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Trump has Called for U.S. Schools to Fully Reopen in Fall; Russia Accused of Hacking Vaccine Developers; Imperial College Vaccine in Second Round of Human Trials; Trump Administration Increasing Anti- China Rhetoric; Small Businesses Struggle During Crisis; Real Madrid Capture Spanish League Title; FBI Investigation Hack on High-Profile Twitter Accounts. Aired 4:30-5a ET

Aired July 17, 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]

KIM BRUNHUBER, CNN ANCHOR: More than 77,000 new cases of coronavirus were confirmed in the U.S. on Thursday, the highest one-day total so far. Many hospitals are already filling up. Some places incredibly are bringing in refrigerated trucks to use as temporary morgues. The alarm is growing just weeks after most of the country had begun to reopen. To avoid another lockdown masks in public are now required in more than 3 dozen states.

Meanwhile, the Trump White House continues to lean on school districts to resume classes in the coming weeks but additional CDC safety guidelines for schools that were expected this week are now delayed and it's unclear when they'll be released. But the Centers for Disease Control and Prevention doesn't have much time left to communicate any fresh guidance to educators. New school terms in the U.S. generally begin in late summer or early autumn, just weeks away. Many medical experts say there's no way many children can return to full-time in person schooling until the pandemic is under control.

CNN's chief medical correspondent, Dr. Sanjay Gupta discuss the situation with former CDC director Thomas Frieden. The two men talked about the likely consequences of following Mr. Trump's directive.

(BEGIN VIDEOTAPE)

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: I do wonder, how do you think this will play out if President Trump has his way and school districts simply open and children go back to school regardless of what the situation is like in the area? And as you're thinking about that, I do want to show what happened in Israel as well, this graph of what happened when schools started to reopen in Israel. You see there May 17th and look at the trajectory in the days afterwards. But what happens if we just open up schools, Dr. Frieden?

THOMAS FRIEDEN, FORMER DIRECTOR, U.S. CENTERS FOR DISEASE CONTROL: Well, I can tell you with 100 percent certainty that if you open schools in communities where you have a lot of COVID spreading, you're going to have to slam them shut again.

Look at what happened in Arizona, Texas, Georgia, South Carolina, Florida. You open too soon, it's one step forward and many steps backward. We're now having this enormous reservoir of viral infections, hundreds of thousands of people, actually millions of Americans today are walking around infectious with COVID.

We've got to cool it down, and we can do this. There are some things that all of us can do with the three "W"s. Wear a mask correctly. Mask up, America. Wash your hands or use sanitizer and watch your distance. Those inside crowded spaces, that's what COVID likes. We're going to have to close bars and restaurants in most of the country or this is not going to stop. So there's something that all of us can do, and then government needs to do a better job testing. It's just impossible to have a useful program if it takes a week for a test to come back.

(END VIDEOTAPE)

BRUNHUBER: The Kremlin is denying hacking allegations leveled at Moscow. Three Western allies say Russia backpackers are trying to steal coronavirus vaccine research from institutions around the world. Dmitry Peskov, the Kremlin spokesperson, says his country has nothing to do with it.

Matthew Chance is in Moscow. So, Matthew, take us through these extraordinary hacking attempts. What do we know about who did this and also how?

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, you're right, Kim, these allegations are extraordinary. That Russia has been hacking into organizations trying to find a coronavirus vaccine. Organizations in United States, in Britain, and in Canada. That's the allegation coming from the security services of those countries.

What they say is that a hacking group which has been called among other things "cozy bear" which is linked with the Russian foreign intelligence service, the SVR, has been infiltrating various, you know, software systems, vulnerable computer systems and then use malware which it implanted on those systems to download files, possibly to upload files as well.

Now obviously, allegations like that are extremely serious, particularly at a time when everybody in the world virtually is trying desperately to find an effective treatment for coronavirus. It's provoked an angry response from the Russians. You mention what the Kremlin has said. They said they have absolutely nothing to do. There's a categorical denial. Always get a categorical denial by the way from the Kremlin when they're confronted with any allegations of Russian wrongdoing.

What the security agencies say though is that actually no coronavirus vaccine work was hampered as a result of the attacks. Nevertheless, extremely sensitive that this is taking place at this extremely sensitive time. Russia is of course one of the countries with the most to gain for getting a vaccine. It's got, you know, one of the highest numbers of people with coronavirus infections in the world. More than 750,000 people have been reported as infected. The real figure is probably much higher than that. And they plowed enormous resources of the state into trying to find a vaccine themselves. [04:35:00]

There's a bit of, I suppose, vaccine nationalism going on, Russians are very proud of the fact they've made great advances they say in trying to formulate their own vaccine. And they are rejecting, again, out of hand these allegations of spying or information from other countries could have played a part of that. One senior Russian official said that these allegations of spying are simply an attempt to tarnish the Russian vaccine which could, he said, be the first in the world -- Kim.

BRUNHUBER: Very interesting. And not the last of it, I'm sure. Thank you so much, Matthew Chance, in Moscow.

Well, we could be a step closer to a coronavirus vaccine. Imperial College London, one of the many research institutions on the hunt, is entering the second round of human trials. Nina dos Santos meets one of the participants.

(BEGIN VIDEOTAPE)

NINA DOS SANTOS, CNN CORRESPONDENT (voice-over): Justine, in her 30s, is receiving an experimental new vaccine against coronavirus.

JUSTINE ALFORD, VACCINE TRIAL VOLUNTEER: And that's it?

UNIDENTIFIED FEMALE: That's it.

DOS SANTOS: She'll get a second booster shot in two weeks' time, and if all goes to plan, should become immune.

UNIDENTIFIED FEMALE: OK, this goes under your tongue.

DOS SANTOS: She's one of around 300 volunteers who have been tested for coronavirus and deemed eligible to take part in this stage of human trials at Imperial College, London.

(on camera): Justine, how do you feel?

ALFORD: I feel really good, actually. It will definitely be something to tell the grandkids over supper one day.

DOS SANTOS: And here's why. This is what Justine has just received. It works quite differently to other vaccines. It doesn't contain a full, albeit weakened copy, of COVID-19. Instead, just a tiny piece of genetic material. The hope is that now that genetic material has found its way into one of her muscle cells, her body will be encouraged to produce antibodies, thereby conferring immunity to coronavirus.

(voice-over): The vaccine is based on a synthetic strand of self- replicating code, or RNA. It's a technique that has never yet been brought to market but one which could transform the way future vaccines are made.

DR. KATRINA POLLACK, SENIOR CLINICAL RESEARCH FELLOW, IMPERIAL COLLEGE, LONDON: That allows the vaccine to be very scalable, and that's exactly what you need when you've got a pandemic and you are talking about not just vaccinating millions but, potentially, billions of people.

DOS SANTOS (on camera): This is something of a gamble, though, isn't it? This is very, very high science.

POLLACK: That's true to say that. That makes it very exciting.

DOS SANTOS (voice-over): And part of the answer as to whether this method will work lies 250 miles north of the capital.

LUCY FOLEY, BIOLOGICS BUSINESS UNIT DIRECTOR, CPI: Look at this container here. This is a 5-liter drum. This could potentially contain up to 5 million doses in there.

DOS SANTOS (on camera): And how long will it take this production facility, when everything's up and running, to make a bottle like that?

FOLEY: So the process that we're working on developing would take two weeks to make the product and then encapsulate it so that -- so that it can go into humans.

DOS SANTOS (voice-over): Before they can do that, these scientists in Darlington are figuring out how to go from the experimental phase to a product that can be mass manufactured.

FOLEY: Imagine stirring a cup of tea with a spoon and then stirring a bucket with a spoon. You wouldn't get the same mixing effects.

DOS SANTOS (on camera): So how quickly could you scale this up?

FOLEY: If you look at more traditional vaccine, you'd be looking at around an 18-month program. For this vaccine, we're looking between four and six months to get it to scale, the manufacturing process ready.

DOS SANTOS (voice-over): The vaccine will still have to be tested on thousands more in locations where the virus is still circulating.

This is among 23 vaccines in clinical trials worldwide, and one of several using RNA. But with billions of people to protect in this pandemic, developing a vaccine in such small doses could make a big impact soon.

Nina dos Santos, CNN, London.

(END VIDEOTAPE)

BRUNHUBER: The Trump administration is increasing its anti-China rhetoric with an eye towards the November election. Tensions are already high between the rival powers over issues including the coronavirus, Hong Kong, and disputed South China Sea, and now China's responding to reports the U.S. is considering a travel ban on members of China's Communist Party.

Kristie Lu Stout joins me from Hong Kong. So the possible ban on Chinese Communist Party figures, what do we know?

KRISTIE LU STOUT, CNN CORRESPONDENT: It is an incredible revolution that was first reported by "The New York Times" saying that the Trump administration is weighing a sweeping travel ban on the 90 million plus members of the Chinese Communist Party and their family. Now I should add that CNN has reached out to the Trump White House, to the U.S. State Department, to the Department of Homeland Security for comment. We have yet to receive comment.

But we have received comment from the spokesperson of Chinese Ministry of Foreign Affairs who called the planned travel ban, quote, pathetic. Now if this ban were to go through, exactly who would be affected? It would affect the party elite in China as well as rank and file members. It would also affect businesspeople, including the tech titan, Ren Zhengfei. He is the founder of the Chinese telecom giant Huawei. It would affect the editor in chief of ByteDance. Site is the parent company of the very popular app TikTok.

[04:40:00]

It would also affect Jack Ma. Jack Ma is the billionaire founder of Alibaba. He is arguably the most well-known capitalist in China. He is also a Communist Party member. But this ban would also affect academics, scientists, and doctors. In fact, Dr. Li Wenliang, whistleblowing COVID-19 doctor who later died of the disease, he was a member of the Chinese Communist Party -- Kim.

BRUNHUBER: So I mean, so many fault lines already between the U.S. and China. Is this likely to further exacerbate that growing rift between the two countries or is it sort of being waived away internally as the U.S. domestic election politics?

STOUT: You know, it's not being waived away. That Ministry of Foreign Affairs in China held another press conference today and again, just condemning that the reports of this planned travel ban and fault lines is precisely the right word. There are many fault lines between the U.S. and China right now who have locked horns on a number of issues from autonomy for Hong Kong, human rights Xinjiang, assertions of sovereignty in the South China Sea, the fate and future of Taiwan, the tech war, the trade war, the W.H.O. and its relationship with China. The list goes on. If the Trump administration were to go through with this planned travel ban it would arguably be its toughest action yet against China and many commentators say China would most certainly retaliate -- Kim.

BRUNHUBER: All right, we'll follow this developing story. Thank you so much, Kristie Lu Stout from Hong Kong. Appreciate it.

As the pandemic wears on, small companies in the U.S. struggling to stay in business. Coming up, we'll hear from one owner who's gone from success to shut down.

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BRUNHUBER: Job security is pretty well a thing of the past for many Americans as COVID cases grow. [04:45:00]

Another 1.3 million more Americans filed for first-time unemployment benefits last week. That's down 10,000 claims from the previous week. But continued claims which count workers who have file claims for at least two straight weeks stood at 17.3 million. Insecurity is also devastating small businesses.

CNN's Phil Mattingly introduces us to a woman who's still optimistic even though she had to close her popular store selling southern biscuits.

(BEGIN VIDEOTAPE)

AYESHAH ABUELHIGA, CEO, MASON DIXIE FOODS: We sold out every day.

PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT (voice-over): When Ayeshah Abuelhiga left her corporate job to launch Mason Dixie Biscuit Co. she couldn't have dreamed of how big of a hit it was going to be.

ABUELHIGA: We had lines all the way down to the (INAUDIBLE), so probably two miles long. And then it was like as if that opening day lasted a month and a half.

MATTINGLY: A first-generation American who grew up in public housing and worked a half-dozen jobs just to get through college, the comfort food pop-up was the ultimate success story. And the accolades, the permanent brick and mortar location, and most importantly, customer loyalty followed in spades.

ABUELHIGA: It was really important for us at the time to be a part of a neighborhood and a community and not just be in downtown.

MATTINGLY: Then came the pandemic.

ABUELHIGA: The first week or two there was basically no traffic. I think we were making $100 a day. So, like, it went to nothing.

MATTINGLY: The business never returned above 50 percent of its past sales, leading to this gut-wrenching decision.

ABUELHIGA: We couldn't sustain the business anymore. We had shut it down.

MATTINGLY: Abuelhiga writing the letter now taped in the window of her restaurant -- a letter an owner of a thriving business could ever imagine putting together.

ABUELHIGA: It was the last thing I wanted to do and I avoided it at all costs. What do you say to your team members? What do you say to their families, right? What do say to customers that feel like they've been there for you the whole time?

MATTINGLY: Small businesses are a central driver of U.S. economic activity, with more than 30 million in the country representing nearly 50 percent of all U.S. jobs. But as the crisis has continued unabated, thousands of brick and mortar small businesses have taken the route of Mason Dixie Biscuit Co. and closed their doors with nearly 66,000 businesses closing their doors for good since March first, according to data from Yelp, and some researchers pegging the total number at north of 100,000.

Even more are on the precipice with 23 percent in a recent survey saying they could only survive for no more than six months in current conditions. Even some that received crucial federal Paycheck Protection Program loans are simply closing their doors altogether, like Mason Dixie Biscuits.

Yet, in a sign of the very resiliency that defines what small business owners represent, a second business run by Abuelhiga, a frozen biscuit business once driven by customer loyalty to the restaurant, itself, has taken off.

ABUELHIGA: Never in a million years could we have planned that it was going to be as crazy as it was. The demand surge for us was upwards of 200 percent month-over-month.

MATTINGLY: And Abuelhiga isn't closing the door to giving another restaurant a shot post-pandemic.

ABUELHIGA: There isn't a bone in my body that doesn't want to try this again.

MATTINGLY: But as small businesses around the country fight for survival, she strikes a chord many facing this once-in-a-century pandemic are clinging to each day.

ABUELHIGA: I can't say that you should feel like it's a failure. It's really just closure on a chapter but it forces you to think what's the next step. What's the next move?

(END VIDEOTAPE)

BRUNHUBER: Coming up, concerns about national security are being raised after some of Twitter's most influential users were hacked.

[04:50:00]

(COMMERCIAL BREAK)

BRUNHUBER: Real Madrid have captured the Spanish league title with a 2-1 win over Villarreal La Liga play Thursday. Striker Karim Benzema scored both goals for Real and with that Real Madrid legend Zinedine Zidane wins his second title with the club as manager to go along with the title he won as a player back in 2003. Real Madrid ended the two- year hold on the Spanish crown by their archrivals Barcelona. The coronavirus pandemic halted play from March 10th to June 11th. And when La Liga returned, it was without fans.

The FBI is now investigating that huge cyber-attack on the Twitter accounts of a who's who of politicians and business leaders that scammed people out of money through bitcoin payments. CNN's Brian Todd explains how it could impact national security, the

economy and the U.S. Presidential election.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice-over): Joe Biden has assured his supporters he'll never asked them to send him bitcoin, cryptocurrency for donations. That comes after Biden's verified Twitter account, and those of many other famous people, were compromised by hackers, in a devastating attack. They got to the accounts of former President Obama, Bill Gates, Elon Musk, other celebrities like Kim Kardashian- West and Kanye West and companies like Apple and Uber. And they did it, Twitter says, by doing what is called social engineering.

DONIE O'SULLIVAN, CNN BUSINESS REPORTER: What actually seemed to happen was that a Twitter employee was hacked. And that Twitter employee had sort of had access to the master controls that could control or take over a lot of these accounts.

TODD: After that infiltration, a fake tweet from Bill Gates said, I am doubling all payments sent to my bitcoin address for the next 30 minutes. You sent $1,000 I'll send you back $2,000. The other famous accounts had almost identical inducements.

The FBI is leading an investigation. Two U.S. Intelligence officials tells CNN, it is too early to tell if the attack is by a lone wolf hacker or someone working for a nation state. By cyber experts are calling this nightmarish for what could happen in the future. President Trump's Twitter account does not appear to have been targeted in this hack, but the president makes many of his announcements and dictates policy, sometimes over Twitter. What if.

[04:55:00]

LAURA ROSENBERGER, ALLIANCE FOR SECURITY DEMOCRACY: You could imagine how deeply damaging it could be if you saw a tweet from a compromised account, whether it's the president, or somebody else in a senior position, saying, you know, that we have launched some sort of attack on North Korea. And North Korea might not know whether or not that is true.

TODD: Experts say Americas enemies could send the financial markets into a spiral, by seizing a verified Twitter account and putting out false information. And the fact that Biden's account was compromised, in the midst of election season is very concerning. Because of fake tweets, the hackers could have sent from his account.

BEN BUCHANAN, AUTHOR, THE HACKER AND THE STATE: It certainly seems like they may have been able technically speaking, to have -- make him say things he never would say. Like, they could indeed be quite damaging to him.

TODD: And analysts say hackers could grabbed Twitter accounts, sent fake information and spark dangerous confusion on election day itself.

ROSENBERGER: You say had a lot of accounts that suddenly started tweeting allegations that there had been fraud or something was rigged, or that there was foreign interference. And the people couldn't trust the outcome. And you could also imagine people having, you know, significant doubts then created about the outcome of the election, even if there is none of that kind of activity that had happened.

TODD (on camera): And there's concern about how this hack might have prevented legitimate important information from getting out. Right after the discovery of the hack, Twitter had to temporarily shut down much of its network of verified Twitter accounts, including the account of the national weather service. Which then could not issue warnings on Twitter about possible tornadoes hitting the Midwest.

Brian Todd, CNN, Washington.

(END VIDEOTAPE)

BRUNHUBER: Well, thank you very much for spending your time with us here at CNN. I'm Kim Brunhuber. Please stick around, "EARLY START" is next.

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