captioning sponsored by macneil/lehrer productions >> woodruff: president obama said there was "no excuse" for the problems plaguing the new health care web site, but defended the broader law. good evening. i'm judy woodruff. >> ifill: and i'm gwen ifill. also ahead this monday, a report from detroit on the battle back from bankruptcy, an effort to breathe life into blighted neighborhoods and struggling businesses. we're going to to be the neighborhood and be positive. >> on in china with pollutions levels 40 times

the acceptable limit shut down a city of 11 million people. >> people walked out of their houses today, and thought that there was a blizzard. but in fact it wasn't snowinging this is how intense the air pollution was. >> woodruff: those are just some of the stories we're covering on tonight's pbs newshour. >> major funding for the pbs newshour has been provided by: >> and by the alfred p. sloan foundation. supporting science, technology, and improved economic performance and financial literacy in the 21st century. >> 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.

>> woodruff: our lead story tonight, the president today joined the wave of criticism that has greeted the rocky rollout of online efforts to get people to sign up for health insurance. he conceded the federal web site central to the process has failed to deliver. from the outset health care.gov has been plagued with problems within hour after hour after hour of just trying to find the answer to the question where am i going to have my insurance and what's it going to cost. >> for the first week i tried ii, three different days to try to just log on. >> at fordable care act-- . >> reporter: but today in the white house rose garden president obama added his own criticism to the mix, saying there is no excuse for what he calls kinks it in the system. >> there's no sugar-coating it. the web site has been too slow. people have been getting stuck during the application process. and i think it's fair to say

that nobody's more frustrated by that than i am ides health care.gov opened for business on october 1st. the president said today there have been nearly 20 million visits since then. and according to administration officials, fearly half a million people have applied for insurance there and on state-run web sites. they won't say how many have actually enrolled. the president offer those explanation today for why the rollout has been so chaotic. but he emphasized there are other ways to enroll. >> nobody's madder than me about the fact that the web site isn't working as well as it should, which means it's going to get fixed. (applause) and in the meantime, you can bypass the web site and apply by phone or in person. so don't let problems with the web site deter you from signing up or signing your family up. or showing your friends how to sign up. because it is worth it.

it will save you money. >> ifill: a national survey by the pew research center found 46% of americans don't think the health care exchanges are working compared to 29% who think they are. the web site troubles have also fueled new attacks by republicans. senator john mccain appeared sunday on cnn. >> it's been a fee as co. send air force out to silicon valley, load up with smart people, bring it back to washington and fix this provnlt it's ridiculous and everybody knows that. >> ifill: the president said today his republican critics are rooting for failure. but that consultants and contractors have been called in to fix the web problems. we'll have more on >> ifill: we'll have more on this story after the news summary. the supreme court will consider how states decide who is mentally fit to face the death

penalty. the justices accepted the case of a condemned killer in florida. his i.q. is just over the level classified as mentally disabled under state law. in 2002, the court barred executions of mentally disabled defendants, but left it to the states to judge who meets the criteria. new jersey today officially joined the ranks of states where gay marriage is legal. same-sex weddings began under a state judge's ruling issued last month. and governor chris christie decided to drop further legal challenges. more on this, later in the program. the san francisco region began the week hobbled by a transit strike that shut down the nation's fifth largest commuter rail system. we have a report narrated by newshour correspondent kwame holman. . >> reporter: headaches and delays greeted commuters this morning with the bay area rapid transit rail system closed until further notice. >> so i'm trying out things i haven't tried before. i'll see what happens but i'll try to work from home the rest of the week if this continues. more than 2,000 unionize odd employees walked off the job early friday over pay raises

and workplace rules. contract talks made little progress over the weekend leaving bart's average daily ridership of 400,000 to find other ways to work. heavy traffic clogged toll plazas and snarled major roadways and commuters formed long lines for ferries, charter buses and even carpools. >> i'm sitting here as opposed to going to bart and it's probably going to be another hour an 30 minutes before i get to my office which means less productivity for me and everyone there with me. i wish i had the benefits these people getment i'm all for labor but these guys are living in the '90s. >> strikers including mechanic gregory gray said they had no choice. >> i don't want to be out here on the line. i would just rather be at work. i'm to the getting paid today. i mean i work to get a paycheck. so and i know it's really bad for commuters. >> reporter: amid the strikes two transit employees were killed over ot weekend by an out of service train. the national transportation safety board has opened an investigation. it was unclear whether the

work stoppage or bart's use of nonstriking workers played a role. >> ifill: later the transit agency and unions said they resume talks on ending the strike. the french government called on the american ambassador today to explain the latest revelation involving the u.s. national security agency. the french newspaper "le monde" said the n.s.a. collected more than 70 million french phone records in a 30-day period. he acknowledged there are legitimate questions to address. in iraq, seven policemen were killed today, when gunmen and a suicide bomber attacked a police headquarters in fallujah, a former al-qaeda stronghold. the assault followed a bloody weekend. on sunday, a suicide bomber killed at least 38 people outside a cafe in a mainly shiite district of baghdad. nearly 400 iraqis have died in the violence this month alone. fire crews in australia are still struggling against scores of wildfires in the face of hot,

windy weather. the huge blazes have already destroyed more than 200 homes outside sydney, and killed at least one person. we have a report narrated by john sparks of independent television news. in a. >> from a distance giant plums of smoke filled the sky. up close, however, it looked like an inferno. balls of fire moving quickly through the bush land of new south wales. and the people who run this state are worried. they've called it an unparalleled emergency. with the suburbs of the country's largest city, sydney, now under threat. >> we have looked at best case, worst case, and in between scenarios. and no matter which scenario you look at, there is going to be a significant amount of fire activity. >> reporter: bush fires are common in australia. but the winter months

brought little rain and the fires have come early. fanned by strong winds, they've raced through communities of sydney's outskirts. >> a state of emergency has been declared giving officials the power to order evacuations. and with temperatures and wind speeds expected to rise, they will probably have to use it. residents in the blue mountains to the west of sydney are particularly vulnerable. >> so many people praying for us. anything can happen. i'm hoping that it will be all right. >> reporter: for many it's too late. their homes have been reduced to ash. but the fires are random. other properties are left unscathed. these pictures taken by a firefighter on his way home. the dangers are immense. if multiple bush fires merge, the authorities may have what is known as a megafire

to deal with. >> reporter: people >> ifill: people in harbin, china, faced a blanket of toxic smog today that set new records. authorities shut down schools and grounded flights, after air pollution levels soared to 40 times the international standard. the region has entered its "high-smog season," as more coal is being burned for heating. we'll have more on this, later in the program. evacuees who lived near japan's fukushima nuclear plant could wait three more years before they go home. the environment ministry said today they're delaying cleanup for six of the 11 affected villages, as they determine where to store and dispose of contaminated waste. an earthquake and tsunami triggered a meltdown of three reactors at the plant in march 2011. wall street had a quiet day to begin the week. the dow jones industrial average lost seven points to close at 15,392. the nasdaq rose five points to close at 3920. also ahead on the newshour, how

the stumbling rollout of healthcare.gov could slow the enactment of the affordable care act; an update on gay marriage in the states; bringing back detroit from bankruptcy; j.p. morgan's potential $13 billion settlement with the government; former senate majority leader trent lott on the future of the republican party; and a super smog shuts down a major chinese city. >> ifill: now, the rocky start of the new health care exchanges. internet experts have suggested it may take weeks to fully fix the federally run web site so that it runs smoothly for consumers as deadlines approach this winter. we look at what's at risk, politically and pragmatically. sherry glied was an assistant secretary in the department of health and human services for the obama administration. she left last year, and is now the dean of the new york university wagner graduate school of public service.

and gail wilensky, a health economist at project hope. she's served on numerous government advisory boards and oversaw medicare and medicaid for president george h.w. bush. welcome to you both, to the newshour, sherry glied to you first, you were in the government at the department up until a year ago, how serious do you understand this problem to be? >> well, i haven't heard directly from anyone in the department it seems that the big problems have to do with the initial interface with the web site and that doesn't really seem to be going very well yet. hopefully it will be fixed soon. but at this point there's a real problem in terms of just accessing the coverage options. and gail wilensky, what is your sense of how serious this is? >> it very serious. many of us thought the rollout might be a bit rocky and bumpy. i don't think anyone anticipated the kind of difficulties and frustrations that people are reporting. the administration has a couple of weeks to get this fixed. but it needs to do it in a

hurry. otherwise the question of whether people will be able to enroll before january 1st starts becomes a serious issue. and of course the question of when they'll be liable if they don't have coverage also is going to get raised. >> woodruff: well, sherry glied, let's talk about that. what are the risk, first of all politically, if this isn't fixed quickly? >> well, i guess, you know, you really have to separate the short term and long-term problems. the short-term problems over the next month or so there will be a lot of oversight t will be augustly and unpleasant. a lot of people talking about what a disaster it is. the real question is whether the web site can get going and enrollment can really pick up around december. because that's when people need to enroll in order to be able to get coverage beginning in january. and the period between december and march, which is when the mandate kicks in is really the period when we really expect people to get enrolling in coverage. so that's what is really critical. as long as the problems are

fixed before say mid-december, things should be fine, except for the short term unpleasantness, political unpleasantness. the problem is if it goes on after that deadlines will start to be missed. it will be harder to get the kind of enrollment in the first part of the program that the administration has been hoping for. >> woodruff: gail wilensky do you see the time line as sherry glied just described it, and how does the political reaction play into this? >> i think the time line is a little shorter. what i have been hearing and talking to people is the administration really needs to have this problem resolved by mid-november. otherwise one of the problems that people have been worrying about, that it will be the predictably high users that will do whatever it takes to enroll. but getting the young immortals, people who are likely to be low-users, they're going get discouraged easily because they weren't really sure they wanted insurance in many cases in the first place. they're the ones that you worry about.

if they don't pursue getting insurance, the premiums that will result will be unsustainable. that's the biggest risk in this first year that only the high users will go through whatever it takes to get the insurance that they have wanted or have had in these high risk pools. the politics are to raise questions about will the administration be forthcoming. thus far stonewall being what the problem is, and how many people have enrolled isn't helping restore the confidence that the administration understands it has to get it fixed. and will be forthright with what they know. the president, i know, attempted to correct some of that today by his very strong statements. my advice is share the information on enrollment, biweekly as you have them. they don't have to be real high now. they have to start getting high by the time december rolls around. >> woodruff: an sherry glied,

i mean how-- how much more transparent can the administration be and should they be? >> well, i'm hoping that they'll start to put enrollment figures out in early november. i guess it's really important to know that the young immortals, the people we expect will get coverage just because of the mandate, the experience we find in massachusetts is those people are the very last ones to sign. they are going to be the ones signing up in february and march. so in that sense i think they have a little bit more time on the clock. and we will be really interested in looking at the enrollment figures as january, february and march come around. you expect to see the early enrollments to be mostly people who are really sick and are transitioning would the exchanges. >> woodruff: staying with you, sherry glied, what about the point that gail wilensky made that it's really a november deadline, that if things don't start getting better by november it's going to create bigger problems down the road? >> well, it would certainly be nice if things started getting better in november. but i do think it's really important to look at the experience of other programs,

prior experience with doing things like this, is that the people you really worry about who are those young, healthy people, they're not the ones who are enrolling in november for something they don't have to buy until march. so you know, i think what we're going to be seeing in the early days is really people who are very anxious about getting coverage, who are signing up. and that's kind of consistent with what we have already seen. if you are looking at the news reports in a couple of weeks before the rollout happened, what everyones with worried about is that no one would hit the exchanges. all the stories was nobody knew anything about this and no one was going to sign. instead there has been this enormous rush of people and i think they have mostly been, a lot of them are curious, you know, curiosity, people without are just curious about how the whole thing is working and many of the others are the sicker people trying to get coverage to replace coverage they already have. >> woodruff: gate wilensky are there other things the administration can do. clearly they've got people working nonstop on this, we are fold the contractors, the people working on the are now going to testify on the hill before committees looking into this later this eck would. but what else, i mean are we

potentially talking about delaying the deadline? >> well, that's certainly going to be regarded as a last resort by the administration. the administration made a policy call early on that i think has exacerbated the problem. they didn't want to have people do what is called anonymously browse. that is look at the different option os before they actually enroll and sign up. and the concern was that if they saw the premium price without the subsidy that they could be eligible to receive, that might scare some people off. but what it meant is that many people who right now are just looking to see what the options are, have to go through that very arduous enrollment process before they can get that information. now i've been told multiple times that there is a different way that you can do it now. but when i personally have gone on the web site to see whether i can find that way of looking at the plan choices and not having to

enroll t takes me about six screens and then i get dumped back into the enroll now request. so if it is on, it's not obvious to somebody who is reasonably proficient in getting around the web site. >> woodruff: well, a work in progress in more ways than one, gail wilensky, sherry glied, we thank you both. >> thank you. >> thank you. >> ifill: new jersey became the latest state to legalize gay marriage today, but it's not the only state taking matrimonial matters into its own hands. ray suarez has that. > suarez: same-sex couples married by newark mayor and senator-elect cory booker in the garden state were met with some welcome news as they exchanged nuptuals. governor chris christie's move dropping the appeal makes new jersey the 14th state to allow gay marriage, along with the district of columbia. 35 states have laws or

constitutional amendments in place to restrict same-sex marriage. joining me now to outline what's happening is david crary. he reports on social issues and policies as a national writer at the associated press. chris christie said he was going to pursue this a people. he said he preferred that either the legislature or the voters of new jersey change the law. did it surprise people that he dropped his opposition? >> i think it was only surprising, ray, the speed with which he did it. it was clear that he decided it this was going to be a losing effort on his part. the supreme court of new jersey was pretty clear how it would have ruled eventually. so very quickly he said i'm going to drop the fight. we'll have same-sex marriage here in new jersey. >> suarez: the attention was on new jersey today but is this really a struggle that's now in multiple venues on multiple fronts where is the action? >> it's all over the place, ray. i think there are at least 13 other states that have

active pending lawsuits over same sex marriage now. some could be resolved fairly quickly. some are likely to drag on into next year. there's also action in some state legislatures, illinois in particular. there's also efforts to get this issue on to the ballot in 2014, in states like oregon. so it's a multifaceted, multistate thing that could play out very quickly within a year or two. >> suarez: but looking at the calendar, who are the next batters up? where is action really very close to having to be taken? >> new mexico, ray, there's going to be a hearing in the state supreme court this week unless they change the plans in new mexico's a fascinating statement because it's the only state with no law specifically legalizing same saks marriage or outlawing it. it's kind of a gray area. eight of the 33 counties have started issuing same sex marriage licenses. the others have not. the state supreme court is being asked to try to sort

out that very fascinating situation. and that could start this week. >> suarez: new mexico is one of only, one of a handful of states where county officials have taken matters into their own hands, citing the supreme court decisions of the last term as their basis for doing so. in defines of their own state laws has this changed the battle? >> well, that is happened in pennsylvania, in north carolina, in new mexico, what it's doing is kind of i think against speeding up the process. it's forcing the state supreme court to realize they're going to have to step in sooner rather than later and kind of reconcile this inconsistency from county to county. so it's a very interesting situation, these acts of local defines that are going to speed up the statewide process. >> suarez: are they even expanding the map, taking the battle to places that are really not expected as hot beds of this social question? i read that a lawsuit is

moving ahead in tennessee. >> tennessee, filed just today. arkansas has a lawsuit. there are two rival lawsuits seeking marriage rights in virginia. so it is absolutely expanding the map. i think the goal is to get as many states as possible into this marriage camp and then go back to the u.s. supreme court within a year, two years, and say look, this is now the norm in the u.s. and it's not a few liberal states and have the supreme court reconsider the issue. that's going to happen, i think, a question of how soon. >> suarez: with new jersey joining the list becomes one-third of all american citizens live in a state where gay marriage is allowed. is it pretty much going to reach a sort of equilibrium point where those states with constitutional amendments or specific bans pretty much stay in that column, age the ones that seem open to it or have it in process pretty much stay

in that column? are we reaching stasis in this battle? >> yeah, i think we are. i think, for example, illinois is likely to join the same-sex marriage ranks as a populous state, hawaii, oregon are likely. so we could get close to that sort of half the country this, half the country that. and at that point there is going to be pressure on the supreme court, u.s. supreme court to say to itself as they did with interracial marriage, we can't really have a country permanently with two systems of marriage. so at some point there is going to be pressure on the high court to figure that they are going to have to have a uniform marriage law for this divided country. >> suarez: quickly, why can't we have two marriage laws, two marriage regimes across crit? is that not sustainable over time? >> i think a lot of legal experts would say it's not sustainable over time. we're a very mobile country. people move from one state to the other, companies have

branch offices in different states. so we're making due with that split system now. i think long-term i don't think it would last in per pe future. >> suarez: david cary from the associated press, thanks for joining us. >> thank you, ray. >> woodruff: in july, detroit became the largest american city ever to file for bankruptcy. that process continues to unfold, and much of the news since has been grim. but as jeffrey brown found recently, there's another side to the story of this troubled city. >> developers, lenders understand now that there is a lot of folks that are moving back here and want to move back. >> seeing this place transform, even though we have so much further to go. >> i think we're sort of exercising new muscles as a community. and i think that's healthy. >> the community, the place these people are speak of,

detroit. cities that's been the poster child for all that can go wrong in urban america. industrial decline, mismanagement, corruption, the list goes on. but there are also signs of life here. new energy, new idea, new money, new possibility of what detroit might, emphasize might, become. so what would we have seen here say ten years ago. >> well, you would have seen a whole block that was vacant. would you have seen, for instance, at this corner a one-story concrete building that had sort of a novelty store. would you have seen a va kansi here that was last use as a porno theatre. >> a porno theatre, that was the business around here. >> yeah, that was the business. >> reporter: sue mosey doesn't like the title but she's often called the mayor of midtown. an area just north of downtown detroit that's long been down, you can still see it, but is now attracting young artists and professionals and sprouting the kind of shops and businesses, that will

attract even more. >> it's a good descripter for detroit. >> mosey nonprofit neighborhood organization midtown detroit helps businesses get loans, brings in developers to rehab old buildings and assists would-be renters and buyers with down payments. remember, this is a cities that's lost two-thirds of its population since its peak in 1950. but these days in this area, there's actually a wait list for new units. >> this is originally a 1924 historic building that was vacant for at least a decade or so. we're going to be spending about $30 million to renovate it for 129 units of new housing. >> reporter: but this goes to your biggest obstacle, or barrier still, right s housing. >> right. we can't produce it fast enough. there's a lot more people who want to live here right now than we have current housing available. rts some 12 miles away in this geographically huge city, in the brightmore neighborhood the detroit we've all become more familiar with. block after block of

abandoned, burned out, boarded up houses. but here too there are signs of life. >> do you let's rally go door-to-door to try to get people involved? what do dow? >> i lot of times, yes. we do have to just knock on somebody's door. >> reporter: kirk maze heads the britemore alliance, a coalition of more than 50 nonprofit groups trying to revitalize one of the city's most blighted areas. the mantra here, restore the more. >> the naub hood he is a poverty stricten community. you have emergency food challenges, where hunger is an issue. low education outcomes for our children. but we do believe that any of these challenges, all of these challenges can be overcome by the right time, attention and focus of the people who are here. so our biggest struggle is getting people involved, getting people to believe and to grab on that hope that things can change.

>> reporter: the first step, tearing down and cleaning up the abandoned mess. we watched as one group motor city blight busted removed the last of five homes on a single brightmore block. one growing alternative, community gardens. the food and simple quality of life. even if there's still tiny islands in a sea of deslation. >> so we're standing in a nice garden. but behind you is a boarded up house. across the way is a burned out building. what good is a garden. >> a garden does more than you would think. inspiring people that their hope is not seeded in the wrong place. we will see people putting that kind of work in and it resulting into something that's beautiful to everybody can share. it does start to make those little differences in people's lives, that you will see, you know, yeah, these are shuttered, boarded up homes but everybody's

grass is cut. >> uh-huh. >> everybody's trying to do their best to maintain the progress that we made and that's engagement. >> reporter: hugely important to any resurgence, of course, and now a major to cuffs the alliance, creating new jobs in commerce. >> what issues are you having right now to ramp up the capacity. >> reporter: earlier this year techtown, a business incubator located downtown opened an office in brightmore to offer counselling for mom and pop businesses like sweet potato sensations. >> 31-year-old espe thomas was there for help on how to expand her family's bakery, making all things sweet potato. >> we're here and we're to the going anywhere. and we're making beautiful things happen. we've going to pump these sweet potatoes out like crazy and we're going to just make this money. we're going to add love to the neighborhood. we're going to be-- going to be positive no matter what. >> reporter: and then there's downtown. the scale is larger, the pace of change quicker. >> we bought the first

national building. we bought the chase building, the 1001, the dime building, all the buildings with lightses on them. >> matt cullen, a former auto executive is president of rock ventures which manages the real estate and investments of quicken loans. the nation's largest mortgage lenders. >> three years ago qing's billionaire owner dan gilbert moved his headquarters from the suburbs into the heart of the city. even giving workers subsidies to live downtown. the company also went on a buying spree spending more than a billion dollars for 40 properties purchased at rock bottom prices. bringing new energy, yes, but also raising concerns about turning defroit into a new kind of company town. >> is it conceivable that you're doing so much here, you could almost end up as the sort of monopoly in downtown detroit. >> well, we could. but i done think that's going to happen. we are buying buildings that sat empty for 20, 25 years.

and now there are buildings that are up for auction as recently as the last couple of weeks where there are any number of bidders, from outside of the area, and outside even the country have come in and have invested. our, our mantra has been come on in, the water's fine. this is an opportunity. we like to say we can do good and do well. >> part of that doing good is improve og the downtown physical space. rehabbing buildings, yes, but also hiring private street cleaners, adding a-- ping-pong tables and basketball court where people can gather. even dressing up still empty storefront windows. other high-tech companies have taken notice. twitter opened a small office and google will soon follow. and rock ventures has invested $17 million to help a number of smaller start-ups. >> we need that raw material of smart people that want to be here and to help-- without them we can't be successful. we have found that people

really are just passionate and motivated about coming to detroit and getting engaged. >> reporter: grand goals, indeed. but so many problems, so many questions that remain. including whether parts of detroit, downtown and the more impoverished neighborhoods will grow together or further apart. and we asked how long will it take to create this new detroit? >> i think it's going to take ten years, at least. >> i would say a good ten years. >> about ten years. people will be writing a completely different story about detroit. >> reporter: in other words, hope, energy, potential. but years of work to come. >> ifill: now, we look at the government's approach toward accountability in the wake of the financial crisis. jpmorgan chase, the nation's largest bank, is on the verge of a reported $13 billion settlement with the obama administration to avoid civil charges over the sale of troubled mortgage securities.

it would be a record penalty and by far the biggest punishment yet for players involved in the 2008 meltdown. still unclear: whether jpmorgan will admit to wrongdoing as part of the deal. even though the reported agreement is not yet final, it's generating strong reaction. we get a sampling of that now with dennis kelleher, the president of better markets, a not-for-profit group promoting financial reform, and bert ely, a banking consultant. for the record, he does not advise jp morgan. i will start with you what are the outlines of this deal? >> well, what jpmorgan chase is trying to settle are a variety of claims arising from so past actions but also from actions particularly in the mortgage area by two companies that it acquired, bear stearns and washington mutual ooirz so do you think that this was a good deal for them? >> well, i think that what jpmorgan chase is trying to

do is to just get these issues behind it. so that it can move on with its business this has been hanging over the company. and i think like any kind of problem situation you want to get it revolved and move on ooirz how about that, dennis kelleher. >> it's a darn good deal for them, unfortunately not a good deal for everybody else. in the first instance the headline number gets a lot of attention and it is a big number, $13 billion, which is a lot of money to everybody except wall street. last year jpmorgan's revenue was more than 97 billion. today it has more than 23 billion dollars reserved for legal problems. and what's most troubling is that not only are they apparently going to extinguish almost all civil liability for innumberable egregious violations in wrongdoing relating to compliances in mortgages and other things, but not a single individual is being held accountable, yet again, for all this wrongdoing. and unfortunately, if we don't hold individuals responsible and accountable, then these things are going

to happen again and again and again. >> ifill: the expert ely, let me ask you this question. jpmorgan is one of the companies, that actually went in and helped rescue troubled properties. and for their effort they get this kind of prosecutional, or potential for prosecution. did they-- does that discourage anybody else from even trying? >> i think if definitely does. that in effect jpmorgan chase is being tagged for problems that it did not cause, that happened under the management of the companies that they acquired. and that, frankly s just fundamentally unfair. and morgan is now stuck with this situation. but it definitely is going to discourage acquirers in the future of troubled companies because we will have financial crises in the future and the government is going to be faced again, sometime in the future, with having to sell troubled company that has a lot of problems. and potential buyers are just going to stand back and say no thanks.

>> ifill: what about dennis kelleher point that $13 billion isn't really a lot of money. >> it is a lot of money. he talked about the revenue of jpmorgan chase but there are also allots of expenses. the $13 billion is roughly equal to half of the profits that they made last year. it's been a very exsense-- expensive transaction for them. if they had to do it again, i suspect they wouldn't. >> well, that's just not truement those are the talking points of wall street. but the acquisition of bear stearns and washington mutual were at fire sale prices, they bought bear stearns for 1.3 billion. the headquarter building alone of bear stearns on madison avenue new york was worth 1.1 billion. and jamie dimon refused to do the deal until taxpayers picked up the risk of $30 billion. they got these operations at fire sale prices and they have been spectacularly successful for jpmorgan. jamie dimon is not some r, be in the pumpkin patch, he knew what he was doing. i will give you one fact.

in 2007 if you take the book value, what you could get for jpmorgan chase if you just sold its assets, you take its book value and straight line it to 2012, and you compare it to what its book value is today, there is a $39 billion difference. and that means the value of jpmorgan chase is up 39 billion dollars, that's not as a going enterprise. they have made spectacular amounts of money from these two enterprises. >> ifill: what did jay me dimon, he is a unique figure in all of this. >> well, he's-- the guy without stuck his neck out to do this deal. he's been a leader in the industry. and he's the one who is taking the heat for having done this deal. i do believe that he'll continue to run the company, i know there are a lot of people that think he ought to resign and i simply done think that's going to happen. what he needs to do and his management team needs to do is get this problem behind him so they can run their business. >> does the company have to admit wrong doing? >> this has never happened. does there have to be an individual that heads that role as dennis kelleher is

suggesting for this to be revolume ofed. >> first of all there have been a lot of people that lost their jobs over this. the real question of personal accountability is going to come down to whether or not there will be any criminal charges brought in this situation. >> that's still unclear. >> that's still unclear. and we may not know for months as to how that aspect of it is going to get resolved. >> in fact california among other states is probably pursuing this potential for criminal action. >> the u.s. attorney in california, one of them is conducting an investigation but the likelihood of criminal charges against executives and supervisors here are as remote as possible. the standard is so high in exacting as it should be for criminal charges, and that's why it's so important for-to-go after executives and supervisors on the civil side so that they have to pay real meaningful penalties and that they are held to accounts for their wrongdoing. >> let's get back to jay me die upon. >> this isn't a meaningful penalty? >> first of all it is the bank that is paying, which means it is shareholders paying it.

essentially jpmorgan chase is buying a get out of jail free card today for its executives and supervisors by using shareholder's money, essentially other people's money. not a single individual is being held accountable. >> ifill: does any of that money go to homeowners, for instance? >> as i understand it, $4 billion of it is going to be set aside to help resolve problem mortgages whether it be buying down mortgage balances or compensation to people whose homes were for closed, is yet to be worked out. but supposedly $4 billion of the $13 billion will go to assist homeowners that had problems of one kind or another. >> ifill: i take you don't see it as a get out of jail free card. >> i do not see it as a get out of jail free card by any means. again i think the real concern is what happens in the future there will be a future financial crisis. the government will be faced with having to deal with a large financial institution. and if they have a situation there is no buyer because of unresolved liability issues, then the cost on the

disruption of liquidating a large firm instead of selling is going to be very significant. >> ifill: final word. >> if you don't hold people accountable for egregious, systemic wrongdoing, then they are going to do it again. and this shouldn't be a double standard of justice. one for wall street where they get treated with kid gloves because they are wealthy and well connected and one for main street where you get the book thrown at you if you steal $100. if is wrong. it is corrosive to democracy that actually rewards and incentivizes crime on wall street. so you could have them pay a little less money if you would hold some of the individuals actually accountable. that's what we need to see in this country. >> ifill: dennis kelleher, better ely, thank you both some of. >> thank you. >> we turn now to >> woodruff: we turn now to politics, and the fallout from the 16-day government shutdown. tonight we're launching a series of conversations about where the republican party goes from here. we talk with former senate majority leader trent lott, a republican from mississippi.

he's now a senior fellow with the bipartisan policy center and a senior counsel at the law firm patton boggs. i spoke with him a short time ago. politics and the fallout of the 16 day government shutdown. >> woodruff: form ter senator trent lott welcome to the newshour. >> glad to be back, judy. >> woodruff: so conservative activist richard vigry reported over the booknd say wag is going on in your party right now is a civil war. how do you see? >> well, we don't need a civil war. we need to focus on what is a good agenda for growth in america. and we need to focus on how we can add some more republicans to the house, but particularly in the senate so we would control both bodies. so i think what we need to do is focus on the positive and quit attacking each other. >> woodruff: but right now you have facs in your party, all the way from the tea party to folks who sympathize to with the tea party all the way to a few moderates. >> it is tougher now than it used to be. but if leadership, i always had to deal with that too. i had you know, sometimes

the more moderate members of my caucus were reluctant to do some of the things we wanted to do on tax cuts or you know, defense issues. and the house, of course, you've got some very young and very conservative people that feel strongly that obamacare is going to be a disaster for the country. and they certainly have made that point. but i think the important thing now is to pivot to what is a positive agenda that republicans believe in and will advocate and take the american people. and so then if you were an. >> if you were an establishment republican that is a dirty term, i guess, that you have got an agenda you can talk about that will appeal to everybody. >> woodruff: is it a dirty term? a dirty word to say mainstream staenlt republican? >> well, you know, i've been accused of all of those. although i was conservative before a lot of these people were born. i have a very conservative philosophyment but also, i

admit that i have a philosophy of trying to get things done. and i think that's what you need to talk about. there are a lot of things we need to be doing in government and in america that is not happening right now. for instance, the really big news in america today is in the energy area. just recently we surpassed russia as the number one energy producing country in the world. it's about national security, it's about jobs, it's about growth. why don't they take up the major energy bill, just one example. >> woodruff: but right now you do have members, i'm sure you know this, the tea party saying we still want to defund and do away with the president's health care law. >> well. >> woodruff: an they're not focused on some of these other issues. >> well, they should be. and a agree with them. i would have voted against obamacare. and i would vote to repeal it right now or delay it a year. even the president just came out today and said look, it's a mess. he's not happy with it either. >> woodruff: but was it worth shutting down the government. >> i don't think so i thought that the tactics that were used were not wise.

the republicans should focus on what we can do to help the economy grow. the people out here in the real world, they are still worried about how are they going make a living, are they able to get a job. that is what the focus should be. but also the thing that unites republicans is controlling 9 size of the federal government and controlling spending it is out of control. the debt sealing this next year if they don't get some spending restraint will go up another trillion dollars. that is a big problem for our grandchildren. so that's what i think they should focus on instead of-- it's not enough to just say no to obamacare. i would like to repeal it but it's not going to be repealed as long as the democrats are in charge in the senate and obama is in the white house. they've made their point. they don't like obamacare. they tried a lot of different types of ways to deal with it. they fought the good fight but that fight is over. so now what are they going to do. >> woodruff: but do you think-- i mean how do you bridge these differences, senator lott. we hear what you are saying, but you still have these very conservative members of the party who are saying we're going to continue to

fight on obamacare. we not only want to limit government spending, we want to shrink the size of government dramatically. >> yeah, well, i agree with that. i do want to shrink the size of government. what we need is an a againa to address the problems that we have. principles the president mentioned that we needed to do a farm bill. some people engineered at that, that is the biggest thing on the agenda. as a matter of fact, the farm bill has allots of reforms in it. it does reduce the amount of farm subsidies that are padz out it does have major reform in food stamps. that, both of those are important. but we do need a farm policy in america. i have already mentioned energy. they need a deal with how much are they going fund the government. they should be passing appropriations bills. they should pass defense authorization. we still have military men and women in the field. and the combination of how much we're spending and the sequester is having a real problem on the defense capabilities of our country. >> woodruff: so if you were to have a conversation right now with senator ted cruz of

texas and some of the house members who agreed with him strategy, what would you say to them? >> well, i would say you felt very strongly. you made your case. that fight though, you will always be looking for a way to put some controls on obamacare or eventually repeal it but you need to focus now on what can be done in a positive way. what are some good things that america should be doing now. that group might not like what i'm about to say. but there is a bill that will be moving in the house soon called water resources development act. we have bridges and highways and ports and harbors and water and sewer systems all over america that are collapsing. they create jobs. >> woodruff: infrastructure. >> infrastructure. i will till the infrastructure that obama caulks b he wants to have a bank that will become a slush fund. no, you need to clearly say it's going to go for this particular port, for a water system in jackson, michigan, or jackson, mississippi. that is something people

would say it's tangible. you can see a result it would create jobs. >> woodruff: but if they don't agree with you and others who believe in that, then how, account party really come together? >> well, remember now, i went through this in 1995 when we had the shutdown. i didn't think it was a good idea then either. we came out of it and what did we do to go forward? we developed a positive agenda. we will welfare reform. we had a balanced budget legislation that was passed. we passed safe drinking water. who is opposed to save drinking water, portable of insurance. we pivoted and went to a positive agenda and the net result was we picked up a gain of two seat as soon as the-- in the senate. so what i would urge them to do is what are you for now, as young republican house members. what would you do if you were in the majority. if you can't repeal obamacare or reform it right now, what else would you do. and get on that. >> woodruff: we hear you. former senator trent lott,

thank you for being with us. >> thank you, judy. >> ifill: finally tonight, struggling to breathe in china. 11 million residents ground to a halt after officials discovered that the region's "small partical pollution" has reached record levels-- 40 times higher than the international safety standard. planes didn't fly, buses weren't allowed on roads, and schools were closed. jeffrey brown is back with more. china has seen tremendous economic and urban growth but one of the costs is some of the worst air quality in the world. it's a health issue and increasingly a political one as well. a require for "the new yorker" magazine just reasoned to the u.s. after living in beijing for eight years and joins us now, welcome to you. >> thank you. >> what is the significance of a reading this high. you watched this for many year, put it in some context. >> this is unusually high.

this is, to put it in perspective people walked out of their houses today and thought that there was a blizzard. but in fact it wasn't snowing. this is how intense the air pollution wasment they had to close the airport. this he had to close schools. >> brown: it is stunning to say, just the idea of shutting down a city of 11 million people or so. what does that mean? >> a city of two and a half times the size of los angeles. this is way up in the northeast corner of the country. it's sort of the buffalo of china. it's very cold. and the heat came on yesterday. that was the first big cold day of the winter. and when that happened that meant that they burned all of this coal. and all that coal went into the atmosphere and it spiked and you got this extraordinary, intense air pollution. >> brown: so when, you say the heat came on, meaning-- literally this is how the heating system works. >> the chinese government still maintains very strong control around the country, obviously. and one of the ways it does that is that it sets the day when the heat goes on. so when the heat goes on for a city of 11 million people, that sets an enormous strain on the system. so you've got that.

and then on top of it over the course of the last ten years china has added four times as many cars to the system as there was before. in just ten years. so you have the combination of coal and cars, no wind, and you've got this extraordinary pollution. >> brown: so as this has been happening and not just in this city, of course. what kind of pushingback is there? what kind of response is there now? >> people are losing their patience with it. for years the argue in china that you heard from ode people was our lives are getting better. we have cars we didn't have before. we have apartments we couldn't afford before. and we're willing to put up with air pollution. they're not as willing as they were before. if you go on-line on the chinese web you see people saying things like welcome to the middle class and they mean it bitterly. this is not what they wanted. >> brown: because this was sort of part of the deal, right, as i mentioned economic growth which was coming, and has come. and that's meant huge urban growth to cities like this. >> yeah. >> brown: but this is also now a part of the deal people are less happy with. >> absolutely. it's transformed the country.

there is no question about it. people today compared to 30 years ago, their lives are impossible to compare. however, they worry about the health of their children. there has been, now cancer is the leading cause of death in china. they now know how many die from air pollution every year, 1.2 million people. that is something that people know about. in the past chinese government did not release the data on the air pollution. nobody knew how bad it was. they can't do that any more. there is know social media and they have no choice. they talk about it. >> brown: you've written about this, about what it means in day-to-day life, just give us a little sense of how people have to-- how they cope. >> i mean i will give you an example. we lived in china, my wife and i for eight years after we had been there for a while people realized the best christmas present we could get were air purifiers, we would go in to friend's house and comment on the air purifier t it became a part of life. i men this is, 10 years ago nobody knew that the leaders of the yes lived in a different environment than the ode people did. but now they know that the

people who run the country have air purifiers in their homes. >> brown: that is part of this, the politics of this, the people who can deal with, can cope and can pay. >> exactly. >> brown: to get away from it. >> they used to say the air quality couldn't be that bad was after all the leaders have to breathe the same air we do. and then people started going on-line, started to find out that in fact there is this-- a sort of dual universe. there is the world for everybody. and then there is the world for the top leadership. and they're not happy with it any more. they complain. >> brown: briefly, i mean complain but is it a potential political issue going forward? >> it's been a luge political issue. already you've had protests over the possible construction of chemical plants, for instance. people who didn't ordinarily have a political bone in their bodies is have gotten up and said what i worry about is the health of my kids. and so they will go out into the streets and have what they call strolling protests where they go out and say we're not trying to tome the government. all we're saying is listen to us and prioritize us kbz thanks some of. >> my pleasure.

>> woodruff: again, the major developments of the day. president obama said there was "no excuse" for the problems plaguing the new health care web site, but defended the broader law. new jersey became the 14th state to sanction gay marriage. as governor chris christie dropped plans for further legal challenges. >> ifill: online, our social security expert explains how and when to collect benefits on an ex-spouse's work record. that's on our "making sense" page. and in case you missed it this weekend: you can watch our report from hawaii, where a battle has erupted between residents of kauai and large companies over the development of genetically modified seeds. all that and more is on our web site, newshour.pbs.org. >> woodruff: and that's the newshour for tonight. on tuesday, we'll look at the latest jobs report, delayed weeks by the shutdown, and what it says about the employment picture in america. i'm judy woodruff. >> ifill: and i'm gwen ifill.

we'll see you online and again here tomorrow evening. for all of us here at the pbs newshour, thank you, and good night. >> major funding for the pbs newshour has been provided by: moving our economy for 160 years. bnsf, the engine that connects us. >> united healthcare-- online at uhc.com. >> supported by the john d. and catherine t. macarthur foundation. committed to building a more just, verdant and peaceful world. more information at macfound.org

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