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GM Now Leaner After Exiting Bankruptcy; Protesters Back in Tehran; Taking on the Taliban; Sotomayor's Senate Challenge; AIG Owes $235 Million in Bonuses

Aired July 10, 2009 - 12:00   ET

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

TONY HARRIS, CNN ANCHOR: GM is officially reborn today. The troubled automaker now leaner after exiting bankruptcy in just six weeks.

Under the terms, the company sheds tens of billions in debt and retains four brands: Chevy, Cadillac, GMC and Buick. What's troubling to many is the government now owns 61 percent of the new GM.

CEO Fritz Henderson vows to make the company great again.

(BEGIN VIDEO CLIP)

FRITZ HENDERSON, CEO, GENERAL MOTORS: We deeply appreciate the support we've received during this historic transformation, and we'll work hard to repay the trust and the money that so many have invested in GM.

The last 100 days has shown everyone, including ourselves, that a company not known for quick action can, in fact, and indeed move very fast. Starting today, we want to take that intensity, the decisiveness, and the speed of these last several weeks and then transfer it from the battlefield triage of the bankruptcy process to the day-to-day operation of the new company. And this will be the new norm at General Motors.

(END VIDEO CLIP)

HARRIS: So, now that GM is out of bankruptcy, the hard work really begins. Can the automaker really reinvent itself?

CNNMoney.com's Poppy Harlow has the breakdown from New York for us.

Good to see you, Poppy.

POPPY HARLOW, CNNMONEY.COM: Good to see you, Tony.

What a day for the U.S. auto industry. A rebirth of sorts for General Motors. And Fritz Henderson, the CEO, still thinks they can rebuild themselves.

Here's how they're going to do it. Let's break it down.

First of all, they are going to be much smaller than they once were. They are shedding dealerships. The goal, to cut dealerships down to about 3,600 to 6,000, where it stands today. They are closing 16 plants across the country. That means they're going to cut about 20,000 U.S. workers. That's from the remaining 88,000. And they're also going to cut about 450 white-collar employees from the management there at GM.

They're also going to be a company with a lot less debt thanks to bankruptcy. And we, the U.S. taxpayer, are supporting GM to the tune of $50 billion for them to restructure. And also, they're really going to try to offer more attractive products.

Fritz Henderson, the CEO, saying this morning they're going to launch 10 new vehicles in the U.S. And Tony, 17 new vehicles around the world over just the next 18 months. And his goal here, three priorities, the CEO outlined this morning -- customers, cars and culture. Promising to improve, Tony, that experience you have when you head to a GM dealership, trying to improve customer service. They'll go from the ground up.

HARRIS: Yes, I need that. I need a better experience, Poppy.

All right. Will this new GM be able to turn things around? What are you hearing?

HARLOW: It is so to be seen...

HARRIS: Yes.

HARLOW: ... and it all depends on this -- can they sell more cars?

What we want to show you here is their market share, which has been steadily declining for decades and decades. It now stands below 20 percent here in the U.S.

This is a company that once held half of the U.S. auto market. GM does outsell Toyota here in the U.S., but not around the world. Toyota took that largest automaker in the world, that title, away from GM last year.

And we have heard President Obama's head of the auto task force, Steve Rattner, say this week, Tony, a company can't be truly viable if it continues to lose market share. So, GM needs to really defy the odds here.

HARRIS: But you know what? Am I correct here, that GM sells cars like crazy overseas, particularly in China? Isn't that true?

HARLOW: Yes.

HARRIS: Isn't that true? All right. So -- is that true?

HARLOW: It's true, the Chinese love their...

(CROSSTALK)

HARRIS: Yes. Well, how will the -- I've been asking this question all day -- how will the new GM be different from the old one? HARLOW: It's a great point. And one of my colleagues, Chris Isadore (ph), brought this up to me.

He said, "Listen, bankruptcy doesn't change culture." So GM may be going through a process, but how is it changing the culture?

They say they are going to do it by emphasizing that customer experience. Fritz Henderson, the CEO, is launching a Web site, "Tell Fritz." He wants people to e-mail him their complaints...

HARRIS: Oh lord.

HARLOW: ... their ideas. He's going to answer them.

He's hitting the road, Tony. He's going out to talk to customers, to take their questions. And we're going to ask him a few questions this afternoon. We have some time with him, one-on-one, here in New York, about 2:00 Eastern. We'll bring it to you when that whole interview -- you'll only see the whole thing on CNNMoney.com -- Tony.

HARRIS: Poppy, appreciate it. Thank you.

Will GM's new plan result in profits?

Now, last hour, I put that question to automotive analyst Lauren Fix and "Wall Street Journal" Detroit bureau chief Neil Boudette.

Here's their take on profit potential.

(BEGIN VIDEOTAPE)

NEAL BOUDETTE, DETROIT BUREAU CHIEF, "WALL STREET JOURNAL": At this level, where the market is now, we're selling at a rate of about 10 million cars a year. Really nobody in the United States is making money. So, no, that is not going to do it.

What GM will need to make money is for the economy to come back and for the auto market to get from 10 million up to closer to 12, 13 and maybe even above 13 million to start making money. But Henderson is talking about a cultural change. That is a very, very important move for the company.

HARRIS: Yes. What's his argument? What's that cultural change that he was talking about this morning?

BOUDETTE: Well, you know, if you go back to the '50s and '60s, GM was a really hot company. They were the largest company in the world. At one time, were the most profitable. And people looked at GM the way people look at Toyota or Microsoft or Google today, and they were risk takers.

Remember, this is the company that invented tail fins and came up with the small block V8. They took a lot of chances. Henderson wants to get back to that. In the last 10 years or so, GM became a very conservative, very risk-averse company. He wants them to be more daring in the way they run the company. HARRIS: And Lauren, weigh in here. What did you hear this morning? Anything encouraging from Fritz Henderson? And how soon -- did he articulate a plan to you that will lead the company back to profitability?

LAUREN FIX, CONTRIBUTING EDITOR, "MOTOR TREND": Well, I think it's going to be a big challenge. You're looking at $48 billion in debt which they claim they want to pay back in the next few years. That's a lot of money.

They're talking about 10 new models to be coming out in the U.S., and 17 additional will be worldwide. So, there should be some additional product.

I'm curious what the product is going to be. I'm really concerned about the government being involved, even though they claim they're not going to be involved.

I mean, they are saying green cars and we're going to have better fuel economy, but the cost of gas continues to drop, jobs are being cut. There's another 4,000 jobs, salaried jobs, that are going to be cut at General Motors. You start adding that up and then it gets to be a lot. I mean, these are things that, consumers won't buy cars if they don't have money.

(END VIDEOTAPE)

HARRIS: It makes sense to me.

All right. President Obama is heading to Africa. He is going to Ghana.

The president left the Vatican a short time ago. He met with Pope Benedict for about 30 minutes.

We're told Mrs. Obama and the girls also met the pope. We won't see pictures of it, but the pontiff blessed the first family during their visit.

Of course you know President Obama was in Italy for the G8 summit, which wrapped up today. He says, among other things, world leaders agreed that they're making progress on getting the world through the current financial mess.

(BEGIN VIDEO CLIP)

BARACK H. OBAMA, PRESIDENT OF THE UNITED STATES: There was widespread consensus that we must all continue our work to restore economic growth and reform our national and international financial regulatory systems. I'm pleased that the United States has taken the lead on this reform at home, with a sweeping overhaul of our regulatory system, a transformation on a scale that we have not seen since the aftermath of the Great Depression.

(END VIDEO CLIP) HARRIS: Anderson Cooper is with President Obama on historic trip to Africa, Monday night at 10:00 p.m. Eastern. Don't miss the "AC 360" special report as Anderson shares his exclusive access to the president on his journey to Africa. That is Monday night, 10:00 Eastern, only here on CNN.

Derivatives, derivatives -- just trying to describe what it is can give you a bit of a headache headache.

This morning, Treasury Secretary Tim Geithner was before a House committee trying to rein in the over-the-counter derivative market.

(BEGIN VIDEO CLIP)

TIMOTHY GEITHNER, TREASURY SECRETARY: Any regulatory reform of this magnitude requires deciding how to strike the right balance between financial innovation and efficiency on the one hand, and stability and protection on the other. And we failed to get this balance right in the past, and if we do not achieve sufficient reform, we will leave ourselves weaker as a nation, weaker as an economy, and more vulnerable to future crises.

(END VIDEO CLIP)

HARRIS: Blamed derivatives for getting us into this financial mess.

So, what is it? A derivative is essentially a financial contract that's derived from an asset, something like a stock option offered by a company.

The treasury secretary sat down with CNN's Fareed Zakaria to talk about the nation's financial situation. Fareed asked him about the Federal Reserve's role in the crisis.

(BEGIN VIDEO CLIP)

FAREED ZAKARIA, HOST, "FAREED ZAKARIA GPS": We need a good Fed chairman. Do you have any ideas?

GEITHNER: We have an excellent Fed chairman now, and he's doing a terrific job. And I think that this is important to underscore.

I think what the Fed did in this crisis, which was without precedent, subject of enormous controversy, important for people to look back over time and, you know, evaluate those judgments. But I think what the Fed during this period was absolutely essential and helped stave off a much more catastrophic outcome. And I think what the Fed did was not just essential, but extraordinarily helpful in helping contain the risk, help slow the -- reduce the risk of a more catastrophic...

ZAKARIA: That sounds like a vote for the reappointment of Ben Bernanke.

GEITHNER: Well, again, like I said, I think the chairman has done an exceptional job, and I think he deserves a lot of confidence.

(END VIDEO CLIP)

HARRIS: Timothy Geithner sits down with Fareed Zakaria this weekend, and you can hear what the treasury secretary has to say about frustrations surrounding the stimulus package. That is Sunday at 1:00 p.m. Eastern Time.

The insurance giant -- got to get to this story -- that got $180 billion of your tax dollars is reportedly preparing to pay its top execs millions more in bonuses. It has been, what, four months since AIG paid out multimillion-dollar bonuses, sparking widespread outrage? So, this time, "The Washington Post" says AIG wants to protect itself by getting approval from the government. AIG doesn't really need that approval because the bonuses are linked to contracts from last year, before it received bailout money.

What do you think about a company living on taxpayers' dollars and handing out executive bonuses? Is that a loaded enough question for you? That is the question of the day at my blog, CNNNewsroom/Tony.

Go to that page, CNN.com/Tony, and have your say. We will try to get a few of your comments on later in the hour.

More unrest in Iran with smaller but seemingly angrier groups of protesters defying authorities.

For the latest, let's go to CNN's Iran Desk and our Reza Sayah.

And Reza, I understand we may have some new pictures of the protests?

REZA SAYAH, CNN CORRESPONDENT: Yes, we do, Tony.

This was the first protest we've seen in about 11 days. Nowhere near the numbers of what we've seen in previous weeks, but these people were determined and aggressive, and they came out. Let's show you some pictures and video that's been coming to the Iran Desk this morning and during the overnight hours.

About 3,000 people, that's how many people turned up in Revolution Square, according to our eyewitnesses. Many of them women, as you can see there in Revolution Square.

They were met with security forces carrying batons. Security forces were successful in getting them out of Revolution Square, but these protesters didn't quit. According to our eyewitnesses in pictures, they moved on to surrounding neighborhoods. And let's go ahead and show you some video of those surrounding neighborhoods where protesters went to.

Some very poignant and aggressive chants. First of all, what you're hearing right now is (SPEAKING ARABIC), and that's a chant that we've been hearing over and over again.

It's scary out there, going into these streets, going head-on with these security forces. So that chant translated is, "Don't be scared. Don't be scared. We're all together." Also we heard chants of "Death to Ayatollah Khamenei!" the supreme leader. There you see some tear gas being administered by security forces. Those who didn't disperse were beat up by security forces.

Now, we warn you, this picture coming up is graphic, may be graphic to some, so turn away if you are disturbed by scenes like this.

This is a man that we spoke with this morning. He said he went to protect, went to rescue a few women that he said were being beat up, and this is what happened to him. He said security forces came up with batons and gave him a few shots in the back and in the head.

And again, he said he was watching some women being beat up. He went to their rescue. So, a lot of people like this man paid for the fact that they went out there.

These were, safe to say, the hardcore, some say the courageous elements of the opposition groups that went out there. Nowhere near the numbers that we've seen in the past, but these people wanted to go out and show the government that this thing is not over.

But it's important to note the government has said all along, it is over, do not come out. These election results will not be annulled, leaving the opposition leaders with very little legal recourse -- Tony.

HARRIS: Reza, can you explain -- I have been amazed at the role women have played in the post-election demonstrations and what you're describing today. Explain to me, what should we know about the role women play in that society and the role they have taken, the courage they have shown...

SAYAH: Yes.

HARRIS: ... in these weeks of protests and demonstrations?

SAYAH: What you should know is many of them have led this movement.

HARRIS: Wow.

SAYAH: They've been absolutely determined.

HARRIS: Yes. Yes.

SAYAH: And really remarkable to watch.

When I was there, and during some of these protests, when these security forces rushed some of these groups, it's the women who stayed. It's the women who didn't run away. And many are giving the women credit for keeping these movements going. As you saw in this video, there's a lot of women out there.

HARRIS: That's right.

SAYAH: And some of them are paying the price. These security forces are beating up women with these batons. They're not holding back. And some of them continue to come back for more and more.

Now, it remains to be seen when the next protest is going to be. A lot of people are pointing to Mahmoud Ahmadinejad, the re-elected president, swearing-in ceremony that could happen in late July or sometime in early August. Many are saying look for that occasion to be the next time the protesters will take to the streets. And you can be sure, if these past four weeks have been any indication, that more women will be on the vanguard of any protests that are to come -- Tony.

HARRIS: Reza, good stuff.

Reza Sayah for you at our Iran Desk.

Reza, appreciate it. Thank you.

Is Pakistan ready to do more in the U.S. fight against the Taliban? We have a report from the region you'll see only on CNN.

(COMMERCIAL BREAK)

HARRIS: Authorities in suburban Chicago are finding more graves dug up at that historic African-American cemetery, and word this morning they found Emmett Till's original casket in a garage at the cemetery. Till's death 50 years ago helped spark the civil rights movement. The sheriff says people are coming in droves to check on the remains of their loved ones.

(BEGIN VIDEO CLIP)

SHERIFF TOM DART, COOK COUNTY, ILLINOIS: With the over 2,000 families that we've had so far, we've had at least 30 or so cases already that have newly come to us, where another crime scene has been -- is obvious now, and it's apparent. People have gone to gravesites where the headstones are gone, people have gone to a gravesite where a different person is there now. People have gone to gravesites where it's clear that something has been removed.

(END VIDEO CLIP)

HARRIS: Four people, an office worker and three grave diggers, are accused of digging up the graves and disposing of the corpses so the plots could be resold.

A moderate earthquake has caused extensive damage in southwest China. One person is dead, hundreds more are injured in Yunnan Province.

Thursday's magnitude 6.0 quake destroyed more than 18,000 homes. State media reports another 75,000 home damaged. Tent cities are being built to handle some of the 400,000 people who have evacuated that area.

President Obama has staked much on winning the war in Afghanistan. Now he may have an opportunity for a breakthrough that could help end the conflict.

CNN's Michael Ware files this exclusive report from the Afghan border with Pakistan.

(BEGIN VIDEOTAPE)

MICHAEL WARE, CNN CORRESPONDENT (voice-over): I came to these mountains to unravel how the Taliban in Afghanistan are based from here across the border in Pakistan.

In these remote mountain valleys of Pakistan's Northwest Frontier Province, the Taliban can hide, train, smuggle weapons, and launch military strikes against U.S. forces in Afghanistan.

For generations, the border here has been little more than a vague blur among the peaks. And that is what is crippling the American effort in Afghanistan.

(on camera): To put it simply, America cannot win the war in Afghanistan. It certainly can't win it with bombs and bullets, and it can't win it in Afghanistan alone. But part of the answer lies here, where I'm standing, in these mountain valleys in Pakistan on the Afghan border, because this is al Qaeda and Taliban territory.

Right now, there's as many as 100 Taliban on that mountaintop between the snowcapped peaks and amid those trees. They're currently under siege from local villages, who are driving them from their bunkers. But, at the end of the day, it's the Pakistani military who tolerates the presence of groups like the Taliban.

And it's not until America can start cutting deals with these people that there's any hope of the attacks on American troops coming to an end.

(voice-over): The key leader the U.S. may have to deal with is this man, Mullah Mohammed Omar, the one-eyed cleric who actually created the Taliban and led its regime, the man who, after the 9/11 attacks, sheltered Osama bin Laden, choosing war with the U.S., rather than surrender bin Laden.

Even with a $10 million reward on his head, Mullah Omar has defied all American attempts to capture or kill him. He still commands the Afghan Taliban as they continue killing U.S. and NATO troops. He and other top commanders do all of this, according to U.S. intelligence, from sanctuaries here in Pakistan.

It was the Pakistan military who helped create the Taliban. When the CIA was funding many of these same Afghan groups in the 1980s in their war against the Soviets, it was the Pakistan military that delivered the money, expertise and weapons, like Stinger missiles.

Now, for the first time, in this CNN interview, the Pakistan military concedes it still maintains contact with the Taliban. At the military headquarters, we met Major General Athar Abbas, who concedes, the army's links with the Taliban were toned down after 9/11, but:

MAJOR GENERAL ATHAR ABBAS, PAKISTANI ARMY SPOKESMAN: But, having said that, no intelligence organization in the world shuts its last door on any other organization. WARE: And, more than talking to the Taliban, the general says the Pakistan military can actually get the Taliban to sit down with the United States and broker a cease-fire.

(on camera): And that's where Pakistan can perhaps provide valuable assistance to the American mission?

ABBAS: I think, yes, that can be worked out. That's possible.

WARE (voice-over): And this is one of the men who says he can help work that deal.

GENERAL HAMID GUL (RET.), FORMER ISI DIRECTOR GENERAL: People like me, who serve the cause of the freedom of Afghanistan.

WARE: Former CIA ally General Hamid Gul, once the head of Pakistan's equivalent of the CIA, known as the ISI, he is famed as the godfather of the Taliban.

GUL: The guarantees can be given, no problem.

WARE (on camera): How? In terms of American national interests, who does America need to dialogue with?

GUL: Mullah Omar, nobody else.

WARE (voice-over): Mullah Omar, the most important Taliban leader.

But to get him and the other Taliban to the table, Pakistan wants something in return. It wants the United States to use its influence to rein in Pakistan's number-one military rival, India.

(on camera): India's close association with the U.S.-backed government in Afghanistan worries the Pakistanis, and the Pakistanis accuse India of supporting arms separatists in one of Pakistan's provinces. And senior U.S. officials tell CNN the Obama administration is willing to raise those concerns with India, and the U.S. is willing to talk with Mullah Omar and other Taliban commanders.

Michael Ware, CNN.

(END VIDEOTAPE)

HARRIS: That's amazing.

OK. We will take you along with the U.S. military as they try to push out the Taliban and create stability in southern Afghanistan, and find out what impact all this is having on those who live there.

(COMMERCIAL BREAK)

HARRIS: It has been called the forgotten war. Now the U.S. is shifting its focus and much of its military might to battling militants in Afghanistan.

CNN's Atia Abawi is on the ground with the latest coalition offensive in Helmand Province.

(BEGIN VIDEOTAPE)

ATIA ABAWI, CNN CORRESPONDENT (voice-over): Flying with the U.S. Marines into an area of Helmand Province that was once considered Taliban land. Just five days after Operation Strike of the Sword began, the governor of Helmand stepped into a district that he could not before because it was too dangerous.

Raising the Afghan flag over Hanashin (ph) District, a symbol of new governance and change. It was a moment that was likened to Iwo Jima by Marine Brigadier General Larry Nicholson, a moment that they hope will symbolize a turn in the war here.

(on camera): This castle was built in the 1700s during the time of King Durrani, the father of Afghanistan. For the past several years, this castle in this district was occupied by the Taliban. But today, the U.S. Marines and the coalition forces gave it back to the government and the people of Helmand Province.

(voice-over): For the past three years, Hanashin (ph) was under strict Taliban control. Now, this district of around 2,000 waits to see what its future holds. Some hopeful, but many skeptical. They have seen this all before -- coalition forces coming in and quickly leaving, and the Taliban always making their way back. But this time, the troops and the government promise to stay and build institutions, and most importantly, trust.

GOV. GULAB MANGAL, HELMAND PROVINCE, AFGHANISTAN (through translator): I tried to reassure the people that until our own Afghan forces can stand on their own two feet, the international forces will help us.

ABAWI: Although the people believe the governor is a kind man, this village elder points the finger at him, still distrustful of the intentions of the Afghan government.

Villagers in Helmand, like the ones here, have in the past turned to the Taliban for protection, feeling at times it was their only choice. But the forces hope to show these men that there is an alternative to their current, less-than-rudimentary existence.

BRIG. GEN. MAYAHADEEN GHORI (through translator): You can see with your own camera what terrorism is and what al Qaeda is. You can see a deficient school, a deficient clinic, a deficient district, deficient roads. People don't have the matter or means of living.

ABAWI: And although troops haven't met much resistance yet, General Nicholson warns this is only a week into the operation. And like the villagers, the Taliban have their own expectations.

BRIG. GEN. LARRY NICHOLSON, U.S. MARINES: So perhaps the Taliban is also expecting us to leave. And I think once they understand that we're not leaving, I think in some cases they will -- they will test us. They will come back at us, and they will try to get back to the population.

ABAWI: And it's the population who will have to choose, a decision that will determine the country's future.

(END VIDEOTAPE)

HARRIS: CNN's Atia Abawi reporting.

Senators put the judge on the spot. Will they put her on the bench? We're back in just a moment.

(COMMERCIAL BREAK)

HARRIS: So, we love the site, we love the page and the work our people do there. Check out cnnmoney.com for the latest financial news and analysis. Our "Money" team is the best in the business. We're talking about Gerri Willis, Jeanne Sahadi, Poppy Harlow, Christine Romans, our senior business correspondent, Ali Velshi. Again, for the latest financial news, expert analysis, cnnmoney.com.

Let's swing you to the New York Stock Exchange for a look at how stocks are trading today, just past three hours into the trading day. You can see stocks are in negative territory. I'm not sure if these are new lows or if we're off session lows, but the Dow is down 68 points. The Nasdaq is down 5. We are following these numbers throughout the day for you with Stephanie Elam right here in the CNN NEWSROOM.

Tightening California's financial squeeze. Today, several big banks say they will stop accepting the state's IOUs. That adds pressure on lawmakers to close the state's $26 billion budget gap. They failed to agree on ways to fix the budget last week and began handing out the IOUs to creditors. The state's controller says without the IOUs, California would run out of cash by month's end.

Confirmation hearings start Monday morning for Supreme Court Nominee Sonia Sotomayor. You will see live coverage and analysis when you watch CNN and the best political team on television. That's a given.

Before Monday rolls around, we thought it would be a good idea to reintroduce the judge. Here's senior political correspondent Candy Crowley.

(BEGIN VIDEOTAPE)

CANDY CROWLEY, CNN CORRESPONDENT (voice-over): The first Hispanic Supreme Court nominee, tapped by the first African-American president, history picks history.

JUDGE SONIA SOTOMAYOR, SUPREME COURT NOMINEE: That I am an ordinary person who has been blessed with extraordinary opportunities and experiences.

CROWLEY: Sonia Sotomayor's experience began in a housing project in the south Bronx, where dreams can be big, but possibilities can seem small.

UNIDENTIFIED MALE: To find out that, you know, somebody has actually made it out here, is exciting. CROWLEY: She was a first generation American. The daughter of Puerto Rican immigrants. A father with a third grade education who worked in a factory. A mother who worked as a nurse. Sotomayor read "Nancy Drew" and wanted to be a homicide detective, but she was diagnosed with diabetes when she was eight and told that meant she could not be a cop. A year after the diagnosis, her father died. Left alone to raise two children, Sotomayor's mother worked six days a week.

SOTOMAYOR: I have often said that I am all I am because of her.

CROWLEY: If police work was out, she found an alternative, watching "Perry Mason."

PERRY MASON: I'm sorry, your honor, I have no further questions.

CROWLEY: Sonia Sotomayor wanted to be a lawyer. She excelled in school, valedictorian in high school. On a scholarship to Princeton, she graduated summa cum laude and phi beta capa. And then Yale Law, followed by a fearsome career.

Prosecutor, corporate litigator, appointed by President George H.W. Bush to the U.S. District Court in New York. It's youngest member. Then, in 1998, the first Latina appointed to the U.S. court of appeals for the second circuit. Jenny Rivera is a former law clerk.

JENNY RIVERA, FORMER LAW CLERK: She had very high expectations of herself and everyone around her, but she is very caring. She's funny.

CROWLEY: Sotomayor often stops by her local bakery for sturgeon toast, bread sticks and a cup of decaf. Neighbors say they talk with her about the building's leaky roof and she's big on holidays.

UNIDENTIFIED MALE: She does make quite an effort at Halloween and puts us all to shame at Christmas with her lights on the balcony.

SOTOMAYOR: Thank you again, sir.

CROWLEY: It's a long way from the projects of the south Bronx to the East Room of the White House, but not quite as long as it seemed yesterday.

Candy Crowley, CNN, Washington.

(END VIDEOTAPE)

HARRIS: And Candy's profile first aired on CNN May 26th, the day President Obama announced his nominee.

Now that Americans know a little bit more about Judge Sotomayor, almost half say she should be confirmed for the Supreme Court, 40 percent say no, 13 percent are still unsure. Those findings in a new poll by CNN and Opinion Research Corporation. CNN deputy political director, Paul Steinhauser -- where is Paul? There he is. Is in Washington for us.

Always good to see you, doctor. PAUL STEINHAUSER, CNN CORRESPONDENT: Hey, Tony.

HARRIS: Let's blast through a couple of points here. Factor in party affiliation for us. What does that tell us about the public's view about the judge in this poll?

STEINHAUSER: Yes, our poll, Tony, definitely shows there's a partisan divide. Take a look at these numbers. This is a national poll, of course. And you can see, Democrats, almost seven out of 10 Democrats, yes, they feel Sotomayor should be confirmed.

Independents, Tony, look at that. They're kind of divided. They're split.

Republicans, Tony, only one in four thinks she should be confirmed. Take a look at the 65 percent number in the lower right. Those are the number of Republicans in our poll who suggest she should not be confirmed.

Our polling director, Tony, Keating Holland (ph), he tells us that that number is higher than the number of Republicans who opposed Ruth Bader Ginsburg back in the '90s, or the number of Democrats who opposed Alito and Roberts just four years ago.

HARRIS: Wow. It's amazing that Democrats and Republicans seemingly are looking at two different nominees.

STEINHAUSER: Oh, yes.

HARRIS: Yes. Yes. A lot of controversy about Sotomayor's stands on the issues. What are people saying?

STEINHAUSER: This is very interesting as well. Check out this number. We asked if her qualifications are OK. If she's qualified. And, senators, should they vote against her because of her stand on the issues. And as you mentioned, you know, affirmative action, gun rights, controversial issues when it comes to this nominee. Well, you can see, Americans are divided here. And that is a change. Back in the old days, back in the day, Tony, if a judge was qualified, senators would most likely vote for that judge. Nowadays, it's much more partisan, Tony.

HARRIS: Wow. Is there -- I don't know, can we get along on anything? Can we agree on anything? Is there anything in the polls that people actually agree on here, Paul?

STEINHAUSER: There is something, though it may not be a big thing. Take a look at this number. Six in 10 think that next week's confirmation hearings is going to be a food fight, a major fight, they say, between the parties. Only about four in 10, just a little less, think that there will be a bipartisan agreement, think there will be a kumbaya moment.

HARRIS: Yes, Paul Steinhauser. Paul, good to see you. Thank you.

STEINHAUSER: Thank you. HARRIS: All right. And CNN plans live coverage, of course, as the Senate considers Sonia Sotomayor for the United States Supreme Court. CNN's Wolf Blitzer and the best political team on television bring you analysis you won't find on any other network.

So, what are you saying -- what are you saying about AIG's plan to pay bonuses again? Boy, you are lighting up the blog. We're checking in just a moment.

(COMMERCIAL BREAK)

HARRIS: All right. Time to check the buzz on the blog. We asked for your opinion about paying for health care. That was yesterday. Andreas (ph) there on your left, Sumi (ph) on your right, moderating, handling all the blog activity. And, boy, you are -- this blog stuff is -- look, it's coming along. It's pretty good!

That was yesterday we asked you about health care, how to pay for it and what the obstacles are to health care reform in the country. Here's what Joshua Eckert had to say. "How do we tax the l w-income people for health care by stereotyping them as smokers and drinkers and then saying they would benefit more from the health care reform so they should pay more?"

Here's another caller's answer for reforming the nation's health care system. This from yesterday. (BEGIN VIDEO CLIP)

CALLER: We, as a family, pay about $1,000 a month to an insurance company. If we put that money to a government health care, $1,000 a month, would go a long way instead of it going towards the profits.

(END VIDEO CLIP)

HARRIS: OK. And today we asked your opinion about AIG planning to pay $2.4 million in executive bonuses next week. Jerry writes, "I always thought bonuses were paid for a job well done, not for breaking the company. What is AIG thinking?"

Ouch! Jerry, that was a good one.

And from Anne, "they just don't get it. The jobless numbers are going up. Do they really believe that there are not capable people who can take their places. Of the millions of unemployed, not all are blue- collar workers."

As always, boy, this has been good. Over 300, 400 responses yesterday to our health care reform question. Over 150 or so, so far today on our AIG question and counting. Send us your thoughts, cnn.com/tony. And if you'd like to -- if you can't get near your computer and you'd like to call us and talk to us, maybe you're listening to us on the radio in your car, well, I don't want you to do that either. But if you'd like to call us, 1-877-742-5760.

Let's go to Chad Myers before I get myself in trouble here.

Chad, I'm going to have you stop.

(WEATHER REPORT)

HARRIS: The NAACP celebrating its 100th anniversary. What does the group's president have to say about the past century and the next?

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HARRIS: And turning now to our "What Matters" segment, in partnership with "Essence" magazine. We start with a controversial story featured in the August issue hitting newsstands today. A report leaked on the Internet by a special police intelligence unit singles out black and Christian colleges in Virginia as breeding grounds for terrorism. Police say the report was meant to help them identify potential threats and could be misinterpreted by outsiders. Virginia Governor Tim Kaine says the report is, "misleading" and "improperly implicates these fine academic institutions." Kaine launched an investigation and should have results by mid August.

When it comes to retirement, too many minorities are headed for trouble. A study out this week shows black and Hispanic workers save far less in their 401(k)s than whites and Asians. They are also more likely to borrow from their plans. At 50 large companies surveyed, two-thirds of black and Hispanic employees had a 401(k), compared to three-fourths of whites and Asians. The study warns, unless changes are made, some minority groups could retire into poverty.

The NAACP is celebrating its 100-year anniversary. The civil rights organization kicks off its centennial convention tomorrow in New York. NAACP President Ben Jealous recently spoke with CNN's Don Lemon, saying he recognizes the progress African-Americans have made, but there's still a long way to go.

(BEGIN VIDEO CLIP)

BEN JEALOUS, NAACP PRESIDENT: Well, it's a time to dream bold dreams again. And 100 years ago, our big, bold dream was to end lynch-mob justice, followed quickly by a dream to end segregation and Jim Crow. At this point we have to take stock of exactly where we are. And you look at the fact that, you know, our generation, our generation was told, you know, you're the children of the dream. We've ended segregation. Just work hard and you'll get rich and everything will work out just fine.

And we come of age just in time to find ourselves the most murdered generation of the country and the most incarcerated generation on the planet. And so our dreams at this moment have to be based on that reality.

We have to focus on the high rate of black children not finishing high school and not coming out of high school prepared for college. We have to focus on the high rate of black unemployment and within that the lack of quality employment. The fact that, you know, on the one hand we have children who are neglected because the parents don't have a job. And on the other hand, we have children who are neglected because the parents have to have too many jobs, right? And we have to deal with, you know, the high incarceration rate and the culture of violence within our communities.

(END VIDEO CLIP)

HARRIS: Keynote speakers at the six-day event include President Obama, New York City Mayor Michael Bloomberg and former Secretary of State Colin Powell.

You know, no matter how careful you are, a scammer may be able to figure out our Social Security Number in just a few quick steps. Find out how.

(COMMERCIAL BREAK)

HARRIS: You know, Social Security is meant to protect the economic security of workers, retirees and their families. But the way card numbers are assigned, it may be put your identity at risk. Here's CNN's Brian Todd.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice-over): A 36-year-old professor from Italy opens a new battlefront against identity theft, by exposing the predictability of how we currently get assigned our Social Security Numbers. Alessandro Acquisti of Carnegie Mellon University says all he needs to get started in finding your Social Security Number is your date of birth and the state where you were born. Information that millions of Americans freely give out by registering to vote or putting it on their FaceBook or MySpace pages.

TODD (on camera): We're going to try to at least get in the ballpark of my Social Security Number. I was born in Virginia and, OK, guys, bleep out the date here, October (BLEEP) 19 (BLEEP). So, OK, how would you kind of at least come upon the first couple of digits, first maybe three, four or five digits.

ALESSANDRO ACQUISTI, CARNEGIE MELLON UNIVERSITY: So we will know from publicly available information that your SSN should be likely between -- the first two digits, 223 and 231.

TODD: That's right.

ACQUISTI: Is that the case.

TODD: That's right.

TODD (voice-over): Those are the area numbers assigned based on the state where you were born. The last six numbers are given in chronological order. To find them, Acquisti and his team of researchers used statistical techniques and they mined publicly available data from the Social Security Administration's death master file. That shows the patterns in which people who are deceased got their numbers. Acquisti says it's much easier to narrow down numbers for people born after 1988, when most Americans started getting assigned Social Security numbers at birth.

ACQUISTI: If you consider the entire nine digits, we can predict with fewer than 1,000 attempts, 85.5 percent of all SSN issued after 1988.

TODD: And it's even easier to track people born in less populated states. His point in all this?

ACQUISTI: The bottom line is that Social Security Numbers are very bad passwords. They were not designed to be used the way they are using them now.

TODD: So Acquisti and the Social Security Administration have been cautioning people to stop using them as passwords at the bank and other places. Officials from the Social Security Administration didn't respond to our request for an on-camera interview, but in a statement a spokesman said, "the suggestion that Mr. Acquisti has cracked a code for predicting an SNN is a dramatic exaggeration."

TODD (on camera): But the spokesman says for reasons unrelated to Professor Acquisti's report, they'll start randomly assigning Social Security Numbers next year.

Brian Todd, CNN, Washington.

(END VIDEOTAPE)

HARRIS: It is go time. We are pushing forward with the next hour of CNN NEWSROOM with the man, Ali Velshi.