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QUEST MEANS BUSINESS
EU Leaders Gather in Brussels to Discuss Top Jobs; Johnson & Johnson Opioid Trial Begins in Oklahoma; MacKenzie Bezos Signs a Pledge to Give Away Half of Her Fortune. Aired 3-4p ET
Aired May 28, 2019 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, CNN INTERNATIONAL HOST, QUEST MEANS BUSINESS: We are an hour away from the closing bell on Wall Street on what a day. The early
gain -- good gains in the morning evaporated. Now we're seeing losses and we are at the low point of the day with 60 minutes left to trade. The Dow
is down. The S&P is down. The NASDAQ though, the tech stocks are holding up just marginally better. Well, those are the markets and these are the
E.U. leaders meeting in Brussels. Their jockeying for influence, intensifying. The first opioid trial in America begins. The outcome could
set a precedent of massive payouts. And Canadian lawmakers fuming after Mark Zuckerberg fails to show up.
We are live in the world's financial capital, New York City. It is Tuesday. It's May the 28th. I'm Richard Quest, I mean business.
Good evening. Tonight, a summit, a competition for influence and a sharp warning. European leaders have gathered for their first meeting since the
European parliamentary elections. That election upset the established order and set off a race to fill key positions within the union.
Voters delivered a message that centrist parties are out of favor. And the German Chancellor Angela Merkel has been Europe's stalwart of centrism.
In a rare interview exclusively with Christiane Amanpour, the Chancellor said she's got the message.
(BEGIN VIDEO CLIP)
ANGELA MERKEL, GERMAN CHANCELLOR (through translator): First of all, I was pleased that more people went to the elections than in the last European
elections. That's been the case in many countries. Secondly, we have become the strongest party and this will of course play a role when we
nominate the positions within the European Union.
And third, it is correct that the greens actually have been very strong. And it has to do with issues that people are interested in the most these
days, for example, climate change. And that is also for my part of course, a challenge now.
We have to give better answers to all these issues and we have to set very clearly that targets that we have committed to are targets that we remain
(END VIDEO CLIP)
QUEST: Erin McLaughlin is in Brussels. Erin, last night and we've been talking and listening to what the leaders will decide as a result of the
elections and how the political balance has shifted. Does the horse trading begin?
ERIN MCLAUGHLIN, CNN CORRESPONDENT: Absolutely, it does, Richard, the stakes at this point are so high. Up for grabs, the E.U.'s top jobs -- the
President of the European Council? Who replaces Donald Tusk, the President of the ECB? The next High Representative for the E.U.? Who replaces Jean-
Claude Juncker, the President of the European Commission? That has been seen as the top prize in all of this. Negotiations are now underway at the
Summit here in Brussels and process is really important at this point, Richard.
They're discussing whether or not to use the so-called lead candidate system, which would give an edge to German Chancellor Angela Merkel's pick,
which is Manfred Weber, the leader of the EPP list.
If they use the lead candidate system, Weber gets the edge, but French President Emmanuel Macron wants to go in a completely different direction.
So we're going to have to see how all of this plays out.
Whoever the Council picks, it's going to have to be via a qualified majority and then get the approval of European Parliament, which is highly
fragmented, so this process really could take a while, Richard.
QUEST: Erin McLaughlin in Brussels. Erin, thank you. Now European markets closed lower on Tuesday. A big talking point for investors was
Italy's feud with the European Commission.
Italy's Deputy Prime Minister said the Commission could fine the country more than $3 billion for allegedly breaking the E.U. budget rules. The
Milan Index closed down half of one percent. Everybody was down in Europe, but Milan, the MIBTEL was off more than most.
The world's largest democracies have now spoken and the trend is clear. After years of austerity and economic inequality, the political middle
ground is tumbling and voters are moving towards the extremes.
You think I'm wrong? Look at this. Europe, populist Eurosceptics and anti-immigrant parties gained at the expense of the center.
[15:05:11] QUEST: The Brexit Party in the U.K., Marine Le Pen's Party in France, and Matteo Salvini in Italy, all came out on top. In India,
Narendra Modi easily secured a second term. He campaigned on a message of Hindu nationalism and his party embraced anti-Muslim rhetoric.
As if we need to point out the point too much, Donald Trump embodies this movement in the United States and he has forced the Republican Party
sharply to the right with the 2020 presidential race now in full swing, the Democrats further left to take on the President later in the year.
Richard Haass is with me, the President of the Council on Foreign Relations. Always good to see you, sir. Thank you for taking the time.
When you look at this polarization, first of all, how -- let's just start with Donald Trump and his comments whilst overseas.
I was reading your tweets, Donald Trump tweets from Japan associating himself with Kim Jong-un against Joe Biden. Then he tweets supporting at
Israeli PM and his efforts to form a government. Short sighted at home and abroad. Why?
RICHARD HAASS, PRESIDENT, COUNCIL ON FOREIGN RELATIONS: (Audio issue).
QUEST: Right. We do have -- Richard, I need to pause you there. We are having problems here. Well, we can hear you, but it's distorted. So we do
need to sort out exactly why that was happening.
We will take a look at the markets to see what exactly what's happening with those markets. The Dow Jones Industrials, we need to monitor it very
closely as we go into the last hour with uncertainty, with Donald Trump's comments over the last 48 hours.
This being the first day after Memorial Day, Labor Day is the other one at the other end. We do need to keep a watch on it.
Let's take a break. Let's take a moment to break and when we come back, hopefully, Richard Haass, we will be able to hear.
This is QUEST MEANS BUSINESS.
[15:10:15] QUEST: All right, let us rejoin Richard Haass, the President of of the Council on Foreign Relations and the author of, "A World in
Disarray." My apologies, Richard, but hopefully, we can now hear you in in crystal quality, which, of course, is the important thing.
Now, you were just about to tell me. The politics, the traditional policy of no longer having politics, the politics stops at the water's edge in
either direction. You say that President Trump's decision to criticize Biden et al is short sighted?
HAASS: Well, absolutely. I don't think it ever looks good for an American leader or politician to criticize other Americans abroad. There's a time
and place for everything. That's not it.
And then also to intervene in the Israeli coalition politics again, was to me improper and unprecedented. I actually think that the President ought
to be doing a lot less tweeting while he's doing these trips, because it looks like he's distracted, which is an insult to the host government.
And it certainly doesn't help when he's tweeting texts that are contrary to the wishes and views of the host government, as he did over ballistic
missiles in the in the hands of North Korea.
So I literally would leave his telephone at home. I think it'd be a good move all around.
QUEST: Richard, you've been asked this sort of question before, but I -- why? Why does it matter? Surely, the very point here is that this
President got elected by sticking two fingers up at the establishment for which I might put you into that category and myself probably as well.
You know, he says, "Look, I freely admit, don't like it. You know what? You can shove it?"
HAASS: No, you're exactly right. And in some ways, it was a harbinger of what we've now seen in Europe. He is an anti-establishment politician.
He's a disruptor. He's written the issue of opposition to immigration. He's talked a lot about people who feel disadvantaged by trade.
One of the big differences, interestingly enough, is rather than seeing in the United States, like we're seeing in Europe, Richard, the proliferation
of parties on the right and the left, what Mr. Trump did was engineer essentially a takeover of the Republican Party.
QUEST: Very clever. If you can't beat them, take over somebody in turn them. The European issues. In Christiane Amanpour's interview with Angela
Merkel, she makes -- the German Chancellor make some very sobering references to the rise of anti-Semitism in Germany at the moment.
This nationalistic fervor that led to Brexit, led to Marine Le Pen has a very long and dangerous tale to it. Would you agree?
HAASS: Oh, absolutely and issues that we thought were safely resigned to history are coming back. It shows we're not immune and we are seeing
pretty radical things on the right and the left.
And I just wanted to build on the report you had on just before me, the danger is not simply what happens in the European Parliament or the
European Commission. No one should think the kind of political effects we saw in the last 72 hours are confined to the European votes.
We're not going to see them played out again and again in national elections and that's still where the real power is. So I'm actually more
not less worried by what we've seen over the last few days.
QUEST: So how do you turn this round if indeed you do? I mean, maybe, you know, this is a wheel it has to just -- again, it has to play itself out.
What would your suggestion be?
HAASS: I hope it's not something that simply has to play itself out. Look, I think the challenge for the centrist parties is to stand for
In Britain, for example, both the Tories and Labour have blown it with their dithering over the misguided initiative of Brexit. They didn't give
people a real a real chance -- a real choice based upon a serious policy.
Macron in France, the Christian Democrats and others in Italy. They have simply -- they've failed to govern, and they've failed to put forward
serious proposals to deal with people's problems. So it's not surprising. They are being replaced by people on the left and right, even if the
replacements are putting forth essentially foe solutions to very real concerns.
QUEST: Are we more dangerous tonight?
HAASS: Oh, absolutely. If you're not worried here, you're not you're not paying attention. This is the 100th Anniversary, interestingly enough of
Yeats's poem, "The Second Coming" and the idea the center cannot hold things coming apart. We are seeing some serious things coming apart, not
just in Europe. We saw it in Australia, India, we're seeing it in my country.
[15:15:04] HAASS: This is a warning shot, that if traditional politics, don't deliver, people will turn as they turned in previous moments of
history to non-traditional politics. If that happens again, it won't have a happy ending.
QUEST: Richard, we are grateful you came to us as always, to talk about it on this program. Thank you, sir. Thank you, as always, and apologies
again for the sound.
Now the markets and the losses are accelerating. We look at the market. Not hugely. I mean, you might arguably say, well, we already down half a
percent, but it's the way in which the day has gone.
It is the fear of the trade war, that's hurting the stocks. Donald Trump says China is not ready to make a deal and that's taken its toll.
And as the trade war intensifies, Alibaba is reportedly looking to list its shares on a second exchange in Hong Kong, which of course, it rejected for
its main listing back in 2014.
Reports suggests that Chinese e-commerce will raise $20 billion with the move. Clare is with me. Clare Sebastian, why do they want to do Hong
Kong? They've got a good solid listing in New York, and they rejected Hong Kong.
CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: They did.
QUEST: Why now?
SEBASTIAN: Well, so one of the reasons why they rejected Hong Kong back in 2014 was because the rules in that jurisdiction stated at the time they
couldn't do a dual share listing, so they couldn't have the top executives and the founder have greater voting rights than the rest.
Now those rules have been somewhat relaxed, so they can go in and do that. But it's not just that as you suggest, Alibaba wants to raise money.
They've got to diversify their business away from core commerce. There are things like the Cloud and entertainment.
And the potential for politics at play here as well, Richard. If you look at Alibaba's share price since they listed, it was on a nice upward
trajectory until the fears of a trade war last year, and then they plummeted. They're still down about 25 percent.
QUEST: But that wouldn't change if it was a --
SEBASTIAN: Well it might help because it is a different time zone. So if think about it, trading in Hong Kong versus trading in the U.S., there's
going to be much more opportunity to trade so it might help smooth out some of the kinks.
Plus the fact that investors in Hong Kong might be a little bit more friendly towards Alibaba. It might be a bit less than to trade partly
because perhaps these investors are using Alibaba's product in a way that the investors in the U.S. just don't.
QUEST: So what's your feeling? Will it happen?
SEBASTIAN: Well, I think, you know, certainly --
QUEST: Because Alibaba is B2B -- is B2C there, but B2B in the rest of the world, which I didn't realize until not that long ago. And it is companies
using Alibaba to get into China to sell their products to consumers.
SEBASTIAN: I think there's a good chance that this will happen. I think, Alibaba certainly needs to compete. There's a lot of the other thing we
haven't mentioned, there is a lot of upstart tech companies in China that are starting to gradually eat their lunch and they need to have these funds
Plus, perhaps loyalty to the Chinese government, Richard. Jack Ma, don't forget is a member of the Communist Party.
QUEST: Good to see you, as always, thank you. The two most recognizable faces at Facebook -- Mark Zuckerberg and Sheryl Sandberg have ignored a
subpoena from Canada to appear at an international meeting on data privacy and elections.
Facebook instead sent two representatives from its public policy team. Zuckerberg and Sandberg now risk being held in contempt of the Canadian
Parliament. Canadian MP, Charlie Angus says the two will be hauled in front of his committee anytime they enter the country.
(BEGIN VIDEO CLIP)
CHARLIE ANGUS, CANADIAN MEMBER OF PARLIAMENT: Mr. Zuckerberg and Miss Sandberg decides to come here for a tech conference or to go fishing, the
Parliament will be able to serve that summons and have them brought here.
Paula Newton is with me in the Canadian capital of Ottawa. They must have known the risk when they decided to reject or at least to ignore this. Why
did they do it knowing that risk?
PAULA NEWTON, CNN INTERNATIONAL CORRESPONDENT: You know, I think that Facebook believes that they've got this and the legislators want to say
right back to them, "No, you don't. You show us again and again, whether it's breaches of privacy or meddling in elections that you do not have
Richard, we had the controversy just with Nancy Pelosi in that video where they were at odds with lawmakers saying, you know, that distorted slow down
video of Nancy Pelosi, it was brought up at the hearing again today, Facebook did not take it down. And that's one of the things they were
questioned about again, today.
Richard at issue here is what this social platform will look like when it's gone through the wringer of all of these legislators right around the
Now, the summons might be from Canada, Richard. But again, this is an International Committee. They had asked to speak to them in London in
November, it didn't happen. They were no shows. They have asked to speak to them again. They say they represent more than 400 million people and
more than that, they say they're in contact with the U.S. Congress about trying to come to some kind of coordination about what new laws will look
And Richard, it will bite. They're talking about fines that are not one time events, but could be daily or weekly, and talking about laws that hold
them to account not just for election meddling, which you know, they don't have anything to do with. They're trying as hard as they can to try and
spot that as quickly as they can.
But more to the point about data collection and you and I both know that the business plans of a lot of these companies, including Facebook, rely on
that data collection.
[15:20:09] QUEST: But, look, Paula, Zuckerberg and Sandberg are well aware of all these factors. They have large numbers of people in the public
policy, including, of course, now Nick Clegg, the former Deputy Prime Minister of Britain.
So they're taking a calculated what? Risk? Gamble? Opportunity? When they make this decision?
NEWTON: And again, you might be right, they might say it's a calculated risk, we will put their minds at ease. They are working with the
government's individually, even the government in Canada here to try and come up really, with some kind of a law.
We have an election here in Canada in the fall that they would be able to anticipate any problems going forward. What remains to be seen is whether
or not Facebook and the other tech companies -- remember, Google, Twitter, Apple, Microsoft were all asked to appear -- whether or not they turn to
the courts, when they actually see legislation around the world that has real bite to it.
And whether they decide, look, this is just -- they are hamstringing us too much. And perhaps they think that that is the way they will try to both
negotiate some of those laws that do not touch their business model at the end of the day. And if they don't, if that doesn't work to negotiate with
these lawmakers, they'll just take their beef to the court, they obviously as you said, knew what they were doing, by not showing up today.
QUEST: Paula, thank you. The markets and the Dow is down today as investors first chance to react to the President saying the U.S. is not yet
ready for a trade deal. We are off 112 on the Dow.
(BEGIN VIDEO CLIP)
DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: They would like to make a deal. I think they probably wish they made the deal that they had on the
table before they tried to renegotiate it, they would like to make a deal. We're not ready to make a deal. And we're taking in tens of billions of
dollars of tariff and that number could go up very, very substantially very easily.
But I think sometime in the future, China and the United States will absolutely have a great trade deal.
(END VIDEO CLIP)
QUEST: Two economists have put out a warning of what to come if tariffs expand to cover all U.S.-China trade war. The headline number is $600
billion. That's the amount by which global GDP will shrink in 2021, the year of peak impact and financial markets could fall by 10 percent as well,
that would compound the shock.
We have a guest, our new C-suite. The former U.S. Trade Representative and now Vice Chairman and President at MasterCard, Ambassador Michael Froman.
Welcome to our new C-suite. Good to have you here.
MICHAEL FROMAN, VICE CHAIRMAN AND PRESIDENT, MASTERCARD: Good to see.
QUEST: Look, let's just refresh our memories where we are. We've got the increased tariffs on China. There's the process going forward with the
longer ones. He said autos are just on the back burner for the moment. Do you see the situation as stable?
FROMAN: Well, I think it's very dynamic right now and it's quite unstable. Certainly, imposing the tariffs and threatening to impose tariffs has
helped bring China to the table. But now the question is whether those tariffs will actually produce the kind of solution that will produce a
long-term gain for the United States and that's very unclear at this point.
QUEST: But if China had done to you what they did to the administration, in terms of going back on promises that they'd already made within the
negotiation, you'd have wanted to do something actual like this.
FROMAN: Rule one of trade negotiations is that nothing is agreed to until everything's agreed to. So it's not surprising to me that there was some
movement before they've reached an actual final agreement.
QUEST: Let's just put China to one side, the Trump administration isn't just threatening tariffs on China. There's also of course, the auto
tariffs in the United States, with Germany and the rest of the world.
Now, let's have a listen to what Chancellor Angela Merkel had to say to Christiane Amanpour on this.
(BEGIN VIDEO CLIP)
MERKEL (through translator): My argument, of course, is that German cars are not built only in Germany, that for example, with the BMW, their
biggest plant is in South Carolina. This means Germany has much more direct investments taken out by German companies in America than the
reverse -- American companies investing here.
(END VIDEO CLIP)
QUEST: All right, so she doesn't want tariffs on German vehicles, but do you think that the administration will go down that nuclear route?
FROMAN: I think there's a lot of opposition to doing so including within the administration. It's true that the Europeans have a 10 percent tariff
on our auto exports, our tariff is only two and a half percent on theirs. But it's a hard argument to make that their imports pose a real national
security threat to the United States since we have a very robust auto industry.
We have a lot of factories, they're operating at quite high capacity. Unlike steel and aluminum. There's no argument here that these are at
QUEST: What are you hearing from your contacts about steel and aluminum tariffs and how they've affected? Now, clearly U.S. domestic producers are
seeing great profits in that sense that they've managed to be able to jack up the prices, but are we seeing job losses yet?
[15:25:12] FROMAN: Well, the steel companies themselves are doing better. There's been a modest increase in employment, I think something like 2,500
new jobs. But there's some estimates that other related jobs to the tariffs downstream jobs, the industries that use steel and aluminum that
are finding higher prices or the industries that are affected by the retaliation are now losing 23,000 jobs.
So I think it's very unclear what the net-net is here. The Peterson Institute in Washington has done an estimate that, yes, there's been new
jobs created in the steel industry, but they've cost the American economy about $900,000.00 per job. And obviously, the steel worker is not getting
QUEST: And this idea which I still find fascinating, because the President referred to it in Japan, about tariffs and he loves the beautiful money
coming in. And he says -- and I think the words of the day were, and there will be even more of it coming in?
FROMAN: Well, it's not coming in of course.
QUEST: I see you wince.
FROMAN: I think as people, I think have tried to explain, the tariffs are paid for not by the exporters, not by the Chinese, but by the importers, by
the consumers, by the people who are buying the imports in order to put into their manufacturing products.
QUEST: You were the USTR. Don't you secretly have an admiration for Ambassador Lighthizer the way he has -- he has gone nuclear in a way that
many of you would have wished you could have done.
Now, you can arguably say he is pulling the house down around his end, but in an era of diplomacy, where nice-y, nice-y, nice-y. He has just
basically said, "No."
FROMAN: Well, first of all, I think Ambassador Lighthizer is a real professional. He's a real trade expert. He's been involved in this sector
for decades. And so he knows what it is he is doing.
And I think through his actions and the actions of the President, they have increased U.S. leverage. But now the question becomes, what do you do with
that leverage? And what constitutes success? And how long will it take?
Thus far, the President is trying to convince the American public that it's okay to suffer a certain amount of pain, whether you're a farmer, or a
consumers who is going to be paying a 25 percent tax on the products that you buy in order to achieve a long-term gain. How long term will that be?
And how will we know when we get there? And that's the hard part.
Because if we're asking China to fundamentally change their approach to industrial policy, which they believe has been in their interest for so
many years, that's a very difficult negotiation.
QUEST: We'll talk more about it with you, sir.
FROMAN: Thanks for having me.
QUEST: Thank you very much. In Oklahoma, a historic trial has begun. It is putting the Big Pharma under the spotlight. We will be outside the
courthouse. It is over the opioid crisis and who bears the blame for so many OD.
[15:30:00] RICHARD QUEST, HOST, QUEST MEANS BUSINESS: Hello, I'm Richard Quest, there is more QUEST MEANS BUSINESS in just a moment. In a historic
trial beginning over opioids and the results of that could set massive precedence over the level of payouts in the United States. MacKenzie Bezos
has signed onto the giving pledge.
She's agreed to give away half of her wealth. When and how and how much, well, that remains to be seen. This is CNN and here on this network, the
facts always come first. Europe's leaders are gathered in Brussels for a summit following the parliamentary elections.
They're beginning a process of filling top jobs like European Commission president. Whoever steps into that role will be the bloc's chief executive
for the next five years. Let's getting now to the wild for Israel to form a new government. The Prime Minister Benjamin Netanyahu is threatening to
call for new elections if a compromise can't be reached by Wednesday's deadline. Coalition talks remain deadlocked.
Japan is in shock after a deadly stabbing that targeted a group of young girls while they were waiting for a school bus. One girl and her father
and another student were killed. Police say the suspect stabbed himself to death. Violent crimes such as this is extremely rare in Japan.
In the Midwest of the United States, people are bracing for another round of violent weather after a night of severe storms. As many as three
tornados tore through the state of Ohio Monday night. The devastation is somewhat incredible. One person was killed when his car was pushed into
A fight between rival gangs is being blamed for several deadly prison riots in Brazil. As we're seeing outside, one institution as family members of
the inmates and guards tried to get information about the fate of loved ones. Fifty five prisoners died in the riots at four different prisons.
The first major test of whether drug makers can be held accountable for the U.S. opioid crisis is under way. It's a trial against Johnson and Johnson
in Oklahoma where the state's attorney general is accusing the company of ruining thousands of lives and costing Oklahoma billions of dollars.
Jean Casarez is there hearing J and J's response and she joins me from outside the courthouse in Norman. This morning when we spoke on "THE
EXPRESS", you heard the opening side -- you heard the prosecution if you like or the plaintiff's side. Now you've heard I assume some of J and J's
defense. I always find where the case that one's view changes quite dramatically as the Swiss soar and swing goes between the two sides. Now,
you've heard both, what's the thoughts?
JEAN CASAREZ, CNN CORRESPONDENT: You are so right. We are still in the middle of the defendant's opening statements, and that is Johnson and
Johnson and their subsidiary. And what they're focusing on right now are the two actual drugs that they helped to manufacture and distribute right
here in the state of Oklahoma.
And they're focusing on the label and the instructions, and they're saying that their drugs, which are a class two drug, had it on the label and the
warnings that potential addiction, abuse, if you have misused and life- threatening conditions can result, it can lead to overdose and death.
So any claim they say that they abused the drug, the opioids is false. They also are talking about their fentanyl patch because that's one of the
two they distributed here. They're saying that the FDA approved that patch, that it was approved by the Oklahoma Drug Utilities Review Board,
and it is still covered by state insurance in Oklahoma.
[15:35:00] And they displayed a chart about worldwide, that 600 billion patches to date have been distributed worldwide, and out of that, there
have been 103 reports of an overdose. They then go on to their other medication, which is Nucynta, they say that it's a dual-action opioid which
means part of it is opioid, but the other part is something that is very less.
It is an opioid, but it can give the satisfaction of euphoria. And it goes on to say, that there's a plastic coating on that pill that is so hard and
that is to preclude abuse, that if you try to chop it up, put it in a blender, do anything, it breaks the blender because the coating is so hard
on it. And that is an action they took to prevent the abuse of their opioid prescription medication.
QUEST: But the real problem here is, isn't it, that there is a crisis, it's a recognizable crisis, and the danger of course is that the public and
the jury believe somebody has to pay.
CASAREZ: That's right, and this is before the judge. This is a bench trial because after Purdue Pharma and Teva Pharmaceuticals out of Israel
settled, there was only one count left, they dismissed everything else, and it was a public nuisance claim which is from common law and it can only be
before a judge.
So there's no jury. But here's what you're saying, you are saying what the plaintiff said representing the state of Oklahoma. There was no opioid
crisis in this state before 1996, and that's because they realized the dangers and it didn't happen. But from 1996 on, that's when it began to
build, and you suddenly have a crisis and those were the exact years --
QUEST: Right --
CASAREZ: The plaintiffs say that Johnson and Johnson came into this state and started, they say, misleading medical professionals and the public that
there was no harm to this medication, and that's when the crisis began and to grow out of hand.
QUEST: You'll be watching the case as it winds its way, Jean, and you'll be back to tell us more as we follow it through. Thank you. MacKenzie
Bezos is donating nearly half of her $37 billion fortune to charity after signing the giving pledge. It comes months after finalizing her divorce
from the Amazon founder Jeff Bezos. And among the signatories announced today was the co-founder of WhatsApp Brian Acton and the co-founder of
Pinterest Paul Sciarra. Anna Stewart joins me from London.
There's a lot of money -- remind us what this giving pledge is about.
ANNA STEWART, CNN REPORTER: Giving pledge was started nine years ago, Richard, 2010 by Warren Buffett, Bill and Melinda Gates. And essentially,
it pledges for billionaires to give away at least half, a majority of their wealth either in their life or in their death, in their will to any
charities or philanthropic ventures they choose.
There's no given where it has to be or when? But it is over half their fortune.
QUEST: And MacKenzie Bezos by any definition, large, smaller or otherwise has a fortune. But what she says is, she's going to do, but we don't know
where, how or when?
STEWART: We -- exactly, we don't. But it was interesting in her statement, she really resonated with a lot of people in her letter. She
said very freshly-minted billionaire by herself since her divorce, and as you said $37 billion. She says she has a disproportionate amount of money
to share, and I think everyone would agree with that.
So, she is pledging over half of it, but we don't know when, we don't know where? But we do know that her and her ex-husband Jeff Bezos did give some
money to homeless charities, so perhaps that's where she'll be looking at next, but it's anyone's guess really, Richard.
QUEST: The sums involved all vast. I mean, if you then add to these other people that we talked about, anyone of which is worth a few billion.
They are -- they are beyond the realms of mere mortals like us to conceive.
STEWART: Honestly, Richard, I was looking at it, and looking at the list, there are 204, now, as of 19 extra ones being added today. Two hundred and
four billionaires that is at least $500 billion that will be going to charitable causes around the world in coming decades. That is huge.
And you will know from all your times in Davos, every year at the beginning of the year, you go to Davos, you get the Acheson Report --
QUEST: Yes --
STEWART: On social inequality. Last year, 26 owned the same as the 3.8 billion people who are the poorest in the world. You hear news like this
and you feel kind of good. It's not a legal contract, I will add, but it is a moral commitment.
QUEST: Anna Stewart in London, we appreciate it. Called gridlock in the death zone. The harrowing images and the rising death toll, putting
pressure on Nepal to regulate the climbing industry. But how do you regulate Mount Everest? How do you prevent people climbing? Do you not give
permits? Do you charge more? It's an issue to be discussed after the break.
[15:40:00] (COMMERCIAL BREAK)
QUEST: We're down the best part of 200 points, we have been off 200, but now, and that's the way the markets are looking. They're accelerating into
the final hours. We've got 15 minutes left to trade and it is very different from this morning where we were up 30, 40 points and we bounced
around that sort of low for most of the session.
It is trade worries, but it's more than just that, it is a feeling you just don't want to go into the late evenings when you're along -- there's really
no specific reason why we have just drifted off deep into the -- into the red. Nepal is considering changing requirements to climb Mount Everest.
Eleven climbers have now died on the mountain so far this year.
The pictures that we've seen of crowding on the summit has put a spotlight on the entire industry that supports the climb and whether people are being
up allowed with too little experience and too little equipments. Speaking to CNN, the director, the director general of Nepal's tourism at the moment
rejected those claims.
(BEGIN VIDEO CLIP)
DANDURAJ GHIMIRE, DIRECTOR GENERAL, NEPAL TOURISM DEPARTMENT: The good people who are coming here for climbing, actually they have good
experience. And already they have -- most of the people who are coming here, actually, they have good experience at --
UNIDENTIFIED FEMALE: So what are your -- what are the government's requirements for experience when someone is going to climb Everest?
GHIMIRE: Well, we don't have such system, but automatically they're coming --
UNIDENTIFIED FEMALE: So you don't --
GHIMIRE: Actually --
UNIDENTIFIED FEMALE: Have a system --
GHIMIRE: No, we don't have a --
UNIDENTIFIED FEMALE: Of regulating experience?
GHIMIRE: System -- just -- we don't need the experienced people -- experienced climbers who only come to climb Mount Everest.
(END VIDEO CLIP)
QUEST: So there were 381 permits issued this year. The permit itself cost$11,000. Now, the growing part of a guided expedition, that's around
about a 100,000 for a tourist who tries to make it to the summit. Only a third, 29 percent actually make it to the top. Jake Meyer is in London, a
mountain climber who -- you got to Everest at the age of 21.
When you got there, Jake, were you qualified? Were you qualified -- do you consider in hindsight that you were experienced and qualified to get there?
JAKE MEYER, MOUNTAIN CLIMBER: Thanks, Richard. So, yes, I was just 21 when I did Everest. It was the last of my seven summits, so I felt that at
the time that was a relatively good path to build up those skills and that experience needed to get to that.
[15:45:00] But I've never done an 8,000 meter peak before, I've never used oxygen before, I've never been above 7,000 meters which is what certain
people are saying you must have climbed over 7,000 meters. It's very difficult to just create a set of some arbitrary requirements that don't
really take into account the very different experiences that people can have on different mountains.
QUEST: So -- but the sort of pictures we're looking at now, you can also see the traffic jam. It's pretty -- it will be humorous if it wasn't so
serious and deadly. But how typical is that?
MEYER: I think it is going to be typical on many popular mountains. You take somewhere like Kilimanjaro for instance, another one of the seven
summit, where you're going to have long queues of people. Now, of course, the difference between a queue on Kili and a queue on Everest could be very
different in terms of the outcomes of that.
And of course, the higher you go, the more risk there is, especially high up into the death zone where you are on limited time as it is. We've got
to slightly be careful that we don't conflate the queues, specifically with the deaths. Certainly, from what I've read, and again, this is only from
what I've read online, it looks like three or so of the deaths could possibly be related to the time spent up there. The others, as horrific as
it sounds, it sounds like pretty standard altitude-related deaths.
QUEST: All right, we're a business program. It costs a 100,000 roughly to go up Everest. The permits are $11,000. What's the suggestion here, ban
them? Increase -- I mean, look, if we were -- you know, if you put the -- if you put the fees up, you end up with Everest just being rich.
MEYER: Absolutely. I mean, a lot of people would say that if you take away the opportunity for Nepalese government to charge the permits,
therefore, just reducing or even banning climbing Everest, then you remove a lot of money from the economy.
You could have the number of permits and double the cost of it. It then just becomes the playground of the rich and of those who can afford it. I
think again, we should be slightly careful that they can be up to -- and occasionally up was a $100,000.
But the average -- the average cost of an expedition for Everest now is below $40,000. You could -- you could sign up tomorrow, Richard, if you
really wanted for about $32,000. And whether or not that company checks your climbing resume --
QUEST: So --
MEYER: That of course is part of the problem.
QUEST: But Jake, you know, I've read this story all week, and I still I'm not sure what the solution is other than -- because I don't think there's
an economic solution in that sense. I don't think raising the point of entry will improve the quality of experience.
So do you have a test, do you have an experiential limit that you have to have reached before you climb Everest, and if you do, what is that bit of
paper you brandish?
MEYER: It's a very good point. If you look at some other sort of extreme sports, for instance, something like the around the world yacht race, many
of the people who start on that have had no sailing experience before they go. However, in the build up to taking part in the actual race or a leg of
the race, they have to have achieved a certain amount of training and preparation.
And of course, if they're not found to be fit or if they self-select out, then they don't do the race. Now, how you would set that for Everest, of
course, we -- you know, climbers could argue over that all day long and do you have to be above --
QUEST: Right --
MEYER: Eight thousand meters, is it about the quality?
QUEST: Yes --
MEYER: But there are many opportunities --
QUEST: Good --
MEYER: That certainly could be looked at. And I think it needs a number of things.
QUEST: Jake, the race is on, you know, I've done business traveler for enough years to know that experiential travel is what everybody wants.
Everybody wants the next biggest, best, most dangerous, most extreme, most advantageous thing. This was inevitable on Everest.
MEYER: I think there's an inevitability about it, it's a shocking turnout for this year, but also potentially, looking like it might be one of the
record-breaking years. Now, of course --
QUEST: Right --
MEYER: That shouldn't -- one shouldn't lead to the other. It should be about --
QUEST: Right --
MEYER: How can we enable more people to have these incredible adventures, but do so safely and minimizing the impact on the mountain and the
QUEST: Well, I assure you with my knees, you will not see me on Everest, since it can barely at the moment with me -- my knees can get up a flight
of stairs. Good to see you, sir, thank you. QUEST MEANS BUSINESS --
MEYER: Thank you --
QUEST: Continues, the market is down, we'll update you of that before we leave you at the top of the hour. But GM is teaming up with Bechtel to
super charge America's infrastructure. In a moment.
[15:50:00] (COMMERCIAL BREAK)
QUEST: General Motors wants to make it easier to charge electric vehicles. And to do so, it's teaming up with America's largest construction company
Bechtel, they will build thousands of charging stations across the United States. Unlike the fuel already in place, these won't only be on highways.
Peter Valdes joins me. Where will it be?
PETER VALDES-DAPENA, CNN BUSINESS AUTOMOTIVE CORRESPONDENT: Well, GM is pointing out that a lot of people need to charge cars when they're in the
city. A lot of people -- cities are a great place to use electric cars, except if you have an apartment, you don't have your own garage, where do
you charge it?
So they're going to put electric charging stations in urban areas like New York and Chicago where people who live in cities can charge their cars
QUEST: Is charging -- well, is charging still the Achilles heel of electric vehicles? Every time I think of -- not that I would buy one
because I don't have a car anyway, but I did -- I think, you know -- oh, where will I charge it? What happens if I certainly find myself -- you
know, I need a pint of milk --
VALDES-DAPENA: Yes --
QUEST: And the car is on low charge.
VALDES-DAPENA: Well, if you need a pint of milk, you're probably at home and you probably should at home. Where it becomes a big issue is I guess
for people in cities who don't have their own garages, that's an issue. And certainly, one thing people worry about, even now that we have electric
cars with ranges of over 230 miles, people worry about what if I'm driving from New York to D.C., you know, how do I do that? And this will put to
rest some of those concerns.
QUEST: The problem is, you know, if I'm driving from New York to D.C. and it's in traffic and there's traffic jams, there will be a petrol station
not too many miles away.
VALDES-DAPENA: Yes, it is always easy to find a petrol station these days. And what we want to do here or they want to do is try to make it as easy as
that to find --
QUEST: But --
VALDES-DAPENA: A charging station.
QUEST: But doesn't --
VALDES-DAPENA: But there's a difference, remember, when you fill your car with gas, that's a thing you go and do. A charging station is usually you
want to charge your car where you're stopping anyway. So at a rest stop, at a shopping mall, somewhere where you're going to leave your car for a
while anyway, that's where you want to charge your --
QUEST: And this is -- and Bechtel have a lot of experience of major construction. But --
VALDES-DAPENA: Indeed --
QUEST: But how many are they going to build and where?
VALDES-DAPENA: Well, right now, they're not saying where, they're not giving exact numbers. But they've said they're going to build out
thousands of charging stations which would make it certainly I think one of the largest charging networks in the U.S.
QUEST: Why is GM doing it with Bechtel? Why isn't this something that the industry is doing? Surely, you would get much more heft if you know, Ford,
FCA, GM, BMW, everybody is saying look, we're all going to need these things in the future, let's all do it together.
VALDES-DAPENA: Maybe they will because right now, one thing they both said interestingly is that neither one of them is putting money into their --
their own money into this.
[15:55:00] Bechtel is putting its construction expertise, GM is putting all the data it has about where the chargers are going to need to go
because they know that. And they're inviting other companies to invest. So there could be a number of other companies, maybe other automakers that
will invest in this.
QUEST: I need to go and look and close the markets, the day is nearly done. Join me over here, and we see Intel is the laggard, down 2.2
percent. You have Visa at the top, very interesting, but notice the gains are relatively small. In fact, they've dwindled that just in the low
The gains are small, the losses are extending. And you've got companies like P&G, Exxon which are the -- Goldman Sachs which are the main losers.
So that's weighing heavily, some big ones. But not the biggest names, Boeing is probably keeping up the back-end of the market.
And the overall -- well, it's -- we're just off the lows, the low is about 200 points. It is the way the market just drifted throughout the course of
the day. You had this middle area and we are going to be done at the close. The close of play happens in just five minutes from now.
A down day on the Dow. We will take our profitable moment after the break.
QUEST: Tonight's profitable moment, we started of course with Richard Haass with that very sobering warning on polarization. And you can't help,
but ignore it, whether it's in Europe with the elections that have taken place or it is in the United States with Donald Trump's comments or in
India or -- does it really matter where?
Choose your own theater of geopolitical ferment at the moment. The warning is there, the two sides are polarized and what is worse, petrol is being
poured on the flames. And that is a warning that cannot be ignored. When you get people like Richard Haass, well, telling us about it, it's
something we need to take seriously.
Because the truth is nobody seems to have an answer. All the established political parties are going around in the same ever decreasing circles and
it's one subject, frankly, that business leaders want to go nowhere near. Which they're going to have to in the future.
And that is QUEST MEANS BUSINESS for tonight, I am Richard Quest in New York, whatever you're up to in the hours ahead, I hope it is profitable.
The bell is ringing, the Dow is down, worst of the day, the day is done.