Return to Transcripts main page
CNN Newsroom
Religious Violence in Nigeria; Tough Lesson in Economics; Schools' Drastic Changes; Preventing More Madoffs; House GOP Votes to Ban All Earmarks; Defaulting on Mortgages
Aired March 11, 2010 - 12:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(COMMERCIAL BREAK)
TONY HARRIS, CNN ANCHOR: Boy, oh, boy, a lot to get to. Time for your top-of-the-hour reset. I'm Tony Harris in the CNN NEWSROOM.
It's 11:00 in Kansas City, where the board of education decides to shut almost half of the district schools.
It's 6:00 in Nigeria, where a nation convulses in a new spasm of hatred between Christians and Muslims.
And across the country, more underwater homeowners think about walking away from a sinking investment.
Let's do this. Let's get started.
Desperate times, drastic measures, really -- almost half of the inner city public schools are being shut down in Kansas City, Missouri, to avoid bankruptcy. Parents are outraged. They interrupted the school board's vote several times last night. But officials point to dwindling enrollment, budget cuts and a 50 million dollar deficit. Students and parents say they ultimately pay the price.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: I feel like I have nothing. I don't even have a high school legacy at all. I have nothing. I have nothing to go back to.
UNIDENTIFIED FEMALE: I have an eight-year-old and a six- year-old who will be going to school with a 12th grader. And I find that to be very inappropriate, very inappropriate. I don't feel like our children will be safe.
(END VIDEO CLIP)
HARRIS: Our Ines Ferre has details on this plan. Break it down for us. What's in this plan?
INES FERRE, CNN CORRESPONDENT: Basically, what this plan says is that 28 schools in Kansas City will be closing. The superintendent calls it the right-sized plan. They're also cutting some 700 jobs, including 285 teacher jobs.
Now, there will be transition teams to help the students and their parents, so that everything is in place by the fall. And, you know, one of the concerns are the high schools, because high schools will be incorporating seventh and eighth graders. So they're going to have to have different starting times, bell schedules, so though that they're not in the hallway at the same time, Tony.
HARRIS: Remind us, again, what is driving this restructuring?
FERRE: Well, a lot has to do with money, a 50 million dollar deficit. The superintendent saying they're operating way too many schools. Here's what he had to say this morning.
(BEGIN VIDEO CLIP)
JOHN COVINGTON, KANSAS CITY SCHOOL SUPERINTENDENT: We were spreading ourselves far too thin, facing a $50 million deficit. And if we didn't do something to take our school district off that trajectory, we could have easily gone into bankruptcy.
(END VIDEO CLIP)
FERRE: Now, the superintendent saying that they just can't afford to operate these schools if there aren't enough students in them. Enrollment has been going down and down over the last ten years, from 35,000 to about 18,000 now, Tony.
HARRIS: So this new school district that's being shaped here in Kansas, what are the demographics of this community that this district will now serve?
FERRE: OK, you've got 52 percent African-American, 21 percent Hispanic, 14 percent white, and two percent Asian-Pacific Islander. so you can see it's largely minorities.
HARRIS: It really is. And these are the populations that really need this education and can least afford these cuts. Are we seeing an up-tick in school closings in other parts of the country? I know the answer to that is yes.
FERRE: Yes. We've seen it in different districts. They've been closing maybe one or two schools. We've seen that in Detroit. They had something like 29 schools that closed before classes started this fall. And you also had even in Boston this week -- you had a meeting with the school committee there, where they were talking about the possibility of closing schools there.
HARRIS: OK, Ines, appreciate it. We'll do more on this later in the hour.
More big stories we're following for you. Congress takes another look, its fourth, at the Toyota safety recalls. Today's House hearings comes amid the backdrop of new reports of runaway Priuses. Federal safety investigators are looking over this Toyota in San Diego, trying to pinpoint a cause for sudden acceleration.
Across the country the investigator's boss is on Capitol Hill, under fire for the way his agency has handled the Toyota recalls.
President Obama outlines a plan to boost US exports. He wants to double exports over the next five years to support two million jobs. In a speech last hour, the president pledged to help US companies stay competitive. He is calling for better access to financing and better promotion of US products overseas.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We remain the number one exporter of goods and services in the world. So, we've got a terrific foundation to build on.
But we can't be satisfied with being number one right now. We shouldn't assume that our leadership is guaranteed. When other markets are growing and other nations are competing, we've got to get even better. We need to secure our companies a level playing field. We need to guarantee American workers a fair shake. In other words, we need to up our game.
(END VIDEO CLIP)
HARRIS: All right. The National World War II Memorial in Washington honors what's been called the greatest generation. Today, some 250 veterans taking part in a wreath-laying ceremony at the memorial, and coinciding with HBO's premier of its miniseries about the war, "The Pacific." Producers Tom Hanks, Steven Spielberg and former Senator Elizabeth Dole is there. Steven Spielberg is talking now. Let's take a listen.
STEVEN SPIELBERG, PRODUCER, "THE PACIFIC": -- about love and what love really means. Because the business of being ready to lay down your life for someone you don't even know is a definition of love.
You taught us that greater love hath no man than this, than a man lay down his life for his friends. You taught us things that I was certain we'd never forget. But in all the generations that followed, time was not standing still, and technology benefiting our lives was also distracting us from learning about where we came from and to whom we owed such a measure of devotion.
So, with each passing generation, more and more people were forgetting about World War II and all the milestones of the 20th century. And that's why movies, and that's why television, the very same technology that celebrates the now generation, is also a window of opportunity --
HARRIS: OK, film director Steven Spielberg. His films chronicling the World War II period, including the Holocaust and "Saving Private Ryan." By the way, the trip by the veterans to the memorial paid by HBO, American Airlines, Marriott Hotels and Resorts, and the Honor Flight Network. Wasn't aware of that. And the HBO film being screened -- is it tonight -- by the president and the First Lady at the White House.
Chile was rocked today. Three powerful aftershocks from the earthquake last night -- or last month. The strongest had a magnitude of 6.9. The earthquakes were centered between 86 and 95 miles southwest of the capital Santiago.
Our colleagues at CNN Chile said the shaking lasted more than 45 seconds. The quake struck just as Chile was swearing in a new president. Sebastian Pinera took office about 20 minutes after the second aftershock.
(WEATHER REPORT)
HARRIS: Imagine for a moment a science class with no textbooks, and students with no supplies. I will talk with an inner city teacher about educating kids as schools slash their budgets.
First, though, our "Random Moment" in 90 seconds.
(COMMERCIAL BREAK)
HARRIS: Boy, do I know this one to be true. Sometimes the brain and the tongue get their wires crossed, right? That, of course, can lead to a "Random Moment" of the day. Especially in Washington, where titles are a really big deal, right? So, watch the First Lady and the secretary of state.
(BEGIN VIDEO CLIP)
MICHELLE OBAMA, FIRST LADY: Well, thank you. This is, indeed, a pleasure and an honor to be here with all of you today. You all look fabulous. This is a wonderful occasion. Let me thank my dear friend Senator Clinton -- Secretary Clinton. I almost said President Clinton.
(END VIDEO CLIP)
HARRIS: Did you hear that at the end? "Almost said President Clinton." The slip-up led to what a London newspaper called "girlish giggles." Now that headline could actually spark its own random moment of the day. Just saying.
(COMMERCIAL BREAK)
HARRIS: Schools in crisis; budget shortfalls forcing school districts across the country to cut teacher jobs and student activities, or even close schools altogether. Joseph Lee teaches seventh and eighth grade at Chicago's Parkside Community Academy.
Joseph, good to talk to you. If you would, let's start here. Talk to us about the pressure of running classrooms on less money and the mounting pressure to close the achievement gap in your school district. JOSEPH LEE, CHICAGO TEACHER: Yeah. Absolutely. I would say the pressure is just amongst us teachers, because we have a commitment to close the achievement gap. I would say that, again, the pressure is just on us, you know. On a day where a lesson doesn't go well, I might -- the pressure would just be on me because I want to educate my students.
HARRIS: Yeah. What were the early days like this year for you? Take us back to the first few days, and what you faced when you walked into the class, the students you faced and the difficulties you ran in to virtually from the first day?
LEE: Absolutely. The first day was definitely the most difficult day. I wasn't too familiar with the school, the students, or the schedule. And so I had a tough time. But the students were ready for some structure. They were ready to learn. They were ready for someone to have some high expectations of them. And so where I am today is definitely different from where I was that first day.
HARRIS: And, if you would, talk to us about the resources that you have to work with. Before we even talk about the systemic problems, the resources you have and how difficult that makes it for you to do your job.
LEE: Absolutely. And so I guess the focus was on the science textbooks not being --
HARRIS: Yeah, yeah.
LEE: So, right off the bat, it was a challenge. But now that I see that science education is actually moving away from textbook knowledge, and into inquiry-based knowledge, a lot of classrooms will choose to not have textbooks, but instead work with hands-on material. And a lot of the support that I received from Teach for America, it's been -- it's been a -- it's been a challenge. But I can constantly say that the curriculum that we have and the lessons that I implement every day are rigorous, and the students are really learning a lot.
HARRIS: Hey, can I have you respond to a blog question here? Just a blog comment, really.
LEE: Absolutely.
HARRIS: This is from Jeremy, who writes, "Education will never be equal in this country." And I wonder if you think this is a fact of life: "Education will never be equal in this country. Wealthier districts can provide a more quality education than poorer districts." Is that just a fact of life we just have to come to terms with?
LEE: I mean, I think you can easily say that. I think you can cop out and say, that is a fact of life and that wealthier students will always have more resources. But at the same time, I see amazing things happening in our classroom and our school every day. And we have a lot of resources available. We have after- school programs, before-school programs at Parkside. And so, while there might bee that disparity, I do see, especially at Parkside, them really taking those steps to close that disparity.
HARRIS: You know what, you don't have to do this, obviously. And, you know, a lot of teachers can go into other lines of work. Why do you do this? I know your background. Boy, you could have done just about anything in the sciences. Why are you doing this?
LEE: Absolutely. Yeah, the first thing is my mother was a school teacher. And she still works with the youth group at our church, as do I. So I have a heart for children. And also growing up, I just saw this -- I saw children who weren't getting the opportunities to learn. And in essence, you're kind of taking away their future. So, if I'm able to give 32 of my students a chance for a better future, I think that it's a worthy endeavor.
HARRIS: Let's see if we can get the money to keep you in the classroom. Joseph, appreciate it. Thanks for your time. Good stuff.
LEE: Thanks, Tony.
HARRIS: You know, all this week we are looking at the economy and the impact it is having on schools across the country. If you have any comments or solutions, just send them to my blog. Here's the address, CNN.com/Tony. Or you can just simply call the show, 1- 877-742-5760, and tell me what you think. We want to hear from you. We'll be sharing some of your thoughts right here in the CNN NEWSROOM.
Help for the nearly 15 million Americans that are unemployed could be on the way. The Senate has passed a bill that extends unemployment benefits until the end of the year. Stephanie Elam is in New York. Good to see you, Stephanie. A lot of people are seeing their benefits run out because last week, they couldn't pass an extension in time. So maybe a little light here.
STEPHANIE ELAM, CNN BUSINESS CORRESPONDENT: Yeah, Tony, and this is really important for a lot of people in this situation.
HARRIS: Yes.
ELAM: But when they did pass it yesterday, now it has to go on to the House. And the bill extends federal unemployment benefits until the end of the year. Right now, states give out unemployment checks for the first six months. Then the federal benefits kick in. Those can last up to a year and a half. But they are divided into tiers. So you have to reapply every time you move into a new tier. And this bill also allows you to keep reapplying, Tony.
HARRIS: As you know, we've been focusing a lot on unemployment. But this bill actually includes a lot more than that. What else is in this bill? ELAM: Yeah, that's right. This bill is going to cost up to 150 billion dollars, so it includes a lot of stuff. It extends the federal subsidy for COBRA health insurance, which really brings down the cost of health coverage for folks who have lost their job. They're able to retain the health coverage they've had for a period of time.
It keeps Medicare reimbursements in place. And doctors would see reimbursements fall by 21 percent. And some say that could lead some doctors to stop accepting Medicaid patients altogether.
The bill also includes a lot of tax provisions. Here are some of the examples: credits for making energy home improvements, and also tax deductions for teachers, and also a research credit for businesses.
So the bottom line here is that this bill is a stimulus of sorts because it keeps more money --
HARRIS: Yes.
ELAM: -- in people's pockets, Tony. So that's obviously what we want to see.
HARRIS: Hey, you're watching the markets for us. What's happening today?
ELAM: Yeah, kind of doing some of that flat-line dancing that we talked about. Stocks really haven't moved a lot today, and pretty much you can say that for the entire week. Investors are waiting for more economic reports that will hopefully show the recovery is moving along. But there isn't much on the calendar this week.
But going into the day, the Dow was actually just up one whole point. So, like I said, not a lot of movement. Right now, the Dow is off 18 points, 10,548. NASDAQ off a quarter of a percent, at 2352. Of course, you can from the markets and the jobs bill on CNNMoney.com. We got you covered, Tony.
HARRIS: Thank you, Stephanie. Need that.
ELAM: Sure.
HARRIS: Hate disguised as religion. A CNN journalist sees it firsthand.
(BEGIN VIDEO CLIP)
CHRISTIAN PUREFOY, CNN CORRESPONDENT: OK, we've got the police, who are staying back, as they start shooting. And also right now, me being there will only make that situation worse.
(END VIDEO CLIP)
HARRIS: Whoa. Attacks and retaliation between Muslims and Christians in Nigeria.
(COMMERCIAL BREAK)
HARRIS: Let's get you caught up on our top stories now.
President Obama is getting ready to meet with members of both the Congressional Black and Hispanic Caucuses over health care reform.
Meantime, leaders of the House and Senate say Democrats are closing in on the final agreement. The president is urging an up- or-down vote.
The woman accused of killing three of her co-workers is no longer employed at the University of Alabama, Huntsville. A university spokesman said Amy Bishop has been fired effective February 12th. That is the day police say the biology professor shot six fellow staffers during a faculty meeting.
NFL star and actor Merlin Olsen has died at age 69. He was one of the Los Angeles Rams' Fearsome Foursome linemen during the 1960s. Olsen found a second career in Hollywood, starring in "Little House on the Prairie" and "Father Murphy." He was named to the NFL Hall of Fame in 1982.
I got to tell you, we are witnessing a deadly clash of Muslims and Christians in Nigeria. Their religious hatred being fueled by political and ethnic rivalries, mixed with poverty. It has resulted in hundreds of men, women and children, even babies, being butchered this week near the central city of Jos. Our Christian Purefoy was there when a fellow journalist came under attack.
(BEGIN VIDEOTAPE)
PUREFOY (voice-over): For outsiders, it's difficult to tell who is who here. But Nigerians can pick up on the tiny clues of accent and dress to figure out who is Christian and who is Muslim, and, by extension, who is unwelcome here.
(on camera): OK, there's a Muslim journalist here on the scene. Things getting out of control.
(voice-over): I've seen plenty of street fights in Nigeria before, but this is different. The Muslim man in the black shirt with red sleeves, he's the journalist. It quickly became apparent that these young men wanted to kill him, a reporter for the national radio station Radio Nigeria, because he was Muslim. Like others at the scene, trying to help, I felt I couldn't stand by as another man was beaten to death in front of me.
But I was simply ignored, and the situation got quickly out of control.
(on camera): If they start shooting, just stay here. OK? OK? We've got the police. But we're staying back. If they start shooting -- and also right now, me being there will only make that situation worse.
(voice-over): Worse because I'm an outsider, and these young men have a point to prove.
(on camera): This is the situation that the Nigerian authorities are worried about, spiraling completely out of control. The situation here is extremely tense.
(voice-over): The police wade into the crowd. They have weapons.
(on camera): Recording, recording, recording. No, we stay here. We're OK. Keep recording. We don't want to get anywhere near those guns. Stay with us.
(voice-over): And they fire into the air to disperse the crowd. To avoid making things worse, we stay back. The radio reporter is rescued, but not before he is badly beaten. He's taken by police to the hospital.
Christian Purefoy, CNN, Nigeria.
(END VIDEOTAPE)
HARRIS: Oh, boy.
Earlier this week, Israelis and Palestinians agreed to go back to the negotiating table, but now that may not happen. We will look at the latest stumbling block to peace in the Middle East.
(COMMERCIAL BREAK)
HARRIS: Seeking peace in the Middle East; Vice President Joe Biden has been hopscotching the region this week, meeting various leaders, trying to get talks back on track. Listen to what he had to say at Tel Aviv University yesterday.
(BEGIN VIDEO CLIP)
JOE BIDEN, VICE PRESIDENT OF THE UNITED STATES: In President Abbas and Prime Minister Fayed, men I have known for a long time, Israeli leaders finally have willing partners who share the goal of peace between two states, and have the confidence to establish a nation.
But, instead, two days ago, the Israeli government announced it was advanced planning for new housing units in East Jerusalem. I realize this is a very touchy subject in Israel, as well as in my own country. But because that decision, in my view, undermined the trust required for productive negotiations, I, at the request of President Obama, condemned it immediately and unequivocally.
(END VIDEO CLIP)
HARRIS: CNN's Paula Hancocks joining us from Jerusalem. Paula, this move to build more settlements, the announcement coming, what, hours after the vice president had essentially reaffirmed support for Israel, really seemed like a slap in the face to the United States. What explains it?
PAULA HANCOCKS, CNN INERNATIONAL CORRESPONDENT: Absolutely. It was seen here on the ground as a slap in the face by most Israelis. They were mortified by what had happened, and they were surprised by what had happened.
What the Israeli Prime Minister's Office is saying is that the timing was unfortunate. They didn't actually mean to announce this and to push these settlements forward at this time.
But the fact is, if you're slapped in the face -- if someone says, oh, we didn't mean to do it at that time, you are still slapped in the face. It's still embarrassing and it still smarts a little. So certainly it was an absolute fiasco. It was an embarrassment for the Israeli government, especially at a time when the vice president was talking about the worries of a nuclear Iran. He was saying exactly what the Israeli government wanted to hear. And then they came out with this. It really could not have come at a worse time. Tony?
HARRIS: Paula, what is, if you could characterize this for us, the state of US/Israeli relations at the moment?
HANCOCKS: The special friendship is still a special friendship. In that speech we heard a little bit of today, to students at Tel Aviv University, he did talk very warmly about Israel and said that it was an unbreakable bond. And he also said that sometimes it only takes a true friend to actually tell the harsh truth.
So Mr. Biden believes that he was able to condemn what Israel had done because they were so close. So, certainly no one believes that this special friendship has been jeopardized in any shape or form. What has been jeopardized is the indirect talks between the Israelis and the Palestinians, which look like they won't even start -- they won't even happen before they were supposed to start, Tony?
HARRIS: And Paula, so the timing on the announcement of the expansion of new settlements, that might have been bad, some would go worse than bad. But the intent seems very real. Is the Obama administration asking too much here?
HANCOCKS: Well, the Obama administration is asking for peace talks to resume. And this is what everybody here on the ground wants as well. They're very cynical on both sides, because we have been here so many times before.
But the fact is, even though the US was hailing it a success that indirect talks were about to start, they are still indirect talks. For the past 20 years, the Israelis and Palestinians have been having direct talks. And at this point, they can't even sit in the same room and negotiate. It's up to Senator George Mitchell to be shuttling in between the two sides.
HARRIS: Wow.
HANCOCKS: So, no one really thinks that the Obama administration is asking too much. It's just, at this point, they don't even seem to be able to get the indirect talks, which was, quite frankly, the bare minimum, Tony?
HARRIS: Paula Hancocks for us in Jerusalem. Paula, thank you.
Very quickly, I want to take you back to the ceremony for the World War II memorial. And we understand the wreath-laying ceremony is about to take place. We -- let's stay with the shot for just a moment. It just happened? It just happened. OK, live pictures from Washington, DC, for you.
Still to come in the NEWSROOM, students learning a tough lesson in economics. Find out what some of them were cut to deal with shrinking budgets. Carl Azuz of CNN Student News joins me next.
(COMMERCIAL BREAK)
HARRIS: You know, it is a math lesson students would probably prefer not to learn -- budget cuts, subtracting money, adding up to fewer classes and programs. Carl Azuz is the anchor of CNN's "Student News."
Good to see you again, sir.
CARL AZUZ, ANCHOR, CNN "STUDENT NEWS": Thank you for having me back.
HARRIS: Hey, look, going to have you back a lot here because we want to know what your audience, your students are saying to you.
Do you have a way of measuring how much of your audience has been affected by the recession?
AZUZ: We do. We've set up a quick poll at cnnstudentnews.com. It's not as scientific as the CNN/Opinion Research Polls that you guys have used, but the quick poll kind of is a barometer. It gives us an idea of what students are saying. And we asked them, has your school been affected by the recession. And so far today, our latest numbers indicate around 56 to 57 percent of them say it has.
HARRIS: Yes. Yes, that's going to grow, I think. I think as we get farther down the road here, we talk about budgets for next year, I think that number will grow.
What programs would students, if they had a vote, what programs would they cut?
AZUZ: A very tough question.
HARRIS: Yes. AZUZ: We don't want them to just think as the victim.
HARRIS: Yes.
AZUZ: Like, this has been cut. I'm missing out on bus rides.
HARRIS: Right.
AZUZ: We put them in the position of school official, school administrators and said, you know, what choices would you make if you had to make those?
Our first comment today comes from a student named Kaitlyn. She writes in, they don't need the smart boards. There are other students saying that. They're saying that the old projectors work fine. So did a regular white board. And if she were in charge, she'd cut back on what she calls "the pointless spending of fancy electronics."
HARRIS: Nice. Nice. Nice.
AZUZ: Another student named Joseph also wrote in on our blog. He's talking about getting rid of sports. And he's saying, we don't need those. We need to focus on academics. He'd stop putting millions of dollars in football and basketball. Very controversial.
HARRIS: That really is.
AZUZ: So many of them play the sports.
HARRIS: Yes.
AZUZ: But, you know, we saw all kinds of responses ranging from bus routes, students agreeing that some of those bus routes need to go. We had other students talking to us that they'd cut the exploratory classes. The band, drama and art.
HARRIS: Yes.
AZUZ: Some said sports and --
HARRIS: They round -- those programs round out the whole child.
AZUZ: Uh-huh.
HARRIS: But these are difficult times.
AZUZ: Very difficult. And I want to say, Tony, most of the students did agree they liked the idea of the four-day school week that we've been talking about. They like that, but they want to have their change and eat it, too. They don't want longer hours, just four days.
HARRIS: Yes, yes, I knew that would be the tradeoff.
All right, Carl, will you keep us posted. When you get more information from the students, hearing their voices as you do, let's get more of it in the program here.
AZUZ: Absolutely.
HARRIS: Appreciate it.
AZUZ: My pleasure.
HARRIS: Thank you, sir.
So, how do we find a way to get out of this education mess, this morass, this crisis that we're in right now? You know, we've talked about the drastic things happening in Missouri, Rhode Island and many other states. Schools are really hurting right now. Some are trying to get their hands on federal stimulus dollars. Let's see how that's going. Josh Levs is on the CNN Stimulus Desk for us.
And, Josh, what are schools doing to try to find that money?
JOSH LEVS, CNN CORRESPONDENT: Well, you know what, they're really fighting for it. I mean, in fact, Tony, the competition for the money just might be fueling some of these big steps that we're seeing in these schools around the country. There's a stimulus-funded program that's called Race to the Top. And we'll show you a quote here from the Education Department. They're calling it a "$4.35 billion effort to dramatically re-shape America's educational system."
Now, 40 states applied to get some of that money. And last week, the Department of Education pared it down to 16 finalists. You've got 15 states and D.C. that are still in the running. Later this month, they're going to go to D.C. to argue why they deserve some of that money.
And, you know, to get to this point, they had to show they were taking stems to turn schools around, especially the lowest-performing ones, and only have high-quality teachers. So, case in point, Rhode Island, which made headlines, as you know, last month. The Central Falls School District fired every teacher at its high school after it was designed one of the worst in the state. Today, the school superintendent is meeting with the teachers union for the first time since that decision to see if they can negotiate a way out of so many job losses.
Rhode Island's education commissioner has been saying for months, Tony, that getting stimulus money for the schools was a priority. And that drastic measure might have helped them earn a finalist spot in this Race to the Top for that money.
Now, Missouri did not make the cut, but states get a second chance to apply for stimulus money in a couple months. And now the step Missouri has taken, closing down nearly half the schools in that one Kansas City district, it just might help them. Officials in Kansas City are saying that by getting rid of a bunch of schools, they can improve the quality of the ones they're keeping.
And, Tony, the federal government is looking for stuff like that. They're looking for big steps in deciding which states can get some of those billions.
HARRIS: All right. We're talking about billions here. We're talking about a lot of money.
LEVS: A lot of money.
HARRIS: How much money will be doled out?
LEVS: Well, even though the program has $4.35 billion, only about half of it's going to be used for now. So roughly $2 billion for now.
HARRIS: Well, help me here for a second here. The stimulus is supposed to be about creating jobs. I know there's a part that says saving jobs as well. Do we know how many jobs might come from this?
LEVS: Well, you know, they can't say yet. And I guess there really could be some irony here, because we're asking right now, will firing teachers help a school district ultimately get some of that stimulus money, which is supposed to be about creating and saving jobs.
But I'll also tell you, to be fair, this is just part of a much bigger pie. The Education Department got $100 billion out of that stimulus, Tony. And they're telling me about 300,000 positions have been funded so far.
And, look, we want to hear from all of you about there about your schools, your kids' schools.
HARRIS: Yes.
LEVS: We've got a conversation going on my blog, cnn.com/josh. We're talking about it on FaceBook and Twitter, JoshLevsCNN. And, of course, any time you have anything to say that's relevant about anything at all --
HARRIS: Yes, anything.
LEVS: The best Web site to go to in the world is cnn.com/tony.
HARRIS: You're the man. Josh, appreciate it. Thank you.
The Securities and Exchange Commission may have missed Bernie Madoff and failed taxpayers, but it is a new day now. Poppy Harlow reports on the new cops on the Wall Street beat.
(COMMERCIAL BREAK)
HARRIS: Checking top stories now.
The school board of Kansas City, Missouri, voted last night to close 28 schools to offset a massive budget shortfall. The school superintendent said the district was spreading itself to thin trying to educate 17,000 students in 61 schools.
Buying American. President Obama wants U.S. exports doubled in five years to boost the economy and create more jobs at home. He is calling for a mini cabinet to promote exports and millions in funding from Congress to support that effort.
One person is dead, at least three others injured after three powerful tornadoes ripped over the central part of Arkansas last night. More than 20 homes were either damaged or destroyed.
(COMMERCIAL BREAK)
HARRIS: I need you to reach out to the program. I need you to talk to me directly. A couple of ways that you can do that. First of all, cnn.com/tony takes you directly to this, bam, our blog page. If you'd like to send us your thoughts on FaceBook, here's what you do, TonyHarrisCNN. Here's my Twitter address, TonyHarrisCNN. Call us, pick up the phone, 1-877-742-5760. Let's have more of your thoughts on the program, CNN NEWSROOM with Tony Harris.
(COMMERCIAL BREAK)
HARRIS: So, tomorrow marks the one-year anniversary of Bernie Madoff's guilty plea. When the shock of Madoff's scam started to fade, the finger of blame was jabbed at the agency that let it happen. After dodging widespread calls to be shut down, the Securities and Exchange Commission has a change of guard and a fresh start. Cnnmoney.com's Poppy Harlow reports.
(BEGIN VIDEOTAPE)
SEN. CHRIS DODD (D), CONNECTICUT: How did this happen?
SEN. CHARLES SCHUMER (D), NEW YORK: How the heck did this happen?
UNIDENTIFIED MALE: Massive, complete, total bureaucratic incompetence.
POPPY HARLOW, CNNMONEY.COM: The Securities and Exchange Commission was a product of the new deal era after the stock market crash of 1929. But in the most recent financial crisis, the SEC missed the biggest financial fraud in history, Madoff. But there are new sheriffs in town. Call them the top cops of Wall Street. And they say this time things will be different.
ROBERT KHUZAMI, SEC DIRECTOR OF ENFORCEMENT: We took the lesson of Madoff to heart, to a very great degree.
HARLOW (voice-over): You could call Robert Khuzami the enforcer. He's tasked with uncovering fraud and bringing charges against alleged perpetrators. He's had to recruit some of Wall Street's top talent without the promise of big paydays. To catch the next Madoff, the SEC needs people who know the game inside and out.
HARLOW (on camera): How do you pick them? Can you give me your pitch to maybe a top Wall Street trader?
KHUZAMI: It's not that hard to sell.
HARLOW: Really?
KHUZAMI: Because a lot of people want to be on the right side.
HARLOW (voice-over): But the challenges for regulators are mounting. The number of investigations has doubled in the last year, and they're more complex than ever before. Henry Hu is the man charged with monitoring them as head of the SEC's first new division in nearly four decades.
HENRY HU, DERIVATIVES INVESTIGATION CHIEF: Part of what this division is all about is bringing in these fresh insights, these new skill sets, to people who understand these derivatives and other financial -- complex financial products of today to better protect investors.
HARLOW: But the SEC is woefully underfunded. Its budget, $1 billion, a mere drop in the bucket, some would say, to police today's multi-trillion dollar securities market.
HU: We're terribly underresourced.
HARLOW: And despite a push for regulatory reform from the Obama administration, for now it's still an old, outdated system that just can't keep up with an ever-changing market.
HU: We are at an absolutely critical time in terms of that. What happens in Washington over the next year or two might dictate financial regulation, or economy, for the next half century.
(END VIDEOTAPE)
HARRIS: OK, Poppy Harlow joining us live now.
And, Poppy, I hear the talk, but what concrete steps is the SEC taking to gain back the public's trust?
HARLOW: They have so much they still have to do, Tony. This is the agency that had a whistle-blower come to them four times and basically gift wrap Madoff and deliver him, and they ignored the whistle-blower.
HARRIS: Yes.
HARLOW: So what they're doing now is they have legislation in front of Congress trying to get approval to pay whistle-blowers for their tips.
And this is sort of a classic law enforcement measure that we've seen. And Rob Khuzami, the man that we profiled, and you see him right here, he is the one who -- he was a prosecutor here in New York, Tony, fighting mobsters, fighting terrorists for more than a decade. So he used some of those lessons and he says he's using those to take on these criminals that are violating securities law. So a lot of lessons learned there, but still a long way to go to prevent another Madoff, that is for sure.
HARRIS: Oh, yes. All right, Poppy, appreciate it. Thank you.
HARLOW: You got it.
HARRIS: Let's take a break. We're back in a moment. You're in the CNN NEWSROOM.
(COMMERCIAL BREAK)
HARRIS: You know, a bill usually doesn't become law until earmarks are tacked on. That's just the way Washington works, right? Well, this week the Democrats and Republicans are swapping promises to end earmarks? Let's get straight to our congressional correspondent, Brianna Keilar.
Brianna, a Republican announcement on cutting back earmarks. What is this?
BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: Yes, and followed by a Democratic announcement just the day before. What you have going on, Tony, is some oneupmanship between Democrats and Republicans trying to take on these earmarks, which you know a lot of them, Democrats and Republicans, have fiercely defended. There are these lawmaker requests for fundings that then go towards specific, you know, projects and purposes.
HARRIS: Uh-huh.
KEILAR: So what you had today, just a short time ago, is Republicans, the top Republican in the House, John Boehner, saying that Republicans are proposing a total ban on for-profit earmarks. This comes on the heel of an announcement yesterday from the Democrat in charge of spending in the House that would have been a ban on earmarks for for-profit companies.
HARRIS: Right.
KEILAR: So this Republican proposal is a little more widespread. It would also include not just the earmarks that go to for-profit companies. It would also be earmarks that go to, say, non-profits, universities, states, that kind of thing. And you can see it's just sort of they're going back and forth trying to appeal to you, an American electorate that's fed up with government spending.
HARRIS: Well, all right. Both sides firmly on topic here. But would either of these really stop all the earmarks?
KEILAR: No. And, actually, both of them, if you were to apply them to some of the past earmarks that we consider so egregious, that really symbolize really kind of ridiculous earmarks, neither one of them would get in the way of that. For instance, you know that bridge to nowhere, Tony, that
HARRIS: I was just thinking that, yes.
KEILAR: Yes. This is the one we always talk about. Republican- requested bridge to nowhere in Alaska. It wouldn't touch that because that was actually put into a highway bill and not one of these spending bill.
HARRIS: OK, this isn't the only announcement Republicans made today, Brianna. They also hit Democrats, I understand, of recent let's call them ethic woes.
KEILAR: Yes, that's right. You know former Democratic Congressman Eric Massa, whose resignation was effective as of Monday amid ethics issues possibly surrounding misconduct with male members of his staff. Well, what you had here was a one-two punch between the earmark thing and they're also pressing -- Republicans also pressing Democrats on Massa, saying they want to know how much Democratic members knew, what they knew.
They actually just read a resolution on the House floor. And so you can see they're just kind of doing a bit of a pile-on ahead of this November election. It's really ripe for Republicans and, you know, Democrats are trying to push back with this earmark issue.
HARRIS: All right. On Capitol Hill, our congressional correspondent, Brianna Keilar, for us.
Brianna, appreciate it. Thank you.
We're back in a moment. You're in the CNN NEWSROOM.
(COMMERCIAL BREAK)
HARRIS: You know, more and more American homeowners are finding themselves upside down in their mortgages, owing more than the homes are now worth. Maggie Lake reports on the growing trend to people cutting their losses and simply walking away.
(BEGIN VIDEOTAPE)
GLORIA, FACING FORECLOSURE: I want to get it over with. I want to move on.
MAGGIE LAKE, CNN CORRESPONDENT (voice over): Gloria, a resident of Queens, New York, is at risk of foreclosure. She's working with her real estate agent and bank to sell her home with the hope of paying off some of her mortgage. But the bank is taking months to approve the sale.
GLORIA: I still don't want to walk away. But if they're going to -- to waste many more months of my time, I may not have a choice. I don't know how much longer I can keep this up.
VICTOR BANKS, CENTURY 21 MILESTONE REALTY: The owners get to where they have no other choice than to walk away. Because, you know, they've -- they've tried to sell the house for the best price that they can get, and the banks continually say no to the prices.
LAKE: Banks are signing off on deals, but in some cases heavy volume and debate over pricing can make the process agonizingly slow, and homeowners stuck with underwater investments are walking away in growing numbers. BARBARA SHIRVANIAN, SHORE HOMES SHIRVANIAN REALTY: Now this house they just razed. I sold that for 1.5.
LAKE: Even in neighborhoods once untouched by foreclosure.
SHIRVANIAN: I felt better a year ago.
LAKE (on camera): Really?
SHIRVANIAN: Yes.
LAKE (voice-over): Barbara Shirvanian has been selling real estate in Monmouth County, New Jersey, for 25 years. An hour commute to Wall Street, the housing market has taken a big hit. But this downturn is different from anything she's seen before.
SHIRVANIAN: There's not the stigma of my home was foreclosed. They understand that the whole world has changed and they are just doing what they can to preserve their assets. It's like maybe making a trade for someone else. They'll try to cash out and hold on to their cash and then rebuy at a lower rate at some other time.
LAKE (on camera): It may be one of the biggest risks facing the U.S. housing market. One in four Americans now owe more on their mortgages than their homes are worth. One in four. Some people are starting to ask, does it make sense for all those people to continue to throw good money into a losing investment?
RANDY COHEN, NEW YORK TIMES "THE ETHICIST": Banks act in their own financial interests all the time. That's why they made these loans. A business might decide, well, we're going to shut this factory down. It's just not viable to run it. If the people on that side of the table can make a decision entirely for their own financial interests, then that's seen as moral, and, in my view it is, as far as we've gone. Why can't the homeowner do that?
LAKE (voice-over): So far the majority of consumers with good credit are still paying their mortgages. After all, bailing out leaves a black mark on your credit rating. Bankers also warn it could push mortgage rates up for generations to come.
UNIDENTIFIED MALE: If we get into a situation where abandonments become with an upside, they'll price for the risk in the mortgages and the cost of loans for those who will get mortgages going forward, not to say what it does to the borrower who is thinking about walking away.
UNIDENTIFIED FEMALE: I've done everything.
LAKE: A tough dilemma for stressed consumers doing their best to navigate the housing bust.
Maggie Lake, CNN, New York.
(END VIDEOTAPE)
TONY HARRIS, CNN ANCHOR: It is go time. CNN NEWSROOM continues right now with Ali Velshi.
