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Aired December 12, 2008 - 09:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

HEIDI COLLINS, CNN ANCHOR: Automakers lifeline falls short. Bailout loan bill dies in the Senate. What the White House could do now to keep Detroit in business.
And the auto industry's defeat could lead to big losses for you. Wall Street opens bottom of the hour and we are there.

It's Friday, December 12th, I'm Heidi Collins. You are in the CNN NEWSROOM.

What now? The question to everybody, seems to be asking from Detroit to D.C. after talks collapse. And the Senate fails to pass a plan to rescue automakers. An effort to bring the measure to a vote was blocked largely by Republicans on a 52-35 vote.

The White House could step in. It was instrumental in hammering out the plan that sped through the House a little bit earlier in the week. That bill provided $14 billion in emergency loans for Chrysler and General Motors, and then paved the way for federal aid for Ford.

CNN crews are, of course, all over these developments. We have Kathleen Koch at the White House this morning. Christine Romans with market reactions from New York.

We begin, though, with Kate Bolduan who is on Capitol Hill this morning.

A long debate that pretty much ended up going nowhere, right, Kate?

KATE BOLDUAN, CNN CORRESPONDENT: Yes, absolutely. I think it's proof that nothing is a done deal on Capitol Hill until it is a final vote, Heidi. You and I both know that. We see that more often, unfortunately, than not.

Now, effectively, I must say, the idea of an auto bailout, this auto bailout bill, this legislation, is effectively dead here on Capitol Hill. Through the end of the year for this -- for this session.

You mentioned it that 52-35 was a procedural vote last night. That failure of that vote came after hours of late night, behind closed doors negotiations between Democrats and Republicans on the Senate side trying to hammer out a deal, somehow trying to find a compromise between the House-passed bill, as -- incorporating some measures that Republicans were requiring, more -- some of the big points were more taxpayer protection as well as wage parody.

Now the final sticking point, we shouldn't point out, as I'm told by Republican senator Bob Corker, is date certain on when the American auto workers for Chrysler and GM would be required to accept wage parody.

Wage parody for benefits as well as wages with auto workers in the United States working with foreign auto companies. Now that seemed to be the final sticking point. And Senator Bob Corker, the Republican that was instrumental in the late-night negotiations, spoke on CNN just a few minutes ago. Listen here.

(BEGIN VIDEO CLIP)

SEN. BOB CORKER (R), TENNESSEE: We -- we had an arrangement last night that we were just six minutes away from a full agreement that would have really caused these companies to be able to go in the future very healthy -- healthily.

The -- we worked out the capital structure, which is the amount of debt these companies had. We had bond holder exchanges. We had equity cramdowns. We had all kinds of things that were agreed to. And it came down to one thing and that was just getting the UAW to agree to a date certain that they would be competitive.

(END VIDEO CLIP)

BOLDUAN: Now you can see, as Senator Corker was pointing out, there's a lot of agreements. Senators came out in the late-night negotiations saying they did have agreement but in the end they just could not cross the finish line as Senate Majority Leader Harry Reid said.

So, Heidi, the big question, what now?

COLLINS: Exactly.

BOLDUAN: Well, two -- exactly. Two Republican congressional sources tell CNN that the Bush administration officials have been warning, wavering senators, wavering Republican senators that if they could not get behind this bailout legislation, then the White House may have to step in and tap that -- the funds from the Wall Street bailout that they have, up until now, been strongly opposed to.

They have refused to and that was kind of the source of some of the deadlock early on in these talks.

Many people today, Heidi, needless to say, scratching their heads saying where do we go from here?

COLLINS: Yes, absolutely. All right. Obviously a lot more of the story to be covered.

From Capitol Hill, Kate Bolduan, thanks so much for that this morning. Meanwhile, as Kate was just saying, the auto industry now looking down Pennsylvania Avenue toward the White House. Will the president actually step in on that?

Let's go ahead and bring in Kathleen Koch now.

So, Kathleen, what are they saying at the White House this morning? I know there's been a statement that's been released.

KATHLEEN KOCH, CNN CORRESPONDENT: Yes, Heidi. Well, first of all, it's important to point out this is exactly where the White House did not want to be.

COLLINS: Right.

KOCH: Because this puts the ball right back in their court. Certainly the White House lobbied very hard in this measure. White House press secretary, Dana Perino, yesterday saying, the president, the top administration officials, would be spending time on the phone calling reluctant lawmakers, listening to their questions and concerns, trying to persuade them that this was really the best way to go.

But as an indication of how little political capital this lame duck president has left, one Republican senator told CNN's Dana Bash that he refused to even take that call from the White House, sending along the message instead that they would be wasting their time.

So yes, the White House, in a statement, did say it was disappointing and that the vote failed. The statement went on to say, quote, "We think the legislation we negotiated provided opportunity to use funds already appropriated for lawmakers and presented the best chance to avoid a disorderly bankruptcy while ensuring taxpayer funds only go to firms where stakeholders were prepared to make difficult decisions to become viable."

Now Fratto says right now the administration is weighing its options. White House will not confirm that it actually has threatened that it might go to using some of those funds from the Troubled Asset Relief Program but again, as Kate mentioned, the White House has staunchly refused to go there, saying that money is meant for the financial services industry, not meant to bail out auto makers.

So the White House is not ruling anything in or out definitively, Heidi.

COLLINS: Sure.

KOCH: But certainly it's not looking good for Detroit right now.

COLLINS: And we talked with Tony Fratto here on the program yesterday.

When are we likely to hear something more from the White House regarding their decision if there is actually one to be made here? KOCH: Well, we're opening to hear something today. Right now White House press secretary Dana Perino is on her way to Texas with the president where he's going to be speaking. We hope, again, we'll hear from her -- aboard Air Force One but right now, the president is not scheduled to make any remarks on this today.

So we'll have to wait and see.

COLLINS: Right. OK. All right. Kathleen Koch, coming to us from the White House this morning.

Thank you, Kathleen.

KOCH: You bet.

COLLINS: And Senate's inaction sent stock markets tumbling, too. Our Christine Romans is watching that and waiting for the opening bell in New York.

So what are we expecting to see this morning, Christine?

CHRISTINE ROMANS, CNN CORRESPONDENT: Well, you know, Senator Harry Reid has said that he dreads to see what happens on Wall Street. And indeed, overnight, you saw -- you know financial markets tumble in Asia. Stocks down, you see oil down, on concerns that you're still going to have this -- American recession and global recession that's going to reduce demand.

And you got Dow futures here down about 260 points. They've been down more than 200 points, at one point, down more than 300 points, pretty much all morning now. The caveat there, Heidi, is that we know, at this time, with 22 minutes to go to the opening bell, it can be pretty erratic and -- futures market, this crazy market environment -- you know, it's been hard to really gauge exactly what's going to happen but...

COLLINS: Yes.

ROMANS: ... it's also been a pretty decent bear market rally, as they call it, in -- the market in the past week and a half or so. So there's also a feeling that this is an excuse maybe for investors to take so many off the table.

Concerned, again, about just what direction Detroit is going, what that's going to mean for the overall economy. And what does it mean for the economy? Well, if you listen to automakers and the people who -- who support the automakers, this comes at a terrible time.

You know, David Kohl, the chairman of the Senate for automotive research, put it this way. To permit any of the Detroit three manufacturers to collapse would scar the U.S. economy further at a when it can ill afford another blow."

You've got Ford and GM shares trading down in Europe, trading down in pre market trading, before the actually market opens, indicating that they will likely be down when trading begins.

Cerberus, which owns Chrysler, of course, is a private equity -- private company. It doesn't -- it doesn't trade publicly here.

What I'm hearing mostly from people as -- sort of surveying the wreckage, the political wreckage after last night, in trying to figure out where we go from here...

COLLINS: Yes.

ROMANS: ... for these companies.

COLLINS: Well...

ROMANS: GM, the first one mostly like to fall into bankruptcy. Chrysler comes next. Ford is in the best position. And again, remember, Ford went to Congress and said we'd like a backstop. We'd like a line of credit but we don't necessarily need a bridge loan right at this minute. We want the option but we don't need it right now. We hope we can avoid it.

But if there's bankruptcy in the other two, that puts a lot of pressure on suppliers. Supplier bankruptcies, and that would pressure Ford as well. So you're really, you're really -- you know, staring down the barrel right for these companies about what happens next.

COLLINS: Yes, absolutely. Really, really quickly, Christine, probably worth mentioning and talking about briefly here, what happens when a company goes into bankruptcy. We should be clear that does not automatically mean -- the firing of 3 million people, if you will.

ROMANS: No.

COLLINS: Three million do not immediately lose their jobs. There is a time frame here and possibly, a -- chance, is there not, for them to, in restructuring and so forth, whatever they decide to do, to get healthy at some point or is that ridiculous?

ROMANS: In normal times bankruptcy -- it's called bankruptcy protection.

COLLINS: Sure.

ROMANS: The -- a bankruptcy judge, a bankruptcy court helps the company reorganize, decides what bills get paid, who gets paid first, restructures the debt so that the company, if the company is going to have a chance to come out, can come out. Takes a look at all the agreements and contracts, maybe have to rewrite some of those in normal times.

That's when credit is flowing, when a company in bankruptcy protection can get new credit or can renegotiate its credit.

These aren't normal times.

COLLINS: Yes. ROMANS: Credit is very, very fragile here right now and there's a great concern that under bankruptcy, it wouldn't be like a normal bankruptcy procedure, simply because of the size of this industry, A, and B, because these are not normal times.

COLLINS: Yes, absolutely. A little bit different than what was...

ROMANS: Sure.

COLLINS: ... airline industry, of course.

All right, Christine Romans, we'll be following that story with you. Thanks so much.

Meanwhile, former NASDAQ chairman Bernard Madoff is free on $10 million bail this morning. You may not have even know that he was arrested but he was yesterday on single count of securities fraud.

Madoff is accused of offering a "Ponzi scheme" which lures new investors with the promise of big return. The money, though, comes from other investors, not from any real revenue.

Federal authorities say Madoff ran the scheme from his investment advisory business.

Talking more severe weather today. Rob Marciano standing by now to tell us a little bit more about it.

Are we still talking about the same trouble spots here, Rob?

(WEATHER REPORT)

COLLINS: All right, Rob. Thanks so much for that.

ROB MARCIANO, AMS METEOROLOGIST: All right.

COLLINS: We sure do appreciate it. We'll be continuing to watch the weather.

Something else that we are continuing to watch, a little bit of news coming into us right here now out of Upper Montgomery County, Maryland. We are hearing something about a ferry that is stuck in the Potomac River. Apparently, a whole bunch of debris and the river got stuck this morning. About 20 people on board, I'm hearing.

I believe, do we not have someone that can talk a little bit more about this? Pete Piringer is on the line with us, Montgomery County Fire and Rescue.

Pete, tell us a little bit about what is going on here. I believe it began about an hour ago or so. Is that right?

PETE PIRINGER, MONTGOMERY COUNTY FIRE AND RESCUE: Yes, good morning. A little after 8 o'clock we received a call from White's Ferry. Now White's Ferry is a ferry that runs on a cable car carrier that runs between Montgomery County Maryland and Lowden County, Virginia...

COLLINS: OK.

PIRINGER: ... which is Leesburg. And there was -- we started to buoy for as far as the storm was concerned but we were under a flood watch yesterday, and up river they were getting some storms and a lot of debris, a lot of trees.

COLLINS: Wow.

PIRINGER: And some high water affected the cable that the ferry actually ran on. They tried to make it across this morning and got stuck, and actually were unable to make it back. So we have some rescue boats in the process of bringing those people down river.

All had about 20 people -- 20 cars and about 24, 25 people on board and in the process of offloading them on to some rescue boats and bringing them to shore.

COLLINS: OK. So it sounds like you have the situation pretty well under control. Just out of curiosity, though, a storm ever cause this type of situation before that you've been around for?

PIRINGER: Well, from time to time, the ferry does cancels (INAUDIBLE), cancels service for high water or -- and/or debris, but...

COLLINS: Yes.

PIRINGER: ... I think in this particular case, they just got stuck in a debris field this morning and were unable to proceed. And we're working on getting a stabilized situation. But -- it's going to be a while before, I think, they resume operations.

COLLINS: OK, once again, about 20 people on board. So we'll stay on top of that story for everybody here.

Thanks a much, Pete. Sure do appreciate that.

Meanwhile, a new development as well in the investigation of a missing Orlando girl. What happened during an overnight search of her grandparents' home?

(COMMERCIAL BREAK)

ANNOUNCER: This is CNN Breaking News."

COLLINS: Quickly, we have a little bit more information now regarding the auto bailout. As you know, that plan did not pass in the Senate last night. Some people very surprised by that. Others not.

We do have some information now coming in directly via Dana Perino from President Bush regarding, you know, what is going to happen next. And Christine Romans has more on that for us.

Hi there, Christine.

ROMANS: Hi there, Heidi.

We've been talking about what next for the -- the Big Three automakers after the collapse of that bill overnight. Well, we know now the White House has issued a statement saying it will consider using the rest of the bank bailout funds to help Detroit.

So this is something the White House has resisted for some time. That was $700 billion passed by Congress to be used for the financial services industry, for the banking system, to shore up the financial infrastructure of -- this country, of the economy, and now the White House is saying that it will indeed considering using what are called TARP funds, the bank bailout, the bank rescue funds, to help -- to help Detroit.

This is what they say, "Under normal economic conditions, we would prefer that markets determine the ultimate fate of private firms. However, given the current weakened state of the U.S. economy we will consider other options, if necessary, including use of the TARP fund, the TARP program to prevent a collapse of troubled automakers."

A precipitous collapse of this industry will have a severe impact on our economy and it would be irresponsible to further weaken or destabilize our economy at this time. The lengthy statement, pointedly mentioning that Congress had failed to pass important legislation and the White House was going to have to consider taking matters into its own hands to try to shore up Detroit.

So that is what's next for Ford, GM and Chrysler after the collapse last night of that bill. Now, the White House, as some has suspected, sort of being forced to step in here and saying that it will -- it will have to consider all options including using what's left of that bank bailout money.

They've earmarked the Treasury secretary, Heidi, $335 billion for banks, insurance companies and the like. There's 15 billion left to spend of the first segment of the bank rescue money and then the next Treasury secretary can go to Congress or this Treasury secretary, frankly, can go to Congress and ask for another $350 billion that's already been approved.

So it looks as though that bank bailout money, in the end, may end up being what is used to extend those bailout loans, lines of credit, low interest loan, bridge loans to the industry.

COLLINS: Yes. Yes. All right. Well, Christine, we sure do appreciate that. And we'll be staying on top of this one. In fact, for now, it's interesting to talk to a labor law professor who we've had on a couple of times before.

In fact, for god's sakes, I hope the president acts. That is the direct quote from the mayor of Lansing, Michigan after the Senate fails to grant those emergency loans to the auto industry.

Charles Craver is the labor law professor at George Washington University that we've been speaking with throughout this situation.

And we appreciate you joining us again, Professor. I'm sure you just heard the information coming in from our Christine Romans via the White House about the fact that they say would just be irresponsible to allow this to happen. Your thoughts?

CHARLES CRAVER, GEORGE WASHINGTON UNIVERSITY: Oh I agree. I think they're facing a tremendous crisis in the states like Michigan and other similar states.

If the auto industries were to go down the calamity would be huge, but surprising is that the Republicans in the Senate have completely disregarded their own president and it bodes ill for what will happen after President Obama takes office in January because there are going to continue to be tremendous issues in health care, Social Security, Medicare and in the financial crisis.

COLLINS: Well...

CRAVER: And if they can't agree, they're going to have a terrible dilemma.

COLLINS: Well, let's stay on the auto bailout for now, though, simply because this is obviously what we're dealing with today. You, in fact, said, that you were, quote, "shocked" by the vote last night. How so?

I think there've been a lot of information out there that said that -- it was probably going to go this way?

CRAVER: Well, I'm shocked because they impose almost no similar restrictions on the financial industry. They gave them the money with almost no ban on bonuses and huge salaries.

COLLINS: But, Professor, is it a fair comparison? We're talking about 700 billion versus, initially, 34 billion and then reduced down to 15.

CRAVER: Well, I mean, it would have been easier to get the 15 billion from now until the beginning of the new year without having all these restrictions. They're demanding a wage cut somewhere in the range of $14, $15 an hour.

And many in the Toyota plants in areas of the country, they're much lower cost of living areas, than you have in the Michigan area, and so you're comparing apples and oranges.

COLLINS: Well, what about this 15 billion that is, quote, "leftover" from the TARP money? The first segment of that TARP money anyway. We're just hearing Christine talk about it.

Why would there be -- and I'm sure there will be -- people who are upset that the -- again, quote, "leftover" money would be used in this manner for a possible auto bailout?

CRAVER: Because I think President Bush realizes, as he said this morning, that if the auto companies were allowed to go down, the financial impact not simply in the auto industry but in all the industries that deal with auto manufacturers and the homeowners, and the restaurants and the stores, they would be dramatically impacted and that would affect the financial world.

COLLINS: Right, but I'm saying, who would have a problem with that?

CRAVER: Well, I think, in the end, nobody. I have a feeling Bush will go ahead and extend the money and the Republicans in the Senate will save face at home politically but they will not further the United States.

COLLINS: How quickly does this need to happen?

CRAVER: I think it's going to have to happen next week or two because it sounds as if General Motors and Chrysler in dire economic states at the present time. The other issue I'll mention which is a huge issue that nobody is talking about is the biggest issue is the benefits to retirees and their dependents which is in the trillions of dollars.

COLLINS: All right. Well, we will continue to follow the story. Obviously, developments continue to happen along these lines just about every minute or so.

And Charles Craver, we, obviously, appreciate your time here once again. He's a labor law professor from George Washington University. Thanks so much.

CRAVER: Thank you.

COLLINS: And now on to another story, a medical one. The trouble with inhalers. An expert panel says a couple of drugs shouldn't be used to treat asthma.

Our Dr. Sanjay Gupta has the story.

(COMMERCIAL BREAK)

COLLINS: Expert panels calling on the FDA now to ban two inhaler drugs from being used to treat asthma. The two drugs in question, Serevent and Foradil.

Our Dr. Sanjay Gupta is joining us now to talk a little bit more about this, because there are a lot of people out there, number one, that have asthma and I think that we are talking about children here as well, right?

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: Yes. These are popular drugs. And people who have asthma or had these sorts of symptoms in the past know the names of these drugs.

This is sort of an interesting glimpse at the way this whole process works. The drugs are going to get approved. And committees review them. Now the two drugs you mentioned, Serevent and Foradil, specifically, they are what are known as beta agonists. They are supposed to be given with a steroid. Opens up your airway, allows you to breathe better if you're having an asthma attack.

Here's the problem. If you don't give it with a steroid or the person doesn't take it with a steroid, it can have almost a paradoxical or opposite effect. In fact the FDA committee warns that some of these medications could actually make things worse for people, putting people at risk of a severe attack, even death if not used with steroid.

Problem is, Heidi, a lot of people don't use them with a steroid. In fact, according to their studies, about half the people aren't using these medications properly. So it's a real danger out there.

COLLINS: And...

GUPTA: There are other medications, Advair and Symbicort, for example, where you give the steroid and the -- agonist together so it's much safer.

COLLINS: OK. Yes. It's just one drug at a time.

GUPTA: Yes.

COLLINS: So you're not saying that doctors are not prescribing them correctly. You're saying that people are opting to not take the steroid because nobody wants to take the steroid if they don't have to.

GUPTA: That's right. And I think it is a message for patients and doctors alike probably. Just the way that the, the medication is supposed to be given isn't always happening both on the prescribing end as well as the patient's end.

These medications aren't going to go away because they still have some use in other lung diseases but the FDA committee was pretty strong in their recommendation they no longer be used for asthma because they're being used improperly.

COLLINS: And then as I mentioned, children. You know a lot of kids seem to -- are now having -- seem to have trouble with asthma.

GUPTA: That's right. Childhood asthma in which sometimes you grow out of, but you do need medications sometimes with that. Symbicort, one of the medications we're talking about, has never been approved for children so that's not an issue.

Advair is interesting because the proof for older children, but the committee was sort of split on younger children. Right down the middle almost in terms of how they thought this medication should be used in young children. So they haven't reached a consensus.

COLLINS: It had to do with -- the development of their lungs at a younger age or something? GUPTA: Well, they're not sure that it works. They're not sure that it's having the intended effect. And again, there's this concerned it could have almost a -- an opposite or paradoxical effect.

The other two medication that you mentioned, Serevent, or Foradil, they're saying the same thing. Should not use these medication in children. The companies, we talked to them as well, I should say.

COLLINS: Right. Yes.

GUPTA: They're saying we're going to continue to study. What the FBI committee is saying is not in line with our own clinical studies but stay tuned.

COLLINS: Yes.

GUPTA: We're going to -- we're going to give more data. So I haven't heard the last of this, but again, this is a pretty big deal when it comes to the world of asthma medications.

COLLINS: Absolutely, in the FDA as well.

All right. Dr. Sanjay Gupta, our chief medical correspondent. Thank you.

GUPTA: Thank you.

COLLINS: Well, the opening bell, just about to ring on Wall Street for a Friday. You see the clapping there which usually indicates the bell will be just seconds away. And a lot of people say, boy, glad this week is over.

Stephanie Elam is standing by now to talk a little bit more about some of the factors that are expected to drag the market down today. One of them, we know, for sure, Stephanie, the Asian markets.

STEPHANIE ELAM, CNN BUSINESS CORRESPONDENT: Definitely, Heidi. And I'm sure a lot of people wish that we didn't have trading today but we do because we are looking for a dismal open.

Futures are showing a roughly 250-point drop for the Dow Industrial. The main reason for that, as you might expect, is the failure of the auto bailout bill in the Senate. The last-minute collapse sent carmaker shares tumbling at after-hours trading.

GM and Ford aren't expected to fair much better during the session. I'll keep my eyes on those as well.

The failure of the bill cast serious doubts on whether GM or Chrysler will be able to make it without going into bankruptcy. Now in the last 15 minutes, the White House said it will consider using funds TARP funds to help the auto makers if necessary. We'll see if that helps out stocks today. Also not helping matters, news that Bank of America is slashing as many as 35,000 jobs over the next three years, this as it absorbs Merrill Lynch. The cuts will affect all lines of business at B of A, though it won't announce any official reduction in plan until early next year. That sounds so far away but really isn't. Meanwhile, prices at the wholesale level fell more than two percent in November, worse than analysts were expecting. Let's take a quick look at the numbers here. The Dow off 181 points, 8377, so off two percent out the gate. NASDAQ off close to two percent as well, Heidi.

COLLINS: All right, Stephanie Elam, thanks for that. We'll watch those numbers today.

Meanwhile the death of the bailout loan bill rippling far from the shores, we'll get a live report coming in from Berlin.

(COMMERCIAL BREAK)

COLLINS: A failed U.S. auto industry, how would it play around the world? CNN's Frederik Pleitgen is joining us now live in Berlin. You might be surprised about some of the effects.

Frederik, good morning to you.

FREDERIK PLEITGEN, CNN CORRESPONDENT: Hi, Heidi. Good morning.

You're absolutely right. The failed plan is having massive effects here in Europe and there's a lot of worries here in Europe.

If you think about it, American car companies employ well over 100,000 people here in Europe alone. You think about companies like Volvo or Saab which are owned by GM and Ford respective, then there is Opel, which is a German subsidiary of GM, some of those are actually sold as Saturns in America. Those companies are all very, very worried about what the future might bring if indeed the Big Three should fail.

Some of those smaller companies are actually trying to negotiate bailouts with some of the respective national governments. Opel is in talks with the German government and the Swedish government has just announced a bailout for its car industry so that would help Saab and help Volvo which are owned by GM and by Ford.

But there is certainly a lot of worry going around. One of the things that actually surprises me about the picture in Europe is that none of the big European companies actually seem to believe that if one of the Big Three were to go bust in America, Americans would start buying more European cars. No one seems to believe that. Most people here believe that the effects would be so big, absolutely.

The effects would be so negative on the American economy, Americans would just start buying less cars in general. So all automakers here in Europe are very worried about what is going on in America. It's not just automakers, it's also auto suppliers that are very, very worried. That market is so globalized, if you look at companies like Continental Tires or Bosch who are both here in Germany. They supply massive amounts of parts to American companies. And certainly they have no interest in American car companies failing, Heidi.

COLLINS: I guess I really I hadn't thought about it that way because the public perception is that a lot of Americans already buy their cars from overseas. We'll continue to watch that one as well.

Frederik Pleitgen, thanks so much, live from Berlin this morning.

And now to a new development in the Caylee Anthony case. Central Florida investigators think they've found something of interest in an overnight search of her grandparents' home. The three-year-old girl, as you know, has been missing since June. Yesterday a utility worker found a child's skull near the Anthony's home.

Caylee's mother, 22-year-old Casey Anthony, is being held on first degree murder charges as she waited a month before reporting Caylee missing. Anthony's mother called the sheriff's office and told them she has not seen her for a month and her daughter's car smelled like death. Again, investigators have been searching the home of Caylee Anthony's grandparents, they are trying to determine if the remains found are those of three year old Caylee.

An Orange County sheriff's deputy appeared on "Good Morning America" this morning. Here is what he had to say about the search.

(BEGIN VIDEO CLIP)

SHERIFF KEVIN BERRY, ORANGE COUNTY, FLORIDA: There are certain things they want to be looking for. Some of those clues came from the crime scene yesterday and a lot of items are taken into our custody for review.

UNIDENTIFIED FEMALE: I know you can't go into detail, but there was something that was found that made you want to search the grandparents' home?

BERRY: Absolutely.

(END VIDEO CLIP)

COLLINS: We are following this case, of course, and CNN will bring you the very latest developments on the investigation as we learn them.

Jurors in the Brian Nichols case returned for a fourth day of deliberation. The jury was unable to reach a unanimous decision on a sentence of life in prison or death for Nichols. Nichols was convicted of killing a judge and three others in a violent crime spree that began in a downtown Atlanta courthouse nearly three years ago.

Pressure is mounting for Illinois Governor Rod Blagojevich to step down. Key Democrats are now urging support for impeachment. President-Elect Barack Obama again calling for Blagojevich to resign. The Democratic governor was arrested this week on charges of trying to sell Obama's former Senate seat.

CNN's Susan Roesgen reports now from Chicago. (BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: Are you going to work, governor?

SUSAN ROESGEN, CNN CORRESPONDENT (voice-over): Still going to work as if nothing has changed. But for Illinois Governor Rod Blagojevich the options have dwindled to just two. Jump or be pushed.

LT. GOV. PAT QUINN, (D) IL: I think the governor has lost the confidence of people of Illinois and when you, in public life in the statewide level have no confidence from the people. In a democracy, there's nowhere else to go but to resign and to step aside.

ROESGEN: That's Lieutenant Governor Pat Quinn on deck to take over. And if Blagojevich won't step aside ...

LISA MADIGAN, ILLINOIS ATTORNEY GENERAL: I am prepared to take action.

ROESGEN: Illinois Attorney General Lisa Madigan says if the governor won't quit, she'll take the standoff to court.

MADIGAN: I have the opportunity to actually go to our Illinois Supreme Court and ask them to basically that our governor is unable to serve and put in lieutenant governor as the acting governor.

ROESGEN: The state legislature will hold a special session Monday and could begin the process of impeachment. Normally impeaching the governor would be a tall order. But now even the neighbors want him to go.

JOHN POWELL, NEIGHBOR: If I saw him walking down the street I'd say you should resign.

ROESGEN: And with newspaper headlines screaming for the governor's head, Illinois lawmakers are under intense pressure to get him out as soon as possible.

(on camera): If the lieutenant governor does take over he says he's going to move right away to fill the Senate seat left by President-Elect Barack Obama. He says normally he would have Illinois voters make that choice, but he says he wants to do it right away, because he says the position is too important to leave only.

Susan Roesgen, CNN, Chicago.

(END VIDEOTAPE)

COLLINS: President-Elect Barack Obama says he's talking to his staff about possible contact with the Illinois governor. Obama told reporters yesterday he never spoke to the governor about the Senate selection. And he said none of his aides were part of any deal making.

We've been talking for a couple days now about severe weather across the country. In particular, this morning, kind of a weird story coming out of Maryland. In fact Upper Montgomery County where there's apparently a ferry that is stuck along the Potomac River because of all of this debris from a storm there.

Rob Marciano is standing by to talk about more first I want to first show you a report that came in from one of our affiliates. WJLA. Let's listen for just a moment.

(BEGIN VIDEO CLIP)

ALISA PARENTI, NEWS CHANNEL 8: Back live, but not in recent memory have we had a situation like this, where we've got rescue crews in boats, approaching the ferry, getting ready to evacuate those people who are trapped on board with their vehicles. A real small trek - a real small distance across the Potomac across this juncture, but large enough they're stuck out there now with all of the debris that hung up on the cable.

So that's the very latest, Bruce, not a situation where there is any concern, people are safe on the ferry, and moving to evacuate them off that ferry, but they are taking a lot of extra precautions on the Virginia side as well to make sure this operation stays safe.

Reporting live, Alisa Parenti, News Channel 8.

(END VIDEO CLIP)

COLLINS: Once again, there Lisa was reporting for WJLA. This is the situation outside of Poolesville, Maryland. Rob Marciano is standing by and boy, when you get a storm there trees and all kind of stuff goes into the river and then the ferryboats -- there are about 20 people out there now so they're trying to make sure everybody is OK.

I'm getting new information coming out too that we'll continue to stay on top of.

MARCIANO: You can see how brown, how swollen that river is. They got a ton of rain. Didn't have a whole lot of wind, not a whole lot of severe weather but a ton of rain.

(WEATHER REPORT)

COLLINS: Yes, right not be the situation, though, in Rome, I know you know about this story, Rob. Under water in Rome. Residents in danger of a river bursting its banks. We're going to have a live report.

(COMMERCIAL BREAK)

COLLINS: A violent face-off in Athens, Greece. Thousands of high school students and college students take to the streets protesting the fatal shooting of a teenager last week. Several students threw rocks at riot police. Officers quickly moved in, firing tear gas and detaining demonstrators.

Until now police have been taking a relatively hands-off approach during days of rioting. Justice Ministry officials say the riots will not delay plans to release about 5,000 prisoners beginning this month. Authorities announced a release after inmates staged a mass hunger strike to protest overcrowding.

Rome, Italy now bracing the possibility of massive flooding. Officials say the Tiber River could break its banks. After days of stormy weather. I want to go live now to CNN's Rome bureau chief Alessio Vinci.

So Alessio, what's the situation right now?

ALESSIO VINCI, CNN ROME BUREAU CHIEF: Well, Heidi, it's been more than 40 years since Rome experienced this type of emergency. And indeed officials here, emergency officials are on high alert. The are monitoring the River Tiber which runs through Rome. The river has already swollen significantly over the past two days due to torrential rains in this region. And they are monitoring now the rise in the levels of the river of about two inches every hour.

That may not sound a lot to you. However they're saying this rise is constant and also saying there's a 50 percent chance the river could break its banks by the end of today. Several hours from now.

So the situation is critical, but they are also saying that it is under control, because they've had to have plenty of time to prepare for it, and indeed we're seeing hundreds of police officers, hundreds of volunteers preparing, they are bringing sandbags, the police blocking bridges, the pedestrian bridges, preventing people from walking down below the banks of the river and we also saw some of the fire brigades going around with amphibious vehicles, so they are clearly preparing for the worst but they want to make sure that they are ready for it.

And indeed, Rome's mayor urged those Roman residents, those who can, to stay at home, not leave their homes but so far we have not received any reports of any kind of evacuations yet, Heidi.

COLLINS: All right. Well, let us know if we have to come back to you, Alessio, certainly if the situation there changes rapidly. Looks like it certainly is. Thanks very much live coming to us from Rome today, Alessio Vinci.

The man responsible for keeping illegal aliens out of the country may have had them working in his home.

(COMMERCIAL BREAK)

COLLINS: Quickly now we're just getting some live pictures in from WJLA there, Montgomery County, Maryland. We've been telling you about this commuter ferry that is stranded. Now you can get a really good idea of why, see all that debris there, all the branches and mud and guck (ph) from the storms that have been hitting the area. Looks like they're getting closer to shore now.

Apparently there's about 20 people on board. This is the White Ferry again on the Potomac River, obviously helps people to get to work every day. So again just a few feet from shore there and they will be offloading those people and eventually their vehicles as well. Again, those live pictures from our affiliate there, WJLA.

Something else we're watching closely today. In just a few minutes we'll be hearing from the United Auto Workers. You see them getting ready for this press conference that will be taking place. We'll hear from the president, Ron Gettelfinger, who you're probably familiar with after the bailout hearings that have been going on. And so he was obviously there with the heads of the Big Three auto companies as well. Bring that to you as soon as it happens in about seven or eight minutes or so.

Earlier this year Homeland Security Secretary Michael Chertoff fired the company that cleaned his house. The problem was not with the work, but the workers.

Here now, CNN's Jeanne Meserve.

(BEGIN VIDEOTAPE)

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT (voice-over): Michael Chertoff is responsible for keeping illegal aliens out of the country. But it turns out he might not have been able to keep them out of his house. The company that cleaned his home for three years has been fined almost $23,000 for filing faulty paperwork on some of its employees. And an investigation showed some workers were using fraudulent documents.

A Homeland Security official says the owner, James Reid, quote, "was fully aware he was employing unauthorized workers" even though Chertoff and his wife had been quote "extremely blunt and clear" that Reid was not to hire them or sent them to the Chertoff property.

JAMES REID, CONSISTENT CLEANING SERVICES: The dispute is I didn't fill out the document I received, list A, list B.

MESERVE: James Reid admits his paperwork was out of order, but claims he looked at his employee's documentation, provided it to the government and never knowingly fired illegal aliens. It is an employers' responsibility to check the legal status of its workers but Reid did not participate in e-verify, a voluntary federal program advocated by Chertoff that let's businesses check employees electronically.

Reid says he did, however, give his employees' paperwork to the Secret Service every time they went to the Chertoff home. If there was a problem with his workers' legal status, he says the Secret Service should have caught it.

REID: The problem is the Secret Service failed to do its job. And they're going to use me as a scapegoat.

MESERVE: The Secret Service says it does security checks, not immigration checks. That is the job of another DHS agency, Immigrations and Customs Enforcement.

When ICE did eventually question Reid, he says he was shocked to find out ICE didn't he was working for Chertoff.

REID: Here you've got the head, Secret Service, the arm, ICE, the other arm and one arm doesn't know what the head is doing. You put all three of these together and let them communicate maybe somebody is going to know something. Maybe they can figure something out in this country.

MESERVE (on camera): There is no indication that Michael Chertoff knew unauthorized workers might be working in his house. And it's not clear that any actually were. Although Reid has not been charged with hiring illegal aliens, publicity about the case has cut his business by 70 percent. And we don't know who is cleaning for the Chertoff's now. But it's probably a safe bet that their immigration status has been checked and checked again.

Jeanne Meserve, CNN, Washington.

(END VIDEOTAPE)

COLLINS: Quickly now we are watching Detroit because in just a couple minutes we are expecting the UAW to hold a news conference. We are going to be hearing from the president of UAW, Ron Gettelfinger, again coming to us in Detroit in just a couple of minutes. We'll bring it to you when it happens.

(COMMERCIAL BREAK)

COLLINS: Stepping in to save Detroit, the White House now signaling it may pick up the financial lifeline the Senate dropped.

Wall Street feels the automakers pain into early trading. We're going to see if that White House remedy provides any relief.

It is Friday, December 12th. Hi, everybody, I'm Heidi Collins. You're in the CNN NEWSROOM.