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CNN'S AMANPOUR

The State of America; U.S. Stimulus Cut; The Politics of Inequality; Ukraine: Life Under Siege; Imagine a World

Aired January 29, 2014 - 14:00:00   ET

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


HALA GORANI, CNN HOST: Good evening, everyone, and welcome to the program. I'm Hala Gorani, sitting in for Christiane Amanpour today.

Last night, the President of the United States stood before 535 elected representatives from both houses of Congress and said, "I've got this."

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: But America does not stand still and neither will I. So wherever and whenever I can take steps without legislation to expand opportunity for more American families, that's what I'm going to do.

(APPLAUSE)

(END VIDEO CLIP)

GORANI: Without legislation: he called for a year of action with or without Congress as you just heard on issues from immigration to climate change. But it is unlikely that the president will pass many new laws through this Congress. So he is left with a laundry list of small-bore initiatives filled with verbs like "ask" and "urge."

At its heart, the State of the Union message boiled down to one key theme.

(BEGIN VIDEO CLIP)

OBAMA: Inequality has deepened. Upward mobility has stalled. The cold, hard fact is that even in the midst of recovery, too many Americans are working more than ever just to get by, let alone to get ahead.

(END VIDEO CLIP)

GORANI: Not the national deficit or the national debt, but inequality, the gap between the rich and the poor in America, has mushroomed over the past 30 years. Middle class wages stagnated or fell, even as incomes for the richest 1 percent grew by more 200 percent during that same timeframe. And on President Obama's watch, that top 1 percent captured 95 percent of the income gains in the economic recovery.

He is presiding over the country with the highest inequality and the fastest growing inequality in the developed world. And as that very gap widens, it becomes less and less likely that those born on the bottom will ever climb the economic ladder, the very essence, after all, of the American dream.

We'll take a deeper look at inequality in America in a moment. But first, let's bring in CNN's chief political analyst, Gloria Borger, in Washington.

Gloria, thanks for being with us. First off, some suggest Barack Obama may already be a lame duck president, yet he's making some big promises here.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: . Yes, he is making some big promises and I think, look, this is a president heading into the sixth year of his presidency. He finds himself with a really low approval rating, around 44 percent. The public is incredibly pessimistic about whether he's going to be able to get anything done, right?

So what he did was he came before Congress and essentially said, look, I tried to change the way Washington worked, but I failed. So what I'm going to do is try and work around Washington.

GORANI: All right. So but how important is the State of the Union? I mean, let's look at last year's for instance, also a laundry list of promises.

How many of them were kept?

BORGER: Almost none, except for health care reform, obviously, which has been a -- had a disastrous rollout.

I think State of the Union speeches generally are laundry lists and nobody expects everything to get done that's really on it.

But I think the president intended for the sum here to be greater than the parts, that he wanted to look like a leader, a man of action and what he was essentially doing was taking the side of the American public and saying, look, I don't like Congress, either, and you people think that I don't follow through. So I'm going to tell you that I'm going to follow through on these things, where I can, with the use of my pen.

And also, Hala, I think on immigration reform, which is a really big issue here, I think he went one of his way not to attack Republicans on that issue because there is some hope that they could take some small steps together on getting some form of a -- of a bill through this year.

GORANI: All right. Just stand by for one moment. We are getting news that the Federal Reserve, as expected, has continued its tapering initiative, in other words, pumping less and less money into the economy. The Federal Reserve is reducing its stimulus by $10 billion a month to $65 billion a month, citing improvement in the economic activity, which was one of the good things for Barack Obama as well, Gloria, over the last 12 months, since the last State of the Union. The economy is improving, though it's improving more for the richest of all Americans.

One thing that I think our viewers might find interesting is the response. There's traditionally a response from the other side. This year we didn't have one, we didn't have two, we had three responses, one official response, one Tea Party response and one solo response from Rand Paul.

This isn't a very unified opposition, is it?

BORGER: No, it isn't. You know, it's easier for the party in power to be united because they have a president. This is an opposition party searching for a candidate that's been out in the presidential wilderness for a while. And what you see are the different factions of the Republican Party out there, just as you saw during the whole government shutdown fiasco.

So you had the Tea Party out there. You have the official response from the leadership. And it is a party kind of in search of what it's going to be in the next presidential campaign and I don't think there's any decision yet. And so folks say, you know what, why do we just have to have one response? Let's have a few. Tea Partyers didn't want to let the Republican establishment speak for them. So they didn't.

GORANI: All right, interesting. Gloria Borger, thanks very much.

BORGER: Sure.

GORANI: Our chief political analyst in Washington.

And John Cassidy writes about politics and economics for "The New Yorker" magazine, and John joins me now from New York.

The big theme, inequality, this year from the president, but saying that, you know, essentially Congress is not going to be working with him, that he'll do things without Congress in order to solve some of these big inequality issues.

Is it going to happen?

JOHN CASSIDY, "THE NEW YORKER": Well, the measures he proposed were actually very modest, if you looked at it closely. He's said that he's going to order federal contractors to increase the minimum wage to about $10 an hour. That's only going to affect a few hundred thousand people.

I mean, the great paradox about this debate -- or this speech rather - - was that, as you said, the whole theme was reducing inequality, which has really risen very sharply in the last couple of decades in the United States and has become a really big political issue here.

But because Congress is in the hands of the other party, the president just doesn't have the power to do things like raise taxes on the rich and (INAUDIBLE) --

(CROSSTALK)

CASSIDY: -- tax, the sort of serious things you can do to reduce inequality.

GORANI: But why? This is a trend that's 30 years in the making. You have voters who can, in a democracy, select their leaders.

Why, year after year after year, are they not selecting those leaders who will work for the vast majority of Americans and allow them to get a bigger piece of the pie and more of the dollars that come out of this tepid recovery?

CASSIDY: Right. Well, there's two schools of thought on that, Hala. One school of thought is Americans don't like higher taxes. That's the sort of Ronald Reagan view of the world. And influence the Democrats for, you know, a long time, too, Bill Clinton and people of that ilk were very, very reluctant to be tagged as tax raisers.

Obama's gone a bit further in that direction, but there's still a big reluctance in the White House to be seen as the party of high tax.

Now, on the other hand, if you look at the more recent opinion polls, what you find is there appears to be strong support in the country for higher taxes on the very wealthy. The thing about this rising inequality, it's not just the sort of modest rich who've done very well. It's the very, very, very rich who are making hundreds of millions of dollars a year. And there's widespread support for raising taxes on that group, on that group --

(CROSSTALK)

GORANI: So why isn't --

CASSIDY: -- but somehow Washington can't (INAUDIBLE). That's the other theory is, of course --

GORANI: Is it because the --

CASSIDY: -- rich --

GORANI: -- is it because the political system relies so much on corporate donations that you have legislation that goes through quite easily protecting the interests of corporations and of those who are extremely rich? I mean, that --

CASSIDY: Exactly, I mean --

GORANI: -- yes.

CASSIDY: -- I mean, you know, the Democrats, for example, during the -- in the 2012 campaign, President Obama, one of his bigger issues was that Mitt Romney was only paying tax of 15 percent because there's a tax break for private equity and hedge fund managers like Romney and Bain Capital.

But the president's, you know, been in power another year and a half since then. And he hasn't done anything about it. Now why is that? Part of it's because the Republicans wouldn't -- probably wouldn't support it, but also, you know, big hedge funds and big private equity companies are big supporters of the Democratic Party, too.

So it's certainly very difficult to get anything which hits this sort of group, you know, through the political system.

GORANI: So from the Left and from the Right, you have the same interests at play here.

So what will change? What will allow the situation to change for ordinary Americans? I mean, not even -- not just the top 10-20 percent of income earners in this country, but just average middle class Americans who are getting so squeezed? What will it take? Will it take their anger? Will it take them truly voting out of office those who they perceive as not working in their self-interest?

CASSIDY: Well, I think there's two issues here. One, what would it take to get a bit sort of political movement for radical changes in the sort of income distribution, higher taxes, guaranteed minimum income for poor people, et cetera?

That's -- doesn't seem to be very viable at the moment. There -- it's a great mystery as to -- as to why it isn't wider on the poor and the middle classes rise up against the rich, who are now at a 1 percent of the population in the U.S. now takes 22 percent of the income, one of the top 1 percent also has more than 40 percent of the financial assets in the country.

But for whatever reason, whether it's because the political system is dominated by the sort of wealthy interests, or whether it's because in American middle classes themselves, there's still this Horatio Alger dream that they could be rich one day, so they don't want to take any action against the very wealthy. It's a very difficult program to get through.

GORANI: So what are we looking at, then, going forward, economically? Because is it in the best interest of the economy in a country like the United States for this middle class to be able to earn more, of course, get more of what's come out of this recovery, and spend more? How much would it -- is that why the recovery has been so weak as well?

CASSIDY: I mean, economists have divided about that. It seems to make common sense, though, I mean, going back to Henry Ford, who, we know that if you -- I mean, pay the great masses of the workers more money, they'll spend more money. That should help the economy.

The last 20 years has basically been no income growth in the middle classes; wages have been stagnant and that's certainly ,you know, held back American businesses to some extent.

The president, in his speech last night, did talk to American businesses and business leaders, saying, you know, you can try and give your workers a rise or a raise, but of course, it's unlikely to get much response on that one. American businesses, like all the businesses around the world, are primarily taken up with cutting costs and making as high a profit as they can.

GORANI: But the CEOs are still making tens of millions, though.

CASSIDY: Well, again, you know, that's the -- sure, the gap between the CEO and the man on the shop floor, the woman on the shop floor, you know, used to be 20 or 30 times about 1970s. Now it's like I think 400 times the CEO makes of the average guy.

GORANI: All right --

(CROSSTALK)

CASSIDY: That has produced some, you know, it has produced some anger and you see, as I say, support in the polls for taxing the rich more. But for whatever reason, the political system doesn't seem to be able to respond to it.

GORANI: All right, John Cassidy of "The New Yorker," thanks so much for being with us --

CASSIDY: Thank you.

GORANI: -- on the show today.

And while the president's speech focused mainly on domestic issues, traditionally he does address foreign policy, vowing to keep up the pressure, for instance, on the Assad regime in Syria, threatening to veto any new sanctions against Iran that might scuttle nuclear negotiations.

And he also briefly touched on the current crisis in Ukraine. Listen.

(BEGIN VIDEO CLIP)

OBAMA: In Ukraine, we stand for the principle that all people have the right to express themselves freely and peacefully and to have a say in their country's future.

(END VIDEO CLIP)

GORANI: All right. But are words enough to prevent a civil war? After a break, we'll hear from acclaimed Ukranian writer Andrey Kurkov, an eyewitness to his country's coming apart at the seams. That is when we come back. Stay with us.

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(COMMERCIAL BREAK)

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GORANI: Ukraine is on the brink of civil war. That warning from the country's first post-independence president, Leonid Kravchuk. As Parliament began, another emergency session today, in the midst of continuing protests across the country.

Lawmakers are debating an amnesty for detained protesters, but for that to happen, the president, Viktor Yanukovych, wants demonstrators to tear down their barricades and leave official buildings.

Now the protesters aren't doing that. There's no sign of that yet and many protesters say they won't leave until the president leaves himself.

At least four people have been killed since the protests began in November when the president reversed the decision to sign a long-awaited trade deal with the European Union in favor of stronger ties with Russia.

But now the uprising has become about a lot more than just a deal. Acclaimed Ukranian writer Andrey Kurkov said these protests are about basic human rights and freedoms. He joins me now live from Kiev, where he's been witnessing events first-hand.

Thanks for being with us, Andrey Kurkov.

First of all, I have to ask you, what is it like just being in Kiev during these events?

ANDREY KURKOV, UKRANIAN WRITER: Well, I have been here all the time except for a couple of days. And I live 500 meters away from Maidan, from the protests. So the life is normal next street from Khreschatyk. But once you are coming down to Khreschatyk or Independence Square, of course, you face barricades. You have to go through a very narrow passages between barricades. You see people who have now hide their faces, who are armed with clubs, who are bullet -- carrying bulletproof vests and there is a kind of wartime zone.

But I, at the same time, just 30 meters away from the barricades, there is a school which was all a couple of days ago closed down. And before that, all during the period of protest, the children were -- the children were taken by parents to the school.

GORANI: So you have a very small portion of the city, as you just mentioned there, where this is all happening. But it's capturing the attention of the world. In your opinion, what is at stake here for your country?

KURKOV: Well, actually at stake, there are lots of things at stake. The European or the civilized future of Ukraine, but most of all, actually, the -- it's the question of rule of law, because for 23 years, there was no rule of law in the country. Nobody was respecting the laws and actually the laws were used to punish the enemies.

And they were extensively used to punish the enemies during last three years, when the president -- Yanukovych, actually became the president to tell them 10 afterwards, it became impossible. You had either to join party of region and to become one of their army, you know, to run small business or medium business. Or you would be either thrown out of the country or accused of tax evasion and in any way you would be destroyed.

GORANI: Now the -- of course, we've heard these warnings that the two sides are so far apart -- and there is so much animosity between them, that there is a risk of civil war in Ukraine. Do you think that risk is real?

KURKOV: I think it is an exaggeration. There is a big split, bigger split than it was before. And the split was created by the politicians. What is happening now, I mean, from the very beginning, it was a civil conflict of society against the government and the president.

In order to show that this is comes from between two mentalities, two different regions of Ukraine, the downward people started bringing, busing people from the east, from around the Kiev -- from the towns around the Kiev. They were paying them to participate in Prague element demonstrators. And if they were, for example, clashes between two groups of demonstrators, they could be portrayed as clashes between two ways of thinking. But it didn't happen so far.

GORANI: Now Vladimir Putin said he was in Brussels. And he said essentially Ukraine doesn't need foreign interference, referring to those from the European Union or even the United States, on to Kiev, who've expressed their dismay with the current Ukranian presidency. And they say, of those demonstrators, essentially, that they're taking their orders from Western interests.

Is there any truth to that?

KURKOV: There is no truth in this, actually. There are -- there was always a lot of Russian interference in Ukraine. The only foreign military bases on the Ukraine territory is -- are Russian Black Fleet bases in the Crimea. And the protesters outside -- I mean, they don't speak foreign languages, most of them came from small towns and villages in the western part in the central part of Ukraine. And they don't understand actually maybe what means Europe, because now the protests are not about Europe. It's about the -- this government, the corruption, the lack of rule of law, the President Yanukovych and his family and close friends who --

GORANI: And --

KURKOV: -- practically are controlling the gas supplies and everything.

GORANI: -- so do you agree, then, lastly, that nothing will be solved ,that these protesters should stay in the -- in the square until the president leaves, that there's no other solution that is acceptable here? Is that your opinion?

KURKOV: I think there should be a solution found, because it's not easy to live in the tents with -15, -20 outside. And people, I mean, they are very traumatized psychologically, people who are staying here for two months. In the beginning, they were very jolly, happy, happy to talk to strangers. Now where often they are hiding their faces, they are very gloomy. They are not very sociable.

And in this -- I mean, they don't expect anything good, because nobody trusts the politicians from the party of regions, from the ruling party. But only 10 percent of the protesters trust opposition leaders because the opposition caught up with the protests later, the protests started without political support or organization.

GORANI: All right. The (INAUDIBLE) --

(CROSSTALK)

KURKOV: What's going to happen, if president finally promises early elections, for example, not 2015 March, as it is planned, but the end of 2014, maybe that would be enough to stop the protests.

GORANI: Thank you very much, Andrey Kurkov, a famed writer, for joining us from Kiev with what's going on in your country and how we're able to see it through your eyes. Thanks again.

And the crisis in Ukraine has also taken a toll on those covering the story. The Committee to Protect Journalists says dozens of reporters were attacked and their equipment damaged earlier this week.

As we've been reporting on this program an assault on journalism is also taking place in Egypt, where today state media say 20 journalists were charged with assisting a terrorist group and deliberately falsifying their reporting.

Three Al Jazeera journalists, Mohamed Fadel Fahmy, Peter Greste and Baher Mohamed have been in jail for one month. They are among the group now being referred to Egypt's criminal court.

It's a story we'll continue to follow closely here on AMANPOUR.

And after a break, imagine the president's State of the Union address upstaged by the guest list -- public relations versus policy -- when we come back.

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GORANI: And a final thought tonight, while President Obama delivered his State of the Union address last night, laying out his vision for the next two years, in this age of optics, the eyes of the world were also directed to the gallery above, where first lady Michelle Obama hosted a carefully crafted guest list that included two survivors of the Boston Marathon bombing, an openly gay NBA basketball player and an emotional salute to Cory Remsburg, a wounded veteran of Afghanistan.

(BEGIN VIDEO CLIP)

OBAMA: Michelle's.Cory is here tonight. And like the Army he loves, like the America he serves, Sgt. 1st Class Cory Remsburg never gives up and he does not quit.

(APPLAUSE)

OBAMA: Cory.

(END VIDEO CLIP)

GORANI: It was a moving moment. But imagine a world where this speech and not this spectacle is what really matters. The idea, the very idea of showcasing presidential guests began with Ronald Reagan's administration.

In 1982 first lady Nancy Reagan saved a seat for Lenny Skutnik, an unlikely hero who jumped into the icy waters of the Potomac River to help rescue survivors of a plane crash. In the years and administrations that followed, the invitation list began to multiple and the guests, like Afghan President Hamid Karzai, grabbed more of the spotlight.

And yet there was a time when the address itself was the only story, like in January 1964, when President Lyndon Johnson launched his Great Society with these words:

(BEGIN VIDEO CLIP)

LYNDON JOHNSON, FORMER PRESIDENT OF THE UNITED STATES: And this administration today, here and now, declares unconditional war on poverty in America.

(APPLAUSE)

(END VIDEO CLIP)

GORANI: And in January 1941, less than a year before the U.S. would enter World War II, President Franklin Roosevelt used his State of the Union address to proclaim his four essential freedoms, freedom of speech, freedom from want, freedom of worship and freedom from fear.

The U.S. Constitution doesn't actually require the president to deliver his address in person. President Woodrow Wilson began that tradition over 100 years ago, speaking to Congress in 1913. But George Washington, who was first in war, first in peace and first in his heart of his countrymen, stayed at home and sent his first State of the Union message to Congress by messenger, hand-written and without a single guest in the gallery.

That's it for our program tonight. And remember you can always contact us on our website, amanpour.com, and follow me on Twitter, @halagorani.

Thanks for watching and goodbye from the CNN Center.

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