joph hirko used to run enron's broaand division. day, he was sentenced in hoton to 16 months in jail. he also agreed to y $8.7 million inestitution. prosecutors say rko promoted enron's broadband vision to analys, while knowing the system couldn'do what was being promised. susie: here's a look at what's hpening tomorrow. the s&p caseshiller home price index for july, iseleased. also tomorrow, quarterly rests from darden restauras, nike and walgreen. >> paul: recping today's maet action, day of deals brings buyers off the delines. to learn re about the stori intonight's broadcast or wah our streamg video and to take partn our dai blog to "nigly business report" on pbs.org, you can email us at r@pbs.org. >> sie: a new assignnt -- captain suy you'll recall that sullys the pilot who neuvered u.s. aiays flight 1549 to a picture-perfect landing onhe frigidaters of the hudson back in january. everyone on board surved. toy the airline announced that sully is returning to works what's kno as a management pilot. that means hll be back in the

josephirko used to run enron's broadbandivision. toda he was sentenced in houstoto 16 months in jail. he also agreed to pay .7 million in restution. prosecutors say hirkpromoted enron's broadband divion to analysts, ile knowing the system couldn't dohat was being promised. >> sie: here's a look at what's happeng tomorrow. the s&p case, shler home price index for july, is relsed. al tomorrow, quarterly results from darden restaurants,ike and walgreen. >> paul: recapping today's marketaction, a d of deals brings buyers off the sidenes. to learn more about the stories in onight's broadcast or tch our streing video and to take pa in our dly blogo to "nhtly business report" on pbs.org, you ca email us a nbr@pbs.org. >>usie: a new assiment -- captain lly you'll recall that sul is the pilot whmaneuvered u.s. rways flight 1549 to a picture-perfect landing the frig waters of the hudson back in january. everyone on board suived. day the airline announced th sully is returning to wo as what's kwn as a management pilot. that meanse'll be back i

joseph hirko used to run enron's broadband division. today, he was sentenced in houston to 16 months in jail. he also agreed to pay $8.7 million in restitution. prosecutors say hirko promoted enron's broadband division to analysts, while knowing the system couldn't do what was being promised. >> susie: here's a look at what's happening tomorrow. the s&p case, shiller home price index for july, is released. also tomorrow, quarterly results from darden restaurants, nike and walgreen. >> paul: recapping today's market action, a day of deals brings buyers off the sidelines. to learn more about the stories in tonight's broadcast or watch our streaming video and to take part in our daily blog go to "nightly business report" on pbs.org, you can email us at nbr@pbs.org. >> susie: a new assignment -- captain sully you'll recall that sully is the pilot who maneuvered u.s. airways flight 1549 to a picture-perfect landing on the frigid waters of the hudson back in january. everyone on board survived. today the airline announced that sully is return

it would have been a lot better if we had enron help us, huh? still, no audit. they have selected an investigator, but no audit. why didn't the acorn advisory board ask to help acorn get to the bottom of things, select an auditor? well oh, let's look. let's look at who the advisory council is. this is fantastic. first of all, there's a kennedy, yeah. kathleen kennedy townsend. she is the eldest child of r.f. k, the former lieutenant governor of maryland. she sounds great so far. glenn beck, why would you take her down? oh, i'm not. i'm just pointing it out. she serves on the board for the radical center for progress. wait a minute. isn't that george soros' group? yeah! with john podesta at the head. i remember that. we should come back. there townsend is also the founder of a swell group in maryland, the student service alliance. that was created to make maryland the first and only state that forces high school students to do community service as a condition to graduate. doesn't that sound great? i wish we could do that in the whole country. oh, i bet we will so

not every company with an accounting scandal is an enron waiting to happen.ugh i'll note if you'd sold enron when the first news of their accounting scandal broke you could have made it out of the stock with some of your money intact rather than with nothing. the irs accounting irregularities broke at around 40. the last ones broke at 0. when you see accounting irregularities, i'm going to say it again, you have to sell. sometimes you'll be wrong, but far more often you'll be right. i know far more people feel that rule kept me out of making x or y. no, that's the wrong way to look at it. that rules prevents from you having a black hole in your portfolio. and no, an options backdating problem is not an accounting problem. it's a compensation problem. let's understand an accounting problem means the numbers are phony. but companies that backdate options for the officers don't do it because business bad, like companies that lie about their financials. they do it because business is good and getting better. those executives would rather take stock than cash beca

gwen: a still-strugglin comply, and a slippery political enronment -- all signal a tough aumn ahead. joining us tonight for our labor dayreview, dan balz of the "wasngton post," jkie calmes of "the neyork times,"ohn dickerson "slate" magazine d cbs news, and martha raatz of abc news. >> cebrate 40 years of jonalistic excellencefrom our nation's capal, this is "washington ek" -- "washingt week with gwen ifill & natiol journal." corporate funding for "washington week" rovided by -- >> we know why we're he. to desig the future of flight, inside and out. >>o build tomorrow's technology inmazing ways. >> and reshape the science of aerospac forever. >> around the globe, theeople of boeing are working together for the dreams of generations to come. >> that's why we're here. >> maj funding for "washgton week" is alsrovided by the annenber foundation, the corporation for public broaasting and by contributions to your p station from viewe like you. thank u. once again from washington, moderator gwenn ifill. gwen: good evenin well, mr. presidentno onever said the job was goingo be easy, and now

bill, remember that one that passed in the wake of the scandals, the accounting scandals we had with enron. that was supposed to be the end of scandals and then we had another one. so i'm not entirely convince that had more regulation is the solution. host: gregory on the independent line. caller: well, you know, first tonight say to them, i generally support our president. but i do have concerns about the cap and trade legislation for congress. it's my understanding that that's going to cost like each taxpayer, american taxpayer like $1,700. so i would like to see that our government goes a lot slower on that. also, on the health care issue, i think that going and making health care available to every american is going to make this country more competitive in the end. my understanding of economics is that through the circle of spending and expenditure, we will get an expansion in the general economy. host: why don't you take the cap and trade part of that, the climate change legislation. as you said up in new york, we're reading about the largest pending meeting ever on this topic in new

turns out to be one of theost diverse enronments on eart then we sad slave cabins and central high schoolttl rock, arkansas. stila working inner city high school today. a unit the national park system. manzanar where japane american citins were terned during the second wor war shamefully. we've saved martinuther king's boyhood me in atlanta. we have the atue of liberty and mount rushmore but we ve been a big enoh country to inle complex geographical history but also a compl cultural and htoric and now etographic past that says you know, we're a complicated country d by understandinall of that we so shanksvil, pennsylvaa, where united 1993 went down is the site of a national park city. so is oklahoma city, theite of the greate domestic terrorist events. its a great system. i'll argue on that great idea. tavi so you have. the timing could not have en more proficiou i want to know how much u paid barack obama to to two parks this summer with his ks? i bumped into him before he went. he said 're going to the national par and i said i heard and we are so ve pleased and he had melia and sasha l

>> the headquarters of the b and o railroad which was enron of the day.ust no expences spared in building it. everyone should stop in. >> you know when is a perfect evening, looking at the marble, having a glass of wine, ordering dinner. >> a great date. >> then watch the ravens. >> chef michael reed. all this information on our web >>> five-day forecast including the ravens forecast 85 through tuesday and friday looking at temperatures up to around 77 degrees, chiefs and ravens kick off. >> the annual pig town festival in baltimore city. >> the day was a joy, you can see, the piggies ran races giving plenty of laugh. >> in a twist, pulled pork sandwiches served. >> oh, come on, that's not right. >> you have a great happy hour. >> from 4-6 every day and dinner from 5-10. >> thank you for joining us. go ravens. >> x

enron and all those people, arthur andersen had the accounting responsibility. they told them where to put it billions. two weeks later the largest accounting firm in the u.s. this appeared. if you look at the problems in healthcare is the tax system. they have been talking about it for 40 years to simplify its. it is up to 67,000 pages. both sides will not talk about it. guest: merrill, i run an agency that is a regulatory one. i don't know if bill wants to answer your tax question, but i leave that to my colleagues over at the treasury department and white house. i would mostly focus on reforming the financial system which i think we must do. if we do not, then more taxpayer money will go out. you and i both put money into aig. i think the most important thing we can do now to protect taxpayers is to reform our financial oversight. host: what you think the legacy will be of september 2008? guest: i hope is that we make reforms and protect consumers better, but certainly there will be steady for decades about what happened. -- there will be studies for decades.

bill, remember that one that passed in the wake of the scandals, the accounting scandals we had with enron. that was supposed to be the end of scandals and then we had another one. so i'm not entirely convince that had more regulation is the solution. host: gregory on the independent line. caller: well, you know, first tonight say to them, i generally support our president. but i do have concerns about the cap and trade legislation for congress. it's my understanding that that's going to cost like each taxpayer, american taxpayer like $1,700. so i would like to see that our government goes a lot slower on that. also, on the health care issue, i think that going and making health care available to every american is going to make this country more competitive in the end. my understanding of economics is that through the circle of spending and expenditure, we will get an expansion in the general economy. host: why don't you take the cap and trade part of that, the climate change legislation. as you said up in new york, we're reading about the largest pending meeting ever on this topic in new

greta: -- make enron look like a lemonade stand. greta: how does this happen? >> it is completely a rages, and it literally is 1000 times worse than you could imagine. -- is completely outrageous. greta: give me another example. >> there is a person who bought a medical supply company. he defrauded medicare instantly and committed another murder and dismembered the guy, was found guilty for medicare fraud, and he is now on trial for committing a second murder. greta: so what do we do? at least the president's program, at least if we can figure out this fraud, if we can recapture it that in many ways it could pay down this health- care bill, what do you suggest? >> i give the president of a lot of credit for raising the issue last week, because he is right. the amounts of money are very staggering, but he would have to insult a lot of people. you know those scooter commercials? those are right for fraud. it is impossible to fix people that run medicare, so what they should do is authenticate -- outsource the authentication. the culture is completely corrupt. the

in the interim period, james, as you well know, we had the tech bubble, all the enron scandals. we had the horrific housing bubble and the commodity bubble and the energy bubble and the subsequent financial meltdown. but you go back, for some reason, we haven't moved since that fateful day. and i just want to ask you, is there a new trend? a worse trend for the american economy? stocks are uncanny in their forecasting ability, jim. >> right, but not too long ago, the dow was at 14,000 and that wasn't a very good prediction about what was about to happen next. so stocks are not completely accurate about everything all the time. i'm just saying that to me, it's not a good idea to bet against the american economy. but i can tell you this. i think american primacy, both in economics and militarily is something that we cannot take for granted over the next decade. and it's true that there may be some jitters about that, and it's possible that it started with 9/11, although i don't think so. >> we're going to have to take a quick break. jim glassman has some other plans. american mili

national security advisor position for a close confidante named henry kissinger, who ended up doing an enron around another person at the time, and the rationale was that he needed his own foreign policy confidants, i guess, and we all know what happened, in retrospect -- his own foreign policy, cannot -- confidante. >> basically, what you are saying, some people say the government spends money. yes, the government spends a lot of money, but obama is making all of it look like child's play. it did not make it right then, but we do not even know the number for certain, because the white house will not admit how many czars they have appointed. look. this gets back to basic constitutional functions of congress and the executive branch, accountability, and transparency, openness, very basic functions, and if you have people who are unconfirmed, unvetted, i mean, look at the van jones episode, who was not vetted by the white house. they are not open to any hearing to what previous administrations have adhered to -- they are not open to adhering to a previous administrations have done. neil: congr

i think it's also important to keep in mind, it's not the regulators that found enron or found lots of other scandals. it's the short sellers. you need to be able to encourage speculation as a way of price discovery, a way of finding information. the thing that bothers me most of all is it's just a distraction. it does nothing to reduce the leverage in our financial system. it does nothing to reduce maturity mismatch. once again i point back to the housing market. we have all sorts of taxes, transfer toxs in the housing market, yet we still had a housing bubble. my preference would be our so-called leaders focus their attention on fixing the things that got us into this financial crisis rather than just trying to distract the public anger away from themselves. >> david, let me help you out here just because i know the side our viewers are on, mark. we already tax -- pay for our regulators by a small tax on transactions in this country, small but we do it. if you're taxing 5 cents on every $1,000 transaction, is that going to kill anybody? >> are you asking me? >> i'm helping you out. >

they bought out of enron bankruptcy a company for $300 million, and it will generate $6 billion in sales, and $1 billion in operating profit. get your hands on some general electric. that's what i say. >> of course, general electric is our parent company, those of you who haven't been sitting behind a rock. 2% this week. and yet there's a lot of hand wringing about it. 2% is the normal correction that we have seen in the last six or seven months. we've seen eight or nine of them. >> let's not forget not that long ago we were moving 2% for weeks at a time. we've seen a string of less good economic data. the economic data is improving, but it's not improving as much as expectations had hoped. i think to a large degree that's weighing a little on the psychology of the market here. at the same time we are 55, 60% off the lows in many stock indices. i think in materials of where investor psychology is right now, you're hearing a lot more about people interested in taking a little bit of money off the table. perhaps at any point over the last couple of months that the rally's been going on. >>

are saying, loo, we need to create tsituation as we did in iraq where aurge creates the political enronment that there can be some sort of reconciliation. but'll tell you, charlie, what's going on righ now with the election, with psident karzai and questionsf the letimacy of that past election, that's not giving anybody any reason to be confident that this political renciliation is gog to come any time soon. >> re: jake, we'll come to that at anher time. thank u so much. as we begin our ll program, it's nice to have you here. >>hanks, charlie, hope to see you soon. >> rose: we'll be right back. stay with us. >> rose: president obamaill adess a joint sessionf congress and the coury tomorrow night in an attempt to revive suppo for health care reform. after weeks ofrowing opposition to democratic proposals in congress the president is expected to ouine his own plan and try to regain mentum for his top domestic prioty. the spee, some say will be a ketest to his presidency. joining me now from washingn to preview wt faceshe president is john podesta, he's served as chf of staff to esident clinto

we don't want to go down the road to the last problem we had in accounting at enron and overregulate and push companies offshore and end up limiting our business to be an entrepreneurial state. our key to financial success and competitiveness and economic activity in this country is have a robust credit system one where credit is easily and readily available and you don't want to put a big chill on that by throwing a massive blanket over it. >> thank you for your time. >> thank you. >>> latest on the surprising arrest over the week jeked of director roman polanski. his attorney says the 76-year-old will fight extradition to the u.s. to face sentencing for the 1977 sex crime involving a 13-year-old girl. nbc's donna friesen is in zurich, switzerland, where polanski was arrested and is behind bars. why this move now? he has a home there and taken many vacations, skiing in switzerland. why the arrest at this time? >> yeah. that's not an easy question to answer. the fact is roman polanski hasn't been in hiding the last 30 years. he has been public and making films and received an oscar f

president might be able to use this big speech to get republicans on that side and republicans supporting enron-likees? >> there is always a concern when barack obama gives a speech. he does it very effectively. one of the things the white house does is whenever there is a problem they put barack obama out there to give a speech because they know how good he is. you hit the nail on the head in the intro, david. when you said that the white house said it will be clear what barack obama's position is. that means that they haven't been clear. you look at what david axelrod said yesterday. it may be and it may be out. there really seem to be playing the hokey public here. take the public option in and take the public option out. we will find out on wednesday what it is but it's still a question. >> strategically for the republicans, they ought to stay out of this? you've made your position clear and you don't like what the white house and democrats are doing and really the democrats could do this conceivably without republicans if they can get their side of the aisle together? >> absolutely. democrats h

enron and all those people, arthur andersen had the accounting responsibility.they told them where to put it billions. two weeks later the largest accounting firm in the u.s. this appeared. if you look at the problems in healthcare is the tax system. they have been talking about it for 40 years to simplify its. it is up to 67,000 pages. both sides will not talk about it. guest: merrill, i run an agency that is a regulatory one. i don't know if bill wants to answer your tax question, but i leave that to my colleagues over at the treasury department and white house. i would mostly focus on reforming the financial system which i think we must do. if we do not, then more taxpayer money will go out. you and i both put money into aig. i think the most important thing we can do now to protect taxpayers is to reform our financial oversight. host: what you think the legacy will be of september 2008? guest: i hope is that we make reforms and protect consumers better, but certainly there will be steady for decades about what happened. -- there will be studies for decades.

you've been in the enron movie. are you going to be in this movie, yes or no?d. >> you just might be? >> i've been asked for advice. >> you're comfortable wearing makeup. >> i wear makeup almost all the time. >> because in the first wall street, all those guys that -- remember making the speech, buddy fox walks into that office, a lot of guys were actual lehman guys and wall streeters that got little cameos from oliver stone. >> i have a face for radio. >> you were good in enron. >> joe will be with us the rest of the show. we'll talk about health care and a lot of other things out there as well. shares of a small biocompany that will soar on significant weight loss seen in two big studies, 37-pound average weight loss. i don't want to lose 37, i don't think, mike. >> 37 pounds, a lot of people who do, probably million that is do want to lose that much. you were just talking about drug innovation. they're taking two old drugs and making a new one. i'll have the details coming up when squawk box continues. >>> on this day in 1883, what first lady gave birth to a

supreme court will consider an appeal of enron jeff skilling.n grounds the legal theory underlying the case was flawed and the jury was prejudice. penske auto group will close its deal to acquire saturn. the deal was first announced back in june. again, see what we're set to do with trading. joining us from mf global, cme group, todd, looking at futures under a little pressure after yesterday's gains. today we have big numbers, case shillinging at 9:00 a.m., consumer confidence at 10:00. >> they will watch. both will be market friendly. we expect home prices to decline at a lower rate and krfd to increase. confidence mirrors the shape of the stock market over the last six to eight month. we've seen confidence above that 50 mark, which is obviously a sign of optimism. i think today will play with that. however i think the big number is friday with the jobs report. that will obviously be what dictates the trade over the next few weeks. >> earlier this morning we had one economist mark visitner looking for a number of about down $200,000. how is th

in the middle box, the former chief executive for enron's technology division ordered to pay $7 millionf restitution. prosecutors say he falsely promoted the broadband division to analysts to inflate the stock price. in the bottom box, they are more than 100 and there are more than 140 people dead after tropical storms late philippines under water. 30 people are still missing and there are dozens of unconfirmed deaths. now there are fears that a new round of storms could flood the region even more. trace: it seems unlikely president obama will meet his own deadline to shut down guantanamo bay by january. the white house now admitting the process is more complicated than they thought. in the meantime, concerns about what is happening in get no, but reporters are finding it more difficult to get the answers they need. catherine herridge, why is it getting more difficult for reporters to cover this story? >> used to be able to make side trips to the camp when there was court in session. now there is a decision coming from the defense department that has stopped allowing these sorts of trip

he's one of the big guys to figure out baldwin united when he was in his early 20s and enron much later. he's in demand by rollywood types to consult on the new wall street. i mean, this guy is the real deal. it would be great to talk to him as president obama gets ready to talk about health care and to address a joint session of congress. we've also got a former fda commissioner who knows all about our issues. then we've got inside the scam of the century, again, a new video of bernie madoff's new york city penthouse and his digs in west palm beach, florida, all up for sales. we're going to take you inside. also, business in and out of the pool with the one and only michael phelps. 14 olympic gold medals. he's going to be here on the set with us. he could give us -- >> remember when he came on the set before? >> yeah, yeah, it do. it was early for him and his pants were falling off. got that look. could there be one squawk gold medal that he could give us? >> you mean just hand over one? he's got 14. >> he's got 14. also, we have elizabeth warren. it's been wrapped from london before,

we go back to the pan american airlines, world com, enron, stocks that were prestigious, there is a disbelief that the companies won't exist anymore. when they do come out bankruptcy using the same name it's actually a new company. >> julie: you buy the stock, you make gains, you think you are doing well and finally bankruptcy clears, then what happens? >> eventually the stock gets de-listed there is no trading. there is a gap between when the company itself on paper is completely worthless. creditors and bond holders get paid first. if there is anything left over it would go to shareholders. so that process takes some time. in the meantime, those stocks don't get traded on major exchanges. there is some activity. people buy into the name. >> julie: all right, thank you very much. >> gregg: we're going to surprise you, little known fact about our universe, have you wondered what it feels like to see and feel and smell, that is right, smell fate. coming up, two nasa explorers are going to be joining us. the experiences of being up there in orbit. ♪ ♪ ún@@ >> gregg: exploration of space over th

enron, we all thought the ratings agency will change they way they do business.. and this comes along and we say, again, the rating agency has got to change the way they do business. tell us why this time it's going to happen? >> because we're going to legislate. one thing we do is we mutt the pusle of the government behind the rating agencies. you can't sell or buy certain things if they don't have a rating. we're going to leave it to the market. i think people have become too re reliant on the government. there are a lot of things we were working on to try and encourage that. bipartisan agreement on this, we have exalted the rating agencies too much and put in people's minds that they can put too much confidence in it. i hope to repeal all the statutes that mandates the use of rating agencies. >> one final question on the tax front. big issue. maybe we can put the day off of deelg with it a little bit. last week you said one way would be to cut spending a little bit. do you think there is a way to really avoid a broad-based tax increase in america over the next

fundamentally unhealthy for whales and for salmoand all the thgs that make it a rich, wonderful enronmente nt couple of decades, when i'm years old, if we don't do anying, people will s, "you... your generation, you lostt. you weren't willing to step and save i" >> smith: back on e east coast,ear chesapeake bay, the problems of velopment sprawl th king county is fighting ha played out in the suburbs of washington,c. already 17illion people live in the chesapee bay watershed. in recent year 10,000 more moved in everyonth. and evermonth, 3,000 acres of forest were lost to developmt. >> virginia, the outer loop headg toward tyson's corner, reporting very heavy traic westbound... >>mith: the sprawl took off decades agout here in northern rginia, about five miles sou ofhe potomac river in a suburb ofashington caed tyson's corner. today, tyson's is a casetudy in t harmful impact of checked growth. but 60 yea ago, tyson's was just a rural crossads with a country store. >> as world r ii ended, it was a land of dairfarms and truck fas and abandoned farms, and relative little development. and it wa

they're bright kids and they're survivors in a very difficult enronment sometis.ssure on us to me them ahead. get them to pass the test and there are tricks of the trade that we use to get them to pass theest but we know in our hearts that they aren't really getting that lovehat learning and it's oy going to come wn we can slo down, we can identify them properly, assess them properly and have the time we need in middle school, i'm emphasizing because if we don't it in middle school and this is my point, we're going to lose them and we're going to contribute to the overwhelming dropout rate. e achievement rate between latino and african-american kids is a national disgrace. i'm a big fan of yours, mr. kozol, i just -- i want to emphasize there are things we can do right now to stop this. and with the situation it is now, all the things you're saying about busing and equality of opportunity, education wise is right. liberals have abdicated their responsibility. i totally agree with everything you said politically but we are in the trenes. we teachers, i don't mean j

. >> let's go back 22 years, what has happened. '98, '99, 2001 enron, and 2004, fannie and freddie. rapid rate? >> well, i had no idea that i was going to be for 10 or 11 years writing about nonstop scandals. it's about very large pools of capital that are free to trade wherever they can make the biggest return. >> '98 was the asian crisis. they move around the globe. but they are centered on wall street, right? >> well, wall street, it's the conduit. everything flows through here. now that we are picking up the pieces after the debacle in the credit market. wall street is the center of where people are angriest, and americans are enraged about why they are picking up the tab for what these people designed and devised. >> do you have a question? >> yeah, i wonder about when you think that they -- the deregulation -- >> is that a no, joe klein? you don't have a question, do you? >> yes, i do. regulations freed up the economy. but at a certain point across the line and it permitted these kinds of scandals to start happening, and was that line? where should we have stopped deregulating

that's what we said about enron, we have to do something about horrible mismanagement and we did. sarbanes oxley turns out to be an overreaction where we went too far. you're seeing listings on new york stock exchange decline, listing in london and elsewhere, because of the burden, reporting requirements placed on companies in the united states. that's not to mention the tax break. we had the second highest tax break in the globe. that's one of the reasons. when you talk about our economy, the word that hasn't been used by the president or very often in dialogue is jobs. that's what it comes down to. we need more jobs. when you're forcing businesses that build a new plato because of the comes disparity and tax disparity, it means our economy is not going to create the jobs we need to get out of this recession. i think we need some fairly dramatic change in fiscal policies so we don't have these massive deficits, largest in history, so we can do something to stimulate business and create jobs. this is not just a jobless recovery. to the extent it's a recovery we are continuing to l

. >> that would be 1987, we had a meltdown. '98, '99, 2001, enron, and 2002 worldcom, and then 2004 fannie our lessons. do we have another 20 years of these kinds of booms and busts? >> hopefully, joe there is financial regulation sitting before congress. the president proposed financial regulation to stop this. as time goes on, you know, the public's attention span is fairly short. it looks like superficially we are getting out of the recession. we are not. but superficially, at least on wall street it looks like profits are back. and everybody is caught up in health care now. there is not much attention and political capital and political will left to do the regulations that need to get done. that's really what worries me. >> pat buchanan? >> i happen to agree with him on this. the banks are still carrying the subprime mortgages inside their colon, if you will. >> i don't understand what that means? >> it's like a big tumor. >> pat is using a complicated financial term. it's a financial term that i use all the time. it's inside your colon. yeah. >> we went in and rescued the banks, and m

we have it with enron.e have it with the communications company, i can't think of the name right now. >> guest: worldcom. >> caller: yep, yep. you can look straight down the line and you can see all of of these people that made gazillions of dollars and they are not being lookeded at to see whether they obeyed the law in order to make those profits. >> host: which is one conclusion from the inspector general. >> caller: that is right. i wish i could disagree, but she is right. the question is whether more regulation is required or not. sometimes i'm on the fence about it. i think more regulation can hurt the small advisor and i think if the rule his been enforced and in fact the s.e.c. had done its job in the first place nfact, in this report, the inspector general says the s.e.c. could have caught madoff in 1992. i thinklet rules were in place, they weren't being followed. >> host: our guest is erin arvedlund, the book is called "too good to be true: the rise and fall of bernie madoff." in your first piece

you were there for enron. >> sanford. >> my home away from home. >> i'll find a way. >> something willhrough. >> they are trying to pay back their t.a.r.p. money, too. do you think that can happen if they can't resolve what's going on in the house? >> it seems like they are trying to do that as maybe a way to get some heat off after all of this. they just reached a deal with treasury to basically buy back a guarantee in the merrill lynch lawsuits, $425 million, want to pay back the t.a.r.p. money. maybe that will take some of the pressure off. the thing you kind of get when you talk to folks at b of a, look, this deal has worked out okay. stock is way up since the deal closed at the first of the year. >> you're welcome. >> for saving the nation. >> taxpayers are making money. >> all right. thanks, scott. i want to get back to john podesta now, our guest host, former white house chief of staff under president clinton, also president and ceo of center for american progress, i want to talk about this what president clinton said about how to handle this. >> health care. >> about how to han

sheets, overcompensating its officers and hiding that appeared in 2004 -- 2002 we had the collapse of enron. it should have. it was a ponzi scheme. it went out of business immediately. 17,000 people lost their jobs. but the bleeding stopped. it went out of business. the bad practices ended. in 2004 we caught the fannie mae cooking the books. what did we do? there were a few people who were let go but otherwise fannie mae, which had taken over 70% of the mortgage market, was allowed to continue. in fact, congress pump more money into fannie mae and freddie mac. this was adding gasoline to the fire. we should have stepped back and said, why are we having these incredibly large quasi- government bodies that operate like private companies that have an implicit guarantee from the taxpayers. we made the situation worse. fannie mae and freddie mac continued to put out home loans that they should not have done and we ended up with a house a bubble that finally collapsed and help -- to the meltdown. we had the lessons in front of us and we chose to ignore them in 2004 and in 2005. everyone did. host

what about enron? what about worldcom? what about bear stearns? private industry makes a lot of mistakes as well. the government does good things, though. think about this. if you or me should have the misfortune of of needing emergency medical care, an e.m.s. truck will come up here and hopefully save us. who is that? that's the government. if you call up because your house is burning, who are you calling? the government yet again. if you when you start slicing into that steak you might eat tonight, who is making sure that meat is safe for you to eat? a government inspector. public schools have made education opportunity for every kid in america. are some of them bad in need of repair and need to be better? of course they do. anything human beings do is going to need more work. but you can't say that public schools in general are a failure. can you say that public school needs to be improved. we need to get out of this thing where the government is -- we say the government can't function and can't produce good results for us. they do every day. y

bill, remember that one that passed in the wake of the scandals, the accounting scandals we had with enron that was supposed to be the end of scandals and then we had another one. so i'm not entirely convince that had more regulation is the solution. host: gregory on the independent line. caller: well, you know, first tonight say to them, i generally support our president. but i do have concerns about the cap and trade legislation for congress. it's my understanding that that's going to cost like each taxpayer, american taxpayer like $1,700. so i would like to see that our government goes a lot slower on that. also, on the health care issue, i think that going and making health care available to every american is going to make this country more competitive in the end. my understanding of economics is that through the circle of spending and expenditure, we will get an expansion in the general economy. host: why don't you take the cap and trade part of that, the climate change legislation. as you said up in new york, we're reading about the largest pending meeting ever on this topic in new y