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Bailing Detroit; Obama Economic Plans; Red Cross Christmas Card Volunteers
Aired December 06, 2008 - 12:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
FREDRICKA WHITFIELD, CNN NEWS ANCHOR: All right, signs of grudging on Capitol Hill, certainly tears there because something just might have to be done to rescue the big three. Congressional staffers are working on a plan this weekend. CNN Congressional correspondent Dana Bash has details.
(BEGIN VIDEOTAPE)
DANA BASH, CNN CONGRESSIONAL CORRESPONDENT (voice-over): Auto executives returned minutes after news broke of the worst unemployment report in three decades. And the committee chairman called it evidence why Washington cannot let Detroit fail.
REP BARNEY FRANK (D), FINANCIAL SERVICES COMMITTEE: In the midst of the worst economic situation since the Great Depression, it would be an unmitigated disaster.
BASH: Skepticism still dominated about whether $34 billion taxpayer dollars can really put struggling auto companies on the road to profitability.
REP DONALD MANZULLO (R), ILLINOIS: We need to encourage Americans to start buying cars again, and that is not in any of the plans.
BASH: Yet, concern that an estimated three million more jobs could be lost if the big three collapse yielded signs lawmakers may finally be ready to seriously look for compromise.
REP PETER KING (R), NEW YORK: But the fact is I think the time for posturing is gone, the time for partisanship is gone. We have to address this very, very seriously.
BASH: One idea gaining traction among Democrats, condition any loan on the government restructuring the auto companies by either an oversight board or individual appointed by the president.
But leading Republicans say they'd only go for that if auto unions gave concessions on wages and benefits, and the United Auto Workers opened the door to that.
RON GETTELFINGER, UAW PRESIDENT: Yes, sir, we are willing to go back to the bargaining table, providing everybody else comes to the table, as well.
BASH: But it could be near impossible for deeply divided lawmakers to quickly agree on major restructuring in Detroit. So, one veteran Democrat suggested a short-term bridge loan to GM and Chrysler to avoid collapse, but along with his idea, a lecture.
REP PAUL KANJORSKI (D), PENNSYLVANIA: It almost looks to me like you hope that with that target coming down on us, you're going to get us to do something and just throw the money out there and say, go ahead, do with it as you will.
BASH: And there is now a significant development that could open the door to compromise on an auto bailout. Two Congressional sources tell CNN, House Speaker Nancy Pelosi has backed down on her opposition to rescuing the auto industry by using money intended to make cars environmentally sound, which President Bush and Congressional Republicans support.
One official said that she reversed herself because the devastating job loss report changed everything and Washington simply cannot let Detroit collapse.
Dana Bash, CNN, Capitol Hill.
(END VIDEOTAPE)
WHITFIELD: Well, it's not just the auto industry, but other job markets are also in trouble. Just take a look at these numbers. More than a half million Americans lost their jobs in November alone. That makes almost two million jobless Americans just this year.
The big losers? Retail, manufacturing, construction and the hotel and restaurant industries. One bright spot, healthcare. It gained 34,000 jobs in November, 369,000 for the year.
Well, one idea in Washington right now, provide Detroit automakers, in particular, with enough help to actually get through the month of March. Then it will be up to the new Congress and the new president to decide exactly what to do next.
CNN's senior political correspondent Candy Crowley is covering the Obama transition team in Chicago.
So, what is the Obama team or even thinking about while trying to deal with the very pressing economic issues, namely of jobs.
CANDY CROWLEY, CNN SR POLITICAL CORRESPONDENT: Well, as concerns the auto industry each before the election, members of the Obama team have been reaching out to the auto industry, auto execs, saying what's the problem, tell us, you know, a little bit about what's going on in the industry. Those talks have continued since the election as the Obama administration tries to -- as the Obama economic team tries to put together some options for plans for long-term-range help to the auto industries which would include revamping their business model, as they say.
Beyond, that of course, there are so many other economic problems. It's been almost a non-stop subject for Barack Obama who did talk about it a bit today in his radio address, which is now available, online. And he laid out a couple of things that are going to be in his overall economic recovery plan, including one that he hopes will create a lot of jobs.
(BEGIN VIDEO CLIP)
BARACK OBAMA (D), UNITED STATES PRESIDENT-ELECT: We will create millions of jobs by making the single largest, new investment in our national infrastructure since the creation of the federal highway system in the 1950s. We'll invest your precious tax dollars in new and smarter ways, and we'll set a simple rule: Use it or lose it. If a state doesn't act quickly to invest in roads and bridges in their communities, they'll lose the money.
(END VIDEO CLIP)
CROWLEY: It is a pretty ambitious plan overall and it is unclear right now exactly what he wants to put in place immediately and what is longer range. For instance, one of the things that he talked about today in that radio address was revamping the federal government buildings, public buildings. He says that the U.S. government is the biggest consumer of energy over everybody else in the world. So, he wants to help revamp some of those heating systems and put in new light bulbs, he says it will save billions of dollars for taxpayers.
So, there are a number of ways they are going at it. We have yet to see the entire plan. But, it's something that he will continue to talk about between now and January 20 - Fredericka.
WHITFIELD: n long-term trying to save money as it pertains to energy it will cost a lot of money in order to kind of reconvert a lot of those buildings.
Meantime, let's talk about something else to look forward, really in the immediate future. We're talking tomorrow, possibly another cabinet announcement for the Obama team?
CROWLEY: Yes, he had planned and does plan a news conference tomorrow. It's Pearl Harbor Day, the anniversary of Pearl Harbor Day. So, it was originally billed that he wanted to use the time to salute those who have served and still serve their country, and indeed it will be that, but we will also get his choice for head of the Veterans Administration. Obviously a very suiting position to announce tomorrow on Pearl Harbor Day. So, still getting that cabinet together and another one we expect tomorrow.
WHITFIELD: All right, already, what? More than half that have been named so far. All right, thanks so much.
CROWLEY: Getting there.
WHITFIELD: Candy Crowley there in Chicago with the Obama team.
All right. Well, back to the situation in Detroit. Many Americans still not quite convinced that Detroit automakers deserve a rescue. Here now is CNN iReport correspondent, Errol Barnett.
(BEGIN VIDEOTAPE) ERROL BARNETT, CNN IREPORT CORRESPONDENT: On ireport.com the questions directed to the CEOs of the big three really give you a sense of how bad things are for the average American. You can see more evidence of that in this year's unemployment numbers.
More than half a million people lost their jobs, more than expected, bringing this year's total job losses to 1.9 million. So, bailing out the big three American car companies with taxpayer money, and still a very unpopular idea.
Now, when we gave our iReporters the chance to ask the CEOs of the companies a question they turned the cameras themselves and directly to David Wight. He lives in Washington where the hearings are taking place. Here's his question.
(BEGIN VIDEO CLIP)
DAVID WHITE, IREPORTER: What are the chances that the American people can get a guarantee from you, the big three, here today, that you will start building vehicles that will be more reliable? Many Americans are sick and tired of investing their money on vehicles that end up with a Flintstone transmission. You know what a Flintstone transmission is, don't you? It's this, we don't like walking, when we're paying for a vehicle.
(END VIDEO CLIP)
BARNETT: All right, pretty straightforward, there. How can they make American cars more reliable? Well, Chrysler CEO, Robert Nardelli, answered David White's question in an interview with Wolf Blitzer yesterday after the senate hearings. Here's Nardelli's response.
(BEGIN VIDEO CLIP)
ROBERT NARDELLI, CHRYSLER CEO: We spend about half a billion dollars in the first several months. Our warranty costs are down 29 percent. It's an interesting -- it's an interesting comparison because in the hearing today, going around the panel, the majority of the senators said that -- citing specific vehicles that they own that they've got 60, 70, 80,000 miles, the comment was, hey, you guys are making them too good and therefore we're not buying vehicles and we're contributing to your problem. That was from the senators on the committee, today.
(END VIDEO CLIP)
BARNETT: Right, there it is. That was Nardelli speaking, yesterday. Janet Bolero (ph), here, says the CEO of Chrysler didn't really answer David's question. But what about David? What did the IReporter who asked the question think of Robert Nardelli's response? Well, he uploaded this video reaction. Take a look.
(BEGIN VIDEO CLIP)
WHITE: Damn. How in the world can you sit here and tell me that these cars are built so well that you're losing money on them? Well, if you're losing money because people -- here's my thing. If the American people had that much confidence in the quality of your construction, you shouldn't be losing money, you should be oozing money.
(END VIDEO CLIP)
BARNETT: There he is. He's an expressive guy. But that's just one animated example of the many unhappy Americans during this bailout debate. From the CNN Center.
(END VIDEOTAPE)
WHITFIELD: All right, that's Errol Barnett. Thanks so much.
Of course we want to hear from you, too. What do you think about a possible auto bailout for America's big three? Do you think you'd get a significant return on your investment if taxpayers are indeed to help resuscitate the industry? We're taking your e-mails and we'll take them on the air.
(COMMERCIAL BREAK)
WHITFIELD: All right. The question is very simple. Should there be a bailout of American auto's big three. We're asking that question to you, we're taking in your e-mails and we're also going to be posing this question to Chris Isidore who covers the auto industry for CNNmoney.com. He's joining us from New York.
Good to see you, Chris.
CHRIS ISIDORE, CNNMONEY.COM: Good to see you.
WHITFIELD: OK, so, you know, it is a hard sell, is it not, for Americans to hear these big three automakers say we need some money to help keep us afloat when so many people left and right are losing their jobs, their industries are not getting a bailout. Did the CEOs of these companies make a good sell?
ISIDORE: They made a much better sell this week than they did two weeks ago. Two weeks ago their appearance before Congress was nothing short of disastrous, they didn't have good answers for how they would spend the money, how they came up with the $25 billion they came up with at that time, how they would get to the point where they'd be profitable again and Congress and members of the public were furious.
The polls done before their appearance showed that their support for a bailout, the CNN poll that was done after that appearance two weeks ago showed they shifted 180 degrees opposed to the bailout.
(CROSSTALK)
WHITFIELD: And I guess in part because then there was some argument that, you know, the CEOs didn't do a good job of talking about viability. How important is this industry to the rest of America and how bad is the situation for them? There weren't real hard, concrete numbers, so the CEOs were asked to deliver this time, give us some hard facts. How soon before these companies would go under without some sort of federal help? Did they do that?
ISIDORE: Yeah, they gave a much more detailed amount that they needed. They actually came up asking for more money this time because they -- which in some ways made it easier for them in Congress because Congress thought rightly that they pulled the $25 billion figure out of the air two weeks ago.
WHITFIELD: Yeah, well now it's over 100.
ISIDORE: No, now it's $34 billion that they're asking for in the short-term.
WHITFIELD: And some additional things tacked on. I mean, that's a hard pill to swallow, is it not?
ISIDORE: Yeah, it is. They're not going to get that $34 billion right away. It looks like the tentative agreement reached in Congress last night will be closer to 14, $17 billion, but that will at least keep the companies operating through the end of March like Candy Crowley was talking about.
WHITFIELD: OK, so Chris, we're taking in a lot of e-mails. You know, people have some very strong views about the big three, about the American auto and about whether taxpayers should be helping out.
So our Josh, as usual, has been going through the e-mails and we're so glad folks are talking about this. But, what are they saying?
JOSH LEVS, CNN NEWS CORRESPONDENT: They're flying right in, we're grabbing them, throwing them right up on the touch screen, which is right behind me, and I'm not in the dark over here. There I go. Here I am.
Check this out, so we're just grabbing them, throwing them up here and Chris, I want to start off with this question for you. This come to us from Shaleen.
"What sorts of conditions are likely to be put on this bailout money? If we give them 18, 25, $34 billion can we at least demand that the automakers produce electric cars or cars with better gas mileage that we specify?
What's the answer to that one?
ISADORE: Well, the answer is that there will be a lot of more oversight than was originally being talked about. There will probably be someone with powers pretty close to what a bankruptcy judge would have to force creditors to accept less, to impose new contracts on unions if necessary, to cut some of the dealership ties that they can't afford anymore.
So, not only will there be oversight, but there will be some powers entailed which will help the automakers have the leverage they need to make the changes that they need. There will be some requirements of our fuel economy, truth be told. Electric cars are going to be very costly and are probably going to be money losers for five, six, seven years, eight years to come. That's not a way to return the companies to profitability. It will be good for the country...
(CROSSTALK)
LEVS: (INAUDIBLE) with gas mileage rules written in.
ISADORE: Even that is probably not going help profitability as much as it has help the national goals of foreign oil dependency and things like that, but the fact of the matter is those are not the profitable cars.
LEVS: Understood. Let me toss this next one at you, because a lot of people are not feeling very optimistic about this idea and I want to show you this question from Kevin who's in Pasadena who writes us: "If the recipients of the bailout money continue their downward spiral and the companies fail, what will the American people who bailed them out receive? i.e., some sort of collateral."
What collateral, will the American people -- if they're give them the tax dollars, have on these companies?
ISADORE: That's an excellent question. The quick answer is there will be some collateral, some real estate, some plain, some equipment that will back some of these loans. The value of what that collateral is, if the loans fail is of some question, though. We probably will lose money.
The fact is, though, that the economy is in such a fragile state right now that even if this loan right now only postpones the inevitable, even if it only postpones the failure for a year or two from now that might be a good bargain because the economy might be in better shape to take a failure a year or two than it is today.
LEVS: All right I want to toss one more at you before we go, because these questions are coming fast and furious, weekends@cnn.com. And this is rhetorical, but it's what people are asking. "Why doesn't the government just give us all a large amount of money and we can buy their cars and that should help the car companies out." What do think about that? Just tell a bunch of people to go buy cars -- Chris.
ISADORE: It would be awfully tough to structure such a package that would require you to buy cars from these three people and if we all go out and buy Hondas and Toyotas, which are made in the United States, as well, it will not help these guys at all.
LEVS: It's not feasible, it's just the kind of thing people say, because we all understand the frustration, you know, why is just the big guy...
WHITFIELD: Yeah, because people are saying, wait a minute, what about me? I need some help. LEVS: Yeah, that's what they're saying and they're realizing they're not getting a piece of this.
WHITFIELD: Right, all right, Josh, thanks so much. And Chris, I appreciate it, too. When we come back, Chris, you're stick with us throughout a good part of the hour, Josh as well. We're going to continue to field a lot of your e-mails.
And Chris, I want to ask you when we come back, if automakers were to file for bankruptcy, does that indeed help turn things around in the immediacy or does it simply give them an opportunity to reorganize? Does it help guarantee for a better company without the taxpayer support?
And we want to, again, emphasize, I want to take in your e-mails, too, on the issue.
All right, meantime, straight ahead, sending a holiday card to someone that you don't even know. Well, it's all the rage, even first lady Laura Bush is doing it.
(COMMERCIAL BREAK)
WHITFIELD: All right, time to take a peek outside. Reynolds Wolf is in the Weather Center with the bird's-eye view of the entire country for us.
REYNOLDS WOLF, CNN METEOROLOGIST: Yeah, but I mean, to get this kind of view you got to be one big bird flying really, really high.
WHITFIELD: You are one big bird.
WOLF: That's what we're talking about.
WHITFIELD: What are you, 6, what?
WOLF: About 6'4-1/2".
WHITFIELD: See, I call that a big bird.
WOLF: I know. Thank goodness for platform shoes.
(WEATHER REPORT)
WHITFIELD: All right, not bad. So, Reynolds do you and your family all send out holiday cards to the family and all that good stuff?
WOLF: We try to. We do that or either the postcard, you know, everybody all crowded together, maybe a couple of cats.
WHITFIELD: Oh, that's nice. How nostalgic. Well, everyone seems to be into it. Everyone including the first lady these days and you know what, it's not just for family and friends. The Red Cross with the first lady's help, sending out greeting cards, holiday cards to American troops around the world. So, all this taking place at the headquarters of the Red Cross today in Washington. The first lady, Laura Bush has volunteer to sort through thousands of letters and they will actually be delivered to troops, veterans and their families.
(BEGIN VIDEO CLIP)
LAURA BUSH, FIRST LADY: Thank you all for coming out, happy holidays and I want to thank all of the volunteers who are here behind me for volunteering. It was very sweet to sort and read these cards and see what Americans have written in to our troops. So thanks, everybody.
(END VIDEO CLIP)
WHITFIELD: How very nice. CNN's Kate Bolduan is at the Red Cross headquarters, and so lots of paper cuts, I imagine, in the room, but all for a very good cause.
KATE BOLDUAN, CNN NEWS CORRESPONDENT: Worthwhile paper cuts if there could ever be a worthwhile paper cut.
The sorting, the gathering and the screening continues here, Fredericka. These are some of the letters that you can see, that have come in to the Red Cross, that are going to be gone through, they're going to be sorted, they're going to be reviewed and they're going to go into their appropriate box to be sent out to service members, their families across the country and across the world. You see, all of the work continues. They've been dog all day, Fredericka and it seems that the piles never get smaller because they have a lot go through.
Now, these are some of the volunteers that we've been talking to this morning, I'm told about 175 people were here today. There are 16 sorting sites across the country that are going to be doing this. They're shooting for a total of a million, maybe more by the end of the year. So far, about 175,000 letters have come in, as we're told.
WHITFIELD: They have a long way to go, then.
BOLDUAN: They do have a long way to go, but they're hoping for a big push.
And let me introduce you to some very special volunteers that have been helping out, today. This is Lieutenant Colonel David Oclander and his son Matthew.
Matthew, you were telling me earlier that you took part in this helping send cards overseas when your father was overseas. Why did you do that?
MATTHEW OCLANDER, RED CROSS VOLUNTEER: Well, I mean, I thought it was special to do something like that for my dad. I mean, some of the cards I sorting could go to, at that time, my dad's brigade. They'd go to some people there, some people in another brigade and luckily, he didn't, but maybe even to my dad. So, it was just really special, and since my mom, my dad, my stepmom and my stepdad. They're all in the Army or just got out and so army has always been a family for me and so I think my family helps each other out, so I help out my Army family.
BOLDUAN: And David, you were telling me that you've missed a few holidays, now. What does it mean for you to not only have received some of these letters, but to see all of the effort that goes into it just to get a simple card out there to you.
LT COL DAVID OCLANDER, RED CROSS VOLUNTEER: Well, you know, just like Matt said, in the military we're very tight. We're a tight-knit community and we do a lot for each other, but to come out here and see so many cards from all across the country from so many different people, young, old, it's just inspiring and it's humbling to know that people appreciate our service and that's what being in the military is all about these days, it's about serving our nation and about serving every individual that we can.
BOLDUAN: And I think it's important to point out, Fredericka, that this is just a brief stop for Lieutenant Colonel David. He's now heading back in July, I'm told, to continue serving. So you can see a lot going into this holiday season.
WHITFIELD: Wow, certainly a lot of love in that room, and I so admire Matt for all of his patches and badges there. He's quite the Boy Scout, there.
BOLDUAN: An Eagle Scout, get it right, Fredericka.
WHITFIELD: Oh, Eagle Scout. Let me get it right. OK. Well, I love all those scouts. All right. Great job, thanks so much, Kate. Appreciate it.
All right, well a front page plea, easy for me to say, to Washington, delivered to every senator and representative. We'll talk to the editor of the "Detroit Free Press." You're not going to believe what they said.
(COMMERCIAL BREAK)
WHITFIELD: A quick look at what's happening right now. There appears to be a growing consensus in Washington about an agreement to help the struggling U.S. auto industry. White House staffers and Congressional Democrats are working on a compromise that could provide about $15 billion in loans. And President-Elect Obama says he's working on an economic stimulus plan designed to save or create 2.5 million jobs. He offered a broad outline of his economic plans during his weekly radio and Internet address.
So, high gas prices, a recession, now the threat of bankruptcy for the big three automakers? So, how can you possibly convince people to buy a car these days, particularly American-made?
Well, CNN's Alina Cho reports on what one desperate Dodge dealer is trying.
(BEGIN VIDEOTAPE) ALI AHMED, ROB LAMBDIN'S UNIVERSITY DODGE: The first thing people think when they come in is that, yes, it's a fake ad, it's a normal car dealer ad, it's a gimmick, but it's not.
ALINA CHO, CNN CORRESPONDENT (voice-over): Buy one, get one free. The type of ad you normally see at a grocery store, but at a Dodge dealership in Miami?
AHMED: We've been fielding phone calls and e-mail increase from every state in the country looking to get this buy one, get one deal.
CHO: Desperate times, desperate measures. This year, 700 car dealers shut their doors. That number is expected to top 900 by the end of the year and the majority of those dealers sell American cars.
AHMED: It's definitely a tough climate right new. A lot of people are saying it's a perfect storm of gas prices and financing and consumer confidence.
CHO: The biggest problem: the trickledown effect of the credit crunch. Can't get a loan, can't buy a car. This Chrysler dealership in New York used to sell 150 cars a month. Today, they say it's half that.
(on camera): A year ago, you might have had 15 to 20 salesmen on the floor. Today, it's what?
MATT LEE, FLOOR MANAGER, MAJOR WORLD AUTO: Eight to 10. Salesmen actually just walked out because they're not making enough money to support their family.
CHO (voice-over): They've even stopped bringing in new models because the cars they have aren't moving.
JAMIE KRINSKY, SALESMAN, MAJOR WORLD AUTO: Just, you know, where you would see five people a day coming in to at least to look at a car per salesmen, you're getting maybe one person a day or two people a day.
CHO: So, they're offering deals, too.
(on camera): Tire package included.
(voice-over): Zero percent financing for 72 months, $7,500 rebates. Even that's not enough. In the two hours we spent combing the lot, only one customer who was just browsing. So, could a buy one, get one free offer help this dealership?
(on camera): You have to admit, it's pretty catchy.
LEE: If it worked for them, what can we doo? Maybe we'll try it?
CHO: In the interest of full disclosure, we should tell you the buy one, get one free means buy the first Dodge truck at full retail, get the second one free excluding tax, tags and dealer fees. That will cost you about $3,000, still a good deal, but as always, there's a catch.
Alina Cho, CNN, New York.
(END VIDEOTAPE)
WHITFIELD: All right, still more talk on the U.S. auto industry. Just take a look at Friday's "Detroit Free Press." The paper made a front page plea to Washington with a simple message, "invest in America." Copies of the paper were actually delivered to every U.S. senator and representative.
Earlier, I said you wouldn't believe what it says because usually -- Paul Anger is the paper's editor -- usually, Paul, a newspaper tries to stay away from a front-page editorial, but you all felt like this was vitally important to do so, why?
PAUL ANGER, V.P. & EDITOR, DETROIT FREE PRESS: Well, we -- a newspaper needs to inform, but sometimes a newspaper needs to take a stand. Just stand up and say what's right. This is the way we see it and we thought there was so much misinformation across the country, so much misperception in Congress as well that we had to stand up and say we know the car industry. We cover it every day, we know it better than anybody else. This is the message that America and every member of Congress needs to have.
WHITFIELD: OK, and before I ask you to elaborate on that misinformation that you all wanted to clarify as a newspaper, your front page, "invest in America" and then it goes on to say, quote, that "you don't want an economic disaster on your hands. Not when you could have prevented it." This message to Congress. So, is it paper, is the industry say that if the auto industry fails, it's a result of the government's fault?
ANGER: Well, I don't think it's ...
WHITFIELD: Or the government's doing or lack of effort?
ANGER: Yes, I mean -- well, the government right now has a choice to make. The government can give a loan to the U.S. carmakers. The government has already given a bailout, a giveaway, a handout to all the financial institutions that got us into this mess.
Now, the government has a choice to make and the choice is are we going give a loan to the U.S. carmakers, who are the crux of the economy across the country, they're into the fabric of all kinds of businesses, including Main Street on every small town in this country. Millions of jobs at stake, so is Congress going to turn its back?
WHITFIELD: Millions of jobs at stake, but at the same time there are a lot of Americans who are arguing, OK, this handful of money is handed over to the auto industry to help resuscitate it temporarily, but it doesn't necessarily guarantee that this is a company or these Big Threes will be able to survive long term. And so, this might be just a temporary fix if a fix at all.
ANGER: Well, I think you have to take it one step at a time. First of all, the car companies are on the right track. They've -- they're paying for sins that they committed over decades, poor cars and there's a litany of things that they did wrong. Actually, they're on the right track now. The cars are better, the products are high quality, the plant efficiency is up there. They're competing very well.
WHITFIELD: So, does that mean that there's a problem in the management of these companies? I mean, why aren't people either buying enough American cars or why is it that these Big Threes are losing so much money? Or is it both?
ANGER: I think -- well, I think the Big Three is paying for the sins of the past, honestly, to a large extent. The Ford Fusion was on the cover of "Consumer Reports," the Chevrolet Malibu got the highest initial quality ratings from J.D. Power, an independent survey group.
So, the product is getting there. The fuel efficiency is getting there. They have some exciting products in the pipeline, but they're still paying for people -- they're still paying in people's minds for products in the '80s and '90s that really were not very good. So, they've got some legacy issues to get past and they have to take their pound of flesh for that.
WHITFIELD: So, where's the misinformation? Because it wasn't that long ago that Lee Iacocca said you know what, government, I need some help and the government provided some assistance, but now here we are, decades later with a very similar problem.
ANGER: Well, decades have passed and in 1979 when Lee Iacocca wanted $1.5 billion and the government did give him a loan, the Chrysler Corporation was able to repay it and more back to the American taxpayer. Now, we're at the point where another loan really, truly is in order and it need -- the carmakers are on the right track. They need this to get to the future. There was no guarantee about anything. There's no guarantee that the money that was --
WHITFIELD: And isn't -- and, you know, isn't that what survival of the fittest is all about and that applies to free enterprise as well. The company doesn't do well, if management doesn't make the right kind of decisions, if you don't have the right product ...
ANGER: Sure.
WHITFIELD: ...if all that fails, then so goes the company.
ANGER: Well, sure, but what you have right now is three U.S. carmakers that are directly influencing jobs across the country on Main Street and we're not just talking about jobs that are directly tied to the auto industry.
WHITFIELD: OK.
ANGER: We're talking about the barbershop, the diner ...
WHITFIELD: Yes.
ANGER: ...and all of the businesses that depend on the economy that these companies generate.
WHITFIELD: OK. And Paul Anger, editor of the "Detroit Free Press," certainly nobody wants to see American jobs go away. Nobody wants to see anybody else lose jobs, but at this juncture, it seems as though a lot of people are asking the question of who helps pay for a company or, in this case, three companies that aren't doing well.
And these are the questions we're asking a lot of our e-mail -- our viewers. They're e-mailing some responses. Hopefully, you can stick around, too, to listen to what a lot of viewers are saying via e-mail that we're putting right on the air.
Paul Anger, I appreciate your time. Thanks so much.
ANGER: Thank you.
WHITFIELD: All right. O.J. Simpson, well, he had plenty to say before a judge sentenced him. Did he help or hurt his case? Our legal guys are right there and they cannot wait to get into this case.
(COMMERCIAL BREAK)
WHITFIELD: All right, O.J. Simpson headed to prison for at least nine years. The former football great was given a complicated sentence for the robbery of two sports memorabilia dealers in Las Vegas. It could add up to a maximum of 33 years. It's too late now, but a Nevada prosecutor says that Simpson could have taken a plea deal for less time. Bottom line, it will be nine years before he's eligible for parole. Simpson's attorneys say they will appeal.
So, let's ask our legal experts. Avery Friedman, civil rights attorney and law professor. Good to see you.
AVERY FRIEDMAN, CIVIL RIGHTS ATTORNEY: Hi, Fredricka.
WHITFIELD: Coming to us from Cleveland, right?
FRIEDMAN: Yes.
WHITFIELD: And Richard Herman is a New York criminal defense attorney and law professor. Good to see you as well from New York.
RICHARD HERMAN, CRIMINAL DEFENSE ATTORNEY: Hi, Fred.
WHITFIELD: OK, guys, Simpson spoke very apologetically, however, the judge said, you know what? Too late. Richard, was this a tough sentence or was this apropos?
HERMAN: Well, according to Simpson's own lawyer, this was a very fair sentence. I mean, the judge could have sentenced him to life in prison. But I have to tell you, Fred, I've seen many defendants and I've counseled defendants in making pleas at time of sentencing.
I'm telling you, I'm not a fan of O.J., but I've got to tell you, his was a fantastic plea to the judge. I thought it was forthright. I thought it was honest, and I really, based on that, I would have given serious consideration to putting him on the stand during the course of the trial. I really thought ...
WHITFIELD: Well, I was wondering about that. So wait a minute, here he did this, he made this very heartfelt, what seemed to be a heartfelt plea, but it didn't happen during the trial. Mistake?
HERMAN: Well, you know, in retrospect, Monday morning quarterbacking ...
WHITFIELD: Yes.
HERMAN: ...I think it was a mistake because I think he's a very powerful orator, and I think he could have swayed a few of those jurors in this case.
FRIEDMAN: Oh, I don't know.
WHITFIELD: So Avery, you know, this judge said -- remember, early on, she said, I don't know if you're arrogant or ignorant and now, she said yesterday, even after hearing him ...
FRIEDMAN: Yes.
WHITFIELD: ...I think you're both.
FRIEDMAN: Yes.
WHITFIELD: Was this kind of personal or ...
HERMAN: Yes.
WHITFIELD: ...you know, was this the appropriate sentence or even judgment?
FRIEDMAN: Well, actually, Judge Judy Glass has been very thoughtful in the whole approach. I actually think that what she had to say was a proper and thoughtful thing to say. Remember, before that, Fredricka, what she said was look it, everyone is thinking that what's going into the deliberation is what happened 13 years ago and it was not.
So, here's someone who presided over the trial. There was a manifestation of arrogance. There was a manifestation of ignorance. I think what she did was conservative. I think it's bulletproof. I don't look for a reversal on the sentencing.
WHITFIELD: Oh, OK.
HERMAN: Fred, I disagree with Avery on this. At a minimum ...
WHITFIELD: You see a reversal.
HERMAN: At a minimum, the nine years is going to be reduced to six because this judge sentenced him both on armed robbery and on armed assault.
FRIEDMAN: That's right, that's right. HERMAN: Separately. That's three years that are going to be reduced. She made a mistake with that. But ...
WHITFIELD: OK. So, he's 61 now, maybe 67 when he gets out.
HERMAN: Yes, but you know, Fred, I believe ...
FRIEDMAN: Yes, I bet.
HERMAN: I believe there's a lot of people in Las Vegas, the prosecution, the jurors and the judge wearing "I finally got O.J." pins. I really do.
FRIEDMAN: What? Oh, my goodness!
HERMAN: The -- the case thirteen years ago ...
WHITFIELD: Well, didn't -- yes, and -- it was to the day that the sentence came down, or that the conviction came down.
FRIEDMAN: Yes, yes, look it, this was probably one of the most unpopular guys in America.
WHITFIELD: Yes.
FRIEDMAN: But to suggest that ...
HERMAN: It affected the case.
FRIEDMAN: ...Judge Glass -- that Judge Glass factored that into the equation I think is unfair.
WHITFIELD: Yes, OK.
FRIEDMAN: And I think the appeal issue will have nothing to do with the sentencing.
HERMAN: Hey, Fred, what ...
WHITFIELD: OK, and quickly -- oh yes, go ahead.
HERMAN: Just one quick ...
WHITFIELD: Quick.
HERMAN: One further comment the judge made in all the criminal trials she's done, she's rarely seen all the crimes on videotape. And that's what happened here. It was an insurmountable mountain.
WHITFIELD: Wow.
FRIEDMAN: Oh, the videotape was overwhelming. Yes, absolutely.
WHITFIELD: OK, all right, well, I was going to switch subjects, but now I guess we do have a little bit more time on this one.
FRIEDMAN: All right.
WHITFIELD: But you know what, his attorneys, well, maybe they'll appeal ...
FRIEDMAN: You got two grounds, Fredricka.
WHITFIELD: Yes, what would be the argument?
FRIEDMAN: Yes, No. 1, Yale Galanter and the defense team are saying No. 1, they weren't given an opportunity to properly voir dire, to ask potential jurors questions of how they felt about O.J. before and also, the exclusion of minority jurors. I think those are legitimate issues for appeal, I just don't think it's going to stand up.
WHITFIELD: Oh. All right, last words, Richard?
HERMAN: Well, I agree that those are legitimate issues on appeal, as well as the sentencing error by the judge. He's going to get some wins on the appeal, but he's going away in prison for at least six years, probably nine and that's a long time for a man 61- years-old.
FRIEDMAN: That's right.
WHITFIELD: And it -- yes, and it won't be a case of you appeal and you get a chance to still be at home.
HERMAN: No.
FRIEDMAN: Not here.
WHITFIELD: Instead, his appeal will take place while he is in jail.
FRIEDMAN: That was the first motion.
WHITFIELD: Ouch.
FRIEDMAN: Can we have bond? No, you're in the slammer.
WHITFIELD: Yes. All right, Avery, Richard, thanks so much. Always good to see you.
FRIEDMAN: All right. Good to see you.
HERMAN: Hey Fred, keep pushing those automakers, Fred. Keep pushing them.
FRIEDMAN: Well, that's right!
WHITFIELD: Well, there are lots of questions I think a lot of people have ...
FRIEDMAN: Those were great questions.
HERMAN: Yes.
WHITFIELD: ...and it's really at the interest of everyone because if it's taxpayers' money that's paying for it ...
FRIEDMAN: Exactly right.
WHITFIELD: ...then I guess don't we all have a right to ask a lot of questions, which is why we're getting a lot of e-mails.
FRIEDMAN: Which is what you did, right.
HERMAN: Keep pressing that, Fred.
WHITFIELD: Lots of e-mails, so we continue to get them on the air.
HERMAN: You're doing a great job. Keep it up.
WHITFIELD: Thanks so much, guys. Appreciate it.
FRIEDMAN: Take care.
WHITFIELD: You'll are kind. Thank you.
All right, well, if you still want to learn a little bit more about the O.J. Simpson case and you want to hear exactly what he did have to say in court, watch the 4:00 p.m. hour. We're going to air the entire statement in the NEWSROOM, 4:00 Eastern time. You don't want to miss that.
All right, well, you asked us the questions about plans for an auto bailout and we actually have a few answers for you, too, coming up.
(COMMERCIAL BREAK)
WHITFIELD: All right, so the Big Three U.S. automakers, they can file for bankruptcy, right? Buy a little time with their creditors, perhaps take a little time to reorganize?
Chris Isidore covers the auto industry for CNNmoney.com. So, why don't they?
CHRIS ISIDORE, CNNMONEY.COM: Well, there are a couple of quick reasons. One is companies that are able to reorganize in bankruptcy get financing from lenders to operate during bankruptcy process. That's almost certainly not available to these automakers given the state of the credit markets and the state of the automakers themselves.
WHITFIELD: All right, so ...
ISIDORE: Secondly, many people won't buy cars from a bankrupt automaker.
WHITFIELD: All right, so last-ditch effort, say the Big Three. This is why they're now turning to the U.S. government and we've been taking in so many e-mails, Chris. Josh Levs has been going through all of them and they also have some questions in addition to those comments being made.
JOSH LEVS, CNN CORRESPONDENT: Yes, it is. It's really interesting stuff. They're sending us these questions, we're going to toss them to Chris, get some answers for you.
In fact, Chris, let me start with this, touches on the same idea as bankruptcy you guys were just talking about. Let's zoom in. Well, "What happened to the employees' pensions and 401(k)s if the auto companies were to file bankruptcy?" That's from Dave Rowland, Cooper City, Florida. A lot of people asking similar questions. What would happen to those pensions and 401(k)s?
ISIDORE: The pension funds are not in bad shape. But if the government takes them over, a lot of people who retired at age 55, 56, 58 could potentially see their benefits cut dramatically because the government pension guarantees do not pay early retirement the way the automakers do.
LEVS: OK, so they could be hurt, interesting.
I also want to ask you another one. This is my favorite ones we got. "On treadmill so make this quick. Newsweek article maybe they should all merge into a big one. Good idea?" And what he's referring to is this "Newsweek" article right here that discusses the idea and it suggests, and then there was one, distilling the Big Three into a single player could save Detroit. What do you think about that, Chris, would merging save them?
ISIDORE: It's certainly possible. I don't think many people think that there will be three U.S. automakers when everything shakes out, either Chrysler will end up with a foreign automaker once again or it might end up with GM or Ford at some point down the road. But it's awfully tough to pull off that kind of deal under the gun the way the automakers are right now. This buys them time to find the best marriage.
LEVS: Interesting. All right, let me get in one more since we got a little time. Let's zoom back in on the board here. This is from the other side, I hadn't thought about this. This says, "I just purchased a new GM car. I'm worried if GM fails, what will happen with my warranty and extended warranty?" That's from Michael Yanoff, Chicago, Illinois. Great question. Chris, what happens there?
WHITFIELD: And parts?
ISIDORE: This is an answer to Fredricka's question. This is why bankruptcy doesn't work. People won't buy a car because even if you tell them that someone else is backing the warranty, they won't believe it, they'll be nervous. They'll also be nervous about the resale value of the car. If an automaker is going out of business, the resale value will be hurt. You just cannot make bankruptcy work for the automakers the way you can for an airline or a steel company.
LEVS: So, when you look at it from his perspective, in fact, he would be in trouble if that were to happen?
ISIDORE: Potentially.
LEVS: Yes.
ISIDORE: It depends on how the bankruptcy works out and he ends up basically as a creditor of sorts which you don't want to be in a bankruptcy.
LEVS: Well, Chris, thanks for that. And Fred, you have great questions.
WHITFIELD: Yes, and Chris, do you worry about the next industry? There isn't as big of an industry, American-made industry as the auto industry right now, but do you worry about what's next? Who's going to need some money next?
ISIDORE: Well, the fact is is that if the auto industry goes, there will be a lot of other industries hurt. The suppliers will be -- could be wiped out. The largest purchaser of steel, of microchips, of plastics, of aluminum. There's going to be widespread additional pain if the automakers go away.
WHITFIELD: Wow. Chris Isidore with CNNmoney.com, thanks so much for your insight. And of course, Josh, appreciate it to you as well and to you viewers who've been sending some pretty riveting e-mails, questions, questions, comments, all of that, we appreciate that. And of course, we want to continue to field more.
Well, perhaps you are looking for work. A desperate job seeker finds a creative way to actually separate himself from the pack.
(COMMERCIAL BREAK)
WHITFIELD: All right, desperate times call for desperate measures. One unemployed man is taking his plea for a job to the streets of New York, literally.
CNN's Richard Roth caught up with him.
(BEGIN VIDEOTAPE)
RICHARD ROTH, CNN SR. U.N. CORRESPONDENT (voice-over): He looks like a typical commuter wearing a suit and tie in the crowds of workers pouring into Manhattan. Paul Nawrocki doesn't have to go far to get to his office. It's right on the corner. His job, these days, is to look for a job and he's making sure people know he is available by wearing this large advertising board.
PAUL NAWROCKI, LOOKING FOR WORK: What I was doing wasn't working. When you're doing something and it doesn't work, you have to do something different.
ROTH: Nawrocki worked in the toy industry in operations for 36 years. He was laid off in February shortly before his company went bankrupt. NAWROCKI: My daughter said to me, she said you know, you should take some resumes and hand them out on the street.
ROTH: Paul's unemployment insurance will soon run out. His wife is partially disabled and his daughter has student loans.
(on camera): How humiliating is it for you right now walking on the streets of Manhattan with a sign like this?
NAWROCKI: When you're out of work and you face having nothing, I mean having no income, you're -- there is -- pride doesn't mean anything. You need to find work. I have to take care of my family.
ROTH (voice-over): Nawrocki stands in the cold for hours. New Yorkers, used to the homeless and sidewalk pitchmen look, but don't often stop.
UNIDENTIFIED FEMALE: I feel sorry for him. I wish I could help him.
ROTH: A passerby offers a suggestion to try down the street at the United Nations, and he becomes a photo-op for international media.
At Paul's favorite corners, some competition from charity groups and then from a young man searching for a girl he liked whose phone number his roommate threw away.
There was one hopeful moment.
UNIDENTIFIED MALE: I'm a head of an executive search firm in New York, so why don't you give me your resume ...
ROTH: Nawrocki takes a break in a nearby park to check e-mails.
NAWROCKI: Nothing so far. A lot of junk mail.
ROTH: It's a sign of the times.
Richard Roth, CNN, New York.
(END VIDEOTAPE)
WHITFIELD: And it's a sad sign of the times and this programming note, we're going to talk a little bit more about the job scene, what to do with your money, perhaps as your employer showed you the door, maybe they gave you a lump sum or maybe you need some help on stretching your pennies or your dollars.
Today during the 3:00 p.m. Eastern hour, we're taking your questions and your comments and we've got experts here as well. E- mail us at weekends@CNN.com and we'll try to get some of those answers for you. So, you don't want to miss the 3:00 p.m. Eastern hour.
Meantime, "YOUR MONEY" starts right now.
