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Russia Warns of Unpredictable Consequences If U.S. Continues Weapons Shipments to Ukraine; Mortgage Rates Hit 5 Percent For First Time in Over a Decade; Ukraine Says, At Least Two People Killed in Strikes on Mykolaiv. Aired 10:30-11a ET

Aired April 15, 2022 - 10:30   ET

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

[10:30:03]

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Now, they also won't say exactly what's on this shipment, but what we do already know is that they are prioritizing the weapons that Ukraine needs more for the long-range fight in the Donbas. And so that's the 155 Howitzers, the helicopters, the air defense radars, the counter-battery radars. Everything goes in first that is of the most dire need for Ukraine's forces because the Russians are already moving that kind of capability into the Northern Donbas.

There's good indication. Watch what happens with the artillery, because that will be critical, and watch happens with the helicopters. We have reporting that we have shown that the Russians are already moving their helicopter support elements into the Northern Donbas. So, the Ukrainians are going to want helicopters there as well. They will be key to moving forces around the battlefield very quickly and the artillery will consider this. In this package we're told, there are 40,000 artillery shells, pieces of artillery ammunition included and that is all going in, they say, as fast as they can get it there.

JIM SCIUTTO, CNN NEWSROOM: They are gearing up for a large formation ground war in the eastern part of the country. It's going to be just devastating to watch. Barbara Starr at the Pentagon, thanks so much.

STARR: Sure.

SCIUTTO: Well, Russia is now warning of, quote, unpredictable consequences if the U.S. does not stop sending arms to Ukrainian forces. CNN has confirmed that Russia sent a diplomatic note known as a demarche to the State Department this week formally protesting U.S. weapons shipments. This comes as sources say the U.S. secretary of state, Antony Blinken, is cautioning that Russia's war in Ukraine could drag through the end of this year.

BIANNA GOLODRYGA, CNN NEWSROOM: Joining us now to discuss is Susan Glasser, CNN Global Affairs Analyst and Staff Writer for The New Yorker, and CNN International Diplomatic Editor Nic Robertson. Welcome both of you.

Nic, let me start with you, because on the one hand, you could read this warning as just yet another threat coming from the Russian side, but you could also interpret it as fear, as far as what they see, as more advanced weaponry coming in from NATO allies and the United States.

I'm just curious to get your assessment as someone who's watched the Kremlin for so long as to what happens next. How seriously should we be taking these threats coming from top Kremlin officials, throwing out words like nuclear weapons and given that we've already seen Putin cross the Rubicon, we didn't expect him to, by going into Ukraine the way he did?

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Yes. Russia survives on the use of threat and then following it up with the use force. You have to take the words the Kremlin says publicly seriously. And they have ratcheted up what we've heard officials say to putting it in a demarche. This is an official communique. This makes it in the Russian mind.

Remember how legalistic Putin was about getting into the war with Ukraine, wanting to sort of have all the sort of legalistic part of it, however barbaric the campaign and breaking -- creating war crimes that has happened, he still wanted a legalistic way to get into the war. So, this is -- you've got to think about it in that context. You cannot ignore the threats.

What Russia lacks so far is inability, dynamic targeting. I've heard that from NATO officials. That is it's hard for them to attack these weapon shipments on the move. They're more likely to be at a target than when they get into place at the end, or as Jim said, these big ticket items often come on trains, tanks, howitzers will often travel by train.

We've seen Russia ramp up its attacks on train stations recently, killing civilians along the way. They were using cluster munitions. That tells you they are trying to sort deny as much sort of infrastructure around the station as possible.

So, Russia knows the weak points and it definitely doesn't want to see these military hardware systems get to the frontline. It knows it lost the sort of military initiative, the rapid ground advance that it wanted to have at the beginning, the shock and awe tactics, if you will, a blitzkrieg around Kyiv, they lost it there. They don't want to lose the momentum around Donbas.

But that's what they're headed into, a stagnating trench-type warfare. They need to keep momentum, and, therefore, they need a weak enemy. And so, yes, we should expect them to go as far as they think they need each step to target and make the enemy weaker. SCIUTTO: Well, enemy not weak enough, right, given that we see this week that it's -- perhaps its most prized possession in the navy sunk by that same entity. And it just shows their ability to strike at some of Russia's most advanced systems.

Susan Glasser, I want to see how this expands, this already expanded, frankly, beyond Ukraine. As you see, Sweden and Finland consider NATO membership but also a build-up of forces on the NATO side of the border of the alliance with Russia, and Russia saying they're going to be sending more conventional forces to their side of the border.

[10:35:04]

Are we going to see sort of resurrection of the pre-1991 cold war Europe that we thought was behind us?

SUSAN GLASSER, CNN GLOBAL AFFAIRS ANALYST: You know, what's so striking is that we're actually going to see a situation that potentially is even more confrontational than the pre-1991 cold war year, in a sense that both Sweden and Finland never did join NATO during the cold war. In fact, that's what I find so remarkable about the reordering of European security that Vladimir Putin's decision to launch this war has provoked. Even World War II, even the cold war did not prompt Sweden to abandon its neutrality, and yet, its threats by Putin have done so.

So, I think it's even more threatening, certainly than the late cold war period. There's also been the unraveling of arms control agreements. There's really not a framework for dealing with Moscow right now in a way that's very, very scary. So, that's number one.

And then the other point is just, Putin's willingness to escalate and to keep going, I think, is something that people have not fully reckoned with. He is likely prepared for a long-term conflict here.

GOLODRYGA: Well, listen, he continues to get the green light from Russians at home for the large part.

I mean, Nic Robertson, if you watch Russian state media, as so many of us do, their rhetoric continues to be hardened, saying, don't stop at Donbas, go all the way, really using genocidal type of rhetoric to support, right, and justify some of the brutality we're seeing on the ground. He continues to get the support at home. I mean, this would be laughable if we weren't talking about a nuclear power but Russia just officially announced that Putin earned $122,000 last year and owns 828-square foot apartment. This is what Russians are buying at home. How long is this going to last?

ROBERTSON: If he keeps getting ships like the Moskva sunk, he is going to find it hard to cover that sort of thing up and the main T.V. broadcast, 60-minute very propaganda-oriented state T.V. broadcast last night, it was 27 minutes into the show before the Moskva was mentioned and even then, only contributing to a fire that then ultimately got a hold of the ammunitions store that ultimately sank the ship in heavy seas and the Russian government saying that everyone -- all hands were safe, everyone survived, which seems highly unlikely.

So, he cannot sustain, it would see, heavy obvious losses like that. He can continue to spin the lies and propaganda and his ability to sort of take the Russians with him. The idea that some commentators are saying, we need reeducation camps for Ukrainians, that this is going to take a long time, 20 or 30 years. This is so reminiscent of Europe's World War II history. It's horrifying.

But as we know, and this is a lesson of history, men do, people do come up who are willing to do and commit horrible deeds, populations are swept up and follow them along and this is where we are.

SCIUTTO: And some are undeterrable. History teaches us that lesson as well. Susan Glasser, Nic Robertson, thanks so much to both of you.

Still ahead, at home, a new hurdle for home buyers, mortgage rates rising to the highest level in over a decade after years and years after really historically low interest rates. What does that mean for you, coming up.

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[10:40:00]

GOLODRYGA: Prospective home buyers are already feeling the impact of inflation. In the face of high demand, low supply and rising property taxes, well, now, mortgage rates are also going up. The 30-year fixed rate mortgage average 5 percent this week. That's the highest it's been since 2010 and double what it was just six months ago.

CNN's Matt Egan is with me live here. And, Matt, this isn't just impacting homeowners but renters as well.

MATT EGAN, CNN BUSINESS REPORTER: Yes. Bianna, that's right. If you're in the market for a new rental unit, brace yourself. The median rent in the U.S. hit a record, just above $1,800 in March. That's up 17 percent from a year ago, according to realtor.com. And rent is skyrocketing, much more in some of the hottest housing markets. We have a map showing where some of these markets are. Miami, over the last two years, rent is up 58 percent, Riverside, California, 48 percent. We're seeing 30 percent-plus in Vegas, New Orleans, Richmond, Phoenix has been another hot one.

Now, the problem is that vacancy rates are at record lows. And at the same time, demand is strong. And demand is even stronger because some would-be home buyers have been priced out of that hot housing market, and so all of this is adding to really high inflation.

Now, as we know, the Fed is trying to cool off inflation by raising interest rates, perhaps rapidly, but that is setting off these shockwaves in the housing market. We've seen the mortgage rate, as we mentioned, hit 5 percent for the first time in a dozen years. The speed that has gotten there has just been pretty incredible, as you see on the chart, and that's a big deal because housing is the most inter-sensitive part of the entire economy. Let me show you in practical terms what that actually means. Say you want to buy a home for $350,000 with 20 percent, down, your monthly payment is around $300 higher today than it would have been a year ago all because the cost of borrowing has gone up. And at some point, that's got to slow down these monster price gains that we've seen in the market, because unless you're an all cash buyer, it's going to be hard to swallow these prices.

[10:45:05]

GOLODRYGA: Well, hopefully, that can balance out. But is there any sense as to when we'd see a peak here?

EGAN: We don't know. And I think part of the issue is that the supply of homes is so small and we know the demand is really high, part of that set off by COVID. And so it's going to take time for all of this to balance out. But this is just such a tangible way to see how the Feds fight to cool inflation off is really playing out in the economy.

GOLODRYGA: Yes, homeowners are really feeling it. Matt Egan, thank you, have a great weekend.

EGAN: Thank you.

GOLODRYGA: Jim?

SCIUTTO: Well, you may have noticed this. Some airlines slashing their summer flight schedules despite the heavy demand for travel because they just don't have enough staff.

CNN's Pete Muntean has been following this and has the details.

(BEGIN VIDEOTAPE)

PETE MUNTEAN, CNN AVIATION CORRESPONDENT (voice over): It is the latest challenge to your next trip. Understaffed airlines and overworked flight crews causing carriers to cancel flights. After hundreds of cancelations last weekend, jetBlue announced it is cutting 8 percent to 10 percent of its summer schedule citing a challenging staffing situation. The latest numbers show that airlines are still shy more than 30,000 workers compared to before the pandemic.

HENRY HARTEVELDT, ATMOSPHERE RESEARCH GROUP: There was a lot of burnout, and especially among some work groups, I'm hearing from folks saying, I just can't take it anymore.

MUNTEAN: Crew shortages are hitting airlines large and small. Alaska Airlines is canceling 2 percent of its flights through June. Delta pilots say they are being pushed to the limit on a regular basis.

EVAN BAACH, AIR LINE PILOTS ASSOCIATION: Longer days with shorter nights at home, shorter layovers and our pilots are tired and fatigue.

MUNTEAN: Pilot reports of fatigue spiked at Southwest Airlines last month. Their union says the company is struggling to retain its newest hires. CASEY MURRAY, CAPTAIN, SOUTHWEST AIRLINES: This is going to be a critical issue every month and every year that we move forward.

MUNTEAN: Health comes in the form of sky-high hiring reforms. Delta wants to hire 200 new pilots each month. JetBlue has already hired 3,000 new crew this year alone.

United Airlines came up with a different solution, opening up its own flight school, a first for any major airline in the United States.

UNIDENTIFIED MALE: The pilot shortage is real. We can hire pilots at United Airlines but the regional airlines and smaller airlines have a real pilot shortage and are having real challenges.

(END VIDEOTAPE)

MUNTEAN (on camera): United's flight school called the Aviate Academy and tuition costs about $70,000. They get all the licenses necessary to become an entry level airline pilot. But consider this, an airline captain make up to $400,000 a year. It is a great time to learn to fly. Airlines worldwide need to hire about 30,000 new pilots by 2025, that's to keep up with demand and retirements and remember, Jim, the retirement age is federally mandated at 65 years old, so a lot of people will age out soon.

SCIUTTO: Well, the delays are real. I've experienced them. I sure folks at home have, and sometimes people will whisper to you on the side, this is staffing issue.

MUNTEAN: People get it now and they're feeling it in a big way.

SCIUTTO: Yes. Pete Muntean, thanks very much.

MUNTEAN: Anytime.

GOLODRYGA: Well still ahead, heavy shelling across Mykolaiv, as targets the Ukrainian town one explosion right next to a church. You'll hear from a resident who witnessed it all, up next.

(COMMERCIAL BREAK)

[10:50:00]

GOLODRYGA: At least two people were killed in multiple attacks today in the southern Ukrainian city of Mykolaiv. A witness saw it all unfold.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Noise, the noise of a rocket flying and explosions, that's what I saw and heard when I was in the shop. People ran into the store and I saw people scared. I saw people dropping to the ground from explosions. Two people dead and one wounded man. He covered his wife with his body but got injured himself.

(END VIDEO CLIP) SCIUTTO: Civilians so often the victims of this war. That witness spoke to our Ed Lavandera who filed this report this morning.

(BEGIN VIDEOTAPE)

ED LAVANDERA, CNN SENIOR NATIONAL CORRESPONDENT: It has been a hectic night here and morning in the city of Mykolaiv, which is just west -- east of Odessa. We have been hearing bombardment throughout the night and in the distance, and then this morning in the early -- mid-morning hours, cluster bombs going off here in a residential neighborhood.

This is a park where we are told that, this morning, several people were walking around. And you can see the impact on the ground from various of -- these cluster munitions that detonated in a largely residential neighborhood, apartment buildings behind me. This is an orthodox church. And we will walk you back over here to show you one of the impact sites.

But officials here are telling us that at least two dead so far in the explosions and the attacks going on this morning. In fact, here at this church, they have spent the morning cleaning up the rather gruesome scene that was left here. This is one of the areas where people were killed. And they have actually already started covering up the impact site here.

This is just feet away from this orthodox church. This was actually much wider a little while ago. They have started filling it up. This is the glass and everything that they have been cleaning up from these windows. And you can see the damage inflicted here on this building.

One witness told us that the munitions were going off for almost ten minutes. They were dealing with all of that as people were scrambling try to figure out where to hide and where to get to safety.

[10:55:04]

And there had been attacks, according to officials, in various parts of this region, in the city, this morning. And as I told you off the top, we have been hearing bombardment.

The frontline is probably about 30, 45 miles away toward the city of Kherson, which is just down the road. And all up and down there, from the south up to the north, that's where the frontline has been in the last few days. So, attacks like this have -- and the sounds of this kind of warfare have been common. But an attack like this in the city, a deadly attack, really sends a great deal of anger.

(END VIDEOTAPE)

SCIUTTO: Yes, no one spared, right, so many in danger. Thanks so much to our Ed Lavandera for that report.

Thanks so much to all of you for joining us today. I'm Jim Sciutto.

GOLODRYGA: And I'm Bianna Golodryga.

At This Hour with Kate Bolduan starts after a quick break.

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