Return to Transcripts main page

CNN Newsroom

Limiting Executive Pay; Commerce Chief's Critics; Doctor's Car Explodes; Pay Cap Reaction From Wall Street; President's Stand on Standards

Aired February 04, 2009 - 11:00   ET

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

DON LEMON, CNN ANCHOR: It is Wednesday, February 4th. Here are the top stories right here today in the CNN NEWSROOM. President Barack Obama live from the White House. That will happen in just a moment. He wants to cap CEO paychecks at companies that take taxpayer bailout money. How did the no-drama Obama team miss three nominees' tax troubles? That's a question -- a roundtable discussion on the vetting process live this hour.

Good morning, everyone, I'm Don Lemon in today for Tony Harris. You are in the CNN NEWSROOM.

All right. Everyone has heard of minimum wage. Well, President Obama wants to set a maximum wage. He wants to do that for executives at companies taking government bailout money. He'll make the announcement any minute now, probably just about a minute and a half, and we'll have that for you live.

But first, we want to go to CNN's White House correspondent, Suzanne Malveaux, with a preview on that.

Suzanne, he's expected to make these announcements. He's also having a little bit of trouble when it comes to nominees.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Don, yes, he's going to making that announcement within a couple minutes or so with his treasury secretary, Tim Geithner, obviously talking about CEO compensation and putting a cap on it, $500,000. And that's really for the biggest companies that are receiving the most money when it comes to federal dollars, our taxpayer dollars, holding to account and essentially what kind of expenses that they're also going to be using for this money.

I want to tell you, as well, he's going to be using some new language, a sense of urgency. He's going to ask lawmakers to pass that economic stimulus package very, very quickly, saying that the situation is dire and catastrophic if it does not happen. He is going to say, Don, "Let's not make the perfect the enemy of the essential."

What he is saying is you're not going to get a perfect piece of legislation here, not everybody is going to be happy, but that it is essential. That he is saying that that economic stimulus package be passed and be passed quickly.

Now, some of the things that he's going to highlight, obviously, Don, is the cap for CEO salaries, $500,000 for those big institutions that are receiving really exceptional government assistance. We're talking about in the billions. Those companies like, say, AIG or Citigroup, those are the companies he is talking about.

He's also going to ask to require banks to basically give reports about their spending. Is it going to be -- what kind of flight services are there, what kind of entertainment and parties and conferences? He wants that information to be public if those companies are getting federal dollars.

He is also going to require CEOs to hold on to their stock for a couple of years before cashing out. He is going to give shareholders more say when it comes to this executive compensation debate.

And finally, the treasury secretary is going to call for a conference, an industry-wide conference, to talk about the long-term reform when it comes to executive compensation. What is the role of the federal government to begin with? Is it appropriate to be making these kinds of determinations about who gets what, their salary, and how this money is all spent? That is an active debate, Don, as you know, and that is something that they say the Treasury Department is going to get involved in -- Don.

LEMON: Yes, it's interesting to see if there has been any precedent set when it comes to any other presidents doing this. But Suzanne, just last week, the president called the bonuses for folks on Wall Street, especially the CEOs, he said it was downright shameful.

MALVEAUX: Absolutely right. I mean, he was emotional about it.

We saw kind of a little bit of anger and frustration there, because what he is trying to do is convince the American people that his administration is going to do it better than the Bush administration. You remember when the $700 billion essentially was released, and the first bit of it was spent, and nobody could figure out where those dollars went? Well, he says for the second installment, $350 billion, he's going to make sure that the American people, taxpayers, know where their money is going. And part of that, obviously, is going to be capping the salary of some of the CEOs of the biggest companies -- Don.

LEMON: And Suzanne, stand by as we wait for the president to come out. It's very interesting, because he is usually a little bit early, if not on time, or a little bit early. We'll check back with you in just a little bit.

We'll watch those pictures coming out of the White House today, but we want to get you now to West Memphis, and this is West Memphis, Arkansas. And here's the deal. We are being told that a prominent doctor there, his car exploded.

We've got some new video in of investigators on the scene. This is courtesy of our affiliate WREG.

Now, here's what we're being told happened by one of our affiliates. This morning, the street there, Avalon and Cooper, they said a prominent doctor got into his car, the car exploded. He was then airlifted to a medical center for treatment, and we are being told is he is in extreme critical condition.

What we know about the doctor, that he is a general practitioner. They have not released his name yet; however, the address of the explosion we're told happened matches the address of a doctor who is there. We're not giving that information out until we confirm exactly who it is.

The FBI, as well as the ATF, Alcohol, Tobacco and Firearms, on the scene now, trying to figure out exactly what happened. You can see the crews there, the local news media in the area.

These are live pictures. Checking out that CNN -- this is believed to be the car here. It looks, from my vantage point, like a white SUV. But again, this doctor's car exploded this morning when he got into it. Obviously, people on scene know who it is, but they're not giving that information up yet until they check out everything, check out every angle.

This story happened just a couple minutes ago, and as we wait for the White House, we want to follow this developing story, because this is unusual. Don't know the background here, if this doctor had any problems, if someone, you know, may have been targeting him. We do not know. But we do know that his car exploded this morning.

We're being told extreme critical condition, had to be airlifted to a medical center. More information on that. We'll bring it to you as soon as we get it.

Also, we'll get back to the White House just as soon as the president shows up.

We're going to move on now.

Of course, issue number one is the economy, and Wells Fargo has called off a lavish Las Vegas trip it had planned for its top performers. The move comes after the bank, which received $25 billion in bailout money, got an earful from lawmakers and from critics. Wells Fargo says it views the taxpayer dollars to help customers and not pay for that event.

Electronic giant Panasonic is slashing as many as 15,000 jobs. Half of them are in Japan. It is also closing 27 factories around the world. Panasonic says it expects to post a net loss of more than, get this, $4 billion for its fiscal year, which ends in March.

Remember those scooters? Well, they were all the rage just last summer, not very long ago. That's when gas prices were at their record highs. But now those prices are down, and they're down by half. Sales have tanked.

The owner of this Florida shop says he used to sell five a day. Now he sells less than 10 per month. Not good news, not good business. Well, even some scooter owners admit they're now considering four wheels.

(BEGIN VIDEO CLIP) UNIDENTIFIED MALE: I'm used to having something where I go 70 miles to the gallon, so I want something like a small car.

(END VIDEO CLIP)

LEMON: Sales of Smart Cars, which get great gas mileage, are also down dramatically.

Let's talk more about the president. President Obama's choice to head the Commerce Department is drawing fire from some trade and business groups. They point to Judd Gregg's record on outsourcing and free trade.

We get the very latest now -- we are waiting for the president. If he comes out, we may have to interrupt this story, but we'll get the very latest now on Judd Gregg from CNN's Bill Tucker.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): Senator Judd Gregg is a controversial pick to lead the Commerce Department. Groups who believed President Obama would usher in a new trading policy are bitterly disappointed. Global Trade Watch responded saying, "Senator Gregg as commerce secretary certainly is not the change we can believe in."

The U.S. Business and Industry Council, representing 1,850 small and medium-sized businesses, calls the appointment baffling.

ALAN TONELSON, U.S. BUSINESS & INDUSTRY COUNCIL: He is a free trade purist. Judd Gregg has never, ever met an outsourcing focus trade agreement that he hasn't loved. He's voted for all of them enthusiastically.

TUCKER: Our trade deficit through the end of November of last year $630 billion. Other groups are disturbed at Gregg's staunch support of more guest workers.

In 2000, he voted to raise the cap on H-1B visas. Then in 2007 he authored legislation that would have more than doubled the size of the H-1B visa program to 150,000. Gregg is also a strong proponent of outsourcing and in the opinion of many worker activists it would be a serious mistake to ignore his stance on those issues.

RON HIRA, ROCHESTER INST. OF TECHNOLOGY: Commerce plays a very important role in all of these kinds of issues and is a big voice representing big business within the administration.

TUCKER: Gregg's trade and outsourcing views appear contrary to statements by President Obama, but Gregg's appointment is consistent with others made by the president. Ron Kirk, the trade representative and the president's chief of staff, Rahm Emanuel, are strong NAFTA supporters as is Larry Summers who leads the president's National Economic Council and Economic Council member Diana Farrell is an outspoken proponent of outsourcing.

Bill Tucker, CNN, New York.

(END VIDEOTAPE)

(WEATHER REPORT)

LEMON: We're going to get to the White House now, where the president is with Timothy Geithner, going to make an announcement when it comes to CEOs, and see what else they talk about.

Let's listen in.

(JOINED IN PROGRESS)

TIMOTHY GEITHNER, TREASURY SECRETARY: ... built on trust and confidence. They depend on trust and confidence.

This economic crisis was caused in part by a loss of confidence in our financial institutions, and it was made worse by a loss of faith in the quality of judgments made by some executives and some boards of directors. Those failures have caused great damage. You can see this across our economy and around the world, as workers lose their jobs, homeowners fight to stay in their homes, families wary about their retirement savings, and businesses struggle to find the credit necessary to survive.

Economic recovery will require restoring confidence in the leadership of these institutions and in the ability of our financial system to provide the resources necessary to get the economy back on track. The previous administration, working with the Congress, invested substantial resources in our banks to hold the financial system together. Those actions were absolutely necessary to prevent much greater damage than what we have seen today. And we will have to do more, substantially more, to fix this crisis.

Next week, we are going to outline a comprehensive program for financial recovery. This program will be directed at supporting the flows of credit that are essential for our economy to begin growing again. And this program will bring substantial reforms to improved transparency, provide greater accountability, and measure results.

There is a deep sense across the country that those who were not -- who were not responsible for this crisis are bearing a greater burden than those who were. So today, I'm pleased to join the president in announcing a set of reforms to the way companies receiving taxpayer dollars reward their top executives.

Nothing is more important to me than earning the confidence of the American people that every policy we embark on is motivated not by privilege or private gain, but by the public interest in strengthening our economy and creating shared prosperity. The executive compensation policies we are announcing today are designed to strengthen the public trust, that our financial recovery programs will get credit flowing again and get job creation moving once more.

This will not be easy, it will take time, but the American people can be confident that this president and his economic team will bring every ounce of energy and commitment possible to moving our nation to an economic recovery that is as swift and widespread as possible.

Thank you. .

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Thank you, Tim, for your hard work on this issue and on the economic recovery.

The economic crisis we face is unlike any we have seen in our lifetime. It's a crisis of falling confidence and rising debt, of widely distributed risk and narrowly-concentrated reward. A crisis written in the fine sprint of subprime mortgages, on the ledger lines of once-mighty financial institutions, and on the pink slips that have upended the lives of so many people across this country, and cost the economy 2.6 million jobs last year alone.

We know that even if we do everything that we should, this crisis was years in the making, and it will take more than weeks or months to turn things around. But make no mistake. A failure to act and act now will turn crisis into a catastrophe and guarantee a longer recession, a less robust recovery, and a more uncertain future.

Millions more jobs will be lost. More businesses will be shuttered. More dreams will be referred. And that's why I feel such a sense of urgency about the economic recovery and reinvestment plan that is before Congress today.

With it, we can save or create more than three million jobs, doing things that will strengthen our country for years to come. It's not merely a prescription for short-term spending, it's a strategy for long-term economic growth in areas like renewable energy and health care and education.

Now, in the past few days, I've heard criticisms that this plan is somehow wanting. And these criticisms echo the very same failed economic theories that led us into this crisis in the first place, the notion that tax cuts alone will solve all our problems, that we can ignore fundamental challenges like energy independence and the high cost of health care, that we can somehow deal with this in a piecemeal fashion and still expect our economy and our country to thrive.

I reject those theories, and so did the American people when they went to the polls in November and voted resoundingly for change. So I urge members of Congress to act without delay.

No plan is perfect, and we should work to make it stronger. No one is more committed to making it stronger than me. But let's not make the perfect the enemy of the essential. Let's show people all over the country who are looking for leadership in this difficult time that we are equal to the task.

At the same time, we know that this recovery and reinvestment plan is only the first part of what we need to do to restore prosperity and secure our future. We also need a strong and viable financial system to keep credit flowing to businesses and families alike. And my administration will do whatever it takes to restore our financial system. Our recovery depends on it. And so in the next week, Secretary Geithner will release a new strategy to get credit moving again, a strategy that will reflect some of the lessons of past mistakes while laying the foundation of the future. But in order to restore trust in our financial system, we're going to have to do more than just put forward our plans.

In order to restore trust, we've got to make certain the taxpayer funds are not subsidizing excessive compensation packages on Wall Street. We all need to take responsibility, and this includes executives at major financial firms who turned to the American people, hat in hand, when they were in trouble, even as they paid themselves customary lavish bonuses.

As I said last week, this is the height of irresponsibility. It's shameful. And that's exactly the kind of disregard of the costs and consequences of their actions that brought about this crisis, the culture of narrow self-interest and short-term gain at the expense of everything else.

This is America. We don't disparage wealth. We don't begrudge anybody for achieving success. And we certainly believe that success should be rewarded. But what gets people upset, and rightfully so, are executives being rewarded for failure, especially when those rewards are subsidized by U.S. taxpayers, many whom are having a tough time themselves.

For top executives to award themselves these kinds of compensation packages in the midst of this economic crisis isn't just bad taste, it's bad strategy. And I will not tolerate it as president. We're going to be demanding some restraint in exchange for federal aid, so that when firms seek new federal dollars, we won't find them up to the same old tricks.

As part of the reforms we're announcing today, top executives at firms receiving extraordinary help from U.S. taxpayers will have their compensation capped at $500,000, a fraction of the salaries that have been reported recently. And if these executives receive any additional compensation, it will come in the form of stock that can't be paid up until taxpayers are paid back for their assistance.

Companies receiving federal aid are going to have to disclose publicly all of the perks and luxuries bestowed upon senior executives and provide an explanation to the taxpayers and to shareholders as to why these expenses are justified. And we're putting a stop to these kinds of massive severance packages we've all read about and discussed. We're taking the air out of the golden parachutes.

We're asking these firms to take responsibility, to recognize the nature of this crisis, and their role in it. We believe that what we have laid out should be viewed as fair and embraced as basic common sense.

And finally, these guidelines we're putting in place are only the beginning of a long-term effort. We're going to examine the ways in which the means and manner of executive compensation contributed to a reckless culture and a quarter-by-quarter mentality that in turn helped to wreak havoc in our financial system. We're going to be taking a look at broader reforms, so that executives are compensated for sound risk management and rewarded for growth measured over years, not just days or weeks.

We all have to pull together and take our share of responsibility. That's true here in Washington, that's true on Wall Street.

The American people are carrying a huge burden as a result of this economic crisis, bearing the brunt of its effects, as well as the cost of extraordinary measures we're taking to address it. The American people expect and demand that we pursue policies that reflect the reality of this crisis, and that will prevent these kinds of crises from occurring again in the future.

Thank you, very much.

LEMON: All right. The president and his treasury secretary, Timothy Geithner, announcing these reforms.

Mr. Geithner said they're going to start as soon as next week, he says, with really sweeping reforms. Next week to outline a plan of reform. Companies who receive taxpayer dollars, he said, have to abide by certain rules and standards. It's going to be swift, it's going to be widespread, as widespread as possible.

You know, that's $500,000 a year. That's what the president mentioned. They're going to cap that. It sounds like a lot to most people, but what about a CEO of a big company?

For more on the president's remarks now and the plan to cap executive pay, let's go to CNN's business correspondent Ali Velshi. He joins us now -- he's doing his radio show in New York.

Five hundred thousand dollars, it's a lot to most people by any standards, but to people who are making millions, Ali, it's not a lot of money, especially when you have obligations.

ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Yes, and that's tough, if people were really -- these executives were expecting to make lots of money. But ultimately, the rest of us have had to deal with the fact that the economy has tightened up, and in many cases, people are losing their jobs, they're not getting paid as much as they wanted, Don.

So the deal here with the government is, if you are a recipient of exceptional -- this is what they're calling exceptional government funds, not everybody, your top executives have to have their compensation limited to $500,000, plus restricted stocks. So they could have much more, but the restricted stock can't be vested, can't be used, they can't do anything with that stock until after the government or the taxpayers have been paid back in full with interest.

So that's an interesting long-term incentive. You could end up making more than $500,000 a year if your stock ends up being worthwhile and your company is able to pay the government back. I think that's a neat idea -- Don.

LEMON: And, you know, people say, "woe is me," and I say that only because if you are used to living a certain lifestyle, which these guys are, and they're making millions of dollars. You know, some of them, $500,000 may be their monthly spending and they may not be able to make their monthly obligations. But woe is me, as the American public would say, right? As anyone would say.

But listen, Ali, something that I found interesting, he said companies receiving federal aid are going to have to disclose publicly all of the perks and luxuries bestowed, but then he says, "This is going to be a long-term effort," and they're going to look at other ways that they can also restrict some of the pay and also tighten the belts.

VELSHI: Yes. And frankly, shareholders of public companies should have been demanding that anyway. I mean, after these companies have had -- the financial companies have had the losses that they have had over the last year, Don, I'm surprised, I often say, that they were able to buy pencils without approval, let alone go on junkets and things like that. And they'll tell you, they've got to do this to keep their people happy.

Honestly, Don, I think you should keep your people happy, I think employees should be kept happy. But in this environment, where is it that financial employees are going to go to get the kind of money that they were earning? It's hurting all of us, and we're going to have to share the pain. And Wall Street has done a particularly bad job of showing that they are able to understand that pain being shared.

Now, Don, they have shared the pain. Something more than a quarter million people have been -- have had their jobs eliminated on Wall Street in the last year. More than that, if you add 2007. So they are going through pain, but the banks that receive money have got to understand, they've been bailed out by the taxpayer, we have to play by a new set of rules now.

LEMON: When you take a look at the amount that we're in trouble, you know, almost a trillion dollars in this recovery package, and you look at executive pay and you look at the bonuses that the president spoke out about last week, really, that's just a drop in the bucket. This isn't -- this is really a small amount of what we need in order to make a recovery here. But it is, you know, sort of a sign of the times, and they have to start somewhere.

VELSHI: Well, it's also like the auto companies when the CEOs came in on their jets. You know, we can spend too much time on it when, ultimately, it's not the underlying problem. But it does speak to the culture of the people who are running these businesses.

LEMON: Yes.

VELSHI: They have got to understand how serious this is, and if they can understand it by virtue of their own pay being limited, then they've got a stake in the game. They understand that times are tough and we have to change things. But I agree with you, Don, it is not where our problem lies. Executive compensation is but a drop in the bucket of how serious this economic issue is. So I'd just as soon this be dealt with now, put aside, and let's get back to the work of a stimulus plan that's actually going to get America back to work.

LEMON: Very well put.

Our senior business correspondent, Mr. Ali Velshi, on the radio today and on television. He's multitasking.

Thank you, sir.

We're going to get back to our breaking news. We want to take you now to Arkansas.

Take a look at these pictures, aerial shots. These are live shots from our affiliate WMC.

We're being told that a prominent doctor there was involved in either a car explosion or a car fire. The FBI is not confirming either. They're trying to figure out exactly what's going on. ATF also on the scene.

This guy was a very prominent doctor and also led a medical board in Arkansas. And we're trying to figure out exactly what's going on.

More information coming up in the CNN NEWSROOM, including one of our very own correspondents who knows this doctor. We'll talk to him, just moments away.

(COMMERCIAL BREAK)

LEMON: Breaking news today out of West Memphis, Arkansas. You're looking at pictures from our affiliate WMC. These are live pictures.

Look at that. The front of a Lexus SUV, the hood is up, and it looks like the bumper and the front light, there was definitely something blown off of that car. Something blew that off the car. This is a prominent doctor who is the head of the medical board in West Memphis, Arkansas.

I want to get now to our anchor correspondent, T. J. Holmes, on the phone.

T.J., you are an Arkansas native. You know this doctor. Talk to me about what you know.

T.J. HOLMES, CNN CORRESPONDENT: Yes. This is, quite frankly, quite literally -- I was born and raised in this town, his home, where these pictures, live pictures you're watching, is right up the street from where I went to junior high school, quite literally. So I had to pass his house.

It's a house that a lot of people are familiar with on a very busy street there in West Memphis, Avalon Street. And his house had this concrete wall around it. It was just a huge, beautiful home. You always have to pass by, always have to see.

Now, he was not my doctor. And understand, according to one of his patients I did talk to just a short time ago on the phone, this is a small community. Everybody knows everybody.

West Memphis -- you know, 30,000 people in this town. The doctor, however, was not born and raised in this town. He had only been in West Memphis about 15, 20 years, a general practioner.

He has an adult son, an adult daughter. But as far as around the community, he is -- I'm told he is in church every Sunday, always in church, and is a member of the choir. We understand he's in his early 50s.

Something else about this white Lexus we've been seeing, the word is, at least from his patient that I spoke with, is that, in fact, they understand he just bought this Lexus not too long ago. It's a Lexus hybrid that he bought and hadn't had it a whole lot -- hadn't had it long at all.

But around town, the doctor is very active in the community, he is a part -- every summer, the high school kids, junior high kids after to get their physicals, he donates his time to get them their physicals. He's also the workman's compensation doctor for the school district and on the board of trustees at Fidelity (ph), and as you mentioned, I believe, he is the head of the Arkansas Medical Board, an appointment he got from Governor Huckabee, actually, back in 1997.

Right now also, Don, something else here, where this happened, he is literally -- the home is about six blocks away from the hospital there in west Memphis, Crinton Memorial Hospital is the name of it. You could run it in a few minutes, if you wanted to, but it sounds like you have been reporting that he was taken across the bridge to Memphis, Tennessee. I don't know what that might say about the condition he's in, and that they wouldn't take him just up the street to where a hospital is. That...

LEMON: He may have gone, T.J., to a hospital that may have been better equipped to deal with his injuries.

HOLMES: World-class facilities, over in Memphis for sure, which is right across the bridge there.

LEMON: You also bring up a good point when you talk about him just getting his car, because we were talking to the FBI, T.J., they were saying that they weren't sure if it was an explosion or if there was a problem with this car. And you say he just got it, so, you know, they don't know if it's a problem with the starting system or there was a fire or an explosion. And I know we're saying his car exploded, but according to our latest information we got, T.J., from the FBI is that they weren't quite sure about that.

HOLMES: And, again, we certainly don't want to speculate. Just looking at the picture, you know something certainly went terribly awry with that vehicle and certainly something that's not normal. And you have to bring in federal officials on a case like this and something that I guess you could call this suspicious if you want to, but...

LEMON: Let me stop you right there, because I'm just getting information and I know that, you know, you're on the phone and you're not able to read this, but we're hearing, T.J., that it is not -- they don't suspect foul play. That believe that it was a problem, at least early on. It was a problem with the car, a malfunction in the car. And that's according to police.

So, you know, all of this may be for naught. But we can't be, you know, too careful here when something like this happens. Because when you hear about a prominent doctor in the community, and as you said, he's a very big deal there, we want to cover it.

HOLMES: Well known and beloved and not a bad word anybody could say about him in west Memphis. But certainly a guy everybody knew in town and everybody concerned. It's the talk of the town right now. So certainly good to hear it's not foul play, if that's the case, but don't -- but certainly still, everybody here has their fingers crossed for this doctor.

LEMON: OK, T.J., we appreciate it. Thank you very much.

All right, we'll continue to follow that developing story out of west Memphis, Arkansas as we get more details on it. But as it looks now, police do not believe it was foul play.

Let's move on now and talk about the Obama administration. Under stormy skies, as Cabinet appointments come under scrutiny, it's definitely making our CNN iReporters sound off about it.

(BEGIN VIDEO CLIP)

JIMMY DEOL, CNN IREPORTER: It makes you wonder what that 60- page-long overkill vetting application was about. I mean, you know, are these people declaring the right information or is the vetting team choosing to ignore it? I mean, this is unbelievable. There was Geithner and then the chief (INAUDIBLE) officer, and now Tom Daschle. This is only 25 percent of Obama's Cabinet, the nominated cabinet.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: Top executives at firms receiving extraordinary help from U.S. taxpayers will have their compensation capped at $500,000. A fraction of the salaries that have been reported recently. And if these executives receive any additional compensation, it will come in the form of stock that can't be paid up until taxpayers are paid back for their assistance.

(END OF VIDEO CLIP) LEMON: That was the president, just a short time ago, announcing limits on executive pay packages for companies that take bailout money. What kind of eye-popping paychecks are we talking about? Well, a few examples from 2007. Take a look at this. The top executive at Bank of America, Ken Lewis, well, he topped out at $24.8 million. Wow. Citigroup's CEO earned $3.1 million in 2007; he was promoted to CEO in December of that year. And General Motors's chief executive, Rick Wagoner, raked in $14 million plus.

Most Americans might consider a $500,000 paycheck quite healthy, but one consultant tells "The New York Times" the cap salary, is, "not a lot of money." So how is President Obama's announcement being received on Wall Street? Let's head there, Susan Lisovicz is talking to traders.

Susan, I bet you are getting an earful.

SUSAN LISOVICZ, CNN CORRESPONDENT: Well, the whole idea -- the whole topic, Don, of executive compensation is something that infuriates a lot of people on Main Street and Wall Street. And one of the people who is very angry about it is Teddy Weisberg, who has been on the street here for more than 45 years.

You think it is a huge mistake for the federal government to get that involved in the running of Wall Street. Explain that please.

TEDDY WEISBERG, SEAPORT SECURITIES: Well, I think it's a mistake for the federal government to be heavy-handed with any industry, and Wall Street would be just one of those industries.

I think -- you know, in terms of compensation, certainly in Wall Street, you know, people are paid historically very low salaries and they are compensated with bonuses. And they get those bonuses because they are producers. And producers, traditionally in Wall Street, at least, have been rewarded with bonuses and not high salaries.

Now, in terms of the banks, people tend to view Wall Street with a broad brush and that includes everything. I mean, the banks clearly are different than Wall Street firms, and my association is with brokerage firms these past 45 years.

But overall, I think, you know, in the -- in the Kennedy Administration, they went after the CEO of companies; in the Clinton Administration, they went after the drug companies; and every time the government has exerted this kind of heavy-handed approach on U.S. industry, it has not had good results. I mean, I understand the frustration and the problems. I'm not ignoring the issues. But I suspect more government intervention, not less government intervention, is not good for this country long term.

LISOVICZ: But Teddy, these financial companies lost a lot of money. There was so much leverage, so much risk. Yes, there are some producers. But there was also the need to come to Washington with hat in hand to get help from the federal government. Why do you think it's just not a bad idea, just to cap the salaries while they are, in fact, receiving the largess of taxpayers? WEISBERG: I think it's a philosophical -- it becomes more of a philosophical issue, I think, than a practical issue. And for me, the philosophical issue is a government that is heavy-handed and basically fiddling with the capitalistic system and trying to control it and put a lid on it, if you will, and deincentivize people from working hard and hopefully being compensated.

Now, I don't know what is too much compensation or not enough compensation. I mean, that's all in the eyes of the beholder. And it is true, I, of course -- that the government has come and assisted a lot of our large institutions, as well they should, because it is the cornerstone of the whole capitalist system in this country. We need the banks to function.

But I think if you disincentivize people, you are going to basically send a message that bright, educated, motivated people are basically not going to come into these businesses to help solve the problem. So, it's sort of a chicken and egg -- I don't know what the solution is, but people certainly should be compensated if they do a good job.

LISOVICZ: OK. Well, and there you have a debate, Don Lemon. I'm sure there are probably people yelling at the TV screen right now, because where are these people going to be going? When you disincentivize them, how many firms are ready to hire them, but Teddy makes the case that these bonuses should be paid and the government should not get that involved, because a messed up system could get even more messed up. That's his argument.

Back to you.

LEMON: Yes, it's interesting to put that in perspective. You know, people who work on Wall Street have a completely different perspective about it, because they're there and they know how it works, Susan. But the folks on Main Street are not really, you know, adept at that sort of thing, don't you think?

LISOVICZ: Well, yes, I think that's why it's a very, very good argument and it's a very impassioned argument.

LEMON: All right. Susan, thank you. And thanks to Teddy, as well.

Sixteen days into the Obama administration. The president admits, he, "screwed up." This comes after Tom Daschle withdrew his Cabinet nomination because of tax problems. In an interview with our Anderson Cooper, the president stressed there are no double standards.

(BEGIN VIDEO CLIP)

OBAMA: I campaigned on changing Washington and bottom-up politics. And I don't want to send a message to the American people that there are two sets of standards: one for powerful people, and one for ordinary folks who are working every day and paying their taxes.

(END VIDEO CLIP)

LEMON: Well, the Obama team's vetting process, arguably the most stringent ever for an incoming administration. A cnn.com article in November said it appeared meticulous and overly scrupulous, yet three people with tax troubles slipped through the cracks.

Let's talk to Ken Vogel in Arlington, Virginia.

KEN VOGEL, POLITICO.COM: Hey, great to be with you, Don.

LEMON: Ken writes for politico.com in Washington. And our national political correspondent, Jessica Yellin, is there, as well.

Hello to you, Jessica.

JESSICA YELLIN, CNN NATIONAL POLITICAL CORRESPONDENT: Hi.

LEMON: All right, let's start with Ken.

So, Ken, it seems -- here's the perception, that this is sort of a rookie move. To have this sort of stringent process, maybe 16 pages in the vetting process, but then to let this slip through.

VOGEL: Yes, well, let's not forget here, Don, this is a very comprehensive vetting process. And in fact, in all three cases with the back taxes owed -- with Nancy Killefer, with Timothy Geithner, and Tom Daschle -- those back taxes were caught somewhere in the midst of the vetting process before push came to shove and these nominations actually came up for confirmation. Barack Obama decided, his administration decided to move forward with them. So if anywhere, I think that's where the mistake was.

LEMON: Yes, OK.

You know what, Jessica, this is really -- I shouldn't say it's almost unprecedented. It's not unprecedented, but it seems like a lot of nominees here are falling out. Bill Clinton had two. If you look at -- he had Zoe Baird, his attorney general, and Bobby Ray Inman who was supposed to be in the Defense Department, Herschel Gober, Veterans Department. And then George W. Bush -- Linda Chavez, and we remember Bernard Kerik was a big deal. But not -- it was not this early on with so many folks.

YELLIN: Right. And one of the points that the Obama folks would make is that their nominees are falling victim to the Obama administration's tougher than ever new standards. They're a victim of their own morality.

LEMON: But here is the thing, if the standards are so tough, then how did they not find out about these problems early on?

YELLIN: I'd make two points about that. One is that the vetting process, as Ken is pointing out, is two steps. One step is flagging the problems. And along the way, in all these vets, they did become aware of these problems. So, it's not that the vetting process failed to identify these issues, it was the question of political judgment. Someone at a higher level after the vetters said, here, here are the issues, someone at a higher level said, you know what, those are big enough to stop us moving forward. We feel comfort with these guys in spite of this, let's move on. And so, as Ken points out, this, you could say, was a failure of political judgment.

LEMON: OK, Ken, it's definitely a PR problem and a perception problem, especially when it starts to make its way on to comedy shows and on to talk shows. Let's take a listen at just a couple, just from yesterday -- earlier in the week, I should say.

(BEGIN VIDEO CLIP)

WHOOPI GOLDBERG, CO-HOST, ABC'S "THE VIEW": The Democrats plan a big increase in highway funding, you know, as part of the economic recovery. And the president hopes to reign in almost a trillion dollars it will cost taxpayers.

Now, you know what, I move all of the country in my bus. I pay tolls, I have -- what is that thing -- the -- EZ Pass. Where does that money go? Do you know how many people are going over the roads in this country, every day, paying tolls? Who has got all that money?

ELISABETH HASSELBECK, CO-HOST, ABC'S "THE VIEW": I'll tell you who does.

GOLDBERG: Tell me.

HASSELBECK: I'll tell you, Tom Daschle has a lot of that money who -- needs to be paid. If they just collect his money, they could fix the roads.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP, "THE DAILY SHOW WITH JON STEWART")

JON STEWART, HOST, COMEDY CENTRAL'S "THE DAILY SHOW WITH JON STEWART": I do want to say a quick word to anyone out there to wants to bring change and hope to a deeply divided and suffering America. Pay your (EXPLETIVE DELETED) taxes!

(END VIDEO CLIP)

LEMON: Perception, PR problem, Ken?

VOGEL: Well, it's definitely a PR problem. And as President Obama pointed out when he made the rounds of the networks yesterday, he doesn't want to send the signal that he has sort of two standards. One for nominees, appointees in his cabinet, in his administration; the other for the rest of Americans who are forced to pay their taxes.

Now, the taxes, I don't think, are the real problem here, though. That's not inconsistent with his campaign rhetoric. He didn't go around saying, I'm not going to have an administration with any tax flaws in it. He said, I'm going to bring change to Washington.

YELLIN: Oh, but come on.

VOGEL: So, where the problem is, is that Tom Daschle, after he left the United States' Senate, went and made a ton of money, sort of cashing out in the way that President Obama...

LEMON: Ken, let Jessica get in here, because we are running out of time. Real quickly.

YELLIN: Well, look, it's a PR problem on the tax issue, because what is the problem with the Democratic Party that the folks aren't paying their taxes? This is not good for Washington and it's not good when the country feels that its leaders are an elite class that' out of touch with them. This cannot continue to happen. It is a problem.

LEMON: That'll have to be the last word.

Jessica Yellin, Ken Vogel, thank you very much. Have a good day.

VOGEL: Thanks a lot.

LEMON: As you just heard, President Barack Obama spoke with our Anderson Cooper, he did that yesterday, and we'll hear more about what the president has to say about the Daschle -- Tom Daschle, and the economy. That's coming up next hour right here in the CNN NEWSROOM.

The $3 million ad that brought in a two -- brought in two million customers. Our CNN iReporters were in line.

(COMMERCIAL BREAK)

LEMON: You know, there is nothing like free food to bring out the people. We know that right here in the NEWSROOM and people will eat it. Let's take a trip now to cnn.com's iReport desk and check in. And we're moving down there fast. One of the guys helping run things down there at our iReport operation, Producer Tyson Wheatley.

Tyson, did you get your free Grand Slam yesterday?

TYSON WHEATLEY, CNN.COM PRODUCER: No, I was already working. But you know, I mean -- that's right, Denny's does a Super Bowl commercial offering free breakfast for basically every American and guess what? Lot of people took them up on that offer. And, you know, yesterday we've got so many iReports from all over the country of lines spilled out. And basically we've only got time to show one to you. And this comes to us from Floridian Russell Spadaccini. And I'm playing this video mainly because of his cardigan.

Let's take a look.

(BEGIN VIDEO CLIP)

RUSSELL SPADACCINI, CNN IREPORTER: If you watched any Super Bowl Sunday, you know one very famous restaurant is absolutely offering a free breakfast to everyone in the United States. We're here at Denny's in Boca Raton where you can see a lot of people are coming in to get their free Grand Slam. Let's go in and check it out.

My Grand Slam is delicious. My Grand Slam is two fluffy buttermilk pancakes, two strips of bacon, two eggs over medium. And we all know how famous Denny's syrup and coffee is together. My Grand Slam is out of this ballpark.

(END VIDEO CLIP)

WHEATLEY: All right. Great video. You know, obviously this promotion by Denny's is really interesting considering the tough economy. What's really interesting is that how many people were just willing to stand in line. Some people up to an hour and a half in line just to get a -- basically, a $6.00 free breakfast.

And that kind of brings us to today's assignment, which has to do with surviving in this tough economy. And we've been hearing from people this week who are working seven days a week, who never take a day off. And I wanted to maybe just share a couple examples with you.

The first one comes to us from Kevin Fernandez. He lives in Pittsburgh. And he works his regular job at FedEx, but then he works on the weekends and nights at a grocery store to support his wife, a stay-at-home mom and their two kids. And he says he'll do whatever it takes to keep his family happy and healthy. And at this point, he's just thankful that his employer is cutting raises rather than having layoffs.

And I've got another one I want to share with you from Aaron Hash and he lives in Lancaster, Pennsylvania. And Aaron basically is working two jobs to support his daughter. He says he considers it a blessing because he knows some people don't even have a job right now. And you know, Aaron is working about 65 hours a week right now, and he's not the only one. These are just two examples of people.

So, if you're working seven days a week, we want to hear from you. We want you to share your stories at iReport.com today. If you never take a day off, tell us about it. Tell us about that story.

LEMON: Tyson, looks like the only two options are -- it's becoming more and more that you either work seven days a week or you don't have a job at all. So, there's no in-between this economy.

And by the way, you're talking about the iReporter with the sweater? You're usually wearing a sweater. So, what happened today?

(LAUGHTER)

WHEATLEY: You know, at some point you run out of argyle. And I'm trying to pepper it in where I can. Who knows? Maybe I'll have a surprise tomorrow.

LEMON: Yes, you could use a cardigan here today because it's so cold, but Florida -- not so much.

All right, thank you, Tyson. Always a pleasure to see you.

WHEATLEY: Take care, Don.

LEMON: Speaking of that, brutally cold temperatures in most of the eastern United States. Our Rob Marciano tracking it all from the CNN Weather Center.

(COMMERCIAL BREAK)

LEMON: We're talking about brutal cold in the eastern part of the United States. Our meteorologist Rob Marciano on top of that.

(WEATHER REPORT)

LEMON: President Obama's sit-down interview with Anderson Cooper. From terrorist threats to living in the White House, in the next hour of the CNN NEWSROOM.