♪ showdown at the d.c. corral. president obama sumthens big bankers to the white house and 12 months of tensions over bailouts reaches a boiling point. hot air and cold, hard cash in copenhagen. climate change a source of fierce debate and we're following the special interests and their money. and the president vows to put americans back to work and save small business at the same time. is this time any different? time to punchiniumium star iuii right now. a showdown brewing in washington. president obama is summering ceos to the top banks in washington. the message will be clear. your country needs you to lend, lend, lend. risky lending got us into this mess in the first place. easy to predict the headlines. wall street's greed versus main street's pain. what is hard to understand is what president obama can really hope to get from the nation's top banks that will really spur a recovery. that's why we turn to former chief economist at the imf as well as cnn senior political analyst david gergen. has the president reached a boiling point with the nation's big bankers? >> he's clearly very frustrated. he had the bankers in back in april and he told them, give on the populous uprising around the country, i'm the only thing that stands between you and the pitch forks. chilling words and he hardly served them with a lot of food. they got glasses of water. this time, i'm told, they're lucky if they get water. there is a sense in washington that banks have really gotten themselves crosswires with the american public and that they rolled up these big profits and goldman sachs, i must say to its credit, has turned it into stock instead of cash. a wise move on their part. even so, there is a strong feeling in washington that the banks have recovered but main street hasn't and the banks aren't doing enough to lend, especially small business. i think the bankers themselves think there is a good chance they're going to come in for a scolding that may be a severe one. >> you mentioned goldman sachs saying their top 30 executives would receive a stock bonus, not a cash bonus and ken, that's interesting because a lot of people with goldman sachs that will make an awful lot of money, that's just 30. tresh redepartment also coming down with new rules and capping salaries at six companies and exceptional u.s. assistance to $500,000 unless there is special circumstances. what can the president do on monday? what can he do to tell these bankers to make them lend? >> the first thing i'll say, they'll need a stiff drink, not just water after he's done with them. he is mad. they are making money and they get loans and they have access to credit, but small businesses and medium-sized businesses don't. and it's a very awkward situation. the trouble is is on the one hand the president controls everything and congress there's financial regulation coming. can change the landscape of how banks work for two decades. he controls it. they don't know what it is going to be, but on the other hand, if he's not willing and we're not willing to get in there and micromanage them and tell them you loan to them like china and india, what can he do? they all have their own distinct interests and they all want to make money and he'll get mad, they'll do something but i think it's very limited what he really can force them to do. >> i wanted to ask ken, is there some danger here that washington could go too far in overregulating and overinterfering and overmanaging this and you could really dry it up in ways over time that would be dangerous for the economy, too? >> well, i don't think, david, there is any question they could go too far. i don't think we're in any danger of hitting that zone yet of going too far and they're probably being coshes and they don't want to cut back lending and hurt the recovery. of course, very hard to fine tune this. that's why nobody knows what is going to come out of this. >> let me ask you, ken, about the paycuts and the like. you mention to me what you think is happening in the uk and in france now, potentially, these taxes on banker's bonuses and that may be a way to go. you like that move. >> i am very sympathetic to that. just a one-time tax on this year, they got the giant bailout and they'd be out of jobs and they'd be broke. immediate takeback and i'm very sympathetic but it doesn't seem like it will happen in the states. >> so many moving parts here, david, outraged about the pay part of things. just how much money these bankers are getting so quickly after it took taxpayer money to stabilize this system and the president also has to get this lending thing fixed. the banks will say, look, risky lending got us here in the first place. we're not going to throw good money after bad. we're in the mix of good money in the economy. we're not going to get too aggressi aggressive. how can the president push to get what he needs? >> i disagree with my friend ken on the bonuses. i think if the government starts engaging in confiscatory kind of moves, that is going to have a very disruptive effect over time. and i know it's one time, it's a one off kind of deal and it's a 50% tax on bonuses, surtax and both france and the uk that are being, that are on the table now. but there is talk in whether this would work or not but talk about taking some of the t.a.r.p. money and making it available to banks as long as they lend it to small businesses, they wouldn't come under this regulatory structure and wouldn't have the stigma of t.a.r.p. attached to it and stimulate and especially lending to small business. whether that would work or not, i'm not qualified to say. >> we'll talk about that right after the break. david and ken, stick with us. confiscatory, that's a word, that's a good word of the day. we're going to keep that one. don't go away. check out this map, it shows a very important trend, a trend we'll want to pay pretty close attention to no matter where you live. we'll explain. an amazing illustration of the jobs situation we face in this country. take a look at this. it's a map created by la toya as part of a grad school project at american university. it shows the progression of rising unemployment across the country as we move from january 2007 to october of this year. those darker areas are the higher areas of unemployment. you can see it spreading like a stain across the country. besides being a graduate student, la toya is with the machinist union. welcome to the program. the illustration is beautiful in a very ugly way for many, many american workers. what story emerged as you started to put all of this county-by-county data together? >> i think the story is, just what you see. that there's obviously a jobs crisis going on right now in this country, and the premise behind the map and the reason why i put it together is because i wanted people to see what was actually going on. i think it's one thing for people to hear the numbers or read the numbers, and they may in fact know someone in their family or have a friend that's unemployed but i don't think it really hits home for most of us until we actually get to visualize it and see what's actually taking place in this country around the united states. >> the darker colors, the audience is watching, the darker the color, the higher unemployment rate. as time passed, the darker stain moved. what was most surprising to you and to people who have seen this map about what it shows? >> i think the most surprising thing for me, before i sat down to put it together i didn't exactly know, or i knew what the before and after looked like's i didn't realize what the progression itself would look like. that was the most significant thing that kind of hit home with me, and from what i'm hearing from people that have seen it through e-mails and various comments, and you know, i guess the most surprising thing to me is also that i received e-mail from someone who is currently unemployed and her comment was the unemployment -- being unemployed is very lonely at times and she said, thank you. thank you for helping me feel less lonely. so i think the most important thing for everyone to take from this is that you know, this is happening right now, and you know, it affects 31-plus million people. it affects our members at the machinist union and this crisis that has been going on for a while and the machinist union has been screaming it, saying something needs to be done and people need to walk away from this map and know that this is a very serious issue taking place. >> la toya, thank you so much. a grad school project. did you get an "a" for this? tell us you got an "a"? >> i did. i got an "a." >> good. that's nice to hear. thank you so much for joining us and thanks for bringing your map along. that purple illustration really shows the stark situation. the situation the president says will need more efforts to reverse. this week president obama says he wants to grow jobs by using excess t.a.r.p. money, or returned t.a.r.p. money to stimulate small business. republicans simply not happy with that. they want to pay down the deficit with that money and frankly say that's exactly what budget rules require. here's some of the discussion this week. >> this makes me so angry. i was there. all right? i know all about t.a.r.p. first it was never intended that all this money would ever have to be spent, but any money that wasn't spent was to go to the deficit, and the idea of taking this money and spending it is repulsive. >> ensuring that economic growth and job creation are strong and sustained is critical to ensuring that we are increasing revenues and decreasing spending on things like unemployment insurance so our deficits will start coming down. >> our esteemed guests are still here, ken, former chief economist at the ims and senior political analyst david gergen. ken what is the best way to get the economy moving again? to help lending for small businesses? to get jobs created? is it taking some of that money, or the wiggle room in the budget, and injecting it in other programs? >> christine, i'm very worried about the deficit down the road, but we're not down the road yet. and there has to be more fiscal stimulus, whether it's by stealth or through this directly. the fiscal stimulus comes out of the economy too quickly and it's phasing out the big impulse they had when obama came in office. we're going to be in trouble. they have to get rolling. this is just the first piece of it. >> david gergen, i want to ask you two numbers. 10%. the unemployment rate and this number, $1.4 trillion. that's the budget deficit. the graphic -- the graphic of the, of that, of that second number, the way we've gone from $300 billion in the bank in eight or nine years to $1.4 trillion deficit is frankly staggering, the red ink. that's what the republicans are screaming about for whatever reason. which number politically is more important, though. >> 10% or $1.4 trillion? >> detected right. in the near term, the 10%. in the long-term, the 1.4. ken co-authored a very important book on this subject about the, looking back over 800 years of economic history, how often after a financial crisis you face a second wave of a crisis if you don't manage your fiscal situation well. and so i think he's made that argument eloquently and it's been heard around the world. in the near term you've got get something going. i keep wondering whether there's not ways to redirect some of the original stimulus money which hasn't always been spent well, a lot of unnecessary and seemingly not very productive projects and getting some of that money that could be used as well as some of this t.a.r.p. money, but part of the t.a.r.p. money ought to be used. i think the president's right on this. part used for deficits but a significant bolstering that has to go on not only for extending unemployment and helping small business and local government. if you talk to school superintendents in major urban systems around the country they are facing much more significant layoffs in the coming year that what they've had already because of the seriousness and growing seriousness of the state and local budget deficits. they have to balance the budgets or fire people. >> you're right about that. i've talked to a lot of superintendents who said, look, our first round of stimulus money helps us through next year, but after that, a black hole for us. would it be better to target, maybe, state and local government aid right off the bat? or is that politically harder because it doesn't, you want to build a bridge and show there's job creation that way. funnel money to small businesses? should we do all of these things? >> maybe all of them, but i agree with david. state and local aid is the first thing. the government, the federal government, they can borrow money. the state and local governments a lot them have in their constitutions, the way they're set up they can't. tax revenue down, having to lay off police, schoolteachers, firemen, services cut back, hiking taxes. we don't want that in the teeth of a recession, and giving them money is probably the most helpful thing they can do with further stimulus money. >> jobs, leadership, banks, lending, all of these issues clearly coming to a boiling point here. david gergen thank you so much for joining us. ken, the name of his book "this time it's different" thanks for the plug for that one, for ken's book. thanks. if you rack up a ton of debt and can't pay your bills, watch out. what happens if the u.s. can't pay the bills. plus a lot more than talk going on at the big climate change conference in copenhagen. behind the scenes a lot of money is moving around. "s" stands for straightforward. as in up-front, honest... total transparency. straightforward is the way td ameritrade does business. simple, fair pricing. no hidden account fees. no shenanigans. just gptd value. real help. smart people who are easy to work with. that's what td ameritrade stands for. what does your investment firm stand for? it's time for fresh thinking. it's time for td ameritrade. i like having fun -- but i always use one. we used one just last night. it was awesome. knowing you're safe makes it even more pleasurable. hey, the guys on my team, we'll share the same one... for like a month at a time. if you care about me, you're gonna use one. wanna go home with me tonight? i'm the designated driver! thank you designated drivers. - thank you! - thank you! - thank you! ♪ someone needs to lighten up. ( women sing ) ♪ priceline negotiator! ( coughs ) - no vacation? - ( laughing ) i can't afford it. you can if you name your own price. - i don't know how. - it's easy. priceline has insider deals-- empty hotel rooms, open plane seats. ( laughing ) you can save up to half off! that's a great deal! saving money is no laughing matter. ( laughs ) back to our top story now. the showdown looming between president obama and ceos of the nation's top banks. joining us, joe is the author of "closing time" and joanne lippman, founding editor and chief and former deputy manager of the "wall street journal." so the president says we bailed these banks out. now we need help. need to start lending. banks say this is how we got in the mess in the first place, lending too much money and watching the moving parts for ceo compensation and watching potential financial regulatory reform, joanne. and it doesn't seem like they're coming along too willingly to this populous party. >> without question, without question, very late to the populous party. the question, the real issue is that obama has been grappling thins the moment he came into office with the sins of the original bailout for the banks which with no strings attached. you know, i don't think anybody imagined for a moment a year ago that once the banks was bailed out they would fail to lend. that they would sit on those reserves, and so every, you know -- the banks what they need is some sort of financial incentive that's going to force them or disincentive that will force them to lend, because there really hasn't been any way they've been forced into -- >> goldman sachs said they will lend $500 million to small business over five years, people immediately pointed out was a rounding error or daily float from their trading operation, you know, that a lot of critics said wasn't a lot of money. is this a showdown at the d.c. corral between the president and the bankers? >> the national guard, send them in. just have, like, a national guardsmen or better a ranger sitting at every desk saying -- >> maybe a navy s.e.a.l. >> perfect. saying if you don't start lending we're taking you out in the back and do that across the country, because there has to be some pressure on these guys to get them to lend money. >> yeah. >> why would -- they can make money doing nothing. so they'll do nothing. they've gone back to being what bankers used to be. gone back to being really tight, conservative, not wanting to help anybody, and that's not helping. >> they've gone back to wanting to get paid back on their loans, and something the regional bankers tell me, they have a lot of people who want money and a lot of people who, some who deserve it, some who they're afraid won't pay them back. worried about default. a fine line. >> being afraid they'll not pay back is part of being a bank. you're supposed to manage risk and say these three guys will go into the tank and this guy will start apple. that's the whole deal. the idea of them saying, we're afraid they won't pay it back. then you shouldn't be a banker. >> there you go. if you can't pay your bills you're in trouble. if washington reaches its debt limits, if it's maxed out its credit card, no problem. they simply raise the limit on the credit card. they raise the debt ceiling. at democrats plan on raising the debt ceiling as much as $1.8 trillion. some leading senators want to put together a bipartisan fiscal commission tanked with getting this under control. under the plan congress votes yes or no on the commission's recommendations. particularly some lawmakers bristling at the idea of losing a right to filibuster. is a fiscal commission the right way to get america's financial house in order? we have big problems opinion bipartisan financial commissions fix everything, right? >> oh, my gosh. this is exactly the kind of measure you would take if you just want to kick the can down the road. this commission, first of all not only do they have only a yes or no vote, but you need to get 60% vote in order to pass anything, and then you know what? commission no matter what, even if it was a brilliant idea with brilliant concepts, the fact this is a large problem and is is they're suggesting really just kind of fixing things around the edges. >> it's also incredibly cowardly, because it's saying, we will let these 60 wise old men, because you know who they're going to get. the usual old hacks to come in. blue ribbon panel, guys who went to yale you know, guys who went to stamford and they'll be, purport to be bipartisan but it's a way of saying, well, they told us we have to do this, because we don't want to take the heat. it's an incredibly cowardly thing to do. the other thing i really think is, when i was growing up in the '60s there were these kind of wise old guys and lbj would go and talk to these people. i don't think they're out there anymore. i don't think there are any, like, wise people out there. i think all of the smart people we've seen them on, this it. we're stuck. there's not like a paul volckers who can say, can you come in and fix the problems of our society. they're not there. forget it. >> the big issue really is that we have spent over the last year over a trillion dollars in various programs. there's no kind of unifying strategy behind that, and any normal, responsible business would say, if we're spending t