Return to Transcripts main page
American Morning
Vote on Boehner Debt Plan Delayed; America's AAA Rating at Risk; Coach Accused Of Urinating In Public; California Secures Big Loan In Case U.S. Defaults On Debt; Boehner Debt Plan Hits Snag; Congress Still Working Through Debt Ceiling Talks; Dollar Losing Value Against Other Currencies; Nation's Students Less than Proficient in History; 9/11 Health Fund Won't Cover Cancer
Aired July 27, 2011 - 07:59 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CHRISTINE ROMANS, CNN ANCHOR: A bill to raise the debt ceiling doesn't quite cut it.
I'm Christine Romans.
Today's vote on House Speaker John Boehner's plan is pushed back because it doesn't offer the spending cuts Republicans thought.
We are live in Washington to look at what this means for the deadline now six days away.
KIRAN CHETRY, CNN ANCHOR: It's debt D-Day. You're right, Christine.
I'm Kiran Chetry.
From America's AAA credit rating to the overall economy, to your finances, we're breaking down what will happen if Congress fails to raise the debt ceiling in just six days.
ALI VELSHI, CNN ANCHOR: And I'm Ali Velshi.
A 9/11 health plan won't cover cancer. We will speak to first responders and advocates who call it an insult -- on this AMERICAN MORNING.
(MUSIC PLAYING)
ROMANS: All right. Good morning, everyone. It's Wednesday, July 27th.
And the debt stalemate continues.
CHETRY: That's right. Time is running out.
House Speaker John Boehner has a plan considered a live plan and put it up for a vote. Actually, he ended up pulling it because it's under fire from members of his own party.
VELSHI: The problem is the numbers do not add up. So, today's vote has been postponed. And in just a few hours, House Republicans will meet again.
ROMANS: Joe Johns is live in Washington.
Joe, how big of a setback is this for the speaker on this?
JOE JOHNS, CNN SENIOR CORRESPONDENT: Yes. Well, you know, if you lose a day and you only have six days left -- well, yes, that's a problem. But the greater problem, perhaps, is losing credibility.
The speaker said his plan was going to save something like well over a trillion dollars. It turns out it's only $850 billion by the score from the Congressional Budget Office. That is a problem, too.
On the other hand, he gains a little extra time to try to round up some support because as we all know now, some Republicans on the Hill have been saying they won't vote for his plan, it can't pass. And he certainly needs a win when and if he puts this thing on the floor.
CHETRY: All right. So, when we say when and if, is there enough time for some sort of deal to be worked out?
JOHNS: Well, you know, the elephant in the room, if you will, is that there could be just a bit more time than has been publicly acknowledged. The United States government saying borrowing authority ends on August 2nd, but analysts in the U.S. have suggested the cash position on August 2nd may be stronger than expected due to additional tax revenues coming in.
I spoke to the Treasury Department and they would not sort of put numbers to that idea. They simply would not tell me what a stronger cash position might mean.
But if this is true, as the analysts suggest, the U.S. may be able to buy another week or so to pay the bills.
Treasury has been downplaying that, but as the tinkering goes on, they could use the extra time.
The other thing to watch is, around 10:00 Eastern Time, right on Capitol Hill, representatives with Standards & Poor's and Moody's investor service are going to be there talking to the Congress. Congress listening carefully because the one thing everybody is worried about is a downgrade of the U.S. credit rating.
ROMANS: Can I make a remark about the extra time? So many people are kind of buzzing about that today and some people are saying, oh, it shows the Treasury Department, they were overplaying what -- it doesn't matter. A few extra days doesn't matter. That's what they are supposed to be doing, right?
I mean, this is -- this is the end of the runway. I mean, whether it's a couple of days. The tax receipts change every day what's coming in. I mean --
VELSHI: Just we get a few days here could be taken off on the other side.
JOHNS: Right. All you're talking about is wiggle room at this point. Just a little bit of wiggle room.
VELSHI: Thanks, Joe.
JOHNS: You bet.
VELSHI: We'll check in with you through the course of the day.
ROMANS: It still makes us look bad. All that wiggle room still makes us look bad.
CHETRY: We talked about the pressure that people are hearing that members of Congress are hearing from their constituents. I don't know if that will help move this forward as you talk about maybe having a few more days.
But, clearly, people are very frustrated by this.
ROMANS: We talked to Florida Republican Governor Rick Scott a few minutes ago. He would rather not se the debt ceiling increased despite what every economist has been saying.
Earlier on AMERICAN MORNING, I asked him why he doesn't think that an unprecedented government -- potential government default, not raising the debt ceiling would wreak havoc on this nation's economy.
(BEGIN VIDEO CLIP)
ROMANS: If you don't raise the debt ceiling you have an immediate cut in 40 percent, 40 percent of federal spending. I mean, the impact near term on the economy would be disastrous. Doesn't this have to be done with a little more thoughtfulness than just an 11th hour electioneering?
GOV. RICK SCOTT (R), FLORIDA : We've been doing this and it hasn't helped our economy. We did the stimulus, it didn't help our economy. What's going to help our economy is act responsibly --
ROMANS: After years and years of tax cuts supposed to grow jobs and that hasn't helped either, right?
SCOTT: If you look at the states growing like out our state., we have no personal income. We're phasing out the business tax. Look at Texas, they have lowered taxes, they are growing.
So, absolute lower taxes make the economy grow. Higher taxes, more regulation, trillion dollar deficits -- that kills our economy.
(END VIDEO CLIP)
ROMANS: So, there's a distinction between cutting what we spend in the future and raising the debt ceiling right now, which is paying for what both parties of Congress have already spent.
VELSHI: And Republican Senator Pat Toomey of Pennsylvania unveiling a plan to prioritize what will and will not get paid if Congress fails to raise the debt ceiling. I spoke to him earlier in the morning and asked him what's worse, raising revenue or failing to raise the debt ceiling.
(BEGIN VIDEO CLIP)
VELSHI: If we hit the debt ceiling, 40 percent of our government spending would stop. That's got to be worse for the economy than closing some tax loopholes.
SEN. PAT TOOMEY (R), PENNSYLVANIA: No. I think the most important thing for the economy is getting us on a sustainable fiscal path. We have seen what's happening on the periphery of Europe, to countries that just refuse to grapple with this problem, and raising taxes a little bit here and there or a lot is going to do some harm to the economy and it's not going to solve the underlying problem.
(END VIDEO CLIP)
VELSHI: Senator Toomey went on to say he does not believe we will default but he just wants a plan B in place just in case.
All right. Before you can get a credit card, banks run a credit check on you. The ratings agencies run credit checks on companies, countries and financial products. We had a lot of questions about who these ratings agencies are and what they do. Standard & Poor's and Moody's and Fitch Ratings analyze how risky a company is and they give that debt a grade that reflects the borrower's ability to pay its underlying loans.
Now, the safest bets like the U.S. government get AAA credit rating. Now, for the U.S., it's been that way since 1917 when Moody's first assigned a credit rating to the United States. But as we've been discussing, this could change very soon.
Now, take a look at these 19 countries. These are the countries that have received S&P's AAA ratings. You can see a lot of them here. Australia, Canada, France, Isle of Man, New Zealand and, of course, United Kingdom, United States, Switzerland.
Why do these credit agencies matter? Who listens to them?
Well, investors across the world look to these credit rating companies to judge where to invest their money. For governments, the ratings agencies have a lot of power because they help determine the interest rate that the bonds those companies -- those countries sell to investors will receive.
As I mentioned, the safest bets, the most secure countries pay the lowest interest rate when they borrow money.
So, who pays these agencies? That's another question we have been getting. Agencies are either paid by the borrower, the country, or the company that is requesting a rating, or from subscribers who receive the published ratings and related credit ratings from Standard & Poor's and Fitch.
Now, Standard & Poor's tells CNN that the sovereign U.S. rating is unsolicited. In other words, the U.S. government does not pay for its credit rating.
ROMANS: Great analysis, Ali.
Our AAA credit rating is not the only thing on the line here if the Congress cannot reach an agreement on raising the debt ceiling.
Joining me now is Paul La Monica, assistant managing editor at CNNMoney.com.
You know, defaulting on our bonds. We're not going to do that. We're just not going to do that. We're going to pay the interest on our loans, but it might not prevent us from being downgraded by these agencies anyway if we don't raise the debt ceiling and get, you know, our house in order.
What happens here? The difference between default and downgrade and what does a downgrade mean for us?
PAUL LA MONICA, CNNMONEY.COM: A downgrade could be very bad news. I don't know if I go further to say it would be disastrous. But losing the AAA credit rating in theory should mean that interest rates will go higher, bond rates go higher, and all of the rates tied to that, things like mortgages and auto loans, student loans, et cetera -- they could go higher as well. So, it could be more costly for consumers to borrow money, not just corporations.
ROMANS: How much political damage is being done by this debate now in Washington? I mean, could it be -- we have heard people say this, people who hold bonds, it could be we are downgraded no matter what happens at this point.
LA MONICA: I'm getting the sense that unless there is a real plan to not just tackle raising the debt ceiling but a real long-term viable plan to cut the deficit going forward, there could possibly be a downgrade by one or more of the rating agencies, because they have explicitly said they want to see not just raising the debt ceiling, they want to see us lowering spending and getting our fiscal house in order.
ROMANS: We talked to Governor Rick Scott from Florida earlier, who said, you know, we should just forget about the debt ceiling. We don't need to raise it. That's a minority opinion.
If we don't raise the debt ceiling, what your sources are telling you happen here?
LA MONICA: If we don't raise the debt ceiling and then that wiggle room runs out and come past the middle of the August or whatever is and then we really have to start worrying about making other interest payments or making other payments, period, that is very bad news.
Right now, the financial markets have been relatively calm despite all the lunacy in Washington, and I think the sense is something is going to get done. This is politics as usual.
But we saw what happened in 2008 when politics as usual meant voting down the bank bailout and the Dow fell nearly 800 points.
ROMANS: And then, suddenly, they passed the bank bailout when they saw --
LA MONICA: Yes, funny how that works out.
ROMANS: We don't want -- they are calling it a TARP moment. We certainly don't want another TARP moment because that's something that affects all of our 401(k)s and IRAs, and also confidence to the U.S.
LA MONICA: Exactly. I mean, the one thing that a lot of people I speak to have been mentioning, you know, for a while now is that the good news about the U.S., if you will, is we are not Europe. Things are not as dire as, say, Greece, Portugal -- some of the troubled, very heavily debt-laden countries there.
But this is almost as bad from the sense of it's a political default. And I think a lot of investors -- China, for example, is the largest holder of our debt and it is not in our best interest tick them off probably. This does not bode well if we can't get our act together, play nice and do what's right for the country.
ROMANS: All right. Paul La Monica from CNN Money on why a downgrade would matter to you even if there isn't a default overall on our bonds. Thanks so much.
LA MONICA: Thank you.
VELSHI: That's a good distinction that we have to start making.
CHETRY: Well, nervous, frustrated, even frightened. Voters are jamming the switchboards and crashing servers on Capitol Hill, demanding that lawmakers figure out a way to solve the debt ceiling crisis. In fact, the phones in House Speaker John Boehner's office were twice as busy as usual with hundreds of callers waiting on hold for nearly an hour just to be able to leave a message.
CNN also surveyed Web sites of 279 members of Congress and found 104 of them were crashed or sputtering. There are reports that the White House switchboard was so also overwhelmed with calls it shut down during parts of the day yesterday.
VELSHI: So, we want to know. Maybe you didn't get through, maybe you did, what would you tell your elected representative? E- mail us, give us a tweet, tell us on Facebook. We'll read through some of them later in the show.
CHETRY: All right. Coming up next, we're going to talk to Congressman Jeff Flake, a Republican from Arizona, who is one of the Republicans who said they cannot support John Boehner's plan to put forth -- to try to get this debt ceiling cap raised. We are going to ask him why and whether there is room for compromise at this eleventh hour.
ROMANS: Also, still ahead, better bring an umbrella to work this morning, folks. Rob is watching severe weather. Winds, hail, possible tornadoes. We'll tell you where.
It's 11 minutes after the break.
(COMMERCIAL BREAK)
ROMANS: Seattle Mariners have now lost, whoa, 17 games in a row!
CHETRY: And we're here to rub it in this morning. Poor Mariners.
ROMANS: Yes. That streak ended, or continued last night. Struck out -- gosh, again, 18 times in Yankees Stadium.
The Mariners are now six games away from the Major League record of 23 consecutive losses set by Kiran's husband's favorite team in the world, the Phillies.
CHETRY: This is funny because Ali then said in the 6:00 hour of AMERICAN MORNING --
VELSHI: That the Phillies is the losingest team in the history of professional sports.
ROMANS: That's true. We fact-checked it.
CHETRY: But to be fair you play more games in baseball, so more opportunities to lose.
VELSHI: By the way, they are World Series champions and, you know
CHETRY: So, there's a lesson to be learned here. You can be the losingest team and you can also be the World Series champs and have an incredible season.
VELSHI: And Philadelphians are such nuts that they are probably proud of that.
CHETRY: Well, they played what amounted to time wise more than two games. Last night's Braves/Pirates game was 19 innings. It was more than 6 1/2 hours long, and those who stayed up to see the end were not happy. They witnessed what many are saying is the worst call of the year. The braves won 4-3, but this play at the plate at the bottom of the 19th.
At the bottom of the 19th, that feels weird saying at the bottom of the 19th. But check it out. He's out, right, clearly. No, he was called safe. The runner out by a mile. The umpire called him safe.
VELSHI: Because he was tired. He just wanted to go home. The umpire says I signed up to be a baseball umpire not a cricket umpire.
(LAUGHTER)
VELSHI: This is like a cricket match.
ROMANS: We're in the bottom of the 19th debt ceiling negotiations.
VELSHI: I heard that. I thought, no, you bet (ph) ninth, right?
ROMANS: Right.
VELSHI: Nineteenth inning. It was going on when I woke up for work this morning.
(LAUGHTER)
VELSHI: All right. You got to go, you got to go. The quarterback coach for the University of South Carolina was arrested after police say he relieved himself outside a restaurant right in the middle of downtown Greenville. Police say George Magnus was drunk and uncooperative. He's has been suspended from his coaching duties until all of this get straightened out.
ROMANS: All right. Rob --
VELSHI: Cool it, Christine.
CHETRY: Rob Marciano is hard to say when your nose is stuffy. I feel for you.
ROMANS: Both of your voices are ringing in my ears on both sides. Hi, Rob.
ROB MARCIANO, AMS METEOROLOGIST: Good morning, guys. You know, while we're on the sports thing, let's go down under and show you this piece of video of the Australian rules football. Very kind of similar to rugby. This guy -- look at that! Climbing the ladder to go high. It's shaking there. Nice catch.
(CROSSTALK)
CHETRY: You know the funny thing about this, Rob, is that the other guy seems completely unfazed --
(CROSSTALK)
MARCIANO: They're on different teams. So, he just got faced. He completely got faced and --
VELSHI: That is excellent.
MARCIANO: All right. From there, we go to the much more tranquil sand castle building contest. You know, Com Akon (ph) is happening in San Diego. One of our iReporters took a break from that and decided to head to the beach where, by the way, it's been lovely in the past couple of weeks when everyone has been searing a heat temperatures in a 100. San Diego to San Francisco, temps on long beach in the 60s. So, beautiful sand castle building weather.
All right. If you are traveling today, we are looking for delays in Tampa, Orlando, and Miami because of the afternoon thunderstorms. Also Chicago may see some thunderstorms as well and some of this could become severe anywhere from Minneapolis to Madison back to Chicago. And we had a record breaking rain over the weekend in Chicago, almost seven inches in just a few hours.
If they get another half inch or so, I think they'll break a record for the month of July. So, it's been wet there, but they'll take it versus seeing some of the heat. One of the reasons I showed you a lot of that video is because our maps aren't working all that well. But one point I do want to make is this. Here is your drought monitor. This is showing exceptional drought across pretty much the entire state of Texas.
We do have a tropical system that's developing right now along the Yucatan Peninsula and is expected to get into the Gulf of Mexico. If it goes into Texas, it may not be a bad thing. We could use that rain, certainly. We don't want it to get to hurricane strength, and there's a possibility that happening, but we're hoping for some rainfall in Texas. We'll be monitoring that throughout the day. Hurricane hunter aircraft is expected to go end to this thing. It could affect the U.S. as early as Friday or sometime over the weekend.
VELSHI: Like you said, it just brings a little rain, it will be fine. If anything more than that, it's a concern. We'll track it along with you, Rob. Thank you.
MARCIANO: You bet.
VELSHI: All right. We're "Minding Your Business" next.
Plus, something you've got to see. A comedian makes a rack video about the debt ceiling crisis, and I have to say, it's one of the most compelling things I've seen so far. It is 19 minutes after the hour.
(COMMERCIAL BREAK)
VELSHI: Twenty-two minutes after the hour. "Minding Your Business" this morning.
The state of California is preparing for a potential U.S. default. The state has secured a loan worth about $5.5 billion from various big banks including Goldman Sachs and Wells Fargo. So, it has cash on hand in case the debt ceiling is not raised in time, and it can't get the federal funding it needs to pay its bills.
Right now, U.S. stock futures are trading pretty flat down slightly ahead of the opening bell. Investors worldwide are watching Washington today. More stalls in the debt ceiling talks pushing both Asian and European markets lower overnight.
Health care provider, Aetna, just reported that its earnings for the second quarter were in line with Wall Street's expectations. Boeing also reported expected earnings for the quarter. The big surprise this morning is profits for Dow chemical jumped 74 percent in the last quarter compared to the same time last year. Still waiting on Delta to report its earnings before the opening bell this morning.
Still ahead, a debt plan by Speaker John Boehner has forced the nation's Republicans to choose sides. One of those republicans, Congressman Jeff Flake, who says there was no way he would be on board is going to be talking to us live in just a couple of minutes. AMERICAN MORNING is back after the break.
(COMMERCIAL BREAK)
CHETRY: Well, the House Speaker's debt reduction plan has run into some trouble as we've been reporting all morning. It happened after the Congressional Budget Office ran the numbers and ended up falling short of a trillion dollars in spending cuts. So, with time running out, he pulled the bill. He says he will revise it, and Republicans are now delaying a vote on the House floor.
Joining us is Congressman Jeff Flake. He's a Republican from Arizona who signed the cut, cap, and balance pledge and is not supporting the House speaker's bill. Hi there. Great to see you this morning, Congressman Flake.
REP. JEFF FLAKE, (R) ARIZONA: Hi. Thanks for having me on.
CHETRY: So, more than a dozen of you in the House say you will not support this bill put together by your own speaker. Why is that?
FLAKE: Well, I think we ought to, at least, have a bill that doesn't get us further down the road we don't need to get to. And this bill, if implemented, would cause us to go back to our own appropriations committee and plus up our spending for the current year by about $24 billion and that's just not right. I can't imagine trying to sell that.
CHETRY: Well, the speaker says that he's going to -- I mean, he's already pulled it. They're going to comb through it again. What if he can revise it to a trillion dollar in cuts? Are you on board?
FLAKE: Well, even the plan that where he said it was going to be 1.2, that still required about a $24 billion bump from our current budget upward. So, it would have to cut a little more significantly than that, I would assume. So, I would like to be able to support it. I'm not one of those who says that we don't have to raise the debt ceiling. We do.
But I'm worried about our credit rating as well. Even if we do raise the debt ceiling, unless, we have a credible plan in place to deal with our debt, we're going to get downgraded. And so, we got to take this a little more seriously.
CHETRY: Speaking of the downgrade and speaking of taking it seriously, I mean, if we continue to play chicken with this, if we continue to be, in some ways, de-righted by the rest of the world as we appear and not able to even compromise on this or any long-term spending, doesn't that also threaten the credit rating, the stellar credit rating we've enjoyed for almost a century?
FLAKE: Well, certainly, a default would. And I'm confident that we'll reach some agreement, but if I look at the agreement that was put forward yesterday, I think a straight no strings attached, just raise the debt ceiling for a short time to give us more time to work at this would be better than the agreement that was put forward yesterday.
CHETRY: Really?
FLAKE: As I mentioned, the agreement yesterday would actually cause us to go in in the House, because we never want to give the Senate more spending authority than we have. And it would cause us to actually increase our spending by $24 billion above the House passed budget this year.
CHETRY: Right. I just want to make sure I heard you correctly. You said that just a no strings attached yes to the debt ceiling would be better than your speaker's plan?
FLAKE: Well, I'm saying a short-term one. I'm not saying pass the elections like the president wants. We got to address the situation long before then. But, raising it -- without anything for a short time to give us time to negotiate this and get a better deal than we've gotten would be preferable than having a budget that actually or an agreement that actually requires us to increase spending.
CHETRY: You know, you talk about getting a better deal. According to an article in "Politico" this morning, it's pretty fascinating. Republican leadership in the Senate could be forced to take up and then actually pass this House plan. Then, it looks like, perhaps, some Republican leadership may be taking the chance that if they can get this bill in front of the president within a week of a possible default, he'd sign it. Wouldn't that be a huge victory for fiscal conservatives like you?
FLAKE: Well, I'm not so sure. I mean, basically, like I said the short-term cuts are not there, and we are basically punting to a commission to go ahead and do our work. And I think having the 17th commission -- we had 16, I believe, in the last couple of decades -- isn't going to calm the markets. They have a commission now.
CHETRY: At this point, no one is talking about tax hikes. I mean, these are all cuts whether it's the Reid plan or this one. What about compromise? You guys seem to be holding a lot of the cards and it seems to be a pretty good victory for fiscal conservatives.
FLAKE: We are talking about cuts, but, like I said the agreement we were offered yesterday would lead to an increase in spending in the current year. I can understand you have to phase this in and you may not see massive cuts in the first year. But having to go back and actually spend more this year, kind of a bank error in our favor, we are going to spend more, doesn't send the right signal to the markets nor to the country.
CHETRY: The other question about compromise. The Pugh Study out shows, this is the question that was asked you, said even if you share -- your lawmakers shares your view on this issue, what should your lawmaker do? And 68 percent said be willing to compromise. And when we talk about Republicans, 53 percent want some willingness to compromise. That's up 10 percent since April. So what are you willing to give in order to make sure that we don't default, that this does not happen to us, that we raise our debt ceiling by the deadline?
FLAKE: I would have liked to have seen a big deal, one that would lower the rates and broaden the base and actually deal with all sectors of this thing and to get some good tax reform as well. That would require a great deal of compromise.
I think a lot of us are willing to do that. But what we simply can't do is go backward here and actually spend more money in the short term than we are now. And I just don't think that that sends the right signal. I'm confident we can come to an agreement, but it has to be better than the one we were presented yesterday.
CHETRY: Congressman Jeff Flake with your take why you and as well as several of your people with you in Congress are not standing by the speaker's plan at this point. You'd like to see changes to it. Thanks for joining us this morning.
FLAKE: Thank you. Appreciate it.
ROMANS: He mentioned that AAA credit rating. The American dollar has always been seen as a safe haven to investors around the world, but that's not the case anymore, at least not right now.
VELSHI: Yes. In fact there are some investors who are looking for something a little bit more stable. Nina Dos Santos has been following this closely from London. All of the other things that are sort of peripheral to this debt negotiation that markets are looking at. Nina, what are you finding?
NINA DOS SANTOS, CNN INTERNATIONAL CORRESPONDENT: We should mention that the U.S. dollar has been steadily declining over the course of the last year. It's down 17 percent since this time last year against a basket of other currencies on the dollar index.
But what we have got at the moment is, of course, as all this talk about the debt debacle and the potential technical default for the United States, the world's largest economy, everybody it seems is heading for the hills so to speak, heading for those safe haven. Of course gold is the ultimate safe haven and it's now reaching further records in excess of $1,620 an ounce.
That means this precious metal is perhaps getting just a little bit too expensive for some people and they are also looking at to put their money into other safe currencies. The Swiss franc has been gaining speed right throughout the course of the last couple of months. It hit another record against the greenback just this week. And we've got some other surprising bright spots, such as, for instance, the Aussie dollar, the Australian dollar rising to a 30-year high this week against the U.S. dollar. It sounds great doesn't it if your currency is appreciating so much. But spare a thought for the Japanese yen, which is traditionally a very strong currency, Ali. It has continued to rise, and that makes Japanese exports like Toyota just a little bit less competitive because by the time they sell cars in the United States, repatriate the money, convert it dollars back into yen, surprise, surprise, they make a little bit less money every single time.
VELSHI: Nina, just let me ask you, because some people are floating the idea that the world's reserve currency, the U.S. dollar, might at risk in all of this. What are you hearing in Europe?
DOS SANTOS: It seems a little bit far-fetched according to the currency traders I've been speaking to. But the point is, Ali, is that even if we do get an 11th hour agreement to raise the debt ceiling, well, what the politicians will have to do is issue more U.S. treasuries. And given the fact that, obviously, foreign holders of U.S. debt have been having a white knuckle ride recently, it will be interesting to see what kind of appetite there is for that extra $1 trillion or $1.2 trillion they issue to raise that debt sealing when we do eventually get some kind of agreement, if, indeed, we get an agreement.
ROMANS: It's all just getting started. It really is.
VELSHI: White knuckle, it really is. Nina, thank you very much.
ROMANS: Have you heard this raise the debt ceiling rap?
VELSHI: This is great.
ROMANS: The comedian Remy released a video that's getting tens of thousands of hits on YouTube. Nothing like a little comedy in the face of a crisis, right?
(BEGIN VIDEO CLIP)
(RAPPING)
UNIDENTIFIED MALE: Raise the debt ceiling, raise the debt ceiling, raise the debt ceiling.
(END VIDEO CLIP)
(LAUGHTER)
ROMANS: It was a pretty good rap.
VELSHI: That was very good.
CHETRY: Perhaps you want to cut your own YouTube rap and send it to your elected leader. Either way, obviously people want to let their representatives know how they feel about this issue. VELSHI: They were jamming up the phone lines and Web sites. We would like to know what you would like to tell your elected representative. E-mail us, give us a tweet, tell us on Facebook and we are going to read some of your comments later in the show.
CHETRY: There's huge outrage this morning in New York and probably around the country after firefighters and police officers who worked at ground zero on September 11, a ruling came down they will not get their cancer treatments covered. Asthma is covered and post- traumatic stress, but why not cancer when so many have lost their lives or are trying to recover from cancer as they say were caused by ground zero. We will talk more about it. It's 36 minutes after the hour.
(COMMERCIAL BREAK)
CHETRY: They may have saved the school year in Memphis after all. You may remember last week we told you that the Memphis school board voted to delay the start of the year until the district gets $55 million, which is part of what the city owes them. Last night the board voted to start the school year as scheduled, August 8, as long as four conditions are met, which includes a payment of $12 million to cover the month of August.
ROMANS: Speaking of teachers, one in three Detroit teachers say they are under pressure from their bosses to cheat and change grades on state tests. This is according to a new "Detroit Free Press" survey. The paper did a survey after uncovering allegations of grade fixing in the city. And this comes as the fallout from Atlanta's cheating scandal continues. Investigators say there 80 percent of Atlanta schools fudged numbers to boost scores. I think "fudge" is too nice of a word.
VELSHI: They changed them.
ROMANS: They cheated.
VELSHI: Yes.
All right, when the nation's report card came out a pretty depressing stats. Kids don't know much, if all, about American history. They can recognize a guy like Abraham Lincoln, thankfully, but they're not entirely sure why. Jacob Soboroff goes into "Education Overtime" for us.
(BEGIN VIDEOTAPE)
SOBOROFF: Most of you know who this person is. But can you name two reasons he is important to American history? If not, you are in good company. A recent study called the nation's report card says fewer than a quarter of all students are proficient or show a solid economic performance in American history. Shocking, while most kids could identify a photo of Abraham Lincoln, hardly any could say why he was an important president.
Can you tell me who this president is right here? UNIDENTIFIED MALE: Abraham Lincoln.
SOBOROFF: First name?
UNIDENTIFIED MALE: Lincoln.
UNIDENTIFIED FEMALE: Abraham Lincoln.
SOBOROFF: And tell me, why was Lincoln an important president?
UNIDENTIFIED MALE: Because he was honest.
UNIDENTIFIED FEMALE: He did very important speeches.
UNIDENTIFIED MALE: I don't know this.
SOBOROFF: Both the study and my fieldtrip made it clear that kids aren't learning history. Why that is the case and how to fix it up for debate. Possibilities include apathetic students, how history is tested, and the No Child Left Behind act squeezing history out of the classroom in favor of math and reading.
When I went to see the guy in charge of the nation's report card he told me poor history scores are actually nothing new.
JACK BUCKLEY, COMMISSIONER, NATIONAL CENTER FOR EDUCATION STATISTICS: There is a core of kids who are outstanding. There's another small percent that our policymakers would probably call proficient. And then there's a big chunk of kids are below that line and that is not changed much.
WILL FITZHUGH, FOUNDER, "THE CONCORD REVIEW": We just got a pile of essays which I have to go through.
SOBOROFF: In Massachusetts, Will Fitzhugh publishes a journal is published highlighting the core group of gifted history students, and he thinks the history scores are troubling.
FITZHUGH: It's an old story. It's just that nobody is doing anything to fix it.
SOBOROFF: I tracked down some of the bright, young minds Fitzhugh's spotlights to ask what advice they would give to a struggling history student.
TIANHAO HE, HISTORY STUDENT: They really should try to find the fun. When it comes down to it, history is all about people like us who have shaped the course of this nation's history.
SOBOROFF: Maybe he is right. One option might be to keep reminding students the history is just that, all about people just like them. For "Education Overtime," I'm Jacob Soboroff.
(END VIDEOTAPE)
(COMMERCIAL BREAK) ROMANS: It's 44 minutes after the hour. Here are your morning headlines. An illegal immigrant from Uzbekistan charged with threatening to kill President Obama. Authorities say the 21-year-old suspect was arrested in Alabama after purchasing a machine gun and grenades from an undercover agent.
Today's key vote on House Speaker John Boehner's debt ceiling plan is being pushed back by at least a day. The bill has been losing conservative support after the Congressional Budget Office said it didn't cut as much as promised.
"The New York Times" reporting some flexibility perhaps on that August 2nd deadline. The paper reports higher than expected incoming taxes could allow the treasury to push the date back by a few days, perhaps as late as August 10th. But the underlying problems, of course, persist here.
Right now, U.S. stock futures trading low ahead of the opening bell. Investors worldwide watching Washington today, its news on the debt ceiling talks, the impasse there is so important. Investors are also sorting through a ton of corporate earnings coming out this morning.
A federal appeals court reversing course now saying that accused Tucson shooter Jared Lee Loughner can be forced to take anti-psychotic medication. The court cited his increasingly bizarre and suicidal behavior. That's why it's going back on its ruling that allowed Loughner to refuse these drugs.
A U.S. Olympic skier who won a silver medal at the 2010 Games is found dead in Utah. It's an apparent suicide. Police say Jeret "Speedy" Peterson called to tell them where he was before he shot himself to death on Monday night. Peterson battled alcoholism. He was arrested for drunk driving as recently as last Friday. He was just 29 years old.
Putting on the pads, training camp opens for ten NFL teams today including the Cowboys, the Patriots, the Eagles; this after the players and owners ended the lockout on Monday. The first pre-season games could be played on August 11th.
You're caught up on today's headlines. AMERICAN MORNING is back right after this break.
(COMMERCIAL BREAK)
CHETRY: Its 48 minutes past of the hour. A shot of New York City, a really beautiful morning actually; it's sunny and 73 degrees. A little bit later, it's going up to a high of 87. It should be a very pleasant day here.
Well, meantime, an atheist group is now suing over a cross that's scheduled to be displayed at the 9/11 Memorial and Museum in New York City. And this cross is made of two steel girders. It was found as is jotting out of the rubble at the World Trade Center site following the 9/11 attacks. The group American Atheist says that the cross display is a, quote, "Impermissible mingling of church and state".
Well there is a lot of outrage this morning. In fact, you can see it on the cover of some of the newspapers here in New York. "9/11 Outrage", "Go Die!" "Zadroga ruling tells cancer-stricken Ground Zero workers, go die". Well this is because of a new report finding not enough evidence to link cancer in 9/11 responders to the dust and smoke at the World Trade Center site and other areas where firefighters and police officers were working.
It means that those who worked at Ground Zero and places like landfills in Staten Island in the days following the 9/11 attacks will not have their cancer treatments covered as part of a government health program.
Our next guest called that decision an insult. John Feal was a demolition supervisor at Ground Zero. In fact, he lost part of his foot there. He has respiratory problems. And he has become a first responder advocate. Thanks so much for joining us this morning.
JOHN FEAL, FOUNDER, FEAL GOOD FOUNDATION: Thank you for having me.
CHETRY: You're part of the Feal Good Foundation. There is a lot of outrage this morning. How do you feel this morning, and what are your biggest concerns about this ruling?
FEAL: As a -- as a 9/11 responder, I'm insulted. As an advocate, I'm disappointed. I get about 200 or 300 e-mails a day on average. Last night I had 900 and I had about 300 phone calls. People crying, grown men, widows and those who have husbands that are sick and dying in the hospital right now of cancer.
This is -- this is utterly, utterly a slap in our face and its adding salt to a wound that hasn't closed in ten years.
CHETRY: And -- do you have any sense of why the ruling came down like this? I know that there are -- you say that you've gone to more than, what, 55 funerals?
FEAL: 53.
CHETRY: 53 funerals and those people --
(CROSSTALK)
FEAL: 51 -- 51 with cancer.
CHETRY: Cancer.
FEAL: Yes.
CHETRY: And these are people who had absolutely no signs of anything, any health problems before 9/11?
FEAL: No, ma'am. Never.
CHETRY: Why then was cancer excluded in this bill to help monitor, treat and compensate first responders?
FEAL: Well, they say that it's because there's no scientific evidence. And again, I don't need somebody with 12 years of college telling me that there is no evidence.
The -- the -- the deaths -- every time somebody dies CNN or somebody in the media covers these stories. That -- that -- the people that have passed away is enough proof already. We've had ten years of people getting sicker and dying. I don't need scientific research. The numbers are staggering.
CHETRY: Yes.
FEAL: It's alarming and they know that. Dr. Howard knows that. And let's not Bill and I -- make Dr. Howard out to be the --
(CROSSTALK)
CHETRY: This is the --
FEAL: Yes, Dr. Howard has been a champion and an ally to the 9/11 community but he also has bosses and he works with higher up. And I've got to believe that there's a reason why this hasn't been done but I -- I challenge the New York delegation to step-up their rhetoric and to -- to bring attention to this cause because for years we've advocated for the bill to get passed.
CHETRY: Right.
FEAL: And now we have advocate we have to advocate again to get this added to the bill. There's always obstacles and hurdles, this bill is not perfect but adding this bill -- adding cancer to this bill will surely help those who need it.
CHETRY: All right, so there is some hope in that. You said you need the delegation to be vocal.
FEAL: Sure.
CHETRY: I know that many of the elected leaders both on the senators and the congressmen and others have been really from New York have been trying to get this passed.
FEAL: Absolutely.
CHETRY: They said there was some political wrangling involved with the cancer diagnosis.
FEAL: Sure.
CHETRY: But the good news is they say they're going to revisit this in a few months and that perhaps by then they'll have the results or more results of some studies that have been done -- (CROSSTALK)
FEAL: Sure.
CHETRY: -- to sort of bolster the claim that yes cancer was caused.
FEAL: Yes, ma'am.
CHETRY: How hopeful are you this will happen quickly?
FEAL: I'm -- I'm confident cancer gets added to the bill. I bet my one kidney that I donated that it gets added. But we're not waiting a year. We want this done yesterday. And I'm asking the New York delegation to expedite these findings and get these doctors and scientists who are doing these studies now.
For them to come out on the wreckage, for them to come out in front of the camera and to say that 9/11 and this aftermath, the toxins created these cancers. If you took every toxin, one by one that was in the air at Ground Zero, individually you put it in a bottle, you've got a skull and cross bones on it.
Now you have a toxic soup. We had no hazmat suits, we had no proper respiratory, through the nose, through the mouth and through the skin it was absorbed and it's causing these blood cancers and these melanomas, these leukemias, these -- all of these cancers.
CHETRY: Right.
FEAL: Don't insult our intelligence. We're sick and dying but we're not stupid.
CHETRY: So let me ask you about that. There are some who say so now, why is -- why is this money needed? Is there not insurance for these people who went down there, firefighters, police officers and others who put their lives on the line. There is no insurance to help them pay for this and help compensate them?
FEAL: Cops and firefighters have a pension. Some of them are still fighting for their three-quarters and only getting half. They still have to pay out of pocket. Nine uniformed (INAUDIBLE) who lost their jobs because of their illnesses, lost their insurance.
The only place they can go is the Center of Excellence and if you can't be treated at the Center of Excellence, where else can you go? I have people call me every day for gas money to get to a doctor's appointment.
CHETRY: So this is why, you're saying this -- this compensation fund is so vital for some of the people that are fighting it again?
FEAL: Vital? It's a life line. They need it. And let's cut through it all. $2.7 billion in the compensation and $1.5 in the health care is not enough money to treat and compensate cancer. That is why I think this was said yesterday. CHETRY: All right. Well, we are going to have to see where this goes. They say they are going to revisit it and there could be a chance that they will add cancer to illnesses caused at Ground Zero --
FEAL: They will.
CHETRY: John Feal, I know you've been a tireless advocate for all of us, founder of the Feal Good foundation.
Thanks so much for joining us --
FEAL: Thank you for having me.
CHETRY: -- best of luck.
FEAL: God bless you.
CHETRY: Well, we're going to take a quick break. It's six minutes to the top of the hour.
We'll be right back.
(COMMERCIAL BREAK)
VELSHI: All right. Washington, D.C. it's fair and 84. Going up to sunny and 90 degrees today.
ROMANS: The boys of late night were laughing all the way to the bank about the debt talks. Let's listen.
(BEGIN VIDEO CLIP)
CONAN O'BRIEN, COMEDIAN: What are we even doing here having a show? Our country is in serious trouble. We are all here, yea, whoo.
UNIDENTIFIED MALE: It's fine. When China calls for their money, just say you're a roommate. It's what I always did.
O'BRIEN: The President spoke last night. You probably all saw his speech. Good. In his speech last night, President Obama said that compromise has become a dirty word. Yes. Then he told Republicans to go compromise themselves.
JON STEWART, COMEDIAN: The President was in full educator in chief mode.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: For the last decade, we spent more money than we take in. If we stay on the current path, our growing debt could cost us jobs and do serious damage to the economy.
STEWART: Oh? You know, I think your financial austerity path message may be slightly undercut by the be-goldened chair, the red carpet path. You walk down to tell us about it.
Isn't there any way to do the "tighten the belt" speech from a room that doesn't look like the foyer of the Vatican? I'm just saying if Willie Wonka had to address America's chocolate shortage, he might not do it from the waterfall room.
JAY LENO, COMEDIAN: Still no resolution to this stupid debt ceiling crisis thing. You know Iowa congressman Steven King says if President Obama allows the country to default he could be impeached. Of course, Obama could stop that with three words -- President Joe Biden.
Ok, ok, ok, ok. All right. Forget I said anything.
(END VIDEO CLIP)
ROMANS: The funniest stuff is from Jon Stewart. The banner: "The End of the World as We Owe It." I mean, that's funny.
VELSHI: I'm fascinated they can have so much fun with this. Like I didn't -- maybe I've just been doing this for too long to think -- I think it's sort of dull for people. These guys make it kind of funny.
CHETRY: That's right.
We went to see (INAUDIBLE) I think it said D.C. to states or federal government to states "Drop Debt" instead of "Drop Dead". At least somebody can laugh, right, Kyra Phillips as this drags on and on?
ROMANS: Good morning, Kyra.
KYRA PHILLIPS, CNN ANCHOR, "CNN NEWSROOM": All right. It is the top of the hour. Thank you so much.
