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American Morning
Minding Your Business: Funding NASA
Aired February 03, 2003 - 07:46 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
PAULA ZAHN, CNN ANCHOR: President Bush will send Congress a $2.2 trillion budget today. The plan features new tax cuts intended to boost the economy.
For more on that, and a quick market preview, let's check in with Andy Serwer, "Minding Your Business" this morning.
Good morning.
ANDY SERWER, "FORTUNE" MAGAZINE: Good morning to you, Paula.
Let's talk about the past before we talk about the future. Last week, another sour one for investors. Let's take a look at the numbers -- there you go. Friday was up, but we were down for the week on the Dow, the Nasdaq and the S&P. Interestingly, a lot of people were speculating the market would be down this morning, Paula, because of the shuttle disaster, but so far, futures are up.
And we want to talk about the economic fallout of the shuttle disaster. You mentioned the president's budget. That is due to come out at 8:00 a.m. this morning, just minutes from now. And we already have some numbers regarding NASA's budget. Those numbers came out before the disaster happened as well.
You can see here, the important number is the 2004 number, OK? That is what the budget that is being released today concerns, is fiscal 2004. A $470 million increase for NASA has been proposed by the president. Again, I want to reiterate, that was proposed before the shuttle disaster.
ZAHN: So, there's a lot of speculation whether Sean O'Keefe, the NASA administrator, will go to the president and say, give us another half- billion dollars, which would...
SERWER: Right.
ZAHN: .. take care of the cost of one, single shuttle mission, or the cost of potentially replacing...
(CROSSTALK)
SERWER: That's right. And others may argue that maybe we should cut back on it in terms of this environment, because of the war situation. The shuttle itself, the shuttle program itself goes for about $3.2 billion. They were actually going to cut about $75 million out of that, and I don't think that's going to happen.
They sound like big numbers, but of course, the overall budget is $2.2 trillion, so this is all just a drop in the bucket.
As far as the national impact of this disaster, there really won't be that much. This is what analysts are saying right now. However, there should be significant impact in the state of Florida, unfortunately. The shuttle pumps about $4.5 billion into the state economy, employs about 25,000 people, half of it in Brevard County, where the Kennedy Space Center is. And in the 1986 Challenger disaster, that really hurt that county badly. Unemployment jumped from about 4.7 percent to 6 percent. So, the local impact there is significant.
Also, we should mention, of course, that Boeing and Lockheed Martin are the two companies that run the United Space Alliance, which is the joint venture that builds and maintains the shuttles. Those companies could be under pressure, and we'll be watching their stocks as well.
ZAHN: All right, keep an eye on all of that for us today.
SERWER: OK, I will.
ZAHN: Thanks, Andy.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
Aired February 3, 2003 - 07:46 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
PAULA ZAHN, CNN ANCHOR: President Bush will send Congress a $2.2 trillion budget today. The plan features new tax cuts intended to boost the economy.
For more on that, and a quick market preview, let's check in with Andy Serwer, "Minding Your Business" this morning.
Good morning.
ANDY SERWER, "FORTUNE" MAGAZINE: Good morning to you, Paula.
Let's talk about the past before we talk about the future. Last week, another sour one for investors. Let's take a look at the numbers -- there you go. Friday was up, but we were down for the week on the Dow, the Nasdaq and the S&P. Interestingly, a lot of people were speculating the market would be down this morning, Paula, because of the shuttle disaster, but so far, futures are up.
And we want to talk about the economic fallout of the shuttle disaster. You mentioned the president's budget. That is due to come out at 8:00 a.m. this morning, just minutes from now. And we already have some numbers regarding NASA's budget. Those numbers came out before the disaster happened as well.
You can see here, the important number is the 2004 number, OK? That is what the budget that is being released today concerns, is fiscal 2004. A $470 million increase for NASA has been proposed by the president. Again, I want to reiterate, that was proposed before the shuttle disaster.
ZAHN: So, there's a lot of speculation whether Sean O'Keefe, the NASA administrator, will go to the president and say, give us another half- billion dollars, which would...
SERWER: Right.
ZAHN: .. take care of the cost of one, single shuttle mission, or the cost of potentially replacing...
(CROSSTALK)
SERWER: That's right. And others may argue that maybe we should cut back on it in terms of this environment, because of the war situation. The shuttle itself, the shuttle program itself goes for about $3.2 billion. They were actually going to cut about $75 million out of that, and I don't think that's going to happen.
They sound like big numbers, but of course, the overall budget is $2.2 trillion, so this is all just a drop in the bucket.
As far as the national impact of this disaster, there really won't be that much. This is what analysts are saying right now. However, there should be significant impact in the state of Florida, unfortunately. The shuttle pumps about $4.5 billion into the state economy, employs about 25,000 people, half of it in Brevard County, where the Kennedy Space Center is. And in the 1986 Challenger disaster, that really hurt that county badly. Unemployment jumped from about 4.7 percent to 6 percent. So, the local impact there is significant.
Also, we should mention, of course, that Boeing and Lockheed Martin are the two companies that run the United Space Alliance, which is the joint venture that builds and maintains the shuttles. Those companies could be under pressure, and we'll be watching their stocks as well.
ZAHN: All right, keep an eye on all of that for us today.
SERWER: OK, I will.
ZAHN: Thanks, Andy.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
