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CNN Student News Transcript: May 22, 2008

  • Story Highlights
  • Hear what issues were discussed when oil executives met with Congress
  • Examine some companies' commitment to investing in alternative energy
  • Check out a challenge that tests students' understanding of economics
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(CNN Student News) -- May 22, 2008

Quick Guide

High Cost of Gas - Hear what issues were discussed when oil executives met with Congress.

Going Green - Examine some companies' commitment to investing in alternative energy.

Dollars and Sense - Check out a challenge that tests students' understanding of economics.

Transcript

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

CARL AZUZ, CNN STUDENT NEWS ANCHOR: Hi, I'm Carl Azuz. It is two days til the weekend, and that means it's time for our Thursday edition of CNN Student News. Thank you for tuning in.

First Up: High Cost of Gas

AZUZ: First up, oil and gas prices are on the rise! Sound familiar? It should. Both are reaching new records almost every day, more than 133 bucks for a barrel of oil Wednesday, and more than $3.80 for a gallon of regular unleaded. This might not matter if you're driving a horse, but it's a big deal for all of us who need our cars to get anywhere. That's why Congress is turning up the heat on oil companies. On Wednesday, oil executives came to Capitol Hill to talk about this issue. During the hearing, one senator claimed that "prices shouldn't skyrocket like this in a properly functioning market." An oil executive responded that the high costs are connected to what he called failures to increase supplies, renewables and conservation in the U.S. and overseas. He added that the oil companies "can't change the world market." Both the legislators and the executives are considering alternative energy sources, but those aren't cheap.

J. STEPHEN SIMON, SENIOR VICE PRESIDENT, EXXON MOBIL: To meet the world's growing demand for energy of all types, an estimated total investment of $22 trillion is needed between 2006 and 2030, or roughly 8 times the size of the estimated 2007 federal budget.

Shoutout

STAN CASE, CNN STUDENT NEWS: Time for the Shoutout! In economic terms, ROI stands for "return on" what? Is it: A) Incentive, B) Interest, C) Investment or D) Innovation? You've got three seconds -- GO! You can "C" your way to the right answer here. Return on investment refers to the income that any investment provides in a specific period of time. That's your answer and that's your Shoutout!

Going Green

AZUZ: You might have seen some commercials about oil companies investing in alternative energy. But you just heard how expensive that can be, and the companies have to consider what kind of a return they can get on that investment. After all, they're businesses; they're supposed to make money. Allan Chernoff examines these companies' commitment to going green.

(BEGIN VIDEO CLIP)

CHEVRON AD: That an oil company can practice and espouse conservation. Not corporate titans, but men and women of vision, people who daily try to find new ways, cleaner ways to power the world.

ALLAN CHERNOFF, CNN REPORTER: It's a message we're hearing more often from some of the biggest companies on the planet; oil giants, which provide the fossil fuels we burn, that are, in turn, blamed for global warming. Chevron and BP have been most aggressive in promoting their commitment to alternative energy.

BP AD: We need to really be cautious of what we put into our cars, just like we put into our bodies. And we need to make that shift that, well, what we're doing is really messing things up.

CHERNOFF: Media watchdog critics say don't believe the hype.

JOHN STAUBER, PR WATCH: What these companies are doing is called "greenwashing." They want to look as green and environmental as possible.

CHERNOFF: BP, which was the first oil giant to acknowledge concern about global warming, plans to spend about $1.5 billion dollars this year on alternative energy projects including wind, solar and hydrogen-fueled power plants. That's more than 6 percent of the company's capital investments. Chevron has made a three-year alternative energy commitment of $2.5 billion dollars through next year, which would amount to about 4 percent of Chevron's investments in energy resources. It's not enough, say environmentalists, who claim that the investments are merely symbolic.

DERON LOVAAS, NRDC: Small, baby steps when they could be taking giant strides, given the revenue that they're raking in because of these high prices.

CHERNOFF: Chevron and BP declined to appear on camera, but say their investments are significant and may grow. Chevron told CNN, "It is prudent to take proactive steps to position Chevron for future leadership in important sources of renewable energy." BP recently told investors, "Alternative energy is expected to be a major part of the global energy mix in the future, and energy is BP's business."

SHELL EUREKA AD: Fewer wells means less destruction and less waste.

CHERNOFF: In a recent ad, Shell promoted its horizontal oil drilling as environmentally conscious. Shell is boosting investment in wind energy in Texas, though it recently announced plans to pull out of a major wind power plant off the British coast. Allan Chernoff, CNN, New York.

(END VIDEO CLIP)

Dollars and Sense

AZUZ: With oil and gas prices dominating the headlines, don't be surprised if the topic turns up in the National Economics Challenge! It's the only nationwide econ contest for high school students. To win, you need a strong understanding of economic concepts, a good grasp on financial news stories and a lightning-fast buzzer finger. Here's a look at this year's event.

(BEGIN VIDEO CLIP)

DR. ROBERT F. DUVALL, PRESIDENT OF NCEE: It is my pleasure to welcome you (BUZZER) to the 2008...

JUDGE: You have 5 seconds.

DUVALL: ...NCEE/Goldman Sachs...

JUDGE: Answer please.

DUVALL: ...Foundation National Economics Challenge.

JUDGE: That is correct.

STUDENT COMPETITOR: 155.

JUDGE: 155 is correct, to buy 100 euros.

JANE SCHAFER, COACH, VESTAVIA HILLS HIGH SCHOOL: Current events.

STUDENT COMPETITOR: Foreign investment effect.

SCHAFER: We're constantly watching to see the things in the news...

STUDENT COMPETITOR: Decreasing returns to scale.

SCHAFER: ...That might be related to economics.

STUDENT COMPETITOR: Voelker and Greenspan.

SCHAFER: I told them this year at a couple practices, all the top headlines are economics.

JUDGE: Shutdown is correct.

DUVALL: This program was designed to show how we can really reach the students in a competitive environment.

STUDENT COMPETITOR: Capital.

DUVALL: This shows that these students have gotten that basic skill set...

STUDENT COMPETITOR: Labor

DUVALL: ...that they can use in their lives, all their lives.

JUDGE: The score is 4 to 2. This is question number 7.

STUDENT COMPETITOR: Bear Stearns.

STUDENT COMPETITOR: We had a microeconomics, one-semester course, and then outside of class we would meet about once a week.

STUDENT COMPETITOR: We've been working on, like, speed forever. (BUZZER) We mostly do buzzers.

STUDENT COMPETITOR: With the buzzers.

SCHAFER: He liked the buzzer. He was obsessed with the buzzer.

STUDENT COMPETITOR: Like, if you want to get faster, you can practice with a pen, clicking it back and forth. We used to do that in middle school, but we're too cool for that now.

DUVALL: If the price of X is six dollars, what is the (BUZZER)...

SCHAFER: When you hear them giving answers to questions that we've discussed, topics...You know, we've discussed the Costco-Walmart rice quotas in class. They were listening! It's a nice, proud moment.

STUDENT COMPETITOR: Two dollars.

JUDGE: That is correct.

DUVALL: What effect is responsible for the backward-bending...

STUDENT COMPETITOR: What is the wealth effect?

DUVALL: The judges are conferring.

JUDGE: That is incorrect.

DUVALL: The students are so bright and quick, sometimes they will buzz in the answer before I get the whole question out.

DUVALL: Describe the activity of a company that attempts to drive its (BUZZER)...

STUDENT COMPETITOR: Predatory pricing.

JUDGE: Predatory pricing is correct.

DUVALL: I think it would make a tremendous difference in this country if people were economically and financially literate. You know, we have a negative savings rate in this country right now. That's not good for individuals, and it's not good for the future of the nation.

SCHAFER: Some of this stuff gets really technical and pretty high level.

JUDGE: Too late to buzz in. Collateralized debt obligation.

SCHAFER: Basic things like supply and demand, and inflation, I think it's so important that the general public understands.

JUDGE: Stagflation is correct.

DUVALL: We can show that young people can learn economics...

STUDENT COMPETITOR: Helps you better evaluate yourself as far as, what does this mean in the context of me.

DUVALL: ...and it makes all the difference in their lives, and makes us hopeful about the future of this country.

STUDENT COMPETITOR: Ten dollars is the price and 800 units of output.

JUDGE: That is correct. You are the national champions.

(END VIDEO CLIP)

Myanmar Update

AZUZ: Heading to Myanmar now, the U.N. secretary general is urging the country's government to focus on saving lives, not on politics, in the aftermath of a deadly cyclone. This plea comes after Myanmar's leaders refused a proposal for U.S. warships to deliver relief supplies. They had previously allowed some U.S. aid flights to enter the country, but they've rejected this latest plan. The government is slowly accepting help from some of its neighboring countries.

Impact Your World

AZUZ: Some international organizations are working to help the victims of this cyclone, and these groups can use your assistance. Go to CNN.com/impact and learn how you can impact your world.

Blog Report

AZUZ: Someone named "Cheeto" had an interesting argument on our blog. He said we're probably better off sending text messages than cards. Writing letters wastes trees, he says. We wouldn't want that now, would we? That's just one of the hundreds of posts we've gotten in the last week. Kristy logged on to rave about Mrs. Bennett, saying this teacher will never give up on a student. Gregory says the Free Rice site is a unique convergence of vocabulary, generosity and amusement; you can tell he's been playing a bit. Kathie says paying students to study is the most absurd idea she's ever heard, asking how that is fair to the other students who do what they're supposed to do. But Matthew said if he got paid to study, he'd do it every day, every second; he loves money. And it's all about the Bruins, says Abigail: "No argument about it, UCLA is the place to go to college." I respect your opinion, Abigail, but I bet a lot more people can identify a bulldog than a bruin. Go Dawgs!

Before We Go

AZUZ: You might see me root for a bruin... when fish fly! Uh-oh. This cold-blooded customer skimmed the surface of waters near Japan, and it stayed airborne a full 45 seconds! That's believed to be the longest fish flight ever caught on camera! So, how does it do it? Well, the fish's fins work like wings, helping it glide through the air. Yeah, it's not really flying. But a gliding fish doesn't sound nearly as cool.

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Goodbye

AZUZ: A story of that scale seems like a good place to finish today's show. I'm Carl Azuz.

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