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House Dems Unveil Relief Package; Report on Jobs Lost Will Never Come Back; Grocery Costs see Big Spike; Gov. Ned Lamont (D-CT) is Interviewed about Reopening; Supreme Court Hears Electoral College Cases. Aired 9:30-10a ET

Aired May 13, 2020 - 09:30   ET



MANU RAJU, CNN SENIOR CONGRESSIONAL CORRESPONDENT: See what happened and how the -- already the $3 trillion that has already been appropriated through various programs, just this spring alone, how that is being implemented before agreeing to another package. Democrats say there is no time to waste, which is why the House Speaker, Nancy Pelosi, behind the scenes for weeks has been putting together this proposal that they unveiled just yesterday.

And it would itself cost more than $3 trillion, which would be the largest relief package in American history, dealing with everything from providing more unemployment benefits up to $600 of federal unemployment benefits through next January, including up to $6,000 for families for direct assistance. It would also increase food stamp assistance, provide a trillion dollars to state and local governments and the like.

But Republicans are divided about whether there should be any next step, some don't believe that there should be any more aid to state and local governments. Other are pushing that. But, Jim, before this all happens, Nancy Pelosi has to navigate some divisions within her own caucus. Some progressive leaders are saying there needs to be more for the jobless benefits. They need to push forward on that. So she'll have to resolve those as they try to push this out of the House by Friday.


JIM SCIUTTO, CNN ANCHOR: Yes, and, of course, you got a Republican- controlled Senate on the other side.

Manu Raju on The Hill, thanks very much.

POPPY HARLOW, CNN ANCHOR: So, on top of that debate, devastating predictions this morning. Goldman Sachs now says unemployment will peak at 25 percent. That is one in four working age Americans out of a job. And the bank says real unemployment, it counts those underemployed, that will hit 35 percent. That would surpass the record set in the Great Depression. This as a stunning new white paper comes out of the University of Chicago saying 42 percent of the jobs already lost will never come back. Steven Davis authored that. He is with me now and a professor of

economics at the University of Chicago.

Thank you so much for being here.


HARLOW: I couldn't -- I reread that line in your paper over and over and tried to comprehend what it would actually mean for our country if 42 percent of the jobs lost never come back. And now Jerome Powell, moments ago, the Fed chair, just said 40 percent of households earning less than $40,000 a year lost their jobs in March.

Does that portend that this recession could become a depression?

DAVIS: Well, it certainly makes clear the extent of the challenge before us. And I think it also suggests, certainly to me, that we need to redirect our policy initiative towards creating new jobs to replace the ones that aren't coming back. And there's two -- actually two pieces of good news amidst all this bad news in that respect.

HARLOW: Oh, we lost him. OK, should we take a break and come back? All right, let me -- let me go to Jim.

SCIUTTO: All right, it happens. In the age of stay at home, sometimes the technology doesn't work. We're going to bring him back as soon as we can.

Another story we're following, Americans are getting slammed at the grocery store -- you might have seen this -- as prices for some of the basics have jumped dramatically. According to Labor Department, staples such as eggs, meats and cereal had the biggest increase in nearly 50 years. That matters to families. I mean families, many of whom aren't working right now.

CNN national correspondent Dianne Gallagher joins us now.

How extensive and what is the government doing about this? I mean it's price gouging, is it not?

DIANNE GALLAGHER, CNN NATIONAL CORRESPONDENT: Yes and no. Here's the thing, Jim, we're talking a 2.6 percent increase in the price of groceries in the month of April alone. So you weren't imagining that it felt like you were paying more getting those groceries.

And we've talked a lot about meat, but it was eggs that saw the biggest jump there, 16 percent. Now, the reasons vary. Everything from demand has increased, we're cooking more at home, we're buying more groceries at home, to what we did see with the meat supply and that bottleneck in the food supply chain at the processing center. And, look, we're talking about reopening. That doesn't mean these prices are going away.

Take a listen.


DAVID ANDERSON, PROFESSOR AND EXTENSION ECONOMIST, DEPARTMENT OF AGRICULTURE ECONOMICS AT TEXAS A&M: I think it's pretty clear that even as plants fully open, we're going to be running at slower speeds, which keeps tighter supplies and higher prices. I think -- I think for the future, for the rest of the year, and quite honestly even into next year, we're probably -- we're going to be talking about higher food prices.


GALLAGHER: Now, look, prices in general outside of the grocery store actually fell last month in the U.S. So economists say that it was offset a bit with that increase in groceries.

But, look, Jim, so many people are out of work right now, paying that 2.6 percent more overall. And we're talking every food group here increased in some level. So paying more at the grocery store is hard for Americans who, right now, are trying to make every single dollar count.


Economists have said that it is possible that we could see some of those food groups dip again once things get a little more close to normal and restaurants start opening back up again. We start buying less at home. But some of those, as you heard, may be here to stay, at least through the end of the year as the food supply chain continues to work out kinks.

SCIUTTO: Yes. Understood. Those kinks and demand rather than price gauging, important distinction there.

Dianne Gallagher, thanks very much.

Well, Connecticut's governor has replaced the state's top health commissioner just days before beginning the reopening process there. The governor is going to join us next. Lots of questions, tough decisions coming across the country.



HARLOW: All right, University of Chicago Economic Professor Steven Davis is back with us.

Sorry about that technical glitch. I'm glad we have you now.

But you were just saying policies done right can help this not become a depression. What policies? Are you thinking something like a new deal 2.0, a federal jobs guarantee program, or something else?

DAVIS: No, I think something much more mundane than that. First, and obviously we have to continue ramping up testing and contact tracing so that we can control the virus outbreaks. Second, smaller businesses in particular, they need assistance from national and local authorities in terms of what they need to do to make their places of work and their interactions with customers as safe as possible. Big companies like Starbucks can learn from their experience in China, bring that to the United States, but smaller companies don't have those resources.


DAVIS: They need the government give them that information.

The third thing is we need to lock down barriers to creation of new jobs. You mentioned, Poppy, that Jerome Powell said that something like 40 percent of low income Americans have lost their jobs in recent weeks. Well, it's hard -- a lot of those low income Americans are affected by occupational licensing restrictions that restrict who can work in jobs like sign language interpreters, tree trimmers, dog groomers, hairstylists. We need to knock down those barriers so that we can create new jobs for those folks who have lost their old jobs.

HARLOW: Steven, how did you get to this number that 42 percent of the jobs lost so far may never come back? How do you know?

DAVIS: Well, we did -- we estimated that number in two steps. First, I, along with folks at the Federal Reserve Bank of Atlanta, run a survey that the Atlanta Fed fields that simply asks businesses, OK, how many people did you lay off in the last several weeks and how many of those layoffs do you think are permanent? How many temporary? And then we added to that the number of temporary layoffs that historically did not result in recalls. We put those two things together. That's how we came up with this 42 percent figure.

HARLOW: Wow. Well, given that, is it a guarantee, Larry Kudlow, White House economic adviser, just said on Sunday that the second half of the year is going to be pretty spectacular and we'll see, quote, probably 20 percent economic growth.

Is that a guarantee?

DAVIS: It's not a guarantee. It might happen. But it's very important to understand, you start out here, you go way down here, you come part way back and that looks like a lot of growth, and it is, but it doesn't take you all the way back to where you were.


DAVIS: So I think that's the -- that's the positive scenario for the United States, that we do have a lot of growth in the second half of the year, but we're still well short of where we were before the pandemic hit. I think that's the optimistic scenario (ph).

HARLOW: That's a very important reality check for so many people.

Professor Steven Davis, thanks -- thanks so much. I appreciate it.

DAVIS: Thank you, Poppy. SCIUTTO: Well, it is just days before the state of Connecticut plans to begin reopening. The governor there replaced Renee Coleman- Mitchell, that's the chief person in charge of the state's health commission during this pandemic. This comes as the overall death toll in Connecticut hit 3,000 this week. The state also reported recent downward trend on hospitalizations and confirmed infections.

With me now, Connecticut Governor Ned Lamont.

Governor, thanks so much for joining us. Again, it's good to have you back on the program.

GOV. NED LAMONT (D-CT): Hey, good morning, Jim, nice to be back.

SCIUTTO: I want to play the warning that Dr. Anthony Fauci shared yesterday in the congressional testimony and just get your reaction to it as you make these decisions. Have a listen and we'll get -- we'll hear your thoughts.


DR. ANTHONY FAUCI, DIRECTOR, NATIONAL INSTITUTE OF ALLERGY AND INFECTIOUS DISEASES: Is my concern that if some areas, cities, states or what have you jump over those various checkpoints, and prematurely open up without having the capability of being able to respond effectively and efficiently, my concern is that we will start to see little spikes that might turn into outbreaks.


SCIUTTO: Listening to that there, are you confident that Connecticut has the capability to respond to any increases in cases and hospitalizations as you reopen?

LAMONT: Yes, I'm confident, and I think Dr. Fauci would be confident as well because we have hit the metrics that he laid out as important. Hospitalizations down. We have now 40 percent capacity. Virtually all of our hospitals. So if there was a flare-up, we make sure we can take care of people. We're doubling our testing again next week. We got the biggest stockpile of PPE, really in the region's history, just yesterday. So we got a two months stockpile. I can give masks to a lot of our smaller businesses, give them -- their employees confidence that they can go back safely. And over time I think it will take time for the consumer it feel confident going back into that store.


SCIUTTO: Yes. Let me ask you to articulate, and not just for the residents of Connecticut, but other folks around the country, what the actual goal is here, because early on in the stay at home orders, et cetera, the goal was flattening the curve, right? So you don't have a giant jump in cases, but not to eliminate infections because, at the end of the day, more people are going to get infected. I suppose it's how you react to it unless people stay at home until there's a vaccine. What is the goal? I mean -- and is part of reopening accepting to some degree that more people will get infected? LAMONT: Look, I cannot eliminate risks. There will be some risks, but

I think we've mitigated it. I think we're giving people confidence that we've got it under control. If there were a flare-up at a nursing home or we -- we're ready to respond to this in an aggressive way so we can tamp down the flare-ups. Track and trace, that's like the fire department, right? They go it the flare-up and they contain the blaze.

SCIUTTO: Understood.

OK, let's talk about schools because parents around the country, they're watching these decisions for the fall very closely. I mean it's about their kids, but it's also about the parents because if the kids aren't going to school, right, what do the parents do as they begin to go back to work?

What standard are you using in Connecticut to feel safe that it's -- that it's OK to send kids back to school, both at the younger level, elementary school, high school, et cetera, but also for colleges and universities?

LAMONT: Yes, we're very cautious. As you know, we did not allow in classroom learning to continue through the end of this school year. You know, sometime in July we'll have outdoor camps, they're outdoors, smaller groups. Maybe summer school as the summer goes on so we can slowly get our kids back up to speed.

And then we look at the facts on the ground and I'm confident, or at least I should say I'm hopefully confident that we can get those schools going again in the fall.

And when it comes to colleges like you said, sort of the same metric as we go forward, you know, residence halls are probably the last decision you make because that's -- that's close quarters.

SCIUTTO: Yes. Understood. And I know that's going to be a real challenge, can you do dorm life on college campuses in the age of an outbreak, at least before a vaccine? But for parents who are listening, both parents of younger aged children in Connecticut, but also parents who might have kids going to college there, are you saying, listen, we're hopeful schools will be open in the fall?

LAMONT: That is correct. Probably smaller classrooms, more distancing, teacher probably wearing a mask, taking care of these key precautions early on and we'll see how it sorts from there.

SCIUTTO: OK, Governor Ned Lamont, we wish you, we wish the people of Connecticut good luck as you get through this.

LAMONT: Thank you, Jim.

HARLOW: In just minutes, the Supreme Court will begin hearing two cases that could shake up the Electoral College. We'll have more on that next.

And from Oprah to O.J. to the president, the "National Enquirer" got the scoop on scandal. Now a new CNN film uncovers the dirty truth on America's largest tabloid "Scandalous," a CNN film, it airs Sunday night, 10:00 Eastern.



HARLOW: In just minutes, the Supreme Court will hear oral arguments once again today over the phone, which is remarkable in and of itself. These two cases are ones that could impact the election in November.

SCIUTTO: The justices are set to decide if states can punish or remove so-called faithless electors, those are members of the Electoral College who can decide not to vote for the nominee who won the popular vote in each respective state.

CNN's Jessica Schneider joins us now with more.

Jessica, what are we learning and what should we be watching for?

JESSICA SCHNEIDER, CNN JUSTICE CORRESPONDENT: Well, you know, Jim and Poppy, we all know how important the Electoral College is, of course, to the presidential race. So the question is, you know, what happens when these individual electors in their states don't actually vote for the candidate in their party who won the state. Believe it or not, it actually happened ten times in 2016. Ten of the 538 electors, they went rogue. In fact, in Washington state, three of the electors tried to vote for former Secretary of State Colin Powell, who wasn't even on the ballot, instead of Hillary Clinton. In Colorado, there was one elector who tried to vote for the Republican Ohio Governor John Kasich instead of Hillary Clinton. Now, in both of those states, those electors were actually fined.

So the question is, you know, can states punish or fine these electors? And the decisions in these lower courts are split. In Colorado -- actually in Washington state, the Supreme Court said, yes, you can fine these electors. However, in Colorado, a federal appeals court there said, no, fining these electors, punishing them, is unconstitutional. So that is the question that will go before the Supreme Court today.

Of course, a very interesting case in the midst of the 2020 election. And, of course, we've seen how important the Electoral College is, where, of course, in 2016, Hillary Clinton winning the popular vote, but President Trump, of course, ultimately prevailing when it came to the Electoral College.


HARLOW: Jes, before you go, let's talk about yesterday. I mean two huge, huge arguments yesterday over whether the public has the right to see financial documents of the president or whether he is -- will get basically presidential immunity. Any sense from the questions that were asked by the justices and the way the argument went on where things are leaning?

[09:55:00] SCHNEIDER: These justices actually really pushed back against this idea of temporary presidential immunity that was pushed by the president's attorney, Jay Sekulow. Even the conservative justices really seemed troubled by this argument that the president is immune. I mean they pointed to the precedent here, of course, with the subpoenas being upheld against President Nixon getting the Watergate tapes. They even talked about the Paula Jones case with President Clinton, saying that the sexual harassment case against him could move forward, so why, in fact, would this president be different?

The justices seemed a little bit more amenable to the president's arguments when it came to the House case and saying that maybe that could amount to presidential harassment, trying to get all the financial documents.

So, Jim and Poppy, it's possible here that when we see the ultimate decision, it could be split and they could actually maybe enact some sort of heightened standard for the Manhattan D.A. as to getting these financial records, and that could mean that this could continue to play out in the lower courts where the D.A. would have to prove this heightened standard to actually get the financial records, which might push any sort of disclosure of them until after the election, which would mean that the public still might not see the financial records or the tax returns anytime soon.


SCIUTTO: Yes, that has its own significance politically as well.

Jessica Schneider, thanks very much.

There are strong warnings as the nation, many states across the country, most of them, look to reopen, as experts suggest that the bottom line is more Americans could die from coronavirus as that happens.