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Obama and Biden Listen to Governors' Concerns; Ford Asks for Bridge Loan, CEO to Take $1 Salary; Arrest Made in Connection to Murder of Jennifer Hudson's Relatives
Aired December 02, 2008 - 10:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
T.J. HOLMES, CNN ANCHOR: Well we are riding the roller coaster on Wall Street. The heavy weights in the back car. The recession, will it drag down investment (ph) again, or can they climb back up?
Plus, live this hour, Barack Obama addressing the nation's governors. What they'd want to hear from the president-elect.
Hello to you all. It is Tuesday, December 2. I'm T.J. Holmes sitting in today for Heidi Collins, and you are in the CNN NEWSROOOM.
All right, Wall Street -- it has been about 30 minutes since that opening bell rang. Do you know where your money is? Where it's headed? Live look now at the big board. There you are 25 points up. Again, it is just the first half hour. We saw a 680-plus point drop yesterday. This is a welcome sight even though we're just half an hour into this trading day.
Christine Romans part of the CNN Money Team joins us now from New York.
What do we going to see today? What do we anticipate seeing today?
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Well, another roller coaster who knows? You know the Dow up 21 points here today. What we can tell you is it's been a pretty tough going. And I keep saying this, T.J., this is the new normal, these big swings. Yesterday an eight percent swing for the S&P 500. And this has been a really rough year, quite frankly. You've got the stock market trying to figure out just how bad the economy is and when it's going to come out of it.
We got official news of a recession yesterday. We got a whole raft of negative economic news. And we're heading into the all important shopping season, two thirds of economic activity is shopping. So there's a lot to be frankly nervous about. The thing that I keep focusing on is the longer term. And we know for the longer term we're told again and again that it is good to invest in the stock market. Well now, over the past 10 years people are seeing in fact negative returns, pretty deeply negative returns.
That is really, really rare. Not since 1974 and the Great Depression have you been able to go back 10 years and see big declines for the S&P 500. Over the last year down about 45 percent. Think of that. The S&P 500 is a broad index, 500 different stocks from all different kinds of industries. It's over five years down 24 percent, down 31 percent over 10 years. What that means is you have been investing into the stock market and you have been seeing those investments actually decline.
If you're close to retirement, it means you might have to work a little longer. If you're saving for college, it might mean, as many people are, you have to save another whole year of college based on these losses we've had if you've invested in the stock market through a 529 or a market-based plan. It means a lot of different things for a lot of different people. But if you have exposure to the stock market, it has been pretty ugly.
This is not to talk about the job situation or the foreclosure situation as well. So a lot of different things happening here. And it's just really important for people to be aware of just how deep this goes and I think when you look at those stock market numbers, T.J., that's what you're seeing. You're seeing people over the past 10 years. Think of a whole generation of workers who have only been investing for about 10 or 11 years. And people in their 30s, for those people in their 30s, they're seeing all of those gains wiped away, and in some cases you're just holding on to maybe a company match if you can.
HOLMES: Yes. Some of those folks have some more time to be working.
ROMANS: That's right. They do have more time.
HOLMES: More time. All right. Christine, those numbers enough for anybody to get choked up on. Take care of that throat of yours. All right. Thank you so much.
Well, the man who has been at the center of the financial crisis, Henry Paulson, he's the government's -- in charge of the government's efforts to stop the bleeding. Next hour expect to see Treasury Secretary Henry Paulson turning his attention to the global picture. He'll discuss U.S. relations with China at the World Affairs Council, the nonpartisan group that studies international policy.
Well California dreaming, right. No, screaming. The financial crisis hits home in the land of mansions and movie stars. The governor, a movie star in his own right, Arnold Schwarzenegger, has declared a fiscal emergency and called lawmakers into a special session. Their mission is to deal with the state's $11 billion deficit. Schwarzenegger has sided with Democrats. They're proposing a combination of tax hikes and spending cuts. Republican lawmakers refuse to raise taxes thus far.
Maybe another big airline merger on the horizon. British Airways confirms it's exploring a partnership with Australian rival Qantas Airways. British Airways is not saying how likely it is that the merger will actually happen, just confirming that the talks are going on.
Well a big week for the big three. A big day even. The automakers return to Washington in search of a bailout. More on that in just a second.
But first an event underway right now in Maryland to show you. This is a live picture, Chrysler's top execs holding a rally for that bailout. This is at the Port of Baltimore. Employees and state officials will discuss how important Chrysler is to the community and its economy. So they're making a sales pitch, if you will, directly to the people. Similar rallies are planned as well around the country. We'll keep an eye on that. Well, today the big three automakers are going to be submitting their recovery plans to Congress. At stake here, billions upon billions of dollars in taxpayer loans.
CNN's Kate Bolduan on Capitol Hill where they're going to be submitting these. Some are going to hand them in. Others are going to just shoot them over in an e-mail.
KATE BOLDUAN, CNN CORRESPONDENT: Some are going to throw them on the steps of the Capitol. This is the deadline date, T.J., the big three automakers are set to submit three separate plans, their own individual business plans trying to make the case once again why they should be getting an emergency loan, a bailout from Washington.
Many of the details are being kept pretty tight, pretty close to the chest right now. Some of those things that we have heard, GM as well as Ford has confirmed that their CEOs will accept $1.00 annual salaries if the government agrees to bail them out and give them this $25 billion loan that they're asking for. One Ford executive CNN has learned from says that their plan. It's going to be submitted via e- mail, is about 20 to 30 pages long with a heavy emphasis on plans for advanced technology.
This speaks to the viability aspect that lawmakers are really focused on. They say they just don't want to throw money at a problem. They want to see plans for the future, how these companies are going to sustain, are going to be successful down the road. Now this comes just two weeks, about two weeks after Congress sent the automakers home empty-handed.
As you said, T.J., with a homework assignment of, give us some answers. Give us some answers, we have a lot of questions. And some of the things that lawmakers want answers to are simply how much money they have, how much money they need to continue operations as well as how a loan will insure long-term viability. They're also looking to see from automakers how they plan to protect taxpayer dollars and also finally how they plan to offer and address health care and pension obligations of their workers.
So there are going to be a lot of details that they're going to be looking for here, T.J. and once they get them these plans will go to the key committees, the chairmen of these key committees. Then they'll lead back up here on Capitol Hill on Thursday and Friday to sit in more hearings and try to make their case once again. Hopefully they can do a better job of making their case to the lawmakers.
HOLMES: Well, in the meantime, Kate, don't get hit in the head with a flying bailout package as they drive by and just toss them out of the window at the Capitol.
Kate Bolduan, keeping an eye on things there. We'll see you again later when any news jumps out of there.
Well of course, making the case for that bailout, the automakers get ready for Capitol Hill. And our guest sets the stage, he's the Detroit bureau chief for the "Wall Street Journal." He will join us live. He's coming up in just a few minutes.
Yes, we are not done voting just yet. It's under way in Georgia in a Senate run-off with a lot riding on this outcome.
Republican incumbent Saxby Chambliss facing off against Democrat Rusty, excuse me -- Rusty, forgive me. I'm jumping the gun here. Chambliss is facing off against Jim Martin. Our Rusty Dornin --
RUSTY DORNIN, CNN CORRESPONDENT: I feel like I'm part of the race.
HOLMES: Yes, you are. Part of the race, we've seen you at a few campaign rallies. No, you're in Loganville here in Georgia right now. A lot riding on the race. And you can tell by the big names who have come to support these two.
DORNIN: It's really incredible T.J. the names who have come through Georgia. Of course, this race -- this seat very important, the Democrats only need two more seats to gain a filibuster-proof majority in the Senate. Of course, this seat here in the run-off and then there's the recap in Minnesota. For incumbent Republican Saxby Chambliss calling in the big guns, Republican dignitaries, Mitt Romney, Mike Huckabee, of course John McCain fresh off his presidential bid. But the big crowd-pleaser, of course, Sarah Palin. She came to Georgia Sunday night for a fund-raiser and then toured the state yesterday hitting four different cities, drawing thousands of people, and she hit hard on her message on the economy.
(BEGIN VIDEO CLIP)
GOV. SARAH PALIN (R), ALASKA: if our new president and if Congress, they seek to raise taxes, we need your senator from Georgia to vote against a nonsensical tax hike on all you and our small businesses. And that one vote, Georgia, that one vote could make all the difference to you and to our small businesses and to the entire U.S. economy. That one vote.
(END VIDEO CLIP)
DORNIN: Well Democratic Party sent in former President Bill Clinton and Vice President Al Gore among others. Of course, they were campaigning throughout the state. Kind of an unusual pairing, Jim Martin and rapper Ludacris in Atlanta last night trying to get out the young vote, trying to get the same kinds of numbers that Obama was able to generate and then Ludacris saying that people need to get to the polls.
(BEGIN VIDEO CLIP) CHRIS "LUDACRIS" BRIDGES, RAPPER: We know that this has been a red state for quite some time. But it's extremely important that we get out and vote tomorrow. I know a lot of people have misconceptions about it being a very long line. It's not going to be as long as it was when we went out there and voted for Mr. Obama.
(END VIDEO CLIP)
DORNIN: Of course, Mr. Obama did not come to Georgia. Many people say it's too risky for the president-elect to come to a race like this that is so uncertain. It might look bad for him, of course, if the Democrats lost. Turnout suspected to be not, of course, as heavy. Although at this particular precinct they've really been coming in. And a big mix. This particular precinct was split pretty evenly. They do say in these run-offs tend to favor the Republicans. So Chambliss was slightly in the lead of course in the general election and many folks now saying that perhaps could be the case now. T.J.
HOLMES: All right. We will see how this one pans out here in Georgia.
Rusty, we appreciate you.
And a lot of people asking for federal help these days, including the nation's governors. They're meeting today in Philadelphia where they will get to see the president-elect. They'll have his ear. Barack Obama. CNN's Suzanne Malveaux joins us now live from Philadelphia this morning.
Suzanne, good morning again to you. And they have a heck of a wish list and a lot of zeros at the end of that wish list.
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: They certainly do, T.J.
President-elect Barack Obama is going to be talking to this group of governors. And they essentially want some money, a piece of the pie. We're talking about that $500 billion economic stimulus package. Well, they want at least a third of that to help with their own crippling economies. It was very interesting, the governor of Pennsylvania, Ed Rendell who is the chair of this group who helped organize this was setting the ground rules for the Q&A session with Obama. And he said they have about 70 minutes or so.
They said unlike their visits at the White House where the questions are pre screened, they're going to be able to ask anything, they're going to be able to say anything, make comments to him. That this is really supposed to be a back and forth to allow the governors to talk directly with the president-elect about what they feel are the problems in their own states, what the solutions are, and a lot of that, T.J. and obviously is about the dollars, it's about the money.
They feel that they've got projects that they can jump start right away and that this will help actually create jobs. Rendell saying every $1 billion he thinks will create about 40,000 substantial jobs. So obviously that is the case that they're going to be making to President-elect Obama.
Not everybody agrees with that, however. There are some governors -- the governors of South Carolina and Texas in an editorial in the "Wall street Journal" this morning saying they don't think that's going to help. They think it's a waste that it's just more debt. But most of these governors here meeting with Obama believe that they want a piece of that pie and a very substantial piece, T.J.
HOLMES: A substantial piece. We'll see if they get it. Barack Obama not inaugurated yet but is already fielding requests. Suzanne Malveaux for us in Philadelphia. Thank you so much. We want to let our viewers as well know that pictures you're seeing on the right side of your screen.
That is a live picture. You can put that back up. Barack Obama, starting to greet some of these governors who have gathered there in Philadelphia. There he is. We're waiting on him. He's going to be stepping up we expect in a short time. He's going to be making some comments. We'll take those live. But again, he's just arriving now to meet with the governors.
I believe one of the first times if not the first time he's left Chicago actually since he was elected president. He's been doing a lot with his transition team, also set up there in Chicago. But stepping out because this is an important enough meeting, as Suzanne said, they're requesting billions upon billions, hundreds of billions for these governors and fir their states who have been hurting in this economic downturn just like the federal government and so many others out there. We'll keep an eye on this when he steps up. We have some comments. And we'll bring that to you.
We've got new video to show you that's just been released, the chaos last week at a train station in Mumbai that was under attack by gunmen. These scenes reported by closed circuit TV in the restaurant at the station. It was one of seven locations targeted by terrorists, at least 179 people were killed. Among them a rabbi and his wife at an Orthodox Jewish Center. Today thousands gathered to pay them final tribute. Among the mourners Israel president was along. We'll go live to Mumbai later this hour for the very latest in the investigation into those attacks.
Well the deadline for the big three we've been talking about today, automakers give their final report to Congress, but will lawmakers give this bailout a passing grade?
(COMMERCIAL BREAK)
HOLMES: All right. The big three charting a course for recovery. Today they submit those plans to Congress in hopes of securing billions of dollars in taxpayer loans. The car makers say their very survival may hang in the balance. We'll talk with someone who knows this industry, inside and out Neal Boudette is his name. He is the Detroit bureau chief for the "Wall Street Journal."
They say they need this money. They say they cannot fail. What is the consensus? Is there anything close to a consensus about whether or not these companies are too big to fail as everybody keeps saying?
NEAL BOUDETTE, WSJ DETROIT BUREAU CHIEF: Well everybody agrees that if one of these companies collapses goes into bankruptcy, there will be a broad impact because it would affect a lot of suppliers and companies spread out all across the Midwest as well as dealers who are in every city and town in every state in the country. So there would be a broad impact. I think Congress will probably come through with some help for these companies this time around.
HOLMES: So is this just, would you say, a show, if you will, by Congress wanting to look like they're tough. They already know they're going to give them the money. But they need to at least act like they're putting them under a high level of scrutiny and really asking the right questions ahead of time.
BOUDETTE: Well they are giving them a second chance. But I think Congress is doing the right thing. You know you just don't want to just write a check for $25 billion and tell these companies to go off and spend it anyway they want. They're asking them to come back and spell out in detail, what are you going to do with the money? How are you going to fundamentally change your companies to be viable and more competitive? Because right now all three of them are losing money and they're burning cash and they're not competitive.
HOLMES: That's the other thing. You said how are you going to fundamentally change, is what the congressmen and women want to know. So will we see an end to GM, Ford and Chrysler as we know them? Are we going to see three entirely different companies emerge?
BOUDETTE: Well, I think GM and Ford are big enough and global enough that they can survive a stand-alone companies. I think both of them have to put more emphasis on cars, and small cars than they have in the past. They do get a lot of sales from trucks and SUVs still today. Chrysler is different. They're a North America only company. They really don't have sales outside of North America. And I think Chrysler's future, if they're going to survive, is really in partnering up with a foreign automaker, maybe Nissan or somebody else.
HARRIS: Will Congress, do you think, essentially be responsible for the long-term viability and success of these companies since they're asking these companies to submit plans. Congress is saying, OK, that's a good plan. I mean I guess for the congressmen and women, what is their background and what expertise do they have in forming a plan to show how a business will work, show how a business will succeed? That's essentially what they're doing.
BOUDETTE: Well, we do have a precedent here. In 1979 Chrysler got a bailout, a government-backed loans to help them. The government set up an oversight board that kept an eye on what the company was doing. They didn't give them all the money up front. It came in chunks. They got some money. When they meet their goals and targets and kept their promises of what they were going to do, they got more money. And so it could work this time around. It's not necessarily the government dictating how they have to run the companies, but really keeping an eye on making sure that the companies are following through and doing what they say they're going to do.
HOLMES: All right. The plans are being submitted today. I believe some of that information is trickling in and trickling out as well. They'll be back, some of the big CEOs on Capitol Hill later this week. Mr. Neal Boudette, we appreciate your time and expertise. We'll see you again.
BOUDETTE: A pleasure. All right.
HOLMES: We turn back to the president-elect now. There he is with Governor Ed Rendell of Philadelphia. President-elect meeting with the governors at the NGA up in Philadelphia today, of course being hosted by the governor there to his right. Obama expected to hear a lot, get an earful pretty much from these governors who are struggling right now. Their states pretty much badly in debt.
When he begins to talk at that podium, we will listen in to what he has to say to them. Stay right here. We'll keep an eye on it.
(COMMERCIAL BREAK)
HOLMES: Well China's milk problems may have been worse than originally thought. China's healthy ministry say six children may have died from milk powder contaminated with melamine. Earlier reports from the World Health organization said four children died. The new report also says that milk made almost 300,000 children sick, that's six times the original estimate of 50,000.
There are also new rules for medical residents to tell you about. A report released just moments ago, proposes major changes to the way hospitals use their residents. We'll get to that story in just a moment.
However, our Christine Romans standing by for us. We got more business news here. We're waiting on these plans to come in from the big three automakers about how they're going to change how they do business. We have at least one plan.
Who put this one out?
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Ford has released to Congress its plan for how it will return to profitability or break- even by the year 2011. Congress said, look, before we give you access to any bridge loans or any kind of a bailout for the automakers, we want a better plan of how the big three automakers will become viable. So the Ford Motor Company have submitted its business plan to Congress. And among the details of its strategy is a pretty elaborate hybrid alternative energy kind of strategy. It wants an electric car, a full battery electric car in a van, a commercial vehicle like van, ready for 2010.
HOLMES: All right. Christine, I know we're going to keep talking about this. We need to jump in here. Because we're going to continue with this theme of the economy. Right now again Barack Obama and Joe Biden seen there addressing the governors who need some help on their financial crisis in each of their own state. Let's listen to Joe Biden.
(JOINED IN PROGRESS)
JOE BIDEN, VICE-PRESIDENT ELECT: ... I just want you all to know the reason I love these kinds of get-togethers is you sit in the order in which your admission to the union occurred. That's the first time Delaware, the new governor elect sits in the first seat there. Governor, it's nice so see you sitting there, Jack Martel. I want to thank all of you for being here. And Governor Palin, I want to thank you particularly. I might point out as I told you, we walked in. Since the race is over, no one pays attention to me at all. Maybe you'll walk outside with me or something later and say hello to me.
It's great to see you, governor. Thank you.
By the way, I think it is -- I hope the whole country can see a metaphor for the fact that this election is over. Here we are, we're all together, we're all dealing with a common problem. This is not as was stated so many times by all of you and us. This is not a Democrat or Republican problem. We've got ourselves a problem. And the truth of the matter is during this campaign I had an opportunity like all of us who ran to be in many of your states.
In many of the cases I rode on buses and long trips across half a dozen of your states with some of you in the bus. And I don't know how many times I heard the commentaries, we'd ride by and you heard it, too, Barack "this used to be," point to a facility and this used to be a steel mill, this used to be a manufacturing plant. Well the fact of the matter is, I heard from all of you as well that in this town there were 1,200 jobs.
Now the town is actually losing population in this facility. And the question is here, you know, how are we going to know we turned the corner? I think we're going to know we turn the corner if you ride by those same facility and instead of hearing you and us say "this used to be," hear us say "this is going to be." This is going to be a new facility to build windmill, parks and windmill. This is going to be the place where we are going to employ "x" number of people. And the truth of the matter is, one of the reasons why the president-elect wanted this meeting to take place is that we understand we need to build a stronger and a more consequential partnership with each one of you.
And that's why we're here, not only to discuss with you what -- in broad strokes what we think needs to be done, but to listen. Because you are, as that old expression goes, you're where the rubber meets the road. You all as pointed out don't have the flexibility the federal government has which I assume that means you're not going to criticize us for running the deficit to help you.
I know none of would do that. but all kidding aside, you know we think there's a need for a different relationship between the federal government and the governors. You know Eric Sevareid who used to be a commentator on television once said to President Kennedy, he said it doesn't make sense when two people are sitting in the boat for one of them to point a finger accusingly at the other and say your end of the boat is sinking.
The truth of the matter is, as corny as it sounds, we are all in this boat together. And if you sink, the country sinks. If you float, the country does very well. And so Barack and I recognize this, and we recognize that you all have been hit incredibly hard by this economic crisis, and that has been pointed out by the governor. You don't have the flexibility that the federal government has to deal with the crises immediately at hand. Already 41 of your states are looking at budget short falls for next year. And that's why help for you, everything from direct aid to counter cyclical investments to benefit programs to infrastructure investments will be key parts of our economic plan.
On infrastructure specifically, and I know I sound like a hobby horse with Governor Rendell and others on this, but we have I think a huge opportunity, a huge opportunity. China invests between seven and nine percent of their GDP in infrastructure projects. We invest as a nation over the last decade or more, less than one percent. And there's a reason that when you turned on the Olympics to watch them this past summer, you saw med leave train going over 200 miles an hour in supposedly a third world country in terms of its economy, blowing into town, dealing with the environmental problems they have as well as transporting people in a way that we don't even come close to being able to do. And as Barack has pointed out, and John Corzine knows, I may have a bit of a pro-rail bias.
But I think of the jobs we can create in both construction and innovation if we make similarly bold investments here in the United States as well as the environmental payoff that flows from that kind of investment. We all know the criticism. We hear it, that Japan invested over a trillion dollars in infrastructure and nothing happened. Well it's all about how rapidly, how rapidly we can get these projects up and running. And many of you, if not all of you, have on the boards -- engineering has already been done, plans that already are ready to go, that can be kicked off very, very quickly. And that's why we envisioned fast track funding for thousands of these ready to go projects across the country that can quickly, quickly put people back to work and, equally as important, can lay a long-term foundation for how it is going to contribute to the overall economic growth of the country for the next couple decades.
In the longer term, we're calling for the creation of national infrastructure reinvestment bank that will help us to make investments that we need to build out the 21st century transportation system while creating jobs, and as was pointed out by the president elect earlier and Governor Rendell, by taking politics out of the infrastructure spending. Such investments have the added advantage, I might point out, of making our companies based here in the United States more competitive when they compete internationally.
So this is more than a zero sum game. There's a lot of benefits that flow from these investments beyond the immediate investment of generating new jobs and money into the marketplace. So we believe together we can make this country, again, in the words of Ralph Waldo Emerson, a place of beginnings, of projects, of vast designs and expectations. And despite all of our challenges, I'm struck by the hopefulness that not only the people of America have but you as governors, you as leaders have.
We ought to be able to -- we understand how serious these challenges are. But we also believe that with leadership from all of us in this room, that there's not a single thing we can't do. We've faced -- to state the obvious -- we've faced more difficult times than this in the past. And perhaps most importantly, in my view at least, the president-elect, Barack Obama, understands that change is a means, not an end and together that we can change what used to be there to what is going to be there. I don't think it's beyond our capacity to do that.
And let me conclude by saying that I know you share this view, at least I believe most of you share this view. This is a time for us to be bold. This is a time for us to seize the moment and the opportunity to literally set America back on a glide path of real, genuine prosperity and growth. I think it's a genuine opportunity. I know Barack feels that way even more passionately.
So it's now my pleasure to introduce the man who literally has inspired a nation and whom I'm honored to join as a partner, President-elect Barack Obama.
(APPLAUSE)
BARACK OBAMA (D), PRESIDENT-ELECT: Thank you. Thank you everybody. Thank you.
Well, to begin with, let me thank Governor Rendell for his wonderful hospitality in this extraordinary setting. Governor Douglas, thank you so much for your outstanding work. And to all of you, I've -- one of the great pleasures of running for president is the opportunity to meet people all across the country. And I've become friends with many of you. Those of you who I have no yet gotten to know, I'm hopeful that over the course of the next four years, that I've got an opportunity to work with you closely.
In fact, being with governors is a little bit like a homecoming for me because while I stand here today or sit here today as president-elect, I will never forget the fact that I got started in state government. And it is in state and local governments that the most meaningful changes take place and some of the most difficult decisions have to be made. And nobody, I think, is more in tune and in touch and mindful with what is going on across the country than the nation's governors.
So I'm going to spend most of my time here today listening and not making a long speech. I do want to give you a little bit of context for how we are thinking about the issues at this point.
I recognize that every single one of you is struggling to come up with a budget at a time when you're facing great and growing needs. More and more people are turning to you for help for health care, for affordable housing, to prevent foreclosures, even as the credit markets are tightening and tax revenues are making it more difficult to provide that help. 41 of the states that are represented here are likely to face budget shortfalls this year or next, forcing you to choose between reigning in spending an raising taxes. Jobs are being cut. Programs for the needy are at risk. Libraries are being closed, and historic sites are being closed. Right here in Philadelphia, as Ed has already remarked, we've got over 200 workers being laid off, hundreds of positions are being left unfilled or being eliminated.
Meanwhile, virtually all of you are facing the additional challenge of state constitutions that require you to balance your budgets. So you're placed in an extraordinarily painful choice of violating your constitutional responsibilities or upholding those responsibilities at the expense of helping families.
So to solve this crisis, and to ease the burden on our states, we're going to need action and we're going to need action swiftly. That means passing an economic recovery plan that helps both Wall Street and Main Street and this administration does not intend to delay in getting you the help that we need.
We intend to help save or create 2.5 million jobs. We intend to put tax cuts into the pockets of hard-pressed middle class families in your states. And we intend, as has already been discussed, to start making a down payment on the critical investments that are going to be necessary to sustain long-term economic growth as well as pull us out of the current slump.
But the reason this meeting was so important to Joe and myself is because we recognize that change is not going to come from Washington alone. It's going to come from all of you. It will come from a White House and state houses all across the country that are working together, and that's the kind of partnership that I intend to forge as president of the United States. I hope that this is the beginning of laying that foundation.
Over the next few hours, I'm looking forward to hearing from you about the problems you're facing, learning about the work that you're doing, experiments that are working, things that are not working, where you think an investment on the part of the federal government will make the biggest difference, how we can reduce health care costs, rebuild our roads, our bridges, our schools and ensure that more families can stay in their homes.
But the partnership we begin here cannot and will not end here. As president, I'm not simply asking the nation's governors to help implement our economic plan; I'm going to be interested in you helping to draft and shape that economic plan. My attitude is that if we're listening to the governors, then the money that we spend is going to be well spent. And it means that it's going to get working faster and the people in your states are going to experience prosperity sooner.
Now, let me just wrap up by saying this, I know these are difficult times. I don't think anybody here is viewing the situation through rose-colored glasses. We're going to have to make some hard choices in the months ahead about how to invest these tax dollars. We're going to have to make hard choices like the ones that you're making right now in your state capitals, we're going to have to make in Washington. And we are not, as a nation, going to be able to just keep on printing money, so at some point we're also going to have to make some long-term decisions in terms of fiscal responsibility. And not all of those choices are going to be popular.
But what I can promise you is this, that I'm going to listen to you, that I'm going to seek your counsel. And by the way, I'm going to listen to you especially when we disagree, because one of the things that has served me well at least in my career is discovering that I don't know everything. And all of you, I think, are going to be extraordinary important in keeping us on track, not allowing Joe and myself to get infected with Washingtonitis, and to constantly be reminded of the realities that are happening to folks back home.
A special message I want to deliver to my Republican colleagues who are here. I offer you the same hand of friendship, the same commitment to partnership as I do my Democratic colleagues. There is a time for campaigning, and there is a time for governing. And one of the messages that Joe and I want to continually send is that we are not going to be hampered by ideology in trying to get this country back on track. We want to figure out what works.
That doesn't mean that we're not going to have some disagreements, but what it does mean is that, if you can show me something you are doing that's working, or if you tell me that this program or this regulation is hampering us from doing smart things that will advance the interests of our state, then you're going to have a ready ear. And that is going to be something that I want everybody to understand.
(APPLAUSE)
So, I think it was Justice Brandeis who said during a period of much greater turmoil in the markets, although I haven't checked what's happening right now, but -- that we're experiencing at the moment. He said, a single courageous state may, if its citizens choose, serve as a laboratory, experimenting with innovative solutions to our economic problems. That's the spirit of courage and ingenuity and sticktoitness that so many of you embody. That's the spirit that I want to reclaim for the country as a whole, one where states are testing ideas, where Washington is investing in what works and where you and I are working together in partnership on behalf of the great citizens of this nation.
So with that, let me stop, and I think that I'm going to hear some presentations from some of the governors. And then I will be available to answer questions. And let's have a conversation for the next few minutes. I think at this point the press may be leaving. So you guys --
HOLMES: All right. Again, listening in to Barack Obama saying he is there to listen and not to talk. He is there with the governors, the NGA -- governors' association meeting in Philadelphia today, there with his vice president, Joe Biden. Delivering some comments, telling the governors that he is there to help, wants to forge partnerships with all of them to help solve a crisis that doesn't just affect governors. Republicans, Democrats, all states right now being affected. And there saying he is there to help and there to listen. They're asking for $100-plus billion in a package -- a surplus -- or an aide package that we expect to be implemented, or Barack Obama wants implemented, after he gets into office. They do want a chunk of that package. So we will see what happens. But he's there to listen. We'll continue to monitor that meeting in Philadelphia.
Right before we went to that meeting in Philadelphia, we were hearing from our Christine Romans about the Big Three and their plans, how they're going to reshape themselves and possibly get that big chunk of money from Congress, a big bailout, if you will. Well, Ford has submitted their plan to Congress. We will get to her details about that plan after break.
(COMMERCIAL BREAK)
HOLMES: Ford has a plan. We are seeing that plan now. But is that plan going to be good enough for them to be shown the money by Congress? Christine Romans, we got cut off just a minute ago when you were trying to explain that plan to us. Susan Lisovicz is going to be chiming in on this conversation as well with the New York Stock Exchange.
But Christine, back to you. Take us through it now. What are the major points they have submitted now?
ROMANS: OK, let me give you the headlines then: Ford said that if it should access government cash in the form of a bridge loan, a $9 billion bridge loan, then Alan Mulally, the CEO of the company, would take a $1.00 a year salary, the company is going to sell its five corporate jets. You can remember the outrage --
HOLMES: Oh yes.
ROMANS: -- on Capitol Hill when the CEOs of Ford, GM and Chrysler went in separate corporate jets to ask for government money. Mulally, the Ford CEO, says that he wants access to $9 billion, a bridge loan from the government of $9 billion, access to it as a safeguard or a backstop. But they hope that they won't have to use it. They're seen by many analysts as in a better position even than a couple of the other -- GM and Chrysler.
Among the things they say they hope to return to break-even or even make a profit in the year 2011 -- they want to invest about $14 billion in the U.S. on advanced technologies. And they want a greater, greater proportion of their cars to actually be dependent on advanced technologies. A whole family of hybrids and plug-in cars and full battery-electric vehicles, a commercial van, a battery-electric commercial van, by the year 2010 to be on the market.
Among other things, they say that they've got -- some of the other things that they've been telling us that they want to continue to do, they are talking about selling Volvo. They've already sold quite a few brands over the past year, Aston Martin, Jaguar, Land Rover and others, and also a majority of their share in Mazda. So this is a company that has already had to sell off some of its brands, coming to Congress, trying to telling Congress what it is going to do to become -- quote, unquote -- "viable." It says it wants to be break even -- hopes to be break even by 2011.
Some of the analysts are already weighing in and saying they haven't really given a lot more in terms of the cost cutting or dramatic cost cuts that they're going to do.
But again, the CEO saying he would take a $1.00 salary if they get access to this government loan, and it's a $9 billion bridge loan that they are looking for and they hope -- they hope that they don't have to use it. But basically, moving in a direction, a transformational change in the company, is the way he put it -- the CEO of the company put it -- toward smaller vehicles, fuel efficient vehicles, really going for fuel efficiency here and advanced technology.
HOLMES: And Christine, one more quick (INAUDIBLE) to you here, they talk about -- there is not as much cost cutting, you say some critics and people already coming out saying not that much cost cutting. There is some meat to this talking about the $9 billion they want access to, the $14 billion in advance technology and so on and so forth, selling off some brands. But, things like the selling of the jets and the $1.00 salary, those are just things that kind of sweeten the deal and make it sound good. And you can make a pitch to the public, if you will, that hey, that sounds great.
ROMANS: That is absolutely right.
And let me say, cost-cutting, I want to be very clear, all of these three automakers have done tremendous cost-cutting over the past few years. They've had to. They've been losing money hand over fist for some time. So they've already done quite a bit of cost cutting. They've cut a lot of jobs, all of them have.
And what I'm saying here is in terms of this new business plan, I'm looking in here. I don't see a lot new -- new, surprising kinds of cost cutting. So we'll dig into what they have to say to Congress, we will. But the headline is what I just gave you, a real switch toward fuel efficiency, a switch toward smaller vehicles, hybrid vehicles, a switch toward advanced technologies, hoping to get break even by the year 2011, a $1.00 salary, selling off the corporate jets and then of course, a $9 billion bridge loan is what they're asking for. But the company says they hope they don't have to use it.
HOLMES: All right, Christine, thank you.
Susan Lisovicz is at the New York Stock Exchange.
Susan, do we expect any kind of reaction from the markets once this plan comes out?
SUSAN LISOVICZ, CNN CORRESPONDENT: Well there already has been a reaction, a huge reaction, T.J.
Ford shares are up 13 percent and actually gained traction once the plan officially came out. But there's a lot of hope that they'll meet better reception this time. And one of the reasons why is that the three executives are expected to drive to Washington this time, or at least fly commercial.
Christine basically gave all the right bullet points. But having said that $1.00 a year salary and selling some private jets isn't really Detroit's problem. Detroit's problem is selling cars people want to buy at a time when people are losing jobs, access to credit is tight and Japan has been eating their lunch. So, you know, switching to these fuel efficient cars is a huge hurdle. It is a big seismic change for Detroit. And that will cost money and time.
So, that's why it needs a $9 billion loan. And that's why the Big Three, in general, are asking for $25 billion.
HOLMES: We will see how Congress reacts to this plan now submitted, and a couple more plans coming today from GM, also from Chrysler.
Susan Lisovicz at the New York Stock Exchange, thank you so much.
We will turn next to a star's family tragedy. There's now been an arrest in the killings of Jennifer Hudson's family members. It was her brother, her mother and her young nephew.
(COMMERCIAL BREAK)
HOLMES: There has been an arrest in connection with the killings of the mother, brother and nephew of Oscar-winner Jennifer Hudson. Police have arrested William Balfour, that's Hudson's estranged brother-in-law, in connection with the October killings. Hudson's mother and brother were found shot to death in their South Side Chicago home. The body of her 7-year-old nephew was found days later in an abandoned SUV. Balfour's mother is adamant that her son is innocent.
(BEGIN VIDEO CLIP)
MICHELE DAVIS-BALFOUR, MOTHER OF POSSIBLE SUSPECT: My son did not do this. I'm sick of this. They need to focus on somebody else.
JOSH KUTNICK, ATTORNEY: Any evidence pointing to Mr. Balfour is not even thin; it is very, very weak.
(END VIDEO CLIP)
HOLMES: Well Balfour spent nearly seven years in prison for attempted murder. He was free on parole when the victims were shot.
Plaxico Burress, are you kidding me? Giants wide receiver catching more heat after accidentally shooting himself in the leg in a New York nightclub. He's charged with two counts of criminal possession of a weapon. He is out on $100,000 bail.
Meanwhile, the hospital that treated Burress also being criticized for failing to notify police about a gun-related injury, which is of course mandatory under New York law.
Well in gray hair and flowered dress, the Wal-Mart shopper didn't raise any suspicions until she -- well, he raised his gun.
(BEGIN VIDEO CLIP)
ANGIE FINCANNON, VICTIM: It looked like actually an elderly woman. And when he got to the register, that's whenever I saw the gun go up and the two shots went off.
(END VIDEO CLIP)
HOLMES: Yes, that is no Wal-Mart greeter. Authorities say the wig and the cross-dresser's car have been found, but they haven't found him just yet. No word on whether he got away with any money.
Trying to keep families in their homes, the FDIC floating a mortgage relief plan. We'll talk to the Chairwoman, Sheila Bair about it.
(COMMERCIAL BREAK)
HOLMES: Well you can call it the brotherhood of the traveling card. It's been the gift that's been giving for 60 years now. Roger Weber from our affiliate WDIV with this one.
(BEGIN VIDEOTAPE)
ROGER WEBER, WDIV REPORTER: It may be the most well-traveled Christmas card in America. Art Hebel first saw it 60 years ago when his mom bought a box of cards at a school fundraiser.
ART HEBEL, SENT DURABLE CHRISTMAS CARD: And I says I want a card to give to my friend.
WEBER: The first time he hand delivered it to Bill Nichols (ph). In 1948, they were inseparable buddies growing up in Richmond. The next year Bill unwittingly began an odd tradition.
HEBEL: I called him a cheapskate because he gave me the same card back. And I says, all right. I put it away. And next year I crossed his name off and wrote my name on and put ha ha and I gave it back to him.
WEBER: The exchange continued as Art went from grade school, to high school, to marriage, to retirement in his old house on Main Street in Richmond. Bill eventually moved to Indiana. He gets the card one year. Art gets it the next.
HEBEL: When I receive it, I put it away. I show it. That's it. And then I put it away and that's where it stays all year.
WEBER: They only write their names and the year inside the card. Messages are inserted on other paper. It's the only time they communicate. For safe keeping the card has been copied. And every year it's sent by certified mail.
HEBEL: But it's worth it.
WEBER (on camera): Why is it worth it?
HEBEL: Because the card is so valuable to us. Maybe not anybody else, but between him and I, the card means a lot.
WEBER (voice over): Now and then they've skipped the exchange. But Art believes it is going to keep going until one of them dies.
(on camera): Next week, Art will sign and date the card and pop it in the mail to Ft. Wayne, Indiana. And knock on wood, it will be coming back to McComb County same time next year.
In Richmond, I'm Roger Weber, Local 4.
(END VIDEOTAPE)
HOLMES: All right. Well thank you all for being here. I'm T.J. Holmes, again sitting in for Heidi.
You can join -- I believe Heidi is back tomorrow here at 9:00 Eastern time.
Now, time to hand over the CNN NEWSROOM to my dear friend, Tony Harris.
Take it away, Tony.
