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Obama Proposes Plan to Fix Housing Crisis; More Troops Sent to Afghanistan; Powerful New Superbug Spreads Through Hospitals; Debate over New Deal's Effect on Depression

Aired February 18, 2009 - 13:00   ET

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

KYRA PHILLIPS, CNN ANCHOR: We're pushing forward with the foreclosure fix. You just heard the president plans to slam the door on the housing crisis. Better, cheaper, safer mortgages just around the corner for some. Find out where you stand in the CNN NEWSROOM.

And a new push in Afghanistan, or is it a surge? Thousands more U.S. troops gear up to take on the Taliban. We're surveying the battlefield.

Hello, everyone. I'm Kyra Phillips live at the CNN world headquarters in Atlanta. You're live in the CNN NEWSROOM.

A Washington man's home at risk. Not foreclosure, though. Forced entry. Crooks hitting his valuables, so he hit the brakes on their break-in. We're going to tell you how he out-smarted the bad guys and why he's getting high fives from 5-0. Seriously, guys, this one's a classic.

But first, if you have a mortgage, you're either current, delinquent or out in the cold. Two of those groups have major stakes in the homeowner rescue plan that President Obama just presented in Mesa, Arizona. It aims to prevent foreclosures by helping, coaxing, pushing lenders to rework or refinance burdensome mortgages.

Cost to taxpayers: $75 billion. Estimated impact: 9 million households, not including folks who already lost their homes.

CNN's Suzanne Malveaux is traveling with the president, crunching the numbers for us.

Suzanne, how is the plan different from all that we have seen and tried before?

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Kyra, it's quite different. One of the things, it's not voluntary. There actually are -- there are some teeth in some of these programs that President Obama has introduced.

One of the things, offering some government subsidies to mortgage companies to try to encourage them to lower those monthly payments, that that is something that they are trying to work with Fannie Mae and Freddie Mac. Also creating a program that actually allows homeowners who actually own more than the value of their home to refinance. That is something that has never been offered to homeowners before. But the thinking is that, if the value of your house goes down and it's no fault of your own, you should not be penalized.

Another aspect of this also is legislation to change bankruptcy laws to allow judges to actually change or alter those mortgage rates.

These are just some of the things that the government, the president, has laid out today. It does have some teeth in working with Fannie -- Fannie Mae and Freddie Mac already receiving some government subsidies.

And I want you to know, Kyra, that one of the things that he really stressed is that he is not rewarding bad behavior, that he's trying to help folks who really, because of no fault of their own, have gotten into this mess. Take a listen.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The plan I'm announcing focuses on rescuing families who played by the rules and acted responsibly: by refinancing loans for millions of families in traditional mortgages who are underwater or close to it; by modifying loans for families stuck in subprime mortgages they can't afford as a result of skyrocketing interest rates or personal misfortune; and by taking broader steps to keep mortgage rates low so that families can secure loans with affordable monthly payments.

(END VIDEO CLIP)

MALVEAUX: And Kyra, the reason why he's here in Arizona, obviously, to make the point in front of real people that this is a crisis that is affecting so many people, and Arizona is the third highest foreclosure rate in the country. Some 117,000 people lost their homes last year. Here in Phoenix, that number's about 40,000. And in the -- just in the small opportunity of Mesa, 310 families just last month lost their houses.

So this is a community that is really suffering. They are listening very closely to what the president has to say, and they certainly hope that some of these plans here that he's outlined are going to work, Kyra.

PHILLIPS: And we're going to try and talk about that plan to the best of our ability. Suzanne, thank you so much.

Here's what we still want to know. If you're on the brink of foreclosure, where do you go? Whom do you call to grab hold of the government lifeline? And what if you're not in trouble, you do things right, you make your payments? Can you get a cheaper mortgage also? Let's start with the first group.

CNN's Gerri Willis joins me with some information that you can literally take to the bank.

Hey, Gerri.

GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Good to see you, Kyra. Yes, you know, a lot going on here. We're going to try to break it down. This plan gives mortgage lenders incentives to modify mortgages. And the treasury hopes to help as many as 3 million to 4 million homeowners avoid foreclosure.

Now, Kyra, here's how you qualify for a mortgage modification, a change to your existing mortgage. Your home has to be a primary residence. If you are a speculator, you're out of luck here. Your monthly mortgage payment is greater -- has to be greater than 31 percent of your monthly gross income. Your loan cannot exceed Fannie Mae and Freddie Mac loan limits, which are currently about $417,000, but that could change. We'll have to wait. Final eligibility has to be determined by your mortgage lender.

Now, we're going to get details on these eligibility requirements on March 4. That's when the program starts, so that's when you really want to listen up and hear the details.

Now, one other thing: you don't need to be behind on your mortgage payments to be eligible for a modification. If you're struggling to make your payments, if you lost your job or your interest rate was reset to an unaffordable level, you may qualify, too.

This plan also includes incentive payments for borrowers who make on-time payments on this modified loan. The incentive is valued about 1,000 bucks. It will accrue monthly, and it's going to be applied directly to your mortgage debt. You don't get a check yourself; it goes to your lender. If you pay on time for five years, you can have up to $5,000 applied to your mortgage debt.

Now, if your loan is going through foreclosure now, contact your mortgage services -- servicer or a credit counselor. A lot of mortgage lenders have said they will postpone foreclosure sales on mortgages that may qualify for this modification. So you need to get on it right now.

PHILLIPS: All right. So -- well, so the program doesn't start until March 4. So you're saying troubled homeowners need to get on it right now?

WILLIS: That's right. You need to get your information together that you're going to need to provide to your lender. And this includes -- this is a long list. Get out a pencil and paper. Your income information, including pay stubs; your most recent income tax return; information about any second mortgage on the house, if you have a second mortgage; payments on each of your credit cards, if you're carrying balances month to month; and payments on other loans. Do you have a student loan? Do you have a car loan? You need that information, too. So it's time to start bringing that all together.

And I think you get on the horn now and say, "I want to be part of this program. When you guys are starting to put this together, I want to be on that list." Because you've got to think, Kyra, at the end of the day a lot of people are going to be interested in this. They're going to want to know if they qualify. And the only way they're going to do that is by getting in touch with your lender. Go to HUD.gov for more details.

You know, I just can't tell people strongly enough, if you're worried about your mortgage, if the value of your house is down, maybe you're making your payments. You need to check it out. Make sure that -- if you are eligible for help here.

PHILLIPS: Gerri, thanks.

And stay with us, because Gerri is going to join us next hour with the prospects for homeowners who can pay what they owe but would like to owe less.

Now what do you want to know about the housing rescue plan? You can send us your e-mails at cnnnewsroom@CNN.com. And Gerri Willis will answer some of your questions next hour. She'll join us again. You can also send us your thoughts via iReport.com.

Now, America's money problems, a big headache for Federal Reserve chairman Ben Bernanke. He's speaking this hour at the National Press Club in Washington. Now under Bernanke, the Fed has cut its key interest rate to near 0 percent. And it's taken a number of other dramatic steps to try to stabilize the economy. We'll be monitoring what Bernanke has to say.

Seventeen billion dollars in taxpayers' money, and it's still not enough. General Motors and Chrysler say that they'll need more than twice that amount in government loans just to stay afloat.

Both automakers outlined their structuring plans by yesterday's deadline. And here's the bottom line: GM says it could need up to $30 billion total. That includes the $13 billion that's already received. Chrysler wants $5 billion in new loans on top of the $4 billion it got in December. That would push the combined total to $39 billion.

GM also says it needs to cut 47,000 more jobs and close five more U.S. plants. Chrysler plans to cut 3,000 more jobs and stop making three vehicle models.

(BEGIN VIDEO CLIP)

FRITZ HENDERSON, PRESIDENT, GENERAL MOTORS: We developed our plan based upon a series of extremely conservative assumptions. And so I guess I would say there are no guarantees in life that I'm aware of, certainly not -- not in our business, other than competition.

But we based our plan on a set of very conservative assumptions such that we could structure the business, not only operationally but from a capital structure perspective, to be able to demonstrate that we can repay the loans and create value. That is the best we can do.

(END VIDEO CLIP)

PHILLIPS: Treasury Secretary Timothy Geithner says that his team will meet later in the week to analyze the automakers' plans.

Well, it's been an up-and-down day on Wall Street after yesterday's losses. Checking the big board right now, Dow Industrials up almost nine points. We're going to go live to the New York Stock Exchange just a little later for the latest on what's fueling today's action.

And he's been in office for a month. How much longer is anybody's guess. Illinois Senator Roland Burris facing withering criticism over his latest admission in the Rod Blagojevich scandal.

Amid calls for his resignation and a preliminary ethics probe, Senator Burris is speaking today to the City Club of Chicago. This week he did acknowledge conversations with the ousted governor's brother about fundraising, conversations that he didn't mention under oath to Illinois lawmakers.

In an editorial today, the "Chicago Tribune" called for his resignation. Quote, "The benefit of the doubt has already been stretched thin. It finally snapped like a rubber band, popping him on that long Pinocchio nose of his."

A deteriorating situation. That's President Obama's take on the war in Afghanistan. And in response, he's ordering thousands more troops to the war zone. We'll talk with retired Army general brigadier -- Army Brigadier General, rather, Mark Kimmitt.

(COMMERCIAL BREAK)

PHILLIPS: Well, it's not as well known as the MRSA superbug, but it's a dangerous new bacteria that resists most drug treatments, and it's spreading through hospitals.

(COMMERCIAL BREAK)

PHILLIPS: Stuck in Guantanamo. Seventeen Muslim detainees from China due for release will stay there just a while longer. Federal appeals court today overturned a ruling that would have brought them to the United States. And now the government will have to figure out what to do with them. None are labeled enemy combatants, and the U.S. is reluctant to send them home to China for fear that they'll be tortured.

The war in Iraq may be winding down for U.S. troops, but just the opposite is happening in Afghanistan. President Obama is ordering thousands more troops to the war zone to, in his words, stabilize a deteriorating situation.

Here's our Pentagon correspondent, Chris Lawrence.

(BEGIN VIDEOTAPE)

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT (voice-over): President Obama has made the first combat decision of his presidency, as he signed off on sending 17,000 more American troops to Afghanistan. The first to go: roughly 8,000 Marines from Camp Lejeune will be on the ground in late spring, followed by 4,000 soldiers from an Army Stryker Brigade at Ft. Lewis. A U.S. military official says both are being trained for dual missions: fight the insurgency and mentor the Afghan Army. Five thousand more support troops will get orders at a later date.

One of their first missions: reclaim the southern part of Afghanistan, where the Taliban operates uncontested in some areas. That means securing roads against bombs and allowing commanders to hold territory long enough to put economic programs in place.

ROBERT GATES, SECRETARY OF DEFENSE: By being a permanent presence there, by being a long-term presence, rather than flying out by helicopter for a day's operations or a couple of days' operations, and then flying back to their base.

LAWRENCE: A team of Navy Seabees has already arrived to build basic infrastructure for the incoming troops. And Defense Department officials tell us more forward bases will be established soon.

The additional troops come ahead of the president's review of Afghanistan's strategy. In an interview with Canada's CBC Tuesday, the president said the situation there is deteriorating.

OBAMA: I am absolutely convinced that you cannot solve the problem of Afghanistan, the Taliban, the spread of extremism in that region solely through military means. We're going to have to use diplomacy. We're going to have to use development.

LAWRENCE (voice-over): A U.S. Military official with specific knowledge of Afghanistan deployment tells us this is not a surge. This operation is being planned as a sustained commitment over several years. You can't do a surge for that long.

Chris Lawrence, CNN, the Pentagon.

(END VIDEOTAPE)

PHILLIPS: So you heard Chris Lawrence nail the Afghanistan mission right on the head: stop the spread of extremism. Let's remember why the United States invaded Afghanistan: the 9/11 terror attacks, to get Osama bin Laden and end the Taliban's reign of terror.

Obviously, we've avoided another 9/11; however, in a new report by the Rand Corporation, a nonprofit research group, insurgent groups, drug trafficking and warlord influence have been on the rise in Afghanistan. It concludes "urgent measures are needed."

So does retired Brigadier General Mark Kimmitt agree? He was most recently the assistant secretary of state for political military affairs. He joins me live out of Washington.

General, good to see you again. And I remember when you were heavily active in that region. I mean the mission to go into Afghanistan was to take out the al Qaeda sanctuary that was there and stop the Taliban from its influence. So what happened? Why are we seeing a growth and a strengthening of both? BRIGADIER GENERAL MARK KIMMITT (RET.), U.S. ARMY: Well, it is certainly the case that over the past couple of years, the Taliban have been able to re-establish themselves in the southern section of Afghanistan, the Kandahar, Helmand, Uruzgan provinces. That's the home of the insurgency, and it may well be that they saw specific weakness in that area and have decided to try to re-establish themselves.

PHILLIPS: So did we ever -- did we have enough troops there in the first place?

KIMMITT: Well, you know, that's a question for the historians to deal with. The fact is more troops are coming in. It will add to the number of troops already there being contributed by countries such as Britain, the Netherlands, Canada, and Romania. And that should make a significant difference as Secretary Gates mentioned in his comments, as well.

PHILLIPS: Now General, weren't troops pulled out of Afghanistan to go to Iraq? I know a lot of the guys, and women, as well, told me they had to pull double duty.

KIMMITT: No, no troops were pulled out of Afghanistan and redeployed from Afghanistan. There was not a reduction of forces in Afghanistan after the Iraq conflict. However, there clearly were tensions between the two missions and the drain and commitment that put on the military forces.

PHILLIPS: I think it's important to remind our viewers exactly why this is happening and the importance of somehow getting Afghanistan back in order. And that is because of the Taliban rule and what has happened with women, what has happened with drug running, what has happened with regard to training camps there. It's still a problem years later.

KIMMITT: What it is -- and that's what the troops are going to be doing going in there. They're going to in the only fight the Taliban to ensure that the Taliban don't re-establish the control that they had pre-9/11, and also to assist the Iraqi -- correction, the Afghan national security forces so they can build up their capacities to fight the Taliban on their own, as well.

PHILLIPS: So how exactly will these extra troops reverse the success that the Taliban is having right now?

KIMMITT: Two ways. No. 1, as mentioned, just the additional troops on the ground will allow for a more focused presence and a more sustained presence of troops in areas to fight the Taliban. So it's not an issue that you will come in, fight them one day, leave and let them simply re-take the land that you've already taken.

Second, as was mentioned, the mentoring of the Afghanistan national security forces. At the end of the day, this is the fight for the Afghan national security forces to take on. There has been a need and a call by generals in Afghanistan for some period of time for additional trainers, for additional mentors, and these are some of the troops that will provide that capability, along with their NATO allies.

PHILLIPS: Finally, General, are troops still looking for bin Laden? Is that still a priority like it was in 2003?

KIMMITT: Certainly, the case that we need to bring bin Laden to justice. He is an iconic figure in the war on terrorism. His mere presence and his sustainment [SIC] over time demonstrates to the world at large that he remains a formidable figure, a rallying cry, someone for jihadists and extremists to rally around. He must be brought to justice, he must be held accountable for the crimes against the world that he has perpetuated.

PHILLIPS: But is it still a military priority to get him right now?

KIMMITT: It is certainly a military priority, if for no other reason than to protect the American homeland and protect other countries against the atrocities perpetrated by al Qaeda and its associated movements.

PHILLIPS: General Mark Kimmitt, good to see you again.

KIMMITT: Good to see you. Thank you.

PHILLIPS: Secretary of State Hillary Clinton is in Indonesia, the latest leg in her overseas tour. Today's visit is aimed at developing better relations with the world's most populous Muslim country, which was the childhood home of President Obama.

In an effort to do that, Clinton promised more development aid and to restart the Peace Corps program there. She says that she hopes that Indonesia, in turn, will work with the U.S. on climate change, trade, education and security.

It's a scene California's gotten used to this winter: snow and a lot of it. We're going to show you what the latest Pacific storm left behind, and we'll find out what's happening across the country.

(COMMERCIAL BREAK)

PHILLIPS: Pretty tough going for travelers in parts of California. This week's winter storm left up to ten feet of snow at higher elevations in the Sierra Nevada. Up to three feet fell in the mountains near Los Angeles. And across the region, there was also heavy rain, up to two inches in Malibu. Those storms also produced mud- and rock slides and snarled traffic.

While parts of the country are snowed in, thunderstorms rumbling across the southeast. Isn't that right, Chris Smith?

(WEATHER REPORT)

PHILLIPS: Depart -- all right, Chris, thanks so much.

And just as you were wrapping up your weather report there, I'm being told President Barack Obama arriving, Air Force One there to leave Arizona after giving his speech on the foreclosure crisis.

As you know, he introduced his homeowner affordability and stability plan today. These are live pictures coming to us from our affiliate, KTVK. We want to thank you for that. He's going to be heading back to Washington.

And all throughout the afternoon we're going to be talking about what his plan means to borrowers who are current on their mortgage and asking a lot of questions. Also those who are at risk of foreclosure. We are answering questions that you have, as well, on how his plan will help you.

Also, too, if you have already been -- have lost your home in a foreclosure, what his affordability and stability plan when it comes to home ownership means to you.

So we're tracking the president of the United States as he leaves Arizona, now headed back to Washington. Of course, we'll be talking more about what he calls a pretty tremendous plan to help those that are struggling with their homes this year.

Well, in Colombia in South America, floodwaters are blamed for at least six deaths, and at least 14 people are missing. The floods followed torrential rains that pounded southwestern Colombia. And in the hardest-hit town, dozens of people are now homeless. The situation there is described as very grave.

Snow in Moscow. What's the big deal about that? Well a lot of it's turning to slush this winter on the streets of the Russian capital. Warmer than normal weather is taking much of the edge off Moscow's usually brutal winter. And that's raising concerns about global warming. Experts say as the planet warms, Russia will face more forest fires, droughts and floods in the coming century.

Foreclosed and forgotten. Banks who neglect their new properties now targets for a Web watchdog.

(COMMERCIAL BREAK)

PHILLIPS: And hello, everyone. I'm Kyra Phillips live at the CNN world headquarters in Atlanta. You're live in the CNN NEWSROOM.

And pushing the news forward, the economic rescue hits home the day after President Obama signed a gargantuan economic stimulus and carmakers outlined a tortuous road map to solvency. The president has unveiled a $75 billion homeowner affordability and stability plan. It aims to break the vicious cycle of foreclosures and plummeting home values by rewriting mortgages with financial incentives from Washington.

(BEGIN VIDEO CLIP)

OBAMA: It will prevent the worst consequences of this crisis from wreaking even greater havoc on the economy. And by bringing down the foreclosure rate, it will help to shore up housing prices for everybody. According to estimates by the Treasury Department, this plan could stop the slide in home prices due to neighboring foreclosures by up to $6,000 per home.

(END VIDEO CLIP)

PHILLIPS: Not long before the president spoke the government reported housing starts and building permits both sank again last month to record lows. Now, Phoenix is a poster city for the real estate boom gone bust. Housing prices there have fallen almost 50 percent since they topped out three years ago.

In 2008, foreclosure proceedings began against 117,000 properties in Arizona. That's a 203 percent increase over 2007. Only Nevada and Florida had more. New-home sales in Phoenix plunged 60 percent from 2007 to 2008. And the city lost 35,000 construction jobs last year, 23,000 others in professional and business services as well.

(BEGIN VIDEO CLIP)

MAYOR PHIL GORDON (D), PHOENIX: This is the problem. If we don't solve the housing crisis, it won't matter about jobs, about public safety, about any of the private sectors that have been receiving the bailouts, because people need a safe place to live and raise their children and go to school, and that has not stabilized at this moment.

(END VIDEO CLIP)

PHILLIPS: Also unstable, American neighborhoods swamped by foreclosures. When banks take over homes, it's in name only. Nobody moves in and takes care of these places, except maybe vandals and rats. Frustrated neighbors have had no recourse really, until now. Here's CNN's Ted Rowlands.

(BEGIN VIDEOTAPE)

TED ROWLANDS, CNN CORRESPONDENT (voice-over): The people living next door to Mark McKinzie moved out almost two years ago. Now, weeds are actually growing out of the garage.

MARK MCKINZIE, LENDEROFFENDER.COM: I said, well, what can I do? Well, I can create something that might call attention to the problem and give frustrated residents a voice out here.

ROWLANDS: Last month, McKinzie created lenderoffender.com, a Web site where people anywhere in the country can post, for free, information about neglected foreclosed properties. For each entry, there's a photo, a few comments and the name of the lender or bank that owns the home. If the property is cleaned up, McKinzie takes it off the site. He says this house down the street has been vacant for months.

MCKINZIE: Look at the lawn. I mean, that is black, dead lawn. So, no one in this neighborhood deserves to live next to this property. And homeowners in this area deserve to know who owns this property, too.

ROWLANDS: Citibank owns this house. They told CNN it became vacant in late November and is now in escrow. As for the lawn, they said, quote, "We did not sod the lawn because it moved in the market very quickly."

One lender, Wells Fargo, actually cleaned up their properties listed on the Web site. In a statement to CNN, they said in part they are, quote, "very concerned with preserving the condition of homes and neighborhoods," and added they'll keep watching the Web site.

Delores Conway, professor at the University of Southern California specializing in real estate, says lenderoffender.com may push others to act.

PROF. DELORES CONWAY, UNIVERSITY OF SOUTHERN CALIFORNIA: It may help to nudge the lenders along a little bit in terms of coming out and putting in the proper maintenance to the property.

ROWLANDS: McKinzie's hoping she is right, especially when it comes to the house next door.

(END VIDEOTAPE)

PHILLIPS: Once again, that was our Ted Rowlands.

Now, on Wall Street stocks have been bouncing in and out of positive territory all day as investors continue to focus on the ongoing economic problems, both here in the U.S. and around the globe. Susan Lisovicz on the floor of the New York Stock Exchange with more on today's market tug-of-war. Hey, Susan.

SUSAN LISOVICZ, CNN CORRESPONDENT: Hi, Kyra. It is a tug-of- war. We are seeing a choppy day here. The good news is that the point moves are very small. But one thing for sure is that the Dow has been dipping below 7552. That is the low of the bear market, the closing low of the bear market.

And if it closes below that today, what basically happens is stocks look for the next support level. So, in other words, further to fall. What's weighing on investors' minds? Well, it's not only the state of the U.S. economy, it's Japan, the second-largest economy, facing its worst downturn in 35 years. Britain facing its sharpest decline in 20 years. Germany at its worst pace in nearly 20 years.

And it's playing out, as it frequently does, on the big board. Right now the Dow is down just three points, and below that key level I just mentioned the Nasdaq is down two points. And obviously, there's just a lot of debate as what needs to be done, Kyra. That's a lot of hand-wringing on the street here.

PHILLIPS: Well, and a lot of buzzing about some of the nation's biggest banks possibly being taken over by the government.

LISOVICZ: That's right. And we're partly there. And there's been a lot of hand-wringing about that. And it's one of the reasons why the banking sector -- banking stocks were just creamed yesterday.

An unlikely source saying that that may be the least bad option. Those are his words. To a temporary nationalization of banks. Alan Greenspan, the former chairman of the Federal Reserve, speaking to the "Financial Times" before his speech last night in New York saying that a temporary nationalization of some banks might be the best way to get the financial system back on its feet.

And to quote him directly, "I understand that once in 100 years this is what you do." His successor at the Federal Reserve, Ben Bernanke, is speaking out this moment in Washington, D.C. at the National Press Club. And he said the Fed will -- has done and will continue to do everything within its legal authority to restore financial stability and to promote economic prosperity. He also said, in an ironic footnote in his prepared comments, Kyra, that he recently learned that a family home had fallen into fork. Talk about something hitting home.

Kyra, back to you.

PHILLIPS: Susan Lisovicz, thank you so much.

Well, California's budget battle, lawmakers worked late into the night but still couldn't agree on a plan to deal with the state's $42 billion deficit. Governor Arnold Schwarzenegger pointed to the hero pilot who landed his plane in the Hudson as inspiration to lawmakers.

(BEGIN VIDEO CLIP)

GOV. ARNOLD SCHWARZENEGGER (R), CALIFORNIA: These legislators upstairs, they are negotiating and working on a budget, need a great hero in the state Capitol. They need a great hero in the state Capitol that should inspire all the legislators for them to be heroic today and to pass this budget.

(END VIDEO CLIP)

PHILLIPS: Budget talks could go back to square one after Republicans in the state Senate ousted their leader. He had agreed to tax increases. GOP legislators vow to hold the line on taxes.

(BEGIN VIDEO CLIP)

SAM AANESTAD (R), CALIFORNIA STATE SENATE: We've already had over 40 phone calls. Not one of them says, vote for new taxes. Yesterday alone we had almost 100 phone calls to my office. Only two of them urged us to vote for the budget as is. They were both state workers.

(END VIDEO CLIP)

PHILLIPS: Well, because of this budget impasse, Governor Schwarzenegger has become the process of laying off thousands of state workers.

And for about $880,000, all of this could be yours. Welcome to Albert, Texas. For sale, price reduced. The owner of this tiny town originally wanted $2 million. That would have been about $400,000 for each two-legged resident. (BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Want to make an offer? We're looking at them?

QUESTION: How many people live here?

UNIDENTIFIED FEMALE: Five. I know, the population sign says four. If you count the dog, that's six.

(END VIDEO CLIP)

PHILLIPS: All you prospective buyers can log on to alberttexas.com.

Sure, he's a New York native, but maybe the postmaster general's interested in Albert. Jack Potter might be able to afford it, actually, according to "The Washington Times." Potter got $800,000 worth of pay and perks last year. That's double President Obama's salary, by the way.

Potter's benefit package included $70,000 for security. And then there's the $135,000 in performance bonuses for his, quote, "effective leadership." With the agency losing about $3 billion a year, well, Congress plans to investigate him now.

It's a nasty bug that could rival the nastiest superbug out there, and it could be in a hospital near you.

(COMMERCIAL BREAK)

PHILLIPS: Important news on the medical front. It's a dangerous new bacteria that defies drugs and alarms doctors. And many people worry it could become the next superbug rivaling MRSA. Senior medical correspondent Elizabeth Cohen here to talk about this gram-negative bacteria. So, is it one bug or multiple bugs?

ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: It's several bugs. Several different kind of bugs that fall into the category of gram negative bacteria. Now, these bugs have been around, first identified about a decade ago but doctors say they're seeing them in hospitals more and more now.

Now, here, you can't really tell from these photos, but these bacteria are really smart. They know how to outwit some of the most sophisticated antibiotics. As a matter of fact, doctors say there is only one antibiotic that works against gram-negative bacteria, and that one doesn't even always work all the time. So, one expert termed it a possible global health threat. That's what he called these bacteria.

PHILLIPS: So, if you're in the hospital, how do you avoid getting infected?

COHEN: This is where you have to be a big-time empowered patient. And not just because of these bacteria but because of bacteria in general. It is estimated that 99,000 people die every year from infections they get in the hospital.

You have to make your doctors wash their hands. You have to check with them, hey, is my catheter clean. There are all sorts of questions you have to ask. And if you go to CNN.com/empoweredpatient, you'll see a whole list of things that you need to do so that a hospital doesn't kill you.

PHILLIPS: All right, now, the bacteria. Is it just in hospitals?

COHEN: It mostly is in hospitals, but there has been at least one report where a woman was in the hospital, contracted gram-negative bacteria, brought it home, and it seems that she gave it to her husband. So, that is the concern is that not only might this be rampant in hospitals one day, but it isn't always detected. So then, those patients go home and get other people sick.

PHILLIPS: That's one more thing to worry about when you're always going to the hospital for things you're worrying about.

COHEN: Exactly. Exactly. Infection control is a huge issue.

PHILLIPS: Elizabeth, thanks.

COHEN: Thanks.

PHILLIPS: Well, a new study shows that drug-resistant staph infections known as MRSA are more common in Illinois hospitals than originally thought. Last year, there were nearly 20,000 cases. That's an increase of 147 percent from a year earlier. Some of the increase may be due to better reporting. And health experts say only 5 percent of the patients contracted the infections during their hospital stay.

There is a bit of good news about staph infections nationwide, though. A new government report says the rate of IV or bloodstream infections in hospital ICUs has dropped.

These economic times have sparked new interest in the Great Depression that your grandparents may have lived through and renewed debate over how FDR handled it.

But first, if long hours at the office are cutting into your gym time, well, there's a new invention that could help you get a workout during your workday.

(BEGIN VIDEOTAPE)

PHILLIPS: Tired of technology that only gives your fingers a workout?

UNIDENTIFIED FEMALE: Good morning. Steelcase (ph), this is Glenda.

PHILLIPS: Check out the Walkstation, office equipment that's thinking outside the cubicle. BUD KLIPA, PRESIDENT, DETAILS: The reaction has been like nothing that I've seen in our industry in 30 years.

PHILLIPS: The $4,000 Walkstation is the brain child of Dr. James Levine of the Mayo Clinic.

DR. JAMES LEVINE, MAYO CLINIC: What we found is that people with obesity have a tendency to be seated 2 1/2 hours per day more than lean individuals.

PHILLIPS: It's a desk, a computer and a slow-moving treadmill all rolled into one, so you stay moving all day long, enough to burn about 150 calories an hour.

KLIPA: This is not intended for you to get your heart rate up and start sweating.

PHILLIPS: But once you get going, there is no slowing down.

LEVINE: Once you start working and walking, what then happens is you go back to your desk and you start doing e-mails, and you think to yourself, you know, I'd rather be walking.

PHILLIPS: Walkstation is happy with its success so far. They've sold more than 600 units. But they'll have to take revolutionizing the way we work one step at a time.

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PHILLIPS: Real-estate appraiser Julia Young telling it like it is. This iReport photo taken on the edge of Hard Times, a dead-end road in Memphis, Tennessee. She says foreclosures are dragging down home values and punishing homeowners who did pay their mortgages. Send us your photos and videos to ireport.com.

Almost everyone's grandparents had it tough during the Great Depression. Much worse, economists say now that is now. That's renewed debate about FDR's New Deal plan. Was it actually the needed fix for that era that everyone hopes the stimulus package will be for this one. Our Jim Acosta says both sides are still sparring.

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OBAMA: There you go. It's done.

JIM ACOSTA, CNN CORRESPONDENT: Even before the signing of the stimulus...

OBAMA: We have begun the essential work of keeping the American dream alive.

ACOSTA: ... Democrats and Republicans had flashbacks to a time most Americans don't remember.

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FRANKLIN D. ROOSEVELT, FORMER PRESIDENT OF THE UNITED STATES: The only thing we have to fear is fear itself.

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ACOSTA: The great debate over the Great Depression was on.

OBAMA: We have inherited an economic crisis as deep and as dire as any since the Great Depression.

ACOSTA: With the Obama administration looking to spending its way out of the current crisis, liberal and conservative economists were sparring over FDR's answer to the Great Depression, the New Deal. The question: Did it work?

DEAN BAKER, CENTER FOR ECONOMIC POLICY RESEARCH: When I say why do I think the stimulus is a good idea, I went through the Great Depression. How did we get out? We spent lots of money.

UNIDENTIFIED MALE: The New Deal was a giant failure. I think Obama should learn from a different Democratic president. He should learn from JFK, lower tax rates, don't make government bigger.

BAKER: If you could tell the different story about the New Deal, then you undermine the case for stimulus.

ACOSTA: One congressman even claimed FDR caused the Great Depression.

REP. STEVE AUSTRIA (R), OHIO: When Roosevelt did this, he put our country into a Great Depression.

ACOSTA: Congressman Steve Austria backed away from the statement, noting Roosevelt became president in 1933, four years after the Depression started.

SUZE ORMAN, PERSONAL FINANCE EXPERT: Stop telling everybody that it's dire, it's this, it's that.

ACOSTA: Now there are calls to end the debate. In short, enough with the Depression.

ORMAN: I wish everybody would stop saying it is dire, including the president.

ACOSTA: President Obama's hometown newspaper, the "Chicago Tribune," stated, "The parallels with the Great Depression are at the moment extremely far-fetched." Mr. Obama is not the first to issue dire warnings on the economy.

GEORGE W. BUSH, FORMER PRESIDENT OF THE UNITED STATES: All of us here in Washington, the president and the Congress, are responsible to confront the danger of an economic slowdown.

ACOSTA: President Bush was accused of talking down the economy in his push for tax cuts, nearly $1.5 trillion in tax cuts, larger than the Obama stimulus plan.

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PHILLIPS: So, did the New Deal end the Great Depression? It's credited with helping to great jobs. But according to historians, it was World War II that turned the economy around.

So, what would you ask the president if you had the opportunity? In keeping with his pledge to have the most open and accessible administration in American history, Mr. Obama welcomes your comments at the White House Web site, whitehouse.gov.

But you can also e-mail us, mailtothechief@cnn.com. We're going to pass your questions on to the White House, hopefully get some answers, and then we'll read them on the air.

They thought they scored a lot of loot until their getaway car got away. A break-in victim shifts gears on some dudes trying to rob his house.

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PHILLIPS: Maybe you've seen those bumper stickers, "Drive It Like You Stole It"? Well, we're going to buy one for Patrick Rosario (ph). He was home alone working in his basement when he heard noises upstairs. Well, he peeked under the cellar door and a couple of hoods were disconnecting his flat screen. So, Patrick he snuck outside to call 911. And then he saw it, the empty running getaway car.

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911 OPERATOR: 911, what are you reporting?

PATRICK ROSARIO, REPORTING ROBBERY: I'm reporting somebody's broken into my house.

911 OPERATOR: I'm sorry?

ROSARIO: Somebody's broken into my house. I just drove their car away. (LAUGHTER) They've got nothing.

911 OPERATOR: (INAUDIBLE) So you just stole their car.

ROSARIO: Yes, I know I just stole their car.

911 OPERATOR: OK, you can be charged with that, so stop.

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PHILLIPS: You've got to love it when the 911 operator laughs along with Patrick. He did stop a couple of blocks away. Back home, witnesses saw the crooks outside, arms full of stuff, faces full of shock. Well, they dropped everything and ran.

No soft landings in this hard economy. Reports out of China tell of a married businessman's ill-fated attempt at downsizing. It seems that he could no longer maintain five mistresses, so he decided to let four of them go.

But it gets better. He put on a talent show to narrow the field based on looks, singing voice and ability to hold liquor. The first woman got cut. She took it pretty badly, too. She piled everyone else and the businessman into her car and drove off a cliff. Not seen here.

Oh, yes, "Thelma and Louise," the sequel. However, in the China story, everyone survived except the woman scorned. Oh, and by the way, the businessman got dumped by all, including his wife.

What is with these Vegas casinos? First they ban Rain Man, now they won't let you count cards on your iPhone. Gaming officials in California tipped off neighboring Nevada about a blackjack program available for the iPhone and iPod Touch. While counting cards itself isn't illegal there, using a device to help you is.

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DAVID SCHWARTZ, UNIVERSITY OF NEVADA LAS VEGAS CENTER FOR GAMING RESEARCH: I think a lot of casinos are afraid, and they should be, rightfully so. There are a lot of people out there trying to cheat casinos, either at slot machines or table games. So, that's going on. I think the key is to react to it in an intelligent way that doesn't discourage casual users.

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PHILLIPS: So, if you're casually thinking about hitting the Strip with your iPhone, be aware in Nevada cheating's a felony.

The next hour of CNN NEWSROOM starts right now.