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Offshore Oil Rig Explosion; Banking on Reform; Greensburg, Kansas' Green Comeback

Aired April 21, 2010 - 14:00   ET

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

ALI VELSHI, CNN ANCHOR: Here's what I've got "On the Rundown."

It's supposed to be one of the safest places on Earth, with 1,001 safety measures in place. So why did an oil rig in the Gulf of Mexico blow up? I've been on these rigs. I know something like this is very rare. My question is, can it happen again?

Plus, this is a headline that staggered us "Paying Drug Addicts to Get Sterilized." Has the problem gotten so bad that this is the best solution we can come up with? One woman thinks so, and she's putting her thoughts into action. I'll talk to her.

Also, we could be on the verge of an unprecedented overhaul of the way we police Wall Street. It's not enough to have more regulations. We need the right kind of regulation. We need to make sure we don't over-regulate and we need to make sure that we actually police properly.

My thoughts on this in my "XYZ."

OK. One minute, operations were going smoothly. The next, a huge explosion ripped through an offshore oil rig in the Gulf of Mexico.

This is what it looked like on the Deep Water Horizon rig when the blast sent a column of fire into the sky last night. It happened about 50 miles southeast of Venice, Louisiana. Look at the dramatic U.S. Coast Guard helicopter rescue of one of the several workers who were injured.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: OK, we're taking a load.

UNIDENTIFIED MALE: It's clear.

(END VIDEO CLIP)

VELSHI: There were 128 people on the rig at the time of the explosion. Most of them believed to have escaped. Twelve are still missing. There's an urgent search under way.

I am getting some messages from you that some TV stations are reporting that the 12 have been found. We are in touch with the Coast Guard. We are not able to confirm that information. The Coast Guard says the rig was still burning this morning. It's tilting about 70 degrees and threatening to topple into the water. We need to point out to you that major accidents of any sort on an offshore oil rig are extremely rare.

Joining me to talk more about this from Houston is Greg McCormack. He's the director of the Petroleum Extension Service at the University of Texas. They've been training oil workers since the 1940s.

Greg, oil rigs, by virtue of the fact that they're out there in the middle of the water, not close to other facilities, not close to an easy rescue, have to be self-sustaining. And as I recall, fire is the biggest concern on an oil rig. A lot of their safety is built around not having fires and not having fires spread.

GREG MCCORMACK, DIRECTOR, PETROLEUM EXTENSION SERVICE, UNIVERSITY OF TEXAS: That's correct. Explosions and fires are probably the worst thing that could happen on an oil rig there, because you're in a very, very confined area. And so you're very vulnerable to that activity.

VELSHI: Let's talk about this. They have firefighters, trained firefighters, on the rigs at all times. Everybody gets a safety briefing every time they come on the rig, or every time they come on to shift on the rig. You can't smoke. You can't do things that are dangerous. And any time there's something called a hot job, the kind of thing that could cause a fire, there are firefighters on scene.

So, what could have gone wrong to cause an explosion?

MCCORMACK: What it looks like to me -- and I don't have all of the details. But what it looks like to me is they had a blowout.

That occurs when the formation pressure is higher than the mud that's holding that formation pressure back. That allows the reservoir fluids, either oil, glass or water, or a combination of all, to come to the surface.

When that happens, usually on top of the drill stem, you have what's known as blowout preventives. And those blowout preventives are supposed to be activated to contain the reservoir liquids, the hydrocarbons. It appears in this case they did not function.

VELSHI: Is that common? Have you ever heard of that not functioning to the point that it causes an explosion like this?

MCCORMACK: I have heard of it occurring. I have heard of the blowout preventives not being installed properly. I cannot believe in this case that would have occurred. Transocean is one of the safest, most well-trained drilling companies offshore that I know of.

VELSHI: Typically speaking -- so what you're talking about is something that would have combusted and caused an explosion immediately. In other words, not a danger of a fire that set that they couldn't control that then caused an explosion. Because generally speaking, rig workers can handle a fire.

MCCORMACK: Rig workers can handle a fire on a rig. But what happens in this case, when the hydrocarbons, the oil and the gas, reach the surface, what they try to do is contain that, and they will do measures to contain that. But if they're unsuccessful, there's a lot of hydrocarbon vapor around looking for an ignition source. When it finds that ignition source, you're going to have an explosion and a fire.

VELSHI: Now, I don't know if you saw the pictures we showed. We had a still photograph showing a fire, just fire, going straight up in the air.

What's burning there? Is that the oil? Is it the natural gas? And is that going to stop burning?

MCCORMACK: It's a combination of oil and gas. It looks to me more gas than oil just by the color of the smoke there.

It won't stop burning until the pressure in the reservoir is low enough that you don't have enough energy to come to the surface. If there's a lot of gas there, it could burn for a long time.

VELSHI: All right. What happens when this sort of emergency -- some kind of alert happens on the rig? Tell me what would happen. If you're on a rig and something explodes, what's supposed to happen?

MCCORMACK: You have been well trained to abandon the rig. They're supposed to go to their stations. Then each of these stations have life-protective gear, and they also have the lifeboats.

Because you're approximately anywhere from 50 to 100 feet above the water, you don't want to be dropping into the water. You want to be lowered into the water. And you get on these lifeboats, and you are lowered into the water.

VELSHI: And there's some hope that these 12 who are missing are on one of these lifeboats at some point. Would they not be able to communicate with somebody if they're on a lifeboat?

MCCORMACK: There's a possibility they could communicate, and there's also a possibility that they're unable to communicate. I have heard that -- from some of our people in Louisiana that all -- everyone is accounted for. It is my hope and prayer that that is the case.

VELSHI: It is ours, too, and we've been hearing those reports. We are in touch with the Coast Guard, who is not able to confirm that, unfortunately. But as soon as we learn anything, we'll let you know.

Greg, thanks very much for being with us and sharing your knowledge of this with us.

Greg McCormack is the director of the Petroleum Extension Service at the University of Texas in Houston. All right. Big money, bare-knuckle, outrage in the electorate. The financial reform debate has it all, and I'll break it down with our senior political analyst, Gloria Borger, after the break.

(COMMERCIAL BREAK)

VELSHI: Tomorrow, President Obama goes to Wall Street, and the timing for him probably couldn't be better. Americans hold a dimmer view of hedge fund traders and exotic financial instruments than they do members of Congress.

The Wall Street titan Goldman Sachs now stands accused of fraud by the SEC. And just days after declaring their unyielding opposition to financial regulatory reform, Senate Republicans are softening up a bit.

Just today, the Senate Agriculture Committee passed a bill that would regulate so-called derivative trading even more than the White House would. And a Republican Senator, Chuck Grassley of Iowa, voted in favor of it.

Now, granted, to comprehend the finer points of the financial stuff, you might need an MBA. To grasp the politics, we turn to CNN Senior Political Analyst Gloria Borger.

Gloria, this is not the same as -- it's very important, but not the same as the health care debate. Has the president taken some of the lessons of that very, very difficult battle into this?

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: You know, I think he has, particularly last week, when Republicans sort of came down on him and said, you know, you're pulling out the rug from under us, this isn't working. I think the White House decided, unlike health care reform -- and they say -- when you talk to folks at the White House, they say their hands were tied in health care reform, the Hill was writing the bill, they were sitting at the table with the insurance companies. This time, it took about a nanosecond for the White House to respond.

The president responded very strongly in his Saturday radio address, as you point out. Thursday, he's going into the lion's den on Wall Street.

I was speaking with somebody at the White House this morning who said this is going to be a strong speech -- not surprisingly, the White House says that -- but that the president will outline the consequences of inaction, and he's going to "take on the myths being peddled by the Republican leadership." So, this is not someone who's backing down from a fight.

And the folks in the White House say this is easier. David Axelrod told me -- he said, "Our goal is to be as aggressive as possible." And, of course, Axelrod is a top adviser to the president.

VELSHI: All right. So, there's some softening. There's still some big debate on how to regulate derivatives. By the way, I think somebody suggested that maybe I'm using derivatives as a drinking game on this show, I've said it so many times today.

(LAUGHTER)

VELSHI: But there might be three reasons why some of the opposition to this seems to be softening a bit.

Now, one, I guess, could be that we're just more bipartisan after health care. I don't know.

BORGER: No. No.

VELSHI: Number two is we've got polls out there that show Americans really favor regulation of Wall Street, even though they don't favor more government regulation of anything else.

And number three might be this charged against Goldman Sachs that the SEC brought.

What is making Republicans -- I mean, do they just not want to be on the wrong side of this?

BORGER: Well, that's right. And let me add a number four here, which is that the Republicans in the Senate are divided on this.

The Senate leader got them all to sign on to this measure that forced Democrats to go back to the negotiating table. Fine. But there were lots of Republican senators I spoke to who weren't willing to say we're going to filibuster, because they can read the polls just as well as you can. And people don't trust the government to do anything these days, but they do want the government to regulate Wall Street.

And so they don't want to be on the wrong side of this. And by the way, Ali, there are a lot of them -- you've interviewed a bunch of them on your show -- who have been working on this measure for months and months and months. You know --

VELSHI: Right.

BORGER: -- people may have a sense that this is just happening now.

VELSHI: Right.

BORGER: But actually, Republicans have been working with Democrats to try and get this done.

VELSHI: Yes, that's true. And the House measure passed in December.

BORGER: Yes.

VELSHI: I talked to Senator Judd Gregg earlier.

BORGER: Exactly. VELSHI: Generally speaking, you're not finding Republicans who just say there should be no regulation of anything. There's a big part this thing that does have bipartisan support.

BORGER: Right. But you know, what got the White House all outraged was the use of the word "bailout."

VELSHI: Right.

BORGER: Right? Because if you're going to road-test a word that most people in the American public hate more than anything, it's going to be a bailout for banks.

VELSHI: Yes.

BORGER: And when Republicans started portraying this as a bailout for banks, that's what got the White House's back up.

VELSHI: That said, there is, depending on which bill you look at -- some are between $50 billion and $150 billion set aside for something. You could call it an emergency fund, you can call it a slush fund, or you can call it a bailout. There is money being set aside, and some are worried that that's going to send the message out there that there is some money if you guys do the wrong thing.

BORGER: But the question is, where does that money come from? Does it come from the banks or does it come from the taxpayers, right?

VELSHI: Yes.

BORGER: And is it just a way to help very sick companies die so you don't have a panic on the banks?

VELSHI: Yes.

BORGER: Right? I mean, that's what the Democrats would say. Republicans would say it makes it more attractive --

VELSHI: Right, to take risks.

BORGER: -- for banks to die, right. And to take risks.

VELSHI: Very interesting. It's worthy of all of the discussion that is happening right now, because whatever happens is going to affect us for years to come.

BORGER: And, Ali, I'm going to tell you, I do think they're going to get a bill. And I think you could see it with 70-plus votes in the Senate.

VELSHI: That would be very, very interesting.

BORGER: We haven't seen that. Yes.

VELSHI: A good, important bill that gets bipartisan support and that does actually satisfy conservatives that it is addressing some of those concerns, I think would be a remarkable victory for this White House.

Gloria, good to see you. Thank you.

BORGER: Sure. Good to see you.

VELSHI: Gloria Borger is our CNN senior political analyst, and a good friend of our show.

All right. Their town was torn apart when a tornado blew through it years ago, but this Kansas town put the pieces together in a green way.

We're going to take you there on the CNN Express when I come back.

(COMMERCIAL BREAK)

VELSHI: Next month marks the third anniversary of a tornado that nearly wiped out the small town of Greensburg, Kansas. But the town has now come back. And by building itself up, it's also "Building up America."

Tom Foreman visited on the CNN Express.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT: Hey, Ali. I want you to take a look at this town, because it is truly unique in America right now. They have had to build up in two separate ways.

First of all, they had to recover from the devastating storm that laid waste to all of the buildings that used to be here. And secondly, they had to do it when so many places, especially small towns, are struggling just to survive.

(voice-over): The tornado that ripped through Greensburg three years ago was a swirling black cloud with winds exceeding 200 miles an hour. And it left this small town in ruins.

DANIEL WALLACH, GREENSBURG, GREEN TOWN: It was a 1.7-mile-wide tornado. And the town is 1.5 miles wide. So there was just very little on the peripheries that survived.

FOREMAN: But the storm of rebuilding that Daniel Wallach and others have led since is proving just as powerful, only this one is green.

WALLACH: And so this town knew they had to have a unique identity.

FOREMAN (on camera): That's what you set out to do with this plan?

WALLACH: Yes.

FOREMAN (voice-over): With the strong backing of the local government, this town is being rebuilt as a model of environmental sustainability. At the new school, drainage systems capture and conserve rainwater to feed the landscaping. Salvaged wood covers the walls. Cabinets are made of wheat harvest leftovers. And natural light pours in everywhere.

Superintendent Darin Headrick is expecting much lower power bills.

DARIN HEADRICK, SUPERINTENDENT: During the day we won't even turn lights on here to have classes and activities during the day. Our classrooms are the same way. We really don't know if we'll have to turn a light switch on during the day for the classrooms.

FOREMAN (on camera): That's a big savings.

HEADRICK: Well, we hope.

FOREMAN (voice-over): One of the town's many new wind turbines generates up to 30 percent of the new hospital's electricity, while power and water saving utilities dominate. Mary Sweet runs the place.

(on camera): Were you skeptical of this idea to begin with?

MARY SWEET, KIOWA COUNTY MEMORIAL HOSPITAL: Initially I was, yes. At first I thought it was a gimmick, it was a way to build back and have people help us. But like I mentioned it's a roadmap of a way to follow in construction.

FOREMAN: And you think it's working now.

SWEET: It's working wonderfully, yes.

FOREMAN (voice-over): And all over town, houses are springing up with eco-friendly designs like this model made of concrete filled with smart utilities feeding off solar cells, a machine that pulls drinking water from humidity in the air, and so much more.

(on camera): What's going on up here?

UNIDENTIFIED MALE: Well, up here we have the rooftop garden.

FOREMAN: You're going to grow food for the house right up here.

UNIDENTIFIED MALE: Yes. Absolutely.

FOREMAN (voice-over): The payoff? By most accounts this was a small dying town before the storm. But with each new stage of the green comeback, it is being reborn. And every day fewer folks are looking back.

UNIDENTIFIED MALE: With a name like Greensburg, you know, it was a natural fit.

FOREMAN (on camera): There are still plenty of empty lots around town, but what they're hoping here is that eventually, they will rebuild the entire town, and what they will rebuild will actually be economically stronger and more viable into the future than the town they lost -- Ali.

(END VIDEOTAPE)

VELSHI: All right. Tom keeps on going across America on the CNN Express.

Let me give you a look at the top stories this hour.

Civil rights leader Benjamin Hooks is being laid to rest this afternoon. He died last week in his Memphis home.

Hooks was the first black FCC commissioner until leaving to head the NAACP. Membership grew to several hundred thousand under his tenure.

His funeral is being attended by political and civil rights leaders.

That volcanic ash cloud continues to create problems for travelers. Some flights have started up again. Thousands of passengers are still stranded. It could take days or even more than a week for everyone to get home. And airlines who have lost at least $1.7 billion are beginning the ash blame game on who pays and whether air space really should have been shut down for as long as it was.

And the U.S. Treasury released a new $100 bill today. That's the new one on the bottom. It won't circulate until next February. And, of course, you can keep on using your old bills.

Let's take a look at some of the differences.

You can see a blue line just right of Benjamin Franklin's 3-D security ribbon. It has images of bells. I'm assuming that's the Liberty Bell.

There's a yellow inkwell. You can see that right of the blue line. That bell changes color when the bill tilts. That's kind of cool.

On the far right, there's a circle-ish figure. It's a portrait of Benjamin Franklin if you put a light behind the bill.

The $100 sign on the front right of the bill, see it at the bottom? It changes color. On the back, that $100 is gold, the $100 sign.

Benjamin -- now look at the picture. Benjamin Franklin's left shoulder, it has raised printing on it that gives the bill some texture. Very interesting.

All right. When we come back, we saw some tornadoes, some big tornadoes, roaring through Texas. Look at that.

Can you imagine that? Imagine being face to face with this. Want to see if that's going to happen again today. We're going to check in with Chad. Then we're going to go "Off the Radar." There's going to be a big light show in the sky tomorrow. Chad has got details on the Lyrid meteor shower after the break.

(COMMERCIAL BREAK)

(WEATHER REPORT)

VELSHI: All right. Here is an interesting story that caught our attention, paying drug-addicted moms to go on birth control or get sterilized. It sounds like a good idea to some people. We're about to get an earful, I suspect, from both sides of this impassioned debate, including a woman who has turned her support of this idea into action.

(COMMERCIAL BREAK)

VELSHI: Of all the downsides to addiction, the worst may be the devastating impact on children. Babies born addicted to crack, fetal alcohol syndrome, neglect, abuse, there's no easy solution. There's a controversial charity, however, that's taking a shot at it. Project Prevention actually pays drug-addicted moms $300 to use long-term birth control or undergo sterilization. I'm sorry, it's not just mothers, it's anybody who is drug addicted. Critics have compared to it Nazi-style social engineering, calling it eugenics.

Joining us now from North Carolina is Barbara Harris, she founded Project Prevention. She says her aim is to simply keep addicts from having children that can't take care of and prevent babies from suffering.

In New York, Mary Barr join us. She is the founder and director of Conextions, which helps educate prisoners about addiction. She says paying addicts is not only ineffective, but also interferes with women's reproductive rights.

Thank you for being with us.

Barbara, let me start with you. Barbara, tell me -- tell me how this works. You go out and you find people who are addicted and you -- they can get their sterilization or their vasectomy, they can get that paid for by Medicare and you will give them an extra 300 bucks for doing it?

BARBARA HARRIS, DIRECTOR & FOUNDER, PROJECT PREVENTION: Right. The women actually are referred to us through social workers or jails, drug treatment programs, there's a variety of different ways they come to us. And they get paperwork and they have to decide what type of long-term birth control or permanent birth control is best for them. They go obtain the birth control, send the paperwork back to us. We verify that they did get birth control, and then they're paid.

VELSHI: And you pay them in installments?

HARRIS: If they get the tubal ligation or a vasectomy, it's onetime payment of $300. If they get the implant (ph) or IUD, it's payments every six months when they verify that the device is still in place.

VELSHI: Tell me, just in a short form, what your thinking is on this?

HARRIS: Well, I adopted four of eight drug-exposed infants to a Los Angeles drug addict, and at the time it seemed like everybody was complaining about the problem. Social workers, courts, everybody that I ran into was complaining about the fact that these women drop off the babies at the hospitals every year, but nobody was doing anything about it. So, I came up with an idea to pay irresponsible people to be responsible and it's working.

VELSHI: And you pay -- and you pay women and men?

HARRIS: Yes.

VELSHI: More women than men do this?

HARRIS: Yes.

VELSHI: OK.

Mary, you're on the other side of this equation. You -- you're a recovering addict yourself and you had children while you were an addict?

MARY BARR, FOUNDER & EXECUTIVE DIRECTOR, CONEXTIONS: Yes. And essentially what Miss Harris is saying is that people like me shouldn't have children, and that my beautiful children shouldn't exist today. My daughter just graduated one of the hardest high schools in the country. For those of you who live in the New York area, you might know of Stuyvesant High, and she scored so high on her SATs that her medical college is going is going -- the tuition's going to be paid in full, her scholarship. And I'm really happy she's around today.

VELSHI: So tell me, though, you've got a -- that's a great success story, and we congratulate her. It is excellent. That's a great high school and that's going to be a good future for her.

How would you say we -- we as a society should deal with people who are addicted to drugs, who do have children, who are born addicted to drugs or with defects? Is there something that society should be doing?

BARR: Well, definitely we need to have more treatment on demand. When I looked for help, and I did look for help, there were no programs for women with children. And the one I found had a waiting list of a year and a half. So, we definitely need to look in to other options for addicts besides help, prevention, parenting, all of these things can be done a lot cheaper and a lot more successfully.

VELSHI: OK. I want to take a quick break. I want to continue this conversation. Barbara Harris, you've been called -- you've been likened to Nazis. You've been -- you've been accused of eugenics. You've had some threats. I want to discuss why it's worth it to you and why you continue to want to do it.

We'll talk -- and continue the conversation with Barbara Harris and Mary Barr on other side of the break.

(COMMERCIAL BREAK)

VELSHI: OK. We're talking with Barbara Harris and Mary Barr about paying cash -- Barbara's charity pays drug addicts to go on long-term birth control or undergo sterilization. Mary educates prisoners about addiction and she says paying addicts is demeaning and doesn't work, and by the way, she had children while a drug addict.

I'm getting a lot of comments from Facebook which I'm going to read in a second. I want to ask you first, Barbara, you've had some pretty nasty things said about you. How does that make you feel?

HARRIS: I mean, I really have, but it doesn't bother me because I know what I'm doing and the reasons I'm doing it.

And for Mary to talk about her daughter in high school and doing well, and then I can bring up my oldest adopted daughter and say she's on the dean's list in college, but how does that help the 500,000 children that are waiting in American to be adopted whose parents weren't success stories?

For every one success story that you'll hear like Mary's, there's three that weren't successful. Seventy-five percent of women that give birth to drug-exposed infants don't come back to reclaim them.

VELSHI: Mary, Mary, let me ask you a question. I got this from Susan on Facebook, "There's nothing worse than another neglected child who will end up and get shifted around from family members to foster homes and back. We need to work harder on programs like this that will help prevent unfit people from reproducing."

Tough. What do you think?

BARR: Well, that's what I was going to say. Miss Harris might have been called some names, but think about people in recovery, especially women. The fact that we're mothers puts us at -- on people's blacklists all the time. Because you're a mother and you sin or do drugs, that makes it really worse for you. So, I don't feel as bad for her as I do for people in recovery that have to have these kind of stigmas attached to them.

And that's something else we do to the children, we stigmatize them and say that they are born, they have to necessarily have problems when they don't. There's no science that backs that up.

VELSHI: Barbara, you're nodding your head, you disagree with that.

HARRIS: Well --

VELSHI: Let's just talk about that specific thing that Mary just said, that there isn't science to back up the fact that children with addicts are born with problems.

HARRIS: Well, that's absolutely not true. I've seen many of the children that are in foster care who were born to drug-addicted parents who have tubes in their throats to breathe through, feeding tubes in their stomach. So just because a few make it out, what about those that don't?

I mean, that to me doesn't even matter. It's just -- its preventable and I think we should prevent it.

VELSHI: Let me ask you this, Trista on Facebook asks, "If someone is desperate for a fix and in the world of addiction would do anything for that fix, would it be ethical to perform an irreversible medical procedure on them, their judgment would be compromised?"

You yourself have said, Barbara, you give this 300 bucks to people and you believe many of them use that money for drugs?

HARRIS: If you can't trust these women with a decision, how can you trust them with a child? To me it's just common sense.

They don't -- all of the women that come through our program don't have a tubal ligation. The one that do have had numerous children and they don't want to have any more and that's their choice.

VELSHI: Mary, what's your -- that is an interesting point. If people are having difficulty making that sort of a decision, what do you do for women who are pregnant and they are drug addicted? Is there enough out there for them?

BARR: No, there isn't. I made lots of good decisions when I was using drugs. My best decisions were to go look for help, I thought. But instead of getting help, I was victimized actually by the social system that we have, because once I said that I used drugs --

HARRIS: She's the victim.

BARR: -- they thought that they had some right to take my children.

And, yes, I was victimized by the system, and so were my children because instead of giving me the opportunity to become an effective parent when I asked for help, they actually took away my option to be a parent, even if it was just for a time.

So, yes, we are victimized by the system, and the children are victimized when they're taken away from their parents. Especially when there's other choices, like having programs for women with children, which we still don't have enough of.

VELSHI: All right, I'm going to leave it there. Very interesting discussion. A lot of feedback on Facebook, we are interested in continuing to get your comments on this.

Barbara Harris is the founder of Project Prevention in Charlotte, North Carolina; Mary Barr is the founder and director of Conextions in New York. Thank you both for appearing today.

HARRIS: Thank you.

BARR: Thank you.

VELSHI: All right, I want to give you a check on some of the top stories that we're following here at CNN.

General Motors has repaid in full the loans from the U.S. and Canadian governments. The struggling carmaker got $8.1 billion in aid when it filed for bankruptcy last year. GM's CEO says the loan repayments, about five years ahead of schedule, shows it's on the road to recovery.

The Coast Guard is searching for at least 12 people missing after an explosion at an oil rig in the Gulf of Mexico. It happened last night, there's a picture of it, about 50 miles off of Louisiana. Seven people are critically injured in that blast.

A day before President Obama heads to Wall Street to speak about the need for financial regulatory reforms, the Senate Agriculture Committee has passed a bill that would regulate so-called trading in derivatives, even more than the White House would. Derivatives are the sometimes risky investments partly blamed for the financial meltdown. One republican senator, Chuck Grassley of Iowa, joined democrats in supporting the bill.

When we come back, Ed Henry, we're going to talk about the Supreme Court and most importantly, we are going to talk about that espresso maker that Tom Hanks promised that he was going to buy Ed and his colleagues at the White House. I have it on good authority it might be there, that's why Ed is looking so hopped up right now.

We'll be right back.

(COMMERCIAL BREAK)

VELSHI: There he is. OK, he looks very still. He doesn't look like a guy who has had a lot of coffee. We're going to talk about that in a second.

First thing we're going to talk about with Ed Henry -- by the way, every day you tune in, you see Ed Henry here. He's our man at the White House, you see him on TV, but he gives you a little extra something right now. So he's going to give us the inside story on the Supreme Court and who the president is going to pick -- Ed.

ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Yes, I was waiting for the music. You didn't have music on the way in.

VELSHI: It was strangely silent, wasn't it?

HENRY: Yes, you know, it was kind of anticlimactic.

VELSHI: It was a trick. A producer trick. HENRY: You know, I think what's interesting is the president came out today and what we saw in public is the fact that he was meeting with Senate democratic leader, Harry Reid, the republican leader, Mitch McConnell, as well as the chair and ranking member on the Senate Judiciary Committee. They're the ones who are going to have to deal with this nomination when the pick is ultimately made. And republicans already making noise about a filibuster, so this president wanting to show he's reaching out, he's consulting, he's listening, et cetera, et cetera, et cetera.

But what I thought was real interesting is after that public show, president went into the Oval Office and made nine phone calls to various senators, democrats and republicans, on that Judiciary Committee. He's basically -- this is the charm offensive. This is, you know, reach out and reach out over and over again, because they know republicans are laying the groundwork for a possible filibuster and they want to be able to tar the republicans as "the party of no" as they've done on health care and other issues, if they ultimately stand in the way of this nomination.

Because they want to show, look, this president's been out there from early on in the process, reaching out, getting ideas from all sides. But I think we're still at least a couple of weeks away from ultimately finding out who he's going to pick, Ali.

VELSHI: All right, in the meantime that may mean some long days and some late nights.

HENRY: Yes. And that's why, you know, Tom Hanks -- we were razzing him a couple weeks ago because you'll remember several years ago Tom Hanks was visiting the White House Press Briefing Room in there. I think it was in the Bush administration, several years ago. And he noticed there was no coffee machine. I think he wanted a cup of coffee, the way I heard the story, and he couldn't get one. And so basically a few weeks later, $1,000 espresso machine shows up in the Press Briefing Room with a note from Tom Hanks saying, you know, you got a long nights, all you guys, you get this espresso machine.

Well, Tom Hanks was here a few weeks ago, as you know, promoting "Pacific" on HBO. And he basically saw that this same old machine was there, it hadn't been updated and some of us were bugging him for a new one. And he said -- he promised he was going to do it the following week. We never got it.

We came here on the segment, we were prodding Tom Hanks. He finally delivered yesterday. You see the little video we have.

VELSHI: Yes, shiny new machine. Nice.

HENRY: This machine looks even more expensive than the last one. I haven't tried it yet, but I'm told it's quite good. And, you know, we want to give Tom Hanks a little credit here. He made a promise, he followed through on it. We were keeping him honest on it, it took a little longer than he said, but it showed up at the end of the day.

And I remember when he was here a couple weeks ago, he was sort of ragging on all of us in the press corps says we were a sorry bunch and we were pretty ragged and we could probably use some espresso.

VELSHI: The least he could do is give you good coffee.

HENRY: Yes. And I mean, you know, you're right, there's going to be some long nights with the Supreme Court battle ahead. Still, the president tomorrow is going to Wall Street, is going to be pushing Wall Street reform. I'm going there, and so I'll be in your old haunting ground there in New York, Ali. I'll say hi to all your friends.

VELSHI: I offered -- did I offer you a place to stay? I've got a place there.

HENRY: No. Actually, in fact, you didn't.

And you know, by the way, earlier I found out you were a good speller or something? I was watching --

VELSHI: Spell-check kind of ruined that for me.

HENRY: Downhill since then.

VELSHI: Yes ,it's been downhill since then. Well, if you need my place, let me know. I offered it to Richard Guest, too, so knock first, just to make sure.

HENRY: That sounds like a good idea.

VELSHI: All right, Ed, good to see you, my friend.

Ed Henry at the White House.

Listen, pretty awful job market greets the class of 2010, so some students are taking matters into their own hands creating a career where there's none to be found. What can we learn from these young entrepreneurs?

(COMMERCIAL BREAK)

VELSHI: It was the worst of times, it was the best of times. I'm not misquoting Dickens, that's pretty much the philosophy of the Kairos Society. It's a student group that could probably teach a lot of us about rolling with the recession.

Let's take it over to CNNMoney.com's Poppy Harlow. What is this all about?

POPPY HARLOW, CNNMONEY.COM: Well, did you start your own business in college, Ali?

VELSHI: I did not.

HARLOW: Nor did I. I was hitting the books and not partying at all, but these guys, a lot of them, started their own companies. And I got to tell you, what they did over the weekend here in New York at the New York Stock Exchange is all these college students of the Kairos Society came together, the entrepreneurs, they showed off 100 different companies, innovations, et cetera.

And I got to say, pretty impressive stuff. Take a look at what they came up with.

(BEGIN VIDEOTAPE)

ANKUR JAIN, FOUNDER, KAIROS SOCIETY: There's 100 companies being showcased today, and every one of these companies has been founded and is run by students.

PATRICK MURPHY, PRESIDENT, POWERFLOWER SOLAR: It's a PowerFlower, which is portable, durable, low-impact solar technology. A lot of people like the look of it, would love to have one of these in their backyard.

SHAAN PURI, CO-FOUNDER, WASABI SUSHI: We tried sushi for the first time a year ago and we just realized that we love it and we want to bring it to the masses.

JAIN: We started Kairos in 2007, which was right at the peak of the whole recession. And Kairos actually means "the right moment." And the premise was that there's no better time for these students to pursue the path of entrepreneurship, to take on their own risks and take control of their own destiny.

DUNCAN NIEDERAUER, CEO, NYSE EURONEXT: It shows you what the art of the possible is. Anything's possible, and to see what these kids are doing with the tools that are at their disposal, they're able to create businesses on the back of an idea much faster than we ever could.

ENRICO PALMERINO, CO-FOUNDER, THINKLITE: The easiest way to get a job is to create your own, and that was the whole entrepreneurship thing. That's why we're here at Kairos. The best way to stimulate the economy is to go out and make jobs for other people.

BENJAMIN GULAK, FOUNDER, BPG-WERKS: And we had a friend from back home, we started this all-terrain extreme sports company. It's essentially a skateboard with two snowmobile tracks underneath it. You can go through sand, snow, mud. You can take it off the side of a mountain.

If you really have something that you believe in or that you see potential in, you should go out there and just figure out a way to make it work and not let other people tell you what you can and can't do.

BEN LEWIS, FOUNDER, GIVE: Everyone drinks water, everyone has causes they care about. GIVE is a beverage brand on a mission. We donate 10 cents for every unit we sell to charity.

NIEDERAUER: I just want them to promise me that if and when they IPO, they do it here at the NYSE and they give me a call, even if I don't have the job, so I can join them.

(END VIDEOTAPE) HARLOW: Pretty impressive stuff, right, Ali? I mean, the only complaint these kids had is what every business has, the trouble finding financing from the banks.

VELSHI: Yes, and there are a lot of great ideas. I know you come across a lot of them at CNNmoney.com, you guys focus on a lot of great ideas. There are actually a lot of fantastic ideas out there and the problem is financing them.

HARLOW: Financing them, exactly, and I guess finding the time to do it while you're also studying for your tests in college. Pretty impressive stuff these kids are doing.

VELSHI: That didn't seem to be my biggest distraction for some reason.

HARLOW: Really?

VELSHI: Poppy, always good to see you. Thank you so much for joining us.

Poppy Harlow at CNNMoney.com. You can watch here all the time, by the way, go to CNNMoney.com.

All right, financial regulation, two words that might make your eyes glaze over, but there's no doubt we could be on the edge of unprecedented financial reform. Now, some people say we should charge forward with this. Other people say, we should back off, be careful. I'm kind of in the middle of this one, I'll tell you more about when I come back with my "X-Y-Z."

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VELSHI: Time now for "The X-Y-Z of It."

I want to imagine -- I want you to imagine the next best thing to winning a Powerball ticket. Imagine a way to make money off of investments that you never made, commodities you never owned and never planned to own -- oil, orange juice, the price of tea in China, the odds of an earthquake in Alaska, virtually anything. If you're a farmer, you can lock in the cost of your seed and the price at which you sell your crops and take some of the risk out of a hugely risky profession. If you're an airline you can bet on the future cost of jet fuel and make money whether it goes up or goes down. Think about that for a second.

I also want you to imagine a way to magnify risks. To lose exponentially more than you ever put up, more than you could ever hope to pay back. Think about that. The worst bet anyone could ever make, one that pays off so well for so long that everybody forgets it is a giant house of cards and when it collapses, it takes the whole economy down with it.

Both of those scenarios are real. Both are based on derivatives.

If you still wonder why I'm so on fire about, quote, "exotic financial instruments," it's because they're not that exotic at all. They have been around for centuries. They are bets, insurance really dressed up in jargon and tucked away in the dimly lit corners of Wall Street. Just because you and I don't get derivative solicitations in the mail like we get credit card pitches doesn't mean we shouldn't know they exist and why.

At their best, they're a testament to humankind's ingenuity, to our ability to endure adversity. At their worst we get AIG, Bear Stearns, the economic disaster of the last two years. For all these reasons, Congress and the White House are finally on the verge of writing regulations that actually fit the financial world of the 21st century. For all of these reasons, derivatives are at the heart of the regulatory overhaul. And for all of these reasons, it's essential that the overhaul be done right.

Derivatives can and shouldn't be outlawed any more than markets should themselves be outlawed and nobody is actually suggesting that, but they have to be out in the open with buyers and sellers knowing exactly what they are betting on or against, and right now that's not the case.

But now we've all seen the best and the worst of Wall Street. We're hoping for the best out of Washington.

That's it for me, over to Rick and "RICK'S LIST."