frank earlier, we're going into these negotiations with every intention of having a real negotiation, of having a bill the House Republicans can vote for, and solving this problem and solving this as quickly as we can.
UNIDENTIFIED MALE: We've got time for a couple of questions before we go vote.
UNIDENTIFIED MALE: (INAUDIBLE) why this -- fully deputized, some of these talks before (INAUDIBLE). Democrats said they didn't know who they were negotiating with. It seems like Mr. Bachus was sort of undercut.
BLUNT: I've been in conversations with the administration and the speaker of the House all week. And there's nothing that was put on the table yesterday that Speaker Pelosi didn't already know about, nor the treasury secretary or the president.
Those conversations have been going on at that level, and I don't know what games were being played at the White House yesterday. A gang-up on Boehner, but if they thought they were rolling me, they were kidding themselves.
UNIDENTIFIED FEMALE: What insurance program do you prefer? Is that what you want more than anything? Can you lay out the specifics of what...
BLUNT: Our goal here in attempting to come to an agreement is to do our best to protect the American taxpayers. There are a lot of options in terms of how we do that, and we're not going to negotiate here in -- here with all of you. The last time I looked, you didn't have a vote.
UNIDENTIFIED MALE: Last question.
UNIDENTIFIED MALE: (INAUDIBLE)
BLUNT: There are a lot of proposals that are out there that will work. What we've got to do is to do our best on behalf of taxpayers. Thank you.
UNIDENTIFIED MALE: Thank you very much.
KEILAR: So as you can see there, just from the language that you're hearing, House Minority Leader John Boehner (sic) used, obviously, he felt ganged up on yesterday. House Republicans feeling cornered on this, because they're not onboard with what appears to be some sort of consensus between all Democrats and Senate Republicans.
Just to the refresh your memory, John Boehner is the one who was at that White House meeting yesterday, who expressed some concerns because House Republicans were not seeing eye to eye with Treasury Secretary Paulson and some of the other parties in the negotiations.
And -- but if you -- the man who we saw talking before him, that is Republican whip, House Republican Whip Roy Blunt. And this is kind of a development today. We understand now -- it has been put out officially, that Roy Blunt has basically been given the authority to represent House Republicans in negotiations. That was not the case last night.
So it does appear at this point that there is someone who can really stand up and represent the unit for House Republican, Democratic, Democrats in the House, Senate Republicans, Democrats in the Senate.
On the other hand, though, we have to focus on the fact there is still some major disagreements on the bailout proposal at this point, Kyra. I mean, House Republicans, they just are very much opposed to the idea of this taxpayer infusion of $700 billion in cash.
Even though you're hearing the other parties wanting to add things like CEO pay limits, taxpayer protection, House Republican opinions really have a problem with this. They are fundamentally opposed to it, and this is why. If you just listen to an explanation from Republican Congresswoman Virginia Fox.
PHILLIPS: All right. Brianna Keilar, being told not far from you, we've got Jessica Yellin on the phone, as well. She was there listening just outside the doors, once that GOP statement was made. We just heard from Minority Leader Boehner [SIC].
Jessica, he felt the White House was ganging up on him. Anything that you heard or got from Democrats and Republicans that we didn't see on camera just a minute ago?
JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: ... just heard is that they wouldn't endorse any particular plan. You know, we've been hearing this idea of this hybrid floated today, an option to the bailout package that's been negotiated.
When pressed on that repeatedly, even the leadership that was so in support of this, walking into the meeting, comes out and says they're not going to endorse that hybrid plan, and they're not going to endorse anything specific.
There's significant concern among the conservatives, again the fiscal conservatives, that none of these options is going to keep Secretary Paulson from just bailing out companies.
So the bottom line is, is there's still a great degree of opposition among those conservatives in the House conference, and it's not clear that they're unified at all.
On the other hand -- as you say, they are not unified, and it's not clear that they can get there by the end the day today. On the other hand, the fact that Roy Blunt is representing them is, as Brianna, said a sign they have a strong hand in there, somebody who can whip the conference together. And if anybody could do it, he is the man that could.
PHILLIPS: You make a good point. I think taxpayers want to see more than just bailing out high-paid CEOs and companies.
Jessica Yellin, we're going to continue to follow this.
As if this financial crisis weren't delicate and volatile enough, factor in the presidential campaign and both main candidates getting involved. Before he left for Mississippi, Barack Obama spoke briefly with reporters.
(BEGIN VIDEO CLIP)
SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: I am optimistic that we can get something done. I think that there is real progress being made this morning and last night, and I think it's important that the markets seem to be staying relatively calm at this point.
And at this point, my strong sense is that the best thing that I can do, rather than to inject presidential politics into delicate negotiations, is to go down to Mississippi and explain to the American people what is going on and my vision for leading the country over the next four years.
(END VIDEO CLIP)
PHILLIPS: Now, the McCain camp issued a statement saying, "The difference between Barack Obama and John McCain was apparent during the White House meeting yesterday, where Barack Obama's priority was political posturing in his opening monologue, defending the package as it stands."
Still quoting here, "John McCain listened to all sides so he could help focus the debate on finding a bipartisan resolution that is in interests of taxpayers and homeowners."
CNN's Ed Henry is at the White House where everything went off the rails.
Ed, let's go ahead and start with the politics. I mean, drama, drama, drama! You've got Democrats and Republicans going at each other. Nothing was really decided. At least we didn't hear anything.
Then you've got the treasury secretary getting on his knees and Nancy employees Pelosi saying, "Help a country out." Now you've got Minority Leader John Boehner coming forward, saying, "Oh, man, the White House ganged up on me."
ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, let's start with Henry Paulson. I think that's kind of a dramatic anecdote. Two senior Democratic aides told me late last evening that after this White House meeting broke down here in the cabinet room, some of the Democrats, including Barack Obama, Speaker Pelosi, went into the Roosevelt Room, the very historic room right near the Oval Office, and shut the door, even though it's not really their White House, technically, and just started plotting strategy. What are we going to do next?
And we had our cameras out here, and they thinking about what they were going to say to the stakeout crews about exactly why this meeting failed.
All of a sudden, I'm told, there's a knock on the door. The treasury secretary walks in and basically, literally, got down on one knee and said, "Speaker Pelosi, please do not go to the television cameras. If you go out there and you start attacking these talks and saying that it broke down at the White House, markets might tank. This thing is just going to completely go off the rails."
Now, I want to stress that people in the administration say and the Democrats acknowledge that Henry Paulson was sort of half joking when he got down on one knee. But it is a dramatic example of how this White House is in a very defensive crouch, if you will, defensive posture in trying too deal with the Congress.
Not just Democrats, but their own Republicans, who despite the president's primetime speech, all the lobbying, all the arm twisting, those Republicans on the Hill are still holding out. And they're not signing on to the deal that the president wants, even though the president keeps sounding the alarm bells and saying there's a crisis. We need to act now. He released this plan late last week, and yet most Republicans are still not onboard. That's a dramatic example of how the president's clout has been going up and down around here, Kyra.
PHILLIPS: So Ed, is it possible that nothing could happen? That the next president of the United States is going to have to take this over?
HENRY: Well, on one hand it is possible that nothing can happen, because there are a lot of Republican members in particular who are hearing from their constituents back home and saying, "Don't -- don't pass this," that this could be worse than doing nothing; that just writing a blank check, in their eyes, and also in their eyes, sort of bailing out Wall Street barons who did some bad things, is not the right way to go.
Now on the other thing, if Congress goes home soon without doing nothing and then the markets get worse and things, you know, just boomerang and just cascade, I suspect that a lot of lawmakers in both parties could pay the price in November for looking like they did absolutely nothing.
The final point I'd make is in terms of the presidential politics. It's sort of a mixed bag for John McCain right now. On one hand you have some Republican senators saying, look, by John McCain and then Barack Obama coming here to the White House and Washington, it really focused everyone's attention, it really got the negotiations going.
There are Democrats insisting, though, that the deal was coming into place, and by injecting presidential politics, it just blew it up.
I think if you cut through the spin on both sides, one thing that you have to say, in fact, is that John McCain at least blinked somewhat, because he had said at beginning of all this he didn't want to go to the debate unless there was essentially an agreement, some sort of a plan in place. Right now there's no agreement, but he's on a plane heading to that debate, Kyra.
PHILLIPS: Ed Henry with the politics. Thanks so much.
You also mentioned the markets. We're going to talk about the money. What does all of this mean for you, your pocketbooks, for CEOs, for companies, taxpayers, all of that? Paul La Monica of CNNmoney.com is going to join us with that in just a second.
Also, after a lot of doubt, the presidential debate will take place tonight. We're going to find out what a prominent radio talk show host and a nationally-syndicated columnist have to say about John McCain's decision to meet Obama face-to-face in Mississippi.
And they're reclaiming the skies. Women Air Force service pilots from World War II getting together for a big reunion. Guess who's flying that aircraft? We'll hear from them in just a minute.
(COMMERCIAL BREAK)
PHILLIPS: We are keeping track of two big stories for you this hour. The financial bailout plan on Capitol Hill. We're live from there. Can supporters and opponents put aside their differences and finally come up with an agreement? Big question today.
And the guessing game's over. On the other side of the screen there, live from Oxford, Mississippi, John McCain decided a short time ago he will debate Barack Obama tonight. He threatened to pull out of -- or pull out to work on the financial bailout plan in Congress, actually.
We're going to hear what a radio talk show host and nationally- syndicated columnist have to say about that in just a minute.
Well, we heard one of those House members talk about a second opinion. A lot of people questioned not just the treatment but the diagnosis. Will the economy really fall apart without a bailout plan?
Let's ask our resident money man, Paul La Monica of CNNmoney.com.
You know, Paul, we've been talking so much about the politics. But even within our morning meeting this morning, we were wondering, OK. Where is the direct benefit to us if, indeed, it passes?
PAUL LA MONICA, CNNMONEY.COM: Yes. I think, really, the problem that many American taxpayers are facing right now is that the benefit, in many respects, is a hope. It's a hope that, eventually, the government will be able to recoup a lot of this money that's being put on the line by selling off these soured mortgage assets and getting money back from them.
And then the benefit is that banks continue to lend to you and I so that we can get mortgages, car loans, send our kids to college.
That, however, is just a hope. And I think what a lot of people want in a bailout package is something more tangible, so that could be some relief for people that are already facing difficulty paying their mortgages or are already in foreclosure.
PHILLIPS: OK. So you say we hope. So really we don't know. We don't know if a $700 billion bailout plan will really bail us out?
LA MONICA: Yes. It's impossible to know whether or not it will work. The obvious hope...
PHILLIPS: Wow. That's risky. That's a lot of lending risk.
LA MONICA: It is very risky. I mean, it is a lot of money to risk. But that said, a lot of the highly-respected economists, market strategists and, of course, people within the administration are making a strong case that this will work; that it will lead a more orderly sale of assets that otherwise would have been just dumped in a panic, or even worse, left on the books of many of these banks, which could lead to more bank failures.
And we saw last night the biggest bank failure in history.
PHILLIPS: OK. So if there -- if a bailout plan doesn't go through, you're mentioning that more banks could tank. What else? How bad could it get?
LA MONICA: Really, what the biggest concern that most people I've talked to about the possibility of just doing nothing, and having that, let Wall Street just burn, is that it really isn't that simple. Yes, Wall Street will burn, but you know what? So will Main Street.
If companies are not able to get loans, that puts economic expansion at risk. Consumer confidence and spending would likely fall. That makes it even tougher for businesses to hire people, if people are pulling back on their spending. And it's just this huge ripple effect of a slowing economy that eventually leads to more job losses and more reduced spending.
So it doesn't help anyone to just say, "Let Wall Street go burn, and it's their fault we're in this mess. And we should all be suffering."
PHILLIPS: CNNmoney.com, Paul La Monica. And a lot of people are suffering. Appreciate your perspective, as always, Paul.
LA MONICA: Thank you.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: No Bush bailout!
UNIDENTIFIED MALE: No Bush bailout!
UNIDENTIFIED FEMALE: No Bush bailout!
(CAR HONKING)
(END VIDEO CLIP)
PHILLIPS: Suffering, and also a lot of taxpayers are seething with anger over the Wall Street bailout plan, and across the U.S. they've been showing that anger by taking to the streets, including here in Pasadena, California.
Protests also have taken places in some of the nation's biggest cities, including New York and Los Angeles. Reverend Jesse Jackson is helping lead a protest today in Washington, D.C.
Sarah Palin on the spot. The vice-presidential nominee defends herself on the foreign policy issue before a national TV audience.
(COMMERCIAL BREAK)
PHILLIPS: Now Sarah Palin's lack of foreign policy experience, that's one of the big issues critics have blasted her on since she was named John McCain's running mate. In one of her few interviews with the media, Palin sat down with CBS Evening News anchor Katie Couric, and the foreign policy issue was a key question.
(BEGIN VIDEO CLIP)
KATIE COURIC, ANCHOR, "CBS EVENING NEWS": You've cited Alaska's proximity to Russia in Alaska a part of your foreign policy experience. What did you mean by that?
GOV. SARAH PALIN (R-AK), VICE-PRESIDENTIAL CANDIDATE: That Alaska has a very narrow maritime border between a foreign country, Russia, and on our other side, the land boundary that we have with Canada. It's funny that a comment like that was kind of made to -- I don't know. You know. Reporters...
COURIC: Mocked?
PALIN: Yes, mocked, I guess that's the word. Yes.
COURIC: Well, explain to me why that enhances your foreign policy credentials?
PALIN: Well, it certainly does, because our next-door neighbors are foreign countries. They're in the state that I am the executive of. And...
COURIC: Have you ever been involved with any negotiations, for example, with the Russians?
PALIN: We have trade missions back and forth. We do. It's very important, when you consider even national security issues with Russia as Putin rears his head and comes into the airspace of the United States of America, where do they go? It's Alaska. It's just right over the border. It is from Alaska that we send those out to make sure that -- an eye is being kept on this very powerful nation, Russia, because they are right there. They are right next to -- to our state.
(END VIDEO CLIP)
PHILLIPS: Well, the Palin interview really got us talking in our morning editorial meeting today. How should we handle the issue of her foreign policy experience? Here's some of our discussion.
(BEGIN VIDEOTAPE)
TENISHA, EXECUTIVE PRODUCER: We have to move onto the Katie Couric interview with Sarah Palin. Tell me you guys saw it.
KATIE, PRODUCER: They had the question last night on Anderson's show. This kind of backfired on them. By waiting until now to bring her out, with a big network interview like this? Why didn't they start small?
PHILLIPS: Interesting. What about the passport thing. I wonder how many -- if we could gauge how many people don't have a passport?
UNIDENTIFIED FEMALE: Only 18 percent of Americans have passports last time I checked.
PHILLIPS: OK.
UNIDENTIFIED FEMALE: So I can check again.
PHILLIPS: We would take all governors across the U.S. Let's find out how many have a passport.
UNIDENTIFIED FEMALE: That would be great.
PHILLIPS: That would be great.
UNIDENTIFIED FEMALE: Well, but is that really the issue? I mean...
PHILLIPS: Everybody's bringing it up.
(CROSSTALK)
UNIDENTIFIED FEMALE: Yes. There's (INAUDIBLE) the article. They're slamming her for not having a passport.
PHILLIPS: The policy experience, not meeting with world leaders. Well, she doesn't even have a passport. So let's find out how many other governors don't have a passport. I mean...
MARILYN, SENIOR EDITORIAL PRODUCER: Just because the media is falling prey to that, I don't know that we should fall prey to that. I mean, I think -- I mean, whether or not she has a passport isn't going to -- isn't going to make somebody vote for her or not. I mean, that -- it has nothing to do with, like, the issues.
(END VIDEOTAPE)
PHILLIPS: Well, so you just saw it unfold. We talked about the Palin passport issue in our meeting and then went and did our own research. How many Americans do have passports? The State Department said at last count in April, 88 million Americans held U.S. passports. That's less than one-third of the population.
The women Air Force service pilots of World War II, they defied social conventions and the wishes of their mothers to break barriers. Well, these history-making women are flying again this week, and you're going to meet one.
(COMMERCIAL BREAK)
PHILLIPS: 1:30 Eastern time, right now. Here are some of the stories that we're working for you at this moment. Supporters and opponents trying to find some common ground if the bailout deal. A bipartisan group of senators and Congressmen meet today at the Capital, trying to come up with something. Treasury secretary Paulson won't be there.
PHILLIPS: And there's no deal, but there will be a debate. You could probably hear the city of Oxford exhale late this morning when John McCain's campaign said the candidate will be there. McCain said earlier that he wanted to postpone the debate if lawmakers couldn't hammer out a bailout deal. You can see the debate 9:00 Eastern, right here on CNN.
And the storm might not have a name, but it's got plenty of wind and rain. People from the Carolinas to Maine, should feel it in one way or another.
Well, the first presidential debate, it's now a go. Democratic nominee Barack Obama never wavered in his plans to appear at tonight's debate at the University of Mississippi. And now, John McCain is heading from Washington to Oxford, Mississippi, to meet Obama on stage. The Republican nominee had threatened to stay in Washington, to work on the financial bailout plan.
And joining me from Washington talk about it, CNN contributor, radio talk show host and Obama supporter, Roland Martin. And from San Diego, nationally syndicated columnist, Ruben Navarrette.
Great to have you both.
Roland what do you make of John McCain? He says he's in, he says he's out. It's like there's been all this drama. Do you think that it was all grandstanding? Was he really not going to show?
ROLAND MARTIN, CNN CONTRIBUTOR: Of course he was going to show. In fact, the Emmy Awards was Sunday. John McCain needs a special Emmy for dramatic performance this week.
I mean, the fact of the matter is, I mean, look. He woke up on Thursday morning and knew very well when he saw the ABC News "Washington Post" poll, Obama up nine points. And then the fact that Obama was at 52 percent, the first time he ever got over 50 percent. He said we have to change the ball game. Because his team knew if this continues, we keep getting hammered, we're going to be down 14, 15 points, we can't recover. Smart move on his part. But look, he played a game of chicken and he lost. Of course he was going to be in Mississippi.
PHILLIPS: Ruben, was he playing a game of chicken? I mean, he did take a hit in the polls. Did he try to do something astounding and then it backfired?
RUBEN NAVARRETTE, CNN.COM COMMENTATOR: I don't any it backfired at all, Kyra. I think McCain's going to come out the winner of all this in the long run. I grant you that when he said absolutely, I'm not going to Mississippi unless there's a deal. Then it turns out he goes to Mississippi (INAUDIBLE), a deal, that looks bad. Absolutely.
But think about Obama's reaction to all of this. Which is, he forgot that he had a day job. He forgot that he's also a U.S. senator. He was so intent, sort of fixated on his next job, he forgot to do the job he has now. And that's really, really important. There are a lot of people our there who are calling for leadership in this scandal, in this crisis, because we've been told in doom and gloom scenarios all week long, how horrible this is. Obama himself, recognizes how bad it is. But he didn't have time to go to Washington, to do his job?
PHILLIPS: But apparently --
MARTIN: But you know what --
PHILLIPS: But, apparently John McCain didn't even speak up in the meeting last night. It was --
MARTIN: Wait a minute. Not only did not speak up in the meeting, he admitted he didn't even read the plan. Not only that, he didn't even read the Republican plan that they offered. It's a little hard to say, I'm going to play John Wayne, when you don't even read the document at hand.
Now I agree that both senators should have been in Washington --
NAVARRETTE: Thank you.
MARTIN: But Ruben, when you say leadership, the problem here is, who is the leader? President Bush. His administration. Then you have congressional leaders, House and Democrats. These guys aren't even on the Senate Banking Committee. They're way down the totem pole.
NAVARRETTE: Roland, it's September 2008. George Bush is a lame duck president. Henry Paulson's not even the issue. He's going to be Treasury secretary for another four or five months. The new person that matters in this is either Obama or McCain. They're about to inherit this problem.
MARTIN: No.
NAVARRETTE: They both need to be fully engaged. Forget --
MARTIN: No, no. Ruben, you've got to have -- no, Paulson and Bush, are critical because they're the ones who are still sitting there. You can be lame duck, but you're still the president of the United States.
PHILLIPS: We're talking about the drama that has taking place and was it going to show for this, or not. And are they going to take on economy in ways that everybody wants to see them both take on the economy.
But what about the focus of this debate tonight? It was supposed to be on foreign policy. Seems like Sarah Palin's the only one right now getting hits for lack of foreign policy. Are these guys going to get back on track and talk about that tonight? Or do you think all of this is going to throw it off?
NAVARRETTE: I don't think they should talk about that, Kyra. I think this is absolutely now about the economy. It will look surreal for these folks to go down to Mississippi, and the talk about Baghdad and Kabul, when everyone wants to talk about Wall Street.
They need to come forward with an economic plan to say, listen, I understand the crisis. I have the will and the strength and the courage to solve it. And I'm prepared to roll up my sleeves and do it. I think Roland and I can agree on that. The last thing we want to hear from these folks tonight, is about foreign policy and national security.
(CROSSTALK)
PHILLIPS: And you know what? That's interesting because a new CNN Opinion Research Poll, I'm looking at it right now. Economy, number one on everybody's mind. Iraq is at 10 percent, economy 56 percent.
So, what do you think, Roland?
MARTIN: But, Kyra, here's how it's going to do down though, OK. Senator McCain does not want a pure economic conversation. And so what he is going to do -- they're still going to talk about national security. But the economic national security. People assume we are a superpower because of the military. But it's also because of money. So that's going to happen.
But also, foreign policy. This economic crisis affects U.S. homeowners. But also the global markets. The impact in Japan, in Germany, in England. So, you're still going to see that. And so you're Obama, you bring it back to issue number one. If you're McCain, you want to take it to foreign policy and leadership, but still try to mix and mingle what's happening on Wall Street, with those two important issues. You can't ignore it.
NAVARRETTE: I disagree.
PHILLIPS: Go ahead. Final thought, Ruben. Final thought.
NAVARRETTE: Kyra, I disagree. I think that Roland's assuming that the economy is a bad issue for McCain. Not so. McCain is coming out against a bailout, that according to your own stories on CNN, is very unpopular around America. So, a lot of Americans out there are looking for somebody to oppose the bailout.
MARTIN: Wait a minute! Obama is against the bailout without these particular conditions. Here's the deal, Ruben. You can say he's bad against it. The polls show: McCain's getting killed on the economy. So, he is not --
NAVARRETTE: Because he's a Republican, Roland. Come on, you get the game. He's a Republican. They're blaming Republicans.
MARTIN: But, also a deregulator. He can't avoid that.
NAVARRETTE: Roland, he's a leader. Check it out.
MARTIN: He's not a leader. He's a deregulator. He landed Deregulator. Way to go, Ruben.
PHILLIPS: Final thought, Ruben, and then we have to go.
NAVARRETTE: Yes. If saw leaders more often, Roland and I would be able to recognize them when they serve for you.
MARTIN: Oh, I know a leader! And I see a follower in John McCain.
PHILLIPS: Gentlemen, I'll tell you what we will be paying attention to. And I know they'll be talking about is Biden and Palin. And they'll be talking foreign policy no doubt, including the economy. That will be the next debate that we're talking about.
MARTIN: Oh, I can't wait to talk about looking at Russia, across the border.
NAVARRETTE: Let's do it again, then.
MARTIN: Can't wait!
PHILLIPS: Roland Martin --
MARTIN: Bring it, Ruben! Bring it.
NAVARRETTE: Let's go. Come on!
PHILLIPS: Ruben Navarrette. Thanks, guys.
Well, debate night in America. Not just here between Ruben and Roland. But we're going to be talking about the Obama/McCain face-off in Mississippi. That's just hours away now. You'll want to stay right here on CNN all evening for coverage from the best political team on television. And there's a lot more on the debate straight ahead here in the NEWSROOM and the "SITUATION ROOM" with Wolf Blitzer.
(BUSINESS HEADLINES)
PHILLIPS: Well, an eye-opening success with stem cells. A little girl once was blind, now she can see. We'll tell you about it.
(COMMERCIAL BREAK)
PHILLIPS: Companies around the world scrambling to check their food stocks as the tainted Chinese milk scare widens. Today the FDA issued an alert for American consumers on the recall of some coffee and tea products. All seven are sold under the name Mr. Brown. And the agency says it has been testing Chinese imports to the U.S. but hasn't found any melamine contamination yet. In China, the tainted milk is blamed for killing at least four babies and sickening more than 50,000 children.
She has always had to get by with four of the five senses. But a blind Missouri girl has seen amazing success from experimental stem cell treatment. She traveled half way around the world for them and with the help of family and community we bring you this story now from Bev Chapman of our affiliate, KMBC.
(BEGIN VIDEOTAPE)
UNIDENTIFIED FEMALE: Cowboy Chris. BEV CHAPMAN, KMBC REPORTER: This summer she showed us a thing or two.
UNIDENTIFIED FEMALE: Jo Dee Messina.
CHAPMAN: How to identify an artist through touch and smell.
UNIDENTIFIED FEMALE: That's Carrie Underwood.
CHAPMAN: An 8-year-old girl who had never seen the faces of the people who love her.
RAVANA WATRING, SAVANNAH'S GRANDMOTHER: I kept wondering if I'm doing the right thing, you know? This was -- being blind was her world and I kept thinking, what if I'm doing wrong by taking her world from her?
CHAPMAN: Reporter: She got her answer 13 times underway in a hospital in Xingdao (ph), China, where grandmother, dad and aunt took Savannah for seven stem cell infusions. This is the result.
UNIDENTIFIED FEMALE: What color's that?
UNIDENTIFIED FEMALE: Pink.
UNIDENTIFIED FEMALE: Very good!
CHAPMAN: Doctors said it would be three to six months before they would see any change, but after her fourth treatment, something amazing happened in an elevator.
WATRING: When Savannah was facing this mirror she said, hi. And Brent looked at me and I looked at Brent and -- actually I didn't know whether to laugh or cry.
CHAPMAN: The face she saw was her own.
UNIDENTIFIED FEMALE: Move your eye around, use that muscle.
UNIDENTIFIED FEMALE: Square.
UNIDENTIFIED FEMALE: It is a square.
CHAPMAN: Now she's learning shapes, numbers, letters.
UNIDENTIFIED FEMALE: H.
UNIDENTIFIED FEMALE: H for homework.
SHONNA MILLSAP, SAVANNAH'S AUNT: It's like one day she couldn't see anything and the next day she was seeing the letter E and which way the legs went.
UNIDENTIFIED FEMALE: What letter?
CHAPMAN: She doesn't always get it right -- UNIDENTIFIED FEMALE: This is F for fish.
CHAPMAN: -- but her family believes the improvement is nothing short of a miracle.
WATRING: I'm not one bit sorry. I'd do it all over again. In fact, you know, it may come to a plateau, in the 12 to 18 months, and we may have to take her back for more. And if need be, we will.
UNIDENTIFIED FEMALE: C -- cat.
UNIDENTIFIED FEMALE: It is a C. Good job. Good job.
(END VIDEOTAPE)
PHILLIPS: Well, Savannah's due to visit the eye doctor now to formally measure her new vision.
When their country needed them they answered the call to duty as no other women had done before. The women Air Force Service pilots, heroes in World War II, finally getting honored. We're going to talk to fly girl Bee Haydu right after the break.
(COMMERCIAL BREAK)
PHILLIPS: Well, it was a time when women were supposed to stay home and take care ever the kids, but it was also wartime. And while military men were on the front lines of World War II, expectations of women on the homefront changed as well. They were recruited to run factories, even recruited to fly military airplanes. They were called WASPs -- Women Air Force Service Pilots. And while these women broke new ground serving their country, some of the WASPs say they were stung by criticism at home. KTXA reporter, Seema Mathur, has their story.
(BEGIN VIDEOTAPE)
SEEMA MATHUR, KTXA REPORTER: B-25s, B-6s, the planes all familiar to the WASPs.
UNIDENTIFIED FEMALE: It's a sweet airplane.
MATHUR: They are some of the remaining 1,074 female pilots who flew for the U.S. military at the height of World War II.
BETTY JO REED, WWII PILOT: We did all kinds of things -- tow (ph) targets, instruct instruments.
MATHUR: 85-year-old Betty Jo Reed might need help getting in this plane today, but don't let that fool you. In 1943, she was an engineer test pilot. She knew the AT-10 inside and out.
UNIDENTIFIED MALE: Hang on to that one.
MATHUR: Once 87-year-old Jan Wood got settled, she was instructing the pilot up in the air. JAN WOOD, WWII PILOT: Give me a slow roll, and then give me a point roll.
MATHUR (on camera): Despite the WASPs' expertise on these planes the program was discontinued in 1944, and the women were never recognized as part of the Army Air Corps.
REED: And when I heard that, I -- I just was so hurt and so discouraged because the war was still on, but the men were coming back from Europe and they were complaining that women were flying their airplanes.
MATHUR (voice-over): The social stigma went beyond the military. Elaine Harmon's mom refused to talk to her.
ELAINE HARMON, WWII PILOT: People sort of felt like the reason they did it was not because so much that they wanted to help out with the war, it was because they wanted to follow the men around. And I think that my mother thought I was becoming a loose woman.
MATHUR: But humor aside, until changes in 1977, these women didn't even get military benefits.
UNIDENTIFIED MALE: They're going to fly by us as we're going out.
MATHUR: But this weekend is a reunion for the some 300 remaining WASPs.
REED: Those were our flight suits. And some of them were size 52, you know.
MATHUR: Where Betty Joe laughs about the hand-me-down mechanic's suits they wore and pilots with a special bond hug and reminisce knowing they have navigated to a special place in history.
Seema Mathur, TXA-21 News.
(END VIDEOTAPE)
PHILLIPS: Well, one of those barrier-breaking World War II pilots was 87-year-old Bee Haydu. She joins me live from Dallas.
Congratulations, Bee.
BERNICE "BEE" HAYDU, WORLD WAR II PILOT: Well thank you very much. It's a pleasure to be here.
PHILLIPS: Well it's such an honor to have you with us.
Tell me why did you decide to do this? What created the interest during the war for you?
HAYDU: Actually, it came about because I wanted to further my education. I signed up for night courses. At that time I was a secretary. And one of the courses was aviation. I decided well, I guess that aviation is really here to stay, so maybe I should look into this.
Actually, the program was preparing you for a private pilot's license. And that piqued my curiosity and I said, well, let's try flying, which I did. All of this happened in 1943. At that time is when I learned about Jacqueline Cochran's group, which were training programs for the WASPs, and that involved a seven-month training program in Sweetwater, Texas at Avenger field.
And so I signed up and I was very grateful to be one of the 25,000 who had applied for the program. And I was very grateful to be accepted.
PHILLIPS: Wow. And we're looking at your picture right now. As a matter of fact my director said you are one gorgeous fly girl, Bee.
HAYDU: Well, I didn't think so, but if he does, all right.
PHILLIPS: You'll take it. All right. Scotty, you've got a fan there.
So, tell me, what did your mom and dad say to you? This was a time where -- this was kind of an all-man's world, women just didn't do this.
HAYDU: I had a very progressive mother and father. And my brother was actually in Europe. He served there for over four years. And so they were really happy they was going to participate and be helpful in the war effort. So I was one of the fortunate ones that had a family who was behind me.
PHILLIPS: Wow. And what do you think your biggest obstacle was? Obviously you knew you were a good aviator, you made it through the program. But I know you went through a lot of tough times. What was the hardest part?
HAYDU: I would say going through the training was the hardest part. And you have to remember that, really, anyone can learn how to fly, but we had to learn to fly in the time that was allotted by the Air Force. And so -- I would say that that was the most difficult time because of the 1,000 -- 2,080 that were accepted in the program, only 1,784 graduated which was approximately 50 percent of the class.
So every time that you had to take a flight test, both a civilian flight test and an Army flight test, if you weren't learning at the speed they wanted you to, you could be dropped -- what they called washed out. So I would say that that was my most fearsome time.
PHILLIPS: Sure, and you obviously didn't get washed out.
What are you the most proud of? What's something you did as an aviator that you will just not forget?
HAYDU: Well I think I'm most proud of having won my wings. I don't know if you can see them or not, but they have a diamond in the center and it is not because diamonds are a girl's best friend, it is because that represents the Greek goddess Athena who was the goddess of war and crafts and so her shield is what is in the center of our wings.
PHILLIPS: Well, you are the goddess of the skies, that's for sure.
So did you do any squirrel cages, hammerhead stalls, any fancy moves yesterday, Bee?
HAYDU: Well, no, not yesterday, because we flew in in the B-25 and I don't think that they wanted to do that kind of thing.
PHILLIPS: All right. We will work on the F-18 next. How does that sound?
HAYDU: Oh, that -- the F-22, please.
PHILLIPS: OK. I'm going to put the request in for you, absolutely.
HAYDU: Thank you.
PHILLIPS: Bee Haydu, what an absolute honor and pleasure to talk to you and congratulations for your flight yesterday, and being honored. It's such an honor to talk to you.
HAYDU: Thank you very much. And I cannot thank everyone enough for finally recognizing that there were women who did fly military aircraft in World War II.
PHILLIPS: We salute you.
HAYDU: Thank you.
PHILLIPS: Let's take it now to Capitol Hill. Trying to figure out if indeed that bailout plan is going to happen once and for all. Jessica Yellin there on the Hill.
What do you think, Jessica? A lot of things happening by the second.
YELLIN: A lot of action on the Hill today, Kyra.
And I'm here with Congressman Roy Blunt, the No. 2 Republican in the House, the man designated to negotiate now on behalf of the House Republicans.
Congressman, thanks for joining us.
Let me ask you right away, a number of the House Republicans have made it clear they're fine if there is no deal by Monday. How committed are you to making a bailout deal by Monday?
BLUNT: I'd like a good deal by Monday. We don't have to have a bad deal. The Democrats can do what whatever they want to here. They're the majority of both houses of the Congress. If they want to take a bill to the floor and pass it they can. But I have reached out to Chairman Frank. We've talked to Democrats who are going to be in the room. My staff is working with them, saying we really want a bipartisan solution that has even better protection for the taxpayers and more free enterprise principles, better protection for homeowners that might be involved in this. And if we can walk out of that room with a bill that Republicans and Democrats will vote for, that's my goal. And I hope we can make that happen.
YELLIN: But if you can't -- because Secretary Paulson has already made it clear that some of those principles aren't ones he wants included in this package.
BLUNT: Well, if we can't -- Secretary Paulson and the Democrats can reach an agreement -- that's one they can reach without me being in the room at all.
I do think we need to be together on this, we need to work together on this. But that means more than just take it or leave it. We have already been down the take it or leave it road, and you know, until John McCain came back to Washington this week, the House Republicans were very much on this sort of leave it side of that. We were arguing for more options, more insurance, more loans, more tax payer protections, but everybody else seemed to be rushing to a deal. And frankly, John McCain came back and said, what a minute, I think the House Republicans have the taxpayers in mind here. And I'm with them.
YELLIN: So this proposal you'll be taking into the negotiating table today that includes insurance, that includes different taxpayer protections, is this John McCain's vision?
BLUNT: Yes, I think certainly it's a proposal that John McCain may very well be able to be supportive of. But clearly, he got the discussion going in the direction that we wanted to see it go all week. And we're going to do our best to work both with the administration and the Democrats. And by we, I mean me, the other leaders, who, while they aren't going to be in the room, are really standing there to be helpful on this.
Our staff, Spencer Bachus, our lead on financial services and his staff are all involved in a way that I think we can reach a conclusion here.
YELLIN: But let me just press you on this --
BLUNT: Yes.
YELLIN: It sounds to me that if you don't get certain elements included, that it is OK to have no deal; the House Republicans will walk away if certain elements are not included?
BLUNT: I think -- we're in for a real negotiation. If there is no real negotiation, there won't be a deal, and virtually all of my colleagues can go home and explain what was wrong in their mind with the deal that was being offered and how just a few additions here and there could have really made a big difference for taxpayers. And that is what we're going to try to achieve.
And I don't have any reason to believe that Chairman Frank, Chairman Dodd aren't coming to the room with a desire to negotiate rather than dictate. Dictation is not going to work here, negotiation just might.
YELLIN: And what would you like to see from Secretary Paulson?
BLUNT: I -- I think that he needs to be looking at all of the options and figuring out how he can do the best job for the economy with the realistic things, the tools that Congress is likely to give him, rather than just the one tool that he asked for early in the week.
And he has the right objective. He has the right background to do this. I think that we have talked about some other things that can be there, should be there, and I hope will be there.
YELLIN: You're saying you'd like to see him willing to be flexible?
BLUNT: Absolutely.
YELLIN: And finally, is there agreement within the conference at the very least that there is a financial crisis and that something needs to be done?
BLUNT: If there is not agreement, certainly the leader, John Boehner, believes there is a crisis. I believe there is a crisis. I think our leadership team do. And I believe almost all of our members do. And the American people, as the week moves on, are beginning to the hear a little more at their local bank, a little more about the local person trying to raise money to put in a business or expand their local franchise that cannot get the money to do it for the first time ever.
YELLIN: Congressman, thank you so much for your time.
BLUNT: You bet.
YELLIN: Thank you.
Kyra that is Minority Whip Roy Blunt from the Republican conference. Bottomline there, they want to see this bill, this package, changed in some ways, and they insist on having certain new provisions in it, otherwise, they are willing to push the time frame back a little bit further than the date we have been hearing. It might not get done by Monday. They want it done by Monday. But it might not -- Kyra.
PHILLIPS: Well you know we'll be talking about it all the way to that point. Jessica Yellin, thanks so much.
The next hour of CNN NEWSROOM starts right now.
