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Senate Republicans Split With White House Over Funding For Testing; COVID-19 Cases Surge In California; Trump Administration Preparing To Send Federal Agents To Chicago. Aired 9:30-10a ET

Aired July 21, 2020 - 09:30   ET



JIM SCIUTTO, CNN ANCHOR: State leaders attempted to take advantage, it appears, of the COVID crisis to deliberately suppress the vote. I mean, you saw in Wisconsin, forcing people to vote in midst of the crisis. But in a city like Louisville, for instance, where there was only one polling station or Atlanta, many colleagues of mine had to wait in line five, six hours to vote

The concern was, was that state leaders were deliberately limiting access to the vote in heavily democratic areas. And I wonder as you look at this, are you concern that even if states were to get the money from Congress, that they would attempt to block access to the vote, or limit access to the vote?

MADELEINE ALBRIGHT, FORMER SECRETARY OF STATE: Well, I obviously am concerned since we've seen this before. But I think that drawing attention to the kinds of things, exactly the kind of things you have said, should put people on watch, on guard here. And that there has to be constant reporting of the kinds of things that are going on, and making very clear that we are concerned about these kinds of potential suppressions, and that one has to work with the state authorities in order to make sure that this does not happen.

And, you know, I think we -- democracy and -- I mean, voting is a privilege and a responsibility in a democracy. And we have to make sure that, in fact, there are easier ways to make it happen. I've just been reading as some companies are talking about making sure that people will have time off to go and vote. And that there is kind of a pressure from all sources of various groups in the United States to make sure that we don't see the kind of voter suppression that you're talking about.


ALBRIGHT: And there are organizations that are working very hard on this. Bipartisan in a way, yes.

SCIUTTO: Let's hope so. Let's hope so. Secretary Albright, always good to have you on and we wish you the best of luck through all of this.

ALBRIGHT: Thank you so much. Take care. You too.


POPPY HARLOW, CNN ANCHOR: All right. Well instead of Congress trying to get our pre-pandemic economy back, AOL cofounder Steve Case said let's come up with something much more equitable. He's going to be here next.



HARLOW: All right, welcome back. Treasury Secretary Steven Mnuchin is on Capitol Hill today for the stimulus talks, this as some Senate Republicans are splitting with the White House on how this funding should be allocated. Well, my next guest has some advice for all of them. AOL cofounder and chairman of the Case Foundation, Steve Case writes in a New Washington Post op-ed, "There's no going back to the pre-pandemic US economy. Too much has changed, too many new needs exist. There is a rare opportunity to break with the past and create a better future and Congress should grab it."

Steve Case joins me now, it's nice to have you. Thanks, Steve.

STEVE CASE, CHAIRMAN & CEO, REVOLUTION: It's great to be with you.

HARLOW: All right. So make the case, right, why take the next tranche of taxpayer money and focus a lot of it on start-ups, many of them unproven, instead of the same old let's fund and help struggling existing businesses?

CASE: Well, funding the existing businesses, propping them up, supporting them is important. That's what the first phase of the relief efforts with the PPP and other programs did. And I'm not saying that's not important, but if you look at where jobs are created it's not from existing businesses. It's from new businesses, young businesses, startups.

And so, if we want to build an economy for the future, we want to create jobs in communities all across the country, we can't just focus on what's already there. We have to focus on what's coming next. Back the companies of the future, the industry of the future. So that's why there needs to be focus on the phase four legislation on the role start-ups play in driving job growth, driving economic growth.

HARLOW: And you point to legislation that's already been proposed. And Amy Klobuchar, for example, back in March, a proposal for the private sector and the public sector do this together. But I'm just going to point to something that I think some critics of this might say how do you avoid a whole bunch cilindras (ph), right? How do you avoid a bunch of government-backed failed entities?

CASE: Well, I don't believe the government should be directly investing in companies trying to pick winners and losers. I think that the markets move too quickly and the government has a lot of challenges to do that. But the government can and has historically, including creating things like the internet, backing early companies through different program such as Tesla, has put money in the hands of the banks that can make lending decisions to young companies. And also help regional venture capital firms. That's what Senator Amy Klobuchar's legislation does, gets more capital in the hands of those venture capitals.

That's important because if you look at the data last year, 75% of venture capital dollars, which sort of the jet fuel that fuels the innovation of economy and start-up, 75% went to these three states, California, New York, Massachusetts. The other 47 states get just 25%. The big state, Michigan, Ohio, Pennsylvania, Wisconsin, less than 1%. Florida, third largest state, only 1.3%.

So these states, it's harder for the entrepreneurs in those places to start there, and spill there, and create jobs there, so often they leave, there's a brain drain. They go to places like Silicon Valley, because it's not an innovation economy in their own backyard. So we need to get the venture capital in there, in their backyard, so those companies can start there and those jobs can be created there, and we can have a more inclusive innovation economy, now just a few people in few places like Silicon Valley doing really well. And a lot people in a lot of parts of the country feeling kind of left behind losing their jobs, not seeing new jobs created.

HARLOW: A hundred percent, I'm going to forgive you for not mentioning the great city of Minnesota. That aside, you see --

CASE: All right, that's also 1%. Sorry about that.

HARLOW: You've been -- that's OK. You've been on the road. I mean, you've literally gone on bus tours multiple times across the country, seeing this first hand. You know, Revolution, your fund focuses on the rise of the rest and underserved communities on this front.


But is Congress listening? I mean, you've got Mnuchin on the Hill today, and this thing is going to happen and it's happen quickly.

CASE: I hope so.

HARLOW: And I just wonder if you're hearing from Republicans or Democrats, are they going to do any of this?

CASE: There's discussion, which is great, and obviously part of the reason I wrote the op-ed is, because this week is important to try to put a little bit more pressure on the issues, a little more focus on start-ups. The reason I'm optimistic is, eight years ago, I worked with then President Obama and Eric Cantor when he's the majority leader, on the JOBS Act, starting our business Start-Ups Act. And that created new rules around start-ups in the internet and raising money through crowd funding, a new cast to go public.

And that was done in a very bipartisan way. When you think about jobs, innovation and entrepreneurship, it tends to be a nonpartisan issue. So I think this is one area, obviously a lot of things in Washington today that, you know, become a hyper-partisan, there's not a lot of things Republicans and Democrats agree on, creating the jobs of the future, the industries of the future, creating jobs all across the country not just in a few places, being more inclusive.

Last year less than 10% venture capital went to women, even though it's half of our country. Less than 1% went to the black founders even though they work around 13% of the population. We level a playing field and create more opportunity for more people and really get everybody, everywhere, a shot at the American Dream, and that's a bipartisan issue.

So hopefully, they will make it a focus and integrate some of these start-up centric ideas into the next face of legislation.

HARLOW: Especially in a pandemic. I mean, they have called this the she session, right, that women are being -- going to be hit more through this than men. We're hit more, right, remember, during the great recession, and now many women are getting hit more.

Goldman Sachs had some interesting data out in the last week. And it shows that only 7% of black owned businesses right now are going to be able, small businesses, maintain their payroll if they don't get another tranche of government funding, if they don't get additional aid.

You write in your piece, lawmakers should step in to address the unintended inequalities of opportunity for female and minority entrepreneurs caused by the earlier relief bills. What are you saying Congress has the power to do so that the new equity that is pushed in which ever way it is, is more equitable? What do they have the power to do?

CASE: Well, there's a number of things they can do, but the broader point is really important. There's a lot of talk about how we get through COVID, how we get through recovery and how we get back to normal.

I don't think we want to get back to normal. Normal didn't work for a lot of people, and we didn't have a particularly inclusive approach innovation or different type of approach to capital.

HARLOW: Well, it worked for you and a lot of white guys.

CASE: It worked for me and a number of others like me. But white guys in places like Silicon Valley, done awesome. Most people in most parts of the country have been struggling. They have been feeling this innovation economy is kind of moving forward in ways that are hurting their jobs, hurting their communities because there aren't being start-ups there creating the jobs for them for the future. So that's the broader.

So we can't just get back to normal. We have to create a new normal. In terms of the things they can do, the existing PPP program already has some capital, has them allocated. That can be directed toward diverse entrepreneurs. There also thing with the Main Street Lending Program can be modified. Right now, it requires companies to be profitable to get the loan.

Obviously, start-ups general are not profitable. They're investigating to grow and create jobs, so modifying that. There's a number of things that can be done as well, you know, I mentioned Senator Klobuchar's act that really would move forward with more venture capital going to regional venture funds, so we really can kind of spread of the capital, spread the love and slow the brain drain of people leaving parts of the country because there's not much going there, having to go to the coast.

We need to create an opportunity so they can stay where they want them to be, you know, start families and start businesses wherever they want to be. And post-COVID, that's a big opportunity. We have seen people move around and sheltering in different parts of the country.

Some might want to stay there, but we need to make sure that the capital is there to help them as they pursue the path of starting and scaling the business. Which is, as I've said in the very beginning, the only way to create jobs, if we want to create jobs in the country, we want to create jobs in your community, we've got to be backing these little companies, these new companies that are provide some of that seed capital, some of which will, you know, these companies who end up being the next Amazon, being the next, you know, Google, being the next Walmart. Walmart started in a little town of Bentonville, Arkansas.

HARLOW: We all know Bentonville. We all know Bentonville. Steve, thank you very much.

CASE: Well, we need to be more inclusive. Thanks, Poppy.

HARLOW: Amen to that. Thanks for putting us out there. I hope folks in Washington that make those decisions are listening. We appreciate your time this morning.

CASE: Thank you.

SCIUTTO: Well, California was the first state to order residents to stay at home. Then the virus came back. What happened?



SCIUTTO: Welcome back. As California fights to stop another spike in coronavirus cases, the governor says barber shops and hair salons in 33 counties could be allowed to reopen again but if they conduct business outside, innovation.

HARLOW: Right. California was the first state to have a stay-at-home order, but still has seen a huge spike in cases after reopening. Our National Correspondent Sara Sidner joins us with a look at what happened in California.

I'm so glad you did this, Sara, because I keep asking the question every day. Like, how did this happen? They were so ahead of the curve before?

SARA SIDNER, CNN NATIONAL CORRESPONDENT: Yes, it's true. And I think the answer is very simple with experts saying we all know what we're supposed to do. The rules have been set, and it appears that both governments got lax and so did people.



UNIDENTIFIED MALE: When you're sleeping, you're on your belly? OK, good.

SIDNER (voice-over): The staff at this California hospital is nearing exhaustion.


SIDNER: In a video diary from inside Eisenhower Health in Rancho Mirage, Nurse Katherine Davis says, she's used to seeing one death a year in her unit. With 700 COVID patients treated here so far, she's now seen 40 deaths.

DAVIS: We would ensure that a patient did not die alone, so, you know, we would take turns spending time with them and holding their hand and talking to them.

SIDNER: Doctors knew they had the beds to treat the surge but not the staff.

DR. ANIL PERUMBETI, PULMONOLOGIST: When we heard that the next, you know, wave of relief might come in in two weeks, three weeks, four weeks, you know, that's when things become a little bit desperate.

SIDNER: They asked the federal government for help, and it arrived, an air force medical team of about 20 helped shoulder the unending load. The stress here repeated all over California.

So how did we get here? The state was the first to announce a stay-at- home order. That was March 19th.

GOV. GAVIN NEWSOM (D), CALIFORNIA: This is a moment we need to make tough decisions.

SIDNER: Seven weeks later, the governor reopened the state on May 8th.

NEWSOM: You have bent the curve.

SIDNER: But that wasn't to be. By early June, the seven day average for new daily coronavirus cases was more than 2,600. And by July 11th, it peeked at more than 9,400, more than a 250% increase.

Anne Rimoin, you are a renowned epidemiologist, what went wrong in California?

ANNE RIMOIN, UCLA EPIDEMIOLOGIST: You know, we opened up too soon. We didn't have the virus totally under control.

SIDNER: Experts agree. Residents and local governments got a complacent.

UNIDENTIFIED MALE: I want to be back out on the field now.

SIDNER: Case in point, three suburban counties near LA all lifted their mask requirements under heavy pressure from angry residents.

UNIDENTIFIED FEMALE: None of this is based on science but rather a nefarious political agenda to silence the people and strip freedoms from hard-working Americans.

SIDNER: Now, hard-working Americans in all three counties are seeing a COVID surge, and hospital beds are filling up.

DAVIS: And that's frightening because where do we go from there?

SIDNER: Are patients telling you how they might have gotten it?

DAVIS: Yes. Well, some of them are partiers. Some of them have gone out and gone to parties, no masks.

SIDNER: But Los Angeles County did and still does have strict mask requirements, tickets are even being issued if you don't comply and yet it's still the epicenter of the California surge.

JAKE TAPPER, CNN ANCHOR: How much worse does it have to get in Los Angeles before you feel compelled to issue another stay-at-home order?

MAYOR ERIC GARCETTI (D), LOS ANGELES, CA: Well, I think we're on the brink of that.

RIMOIN: People are not following the rules. They are not wearing masks, they are not social distancing.

SIDNER: Among them, California's 40 and under who make up more than half of the state's new cases. Also hard hit, the Latino community which makes up a third of the state's population but more than half of COVID infections.

DAVIS: Sometimes it's mom and dad's work experience that has brought them into contact with it, and then it goes through the whole family.

SIDNER: Experts say fixing all this comes only one way.

RIMOIN: You have to just shutdown for now. I think that that is our only way out.


SIDNER: And that is the kind of news that nobody wants to hear. Everyone wants to get back to normal. We've got the problem with schools not opening. You have the issue of businesses not being able to open.

But Dr. Perumbeti, who you heard from there, and Nurse Davis both said that they are seeing a troubling trend, they are seeing more commonly patients in their 20s and 30s so sick. It's hard for them to even turn over in bed or take a sip of water. They are saying this is not just a disease that hurts the elderly, they are seeing this in young people.

And they are telling people to please, if you don't do it for yourself, do it for your family, do it for your community, do it for the healthcare workers. Wear a mask and self-distance, and let's get through this thing. Poppy.

SCIUTTO: Sara Sidner, great to have you on the story.

Well, President Trump is preparing to send federal agents into another major US city over the objection of local and state officials, why?



HARLOW: Well, the Trump administration is planning to send federal agents to Chicago, sources tell CNN, as violence surges in that city.

SCIUTTO: CNN's Omar Jimenez is live in Chicago. City leaders there, they are echoing concerns from those in Portland, say the presence of federal agents will only make things worse, a whole host of questions too about under what authority, not having name tags, et cetera. Omar, what are we learning? Do we expect this to happen?

OMAR JIMENEZ, CNN CORRESPONDENT: That's right, Jim and Poppy. At least one law enforcement official is telling CNN that there are plans to send federal agents to Chicago through the end of the summer, specifically to focus on illegal gun sales, gun violence and outstanding warrants. And it has been an extremely violent summer here in Chicago with shootings and murder up close to 50% compared to this time last year.

But even still, Chicago Mayor Lori Lightfoot is wary of this method of help, so to speak, even given just most recently the interactions between federal agents and protesters in Portland. And even just in conversations I've personal had with the mayor, she said there's a laundry list of items that the President could do to help with the violence that we've seen, including on the health care side of things. But she says, this latest method is not it.

Now specifically, she tweeted Mr. President or not, I don't care one bit what your name is. I will not allow troops in Chicago, and I will do everything in my power to stop you. And it's not just Lightfoot. She's among mayors of places like Seattle, Portland and other places across the country who are also deeply concerned and object to the deployment of federal agents in their cities, Jim and Poppy.

HARLOW: The question becomes what power do they have to stop it? Thanks, Omar. We'll be watching very closely what happens in Chicago.