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Hiring Down, Jobless Rate Up; GOP Jumps on Weak Jobs Report; Mubarak to Learn His Fate; Just 69,000 Jobs Added in May; What's Bad and Better in Jobs Report; Mexico's New Drug Bosses; Wisconsin Gov. Faces Recall Vote
Aired June 01, 2012 - 12:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
SUZANNE MALVEAUX, CNN ANCHOR: I'm Suzanne Malveaux.
I want to get right to it. The jobs report out for May. It is disappointing, also raising concerns about the overall economy and the struggling recovery.
The Labor Department says that employers added just 69,000 jobs in May. It is a lot fewer than 150,000 jobs that economists were expecting. The unemployment rose by -- from 8.1 percent to 8.2 percent and on top of that, you've got the jobs numbers for March and April worse than expected.
Shaping up to be an ugly day on Wall Street as well.
I want to bring in Alison Kosik.
Give us an update on how the jobs report is actually affecting the markets today.
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Well, no surprise, Suzanne, after that anemic jobs report, stocks are getting hammered. As you can see, the Dow falling 207 points. Guess what? The Dow has erased all of its gains for the year.
And it's not just the Dow. We're also watching oil. Oil prices are tumbling not just on the expectation that demand here in the U.S. is going to slow down, but globally, too. There's weaker demand from China and Europe as their economies slow as well. So that is weighing on oil prices.
We're also watching the interest rate on the 10-year U.S. Treasury bond. That fell below 1.5 percent. That's an all-time low. What U.S. bonds are, they're considered a flight to safety. And at this point, you see investors leaving stocks and investors really want to put their money in what's seen as super safe guaranteed investments and that's U.S. bonds.
Even though you look at that investment, Suzanne, it's barely going to give a return right now. By the way, that lower interest rate also means the U.S. government can borrow money virtually for free right now -- Suzanne.
MALVEAUX: What does it mean in terms of the big picture when you look at the economy? We're looking at the small numbers, the minutia here. But play this out for us in the big picture.
KOSIK: You know what the big worry is? When we saw the job number kind of come down since January and February, people were saying, you know, it was because of the weather, there were other issues into these reports, but now, what you're seeing is this trend. You know, you mentioned that the months of March and the months of April, those job revisions were actually moved lower.
So, what you see is a trend forming here. You see that momentum that we had in job growth really slowing down. That's a huge worry. I mean, think about it. You know, if people don't have jobs, they're not going to spend money. That's not going to make the economy help to turn around go around.
Adding to the worry is that GDP report that we got yesterday, the second reading on economic growth here in the U.S., it showed a 1.9 percent rate. That's a tick down from 2.2 percent. That's another big worry. You see sort of we're taking these steps backward. That's certainly not the direction we want to go in -- Suzanne.
MALVEAUX: You're taking a look at the stock market. It looks like it is plunging. We're coming of a rough month of stocks.
What are the final numbers for May?
KOSIK: May certainly didn't look good and June 1, we are into June, not looking good either.
You look at May, the S&P 500, which most of our portfolios really track, that tumbled 6 percent in May. The NASDAQ fell 7.3 percent. The Dow was also down 6 percent for May. This is the worst performance for stocks since September.
And worries about Europe was the biggest reason that sent stocks lower in May. We've got more of that worry today. The manufacturing sector shrank in Germany and France and Italy and Spain. It means less demand for U.S. companies, too.
And that impacts heavy equipment-maker Caterpillar, for instance, a company that we know and we certainly know here in the U.S. Caterpillar sells a lot of machinery overseas, but you see its shares lost 14 percent in May. It's down again today. So, you're seeing these companies get hit hard as those worries in Europe escalate.
MALVEAUX: All right. Alison Kosik, thank you very much.
They say all politics is local, right, but what is going on in Wisconsin right now -- certainly has national implications as well. We saw former President Bill Clinton there. He is speaking about it. He is doing all he can essentially to get the Republican governor kicked out of office there.
I want to bring in Paul Steinhauser to talk a little bit about that, as well as what we're seeing in the jobs numbers.
Paul, first of all, you've got this recall election that has taken national prominence. You've got the former president there.
This is important because this really does set the stage for workers' rights, for unions, bargaining rights, as opposed to what the governor has done, and he is looking at this and he could potentially lose his job. Why are we seeing folks like President Bill Clinton come in and get involved in Wisconsin?
PAUL STEINHAUSER, CNN POLITICAL EDITOR: Yes, because both sides se this election almost as a precursor or a test case, an appetizer, barometer, whatever you want to call it, for the big deal, the main event, which would be the general election, the battle for the White House in November.
That's why you're seeing Bill Clinton today. I guess he would be about as big a surrogate as you can get on the Democratic side other than the current president, Barack Obama. That's why he is there today.
On the Republican side, Suzanne, you have seen a lot of big names as well, Nikki Haley, the governor of South Carolina, will be with her fellow Republican Governor Scott Walker today. You've seen Chris Christie, Bobby Jindal and some other big names on the Republican side campaigning for Walker.
Both sides, and especially the Republicans, are really flooding Wisconsin with a lot of money, spending a lot of money on ads on get out the vote efforts, because they see this as a national referendum almost in the battle for the White House -- Suzanne.
MALVEAUX: And, of course, the jobs numbers, the jobs report, a lot of folks are jumping on that. You've got the unemployment rate. So, it ticks up a little bit, 8.1 percent, 8.2 percent, it's not large, but it certainly has some real implications for President Obama and his campaign when folks are looking at, hey, are you making our lives better?
Already, Speaker Boehner jumped on this. I want to play a little bit of sounds.
(BEGIN VIDEO CLIP)
REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: It's pretty clear that the American people are still asking the question, where are the jobs? Another month of disappointing job gains, and it's clear that the policies that we've seen are not working.
(END VIDEO CLIP)
MALVEAUX: So, Paul, you have five more of these monthly job reports before people actually head to the polls and decide what is going to be the next president. Do we need to hear more specifics coming from both President Obama as well as Mitt Romney in terms of what they are going to do?
STEINHAUSER: Yes. I think we need to hear more specifics because right now all you'll hear something a lot of rhetoric and you heard that sound just now from the top Republican in the House. Mitt Romney, the Republican presumptive presidential nominee, is saying something very similar.
And, Suzanne, here is why it matters. As Mitt Romney runs for president, his main theme is I can do a better job creating jobs than President Barack Obama.
So, what do Americans think of all this? Well, listen, you know, I know, the economy and jobs remains the top issue on the minds of American voters, has been for a couple years, and still is by far over any other issue. And Americans seem to be divided between who can do a better job on jobs, President Obama or Mitt Romney, both nationally and in some crucial state polls.
So that is why these numbers are so crucial every month when they come out. It's the most important economic number in politics right now.
MALVEAUX: Right.
STEINHAUSER: And both sides, as you say, they do have some very different philosophies on how to stimulate jobs, the president and Mitt Romney. Romney, of course, is saying, let the private sector lead the way -- Suzanne.
MALVEAUX: Paul, I thought it was interesting -- I don't know if you had a chance to take a look at this, what happened at the White House yesterday. You had President Obama hosting the former President George W. Bush and First Lady Laura Bush at the White House, the unveiling of the portrait there.
A lot of graciousness amongst them all, but President Obama did get this point in. I want to play this.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The months before I took the oath of office were a chaotic time. We knew our economy was in trouble, our fellow Americans were in pain, but we wouldn't know until later just how breathtaking the financial crisis had been. And still over those 2 1/2 months in the midst of that crisis, President Bush, his cabinet, his staff, many of you who are here today, went out of your ways -- George, you went out of your way -- to make sure that the transition to a new administration was as seamless as possible.
(END VIDEO CLIP)
MALVEAUX: OK, Paul. So kind of a compliment in there, right? When you talk about the transition.
STEINHAUSER: Right.
MALVEAUX: But also making the point, reminding voters, look, this is what I inherited. How important is that, that he make that point over the next five months?
STEINHAUSER: He's been making it basically since he became president and, right, he has really stepped it up now that he's running for re-election and the campaign season has been heating up. No doubt about it. That's one of the themes here, that President Obama says he inherited a mess and that he's been trying to clean it up over the last couple years.
So, what do Americans think? Who do they blame? You know, Suzanne, it's interesting, when you look at most national polling, most Americans still blame the previous president, George W. Bush than President Obama for getting us in the mess. But Mitt Romney's agreement is regardless of how we got into it, he says he has better ways of getting out of it than President Obama.
You know, who's going to be the ultimate judge? The American people on November 6th.
MALVEAUX: Absolutely. All right. Paul, thank you very much. Good to see you.
Here is what we're working on for this hour.
(BEGIN VIDEO CLIP)
MALVEAUX (voice-over): On trial for his life. What's in store for Egypt's fallen dictator?
Then another wound for the White House on Wall Street. Why the unemployment rate is the most important number in politics.
And party in the U.K. We go behind the scenes before the kickoff to the queen's diamond jubilee.
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(END VIDEO CLIP)
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MALVEAUX: In just a few hours, we're going to know the fate of Hosni Mubarak, whether or not he is found guilty of corruption and ordering hundreds of people killed, and the possibility that he might actually die in prison.
Now, Hosni Mubarak, as you know, ruled Egypt for more than 30 years, took just 18 days last year for the Egyptian people to rise up, force Mubarak to step down, and set the stage for what Egyptians today are calling the trial of the century.
I want you to check out what Ben Wedeman reported out of Cairo.
(BEGIN VIDEO CLIP)
BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice- over): His appearance in court was a spectacle few Egyptians thought they would ever see. Within the space of six months, Mohammed Hosni Mubarak went from the pinnacle of power to the depths of humiliation in the defendant's cage. His humiliation broadcast live for the nation, indeed the world, to see.
He was charged with corruption, misappropriation of funds, and most seriously, issuing the orders in January of last year to kill demonstrators calling for the downfall of his regime.
(END VIDEO CLIP)
MALVEAUX: I want to bring in Michael Holmes from CNN International.
So, first of all, this guy, he's 84 years old. He's wheeled in in his trial on a gurney, a hospital bed here. Do we, first of all, expect that he's going to live much longer? And, secondly, could he be put to death?
MICHAEL HOLMES, CNN INTERNATIONAL ANCHOR & CORRESPONDENT: Well, he could. It's on the books in Egypt. I mean, the verdict could range from acquittal to the death penalty or something in between, of course.
And the jail sentence could vary, too, depending on what he's found guilty of, because you said, he's charged with a variety of things. But, yes, he's not well. He's got heart problems and there's other things wrong with him, too.
They have really been revealed. Some suspect he's had some form of cancer. The main problem with him is the heart.
MALVEAUX: Do we think they might have some mercy on him if they realize, OK, he's not going to live much longer? Maybe we're going to do a light sentence here? Could that actually impact the verdict and the sentence?
HOLMES: That wouldn't go down well on the street if that were to happen. No, a lot of people are saying that -- it's interesting, in a purely legal sense, the charge he ordered the live firing on protesters and the killing of hundreds of people, he and others, that one was pretty hard to prove. I mean, you can surmise he must have known and must have authorized it but proving it, a direct link between a body and him, is a different thing to do. A lot of it analysts say, maybe the prosecution didn't get that nailed down.
But he's also charged with corruption. Corruption charges carry up to 15 years in jail. A lot of people say, well, he might not be convicted of murders or the all killings, he might be convicted of the corruption.
MALVEAUX: He's got some friends in high places, also in the judicial branch. Is it possible his friends will look the other way, even if the streets riot and they erupt with protests, that they look the other way and he's acquitted? He gets away with it?
HOLMES: I don't think they would want to risk that. I think that would be -- no, I can't see that happening. I can't see that happening because if he is acquitted, and, you know, you can expect to see Tahrir Square full of people.
The authorities are already putting plans for tanks and hundreds of troops around Tahrir Square in case of an acquittal because that would be -- for the people, the revolutionaries, they would see that as the final knife in the back of their revolution. They already don't have a candidate in the election, and to have Hosni Mubarak freed and acquitted of what happened on the street during those 18 days, that would be a slap in the face to those protesters. It would be trouble.
MALVEAUX: And finally, give us an update on what's taking place. I mean, who is actually in charge? You have a runoff presidential election and it still needs to play out.
HOLMES: It does. And it's interesting, the timing of this, to have this verdict coming down two weeks before the runoff election. You've got Mohammed Morsi of the Muslim Brotherhood, the Islamist candidate running. He's against Ahmed Shafiq, who is a former prime minister of Mubarak, so seen as the old guard. Very polarizing choices.
And the moderates, the revolutionary candidate, didn't come about in the main election, the election a couple weeks ago because they had too many of them and they split the vote. They didn't get enough votes to get into this runoff.
Who is running the country at the moment? The military. The supreme council of the armed forces, or SCAF, and a lot of people are worried how much power they will give to the president when he is elected and will that amount of power depend on who gets elected, the old guard who the military like, or the Islamist, who the military doesn't like.
MALVEAUX: Arab Spring, I mean, really, just a year ago and it's still so uncertain how this is going to play out.
HOLMES: Yes.
MALVEAUX: Thank you so much, Michael.
HOLMES: Good to see you.
MALVEAUX: Well, they're getting ready for a huge party in London this weekend, all in the honor of her majesty the queen. We're going to get a behind the scenes look at the events kickoff.
And don't forget, you can watch CNN live on your computer while you're at work. Head to CNN.com/TV.
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MALVEAUX: In Britain this weekend, they're having a big party. The country is celebrating Queen Elizabeth's diamond jubilee. Yes. She's the second longest serving monarch. She's been on the throne 60 years. She was just 27 at her coronation.
Brooke Baldwin, she is joining us right outside Buckingham Palace there.
Wow, Brooke, it's great to see you. What a wonderful backdrop.
Well, it's funny. When President Bush visited the queen and she did the queen wave, we all did the queen wave with her because you can't help it. It's infective.
I mean, tell us --
BROOKE BALDWIN, CNN CORRESPONDENT: I know, I'm learning --
MALVEAUX: -- how are you preparing for this thing.
BALDWIN: I'm learning it's not this. I'm still not graceful. It's very much so like this. It's regal and it's graceful.
She is stoic and she's Queen Elizabeth. And that's right, you mentioned, this is the diamond jubilee. That means she's been on the throne for an entire 60 years, which is stunning. She got the news that her father died sadly back when she was in Kenya in February of 1952.
But in terms of preparations here, Suzanne, and I've got to tell you, I got of a flight yesterday and really hit the ground running here. Talking to people, it's a huge party. It's a party atmosphere.
I mean, people who live in London who are born and raised here are out wearing their Union Jacks and their Union Jack sunglasses. You walk along-- we were along Regent Street, sort of one of the main thoroughfares in London today, and it's like every single store, there is something Queen Elizabeth, something quintessentially British. It's truly spectacular.
So, there are two days, if I may. It's Sunday, which is the grand pageant on the Thames. A thousand boats will be at Tower Bridge, which is ultimately where these 1,000 boats pass by and the queen will be on the royal barge waving to everyone and we'll be live there on Sunday.
And then Tuesday, we'll be back here at Buckingham Palace, and this will be where the queen will be riding up along the mall in the state landau carriage basically saying hello to her people, and they're anticipating, Suzanne, I'm trying to wrap my head around this number, a million, maybe more people just waiting to crane their necks just to see the queen.
MALVEAUX: What's the most bizarre, interesting thing you have seen so far?
BALDWIN: Hmm. I learned what Pimms is today. Do you know what Pimms is?
MALVEAUX: No.
BALDWIN: OK. So, Pimms, I can't believe I'm admitting this live on CNN, is some sort of gin liqueur. It's this very British summer drink and they fixed it for me in like -- not quite like a pint glass but in a glass. And it's a gin liqueur with ginger ale or what they call lemonade here, like our 7 Up, and a little bit of mint. You have to have cumber, I had strawberry.
I got schooled on the Pimms today. It's quite good.
MALVEAUX: That's very nice. Don't drink too much of that, Brooke.
I want to talk about this poll because the Brits are -- you know, they are crazy about their royals. Americans love the queen, too. A latest CNN/ORC poll showing that the queen, she enjoys 82 percent approval ratings among Americans. It's up from a low of 47 percent. That was around the time of Princess Diana's death back in '97.
As for the other royals right now, brand new poll shows Prince Charles at 57 percent. His wife Camilla at 36 percent, and so, yes, a lot of interest around the royal family, and it seems like the queen just keeps gaining in popularity here. And you're part of the party.
So we're going to be following you, Brooke. We're going to follow you and Piers Morgan this weekend.
You can catch all of this, the celebration, right here on CNN. Live coverage beginning Sunday at 11:00 a.m. in the East, 8:00 a.m. in the West. Queen Elizabeth II diamond jubilee, royal celebration, Sunday, on CNN.
(COMMERCIAL BREAK)
MALVEAUX: Today's disappointing jobs report is raising some concerns about the overall economy. The Labor Department says that employers added 69,000 jobs in May. It is a lot fewer than the 150,000 jobs that economists were actually expecting. The unemployment rate rose from 8.1 percent to 8.2 percent, and we want to go behind the numbers here and get the full picture here.
Ali Velshi, he is joining us live. Ali, first of all, economists were predicting 150,000 jobs would be added. We're way off, right?
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Yes.
MALVEAUX: It's half that number. Why did they get it so wrong? Why the big disparity here?
VELSHI: You know, it happens sometimes. Sometimes, we're right on about what's going on and sometimes unusual things happen in the economy. And the unusual thing here is that there's been a slowdown that we've seen in many parts of the economy.
You know, you don't want to take one thing in isolation, just jobs. Jobs are the most important but you want to take a lot of other measures -- manufacturing and consumer confidence.
What we're in is a jumbled world. You know in a different life, Suzanne, I'd be talking about this from a business perspective and I'd be asking you from your days at the White House, what the administration is thinking about this. This is most problematic for them because they have been riding this wave of job growth and an economy that's going along.
We've now had a very rough month in the stock market. We've got job growth that's not there. And we've got all this stuff going on outside of Washington, i.e., China, India slowing down, Europe in a slow implosion, that's got nothing to do with Washington. But in this, as we approach an election cycle, this becomes, as you said in your tease, the most important number out there for politics.
MALVEAUX: So, let's talk about that because you really do have -- you've got more of these monthly job numbers that come out before people go to the polls, decide who is going to be the next president. You have Republicans saying, look, this is really important when we take a look at things like the debt and the deficit.
VELSHI: Yes.
MALVEAUX: Realistically, Ali, whether it's President Obama, whether it's Mitt Romney, is there really that much they can do beyond surface, beyond just picking at the edges to make a real impact when it comes to the economy?
VELSHI: Here is what creates jobs. It's very, very simple. People will tell you and sometimes it will be conservatives who will tell you, if you cut taxes, you create jobs or if you reduce regulations.
The truth is a company hires people when demand for its product increases. That's the long and short of it. You may not like regulations, you may not like taxes, but if there's a line out your door to buy your stuff, you hire more people.
Demand comes from confidence you are going to be employed in six months or a year. Now, you see that chart, that's the job creation over the last few months. What happens if the average person, even if they're employed, sees this and says if I think there's a chance I might lose my job and the stock market has been rough, maybe I'm not going to spend on something -- and that reduces demand.
The problem now again back into your court, Suzanne, is that Republicans who have been arguing for cuts in spending, this is a dangerous road because look what happens in Europe. You cut spending, you lose more jobs.
MALVEAUX: And I also want to bring up the point here because you think maybe it's a silver lining if you will. There's 640,000 folks who actually went back into the workforce, right? They decided, OK, we're encouraged enough, we'll look for jobs. And that's a good thing.
So are we beginning to see a little bit more confidence from folks who were sitting on the sidelines? I mean, is there somehow something beneath the surface that shows that things are getting better?
VELSHI: Well, that's the part that's interesting. That's why the unemployment rate actually went up, because more people -- it's counting a percentage of a larger group of people.
So it's hard to tell. I would say to you, Suzanne, there are times in the last few years when I have been able to say every economic indicator points downward or every economic indicator points upward.
We're now in this place where last week we had an economic indicator that said consumer sentiment is at the highest point since December of 2007. Then we had a new one that said it's at its lowest point in the last five month.
We had one that says housing prices were up 10 percent and another that said it's down. We're totally in this mixed up world where it's unclear what's going on.
In a consumer driven economy how you feel tends to be more than important what's actually going on out there so unclear. Some people are thinking it's a good job market, some are thinking it's bad and it's going to take a few months to shake down.
COSTELLO: Yes, how people feel in November is going to make a real big impact on who becomes the next president. Ali, thank you so much. Really appreciate it. Have a great weekend.
VELSHI: My pleasure.
COSTELLO: Raw numbers, they're saying one thing. Traders, they might be freaking out on Wall Street, but I will talk to an expert who says there might be some signs of hope when you take a look at those new numbers.
POPPY HARLOW, CNNMONEY.COM CORRESPONDENT: Good to see you. We're on the help desk today and we're talking about building your credit, very important.
Got two experts to help us do that, Ryan Mack, president of Optimum Capital Management and Stacy Francis, a financial adviser and president of Francis Financial.
All right, Ryan, we got this e-mail from Bree in Washington. Bree wrote in, I'm thinking getting a credit card to help build my credit card. Until now I have only used a debit card. How should I pick a card?
RYAN MACK, PRESIDENT, OPTIMUM CAPITAL MANAGEMETN: With her situation, 15 percent of your FICO store is length of your credit history and debit cards do nothing despite what celebrities want to have you think.
You want to go to websites like bank rate.com to help you select a car. Avoid pre-approved offers. Make sure you use your card responsibly. Make sure analyze all the fees and total cost of the card and understand exactly reading the fine print and re-reading the fine print.
HARLOW: Yes, absolutely. Probably asking friends and things what success or not that they've had with different cards. What do you think about a lot of these starter cards that are loaded with fees often times? How hidden are those? How careful do you have to be?
STACEY FRANCIS, FINANCIAL ADVISER: You have to be careful. I would ask you to bring out your magnifying glass because that's what it's going to take to see all the fees.
Really what it comes down to is if you pay your cards on time, you're not going to be subject to those fees. So just make sure that you are being fiscally responsible, that you are using the cards appropriately and paying them off.
HARLOW: look at the rewards you can get because credit cards are competing whether it's miles or cash back. Get the most if you're going to get a card. Thank you both. If you have a question, send us an e-mail anytime to cnnhelpdesk@cnn.com.
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MALVEAUX: A lot of hand wringing over the jobs report out today. The numbers, they were pretty disappointing. The employers added just 69,000 jobs and the unemployment rate actually ticked up to 8.2 percent.
Georgia Tech Economics Professor Danny Boston is joining us to crunch the numbers. Good to see you, as always.
THOMAS "DANNY" BOSTON, GEORGIA TECH DEPARTMENT OF ECONOMICS: Great to be here.
MALVEAUX: You say bad on the surface, but underneath there is some good news. Let's start with the bad news first. Give it to us.
BOSTON: The bad news is what we see. The unemployment rate ticked up a little bit from 8.1 percent to 8.2 percent, only 69,000 jobs created.
So that's less than half of what economists had predicted would be created, and then the other part of that is construction. When you look at construction, 28,000 jobs were lost in construction, and that's an industry where we really want to see some action taking place. So that's the bad numbers.
MALVEAUX: All right, what is underneath? Is there any good news from what we're seeing today?
BOSTON: Yes. Because think of it this way, this month, you know, it's bad on the surface and better underneath. Last month, it was sort of good on the surface because unemployment rate went down but bad underneath. Let me explain that. We had 642,000 people coming into the labor market over the last month. If you go back a month earlier, there were 340-some thousand people who left.
Now if you add those two up, you get a net increase of almost 1 million people having come into the labor market over a period of two months. And the unemployment rate only ticked up by 0.1 percent.
That means some significant jobs have been created and we know that because based on the household survey, there were some 422,000 more people employed. So something is happening in the labor market.
MALVEAUX: Why is that happening? What is happening? Why are people actually more encouraged to go look for work, seek jobs, and then get jobs because that's a very big number that you're talking about.
BOSTON: Right. And that number is consistent with what we see about consumer sentiment. That is that number is increased. It's consistent with what we see about retail spending. So there are some significant areas of strength in the economy.
I think what's not being accurately reflected is that jobs number. Remember that you get two places that these reports come from. One is from establishments. And that's where that jobs number -- that 69,000. The other is from the household survey. I think that jobs number is off, and it's been revised every month.
MALVEAUX: Do you think we're going to get a better number when it's potentially revised like next month or the following month?
BOSTON: I think we will get a better number, but who knows because it's been revised. Sometimes it goes up, it goes down. I just don't think it's consistent enough to reflect accurately what's going on in the economy. The household survey is much more consistent.
MALVEAUX: And what about the persistent unemployment you have in the black community, 14 percent compared to whites, which is at 7 percent, Latino community 11 percent unemployment to whites, 7 percent. Why is it disproportionately high in these communities still? That seems to be increasing, unemployment and those two groups.
BOSTON: It did. It increased among African-Americans from 13 percent to 13.6 percent and for Hispanics as well. Again, it's reflected in the labor market.
For all the problems that go on in the labor market, African- Americans and to a lesser extent Hispanics are always the last hire. That goes back to the history of this country and a lot of persistent problems in the labor market.
But nonetheless, what happens is as these individuals come back to the labor market, they're initially registered as unemployed and that's what drives that number up. That's what's happening.
Once all of the people that are unemployed come back in, right, jobs continue to grow then you will see that number go down some. MALVEAUX: Well, I like the silver lining approach, the half full as opposed to half empty approach. But we'll see if those numbers are revised.
That is good that people are more engaged and more optimistic to even go back into the workforce where they had given up on getting jobs in the first place.
BOSTON: Absolutely, and I think that's going to play itself out. There are some significant areas of strength and we continue to grow despite what's going on in Europe, the economy is continuing to grow.
It's slowing down, but we've gone through these cycles, but the trend line for the cycles is up, and so I think, you know, looking down the road, there's reason to have some optimism.
MALVEAUX: I'm going to take your optimism. Have a good weekend.
BOSTON: Thank you.
MALVEAUX: Forget the term kingpin. We will tell you about new queens. That is right, in Mexico's brutal drug war.
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MALVEAUX: We're talking about Mexico now, a fascinating change in the most violent and ruthless industry south of the border, the trade and trafficking, of course, of illegal drugs.
Since the Mexican government cracked down on the cartels a few years ago, about 50,000 people have been killed. We're talking about turf wars, assassinations, just plain street battles gradually wiping out top layers of these crime organizations.
Often what happens, it leaves the women who are connected to those groups, the widows, girlfriends, even the daughters, to essentially step into those leadership roles.
Rafael Romo is here, senior Latin affairs editor. This is a fascinating story here because you now have women who are the head of this drug trade. How is it impacting what is taking place?
RAFAEL ROMO, CNN SENIOR LATIN AFFAIRS EDITOR: Well, what's happening is that the war on drugs in Mexico and all the drug lords being killed and their lieutenants, that leaves a big vacuum, and who is going to step in?
Maybe the lower strata of the criminal element or the women who surround these men who are their wives, their daughters, people who are related to them, and they have the knowledge and the power to just step in and do what their husbands were doing, and that's what we see happening more and more.
Now, it's not like an all-out transformation. It's only estimated that 10 percent of the criminal organizes are run by women. But in any case, it's a very interesting and significant development. MALVEAUX: Is it changing anything when it comes to the drug trade, the drug war, the level of violence?
ROMO: According to a book written in Mexico recently, it's called (INAUDIBLE), "The Female Bosses of Narco," by a researcher in the state of Sinaloa, the point that he makes in the book is that women are much more intelligent, not as aggressive, not as an all-out, let's go out and kill everybody, but more targeted, more sophisticated, better when it comes to doing business and watching the bottom line.
MALVEAUX: Are there examples of women who are actually doing this?
ROMO: One woman specifically that comes to mind is Sandra Avila Beltran. She was arrested in September of 2007. And her nickname was "The Queen of the Pacific." Here she is on camera. She ran all of the operations for the Mexican drug cartel known as Sinaloa cartel, in all of the Mexican Pacific, helping coordinate a multi ton shipments of cocaine from Colombia to Mexico and eventually to the United States.
Now, the reason why she made headlines back in -- last year was because she was trying to get a Botox treatment in prison, and that's another reason why she --
MALVEAUX: That's a little different.
ROMO: Yes.
And then we also have the case of Angie Sanclemente. This is a very interesting case. I'm fascinated by this case because she was a former beauty queen. She won Miss Colombian Coffee in the year 2000 when she was only 21 years old. Very, very beautiful. She became a lingerie model in Mexico. And then, in 2010, she gets arrested in Argentina for allegedly being the leader of a ring of very beautiful women who transported cocaine from South America to Europe via Cancun, Mexico. And so now she is in prison.
MALVEAUX: Wow.
ROMO: But that gives you an idea -- this two women gives you an idea of exactly what's going on and the kind of transformation that we're seeing here.
MALVEAUX: Yes, you just don't imagine that. I mean you see the woman in lingerie. You don't imagine those are the drug -- the new drug lords that are operating --
ROMO: Well, they were distracting people at the customs office.
MALVEAUX: I'm sure they were.
ROMO: And so they were using that in their benefit.
MALVEAUX: All right, Rafael, we're going to follow up on this story, because I just find this all very fascinating. Thank you very much.
ROMO: Thank you. MALVEAUX: I really appreciate it.
Hold on to your hats. We're talking about super volcanoes, like this one at Yellowstone National Park, may be a lot more likely to erupt than you think.
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MALVEAUX: All right, imagine this. A volcanic eruption a thousand times bigger than this one at Mt. St. Helen's 32 years ago. It might sound like the stuff of science fiction, right, but super eruptions very real, extremely deadly, and maybe on a much shorter fuse than we even realize. Chad Myers bringing us the very latest.
Chad, tell us what a super volcano is and where do they live?
CHAD MYERS, AMS METEOROLOGIST: Yes, there's a little panic going around the web today about these super volcanoes and calderas and how quick they could erupt and kill us, because it could take like -- they could start and end in like 500 years. So if you're going to be 520 years old, you're going to -- you might even see one of these. Don't sweat it. Don't -- really don't sweat it. But it -- obviously it could happen.
What is a caldera? What is Yellowstone? What is a super volcano? If you look at Yellowstone on a map or if you've been there, you have no idea that you're actually standing on the surface of a volcano. An old volcano. A super volcano with magma well down below. Right now it's 10 kilometers deep, about six miles. If it ever gets up here, about three miles deep, you need to start to worry because all of a sudden all of this ash could fly into the air in a huge eruption and, like you said, so much bigger than Mt. St. Helen's.
Mt. St. Helen's here. The mount of ash. The biggest eruption we've ever seen was Mt. Toba. That much ash would have cover the entire world with some type of ash. And we believe from about 60,000 years ago, that this caused a small ice age of about maybe 10 years. Probably killed off millions of beings then and maybe brought the population of hominids of what we think maybe the prehistoric humans down to about 10,000 people. That's how many people that this could actually kill if it ever happens.
Where's the worst one that we know of? Yellowstone. And you don't even know it's there until you get there and look at it, but it is a big ring around where mountains are all around the side. And if you get down to the surface of the caldera, you don't see anything bubbling, like magma. But what do you see? You see water coming out of the ground. You ever heard of Old Faithful? That's part of it.
MALVEAUX: Wow. All right, good to know. Thank you, Chad. Appreciate it.
MYERS: You're welcome. All right.
MALVEAUX: We're celebrating a birthday today. Thirty-two years for CNN. CNN debuted on June 1, 1980, with founder Ted Turner kicking things off from Atlanta. Ever since then, we've had the privilege to bring you the biggest stories from around the world. And right through it all, our director, Roger Strauss. Roger actually predates CNN. He started working for the network two months before the very first big broadcast. And we wanted to show you, here's what Roger had to say about CNN's past, present, and future.
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ROGER STRAUSS, CNN DIRECTOR: Two months before CNN went on the air, it was just a -- it was a vacant building basically. There was no set. There was no wiring. Nothing worked. So they brought us in and we were veejays and we were making $3.25 an hour.
Ted Turner used to believe that the shopkeeper should live right above the store. So he actually lived above the network at CNN in our old building. And he would come down in his bathrobe in the mornings and pour some coffee and he would walk through sometimes at night with a nice looking blonde on each arm. And he was a character. And it was always fun to see him.
I remember once I was in this building and I was eating lunch one day and he just sat down with me and it's like, oh, Ted Turner is eating lunch with me. It's like, what do you talk about, you know? So we talked for about 10 minutes about various things. And it was like, wow, I just had lunch with Ted Turner.
The future of CNN is that we're going to be everywhere. We're going to be on your television set. We're going to be on your computer. We're going to be in your iPad. We're going to be in your iPod. We're going to be on your iPhone. We're going to be everywhere.
We are everywhere. But you're going to want us everywhere. And you're going to look for us everywhere. And that's where you're going to find us.
(END VIDEO CLIP)
MALVEAUX: And where do we find Roger? Hard at work always in the control room directing the show. Roger, one of the originals. Happy anniversary. You do a great job.
STRAUSS: Thank you. (INAUDIBLE).
MALVEAUX: And some heavy political hitters getting in the middle of an election recall battle in Wisconsin. We're going to tell you why former President Bill Clinton thinks that this is such an important fight.
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MALVEAUX: Former President Bill Clinton, he is on the campaign trail today in Milwaukee. Not for the presidential election, but Wisconsin's recall election for the state's governor. Now, he is campaigning for Milwaukee's mayor, who's going to face off against Governor Scott Walker on Tuesday. The campaign has taken on national important because of the battle over union rights, as well as collective bargaining. Now here's how Clinton referenced it earlier today.
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BILL CLINTON, FORMER U.S. PRESIDENT: If you go anywhere in America today, there -- believe it or not, there are a lot of places that are already back. And they all have one thing in common. They're dramatically different. But they all have one thing in common. They are involved in creative cooperation, not constant conflict.
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MALVEAUX: So why is this important? Our own Ted Rowlands, he's basically looking at the importance of this showdown.
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TED ROWLANDS, CNN ANCHOR: Scott Walker shouldn't be campaigning until 2014, but the now second-year governor of Wisconsin made so many people mad in his first few months in office, he's facing a recall.
ROWLANDS (on camera): Were you surprised at the fact that the recall did go through and what could you have done to prevent it?
GOV. SCOTT WALKER (R), WISCONSIN: Well, eventually I wasn't. If you would have asked me a year and a half ago, I totally would have been surprised because I just tried to fix thing.
What would I have done differently? Simple. I would have spent more time last January and early February making the case for our reform.
ROWLANDS (voice-over): Those reforms slashed the power of public employee unions, which set off a firestorm.
CROWD: Kill the bill! Kill the bill!
ROWLANDS: Thousands of protesters were angry that Walker had launched what they saw as a surprise attack against labor unions. Walker's new law, which he signed last year, also makes employee contributions to the unions optional. Walker's opponent in the recall, Milwaukee Mayor Tom Barrett, says Walker's grand plan from the start was to attack labor unions.
MAYOR TOM BARRETT (D), MILWAUKEE: I look back at 2011, and Governor Walker, these are his words, these are not my words, said he was going to drop the bomb. That was his first phrase.
ROWLANDS: Drop the bomb is from this phony phone call, what Walker thought he was talking to billionaire boner David Koch.
WALKER (voice-over): And I'd have all my cabinet over to the residence for dinner, talked about what we were going to do, how we were going to do it. We'd already kind of built plans up. It was kind of a last hurrah before we dropped the bomb.
BARRETT: The second phrase he said was, he was going to divide and conquer. ROWLANDS: Divide and conquer is from this documentary clip showing Walker talking to a supporter shortly after he was elected.
WALKER: Well, the first step is, we're going to deal with collective bargaining for all public employee unions as you divide and conquer.
BARRETT: He started this political civil war.
ROWLANDS (on camera): He says that you started a civil war in Wisconsin. Is that true?
WALKER: No. If anything, what we did is we said we're going to stand up and take on the special interests that had dominated things at both the state and local level, instead stand with the hard-working taxpayers of Wisconsin.
ROWLANDS (voice-over): Both candidates agree that Wisconsin voters are split.
BARRETT: You have situations where neighbors don't want to talk to neighbors. Where workers won't talk to fellow workers.
WALKER: This is not the Wisconsin way. I think we've had passionate debates before.
Back in 2000, 2004, we were the closest blue state in America, and we still got on.
ROWLANDS: With less than a week to go, Scott Walker has a slight lead in the polls. He says win or lose, he has no regrets.
WALKER: I'm doing everything in my power to win in terms of reaching out to voters, but in the end I have always said I have never been afraid to lose.
ROWLANDS: And even if he does lose, his new union law will remain in place. Red Rowlands, CNN, Milwaukee.
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