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Campbell Brown
Republican Civil War?; Stocks Plunge
Aired March 02, 2009 - 20:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ROLAND MARTIN, CNN ANCHOR: Hello, everyone.
Ever since President Barack Obama was elected, Republicans have drawn battle lines in their own party. The fight over whether to work with or fight the new president has exploded into near civil war within the GOP.
But, tonight, breaking news, signs of a truce, as Republicans try to hold it together.
Bullet point number one: Politico.com reports that Michael Steele, the Republican national chairman, is backing off after seeming to dismiss Rush Limbaugh's influence. The popular talk radio host had the crowd fired up at a convention of conservatives this weekend. But other Republicans are steering clear after Limbaugh's latest and pointed attack on President Obama.
(BEGIN VIDEO CLIP)
RUSH LIMBAUGH, RADIO TALK SHOW HOST: What is so strange about being honest and saying I want Barack Obama to fail if his mission is to restructure and reform this country so that capitalism and individual liberty are not its foundation?
(END VIDEO CLIP)
MARTIN: We will take a NO BIAS, NO BULL look at where Republicans really stand and why the White House is more than happy to put Limbaugh front and center.
Bullet point number two: another kick to the stomach on Wall Street. Stocks plunge below 7000, down nearly 300 points today, the same day we learn that insurance giant AIG is getting another $30 billion in bailout money. How is this not throwing good money after bad?
Our Ali Velshi is here breaking it down for us tonight -- Ali.
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Roland, I hope you like your job, because you and me and most of America is going to be working a lot longer, because your retirement fund took a big hit, 4 percent on major markets, bringing them down to levels that we haven't seen since 1996.
Why? Because AIG needs more money, and you're giving it to them. I will be back a little bit, Roland, with more on that.
MARTIN: All right, sounds good.
Bullet point number three: President Obama nominates Kansas Governor Kathleen Sebelius to be the secretary of health and human services. We're looking at how the president expects to pay for $600 billion in health care reform costs.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: If we're going to help families, save businesses, and improve the long-term economic health of our nation, we must realize that fixing what's wrong with our health care system is no longer just a moral imperative but a fiscal imperative.
Health care reform that reduces costs while expanding coverage is no longer just a dream we hope to achieve; it's a necessity we have to achieve.
(END VIDEO CLIP)
MARTIN: And bullet point number four: The ripple effect hits high-income America. We will take you to one of the wealthiest counties in the nation, where the list of those in need is growing dramatically.
Now to the struggle Republican face within their own ranks.
Over the weekend, on CNN's "D.L. Hughley Breaks the News," Republican Party chairman Michael Steele rejected the idea that Rush Limbaugh is now the real leader of the GOP.
(BEGIN VIDEO CLIP, "D.L. HUGHLEY BREAKS THE NEWS")
D.L. HUGHLEY, HOST, "D.L. HUGHLEY BREAKS THE NEWS": Like Rush Limbaugh, who is the de facto leader of the Republican Party.
MICHAEL STEELE, CHAIRMAN, REPUBLICAN NATIONAL COMMITTEE: No, he's not.
HUGHLEY: I will tell you what...
(CROSSTALK)
STEELE: I'm the de facto leader of the Republican Party.
His whole thing is entertainment. Yes, it's incendiary. Yes, it's ugly.
(END VIDEO CLIP)
MARTIN: Oh, but Limbaugh was not about to let that slip by unnoticed. On today's radio show, he fired back.
(BEGIN AUDIO CLIP, "THE RUSH LIMBAUGH SHOW")
LIMBAUGH: It's time, Mr. Steele, for you to go behind the scenes and start doing the work that you were elected to do, instead of trying to be some talking head media star, which you're having a tough time pulling off. I hope you figure out how to run a primary system. But it seems to me that it's Michael Steele who is off to a shaky start.
(END AUDIO CLIP)
MARTIN: Well, folks, tonight, we have the GOP chairman's answer and apology. Michael Steele tells Politico.com that he went too far in slamming rush.
Quote: "My intent was not to go after Rush. I have enormous respect for Rush Limbaugh. I was maybe a little inarticulate. There was no attempt on my part to diminish his voice or his leadership."
Another Republican hits back at Rush. He fires back, and they back down. Are they all scared of the radio talk show host?
Well, let's ask tonight's panel, author Frank Schaeffer, a conservative who voted for President Barack Obama -- his memoir of the early days of the religious right is "Called Crazy For God" -- Jason Mattera of the Young America's Foundation, a group of young conservative activists, and April Ryan, White House correspondent for American Urban Radio Networks.
And, folks, I have got to say, it's amazing to sit here and watch this battle back and forth between Rush Limbaugh and the Republican Party.
Jason, let's start with you. What in the heck is going on with the GOP?
(LAUGHTER)
JASON MATTERA, YOUNG AMERICA'S FOUNDATION: Well, first of all, did you just introduce someone as a conservative who voted for Barack Obama? I must have missed that.
(CROSSTALK)
MARTIN: Well, some did, now. Let's just be honest. Some did.
MATTERA: I don't know that's possible.
But, listen, Rush Limbaugh is not the de facto leader of the GOP. And if he were, as he said on his radio show today, he would be embarrassed, because the GOP lost overwhelmingly in 2006, had an awful candidate in John McCain, who couldn't articulate any type of conservative idea.
Rush Limbaugh is not the GOP de facto leader. He's a conservative radio host who has actually been moving the conservative movement, having it on his back for the last two decades. And I wish the GOP -- I wish Rush Limbaugh was the de facto head, because we wouldn't be in the mess we're in today. I wish, please.
(CROSSTALK)
MARTIN: Right. Now, Frank, I have got to ask you. Your father was one of the founders of the religious right. So, I guess are you taking it a little bit differently when Jason questions your conservative credentials?
FRANK SCHAEFFER, AUTHOR, "CRAZY FOR GOD": Yes.
(CROSSTALK)
MATTERA: If he voted for Obama, yes.
SCHAEFFER: Rush Limbaugh is to the conservative movement what Jabba the Hutt was to the "Star Wars" movies. He's interesting to look at, but, really, if you...
(LAUGHTER)
SCHAEFFER: ... if this guy is the face of the Republican Party, they're going to lose for the next 10 rounds, not just the next one.
I was involved with the religious right at the very beginning, with the pro-life movement, with people like Ronald Reagan, George Bush, the first president, and so on and so forth. Bill Buckley was a friend of mine. My dad was very close to him.
There was a conservative movement back in the day that was not all about grandstanding and where you would want America to lose its economic base, so that your party could win ideologically.
(CROSSTALK)
MARTIN: Jason, one second.
Frank, finish your comment.
(CROSSTALK)
MARTIN: Jason, one second.
(CROSSTALK)
MARTIN: Frank, finish your comment, please. Thank you very much.
(CROSSTALK)
SCHAEFFER: The problem is that Rush Limbaugh is not a patriot. He's out for himself. He's out for a conservatism that's anti- American unless America wins on his terms.
And I will tell you right now. I'm going to send him a bill for my pension fund if we go down the drain because the Republicans are grandstanding. The fact of the matter is, real conservatives are fleeing the Republican Party. What's left is the religious right and a bunch of neoconservatives. (CROSSTALK)
SCHAEFFER: Bill Buckley would be ashamed of what went on...
(CROSSTALK)
MARTIN: Jason, one second, please.
I want to bring in April Ryan.
April, you cover the White House.
APRIL RYAN, AMERICAN URBAN RADIO NETWORKS: Yes.
MARTIN: It's interesting to watch all of this. Even the last time there was an apology, you had a Republican member of Congress who criticized Rush Limbaugh. He came back the next day and apologized.
RYAN: Yes.
MARTIN: So, even Republicans are dancing around this whole issue. And there's a battle for the core constituency of the GOP right now.
RYAN: Political leaders, Republican political leaders and Democratic political leaders, know that Rush Limbaugh has some juice, just plain and simple.
Michael Steele said when he became the head of the RNC, he made a comment to President Barack Obama: How do you like me now?
Well, he needs to go back and look at that and talk to Rush Limbaugh about it, because this weekend, Rush Limbaugh, whether you say he's about himself, he rallied the GOP, the conservatives this weekend. It was a rah-rah, let's get together.
He's doing something right now that McCain and Palin did not do. So, Rush Limbaugh could indeed be the de facto head of the Republican Party.
MARTIN: But, Jason, doesn't that pose a party? Because frankly he's filling the vacuum, but he's not a political leader. He's a radio talk show host. He's not passing policy.
MATTERA: Well, he's an engine for conservative ideas. And he's giving the GOP, if they're willing to accept it and take the lead, intellectual firepower to fight the left.
And I must correct this supposed, alleged conservative, who Ronald Reagan and Bill Buckley would be turning in their graves to hear this man talk, and especially vote for Obama. The fact is, Rush Limbaugh doesn't want America to fail, as I guess alleged. He wants Obama's politics of coveting thy neighbor's good, redistribution of wealth, and anti-capitalism spirit, he wants that to fail, because it's against what America was founded on, the principles of individual liberty and free enterprise. (CROSSTALK)
SCHAEFFER: Excuse me.
If Rush Limbaugh wants President Obama to fail, what he wants to have fail is an economic policy in a sink-or-swim time that will either take us up or down.
(CROSSTALK)
MATTERA: He's already failed here.
(CROSSTALK)
MARTIN: Right. The Dow is down 2,800 points since his presidency.
(CROSSTALK)
SCHAEFFER: These are desperate times.
MARTIN: Jason, Frank, April, hold tight one second. I got to get a kick out of Jason. He wasn't even born when Frank started. But go right ahead. I get it.
(LAUGHTER)
MARTIN: Folks hold tight right there. Let's hear more of Limbaugh rushing to take on the new president.
(BEGIN VIDEO CLIP)
LIMBAUGH: Ronald Reagan used to speak of a shining city on a hill. Barack Obama portrays America as a soup kitchen in some dark night in a corner of America that's very obscure.
He constantly is telling the American people that bad times are ahead, worse times are ahead.
(END VIDEO CLIP)
MARTIN: Folks, tonight, who's really painting a picture of doom, as Limbaugh fights with the White House and a Republican Party in turmoil?
(COMMERCIAL BREAK)
MARTIN: Whether Rush Limbaugh really is or is not the de facto head of the GOP, his anger towards President Obama's policies is getting strong support from at least some conservatives.
It's been more than a month since Limbaugh first made waves and upset some of his own party's leaders by saying he wanted the president to fail.
Listen to the reaction when he hammered home the same point at a conservative conference this weekend.
(BEGIN VIDEO CLIP)
LIMBAUGH: This notion that I want the president to fail, folks, this shows you a sign of the problem we've got. That's nothing more than common sense. And to not be able to say it? Why in the world do I want what we just described -- rampant government growth, indebtedness that has -- wealth that is not even being created yet is being spent. What is in this? What possibly is in this that any of us want to succeed?
What is so strange about being honest and saying, I want Barack Obama to fail if his mission is to restructure and reform this country so that capitalism and individual liberty are not its foundation? Why would I want that to succeed?
(CHEERING AND APPLAUSE)
(END VIDEO CLIP)
MARTIN: With talk like that, Limbaugh may be doing more than just scoring points with a loyal audience. Is he pointing out a fault line that could set off an earthquake in his own party?
Let's bring back Frank Schaeffer, Jason Mattera, and April Ryan.
Now, folks I want to play another sound bite. This is from Mike Murphy, who was on "Meet the Press" this weekend. And of course he ran -- he was a strategist for Senator John McCain. He had some tough comments for the GOP.
(BEGIN VIDEO CLIP, "MEET THE PRESS")
MIKE MURPHY, REPUBLICAN MEDIA STRATEGIST: If we don't modernize conservatism, we are going to have a party of 25 percent of the vote going to Limbaugh rallies, enjoying every applause line, ripping the furniture up. We're going to be in permanent minority status.
(END VIDEO CLIP)
MARTIN: Now, Jason, look, I know you don't want that. But does Mike Murphy have a point that if you continue in terms of talking just to the base, they have a problem in 2010, more importantly, 2012?
MATTERA: Oh, hell no, not at all.
The problem is that the conservative leadership -- or actually politicians -- haven't acted like conservatives. You need to have an energetic base. I was at CPAC this year amen-ing Rush when he was talking. This year, it was an excited base.
Last year, when John McCain, we knew he was the nominee, and he was at CPAC, where there was a conservative after conservative they had to convince us that we should fall in line and support him. But everyone in the audience knew, well, we are screwed in '08. We have had an inarticulate person in John McCain. We had a pseudo- conservative in George Bush. We had the same thing with Bob Dole.
(CROSSTALK)
MARTIN: George W. Bush, pseudo-conservative?
MATTERA: The problem is not with Rush Limbaugh. The problem is with the people who are supposed to be leading us in the political world.
(CROSSTALK)
SCHAEFFER: Well, you said one thing -- hey, you just said one thing I agree with there.
And that is the problem is with the people, because the people just blew you guys off and told you where to go with your extremist view of conservatism. That's the problem.
(CROSSTALK)
MATTERA: Extremist view? You voted for Obama, buddy.
(CROSSTALK)
SCHAEFFER: It's going to be you and about 15 million voters when this Republican Party keeps getting narrower and narrower and narrower.
(CROSSTALK)
MATTERA: Except that Rush Limbaugh has an audience of 22 million people.
SCHAEFFER: Read my book.
(CROSSTALK)
MARTIN: Frank, finish your point.
(CROSSTALK)
SCHAEFFER: You don't know what you're talking about.
RYAN: Oh, wow.
(CROSSTALK)
MARTIN: OK.
Hey, guys, I want to go to April right now.
(CROSSTALK)
SCHAEFFER: It's very -- it's very simple. But let me tell you something. The problem -- when you start saying this guy wasn't conservative enough, this guy didn't have a pure enough ideology, this guy's hair color was wrong, this guy was no good on TV...
(CROSSTALK)
MARTIN: One second, Jason.
(CROSSTALK)
SCHAEFFER: What is wrong is, the Republican Party has gone too far to the right.
(CROSSTALK)
MATTERA: I feel like I'm in the Twilight zone.
(CROSSTALK)
SCHAEFFER: ... gone too far to the right.
MARTIN: Thank you, Jason. Hold tight. You got a little fired up.
April, I want to go to you.
Before I go to you, here's where Rahm Emanuel, chief of staff to President Obama, had to say on "Face the Nation" about this battle that we're seeing played out right here between Frank and Jason.
OK. Don't have the bite there, April.
But Emanuel said that Limbaugh is leading the GOP. Surely, the White House is loving this whole battle taking place. And they're egging it on. Even Robert Gibbs, the spokesman, alluded to it today.
RYAN: Yes, he did.
Of course, Roland, Rush Limbaugh is not a political leader. So, they can attack. They can make the statements. Rush Limbaugh, again, many people are considering one of the leaders of the Republican Party, because he's rallying everyone.
But you have to remember, Roland, those words of failure, he wants the president to fail, no matter what context you put them in, they're very strong words. I have talked to people in the religious right, leaders in the religious right, saying, yes, we want to see him succeed, but, yet, certain issues, to include the growth of government that is unnecessary and the spending, that's what they don't want.
But you have also to remember this, Roland. When George Bush was president just a few months ago, he said, you know, no matter what the party, we want you to succeed. He was talking about all the living presidents, to include himself, for Barack Obama.
And you have to remember, this is not -- failure is not partisan. If he fails in any point, the whole country fails.
SCHAEFFER: Absolutely. RYAN: And it could have a ripple effect for the world economy as well.
SCHAEFFER: Absolutely.
MARTIN: Now, Jason...
(CROSSTALK)
MATTERA: Excuse me, but the country is already failing with these policies. I mean, since...
(CROSSTALK)
SCHAEFFER: They're failing in George Bush's right lean policies.
(CROSSTALK)
MARTIN: Frank, April, hold tight one second.
Jason, make your comment. You got about 30 seconds.
MATTERA: OK.
Since Obama has presented his stimulus plan, the Dow has tanked. We know that socialist ideas, when implemented, fail time and time again, so why would we continue to go back to these wornout dogmas, as Obama stated in his inauguration address?
(CROSSTALK)
MARTIN: We got you, Jason.
(CROSSTALK)
MATTERA: Free markets is going to...
(CROSSTALK)
RYAN: This is worse than a White House briefing.
(CROSSTALK)
MARTIN: Hold tight.
April, go right ahead.,
(LAUGHTER)
RYAN: President Obama has got to find a way to learn how to rally the American public, as well as the markets at the same time. And that's something that he's charged with, because, right now, it's a very precarious mix that he -- he's not he's not worked it out yet to its -- to the best of his ability, but he has to rally that.
(CROSSTALK) MARTIN: Frank, go right ahead. Frank, go ahead.
SCHAEFFER: One way to rally the markets, if the GOP cared about this country more than politics, would be to get behind the president and say, we may not agree with every detail, but, just as in the time of war, we stand together.
Look, my son served in the Marine Corps. He was in Afghanistan twice, in Iraq once. I do not have to apologize to people for saying we should stand up for our country.
Let me tell you this. We're in two wars. We're in an economic showdown. And people who do not get this are going to paint themselves into a corner. If the GOP wants to look unpatriotic now...
MARTIN: Right.
SCHAEFFER: ... and not back the president, be my guest.
But if Rush Limbaugh is our poster boy...
MATTERA: Please.
SCHAEFFER: ... you can kiss the GOP goodbye for the next 20 years.
(CROSSTALK)
MARTIN: Frank Schaeffer, Jason Mattera, April Ryan, this conversation here I think will continue for -- until 2010. We will see what happens with the GOP. We will be following every single step. Thank you very much for joining us. We appreciate it.
Folks, now, if you think you can't go through money fast enough, how about a company that just lost $62 billion -- that's billion with a B. -- in only three months? And now taxpayers are going to give them billions more.
(COMMERCIAL BREAK)
MARTIN: We keep hearing about companies that are too big to fail.
One of them, insurance giant AIG, just got another $30 billion bailout from the federal government. Did that make Wall Street happy? No. The Dow Jones industrials and the S&P fell to their lowest point in nearly 12 years today. Are more billion-dollar bailouts the best thing for Wall Street?
Well, chief business correspondent Ali Velshi is here to follow the money for us.
Ali, give us some context. Why are we seeing the markets react the way they are, just falling through the floor?
VELSHI: Well, markets like certainty. And they don't like uncertainty.
And all we have right now is a big fat dose of uncertainty in the markets. Take a look at what happened. We got news first thing in the morning that AIG is announcing the biggest bailout -- is announcing the biggest loss than we have ever seen in one quarter, $62 billion. And that's what ended up with the markets down 299 points. That's more than 4 percent. That's your 401(k). That's your IRA.
We saw that loss because AIG had this big loss. HSBC had another big loss today, HSBC announcing that it's laying off 6,000 people in the United States.
Now, the bottom line is, every extra person that is laid off is one more person who is not a contributor to the economy, but they're getting money back from the economy. So, you put this all together, it looks like a recession that is deep and we don't have a light at the end of the tunnel yet, which is why you saw that loss was on the stock market.
MARTIN: OK, look, now, we're hearing AIG get all this money. Most folks don't even know what AIG is.
VELSHI: Yes.
MARTIN: Look, we have all kinds of insurance companies. Why are we putting so much money into this one company?
VELSHI: I want you to think back to September, when Lehman Brothers failed. Now people look back at that and think the government letting Lehman Brothers fail was a problem.
Lehman Brothers was not nearly as connected to the world economy as AIG is. Lehman Brothers was an investment bank. They make deals between investors and people who want -- who have -- who need money. This is a different story.
AIG has 74 million insurance policies around the world, 130 different countries. And AIG, it's not just the home insurance or the auto insurance that you think that you have got.
(CROSSTALK)
MARTIN: So, when I think of Allstate and State Farm and those kinds of companies...
(CROSSTALK)
VELSHI: Yes, this is a bigger company. This is a bigger company.
You have got homeowners insurance, auto, travel, life insurance, things like that. But, also, AIG is in the business of insuring 401(k)s, mutual funds, the S&P 500, the Dow. It insures financial products. So, it's not just that.
Take a look at what else we have got. AIG insures banks, major airlines against catastrophe, Hollywood movies, oil rigs in the Gulf of Mexico against hurricanes.
So, here's the thing, Roland. People don't do business if somebody can't take that risk. We can't do that. So, AIG, here's the thing. If they disappeared, who would take on that risk? It's not clear that others wouldn't pick it up. But it's not clear that they would either.
Now, let me tell you, I had a conversation today with the CEO of AIG. And I have talked to him about that.
MARTIN: Right. Yes, what did he have to say?
VELSHI: I was asking him about how long this is going to go on for and how long it's going to be before Americans get paid back. Listen to what he told me.
(BEGIN VIDEO CLIP)
EDWARD LIDDY, CEO, AMERICAN INTERNATIONAL GROUP: We have about 1,500 counterparts. So, from an institutional stand point, the failure of AIG would rattle through the financial system on a worldwide basis, with consequences perhaps not unlike those of what happened with Lehman Brothers when it failed.
But I would encourage you also to think about what happens on the retail side. As I have said to several people this morning, this is the United States of America. We can't have people standing in front of banks wondering they can make deposits -- we can't -- or withdrawals. We can't have people standing in front of life insurance companies wondering if their policies are safe. We need to keep some confidence in the system.
(END VIDEO CLIP)
MARTIN: So, basically, we have no choice but to help this one company?
VELSHI: Well, we could not help them, but we don't know what the consequences of not helping would be. And that's the bottom line. It could be fine. The world could go on perfectly without it. We just don't know, because the last time we let a major company fail, it kicked us into a global crisis, financial crisis.
MARTIN: All right, Ali, we certainly appreciate it. Thanks a lot.
VELSHI: All right.
MARTIN: As trouble on Wall Street ripples across the country, we went to a wealthy suburb where folks are lining up at the food bank. You know they never expected to do that.
And could you eat on only $6.28 a day? Our Sean Callebs did it to prove a point about food stamps. We will talk to him coming up.
(COMMERCIAL BREAK) MARTIN: We throw around a lot of big numbers these days.
President Obama's budget plan for 2010, $3.6 trillion, the deficit, $1.75 trillion, the stimulus bill, $780 billion -- numbers, numbers, numbers. But that doesn't begin to tell the story of people hurt by this recession.
In these tough times, it's all about feeding themselves and their families. But some people who never thought it could happen to them are relying on food banks.
We have been traveling across the country to see how Americans are making ends meet. We call this project "The Ripple Effect."
Dan Simon has tonight's story in San Francisco.
(BEGIN VIDEOTAPE)
DAN SIMON, CNN CORRESPONDENT (voice-over): Claudia Bartram had been a successful sales rep, also a college graduate who had once taught high school English. Yet, we found her at a place usually reserved for the needy.
(on camera): You have never been to a food bank before?
CLAUDIA BARTRAM, RECENTLY UNEMPLOYED: No, this was my first time.
SIMON: What was it like going in there?
BARTRAM: It was very emotional.
SIMON (voice-over): She says she has always relied herself, 59 years old and divorced. She had saved up a comfortable nest egg, more than $100,000. But stock market losses have hurt.
BARTRAM: It's been a tsunami. It's been one thing after another. And you're like, things can't get worse. And then they do.
SIMON: A few weeks ago, she lost her job at an in-home care service for senior citizens. Revenues were down, so they had to let her go.
She's using what's left of her savings to pay the mortgage on her $350,000 condo, which she says is now worth less than what she paid for it. Stretched to the limit, Claudia needed help.
BARTRAM: I felt shame, felt humiliation, felt, you're an intelligent person with a good education, with a good job. How in the world how you found yourself in this situation?
SIMON: Nowhere can the economic ripple be seen more than at the nation's food banks, like this one outside of San Francisco.
ELLIS GOLDBERG, FOOD BANK VOLUNTEER: This is kind of the bottom of the barrel. The more people hit the bottom of the barrel, that's the real indicator of where the economy is at, not what the Dow Jones industrial average is sitting at.
SIMON: Last year, nationwide, food banks saw a 30 percent increase in volume. But, for workers here, that's not as surprising as the kind of people they now see coming.
LARRY SLY, FOOD BANK DIRECTOR: People are coming in with this apologetic thing: Look, I have never been here before. This is not something I have ever had to do. What do I do?
SIMON: At this smaller food bank in Marin County, one of the most affluent areas in the country, the changes have been striking.
DAVE CORT, COMMUNITY CENTER DIRECTOR: We have people in marketing, software. We have a lot of realtors that live out here. So, those are the people we're seeing that, for the first time, are really getting hit hard.
SIMON (on camera): More than 80 people came through here today. That's about 50 percent more than what they were seeing just a few months ago. And until recently, the policy was you could come here every other week. But with things getting worse and more people losing their job, they've changed that. They're now allowing people to come every week.
(voice-over): Desperate to hang on to as much cash as she can, Claudia filled up a bag with about $50 worth of groceries.
UNIDENTIFIED MALE: She got apples --
UNIDENTIFIED FEMALE: And apples, pasta, some canned goods.
SIMON: And now she says to last a couple of weeks. Claudia says there is irony with her situation. After all, she used to donate to food banks. Now, she's having to take from them.
(END VIDEOTAPE)
ROLAND MARTIN, CNN ANCHOR: Dan Simon joins us live from San Francisco.
Dan, look, this is putting a lot of stress on food banks. I mean, how are they dealing with this significant demand?
SIMON: Well, it's certainly a tough situation. You know, I just got off the phone with a food bank director in the San Francisco Bay Area, and this is pretty common for what's happening in a lot of big cities. Right now, they're able to keep up with the demand. Grocery stores, food manufacturers, the federal government, they've kicked up their donations to offset the demand.
The problem is what happens a few months from now if the demand stays the same, or if it actually increases. What they fear is that they might actually have to turn people away or reduce the amount of food that a person gets. But, of course, right now, we're dealing with unchartered territory so they don't know what's going to happen.
MARTIN: It's certainly a sad story. Dan Simon in San Francisco, we certainly appreciate it. Thanks a lot.
Folks on food stamps don't exactly get a blank check. In Louisiana, a single person gets only $176 a month. That's about $6.28 a day. Could you get by on that?
Well, our Sean Callebs wanted to find out for himself. So for the month of February, he spent only $176 on food. Sean is in his kitchen in New Orleans tonight.
Sean, now, look, you did this for a month. How difficult was that? And how can somebody really live and eat on $176 a month?
SEAN CALLEBS, CNN CORRESPONDENT: Well, you know, Roland, actually $176 is the maximum one person can get. That is the very most. And I want to pick up on a couple of things we heard, subjects talking, Dan Simon's story.
The whole issue of shame and the humiliation people talk about really food stamp programs across the nation are trying to get rid of that. Instead of food stamps, now they have this debit card. Here in Louisiana, it's actually called Louisiana purchase, and it works just like a debit card when you go up there.
To get to the point, how do you eat on $6.28 a day? Let me show you what I'm going to have for dinner later on today. I made this chicken breast last night, a little blackened seasoning on top. This was about $2.
This can of sweet peas, 79 cents, I'll have maybe half of it. And this rice, boy, I tell you, Roland, rice has become my friend. I'll just have a bit of that. So you got a meal for what? $2.50 here and you'll spend more on dinner than you will on any of the other meals.
But here's some mistakes. OK. This is what I did wrong.
I bought these things -- these instant mashed potatoes, other prepackaged items, Mac & Cheese. And this can of chowder here, if you look on the back, it's got 70 percent of the recommended sodium intake for one day. So health problems that people, you know, on food stamps do face are really significant problems.
And one other thing -- the whole social aspect. It's amazing how much of your life revolves around going out to eat. If you're at work, if you're with friends, who say let's grab (ph) lunch, let's go out to dinner, and if you're somebody like Dan profiled who suddenly finds him or herself on food stamps, you don't have that option. It's difficult, it's embarrassing, and people tend to say, you know, I'll grab a bite with you next time. It's tough.
MARTIN: Sean, we got about 45 seconds left. And look, you had an opportunity to go to the grocery store. Many people live in neighborhoods where they're food deserts. They don't have grocery stores, lots of liquor stores. They have fast food restaurants. And so, they don't have that option. And so, isn't that also a difficult problem we're seeing in rural and inner city areas? CALLEBS: Yes, exactly. And we're talking about food deserts. You're talking about people who don't have transportation, so they can't jump in a car and go to a large grocery store.
You talk about convenience stores, liquor stores. They go in and that's when you find people's issue really harsh comments, like I saw that person buying six bags of chips and soda. Well, you know what, they're not a lot of options. Potato chips and soda, it's not the best way to spend that money but these people are really caught between a rock and a hard place.
One final item, you cannot buy prepared food on food stamps. You can't go into fast food restaurants. You can't go into restaurant. And if you buy prepared food in a grocery store, you have to leave. You can't eat it like at a counter or something there. You have to take it home.
MARTIN: Well, for you Sean, you get to eat a big meal tomorrow. But for a lot of folks, they'll eat that same piece of chicken for the rest of the month. So, that's really a sad story.
Sean Callebs, we certainly appreciate it. Thank you so very much.
Folks, tonight, news on a group of boaters, including two NFL players missing at sea on a weekend fishing trip on Florida's Gulf Coast. We'll see one man's dramatic rescue.
And at the top of the hour on ""LARRY KING LIVE"", what you can do to hang on during the stock market's wild ride.
(COMMERCIAL BREAK)
MARTIN: Secretary of State Hillary Clinton dives into two days of Israeli-Palestinian diplomacy tomorrow. Her goal -- to shore up a cease fire in the Gaza Strip. That's in our "Political Daily Briefing" tonight.
Erica Hill is here. And, Erica, just two weeks after her trip to Asia, another road trip for the secretary of state.
ERICA HILL, CNN CORRESPONDENT: Yes, very busy starting off very quickly with all of these visits, Roland. As you mentioned, Secretary of State Clinton making her first official trip in this role to the Middle East.
First off is a donors' conference in Egypt where global leaders raised nearly $3 billion to rebuild the Gaza Strip. Now despite the faltering economy back in the U.S., the Obama administration pledging $900 million to that effort, money the secretary promises will end up where it's intended to.
(BEGIN VIDEO CLIP)
HILLARY CLINTON, SECRETARY OF STATE: We have worked with the Palestinian Authority to install safeguards that will ensure that our funding is only used where and for whom it is intended and does not end up in the wrong hands.
(END VIDEO CLIP)
HILL: Secretary Clinton is expected to meet with Israeli officials later tonight. Tomorrow, she is scheduled to sit down with Palestinian President Mahmoud Abbas.
MARTIN: Well, Erica, some developing news tonight. Another Obama administration official and issue with taxes. All right. What's the deal?
HILL: You may have thought it was all over.
MARTIN: Right.
HILL: But no, it's another gift that keeps on giving. But this one --
MARTIN: Under (INAUDIBLE) too.
HILL: Well, maybe you should talk to him, Roland. A little bit many trend. I'm going to go out on a limb here and say it is not a great trend.
Former Dallas Mayor Ron Kirk, nominated as U.S. trade representative, turns out he owes the federal government $10,000 in back taxes. That's according to the Senate Finance Committee.
And as you mentioned, Roland, he's the fourth Obama nominee to have tax issues. Just to refresh your memory here, Treasury Secretary Timothy Geithner, of course, also a couple of issues. The president's first choice for health secretary underpaid. Former Senator Tom Daschle withdrew his nomination after his tax problems became public, as did Nancy Killefer, who, of course, was initially tapped to be President Obama's chief performance officer. She withdrew.
The White House, as it turns out, standing by Kirk who says he will pay. Maybe you could give a little call in. Let us know.
MARTIN: Well, his alma mater, hope it wasn't University of Texas. Well, that will serve him right there. I'm an aggie (ph).
All right. So much more than vetting, America's favorite ex- governor is back. My man Blago from Illinois, he's got something happening, Erica?
HILL: Indeed, there's always something happening with him. Come on. (INAUDIBLE) his hair, let's be honest.
Tonight, it is a six-figure book deal to be exact. That is according to Rod Blagojevich's spokesperson. Oh, yes, he still has one.
The disgraced former Illinois governor's advance is said to be one of the largest ever from an independent publisher. But that's not the only reason he's going independent. Check out this press release from the former governor's rep.
"He simply did not want to accept constraints or conditions on what he could say in this book. There were some people in high places who didn't want the governor to write this book and worked to try to squash a book deal."
Translation -- this could be juicy. We're told the working title is "The Governor," very original. Some other suggestions from the staff here at NO BIAS, NO BULL -- "If I Did It," "Big Boss Man" and "Jailhouse Rock."
I have to say, though, I find he tends to put the "oi" in Blagojevich, if you will.
MARTIN: He's an interesting guy. A lot interviewed him many times. We'll just leave that interesting.
All right, Erica.
All right. What's the deal with more drama over the first lady and this portrait?
HILL: You'll love this story. I know.
MARTIN: It's the stupidest story of the week. I'm just going --
HILL: You know what? I totally agree. It's ridiculous. But it's out there and it turns out everybody is talking about it, the all-important "Sleevegate" as some bloggers are referring to it.
Why the discussion of sleeves? Well, because the first lady doesn't have any in her official portrait which was released late last week. This has some up and arms, if you will. They find the sleeveless look too casual. But it's nothing new for Mrs. Obama, let's be honest.
We saw it on the trail. We also saw it here on "People" magazine, her two recent magazine covers, "People" and also on "Vogue," sans sleeves. And she didn't let the naysayers stop her from wearing that purple dress to the president's address before Congress last week.
And on the flip side, and this may make you feel a little bit better, Roland.
MARTIN: All right.
HILL: There are some people who've been inspired by her fearlessly toned arms. Some folks even posting workouts on line to get those arms.
I have to say it has made me admit that I need to pick up the weights myself.
MARTIN: Right.
HILL: So if nothing else, Mrs. Obama, you're inspiring me to get rid of the bubble arms.
MARTIN: I mean, what's the big deal? I mean, a sleeveless dress. I don't understand. I'm sorry. That's just me. OK, whatever.
People have too much time on their hands.
All right. We have dramatic video tonight of a gas station clerk in no mood to give up his money, albeit no sleeves. He's in our news briefing tonight. Stay with us.
(COMMERCIAL BREAK)
MARTIN: Lots and lots of news happening right now. Gary Tuchman joins with us "The Briefing -- Gary.
GARY TUCHMAN, CNN NATIONAL CORRESPONDENT: Hi, Roland. We're following the search for those NFL players lost at sea while fishing. We now have dramatic new images of the one man rescued so far.
Former University of South Florida player Nick Schuyler clinging to the boat 35 miles off Florida's Gulf Coast. He can be seen sitting on top of the engine of the capsized boat wearing a lifejacket. Still no sign of Oakland Raiders linebacker Marquis Cooper, former Detroit Lion Corey Smith, and a fourth man. Schuyler told rescuers the boat was anchored when it flipped Saturday night in rough seas and the other men became separated.
Much of the East Coast is digging out after a late winter storm dumped nearly a foot of snow from the Carolinas up to New York City where public schools were closed for the first time in five years. Boston, the rest of New England are getting the worst of it. Forecasters predict 15 inches on the ground there before it's over. Hundreds of flights had to be cancelled.
The man charged with stealing as much as $50 billion from investors doesn't want the government to take his home. Papers filed by the attorney for accused Ponzi scheme mastermind Bernard Madoff claim a $7 million New York penthouse actually belongs to Madoff's wife, Ruth. He's using the same rationale to try and stop $62 million in other assets from being seized.
And it may not have been the smartest thing to do, but a gas station clerk took matters into his own hands during a holdup in Ohio. Surveillance videos shows the clerk reaching across the counter and grabbing the robber in the Ohio County East Liverpool and shoved him out the door, even after the clerk was dragged across the counter and right out the door. The suspect is still on the loose. The very brave man may be fool hearty but certainly courageous, Roland.
MARTIN: Big up for that clerk, Gary.
TUCHMAN: That's right.
MARTIN: Thanks so much. "LARRY KING LIVE" is just minutes away. He has special guests tonight and he's asking some important questions about the stock market.
Larry, what's the big story tonight?
LARRY KING, HOST, "LARRY KING LIVE": Roland, we've got more on Wall Street's latest nosedive today. Why isn't anybody bailing you out? Not you, Roland, you know, you, everybody.
Plus, a primetime exclusive with Louisiana Governor Bobby Jindal. We want to know what everybody else wants to know this week. What about that speech? We'll ask what he makes of all the comments and the criticism. And we'll get his take on the Republican Party turmoil within.
Is it tearing the GOP apart? All next, Roland, on "LARRY KING LIVE." Good to have you with us.
MARTIN: I appreciate it. I'll take some AIG money.
Larry, thanks so much.
Folks, we'll be right back.
(COMMERCIAL BREAK)
MARTIN: President Obama today nominated Kansas Governor Kathleen Sebelius to be his secretary of health and human services. Now, we knew that was coming so here's the real headline, folks.
Check out the president in your face defiant of the critics who say he'll never be able to achieve health care reform.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I realize that there are those who simply don't believe Washington can bring about this change. And the odds are long. It's failed too many times.
There are too many special interests and entrenched lobbyists invested in the status quo. That's the conventional wisdom, and I understand those doubts.
But I also know this. I didn't come to Washington to take the easy route or to work for the powerful and the well-connected interests who have run the city for too long. I came here to work for the American people. I came here to deliver the sweeping change that they demanded when they went to the polls in November.
I don't think anybody has a silver bullet when it comes to health care. There are some difficult tradeoffs to be made. There are some difficult choices to be made. But what I do know is this -- that people of goodwill collectively recognize that the path that we're on is unsustainable.
(END VIDEO CLIP)
MARTIN: Tough word for the president. There are plenty of hurdles on the way to health care reform. Senior medical correspondent Elizabeth Cohen is ready with her diagnosis.
Now, Elizabeth, look, Tom Daschle was initially chosen, former senator insider, knew all of the players. He had to withdraw. Now the president goes outside. How can Sebelius, if confirmed, get this through when she's not from inside the beltway?
ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: Right. Well, some people would say she might have an advantage being an outsider. She hasn't made anyone mad yet you could say. But a lot of people see that losing Daschle was indeed a big loss to Obama's cause. As you said, he knew everyone. He had literally written the book on health care reform.
She's had some mixed results in her own state when she tried to insure all children in Kansas ages 5 and younger, it didn't work. The Republican legislature wouldn't go for it.
Also, she tried to enact a cigarette tax to help fund some health care expansion measures, and that also didn't work. But, Roland, on the other hand, she did manage to arrange for Kansans to be able to buy prescription drugs from Canada sometimes at a 50 percent discount. That's no small thing.
MARTIN: So what are the roadblocks the president has to face?
COHEN: OK, let's go over some of the roadblocks because there are quite a few of them. First of all, the expense. We're talking about $634 billion over ten years. That's a lot of money.
Also, some people are profiting from a current system as it is, pharmaceutical companies, insurance companies. They're going to have to, sort of be convinced to go along with the change. Also, politics is a huge roadblock. Look what happened to Hillary Clinton in the early '90s, she took a big hit.
MARTIN: Well, we've got a president who's confident about this. How can he get around these roadblocks?
COHEN: Right, he has a plan for getting around all three of them. So, let's go through the plan.
First of all, for expense. What he says he's going to do is he is going to get rid of waste. And everyone agrees there's tons of waste in the health care system in America. And also, he's going to tax the rich. Now some say that's not nearly enough to fund it and they're worried that average Americans are going to get a hit here as well.
Also, as far as profits go, he says he's going to get businesses onboard because businesses are suffering because health care costs are so incredibly high. Some businesses are just closing down. Also, he's trying to make the case that this is part of the economic recovery -- improving health care is part of the economic recovery.
MARTIN: Elizabeth Cohen, we sure appreciate it. Thanks a lot.
COHEN: Thanks.
MARTIN: Lots of people got a snow day today. That includes a couple of kids whose dad say Washington is wimpy about the snow. The latest on that inside the White House tonight.
(COMMERCIAL BREAK)
MARTIN: Millions of people have been following President Obama's every move since he was sworn in. Even with a spotlight on the president and his family, there's a lot you don't know about what goes on inside the White House.
Dayo Olopade, Washington reporter for theroot.com, is ready for a closer look at the Obama family.
Dayo, you've got a lot of details inside the White House tonight. First of all, talk to me about the purple folder?
DAYO OLOPADE, "THE ROOT": Oh, well, the purple folder is a very special document prepared for the president every day by his aides. It contains ten letters from regular Americans who have written in to the White House telling their president, asking him for different things.
A very good example was a letter that came from the girl in South Carolina that he previewed in his address to Congress last week. And this is part of, you know, keeping the president connected to the people, something that he has talked a lot about wanting to do and differs, I guess, a little bit from the bubble that President Bush was said to be in.
MARTIN: The president has lots of meetings, so exactly what is his daily routine?
OLOPADE: Well, the president gets up at the crack of dawn, as you would imagine, he's a busy man. A lot like President Bush, actually. He works out every day. He has breakfast with his wife. And in the midst of all the, you know, the national security and economic briefings, he does take the time to try and see the country. You've seen him travel a lot.
He'll be in Ohio next week. It's something that's very important to him to stay grounded is to keep familiar faces around and to make sure he's home every night to have dinner with his family. That's something he's mentioned as being the most important part of the day. And, of course, he has friends over to play basketball as well sometimes.
MARTIN: Dayo, when he was back in Chicago, of course, his daughters went to school in D.C., no school. So a little extra time with the daughters? OLOPADE: That's right. He has complained about D.C. being a little wimpy in canceling school for a snow day, but I think he might be eating his words. He got to spend a little extra time with his daughters this day.
Michelle Obama also canceled some of her daily events because of the D.C. school system, because of the snow, was shut down. So the whole family actually got to spend the day together in the White House, which I think was nice for them all. I think that's what the president would have liked.
MARTIN: Well, Dayo, we certainly appreciate it. Thanks a bunch. Folks, you can check her out at theroot.com.
In our "Bull's-Eye," what happened when a woman reported for army duty and brought her children along.
(COMMERCIAL BREAK)
MARTIN: Getting out of the army doesn't always mean getting out of the army. Ask Lisa Pagan who's in our "Bull's-Eye" tonight.
Four years after she got out, the Army recalled her to active duty, no excuses allowed. So, she came bringing along her two preschool children. Her husband travels a lot and they can't afford child care.
(BEGIN VIDEO CLIP)
LISA PAGAN, BRINGING CHILDREN TO ACTIVE DUTY: I was ready at any time, so I had my daughter to maybe called back. You know, I didn't have any problems with it then, but now our situation has changed.
(END VIDEO CLIP)
MARTIN: The Army took a second look and she is now on her way to an honorable discharge. That's very good.
That's it for us, folks. Campbell is back tomorrow.
"LARRY KING LIVE" starts right now.
