Afghanistan Wants You; Financial Bailout Report Card
ROBERTS: Welcome back to the Most News in the Morning. When they stand up, we can stand down. You heard that in Iraq where a national security force is now taking hold. And now, in Afghanistan. Yesterday General Stanley McChrystal told Congress that training tens of thousands of additional capable Afghan soldiers is crucial to American success in Afghanistan. But the biggest fight with the enemy may be for the people's loyalty. Our Atia Abawi is live for us. She's in Kabul, Afghanistan this morning with this AM Original. Good morning, Atia.</s>ATIA ABAWI, CNN INTERNATIONAL CORRESPONDENT: Good morning, John. Well, the clock is ticking on President Obama's plan to start handing over greater responsibilities to the Afghan forces. The plan is to actually increase the Afghan National Army, up to 134,000 troops by October of 2010, when we actually went on the streets of Kabul with the army recruiters to see what kind of progress they're making.</s>ABAWI (voice-over): Cold, desperate and hungry -- the perfect recruits. Recruits that the Taliban want, but these men are being drafted by another group. Every morning the Afghan National Army, known as the ANA, heads to the streets of Kabul looking for potential soldiers. Some are willing. "We want to be of service, spend our time working in Afghanistan," says Korm Omad (ph), "so we don't have to wander around in other countries like Iran or Pakistan looking for work." But others are not so interested. "They wouldn't give me a good enough salary to join the army," Nakeeb (ph) says. "My job is better than being a soldier. At least I wouldn't be harassed here." The government recently increased the pay of soldiers and police by 40 percent, enticing men who are struggling to provide for their families. Soldiers can make as much as $250 a month if they are in the heat of battle, in the hot spots of the Afghan war. It's not going to make them rich, but at least it's steady money, although less than what some Taliban groups will pay. The ANA is doing everything it can to enlist, going to the streets and the airwaves. But it's a long way to this from this.</s>ABAWI (on camera): Despite the disheveled an unkempt appearance, doctors say that these men are fit to fight. Out of the 1,500 who have come through this processing center in the last couple of days, only 25 were rejected on medical grounds.</s>ABAWI (voice-over): These men are going through a life-changing experience. Most of them can't read or write, let alone understand what they're doing today with the physicals, biometrics and paperwork. The question remains -- is this more about quantity rather than quality? President Obama has stated that he expects the ANA numbers to grow up to 134,000 by the fall of 2010, taking some of the burden off the international forces in the country. And Afghan commanders say they will do just that, not because the Americans want them to, but because eventually they want to take charge of their own land. "This was something that was started by our forefathers," Colonel Hakim (ph) says. "We have to protect our own country."</s>ABAWI: The highest paid private in the battlefield here in Afghanistan gets around $250 a month, and that comes after a pay raise. Let's compare that to the other groups. General Stanley McChrystal yesterday testified that some Taliban groups are paying their fighters at least $300 a month, and there's private security companies here paying $500 a month. Now, the question that remains is if you're a starving Afghan desperate to feed his family, what option will you choose? John.</s>ROBERTS: More battle for wallets than hearts and minds. Atia Abawi for us in Kabul this morning. Atia, great report. Thanks so much.</s>CHETRY: Coming up on half past the hour right now, a look at your top stories. Congressional investigators say the Food and Drug Administration has failed to follow recommendations to improve the way it monitors the safety of prescription drugs. Those recommendations were made three years ago after the FDA was forced to pull the painkiller Vioxx off of the market for links to heart attacks and strokes. A government report says the FDA still relies too heavily on scientists who approve drugs instead of those who monitor their side effects.</s>ROBERTS: Iran threatening a tougher crackdown against protestors, tens of thousands of students taking parts in demonstrators since Monday. Police and pro-government militias storming crowds, firing tear gas. More than 200 people were arrest in Tehran. Iran's top prosecutor says further unrest will not be tolerated.</s>CHETRY: And a steady stream of immigrants giving many of the nation's cities a population boost, a new study by the Brookings Institution says that keeping the numbers in places like L.A. and New York from falling as more native-born Americans move inland looking for jobs and more affordable housing. It could also keep states like California, Illinois and New York from losing a seat in the House of Representatives. Well it's been more than a year since President Bush signed off on the $700 billion federal bailout known TARP. It was a risky investment. The big banks that were starting to pay taxpayers back, but what about Main Street's problems? We're still dealing with double digit unemployment and one in eight homes in some stage of foreclosure. Also the small businesses, these are the places that hire, they're caught in a lending crunch. Joining me now to talk more about all of this, Elizabeth Warren -- she is the chair of the Congressional Oversight Panel for TARP, also a professor at Harvard Law School and her panel will be releasing their latest report about TARP today -- Elizabeth thanks for being with us.</s>ELIZABETH WARREN, CHAIR, CONGRESSIONAL OVERSIGHT PANEL FOR T.A.R.P.: Thank you for having me.</s>CHETRY: So you're going to be appearing before Congress to talk about TARP today. What do you plan to tell Congress regarding whether or not this program has been a success?</s>WARREN: Well, we're going to start out with the fact that the program in one sense has been a huge success. Remember where we were a little over a year ago. The economy seemed to be hurdling toward the abyss, depression looked like it was in our future and TARP was an important part of a strong government response, along with the Fed, along with the FDIC, and along with the stimulus package. It held up a big sign to America and to the rest of the world that said, in effect, we are not going to let our economy collapse. Things calmed down. The markets stopped plunging. People got some confidence and so we began to stabilize. So in that sense TARP gets a real thumbs-up. Now the problem of course is that TARP was not designed solely to pump up a bunch of large financial institutions. That was supposed to be done in order to deal with other problems in the economy...</s>CHETRY: Right.</s>WARREN: ... with foreclosures, with lack of credit to small businesses.</s>CHETRY: And let me ask you a little bit about that because the report out today from your panel suggests that while TARP has been good for Wall Street not necessarily for Main Street, that just five percent of TARP money has actually gone to help small business and consumer lending, so why the lag in those areas?</s>WARREN: You know, we evidently got very, very good at shoveling hundreds of billions of dollars into large financial institutions, pretty much on a no-questions-asked basis. But when it came to putting money on Main Street, when it came to dealing with mortgage foreclosures and small business lending, boy, it was hard to turn loose at the nickels. And it just quite frankly just hasn't happened in anything like the way it happened for Wall Street.</s>CHETRY: And that's the question a lot of people have. There are a few articles that are out today questioning whether or not it sends the message that too big to fail means you can keep doing what you're doing at these big banks and the government will bail you out. However, if you're one of these smaller banks and you're in competition and you have with the big banks, plus you have all this exposure to the homeowner situation and to the credit crunch, we're going to let you fail. A hundred and thirty banks so far this week, some of the small regional banks that are responsible for lending to small businesses, out of luck. What can we do to change that or what message are you going to send today about how that should change?</s>WARREN: Yes. Well, first thing we want to do is exactly what you said, and that is highlight that we're all standing around celebrating, Bank of America is going to pay back, other large institutions have paid back the money. And sure, it's good to get the money back. But what they're not giving us back is the implicit guarantee. That is, if they get into trouble in the future, what most investors believe is that the taxpayer will be forced to rush back in and rescue them. And that causes real problems in the economy. It makes it cheaper for them to attract investments and it makes them take on riskier investments than they otherwise would. So what this really means is that what's going on, on Capitol Hill, what we call regulatory reform...</s>CHETRY: Right.</s>WARREN: ... building the failure part of the system, what I think of as the bankruptcy part of the system, it's called resolution authority, building that part of the system, the system that will put us in a position where we can credibly say, if you mess up badly enough, you can be liquidated.</s>CHETRY: Right.</s>CHETRY: But you know what, a lot of people have the question why didn't we do this when we -- when they were much more willing to listen because they needed taxpayer money to remain viable to even be a business? Now we're trying to say it after the fact.</s>WARREN: It is the right question. There is a deep eye-ringing (ph) in the fact that we pumped billions of dollars into these large financial institutions and they are now spending substantial amounts of money lobbying Congress to make sure that the rules are not changed. We seem to have a perfect circle here that always benefits the large financial institutions and not the American family.</s>CHETRY: I know you're going to talk about that a little bit later today when you go before that -- the congressional committee, but also I want to touch on the rising foreclosures. You mentioned them as well. You said that we could see as many as 13 million foreclosures, yet under TARP lenders modified 10,000 mortgages, 13 million foreclosures possibly in our future, 10,000 mortgages. Why hasn't this huge problem been tackled more effectively?</s>WARREN: Well, we've been raising concerns about the foreclosure portion of the TARP plan almost from the beginning, and our deepest concerns are that the program itself is just misdesigned. That it can't scale up, that it doesn't have the kind of scope it needs, and that it doesn't provide permanent solutions to the problems but just kicks the can on down the road. We have a program right now to deal with foreclosures that largely is directed toward the subprimes that were going into default about a year ago. So it's a program to fix the problem as it existed back then and not a program to deal with the problem as it exists now.</s>CHETRY: Right.</s>WARREN: And that is frankly we didn't get ahead of the problem, the mortgage foreclosure problem back then and get it stopped so what it's done is it's ballooned. And it's gone out into prime mortgages. It's gone all the way across the country, and it keeps getting larger. And the government response is simply not big enough, not fast enough.</s>CHETRY: Right and so real quick before we let you go, there's talk of possibly expanding TARP, taking it to 2010 with the purpose of using it to help homeowners and to free up credit for small businesses. Do you know anything about that, about whether or not the administration is going to push to continue it?</s>WARREN: Well I think that that will be an announcement that will be coming soon, whether or not Treasury is going to do that, but, you know, if they do make this announcement, that gives us a good moment to pause and evaluate TARP. If we make the decision, if the secretary of the Treasury makes the decision to go forward, it can't be TARP as usual. It needs to be that we back up and get some real focus on the programs that will help Main Street. Without that, we should not be spending TARP money.</s>CHETRY: All right, Elizabeth Warren, great insight this morning, Congressional Oversight Panel chair. Thanks for being with us.</s>WARREN: Thank you.</s>ROBERTS: Told you a difficult story on Thanksgiving Day about a school where a lot of students were coming in, they didn't have enough clothes to wear. They didn't have enough food to eat. Well CNN viewers make a difference. Wait until you hear what's going on there now. And coming up in less than a half an hour's time, former Vice President Al Gore, he's headed to the Copenhagen Climate Conference next week, but first of all he stops by here on the "Most News in the Morning" to tell us what he thinks will happen during the climate conference and what about all of those e-mails from the Climatic Research Unit, Climategate, what kind of an impact will that have on public perception of the science? Al Gore coming up right up, it's 39 minutes after the hour.