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Did Voters Hear What They Needed From Democrats? What Will They Hear When Republicans Take the Stage?; Where Are Oil and Gas Prices Headed to With Two Storms in the Gulf?; Are Americans Better Off Now Than in 2001?
Aired August 30, 2008 - 13:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD LUI, CNN ANCHOR: All right, YOUR MONEY is next. First, though, this check of our top our top stories for you.
Evacuations are beginning along the U.S. Gulf Coast. Forecasters saying, hurricane Gustav could hit the U.S. Mainland late Monday or early Tuesday anywhere from Galveston, Texas, to Mobile, Alabama. Right now, most of the evacuations are voluntary.
Gustav is now a category 3 hurricane with topped sustained winds of 125 miles per hour. It's getting closer to the western tip of Cuba, where more than 200,000 people have been evacuated.
A memorial service in Cleveland today for Ohio's first black congresswoman. U.S. Representative Stephanie Tubbs Jones died last week after suffering a brain hemorrhage. Among the speakers at today's memorial Democratic presidential candidate Barack Obama and Senator Hillary Clinton.
One day after introducing Alaska Governor Sarah Palin as his vice presidential running mate, Republican John McCain is campaigning with her today. McCain and Palin will appear together at a rally in Washington, Pennsylvania.
And a major earthquake in southwest China today. A 6.1 magnitude tremor in Sichuan Province. State media reports three people have died. That same area was hit by a massive quake last May. It left 70,000 dead.
And now some pictures of the first Amtrak train that left New Orleans. This, as evacuations begin today. We'll be staying on top of course all of the latest there in the Gulf Coast as hurricane Gustav makes its way towards that area. We'll update your top stories at the bottom of the hour.
And now, it's time for YOUR MONEY.
CHRISTINE ROMANS, CNN HOST: Welcome to YOUR MONEY, where we look at how the news of the week affects your bottom line. I'm Christine Romans.
Coming up on today's program, did voters hear what they needed to from the Democrats? And will they get what they want when the Republicans take the stage? We'll hear from the left and the right. Also ahead, with two major storms brewing in the Gulf, we'll tell you where oil and gas prices could be headed and how high fuel prices are playing into this election.
And America's economic temperature, it's been seven years since the last recession. We'll tell you if Americans are better off now than they were in 2001.
But first it was a big week in politics, just after the Democratic National Convention wrapped up; John McCain announced who would run alongside him for Republicans.
CNN's Allan Chernoff has more on the big announcement.
ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT (voice over): Governor Sarah Palin took on the oil giants who are essential to Alaska's economy leading a push to raise taxes on big oil. Now Alaskans will be getting a share of the revenue, $1,200 for each qualifying resident.
GOV. SARAH PALIN (R), ALASKA: I sent a large share of that revenue directly back to the people of Alaska.
CHERNOFF: Governor Palin has also just signed legislation that will suspend for a year, Alaska's 8 cent-a-gallon gasoline tax. John McCain called for suspending the federal gas tax this past summer. The Palin Administration has also pushed through a long debated plan to build a natural gas pipeline that could supply the lower 48 states.
PALIN: We're now embarking on a $40 billion natural gas pipeline to help lead America to energy independences.
SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: She will connect immediately with the American people. Identify with them, with the needs that they have. She is a very, very down-to-earth person.
CHERNOFF: Palin supports oil and gas drilling in the Arctic National Wildlife Refuge. John McCain has opposed that in the past. But calling for more oil drilling is now one of his campaign staples. While Palin has boosted revenues, she's a fiscal conservative. She chopped 10 percent of spending that state legislators approved for hometown projects.
Governor Palin may be short on executive experience, but she does have plenty of involvement with the oil and gas industry. Given the country's energy crises, that could be a real asset to the Republican ticket.
Allan Chernoff, CNN, New York.
ROMANS: The Democrats made their taste at the Democratic National Convention this week. The Republicans are up next. Gas prices, energy bill, credit crises. Did Barack Obama show he is the candidate to lead America at a financial peril? Or did he leave the door open for his opponent John McCain as he takes center stage in St. Paul?
Stephen Moore of the "Wall Street Journal" joins us now with a look. Welcome back to the program Stephen.
STEPHEN MOORE, "WALL STREET JOURNAL:" Hi, Christine.
ROMANS: Let's start with the most recent and I guess that is John McCain announcing his running mate. The governor of Alaska. A life-long member of the NRA. Someone who has supported drilling in Anwr.
ROMANS: How is she? How does she stack up as a vice presidential choice for him?
MOORE: Well, this one is a shocker, Christine. I follow this stuff very closely. I didn't see this coming. I knew she was on the list. She's relative newcomer to politics, she's very conservative. One the problems with John McCain have had is trying to shore up his conservative base. I think this helps a lot. And it also will put the energy issue in my opinion, Christine, right front center. Because she's been one the most articulate spokespeople in Alaska for more drilling offshore and drilling in Alaska where we have so much oil.
ROMANS: Let's talk a little bit about that issue. Because energy, independents from foreign oil sources. It's been a very big deal. It's been linked by Bill Clinton, by Barack Obama, by John McCain and his allies, as foreign policy linked with domestic policies making some very big cases about this.
You know, is it possible, I mean, is it really fact check it for me. Is it possible for us to get independent foreign oil? When we are looking at a big storm coming up you know through the Gulf Coast and it just shows how dependent we are on oil.
MOORE: Well, we are dependent on foreign oil and this is one of the issues that the Republicans have been clobbering the Democrats on. The Democrats have been very much opposed to new drilling whether it's off shore in Alaska where we have so much oil deposits and I think it's one of the issues where you've got 75 percent of the Americans with more on the Republican position. So this is -- I think her Sarah Palin's being put on the ticket will just emphasize the importance of this issue. It's one of the few issues in recent months that's going in the Republican direction.
ROMANS: Is she going to be a lightning rod for the left because of her conservative views.
MOORE: We'll see. She's still a relative unknown. My joke about this is this shore up those three electoral votes in Alaska for those Republicans. But you know she is dynamic. I know her a little bit. She's a very charismatic figure. Whether she can perform on the national stage is yet to be seen. ROMANS: How does she stack up with Joe Biden, who has an awful lot of experience on foreign policy?
MOORE: He does.
ROMANS: And people know he's run for president twice himself. He's been around the block.
MOORE: Well, now you have two polar opposite candidates. Joe Biden's about as liberal as you can get. Sarah Palin has very conservative credentials. You don't have any centrists among these two. It is true that Joe Biden's a good debater, he has a quick tongue. And that is going to be something that will worry Republicans whether she can stand up to him in that important vice presidential debate.
ROMANS: Let's talk about Barack Obama and the Democratic National Convention quickly. Because at the beginning of convention week, there were some criticism and even from within the party that they were not hammering home enough. That George Bush has pushed the United States economy into the tank.
Now, and I say this every show. Presidents get too much credit, too much blame for the economy. But by the end of the week, you saw them trying to make that case but McCain is a third-term of George Bush and George Bush is in charge of a bad economy. Did they make that case? And you know does it resonate, and is it true?
MOORE: They certainly made the case that the economy's underperforming and that there's a lot of economic anxiety out there. But what they didn't do to me, Christine, is really make the case about how their change is going to make things better. You know, what you're going to hear next week from the Republicans is, it's all the wrong kind of change. It's bigger government, more liberalism. Higher taxes on investors and so on that are going to make it harder for the economy to grow.
So the real issue in this campaign is going to be, who is the real change agent? Don't forget, John McCain has been one the real mavericks in the United States senate and I think he's going to try to make the case next week, look, I'm for change too but the right kind of change that'll grow this economy.
ROMANS: All right. Steven Moore, "Wall Street Journal." Thank you for joining us.
MOORE: Thank you.
ROMANS: Up next on YOUR MONEY what the voters are saying about the conventions on both sides of the political fence.
ROMANS: While the GOP gears up for the Republican National Convention this week, Democrats head back to the campaign trail. What do voters want to hear from both parties over the next few weeks? Joining us here in New York is Andrew Wilkow. Andrew is host of the "Wilkow Majority." Conservative talk show on Sirius Satellite Radio. And in Denver Mark Thompson, Sirius Satellite Radio host himself. His show is "Make it plain with Mark Thompson." He's a supporter of Obama.
I want to start with you Mark, first in Denver. Tell me what did people want to hear from this candidate and this party this week, and did they get what they wanted?
MARK THOMPSON, HOST, "MAKE IT PLAIN:" Last part, certainly. I believe that people got what they wanted. The Democrats heard what they wanted to hear. They wanted to continue to hear about hope and change and optimism. And those may be nonspecific words, but yet they're meaningful words in these times. And the Democrats heard that. They were revved up and inspired. But they also heard some specificity. They heard about Barack Obama's tax plan that would provide a tax cut to the middle class which John McCain's would not.
They heard about his health plan. They heard about his environmental plan. They saw, over a dozen retired military general's stand up and say that Barack Obama could do the job. That he could be an effective commander in chief. They heard a former commander in chief Bill Clinton say that he was ready and prepared to lead. And they saw Hillary Clinton on this anniversary of Dr. King's "I Have a Dream" speech. Have a Rosa Parks' moment of her own and stand up by acclamation and make a motion for acclamation that Barack Obama be the nominee. This was a great convention and an inspiring convention.
ROMANS: Andrew, a lot of moments at this convention. And a lot of them covers, the first of two, so a lot of coverage, a lot of interests in this. You know a big, huge, outdoor stadium. Hillary Clinton, the Bill Clinton and all of the, I don't know, punditry, around, did they say what they meant? And what did they really -- you know, just an awful lot of around this thing. What are your conservatives' listeners saying about the Democratic Convention, and some of the pageantry, I guess, as some would call it.
ANDREW WILKOW, HOST, "WILKOW MAJORITY:" Well, the theatrics were all nice and cute and we the moments and you know we had certain things, timed for anniversaries. But what conservatives heard was bigger taxes. And when you listen to Democrats talking about how they are going to create jobs while they're penalizing the people who create them, we know that the jobs don't get created if the people are -- who are charged with creating those jobs are going to suffer penalties for it. I mean --
ROMANS: That means raising the taxes on the people who are the wealth creators according to --
WILKOW: According to industrialists.
ROMANS: But I think that he wants to lower the tax rate for corporations, doesn't he?
WILKOW: Well, the capital gains tax, he wants to raise it.
ROMANS: I see it. WILKOW: He is saying that if you invest and you actually you know, do well, we're going to take more. So that says to a lot of people, why I want to risk the money in the first place if I'm not going to see the reward.
ROMANS: So these are ideological lines that are still drawn between the Republicans and the Democrats?
WILKOW: Talking about the economy. If you want jobs created, you cut taxes. You free up more money. The economy has never benefited from the government confiscating money from the economy for its own purposes. Jobs don't get created if the people who have the capacity to create -- the government doesn't create jobs.
ROMANS: So, let's talk about this. I want to ask both of you about this. The idea of putting John McCain with -- with the Bush administration in the last eight years the Bush administration and making McCain a proxy for eight more years, I mean under the Republicans, you can't argue some of these economic numbers. It hasn't really been great.
Now presidents get too much credit. I always say this and too much blame for what's happening in the economy but let me ask you, Mark. Do you think that they did the right thing by trying to tie McCain to the last eight years of Bush? And do you think that that resonates?
THOMPSON: I think it does. And McCain has tied himself with Bush. He's voted with Bush over 90 percent of the time. In fact, prior to the tax cuts, McCain was opposed to them. Then he signed onto this. . And Andrew may say that tax cuts create jobs, but I'm -- I don't know what he's speaking of. The unemployment rate in this country has been higher than it's been in decades.
We've had record unemployment with the Bush tax cuts. All Barack Obama is saying is that we restore the taxes where they were before the Bush tax cut go back to the taxes raised. No, well, no that's not confiscating because that money was already there. It was taken there. And to say that you're going to cut taxes for the middle class, which is suffering out here.
WILKOW: Protection for everyone.
THOMPSON: I think the right -- for it is the right thing for anybody to do.
WILKOW: Now this is the stereotypical class warfare stuff that that the middle class, that everyone should get a tax cut. Since when are you somehow a different American in a country where we believe that everyone has individual rights and individual freedoms and are treated equally.
THOMPSON: Andrew, Andrew, even you would get a tax cut. Even you.
WILKOW: Everyone should get a tax cut. Every single American should get a tax cut.
THOMPSON: But, you see, the only people who would not get tax cuts would be the people.
WILKOW: Who contributed most to the government?
THOMPSON: The people making over a quarter of a million dollars. Most of us do not make over $250 million. You say cut taxes to everybody.
WILKOW: Everybody. Every single person.
THOMPSON: He's only cut taxes for the rich. John McCain is only going to cut taxes to rich.
WILKOW: So all of a sudden now somebody that we should infringe more on.
THOMPSON: Andrew, you're contradicting yourself.
ROMANS: We're going to leave it here, gentlemen, for just a second.
We'll talk about this when we come back from the break. What's so exciting about this is that you've got two presidential candidates who have very different views on how to fix the economy and so your vote really matters. It is all very important stuff to stay tuned to and we're going to come back with these gentle men to discuss it and argue a little bit about it with Mark and Andrew about who is influencing voter's opinions and who is winning the battle for your vote.
ROMANS: I'm back with Andrew Wilkow host of the "Wilkow Majority" of Conservative talk show and in Denver, Mark Thompson host of "Make it Plain with Mark Thompson." He's a supporter of Barack Obama. You guys have very clear differences on what the plans look like in terms of taxes. I want to move on very quickly to vice presidential candidates, Joe Biden for the Democrats. And it looks as though, Andrew, it looks as though it could be a surprise out of left field for John McCain. Do you think that this will rev up the debates?
WILKOW: Well, right field.
ROMANS: There you go.
WILKOW: I think that she would bring a lot excitement. I have been rooting for her on my program for the past six months because I have been following her since the whole leer jet on eBay thing.
ROMANS: Remind us what that was.
WILKOW: She -- her predecessor had purchased a jet on the public, you know the public credit. And she sold it on eBay.
ROMANS: She made a statement, this is not what we do with the public's money.
And she is a down-the-line conservative. She's someone that could speak of her conservatism in a fashion that other people will become excited about it. And I think John McCain will be saying, look, I did something nobody expected me to do. They're trying to paint me as this stodgy old man. Look, here I did something that nobody expected me to do, huh! What do they say about your vice presidential pick, it's your first act as president.
ROMANS: That's true. Now let me ask you Mark, how long is this going to be important for the Republicans beyond the next couple of days? I mean, some people say it's the first big decision you make. And what really people want to know is this person can stand up and lead if something happens to you. What about this pick, Alaska's governor? What does it do for the Hillary supporters? For the female vote? Does it throw a wrench into -- into things for the Democrats?
THOMPSON: Well, I think you're very question, Christine, reveals the agenda. Republicans say they're opposed to affirmative action and in fact opposed to quotas. And the affirmative action was meant for -- is meant for qualified women and minorities to be given opportunity, qualified ones. We have no evidence that a governor with such a short term in office has any qualifications to step in if something were to happen to the commander in chief.
So this is actually worse than a quota. This is really tokenism. This is a way to try to appeal to Hillary supporters and I think it's a mistake on John McCain's part. It's a good mistake because I think ensures he's going to lose. But if he thinks he's going to win over women in the electorate by picking --
WILKOW: Wait a second.
THOMPSON: I don't think that it will work at all.
WILKOW: Let me get this straight I don't mean to cut you a off. It's a bad idea to pick a VP with limited experience but you'll hand over to the White House to someone with absolutely no executive leadership.
THOMPSON: How on earth, Andrew, can you compare -- how can you compare Senator Barack Obama to Governor Palin?
WILKOW: She's an executive leader.
THOMPSON: We don't know much about her.
WILKOW: She's a governor.
THOMPSON: She may be a very decent person, but --
WILKOW: But governors have executive leadership.
THOMPSON: There were, Andrew, are you going to say to me that she's more qualified --
THOMPSON: Than any other Republican in the field that he could have chosen? Even amongst his opponents. You're going to say that she's more qualified. Is that you're saying?
WILKOW: In the choice of conservatives is more likely Bobby -- and she had gubernatorial experience.
THOMPSON: Is she more qualified --
THOMPSON: -- than them?
WILKOW: Yes. She's a leader.
THOMPSON: Andrew, it is tokenism. I think that it will offend most women.
ROMANS: We'll see how it plays out on the campaign trail. All of these developments change. We've got eight weeks to go, gentlemen, before we get into the voting booth. Who knows what will happen next. Andrew Wilkow with the "Wilkow Majority" thank you so much for joining us. Also, Mark Thompson, "Make a Plain with Mark Thompson." He's out in Denver where there has been a whole lot of hoopla this week. Hope you had a great time, hope to see both of you again soon. Thank you very much, gentlemen.
Coming up, two storms race toward the Gulf region. What that could mean for your gas prices and later. As we mark the third anniversary now of hurricane Katrina, is New Orleans ready for the next big storm? We'll take a look next.
ROMANS: Happening now in the news for you. The exodus has already begun on the U.S. Gulf Coast, as hurricane Gustav, now intensified to category 4 status. We're just getting that in. It tracks towards a storm wary populist, certainly.
New Orleans Mayor Ray Nagin just addressed this issue just a few moments ago.
MAYOR RAY NAGIN, NEW ORLEANS: So if he starts it in the morning at 8:00 to coincide with us right there before, everything will work very smoothly. The critical part with the city-assisted plan is not necessarily in my opinion, when contra flow starts but how many buses the state will pre stage at Zephyr Stadium. If we have enough buses and we have a little surge at the end that we're able to accommodate every citizen and put them in the contra flow and send them out.
QUESTION: (INAUDIBLE) QUESTION: The buses all 22 of them, where have they been taking people? And secondly, will the city-assisted plan continue even after the mandatory evacuations declared?
NAGIN: Most of the buses that, as we understand it, are going to Shreveport and Alexandria. There's any, the state has different design this time. There are many more shelters, but they're smaller shelters. And we think that that's going to work pretty good. What's the second part of your question?
QUESTION: Will the assisted evacuations continue even after the entire evacuations in the entire city?
NAGIN: It's scheduled to conclude with the announcement of the mandatory or the effective time. But we'll continue to help people to get out of the city until the winds get to the point where transportation can no longer function.
QUESTION: And are there reason for people to go to -- (INAUDIBLE) in the city after --
NAGIN: Yes, ma'am. Everyone who was transported will have arrived back to the city and get back to their homes.
QUESTION: Mr. Mayor, how would you inform a mandatory evacuation?
NAGIN: How are we planning to enforce it?
Well, by law, once we issue a mandatory evacuation, all citizens are required. But you have your own -- we are respecting the individual property right. So if you decide to stay, which we are not, we're encouraging you to leave, you will be required to stay inside of your property.
QUESTION: Different than in Raleigh?
QUESTION: Over here for a second.
QUESTION: Mayor Nagin, first, you are speaking more than 30,000 that will need assistance? And second can you talk about some of the challenges of implementing plans when we had such a code of uncertainty of the storm and a number of different things?
NAGIN: We -- the way it's shaping up to be right, so far as the numbers are concerned, the 30,000 number still looks pretty good. We've got 20,000 registered at this point. I think that's going to be the biggest surge that we will get. So the 30,000 number looks good. But even if the number's bigger than 30,000, we have some to accommodate many more citizens. And, the second part of your question?
QUESTION: What are some of the challenges of implementing them? Because you don't want to scare people but you don't want people stuck behind so the challenges of implementing a plan of that huge point uncertainty? NAGIN: Well, we just had a discussion a minute ago in our briefing and what we try to do in these evacuations is to progressively step up our rhetoric if you will. Versus what we did the last time today is about, get out, we're strongly, strongly encouraging, tourists definitely get out and then the next time that you hear us is get the heck out. And mandatory get the heck out and we'll continue to do that as time goes on.
But once this storm gets in the Gulf of Mexico and people really see how big and dangerous it is, that's going to help our efforts to encourage people to leave.
QUESTION: I have two questions, mayor. The first is, crunching in numbers about 3,000 people have gotten out of buses so far. I guess about 17,000 more to get out. Can you get them now that 24-hour period? And the second question, you're strongly urging people to get out. Would you call that a voluntary evacuation to use the terminology?
NAGIN: I mean, you can call it whatever you are comfortable with. Voluntary, strong involuntary, whatever works. But yes, we're -- we think we're OK. I mean the 2,000, 3,000 people that we processed thus far, I'm not sure that we could have handled anymore to be totally honest with you. It allowed us to work out some bugs. The system crashed. We had to make some adjustments.
So we think that we're OK but during the rest of the day I think we're going to continue to process at a pretty steady level. Then once the storm gets in the Gulf, I think we're going to see another surge and that's going to be the real test and that's why I'm hoping that these buses are prepositioned at Zephyr Field so that we can move more people out, once that surge happens.
QUESTION: Mayor -- question Superintendent Riley. About the curfew situation once and once that mandatory evacuation is called.
UNIDENTIFIED MALE: The curfews not issued by the mayor yet. I'm sure that he'll do that sometime when it's appropriate at the contra flow. When that occurs, individuals, who are on the streets of New Orleans, who are not on their own property. And in all likelihood will be arrested. They will be represented.
UNIDENTIFIED MALE: It's a great partnership; over 5,900 National Guard troops are in. We'll be pretty able to lockdown this city. I think that the citizens should be fully confident that with a number of law enforcement officials here, that we will be able to handle this very, very well.
And we encourage them to leave. And to feel comfortable about leaving their homes and their possessions because we will have the city blanketed. We can't promise nothing will happen, but certainly it will be a tremendous force of law enforcement and military people here. And also --
QUESTION: I'm sorry.
QUESTION: Mayor, how far behind schedule do you think that [inaudible question]?
NAGIN: I think we slipped behind earlier this morning but we've caught up. We've suspended the governor placed an order to suspend the processing on the front end. And that just unleashed a lot of energy. So we think we've caught up. The issue now is getting the RTA buses back out in the field. Quickly, to get people who are waiting at the 17th charter I mean the 17 pickup ones.
So we're in good shape. You know to build upon what chief just told you, during Katrina, we had 1,700 police officers, we had a couple of hundred that left. So we had probably chief -- anywhere from 1,000, 1,200 police officers.
About 1,300, 1,400 officers and plus another 100, 200? We had National Guard about 300, 400 that were in the superdome but only assign to the superdome. Three, 400 in the superdome. So you had 1,200, 1,300 police officers patrolling the whole city. This time around we'll have close to 1,500 NOPD officers. Plus we will have at least 1,500 to 2,000 national guards. It's double the amount of protection that we had for Katrina.
QUESTION: Mayor, what about those people who may have not heeding the order now and at the last minute saying --
NAGIN: Well, we're going to try to accommodate as many people up until the time -- you know, the absolute time when we have to stop everything is when tropical force winds hit New Orleans because the Crescent City connection shut down. The interstate shut down and then everybody has to hunker down as best they can.
QUESTION: Mayor, does this go 24 hours? You're doing this 2:00 in the morning tonight?
NAGIN: We're going to be working all night, as best we can and if we have to suspend overnight, we will start back over in the morning but we're planning to work for 24 hours.
QUESTION: Mayor, can the city handle if there is another major flood?
NAGIN: We have invested a significant amount of money in levee protection. So I'm not anticipating the kind of flooding that we had for Katrina. If we have anything it'll be street flooding and hopefully not that bad. Emotionally, can we handle this? I think there's a lot of fragileness about our psyche right now in this city. I wouldn't be honest with you if I told you something different. It's going to be a tough one. But New Orleanians are very tough and we'll get through this.
QUESTION: Upgraded to a category 4. Does that change anything?
NAGIN: I'm not surprised. I mean when it went to a category 3 last night before it crossed Cuba, that said to me that there was some very warm waters that -- you know, that loop current that everybody's talking about, the loop current is very interesting to study, because normally those warm waters are not that deep but the loop current that can go down as far as 200 feet. So if a hurricane stirs up, the warm water's normally the cool water comes to the top.
That's not happening with this storm. So this storm will be at least a category 5 and I'm not a meteorologist. So please take this for what it's worth. But it has the potential to get even stronger. And that's why we're encouraging everybody to take this very seriously start the evacuation process.
QUESTION: I think that you mentioned something about -- can you clarify that?
NAGIN: If the state has the final call in the contra flow and if they are starting at 6:00 a.m. in the morning that's a good thing because that will sync up very well if we have to call a mandatory evacuation at 8:00 a.m. But I will encourage our citizens not happen to wait until that happens. Yes sir.
QUESTION: How long will people be able to take I-10 east out of city towards Mississippi, away from Mississippi? A lot of time the contra flow from the west. And this morning, we noticed that it was no wheelchairs for a lot of elderly who were kind of buckle a little bit under the heat. And are there attempts to change?
NAGIN: We're working on the tent issue. We're also having machines come in. And this is the first time that I've heard seniors need wheelchairs. We'll see if we can deal with that as time goes on.
QUESTION: Mayor, the National Hurricane Center --
NAGIN: Hold on, hold on.
QUESTION: I'm sorry.
QUESTION: To address your observation, we're well aware that there's a wheelchair need and a cot need. Those resources have been asked for and incoming. So we're doing everything to keep the elderly and all of our citizens well hydrated, cool, and shaded, with misting tents and tents. They're all coming. I'm sorry; I'm doctor with the New Orleans EMS.
QUESTION: The mayor, now calling this storm quote/unquote an extremely dangerous storm. You touched on tourists. There are a lot of tourists in the city right now. It's a big weekend. Would you urge, these event organizers to cancel events and urge their tourists to leave town? Given the fact --
NAGIN: Yes. That's my message today is it's time for us to kind of shut the tourist activities down. And I'm asking all of our tourists to start to move to evacuate. We need to get them out of way so that we can deal with our senior citizens and the people who need assistance.
QUESTION: Are you satisfied that there's an awful lot of -- (INAUDIBLE) on the ground or in ground.
NAGIN: It's my understanding that the planes, the airlines have been put on notice and they're expecting this and also the federal government has some additional assets that are going to be available to fly people out. So that's going to probably kick up based upon what you're saying today, that's going to start to really take force this afternoon.
QUESTION: Can tourists -- tourists who are scheduled to be here through Tuesday or Wednesday and they can't get on a flight, can they take --
NAGIN: We will accommodate any tourists that needs to leave the city and does not have transportation, absolutely.
QUESTION: Mayor, do you have any details (INAUDIBLE) --
NAGIN: I've not heard from the hotels so far as the actual numbers. Most of them were planning to close sometime today. As a matter of fact, Harrah's Casino's is closing at 4:00 p.m. That was there, the latest that I got from them.
QUESTION: Any contact from the university president --
LUI: And there, you have Mayor Ray Nagin of course address ago.
Listening to our local affiliate there as we got that live signal. The New Orleans' Mayor Ray Nagin there, giving us the latest on what is happening in terms of their preparations out of New Orleans. Talking about contra flow, where they reverse the flow of traffic on certain roadways to get the people out as well as individuals being arrested. They will be arrested after a certain point today and as well as the evacuation plans and how they will be suspending the processing at certain evacuation points.
Our Sean Callebs was telling us earlier that processing was causing some trouble earlier on in terms of getting people on those buses and out of New Orleans. And we're looking at one of the first trains to leave out of Amtrak Station a little bit earlier.
OK, this is just one of many briefings that we'll be listening in to for you right here on CNN. As we stay on top of what is happening there with Gustav. I'm Richard Lui in Atlanta. We're going to keep our eye as the situation warrants.
And now back to YOUR MONEY in progress. We'll have a break after this as well.
ROMANS: It's been seven years now since our last recession. Times are tough once again. We're talking about whether Americans are better off today than they were back in 2001. We're hearing it on the campaign trail. Jeanne Sahadi, Paul La Monica and Tami Luhby from CNNMONEY.com are back about that discussion. Tammy, what have you been hearing from people, on the Web site you say come and tell us whether you are better off. What are people saying?
TAMI LUHBY, SENIOR WRITER, CNNMONEY.COM: We want to hear from people so we're allowing them to write in, via e-mail or put up ireports so they can tell us what's going on. And it is really a mixed picture, I mean some people are saying that they are saying compared to 2001, they now own a home. They now have better jobs or at least making the same amount of money, they have more savings in their 401(k).
People don't think about their 401(k), but look at balance between 2001 and now and hopefully it's gone up but other people of course who have lost their jobs. People in their 50s who just sent their children off in college and they are saying that we should be preparing for retirement. My husband lost their job. They say that we have to work till we die.
ROMANS: Looking at these bankruptcy statistics that came out this week that show just a spike, I think 29 percent increase in bankruptcies, almost a million more bankruptcies. But I was looking at the 65 or older, and what does that tell us?
LUHBY: People are not able to pay off their homes and retire comfortably as they had.
ROMANS: Bankruptcy at 65 is really -- it's a hard thing to imagine in this part of the country in the world where we're used to creating an awful lot of jobs every month and haven't been this year.
JEANNE SAHADI, SENIOR WRITER, CNNMONEY.COM: If the home is the main reason for that and that is that the person is relying to their retirement savings. A big problem for a lot of people. In fact, I think that couple in the 50s said, oh, lost value on both of our homes. They own one outright and they have a mortgage on the second but they can't sell either one.
So much for retirement. And they didn't mention that they have a 401(k). 'I think with the bankruptcy statistics, the main reasons for declaring bankruptcy are job loss, divorce, medical crisis. And that happens regardless of what the economy is doing for most people. But I think because the homes aren't selling or you're losing value and if people lean too heavily on that they're going to be more inclined.
ROMANS: People with the foreclosures and the defaults that we're starting seeing last year and the arms started to reset, people were losing their homes, not because of the traditional reason which is, job loss, divorce, terrible illness. They were losing them because the financial product that they had bought was not something that was suitable for them. Now you're layering that on top of the traditional reasons and I wonder what that's going to mean for 2009 and for the housing market.
PAUL LA MONICA, EDITOR AT LARGE, CNNMONEY.COM: yes, few people expect the housing market in 2009 to get significantly better. We're starting to see some evidence may be that things are stabilizing. But we -- that means that we drag along the bottom for a while. That doesn't mean that we actual go on in an upswing anytime soon so I think there are still a lot of concern about the housing market.
ROMANS: When dragging along the bottom is an improvement, right, and then we're all looking forward to --
LA MONICA: Drowning still trying to find it, I guess?
ROMANS: Right. $3.68 for gas, ah, it feels great, doesn't it? These are some of the realities I, guess that we have to look at. And these are the things, the next president, whoever he is, are really going to have some serious economic headwinds.
Now when Bill Clinton took over, he had these same kinds of headwinds but we all know the economy goes in cycles as well too. If Barack Obama becomes president there's a Democratic Congress. So somebody will say an easier time getting some of his plans through. If John McCain becomes president he could have some you know trouble with congress. What do we think; do we think that it's something that a president can handle? In 100 days.
LA MONICA: No.
LUHBY: No, not at 100 days and it's also a global economy now. So there are pressures on the president that are beyond his control and beyond the United States' control. So we really have to get businesses in, giving people good, solid jobs, with good, solid incomes.
LA MONICA: At the end the day he's not running for re-election but Ben Bernanke is arguably more important. And its interesting Bill Clinton obviously gets a lot of credit for the boom in the '90s. You could argue that that was Alan Greenspan who deserves some of the credit and now Alan Greenspan's getting the blame for bringing rates down so low because of the last recession rates down so low after the housing baseball.
ROMANS: And Bill Clinton signed the financial modernization act, you know the dismantling those depression era, hindsight is 20/20, but some people are starting to say hey wait a minute maybe some of the seeds of today's crisis were planted back in the boom of the '90s.
SAHADI: Also Bill Clinton came into office, he had all these great promises of cutting taxes but he ended up paying down the deficit. So the plans of the next president coming in could be compromised by the housing crises, the credit crisis, and the deficit they're inheriting.
ROMANS: Jeanne, Paul, Tami thank you so much for joining us.
Up next on YOUR MONEY, it may be time to turn that frown upside- down when it comes to America's economic outlook. Why we may not be headed for recession after all.
But first, this week's "Right on your Money." (BEGIN VIDEOTAPE)
ROMANS (voice over): Handling your own money is tough enough so how do you teach your kids to handle their money when they're heading off to college?
JANET BODNAR, DEP. EDITOR: It's really important to have this discussion before you leave the kid off, number one. So they know what's what. I think sometimes you can say, look, to the child, we're going to cover your books, we're going to cover your transportation costs back home, but you want to visit your friend at another school, you have to cover that cost.
ROMANS: Don't underestimate the cost of textbooks.
BODNAR: Well, the average is somewhere between $800 and $1,000 a year if you buy them new. Now there are lots of really of really good Web sites online where you can buy books at a discount and also look at each school, too. Because they have used book networks.
ROMANS: Check out ecampus.com, half.com or bookswap.com for deals on used textbooks and avoid credit cards at least until your child has learned to manage a bank account.
BODNAR: I don't think freshmen need credit cards. I think that what they should learn how to do first is manage a bank account with real money and a debit card. Once they have proven that they can do that without overdrawing the account, once they can live through a whole year on their summer earnings from the previous summer, then they can go ahead and apply for a credit card.
ROMANS: That's this week's "Right on your Money."
ROMANS: Our friend and colleague Jennifer Westhoven is here with a look at some of the big stories this week. A couple of people saying recession, look at second quarter growth. It was fantastic. Take it easy, right.
JENNIFER WESTHOVEN, CNN CORRESPONDENT: Take it easy, yes. Because people still think there's trouble ahead, but this was a surprisingly strong report, it showed the economy grew just solidly in the second quarter. This is GDP, it showed growth. That's partly thanks to the $90 billion in stimulus checks and trade because the dollar has been weak.
But the revised look showed it up by 3.3 percent, that's better than expectation and it's certainly much stronger than the measly growth we had in the first quarter which was just under 1 percent. Now the normal growth is typically 2.5 to 3 percent during green times so that's pretty good. So for a little while it does seem to be quieting down that question, are we right on the edge of recession.
ROMANS: It took $90 billion in government checks and a very weak dollar to get us back to what is normal growth.
WESTHOVEN: And is that it, right?
ROMANS: That puts it into perspective, right?
WESTHOVEN: Certainly the trade part is something that could keep going because the dollar is still relatively weak, but I think that was just a surprise that the numbers would go that high.
ROMANS: We must have been spending that check, too.
Let's talk about the banks on the watch list. Because we learned this week that more banks are being watched by the FDIC for potential trouble ahead.
WESTHOVEN: We knew there were 90. Now that risk has gone to 117 names, so that's the highest in about five years on this FDIC watch list. They are not naming names but one of the big problems is that the concern is that this is what the FDIC covers these banks in case they go under on accounts up $100,000. Now they're saying with more banks expected to fail, we might not necessarily have the money to cover that. So we might go knock on the treasury's door which means taxpayers would be left holding the bag here.
ROMANS: We do know that the FDIC has hired back and on contract retired workers because there were so many years of good solid healthy banks, they didn't need some of these inspectors and some of these people to go through the books and put the banks back together again when they get in trouble. So we shouldn't worry that our bank is on this list because we're insured up to $100,000 for deposits.
WESTHOVEN: For a single account. They think this is mostly smaller banks if you start to think about the idea, it's mostly just fine and they are looking at smaller banks, but the forecast, a lot of economists think there are going to be a lot more banks that fail.
ROMANS: It's hard to imagine with just finishing up one convention going into another convention, two storms churning in the Gulf of Mexico, it is Labor Day. Traditionally a quiet part of the news cycle it hasn't been.
WESTHOVEN: It's supposed this time to relax and enjoy and there are so many economic worries out there, but if you're heading to the beach or neighborhood barbecue this weekend we just want to give you a reminder of why we have this glorious long holiday weekend. On Monday, our nation will observe Labor Day. And it's celebrated in the United States, Puerto Rico and Canada to honor working people. More than 82 million men and 72 million women make up the ranks of America's workers.
Labor Day dates all the way back to 1880 in this country when union members proposed the idea to honor workers. Oregon was the first state to call it a legal holiday back in 1887 and then seven years later in 1894, President Cleveland -- from New Jersey -- and the U.S. Congress made it a national holiday.
ROMANS: I did not know Grover Cleveland was from New Jersey.
All right, Jennifer Westhoven, thanks so much and you have a fantastic Labor Day weekend.
All right, thanks for joining us for this edition of "YOUR MONEY." We'll be back here next week, Saturday at 1:00, Sunday at 3:00. Ali'll be back then. See you then.