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Malaysian Police Chief: All Passengers Cleared In Four Areas Of Flight 370 Probe; Malaysia Air Steps Up Cockpit Security; GM CEO Faces More Questions On Delayed Recall; Supreme Court Strikes Down Individual Political Donor Limits; 8.2 Magnitude Earthquake Rocks Chile

Aired April 02, 2014 - 10:00   ET

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

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CAROL COSTELLO, CNN ANCHOR: Breaking overnight, new cockpit security rules. CNN learning about strict new guidelines. Malaysia airlines issuing internal memos to its employees as investigators refocus their attention on the flight crew.

U.S. Defense Secretary, Chuck Hagel --

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CHUCK HAGEL, U.S. DEFENSE SECRETARY: We're going to go back and walk through this.

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COSTELLO: In Hawaii and talking to CNN about the search.

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HAGEL: What could have been done, maybe what should have been done. What needs to be done better?

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COSTELLO: As Australian ships race to the search zone.

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WILL RIPLEY, CNN CORRESPONDENT: We wanted to tell the story of the "Ocean Shield" as it moves out into the Indian Ocean.

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COSTELLO: A special edition of NEWSROOM starts now.

Good morning. I'm Carol Costello. Thanks so much for joining me. New this morning, a breakthrough headline, all 227 passengers on Malaysian Flight 370 have been cleared of any wrongdoing. That's according to Malaysia's police chief. So far, 170 people have been interviewed as part of their criminal investigation, and more interviews are expected. But 26 days into the search, there are still no clear suspects.

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KHALID ABU BAKAR, INSPECTOR GENERAL, ROYAL MALAYSIAN POLICE FORCE: Only the passengers have been cleared. The rest, no.

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COSTELLO: The focus of the investigation remains on those pilots and those who had access to Flight 370 before it disappeared. Our senior international correspondent, Nic Robertson, joins us now with more from Kuala Lumpur. Hi, Nic.

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Hi, Carol. We are beginning to see a real focus on the crew, on the cockpit. New security rules issued by Malaysian Airlines states now that the pilots cannot be left alone individually inside the cockpit. If one of them needs to leave the cockpit, they must be replaced by another senior crew member. That's a new guideline.

It shows that Malaysian Airlines is concerned about what happens, what the pilots do if left alone in the cockpit. We have heard that from the chief of police saying that all 227 passengers now cleared in this criminal investigation are describing it as a criminal investigation as it has been for a number of weeks. This is how he put it.

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ABU BAKAR: This is a criminal investigation. It is ongoing. We have not gone there. We are still waiting for reports from experts overseas and internally.

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ROBERTSON: So all 227 passengers cleared. We know they had been cleared previously for any connections with terrorist organizations. Now, he says they are cleared from all of them. Four areas of the investigation, from sabotage, hijacking, personal issue on the aircraft, psychological issues. It does bring the focus down. Although no one is joining the dots here, you can see it comes down on the air crew who were trained, on the captain, on the first officer, inside the cockpit here -- Carol.

COSTELLO: And yet as far as we know, nothing overtly suspicious about either man.

ROBERTSON: No. We heard the inspector general of police when he was asked, well, we heard reports, some of the reporters there questioning that. We heard reports that perhaps the captain's wife and daughter have said that the marriage was in trouble. He had psychological issues, things like this. The inspector general of the police was very clear and relaxed about it. No, he said, that's not the case. He said that things were fine. He is seemingly knocking that idea down.

But the focus for whatever is behind whatever the issues are behind the suspicion that seems to be focusing on the captain and the first officer. It doesn't seem to be at least the inspector general is knocking down the idea of some kind of psychological issue. They have a lot more information than they are telling us.

The inspector general is saying, this is going to take a very long time. I can't tell you what's going on. One day, he said, this will end up in the court of law. There will be a prosecution. He didn't say who they were going to prosecute. It was interesting. We can't prejudice that case. That is what he was saying -- Carol.

COSTELLO: Interesting. Nic Robertson reporting live from Kuala Lumpur. As Nic said Malaysia Airlines stepping up security to make sure nothing like this ever happens again. A source telling CNN, new rules have been put into place. They required no pilot or first captain is ever allowed to be alone inside the cockpit. The airline is also stepping up security measures surrounding that cockpit area.

CNN correspondent, Rene Marsh, now joins me from Washington. Rene, take us through these new rules that Malaysia has put into place.

RENE MARSH, CNN AVIATION AND GOVERNMENT REGULATIONS CORRESPONDENR: Carol, the first one you spoke about, no pilot or first officer is allowed to be alone in the cockpit. The reason behind that is, for example, if one pilot has a health issue, you always want someone who is able-bodied to be in the cockpit to be able to fly the plane or if a pilot has sinister intentions, you wouldn't want it that person in the cockpit and at the controls alone.

We can tell you here in the United States, a pilot is never alone in the cockpit. Before a pilot leaves the cockpit, they have to receive verification that it is clear for them to come out. When they do come out, we know that the door is blocked. If someone is at the cockpit door, for example, and wants to get in, the pilot must make a visual contact through that little peep hole before opening the cockpit door.

We also know that in the United States, pilots don't get served the same meal in the event, let's just say, the chicken that's being served is tainted. Each one is going to get a different meal if they are in the cockpit.

So here in the United States, Carol, the security program is pretty robust. It really has been since 9/11. We saw those hardened cockpit doors. As far as we know, they have never been breached. In addition to that, you have crew members that receive self-defense training.

And there are thousands of federal flight deck officers, which essentially are pilots that are armed. That's a voluntary program. Add that to the federal marshals that are also on board many flights -- Carol.

COSTELLO: So all of these rules went into place for American Airlines and other airlines after 9/11. The entire world was paying attention at that time. It makes you wonder why Malaysia didn't institute these rules right after 9/11 happened.

MARSH: You know, I was speaking to one pilot, former 777 pilot today. I wanted his perspective on this. I said the same thing. Although 9/11 didn't necessarily happened there in Malaysia, it still happened. So it was very much a part of the history of aviation as far as incidents go. The only way to characterize this is simply it is disappointing that at this point, now, is when these rules are being put in place. These are rules that are very helpful, make a lot of sense, but they are just happening now for Malaysia Airlines -- Carol.

COSTELLO: Rene Marsh. It is disappointing. Rene Marsh, reporting live from Washington. Thanks so much. I'll be right back.

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COSTELLO: The investigation into Flight 370 has been filled with missteps, among them, the early briefings, where it was unclear who exactly was in charge of this whole investigation. The change in what we know now were the final words from the plane, "Good night, Malaysia 370," wasn't all right, good night, and the delay in searching the Southern Indian Ocean. Joining me now is former FBI assistant director and CNN law enforcement analyst, Tom Fuentes. Welcome back, Tom.

TOM FUENTES, CNN LAW ENFORCEMENT ANALYST: Good morning, Carol.

COSTELLO: Good morning. So first of all, let's start with this. Malaysian investigators say all 270 passengers on the plane have been cleared. Are you surprised?

FUENTES: Yes, a little bit. You are talking about investigation and working different countries where all different people were from and relying on their police to do the interviews and family members and everything from those countries. So I was a little bit surprised. But at least that's what they think.

COSTELLO: They said again they are focusing their investigation on the two men in the cockpit, but as of yet, nothing overtly suspicious has turned up.

FUENTES: That's right. Nothing has turned up. Every rumor, as Nic Robertson said earlier, every rumor about the wife or children or other people saying things were false. They were not true reports in the first place. None of them have said anything negative yet to the police. You will notice in the report this morning, the inspector general of police did not clear the crew.

You do have still flight attendants and crew members that they are still looking at. They did not clear ground personnel that touched that airplane and serviced it, handled the luggage, cleaned the airplane, all the other people. Clearing the passengers is one thing. They haven't cleared anybody else.

COSTELLO: What goes into clearing someone in a possible crime like this one?

FUENTES: What we are used to here in my experience is you would be cautious about the term, clearing someone. There have been incidents where a perfectly normal person had some type of a mental attack and did something bad, either made a threat to the airplane or caused the pilots to land immediately because he told the flight attendant he had a bomb or was threatening other passengers.

We have had cases where passengers have attacked a pilot or a co-pilot with a hammer in one case killing him and then killing themselves. In those cases, there wasn't a prior episode of mental illness to make you think that person was going to do that. To clear everybody, you could say that we just have yet to find anything negative and the passengers, same thing, nothing negative. Actually, to clear them is a pretty strong term to use this early in the case.

COSTELLO: Yes, I thought so myself, but thank you for clarifying. I appreciate that. We have a graphic of the missteps that Malaysian investigators have made through this whole thing. Chaos in the early briefings, holding out hope of survival that maybe somewhere the plane landed and passengers survived. They have just said that yesterday.

Changing the final words from the pilots, that last transmission between air traffic control and the pilots. Confusion over who spoke those final words. We don't know if the pilot or the co-pilot said, good night, Malaysia 370.

And the search zone switches. They were depending on satellite information and they switched over to radar and found out it is the southern route, and not the northern route and they are searching in the southern ocean. What was the misstep?

FUENTES: I think from the beginning, the misstep has been with the Malaysian officials running this case. You have a very complex multifaceted, multi-national investigation. You have the police on one hand. You have the civil aviation authorities in Malaysia. You have the defense ministry in Malaysia and then the neighbors countries and their radars and their systems and the satellite company, which is a British company, Inmarsat.

So you know, you have many things going on at one time and it is being run by really at the top a group of individuals without the experience. What we have found in these kind of cases is that you need to train your executives in the first place how to handle a crisis, how to set up a command post and almost equally as importantly how to convey the progress in your case to the public. The media management of it.

From the beginning, when they decided they are not going to reveal information until it is confirmed, nothing is confirmed. 26 days later, there is nothing confirmed. Holding out until confirmation means no information. It creates a vacuum and an added mystery. There is already enough mystery. It created the aura of confusion. Where information is done diligently, it would not appear to the public.

When you are trying to bring in different experts, including the United States and the British and the French and Chinese and others, it adds to the need to try to coordinate something from a group of people that have not had the experience or training to do it.

COSTELLO: Tom Fuentes, thanks for your insight. As always I appreciate it.

FUENTES: You are welcome, Carol.

COSTELLO: General Motors, CEO, Mary Barra, facing a separate day in the hot seat. This time facing a Senate subcommittee trying to explain why her company waited more than a decade to recall cars it knew had been linked to deadly crashes. You will see the subcommittee coming together right now.

We'll start to meet in earnest in just a few minutes. Joining me to discuss it right now, CNN global economic analyst, Rana Foroohar. Welcome, Rana. General Motors may have known about this defect as early as 2001. Barra didn't explain how that could have happened when she testified yesterday. Why?

RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: I think she is telling the truth when she says she doesn't know. The most explosive part of yesterday's testimony was the e-mail from 2005 where an engineer basically admitted there was a problem with the ignition switch. But it could cost 90 cents a switch to fix it and $400,000 to put in a new production line. Skin crawls when you hear there is a monetization of human life like that.

But we don't know that Mary Barra, herself knew about that now, but how high up the food chain in the GM management did this decision- making process go. And I think that that's where real focus is going to be now.

COSTELLO: OK, that should be where the focus is and it is mind- boggling to me. Mary Barra has been in place for three months, right? Why not call someone who has been involved with GM longer, the old CEO, Dan Akerson, or engineers that worked on the cars?

FOROOHAR: Believe me, I couldn't agree more. I think you may get to that stage. We are just at the beginning of all of this. This is GM. Problem but this bean counting and sort of management, but numbers is something that has been within the auto industry for decades. You can look back to Robert McNamara, who was a whiz kids who ran the Vietnam War and bean counting and cutting back on quality. This is an issue that has plagued the auto industry. Mary Barra is trying to say, we are the new GM. It is going to take time regardless.

COSTELLO: OK, so regardless of anything things are looking pretty grim for General Motors right now. Millions of cars have been recalled, which could cost the company more than $1 billion to handle. Just left government ownership. Could this whole scandal break the company?

FOROOHAR: Well, if you look back at history, companies do a lot of recalls. We have to say that. What happens is, you need to do them all at once and you need to get out in front of it. If you let things go in drips and drabs and do recalls over the course of a year or two as Toyota did a couple of years ago, that's when you start to lose market share and see a more severe impact longer term for the company.

One thing that's interesting, after Mary Barra testified on the Hill yesterday, the stock price actually went up. The markets are confident in her. Now how confident they will be in GM after all the facts come out remains to be seen.

COSTELLO: All right, Mary Barra just walked into that subcommittee. They are going to swear the witnesses in and make their opening statements. Rana Foroohar, thanks for your insight. Thanks so much.

First, breaking news coming out of the U.S. Supreme Court. In a 5-4 ruling, the court struck down current limits on the total amount individual donors can make to political campaigns. This decision may have an immediate impact on November's congressional mid-term election. It is also a blow to federal election laws. Our senior legal analyst, Jeffrey Toobin, is here to explain. Hi, Jeff.

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST (via telephone: Hi.

COSTELLO: So explain this ruling and why the Supreme Court justice has decided this way.

TOOBIN: Well, this is part of a series of decisions that the Supreme Court has engaged in about the first amendment rights to give money to political campaigns. The most famous of these decisions in 2010 was the Citizens United case. This decision today expands the Citizens United decision. It says that individuals have a first amendment right to give as many different political campaigns as they want the maximum amount of money.

There used to be an overall limit of how much money you could give to individuals, to individual campaigns. Now, there are limits on how much you can give to one campaign. You can give to as many campaigns as you like.

COSTELLO: So doesn't that give wealthy donors a big advantage?

TOOBIN: Yes, that's exactly right. That's why wealthy donors were behind this case. What the Supreme Court has said is that the first amendment protects the right to give campaign contributions as a form of speech. The heart of all these decisions, like Citizens United or the McCutcheon case, which is what the name of this case is, is that giving money to a political campaign is an act of speech, which the government can regulate in only very limited circumstances.

Now obviously, a lot of people disagree. Money, they say, is not speech. Money is a lot different. Money is money, but the Supreme Court of these five justices, a 5-4 decision saying that money is speech and thus can't be regulated, at least very much.

COSTELLO: These rulings continue to surprise me, only because so many Americans are concerned about the money factor with who gets elected to public office. They think it is a real problem. These kind of rulings seem to only exacerbate those problems.

TOOBIN: Well, you know, Chief Justice John Roberts, who wrote today's opinion, you could see particularly at the beginning of the opinion addressed those concerns. He said, a lot of people are unhappy about all the money in campaigns. We have a first amendment. That trumps any other kind of law. We give freedom of speech to people that engage in hateful speech. We have to give freedom of speech to people who want to give to political campaigns.

Now, before the setting justices led by Justice Steven Briar said in effect that is all a bunch of nonsense. Speech is not money. That is not speech. This should be regulated. But, they only have four votes. That's why.

COSTELLO: So now, we know corporations are people and money is people too.

TOOBIN: Money is speech. That's the heart of this opinion. Corporations are people of Citizens United. The heart of today's opinion is that giving money to a candidate is like speech. A lot of people disagree with it. That's the law of the land.

COSTELLO: Jeffrey Toobin, thanks so much. I'll be right back.

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COSTELLO: At least five people are dead after an earthquake, a big one, struck off the coast of Chile last night. This was an 8.2 magnitude quake. It triggered landslides, knocked out power and caused extensive damage. It also set off a tsunami sending seven-foot waves crashing on to shore. It could have been a lot worse if the quake had struck on land. It would likely have been devastating.

I am joined now by seismologist, Kate Hutton. Welcome.

KATE HUTTON, SEISMOLOGIST, CALIFORNIA INSTITUTE OF TECHNOLOGY: Good morning.

COSTELLO: So an 8.2 quake, you can't get much stronger than that, right?

HUTTON: Well, actually, Chile has the record for the largest earthquake since the seismometer was invented, which is 9.5, which is quite a lot bigger than 8.2. Still, 8.2 can be a very damaging earthquake. Fortunately, in one way, it was offshore the so no one was sitting right on top of it. The other side of that is that off- shore quakes cause tsunamis. So that's a concern.

COSTELLO: What if the earthquake had struck land?

HUTTON: Well, the ground shaking would have been stronger. More buildings would have been damaged and there probably would have been more loss of life and property damage.

COSTELLO: I was stunned myself. The Chileans were pretty calm through all of this. There was no panic.

HUTTON: Well, if you look at the map behind me, you will see all the magnitude 8 plus earthquakes that have occurred in the last 140 years. They are very used to these earthquakes there and they have do a lot of drill activity and they know what to do in an earthquake and panic is not on the list.