>> get out. get out now. >> who's terrorizing who in that interview? jeanne moos, cnn -- >> al qaeda is so 2001 -- >> reporter: new york. i'm wolf blitzer in "the situation room." up next, "lou dobbs tonight." tonight, more on congressional democrats who now say cia director leon panetta told them the agency has been lying to congress for years. republicans say the democrats are playing partisan politics, trying to protect house speaker nancy pelosi. also tonight, a new push for another stimulus passackage, ev though unemployment is still rising and only 10% of the first stimulus funds have been spent. a panel of top economists join us here tonight. and the obama administration moving ahead to introduce comprehensive immigration reform. the white house also now promising to tighten border security. first tonight, congressional

democrats are claiming the cia routinely lied to congress and they say cia director leon panetta backs their claim. republicans don't see it that way. they're accusing democrats of putting partisan politics ahead of national security. their dispute revives the controversy over charges made by house speaker pelosi that the cia lied to her about its use of waterboarding. brianna keilar reports from capitol hill. >> reporter: to hear democrats tell it, the cia has been keeping congress in the dark for the last eight years. >> what does this mean? >> it means that something very serious broke down. >> reporter: anna eshoo and six other democrats on the house intelligence committee say cia director leon panetta himself revealed that the cia misled members of congress. in a letter to panetta they say, you determined that top cia officials have concealed

significant actions from all members of conditioning and misled members for a number of years. >> he informed us that there was an operation that was in place from 2001 until the day before he came to notify us. >> reporter: but pete hoekstra, the committee's top republican, downplayed the significance of panetta's briefing. >> i heard about a concept and a plan and some preparation on a program. a program that was never implemented. >> democrats and republicans wouldn't give specifics, because they say the information is classified. but house speaker nancy pelosi, who's already weathered republican criticism for accusing the cia of misleading members of congress, was less than eager to way in on the debate. >> the fact is is that there is a briefing that is of serious concern to members of the committee and they have their course of action to deal with it. and that's that.

>> reporter: house republican leader john boehner said the new information does not vindicate pelosi. >> i do not believe that the cia lied to congress. i'm still waiting for speaker pelosi to either put up the facts or retract her statement and apologize. >> reporter: one point about the timing of all of this, lou, the house is ready to take up a significant intelligence agency bill. this is an opportunity for republicans to attack speaker pelosi for what she said about the cia, so what you have here is democrats essentially launching a preemptive strike, lou. >> and launching it against a democratic, former democratic congressman, a democratic cia director. this is peculiar, to say the least, for a party in control of the executive of the legislature to be taking on one another. >> reporter: the other interesting thing, lou, is that this bill that the house is poised to pick up, there is a

provision that would extend the number of members of congress that get intelligence briefings, like the one that nancy pelosi raised in 2002. and there was a veto threat out from president obama on this. so you can see democrats are at odds over that as well. >> any suggestions that there will be hearings with all of these charges flying around capitol hill? >> reporter: at this point, the house intelligence committee has not said that they are going to launch an investigation, but it's certainly thing some of these democrats we're talking to are pushing for. the controversy over whether the cia lied to congress is the subject of our "face-off" debate tonight. darrell issa and adam smith join us here on the broadcast. another debate, just beginning in washington tonight. a debate about whether this country needs a second economic stimulus package. only a fraction of the president's original $787 billion stimulus package has been spent so far, but there are

voices within and outside the administration now floating the idea of another massive federal economic recovery plan. kate balduan with our report. >> our great vice president, joe biden. >> reporter: the man president obama calls the sheriff, pounding the pavement from new york to ohio, crisscrossing the country, defending the stimulus package. >> remember, we're only 140 days into this deal. this is supposed to take 18 months. >> reporter: but now, five months since the recovery act took effect, some democrats and economists are talking possible stimulus round two for the obama administration, quickly fueling partisan fire. republicans say that would be repeating a huge mistake. >> the bottom line is this. the stimulus isn't creating enough jobs. >> reporter: meanwhile, house speaker nancy pelosi is calling for patience and predicting results. >> i don't think it's been given all the time to work, this third

quarter is a big quarter for the stimulus. and i think that people will begin to see more of the result. >> reporter: so where do things stand? according to the white house budget office, $158 billion of the $787 billion is committed, but washington has so far distributed about $57 billion. numbers and a time line that some economists say mean it's still too early to tell if yet another stimulus jolt is needed. economist mark zandi has advised congress and the administration on the stimulus plan. >> i really do think it will be october, november, december before we have a clear sense of how well this is working. the maximum benefit to the economy really won't occur until later this fall. >> and zandi says he may have to wait until early next year to gauge success. if the economy is still struggling then, he says new

stimulus could provide new money to state governments as he predicts budget problems only to get worse there and also, lou, more help for taxpayers, like a temporary payroll tax holiday. >> kate, thank you very much. we'll have a lot more on the economy and the stimulus package or packages with views from coast to coast. joining us will be the governor of pennsylvania, ed rendell, and two members of congress, democratic congressman loretta sanchez, republican congressman brian bilbray will join us. at the g-8 summit, world leaders agreed to work together on climate change. the president announced that deal today, setting a target of cutting carbon monoxide emissions by 80% over the next 40 years, initially. china is not bound by the agreement and some changes had to be made. critics in the united states saying the deal would have put the united states at a competitive disadvantage. a series of new polls show the american people losing confidence in the president's

ability to lead the country out of recession. 43% in the latest poll say the president is doing a poor job of handling the economy, that's the new rasmussen poll. 39% say the president is doing well. those are his lowest numbers yet on the economy. the most recent gallup poll finding that president obama's overall job approval in june dropped to 61% from 65% in may, still a strong number. and a new cnn opinion research poll finds fewer americans now believe the president has a clear plan to solve the nation's problems. 53% saying the president does have a plan. that's down from 64% in february. turning now to iraq, where a series of bomb attacks over the past two days have killed more than 60 people. this is the worst violence since u.s. forces pulled out of iraq cities nine days ago. a double suicide bombing in the northern city of tal afar today killed 35 and wounded 65 others. bombs also targeting a police

patrol in kirkuk and a marketplace in baghdad. in iran, security forces there today using clubs and tear gas, breaking up street demonstrations and protests. those demonstrators marking the tenth anniversary of the student uprising that led to the growth of iran's opposition movement and the overthrow of the shah. these videos posted on youtube today, cnn could not confirm the locations nor where they were shot. up next, the controversy over stem cell research. new york becomes the first state to use public money to pay women for their eggs. also, congress tackling the issue of illegal immigration and the impact of mexican drug cartel violence in this country. a group of black and hispanic children were thrown out of a swimming pool in southern philadelphia. the apparent racist act shocking kids and anyone who lives in 2009.

you know, marcus, i see tears coming down your face. why does this make you cry? >> because it's kind of like sad that like people are still thinking like this. when i thought that it was over. >> that story is next. you're the colon lady! diarrhea, constipation, gas, bloating. that's me! can i tell you what a difference phillips' colon health has made? it's the probiotics. the good bacteria. that gets your colon back in balance. i'm good to go! phillips' colon health.

congress today began dealing with two issues, mexico's violent drug cartels and illegal immigration. the senate is now preparing legislation on comprehensive immigration reform and a house committee today hearing dramatic testimony on the threat that mexico's drug cartels pose to the united states. lisa sylvester reports. >> reporter: drug-related killings in mexico are surging to unprecedented levels. 6,200 killings last year, up from 1,200 in 2006. two americans, including an anti-crime activist, who lived in northern mexico, were killed this week. it's believed they were murdered for taking a stand against local drug lords. >> this past june was the deadliest month on record with over 800 killed in drug-related

violence. in short, in mexico, drugs and violence are a growth industry. >> reporter: at a house oversight committee meeting, lawmakers said the borders have allowed drugs to move north into the united states with guns moving south. the obama administration is considering sending national guard reinforcements to the border as a security measure, but a final decision has not been made. separately, the senate approved an amendment to complete 700 miles of double-layered fence between mexico and the united states by the end of next year. it still must clear the house and be signed by the president. >> in this world today, where we're threatened in many, many ways, it is critically important that we're able to determine who comes and goes and what comes and goes on the borders of the united states. >> reporter: the who and what are elements of a long-delayed comprehensive immigration reform favored by members of both

parties. at least one key democrat, senator chuck schumer, agreeing with republicans that ending the free flow of illegal immigration is a necessary component of any future legislation. >> in order to get and rationalize our system, we are going to have to make sure that there are not future waves of illegal immigrants. >> and this week, the department of homeland security also took a step to discourage illegal immigration. federal contractors will be required to use the employment verification system known as e-verify to weed out legal workers. lou? >> lisa, thank you very much. i'll have a few thoughts about this report and a lot of the topics that we're discussing here this week. join me on the radio monday through fridays for "the lou dobbs show," 2:00 to 4:00 p.m. each day on wor 710 radio in new york. go to loudobbs.com to get your local listings for the lou dobbs show on the radio. also, please follow me on

loudobbsnews on twitter.com. and a suburban swim club accused of discriminating against african-american and hispanic children from a philadelphia day care center. the director of the center saying that members of the private club made racist comments about the children and canceled their swimming privileges all because of the color of their skin. the swim club denies those allegations. susan candiotti has the live report for us from huntington valley with the details. >> reporter: swimming once a week at the spacious huntington valley club near philadelphia. it sounded ideal for 65 kids described as black and hispanic at creative steps day care summer camp. >> i was excited. the parents and children were excited. >> reporter: but when the youngsters showed up at the pool june 29th, after the day camp signed and paid a $1,900 contract, this happened. >> the children came running down the hill saying, miss wright, miss wright, these people up there are saying, what are those black kids doing in

the pool. >> reporter: her son said he was sitting outside the pool and heard white adults say this. >> they were like, what are these black kids here. and then they were saying, i'm afraid they might do something to my children, they might try to still some of my stuff or harm my children. i was like, i was amazed that they would say something like this because we're just like a kid, we're just like your kids. >> reporter: mrs. wright says the swim club's director told her he was embarrassed, held an emergency board meeting, and called her back the next day to say they could not come back. >> and he said the membership said, let the chips fall where they may. >> reporter: you know, marcus, i see tears coming down your face. why does this make you cry? >> because it's just kind of like sad that like people are still thinking like this. when i felt like this was over. >> this is 2009. children should not be subjected

to that. >> reporter: the swim club's director is quoted by local media saying the day camp kids changed the "atmosphere and complexion of the club." a club member reacted. >> i'll be asking for the president of the club's resignation today, because i think the comment that he made, although taken out of context, was probably one of the stupidest comments i ever heard. >> reporter: he claims the club was simply overcrowded, not racist. he said two other unidentified day camps, both nonminority, also got the boot. lou, at this hour, there's sort of a home-grown protest that has sprung up outside the entrance to the swim club. and if you're wondering about those pictures of the kids swimming now, well, they also have a contract with the jewish community center and that's where they're also spending two days and weeks swimming as well. they also got some invitations from another school here in the philadelphia area, offering them space as well. so the community has sort of

sprung up. the one particular school saying they were appalled at the allegations and wanted to help these children out. we also have some late developments to tell you about. that is to the pennsylvania human rights commission has opened up an investigation because of the allegations and at the request of the naacp and senator arlen specter has also wayed weighed in, sending a letter to the swim club, asking them to reconsider. lou? >> susan, thank you very much. susan candiotti from philadelphia. we'll have a lot more on this story later in the broadcast. we'll be joined by the governor of pennsylvania, ed rendell as well. in ohio, police investigating a report of a brutal attack against a white family by a group of black teenagers. according to the "akron beacon journal," police say the family told them it happened outside a friend's home after a fourth of july fireworks show. marty marshal his wife, his two children and two friends were

suddenly attacked by a mob of black teenagers. marshal said he spent five days in the hospital after that beating. akron police aren't ready to call this a hate crime or a gang activity. they are continuing their investigation. also ahead here tonight, the push for another massive stimulus package. we'll talk about that plan with several of the country's top lawmakers and a top economist. and the devastating economic impact of now california's severe drought. >> no water, no jobs. it's that simple. >> we'll tell you why the national guard is dumping military vehicles off the coast of south carolina. and the plot to dig up hundreds of graves in illinois. i get the question "does it work?" all the time, and you know what, it works. nutrisystem for men: flexible new programs personalized to meet your goals. what's great about nutrisystem is you eat the foods you love and you lose weight. i'm dan marino. i lost 22 pounds on nutrisystem

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california's three-year-long drought is now devastating not only the environment, but california's economy. the state, which is already grappling with an incredible budget crisis is preparing now for what they expect to be a brutal summer of wildfires, job losses, and water rationing. casey wian with our report. >> reporter: it was a small wildfire by california standards. >> the firefighters have taken quite a beating in the heat today, but they've continued to

be aggressive and work the fire. >> reporter: yet wednesday's 80-acre blaze near the getty center museum could be just the beginning. according to a mid-year state report on the three-year california drought, the coming summer and fall present an elevated risk for catastrophic fires, reflecting the cumulative impacts of a third successive dry year. those cumulative impacts are spreading throughout the state, especially among farmers. lack of water has idled hundreds of thousands of acres. all but three of california's 58 counties have been designated as disaster areas by the u.s. department of agriculture. the state estimates nearly $1 billion could be lost in central valley crop production alone this year, as well as 35,000 jobs. >> agricultural jobs, business jobs, cities, grocery stores, all part of it. >> no water, no jobs, that simple. >> reporter: protesters and the governor are demanding federal help. >> i will fight and i will fight and i will fight and do

everything that i can to go and get and create the water, the immediate water that is needed. >> reporter: the obama administration is already sending $390 million in federal bailout money to california for water projects. >> and i as secretary of interior will pledge the resources of this department to get that done. >> reporter: some lawmakers want changes in environmental regulations that restrict farm water supplies to protect fish. >> we will not stop until the pumps on. >> reporter: elsewhere, there's a dwindling option. 50 california cities have implemented mandatory water conservation measures. despite the escalating california budget crisis, governor schwarzenegger has exempted state firefighters from budget cuts, so that, quote, all available personnel are ready and alert to spring into action when disaster strikes. perhaps it's telling that the governor said "when disaster strikes," not "if." california's fire season used to peak in the fall.

with the arrival of hot santa ana winds from the desert. but because of the drought, fire season here is now virtually year round, lou. >> casey, thank you very much. still ahead here tonight, new developments in the murder of former nfl star, steve mcnair, including the dramatic 911 call when mcnair was found dead. and our "face-off" debate tonight on the escalating political battle between democrats in congress and the cia. has the cia been lying to congress? relief can't come fast enough. introducing bayer quick release crystals. it's ready to dissolve faster than caplets or tablets. it's a whole new way from bayer to dissolve pain fast. new bayer quick release crystals.

tonight, in law and order, bernie madoff will not appeal his 150-year-long sentence for

fraud. attorneys would not say way madoff decided against appeal. madoff accused of running a $50 billion ponzi scheme, of which he was convicted. more than 15,000 victims have made claims in court to recover money. he pleaded guilty to 11 counts, including fraud and money laundering. in howell, michigan, a 14-year-old boy led police on a high-speed chase. a chase that reached speeds of more than 100 miles an hour. the car eventually struck an embankment, launching ten feet into the air, as you see. the boy, his 10-year-old brother and 12-year-old cousin had stolen their father's car and fled from police and after making an illegal left turn, the driver told police they were on their way to dairy queen. luckily, no one was seriously injured. nashville police have released the 911 call made after former nfl star steve mcnair was discovered dead. mcnair to the four times by his girlfriend, sahel kazemi before

she then turned the gun on herself. the call was made by robert gaty, a close friend of mcnair. >> a male or female? >> two, there's two people. >> two people? >> yeah. >> and they're both -- appear to be deceased? >> i think so, sir. >> tennessee state officials have revealed they were developing a suicide prevention public service announcement before his death. the 62nd announcement never aired. officials say that airing now would be in their judgment, inappropriate. new york is now the first state in the nation to use taxpayer dollars to pay women for their eggs to be used for stem cell research. the controversial practice raises serious ethical concerns, including whether it leads to the exploitation of poor women. ines ferre with our report. >> reporter: for years, the

private inveto row fertilization pays women for their eggs. the empire state stem cell board says it will use taxpayer money to pay women between $5,000 and $10,000 to donate eggs. dr. robert cliffman sits on the board's ethics committee. >> now that we can pay women for their time and burden for donating eggs, the stem cell research can go forward and could potentially lead to cures that can help millions of people. >> reporter: donating eggs involves numerous tests, hormone injections, and a retrieval process. it can take up to three months, but in extreme cases, it can cause damage or loss of ovaries or kidney failure, especially if women try and donate more than the recommended six times. stem cell researchers say without compensation, simply not enough women donate. >> the question is having a rational market. and i think that what you want to do is, you know, to go in and have the hormone shots and then

to take, you know, the time off from work to have the retrieval. there are lost wages that are involved. you know, there is -- it's uncomfortable. >> reporter: father thomas burg also sits on the board's ethics committee, but he opposed the measure. he's an opponent of embryonic stem cell research. he questions the egg donation procedure and says it will lead to the exploitation of women. >> we have to ask ourselves, why should new york taxpayer dollars be used to pump young women, college-aged women, lower-income women, full of hormones to retrieve eggs for them? >> reporter: the money will come from a $600 million fund approved in 2007 to be used over an 11-year period for stem cell research. and at least 11 states fund stem cell research. some states reimburse women for actual expenses incurred during the egg donation process. new york expects others will consider also paying an additional fee to donors and that's exactly what critics

fear, lou. >> and the state legislature, the governor, the physician, on the part of the government of new york. >> yeah. this was approved in 2007 and funding for this has been periodic and paterson just approved more funding for it. >> despite the fact this is obviously selling human tissue. >> well, the law allows it and this is what the critics are saying. it's really a transaction, a cash transaction for human tissue. that's exactly what critics say. but the law allows it. >> in point of fact, it is human tissue and it is being paid for. and they're not willing to acknowledge that straight forwardly, or -- >> well, for sperm and for eggs, you can compensate. again, what people -- what these people are saying, the law is allowing this and we're actually paying for their time and we're paying for their efforts, we're not actually paying for their eggs. but the critics are saying, this is a cash transaction. you're paying for those eggs. >> yeah.

semantics and observeification, no stranger to politics, but as senator chuck schumer said of illegal immigration, straight forward language would be appreciated here. thanks a lot. house speaker nancy pelosi is saying no to any proposal of a former resolution that would honor michael jackson. democrat, shelia jackson lee, the congresswoman proposed that legislation during tuesday's memorial service for the late entertainer. jackson lee said the resolution would honor michael jackson's life and work. she called him, quote, a global humanitarian. the speaker of the house, however, says the resolution would be a distraction, which would open up two contrary views on jackson's life. the speaker says house members can honor jackson in speeches on the house floor. up next, the debate over a second stimulus package. and was the cia lying to congress? that is the subject of tonight's "face-off" debate.

the growing controversy over whether the cia lied to congress is a subject of our "face-off"

debate tonight. joining us now, republican congressman darrell issa. he's the ranking member on the judiciary committee in the house. he has just requested that the fbi conduct an investigation of speaker pelosi's claim that the cia misled her. also, democratic congressman adam smith, who serves on the intelligence committee, who is among seven house democrats who say cia director leon panetta misled them and who has requested that he recant that statement. we appreciate you gentleman being with us. let me remind everyone watching as to how the incipient point here. it begins with speaker nancy pelosi and what she had to say about harsh interrogation techniques or what some call waterboarding torture. >> i was not briefed that. i was only informed that they were briefed, but i did not get the briefing. >> but you were aware -- >>we well, we'll find out.

they mislead us all the time. >> well, then cia director panetta fired back in a letter to the cia personnel saying, let me be clear, it is not our policy or practice to mislead congress. that is against our laws and our values. let me ask you both, first, if i may, congressman issa, do you believe the cia did mislead speaker pelosi? >> no, i don't. i think porter goss who said he was briefed in realtime and continuously briefed is probably more accurate. and when speaker pelosi says they mislead us all the time,ic the fbi needs to investigate. because "all the time" implies multiple felonies. i think that's where speaker pelosi crossed the line. not that she didn't remember being briefed, which none of us can know, but the idea that she would just blithely say that the

cia lies to us all the time. that's demoralizing for the premiere intelligence agency. >> congressman smith, as one of seven democratic members to write that letter to director panetta, asking him to correct his statement on misleading congress, let me just share with our audience part of what you wrote in that letter. recently you testified that you've determined top cia officials have concealed significant actions from all members of congress and misled members for a number of years from 2001 to this week. this is similar to other deceptions of which we are aware from recent periods. and asking him to correct his statement, has there been a response from the cia director, is there anything that you -- i mean, specifically, is there a cia program about which you have not been informed and which directly contravenes director panetta's statement. >> he said he just discovered it

as director and within 24 hours of him discovering it, he came and testified and said that cia wrongly did not tell us about this. there were questions in the course of this program in which some people who testified clearly did mislead us. look, this isn't really about nancy pelosi. as a member of the intelligence committee, what i am concerned about, i want to make sure that the cia is open and honest with you. and clearly, members, republican and democrats of like have complained that they have not been. not just the cia, but other aspects of the intelligence community. it's not just our -- it's our duty and our right and our responsibility as members of congress to insist that the cia is open and honest with us. and clearly, they have not been. not just in the last eight years, but going back 30, 40 years. it's an ongoing battle for members of the intelligence community to make sure we get that open honesty. >> congressman, you're shaking your head? >> i am for a number of reasons. as you know, i served before i became ranking member of government oversight and reform.

i served on the intelligence committee. and i will tell you that multiple hours every day, plus weekends and breaks, i went all over the world to get briefings, to get information, and i only got a tip of the iceberg. one of the problems is, none of us can get all the information in the time that we can possibly contribute. >> that's absolutely true, but that's not what i'm talking about. b >> but more importantly, every briefing is highly compartmentalized. certain people have to be in the room, out of the room. >> again, not what we were talking about. >> i think if we want to have an investigation on a specific failure, a criminal investigation, i look forward to it. i want to see it. what i'm concerned about is the speaker -- it is about the speaker. it is about a vague statement that they lie to us all the time, not that there was a program from 2001 that was never briefed in congress. by the way, the program never became active. it never actually functioned and it's been shut down and now

we're being told there was a program that never happened, that in fact we weren't told about. there was absolutely -- there were hundreds or thousands of programs that were never told to us that happened. >> look, the director of central intelligence, leon panetta, told us that it was improper and a mistake by his agency to not have informed us about this program. it is not in dispute that the cia did not tell us about something that they should have told us about. this is not the only incident. so all i'm trying to do, darrell, all i'm trying to do, again, you talk about -- you talk about what what happened with speaker pelosi, i don't know what happened with speaker pelosi -- >> none of us do. >> exactly. it wasn't even recorded in a timely manner. what i am focused on, and we keep bringing it back to speaker pelosi. what i'm focused on is the fact -- i've only been on the intel committee for six months.

there have been two innocents where the intelligence community come to us and say, we should have told you and we didn't it. >> if i may, gentleman, you're both members of an institution that has historically low regard in every poll of the american people. you are, congressman smith, in this letter, taking on a former democratic congressman who is now -- >> we are -- >> if i may. who is now the director of the cia, who is the man who revealed to you whatever it is that you can't share with us because we're not on the intelligence committee. and it seems punitive to him -- i mean, it seems startling -- >> let me make one critical point -- >> if i may just frame the question, congressman. what in the world do you accomplish by having leon panetta sort of dragged out in public -- >> let me make a point here. the letter that i signed was sent in secret to director

panetta, and my intent was to point out to him the inconsistency in the action that he took in saying, we don't like to congress, we don't mislead congress -- >> do you think he was unaware of that consistency -- i'm just curious. >> and, well, he did it and testified it. i want to highlight this issue. it was never my intention -- >> so who leaked the letter? >> it was never my intention that this letter become public. i've heard two or three different answers. i'm trying to deal with a policy issue to make sure congress is informed. >> okay. do you want hearings? >> i don't a big public spat. >> do you want hearings? >> in the intelligence community, absolutely, we should have hearings. >> and those hearings would extend to the -- whatever from the oversight committees of congress? >> absolutely. >> and congressman issa. >> i want hearings, but more importantly, i want anyone who lied to congress brought on charges and punished so those who did not do anything wrong can be vindicated. that's what we're asking for. more importantly, right now -- >> gentleman, i --

>> the bill coming up tonight is about whether or not we get to have the information at the hipsy or only at the gang of eight, equally important. >> we're out of time. we thank you both for your time and in trying to add some light to this issue. congressman smith, thank you very much. congressman issa. still ahead tonight, views from coast to coast on this economy. do we need a second stimulus package? is it a little early to determine whether it succeeded or failing, that is, the first one? we'll be talking with elected officials and economic experts from all levels of government and all parts of the country, next.

the growing debate over whether this economy requires another federal stimulus package is under way.

the original $787 billion package has been barely been spent, only a fractiono of it, the administration and congress, many in those two say another round may be needed. and it's only been four months. we're joined now by ellen sinai, chief global economist, president of decision economics, the governor of the state of pennsylvania, ed rendell, a democrat. good to have you with us. governor congress bilbray, republican, of california. and congresswoman loretta sanchez, a democrat from california. she is now on the floor of voting and will join us here in just a moment. i want to say thank you to all of you for being here. let's start out with the stimulus package. less than 10% of the this package has been spent, yet we're hearing cries and calls for a second stimulus package. let me ask you, if i may, governor rendell, what your reaction is. do you need it, do you think it makes sense to call for it now?

>> it's really premature, lou. i think the president is right saying it can't be off the table, but it's far too early to tell whether we need it. in pennsylvania, we have spent literally $1 billion of the $16 billion that we're going to get under the stimulus program. although we've contracted out over 65% of our road and highway projects, work has begun on about 50% of them, but it's just begun in the last couple of weeks. remember, it's less than four months since the plan, the pennsylvania transportation plan was approved. that's an incredibly fast time to get the work beginning. let's see how it does, see the impact that it has. >> congressman bilbray? >> well, lou, any bill put together in the dark of night, you're asked to vote for it within a matter of hours, without anybody reading it has -- is fraught with problems. and right now it looks like the price tag is very high. in fact, the projection of the reduction in unemployment or the control of unemployment is about

an 85% -- i mean, al degr85 deg payo off. i think we've to be more smart n government. quit trying to throw money at every problem and start talking about substantive reforms rather than always asking the taxpayer to foot the bill. >> do you have a date certain when we'll see a smarter congress? >> it's about time when the voters start -- they said they wanted a smarter congress last election. no one promised that they'd change and it would be changed less in people's pockets after the federal government spent their money. >> i didn't mean to set you up for that expression, that partisan expression, congressman. let's go to, if we may, before i ask you the question, allen, warren buffett quoted on abc's "good morning america" this is what he had to say about the first stimulus bill. . >> the first stimulus bill was

half a tablet of viagra, you know. and then having also a bunch of candy mixed in it. everybody is putting it into its own constituencies. it doesn't have the power that might have been anticipated. >> allen, you're qualitied in a "wall street journal" saying they should ab loud to work through the system. you have the life warren buffest nobel prize economist saying bring it on, another round. what do you think? >> we have to let this one work its way ouchlt people are saving money that, is healthy. they have to get it going. i think we need a time and by the fourth quarter we're not seeing much in the way of results, then we ought to -- can you talk now about what might be necessary in another stimulus

package. but it's too early to call this one out. >> it appears that all your various perspectives in agreement on that issue. yet, there is a drum booel beat building in washington, d.c. unique in all this is the claims that people did not know how bad the recession was back in february. did not know at the extent of it. yet, we're talking about the largest stimulus package in american history. we are looking at a great deal of fear right now that remains on wall street. high unemployment, 9.5% by some standards including discouraged workers on a detatched workers from the workplace, 16.5% unemployment, a loss of some $12 trillion and n. this economy. where do we stand? do you sense recovery beginning to take hold?

>> we have 8.2% unemployment, far better than average. for the first time i'm seeing business expansion. some of our businesses starting to grow again, coming to us for money to help them expand. i've seen new business start-ups, particularly in the energy bill. i want to make a paint to follow up what our economist said. >> quickly. >> if we add another stimulus, it ought to be 100% hard infrastructure which we know produces jobs and orders for american factories. >> warren buffett would put it all viagra aand no candy. >> absolutely. >> we've just been joined by loretta sanchez, democrat of california. great to have you with us. >> thank you, lou. >> if i may ask you, what is your sense? is recovery beginning to take hold? or do you in california, the people you represent in desperate need of as much stimulus as possible? >> well, we have seen some of it come down.

actually 20%. they have already come down into the state. in particular in my area in orange county, we're having the largest flood plain, for example, west of the mississippi. we've seen $24 million already obligated to the project of making sure that 80% of the people that live in orange county will be taken care of or we're working on that flood with the issue for the river. so we're seeing real money come down for law enforcement. >> you are seeing real improvement in the economy? do you get the sense there is economic recovery taking hold in orange county? >> remember that orange county was the seat of four of the subprime lenders headquarters. we're based in new home construction. that's one of our big industries. so it's been very, very difficult for orange county. but what i see happening and what chapman university who does the metric model for orange county said this will be a plateau year. we're sort of trying to find the

bottom in housing and the economy. we'll see better stats. >> congresswoman, the plateau in many parts of the country feels like real progress. let me turn, congressman in your part of california. what does it feel like? >> just like the governor said. instead of putting the money in the transportation issues where you know how you're going to pay for it with user's fees and the future, less than 3.8% of the stimulus bill was going into those infrastructures that government is talking about. >> okay. >> most of this was done with exactly what washington usually zshgs turns it into -- >> congressman in san diego, does your district -- we're out of time. yes or no? does it feel like recovery? >> no. we don't see major recovery. but the fact is we're seeing struggles back and forth. >> allen? give us your best judgment. recovery? >> statistically. i don't mean functionally. it's going to be bad.

terrible jobs market in washington. and they'll eventually do more stimulus because they won't be able to stand the high unemployment rate. but statistical recovery, yeah, by late this year. that means real gdp will grow positively but not very much at all. >> a jobless recovery, unfortunately. thank you very much. governor, i want to thank each of you. bring let you go, the story we reported tonight on those young people hispanic and african-americans who were denied access to the pool there in huntington valley at the valley swimming club. your thoughts very quickly? >> it was even worse. they were actually thrown out. they were originally contracted from the camp to come in. then something happened and they were exited. the state human relations commission started an investigation number one is allowed to discriminate in pennsylvania. we're going to get to the bottom of it. >> yeah. it kills me. a young man in our report said to our suzanne candiotti in,

2009, who would have dreamed such actions were even possible? thank you very much, governor. congressman, we thank you have much for being with. we appreciate it. up next, some of your thoughts and more. stay with us.