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Stimulus Enters Second Year; Study Suggests Aspirin Beneficial for Breast Cancer Patients; Is Merit Pay for Teachers a Viable Idea?

Aired February 17, 2010 - 13:00   ET

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

TONY HARRIS, CNN ANCHOR: All right. CNN NEWSROOM continues right now with Ali Velshi!

ALI VELSHI, CNN ANCHOR: Tony, thank you so much.

I am Ali Velshi. And I'm here for the next two hours, today and every day, to help you break things down, to help you understand a little better those things that will make you smarter about decisions that you have to make with respect to money, with respect to your safety and security. And boy, do I have my work cut out for me today.

Here's what I've got on the rundown, the White House war room is packed today, as President Obama huddles with his top advisors. Certain to be on his agenda, the massive anti-tall ban offensive in southern Afghanistan and the arrest of the Taliban's military leader.

Well, next time you're at the airport, you might hear this: "Put your palms forward, please." The TSA plans to start randomly swabbing passengers' hands at checkpoints and gates to test for bomb traces.

And topping our rundown today, it's the anniversary of the economic stimulus plan. And one year in, it's just as controversial as ever. We're looking back, looking ahead. And, most importantly, as always, we're breaking it down for you.

Welcome to year two of the American Recovery and Reinvestment Act, better known to most people as the stimulus. It was one year ago today that President Obama signed a multiyear package of federal spending and tax breaks, aimed at steering the economy away from a terrifying cliff. The price tag was pegged at $787 billion, but recently, the nonpartisan Congressional Budget Office upped its estimate of the cost to $862 billion. The White House is sticking with the lower figure, however.

Either way, most of the money hasn't been spent. As of January 30, roughly $298 billion had gone out: $179 billion in checks, $119 billion in tax cuts. To date, only $31 billion has gone to what you might think of as stimulus projects. Those physical projects: building of roads, bridges, broadband installations, energy, and education.

But enough with the numbers. I want to break down the impact, the fallout, the prospect of recovery and reinvestment with some very smart people. Leigh Gallagher is the assistant managing editor of "Fortune" magazine. She's in New York. In Washington, Andrew Roth joins me. He is with the fiscally-conservative Club for Growth.

And let's start with you. Are you -- are you celebrating? Do you have a cake there to celebrate the first birthday of the stimulus bill?

ANDREW ROTH, CLUB FOR GROWTH: No, I'm not. The stimulus clearly hasn't worked. You know, the unemployment is at 9.7. The White House themselves said that the stimulus would bring the unemployment rate to anywhere between 7.5 percent and 8 percent, so it's clearly above their projections.

Democrat Senator Evan Bayh, who you know announced his retirement the other day, says that Congress hasn't created one job in the last six months. So, I think it's a failure. We need to do something more pro-growth, and this isn't it.

VELSHI: Leigh Gallagher, at the White House, we'll be talking to Jared Bernstein in just a moment about what the White House. Let me go back to Andrew for a second.

Andrew, it's sort of tough to -- to parse this, because the reality is, the White House makes the argument that many jobs have been saved that wouldn't have been saved. And many private sector economists make the same case. I mean, do you think that the money that's not spent should be spent differently at this point?

ROTH: Oh, absolutely. In fact, the quickest way we can, you know, boost the recovery is to cut taxes. Our economy is based on capital and labor. And the way to get more capital and more labor is to cut the capital gains tax rate on capital and to cut taxes on labor, like income taxes and the payroll tax.

And rather than trickle that money over several months or seven years like the current stimulus plan is, when you cut tax rates, broad-based tax cuts, you can adjust those quickly, and they'll be felt the very next day.

VELSHI: Leigh Gallagher, assistant managing editor at "Fortune," you've been following this. We've been following this together over the last year. What's the evaluation once you've taken stock of everybody's perspective on this? What's the evaluation, a year into the stimulus bill?

LEIGH GALLAGHER, "FORTUNE": Well, you know, the hard thing about talking about the stimulus, it's very hard to talk about hypothetically what might have happened if we didn't have the stimulus. This is a very hard thing for people to understand.

You know, the consensus seems to be that this has helped, this has definitely, net-net, helped the economy.

I mean, another problem is that the predictions way back when were, you know, a little bit rosier than they probably should have been, and so things are actually worse than everyone thought it would be. But I think there's no doubt that it's added jobs and that it's helped. And some of the stimulus did go to tax cuts, but the problem with that is that people tend to save them, and so you don't necessarily get the spending on the ground in, you know, metrics like consumer spending.

VELSHI: I see Andrew chomping at the bit here.

ROTH: Yes. Actually, the stimulus has -- has actually exacerbated the recession, and the reason why is part of the stimulus plan extended unemployment benefits. Now, think how nonsensical that is. The stimulus was about creating jobs, and yet it's using $40 billion to incentivize people not to get a job.

VELSHI: Well, come on, Andrew. You can't -- you can't really mean that, right? Unemployment benefits incentivize people to stay home? I mean, I'm the host on the show, but I've got to tell you, that just sounds ridiculous.

ROTH: If you get 60 percent of your wages for free without doing anything.

VELSHI: There are millions of people here trying to get work in this country. Are you telling me that they're not going to work because they're getting an unemployment check?

ROTH: Well, unemployment, when you get money to not work, that creates an incentive to not work. So that's not a stimulative idea.

GALLAGHER: But, Andrew, there aren't jobs out there.

ROTH: Well, I know, and we can create jobs...

GALLAGHER: Unemployment...

ROTH: ... quite easily. I mean, all we have to do is...

GALLAGHER: Unemployment...

VELSHI: This is what we're here for. This is what we're here for. There's a way to create jobs quite easily. Spell it out. Write the prescription right here on this show.

GALLAGHER: I mean, many people say that...

ROTH: Listen, people -- businesses need money for capital, and they need to hire. And all you to have do is cut the payroll tax so it's cheaper to get jobs. It's cheaper to hire people. It's cheaper to build factories. You do that by making capital and labor cheap.

VELSHI: All right. Hold onto your thoughts for just a second. This is an interesting discussion. I'm going to pick it up on the other side with Leigh Gallagher and Andrew Roth. Leigh Gallagher is the assistant managing editor of "Fortune" magazine. Andrew is the vice president of government affairs for the Club for Growth, the conservative Club for Growth. We're going to talk about the prescriptions for actually making things better in this economy when we come back.

(COMMERCIAL BREAK)

VELSHI: OK. We're continuing our discussion. It's the first anniversary of the signing of the stimulus bill. "Fortune" magazine's assistant managing editor, Leigh Gallagher, and Andrew Roth of the fiscally-conservative Club for Growth are joining me now with this conversation.

I want to show you both -- I know you're both very familiar with this, but this is the picture of job losses since January of 2009. By the way, this is all the way through to 2010. This is all of last year's job losses. And you can see we lost jobs all through 2008, as well.

With 8 million-plus people unemployed as a result of this recession, we all -- I know people -- they're my friends in many cases. There are people I know. We all know somebody who's lost a job involuntary.

So I want to go back to you, Andrew, for a second. Because you feel like the extension of unemployment benefits under the stimulus act encourages people who are out of work to stay home. I'm going to say to you that I think that's a little outrageous. Did you mean that?

ROTH: Yes, I do. And I'll back that up even more. Listen, economists talk about what happens on the margin, what -- what happens when you put any kind of bill into place. It certainly doesn't encourage them to get a job when you extend unemployment benefits. The way to create a job is to actually force them to go out and look for jobs or have a lot of employers come and seek them and ask if they can be hired.

VELSHI: OK. So, Leigh, let's have this situation, where we do what Andrew says. We pull back on these unemployment benefits for those 15 million plus people who are out of work right now...

ROTH: Which is what we want them to do right now.

VELSHI: And we force them to go out and look for jobs. What -- fill in the rest of this for me.

GALLAGHER: Well, what happens then is you have people slip into poverty who were just above the poverty line, because they have families and they can't make things happen, and there aren't jobs. For every single job there's something like -- I don't know -- last count, seven, eight, nine...

VELSHI: Yes.

GALLAGHER: ... unemployed people. So, you know, you've got people slipping into poverty where they wouldn't have in a normal economy. And there are studies that show once that happens, their children are more likely to grow up into poverty. It just sets off an enormous ripple effect. I mean, this is not a normal recession... ROTH: I'm not saying that the way to stimulate the economy is to stop unemployment benefits. I'm saying stop unemployment benefits and let's extend some broad-based tax cuts. These people will get jobs if companies have an incentive to hire, and you do that by cutting taxes.

VELSHI: Who do you want to cut taxes...

GALLAGHER: I don't think it's a one-step solution.

VELSHI: I think that's probably true. Do you agree with that, Andrew, or do you think it is that simple?

ROTH: Well, look at it this way. The stimulus is a big $800 billion honey pot where politicians and bureaucrats and lobbyists get to decide who the winners and losers are. It's all a big fight over where the money goes.

With tax cuts, broad-based tax cuts, everybody gets to keep more money, and there's no worries about lobbyists trying to fight for their slice of the pie. It's not a command-and-control economy. It's people getting to use their own money and having more of it.

VELSHI: Leigh, what...

ROTH: That's how you stimulate the economy.

VELSHI: What's worked so far, as far as you see, in the stimulus bill?

GALLAGHER: Well, you know, I think that if you look at a program like cash for clunkers, you could argue that that definitely worked. Some people may say that those were people who were going to buy cars anyway, but the whole point of the stimulus bill is that we needed people to buy those cars then. This was last summer. So, I think that was definitely a success.

There are jobs being created on the ground. I mean, the stimulus is such a massive project, that nobody is following the bit by bit, you know, the jobs that are created in Mississippi, the jobs you know, in the project in California. I mean, that's happening now and it's going to continue to happen.

I mean, a lot of the stimulus can't fairly be judged for several years. A lot of these projects take a long time to get off the ground, which could be a criticism of the stimulus. That we may be needed more things to happen last summer.

Roth: Absolutely.

GALLAGHER: So -- but I do still think -- don't -- unemployment is -- it crept down a teeny little bit, but we don't know what's going to happen next month. I mean, it's at crisis level. Nobody can argue with that.

ROTH: You cut taxes today, those tax rates go into effect tomorrow. The stimulus is abrupt and right away. With the stimulus plan that we have now, it just drags on for months and months, exacerbating the problem.

VELSHI: All right, Andrew, thanks very much for joining us. Andrew Roth is with Club for Growth, joining me from Washington. Leigh Gallagher from "Fortune," thanks very much for joining us. We'll continue this conversation.

We are sticking on it, particularly with our stimulus desk, where we're calling recipients of that money and finding out where jobs have been created.

Let me bring you up to speed on some headlines right now. Those Americans detained in Haiti are expecting some news today. We're on that story. We've got our people on the ground there. The latest from Port-au-Prince in just a minute.

(COMMERCIAL BREAK)

VELSHI: French leader gets a first look at Haiti and vice versa. Checking the situation out in Port-au-Prince today, nearly five weeks after the earthquake. Nicolas Sarkozy's arrived for a visit, promising $400 million in aid to help the former French colony rebuild.

Interestingly, he's the only French president to set foot on Haiti since it gained independence over 200 years ago.

And those ten Americans detained at the Haitian border with a busload of kids could be released today. The judge is due to make a decision on bail. The missionaries face kidnapping charges. They say they were trying to set up an orphanage.

Meanwhile, the World Health Organizations is asking aid groups to maintain medical teams in Haiti for at least six months. Most hospitals and clinics in the capital were totally destroyed in the quake. The estimated death toll now 212,000.

All right. Checking the headlines.

Hands up. The TSA plans to start randomly swabbing people's hands at airport checkpoints and gates to check for traces of explosives. This was prompted by the attempted bombing of that Northwest Delta flight on Christmas.

At the White House today, President Obama says the stimulus plan has saved or created at least 2 million jobs and kept the U.S. out of a deeper recession. But on this one-year anniversary of the plan, he also said too many people are still out of work. We'll continue to fact-check the stimulus bill through the course of the afternoon.

And Toyota faces more safety issues. The car maker is looking into reports of steering problems on its best-selling Corolla. Toyota also says it's hiring new quality control officers, doing more testing, and talking to independent researchers to fix its wider problems.

All right. When we come back, we're going to talk to Dr. Sanjay Gupta about how aspirin might help breast cancer patients.

(COMMERCIAL BREAK)

COOPER: A new study shows that taking aspirin may prevent a recurrence of breast cancer. Dr. Sanjay Gupta has the latest on this -- Sanjay.

(BEGIN VIDEOTAPE)

SANJAY GUPTA, CNN CORRESPONDENT: Well, I love stories like this, because they're potentially so simple. Talking about aspirin, something that everyone knows, probably has in their medicine cabinet, and potentially fending off cancer, in this case breast cancer specifically.

This is part of a study, really more of an observation, looking at women who had cancer, breast cancer, who were treated for it and were now in remission. And what they found was that women who took a low-dose aspirin tended to have half as likely a chance of spreading that cancer and half as likely to die from that cancer subsequently, as well.

Now, again, this is an observation, as opposed to an actual study, meaning that they looked at people who were, you know, treated for the cancer and were in remission, but they could have had all different sorts of factors happening to them. Their diet may have changed, their lifestyle, the type of treatment they got. The aspirin itself is hard to pinpoint as the potential benefit here.

Why it may work may have to do with inflammation. We know that aspirin, for example, in the laboratory can have effects on cancer cells. It can help kill cancer cells in the laboratory, and it might be because of its impact on inflammation overall.

But it's also worth pointing out that there could be a lot of other things going on here. And this particular study, the Nurses' Health Study, has made observations which have turned out to be wrong. For example, there was a thought at one point that hormone replacement therapy could fend off heart disease. That turned out not to be true. And the same can be said of vitamin E and heart disease; also turned out not to be true.

When you're trying to figure out if something works, in this case aspirin, you have to do what's called a prospective study. You have to create two groups, a study group and a control group, and then just change one variable, in this case, aspirin. When they did that, they get some conclusive findings.

For example, with regard to heart disease, they can tell more definitively who would benefit from aspirin when it comes to heart disease. Men who are high risk, age 45 to 79, and women who are high risk, age 55 to 79. That's one of the examples of how you actually arrive at a recommended therapy.

In this case, with regard to breast cancer and aspirin, it's very exciting. I don't think anybody is ready to make a specific recommendation as of yet.

Back to you.

(END VIDEOTAPE)

VELSHI: All right, Sanjay, thank you.

And now I'm over at the weather center, severe weather center, with Chad Myers.

What do you got for us today?

CHAD MYERS, CNN METEOROLOGIST: Hey, it's warming up. You know what? People are coming to me going, "Hey, do you know what, dude? It's going to be normal."

VELSHI: High-five.

MYERS: Really? We've lowered our standards to normal.

VELSHI: Right.

MYERS: Because it's been cold across parts of the east and the southeast. That cold air finally moves out, but Punxsutawney Phil was right.

VELSHI: Right. Six more weeks.

MYERS: Winter -- winter's not over. Here it comes. It comes back.

VELSHI: I knew you had something for me.

MYERS: It comes back. Another arctic blast for the Midwest. But this is still showing that the jet stream is doing still the wrong things for the Olympics. That's going to allow, because the jet stream goes all the way down to Texas -- that's going to allow the cold air to be here. It's not allowing the cold air to be where we need it, up in Vancouver.

VELSHI: Right.

MYERS: And really, Cypress. You know, the higher-elevation ski areas are doing just fine.

VELSHI: Right. Right.

MYERS: Hundreds of inches of snow.

VELSHI: Right, right.

MYERS: It's the lower ones that just haven't been quite cold enough -- see if we can get that to move. That haven't been cold enough to get the amount of snow that we need.

VELSHI: Right. MYERS: Vancouver, Cypress and Whistler.

VELSHI: Right. Whistler's fine.

MYERS: Vancouver, literally, I mean, the hockey rink and stuff like that, but that's OK. It's 43 degrees right now, north wind at 7 miles per hour. Move up the mountain to Cypress. It's 30. That's great, but today and this afternoon it's going to be 37, 38.

VELSHI: Yes.

MYERS: They don't want 37, 38. And then Whistler Mountain, it is 21 and it was snowing all night.

VELSHI: It is -- for skiers, Whistler is a terrific place, but it gets unpredictable with respect to the weather.

MYERS: This is my favorite spot.

VELSHI: Right.

MYERS: Any mountain above...

VELSHI: We know what that is. We know it's going to be OK over there.

MYERS: But it's also above the tree line.

VELSHI: Right.

MYERS: Anywhere you want to go.

VELSHI: All right, Chad Myers.

Listen, the other day, we had a very interesting discussion with Steve Perry about the possible elimination of the 12th grade for some people in Utah, and Steve said that it's all got to do with not having merit pay for teachers and unions blocking the idea of merit pay for teachers.

So we want to have this conversation. We're bringing Steve back and Linda Pearlstein, and we're going to talk about merit pay for teachers when we come back.

(COMMERCIAL BREAK)

VELSHI: It's a debate that's been echoing through the halls of schools and Congress and state legislators -- legislatures for years: should teachers be paid based on the performance of their students? Now, there are several pros and cons. Even President Obama is weighing in.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Stop making excuses for bad ones. Let me be clear. If a teacher is given a chance or two chances or three chances but still does not improve, there's no excuse for that person to continue teaching.

(END VIDEO CLIP)

VELSHI: Joining me now is CNN education contributor Steve Perry from Rocky Hill, Connecticut, and author Linda Pearlstein from D.C.

Linda, let me start with you. You don't -- it sounded very straightforward what the president says. You think there are a lot of issues with this whole idea of spreading the notion that teachers should be paid because -- by the results -- according to the results of their students.

LINDA PEARLSTEIN, AUTHOR: I agree that bad teachers should go and good teachers should be rewarded. I'm concerned about basing that solely on the test scores of their students.

VELSHI: Steve Perry, you -- the other day we were talking about the suggestion to eliminate the 12th grade in Utah. And you said the biggest problem, the biggest impediment to quality public education right now, is teachers' unions not allowing teachers to be paid based on the performance of their students.

STEVE PERRY, CNN EDUCATION CONTRIBUTOR: What teachers unions do is they stand in the way of progress. And one of the places where progress needs to take place is we need to allow there to be a collegial relationship between the teacher and the principal, and they create what is a valued relationship. And we begin to determine their effectiveness based upon the data that appears in the classroom, and the only data that matters is the students' performance.

VELSHI: Let's talk a little bit about the idea of merit pay for teachers. This is complicated, because there are many different versions of this. Some -- some say that merit pay is just based on the -- on the test scores of the kids. Others say it's more complicated -- more complicated formula.

But let's just take a look at what the pros and cons are. The pros are that it may give teachers certain incentives to change the way they -- they teach. It could help and attract and retain quality teachers and teachers who, you know, teachers we all sort of agree are generally underpaid. It may help address this issue.

A lot of the cons are that it doesn't do anything necessarily for students and help them improve their situation. It does -- to Linda's point -- perhaps over-focus on test scores, and it does discourage teaching disadvantaged students.

And, Linda, I've seen your writing on this. You're saying that teachers are only one part of the equation of a child's success in school.

PEARLSTEIN: I think they're a huge part of the equation, but I'm not sure -- you know, Steve says it's the data that matters. It's not the only thing that matters. It's just the most easily measurable thing that matters. You need to really look at some subjective measures: whether a teacher is engaging her students, whether she's not just bringing this over this low bar of the state test, but she's really pushing them to excel to a level we're not measuring right now.

VELSHI: Steve?

PERRY: We've -- we've used those subjective measures to no avail. The economy and the colleges have spoken, and they are saying that the students that are coming out are not prepared.

So we've already tried the subjective, touchy-feely, are your students engaged approaches. We need some hardcore evidence to prove that teachers, whose job it is to teach -- implicit in that is that children learn -- are measured based upon that which they do. Teachers and principals. We all should be measured based upon the product. And our product is an educated person.

VELSHI: We've been doing...

PERRY: And we've been...

VELSHI: Steve, we've been trying to do digging into this and trying to get smarter about this whole thing. I looked at one study by the University of Arkansas in 2007 where teachers were given performance pay in the Little Rock School district. The conclusion they came to was that merit pay does increase academic proficiency.

We've taken two examples, another one was one from Texas. Researchers at Vanderbilt, Texas A&M and the University of Missouri, concluded in an autumn 2009 study that there is no systematic evidence that the Texas Educator Excellence grant had an impact on student achievement gains. And this was $300 million spent in Texas over the last three years on a merit pay program that hasn't worked.

So, I couldn't deem from the evidence, Linda, one way or the other, which one works. What do you lean on to say that you don't think that what Steve is suggesting is the answer?

LINDA PERLSTEIN, AUTHOR: Well, I'm saying that it's not the only answer. And I'm saying that we don't know -- the evidence is not conclusive, whether it's going to attract the best teachers and whether it's going to improve student achievement. What we have now isn't great either, paying teachers based on how long they've been around.

VELSHI: What's your suggestion?

PERLSTEIN: I would like to look at -- I don't have a problem with having principals and others make judgments about whether teachers are engaging students. We haven't factored that in to teacher pay ever before. And the unions have actually fought that, because they say that could be unfair.

The rest of us are judged by how well we do our jobs by many measures, not necessarily quantitative, and I think teaching should be the same.

VELSHI: So, I guess the one thing you guys agree on is in some cases the unions have stood in the way of progress in determining how teachers should be paid.

PERRY: Absolutely.

PERLSTEIN: Yes.

PERRY: One of the things that unions do is they have convinced teachers that they are needed in order to negotiate their pay. This collective bargaining that everyone should be paid exactly the same amount of money -- it goes beyond socialist into communist approach to education -- that the only distinguishing factors is how many years you've been in the profession. And how many credits you have. Not your effectiveness in the classroom.

And there's other research out there, Ali, that speaks to a different part of this. And that research says that there's a greater disparity -- within a school, meaning between effective teachers and ineffective teachers than between schools.

So, we know that teachers matter. So, when we can have access to good teachers, we know it improves student performance. It doesn't mean that money motivates people, and I want to make that clear. Money doesn't have to be the motivator, but what it can do is say to a particular teacher we want you to come teach math in our district and we can offer you incentives, which currently under collective bargaining cannot be done. So, areas that are hard to fill could be filled when we can provide incentives.

You both come back, and we'll continue this conversation, because I think this is an important conversation that I think a great deal of the nation's attention has to focus on as we try to rebuild the economy in this country. Steve Perry is a CNN education contributor, and Linda Pearlstein is an author joining us from D.C. She's a specialist in these areas. Thanks to both of you for joining us.

When we come back, the Dalai Lama is meeting with the president of the United States. China is not happy about this at all. You want to know why this matters? We'll tell you when we come back.

(COMMERCIAL BREAK)

VELSHI: He was cheated out of a million dollar lottery ticket, and now a Texas man is getting some of his money back. This guy has the best name ever. Willis Willis. He turned the million-dollar ticket into a store clerk in Austin. The clerk, Pankaj Joshi, is accused of telling Willis Willis that the ticket was not a winner and then cashing in the ticket himself.

Get this. Authorities believe this guy, Pankaj Joshi, the guy you are looking at, then ran off to his native Nepal with the cash. Authorities haven't got him yet, but they've frozen some of the money. They've recovered nearly $400,000 of the winnings. They presented that money to Willis Willis, and he is reportedly going to use it to pay off some medical bills, college tuition for one of his six daughters and buy himself some new golf clubs.

Okay, so the hunt is still on for the store clerk who is in Nepal. Let's stay in the Himalayas while we're talking about this, and let's go to Tibet which we're going to talk about next. As you know, the Dalai Lama is based out of Tibet. He's scheduled to meet with President Obama in the White House, you see china next to Tibet.

We want to dig in to why this meeting is so controversial. First of all, China is not at all pleased with the president's decision to meet with the Tibetan Buddhist leader. For centuries, the fight has continued in China and Tibet as to who controls Tibet. Beijing accuses the Dalai Lama of advocating Tibetan independence from China.

Right now, Tibet is internationally regarded as autonomous, or independent, from the central Chinese government. Several times over the years, Tibet has closed its borders to foreigners. The Dalai Lama fled China back in the 50s after a failed uprising against Chinese rule. The Tibetan leader has lived in exile in India.

China has warned the ties between America and China will be strained if President Obama meets with the Dalai Lama. The Dalai Lama himself is going to appear on "Larry King Live" next Monday on 9:00 p.m., Eastern. It will be his first interview after meeting with the president.

Checking some of our other top stories.

The big military offensive in Afghanistan continues to heat up. ISAF, the NATO-led force, reports that two troops have been killed in the latest fighting. Few details so far, but we know they were killed by small-arms fire.

A small plane has crashed into some homes in east Palo Alto, California, killing three people aboard. No one on the ground was hurt. The plane had just taken off in foggy weather and apparently broke into pieces after hitting some power lines.

And Congress won't be hearing from Toyota's president at scheduled hearings next week. Akio Toyoda says his North American chief will speak on his behalf next week. The government is investigating the timeliness of Toyota's big recalls.

All right, when we come back, we are going to -- for those of you who have traveled through New York and gone through Penn Station, you know that is not one of the better experiences for train travel in America. There is some stimulus money going in to make that better. CNN Radio Steve Kastenbaum will join us with an update on the stimulus money when we come back.

(COMMERCIAL BREAK)

VELSHI: All right. New York's Penn Station, a legendary station. It is one of the nation's busiest train hubs. It's also, by the way, sad to say, one of the ugliest. Penn Station serves some 600,000 rail commuter and subway passengers every day. Amtrak, New Jersey Transit, Long Island Railroad. You're looking at it right now. I call it affectionately the Belly of the Beast. I've had many a daily lunch there.

Everyday, 9 million Amtrak passengers come and go every year from poorly lit underground platforms. Now, $83.3 million in federal stimulus money is going toward a phase one expansion of the station. This is part of a much bigger expansion effort with an estimated price tag of $1.5 billion. In the end, passengers could one day -- there's what it will look like, that's an existing post office across the road -- in the end of you could disembark at an iconic train hall at this post office across the road.

CNN Radio Steve Kastenbaum has been on this from "The Stimulus Desk," he joins me from his post in New York. Steve, tell us the story.

STEVE KASTENBAUM, CNN RADIO NEW YORK CORRESPONDENT: Well, Ali, everybody agrees Penn Station is a horrible place. Everybody agrees this is one of those projects that makes sense. It's a good place to spend stimulus dollars, so it's a, quote, "shovel-ready project," and that means they're ready to go on that, right?

Well, Senator Schumer said this will create a bunch of jobs. We think it will create about 400 jobs once they get going here with phase one. They'll build new entrances. They'll expand some concourses and create better access to the platforms, but do you know what? Even with this shovel-ready -- the shovel-ready project all ready to go, it will still be many months before the 400 people start working, and it's not going to be done until maybe 2015.

So, here's an example of a project ready to go, it's got the approval of just about everybody who needs to approve it, everybody loves it as a project, they want to get it going fast. The stimulus dollars are there, and it's still going to be a long time before all those jobs are created.

VELSHI: All right, but if it ever happens, I might come back to New York, Steve, because Penn Station, while it's dear to my heart, is a bit of a mess.

KASTENBAUM: It really is. It's a terrible station as far as how it's able to handle the capacity. Over the years, you know, the number of people coming through Penn Station, the commuters, the people on Amtrak, has grown dramatically. And there just are not enough entrances and exits to handle all those people.

It's dimly lit. The ceilings are very low, and in the end there's the larger project, phase two, that will create a really big, grand rail hall, a waiting room, with a glass atrium at the Farleigh Post Office building across the street.

But there's a lot to be done before that even becomes a reality. It will cost, as of right now, $1.5 billion, if not more, over time. This is just phase one, where they're going to create a few new entrances and exits and expanding the access to some platforms. This is sorely needed. Everybody agrees this is one of those projects that makes sense for the stimulus dollars. But again, it will take many years for that greater project to get rolling, and for the thousands of promised jobs to be created, Ali.

VELSHI: All right, Steve, good to you see you. Thanks very much. Steve Kastenbaum from CNN Radio, joining us from his radio booth in New York.

All right. Let's talk Olympics for a second. Who is the most recognizable U.S. athlete at the Olympics? For me, it's very, very clear. It's Shaun White. This guy is everything I ever thought a snowboarder should look like. We're going to tell you more about him when we come back after the break.

(COMMERICIAL BREAK)

VELSHI: All right. Chad's with me here. You spent a lot of time in Detroit. I grew up in Toronto. You listed all the snow in Buffalo. Toronto was not like that. Very close to Buffalo. Other side of the lake.

(WEATHER REPORT)

VELSHI: All right. When we come back, I promised you -- you know this guy, right? Shaun White, the snowboarder. He's a dude. He looks as much like a snowboarder as anybody could ever look. He used to be known as the flying tomato. Apparently he doesn't want to be called that anymore. We'll talk about with it with Mark McKay at the Olympics in just a minute.

CHAD MYERS, AMS METEORLOGIST: Remember the flying banana?

VELSHI: No.

MYERS: Remember that...

(COMMERCIAL BREAK)

VELSHI: Let's go to Mark Mckay. He is covering the Olympics for us in Vancouver. You know, Mark, you know these people. You watch them. You can identify any one of these athletes probably from any of the countries just by looking at them. When I was watching the opening ceremonies, watching the Americans come in, I could not tell them apart because they were all dressed the same, but you could tell Shaun White from anybody else.

MARK MCKAY, CNN SPORTS CORRESPONDENT: Yes, even under that hat, Ali, that bright red hair, that big white smile, he is back and looking to make a name for himself once again as the Halfpipe snowboarding competition is under way up at Cypress Mountain. It has been four years since Shaun White first burst on to the scene and here he is, again, looking to defend that Olympic gold medal.

(BEGIN VIDEOTAPE)

(voice-over): How does a kid from the sunny beaches of San Diego become the most famous snowboarder in the world?

SHAUN WHITE, 2006 SNOWBOARD GOLD MEDALIST: I went under the wave right off of the bat and got some wash for a good couple of minutes, get some air, go back under in the wash, and then as I came out the board hit me on the face, and I said, I don't want to ever do this again.

MCKAY: That is why Shaun White chose the snow over the surf, but how did he get so good living more than three hours from the closest snow resort with a halfpipe?

WHITE: It was like this treat everytime I got to go to the mountains. I just made it count. I would cram months of snowboarding into one or two days.

MCKAY: Cheap trips to pricey ski resorts proved to be educational in more ways than one for White.

WHITE: This mountain town it was super expensive to eat and everything, and my mom would cook up burritos and stuff in the room, and the fire alarm would always go off. We even tried to, like, rig it with a shower cap and it would always go off.

MCKAY: If you have not guessed by now, Shaun White is not your typical snowboarder. And yet, he is the prototypical one, winning virtually every competition at some point in his career that started when he was seven.

WHITE: I would win the event and I wouldn't even get the award, because it was in a bar.

MCKAY: He may have been ahead of his time, but since winning Olympic gold in 2006, times have most certainly changed, and so have the bars.

WHITE: I am walking through the crowd, and there is Elton John and Tom Cruise and all of these crazy people, and I am like, this is just wild. And everybody seemed to know my name.

MCKAY: And he has used his name to move the once outsider status of snowboarding into the mainstream, with big-time marketing deals that have sometimes called into question the snow creed, if you will, of the man dubbed The Flying Tomato.

WHITE: Heinz did call. I'm like no...

STEVE FISHER, SNOWBOARDER: He just has had opportunities that not everyone gets, and let alone no one gets. A lot of people can be rock stars as long as there's the capital behind it.

WHITE: It was definitely like, you know, my own personality in what I am doing with these companies. So, I don't know, I think that I have been able to keep all of my credibility that way.

MCKAY: And even his critics don't debate his talent.

FISHER: How do you beat him? I don't know. I've done it a couple of times -- I still don't know.

WHITE: I've always had this thing where I see what to do before I do it, and I look at myself and say, what can I do?

MCKAY: : The world is awaiting that answer in Vancouver.

(END VIDEOTAPE)

MCKAY: For the past year, Shaun has been working on the routin,e and we will see apparently a new secret move tonight at the Vancouver Games, one that Shawn hopes will lead to another Olympic gold medal.

VELSHI: Right. And the opening ceremony started with a display of snowboarding, obviously something that really captures the attention as the video in your piece showed. But I have to say, though, with $8 million in endorsements last year from those companies, as much as his cool dude image prevails, at some point, that snow cred, or the street cred, could take a hit.

MCKAY: That is right. He has probably gone high-tech and high- brow now above his fellow snowboarders with what he has earned. His face is even in Times Square, Ali, with a big billboard with Shawn's blazing red hair, so he is everywhere now.

VELSHI; And Mark, we will check in with you a little later. Mark McKay in Vancouver, checking in with the Olympics.

When we come back, Ed Lavandera. He's been giving us the series on how guns are getting into hands who shouldn't have them. He's got the latest installment of that. How guns are getting into cities, and a crackdown on how gun owners who report their guns lost or stolen.

(COMMERCIAL BREAK)

VELSHI: There is a real shootout going on over a new law aimed at keeping guns out of the hands of criminals. Critics say it ends up hurting legal and responsible gun owners. Ed Lavandera is on the gun trail, and he brings us new information every day. He joins us now live from Dallas with his latest installment. Ed, what have you got?

ED LAVANDERA, CNN CORRESPONDENT: Well, Ali, we took a look at the problem with the illegal gun trafficking here in the United States. The final part of the series, we will take a closer look at one of the possible solutions. So, we traveled to state of Pennsylvania where an idea there has been actually hit with quite a bit of controversy. Take a look.

(BEGIN VIDEOTAPE)

JANA FINDER, CEASEFIRE PA: So you get tired of hearing people complain.

LAVANDERA (voice-over): Jana Finder says not enough is being done to keep illegally trafficked guns off Pennsylvania's streets. This might be the heart of northeastern gun country.

FINDER: To report their handguns when they're lost or stolen to the police. LAVANDERA: But Finder, along with a group called Ceasefire PA has launched a grassroots campaign to get local governments to sign on to what's become a highly controversial law called "Lost and Stolen Ordinances." Supporters of gun rights hate it. The ordinances require gun owners to report if their weapons have been lost or stolen usually within 24 hours.

FINDER: There is very strong support for lost concerns because they have told us that this kind of requirement would give them another investigative tool to help crack down and reduce the numbers of illegal handguns in our streets.

LAVANDERA: Finder says these laws target the number one source of guns for criminals, people with clean records who buy guns then supply them to street criminals, the so-called straw purchasers.

(on camera): The battle over straw purchase ordinance is being waged across small towns all over Pennsylvania in city council chambers like this one here in Duquesne.

(voice-over): Duquesne's city council was one of the latest to get behind it. So far 25 Pennsylvania cities have adopted the ordinance.

MAYOR PHIL KRIVACEK, DUQUESNE, PENNSYLVANIA: I think that doing this gives us a chance of maybe to reduce violence in the city.

LAVANDERA: That maybe in the mayor's answer is what infuriates Kim Stolfer and his gun rights activist group called "Firearms Owners Against Crime.

KIM STOLFER, FIREARMS OWNERS AGAINST CRIME: To come up with an idea and adopt it based on, well, it might work, is ridiculous. We wouldn't get into an airplane that might fly. There is an awful lot of laws relating to firearms. The real problem here is that it's not illegal to lose a firearm. It's not illegal to have it stolen. But they want to prosecute you for being in that situation.

LAVANDERA: Supporters of the Lost and Stolen Ordinance say it's a way of keeping a tighter watch on guns that go missing.

Gun control advocates say images like these are playing out too often across Pennsylvania. Six law enforcement officers were killed in the line of duty last year alone. This funeral honored Officer Michael Crenshaw who was murdered with an AK-47 in this neighborhood outside of Pittsburgh. Investigators say the suspect was wearing an ankle bracelet, a parolee on drug and gun charges.

So far more than a hundred police departments have come out in support of the Lost and Stolen Ordinances.

CHIEF HOWARD BURTON, PENN HILLS POLICE: Most of these ordinances that are being passed...

LAVANDERA: But not everyone in law enforcement thinks it's the answer. Penn Hills Police Chief Howard Burton says "lost or stolen" is just another feel good law that wouldn't have saved Officer Michael Crenshaw.

BURTON: We still have to realize we're dealing with a criminal element. No matter how many laws that are out there, there's still going to be broken.

(END VIDEOTAPE)

VELSHI: Ed, nobody has been arrested yet on this, right?

LAVANDERA: No, that is the interesting thing. This started to gain momentum a year ago and supporters say that, look, a couple of the cities they have been tied up in lawsuits. In other cities, police departments are trying to figure out how to use it. It drives the critics of this crazy. They say, look, it is not even being implemented, so how does it work?

VELSHI: Now, tell me how it's actually supposed to work in reality. Break it down for us.

LAVANDERA: Well, this is where it gets into meat of the controversy. Supporters of this say, look. A gun goes missing and if someone alerts the ATF, the police, whoever that it is missing, at least it is on the radar to be on the lookout for it.

But critics say, look, law-abiding citizens are not the problem here, it's the criminals that we're worried about. So they say, look, if a gun shows up at a crime scene and any of the ATF or any other investigators show up, knock on the door and say your gun turned up at this crime scene. What is the deal? They can say, oh, no, I just now lost it. Now I am reporting it stolen, and you can't really do anything to the guy, critics say. So they say, that's the problem, that it's really not going to help in reality.

VELSHI: All right. Great series. We've learned a lot about how guns get into the hands of people whose hands they shouldn't be in through your work.

Thanks.

Ed Lavendara joining us from Dallas.