Obama Continues Adding to Cabinet; First Lady Talks Education; Venezuala President Reaches Out to Washington; Macy's Cuts Jobs as Mattel Announces Major Drop in Profits
KIRAN CHETRY, CNN ANCHOR (voice-over): Hard sell.</s>ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: You've got a piece of legislation that creates jobs.</s>CHETRY: Barack Obama spending political capital on a plan that's getting closer to a trillion dollars. Plus, Hill rips on Bill.</s>HILLARY CLINTON, SECRETARY OF STATE OF THE UNITED STATES: I am so grateful to him for a lifetime of all kinds of experiences.</s>CHETRY: The new secretary of state cracking jokes and getting down to business. Today, her first high-level talks on this AMERICAN MORNING.</s>CHETRY: Good morning. Welcome, it's Tuesday, February 3rd.</s>JOHN ROBERTS, CNN ANCHOR: Good morning to you. It's an interesting way to put it, isn't it?</s>CHETRY: Yes.</s>ROBERTS: Thanking him for a whole range of experiences not mentioning any of them. Thanks for being with us this morning. President Barack Obama reaching across the aisle today to name New Hampshire Senator Judd Gregg as the secretary of commerce. The president is going to announce the nomination in just a few hours. Gregg is known as a fiscal conservative. He would be the third Republican in Obama's cabinet. A deal struck with New Hampshire's governor, John Lynch, will keep Gregg's seat out of Democratic hands and not affect the balance of power in the Senate. Sources say Gregg's former chief of staff, Bonnie Newman, will be named to replace him. This morning, Eric Holder will be sworn in as the new attorney general. He'll be the country's first African-American to hold that post. The Senate confirmed Holder yesterday by a vote of 75-21. The vote came after some Republicans tried but failed to get Holder to pledge that he would not prosecute intelligence agents who used harsh interrogation tactics. And a soldier in South Carolina was in the middle of his first- ever skydive when the instructor strapped to his back died of an apparent heart attack. Daniel Pharr said that he went into survival mode and used his army training to steer the chute and land safely.</s>PVT. DANIEL PHARR, SURVIVED SKYDIVING SCARE: I was asking him what his longest glide was before, you know, just general skydiving questions and he was unresponsive. So I just grabbed the right toggle, tried for the left toggle, and in doing so lost the right now. So I regained the right one and just held on to it. And my path was such that I was going toward a house, so I just pulled on the toggle and turned right.</s>ROBERTS: Pharr attempted CPR but it was too late. Officials are waiting for autopsy results. The young man was fortunate that the parachute was already open when his instructor died.</s>CHETRY: Well, right now the clock is ticking for President Obama's stimulus package. He wants to sign it by President's Day. It's less than two weeks from today. But can the differences be worked out by then? Today, the Senate is going to be voting on a number of amendments to the bill after the House passed an $819 billion package last week with no Republican support and the president will reset the focus on his economic plan today when he sits down with more number of interviews with major networks. He's going to be speaking to our Anderson Cooper as well. His message, no doubt, will be minor differences should not slow down the bill.</s>BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Every day it seems there's another round of layoffs, another round of jobs lost and family's lives turned upside down. We lost 2.6 million jobs last year and another 2.8 million people who need and want full-time work had to settle for part-time employment. So this is a difficult moment. But I believe if we act boldly and swiftly, it can be an American moment when we work through our differences together and overcome our divisions to face the crisis.</s>CHETRY: And this morning we're going to be on the headlines breaking down this stimulus bill, what it means politically and also what it means for your paycheck. We have Christine Romans for us. We start, though, with Suzanne Malveaux. She joins us in New York this morning. The Democrats are already making some concessions. They've taken some things out of the bill that the GOP identified as pork. Will that be enough?</s>SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: I don't think it's going to be enough. I mean, you have President Obama. He's behind the scenes. He's meeting with Harry Reid and Nancy Pelosi yesterday and obviously they're looking at this millions of dollars. And this package is $900 billion so far and the problem is they're still dealing with the millions here. You have the smoking, the antismoking programs. It's like $675 million. You've got 400 million for HIV and AIDS prevention, that type of thing. They have got to cut out a huge portion of this in order to win Republican support and they're not even close yet. You've got House Republicans who are talking about millions to the Smithsonian Museum. You've got furniture for Homeland security, those type of things. They say this is waste, but they also have like 125 million for D.C. sewage and for someone who lives and works in the D.C. area, that to me that's not pork.</s>CHETRY: That's not pork.</s>MALVEAUX: That's necessary. I want to see that kind of spending, but they're saying that doesn't create jobs so you've got to take it out.</s>CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: They're all distractions, though. I mean that's -- they're big distractions and a lot of people tell me that those millions are distracting from the credibility of the billions that you're trying to spend. And so it's an interesting point. You've got these little projects that seem to be the thing that are getting all the headlines but this is $900 billion package. It's huge. It's so big it's almost impossible to understand how much money that is. So I think that the distraction and the credibility issue is what comes from these little projects that seem great to, you know, Suzanne who lives in Washington, D.C. who wants to see the sewage updated.</s>MALVEAUX: And the other problem too is that Barack Obama, he campaigned on changing the world, you know, on promising the world here and so the expectations are so high. He's talking about your kids are going to be able to afford to go to college. They're going to be able to afford their health care. They're going to be staying in their homes. All of these things, he has to deliver on this. And so you're not going to have this as part of an economic stimulus package. There has to be some sort of other plan beyond this where he is going to be able to deliver. At least say I'm trying to deliver on all of these things that I said I would do during the campaign, and that's a real challenge for him.</s>ROBERTS: So the Democrats want spending. The Republicans are saying too much spending. We want more tax cuts. So - but in terms of, you know, breaking it down and what the numbers mean for people's paychecks at home, what are these tax cuts going to bring to the average American?</s>ROMANS: Well, the tax cuts are about the third of the House package, and the Senate package is a little bit more because they put on this AMT release. So that's the millionaire tax, the middle-class Americans get that they shouldn't get - this big AMT tax. So Chuck Grassley wants that out. But basically the tax cuts as they stand right now in your paycheck would be about $20 a paycheck for this year and $10 a paycheck for next year, up to $500 if you make $75,000 or less or $150,000 or less for couples. So for middle-class workers, even upper middle-class workers, there is going to be some relief in there. There are some other tax cuts as well. Now the case for these tax cuts is a big, big fight. It helps low and middle class families. It's an immediate boost to the economy. These are likely to be spent. But the case against them, a lot of Republicans say these cuts don't go far enough, that some people might actually save them, not spend them. And in fact in some cases it gives money to people who don't pay income tax. That's something that political conservatives are very concerned about, people who do pay Medicare and Social Security taxes but not income tax. So that's what...</s>ROBERTS: And President Obama says they are in effect tax breaks because they're being...</s>ROMANS: Right. And he says that's -- you know, that's not nonnegotiable. He's not going to work on that one.</s>ROBERTS: Right.</s>ROMANS: So, you know, that's where the tax fight comes from. But I wanted to, real quickly, I have to move down (ph) from Mark Zandi. This is what he says about how important tax cuts are to this package.</s>MARK ZANDI, CHIEF ECONOMIST, MOODY'S ECONOMY.COM: Tax cuts are a good way to get money into the economy quickly. The tax cuts we're talking about in this plan would get into the economy this summer and fall when the economy desperately needs it. So it's a fast, quick boost to the economy.</s>ROMANS: So as soon as the government and your company can start to change these withholdings, it would be about 20 bucks in your paycheck, 10 bucks in your paycheck. Maybe next year up to 500 bucks. So...</s>CHETRY: You were talking about all these billions. It's interesting the Republicans are putting forth in the Senate, their own proposal. It's only about 100 million less than the Democratic proposal. I mean, it's like $718 billion.</s>ROMANS: That's right.</s>CHETRY: Billions, sorry. I keep saying million instead because it's just the numbers are so huge. Also, very interesting with so much of the president's attention focused on the economy, we're also talking about First Lady Michelle Obama. She stepped up to address other domestic priorities. One, education. Mrs. Obama talked to staffers at the Department of Ed on Monday, her first stop on a listening tour of government agencies.</s>MICHELLE OBAMA, FIRST LADY OF THE UNITED STATES: I am a product of your work. I wouldn't be here if it weren't for the public schools that nurtured me and helped me along. And I am committed as well as my husband to ensuring that more kids like us and kids around this country, regardless of their race, their income, their status, the property values in their neighborhoods get an access to an outstanding education. The children of this country are counting on all of us. They're looking to us for direction. They're looking to us for that ray of hope. They're looking to us to help them figure out how to make it through. And we have everything we need right here and now to make that happen.</s>CHETRY: We're talking more with Suzanne about this. As you said, a lot of promises made, you know, through this administration and when Barack Obama was campaigning. And his wife also talked about that, Michelle Obama saying every child deserves a great education.</s>MALVEAUX: And she talked about being the "Mother in Chief," especially when they were campaigning, that that was going to be her role, and obviously looking out after Sasha and Malia. But I think she's also going to become kind of the neighborhood mom as well. I mean, we've seen both of them reach out to people in Washington, D.C. We see them with the mayor, Adrian Fenty. And it's funny because my dad works at NBC and actually he was trying to decide which place he was going to go to lunch and it was either Georgia Brown's or D.C. Coast. They chose D.C. coast. He's like, oh, I just missed Michelle Obama. She was at Georgia Brown's. He looked so excited he just wanted to bump into her and to see her. And I think you have that kind of that sense of excitement of people in the nation's capital. For the first time, they really feel that they're a part of the White House and what's going on at 1600 Pennsylvania. And so you see her doing this kind of community outreach things. I think you're going to see more of that type of thing. It's going to be informal settings. I mean, she'll go out to the department agencies obviously but she's also just the kind of person who's going to, you know, pop up at, you know, Georgetown or at a local school or Georgia Brown's and I think that really is creating a sense of community.</s>ROBERTS: We'll see how long they can keep it up because that bubble tends to envelop you and draw you in.</s>CHETRY: And the other interesting thing she was speaking at the Department of Education. Meanwhile, Sasha and Malia go to a private school. They go to a Friends school. They're not a product of a D.C. school system. She made a point of saying that she was.</s>MALVEAUX: And I think she needs to. I mean, I think she needs to make that point because obviously she went to public schools but then she went to Ivy League schools. Both of her daughters have been pretty much, you know, sheltered in that sense from the public school system. They need to show that yes, they are reaching out to those who are going to D.C. public schools. That they understand some of the challenges that D.C. faces.</s>CHETRY: Suzanne, great to have you with us here on the set. Thanks so much.</s>MALVEAUX: It's nice to be here.</s>CHETRY: Christine, thanks as well.</s>ROMANS: Thanks.</s>CHETRY: And a quick reminder, CNN's Anderson Cooper sits down for a one-on-one interview with President Obama. It's today. It's at the White House. You can see it on "AC 360" tonight, 10:00 Eastern time right here on</s>CNN. ROBERTS: Venezuela's president, Hugo Chavez, has long been a thorn in Washington side. But is the man who called former President Bush the devil ready to make nice now? Hear what he has to say in an exclusive interview. That's straight ahead. And Senator Hillary Clinton paying tribute to her husband during a ceremonial swearing in. Hear what she said that had the crowd laughing. And the former president, as he is known to do on occasion, turning bright red. It's 10 minutes now after the hour.