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Rescues by U.S. Coast Guard Helicopters; White House Warns On Price Gouging Following Harvey; North Korea Condemns U.S./South Korea War Games; J.J. Watt Raises Over $13 Million for Harvey Survivors; Aftermath of Hurricane Harvey Finds Texas Cities Lose Fresh Water, Hospital Evacuated. Aired 2-3a ET

Aired September 1, 2017 - 02:00   ET

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


[02:00:17]GEORGE HOWELL, CNN ANCHOR: Welcome to viewers here in the United States and all around the world. You're watching CNN continuing coverage, the aftermath of Hurricane Harvey. I'm George Howell live here in Houston, Texas, 1:00 a.m. this hour here in Houston where the traffic behind me here in this convention center that is the shelter for so many people -- the traffic is settling down.

People trying to figure out what they will do tomorrow but again try to get a good night sleep tonight at the very least.

Let's first talk about the very latest on the aftermath of the storm. The confirmed death toll as it stands now from Hurricane Harvey 47 people have been killed. Just six days ago since the storm, category 4 storm in fact, made landfall. More than 70,000 people have been rescued in one way or another and those rescues continue day after day after day.

Still an unknown number of people are stranded. People still waiting for help and complicating the situation is this, the loss of electrical power and even fresh water in some places. That's a big problem.

Just to the east of Houston, in Orange County, that area is under a mandatory evacuation order. Also to the east of Houston the city of Beaumont, Texas, in dire straits there. That city now without fresh water after its water pumps failed. The city has issued a boil water advisory to its 135,000 residents there.

Long lines formed outside store selling water and throughout the region prices were central things like food like water and gasoline. Those prices have skyrocketed. The loss of freshwater has forced the local hospital there to stop operations and to start the slow process of evaluating all of its patients and evacuating them to other facilities just a few people at a time.

(BEGIN VIDEO CLIP)

MARY POOLE, SPOKESWOMAN, BAPTIST BEAUMONT HOSPITAL: When we went to bed last night at midnight we were expecting business as usual. We're pretty self-contained. We have our own generators. We have plenty of food and bottled water. We had no idea when we went to bed at midnight that at 1:00 o' clock we would get the call that says the hospital would need to be thinking about the city's water being lost. We did not expect that and that's a game changer for us.

(END VIDEO CLIP)

HOWELL: A game changer here there and the loss of electricity, that has created another hazard. Fires and explosions at a chemical plant, right there, along the Gulf Coast. A volatile chemical that is known as organic peroxide. It's blamed for two explosions early Thursday in a facility in Crosby, Texas. The containers overheated when the cooling system lost power. 15 police officers were treated for smoke inhalation but all have been released at this time as we understand. Officials warned, though, that more chemical explosions are possible in the area.

The US Military has deployed more than 6,000 active-duty troops to help out in areas that have been affected by Hurricane Harvey.

I spoke earlier to Colonel Lieutenant -- rather to Colonel Steven Metze, I should say, about the work that they're doing alongside the Texas National Guard. Listen.

(BEGIN VIDEO CLIP)

COL. STEPHEN METZE, DIRECTOR, TEXAS MILITARY DEPARTMENT PUBLIC AFFAIRS: Search and rescue still by far our number one focus. We did a lot of evacuations today especially out Beaumont. We're also shifting a little bit toward critical life support. So points of distribution where the organizations provide food, water, supplies we're hoping get them there and help them get distributed in an organized way.

So that all is going on and is all that is happening we've set up different levels of command to push all that information back under the dual status command that we have running right now.

HOWELL: Do you feel like the infrastructure that's in place right now -- is it working or do you feel like there are things that you'll have to tweak her or change? As again we're learning so much more about the expansive destruction that's out there, the many people who are in need of help.

METZE: Well, we have 14,000 National Guards personnel that are activated right now. We've got 10,000 from other states that are coming in. They started coming in today. They'll be here -- all here within the next 48 hours. We've got 6,000 Title X troops. So when you put all that together, it's really amazing actually how well it is all working under the dual status command.

And I think what we're seeing is you've got equipment and you've got personnel pouring in from, you know, helicopters, fixed-wing aircraft, boats, high-profile vehicles. It's all rolling in and it is all working. I mean, we haven't turned down a single air mission. We've been constantly moving the entire time, constantly doing operations. And we, you know -- I can't say there won't be any lessons learned or any room for improvement, but it's worked very smoothly so far.

You have the same thing with coordination with our civilian counterparts. You know, if you look back years ago, that coordination was there and now it is.

[02:05:04] And so across the board, I say I think we're seeing an incredibly high level of coordination and partnerships under this command structure.

HOWELL: So you talk about what's happening now, the resources that are pouring in. And you guys, of course, the job is to be ready at any time. But talk to us about the long term because, you know, we understand from this storm, it's going to take some time, not weeks, not months, but possibly years, you know, to get Houston, to get the surrounding areas, you know, back to where they once were. How do you guys plan and project for the long-term?

METZE: Well, so, you know, we said that we are in it for the long haul. We are not slowing down until we're convinced that we've done everything we can to help the citizens of Texas. So nobody is -- you know, nobody is being activated for one or two days or for a week or for two weeks. We're looking at this at the very long term, however long the governor wants us here and thinks we are needed here.

We are planning for the long term. We're looking at rotations. We're looking at what we need to do to keep people working. We're 24/7 right now. But that's not something that is unfamiliar to the military, right. And 24-7 operations, we have -- you know, we have sleep plans, we have rotation plans.

So we're looking at being able to sustain this for the long haul. And we're not going to slow down until we're convinced we've done everything we can.

(END VIDEOTAPE)

HOWELL: All right. So that's the word from officials about how they're handling the situation. Sadly though some of people's worst fears are coming true in the aftermath of the storm. According to the White House flooding has either damaged or destroyed about 100,000 homes and many owners they don't have flood insurance.

Take a look at these satellite images from Digital Globe. They were taken before and then after the storm hit and really highlight just how widespread and devastating the damages these images include the flooded cities of Holiday Lakes, Simonton, Brookshire, Angleton, all of which are near Houston, Texas.

There are so many people who've lost so much here in the state. My colleague Alexander Marquardt met up with two men whose homes are now in ruins and he followed them -- they allowed him to follow them to the home to show him exactly how bad that situation is. Here's his story.

(BEGIN VIDEOTAPE) ALEXANDER MARQUARDT, CNN SENIOR NATIONAL CORRESPONDENT (voice-over): This is the first time that Bill Wolf has been able to get back to his house since being evacuated.

BILL WOLF, FLOOD VICTIM: Surreal is probably the understatement of the century here. You know, watching a 30-foot fishing boat drive down the street is like something that you've just never seen before. And I don't know, it's just crazy.

MARQUARDT (on camera): Well, see how high the water is, though.

WOLF: Yes. So, I mean, we'll see if I can even get in or not.

MARQUARDT (voice-over): Captain Kenny Evans is taking Wolf back.

CAPT. KENNY EVANS, RESCUING FLOOD VICTIMS: One minute you're stressed about your gutters and the next minute everything you have is ruined.

MARQUARDT: It was Evans who rescued the Wolf family along with their cat and dog in the middle of the storm on Monday. After navigating the boat to the door, we wade into the living room. Furniture now floating through past the pictures of his sons.

WOLF: I'm really proud of him. I'm really proud of him, my wife -- my family. They're tough little kids.

MARQUARDT (on camera): They're holding up?

WOLF: Yes, yes, yes. It's -- I'm not an emotional guy. I'm pretty calm, and this has been too much for me. To be honest, I don't know if I want to be here very long.

MARQUARDT (voice-over): Back in the office the real loss becomes clear.

WOLF: I got a 150-year-old family (INAUDIBLE) in this water.

MARQUARDT: Stacks of photo albums, baby books, and other sentimental items.

(On camera): Is this the worst part, the personal stuff?

WOLF: Yes. I mean, this is the stuff that you can't replace, right? This is my son's birthday in the household.

MARQUARDT (voice-over): Upstairs where it's dry, Wolf throws his sons toys and shoes into garbage bags.

(On camera): So you think there's a possibility you may never live in this house again?

WOLF: I don't know. Yes, I mean, it's going to sit here for a month or two. It's six-feet water so --

MARQUARDT (voice-over): Up and down this neighborhood, people taking stock of their belongings and their lives. 86-year-old Ed Wendler is also back for the first time. With Captain Evans, we found him on Monday in his dark bedroom, alone, with no power. He needs his medicine, so Evans heads inside past countless possessions now suspended in the dark floodwaters.

(On camera): This was Ed's office, all these papers piled high in his desk. You can see now they're totally ruined. The water here is so high, at the back there in the kitchen that the fridge is now floating on its side.

[02:10:03] (Voice-over): On the boat, Wendler tries to take it all in.

ED WENDLER, FLOOD VICTIM: This is very confusing. I can't get wrapped up in my mind. What is going to be next? What I'm going to need to do?

MARQUARDT: Wendler and Wolf are just of the countless people who Captain Evans has helped this week, and his work is far from over.

EVANS: It's not even really -- you see this stuff on TV, but this is total devastation in every way, physically, emotionally.

MARQUARDT: Alex Marquardt, CNN, Houston.

(END VIDEOTAPE)

HOWELL: Alex, thank you for the reporting.

People in Beaumont, Texas, are posting pictures to social media. I want to show you some of these images. Take a look at the long lines to buy basic supplies, things like food and water. People are getting to stores before sun up. Some bringing lawn chairs, in fact. Hunkering down for that long wait. In the meantime the scene in Dallas, Texas, very similar, though these lines are not for gas, not for food. These are long lines for gas, I should say.

Just look at that. You do get a sense of what's happening. Many people are rushing to fill their tanks. They're panicking over social media about supplies running low.

My colleague Alison Kosik has this report.

(BEGIN VIDEOTAPE)

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: If you're in Dallas you're going to run into one of two things. If you're looking to fill up your car, you're either going to find gas stations completely out of gas like the one across the street here, this Texaco fresh out of gas. Or if you're lucky to find a gas station that actually had gas, you're going to find really long lines like the one right here.

We actually ran out of gas with our crew car. We were on empty and we had to go around to at least four gas stations before we found a place that had gas and then had to wait 45 minutes. But that's nothing compared to what one driver told me he had to go through. He had to drive 35 miles just to find a gas station that had gas. And when he finally found it, he had to push his car to the pump because his car ran out of gas.

So why is this happening? Well, a couple of reasons. For one it's a distribution supply issue. The refineries in Port Arthur and Houston are not open. They're not refining their gas product. There's a lot of gasoline in storage tanks. But they can't get it to market. So it's a big distribution issue.

The other issue? News reports of this distribution problem going on social media. Lots of people posting on social media their concerns. That causing a lot of people to panic and a lot of people just to come out and drove all at once and try to fill up their cars with gas. The problem is a lot of gas station owners were not ready for it. And supply ran out very quickly.

Alison Kosik, CNN, Dallas.

(END VIDEOTAPE)

HOWELL: Alison, thank you.

The tropical depression that used to be Hurricane Harvey, it is moving inland, bringing potential floods to more states in the southeastern part of the country but now another weather headline to tell you about. There's another strong storm that's brewing in the Atlantic Ocean. Over the course of a day Tropical Storm Irma strengthened to a category three hurricane.

Let's bring meteorologist Derek Van Dam in the International Weather Center to tell us more about that.

Derek, so you've been here. You know the extent of the damage here. And as we understand it, you know, the models don't exactly say which way it's going to go but Texas is definitely a possibility. Yes?

DEREK VAN DAM, AMS METEOROLOGIST: Yes, that's right, George. As if one storm wasn't enough, we currently have three named tropical systems threatening or already are impacting North America. We've got Irma across the Atlantic. We've got Harvey over the southeastern U.S. and Tropical Storm Lydia impacting the Baja Peninsula in Mexico.

Let's talk about Harvey because that's the ongoing threat right now across the southeastern United States. Still a tropical depression and this storm continues to rotate across the western sections of Tennessee and Kentucky through a flash flood warnings but we still can predict what's taking place across southeast Texas and Louisiana.

Is this a major threat going forward. Still 25 gauges with and rivers at major flood stage, one of which we were reporting from, George and I actually 24 hours ago. This is the Brazos River at Richmond just west of the Houston region rising 43 feet since earlier this week. It's currently at record levels.

What I want you to notice is how it's stays at record levels for the next four days. It is going to take four days before this river even begins to start to recede. You can imagine the health concerns going forward as well. Now let's talk about the other system that we're concerned over the

Atlantic. This is Hurricane Irma. There are several computer models as George alluded to that we look at. One is a European model, one is an American model. Let me show you what the European model takes us to the end of next week makes a category four or category five hurricane right between Miami and Cuba.

The American model, this is just updated recently, still a strong category four hurricane as we look into the late parts of next week. The thing that we are hoping for, some of the computer models and ensembles that we actually look at have the system also veering off to the north and east across the open waters of the Atlantic.

[02:15:03] We can only hope and only pray that that is the one that actually materializes, George. But at the moment we still have the storm system looming over the next seven to 10 days for a potential US strike.

Back to you.

HOWELL: Derek is on top of it. Derek, thank you so much. We'll stay in touch with you of course.

Still ahead here on NEWSROOM this hour, the rainfall and flooding from this hurricane, it has been massive as Derek has even indicated. Up next, we take a look at how it compares to other storms around the world live.

You're watching NEWSROOM.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

MIGUEL MARQUEZ, CNN CORRESPONDENT: I'm Miguel Marquez in the east Texas city of Beaumont where the hospital here is evacuating all of its patients because the entire city, all 135,000 people in parts of the surrounding county are without water. The floodwaters from Hurricane Harvey has deluged their pumps here and they are unable to pump water. They have both failed and the city now is without water.

The hospital has been on a military-like mission to get the patients out. The most critically injured were moved to Dallas and Galveston and Jasper, Texas. One patient even moved to Missouri. Nine prematurely born babies were also moved out. They have about 85 patients left/ And they believe they will get them out in the next 24 to 48 hours.

(END VIDEOTAPE)

[02:20:02] HOWELL: A lot of damage to talk about. Miguel Marquez showing us the situation there.

The U.S. President Donald Trump will return here to the state of Texas on Saturday. He will see some of the damage from Hurricane Harvey first hand. But in the meantime his vice president, Mike Pence, just toured the areas hit by the storm. He visited Rockport, Texas, with the governor of the state, Greg Abbot, and even helped to clean up.

There are many organizations that are here available to help people in the Houston area. One of them called Somebody Cares. It's an international organization and earlier I spoke with its founder Doug Stringer and I asked Doug about his organization, how it was providing relief to so many people who need help.

(BEGIN VIDEOTAPE)

DOUG STRINGER, SOMEBODY CARES: We have been a part of these crises before. Katrina, Rita, and all over the world, of course, Ike right in our own city. But this is such an unprecedented storm and hurricane that we had to set up in greater Houston area in quadrants and people we've already been working with try to get fluid information, real-time assessments and to find out what the greatest needs were that we could begin to meet those needs together.

So we actually staged in Rockport and in Corpus Christi and throughout Houston and east Texas prior to the hurricane, and within hours we had some of our people from San Antonio and from Virginia down into Rockport staging there, feeding 4500 hot meals a day to first responders, to Mercy Chefs, churches in those areas have all worked together. We're sending them down 10,000 MyPillows that have been donated by the Lindell Foundation. Another 30,000 coming to the Houston area to help bring those with mattresses and other resources, water. food. And of course in stage two they're providing need cleaning supplies and all kinds of gutting out material as well.

So what's amazing is to see the narrative at this moment in the midst of adversity, so many people coming together, crossing racial, denominational differences, their personal and political differences and really it's neighbors helping neighbors. Otherwise there will be no way we could -- you saw the Cajun Navy. You saw so many. We have come together and not caring who gets the credit. We just want to see people helped and see people get back on their feet as soon as possible.

HOWELL: It's an amazing thing to see for sure. Tell us about how you guys are managing the fact that there are so many people that need help because the way you described it, your organization, it's pretty well spread out here throughout the region. But have you ever seen something like this? And are you able to keep up with it?

STRINGER: Well, it is a whole new scenario for us. But in the sense that we've done a lot of tsunamis and Indonesian tsunamis, Japan, Philippines, of course throughout here, tornadoes. But the uniqueness of the massive flooding has been so difficult to maneuver that people were stuck within their own areas.

The advantage we have is we have long-term relational equity across the country so when things like this happen, we can immediately find out from people on the ground. Those are going through things themselves to how to come and help them right away. For example, in south Houston, in Friendswood, Dickinson, in Alvin, in Pearland, they got dumped on initially. We were able to already have relationships there to find out what the greatest needs were each few hours, know what their needs would be.

In fact, just recently, when some of the churches had set up as transitional staging areas and shelters, then they had gotten flooded, we had to move people to Pearland High School. And then we're working with Salvation Army, working with Mercy Chefs, working with many, many other agencies that are coming together and really crossing their barriers. We really have to work together to see real needs being met in a tangible way.

Same thing up in the northeast side of Houston. We began to hear about churches, we said we will be a staging area. We'll be a shelter. One church up in the Alboking (ph), with the Atascocita area, when they were saying they would open up, they started opened as a shelter and didn't even realize the pastor himself, his house got flooded. He had to take actually kayaks to go rescue his own family.

(END VIDEOTAPE)

HOWELL: You do get a sense that are a lot of organizations that are out here, they are providing a lot of help and you know that help will be needed for quite a long time here.

Hurricane Harvey broke records in this state and across Louisiana soaking this region with historic amounts of rain. The amount of water dwarfs that from Hurricane Katrina and it's stacking up to be one of the worst storms in U.S. history.

For more on that my colleague Tom Foreman.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT: 45 million gallons every minute. That's how much water flows and were all the falls up at Niagara and yet they would have to run for 381 days to equal the amount of water that Harvey has dumped on Texas and Louisiana. Some experts now putting the total dump there at 25 trillion gallons, some say less but is it possible it can be that much?

[02:25:02] Well, look at the vastness of the area and you'll see how it might be. If you put us over in California it would stretch from Los Angeles up to San Francisco. Show it to the East Coast over here and you would have it going from Washington, D.C. to up above New York. And by comparison the worst tropical storm rainfall in California was 1976 Kathleen. What was that? Just under 15 inches over a much smaller area?

What about on the East Coast? That was New York in 2011, Irene a little over 13 inches, but look at Harvey. This massive amount well over 50 inches in some areas really high in other areas even if it wasn't that high. That's why all the records are being shattered here. And if you were to compare this to Katrina, for example, very different types of storms. Katrina had broken levees, all sorts of things like that.

Here is a comparison. A lot of New Orleans ended up flooded with somewhere between 10 to 20 feet of water. This is what 20 feet would look like next to me. If you took all of the water from Harvey and you compress it into a smaller area like this, it would completely engulfed buildings that were 12 stories tall. And bear in mind even when this water starts going away the danger will still be there because this waters in pristine is now been infused with petrochemicals and now with agricultural runoff and toxins from homes and businesses and raw sewage many, many, many threats out there even as the war drains off.

(END VIDEOTAPE)

HOWELL: A lot of water and a lot of it very dangerous.

Tom Foreman, thank you for that.

There have been some inspiring and incredible stories. Heroes have been risking their lives rescuing people from these floodwaters here in Texas.

Still ahead, we have an up close look at some amazing rescues that took place. Stay with us.

(COMMERCIAL BREAK)

0200 HERE

(COMMERCIAL BREAK)

[02:30:55] HOWELL: Welcome back to viewers here in the United States and around the world. Our continuing coverage on CNN of the aftermath of Hurricane Harvey. I'm George Howell, live in Houston, Texas.

The backdrop here, one of the city's evacuation centers, one of the larger centers. You see behind me only volunteers and police really out and about right now. But if you look at the other shot we have just behind where we are now, you see that the work continues around the clock, the sorting of donations to help people in need and the people who need here -- they need so much.

Let's get the latest on this storm that has now moved on. We now know the confirmed death toll stands at 47 people who were killed. A week ago, the storm made landfall as a category 4 hurricane. Since then, more than 70,000 people have been rescued or saved in one way or another.

So far, the storm has dumped an estimated 27 trillion gallons, again, 27 trillion gallons of water. That's about 102 trillion liters of rain on Texas and Louisiana. About 100,000 homes are damaged or destroyed from the storm. And federal officials say some 96,000 people have already been approved for emergency aid.

Rescues are the big story here in the Houston metro area. Helicopters have been flying for days now rescuing people stranded by the floods. My colleague, Anderson Cooper, spent time with a crew in a U.S. Coast

Guard chopper and witnessed lifesaving rescues.

(BEGIN VIDEOTAPE)

ANDERSON COOPER, CNN ANCHOR (voice-over): All day, the searching continues. Coast Guard pilots, Matt Mayer and Dan Miller, are flying low over the flooded streets. The flight mechanic, Eric Veragescos (ph), and rescue swimmer, Evan Gallant, look for anyone in need of evacuation.

(on camera): We've been flying over this area for about 20 or 30 minutes. They've just believe they have somebody who has been waving to them. It's confusing, though. They can't tell for sure if it is somebody who wants to be rescued or not. The rescue diver is ready to go down if necessary. But there's -- they're trying to figure out -- it's one of the difficulties that these Coast Guard crews are having is just the lack of communication. They get information based on 911 calls but a lot of the people they've been rescuing they just see. They get a visual on and they hover over the area. They give them a thumbs-up or thumbs-down to get an indication of whether they need to be rescued.

UNIDENTIFIED PILOT: Going down. Swimmer's going down.

COOPER (voice-over): The pilots hover about 150 feet above the water as Evan Galant (ph) is lowered to the roof of the house below.

UNIDENTIFIED PILOT: He was pointing down saying there is someone in the house. He went downstairs to take a look at the guy's wife. Didn't sound like they were in trouble but he is trying to figure out how to get them on the roof.

COOPER (on camera): Two people are in the house along with two dogs. Medically, they are OK but want to escape the rising flood waters. A basket is lowered to bring them up one at a time.

UNIDENTIFIED PILOT: Survivors getting into the basket.

COOPER: The basket is clear of the roof. They're bringing it up slowly. Eric, the flight mechanic, in the doorway, he has a visual on this and giving the information to Dan Miller and Matt Mayer, the pilot. They are hovering directly above this and can't see what's going on. The basket is back on the roof. Now a second person is getting in the basket. Eric Veragescos (ph) is telling the pilot that a second survivor, in his words, is the basket. And Eric is also giving a word to the pilot to move a little bit to the right in order to hold position directly above where the basket is. They still haven't brought back the rescue swimmer. They're asking the second person to get out of the basket and sit here in order to move the basket and make sure there's enough room. They'll put the basket up on the side. Now it's a question of getting Eric back up on board the chopper and then taking these two as well as their pets.

I got to say, these dogs are incredibly mellow, given what they've just been through. So what's the plan now?

[02:35:44] EVAN GALLANT, RESCUE SWIMMER, U.S. COAST GUARD: I'm not sure. I'm about to talk to the pilots. When I was down on the roof I was talking to them and they said in the next hour or so some boats are going to come through the channel and there is a drop off point not far from here. So they can get on a boat and salvage solve of their property.

COOPER: It's amazing to watch.

GALLANT: I'm sorry?

COOPER: It's amazing to watch.

GALLANT: It's a lot of fun. It's surreal.

COOPER (voice-over): Plans change quickly. Another Coast Guard helicopter picked up four people and dropped them off in a nearby field. The chopper we're in will pick them up and bring them to a shelter.

(on camera): I think we're landing there to pick up some of the people they rescued. And we'll take them because we have more fuel.

The four people who just boarded were wet and cold and trying to ride out the storm but the water just kept on rising. And they think it may rise even more in the coming hours. So they wanted to get out. So they now are going to go to a shelter where they can get some dry clothes, they can get some food, and they can rest. They've been through a lot and ready to get out of here.

(voice-over): There are now six evacuees and five dogs on board. There is room for more than a dozen people. And if space is an issue, we would get off.

In minutes, the chopper reaches the shelter. When the evacuees are gone the chopper heads out once again, searching for anyone in need of help.

(END VIDEOTAPE)

HOWELL: My colleague, Anderson Cooper, reporting there.

Up next, we go live to Los Angeles. My colleague, John Vause, with more on what is happening in Texas and other major headlines we're following, including how the U.S. answered a North Korean missile launch with its own show of force. Stay with us

(COMMERCIAL BREAK)

[02:41:40] VAUSE: Welcome back, everybody. We are live in Los Angeles, coming up on 11:42.

Harvey has brought out the best in many. But as often the case in disasters like this, it has brought out the worst. Hundreds of complaints of rapid price gouging are under investigation by State officials. And others are called out on social media, like this. And some were asking $100 for a case of water.

The White House had a warning for anyone caught charging hugely inflated prices.

(BEGIN VIDEO CLIP)

TOM BOSSERT, DEPUTY HOMELAND SECURITY ADVISOR: Gouging will not be tolerated. Jeff Sessions and the president of the United States will not tolerate gouging. Anybody that's going to go out and try to take advantage of a disaster victim ought to expect law enforcement to come down on them like a hammer. That's not acceptable on a regular day and it's certainly not acceptable when people are suffering.

(END VIDEO CLIP)

VAUSE: For more on this now, business expert, Ryan Patel, joins me in Los Angeles.

Ryan, good to see you.

RYAN PATEL, BUSINESS EXPERT: Thank you.

VAUSE: Sometimes price gouging is pretty obvious. $20 for a gallon of gas, but $4.50 when fuel is in short supply and there are long lines. The national average is $2.25 a gallon. And $4.50 sounds like the market setting the price.

PATEL: Especially when you see the infrastructure in Houston, north of 20 percent of the U.S. economy of gas, it is normal on that end. But to go up to $20 is way too much.

VAUSE: Where do you draw the line, though?

PATEL: When you have a lot of push back where you see the social media, people needing it. Even what happened in Dallas, right? That kind of self-inflicted where people ran to the gas station because of Harvey and caused the shortage.

VAUSE: A self-fulfilling prophesy.

Under Texas law, once the state declares a disaster, it's illegal for anyone to sell or lease fuel, food, medicine, or any other necessity at an exorbitant or excessive price. Is that just within the disaster zone or is it statewide? I think the fuel, it applies statewide. How does all this work?

PATEL: I would take it as statewide. Everyone being affected also outside the zone. Because of the supply chain and because of, again, hitting the fourth-largest city in population, Houston, it has a huge effect in all of Texas, especially for the infrastructure. When it comes to food supply and gas, I don't think it just applies to one, but to everything.

VAUSE: You imagine if someone is, say, someone is hundreds of miles away, the infrastructure is still intact, if they are charging $42 for a case of water, no one's going to pay it.

PATEL: Exactly. Correct.

VAUSE: There are those who argue this is just business. You may have heard of the well-known Libertarian, John Stossel. He tweeted out, "Texas, a state I thought understood capitalism, punishes people who practice it."

What is wrong with that argument, apart from everything?

(LAUGHTER)

PATEL: For me, to answer that, you look at what other companies are doing, Google, Caterpillar, Walmart, Airbnb, urging people to have free housing. Why are they doing this? Is it because --

(CROSSTALK)

VAUSE: They get good publicity, you could argue.

PATEL: You could argue. They're not -- they are losing money in a sense. But a lot of stories I'm seeing on social media, and hopefully we see more of it, are the local mom-and-pop shops. There are not enough said for people who are helping the locals down there.

(CROSSTALK)

[02:45:10] PATEL: But not just that. The local grocery store and HEB -- that's big in Texas -- they are doing what they are supposed to be doing. And they're not trying to make the profit margin. They are there to help. And it's about being a part of the community. That's the ethos. And if you want to be in this business on a long-term standing, that matters more than any short-term gain you can get.

VAUSE: The short-term gain, long-term pain. It's all business in a way.

Ryan, good to see you. Thanks so much.

PATEL: Thanks.

VAUSE: Another diplomatic blow to U.S./Russia relations. Washington ordered Moscow's consulate general in San Francisco to close, as well as two annexes in Washington and New York. It's part of an ongoing tit-for-tat after Moscow imposed staff cuts at U.S. missions. That was triggered by expanded U.S. sanctions. The deadline has now arrived for American personnel to leave. Meanwhile, in the U.S. the three Russian facilities have until saturday to close. The White House says President Trump personally made the decision.

As expected, North Korea has condemned a joint show of force by the U.S. and South Korea which saw the allies' war planes carrying out simulated precision strikes against the North. On state media, Pyongyang said it was a rash act.

More details now from Will Ripley, reporting from the North Korean capitol.

(BEGIN VIDEOTAPE)

WILL RIPLEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: As the hourly music plays in Pyongyang, the initial response from North Korea to that bombing flyover by the U.S. and South Korea is relatively calm. North Korea, in its initial statement, calling it a rash act and saying that the United States is uneasy about their launch of the intermediate range missile over key U.S. ally, Japan. The United States acknowledging that the flyover was in direct response to the provocation.

But what North Korea has not said, at least not yet, is that they are intending to up the ante further with immediate missile launches. We know launches can happen at any moment. There was a statement put out by North Korea vowing to strike the Pacific. They said, quote, "They will be targeting the Pacific where the U.S. imperialist aggressor forces bases are stationed." Going on to say, quote, "It should not be forgotten even for a moment that the whole of South Korea can turn into ruins."

Moving forward, North Korea promising those launches. It's unclear how the United States will respond. We know President Donald Trump and Japanese Prime Minister Shinzo Abe had their second phone call of the week. The prime minister of Japan saying that the United States and Japan completely agree on the strategy moving forward on how to deal with the North Korea problem.

But given the fact that the president's top advisers, his secretary of state, his secretary of defense, feel that diplomacy is the best path, and President Trump tweeted that "Talking is not the answer," that leaves sanctions. And perhaps the U.S. will work alongside the U.K., as Japan will do, to speed up the enforcement of the U.N. sanctions aimed at crippling the regime economically.

The only problem with that is that China would need to be involved. And while they have pledged to hold up their end of the U.N. Security Council sanctions, at least at this point, they seem unwilling to take the economic steps of completely cutting off the regime that the United States feels would cripple Pyongyang and force them to come to the bargaining table from a position of desperation, being willing to give up their weapons. Something that North Koreans say they will never do.

And North Korean officials in Pyongyang said they feel the time for talk is over. And they said, if China were to cut them off economically, they'd survive and they'd keep launching missiles, just like they did during the great famine in the 1990s when hundreds of thousands of people died of starvation, and yet, the regime stayed firmly in control. And by the way, this country is much more self- sufficient than it was back then.

Will Ripley, CNN, Pyongyang, North Korea.

(END VIDEOTAPE) VAUSE: When we come back, man on a mission. NFL Defensive End J.J. Watt is a fundraising machine right now. How number 99 is using his star power to raise serious money for those hit hard by Harvey.

(COMMERCIAL BREAK)

[02:53:02] HOWELL: Welcome back. I'm George Howell.

The U.S. President Donald Trump has pledged $1 million of his own money to Harvey relief efforts. He visited the area Tuesday, meeting with local officials and first responders. No word on yet on exactly to what and where his money will go. The White House did briefly put its feud with the media aside to ask reporters for suggestions.

Houston Texas NFL Defensive End J.J. Watt started out aiming to raise $200,000 for his town and through crowd funding. Fast forward a week, the football players has crossed the $13 million mark and counting. More than 130,000 people who donated through this page. There are a few big chunks from celebrities, but mostly it's regular people helping out.

My colleague, Anderson Cooper, spoke with Watt earlier about his project.

(BEGIN VIDEOTAPE)

COOPER: When you saw it go up and reached 200,000, every time you clicked on the site, you see the numbers.

J.J. WATT, FOUNDER, NFL DEFENSIVE END & J.J. WATT FOUNDATION: The numbers kept scrolling and then broke the site. Kept scrolling.

COOPER: You broke the site?

WATT: We broke the site. The funniest story is actually the initial night we broke the site, we couldn't figure out how to get it back up. And we found the CEO phone number and called him at his house, at his house, and got him out of bed and he helped us to fix the site. And then it got rolling. So here we are.

COOPER: Wow. That's customer service.

WATT: I got to give the guy credit. He was unbelievable. He helped us raise a ton more money because he kept the site up and rolling.

COOPER: Do you now have a goal in mind or is it just open ended?

WATT: It's kind of open ended. Once we hit $10 million, I'll put it at 15 and see what happens. Yesterday, we raised $4 million. Today, it's over $3 million. We'll let it go and see where it goes. Maybe it gets to 20 or more. But now I'm focusing my efforts on making sure we get the money back to the people.

COOPER: Do you know how you'll do that?

WATT: My first phase, this weekend, my teammates and I, we have semi- trucks rolling from out of town we filled up. About nine semi-trucks coming into town and we have those filled with stocked supplies of water, food, clothing, everything. We'll give it out this weekend. That's the first step. Then regroup after the weekend. Like I said, I was planning for $200,000. And now with the new plan for multimillions, I'm making sure I get with the people that learned from Katarina, so I can make sure I do it right. With these people trusting me with the money, I want to make sure I don't do it hastily. I want to make sure I do it exactly the right way.

(END VIDEOTAPE)

[02:55:29] HOWELL: J.J. Watt doing some great things.

If you'd like to help, you can visit CNN.com/impact. You'll find links to charities vetted to help people in the region.

That's the latest live here from Houston, Texas. I'm George Howell. CNN's special coverage continues on the aftermath of Hurricane Harvey with "EARLY START" after the break.