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Jobless Rate Soars; Stem Cell Reversal
Aired March 06, 2009 - 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: Hi, everyone.
On a day when the number of Americans out of work reached a 25- year high, President Obama made a visit to a place where he could show just how in fact his stimulus plan really is saving jobs.
Bullet point number one tonight: the president in Columbus, Ohio, where two dozen police cadets whose jobs were saved as a result of the stimulus were sworn in as officers today. It's a story we have been following for some time now. The president insists today the nation is now on the right track.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: There were those who argued that our recovery plan was unwise and unnecessary. They opposed the necessary notion that government has a role in ending the cycle of job loss at the heart of this recession. There are those who believe that all we can do is repeat the very same policies that led us here in the first place.
But I also know that this country has never responded to a crisis by sitting on the sidelines and hoping for the best. I know that, throughout our history, we have met every great challenge with bold action and big ideas. That's what's fueled a shared and lasting prosperity.
I know that, at this defining moment for America, we have a responsibility to ourselves and to our children to do it once again. We have a responsibility to act, and that's what I intend to do as president of the United States of America.
(END VIDEO CLIP)
BROWN: And our bullet point number two tonight: a NO BIAS, NO BULL look at who is hiring in America right now. We want to show you why, despite the depressing unemployment news, many experts are now pointing to some positive signs.
And bullet point number three: For former President George W. Bush, it was both a political and an emotional flash point, federal funding of embryonic stem cell research. Today, we hear President Obama plans to reverse the Bush policy and provide the money.
So, what does that mean for medicine, for research, for treating sick people? Dr. Sanjay Gupta is going to here to explain it all for us.
And bullet point number four tonight: Michelle Obama sits down with Oprah Winfrey. Our "Political Daily Briefing" reveals the White House behind the scenes, from parties to new furniture, and how first daughters Sasha and Malia are adjusting. We will have all of that for you.
But we start on the job front. There is no getting around the fact that today brought more tough news, as unemployment hit a 25-year high. But, in places like Chicago, folks were lining up, looking for a new start at a job fair. Check it out.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: The market -- I have been looking for a job for a few months now, and it's just -- it's pretty saturated. And when you come to a job fair like this, there's so many people looking, it's just -- it's pretty difficult.
UNIDENTIFIED FEMALE: It's hard just receiving unemployment. I have a 14-year-old I am trying to take care of and I'm a single parent, so it's hard, very hard.
(END VIDEO CLIP)
BROWN: And we want to break down what you need to know about what's going on with jobs in this country right now.
Chief business correspondent Ali Velshi here with me to walk us through it -- Ali.
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: There's nothing I can tell you to break it down that breaks it down as effectively as people who are looking for a job and have bills to pay.
But let me give you the numbers that out first thing this morning. The unemployment rate in the United States has now climbed to 8.1 percent. -- 651,000 jobs were lost in January. Now, that's highest we have reported, but often they revise the numbers for the previous few months. And it turns out December actually lost more jobs than this.
But these are remarkably, remarkably high numbers. Remember the fact that you are supposed to grow 100,000 to 150,000 jobs a month just to keep that unemployment rate steady. When this recession started, unemployment was 4.9 percent, now 8.1 percent. Twelve-and-a- half million people are now unemployed. We started to shed jobs in January of 2008.
So, when you look at the cumulative jobs lost since the beginning of the recession, we have just been adding and adding and adding every month. We're now at 4.4 million jobs lost for this whole recession -- Campbell.
BROWN: And, Ali, take it a level further, if you will. Who are the unemployed, and where are the hardest-hit areas? VELSHI: Let's take a look at how this breaks down in terms of men and women and different ethnicities.
Men are at the same rate as the national level, 8.1 percent. Women are unemployed at a rate of 6.7 percent. If you break it down by ethnicity, women are -- sorry -- white people are lower than the national average at 7.3 percent.
Blacks, as typically this is the case, and it's been this way for a long time, much higher than the national average at 13.4 percent. Hispanics also have a higher than the national average rate at 10.9 percent, and Asians lower than the national average typically at 6.9 percent.
I think I can also show you how it breaks down regionally. These are the areas hardest-hit by unemployment. Obviously, you can see up in the Midwest, Michigan in particular has a higher than average unemployment rate. The Central South has a higher than normal unemployment rate. You can see that little blank spot there. That's Alabama. Alabama has a lot of non-unionized auto industry.
And they don't have -- they have got actually a very low unemployment rate. And the West, same place that you see a lot of foreclosures, we're also seeing a higher unemployment rate. So, that's how it divides up across the country, Campbell.
BROWN: All right, Ali, thanks very much -- Ali Velshi for us.
When President Obama spoke in front Columbus today in front of those new police officers hired with money from the stimulus, he wanted to prove that are there signs at the light of the end of tunnel, signs we have been looking for since we first spoke with the mayor of Columbus last month as things were looking pretty bad.
Back then, cadets were about to receive -- or who were about to receive their badges instead got layoff notices. Well, now things have changed.
(BEGIN VIDEO CLIP)
OBAMA: For those who still doubt the wisdom of our recovery plan, I ask them to talk to the teachers who are still able to teach our children because we passed this plan. I ask them to talk to the nurses who are still able to care for our sick and the firefighters and first responders who are still able to keep our communities safe. I ask them to come to Ohio and meet the 25 men and women who will soon be protecting the streets of Columbus because we passed this plan.
(CHEERING AND APPLAUSE)
(END VIDEO CLIP)
BROWN: Our political analyst Roland Martin first brought the Columbus story to our attention and he's joining us tonight from Milwaukee to talk about it.
And, Roland, you heard about the situation from the mayor of Columbus himself. What did he tell you?
ROLAND MARTIN, CNN CONTRIBUTOR: Well, I was in Columbus for several speeches over the court of three weeks. And he called me and he said -- he said, Roland, we're hurting. He said, and we're having to lay off people.
I was listen to the morning radio. And they were talking about the police class. But also what he talked about -- and this is very important -- that Columbus is a diversified economy. It's the state capital of Ohio. The Ohio State University is there.
But also they have a city income tax. So, when you lose jobs, they're losing their biggest source of revenue. So, he said, hey, we had to cut all kinds of different police. And so the police class was so important because you have to maintain public safety to give confidence in companies why they should continue investing.
And so it's a very difficult issue they had to confront that many other cities are confronting as well.
BROWN: Today's announcement, though, Roland, it saves 25 jobs. And I don't mean to undercut that because for those 25 families this is huge. It's great news for Columbus as well.
But for the president to go all the whole way to Columbus to tout 25 jobs, I mean, there are a lot of people who are going to say that's just a drop in the bucket.
MARTIN: Well, here is the deal. Whenever I talk to folks around the country and talk about how to save money, I say, look, you can't save a million bucks unless you start saving $1. And you can't get to 100 bucks unless you get to $10.
So the reality is the only way we're going to build this economy if you build it job by job, one by one. The 25 jobs, frankly, represents a microcosm in terms of how cities are being affected by this economy.
And so to say that, look, the stimulus package was able to affect these 25 jobs, here's what it means with public safety, here's what it means with building confidence, and so it's frankly giving you the example.
Whenever the president does these things, it's all a matter of saying here is an example of what happens when the government does something and has a much broader meaning. So, you are right, it is 25 jobs, but I will tell, you we can't replace any of those jobs unless we build it one by one. And so it may sound small, but in the long term, it all adds up.
BROWN: All right, Roland -- Roland Martin for us tonight. Roland, thanks.
From a six-figure salary at CBS to completely out of work and yet this family says, in many ways, their lives have never been better.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: These times are hard, but they seem to kind of -- you know, they bring you a little close together.
(END VIDEO CLIP)
BROWN: A ripple effect story you're not going to want to miss when we come back.
BROWN: As always, we're "Cutting Through the Bull."
And tonight we want to know why the Federal Reserve is helping insurance giant AIG keep its secrets. Our bailout dollars have saved AIG. The newest commitment from the Treasury Department brings the total so far to more than $160 billion, $30 billion promised this week alone.
The government's fear is that, because AIG is tied to so many other companies, its failure could yank everybody down with it. But this week, when Congress dared to ask the Federal Reserve who all is getting a piece of the AIG bailout pie, lawmakers ran into a wall of silence.
The Fed's vice chairman, Donald Kohn, refused to give up the names of those who made a cash grab as some of the money merely went in and then right back out of AIG, lining the pockets of some of its trading partners.
It's our money, so you would think we would have the right to know. These are not bonuses or grants. They are loans. We're doing Wall Street a very expensive favor right now. And, as a nation, we expect to be made whole on the debt, with no chance for money to be lost in the shadows of confidentiality.
The Fed must stop trying to play interference when it comes to following the money. Congress is warning, AIG won't get another dime if we don't get answers. And their message is one we wholeheartedly endorse. We expect, we demand transparency and accountability from all those getting government help through our money.
Moving on, for actor Michael J. Fox, it's always been personal. He's certain his own Parkinson's disease and other diseases could be improved, if not cured, with embryonic stem cell. But President Bush was absolutely set against using federal money for it. It's been an emotional and political flash point until now.
Today, we hear President Obama plans to reverse that Bush policy.
(BEGIN VIDEO CLIP)
MICHAEL J. FOX, ACTOR: I have this one message, and it's bipartisan and it's nonpartisan. And it's just about hope. It's just about giving hope a chance. I'm just really, really concerned if we close doors. (END VIDEO CLIP)
BROWN: That was an interview that he did with Anderson Cooper last year. And our Dr. Sanjay Gupta is going to be here to explain what we can expect with the president's new plan.
Tonight, we have learned President Obama is ready to make good on a campaign pledge. On Monday, he will overturn the Bush administration's controversial ban, as we said, on federal funding for embryonic stem cell research. We will have much more on that when we come back right after the break.
BROWN: Tonight, we have learned President Obama is ready to make good on a key explain pledge. On Monday, he will overturn the Bush administration's controversial ban on federal funding for embryonic stem cell research.
The Bush policy is haled by social conservatives who oppose the destruction of human embryos, but advocates for patients with disease like Parkinson's have been protesting the ban for years, among them actor Michael J. Fox.
He has Parkinson's and has set up his own multimillion-dollar foundation for Parkinson's research. He spoke to Anderson Cooper in 2006 about the stem cell battle.
(BEGIN VIDEO CLIP)
FOX: I have this one message, and it's bipartisan and it's nonpartisan. And it's just about hope. It's just about giving hope a chance. I'm just really, really concerned if we close doors because we think that our scientists aren't ethical enough to proceed down this path in a way that we as a country would approve of.
I think that we -- that the strictest ethical guidelines are in place. You know, but if we don't lead in this, another country is going to, and they're not going to -- we're not going to have the ethical oversight. And it's going to happen. So, we should do it.
ANDERSON COOPER, HOST, "ANDERSON COOPER 360": We -- we asked viewers to send in some e-mails, some questions.
Jacob in -- in Dallas, Texas, asked: "Why should an innocent unborn child, so that tests and experiments may be run, in an effort to possibly save others? How do we value one life over another?"
FOX: There is a -- there is something that is in place now, which is the destruction of thousands of these cells. It's happening. And it has been happening for 20 years.
COOPER: These cells are being thrown out?
FOX: They're being thrown out. They're being wasted, purely wasted. So, and, even with programs like adoption, it's not going to put a dent in it. They are going to be destroyed. And they continue to be destroyed.
(END VIDEO CLIP)
BROWN: Michael J. Fox puts a face on the debate, and he's a powerful advocate for stem cell research, but it still remains tremendously controversial.
For some perspective on the battle over stem cells, CNN chief medical correspondent Dr. Sanjay Gupta is joining us right now.
And, Sanjay, let's walk people through this.
DR. SANJAY GUPTA, CNN SENIOR MEDICAL CORRESPONDENT: Sure.
BROWN: There are different kind of stem cells. Explain to people what's so controversial about what the president is going to announce on Monday.
GUPTA: Well, when you talk about embryonic stem cells, the thing that's so controversial is, in order to get these cells, you have to destroy embryos. That's a simple way that you can put it. And that has led to controversy that has extended many, many years.
But your point is a good one. When you say stem cells sort of as an umbrella term, you are referring to several different types of cells. Adult stem cells are not controversial. You take those from adults. You can take them from their bone marrow, their liver, their blood.
There's also something known as IPS, induced pluripotent cells. You don't need to remember the name, but remember this. You can take normal skin cells and expose them to certain viruses that also make those skin cells revert backwards into embryonic stem cells.
Those are also not controversial. But this idea of creating federal funding for embryonic stem cell research is something people have been talking for some time. And we're hearing, like you are, there's going to be a reversal of the existing policies on that very issue on Monday.
BROWN: And explain to us why medical researchers are so excited about stem cell research and what they hope to accomplish ultimately.
GUPTA: If you take an embryonic stem cell, it's a -- what is called a pluripotent cell, a cell that can grow into just about anything.
And what is exciting about that is so many diseases simply need new cells, Parkinson's disease, diabetes. After someone has had an heart attack, heart cells die. Could you somehow replace those heart cells? That's where the exciting part starts to come in.
If you can take these embryonic stem cells, put them in the areas of the body that need those replacement cells, maybe you could start to see improvements in these chronic diseases for which we really have no cures as of right now.
BROWN: But people hear you say, you know, possible cure for things like Parkinson's or diabetes, and, realistically, I mean, how far off are we talking about before we would see a real breakthrough on that front?
GUPTA: That's a really good question.
And I will tell you, as a scientist, as a doctor, it's a bit of a moving target. And what I mean by that is that we have had such a period of time now without -- with only limited federal funding for stem cell research, when federal funding starts again, you may not see sort of linear improvements. You may see exponential improvements, because so much of science sort of builds on itself.
So, it could start to happen very quickly is what I am saying. But it's also worth pointing out, Campbell, that it was only in January of this year that we had the first approved clinical trial using embryonic stem cells, and that's looking at spinal cord injured patients.
They're recruiting patients this summer. We have talked to those doctors. We have talked to those scientists. They think it's going to be several years still, maybe three or four years, before we start to see the results. So, it's a ways off, but it may start to build quickly with these additional federal dollars.
BROWN: Dr. Sanjay Gupta, our chief medical correspondent, many, many thanks. And glad you're sticking around, Sanjay.
GUPTA: Thanks, Campbell. Glad to be with you, Campbell. Thanks.
BROWN: All right.
And, as we reported last night, Sanjay has, of course, taken himself out of the running for the job of President Obama's surgeon general.
Well, tonight, a new candidate is emerging, and he is sure to raise some eyebrows. Senior Democratic officials tell CNN that Howard Dean is a possible pick. The one-time national Democratic Party chairman is a medical doctor, as well as former Vermont governor, who championed health reform, health care reform.
When we come back: the latest details in a shocking case, Rihanna, Chris Brown, and how they become a police blogger item, instead of a romantic one.
BROWN: President Obama had hundreds of people lining the streets of Washington today. We're going to tell you what happened.
But, first, Gary Tuchman joins us with the briefing -- Gary.
GARY TUCHMAN, CNN NATIONAL CORRESPONDENT: Hi there, Campbell.
A manhunt in Cleveland ended tonight with the suicide of a newlywed husband suspected of killing his wife, her sister-in-law and her three young children last night. Thirty-three-year-old Davon Crawford, an ex-convict freed in 2007, was cornered in a house surrounded by police. He had reportedly told family and friends he wouldn't go back to prison.
A small home-built plane crashed into an R.V. park in Ocala, Florida, this afternoon. At least one person in the plane was killed and two recreational vehicles were destroyed.
There are signs a plea deal may be in the works for accused swindler Bernard Madoff. Madoff's attorney said tonight his client has waived his right to a grand jury indictment in a giant Ponzi scheme. Experts now say investors may have lost considerably less than the original estimate of $50 billion.
Pop star Rihanna will testify against Chris Brown if she is subpoenaed. Brown is charged with two felonies in connection with his alleged assault on Rihanna, his girlfriend. According to her attorney, she's not currently slated to take the stand.
Secretary of State Hillary Clinton had a lost-in-translation moment today in Geneva, when she gave Russian Foreign Minister Sergei Lavrov a gift referring to relations between the U.S. and Russia, a reset button. Well, that's what it was supposed to say.
(BEGIN VIDEO CLIP)
HILLARY RODHAM CLINTON, U.S. SECRETARY OF STATE: We worked hard to get the right Russian word. Do you think we got it?
SERGEI LAVROV, RUSSIAN FOREIGN MINISTER: You got it wrong.
CLINTON: I got it wrong.
LAVROV: It should be perezagruzka.
LAVROV: And this says peregruzka, which means overcharged.
CLINTON: Well, we won't let you do that to us, I promise.
(END VIDEO CLIP)
TUCHMAN: Overcharged. I guess it could have been worse. It was the secretary's first meeting with her Russian counterpart.
And, in London, a daring jewel heist is caught on tape, CNN tape. CNN reporter Sasha Herriman was in the middle of taping a story when thieves took a sledgehammer to a store window and grabbed hundreds -- maybe not hundreds, but handfuls, we're being told -- of luxury watches.
They roared off in motorcycles, no arrests yet. I guess those guys did not ever consider the fact they might end up on international television.
We are glad -- we are glad, Campbell, nobody was hurt, and we're glad that Sasha and her cameraman, Peter Kavanagh, are OK tonight.
BROWN: Yes, talk about timing there.
Gary Tuchman for us with the briefing -- Gary, thanks very much.
First lady Michelle Obama making news tonight -- she appears on the cover of the April issue of Oprah Winfrey's magazine, "O." It's the first time Winfrey has shared the cover with anybody else.
We will tell you more about Oprah and the first lady in a little bit.
Tonight, on "LARRY KING LIVE," Larry and his guests take your calls on where the jobs are in this economy. That's tonight, 9:00 Eastern.
BROWN: Here's the thing about the economy right now. Eventually, the hard times hit everybody. We call it the ripple effect. And the following story is a case in point.
In New York, one couple has gone from doing very well indeed to just hanging on.
MAVIS FOWLER-WILLIAMS, UNEMPLOYED: When is that? Let me see. That...
CAMPBELL BROWN, CNN ANCHOR (voice-over): Mavis Fowler-Williams works at home now. Her full time job is looking for a job. In January, she was laid off from CBS where she had a great job. She was a six-figure a year attorney. Her pedigree, outstanding, degrees from Columbia in both law and engineering.
Her husband Windell, a filmmaker, is working but work is much slower so they're both home a lot with 3-year-old India and her 5- year-old brother Takashi (ph). When she lost her job at the beginning of the year, the family lost its only secure income. But this story is about hope and about inspiration.
FOWLER-WILLIAMS: It's the core of who you are. It's the essence of your being. I think it's brought out a lot of the best of us. I mean, that's what tough times do.
BROWN: Their children are in expensive private schools in New York and their education is a priority. Mavis and Windell insist they'll make it work.
FOWLER-WILLIAMS: We are just much more concerned about, you know, not just budgeting financially, but just really paying attention to even the smallest kind of expenditures.
BROWN: They're not in a panic. In fact, they found this uncertainty to be good for them.
FOWLER-WILLIAMS: It does really help you to reconnect and, you know, just kind of go on many dates with each other like, you know, like you haven't been in a long time.
BROWN: The family is closer.
WINDELL WILLIAMS, HUSBAND: As opposed to on a Friday night or Saturday night going to pizzeria or going out to a restaurant, we will, you know, spend a lot more time in, which is great for the kids.
BROWN: But there is more. This is a story of our times for so many reasons.
WILLIAMS: You know that -- that President Obama is staying up late at night and wondering how can we make things better? How can I make things better for people who are suffering? You know he's doing that. So every time you look at him, you get inspired.
BROWN: And here's a story we never thought we'd have to tell. Americans forced out of their brick and mortar homes into makeshift shelters, a flapping canvas. Tent cities, another ripple effect of the economic crisis, in Sacramento, California, this time where some people are facing just an incredible test.
Dan Simon is in Sacramento for us right now with more on the story -- Dan.
DAN SIMON, CNN CORRESPONDENT: Yes, hi, Campbell. The state capital is actually just a few miles away. And amidst that backdrop, check this out. You can actually see some tents behind me.
It actually looks like we're at a camping site. But the people who are sleeping in these tents every night, they're not campers. These are people who are homeless and this is a very vast area.
This is an industrial area as we walk through here. About 300 people sleep out here every night and a good chunk of them, a good chunk of them are recently homeless.
And coming up, we're going to talk to you about how somebody goes from living in a house and in an apartment, having a good job, to winding up here sleeping in one of these tents. It's really an incredible story.
And one person told us he had a good job working construction, making $40,000, $50,000 a year. Now, he's living out here. Campbell, that's coming up.
BROWN: Dan, we're going to talk to you in a minute. We'll go back to you in just a bit.
I do want to show all of you an encouraging sign for people who are looking for work. All across the country there are job fairs galore. Here's just some of what you could find today.
A job fair in Charlotte, North Carolina, had thousands of people lined up and even more job fairs are scheduled for next week. Take a look from California to New York and cities in between. So dust off your resume, get ready.
Now if you are looking for a job, we do want you to check out CNN.com to see who is hiring in your area. And get the hot spots across the nation. You'll also find tips on how to land and keep a job a whole lot more. That's CNN.com/jobs.
And we should mention a special edition of "AC 360" this evening at 10:00, on a subject that is shaking the ground beneath more and more Americans every day -- finding and hanging on to work.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: People have to make some basic preparations in case they join the ranks of these unemployed.
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Which again is more likely than it was a year ago.
UNIDENTIFIED MALE: Yes. And for example, I mean, at the very least, people should have some sort of an emergency savings.
(END VIDEO CLIP)
BROWN: Jobs and joblessness on a "Money Summit" special edition of "AC 360." That's tonight at 10:00.
BROWN: The numbers are staggering and not even a man as cool and calm as President Obama usually seems to be could make it sound less than, well, awful. This was in Ohio earlier today.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Just this morning, we learned that we lost another 651,000 jobs throughout the country in the month of February alone, which brings the total number of jobs lost in this recession to an astounding 4.4 million -- 4.4 million jobs. Well, that is not a future I accept for the United States of America. (END VIDEO CLIP)
BROWN: The word the president used there, astounding. Reason enough, more than reason enough, to impanel the brightest minds this network could find to talk about jobs in this country. And here's an excerpt from a special "Money Summit edition of "AC 360." Tonight at 10:00, we urge you to watch. Take a look.
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: What are people who watch this supposed to do? They get this news that there have been all of these layoffs. What are you supposed to do about this?
RYAN MAC, PRESIDENT, OPTIMUM CAPITAL MGMT.: Well, the first thing they have to do is understand that, well, we have to take responsibility, understanding that you know what, this is something that we've been burdened with. It's not a pretty situation. It's not something that we would ask for, but take responsibility, understanding what can we do right now.
Secondly, we have to start looking for opportunity, you know, and try. The word for crisis has two symbols. One is dangerous. The other one is opportunity. So if we can start looking for the opportunity in these markets --
VELSHI: What is the opportunity here?
MAC: Well, we have green jobs. A lot of individuals -- green jobs in industries. You know, Facebook came out of the recession. A lot of individuals in companies are creating opportunity by just seeing what's out there, seeing what's going on in their communities and see what needs they can fulfill just by fulfilling their purpose in life.
UNIDENTIFIED MALE: In the meantime I think that's good but, I mean, right now, I think people have to make some basic preparations in case they join the ranks of these unemployed.
VELSHI: Which again is more likely than it was a year ago.
UNIDENTIFIED MALE: Yes. And for example, I mean, at the very least, people should have some sort of an emergency savings, ideally, three to six months worth of living expenses. And if you're close to retirement, if you're like in the, you know, 50s or 60s, very good chance that you could be forced into earlier retirement. That can be very problematic, so you should be looking, you know, going to one of these online calculators.
How much do you have saved? Is it nearly enough?
UNIDENTIFIED MALE: What would you do for health care? A lot of companies aren't offering early retiree health care, so you better -- you want to go out there and look around. Can I buy up a policy that will get me through until I would qualify?
VELSHI: Again, and those calculators are available on money.com.
DONNA ROSATO, "MONEY MAGAZINE," SENIOR WRITER: Walter is right. We need a survival plan, but we also do need to prepare if you have a job. And education is critical. I know it's something that Ryan has talked about before. But when you're looking at the unemployment rate and how it's spread out across different demographics, people who have a college -- with a four-year college education, the unemployment rate is 4.1 percent. It's a lot lower. That's up 40 percent, but education and retraining is really critical to holding on to a job and having a job long term which is what you need.
SONIA ALLEYNE, CAREERS AND LIFESTYLE EDITOR, BLACK ENTERRPRISE: We're finding people without college degrees. People who are "unskilled" are out of a job and so it's going to be very critical, as Donna was saying, for them to get retrained and to be prepared to get back into the marketplace.
ROSATO: A lot of those jobs are in construction and manufacturing.
ROSATO: And those have disappeared and that's where the green jobs may come in.
JOHN AUTHERS, FINANCIAL TIMES INVESTMENT EDITOR: Well, I think the other problem we have with this recession compared to previous recessions is that the baby boomers are much older, so many of them are over 60. They really like to retire soon please. And if their 401(k) is just half, that's going to be very difficult. And when you feed that through to what that will mean for asset prices for the economy, generally it's going to be a very big break on any recovery.
VELSHI: So those two are not -- the jobs loss situation, the stock market loss situation -- the two of them coming together is a real problem. A number of you have referred to previous recessions. I want to just take you over to the wall and show you unemployment rates.
We have taken the average of the last year of the last several recessions, obviously go back to the Great Depression. In 1933, the unemployment rate was 24.9 percent.
Now to be fair, we've changed the way we measure these things over the years. So they're not always apples to apples comparison. But take a look, 5.5 percent, 6.8 percent, 6.7.
Back in 1980, that was the average of the year even though for one month it got higher than that. 9.7 percent was the average unemployment rate then 6.8. Two recessions we went through with very low unemployment and now we're creeping back up to 8.1 percent.
Andy Serwer, there's nobody -- there's nobody who thinks that unemployment is not going to go higher as a percentage and that many, many jobs, more jobs are going to be lost in this recession.
ANDY SERWER, EDITOR, "FORTUNE" MAGAZINE: Yes. I was just going to say that. I mean, you know, you have to believe it's going to go over to 10 percent possibly. I really think it's going do that. And I mean you can see that becomes really, really historical. And you wonder about, you know, the psyche, the effect on confidence. We talked about that a lot.
BROWN: Now, if you have retirement -- a retirement savings account, you're probably afraid to see just how much of it has evaporated.
Well next in our CNN "Money Summit," what to do about your savings. Stay with us.
BROWN: We are back with more from our CNN "Money Summit." Everybody's investments are down these days, so should you hang tight or should you bail out? Here's what our money experts say in tonight's special "Money Summit" edition of "AC 360."
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Walter, what's the right thing to do as individuals? People who are watching this tonight? Should we be spending more to shore up this economy or saving more in case this recession last longer than we expect?
UNIDENTIFIED MALE: Well, I think you have to take your own situation and that of your family into account. If you've been building up debt where you don't have a financial cushion, you should be saving more money. You can't worry about what is good for the entire economy. You have to look, you know, what's good for you and your family and act accordingly.
VELSHI: Donna, I see you nodding your head.
DONNA ROSATO, SENIOR WRITER, "MONEY MAGAZINE": Yes. I mean, and also take the unemployment rate is very high, of course, and it's unprecedented but when you flip it around, the majority of people still do have a job. And Walter is right. If you've got a cash cushion and you don't have a lot of debt, then you can start thinking about spending money.
I think a good way to think about this is sort of some of the things we saw in the stimulus bill. Let's think about smart ways you can spend money. Now, it's going to save you money in the long run, investing in things that will make your home energy efficient, for example. That was in the stimulus bill. Things like that. Let's encourage people to spend money in smart ways and that will help everybody in the long run.
VELSHI: Right. What are the smart ways to spend money?
RYAN MAC, PRESIDENT, OPTIMUM CAPITAL MGMT.: Well, definitely I think on savings right now. I mean, for far too long, individuals have been borrowing for today what they hope to earn tomorrow, you know. So we've been living this life of false prosperity using debt as almost a license to pretend.
So again, I agree with Walter. Look at your own individual situations. Put six to nine months of living expenses into a savings account and then from that point on, move forward and start thinking about what you need to purchase for luxury items.
VELSHI: Let's take a look at personal savings rates over the last 30 years going back to 1980. As I mentioned around 1982, despite the fact we're in a recession, people were taking home more than 12 percent of the money that they earned with a little bit of a cushion in case that recession lasted longer.
Look at our savings rate. It has just gone lower and lower and lower as we started to carry more debt and become a much more credit- oriented society. We bottomed out a couple of years ago, very close to zero.
Now, we're saving a little bit more.
Steven Leeb, I want to ask you about this. What is it? What's going to take it -- what is it going to take to turn this around? What is it going to take for people to say I've got enough money. I'm still going to have a job. There are deals to be had out there on houses. There are deals to be had in the stock market. What happens?
STEVEN LEEB, LEEB CAPITAL MANAGEMENT: Basically, security. I mean, basically when people feel comfortable that their neighbor isn't going to be fired, that they're not in jeopardy, they will start spending again. But one message of this chart, Ali, is that there's no moral imperative to save or spend, rather -- to spend. Because look, we came out of the recession of the '80s with savings rates at 12 percent.
The job of the government right now is to pick up the slack. They should be the ones that are spending. They are spending.
And coming back to what Donna was saying, I think that's a terrific point. If you can spend, spend to save. Spend for energy efficiency. If you're going to buy a car, buy a car that has massive amounts of miles per gallon. That's a very good way of spending to get it back.
ANDY SERWER, EDITOR, "FORTUNE" MAGAZINE: When people are talking about you need to go out and buy things to be patriotic. I mean, is that the most ludicrous thing?
UNIDENTIFIED FEMALE: Yes.
UNIDENTIFIED MALE: Yes.
SERWER: That's why it sort of bothers me with these tax cuts often when they talk about, well, we'll give the people some money so they can go out and buy a DVD player. I mean, that is not helping things.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: You look at that -- you look at that chart, though, too, and one of the reasons that people have told me it was OK to have such a low savings rate is because we were saving our money in our 401(k). Our investments were kind of our savings.
SERWER: That didn't work out.
ROMANS: And so that instead of putting the money in the mattress and getting nothing, we were actually investing, except now our investments are down.
BROWN: And you'll see more from this "AC 360" special. Anderson, Ali Velshi and the CNN money team take on the dismal February jobs report, give you a job market survival guide. The "Money Summit" tonight, 10:00 Eastern.
And, of course, we've been talking about unemployment hitting a 25-year high. "LARRY KING LIVE" just minutes away now and he's going to have experts to tell folks exactly where the jobs are right now.
Tell us more, Larry.
LARRY KING, HOST, "LARRY KING LIVE": You're right, Campbell. This, as you know, is a bad time for more now than 12 million Americans out of work and we'll meet a few of them tonight and see what they're doing to manage.
Plus, we'll tell you where the jobs are, how to get them, how to stay afloat in a sinking economy. Survival tips headed your way. Get your calls ready. It's all next on "LARRY KING LIVE," Campbell.
BROWN: All right, Larry. We'll see you in a few minutes.
In spite of all of that, all that Americans have been through, they are going to incredible lengths to cope and wait until you see what we mean.
And he's the commander in chief but he's still a dad, so when the president and first lady head to, you know, a parent-teacher conference, well, they do draw a crowd.
BROWN: We told you earlier that we had the story of a tent city to tell you about, a tent city not in some faraway part of the third world. Again, it is a ripple effect of the hard times right here. In a beautiful city of a beautiful state, Sacramento, California, Dan Simon shows us what some of our neighbors have come to in these hard times -- Dan.
DAN SIMON, CNN CORRESPONDENT: Well, hi, Campbell. Of course, we're in Sacramento, the state capital, just a few miles away. We are in an industrial area. There's a factory just a little ways away from me. And as you said, you called this a tent city, and that's exactly what it is.
You see all these tents behind me, and they are filled with homeless people. And we're talking about a very vast industrial area. There are about 300 people living out here, and it's so vast that we can't actually show you all the people living out here. It's a few square miles.
And one of the things, when you look at the people who are out here, the homeless people, about 10 percent of them are people who are newly homeless. They are people who had good jobs, lived in homes and apartments. And now they suddenly find themselves out here.
Let's go ahead and introduce you to a few of those folks.
SIMON (voice-over): One is 50-year-old Jim Gibson. He's a construction worker and says he cannot find work. He says he made about $45,000 a year but then home building and construction slowed. Gibson downsized first from a house and then to an apartment. And when the recession stopped construction altogether, he ran out of money.
JIM GIBSON, HOMELESS: So it's kind of a mess. I didn't clean it this morning.
SIMON: Now, he lives here in a 3 x 6 tent.
GIBSON: The only thing that I can really say about my situation is that I am not the only one out here. There's a lot of people that are homeless because they choose to be, but I'm not one of those. We don't want to be out here. All we ask for is basically to be given a chance at given a job or some kind of work situation. And just let us take it from there and take care of ourselves.
SIMON: Gibson's wife died 12 years ago. He has five grown children, but he won't tell them he's here. He's too embarrassed, he says.
And just a little ways away, another new resident in this tent city, 50-year-old Tina Garland. She was a construction truck driver, and the work is gone. Her husband is also not working. They pitched their tent here 11 months ago.
TINA GARLAND, HOMELESS: It's so scary because you look at the economy and see that we're already out here, you know. I mean, we can't go a whole lot farther down. But we're going to be joined by hundreds, thousands of people because they're losing their houses. And after the shelters run out, then they're going to be out here like we are. (END VIDEOTAPE)
BROWN: You know, Dan, this is such a tough reality for many people right now. And with California's unemployment rate rising, it seems like it's going to get even worse.
SIMON: Yes, it's going to get worse, Campbell. And you realize that when you look at the statistics. California now number two in the country when it comes to foreclosures, the unemployment rate now 10 percent.
And you may ask why people here don't go to a homeless shelter. Well, there's a good reason for that. There are only 2,000 beds in Sacramento for homeless people and they're all full. So that's why they wind up out here in tent city.
And sometimes there's a silver lining to all this. There are little victories for people who are out here.
I talked to a guy who figured out how to get electricity from a utility pole out here. So a lot of people are happy. There's one guy who has a cell phone, and he's getting power from that guy who figured out how to get electricity. And we also found out that there's a guy who got a job at a local bowling alley. And he saved up enough money to leave tent city and find himself an apartment, Campbell.
BROWN: Again, Dan, not a story that, frankly, we ever thought that we would be reporting on in relation to this -- the bigger picture.
Dan Simon for us. A very tough story from California tonight. Dan, thanks very much.
We're going to take you back to Washington, back to the Obamas now. Michelle Obama has talked about her daughters. She says she wants Sasha and Malia to be treated like real kids, not like little princesses.
That's what she told Oprah Winfrey in an interview in the April issue of "O" magazine. The first lady also joins Winfrey on the magazine's cover. More when we come back.
BROWN: Erica Hill joining us right now with the "Political Daily Briefing." And there's one hot story tonight?
ERICA HILL, CNN CORRESPONDENT: There is one hot story. In fact, we may actually want to rename this segment tonight the personal daily briefing. It's all about the Obamas tonight.
So, let's start off with the first lady. Lots of news today. She can add another first to her list actually. That is because she's the first person to share the cover of Oprah's magazine with Oprah herself. The interview with Mrs. Obama doesn't actually hit newsstands until March 17th, but Oprah did release some tidbits today, so naturally we're sharing them with you.
On the family's first weekend in the White House, Mrs. Obama says it was almost like a wedding. She tells Oprah the last visitor didn't leave until Sunday and then Monday it started to sink in. "Now we live here. And Barack is getting up and going to work and it's just us. This is our home now."
She also talked to Oprah about making the White House feel like a home, noting the need for comfortable sofas because -- this part I love, I have to say -- "you've got to be able to make a fort with the sofa pillows. Everything must be fort-worthy." I totally relate to that philosophy.
BROWN: Fort-worthy indeed. And the girls, the daughters, also had a very big day today, too.
HILL: They did. In fact, especially for little Sasha, I believe. Parent/teacher conference is on this Friday. The president and first lady this afternoon making a trip to Sidwell Friends. It's about 20 minutes from the White House.
7-year-old Sasha's parent/teacher conference today. The crowds were gathered outside to wait for any glimpse they could get of the first family. Shocking, I know.
BROWN: Yes, I know. OK, and a story that I laughed out loud when I heard this. One thing that was not a big hit, President Obama's gift to British Prime Minister Gordon Brown.
HILL: I have to say, I laughed, too, when I read this story. So, here's the deal.
Earlier this week, I should say, as we know, the British prime minister was here. Some members of the press and a few bloggers complaining that there really just wasn't enough pomp and circumstance surrounding the prime minister's visit. Well, now they're dissing the gifts that he received.
A gift exchange between world leaders is a tradition. And for his part, Gordon Brown brought Mr. Obama a pen holder. It was carved from the wood of a sister ship to the HMS Resolute. Now, the resolute supplied some of the wood for the desk in the Oval Office which was given to the United States by Queen Victoria.
President Obama gave Mr. Brown a box set of 25 classic movies. The daily mail likened those DVDs to "a pair of socks from an unfamiliar aunt at Christmas." White House response, the gift exchange is a personal thing. We're not going to categorize it beyond that.
BROWN: Yes. He gets the hand-carved pen or whatever, and a gift certificate to Barnes & Noble.
HILL: Classic movies. Yes. BROWN: All right.
HILL: McDonald's gift certificates.
HILL: Here you go.
BROWN: Erica Hill for us tonight. As always, Erica, thanks very much. Have a great weekend.
HILL: You, too.
BROWN: And that is it for us. Don't forget to watch the "360 Money Summit" tonight at 10:00 Eastern time.
Have a great weekend, everybody. "LARRY KING LIVE" starts right now.