PBS NewsHour; August 9, 2012 6:00pm-7:00pm PDT

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>> Brown: THE HOUSING MARKET IS SHOWING MORE SIGNS OF MENDING FROM THE DEPTHS OF THE FORECLOSURE CRISIS. A NEW REPORT FROM REALTY-TRAC FINDS BANKS ARE REPOSSESSING FEWER HOMES THAN A YEAR AGO, AND GENERAL FORECLOSURE ACTIVITY HAS DECLINED FOR 22 CONSECUTIVE MONTHS. STILL, THERE WAS PLENTY OF SOBERING NEWS. THE NUMBER OF HOMES IN JULY THAT RECEIVED AN INITIAL NOTICE OF DEFAULT, THE FIRST STEP IN A FORECLOSURE, WAS UP 6% FROM A YEAR AGO, AND NEARLY 60,000 HOMES ARE BEING REPOSSESSED BY LENDERS EACH MONTH. CALIFORNIA HAS THE HIGHEST FORECLOSURE RATE, WITH ONE IN EVERY 325 HOMES RECEIVING A FORECLOSURE NOTICE LAST MONTH. GUY CECALA WATCHES ALL THIS CLOSELY AS C.E.O. AND PUBLISHER OF "INSIDE MORTGAGE FINANCE," A HOUSING INDUSTRY RESEARCH PUBLICATION.

>> WELCOME TO YOU.

>> THANK YOU.

>> Brown: FILINGS ARE DOWN. EXPLAIN THAT PART OF THE EQUATION. WHAT'S GOING ON?

>> FILINGS ARE DOWN BASICALLY MEANS WE'RE SEEING LESS PEOPLE GETTING INTO TROUBLE DUE TO JOB LOSS. AN IMPROVING ECONOMY IS HELPING THE NUMBER OF PEOPLE FLOWING INTO THE SYSTEM. BUT WE HAVE A LOT OF PEOPLE WHO HAVE BEEN IN THE SYSTEM FOR A WHILE AND ARE FACING FORECLOSURE

>> Brown: SO FORECLOSURE ACTION. I WANT TO UNDERSTAND WHAT WE MEAN BY THESE... PARSE THESE NUMBERS FOR US. WHAT DOES THAT MEAN?

>> THERE ARE A COUPLE STEPS IN THE FORECLOSURE. OBVIOUSLY FIRST ONE IS YOU GO INTO DEFAULT AND LEGALLY SOMEONE'S GOT TO FILE A DEFAULT NOTICE, USUALLY THE LENDER ON YOUR ON THEIR BEHALF AND THE NEXT THING THEY DO IS INITIATE A FORECLOSURE. THE FINAL STEP THAT MAY TAKE PLACE A YEAR LATER IS ACTUALLY EVICTING SOMEONE FROM A HOME AND HAVING A FORECLOSURE SALE. SO THERE ARE MANY STEPS ALONG THAT WAY.

>> Brown: ALSO AS YOU SAID A BIG DECLINE IN THE BANK REPOSSESSIONS OF HOUSES. WHAT'S LED TO THAT?

>> I THINK THERE'S BEEN SOME IMPROVEMENT IN THE SITUATION. IN SO T MARKETPLACE THAT WAS SEEN IN TERMS OF FORECLOSURES OVERALL. THE INVENTORY OF FORECLOSURES IS DOWN. PROBABLY THE LOWEST LEVEL WE'VE SEEN IN THREE YEARS. IN FACT, THE MORTGAGE BANKERS' ASSOCIATION RELEASED DATA TODAY ON THAT FORECLOSURE INVENTORY. SO THERE ARE SOME IMPROVING SIGNS. IT'S JUST THAT IT'S NOT ACROSS THE BOARD YET AND IT'S CERTAINLY HUGE PROBLEM. WE'RE FAR FROM OUTSIDE OF THE FORECLOSURE PRICES.

>> Brown: EXPLAIN THE OTHER PART OF THE EQUATION. AT THE SAME TIME, THE FILINGS WERE DOWN, NEW FORECLOSURES ARE UP.

>> YEAH.

>> Brown: WHAT DOES THAT MEAN?

>> THAT PRETTY MUCH MEANS THAT LENDERS-- PARTICULARLY IN WHAT WE CALL JUDICIAL FORECLOSURE STATES, THE ONES THEY HAVE TO GO THROUGH THE COURT-- ARE WORKING THROUGH A BACKLOG THAT BUILT UP LAST YEAR DUE TO PENDING LITIGATION, THE ATTORNEY GENERALS IN THE UNITED STATES WERE BANNING TOGETHER TO GO AFTER THE MAJOR SERVICERS AND BASICALLY A LOT OF FORECLOSURES WERE PUT ON HOLD, OR AT LEAST THE FINAL STEP OF TRYING TO SELL OFF THE PROPERTY.

>> Brown: BRING US UP TO DATE ON THAT, BECAUSE WE WATCHED IT CAREFULLY, THERE WAS THAT... THERE WAS THAT BACKLOG, AS YOU SAY AND A KIND OF STOPPAGE, RIGHTING? AND THEN IS SETTLEMENT. SO WAS WHERE DOES ALL THAT STAND?

>> WELL, THEORETICALLY IT'S OPENED THE DOOR FOR SERVICES TO PRI PROCEED CAUTIOUSLY IN PURSUING FORECLOSURES NOW AND IN SOME OF THE STATE THE ONES WITH JUDICIAL FORECLOSURES WE'RE STARTING TO SEE ACTION PICK UP, MEANING MORE FORECLOSURES ARE TRYING TO WORK THROUGH THE BACKLOGS. BUT IT'S STILL A SLOW PROCESS.

>> Brown: SO THE OVERALL POOL OF PEOPLE IN THE FORECLOSURE ARE COMING DOWN BUT IT'S STILL INCREASING?

>> EXACTLY. WE'RE STILL SELLING... THE BANKS ARE DOING A GOOD JOB IN TERMS OF SELLING THE PROPERTIES ONCE THEY COME OUT OF FORECLOSURE, TOO, AND THAT'S THE SIGN OF A HEALING HOUSING MARKET AND THERE'S MORE DEMAND THAN IT HAS BEEN IN FOUR OR FIVE YEARS.

>> Brown: THIS IS STILL A REGIONAL PHENOMENON, RIGHT? IT DEPENDS WHERE YOU ARE?

>> EXACTLY. IT VARIES DRAMATICALLY BY REGION. WE'VE BEEN WATCHING THE SAND STATES, PARTS OF CALIFORNIA, NEVADA, ARIZONA, AND FLORIDA BECAUSE THEY WERE THE HARDEST HIT BY THE FORECLOSURE CRISIS AND TO SOME EXTENT THEY'RE SHOWING THE MOST IMMEDIATE SIGNS OF IMPROVEMENT. WE'RE STARTING TO SEE SOME HOME PRICES MOVE UPWARD IN THOSE AREAS.

>> Brown: YOU SAY CALIFORNIA BUT CALIFORNIA AS WE SAID STILL THAT HAS MOST. BECAUSE OF THE DEPTH OF THE PROBLEM.

>> IT IS. IT'S THE LARGEST STATE IN TERMS OF PEOPLE, MORTGAGES AND EVERYTHING ELSE. IT'S ALSO LIKE THREE DIFFERENT REGIONS LIKE SAN DIEGO'S VERY DIFFERENT THAN THE SAN FRANCISCO HOUSING MARKET SO IT'S HARD TO MAKE SOME GENERALITIES ABOUT THE STATE THAT SIZE.

>> Brown: AND WHAT ABOUT REGIONS OR STATES THAT ARE STILL REALLY STUCK AND MIRED?

>> WELL, THERE'S SOME STATES LIKE MICHIGAN, OHIO THAT NEVER REALLY HAD A HOUSING BOOM AND WE DON'T SEE ANY RECOVERY. THEY BASICALLY HAD THE HOUSING BUST PART OF IT.

>> Brown: WHAT ABOUT THE OTHER SIGNS THAT YOU LOOK AT FOR THE HEALTH OF THE SECTOR. I SAW FANNIE MAE AND FREDDIE MAC PROFIT. WHAT DOES THAT TELL YOU?

>> WELL, THAT'S VERY INTERESTING BECAUSE THEY'RE KIND OF A BAROMETER OF THE HEALTH OF THE HOUSING MARKET AND THE MORTGAGE MARKET SINCE THEY'VE BEEN POSTING LITERALLY BILLIONS OF DOLLARS OF LOSS. TAXPAYERS HAVE PAID SOMETHING LIKE $142 BILLION INTO THOSE COMPANIES.

>> Brown: THAT'S WHY I NOTED THE PROFIT.

>> BECAUSE OF THE LOSSES THEY'VE TAKEN, A LOT OF IT THESE DO WITH THE FACT THAT NOT ONLY HAVE THEY HAD MORTGAGES GO BAD AND HAD TO REPOSSESS THE PROPERTIES BUT WHEN THEY HAD TO TURN AROUND AND SELL THEM THEY SOLD THEM AT LESS THAN THE VALUE OF THE PROPERTIES WAS ORIGINALLY AND BOTH OF THOSE THINGS ARE IMPROVING. THEY'RE SELLING MORE PROPERTY, HIGHER PRICES AND SEEING LESS LOANS GO BAD.

>> Brown: ALL RIGHT GUY CECALA ON THE HOUSING MARKET, THANK YOU.

>> Woodruff: STILL TO COME ON THE NEWSHOUR: WELFARE'S PROMISE AND REALITY; AN ENERGY COMPROMISE IN UTAH; WHY WORDS MATTER TO JUSTICE ANTONIN SCALIA; CHINA'S CELEBRATED MURDER TRIAL; AND WOMEN SCORE BIG AT THE OLYMPICS. BUT FIRST, THE OTHER NEWS OF THE DAY. HERE'S KWAME HOLMAN.

>> Reporter: SEVERE DROUGHT CONDITIONS HAVE SPREAD ACROSS EVEN MORE OF THE U.S. BREADBASKET. THAT'S THE LATEST FINDING FROM THE DROUGHT MONITOR REPORT BY FEDERAL AGENCIES AND THE UNIVERSITY OF NEBRASKA. THEIR WEEKLY MAP SHOWS AREAS OF EXTREME OR EXCEPTIONAL DROUGHT-- MARKED HERE IN RED AND BURGUNDY- - GREW BY 2% FROM THE WEEK BEFORE. THE LACK OF RAINFALL HAS HIT PRODUCERS OF CORN AND SOYBEANS ESPECIALLY HARD AND PUSHED WORLD COMMODITY PRICES SHARPLY HIGHER. MORE BAD NEWS FOR THE NEARLY INSOLVENT U.S. POSTAL SERVICE. IT LOST $5.2 BILLION FROM APRIL TO JUNE, MUCH MORE THAN THE SAME PERIOD LAST YEAR. THE BULK OF THE LOSS CAME FROM THE PROJECTED COST OF HEALTH BENEFITS FOR FUTURE POSTAL RETIREES. LAST WEEK, THE POSTAL SERVICE FAILED FOR THE FIRST TIME EVER TO MAKE A SCHEDULED PAYMENT FOR THOSE BENEFITS. SYRIAN TROOPS AND REBELS HAMMERED AWAY AT EACH OTHER TODAY AROUND THE BESIEGED CITY OF ALEPPO, SYRIA. BOMBED-OUT SECTIONS OF THE CITY STILL WERE BEING TARGETED BY GOVERNMENT AIR STRIKES. AND THE DAMAGE WAS SO HEAVY BOTH REBELS AND GOVERNMENT TANKS REPORTEDLY WERE FORCED TO PULL BACK IN SOME AREAS. ALSO TODAY, IRAN, SYRIA'S MAIN BACKER, CONVENED A MEETING ON HOW TO END THE CONFLICT. THE IRANIAN FOREIGN MINISTER BLAMED SYRIAN REBELS FOR A LIST OF CRIMES, INCLUDING THE ABDUCTION OF 48 IRANIANS LAST WEEKEND.

>> ( translated ): EXPLOSIONS, THE KIDNAPPING OF ORDINARY CITIZENS AND PILGRIMS FROM OTHER COUNTRIES, USING HUMAN SHIELDS AND THE INCREASING ACTIVITIES BY EXTREMIST GROUPS WITH THE SUPPORT OF FROM REGIONAL AND INTERNATIONAL PARTIES INDICATE SOME AGENDAS BEYOND SYRIA ARE BEING PURSUED IN THE REGION.

>> Reporter: THE REBELS HAVE SAID THE IRANIAN HOSTAGES WERE MEMBERS OF IRAN'S MILITARY ON A SPYING MISSION. IN ALL, 28 NATIONS ATTENDED THE TEHRAN CONFERENCE TODAY, BUT WESTERN GOVERNMENTS DISMISSED THE GATHERING. IN EGYPT, GUNMEN FIRED ON A POLICE STATION IN THE NORTHERN SINAI, TOUCHING OFF A NEW FIREFIGHT WITH EGYPTIAN FORCES. IT WAS THE LATEST IN A SERIES OF ATTACKS ON THE VOLATILE PENINSULA WHERE GAZA, ISRAEL AND EGYPT INTERSECT. ISLAMIC MILITANTS STRUCK A BORDER CROSSING ON SUNDAY, KILLING 16 EGYPTIAN POLICEMEN. THE EGYPTIAN MILITARY RETALIATED YESTERDAY WITH AIR STRIKES. AT THE LONDON OLYMPICS TODAY, A DAZZLING DISPLAY IN TRACK AND A MAJOR WIN IN SOCCER. SPOILER ALERT: YOU MAY WANT TO TUNE OUT FOR A FEW MOMENTS WHILE WE GIVE SOME OF TODAY'S RESULTS. IN TRACK, USAIN BOLT RAN TO VICTORY IN THE 200 METERS, ADDING TO HIS GOLD IN THE 100. HE'S THE ONLY MAN TO WIN BOTH EVENTS AT CONSECUTIVE OLYMPICS. THE U.S. WOMEN'S SOCCER TEAM CAPTURED A THIRD STRAIGHT OLYMPIC GOLD, BEATING JAPAN 2-1 BEFORE 80,000 FANS. AND AMERICAN MIDDLEWEIGHT CLARESSA SHIELDS WON GOLD IN THE OLYMPICS DEBUT FOR WOMEN'S BOXING. GOOGLE HAS AGREED TO PAY $22 MILLION OVER ALLEGATIONS IT TRACKED MILLIONS OF WEB SURFERS. THE SETTLEMENT INVOLVED PEOPLE WHO USED APPLE'S SAFARI WEB BROWSER. THE FEDERAL TRADE COMMISSION CHARGED THE ONLINE SEARCH GIANT BROKE A PROMISE NOT TO MISLEAD CONSUMERS ABOUT ITS PRIVACY PRACTICES. IT'S THE LARGEST FINE THE AGENCY HAS EVER IMPOSED IN SUCH A CASE. WALL STREET NEVER GOT MUCH TRACTION TODAY. THE DOW JONES INDUSTRIAL AVERAGE LOST TEN POINTS TO CLOSE AT 13,165. THE NASDAQ ROSE SEVEN POINTS TO CLOSE AT 3,018. THOSE ARE SOME OF THE DAY'S MAJOR STORIES. NOW, BACK TO JUDY.

>> Woodruff: IT'S BEEN MANY YEARS, EVEN DECADES, SINCE POVERTY-- AND MORE SPECIFICALLY, WELFARE-- HAS BEEN THE CENTER OF ATTENTION ON THE NATIONAL POLITICAL STAGE, BUT DUELING CLAIMS FROM BOTH PRESIDENTIAL CAMPAIGNS PUT THOSE SUBJECTS IN THE POLITICAL ARENA THIS WEEK.

>> UNDER OBAMA'S PLAN, YOU WOULDN'T HAVE TO WORK, AND WOULDN'T HAVE TO TRAIN FOR A JOB. THEY JUST SEND YOU YOUR WELFARE CHECK.

>> Woodruff: THE AD BEGAN AIRING THIS WEEK. IT REFERS TO A DECISION BY THE OBAMA ADMINISTRATION LAST MONTH TO HEAR REQUESTS FROM TWO REPUBLICAN GOVERNORS-- BRIAN SANDOVAL OF NEVADA AND GARY HERBERT OF UTAH-- FOR WAIVERS OR EXCEPTIONS, ALLOWING STATE CHANGES TO FEDERALLY FUNDED WELFARE-TO-WORK PROGRAMS. AT A RALLY IN DES MOINES, IOWA, YESTERDAY, GOVERNOR ROMNEY SAID ALLOWING THOSE CHANGES WOULD BE A STEP IN THE WRONG DIRECTION.

>> AS A RESULT OF PUTTING WORK TOGETHER WITH WELFARE, THE NUMBER OF PEOPLE ON WELFARE WAS CUT IN HALF; POVERTY WAS REDUCED. FIVE STRAIGHT YEARS THE LEVEL OF POVERTY IN THIS COUNTRY CAME DOWN. IT IS WRONG TO MAKE ANY CHANGE THAT WOULD MAKE AMERICA MORE OF A NATION OF GOVERNMENT DEPENDENCY. WE MUST RESTORE AND I WILL RESTORE WORK INTO WELFARE. ( CHEERS AND APPLAUSE )

>> Woodruff: THE OBAMA CAMPAIGN HAS HIT BACK HARD AT THE CHARGES. WHITE HOUSE SPOKESMAN JAY CARNEY:

>> FROM A POLICY STANDPOINT, LET ME SAY THAT THIS ADVERTISEMENT IS CATEGORICALLY FALSE AND IT IS BLATANTLY DISHONEST. THIS ADMINISTRATION'S POLICY WILL STRENGTHEN THE PROGRAM BY GIVING STATES THE OPPORTUNITY TO EMPLOY MORE EFFECTIVE WAYS TO HELP PEOPLE GET OFF WELFARE AND INTO A JOB.

>> Woodruff: THE 1996 LAW REPLACED A FEDERAL WELFARE ENTITLEMENT PROGRAM WITH GRANTS TO STATES. THE CENTERPIECE OF THE LAW, KNOWN AS "TEMPORARY ASSISTANCE FOR NEEDY FAMILIES"-- OR "TANF," FOR SHORT-- PUTS A TIME LIMIT ON HOW LONG FAMILIES CAN RECEIVE AID. MOST NOTABLY, IT REQUIRED MOST RECIPIENTS TO WORK OR PARTICIPATE IN JOB TRAINING PROGRAMS. CARNEY ARGUED THAT THE WAIVERS WOULD FORCE THE STATES TO MEET THE LAW'S WORK REQUIREMENTS.

>> UNDER THIS POLICY, GOVERNORS MUST COMMIT THAT THEIR PROPOSALS WILL MOVE AT LEAST 20% MORE PEOPLE-- MORE PEOPLE-- FROM WELFARE TO WORK.

>> Woodruff: FORMER PRESIDENT BILL CLINTON, WHO SIGNED THE LAW, CALLED THE ROMNEY AD "MISLEADING" AND "NOT TRUE." IN A STATEMENT RELEASED TUESDAY, HE SAID: THE LAW'S OFTEN BEEN TOUTED AS A SUCCESS AS THE NUMBER OF PEOPLE RECEIVING WELFARE HAS DECLINED OVER THE YEARS. SINCE THE START OF THE RECESSION IN 2007, REQUESTS FOR WELFARE BENEFITS HAVE LAGGED FAR BEHIND REQUESTS FOR FOOD STAMPS AND UNEMPLOYMENT BENEFITS EVEN AS THE PERCENTAGE OF AMERICANS LIVING IN POVERTY HAS INCREASED. WE TAKE A CLOSE LOOK NOW AT THE STATE OF POVERTY IN AMERICA AND DEBATE THE SUCCESS OF WELFARE REFORM WITH TWO PEOPLE WHO HAVE STUDIED THE ISSUE CLOSELY. ROBERT RECTOR IS A SENIOR FELLOW AT THE HERITAGE FOUNDATION. HE HELPED CRAFT THE 1996 WELFARE REFORM LEGISLATION. AND PETER EDELMAN IS A PROFESSOR OF LAW AT GEORGETOWN UNIVERSITY. HE RESIGNED FROM THE CLINTON ADMINISTRATION IN 1996 IN PROTEST OF THE REFORM PLAN. HE HAS A NEW BOOK OUT EXAMINING HOW TO COMBAT POVERTY IN THE U.S., TITLED "SO RICH, SO POOR." GENTLEMEN, WE THANK YOU BOTH FOR BEING WITH US.

>> THANK YOU.

>> Woodruff: PETER EDELMAN, LET ME START WITH YOU. THIS ROMNEY CAMPAIGN AD IS SAYING WHAT THE PRESIDENT HAS DONE IS GOING TO MAKE AMERICANS MORE DEPENDENT ON THE GOVERNMENT. WHAT DO YOU MAKE OF THE ROMNEY CHARGE.

>> ABSOLUTELY UNTRUE. THIS IS A GUIDANCE THAT WILL HELP PEOPLE, THAT IS DESIGNED TO MAKE IT MORE FLEXIBLE FOR THE STATES TO HELP PEOPLE GET JOBS. THAT'S WHAT TANF IS SUPPOSED TO BE ABOUT IS TO HELP PEOPLE GET JOBS. REPUBLICAN GOVERNORS ASKED FOR THE HELP. GOVERNOR ROMNEY HIMSELF ASKED FOR THE HELP TO ME IT'S WHAT'S BIGGER THAN A WHOPPER. IT'S A WHOPPER.

>> Woodruff: ROBERT RECTOR, HOW DO YOU SEE IT?

>> THESE ARE THE WORK REQUIREMENTS THAT WERE PUT IN INTO THE TANF LAW IN 1996. I WROTE MOST OF THESE REQUIREMENTS AND THESE WERE THE MOTOR THAT DROVE THAT LAW TO REDUCE POVERTY AND WELFARE DEPENDENCE BY REQUIRING WELFARE RECIPIENTS TO WORK OR PREPARE FOR WORK OR AT LEAST PART OF THEM AS A CONDITION FOR RECEIVING AID. WHAT THE OBAMA ADMINISTRATION HAS DONE IS TAKEN THESE AND SAID THEY'RE GONE, EITHER OUT OF PICTURE, THEY NO LONGER HAVE ANY MEANING IN LAW AND WE'LL REPLACE THEM WITH SOMETHING ELSE. BUT YOU SHOULD TRUST US WE'RE NOT PLANNING TO ALTER PROGRAM. THEIR ACTION WAS COMPLETELY ILLEGAL AND IT VIOLATES AND WIPES OUT THE ENTIRE CORE OF REFORM.

>> Woodruff: PETER EDELMAN, AS I UNDERSTAND IT THE WHITE HOUSE IS SAYING THAT IS NOT WHAT THEY'VE DONE. EXPLAIN WHY WHAT MR. RECTOR IS SAYING ISN'T CORRECT IF YOU BELIEVE IT'S NOT.

>> IT IS NOT CORRECT WHAT GOING ON IS PURE POLITICS. ELECTION YEAR POLITICS. THIS GUIDANCE FROM H.H.S. SAYS OVER AND OVER AGAIN THAT HIS AIM IS TO IMPROVE EMPLOYMENT OUTCOMES ON READING FROM IT FOR NEEDY FAMILIES. IT'S TO GET MORE FLEXIBILITY SO THERE THAT IT CAN MAKE IT EASIER TO GET PEOPLE OFF OF TANF INSTEAD OF HAVING WORK REQUIREMENTS IN SPECIFIC CONDITIONS... SITUATIONS WHERE THERE'S A WAIVER AND SUPERSURPRISED BY THE FEDERAL GOVERNMENT.

>> Pelley: IN OTHER WORDS GIVING... AS I UNDERSTAND IT IT'S GIVING STATES MORE FLEXIBILITY TO FIGURE OUT WAYS TO GET PEOPLE TO WORK.

>> IT'S ALLOWING STATES TO BE EXEMPTED FROM THE PARTICIPATION RATES ENTIRELY THEY SAY THEY WILL DO AWAY WITH ALL OF SECTION 407, THAT'S THE ENTIRE WORK REQUIREMENT IN THE BILL. EVERY ASPECT, EVERY CLAUSE, PHRASE IS NOW INVALID, IT NO LONGER IS BINDING.

>> THAT'S NOT TRUE.

>> IT'S ABSOLUTELY TRUE. AND THEY'RE GOING TO REPLACE IT WITH SOMETHING THEY WILL DESIGN UNILATERALLY WITH NO INPUT FROM CONGRESS AND THAT WILL BE SOMETHING THAT WILL BE FAR MORE LENIENT THAN THE EXISTING WORK. THE LEFT WING OF THE DEMOCRATIC PARTY HAS OPPOSED THIS LAW FROM THE BEGINNING. HALF THE DEMOCRATIC PARTY VOTED AGAINST IN THE '96, THEY ATTEMPTED TO REPEAL IN THE 2002, THEY WERE UNABLE. THEY'VE NOW USED A BUREAUCRATIC TACTIC TO WIPE IT OUT.

>> Woodruff: YOU WERE AMONG THOSE IN THE BEGINNING WHEN YOU RESIGNED FROM THE CLINTON ADMINISTRATION WHO BELIEVED THE LAW WENT TOO FAR, PETER EDELMAN. ON THIS PARTICULAR POINT, HOW DO YOU BELIEVE BASED ON WHAT YOU SEE THAT THE REQUIREMENT TO WORK IS STILL A PART OF IT?

>> IT DOESN'T DO ANYTHING. IT ALLOWS STATES TO COME IN WITH VERY SPECIFIC PROPOSALS TO GET TO THE DESIRED END BY A DIFFERENT ROUTE BY DOING THINGS THAT PROMISE TO BE EFFECTIVE AND INDEED THEY HAVE TO SHOW THAT THIS IS A LETTER THAT SECRETARY SEBELIUS WROTE TO CONGRESSMAN CAMP AND SENATOR HATCH THAT THEY WILL AIM TO INCREASE WORKPLACEMENT BY 20% AND THE WAIVERS WOULD BE RESCINDED. THESE ARE DEMONSTRATION LIMITED WAIVERS. IT'S NOT DESTROYING ANYTHING.

>> Woodruff: SO WE CLEARLY HAVE TWO COMPLETELY DIFFERENT PERSPECTIVES.

>> YES, EXCEPT THAT MR. EDELMAN OPPOSED THE LAW TO BEGIN WITH AND NOW HE'S HAPPY WITH THESE CHANGES BECAUSE IN FACT THEY ELIMINATE THE LAW.

>> I THINK THE ADMINISTRATION'S TRYING TO DO SOMETHING CONSTRUCTIVE HERE. THE FACT IS THAT WELFARE IS ALMOST GONE IN THIS COUNTRY. 26 STATES, FEWER THAN 20% OF CHILDREN IN POOR FAMILIES ARE RECEIVING WELFARE. IN THE STATE OF WISCONSIN THERE ARE LESS THAN 600 PEOPLE IN THE ENTIRE STATE. 4% OF POOR CHILDREN. WHAT WE SHOULD REALLY BE TALKING ABOUT IS THE FACT THAT WE HAVE BLOWN A HUGE HOLE IN THE SAFETY NET FOR LOW INCOME PEOPLE. THERE'S 6 MILLION PEOPLE THAT WHO HAVE ONLY FOOD STAMPS JUDY, AS THEIR INCOME. THAT'S WHAT WE SHOULD BE TALKING ABOUT.

>> Woodruff: LET'S BROADEN THIS OUT AND TALK ABOUT THE STATE OF POVERTY IN THE COUNTRY. WHAT ABOUT THE...

>> WE OUGHT TO TALK ABOUT THE TOTAL MEANS TESTED WELFARE SYSTEM. THERE ARE OVER 80 PROGRAMS THAT THE FEDERAL GOVERNMENT DIRECTS TO TARGETED AID TO POOR AMERICANS. 80 PROGRAMS. THIS YEAR WE SPENT $927 BILLION ON THOSE PROGRAMS. NOT INCLUDING SOCIAL SECURITY AND MEDICARE IT'S $9,000 PER RECIPIENT. OF THOSE 80 PROGRAMS, ONLY THREE HAD WORK REQUIREMENTS, NOW IT'S TWO.

>> Woodruff: WHEN YOU HEAR THOSE BIG NUMBERS, PETER, IT DOESN'T SOUND LIKE A HOLE HAS BEEN BLOWN IN THE SAFETY NET.

>> YOU HAVE TO TAKE APART ALL THE THINGS THAT MR. RECTOR HAS IN HIS LIST. THAT IS STORY HE'S BEEN TRYING TO TELL FOR A LONG TIME. THE POINT TO UNDERSTAND IS THAT THE LOWEST INCOME PEOPLE IN THIS COUNTRY HAVE INCREASED IN NUMBER. WEAVE 20 MILLION PEOPLE WHO HAVE INCOMES BELOW HALF THE POVERTY LINE AND THAT'S SIGNIFICANTLY BECAUSE MOTHERS AND CHILDREN HAVE LOST THE HELP THEY USED TO GET FROM CASH ASSISTANCE AND HAVE FOOD STAMPS. THE FACT IS WE HAVE TO... HE'S INCLUDING HEAD START, HE'S INCLUDING ALL KINDS OF FEDERAL PROGRAMS. WE NEED TO FOCUS ON THE PARTICULAR THING THAT WE'RE TRYING DO IN EACH CASE. WE WANT PEOPLE WORKING, THAT'S THE WAY WE'RE GOING TO END POVERTY. BUT WE ALSO HAVE TO HAVE A DECENT SAFETY NET AND AT THE BOTTOM WE'VE BLOWN A HUGE HOLE IN THE NET.

>> Woodruff: WHAT ABOUT THAT SPECIFIC POINT?

>> 90% OF THE SPENDING IS CASH, FOOD, HOUSING, MEDICAL CARE. IT DOESN'T INCLUDE SOCIAL SECURITY AND MEDICARE. IF YOU JUST TOOK THE CASH, FOOD, AND HOUSING ALONE, THAT'S TWICE THE AMOUNT OF MONEY NEEDED TO LEAD EVERY INDIVIDUAL ABOVE THE POVERTY LEVEL. PETER SAYS OH, THEY'RE ALL POOR. THAT'S BECAUSE NONE OF THE WELFARE SPENDING IS COUNTED AS INCOME WHEN WE CALCULATE POVERTY. WE HAVE A RECORD LEVEL OF SPENDING. IT'S SCHEDULED TO GO UP IN FUTURE YEARS. WE'RE SPENDING FIVE TIMES AS MUCH MONEY-- IF IT WAS CONVERTED IN CASH-- AS WHAT WOULD BE NEEDED TO ELIMINATE ALL POVERTY IN THE UNITED STATES. RECORD HIGH. DOESN'T SOUND LIKE AN ERODING SAFETY NET TO ME.

>> Woodruff: WE'LL GO FAMILY BY FAMILY AND SEE WHO WE'RE TALKING ABOUT AND WHETHER THEY QUALIFY FOR BENEFITS. THE FOOD STAMPS ARE... WE NEED TO COUNT THOSE IN THE WAY WSH WE... AND WE DON'T TECHNICALLY NOW. BUT THAT'S $6,000. THAT'S A THIRD OF THE POVERTY LINE FOR A FAMILY THAT HAS NO OTHER INCOME. SO WE'LL COUNT THAT. WE'RE STILL TALKING ABOUT 14 OR 15 MILLION PEOPLE WHO HAVE INCOMES BELOW HALF THE POVERTY LINE AND LET ME TELL YOU THAT IS A TERRIBLE THING.

>> Woodruff: YOU'RE SAYING THOSE PEOPLE DON'T HAVE ACCESS TO WHAT THEY NEED IN ORDER TO HAVE THE BASIC...

>> TO HAVE THE BASIC... FIRST OF ALL, WE ALWAYS WANT TO BE HELPING PEOPLE TO FIND WORK IF WORK IS AVAILABLE. AND WHAT THE ADMINISTRATION HAS DONE HERE IS IN THAT DIRECTION BUT WE ALSO NEED TO HAVE A DECENT SAFETY NET. ADDING UP A WHOLE LOT OF DIFFERENT PROGRAMS AND SAYING THEREFORE THEY MUST ALL BE MILLIONAIRES IS JUST COMPLETELY OFF THE POINT. WE NEED TO LOOK AT WHAT THE CONDITIONS ARE AND WHAT THE RELEVANT HELP IS.

>> Woodruff: YOU'RE TALKING ABOUT THE POOREST OF THE POOR.

>> I AM AND I'M ALSO TALKING ABOUT THOSE PEOPLE WHO ARE POOR AND JUST PUT IT ON THE TABLE. THE MILLIONS OF PEOPLE STRUGGLING WITH LOW-WAGE JOBS. ONE OF THE REASONS WE HAVE THE SPENDING THAT WE HAVE-- IT'S GOOD PUBLIC POLICY-- IS BECAUSE WE HAVE SO MANY PEOPLE IN LOW-WAGE JOBS AND THEREFORE WE HAVEN'T BEEN ABLE TO LOWER POVERTY AS MUCH AS WE WOULD WANT TO.

>> WHAT HAPPENED TO THE $927 BILLION? THAT COMES RIGHT OUT OF THE BUDGET OF THE UNITED STATES. IT'S HOW MUCH IS SPENT ON AID FOR LOW INCOME AND POOR PEOPLE. $927 BILLION. NOW THERE ARE A HUNDRED MILLION RECIPIENTS. A THIRD OF THE U.S. POPULATION. THAT COMES TO $9,000 PER RECIPIENT. NOW, HALF OF THAT IS MEDICAID. MEDICAL CARE. BUT EVEN IF YOU LEAVE THAT OUT, YOU'RE TALKING ABOUT TWO OR THREE TIMES THE AMOUNT OF MONEY TO COMPLETELY ELIMINATE POVERTY IN THE UNITED STATES. ALL THE STATISTICS THAT PETER IS GIVING HERE ABOUT HOW PEOPLE DON'T INCOME, IT'S BECAUSE OF THAT $927 BILLION SINCE IT ONLY COUNTS ABOUT $20 BILLION OF IT AS INCOME. THE MISSING WELFARE ATE IN OUR POVERTY STATISTICS IS GREATER THAN THE G.D.P. OF MOST NATIONS IN THE WORLD.

>> Woodruff: GENTLEMEN, WE ARE GOING TO HAVE TO LEAVE IT THERE. TWO VERY DIFFERENT PERSPECTIVE BUS WE'VE LEARNED SOMETHING FROM LISTENING TO BOTH OF YOU AND WE APPRECIATE IT. PETER EDELMAN AND ROBERT RECTOR. THANK YOU BOTH.

>> Brown: AND NEXT, WE CONTINUE OUR SERIES ON THE BIG CHANGES IN ENERGY PRODUCTION IN THE U.S. IN PREVIOUS STORIES, RAY SUAREZ HAS LOOKED AT THE IMPACT OF OIL PRODUCTION ON SOME BOOMTOWNS AND HOW A DEMAND FOR NATURAL GAS IS CHANGING THE BUSINESS FOR COAL AND ALTERNATIVE FUELS. TONIGHT, RAY VISITS UTAH. HIS FOCUS: THE USE OF PUBLIC LANDS FOR PRIVATE DEVELOPMENT.

>> Suarez: THE BANKS OF THE WHITE RIVER IN EASTERN UTAH ARE PERFECTLY QUIET IN A WAY IT'S SOMETIMES HARD TO FIND IN A WORLD OF SEVEN BILLION PEOPLE. JUST THE SOUNDS OF GENTLY FLOWING WATER, A HINT OF A BREEZE, THE OCCASIONAL BIRD. THE GORGEOUS VISTAS AND RARE SOLITUDE SIT ON PUBLIC LAND, THOUSANDS OF FEET ABOVE A BONANZA TRAPPED DEEP IN THE EARTH. FROM HIGH ABOVE, IT'S EASY TO SEE HOW THE GAS INDUSTRY HAS CHANGED THE LANDSCAPE, WITH GAS WELLS BY THE THOUSANDS ALTERING THE FRAGILE DESERT ECOSYSTEM. UTAH ENVIRONMENTALISTS SAY THE VIEW FROM THE AIR AND FROM THE CANYON FLOOR ILLUSTRATE WHY THEY WANT THESE PUBLIC LANDS PROTECTED.

>> YOU KNOW WHAT FAMILIES FIND WHEN THEY COME HERE, WHAT OUTFITTERS, WHAT AMERICANS COME FOR TO EXPERIENCE THIS PLACE? IT'S THE QUIET, IT'S THE SOLITUDE, IT'S THAT YOU DON'T HAVE THE SIGHTS AND SOUNDS OF HUMAN DEVELOPMENT AROUND YOU. IT'S A PLACE WHERE PEOPLE CAN COME AND RESTORE THEMSELVES AND

>> THERE ARE MORE CLIFFS ON THIS SIDE, WHERE THERE ARE FANTASTIC SPIRES. AND IT'S PRETTY REMARKABLE.

>> Suarez: A YEAR EARLIER, STEVEN BLOCH FROM THE SOUTHERN UTAH WILDERNESS ALLIANCE, BROUGHT GAS INDUSTRY REPRESENTATIVES FROM ANADARKO PETROLEUM CORPORATION TO THIS SAME STRETCH OF RIVER TO CONVINCE THE INDUSTRY GIANT TO CONSIDER THE IMPACT ON PRISTINE RIVER BANKS IN THEIR PENDING REQUEST TO DRILL IN THE GREATER NATURAL BUTTES REGION. ANADARKO'S EXISTING PERMITS WERE EXPIRING. THE COMPANY WANTED TO BRING OUT GAS FROM WELLS LEFT BEHIND BY OLD-FASHIONED DRILLING METHODS AND MAKE A NEW PLAN WITH THE UNITED STATES BUREAU OF LAND MANAGEMENT. THE WILDERNESS ALLIANCE ASKED ANADARKO TO DRILL FURTHER AWAY FROM THE RIVER FLOORS, TO ERECT WELLS AWAY FROM THE CANYON RIMS SO THEY CANT BE SEEN BY CANOERS AND HIKERS. THE ENERGY COMPANY ANADARKO HAD A LOT RIDING ON THE GREATER NATURAL BUTTES PROJECT, AND THE NUMBERS ARE STAGGERING: 3,700 WELLS, SIX TRILLION CUBIC FEET OF GAS RESERVES, BILLIONS TO BE PAID IN ROYALTIES TO THE STATE GOVERNMENT OF UTAH AND THE FEDERAL GOVERNMENT. THOUSANDS OF JOBS CREATED. THE ONLY QUESTION WAS: COULD THEY PULL ALL THAT GAS OUT OF THE GROUND AND MAKE PEACE WITH ENVIRONMENTALISTS AND INDIAN TRIBES TO SAVE ONE OF AMERICA'S LAST GREAT LANDSCAPES? BRAD MILLER, WHO RUNS REGULATORY AFFAIRS FOR ANADARKO, UNDERSTOOD THE IMPORTANCE OF BRINGING ENVIRONMENTAL GROUPS ON BOARD.

>> IF PEOPLE CAN COME TO AN AGREEMENT BEFORE YOU HAVE TO GO TO A REGULATORY AGENCY, TO DISCUSS THE OPPORTUNITIES FOR DEVELOPMENT, OF COURSE THAT'S GOING TO BE A PLUS FOR THE COMPANY AND FOR THE STAKEHOLDERS INVOLVED.

>> Suarez: THE SECRETARY OF THE INTERIOR OVERSEES THE BUREAU OF LAND MANAGEMENT. WITH THE PARTIES ALREADY IN AGREEMENT, THERE'S NO LITIGATION, LESS HASSLE AND MORE NATURAL GAS GOING TO MARKET RIGHT AWAY.

>> MY VIEW THAT PROTECTING THE ENVIRONMENT AND DEVELOPING OIL AND GAS ARE NOT MUTUALLY EXCLUSIVE. THOSE THAT SAY THAT ARE PROVIDING US WITH A FALSE CHOICE.

>> Suarez: SO THE WILDERNESS ALLIANCE GETS A PRISTINE RIVER VALLEY FOR ITS CONSTITUENTS AND THEY GET THE GAS UNDERNEATH IT FOR THEIR SHAREHOLDERS.

>> I THINK WHAT WE'VE SHOWN HERE AND IN A NUMBER OF OTHER PLACES IN UTAH IS THAT WE CAN FIND THAT KIND OF MIDDLE GROUND, THAT THERE ARE COMPROMISES THAT CAN BE REACHED THAT PROTECT THE SPECIAL PLACES WHILE STILL ALLOWING FOR A VIBRANT OR ROBUST LEVEL OF NATURAL GAS AND OIL DEVELOPMENT

>> IT IS A SHINING MODEL AND A SHINING EXAMPLE OF WHAT WE NEED TO TRY TO ACCOMPLISH ACROSS THE BOARD IN THE INDUSTRY. LET'S WORK COLLABORATIVELY WITH THE ENVIRONMENTAL COMMUNITY AND THE OTHER STAKEHOLDERS, THE LOCAL GOVERNMENTS, THE REGULATORS, AS WELL, TO MEET EVERYBODY'S NEEDS BECAUSE BRINGING THE IMPORTANT NATURAL GAS RESOURCE TO AMERICA IS EXTREMELY IMPORTANT.

>> MY ADVOCACY FOR THE INDUSTRY IS FOLLOW THOSE BEST PRACTICES THAT SOME COMPANIES ARE FOLLOWING AND THEREFORE WE DEVELOPED IN THOSE PLACES. WHAT WE'RE GOING TO DO IS TO MINIMIZE THE FOOTPRINT BY THE NEW TECHNOLOGIES ON HORIZON DRILLING AND PLACING MULTIPLE WELLS ON ONE PAD AND TAKING CARE OF WATER AND TAKING CARE OF EMISSIONS. THOSE ARE HUGELY WIN-WIN SOLUTIONS.

>> Suarez: MULTIPLE WELLS DRILLED FROM THE SAME SPOT MEANS FEWER ROADS, KICKING UP LESS DUST ACROSS THE WILDERNESS, FEWER TRUCK RUNS CARRYING HUNDREDS OF GALLONS OF WATER FOR HIGH PRESSURE UNDERGROUND PUMPING TO CRACK OPEN GAS DEPOSITS. NATURAL GAS ISN'T THE ONLY THING OUT HERE TO SELL. WILDERNESS RECREATION IS A BIG INDUSTRY. THE WHITE RIVER IS A POPULAR SPOT FOR CANOEING OUTFITTERS. CENTENNTIAL CANOES HAS RUN TRIPS ON THE RIVER FOR 25 YEARS.

>> YOU FEEL LIKE YOU'RE ON A WILDERNESS ADVENTURE INSTEAD OF BEING IN A ZOO WHERE THE ANIMALS ARE CAGED, OR BEING IN THE CITY OR IN AN AQUARIUM. THIS IS ALL NATURAL. IT'S REAL.

>> Suarez: ARE THE BATTLES OVER? CAN INDIAN TRIBES, ENVIRONMENTALISTS, ENERGY COMPANIES AND THE FEDERAL GOVERNMENT WALK SHOULDER-TO- SHOULDER INTO A GORGEOUS UTAH SUNSET? NOT EXACTLY.

>> THIS AREA IS AN ISLAND IN A SEA OF NATURAL GAS WELLS.

>> Suarez: FOR GUYS LIKE BLOCH, IT'S NEVER REALLY OVER. HE POINTED OUT LAND NEAR UTAH'S DESOLATION CANYON, WHERE THE BUREAU OF LAND MANAGEMENT RECENTLY APPROVED 1,298 NEW WELLS FOR THE NATURAL GAS COMPANY GASCO.

>> THE DESOLATION CANYON STRETCH OF THE GREEN RIVER IS TRULY ONE OF THE BIG GEMS OF AMERICAN PUBLIC LANDS. IT'S A REMARKABLY WILD LANDSCAPE. ONE OF THE LARGEST ROADLESS AREAS IN THE LOWER 48 AND THAT WILL BE LOST. THE LEVEL OF DEVELOPMENT WILL BE SIGNIFICANT. IT'LL SIGNIFICANTLY IMPACT THAT AREA.

>> Suarez: THE DECISION WAS A HUGE DISAPPOINTMENT FOR BLOCH, WHO SAYS ONCE THESE PLACES ARE DEVELOPED, THERE'S NO GOING BACK. THOUGH NEW LEASES REQUIRE COMPANIES TO LEAVE THE LAND THE WAY THEY FOUND IT, A DESERT IS VERY SLOW TO HEAL AND HARD TO RECLAIM.

>> Woodruff: AS RAY HAS POINTED OUT, MODERN DRILLING TECHNOLOGY IS LARGELY RESPONSIBLE FOR THE CHANGING ENERGY PICTURE IN THIS COUNTRY. THAT TECHNOLOGY INVOLVES A PROCESS KNOWN AS FRACKING. IN EARLIER REPORTS, THE NEWSHOUR HAS COVERED THE INTENSE DEBATE ABOUT FRACKING ITSELF, OTHERWISE KNOWN AS "HYDRAULIC FRACTURING." YOU CAN FIND LINKS TO OUR REPORTS, PLUS MUCH MORE INFORMATION ABOUT FRACKING, ON OUR WEB SITE.

>> Brown: AND NOW TO A RARE AND VERY INSIDE LOOK AT THE PHILOSOPHY AND PRACTICE OF A HUGELY INFLUENTIAL AND HIGHLY PROVOCATIVE SUPREME COURT JUSTICE. MARGARET WARNER TALKS WITH ANTONIN SCALIA.

>> Warner: WELL, FOR 26 YEARS ON THE SUPREME COURT JUSTICE ANTONIN SCALIA HAS LONG GROUNDED HIS OPINIONS IN THE WORDS OF THE CONSTITUTION AND THE LAW. NOW HE AND LEXICOGRAPHER BRIAN GARNER HAVE ISSUED A 567 PAGE BOOK LAYING OUT FOR OTHER JUDGES HOW AND WHY THEY SHOULD DO THE SAME. IT OUTLINES NEARLY 60 MUST-DO CANONS OF INTERPRETATION AND DISMISSES ANOTHER 13 NOTIONS AS WRONG-HEADED. THE NEW BOOK IS "READING LAW, THE INTERPRETATION OF LEGAL TEXT." AND JUSTICE SCALIA JOINS ME NOW. THANK YOU FOR BEING HERE.

>> THANK YOU. GOOD TO BE HERE.

>> Warner: YOU'RE A BUSY MAN, JUDGING 75, 80 MAJOR CASES A YEAR. WHAT DROVE YOU TO WRITE THIS... SOME WOULD CALL IT A TOME.

>> OH, WELL, IT'S NOT A TOME. WELL, I'VE BEEN VERY MUCH DEVOTED TO TEXT WALLISM AND TO THAT BRANCH OF TEX WALLISM THAT'S CALLED ORIGINALISM. THAT IS YOU NOT ONLY USE THE TEXT BUT YOU GIVE THE TEXT THE MEANING IT HAD WHEN IT WAS ADOPTED BY THE CONGRESS AND BY THE PEOPLE IF IT'S A CONSTITUTIONAL PROVISION. ALTHOUGH I'VE WRITTEN A LOT OF OPINIONS ON THE SUBJECT AND SPOKEN ON THE SUBJECT AND EVEN WRITTEN ON THE SUBJECT I'VE NEVER DONE HIT IN THE DEPTH THAT THIS BOOK DOES. THE BOOK NIECE TWO PARTS: ONE EXPRESSES, YOU KNOW, MY PHILOSOPHY IN JUDGING AND BRIAN'S PHILOSOPHY OF JUDGING AND THE SECOND PART IS A HOW TO DO IT PART. ASSUMING YOU ARE A TEXTURALIST, HOW DO YOU GO ABOUT DOING IT? THE PROCESS IS NOT NOVEL, I DIDN'T MAKE IT UP. IT SHOWS THAT IT IS HISTORICALLY WHAT AMERICAN JUDGES DID. WHAT ENGLISH JUDGES DID. AND IT'S THE OTHER MODES OF INTERPRETATION THAT ARE NOVEL AND HAVE TO JUSTIFY THEMSELVES.

>> Woodruff:.

>> Warner: YOU SEE HUNDREDS OF APPELLATE DECISIONS THAT COME BEFORE YOU. GI YOU SEE TODAY THAT THEY WOULD NEED THIS BOOK?

>> EVEN THOSE WHO WOULD BE TEXT WALL... TEXTUALISTS, NONE OF THEM IS TAUGHT IN LAW SCHOOL. THIS PARTICULAR CANON LOOKS IN THIS DIRECTION, ANOTHER CANON THEY LOOK IN THE OTHER DIRECTION AND THE TRICK FOR A JUDGE IS TO SEE WHERE THE BALANCE LIES. IT'S LIKE A MURDER MYSTERY. THERE ARE CLUES POINTING ONE WAY POINTING ANOTHER WAY, WHICH CLUES ARE THE MOST PERSUASIVE. THAT'S WHAT THE CANONS ARE ALL ABOUT.

>> Warner: WHEN YOU CALL YOURSELF A TEXTUALIST, THAT'S NOT PRESIDENT SAME THING AS THE POPULAR NOTION OR TERM THAT MANY LAY PEOPLE KNOW WHICH IS STRICT CONSTRUCTIONIST. CAN YOU EXPLAIN THAT?

>> OH, YES. I HAVE NEVER BEEN A STRICT CONSTRUCTIONIST AND ADVISE NO ONE TO BE A STRICT CONSTRUCTIONIST. STRICT CONSTRUCTIONISM GIVES A BAD NAME TO TEXT YOU WALLISM. FOR EXAMPLE, IF YOU WERE TO INTERPRET THE FIRST AMENDMENT STRICTLY YOU WOULD COME TO THE CONCLUSION THAT CONGRESS CAN SENSOR HAND-WRITTEN LETTERS BECAUSE IT SAYS CONGRESS SHALL MAKE NO LAW ABRIDGING THE FREEDOM OF SPEECH OR OF THE PRESS. A HANDWRITTEN LETTER IS NOT PRESS, NOT SPEECH, SO CONGRESS CAN... OF COURSE NOT. THAT'S NOT WHAT IT MEANS. SPEECH AND PRESS IS MEANT TO COVER THE GROUND OF EXPRESSION.

>> Warner: LET ME CITE A CRITIQUE OF YOUR FAIR READING OF THE TEXT RULE FROM A FORMER COLLEAGUE OF YOURS, RETIRED JUSTICE DAVID SOUTER AND HE SAID HE THOUGHT THE FAIR READING MODEL HAD A TENUOUS CONNECTION TO REALITY. HE SAID IT'S ONE THING TO HAVE THE CONSTITUTION SAY SENATORS MUST BE 30 YEARS OLD BUT THAT THERE ARE THESE BROAD GUARANTEES IN THE BILL OF RIGHTS LIKE FREEDOM OF SPEECH, FREEDOM OF RELIGION, EQUAL PROTECTION OF THE LAW THAT THE APPLICATION HAS TO EVOLVE OVER TIME AND THAT OTHERWISE THE CONSTITUTION CANNOT FIT THE MODERN AGE.

>> IT DOESN'T HAVE TO EVOLVE OVER TIME. IF IT WAS UP TO THE COURTS TO MAKE IT EVOLVE OVER TIME THERE WOULD NOT HAVE BEEN A PROVISION FOR AMENDMENT. IT CONTAINS A PROVISION OF AMENDMENT PRECISELY BECAUSE THE FRAMERS UNDERSTOOD THAT THEY MAY FIND SOME PROVISIONS IN THE FUTURE ARE NOT GOOD AND ADDITIONAL PROVISIONS ARE NEEDED. LOOK, WHAT THE CONSTITUTION DOES THOSE PROVISIONS THAT GUARANTEE INDIVIDUAL RIGHTS, IT TAKES CERTAIN MATTERS OUT OF THE BACKGROUND RULE OF DEMOCRACY WHICH IS THE MAJORITY RULES. NOW THERE ARE EXCEPTIONS TO THAT. AND MOST OF THEM ARE IN THE BILL OF RIGHTS. THE MAJORITY WON'T RULE ABOUT SPEECH, ABOUT RELIGION, ABOUT QUARTERING TROOPS IN HOMES AND SO FORTH. EVERY ONE OF THOSE THINGS IS TAKEN OUT OF DEMOCRATIC SELF-GOVERNMENT AND WHATEVER YOU LEAVE IT UP TO THE COURTS TO READ IN A NEW EXCEPTION YOU'RE LEAVING IT UP TO THE COURTS TO LIMIT THE SCOPE OF SELF-GOVERNMENT SO IT IS NOT THAT I THINK CONSTITUTION CANNOT BE APPLIED TO NEW PHENOMENA SUCH AS TELEVISION, SUCH AS TELEPHONES AS FAR AS FREE SPEECH IS CONCERNED. OF COURSE IT CAN. YOU HAVE TO FIGURE OUT HOW THOSE PRINCIPLES APPLY TO NEW PHENOMENA. BUT AS TO THE PHENOMENA THAT EXISTED AT THE TIME. THIS IS WHAT ORIGINALISTS WHO CONSIST OF, WITH RESPECT TO THOSE PHENOMENA IT DOESN'T CHANGE.

>> Warner: SO THAT'S WHY YOU WOULD SWAY THE DEATH PENALTY-- WHICH YOU'VE SAID OFTEN-- THAT BECAUSE IT EXISTED AT THE TIME OF THE EIGHTH AMENDMENT AGAINST CRUEL AND UNUSUAL PUNISHMENT THE FACT THEY DIDN'T MENTION IT MEANS...

>> WELL, IT ISN'T JUST THAT THEY DIDN'T MENTION IT. THEY SAID CRUEL AND UNUSUAL PUNISHMENT BUT NOBODY AT THE TIME BELIEVED THAT THAT PRO SCRIBE IT HAD DEATH PENALTY BECAUSE EVERY STATE HAD IT AND EVERY STATE CONTINUED TO HAVE IT FOR SEVERAL CENTURIES. IT MAY BE A VERY BAD IDEA, IN WHICH CASE PASS A LAW, YOU DON'T NEED THE CONSTITUTION TO GET RID OF IT.

>> Warner: YOU JUST MEAN... THE COURT WILL NEVER DECLARE IT UNCONSTITUTIONAL.

>> THAT'S RIGHT. BUT THE COURT DOESN'T HAVE TO IF THE PEOPLE DON'T PERMIT IT. PASS A LAW. AS MANY STATES HAVE DONE.

>> Warr: LET ME TAKE ANOTHER MODERN SITUATION. THERE'S BEEN A COUPLE MASS SHOOTINGS. YOU'VE TOLD CHRIS WALLACE ON FOX TELEVISION IN AN INTERVIEW RECENTLY THAT YOU THOUGHT IT WAS AN OPEN QUESTION WHETHER UNDER THE SECOND AMENDMENT YOU COULD EVEN BAN SOMEONE FROM CARRYING THEIR OWN ROCKET LAUNCHER. REALLY?

>> OH, YEAH. READ THE OPINION IN "HELLER." IT DID NOT PURPORT TO SAY EVERYBODY CAN KHARKRY WHATEVER WEAPONS HE WANTS. IT MENTIONED THERE WAS A MISDEMEANOR IN ANCIENT TIMES CALLED A FIGHTING. A FIGHTING CONSISTED OF CARRYING A FRIGHTENING WEAPON, A HEAD AX OR SOMETHING LIKE THAT TO SCARE PEOPLE. IT'S CLEAR THAT CERTAIN RESTRICTIONS ON THE BEARING OF ARMS ARE TRADITIONAL AND CAN BE ENFORCED. WHAT THEY ARE IT WILL HAVE TO BE DECIDED IN FUTURE CASES.

>> Woodruff: LET ME ASK ABOUT ONE DECISION YOU WERE IN THE MINORITY ON AND THIS WAS THE OBAMA HEALTH CARE REFORM ACT DECISION IN WHICH AS WE KNOW JUSTICE ROBERTS AGREED WITH YOU THAT THE COMMERCE CLAUSE DIDN'T APPLY BUT HE FOUND IT CONSTITUTIONAL UNDER THE GOVERNMENT'S POWER OF TAX. DO YOU THINK HE WAS FOLLOWING THE TEXT? WAS HE FOLLOWING THESE CANONS?

>> I OBVIOUSLY DIDN'T THINK SO BECAUSE I DISSENTED. I WOULDN'T HAVE DISSENTED IF I THOUGHT THAT WAS THE PROPER APPLICATION OF TEXTUALISM, DID NOT. AND THE REASONS I DO NOT ARE SET FORTH IN MY DISSENT.

>> Woodruff: WAR WAR BUT THE POWER TO TAX IS IN THE CONSTITUTION.

>> THE ISSUE IS NOT WHETHER CONGRESS HAS THE POWER TO TAX. THE ISSUE IS WHETHER IN THIS PARTICULAR LAW CONGRESS WAS EXERCISING THE POWER TO TAX IN ALL OF OUR PRIOR CASES WE SAID EVEN IF YOU CALL IT A TAX IF IT'S BEING IMPOSED FOR VIOLATION OF A LAW IT'S A PENALTY. AND THIS ONE WASN'T EVEN CALLED A TAX, IT WAS CALLED A PENALTY.

>> Warner: I HAVE TO ASK YOU ABOUT THESE REPORTS WHICH I KNOW YOU'VE DISMISSED ABOUT THERE BEING A RIFT BETWEEN CHIEF JUSTICE ROBERTS AND THE FOUR QUOTE/UNQUOTE CONSERVATIVE MEMBERS OF THE COURT. MUCH HAS BEEN MADE OF THE FACT THAT IN YOUR DISSENT YOU DID NOT ASSOCIATE YOURSELVES WITH JUSTICE ROBERTS ON THE COMMERCE CLAUSE EVEN THOUGH, ESPECIALLY YOUR OPINION, WAS VERY SIMILAR. WAS THAT THAT A SLAP AT THE CHIEF JUSTICE? WERE YOU DISTANCING YOURSELVES?

>> WE WERE DISTANCING OURSELVES FROM THE OPINION. THAT DOESN'T MEAN WE WERE ENEMIES OF THE CHIEF JUSTICE. THAT DOESN'T HAPPEN. THAT'S CHILDISH. THE.

>> Warner: YOU SAY YOU DON'T ALWAYS FOLLOW YOUR OWN RULES

>> NO, I'M SAYING I FEAR I MAY HAVE BROKEN SOME OF MY OWN RULES. (LAUGHS) I CERTAINLY DIDN'T FAIL TO FOLLOW THEM INTENTIONALLY. I WANTED TO COVER MY BACK BECAUSE PEOPLE WOULD SAY "SCALIA YOU WROTE THIS."

>> Couric: JUSTICE ANTONIN SCALIA, THANK YOU SO MUCH.

>> Woodruff: THE WOMAN AT THE CENTER OF ONE OF CHINA'S MOST POLITICALLY EXPOSEIVE TRIALS DID NOT CONTEST CHARGES OF MURDER AT A HEARING TODAY. INDEPENDENT TELEVISION NEWS FILED THIS REPORT.

>> Reporter: THE CITY WAS WET AND UNWELCOMING AND THAT'S PROBABLY THE WAY THE CHINESE COMMUNIST PARTY WANTED IT. THE COURT COMPLEX PLAYING HOST TO A ONE-DAY TRIAL, A MURDER CASE THAT THE COUNTRY'S RULERS WILL BE KEEN TO SEE THE BACK OF. STILL, IT'S NOT A STORY THAT CAN BE TUCKED AWAY AND THE STATE NEWS AGENCY WAS THERE TO RECORD IT. IN THE DARK, GU KAILAI, THE WIFE OF A FAMOUS POLITICIAN ACCUSED OF KILLING A FAMOUS BUSINESSMAN ALONG WITH HER ASSISTANT. U.K. DIPLOMATS WERE INVITED TO WATCH BUT THE VERDICT'S NOT IN DOUBT. GU KAILAI CHOSE NOT TO CONTEST THE CHARGES.

>> ( translated ): THE CRIMINAL FACTS ARE CLEAR AND THE EVIDENCE IS SOLID.

>> Reporter: GU KAILAI IS MARRIED TO BO BE XILAI, CONSIDERED TO BE A RISING POLITICAL STAR. TOGETHER THEY WERE ONE OF THE MOST POWERFUL COUPLES IN THE COUNTRY. THEY USED NEIL HAYWARD AS A PERSONAL ADVISOR UNTIL HIS DEATH. ONE OF HIS DUTIES, ORGANIZATIONING THE EDUCATION OF THE COUPLE'S SON WHO ATTENDED SEVERAL ELITE BRITISH INSTITUTIONS. BUT SHE HAD BIGGER PLANS IN MIND. THIS BUSINESSMAN SAID SHE ASKED NEIL HAYWARD AND HIMSELF TO HELP SMUGGLE MONEY OUT OF CHINA. THEIR REFUSAL INFURIATED HER.

>> SHE WAS ANGRY ABOUT IT. AND WE WERE, IN FACT, TOLD IF WE DID TO CHINA WE MIGHT NEVER GET OUT.

>> Reporter: THE COURT SAID MR. HAYWARD WAS POISONED IN A VILLA IN THE CITY OF CHONGQING. HAYWARD AND GU HAD BEEN DRINKING ALCOHOL TOGETHER WHEN HE ASKED FOR A GLASS OF WATER. IT WAS THEN SAID THE COURT THAT SHE POURED THE POISON INTO HIS MOUTH. AS FOR MOTIVE, WELL, THEY'D FALLEN OUT OVE MONEY AND HAYWARD HAD THREATENED HER CHILD THE MURKY TALE MAY HAVE REMAINED A SECRET IN CHONGQING HAS BO XILAI THE FORMER CITY GOVERNOR NOT FALLEN OUT WITH HIS POLICE CHIEF, WANGLY JUNE. IN FEBRUARY, MR. WANG RACED OUT OF THE CITY TOWARDS THE NEAREST U.S. CONSULATE WHERE HE TOLD AMERICAN OFFICIALS HE THOUGHT BO'S FAMILY WAS INVOLVED IN HAYWARD'S MURDER. IT BROUGHT AN END TO BO XILAI'S POLITICAL CAREER. THIS MAN ONCE DESTINED FOR THE TOP, HIS SUPPORTERS HAD EVEN WRITTEN SONGS ABOUT HIM. ♪ ♪

>> Reporter: BUT HIS FALL FROM FROM GRACE WOULD REVEAL THE SORT OF POLITICAL INFAGTING AND CORRUPTION THAT THE PARTY WOULD PREFER TO KEEP HIDDEN. FORMAL CHARGES ARE NOT BEEN LAID AGAINST BO XILAI AND THEARTY MAY FEEL HIS WIFE'S CONNECTION ACCOMPANIED BY A LONG JAIL TERM WILL PUT THIS EMBARRASSING AFFAIR TO REST.

>> Suarez: FINALLY TONIGHT, WOMEN FLEXING THEIR MULLS, GRABBING THE GOLD AND MUCH MORE. AS WE REPORTED EARLIER, WOMEN'S SOCCER AND BOXING WERE FRONT AND CENTER TODAY. IN FACT, FEMALE ATHLETES FROM AROUND THE WORLD HAVE BEEN IN THE SPOTLIGHT AT EVERY TURN AND EVERYBODY JUMP IN THESE GAMES WITH AMERICAN WOMEN HAVING PARTICULAR SUCCESS.

>> IT STARTED IN WEEK ONE OF THE GAMES WHEN THE U.S. WOMEN'S GYMNASTIC SQUAD WON ITS FIRST TEAM GOLD SINCE 1996. THEN 16-YEAR-OLD GABBY DOUGLAS CAPTURED THE WOMEN'S ALL AROUND. SHE REFLECTED ON HER EXPERIENCE TODAY.

>> I WAS KIND OF THE UNDERDOG THAT IT WAS A... COMING MY WAY UP TO THE TOP SO AMERICA ALWAYS WAS THE UNDERDOG SO FOR ME TO COME IN AS THAT A BOLD A PLAY, IT'S DEFINITELY A GREAT EXPERIENCE.

>> Brown: DOUGLAS' SUCCESS WAS FOLLOWED BY TEAM MATEALY RAISMAN'S PERFORMANCE IN THE FLOOR EXERCISE. 17-YEAR-OLD MISSY FRANKLIN WON FIVE MEDALS OVERALL IN THE SWIM MEET. AND IT'S NOT JUST TEENAGED GIRLS GRABBING HEADLINES.

>> IT'S OVER HERE IN LONDON. MISTY AND CARRIE. THREEPEAT.

>> YESTERDAY, MISTY MAY-TREANOR AND CARRIE WALSH, BOTH MOTHERS, WON THEIR THIRD STRAIGHT GOLD MEDAL. AND WOMEN CONTINUE TO ADD TO THE U.S. MEDAL COUNT IN TRACK AND FIELD. YESTERDAY MISSISSIPPI NATIVE BRITTNEY REESE BECAME THE FIRST AMERICAN TO WIN THE WOMEN'S LONG JUMP SINCE JACKIE JOINER KERSEY IN 1988.

>> THAT WAS A BIG JUMP!

>> Reporter: AND ALLIYSON FELIX AND CARAMELITA JETER WON. OVERALL, AMERICAN WOMEN ARE ON PACE TO WIN TWICE AS MANY GOLD MEDALS AS MEN. 40 YEARS AFTER TITLE IX BANNED GENDER DISCRIMINATION IN SCHOOL PARTS. IT'S HARDLY AN AMERICAN PHENOMENON AS WOMEN FROM AROUND THE WORLD HAVE BROKEN RECORDS AND PROVIDED DAILY THRILLS AT THE LONDON GAMES. IN FACT, THIS WAS THE FIRST OLYMPICS IN WHICH EVERY COMPETING NATION HAD FEMALE ATHLETES. ALONG WITH THE REST OF US AND NO DOUBT EVEN MORE CLOSELY, KATHERINE OLSON HAS WATCHED THESE SUCCESSES. SHE'S C.E.O. OF THE WOMEN'S SPORTS FOUNDATION A GROUP DEDICATED TO IMPROVING THE LIVES OF GIRLS AND WOMEN THROUGH SPORT IS THIS A SURPRISE? HOW BIG HAVE THESE GAMES BEEN FOR WOMEN ATHLETES?

>> I THINK THESE HAVE BEEN PHENOMENAL GAMES FOR WOMEN ATHLETES AROUND THE WORLD. THEY'VE BEEN THE GOLDEN GAMES FOR WOMEN SO THAT'S THRILLING FOR US AWL OF US THAT CARE.

>> WHAT EXPLAINS IT? FIRST START WITH THE U.S. SITUATION. WHAT'S HAPPENED IN YOUR MIND TO LEAD TO SOME SUCCESS?

>> THERE'S NO QUESTION THAT THE PASSAGE OF TITLE IX 40 YEARS AGO HAS SEEN THE FRUITION OF THAT TODAY IN WHAT WE'RE SEEING IN THE GAMES. PARTICULARLY AS YOU LOOK AT THE STRENGTH OF THE TEAM SPORTS. YOU KNOW, SOCCER WINNING TODAY, WATER POLO WINNING FOR THE FIRST TIME, WE'VE HAD SUCH SUCCESS IN THE GYMNASTICS ALL AROUND AS WELL AS OTHER TEAMS AS WELL. 40 YEARS AGO THERE WERE NOT THAT MANY WOMEN PLAYING SUPPORT. THERE WERE 1 IN 40 AND TODAY WE'VE ADVANCED TO 2-9. SO YOU'RE SEEING THE STRENGTH OF WOMEN'S AT ATHLETICS AND THE SKILLS THEY HAVE IN THESE GAMES.

>> Brown: SO YOU'VE SEEN TRAINING CHANGE OVER TIME. IS IT OPPORTUNITIES AS WELL AS THE TYPE OF TRAINING?

>> IT'S CLEARLY OPPORTUNITY. 40 YEARS AGO THERE WAS NOT THE OPPORTUNITY FOR WOMEN TO PLAY. IT HAS INCREASED OVER TIME WITH OPPORTUNITYS AT THE HIGH SCHOOL LEVEL AS WELL AS AT THE CHREJ YATS LEVEL SO DEFINITELY OPPORTUNITY. THAT MANY YEARS AGO THERE WERE NOT THAT MANY COACHES COACHING WOMEN'S TEAM AND TODAY THEY ARE SO YOU HAVE SEEN PROGRESS IN THOSE AREAS AND THAT'S COMING TO FRUITION. BUT IT'S COMING WITH THE DETERMINATION OF THESE GIRLS. TAKE ALYCE SON FELIX. FOUR YEARS AGO SHE WON A SILVER MEDAL AND THAT WASN'T GOOD ENOUGH FOR HER EVEN THOUGH A SILVER MEDAL IS FANTASTIC. AND IT'S THE DETERMINATION IN THESE YOUNG WOMEN. SHE CHANGED HER TRAINING ROUTINE SHE HIRED WHAT SHE FELT WAS A GREAT COACH AND THEN SHE WINS GOLD YESTERDAY AND THAT'S... THAT'S HER DETERMINATION. THAT'S HER DESIRE TO BE THE BEST IN THE WORLD EVEN THOUGH SHE ALREADY WON SILVER TWICE. SO YOU'RE SEEING THAT AS WELL.

>> Brown: I ASSUME ALONG WITH THE DETERMINATION OF THE ATHLETES IS A PSYCHOLOGICAL SHIFT IN THE COUNTRY WHERE THIS IS NORMAL AND QUITE EXPECTED FOR YOUNG GIRLS TO START PLAYING RIGHT AWAY.

>> ABSOLUTELY, AND THAT'S WHAT'S SO REWARDING. MANY YEARS AGO THE PERCEPTION WAS THAT GIRLS DIDN'T ENJOY SPORTS, THEY SHOULDN'T BE PLAYING SPORTS, IT WASN'T SAFE, IT'S ALMOST LAUGHABLE TO THINK ABOUT THAT TODAY WHEN YOU LOOK AT THE NEW DEFINITION OF BEAUTY ARE PORTRAYING THEIR STRONG, THEY'RE FIERCE COMPETITORS, THEY WANT TO WIN, THEY WON'T GIVE UP UNTIL THEY WIN AND THAT'S THE NEW BEAUTY.

>> IT'S FUNNY YOU USE THE WORD "BEAUTY." SALLY JENKINS IN THE "WASHINGTON POST," A SPORTS COLUMNIST IN, SHE WROTE ABOUT THIS TODAY AND SHE WAS TALKING ABOUT THE TWO WINNERSçóÑiw<Cñó IN BEACH VOLLED HOW EARLY ON WHEN THEY BEGAN. THERE WAS FOCUS ON WHAT THEY WORE. IT WAS ON THE BIKINIS BUT SHE SAID YOU DON'T HEAR THAT MUCH ABOUT THAT ANYMORE.

>> WHICH IS TERRIFIC. AND WE SHOULDN'T BE ABOUT THAT. WITH CARRIE AND MISTY HOW CAN YOU COMMENT ON ANYTHING BUT THEIR SKILL AND THE FACT THAT THEY'VE DOMINATED THAT SPORT? THREE GOLD MEDALS IN A ROW. IT'S FANTASTIC AND IT SPEAKS TO THEIR SKILL AND THAT'S WHAT WE SHOULD BE TALKING ABOUT. WHEN WE'RE TALKING ABOUT THE TWO OF THEM, AN ALL-AMERICAN FINAL AND TO HAVE THEM WIN IS REALLY TERRIFIC. THEY'RE NOT THE ONLY ONES THAT HAVE COME BACK FOR A THREEPEAT. THE U.S. SOCCER TEAM WON TODAY. THERE'S A NUMBER OF PEOPLE, BOTH OF THE HEATHERS HAVE BEEN... HEATHER O'RILEY, THIS IS HER THIRD GOLD MEDAL. THE THIRD GOLD MEDAL FOR THE TEAM. I ANTICIPATE WE'LL SEE THE OOSH ANOTHER GOLD MEDAL FOR THE WIPL BASKETBALL TEAM. THE I DON'T WANT TO GET AHEAD OF MYSELF BUT... I DON'T WANT TO DO THAT BUT THEY HAVE BEEN PLAYING EXCEPTIONALLY WELL.

>> Brown: WHAT ABOUT THE REST OF THE WORLD? WE'RE SEEING SUCCESS BY AMERICAN WOMEN BUT WHERE DO YOU SEE BIG GAINS AND WHERE DO YOU SEE BARRIERS?

>> A B GAIN, WE HAVE TO FIRST OF ALL GIVE CREDIT TO TEAM G. B. IT'S BEEN THRILLING. JESSICA ENNIS, HER VICTORY, SHE'S CAPTURED THE HEART OF THAT NATION. IF YOU LOOK IN THE STANDS YOU SEE THE CITIZENS OF GREAT BRITAIN AND LONDON DOING THE WAVE AND HIGH FIVING. THEY'RE ACTING LIKE AMERICANS. IT'S REALLY BROUGHT THAT COUNTRY TO LIFE. AS YOU LOOK AROUND THE WORLD THERE ARE COUNTRIES THAT HAVE HAD WOMEN ON THE TEAM FOR A FIRST TIME. D IS. THERE'S A LONG WAY TO GO. IT'S TERRIFIC THOSE WOMEN ARE IN THE GAMES. THEY CAN'T TRAIN IN THEIR COUNTRY SO THERE'S A LONG WAY TO GO WITH THAT. THERE'S WORK THAT NEEDS TO BE DONE THERE. THERE'S ALSO WORK THAT NEEDS TO BE DONE IN OUR COUNTRY. I'M ESPECIALLY DPLIGTED TO SEE THE NUMBER OF AFRICAN AMERICAN WINNERS THIS YEAR IF YOU THINK BACK TO THE 1948 OLYMPICS IN LONDON, THE LAST TIME LONDON HOSTED THE GAMES ALICE COACHMAN WAS THE FIRST AFRICAN AMERICAN WOMAN TO WIN GOLD AND NOW THERE'S SO MANY IT'S HARD TO NAME BETWEEN ALLISSYON, BRITTNEY GABBY, SONIA RICHARDS ROSS, VENUS AND SERENA, THESE ATHLETES ARE ROLE MODELS FOR THAT COMMUNITY. A GIRL OF COLOR IS THE MOST LIKELY TO BE OVERWEIGHT, THE LEAST LIKELY TO BE ACTIVE AND THEY'RE SAYING HEY, COME ON, LET US BE ROLE MODELS FOR YOU. IT GIVES ME HOPE MANY GIRLS WILL ASPIRE TO... TO GO OUT THERE, BE ACTIVE AND PARTICIPATE IN SPORTS.

>> Brown: WE HAVE TO LEAVE IT THERE. KATHRYN OLSON OF THE WOMEN'S SPORTS FOUNDATION. THANK YOU VERY MUCH.

>> Woodruff: AGAIN, THE MAJOR DEVELOPMENTS OF THE DAY: OVERALL FORECLOSURE FILINGS FELL NATIONWIDE IN JULY, BUT A SPIKE IN NEW CASES INDICATED THE HOUSING RECOVERY REMAINS FRAGILE; SEVERE DROUGHT SPREAD ACROSS EVEN MORE OF THE U.S. BREADBASKET IN THE LATEST WEEKLY REPORT ON CONDITIONS; AND SYRIAN TROOPS AND REBELS HAMMERED AWAY AT EACH OTHER IN THE BATTLE TO CONTROL THE KEY CITY OF ALEPPO. KWAME HOLMAN HAS MORE ABOUT THE NEWSHOUR ONLINE.

>> Reporter: ON OUR "MAKING SENSE" PAGE, PAUL SOLMAN EXPLORES HOW LONG IT MIGHT TAKE FOR THE U.S. TO HIT THE $10 TRILLION DEFICIT MARK, AND ASKS, "HOW MUCH DOES IT MATTER?" THAT AND MORE IS ON OUR WEB SITE, newshour.pbs.org. JEFF?

>> Brown: AND THAT'S THE NEWSHOUR FOR TONIGHT. ON FRIDAY, GWEN IFILL HAS A LOOK AT FIRST LADY MICHELE OBAMA'S UNIQUE FAMILY HISTORY WITH AUTHOR RACHEL SWARNS. I'M JEFFREY BROWN.

>> Woodruff: AND I'M JUDY WOODRUFF. WE'LL SEE YOU ONLINE AND AGAIN HERE TOMORROW EVENING WITH RUTH MARCUS AND MICHAEL GERSON, AMONG OTHERS. THANK YOU AND GOOD NIGHT. MAJOR FUNDING FOR THE PBS NEWSHOUR HAS BEEN PROVIDED BY: AND WITH THE ONGOING SUPPORT OF THESE INSTITUTIONS AND FOUNDATIONS. AND... THIS PROGRAM WAS MADE POSSIBLE BY THE CORPORATION FOR PUBLIC BROADCASTING. AND BY CONTRIBUTIONS TO YOUR PBS STATION FROM VIEWERS LIKE YOU. THANK YOU. Captioning sponsored by MacNEIL/LEHRER PRODUCTIONS Captioned by Media Access Group at WGBH access.wgbh.org

>> THIS IS N.B.R.

>> Susie: GOOD EVENING. I'M SUSIE GHARIB. THE HIGH-END CONSUMER IS BACK, BUT THE MIDDLE GUY CONTINUES TO STRUGGLE, THE LATEST RETAIL EARNINGS AND OUTLOOK.

>> Tom: I'M TOM HUDSON. STOCKS TRADE FLAT ON LACKLUSTER VOLUME, WE LOOK AT WHAT IT'LL TAKE TO GET INDIVIDUAL INVESTORS BACK ON WALL STREET AGAIN.

>> Susie: AND WITH THE HOTTEST JULY ON RECORD IN THE UNITED STATE, THE MIDWESTERN DROUGHT DRIVES A JUMP IN GLOBAL FOOD PRICES.

>> Tom: THAT AND MORE TONIGHT ON "N.B.R."! OUR FIRST STOP, THE CONSUMER. STILL SPENDING ON LUXURY GOODS. NORDSTROM TOPPING WALL STREET FORECAST, FOR INSTANCE. LATE TODAY THE HIGH END DEPARTMENT STORE REPORTED EARNINGS OF 75 SEBTS PER SHARE, A PENNY AHEAD OF ESTIMATES SDP. NORDSTROM IS SPEEDING UP THE EXPANSION OF OFF PRICE STORES. IT'S JUST MORE EVIDENCE THAT PRICE IS PARAMOUNT FOR CONSUMERS. RAMIREZ.

>> NEW YORK CITY IS CONSIDERED THE FASHION CAPITAL OF THE WORLD WHERE YOU FIND EVERYTHING FROM LUXURY RETAILERS TO SDOUNLT RETAILERS. JANING US TO MICHAEL APPEL. MICHAEL, LET'S TAKE A DRIVE AROUND TOWN AND GET YOUR THOUGHTS ON THE RETAIL INDUSTRY.

>> TERRIFIC. LET'S GO.

>> MICHAEL, UF'VE GOTEN A BARRAGE OF READINGS FR, RALPH