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Vanished: What Happened to Flight 370?; AT&T Slashes Prices; Russian Troops Line Crimea's New Border; Colorado to Report Revenue for Pot Sales Tax

Aired March 10, 2014 - 10:30   ET

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

CAROL COSTELLO, CNN ANCHOR: Investigators now say an oil slick in the region is not connected to the airliner. Whatever struck that flight was so catastrophic, though neither the pilots nor the electronics issued a distress signal. Fears of terrorism have risen on word that two passengers used stolen passports to board the plane. And with no signs of wreckage investigators are desperately trying to figure out how the plane vanished and where it is now.

Joining me now, pilot and aviation attorney Daniel Rose. Welcome.

DANIEL ROSE, PILOT: Good morning.

COSTELLO: Let's talk about the so-called black box. This transmission device that's used by investigators to gather information about a flight. What are the chances that black box will be recovered in this case?

ROSE: I think they are pretty good. You know the analogous situation was Air France. And it did take a long while to do it. And really, probably, under even more difficult circumstances but eventually, they were able to be retrieved. We have a pretty good sense of, you know, at least at this point a couple of areas where the aircraft could have impacted the water. And I think over time, we're going to see, with all the resources that are in play, air, sea, below sea, that we have -- that we will eventually find out where those black boxes, even though they are actually orange, are located and will provide a lot of information for us.

COSTELLO: Yes I want to read you something from the British publication, "The Guardian". Quote, "The ongoing mystery of Malaysia Airlines Flight 370 is the fault of a bizarre quirk in our network society. Even cars have broadband connectivity now. But the modern jet airliner, perhaps our most technologically evolved mode of transport, still exists in the age of radio. The system that powers the plane is limited to pre-dialup internet connections speeds." Why is that?

ROSE: That's a very good question. I think that's going to be teed up as a series -- area of inquiry certainly in the U.S. for the future. There is really no excuse in this day and age to not have an exact location for an aircraft at a minimum. Not to -- not to mention what's going on.

There is systems that provide you know as you pointed radio information about the systems and -- and location. But there is a vast area of the world where aircraft just literally disappear off the radar screen for hours and hours. That's routine when you go across the Atlantic to Europe. People don't realize that for a long period of time, you're out of radar contact.

COSTELLO: I didn't realize that. It is pretty creepy, actually.

Last hour I spoke to the former undersecretary of the TSA about the possibility of terrorism. He said investigators are likely to ask questions about the flight even before it took off. Listen.

(BEGIN VIDEO CLIP)

JOHN MAGAW, FORMER UNDERSECRETARY, TSA: What happened while it was on the ground. How much was it secured when it was totally empty? And then who put the baggage on? Was then could the baggage could have been contaminated inside the terminal and just not picked up and put on the plane and it discharges at 35,000 or 37,000 feet by an altimeter detonator.

So there are so many things to figure in here.

(END VIDEO CLIP)

COSTELLO: You've been in the cockpit. How secure are these flights ahead of takeoff?

ROSE: Well you know it depends on what part of the world you're at and what the resources behind launching the aircraft. Once you close the cabin door and the cockpit door, that's just the last line of defense. But really what you need to do is, before that, have accountability of who is getting on that plane. And I think that's going to be another area that's ripe for re-evaluation. Certainly, in -- you know outside of the U.S., we do a pretty good job of knowing who is on our aircraft here. But again once you go abroad, all bets are off. It's a different standard. And it needs to be improved.

COSTELLO: How alarming is it to you that the pilots didn't issue a distress call to air traffic control?

ROSE: I think that's a -- that's a -- you know that remains a critical clue at this point. Because it really suggests that whatever happened obviously happened imminently right away and catastrophically in all likelihood.

You know, there is always the possibility that they were prevented from communicating a la a terrorist attack. But I think a lot of the other scenarios in flight breakup, fire, mechanical failure, decompression, a lot of these are consistent with this one bit of information that we know for certain, which is, there was no communication.

And that's very unusual if you have an environment that's a protracted event developing where the pilot can at least communicate. Because that's one of the first things a pilot would want to do, is say, hey, I've got a problem here. And I need help. That didn't happen here. COSTELLO: Daniel Rose thanks so much for your insight. I appreciate it.

ROSE: My pleasure.

COSTELLO: Still to come in the NEWSROOM, AT&T making the hearts of the customers slashing prices right when a rival raises theirs. Zain Asher is on that story. Good morning.

ZAIN ASHER, CNN'S PERSONAL FINANCE AND BUSINESS CORRESPONDENT: Hi Carol. Yes the wireless wars are heating up. I'll have more on how to cut your cell phone bill coming up after this quick break.

(COMMERCIAL BREAK)

COSTELLO: AT&T wants your business and is ready to fight for it; the wireless provider slashing prices yet again. CNN's personal finance and business correspondent Zain Asher is live to tell us how much they are slashing those prices. Good morning.

ASHER: Hi, Carol. Yes the wireless wars are to win customers, is basically intensifying. So as you mentioned AT&T cutting their prices by $15 on their two gigabyte mobile share value plan. T-Mobile actually recently raised prices. So overall, they have been cutting prices too even going so far as to offer to pay customer termination fees if they switch to T-Mobile.

So the bottom line is how do you block out the noise and how do you cut your cell phone bill? So for example a couple of tips for you, you don't have to necessarily be part of a family to join a family plan. That's a common misconception. You can be friends, you can be roommates, you can even be coworkers, as long as you belong to the same carrier.

Also this is my favorite. You can stretch your minutes using voice- over, Internet protocol. So what does that mean, that means apps like Skype, for example. So as long as you are connected to Wi-Fi, you are not necessarily withdrawing from your allotted pool of minutes.

Also you know using a pre-paid phone is not a bad idea if you don't necessarily trust yourself not to go over your minutes. And then there are the free texting apps like GroupMe, WhatsApp which is obviously in the news recently, because it was bought by Facebook -- Carol.

COSTELLO: Interesting thanks so much Zain Asher we appreciate that.

Still to come in the NEWSROOM, barbed wire, armed guards and mine fields, are just some of the things found along the new border of Crimea.

CNN's Anna Coren was there -- Anna.

ANNA COREN, CNN CORRESPONDENT: That's right, Carol. Proof that the Russians are building a new border between Crimea and Ukraine.

We'll have the full report after the break.

(COMMERCIAL BREAK)

COSTELLO: Tensions continue to mount in Ukraine where this weekend fighting broke out between pro-Russian and pro-Ukrainian activists during a rally in Crimea. And with just a few days left until a referendum over whether Crimea will rejoin Russia. CNN has an exclusive look at the new border that now separate Crimea from the rest of Ukraine.

Anna Coren is here to show us -- Anna.

COREN: Yes that's right -- Carol. As you say, less than a week before the people of Crimea vote in that referendum. And the Russian military will certainly has intensified in the last few days. We received reports that they were creating a new border separating Crimea from Ukraine. We drive up and this is what we found.

(BEGIN VIDEOTAPE)

COREN (voice over): Parked along the highway linking Crimea to Ukraine, a convoy of Russian military trucks and armored personnel carriers. We are approaching a checkpoint flying the Russian flag where troops are searching cars targeting media crews and confiscating equipment. We hide our cameras as soldiers inspect the van. One of them is spotted. It's taken and turned off.

This is now effectively part of Russia and they don't want us filming the evidence. The local soldier in charge who had sworn allegiance to Russia agreed to an interview.

"We are defending our people," he told me. "This is not about Russia but about protecting our homeland."

As we drive to the checkpoint, we see the new border that's being erected along this wind-swept plain.

Once out of view from Russian troops, we stop the car and resume filming.

(on camera): While Russia says it has no military presence on the Crimean Peninsula. Well, here is your proof. Russian troops have dug in armed personal carriers, have rolled up barbed wire, dug in fence posts and there are also signs that indicate that there are land mines in the area.

(voice over): A local resident says they aren't just signs, this is a mine field.

"One of my neighbor's dog ran in there and was blown up," he told me. "Why are the Russians laying land mines? Why are they being so aggressive?"

For those living here, the military buildup on their doorstep is alarming. "I'm frightened about the future," this grandmother tells me. "We don't want a war. We just want to work, live peacefully and feed our families."

Several miles up the road, the Ukrainian checkpoint appears. They too are digging in, setting up camp, well aware the standoff could turn bloody.

"We are warriors following the orders of the people of Ukraine," says this solider. "If they want us to defend Crimea then we will do this. "And we are willing to die." A sacrifice they are prepared to make for the sovereignty of Ukraine.

(END VIDEOTAPE)

COREN: Carol, we were very lucky, we didn't have our equipment confiscated. But that is happening in this media crackdown here on the Crimean Peninsula. They do not want us filming, certainly not that new border. But from what we could see, they are digging in and the Russians are here to stay -- Carol.

COSTELLO: Anna Coren, thanks so much.

Back here at home White House continuing efforts to find a diplomatic solution to this crisis. President Obama reaching out to several world leaders over the weekend, including a call with the French president.

White House correspondent, Michelle Kosinski joins me now. Good morning Michelle.

MICHELLE KOSINSKI, CNN WHITE HOUSE CORRESPONDENT: Hi Carol. It was a busy weekend, a working vacation for President Obama. When you look at these calls that he made since and including Friday, he has spoken to the world leaders of China, Japan, Germany, U.K., France, Italy, Latvia, Lithuania, Estonia. When you look at the readouts of these calls, what the White House puts out a sort of summary of them.

They all basically say exactly the same thing, stressing the unity and cooperation among these nations in trying to find a diplomatic solution and telling Russian president, Vladimir Putin, that he needs to do three things. Pull troops back in Crimea to their bases, let in international monitors, which have been turned away at the border for days now and participate in the formation of a contact group that would facilitate discussion between Russia and Ukraine.

So far, none of those things have happened. So these calls then emphasize that if things continue the way they have been in Crimea and Ukraine, that Russia will face continued international isolation.

For its part, Russia has also been participating in calls. The foreign minister has been talking repeatedly with our own Secretary of State, John Kerry. And Vladimir Putin has been making calls over the weekend with Germany and the U.K. What they say is that they agree basically when they put out their summary that they feel that there is a consensus there that there needs to be a diplomatic solution. The problem is though, there is still a major difference of opinion in the assessment of what is going on the ground. Western nations are basically saying looking forward at what's going to happen in Crimea, the government of Kiev needs to be involved. Ukraine is a sovereign nation. You can't just break away Crimea. Where as Russia sees the current government of Ukraine as illegitimate -- Carol.

COSTELLO: Michelle Kosinski, reporting live from the White House this morning, thanks.

Still to come in the 1NEWSROOM, The cash keeps coming into to Colorado pot shops when the government says your business is illegal and the banks turn you away, what do you do with all that cash?

(COMMERCIAL BREAK)

COSTELLO: Colorado is about to find out just how profitable legal marijuana has been for the state. This week, the state's tax department will release figures for sales taxes paid by pot dispensaries for the month of January. That number could be as high as $70 million. While the state counts its cash some pot shops are left wondering where to put all that money.

All this week, CNN is taking a look at Colorado's pot boom. And today Ana Cabrera finds out where weed dispensaries are putting all that money when they get turned away by the banks.

(BEGIN VIDEO CLIP)

ANA CABRERA, CNN CORRESPONDENT (voice over): It's a budding business, already bringing in big-time money but with few places to put it.

(on camera): How much money are you making?

UNIDENTIFIED MALE: Last month, we did about $1 million in sales.

CABRERA: A million in month.

UNIDENTIFIED MALE: A million, yes.

CABRERA (voice over): We wanted to know what happens with these pot profits. We agreed to hide this dispensary owner's identity for safety reasons.

(on camera): What do you do with all this cash?

UNIDENTIFIED MALE: Well, we are fortunate enough to have a bank. We bank with a company in (inaudible) "don't ask, don't tell" relationship.

CABRERA: So they don't know you are actually a pot shop?

UNIDENTIFIED MALE: Oh, I think they have a strong suspicion that we are especially when you have to turn in all your documentations to the bank. It says exactly what you are. With them, we can ignore it. We take great pains to help them ignore it by paying our vendors with cash and we also Febreze the money so it doesn't smell like marijuana when they get it and we use an armored car service to come pick it up and take it to the vault for us.

CABRERA: While banking is happening, the majority of dispensary owners are forced to hide their earnings elsewhere.

KRISTI KELLY, DISPENSARY OWNER: We try not to keep any amount of cash in high levels in any one location.

CABRERA (voice over): Big stashes of cash locked away in safes. Guard dogs to discourage attackers. For everyone in this federally illicit business, security is a huge concern. All dispensaries are required to have surveillance cameras eyeing every corner. And lot of dispensaries also have alarm systems and panic buttons like this. Just in case of an emergency. Then, there are dispensaries that are taking security to a whole other level.

UNIDENTIFIED MALE: My theme is I say, "You mess with the Russian, you face the repercussion."

CABRERA: 6'4", 275 pounds, Leo Pavlushkin is a former member of Russian special forces.

LEO PAVLUSHKIN, FORMER RUSSIAN SPETSNAZ: Spetsnaz, yes. Russian special forces, yes.

CABRERA: He is now a member of the Blue Line Protection Group, a private company providing armed security for dozens of dispensaries.

PAVLUSHKIN: -- who will command trying to overtake the place, will try to start shooting or hurt somebody or trying to do whatever. I mean they can be unpredictable.

CABRERA: In Denver, there had been about 150 reported burglaries of licensed marijuana facilities in the past year. Business owners say banking needs to be addressed for the sake of safety.

KELLY: I hope we don't have to see something bad happen before the federal government takes some serious action to resolve this as a problem.

CABRERA: Ana Cabrera, CNN, Denver.

(END VIDEOTAPE)

COSTELLO: We'll have more on the fight over legal marijuana tomorrow night. Dr. Sanjay Gupta hosts "WEED 2, CANNABIS MADNESS" examining the law, trying to keep pot off the streets and patients who say they need it. That's Tuesday 10:00 p.m. Eastern on CNN.

Well, the annual conservative gathering known as CPAC has come and gone. The positioning for 2016 among Republicans has just begun. Our national political reporter, Peter Hamby joins me now from Washington. So Peter, what are the next steps? PETER HAMBY, CNN NATIONAL POLITICAL REPORTER: Well, look, Carol, we saw all of these potential 2016 Republican candidates really try to stake out their space in the Republican field. Didn't learn too much new here. Rick Santorum is the unapologetic social conservative. Mike Huckabee is sort of your plain-spoken populist. Marco Rubio is your internationalist Neo-Con type. The two who were most interesting to me were Rick Perry, the Texas governor -- didn't do well in that straw poll that we see on the screen. Rand Paul won and (inaudible) fashion with the heavily libertarian crowd.

But Rick Perry gave a great speech and reminded people that he actually is a much more talented politician than the one we saw during his disastrous 2012 presidential campaign. The other who was the most intriguing to me was Chris Christie, who outperformed expectations, finished in fourth place there in that straw poll but actually gave a speech that the conservative crowd really liked and reminded the conservative audience that he opposes abortion rights, he name-dropped the Koch Brothers. He talked about beating back the unions, hit the media.

This was a robustly conservative speech. And it showed that he is absolutely not afraid to start to pivot to the right as he starts to lay ground work for a GOP nomination bid in 2016. This was language from Christie that we would definitely not have heard in 2013, last year when he was re-election in blue New Jersey. He is definitely positioning himself for 2016 -- Carol.

COSTELLO: OK. Come back to Rick Perry for just a second. He was an awful candidate -- awful. There's no other adjective that best describes it than awful. It is amazing to me that he would want to run again and think he would have a chance.

HAMBY: That's right. Well, think about this -- you're absolutely right. The stench of his terrible campaign is absolutely going to follow him. Donors are going to be suspicious of another campaign. But if you are buying stock in a presidential campaign, you want to buy low; Rick Perry is a three-term governor who has run before. Do not underestimate him, Carol.

COSTELLO: I'll try. Peter Hamby, many things.

Thank you for joining me today. I'm Carol Costello.

"@THIS HOUR" with Berman and Michaela; it starts after a break.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT (voice-over): Through all the bitter cold and blowing snow, through the misery and madness, the long running winter has brought long-awaited water. And the head of the Maryland Farm Bureau, Chuck Fry, says after some dry years, that's a big relief.

CHUCK FRY, MARYLAND FARM BUREAU: Whether it's a dairy farmer on the East Coast, whether you live in D.C. or wherever you live, your food comes from a farm and it's all hedged upon that water. FOREMAN (on camera): Winter water counts.

FRY: Absolutely counts.

FOREMAN (voice-over): As a rule, every 20 inches of snow will melt into just one inch of water and that may not seem like much. But a year ago, well over half the country was in drought conditions. Now, the dry spots are down to around 35 percent and that's mainly in the West, places like California.

BRIAN FUCHS, NATIONAL DROUGHT MITIGATION CENTER: They are not going to even get to normal by the time their wet season ends later this spring.

FOREMAN (on camera): In simple terms, it comes down to this, with enough snow and enough rain, a farm like this can more than double its output of corn and soybeans and so much else.

(voice-over): So, as Jon Sewell prepares for planting --

JON SEWELL, FARMER: I hope it does this in the summertime. Not snow but precipitation.

FOREMAN (on camera): If this keeps up --

SEWELL: If this keeps up, that would be fantastic. That's all we hope for.

FOREMAN (voice-over): High hopes amid the high waters that winter is leaving behind.

Tom Foreman, CNN, Tuscarora, Maryland.

(END VIDEOTAPE)

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