sexually explicit review received $25,000 from the nea. and a san francisco movie house featuring for example what it describe as underground pore noe film received $50,000 in taxpayer money. many states tonight are facing massive budget deficits. they're considering desperate measures to raise money. state lawmakers are resorting to all sorts of plans and accounts measures trying to close their budget gaps. >> reporter: lawmakers in arizona are struggling to close a $3.4 billion budget deficit to avoid any greater spending cuts and tax increases they're proposing to sell the capitol building where they work. along with the sale and leaseback of other state proept arizona lawmakers estimate they can raise more than $700 million. >> it is a technique being used all across the country by many, many states to help balance their budgets. it's also a mechanism that we

had no disagreement with on the democratic side of the aisle. >> reporter: washington state governor sign add budget that closed part of its deficit by calculating the savings in pension payouts based on state employees working longer while not recognizing that they're also likely to live longer. alabama eliminated funding for school supplies but the costs will be shifted to already cash-strapped local school districts. california which just reached a deal to close a record $24 billion deficit took budget smoke and mirrors to a new level. it will say money on paper by delaying paychecks of workers for one day, pushing the costs over to the next fiscal year. >> if you have to make quick adjustments and you have to go and make the necessary cuts. >> reporter: california is also collecting taxes sooner to inflate this year's revenue and it's banking on selling part of

the state-funded workers' compensation insurance business for a billion dollars, a deal that they conclude is risky and not likely to happen in time. >> what's worse, the kind of manipulation and deception and sort of really, you know, shady budgetary tactics that this thing represents or, you know, tax increases or further spending cuts during the middle of a recession. >> reporter: he says the maneuvers are legal but risky especially if it persists and state revenues don't rebound quickly. the national con o frens of state legislature says state-based bunt short falls total. using gimmicks to close those gaps is especially risky for states like california which face structural budget deficits that are likely to continue for the foreseeable future. >> thanks very much, casey wian. we have a safe landing of the

shuttle "endeavour." the shuttle with seven astronauts on board touched down after a 16-day mission. they delivered critical spare a parts among other things to the international space station. the crew also brought back a japanese astronaut who had been in orbit since march. well, seven more shuttle flights remain before the fleet is retired next year. coming up, congressmen go on vacation, leaving much of the people's business unfinished. also new pressure to force employers to use e-verify and employers to use e-verify and stop illegal president obama's health care plan and his plunging poll numbers. now the colors of life

can last a lifetime. valspar -- the beauty goes on.

one town in rural pennsylvania has seen its health care costs fall sharply. it's danceville, pennsylvania. it's home to the medical center. the obama administration points to it as prove that the health care system can be made more effective and efficient but can the model work for a neigh as a whole. jessica reports. >> do you feel me pushing? >> reporter: this cardiologist is looking inside a patient's

heart and getting graded on his work. >> we're in the heart and we're taking some pictures. >> reporter: the grade is based not just on the success of this procedure but on the overall care his patient receives, sometimes up to months later. >> everybody that's involved in the care is focused on the outcome. not their piece of the action. >> reporter: it's part of a radical new approach to medicine that's made geisinger health system and obama poster child for reform. it's cut costs and improved quality by standardizing how procedures are done, developing a team approach and emphasizing preventive and follow-up care th. all of those things are thought to be related to the probability of you having a perfect outcome. >> reporter: the medical team follows steps to ensure there are no mistakes like making sure the right patient is on the

table. >> can you tell me when your birthday is? >> reporter: another innovation? a warranty. patients can pay a flat fee for treating their heart condition. if there are any complications, the patient gets follow-up care for free. >> this warranty system just provides additional incentive for us to do the right thing. >> reporter: a third innovation, patient partnering. a nurse is assigned a patient with a chronic condition and checks in regularly. nurses can even get a readout of a patient's weight every day. if he gains weight -- >> dan's going to be on the phone the next morning looking for an explanation. >> reporter: partnering has led to a huge decrease in hospitalization. dr. berger says these inoh vagus have helped make his patients healthier and they say in some instances they've saved up to 7% a year. now, the question, kitty, is can

this team approach be duplicated nationally. the doctors say while some parts of their system will be duplicated more easily than others. for example it might be easier e to get doctors around the nation to adopt electronic medical records but probably harder to get primary a doctors, nurses, physicians and specialists to coordinate their work together. >> thanks very much. jessica yellin. well, as we have reported public support for the president's health care plan is dwindling. his approval ratings are also declining and so is the health care for obama's sliding poll number. joining me now matt lewis from politicsdaily.com and caron. thanks for being with us. i'd like to sight the poll number es we're talking about just to start. and this is the latest rasmussen presidential tracking poll and it really does show a clear --

clear shift in the nation's affection toward president obama. and it's a sample of likely voters. has a 39% strongly disapprove of the job that the president is doing. 28% strongly approve. it's been an absolute flip-flop. matt, what's your thought on this? >> i think it's a virite of reasons. first of all, the policy. if you look at it, the possibility of rationing which some people mock, but i have to tell you it's a possibility if get a national health care system. i think a lot of meshes are looking at the economy. we've lost 2.6 million jobs since president obama was sworn in and here he is trying this big health care effort which the congressional budget office and their scoring says it will actually increase the deficit. and lastly, think, looking at his style and his leadership that's been lacking, the press conference, he gave that big prime time press conference last week, it fell flat.

he failed to inspire and connect at an emotional level. i think when you combine those things it's not surprising he hasn't had a good week. >> karen, matt clearly saying it's his fault. what do you think? >> on o vusly there's not going be rationing of care. you have it now because if you're poor you frankly don't get access to care. look. i think if we take a look at these numbers, considering where the president was, you know, in the high 70s, you have to expect things are going to stable out a little bit. let's be honest. whether you agree with what the president has done he's had to take some pretty hard steps to stabilize the economy, to deal with our banking system, to get a handle on the housing crisis. we had some moderately good economic news today. we're only in the first, you know, six months or so of the economic turnaround. those are tough decisions that the president's had to make, and he's been willing to put his political capital out there to make those decisions, doing what's good for the country and not so much worried about the poll numbers.

and the other thing i find interesting in these numbers when i talk about health care, actually when you start to ask people questions specific to some of the policy ideas, they do like those ideas. we know that 70% of americans actually want a public health insurance option and that including about 50% of republicans. so when you dig down to that sort of next layer, people are supportive of the individual proposals. there's obviously a lot of miss information out there. and part of what we'll see in august is a conversation with people to try and, you know, correct some of the misinformation and also hear from the american people. >> this is, of course, very politically difficult. it didn't really help when president clinton had some trouble with it. failed to push through health care reform. we have how the public is looking at the numbers when it comes to the president's handling of health care, and we have 43% approve and 45% disapprove. matt, health care and your thoughts on just tackling such a

large issue so early in the presidency. >> right. there have been all sorts of problem, strategic problems, tactile problems. part of it was he said we're going to get it done by august, pass a bill in the house and senate. he failed. the voters, i think, have punished him for his lack of leadership and failure to deliver. i think he learned the wrong lesson from the clinton years. bill clinton had a lot of details. he tried to sort of take his time, and barack obama's done the opposite. he's essentially outsourced it to congress. so he's lost control over his message. he's lost control over it and we have these committee chairmen who have been in congress or the senate for 30, 40 years and they're not so keen on this whipper snapper telling them what to do. so i think he's found himself in a deceptive position and i think that harry reid and nancy pelosi are calling the shots, not barack obama. >> karen? >> obviously i disagree with that. let's be clear. the president said from the

beginning we need to pass health care reform by the end of this year, and i think if we fail to do that, frankly i think that the consequences will bair out in 2010 and it won't be just about the president. it will be about members of congress. this has been a problem for a long time. it's not like this just came up out of thin air. so i think the american people and the voters are going to hold members of congress accountable for actually getting this done. to the point of dealing with health care, he had to deal with health care reform. we know that the health care system in the country is imminently linked to the economic problems we're facing. it's crippling our small businesses and large businesses. we know a large percentage of the people who went bankrupt and lost their homes, why did they go bankrupt? because of their health care costs. so we know that that is just as imminently linked to parts of our economy as the banking system was and the housing system was. so he really didn't have a choice. unfortunately it was left undone, so this president stepped up to the plate and said let's get this done. >> how do you think -- i'd like to ask both of you. how do you think he's selling it? let's listen for a moment to his

prime time news conference last week. there's a clip of this. give me your assessment of what you think. >> i get letters every day from families that are being clobbered by health care costs. and they ask me can you help. so i've got a middle-aged couple who will write me and say our daughter just found out she's got leukemia, and if i don't do something soon, we just are either going to go bankrupt or we're not going to be able to provide our daughter with the care she needs. and in a country like ours, that's not right. >> we've seen him give speeches like this or give examples. we've seen him in sort of forum settings with real citizens. matt, your thoughts on how he's selling this plan. >> style iststylistically, it w horrible. i was a prime time press

conference. ronald reagan would have hit that out of the park. bill clinton would have knocked that out of the ballpark. barack obama during the campaign was often praised for being very logical, no drama obama, and there's a lot of good things about that. but he could not connect emotionally. you could see he was attempting to tell this story about this average person who was asking for health care. ronald reagan would have told that story. bill clinton would have had you tearing up. there were no tears when barack obama said that. >> karen? >> look. ly agree and can see the point that i think democrats need to get back on offense in talking about health care reform, and i don't think it needs to be just emotional points being made. again, i think there are economic points to be made about why thisimperative. and we need to get out there and combat some of the misinfor make. there's not going to be rationing of care. >> that's ridiculous. you know, as the president has said from the beginning, if you like what you have, you can keep it. if you want something different, there will be a public option.

>> he said a lot of things about the bailout too. >> they're saying they're against competition in the marketplace. afraid of a little competition. >> competition with the government paid for by my tax dollars. that's not competition. >> look. we have -- >> barack obama voted against -- >> will you let me finish or do you want to keep interrupting. we have three systems already. va system and medicare. actually va has the highest customer sat fax whether it's private or public. think if that's good enough for our men and women in uniform, obviously they deserve the best, it ought to be good enough for our men and women. >> matt, last word for you. >> i think president obama voted against allowing americans to negotiate from state to state. right now if you want to buy health snurn you have to buy it within your state. you can't cross state lines. that would be real competition. it would be something very easy we could do to bring down the

cost of health care. >> actually that's not true. >> are you going to ip ter result me. >> yes, i am because now what you're saying is it's not even true. >> again, the idea of having a public health insurance option available to people is you would have portability and you would have a larger par beganing power to leverage the lowest cost available both for small businesses and individual. look. the costs now that people who don't have insurance. your premiums and my premiums are actually thousands of dollars higher than i would be if those people had health care. >> there are a lot of plans that are -- >> so what's good enough for the u.s. congress isn't good enough for the american people? they desieve something the rest of the american people don't. >> we have to give you the last word. this is truly the last word. >> i believe in freedom and competition. it's not competition when the government owns the program and it's subsidized by my tax dollars. i want real competition and real health care reform. don't get me wrong. i'm not against health care

reform. i'm ghent a national plan that will essentially run it like whelp you go to get your driver's license or go to the post office. it's not they're fegtive. the dmv. that's the word. >> matt lewis and karen finny. very nice spirited debate. coming up they debate his performance after six months. now our political panel will weigh in also next and 97 illegal immigrants found crammed into a refrigerated trailer arizona. we'll have that story and much more next. every day, transitions lenses are there to help care for my sight. announcer: transitions lenses adjust to changing light to reduce glare and help protect your eyes from uv damage so you can see better today... and tomorrow. live your vision. transitions. healthy sight in every light. to learn how transitions lenses can help protect your family's eyesight, go to our website or stop by a wal-mart vision center near you.

arizona authorities found immigrants crammed inside a refrigerated truck. they found 97 illegal immigrants including children as young as nine and they were sitting among palettes of mangos and it was just above freezing. the illegal immigrants are in custody. well, there is a new bipartisan push in congress to make the e-verify program mandatory for all employers. it's to make sure potential employees are legally eligible to work. it's the single most successful program against illegal immigration.

the accuracy rate, 99.6%. lisa sylvester has our report. >> reporter: the internet-based system is called e-verify. the employers input the names of o prospective employee and withins the system will tell whether it's authorized to work in the united states. 's now a voluntary program but it's proposed legislation that would make it mandatory for all u.s. employers as a way to reduce the hiring of illegal worker es. >> with high unemployment, half a million people losing their jobses every day. we have to ensure that american -- americans and legal immigrants get those jobs. not those who are -- who are breaking the law. >> reporter: currently arizona, mississippi, and south carolina have passed laws that require all employers in this state use the e-verify system. the u.s. chamber of commerce has asked the u.s. supreme court to review the arizona law's

constitutionali constitutionality. others say it is not full-proof, that it can lead to an increase in identity theft. >> it has in some instances been beaten by simply using a stolen identity. some employers -- and there's a swift meat-packing case from a few years ago, beat e-verify using stolen identity. >> reporter: still the system is gaining popularity with some companies growing at a rate of 1200 new employers every week. >> they're no longer paper-based, it's free to use, and most uponly for them it's credible deniability if the federal government comes to them and has work enforcement issues. if they use e-verify it shows good faith effort on their part. >> and add to that list soon federal contractors and subcontractors. the obama administration twice

delayed implementation of a rule that would require e-verify use it to do business. but this month they reversed course and that rule will now take effect september 8. kitty? >> thanks very much, lisa sylvester. joining me now are the best political a minds. we have joe, miguel, and cara. thanks for being with us. i thrng we should start with the beer summit. to me that was one of the more intriguing aspects of the news. miguel, your thoughts on that. >> i was a little disappointed. i expected more to come out of that summit. i really wanted the two guy, the sergeant and the professor to come out and say, listen, we were both a little wrong here and let's mend things but let's have the whole country mend things. let's both work on racial profiling with the president's support. i needed a plan. i wanted something constructive to come out of that, and it

didn't. >> tara, you actually in your column called it a side show. elaborate on that a bit for us. >> it was a side show to side step the, you know, verbal gaffe that the president made. i wouldn't express disappointment because i was a little bit cynical early on. i was hopeful but still cynical in that nothing probably would really come out of it in that it wu obvious these men had both had -- the two men involved had very strong positions on both sides and that this was more of what the president had talked about we shouldn't be doing is simply talking about race as opposed to doing anything about it. it was obvious that was not going to take place which begs the question of why. we were focusing as the media -- the media was focusing on all the wrong thing, what kinds of beers they were going to drink and what kind of picnic table they were going to sit at. if they had been challenged more

on what the substantive issues were going to be or the substantive con very saying was going to be about or what was going to come about, we should have and could have expected more. you know, short of that, nobody was really questioning what they should have been questioning and how this was going to raise the discussion of race relations in general, not just racial profiling. i think we all recognize that's not what happened here. but if you're going to raise the level of ray, let's start with the conversation but that also starts with an apolegy. >> you seem to be blaming the press's coverage of it as much as the substance of the event. joe, thoughts on this. >> >> well, i thought from the president's point of view it worked out as well as it could. he didn't want that to become the issue. he wamed to cool things out. and i think professor gates and sergeant crowley helped him do that with their statements afterwards. i think, you know, professor gates even showed a sense of humor about that. sergeant crowley is not bad guy

or a likeable guy when he's not arresting you. that kind of put a friendly co-da on the thing which is what they could have hoped for. >> imagine what they could have gaped if the two guys got together now and said, listen, now we going, two together to work on these problems. >> you know, miguel, they did say that. professor gates sate it's incumbent on us to try to continue this discussion afterwards, not necessarily in the white house because that's not what the president wants. maybe they'll meet again. from president obama's point of view this isn't the subject that he wants at the top of the agenda right now. think he's right. >> tara, go ahead. >> sergeant crowley also pointed out, you know, we will simply agree to disagree. so to that extent there's not going to be any movement in that regard and frankly who's teaching whom, and so what the president did, though, he recognized and the polls bear it

out is that he really put his foot in it, if you will, and wanted to doing do something to resolve this quickly so it would. hurt wouldn't hurt him essentially politically. it already has. it had more to do with that. i don't question his motivation for wanting to put race out there but i do question his real lack of acknowledgement there is any ability to do anything beyond making this a photo-op. >> we are going to take a break and come back with some other subjects and more with our panel in just a moment. and jeep dealer, and get up to double the government's cash for your old car. now get up to $4,500 for your old car... plus, up to an additional $4,500 cash allowance. no turn-in? no problem. your dodge, chrysler, and jeep dealer guarantees everyone up to $4,500 cash allowance... on virtually every model. get to your dodge, chrysler and jeep dealer on the double, and get double cash for your old car!

we're back with our political panel. i'd like to move on to the subject of health care gentlemen and tara.

one of the things that intrigues me, president obama's former physician dr. david shiner doesn't like the president's proposal. he feels it is a succession of compromises. that strikes me that his own physician is worried about this, especially in the cost structure of it. miguel, your thoughts on this? >> because it is a succession of compromises, i don't think the doctor knows what we are talking about. i don't think president obama knows what we are talking about. there are so many things going around that nobody knows exactly what is being proposed. the american public certainly don't know and that is causing the problem an the confusion. if the president had a definitive plan this is exacerbateexactly what i want instead he is saying let's see what comes about and i will take credit for it. the american people can see

through it. >> tara, your thoughts? >> i think he should have done more on the front end to listen to what constituents and taxpayers and americans are saying. this plan is not palatable. 56% don't want an overhaul. >> 72% said they want the public option. you can find a poll that says anything about because people don't know -- >> the public didn't like it. the blue dogs had to be responsible to the constituents. >> all the members of congress are there for their constituents. the president came in to do something about health care. it is not true he didn't say what he wanted. he laid out what he wanted. >> vague. >> no. they were very specific. the president said, please in congress come up with the bills

that will meet these proposals. >> lord knows the congress knows how to spend our money. >> he didn't leave it up to congress. he has to sign the bill. >> we have to leave it there. thanks very much. we will be debating this for a while. coming up at the top of the hour, john roberts in for campbell brown. >> hey, kitty, great discussion. at 8:00, what really happened the day that michael jackson died? his personal chef was there. she is going to join me live. has celebrity stalking gone too far? two police chiefs are charged with breaking into the home of the surrogate mother of sarah jessica parker and the small business owner who went toe to toe on president obama with his health care plan. still ahead, we have heroes. stay with us. when i was told i had diabetes, i felt amazingly boxed in. (announcer) joe uses the contour meter from bayer.

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time now for "heroes." we honor first lieutenant joshua rodriguez. bill tucker has more. >> reporter: for lieutenant first class joshua rodriguez the army is a family tradition. >> growing up in a military family with my grandfather, my cousins and uncles started out in the military. that seemed where my path was going to be. >> reporter: two days of graduating from west point he married his high school sweetheart. as a member of the army third brigade fist infantry division he knew he would be deployed. >> i told my wife i'm doing that because i love you that much. i want to make sure you are safe here. she doesn't believe that line

but it is true. >> reporter: extensive training prepared him for his mission. on may 3, 2009, his platoon was fortified an observation point on a supply route in an afghan valley prone to attacks. >> the troop flare goes off. i looked at it. the sergeant looked at it. we knew something was about to happen real quick. >> reporter: the enemy was within ten meters, 30 feet away. hand grenade range. rodriguez's platoon had 43 hand grenades. >> we threw 40 of the 43 that we had. >> reporter: his team of solders fought 80 insurgents before air support came in. for leadership and bravery