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.
JUDY WOODRUFF, CNN ANCHOR: As we saw when the markets closed at the top of this hour, investors have been shaken by recent events, especially when it come to the nation's travel industry. Brooks Jackson has more on the economy and the ripple effects caused by last week's attacks.
BROOKS JACKSON, CNN CORRESPONDENT (voice-over): Empty hotel rooms, empty convention centers, empty taxi cabs and limousines; unemployment offices, overflowing.
UNIDENTIFIED MALE: I'm unemployed, due to the attack on the America.
JACKSON: Economic aftershocks from last week's attacks are ravaging the business travel industry, hitting upscale hotels. Washington's Ritz-Carlton, normally $450 a night, cut rates to $119 for government travelers and their families, and still expects to be less than half full.
UNIDENTIFIED MALE: It's cost us in the region of $2 million.
JACKSON: To keep busy and maybe drum up business, the pastry chef is making cookies and pies for idle bellmen to carry as gifts to key clients.
The slump is also hitting budget hotels. Some Best Western hotels lost half their reservations last week. Calls to the chain's central reservation number are down 20 percent. Hitting everywhere, the big Hilton chain normally gets 2/3 of its business from convention and business travelers, and says the next few weeks may be its worst ever. It's hitting stockholders. Hilton's stock has plunged 40 percent. And it's also hitting cab drivers.
UNIDENTIFIED MALE: I've been here since 9:00 and I didn't pick up nobody.
JACKSON: And that was just after noon.
At Washington's Grand Hyatt, desk clerks are out of work because so many business meetings were canceled.
KIM BRAGG, FRONT DESK AGENT: Everybody at the front desk got laid off. So everybody is laid off at the front desk, except for the managers.
JACKSON: Boston has lost three citywide conventions that would have brought in 15,000 visitors, and an estimated $15 million to the city.
LARRY MEEHAN, BOSTON TOURISM OFFICIAL: It's everything from the restaurants to the tour companies, the taxi cabs. Literally, every kind of business that you find in America is some way affected by travel.
JACKSON: Hotels had record profits last, so they're not hurting as much as the airlines are now.
SEAN HENNESSEY, PRINCEWATERHOUSECOOPERS: The industry will still be profitable this year. It will just be the first time in a number of years that the profit level for the industry has gone down.
JACKSON: Still, the lost travel business is costing untold millions of dollars, and thousands of jobs.
Travel industry executives say they hope for a return to normal by next year. But there are no real precedents to guide them, so forecasts are just guesswork.
Brooks Jackson, CNN, Washington.
WOODRUFF: And, as if that's not bad enough, the grim news for airline employees continues to pour in. Today, Northwest announced that it will cut 10,000 jobs and reduce its flight schedule by 20 percent.
CNN's Jonathan Karl standing by on Capitol Hill with the latest on what's happening in the Congress, Jonathan, to help the airline industry?
JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: Well, Congress moving full speed ahead towards votes in both the House and the Senate on this airline bailout package. But as they do so, several key members of Congress are stepping forward to say, hey, we can bail out the airline industry, but it won't mean much until people feel safe to fly again. Several senators have stepped forward in the last hour to say that Congress must move with equal haste to pass an airline security bill.
(BEGIN VIDEO CLIP)
SEN. ERNEST HOLLINGS (D), SOUTH CAROLINA: We can give the industry billions upon billions in the next 10 minutes. But the sustenance and success and the resumption, more or less, of airline travel will never occur until the traveling public is confident of safety and security at the airports and on the planes in America.
KARL: And those billions and billions are headed towards the airline industry. That bill -- this is how it looks right now. We talked about the $5 billion in direct cash payments to the industry, another $10 billion in loan guarantees.
There's also in here a victim's compensation fund, a fund that would be administered by a special master appointed by the attorney general. That person would be told to give victims -- to rule on questions of how much a victim would be entitled to within 120 days, and send the money out 20 days after a decision is made. If a victim were to not go along with that, they could sue in court. But those lawsuits would be limited to the amount of liability, the amount of insurance that those airlines have.
There's also a question of executive compensation, which very interestingly, this bill looks like will cap executive compensation for executives in the airline industry, saying that they would not be entitled to any extra raises over the next two years, should they agree to accept the money that is in this bill.
Now, Republicans are worried about the cost of this, but seem to be going along anyway. Democrats very concerned that there is nothing in here -- you mentioned the people that were just about to be laid off by Northwest Airlines -- nothing in here to help the 100,000 or so people who will be laid off by the airline industry.
Senator Ted Kennedy wanted to see that included in this bill too. He is moving forward, would like to see something soon, perhaps by next week, that provide assistance to those laid off and displaced workers in the airline industry, providing them health care coverage, perhaps job retraining, and also adequate unemployment compensation. So that's the way it looks now, Judy.
WOODRUFF: All right, Jonathan Karl, watching the activity at the Capitol, thanks -- Joie.
JOIE CHEN, CNN ANCHOR: Judy, of course, the president has warned against it, but last week's attacks have led to a spike in reports of discrimination against Muslims and Arab Americans. In at least five incidents this week, Arab men were removed from domestic flights because passengers or crews did not want them aboard.
One example just yesterday in Minneapolis: three men were not allowed to board a Northwest airlines plane bound for Salt Lake City, because other passengers refused to fly with them. One of the men, who did not give his name, described what happened.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: The men just come up to us, say we cannot take you in the airplane, because the customers refuse to go on the airplane if you go.
UNIDENTIFIED MALE: Because they were scared of you?
UNIDENTIFIED MALE: That's right. I was Arab-American.
(END VIDEO CLIP)
CHEN: The men's luggage was searched and re-searched, but nothing suspicious was found. The three men were then booked on a Delta flight to Salt Lake City -- Judy.
WOODRUFF: Joie, this has to be very tough times for the vast majority of Arab-Americans.
In his speech last night, the president tried to make clear that the United States is at war with terrorist, and not at war with Islam. And he made a religious distinction about who America holds responsible.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Terrorists are traitors to their own faith, trying, in effect, to hijack Islam itself. The enemy of America is not our many Muslim friends. It is not our many Arab friends. Our enemy is a radical network of terrorists, and every government that supports them.
(END VIDEO CLIP)
WOODRUFF: CNN's Bill Schneider joins me now with more on how public attitudes towards Muslims and Arab-Americans have changed, Bill, and also, attitudes toward Israel.
First of all, what are the latest polls showing?
BILL SCHNEIDER, CNN SR. POLITICAL ANALYST: Well, Judy, as you may know, it's always hard to get people to admit prejudice in a poll. But about 1/3 of Americans tell us that they have heard other people making negative comments about Arabs living in this country.
Now, President Bush says we are at war. Now, keep that in mind as I report these results. Fifty-eight percent of Americans believe Arabs, including those who are U.S. citizens, should be required to undergo special, more intensive security checks before they can board an airplane. And nearly half endorse the idea that Arabs, including those who are U.S. citizens, should be required to carry special identification. Those are certainly troubling answers, but in the back of their minds, people are thinking, "there's a war on."
WOODRUFF: So, clearly evidence of discrimination, Bill. Could this spill over and affect the war effort?
SCHNEIDER: Well, Judy, listen to what King Abdullah of Jordan, who is a strong ally of the United States -- listen to what he told "The New York Times." Quote -- "The terrorists actually want to provoke attacks on Arabs and Muslims in the U.S., because then you destroy the special thing that America stands for. That's what the terrorists want."
Now, President Bush clearly got that message, which is why he spent a good part of his speech separating the terrorists from the Islamic faith, and arguing that the principles we are fighting for include fairness and tolerance.
WOODRUFF: And, Bill, what about Israel? What are the polls showing, in terms of attitudes toward America's long-term ally? SCHNEIDER: Well, sympathy for Israel has had a big increase since the terrorist attacks. Last month, 41 percent of Americans said they sympathize with Israel over the Palestinians in the Middle East conflict. That number has now jumped to 55 percent.
But I also noticed something else in the polls: the more worried you are about terrorism in this country, the less sympathetic you are to Israel. Support for Israel is lowest among Americans who say they are very worried about becoming the victim of a terrorist attack, and to those who do not have much confidence that the U.S. government can protect them against terrorism.
So why did support for Israel go up? Because not very many Americans right now say that they are worried about personally becoming the victim of a terrorist attack, and they feel as if the government can protect them. But if that feeling of vulnerability increases, it could have all kinds of consequences, for civil liberties in this country and for America's role in the Middle East.
WOODRUFF: I think it's kind of remarkable that so many people feel so safe after what happened.
SCHNEIDER: They do. They're saying that personally they feel safe. They expect further terrorist attacks, but when we say, personally, do you feel safe, an overwhelming majority of Americans still say they do.
WOODRUFF: It's going to be somewhere else.
SCHNEIDER: That's right.
WOODRUFF: They hope. We all hope.
WOODRUFF: All right, Bill Schneider. Thanks.
WOODRUFF: And coming up next, journalists weigh in on President Bush's speech to Congress and the nation, and what comes next in the war against terrorism, when we come right back.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: This is a huge, void space. It's all wide open underneath here. We came across this. We put a camera in and we found somebody walking around, and got all excited. Turned out to be another USAR guy. There's a void in that comes in here, comes in over there, and you get in underneath here. We're on top of the mezzanine. I looked at the earlier pictures and recognized this globe, and we're underneath the concourse mezzanine area.
So right now, our operation is to clear as much of this debris off so we choke as much of this structural stuff and get it out of here, for right now, so we can open this up.
(END VIDEO CLIP)
WOODRUFF: One of New York's firefighters. What a heartbreak it must be for those men and women working there. You heard him say, for a moment they had a hope that the person they saw down below was somebody who had survived, but then they realized it was another rescue worker. But they have to keep hoping.
Well, the overwhelmingly positive reception for President Bush's speech to Congress last night is mirrored in many newspaper editorials today. From "The New York Times," quoting, "in a firm and forceful address, Mr. Bush rose to the challenge of making what may be the most critical speech of his life."
A "USA Today" editorial praised Mr. Bush's speech, but urged him to focus more on the economic fallout from last week's terror attacks. Quoting now: "The patience and mounting war must be balanced by greater urgency in protecting prosperity at home."
Let's talk more about the speech and the week with John Harris of "The Washington Post," Cynthia Tucker of "The Atlanta Constitution," and our own senior analyst, Jeff Greenfield.
Jeff, I'm going to start with you. Just about everybody is giving the president a thumbs up, saying he more than rose to the occasion last night. In your mind, specifically, why was this speech so successful?
JEFF GREENFIELD, CNN SR. ANALYST: Well, for one thing, everybody wanted it to be. It's not like a partisan issue where people are going to jump on the president for saying things they didn't agree with. And I love the fact that "The New York Times," in what must be a record of over-restraints, that it "may" be the most critical speech his life, like, as opposed to what? But that's why the speech, in part, succeeded.
It also succeeded because it was a really brilliant speech. It reached deep back into the history of other critical speeches made by people like Lincoln and Roosevelt and Churchill. Whatever doubts people had about the president's bearing in times past are gone. And I think, as I said to you last night, the speech and the man met the moment.
The country wanted it to work, they wanted to hear simultaneous words of reassurance, confidence, grief, restraint, with respect to the Muslim world, and forcefulness with respect to our adversaries. They got everything they wanted in a very, very well-crafted package.
WOODRUFF: Cynthia, from your perspective, was the president helped because of what Jeff was mentioning, that, in some ways, expectations were not as high, this president, perhaps, has not always been as eloquent as some presidents. Was he helped by that fact?
CYNTHIA TUCKER, "ATLANTA CONSTITUTION": Well, I think the president has to be given a lot of credit in this case, Judy. I'm one of those people who does not have very high expectations for the president, and I was willing to give him credit for just coming out of the speech barely adequate.
But the simple fact of the matter was, I found it stirring -- moving in places, sometimes I was moved to tears. And so I think the speech was very well written, I think it was very well delivered,0 and it was also pitch-perfect. When the president is ad-libbing, as he has -- sometimes in the past week, he has unfortunately sometimes sounded rhetorical sour notes, as when he referred to Osama bin Laden as being wanted, "dead or alive," or when he referred to the campaign against terrorism as a crusade.
But this speech was pitch-perfect. And it hit all the right notes, especially in its reassurance of our allies, and in its outreach to the Muslim world.
WOODRUFF: John Harris, you said, in talking to us and my colleagues at CNN about the speech, that it underscored how obsolete the old agendas are. What did you mean by that?
John Harris? Are you there, at "The Washington Post"? Can you hear me, John?
JOHN HARRIS, "WASHINGTON POST": I can hear you. Apparently, you can't hear me.
HARRIS: OK, is that better?
WOODRUFF: Yes, now I can hear you.
HARRIS: I heard your question, and my point, when speaking earlier with you, was that George Bush ran as the descendant, essentially, ideologically, of Ronald Reagan. He's a conservative, authentically a conservative.
But under the circumstances, in the environment of crisis, the things that are the pillars of the conservative agenda are obsolete. You know, nobody is talking about decentralized government right now. It's clear that government needs vasted authority to deal with this crisis. He promised to spend billions to rebuild New York. Rather than letting free markets work by themselves, he said it's an emergency, that we subsidize the airlines to rescue what would be potential market failures.
So I think it's -- all the old ideological arguments that have sort of animated our politics in recent decades are really obsolete, and I think that was a subtext of that. That speech was more the descendant of Franklin Roosevelt than it was, sort of in the legacy of Ronald Reagan, I thought.
WOODRUFF: Jeff, does it only get tougher from here on out, to keep Americans support, or will people stay with the president through almost anything now? GREENFIELD: Well, if I knew what was going to happen in the next six months or a year, I think I could answer that question. There is an unsettling fact about Americans, that for the last period of time, the last two wars, we have fought until the Gulf war, Korea and Vietnam, protracted war, war without a clear, absolute march to victory, has produced division in the country -- "why are we fighting this?" It happened to Harry Truman, it happened to Lyndon Johnson.
I do think what makes this one different, and what makes some historical parallels tricky, is that we have never faced a situation where the homeland has been hit to this extent. Not only the homeland, but the heart of the financial and cultural country. So that it may well be that because of the gravity of this, that people are going to -- and because the president was, I thought, very clear in spelling out that this was not going to be some kind of panorama to a quick victory, I think he has earned from the public more patience than other presidents have gotten from the public when they've had a fight on for a long period of time.
WOODRUFF: Cynthia, to you just quickly, on the economy. People in the Atlanta area, others you're talking to, are they prepared for what we're facing when it comes to a rough -- a rough ride?
TUCKER: No, Judy, quite frankly, I think that none of us are prepared. As Jeff just said, none of us really know what's coming. And after all, over the last decade, Americans have gotten pretty comfortable with high levels of prosperity. And so, in a very real sense, I think the test of the president's leadership has just begun. He's going to have to come back to us time and time and time again, and counsel patients, and remind us that sacrifice will be necessary, not just only from our soldiers, but here on the home front as well. We may have to sacrifice some comfort and convenience, and even a little of our affluence.
WOODRUFF: And, John Harris, just quickly, when it comes to the economy, is there one thing the president could do to reassure people?
HARRIS: I think that speech went a long way, that the problem is going to be solved, and that he's alert to both the international threat of terrorism and the considerable domestic peril. If throwing money at the problem will work, I think people in both parties are clearly indicated that they're prepared to do that. They've already appropriated $40 billion, and are prepared to spend more.
So if that's going to work, I think we're OK. If it doesn't, then we're facing a whole new situation.
WOODRUFF: All right, John Harris at "The Washington Post," Cynthia Tucker of the "Atlanta Journal Constitution" and our own Jeff Greenfield in New York.
When we come back, the entertainment industry comes together to support the recovery. The stars come out, next.
(COMMERCIAL BREAK) CHEN: Just like people all across the country, the stars of the entertainment industry want to do something to help the victims of last week's terror attacks. So Billy Joel, Tom Cruise, Tom Hanks and many other celebrities are planning to take part in a telethon tonight. It will air on 31 broadcast and cable networks nationwide, and be beamed to 156 countries all around the world. The two-hour benefit, "America: A Tribute to Heroes," begins at 9:00 Eastern tonight.
And tonight's baseball game at Shea Stadium will be the first regular sports event in New York since last week's attacks. The Mets and the Braves take the field in just a couple of hours. Mets players say they will donate their salaries for this game to a charity for families of emergency workers. And ceremonies are planned, featuring Diana Ross and Liza Minelli, among others.
Last night in Philadelphia, a preseason hockey game between the Flyers and New York Rangers was declared a tie after two periods -- get this -- because fans demanded that the president's speech be played on the arena video screen. The speech was about to begin as the second intermission ended, and the fans booed until the speech was returned to the screen. When the speech was over, the two teams lined up to shake hands on the ice, and the game was declared a draw, Judy. Quite an incredible story.
WOODRUFF: That is just remarkable.
Outside of New York, no group of athletes more affected by the attacks and the possible military response than those at the nation's military academies. CNN/Sports Illustrated's Bob Lorenz spoke with some of the football players for Army and Navy about the attacks, their role as athletes and their futures.
BOB LORENZ, CNNSI (voice-over): Reminders of the world's fragile presence hang constantly overhead, impossible to ignore. Just like the longstanding monuments to troubles past. The young men and women who attend the nation's service academies are never far from the subject of war. They study it, they prepare for it. But few of them ever believed they would face it so soon.
OMARI THOMPSON, ARMY RECEIVER: We've definitely been trained for opportunities such as this, but, you know, this is definitely something for us to deal with. You know, we've had to console one another and talk to one another about, you know, what we could be getting into. And you know, are we really going to be ready? A lot of us have to ask ourselves that.
JAKE BOWEN, NAVY LINEBACKER: It's something that we live with, but we knew that when we came here. And I have the utmost respect for every one of our players, you know, that have made a commitment to serve their country.
CHAD JENKINS, ARMY QUARTERBACK: When I came in as a freshman, there was no really world conflict going on, and now, all of a sudden, I mean, it's right around the corner. I mean, I'm graduating here in June, and so it really hits home.
LORENZ: Home to these football players has changed dramatically since the September 11th terrorist attacks. The cadets at the United States Military Academy at West Point have been under lockdown, unable to leave their campus. And since the day after, the U.S. Naval Academy has been under heightened security.
BOWEN: You go to the gates and you see the Marines with their -- you know, their machine guns, and it almost looked like it was the front line.
THOMPSON: It's really hard to not feel the overwhelming sense of duty and sense of patriotism that you have. You have to take care of your nation's problems.
LORENZ: As they prepared for their return to the football field, the risks of an impending war were not lost on these players.
JENKINS: I heard one of my classmates say the other day, "Wow, in 10 years! I mean, how many classmates will come back for 10-year reunion?"
UNIDENTIFIED MALE: There's a good chance that, you know, one of my teammates, one of my shipmates back in the hall could, you know, go out there and possibly give their life for this country.
LORENZ: For now, they represent their universities, and suddenly, these often overlooked football programs will have the nation's attention.
TODD BERRY, ARMY COACH: We're America's team, possibly, right now, in their eyes, and there is more pressure to win because of that.
THOMPSON: America wants to see us win, they want to see our nation win, they want to see, you know, their team win. We've really got to go win now. We've got to show this nation that, you know, we're on top of things and that we're going to come out on top.
LORENZ: I'm Bob Lorenz.
WOODRUFF: Some very courageous and inspiring young men.
Well, I'm Judy Woodruff signing off for now. Our coverage of "America's New War" continues after this.
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