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Campbell Brown
Obama Announces Economic Team
Aired November 24, 2008 - 20:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAMPBELL BROWN, CNN ANCHOR: Hey, everybody.
An extraordinary move by president-elect Obama today, who has decided not to wait for his inauguration to take the reins -- the plan, to have an economic plan passed by Congress before Obama takes office, so that he can sign it on day one.
Operation take control right now launched in Washington today with president-elect Obama announcing the names of the lucky people chosen to come up with a cure for the bruised, battered and bleeding American economy.
Take a listen.
(BEGIN VIDEO CLIP)
SEN. BARACK OBAMA (D-IL), PRESIDENT-ELECT: Today, Vice President-elect Biden and I are pleased to announce the nomination of four individuals who meet these criteria to lead our economic team: Timothy Geithner as secretary of treasury; Lawrence Summers, as the director of our National Economic Council; Christina Romer, as chair of the Council of Economic Advisers; and Melody Barnes, as director of domestic -- the Domestic Policy Council.
(END VIDEO CLIP)
BROWN: So, a little more detail now on just who these people are.
Timothy Geithner, the nominee for secretary of the treasury, he is president of the Federal Reserve Bank of New York. They say he knows almost everything about how the global economy ticks, or fails to tick. And fun facts about him, he's a skateboarder with a salty vocabulary.
Geithner worked for years with Lawrence Summers, President Clinton's former treasury secretary. After Clinton, Summers was president of Harvard University. He is considered one of the country's preeminent economists.
Christina Romer, professor of economics at the University of California, is an expert on the Great Depression and the recovery that followed it. And Melody Barnes was a stop policy official at the Center For American Progress, a left-leaning Washington think tank. Her focus there was on middle-class families.
The news, the names seemed to go over well with the markets today. The Dow surged nearly 400 points. As for timing, Obama's economic team is going to work right away to try to get a plan completed and Congress to sign off on it before Obama is sworn in. Signing it into law would be his first order of business.
Yes, the deadlines unprecedented here. But then again, so is the urgency.
We are going to talk about all of this at transition headquarters and with our panel coming up in just a few seconds.
But, first tonight, cutting through the bull, as always.
It feels a little bit right now like we are all in some kind of suspended state. We're waiting for President Bush to leave office, waiting for Obama to take over, waiting for the automakers to come up with a bailout plan, waiting for the credit markets to unfreeze, waiting for the other shoe to drop in this terrifying economic environment, all of us right now trying to be patient, to let all these various actors either depart or take the stage, or to let all these various bailout plans do what they're supposed to do.
But while we wait, there are a lot of people out there falling through the cracks. I was really struck by one college student telling his story to NPR over the weekend. He owes the University of Arkansas $2,000. He has just a few weeks until the end of the semester to pay what he owes, or he has to drop out of school. He was counting on a bank loan, but with the credit freeze, he now can't get one. And he is hardly the only one.
It is topic du jour in dorm rooms right now as students pack up for Thanksgiving holidays, how many of them won't be coming back because they can't get loans to cover their tuition or their basic expenses. Paying off years of student loan debt might be a struggle at times, but not being able to get a student loan in the first place is a disaster.
We are all trying to be patient, but letting the education of our young people fall by the wayside right now is truly a disaster for all of us.
As we said at the outset, president-elect Obama's team of economic first-responders is now pretty much in place. They still have to figure where to send the ambulances and the fire trucks these emergency economists will be driving and what to have the financial EMTs do in the meantime. In other words, what is this plan?
And we're going to talk about that, along with many other things, with Ali Velshi and Ed Henry.
Let's start with Ed. He's in Chicago tonight covering the Obama transition for us.
And, Ed, president-elect Obama under a lot of pressure to show action on the economy. But what we are seeing with this team being rolled out in November is pretty unusual, isn't it? That's right, Campbell. Most of these appointments usually happen in December, not November. And oftentimes it's national security first. He is making a conscious decision. I can tell you, his top advisers tell me they wanted economic security first.
That's why you had the team rollout today. Tomorrow, there's going to be yet another event where he will take questions from reporters, talk up the economy. He wants to fill this sort of leadership power vacuum that is out there right now, as you mentioned. Also, he's working the phones. Today, the president-elect spoke to President Bush about Citigroup. He also was on the phone with Ben Bernanke, the Fed chairman, to get the latest update on this financial crisis.
So, he has got sort of a full-court press. But I can tell you that only goes so far. He is still not filling in a lot of the details. Obviously, he's not fully in power yet. But he's not telling us how he plans to create 2.5 million new jobs, as he said over the weekend. He's also not giving details on how much his economic stimulus plan will cost.
Some people say it will be up to $700 billion. He's not saying how he will pay for it either. He was originally going to pay in part by raising taxes on the wealthy. But today it was interesting. He left the door open to not raising taxes on the wealthy because of a concern that it would lead to even less economic growth, Campbell. So, there's a lot of questions left on the table.
BROWN: Ed, it's Tim Geithner and Larry Summers who are like the key people right now. They have got to get this plan through Congress. How is it going to work? What is their mission?
HENRY: Well, it's interesting. One source close to the transition I spoke to a little while ago said they're a little bit worried that there could be some dysfunction here. They're two very different personalities.
You mention Tim Geithner, sort of self-effacing, kind of the diplomat. He's going to be running Treasury. Larry Summers will be inside the White House running the National Economic Council. He's sort of a bull in the china shop, very abrasive. And so he is going to be on the inside.
And you remember when he was running Harvard University as a president, he made some comments that were offensive to women. And there was some concern in the transition team that if he went up for treasury secretary, he would have a very bruising confirmation battle. So instead he's going to on the inside as a White House staffer, doesn't have to have a confirmation battle, doesn't need then.
And then Geithner on the outside, he will be the guy who goes through the confirmation battle. He's more of a diplomat. He will be the public face of this economic plan, while Summers, the tough guy, will sort of try to muscle it through Congress behind the scenes. Some people say it will be dysfunctional. But key Obama aides say they think that having that team will actually be very strong -- Campbell.
BROWN: Ed Henry for us tonight from Chicago with transition details -- Ed, thanks very much for that.
We have got Ali Velshi with us, as always, our chief business correspondent.
And, Ali, let me just get your take on Ed's assessment. Is that essentially what we are going to see Geithner and Summers be doing as they try to move this thing through Congress?
ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: I think Geithner's problem might be what you said. You said he had a salty vocabulary. I don't know what that means. Nobody says that.
(LAUGHTER)
VELSHI: Look, this is the issue.
The issue is I liken them to my Yankees. Best team around, they have got the best payroll. Why can't they close the deal? Why have they not been able to close the deal? You want to stretch the baseball analogy, these folks are not going to start the season. They have got to win the World Series right off the top. How do they play together? What is the strategy they're going to use to win?
They don't have much time. They have got to get into this thing immediately and solve a problem. They don't have the luxury of sitting around and ruminating and consulting on it. That's the issue that they have got right now. It does seem like it's an all-star team. It does seem like he's got the best of both worlds because both of these men were considered for treasury secretary and now he has got them both working on the same team.
BROWN: Right. Markets responded favorably today, yesterday, too. We have had two solid days now. Is this just the market sort of responding to somebody doing something out there?
VELSHI: Part of it is that. Part of it is this deal for Citigroup, $20 billion to bail out Citigroup.
BROWN: Right.
VELSHI: The reason that is interesting, while you may or may not agree with Citigroup should have been bailed out and why it didn't work the first time when they got $25 billion, what is interesting here is the model that was developed with the Fed, with the Treasury and with Citi's board, a way to use this federal money, the $700 billion, in part to help Citigroup, but it has got strings attached.
They have got executive compensation strings attached. They can't use this money to distribute it to shareholders. They have got to actually help mortgage holders who are in trouble. So, I think there is some satisfaction that there is a deal to bail out a bank and it actually might trickle down to help the rest of us.
BROWN: But some people said not enough strings, no management changes required there.
VELSHI: Sure. There's still more to come on this. There's a lot that has to be fixed. But what Barney Frank said last week with the automakers is that we learned from that $700 billion bailout.
Some banks got money and did things that they weren't supposed to with it. So, now it's a little more directed. Remember, this is still the free market. So, companies have to have some freedom to be able to change how they deploy the money. Citigroup didn't deploy it well in the first place. So, this is the struggle that we have got.
Do we go into an entirely controlled economy because we want to dictate how that money goes? That might be the solution. But it's going to be a bitter pill for people to swallow. That is the decision these guys have to make. Do they stimulate the free market or do they start directing it?
BROWN: We're expecting a pretty feisty debate that you are going to be part of on this subject coming up in just a few minutes. Ali, thanks very much.
VELSHI: It might get salty.
BROWN: Salty. Come on. That's a good word.
VELSHI: Salty vocabulary.
BROWN: I will let you use it.
We're going to talk more about all this in a moment, as I said a second ago, but first an insider's view on Obama's strategy. We're going to talk to Bill Daley. He's on Obama's economic transition team, an adviser. He's also of course former commerce secretary under Bill Clinton.
And then a little bit later, why are campaign commercials for Sarah Palin still on the air in Alaska? Even the last frontier must have heard by now the election is over.
Plus, our welcome to the White House with some notes, this time from the Clinton administration. We will explain.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
OBAMA: And I want to repeat: This will not be easy. There are no shortcuts or quick fixes to this crisis, which has been many years in the making, and the economy is likely to get worse before it gets better. Full recovery will not happen immediately.
And to make the investments we need, we'll have to scour our federal budget, line by line, and make meaningful cuts and sacrifices, as well.
(END VIDEO CLIP) BROWN: Well, not exactly what we want to hear, likely to get worse before it gets better. So, exactly what is president-elect Obama going to do to try to get us out of this mess?
Earlier today, we talked to William Daley, Obama economic transition adviser and former commerce secretary under President Clinton.
(BEGIN VIDEOTAPE)
BROWN: Secretary Daley, welcome to you.
WILLIAM DALEY, FORMER U.S. COMMERCE SECRETARY: Thank you, Campbell.
BROWN: I don't have to tell you, president-elect Obama is kind of walking a fine line right now. He says the goal, as he laid it out over the weekend, was to create or is to create 2.5 million jobs over the next two years. That's nearly double than what he promised in the campaign. How does that happen? Where are these jobs going to come from?
DALEY: Well, as he said, it's to create or save. So, it is an aggressive plan, no doubt about it. But I think you will see a substantial plan put together.
What that number is, the components, as he said in his radio remarks, it has to be a combination of rebuilding our infrastructure, making investments into new technologies, so that we are getting a long-term benefit, not just a short-term benefit, from a recovery plan.
BROWN: You have heard a lot of people compare it to sort of an FDR-style New Deal here, a giant public works program. Is that a fair comparison?
DALEY: I don't think it is going to be -- I don't think that is a fair comparison. No doubt about it, we have infrastructure needs that important as investments. So, that will be a component to it. It will not be all of the package, obviously.
The president-elect has also stated a major part of his plan next year must be middle-class tax relief. That is an important piece. He has stated that repeatedly over the last two years of this campaign. And he -- and he plans to deliver on that next year.
BROWN: Let me ask you, though. You're invariably going to get criticism almost no matter what you do. A new administration does. The president-elect working on a new stimulus package, and we're hearing numbers upwards of $500 billion.
Some Republicans on Capitol Hill are already speaking out against the ideas being floated. Senator Jim DeMint of South Carolina put out a statement today saying -- quote -- "We are trillions in debt, and Obama's massive new spending program threatens to send our nation over a fiscal cliff, leading to even higher taxes and fewer jobs." Is pumping huge amounts of taxpayer money into the system really the best way of solving this crisis?
DALEY: I think people ought to wait to see the plan before they make a judgment to be against the plan. There is no question the government is the only ones left to do something in a massive way.
One can comment on it. Obviously, the senator will have a chance to vote on something. But if the government is not there to try to change the economic crisis we're in to help the American people, who will do that? The American people expect their government to help them.
This will be an economic plan not about just creating jobs for jobs' sake, but to try to move our economy. That's what the president-elect is committed to doing.
BROWN: You mentioned tax cuts for the middle class a moment ago. During the campaign, Obama said he was going to repeal the Bush tax cuts on the wealthy.
And, at the time, Joe Biden said that wealthy Americans should consider it part of their patriotic duty to chip in during these hard times. Today though, president-elect Obama said -- said he hadn't decided whether to follow through with that plan, that it might actually get tabled, at least for a while. What has happened? What is going on?
DALEY: Well, you look at the terrible deterioration of our economy, and it takes all things that were talked about a month or two or five months or 20 months ago.
BROWN: Or a few weeks ago. He was still saying this just a few weeks ago.
(CROSSTALK)
DALEY: Right, or a few weeks ago. But you have seen a tremendous deterioration in the last week in our economy.
We have lost 1.2 million jobs in the last year. So, you have seen a dramatic change. The president-elect is committed, though, to middle-class tax relief, a very broad one. But he also believes very strongly, as he has stated, that those of us who have done quite well in the economy over the last number of years have an obligation to step up and -- and give a little more, so that there can be a broadening of the relief that needs to be done for the American people.
BROWN: Secretary Daley, appreciate your time tonight. Thank you.
DALEY: Good, Campbell. Take care.
(END VIDEOTAPE) BROWN: All right. President-elect Obama, you convinced voters you were the man to get our economy back on track. Now you have this impressive team, the entire world rooting for you.
Coming up, will it work? We are going to ask some of the smartest minds around what this plan, this economic plan, should look like.
And then, later, just how many trillions -- with a T. -- will be on the hook for after all the bailouts are done? We are going to put that to our NO BULL test tonight.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
OBAMA: With our economy in distress, we cannot hesitate and we cannot delay. Our families can't afford to keep on waiting and hoping for a solution. They can't afford to watch another month of unpaid bills pile up, another semester of tuition slip out of reach, another month where, instead of saving for retirement, they're dipping into their savings just to get by.
(END VIDEO CLIP)
BROWN: Well you can't make the situation sound any more urgent. And Barack Obama is responding with swift, unprecedented action, in many ways. He wants a rescue package on his desk ready to be signed the very day he sits down in the Oval Office. It's big. It's bold. He's got a little more than a month to pull it off. Can he do it?
With me tonight to talk about it, our own roster of econ all- stars, Jeffrey Sachs, director of the Earth Institute at Columbia University. And his latest book is "Commonwealth Economics for a Crowded Planet." Andy Serwer is managing editor of "Fortune" magazine. The new issue looks at General Motors and the death of an American dream. Chrystia Freeland, U.S. managing editor for "The Financial Times" newspaper, and back again, as always, chief business correspondent Ali Velshi, because it's not a panel without him.
(LAUGHTER)
BROWN: Welcome, everybody.
Andy, I want to go back to what Ali said to me a few minutes ago before the break, describing this economic team generally. They're his Yankees. They're his all-stars. Do you agree with that? Should Americans be sleeping a little easier now that these guys are in place?
ANDY SERWER, MANAGING EDITOR, "FORTUNE": Well, I think they should be.
And you can see how the stock market responded over the past two sessions, which is up tremendously. This is going to be the challenge of a lifetime for Tim Geithner. He's an extremely intelligent guy, very measured, smart. Larry Summers, of course, got the sort of number-two job. I think that the president gets his brain and doesn't have to run the risk of him putting his foot in his mouth.
CHRYSTIA FREELAND, "THE FINANCIAL TIMES": And I think the other thing to bear in mind about the Larry-Tim combination is they have worked together for a long time. And they have a really good close working relationship. Larry to some extent was Tim's mentor in the Treasury.
(CROSSTALK)
BROWN: So, they can hit the ground running in a way that is crucial probably right now.
Jeff, we have heard this pledge, 2.5 million jobs in the next two years, through rebuilding, crumbling infrastructure, a power grid, roads, bridges, schools. He said he appointed all these people because they're innovative thinkers. But it sounds like a massive public works program out of the 1930s. Is that what we are talking about here?
JEFFREY SACHS, DIRECTOR, COLUMBIA UNIVERSITY EARTH INSTITUTE: Well, there is going to be a lot of public spending. That is for sure. And there is going to be a lot of job loss. So, it's not going to be a net increase. They're going to try to compensate for what is a very deep recession under way.
Whether they can really do 2.5 million jobs directly through public spending, I doubt it. And I doubt that that is really what they want to do. They want to boost the economy again. It is going be through transfers to state and local governments, some very specific targeted programs and they will try to put a floor under what is a very steep recession right now.
BROWN: A good idea?
SACHS: Well, it's the only idea right now...
BROWN: Right.
SACHS: ... which is that, with consumer spending plummeting, with the banks a mess, with the industry teetering on the edge of disaster, there has to be some fiscal stimulus. And then, during the year, we hope, through further measures in the financial sector, to unlock this frozen financial system right now.
So, the idea is really to get through a very bad year and start to see a recovery towards the end of 2009 and into 2010.
BROWN: And at least in the initial phase do whatever it takes?
FREELAND: Absolutely.
And I think president-elect Obama was quite right when he said there is an unusual consensus right now among economists on the left and on the right and also internationally. This is something we saw Britain do today. The Chinese have done it. So, I think there is a really global view that government has to step in and stimulate the economy, because consumers aren't spending and businesses aren't spending.
BROWN: And, Ali, Obama has talked about these so-called green jobs.
VELSHI: Right.
BROWN: But, realistically, can you develop enough of these jobs to offset what is going to be this huge loss, probably permanent loss in manufacturing jobs?
VELSHI: Well, you can't build a fake economy. If there is work to be done and you can provide that work. -- Barack Obama has talked about a green economy and alternative energy.
So, if you combine work that does need to be done, like our electrical grid, which does need to be fixed, and we have roads and bridges, with incentives for business to create jobs for this new economy, you can actually do something with this.
But, fundamentally, everybody who has lost a manufacturing job in this country in the last four years has this much chance of getting it back. It is not coming back. So you can perhaps dull some of this pain for a few years with some federal investment. But in the end, we are going into a different economy. And this team is going to have to come up with a solution for that as well.
BROWN: Andy.
SERWER: And we talked about running up a deficit to do this. But you really don't have any choice. We have got to get to the other side. In other words, if the ship is sinking, you have got to patch the ship up before you get to 2010, 2011, and then worry about the deficit later.
BROWN: Does everybody agree with that? I mean, that was my next question, is -- because he is also talking about cutting taxes, middle-class tax cuts. And he's saying he is going to put off on what was a big campaign promise to repeal the Bush tax cuts on the wealthy.
SERWER: Yes, I don't think -- there is no way he is going to be able to do anything on taxes, except raise them in a couple years. That's my feeling on that.
SACHS: I'm not so sure.
BROWN: Why? Explain.
FREELAND: You think they should increase taxes?
SACHS: I think -- I personally would have advocated going through with the increases on the upper-income households.
You can't throw out every rule as if there is no tomorrow. What you need is a framework where you have a deficit now that increases as stimulus, but that shows a clear flight path to -- back to fiscal responsibility.
And, so, everybody does agree the deficit should rise. But to say throw out everything is a mistake. They need to show a multiyear plan, where the deficit comes back down. What I worry about is, since there is so much allergy in this country to any kind of tax increase, even for the rich, that, you postpone it, you lose it. And then we really don't have a fiscal base and a clear plan.
Well, if they can do it so fine-tuned, postponed this year and next year, but, politically, you postpone it, you may lose it.
(CROSSTALK)
BROWN: Quickly, because I...
(CROSSTALK)
FREELAND: Quickly, there is a sunset clause on the Bush tax cuts.
So, actually, the economics and the politics could really dovetail for Obama on this specific point.
SACHS: Yes, Chrystia, it could. But it is also an election year. It's going to be recession. It's going to be very hard. You put off something like that, you just wonder what you really are going to do. I think it is a mistake, actually.
(CROSSTALK)
SACHS: But, anyway, it's their choice.
(CROSSTALK)
BROWN: Stand by. More, more, more to talk about. We want to talk about the Citi deal and many other things. When we come back, we are going to ask perhaps the spookiest economic question of all: What are these ginormous rescue packages ultimately going to cost us? Or -- we will find out.
And still ahead: the latest election news from Alaska. We know that the election is over. Sarah Palin's supporters, though, apparently don't They are still running commercials for her. We're going to explain when we come back.
(COMMERCIAL BREAK)
BROWN: Lots of big economic numbers between thrown around these days: 2.5 million jobs, $700 billion for banks and other financial institutions. But whatever happened to the promises that the bailout billions would be used to buy up bad mortgage? Is this a plan that is working for Main Street America? And what is the next big bucks bailout on the horizon?
Our Tom Foreman took a look at all of it and put it to our NO BULL test. Take a look.
(BEGIN VIDEOTAPE)
TOM FOREMAN, CNN CORRESPONDENT (voice-over): Campbell, when the $700 billion Troubled Asset Relief Program, or TARP, was launched last month, it came under fire because it was sold as one thing, but quickly became another.
(voice-over): Gone was the promise to buy up bad mortgages. Instead, the Treasury Department had a new plan, pump money into lending institutions holding those bad loans.
Nine big-name lenders were first in line, including Bank of America for $15 billion, Citigroup $25 billion, Goldman Sachs $10 billion. On it goes. And officials have defended the strategy.
HENRY PAULSON, U.S. TREASURY SECRETARY: My focus is really on the financial system, stability, getting credit flowing again, because that's going to be the key.
FOREMAN: So far, $310 billion has been committed this way, including that latest money for AIG and Citigroup. Hundreds of banks are now involved.
And stability is improving. Banks are now charging each other less to borrow money. Some stronger banks are buying up weaker ones. Officials say, in coming months, more consumers and small businesses should find loans easier to come by.
But many economic analysts argue that the big banks are not being pushed nearly enough to help consumers sooner, there's still not enough oversight. And until those bad mortgages are dealt with, private investors will remain wary. At Moody's, Mark Zandi.
MARK ZANDI, MOODY'S ECONOMY: Bottom line, we got a lot of bad loans and bad securities and we don't know what they're worth. Until we do, no one is going to provide capital to the banking system and without that capital the banking system isn't going to function properly and neither is the economy.
(END VIDEOTAPE)
FOREMAN: Nevertheless, the Treasury Department is now talking about helping other types of lenders, those that deal in student loans, auto loans, credit card debt. If that is to happen however, Congress will have to re-approve spending the second half of the $700 billion. And that could be a hard sell if consumers go through the holidays with no real sense that this bailout is already working for them -- Campbell.
CAMPBELL BROWN, CNN ANCHOR: Thanks, Tom. Tom Foreman for us.
So are we turning into a bailout nation? And with corporations battling for multibillion dollar rescues, has Washington forgotten the little guy in all this?
Back to our panel now, Jeffrey Sachs, Andy Serwer, Chrystia Freeland and Ali Velshi.
And Andy, just talk us through the Citibank bailout for a quick second, because this is very controversial.
ANDY SERWER, FORTUNE MAGAZINE: Yes.
BROWN: And I mean, what does it mean to people who have, you know, that the average does (ph) kind of what I want to focus on here, the guy who's got a student loan with Citibank and how does it affect them?
SERWER: Well, presumably it makes their business with Citibank, the average person's business more safe. I mean that's what the government is really trying to do. They're putting, their guaranteeing hundreds of billions of dollars. They're putting tens of billions of dollars into the bank. And it doesn't look like they're getting a whole lot back.
I mean, that's another point that we should bring up. What sort of return do the people, the taxpayers get here? It doesn't look like a lot to me.
BROWN: Do you think there are going to be more banks lined up? Is this the end of it or hardly?
CHRYSTIA FREELAND, "FINANCIAL NEWS": Well I think there really could be. And the key part of the Citi bailout was not so much the $20 billion capital injection. It was this government guarantee for the $306 billion worth of toxic debt. That was really a return to the original part of the Paulson plan that Tom was talking about. It's very possible --
SERWER: There's kind of a free ride for the bank, don't you think?
FREELAND: Sure. I think the bank got that insurance at a really low price, and that is part of the reason why I think I wouldn't be surprised to see other banks saying, you know what, this was insurance on really good terms for Citi. It puts us in an uncompetitive position. We're going to need a similar guarantee.
SERWER: So there's more money for the banks and less money.
JEFFREY SACHS, EARTH INSTITUTE, COLUMBIA UNIV: Before that happens, we actually ought to understand what was done because the idea of helping the banks is a good one so that they don't crash. But the idea that the taxpayer gets some equity stake for the help that's given is a very important principle.
Just handing billions of dollars over to the shareholders is not such a great idea. And it looks like they put this guarantee over more than $300 billion of assets with relatively little in return for the taxpayers. If that's the case, they got to clean up their act because this is not the idea of just putting cash straight to shareholders. This is the idea of systemically protecting the financial system but making sure that the taxpayer gets a due amount for what the taxpayer is putting in, in this case, a guarantee on more than $300 billion of assets.
BROWN: But has that happened in any of these cases?
ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: It's an irony is that in many cases, the taxpayer has been the victim of this credit crisis and yet it's going to be taxpayer money that's actually going back around in some cases to support the very banks that have foreclosed on them. It's a sad irony of the system.
The problem is so many people have said, well, why don't I just get? Why can't you just bail me out? Why divide it up amongst all Americans? Because all Americans will get a few thousand bucks which I don't need but somebody needs ten times as much as the system. We have to divide that.
SERWER: That's what Paulson says, you know, that he gets to amplify and magnify through the banking system there's not enough money to go around. But I promise you that that's going to change because of optics, because it's just going to look like the right thing to do.
FREELAND: But it's not just about the optics. Last week, Citi really was on the edge.
SERWER: Absolutely.
(CROSSTALK)
FREELAND: And share price fell below $3. And the government --
SERWER: That's true, but I mean they're going to have to give money directly to the people and so the people want money. That's what's going to happen.
FREELAND: I agree with Jeff that the question is on what terms this rescue happens but that the government had to act.
SERWER: We will see.
FREELAND: It absolutely did.
BROWN: Almost out of time. Ten seconds.
SACHS: Rescue, yes. Make sure that it's done properly.
BROWN: Well going forward, we'll see what happens. Hasn't quite been done properly yet. Anyway, to Jeff, to Andy, Chrystia and Ali, of course, as always, thanks, guys. Appreciate it.
This thanksgiving, some people are thankful for Sarah Palin. We're going to tell you why coming up in tonight's PDB.
And a little bit later, Sasha and Malia Obama, meet your new best friend. And no, it's not the puppy your dad promised you. We're talking about the Secret Service. We'll get a glimpse of what it is like growing up in the White House. (COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
AMANPREET LAL, 6TH GRADE: Dear President-elect Barack Obama, congratulations on your new victory which is accomplishing the success of becoming our next president.
I am Amanpreet Lal from Johnnie L. Cochran Jr. Middle School here in Los Angeles, California. Hopefully when you first walk into and onto the president's chair, a big change will come upon America. I am very glad to have such a president who also believes the change for dreadful wars, high gas prices, the economy that's going down the toilet right now, and our country. We in the country are now pleased that our community will finally have the peace that everyone deserves having. Sincerely, Amanpreet Lal.
(END VIDEO CLIP)
BROWN: Children all over the country writing letters to the president-elect. And we really love seeing them and sharing them with you. To share your child's letter with us, just look for the iReport link on our Web site, CNN.com/Campbellbrown.
And it is time now for the PDB. As always, we've got CNN contributor and "Washington Post" national political correspondent Dana Milbank here with us right now to go through it all.
Dana, welcome to you.
DANA MILBANK, CNN CONTRIBUTOR: Thank you.
BROWN: Topping our PDB, we now know who will replace Joe Biden in the Senate when he finally resigns to serve as vice president of the United States. Tell us.
MILBANK: Well, we do. It will be his son, but that's eventually. And you got to be careful. You can't just go right out and do it because that's known as the for (ph) Murkowski. This was sort of the previous high watermark for nepotism that the senator from Alaska resigns, becomes governor and then appoints his daughter to his seat. So, they're going to be a little more careful about it, the Bidens. The governor in Delaware has appointed this fellow named Ted Kaufmann, 69-year-old former staffer to Biden.
And by an extraordinary coincidence, he only wants to serve in the Senate for two years at which point, Beau Biden, 39 years old, will be back from his duty in Iraq, will be able to run and win the United States Senate seat on his own merits, nudge, nudge, wink, wink, say no more.
BROWN: Oh, come on, you're so cynic. You've already plotted it out. Maybe they're not even thinking along those lines, Dana.
MILBANK: You wait and see.
BROWN: All right. A story that is kind of surprising here. But there's a thank you ad out for Sarah Palin.
MILBANK: Yes, there is and it's being put out by a group called Our Country Deserves Better political action committee. And whatever you think about Palin, our country does deserve better commercials than this.
It's real cheesy. It's a real turkey with a thanksgiving theme. It's got moose act (ph) going and it's got references to the moose chili.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Governor Sarah Palin, as Americans sit down to their thanksgiving dinners of turkey or moose, a grateful nation wishes to say --
UNIDENTIFIED FEMALE: Thank you, Governor Palin.
UNIDENTIFIED MALE: Thank you.
UNIDENTIFIED MALE: Thank you.
UNIDENTIFIED FEMALE: Thank you, Governor Palin.
UNIDENTIFIED MALE: We thank you for fighting for everyday working families.
UNIDENTIFIED MALE: You've given us hope. And we just want to say --
ALL: Thank you, Governor Palin.
UNIDENTIFIED FEMALE: What was those ingredients again for the moose chili?
ANNOUNCER: Our country deserves better. PAC is responsible for the content of this ad.
(END VIDEO CLIP)
BROWN: You really thought that was cheesy? I mean, Dana.
MILBANK: Well, it's been a big week already for Palin turkey videos. But I think we should warn our viewers tonight, they're threatening to go national with this one.
BROWN: OK. Fair warning.
Finally tonight, as President Bush gets ready to leave office, he's doing a lot of things for the very last time.
MILBANK: Yes. He's meeting with the Israeli prime minister tonight for the last time. Just got back from his last foreign trip where as usual on these APEC conferences he puts on the local garb of whatever the traditional garb of that country is. And, you know, I used to wonder why the president would put himself through all of this. But now as he's nearing retirement, you can sort of understand given where his popularity is now, he's going to be on that ranch down there in Texas and he's probably going to be in need of some good disguises. And fortunately, he has many from these conferences in his wardrobe now. There is the 2001 blue Chinese silk jacket.
BROWN: I remember that one. That was my favorite.
MILBANK: Yes. Very nice. The 2003 Thai silk shirts. The 2005, Korean Durumagi silk robe. The 2006, Vietnamese Ao Dai.
But I think this may be a bit conspicuous down there on the ranch in Texas. So perhaps he would be better off going with the 2002 white Mexican linen, the 2004 red Chilean poncho, the 2007 Australian Driza- bone (ph) waterproof jacket.
BROWN: Ah.
MILBANK: And, of course, the best of all, the 2008 traditional Peruvian poncho. I definitely think the poncho is the way to go, Campbell.
BROWN: Yes, I'm all for it. Oh, yes. Now it seems to me -- did you -- you wear that normally just around the apartment? Or --
MILBANK: Everybody in the CNN Washington bureau does.
BROWN: Oh, I didn't know.
MILBANK: Yes.
BROWN: I've got to get down there more often. All right. Dana Milbank for us tonight.
Dana, Happy Turkey day to you.
MILBANK: You too.
BROWN: All right. We'll see you next time.
Sometimes, you know, we have trouble picking our daily "Bull-s- Eye." Not today. It is about all of these people, an estimated 40,000 of them, and what drew them to a Colorado farm. A fascinating story.
Also, sleepovers, playgrounds, birthday parties -- all in a child's life with the Secret Service. What can the Obama girls expect after they move to the White House? We'll ask a former insider who helped Chelsea Clinton survive it.
(COMMERCIAL BREAK)
BROWN: Lots of other news out there, and Joe Johns is here tonight with "The Briefing." Hey, Joe.
JOE JOHNS, CNN SENIOR CORRESPONDENT: Hey, Campbell.
JOHNS: A federal jury is now deliberating the unusual and shocking case of a woman whose Internet hoax led to a teenager's death. Lori Drew created a fictitious teenage boy whose insults drove 13-year-old Megan Meier to suicide in 2006. Drew is accused of conspiracy and accessing computers without authorization.
Sources tell CNN that Osama bin Laden's former driver is being moved out of Guantanamo Bay. Salim Hamdan was convicted of war crimes earlier this year but cleared of the most serious charges. He'll be sent home to Yemen to finish the final weeks of his sentence.
A series of bombings in Baghdad today killed at least 19 people. Officials say one of the bombs was worn by a mentally disabled woman and set off by remote control. Iraqi lawmakers are preparing to vote on a security pact that would let American forces stay for up to three more years.
And watch out, "Buck Rogers," a guy wearing a jetpack and no parachute? Flew across Colorado's Royal Gorge today. The gorge is 1,500 feet wide and 1,100 feet deep. It took him 21 seconds to cross it. And good there wasn't any wind sheer.
BROWN: Crazy.
JOHNS: Yes.
BROWN: Joe Johns for us tonight. Joe, thanks.
Still ahead, with all the bad economic news out there, what happened on this farm? It hits our "NO BIAS, NO BULL" "Bull's-Eye" tonight. One of the stories everybody is talking about.
(COMMERCIAL BREAK)
LARRY KING, HOST, "LARRY KING LIVE": Good evening, I'm Larry King. The all-stars are here. Bob Woodward is among our guests tonight and David Gergen, and Carly Fiorina and Ben Stein, Robert Reich and Katrina vanden Heuvel, all join me. They're going to have a lot to say on this very critical moment in world history.
It's "LARRY KING LIVE." It's at the top of the hour, and Campbell Brown will return right after this.
(COMMERCIAL BREAK)
BROWN: Now it's time for "Welcome to the White House," our nightly roundup of all things Obama. And for that, we have our own one-woman transition team, Erica Hill.
What have you got tonight?
ERICA HILL, CNN CORRESPONDENT: It's a good beat to be on, let me tell you. Campbell, so much of our Obama coverage, Obama watch coverage is focused on the future for starters because people want to know everything about these little girls, like how 10-year-old Malia and 7-year-old Sasha will deal with play dates and the Secret Service.
Well, chances are, they're going to start out with a background check of the girls' friends. Imagine that for a 7-year-old, probably their parents too. And then a pass through a magnetometer before those kids can enter the White House. That from Diane Dimond over at the "Huffington Post."
Now if a sleepover is on the calendar, you can bet the Secret Service is going along too. Wherever the girls go, those agents will be there, even at school, of course. And should the first daughters misbehave, well, don't expect the agents to immediately tattle. They say they try to use their common sense there.
Meantime, it's just 57 days to go until the inauguration. We are leaving no stone unturned in our search for everything Obama. Exhibit A, the Obama scope to help you search out the president-elect.
If you're going to the inaugural parade, you're afraid you won't be able to see above the crowds, well, here you have it, a 26-inch long periscope, yours on eBay for $20. The Obama's scope creator, an 84-year-old lawyer and former FBI agent says, "An old man doesn't get excited about too many things, but I'm very proud of it." Good for you. He hopes to go to the inaugural parade, of course, with the Obama scope in hand.
If you can't make it to Washington though, you could maybe opt for this Obama-inspired souvenir. We saw plenty of them out there. How about Obama the fragrance? It's available for both men and women, on sale here in New York on probably any street corner for $45 a bottle. But our intrepid intern Greta --
BROWN: $45.
HILL: Yes. Talked the vendor down to $10 a pop. I took a sniff earlier.
BROWN: I should say. Let's be honest.
HILL: It's very strong.
BROWN: During the commercial break -- yes, we had a little whiff.
HILL: Not so much. I would say too, you we were talking about this. I'm not sure how it's legal to use the likeness.
BROWN: Maybe the Obamas get a cut. I'm sure the street vendors are like spending --
HILL: You know, they really should.
BROWN: Ten percent to the White House.
All right. Erica Hill for us as always. Erica, thanks.
The Obamas announced another member of their team today, the new White House social secretary, Desiree Rogers. She is a prominent Chicago businesswoman, a Harvard grad and a long-time member of the Obama inner circle. And she'll be responsible for every official event or ceremony that occurs anywhere in the White House or on the ground. And she'll have to help the future first family get settled too.
One woman who knows exactly what that job is like is Ann Stock. She was White House social secretary for President Clinton. And I talked with her about the challenges ahead for the Obamas just a little while ago.
(BEGIN VIDEOTAPE)
BROWN: So, Ann, a big part of your job was to turn this big anonymous house, the White House, into a home for the first family. And it's especially important when young children are involved. Tell us how you helped the Clintons, especially Chelsea Clinton settle in.
ANN STOCK, FMR. CLINTON WH SOCIAL SECY.: Well, I think the first thing that happened is you got marching orders from the president and first lady that overall they wanted the house to look and feel like America. The second thing was it's just making sure as part of that in settling into the home, that Chelsea felt comfortable.
And one of the first weekends that the Clintons right after the inauguration, they had moved into the house and she had some friends spending the night. And the ushers did a scavenger hunt to familiarize her with the White House and with everything that is in the White House. And she had a lot of fun with it but it also made her get into the house and feel comfortable.
BROWN: What a clever idea. You got to give them credit.
STOCK: And also, you're going to have all kinds of events. You're going to have different birthday parties. You're going to have sleepovers. That's the big thing right now, is who's going to be at the first sleepover? And you're going to have pool parties and you're just going to have lots of things going on within the house.
I think one of the things that's also very important is this is the first time in three or four years that President-elect Obama has actually been around all day and all night. And so that will be different for the girls. When he was senator he was commuting back and forth to Chicago.
BROWN: Right.
STOCK: So, essentially what you've got now is they're living over the store. And when they come home from school, they can slip over to the Oval Office to see him or he can come home and have a snack with them.
BROWN: A good point. An excellent point.
You know, social secretary also organizes all those big fancy state dinners too. STOCK: Right.
BROWN: The Clintons I remember hosted Nelson Mandela.
STOCK: Right.
BROWN: That was a giant production for you.
STOCK: That was huge.
BROWN: Tell us -- tell us a little bit about that event and whether you think a state dinner is something that the Obamas should take on early in his presidency?
STOCK: Well I think a state dinner actually isn't something that comes early in the presidency. The Mandela event was overwhelming, I'll tell you why.
He had just gotten out of Robbins Island where I think he'd been imprisoned for 27 years. And it was his first visit to the United States. And he is an incredible, incredible icon. So the pressure is on.
And what your listeners may not know is that a state dinner, there are only about 130 seats at the state dinner. So by the time you take out the official delegations of about 60, you've got maybe 35 couples that can be invited to the dinner.
BROWN: And what a ticket that must be.
STOCK: Oh, it was unbelievable. We actually --
BROWN: How to whittle that guest list down.
Ann Stock, appreciate your time tonight. Thanks so much.
STOCK: Thank you. Nice to be here.
(END VIDEOTAPE)
BROWN: Coming up, something for nothing. Really? We found a farm couple that is giving back to the neighbors this thanksgiving and may have earned our "Bull's-Eye" tonight.
(COMMERCIAL BREAK)
BROWN: On thanksgiving night, we are going to say thank you to an extraordinary group of people. They are CNN's heroes. Their actions deserve a celebration, and we saluted them over the weekend. Our Brooke Anderson was there.
(BEGIN VIDEOTAPE)
ANDERSON COOPER, CNN ANCHOR: Good evening, and welcome to our second annual tribute to CNN Heroes.
BROOKE ANDERSON, CNN ENTERTAINMENT CORRESPONDENT (voice-over): It's an awards show like no other.
TERRENCE HOWARD, CNN HEROES PRESENTER: I'm presenting an award to Liz McCartney, a woman who I think has the heart of a thousand angels.
RICKI LAKE, CNN HEROES ATTENDEE: I mean, it feels like the Academy Awards, and I feel like she's winning, you know, the great honor. Go, Marie. Go, Marie.
ANDERSON: A night to honor ten selfless individuals whose commitment and compassion for the less fortunate are making the world a better place.
COOPER: These are people who are not looking for fame.
UNIDENTIFIED FEMALE: Four (ph) please.
UNIDENTIFIED FEMALE: Here you go.
UNIDENTIFIED FEMALE: Thank you.
ANDERSON: Carolyn LeCroy started a project to connect kids with their incarcerated parents. Marie Da Silva founded a school in Malawi for AIDS orphans, and Tad Agoglia created the first response team of America.
UNIDENTIFIED FEMALE: CNN hero, Anne Mahlum.
UNIDENTIFIED FEMALE: Ladies and gentlemen, CNN hero, Viola Vaughn.
ANDERSON: Stars like Christina Aguilera turned the spotlight on these every day people doing extraordinary things.
CHRISTINA AGUILERA, SINGER: I am beautiful in every --
LAKE: An evening of emotion, meaning and hope.
UNIDENTIFIED FEMALE: It is a day I will never forget.
ANDERSON: Brooke Anderson, CNN, Hollywood.
(END VIDEOTAPE)
BROWN: And make CNN's heroes part of your thanksgiving. Anderson Cooper hosts our tribute Thursday night at 9:00 Eastern.
Finally tonight, our "Bull's-Eye." It has been a good year for Joe and Chris Miller's farm in Colorado. So after the harvest, instead of letting the last of the crop freeze in the fields, they invited anyone who wanted to pick leftover vegetables for free. Forty thousand people showed up, and they harvested some 600,000 pounds of leeks, potatoes and carrots.
(BEGIN VIDEO CLIP) DAVID PATTERSON, MILLER FARMS: It kind of shows tonight -- here it shows how the economy, what the state of the economy is. We've got a lot of needy families out here, a lot of churches, and a lot of food banks too. So we're having a blessed day.
(END VIDEO CLIP)
BROWN: The Millers get our "Bull's-Eye" because their kind of generosity, no small potatoes. That's it for us.
"LARRY KING LIVE" starts right now.
