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The Power of No; Taking Goods in Plain Sight; What Role Government Played in Toyota Problems; Stimulus Dollars Fund Road Projects; Stocks Set to Rise; Eye on Autos; Recession-Proof Meal; Getting Washington Out of Texas; Blocking Emergency Spending

Aired March 02, 2010 - 09:00   ET

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

KYRA PHILLIPS, CNN ANCHOR: Good morning, guys. And happy Tuesday. It's 9:00 a.m. in the East, 6:00 out West, and time for Uncle Sam to fess up about Toyota. What did he know about those safety problems? When did he know it? And how did he throw safety under the bus?

You don't really need mail six days a week, do you? A Saturday trip to the mailbox might be a memory soon.

And helping Haiti never sounded so good. You're going to love the way a good deed can sound.

But first, let's start with Senator Jim Bunning of Kentucky. Oh, boy, can you tell that he and his middle finger are not running for re-election? That's right. He is the one person standing between millions of jobless Americans and their money.

He says it's about fiscal responsibility, others say he picked the wrong time and the wrong issue to make his point.

(BEGIN VIDEO CLIP)

SEN. JIM BUNNING (R), KENTUCKY: If we can't find $10 billion to pay for something that we all support, we will never pay for anything on the floor of this U.S. Senate.

SEN. HARRY REID (D), MAJORITY LEADER: What we need is to recognize that there are poor people all over America who are desperate today.

UNIDENTIFIED FEMALE: Thanks, Bunning, we're looking for foreclosure.

(END VIDEO CLIP)

PHILLIPS: There are so many layers to this story. We are going to try and peel them all back. Stuff to think about. Does Senator Bunning have a good point about the $10 billion package, or is he just bitter carrying out a kind of scorched policy after his own party didn't back his re-election bid?

Can't Democrats just work around them? Is he hurting Republicans? And most importantly, who's getting the shaft? We're talking about people who need unemployment benefits to get by. Transportation workers, basically home on the couch because federal inspectors are now on furlough. But there are other projects are in limbo, too, including small business loans on hold.

Of course all this might be cleared up by tomorrow night in time for Senator Bunning to watch Kentucky play basketball in Georgia. He has made it clear that he loves his Cats.

All right, let's go back to some of those layers. Here's CNN senior congressional correspondent Dana Bash.

(BEGIN VIDEOTAPE)

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT (voice-over): It's a package of $10 billion to extend funding for laid-off workers, road projects and more. But one senator, Kentucky's Jim Bunning, is blocking it. And he angrily refused to answer questions about why.

UNIDENTIFIED REPORTER: Excuse me.

BUNNING: I better go to the floor.

UNIDENTIFIED REPORTER: Senator, can you just explain to us why you're holding this up? I'm sure you have an explanation.

BUNNING: Excuse me!

UNIDENTIFIED REPORTER: Are you concerned about those that are going to lose their benefits?

Guess we have our answer.

UNIDENTIFIED REPORTER: OK.

BASH: Bunning's move is having a real world effect. Construction workers here started their morning on the job, rebuilding a bridge outside Washington. But as the clock ticked towards noon workers on this $36 million project were told to stop and leave. The site locked up.

UNIDENTIFIED MALE: They told everybody to go home at 12:00. So everybody go home.

BASH: The Department of Transportation said it furloughed 2,000 workers around the country because Congress failed to pass legislation to extend funding for the projects. The $10 billion measure Bunning is blocking also includes unemployment benefits for some 400,000 people, COBRA health subsidies for laid-off workers and small business loans.

Bunning did go to the Senate floor and did explain. He is for extending benefits but he wants to pay for them, not add to the deficit.

BUNNING: If we can't find $10 billion to pay for something that we all support, we will never pay for anything on the floor of this U.S. Senate.

BASH: Bunning even formally offered a measure to pay for the benefits, Democrats objected.

REID: Where was my friend from Kentucky when we had two wars unpaid for during the Bush administration? Tax cuts that cost more than a trillion dollars unpaid for? Where was my friend and the Republicans objecting to that?

BASH: Democrats immediately saw the political benefit in playing up a GOP senator blocking legislation that would help hard-hit Americans. The Department of Transportation's press release carefully detailed for reporters examples of popular projects halted because of Bunning.

And the vice president jumped in, too.

JOE BIDEN, VICE PRESIDENT: It will mean the state and local governments won't get paid for projects they've already done. It means furloughing 2,000 people this week alone.

(END VIDEOTAPE)

PHILLIPS: Dana joins us now live from Washington.

So, Dana, you know, what is your take here? Is this typical political theater of someone's who's not going to be re-elected? Or is it a true sign of growing rage over the fact that we're spending money that we don't have?

BASH: You know, Kyra, I actually think it may be a little bit of both. You know Bunning is raising a legitimate question. In a time of record deficits, what's wrong with paying for $10 billion in benefits and programs that everybody says that they want?

But you know Democrats are saying -- that they disagree. That they think that this is emergency spending that is not needed to be paid for. They say it's just a fundamental disagreement on that.

But there is a political subplot here that we simply can't ignore. And that is that Jim Bunning, a Republican from Kentucky, has an awful relationship with his Republican leadership, and his fellow Kentuckian, the Republican leader, Mitch McConnell -- he is somebody who really pushed Jim Bunning to retire from the Senate instead of run for re-election this year.

So McConnell has virtually no leverage with Bunning and really no senators do here for various reasons. And so that's why it's hard for them to get Bunning to back down.

Now you might ask on the substance, well, can't they just work around Bunning and pass these benefits, you know, using Senate procedure? The answer is yes, they can, but Democrats know that they have a good political issue right now.

So talking to sources, they say they have no plans to do that in the immediate future. They'll do it probably at the end of this week, maybe next week as part of a larger package, but right now they think that they have a political winner here.

PHILLIPS: All right. Dana Bash, appreciate it.

So proud patriot or pain in the butt? We're asking you what you think about Senator Jim Bunning. Just go to our blog, post your comments, the address, CNN.com/Kyra. I'll read some of your comments on the air next hour.

From Pennsylvania Avenue to Main Street USA, President Obama taking his listening tour back on the road. Today he's going to travel to Savannah, Georgia, and once again he's going to focus on the economy and its sputtering recovery. He's going to talk to small business owners, workers and local leaders.

Let's get to that shaky recovery effort under way in Chile right now. Three days after that powerful earthquake, here's what we know. The death toll now over 700 as rescuer continue to search for survivors among the ruins.

U.S. Secretary of State Hillary Clinton just arriving in Chile as those aftershocks from the magnitude 8.8 quake continue to reverberate. The deadly quake also a global time killer of sorts.

NASA scientists say that the massive rumble actually shifted our planet's axis, and preliminary calculations suggest that each day has now been shortened by 1.26 microseconds.

Whether you call it scrounging or looting, people in Chile are taking stuff out of damaged or destroyed buildings right now. And today Chile's president said it will not be tolerated.

CNN's Soledad O'Brien joining us now live from Concepcion, Chile with more on this story. Soledad?

SOLEDAD O'BRIEN, CNN CORRESPONDENT: Yes, what's pretty clearly looting, people pretty much stealing whatever they can get their hands on. In some cases we saw someone, you know, trying to rip off a cheese store just because. And you have Michelle Bachelet, the president of Chile, has said that's not going to be tolerated.

We've seen a much bigger presence tanks rolling down the highway that's just there. The curfew is still in place, so not much traffic out but we expect all of that to change in just a little bit when the curfew lifts.

One of the biggest problems, when you draw people to the fires that have been created by the looters, you remove them from the search and rescue, which is what they also do. And as you can see, this building in the middle of a big search and rescue, it's a real problem as they try to make some progress here.

(BEGIN VIDEOTAPE)

O'BRIEN (voice-over): On the side of this building in Concepcion you can see the numbers, 1 through 15. Fifteen floors toppled sideways into a heap of rubble. The numbers on the chart of these rescue workers even more grim. Forty-eight missing and the count of the dead goes floor by floor.

(On camera): Of the 48 people who are inside, what is the likelihood that they are alive?

GUSTAVO RUDOLPHY, CHILEAN FIREFIGHTER: I don't know. We are looking -- there are some spaces there that perhaps we can find some persons, but in this floor down here, we -- I think there is no too much chance.

O'BRIEN (voice-over): These Chilean rescue workers were heroes in Haiti just a few weeks ago, digging out survivors of that earthquake. Now they're in their homeland doing the same after an earthquake estimated to be 800 times more powerful.

Just a block away, crowds watch a massive fire spread out of control. It was set by looters and the local firefighters who are running the search and rescue of victims and couldn't attend to both.

A drive down a main street becomes dangerous. Looters are breaking into open buildings, breaking into garages in clear view of military guards. The military said it had to take all groceries from the market to a distribution point, but at this mall they are way too late. There is nothing left to distribute and nothing left to take.

The water hoses were turned toward looters and people walking in and out of stores without resistance. I confronted two women carrying a bag full of goods, and asked what they had taken and why. They ran off in plain view of the military. No explanation. No reason.

Across the street, a family sat outside defending their tiny store and home. They can't go inside because of the powerful aftershocks still shaking their vulnerable house. They're afraid of being outside because people are trying to steal what little they have left.

JULIA MONTOYA, EARTHQUAKE SURVIVOR (Through Translator): We don't know what we're going to do. We're sitting out here waiting for somebody to help us.

(END VIDEOTAPE)

O'BRIEN: Some of the business people we spoke to are very angry. They set up a perimeter almost, Kyra, with tires and then whatever debris had sort of fallen down in the earthquake, blocking in all the stores on a street and then they would physically guard it with their dogs and sometimes they carry like pieces of wood, saying we're not going to let anybody come in. If no one's going to protect us, we'll protect ourselves.

But I think after those calls, certainly the word was sent to the president, who now is saying, she hears them, and there will be no looting tolerated. And we've seen a much bigger presence by the military. Kyra? PHILLIPS: We look forward to the follow-ups. Soledad O'Brien in Chile, appreciate it.

This morning in Washington, Toyota is back on the hot seat. And government regulators will also feel the heat. What do they know about the safety problems? And when exactly did they know it?

Lawmakers are demanding answers in a hearing scheduled to get under way at the top of the hour.

CNN congressional correspondent Brianna Keilar on Capitol Hill.

So, Brianna, let's talk about today's hearings and how they're different from last week. Because NHTSA wasn't even going to speak. Ray LaHood, head of transportation, wanted to do that for NHTSA because of course a lot of fingers were being pointed at NHTSA for dropping the ball and throwing our safety under the bus.

Now all of a sudden they're going to testify this week?

BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: And the reason that we're going to hear from NHTSA, the National Highway Safety Administration, this watchdog, really, this oversight agency of Toyota and other car companies, is because, quite frankly, Kyra, they don't really have a choice.

David Strictland is the head of NHTSA. He's only been on the job for six weeks, that's why Ray LaHood said that he wanted to really be the voice of the administration on the topic of Toyota.

But when David Strictland's nomination was processed, and it was processed by this very committee that he's testifying before today, and when Ray LaHood's nomination was processed by this very committee that he's testifying before today, they basically agreed that yes, we will provide witnesses if they are reasonably called for a hearing.

And so be careful what you promise to Congress because this is coming back, and now they really don't have a choice. Both of them will be testifying today amid some pretty big questions of really how did this situation with Toyota get so far down the road -- pardon by pun -- without government regulators really catching on?

Now the other big focus of this hearing, of course, Kyra, will be the issue of electronics in these Toyota vehicles. And Toyota has said -- it's expected to say today -- it's mechanical, it's not the computers in the car.

But we're going to be hearing from a consumer advocate. No doubt lawmakers are going to be asking tough questions about this, and at the end of the day, it's really what are lawmakers going to believe, what is the American public going to believe once Toyota says our cars are OK.

PHILLIPS: Brianna Keilar on the Hill, following it for us. Brianna, thanks so much. And we'll keep a close eye on today's hearing and bring you any developments. And don't forget about our Web site as well, where you can find out all the latest information including an on-going list of which models have been recalled.

That address, once again, CNN.com/Toyota.

Cotton balls as a symbol of hate. Students taking a stand, criticizing their school in the wake of racist incident.

ROB MARCIANO, CNN METEOROLOGIST: I'm Rob Marciano in the CNN Severe Weather Center. It is March, that means spring should be here -- at least soon by the calendar, but by the weather outside in the southeast, it's definitely winter. A winter storm coming across the southeast. We'll talk more about that in just a sec. Stay there.

(COMMERCIAL BREAK)

PHILLIPS: Cotton balls opening up wounds on one college campus. Students held a town hall meeting to discuss the incident at the University of Missouri where cotton balls were dropped in front of the Black Culture Center on campus.

(BEGIN VIDEO CLIP)

ANTHONY MARTIN, UNIV. MISSOURI LEGION OF BLACK COLLEGIANS: We're not going to tolerate any more of these issues. In the past we might have played issues like this down, but because it's -- you know, it's 2010, there's no reason that things like this should happen anymore.

(END VIDEO CLIP)

PHILLIPS: Some of the students called the university to make diversity classes mandatory on campus. Police are reviewing campus security cameras. Even checking local stores to see who bought those cotton balls.

All right. We got winter weather watches and warnings for parts of the Deep South this morning, right, Rob?

MARCIANO: Yes, we do. As a matter of fact, it's starting to snow in some of the largest cities across the south. Good morning Kyra, good morning, everybody.

(WEATHER REPORT)

PHILLIPS: Bummer. OK. I'll be careful.

MARCIANO: That's it.

PHILLIPS: Thank you, dad.

MARCIANO: OK.

PHILLIPS: Well, threatening lawmakers and using the post man as an unwitting accomplice. How the feds say they connected the dots in a years-long case to this guy and what white powder has to do with it.

(COMMERCIAL BREAK)

PHILLIPS: A 40-year-old Denver man in federal custody allegedly threatening members of Congress through the U.S. Postal Service. The feds say they linked Jay DeVaughn's handwriting to disturbing letters sent to Colorado and Alabama lawmakers.

Some of those letters were said to contain a white powder, not thought to be dangerous, but he faces up to five years if convicted. The feds also looking to see if the suspect sent similar mail to the Argentina consulate.

Can cities or states legally (INAUDIBLE) Second Amendment right to an effort to combat growing gun violence? Well, that's the crux of the case before the U.S. Supreme Court this morning, specifically the high court reviewing Chicago's law banning handguns and whether it's at odds with a person's constitutionally protected right to bear arms.

Former Tennessee Representative Harold Ford says he won't be mounting a challenge against U.S. Senator Kirsten Gillibrand in New York's upcoming Democratic primary. In a "New York Times" op-ed, Ford theorizes that he could win the primary but be too bruised from the campaign to win the election.

We'll be back in a moment.

(COMMERCIAL BREAK)

PHILLIPS: Road rules. Your state has laid them out deciding which road projects are going to be funded by those coveted stimulus dollars. And if you're wondering how those decisions are going to affect your community, wonder no more.

CNN's Josh Levs tracking your stimulus dollars for you right now.

(BEGIN VIDEOTAPE)

JOSH LEVS, CNN CORRESPONDENT: It's one of the biggest questions we always get from you about the stimulus. You say to us what about the roads near me? They are still broken and I heard about all these shovel-ready projects.

Well, guess what? Every state in the country has, as of now, had to make its decision about every dollar it's going to spend from the stimulus on road projects.

Let me give you the big picture here. Keep in mind in the first place that the stimulus is giant. It's $862 billion but a lot of that goes to things like -- it goes to benefits really. It's been supporting unemployment, it's supporting food stamps, various other things.

It's just a sliver of that that's going to what got the most attention, those, quote, unquote, "shovel-ready projects." And here's what's happening with road projects. We're getting this from the -- from the vice president's office. Here's what they're saying there.

For road projects, $26.2 billion in funding from that stimulus have gone to road projects. But that doesn't mean that they're all actually happening yet. It doesn't mean the construction is actually being done.

Here's the breakdown on that one. They're saying for more than 12,000 road projects are being funded, and are being told that they will get the funding. But in terms of how many are actually under way, it's fewer. 7,796 road projects are under.

What has to happen here was all the states have to by March 2nd let the government, the federal government, know how they're planning to use all those stimulus dollars for road projects. So that means a couple of things for you.

First of all, it means you will now be able to find out from your state definitively whether or not the roads near you will be fixed by stimulus funding. It also means if you're someone out there who's looking for jobs, you'd be able to find out if there is a road project that's planned right near you, again, from that stimulus funding.

And we want to hear from you about all this. We're always curious what you think and whether you are seeing pragmatic results from the stimulus right near you.

This is how you can reach me. You got my blog, CNN.com/josh. Also Facebook and Twitter, JoshlevsCNN. Let us know and also keep in mind, things might be changing over the next few months.

One thing the government is saying is that as the warmer weather arrives in the spring and into the summer, a lot more construction can be done. They plan to pick up the pace of that so you just might be seeing some work near you.

I'm Josh Levs, CNN, Atlanta.

(END VIDEOTAPE)

PHILLIPS: If you don't have mail, at least not on Saturdays. Scaled back delivery just one of the options for the Post Office that they looked to get out from under billions of dollars in debt.

(COMMERCIAL BREAK)

PHILLIPS: Well, stock rallied yesterday. The NASDAQ and S&P 500 moved back into positive territory for the year. That was good news. Opening bell now.

Alison Kosik from New York Stock Exchange with what could be in store for today -- Alison.

ALISON KOSIK, CNN CORRESPONDENT: Good morning, Kyra.

We are expecting to continue this rally, continue this positive momentum as the opening bell rings for now. Investors are following gains overseas. There are upbeat economic reports coming out of Japan, and of course, investors around the world are still holding out hope that dead-ridden Greece will get a bailout. U.S. investors could also get a little more clarity today regarding possible changes to bank regulations. Senate negotiators are reportedly closing in on a deal to create a consumer protection agency that will oversee everything from consumer credit cards to mortgages.

There was some uncertainty about the fate of those regulations and those concerns that hit the market earlier this year. We're also going to keep an eye on auto sales today because those could affect trading throughout the day. GM is going to kick it off when they report in about 15 minutes. GM and Ford are expected to post sales gains for February, but no surprise, Toyota will probably take a big hit because of its recall of 8 million vehicles. There is also talk that Toyota may roll out an aggressive incentive program to make up for the lost sales. Reuters is reporting that it may include 0 percent financing, free maintenance, and some cash rebates.

Let's take a check on the early numbers now. The Dell Industrials up 33, the Nasdaq up 6. And before I go, Kyra, I have to mention this because who doesn't love pizza, and pizza seems to be recession proof. Domino's Pizza says its fourth quarter profit more than doubled. Families, of course, have been eating out less because of the economy, but, Kyra, don't you agree, at 10 to 15 bucks for pizza, that's pretty good, right?

PHILLIPS: Let me think, 10 to 15 -- no, because I always call and say, OK, what's your special today, and there's always something that is $9.99.

KOSIK: True, but you have those coupons, Kyra.

PHILLIPS: OK, that's true. Did you see I have pulled the prank and I AMERICAN MORNING seeing head shaking right now that they did. I got the coupon, but I am not quite sure where it is. Can you give me the 9.99 deal? It's a bad economy, you know. People are out of work.

KOSIK: I hear you.

PHILLIPS: Thanks Alison.

KOSIK: Sure.

PHILLIPS: Rain, sleet, and snow won't stop them, but they never expected the Internet. The Post Office now getting drastic with cost cutting measures with plans to possibly stop Saturday delivery. CNN's Christine Romans live in New York this morning. There goes all of your Saturday love, all those cards and letters from family and friends, Christine.

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: And junk mail.

PHILLIPS: Yes, that's right. OK, I was trying to be positive. We do need to get people writing more letters, though. Yes, that's right. I know. ROMANS: You know, I am with you. I'm pretty retro on this. I like to write letters, and I like to write things, you know, and I think that is a nice touch in the seal of --

PHILLIPS: Amen. I agree.

ROMANS: This is the postal service, you know. They've been losing money for years, and now Jack Potter, who is the postmaster general, has sounded the alarm and saying, look, we need an independent commission to advice congress on some big changes that we might have to make to try to get our house in order. We don't have to use tax that they borrowed $10 billion to keep going here.

They want five-day delivery, considering five-day delivery. We are assuming that means dropping the Saturday delivery, but maybe it means dropping a day in the middle of the week, something that's not possible with small businesses, but then Saturday delivery dropping, that is not popular with Congressional constituents who say, hey, this is the day that I run and do errands, closing branches. Did you know, Kyra, the 32,000 branches, 26,000 of them lose money?

And also, talking about adding more self-service kiosks. You've seen this in the lobby probably of your Post Office and your branch, your local branch, but talking about putting them in other places too where you can get maybe the grocery store where you can do mail a simple package or buy stamps or the like. 600,000 workers are at the postal service. They're talking about a leaner, meaner Post Office. Half of those are slated to retire over the next ten years, so by tuition (ph), they are going to not replace the lives of those people. The Post Office, by the way, has never had blatant job cuts, but as their force starts to retire, they are going to be replacing pure of those people and trying to be more nimble.

Now, why are they losing so much money? There are a lot of different reasons. Their volume is down, of course. Their costs are very high. Every time you talk about closing a branch, constituents go crazy and Congress gets involved trying to protect their routes and their jobs and their branches. But again, this numbers are pretty clear. This is an organization, an agency, a company, if you will, that's losing last year, Kyra, lost $7,000 a minute, a minute.

So something has to be done and Jack Potter, the postmaster general, saying that these are among the things that are on the table -- Kyra.

PHILLIPS: All right. I guess, we'll trying to roll with it. Thank you. We'll keep writing those hand-written letters and thank you notes, Christine.

ROMANS: Right, Monday through Friday.

PHILLIPS: All right.

The ground shook for less than three minutes, and for some, the affects could last for years. We have the latest now on the aftermath of the quake in Chile. More than 700 people confirmed death with that toll actually expected to climb. Rescuers still trying to reach possible survivors in the hardest hit areas, and there are reports of food and water shortages. Lines are long at gas stations and in front of banks, but in the capital of Santiago, things are starting to return to normal.

Returning to normal is still a challenge in Haiti, but aid does continue to poor in, and coming up in our next hour, something you won't want to miss.

Grammy winning singer, Michael W. Smith joining us live. He's one of the artists that contributed to the healing for Haiti benefit album. It's out today. Also joining us, Franklin Graham whose Samaritans has been helping in Haiti since right after the quake.

Question for you. If one of the most famous astronauts goes on "Dancing With the Stars", does he do the moonwalk?

(COMMERCIAL BREAK)

PHILLIPS: Family and friends on hand in Illinois. They say their final good-bye to the SeaWorld trainer killed by an orca. New details coming out now about the attack on Dawn Brancheau. Park workers say it took as long as 30 minutes to actually corral that killer whale and that they had to pry the animal's jaws open to finally get the trainer out.

Now that his dental work is done, Lil Wayne probably headed to prison today sensing on a gun charge scheduled for this afternoon. The rapper was supposed to be sentenced three weeks ago but got a delay so he could have his diamond-studded braces removed. He is expected to get a year in prison.

Hey, you want to buy some tickets? Four men charged in scheme to get all the good seats. Concerts like Springsteen, Hanna Montana, plus baseball and college football championship games thrown into the mix. Prosecutors say the men set up elaborate computer systems to buy pass ticket limits. They allegedly made $29 million reselling the tickets.

He has done the moon, and now he's shooting for the stars. Buzz Aldrin, one of the original moon walkers will cut a rug on this season's "Dancing with the Stars." Second man on the moon, first astronaut on the show. He is a little bit grayer than most dancers, but hey, none of you whippersnappers has ever been light on the feet as Buzz has. Aldrin will be the second oldest contestant, by the way, right behind Rob Mooker (ph) herself --

All right. Let's check out the most popular stories on CNN.com right now. We like to go to the news polls page and see what you are logging on to and rally determining what is the most popular story four you online.

Right now, bye-bye Saturday mail. We're talking all about that. That's the first most popular story.

Then let's go down, we haven't given you much information on this, but GM recalling 1.3 million vehicles now. You could go to CNN.com, clink on news polls. You can read more about that. Also, it looks like OSHA actually warned SeaWorld that that whale would kill. The whale that took the life of its trainer that we just mentioned.

Also one of the most popular stories, the segment we got coming up at the top of the 10:00 eastern hour, the racial tensions rising at UCSD in San Diego, California.

Also, Jerry Brown seeking a return as California governor. Check it out.

Those are some of the most popular stories right now on CNN.com. You can go to the site, check out the news polls, icon at the top list of your page. It's updated every 15 minutes. We'll be back in just a sec.

(COMMERCIAL BREAK)

PHILLIPS: You know, throughout the morning we have been talking about Senator Jim Bunning and the argument is, you know, does he have a good point about the $10 billion package? Are we spending money that we just don't have? Or is he just bitter that he's not going to be re-elected so he wants to be the one senator to road block on employment benefits? So many journalists have reached out to try to get him to talk. He hasn't agreed to do so the ambushes have begun.

Here is another one.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Are you getting any support from the Republicans yet with the idea of pulling this out of the stimulus?

SEN. JIM BUNNING, (R) KENTUCKY: I think so. I thought if you listened on the floor yesterday --

UNIDENTIFIED MALE: I did, yes.

BUNNING: OK.

UNIDENTIFIED MALE: So do you think that they will fall in behind you?

BUNNING: No, I don't think so.

UNIDENTIFIED MALE: Why not?

BUNNING: You have to ask them.

UNIDENTIFIED MALE: Oh, I see. I mean, the Republicans, as far as your colleagues are concerned, will they be behind you on this?

BUNNING: You will have to ask them.

UNIDENTIFIED MALE: Yes, sir. Anything from Senator McConnell?

BUNNING: Not a word.

UNIDENTIFIED MALE: Thank you, sir

(END VIDEO CLIP)

PHILLIPS: The story, we'll continue to follow for you.

All right. Will it be rain or snow? The question assure for many in the southeastern United States today. Rob Marciano tracking it all for us.

(WEATHER REPORT)

PHILLIPS: The pot calling the kettle black? Disgraced Illinois ex-Governor Rob Blagojevich lecturing, of all things, on ethics. I can't wait to hear this.

A white March 2nd is such a big deal, well, because it's the day "Time" began as in "Time" magazine making it's newsstand debut this day in 1923.

Then cue the music, four years later, Babe Ruth could afford the really good cigars and the booze, too, unfortunately. Today, it's the day that he actually signed a three-year-deal with the Yankees and guess what? They made him baseball's highest paid players. You know how much, $70,000 a year. Do you think A-Rod could get by on that?

(COMMERCIAL BREAK)

PHILLIPS: Here is a story that has us scratching our heads and rubbing our eyes and taking a double look at what we just read. Former Illinois Governor Rod Blagojevich, it turns out that it's not just his hair style that defies logic.

The indicted Democrat is hosting a sold-out show tonight. And guess what the focus is? Ethics. Blagojevich has always maintained his innocence and will present his case tonight at his alma mater of Northwestern University and students will be asking him all kinds of questions. What do you think? A lesson in irony, yes?

So do you want to trade some scripture for some skin? That's the offer at the University of Texas in San Antonio. A student atheist group offering free porn for anyone turning in a bible; students protested with prayer and the school says it's a freedom of speech matter. As you can imagine, the porn publicity stunt stirred up some pretty strong emotions. The student atheist group says it will donate the bibles to local libraries.

Tracking Toyota, another winter storm and medical waste, we're reloading for the next hour of CNN NEWSROOM beginning with Brianna Keilar in Washington.

BRIANNA KEILAR, CNN CORRESPONDENT: Kyra, the third Toyota hearing in a week here, but it's the first time that we will hear from the government's top regulator over Toyota and other car companies. I'll have that this hour. MARCIANO: I'm Rob Marciano in the CNN Severe Weather Center. You heard it, another winter storm, this one across the south. Pandemonium across north Georgia, snow on the ground, kids going home from school early. Weather next hour.

ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: I'm Elizabeth Cohen in Atlanta. Can you go bargain shopping for a colonoscopy? You bet you can. I'll tell you how at the top of the hour.

PHILLIPS: All that plus the battles for governor in Texas and California going beyond party loyalties. We're back right after this.

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PHILLIPS: Every bride and groom stresses about something, right? Well, in this case anxiety became anger. Why? Because thousands of brides and grooms were ready to go to the biggest bridal show in Boston, but it turns out it was all a scam. A scam that cost 10 to $15 for a prepaid registration fee and then companies hoping to reach those newlyweds to be, well, they shelled out hundreds and even thousands of dollars also.

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UNIDENTIFIED MALE: The same person that I talked to was the same person that every other vendor talked to that I spoke to. She was just very nice. She called us the next day, she would talk to us or whatever we needed and it seemed -- it seemed legit. (END VIDEO CLIP)

PHILLIPS: Getting even from a broken heart, disgruntled brides, grooms, who knows, but these scammers used Facebook and a fake Internet site to lure their poor victims.

Forget the pulling down the pants, now the billboard is being yanked down, just like the jeans that caused so much outrage. Here's the risque ad that sparked the outcry. Seemingly everyone from Newark's mayor to the parents with children in tow who said the ad was too sexually suggestive. Not sure when it's going to get pulled down, but we are on it.

Here we go again. Jerry Brown expected to announce today that he's running for governor of California. It's not his first time. He was governor in the '70s and the '80s and since then he's run for just about everything else; president, senator, mayor, now he's the state's attorney general. It wasn't much of a secret either. He's been asking for donations at JerryBrown2010.com for months now. And be sure to tune in tonight to hear more. Jerry Brown is Larry King's live guest at 9:00 p.m. Eastern time.

Getting away from Washington, that seems to be the theme in Texas where a couple of high profile Republicans are battling it out. CNN senior political correspondent Candy Crowley has more for us.

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CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT (voice-over): Texas Senator Kay Bailey Hutchison has been out flaunting her roots.

UNIDENTIFIED MALE: (INAUDIBLE) Texas and she's right now our senator, Kay Bailey Hutchison.

CROWLEY: Why does the great, great granddaughter of a man who signed the Texas declaration of independence in 1836 have to remind Texans that she's one of them?

GOV. RICK PERRY (R), TEXAS: When you spend the last 17 years of your life as a United States senator in Washington, D.C., when you voted for the bailout that in hindsight was an absolute atrocity, then you must go to the people of the state of Texas and explain to them why you're not a creature of the Washington culture.

CROWLEY: The race to be the Republican nominee for the Texas governor is all about Washington.

SEN. KAY BAILEY HUTCHISON (R), TEXAS GUBERNATORIAL CANDIDATE: There is an anger all over America, and certainly all over Texas, about what's happening in government, the overreach in Washington. People think, "What on earth are those people thinking up there?" And I don't disagree with them, I agree with them.

DICK CHENEY, FORMER U.S. VICE PRESIDENT: And when it comes to being conservative, Kay Bailey Hutchison is the real deal.

CROWLEY: A year ago, Hutchison was the fave, a popular Republican seen as the establishment candidate who would broaden GOP appeal.

But that's so 2009, before incumbent Governor Rick Perry's year- long full embrace of anti-Washington, anti-tax, socially conservative rhetoric. And that includes a declaration at a tea party event that Texas should consider seceding from the Union.

WAYNE SLATER, DALLAS MORNING NEWS: That got an enormous response, not because Texans' want to succeed, but because they hear the word succession as code for, we don't like Washington, unbelievably successful.

CROWLEY: Perry now leads Hutchison by double digits. Not that it's that simple.

DEBRA MEDINA, TEXAS GUBERNATORIAL CANDIDATE (R): I'm here to tell you today we are going to win -

CROWLEY: Debra Medina has promised to abolish property taxes and ignore federal laws that she thinks are unconstitutional. A gun- owning nurse who home schools her children, Media is a tea party activist, campaigning as the real anti-spending, anti-Washington conservative.

MEDIAN: Boy they sing the song well during campaign season but don't legislate that way.

CROWLEY: Medina's presence in the race could force a run off if no one gets to the 50 percent threshold. But she took a hit recently and her numbers began to fall when she did not immediately repudiate the notion that the U.S. government was envelope in 9/11.

Candy Crowley, CNN, Austin, Texas.

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PHILLIPS: Senate Democrats trying again to pass a jobless benefits extension being held up by one Republican. Retiring Senator Jim Bunning of Kentucky says he wants a plan in place to fund the bill.

Dana Bash caught up with Bunning just a few minutes ago.

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DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Do you mind if I walk (ph) after you? I have really just a couple of easy questions for you to answer.

SEN. JIM BUNNING (R), KENTUCKY: I bet you do.

BASH: Sir, specifically on the fact that I understand your point that you're making about the need to pay for these benefits. But what Democrats are asking and I think it's a good question is why now? Why not before?

BUNNING: It has been.

BASH: Why haven't you called --

BUNNING: I have been.

BASH: What has changed? Why are you now calling for things to be paid for?

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PHILLIPS: The legislation not only affects millions of unemployed Americans but a nationwide transportation project. Emergency spending measures require (INAUDIBLE) to vote. We'll talk to Dana Bash coming up this hour.