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Nuland Apologizes; Turkish Airliner Diverted After Bomb Threat; January Jobs Report; Opening Ceremony's; Phone Call Recording Released

Aired February 07, 2014 - 12:00   ET

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

ASHLEIGH BANFIELD, CNN ANCHOR: Have yourself a wonderful weekend. Thanks for being with us today. AROUND THE WORLD starts right now.

SUZANNE MALVEAUX, CNN ANCHOR: Security is high. Everyone is watching at the opening ceremony for the Olympic games going on right now in Russia.

MICHAEL HOLMES, CNN ANCHOR: And another disappointing jobs report. We're watching the markets and your money ahead.

MALVEAUX: And a high-level U.S. diplomat is caught using profanity while talking about the European Union. But the real story might be how the private conversation was leaked.

Welcome to AROUND THE WORLD. I'm Suzanne Malveaux.

HOLMES: And I'm Michael Holmes. Thanks for your company.

Now, let's talk about the latest reality check about the U.S. economy. Take a look at the January employment numbers that the government put out today, 113,000 jobs were created last month.

MALVEAUX: So, that's actually better than December, but well below the 178,000 jobs that economists were predicting. Now, the unemployment rate dipped just a little to 6.6 percent. That is the lowest, however, in five years. But it could be because more people are dropping out of the labor force.

Want to go to Alison Kosik at the New York Stock Exchange.

So, paint the picture here for us. I mean they've been called disappointing numbers, weak, but the big picture could look different.

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Exactly. And, sort of all that is true. So keep in mind that two months, Suzanne, two months doesn't make a trend. But clearly these numbers, they're not great, especially when you go ahead and compare them to how the numbers looked in 2013. You look at those numbers and the job gains actually topped 200,000 for many months during the year. December, boom, dropped like a rock though. January picked up, but, still, these numbers are really weak that we got today, especially, once again, when you compare them to the gains of 2013. Plus, here's what's interesting when you look at today's report. There were job losses in the field of health care. They weren't huge, only 400, but here's why it caught our eye. It's because the health care sector is usually considered recession proof because people always need to go to the doctor. You know, this is the first drop also in health care jobs in 11 years. So, I guess to put -- to put a summary on the January jobs report, it's a disappointing report. Definitely a miss. No one really feels thrilled about the numbers that came out.

Suzanne and Michael.

HOLMES: OK. But then we turn around and we look at the monitor over there and I see green arrows on the Dow. Explain, you know, disappointing jobs report with green arrows. It relates to tapering and the like, doesn't it?

KOSIK: Yes, and you -- it's exactly what it's about and it's that skewed way that Wall Street thinks that bad news is good news, at least these days. Because what these lackluster numbers could mean it that it might give the Fed reason to hold off on pulling back on stimulus.

Now, what the Fed just recently started doing was pulling back on the billions of dollars that it's been pouring into the economy, started doing that in January, because indicators, data, were all looking better. Well, now, it's not such a sure thing. You know, we're seeing these small gains. Corporate profits, they aren't anything to write home about. Overseas economies are slowing.

But you look at what's going on today, there's really just not a lot of conviction on Wall Street, even though you're seeing the Dow up 97 points.

MALVEAUX: Yes.

KOSIK: Not a lot of conviction in the buying. You've definitely seen the market waffle around from positive to negative territory. What it really shows is that investors are uncertain about this report -- this report and -- but one thing is for certain, you can expect more volatility, at least in the near term, Suzanne and Michael.

HOLMES: (INAUDIBLE) around about Wall Street where bad news can be good news.

MALVEAUX: Yes, only one place where that happens.

HOLMES: That's how they roll.

MALVEAUX: Thank you, Alison.

HOLMES: Good to see you, Alison.

MALVEAUX: All eyes on Russia, the opening ceremony of the Winter Olympics happening right now in Sochi. And what we're seeing are some of the first images of this much-anticipated event. We've been talking about this for weeks now. And, of course, you know, it's lavish, as always, featuring the introduction, the opening ceremony, the athletes, showcasing even Russian classical music. These are just some of the snapshots from this morning.

HOLMES: Yes. No, it's great. It's been going on for a little bit under an hour now. Fears, of course, have been about the terror strikes. There's been the controversy over gay rights, homophobic laws and the like. There's been allegations of government spying and ridicule over the country's readiness.

Now, they have to, a little way, overshadowed the games until now, but, you know, let's bring in Nick Paton Walsh in Sochi now. You know, the American audience won't get to see the opening ceremony until tonight.

MALVEAUX: Later. (INAUDIBLE).

HOLMES: On tape delay. What strikes you most? I mean it's all going on behind you. I'm sure it's frustratingly close. You can hear it, but you can't see it.

NICK PATON WALSH, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, I mean, I think the thing that struck out most and it was sort of trailed (ph) beforehand was tATu, the all-female group, the duo, who came out in the warm-up show. They came out holding hands.

They were known about a decade ago, came to a prominence because of a lesbian kiss they did in a music video using the sort of fake lesbianism, in their case because neither of them are gay, as a way of attracting attention back then. They came on stage and I think that perhaps may have been meant to some sort of stop (ph) to those critics of the pretty stringent homophobia here in Russia. Some of it backed by state legislation.

But I have to say, when you're watching that ceremony, the key thing that almost gets you is the Russian national anthem. I have to say, I think that's one of the most remarkable ones in the world at the end of the day. Plus also we've seen it go on now and after watching Beijing in 2008, the real sense of your jaw dropping going, wow, it was quite something. Not trying to be mean here, but I haven't quite had that sense while watching this ceremony just as yet. Bear in mind, the price tag, Michael and Suzanne, $51 million. What are we seeing just (ph) in the last hour?

MALVEAUX: Yes, that was pretty hard to top, the last one. Tell us a little bit about the reports now of Russia spying on journalists, even in the bathrooms. That people are watching what they do.

WALSH: Well, I mean, to be honest, people who've lived in Russia aren't enormously surprised. Perhaps it's those in the U.S. at the moment that you do occasionally come under electronic surveillance. But this is all bound to a report in "The Wall Street Journal."

Their reporter asked the deputy prime minister, Dmitry Kozak, about something he made a comment about how their surveillance cameras had shown that journalists, in one case, had left the shower on in the hotel room he was in, pointing at the wall, and then went out for the day. And then, obviously, they said, what are you talking about? What surveillance camera in what bathroom for what journalist?

That's, then, been denied by Russian officials. It may have been a slip of the tongue, but at the end of the day, people who have lived and worked in Russia for a long period of time end up kind of eventually getting used to the concept of surveillance somewhere and there's no proof that was the case here.

But, of course, the Russians have said quite clearly and it's in the State Department's travel advice to Americans coming here, you know, they are monitoring communications here to increase security. So if you come here, don't necessarily expect that much electronic privacy.

HOLMES: Yes, don't do your online banking perhaps certainly not over an unsecured router. What about security generally? We know all about the presence there. Any more details? I mean we had -- we had Senator Feinstein saying people visiting Sochi should watch their backs. I mean what are you hearing there?

WALSH: Well, I mean, this opening event has, at this point, it seems, passed as far as we know now without any real incidents. You're hearing sirens behind me. We've had helicopters swirling all around while it was happening. And I do think they possibly managed to get through without anything necessarily happening at this point as far as we know.

Now, the key thing is, what's all this talk done for attendance? I spoke to one American tour operator. He said, quite simply, and it may be because of this background chatter about safety, he's now finding himself with 1,000 tickets that were allocated to him to sell to Americans that he's got to shift pretty quickly because there simply aren't enough American tourists coming here to fill that for him.

He's also saying of his guests, 250 of them are actually family members of athletes and only 50 are, in fact, fans. And that kind of rings out with what we saw this morning going around near the venues. Not a lot of international fans. Of course, it's early stages. That doesn't mean it's a full picture. People looking to see if they'll show up in the days ahead.

Suzanne.

MALVEAUX: All right, Nick Paton Walsh. Thank you very much, Nick. We appreciate it, as always. Looking forward to seeing the opening ceremonies this evening.

HOLMES: Yes. There were tickets -- good tickets available right up to the start. They couldn't get rid of all the tickets, so I - it's going to be interesting to see how many people are in there.

MALVEAUX: Yes, because of security concerns. Yes.

HOLMES: Yes. Yes. A lot of people worried about it.

MALVEAUX: We'll be watching.

HOLMES: Yes. MALVEAUX: The games finally beginning.

Here's more on what we're working on for AROUND THE WORLD. Profanity allegedly used by a top U.S. diplomat was leaked online, but everyone's wondering actually how did this private conversation get out in the first place.

HOLMES: Also a drug bust in the ocean worth more than $600 million. Look at that pile of heroin. We'll tell you where it happened and who got it, ahead.

MALVEAUX: And, you're looking at a dog the Taliban claims it captured during a raid by U.S. forces, but the U.S. military has a different story.

(COMMERCIAL BREAK)

MALVEAUX: This just in. We got some breaking news here. Very little news, but this could develop into something. We are learning now Turkish Airlines sending a hijacking signal that's being held on the ground. It's a Pegasus Airlines flight that is being held in a safe zone, we're told, at Istanbul's International Airport in Turkey. This is after it sent a hijacking signal and this is according at least to the Turkish state media.

HOLMES: Yes, this was a flight apparently that was going from Kharkiv to Istanbul. Kharkiv is in Ukraine. Gave this signal, then landing at the airport. The airport is the Sabiha Gokcen Airport, which is the main international airport in Istanbul. And apparently it's sitting out there in this safe area. We're keeping an eye on it. We'll bring you more developments as we get them.

MALVEAUX: All right, the U.S. State Department is still saying nothing about what they call a private conversation that actually made the Internet.

HOLMES: Victoria Nuland, she's a top U.S. diplomat to Europe. And, guess what, according to a recording that hit the web, and it certainly sounds like her voice, a few days ago she was expressing frustration on the phone with the ambassador to the Ukraine, the U.S. ambassador, talking about the European Union and using, well, some salty language. Here's Elise Labott.

(BEGIN VIDEOTAPE)

ELISE LABOTT, CNN CORRESPONDENT: On the eve of the Sochi games, U.S./Russia relations hit a major snag. Russia now accused of leaking this private audio recording between U.S. diplomats discussing what to go about the current political turmoil in Ukraine.

VICTORIA NULAND, ASST. SECY. OF STATE FOR EUROPEAN & EURASIAN AFFAIRS (voice-over): So that would be great, I think, to help glue this thing and have the U.N. help glue it and, you know, (EXPLETIVE DELETED) the EU.

GEOFFREY PYATT, U.S. AMBASSADOR TO UKRAINE: No, exactly. And I think we've got to do something to make it stick together because you can be pretty sure that if it does - if it does start to gain altitudes, the Russians will be working behind the scenes to try to torpedo it.

LABOTT: That sounds like assistant Secretary of State for European Affairs Victoria Nuland telling the U.S. ambassador to Ukraine that they were going to bring in a U.N. envoy to close the deal because of U.N. inaction and indecision.

NULAND: (EXPLETIVE DELETED) the E.U.

LABOTT: That audio, first posted on YouTube with Russian subtitles and tweeted by a Kremlin official is highly embarrassing for the U.S. Nuland wouldn't confirm the authenticity of the tape, but she didn't deny it either. Instead, this veiled swipe at Russia suggesting Moscow recorded the call.

NULAND (on camera): I'm obviously not going to comment on private diplomatic conversations, other than to say it was pretty impressive tradecraft. The audio was extremely clear.

LABOTT: Even after NSA revelations of U.S. wiretapping of foreign leaders, the State Department called the publicizing of the call a new low for Russia.

The months-long protest in Ukraine to oust that country's president have divided the U.S. and Russia, with both accusing the other of meddling in the volatile situation, attention now fully on display thanks to a Russian tweet of a YouTube link.

(END VIDEOTAPE)

HOLMES: Elise Labott joins us now from Washington.

You know, I think, you know, F-bombs, the U.S. talking about the E.U., that probably goes on a lot in the diplomatic world. I'm sure the E.U. said many things about the U.S.

But the point is here about the -- it being released like this. Not even about the surveillance, the U.S. can't throw stones at Russia about surveillance after what's been going on.

LABOTT: That's right. It doesn't really have a leg to stand on, but it does kind of bolster their argument, you know, that everybody does it, Michael.

HOLMES: Yeah, yeah.

MALVEAUX: Well, is anybody really upset about this?

We were kind of joking. You know, be in the newsroom you might hear a few things there. I mean, are they taking this seriously?

LABOTT: Well, German Chancellor Angela Merkel came out with a statement today calling the comment unacceptable.

The State Department at least publicly doesn't seem overly concerned about it. It's embarrassing to be sure, but it doesn't seem to be indicative of a major disagreement. The U.S. and the Europeans pretty much on the same side here; they both prefer the Ukraine integrated with Europe over one closer to Russia.

HOLMES: Yeah, and in those circles, too, I'm sure salty language is the norm in those circles.

LABOTT: All the time. All the time.

HOLMES: But how concerned are they that this get leaked? It's not -- we've heard about U.S. surveillance on foreign leaders, but it's like they were releasing the audio.

LABOTT: Well, it kind of reminds me of Wikileaks, you know. Some of these cables and calls and stuff were leaked. They were embarrassing, but they got over it.

But it does make you wonder. It seems as this was done over maybe a cell phone and why -- there wasn't any classified information really in, but why diplomats are using cell phones for sensitive calls of this nature, and that's certainly something the State Department needs to answer for.

MALVEAUX: Yeah, and, Elise, so far they're staying mum. Do you think there might be an apology or they're just going to kind of hope this thing goes away a little bit?

LABOTT: Well, Nuland did apologize to her counterparts, and I think they'll probably just kind of eat it and ready to move on, because they have important stuff.

But I think it does reflect a little bit of a frustration on the part of the U.S. sometimes. They're looking for the U.N., E.U. to be much tougher on Ukraine, threaten types of sanctions against the president if the government doesn't form this larger national unity government.

So, I think that's the issue they're going to try to get a hold of and move past this embarrassing incident.

HOLMES: OK, Elise, thanks for that.

MALVEAUX: Thank you.

HOLMES: Elise Labott, I'm sure the language isn't the issue. It's releasing the audio like that.

MALVEAUX: Exactly. There's no trust there.

HOLMES: Yeah.

MALVEAUX: We've got this. This is a small humanitarian breakthrough in Syria today.

There are some civilians who are actually being evacuated from the war-torn city of Homs, which has been under siege now for years.

Now, these evacuations, they come under a cease-fire agreement that was announced by the rebels and the Syrian government.

HOLMES: Now, it also allows food and medicine to arrive in the city for the first time in more than a year, a city where people are said to be starving in some cases. The Syrian conflict has taken the lives of more than a hundred-thousand people, created millions of refugees, both external and internal.

Today, the government said it will participate in a second round of peace talks in Geneva, but we know that the first round did not go anywhere.

MALVEAUX: In Australia, a massive drug bust at sea, the navy found more than 700 pounds of heroin on a ship off the coast of Tanzania.

The navy team tested the substance, took some samples and then destroyed the remainder of the drug. And the street value of the heroin estimated to be $630 million.

HOLMES: They look pretty proud of it there, photo-op.

Now, Vice President Joe Biden slamming New York's LaGuardia airport. A lot of people agree with him. But is he being fair?

MALVEAUX: His comments and some comparisons AROUND THE WORLD, straight ahead.

(COMMERCIAL BREAK)

HOLMES: All right, continuing to get more information on this Turkish airliner, reports that a person made a bomb threat tried to get the plane diverted to Sochi.

We want to go to Nick Paton Walsh. Nick, what have you learned? There's not a detail at the moment. Tell us what you know.

NICK PATON WALSH, CNN SENIOR INTERNATIONAL CORRESPONDENT: It's very preliminary information right now, Michael.

What we do know is that an aircraft that was heading Kharkiv, which is an industrial town in eastern Ukraine, bound for Istanbul, according to our affiliate CNN Inter, whilst that plane was in the air a man on board, said at this point to be a Ukrainian national, said that there was a bomb on board the plane and he asked that instead the plane land at the Sabiha Gokcen Airport on the Asiatic side of the city of Istanbul, but instead it be diverted Sochi.

Now, I should make clear at this point, according to Turkish officials, that plane has now landed in Istanbul, is in a safe zone in the airport and the bomb threat is now being investigated by security forces. One would presume from that that the 110 passengers on board are off and safe.

We don't quite know where this originated from, what the motive was. Lots of things happen in midair that could be explained simply by erratic behavior. But, of course, people extraordinarily on edge at this point because of what's been happening behind me, coinciding precisely with that opening ceremony.

Michael?

MALVEAUX: Nick, do we have a sense of the person who actually allegedly made this threat?

Do we know if they are in custody at this point? What do we know about that individual?

WALSH: I'm only able to presume that, given the statement from the transportation official, the Turkish transportation ministry, the this person is presumably in some form of custody now, because the aircraft is in a safe zone at the airport.

Airports often do that. They have a place waiting set aside where any plane in any condition can be put down. This plane emitted a hijack signal while it was in the air, according to multiple reports. And that's, of course, where this process began.

Then it finally landed in Istanbul and the fact that it was able to make that landing suggests quite likely that the people on board didn't take either the threat that seriously or weren't necessarily concerned enough to divert their course.

They still managed to finish their journey and land in Istanbul itself, Michael.

HOLMES: All right, OK, yeah, Nick, let's turn now if we can -- thanks for that, Nick Paton Walsh.

Richard Quest is in New York. Richard, you're sort of our transport expert among many other hats that you wear.

What normally is the procedure when something like this happens and a plane lands as it did in Istanbul?

RICHARD QUEST, CNN CORRESPONDENT: The first thing, of course, is that pilot will send out a code, a transponder code, that will alert the ground and air traffic control that there is an abnormality.

And there are a variety of different codes that they can use. In this case obviously the one that was used was for a hijacking.

Any air traffic controller seeing that -- and the reason they do that, of course, is that it's a way in which the pilots can let the ground know without making it very overt that something's happening on board.

You literally just send out an electronic signal and the ground is alerted.

Once that has happened, procedures go into place. In some cases. military aircraft will be scrambled to get as close as they can to see that which is happening, you know, visual contact. There is no better substitute than eyes looking at planes to see what the situation is.

And then you've got the situation, where is the plane going to land? Many countries have specific airports, the U.K., for example, sends planes to Stansted in these situations, where they already have a well-honed plan.

They know where the -- what you don't want is uncertainty. So, the plane lands in Istanbul in this case. Everybody knows where it's going to be sent to. Everybody knows which part of the airport it's going to be in.

The security forces will know how to treat the aircraft in that environment, how to get passengers off. If an attack is necessary, it will be much easier in a known quantity.

Now, we don't know enough details about this. I'm just giving you the architecture, if you like, of how these are handled.

But it is a very well-planned, programmed, rehearsed program that swings into operation the moment a pilot signals the transponder for hijack.

MALVEAUX: And, Richard, if they go ahead and they press that button, the hijacking signal, to alert people about what is happening, how much information can they give folks on the ground? Can they alert --

QUEST: Very little.

MALVEAUX: -- officials that -

QUEST: Very little.

MALVEAUX: -- there might be a bomb threat or if there's more than one individual? Or is there any way of communicating on the ground more details?

HOLMES: It's just a code, isn't it?

QUEST: It's a code basically. But you do have ways, of course. You have digital ways of communicating with the ground. You have the passengers at the back who may still be able to use their cell phones. You have radio transmissions.

But we're talking here about the barest information. And the reason you may want to give this information, not only because you're going to want help to sort out this situation, but you may be flying an aircraft that is now going to start making erratic movements.

You may be deviating from your flight plan. If you've got, I mean, let's -- this is just in the realms of what can be. If you had a gun or a weapon to your head and you suddenly had to stop flying a different flight plan that was intended, that would set off all sorts of alarms and alerts.

And what you would be saying to the ground is, you know, this plane is no longer flying a normal flight plan under controlled circumstances as expected. Everybody beware. Keep an eye out. And then eventually you'll be given the information you require from where you need to go.

HOLMES: Right. And that does sound like it was the destination. This was going to Kharkiv to Istanbul for the destination.

QUEST: I'm guessing -- I'm with Nick on this one. You know, from what I'm hearing and what we've heard this is at the lower, lower level.

MALVEAUX: Yeah.

HOLMES: Yeah.

QUEST: This is way at the lower level of incidents, but --

HOLMES: Got to agree.

QUEST: -- I can promise you this. I can promise you this. The air traffic controller that got the hijacked transponder certainly wasn't taking it for granted.

HOLMES: Absolutely. Yeah, Richard Quest, thanks so much.

Yeah, apparently an F-16 was scrambled. This place, Kharkiv, it's the second largest city in Ukraine, so it's a regular route apparently from there to Istanbul.

So, anyways, looks like it's under -- all in hand.

MALVEAUX: Yeah. When we get more information, of course, we'll bring that to you.

We're going to take a quick break first.

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