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Obama Nominates Shinseki to VA; Rising Credit Card Fees
Aired December 07, 2008 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
NAAMUA DELANEY, CNN ANCHOR: Straight ahead, Barack Obama says the war doesn't end when the troops come home. He selects his man to head Veterans Affairs.
A tough economy. Now you're hit with higher fees. What is going on with credit cards?
And millions head to Mecca. Our Arwa Damon joins a hajj pilgrimage.
Hello, I'm Naamua Delaney and you are in the NEWSROOM.
President-elect Obama used Pearl Harbor Day to announce his choice for secretary of Veterans Affairs. Army General Eric Shinseki is a decorated Vietnam War veteran. He retired after disagreeing with the Bush administration over how many troops would be needed for the war in Iraq.
Elaine Quijano and Bill Schneider are standing by with details and analysis. So let's start with Elaine covering the Obama transition team in Chicago.
Hello, Elaine. What do we hear today?
ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: Hello to you, Naamua.
Well, as you said, earlier today in a news conference here in Chicago held on Pearl Harbor Day, President-elect Barack Obama announced his pick for Veterans Affairs secretary, Retired General Eric Shinseki.
Now Shinseki, Obama noted, like himself grew up in Hawaii and the president-elect said he understands certainly the significance of that event. The bombing of Pearl Harbor. Shinseki, himself, of course, is perhaps best known for comments he made back in 2003 when, as army chief of staff, he testified before the Senate Armed Services Committee and said that something on the order of several hundred thousand troops would be needed in Iraq in order to pacify that country.
Well, those comments did not sit well with the Bush administration especially then Defense Secretary Donald Rumsfeld and Shinseki himself retired just a few moments after those comments.
Today, in his news conference, the president-elect alluded to those remarks and the controversy that they generated.
(BEGIN VIDEO CLIP) SEN. BARACK OBAMA (D), PRESIDENT-ELECT: And there is no one more distinguished, more determined, or more qualified to build this VA than the leader I'm announcing as our next secretary of veterans affairs, General Eric Shinseki.
No one will ever doubt that this former army chief of staff has the courage to stand up for our troops and our veterans. No one will ever question whether he will fight hard enough to make sure they have the support that they need.
(END VIDEO CLIP)
QUIJANO: Now General Shinseki is a highly decorated Vietnam veteran. He served two combat tours and lost part of his right foot. President-elect Barack Obama says that General Shinseki understands the needs of the troops and their families -- Naamua?
DELANEY: Obama, of course, talking about why he nominated...
(BEGIN VIDEO CLIP)
OBAMA: To allow the auto industry in the United States to collapse, precisely at a time when we're already seeing record joblessness is unacceptable. What I've also said is that it makes no sense for us to shovel more money into the problem if you have not seen an auto industry that is committed to restructuring. Restructuring that, frankly, should have been done 10 years ago, 20 years ago, 30 years ago.
And so Congress did the right thing when it rejected a plea for funds without a plan two weeks ago. The automakers have come forward and put a more serious plan on the table.
(END VIDEO CLIP)
QUIJANO: And Naamua, what we heard right there is another part of the news conference in which, of course, the economy and specifically the plight of the big three U.S. automakers was at issue as lawmakers in Washington try to hash out some kind of solution to make sure that the big three can stay afloat.
President-elect Obama, you heard him there just a moment ago, saying that Congress did the right thing by asking for, essentially, a condition-based assistant -- assistance package, one that, as he put it, holds the auto industry's feet to the fire giving them some short- term help but also, Naamua, insisting that those big three automakers make some tough business decisions -- Naamua?
DELANEY: Right. He sounded very disappointed by their first appearance on Capitol Hill when he felt that they didn't really have an adequate plan.
Elaine, thank you very much for joining us live from Chicago.
QUIJANO: Sure. DELANEY: Well, more now on President-elect Obama and the big three bailout loans. CNN senior political analyst Bill Schneider is joining us from Washington.
So, Bill, this is very interesting to watch just now. Obama announced a new member of his Cabinet yet the first question out of the gate by reporters was about the auto bailout. So why is there so much resistance from basically everyone?
WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Because people think that they're paying off a lot of business people, big business people who handle their -- who manage their businesses very poorly.
A lot of people are angry at the auto companies. They think they've been mismanaged. More and more Americans have been driving cars made overseas. They think if the auto industry is in big trouble, a lot of it has to do with the fault of business and that the government should not be in the business of bailing them out.
DELANEY: And Obama also talked about his jobs program. He said that that has bipartisan support. How come? That seems very unusual?
SCHNEIDER: It's interesting. We have had two bailout plans. One for Wall Street. Now there's one on the table. Congress may vote on this week for the auto industry. And third, not a bailout plan but a big jobs program. Also hugely expensive.
Now the Wall Street rescue plan met with a lot of public resistance. The first time it went up for a vote, it failed. People didn't like the idea of bailing out Wall Street for the same reason they don't like the idea of bailing out Detroit.
It's paying off big business when governments should be helping ordinary Americans who are having trouble keeping their jobs and meeting their mortgages. The Wall Street bailout was unpopular because very few people know much about workers on Wall Street.
They do have some sympathy for workers in Detroit, for automobile workers, not just Detroit but all over the country, and they really do want a jobs program.
The key word here is jobs. When Obama promises a multi -- many millions of dollars spent to create or save 2.5 million jobs, there's a lot of support for that, and Republicans aren't even opposing it very much. It's really bipartisan, but when it comes to rescuing big business, not so much.
DELANEY: Yes, jobs only considered that almost 2 million jobs have been lost in the U.S. this year.
SCHNEIDER: Yes.
DELANEY: I mean, obviously, foremost on people's minds.
All right. Let's go to the political drama in Louisiana. Nine-time Democratic representative William Jefferson out. Joseph Cao, the man who'll be the first Vietnamese American is in.
How surprising was that outcome?
SCHNEIDER: Well, a lot of people expected Jefferson to win because he won in 2006 after the charges came out and he was caught with $90,000 stuffed in his freezer. His constituents rescued him on that occasion but this time it was a special election. Probably they had enough. There were stories coming out about how his family, not just the congressman himself, have profited on the deal.
There was some exasperation and embarrassment, I should say. And even with the heavily African-American district, turnout was very light in about 15 percent of African-American voters in that district voted for the Republican.
So it looks like, basically, the voters said enough is enough.
DELANEY: All right, Bill. Well, thank you very much for all that analysis.
That's Bill Schneider joining us live.
Well, one of the key senators in the big three rescue negotiations wants GM to replace its CEO. Senate banking chairman Christopher Dodd say it's time for car CEO Rick Wagoner to move on. He made the comment as Congress and the White House continue to work on a possible loan package.
CNN's Kate Bolduan has the details.
(BEGIN VIDEOTAPE)
KATE BOLDUAN, CNN CORRESPONDENT (voice over): After weeks of deadlock over Detroit, Democratic leaders are calling Congress back to try to hammer out a deal and offer ailing automakers a life line.
SEN. CARL LEVIN (D), MICHIGAN: Last month we lost, what, 500,000 jobs in this country. So the economic impact would be terrible if any of the big three go under, and there's that recognition, I think, that is growing across the country and here in Washington.
BOLDUAN: Friday, Democratic leaders reluctantly agreed to allow money from an existing loan program meant to help automakers produce fuel- efficient vehicles be used to fund the emergency loan, a plan the White House is pushing.
Staff worked through the weekend to prepare a rescue package. Sources tell CNN it could total between $15 billion and $17 billion to help the carmakers survive through March, a much smaller amount than the big three's request of $34 billion.
Lawmakers say the loan will come with a price -- restructuring and oversight.
SEN. CHRIS DODD (D), BANKING CHAIRMAN: I'm not for giving these companies any money at all short of real commitments to restructuring and reorganization, and putting someone like a czar or a board with real power to make decisions.
BOLDUAN: Senate banking committee chairman, Chris Dodd, says one condition should be a change in leadership.
DODD: If you're going to really restructure this, you're going to bring in a new team to do this, in my view.
UNIDENTIFIED MALE: So what you're saying about GM is that Rick Wagoner, the chairman, has to go.
DODD: I think he has to move on.
BOLDUAN: Despite growing consensus among Democratic members of Congress, Republicans with the power to block the bill remain divided. Some, like Alabama senator Richard Shelby, continue to oppose a bailout saying bankruptcy is the better option.
SEN. RICHARD SHELBY (R), ALABAMA: This has been 30 years in the making. This so-called bridge loan to nowhere was -- will be the first down payment of many.
BOLDUAN (on camera): Democratic leader (INAUDIBLE) says the goal is to finalize the auto rescue package to vote by the middle of the week, but it remains unclear if they have the votes and the support to pass it.
Kate Bolduan, CNN, Washington.
(END VIDEOTAPE)
DELANEY: Well, do you have questions about the auto bailout loan and what could it mean to you, do send us your e-mail. The address, weekends@CNN.com. We will answer them in the 5:00 p.m. hour of NEWSROOM.
Well, as you just heard from Bill Schneider, history made in Louisiana. Voters boot out an indicted nine-term congressman and elect the first Vietnamese American to Congress. Little known Republican Anh Joseph Cao defeated Democrat William Jefferson. Jefferson is facing bribery and money laundering charges.
Cao spoke to our Betty Nguyen earlier today.
(BEGIN VIDEOTAPE)
ANH JOSEPH CAO (R), LOUISIANA CONG.-ELECT: I had just the tremendous outpouring of generosity, tremendous outpouring of motivation from people of the second district. So when we were approaching the last days of the campaign, we were pretty confident that we were going to win.
BETTY NGUYEN, CNN ANCHOR: Let's look at the timeline here, because had this election not been postponed because of Hurricane Gustav it would have been on the presidential Election Day which means you would have had a higher voter turnout in a district where, what, two out of every three voters is a registered Democrat. Do you think that this win maybe could be chalked up to the fact that it was a low voter turnout during the election last night?
CAO: That, that is correct. We were hoping for a low turnout because it would provide us with the greater chance of winning.
NGUYEN: You know I don't think I have ever heard that before, politicians saying we were hoping for a low voter turnout, but it did work to your advantage this time.
CAO: That -- you know, that is correct because based on the demographics of the district, a high voters' turnout would have gone to our disadvantage.
NGUYEN: Mm-hmm. You know you're virtually an unknown on a political scene. So when people are looking at you today, really getting a good look at you and your positions, what do you want to tell them about where you stand? What kind of politician you're going to be?
CAO: Well, you know, I hope to be a politician who will be able to work with people, to go across party lines, to sit down and discuss the needs of the nation and the needs of the second congressional district.
You know, I'm -- I'm not a hard core conservative, nor am I a left- wing liberal. I'm more very pragmatic. You know Aristotle used to say virtue is the means to -- between two extreme and I hope to go down, go down that line.
(END VIDEOTAPE)
DELANEY: Well, Cao is an attorney and community organizer. He won the congressional seat with about 50 percent of the vote.
And young people on a rampage. Cars torched, buildings burned, and demonstrations in the streets across Greece. The police shooting that started the violence.
(COMMERCIAL BREAK)
DELANEY: Rising tensions between India and Pakistan. Secretary of State Condoleezza Rice says Pakistan must act against extremists involved in the Mumbai attacks.
Our Kathleen Koch is in Washington with the latest.
(BEGIN VIDEOTAPE)
KATHLEEN KOCH, CNN CORRESPONDENT (voice over): As authorities piece together what happened in Mumbai, Secretary of State Condoleezza Rice, fresh back from the region, says there's evidence Pakistan was the staging ground.
CONDOLEEZZA RICE, SECRETARY OF STATE: I think there's no doubt that Pakistani territory was used by probably non-state actors. I don't think that there is compelling evidence of involvement of the Pakistani officials, but I do think that Pakistan has a responsibility to act. And it doesn't matter that they are non-state actors.
KOCH: Rice also cautioned India not to strike back despite frustration and anger over the attacks.
RICE: It felt a little bit to me like the United States post 9/11. I certainly understand that. But in this case, there are actions that India could take that could make the situation worse.
KOCH: The Bush administration is about to pass on to the Obama transition team a review offering new strategies in the fight against terrorists in Pakistan and Afghanistan. The "New York Times" reports one option requiring the Pakistani military be reconfigured to better fight militants before it receives U.S. aid.
National Security Council spokesman, Gordon Johndroe wouldn't give details, only saying the White House is concluding the review and will, quote, "pass it on to new teams since most policy adaptations would take place on their watch."
President-elect Barack Obama says he backs an approach that brings all the countries together.
OBAMA: We need a strategic partnership with all the parties in the region. Pakistan and India and the Afghan government to stamp out the kind of militant, violent, terrorist extremists that have set up base camps and that are operating in ways that threaten the security of everybody in the international community.
KOCH: As to whether India can pursue suspected terrorists into Pakistan, Obama would only say a country that's attacked has the right to defend itself.
(END VIDEOTAPE)
KOCH: And Secretary Rice denies reports that the U.S. has given Pakistan 48 hours to make arrests in the case. She did say, though, repeatedly in her Sunday interviews that the U.S. was waiting for Pakistan to act and soon -- Naamua?
DELANEY: Kathleen, what about in Pakistan itself where we know that there's been more trouble? Militants have been torching dozens of Humvees destined for U.S. and Allied forces in Afghanistan.
Did Secretary Rice say whether the U.S. was worried about that?
KOCH: Naamua, she was not asked about that, but the attacks certainly does raise concerns here in the United States that insurgents might be trying to choke off that vital supply line through the Khyber Pass where most of the supplies for western forces pass through.
And it certainly does create doubts about the level of cooperation that the U.S. and India can expect from Pakistani authorities who are vowing that they're going to crack down on terrorists.
DELANEY: All right, Kathleen Koch, joining us live from Washington. Thank you very much. KOCH: You bet.
DELANEY: And Senator John McCain giving a word of warning about challenges ahead for U.S. troops in Afghanistan. During a visit there today, McCain said the crackdown on Taliban militants will get harder before it gets easier.
About 3,000 more U.S. forces will be sent to Afghanistan next month. Military commanders are asking for about 20,000 more troops.
Several Greek cities are being whopped by a second day of violent protest. The U.S. and British embassies are warning their workers and tourists to avoid downtown Athens and other areas.
(BEGIN VIDEOTAPE)
DELANEY (voice over): It's the worse outbreak of violence Greece has seen in nearly 20 years. Dozens of youth throwing fire bombs and rocks in Athens's Thessaloniki and other towns. The police responding with teargas, but unable to prevent a rampage by protesters, most of them teenagers and young men.
The violence erupted late Saturday night after police in Athens shot and killed a 16-year-old boy. The police say a group of teenagers started throwing stones at a patrol car. Two officers confronted the youth but when they were attacked again responded by firing shots that killed one of the teens.
Rioting continued throughout the night. Dozens of shops and businesses were damaged. Early Sunday the government called for a restraint.
PROKOPIS PAVLOPOULOS, GREEK INTERIOR MINISTER (Through translator): I say this in light of the demonstrations that will happen and which can and should be done because it's everyone's inherent rights to protests, defending his beliefs and his principals, but I stress this not by destroying other people's property, not turning against people who are at no fault. I repeat, for anything.
DELANEY: But his appeal fell on deaf ears. Further protests Sunday also turned violent. Several police officers were hurt.
The government says it is investigating the shooting. The officer who fired the shots has been charged with manslaughter with intent and has been suspended from duty.
Some of observers say the shooting was the spark that ignited growing unrest among the youth in Greece alienated by the growing gap between rich and poor.
(END VIDEOTAPE)
DELANEY: An autopsy is scheduled tomorrow for the teen shooting victim.
A close encounter with a coyote. How a 9-year-old used his -- snowboard to defend himself.
(COMMERCIAL BREAK)
DELANEY: A terrifying confrontation for a 9-year-old boy and his 6- year-old brother. They were snowboarding at this Denver area golf course when a coyote appeared.
(BEGIN VIDEO CLIP)
TONY SANDLIN, FOUGHT OFF COYOTE: They just saw a coyote out there but I didn't. I wasn't screaming really loud, but I was screaming Cody, Cody! (INAUDIBLE) started circles around me.
(END VIDEO CLIP)
DELANEY: The coyote lunged at the 9-year-old but the boy used his snowboard to chase the animal away. Wildlife officers later found the coyote and killed it. The boy is taking a series of rabies shots.
Well, winter is still about two weeks away but it looks like it is arriving early in iReporter Nick Swann's neighborhood. Check out this photo he sent us from Rochester, New York. Beautiful. He took the picture yesterday when it was about 26 degrees outside. The falling snow makes the area look like a Norman Rockwell picture.
Well, there is chilly weather on tap for several parts of the nation today. Meteorologist Jacqui Jeras is keeping track of it all in the weather center.
Jacqui, when we complain about the temperature here in Atlanta, we have no right, right?
JACQUI JERAS, CNN METEOROLOGIST: We don't. Absolutely not. Certainly not today anyway.
What a pretty picture from our iReporter, by the way. I love that. Those big fat snowflakes.
(WEATHER REPORT)
DELANEY: Hay, Jacqui, how far out do we get to know whether it's going to be a white Christmas in various places?
JERAS: You can talk climatologically where, you know, the averages are, but two weeks out is -- you know, still a pretty good educated guess.
DELANEY: All right. Because I'm looking at you standing in front of a lot of snow there already.
JERAS: In Atlanta, just say no, forget about it.
(LAUGHTER)
DELANEY: I know. Yes, I have seen the reports in Atlanta. Somebody standing next to me with this much snow and saying, there's snow on the ground.
JERAS: Yes, Midwest, they -- they're going to be seeing a white Christmas.
DELANEY: Exactly. All right, Jackie. Thanks so much. Appreciate it.
JERAS: Sure.
DELANEY: Well, President-elect Barack Obama was on NBC's "Meet the Press" this morning and not all the conversation was about official business. Obama talked about his struggle to quit smoking.
(BEGIN VIDEO CLIP)
TOM BROKAW, MEET THE PRESS: The White House is a no-smoking zone, and when you were asked about this recently by Barbara Walters, I read it very carefully, you ducked.
Have you stopped smoking?
OBAMA: You know, I have, but what I said was that -- there are times when I have fallen off the wagon. Yet...
BROKAW: But wait a minute. Does that mean you haven't stopped?
OBAMA: Well, the -- fair enough. What -- I would say is that I have done a terrific job under the circumstances of making myself much healthier and I think that you will not see any violations of these rules in the White House.
(END VIDEO CLIP)
DELANEY: He wouldn't quite commit to saying he'd quit.
Well, desperate times, desperate measures. Buy one, get one free at a car dealership?
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: We've been fielding phone calls, an e-mail increase from every state in the country, looking to get this buy one- get one deal.
(END VIDEO CLIP)
DELANEY: Jaw dropping offers in a cash strapped industry.
(COMMERCIAL BREAK)
DELANEY: Here's a quick look at what's happening now. That sit-in continues at a Chicago factory. Hundreds of laid off workers are occupying the Republic window and doors. Jessie Jackson is meeting with them. The workers had just three days notice before they lost their jobs. Jackson says he's trying to get the Bank of America to restore the stores credit line so it can reopen. President-elect Obama has nominated General Eric Shinseki to be Secretary of Veterans Affairs. Shinseki retired from the army five years ago after he publicly disagreed with the Bush administration with Iraq troop requirement.
And a key player in the big three bail out negotiation says General Motors needs a change at the top. Senator Christopher Dodd says it's time for GM's CEO Rick Wagner to leave.
High gas prices, recession, now the threat of bankruptcy for the big three auto makers. How can you possibly get people to buy cars these days? CNN's Alina Cho reports on what's one desperate Dodge dealer is trying.
(BEGIN VIDEO CLIP)
ALI AHMED, ROB LAMBDIN'S UNIVERSITY DODGE: The first thing people think when they come in is that it is to save gas.
ALINA CHO, CNN CORRESPONDENT: Buy one, get one free. The type of ad you would normally see at a grocery store, but at a Dodge dealership in Miami?
AHMED: We have been fielding the 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 several hundred car dealers shut their doors. That number is expected to top 900 by the end of the year. The majority of those dealers sell American cars.
AHMED: A lot of people are saying it's a perfect storm of gas prices and financing and consumer confidence.
CHO: The biggest problem -- the trickle down 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. A year ago you might have had 15 to 20 salesmen on the floor. Today it's what?
MATT LEE, FLOOR MANAGER: Eight to ten. Salesmen actually walk out because they are not making enough money to support their family.
CHO: They have even stopped bringing in new models because the cars they have aren't moving.
JAMIE KRINSKY, SALESMAN, MAJOR WORLD AUTO: Just you would see five people a day coming in to at least look at a car per salesmen. You are getting only one person a day or two people a day.
CHO: So they are offering deals too, 0 percent financing for 72 months. Seventy five hundred dollar 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? You have to admit, it's pretty catchy.
LEE: If it weren't for them, what can we do? Maybe we will 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 VIDEO CLIP)
DELANEY: The proposed big three bailout loan is a hot topic for many of you. Check out I-reporter Sandra Gardner's comment sent to us from New York.
SANDRA GARDNER, IREPORT: My name is Sandy. I live in a small town southeast of buffalo. I would like to know why I'm responsible for bailing you out. You are the ones who failed; you and your unions are the ones who failed your business. What do I get by you bailing you out and paying my taxes so that you can survive? What is in it for me? Why can't you take your own money and bail your own self out thereby sacrificing instead of me.
DELANEY: Lot of strong opinions about the bailout. Our coverage of the auto industry crisis continues in our next hour. Automotive expert Lauren Fix will join us and answer your questions. Tell us what you want to know. Just send your e-mail to WEEKENDS@cnn.com.
Coping with your own personal credit crises in a shrinking economy. Credit card interest rates are rising and limits are shrinking.
(COMMERCIAL BREAK)
DELANEY: A deadly shoot-out in Baghdad more than a year ago now charges against five former American security guards. They all worked for Blackwater World Wide. CNN's Susan Simon. We look at the men and the charges.
(BEGIN VIDEO CLIP)
SUSAN SIMON, CNN CORRESPONDENT (voice over): They are the faces of former U.S. servicemen all in their 20s. Donald Ball, 26 from Utah a former U.S. Marine Corporal and Eagle Scout. Dustin Heard, 27, from Tennessee. A former U.S. Marine Corps corporal. Evan Liberty, 26 from New Hampshire, a former U.S. Marine 2nd Marine Division. Paul Slough 29, from Texas, former U.S. Army Third Infantry Division. And Nick Slatten (ph), 25, from Tennessee. Former sergeant in the U.S. Army. They are also former Blackwater guards who are expected to turn themselves in to federal authorities on Monday on charges that are expected to include manslaughter, assault, and a weapons violation. Though it's not clear which men will face which charges.
Sources with knowledge of the case say a sixth contractor is negotiating a plea deal with prosecutors. The Iraqi government says 17 civilians were killed in a deadly shooting in a Baghdad traffic circle in September of 2007. No one denies the men were involved. The company they worked for, Blackwater has said all along that the men were responding to insurgent fire. A defense attorney for Dustin Heard says that the Blackwater guards were, quote, "Were defending themselves and their comrades who were being shot at and receiving fire from Iraqis they believed to be enemy insurgents in a place where enemy has made a major city, Baghdad, the battlefield."
An attorney for Paul Slough says, "We are disappointed that Federal prosecutors have taken it on themselves to second-guess how these brave young men fought for their lives." But it was a different story from Iraqi witnesses. Some of them told CNN the men opened fire for no reason. The youngest victim, a 9-year-old boy.
The Iraqi government was outraged and called for Blackwater to be expelled from the country.
NURI ALLEN:-MALIKI, IRAQI PRIME MINISTER: It cannot be accepted by an American security company to carry out a killing. These are very serious challenges to the sovereignty of Iraq.
SIMON: But the U.S. State Department intervened, insisting it could not do its work without Blackwater guards. There are no indictments expected against Blackwater itself, which says the men haven't been on the payroll since last year. The justice department is debating what charges to bring in part because there's no clear legal accountability for contractors in Iraq. The coalition authority in 2004 made them immune from Iraqi prosecution. That's set to change next year under a new agreement between U.S. and Iraqi authorities. The new deal will make contractors accountable to Iraqi law.
Susan Simon CNN, Atlanta.
(END VIDEO CLIP)
DELANEY: Millions of Americans at risk of losing their homes. Wondering why they are not getting help while big banks get billions in federal aid. A top banking regularity shares their feelings and wants to make changes. Here is CNN's Deborah Fehr (ph).
(BEGIN VIDEO CLIP)
DEBORAH FEHR (ph), CNN CORRESPONDENT (voice over): When Eddie Morrison heard about the government's $700 billion bailout, his first thought was.
EDDIE MORRISON, HOMEOWNER: Can anybody help me there?
FEHR (ph): Behind on his mortgage payments, Morrison is a truck driver making $65,000 a year was sure the foreclosure letter was in the mail.
CORINTHIA MORRISON, HOMEOWNER: I was getting nervous to the point where I started packing.
FEHR (ph): Instead, Indy Mac, the bank which had given the loan was seized by federal regularities and its new administrator FDIC chairman Sheila Bair put a freeze on foreclosures, giving people like the Morrison's a chance to modify their loan to a rate they could afford.
SHEILA BAIR, FDIC CHAIRMAN: Foreclosures keep going up and home prices keep going down and we have got to stop the spiral.
FEHR (ph): Bair has publicly taken on the treasury and Federal Reserve. They say it's critical to attack the root of the problem by helping homeowner's, not just big institutions.
Based on the model you created with Indy Mac, how many homes do you think you could save right now?
BAIR: We could prevent 1.5 million foreclosures from occurring.
FEHR (ph): Under her plan, people 60 days late paying would get a chance to reduce high interest rates and extend the length of their loan if they qualify. So why isn't it happening?
BAIR: I have been in watching for a long time and why we haven't been able to garner the political world to tackle this problem has been somewhat mystifying to me.
FEHR (ph): Critics called Bair's proposal a subsidy for troubled borrowers.
BERT ELY, CATO INSTITUTE: They would be better off giving up the home and renting for a while.
FEHR (ph): Bair estimates the program would prevent 34 percent of foreclosures expected over the next two years.
BAIR: We think it will work. I wish we could all make a decision.
FEHR (ph): As for families like the Morrison's.
MORRISON: Not a bailout because I still have to pay.
FEHR (ph): And they get to stay home.
Debra Fehr (ph), CNN, New York.
(END VIDEO CLIP)
DELANEY: If you have been hit by a higher credit card rate and fees, cuts and spending limits or maybe you are worried about your credit rating. Well Donna Rosato reports on consumer issues from "Money" Magazine. And she joins us now from New York, Donna great to have you with us.
DONNA ROSATO, SR. WRITER, "MONEY" MAGAZINE: Great to be here.
DELANEY: So Donna we are hearing some disturbing data, we know that credit card delinquencies are at their highest levels in 60 years, defaults are up as well. We are wondering is there any chance we could soon be talking about a collapse in the credit card market just like we have been in the mortgage market.
ROSATO: The credit card market is just a fraction of the $12 trillion mortgage market, but nonetheless there's about a trillion dollars worth of credit card debt outstanding. And with the economy in a recession and jobless rates increasing, that is likely only to get worse. Your default rates on credit cards are only likely to get worse.
DELANEY: And we are hearing very disturbing reports of people seeing their credit limits being cut and their fees going up. This couldn't happen at a worse time as we go into the holidays and people are making considerable use of their credit cards. So why is that happening?
ROSATO: Well, that's right. You are seeing banks tightening up their lending standards. They are raising rates. They are reducing their credit limit. Banks, it's sort of a vicious cycle. Banks are paying the price for loose lending standards the past number of years, so they are making it tougher and raising the requirement for the people they lend money to and trying to reduce their risk. Some people also believe that banks are trying to get ahead of proposed tougher regulations that will limit their ability to raise rates on consumers that have been proposed by the Federal Reserve and that are likely to take place next year. One study by a group called Consumer Action found that nearly 40 percent of credit card issuers have raised their rates across-the-board. Even for people with good credit in the past year.
DELANEY: And apparently they are doing quite well. We gather banks made something like $18 billion in late fees and boosted interest, so clearly capitalizing on these new situations that make life very miserable for us consumers. So what can we do? Nobody wants to go to try to purchase something and then realize that their credit limit has been cut. Is there anything that is at our disposal to prevent this happening or to prevent our fees being increased?
ROSATO: Sure. The number one thing you can do to prevent your interest rate on your credit card from increasing or your limit being reduced is to be a good customer. Pay your bills on time every month. One late payment, one missed payment, and you're going to see your credit rate, interest rate sky rocket. And that's also true if you pay late on another bill. There's something called universal default that gives credit card companies the right to raise your rate if they consider you risky or late on other loans as well.
There are a couple of things that you can do, pay more than the minimum payment every month and don't max out your credit. It's probably good to keep at least 50 percent of your credit line open and available. So that means not racking up a lot of debt.
DELANEY: Obviously times are tough. People are struggling with the holidays. Before you go, is there anything somebody can do if they know their minimum payment is $40, they can only afford 30, say, can they contact the credit card company and do anything to avoid damaging their credit card score?
ROSATO: Definitely. You should always be pro active. There are some credit card companies reaching out to consumers. J.P. Morgan Chase for example has been reaching out to people who have had trouble making payments. If you feel like you're going to fall behind, contact them. They can help you try to work something out. It's always better to be pro active, especially if you are going to, if you think you're going to have trouble. Before that happens reach out to them and talk to them see if you can get a better payment schedule for yourself.
DELANEY: Don't be afraid because a lot of people live in fear. Donna, we thank you very much for joining us. Donna Rosato, senior writer with "Money" Magazine.
ROSATO: Thank you.
DELANEY: In a sea of humanity on a pilgrimage, 3 million Muslims on a single mission to ask for forgiveness. We will take you to the heart in Saudi Arabia.
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DELANEY: Millions of Muslims focusing on forgiveness at the annual Hajj Pilgrimage in Saudi Arabia. CNN's Arwa Damon was there.
ARWA DAMON, CNN CORRESPONDENT: We are at the base of Mt. Mercy. Some pilgrims have spent the entire night camping out in tents. Others have been sleeping on the ground. All in anticipation of today's sacred ritual which begins when the sun comes up. This is the moment that all of the pilgrims have been waiting for because it is here at Mount Mercy that Profit Muhammad delivered his final sermon some 1400 years ago asking god to forgive his followers. The pilgrims will be doing the same. We have seen them praying with their arms outstretched, often times overcome with emotion as they ask god for forgiveness.
Pilgrims who we have spoken to who performed the Hajj in the past have said that it is here where they have felt closest to god. We are here with a Dr. Faisal Muqaddam a general practioner from South Africa on his 14th Hajj. His wife is a tour operator and his daughter Eman (ph) she has been here seven times. Doctor, what is it about this experience, especially here at the Mount of Mercy that makes this so special?
FAISAL MUQADDAM, MUSLIM PILGRIM: The Mount of Mercy, as you call it is a place where every believing human being who has heard and has had fault in his past life can come and cleanse himself and ask for total forgiveness. I think this is what drives one to come over and over. It's to quench one's thirst from all the human errors that one commits over the years.
DAMON: The journey here very much about achieving an elevated spiritual status. For some it's a second chance at life. Saudi authorities are estimating there are some 3 million pilgrims performing the Hajj this year. Some like the doctor we just met has been here multiple times. Others have saved their entire lives for this very moment.
Arwa Damon, CNN, Saudi Arabia.
DELANEY: It started as a promise on a reality TV show, and now it is making a difference across the globe. A survivor winner puts his money where his mouth is.
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DELANEY: It began with one man's promise to raise awareness of the HIV Aids crises in Africa. CNN's Barbara Starr explains in our "Impact Your World" report. He did it all with his feet.
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BARBARA STARR, CNN CORRESPONDENT (voice over): For Ethan Zohn, dribbling a soccer ball is second nature. Could dribbling a ball while walking from Boston, Massachusetts to Washington D.C. is a march of determination to bring attention to the HIV aids crises facing children in southern Africa and around the world.
ETHAN ZOHN, FOUNDER GRASSROOT SOCCER UNITED: I lived and played professional soccer in Zimbabwe. When I was there, I witnessed first hand what was happening with HIV and Aids and how it was really destroying this community that I was a part of.
STARR: You may remember Zohn from the hit TV show "Survivor." He won the third season and it was on the show he pledged to use his winnings to make a difference.
ZOHN: The grand prize of winning "Survivor" was a million bucks. So I used some of that money to start drafting soccer.
STARR: This charity uses the allure of the sport to educate.
ZOHN: Seeing the power of soccer and the role models this sport creates, it was really an easy formula where we can take these guys, send them into the classrooms and really have an impact on these young kids' life. Really have the ability to change their behavior so they can go out there and lead a healthy lifestyle.
STARR: So far what started as a promise made on a TV reality show appears to be making a real difference in the lives of thousands of children? For "Impact Your World," Barbara Starr, CNN.
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DELANEY: If you would like to learn more about Grassroots Soccer United, visit our "Impact Your World" web page. That is at CNN.com/impact.
And the next hour of CNN NEWSROOM starts right now.
Barack Obama makes his choice for secretary of veteran affairs. So who is retired army General Eric Shinseki and why is he a favorite of those who do not like President Bush?
The complex multibillion dollar proposed bailout loan for the big three, an auto industry expert answers your e-mail questions throughout this entire hour.
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MICHELLE OBAMA: It's well past time for everyone to leave. I think that's obvious.
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DELANEY: About 600 dead already from an outbreak in Zimbabwe. The U.S. and others in the international communities say enough is enough.
