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GM's New CEO Holds Press Conference; President Obama Might Encounter Blame at Economic Summit; Madonna Plans Second Malawi Adoption; 2 Residents Stay Behind to Update Flooded-Out Neighbors
Aired March 31, 2009 - 10:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
HEIDI COLLINS, CNN ANCHOR: Just a day after the top man was forced out at General Motors, his successor races the taxpayers who had bailed out his company. Fritz Henderson, GM's new CEO is due to hold a news conference any moment now. We are keeping our eye on those pictures for you just as soon as he comes to the microphones. We will bring them to you.
We should let you know, he was serving as the chief operating officer of General Motors. He started his career with the company in 1984. So obviously, he has been there for quite some time. We learned yesterday Rick Wagoner, the former CEO of General Motors actually said that he was the ideal person for this job. They are getting ready to introduce him now. So we will continue to watch that.
We also heard from some of our correspondents and also the former editor of "Car and Driver" magazine saying the only thing he was concerned about is the fact that Fritz Henderson is not known for having a history of being a product development type person. And clearly that is something that many people are looking for here in hoping for the success of General Motors.
So, once again, the new CEO of General Motors, Fritz Henderson is coming out any moment, and we're going to go ahead and listen in right now. Let's go ahead and listen.
FRITZ HENDERSON, CEO, GENERAL MOTORS: Good morning. I have with me - I have a few of my colleagues with me this morning. We have Troy Clark. Right there, Ray Young, our CFO, and Mark LaNeve, head of sales and marketing here for North America. So I think - and then we have a number of people from Steve's organization, as well. But first of all, good morning, thanks everybody for coming.
Before I get started covering my remarks, actually, what I wanted to do is remind everybody we're in the car and truck business. And this morning, we were going to have a chance - we're going to announce to you first this morning what we're going to be doing in the marketplace beginning immediately. I'm going to ask Mark LaNeve to come up in a minute and take you through the program. But we're going to announce a program that is intended to do what General Motors needs to do in the future, every day, every single moment of our lives, which is put the customer first.
I'm excited. My first announcement is to be able to talk about a program like this. It's bold, it's unprecedented, it's called the GM Total Confidence program. What is that program? It's basically four parts. First, it combines protection for the customer for automatic payment protection. Second, and I'll have Mark take you through the details. Second, we're going to provide equity assistance to the customer in the event that they have difficulty with their trade-in, and when they're purchasing a new General Motors vehicle.
And then we will couple those two elements of the program with our five-year 100,000 mile power train warranty, and one year free - free coverage of on star safety and security package. So it's really about providing a full range of protection for the customer. We're announcing it right now, and Mark, why don't you come on up and take the group through that. Thanks.
MARK LANEVE, CFO, GENERAL MOTORS: Thanks, Fritz. I'm going to set up here. Terrific. We're really excited to be getting this program into the market. We went out and - the last few months, obviously, Mark, has been very tough. And what we found is the traditional leverage, zero percent financing, big rebates, just wouldn't work and everybody was kind of settling into an abnormally low volume number. Went out and spent a lot of time with customers.
Obviously, consumer confidence is the big issue. What would it take to make you feel comfortable to reenter the market. And I would like to tell you that my team designed the program, but really the customers designed it. And we're executing it. We're really excited, layers on top of what is already great incentives in the market, like zero percent financing.
And here's what the customers said they wanted, really strong warranty protection, with the best coverage in the industry, five- year, 100,000 mile. Safety and security for their family. We have on star system standard. No one else has it. Industry exclusive, it's also part of the package. We're going to provide payment protection up to 24 months. We'll make nine payments of $500 if the customer loses their source of income. And unprecedented equity protection, which a lot of customers are worried about given last year, what happened across all manufacturers in the resale market, worried about the equity of their vehicle.
So we will pay the balance of what you owe on your payments and you don't have to finance through GMAC, just any contract and what any DA retail value is. Unprecedented level of protection when you trade your vehicle in on a new GM vehicle. So really excited to get this program in the market. We have a press release where you will get more details. We also have a comparison of our program to the Hyundai assurance program, and what Ford announced this morning. Ours is a package we believe is clearly superior in terms of total customer confidence, a total wrap-around package, back stop to the customer. It's effective tomorrow and runs through April 30th. We will extend it if it's effective, and we begin advertising tomorrow with a big splash on the final four to get the message out.
So we're real excited about this, Fritz, and as Fritz said, it's all about selling cars and trucks. We forget that sometimes, we really believe it's going to be a great program in the market.
HENDERSON: Appreciate it.
Mark, why don't we take a few questions on this program first, and then we'll turn it back over to Fritz. If somebody have a question about we just announced.
QUESTION: Is that a dollar amount limit?
LANEVE: The way it works, the equity protection - we'll have details in the press release, plus on our website, gmconfidence.com, which should be active now. If you have a 60-month contract, once you have made the 30th payment, you become eligible for the program. So halfway through your contract, we will pay the difference between the balance of your payments, if there is a difference. We hope that there isn't, because our resale values are actually pretty strong and any DA retail of up to $5,000, and that should cover the vast majority of any customer situations, whether beyond equity if at all.
We actually think it's highly unlikely most customers will have to use it, but it's there as a back stop, as an insurance program.
QUESTION: (OFF-MIKE)
LANEVE: Right. When they trade in on another GM vehicle.
QUESTION: (OFF-MIKE)
QUESTION: Jeff Flock from Fox Business. Over the course of 24 months, you'll make nine payments of up to $500 a month, if someone loses their job? Is that what you're saying.
LANEVE: Right. Real simple. Qualification. You have to have - just like other programs out there, you have to have three payments to vest in the program, make your initial three payments. And if you qualify for state unemployment benefits, then you qualify for our program. It will make up to nine payments - nine consecutive payments, up to $500, if the customer is qualified for state unemployment benefits, as a payment protection program.
It's far superior to the Hyundai assurance program, which is three payments. And ours lasts for 24 months, not just 12 months, like their program.
QUESTION: Twelve months, correct?
LANEVE: Ford is doing 12 months, but the eligibility program is only nine months. So their eligibility period runs out in January. So their program is somewhat confusing. I actually called their call center this morning, they didn't know anything about it. So we'll give more details as we go through the next couple of weeks.
COLLINS: All right. Just taking some questions here now, as we can see. We heard just a little bit from the new CEO, Fritz Henderson, and turned it over to his colleague Mark LaNeve there, too. Run down that kind of calling here a buyer protection plan.
CNN's Poppy Harlow is standing by now and has been listening to this news conference, as well. Poppy, I know we're going to talk about Ford and what they're doing...
POPPY HARLOW, CNNMONEY.COM CORRESPONDENT: Yes.
COLLINS: But what did that sound like from GM here. It sounds like they're launching sort of a similar plan?
HARLOW: Yes, really interesting, Heidi. Fighting words coming out of General Motors, saying their plan is far superior to that Hyundai insurance plan, and then the news out of Ford this morning, what you just heard - explained here.
Let's run through the details for you, folks. First of all, that's what Ford is doing. Ford is covering up to 12 monthly payments, up to $700 a month. But if we can take that graphic down, I want to explain to you how that compares with what General Motors is saying. Because GM is saying they'll make nine payments of up to $500 a month. They are also talking about how the plan is far superior to Hyundai's and also General Motors. It starts tomorrow.
It runs through April 30th. They're going to judge the success then, possibly carry it longer. They say you can go to gmconfidence.com, and Heidi, it's interesting, this comes right on the heels of the news for Ford, really becoming sort of the industry standard right now -
COLLINS: Yes.
HARLOW: It looks like. So let's go through the Ford plan that came out this morning. That's called Drive One. That deal is going to cover up to 12 months of payments. I should be clear, this is if you lose your job and you are on state unemployment benefits. Then this will apply for you.
COLLINS: Right.
HARLOW: For Ford, this applies to their Ford models. The Lincoln, the Mercury models. Ford is also going to offer zero percent financing on some of the vehicles, trying to get the customer in, when credit is tight. I asked "Fortune" senior editor Alex Taylor just a few minutes ago about this Ford program and he said really this is just a sales ploy. Of course, Ford and any other automakers are going to weigh the risks to the customers that can apply for this program of course, Heidi. But it's interesting, I wonder how many other automakers are going to come out with this now, because it seems to be competitive, you've got to offer this at this point.
COLLINS: Yes. We should be clear also that Ford is a little bit different here when we're talking about Chrysler and GM and all that, they didn't take any bailout money.
HARLOW: That's exactly right. This morning, Ford's president Mark Fields said on AMERICAN MORNING, the reason they haven't taken that at this point is because of Ford's focus on those smaller, more fuel-efficient vehicles saying they have been restructuring for three years. Listen quickly to some sound from him.
(BEGIN VIDEO CLIP)
MARK FIELDS, EXECUTIVE VICE PRESIDNET, FORD MOTORS: We don't feel we're being disadvantaged, because we have been restructuring our company over the past three years. We have been investing in high-quality fuel-efficient vehicles over the last couple of years, which are just starting to come to the marketplace.
So our approach is, continue to work this plan, continue to make sure that Ford remains competitive, both today and in the future. And continue to work with our stakeholders to make sure that happens.
(END VIDEO CLIP)
HARLOW: All right. He's talking, Heidi, about all these fuel- efficient models.
COLLINS: Right.
HARLOW: I want to show you one. I think we can bring it up here on the monitor. We're going to try to, quickly. It is the Ford Fusion hybrid, it has 41 miles to the gallon. And then there is also a gas model as well that gets 34 miles on the highway. That gas model costs under $20,000. So the Obama administration has said time and time again, it's the small, fuel-efficient cars that are the keys to turning Detroit around.
COLLINS: Yes.
HARLOW: Yesterday, the automotive task force criticized GM and Chrysler saying really their reliance on trucks and SUVs is going to cause them to struggle, saying Chrysler is going to struggle with fuel efficiency standards, and GM's Volt, that electric car that everyone is waiting for, is going to hit the showrooms in 2010 is going to be too expensive to help the company turn around in the short-term. So a lot of questions out there, but really these new incentive programs this morning very interesting, Heidi, from GM and from Ford.
COLLINS: Yes, we'll have to wait and see if there are more that are going to be launched from other companies, as well. All right.
HARLOW: I'm sure there will be.
COLLINS: Yes. I am, too. All right. Poppy Harlow, thank you.
HARLOW: Sure.
COLLINS: The health of the U.S. economy is on the president's mind as he heads to London today. President Obama was wheels up about 90 minutes ago. He is headed to London for the G-20 summit. He will be joining world leaders as they try to come up with critical solutions to the world's economic crisis. After London, he's got stops in France, Germany, the Czech Republic and Turkey. CNN's White House correspondent Dan Lothian joining us now live outside the White House.
Dan, what does the president hope to accomplish during this trip? There is an awful lot on his plate.
DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: There is an awful lot on his plate, and obviously he hopes to be able to come up with a global solution to fix the global economic crisis, and the focus, of course, will be, at least from the U.S. side, is to try to push some of these world leaders into establishing their own stimulus and bailout plans, much like what has happened here in the United States.
The president has always said that he believes that recovery - economic recovery in this country can only happen if there is an economic recovery globally. And so we will see him pushing for that. But there has been a little bit of a push-back from some world leaders who want to see more regulatory reform. They want things in place that will prevent another global crisis like this. The president has been asked about this repeatedly, and he said it's not an either/or, he believes that you can't have stimulus and bailout to assist in jumpstarting the economy, but also regulations.
So those are some of the issues that will be coming up as the president heads overseas. But also he'll be going to the NATO summit, and the focus there will be Afghanistan, the president trying to get some of the allies and other world leaders on board with his recently announced Afghanistan plan, where he is sending in 4,000 troops, in addition to those 17,000 troops announced earlier this year. Trying to get these world leaders to commit to not only send in personnel, but also financial assistance, Heidi.
COLLINS: All right. Dan, also, he's going to wrap up the whole trip in Turkey, right?
LOTHIAN: That's right.
COLLINS: He's going to give a speech there, too.
LOTHIAN: That's right. And it's not the speech that the president was talking about during the campaign where he said - during his first 100 days he wanted to go to a Muslim country, and make a speech. We're told by the White House that this is not that speech that he was referring to. But it is a predominantly Muslim country.
The president will be going there and meeting with their political leadership, as well as some religious leaders, and sitting down for a round table with students. And the president realizes that this is a key ally, and he is hopeful that they can assist in the goals that the U.S. has for Iraq and Afghanistan.
COLLINS: Wow, certainly a lot on his plate. We have a lot on our plate, too, Dan. Thanks so much. I want to get to breaking news quickly now.
We are learning about a suspicious package that has been found in London. Our Paula Newton is standing by now to give us the very latest in all this. Paula, I understand that they have detonated this package, as well?
PAULA NEWTON, CNN CORRESPONDENT: They have. They performed a controlled detonation with a robot. They still say they have no idea if it was something harmless or something much, much more lethal than that. They saw a suspect package underneath a bench here near the Bank of England and decided to take no chances. They cordoned off the area, evacuated some people and closed off all the traffic. It's causing a lot of chaos here in the heart of the financial center in London, but police telling us, Heidi, that they still are not sure what they're dealing with.
COLLINS: So what's the next step then, Paula? Have there been any evacuations or anything?
NEWTON: They're contemplating now if they need to evacuate any of the other buildings, but they only found one suspect package. So far, as I said they've performed a controlled detonation of that. What they're doing now is to try to sweep the area to see if they're going to find anything else and then make a decision if they can open up back to traffic, or head in the other direction which would be to evacuate a lot of the surrounding buildings.
COLLINS: And obviously, we want to mention here now, the reason why this could become something that we clearly need to keep an eye on, the president on his way. President Barack Obama on his way to London talking about the G-20, as well. So clearly we will stay on top of this for you. Our Paula Newton, bringing breaking news to us live. We will stay on top of that. Actually taking aim at the world economic crisis.
Now, world leaders are ready to try and adjust the big picture. We're looking at what kind of impact the G-20 summit may have.
(COMMERCIAL BREAK)
COLLINS: So how will President Obama be received on his first overseas trip since taking office? The response he gets could dictate how effective the president can be during the G-20 discussions. We have some new poll numbers to show you this morning. According to our CNN opinion research corporation poll, 72 percent saying they think other world leaders respect President Obama, and 86 percent think the president will do a good job representing the U.S. on the global stage. Thirteen percent are not so confident.
What kind of impact should we expect from the G-20? There's been a lot of discussion about that, and how will President Obama do on his first big test of international power?
CNN's Jim Clancy is here with me in Atlanta to talk a little bit about the president's possible influence, but we want to begin with our Christine Romans in New York this morning, because Christine, yesterday you said something that caught my attention. You said, this G-20 conference was perhaps the most important economic summit since World War II. Tell us why.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Well, look, after World War II, you had world leaders get together and try to figure out how to hammer a framework, Heidi, so that there could be prosperity for everyone in the coming decade. And that system that they hammered out at this Brettonwoods conference in New Hampshire is essentially a system that has now come to its knees because of the financial crisis.
And so you have people questioning western-style capitalism and wondering how we're going to go forward here, and who are going to be the leaders in the new financial architecture. How we're going to get out of here is incredibly important in what the system is going to look like down the road, and that's what these people are going to be talking about in the G-20. And it's a discussion, quite frankly, that is expected to continue after this, maybe for months ahead. You got the president and his team really pushing regulation and also global stimulus, but not everybody - not all of our friends and allies see exactly eye to eye how we should do this.
COLLINS: No. Definitely not. In fact, I'm looking at what we call a lower third, if you will a make or break summit even that I think is what George Soros said that we were talking about a little bit earlier.
Jim Clancy, to you now. President Obama is popular internationally, but it seems to me...
JIM CLANCY, CNN CORRESPONDENT: To say the least.
COLLINS: Yes. It seems to me that there is this whole political side of things, of course, when you're talking about a G-20 and then the economic side of things. His policy is not quite as popular, at least as of right now, as the person that he is.
CLANCY: You know, Heidi, this is a G-20. He is going there as three human beings. He is going there as Barack Obama, the rock star. He's going to dazzle them, no doubt about it. He's going there as the leader of the United States of America. He's going to do well. You know, his message of change, though, could be problematic, because just like in the United States around the world, everybody says he's going to change everything. Well, he's not going to change everything.
But finally, it's going to be his image as leader of the free world, and as Christine Romans is just pointing out there, the biggest global economic crisis we have seen in decades...
COLLINS: Yes.
CLANCY: It's going to be a test of leadership. How can he lead? The Europeans, remember, don't agree with U.S. strategy.
COLLINS: Well, in fact, we've been hearing a little bit about the possibility of the French president Nicholas Sarkozy, kind of snubbing the whole thing and saying I'm not going to come.
CLANCY: Well, Sarkozy is a little bit like Napoleon. They were both short. They both have images of French grandeur. But the point is like in Afghanistan, Sarkozy is telling the world today, we'll send more money, but we're not going to send anymore troops. The issue of Afghanistan and Pakistan are issues of security that are shared by everybody in Europe, and for that matter, everybody right around the world. And we don't need somebody to serve the brie and croissant, we need somebody to pitch in and do the work. Now, it may not all be military but some of it has to be the nation building that has to go on in Afghanistan.
COLLINS: Yes. Absolutely. Christine, I want to get back to you because Jim is talking about - a little bit here something disagreements, of course, the other countries have, and you were saying the same things, not everybody agrees with how this new plan is coming forward. Talk to us a little bit about the plan.
ROMANS: Sure.
COLLINS: They want each country to commit two percent of their gross domestic product.
ROMANS: Well, look, here's the thing. What they have agreed on so far, there has been a draft communication that's gone out.
COLLINS: Right.
ROMANS: The things that they do agree on is this. They've agreed on foreswearing national protectionism. You know, they want - every country who wants to say, look, we need to think things together on a global scale, so we want to foreswear protectionism. We also want to talk about global regulation, that we're going to have better regulation of things like hedge funds and better capitalization of financial firms, so they don't get in trouble again.
And they're trying to find the common ground here in the near term, to make sure that we have a - a G-20 communicate that shows cooperation and not discord. And that's what George Soros is talking about when he said it's a make or break for global markets. Global markets don't want to see a big rift between the United States and the UK and the EU and our other partners. That is not the time for a rift right here.
They want to see global cooperation, and they want to make sure that this is about repairing the current financial system, and not about - you know, not about arguments and disunity.
COLLINS: Yes. So what do you think is going to become of this? Jim, start with you.
CLANCY: Well, you know, the real question is how you're going to fix the economy. You know, the global economy. The U.S. says let's deficit spend if we have to. Bigger stimulus packages. This, the Europeans are frightened to death. We're going to see a lot of people at this summit pointing a finger at the United States. You caused it, Brazil's president Lula Da Silva. Well, look, if he says, you know, it wasn't people of color. It was white-haired, white-faced, blue- eyed people...
COLLINS: Blue-eyed...
CLANCY: That we're behind all of this. There's a lot of anger at Wall Street, but a lot of people want to evade the responsibility of what role they really had in all of this, and they want to push it all on the United States. Barack Obama is going to have to listen to them when they're talking about this regulation. It can't all be about spending. Something has got to change.
COLLINS: All right. Well, to the two of you, we could talk all day about all of this. Let's hope there is a lot of talk that goes on the G-20, as well. Jim Clancy, sure do appreciate that, and Christine Romans coming to us from New York, as well. Thank you, guys.
A new food warning for you this morning. The FDA is advising against eating pistachios. Some of the products may be tainted with Salmonella.
(COMMERCIAL BREAK)
COLLINS: This just into the CNN NEWSROOM. I want to get it out to you just as soon as we get it here. Tobacco giant Philip Morris apparently lost another round today in a nearly $80 million punitive damages case that was a decade-long case. In fact, very, very complex between U.S. Supreme Court justices and their state counterparts in Oregon.
Here's what it boils down to. Lots of issues with how the Oregon Supreme Court dealt with direction from the U.S. Supreme Court on how to handle a case. This was the issue of power of juries and whether or not they can impose large punitive damage awards against huge corporations in certain product liability lawsuits. The whole case was brought by the widow of a long-time smoker who actually sued the nation's largest cigarette maker.
So once again, tobacco giant Philip Morris lost another round today in this $80 million punitive damages case. We'll keep our eye on top of that and tell what you it means for the bigger picture, as well.
Food and safety officials are warning against eating pistachios while they figure out the source of a Salmonella contamination. Setton Farms, a processing plant in California has recalled two million pounds now of roasted pistachios that may be tainted with that bacteria. Nobody has gotten sick from eating the nuts, but Salmonella strains were discovered last week during a routine test. The FDA also advising consumers not to throw them out, either, because additional recalls may be likely.
We want to go live now to Capitol Hill where a senate committee is considering Kansas Governor Kathleen Sebelius' nomination to be Health and Human Service Secretary. Sebelius is the latest Obama administration pick for the job. The president initially tapped Tom Daschle for the position, but as you remember, he withdrew his name after a tax investigation. Kathleen Sebelius says health care reform would be her mission if in fact she is confirmed.
ANNOUNCER: Live in the CNN NEWSROOM, Heidi Collins.
COLLINS: The housing market hit again. A new study shows home prices plunged in January by a record amount. Susan Lisovicz is at the New York stock exchange now with details on that as well as a look at the big board. Hi there, Susan.
SUSAN LISOVICZ, CNN CORRESPONDENT: Hi, Heidi. We're seeing stock prices rise, but home prices unfortunately in 20 major cities fell 19 percent in January compared to the year earlier. And, yes, this is another record. This is from the S&P Case-Shiller report. Prices in all the 20 cities that it surveys declined.
Where was the hardest-hit region? The sun belt, where there was so much speculation. Cities like Phoenix and Las Vegas where we saw prices fall more than 30%. Of course, there was a huge housing boom. People rushed in a few years ago, completely different story. Cities that weren't so affected in the sunbelt, Dallas and Denver, where we saw prices fall about five percent. And Atlanta, Heidi?
COLLINS: Yes.
LISOVICZ: Fell 14 percent from a year earlier. So right in the middle.
COLLINS: Well, it's hard. Like a double-edged sword. If you're a buyer, it's great to be able to get a deal, if you will, because everybody is looking for a deal, these low prices on homes. But really, the bigger picture, the economy needs these prices to go up.
LISOVICZ: No question about it. I mean, we've - we've seen the extremes. We saw a huge bubble. That's burst. And now we've seen the floor give way. And so we need some stabilization. And we've seen the ramifications of that. Home builders, furniture suppliers, retailers, like Home Depot and Lowe.
And, of course, the phenomenon of the upside down mortgage, where you owe more on your mortgage than your house is worth. Home prices, Heidi, have fallen in the past 30 months. Foreclosures continuing to be a big contribution from that.
We did get some hope, some glimmers of hope this month. Existing and new home sales rose. But we will see -- need to see more buyers. They will need to be able to get mortgages. And mortgages are also coming down, another good sign. That will help stabilize prices -- Heidi.
COLLINS: Well, Wall Street seems to be taking the report in stride, though. Stocks are up about 100 points or so.
LISOVICZ: Yes, we're seeing a nice rebound. Of course, we had a sell-off yesterday, but we've had a nice couple of weeks, and this is the final trading day of the month. And we should see Dow -- the Dow industrial is the most closely watched index in the world -- register a gain after six straight months of declines.
Check it out for yourself. Right now, the blue chips up 96 points at 1.25 percent. The Nasdaq is up 1 2/3 percent. Tech companies, by the way, doing better than the broader market. They're still hanging in there. IBM the best-performing Dow 30 stock -- Heidi.
COLLINS: All right. Susan Lisovicz, thanks for that. Appreciate it.
Seven hundred billion dollars of your money. Do you know how it's being spent? That is the question this hour on Capitol Hill. Live pictures for you there. Members of Senate Finance Committee are looking at the Troubled Assets Relief Program or TARP as you probably know it. It's now been six months since the measure was signed into law by President Bush. We'll keep our eye on that for you.
Ford Motor Company doing the best of the Big Three automakers, but still struggling nonetheless. Slow sales have forced Ford to pause some of its plant, meaning that workers will be laid off while the production goes idle. In Chicago, some 1,400 workers will face three weeks without a paycheck. The bright news for them, their plant may be in the running to produce the new Explorer SUV.
(BEGIN VIDEO CLIP)
DAVID SCHOENECKER, CHICAGO UAW LOCAL 551: How much would we need this? Let me put it to you like this. I would most likely see approximately 8-900 people getting their jobs back, in a sense that we would probably have to go back to two shifts.
(END VIDEO CLIP)
COLLINS: Ford has not accepted any of the taxpayer bailout money. And earlier this morning on CNN, the company said it has no plans to do so.
The president on a trip to Europe, but he could be in for an earful when he gets there. Some protesters are taking aim at America's economic policies.
(COMMERCIAL BREAK)
COLLINS: President Obama is on his way to Europe right now for G-20 summit and his big debut on the world stage. He and first lady Michelle Obama got on board Air France One -- Air Force One, pardon me, a little earlier this morning. Their tour has them visiting five countries over eight days. I guess that's why it was confusing to me.
And as CNN's Candy Crowley explains, it's no European vacation. It could be the first true test of the president's popularity overseas.
(BEGIN VIDEOTAPE)
CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT (voice-over): President Obama is a popular man abroad. U.S. policy, not so much.
CHRYSTIA FREELAND, "FINANCIAL TIMES": You might even go so far as to call an ideological rift between the Europeans and the Americans.
CROWLEY: The rift is over global recession. The president wants more countries to put more money into their own economies, a la his stimulus plan. BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We don't want a situation in which some countries are making extraordinary efforts and other countries aren't, with the hope that somehow the countries that are making those important steps lift everybody up.
CROWLEY: Reaction has been cool to hostile. The outgoing Czech prime minister blistered the idea and the U.S. recovery plan.
MIREK TOPOLANEK, CZECH PRIME MINISTER (through translator): All of these steps, the combination and the permanency is a way to hell.
CROWLEY: Rather than putting more money into their economies, many countries want tighter financial regulation. Complicating things, many heads of state are less inclined to follow the U.S. lead, blaming America for the worldwide recession. Consider this screed from the Brazilian president.
LUIZ INACIO LULA DA SILVA, PRESIDENT OF BRAZIL: This crisis was not created by blacks nor Indians nor poor people. It was a crisis that was created and spread throughout the world due to the irresponsible behavior of white people, blue-eyed people that thought they knew everything.
CROWLEY: Others have made a similar point without the racial assault. Bottom line: That whole capitalism/anti- protectionism/deregulation combo has lost some shine.
There is risk President Obama could leave empty-handed, but observers say the bar for success is low. A communique with broad language on stimulus, financial regulation and protectionism will do.
FREELAND: I think what we're going to see coming out of this summit is much less really concrete actions and a concrete plan, and much more a focus on a show of global unity, which in and of itself could be reassuring for the markets.
CROWLEY: Considered the most popular U.S. president abroad since JFK, President Obama is not likely to lose his shine, regardless of what happens at the G-20. He will almost certainly see streets lined with supporters, but he'll also see something else.
UNIDENTIFIED MALE: It's capitalism's fault alone. Come to the revolution, 1st of April, Bank of England.
CROWLEY: Candy Crowley, CNN, Washington.
(END VIDEOTAPE)
COLLINS: More details now about the G-20. The group is made up of top financial officials from 19 nations and the European Union. These items are topping the G-20 agenda this year: Discussing a possible global stimulus package; looking for ways to stop countries from limiting trade just to protect their own businesses; helping developing nations where the recession is hitting hard; and coming up with better ways to regulate the financial markets. A show of American support for Afghanistan's plan to hold talks with moderate Taliban members. Secretary of State Hillary Clinton is at the Hague in the Netherlands today. She spoke at a conference on bringing stability to Afghanistan. Clinton backed the idea of opening a dialogue with less extreme members of the Taliban.
This after President Obama announced plans to send 4,000 more troops to the country. That's on top of the 17,000 he already approved to fight the Taliban.
Pop star Madonna facing a lot of criticism about adopting a second child from Africa. What's so wrong with rescuing a child from a life of poverty and hopelessness?
(COMMERCIAL BREAK)
COLLINS: Madonna's going to have to wait a few more days before learning she can adopt a second child from the African nation of Malawi. The child would be rescued from poverty and likely an early death, but critics say there is more to the story. Here now, our David Mattingly.
(BEGIN VIDEOTAPE)
DAVID MATTINGLY, CNN NATIONAL CORRESPONDENT (voice-over): In search of her fourth child, Madonna entered a courtroom in Malawi under a familiar glare of controversy. If successful, it would be her second adoption from this impoverished African nation. But not everyone believes that this is the best thing for the child.
DOMINIC NUTT, SAVE THE CHILDREN UK: In majority of cases, orphans -- so-called orphans -- in fact, not orphans -- that have at least one parent living and even those that don't, have a wider family that can look after them. And we believe that children in poverty should be best looked after by their own people in their own environment.
MATTINGLY: CNN has not confirmed the child's family information. News reports say she's a 4-year-old girl named Chifundo James (ph). Her mother reportedly died shortly after giving birth, and she has a grandfather and two uncles.
Just like in 2006, when Madonna adopted a 13-month-old boy named David, her visit to Malawi is a collision of two worlds. Madonna's private jet touched down in a country where more than six out of 10 live on less than $2 a day.
UNIDENTIFIED MALE: How does it feel to be back in Malawi, Madonna?
MADONNA, SINGER: Amazing.
UNIDENTIFIED MALE: Can you tell us why you're adopting again, Madonna?
MADONNA: No. UNIDENTIFIED MALE: Can you understand people's reservations about it, seriously?
MADONNA: No. It's none of their business.
MATTINGLY (on camera): Madonna's spokeswoman in New York doesn't have anything to say about the criticism right now either. But that may change later in the week. The judge in Malawi is expected to rule on Friday, and Madonna will have to be present.
(voice-over): For the child, it would be the change of a lifetime. If she stays in Malawi, the average life expectancy for women is just 43. There's a less than 50-50 chance she will learn to read and write.
AUSTIN MSOWOYA, LAW COMMISSION OF MALAWI: If you project 20 years from now, where will the child be if the child is left in the orphanage where it is, or if it gets a chance to get an education with Madonna?
MADONNA, IN AD FOR FILM "I AM BECAUSE WE ARE": People always ask me why I chose Malawi.
MATTINGLY: And Madonna's connection to Malawi and children goes beyond adoption. She stars in a documentary calling attention to children orphaned by AIDS.
It is a new kind of performance for the pop superstar, a role that is now apparently very personal.
David Mattingly, CNN, Atlanta.
(END VIDEOTAPE)
COLLINS: Also want to give you a little bit more information coming to us. CNN entertainment and "SHOWBIZ TONIGHT" actually getting this information from Madonna's spokesperson, Liz Rosenberg. We are learning from this -- Liz Rosenberg that she can officially confirm that Madonna has indeed filed an application to adopt Mercy James (ph), the 3-year-old girl Madonna met two years ago in an orphanage that she visited. So, there is the update on that story.
When it comes to New England's great receivers, Randy Moss has nothing on two Massachusetts men. They caught an 18-month-old girl who fell from a third-story window outside Boston. One of the guys was on his way to Bible study when he looked up in surprise.
(BEGIN VIDEO CLIP)
ALEX DAY, CAUGHT TODDLER: We were here, and the baby fell right into my arms, and, you know, had he caught, like, the back end of her. So, it was really good that he was there. It was a blessing.
RACHAEL CLARK, MOTHER: Thank you, Alex, and thank you, Robert. Thank you. You guys are angels.
(END VIDEO CLIP)
COLLINS: Dad says he was giving another child a bath when it happened. He thinks one of his older kids might have unlocked the window. But the little girl is OK.
A new cyberthreat to tell you about. Millions of computers may be infected already. Is yours one of them? You'll find out in hours, unless you follow our advice right now.
First, let's check in with CNN meteorologist Rob Marciano.
ROB MARCIANO, AMS METEOROLOGIST: Hello, Heidi. The river up there in North Dakota and Minnesota continues to fall, but flooding still a rsik as they're getting battered by a nasty winter storm. Meanwhile, to the south, a tornado watch or a severe thunderstorm watch, excuse me, has just been posted for that chunk of Mississippi and Louisiana. We run down weather when the CNN NEWSROOM comes right back.
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COLLINS: Well, the water level may be going down, but the flood threat -- boy, that's for sure -- is not over for cities like Fargo, North Dakota. We've been watching now for several days, obviously. Our Rob Marciano is watching that, among other things.
MARCIANO: Yes, the flood level is slowly going down, and that's going to be the theme for the next few days.
COLLINS: Well, look at the snow!
MARCIANO; Yes, look at the snow. And, you know, we haven't got a whole lot of aerial footage from this flood, and now that we're seeing it from the air, you really start to see the magnitude and the expanse of it all, because it's just tough to picture it from a snowy side of river, especially when the visibilities have been so poor as they have.
Snowing now. It's been snowing for the last 12 hours. About a half-foot of snow has been recorded on the ground there, and it continues to come down not only in Fargo, but across river in Moorhead, Minnesota. Winter storm warnings continue to be posted.
And it's not so much the amount of snow they're going to get. I don't think it's going to be as big of an issue, Heidi. But more so the pounding of the winds because the winds are kind of hitting that river, and in some cases, the river has become a lake. And so now you've got waves that are generated on that lake, and those waves are putting added pressure on the levees.
And remember, the flood warning or the flood stage, I should say, and here it is. Even though it's come down, it's still in major flood level. So, it's not even down to moderate flood stage yet, and we don't expect that to happen for several days to come.
So, this area of low pressure slowly moving off toward the north and east, and as it does so, the back side of it certainly bringing in quite a bit of snow, but also wind. These are the wind gauge estimates here for the past hour, generally between 20 and 25 miles per hour sustained between Fargo and Aberdeen. So, that's going to continue, I think, for the next 12 to 24 hours, as this thing is still such a slow mover.
Another 6 to 12 inches of snow, potentially. Obviously the wind, blizzard warnings south of Fargo in through parts of South Dakota. And we speak about the southern expanse of this storm. It's tapping moisture from the Gulf of Mexico. We did have a tornado warning out for Nacogdoches, Louisiana, and that line of thunderstorms now moving into an area that's even more juiced up. So, the Storms Prediction Center has issued a severe thunderstorm watch in effect for this area until 2:00 this afternoon, and that line about to roll through Alexandria, Louisiana, will be doing some damage as far as some gusty winds and heavy rain.
I should note, the snowfall in Fargo, it will add up for another 6 to 12 inches, as we mentioned. But that will not get released into the river very quickly. So, that will take some time. And over the next 10, even 15 days, we suspect temperatures will remain at or close to freezing, Heidi, which would be good. That means the snowmelt really isn't going to aggravate the situation until we get really well into April, if not May.
COLLINS: OK. Wow. All right. Definitely looking for some good news there. That's for sure. Rob Marciano, thanks for that.
Also, people in the flood zone have been sending us some pretty incredible images. Look at this now. IReporter Peter Fry lives in Briarwood. That's a community just south of Fargo. Much of it has been taken overtaken by the Red River, including his family's home.
His friend, John Kenney, was visiting Saturday when the wooden levee in the front yard broke. You can see what happened. Everybody made it to the roof OK. 911 was called, and a helicopter actually lifted them to safety.
While most people left in Briarwood have left town, two men are hanging around for a kind of flooding neighborhood watch. CNN's Gary Tuchman has their story.
(BEGIN VIDEOTAPE)
GARY TUCHMAN, CNN NATIONAL CORRESPONDENT (voice-over): The Red River has not gone as high as expected. But that's bittersweet in a tiny town just south of Fargo, because in Briarwood, population just shy of 100, it went plenty high enough.
(on camera): One of the charms of Briarwood, North Dakota, is that it's by the river. But now, much of it is in the river.
It also flooded here in 1997 and took a long time to clean up and rebuild. And now, a little over a decade later, the people here have to do it again.
(voice-over): There are only 26 homes in this affluent town; 18 of them have been flooded.
MIKE, BRIARWOOD RESIDENT: When you love an area this much to live here, this is some of the stuff you have to put up with.
TUCHMAN: Mike is one of the lucky ones.
UNIDENTIFIED MALE: Forty years of living on the river, you kind of know what to expect.
TUCHMAN: And so is his friend, Paul. They and both their families live in two of the eight dry houses. So they are walking through the 34-degree water with their boat in case the water gets too deep, so they can call their evacuated neighbors to let them know about the flood damage to their homes.
MIKE: I would guess a foot to a foot and a half you're looking at. Is that what you guess, Paul?
TUCHMAN: They are talking to the owners of this home, Mike and Lauren Falkner, who had to evacuate.
LAUREN FALKNER, BRIARWOOD EVACUEE: We left by boat. And the currents were already so strong. And so we took, you know, one small suitcase, a laptop and a couple of small bags.
MIKE FALKNER, BRIARWOOD EVACUEE: Yes.
TUCHMAN: The water levels are down. Here you can see the icicles where the water was this weekend, about two feet above where the level is now. But the damage has been done inside these homes.
The Falkners have flood insurance, which will cover two-thirds of the price of their home. But they have no coverage for what's inside it.
Most people in the Fargo area near the river have no flood coverage at all. From what they hear, the Falkners don't know if their home will be inhabitable again.
L. FALKNER: Got to tell you, Mike has just been a rock.
M. FALKNER: Well, it's been tough on both of us, but it'll be OK. It's North Dakota. We all come back. We don't wait. We can take care of ourselves.
L. FALKNER: Might be in a different form when we come back, but we'll still be here.
M. FALKNER: We'll make it through. It's no big deal. We're going to -- we'll make it through. Thank you. Thanks a lot.
TUCHMAN: To the people who live here, Briarwood is far more than a typical town.
MIKE: It's peaceful. It's a great community. The kids are safe out here. And it's just our own little piece of heaven. TUCHMAN: And that's one of the reasons families like the Falkners are going through a private hell.
Gary Tuckman, CNN, Briarwood, North Dakota.
(END VIDEOTAPE)
COLLINS: Tick, tick, tick. Is that a time bomb counting down on your computer? We'll tell you about the latest threat due to hit just a few hours from now.
(COMMERCIAL BREAK)
COLLINS: At this very minute, a time bomb may be ticking on your computer. The conficker worm may be lurking on millions of computers, just awaiting tomorrow's orders to strike. So, what do you need to do right now? CNN's Errol Barnett has the answers.
(BEGIN VIDEOTAPE)
ERROL BARNETT, CNN INTERNATIONAL IREPORT CORRESPONDENT (on camera): Right now, the conficker worm is moving through servers like these around the world. It has the best anti-worm researchers scrambling to figure out what to do, and the clock is ticking.
It first surfaced last october, targeting computers using Microsoft's Windows software. Since then, it's spread, evolved and become such a threat, Microsoft is offering $250,000 to anyone who can stop it. Analysts say it's programmed to become active on April 1st, and according to their research, here's how conficker works.
(voice-over): First, the worm, which is a complex computer program, is created and sent out through the Internet. Landing in servers, it then searches for computers on the network to hack into. It preys on computers with weak network passwords, old anti-virus software or Windows software not recently updated.
(on camera): Once inside, it creates a so-called zombie computer that can be controlled by the worm's designer. One person who's been following this worm since it was created is Rick Ferguson. He's the senior security adviser at Trend Micro. He joins me now via webcam from England.
Rick, once this worm gets into your computer, what can it do?
RICK FERGUSON, SENIOR SECURITY ADVISER, TREND MICRO: Well, in terms of what it's going to do on April the 1st, it's really anybody's guess. The worst case is that the outside estimates of the numbers of affected machines are true, and that's multiple millions.
And we could, for example, drown under a deluge of spam. We could have alongside that spam, a vast number of previously unknown machines that are now infected, hosting malicious software which will create a vicious circle of more people getting infected.
BARNETT: Now, this is specifically targeting Microsoft users. Microsoft is telling its users to head to search.live.com. I have that pulled up here, where it says you can get a free P.C. safety scan. But if my computer's infected, I might have a problem getting to this site, correct?
FERGUSON: That's right. One of the things that the latest variant of this worm does is it blocks access to a large number of security-related and cleanup-related Web sites, one of those being safety.live.com.
BARNETT: And being that it comes out on April 1st, any possibility that this is some sort of hacker's hoax?
FERGUSON: No. The people behind this software are very skilled programmers, and they're very well-informed. We've seen them incorporate updates using the latest encryption technology, literally as it was released, within this worm. So, these are very skilled cyber criminals.
BARNETT: All right, Rick Ferguson, a senior security adviser at Trend Micro, appreciate your time. Thanks for talking to me via webcam.
FERGUSON: Thank you.
BARNETT: We can keep an eye on the conficker worm, expected to activate on April 1st. From the CNN center, I'm Errol Barnett.
(END VIDEOTAPE)
COLLINS: And I'm Heidi Collins. Join us again tomorrow morning beginning at 9:00 a.m. Eastern. For now, CNN NEWSROOM continues with Tony Harris.
