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President Obama's Supermarket Sales Pitch; Town Hall on Health Reform; Senate Negotiating Compromise

Aired July 29, 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: Developments unfolding in two major stories this hour, and we're following both here in the CNN NEWSROOM.

President Obama makes his latest pitch for health care reform. We are awaiting his town hall meeting in Raleigh, North Carolina, and we will bring that to you live, of course.

And we are also waiting to hear from the 911 caller in the arrest of Harvard Professor Henry Louis Gates. Lucia Whalen holding a news conference in Cambridge, Massachusetts.

First, President Obama trying to keep the pressure on Congress and rally public support for health care reform. After his town hall meeting in Raleigh, he makes a pitch to supermarket employees in Bristol, Virginia.

Senior White House Correspondent Ed Henry with a preview.

(BEGIN VIDEOTAPE)

ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT (voice-over): They're rolling out the red carpet in rural Virginia, but the president could get a chilly reception in the frozen food aisle, where we found clerk Phil Younce, a McCain voter who fears health reform is being rushed just like the stimulus.

PHIL YOUNCE, FROZEN FOOD CLERK, KROGER SUPERMARKET: Like the last package that he pushed through, I think it was too hurried, and a lot of mistakes, a lot of things that shouldn't be.

HENRY: But Cathy Montgomery, assistant produce manager, voted for the president, and is pumped he's getting tough with Congress.

CATHY MONTGOMERY, ASST. PRODUCE MANAGER, KROGER SUPERMARKET: I like the fact he's stepped up and he's being aggressive. I really do. I mean, I'm just -- I'm all for that.

HENRY: Thousands in this region showed up at a health expo offering free medical care this past weekend, exposing a problem all too familiar to doctors here.

DR. BENNETT COWAN, JR., HOSPICE MEDICAL DIRECTOR: Clearly, we all recognize, any physician in the hospital would recognize that it's a system in crisis.

HENRY: But like most employees back at the Kroger Supermarket, produce manager Steve Shipplett gets generous health benefits. Despite being an Obama voter, he's nervous those benefits might be taxed to cover the uninsured and is demanding more specifics from the president.

STEVE SHIPPLETT, PRODUCE MANAGER, KROGER SUPERMARKET: He's going to have to spit out some numbers and let the public know exactly what it's going to cost them and what they're going to have to give up.

HENRY: Shipplett says if the president steps out and sells it, then he's willing to step up himself.

SHIPPLETT: You got to do something, and if it means me paying those taxes to get this reform through, then I'd begrudgingly do it, yes.

HENRY: And back in the frozen food aisle, this Republican is ready to do his share, too.

YOUNCE: No matter what kind of plan you're going to come up with, somebody has to pay for it. So, eventually, it comes down to us, the people that's working and paying taxes. We're going to have to pay for it one way or the other. I just hope we can come up with a plan that's worth paying for.

HENRY: These employees note they make less than $250,000 a year. And the president has repeated his campaign promise he won't raise taxes on people in that category. Nevertheless, these employees say they may accept a broken campaign promise if the president does a few things -- if he makes sure the rich pay their fair share and if he finally gets specific, lays out the sacrifices people will have to make, and proves this plan will actually work.

Ed Henry, CNN, Bristol, Virginia.

(END VIDEOTAPE)

HARRIS: And we will have Republican reaction following the president's town hall meeting, which is scheduled to get under way any moment now.

Congressman Eric Cantor, the minority whip, will join Kyra Phillips for a live interview during the next hour of CNN NEWSROOM.

And the woman whose phone call brought police to the home of Harvard Professor Henry Louis Gates speaks publicly for the first time any moment now. It has been almost two weeks since Lucia Whalen called 911 to report a possible break-in. The incident led to the arrest of Gates at his home. It sparked accusations of racial profiling.

We now know Whalen never referred to black suspects in that 911 call.

(BEGIN AUDIO CLIP)

911 OPERATOR: Are they still in the house? LUCIA WHALEN, WITNESS: They're still in the house I believe, yes.

911 OPERATOR: Are they white, black, or Hispanic?

WHALEN: Well, there were two larger men. One looks kind of Hispanic, but I'm not really sure.

(END AUDIO CLIP)

HARRIS: And we are monitoring Lucia Whalen's news conference for you in Cambridge, Massachusetts.

The arrest of Professor Gates has ignited a passionate discussion about race relations. We want to hear from you on this.

Have you been a victim of racial profiling? If you work in law enforcement, what are the challenges you face while policing diverse communities?

Just go to ireport.com and share your personal stories or video. Just put it on video for us and you could be featured on CNN.

Federal agents are searching for an eighth terror suspect today. He is believed to be in Pakistan.

These men among seven alleged accomplices are jailed today in North Carolina. Prosecutors accuse the men of plotting attacks in Pakistan. An indictment claims the group's alleged ringleader, Raleigh drywall contractor Daniel Boyd, trained in Afghanistan and Pakistan. His wife told CNN the public shouldn't rush to judgment.

(BEGIN VIDEO CLIP)

SABRINA BOYD, DANIEL BOYD'S WIFE: I know that my husband and my sons are free of guilt, and I'm hopeful that the truth will come to light.

(END VIDEO CLIP)

HARRIS: Sabrina Boyd says trips to the Middle East were religious pilgrimages, and she explained an alleged training site. Prosecutors say her husband used this way just to further helping his son -- his Boy Scout sons -- with marksmanship.

(BEGIN VIDEO CLIP)

BOYD: I will say that we do have -- we do own guns in our home, as our constitutional right allows us. And I don't think there's a crime in that.

(END VIDEO CLIP)

HARRIS: Well, Homeland Security Secretary Janet Napolitano didn't discuss the North Carolina case in a speech today, but she said privatized terrorism is growing. (BEGIN VIDEO CLIP)

JANET NAPOLITANO, HOMELAND SECURITY SECRETARY: We face a network enemy. We must meet it with a network response.

The job of securing our nation against the threat of terrorism is a large one, and it may never be totally completed. But we have a much larger chance at success if we strengthen our own networks by enlisting the talents and energies of Americans.

Countering the terrorist threat is not just the effort of one agency, it is one element of society. Nor is countering terrorism the consequence of one tactic. Rather, it requires a holistic, unrelenting approach at all levels, with all tactics and all elements of society.

(END VIDEO CLIP)

HARRIS: OK. Napolitano spoke at the Council on Foreign Relations in New York. She announced new measures to boost communication between federal, state and local law enforcement.

Let's quickly now get you to the president, his town hall meeting in Raleigh, North Carolina.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: And Raleigh, to be back in North Carolina, this is a community and a state that has been so good to me.

(APPLAUSE)

And I know that part of the reason is because I travel with one of your home boys, Reggie Love.

(APPLAUSE)

But I hope it's more than that.

A couple of people I want to acknowledge very quickly. First of all, I just want to thank Sara Coleman for the wonderful introduction. Give her a great round of applause.

(APPLAUSE)

You know, she brought me a Cupcake Factory T-shirt, but no cupcakes.

(LAUGHTER)

I mean, I know I've been talking about health care a lot, but I think cupcakes are good for your health.

(LAUGHTER)

So, next time...

I also want to acknowledge the Broughton High School Jazz Ensemble.

(APPLAUSE)

I want to thank Gardner Taylor for the invocation, Tom Gill for the Pledge of Allegiance, Chelsea Cole for the national anthem, Del Burns, our Wake County public school superintendent. I want to thank Stephen Mares, the Broughton High School principal.

(APPLAUSE)

I want to thank your own governor, Bev Perdue, who's here.

(APPLAUSE)

Unfortunately, Senator Kay Hagen, Senator Richard Burr and Congressman Brad Miller can't be here because they're all working hard in Washington. Give them a big round of applause.

(APPLAUSE)

We also have the Raleigh Mayor Charles Meeker (ph) is here. Where's Charles? There he is right here.

(APPLAUSE)

We've got the speaker of the house right here. Give him a big round of applause.

(APPLAUSE)

I hear that the former governor, Jim Hunt, is in the hall.

(APPLAUSE)

There are a lot of elected officials. I'm starting to get into trouble, so I'm going to stop there and just say thank you to all of them for their outstanding service.

It is not only great to be in Raleigh, it is also nice to get out of Washington. With all the noise, and the fussing, and fighting that goes on, it's pretty easy for the voices of everyday people to get lost, and for folks to forget why they're there.

So when I took office in January, I asked to receive -- to see 10 letters from people across the country every day. They're just selected by the mail room. We get about 40,000 letters a day. They send me about 10 a day, and I read through them.

And some of them are heartbreaking. People talking about the tough times they're going through. Some of them are inspiring. Most of the letters these days are about one thing -- and that's the economy.

So this is town hall meeting, but before I take your questions, I want to spend a few minutes just talking about where we are and where we need to go on the economy. I don't know whether you've seen the cover of the latest cover of "Newsweek" magazine on the rack at the grocery store, but the cover says, "The Recession is Over."

Now, I imagine that you might've found the news a little startling. I know I did. Here's what's true: we have stopped the freefall. The market's up and the financial system is no longer on the verge of collapse. That's true.

(APPLAUSE)

We're losing jobs at nearly half the rate we were when I took office six months ago.

(APPLAUSE)

We just saw -- we just saw home prices rise for the first time in three years.

(APPLAUSE)

So there's no doubt that things have gotten better. We may be seeing the beginning of the end of the recession. But that's little comfort if you're one of the folks who have lost their job, and haven't found another.

Unemployment in North Carolina is over 10 percent today.

OBAMA: A lot of small businesses like Sara's are still struggling with falling revenue and rising costs. Health care premiums, for example, are rising twice as fast as wages, and much more for small businesses -- something that I'll talk about a little bit later.

So we know the tough times aren't over. But we also know that without the steps we have already taken, our troubled economy - and the pain it's inflicting on North Carolina families -- would be much worse.

Let's look at the facts.

When my administration came into office, we were facing the worst economy of our lifetimes. We were losing an average of 700,000 jobs per month. It was nearly impossible to take out a home loan or an auto loan or a student loan, and loans for small business to buy inventory and make payroll. And economists across the ideological spectrum, conservatives and liberals, were fearing the second coming of a Great Depression.

At the time, there were some who thought that doing nothing was somehow an option. I disagreed. We knew that some action was required. We knew that ending our immediate economic crisis would require ending the housing crisis where it began, or at least slowing down the pace of foreclosures.

That's why we took unprecedented action to stem the spread of foreclosures by helping responsible homeowners stay in their homes and pay their mortgages.

We didn't stop every foreclosure. We couldn't help every single homeowner who had gotten overextended. But folks who could make their payments with a little bit of help, we were able to keep them in their homes.

Ending this immediate crisis also required taking steps to avert the collapse of our financial system, which, as Fed Chairman Bernanke said the other day, was a real possibility.

Now, let me just say this about banks. I know it didn't seem fair to many Americans to use tax dollars to stabilize banks that took reckless risks and helped to cause this problem in the first place. It didn't seem fair to me, either.

And even though the bank bailout began under the previous administration, and I wasn't always happy with the lack of accountability when it was first begun, I do believe that it was actually necessary to step in, because by unlocking frozen credit markets and opening up loans for families and businesses, we helped stop a recession from becoming a depression.

And by the way, taxpayers are already being paid back by the banks, with interest.

We also took steps to help a struggling auto industry emerge from a crisis largely of its own making. Again, some folks thought, Why are we doing that? There was a strong argument to let General Motors and Chrysler go under, and I know many of you probably share that view.

OBAMA: And if we had been in ordinary times, not teetering on the brink of depression, we might have exercised other options.

Because, if you make a series of bad decisions that undermine your company's viability, the folks back here, they probably wouldn't get bailed out; your company wouldn't be in business. And many folks didn't see why these companies should be treated any differently.

But in the midst of a recession, their collapse would have wreaked even worse havoc across our economy. So I said, if GM and Chrysler were willing to do what was necessary to make themselves competitive; and if taxpayers were repaid every dime they put on the line, it was a process worth supporting.

We saved hundreds of thousands of jobs as a result, and we expect to get our money back.

Now, even as we worked to address the crisis in our banking sector, in our housing market, in our auto industry -- and, by the way, there was a flu that came by, during that process...

(LAUGHTER)

... we also began attacking our economic crisis on a broader front. Less than one month after taking office, we enacted the most sweeping economic recovery package in history.

And by the way, we did so...

(APPLAUSE)

We did so without any earmarks or wasteful pork-barrel projects, pet projects, that we've been accustomed to. Not one was in there.

(APPLAUSE)

Now, there's a lot of misinformation about the Recovery Act or the stimulus, whatever you want to call it, so let me just lay out the facts. Because I think some folks are confused.

As I was driving in, everybody was -- there were some folks cheering and then there were some folks with signs.

(LAUGHTER)

So -- so I hope they're paying attention, because -- because I want to make sure everybody understands exactly what the Recovery Act was all about.

To date, roughly a quarter of the Recovery Act's funding has been committed. Over 30,000 projects have been approved. Thousands have been posted online, as part of an effort to uphold the highest standards of transparency and accountability when it comes to our economic recovery.

Now, the Recovery Act is divided into three parts. And I know a lot of people think, oh, this is just blowing up government and wasting money. Let me describe exactly where this money went, just so, if your friends or neighbors talk to you, you can -- you can give them the right information.

One-third of the entire Recovery Act is for tax relief for you, for families and small businesses -- one-third of it.

(APPLAUSE)

OBAMA: Ninety-five percent of you got a tax cut. You may not notice it...

(LAUGHTER)

... because it's appearing in your paycheck on a weekly basis -- every time you get a paycheck, as opposed to you getting a lump sum. Because it turned out that by spreading it out, it had more of a potential to stimulate the economy. That's what the economists advised us to do.

But a third of it is going to tax breaks to individuals and small businesses. That's money in your pocket to buy cupcakes and other necessities of life. (LAUGHTER)

So for Americans struggling to pay rising bills with shrinking wages, we have kept a campaign promise to put a middle-class tax cut in the pockets of 95 percent of working families.

(APPLAUSE)

That began showing up in your paycheck about three months ago.

(APPLAUSE)

We also cut taxes for small businesses on the investments that they make.

So just remember this -- one-third of it -- if you think about the recovery, it was a little under $800 billion, a third of it went to tax cuts. And all those folks who are complaining about growing government and all that stuff? We are actually cutting your taxes, giving your money back so you can spend it. That's a third.

Another third of the money in the Recovery Act is for emergency relief that is helping folks who've borne the brunt of this recession. For Americans who were laid off, we expanded unemployment benefits --a measure that's already made a difference for 12 million Americans.

(APPLAUSE)

So we extended unemployment insurance. That's made a difference in 12 million Americans, including 300,000 folks in North Carolina who would have been cut off from unemployment insurance if we hadn't extended it.

OBAMA: We're making health insurance 65 percent cheaper for families who are relying on COBRA while looking for work.

(APPLAUSE)

So let me just see a show of hands. How many people know what COBRA is? All right. So you know that if you lose your job, you're allowed to keep your health insurance by paying premiums through COBRA. Here's the problem: If you've lost your job, and your premium is $1,000, right at the time when you've got no job, it's hard to come up with that money -- right?

So what we did in the Recovery package was to say: We're going to give 65 percent of those costs -- we will pick up so that you can keep your health insurance while you're looking for a job.

(APPLAUSE)

And for states who are facing historic budget shortfalls -- I was just talking to the governor and the speakers -- we provided assistance that has saved the jobs of tens of thousands of teachers, and police officers, and firefighters.

(APPLAUSE)

So that's the second third. I just want to remind everybody: First third -- tax cuts; second third was providing emergency relief to families who had lost their jobs, for their insurance, and to support them with unemployment insurance, and states -- that otherwise would have billions of dollars in shortfalls.

Now, that's two-thirds of the money of the Recovery Act. And if we hadn't put that in place, imagine the situation that people would be going through, right now. It would be a lot worse. And the states would be going through a lot tougher times having to make cuts that they don't want to make.

All right. So this brings us to the last third. And this is where the critics will say, "OK, well, maybe we agree with the tax cuts. Maybe we agree with the assistance to the states and to individuals. But what about that last third -- all those investments?"

Well, you know what? We decided that the last third should be for short-term and long-term investments that are putting people back to work and building a stronger economy for the future. And...

(APPLAUSE)

... I want you to know -- this money is not being wasted. We're seeing the results of these investments here in Raleigh and across North Carolina. The Beltline is being resurfaced between Wake Forest Road and Wade Avenue.

(APPLAUSE)

The Raleigh Durham Airport is renovating its runways. The city of Raleigh's transit system is building a new operations and maintenance facility.

(APPLAUSE)

Over 500 people are going to work as part of a summer youth work initiative.

(APPLAUSE)

OBAMA: Water treatment plants are being renovated throughout the Triangle. These are the kinds of projects being launched across the country to rebuild crumbling roads and highways and bridges and waterways, with the largest new investment in our national infrastructure since Eisenhower built the interstate highway system in the 1950s, and that puts people to work right away, but it also creates a long-term sustainable economic future.

Now, I know that there are some critics in Washington, maybe out there, they say, well, you've been too slow getting these projects started. They're saying we should have broken ground on all our highway projects on the first day. Well, that's impossible, especially because I wanted to be sure we did our homework and invested our tax dollars only in those projects that actually created jobs and jump-started our economy.

(APPLAUSE)

So we knew -- we knew that it was going to take a few months before these projects got on line. That takes time, if you're going to do it right. And we've already eliminated wasteful projects that didn't meet this test, because every taxpayer should have the assurance that we're investing their hard-earned tax dollars responsibly.

So just remember, if somebody asks you about the stimulus or the recovery, one-third of it is in your pocket in tax cuts. One-third of it is unemployment insurance relief, help on COBRA, and making sure that states don't have to make cuts that would make things worse. One-third of it, investments in roads and bridges, is putting people back to work.

So it will take time to achieve a complete recovery. We're not going to rest until anyone who's looking for work can find a job.

(APPLAUSE)

But there -- there should be little debate that the steps we took, taken together, have helped stop our economic free fall. That's the story of the first six months. It's cost some money to do this, although I've got to say when I hear critics talk about out-of-control spending, I start scratching my head. I can't help but remember those same critics contributed to a $1.3 trillion deficit that I inherited when I took office.

(APPLAUSE)

I mean, seriously, you know, I'm now president so I'm responsible for solving it, but I -- I do think we shouldn't have a selective memory in terms of spending habits. You hand me a $1.3 trillion bill and then you're complaining six months later because we haven't paid it all back.

(LAUGHTER)

(APPLAUSE)

You know, a debt, by the way, that was partially a result of two tax cuts that went primarily to the wealthiest few Americans, and a Medicare drug program that wasn't paid for. These are the same folks who are now complaining about, well, health care, we can't afford health care. You passed a prescription drug plan and didn't pay for it, handed the bill to me.

(LAUGHTER)

Now, because of that debt, a lot of people are saying we can't go any further in tackling our problems.

OBAMA: "We definitely can't do health care. Too much debt. Too big deficits." Look, I understand the concern about debt. I have to -- I'm looking at these spreadsheets every day. We dug ourselves a deep hole. And because of the recovery package that we put together, you know, that has added to it.

So we now have problems. We're going to have to tighten our belt. But we can't do it in the middle of the stimulus, we can't do it in the middle -- just as the economy is coming out of recession. No economist would recommend that.

And I do understand people who feel like they've had to cut back, so should -- shouldn't the government have to cut back? Why start anew government program now?

So let me just explain why the health of the American people and the American economy demands health insurance reform. I want to just explain briefly reform, what it will mean for you. And then we'll start taking questions.

First of all, nobody is talking about some government takeover of health care. I'm tired of hearing that.

(APPLAUSE)

I have been as clear as I can be. Under the reform I've proposed, if you like your doctor, you keep your doctor. If you like your health care plan, you keep your health care plan. These folks need to stop scaring everybody. You know?

(APPLAUSE)

Nobody -- nobody is talking about you forcing to have to change your plans.

But if you're one of the 46 (sic) Americans who don't have coverage today, or you've got that coverage where you've got a $10,000 deductible, so it's basically house insurance, it's not health insurance, you have it -- you pay the premium so you won't lose your house if you get hit by a bus, heaven forbid. Then you'll finally be able to get quality, affordable coverage.

But what a lot of chatter out there hasn't focused on is the fact that if you've got health insurance, then the reform we're proposing will also help you because it will provide you more stability and more security. Because the truth is, we have a system today that works well for the insurance industry, but it doesn't always work well for you.

So what we need and what we will have when we pass these reforms are health insurance consumer protections to make sure that those who have insurance are treated fairly and insurance companies are held accountable. Let me be specific. We will stop insurance companies from denying you coverage because of your medical history.

I've told this story before. I'll never forget watching my own mother, as she fought cancer in her final days, worrying about whether her insurer would claim her illness was a pre-existing condition so they could wiggle out of paying for her coverage.

How many of you have worried about the same thing? A lot of people have gone through this. Many of you have been denied insurance or heard someone who was denied insurance because they got -- had a pre-existing condition. That will no longer be allowed with reform. Now, we won't allow that. We won't allow that.

With reform, insurance companies will have to abide by a yearly cap on how much you can be charged for your out-of-pocket expenses. No one in America should go broke because of an illness. We will require insurance companies to cover routine checkups and preventive care, like mammograms and colonoscopies. Eye and foot exams for diabetics, so we can avoid chronic illnesses that cost not only lives, but money.

No longer will insurance companies be allowed to drop or water down coverage for someone who's become seriously ill. It's not right. It's not fair. We will stop insurance companies from placing arbitrary caps on the coverage you can receive in a given year or in a lifetime. So my point is, whether or not you have health insurance right now, the reforms we seek will bring stability and security that you don't have today. Reforms that will become more and more urgent with each passing year.

So, in the end, the debate about reform boils down to a choice between two approaches. The first is projected to double your health care costs over the next decade, make millions more Americans uninsured, bankrupt state and federal governments, and allow insurance companies to run roughshod over consumers. That's one option. That's called the status quo. That's what we have right now.

I want -- I want everybody to understand this. If we do nothing, I can almost guarantee you, your premiums will double over the next 10 years, because that's what they did over the last 10 years. It will go up three times faster than your wages, so a bigger and bigger chunk of your paycheck will be going in to health insurance. It will eat into the possibility of you getting a raise on your job, because your employer's going to be looking and saying, I can't afford to give you a raise because my health care costs just went up, 10, 20, 30 percent. And Medicare, which seniors rely on, is going to become more and more vulnerable. On current projections, Medicare will be in the red in less than 10 years.

So, that's the status quo. When everybody goes around saying, why is Obama taking on health care? That's the answer. That's one option. I don't like that option. You shouldn't either. That plan doesn't sound too good. That's the health care system we have right now.

So we can either continue with that approach, or we can choose another approach. One that will gradually bring costs down, will improve quality and affordability for every American when it comes to their health care and will help get our exploding deficits under control. That's the health care system we can bring about with reform. So, back in Washington, there's been a lot of talk about the politics of health care and who's up and who's down and what it will mean for my party if this, you know, will my presidency be, you know, damaged severely if we don't pass health care. I keep on saying to people, I've got health care. This is not for me. Here in North Carolina, you know this isn't about politics. This is about people's lives. This is about people's businesses. This is about the future. I want our children and our grandchildren to look back and say, "this is when we decided to take the politics out of it and start doing something for the future of this country." I'm going to need your help, Raleigh. Let's go do it!

Thank you. Thank you. Thank you very much. Thank you very much.

All right. I was getting fired up there at the end.

OK. So this is the -- this is the town hall portion.

UNIDENTIFIED MALE: (INAUDIBLE).

OBAMA: OK. Sorry, I can't hear you, sir. Sir, I'll be happy to take your question, but -- all right. I'll be happy to take your question, but maybe let's do it in an orderly fashion. Thank you, sir, we appreciate you.

Where was I? Here's what we're going to do. We're going to go girl, boy, girl, boy. We're going to go around the room. I'm going to try to take as many questions as I can. If you can keep your answers short -- or your questions short, I'll try to keep my answers short. And just raise your hand. I won't be able to get to everybody. There are people with microphones in the audience. So if you can wait until somebody with a microphone finds you, that way we'll be able to hear your questions.

People with the microphones, can you wave or -- just so I can see you. All right, there they are.

All right. So I said girl, boy, girl, boy. We'll start with this young lady right here. Here, she's coming with the microphone. The one in the white blouse.

And please introduce yourself, if you don't mind. Why don't you stand up so everybody can see you.

UNIDENTIFIED FEMALE: OK. I'm so honored to be here and thank you for taking my question first. Wow, I'm really nervous. So, I guess I want to ask -- I was a . . .

OBAMA: What's your name?

UNIDENTIFIED FEMALE: My name's Kim.

OBAMA: Hey, Kim.

UNIDENTIFIED FEMALE: And I'm here from the Chapel Hill area. OBAMA: Right.

UNIDENTIFIED FEMALE: As the wife of a family physician, we see people not only coming in to that specialty less and less often, but also leaving that specialty because it's so, so hard as a young family to make that work, long hours, not great reimbursement, not great pay.

OBAMA: Right.

UNIDENTIFIED FEMALE: With huge amounts of debt when you come out of medical school.

OBAMA: Right.

UNIDENTIFIED FEMALE: So what are you thinking of to entice more people to come into that specialty, because you can insure every person in America, and if there's not a physician there to see that person, you still don't have health care. So what are you going to do to entice people to come into (INAUDIBLE)?

OBAMA: This is a great question. And -- so let me -- just so everybody understands what we're talking about here, it used to be that the most common type of doctor was the family physician. You know, you'd go in and they knew you and they knew your family and every once in a while you'd go to a specialist, but basically you were dealing with a family doctor. Increasingly, the economics of being a primary care physician or a family doctor is a bad deal for a lot of medical students because they come out with hundreds of thousands of dollars of debt, but it turns out that a primary care physician, as Kim just pointed out, their reimbursement rates are lower, the system doesn't reimburse for things like preventive care. If they stop one of their patients from smoking, they don't get reimbursed for that. But they do get reimbursed if they're a surgeon and they have to open up somebody's chest.

Now, actually, that first part of it is probably more valuable to the person's health and to the society as a whole. But if it's not rewarded, then fewer and fewer people go into that branch of medicine. If we pass health reform, when we pass health reform, then what we're going to -- what we are -- and more people now (AUDIO GAP) in the delivery system.

So, what we're trying to do is we're trying to say, in all these systems, insurance companies, they should reimburse for preventive care. If a health system is making sure that a diabetic is taking their meds or monitoring their diet, they should get reimbursed for that, not just getting reimbursed for the $30,000 foot amputation after somebody, you know, gets into real medical trouble. So, one thing to do is to change reimbursements so that the incomes of primary care physicians are more comparable with specialists. The second thing is . . .

HARRIS: All right. Very quickly, we're going to leave the president's town hall meeting in Raleigh, North Carolina, for a very good reason. Our senior congressional correspondent, Dana Bash, is on the phone with us. And is this Dana Bash that I'm speaking with?

DANA BASH, CNN CORRESPONDENT: It is. Hi, Tony.

HARRIS: All right, Dana, great. Dana, I understand you have some breaking developments. And, again, we're talking about a possible compromise on health care reform.

BASH: That's right. This is good news for the president as he speaks about health care reform. We've been talking about the feuding Democrats in the House and that feud has delayed the president's top priority.

Well, we understand that there is now a deal between some of the key Blue Dog conservative Democrats and House leaders. There is a deal that -- and here's what we know. We know a few details. We're going to get more, but here's the headline. The headline is that they are going to put some kind of bill into committee. That vote is going to happen by week's end.

However, as part of the deal, this full house is not going to bring up health care reform until the fall. We understand just a little bit of detail, that they have -- that those conservative blue dog Democrats have been successful in bringing down the cost of this health care bill by about $100 billion, but that's all we know so far.

The key is, they are going to move forward. There will be a committee vote by Friday. But the full House will not vote until the fall. That is part of (INAUDIBLE) just brokered after hours and hours of talks.

HARRIS: Wow.

BASH: Inside the House speaker's office. The White House chief of staff, Rahm Emanuel, was there. Blue Dogs, House leaders. And this just happened moments ago.

HARRIS: All right, are we talking about -- are we talking about Congressman Waxman's committee here?

BASH: Exactly.

HARRIS: I see.

BASH: Exactly. You've seen and heard Congressman Mike Ross.

HARRIS: Yes.

BASH: He is a conservative blue dog from the state of Arkansas. He has been negotiated with the chairman of the Energy and Commerce Committee, Henry Waxman. And they, with the help of the leadership, including the House speaker and the White House, who -- and the chief of staff has basically been camped out here -- they have created this deal that allows the committee to go forward this week, but a full House vote will not happen until the fall.

And this, I should tell you, is according to our great producers, Deirdre Walsh and Evan Glass, who have been standing outside the door.

HARRIS: You guys have really been working hard as a team on this. And this is interesting. So we're talking about a bill that will now go to the full committee for consideration?

BASH: That's correct. The full committee. In fact, they're going to meet at 4:00 this afternoon, Tony, and they're going to begin the arduous work of marking it up or going line by line and working on it, with the goal of probably going throughout the night in order to get this done by Friday.

And the key is that we're talking about the House. You know, this is separate from where I've been standing over the past several days, that's the Senate Finance Committee. This is simply the House. But there's has been, you know, a revolt among the president's fellow Democrats, those conservative Democrats, who have not liked the way their party leaders crafted their health care plan, for the most part because they felt that the costs was too high and because it did not do enough to control the costs of health care.

HARRIS: Yes. Them bending that curve that we keep hearing so often.

BASH: Exactly. In terms -- we're still waiting for the details, but at this point what we know is that they were successfully able to bring the costs of the health care bill down by about $100 billion.

HARRIS: All right. And just to be clear here, my understand, Dana, correct me where I'm wrong here, is that there are -- work has been completed on two other House bills. So we are talking about the last key committee, Energy and Commerce, chaired by Congressman Waxman, has now come together. The blue dogs on that negotiating committee have come to some kind of an understanding on a bill that will go before the full committee. Is that a decent recap of where we are?

BASH: That is it. That is it. And it's highly significant. Highly significant. Because these conservative Democrats have successfully been holding up and delaying their own president's top priority, because they felt that it didn't do enough of what he said he wants to do, which is to control costs. And at this point, they have -- they feel that they have gotten enough assurances that it will do that, that they can move forward, at least in this last committee.

HARRIS: Right.

BASH: And, you know, it really is -- it really is a significant breakthrough in that, you know, these guys have been -- have been pretty strong.

HARRIS: Absolutely.

BASH: And pretty intense on not allowing their own leadership and their own president to go forward on something that they didn't think did the right things. HARRIS: Now, Dana, we're going to get back to the president's town hall in just a minute, but I can't let you go without -- all right, so that is the breakthrough on the House side. There also appears to be real progress being made on the Senate side as well. Why don't you bring everyone up to speed on that as well.

BASH: That's right. On the Senate side, you do have the negotiators continuing to meet. They met this morning. They'll meet later on this afternoon. The chairman of the Finance Committee came out and said that they have one particular concept that would actually bring the costs down from a trillion dollar health care plan to under $900 billion.

But, you know, in the same breath as he made that announcement to try to, you know, push some progress and give the idea of momentum, the same breath he cautioned, well, you know, we're not there yet and we still have a lot more work to do.

And I can tell you, Tony, talking to Republicans -- there are three Republicans and three Democrats in that room. Talking to Republicans, there is a lot of consternation among Republicans that Democrats may be pushing a little too fast and trying to potentially get headlines saying that they're going to come close to a deal because those three Republicans in that room are under a lot of pressure by their own party and their own party leadership not to -- to give too much, to give too much of the store away. So, that's what's going on there.

HARRIS: Great.

BASH: Those talks continue. But the headline, of course, and the news right now is a breakthrough among Democrats in the House of Representatives.

HARRIS: Our senior congressional correspondent, Dana Bash, on the phone with us.

Dana, appreciate the update on the new developments health care reform.

Let's get you back to the president's town hall meeting in Raleigh, North Carolina.