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Scandals Taint Christie's Inauguration; Search For "Black Widows" Near Olympics; Two New Arrests In Credit Card Fraud Case; Temps To Drop 10-20 Degrees Below Normal For Almost Half of The U.S.; D.C. Government Offices Closed Ahead Of Storm; Propane And Heating Oil Shortages Reported Throughout The Midwest; Two Dead, Four Critically Hurt In Plant Collapse; Family Pleas For U.S. Hostage Release; Poll: 67 Percent Unhappy With Wealth Distribution; 500 Plus Being Treated After Chemical Leak

Aired January 21, 2014 - 10:00   ET

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


CAROL COSTELLO, CNN ANCHOR: Good morning. I'm Carol Costello. Thanks so much for joining me.

It is inauguration day in New Jersey but Chris Christie is sharing the spotlight with scandals that are casting long shadows on him and his presidential ambitions. Just minutes ago, we learned that the state assembly and senate will form one committee to investigate allegations of abuse of power.

At Christie's side today and at the center of the latest controversy, his lieutenant governor, Kim Guadagno. She is fiercely denying claims she tried to strong arm Hoboken's mayor on Christie's behalf. Hoboken's mayor a Democrat, brushed off her denial in an exclusive interview with Anderson Cooper.

(BEGIN VIDEO CLIP)

ANDERSON COOPER, CNN HOST: So when you see the lieutenant governor, I mean in a press conference now saying, point blank, your memory and recollection of this conversation is offensive, is completely inaccurate. And as a victim of Sandy, she is offended. What are you -- you're saying she is lying?

MAYOR DAWN ZIMMER (D), HOBOKEN, NEW JERSEY: Yes. She said she would deny it and she is denying it. So part of me is not surprised. My reaction back is, you're offended. How do you think I feel and everyone in Hoboken feels? We haven't really, you know, we haven't given out much Sandy funding and we have been told that there is connection between the two. And there is a push to get one particular project through.

(END VIDEO CLIP)

COSTELLO: CNN's Erin McPike is in Trenton with a preview of Christie's inaugural address. Good morning.

ERIN MCPIKE, CNN CORRESPONDENT: Carol, good morning to you. Well as you can see, the snow has finally started here in Trenton and because of this severe winter weather, the Christie administration decided to call off tonight's inaugural party at Ellis Island. However, the main event is still going on. Christie will be coming here. The ceremony begins at 11:30. This is the Trenton War Memorial. He will be sworn in around noon and get about a 25-minute address. Aides say he won't be addressing any controversies that we have been talking about recently.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Governor Christie, do you have a few seconds, sir?

MCPIKE (voice-over): In his prepared remarks, the embattled New Jersey governor is expected to discuss the need for smaller government and unity among the people, but apparently, missing, the scandals engulfing his administration. On Monday, forceful denials and charges of lying flew back and forth between Chris Christie's Lieutenant Governor Kim Guadagno and Hoboken's Democratic Mayor Dawn Zimmer.

LT. GOVERNOR KIM GUADAGNO (R), NEW JERSEY: The suggestion that anyone would hold back Sandy relief funds for any reason is wholly and completely false.

MCPIKE: Guadagno, a Sandy victim herself, called Zimmer's accusations false and illogical. Zimmer spoke exclusively to Anderson Cooper on Monday night about the alleged threat.

MAYOR DAWN ZIMMER, (D), HOBOKEN, NEW JERSEY: This isn't something that, you know, forget. When the lieutenant governor of the state of New Jersey tells you in a parking lot, you remember it. I was very upset. I did a journal entry a few days later.

MCPIKE: Zimmer also accused New Jersey Community Affairs Commissioner Richard Constable of intimidation for the project. He says the claims are absurd, adding, "I welcome a full and thorough law enforcement review of her libellous claims." Complicating matters, Zimmer herself has given different versions of her story and still supports Christie's record as governor.

ZIMMER: He has done very good things for Hoboken. I mean, I think he's done terrific things for the state. Overall, I do think that he has been a great governor.

MCPIKE: A new national poll from the Pew Research Center shows his unfavorable rating doubling in the past year from 17 to 34 percent. A majority of respondents who have heard of the George Washington Bridge controversy say they don't believe Christie when he said he wasn't aware his aides ordered the lane closures.

(END VIDEOTAPE)

MCPIKE: Now, Carol, we have some new video in just now of Chris Christie this morning kicking off inauguration day at a prayer service. You'll see there he appears to be in very good spirits. We'll see if that changes later today. There is a new Quinnipiac poll coming out at 3:00 in terms of what people think of him nationally in the wake of these scandals. So standby later today to see what the results are. COSTELLO: It is interesting. He is sticking to his message in spite of these scandals. We have an excerpt of Chris Christie's speech he will deliver in an hour.

We cannot fall victim of the attitude of Washington, D.C. saying I'm always right and you are always wrong. The attitude that puts everyone in a box they are not permitted to leave. It puts political ahead of policy agreements, the belief that compromise is a dirty word. That is kind of ironic in light of all he is accused of today.

MCPIKE: Carol, that's right. As you know, over the past four years, he has developed a big record of bipartisanship. That is what he is trying to take with him on to the national stage and obviously today, the national spotlight is on him and a preview of what he may do and run for president in 2016.

COSTELLO: Erin McPike, live from Trenton, stay with us for live coverage. Our coverage begins this morning, 11:00 Eastern with Jake Tapper.

Happening right now, two Russian Special Forces are conducting two anti-terrorism operations in the Republic of Dagestan, not far from the site of the Olympic Games. That's according to the Russia state news agency. These anti-terrorism operations come as the search intensifies for this woman, a terrorist known as the black widow.

Police around the games are now handing out fliers searching for her because they think she may be planning an attack. But they also suspect there are two more black widows threatening terror attacks in and around Sochi, says the State Department and the U.S. military send two U.S. warships to the Black Sea along with helicopters and 17 aircraft in case American athletes need to be evacuated. One security expert says, safety is not just up to one country.

(BEGIN VIDEO CLIP)

DON BORELLI, FORMER MEMBER, FBI JOINT TERRORIST TASK FORCE: The key for any major event, specially the Olympics, is robust intelligence, not just on the backs of the Russians. Everybody has a responsibility, the U.S., our European partners, everybody collecting intelligence and sharing it with one another.

If the events are going to go off successfully and safely, it is going to be on everybody to be working. All hands on deck, collecting that intelligence and sharing it.

(END VIDEO CLIP)

COSTELLO: Phil Black is in Volgograd, Russia with more on the black widow. Good morning, Phil.

PHIL BLACK, CNN CORRESPONDENT: Good morning, Carol. Yes, black widows, they are suicide bombers who usually act to avenge the loss of a husband or another loved one, who become radicalized in the process. Russia knows what they can do all too well. They have attacked and killed many people here in the past.

As you mentioned, authorities here believe to be tracking a number of them in the lead up to the Sochi games. They are a threat that people know about. They were never supposed to get this close to Russia's Olympic city.

(BEGIN VIDEOTAPE)

BLACK (voice-over): Russian police are racing against the clock to find this woman who they say may be working with a known terrorist organization planning an attack on the Olympics. And she may already be inside Sochi ready to strike.

JEFF BEATTY, SECURITY CONSULTANT: Obviously the Russian security forces are concerned that perhaps people have already penetrated their outer perimeter and are in Sochi.

BLACK: The 22-year-old Ruzana Ibragimova is described as a black widow, a notorious type of suicide terrorists that's emerged in Russia's clashes with Chechen separatists. Police distributed fliers to hotels in Sochi and they're asking staff to be on the lookout for her. Experts say there could be other so-called black widows planning a strike.

UNIDENTIFIED FEMALE: We shouldn't assume that she is the only they are concerned about. She's likely part of a larger network that they're looking at.

BLACK: Ibragimova is believed to be from Dagestan, a Russian republican in the caucuses region. In the U.S., law enforcement agents have been conducting knock and talk interviews with people from that region for weeks, asking community members if there are any issues where they should be focusing.

This morning, the Russian Anti-Terrorist Committee posted a statement saying they killed seven rebels in Mahatchala, Dagestan early last week. One of those killed is a black widow by the name of Zaira Aleva.

All of this after a new terror threat this past weekend from two young men in this video claiming responsibility for twin suicide bombings in Volgograd last month. They say, as for the Olympics, we're prepared a present for you. Terror analysts say Sochi is uniquely at risk because Islamic militant hotbeds are within the country leaving the Olympics closer than ever to danger.

(END VIDEOTAPE)

BLACK: Russian authorities continue to say they are doing all they can. Their plan is in place. They believe the Olympics will be safe. They are making no comment whatsoever on this Sochi black widow suspect. The only reason we know about her is because they have gone to hotel workers and asked for their help in trying to find her. Authorities are clearly concerned.

This was not supposed to happen. The so-called ring of steel around the city was supposed to prevent these sort of terror suspects from getting close to the games. It appears one may have slipped through, with the opening ceremony just a few weeks away -- Carol.

COSTELLO: Phil Black reporting live from Russia this morning.

Just weeks after that massive breach at Target, police in South Texas have arrested two Mexican citizens along the border near McAllen, Texas in another troubling case of credit card fraud. They say the duo was carrying nearly 100 fake credit cards containing account information from Texas residents. The suspects are accused of racking up tens of thousands of dollars reportedly at Best Buy, Walmart and Toys "R" Us. Now initially the arrests were thought to be linked to the Target hacking, but investigators now say that may not be the case. We'll keep you posted.

It's pretty much no escaping the extreme weather today. A major snowstorm could bring life to a standstill along the east coast. It is already keeping air travelers on the ground. More than 2,000 flights have already been cancelled this morning. In Indianapolis, drivers woke up to snow-covered roads and a pretty darn slow commute.

In Washington, D.C., government offices are closed ahead of today's winter storm threat and now many people are facing bitter cold across the Midwest and they have another concern, will they be able to keep warm? Because millions are facing a propane shortage, the demand for propane is so intense there is a state of emergency declared in Ohio and several others. One propane retailer says he has no idea when he will get a new shipment in.

(BEGIN VIDEO CLIP)

SCOTT ZURA, PROPANE RETAILER: I'm concerned. I'm concerned now because we don't know when we are getting it, we don't if we are getting it. All the propane companies are kind of in the same boat.

(END VIDEO CLIP)

COSTELLO: The Department of Transportation has eased some restrictions on transporting propane to help replenish the empty tanks. George Howell has that story from Chicago. Athena Jones is live on the National Mall in D.C. But George, I want to start with you. Good morning.

GEORGE HOWELL, CNN CORRESPONDENT: Carol, good morning. As you mentioned, We know that more than two dozen states have eased restrictions on propane drivers. Just to help them get into those areas, those communities where people need it most. Again, you talk about bitter cold, here in Chicago, I think we know a thing or two about that, bitter cold right now. It is 3 degrees here.

Overnight, we saw the effect of lake effect snow. It is typical here in this area. It comes in just as fast as it goes away. We did get a few inches of snow here. The same system we saw here in the Chicago area. Also, out in Fargo, in Bismarck, those areas were hit as well.

The same system we saw here, heading out toward the east, headed toward New York City and Washington, D.C. where you are already seeing many officials there taking precautions as the storm moves forward -- Carol.

COSTELLO: All right, George Howell reporting live from Chicago this morning. So let's bring in Athena Jones. She is live on the National Mall. Good morning, Athena.

ATHENA JONES, CNN CORRESPONDENT: Good morning, Carol. The snow has gun to fall as you can see here in Washington, D.C. not a meaningful accumulation yet. This snow is expected to pick up in the next few hours. It is not supposed to stop until after 9:00 p.m. The National Weather Service has issued a winter storm warning and a windchill advisory for this area.

We could see snow accumulations of between 3 inches to 10 inches. Wind gusts could reach 28 miles an hour and the temperature is supposed to fall into the teens by the afternoon, and it's below zero with windchills 7 degrees below zero overnight. A lot of cold and a lot of snow coming, but the city has been bracing for the storm. The federal government is closed.

Many school systems are closed. There had been 200 snowplows out on the streets since 8:00 a.m. this morning. I have seen several trucks blowing salt on the roads to make sure they are passable and to avoid that ice that can be so dangerous. One more thing the National Weather Service is saying is that travelling will become dangerous. Only travel in an emergency.

If you must travel in your car, be sure to keep a blanket, an extra flashlight, food and water in your car in case of an emergency. They are really advising folks to stay off the roads. So far, not nearly as much traffic as you usually see -- Carol.

COSTELLO: That's a good thing. Digging your hat too, Athena. I love that. Thanks so much.

Still to come in the NEWSROOM, tense moments outside a plant after a fire and partial building collapse. CNN's Dan Simon is covering that story for us. Good morning.

DAN SIMON, CNN CORRESPONDENT: Good morning, Carol. You can see part of that partial collapse behind me. This is where Also, very cold today in omaha. Minus 2 below. They will be going in and trying to recover a second body. We'll tell you about it coming up.

(COMMERCIAL BREAK)

COSTELLO: Federal investigators are trying to figure out what caused a devastating fire and partial collapse of a feed plant in Omaha, Nebraska. It killed two people and critically injured four other. Now the plant has a troubled history. It was cited 35 times by OSHA. CNN's Dan Simon is in Omaha this morning. Good morning.

SIMON: Good morning, Carol. A tragic accident here, this is called the International Nutrition Company. This is a company that produces feed and other products for livestock. You had 38 people inside the business yesterday and you had some kind of collapse. All but two people made it out alive, ten people also taken to the hospital, four of them in critical condition.

What firefighters tell us is that there was a fire, some kind of collapse. They are investigating whether it was triggered by some kind of explosion.

(BEGIN VIDEO CLIP)

BERNARD KANGER, OMAHA INTERIM FIRE CHIEF: There has been a lot of discussion regarding whether there was an explosion or not. We are not prepared to make a comment with regards to what actually happened. It is very premature right now for us to make any comments like that. There have been reports of fire and explosion. What we do know, there was a significant event that occurred that resulted in a catastrophic failure of parts of that building.

(END VIDEO CLIP)

SIMON: The body of a 53-year-old man was taken out last night. They had to suspend the recovery because it was so cold. We understand the crews will be back out here today to try to recover the second body. Carol, you talked about this business being cited by OSHA. The most recent occurring just a few years ago where they received six citations, fined $10,000 for various safety issues. Still no word on what might have caused this partial collapse and fire yesterday.

COSTELLO: All right, Dan Simon, reporting live from Omaha, Nebraska this morning. Checking other top stories this morning at 18 minutes past the hour, the family of U.S. hostage, Kenneth Bae, making a direct plea to the North Korean government in an effort to get him released.

It comes as Bae is seen in a new video admitting to quote, "a serious crime and asking to be pardoned." Experts say North Korea has a history of getting false confessions shortly before releasing hostages. Bae has been held in North Korea since November of 2012. He is accused of trying to bring down the government.

You could face longer delays at the airport because of new FAA rules meant to reduce the risk of mid-air collisions. According to the "Wall Street Journal," the FAA has ordered more space between takeoffs and landings at 16 airports including New York, Chicago, and Dallas. Pilots and air safety experts support those new rules.

Great news for the passengers rescued from a research ship stranded for two weeks in Antarctica. All 52 will soon be back on solid ground. The Australian icebreaker that picked them up docks in Tasmania tomorrow.

On the heels of a report about the wealthiest 1 percent owning nearly half of the wealth across the globe, now we are learning how Americans feel about the way wealth is distributed here at home and they are not happy. CNN chief business correspondent, Christine Romans, is here with that report. Good morning.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: No, Carol, they are not happy. They seem to know what all of us have been talking about for the last coming years. Income inequality is a big economic theme our time. You know, the president has made this his signature economic theme of the year. You are mentioning that poll in Davos, Switzerland that found that so much of the world's wealth is concentrated into a few hands.

This is a Gallup poll, brand new, your satisfaction with income wealth distribution in the U.S. Only 7 percent are very satisfied, but look at that 39 percent are very dissatisfied, 28 percent are somewhat dissatisfied. Here is one other statistic to show you why. In the recovery, Carol, the bulk of the gain, the economic benefits of the very top, the top 5 percent, the top 1 percent have captured 95 percent of the income gains in the recovery. Everyone else shares just 5 percent.

That shows you incoming equality at work. The White House and many Democrats pushing to raise the minimum wage, they say a living wage this can ameliorate this. It is not incoming equality that is the problem, but more social immobility that worries him. The fact that you can't move up from where you started, it will be the trend of the year.

Quickly, I want to show you that study you were talking about from the world economic forum in Davos. The world's biggest leaders are going to discuss this. Eighty five richest people in the world have the same amount of wealth as 3.5 billion poorest people, Carol. There has always been great income inequality in the world. This could be one of the biggest risks of the economy in developed nations and developing nations this year -- Carol.

COSTELLO: You could say income inequality has been around forever, but the gap is widening. That's the real problem in the country, right?

ROMANS: That's the real problem and as Senator Marco Rubio will point out, that wide gap that you can't get yourself from one to the other. That starts to become a real concern. How do you make sure we have the policies in place to get from one to the other? Some will say that globalization and technological change over the past 20 years, Carol, have been so big.

It is almost like a kind of technological revolution. It makes it easier to push jobs off to the cheapest labor markets. That really hurts the people that already have wealth. That's part of the problem. It is certainly more complicated than one or two quick policy fixes. That's what they are really struggling with.

COSTELLO: Christine Romans, many thanks. Still to come in the NEWSROOM, the water should be fine. Most people around Charleston, West Virginia, they are still not drinking the water. Doctors are still seeing patients who are affected by the water. Is the water really safe?

(COMMERCIAL BREAK)

COSTELLO: New developments on the West Virginia chemical leak that contaminated the water supply of 300,000 people. Top state officials now calling for tighter regulations, a bill proposed by the governor would mandate annual tank inspections and require new emergency plans in the event of a spill. The company whose plant leaked 7500 gallons of coal-cleaning chemicals into the water supply has filed for bankruptcy. It did that last week.

The water company says the water around Charleston is safe to use. Try convincing the thousands of customers. Hospitals are still seeing patients with symptoms from the odor and sediment.

Dr. Rahul Gupta is the executive director of the Health Department in West Virginia. Good morning, sir.

DR. RAHUL GUPTA, EXECUTIVE DIRECTOR, KANAWHA CHARLESTON HEALTH DEPARTMENT: Good morning, Carol.

COSTELLO: Thank you so much for being here.

A lot of people say that a smell is still emanating from their water. Why would that be if the state says the water is safe to drink?

GUPTA: We are still seeing the odor or the smell coming in. It is not the pure chemical, but the crude chemical that spilled into the river that has about seven compounds in it. Perhaps the smell has a very low threshold. Even the minimal amount of chemical, as long as it is there, the smell is still there.

COSTELLO: Well, some people say the smell is so strong from the water coming from their tap, it is giving them migraines. It is causing them to become sick to their stomach and a lot of them are going to the hospital.

GUPTA: Well, that's accurate. We are seeing about 500 or more emergency department visits in about over two dozen hospital admissions since all this began. Almost half of them have happened after the water flushing and they were allowed to be having safe water. The problem here is the reactions have been skin reactions that could be explained by hyper sensitivity or allergic type or odor related. We need to understand, these are not causality proven. There may be a link to the compounds in the water to some of these symptoms.

COSTELLO: Isn't that disturbing the state of West Virginia says, go ahead and drink your water, but the smell of it might make you sick?

GUPTA: We have been very consistent from the beginning to assert that it is the West Virginia American Water Company that's been saying the water is safe. When we started to see these symptoms in people in our community, we have totally always said that it is your decision and if you don't feel comfortable drinking the water, which has a smell.

It's OK to be sticking to the bottled water for a few days to weeks until that clears up. If you want to drink tap water instead, it is OK too. So we have been very consistent in sending that message to let people make their own decision for themselves, their children and their families. COSTELLO: If I'm a consumer in that area, I want my health officials to tell me what's safe and what is not. I don't want it left up to me. I want to know. I want to trust you.

GUPTA: Absolutely. The challenges here have been that the guidance that's coming to us has been slow and it has been challenging. So what we are trying to do is manage the public's distrust and outrage. We share some of that outrage in situations that are happening. The fact is, it is a very unique situation. This has not happened before in this manner. A lot of the chemicals, testing, and other factors are being developed in real time as we go forward. It is a very challenging situation. It is not something that has happened in this manner prior.

COSTELLO: The company that leaked the chemical into the water declared bankruptcy. Is that making things more difficult for you?

GUPTA: That's definitely troubling. It is also troubling that there were some studies that we were not aware of for several days afterwards when factors were taken into account to develop the testings protocols for the chemical. There are a lot of questions that have been so far unanswered in the whole process. I'm sure our leaders and others are going to be making sure that this does not get repeated again.

COSTELLO: Dr. Rahul Gupta, thanks so much for joining me this morning. I appreciate it.

Still to come in the NEWSROOM, protecting hundreds of thousands of Olympic athletes, leaders and spectators -- a tall order for Russia and we're just two weeks away from the games. Do the Russians have enough security in place? We'll talk about that.

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