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President to Visit Michigan to Rally Support for Agenda; Japan's Parliament Meets to Confirm New Prime Minister; Whistleblower: Company Placing Profit Over Public Good Cleanup Underway after Oil Spill Hits California Coast; Explosion Kills a Number of Civilians Outside Mosque; North Korea Reopens Communications with South Korea; How Global Elite Hide Wealth in Secretive System; Exhibition at U.S. National Mall Remembers COVID Victims. Aired 12-1a ET
Aired October 04, 2021 - 00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
MICHAEL HOLMES, CNN INTERNATIONAL ANCHOR: Hello and welcome to our viewers here in the United States and all around the world. Appreciate your company. I'm Michael Holmes.
And coming up on CNN NEWSROOM, President Biden hits the road this week to promote his agenda, as Democrats grapple with what they may need to cut to get a vote.
'Tis the season to avoid COVID. The CDC has released new guidelines to keep your family healthy over the holidays.
And a Facebook whistleblower speaking out. Why she says teenage girls are victims of the company's corporate greed.
ANNOUNCER: Live from CNN Center, this is CNN NEWSROOM with Michael Holmes.
HOLMES: And we begin here in the U.S., where President Joe Biden will be headed to Michigan on Tuesday to rally support for a pair of multi- trillion-dollar bills that represent the heart of his legislative agenda.
After a week of negotiations, Mr. Biden's social and environmental policy overhaul is still in limbo. The vote on the bipartisan infrastructure deal, which was delayed twice last week. Well, that's now being pushed back to the end of the month. And progressive Democrats are insistent it will not pass until they get the even larger spending bill across the finish line, too. Have a listen.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: So if we're not looking at lumbers, what about 1.5, like what Senator Manchin --
REP. PRAMILA JAYAPAL (D-WA): Well, that is not going to happen.
UNIDENTIFIED FEMALE: Why won't it add up to that number? JAYAPAL: Because that's too small to get our priorities in. So it's
going to be somewhere, you know, between 1.5 and 3.5, and I think the White House is working on that right now.
(END VIDEO CLIP)
HOLMES: CNN's Arlette Saenz has more now on Mr. Biden's plans to push through his legislative agenda.
ARLETTE SAENZ, CNN WHITE HOUSE CORRESPONDENT: President Biden will hit the road this week to promote his economic agenda, which he is still hoping to get across the finish line.
The president will travel to Howell, Michigan, where he will promote the bipartisan infrastructure proposal and also, that more sweeping economic agenda, which would expand the social safety net in this country.
Both of those measures currently remain stalled in Congress, as -- as moderates and progressives remain at odds over the two measures.
The president is also expected to host Democrats here at the White House to get those negotiations going again.
But there has been frustration voiced by some Democrats in the party, particularly, moderates who are frustrated that bipartisan infrastructure bill did not get a vote last week. But the White House says that there needs to be some give and take in the negotiations. Take a listen.
CEDRIC RICHMOND, DIRECTOR, WHITE HOUSE OFFICE OF PUBLIC ENGAGEMENT: People will be disappointed. People will not get everything they want. That is the art of legislating. But the goal here is to get both bills. And we're going to fight until we get both bills. And that's the statement from the president. Human infrastructure is important, and physical infrastructure is important. So, we're going to do both.
SAENZ: House Speaker Nancy Pelosi has said an end-of-month deadline to hit that bipartisan infrastructure bill passed, but the White House, so far, has resisted putting a timeline for when they want to see these TWO measures passed. Instead, the president saying he's going to work like hell to ensure THAT they do But acknowledging that it could take a bit more time.
Arlette Saenz, CNN, the White House.
HOLMES: And joining me now from Los Angeles to discuss, CNN senior political analyst Ron Brownstein, also a CNN senior editor at "The Atlantic."
Good to see you, Ron.
RON BROWNSTEIN, CNN SENIOR POLITICAL ANALYST: Hi, there.
HOLMES: Let's start with the differences between Democrat progressives and moderates in the House, given that and almost total Republican opposition. Can you see Joe Biden getting a meaningful amount of his agenda through Congress?
BROWNSTEIN: Look, you you know, throughout this entire process, I believe that in the end, something will pass, probably not 3.5 trillion, but something very significant. Because it is in the interest of all Democrats to pass something, that they're all better off if something happens than if the whole thing collapses.
I think that's being called into question a little bit now, in the case of the senator for Arizona, Kyrsten Sinema, who is so aggressively positioning herself against the party in the way this is unfolding that you can imagine how it might possibly, she might decide that it is in our interests to sink the whole thing.
But on balance, it still seems that, in the end, Democrats would be better off with doing something they're not and, therefore, logic would assume they would find a way through this.
HOLMES: And while the Democrats have their internal issues, I mean, it really can't be left unsaid that there is pretty much no Republican support for the larger Build Back Better spending program, which are broadly popular with the public and which Democrats claim are largely paid for.
But what, then, is the political calculus for Republicans in opposing plans so popular with voters?
BROWNSTEIN: Well, look, first of all, this is the modern dynamic of the Senate, where the majorities are smaller and the ability of the president to get any support for the minority party is also small. And so, you are living on the edge constantly in the modern Senate.
Don't forget, in 2017, when Republicans had 51 seats in the Senate, their effort to repeal the Affordable Care Act collapsed, because three Republican senators said no, and they were unable to get any Democrats vote for it.
The Republican calculation now, I think, is pretty straightforward. Is that any Democratic legislative success, they believe, bolsters Democrats and bolsters Biden. And their goal, as it was with 2010, is to -- in 2009 and 2010, when Democrats unified control under Obama, is to prevent them from achieving much of anything, because they believe that will send an image of dysfunction to the country and help them in the 2022 election. And that's the calculation they are making.
And they're also betting that they can discredit this, not so much by arguing it program by program, but by focusing on the overall price tag. And you can see, to some extent, to a considerable extent, that's what Joe Manchin and Kyrsten Sinema, in a way, has been helping them to do so far, and Biden going on the road, I think, is an attempt to shift the focus back from the bottom-line cost to the individual programs, which as you know, are actually quite popular.
HOLMES: Yes, popular with Democrats. And I'm not the one doing the math, but the Democrats say that it's largely paid for. So the costs of it seems a little moot.
I mean, you mentioned the Republicans wanting to show dysfunction. Is it dysfunction not in passing things that the public want? Will there be any electoral fallout for not going with this? Does that give Democrats ammunition in 2022?
BROWNSTEIN: Well, you know, I think more likely, the way the Democrats can make this work in 2022 and 2024, there may be a political -- any kind of a twofer for a political problem and their budget problem, because obviously, they do have to slim it down now.
They're not going to get 3.5 trillion through the Senate, through Joe Manchin and Kyrsten Sinema. Probably, every other Senate Democrat would accept a very large number, as would almost every House Democrat. But they're going to have to slim it down.
One way they may do that is by phasing in and phasing out some of these programs to reduce the overall cost. And so, what you might be -- what you might see is Democrats taking some of the more popular elements, like the children's tax credit, universal pre-K, paid family leave.
And basically saying, putting them in place but having kind of an ending for and going to voters and saying, Look, if you want this to continue, you have to elect a Democratic Congress in 2022, you have to elect a Democratic president in 2020, for we are committed to meeting these benefits and Republicans would take them away.
I could imagine that being part of the solution, as they try to slim down this back.
HOLMES: Yes, and I know it's just sort of a third rail in the U.S., but my friends overseas ask me about this a lot. Whether it is, you know, the $3.5 trillion wish list, per progressives and the outrage over that from the right, what seems to be forgotten is that money, A, is over 10 years, and in that time, twice as much is going to be spent on the military.
The U.S. spends more on defense than the next 10 or 11 countries combined. But why is the bloated military budget not more of an issue?
BROWNSTEIN: Yes, it's a really good question. I mean, Democrats have felt that that is, you know, kind of a third rail in recent years. And in this Biden -- in this effort to fund this new spending, they're focusing almost entirely on raising taxes on top earners and corporations, rather than shifting money from defense to domestic spending.
Look, $350 billion a year in additional domestic spending is a lot of money. It's bigger than what Barack Obama or Bill Clinton were able to add, by far. And it is so big, because it's important to understand that they are
trying to do two things at once. This is often described as an expansion of the social safety net, and there are elements that are that, in terms of increased funding for healthcare subsidies and the child tax credit.
But it is also the biggest increase in public investment in America's future economic capacity that has been attempted probably since the Sputnik era, in the late Fifties and the early 1960s.
I mean, there are hundreds of billions of dollars in here for education funding, for universal pre-k, expanding community college, investment in green jobs, research and development.
So there are two goals here at once. In a more logical world, this probably wouldn't all be together, Michael, in a single bill, but because of the filibuster, they have to put it all together in one reconciliation bill. It's their only way to get around the inevitable Republican filibuster that could otherwise black what they want to do.
HOLMES: Yes, and you and I have talked many times about the filibuster and, you know, whether that's -- well, it's bad for the country if you want to get stuff done. Ron, always good to see you. Ron Brownstein.
BROWNSTEIN: Thanks for having me.
HOLMES: Now, Japan's parliament is set to confirm a new prime minister in a special session that began moments ago. Former top diplomat, Fumio Kishada [SIC] -- Kishida will take the reins of the world's third largest economy.
Kishida emerged as a winner of the hotly-contested election for leadership of the Liberal Democratic Party last week.
Let's bring in Selina Wang from Tokyo to talk more.
How differently might the new prime minister govern? I mean, he hasn't got long before he's got an election, actually.
SELINA WANG, CNN INTERNATIONAL CORRESPONDENT: Yes, that's right, Michael, and really, he was seen as the status quo pick who is largely going to be a continuation of his successors.
For instance, his cabinet is set to be heavy on allies of former prime minister, Shinzo Abe.
His first test, as you say, is going to be this general election that's coming up. He's going to be the face of the ruling liberal Liberal Democratic Party that was heavily criticized for the leadership of outgoing prime minister, Yoshihide Suga.
The public criticized him for his handling of COVID-19 and for pushing ahead with the Olympics, despite a surge in COVID-19 cases. Now Michael, while the LDP is expected to maintain its power, the risk
here is that he is not going to -- Kishida is not going to excite the voters in that the party's dominance may be weakened.
Because Kishida here was not the public's popular choice. He has struggled to shake off this image as a boring bureaucrat. He is a political veteran. He's a former foreign minister, but he was not the popular one. It was Taro Kono, the political maverick, who is really the public's favorite.
But ultimately, the ruling Liberal Democratic Party went with this leader, who is seen as both a safe and a stable choice, Michael.
HOLMES: Yes, yes, and so the main challenge that he will face, as the foreign foreign minister, he's going to be well-versed in the challenges of China's rising assertiveness in military buildup. And also, the resumption of ballistic missile tests by North Korea. What might his priority list be?
WANG: Well, Fumio Kishida campaigned on narrowing the income gap on this, quote, "new capitalism" and spending billions to boost the Japanese economy that has been hard hit by the pandemic.
And domestically, one of his key challenges will be to keep COVID-19 cases low. After multiple surges of COVID-19 infections, Japan is finally coming out of this long state of emergency, and these restrictions are slowly being lifted.
And as you say, on foreign policy, he faces a multitude of challenges. Not to mention North Korea becoming more aggressive, also with China. He's expected to continue his predecessor's policies of boosting the U.S.-Japan alliance, working with allies as a bulwark against China. A big challenge will be to balance the deep economic ties that Japan has with China, as well as increasing concerns about Asia's military's assertiveness.
Now, I spoke with the Suntory CEO, who was an economic adviser to the outgoing prime minister, Yoshihide Suga, and his big concern is just how long lasting Kishida's leadership will be. Take a listen.
(BEGIN VIDEO CLIP)
TAKESHI NINAMI, CEO, SUNTORY: There are so many complicated issues and he is not the strongest leader in the ruling party of LDP. So, I am so concerned about the revolving prime minister system.
(END VIDEO CLIP)
WANG: Yoshihide Suga was a short-lived prime minister, and Michael, important to put into perspective that before the leadership of Shinzo Abe, who was Japan's longest serving prime minister, Japan cycled through six prime ministers in just six years -- Michael.
HOLMES: Good point, yes. Selina, thanks so much. Selina Wang there in Tokyo for us. A Facebook whistleblower is speaking out publicly, accusing the
company of placing profit over public good. Frances Haugen, a former Facebook product manager, says the social media giant knows its platforms are used to spread hate, violence, and misinformation.
During an interview with "60 Minutes," the whistleblower said Facebook has tried to hide damning evidence in order to protect its profits.
CNN's Brian Stelter now with more on what Haugen is saying and Facebook's response.
BRIAN STELTER, CNN CHIEF MEDIA CORRESPONDENT: Yes, this is a big moment for Facebook and for the social networking world more broadly, as a whistleblower comes forward to call attention to what the algorithms, what these platforms are doing to our brains, to our minds, on a daily basis.
This employee's name is Frances Haugen. She's worked at Facebook as a product manager, trying to combat misinformation. And she says the longer she spent at the company, the more concerned she was about the public's failures.
She calls out the algorithm in particular and how it prioritizes profits, Facebook's profits, over public safety. Here's a part of what she said on "60 Minutes."
FRANCES HAUGEN, FACEBOOK WHISTLEBLOWER: One of the consequences of how Facebook is picking out that content today is that it is optimizing for content that gets engagement, or reaction. But its own research is showing that content that is hateful, that is divisive, that is polarizing, it's easier to inspire people to anger than it is to other emotions.
UNIDENTIFIED MALE: Misinformation, angry content --
UNIDENTIFIED MALE: -- is enticing to people, it's very enticing.
HAUGEN: Very enticing.
UNIDENTIFIED MALE: And keeps them on the platform.
HAUGEN: Yes, Facebook has realized that, if they change the algorithm to be safer, people will spend less time on the site. They'll click on less ads. They'll make less money.
STELTER: Haugen, aged 37 years old, is soon going to be a household name. She leaked to "The Wall Street Journal" anonymously, sharing documents with internal research from Facebook, showing how the company is, in some cases, well aware of the problems its platforms cause.
Then she gave that "60 Minutes" interview, and on Tuesday, she'll be testifying to the United States Senate.
The "60 Minutes" interview is a preview of what she might say. I was struck by a comment she made about Facebook's impact in the United States and around the world. She said, "The version of Facebook that exists today is tearing our societies apart and causing ethnic violence around the world."
Facebook, of course, says no platform is perfect, but it tries exceedingly hard to stamp out hate speech and misinformation. It says it has tens of thousands of staffers working to make the platforms healthy and strong.
And it says advertisers don't want to be associated with a toxic environment. So it's in Facebook's interests to clean up the property.
But, look, time and again, we have seen Facebook fall short of its own expectations, and its own goals. And Haugen said she had seen so much, she had to blow the whistle. Her lawyers have now filed complaints with the FCC, trying to get the government involved.
Back to you.
HOLMES: All right. Brian Stelter, our thanks.
Now, Facebook has responded to the "60 Minutes" report. A spokeswoman for the company says this, quote: "Every day our teams have to balance protecting the ability of billions of people to express themselves openly with the need to keep our platform a safe and positive place. We continue to make significant improvements to tackle the spread of misinformation and harmful content." She goes on, "To suggest we encourage bad content and do nothing is just not true."
Still to come here on the program, there is promising data for a new antiviral pill against COVID-19, but hear why Dr. Anthony Fauci says it is no substitute for a vaccine.
Plus, the latest on an oil spill off the coast of California. The ecological impact officials fear it can have in the area, after the break.
HOLMES: The CDC has released new COVID guidelines for the upcoming holidays here in the U.S. It says the most important thing you can do to stay safe is, yes, get vaccinated.
The agency is also encouraging people to mask up in areas with high transmission rates and consider virtual celebrations, rather than in- person gatherings.
Meanwhile, in New York City, public school employees who have not been vaccinated won't be allowed back in the door on Monday. Under the district's new policy, unvaccinated employees could be placed on unpaid leave until next September.
Some teachers are challenging the policy in court, but on Friday, they failed to convince the U.S. Supreme Court to halt enforcement while the case plays out.
Now, there is some good news on the COVID front. The U.S. seeing new cases and hospital admissions decline for the first time in months. And on Sunday, Dr. Anthony Fauci said the U.S. is turning a corner. He warned Americans against getting too complacent, saying millions will still need to get vaccinated.
CNN's Polo Sandoval, with more.
POLO SANDOVAL, CNN CORRESPONDENT: The United States may be turning a corner when it comes to its latest COVID surge, but in order to keep the hospitalization and infection numbers down, more people need to get vaccinated. That's the word from the nation's top infectious disease expert, Dr. Anthony Fauci, who's also chief medical adviser to President Biden, over the weekend, as the United States surpassed 700,000 deaths.
Dr. Anthony Fauci said still more needs to be done in terms of vaccination efforts. The latest CDC numbers showing that about 56 percent of Americans are fully protected, you know, against the virus, through a vaccine.
He also expressed some concern that, with the promise of a new COVID treatment, a new oral antiviral, many of those unvaccinated Americans may simply choose to bypass getting vaccinated. Fauci saying that is not a good idea.
(BEGIN VIDEO CLIP)
DR. ANTHONY FAUCI, DIRECTOR, NATIONAL INSTITUTE FOR ALLERGY AND INFECTIOUS DISEASES: It is never OK to get infected. You know, you heard the numbers. It decreased the risk, this pill did, of hospitalizations and death by 50 percent.
You know the way to decrease the risk by 100 percent? Don't get infected in the first place.
SANDOVAL: Merck and Ridgeback Biotherapeutics, the maker of that antiviral, says that their product can, potentially, cut the risk of COVID death and hospitalizations by nearly half. Those companies saying that they plan to could submit more emergency use authorization to the FDA, as soon as possible.
Polo Sandoval, CNN, New York.
HOLMES: We're going to take a quick break on the program. When we come back, California might have a new environmental disaster on its hands, after an oil spill near Los Angeles. What we're learn about in the investigation into that spill.
And, we're following developments in Afghanistan, where an explosion apparently has targeted senior Taliban leaders in Kabul. We'll have the latest, after the break.
HOLMES: A potential ecological disaster is unfolding off the coast of Southern California. Thousands of barrels of oil are pouring into the ocean after a leak in a pipeline discovered on Saturday.
Divers have been inspecting a stretch of pipeline spanning about 17 miles -- that's about 27 kilometers -- hoping to find the exact source of the spill. Officials now say the leak appears to have been stopped, but the threat to areas near Los Angeles, it's not over.
Here was the mayor of Huntington Beach on Sunday.
(BEGIN VIDEO CLIP)
MAYOR KIM CARR, HUNTINGTON BEACH, CALIFORNIA: In a year that was filled with incredibly challenging issues, this oil spill constitutes one of the most devastating situations that our community has dealt with in decades.
Rest assured that the team in Huntington Beach mobilized quickly, and we are proactively responding. We are doing everything in our power to protect the health and safety of our residents, our visitors, and our natural habitats.
(END VIDEO CLIP)
HOLMES: CNN's Natasha Chen is on the scene in Huntington Beach with more on the cleanup efforts.
NATASHA CHEN, CNN CORRESPONDENT: More than 1,200 gallons of oily water mixture have been recovered as of Sunday afternoon. And 3,700 feet of boom have been deployed.
But 1,200 gallons is nowhere near the potential total spill amount, of 126,000 gallons. The recovery and cleanup effort will taking quite some time.
We have watched as boats dragged the boom up and down the coast, trying to collect that oil, but so far, we've been told of one oiled ruddy duck that's receiving veterinary care, and reports of other wildlife washing up with oil on them are being investigated.
People here at Huntington Beach have also found tar balls on the bottoms of their feet and skin. And Orange County public health officials say that that could be causing some skin irritation. Health officials, on Sunday, also said they would issue an advisory, especially for people with respiratory illnesses.
A warning that the products evaporating from the oil spill could also create irritation to the eyes, nose, and throat. Potentially even vomiting or dizziness. The bottom line is people should stay away from the water and away from the shoreline.
KATRINA FOLEY, BOARD OF SUPERVISORS, ORANGE COUNTY, CALIFORNIA: I was there for a few hours today, and even in that time, I started to feel a little bit of -- my throat hurt. And -- and you can feel the vapor in the air.
I saw what I will describe as little pancake clusters of oil along the shoreline. And I've described it as something like an egg yolk. If you push it, it kind of spreads out.
And so we don't want people to distort those little clusters, so that the cleanup can be more easily maintained. The parent company responsible is Amplify Energy. Their CEO said Sunday they will do everything in their power to make this a quick recovery.
The spill happened about four and a half miles offshore, from a pipeline that connects from a processing platform to the shore. Divers were in place Sunday evening to try and investigate, at the potential source site, what might have caused the leak.
The National Transportation Safety Board also sent investigators to help figure out what occurred.
Natasha Chen, CNN, Huntington Beach, California.
HOLMES: Gunfire and several explosions rocked the Afghan capital on Sunday, in what appears to be a Taliban operation against an ISIS cell. And that came hours after a blast tore through a crowd gathered outside a mosque in Kabul. A number of civilians were killed.
CNN's Clarissa Ward has the latest from inside Afghanistan.
CLARISSA WARD, CNN INTERNATIONAL CORRESPONDENT: This is the most significant explosion that we have seen here, in Kabul, for quite some time now, certainly, since that horrific airport blast at the end of August.
We believe that it was targeting senior Taliban leadership who were attending the funeral prayers of the group's spokesperson's mother.
Now, we don't know exactly how many Taliban leaders may or may not have been killed or injured in that attack. They have been quite tightlipped about that at the scene.
Journalists who tried to gain access were pushed back ostensibly for security measures. And we also don't yet know who is, in fact, responsible.
The obvious candidate would certainly be ISIS-K. They were behind the airport bombing that I mentioned previously. But they've also claimed responsibility for a number of smaller scale attacks, particularly in the city of Jalalabad.
So the question now becomes how much of a challenge is the Taliban going to face if ISIS-k does claim responsibility and if they continue to wage an insurgency against this new foundering government?
Clarissa Ward, CNN, Kabul.
HOLMES: North Korea picks up the phone. When we come back, after more than a year of radio silence with South Korea, the North reopens a hotline between the two countries, but it comes with conditions. We'll have the latest from Paula Hancocks, live in Seoul, after the break.
HOLMES: The Chinese property giant Evergrande Group has halted trading and shares of its stock. The massive real[estate firm did not specify a reason for the stoppage. Evergrande is one of China's largest developers and one of the world's biggest businesses, by revenue.
However, it is also China's most indebted developer and disclosed financial challenges in recent weeks.
North Korea has reopened communications with South Korea after cutting ties back in 2020. South Korea's unification ministry confirms the North responded on a hotline about five hours ago. A communications link between the two countries' militaries has also now been restored.
North Korean leader, Kim Jong-un, vowed to restore the hotlines with the South during a speech last week.
CNN's Paul Hancocks joins me now from Seoul with the very latest. Obviously, good news, Paula, but what's behind the decision and what chance it's going to last?
PAULA HANCOCKS, CNN INTERNATIONAL CORRESPONDENT: Well, Michael, it has been a troubled hotline, for sure, over the recent months and even years. It is often one of the ways that Pyongyang shows its anger or its displeasure with Seoul, by cutting these hotlines.
So as you said, back in June of last year, they cut the hotlines. They also blew up the liaison office up in Kaesong in North Korea, to show their displeasure at South Korea. They cut off talks.
Now they did briefly reopen these hotlines. They reconnected them in July of this year, but that only lasted a couple of weeks, when Pyongyang then showed their displeasure at the U.S.-South Korean joint military drills and cut them once again. So, while it is positive news that they have been reinstated, I don't
think anybody is -- is going to be too overly optimistic as to how long it could last.
We did get some information from the South Korean side as to what was said by a South Korean official when they called, saying, it's been a while, and I'm glad that the communication line has been restored like this. I hope that the inter-Korean relations can develop into a new era, as the communication line has been restored.
So clearly, it's a positive development. We'll have to see if it lasts, and it does come at an interesting time, at a time when North Korea is continuing, and has been increasing, its missile launches and new weaponry testing.
We've seen, just last week, hypersonic missiles being tested, and anti-aircraft missile, and then recently, they were -- they were what North Korea calls strategic cruise missiles being tested, as well.
And what we've heard from North Korea is that they are calling on South Korea to abandon their, quote, "double standards and delusion" about, what they call, North Korea's self-defensive testing, considering South Korea is carrying out much of its testing of its own. Submarine-launched ballistic missile, for example, it has test fired recently with President Moon Jae-in, watching on.
So North Korea calling on South Korea to not have double standards and, if it does that, then potentially, there could be better relations going forward. We've even heard hints of another summit from Pyongyang.
HOLMES: Yes. It is interesting that North Korea has, you know, reopened lines of communication. But state media, you know, clearly says it's South Korea who must, quote, "repair relations and resolve issues."
Given all that, what actually happens when these lines of communication are open? Does anything get done?
HANCOCKS: Well, these lines, for example, the military hotlines, are effectively to make sure there's no miscalculation, no misinformation, and no inadvertent start of tensions.
So they have a call in the morning at 9 a.m., another call in the afternoon at 4 p.m., just to make sure that there is communication between the two Koreas. And the South Korean side said today that they also want to make sure, and said to North Korea, if there is an issue, we need continued communication between the two Koreas. And North Korea did agree to that.
So it's really just to make sure that nothing goes awry, Michael.
HOLMES: Yes, Paula, thank you, as always. Paula Hancocks there in Seoul, South Korea. Now, for our international viewers, WORLD SPORT coming up next for
you. For those of you in the U.S., I'll be back with more news after a break. You're watching CNN.
HOLMES: A huge trove of private financial documents now reveals how the rich and powerful have kept billions of dollars beyond the reach of taxes, creditors and accountability.
In a project known as the Pandora Papers, almost 12 million financial records were obtained by a team of investigative reporters from the International Consortium of Investigative Journalists, "The Washington Post" and hundreds more journalists worldwide.
They report in -- the report includes details on the offshore accounts of more than 130 people listed by Forbes as billionaires, and more than 330 politicians and public officials in more than 90 countries and territories.
Now, according to "The Washington Post" deep dive into it all, quote, the Pandora Papers allow for the most "comprehensive accounting to date of a parallel financial universe whose corrosive effects can span generations draining significant sums from government treasuries, worsening wealth disparities, and shielding the riches of those who cheat and steal while impeding authorities and victims in their efforts to find or recover hidden assets."
Now, we should note CNN has not done its own analysis of the legalities here, and using these could be perfectly legal, depending on where and how they're used.
CNN's Pamela Brown spoke about them with "Washington Post" investigative correspondent Greg Miller, one of the journalists reporting on the Pandora Papers.
PAMELA BROWN, CNN SENIOR WASHINGTON CORRESPONDENT/ANCHOR: Are these offshore accounts legal that you analyzed?
GREG MILLER, JOURNALIST: Yes. I mean, it depends. So these companies that offer shell companies and so forth, they reside in jurisdictions where they are abiding by the laws of, say, the British Virgin Islands or cypress or other places around the world.
And you're right. to point out that there's not anything necessarily illegal about that. But it does create a lot of problems. It leads to tax evasion. These off-shore systems are often exploited by criminals to hide ill-gotten gains. Corrupt politicians.
And just -- and as you put it at the top of the show, I mean, just the very, very wealthy in moving and hiding money in ways that the rest of us can't or don't tend to do. (END VIDEOTAPE)
HOLMES: Now, according to "The Washington Post," offshore financial firms that responded to the ICIJ's and "The Post's" request for comment issued statements asserting their compliance with legal mandates but declining to answer questions about their clients.
Well, if you noticed the prices of some some of your favorite products have been going up or perhaps empty store shelves when looking for everyday items.
Well, there is a global supply chain problem affecting everything from bacon to jewelry, TVs and dressers. Maybe you've heard about the shortage of microchips impacting smartphone makers and slowing down the car industry.
Ports are overwhelmed with backlogged goods, and the recent energy crisis in the U.S., U.K., and China haven't helped matters either.
The global economy is also facing a labor shortage, compounded by Brexit and the pandemic. And there are concerns this could all linger through the upcoming holiday season.
Let's bring in Ryan Patel, a board member and senior fellow at the Drucker School of Management at Clarion Graduate University.
Good to see you, Ryan. How bad is the damage that's been done to the global supply chain? We're seeing everything from cars to Christmas presents to Gatorade on shelves. What can people find themselves short of in the real world?
RYAN PATEL, SENIOR FELLOW, DRUCKER SCHOOL OF MANAGEMENT, CLARION GRADUATE UNIVERSITY: Well, especially with the consumer demand, with the holiday season coming, we're going to definitely see electronics, anything to do with semiconductors.
We kind of saw last year, if you think about it, you saw things go out of stock, specifically laptops and cell phones. But don't be surprised that you won't see some items as discounted as it was last year, because companies have to come up with that margins. And either they're going to increase the prices, or they're just not going to slash like before, because they've got to be able to do it.
And the second piece, Michael, I have to mention is really the timing of the supply chain. What many of these companies are trying to forecast, they really don't know what to forecast because they don't know how many products they're going to get out of the door. And if you can imagine, that leaves a lot of problems on what's going to be on the shelves.
HOLMES: Yes. Yes. And I guess when you look at the cause, it's really been a combination of things, hasn't it? I mean, you had the U.S. trade war with China. Then, of course, the pandemic. You know, you had that giant ship blocking the Suez Canal. And now there's even electricity issues in China.
What can turn these issues around?
PATEL: Well, the supply chain, first off, has never been nimble. But we saw it, you know, in the past last couple of years. When you think about innovation, it really needs to.
So what I think what we're going to see more is -- I hate to use the "C"-word here, but it's collaboration. Collaborating from a competitor, other countries. They all have to come together to really get to, you know, have these products in place, and really be able to go around these tariffs (ph) to get the consumers what they want.
And I think the innovation, and we're seeing automation and technology being leveraged like before. I think data analytics plays a huge part. And the supply chain industry has no choice, not to go slower, but to go faster to catch up.
HOLMES: What, then, is the lesson the supply chain issue is offering to countries, you know, wanting to protect themselves from shortages, long-term? What have countries learned about their vulnerabilities and the need to secure those supply chains?
PATEL: Be more resilient, and one word: diversity. You can't put all your eggs in one basket. And I think if we've learned anything, there needs to be a backup of a backup of a backup plan.
And also, you've got to really manage all the stakeholders, Michael. At the top of this, they still want sustainability. So they want measures. They still want to be able to do good in the environment in the sustainable chain.
So this is not just, hey, I'm trying to find a short-term solution. These countries can't just put a Band-Aid around it, but really have to focus on long-term valuation that would help the global economy.
Because at the end of the day, we're all globally interconnected. So it's really important we all succeed, because we're all in it together.
HOLMES: Yes. Yes, and they've become national security issues in some regards with some of these issues. Speaking of those issues, pressure growing on President Biden to lift the Trump tariffs on Chinese goods. Would that have a positive effect on this, or not really relevant?
PATEL: Well, if you just look at it, one, there's so many layers, Michael, with what that trade war tariffs was place on. It wasn't just about trade. There were other things in there.
But yes, you think about China's global economy, they've been at 6 percent growth GDP, and obviously, above and far ahead of the pandemic now and recovering.
You know, China will become a larger part of the trade. The question becomes for the U.S. and President Biden, how much can you hold out? Do you need the Chinese trade goods? Can you get it from somewhere else?
And I think part of that is a negotiation of other things. You specifically mentioned about security and investments, you know, foreign investments flowing back and forth. So there's a lot more to this than just trade.
But, yes, I think we're going to see both superpowers having to come to the table eventually.
HOLMES: We've got about a minute left, but I wanted to ask you in the broader economic world, when people have been buying because of stimulus money and so on, but then goods are in short supply, what's the end result? What are your concerns about inflation?
PATEL: Well, that's the result. When you saw the Fed chair come out and say, you can't really control, you know, the prices, and people are spending. So it's not like consumer demand has dropped. People are spending money. And so people are -- many banks have come out and said inflation is going to be an issue. Are interest rates going to increase next year? Is that going to cause, you know, a step back in the economy?
And I think the biggest thing is, where you see is, is there going to be an overheating process? So it's a fine balance to make sure that everything kind of hits on the right -- you know, going in the right way, the right track. However you want to mention it.
But yes, I think that's -- everyone is focused on the inflation rate, the finance rate, in the financial world, for sure.
HOLMES: Right. And I was going to say, it's always great to see you, Ryan Patel. Thanks.
PATEL: Thanks, Michael.
HOLMES: Now, what originally started as an art exhibition remembering more than 267,000 Americans who died from COVID-19, has become something much more. In "America Remember" is a project that overtook the National Mall in Washington, consisting of more than 700,000 white flags, each representing a person who lost their battle with the virus. The artist says that this has taken on a life of its own. CNN's Dana Bash reports.
DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT/ANCHOR: It's hard to capture this on camera. It's even hard to capture it with your eyes.
SUZANNE FIRSTENBERG, ARTIST: Yes.
BASH: When you're here like you and I are. Because it's so vast. It goes down to the World War II memorial now.
(voice-over): Suzanne Firstenberg is the artist behind in America Remember, a temporary exhibition on the National Mall. Each flag represents an American life lost to COVID-19. FIRSTENBERG: When I bought flags in June, I bought 630,000. I thought
never would we use that many. I've reordered twice.
BASH: Visitors come by, not just to observe, but to participate. Volunteers write dedications for loved ones submitted online.
FIRSTENBERG: One flag, it was a 99-year-old who died. And the flag reads, "He refused a ventilator. He asked that it be used for someone younger."
BASH: When the exhibit opened September 17, there were 670,032 deaths. Since then, thousands more have died. Each day, she's increased the number to reflect that.
FIRSTENBERG: So I check the numbers every day. Because it's important that we honor those people whom we just lost the day before.
BASH (on camera): It's a lot of people.
FIRSTENBERG: It's an incredible amount of people.
BASH (voice-over): This weekend, that number hit an unthinkable milestone: 700,000 American lives lost to COVID-19.
FIRSTENBERG: There are a lot of flags that say, "If only you would have listened." Or "I wish you'd gotten vaccinated."
BASH (on camera): Look at this one here: "Dear mom, you were a woman of strength, love, and kindness that radiated from you. This period around the holidays is the hardest without you."
FIRSTENBERG: What I didn't realize was just how much emotion people would bring to this. I created the art. But they've brought the content, the stories. The sadness. Oftentimes they'll tell me, this is the first time I've had a chance to cry.
HOLMES: Dana Bash there.
Now, Spanish officials are warning a volcano in the Canary Islands is now erupting even more aggressively than before. Look at this. These are live pictures coming to us now.
This is the volcano on La Palma. It's been gushing lava for weeks now. And the Canary Islands president says, quote, it doesn't look like it's close to ending yet, due to the millions of cubic meters of lava spilling out.
Just absolutely spectacular live pictures there, but the damage has been enormous.
Thanks for spending part of your day with me. I'm Michael Holmes. Follow me on Twitter and Instagram, @HolmesCNN. Stick around. I'll be back with more news in a moment.