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Schools Face Budget Cuts; Missing NFL Players; Big Storm in the Northeast
Aired March 01, 2009 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RANDI KAYE, CNN ANCHOR: Folks in the east will be hearing that sound all night. Driving is dangerous enough, thinking of flying somewhere? Forget about it.
Have you seen these two pro football players? They're missing at sea. A massive search is on.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: One school citing budgetary constraints, asked students to bring light bulbs, trash bags, paper towels, even toilet paper.
(END VIDEO CLIP)
KAYE: You can forget about the three Rs, some schools can't even afford the T.P. Desperate times for public education. A story you and your kids need to see tonight.
The news starts now.
Hello. I'm Randi Kaye at CNN world headquarters in Atlanta. Don Lemon is off.
For much of the east coast, it could be winter's last blast, and it's turning into a major snowmaker up and down the eastern seaboard with the worst yet to come for a whole lot of folks. From Alabama through the Carolinas and up the coast, snow is falling, roads are icing, and flights are canceled by the hundreds.
Monday morning could be a huge mess for commuters all the way through New England. Washington could see 10 inches of snow by tomorrow night. More than a foot could fall in New York. And Boston could get as much as 15 inches.
And our Jacqui Jeras has been outside, playing with some snowballs outside, enjoying the weather a little bit.
But you're now back inside in the warmth.
JACQUI JERAS, CNN METEOROLOGIST: Yes, I am. It changed over to a little bit of rain, Randi. That's not quite as fun to be in the snow now, is it?
We've had a little bit of a mix across the Atlanta area, still getting snow though, especially on the east and the southeast side. We're watching this whole system finally starting to pull out of the area. So, we've got a couple more hours to go, but the damage, of course, has already been done. Snow on the ground along with very slushy conditions are all across parts of the Deep South.
Germantown, Tennessee, that's a suburb of Memphis, more than five inches. We had three inches in Columbus, Mississippi. Atlanta, at Hartsfield, had about two inches. Some spotty reports of more than five inches across the ATL; and Huntsville, Alabama, about an inch so far. And now, the problem is that, even though the snow is pulling out, the temperatures are plummeting.
So, when we're talking about, you know, well below freezing, in the teens and into the 20s, all of that wet and all of that slush is going to ice up. Bridges and overpasses are going to go first, and we think it's going to be a real dicey commute tomorrow morning in places like Atlanta, also into Columbia and over into even Birmingham.
Delays at the airport -- abundant, more than 300 flights have been canceled out of Atlanta Hartsfield-Jackson International. A ground stop is in effect there. Now, the northeast, you're not really into the storm system just yet other than the cloud cover. That's enough to cause delays, over an hour at Boston Logan, and Newark also is dealing with delays.
Here is where the snow is now outside of the Deep South. We're getting up the spine of the Appalachians here, and it's starting to make this moisture now into parts of the D.C. area, probably a little bit of a wintry mix here before you change over to some snowfall. We think you'll see heavier amounts east of the I-95 corridor, but a good four to seven-plus expected in D.C. Winter storm warnings now have been posted all the way up the eastern seaboard, and the entire megalopolis is really going to get a big wallop, so to speak, with this one.
This is one computer model forecast showing you the accumulated snowfall in the next 48 hours. This really won't get going in the northeast until after midnight tonight, continuing throughout much of the day. New York City, you're on the fine line of getting the heavier snow. I think it's -- possibly you could get or possible that you could get four to seven, but equally it's possible that you could get six to 12-plus. Long Island, especially, is getting hit hard as well as Hartford and Boston. Somebody in this area is going to get 15-plus inches of snow -- Randi?
KAYE: Fifteen-plus. All right, Jacqui. Thank you.
JERAS: Sure.
KAYE: A developing story off the west coast of Florida where the weather isn't helping in the search for a missing fishing party of four. CNN is now confirming at least two of the missing are pro football players identified as free agent defensive end Corey Smith who last year played for the Detroit Lions and Oakland Raiders linebacker Marquis Cooper. The Coast Guard is searching a 750 square mile area west of Clearwater Pass, Florida, that's where the four men were believed to have gone fishing. The Coast Guard is asking anyone with any information on the fishermen's whereabouts to call this number on your screen. That is 727-824-7506.
Well, it's a new week and a new month of trading tomorrow on Wall Street. Friday put the wraps on what in percentage terms was one of the worst Februarys for blue chips since the Great Depression. The Dow now stands at its lowest level in 12 years. The S&P 500 at its lowest level since 1996. Now, investors are looking for any signs of hope.
Poppy Harlow from CNNMoney.com joins me now from New York.
Poppy, those are some pretty grim numbers to absorb.
POPPY HARLOW, CNNMONEY.COM: Yes, Friday was just a dismal way to end a dismal week. The Dow closed just above 7,000. We could easily break that this week. There's a lot of important news coming up.
One of the big things that we heard on Friday was the revised reading on the fourth quarter GDP. The economy, what we know from those numbers, contracted at 6.2 percent in that three-month period alone. The worst reading we've seen, Randi, since 1982. Far worse than even economists were expecting.
And we also, of course, got news of an even greater stake, that the government is taking in Citigroup. Investors didn't like that at all. Shares of Citigroup fell 39 percent on Friday. Investors are nervous now more than ever that we are going to see a nationalization of what is one of the biggest banks, not only in the United States, but in the world.
The government is now in this new deal. There's no new money being put into Citi, but of that $45 billion of taxpayer money that's already in there, the government on Friday turned a lot of that into common stock, and it now owns about 36 percent of the bank's common stock. And that just dilutes what shareholders already have.
So, it comes down to a lack of confidence, Randi.
KAYE: Obviously, we are seeing that lack of confidence at play here.
HARLOW: Yes.
KAYE: What might be coming up this week that could really take a toll on the market?
HARLOW: Well, you know, investors around the world really early tomorrow morning, about 6:00 o'clock Eastern Time, they are waiting to hear from AIG, American International Group, the insurance giant reporting its earnings ahead of schedule tomorrow morning.
This is what's expected: A decline of 71 percent or $60 billion in the quarter. The stock, folks, it's closed at 42 cents a share on Friday, if you can believe it or not. It is already 80 percent owned by the government. And some news just coming in really in the last five minutes, Randi, according to "Reuters," AIG's board today just now approved another government bailout of the bank. This is all of the insurance giant which a lot of it is a financial services company. What we are hearing from "Reuters" is that the new deal will ease the terms on the existing about $150 billion it has put into AIG, and what we're hearing is that it will put additional equity, about $30 billion into AIG, Randi.
KAYE: Wow. All right. Poppy Harlow for us from New York -- thanks, Poppy.
HARLOW: You're welcome.
KAYE: President Obama's plan to revive the economy remains a partisan dividing line in Washington. The White House budget unveiled this week projects a $1.75 trillion deficit for the next fiscal year. Republicans say that number is dangerously high.
(BEGIN VIDEO CLIP)
REP. TOM PRICE, (R) GEORGIA: I believe deficits are not acceptable in the level to which this president has put them on the table. The budget that he put out there is going to have the largest debt in the history of the nation over the 10-year period of time. There's more debt in this budget than there has been in this nation from 1789 until today. That's not the kind of change that the American people are interested in. To have the next 10 years have deficits that are higher than any deficit ever in the history is just not acceptable.
(END VIDEO CLIP)
KAYE: Mr. Obama's advisers, of course, defend the president's budget, and they say those deficits will go down over time.
(BEGIN VIDEO CLIP, CBS, "FACE THE NATION")
RAHM EMANUEL, WHITE HOUSE CHIEF OF STAFF: First, this is a $1.7 trillion deficit he inherited. Let's be clear about that. We inherited this deficit, and we inherited $4 trillion of new debt. That is the facts.
Second, this budget is very honest with the American people. It's honest about the cost of the war, which we have never been honest for seven years. It's honest about the alternative minimum tax, which we've never been honest with the American people about. And that in this deficit reflects what we inherited at this point.
(END VIDEO CLIP)
KAYE: President Obama realizes he faces a huge fight over his massive budget. In his regular weekend address, he said, quote, "They're gearing up for a fight and so am I."
Well, is there any good economic news out there? Some of you are telling our Josh Levs why, yes, there is. Plus, the nation's schools are desperate. Your kids watching college dreams evaporate. The president promises change, but will it work?
And what's on your mind tonight? Tell us. We are watching Don Lemon's Twitter, Facebook, and MySpace pages. You can also send us photos or video on iReport.com. Be sure to join our conversation.
(COMMERCIAL BREAK)
KAYE: In the first 100 days of Barack Obama's presidency, already he's tackled the economy, and is now in the infancy stages of his education reform, and then, there's the issue of international relations.
Here is CNN's Elaine Quijano.
(BEGIN VIDEOTAPE)
ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT (voice-over): Even as President Obama focuses on the domestic economic crisis, his international challenges are equally daunting. On CNN's "STATE OF THE UNION WITH JOHN KING," the chairman of the joint chiefs said he thinks Iran might have the materials to make a nuclear bomb.
MIKE MULLEN, CHAIRMAN OF THE JOINT CHIEF OF STAFF: We think they do, quite frankly, and Iran having a nuclear weapon, I believe, for a long time is a very, very bad outcome for the region and for the world.
QUIJANO: But administration officials say, even if Iran has the materials, developing actual weapons is another matter.
ROBERT GATES, U.S. DEFENSE SECRETARY: They're not close to a stockpile. They're not close to a weapon at this point. And so, there is some time.
QUIJANO: Giving the administration some time to figure out a balance between engagement and sanctions.
Chairman Mullen also gave a bleak assessment of the situation in Afghanistan, where President Obama has pledged to send an additional 17,000 U.S. troops. Mullen said he agrees with Senator John McCain that the U.S. is losing that war.
MULLEN: I said last September in my testimony in Congress that I didn't think we were winning, although I thought we could. And I would also agree that if we're not winning in a counter insurgency, we are losing.
QUIJANO: On Iraq, President Obama's newly announced decision ...
PRES. BARACK OBAMA, UNITED STATES: By August 31st, 2010, our combat mission in Iraq will end.
QUIJANO: ... isn't sitting well with some of his fellow Democrats.
REP. NEIL ABERCROMBIE, (D) HAWAII: I think it can be done faster. It depends on what our -- what our strategic idea is there.
QUIJANO: Under the president's plan, the remaining U.S. forces would have a much different mission.
GATES: Our soldiers will be consolidated into a limited number of bases in order to provide protection for themselves and for civilians who are out working in the Iraqi neighborhoods and countryside as well.
QUIJANO: But Democratic Congressman Neil Abercrombie says too many troops, up to 50,000, would still be in harm's way.
ABERCROMBIE: No, I'm not comfortable with that number and I don't think it can be done. I think there's a reluctance on the part of some of the senior military to admit that there is solution or resolution in Iraq. Any residual troop there by definition is combat troops because the combat isn't ending.
QUIJANO (on camera): The president's defense secretary did acknowledge top commanders had wanted the combat mission in Iraq to last until the end of next year. But, he said, after an analysis of the risks, including the needs in Afghanistan, the president decided against that.
Elaine Quijano, CNN, the White House.
(END VIDEOTAPE)
KAYE: In Iraq, civilian deaths have risen sharply. The interior ministry says at least 211 civilians were killed in February. That's up from 138 in January. A low since the U.S. invasion. The deadliest single incident last month was a suicide attack carried out by a female bomber. Sixteen U.S. troops were killed last month, the same as in January.
Secretary of State Hillary Clinton has kicked off a week-long tour of the Middle East. Her plane landed in the Egyptian Red Sea resort of Sharm el-Sheikh today. Tomorrow, Clinton plans to attend an international donors conference on rebuilding battle-scarred Gaza. She plans to announce a pledge of up to $900 million, but the U.S. won't let the money flow through Hamas, Gaza's militant rulers. Clinton also plans to hold talks with Palestinian and Israeli leaders in the West Bank.
A sign of the times: Everything is on the auction block these days, and once prized possessions are going, going -- gone.
(COMMERCIAL BREAK)
(BEGIN VIDEOTAPE)
GARY TUCHMAN, CNN CORRESPONDENT (voice-over): Shape-shifting material that can transform itself in real time, changing colors and shape on demand. It sounds like special effects you would see in a sci-fi movie, but this is no illusion. Researchers at Intel teamed up with the academic community to make what they call "programmable matter." ANDREW A. CHIEN, PH.D, V.P. AND DIRECTOR OF RESEARCH, INTEL: The basic idea is the notion that you could have a material that could change its shape or change its physical properties just by reconfiguring itself.
TUCHMAN: Forget about designing something in flat two-dimensions. What about creating a 3D prototype of anything -- even a car?
CHIEN: Open the doors, kick the tires, you know, peek inside to see what it looks like. Fit little dolls of, you know, people inside of it.
TUCHMAN: The space age stuff is like putty in your hands. Programmable matter is still in the early developmental stages, but Intel's Andrew Chien says, one day, we may be able to morph objects on demand to fit our human needs.
CHIEN: So, for example, you know, I have a Bluetooth earpiece and it fits me great. But then, when I put on my sunglasses, it doesn't fit anymore. Wouldn't it be nice if it could change its shape suddenly like of all a sudden could match that? All of these things are possibly with programmable matter. We are definitely on the edge of discovery with this one.
TUCHMAN: Gary Tuchman, CNN, Atlanta.
(END VIDEOTAPE)
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP, IREPORT)
ABRAHAM ZENNIE, IREPORTER (singing): Goodbye gold card my old friend, we've seen good deeds on the high end, people tell me AmEx has crashed, people say their credit has smashed. But I'll tell you that's not going to happen to me. I'll set you free. And use my cash. (LAUGHTER).
Well, OK, and my PayPal card, too, and my gift cards. A credit card application? Forget it.
(END VIDEO CLIP)
KAYE: I-reporter Abraham Zennie singing the credit card blues. And you know what? He is not alone. Grim economic realities have forced many people to liquidate their possessions.
The quickest way to get cash? Public auction. CNN photojournalist John Bena (ph) recently visited an auction house in suburban Washington. It's busier than ever these days.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: We're setting up for a weekly auction.
Hi there, how are you? Six-one-nine-six, thank you. MATT QUINN, QUINN'S AUCTION GALLERIES: We do about 400 items -- antiques, collectibles, fine arts.
UNIDENTIFIED FEMALE: And I love this.
QUINN: Just sort of ordinary stuff -- glassware, china, paintings, water colors.
UNIDENTIFIED MALE: Lot number 16 is a hand-painted desk (ph) style ceramic oriental (ph) vase.
QUINN: Just about anything you'd find in grandma's house.
UNIDENTIFIED MALE: $20 and $25 (ph).
QUINN: Pulled out of the closet and turn into some cash.
UNIDENTIFIED MALE: $20 bid here, $25, $30, and $35.
QUINN: Average lot price is probably $35 to $55.
UNIDENTIFIED MALE: $30 there, $35 and $40.
QUINN: And we just move right through it and do it again next week.
UNIDENTIFIED MALE: Sold $45, buyer number 7168.
QUINN: Recently, a client of ours, Chuck Burch, came to us and have actually lost his job.
UNIDENTIFIED MALE: Most of these would be sold in groups.
QUINN: Was taking the time to help mom clean out her house.
CHUCK BURCH, AUCTION HOUSE CLIENT: You know, we had Matt over and had him look at, you know, look at what there was. There's some artwork, there's a lot of coins, some old books. It was a good time to just go ahead and shoot them out the door and see what we can get for him.
QUINN: He gave us a coin collection that will probably sell in excess of $10,000.
BURCH: Buy me a few more weeks and it's not going to get me through a month. It's just sort of getting through month to month at this point.
This is the first time I've ever been out of work. What we're living on is an accumulation of savings and stock purchases and that sort of thing. So, it's -- you know, it hurts. I mean, I went and picked up a check at the stockbrokers today, you know, to get through this half of the month.
QUINN: Nine ounces of gold sitting on the sheet.
BURCH: My job 24/7 now is trying to find a job because I'm putting all of my selling skills toward selling me. I've gotten much more pragmatic about my expectations from here on, and I just want -- I just want to work.
UNIDENTIFIED MALE: Lot number 35A. There is a lovely little watercolor right there. $60 bid here now, $65, $70 and $75, $80 here and $85, $90 and $95, $100, $110. Sold $110. Buyer number 4684.
BURCH: I was hoping for a lot more, but, you know, realistically, that sounds about right.
I'm just sort of an insane optimist. You know, in spite of everything, I'll work again, and it will be soon.
UNIDENTIFIED MALE: I appreciate it.
UNIDENTIFIED MALE: Have a good one. Take care.
(END VIDEOTAPE)
KAYE: Did you know that baseball, cake, and cheap furniture can help ward off the recession blues? Who knew? That's what some of you have been telling us.
Josh Levs is joining me now to explain.
And, Josh, I guess we could use a little good news.
JOSH LEVS, CNN CORRESPONDENT: Yes, we need a little bit of that, right? I want to tell everybody about this project, because it's been going on -- we started it last weekend on my Facebook page, Josh Levs CNN, and then here's (INAUDIBLE), we're inviting you to tell us some great things going on in the world, good stories, but not in a cheesy way.
I don't want people to think we made it like that. Not like kids are still frolicking and we can all drink Coke on a mountaintop. We're trying to -- give us a reality check. We're seeing a lot of rough economic news. What are some of the awesome things going on? You can weigh in right here at Facebook.
But I'll tell you something. I got some graphics that are some of our favorite quotes. Let's go straight to them.
I really like this one from John. A lot of people are saying the similar things. He says, "You know what, the vast majority of Americans are not in foreclosure and do have jobs." Next one comes from Keith: "Prices for gas, furniture, travel, clothing, cars, and homes are all down. Let's be honest -- home prices were artificially inflated and needed to come down."
And a really nice image from Julie, who reads, "Despite yet another power outage, we had a standing-room only meeting at church in the only large room with daylight. There was a spirit of kindness and cooperation and fellowship that is not commonly experienced. To some extent, this time of trouble is bringing out the best in people."
See, Randi, this is nice stuff. And then Kathey gave us this. She says, "Spring training has started. Baseball season is not too far away now."
The one reason we're doing it at Facebook is that you can get involved in a discussion. You can see people weighing in on what each other are writing. Take look at this, for example, this is interesting. Becky wrote, "The U.S. has approved the first clinical trial of stem cell treatment for spinal cord injury -- as a quad, this is great news." And then people responding with their views of stem cells and what they think about that idea.
Take a look here, too. I want to show you. Not everyone is taking it quite so seriously. This is a nice one. James, "This is a great time for a fresh start in life by going back to school full time." But I'm going to end with these more light-hearted ones, Randi, because I guess Devin didn't have too much. "My grandma made me a cake. She put extra frosting on it, too."
And Nate said, "I can't think of anything, but I did save a ton of money on my car insurance by switching to Geico." I think that's slightly clever.
All right. So, if you want to weigh in, keep it coming right here -- Josh Levs CNN. We're going to keep an eye on this. We love hearing what your good stories are and, Randi, we'll continue to bring them to you right here, because, as you know, it's always happy to have that little dose of positive reality.
KAYE: Absolutely. With we need a lot more of that.
LEVS: Just a little bit.
KAYE: All right. Thanks, Josh.
LEVS: Thanks, Randi.
KAYE: A firsthand economics lesson.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: The condition of the American public education is entering a desperate state.
(END VIDEO CLIP)
KAYE: Funding disappears, and schools crumble. Stimulus money is on the way, but is it enough? I'll show you just how bad it is.
(COMMERCIAL BREAK)
KAYE: Welcome back.
During this next half hour, we're focusing on education and your kids. I took a trip inside one of our nation's schools where desperate times call for students to bring more than their books to class. And while the president is emphasizing higher education, it looks like families now more than ever, are struggling to afford it. And many historically black colleges and universities are struggling under the weight of this economy, too.
We'll take a closer look, but first, listen to what the president has to say.
(BEGIN VIDEO CLIP, WHITEHOUSE.GOV)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I promised an education system that will prepare every American to compete, so Americans can win in a global economy. This budget will help us meet that goal with new incentives for teacher performance and pathways for advancement, new tax credits that will make college more affordable for all who want to go, and new support to ensure that those who do go finish their degree.
(END VIDEOTAPE)
RANDI KAYE, CNN NEWS ANCHOR: Promises from the president. His stimulus package pumps billions into education. I found out just how desperately schools around the nation immediate that cash.
(BEGIN VIDEOTAPE)
(on camera): It used to be kids just brought their lunch to school, but school districts around the country are in such dire straits that in Detroit one school, citing budget tear constraints, asked students to bring light bulbs, trash bags, paper towels, even toilet paper. This in the same city where automakers got billions in bailout money.
UNIDENTIFIED MALE: Seems like the school should have it, you know. And, you know, we try to do the best to comply with what they ask for.
KAYE: The slumping economy has robbed states of precious tax dollars that helped fund education. Help is on the way. It's not clear yet when, but the stimulus package should pump about $100 billion into public education. That is more than double the annual funding under the Bush administration.
Before the stimulus passed, President Obama made one last pitch.
OBAMA: I visited a school down in South Carolina that was built in the 1850s. It's right next to a railroad. and when the train runs by, the whole building shakes and the teacher has to stop teaching for a while. The auditorium is completely broken down. They can't use it.
KAYE: In Miami, the school budget was cut $300 million. Some students learn in trailers on the playground.
ALBERTO CARVAHLO, MIAMI-DADE SCHOOL SUPERINTENDENT: The condition of American public education centering a desperate state.
KAYE: Outside Cleveland, Ohio, one superintendent wrote then Treasury Secretary Henry Paulson to ask for $100 million. Todd Hoadley never heard from Paulson but was told his district doesn't qualify because it is not a financial sector business. Hoadley's already cut $2.3 million from his budget. 1,200 students are crammed into a building made for 800. So tight maintenance closets are used as classrooms.
HOADLEY, OLMSTEAD FALLS, OHIO SCHOOL SUPERINTENDENT: We use the stage in the gymnasium for an art class with physical education right on the other side of the curtain, both going on simultaneously.
KAYE: At this school in Yonkers, New York, concrete is falling off the building.
This building needs to be replaced, definitely.
KAYE: The building is sagging. Windows don't even close.
(on camera): When this Yonkers school couldn't get the money to repair its roof, officials put up scaffolding and plastic to protect students. It was all they could afford to make sure the roof didn't collapse. The superintendent just doesn't have the money for a new one.
(voice-over): That may change once stimulus funds arrive. It's allocated based on how many school-aged children states have.
But it comes with restrictions. Funds cannot be used to build new athletic fields or on anything that isn't directly related to academics.
Restrictions or not, California will take it. Maybe then, this San Diego calculus teacher won't have to sell ad space on his exams to cover the cost of printing them, like he did last fall.
TOM FARBER, CALCULUS TEACHER: I would never have done this five years ago or ten years ago. I wouldn't have even thought of it because there was never a necessity.
KAYE: These are desperate times.
(END VIDEOTAPE)
KAYE: They sure are. We want to share with you some of your responses. Thanks for Twittering with us.
This one from AustinJallen, "I can barely afford school. My state, California, took so long to reach a budget I think I may drop out and run for state office."
CodyJones has an opinion as well, "Well, even though the Dow is plunging with the stimulus bill, I think the Dow will recover just fine."
BarBrad writes, "Can you afford not to be in school? No jobs. Feds give money for school."
Heathfox says this, "People can't even afford to stay in their homes. School? That's a wishful thought in this economy."
Those are just some of the many opinions. And we want you to be part of show, part of our conversation. Log on to Twitter, Facebook, MySpace or iReport.com and tell us what you are thinking.
Dreaming of a degree but struggling to pay for it? When making the grade is not nearly enough. Got an aspiring college student on your hands? Well, you will want them to watch.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
OBAMA: Tonight, I ask every American to commit to at least one year or more of higher education or career training. It's going to be a community college or a four-year school, vocational training or an apprenticeship, but whatever the training may be, every American will need to get more than a high school diploma.
(END VIDEO CLIP)
KAYE: That was President Obama on higher education.
But is a higher education still a possibility for some? The economy's trickle-down effect is making some high schoolers worry about where they'll end up after graduation.
Here's CNN's Jason Carroll.
(BEGIN VIDEOTAPE)
JASON CARROLL, CNN NEWS CORRESPONDENT (voice-over): As Mia Sara Abedullah sits in class, she focuses not only about the lesson of the day, but about her future.
Mia SARA ABEDULLAH, STUDENT: I have a lot of goals and they're all pretty intense. 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.
ABEDULLAH: So I'm looking into state schools opposed to big-name university that I was previously looking at.
CARROLL: Her father passed away years ago. 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 OF MIA: I couldn't tell -- how do you tell your child you can't, you know, afford the college that she wants to attend?
CARROLL (on camera): Do you remember sort of what the feeling was? You're not going to have the exact words, when your mom came to you and said we have to e-evaluate this?
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 shows just over half the families 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.
ANNA ABEDULLAH: It's aggravating. I mean 23 years of working and you figure you're going to, OK, continue working, and then I don't know where it 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.
ABEDULLAH: I believe that if you, like, dream about it enough, you will get it. So I hope so. Fingers crossed.
CARROLL (on camera): Another point about Mia Sara, 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)
KAYE: So tuition is up and families are struggling to meet the costs.
CNN money.com's Poppy Harlow is back with us.
Poppy, understandably a lot of these students are confused and frustrated.
POPPY HARLOW, CNN MONEY.COM: They are. I have some good news for people though. Let's show you a graphic here and just pull up the tuition increase increases so you can see what we're talking about.
What we say in 2008 was the tuition in state universities went up 6.5 percent. The good news is that when you're looking at Ivy League schools, just like the girl in the last piece, the tuition increases at a lot of those top universities are smaller than ever before. And also what we're seeing at some Ivy League schools like Princeton is they are capping their tuition at about 10 percent of a family's income. For families that fall in a certain income bracket. So that is some good news.
I also talked to an education expert this week, a guy that runs a web site called collegeclickTV. And he told me you should go ahead and apply to the best school you can possibly get into. Then as soon as you get in, you start applying for financial aid. There are more grants than you can imagine out there, and a lot of them are first come first serve. So he said you want to at least try. Always have a backup, but you might as well try. You might surprise yourself on what money is still out there.
Of course, the stimulus package has a lot of money allocated for grants like the Pell Grant, increasing the amount. Look at that. $17.1 billion of that plan going for that college grad. Also work study programs as well. So that is some aid that people will see in just the coming months. A little bit of good news.
KAYE: With the state budget shortfalls, does that affect the student loans?
HARLOW: It definitely does. And your piece going to Detroit and seeing what's happening at that school, that shocked me. And there are a lot of things happening in Michigan. There's a lot of concern they're going to have to reduce their Promise Scholarship n new jersey she cut funding for one of their top merit-based scholarship program. In Nevada, what they're having to do is cut money that used to go to high school kids. The top high school graduates in that state used to sometimes get up to $10,000. They're having to reduce that.
On the state level, it's really affecting things. The stimulus package supposed to help that. But the question is can families foot the difference.
KAYE: So many questions left to be answered. Poppy Harlow, thank you. HARLOW: You're welcome.
KAYE: A lot of you weighing in on this subject of education we have been talking about for some time now.
Alex Wolf, Twittering with us writes, "You have to be kidding me. Bring their own toilet paper?
We told you about that school in Detroit that's asking kids to bring toilet paper.
"I wonder if the schools in the good neighborhoods have to do this. Sad."
And TamTam08 says, "This is beyond sad. I volunteer daily at an urban elementary and I can't imagine asking parents for something so basic."
Handersonjanet writes, "It's crazy, California public schools took the largest hit with the current budget deals. More than prisons."
LBrubaker says, "This is where stimulus money needs to go, to education. Our schools are crumbling across the nation."
Yes, they are.
Untypoed weighs in with this, "I am lucky to be in a school that isn't struggling, but I feel for my former schools that struggles and friend who go through it all."
If you'd like to join the conversation, you certainly can. Log on to Twitter, Facebook, MySpace or iReport.com. We'd love to hear from you. Tell us just what you are thinking on this issue.
Historically, black colleges and universities getting a dose of current events, enrollment going down as the costs go up.
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(CNN ON THE GO)
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KAYE: The economy is taking a toll on historically black colleges and universities where many students rely on financial aid. And as families struggle to pay tuition, enrollment is dropping to the point, some schools are resorting to massive layoffs.
Here's CNN's Sandra Endo.
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SANDRA ENDO, CNN NEWS CORERSPONDENT (voice-over): For sophomore Zakia Williams, at Spelman College, she's found her perfect fit.
ZAKIA WILLIAMS, COLLEGE STUDENT: This place was meant for me.
ENDO: But when the tough economy hit her and her family hard, she packed her bags ready to drop out.
WILLIAMS: I wasn't able to get loans. Neither were my parents. It became really difficult because it seemed like all my avenues were just totally exhausted.
ENDO: It's a familiar story at colleges across the country, but especially at historically black colleges and universities where, in some cases, up to 95 percent of students rely on financial aid to fund their education.
BEVERLY TATUM, PRESIDENT, SPELMAN COLLEGE: Every college and university is asking the question, what will our enrollment be next year? Not because of a change in the institution, but because families are really being hit by the economy every day.
ENDO: On top of shrinking enrollment rates, endowment funds have taken a hit in the stock market. In the Atlanta area alone, Morehouse College laid off 25 adjunct professors. Spelman will be eliminating 35 jobs next year. And Clark Atlanta University's budget ax fell mid- semester with 70 professors and 30 staff members let go.
CARLTON E. BROWN, PRESIDENT, CLARK ATLANTA UNIVESITY: It's been very frustrating, very painful. We are such a good institution that there's no loss of faculty that does not cause pain. We've lost some very, very good people.
DEMETRA ROCHELLE, STUDENT, CLARK ATKANTA UNIVERSITY: We had to adjust to a new teacher. Some of our schedules got changed.
ENDO (on camera): In the middle of the semester. ROCHELLE: Yeah. It was crazy.
ENDO (voice-over): And scholarship money is getting harder to come by. The United Negro College Fund, which doles out scholarships to lower income ethnic students, is anticipating having less money to give.
MICHAEL LOMAX, CEO, UNITED NEGRO COLLEGE FUND: The trend is that we're running about between 15 percent and 20 percent below what we would have raised -- what we projected to raise.
ENDO: To make ends meet, some historically black schools are considering merging with other colleges. And places like South Carolina State University may try to boost enrollment by reaching out to students of all races.
For zakia Williams, a scholarship came through at the last minute, and she says the struggle to stay at a historically black college was worth it.
WILLIAMS: I was completely relieved, and now I'm focusing on my studies.
ENDO: Sandra Endo, CNN, Atlanta.
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KAYE: Just a few minutes ago we took you to a school in Detroit that's actually having kids not only bring their books but bring in paper towels and toilet paper. And a lot of you are really frustrated by this and certainly weighing in on it on our Twitter account.
Sassydiva2 writes, "The U.S., the greatest nation in the world, and we can't provide a decent education for our children. Absolutely disgraceful."
Samleife says, "The stimulus bill gives some money to education but not enough, so that every school can make learning environments better."
Cherilnc says, "It's sad some students are asked to bring their own toilet paper, especially if their parents are already struggling."
Which was the case in Detroit.
And hemppiller says, "Maybe some of the Detroit Piston players could dig deep into their millions and donate T.P. to schools. This T.P. situation is ridiculous."
Not a bad idea there.
And Dezbee2008 says, "Wow, really? I'm afraid with budget cuts so bad here in central Florida, we might start doing that, too."
Let's hope not. We want you, of course, to be part of our show and join our conversation. You can do so by logging on to Twitter, Facebook, MySpace or iReport.com. A lot of you are thinking about this toilet paper situation. Share your thoughts. Tell us what you're thinking.
The price of cheating. Even that is straining the pocketbook. And more couples are choosing to stick together because it's just too costly to stray.
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OBAMA: Dropping out of high school is no longer an option. It's not just quitting on yourself, it's quitting on your country. And this country needs and values the talents of every American. (APPLAUSE). That's why we will provide the support necessary for all young Americans to complete college and meet a new goal. By 2020 America will once again have the highest proportion of college graduates in the world.
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KAYE: It's an auspicious goal the president put forth Tuesday. But the current economic may have some viewing higher education with a more critical and discriminating eye. The bottom line, is it worth it?
Alina Cho has more on today's "Hard Lessons."
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ALINA CHO, CNN NEWS CORRESPONDENT (voice-over): Ask Michelle Destruge the cost of college, and she will tell you -- six figures.
MICHELLE DESTRUGE, COLLEGE GRADUATE: Probably.
CHO (on camera): Staggering.
DESTRUGE: Yeah, it is.
CHO: Her four-year education at Fordham University has saddled her with $119,000 in student loans.
DESTRUGE: When you think about it, it's a large sum. You start to feel hopeless.
CHO: The 25-year-old works at an administrative assistant making about $40,000 a year, but more than half her salary goes toward paying down her college debt.
(on camera): You must lose sleep over this.
DESTRUGE: I did for a little while. And then when you start not paying your loans as well as you do, the companies make sure you lose sleep on it. CHO (voice-over): According to the college boards, two-thirds of college four-year grads have student debt, more than $22,000 on average. And salaries are not keeping pace. After adjusting for inflation, those with bachelor's degrees are actually making less than they were in the year 2000, leaving many with debt they'll be paying off for decades.
So is college worth the expense?
BEN KAUFMAN, BUSINESS OWNER: I learn more a day out of the classroom working in my business, than I could learn in an entire semester.
CHO: Ben Kaufman dropped out of college after one semester to start his own business selling iPod accessories. The 22-year-old is now starting a second business with no regrets.
Yet experts say college is still a good investment.
LAUREN ASHER, INSTITUTUE FOR COLLEGE ACCESS AND SUCCESS: College is more important than ever for getting into and staying in the middle class in this country. In some ways it's replaced the high school degree, even for entry level jobs.
CHO: Destruge admits she probably could have gotten her job with an associate's degree. She's living with her parents, hoping to pay off her debt in ten years. Her dreams, like buying a home, starting a business, even marriage, are all on hold.
(on camera): Was it worth it?
DESTRUGE: I have to say yes.
CHO: What do you really feel though?
DESTRUGE: I feel it was a mistake to leverage myself, but I have to say it was worth it in the end.
CHO: Experts say now, more than ever, it's important to shop around when looking for a college. Apply to a range of schools and once you have gotten your financial aid offer, compare it to the others and then make a decision.
Michelle Destruge says if she could do it all over again, she would take a year off. Looking back, she says she probably could have started at a community college, worked her way through, and then transferred to a four-year institution. She still would have gotten a great education but with far less debt.
Alina Cho, CNN, New York.
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KAYE: So many of you fired up about this issue of education. We have been Twittering with you for last half hour.
Lfitzhugh says, "Schools hurting for money this bad, this country needs to learn it's time to invest in their future or there won't be one."
Sheera612 says, "If the students need to bring in something basic like toilet paper, as they do in Detroit, what else do they not have? Books, paper, pencils?"
Connectingwomen weighs in with this, "It's so sad that the government is so quick to bail out banks but not public schools."
Well, the money is on the way, they say.
KellySutton writes, "Why do universities not have to cut back spending? Any amount of tuition increases these days is absurd."
So if you have some thoughts on education or anything else that's on your mind, logon to Twitter, Facebook, MySpace, or iReport.com and tell me what you're thinking. I would love to hear from you.
The news continues right now.
Get used to that sound. Many of you will hear it all night long. Driving is dangerous enough, but thinking of flying somewhere? Well, forget about it.
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UNIDENTIFIED MALE: They're staying together because they can't afford to get their own place.
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KAYE: Cheaper to keep her, or him. Even hanky-panky is taking a hit in this economy. It's a true sign of the times.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: It took my breath away is all I can say. I, you know, oh, really? I mean, is that possible?
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KAYE: Retirement wiped out. 90 years old and back to work. And the man he blames is living in luxury.
The news starts now.
