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CNN Saturday Morning News

U.S. Credit Rating Downgraded; Importance of a Credit Rating; Texas Governor Heads Day of Prayer; Lessons for Our Schools

Aired August 06, 2011 - 09:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

DEBORAH FEYERICK, CNN ANCHOR: Topping our news this hour, breaking news in Afghanistan. Afghan President Hamid Karzai says 31 U.S. troops died in a NATO helicopter crash today. A U.S. military official puts that numbers at more than two dozen.

Most if not all of those killed are believed to be Special Forces. The Taliban says insurgents brought down the helicopter with rocket-propelled grenades. NATO command has not confirmed the detail of the crash.

And this morning's other breaking news. America's credit rating takes a hit from Standard & Poor's. From AAA to AA plus. Standard & Poor's managing director explains how the downgrade could have been avoided.

(BEGIN VIDEO CLIP)

JOHN CHAMBERS, MANAGING DIRECTOR, STANDARD & POOR'S: I think it could have done a few things. I mean the first thing it could have done is to have raised the debt ceiling in a timely planner so that much of this debate had been avoided to begin with. As it had done, you know, 60 or 70 times since 1960 without that much debate.

So that's point number one. And point number two is it could have come up with a fiscal plan, you know, similar, for example to -- you know, the Bowles-Simpson commission which was bipartisan.

(END OF VIDEO CLIP)

FEYERICK: Well, we'll hear more from Mr. Chambers in just a few minutes.

And the Obama administration is firing back at Standard & Poor's decision. One senior official describes the downgrade as, quote, "a facts-be-damned decision," unquote.

CNN's Athena Jones is live in Washington.

And Athena, the White House particularly upset over an error it says inflated the U.S. deficit by $2 trillion. And that really is a big mistake.

ATHENA JONES, CNN CORRESPONDENT: Well, exactly. That's the point that they've made. They say that a $2 trillion mistake speaks for itself. And they argue that S&P has said that the debt deal that they reached last week with Congress wasn't big enough. We're talking about cutting about $917 billion right away and then $1.5 billion hopefully later through this joint committee.

And so if these numbers are fairly big, they argue the S&P this $2 trillion figure is also big. And so that's really the issue going forward. The White House officials say that right now two other ratings agencies, Fitch and Moody's, right now have still maintained the U.S.'s AAA credit rating and so right now it's just the S&P that's changed it.

But they believe this was a rush to judgment, that the analysis was made in haste. And so they have a big issue with it -- Deb.

FEYERICK: You know it really seems like a condemnation of how Congress behaved over the debt ceiling talks that it took months for them to put it together, that they waited until the 11th hour when everybody was almost in a sort of a fear mode.

Congress has to get back to work, but they're on vacation.

JONES: Well, absolutely. I mean, no matter how you look at it it's an indictment of Congress and of the kind of dysfunction in the S&P's view that we've seen over the last several weeks and months over this whole debt ceiling issue.

You know one of the issues that officials -- treasury officials, problems they had with this judgment, this downgrade, was that it was a political decision, not an economic one, as far as they're concerned. But certainly the politics matter. The S&P has said this whole issue of the debt ceiling and the threat of default have been used as a political bargaining chip.

And so they're not -- they're not optimistic that given what we've seen these last weeks in coming to this small deal which they say is not enough, given the problems we've seen reaching that deal, they're not optimistic that there's going to be big changes later when it comes to making real decisions on tax revenue, reform and entitlement reform.

And so that's where we stand right now -- Deb.

FEYERICK: All right. Athena Jones in Washington for us. Thank you so much.

And Standard & Poor's is one of the big three credit rating agencies as Athena mentioned.

Felicia Taylor joining us again this morning from New York.

And Felicia, there are two other ratings agencies, Moody's and Fitch. They still list the U.S. as AAA. So is there a balance there or do they now start thinking about whether they should downgrade?

FELICIA TAYLOR, CNN CORRESPONDENT: Well, the interesting thing about this is that the S&P actually came out and was looking for specific things to happen in that deficit deal structuring that happened in Washington. They didn't get what they wanted. Moody's and Fitch weren't as specific. S&P was looking for some $4 trillion in cuts. All we've got on the table right now is about $900 billion.

We've got that super committee that's meeting, that's going to come up with a bit more than that. But even still there -- I think there's about $2 trillion that might be on the table at some given point. That's half of what S&P was looking for.

So Moody's and Fitch were just not as specific as what they were looking for in terms of the ratings criteria. So that's what the difference is. I mean, it seems like a bit of a dichotomy to have on the one hand, you know, one person saying or one ratings agency saying it's AA plus where the other two were saying AAA.

But don't forget, Moody's and Fitch still said that we're on negative outlook so they could reassess that in the months to come.

FEYERICK: Do you think, Felicia, that in fact when the politicians get back to Washington, that in fact they are going to take that $4 trillion to heart and try to cut that? Are they going to use that as the gauge? Is the S&P sending a message, a signal, like this is what you got to do?

TAYLOR: I think the S&P is sending a very clear signal, there's no question about it, and, you know, whether or not they're able to achieve that $4 trillion mark, is certainly the elephant in the room.

I mean I don't know if they're going to be able to get that far. But definitely there's no question about it. I mean, Washington has had their wrist slapped. I mean they've definitely been told, listen, this isn't enough. You being the leaders in Washington, haven't come together to really cobble a program that's going to help save the economy in the United States.

There needs to be a lot more done. There needs to be more spending cuts and a lot less wrangling. So hopefully that message is now loud and clear. Whether or not they get to that $4 trillion mark, I don't know. But we're going to be in this position for some time to come. It's not just something that's going to change in a couple of months.

We're looking at probably 12 to 24 months, potentially where we're at this level of a reduced downgrade.

FEYERICK: Wow. All right, Felicia Taylor, thanks so much.

Certainly lawmakers are really going to have to get back and work it out regardless of what that takes to accomplish.

TAYLOR: Yes.

FEYERICK: All right, Felicia Taylor in New York, thank you so much.

And coming up at 7:00 Eastern tonight, CNN presents a special hour on the credit rating decision, the impact on you, your children, your future. That's tonight, 7:00 Eastern right here on CNN.

And Texas Governor Rick Perry, well, he's got his own way of dealing with the economic crisis. He's called for a day of prayer today in Houston. Thousands are expected to attend. The day-long service is causing a lot of controversy.

We're going to have a live report, that coming up right after the break.

REYNOLDS WOLF, CNN METEOROLOGIST: And as the sun continues to rise over parts of the southern plains, the temperature is going to follow with highs going up into the 100s again. Thirty-five days in a row, hard to believe.

Is there any relief in sight? We'll let you know.

I'm meteorologist Reynolds Wolf, and you're watching CNN SATURDAY.

(COMMERCIAL BREAK)

FEYERICK: And it's time now to go "Cross Country" for stories our CNN affiliates are covering.

First up, Orlando, Florida.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: At the post office some guy flung the door open, real violently and fast, and screamed, oh, my god, is that Casey Anthony, and waited for me.

(END OF VIDEO CLIP)

FEYERICK: Now that woman is getting hounded because she looks a lot like Casey Anthony. Anthony was acquitted of murdering her 2- year-old daughter in one of the most closely watched legal cases in decades.

And in Charlotte, North Carolina, a hotel lobby just drowning in water. The heavy rain pooled on the roof and began pouring through light fixtures in the lobby in Embassy Suites. Parts of three interstate highways in Charlotte had to be closed because of the heavy rain.

And take a look at these pictures of the bank robbery in Valdosta, Georgia. Police say they're actually a sister and two brothers who shot at a police officer just hours earlier in Tampa during a traffic stop.

And today in Texas, Reliant Stadium in Houston will become a huge house of worship. Texas Governor Rick Perry has called for a day of prayer. The service puts the undeclared GOP presidential candidate in the spotlight.

Here's CNN's Jim Acosta. (BEGIN VIDEO CLIP)

GOV. RICK PERRY (R), TEXAS: This is Governor Rick Perry.

JIM ACOSTA, CNN POLITICAL CORRESPONDENT (voice-over): A Texas governor who says he feels call to run for president, Rick Perry has issued a call of his own for people across the country to fill this stadium in Houston this weekend to pray for what organizers believe is a nation in crisis.

PERRY: With the economy in trouble, communities in crisis, and people adrift in a sea of moral relativism, we need God's help. That's why I'm calling on Americans to pray and fast like Jesus did.

ACOSTA: Organizers hope the event, dubbed "The Response," will kick start a sluggish economy to pray away the malaise. But critics argue Perry's leadership role as an initiator of a gathering featuring a Christian-online lineup tears down the walls separating church and state.

BARRY LYNN, AMERICAN UNITED FOR SEPARATION OF CHURCH AND STATE: Many people love a little slogan down in Texas called "Don't Mess with Texas." It was a very effective campaign.

I'd say to the governor, don't mess with the Constitution.

ACOSTA: But Perry is up front about his Christian faith. The governor called for days of prayer earlier this year to end the drought in Texas and he once told a televangelist he believes the recession serves a higher purpose.

PERRY: I think we're going through those difficult economic times for a purpose in that -- to bring us back to those biblical principles.

ACOSTA: Questions are also being raised about statements made by some response planners and official endorsers. A spokesman for one key organizer, the American Family Association, has compared gay rights activists to Nazis.

BRYAN FISCHER, AMERICAN FAMILY ASSOCIATION: If you have religious views about homosexual behavior you are squashed. I mean, ladies and gentlemen, they are Nazis. Homosexual activists, when it comes to freedom of speech, are Nazis. When it comes to freedom of religion they are Nazis.

ACOSTA: Doug Stringer, the national mobilization coordinator for the Response, defends the governor's handling of the event.

(On camera): The governor is holding a Christian event.

REV. DOUG STRINGER, RESPONSE: Now the governor is not holding the event.

ACOSTA: He's the initiator according to the Web site. STRINGER: He trumpeted and made a declaration that we need a day of fasting and prayer and asked the church to respond to that. The church is doing what we should be doing anyway, responding to that trumpet call.

ACOSTA (voice-over): A call that could work with a key Republican voting bloc, Christian conservatives, a trick for Perry is what happens if he wins the GOP nomination.

BILL MARTIN, RICE UNIVERSITY: Having an event like this will be brought up again and again by his opponents to say, Governor Perry does not represent the separation of church and state.

(END VIDEOTAPE)

ACOSTA: And the other big question for the Response is the response. So far only 8,000 people, according to organizers, have registered online to attend this event. This is a venue that holds more than 70,000.

The governor has also invited governors around the country to come to Houston for today's day of prayer. But only one Republican -- Sam Brownback of Kansas -- has said he will be here today and he's on the schedule.

And Deb, I can tell you that Rick Perry is scheduled to speak in a few hours from now. His aides are very tight lipped about exactly what he might say -- Deb.

FEYERICK: Interesting. All right. Jim Acosta, thanks so much. It will be interesting to see whether it's a religious event or ends up as a political event.

Jim Acosta, we're going to check in with you. Thanks so much.

Well, Reynolds Wolf up next with yet another sizzling forecast. And later, educators with a lesson plan. Thousands of teachers march on Washington. We're going to tell you why.

(COMMERCIAL BREAK)

FEYERICK: And Reynolds Wolf joining us now.

And you know that the country is in trouble when the map matches the color of my dress.

WOLF: Absolutely.

FEYERICK: Like there's no coolness on this map right here.

WOLF: Well, maybe you should wear blue.

FEYERICK: You know, I -- you're carrying the torch for the blues. So you're right.

WOLF: Yes, maybe we can paint this cooler temperature because we need it.

(WEATHER REPORT)

WOLF: That's a look at your forecast, Deb. Let's pitch it right back to you.

FEYERICK: Thanks so much, Reynolds.

Well, thousands of teachers march on Washington. We'll tell -- they're going to tell us why they're upset. And that's coming up right after this.

(COMMERCIAL BREAK)

FEYERICK: Well, the school year is starting with a lot of heated debate over education reform in America. Part of that played -- that debate played out with a protest in Washington.

Our education overtime guest correspondent Sam Chaltain was there.

(BEGIN VIDEOTAPE)

SAM CHALTAIN, CNN GUEST CORRESPONDENT (voice-over): What will it take to transform public education?

UNIDENTIFIED FEMALE: Are you hot and mad today?

CROWD: Yes.

CHALTAIN: Is it anger and bullhorns?

UNIDENTIFIED MALE: Show me what democracy looks like.

CHALTAIN: Clever posters and language? Or will it take me beat boxing to the words of the notorious Ph.D.

MARK NAISON, PROFESSOR, NY FORDHAM UNIVERSITY: They've exported our jobs, treated us like fools, now they're working hard to take over our schools.

CHALTAIN: Thousands of teachers, students and parents from across the country were here to tell President Obama that his current reform policies are definitely not the change they seek.

(On camera): Why did you decide to come to D.C.?

NAISON: I am so disturbed that teachers are being made to blame for our society's problems.

UNIDENTIFIED FEMALE: This privatization model is a some-children approach to a public education reform. What we need is an all- children approach.

CHALTAIN (voice-over): But if the march is to save our schools from the policies of the Obama administration, what should we be doing instead?

Renee Moore is the national board certified teacher from the Mississippi Delta and a former teacher of the year.

RENEE MOORE, 2001 MISSISSIPPI TEACHER OF THE YEAR: Teachers, particularly our best teachers, have been largely left out of the conversation in terms of the actual implementation and establishment of these policies.

CHALTAIN: Among those policies none is less popular than the use of high stakes tests to determine which schools and teachers are successful. Indeed under current policy as many as 82 percent of our nation's schools could be labeled as failing this year.

The rally's headliner, NYU education historian Diane Ravitch says President Obama's "Race to the Top" policy punishes teachers even more.

DIANE RAVITCH, NYU PROFESSOR OF EDUCATION: The basic idea of federal aid to education is equity. It's putting the money where the poorest kids are, not sending the money to the state that has the best grant proposal.

CHALTAIN: Clearly among the marchers there are real challenges going forward and broad coalitions that need to be built.

ANGELA VALENZUELA, DIRECTOR, UNIVERSITY OF TEXAS CENTER FOR EDUCATION POLICY: We're going to be talking very seriously about English language learners, that segment of the population that is growing at the biggest rate in our public school system, then we really need to be focusing on this community in a holistic way, not a way that reduces them to their language.

CHALTAIN: Everyone I spoke with agreed that lasting change will take much more than rallies and rhetoric. But they also felt that the first step was to make themselves loudly, undeniably visible and to demand their rightful seat at the table before it's too late.

(END VIDEOTAPE)

FEYERICK: And guest correspondent Sam Chaltain joins us now live from Washington.

Hey there, Sam. You know you're a former educator yourself. What was your reaction to this school's rally? Did it accomplish anything or was it just trying to get the mood up?

CHALTAIN: So, first of all, thanks and good morning. Thanks for having me.

FEYERICK: Of course.

CHALTAIN: I think it was a really important step towards greater activism and involvement on the part of teachers. You know as a former educator myself I think there's been a tendency among many of us who have been frustrated with the current pace of reform to be too passive to kind of blame others and say, look at what they've done to us.

But what this march seems to me to have symbolized was that teachers across the country are starting to say, we're ready to take back our profession, we're ready to demand our rightful seat at the table, and we want to play an active role in determining where we go from here.

FEYERICK: You know, and that's what's so interesting also. The teachers, they want to be involved in education process. Creating programs and classes specific to the needs of their schools. Standardized testing, that is one of the critical issue because many of them can't do that.

CHALTAIN: Yes. I mean just to clarify for the viewers, so under "No Child Left Behind" what's happened is students in third through eighth grade and then once in high school are tested in only two subjects, reading and math. And these are basic skills standardized tests. Obviously everybody would agree that's an important barometer. We need to make sure that basic literacy and numeracy is acquired by our kids.

What's happened in practice is two things. First of all in some schools, it's business as usual. And actually the most recent international test, the PISA test, students that attended low poverty schools actually ranked first in the world in those subjects.

Students in schools where even a quarter of the students were living in poverty still tied with Finland and South Korea for tops in the world. So clearly "No Child Left Behind" is not dramatically influencing those communities.

FEYERICK: Right.

CHALTAIN: The problem is that in schools with high poverty kids who, because of a variety of circumstances, are likely to be further behind in basic skills and some of the other things that put us in a position to be ready to learn.

FEYERICK: Right.

CHALTAIN: The existence of a single metric to determine whether those kids, whether those teachers and whether that school are being successful is what's resulted --

FEYERICK: And that's really the danger.

CHALTAIN: That's right.

FEYERICK: And that's really the danger, is that take the emphasis away from learning and you put it on testing.

All right, Sam Chaltain, thanks so much. Great piece there and I really like that rap. We'll be back.

CHALTAIN: OK. Great. Thank you very much.

(COMMERCIAL BREAK)

FEYERICK: Lot more coming up at 10:00, but right now, "YOUR BOTTOM LINE" straight ahead.