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Study: Communities Of Color Will Bear The Brunt Of Climate Change; Biden On Russia: U.S. "Ready No Matter What Happens"; Grocery Prices Climb Amid Inflation, Supply Chain Crisis; Jared Bernstein, Member, White House Council Of Economic Advisers, Discusses Inflation, Supply Chain Crisis, Labor Shortages & Economy. Aired 3-3:30p ET

Aired January 31, 2022 - 15:00   ET

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

[15:00:00]

RENE MARSH, CNN CORRESPONDENT: Now the author of this study telling CNN, "Not everyone is bearing be same burden here. As flooding patterns shift and climate changes, we're basically telling African- American communities to shoulder greater burdens again."

The cost of flooding in the United States is going to spike some 26 percent over the next 30 years. Right now, flooding costs the U.S. a whopping $32 billion. It will eventually cost $43 billion.

People with the least resources to recover from severe flooding are the very people who are going to be hammered continuously in the decades to come.

This climate crisis is also very much a social justice crisis.

And the people most affected are actually not at the root cause of climate change nor do they have the power to enact the far-reaching climate policies to address the problem.

That power is right here in Washington, D.C., where, as you know, Victor and Alisyn, the president's climate agenda remains stalled.

Another action item that this study highlights the need for is funding these communities that are going to be seeing this higher risk, certainly need to make sure they receive the funding so they can build more resilient, climate-resilient infrastructure.

Back to you guys.

VICTOR BLACKWELL, CNN HOST: Rene Marsh, thank you.

MARSH: Thank you.

ALISYN CAMEROTA, CNN HOST: It's the top of the hour on CNN NEWSROOM. I'm Alisyn Camerota.

BLACKWELL: Good to be with you. I'm Victor Blackwell.

The U.S. says the United Nations emergency meeting today showed Russia a worldwide united front against any invasion of Ukraine. The U.S. asked for the meeting. Russia and China tried to block it.

Minutes ago, from the Oval Office, the president said the U.S. is ready no matter what happens as Russia continues the military buildup along the border with Ukraine.

(BEGIN VIDEO CLIP)

JOE BIDEN, PRESIDENT OF THE UNITED STATES: We continue to urge diplomacy as the best way forward. But with Russia continuing to build up of its forces around Ukraine, we are ready no matter what happens.

(END VIDEO CLIP)

CAMEROTA: The U.S. ambassador told the U.N. Security Council that Russia in the coming days plans to bolster troops in Belarus, which borders Ukraine, to 30,000 troops.

Ukraine's representative believes Russia has amassed more than 110,000 ground forces along its border with another 18,000 maritime and aviation personnel at the ready.

CNN national security correspondent, Kylie Atwood, joins us now from the United Nations.

Kylie, the U.S. ambassador was hoping Russia would explain before the U.N. why it was building up its military along Ukraine's border. Did they? What happened?

KYLIE ATWOOD, CNN NATIONAL SECURITY CORRESPONDENT: No, not at all. Instead, Russia came out and denied there's any proof they will go forth and invade Ukraine.

Talking about the fact that this was a bogus argument by the United States, that they are carrying out any sort of buildup.

Saying that the U.S. is causing hysteria, that they are trying to encourage countries to be worried about something that is not happening.

Of course, the United States made it clear what the U.S. and its allies are seeing along that border is dangerous and urgent military buildup, in the words of the U.S. ambassador to the United Nations.

She says the consequences would be horrific if Russia did go forth with the invasion into Ukraine.

Here is her response to the Russians claiming the United States is just essentially making this up and this isn't a true problem.

(BEGIN VIDEO CLIP)

LINDA THOMAS-GREENFIELD, U.S. AMBASSADOR TO THE UNITED NATIONS: You have heard from our Russian colleagues that we're calling for this meeting to make you all feel uncomfortable.

Imagine how uncomfortable you would be if you had 100,000 troops sitting on your border.

So this is not about antics. It's not about rhetoric. It's not about U.S. and Russia. What this is about is the peace and security of one of our member states.

(END VIDEO CLIP)

ATWOOD: As you guys were saying, the ambassador also said that the United States has proved that Russia intends to increase the number of Russian troops in Belarus, along the Belarus/Ukrainian border, to 30,000 by mid-February.

Of course, February is tomorrow so that would happen over the next few weeks.

A clear indication that Russia is choosing escalation here instead of de-escalation.

And out of this meeting today, it appeared that diplomacy right now is not ripe for creating a solution to this problem.

But the ambassador to the United Nation says they hope that Russia sees that the United States isn't alone in this sentiment.

That if Russia goes forth and does invade Ukraine, this will create an issue for all of Europe, for all of the members of the United Nations, more than 130-member states -- guys?

CAMEROTA: OK, Kylie Atwood, thank you very much.

Let's bring in Susan Glasser, our CNN global affairs analyst and staff writer for the "New Yorker," and also retired Army Major General James "Spider" Marks, our CNN military analyst and head of geopolitical strategy at Academy Securities.

[15:05:05]

Susan, I'll start with you.

Did this U.N. Security Council meeting move the needle at all?

SUSAN GLASSER, CNN GLOBAL AFFAIRS ANALYST: I think it's an important step that the Biden administration took to go to the United Nations.

In some ways, it's been surprising it's taken this long. I think it's a reflection that diplomatic behind-the-scenes talks from not produced any meaningful breakthrough. So why not?

It's important to show the world that the U.S. and its partners are doing everything they can to resolve this diplomatically.

I think it fulfills the function of forcing the Russians to be on the record one way or the other. They've said again and again, and now they said it at the U.N. Security Council, that they have no intention of invading Ukraine, it's ridiculous. That may not stop them from invading Ukraine. It won't stop them. But

it makes it more and more clear that, if they do so, it's after gaslighting the world for months with this crisis that they have created.

BLACKWELL: General, a step further than denying they're going to invade, the Russian ambassador to the U.N. denied there's even 100,000 Russian troops on the border.

I wonder what you took away from what he said today considering the context of 2008 in Georgia, 2014 in Crimea, what you saw and heard today from the Russians?

MAJ. GEN. JAMES "SPIDER" MARKS, CNN MILITARY ANALYST: Clearly, the Russians have a capability. We have the intelligence. We have seen what those capabilities look like.

I'm sorry.

(CROSSTALK)

BLACKWELL: We hear you. Keep going.

CAMEROTA: Yes, we hear you.

MARKS: My apologies.

Clearly, the Russians have capabilities on the border. We've got the intelligence. We have seen the imagery. We also have sources on the ground that have validated all of that.

Also bear in mind that the Russians have presence in Ukraine supporting the separatists in eastern Ukraine.

Clearly, what's going to happen -- and it is imminent, it is inevitable -- Putin will pull the trigger.

The timing is going to be a little bit suspect. I don't think he cares about the Olympics and timing and the conflict there.

I think what's going to happen is he'll push additional forces across the border into the Donbas while everybody is looking up north at Belarus. And it's a very short distance from Belarus to the capital of Kyiv.

That I don't think is going to happen. That's a head fake.

He's going to move across the Donbas. And then he will probably go as far as Odessa and completely cut Ukraine off from the Black Sea.

And you end up with this state called Ukraine with a third of its population gone, can't economically sustain itself, can't get to the Black Sea. And then somebody cries uncle in short amount of time.

CAMEROTA: Susan, we've heard that scenario spelled out by another one of our analysts last week. Do you see the writing on the wall that way?

GLASSER: I don't want to get in the business of prognosticating what Vladmir Putin will do militarily.

I think what is so alarming and that hasn't been focused on is Ukraine is not in a position to win a military conflict with Russia.

A lot of the conversation in recent weeks has been around what's the price that Russia will pay both militarily and otherwise, economically, diplomatically, for doing so.

I think sometimes the talk of troop movements by NATO allies, by the United States, those aren't troops that will be going into Ukraine to defend Ukraine.

Weapons are being shipped to Ukraine now but no one that I've heard suggest in a meaningful way that the Ukrainian military is in a position to stop Russia from doing this.

It could be over in matter of days, a conflict like the one the general is outlining.

BLACKWELL: General, if you believe that Putin is going to pull the trigger, he is going to invade, these threats of punishing sanctions for those in Putin's inner circle, we've heard from the administration that the president will move NATO, move troops from NATO countries in the near term.

Are these consequential threats at all? Are they significant deterrents if you believe he's already made up his mind?

MARKS: I don't know he's completely made up his mind. I think he probably has.

But I'll tell you, if the sanctions are so punishing and inevitable in this particular case, those oligarchs, those are underbosses to Putin.

Those oligarchs would have gone to Putin and said, look, man, I'm all in on this particular course of action here. But if we suffer, you're going to suffer along with us.

And if that was the case, we would see a retreat from these actions that we're seeing right now.

So I'm not convinced that Putin thinks that removing Russia from the SWIFT codes, those kinds of economic sanctions that truly are, could shred the economy of Russia and his oligarchs.

[15:10:04]

I don't think they think that that is actually going to happen. If they did, he would be in retreat. He would be moving the forces away.

And he would be a hero. The sad thing here is Putin could be a hero either way could be a hero either way.

If he invades, he's a hero. He's created this vassal state, Ukraine. He'll take the heat from the global community.

But if he pulls away, he's a hero.

So we're in a very, very delicate situation.

CAMEROTA: Susan, what do you think about that? Because we have heard from other analysts that hitting the oligarchs in the pocketbooks would be an effective deterrent.

But I mean, we certainly hear to Biden administration talking about considering that enough. But it's hard to know if they are moving down that path.

GLASSER: I think the general just made a very important point, which is that, to a certain extent, Vladimir Putin has already baked that price into his decision making.

He's not deescalated. That suggests he's willing to pay what price he thinks it's going to cost.

Clearly, Nord Stream 2, the pipeline, the gas pipeline to Germany that's been an issue in recent years. Clearly, he understands that's gone.

Clearly, he understands there would be a different level of sanctions than the kind of sanctions that were levelled against him and his allies before in 2014, for example.

So he's already baked that into his calculations. And I think that's part of why you're hearing this extreme level of concern from the U.S. side right now.

Because there's a sense that it's not deterring Putin from proceeding right now. I think that's very worrisome.

BLACKWELL: All right, Susan Glasser and Major Geneal "Spider" Marks, thank you both.

MARKS: Thank you. Appreciate it.

BLACKWELL: Grocery prices keep climbing and most Americans are feeling it. Is there any relief coming? We'll ask a member of the Biden administration.

CAMEROTA: And former President Trump says the quiet part out loud. He released a statement overnight saying that Vice President Mike Pence should have overturned the 2020 election. We have much more on that.

(COMMERCIAL BREAK)

[15:16:27]

CAMEROTA: If you've gone to the grocery store lately, and who hasn't --

(LAUGHTER) (CROSSTALK)

CAMEROTA: -- you may be experiencing sticker shock.

BLACKWELL: Inflation, labor shortages because of Omicron, persistent supply chain concerns are driving up prices for food and other consumer goods.

CNN's Gabe Cohen has more on this.

(BEGIN VIDEOTAPE)

MIKE CROWDER, GROCERY SHOPPER: It's real tough.

GABE COHEN, CNN BUSINESS CORRESPONDENT (voice over): For Mike Crowder, finding affordable food has been difficult. He's battling cancer and living on a tight budget.

CROWDER: It's hard for me to get out here and work and be around people. Sometimes, you know, you just have to do without some things to eat.

COHEN: Grocery costs keep climbing, on everything from meat, to seafood, produce, cereal and much more, with overall prices up 9 percent from a year ago.

UNIDENTIFIED MALE: It feels like I'm paying a lot more at the register when I finally do check out.

COHEN: Now, big name brands are raising prices. Kraft Heinz is the latest, announcing hikes on Velveeta cheese, Oscar Mayer meats, coffee and Kool-Aid. Joining General Mills and Campbell Soup and Procter & Gamble, which is raising the price of Tide laundry products.

DOUG BAKER, VICE PRESIDENT OF INDUSTRY RELATIONS, FMI THE FOOD INDUSTRY ASSOCIATION: So, they've put it off as long as possible and now we're going to feel the effect of that for the next few months.

COHEN: The entire food supply chain is facing surging costs, congestion, and a labor shortage, which have hardly improved.

The number of cargo ships parked off the California coast hit a record high in January, with more than 100 still waiting.

Even after the ports unloaded 13 percent more containers than ever before in 2021. The cost of ingredients, packaging and transportation keeps skyrocketing.

TONY SARSAM, CEO, SPARTANNASH: The extraordinary cost pressure that we're seeing across all different businesses right now is landing in that last resort. And that's why you're seeing the inflation.

COHEN: And Omicron is adding to it, peeling workers from warehouses, processing facilities and grocery stores.

This month, U.S. pork production dropped 8 percent in just a week, with staff sick or quarantined.

With fewer employees, distributors are cutting orders to some grocery stores by 20 percent to 40 percent.

MICHAEL NEEDLER, OWNER, FRESH ENCOUNTER: It's been Whack-a-Mole. It's one item one day and then, you know, a completely different segment the next.

COHEN: And demand for groceries keeps surging with people suck at home and inflation at a 39-year high.

UNIDENTIFIED MALE: A lot of times you're limited with what you can get.

COHEN: A recent survey found 37 percent of customers are very concerned about shortages seen on items like pet food, paper goods and cream cheese.

UNIDENTIFIED FEMALE: There's just not as many things on the shelves.

COHEN: The Biden administration says they're working to ease inflation, accusing some of the largest meat processors of raising prices just to drive up profits.

But experts are projecting more grocery price hikes in the months ahead.

BETH MONCEL, CREATOR, "BUDGET BYTES" BLOG: Well, you have to be really strategic and intentional.

COHEN: Beth Moncel runs a blog about cooking on a budget.

Her advice, look for sales flyers before shopping, join store loyalty programs, and plan meals around cheap filling items like rice and beans, as well as shelf-stable ingredients, like frozen vegetables.

MONCEL: Because every time you throw food away, you're literally just throwing money in the garbage.

COHEN: Every dollar counts for families struggling to eat these costs.

CROWDER: It's going to be kind of hard. But I -- you know, I've just got to get out here and find something to do and make it work.

(END VIDEOTAPE)

COHEN: Right now, experts are urging people not to go out and panic buy groceries. They say there should be plenty of food but there may be some limited options in the months ahead.

And, again, Alisyn and Victor, those price increases are expected to continue with U.S. consumer sentiment already at its lowest level since 2011.

[15:20:03]

CAMEROTA: OK. Gabe Cohen, thank you for that reporting.

BLACKWELL: Thank you, Gabe.

Jared Bernstein joins me now to discuss. He's a member of President Biden's Council of Economic Advisers.

Good to have you back.

I don't know if you heard Gabe's story there but the prices of Oscar- Mayer meats, Maxwell House Coffee, Kool-Ad, Campbell's Soup, Tide detergent, things that tens of millions of American families buy every week, prices all going up, 9 percent of the kitchen staples over the last year.

When is there some release coming?

JARED BERNSTEIN, MEMBER, WHITE HOUSE COUNCIL OF ECONOMIC ADVISERS: This is challenge that, as you know, Victor, we're well aware of. You heard the president talking about that in your segment.

Look, I think we need to start with the diagnosis of this problem. We have a situation where very strong demand and, by that, I mean GDP growth rates that we haven't seen for 40 years. Let's not lose this backdrop.

We have the tightest labor market we have seen perhaps in generations. Unemployment fell faster last year than any year on record. Over six million jobs created.

Against that backdrop we have the supply constraints that you just talked about.

By the way, this is a global problem. Inflation is elevated in countries across the globe. That tells you it's not just a unique American problem.

But we, at the president's direction, are doing everything we can to help the very people in that story when it comes to ports, trucking, semiconductors, lowering kitchen table costs, protecting consumers, pursuing more competition.

I can go into granular detail, including the 60 percent decline in dwell time of containers at the ports.

That's the work we're trying to do to unsnarl the chains.

BLACKWELL: Jared, you lay out the problem there well over the last several months. People have learned to understand the problem.

There's a new Gallop poll out that shows 79 percent of Americans expect that inflation will continue to grow over 2022. Half of those people think it will be by a lot.

I will again ask if there's any forecast of when there's relief?

BERNSTEIN: Yes. BLACKWELL: And are those people expecting the prices to go up, are they right?

BERNSTEIN: I track every inflation forecast known to man and woman. It's just part of my job.

I can tell you, virtually every forecast has inflation growing half as fast at the end of this year than it was at the end of last year.

If you consumer price index growing at 7 percent at end of 2021, forecast for it to be growing between 2.5 to 3 percent at the end of '22.

But, Victor, these are all forecasts and forecasts can be wrong.

We're not crossing our fingers and sitting on our hands and hoping they will be right. We are working 24 and seven to get the ports working 24 and seven, to get goods from ship to shelf as fast as they ever have.

And by the way, I don't want to let this go by because you had it in your report. The many numbers that were out there.

And 13 percent increase in throughput through the ports, in goods getting through the ports, getting to the shelves.

There's actually a significant increase in the performance of that part of our chain.

The difference is there's strong demand. Where does that come from? It comes from one of the strongest economies, one of the strongest labor markets on record.

I don't think we want to lose that backdrop. Imagine if we were going through this inflation and unemployment was 9 percent instead of below 4 percent.

BLACKWELL: I hear you.

BERNSTEIN: It would be a very different story.

BLACKWELL: I hear you.

On the point of inflation, you said 7 percent at the end of last year, 3.5 by the end of this year. That's still above the 2 percent goal of where the administration wants to be and where it expects it will be.

Let's move onto housing and the cost of housing. Up 14 percent last year to an average of 1,877 a month. Up nearly 40 percent in some cities across this country. Yes, some cities saying 40 percent.

What is this administration doing to keep people in their homes as we're watching this rental assistance money run out in some places?

BERNSTEIN: Really important question. We have a robust housing agenda that I'm going to tell you, both near terms and longer term. Before I do that, I want to be very clear, the forecast I was citing, those are not White House forecasts. Those are market-based forecasts.

Inflation is expected to decelerate based, in part, on the kinds of improvements I was discussing around supply chains.

BLACKWELL: All right.

BERNSTEIN: Now, look, our administration has been trying to reallocate unused funds from the $47 billion Emergency Rental Assistance Program.

This was a key program that continues to go out there to help people facing the kind of rent pressures that you were just talking about.

Right now, we have payments working in Washington and Houston and San Diego.

The president has also talked about a $100,000 affordable home initiative over the next few years by making sure low-cost funding is available to people who finance those kinds of production.

[15:25:04]

Not just owner-occupied housing but multifamily housing as well.

BLACKWELL: Jared, we're coming up on the beginning of February. The first Friday, we get the jobs report. We know that at the beginning of January, there was the surge of Omicron. It's on the back side now in major cities.

What are you expecting? And what should people expect when we see those numbers? Should they expect job losses?

BERNSTEIN: Very important question, Victor. I appreciate you're asking it because there is a technical component of this jobs report we'll get on Friday for January.

It turns out that the peak of Omicron cases coincided with when the survey data for the payroll survey was being collected.

If you were not at work, if you were on unpaid leave, you're not counted as being on the payroll.

Because you're not paid, and it's payroll survey, you're sick, maybe caring for someone with COVID, there's millions of people like this. And if you're not at work because of the Omicron variant, you're not going to be counted in the payroll.

That's why, again, many forecasters are calling for an unusually low job rate for January. Some are forecasting a negative rate. We'll have to see.

It's not something you can forecast because it's such an unusual situation.

I think the key point, from our perspective, is the underlying strength of the economy, the underlying strength of the job market, is ongoing because, as we have seen, the caseloads are turning over.

So job loses that we may see in January, we can be certain will come back in months to come.

BLACKWELL: All right. Jared Bernstein, thanks for your time.

BERNSTEIN: Thank you.

CAMEROTA: Well, the Georgia D.A. investigating former President Trump is asking the FBI to provide security after an incendiary speech by Trump.

BLACKWELL: Plus, President Biden promised to name a black woman to the Supreme Court. It is stirring up a debate among Republicans, with one GOP Senator saying the nominee would be a beneficiary of affirmative action.

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