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NEW DAY

Arctic Blast Sends Temperatures Plunging; U.S. Weighs Full Afghan Withdrawal; Will Arizona Governor Sign Bill?; Big Drop in Childhood Obesity; Minimum Wage Vote Delayed; Report: Credit Suisse Hid Billions From IRS

Aired February 26, 2014 - 08:00   ET

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


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REPORTER: How would you describe this winter?

UNIDENTIFIED FEMALE: Horrific.

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CHRIS CUOMO, CNN ANCHOR: Freeze, thaw, repeat. Another arctic plunge freezing out two-thirds of the country, many set to be stuck below zero for the rest of the week and the price of staying warm is getting people hot. We're going to tell you how high heating bills may go.

KATE BOLDUAN, CNN ANCHOR: Cloak and dagger banking. The stunning details of a senate investigation into a major bank. How clients kept their cash secret, money hidden in pantyhose, transported in secret elevators. The details you have to hear to believe.

MICHAELA PEREIRA, CNN ANCHOR: Living a mystery. New details on that polio-like illness that's paralyzing children in California. One of the families joins us live. Has going public helped find new clues to what's causing that disease?

CUOMO: Your NEW DAY continues right now.

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ANNOUNCER: This is NEW DAY with Chris Cuomo, Kate Bolduan and Michael Pereira.

BOLDUAN: Good morning and welcome once again to NEW DAY. It's Wednesday, February 26th, 8:00 in the East.

This morning, millions of Americans are waking up saying brr and facing a very cold reality. Right now, subzero temperatures are numbing the Midwest and the Northern Plains. A massive arctic blast sending temperatures plummeting once again 20 to 30 degrees below normal in the eastern two-thirds of the nation and millions are going to see more snow today. We'll get to Indra Petersons and the severe weather forecast in just a moment but first, let's get back to Ted Rowlands freezing it out in bitter cold Chicago.

Good morning once again, Ted.

TED ROWLANDS, CNN CORESPONDENT: Good morning, Kate.

It is freezing. We're about 15 degrees below zero with the wind chill it's much worse in other areas of the Midwest.

Bottom line: most people, you can imagine have had enough of this miserable winter.

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ROWLANDS (voice-over): The latest arctic blast is a harsh reminder that the winter that just won't quit isn't over.

UNIDENTIFIED FEMALE: Disgusting, too long, too cold.

ROWLANDS: Cities across the country are nearing record levels for snow and low temperatures. Rochester, Minnesota is on track to break its record of 52 days below zero. Chicago which many people are calling "Chiberia" has been below zero for 23 days this winter and it's 68 inches of snow is the fifth highest of all time.

In the South, Dallas and Atlanta are experiencing top ten coldest winters on record. It's the same for snow fall in Philadelphia and New York City. There's so much ice on the Great Lakes, there's concern the shipping season may be delayed.

In Illinois, the Kankakee River has massive ice chunks stacking up dangerously high, closing bridges and creating the potential for severe flooding.

SGT. DAVID ZINANHI, EMA DIRECTOR: We don't want it all to break at once. That won't be good.

ROWLANDS: Local governments are spending millions on snow removal and un-patching pot holes. Millions of us are expected to be hit with massive heating bills heating oil, natural gas and propane are all in demand.

Con Edison says customers in New York should expect a 16 percent increase on their February heating bill from the same time last year. While customers in Michigan will see a 13 percent increase. In Illinois, it could be as high as 30 percent.

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ROWLANDS: Which is absolute insult to injury. Chris, the worst part about this: it's not going to warm up any time soon. The rest of the week most states in the Midwest are going to be at least overnight below zero. CUOMO: All right, Ted, thanks for being out there for us. Obviously be on gouge watch to make sure nobody is taking advantage of the situation unfairly.

Let's get over to meteorologist Indra Petersons.

And please be generous, how long will this last?

INDRA PETERSONS, AMS METEOROLOGIST: Unfortunately, right now, we're talking about for at least a week. I want to show you something. This is a new experimental misery index. Let's talk about how bad this winter has been. Detroit, according to this misery index, which accounts for snow and cold temperatures, the worst on record. Chicago, the fifth worst. Top five Indianapolis, Philadelphia and New York.

And this is from a week ago. We haven't got the latest numbers. We add this latest cold snap. And, yes, unfortunately it looks like those numbers will move up a little bit on the roster.

Why? You know, it's cold out there. Look at these temperatures with the wind chill Indianapolis right now feels like 12 below. Duluth, 33 below, as you're trying to make your way outside. Even New York City feeling like 17.

So, definitely a difficult day, when the afternoon highs are 20, 30 below average -- Chris or Kate.

BOLDUAN: Thanks so much. Thanks so much, Indra.

We have major developments to talk about regarding Afghanistan. Defense Secretary Chuck Hagel has now arrived in Brussels for a NATO meeting where the future of Afghanistan is expected to be topic number one, now that President Obama has told Hamid Karzai all U.S. troops will be pulled out by 2014 if Karzai doesn't sign a security agreement.

CNN's Barbara Starr is at the Pentagon with the very latest.

We've been following the back and forth of this BSA as we've been talking about, Barbara. So, what is the latest?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Kate, you know, President Obama coming out really in front of the world yesterday, saying the U.S. will, indeed, pack up and go, take all of its troops out of Afghanistan by the end of the year if Karzai does not sign this bilateral security agreement. This is essential, legally essential for U.S. troops to be able to stay.

The U.S. plan had been to keep about 10,000 troops in Afghanistan. There's about 33,000 right now. Have that smaller force be able to train, advise Afghan forces, help them with counterterrorism operations against al Qaeda and the Taliban.

But Obama making it clear he's very much prepared to order the Pentagon to pack up and leave Afghanistan, and that may become a security problem in the region if that hand is forced. Leaving Afghanistan will make it very difficult to keep an eye on al Qaeda and the Taliban in the region and even keep an eye on them across the border in Pakistan, Pakistani officials already sounding the alarm that they worry civil war in Afghanistan could break out -- Kate.

BOLDUAN: And, Barbara, how does the upcoming presidential election in Afghanistan play out in this?

Karzai is not about to run again. But what about the new president?

STARR: Well, that's one of the big additional "ifs" in all of this, one of the open questions. The election in Afghanistan for a new president just a few weeks away. If that new president, whoever that may be, is willing to sign the agreement, the U.S. says OK, they will rethink all of this and see what they can do about keeping that smaller force, staying in Afghanistan.

But Afghan politics, even more complicated than U.S. politics, it is widely expected there may be one or even more runoffs after the presidential election. It could be some time before a new president in Afghanistan is even installed in office -- Kate, Chris.

BOLDUAN: Barbara, thank you.

CUOMO: All right, Kate.

Let's go to Arizona now where the controversial right to refuse service bill is on Governor Jan Brewer's desk. The question, will she sign? She's meeting today with people on both sides of the debate. Overnight, she tweeted that she would, quote, "do the right thing", unquote, for Arizona.

Supporters of the bill say it's about protecting religious freedom. Critics argue it discriminates against gays, lesbians and potentially others.

Ana Cabrera is following developments for us from Phoenix -- Ana.

ANA CABRERA, CNN CORRESPONDENT: Good morning, Chris.

We're at the state capitol quiet here this morning but this courtyard behind me is expected to fill with protesters as this day goes on.

No word just yet on when the governor plans to make a decision, but we have talked to a number of state lawmakers who say they have meetings scheduled with the governor today -- also expected to meet with business groups, many of which are urging her to veto this bill.

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CABRERA (voice-over): The voices are growing louder against a bill that would allow businesses in Arizona to refuse service to gays based on religious beliefs. The bill's fate now in the hands of Governor Jan Brewer. GOVERNOR JAN BREWER (R), ARIZONA: I don't rely on whole lot on my gut because I have to look at what it says and what the law says and take that information and do the right thing.

BREWER: Brewer is staying out of the spotlight since her interview with CNN on Monday. But other high profile politicians are weighing in as pressure mounts on the governor. Mitt Romney tweeting, "Veto of SB-1062 is right."

Big businesses including Apple, American Airlines, AT&T, and Intel vocally opposing the bill, and next year's Super Bowl also on the line.

(on camera): Do you think that the governor's getting the message?

UNIDENTIFIED FEMALE: She hasn't said a whole lot.

CABRERA (voice-over): Conservative lawmakers who helped pass the bill remain largely quiet.

UNIDENTIFIED MALE: No comment right now.

CABRERA: But one representative defended his vote by offering an example of what the bill is designed to prevent.

REPRESENTATIVE SONNY BORRELLI (R), ARIZONA: You have a gay person that owns a printing shop, OK. Somebody from the Westboro Baptist Church comes in there and demands that they print and sign that, obviously the printer is not going to agree with. Should that religious group demand that print shop print that thing?

CABRERA: Conservative radio host Rush Limbaugh igniting the rhetoric by saying Brewer is being attacked.

RUSH LIMBAUGH, CONSERVATIVE RADIO HOST: The governor of Arizona is being bullied. She's being bullied by the homosexual lobby in Arizona and elsewhere.

CABRERA: Protesters vowing to continue the fight. We want the Super Bowl. We want Apple and we're really asking our governor please do the right thing and veto this SB 1062.

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CABRERA: Right now, no one knows for sure what the governor is going to do but we do know she's vetoed similar legislation last year. We also know that she really prides herself on being pro-business and there's a lot of concern about what this bill could do for business here in the state of Arizona from its potential impact in attracting new businesses or new talent to the state, to its impact on tourism industry.

And yet, this governor also hasn't shied away from signing controversial legislation in the past either. So, the state lawmakers we've talked to say it will be a while before the governor makes her decision -- Chris, Kate. BOLDUAN: We know some big businesses are definitely speaking up at this point.

Ana, thank you very much.

U.S. appears to be gaining ground in the fight against childhood obesity. Some good news with new data suggesting obesity is down a whopping 43 percent in children between ages of 2 and 5 in the last decade. It's a promising sign as doctors look to prevent bad trends right at the time kids develop eating habits that can last a lifetime.

CNN's Joe Johns is taking a look this.

Good morning, Joe.

JOE JOHNS, CNN SENIOR WASHINGTON CORRESPONDENT: Good morning, Kate.

The good news this is the first time researchers have seen a significant drop in obesity in one of the age groups in the general population, however, still has a long way to go.

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JOHNS (voice-over): This morning, a big step forward in the battle against childhood obesity. A new study using federal data says obesity in children between the ages of 2 and 5 has dramatically decreased, over 40 percent in a decade. While exact reasons are unclear, experts say it's a promising sign.

DR. THOMAS FRIEDEN, DIRECTOR, CENTERS FOR DISEASE CONTROL AND PREVENTION: There's increased attention to improving childhood nutrition. There is increasing breastfeeding rates. Child cares are doing more physical activity.

JOHNS: This report comes out just as the first lady's let's move program to improve kids' fitness levels and eating habits marks its fourth anniversary.

MICHELLE OBAMA, FIRST LADY: Some folks even warn me that taking on childhood obesity might be controversial. They thought kids and parents should deal with these issues privately. Others laughed it off as not a real issue at all. Well, four years later, that all seems like ancient history.

JOHNS: And now, there's a new push. The administration is proposing rules to stop marketing products in schools that the government says are not good for kids. Companies would no longer be allowed to use logos of high calorie products such as regular soda on cups, vending machines, or posters.

OBAMA: And as part of this effort, we'll be eliminating advertisements for unhealthy food and beverages in our schools, because I think we can all agree that our classrooms should be healthy places where kids are not bombarded with ads for junk food.

JOHNS: Which could mean a change to the iconic soft drink-sponsored schools sports scoreboards that pop up almost everywhere. That's sure to fuel complaints of some "Let's Move" critics who say government needs to back off when it comes to what we eat and drink.

DAREN BAKST, THE HERITAGE FOUNDATION: It's no longer father knows best or mother knows best. It's what government knows best and that's really the problem here.

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JOHNS (on-camera): And an answer to that nanny state question, the administration says it distinguished between adults and children and that the "Let's Move" program defers to local controls some local officials. But they also say government has an obligation to try to assure that the foods and drinks served in schools are healthy -- Michaela.

MICHAELA PEREIRA, CNN ANCHOR: All right, Joe Johns. Thanks for looking at that for us. Let's take a look at more of your headlines. Quarter past the hour.

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PEREIRA (voice-over): Four options are now being weighed by the White House for revamping the NSA's phone surveillance program. According to the "Wall Street Journal," three of those options involve running all the data through outside entities including the phone companies or other government agencies like the FBI. The fourth choice, to abolish the program completely.

Senate Democrats pushing back on a vote on raising the minimum wage. Majority Leader Harry Reid is blaming Republican obstruction for jamming the Senate calendar. He now expects the vote to happen in late March or sometime in April. The bill raises minimum wage to $10.10 an hour and links future hikes to the inflation rate. Democrats likely didn't have the 60 votes they needed to avoid procedural hurdles anyway.

In India -- oh, not to India. We'll go to President Obama. My bad. President Obama is in Minnesota today. He'll be at the St. Paul Union Depot talking about job creation and launching a competition encouraging investments to restore crumbling roads and bridges. Vice President Biden was in Minnesota last week to meet with people who signed up for Obamacare on the state exchange.

Now to India where officials are hunting for a wild leopard. It has been prowling around the city there in New Delhi, broke through a window to get free, managed to escape a hospital where it was cornered and was later seen in a movie theater and an apartment complex. Efforts to corral the animal have been slow because people are crowding around it. In fact, several -- seven onlookers were hurt when the leopard got spooked.

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PEREIRA (on-camera): Our next story speaks a lot about current trends. We know the beards are very popular today. What do you do if you can't grow one? Well, you get a beard transplant.

CUOMO: What?

PEREIRA: A prominent New York plastic surgeon says he is now performing them about three times a week, taking hair follicles off other parts of the body, moving them to the face (INAUDIBLE) over that. The goal is that very trendy. Look, so of course, that made our producers wonder what we would look like with beards.

BOLDUAN: Wow!

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CUOMO: What I don't like is that you both look better than I do.

PEREIRA: No. You look good with a beard. I actually kind of like that.

CUOMO: That's a terrible beard.

PEREIRA: Kate, I think --

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PEREIRA: That looks like wolf's beard.

BOLDUAN: I'll take that beard.

PEREIRA: Yes.

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PEREIRA: Why am I so happy about it?

(LAUGHTER)

BOLDUAN: Yes. Why are we smiling?

PEREIRA: And I can't tell where my hair --

BOLDUAN: We're going to the circus, folks.

CUOMO: Where are they getting the follicles from?

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PEREIRA: Can we gloss over that part?

CUOMO: You must not have a lot of body hair --

BOLDUAN: You never know.

CUOMO: I can't grow a beard.

BOLDUAN: I know.

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BOLDUAN: We like your boyish good looks. OK. That was scary.

PEREIRA: Yes.

BOLDUAN: Coming up next on NEW DAY, we're going to be telling you, we've been telling you about the polio-like disease that's paralyzing some children on the west coast. Well now, we're going to talk with the family of one little girl who's been struggling with it and they're trying to help other parents. That's why they're speaking out. They want to tell parents what they need to look out for. What are the warning signs?

CUOMO: And we got some operation to tell you about that would make like the CIA or mission impossible proud. Secret elevators, taping money to bodies, but it's real. Did Credit Suisse help clients hide billions? We have the details coming up. I can't get over the beard thing.

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CUOMO: That's the right music. This is Bonds-esque. A scathing Senate report accuses Credit Suisse of helping wealthy Americans stash billions, hiding it from the IRS. It was allegedly quiet and elaborate scheme. Listen to this, money hidden in pantyhose, secret meetings in hotel lobbies, all with no paper trail. Fact or fiction. And if it is true, what can Congress do about it? Christine Romans is here to explain. Please do.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: It's everything that the rich people in novels love about the Swiss banking system, right? You know, the top brass at the bank are going to acknowledge this behavior. They're going to say it was a few bad bankers. They cleaned it up. But you guys, senators are furious that this went on for so long and that the U.S. government did not do more to stop it. No question today, we're getting a very good look at the lifestyles of the rich and greedy.

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ROMANS (voice-over): The numbers are shocking. According to the Senate investigation, up to the $12 billion was being held by Credit Suisse and about 95 percent of all that cash not reported to the IRS.

UNIDENTIFIED MALE: Only one percent of Credit Suisse's U.S. customers with Swiss accounts had been provided to the United States authorities.

ROMANS: But perhaps more shocking, how the bank and its clients are accused of pulling it off? Remember this scene from "The Wolf of Wall Street"?

UNIDENTIFIED FEMALE: We don't work for you, man.

UNIDENTIFIED MALE: Yes. My money -- ROMANS: These clients are accused of strapping their cash in even more inventive places, trying to get their money out of the U.S. and into the Swiss bank. Senator John McCain slammed the cloak and dagger practices saying --

SEN. JOHN MCCAIN, (R) ARIZONA: Some of the tactics that bankers used to help their U.S. clients evade paying taxes belong in a spy novel.

ROMANS: Among the alleged hiding techniques, a quarter million dollars stashed in pantyhose. The Senate report details a clandestine meeting in a fancy hotel where bank statements were exchanged hidden in a "Sports Illustrated" magazine. And investors pretended to be tourists, but instead, were smuggling in the cash.

Here at the Zurich airport, Senate investigators say the bank even set up a branch inside so that its customers could pop in and out easily. And like something out of James Bond, clients were transported in secret elevators, remotely controlled by the bank.

MCCAIN: It's pastime to fully and clearly expose how offshore tax havens, banks help American account holders evade paying their taxes.

ROMANS: Now, the Senate committee is trying to track the cash, asking the bank to hand over the names of those Americans hiding their cash with them.

UNIDENTIFIED MALE: The Department of Justice needs to use the tools in its arsenal to collect the taxes owed and to hold to account taxpayers.

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ROMANS (on-camera): All right. Credit Suisse is in the spotlight today, but there are other banks the U.S., and the senators are zeroing in on 14 of them. Here's what Credit Suisse says, "We acknowledge that the Swiss banking secrecy laws have historically been vulnerable to abuse and were, in fact, abused by U.S. taxpayers. But at Credit Suisse, we built a business culture where hiding income and assets of U.S. clients is absolutely unacceptable."

You'll have the top brass of this bank that will be there in front of those senators today. A scathing 175-page report. And also just infuriating, I think, for average American taxpayers who, no question, Uncle Sam manages to chase down every dime there, but that somebody who's super, super rich can drop off their millions --

BOLDUAN: What can Congress do --

ROMANS: -- a ski vacation in Zurich.

BOLDUAN: That's what I continue to wonder, though. What can Congress do?

ROMANS: (INAUDIBLE). But they're really going to be very difficult on the justice department, too. I think you're going to have senators really mad at the justice department that there's one standard for Americans and regular Americans and another stand for rich people.

BOLDUAN: Carl Levin has done a good job with that, the investigative committee that he has. Thanks so much, Christine.

ROMANS: You're welcome.

BOLDUAN: Take another break. Coming up next on NEW DAY, a medical mystery in California. Nearly two dozen children paralyzed by an illness that they say is polio-like. Is there any hope of recovery, though? We're going to talk to the family of a four-year-old girl right there who can no longer use her left arm. We're going to talk about what they want to make sure other parents hear.

CUOMO: And a victory for celebrities, but more importantly, their children. Major magazine agreeing to stop publishing unauthorized photos of celebrity kids. Will it stop? Will it even slow down the crush of the paparazzi? It's really up to you, isn't it? It's all about what you want to buy.

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PEREIRA: All right. Time now for the five things you need to know for your NEW DAY.

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PEREIRA (voice-over): At number one, temperatures are plummeting in the east. Two-thirds of the nation, there'll be 20 to 30 degrees below normal all week. Snow is expected in the east today, already falling, in fact, at the White House. Look at that.

New data shows big progress in the last decade in the fight against childhood obesity. A study show it's down 43 percent in children between ages two and five when eating habits can be established.