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Los Angeles Mayor Says Our Restrictions Will Evolve; U.S. Reopening Overshadowed by New Virus Projections; Fauci is Concerned Little Spikes May Become Outbreaks; Debate Rages Over How and When to Reopen Economies; Boeing Deliveries Drop as Canceled Order Climb; Twitter Says Some Employees Can Work from Home Forever; Top U.S. Diplomat Arrives in Israel Amid Virus Crisis; Celebs Offer Words of Encouragement to 2020 Grads. Aired 4:30-5a ET

Aired May 13, 2020 - 04:30   ET

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


[04:30:00]

ROSEMARY CHURCH, CNN ANCHOR: Welcome back. Well, the largest county in the U.S. plans to extend its lockdown for at least three months. Health officials in Los Angeles County say while some restrictions will be loosened and lifted, some form of a stay-at-home order will remain in place. Several of the county's biggest universities say students are unlikely to be back in person this fall.

On Tuesday, Los Angeles Mayor Eric Garcetti tried to reassure his residents. He outlined the next steps on CNN.

(BEGIN VIDEO CLIP)

ERIC GARCETTI, LOS ANGELES MAYOR: We're still going to need to wear facial coverings. We're still going to need to physically distance. What we did do is we moved toward this weekend opening up our trails. We made sure that there's curbside pickup at five different categories of retail stores. Today the county announced, we concur, that that will expand to all retail, that beaches will open up this week for exercise and active recreation only. Every two or three weeks, we can assess those steps. If the numbers stay stable as they are here in Los Angeles, great. We've earned that and can build on that.

(END VIDEO CLIP)

CHURCH: And by the end of this week, all but two states in the U.S. will have started reopening. Now a key model from the University of Washington is projecting that due to explosive increases in mobility, the death toll in the U.S. could be much worse. CNN's Nick Watt has our report.

(BEGIN VIDEOTAPE)

SEN. ELIZABETH WARREN (D-MA): I'd just like to hear your honest opinion. Do we have the coronavirus contained?

DR. ANTHONY FAUCI, DIRECTOR, NATIONAL INSTITUTE OF ALLERGY AND INFECTIOUS DISEASES: Depends what you mean by containment. If you think we have it completely under control, we don't.

NICK WATT, CNN CORRESPONDENT (voice-over): Testifying to distanced or dialed-in Senators today, a dose of reality from the nation's now most-recognizable doctor.

FAUCI: My concern is that we will start to see little spikes that might turn into outbreaks.

WATT: Through this weekend, 48 states will have begun reopening -- Colorado, South Carolina, Georgia, and Oklahoma were among the first, and their new case counts are holding steady, for now, but it is still too early to tell the full impact of opening.

FAUCI: There is a real risk that you will trigger an outbreak that you may not be able to control, which, in fact, paradoxically will set you back.

WATT: And our hard-to-comprehend death toll of over 80,000 is likely, even higher in reality.

FAUCI: I don't know exactly what percent higher, but almost certainly it's higher.

WATT: Parts of New York state reopening Friday, but New York City will take it much slower.

BILL DE BLASIO, NEW YORK MAYOR: I'm very much aligned with Dr. Fauci's concern. In the beginning of June, that will be the first chance we get to start to do something differently, but only if the indicators show us that.

WATT: Right now, new case counts in South Dakota climbing dramatically. And after clashing with the governor over COVID checkpoints on tribal land, the Oglala Sioux now in a three-day lockdown.

UNIDENTIFIED MALE: There will be absolutely no movement of anybody or anything throughout the reservation.

WATT: Still, stores in Ohio today opened doors to a brave, new world.

UNIDENTIFIED MALE: We have cleaned everything.

WATT: Major league baseball might restart spring training in June, according to "The New York Times," and an 82-game fan-less season. First pitch may be July 4th. And Disney World in Florida is now accepting reservations for July. But not even Dr. Fauci knows everything about this virus. No one does.

FAUCI: I have never made myself out to be the end all and only voice of this. I'm a scientist, a physician, and a public health official. I give advice according to the best scientific evidence. We don't know everything about this virus, and we really better be very careful.

WATT (on camera): Here in Los Angeles county, they say we will have some restrictions on us for at least another three months as they gradually reopen. Wednesday morning, they are reopening the beaches, but not for sunbathing, not for lying around. It's for exercising only. And the parking lots will stay closed. They do not want a crush.

Nick Watt, CNN, Malibu, California.

(END VIDEOTAPE)

CHURCH: The debate over when business could reopen is heating up between California and Tesla, a day after CEO Elon Musk defied the state's shelter in place rules and opened up a factory in Fremont. Local officials ordered the carmaker to cease all nonessential activities until they agreed on a plan to reopen safely. Musk has slammed the state's virus restrictions and threatened to move the company out of California.

Well, Musk isn't the only one looking to get back to business. President Trump and many other politicians have stressed the need to get the economy back up and running. Right now, futures are pointing up on Wall Street. Stocks have gone back and forth this week as concerns continue to grow over when the economy will reopen.

CNN business emerging markets editor John Defterios joins me now from Abu Dhabi. Always good to see you, John.

[04:35:00]

So, Dr. Fauci warns that opening up an economy too early will cost lives. So, how do nations strike a balance between health and economics to determine when and how to reopen?

JOHN DEFTERIOS, CNN BUSINESS EMERGING MARKETS EDITOR: Well, Rosemary, I think the best way to do it is to visualize it, almost like a balance of the scales. The balance can be met with the health of a society and reviving growth. That's what the centrists are suggesting. It's just that's getting drowned out of the debate right now. And many are suggesting at the same time, we should learn the lessons from the Spanish flu 100 years ago. It can snap back in a very large way.

Paul Krugman is the Nobel laureate economist who has suggested that you need three key pillars on which to rebuild your economy. One is having more pervasive testing. The other is tracing, the technology we see that's out there in China. And then isolation when it's needed, when those that have been sick and then need to go into isolation, not to spread the virus yet again. If you rush this process, Krugman says, we'll pay a bigger price down the road. Let's listen to him.

(BEGIN VIDEO CLIP)

PAUL KRUGMAN, NEW YORK TIMES OPINION COLUMNISTS: But we can do this. You know, this is not an impossible task. And the alternative is far worse. The alternative is that the only way you turn this into a depression of years of depressed economic activity, is precisely by failing to take the necessary action now.

(END VIDEO CLIP) DEFTERIOS: And Krugman was suggesting that they didn't take the necessary action, the Trump administration, on the front end of this. We lost six to eight weeks and we're paying a higher price as a result. And we see society starting to cocoon, if you will, Rosemary. The savings rate is extremely high in a short period of time, up to 13 percent. At the same time, we see also that society's worried about whether they're going to be able to keep their jobs. 52 percent in a recent poll are thinking that it will get worse before it gets better. So, this is not a good sign.

Now, Gary Cohn was the head of the National Economic Council under the Trump administration, again, a very centrist thinker, a former Goldman Sachs executive, but he thinks that the lockdown is too severe at this stage and that we have to move to a gradual opening to rebuild the economy, and he also thinks there's a threat to the health care sector. We have to think beyond the COVID-19 patients and the spill out for the elderly and those without a job, psychologically.

(BEGIN VIDEO CLIP)

GARY COHN, FORMER DIRECTOR, WHITE HOUSE ECONOMIC COUNCIL: Telling people to stay home 24 hours a day, seven days a week, and only leave your house to go out and purchase groceries or other necessities has other health care implications. There are a lot of things that people need in the general economy, whether it be other health care, other medical needs, that are not getting taken care of. So, we are seeing huge instances now of other diseases and other bad health care outcomes starting to spring up in the economy, in the society.

(END VIDEO CLIP)

DEFTERIOS: Making the reference there to the mental health of society at the same time. And Rosemary, you know this is the Achilles heel of the United States. They spend $3.6 trillion in health care last year before the coronavirus. That is nearly 20 percent of GDP. And we're racking up a huge debt of 120 percent of GDP that after the elections it will become a very fervorous debate here about who's going to pay the price with that, perhaps in higher taxes.

CHURCH: Yes, and I mean, a lot of countries are feeling that sort of squeeze, aren't they? We know the U.K., it's taken a big toll on their economy, hasn't it, this whole pandemic?

DEFTERIOS: It certainly has. I know you were talking about the growth figures a little bit earlier in the program, 5.8 percent in the third quarter alone. But what we're learning here -- again, the U.K. was complacent, like the United States, in tackling the virus, and they'll pay a higher price as a result. There was a leaked document picked up by "The Times" of London, that's saying that they see the gap now, the big hole from the coronavirus, this $370 billion. That's about 15 percent of GDP.

So again, the document coming out of Downing Street -- higher taxes, jiggling the makeup of the pension payments in the future. How do you handle that? And also, a pay freeze for government workers. There is no free lunch out of this, Rosemary. Right now, the concentration is reviving growth, getting people back on the job, keep them safe. But come 2021 and 2022, we will all pay a heavy price for it.

CHURCH: Yes. A lot of tough lessons learned, certainly, from leaders who moved very slowly in the initial stages. We'll all pay dearly for that, for sure. John Defterios, many thanks for you for bringing us up to date on the situation. We appreciate it.

Well the pandemic has sent the airline industry into a tailspin. Canceled flights and low passenger turnout are just some of the challenges. Airplane manufacturer Boeing has been hit with a double blow.

[04:40:00]

Canceled orders are on the rise as deliveries of new planes come to a near halt. In an appearance on NBC's "Today" show, Boeing's CEO said, even if the pandemic subsides, customer traffic may not return.

(BEGIN VIDEO CLIP)

DAVID CALHOUN, CEO, BOEING: Something will happen when September comes around. Traffic levels will not be back to 100 percent. They won't even be back to 25. Maybe by the end of the year, we approach 50. So, there will definitely be adjustments that have to be made on the part of the airlines.

(END VIDEO CLIP)

CHURCH: And airlines now have to figure out how to enforce new policies regarding face masks. The consensus among some U.S.-based airlines is passengers must wear masks in order to board. In the plane, rules will be more lenient. Flight attendants will attempt to de-escalate challenges to the rule. But ultimately, taking a mask off while in the air likely won't warrant any further action.

When the virus started to spread in the United States, Twitter was one of the first companies to send its staff home. Now the tech giant says some employees can choose to work from home forever, even when the pandemic ends. CNN's Clare Sebastian has our report.

(BEGIN VIDEOTAPE)

CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Twitter was one of the first companies to implement a work-from-home policy for all its employees back in early March, long before most of us had even understood the scale of the outbreak in the U.S. And now the company is saying that this, for some employees, could be permanent.

The company telling CNN that the last few months have shown that working from home can actually be effective. So it sees no reason to force people to come back into the office if they don't want to. Now, tech companies, of course, are well placed to be able to do this. Google and Facebook have already extended their work-from-home policies through the end of 2020. Amazon is saying that those who can work from home can continue to do so until October 2nd.

Now, clearly, this isn't just about the fact that working from home works. Companies are grappling with a new reality of how offices are going to function in a world where this virus is still spreading. They're having to invest in things like redesigns, like technology, like enhanced cleaning, even in some cases staggering shifts, a big change and particularly for Silicon Valley which for so long had prided itself on open, fun, collaborative office spaces.

Still, in Twitter's announcement, this shows us that radical shifts may be taking place in the way we work that won't be eliminated when the virus is.

Clare Sebastian, CNN, New York.

(END VIDEOTAPE)

CHURCH: Well, now to an important update in the case of Ahmaud Arbery, the African-American jogger killed in South Georgia in February. The men charged with murdering Arbery told police they had been following him because of a reported break-in at a nearby construction site. But the man who owns that site says he knew nothing about the incident before the shooting. Here's what Larry English told CNN.

(BEGIN VIDEO CLIP)

LARRY ENGLISH, OWNER OF BUILDING SITE WHERE ARBERY WAS SEEN ON FEBRUARY 23: I don't want it to be put out and misused and misinterpreted, for people to think that I had accused Mr. Arbery of stealing or robbery, because I never did.

(END VIDEO CLIP)

CHURCH: A surveillance video taken at the building site on February 23rd appears to show Arbery entering and looking around but never touching anything before walking away. A neighbor called 911 to report the incident, but Larry English says he had nothing to do with it.

Well, as the coronavirus pandemic grips the world, the U.S. Secretary of State is in Israel for talks with Prime Minister Benjamin Netanyahu. We'll go live to Jerusalem for details on Israel's annexation plans. That's next.

[04:45:00]

(COMMERCIAL BREAK)

CHURCH: Well, U.S. Secretary of State Mike Pompeo taking a break from sheltering in place, arrived in Israel just a short time ago. He stepped off the plane wearing a red, white, and blue mask, although he was not wearing one when he left the U.S. Pompeo has been meeting with Prime Minister Benjamin Netanyahu. He will also hold talks later with Mr. Netanyahu's coalition partner, Benny Gantz. Now, this comes as the Prime Minister seeks a U.S.-backed plan to annex part of the West Bank.

CNN's Oren Liebermann is following his visit from Jerusalem. He joins me now live. So, Oren, why would the U.S. Secretary of State take a trip to Israel in the middle of a pandemic? And what all was achieved at this meeting?

OREN LIEBERMANN, CNN CORRESPONDENT: Well, Rosemary, Secretary of State Mike Pompeo and his team said this visit was at the invitation of the Israeli government. And although, of course, we all know that the coronavirus pandemic, certainly the Israeli and U.S. governments. Pompeo and his team said that this was an important chance to meet face-to-face with the Israelis, which they haven't done in a while, and especially to advance and execute the foreign policy vision of the Trump administration.

In terms of the statements we heard from Secretary of State Mike Pompeo and Prime Minister Benjamin Netanyahu, there wasn't any big announcements. We know what they expected them to talk about, and that they said is at the top of their agenda, from the Trump administration's plan for Middle East peace, coronavirus, Iran. So, all of these were pretty much expected. Netanyahu says that with the national unity government that Israel is set to swear in tomorrow, there is a chance here to advance peace and security under the basis or on the basis of the Trump administration's peace plan.

Meanwhile, Secretary of State Pompeo gave short statements saying the bond between Israel and the U.S. is strong and will continue to be strong. He also took a swipe at China by saying that unlike Israel, there are countries that hide and obfuscate the information and severity of the coronavirus pandemic.

So for these two leaders, Pompeo and Netanyahu and later today, Pompeo and Gantz, it's a chance to reaffirm the bond between Israel and the U.S., between Netanyahu and President Donald Trump. And that is an opportunity that neither of these countries will ever pass up.

CHURCH: All right, Oren Liebermann joining us live with that report from Jerusalem. Appreciate it.

And you are watching CNN. We are back in just a moment.

[04:50:00]

(COMMERCIAL BREAK)

CHURCH: London celebrated the 200th anniversary of the birth of legendary nurse Florence Nightingale by projecting her image on the side of St. Thomas' Hospital. Nightingale, known as the lady with the lamp, rose to fame after traveling to treat British soldiers during the Crimean war. She famously told nurses to wash their hands, a message still so relevant today, particularly in the midst of this pandemic.

Well, millions of graduating students won't have typical commencement ceremonies this year due to the pandemic, but thanks to the world of technology, some celebrities are trying to make this year special by offering words of encouragement to 2020 seniors virtually. Our Jeanne Moos has our report.

(BEGIN VIDEOTAPE) JEANNE MOOS, CNN NATIONAL CORRESPONDENT (voice-over): Lucky me, I'll always have my blurry old graduation photos, oblivious to social distancing, tickling a fellow grad with a tassel. But now, what a hassle.

UNIDENTIFIED MALE: Class of 2020, what is up!

MOOS: A pandemic is what's up. Instead of caps tossed, and celebrations on stage -- flesh and blood grads are being replaced --

UNIDENTIFIED FEMALE: Emily Kristine Allen.

MOOS: By pictures, you barely have to get dressed for a commencement addressed.

UNIDENTIFIED MALE: I'm at home, you're at home.

MOOS: Pharrell Williams once sang --

(MUSIC)

MOOS: But now, graduates have to be happy with the video commencement. The most famous celebrity to suffer from the virus told grads at Ohio's Wright State.

TOM HANKS, ACTOR: You started in the olden times, in a world back before the great pandemic of 2020. You have finished Wright State during, well, the great reset.

[04:55:00]

MOOS: And America's doctor's during the great reset told Jesuits high school grads that now is the time to --

FAUCI: To care selflessly about one another. Please hang in there.

MOOS: Stephen Colbert hung out on a couch, delivering his message to grads at Northwestern University in Qatar.

STEPHEN COLBERT, HOST, "THE LATE SHOW WITH STEPHEN COLBERT": Living by my family's motto, which is never stand when you can sit, never sit when you can lie down.

MOOS: Instead of a gown, Ellen settled for a bath robe.

DEGENERES: We need smart people. Actually you don't have to be that smart. Just don't tell people to drink bleach.

MOOS: Invincibility juice, Alec Baldwin called it in his "SNL" address.

ALEC BALDWIN, ACTOR: I'm so honored to be your "valedictator," for today is not about me.

TREVOR NOAH, COMEDY CENTRAL, THE DAILY SHOW: UNIDENTIFIED MALE: Even without this pandemic, nobody reaches their dreams. UNIDENTIFIED MALE: Most people just end up doing their job they don't hate until they retire.

MOOS: But leave it to Oprah appearing on John Krasinski's "Some Good News" to find the literally silver lining in a dark cloud.

OPRAH WINFREY, MEDIA MOGUL: When it's really dark and dreary on the ground and then you get in the plane, and within three minutes, you shoot above the clouds and you see the sun was always there.

MOOS: Now if only we'd get up the nerve to fly again.

Jeanne Moos.

UNIDENTIFIED FEMALE: Good luck.

MOOS: CNN.

UNIDENTIFIED MALE: Good luck.

MOOS: New York.

UNIDENTIFIED MALE: Graduated!

(END VIDEOTAPE)

CHURCH: Making it special for those seniors. Thanks for your company this hour. Stay safe and healthy. I'm Rosemary Church. "EARLY START" is up next. You're watching CNN.

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