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The History of the State of the Union and What to Expect Tonight; Mortgage Brokers Being Foreclosed On; Lawmakers Keep Adding Pork; NYC Job Fair Attracts Hundreds

Aired February 24, 2009 - 14:00   ET

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

PHILLIPS: We're following two live events for you this hour. Pushing forward to President Obama's speech tonight from Washington. Oversight in hindsight. House lawmakers reviewing how bailout dollars, your dollars, were tracked from cyberspace. CNN Money team taking your questions in a "State of the Economy" special.

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

Of course, we're all over the economy story. But that's not all this hour. For some college students, spring break is all about Mexico. But one university is telling students to stay north, and stay safe.

And we'll tell you about another African-American making history more than 30 years after his death.

But first, President Obama's first address to Congress, barely a month into his first term. It's not being called a State of the Union Speech, more of a primetime economic update with more of an up-tone than we've heard before.

CNN's Ed Henry sets the stage from the White House.

Hi, Ed.

ED HENRY, CNN SR. WHITE HOUSE CORRESPONDENT: Good afternoon, Kyra.

You're right a senior White House official told me that there will be a more optimistic tone, if you will, as the president lays out what this official called a game plan to try and beat this financial crisis. The official saying, that the speech will be very light on foreign policy, which is different than what we saw from President Bush from a lot of these annual addresses to Congress and the nation. And instead, it will focus primarily on the financial crisis around four issues that fall under the umbrella that we hear the president talk a lot about.

Fiscal responsibility and stability, with the banks, the housing crisis, et cetera. Secondly, education, also, third, energy independence. And finally, health care reform as well. That that's one of those sort of long-term problems that needs to be dealt with. You can't just deal with the recession in the short term without dealing with some of these broader issues, that the president talked about yesterday at the Fiscal Responsibility Summit.

But we're told not to expect a lot of details. The president wants to really present the big picture. And that specifically he's heard the criticism that while he's had a lot of sober talk, preparing people for the possibility that this could get worse before it gets better, as Robert Gibbs said earlier on CNN, there also will be some optimism and hope about the future.

(BEGIN VIDEO CLIP)

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: We have a Recovery & Reinvestment Plan that's now the law of the land. And as you'll hear the president talk about tonight, is already working on getting tax cuts to the American people and creating jobs. The bill has already done that. You'll hear him talk tonight about financial stability, about a housing plan for responsible homeowners that have played by the rules. You'll hear him talk about re-regulating the financial industry so we don't find ourselves at this point again. You'll hear the president end tonight with a strong, hopeful message that we've met many of the challenges that have always faced this country and come out on the other side for a brighter America.

(END VIDEO CLIP)

HENRY: Now top aides say the president likes to put his own imprint on a lot of these big speeches. He's also getting help from his chief White House speechwriter, young John Favreau. He's the person who helped write the inaugural address. We're told that the latest drafts basically have it running anywhere between 50 minutes and 60 minutes depending, of course, on how much applause he gets, Kyra.

PHILLIPS: All right. We'll all be watching, Ed. Thank you so much.

HENRY: Thank you.

PHILLIPS: You can watch President Obama's address to Congress, right here on CNN, that's at 9:00 p.m. Eastern. Be sure to stay with CNN after the speech, too, for the Republican response and expert analysis on "ANDERSON COOPER 360" Then stay tuned for a special edition of "LARRY KING LIVE" at midnight.

They wait for the main event, lawmakers are tracking the TARP, and grilling the feds. TARP, better known as the bank bailout, is being overhauled by the Obama administration. Right now a House subcommittee is opening a hearing on where the money's gone so far and what it's gotten us.

Now, earlier today, a Senate panel heard something rare from Fed Chief Ben Bernanke. A glimmer, not a ray, not even a spark, but a glimmer of hope. Bernanke says the economy is withering now, but if all the remedies work, he sees a reasonable prospect that the recession could end this year. A surprisingly upbeat forecast is enough to send stocks higher. But with consumer confidence at a record low, and new job cuts announced today, the rally could be a one-hit wonder. Susan Lisovicz at the New York Stock Exchange, once again, with all the details for us.

Hey, Susan.

SUSAN LISOVICZ, CNN FINANCIAL CORRESPONDENT: Well, we're partying like it's not 1999, like it's 1997, because that's what's happening. We are bouncing off those 1997 lows that we saw yesterday, painfully enough, with the Dow, and the S&P 500.

And the Fed chief, as you just mentioned, was talking how a recession - the recession could end later this year. Well, we're still in the trenches right now. How do we know it? Not only the consumer confidence that you just mentioned, at a new all-time low, also from the housing market, the closely watched S&P Case-Schiller Home Price Index showing just another huge quarterly loss. The biggest quarterly loss since that particular index has been around.

And we're seeing job cuts from several tech companies. Spansion is cutting about a third of it's workforce, or 3,000 jobs. Chip maker Micron Technology cutting 2,000 jobs. Nokia is asking for voluntary 1,000 resignations.

But in the meantime, we're seeing some glimmers of hope with the markets. You can call it a dead cat bounce, because they say even a dead cat will bounce if dropped from high enough. We know -- we certainly know that the drops in the stock market have been steep indeed.

Right now the blue chips are up 172 points. But check out the level, 7,288. That's 2.5 percent gain today. The NASDAQ and S&P 500, up each at least 2.5 percent, Kyra.

PHILLIPS: All right. Susan, thanks.

LISOVICZ: You're welcome.

President Obama will likely pick Gary Locke as his Commerce secretary. That word now from two administration sources. Locke, a Democrat, was the nation's first Chinese-American governor when he served two terms in the Washington State. Earlier, Locke served in the Washington State House of Representatives and was chairman of the Appropriations Committee. He was born in 1950. Educated at Yale and Boston Universities; he's married and has three children.

Embattle Illinois Senator Roland Burris back in Washington. The Democrat plans to attend President Obama's address to Congress tonight. Burris is under fire over accusations that he lied about circumstances surrounding his appointment by former Illinois Governor Rod Blagojevich. And he's resisting pressure to resign, even from within his own party.

You and your Facebook friends can join in on special online coverage of the State of the Nation at CNN.com live. You can watch, listen and message. Facebook, how did we ever live without it? I remember saying that, Josh. Our senior Facebooker, about cell phones, you know? How did we ever live without those?

JOSH LEVS, CNN SPECIAL CORRESPONDENT: I know.

PHILLIPS: Now it's without Facebook ?

LEVS: When did this happen? I know. In five years from now it will be three more things we can't believe we ever lived out. Right? It's true.

I'll tell you, it's obviously working out great. We did this at the inauguration, as you know, and now we're doing it again. This is the announcement here, President Obama's address live with your Facebook friends. Let me talk you through this. Some of you might be a little intimidated. It's really easy.

If you ever watch CNN.com. LIVE, you know all you have to do is got our main page and click on CNN.com LIVE. You usually just see this, what you're seeing right now, this video box. But let's scroll to the right a little bit. Here's what is different. You don't have to click anything special. It's right there. Today, Facebook is here, if you're on Facebook, which around the world 175 million people are. You just sign in. And you have two choices, you can interact with everyone who is watching or just the people who you have designated as your Facebook friends.

If you're not part of Facebook, when you get to this page, today, it offers you the chance to be. We're not zooming way into the text, because, Kyra, this is literally live, right now. So people might be writing anything. We don't want to put ourselves in that situation. But the truth is anybody can join in. You can become a part of the discussion right away.

Now, throughout the day, as part of this, there's special programming going on from CNN.com LIVE all day long. Right now you're seeing the CNNMoney team. One thing they did earlier -I'm going to show you a piece of this now. The folks at dot.com LIVE gathered four bloggers to have a live conversation about how they feel about the Obama administration is doing so far.

Let's take a look at a little piece of that.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I, frankly, knew that all this talk about change, and how he's going to bring, you know, bipartisanship to Washington wasn't true. That's why it's so relevant. Because that was the entire premise of electing him. The very first thing he tries to do, he's not able to get a single Republican to cross the aisle. I think it is a very relevant point.

UNIDENTIFIED MALE: Wait, Beratunday (ph), do you think that the president was Annie singing "The Sun Will Come Out Tomorrow" and that it just hasn't come true?

UNIDENTIFIED MALE: No. I'm glad Matt brought this up. The reason Barack Obama was elected was not because he promised to usher in solely bipartisanship and compromise on core American values, like shared responsibility and shared wealth. The reason he was elected is the past eight years have led us into global, economic, and moral disaster.

(END VIDEO CLIP)

LEVS: So we've been having conversations like that all day long, really interesting. Lots of people out on the Internet weighing in. And weighing in on Facebook, as even that goes on. Let me show you quickly, what's coming up next. I have the schedule, right here. Next thing to know is at 3 o'clock, Suze Orman takes your financial questions. Go to dot.com LIVE right now, you have the chance to zoom in, right there. So you can join in on it.

And, Kyra, I will tell you something, if you can at any point just join in, even if you just get a few minutes, you can sign in, sign out, it keeps going all day long. Of course, we love seeing people, you know, tell us what you think about the issues. This is your chance throughout the day, Kyra.

PHILLIPS: Great. Thanks, Josh.

LEVS: OK.

PHILLIPS: Now, after you watch the president's speech on CNN, of course, at 9 o'clock Eastern, listen for anything that makes you wonder how his ideas will affect you, and your money. Then you can e- mail us your questions as soon as you can. You can fire them off to CNNnewsroom@cnn.com. We'll get Gerri Willis to answer them right after we get them and we'll toss'em to her. We'll do that tomorrow.

Now the housing bust, when will it end? Today, more bad news about home prices nationwide. We're going to tell you where they're falling the fastest.

(COMMERCIAL BREAK)

PHILLIPS: Free falling home prices show no signs of a letup. A new report today shows prices nationwide sank a record 18.2 percent in the last quarter. That's compared to the same period in 2007. The decline in the 20 biggest metro areas was even worse, 18.5 percent. The worst drops in those areas, Phoenix, down 34 percent, Vegas, down 33 percent, and San Francisco, just over 31 percent.

It isn't often a big American company says it screwed up. That's exactly what Microsoft is saying to 25 employees laid off just last month. It paid them more severance than intended and asked for it back, some $4,000 each. After one of its letters requesting the dough surfaced on the web, a red-in-the-face Microsoft realized it made a dumb move. Yesterday they told the workers they could keep the extra money.

A lot of folks all across the are scrambling to find money to send their kids to college right now. Unfortunately the recession is shattering that dream for many people. CNN's Jason Carroll spoke to one high school student who suffered a huge setback, but isn't giving up hope just yet.

(BEGIN VIDEOTAPE) JASON CARROLL, CNN CORRESPONDENT (voice over): As Mia-Sarah Abedullah sits in class, she focuses not just on the lesson of the day, she also daydreams about her future.

MIA-SARAH ABEDULLAH, HIGH SCHOOL STUDENT: I have a lot of goals. They're all pretty intense. But I'm really set on making them happen.

CARROLL: One goal of this high school junior, get into a prestigious university. Maybe even an Ivy League school. Mia says she has the grades, the drive, what her family no longer has is the money.

M. ABEDULLAH: So, I'm looking into these schools as opposed to like big name universities that I was previously, like, really obsessed with.

CARROLL: Mia's father passed away years ago and just last year her mother was laid off after working 22 years in the financial industry. She was torn on how to break the news to her daughter.

ANNA ABEDULLAH, MOTHER: I couldn't tell her, how do you tell your child you can't afford the college she wants to attend.

CARROLL (on camera): Do you remember sort of what the sort feeling was? I mean, you're not going to have the exact words, but when your mom came to you and said, we're going to have to reevaluate this?

M. ABEDULLAH: It was dream crushing kind of. She didn't want to disappoint me, but, you know, there's no way to not.

CARROLL (voice-over): A national survey showed just over half the family's polled are now considering limiting their child's college choices to less expensive schools, like public colleges. The economic downturn means fewer families can count on equity in their homes as a way to offset tuition, like they did just a few years ago.

The other problem? Many parents are unsure about their future on the job. Or like Anna Abedullah, are out of a job.

A. ABEDULLAH: It's aggravating. I mean, 22 years of working, and you figure you're going to, OK, continue working, and then - I don't know where to take it from there.

CARROLL: Mia does. She applied to a few New York state schools where tuition would be as little as a quarter of what it would cost at Columbia University. But she still hopes with a job and some financial aid, her Ivy League dream can come true.

M. ABEDULLAH: I believe that if you, like, think about it -if you dream about it enough, you'll get it. So I hope so. Fingers crossed.

CARROLL (on camera): Another point about Mia-Sarah, she was diagnosed with leukemia some time ago and fought her way through that. She and her mother say if she can fight her way through that, they can find a way to beat their financial situation. Jason Carroll, CNN, New York.

(END VIDEOTAPE)

PHILLIPS: Well, if you've got kids in college, you will want to hear this. Several schools are advising their students to skip Mexico this spring break. The warning follows a State Department alert about travel there. It says that drug-related violence has reached alarming levels, especially along the Mexico/U.S. border. There's been shootouts, actually, in broad daylight, kidnappings, you name it. In fact, the big city police chief just resigned after repeated death threats.

(WEATHER FORECAST)

PHILLIPS: When it comes to figuring out what to do in this economy, four heads are better than one, right? Gerri Willis and her handy Help Desk of money experts are about to answer questions that you might be asking yourselves. Stay with us.

(COMMERCIAL BREAK)

PHILLIPS: Play it, Duke.

Mr. Ellington getting quite an honor from his native Washington, D.C. The face of some really jazzy change in the capitol.

(COMMERCIAL BREAK)

One viewer is about to lose his job, another already has. A third is looking to cut spending. Where to turn for some advice? How about Personal Finance Editor Gerri Willis.

(BEGIN VIDEOTAPE)

GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: We want to get you answers to your financial questions. Let's get straight to the help desk. Lynnette Khalfani-Cox is a personal finance author; Ryan Mack is the president of Optimum Capital Management, and Paul LaMonica is with CNNMoney.

The first question comes from Derek in Maryland, who says, "I'm a medical records clerk who's about to become unemployed. I've been working in the medical field for 25 years. This is the only job I'm comfortable with. My wife and I each make about $40,000 a year with three kids. What should I do? I only have a high school education, with some college."

Lynnette, what do you suggest?

LYNETTE KHALFANI-COX, PERSONAL FINANCE EXPERT: The first thing is, since he knows he's about to be unemployed, take advantage of everything your employer has to offer before you go out the door. Get the best possible package you can get. Try to get them to pay for your health care benefits as long as possible. If they offer job training, resume services, anything to bolster your skills, do take advantage of all those.

WILLIS: All right. Hank from Kansas asks, "I've made my house payments on time every month, plus paying extra towards principal. I've lost my job and taken a roommate to help. Will I be able to refinance under this plan or do I need to find a low paying job quickly even though I'll make more in unemployment?"

Ryan, what do you think?

RYAN MACK, PRES., OPTIMUM CAPITAL MGMENT: Definitely they want to assist you in this process. However, if you don't have a job, you don't have any income to report. They want to make sure under this new plan that 38 percent of your -- that they're going to try to get you 38 percent assistance, and 31 percent subsidized by the government. If you don't have a job, if you don't have any income, you've got to get some employment, and get some income quickly.

WILLIS: Yes, absolutely right. One of those details that wasn't discussed very much, thanks for that.

Amy asks, "I'm trying to cut costs in our budget everywhere. One item I wanted to cut out was my gym membership. They won't let me out of my contract, though. I tried talking to a supervisor but they told me the same thing. Do you have any recommendations?

Paul?

PAUL LAMONICA, EDITOR-AT-LARGE, CNNMONEY.COM: Yes, I think from personal experience, most gym contracts tend to be one year, maybe two at most. Hopefully if you can't get out of it, it's only going to be a couple more months that you're stuck paying this. A lot of gym contracts do have penalties that you can pay to get out of the contract. It might be an upfront hit, but it will save in the long run.

WILLIS: OK. Great answer.

The help desk is all about getting you answers. Send me an e-mail to Gerri@CNN.com, or logon to cnn.com/helpdesk to see more of our financial solutions. The help desk is everywhere. Make sure to check out the latest issue of "Money" magazine on newsstands now.

(END VIDEOTAPE)

PHILLIPS: Gerri will also answer any questions you have after the president's speech tonight. You wonder how his plans might affect you? Send an e-mail to CNNNewsroom@ cnn.com. We'll get Gerri to answer them right here tomorrow. Remember the speech is tonight, 9 Eastern, you can watch it right here on CNN.

It was their job to handle mortgages. They understood the business. So how did two former brokers manage to go into foreclosure?

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: My personal feeling is that the citizens deserve a bailout. It is our money. It is our money that financed Wall Street. And they said it was to help Main Street. Well, to me, the only way to help Main Street is to give us the money. Give us all of the money. That is how you help Main Street. That is how you're going to help stimulate this economy.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

PHILLIPS: From time to time, the Constitution says the presidents shall give to the Congress information of the state of the union. That time is now. About six and a half hours away. Aides to President Obama are describing his hour-long address as a game plan of sorts for fixing the economy.

Now, most Americans apparently expect President Obama to deliver a good speech to Congress tonight. But expectations are not as high as they were for Mr. Obama's inaugural address. In a CNN/Opinion Research Corporation poll, 28 percent say they think the president will deliver an excellent speech; 44 percent say good; 19 percent say OK, 8 percent say poor or terrible.

Well, we've mentioned the president's speech will look, sound and feel like a State of the Union Address, but it's not being called that. Why not? Who says? What's the difference? Who better than NPR's political junkie Ken Rudin to enlighten us on all those questions.

Ken, good to see you.

KEN RUDIN, POLITICAL EDITOR, NATIONAL PUBLIC RADIO: Oh, I think 63 percent say it's good to see me and 27 percent say it's not good to see me.

(LAUGHTER)

PHILLIPS: We can-hey, this is all hypothesizing. Let's go ahead and do a great segment, then 100 percent will say thanks for having Ken Rudin on, Kyra.

All right. State of the Union, the last president at this point in his presidency that called it that, was Kennedy, right?

RUDIN: That's correct. He decided to call it the State of the Union, usually a first-time elected president, a president shortly after his first inauguration, does not call it a State of the Union. Kennedy did, Eisenhower did in '53. But since then, most presidents have decided to focus on issues - Jimmy Carter on energy, Reagan, Clinton on the economy - and Barack Obama is going to call it that as well, economic proposal, but not a State of the Union speech.

PHILLIPS: OK, so why do that? State of the union kind of hits all types of issues, right? Where I guess in many ways we can say, OK, this is good, he's going to stay on the one thing that we're very much worried about, and focused on at this time.

RUDIN: Right. State of the Union by definition is the kitchen sink. Everything's in it. And I expect other things other than the economy to be in tonight's speech as well. Obviously, he's going to set people up for what's going to come with healthcare changes. He may talk about withdrawing troops from Iraq, perhaps ending tax cuts for the wealthy when they expire.

But ultimately, the economy is everybody's concern. People know that the $780 billion stimulus package passed, but what is it going to help? How is it going to help? Will it help? I think Barack Obama, President Obama needs to at least give some confidence to the American people that they're on the right track.

PHILLIPS: If you look back at Kennedy and he called it a State of the Union, right? And you mentioned Reagan, Clinton, Carter, they didn't do that. Could you say that Reagan, Clinton and Carter did a better job with that type of speech, because they didn't cover all types of things, versus focusing on one?

RUDIN: Well, that's true. But also, if you're remember, both Ronald Reagan, when he was elected in 1980, and Bill Clinton when his issue was the economy stupid - I don't mean to call you stupid...

PHILLIPS: Thanks, Ken.

(LAUGHTER)

RUDIN: I shouldn't do that. But for the most part, the American people were very concerned about the economy. Jobs were being lost. When Ronald Reagan gave his speech to Congress in 1981, he talked about the worst economic climate since the Great Depression. It's kind of a language we'll hear again tonight. But people are very concerned about it. They're worried about their own job, if not members of their family's jobs. And so, to have it as an economic focus speech I think gives more people more interest in tuning in.

PHILLIPS: You know, you bring up an interesting point, because everybody remembers that speech by Clinton as "The economy, Stupid" speech. So maybe, you know, Obama needs to come up with lingo like that, so everybody remembers that speech decades down the road, right?

RUDIN: Well, everybody remembers that the economy's bad. I don't think people need a reminder.

PHILLIPS: Yes, that's a good point. That's definitely a smart point. Well, he could be like Thomas Jefferson, right, and deliver it in writing?

RUDIN: That's true. With Jefferson didn't get the ratings on CNN that later presidents did. As a matter of fact, the numbers were not as good for CNN back then.

PHILLIPS: Oh, Ken, you're brutal.

RUDIN: Monroe did well. But Jefferson wasn't...

PHILLIPS: Didn't have to worry about the media honing in for the exclusive and the cameras everywhere. Why did the State of the Union become custom - I think it was Harry Truman, right?

RUDIN: Well, the Constitution says that from time to time, a president should let Congress know what's going on in the state of the union or the affairs of the union. And Harry Truman, in 1947, is the first time it was called a State of the Union Address. So it doesn't have to be every year. It doesn't have to be - as a matter of fact, Richard Nixon didn't even speak to Congress in 1969 after he was inaugurated. He didn't speak to Congress until 1970. I think he was too much focused on trying to end the Vietnam War and things like that. But he didn't even speak to Congress.

But it doesn't have to be every year. But people expect that January, February time, this is the time to do it. Of course, with Barack Obama with high popularity, his polls are very strong approval, people really concerned, people are really following in this. I think this is exactly what people know that people are tuning in.

PHILLIPS: Final thought, Ken. I mean, just considering the economic reality that we're in right now, not a good time. When it comes to tonight, I mean, does the title really matter? It's more about the message, the facts, the tone, correct?

RUDIN: Oh, yes. It's really about semantics. And you know, I'm not anti-semantic, but it's very important - sorry, that was a bad joke. But it's very important that the tone is set from the beginning. And look, even though we're being a little cutesy here, but the times are very serious. People are really comparing it to the Great Depression. Barack Obama knows he has an audience and he knows he has to support the American people and now he has to deliver.

PHILLIPS: Ken Rudin, always keeping me and everybody else on our toes. Great to see you.

RUDIN: Thanks, dear.

PHILLIPS: All right. Well, of course, you can watch President Obama's address to Congress live here on CNN tonight at 9:00 Eastern. It will be followed by the republican response. And "ANDERSON COOPER 360" post game with the best political team on television. We'll also have a special edition of "LARRY KING LIVE" at midnight.

Now another thing for President Obama to worry about, not that he needs it, consumer confidence in the nation's economy. It's plunged to its lowest level ever. The New York-based research group, The Conference Board (ph) said consumers have grown more fearful over massive job cuts and shrinking retirement accounts. And then on top of that, the report says consumers don't think conditions will get any better over the next six months.

If anyone should be able to rescue themselves from foreclosure, it's a couple of mortgage brokers. Right? Well, but even they're falling victim to the housing collapse. Just like millions of other Americans.

Take a look at this report brought to us by Allan Chernoff.

(BEGIN VIDEOTAPE)

ALLAN CHERNOFF, CNN SR. CORRESPONDENT (voice-over): Matt Swift and Matt Wallis both worked as mortgage brokers for American Home Mortgage. So when they bought their house about three years ago for $400,000, they knew what they were doing. They took out a fixed rate mortgage from Countrywide Financial that was well within their budget.

MATT SWIFT, FORMER MORTGAGE BROKER: This is our business. I've been doing it for a very long time, 13 years.

MATT WALLIS, FORMER MORTGAGE BROKER: We both did very well for ourselves. We had money left over, even after the down payment to do what we needed to do to make the house livable.

CHERNOFF: But when the mortgage market turned south, both men were laid off. Matt Swift was able to land a new job with Countrywide but within a few months he was let go again.

SWIFT: To date, you know, had other round of layoffs and so on. It was last in first out, I guess.

CHERNOFF: Their savings dwindled and their affordable house suddenly no longer was. Soon they fell behind on their mortgage.

SWIFT: We wound up about 11 months, you know, of unemployment. So that kind of did it in for us.

CHERNOFF: Before his foreclosure notice arrived, Matt Swift filed for personal bankruptcy in an effort to hold onto his home.

SWIFT: What that did was kind of throw a monkey wrench in the process. It kind of helped. It gave us time, much-needed time to, you know, find employment.

CHERNOFF: By last autumn, both Matt had landed jobs. Matt Wallis as a retail banker, Matt Swift in health care. Now they're trying to get their mortgage adjusted to an affordable level.

WALLIS: We have proved we can pay. We need -- but you know, we need them to do something. We need them to modify the mortgage for us.

CHERNOFF: But Countrywide, now part of Bank of America, offered a mortgage modification the two say that gives them no break. They'd have to spend nearly two-thirds of their combined income meeting their monthly obligations.

SWIFT: In my best day of loan underwriting and pressure from sales, I would never have been able to approve a loan like that, but yet, they sent that to us right away to hurry up and sign it.

CHERNOFF: Countrywide says it can't comment on individual mortgage cases, but the lender tells CNN it will review the couple's financial situation again to see if it can lower their mortgage payment.

Last week, Countrywide's parent, Bank of America, unveiled a moratorium on foreclosure sales, and the chief of Bank of America Mortgage says, "We want to ensure that any borrower who has sufficient income and the desire to sustain home ownership has the ability to do so."

Allan Chernoff, CNN.

(END VIDEOTAPE)

PHILLIPS: How about this, a jazzy new addition to the bill. Duke Ellington becoming the first African-American featured on a circulating U.S. coin. He's shown at the piano, of course. On the back of the new District of Columbia quarter, formerly launched today, Washington residents got to vote on that design. They picked the D.C. native over Frederick Douglas and scientist and surveyor Benjamin Banneker.

The former Detroit mayor out of jail and with a new job all lined up, but the big question now is, can he take it?

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

ANTHONY STEELE, CNN IREPORTER: It seems to me that the average cost of foreclosure is $218,000. Even if we bought up a million of those foreclosures, one million foreclosures would be $218 billion. It's a lot less than we've already bailed out Wall Street and a whole lot less than the stimulus package is.

It seems to me that it's pretty basic. Why are we talking about bridges and things that will happen five and ten years from now? Just a question.

(END VIDEO CLIP)

PHILLIPS: Well, you'd think the world's most famous airline pilot could write his own ticket. But in a hearing this morning on Capitol Hill, U.S. Airways Captain Chesley Sullenberger sent out a call for his whole profession. The pilot who guided Flight 1549 to a perfect landing on the Hudson River sys that he and his comrades have been squeezed economically for years.

(BEGIN VIDEO CLIP)

CAPT. CHESLEY "SULLY" SULLENBERGER, US AIRWAYS PILOT: My pay has been cut 40 percent. My pension, like most airline pensions, has been terminated and replaced by a PBGC guarantee worth only pennies on the dollar. While airline pilots are by no means alone in our financial struggles, I want to acknowledge how difficult it is for everyone right now. It is important to underscore that the terms of our employment have changed dramatically from when I began my career, leading to an untenable financial situation for pilots and their families. (END VIDEO CLIP)

PHLLIPS: Sully says that he doesn't know a single professional airline pilot who wants his or her children to take up the same career.

A four-alarm fire takes a deadly toll in a New York apartment building. It happened in Chinatown. One person was killed; more than two dozen others were hurt, four of them in critical condition. Right now, fire officials don't know how that fire started.

It was a botched drug raid that turned into a nationwide outrage. Now a trio of former Atlanta cops will be spending the next few years behind bars. In 2006, the three played roles in the death of Katherine Johnson. The 92-year-old woman died in a hail of gunfire when they raided her home mistakenly thinking it was a drug den. The former officers received sentences ranging from five to ten years.

Will he be exchanging his snow chains for a Stetson? A Michigan judge is to decide whether former Detroit Mayor Kwame Kilpatrick can go to Dallas for job training. Kilpatrick has lined up a new gig at a software firm. He served more months in jail on obstruction of justice charges following a scandalous text messaging affair. Kilpatrick's now on probation and needs permission to travel. And he needs the work, he owes Detroit $1 million in restitution.

And as always, Team Sanchez back there working on the next hour of CNN NEWSROOM.

What you got going, Rick?

RICK SANCHEZ, CNN ANCHOR: We've got a couple of things going on I think you might find extremely interesting. You know, we're really queuing in on what's going on right now with the situation in Iraq. I mean, the idea that four U.S. soldiers - what's the matter? Are you there, Kyra?

PHILLIPS: I'm with you, my dear.

SANCHEZ: I'm sorry. I heard your director talking to me. And he's got a fine voice, that director.

PHILLIPS: Yes.

SANCHEZ: The idea that four U.S. soldiers could have somehow been injured in Iraq, three of them apparently shot. We're looking into that situation. Really, trying to drill down as to what happened. Especially, if there's any possibility that the altercation may have been caused by Iraqi police, for example, who were involved in somehow injuring them. Not a good sign. Not a good sign if you have a situation where you have Iraqis possibly injuring Americans. And especially if they're doing it purposely. We've got Arwa Damon standing by. She's going to be breaking that down door us.

And of course, the big speech tonight is what everybody's talking about. And the question is, do we nationalize or not nationalize. And Bernanke comes out today and says the recovery will begin in 2010. The end of these hard times we're going through will end in the - sometime around 2009. Obviously, the end of this year. Is he telling it like it is? Or is he telling us what we want to hear? How is the president going to deal with that tonight?

There's a lot of stuff going on. We'll be talking to two people today who you might find interesting, the new secretary of education, and Charles Schumer, both going to join us.

PHILLIPS: Sounds good. Thanks, Rick.

New York, if you can make it there, you can make it anywhere, right? Well, check out all the New Yorkers trying to make it. A job fair with lines so long, you'd think it was Studio 54 in 1979.

(COMMERCIAL BREAK)

PHILLIPS: Well, pork may be a four-letter word on Capitol Hill, at least in public. But just because the president wanted a pork-free stimulus doesn't mean lawmakers' pet projects - also known as earmarks, by the way - are things of the past. Our Drew Griffin found proof with just a few clicks of his mouse and he was just telling me how many.

And is anybody listening? Echo, echo.

DREW GRIFFIN, CNN CORRESPONDENT: You know, I've been on this trail with a lot of other people for two years now we've been chasing this pork.

PHILLIPS: You're a pork reporter.

GRIFFIN: I'm a porker. And, you know, yesterday the president is talking about fiscal restraint. At the same time that Congress dumps electronically this bill, this pork bill, onto their website listing 8,570 pieces of pork. So instead of me running around the country...

PHILLIPS: Chasing 8,500...

GRIFFIN: I'm going to teach you, Kyra, and everybody else how to look your own pork.

PHILLIPS: OK, let's do it.

GRIFFIN: Step number one, House Appropriations Committee. Go to that website there. There's David Obey from Wisconsin, he's the chairman of it. This is the omnibus spending bill. Basically, all the pork from last year that they didn't want to talk about during the election is dumped into this year. So you go to this little piece called the bill tech the explanatory. I've got a cheat sheet here. Oh, boy. Nope, I'm ahead of myself there.

I open that up and you'll see the divisions. Each division is a different part of the budget. Agriculture, Commerce, Energy, see all that? PHILLIPS: Got it.

GRIFFIN: All right? Now, underneath those are the statements. That is the pork mother lode. That is where senators and Congress have to state what they want.

PHILLIPS: Can you give me an example?

GRIFFIN: First I'm going to tell you - Akutan Airport. Let's roll the video. This thing is way out in the middle of nowhere...

PHILLIPS: You went there, didn't you?

GRIFFIN: ... in Alaska.

(CROSSTALK)

GRIFFIN: Basically this - Ted Stevens, disgraced and no longer a senator, wanted to get an airport here at Akutan. Why? Because one of his supporters, Trident Seafoods, has a seasonal plant there. They wanted to fly workers there instead of boating them there. So he asked for money last year for an airport. Stevens, as you know, is gone.

PHILLIPS: He got ousted.

GRIFFIN: But Lisa Murkowsi, the now senior Alaskan senator, apparently still thinks that's a good idea. So we open up the Transportation Bill, and there you can see right here, Senator Murkowski is asking for $1.187 million for an airport in Akutan, Alaska.

PHILLIPS: You would think, too, after Stevens got the boot and Sarah Palin came forward and talked about the big boy corruption and getting rid of wasteful spending and all of that, that this - now this senator is coming in and wanting to do the exact same thing?

GRIFFIN: Exactly. I mean, it is crazy. There's two guys from Georgia, two Georgia republicans, right? They're both critical of all the pork in this bill. Those same two guys are asking for $346,000 for cotton insect management. David Obey, he wants $950,000 for a Great Lakes maritime research project. He also wants to restore old lighthouses. There's an Alabama Congressman who wants $47,000 to put a fence around an airport. That airport has 14 planes.

PHILLIPS: All right. Let's not forget the economic times that we're in, political leaders. And just re-evaluate what you're asking money for.

GRIFFIN: There's going to be a lot of analysis of this bill. But in the meantime, if you wanted to search what your person is asking for, we actually blogged about this and have a how-to on our SIU blog, and it'll show you step by step how to search this crazy bit of information. It is hard to navigate, but it's better than it was. Remember, it was a stack of papers about this high.

PHILLIPS: Right.

GRIFFIN: Which you had to dig through and there was no names attached. So it is getting better.

PHILLIPS: Meanwhile, you won't chase the 8,000-plus difference.

GRIFFIN: I'm still waiting for what they want me to chase. I'm sick of it.

PHILLIPS: Thank you, Drew. OK, thank you. Appreciate it.

Well, you think you're in a tight spot right now? Check out the two people who found themselves between a tree and a raging, swirling, potentially fatal place.

(COMMERCIAL BREAK)

PHILLIPS: Well, judging from the line of New Yorkers waiting to get in, you might think the best Broadway show ever was giving away tickets. But today in this recession, the toast of the town is a job fair.

Deb Feyerick is there. Yes, she's still there.

Deb, we understand the fair was so crowded, they even extended the time?

DEBORAH FEYERICK, CNN CORRESPONDENT: They did extend the time. Most people now inside. But a couple of these people waited for five hours just to get in the doors. And we can tell you, we've never seen a line like this. If you can imagine, it stretched the length of this entire city block, rounded the corner, stretched the length of that block, then doubled around and came back in. And that's what people were waiting on. These were people of all ages, all backgrounds, all levels of experiences. A couple of people told us that they were here because the money is running out. They've got to find anything. They'll take anything. And it was really interesting to see that these people were willing to wait in very cold weather, simply to get an opportunity to talk to companies who might be offering jobs.

Now two of the women who were inside, Paige and Anthe, this was your first job fair. First of all, what is your industry and how long have you been laid off?

PAIGE ODABASHIAN, UNEMPLOYED: Marketing and PR, and I've been unemployed now for one month.

FEYERICK: And you, Anthe.

ANTHE ZEIMANN, UNEMPLOYED: Financial services, and I've been unemployed for about seven months.

FEYERICK: Now, you were able to find a job pretty quickly, but then you were laid off again. What does that suggest to you?

ODABASHIAN: I think it's a hard economy right now. And I think it's hard for companies to retain good talent.

FEYERICK: When you saw the line outside, what was your impression about that?

ZEIMANN: Well, as I said before, we anticipated it was going to be a huge line. So we came in pretty early this morning, around 7:00. I got up at 4:00 just to be here early because I anticipated it was going to be a line. But then we came out - when we came out around 10:30, the lines were going around the block and back. It was incredible. Incredible.

FEYERICK: Seeing all those people, knowing that all those people are out of work like you, looking for jobs, what does it mean?

ODABASHIAN: Well, it's daunting to wonder how long this will go on for all of us. To find new positions. But I also know that I'm not in the boat all by myself.

ZEIMANN: It's not unique to us, because there's so many people in the same position.

FEYERICK: The people who are offering jobs, did they give you some sort of feeling that, yes, in fact those jobs were available?

ZEIMANN: Yes. Some of them did. Quite a few of them did. They suggested we apply online. Which is what we're going to do.

FEYERICK: And an Interesting thing. Anthe is starting her own company, and Paige may be helping her out on that venture. So again, they did get a lot of ideas here. But Kyra, a lot of folks just saying, that, in fact, you know, the money's running out, they really have to find something to do. Very serious situation, given this is just the New York City area - Kyra.

PHILLIPS: Yes, really makes us all reevaluate, you know, how lucky we are to have a job, Deb. Especially when it's as competitive as it is.

FEYERICK: Absolutely.

PHILLIPS: All right, we'll follow their progress, no doubt. Deb Feyerick, really appreciate it.

And here's one place in Arizona that you don't want to be - trapped in a raging river that's just dying to sweep you off your feet. Some well-placed trees kept two people from the currents pull just long enough for rescuers to get to them. Officials said that the two had been riding an ATV before they got swept up.

Speaking of being swept up, Rick Sanchez takes it from here.