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Bailout Report Card; Big 3 Bailout Battle; U.S. Troop Deal; Pumping Alternative Energy
Aired November 18, 2008 - 12:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
TONY HARRIS, CNN ANCHOR: And hello again everyone. I'm Tony Harris.
And here are the headlines from CNN for this Tuesday, November 18th.
Bosses from the Big Three automakers on Capitol Hill soon. They will make the case for a taxpayer bailout.
The nation's financial crisis called the worst since the Great Depression. Are there comparisons to be made between FDR and Barack Obama? I will ask a historian right here in the NEWSROOM.
Six weeks into the $700 billion government bailout and the plan is changing. The Bush money team is on Capitol Hill with a report card for Congress.
Treasury Secretary Henry Paulson explaining his new bailout strategy. Instead of buying bad assets from financial institutions, the government will get new cash circulating by buying up bank stock. And he told a House committee he will hold half the bailout money for the Obama administration to spend.
(BEGIN VIDEO CLIP)
HENRY PAULSON, TREASURY SECRETARY: We assessed the potential use of remaining TARP funding against the backdrop of current economic and market conditions. It is clear that an effective mortgage asset purchase program would require a massive commitment of TARP funds.
In September, before economic conditions worsened, $700 billion in troubled asset purchases would have had a significant impact, but half of that sum in a worse economy simply isn't enough firepower. We have, therefore, determined that the prudent course at this time is to conserve the remaining funds available from the TARP, providing flexibility for this and the next administration.
(END VIDEO CLIP)
HARRIS: Congress is worried banks that get bailout money are sitting on it, or buying up rival banks, not lending.
Let's bring in Christine Romans at the business desk in New York.
Christine, isn't that exactly what the banks are doing, hoarding the money? CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: That's what they're being accused of doing. But you know, last week an executive from one of the banks told a House panel -- or Senate panel, rather -- said, you know, look, bad lending is what got us in this mess in the first place. Of course we are scrutinizing all of our new lending. We're lending billions -- hundreds of billions of dollars all the time, but, you know, we're not -- we're not going to just rush out and lend money willy-nilly.
And so that's the real risk here, is that we're trying to get the banks to lend money, but at the same time, they have to lend the money wisely. There have been a lot of accusations though that money is not doing what the Treasury intended. But the Treasury didn't attach any strings to it, Tony.
HARRIS: Love it.
ROMANS: We, the taxpayer, we are silent partners in this process. You know, we just bought the preferred shares, and now that's what the free market system is, right? So now the banks can do with it what they will.
HARRIS: I don't like the sound of that at all. I really don't. I had to think about it for a second and try -- no, I don't like to at all.
OK. So Secretary Paulson says he will hold half of the bailout money for the Obama administration to spend. It doesn't square when I also hear the language "crisis, crisis, crisis" everywhere, Christine.
ROMANS: He's got to ask Congress for the permission to do it. He could have gone back and asked Congress to spend the $350 billion that remains, but do you think this Congress was just going to let him do it?
HARRIS: That's a good point.
ROMANS: You know, he had to give them the notice and then Congress has, like, 15 days to say, no, you can't spend the money. He's got a little confrontational relationship going on right now, with especially the Democrats in Congress.
Congresswoman Maxine Waters, she said, look, I spent a lot of time selling your plan to my constituents who didn't want it and now they're saying, wait a second, how is this going to help me? And, oh, you changed course?
Another congressman said to him, you are flying a $700 billion plane by the seat of your pants. Aren't you?
HARRIS: Yes.
ROMANS: So, you know, there are some questioning from this Congress about how he spent the money so far. You mentioned he switched course after about six weeks in, and he's now injecting money directly in the banks. Here you can see our -- I'll show you the money pie. So $350 billion is going to be held for the next president to ask Congress to spend. He's injected all of this money, $33 billion yesterday to 21 banks, set aside some more for banks. All together, $250 billion for banks, $40 billion to AIG insurance company. We're told that was a one-off kind of use of the TARP funds for an insurance company -- it's not a bank.
And that means there's about $60 billion left over to spend. And that little blue corner of the world is what everyone is fighting for a piece of.
You know, some people would like to see it go directly to buy up bad mortgages, some people would like to see some kind of auto bailout. Some people would like to see it for more insurance companies.
So we'll have to see, but the Treasury secretary and the Fed chairman, they say that they're pleased. The bailout is working the way they wanted to stabilize the financial system, but there is more work to be done.
HARRIS: Well, let's -- and Christine, I guess we have a picture of this.
Do we have a picture of the hearing going on, on Capitol Hill? The House?
I've just been told that Secretary Paulson, Fed chief Bernanke, FDIC Chair Sheila Bair, they're done. Done with their testimony, but the hearing will continue today. So we'll see where this goes from here.
Christine, as always...
ROMANS: All right.
HARRIS: ... it's great to talk to you. Thank you.
ROMANS: All right. Bye-bye.
HARRIS: So Ford's top executive says his company is working hard to adapt to demands of the 21st century auto market. Alan Mulally says he will make that argument to Congress today when he asks for a taxpayer loan.
(BEGIN VIDEO CLIP)
ALAN MULALLY, CEO, FORD MOTOR CO.: The automobile industry is just absolutely essential to the United States' economy. We're in an economic situation now with the credit crisis and the financial and the banking issues that we really, more than ever, the automobile industry, needs to be part of the solution. And the only thing that we're asking for is to set up a bridge loan mechanism that, if the economy continues to deteriorate in the near term, that we could access that so we can continue to invest in the products that people really do want, and value, and help be part of this economic recovery.
(END VIDEO CLIP)
HARRIS: Ford announced today it is selling off 20 percent of its stake in Mazda. That should raise $540 million of much-needed cash.
Ford's CEO will be joined by his counterparts from GM and Chrysler on Capitol Hill in about three hours. They want Congress to cut them a piece of the $700 billion bailout pie. A $25 billion loan, to be exact.
Secretary Paulson was asked about that this morning during his congressional appearance.
(BEGIN VIDEO CLIP)
REP. PAUL KANJORSKI (D), PENNSYLVANIA: Do you consider the loss of the American auto industry as significant and systemic risk, or don't you? If we lose three million jobs, what would it cost to make it up? What would be the loss of revenue? And would it be worth spending $25 billion initially to stop that from occurring?
PAULSON: I believe that any solution would be a solution that leads to long-term viability, sustainable viability here. And so, again, I don't see this as the purpose of the TARP. Congress passed legislation that dealt with the financial system's stability. And again, you know, there are other ways, and, you know, you also appropriated money for the auto industry and the Department of Energy bill, you know, 136, and you want another alternative, maybe, to modify that.
(END VIDEO CLIP)
HARRIS: So what caused Detroit to go into a skid? We asked our Brooke Baldwin to look into that.
(BEGIN VIDEOTAPE)
BROOKE BALDWIN, CNN CORRESPONDENT (voice-over): With Detroit's Big Three begging for a bailout, many wonder how the American auto industry drove itself into a ditch this deep. Executives blame the credit crisis.
UNIDENTIFIED MALE: And so what's happened is that we have what is clearly a crisis period in the economy.
BALDWIN: There's no denying the U.S. economy is reeling, but that is not the only problem. Just ask any of these Detroit area autoworkers, like Mike Haddock (ph).
UNIDENTIFIED MALE: It's tough around here.
BALDWIN: This 24-year General Motors employee is nervous. Haddock (ph) sits at the bar just down the road from a GM transition plant, watching for news out of Washington. He says it's the CEOs who put the car companies in this precarious position. UNIDENTIFIED MALE: They're the ones that make the choices. We just put the cars together.
BALDWIN: Or Jerry Reedy (ph), whose wife is worried about her job at GM.
UNIDENTIFIED MALE: She looks over her shoulder every day. OK?
BALDWIN: He says the company should get rid of the long-term perks enjoyed by higher-tiered supervisory employees.
UNIDENTIFIED MALE: She's a level 7. The level 8s get the free car washes, the free cars, the free gas, the free insurance, and they complain yet. I mean, you want to save some money? Let's save some money.
BALDWIN: Members of Congress are also playing the blame game, citing the company's track record on car quality and fuel efficiency, and lucrative union contracts for a dwindling workforce.
DAVID COLE, CHAIRMAN, CENTER FOR AUTOMOTIVE RESEARCH: If I were outside of the city and didn't understand it, I'm sure I would be pointing fingers too.
BALDWIN: But David Cole, chairman of the nonprofit Center for Automotive Research, contends health insurance costs are strangling these companies.
COLE: Every competitor, international competitor, comes from an economy with some form of nationalized health care. And that means in their home countries, the companies that produce cards really pool that cost across the entire economy. Here, that's all absorbed within the company. So that is a critical factor.
(END VIDEOTAPE)
HARRIS: CNN's Brooke Baldwin reporting.
What role could Senator John McCain play as the Obama administration takes office? We will find out what the former rivals have been talking about. That's next.
(COMMERCIAL BREAK)
HARRIS: Defending Iraq's security plan with the United States, Prime Minister Nuri al-Maliki goes public with reservations and reassurances after his cabinet signed off on the three-year withdrawal timeline.
Live now to our Arwa Damon. She is in Baghdad.
Arwa, great to see you.
What is Prime Minister Nuri al-Maliki actually saying here?
ARWA DAMON, CNN CORRESPONDENT: Well, Tony what he's trying to do, really, is to garner the faith and backing of the local population here. Remember, that agreement, as you did just mention, does still have to pass through parliament, and it could prove to be incredibly difficult.
There are many reservations out there about the agreement. And also, given that this is Iraq, there are all sorts of rumors that have been floating around about secret articles that might have been included that would perhaps lead to a permanent U.S. presence.
So the prime minister coming out today, addressing the people, and also addressing those critics and those opponents to the agreement, reassuring Iraqis that if this agreement does pass, it means there will be no more U.S. Military raids on their homes unless the Iraqi government approves it. It means that the U.S. Military will not have the ability to detain Iraqis without an arrest warrant, and when they are detained, they will be handed over to the Iraqi authorities within 24 hours.
He also referred to those timelines, those dates, June 30, 2009, that would see a withdrawal of all U.S. combat troops from populated areas. And then that date of 2011 that would see all U.S. troops out of the country. He said that the negotiations were very tough, saying that he did have some reservations about the agreement, but that "It was a solid prelude to regaining Iraq's full sovereignty within the next three years."
Parliament yesterday had a draft of the agreement read in it. There was much debate, much chaos. According to one lawmaker, there was such an uproar, with people shouting, banging on tables, opponents trying to create a lot of ruckus, that one lawmaker said he couldn't actually hear the draft being read out.
So that very critical at this point in time. Is parliament going to pass it? Remember, they do take a two-week recess on the 25th, and that clock is ticking with the U.N. mandate expiring at the end of December.
HARRIS: And Arwa, quickly, the Iraqi parliament today has decided to hold the country's provincial elections on January 31st. As I recall, they were scheduled for October.
What is the significance of those elections, and what impact might they have on U.S. troops stationed there?
DAMON: Actually, Tony, it was cabinet that passed that. Parliament still has yet to pass it, to see provincial elections happening on January 31st. But this is very critical and actually very significant.
If you remember back to the first round of parliamentary elections, that was back in January of 2005. And remember, Iraq's Sunni population back then boycotted the election. So, for the Sunnis, it's very critical. They will be out, they will be voting, and they will be trying to establish themselves within the provincial council, but it's also a time that is going to be very tense. Not just Sunni versus Shia tensions, but there are increasing tensions within the Sunni and Shia communities.
U.S. troops will still be patrolling the streets of Iraq at that point in time. And it will be up to them and their Iraqi counterparts to try to prevent that tension from becoming violence.
HARRIS: Arwa Damon for us live in Baghdad.
Arwa, appreciate it. Thank you.
Reaching out to former rivals, President-elect Barack Obama putting the bitter election battle with John McCain in the past. He is also considers another former opponent as part of his future administration.
CNN's Ed Henry live for us from Chicago.
And Ed, let's start with the meeting between Obama and McCain. What are your sources telling you about that closed-door meeting?
ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, Tony, they're saying that it went much beyond what they officially put out in their written statement yesterday, which was about how they wanted to talk about ethics reform and things like that. They also talked about some thorny issue, like immigration reform, for example, something that split the Republican Party and was a very difficult issue for John McCain in the last presidential campaign, obviously.
But also, they talked about Guantanamo Bay, Cuba, the military prison there, and whether or not they can sort of try to find some way to figure out how to shut it down. And that's been a very difficult issue to sort out.
And so what I think that points to is the idea that these two men think that while they disagree on a lot of things, there also are a handful of issues where they're largely in agreement. And they think that perhaps in January and beyond, they can come together on some of these things and shake loose these sort of stalled issues on Capitol Hill.
But they're not going to have enough of a partnership for a McCain cabinet post. But instead, I think, with McCain in the Senate, and Barack Obama eventually making it into the White House, they're going it try to pick off a handful of issues to work together. But I bet John McCain will also be the loyal opposition on a lot of other issues -- Tony.
HARRIS: And Ed, what are you hearing about the possibility -- the hype machine is really churning on this -- of Hillary Clinton joining the Obama cabinet?
HENRY: I just talked to a senior Democrat who said in the foreign policy world, a lot of Democrats are operating under the premise that Hillary Clinton is going to be the eventual nominee to be secretary of state. She has not yet been offered the job by the president-elect, but all the signs are pointing in that direction. The people who are sort of reading the tea leaves in the Democratic Party say when you look at the fact that now we've been told by two Obama transition officials that they're starting to pore through the finances and some of the post-presidential activities of Bill Clinton, that that suggests that she is a very serious contender for this post. The fact that the Obama officials are basically going through his charitable foundation, his presidential library, trying to figure out who contributed to it, to get an idea as to whether there might be some potential conflicts of interest.
These senior Democrats do not think the Obama team would go through this many hoops and then in the end not give the job to Hillary Clinton. So they think it's going to take something major in this disclosure to prevent her from doing the job -- Tony.
HARRIS: Yes, it seems to be the case.
All right. Ed Henry in Chicago for us.
Ed, thank you.
And word just in just a short time ago Connecticut Senator Joe Lieberman will keep his chairmanship of the Homeland Security and Governmental Affairs Committee. The decision had been in question after Lieberman's support of John McCain in the presidential election. Lieberman thanked the Democratic leadership and the new president- elect.
(BEGIN VIDEO CLIP)
SEN. JOSEPH LIEBERMAN (I), CONNECTICUT: This is the beginning of a new chapter, and I know that my colleagues in the Senate Democratic Caucus were moved not only by the kind words that Senator Reid said about my longtime record, but by the appeal from President-elect Obama himself that the nation now unite to confront our very serious problems.
(END VIDEO CLIP)
HARRIS: You know, the comparisons were inevitable. Many say Barack Obama is coming into office under similar conditions to those faced by FDR in the 1930s. Here is the latest cover of "TIME" magazine.
FDR faced the Great Depression. Obama, a recession. Fascism was threatening when FDR became president. Today it's terrorism.
Joining me now is David Woolner, executive director of the Roosevelt Institute and co-author of the book "FDR's World: War, Peace, and Legacies."
David, thanks for being here. We appreciate your time.
DAVID WOOLNER, EXECUTIVE DIRECTOR, ROOSEVELT INSTITUTE: Thank you. HARRIS: Why don't we do this, David? Why don't we listen to the president-elect on "60 Minutes" together? And then I've got a question for you.
WOOLNER: OK.
(BEGIN VIDEO CLIP)
BARACK OBAMA (D), PRESIDENT-ELECT: What you see in FDR that I hope my team can emulate is not always getting it right, but projecting a sense of confidence and a willingness to try things and experiment in order to get people working again.
(END VIDEO CLIP)
HARRIS: And David, I guess here's the question -- why is Barack Obama looking to FDR as something of a model. And to the extent that he is actually doing that, is he smart to do so?
WOOLNER: Well, the quote is interesting. It stems from a 1932 election comment that President Roosevelt made when he said that the country demands bold, persistent experimentation. And you can't sit and do nothing, and you must try something, and the country demanded it.
And we are seeing a lot of parallels between the crisis we face today and the crisis in 1932. We tend to forget, though, that the Great Depression was actually part of a worldwide economic crisis.
HARRIS: Yes.
WOOLNER: It did lead, as you said, to the rise of fascism in Europe, and in other parts of the world. And in many ways, democracy, as a consequence, was under siege worldwide. And so one could make the argument that what Roosevelt really did in the New Deal was to save democracy and to save liberal capitalism.
HARRIS: That's interesting.
David, with the FDR model as a bit of a case study here, how much time really does the president-elect have to impact, to get some results, particularly with the economy?
WOOLNER: Well, you know, he's going have to move, and move quickly. I think he's not going to have the luxury of waiting too long. Even in this period before the inauguration, I think the signals he's been sending that he's thinking through what he's going to be doing are signals that are needed right now.
He's going have to reach out to the American people as well as soon as he hits office. You know, Roosevelt did it through the Fireside Chats. I suspect President-elect Obama will do it through YouTube.
HARRIS: That's interesting. WOOLNER: But, you know, he is going to need to move, and he's going to need to move quickly. But most importantly, I think what he's going to have to do, much like FDR did, is to try to restore the confidence of the American people in their government, and in the government to meet these great crises that we're confronting, and that's really what FDR did. He restored the hope of the nation.
HARRIS: And David, how much more difficult is this job for the president-elect given the fact that we are currently fighting two wars?
WOOLNER: Well, this is one of the differences, I would say, between the situation that was faced by President-elect Obama today and President Roosevelt in 1932. In a way, President Roosevelt, because the mood of the country, was really against getting involved too directly overseas in some of the threats that we're facing, the United States. President Roosevelt could, in a way, put that on the back burner for the first couple of years or so of his first administration.
I think Barack Obama's not going to have the same luxury. He's going to have to deal with this crisis right way. Both the global economic crisis and the international crisis, security threats, that we face around the world.
I think the two can be linked. If he does a good job working with our allies, working with our partners around the world in solving that economic crisis, I think that will go a long way towards helping us work together with our friend and allies to confront the security threats that we face today.
HARRIS: David Woolner is the executive director of the Roosevelt Institute.
David, thanks for your time. We appreciate it.
WOOLNER: Thank you.
HARRIS: Winter is hitting early and hitting hard in some parts of the country. We will get the latest from the severe weather center in just a moment.
(COMMERCIAL BREAK)
HARRIS: Well, we need to show you these pictures. Southern California just severely scarred, ruins left by three ferocious wildfires. Almost 1,000 homes and apartments burned to the ground.
Man, look at these pictures. Forty-two thousand acres scorched.
Today, hundreds of residents of a burned-out mobile home park in Los Angeles will be allowed in to see the devastation for themselves. Fire officials say the biggest of the blaze, the Freeway Complex Fire, is now 75 percent contained.
The other extreme, on the other side of country, check out western New York State.
(WEATHER REPORT)
HARRIS: Chad, thank you.
CHAD MYERS, CNN METEOROLOGIST: The good old days!
HARRIS: The good old days!
MYERS: Talk to you soon.
HARRIS: All right. Still to come, what do you think? Wouldn't it be better for U.S. automakers to reorganize under bankruptcy rules rather than getting a bailout? Think about it. We're back in a moment.
(COMMERCIAL BREAK)
HARRIS: We are about three hours into -- just past three hours into the trading day, as you can see. But kind of a mixed day on Wall Street right now as you can see. The Dow was up 83 points, but the Nasdaq, the tech heavy Nasdaq, is down four. So kind of a mixed day so far. We'll get a market check with Susan Lisovicz in just a couple of minutes.
Auto industry execs making their case today for help from you and me, the taxpayers. They're asking for billions of dollars to keep their companies from going under. But some critics say bankruptcy may actually benefit the industry.
CNN's Bill Tucker explains.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT, (voice over): A video posted on YouTube by General Motors lays out what could happen if GM, Ford and Chrysler no longer existed. Using a report from the Center for Auto Research, the scenario is grim and extreme. Critics of the auto industry say that bankruptcy would not mean the end of Detroit, but it would mean the end of Detroit as we know it. And that, they say, would ultimately be a good thing.
UNIDENTIFIED MALE: They will either reemerge with a company strengthened, with stronger balance sheets and lower labor costs, or they'll emerge as reorganized companies with new ownership, new management and they'll go forward.
TUCKER: Others are worried that if a carmaker files for bankruptcy under chapter 11, no one would buy its cars. And that would spell the end of the company. But lawyers point out, warranties would not be void.
PROF. PETER MORICI, UNIVERSITY OF MARYLAND: Well if the company, when it goes into bankruptcy, first of all, it's going into reorganization. It's not going out of business. TUCKER: Some argue that's where the government could play an appropriate role providing some sort of absolute guarantee of vehicle warranties. Supporters of the bankruptcy option admit it's not pleasant, but sometimes it's necessary.
JACK WILLIAMS, AMERICAN BANKRUPTCY INSTITUTE: Bankruptcy, because of its transparency, and its oversight, as a system, requires that management justify itself and requires that management justify its position and ultimately that management justify it's business plan.
TUCKER: Ironically, that type of scrutiny generally doesn't exist outside of the bankruptcy process. And the one thing, both opponents and proponents of the bailout agree on, bad management has brought the auto industry to this point.
(END VIDEOTAPE)
HARRIS: All right. One issue needing some clarification here. It cuts to this question -- will the government's bailout money go to rescue bad mortgages, since the mortgage meltdown was at the heart of the financial crisis? Here's Treasury Secretary Henry Paulson's answer at today's House hearing.
(BEGIN VIDEO CLIP)
PAULSON: Let me just say specifically to you, congresswoman, that I have not said no to doing something here in the TARP aimed at foreclosure mitigation. We did not buy illiquid assets for a very good reason. We are going to continue to evaluate and look for programs that protect the taxpayer and are effective.
And I just would make one last point here. In designing programs, it's -- broad-based programs, there's a balance to getting money to those who need it, as opposed to those who don't need it.
(END VIDEO CLIP)
HARRIS: Paulson says he will hold half the bailout money for the Obama administration. Barack Obama already has a point man dealing directly with the Treasury.
Our Brian Todd reports.
(BEGIN VIDEOTAPE)
BRIAN TODD, CNN CORRESPONDENT, (voice over): Three days after being voted into office, Barack Obama was up front about his top priority.
OBAMA: Immediately after I become president, I'm going confront this economic crisis head-on.
TODD: But it doesn't appear Mr. Obama's waiting until January 20th. In speaking with CBS's "60 Minutes" about the immediate need to help homeowners, the president-elect is asked if he's consulted with Treasury Secretary Henry Paulson, the architect of the financial bailout.
OBAMA: We've assigned somebody on my transition team who interacts with him on a daily basis. And, you know, we are getting the information that's required. And we're making suggestions in some circumstances about how we think they might approach some of these problems.
TODD: An Obama transition official tells us that last part is an overstatement.
The liaison with Paulson, this official says, has a constant line of communication with the Treasury secretary, but is not giving policy advice.
Who is this person? Dan Tarullo, former economic adviser to President Clinton. Former member of the National Security Council. Our efforts to reach Tarullo were unsuccessful and the Obama team says he's not doing interviews.
But in a signal of how serious the economic crisis is, an Obama aide says Tarullo's their only high-level adviser now in direct contact with a cabinet secretary. A different arrangement from a standard procedure they have at the State Department, Pentagon and elsewhere with lower-level agency review teams.
MORICI: It's a good idea to send one individual to interact with Secretary Paulson to ensure that policy has a smooth transition over the next 60 days so that there isn't a disruption in the way the economy is managed.
TODD: One historian says this is unusual but appropriate. He says other top priorities, like Iraq, can wait until Mr. Obama takes office in January. But with the bailout, he says, so many decisions are being made almost hour by hour that Obama needs to be privy to what's going on at all times.
Brian Todd, CNN, Washington.
(END VIDEOTAPE)
HARRIS: California Governor Arnold Schwarzenegger has some ambitious ideas for getting us out of our energy fix. Would they really work?
(COMMERCIAL BREAK)
HARRIS: Governor Arnold Schwarzenegger is pumping up his state's alternative energy plan. A bold, new proposal would require the state to use more alternative energy than any other state. CNNMoney.com's Poppy Harlow has our "Energy Fix" from New York.
I like the sound of it. How's the sales pitch going, Poppy?
POPPY HARLOW, CNNMONEY.COM: You know, it just came out this morning. So he has a lot of lawmakers to convince. But Governor Schwarzenegger, if he has his way, his state, California, will get a third of its energy from renewable sources by the year 2020. This morning, he kicked off a two-day climate change summit with the boldest, renewable standard proposal to date.
Now California has already committed to getting 20 percent of its energy from renewables by 2010. That's not very far away. This proposal, of course, still needs approval from the state legislature.
But if you look across the country, 24 states, take a look that map there, including the District of Columbia, have mandatory renewable standards. Four others have non-binding goals. Missouri voters, just a few weeks ago, approved another plan for alternative energy sources. That came on Election Day. And if you look there at some of the bolder measures in New York, where I am. By 2013 they want 24 percent of their energy from renewables. In Oregon, the goal is 25 percent by the year 2025.
Still, though, Tony, nowhere near that 33 percent goal set by Schwarzenegger this morning.
HARRIS: Boy, as you look at that map, it really looks like this is the wave of the future.
HARLOW: Yes.
HARRIS: But I'm assuming here it is more expensive to get alternative energy. So who pays, Poppy?
HARLOW: That's a great assumption. It's a great question. Governor Schwarzenegger says he's going to raise utilities rates, except for on low-income families. That will help pay for some. And he thinks overall this is going to benefit the state through a lot of job creation. Of course, those environmental benefits as well. Some people say, the critics say though, hey, this is a risky bet, especially during an economic crisis like what we have going on right now. California already faces a whopping $28 billion deficit through June of 2010. California, though, says, hey, we're trying to be a world climate leader.
The world, though, may have a problem with the price tag. What we're going to see next month at the U.N. Climate Change Committee meeting in Poland, they're going to talk about the extension of the Kyoto Treaty. You can bet they're going to discuss whether world economies can afford to use anything but the cheapest sources of energy right now. The treaty, interestingly enough, does not include the United States and China, the two largest emitters of greenhouse gases in the world. California, though, it looks like it's trying to change that -- Tony.
HARRIS: OK, Poppy, appreciate it. Thank you. See you tomorrow.
HARLOW: You're welcome.
HARRIS: Some of you have been contacting us through our FaceBook page about the fires in California. What's on your mind, next.
(COMMERCIAL BREAK) HARRIS: Smoky skies over southern California finally clearing now. Five days into a disaster caused by three huge wildfires. Hundreds of residents of a burned out mobile home park in Los Angeles will be allowed in to see the devastation for themselves today. Many will find nothing but ash where their homes once stood. The fires destroyed almost 1,000 homes and apartments and scorched 42,000 acres. Fire officials say the biggest of the blaze, the Freeway Complex Fire, is now 75 percent contained.
Veronica De La Cruz has been keeping an eye on the fires and the web and she joins us now with what she's been finding.
Hey, Veronica, I also understand you've been monitoring the discussion on this show's Facebook page, huh?
VERONICA DE LA CRUZ, CNN CORRESPONDENT: Yes. Yes. That's right, Tony.
Meagan Ranger, she's a member of the group, she posted her family's story, along with some pictures. And I wanted to go ahead and share this with you, Tony. She writes, "this weekend, my 90-year- old grandmother, along with almost 500 other families, lost their homes in the Sayer fire in Sylmar, California. It is such a surreal thing to be a victim. You always sympathize with families who have lost everything in fires, but when it's your family, it seems unreal."
And then, Tony, she goes on to say, "my grandmother has fire insurance. That's great. Really we've only lost stuff. The future for her is up in the air. There are going to be some tough times ahead as far as her living situation is concerned. I went to visit what was left of her neighborhood Saturday morning to see for myself. It was a horrific sight. Like a bomb hit. I saw firsthand what a war zone looks like. Firefighters did fight to the bitter end to save the homes in my grandmother's community and I want to thank them for their hard work and determination. They are the reason that so many people were able to get out safely."
Tony, I want to show you some pictures that Meagan posted to the group. This is one that she says she shot herself. She says that her grandmother's home used to stand about three houses . . .
HARRIS: There's nothing there, Veronica.
DE LA CRUZ: Yes, three houses from where she's standing. And as you can see, like you just said, there's nothing left. Nothing left. She also posted this one. Take a look at this. This is another photo that was taken by a photographer for the "Los Angeles Times." She says that based on the location, that would be her grandmother's car right there and then her home would have been to the right of that. So, like you said, absolutely nothing left. It's really, really -- it's devastating.
So we do want to thank Meagan and her family for sharing their story. If you have one as well, please log on to our Facebook group. Just search Veronica De La Cruz in the CNN NEWSROOM with Tony Harris.
HARRIS: Veronica, appreciate it. Thank you.
HARRIS: His finances, her future. Hillary Clinton a candidate for secretary of state in the Obama administration. But could Bill Clinton's global connections and financial dealings be a stumbling block?
CNN's Tom Foreman examines the potential conflicts.
(BEGIN VIDEOTAPE)
WILLIAM JEFFERSON CLINTON, FORMER PRESIDENT OF THE UNITED STATES: It's great to see you. How are you?
TOM FOREMAN, CNN CORRESPONDENT, (voice over): Bill Clinton's charitable foundation has waged a widely praised global battle against AIDS, malaria and climate change, for economic and educational development, and it has raised a lot of money. $81 million in contributions last year alone. Some from foreign interests. And that could be a problem. If Hillary Clinton becomes secretary of state, some political analysts say Bill Clinton's connections could pose a conflict of interests. It's not just a theory.
SEN. HILLARY CLINTON, (D) NEW YORK: I believe that the president should not attend the opening ceremonies because that is giving a seal of approval by our United States government.
FOREMAN: Back in the spring, before the Olympics, while she was speaking out against China's crackdown on Tibetan protesters, the "Los Angeles Times" reported that her husband's foundation was taking money from a firm accused of collaborating in that censorship. In addition, politico.com and others cite donations from officials in Saudi Arabia, Morocco, the United Arab Emirates and Kuwait. Each one a contact for Bill Clinton and a potential conflict for the Obama White House.
JEANNE CUMMINGS, POLITICO.COM: I think that he knows a lot of world leaders and he has informal conversations with those world leaders. And those would be conversations that the administration will not be able to track, nor can they control.
FOREMAN: Of course, all those Clinton connections could also buy enormous goodwill for Obama and provide him with a wealth of international experience. Besides, the former president recently told philanthropy.com, he guards against any conflict between a donor's intentions and his wife's job as a senator.
W. CLINTON: If there's even any kind of question, we try to do exhaustive vetting. I can recall some money we haven't taken, and also some we did, but only after more than a year of efforts to make sure that everything was OK there.
FOREMAN: Still, the Clinton Foundation has never named all of its donors. And while many charities guard the identity of their benefactors, not many are so close to being hard wired to the White House.
Neither the Clintons, nor Obama, are talking publicly about all they could gain or lose in this. But privately, it looks like Bill Clinton is, once again, casting a long shadow.
Tom Foreman, CNN, Washington.
(END VIDEOTAPE)
HARRIS: Kyra's working on a doodle here because doodles are dandy. Sorry. And valuable, if they're made by the right person. That was -- oh, man.
(COMMERCIAL BREAK)
HARRIS: Yes, one person's scribble is another's prized artwork. Is this going to be good? OK. Especially when it comes to the doodles of President-elect Barack Obama or Governor Sarah Palin . . .
KYRA PHILLIPS, CNN ANCHOR: Or Kyra Phillips.
HARRIS: Or Kyra Phillips. Here's CNN's Jeanne Moos.
(BEGIN VIDEOTAPE)
JEANNE MOOS, CNN CORRESPONDENT, (voice over): A lot of people can say . . .
UNIDENTIFIED FEMALE: I got his autograph.
MOOS: But this guy can say, I've got Obama's doodle. And he's not selling.
WAYNE BERZON, OWNER, OBAMA'S DOODLE: And they said, well what if the offer was six figures?
MOOS: Nope. Financial consultant Wayne Berzon's not selling the doodle he bought for about $2,000 at a charity auction a near and a half ago.
There's Senator Feinstein, Senator Kennedy, Senator Harry Reid, and this is Senator Chuck Schumer, only it doesn't look like him.
Compare this to another famous doodle that made the rounds recently.
Here's Sarah Palin's.
"The New Republic" uncovered it in a box of odds and ends kept by the woman who ran Palin's campaign for mayor of Wasilla, Alaska.
SHEILA KURTZ, GRAPHOLOGY CONSULTING GROUP: She was fantasizing about her win. It's me. Check this box.
MOOS: Palin jotted down possible slogans like "time for a change," telling citizens, "you would be my boss."
UNIDENTIFIED FEMALE: It looks confused and talky.
MOOS: Talky? UNIDENTIFIED FEMALE: Uh-huh.
MOOS: What's talky?
UNIDENTIFIED FEMALE: Like she's talking too much.
MOOS: As for opinion on President-elect Obama's doodle?
UNIDENTIFIED MALE: The guy is intelligent.
UNIDENTIFIED MALE: This actually looks done well. Except for the hair. I don't like the hair.
MOOS: What's wrong? Not yellow enough? We had graphologist Sheila Kurtz put the two sets of doodles under her magnifying glass.
KURTZ: He is economical and clear and to the point.
MOOS: Ronald Reagan used to like to doodle faces. The book "Presidential Doodles" features LBJ's devil cap, FDR's fish and JFK's sailboats. As for Sarah Palin's doodles from back before she was famous, our graphologist notes the circled dot over the I, the hook on the P and the words scrolled over words . . .
KURTZ: She's smart, but she's very scattered and all over the place and wants everyone to recognize her and to know who she it. It's almost like a teenager's writing.
MOOS: Yes, well tell that to the guy who wanted his cell phone signed. The collector who bought the Obama doodle is putting it in a safe-deposit box for now.
BERZON: It's kind of a neat idea that -- to own something that could end up in a presidential museum.
MOOS: In a museum? Or on some blog? Makes you wants to hide your doodles, lest they be criticized.
UNIDENTIFIED MALE: Really. Like somebody who was in prison would write on like their wall.
MOOS: Or someone posted after eying Sarah Palin's doodles, I think the O in mayor just winked at me.
Jeanne Moos, CNN, New York.
(END VIDEOTAPE)
HARRIS: You know, your team has real issues. Here you are doing this wonderful doodle ...
PHILLIPS: That is right.
HARRIS: Isn't that something? And they want to turn this into a catcher's mitt or something a little more --
PHILLIPS: That's 'I love you' in sign language --
HARRIS: Yes.
PHILLIPS: -- but backwards.
HARRIS: Yes, and your team was dropped on its collective head as children. They weren't loved enough, and they turned that into something -- something not I love you.
PHILLIPS: I will not stick to art, I promise.
HARRIS: Yes. Have a great show.
Can I have this?
PHILLIPS: Yes, you can keep it. I love you.
