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EARLY START

Cruise Ship Passengers Stuck Waiting for Test Kits; Traumatized Children Endure Bombings in Syria; Israel Heads to a Fourth Election. Aired 4:30-5a ET

Aired March 6, 2020 - 04:30   ET

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


[04:30:08]

PHIL MATTINGLY, CNN ANCHOR: Growing anxiety on a cruise off California. Coronavirus tests due back today. Passengers can't even leave their rooms.

CHRISTINE ROMANS, CNN ANCHOR: The rollercoaster just won't end on Wall Street. A huge tumble wipes out most of Wednesday's historic gain. What's in store with the jobs report today.

(BEGIN VIDEO CLIP)

MARTHA MACCALLUM, FOX NEWS ANCHOR: But if you don't cut something in entitlements, you'll never really deal with the debt.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We'll be cutting, but we're also going to have growth like you've never had before.

(END VIDEO CLIP)

MATTINGLY: The president with what sounds like a seismic shift on entitlements. How will it play in key states eight months until the election?

ROMANS: And sharp criticism of the attorney general's candor and credibility not by Democrats but by a federal judge.

MATTINGLY: Welcome back to EARLY START. I'm Phil Mattingly.

ROMANS: And I'm Christine Romans. It is 30 minutes past the hour this Friday morning with Phil in New York.

MATTINGLY: We made it.

ROMANS: We made it.

MATTINGLY: It's Friday.

ROMANS: We haven't made it yet.

MATTINGLY: We're almost there.

ROMANS: We've got a lot to go. We've got a lot to go. All right. The sobering reality as coronavirus cases grow rapidly in the U.S. and

around the world, a top infectious disease doctor says there is still not a full understanding of the virus' fatality rate. The World Health Organization has reported the virus may kill as many as 34 out of 1,000 people. But at a CNN global townhall last night, Dr. Anthony Fauci said the calculation is based on limited information.

(BEGIN VIDEO CLIP)

DR. ANTHONY FAUCI, DIRECTOR, NATIONAL INSTITUTE OF ALLERGY AND INFECTIOUS DISEASE: The range is lower than that. How much lower, it's uncertain. Until we have a much more accurate determination of who is infected, including those who are asymptomatic, we will not get a more accurate determination of what the case fatality rate is.

(END VIDEO CLIP)

ROMANS: Fauci said the world will need millions and millions and millions of tests for coronavirus and he acknowledged testing got off to a slow start.

MATTINGLY: The administration's point man on coronavirus response, Vice President Mike Pence, traveled to Washington state yesterday, modeling good infection control by bumping elbows with Governor Jay Inslee instead of shaking hands. And on the subject of testing earlier in the week, Pence said this.

(BEGIN VIDEO CLIP)

MIKE PENCE, VICE PRESIDENT OF THE UNITED STATES: Any American that wants to be tested for the coronavirus on their doctor's indications can be tested.

(END VIDEO CLIP)

MATTINGLY: But yesterday Pence acknowledged what has become obvious.

(BEGIN VIDEO CLIP)

PENCE: We don't have enough tests today to meet what we anticipate will be the demand going forward.

(END VIDEO CLIP)

MATTINGLY: But Pence now claims 1.2 million testing kits will be shipped nationwide by the end of this week, though actually testing patients will take longer.

ROMANS: Meantime, the World Health Organization is ringing the alarm saying, quote, "This is not a drill. Countries have been planning for scenarios like this for decades. Now is the time to act on those plans." A WHO doctor tried to ease concerns on last night's CNN town hall.

(BEGIN VIDEO CLIP) DR. MARIA VAN KERKHOVE, WHO INFECTIOUS DISEASE EPIDEMIOLOGIST: What is really interesting about this virus is that many countries, not just China, but China is the largest example we've seen that we can slow this down. This is a controllable virus and that's a really important message. It's not uncontrollable.

(END VIDEO CLIP)

ROMANS: The number of confirmed infections worldwide now nearing 100,000. The death toll over 3300.

MATTINGLY: The lab test results from 45 people on the Grand Princess cruise ship are expected back today. There are nearly 3500 people on board and the ship is stranded off the coast of San Francisco. Officials refused to allow it to dock because its last voyage included a passenger who became California's first person to die from coronavirus. The California National Guard delivered test kits and medical personnel. Every passenger has been told to remain in their cabins until further notice and to not expect any frills.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We're in discussions with the CDC regarding time for guests to access the open deck for fresh air and exercise. We are working to have more details to share with you tomorrow. As you are now aware, we did not offer turndown service this evening as an overabundance of caution.

(END VIDEO CLIP)

MATTINGLY: Looks like turndown service probably the least of their worries right there.

ROMANS: Right.

MATTINGLY: The death of a 72-year-old man from the Bay area is now under investigation. He was recently on the same cruise ship. And Google is now giving its Bay area employees the option of working from home.

ROMANS: All right. You know, rollercoaster is a terrible cliche in markets, except it actually fits this time. A rollercoaster trading week, investors weighing the economic impact of coronavirus and the consistency of the government response, quite frankly, and the tone coming from the White House.

The Dow finished down nearly 1,000 points. That's the fifth worst point drop ever in a single day. I want you to look at over the past 11 days. It was a whipsawed. How many of those days it's more than 1,000 points or nearing a thousand points. It's just remarkable.

Now the S&P and the Nasdaq both closed down more than 3 percent and the 10-year treasury bond -- this is really important, Phil, you know better than anybody. The 10-year bond, 0.9 percent, the yield.

[04:35:03] That's because investors right around the world are flocking out of everything and moving into the safety --

MATTINGLY: That's a wild number.

ROMANS: It's just --

MATTINGLY: And 0.9 percent is wild.

ROMANS: That's history you're watching there, folks. And it shows the anxiety in the global markets.

Now, the best-performing stock on Thursday, Kroger. The grocery chain said it was benefitting as consumers are stockpiling pantry essentials.

Take a look at markets around the world right now. Another grim kind of end to the week. Tokyo, Hong Kong, Shanghai all closed down. European shares then opened down, and U.S. futures down.

Southwest Airlines CEO Gary Kelly says the outbreak is delivering a gut punch to the airline industry. This is what he says. "This is isn't economic in the sense that people want to travel but they can't afford to. We could discount prices tomorrow and it wouldn't do any good."

Costco has had its sales rise due to panic shopping. Starbucks predicts a 50 percent sales drop in China because of coronavirus. And again U.S. futures down a little bit right now. But we have a jobs report coming up so everything could change in a few hours.

MATTINGLY: Which just seems like basically the theme of the last three weeks.

ROMANS: Election year unpredictability, it is here to stay.

MATTINGLY: Indeed. Speaking of election year, President Trump is backing away from his promise not to cut Social Security and Medicare. At a FOX News town hall in Pennsylvania last night the president says entitlements are -- appears are -- on the chopping block.

(BEGIN VIDEO CLIP)

MACCALLUM: If you don't cut something in entitlements, you'll never really deal with the debt.

TRUMP: We'll be cutting, but we're also going to have growth like you've never had before.

(END VIDEO CLIP)

MATTINGLY: "We will be cutting," the sentence that launches a thousand Democratic campaign ads. Just last month the president tweeted, "We will not be touching your Social Security and Medicare."

The Democratic frontrunner Joe Biden was quick to respond tweeting, quote, "Here's the deal, folks. Social Security is on the ballot this year and the choice couldn't be clearer. I'll protect and expand it. Donald Trump will cut it and take it away."

ROMANS: So that's where Bernie Sanders enters the fray. Now instead of going after Trump, he targeted Joe Biden. "Here's the deal. Joe Biden has repeatedly advocated for cuts to Social Security. I have fought my whole career to protect and expand it."

The Democratic contenders kept the Twitter beef going for a bit and then apparently called it a night.

MATTINGLY: Because they fell asleep.

ROMANS: I guess so.

MATTINGLY: That's how Twitter -- it's the only way they end.

Speaking of politics she was once a frontrunner, now Elizabeth Warren is out of the Democratic race for president. A poor showing on Super Tuesday which included a third place finish in her home state of Massachusetts. Senator Warren said she is not ready to endorse one of her rivals. The Democratic field was once the most diverse in history including six women.

(BEGIN VIDEO CLIP)

SEN. ELIZABETH WARREN (D-MA), FORMER PRESIDENTIAL CANDIDATE: Gender in this race, you know that is the trap question for any woman. If you say, yes, there was sexism in this race everyone says whiner. And if you say, no, there was no sexism about a bazillion women think what planet do you live on?

I promise you this, I will have a lot more to say on that subject later on.

(END VIDEO CLIP)

MATTINGLY: Yes, I think she certainly will. The Democratic race is for all intents and purposes now down to two white men in their 70s, Bernie Sanders and Joe Biden. The only other candidate, Congresswoman Tulsi Gabbard, has not been polling above 1 percent.

ROMANS: All right. Facebook is removing Trump campaign ad that it says violated Facebook's policy aimed at preventing interference in the 2020 U.S. Census. The ads on Facebook asked people to respond now to the official 2020 congressional district census. It included questions about their views of President Trump and directed users to a fundraising site to support his re-election.

Facebook and other social media platforms are under increased scrutiny to prevent disinformation in ads during the 2020 election season.

MATTINGLY: A federal judge sharply questioning Attorney General Bill Barr's candor and credibility in his handling of last year's Mueller report. Judge Reggie Walton, never a shrinking violet, ordering the Justice Department to let him review the un-redacted Mueller report in response to a Freedom of Information lawsuit filed by BuzzFeed and a watchdog group.

Now Walton, who was appointed by a Republican president, called Barr's summary of Mueller's main conclusions, quote, "misleading," echoing Mueller's own objections at the time. Barr told Congress and the public Mueller found the Trump campaign did not conspire with Russia. Barr also said the Justice Department determined the president had not obstructed justice.

ROMANS: Former president Bill Clinton reflecting emotionally about his affair with Monica Lewinsky back in the 1990s. Their relationship and Clinton lying about it during a deposition led to his impeachment.

(BEGIN VIDEO CLIP)

BILL CLINTON, FORMER U.S. PRESIDENT: I feel terrible about the fact that Monica Lewinsky's life was defined by it. Unfairly, I think. You know, over the years I've watched her try to get a normal life back again. But you've got to decide how to define normal.

(END VIDEO CLIP)

ROMANS: Clinton says it was one of the many things he did to cope with pressure and disappointments.

MATTINGLY: Yes. Former first lady Hillary Clinton opens up about how devastated she was.

(BEGIN VIDEO CLIP)

[04:40:02]

HILLARY CLINTON (D), FORMER PRESIDENTIAL CANDIDATE: I can't believe you lied. You know, it just anyway was horrible, and I said if this is going to be public you have got to go tell Chelsea.

B. CLINTON: She said, well, you have to go tell your daughter. She said that's worse than me. And so I did that, which was awful.

(END VIDEO CLIP)

MATTINGLY: Now those revelations are from "Hillary," a new four-part Hulu docu-series that traces the former first lady and 2016 Democratic nominee's life and career.

ROMANS: You just close your eyes in that moment in time in American politics and American life in the '90s, just -- it's right there.

All right, a cease-fire in the last opposition enclave in Syria through the smiles of children. There are big questions about how to keep lives safe.

CNN's Arwa Damon reports from Syria next.

(COMMERCIAL BREAK)

[04:45:12] ROMANS: Turkey and Russia announcing a cease-fire in Idlib Province, the last rebel stronghold in Syria. What's not clear is how the cease- fire will be enforced. The deal is not likely to end the suffering in Idlib or contain a growing humanitarian crisis. The situation remains dire even through occasional smiles.

CNN's Arwa Damon has more.

(BEGIN VIDEOTAPE)

ARWA DAMON, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): The children's smiles belie the depth of their trauma. The school is one of many sheltering the displaced. The blaring music temporarily drowning out the sounds of the explosions on the frontline just a 15- minute drive away. Even at their tender age they know death can come in an instant.

Dara (PH) is trying to have fun, gingerly keeping her weight off her injured foot.

"I was eating an apple with my sister and then the rock hit us," she remembers. "I looked and I could only see dust and blood."

That strike happened a week ago at the school just next door where Dara's family along with others were living. A rocket slammed into the schoolyard killing seven children and wounding many more. Dara's father shows us her bandaged foot, grateful his daughter is still alive, agonizing over how he is supposed to even protect his children.

"I am used to the sounds of the planes hitting," Dara says. "But since we got hit I'm scared of it."

(On camera): They've been training the kids on what to do if they hear explosions or the bombings coming close. So one is shelter in place and then the other, though, is to follow the arrows painted on the walls to go towards the bunker.

(Voice-over): It's not a real bunker, just a room underground that used to store the now dust covered schoolbooks. The skies outside the town are painted with the streaks of fighter jets. In the early hours the next morning a chicken farm being used to house the displaced was decimated crushing many of those who sheltered there in their sleep including children.

Hospitals are overwhelmed dealing not only with illnesses and disease but the constant flow of the wounded. There is no sanctity here, least of all for civilian life.

In the last month Turkey has upped its military involvement, battering regime positions. This group of fighters close to the front is mostly made up of young men who were in high school when Syria's revolution turned into a war.

"The Turkish presence is preventing the regime from advancing on the ground," 26-year-old Abusad (PH) says. "Our fight is about defending the population, my wife, my children." But how to truly protect this population? It's not really in these

fighters' control. It's in Turkey and Russia's hands. They the main two powers bartering for Idlib's fate.

No matter what is negotiated there have been too many promises, too many broken cease-fires, too many sham agreements. Pain haunts every street.

(On camera): His son died right here. That's his blood on the wall.

(Voice-over): Mohamed was just 12. His older brother tells us they ran when they saw the plane but Mohamed didn't make it.

"I tried to pick him up but I couldn't," Hussein remembers. Mohamed died in his arms.

Even celebrations are bittersweet. These women are shopping for dresses for their relatives' wedding but it won't be a lavish affair.

"It's not the sort of happiness where you invite everyone," the groom's sister tells us. "It will be small with immediate family. There's just too much misery and fear that a big crowd will get bombed."

Since December around a million have been displaced cramming into any empty space they can find, even this prison. The families here sleep with their clothes on not knowing when they might need to run out.

Marin's (PH) father was killed fighting years ago. "He used to play a lot with us when he was alive," she remembers.

As we leave we come across what's known as the graveyard camp. For even the dead are displaced buried as close as possible to the border with Turkey in the hopes that at least they can rest in peace.

Arwa Damon, CNN, Idlib, Syria.

(END VIDEOTAPE)

[04:50:01]

ROMANS: We're so fortunate to have Arwa there able to tell those stories for us.

MATTINGLY: Yes.

ROMANS: Those important stories.

MATTINGLY: Absolutely.

ROMANS: All right. Thinking about refinancing your home? Guess what, now is a very good time. You will not believe mortgage rates here. CNN Business has the numbers next.

(COMMERCIAL BREAK) MATTINGLY: Three times may not be the charm in Israel's elections. The country appears headed for another political stalemate. With all the votes counted Prime Minister Benjamin Netanyahu's party has the largest voting bloc. Once again he's short of the majority needed to govern. What's different this time, his opposition is uniting in a bid to bring him down.

[04:55:03]

Oren Liebermann has the latest developments live from Jerusalem.

And Oren, I'm happy I have you. I was texting with people in the administration yesterday trying to figure out what exactly was going on here. It seemed a little bit wild. Can you explain?

OREN LIEBERMANN, CNN CORRESPONDENT: Well, this is where Israeli politics has been for more than a year now with the very real possibility that this country is headed for a fourth election in September which is unprecedented. But so has been -- so has the last year in Israeli politics.

Here's where the numbers stand. These are final but unofficial results as a handful of polling places are checked and double-checked. Prime Minister Benjamin Netanyahu has the biggest party of 36 seats but his bloc of right-wing and religious parties is at 58. That's three seats short of the 61 needed to govern. And that is a very big three seats in this political environment right now.

Meanwhile his rival, Benny Gantz, has 55 seats, again still short of what's needed to govern here. Those other seven seats, those are the political kingmaker and he has not picked a side at this point and that's where all of the uncertainty comes in.

Netanyahu it seems safe to say at this point does not have a government. Gantz could try to go for a minority government but, first, that may well be impossible, and second, it requires political skill that he frankly has not yet shown in this environment.

Meanwhile the opposition parties are trying to advance a law that would make it illegal for a person under indictment to serve as prime minister. Don't forget Netanyahu's trial on corruption charges starts in just two weeks. But it's unclear if they can even do that in the timeframe they have.

Meanwhile, Netanyahu claims victory on election night on Monday night. He claimed victory again on Wednesday night saying he has the majority of Zionist votes in this country. Saying the Jointness of our parties doesn't figure into this equation. The head of Jointness fired back saying on Twitter, Netanyahu wouldn't recognize democracy if it served him three indictments and prevented him from forming a government three times.

Phil, harsh words as Israel may be well headed for certain political deadlock and more elections.

MATTINGLY: Oren Liebermann in Jerusalem with the head spinning and seemingly never-ending story. Thanks a lot, friend. Appreciate it.

All right. We have some hair-raising body cam footage this morning. Two New Jersey state -- just watch this. State troopers pulling the driver of a burning tractor-trailer from his rig just seconds before it explodes.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Go, go, go.

UNIDENTIFIED MALE: Are you all right? Are you all right?

(END VIDEO CLIP)

MATTINGLY: Unbelievable pictures. Unbelievable courage. Officials say Trooper Robert Carlton interrupted a roadside stop when he saw the tractor-trailer run off the highway in Bridge Water Township. He ran to the truck where an off-duty trooper Lieutenant Ed Ryan was already helping. The driver sustained minor injuries.

ROMANS: Gosh, every day these amazing stories of first responders.

MATTINGLY: It's unbelievable.

ROMANS: Just wild.

All right. Let's get a check on CNN Business this morning. First a look at markets around the world. Looking grim to end what has been an insane week. And that's a technical term, insane. You have Asian shares actually closed lower, Europe is now open and it is also lower. On Wall Street futures are leaning down again here, continuing the trend from yesterday.

Couple of things here, worries about the coronavirus once again spurring a sell-off in stocks, in a couple of different reasons. We're learning more about the effect on business. We're also feeling this unease about the response and the consistency and the message from the administration about just how -- how dire this whole thing is and if they are capable of meeting the challenge.

The Dow fell 970 points, the fifth worst single day point drop on record. More on this in just a few minutes, but look at this, mortgage rates have also hit a record low. The average 30-year fixed rate mortgage fell to just 3.29 percent, the lowest in the nearly 50 years we've had this product.

According to Freddie Mac, these are those numbers, the 15-year fixed rate mortgage, 2.79 percent. Rates fell after the surprise rate cut from the Federal Reserve to help nudge the economy along with the coronavirus outbreak worsens. Some analysts say mortgage rates could have even more room to fall further.

All right, today's February jobs report expected to show strong gains across the board. Economists expecting 175,000 jobs added last month. The unemployment rate likely staying close to 3.6 percent. That's near a 50-year low. Strong jobs report could ease some concerns over slower growth because

of coronavirus. Though much of the impact will be seen in next month's job reports. This is sort of like the last big report before we realize how serious the outbreak is. It is hitting consumer spending hard here as people stop shopping, going to movies, concerts and travel.

MATTINGLY: All right, EARLY START continues, guess what, right now.

ROMANS: Growing anxiety on a cruise off California. Coronavirus tests are due back today. Passengers can't even leave their room.

MATTINGLY: And the rollercoaster that won't stop on Wall Street. A huge tumble wiping out most of Wednesday's historic --

[05:00:00]