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Recession Aid for the Middle Class; More Signs of Economic Trouble, Quarterly Corporate Losses Drive Huge Layoffs; Obama Denounces Wall Street CEO Bonuses

Aired January 30, 2009 - 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: New sign of troubled times. Key economic gauge drops. What it means for you right now and later this year.

Plus, recession aid for the middle class. The president and vice president mobilize a task force.

It's Friday, January 30th. I'm Heidi Collins. You are in the CNN NEWSROOM.

Well, it's not your imagination. The recession really is getting worse. New proof of that just a few minutes ago. The government says the Gross Domestic Product recorded its worst performance since 1982. The economy shrank at a pace of 3.8 percent last quarter, as consumers and businesses cut their spending even further.

The GDP is considered the broadest barometer of the U.S. economy, because it measures all of the goods and services produced right here in the United States.

The recession deepens. The concerns grow.

Let's get the very latest now from the CNN money team. Christine Romans joins us now from New York with more on this.

Yes, very important to point out exactly what GDP is and why people should care about it.

CHRISTINE ROMANS, CNN CORRESPONDENT: Right. It's the broadest gauge of economic output. It is the economy and it slowed dramatically in the last three months of the year, down 3.8 percent.

We haven't seen the economy slow like that in one three-month period since back in 1982 and that was a very painful time. That's why we always give you that comparison. That was a tough time in the economy. Back in '82, the economy was shrinking by 6 percent. In fact, at its worst point then it was down -- shrinking by 10 percent.

That's very painful. It means millions of jobs lost and the like. So this was the biggest slowdown in 26 years. We knew that it was going to drop off at the end of the year and, in fact, it did.

Here is the slight glimmer of a silver lining. It was an ugly number. It could have been worse.

COLLINS: Yes. ROMANS: A lot of people were expecting 5 percent or 6 percent.

COLLINS: Really?

ROMANS: That would have been indicative of, essentially, parts of the economy kind of shutting down, slowing down, you know, grind to go a halt. It wasn't as bad as many of the economists had been, had been expecting. The consensus forecast, as we like to say, was 5.4 percent for a decline in the quarter. It was 3.8 percent.

It's a bad number, Heidi, but it's not as bad as people had been fearing. What it means for this quarter, however, is what's really important here. That's the rearview mirror.

COLLINS: Yes.

ROMANS: It shows us that we know that things really kind of just stalled in the fourth quarter. And it probably indicates that things are going to be tough for the first quarter as well.

Many times in a slowdown after a big, big decline in GDP, you see a little bit of a rebound. I don't know any economists who are expecting a rebound in this quarter. It's the pace of that decline, how quickly we went from growth in the middle of the year to no growth and then to shrinking at the end of the year. It's a pace of that turnaround that have people concerned for the first quarter -- Heidi?

COLLINS: Yes, absolutely. All right, Christine, we are watching those numbers as well. Thank you.

Your money, your concerns, your questions. Answers are always close at hand, though. Just go ahead and log on to CNN.com. Excuse me, Money.CNN.com, specifically for your finance questions.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: When I saw an article today indicating that Wall Street bankers had given themselves $20 billion worth of bonuses, the same amount of bonuses as they gave themselves in 2004, at a time when most of these institutions were teetering on collapse and they are asking for taxpayers to help sustain them, and when taxpayers find themselves in the difficult position that if they don't provide help, that the entire system could come down on top of our heads, that is the height of irresponsibility.

It is shameful. And part of what we're going to need is for the folks on Wall Street who are asking for help to show some restraint and show some discipline and show some sense of responsibility.

The American people understand that we've got a big hole that we've got to dig ourselves out of, but they don't like the idea that people are digging a bigger hole even as they are being asked to fill it up. And so, you know, we're going to be having conversations as this process moves forward directly with these folks on Wall Street, to underscore that they have to start acting in a more responsible fashion if we are to, together, get this economy rolling again. There will be time for them to make profits and there will be time for them to get bonuses. Now is not that time. And that's a message that I intend to send directly to them.

I expect Secretary Geithner to send to them. And, you know, Secretary Geithner already had to pull back one institution that had gone forward with a multi-million dollar jet plane purchase at the same time as they are receiving TARP money.

We shouldn't have to do that because they should know better. And we will continue to send that message loud and clear.

(END VIDEO CLIP)

COLLINS: President Obama scolding Wall Street executives who are collecting bonuses even as their industry relies on your tax money. He says a crackdown is coming.

Let's take a closer look now with CNN White House correspondent Suzanne Malveaux this morning.

So, Suzanne, what -- what is the president planning to do about these bonuses in particular? And how much money are we talking about here?

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, it's interesting, Heidi. You saw President Obama, really, quite emotional there. I hadn't seen that kind of emotion in 12 months of covering him. Really type of a flash of anger and frustration over this.

Clearly that is a part of what is happening at the White House that he wants to demonstrate that, A, he gets it. He understands the frustration of the American people. This is something that he campaigned on, and that he said, you know, he was going to make sure that these guys, the corporate CEOs were not going to get these huge bonuses that that was an unfair practice.

It was legislation that he signed as senator and essentially has not worked. So what does he do here? He shows that he does get it, but he also has to come up with some action.

We're going to see later this morning, Heidi, he is going to be issuing four executive orders, all of them before a union and labor leaders, obviously, to show that he believes that he's going to strengthen employees' rights when it comes to the unions, that he is also going to be assigning a special middle class task force that is going to be headed by Vice President Joe Biden.

That is something he announced before which simply means that they're going to focus on, are these things working for the middle class? How are they doing? Is his economic stimulus package reaching the people that it needs to reach? Heidi?

COLLINS: Sure. All good questions. And I just wonder, Suzanne, if there's much talk in Washington about, you know, we've been talking a lot here about the pork has been attached to this bill. And, you know, when we talk about these bonuses, you have that chunk of money and then you have even more that's attached to this bill that is much larger sums of money. Hundreds of millions.

People are asking those questions, too?

MALVEAUX: They definitely are asking those questions. You're talking about on the Senate side, an economic stimulus package, a bill that looks like $900 billion that's bigger than what they were debating in the House. So one of the things that they're going to be looking at next week is what can they actually take out of that economic stimulus package that has nothing to do with creating jobs as quickly as possible?

That is really the focus, the mantra of President Obama that he is going to be working with Democrats and Republicans once again to try to see if there are ways and things that they can negotiate so that this is something that is passed and at least get some Republican support.

COLLINS: Yes, more streamlines. All right. Very good, we'll be watching all of that alongside you, CNN's White House correspondent Suzanne Malveaux.

Thanks, Suzanne.

The workweek comes to an end. It's a big week, though, that looms on Capitol Hill. As early as Monday, the Senate will begin debate on President Obama's stimulus plan as you just heard Suzanne mentioned. The $819 billion proposal passed the House this week mostly along party lines. 11 Democrats voted against it, though, along with every single Republican.

Tonight an "ANDERSON COOPER 360" special. Ali Velshi and some of the sharpest minds in money take on the $819 billion stimulus plan. It's a big number, of course. Then you probably got some pretty big questions about it, too, so get the answers at the CNN money summit tonight at 11:00 p.m. Eastern.

Next hour, President Obama is making remarks on middle class working families and their struggles in a sinking economy. We also heard Suzanne mentioned that. So we are going to be taking those comments for you live. It will happen about 10:45 Eastern this morning.

And here's a look at some other things the president is doing today. Later this hour he gets his economic daily briefing. As we mentioned, next hour he'll make those remarks on the middle class working families task force. And this afternoon, the president meets with senior enlisted officials of the U.S. armed forces.

U.S. soldiers killing themselves in record numbers. Why is it happening? And what's being done about it.

ROB MARCIANO, CNN METEOROLOGIST: I'm Rob Marciano in the CNN Severe Weather Center. The ice storm gone but the cold air remains and lots of people still without power. Plus, a 4.6 magnitude earthquake right near Seattle.

All of the details coming up when the CNN NEWSROOM comes right back. (COMMERCIAL BREAK)

COLLINS: Still without power days after a major winter storm spread ice and snow from Texas to Maine.

Here's what we know at this point. More than one million homes and businesses are still in the dark. The storm is blamed now for more than two dozen deaths across nine states. And emergency officials fear that number could rise from, among other things, improper use of generators.

Kentucky and Arkansas are among the hardest hit. Utility crews are out in force in those states. But power company officials say it could be as late as mid February before all customers are back on line.

Rob Marciano is standing by now in the weather center. This has been a story we've been covering now for, I guess, in its fourth day? Is that right? So the storm is gone but it's still so darn cold...

MARCIANO: Yes.

COLLINS: ... that people are having to deal with a lot.

MARCIANO: Yes, and it's just going to get colder.

COLLINS: Yes.

MARCIANO: So that -- that's ice, if at all, will be very slow to melt during the day with the help of sunshine. But even then, temperatures in many spots are hovering near the freezing mark. And there is more cold air on the way.

(WEATHER REPORT)

MARCIANO: All right. I want to touch on this real quick. 4.6 magnitude quake fired up about an hour and a half ago, northwest of Seattle by 20 miles, just revised by the USGS. The depth is not nearly as deep as they used to -- as I first thought at about five miles deep in the middle of the Puget Sound there.

So people felt it, Heidi.

COLLINS: Yes.

MARCIANO: But likely not much in the way of damage or injuries with something of that magnitude...

COLLINS: Yes.

MARCIANO: ... and no tsunami warning issued either so...

COLLINS: Very, very good.

MARCIANO: ... just a little bit of a -- kind of a jolt to get you out of bed, I suppose. COLLINS: Yes. Yikes. Hey, Cardinals or Steelers?

MARCIANO: I'm going with the Cardinals. Who are going for?

COLLINS: Cardinals. So we can't bet.

MARCIANO: Good girl. Cinderella story.

COLLINS: Not that we would bet every or endorse betting.

MARCIANO: Well, you know, I'd do it for your hair, really. It's kind of a cardinal red.

COLLINS: Oh, well, that's very sweet. Rob, we will check back later on.

(LAUGHTER)

MARCIANO: OK.

COLLINS: Stick around, OK?

MARCIANO: All right.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We will probably have some fatalities in all of this. We have some people on the lakes that we can't even cut into to go get.

(END VIDEO CLIP)

COLLINS: Later this hour, you'll see just how critical the situation is in one Kentucky community. Plea -- they are pleading for help from (INAUDIBLE). So we will be talking with some people there.

Meanwhile, another story, to Iraq now. The first ballots have already been cast for early voting in Iraq. But full-scale voting is set for tomorrow and security, as you would imagine, is tight.

Iraqis are choosing governing councils in most of Iraq's provinces. More than 1400 candidates are competing for 440 seats. That voting being closely watched by Washington as it considers how fast to withdraw American forces.

Stressed by war and long tours overseas. U.S. soldiers killed themselves at record high rates last year. Here to talk more about this is Paul Rieckhoff. He's the executive director and founder of the Iraq and Afghanistan Veterans of America.

Paul, nice to see you. Unfortunately, the topic is terrible. These numbers released by the U.S. Army yesterday. Let's go ahead and put some of them on the screen real quick and then we'll talk about it here.

As you can see there, 128 soldiers confirmed committing suicide this year. 2008, I should say. And then there's another 15 that are suspected. They're still pending. When you go all the way back to 2004, in fact, Paul, correct me if I'm wrong, those numbers have doubled?

PAUL RIECKHOFF, IRAQ & AFGHANISTAN VETERANS OF AMERICA: Yes. That's exactly right, Heidi. They've doubled in -- about four years. So this is a really disturbing trend. The number continues to go upward and if you look at the facts on the ground, you can see why. They are doing repeated tours. You got more than 500,000 folks who've been there more than once. You've got family stresses back home. Now you've got the economic situation.

Mortgage foreclosure rates around military rates -- military bases are higher than national average, much higher, and you've got a very, very tough war zone. So all this comes together with an inadequate screening program and not enough mental health support and these numbers are continuing to rise, unfortunately.

COLLINS: In fact, there's another disturbing one, too, that we talked about. Apparently for the first time since the Vietnam War, the amount of soldiers committing suicide is actually higher than the civilian rate.

RIECKHOFF: Yes. That's right. And you've got to take into account that civilians aren't prescreened for mental health disorders.

COLLINS: Sure.

RIECKHOFF: They're generally less healthy physically. They don't have health coverage so this is an even higher number. This doesn't take into account other branches, the Marine Corps and the Navy and folks who've left the military. There are many veterans who will come home, leave the military system, and unfortunately take their own lives. So this is really the tip of a much larger iceberg and a much larger problem.

COLLINS: Yes. And there's two things to talk about here, if you ask me. And one of them is what sort of care the military offers and then exactly what you just mentioned. What sort of care the veteran gets with regard to psychological treatment? And we are talking about PTSD here most times.

RIECKHOFF: That's right. About 1 in 4, 1 in 5 folks coming home are going to face post-traumatic stress disorder and severe depression. They're also facing alcohol and drug abuse, marital problems. So the scope is pretty broad. The army is stepping up efforts. They made a call for increases to mental health hiring.

They actually said in a conference call yesterday we need more folks to work in mental health at the army and we need the president involved, we need Congress involved. If we lost 128 soldiers to an enemy weapon the country would be in outrage. So we've really got to address it with the same kind of urgency and mobilize the country to take care of our folks in harm's way.

COLLINS: And one of those things that you can do is raise awareness, of course. I want to take a moment to show one of these new ads that's out with the Ad Council.

Let's take a look.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Welcome home, man.

(END VIDEO CLIP)

COLLINS: You know it gets me choked up every time I see it. I have seen it several times on television. Is something like that enough? I know there's also the National Intrepid Center of Excellence that is being built in Bethesda. I mean they are going to be talking and working with traumatic brain injury as well as post-traumatic stress disorder.

That's private money, though. I mean where is the emphasis? Where should it be? Should it be from the V.A., the DOD or does it need to be coming from private civilians?

RIECKHOFF: Honestly, Heidi, it's got to be all those things working in concert together. Our program with the Ad Council is designed to reach out to those veterans, get them support, get them involved. There's an online component so if you're a soldier or a veteran or family member in need of help go to CommunityofVeterans.org. We've set that site up.

But the Intrepid Center is also going to be critical. It's something like a $60, $70 million in Bethesda. It will be the premier traumatic brain injury and post-traumatic stress disorder, research and care facility in the country. But that is private money and they need money so folks who want to help, donate to the Fisher House, help them get the research and treatment that these folks need so badly.

COLLINS: Absolutely. You know, the other thing is changing the culture. And...

RIECKHOFF: Absolutely.

COLLINS: ... making sure that these men and women know that it's OK and acceptable to go and get the help that they, obviously, desperately need.

Paul Rieckhoff, we sure do appreciate your time here today on this...

RIECKHOFF: Thank you.

COLLINS: ... disturbing report. Thanks.

RIECKHOFF: Thank you very much, Heidi.

COLLINS: In need of a change. The GOP struggled to find its way back.

(COMMERCIAL BREAK) COLLINS: Removing any trace of Rod Blagojevich. Workers moved quickly to take down his picture from the state capitol after the Illinois Senate voted to remove him from office.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Sean Berg.

UNIDENTIFIED MALE: Yes.

(END VIDEO CLIP)

COLLINS: A yes vote, 59 times. The Illinois Senate unanimous in its decision to remove Blagojevich. He made a last-minute plea to the state senators but his words, obviously, did not have an effect.

(BEGIN VIDEO CLIP)

ROD BLAGOJEVICH, FMR. ILLINOIS GOVERNOR: I'm, obviously, saddened and disappointed, but not at all surprised by what the state Senate did today. It was something that I knew they would do a long time ago.

I love the people of Illinois. Today now more than I ever did before. And...

UNIDENTIFIED FEMALE: We love you, too.

BLAGOJEVICH: Thank you. And the fight goes on. Just because I'm not governor anymore doesn't mean I'm not going to keep fighting for you and for the causes that I fought for my whole life.

(END VIDEO CLIP)

COLLINS: Lieutenant Governor Pat Quinn was sworn in to take over as governor. The Illinois Senate also voted to ban Blagojevich from ever holding any other state office.

President Barack Obama applauded the action saying, quote, "Today ends a painful episode for Illinois. For months, the state had been crippled by a crisis of leadership. Now that cloud has lifted."

New Illinois governor Pat Quinn was serving his second term as Rod Blagojevich's lieutenant where he successfully led the effort to block protests at military funerals and secured funding to support families of Illinois National Guard troops and reservists.

Before taking office, Quinn was a successful consumer advocate. He is scheduled to hold his first news conference as governor at 11:00 a.m. Eastern. Going to be interesting and yes, of course, you can see it right here on CNN.

Don't like the current credit scoring system? Well, a new one's coming and you might find it fairer.

(COMMERCIAL BREAK)

ANNOUNCER: Live in the CNN NEWSROOM, Heidi Collins.

COLLINS: On Wall Street unemployment yesterday we learned unemployment claims hit a record high and new home sales hit a record low. And today, we're seeing how that weakness is affecting overall economic growth.

Susan Lisovicz is at the New York Stock Exchange with a look at the fourth quarter GDP and a preview of the trading day.

Hi there, Susan. Yes. We know it's -- it was pretty bad but as we were talking with Christine Romans, she said, you know, GDP could have been worse.

SUSAN LISOVICZ, CNN CORRESPONDENT: We were braced for a lot worse.

COLLINS: Yes.

LISOVICZ: We -- we were braced for 5.5 percent decline. And so, something like 3.5 isn't -- is bad, not as bad. But those problems, coupled with the big decline in exports and consumer spending, forced the economy to contract at an annual pace of 3.8 percent in the fourth quarter.

That is the worst showing in 26 years and could be revised even lower in the coming months. And that is a funky opening bell. Actually, you have bells this morning, Heidi. I don't know if you can see them, but it is a remote from Davos, Switzerland.

COLLINS: Yes, the economic summit.

LISOVICZ: The site of the 2009 World Economic Forum and the beautiful village of Davos, Switzerland. Beautiful background but on Wall Street it's pretty ugly, what we have been seeing.

And this just in -- I want to mention this real quick, Heidi. Caterpillar earlier this week announced it would cut its payroll by 20,000.

COLLINS: Yes?

LISOVICZ: Well, on top of that, CAT is just announcing it is going to slim down another 2,100 jobs at three Illinois plants to match production with falling demand; that just in from Caterpillar.

We are getting quarterly earnings, as you know. ExxonMobil posting record-breaking profits for the year, $45 billion for 2008. That was, of course, largely due to the fact we saw oil at $150 a barrel. By the end of the year, though, crude tumbled at 30 bucks. The recession hit hard. Exxon's fourth quarter profit fell nearly 35 percent. Procter & Gamble, also feeling the pinch. This is the consumer products giant. They are have everything from Tide detergent to Crest toothpaste, Pampers diapers, and also hit by weak demand. Folks are just buying cheaper things and retailers are lightening up their inventories.

But online retailer Amazon posted a 9 percent jump in profits. Issued an upbeat forecast for the year. Internet retailers have faired better in what is a challenging environment. In the early going, Dow has got life to it after a fall of more than 200 points. Blue chips up 27. The Nasdaq is up 12 - Heidi?

COLLINS: All right. We're watching and keeping our fingers crossed to a nice end to a Friday.

LISOVICZ: I'll be back.

COLLINS: All right. Susan Lisovicz, thank you.

A blistering reprimand for Wall Street from President Barack Obama. He calls it, quote, "shameful" that Wall Street managers are receiving billions of dollars in bonuses, while their companies are bolsters by federal bailout funds. The president spoke candidly in a meeting in Washington with his economic team.

(BEGIN VIDEO CLIP)

BARACK OBAMA, (D) PRESIDENT OF THE UNITED STATES: When I saw an article today indicating that Wall Street bankers had given themselves $20 billion worth of bonuses, the same amount of bonuses as they gave themselves in 2004, at a time when most of these institutions were teetering on collapse and they are asking for taxpayers to help sustain them. And when taxpayers find themselves in the difficult position that if they don't provide help, that the entire system could come down on top of our heads, that is the height of irresponsibility. It is shameful.

(END VIDEO CLIP)

COLLINS: It is day 11 of the Obama administration. Minutes from now the president receives his daily economic briefing. Next hour he makes remarks on the Middle-Class Working Family's Task Force. This afternoon the president meets with senior enlisted officials at the U.S. Armed Forces.

A Republican senator could fill a crucial position in president Obama's Cabinet. Congressional sources say Senator Judd Gregg, of New Hampshire, is being considered for Commerce secretary. Gregg was a chief negotiator of the $700 billion bank rescue package. President Obama initially nominated New Mexico Governor Bill Richardson, as you know, for Commerce secretary, but Richardson bowed out because of a federal investigation into how his political donors won state contracts.

This reminder just over an hour from now, President Obama makes those remarks on middle class working families and their struggles in today's economy. We will take the comments live at 10:45 Eastern.

Republicans challenge President Obama over the stimulus plan, there's an internal battle now over the future of the GOP. The Republican National Committee will be electing a new leader today and CNN Senior Political Correspondent Candy Crowley takes a look at the party's fight to get its political footing.

(BEGIN VIDEOTAPE)

CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT (voice over): Republican Party activists are meeting inside this hotel ballroom in Washington, D.C. There will be no dancing.

SEN. MITCH MCCONNELL, (R) MINORITY LEADER: We need to recognize where we are. Over the past two elections, we've lost 13 Senate seats and 51 House seats. Our most reliable voters are in decline as a percentage of the overall vote. And Democratic voter registration is on the rise.

CROWLEY: It's a mess. As Republicans grapple with how to expand the party's appeal without abandoning the party's principles, how to attract new Republicans, without alienating the faithful.

UNIDENTIFIED MALE: Clearly, the Republican brand needs work and I think that's a widespread recognition here that we lost our way.

CROWLEY: For starters, eight years of massive spending and jaw- dropping deficits have shaken the party's core economic values beyond recognition.

UNIDENTIFIED MALE: We're the party of less government, less taxes.

CROWLEY: More difficult than a course correction on economics is reputation. Republicans say they are wrongly viewed as the antis, anti-immigrant and anti-union and anti-environment; the party of no. Which is why, as Republicans line up to oppose a stimulus plan they think costs too much and won't work, they sound so defensive.

SEN. ROBERT BENNETT, (R) UTAH: It has nothing to do with the idea that we might get some political advantage if Obama stumbles. As an American, I want to see the right thing done, regardless of who gets the political credit.

CROWLEY: There are Republican alternatives, but it's risky business, opposing the stimulus plan without being seen as opposing a very popular president whose courtship of Republicans has been frequent and well photographed.

The party's myriad problems on and off the Hill are exacerbated by the absence of a clear leader. Democrats are happy to fill the void with the notion that sharp-edged talk show host Rush Limbaugh is the true voice of Republicans, and he's not applauding the president's outreach program.

RUSH LIMBAUGH, CONSERVATIVE RADIO TALK SHOW HOST: But when he got Republican input, he rejected it. Remember, he said he won the election, meaning he is going to do whatever he wants to do. This entire sham of a bill, and the sham of this great uniter and unifier has now been exposed.

CROWLEY: Inside the ballroom, they are still not dancing.

MCCONNELL: My concern is that unless we do something to adept our status as a minority party may become too pronounced for an easy recovery. CROWLEY: The clock is ticking. Candy Crowley, CNN, Washington.

(END VIDEOTAPE)

COLLINS: Utility crews are trying, but with all that ice, it could be weeks before everyone is west central Kentucky has power again. And community leaders are begging for any help they can get. More from Scott Harvey from our affiliate WAVE.

(BEGIN VIDEOTAPE)

SCOTT HARVEY, REPORTER, WAVE 3 (voice over): The entire town of Leitchfield is dark.

UNIDENTIFIED MALE: This is like a war zone.

HARVEY: Even the Grayson County Emergency Management Center is running on generators. The director, Randall Smith, says they are making it, but barely.

UNIDENTIFIED MALE: I can't reinforce enough. We need volunteers to come to Grayson County.

UNIDENTIFIED FEMALE: They are on their last leg of gas.

HARVENY: 95 percent of Grayson County has lost power, and there is only one operating gas station. Even it is running on an emergency generator.

UNIDENTIFIED MALE: This is the worst I've ever seen.

HARVEY: And it's either wait in line -

UNIDENTIFIED FEMALE: Two hours.

HARVEY: Or make a long drive to get gas and kerosene.

UNIDENTIFIED MALE: Bowling Green, Kentucky. In other words, Nashville, which is about 62 to 72 miles.

HARVEY: For now the entire county is in dire need of volunteers, like nurses and other medical staff.

UNIDENTIFIED MALE: We will probably have some fatalities in all of this. Because we have some people on the lakes that we can't even cut into to go get.

UNIDENTIFIED FEMALE: It looks like somebody just pulled into the driveway.

UNIDENTIFIED MALE: There is so many things that we can't do.

UNIDENTIFIED FEMALE: See if I can find that out.

UNIDENTIFIED MALE: We need chainsaws ...

UNIDENTIFIED FEMALE: Kerosene ...

UNIDENTIFIED MALE: Manpower ...

UNIDENTIFIED FEMALE: Food.

UNIDENTIFIED MALE: We just need help. That's all.

(END VIDEOTAPE)

COLLINS: The American Red Cross has opened two shelters now in Leitchfield, both are being powered by generators. Those shelters, and others across the region, are open 24 hours a day now to anyone who needs to warm up, get a bite to eat, and maybe a little bit of sleep.

Want to take a moment to get to the mayor of Clarkson, Kentucky. Mayor Bonnie Henderson is joining us now.

And, Mayor, before we get to you, I just want to update some of the information we have now coming in to us from our correspondent. Susan Candiotti heard on the radio, WHSS there, from the governor, the Kentucky Governor Steve Beshear, that there are apparently now eight unconfirmed deaths as a result of this storm for the state of Kentucky. Also learning that FEMA has just now delivered a large number of generators, which sounds terrific, especially when we just mentioned those shelters.

Mayor Henderson, can you tell us the situation from where are you in Clarkson?

MAYOR BONNIE HENDERSON, CLARKCSON, KENTUCKY: Well, right now, I'm at the DES office. That is located in Leitchfield, it is for the county. And I'm standing out in the hall talking to you and it's so cold I'm shivering so bad it's hard to talk.

COLLINS: Really?

HENDERSON: I've had a problem getting them to come down here because I couldn't get a hold of some of my people. We have had very little phone service. I've had to stay at city hall the first two days manning the phones myself. They were ringing like continuously. People freezing, needing kerosene, and needing a shelter; needing where to go, what to do. And we finally - we were first saying, OK, we're to the point of survival, say put, try to stay warm. You have water.

COLLINS: Well, how are you - forgive me, Mayor, for interrupting. How are you getting that information out to the people of your city?

HENDERSON: Well, I have one police officer in the City of Clarkson.

COLLINS: Wow.

HENDERSON: That I'm mayor over. He is patrolling -- we had a big backhoe, one of the city workers owned a huge backhoe and he took it around and cleared the streets enough that the police officer can make his rounds. And he is just going through town and checking on people and checking on people, and letting them know how to get to shelter, and where the shelter is located. We have the one at the high school. And just last night -- we had the school open at Clarkson, but we had heat only and water.

So last night, the Salvation Army, thank God for them, they came in with a canteen mobile unit, and they can feed up to 600 people a day. So they provided food last night and they let us know this morning that they had hot breakfast.

COLLINS: Good.

HENDERSON: And anybody can go there and they can pick up food and leave, or they can go in the cafeteria at the school and eat. And it's just the worst thing that I have ever witnessed.

COLLINS: How many people live in Clarkson?

HENDERSON: Well, we are population of around 700.

COLLINS: Okay. Okay. Well, I can, obviously, hear the great concern in your voice and, as you mentioned, some chattering teeth as well. We are very glad you are able to sort of get this word around the best you can. Boy, one police officer, that's a lot of work to be doing.

HENDERSON: I have a wonderful fire department. There was 19 volunteers there last night and they have slept in the meeting room, and they have a generator going in there and they are keeping warm.

COLLINS: All right.

HENDERSON: And they are out freezing.

COLLINS: I know. Well, we'll keep in --

HENDERSON: You know, trying to help people.

COLLINS: Very much so. We will keep in touch with you, too, Mayor, if that's all right and keep our eye on the situation from where you are. And, of course, for the rest of the state of Kentucky and some of these hard-hit states as well.

Sure do appreciate your time, Mayor Bonnie Henderson. And obviously, the best of luck to you and the people in Clarkson, Kentucky.

Rob Marciano is standing by now to talk more about this.

I'm not sure if you were able to hear that, Rob. What are we talking about temperatures today?

ROB MARCIANO, CNN METEOROLOGIST: Below freezing.

COLLINS: Really?

MACIANO: Not going to get a whole lot of help from Mother Nature. Here's a map. It actually shows an area that is south of that part of Kentucky, which is up here. And everybody still in the upper 20s; I don't think anywhere in Kentucky will get above freezing today. They will obviously be below freezing tonight. Tomorrow they may get above freezing and I think a warm-up on Sunday. So another good 24 to 36 hours of subfreezing temperatures and certainly some shivering folks there to say the least. It's a dangerous situation.

(WEATHER FORECAST)

COLLINS: Hoping for a big score. Advertisers pony up big bucks for "Super Bowl" exposure.

(COMMERCIAL BREAK)

COLLINS: A new credit scoring system coming out and for many of you, this program will be more forgiving. CNN's Gerri Willis joins us with a live look at all of this.

So, Gerri, tell us how this works, first off.

GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Good morning.

You know Fair Isaac, they are the company that developed the formula that determines your FICO score. And your FICO score seems to rule your life. They have a new version of FICO, called FICO 08. This new FICO score, well it is supposed to be an improvement and we really recommend and welcome improvements in this area because credit scoring is typically so problematic because they are based on reports that can have errors in them.

COLLINS: Yes, FICO used to be a little psycho, right?

WILLIS: That's right. FICO was psycho, I love that! That's awesome.

Here is what the new one will do for you, OK? The new FICO 08 scoring model will really target folks in the subprime category that scores in the 600s, OK? Now these are the people that lenders are really struggling to understand, to predict how well they might pay their bills. They are the folks whose credit score might change the most as bankers move to this new FICO 08.

Now, if your score is in the 700 to 800 range you're less likely to be impacted by this. The new program takes care of a couple of problems we have been sort of complaining about for some time. For example, a library card fine won't send your score plum meting because the new scoring ignores collections under a hundred bucks.

COLLINS: OK.

WILLIS: It will also ignore isolated delinquencies. So, if you forget to pay your utility bill while you were on vacation, but were good for all other debts, don't worry. Your credit score won't be impacted.

COLLINS: Good. Well, I mean that has got to be some type of improvement. What are some of the other ways, though, people can get kind of a grip on their credit profile?

WILLIS: First off these changes aren't going to happen soon. It could be months or even years before the changes become effective and a reality for folks. In the meantime, Fair Isaac has a program where consumers are able to get their credit scores for free through their bank or their credit union. And don't forget there are a number of free web sites you can get an estimate of your credit score for free, including Credit.com and Creditkarma.com.

Of course, don't pass up getting your free credit report, which is what all of this is based on, from the three annual credit reports at annualcreditreport.com.

COLLINS: You not going to sing the song, are you?

WILLIS: It's a different company. Annualcreditreport.com is where you want to go. Because it's free and you don't have to give them any money.

COLLINS: Understood. Good point. All right, our Personal Finance Editor Gerri Willis.

Gerri, nice to see you.

WILLIS: Great to see you.

COLLINS: If you have lost your job, though, or you get laid off, how could the stimulus package actually help you?

(COMMERCIAL BREAK)

COLLINS: President Obama getting ready to announce a task force that will examine the financial well-being of the middle class. We're going to carry the president's comments for you live, that will be coming up in the next hour right here in the CNN NEWSROOM.

We are seeing big numbers on the stimulus package, and a report on it, the size of a small phone book. But in practical terms, what could it really do for you? CNN's Jessica Yellin takes a look.

(BEGIN VIDEOTAPE)

JESSICA YELLIN, CNN CORRESPONDENT (voice over): At Kodak, Starbucks, Home Depot, and Target, thousands of people getting pink slips. House Democrats say help is on the way.

REP. ALAN GRAYSON, (D) FLORIDA: What this bill does is, it meets human needs. It does what a just society does. It feeds the hungry, it shelters the homeless, and it heals the sick.

YELLIN: That's a tall order. So how would this bill help? For anyone who has lost their job, the bill almost doubles the amount of time you can collect an unemployment check. And it adds $25 to that check every week. Of that's cash in your pocket.

UNIDENTIFIED MALE: We'll check your blood pressure.

YELLIN: If you lose your job, you lose your health care. Now, some people are allowed to buy into their old company health insurance, but it's incredibly expensive. With this bill, the government would pick up 65 percent of your health insurance premium, making it affordable to more people.

There's another more controversial option in the bill. Through next year, it would let states accept anyone who collects unemployment insurance into Medicaid. Much that's the government health care program usually open only to the very poor. Now, some conservatives are howling about the idea of letting more people into Medicaid, and the Senate is against it.

SEN. MITCH MCCONNELL, (R) MINORITY LEADER: If we don't reign this spending in it, the senate will have only a fraction left for things like defense, roads, bridges and education.

YELLIN: And the crucial piece of a rescue, getting you a job. One approach, this bill gives grants to build more broadband Internet. If your area gets a grant, you could get a job laying fiber, or taking orders for new broadband at a call center. And with more Internet, more people in your area might shop online, or open home businesses, helping the economy even more.

(On camera): The bill does have its limitations. On this Internet portion alone, it does not fund job training. It takes time for that money to get out the door, and there's no guarantee that companies would hire new workers instead of keeping workers they already have. But supporters say this Internet portion, on its own, would create at least 100,000 new jobs. Jessica Yellin, CNN , New York.

(END VIDEOTAPE)

COLLINS: You know about the woman who had eight babies last week - excuse me, this week, it was. And now find out about the six kids she already has at home.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: I wish the best to the Cardinals, they have been long- suffering, it's a great Cinderella story, but other than the Bears, the Steelers are probably the team that's closest to my heart.

(END VIDEO CLIP)

COLLINS: President Obama making his pick for Super Bowl XLIII, Mr. Obama counts Pittsburgh Steelers owner Dan Rooney among his campaign supporters. Pennsylvania went for Obama in November. Arizona, of course, went for John McCain.

Do you watch the game, or the commercials? We talk about it every year. Advertisers are plunking down big money for just 30 seconds in the spotlight. Is it worth the gamble, though? CNN's Larry Smith takes a look.

(BEGIN VIDEOTAPE)

(COMMERCIAL CLIPS MONTAGE) LARRY SMITH, CNN SPORTS CORRESPONDENT (voice over): The annual battle for commercial supremacy during Sunday's "Super Bowl" will come with a record price tag of $3 million for 30 seconds of ad time. In today's desperate economy, the real question may be, is it really worth it?

TY MONTAGUE, CHIEF CREATIVE OFFICER, JWT: It buys you access to an audience of 100 million people, or almost 100 million people. You know, the "Super Bowl" is still -- is one of the great shared experiences in our culture today.

JOEL EWANIOCK, V.P., MARKETING, HYUNDAI: It actually gives us an opportunity to talk to almost all of America at a time where they're actually paying attention to commercials, so it's not that they're just watching the game, they're also watching the commercials.

SMITH: Hyundai is in for the second year in a row, but as stock prices tumble and unemployment rises daily, some companies have decided they simply cannot justify the expense this year. General Motors bailed out under pressure from congressional hearings. While FedEx also decided to say on the sidelines, saying in a statement: "There is a time to justify such an ad spend and a time to step back. Being in the game simply sends the wrong message to both employees and other FedEx constituents."

NBC, which will broadcast the game, sold 85 percent of the ad space by mid September. But has been struggling since the economy tanked shortly thereafter, and is still a few spots from being sold out.

DICK EBERSOL, CHAIRMAN, NBC SPORTS: You tend to get a little bit slower in making decisions. But now, in this last month, getting back to the fact that if you're in the "Super Bowl" it's an unrivalled way to get attention, and so people have come through.

SMITH: Many of those signed on feel it's worth it to be in the line up if only to show competitors and consumers alike that they can still afford to be.

EWANICK: We have seen the companies that have actually pushed harder during recessions; they've actually come out better.

MONTAGUE: Certainly clients can use that environment and the price tag to make a statement about their stability, if you have the money to pay to be the in "Super Bowl", it does say something about your bullishness and your financial stability.

SMITH: And although the price tag is for 30 seconds, in this Internet age, a "Super Bowl" advertiser gets a lot more than half a minute of attention.

UNIDENTIFIED MALE: People search the ads the next day, they comment on other people's opinions about the ads. They look at the polls to see who did better and who did worse, and they debate all that. And all of that is value.

SMITH: So while only one team can be crowned "Super Bowl" champion on Sunday, the advertisers are confident they'll all be winners, too. Larry Smith, CNN, Tampa.

(END VIDEOTAPE)

UNIDENTIFIED MALE: It's going to be a long time before things are back to normal around here.

COLLINS: No, quick fix. More than a million people powerless; some could be in the cold for weeks.

Plus, labor gains. What the old president put in, the new one takes out.