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Burris Under Fire; Remembering the Victims; One-on-One with Colin Powell
Aired February 15, 2009 - 19:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)
SEN. ROLAND BURRIS (D) ILLINOIS: Hold it, hold it, please.
(END VIDEO CLIP)
DON LEMON, CNN ANCHOR: Ok, what was going on there? Was that on the record or was it a political disaster? A rowdy news conference, to say the least, from the man who replaced President Obama in the senate? We go to Chicago.
A doomed flight on auto pilot, should it have been? Well, the NTSB uncovers new information about what may have caused the crash of Flight 3407.
(BEGIN VIDEO CLIP)
LEMON: Did you cry?
COLIN POWELL, FORMER SECRETARY OF STATE: Yes, we all cried.
LEMON: Did you cry?
POWELL: Yes. Did you?
(END VIDEO CLIP)
LEMON: An African-American pioneer turns a table on this reporter, asked questions and opens up about race, family and personal feelings during a very candid interview.
Also, the sky is falling; deep in the heart of Texas, a true UFO, unidentified falling object. What the heck was it?
All this in the news, right now.
Hello, everyone. I'm Don Lemon.
Just in to CNN: People across California under all kinds of weather warnings right now. Bonnie Schneider in the Severe Weather Center with the very latest; not going to make for a good commute tomorrow, Bonnie.
BONNIE SCHNEIDER, CNN METEOROLOGIST: Not at all, Don. Bad commute certainly for the afternoon. This flash flood watch just issued for southern California. It includes Santa Barbara, into Ventura and Los Angeles counties and further south into Orange and San Diego region. We're looking at the potential for flash flooding as early as 10:00 tonight straight through Monday afternoon.
And that's not all. We're also tracking strong winds with this storm system that's bringing heavy rain to the Bay Area right now. Gusts could climb up to 55 miles an hour in and around areas of San Francisco and strong wind in L.A. tomorrow -- Don.
LEMON: All right Bonnie. We'll check back. Thank you.
We want to go now to another developing story.
The man who replaced Barack Obama in the Senate finds himself in an unfriendly spotlight tonight. Illinois Senator Roland Burris came under criticism for accepting the senate nomination from Governor Rod Blagojevich.
Now Burris has released an affidavit. It reveals details about his contacts with the governor's brother; contacts that Burris never acknowledged last month while under oath. The governor, as you know, was removed from office for allegedly trying to auction the senate seat to the highest bidder.
At a raucous news conference this afternoon, Burris denied any wrongdoing and he offered details on his conversations with the governor's brother.
(BEGIN VIDEO CLIP)
BURRIS: Rod Blagojevich reached out to me in three separate phone calls to ask for assistance raising money for his brother, then Governor Blagojevich. A fact I fully disclosed in my affidavit to the impeachment committee. I made it very clear to him that I would not contribute. That it would inappropriate and a major conflict because I had expressed an interest in the senate seat.
(END VIDEO CLIP)
LEMON: Well, there is a lot of ground to cover here, both legal and political. We're going to cover both angles with CNN senior legal analyst Jeffrey Toobin plus Lynn Sweet, Washington bureau chief for the "Chicago Sun-Times."
Lynn, I'll start with you. Why would Senator Burris even put himself in front of reporters today?
LYNN SWEET, WASHINGTON BUREAU CHIEF, "CHICAGO SUN-TIMES": That is a PR decision that some of his team might regret, because he didn't seem ready to deal with the reality of having a tough Chicago Press Corps ask him about what happened and his seemingly incomplete statement to the Illinois Impeachment Committee.
He didn't come out and have -- he didn't look confident. There's a lot of tape out there, Don that I'm sure could be used by an opponent against him in a political race. This press conference created a political problem for him. I'll let Jeffrey Toobin speak to the legal problems that lie ahead. It might not be as consequential as the political problems that he compounded. He looked anxious, he looked defensive.
LEMON: Yes and to your point, Lynn, I want to show -- and I want to get to you because you wrote a blog about him asking him many of the same questions -- some of the same questions that were asked today.
Like you said, he looked tense. Let's listen and look at this piece of tape here. And then I want to come back and talk to you.
(BEGIN VIDEO CLIP)
BURRIS: Good afternoon, members of the press.
UNIDENTIFIED FEMALE: (INAUDIBLE) Rod Blagojevich --
BURRIS: Just slow down. Slow down. Slow down.
(CROSS TALK)
I talked to all of those -- no.
UNIDENTIFIED MALE: You said you talked to friends.
BURRIS: Hold it, hold it, please.
UNIDENTIFIED MALE: You don't have three different versions.
BURRIS: Excuse me.
UNIDENTIFIED MALE: Let me finish please.
UNIDENTIFIED MALE: No, excuse me.
BURRIS: That is based on what you all are writing. You all are writing inconsistent information.
Thank you very much.
(END VIDEO CLIP)
LEMON: Okay, Lynn. You know, I was sitting here in the "Newsroom" and a lot of people and also some e-mail I got. A lot of people were surprised by just how tough the Chicago Press Corps is. No surprise to you or no surprise to me as well. It's par for the course.
Also you talked to him about it, asked him the same question. You said that anyone -- do you think that anyone ever actually talked to the governor? Are you concerned that it might be with the wiretap? Do you know of any phone conversations that might have surfaced from anyone on your team?
And he said, "No, not that I don't know about that. But definitely there was no pay-for-play involved because I don't have no money," is what he said and then laughter here.
Talk to me about that. Do you think that his statements are inconsistent?
SWEET: I think he's his own worst enemy right now, Don. That was January 7th when he did a press conference before he was appointed to the senate. He said stuff that clearly today just wasn't true. And he gave incomplete testimony to the house impeachment committee and people should know this is important before he was pointed senator.
LEMON: Okay.
SWEET: He amplified it and nailed down the details after he was the senator. Can I make one more point?
LEMON: Yes, go for it.
SWEET: Another point I want to make is, he has, when you parse the testimony, and in fairness to him that's allowed -- and that's why I think it's a legal problem -- might that be that well -- he did say at some point to the questions did you talk to so-and-so and so-and-so? He said yes and then went one to talk to one person.
A reasonable person might think that he was only saying yes to one person but another person might say it was to all the names. He could have -- I suppose come out and had a statement and talk about his strongest point.
What you saw here was the closest equivalent to a political meltdown that I've seen. It just is going to create an enormous problem.
One other thing, he was supposed -- he is scheduled this week to go on a tour, his first swing throughout Illinois as the senator. It will be interesting to see how he does in this context. Believe me the Illinois Republicans and very aggressive, properly aggressive Chicago Press Corps probably won't be giving up on this one.
LEMON: And see how he is received. Lynn Sweet, thank you. We're going to delve into this at 10:00 p.m. Eastern.
Lynn Sweet, the Washington bureau chief for the "Chicago Sun-Times" will join us then.
Meantime, let's talk about the legal aspects of this with Jeffrey Toobin, our senior legal analyst. Any legal exposure here Jeffrey? Can he be indicted for inconsistencies?
JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: Well, you certainly can be indicted for lying in sworn testimony to a state impeachment hearing. And that is the issue here.
Based on what the information that I have seen and that's publicly available at this point, I don't think he has much of a legal problem. I think a criminal case has to be based on a completely false statement. Not an ambiguous statement, not a statement that can be seen different ways. It has to be completely false. I think he is unlikely to have been found to do that.
LEMON: All right. Our senior legal analyst Jeffrey Toobin; Jeffrey, we appreciate it.
We go now to the plane crash in New York.
(SINGING "AMAZING GRACE")
LEMON: Remembering the victims of Thursday's commuter plane crash near Buffalo, New York, special memorial services were held at churches across the area today. This was at Clarence Center Methodist Church in the town where the plane crashed killing 50 people, destroying a home and shattering a quiet neighborhood.
We know more tonight about what happened to Flight 3407. Three things right off the top: we learn the plane was on auto pilot and while the NTSB discourages the use of auto pilot in severe ice conditions, officials say there was no sign of severe icing at the time of the crash. The NTSB wrapped up a news conference just a short time ago where these new details have come to light.
Meantime, investigators are busy removing debris and they have begun the hard task of interviewing family members and removing victims from the wreckage.
(BEGIN VIDEO CLIP)
STEVEN CHEALANDER, NTSB: The medical examiner believes that three to four days are going to be required to recover the victims of this crash. And they're in the process of doing that.
They've already pulled some of the folks out of there but they have a long way to go. It's a slow process but we are making progress.
(END VIDEO CLIP)
LEMON: We also learned just how fast this tragedy happened. It happened quickly. The plane dropped 800 feet in five seconds, just before impact.
Let's get now to Justin Green. He is an aviation attorney. He has litigated dozens of major aviation cases. He's also a former military pilot and holds a commercial pilots' license. Justin, thank you for joining us today.
JUSTIN GREEN, AVIATION ATTORNEY: Thank you Don.
LEMON: This new information that we're getting from the NTSB that it probably should not have been on auto pilot, that the pilot should have been working the controls at the time. How does this play into what your hearing about what may have cost this crash?
GREEN: If you look at the problem of auto pilots and icing, it has a long history. The two accidents I talked to you about yesterday both implicated auto pilots. The problem with auto pilot is the auto pilot kind of fixes the problem with the ice up until it can't do it any longer. In other words, it masks the problem.
If you're flying manually, you're going to feel the ice on the stick or on the yoke in this aircraft. It's going to feel mushy. It's going to fly like a pig and that's going to tell you, you better get out of the icing conditions.
LEMON: 800 feet in five seconds, Justin? My goodness, talk to me about that.
GREEN: It's terrible and it's consistent with what we've seen in other icing accidents. It's just an airplane that basically is out of control.
LEMON: This new information, does it lead the investigation into a different place now about this auto pilot versus the pilot?
GREEN: No. It's all related. The auto pilot problem has been known for a long time. So they're going to look at when the auto pilot was actually put on, how much of it was being used during the flight. It's also, I think possibility that the pilot may have turned the auto pilot on to try to save the flight at the last minute.
LEMON: Yes and we shall see coming up as they continue to investigate this. New information is always great, Justin Green, we appreciate you joining us again today. Thank you sir.
GREEN: Thanks a lot, Don.
LEMON: Take a look at this, it is a fireball today over Austin, Texas. A cameraman, his name is Eddie Garcia of local affiliate News 8 Austin was filming a marathon when the mysterious object streaked out of the sky. CNN spoke with him about his amazing video.
(BEGIN VIDEO CLIP)
EDDIE GARCIA, NEWS 8 AUSTIN: When you see something like that, you don't really know what it is. You just stare at it for a little and then you just wonder for the next five minutes, what was that? For me, I wanted to make sure that I got that on tape. And I sure did.
(END VIDEO CLIP)
LEMON: Yes, he certainly did and everyone is playing it in all the major networks. It's an unbelievable piece of tape. There is speculation, speculation that the debris is from a pair of satellites that collided several days ago over Siberia but that has not been confirmed -- not been confirmed. We're going to check into it.
So far, there's no indication it actually hit the ground. The FAA says it has gotten numerous reports of fallen debris across Texas.
He tried the bipartisan approach with Congress but that didn't work out so well. So President Obama is getting far away from Washington this week.
Also tonight, California on the drink of bankruptcy: legislators are working overtime over a long holiday weekend to try to balance an overblown budget.
We want you to be part of our conversation; part of our newscast. Logon to Twitter, Facebook, Myspace or iReport.com; give us your comments. We want to get them on the air.
(COMMERCIAL BREAK)
LEMON: President Barack Obama is heading back to the campaign trail. This time he is not running for the White House. He's stumping for his political agenda. Will it work again?
Here's our White House correspondent Suzanne Malveaux.
SUZANNE MALVEAUX, WHITE HOUSE CORRESPONDENT: Well, Don, today the president got a chance for a quick pickup basketball game with his friends. He also got his haircut with his favorite barber. And yesterday a romantic dinner for Valentine's Day, a place called Table 52, a favorite restaurant of theirs.
This week it is all about getting back to business and obviously the urgent focus is on the economy.
(BEGIN VIDEOTAPE)
MALVEAUX: A quick glimpse of the First Couple leaving a Chicago restaurant after sharing a Valentine's dinner. The private weekend at home will give way to a very public PR campaign this week as President Obama hits the road.
First, to Denver on Tuesday to sign the $787 billion economic stimulus legislation. The point, to put the president in front of real people to convince them the jobs will eventually return.
ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: Things have not yet bottomed out. They're probably going to get worse before they improve. But this is a big step forward toward making that improvement and putting people back to work.
MALVEAUX: Not everyone is buying that. Only three Republican senators supported the massive stimulus plan and despite the president's outreach to Republicans, Mr. Obama's former rival John McCain is giving him bad marks.
SEN. JOHN MCCAIN, (R) ARIZONA: I'm not happy and most of us aren't, at the lack of true bipartisanship in approaching this legislation.
MALVEAUX: Wednesday, Mr. Obama is heading to McCain's home state of Arizona to lay out his plan to address the housing crisis. McCain will be in Arizona that day but says he's made other previous plans.
The state has the third highest home foreclosure rate in the country. The administration's housing plan is aimed at stemming foreclosures and driving down mortgage rates.
SEN. MCCAIN: We have to get back to stabilizing the housing prices, buy up these bad mortgages, give it to people that can afford the housing so they can stay in their homes.
MALVEAUX: Also on the president's urgent agenda, filling two cabinet positions recently rocked by scandal. Aides say that's going to take some time.
DAVID AXELROD, SENIOR ADVISER TO THE PRESIDENT: Choosing cabinet members isn't like "American Idol." You don't throw contestants out there and let the American people vote.
(END VIDEOTAPE)
LEMON: Suzanne Malveaux traveling with the president.
President Barack Obama is using Denver as a backdrop when he signs the stimulus package. Why Denver? And what is the Mile-High City hoping to get out of the stimulus plan? I'll ask the mayor's chief of staff in the 10:00 p.m. hour right here on CNN.
Make sure you tune in for that.
Speaking of Denver and the president going out on the road to sell that stimulus plan, let's talk about the faces of this recession right now. Whether they are friends or family, neighbors or co-workers, chances are you know people who are looking for jobs or cutting back. Even an NBA hall of famer is feeling the pain.
CNN's John King sat down with Magic Johnson and other NBA stars in Phoenix, site of tonight's All-Star Game.
(BEGIN VIDEO CLIP)
MAGIC JOHNSON, NBA HALL OF FAMER: I grew up in Michigan. Father, two brothers worked 30 years for general motors. Ok? I'm in it, even right now as we speak.
I got relatives who now, whether they got laid off, are worried that they're going to get laid off, friends whose parents are going to get laid off. They're going to get laid off and have been laid off. I don't mean to cut Grant off but I'm in the middle of it right now as we speak.
Michigan is devastated. We're going to have a major crisis for at least two years, even with the president's great plan. It's going to still take probably 18 months to two years before it can take effect. We're still going to have that long for people to suffer.
(END VIDEO CLIP)
LEMON: John King's conversation with Magic Johnson and other NBA greats plus Senator John McCain blasts the stimulus plan; all that and more next hour.
It is the best of "State of the Union." It airs at 8:00 p.m. Eastern only here on CNN, right after this broadcast.
Paving the way for change. (BEGIN VIDEO CLIP)
POWELL: I'm more impressed by those who came before me who could have done the same thing I did but they didn't have the opportunity because of racism and segregation and Jim Crow-ism, but they still fought.
(END VIDEO CLIP)
LEMON: You want to stick around for this; my exclusive conversation with Colin Powell, an African-American first, about the people who inspired and continue to inspire him.
(COMMERCIAL BREAK)
LEMON: The election of Barack Obama as the first African-American president, an incredibly powerful and moving moment in America's history.
Among the millions of people overwhelmed by its significance was Colin Powell, a pioneer really in his own right. Last week I asked the former secretary of state about the people who helped pave his way.
(BEGIN VIDEOTAPE)
LEMON: How are you doing?
POWELL: Fine, how are you?
LEMON: It's good to see you. Thank you for doing this.
POWELL: My pleasure.
LEMON: It is my honor to be sitting here with you. This thing called African-American First; you were a first in many ways. What do you think about the new first that we have?
POWELL: Well, you can't really go any higher than this now. So we're going to have to stop thinking about firsts and thinking about our fellow citizens, many of whom are African-American and Hispanic and rural kids who are coming along and see these firsts. First secretary of state, first chairman, first national security adviser and now we see the first president who happens to be African-American.
But we can't think that, well, everything is well now, we've got it. We've got a black president. We've got to think about the other members of our society, many African-Americans, especially, who are still in need and they are not first.
We have 50 percent of our young black kids who are not going to be first anything because they haven't graduated from high school. They're dropping out, particularly in our inner cities. And so we should be so proud of how far we have come in the last 50 years so that we now have a man who is president, who is African-American but let us not rest on that pedestal. Let's recognize we have a long way to go. Not too long ago I spoke at the Ole Miss, University of Mississippi, which 46 years ago they stood in the doorway and wouldn't let a James Meredith, a former air force sergeant come into the school. It took the President of the United States, the 82nd Airborne Division and 101st Airborne Division to get this one black man through the doors of Ole Miss and they had to guard him for a year.
Then some 40 years later they celebrated that event by doing it again and having James Meredith walk through the door a, accompanied by the leadership of the school. And when you see Ole Miss as I spoke to this audience, black, white, Hispanic, Asian, everything -- all the colors and diversity of our great country. So we've come a long way but we can't rest.
LEMON: What does that mean to you personally to see that? Do you feel like that you in some way contributed to where we are now? That moment, this new president?
POWELL: I think I did. But I'm not bragging about it because hundreds of thousands contributed. I contributed in a visible way by becoming the first secretary and first national security adviser and chairman who is black but I was given that opportunity.
I'm more impressed by those who came before me who could have done the same thing I did but they didn't have the opportunity because of racism and segregation and Jim Crow-ism but they still fought. They did the best they could.
LEMON: Like who?
POWELL: I'll give you a perfect example. We recently buried a wonderful lady, Martha Putney, who was a lieutenant, a black lieutenant in the Women's Army Corps in World War II. She insisted on being treated as a lieutenant in the United States Army and she fought for her rights and she demonstrated just by her performance what a black woman could do.
And that little microcosm of what's been happening across our society by showing the rest of Americans that we are just like everyone else. You give us the education, you give us the opportunity, you open up the avenues and we're coming along. My fear is that we don't have enough kids coming along who have got the education and determination to take advantage of what's been created for them.
Yes, I think what Mr. Obama was able to achieve, many people helped him get there. But not just visible people like me, hundreds of thousands of African-Americans who did what they could in their time over our history.
(END VIDEO CLIP)
LEMON: Former secretary of state Colin Powell. That is not all we discussed. Has the U.S. become a post-racial nation? We'll explain that question and get an answer much, much more of my one-on-one conversation later on in this newscast; about 20 or 30 minutes from now. Meantime, you guys are writing in, some of you writing in about Roland Burris. You're writing in about a lot of things that we're putting on the air.
Here's what Joseph Jones says: "I believe him. His past history speaks for itself." Chicago Politics, one phrase, "Show me the money."
KMiley says, "Burris has changed his story too many times to suit his own purposes to be believed."
Tom b: "At the least he needs to be investigated.
Susan S. Smith says, "Senator Burris knew going in he must be straight up and no flip-flop. He brought this on himself and will always be under a cloud.
We want you to be part of our newscast; part of our community here. Logon to Twitter, Facebook, Myspace or iReport.com; we will get your comments on the air.
Thank you so much for doing that.
Troubled times now in California; legislators are working overtime, some sleeping on their desks -- there are a couple right there -- as around the clock budget negotiations continue.
And after the crash of flight 3407, what rights do the victims, the families of the victims have? We're digging much deeper into this story.
(COMMERCIAL BREAK)
DON LEMON, CNN ANCHOR: Live shot right here in the CNN Center.
Welcome back to the news everybody. I'm Don Lemon. Here's what's happening right now, Roland Burris, Barack Obama's replacement in the Senate wants to set the record straight. He invited Chicago media to a news conference today after confirming that he was asked to raise money for then Illinois Governor Rod Blagojevich, the man who appointed him.
But Burris says he didn't donate a single dollar, his words. The Q & A got a little heated. I want you to take a listen.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Rod Blagojevich (inaudible)
SEN. ROLAND BURRIS (D), ILLINOIS: Just slow down. Slow down. I mean, I talked to all of those - UNIDENTIFIED FEMALE: you said you talked to friends.
BURRIS: Hold it, hold it, please.
UNIDENTIFIED MALE: You don't have three different versions.
UNIDENTIFIED MALE: I'm sorry. Let me finish, please.
BURRIS: Excuse me.
UNIDENTIFIED MALE: No, excuse me.
BURRIS: That is based on what you all are writing. You all are writing inconsistent information.
Thank you very much.
(END VIDEO CLIP)
LEMON: One of the more interesting press conferences that we have seen in a long time.
Here's another story we're following, the deadly crash of that commuter plane outside Buffalo, New York. The NTSB, the National Transportation Safety Board, wrapped up a news conference just a short time ago where new details have come to light. We have learned the plane was on auto pilot. While the NTSB discourages the use of autopilot in severe ice conditions. Officials say there was no sign of severe icing at the time of that crash.
Well, aside from that horrible task of having to notify family members there is the business of rights and compensation for the victims of loved ones. Loved ones of the victims. And that's one of the next steps, ahead in this process. Gale Dunham joins us now. She's with the nonprofit National Air Disaster Alliances. It's an organization that represents survivors, those who have lost loved ones, aviation professionals, the traveling public and those impacted by world disasters, disasters world wide when it comes to aviation.
Thank you so much for joining us. You heard the new information, Ms. Dunham today about whether it was on autopilot or not on autopilot. Does this make a difference in compensation of the victims or in victims' rights?
GALE DUNHAM, NAT'L AIR DISASTER ALLIANCE: Family members always have a need to know. They often become experts about their own air crash investigation. One of the provisions of the Family Assistance Act is that family members have direct briefings from the NTSB so they're able to have direct and accurate information. They have a place to go. Then they - this is a very long process. This investigation could go on for a year, two years. It's a long process. Family members need to slow down and be able to take in this information.
LEMON: And it's very important as you said about getting briefings from the NTSB. Because you know, there's a lot to filter out there in the media. And the media can't contact them during their time of grief, at least for a while.
DUNHAM: Well, the Family Assistance Act also provides that the NTSB will notify family members individually especially about closer to the end of the investigation about the final report. And this flight should definitely have a public hearing. But they need to kind of pace themselves.
There's a lot more to come out. They're going to learn again and again, this was a preventable disaster but just pace themselves for the long term until they have a thorough and complete investigation.
LEMON: 45 days, the media cannot contact the families. Talk to us about the challenges that the victims' families are often faced in the days and moments right after the crash?
DUNHAM: Well, the Family Assistance Act provides that attorneys may not contact the family members for 45 days. I think the media, you know, as much as you want to do those interviews, I think you're still trying to have some discretion about when to contact people. Because there's an enormous amount of grief. But there's 45 days, the attorneys are not allowed to contact family members. And again, that's to give family members that time so they don't have someone telling them that they have to do something, take their time, think about it. Prepare themselves for a year of learning more information.
LEMON: OK. Yes. Ms. Dunham, thank you for clarifying what I said. It is the attorneys, not the media. I appreciate you setting me straight on that point. And I thank you for joining us today.
DUNHAM: Well, thank you. We need the media also to share the story.
LEMON: Yes, thank you so much.
DUNHAM: Thank you.
LEMON: Have a good evening.
Working all night and all the day really and maybe all night again over a long holiday weekend. Look at they're dozing at their desks. That's right. California legislators ended up sleeping at their desks last night. They could be locked in for a bitter budget battle even tonight and on and on and on until this could settle. There's no easy fix in sight. We'll report.
(COMMERCIAL BREAK)
LEMON: OK. Even a rare all-night session hasn't been enough. California lawmakers still can't agree on a budget. The deal that includes huge tax hikes and painful spending cuts there. The state faces a massive $42 billion budget deficit. Governor Arnold Schwarzenegger is trying to do a little arm twisting as we speak, trying to do it right now. The state Senate is three votes short of what's needed to pass a budget.
Well, some store owners are worried about new taxes, they say business is already slow enough. (BEGIN VIDEO CLIP)
BOBTUNER, FURNITURE STORE OWNER: This is uncharted waters. We've never seen months that were so slow. People just aren't coming in the store. And the ones that do come in, they look around but it's easy not to buy furniture right now.
(END VIDEO CLIP)
LEMON: Easy enough not to buy a whole lot of stuff. Our Kara Finnstrom is following this story. She interviewed that store owner, you just heard from just a second ago and she joins us now from Los Angeles. Good to see you, Kara. I got to ask you, things must be really bad if they're working through a holiday weekend and California lawmakers. Could the state really run out of cash?
KARA FINNSTROM, CNN CORRESPONDENT: Yes. California has been hit hard by this recession. The state's unemployment rate is now at 9.3 percent. That's well above the national average. And this is a state that's been rocked by home foreclosures. What's happened here is less and less state revenues have been coming in and the state has not adjusted it's spending.
In fact, it's actually taken out more and more loans to cover its shortfalls. So much so that right now California's credit rating is so bad that it can't continue to cover its losses in that way. So lawmakers have found themselves now with their backs against the wall.
LEMON: Yes and really interesting. I mean, I've been getting e-mails from folks saying you know what California owes me money from my taxes and all I've gotten is an IOU. And I don't know if I'll ever get it. So how will the people who live there in the state be impacted if this budget doesn't pass? I would imagine that's one way.
FINNSTROM: Yes, worst case scenario right now is the governor is saying the state will run out of cash. So he's threatening to lay off 10,000 state employees. And as you've mentioned, those IOUs have already gone out, instead of the state refunds to people who have filed early enough. If the budget does pass, now we're still talking about a lot of agencies seeing huge cuts.
And so layoffs may result because of the budget. And we may especially see a lot of those pink slips going out to teachers. And the other fact which you've touched on earlier, Don, is that if the budget passes as it's proposed right now. There are going to be some taxes, namely an increase in the sales tax and increase in the gas tax. And for people who are already struggling, it may be a little tough.
LEMON: Kara Finnstrom, thank you very much. Even if they do get it passed, there's probably going to be some layoffs and some other repercussions. We appreciate it. Thank you.
FINNSTROM: Certainly. LEMON: More aftershocks in the massive Salmonella outbreak linked to peanut products. It's having a terrible impact on the entire peanut industry. Last year's crop was a record 2.6 million tons. But peanut butter sales are down, 22 percent in the last month or so.
22 percent down. Customers appear to be avoiding peanuts in almost every form, even though the company I should say, the center of the Salmonella investigation, Peanut Corporation of America handled less than three percent of all peanuts processed.
Boy, it's a slam dunk. The NBA is hoping the economic downturn won't be a game-ender. We'll tell you what they're planning to do to keep the fans in the house.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Look at the left hand. Jumped up.
UNIDENTIFIED MALE: Oh! Ow!
(END VIDEO CLIP)
LEMON: That's Nate Robinson of the New York Knicks. With the leap that made him the winner of last night's slam dunk contest at the NBA's all-star weekend. That was beautiful. Look at that dance right there. In case you were wondering he is 5'9". That was pretty cool. 5'9" tall and he jumped over Dwight Howard who is 6'11". Who says little guys don't stand a chance?
Spectacles like this are a real slam dunk for the struggling economy and for the cities that host them, and we have two mega events today, the Daytona 500 earlier. We got some news on that and the NBA all- star game just minutes away. And it's not just about basketballs and cars and racing. It's about a huge infusion of cash, really. Rick Horrow joins us now.
Hello, Rick Horrow. How much cash are we talking about for the host cities, big or small city?
RICK HORROW, SPORTS BUSINESS ANALYST: A lot. First of all, congratulations on your fledgling career as an NBA slam dunk commentator. That was pretty good.
LEMON: Did you like that?
HORROW: Once.
LEMON: What did I do wrong? Did I do anything -
HORROW: Too long.
LEMON: OK. Go ahead.
HORROW: So here's the bottom line of all of this. About $80 million of economic impact for the valley of the sun and the NBA. But it's sponsors, it's Sony, it's Right Guard, it's E.A..
LEMON: Yes.
HORROW: It's McDonald's and the NBA's attendance is up. People are watching. The all-star game starting today, that is mega event number one.
LEMON: OK. Listen, NBA Commissioner David Stern this statement. Let's put it up. I'm not going to read all of it but it says, he says, talking about the economy "I can predict nothing other than to say that we worry a lot and we offer to assist our teams" and then he goes on to say, "I feel almost insignificant talking about it compared to some of the suffering that is going on out there." Talking about the possibilities of a big economic storm in the NBA.
OK. So if he says this, you know, what is he talking about? Why is he responding to this?
HORROW: Well he's responding to it because of his staff layoffs and the inevitable argument that it's just sports and it's not important in the economy. But look, the NBA plays its part. They're generating substantial dollars. It's about $100 million of payroll per team. Plus the economics we talked about the all-star game and then we get into NASCAR because we're lucky enough to have that second mega event today that just finished.
LEMON: Yes. That's right.
HORROW: You have the winner. Don't you?
LEMON: Yes, big day - no, I'm going to let you do that because you're the sports guy. There's an impact in sports with the big three automakers in trouble. And just so you know, the winner driving a Ford. So go ahead and tell us about the winner. I know who it is. But I'm going to let you do it.
HORROW: Matt Kenseth wins a rain-shortened race. The big automakers do reduce their sponsorship by about 30 percent. But let's remember, NASCAR's economic impact is huge as well. $200 million in central Florida and yes there's sponsorship reduction but 20 major blue chip sponsors are in the Daytona and NASCAR scene. ask.com, AFLAC, now in a big way. So as many sponsors drop out or reduce, we got more sponsors in. Why? Because people love to buy NASCAR stuff.
LEMON: Yes. Let's see if it will help the big three. Matt Kenseth driving a Ford, winner of the Daytona 500. And Rick Horrow in the house. Thank you, Rick.
HORROW: All right. Talk to you later.
LEMON: All right. Talk to you later.
HORROW: Bye.
LEMON: Crossing the color line and making history.
(BEGIN VIDEO CLIP)
COLIN POWELL, FMR. SECRETARY OF STATE: Hit me? It hit me emotionally. I suspected it. I supported him. I voted for him but it was still an electric shock.
(END VIDEO CLIP)
LEMON: Colin Powell shares his emotional thoughts on Barack Obama becoming the first African-American president, moments away.
(COMMERCIAL BREAK)
LEMON: "Up from a past, African-American firsts." On November 4th, 2008, voters made history and the U.S. entered a new era but is it truly a post-racial era? That's what I asked former secretary of state Colin Powell in our exclusive conversation last week in Washington, D.C..
(BEGIN VIDEOTAPE)
LEMON: There are those who say that you know, it's over, you know, we don't need certain sorts of programs, affirmative action, what have you, but racism is over in this country because of the election of Barack Obama.
POWELL: It isn't. Racism is not over. We have to be candid. I was so happy that Americans came to the polls, went to the polls. And a lot of people said those white folks they will say they're going to vote for Obama, they'll go in the booth and they won't. Well, it turned out most of them did.
10 million more Americans voted for Mr. Obama than my dear friend senator McCain. But there were places in our country where white folks voted for Mr. Cain up to 88 percent of them. So there is a racial element there.
And black folks voted up to 98 percent for Mr. Obama. So we have not become a raceless, classless society yet, not when you go into our inner cities and see young African-Americans who don't have good schools, who don't have job opportunities, are in need of health care, in need of better housing, and so we should use Mr. Obama's presence, President Obama's presence as an indication of how far we have come but also as inspiration to go even further.
LEMON: That was a very personal moment for you. Did you cry?
POWELL: Yes, we all cried.
LEMON: You cried?
POWELL: Yes. Did you?
LEMON: I was busy working. I was emotional. I can't say that I did cry. But there was a moment when it hit me when I was here in Washington, when he got out of the car and walked with his wife. But you cried. Tell me about that moment and why. POWELL: I was in Hong Kong. I was not in the United States. I voted early. And I was in Hong Kong. And it was morning in Hong Kong when it was evening here in Washington. And I'm getting up, getting ready for the meeting I'm going to in Hong Kong and I'm watching the news. All of the broadcasters giving results, New Hampshire's done this, New York's done this.
The exit polls remain to say this. As I'm getting dressed, watching television, I'm talking to my wife who was in Fairfax county, Virginia with my son and daughter in law and I'm texting with one of my daughters in New York. So the whole family is watching this, even though we're 8,000, 9,000 miles apart. And we saw the results start to come in. And I remember 2000 when it took five weeks. I remember 2004 when it took all night.
And as I'm waiting for the results to come in. Suddenly, one of your colleagues on another channel that I happened to surf to says we have one more exit poll to report. And he simply said Barack Obama is the next president. And it hit me. It hit me emotionally. I was expecting it, I supported him, I voted for him but it was still an electric shock.
I just sat down in my chair. My kids were crying and I said to myself, we did it. We actually did it. What a great country. What a great inspiration to all Americans and what a great inspiration to the world. Because many people in the world thought America can't - they're not ready for this. They won't do it.
LEMON: You're emotional about it now. You're almost crying. Why?
POWELL: Every day. I don't know why. Maybe it's because I remember the days when a young black kid growing up in the Bronx could only look to a Joe Lewis or Ralph Bunch or to a Jackie Robinson for inspiration. Maybe it was because even though I grew up in an integrated neighborhood in New York City, I knew I was a second-class citizen.
I've been telling a joke recently that trying to convince people of the changes we had gone through, that I remember as a young kid in the Bronx hearing one day in the early '50s, I was a teenager. And we all were sitting on the corner stoop and we heard, hey, did you hear? What, man? Did you hear that it was Greyhound or trail ways, I can't remember which one, did you hear the Greyhound hired its first black bus driver in the south. They're going to let a black man drive a bus down the interstate in the south.
We said, whew. Then we all kind of smiled and kidded and said, Lord, I hope he don't have an accident. You know what the white folks will say. We felt that insecure about ourselves. Because we were taught for 200 years to feel inferior and insecure about ourselves. But things were changing. And I got an education that allowed me to be not insecure about myself. I went into an institution in the United States Army that was ahead of everybody else.
And they said to me, the only thing we care about is performance. We don't want to hear about your immigrant background. We don't hear about you being a poor kid. We don't want to hear about the fact that you're black. The only thing we care about is performance. You ready? I said, yes, I'm ready.
LEMON: What do you think Lincoln - it's his 200th birthday, this big celebration going on, the new president has this whole connection to Lincoln. Do you think, do you feel he was a great emancipator?
POWELL: No question, he was one of our greatest presidents, not just a great emancipator. He had a more important role than just to emancipate. He had to keep the country together. That was his first goal, to preserve the union and the process of doing that, he emancipated the slaves as part of his efforts to preserve the union. And we should thank him for preserving the Union and emancipating the slaves.
It's unfortunate that we lost a president like him because I think the whole reconstruction period would have been entirely different. And the great tragedies of our country is that after that war that preserved the Union and ended slavery was able to slip back into a position of racism, Jim Crow's segregation and all the other terrible things that happened for the next 100 years until we had the second civil war, a more peaceful civil war led by Dr. Martin Luther King.
So I think Lincoln will always be seen as a great president. I regret that we lost him too soon eight soon and we perhaps lost some opportunities to have avoided that second civil war or at least had it earlier so that all Americans could have been equal much earlier than we are now on the verge of doing.
LEMON: Do you think his legacy has been romanticized?
POWELL: No. I don't think so. I think he's very deserving of all of the tributes that he's getting especially on the 200th anniversary of his birth. I'm a great admirer of President Lincoln.
(END VIDEOTAPE)
LEMON: I really enjoyed doing that. Former secretary of state Colin Powell. I've never seen him more candid and relaxed in an interview. Thank you, sir, for doing that and for opening up to us.
You guys are responding to that interview as well. Here's what lucca said. Colin Powell is an excellent man. It must have been a great honor to get to interview him.
Yes, it was. Thank you, sir. GGT, Mr. Colin Powell is totally right. We should certainly not rest now. Doc Marty says at this point I don't think we can afford to lose a democrat, no matter what. Republicans have done much worse and are still there. Talking about Roland Burris in that one.
Craigdenton said all the propositions California voted in hamstringing their state economy and anyaisabel says we need to move on, way too much going on in the economy to worry about Burris.
We always want to know what's on your mind. We want you to be part of our community, twitter, Facebook, myspace, i-report.com and tell us what you're thinking.
So glad you joined us today. We'll see you back here at 10:00 p.m. Eastern. I'm Don Lemon at the CNN world headquarters in Atlanta. Why don't you join my friend John King right now for "State of the Union."
