No Double-Dip Recession Expected; Enhanced Pat Downs
CHETRY: Glass half empty, glass half full. That's what we're talking about today, as we figure out whether or not our economy is heading in the right direction. It may not feel like it to a lot of Americans, but apparently there are some good news on the economic front because leading economic forecasters now say that there will not be another recession what they call a double-dip any time soon.</s>VELSHI: But if things aren't getting worse, the question a lot of people have, are they getting better? If they are, when are we going to start to feel like it's getting better? So let's bring in Lakshman Achutan. He's the economic analyst and managing director with the Economic Cycle Research Institute and, of course, Christine Romans with us, as well. Welcome to you both.</s>LAKSHMAN ACHUTHAN, ECONOMIC ANALYST: Good morning.</s>CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Good morning.</s>VELSHI: So Lakshman has told us --</s>ACHUTHAN: Yes.</s>VELSHI: -- and you've written an article that is on on Money.com that your research -- and you do this for a living and you have for a quarter century, your company -- indicates no double-dip recession. That's the part we're celebrating?</s>ACHUTHAN: Yes, the news is, the forward-looking longer leading indicators of the economy. So not what's going on now but what's going to happen in the future. We've been able to rule out this fear of a double dip. And we've been talking about it for months now. All summer, people have been worried as the economy has faltered that we might have a return to recession.</s>VELSHI: Right.</s>ACHUTHAN: And what we're saying here is categorically that is not going to happen. We're not slipping into recession now or any time soon. And so that is one part of this whole kind of nightmare scenario that we can push aside.</s>VELSHI: Why does Christine look so stern?</s>ACHUTHAN: Yes.</s>ROMANS: Because it means that if you're not moving forward in the economy right now, it doesn't necessarily mean you're going to start moving forward. It means we're not going to, according to your research, have another recession or double dip, but it means that if you are sitting at home and it feels like a recession to you, there are no indications that things are getting better tomorrow or next week.</s>CHETRY: And that's the question, Lakshman, that we're wondering about as we keep reading these stories piece meal. I mean, one, of course, is the unemployment. The high unemployment that we haven't seen tick down at all.</s>ACHUTHAN: Yes.</s>CHETRY: The other one is this reporting that, you know, you have companies sitting on extremely large amounts of cash. $1.3 trillion, one of the estimates, in cash, yet they're not hiring and it doesn't seem that, you know, we're doing the things that will bring us back to prosperity.</s>ACHUTHAN: Well, OK, so to Christine's point first. We are going to continue slowing. We started to slow a couple of months ago. That's going to continue this year and into next year. So saying no recession is very good --</s>VELSHI: -- continue to slow, not go backwards.</s>ACHUTHAN: Exactly. So we're still making progress. We're still in the recovery room. We're not going back into the operating room. OK. So it's not going to get really bad. But we're still in the recovery room, we're not out of the hospital. And when you talk about businesses holding on and hoarding all these cash, it's a lot, it's about confidence. A lot of it is about the fear of a double dip. Because the companies that are hoarding the cash today are the ones that didn't fail during the recession and they're scared.</s>ACHUTHAN: In a way, the good news if we're not having a recession, they're going to still have the demand coming in the door. You're still going -- so we're going to see GDP and production numbers. They're going to get weaker, jobs numbers may even get a little weaker. They're not going to go negative. That is the key take away from all of this.</s>VELSHI: OK.</s>CHETRY: The scariest thing for me, Christine, and I brought this statistic to show you, this federal report earlier this month showing that one out of 34 Americans who had a job in 2008 earned zero income in 2009. And when you take it altogether and you take into account all, you know, underemployment, et cetera, you could be looking at a 22 percent or higher unemployment rate.</s>VELSHI: We're going to have a chance to make those decision next week. A lot of people will cast their ballots based on whether they should be extensions to the unemployed. And there are choices to be made. You can look at how the U.K., the conservative government in the U.K. has decided that they're about austerity, pulling back, government not spending as much versus the Obama administration, which is saying this is the wrong time to be pulling that back. Stimulus versus austerity. A lot of people don't know that's the decision they're going to be making at the ballot box. But it kind of is.</s>ACHUTHAN: Well, it is and you know they're making this gut emotional decision and they don't feel good, right? because we haven't recovered what we made from the recession. So they want to react to that. However, even if you were to implement either of these policies now, it wouldn't make a difference in the coming year. It changes the contours of the playing field. The economic playing field years down the road, not any time soon. So you know, we have our emotional --</s>VELSHI: That's a good point. You're going to the ballot box mad because somebody told you they're going to cut deficits and cut taxes or continue spending, but the ultimate effect on the economy immediately is --</s>ACHUTHAN: Nothing. Pretty much nothing.</s>VELSHI: Lakshman, good to see you.</s>ACHUTHAN: Thank you. And at least good news, glass half full at this point.</s>ROMANS: No double dip.</s>ACHUTHAN: No double tip.</s>ROMANS: Lakshman.</s>CHETRY: Maybe that'll help with the confidence and help bring us the cash.</s>ACHUTHAN: Exactly.</s>CHETRY: Thanks, Christine, as well. 33 minutes past the hour. Right now, time for a look at our top stories.</s>VELSHI: Florida Senate candidate Kendrick Meek denies reports that former president Bill Clinton tried to convince him to drop out of the race. We spoke to Meek last hour, he insists he is in the race to win it.</s>CHETRY: Also developing now, the North Koreans reportedly firing two rounds at a South Korean military unit near the border, which separates the two nations. The DMZ (ph) on the South Koreans fire back, according to news reports out of Seoul. No word of any casualties.</s>VELSHI: President Obama may be softening his opposition to same- sex marriage. Earlier this week he told a group of liberal bloggers "attitudes evolved including mine." The White House spokesman said the president has been discussing the issue with colleagues and co- workers who share their stories about being singled out for being different.</s>CHETRY: Well, on the CNN security watch now. It's an alternative to those revealing full-body scanners. Airport security procedures will be more hands on. The TSA currently phasing in new procedures calling them enhanced pat downs. Some people say the new searches are too invasive, that they allow contact with body parts that are previously off limits and it's not sitting well with some. Homeland Security correspondent Jeanne Meserve is live at Reagan National Airport for us this morning. First of all, explain what they mean when they're talking about these enhanced pat downs, Jeanne?</s>JEANNE MESERVE, HOMELAND SECURITY CORRESPONDENT: Well, probably, Kiran, the best way for me to describe this is to tell you the story of Rosemary Fitzpatrick, who says she felt humiliated and violated by this procedure. Rosemary is a CNN employee. She is also a frequent traveler. She was flying through Orlando on Wednesday night when her underwire bra set off a metal detector. They didn't have advanced imaging technology, those body scanners, so screeners told her she would have to undergo this new pat down procedure. She said "they touched her breast area. They ran their hands over her buttocks, through her inner thighs and even briefly touched her crotch." Here's her thoughts.</s>ROSEMARY FITZPATRICK, FLIER: Just the thought of having my parents who are in their 70s be subject to this type of behavior and screening is appalling to me. Even children who are traveling alone. I can't imagine children having to be put through this type of a process.</s>MESERVE: The Transportation Security Administration says this is about security. They issued a statement saying pat downs are one important tool to help TSA detect hidden and dangerous items such as explosives. Think, for instance, about that underwear bomb carried by Umar Farouk Abdulmutallab sewn right into his underwear. The thought is that perhaps a pat down like this might be more apt to detect an explosive like that. Kiran, Ali, back to you.</s>CHETRY: All right. Who is going to be getting these enhanced pat downs?</s>MESERVE: Well, the TSA says a very small number of travelers in the end will end up getting these. There's some specific categories that would be subject to them. Specifically, they'll be used on people who refuse to use those body scanners, the advance imaging technology. They'll be used to resolve anomalies that show up when someone goes through one of those body scanners. Also, to resolve alarms that go off when people go through metal detectors. And also they'll be used on people picked for random screening. So they say the percentage of fliers going through this will be relatively small. They'll always be done by same-sex screeners. And if a passenger wants to, they will be done in a private screening area. That wasn't much comfort, however, to Rosemary Fitzpatrick, who says she will be doing a lot less flying because of this new pat down procedure. That's how discomforted she was by this. Back to you.</s>CHETRY: All right. Jeanne Meserve for us this morning at Reagan National. Thanks so much. I love this e-mail we just got from one of our colleagues who shall remain nameless. He goes, "here's your choice, guys, the porn x-ray or fondling."</s>VELSHI: Right. It's somehow they're going to find out more stuff about you. And you make that choice.</s>CHETRY: Yes. Friendly skies get even friendlier.</s>VELSHI: Yes. No kidding.</s>CHETRY: Well, coming up. Politics, Comedy Central style. We're going to preview this weekend's dueling D.C. rallies headlined by Jon Stewart and Stephen Colbert. Oh, sorry, Ali, I forgot