>> clayton: a special thank you to famous dave's. you'll have fun? [ cheers and applause ] studios. good morning, everybody, but a different story for your pocketbook. a nasty day on wall street. jobs are front and center this morning on employment numbers for the month of july are a bit better than expected but, frankly, not even close to where we need to be. employers adding 117,000 jobs. now, the unemployment rate pushing down slightly to 9.1%, this after stocks fell through the floor. the dow off more than 500 points by the close, the worst one-day drop we have seen since 2008. wiping away the gains for the year. to your 201k this morning, formerly known as the 401(k). good morning, everybody, i'm bill hemmer. we'll find the silver lining. alisyn: we will. bill: how you doing?

alisyn: i'm doing all right. it wasn't just here at home, markets took a beating worldwide. bill: they certainly did. opening bell just about 30 minutes away. stuart varney with a very busy day yesterday on the fox business network. first the numbers. what do we need to understand? >> reporter: okay. there was a modest sigh of relief when those numbers were released. the unemployment rate down to 9.1%, 117,000 new jobs created in the month of july. okay. a mod sigh of relief. modest sigh of relief. didn't last all that long because when you start digging in to the numbers, you can see this is by no means a dynamic recovery from the slowdown we saw earlier in the year. 117,000 new jobs does not make it if you want to put a dent in the overall unemployment situation, and you have to remember that 37,000 state government jobs were lost last month. we predicted this, it is happening. big layoffs at the state worker level. so you've got a sigh of relief,

it's modest, at least it wasn't a contraction in the number of jobs, it was a modest expansion. that's how we're reading the numbers. bill: and you've been warning us about these government layoffs for months. the markets today, which direction, stuart? >> reporter: okay. when the opening bell rings, the market will go up a little. there will be a modest bounce. if it opened right now, the dow would be up about 65 points. now, that's not much of a bounce after a 500-point loss yesterday. frankly, bill, it's very hard to say how this market will play out over the full day's trading because, remember, it's not just america's economy that is moving this market, it is europe's crisis which is also moving this market, and there's not much encouraging news from there this morning. bill: pick up on that point. as a financial man, how do you analyze that when it comes in the direction of our country and the direction of the world? >> reporter: okay. our country, in america, looks like we're in for a period of very, very slow growth.

i'm not going to suggest double dip recession, not sure about that, but very, very slow growth. it's a bit like europe over the past couple of years. it's a bit like japan over the last two decades. we're expanding, but very, very little. and we keep a high level of unemployment, that's what we stay with, high level of unemployment. that means not much relief on the jobs front and not much relief on the housing front. bill: and that takes us into a whole political question, too, that we're going to analyze. stuart, thank you. the dow 30's up 1600 points in eight days of trading. see you at 9:20, stuart. thank you, you've got a busy day. last time we saw a bigger one-day drop was back in the fall of 2008, remember that? september 29th of that year the dow plunged 778 point toss the downside, that was the biggest all-time point loss in one session. about a month later it happened again, 733 points to the negative side, the second biggest point drop that we have

seen in our o history. the end of the year in december, a 680 point drop, and what happened to jobs? we went from 7.6% unemployment in january of 2009, go five months later in may of that year, we're at 9.4%. these numbers will tell you an awful lot about where we have been and, quite possibly, where we are headed. alisyn: now we wait. the markets are set to open in just under 30 minutes, and after the roller coaster ride we saw yesterday, it will be very interesting to see what happens when the bell rings. we have the best team in the business covering this. we'll hear from neil cavuto, charlie gasparino and gerri willis throughout our show to help us understand this. bill: and all of this a very unhappy birthday president for president obama. how did the white house react to what happened yesterday? here's the press secretary, jay carney, well before the 500-point close when the dow was at this point when the question was asked, the dow was down

about 300 points. >> stock market took a steep dive today which, i'm sure, you saw. any reaction to that? >> well, no. i don't have a specific reaction to the market. markets go up and down. bill: all right. now, president obama was going to -- well, he'll speak later this morning. in all likelihood, he will address the jobs picture, the economic picture, the jobs report that came out. is the white house doing enough? how many more bullets does it have in its gun to fire at this economy? our political panel weighs in on all of that. a great debate coming up for you, fair and balanced w a great team here on "america's newsroom." alisyn: is this double dip recession we've been fearing? some economists say, yes. others, like stu, are not as certain. so the last time the u.s. saw a double dip was 1981 when ronald reagan was in office. we're going to talk to art laffer in seven minutes to get his take on whether this is, indeed, a double dip and then, more importantly, what to do about it. and there are, also, new

reports this morning of a possible deal to end the federal aviation administration's partial shutdown. the senate is expected to pass a short-term funding bill today that will help keep more than 75,000 workers on the job. fox's peter doocy is live in washington. peter, how close is a deal to being done? >> reporter: pretty close. we don't think it's going to take long at all for it to actually pass. the senate's going to go back to work at 10:00 this morning, and it might only take a few minutes to pass this very short-term extension that would open the faa back up, and this news comes really just in time for some of those engineers who have been furloughed. >> i can make my mortgage this month. i'm very happy to make that. yes, that's a good thing to be able to pay your mortgage. i'm just like anybody else, i've got three cars that don't work well, and i couldn't have gone six weeks. >> reporter: the top democrat in the senate, harry reid, thinks this deal's all right for now saying, quote:

>> reporter: so democrats have certainly changed their tune. it was wednesday a handful of prominent lawmakers from the left got together and called the their republican counterparts hostage takers over this whole thing. those republicans in the house are glad that this shutdown now is potentially done, but they're steamed it took so long. frank lobe ondoe says, quote: >> reporter: he also says he's going to try to get back pay for those workers idled by the stoppage. alisyn: that would be awfully nice, i should say. as you point out, it was just a couple of days ago the congress seemed to be at loggerheads about this, so what broke the

impasse? >> reporter: apparently, ray lahood had the power this whole time to grant waivers to those small airports whose subsidies had been holding up the entire deal. so he went ahead and did that, and now there's a deal. alisyn: okay, there you go. it's just that easy. [laughter] peter doocy, thanks so much. bill: boy, did they take to the microphone, didn't they? alisyn: it was right there. bill: all this partisan bickering not sitting well with the american people. 82% say they disapprove the way congress is handling its job. wow. that's the lowest rating since "the new york times" started asking that question way back in 1977. all right. alisyn: oh, boy. bill: eight minutes past the hour now, breaking news from overseas. alisyn: we have a fox news alert just in from syria. we're getting reports of tens of thousands of protesters pouring into the streets calling for the downfall of president assad's regime, this despite a deadly military siege that's ramping up in the city of hama.

[gunfire] this is brand new video in to our newsroom this morning. obviously, it's too dark to actually see what's happening, but you can hear the gunfire going off in the background. hama, as you know, has been under siege by syrian troops for six days now. secretary of state hillary clinton is accusing the government of killing more than 2,000 of it own people. >> the government is responsible for the deaths of more than 2,000 people. we continue to support the syrians themselves in their efforts to begin a peaceful and orderly transition to democracy. alisyn: well, the obama administration says it's moving to further isolate president assad and be his inner circle, clinton adds they're trying to gain international support for strong actions against him. bill: also breaking news out of

libya, was one of moammar gadhafi's sons killed today after an airstrike? rebel forces claim he was along with 31 others. the libyan government denies all of that. for its part nato saying it has no confirmation. that son is the commander of one of the best-trained and most loyal military units. we'll bring you more details as this story develops. it's been reported in the past that he was dead, and so far all those reports turned out to be false. so a little bit of caution right now if we can confirm it, we will one way or the other. alisyn: those are just a few of the stories we are following this morning in "america's newsroom." coming up, two big developments in the death of 11-year-old celina cass. why her stepfather was taken from the family home, and what investigators now say they found the day they discovered her body. bill: an awful story there. ronald reagan in office during the last double dip recession. did you remember that, america? the early '80s?

are we headed there again? we'll talk to his former economic adviser, art laffer, in minutes. alisyn: plus, two men pass a bus holding two assault rifles. you won't believe what happened next. >> at least five of the bullets came right through the back door. several of them then came through the back side. very clearly because she doesn't actually realize what's going on. she's sort of left stand anything the middle of us as everyone is standing all the way to the front or all the way to the back. are you receiving a payout from a legal settlement or annuity over 10 or even 20 years? call imperial structured settlements. the experts at imperial can convert your long-term payout into a lump sum of cash today.

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alisyn: sentencing hearings are underway in west texas for 55-year-old warren jeffs who was found guilty yesterday of sexually assaulting two girls whom he married. one in 12 years old, the other 15. he married them in what his polygamist sect calls, quote, spiritual marriages. while the jury will decide his punishment and prosecutors relied on detailed written records and audiotape to convict

him, they are now asking for a life sentence. bill: check out these numbers back here. history will tell you a whole lot about where we might be heading. the last double dip recession, the early 1980s. the first dip happened in 1980, the second dip from 1931-19 -- 1981-1982. unemployment went from 6.3% to 10.8, that's a blow outnumber, and inflation shot up 11% during the recession. my next guest worked as president reagan's economic adviser, art laffer's back with me out of nashville. good morning to you, art. >> good morning, bill. how are you? bill: i'm fine. we've come to you for answers. how do we get out of this? >> you've got to cut government spending. everyone talks about government spending creating jobs, bill, and that's not true. you can see that really clearly. if you have a two-person world, two farmers. if one of those farmers gets unemployment benefits, who do you think pays for them? it's the other farmer. government spending is taxation,

and the reason we have not recovered is because of the huge increase in government spending that is holding this economy back. it's really tragic, but we've got to bring that spending down and down fast to get it growing. bill: art, okay, go ahead with your last point, then want to ask you a little something about history. >> yeah. have you ever heard of a poor person spending himself into prosperity? it just doesn't make sense. bill: the first dip in 1980, i mentioned that. the second happened from 1981 to 1982, it covered a couple of quarters. unemployment shot through the roof, as i mentioned. and then the inflation was up more than 11%. history tells us a lot. what does that tell you as you remember it? >> in 1981 when we passed the tax bill and be we got the huge tax cuts which was in august, i think, of 1981, we phased in the tax cuts because they were all worried about deficits. they wanted not to have the tax cuts occur right away, so the tax cuts actually began in force

on january 1, 1983. it is amazing how tax cuts don't work until they takefect. take effect. if you knew they were going to cut tax rates next year, what would you do this year? you'd defer all the income you could. and then on january 1, 1983, the economy skyrocketed. if you look at my barron's article in 1981, i went through this really carefully. it was a huge mistake by the congress and by the president, but it worked in the long run. but it caused a deep recession of '81 and '82. bill: you mentioned 1983. as we look back, those were the boom years. gdp growth was incredible. fit quarter shot up 5.1%. man, what we wouldn't do for that now. 8.1 in the third quarter. and you believe it was only tax policy that had to do with with that? >> >> not only.

everything else was at work too. he did all sorts of things that were wonderful, but tax policy was key to the timing of that. by delaying those tax cuts, we caused the deep recession of '81-'82, and then the boom of '83-'84 was because those tax cuts took effect. but we would have had a very good economy because of paul volcker's monetary policy, regulatory policy, tax policy. it was all kicking in together which was reaganomics. bill: take us to 2011 now. do you see this white house changing policy that would go in that direction? >> no. unfortunately, i don't see them. they're so ideological. they just can't admit they're wrong. everyone knows that that government spending, it wasn't just obama, it was w. just as much as obama. it's bipartisan ignorance, but they just won't admit their mistake. if they'd admit the mistake, get that spending down, this economy could be booming, and we would have prosperity, but they just won't admit it. and it's tragic.

bill: maybe in the end you're wrong this time, we shall see. >> oh, i've been wrong a lot in my life, but i don't think i'm wrong in this one, bill. bill: art, thank you. art laffer out of nashville. thanks. alisyn: developments in this crime, police suspect foul play as they search the new hampshire home of 11-year-old celina cass, the new twist today in the case. bill: also he is known for his slogan, the rent is too damn high. turns out it really may be too high for jimmy mcmillan, and we will tell you why. >> it's a simple message, some say i'm a one-issue candidate, but it all boils down to one thing: rent. it's too damn high.

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bill: new developments now in the investigation of a young

girl's suspicious death. sue lean that cass' stepfather has checked into a mental health facility days after police hauled away his pickup truck. he's 37, said to have -- he's 47, and little celina was reportedly found wrap inside a blanket in a river near her home last week. so far not a single suspect or a person of interest has been identified by police. alisyn: breaking news for you now because just moments ago the probation hearing for casey anthony started. a florida judge expected to decide what to do about the order requiring her to return to florida and serve probation for check cashing fraud. fox's phil keating is live in orlando. phil, this hearing is about casey anthony, the convicted thief, not the acquitted murderer. >> reporter: right. and she was convicted, of course. one month ago today four counts of lying to investigators. since then she has not been seen publicly although tmz come

allegeddedly shot here in cincinnati, ohio. this is all about when she was awaiting the murder trial for her daughter, caylee. she pleaded guilty to six counts of check fraud, and this goes back to that 31-daytime period when caylee was missing, however, casey hadn't told anybody yet, and she was out partying it up and spending that money, and she was writing bogus checks out of her best friend's checkbook who happened to be out of town at the time. back in 2010 casey anthony pled guilty, and the judge sentenced her to 412 days in jail plus one year's probation after her release. however, there's been great confusion about that probation. alisyn: so do prosecutors want her to come back to florida to serve that probation, or do they agree with her legal team that she should not. >> reporter: they agree with jose baez and jay cheney mason. we have got judge perry back on the bench, but in the courtroom

you've got jose baez, casey anthony's attorney, and the prosecutors, linda drane burdick and her assistant, they're all together here and believe that since casey anthony was in jail denied bond, simply waiting for the pending murder trial, that year of probation, basically, has been accounted for, and the department of corrections also thought so. now, the judge, judge strickland, verbally said back in january of 2010 he wanted her to do a year's probation after she walks out of jail. however, he didn't write it down on the documents exactly that way, and that's what judge perry has to weigh, which has ultimate precedence here; his verbal opinion or the written word? alisyn: all right, phil. we'll be watching, let us know what happens. bill two days ago we thought we would see her back in that courtroom. alisyn: that was a possibility. bill: yes. then, not now. a shocking story that was not supposed to go this way. a comment on a woman's parenting turns into a gunfight, and you have to see how this thing plays

out. alisyn: my goodness. plus, high drama in the streets above san francisco. two window washers living on the edge, dangling from a building as the city holds its breath. >> right now it's dangling, however, we have it secured with ropes. we have it tied off, so it won't go anywhere. >> of course, it's always alarming when it's so close, and, you know, being right in front of you. [ male announcer ] at e-trade, low cost investing means getting a low price, plus the choice of every etf, 5-star research, and unmatched trading tools. there's price. there's value. don't confuse the two. e-trade. investing unleashed. aren't getting enough whole grain. but actually, it's never been easier to get the whole grain you want from your favorite big g cereals. from cheerios to lucky charms, there's whole grain in every box. make sure to look for the white check.

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bill: this is what we've been waiting for since 4:00 yesterday afternoon. that there, the opening bell on wall street after that thursday stock smackdown. today investors react to the questions about europe's economy, the expected growth here at home or lack of it in our economy, the new monthly jobs report came out 60 months ago. employers in july adding 117,000 jobs, that was slightly better than expected. many economists thought they would add 75,000, the number came in at 117. however, weeks from now wait for the revised number because we have seen time after time the revised figure is not as good as the initial news. analysis, now, on that. alisyn: let's bring in two of our best, gerri willis and charlie gasparino with the fox business network. charlie, it just opened seconds ago, and it seemed to be ticking up. >> reporter: we should have a pretty good day today. there was some sentiment the market was oversold yesterday, obviously. you know, i don't think you

should get -- and you can talk to this as well -- you don't get focused on all this sort of daily gyrations of jobs reports and everything. you have to look at the markets long term. we could have a 900-point -- 300-point day. alisyn: look at it, happy days are here again, i guess. why is that? because these jobs numbers are slightly better? >> reporter: perhaps the combination of both. keep in mind with those unemployment numbers, there were 193,000 of us who got out of the work force, got out of the business of looking for a job altogether. some folks are saying, i've been doing this so long, i don't believe i'm going to get a job. so that jobs number, it's good news, the glass is not completely full. >> reporter: you know, one of the smartest guys in the market once told me stock traders are morons. [laughter] they literally press the button on the headline. they don't think long term. it's just the way the stock market works. alisyn: 158 morons out there right now like it. >> reporter: i'm telling you, i talk to a lot of investors.

the trend is not good. when i talk to people who invest long term, sophisticated people, people who run wall street firms, they will tell you, you know, listen, the economy, there's nothing that gives them hope about the economy doing much better. we may be mired in 8.8, 9.2% unemployment, but what's going to get the economy going where you get people working and gdp grows, that's the sort of function that makes the markets grow. >> reporter: and, frankly, charlie, it it's the debt probl. yesterday started in europe, and that's where some of the biggest problems are. they're going to have to underdeliver -- >> reporter: i don't think it's a debt problem here. i think the markets are acting purely -- reacting purely to lack of growth. when we finally had an agreement, i really think people are worried about growth here. listen, we may have better growth going forward, we may not have 1% growth every quarter for the next year, but, you know, that doesn't do much to unemployment. >> reporter: i don't know, charlie. you know, when gdp is the same size as your debt, 100%, that's

not a good sign. >> reporter: well, if market is growing at 5%, if gdp's growing at 5%, it doesn't hurt as much. >> reporter: that's true. >> reporter: and that's why i think a lot of people worried about this debt deal having a negative impant on the markets and on gdp because it cuts so much. listen, there's a bigger problem here. people are not working, fiscal stimulus, keynesian stimulus, we just spend stuff, it didn't work. and washington is gridlocked to come up with a plan. alisyn: there was an interesting op-ed in "the new york times" today that argues back in 1987 under president reagan when there was that black monday stock market drop, president reagan's approval numbers didn't go down, in fact, they ticked up a point or two. do voters hold the president responsible for what's happening in the stock market, gerri? >> reporter: i think, look, what's going on in the economy is what's really hurting people right now, and that's what they're blaming the president for. i don't have a job, somebody in my family doesn't have a job, people are very frustrate with

the that, and they see the stock market as an extension of that. because, let's face it, it's your 401(k), it's your ira, the it's your savings for your kids' college education. alisyn: can that take a hit? >> reporter: the crash of '87 cooccurred for a lot of reasons. led the market a lot lore, but it's at predictive. george bush, the first george bush, came to office in a very weak economy. he paid for it because it looked like he didn't know how to handle it, and i think some of this gyration is, obviously, an indication that traders don't like this economy, and will this president pay for it? who knows. >> reporter: the one we just experienced ranked number ten, but in terms of percent, it wasn't that big a deal. >> reporter: how about if you added up all the days that went down? that's a lot. that's big. alisyn: so what are people supposed to do today with their money? >> reporter: don't listen to the idiots, traders. get past the noise of the market, do what's right for you.

you have to be in the market for the long term. now is not the time to be selling willy-nilly because, you know what? if you have a mutual fund, it takes you a day to unload. what if you sold it yesterday and now the market's up 155? >> reporter: i'm more bearish. i think you should be more in this crazy environment, which is a huge question mark, you should be more into cash. i don't give investment opinions, but i'm looking long term. do i think the economy's going to be much better a year from now, and the markets are a reflection of the economy? i don't know how you could say yes because you have fiscal policy gridlock in washington, and the fed just can't go in and print money anymore. >> reporter: and i would say a year is a short-term horizon. >> reporter: wait until you lose. alisyn: it's up 160 points right now, gerri, what do you think happens at the end of the close of business today? >> reporter: if i knew that, i'd be a wealthy woman. >> reporter: i predicted 500 today, and here's my prediction today. alisyn: yeah. >> up 300.

>> reporter: oh, happy day. >> reporter: and don't, don't use that -- alisyn: don't race out and buy things. [laughter] >> reporter: and by the way, don't listen to me, please. you're asking me for an opinion. alisyn: we were on this tape three minutes ago not to listen to you. will that lend new confidence with these slightly better jobs numbers, with the unemployment number ticking down to 9.1, with the possible stock market going up, will we have a little bit more confidence? >> reporter: no. long term i don't think there's good stuff which is why i would be more in cash now personally, not making a recommendation. because long term, listen, when you have fiscal policy gridlock, sometimes it's good. it's not good when you have 9.1% unemployment, you have very meager gdp growth. you need to get them together and do something. >> reporter: but that's just the problem. everybody says the things they've done aren't working and are making things worse. so more spending, you want them to spend more money? spending before didn't work. >> reporter: well, there's

other things you can do. republicans have a legitimate plan to close loopholes and lower tax rates. we haven't tried that yet. we haven't tried that since the second george bush did it. and by the way, unemployment went down. alisyn: 132 points up as we close this segment. charlie and gerri thanks for coming in. bill: i love the fact that you guys disagree. alisyn: a lot. [laughter] bill: right on. now to a different dip. high above the streets of san francisco two window washers dangling from a 16-story building after the scaffolding collapsed. firefighters on the scene, they raced there to get them and save them pulling one man to safety to the roof, the second brought through one of the building's windows. this was a close call. >> we heard some noise, but we didn't know what it was, and that's when we ran around here, and everybody was kind of pointing up like this guy's just praying. i was really hoping the other end wouldn't break because that means that whole contraption was

going to fall. bill: both workers are hospitalized, one has serious injuries. what's coming up? alisyn: two f-16s scramble when a small plane gets way too close to president obama. but you'll have to hear who was behind the controls of that plane. bill: also, how's your 401(k) feeling today, america? remember, you had to get the debt deal done otherwise the markets were going to give you all kinds of problems. well, they got the debt deal done, and still we have this -- >> we do not believe that this e is a threat there of a double dip recession. we believe that the economy will continue to grow. you could save a bundle with geico's multi-policy discount. geico, saving people money on more than just car insurance. ♪

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alisyn: 41 minutes past the hour, here's what's developing right now in "america's newsroom." two f-16 fighter jets forced to intercept a plane that was flown by a 75-year-old woman. the plane, like this one here, had entered restricted air space during president obama's recent trip to chicago, and it turns

out her plane did not have a radio forcing the jets to scramble. and virginia tech locked down for more than five hours yesterday. three juveniles reported seeing a man with a gun. the police searched the campus but found no man or any real leads. high school and university students taking to the streets and fighting riot police in chile. clashes breaking out over what students say are cut in the country's public education system. ♪ bill: so now to the politics of the economy, and there will be a lot of this. the white house fielding a ton of questions about jobs, as expected. >> what is the president doing? we know that he went to fundraisers last night. what is he doing, what is he doing -- [inaudible conversations] congress about all the stuff that needs to be done. >> that's right, and congress has within --

[inaudible conversations] congress has -- the president is having meetings with his senior staff. the president has called on congress to move quickly on things that have bipartisan support and are in congress' lap. >> the same things as a couple of month ago. >> congress has the power to pass legislation that the president can sign. bill: all right. that was that. doug schoen, former pollster for president clinton, and brad blakeman, former deputy assistant to george bush. gentlemen, it's great to have you both together. well come to both of you. got to tibet the debt keel -- get to debt deal done, guys. got to get the debt deal done, otherwise the markets are going to crash. they haven't crashed but, man, yesterday was a whipsaw. brad, after stimulus and health care and everything else over the past two and a half years, what can the white house say now about where they're taking the economy? >> well, the white house can say the president's actually going to do something about it, and the way he can do something is

to lead this economy in the fall and the 2012 budget. there's going to be another continuing resolution bill in the fall, you're going to see a huge fight over that. our government can't seem to pass a budge. our president was unable to do it when the democrats controlled both houses of congress and the white house last year. that's the next big battle looming, and what does the president do? he goes on a political bus tour. it's a job creation bus tour, but it's not creating jobs for the rest of us. bill: he's going to be out here in about an hour and 15 minutes. doug, what can we say? >> well, i think what he needs to do is a bold stroke. i think he needs to accept tim geithner's resignation, appoint somebody like erskine bowles who's got a plan to balance the budget, lower taxes, reform our antiquated tax code and create jobs. so i think brad's right, but i think the president needs to change course and change direction. bill: so you would get rid of tim geithner? >> that's what i said clearly,

unabashedly. bill: when did you start thinking that way? >> well, when i saw that he wants to go, and given the success or lack thereof that we've had with our financial be markets and financial conditions, today's numbers notwithstanding, i think it's the right time -- bill apparently, the president likes him. >> with well, that's good. bill: and they have a good relationship and a good rah port. brad, do you? is that the answer? is. >> no, i don't think it's the answer at this point because i think the markets want stability, they want confidence. look, the dell we know may be -- devil we know may be better than the one we don't. quite frankly, does the president really want senate hearings on the new nominee which will take up precious time from the economy? then there's a huge learning curve to get on the job, to learn the job and to be effective. so this president with 13 months to go to a national election would let tim geithner go, the guy who has been the backbone of the obama policies? i think it would be terrible political decisions for the

president to make, certainly creating lots of fodder for republicans. but really is it good for our country to go through a huge senate confirmation that is certainly going to garner so much attention and oxygen away from the good work that needs to be done? bill: and that might all be true, brad, but also it would give -- what doug is referring to -- the white house to pivot their policy entirely. [inaudible conversations] >> i don't think there's a prime minister, this president isn't capable of changing his policy. he's an i'd log. this sprt believes in what he's doing, and i think you're going to see the 2012 election as clear a disbetween democrat and republican as ever. bill: is the white house, is this president capable of changing? >> well, you know, he had not embraced fiscal discipline, he move inside that direction with the grand bargain with john boehner, and my point is he needs somebody like erskine bowles, a former chief of staff who was head of the bowles-simpson commission who's

been in the white house, who's headed the small business administration who can get confirmed by congress to hasten in a change in direction and position to revive a stalled administration that, as brad pointed out time and time again, is out of ideas. bill: as a democratic consultant, doug, can you point to one policy that came out of this white house in almost three years that has helped? >> um, you know, their argument is that they stabilized the financial markets with the stimulus. it's not something i buy, but you know what? it could have been worse, but that's not an argument for re-election, and it's not something i buy entirely. bill: would you buy that that, brad? >> i would buy that, but i think this president has to make such fundamental and dramatic change to his policy in order to help this economy, i don't think he's capable of doing it, i don't think he believes in it, and i don't think he's going to put people in there that feel that way. bill: time will tell. and we'll see him at 11:00

eastern time. doug and brad, thank you. alisyn: coming up, he said, "i'll be back," in the movie theaters. did you hear my impression? that was arnold schwarzenegger, and he's now returning from a self-imposed exile. we'll tell you what he's into. bill: she was only 20 years old when she was run down intentionally, and her killer, her own father, accused of running her over because she was too westernized. ahead, honor killing in america and a question of honor. >> 911 emergency? >> yes. i'm standing at 8990 west peoria avenue in the parking lot.

bill: incredible video on a sol cay though in hawaii. she's rumbling again, one of the world's most active going back to 1983. 1983's in the news a lot today. [laughter] alisyn: the '80s are making a comeback. bill: scientists says the lava flow poses no threat to people nearby, but it's a pretty picture at night. alisyn: we have some jaw-dropping video to show you of a wild shootout on a philadelphia bus. a woman on a bus gets offended after another passenger makes a comment about her spanking her son. well, she allegedly gets her revenge in a very violent way. our fox affiliate in philadelphia has this story. >> reporter: 20-year-old penny chapman has her hands full. you can see her on the route 47 bus heading north on 7th street. her son is running up and down the aisle. finally, she grabs the child and spanks him. the man sitting behind her threatens to turn her in for be child abuse.

she then makes a phone call, prosecutors say, to set up what's about to happen. minutes later she gets off the bus. the boy's uncle, angel, is waiting for them outside. he helps them off and then holds the door for these two guys. investigators say these brothers start firing into the bus with a large assault rifle and a handgun. watch the sheer terror onboard that bus. a mother grabs her 4-year-old son and runs for cover. a man sitting right by the back door is frozen and can only slump back in his seat. and this 80-year-old woman -- 80 years old o -- she doesn't know what to do. >> you see her very clearly because she doesn't actually realize what's going on, so she's sort of left stand anything the middle of the bus as everyone has sort of separated all the way to the front or the back. >> reporter: the elderly woman finally drops and covers her head just a minute before a bullet flies right over her. >> at least five of the bullets came right through the back door, several of them then came through the side.

>> reporter: many of the other passengers ran toward the front of the bus and piled on top of each other, desperate to get off. the man who criticized the parenting, the target of all those bullets, he dove right on top of that 4-year-old boy. the bus driver then gunned it and got out of there. alisyn: oh, my gosh. that was reporting from philadelphia. the cold-bloodedness of that. i mean, just firing into, randomly, into a bus. bill: that was a wild afternoon out of philadelphia. okay. we're watching right now in orlando, florida, the casey anthony hearing is underway. now, what's this all about, you ask? this is a question before the same judge, belle vin perry, to decide whether or not casey anthony should serve probation for a year for that check fraud conviction. or resume life without any legal restrictions. that's what the defense attorney, jose baez, back this court. she was not there, by the way. we were given an indication she would be required to appear. the judge said, no, you do not have to be here. the rumors are she's in ohio.

alisyn: and her defense lawyers argued it would be a danger to her safety because so many people are still angry about the verdict of her daughter's death. bill: she was found not guilty of all that, but she was convicted on these check fraud and related charges that, apparently, happened in january of 2010. so about a year and a half ago. so that's what this whole legal matter is about, and we'll let you know how this is resolved. if she's in ohio or florida, we don't know. we think she's in the buckeye state. alisyn: well, and she was wearing the hat. bill: the ohio state university. we'll watch that. alisyn: meanwhile, president obama set for a bus tour heading to the midwest. what he finds when he gets there, we're going to talk to ohio governor john kasich about the listening tour that's coming up. plus, a battle between the white house and the national rifle association. why the nra is suing the justice department.

[gunfire]

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bill: here we go, new hour and a "fox news alert." awaiting white house reaction to some -- what some believe might be a dill vsilver lining in the economic horizon, unemployment dropping slightly to 9.1%, down a tenth of a percent and we added 117,000 jobs and they expected about 75,000, and that number is a little higher and president obama will speak live, this hour and what will he say, any policy changes? all of that stuff, where are we and where we are headed. alisyn: he has a lot to say. we have a lot to hear at least. bill: i'm bill hemmer, good morning, how are you doing. >> well, i'm alisyn camerota in for martha maccallum. democrats and the president hoping these new numbers will calm fears of a double dip recession. but, republicans are not as optimistic, saying it is just not enough. bill: house speaker john boehner, today's unemployment report is more proof that all the washington spending, taking and regulating is devastating our economy.

while the american people are asking where are the jobs, the democrats running washington are determined to punish small businesses with higher taxes, and more red tape. neil cavuto, managing editor of fox business news and anchor of "your world", neil, good morning to you. >> good morning, buddy. bill: with a big, broad brush, where are we as a nation? and where are we headed? >> well, we are still heading into a slowdown. the jobs report is not really great. i think we were expecting something so awful, sort of like when you are banged up side the head again and again and again and when the person stops banging up side your head you feel like you are cured but are still getting banged up side the house and we're still in a world of hurt. the economy clearly slowing down and we are still looking at a 9-plus percent unemployment rate and now, we have got concerns about a contagion in europe, that is spreading, and that has nothing to do with what we are doing here. but, everything to do with

whether it will reverberate back here. i want you to focus on a guy named silvio berlusconi and it might seem like i'm making a leap here, but the italian leader said today, a while ago, believe in our bonds and believe in italian bonds, they are just fine, don't worry about all of the talk. we're going to hell in a hand basket, i am paraphrasing here and the bonds quickly tanked. italy is in trouble. talk that it might need a bailout and here we go again. and that market was down north of 3%, close to 7% of the value the last couple of days and i mentioned italy, bill, if it were to need a rescue or bailout, something berlusconi says is not necessary, but the financial high and mighty in his country seem to differ, then you are looking at serious trouble. italy is three times as big an economy as greece and the 8th largest economy in the world and it is the third largest issuer of bonds on the planet.

so, all of a sudden, you get the italians in disarray, on top of talk that the spaniards are in disarray, on top of talk that portugal is in trouble again, ireland could be hiccupping again, then you've got a continental crash in the making and we are nowhere near that, i want to stress that but that is a big reason why what had been gains in the dow were quickly reversed on fears that regardless of our employment situation, europe is in a real bad place. bill: and a reminder, greece got $12 billion recently, primarily from the french and germans and, if you are going to help italy, if we go... >> they don't have the money, that is it. there is only so much money in the till and angela merkel, the leader of germany said, in the nicest terms, you know, there is only so much we can do and we can't bail out everybody here. so, if they all come with a tin cup, who will fill it? bill: i'll take you back a year ago. august 2nd, 2010.

"new york times" editorial, tim geithner wrote it. welcome to the recovery. now, how do they explain this? because you know the questions will not end, especially after what we saw yesterday. >> well, they were looking at numbers that were beginning to improve. remember, we officially came out of the last recession, we are told, in june 2009, so by around july, august, 2010, the feeling was, that we were getting a steadier drum beat of better economic news. and not across the board but enough better news, and i stress, not great news, but better news the administration and tim geithner at the time were convinced we had rounded the bend. and the fact of the matter was, though, we were still piling on the debt. and, that left out what was happening in europe. and, that it was just sort of patching itself together and we were funding those efforts, to help patch it together. and to say nothing of our

expensive for ray in the health care and, i am not here politically judging and we didn't that he have money, wherewithal or financial expertise to plan it out and the proof is in the pudding here. it turns out we couldn't pay our bills and couldn't map it out, and we were in a world of hurt. bill: we are treading water on the dow 30, off 26 points, neil, thank you. >> sure. bill: catch neil every afternoon, 4:00 around time on your world and, tune in for a special live business segment this weekend, on the break, answers from the abyss, saturday morning, 10:00 a.m. through noon, eastern, neil with a terrific group of folks to help you guide -- guide you through the process. alisyn: what is the white house reaction to all of this? we expect to find out when president obama speaks at the top of the hour. chief white house correspondent ed henry joins me now, live. ed, has the white house talked about these job numbers yet?

>> reporter: well, aides are talking about it at least privately and as you said, the president will speak at a military base in a local area, because he wants to put a spotlight on the fact that a lot of our military veterans are having an even harder time than many other americans, unemployment among military veterans returning home to the u.s., far worse than the rest of the country and wants to put a spotlight on that and you can bet he'll also comment and what we are hearing on the broader issue, is, look, this is some encouraging news but they realize there's a lot mr. work that needs to be done, and they are looking at a range of options to try to really kick-start job creation, but, you know, they basically say, when you listen to jay carney, his spokesman, there is not one thing that could fix this. take a listen: >> i said yesterday, as i said yesterday, there is no silver bullet and i have not heard one proposed by anyone in washington or beyond, that there is a silver bullet to help our

economy grow faster, or create jobs. >> now, the other thing the president's top aides are saying, right now, this morning, is, look, this means because of these encouraging numbers, that it is less likely there will be a double-dip recession, something we have been hearing, a lot about the last couple of days, because, they say, look, at least job creation is in positive territory, but, they also acknowledge it has to do a heck of a lot better for the unemployment rate to come down sharply, alisyn? alisyn: we heard jay carney say there is no silver bullet and everybody would agree. is there any plan? are there any ideas for jobs? >> reporter: they are talking about what i would call bite sized plans, smaller initiatives, like a payroll tax cut extension and that will expire soon and means a thousand dollars in the pocket of average americans, and they want to make sure that that is done and they are talking about patent reform, to help companies innovate and they are talking also, about trade deals, that are pending on capitol hill, but, let's face it, all of those individually are not going to turn the job

market around, in a big way, like they tried to do with the stimulus, at the beginning, because, frankly, the federal government is out of money to come up with a massive initiative, alisyn. alisyn: we need a meal, not just bite sized portions. >> reporter: that's right! supersize. alisyn: we want supersize, supersize the economy. bill: at the moment we're a long way from the buffet, this month the white house says the president will go on a bus tour, listening tour of the heartland, states hit hard by the bad economy and could make or break his re-election, frankly, in 20 minutes on "america's newsroom," john kasich is our guest, what does the president need know about what is happening in his state? don't miss that. alisyn: here's a question. did the u.s. government cut a deal allowing a violent mexican drug cartel to smuggle drugs over the border? in exchange for intelligence on rival drug gangs? that is the new allegation from a high-ranking cartel member.

william lajeunesse is live in los angeles with more on that. tell us exactly what the allegations are, william. >> reporter: well, the claim is not only did the u.s. government send guns south of the border, to the cartel, as part of operation fast and furious but the documents say that the u.s. allowed tons of cocaine to come north as part of a deal to be cut with the cartel. and the allegation is made in a defense motion by a high rp ranking member of the cartel indicted on federal charges held in chicago and he and the cartel's lawyer acted as dea informants and provided intelligence against rival drug organizations in exchange, the u.s. not only allowed the cartel drug lords to come into the u.s. but we withheld information from mexican police on the whereabouts of the cartel's leaders, including the father

and, the most wanted man in mexico and both are fugitives and many speculate the reason they are free is because they have been tipped off in the past and the dea, and u.s. attorneys office will not comment. now, in pleadings, however, the u.s. does not say that he was not an informant, only that he did not act, with their content and basically this is an attempt by the defense to get at dea records, that would explain our dealings with the cartel, and, maybe get the agents on the stand. alisyn: do we know who allegedly made the deal or authorized it? >> reporter: right, well the first deal was allegedly cut bye-bby the lawyer for the cartel and he became a dea informant, according to the records and the justice department had dropped the case against him, in 2008. now, he allegedly fed the dea information from other cartel leaders and later the dea wanted to get closer to them and so

they set up a meeting at the sheridan hotel, mexico city and two dea agents, manny and david, allegedly gave him immune and i'm quoting now from the pleadings: quote, the cartel was given carte blanche to continue to smuggle tons of illicit drugs into the united states, and were protected from arrest and prosecution in return for providing information on rival cartels and experts we spoke to in this say typically when we use informants we have a written agreement and they doubt there is one in this case, but as a show of good faith we maybe did allow drugs into the u.s., and the former dea director, karen tandy, who our department of justice producer reached out to, says and i'm quoting, i do not have any knowledge of this and it doesn't sound right from my experience. we will see what happens as a result of this, and, where the pleadings go in this case in chicago. alisyn: william lajeunesse, thanks for bringing this to our attention. bill: now the feds saying it is trying to curb illegal gun trafficking, especially along

the southern border with mexico, but, new regulations have the national rifle association all fired up. tell you about that. alisyn: and a woman's purse is stolen and a week later she had it back plus ten bucks and guess how she got it back. bill: a great answer, too. and the main ingredient in a recipe for life on another planet. is this the first new evidence in a decade of water on mars? are you receiving a payout from a legal settlement or annuity over 10 or even 20 years?

call imperial structured settlements. the experts at imperial can convert your long-term payout into a lump sum of cash today. when they taste the food that you cooked, it does something to your heart. i think what people like most about the grilled food is the taste. the flavor comes from that oak wood. the shmp, the fresh fish, the steaks. it locks in the flavor, it seals in the juices so that when you put the fork in it, it just goes through it like butter. it's beautiful. [ laughs ] i'm proud to be a grill master. i love food. my name is charles himple. i'm a red lobst grill master, and i sea food differently. excuse me? my grandfather was born in this village.

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decade ago but this is the first time they found any suggestion water exists as an actual liquid there. bill: kind of a cool sight. if you look closely and we're awaiting the launch of nasa's mission to jupiter. the atlas rocket, there on the launch pad, set to take off in about, an hour or so, and it is carrying a robotic explorer named juneau to take five years to reach the largest planet in the solar system and nasa hopes to find out how in the world jupiter was born. and other stuff along the way. stuff that relates directly to jupiter and how it came to be. that is coming up. alisyn: now a battle over gun rights, the national rifle association is suing the obama administration, over new regulations that require gun dealers along the border with mexico, to report multiple rifle sales to a single person. the new measures come months after the atf botched gun running stick fast and fewer yes was uncovered and the executive

vice president and ceo of the national rifle association joins me, mr. laperriere, thanks for being here. >> thanks for having me. alisyn: the administration as we said wants gun shop owners along the southwest border to have to report, if somebody comes in and keeps asking for semi-automatic rifles, the administration wants to know about that. what is wrong with that? >> this administration from the time they came in have been trying to blame the drug cartels in mexico, their actions, on the second amendment in the united states and in their desire to push more gun legislation here in the u.s. and it's not true, and everyone now admits the drug cartels in mexico are getting their guns from russia, china, and defects from the mexican army, the international black market, and largely through central america, and wikileaks the cables from our own state department prove that. bil alisyn: are you saying no semi-automatic guns from u.s. and from the southwest border are falling into the hand of mexican criminals? >> you know, there may be a

small-time operator coming in, trying to break the law, they ought to be prosecuted. but, our own state department cables say the mexican drug cartels are not getting their guns from the u.s., they are getting them from central america and are not getting them from u.s. dealers and they went to congress and tried to get gun bans enact on that premise and congress said, no way and now they are trying to bypass congress and circumvent the law and usurp the authority of congress and they don't have the authority to do the back-door rule making and are trying say any american who wants to exercise their constitutional rights to buy a long gun more than twice in the same week will do back-door registration and they want to fight with the nra, they've got it. alisyn: isn't it possible in light of the disastrous operation, fast and furious that came to light, now the administration is trying to track guns more carefully and take more responsibility? >> no, what they are really trying to do is change the subject from the fast and

furious operation, where, you have a large, what amounts to a criminal controversy, coming out of the obama justice department to run thousands and thousands of guns, directly into the hands of the evil people in the mexican drug cartels and our own law enforcement people have been killed, and, hundreds of people on the mexican side of the border have been killed and they are trying to -- caught trying to manipulate public opinion and trying to ruin the reputation of honest dealers in the country where the justice department told them to sell these guns, actually overrode the instant check system to make it happen, and when it started to come out, a massive cover-up is underway. my gosh, i mean, what needs to happen here, this is the biggest scandal involving the department of justice in my lifetime. the attorney general needs to be fired, a special prosecutor needs to be appointed, because, this can't stand. alisyn: in terms... back to the law you are -- filed against the justice department, the justice

department says that this program of the reporting multiple sales of the semi-automatic rifles, only pertains to arizona, california, new mexico, and texas. why don't you believe that? why do you think it would become a nationwide program. >> it doesn't matter what state it applies to. it is a meaningless form that will do absolutely nothing except hit the law abide, people and close back door registration on them and my god, the mexican drug cartels, alisyn, have 40 to $50 billion and they rape, rob, kill, murder, they assassinate and throw their enemies into lion pits and this administration, that is dropping prosecution of gun laws, to the lowest level since 2000, now says we will stop these evil drug cartels with a form? that must be some form. there is not a drug cartel member that is losing any sleep over this and they've already got an instant check. prosecute that. does two guns make it worse.

alisyn: wayne laperriere, thanks for coming en with your perspective on this. we appreciate night thanks for having me. bill: this is easy. after all of that hot air going back and forth about the faa an layoffs and furloughs and thousands of workers, the u.s. senate during the august recess, just passed an extension of that bill, that had been passed by the house two weeks ago, and it was just passed to give an extension until mid september. all right, they say they are being slaughtered like sheep. [gunfire] bill: this is out of the country of seyria, protesters under siee and where is the u.n. and better yet, where is the united states on this? alisyn: and she was a beautiful young iraqi immigrant killed by her father because he feared that she was becoming too american. and that is the theory and a fox news investigation, investigates that, a question of honor.

>> in the front yard, with his wife, demanding to see his daughter. and he start talking about how he was angry with her becoming too westernized and began to tell us that his family law was higher than our state law. getting a low price, plus the choice of every etf, 5-star research, and unmatched trading tools. there's price. there's value. don't confuse the two. e-trade. investing unleashed. [ male announcer ] this is what it's like getting an amazing discount on a hotel with travelocity's top secret hotels. the easy way to get unpublished discounts of up to 55% off top hotels. harpist not included. ♪ harpist not included. at exxon and mobil, we engineer smart gasoline that works at the molecular level to help your engine run more smoothly by helping remove deposits and cleaning up intake valves. so when you fill up at an exxon or mobil station, you can rest assured we help your engine run more smoothly

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alisyn: here's what's developing now in "america's newsroom," a probation hearing for casey anthony in orlando, a corrections official just testifying that she already served probation for a stolen check conviction while awaiting her murder trial, and, he is being evicted, telling "the new york post" his landlord wants him to pay more than $872 he currently pays for a rent controlled apartment. >> times are tough, huh?

breaking news out of the middle east. watch the story now, one protester in syria saying they are, quote, slaughtered like sheep by their own government. [gunfire]. bill: the u.s. state department, a fresh call on the international community to isolate syria's regime, so far, that, frankly, has not worked. at all. the president and founder of the american-islamic forum for democracy out of phoenix, doctor, good morning to you. >> good morning. bill: what can and should the u.s. do about this, when hillary clinton says more than 2,000 syrians have already been murdered in their own streets? >> well, bill, many of us from the syrian community and our families came here to seek freedom and we are seeing what is happening before our eyes, many of my friends speak to their families, in homes surrounded by tanks and, food and electricity has been cut off, as you said, they are being slaughtered and shot in the streets, simply for speaking up against their government, and, i

never thought -- we never thought such a thing could happen in 2011, with out the world doing everything in its power to stop it from happening and to put full economic sanction, not just some, but full and remove our diplomats and kick the syrian diploma out of our soil and come together in the united world global community and say the syrian... it is out of the tradition of hitler and what he's doing is wrong and we are basically... bill: why is that? why is that? because it is arm's length so far and your parents are born in syria. why is the policy this way? or does it show the limited reach of the u.s. government today? >> well, i truly believe we have a lot more power than this administration is wielding, not only the power of moral conscience, what we should do, what is right and the power of the fact, there is nothing more valuable to america's strategic interest, than changing the law in iran and there is nothing

that could stabilize the area more than getting rid of assad, and, they need to form a syrian democratic coalition and washington should say, you know what? assets should go now and they are not saying it and it is weakening us and look at why america is not feared and why america is dismissed in the world, and the polls are down, it is because of our lack of moral clarity and lack of leadership and we are seeing our families suffering, bill, and nobody is doing anything and paying anything attention to it. bill: you are in touch weather a lot of people in syria, as you, and doctor you are part of a fox news investigation that will air for the first time this weekend, saturday night, in fact and we investigate the tragic death of a 20-year-old iraqi immigrant in arizona, a young woman, run over by her own father. what we're about to watch and here is the interrogation between police and the accused father. listen here:

bill: there is so much more, the interrogation is revealing you will talk about in snegs, you have talked about honor killings for year and the special is called "a question of honor" because the outcome is not what viewers may think and having said that, what do you think americans need to know and understand about honor killings? >> we have taken on the issue as

one of the many as far as islamic reform, because, it really is a telling teaching moment, these cases. there are over 5,000 women a year, targeted by their brothers or their fathers as part of so-called honor killing, and it is not the islam i know or every muslim i know practices but there are many muslims who believe if a woman is... drinks or performs in a way that is uncharacteristic to their values, then she should be punished and the punishment should be meted out by her father or brother and in this case we saw, as you heard him horrifically say, she should be put out like a fire and it is misogyny and the treatment of women and we state in phoenix and this case has a lot of teaching components and we can look at how to address the issue, both within the muslim community, and, also, as a country, as a free nation, that

believes in the equal rights for men and women. bill: and our court system, too, and as you give the answer, we also found many people who directly disagree with that position and i think that that is part of what so many will find fascinating about this investigation, on saturday night. doctor, thank you, there, in phoenix, arizona, and join me over the weekend, saturday night. fox news reporting "a question of honor", 10:00 eastern time, right here on the fox news channel. alisyn: i'm looking forward to seeing that, bill. looks great. all right, is the governator back? a few weeks after his marriage crumbled on the international stage, what is he doing now? bill: also, packing the bag, hitting the highway, president obama will go to the heartland, a part of the country that is changed dramatically in three years and chances are, ohio will be a pivotal pit stop and the buckeye state governor, john

cas kasich, and he'll tell us what he'll find, on main street america. so, what are we going to do with this? i don't know. the usual? [ blower whirring ] sometimes it pays to switch things up. my - what, my hair? no. car insurance. i switched to progressive and they gave me discounts r the time i spent with my old compan saved a nch. that's a reason to switch. big savings -- it's a good look for you. [ blower whirring ] [blower stops] the safety was off. out there with a better way. now, that's progressive. vrrooom...vrrroooomm vroom vrrooom vrrroooomm

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alisyn: "fox news alert," we are awaiting white house reaction to the new report on unemployment and the president is set to speak within the hour. he's going to talk to veterans about the ailing jobs market and he's expected to touch on the

small drop in jobless claims. as the markets take notice of the numbers, right now, early morning, it is up, 9 points, 10 points, jumping around a bit and, had been up 160 points, but it has gone down since the high and of course we'll go live to the president, when he takes the microphone. bill: treading water. alisyn: it is. bill: a lot of folks are treading water, and president obama will meet many of them on a lightning tour of the midwest in ten days and he'll talk to folks, struggling in this economy and one of the hardest hit areas of the nation, and that is the midwest, what do the governors in america's heartland have to say about that? we're joined by ohio governor, john kasich out of columbus and sir, thanks for coming back here, appreciate your time. i think that one of the most i.... a buckeye myself, one of the most under reported stories in this nation is how life changed fundamentally for so many in

states like illinois, michigan, ohio, parts of pennsylvania, you might take that to west virginia, parts of kentucky and the state of missouri as well. where do you go in the midwest, today, to find good news? >> well, bill, we have good news here. you know? when i became governor we had an $8 billion budget deficit. and, working with my colleagues in the legislature, we eliminated are $8 billion budget deficit. and here's what is interesting. while we just saw minnesota have its credit rating downgraded, ohio's credit outlook actually improved, s&p moved us from on watch to stable, which means that outside forces are beginning to say that ohio is getting its act together and we eliminated our structural deficit and also cut taxes at the same time, and, eliminated an $8 billion deficit. at the same time, we have a cabinet that is business friendly and we will do regulation, but we will not do

regulation in a careless way, that stomps out jobs and at the same time, we've privatized our development department and we are now moving at the speed of business. i mean, just yesterday it was announced that wendy's is leaving george athe corporate headquarters to come back to its home in columbus, ohio and we are starting to see good things happening. bill: now, on that point, bill, i'm trying to apply a lot of this, too, it is anecdotal but it is significant. why is wendy's coming back to columbus, ohio. >> we met with them early on and told them what we were about as an administration and offered them some incentives, that ultimately return positive for the taxpayers of the state which helps them to lower their costs, but, we were engaged with them and we told them we could provide stability. bill, here's the problem we have. the problem we have is-off got all of these regulations, sitting out there. i mean, and, some that have not yet been enacted, and it is paralyzing business. and what we see in ohio is this:

we see some very good things, but we also see very slow things, happening in the economy. if you talk to people who are in the banking business and who make loans to people, they are very concerned about the uncertainty out there. and, when people are concerned, they sit on the sidelines. think about it. companies, apple has more cash on hand, than the u.s. government. the fact of the matter is, businesses are sitting on the sidelines because of the possibility of higher taxes, more uncertainty and more regulations. we have to deal with this. when we are dealing with it in ohio we are doing better when they paper over their problems in minnesota and they got hammered. it's not complicated. bill: you are painting a -- kind of a resrosy scenario in your se and you have gotten great reviews in the "wall street journal" and, newspapers in ohio, have applauded what you have done but unemployment is high, 8.8%, slightly lower than national average. >> yes. bill: is that something to praise or sing about, governor?

>> no. hey, bill, ohio lost more jobs in the last ten years, than every state in america except for michigan. which had the auto problem and california, which is filled with a bunch of backwack-a-doodles, i'm telling you i'm not running a marathon in ohio but i believe, balancing our budget and improving our credit and being business friendly is helping but you don't dig out of a mess like this overnight. the question, though, sort of like with the president. if he'd look at what he has been doing, which we were doing in ohio, overregulating and overtaxing, it hurts you and if you can deregulate and lower the cost of doing business it helps you. bill: it is not that complicated. do you think... i understand that and, indeed you do. do you think the president is keen on that? that he would make a pivot like that, and go in the direction you describe? >> probably not.

and that... probably not. that is why people are nervous about the long term. it would be fantastic if he would begin to say that he is going to freeze some of these regulations and take another look at it, it would be fantastic if he'd say we would not raise taxes on involvement, you know, capital gains or dividends, we're not going to, you know, raise the marginal rates in this country, if he'd say that, and look, that is part of what he did when he extended the bush tax cuts and what happened? he got positive, got positive news, positive response, and, they just haven't done enough of it, bill and it is hard for them, because they have a different philosophy. they think government is the answer, and not the problem. and i don't think government is always a problem but, too much of it is not good. bill: we'll hear from him in 20 minutes and see the address then live. governor, as always, thank you. john kasich, the governor of ohio, you've got your work cut out for you, just like michigan and indiana, and illinois, and wisconsin and all of this will

be seen by the president, first hand. thanks. >> we are heading up, bill, finally heading up. bill: i like the optimism, i home you are right. alisyn: arnold schwarzenegger back in the public eye, the former governor of california making his first speech in the golden state, since confirming that he fathered a son with his former housekeeper and, he certainly has not lost his sense of humor, here he is, speaking about his future plans: >> i'm going to run for president of the national body building association. [laughter]. >> very good, it will go over, very well. alisyn: the former governor will play a border town sheriff, battling a notorious drug kingpin in an upcoming movie. appropriately titled, "last stand." he is getting back into the movies, after he was taking the hiatus after all the personal problems. bill: the comeback. alisyn: i guess so. bill: i wonder what maria thinks about that. no comment, a little girl adopted three years ago by a

missouri couple has been living in the u.s. since '08 and now is ordered back to her birth parents in guatemala. we have a legal panel on the heartbreaking story and we'll take you through that. alisyn: he stole a purse and a pricey gps device from a woman and a week later the victim gets it back with ten bucks more than she had in her wallet. figure that one out. let me tell you about a very important phone call i made.

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mr. sobel. thanks for coming in, i want to start with you. her missouri parents thought they had adopted her legally, fair and square and she's their daughter and they have been raising her, loving her and caring for her, must they give her back? >> they do. they have to give her back. there are two types of matters this case could fall un, if it was a case where the parents, biological parents said we gave up the child but didn't mean to, doesn't under false pretenses or there was a biological father who said i didn't know about the child the court would say, let's look at what is best for the child and, the parents flew or should have known and this is not the case, the child was kidnapped and no one questions that and, public policy says, international policy says, no one has an interest in supporting someone committing a crime and stealing someone's child. you have to give the child back. alisyn: do you agree? does she have to go back. >> she raises good points,

however i'm in disagreement and here's why. what you have to do is balance the equities here and ultimately, everyone here is an innocent party including the child, but, only the kidnapper, let me briefly explain, the biological parents, they did nothing wrong and their child was kidnapped and the child is a precious child and this did nothing wrong and the adoptive parents, alisyn, did nothing wrong and what do we have to look at? the fact that the child has been here, for three years, and they have bonded with the parents that are the new adoptive parents and have been socialized and have been... the daughter, you know, in terms of school and friends and everything else, and it would be horrific, a tragedy, compounded indeed, if we now were to strip the adoptive parents of the rights to the child they've cared for so greatly in that three-year period of time and simply return her back to guatemala. alisyn: and, obviously e. >>y mak-- joey makes the pointe it will be traumatic, she doesn't remember and doesn't speak the language any more, is there no way to do something else, share custody of the little girl, have her be both

places, and visitation? >> the reality is, she'll be traumatized and he's right about almost everything he said and the child was taken from her home, twice, this is the second time she has been torn from her environment but the bottom line the u.s. will not risk an international incident especially when thousands of children are coming to the country, every year, and it sounds like this is an ongoing issue of kidnapping children out of the country. >> you know what it is, trenny? i understand that, in terms of the international incident but there doesn't need to be one, the fact is we have to put the child first and i feel really badly, of course, we all feel done -- >> applicable resolution, what would that be. >> it is, and you alluded to it a little bit. alisyn, you cannot cut off the biological parents completely, but a biological mother has to understand the trauma, the child was kidnapped, at two, two years go by and ultimately the adoptive parents have, if the child was 2 then, the child is 7 now, five years since the

daughter has seen their birth parents. and, so, as a result, i doubt the child would know who they are and, so, we have to put the child's interests first and keep the child here and let the child be developed and groomed here and have a wonderful life here. alisyn: joey jackson, trenny stovall, thanks for both of your perspectives, a sad story but we'll follow it and see what happens. >> pleasure, alisyn. bill: a quick check on what is on on "happening now", jenna lee has a preview. >> the white house is calling the jobs numbers today a call to action. we talk to the president's head economic advisor, to explain why and, plus, why are we giving boat loads of money to help develop china's economy? senator jim webb is calling on congress to end our aid, we'll talk to him live and does the debt deal solve our problems or just prolong the pain? senator alan simpson, co-chair of the debt commission says the deal is a basic band-aid and he's a notorious straight shooter as you know, bill, we have no idea what he'll say and he'll be on with us, live.

bill: stay tuned for that. thanks, see you at the top of the hour, breaking news out of orlando, an update on the casey anthony hearing. we will tell you about that, in a moment.

bill: breaking news out of orlando, no decision today, the word from judge, on the question of casey anthony's probation. she was not there in florida, she was not in court, now we await the judge to have a bit more time maybe over the weekend, maybe beyond that, we'll wait and see, live update there, from orlando. another news ash llert, wai on the president, the first remarks since the jobs numbers came out and the first remarks since the dow tanked on thursday, closing down more than 500 points. we expect some sort of count on

the economy and republicans are running against him and, now are chipping in with their opinions and carl cameron has been in touch with that. live to d.c., where do you want to start? the president's message or what they say on the trail. >> reporter: they think the president's message will be to try to say it is time to get things started and take the job numbers today and the market collapse to really get things going and the republicans are welcoming a slightly better jobs numbers today, and, the markets were spooked, and, most of the other news was lousy, so, front-runner, mitt romney, was casting himself as the most experienced and public and private sector jobs and economic guy before that and went after the president in a statement a while ago, basically, that said when you see what the president has done to the economy, in just three years, you know why america doesn't want to find out what he can do in 8, and jon huntsman slams mitt romney for having one of the worst job records in the country when he was governor of massachusetts and in his statement about the jobs numbers said, the president had two-and-a-half years to turn

around the american economy and it is clear he failed, in less than one day americans witnessed a considerable drop in the stock market and yet another jobs report showing unemployment rate above 9% and michigan shell bachman pointed to the free fall of wall street, as proof the president's policies are causing the turmoil and said, you cannot fool the markets, mr. president. the only way to dig us out of the hole, is to stop digging. and, tim pawlenty, looking for a breakout moment in the fox debate and straw poll and, quote, president obama failed to deliver a concrete plan to create jobs and promote growth, and, the lack of leadership is inexcusable and driving our economy toward decline. we'll hear from the president, in a few minutes. better news, doesn't change the dynamics, though. bill: can you say which of these candidates in the t20 seconds i have left is drawing the greatest contrast with white house policy, or are there too many similarities that cross each candidate. >> reporter: they are largely similar and jon huntsman

distinguished himself a little by being more inclined to a debt deal than the rest of the republican but they all expressed dis satisfaction and generally speaking the republicans expect the election to turn their way because of how the economy seems to be turning politically against the president. bill: thank you for that. we'll await that. carl cameron, in washington. alisyn: we are awaiting white house react to the new unemployment numbers and the market is already reacting and we have a live at the dow, right now, down 48 points, and, it had been up, earlier, about an hour ago, to 160 points and is jumping around. and, what will the president say about this? we'll be live in washington. ne l of your missed opportunities in one place. the winning horse you could have picked. ♪ that "old flame" you should have called. ♪ that leap of faith you never took. but there's one opportunity that's too good to miss. the lexus golden opportunity sales event, with exceptional values on the lexus is. but only until september 6th. see your lexus dealer.

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bill: so we have a thief caught on tape. no big deal, happens all the time. steal ago woman's wallet, but that's the bad part. a week later the suspect shows up at her front door and hands the wallet back to her with the missing money plus $10. he also offered a note apologizing and signed it, stupid. [laughter] alisyn: a chifl rouse thief