Return to Transcripts main page

CNN Newsroom

Selling the Budget to the Public; California Convicts Cut Loose Due to Budget Cuts; Tennessee Family Doctor is Registered Sex Offender

Aired February 01, 2010 - 10:00   ET

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

KYRA PHILLIPS, CNN ANCHOR: At any moment, the White House unveils its proposed budget. Can President Obama keep his promises by putting your money where his mouth is? At the White House the president will highlight his priorities later this hour. We're going to get the reaction from there and also on Capitol Hill.

Also, CNN staffers poring through the details as we speak; you can see right there in our CNN NEWSROOM.

Here's what we know right now. The proposals add up to more than $3.8 trillion. That's about $100 billion would be spent on creating jobs. Here's some more of the controversial parts of that budget.

It would freeze spending on some government programs. It would also boost taxes on the wealthy and it would include record breaking deficit this year of more than $1.5 trillion.

Now let's get the view from the White House. That's where we find our CNN Suzanne Malveaux. Suzanne, we're supposed to hear from the president later this hour. We will take that live. But how does he plan to sell this budget to the public, bottom line?

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Bottom line, Kyra, we're going to be hearing from him very shortly. He's going to sell it very much like we heard from President Bush selling his budget. He's going to make the case here that there's some programs that are not working, some are duplicates, some are wasteful and that those are the kinds of programs that are going to be eliminated.

The wasteful spending, and be more efficient in government spending by taking a look at things that work. I had a chance to speak with the OMB director Peter Orszag earlier this morning. I asked him that very question. Who are the winners? Who are the losers? What kinds of cuts are we going to see? You talked about some of the expenditures, trying to create new jobs, $100 billion or so.

Peter Orszag told me about the C-17. It's a military cargo plane that's basically going to be retired. That's just one of the cuts. But there are also cuts when it comes to the EPA, the Army Corps of Engineers. These are the kinds of details that obviously, Kyra, we're going to be poring through in the next couple of minutes here. We just got our copy of the budget. But Peter Orszag explains to me it's a balancing act here. You've got on the one hand trying to create jobs, tell the American people that he understands the priorities, but at the same time know that he's trying to be fiscally conservative with the government and the taxpayers' money. Take a listen.

(BEGIN VIDEO CLIP)

PETER ORSZAG, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET: We're focused on spurring job creation this year, including through a new tax credit for small business hiring, investing in education and R&D and, again, we need to be bringing the deficit down. So there are some adjustments that need to be made, but we're trying to do so in a way that just eliminates duplicative and unnecessary programs.

(END VIDEO CLIP)

MALVEAUX: Kyra, I was just handed the rest of this here. You might be able to take a look at it. I know you mentioned some folks in the newsroom were poring through all of these pages. This is the addendums here. Obviously, the tables and context. This is the main summary here. And we have learned that there are about 120 programs that are going to be terminated, reduced to provide some savings here.

So we're going to be poring through all this stuff and get you those details and exactly which of those programs are going to be eliminated and which kinds of programs are actually getting a boost -- Kyra.

PHILLIPS: I love it. So how many times, Suzanne, do we talk to you at the White House and you have the budget in front of you that you're combing over throughout the commercial breaks? I got to hand it to you.

MALVEAUX: You know, we've done this before many, many times here. And obviously, you just try to get your Post-It and run and get the figures you need as quickly as possible. No time for this just quite yet.

PHILLIPS: Yes, exactly. All right. We're all standing by. We appreciate it. Suzanne, thanks so much. And of course, kudos to our crew.

MALVEAUX: (INAUDIBLE)

PHILLIPS: Yes, no kidding. And kudos to our crew there in our D.C. bureau as well. Once again, stay with us. Live coverage of the president's remarks on the budget. It's your money and how it's going to be spent, you'll want to watch. Scheduled to speak later this hour, 10:45 Eastern.

A dramatic population shift underway right now in California. Convicts cut loose from their sentences. Why? To save cash. Yes. It's a symptom of the state's growing budget crisis. And you can bet it isn't sitting very well with police.

CNN's Casey Wian live in Los Angeles with more. I can just imagine members of law enforcement, Casey, not to happy about this.

CASEY WIAN, CNN CORRESPONDENT: You're absolutely right, Kyra.

Indio, California, is a fast growing city about 130 miles east of Los Angeles that has worked hard to cut its violent crime rate in half during the last five years. The local law enforcement officials are very worried that because of the state's budget crisis, that violence will again erupt on Indio's streets.

(BEGIN VIDEOTAPE)

WIAN (voice-over): Just a few years ago, simply walking down these streets with Indio, California's police chief would have been risky.

CHIEF BRADLEY RAMOS, INDIO POLICE DEPARTMENT: This particular neighborhood was very, very violent. We would have - in one particular point in time over an 18-month period we had six homicides that all occurred within a four-block area.

WIAN (on camera): And this is an area where the police station is located, right?

RAMOS: It's just a few blocks from our police station.

WIAN: what used to go on here? What types of crimes?

RAMOS: We would have drive-by shootings. We would have shots fired calls. We would have gang violence and gang fights.

WIAN: So where are all the bad guys?

RAMOS: In prison.

WIAN (voice-over): Perhaps not for long. This year, California is reducing the number of inmates in its notoriously overcrowded and violent prisons by more than 6,000 to save $1 billion.

MATTHEW CATE, CALIFORNIA CORRECTIONS DEPARTMENT: We were just flat out of room. And the state's out of money. So we've had to take these steps.

WIAN: Cate says the only inmates with get out of jail free cards will be ones the state considers low-risk offenders and parolees who won't be returned to prison because of minor violations. The Corrections Department is also offering early release to inmates who obtain high school equivalency certificates and job training.

RAMOS: When they come home, based on the budget cuts that we're seeing statewide, at the county and at the local level, there's not going to be a support mechanism. My concern is the state is saying, yes, we're going to provide this and this. But how am I assured as a chief of police that has responsibility for over 90,000 people that I can ensure that the state is going to follow up on their word?

WIAN: At risk, a community that's been transformed. Where parks have replaced gang turf and new mothers feel safe to walk the streets.

RAMOS: How do I tell a crime victim of a violent crime that the reason why she's a victim is somebody was out and wasn't being supervised?

(END VIDEOTAPE)

WIAN: What's even more worrisome to local police throughout California is the fact that California is under a federal court order to reduce its prison population by 40,000 inmates over the next three years. That order is on hold for now pending a possible review by the Supreme Court -- Kyra.

PHILLIPS: So, of course, Casey, now a lot of people there in California saying to themselves, OK, what exactly is a low-risk offender? Can I be confident that child molesters and rapists and murders are not going to just be roaming the streets?

WIAN: Local police say not necessarily so. Because there's gang bangers, drug dealers, people like that, very violent people, who they managed to finally put away after years of criminal behavior on maybe a minor burglary charge or maybe a parole violation.

And if those kinds of people get out and return to their neighborhoods, they're really worried that some of these neighborhoods that they've cleaned up are just going to go back to their old ways at a time when local law enforcement resources to deal with these types of issues are being squeezed as well, Kyra.

PHILLIPS: Got it. Casey Wian, appreciate your time this morning.

Your family doctor. You trust them with your health and your children. OK, now say your family doctor is a registered sex offender. How would that sit with you? In one state, it's not only happening, it's perfectly legal.

(COMMERCIAL BREAK)

PHILLIPS: Stay with us for live coverage of the president's remarks on his new budget this morning. It was released just a few minutes ago. And the proposals add up to more than $3.8 trillion. The president's scheduled to speak later this hour, 10:45 Eastern, and we'll take it live.

Now, the winter weather this past weekend wasn't just severe, it was deadly for seven people in Oklahoma. They lost their lives. Authorities say at least two of the deaths were senior citizens who had lost power at their homes and possibly froze to death.

Could be a similar story outside Cincinnati now, too. The bodies of an elderly couple were found Saturday afternoon. Police believe that they might have somehow gotten locked out of their home. As you can imagine, their neighbors were pretty stunned.

(BEGIN VIDEO CLIP) CHERYL MILLER, NEIGHBOR: We would have been there if we'd known they needed us. But you know, the back of the house, from the road you can't see anything.

KIM PARKER, NEIGHBOR: This is awful. I mean, you wouldn't think of that happening with all the neighbors being so close and everything.

(END VIDEO CLIP)

PHILLIPS: Farther south in North Carolina, authorities say that there were at least four weather-related deaths over the weekend. They're not done just yet, either, with that nasty weather. Forecasters say that freezing rain is expected that could cause black ice.

(WEATHER REPORT)

PHILLIPS: Well, here's a story that's so outrageous that we honestly didn't believe it when we first heard about it, so let me see what you think. In Tennessee, a violent sex offender holds one of the most trusted positions you can imagine. He's a family doctor.

David Livingston is on a sex offender list for violating children and had been denied licenses in other states. Tennessee not only granted him that license, but get this - the state reportedly had other doctors who are also on the sex offender registry. So let me ask, are you as shocked as we were? Our next guest said that she was appalled when she first heard this story. Diane Black began working in health care nearly 40 years ago, but more importantly, she's now a state senator who has drafted a bill to change Tennessee's laws. She joins us now live from Nashville.

And on the phone we do have Dr. Livingston's attorney, Rob McKinney, also in Nashville. And Rob, I want to start with you. This story obviously raising a lot of controversy, making national headlines. How do you represent your client on this?

ROB MCKINNEY, DR. LIVINGSTON'S ATTORNEY (voice-over): Well, I just believe that Dr. Livingston was denied due process when he first was placed on the sex offender registry. That's the number one issue. I agree with Senator Black and some of her bill but I believe in this particular case, I want you to look behind the shocking value of the story, there's more to it.

PHILLIPS: So, Rob, how was he denied due process?

MCKINNEY: Well, basically what happened, this offense happened in 1988. And he was convicted of a misdemeanor under New York law. He disclosed that information to the Board of Medical Examiners and went about his practice until June of 2008.

At that point in time, the Tennessee Bureau of Investigation made an investigation and defined that he was a sexual offender registry. But they ignored the provisions under our code, the Tennessee Code, in which the commission of any act, on or after November 1st, 1989, constitutes the offense. It also defines what offense that triggers the sexual offender registry. And he was not convicted of anything on that list.

PHILLIPS: All right. And two things I just want to point out. That he was indicted on first-degree rape, sodomy and sexual abuse charges after at least a six-year relationship with his 15-year-old stepdaughter. And you're right. He pled guilty to a lesser charge of sexual misconduct. That became a misdemeanor. But by Tennessee law he has to register if he moves to Tennessee within 48 hours as a sex offender. Did he do that?

MCKINNEY: No, he didn't. Because he had been in Tennessee for over 18 years.

PHILLIPS: Interesting. Which brings up what happened here? Why did he get a license? Why was he living in Tennessee for 18 years and never registered as a sex offender? Senator, can you help me with that?

SEN. DIANE BLACK (R), TENNESSEE STATE SENATE: Well, this was all brought to light just recently by one of our investigative reporters here in middle Tennessee, in Nashville. When I received this information, what I found was there didn't seem to be a good connection between the sex offender registry at the TBI and our Board of Medical Examiners, nor our health-related boards.

So there is a lot to this case as has already been said. And still a lot that I'm understanding and digging into. Because obviously this goes back a way. Since we have changed our law, our law now requires since the year of 2005 after Dr. Livingston came here to our state, that there would be criminal background checks.

And so we do those criminal background checks now. But knowing that there was a doctor who was on the sex offender registry and that information was not known by the Board of Medical Examiners nor the health-related boards was concerning to me. And my bill now is going to require that any time someone is on the sex offender registry, that information will then also be sent to our health-related boards so that we'll be sure that they have that information in a timely manner.

In addition to that, my bill also requires that there would be a revocation of a license of a doctor if they are a violent sex offender. And that there wouldn't be, of course, they have a due process in the accusation in the charges. But if they are then found guilty that there wouldn't be a lot of discussion about whether that doctor should be practicing here in our state and that that doctor would have their license revoked.

PHILLIPS: And when it comes to a practicing doctor, a doctor that is going to be treating our children, a doctor that was indicted for raping a little girl, I mean, and if he's been living in Tennessee and he was given a medical license by the board there in Tennessee, I mean, you can't count on these guys to register even though the law says they need to register. There's got to be better checks and balances.

What are you going to do to make sure that this doesn't happen again?

BLACK: Well, I think, first of all, as I've already said, we do criminal background checks now. We don't depend upon someone requesting or applying for a license to tell us whether there's a problem. That is automatically done. And that is provided for in the law. And I was one of the people that helped to sponsor that legislation. So now, we do have -

PHILLIPS: So, senator, where was the background check, though, on Dr. Livingston?

BLACK: Well, Dr. Livingston came to our state before we had that 2005 law. And so there was not a law requiring a background check at the time that he came to the state. We do now require background checks. And these are criminal background checks which would make sure that we would be looking at their practice in every state or any sort of criminal background that they had have in every state in the union.

PHILLIPS: Got it. So Rob McKinney, what is Dr. David Livingston going to do now?

MCKINNEY: Well, we have appealed the chancellor's decision about his having to be on the sex offender registry. Our brief is due sometime this month. And I hope the Court of Appeals reverses the decision.

PHILLIPS: Rob, would you send your kids to your client as a doctor?

MCKINNEY: He's probably too far away from my house to do it. We like to keep it close by.

PHILLIPS: So you wouldn't feel very comfortable?

MCKINNEY: Well, I feel comfortable with Dr. Livingston treating my family or anybody else's family. I don't think there's been any allegations at the board or any place else that I'm aware of that's said he's unfit to practice medicine.

PHILLIPS: Senator Diane Black, final thought. Apparently there are other doctors practicing that are registered sex offenders. What can you do right now to tell your constituents that - what they need to do? If they are going to see the doctor tomorrow, how can they make sure that they are not going to see someone who's been convicted of a sexual crime?

BLACK: Well, first of all, we do have a sex offender registry. And I would encourage people that have a concern to get on that sex offender registry and make sure that someone that they're going to see, whether that is someone that they're going to do business with as a physician or any other kind of business.

Because I'm very proud that here in the state of Tennessee, we do have a sex offender registry that's easy to access and very easy to find out information. And so I would encourage people to on a regular basis look at who is on the sex offender registry. For many reasons - if I have a sex offender in my neighborhood, obviously I don't want to have my child either visit their house or maybe to have that person maybe coming and taking care of my children. So I encourage people to look on that sex offender registry. It's there for a reason. That's to help the public to be able to keep their children safe and for them to have the knowledge that they need to have.

PHILLIPS: We do need to be proactive. Senator Diane Black, we'll follow-up with regard to your efforts. Rob McKinney, appreciate you calling in.

MCKINNEY: Thank you very much.

PHILLIPS: Well, adjusting your sleep to your age. A new study looks at just how much we need as we get older. Let me tell you, it's never enough.

(COMMERCIAL BREAK)

PHILLIPS: Top stories now.

A massive bloodletting on the U.S.-Mexican border. Police in Juarez say at least 13 people are dead, another 13 wounded in another late night shootout Saturday at this home. Police say as many as 15 gunmen stormed a residence where a party was going on. Some speculated the massacre could reignite the cartel wars of Juarez.

British husband and wife say they're dead if the government doesn't do anything and do something fast. Pirates boarded Paul and Rachel Chandler's small yacht off the African coast, all the way back in October. The Chandlers say their captors could kill them pretty much any day now. The two have been separated from each other since they became hostages. The pirates say, "we'll release the Chandlers for a ransom or a swap of captured pirates."

U.S. Defense Department blaming faulty radar for last night's failed test of a long-range defense missile. It missed its target over the Pacific. An extensive investigation will be done to figure out what exactly went wrong.

So how much sleep do you need? No matter what, it never seems like it's enough. But a new study from England says that age has a lot to do with it. But not how you might think. Here's the numbers. Healthy adults between 20 and 30 years old sleep 7.2 hours a night. Ages 40 to 45 needed 23 minutes less. Taking off another 20 minutes for people between the ages of 66 and 83.

A major swing in the fight for civil rights. But no punches thrown. Just a sit-in that attracted the nation's attention. Now 50 years later, where do we stand?

Plus, you're looking at a live picture now from Washington where the President is set to comment on his new budget this morning. It was released just a few minutes ago. The proposals add up to more than $3.8 trillion. The President is scheduled to speak later this hour, 10:45 Eastern. We'll take it live.

(COMMERCIAL BREAK)

PHILLIPS: All right. Double whammy for you here. You can see where the president of the United States is going to step up to the mike. That's going to happen about 2:45 Eastern time.

Then just below that, those are our hard working folks. Best political team on television, by the way, there in our D.C. bureau. We've actually worked up a Budget Desk there. And believe it or not, our folks from the White House to the Capitol to right there in our NEWSROOM sorting through the proposals that the president just released a few minutes ago. We're talking about more than up to $3.8 trillion of the budget this morning.

So, what does that mean? Well, it's your money. How is it going to be spent? What programs will be frozen? What kind of jobs are going to be created? That's what we are reading through right now to try and bring you as many details as possible. The president is scheduled to speak later this hour, 10:45 Eastern time. We will take it live with the help of getting through that budget with our folks there in D.C.

Also Suzanne Malveaux at the White House and our Brianna Keilar on Capitol Hill. Stay with us. Got a lot more for you.

(COMMERCIAL BREAK)

PHILLIPS: A major step forward in the civil rights movement happened 50 years ago today. The place? Greensboro, North Carolina. These four African-American men took their seats at the lunch counter at Woolworth's. It was for whites only, but they stayed. Hundreds of people soon joined them and the sit-in spread to other cities across the South.

Here's the scene from earlier this morning. Thousands of people gathered to see the lunch counter immortalized as a museum. It's also immortalized in the fabric of this nation and in the men who started that movement.

(BEGIN VIDEO CLIP)

MAJ. GEN. JOSEPH MCNEIL (RET.), PARTICIPATED IN 1960 SIT-IN: We felt very strongly about what we were doing. And we were serious. To defy a law like segregation meant we had to have very strong convictions. So, we were hopeful that we would be able to make others aware of the evils of segregation. While were hopeful that others would follow us, we weren't exactly sure that would happen.

(END VIDEO CLIP)

PHILLIPS: Fast forward 50 years, and really, where do we stand? Last week, we actually told you about racist graffiti and threats at an Ohio college. Some students so scared, they quit school. Then there's the controversy over Senator Harry Reid's comments, saying then-presidential candidate Barack Obama didn't speak in a, quote, "Negro dialect." Meaning it as a compliment, by the way. And what about the beer summit? A white cop and African-American university professor at the center of that one.

Representative John Lewis was one of the pioneers of the civil rights movement. He joins us from a high school in Atlanta, Georgia. Don't mind the glitch. We're working on that. Eddy Glaude, J., professor of religion at Princeton University's Center for African- American studies. And Dayo Olopade is Washington correspondent for theroot.com.

You know, Dayo, let's start with you. You are in your 20s, right? 20-what? 21?

DAYO OLOPADE, WASHINGTON CORRESPONDENT, THEROOT.COM: I'm 24.

PHILLIPS: Twenty-four. Okay. So let me ask you, we're going to kind of have a generation feel here. As a 24-year-old, you see the Woolworth counter, and remember the sit-in from 50 years ago which you remember, of course, by learning in school. What does that mean to you?

OLOPADE: Well, I think the key takeaway from what happened in Greensboro and what continued to happen throughout the rest of the 60s and 07s is that the methods were as important as the message. The message of nonviolence was crucial to getting public attention all over the world for the movement that culminated in a number of different rights and protections.

To my generation, I think the most important part of the civil rights legacies is now these protections created rights for women, for immigrants, for other minorities, for gay and lesbian Americans. It's about building upon that past and sort of seeing the ways that we now have an expanded vision of equality in America because of the work that went on back in 1960.

PHILLIPS: All right. So, pick one adjective for me. When you see that picture of that sit-in at the Woolworth counter, if you were to pick one word, how does it make you feel?

OLOPADE: You know, it feels like righteous, I guess. I think -- I feel proud.

PHILLIPS: Okay. Proud. Let's hold on to that. Proud. Eddie, let's go to you. You're 41, right?

EDDIE GLAUDE JR., PH.D, PRINCETON UNIVERSITY: Right.

PHILLIPS: Okay. A young 41.

GLAUDE: A young 41, right?

PHILLIPS: When you look at that picture of those four gentlemen at the Woolworth counter and you remember what happened 50 years ago, what does that mean to you?

GLAUDE: Well, it suggests to me the enormous power of young people. When we think about those four young men, they're college freshman. They're 18 years old. I've seen 18-year-old students in my classroom. They are pretty much babies.

So, what I see is the kind of enormous demonstration of courage and the power of young people to be transforming agents in the world. So, when I look at February 1st, 1960, I see four college freshmen, young men, at North Carolina deciding to fundamentally impact their circumstances. And in doing so, impact the country and impacting the country, impacting the world. So, I see courage in the power of young people. It's a fascinating and extraordinary moment.

PHILLIPS: Congressman Lewis, this is your time. You were a huge, vital part of this moment. When you see that picture 50 years later, what does it mean to you?

REP. JOHN LEWIS (D), GEORGIA : It means so much to me. I can remember so well 50 years ago, February 1st, I was only 19. Almost 20. I was so inspired. We had been studying philosophy and the discipline of nonviolence as students. A few days later, we started sitting in all across the American South. The sit-ins spread like wildfire.

These four young men by sitting down, they inspired an entire nation, an entire generation to stand up. You'd be sitting there in an orderly, peaceful, nonviolent fashion waiting to be served. And someone would come up and spit on you or put a lighted cigarette out in your hair or down your back. Pull you off the lunch counter stool.

I remember, like so many other young students getting arrested, being beaten, and taken to jail. But we believed in the philosophy and the discipline of nonviolence. We changed America forever.

PHILLIPS: John Lewis, you lived it. You were a part of it. As you listen to Dayo, a young gal, 24 years old, a journalist, a strong African-American woman, what do you -- how do you want her to carry what that moment meant for you? How does she go on from generation to generation so that nobody forgets that day?

LEWIS: I think it's important for her and for her generation to continue to be inspired by what happened 50 years ago, but continue to tell the story so generations yet unborn will know what happened and how it happened to pick up where we left off.

PHILLIPS: Eddie, how do we keep that power, as you say, going when our dear John Lewis won't be with us, you know, for the next 50 years? How do you continue to carry what he represents and what he felt?

GLAUDE: Well, not only should we tell the story, we should listen and learn its lessons. But one of the things that's really demonstrated by the power of the courage and sacrifice of John Lewis and Julian Bond and Marion Barry and Ruby Doris Smith and Diane Nash, all those young folks who risked their lives as the shock troops of the civil rights movement, they dared to imagine their own role.

See, we can't allow our imaginations to be captured by the moment, the heroism, of the 60s and 70s. We have to understand that our moment demands of us a specific and creative response. So, we have to stand in that tradition. Give voice to the uniqueness of our own situation and create and act in relation to our own commitment and contribution to the struggle of freedom.

In other words, what we have to do is stand in our moment and offer a unique response. Not be nostalgic. Not try to duplicate what has been done in the past. But to understand that we're charged to speak to the moment in which we now live. That could be the best tribute to the legacy of those sacrificed in the '60s.

PHILLIPS: Well, we couldn't find a more perfect transition to the first African-American president of the United States, Barack Obama, talking about the budget today.

(JOINED IN PROGRESS)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Now, the fact is, 10 years ago we had a budget surplus of more than $200 billion, with projected surpluses stretching out toward the horizon.

Yet, over the course of the past 10 years, the previous administration and previous Congresses created an expensive new drug program, passed massive tax cuts for the wealthy, and funded two wars without paying for any of it, all of which was compounded by recession and by rising health care costs.

As a result, when I first walked through the door, the deficit stood at $1.3 trillion, with projected deficits of $8 trillion over the next decade.

Now, if we had taken office during ordinary times, we would have started to bring down these deficits immediately. But one year ago, our country was in crisis: We were losing nearly 700,000 jobs each month, the economy was in a free fall and the financial system was near collapse. Many feared another Great Depression.

So we initiated a rescue, and that rescue was not without significant costs. It added to the deficit as well.

One year later, because of the steps we've taken, we're in a very different place. But we can't simply move beyond this crisis; we have to address the irresponsibility that led to it, and that includes the failure to rein in spending, as well as reliance on borrowing, from Wall Street to Washington to Main Street, to fuel our growth.

That's what we have to change. We have to do what families across America are doing: save where we can so that we can afford what we need.

Now, I think it's very important to understand, we won't be able to bring down this deficit overnight given that the recovery is still taking hold and families across the country still need help.

We will continue, for example, to do what it takes to create jobs. That's reflected in my budget. It's essential. The budget includes new tax cuts for people who invest in small businesses, tax credits for small businesses that hire new workers, investments that will create jobs repairing roads and bridges, and tax breaks for retrofitting homes to save energy.

We also continue to lay a new foundation for lasting growth, which is essential as well. Just as it would be a terrible mistake to borrow against our children's future to pay our way today, it would be equally wrong to neglect their future by failing to invest in areas that will determine our economic success in this new century.

That's why we build on the largest investment in clean energy in history, as well as increase investment in scientific research, so that we are fostering the industries and jobs of the future right herein America.

That's why I've proposed a more than 6 percent increase in funding for the Education Department. And this funding is tied to reforms that raise student achievement, inspire students to excel in math and science, and turn around failing schools which consign too many young people to a lesser future, because in the 21st century there is no better anti-poverty program than a world-class education.

And that's why we eliminate a wasteful subsidy to banks that lend to college students and use that money to revitalize community colleges and make college more affordable.

This will help us reach the goal I've set for America: By 2020,we will once again have the highest proportion of college graduates in the world.

And these are the investments we must make to create jobs and opportunity now and in the future. And in a departure from the way business has been done in Washington, we actually show how we pay for these investments, while putting our country on a more fiscally sustainable path.

I've proposed a freeze in government spending for three years. This won't apply to the benefits folks get through Social Security, Medicaid or Medicare. And it won't apply to our national security, including benefits for veterans. But it will apply to all other discretionary government programs.

And we're not simply photocopying last year's budget. Freezing spending does not mean we won't cut what doesn't work to pay for what does.

We've gone through every department's spending line by line, item by item, looking for inefficiency, duplication and programs that have outlived their usefulness. That's how we freeze discretionary spending.

Last year we found $17 billion in cuts. This year, we've already found $20 billion.

Now, some of these cuts are just common sense. For example, we cut $115 million from a program that pays states to clean up mines that have already been cleaned up. We're also cutting a Forest Service economic development program that strayed so far from any mission that it funded a music festival. And we're saving $20 million by stopping the refurbishment of a Department of Energy science center that the Department of Energy does not want to refurbish.

Other cuts, though, are more painful because the goals of the underlying programs are worthy.

We eliminate one program that provides grants to do environmental clean-up of abandoned buildings. That's a mission I support but there are other sources of private and public funds to achieve it.

We also eliminated a $120 million program that allows folks to get their Earned Income Tax Credit in advance. I am a big supporter of the Earned Income Tax Credit. The problem is 80 percent of people who got this advance didn't comply with one or more of the program's requirements.

So I'm willing to reduce waste in programs I care about, and I'm asking members of Congress to do the same.

I'm asking Republicans and Democrats alike to take a fresh look at programs they've supported in the past to see what's working and what's not, and trim back accordingly.

Like any business, we're also looking for ways to get more bang for our buck by promoting innovation and cutting red tape.

For example, we consolidate 38 separate education programs into 11. And last fall we launched the SAVE Awards to solicit ideas from federal employees about how to make government more efficient and more effective. I'm proud to say that a number of these ideas, like allowing Social Security appointments to be made online, made it into our budget.

I also want to note, even though the Department of Defense is exempt from the budget freeze, it's not exempt from budget commonsense. It's not exempt from looking for savings.

We save money by eliminating unnecessary defense programs that do nothing to keep us safe. One example is the $2.5 billion that we're spending to build C-17 transport aircraft. Four years ago, the Defense Department decided to cease production because it had acquired the number requested, 180. Yet every year since, Congress has provided unrequested money for more C-17s that the Pentagon doesn't want to need. It's waste, pure and simple.

And there are other steps we're taking to rein in deficits.

I proposed a fee on big banks to pay back taxpayers for the bailout. We're reforming the way contracts are awarded to save taxpayers billions of dollars. And while we extend middle-class tax cuts in this budget, we will not continue costly tax cuts for oil companies, investment fund managers and those making over $250,000 a year. We just can't afford it.

Finally, changing spending as usual depends on changing politics as usual. That's why I've proposed a bipartisan fiscal commission, a panel of Democrats and Republicans, who would hammer out concrete deficit-reduction proposals over the medium and long term, but would come up with those answers by a certain deadline.

I should point out, by the way, that is an idea that had strong bipartisan support and was originally introduced by Senators Gregg on the Republican side and Conrad on the Democratic side, had a lot of Republican cosponsors to the idea.

I hope that -- despite the fact that it got voted down in the Senate, that both the Republican leader, Mitch McConnell, and the Republican leader in the House, John Boehner, go ahead and fully embrace what has been a bipartisan idea to get our arms around this budget.

That's also why we're restoring pay-as-you-go, a simple rule that says Congress can't spend a dime without cutting a dime elsewhere. This rule helped lead to the budget surpluses of the 1990s, and it's one of the most important steps we can take to restore fiscal discipline in Washington.

Now, you can read more about the budget at budget.gov -- very easy to remember: budget.gov.

But the bottom line is this: We simply cannot continue to spend as if deficits don't have consequences, as if waste doesn't matter, as if the hard-earned tax dollars of the American people can be treated like Monopoly money, as if we can ignore this challenge for another generation.

We can't.

In order to meet this challenge, I welcome any idea, from Democrats and Republicans. What I will not welcome -- what I reject-- is the same old grandstanding when the cameras are on and the same irresponsible budget policies when the cameras are off.

It's time to hold Washington to the same standards families and businesses hold themselves. It's time to save what we can, spend what we must and live within our means once again.

Thanks very much.

PHILLIPS: Okay. President Obama and his newly unveiled budget, even before it was released earlier this hour, though, the critics were already tearing right into it.

So, how is the sales job? CNN senior political correspondent Candy Crowley joining us now. What do you think, Candy?

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: What's interesting about budgets -- and your eyes can glaze over at figures and programs are being cut that you never heard of and talk of deficit commissions -- but budgets are where the power is. This will be as budgets always are a titanic struggle. Basically, when you look at the two parties, it gets down to how big a role do you want the government to play? How important do you think the deficit is right this moment? How much do you believe the budget forecast in terms of how much the economy will improve? And what do you want to spend your money on?

There's nothing more fundamental to governing than how are you going to spend your money. And this is certainly a budget that's going to reflect the president's priorities. Because despite the talk of a freeze on discretionary spending -- and that is things that are not mandated by law, for instance, Social Security, Medicare, Medicaid, none of that will be touched because that's mandated by law. But then you have other things. Education Department budget, Health and Human services, EPA.

But when you look at education, the president will be investing more in certain programs in the Education Department. He will be investing more in civilian research.

So despite the freeze, it is kind of a strategic freeze in places. So, you will see his priorities. You will also see the Republicans who already in advance, as you noted, have said, listen, this is not enough deficit reduction. It is -- he will propose, in fact, the highest deficit for the next couple of years or in the order of $1.6 trillion. You heard him say that he inherited much of that.

Nonetheless, this has become a very potent political issue as we see more and more Americans saying I'm really worried about the kind of money we're spending. You have seen the president's priorities here, but you have also seen what essentially is the key political document of the year around which Congress and all politicians will spend much of their time arguing.

PHILLIPS: One hundred billion bucks spent on creating jobs. Right now, if you were to ask the average American, what do you want, it would be a job.

CROWLEY: And that's exactly where his balance has to come in. Because he's hearing all of this talk about deficit reduction, we're spending too much money. At the same time, everyone says in the middle of a jobs crisis, you don't stop spending money. You pump money into the economy. So, somewhere in there, he has to find the sweet spot.

PHILLIPS: And the sweet spot for you is going to be Sunday mornings now. Is this the perfect opportunity to brag to the entire world that our Candy Crowley -- got to love it, the only, the first, the best woman on the news programs on Sunday mornings, "STATE OF THE UNION" with Candy Crowley. Anything you want to tell us?

CROWLEY: I'm -- well, you know, I think the 4:30 a.m. wake-up call will be certainly a challenge. The sweet spot for me is always talking to you, Kyra, you know that. But I think it'll be fun. There have been women before me, in fact, that have done the Sunday morning talk shows. Cokie Robertson, Lesley Stahl had a stint. At the moment there are no females out there. I know we'll see plenty in the years to come. But what can I tell you? I'm excited.

PHILLIPS: And so are we. Congratulations. I look forward to Sunday mornings.

All right. Candy Crowley.

We're going to take a quick break. More from the CNN NEWSROOM straight ahead.

(COMMERCIAL BREAK)

PHILLIPS: Top stories.

A female suicide bomber killed at least 41 people, injured more than 100 more in northeastern Baghdad today. The target? Shiite Muslim pilgrims planning to mark a holy day. There have been several attacks on Shiite pilgrims in the past few days.

Seven deaths blamed on strong winter storms across Oklahoma. Crews working overtime to try and get the power back on. Right now, more than 70,000 people still without electricity, and for many, that means no heat.

It was ladies night at the Grammys. Someone get Beyonce a wheelbarrow for all her trophies.

(VIDEO CLIP)

PHILLIPS: Oh, yes. "Single Ladies" earned her multiple Grammys. It's the Song of the Year. Beyonce won six Grammys in all, a record haul for one woman on one Grammy night.

(VIDEO CLIP)

PHILLIPS: And Taylor Swift wasn't far behind. She grabbed four Grammys, including the jewel of them all, Album of the Year.

(COMMERCIAL BREAK)

PHILLIPS: That does it for us. We'll see you back here bright and early tomorrow morning. Betty Nguyen in for Tony Harris today. Betty?