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YOUR MONEY

Political Viability of Gun Control Legislation Debated; School Invents Device to Combat School Shooters; Researchers Look at Spreading Internet into Sea; Robot Makes Noodles in China

Aired November 23, 2013 - 14:00   ET

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


CHRISTINE ROMANS, CNN ANCHOR: Guns in America. Billions of dollars generated millions of gun enthusiasts and thousands killed each year.

I'm Christine Romans. This is "YOUR MONEY."

It's been almost one year since 26 children and educators were shot and killed at Sandy Hook Elementary School in Newtown, Connecticut, and the debate over gun sales and gun reform rages on.

Big business has become involved. Starbucks CEO Howard Schultz asks customers to leave their guns at home when grabbing a latte.

(BEGIN VIDEO CLIP)

HOWARD SCHULTZ, CEO, STARBUCKS: We are respectfully requesting that those customers who are carrying a gun just honor the request and not bring the gun into Starbucks.

(END VIDEO CLIP)

ROMANS: Then there's Wal-Mart. The world's largest retailer and lightning rod would likely prefer to sit out this controversy, but it can't. The company hasn't released specific gun sales data, but it was widely reported some Wal-Mart stores sold out of the AR-15 rifle in the days following the Newtown massacre. That's the very type of firearm involved in the shooting.

I asked Bill Simon, the Wal-Mart's U.S. CEO, if he has second thoughts about selling these types of firearms in the very same stores that would ban a cd for controversial lyrics?

(BEGIN VIDEO CLIP)

BILL SIMON, PRESIDENT AND CEO, WAL-MART, U.S.: We are very responsible in our sales of firearms. It's something that we're focused on. The debate in the country about whether they should be legal or not legal is not one we get to participate in on a day to day basis. That's an issue that Congress has to deal with. But I would tell if they're sold in the U.S., we want them sold through formal channels rather than through gun shows.

(END VIDEO CLIP)

ROMANS: No matter how a gun is purchased or obtained, the gun debate has changed since last December. Here's what chief international correspondent Christiane Amanpour told me a year ago.

(BEGIN VIDEO CLIP)

CHRISTIANE AMANPOUR, CNN CHIEF INTERNATIONAL CORRESPONDENT: This was a red line by anybody's account. These were babies. This was a biblical slaughter of the innocents.

(END VIDEO CLIP)

ROMANS: But talk of reform, big talk of reform, was sidelined for more pressing problems in Washington. I sat down with Christiane Amanpour and chief political correspondent Candy Crowley and I asked them why.

(BEGIN VIDEO CLIP)

AMANPOUR: It's tragic. And the president made a lot of very good speeches and made a lot of efforts, but it didn't go far enough. And, look, all you have to do is look at the politicians who are worried, scared, what is the right word, about the NRA. On my program we interviewed a lawmaker from Tennessee who recounted chapter and verse about how she was in good standing with the NRA, but nonetheless because she wanted a minimal sensible change, she was literally run out of office.

And that is what the politicians are afraid of. It's very, very frightening because overseas, Australia, Britain, after big massacres they made very tough political conditions to rein in gun control and they haven't had those same massacres.

ROMANS: Is this an example of a domestic agenda by this president that has been sidelined, that he has not been able to achieve? In the state of the union, for example, he talked about early childhood education. He talked about immigration reform. He talked last year about gun control, or gun reform. He hasn't been able to do any of those things.

CANDY CROWLEY, CNN CHIEF POLITICAL CORRESPONDENT: He hasn't. In part it's been the economy, and he would say today, my biggest focus has to be on creating jobs. And then came health care, and that's been an ongoing problem for them. And besides, you know, those saying we can walk and chew gum at the same time, but they have gone to the state level for gun control. That this is -- you know, that's where the big fight is now is what states do, because at a national level it becomes very difficult.

It also -- the Virginia win for the democrat, for Terry McAuliffe is being seen as a defeat for the NRA. I think that's, you know, people, view it through their own Rorschach tests. So, you know, yes, Cuccinelli, who lost, the Republican, was backed by the NRA. But this is not as simple, and this is what -- and, by the way, what kind of end to the gun control push, certainly in the Senate, had -- would have ended in the House, anyway -- there was a lot of Democrats who come from gun culture states. They say, wait a second, wait a second, wait a second. And the problem is there has to be some sort of two- track thing, because everyone will come back to you and say, look at the last -- you know, five gun -- gun incidents that have been big, all mentally deranged people, all people with huge mental problems. The country's not doing a good enough job on mental health.

(END VIDEO CLIP)

ROMANS: Despite some high-profile school shootings, school has become a safer place over the past two decades. That's according to new numbers from the U.S. departments of justice and education. I want you to take a look at this. During the 1992-93 school year, there were 57 violent deaths occurred at school or when traveling to or attending a school sponsored event. You see the trend there. During the 2010-1011 number that number was 31. It's important to note numbers are not in for 2012 and 2013. Of course, that school year when 26 deaths occurred at Sandy Hook elementary school in Newtown, Connecticut.

Overall, youth homicide at school accounts for less than two percent of all youth homicides. That, of course, doesn't do much for the fear factor among many parents and students. Our Zain Asher visiting a school that has taken the fear of school shootings and channeled it into innovation. Hi there, Zain.

ZAIN ASHER, CNN CORRESPONDENT: Hi. So it's pretty interesting. You have a group of high school students at a high school in Washington, D.C. invented what they call a mocking device, a device they hope will protect them in an intruder or a school shooter tries to break into their classroom. It's pretty simple stuff. It's made of a PVC pipe and a steel pin, something you can pick up at a local hardware store. I think what's really sad about this is that you have a situation whereby 15 and 16-year-olds are trying to protect themselves from arm the gunmen. Take a listen.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: This is dead stop.

ASHER: It costs just $5 to make, weighs less than a pound, but students here at high school in Washington, D.C. hope that this simple invention could protect more students during school shootings than metal detectors and bag checks.

JOHN MAHONEY, MATH TEACHER: With active shooters being unfortunately so prevalent we need to come up with other ways to secure buildings.

ASHER: Students and teachers here have been oh shaken by recent shootings --

MAHONEY: For me, the key shooting was in Columbine High School in Colorado where it was actually a mathematics teacher who was killed and I teach mathematics here.

ASHER: They've invented a locking device for classroom doors.

DEONTE ANTRUM, STUDENT: It can happen in Connecticut it can also happen here in D.C. ASHER: Made up of a PVC pipe and a steel pin, the device can be fitted over a hydraulic door closer if ever there's an intruder in the hallway, keeping the classroom firmly locked and preventing a gunman from gaining entry.

ANITA BERGER, PRINCIPAL: In lieu of trying to get all of the school doors with dead bolt locks on it, I think this is a quick, practical way of doing it.

ASHER: Like in many schools across the country, schools cannot be locked from the inside for fire hazard reasons. At Sandy Hook elementary school last December, one teacher had to lock her students in a bathroom to protect them from 20-year-old gunman Adam Lanza.

ANJREYEV HARVEY, STUDENT: The recent shooting at another school where the shooter broke into the building and shot a lot of kids, it inspired us, because the doors aren't that secure.

ASHER: Students here were recently awarded a $6,600 grant from MIT to develop a final version of their device.

MAHONEY: We're not ready for an IPO yet, but we anticipate having a really good prototype by the spring.

ASHER: And with this crude safety mechanism, they say they now have an extra barrier in place, if they ever hear gunshots from the hallway.

(END VIDEOTAPE)

ASHER: And I did get a little good news from that professor you just so, John Mahoney. He said to me a lawyer in Denver randomly heard about the device and offered to patent it for free. He has no idea how he heard about it. But he says they're not interested in making money off this. It's just something they wanted to share.

ROMANS: It's only $5 and a PVC and a clip. Sad that we have to look at these innovations, but interesting we have to make them. Zain Asher, thank you.

All right, the Fed has been pumping $85 billion a month into the economy, keeping stocks and housing hot, right? What happens when it eases up and is not going in anymore? Can the economy hold up on its own?

(COMMERCIAL BREAK)

ROMANS: The Dow celebrating sweet 16 -- 16,000, that is, up 3,000 points from the beginning of the year. Housing still riding high thanks to cheap mortgages. Welcome to the bubble. The Federal Reserve pumping $85 billion a month into the economy, and that's creating a protective shield.

The Fed stimulus was supposed to end when the economy became strong enough to stand on its own, when unemployment dropped to 6.5 percent. But now the economy may have to venture outside the bubble without protection. Harvard professor Ken Rogoff is a former chief economist with the IMF and a man who knows financial crises like no one else.

Ron Brownstein is a senior political analyst for CNN and editorial director of the "National Journal." He has the inside scoop how Americans are reacting in the five years since the economy hit bottom. Ron, we call it one America, two economies. You have a new poll out showing less than a quarter Americans think the economy is on the right track, down from 47 percent in 2009. The economy is improving slowly. So why the disconnect?

RON BROWNSTEIN, CNN SENIOR POLITICAL ANALYST: Yes, look, I think this is the quarterly poll we've been doing since 2009, the All State "National Journal" Heartland Monitor, exploring how average Americans are navigating the changing economy. And the overriding message from the new poll, which is really about attitudes towards the financial system five years after the crash, is that we are on two very distinct tracks.

Because of the factors you're mentioning, stabilization of housing prices and a Dow at 16,000, roughly the top third of the income ladder, people with college degrees, people above the median income, are feeling pretty good about the financial system again, feeling pretty good about their ability to navigate it and make it work for them.

The rest of the country is feeling very scarred, still feeling that it is opaque, volatile, kind of beyond their ability to really make work for them. And it is a stark divide, not only in attitudes but participation. I mean, don't forget that, you know, only about one- third of Americans are saying in our poll that they have a 401(k) plan. Big divide between college and non-college. So who is benefiting from the asset inflation is very different.

ROMANS: And Paul Krugman is a liberal economist, a columnist from the "New York Times," someone you've tangled with before. Ken, what he says, "The evidence suggests we've become an economy whose normal state is one of mild depression, whose brief episodes of prosperity occur only thanks to bubbles and unsustainable borrowing." Is he right?

KEN ROGOFF, FORMER CHIEF ECONOMIST, IMF: I wouldn't go that far. My goodness, the United States has a lot of things going with it with au entrepreneurship, technology. It might not be as good as some boom periods, but I think we have growth periods ahead. It's not so dark.

ROMANS: Not so dark. Let me talk about the social safety net, because it has really expanded in the last few years.

ROGOFF: Right now, it's not so good. I'm talking about our long-term future.

ROMANS: Right. One of the reasons not so good right now, we've had this social safety net that has really propped up a lot of people. You'll see that pulling back, fewer people with unemployment checks. We've already seen fewer people on food stamps. Is that the right thing to do right now? ROGOFF: I think cutting back on food stamps is nuts. I mean, that's one of the most successful federal poverty fighting programs and that would be a very sad thing. You could tweak it by having it be more about food and a little narrower, perhaps, but that would be very sad.

ROMANS: But Ron, in this whole makers versus takers argument, it's really one of these things that has become a political -- a political -- point. Listen to this, Ron.

(BEGIN VIDEO CLIP)

SEN. MIKE ENZI, (R) WYOMING: Government keeps growing and growing and growing. And when it grows, that means there are more people in the wagon and less people pulling the wagon.

(END VIDEO CLIP)

ROMANS: You have an eminent economist here on my right saying it's nuts to pull back some of the stuff. You have politicians on the right saying, this is makers and takers. We need more people pulling the wagon, not in the wagon.

BROWNSTEIN: Yes. I think the core animating drive for the Tea Party and the Tea Party movement is not so much the overall size of government. It is the idea of transfer payments. And, you know, part of the -- a big part of the resistance to the Obama health care is polls by us and others show it is viewed essentially by the white middle class mostly as a transfer payment for the poor, whereas those same voters are much more resistant to changing Social Security and Medicare. That I think is the rub. That is where the political conflict is sharpest and is going to remain sharpest.

ROMANS: Nice to see both of you. Thank you so much.

Up next, cutting noodles and cuts costs, a Chinese inventor's futuristic solution to rising costs in the kitchen. Are jobs at stake as robots hit the workforce?

And imagine this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I said, sell. Sell it now.

ROMANS: Five hours.

UNIDENTIFIED MALE: Sell all of it.

ROMANS: Is this progress?

UNIDENTIFIED MALE: What are you talking about Google? What is this Internet?

(END VIDEO CLIP)

ROMANS: Is this progress or another chance to kick you with fees for flying?

(COMMERCIAL BREAK)

(MUSIC)

ROMANS: Labor costs on the rise in China and the rock band Styx may have said it best. A chicken farmer turned inventor created what may be the future of Chinese noodle-making. But could robots replace jobs in kitchens here at home? David McKenzie has that story.

(BEGIN VIDEOTAPE)

DAVID MCKENZIE, CNN INTERNATIONAL CORRESPONDENT: Look out. Here comes the future. Mr. Cui started out as a chicken farmer, but when a flu virus wiped out his flock, he searched for a new way to make a living. "I went into a noodle shop and saw the noodle maker made more money than me," he says, "but I didn't know how to make noodles."

So this amateur inventor built something that cooked. Call it the noodle bot. "With this robot, one minute, four bowls of noodles, he says, "with a chef, one minute, two bowls."

So the noodle bot is fast and it's also versatile. Mr. Cui said he can dough eight different types of noodles. This is the widest kind. He says he invented it to look like a person to give it that human touch.

"They designed it to look like a cartoon so that children like it more."

If I look at it, it looks a bit like you. It's kind of the same. "It's much more handsome than me," he says.

It took him three months to design the bot and years to perfect it. It's shipped across China and around the world.

So the factory floor is one thing, but the real test of the noodle bot is in the noodle shop. Let's see the noodle bot in action.

"The customers love it," he says. "They call him ultra-man."

But mostly, it saves him money. He doesn't need to train, feed, or give the noodle bot a place to sleep. "It saves me energy," says the noodle maker. "It does the same noodles that I do, and it costs less than me."

But as labor costs rise in China, robots are starting to replace human labor. It's cheaper, and the future the noodle bots could replace all the human noodle makers. Chopping noodles today, but who knows what's next for the noodle market?

UNIDENTIFIED: David McKenzie, CNN, Beijing.

(END VIDEOTAPE)

(LAUGHTER) ROMANS: All right, get ready to listen to your neighbor's phone conversation at 30,000 feet. That's if a new FCC proposal gets approved. Calls and texts could soon be allowed in the air, not just during takeoff -- not during takeoff and landing. But this could cost you more than your peaceful flight. Cellphone companies will have to shell out millions to instate your proper equipment to provide service. Experts say they're pass those costs on to you with permanent or per-flight fees or even roaming charges. Airlines are always looking for new fees to tack on as well.

For more of the stories that matter to your money this week, give me six minutes on the clock. It's "Money Time."

(BEGIN VIDEOTAPE)

ROMANS: The tech boys club might be opening its doors wider to women. In the last year 60 percent of the 60,000 jobs added in tech went to women, but they still make up less than one-third of all tech employees.

Google and Microsoft working to rid the Internet of child porn, teaming up to make sure the illegal content doesn't show up in search results and to remove images and videos from the web.

The price of Bit Coins soaring, but some senators worry the anonymous digital currency could be used for illegal activity like buying drugs or dodging taxes. The Bit Coin community wants the government to stay out.

Elvis Presley has a new owner. Authentic Brands Group bought the rights to Elvis photos, album covers, and movie posters. ABG also owns the rights to legends like Marilyn Monroe and Muhammad Ali.

Think Thanksgiving travel is bad? Two new studies find packed airports and lengthy delays could become the norm in the next decade thanks to crumbling air travel infrastructure.

And buyers beware, a Butterball shortage. The nation's largest turkey producer says it's short of large, never frozen birds this Thanksgiving.

(END VIDEOTAPE)

ROMANS: Up next, you've got Wi-Fi on the ground. You've got Wi-Fi on the plane. Now, the next frontier of wireless Internet is underwater. We dive into how and why researchers are trying to submerge the web, next.

(COMMERCIAL BREAK)

ROMANS: The U.S. may have the largest economy in the world and the strongest military, but Internet speed here is nothing to brag about. America ranks number eight when it comes to average Internet speed worldwide, behind Latvia and the Czech Republic among others. Could the future be making the Internet available in places that may seem unimaginable? A small group of researchers is working on just that question. CNN's Jason Carroll joins me now with the story. Hi.

JASON CARROLL, CNN NATIONAL CORRESPONDENT: It's a great story. This is going to benefit not just people in the U.S., but people all over the world. Call it deep sea Internet. Researchers say it could open up a whole new frontier for sciences and business. We went to upstate New York where researchers are testing to do see how it all works.

(BEGIN VIDEOTAPE)

CARROLL: These days you may find wireless Internet at some of the most remote places on the planet, on flight, even in space. Where you won't find it yet, at least not yet, deep underwater.

TOMMASO MELODIA, HEAD RESEARCHER AND ELECTRICAL ENGINEER, UNIVERSITY OF BUFFALO: These are devices that communicate underwater wirelessly.

CARROLL: Tommaso Melodia and University of Buffalo researchers developed technology they say will create a deep sea Internet, an idea initially fodder for late-night laughs.

JIMMY FALLON, LATE NIGHT TALK SHOW HOST: A Wi-Fi network that can work underwater. Yes. Well, Time Warner is trying to develop a Wi-Fi network that can work.

(LAUGHTER)

CARROLL: Of course, Fallon means Time Warner cable. Regardless, to Melodia, it's no laughing matter. It's been eight years of hard work. Melodia hopes the technology will improve tsunami detection, natural gas exploration, pollution monitoring, and security surveillance. But will it work? And how deep? We went out to Lake Erie with this research team to test the science behind it.

MELODIA: You get the wireless in the air, you do that through electromagnetic waves. You get wireless in water, do you it through acoustic waves, basically, sound.

CARROLL: It sounds a bit like how dolphins communicate. They use sound waves. These modems will use the same techniques to talk to each other.

MELODIA: He's trying to communicate to this guy.

CARROLL: Modems transmitting data from underwater to a modem on the surface, then to a laptop and to a cell phone anywhere in the world.

Did you get names?

MELODIA: We did. For a specifically experiment in which we have one of the yellow spears called Alice who wants to communicate with Bob.

CARROLL: Then it's into the water.

So what happens now?

MELODIA: So this will send a message underwater, and Bob will transmit these data to the Internet.

CARROLL: After a few moments, a message. First via laptop --

Welcome, CNN.

Then the mobile.

HOVANNES KULHANDJIAN, PHD STUDENT: This is the message I was waiting for. So when everything works, we're like, kind of, whew! That's it. We got it.

CARROLL: Today Lake Erie, soon, hoping the Internet will finally go where no Internet has gone before.

(END VIDEOTAPE)

CARROLL: The research is partially funded by the National Science Foundation. Melodia's team presented their work at a conference in Taiwan last week, and, as can you imagine, Christine, it was really well received, very exciting stuff.

ROMANS: Looks cold out there, but testing the technology.

CARROLL: A little cold out there.

ROMANS: Thanks, Jason's.

See you next Saturday at 9:30 a.m. Eastern. Have a great weekend.