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CNN Student News Transcript: September 17, 2008

  • Story Highlights
  • Discover the Federal Reserve's response to the latest concerns on Wall Street
  • Learn how one California high school is addressing its high dropout rate
  • Celebrate Constitution Day with a test of some details about the document
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(CNN Student News) -- September 17, 2008

Quick Guide

Wall Street Woes - Discover the Federal Reserve's response to the latest concerns on Wall Street.

Stopping Dropouts - Learn how one California high school is addressing its high dropout rate.

Constitution Day - Celebrate Constitution Day with a test of some details about the document.

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: It is Constitution Day, and we're glad you're spending part of it with CNN Student News. I'm Carl Azuz.

First Up: Wall Street Woes

AZUZ: First up, the nation's central bank is taking a wait-and-see approach to recent turmoil in the financial industry. Yesterday, we told you about Lehman Brothers, a major investment firm that declared bankruptcy. Many on Wall Street were hoping the Federal Reserve, or Fed, would lower the federal funds rate to offset the news. The rate affects different types of loans, and reducing it pushes money into the economy. But the Fed believes rates are low enough already. There might be some good news for Lehman employees though. Sources say that Barclays, a different bank, has reached an agreement to buy part of the investment giant. The deal could save thousands of jobs. In the meantime, another major U.S. firm, AIG, is trying to keep its doors open. Mary Snow reports on the concerns surrounding this insurance company.

(BEGIN VIDEO CLIP)

MARY SNOW, CNN REPORTER: At the center of the drama on Wall Street: the fate of American International Group, AIG. The world's largest insurance company is frantically trying to raise enough cash to stave off bankruptcy. This on the heels of the collapse of investment bank Lehman Brothers. Many on Wall Street warned a failure of AIG would be far worse, and hoped the government would provide some sort of life raft.

BOB LENZNER, NATIONAL EDITOR, FORBES MAGAZINE: AIG has got transactions all over the world with banks, investment banks, insurance companies, hedge funds and multi-national companies. They can't afford to let it go bankrupt.

SNOW: AIG has businesses in some 130 countries that span from insurance on mortgages, cars, life insurance to airplane leasing. A blow to them would trigger widespread ripple effects. Adding to the crisis: three credit agencies downgraded AIG's credit rating, making it tougher to borrow money.

PETER MORICI, UNIV. OF MARYLAND SCHOOL OF BUSINESS: If AIG fails because it has inadequate money to back up all the foreclosures that are taking place, then it creates problems for the big banks in New York. They don't have enough money.

SNOW: As worries mounted, the Federal Reserve decided not to cut interest rates. It said strains in financial markets have "increased significantly," and noted worries about inflation as a reason why it left interest rates unchanged.

ALAN BLINDER, FORMER FED VICE CHAIRMAN: A lot of people were thinking the Fed would cut interest rates. I think if the stock market and the other markets had really been disastrous today, maybe they would have.

SNOW: Some say the Federal Reserve's decision not to cut interest rates may have calmed some fears about a worsening financial crisis by sending the signal that the Federal Reserve didn't feel that more economic stimulus was necessary right now.

(END VIDEO CLIP)

Spoken Word

HENRY M. PAULSON, JR., SECRETARY OF THE TREASURY: Well, I've got to say, our banking system is a safe and a sound one. And since the days when we've had federal deposit insurance in place, we haven't had a depositor who's got less than $100,000 in an account lose a penny. So, the American people can be very, very confident about their accounts in our banking system.

Stopping Dropouts

AZUZ: Turning our attention to school. It's where most of you are right now, but many students aren't in class. In fact, according to America's Promise Alliance, someone drops out of high school every 26 seconds! So, what can schools do to keep students in class? Chris Lawrence visits one in California that has an incredibly high dropout rate to see how they're addressing this issue.

(BEGIN VIDEO CLIP)

CHRIS LAWRENCE, CNN REPORTER: It's the first week of their freshman year, and some of these girls already have one foot out the door.

ANA ROSA GUTIERREZ, FRESHMAN: Cause I don't like school. I don't know, you just sit down, you just hear the teacher. It's boring.

LAWRENCE: Ana Rosa Gutierrez knows a lot of kids who've quit.

GUTIERREZ: My brother dropped out because we needed money. He got a job.

LAWRENCE: How old was he?

GUTIERREZ: I think 16.

LAWRENCE: At Jefferson High School, 58% of students drop out.

TEACHER: Louis Romero? Louis is absent.

LAWRENCE: The families are, for the most part, poor. About half the students are learning English as a second language. Nearly 75% of Jefferson's parents did not graduate high school themselves, but the school is trying to hold them accountable.

DAVID BREWER, LOS ANGELES SCHOOLS SUPERINTENDENT: If their students are absent a lot, then the city attorney goes to the parents and says, "Listen, if you don't get your kids in school then you could go to jail."

JUAN FLECHA, JEFFERSON HIGH SCHOOL PRINCIPAL: Why were you late? Huh? Why were you late?

LAWRENCE: Jefferson's principal says students have to adopt a military mindset just to get to school, and devise strategic routes through gang territory.

FLECHA: There are certain blocks where they know that it's just not safe to go through there, and have to establish a very elaborate pathway from home to school.

LAWRENCE: Three years ago, the school exploded in bloody riots between blacks and Latinos. Since then, Jefferson has beefed up security and started keeping students with the same small group of teachers to form stronger bonds over the 4 years. It helped seniors like Ashley Romero, who raised her grades, joined the debate team and got elected class president, all while being raised by a single mother without much money.

ASHLEY ROMERO, SENIOR: It never, ever crossed my mind to drop out, because I always had the mentality to help my mom out.

LAWRENCE: The school is hiring 10 new teachers and a psychiatric social worker. But is it enough to encourage freshmen like Ana Rosa to stay through senior year?

GUTIERREZ: Hopefully. Hopefully I will. I don't know.

LAWRENCE: But you're not sure?

GUTIERREZ: I'm not sure.

(END VIDEO CLIP)

Blog Promo

AZUZ: You guys probably understand this situation better than anyone else. Maybe you or someone you know has struggled with staying in school. So, we want to hear your solutions about preventing dropouts. Head to our blog at CNNStudentNews.com and tell us what you're thinking.

Fast Facts

ERIC GERSHON, CNN STUDENT NEWS: Time for some Fast Facts about the U.S. Constitution! The original goal of the Constitutional Convention wasn't to write a new document, but revise an existing one. That changed after debate among the delegates. It takes about half an hour to read the Constitution, which has 4,543 words, including the signatures. One name that doesn't appear in the document? The person who prepared and copied down the final text: Jacob Shallus.

Constitution Day

AZUZ: Kind of random, but as we said before, the reason we're talking about this is because it's Constitution Day, the anniversary of when the convention delegates signed off on the manuscript that established our system of government. So to celebrate, we're putting you to the test with some constitutional trivia.

(BEGIN VIDEO CLIP)

AZUZ: You now know that the Constitution was signed on September 17th, but in what year? Was it 1776, 1781, 1787 or 1800? You might think "A" at first, but that's when America declared its independence from Britain. The Constitution was signed 11 years later in 1787. Thirty-nine men put their signatures on it; but which two Founding Fathers weren't there? Were they John Adams and Benjamin Franklin, John Adams and Thomas Jefferson, James Madison and Benjamin Franklin or James Madison and Thomas Jefferson? Tough one here. John Adams was in Great Britain and Thomas Jefferson was in France, both representing the U.S., and neither there to sign the Constitution.

There was also a state absent from the Constitutional Convention. That is to say, one state wasn't represented. Which was it? Virginia, Georgia, New Jersey or Rhode Island? One of these saw the convention as an attempt to overthrow its own government, and that state was Rhode Island.

Now, let's step inside the Constitution. It's an election year, after all. So tell us, how old do you have to be to run for president: 21, 25, 30 or 35 years old? To serve in the nation's top job, you've got to be a natural born citizen who's lived in the U.S. for at least 14 years, and you've got to be at least 35 years old.

And now, Congress. Which part of the Constitution specifies the duties and powers Congress has? Article I, Article II, Article III, or Amendment 1? It's all about "A" here: Article I also specifies the terms in the U.S. House and Senate.

Back to amendments: How many are there to the U.S. Constitution? 10, 26, 27 or 28? The last one was proposed in 1789 but not ratified until 1992: Amendment 27 limits Congress' authority to give itself a pay raise.

If you answered "A" to the last question, you might've had the number of amendments confused with this: It's what the first ten amendments are also known as: Articles of Confederation, Preamble, Declaration of Rights or the Bill of Rights? The first ten amendments are meant to ensure personal civil liberties, and they're known as the Bill of Rights. And that wraps up your Constitution Quiz this Constitution Day.

(END VIDEO CLIP)

Promo

AZUZ: But our coverage of Constitution Day continues online! Our One-Sheet examines connections between the Constitution and current issues, and our Learning Activity challenges students to identify how the historic document applies today. Check out both of these resources at CNNStudentNews.com!

Hispanic Heritage Month

AZUZ: This week also marks the start of Hispanic Heritage Month. To mark the occasion we're profiling prominent members of the Hispanic community over the next several weeks, starting with an award-winning entertainer.

(BEGIN VIDEO CLIP)

TATYANA HEREDIA, CNN STUDENT NEWS: Born in 1931 in Puerto Rico, Rita Moreno is the first Hispanic American to have won all four of entertainment's biggest awards: a Tony, a Grammy, an Emmy and an Oscar. At the age of 13, she made her first professional debut on Broadway in New York City. During her career, Moreno has appeared in more than 40 films and dozens of TV shows, including "The Electric Company," "The Rockford Files," "Oz" and "Ugly Betty." In addition to her work as an entertainer, Moreno has worked with many civic and charitable organizations, including the National Endowment for the Arts. In 2004, Moreno was awarded the Presidential Medal of Freedom, the nation's highest civilian award. Celebrating the life and work of Rita Moreno this Hispanic Heritage Month.

(END VIDEO CLIP)

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Goodbye

AZUZ: That's where the curtain comes down for today. I'm Carl Azuz.

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