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At This Hour

New Video Shows 13-Inch Tear in California Oil Pipeline; Deal Reached to Extend Debt Ceiling Until December; Far-Right Conspiracy Network Says, AT&T Played Key Role in Our Founding. Aired 11:30-12p ET

Aired October 07, 2021 - 11:30   ET




KATE BOLDUAN, CNN AT THIS HOUR: More breaking news. Two people are now dead and schools are delayed this morning in Central Alabama after flash flooding swamped homes and streets overnight. A 4-year-old and an 18-year-old were killed in the flooding south of Huntsville.

Crews responded to at least 30 water rescue calls. Parts of the state had twice as much rain in a few hours as they would normally get for an entire month. We'll continue to follow that.

But now to that massive oil spill in Southern California. We have new video to show you that shows a 13-inch tear in the pipe that caused the environmental disaster. Through the gash, officials say, up to 144,000 gallons of crude oil spewed into the Pacific Ocean. You see it circled right there.

This morning, we are hearing from the CEO of the energy company that owns that pipeline defending their actions in the critical hours after the pipeline broke.

Joining me now us is California's lieutenant governor, Eleni Kounalakis. It's good to see you, Lieutenant Governor. Thank you for coming back.

The Coast Guard seems to be focusing right now on a cargo ship that was anchored near the pipeline before the oil spill was discovered, but there is some question of how close that ship was, how close the anchor would be the that pipeline. What do you think caused the spill?

LT. GOV. ELENI KOUNALAKIS (D-CA): Well, Kate, at this point, we're in the middle of a federally-driven investigation into the causes. The Coast Guard is involved. U.S. Fish and Wildlife Service is involved. And we're going to get to the bottom of what happened. Everyone wants to know how could this have happened again.


Oil production off of the California Coast has been steadily decreasing since its peak in the 1990s. We are very forward-leaning on combating climate change. I think for a lot of people, there is just astonishment. And, of course, it's very upsetting to see this could still happen here in California.

But the investigation is very important. It's being driven by the federal government. The state and local government are being very helpful, and everyone wants to get to the bottom of it.

BOLDUAN: Absolutely. There's the cause and then there's the response.

CNN is reporting that California authorities were notified late Friday of reports of an oil sheen at the site of a spill. That's more than 12 hours before Amplify Energy reported it to state and federal officials. But Amplify's CEO is defending its actions. Listen to this.


MARTYN WILLSHER, CEO, AMPLIFY ENERGY CORP.: There was no lag in communication. At 8:09 A.M., we communicated back to the platforms. The first call goes to our instant response commander, which is Witt O'Brien's. Then we started notifying agencies. Witt O'Brien's also notifies agencies as well. So, there was no lag in the communications from the time that we were aware that oil on water.


BOLDUAN: What do you make of this connection? Does it come down to like a technical legal definition of notify?

KOUNALAKIS: Well, look, I think this is all part of the investigation and timing is a really important part of it. It's not just when they were notified, but when they should have known that this was happening. And so everyone is honestly focused on the cleanup, focused on protecting our beaches, focused on protecting the wildlife that's impacted by this, but at the same time, this investigation is going to be robust and we're going to get to the bottom of what happened that could cause this very severe environmental damage that is unacceptable to the people of California.

BOLDUAN: And, look, Lieutenant Governor, the weather is a big factor right now. It had been working in your favor, if you will, by keeping the oil offshore to this point. But there are reports that the weather could shift today and big winds could be blowing oil onshore. What does that mean for the cleanup efforts and for the California Coastline?

KOUNALAKIS: Kate, over 100,000 gallons of crude oil has leaked off of this part of our state that is very important for ecological value, very important for tourism. This is a very serious challenge that we're up against. And, so, again, with U.S. Fish and Wildlife, with the Coast Guard, with our volunteers, there will be hundreds, if not, over a thousand volunteers out there doing the work, and, of course, professional entities doing the work of cleaning this up as quickly and efficiently as possible.

But it's the biggest oil spill that we've had in a very long time. Fortunately, technology has gotten a lot better from some of the disasters that we've had in the past but all of this really points to the fact that California has been dramatically reducing the amount of oil production off the coast, and this is why more than 70 percent of Californians want to see an end to offshore drilling.

So, this is where we are and, again, the focus is on investigation and a very rigorous cleanup, which, as you noted, could get worse if the weather changes.

BOLDUAN: And that could happen today. Fingers crossed, and we will see. Thank you, Lieutenant Governor.

Coming up, the Senate has reached a short-term deal on the debt ceiling. So, all good. A member of the president's economic team joins me next.



BOLDUAN: The Senate majority leader says they've got a deal over raising the debt ceiling and a vote could come as early as today. It is crucial for the White House as they face an agenda on hold until, well, at least then.

Joining me right now is Jared Bernstein, a member of the White House Council of Economic Advisers. Thank you for being here, Jared.


BOLDUAN: If this deal goes through on the debt ceiling, what is going to happen in December? How is this providing any certainty?

BERNSTEIN: Yes, that's a great way to tee up the question. We're certainly happy to have a little bit of breathing room here, and we're in close touch with Senator Schumer and his team. But we cannot let -- forget the important point that you underscored, which is that this simply kicks the can down the road. It gives us some breathing room, but it doesn't resolve an issue, an issue that shouldn't even be this level of a debate or a fight right now.

And the reason for that is that this is debt that was accrued by both parties. Democrats have been pushing hard to raise this debt ceiling. $8 trillion of this debt, in fact, was accrued under Trump and McConnell in the previous administration. And yet despite the fact the debt ceiling has been raised 80 times in the past 60 years, in many cases through bipartisan cooperation, while Democrats have consistently tried to get Republicans to go along, they haven't done so.


So, sure, we're glad to see this respite in terms of this Republican- driven potential default but it shouldn't have even gotten to this point.

BOLDUAN: And you're up against a wall again in two months. I mean, do you worry you're playing into a Mitch McConnell chess match here? You've been around Washington a long time. BERNSTEIN: Yes. Look, first of all, again, you're making some really important points that I want to underscore. Two months of continuing to argue about this does not resolve uncertainty. It just keeps it going for another eight weeks. And that's why Democrats have said to Republicans this is a joint responsibility.

BOLDUAN: But why take the deal?

BERNSTEIN: This is a joint responsibility. Let us hold hands and fix it together. Republicans have consistently said, no, we won't work with you, unlike the Democrats worked with the Trump folks three times to raise the debt ceiling. So then we said, Republicans, get out of the way, we'll do it ourselves. Again, no deal.

So, look, we are the grownups in the room here and we have to oversee an economy, a global economy, wherein the U.S. treasury and the faith and credit of U.S. debt is key to the foundation of global economics. And so not only do we have to be sure that social security recipients and military members get their payments but we also have to make sure that our creditors get paid.

So, we are being the grownups in the room, we're not getting a lot of cooperation from Republicans, but we're continue to try to get this behind us.

BOLDUAN: Grownups and children are going to be up against the wall in two months. I don't how it gets easier when you're facing down a government shutdown at the very same time. But maybe when it's truly, truly horrible and immediate, maybe then bipartisanship can reign supreme.

I do want to talk to you, though, about inflation just to keep kind of our theme consistent, that every time you come on, we talk about inflation, Jared. There's the technical aspects of it that we discussed. But what's behind it doesn't matter to someone who's now paying more on a lot of stuff, now going to dollar general and paying much more these days. It's happening. It's real. But where is your current greatest area of concern and how inflation is hurting individual families?

BERNSTEIN: So, the greatest areas of concern have to do with the extent to which pandemic-related supply side constraints continue to put upward pressure on prices. Now, this is occurring in some of the areas that you know like cars, for example, having a lot to do with semi-conductors, very much a function of pandemic-related supply constraints and not just here but global. So we have to do everything we can to mitigate those constraints.

Now, if you look at an issue like lumber, lumber prices were up tremendously, that's already rolled over and started coming down. There's actually some of these components within the consumer price basket that people are going out and facing that have eased up a little bit, and that's important. But we at the White House have to do something that we haven't really had to do a lot in the past, and that's pay very close attention to these supply side constraints. And that's why we have a task force designated to these tasks and are already aware. We probably don't talk about that enough. We have folks in ports who are trying to help that coordination problem improve so that we don't have maritime parking lots in Los Angeles and Long Beach.

The president, you've heard him talk about the problem of industrial concentration and some of the price issues invoked there. We're convening experts and business owners from all kinds of different sectors, including chips and trying to get them to work together. We're pushing very hard on this because we know, as you said, that at the end of the chain, it's the consumer paying more for goods. At the same time, we're trying to make sure that we have the strongest labor market with rising wages in the background to help improve people's income over this period.

BOLDUAN: So many aspects of the economy. Let's continue this discussion another day. I'd like to talk with you more about it. Thank you so much, Jared.

BERNSTEIN: Thank you, Kate.

BOLDUAN: We'll be right back.



BOLDUAN: Stunning revelations about the founding of far-right conspiracy channel One America News. Court documents reviewed by CNN showed that CNN's parent company, AT&T, played a key role in both creating and financing the network.

CNN's Brian Stelter joins me now with more on this. Brian, what more are you learning?

BRIAN STELTER, CNN CHIEF MEDIA CORRESPONDENT: That's right. Reuters first broke this story, CNN now matching it, AT&T is CNN's parent. It is striking to read about these cable and distribution deals that financed OAN. You know, what OAN lacks in original reporting and real news, they make up for with conspiracy programming, propaganda on behalf of Donald Trump and other far-right figures.

For years after buying CNN and the rest of Warner Media, AT&T was propping up a rival that basically seeks to discredit CNN and the rest of the mainstream media at any given day, on a given way. And so what we've learned in this court document, many court documents, is that OAN was encouraged to launch by AT&T and then was provided carriage fees, cable fees, essentially -- exclusively by AT&T. Other distributors, like Comcast and Charter, don't carry OAN.


So, AT&T is largely financing the channel.

Here is what AT&T says though, a corporate spokesman telling me, we've never had a financial interest in OAN's success and does not fund OAN. He says, when AT&T acquired DIRECTV, we refused to carry OAN and they sued us as a result. We have a commercial carriage agreement now, as we have with hundreds of other channels, and as OAN has done with other providers.

Of course, there are lots of channels that get carriage fees but OAN is not your average channel. It's not really a news channel. It's full of propaganda and conspiracy programming, pushing the big lie and anti-vaccination messages. That's the difference. And the question then becomes does AT&T have any standard, any line that it draws for what programming it's willing to carry even if that programming hurts the viewers?

BOLDUAN: Brian, thank you, as always, for your reporting. I really appreciate it.

And thank you all so much for being with us today. I'm Kate Bolduan. Inside Politics with John King begins after a break.