with evil. we have to defeat it. good to see you guys. have a great night. let not your heart be troubled. we will see you back here tomorrow night. greta: stimulus 2.0. is that what we need? another stimulus package? another stimulus bill? a really smart idea or a dumb one? and an obsession. governor sarah palin. yes, david letterman did it again, making cracks at the governor's expense. we will play the tape. and is north korea doing something? the pentagon is pointing fingers right at north korea. that, of course, coming up, but, first, it is a second stimulus package coming? house majority leader steny hoyer and chris dodd are not ruling out the idea. what are they saying on the other side of the aisle? joining us is mitch mcconnell,

senate minority leader. >> good to be with you, greta. greta: how much are we spending on interest on the first one? do you have any idea? >> about $100 million a day on the first one in interest. greta: each day, we are spending that to support the first one? >> yes, and this fiscal year, we are spending -- we have an $800 billion greater deficit at the end of the third quarter of the fiscal quarter we are currently in that ends september 30 than we did last year. we are spending like drunken sailors. greta: there are some democrats that are talking about it, but they are not wedded to it. >> we had a great saying down in kentucky. we passed the first stimulus on the representation the president made that it would keep

unemployment from going above 8%. well, now we know it is going to go above 10%, and we just discussed the amount of interest we are paying on this rubicon matter. it is truly astonishing. greta: need hundred 70 guys dollars billion -- $875 billion that was passed. are there any signs that is working? >> not yet. what was done with most of the money, according to the gao, is that the states have used it to plug a hole in their budgets, so they used car borrowed money to prevent them from having to make the tough decisions that they would otherwise have to make -- so they used our borrowed money. greta: it creates jobs, and generates incomes, not to pay off what you owe. it was not to pay off expenses. >> finally, it targeted,

temporary. it is obviously not targetted, temporary, -- timely, targeted, temporary. it is obviously not those. greta: do you have some sort of a discussion about that? i guess they call you mitch. do they say that to you? >> they are trying to defend it, but you saw the reaction of some of the democrats, including my counterpart gary re-. -- harry reid. greta: a second stimulus? >> i sure hope not. greta: are there any sort of cheering this on? >> well, i think they are clearly floating a trial balloon. they are thinking about it, and you have larry summers at the white house throwing out the possibility, so they wanted to send out a trial balloon.

i think based on the evidence of the first one so far, i cannot imagine that they could pull this off. greta: what would you do? >> look, what we would have done at the beginning at about half the cost which would have gone straight at the housing problem, we would put money directly back in the pockets of middle and lower-income people through tax relief. immediate tax relief. it would have shown up in their paychecks right then. greta: was holding. >> we would have lowered the rates immediately -- withholding. we would have gone straight at the housing problem, which is what started this problem. greta: that would have been a really fast thrust of money, the withholding. >> it just depends on how much money you want to put back in, but putting the government in charge of the spending guarantees that it does not do anything quickly.

greta: all right, we now give this week to we now have is $875 billion stimulus bill -- all right, we now have this $875 billion stimulus bill. >> we have car companies, student loans, and now, on top of all of this, and they want to take over the american health- care system. greta banks and automobiles. so what would you do right now -- greta: banks and automobiles. what would you do right now? we are here, so we have to deal with it. >> the way to reverse it is to put more money directly into people's pockets. we are a consumer-driven economy. two thirds of our economy typically is consumer driven. borrowing all of this money and having the government involved in so many areas of our economy -- it would have been a lot

simpler, a lot quicker, and a lot more effective to put money back into the pockets of the american taxpayers. greta: so we could still do this? >> we need to get out of the car business, get out of the banking business, get out of the insurance business, get out of the student-loan business, and do not get into nationalizing health care. greta: thank you. consider this. according to the government accountability office, some states are not using the stimulus money the way they were supposed to. joining us is steve moore, a senior economics writer for "the wall street journal." the whole purpose was to pay down debts. we have spent about 10%, a little less than 10%. >> you have been asking me this question for the last couple of weeks, and now i have the report from the general accounting

office, and you are not going to be too happy, and most taxpayers are not going to be too happy. it turns out that a lot of the money has gone for medicaid and to stabilize their budgets. you might say that giving money for medicaid and restabilizing budgets is a good thing, but it does not create jobs -- and for stabilizing budgets. infrastructure projects, investments we were told we're going to create jobs, only $1 out of every $13 is going to fix in potholes, building new roads, bridges, things like that -- going to fix in potholes -- fixing potholes. greta: what you're basically doing is making payroll. the problem is, two weeks from now, you have more payroll, and you have not generated more jobs

if so you can create your own peril. >> -- to create your own payroll. greta: the night that he said that, mike in box got flooded with teachers. -- my in box got flooded. >> a lot of states cannot tell us what they are doing with the money. it is almost like it has been lost in space, so there is no accountability. i think senator mitch mcconnell had it right. we would have been much better off if we had given it to the people, rather than giving it to the government's where we have no idea where it is going. greta: -- rather than giving it to the governments. greta: how in the world can you possibly figure out what u.s.

aid? that is where i think we are being a little bit bamboozled with the statistics -- figure out what you have saved? >> well, i think the main point is you can never really measure whose job has been saved year. certainly, some jobs have been saved, -- measure whose jobs have been saved youhere. we just have to look at the overall numbers, and the job numbers are terrible. these are the worst job numbers we have seen in 30 years. we have lost somewhere in the number of 3 million or 4 million jobs. we were told this was going to reverse the losses. look. i very much hope that the next couple of jobs' reports are good and that we are past the high point in job losses, but even the administration is saying they expect unemployment to go up maybe 10 percent or so, and that is a really lousy number.

that would be another million lost jobs. greta: talking about the people who have lost jobs and cannot get them, but we are not talking about people who have given up. in the inner cities, the unemployment rate is skyrocketing. >> yes, black teenage unemployment rate, 38%. 24% for all teenagers. they are going to raise the minimum wage. this is a terrible time to raise the minimum wage when teenagers cannot get a job. i think senator mcconnell is right. we should not be focusing on health care reform right now. we should not be doing cap and trade. we should be focusing on jobs. greta: a second stimulus. i think the american people ought to beg the members of congress this time to read it. if they are thinking about passing one in september, start talking now?

so that we can read it, and they can put it on the internet, as promised. >> already over 1000 pages. the stimulus bill, the budget, and the cap and trade bill, and congress did not read any of them. greta: that makes all of us crazy. steve, thank you. calling governor palin's a quitter. did they jump ship -- calling governor palin a quitter. and david letterman is talking about her again. we will play the tape. we report, you decide, and michael jackson's doctor answers this question -- are you the father of jackson's children? his answer? he will answer it for you. gecleaning system... that seeks and destroys engine gunk... left by lower-quality gasoline. it protects engines from performance-robbing gunk. try new nitrogen-enriched shell gasolines.

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does two jobs... at once. one: kills weeds to the root. two: forms a barrier, preventing new ones for up to four months. roundup extended control. [captioning made possible by fox news channel] captioned by the national captioning institute --www.ncicap.org-- greta: some are singing governor palin is a quitter.

we have new information tonight -- some are saying governor palin is a quitter. she still has strong support among republicans with a new poll. 72% of republicans are likely or somewhat likely to vote for the governor if she returns and runs for president, so what does the future hold for at sarah palin? rick santorum. did she hurt herself by quitting? >> she did. her biggest fans is my wife, karen, and she loves her -- her biggest fan is my wife. number two, it hurt women in politics. my wife is a very much a part of my career, and she is always trying to promote women in politics, and it looks like she could not take it, and that is not a good thing for women.

i am speaking for my wife, not me. i am not telling you how i feel about it. that is how she feels about it, and i think it will hurt her. use a 70%, but that is a question, would you vote for her for president against a democrat -- use a 70%. i do not think that is necessarily a strong no. 4 -- you say 70%, but that is a question, would you vote for her for president against a democrat? i do not think that is necessarily a strong no. for her. she does connected terrifically with audiences. she will do lots of television. she will be able to do what she cannot do when she is up in juneau, being isolated. i am sure that is what she was thinking. "i need to get out of this down and get out in the world, where i was before, where i can defend

myself, and not be brought down with having to govern a small state." i think that is what she was thinking. in the end, it may play well for her, but right now, she is taking a hit. greta: one person said that she was going down to campaign for him. >> she will be campaigning for people. it is going to be good for a financially to do it. she would get big speaking fees. -- good for her financially to do it. she will be able to do what is important. look, she is not a wealthy person. they are not a wealthy family. they have had all sorts of expenses that come with being a celebrity, and she did not have the pocketbook to back it up, so this is probably in part a financial reason to keep some stability in her family, so i do not blame her as much for making the decision. the best thing for alaska, and

this was all about alaska, it may have been something about alaska, but i think it was about doing what was best for her family, doing what was best for political career, but i just think she could have been more transparent when she said it. greta: was she hit harder than male candidates? harder than hillary? >> yes. there is nothing worse in the media than a woman conservative or an african-american conservative. if you are a woman conservative or an african-american conservative, you are going to get hammered and hammered hard, because you are not supposed to be a conservative. you are supposed to be something else, according to the mainstream media. clarence thomas, the uncle tom, if you will, so she will continue to be beat up, because she is very articulate, and she

is a very likable conservative women who believes what conservatives believe. greta: did she get hit more than secretary hilary clinton, or did they both get clobbered? >> when she was first lady, hillary clinton got clobbered with hillary care. she did not get clobbered during the campaign. she got clobbered for putting up with a bill. look. she was there, and she got clobbered because they did not think she could win, and she would have been the drag on the ticket. it had nothing to do with her being a woman. greta: i also think that the women were harder on sarah palin than the men. >> i am not so sure that i would agree with that. i would think that men and women were both very hard on again, she was so affected.

she lived in her own life -- where i was very hard on her. she was very effected -- i would think that men and women were both very hard on her. again, she was very affective. greta: personally gratuitous. >> they were certainly personally gratuitous. she will have to prove that she is up to the task of being president from a substance point of view. that is her big challenge. greta: a big thanks. thank you. up next, what did david letterman say about sarah palin? was this one funny? we will play you the tape. plus, north korea. there is a question about an attack and whether or not there are part of it. -- they are part of it.

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greta: does governor sarah palin blamed the media? was that part of for decision to resign -- blame the media? >> it is a bit perplexing,

because most candidates, most public officials, they look in the camera, and they say, "you had better leave your hands off of my kids." i have not been able to say that, and that double standard has been applied. that is a little frustrating. greta: david letterman could not resist making more jokes about the governor. >> oh, and how about this, ladies and gentlemen? governor sarah palin has announced that she is stepping down. she will no longer be the governor of alaska. she waved goodbye to russia. and people are puzzled by this. they say, "governor, sarah, what is going to happen?" and some believe that she will become the next octomom.

they say she is retiring because she is tired of the attacks from the media. "tired of the attacks from the media." thank god i did not say anything. greta: joining us this fox news contributor tucker carlson. well, tucker, what about this time? >> that did not work as well for him. this was pretty restrained. there is clearly, obviously, a double standard when it comes to sarah palin. they do not like kirk and the fact that she is against abortion and that she is evangelical -- they do not like her. all of that hurts her and draws negative coverage. i have to say that i think she has to change the story line fairly quickly on this. bowling not by sayingbowing out

-- bowing out by saying tahhat - i think fairly shortly, she is going to want to change it. greta: it is not that good for you if you have that bull's-eye on you that you quit. >> you can spin it. you can say, "i give up." >> you were so mean to me, i am out of your -- you can say, "i give-ups." you were so mean to me, i am out of here -- i give up. greta: how does she do that? she went fishing. we sit in our nice, warm

studios, and she goes fishing. >> good for her. greta: good for her. she needs to get down to the lower 48 and really start working below or 48. -- working in the lower 48 -- working the lower 48. >> i do not think this makes a ton of sense if she wants to be president. she could be the leader of the conservative movement, which, god knows, needs one. greta: it is really hard to get to alaska. i have followed up there. they are terrible flights. they are in the middle of the night. you are sleep deprived. every time she was gone, the people were complaining that she was not up there. bobby jindal can get away with going around the country down in louisiana not being criticized. >> it is hard to build a

national base when you're not even connected to the continental united states, as she is out there, but you can imagine a scenario where she becomes the marquee dinner speaker. ronald reagan spent years during this. as a union guy in california and then as an employee of ge, traveling around, giving speeches on behalf of conservative ideals, and after that, he had what was considered his conservative base. that fact is not lost in all of this. mostly because of the hostility of the press. >greta: speaking of the hostility of the press, every time they go after her, i think it just drives her supporters out in droves. >> there is a certain group of americans. it is not a majority. it is a certain percentage of that thinks the media is biased. on the other hand, -- it is a

certain percentage that thinks the media is biased. greta: it is a big difference between going after a candidate aggressively about policy -- >> right. greta: and challenging and scrutinizing. i do not think that is the treatment she got. i do not think that is the treatment hillary clinton got. i think they got special treatment. >> there was something going on in the press. there was something with your having five children, one of them with down's syndrome, the issue of abortion that infuriated lifestyle liberals. i am not one of them. greta: i will not tell you who, but someone said to me, "what. the reason why so many liberals hate her is because she is happy -- look."

>> they hate her family arrangement. i am not a shrink. i do not understand why. they hate that. greta: this is a woman who is a consummate feminists. in the 1960's, women wanted to have families and jobs and careers. she does have that, and people are mad at her. >> she has got the highest ratings in history, her speech, her talent, and yet, she does not qualify as a real woman because she is against abortion. greta: never dull though, never dull. tucker, good to see you, tucker. up next, north korea. plus, a reporter doing something very different. it involves a angry ex-husband. you will see that tape next. -- it involves an angry ex-

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greta: since early april, north korea has conducted an underground nuclear tests and has been firing missiles towards the united states, but it has been more than just s. they have also threatened an attack. -- more than just threats. there have been cyber attacks in the last week. an official tells fox news that the attacks are -- from north korea. joining us is rod, a cyber chief. >> this attacked is at botnet -- this attack is a botnet attack. tens of thousands of machines.

they started hitting the government websites with a lot of requests, a to 100,000 internet requests per second, overloading -- up to 100,000 internet requests per second. that helps you visualize the problem here. greta: is this a nuisance, an incredible nuisance, or is this truly destructive? it has harmed our national security? >> it is more in the graffiti school of cyber attacks, someone trying to paint nasty messages, break some windows. it is more of a political statement. to my knowledge, no data taken out and taken back some or else, just really annoying behavior and actions to send a message from the web response circuit. greta: -- actions to send a

message from whoever sent it. >> legitimate party is coming in from outside or having a hard time getting in. they're all of those false messages. u.s. national assets. so, yes, in korea, there may have been some of the same experiences. greta: why would the pentagon think that it is north korea? >> if they could find who wrote the check to get this started or who wrote the code and dropped it on a machine, then they can know for sure. if you look at the behavior over the last week, it is a pretty good guess that it may be coming from that direction. they may have done the digital forensic and found the digital fingerprints to track all the way back there, or they may have other sources of intelligence

that i am certainly not aware of, but, certainly, people are questioning north korea in this issue. greta: thinking that they're sitting around, jamming our computers, possibly doing something to our computers, but on the other hand, could this be a guy sitting somewhere in front of a keyboard who did this? >> you know, it actually could be. this type of attack is an old technology from 2004. we found fragments of code that the programmer created that has been spread around. it will start being blocked by anti-virus. it could have been done by a single individual who was motivated politically or someone who wrote a 10,000 dollar check or a $50,000 check or something else and he said, "go, get this done, and cover your tracks" -- or someone else who said that.

teenagers playing around, writing code, thinking if they can create a virus for fun, but here, targeting a number of business websites, u.s. government websites, it looks very well targeted, so it seems to have a political message behind it, a little bit like launching scud missiles towards the u.s. it is kind of annoying. greta: thank you. >> thank you, greta. greta: a man accused of taking his ex-wife hostage made a bizarre call to someone during the standoff, a local reporter peter the man is accused of kidnapping his ex-wife -- a local reporter. the man is accused of kidnapping his ex-wife, and he allegedly threatened to hurt her and blow up the house. he also called a local reporter. >> what made you call me? >> i trust you. >> you do trust me?

>> yes, and i think you are a good reporter. i think you mean well. >> we would like to pose something. richard? all right. ok.

i do not understand what you want a priest. they are not going to harm her. greta: after more than 12 hours with police surrounding the house, he released his ex-wife. about one hour later, gunshots were heard, and then he apparently muggy house on fire. he eventually surrendered -- he apparently let the house on fire. -- lit the house on fire. now, here is a look at what is going on after the show on "the

o'reilly factor." bill: al sharpton is offended. he will be here. greta: do not miss "the factor." id is explosive tonight. and california is issuing iou's -- it is explosive tonight. and a video that got lots of hit on youtube, and the number is climbing. this video is just for you if you have had a problem flying. want to squeeze more out of the things you buy?

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greta: there is much more "on the record" ahead, but first, we go to our new york newsroom where lauren green is standing by. >> steve mcnair was the victim of a murder-suicides. he was a married father of four -- the victim of a murder- suicide. kazemi shot him and then turned the gun on herself. the exiled president of honduras, zelaya, is insisting that the government needs to be removed. they are scheduling talks tomorrow in costa rica. there'll be a mediator. zelaya was ousted for trying to

extend his time in office. i am sorry green. now, back to "on the record." greta: how much is an iou worth when it comes from california? well, it may be worth $0. >> it is definitely getting more speedy states keeps suffering credit rating downgrades. -- it is definitely getting worse. the states keep suffering credit rating downgrades. greta: instead of tax refunds, they are getting iou's, right? , right?

>> yes. greta: , what do you do with -- greta: what do you do with the iou? >> you try to cash in with interest. greta: what what i try to log on to it until october? -- well, what what i try to hold onto it until october? >> a lot of the problem is a lot of people will not get their iou's until after a certain date. greta: the banks that are not taking them, are these banks that we have bailed out? >> yes, we're talking about bank of america. we are talking about chaves, wells fargo, all of the major banks. -- we are talking about chase. back in 1992, the last time a

state issued iou's, they felt they allowed the governor and the state just procrastinate. -- to just procrastinate. greta: what about the people in california, who, all of a sudden, have now realize they are going to get iou's? are they not up in arms, the people? >> yes. the thing about this is is kind of a perpetual problem. every summer, there is always a budget issue. vendors expect their payments from the state to come, and they cannot get them, and they have to take out lines of credit. some people of almost become numb to it -- have almost become numb to it. i do not think anyone is going

to come out looking good. the legislature has an approval rating of like 13 percent now. the governor is down to 33%. he used to be a lot more popular, and is only going to get worse. -- and it is only going to get worse. greta: everyone is fighting to get that job. go figure. thank you. up next, is michael jackson's dermatologists the father of his children? what is is dermatologists say to that -- is michael jackson's dermatologist the father of his children? what is his dermatologist saying do that? -- to that? the difference is ford quality.

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greta: all right, you have seen our top stories, but here is the best of the rest. never dull. there have been stories that michael jackson's dermatologist is the father of his trial. his answer? see if you can figure it out. >> do you know where the biological father is? >> all i can say is that to the

best of my knowledge, i am not the father. if push comes to shove -- to the best of my knowledge, i am not the father of these children. i cannot answer it in any other way, because you know what? i do not want to feed any of this insanity that is going around. greta: "the best of my knowledge." and we understand that betty wrote is not uncertain -- debbie rowe is not uncertain. and the right hand of ex- governor blagojevich. why is this a problem? he has agreed to testify against blagojevich. he pled guilty to wire fraud. he talked about appointing someone to senator obama's open

senate seat in exchange for money. he apparently had his sentence knocked down as part of the plea deal. and you would not believe this was possible unless you saw it on tape. >> it shatters off the dugout. wow. that is 9 strikeouts now. it is flying. greta: he was from the kansas city royals. somebody should give that cell phone got a contract. and there you have it. -- that cell phone guy a contract. and 100,000 people on youtube cannot be wrong. if you hate the airlines that fly you, this is for you. taking its rightful place

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flash the studio lights. one man said united airlines snatched his guitar, and then the airlines refused to pay for the damage -- smashed his guitar. >> ♪ unitas', you broke my favorite guitar -- united united, some big help you are you are liable just admit it i should have gone by car because united breaks guitars ♪ greta: