Return to Transcripts main page
CNN Newsroom
More Layoffs as Companies Reach `Last Resort" Cost-Cutting; Blagojevich Scandal
Aired January 26, 2009 - 10:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
HEIDI COLLINS, CNN ANCHOR: A recession ripple effect hits thousands more workers today. Home construction slowdown leads to Home Depot and Caterpillar layoffs.
Plus, putting a stamp on policy. Live from the White House, President Obama announces shifts on energy and the environment.
It's Monday, January 26th, I'm Heidi Collins, you are in the CNN NEWSROOM.
The nation's battered economy and a new bobby blow to many American families. Over the past couple of hours we've learned of massive new job cuts. Tens of thousands of paychecks are disappearing as companies struggle to survive. CNN's Christine Romans joins us now with a closer look at these grim developments.
Christine, we've been talking for a long time about a lot of companies having this be a last resort, actually cutting the jobs and cutting their expenditures in other ways.
CHRISTINE ROMANS, CNN CORRESPONDENT: That's right. And for many of us, last resort is now here. Why are we hearing this now, Heidi? It's because its earnings reporting season. So many of these companies are coming out with their report on the fourth quarter. How they did? What their revenue was? What their profit was and what they expect for 2009?
And because the outlook is so grim or at least uncertain, companies are saying they're having to layoff workers. Among them Caterpillar, it started the year as a blockbuster year for Caterpillar, really. And then things changed quite quickly. And this company says while it is optimistic - James Owen, the CEO there, says it is optimistic about the stimulus and what the governments around the world have been trying to do, it's just too uncertain in 2009 and they're cutting 20,000 workers.
Sprint Nextel is cutting 8,000, announcing that this morning. Also within the last couple of hours, Home Depot says it is cutting 7,000 workers. It's closing its Home Depot Expo stores, some 34 of those and some other concepts that weren't really its core, Orange Big Box Store.
In terms of how you're going to notice a difference at Home Depot, those will not be their Home Depot front line people that you talk to. Those are not the people losing their jobs, but other people in the business. And also John Deere laying off 700. We just heard that the oil services company Sclumberger is laying off 5,000 workers.
So it's coming in dribs and drabs. The steady, steady list of companies, Heidi, that are cutting jobs from what they've seen in the fourth quarter and also what they see when they're looking forward. They just are cutting the head count.
COLLINS: Yes and speaking of looking forward, there's a sign the recession is getting worse? I mean, clearly not a sign that things are getting better, at least not right now.
ROMANS: Well, this is a good survey here we've got a business economists. So these are the economists who don't work in academia, who don't work in think tanks, who don't work in government. These are the people who work at the companies and the industries. And this is what they're saying. 39 percent say they expect their industry to have more job cuts in the next six months. 47 percent say demand is falling. A majority of all of these business economists say that they expect companies to continue to layoff workers or to not hire workers and indeed to hoard money, to hoard their cash to keep the money in the bank and not spend it on, you know, on technology and on expansion, that they're just trying to kind of hunker down here for the near term.
So that's what the people who are advising CEOs, these are the economists who are right there in business and that's what they see going forward.
COLLINS: Yes, understood. All right. CNN's Christine Romans. Thank you.
And more big job cuts also coming from Global Bank and insurance provider ING Group. The Dutch company says it is slashing 7,000 positions and its CEO is stepping down after posting its first ever quarterly profit loss.
Quick check of the Dow, once again, up positive three digits now. As you can see, the Dow Jones industrial averages up about 110 points or so. We'll continue to watch those numbers and hope they stay that way throughout the day.
A quick look at day seven now for the Obama administration. This morning, the president took part in a daily economic briefing and, as we've been saying, he'll make remarks just minutes from now on jobs, energy independence, and climate change. Then at 1:30 Eastern, the daily White House briefing by press secretary Robert Gibbs.
Fixing the economy, it is job one for president Obama but will lawmakers agree to his massive recovery plan? That debate heating up as the vote draws near. CNN's congressional correspondent, of course, Brianna Keilar on Capitol Hill now to set the stage for us. And that's true, as we get closer to the vote, tensions rise.
BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: Yes, tensions rising, President Obama is dealing with the divided Congress here today, Heidi. House republicans not on board with this economic stimulus package. And there is a vote scheduled or expected to happen on Wednesday. This package, $825 billion, 1/3 of it is tax cuts, 2/3 of it is spending, infrastructure and other projects, and you have House republicans saying that's not enough tax cuts, that's too much on spending. They're now seizing on certain spending projects calling it pork, you know, money for the National Endowment for the Arts money, money for the improvement of the National Mall. And summing it all up yesterday was House republican leader John Boehner.
(BEGIN VIDEO CLIP)
REP. JOHN BOEHNER (R), GEORGIA: Our concerns about the plan we see from democrats on Capitol Hill is just, it has an awful lot of wasteful spending and slow-moving spending. That won't create jobs and won't help preserve jobs in America.
(END VIDEO CLIP)
KEILAR: Republicans, though, being very strategic in how they characterize their opposition to the economic stimulus package. They say they are happy to be working with President Obama, they're glad that he's open to their input and they are meeting with him here on Capitol Hill tomorrow, Heidi. But they say congressional democrats are leaving them out of the equation.
Democrats on the other hand say no, that's not the case. We've given you a forum where you can express your ideas. But the fact is, Heidi, this is a democratic majority in the House, in particular where they only need a simple majority and they're wielding that like a big stick.
COLLINS: Oh, yes.
KEILAR: This vote on Wednesday. And at this point republicans saying we're not going to be on board unless you make some major changes and no indications by democrats about what changes they would accept.
COLLINS: And of course, there's also the big issue between democrats or republicans on how fast this money's going to be spent. Because we've heard so much about infrastructure and other projects. The question obviously then, how fast will it be spent on those things?
KEILAR: Republicans say it's not going to be spent fast enough and therefore it's not going to be creating jobs. They're holding up a report by the nonpartisan Congressional Budget Office. It's really an assessment, a partial assessment that came out last week that showed less than half of the spending part of this bill would be rolled out in the next two years.
But now democrats are holding up a letter from Peter Orzag, the president's director of the Budget saying that actually in a year and a half more than 75 percent of the spending money will be rolled out. So it depends who you're talking to, Heidi and what they're pointing to.
COLLINS: Yes, as always, I guess, when we're talking about Washington. Brianna Keilar, thanks so much on Capitol Hill this morning. KEILAR: You're welcome.
COLLINS: Minutes from now, at 10:30 Eastern, you can hear President Obama's remarks on jobs, energy independence, and climate change. We're going to be hearing it live right here in the CNN NEWSROOM.
Illinois Governor Rod Blagojevich makes good on his promise to boycott his impeachment trial. He's actually hundreds of miles away. CNN's Susan Roesgen following the developments from Springfield, Illinois. He said he wasn't going to be there and he's not.
SUSAN ROESGEN, CNN CORRESPONDENT: No, he's not going to be here, Heidi. He is, in fact, making the rounds of the talk shows. OK.
COLLINS: Go ahead, Susan.
(BEGIN VIDEO CLIP)
GOV. ROD BLAGOJEVICH (D), ILLINOIS: They hang me under these rules that prevent due process. They're hanging the 12 million people of Illinois who twice have elected a governor. Now, they may be for or against me, they may like me or not, but the people of Illinois have every right to expect that the decision they've made when they've chosen a governor, if he or she is going to be removed from office, that the process ought to at least have fundamental fairness and have all of the safeguards that our constitution guarantees to all of our citizens.
Whatever happened to the presumption of innocence? It's been nothing but a frenzy to just assume certain allegations are true and then rush me out of office. And I believe because political figures in Illinois are just waiting to get me out of the way to raise the income tax by either 66 percent or 33 percent during a time of economic depression.
(END VIDEO CLIP)
ROESGEN: OK, Heidi, what I was starting to say there is that the governor is not going to be here in Springfield, Illinois, the state capital. He's making the rounds of morning talk shows in New York. He's going to be on "Larry Ling Live" later. He says that this is a sham in his words. He says that there's no way that he could get a fair hearing.
He also says there that he believes that there's some sort of conspiracy against him that other politicians don't like him because he opposes raising taxes, he says. So what's expected to happen now here Heidi is that the state senate will probably will go ahead and kick him out of office. They just need a simple majority. Probably going to hear a few witnesses, take a little bit of testimony. But this thing could be wrapped up in a couple of days and then he will be out of office.
COLLINS: Yes and it's been going on, at least it feels like oh, for so long. Susan Roesgen there for us live this morning, Springfield, Illinois. Thank you, Susan. You can hear the governor's side of the story as Susan was mentioning right here on CNN. He'll be live on "Larry King Live" at 9:00 Eastern.
Minnesota republican Norm Coleman, he isn't giving up his U.S. Senate seat without a fight. He is challenging an election recount that put democrat Al Franken ahead by 225 votes. A three judge panel begins hearing that case today. Coleman's attorneys argue that more than 1/3 of 12,000 absentee ballots rejected on election day, were tossed in air. They also claim some of those ballots were counted twice which worked in Franken's favor.
Living in fear, a community on edge after more than a dozen suspicious fires, but who is behind them?
(COMMERCIAL BREAK)
ANNOUNCER: This is CNN, the most trusted name in news. Now back to the CNN NEWSROOM.
COLLINS: a mystery in a Pennsylvania city has people living in fear. There have been 14 suspected arsons in Coatesville in the last three weeks. Federal authorities have stepped in to investigate. The city has declared a state of emergency. The latest fire, a seven-alarm blaze over the weekend damaged more than a dozen homes.
(BEGIN VIDEO CLIP)
FRANCIS DORSHEIMER, COATESVILLE RESIDENT: So I ran outside and there's like flames shooting off the roof. It must have been like 15 foot flames or higher. It was just unbelievable. All the smoke in the air. You can hardly breathe
(END VIDEO CLIP)
COLLINS: Police think the fires may be part of a gang initiation. The fires claimed the life of an elderly woman and officials say they have cost millions of dollars in damages.
A violent weekend for Miami, Portland, and Wichita. In Miami, two teens killed, seven other people wounded in a street corner shooting. Police say 18-year-old Derrick Gloucester and 16-year-old Brandon Mills were killed Friday night when someone opened fire with an AK-47. Police are asking the community for help to find the gunman.
In Portland, Oregon, two girls killed and seven other people wounded when a gunman opened fire outside an under-21 nightclub. Police say the alleged shooter then shot himself in the head. He remains in critical condition. Investigators believe that it might have been a random act of violence.
In Kansas, a wake at a home in Wichita disrupted by gunfire. Two people were killed, seven others wounded on Saturday night. Police are still searching for suspects.
Rob Marciano standing by right now in the weather center with a major winter storm brewing. It's actually hit some parts of the country already.
ROB MARCIANO, CNN, METEOROLOGIST: Yes, I apologize for giving you my backside there.
COLLINS: No problem.
MARCIANO: We're just starting to see this storm develop. I've got some purple on the map here. Cold air in place, that's been really in place for a good week and a half, it seems, especially the eastern third of the country. And now we're starting to get a mixing of the atmosphere, some energy about to pour out of California, and the four corners region.
And that's going to launch out into the plains and start to get this stew mixed up. So not a good scenario for folks who live anywhere north of Dallas, really, through parts of the Ohio River Valley. So energy coming in from the Gulf of Mexico, moisture over top of that cold air, very shallow layer of cold air. So where that layer is the most shallow, you'll get rain that - or snow that melts and then we'll refreeze at the very lowest layer of the atmosphere.
So snow and winter storm warnings and ice storm warnings in some spots beginning later on this afternoon. Oklahoma City through Springfield, St. Louis, in through Louisville, in some cases like in Arkansas, and through parts of western Tennessee could be a 36-hour event. I want to show you a live shot from Tulsa.
There you go. KOTV. Thanks for that shot there. You're under a winter storm warning with snow and ice to develop here in the next 12 to 24 hours. So brace yourselves, my friends and in during part of this storm, there may be enough lift, enough convective activity to get thunderstorms, rain, freezing as it hits the ground. I mean, that will pile up some ice in a hurry. And we could see anywhere from 1/4 to 3/4 of an inch of ice in spots. That will lay down on the power lines and certainly we're going to see some power outages.
All right. We haven't seen the moisture develop just yet. We're seeing some snow across the Colorado Rockies. Now just starting to see some moisture coming from the Gulf of Mexico. So this will be formulated throughout the afternoon. Here's the temperature profile, 14 degrees in Kansas City. Meanwhile, 41 degrees in Dallas. So you see where that line of warm and cold air is. 32 degrees in Memphis. I think you're going to see a significant icing. Eight degrees in Chicago, and minus five in Minneapolis.
So certainly the cold air in place. We're seeing delays already in Atlanta, mostly because of fog. We'll probably see some delays with wind and snow in Kansas City and Denver and Salt Lake City and Dallas as the rains and low clouds begin to formulate this afternoon.
47 for the high in Dallas, 22 for the high in Kansas City, 43 degrees in Nashville. 30 in New York, the storm as it gets closer to the bigger cities across the i-95 corridor, forecast will get a little bit dicey, might be a situation where you get snow, mixed in with sleet, changing to rain, back over to snow. It really depends on the track of the storm. 61 degrees in Los Angeles after some steady rains the past couple of days. You'll start to dry out later on this afternoon. Heidi, that's the latest from the weather department.
COLLINS: And the report from home, just letting you know, mom is skipping the gym. It's just too darn cold to go outside.
MARCIANO: Come on. Eight o'clock. No, she's tougher than that.
COLLINS: Come on. 10? It hurts, eight, whatever you have up there. All right. Rob, thank you. We'll continue to watch the weather. As you can see it's happening in some unlikely places to be so cold.
Japanese companies asking their workers to be more productive at home. CNN's Kyung Lah on a new effort to boost Japan's low birth rate.
(BEGIN VIDEOTAPE)
KYUNG LAH, CNN CORRESPONDENT: Quitting time at Canon's headquarters, the mad rush isn't just because workers want to head home. Canon shuts off the lights in the entire building and turns off the heat, forcing its employees out at 5:30 twice a week.
UNIDENTIFIED FEMALE (through translator): It's great, we can go home early and not feel ashamed says its employee.
LAH: But this is not just a cost-cutting measure. Canon is trying to get its employees to make more babies.
UNIDENTIFIED MALE (through translator): We have a very strong birth planning program, says Canon's spokesman, and sending workers home to be with their families is one part of it.
LAH: Canon is among roughly 1,300 companies sending workers home early. Japan is one of the lowest birth rates in the world. 1.34 according to the government. Well below what's needed to maintain the population. Part of the problem, the average 12-hour workday.
LAH (on-camera): It's just about 6:00 on a Friday night, and here's what you'd typically see in Tokyo's downtown offices. All those employees there still working away, no quitting time in sight. Suggesting that an employee go home early is just not the Japanese way.
LAH (voice-over): Three-year-old Jinta is living the more typical Japanese life. Days and nights spent playing with the neighbor and his mother because his dad is always working.
I can't make my son a brother or a sister, says his mother because his dad is never home. The session has made life worse for families like Jinta's. Layoffs mean fewer employees to do the same amount of work which translates into longer workdays.
But at Canon, no such complaints. These employees say even in the gloomiest of economic storms, there can be life at the end of the tunnel. Kyung Lah, CNN, Tokyo.
(END VIDEOTAPE)
COLLINS: A young Brazilian model dies after trying to fight off a little known disease. What went wrong?
(COMMERCIAL BREAK)
COLLINS: Funeral services have already been held for 20-year-old Brazilian model Mariani Bridi Acosta. She died Saturday after her hands and feet were amputated in a bid to save her life from a little known illness called septicemia. CNN's senior medical correspondent Elizabeth Cohen here now to explain a little bit more about this. Some people may have heard of it if they have a lot of hospital stays - pardon me, just the microphone, but in case they haven't, what exactly is septicemia? How do you get it?
ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: You know some lay people call it blood poisoning. People may be familiar with that term. Septicemia is a rampant infection in the blood that then spreads to the organs, you get multi-organ failure and it often starts out as let's say a urinary tract infection as in her case or a skin infection or pneumonia that just sort of gets out of hand and you get this cascade of infections and it can happen very, very quickly, sometimes in a matter of hours.
COLLINS: Yes. And that's the thing, at least my understanding is that as you said, it spreads so fast. There's almost nothing that doctors can do to stop it, right?
COHEN: Well, there's not nothing. I mean, they give antibiotics and they give support. They give intravenous fluids and all of that in order to stop it. And sometimes it works and sometimes it doesn't. But I definitely want to make the point that you know, Miss World or I'm sorry that this Brazilian model was very young.
COLLINS: Yes,
COHEN: She was 20 years old, you can see here, she was a very healthy woman. This happened very, very quickly. And I asked several experts on this disease how common is this to happen to someone so young and healthy? And they say very, very uncommon. They say we see this all the time with very old people, with little tiny babies, people who have immune problems. But to see it in someone like her is very unusual.
COLLINS: Yes. Well, when do you get worried, then? I mean, if you are in a hospital bed or you're being treated for something else and they start saying that word septicemia, what do you do?
COHEN: Well, you said something very important right there. Which is that if you have a loved one in the hospital for something completely unrelated to an infection, but let's say they have a wound in their skin, and it becomes infected, you want to make sure that you keep an eye out. Is it advancing, is this person developing a fever? Are they becoming confused? And really just work with the doctors to follow that. Because that can happen.
I mean, people do sometimes go into the hospital for let's say a broken ankle and develop septicemia because a lot of horrible germs lurk at hospitals. So it's definitely something you want to keep an eye on if someone you love is in the hospital with any kind of an infection, urinary tract infection, pneumonia, skin infection. Work with doctors to make sure it doesn't escalate.
COLLINS: Wound care.
COHEN: Right, exactly.
COLLINS: That's what we call that. All right. CNN medical correspondent Elizabeth Cohen. Elizabeth, thanks.
That's a tragic story.
Just a few minutes from now, President Obama unveils a green agenda. He'll talk about jobs on a day when thousands more Americans see their paychecks slip away.
(COMMERCIAL BREAK)
COLLINS: President Obama going green and the automotive industry may be forced to follow. At any moment now, the president will unveil tougher standards for what you and I drive. Among the likely changes, giving states more authority to crack down on emissions and then pushing the government to demand greater fuel efficiency standards. Those changes could reshape the auto industry.
President Obama has made renewable energy a center piece of his plan to get America's economy working again. And this hour, he is expected as we've said to announce new policies on energy and the environment. Cnnmoney.com's Poppy Harlow is here now with more on this and our energy fix this morning. This is right up your alley, Poppy.
POPPY HARLOW, CNN CORRESPONDENT: Yes, it is, Heidi. A big announcement expected in just a few minutes from President Obama. We all know he's pledged to create five million new green jobs by investing $150 billion in clean energy over the next 10 years, the U.S. economy desperately needs that news.
Just this morning, Heidi, we've been telling you about more layoffs. Thousands of layoffs coming in this morning. We're scheduled to hear from Obama in just a few minutes. And he is expected to ask the EPA to allow California along with 13 other states to set their own fuel economy and emission standards. He's also expected to order federal agencies to find some new ways to save energy and to highlight the energy-related components of that whopping $825 billion stimulus package proposed by House democrats. Heidi?
COLLINS: Yes, I mean, automakers have long opposed, though, these emissions and fuel economy standards. So what does it mean for the car companies who we know, or at least the American car companies who are in deep, deep trouble right now.
HARLOW: That's exactly right. It could be a major change for them. If the EPA does sign off on these tougher state by state standards, the automakers are not going to have any choice but to start building cars that meet those standards. This is really going to be a focus in California.
That's a critical state for the auto industry in terms of sales. And they have really strict standards already. Now the company's claimed it will force them to produce different sets of vehicles to meet every state's individual requirements. They say we just can't afford to do that especially right now. Remember, Heidi, GM and Chrysler were literally on the brink of collapse last year before they got billions of dollars in aid from the federal government.
And if the car companies have to meet these different standards, the critics say the costs, Heidi, will ultimately get passed down to you and me. And American consumers aren't in a place, a lot of people would argue, to take that right now, either. This comes on the heels of a year last year when auto sales hit a 16-year low. So you can bet, Heidi, we know one thing, the heads of the big three automakers are going to be listening very closely to what Obama has to say in just a few minutes -- Heidi.
COLLINS: Yes, definitely. And I guess the other question that's out there must be that if these standards are getting so much tougher, then the pollution must be worse? Or it sounds like there's new research to show that. Or is there any indication that is what he's acting on?
HARLOW: You know, it's interesting because he hasn't talked as much about that. But we just got an e-mail, actually, from the Environmental Defense Fund offering us reaction to what he has to say. We're going to put a call into them after we hear what Obama has to say and really look at what's driving this. Because it's got to be more than just the numbers there, Heidi.
COLLINS: Yes, all right, very good. We'll watch that, and we'll be watching him in just a couple minutes, I'm hearing. Poppy Harlow, great, thank you, appreciate that.
HARLOW: You're welcome.
COLLINS: Our "Energy Fix" today.
Meanwhile, it is day seven for the Obama administration. Here's a look now at the schedule. Early this morning, earlier I should say, the president did take part in his daily economic briefing. As we've been saying, he's due to make remarks any moment now. Watching the monitor for you. The topics jobs, energy independence and climate change. And then, a little bit later on, 1:30 Eastern, the daily White House press briefing by press secretary Robert Gibbs.
Here's a new position for the Obama administration, a special envoy for climate change. Senior State Department officials tell CNN Secretary of State hillary Clinton will make that announcement this afternoon. The appointee, former White House assistant Todd Stern. He was also the chief U.S. negotiator at the Kyoto protocol talks during the Clinton administration. Stern's appointment adds urgency to President Obama's promise to make climate change a foreign-policy priority.
President Obama's Cabinet likely to get a new member today, as well. The Senate appears ready to confirm that man, Timothy Geithner, as the nation's new treasury secretary. That's despite embarrassing disclosures that he initially failed to pay $34,000 in back taxes until learning of his nomination for the post. Supporters say Geithner is the perfect person to spearhead the nation's economic recovery.
Susan Rice getting down to business today. The new U.S. ambassador to the U.N. seen here doing her confirmation hearing earlier this month is scheduled to start work. She'll present her credentials to Secretary General Ban-ki Moon. Rice is a specialist on African issues. She will likely be a key player in deciding whether to send peacekeeping troops to Somalia.
Quickly just want to let you know that we are awaiting President Obama to come to the podium. Actually there he is. This is his comments on the economy, climate, and energy.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Thank you so much. Thank you. Thank you, everybody. Thank you. Please, everybody be seated. Thank you.
Good morning. Before I begin today's announcement, I want to say a few words about the deepening economic crisis that we've inherited and the need for urgent action. Over the last few days, we've learned that Microsoft, Intel, United Airlines, Home Depot, Sprint Nextel and Caterpillar are each cutting thousands of jobs. These are not just numbers on a page. As with the millions of jobs lost in 2008, these are working men and women whose families have been disrupted and whose dreams have been put on hold.
We owe it to each of them and to every single American to act with a sense of urgency and common purpose. We can't afford distractions, and we cannot afford delays. And that is why I look forward to signing an American recovery and reinvestment plan that will put millions of Americans to work and lay the foundation for stable growth that our economy needs and that our people demand. These are extraordinary times, and it calls for swift and extraordinary action.
At a time of such great challenge for America, no single issue is as fundamental to our future as energy. America's dependence on oil is one of the most serious threats that our nation has faced. It bankrolls dictators, pays for nuclear proliferation and funds both sides of our struggle against terrorism. It puts the American people at the mercy of shifting gas prices, stifles innovation and sets back our ability to compete.
These urgent dangers to our national and economic security are compounded by the long-term threat of climate change, which if left unchecked could result in violent conflict, terrible storms, shrinking coastlines and irreversible catastrophe. These are the facts. And they are well-known to the American people. After all, there is nothing new about these warnings.
Presidents have been sounding the alarm about energy dependence for decades. President Nixon promised to make our energy -- our nation energy-independent by the end of the 1970s. When he spoke, we imported about a third of our oil. We now import more than half. Year after year, decade after decade, we've chosen delay over decisive action. Rigid ideology has overruled sound science. Special interests have overshadowed common sense, rhetoric has not led to the hard work needed to achieve results, and our leaders raise their voices each time there's a spike in gas prices only to grow quiet when the price falls at the pump.
Now America has arrived at a crossroads. Embedded in American soil and the wind and the sun, we have the resources to change. Our scientists, businesses and workers have the capacity to move us forward. It falls on us to choose whether to risk the peril that comes with our current course or to seize the promise of energy independence. And for the sake of our security, our economy and our planet, we must have the courage and commitment to change.
It will be the policy of my administration to reverse our dependence on foreign oil while building a new energy economy that will create millions of jobs. We hold no illusion about the task that lies ahead. I cannot promise a quick fix. No single technology or set of regulations will get the job done.
But we will commit ourselves to steady, focused, pragmatic pursuit of an America that is freed from our energy dependence and empowered by a new energy economy that puts millions of our citizens to work. Today, I'm announcing the first steps on our journey toward energy independence as we develop new energy, set new fuel-efficiency standards and address greenhouse gas emissions.
Each step begins to move us in a new direction while giving us the tools that we need to change. First, we must take bold action to create a new American energy economy that creates millions of jobs for our people. The American recovery and reinvestment plan before Congress places a down payment on this economy.
It will put 460,000 Americans to work with clean energy investments and double the capacity to generate alternative energy over the next three years. It will lay down 3,000 miles of transmission lines to deliver this energy to every corner of our country. It will save taxpayers $2 billion a year by making 75 percent of federal buildings more efficient. And it will save working families hundreds of dollars on their energy bills by weatherizing 2 million homes.
This is the boost that our economy needs and the new beginning that our future demands. By passing the bill, Congress can act where Washington has failed to act over and over again for 30 years. We need more than the same old empty promises. We need to show that this time it will be different. This is the time that Americans must come together on behalf of our common prosperity and security.
Second, we must ensure that the fuel-efficient cars of tomorrow are built right here in the United States of America. Increasing fuel efficiency in our cars and trucks is one of the most important steps that we can take to break our cycle of dependence on foreign oil. It will also help spark the innovation needed to ensure that our auto industry keeps pace with competitors around the world. We will start by implementing new standards for model year 2011 so that we use less oil and families have access to cleaner, more efficient cars and trucks. This rule will be a down payment on a broader and sustained effort to reduce our dependence on foreign oil. Congress has passed legislation to increase standards to at least 35 miles per gallon by 2020.
That 40 percent increase in fuel efficiency for our cars and trucks could save over 2 million barrels of oil every day, nearly the entire amount of oil that we import from the Persian Gulf. Going forward, my administration will work on a bipartisan basis in Washington and with industry partners across the country to forge a comprehensive approach that makes our economy stronger and our nation more secure.
Third, the federal government must work with, not against, states to reduce greenhouse gas emissions. California has shown bold and bipartisan leadership through its effort to forge 21st-century standards, and over a dozen states have followed its lead. But instead of serving as a partner, Washington stood in their way. This refusal to lead risks the creation of a confusing and patchwork set of standards that hurts the environment and the auto industry.
The days of Washington dragging its heels are over. My administration will not deny facts. We will be guided by them. We cannot afford to pass the buck or push the burden on to the states. And that's why I'm directing the Environmental Protection Agency to immediately review the denial of the California waiver request and determine the best way forward. This will help us create incentives to develop new energy that will make us less dependent on the oil that endangers our security, our economy and our planet.
As we move forward, we will fully take into account the unique challenges facing the American auto industry and the taxpayer dollars that now support it. And let me be clear: Our goal is not to further burden an already struggling industry. It is to help America's auto makers to prepare for the future. This commitment must extend beyond the short-term assistance for businesses and workers. We must help them thrive by building the cars of tomorrow and galvanizing a dynamic and viable industry for decades to come.
Finally, we will make it clear to the world that America is ready to lead. To protect our climate and our collective security, we must call together a truly global coalition. I've made it clear that we will act, but so too must the world. That's how we will deny leverage to dictators and dollars to terrorists, and that's how we will ensure that nations like China and India are doing their part, just as we are now willing to do ours.
It is time for America to lead because this moment of peril must be turned into one of progress. If we take action, we can create new industries and revive old ones. We can open new factories and power new farms. We can lower costs and revive our economy. We can do that, and we must do that. There's much work to be done. There is much further for us to go.
But I want to be clear from the beginning of this administration that we have made our choice. America will not be held hostage to dwindling resources, hostile regimes and a warming planet. We will not be put off from action because action is hard. Now is the time to make the tough choices. Now is the time to meet the challenge at this crossroad of history by choosing a future that is safer for our country, prosperous for our planet and sustainable.
Those are my priorities, and they're reflected in the executive orders I'm about to sign. Thank you so much for being here.
(APPLAUSE)
COLLINS: Once again, if you're just tuning in, I want to let you know what you're looking at here. President Obama signing his executive orders. Just giving a speech about the economy, energy and the environment, as you see on your screen. Talking a whole lot about the independence on foreign energy and the jobs that he says will be created by the recovery plan that he has been talking about, of course, with congressional leaders for quite some time now.
We are going to take a very quick break here. We're back in just a moment in the CNN NEWSROOM.
(COMMERCIAL BREAK)
COLLINS: The business week gets under way with a big merger between two drug companies. Pfizer has reached out -- has reached an agreement, I should say, to buy its rival, Wyeth. The estimated value of the deal? Roughly $68 billion. Pfizer is the world's leading drugmaker in terms of sales.
Even before the opening bell on Wall Street, tens of thousands of new job cuts were announced. Susan Lisovicz is on the floor of the New York Stock Exchange with a look at the latest companies to shrink the size of their payrolls. And that, well, Miss Susan, we have to the positive by about 120 points at the Dow.
SUSAN LISOVICZ, CNN CORRESPONDENT: Not a bad start to the day. But if you work for some of these companies, it's one of the worst days of the year, no question about it. You know, this is one of the reasons why President Obama was talking about jobs, saving them, creating them.
Huge companies are cutting. Some of them are bellwethers for the economy. Let's start with Caterpillar, which is slashing 20,000 jobs. You know, Cat actually reported record sales for last year, but you know, what happened was we really saw a global recession in the last quarter. You know, Caterpillar was getting through with the U.S. recession, and it was seeing demand overseas. But when you have all of the demand dry up, that's when you have to take drastic action.
Sprint Nextel and Pfizer cutting 8,000 jobs each. Pfizer is closing five manufacturing sites, and it comes, as you mentioned, that pfizer is buying its rival drugmaker, Wyeth, for $68 billion. Home Depot, bad time to be in retail, especially if it has anything to do with home improvement and building homes, things like that. It's cutting 7,000 jobs. It's closing more than 40 of its design stores. And Schlumberger, which is in the oil-services business, 5,000. Deere & Co. -- they're sort of in the earth-moving business, tractors, things like that -- 5,000 jobs, Heidi. It's a long litany of names from all sorts of different sectors.
COLLINS: Yes. No question about that. It really stinks for the people who are losing their jobs. But even for those who still have a job, things are tough.
LISOVICZ: That's right, I mean, I think we're all feeling it. All of us are feeling that in lots of different ways. Sprint is suspending its 401 match for this year, suspending its tuition reimbursement program. Think about how important that is.
Home Depot is putting a salary freeze on a lot of its officers. Caterpillar says it's slashing executive pay by up to 50 percent, and it has instituted a global hiring freeze.
Why is this all happening right now? Well, we're in the midst of earnings season. This is when we get to see the quarterly report card, you know, a check of the fiscal health for, you know, lots of big companies. And the fourth quarter was terrible. Pfizer, Schumberger among them that posted weak earnings.
But let's keep it in perspective. Caterpillar said it's important to remember that economic cycles aren't new. Caterpillar itself managed to get through the Great Depression, several recessions, a world war, and numerous other adversities. And it says, when the economy does recover, the need for better housing, roads, and capacity for energy and miningg will still be there, and we'll be prepared to respond.
And this is what the president's talking about. He's talking about stimulus, roads, bridges, you know, new energy, you know, alternative sources of energy. And if it works, it'll create jobs. That's important to remember.
What we're also, we should also keep in mind is that we do have a rally here on Wall Street today. We've got good news from the housing sector, Heidi. We had existing home sales jump 6.5 percent. The National Association of Realtors says housing affordability is the best it's seen since 1973. So, if you can get a loan, buy a place...
COLLINS: Yes. Definitely.
LISOVICZ: Because they're cheap.
COLLINS: And some of those rules, of course, loosening up just a tad. Some of that credit. So people hopefully are able to do some of that homebuying.
LISOVICZ: Yes. If you can get credit, and you bring the inventory down and people are buying homes, it's going to improve that sector. And what's also cheap by a lot of folks' standards are stocks. The Dow Industrials (INAUDIBLE) buying up 120 points or 1.5 percent. The Nasdaq's up 2 percent. Good start to this Monday. Heidi, back to you.
COLLINS: All right. Susan Lisovicz, thank you.
LISOVICZ: You're welcome.
COLLINS: Facebook taking down some pictures of women breast-feeding, and that's prompting tens of thousands of moms to take up a cause.
(COMMERCIAL BREAK)
COLLINS: The social-networking site Facebook is banning some pictures of women breast-feeding, and that is causing some moms to push back. CNN's Kara Finstrom has the story now. We've blurred some of the pictures because this is a piece for television and not a Facebook page on the Web.
(BEGIN VIDEOTAPE)
FINSTROM (on camera): So, show me some of these pictures that are at issue here.
(voice-over): Photographs of women breast-feeding, natural or obscene? The answer depends on who you ask. The question is putting Facebook, the social networking Web site, in an uncomfortable place.
PROFESSOR DMITRI WILLIAMS, UNIVERSITY OF SOUTHERN CALIFORNIA: If they're playing the role of community police, they have to try to respect the will of the majority while protecting the minority, and that's a tough line to walk.
FINSTROM: USC Professor Dmitri Williams is talking about Facebook's ban and removal of certain breast-feeding pictures.
(on camera): Is it hard keeping up with this?
KELLI ROMAN, BREAST-FEEDING ACTIVIST: Yes, it is.
(voice-over): Young mom Kelli Roman is leading an online protest asking other mothers to post their breast-feeding pictures.
ROMAN: It's a Facebook group called Hey, Facebook, Breast-Feeding is not Obscene. And when we first started, we only had a few hundred members, but within a couple weeks we had, like, 20,000.
FINSTROM: For Roman, it's about changing the cultural norm.
ROMAN: As long as pictures of women breast-feeding are still classified as obscene, there are still going to be those small percentage of people who think it's nasty and obscene and going to send people dirty looks and messages.
FINSTROM: Breast-feeding group La Leche League says it's used Facebook as an educational tool.
LORETTA MCCALLISTER, LA LECHE LEAGUE: We actually have had had to have photos specifically to show positioning. That kind of picture would help some mother that maybe lives out in a rural area, has Internet connection, but doesn't have mothers in our community to go and talk to.
How am I going to show that with being all covered?
FINSTROM: Professor Williams says Facebook's actions aren't so much about censorship as about a new commercialism.
WILLIAMS: The content of Facebook isn't made by a Hollywood studio or a production crew, it's made by the users of Facebook, itself. In essence, the company makes money by selling the people to each other. And if the people don't behave to each other that everyone would like to, the company can lose money.
FINSTROM: Facebook's management refused CNN's request for an interview but did offer a statement saying in part, "We agree that breast-feeding is natural and beautiful " and "We take no action on the vast majority of breast-feeding photos because they follow the site's Terms of Use. Photos containg a fully exposed breast do violate those Terms."
Facebook also says almost all photos banned were flagged by complaining users. Roman just wants to promote breast-feeding. But she's also testing the boundaries of Internet authority and a growingly Web-connected world.
Kara Finstrom for CNN, Los Angeles.
(END VIDEOTAPE)
COLLINS: Children trained to kill. The man accused of organizing it faces charges today in a first-of-its-kind trial.
(COMMERCIAL BREAK)
COLLINS: An historic trial got underway at the International Criminal Court at the Hague today in the Netherlands. The prosecution of a former militia leader, who's charged with making soldiers out of hundreds of children during the brutal Congolese civil war that ended in 2003. Thirty-four people are expected to testify, most of them with their faces covered. The trial estimated to take months.
I'm Heidi Collins. You can join us again tomorrow morning beginning at 9 a.m. Eastern. For now, CNN NEWSROOM continues with Tony Harris.
