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U.S. Reports First Case of Monkeypox; Gas Prices Rising; Interview With Former U.S. Secretary of Defense Leon Panetta; NATO Expansion; President Biden Heads Overseas. Aired 2-2:30p ET

Aired May 19, 2022 - 14:00   ET

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

[14:00:23]

VICTOR BLACKWELL, CNN HOST: Hello. I'm Victor Blackwell. Welcome to CNN NEWSROOM.

ALISYN CAMEROTA, CNN HOST: And I'm Alisyn Camerota.

We begin with a foreign policy first for President Biden. He is headed to Asia right now for the first time as commander in chief to reinforce alliances in the East. And he's going just hours after a major moment for U.S. alliances in the West.

Today, the president welcomed to the White House, the leaders of Sweden and Finland, who are on the verge of joining NATO in response to Russia's war in Ukraine.

BLACKWELL: But, as the president looks to make advances abroad, at home, he's facing significant headwinds. We're talking recession fears, soaring inflation, a stock market sell-off, $4 dollar gas in every state, and a shortage of baby formula so severe, he invoked a wartime measure to increase production.

With us now, CNN White House correspondent Arlette Saenz and CNN Pentagon correspondent Barbara Starr.

Arlette, you're up first.

What is on the agenda for the president's visit?

ARLETTE SAENZ, CNN WHITE HOUSE CORRESPONDENT: Well, Victor, just to start off, you will have to forgive the noise. There's some construction here at the White House.

But President Biden is on Air Force One flying to Asia for his first trip to the region as president, as he wants to reinforce that that region means remains a central focus of his foreign policy.

Now, officials have said that he had hoped to get to the region much earlier in his presidency, but he had been constrained due to COVID concerns, as well as other brewing crises, including the war in Ukraine.

The president will first travel to Seoul, South Korea, where he will meet with the country's new leader. This comes as there are also provocations coming from North Korea in the region as the president is getting ready to head over on this trip.

After South Korea, the president will be heading to Japan, where he will meet with the country's prime minister, as well as participate in a series of meetings with the Quad leaders. That includes Japan, Australia and India, as the president is really looking to reinvigorate that alliance since taking office.

But so much of this trip will also revolve around not just bolstering those relationships with allies, but also countering China, but the U.S. is trying to maintain a competitive relationship with China as it continues to exert its economic and military influence in the region.

So this is certainly a high-stakes trip for the president, as he is trying to refocus his attention to Asia at this moment.

CAMEROTA: Barbara, let's talk about those provocations from North Korea.

So, as the president is en route to Asia, there are signs that North Korea may launch a test missile. What have you learned?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, U.S. intelligence is really watching this hour by hour now.

The concern, of course, is that they see that North Korea is making what they believe to be preparations for the test of an intercontinental ballistic missile, of course, a missile that, theoretically, if it works someday, would have the range to strike the United States, something the U.S. says it will not want North Korea obviously to have.

So what they're seeing is, at a launch site near Pyongyang, near the capital of North Korea, what is believed to be some of the final preparations for a possible test of an ICBM.

And what we now know, what has moved forward, if you will, are signs that they are collecting, intelligence they are collecting, that North Korea may be getting ready to put fuel, liquid fuel, inside the missile at this site. Some of the preparations that U.S. satellites are picking up with indicate that.

Now, when they put liquid fuel into a missile, it's like putting hundreds of thousands of gallons of gasoline into a rocket. So you don't let it sit around. It's one of the last steps before a missile would be fired.

Yesterday, the national security adviser, Jake Sullivan, said all the intelligence they have indicates that North Korea is getting ready possibly for this kind of provocation activity. And he said the U.S. would have a response if it happened, so watching very carefully. The window appears to definitely be open for some kind of North Korea missile test while the president is in the region.

BLACKWELL: All right, Barbara Starr, Arlette Saenz, thank you.

Now, before leaving for Asia, President Biden hosted leaders of Finland and Sweden at the White House, and he underscored America's support for their bids to join NATO.

(BEGIN VIDEO CLIP)

JOE BIDEN, PRESIDENT OF THE UNITED STATES: They have the full, total, complete backing of the United States of America.

So, let me be clear. New members joining NATO is not a threat to any nation. It never has been.

(END VIDEO CLIP)

[14:05:02]

CAMEROTA: CNN national security correspondent Kylie Atwood joins us now.

So, Kylie, the president was clear on where the U.S. stands. But Turkey can hold things up. So where does that stand?

KYLIE ATWOOD, CNN NATIONAL SECURITY CORRESPONDENT: Yes, that's right.

And the president didn't really directly address the concerns that Turkey has expressed. He talked about the U.S. working with its allies to work through any concerns that countries have. But he didn't get explicit when it comes to the fact that Turkey is standing directly in the way of Finland and Sweden joining NATO at this point.

Turkish President Erdogan has said that Turkey is not going to support these two countries joining NATO. And the reasoning for that is because Turkey believes that there are Kurdish terrorist organizations that are in those two countries, and they want the Swedes and they want the Finns to go after those terrorist organizations.

Now, we did hear, however, today from the president of Finland, who discussed the fact that they are acknowledging these concerns from Turkey, and they are willing to work on them. Listen to what he said.

(BEGIN VIDEO CLIP)

SAULI NIINISTO, PRESIDENT OF FINLAND: As NATO allies, we will commit to Turkey's security, just as Turkey will commit to our security.

We take terrorism seriously. We condemn terrorism in all its forms. And we are actively engaged in combating it. We are open to discussing all the concerns Turkey may have.

(END VIDEO CLIP)

ATWOOD: So, of course, the question is, how do they address those concerns? And how long is it going to take for these two countries to take actions that would make Turkey happy?

We still don't know the answer to that question. But it's very clear that, behind the scenes, the diplomats are really working on this issue. And though President Biden is very confident, expressing optimism, expressing a pathway forward to expanding NATO here, which is hugely significant, the logistics are still not figured out.

And this is a major hurdle for the NATO alliance.

BLACKWELL: Kylie Atwood for us.

Thank you, Kylie.

CAMEROTA: So, earlier today, the chairman of the U.S. Joint Chiefs of Staff, General Mark Milley, spoke with his Russian counterpart for the first time since the start of the war. Last week, U.S. Defense Secretary Lloyd Austin had a discussion with his Russian counterpart.

BLACKWELL: Former Defense Secretary Leon Panetta joins us now.

Mr. Secretary, thanks for being with us.

Erdogan, as you heard there in Kylie's report, says Turkey is a no on Finland and Sweden joining NATO. Of course, you need a unanimous support to ascend to the alliance. I spoke with an official, a former ambassador, who says this is all the negotiation and, in the end, they will be admitted.

Do you agree with that?

LEON PANETTA, FORMER U.S. SECRETARY OF DEFENSE: I do agree with that.

I think Turkey is basically using this as bargaining with regards to trying to get Finland and Sweden to make the case that terrorism among the Kurds is something that they're going to be concerned about.

I think, as you heard, both Finland and Sweden will move in that direction. I think Turkey ultimately will agree to allow both of them to become part of NATO.

CAMEROTA: Secretary, let's talk about what's happening in Ukraine right now.

A NATO official says that he does not expect to see any significant gains on either side, Russia or Ukraine, for the next several weeks. Basically, they're at a standstill. Do you agree? I mean, what's he basing that on?

PANETTA: Well, we're in this third stage of the war in Ukraine, having stopped the invasion, having seen the retreat of the Russians, having seen the destructive warfare that the Russians have engaged in.

I think we have entered a stage of a prolonged war of attrition right now, in which Ukraine will make some gains, the Russians will make some gains, but there will be no clear wins or losses. And so it's a -- it's a dangerous situation, because a prolonged war of attrition is one that ultimately could wear down particularly the unity of NATO and the U.S.

It could wear down the Ukrainians, and it could create a frustration that would be difficult to deal with in this situation. So it's not a good stage for this war. BLACKWELL: So, that same NATO military official says that the

advantage has shifted or at least momentum so significantly in the direction of the Ukrainians that there's now discussion about whether Ukraine will be able to reclaim control of Crimea from the Russians, the Donbass from the Russian separatists.

Is that realistic? Do you think that's possible?

[14:10:02]

PANETTA: Well, look, I think there's three courses here.

One is that the Ukrainians go on the offensive, and really try to go after these areas, like the Crimea and the Donbass and other areas, and really score some wins. The other is that they ultimately try to push for some kind of negotiated cease-fire with the Russians to try to end this destructive war and try to bring it to some kind of close.

And the third is that we engage in this prolonged war of attrition. It's one of those three. And I think the more likely scenario is a prolonged war of attrition right now.

CAMEROTA: Secretary Panetta, as the president heads to Asia right now, what do you think of China's warning, basically, that the U.S. shouldn't take even a position or basically express an opinion on Taiwan?

PANETTA: I think the president is doing exactly the right thing.

The fact that we have been able to unify NATO in dealing with Ukraine, I think, has sent a very strong message to Putin and Russia. I think we need to do the same thing with our other adversaries, whether it's China, whether it's Iran, whether it's North Korea. And the best way to do that is to build strong alliances that share our goals in dealing with those adversaries.

This is a real opportunity to build that alliance, particularly in the Pacific, not only on the basis of the Quad, Australia, South Korea and Japan, but also with the ASEAN countries in that region.

If we could develop a strong security alliance in the Pacific, that would be the best way to send a strong message to China about any further aggression on their part.

BLACKWELL: Mr. Secretary, I want you to listen to former President George W. Bush, had a bit of a slip-up in some remarks that he was delivering.

I see the smile. You know where we're going here.

Let's play it here. He was intending to speak about Vladimir Putin.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, FORMER PRESIDENT OF THE UNITED STATES: The result is an absence of checks and balances in Russia and the decision of one man to launch a wholly unjustified and brutal invasion of Iraq.

I mean, of Ukraine. Iraq.

Anyway...

(LAUGHTER)

BUSH: Seventy-five.

(LAUGHTER)

(END VIDEO CLIP)

BLACKWELL: What do you think you saw and you heard there, sir?

(LAUGHTER)

PANETTA: Well, I'm sure that the former president gives a lot of thought to what happened in Iraq. And that's playing somewhere in the recesses of his brain.

And, sometimes, when you -- you're out there in public, and you're speaking, those ideas suddenly come forth. And so it was an interesting slip.

But, as always, I think the president's main point was the right one, which is that we have to do everything necessary to unify against Russia in Ukraine.

CAMEROTA: Secretary Panetta, thank you.

PANETTA: You're welcome.

BLACKWELL: Gas prices keep going up and up, and diesel prices are hitting record highs in the U.S. The impact on the prices of things you buy every day, we will talk about that next.

CAMEROTA: And the White House takes new action to boost supply of baby formula. How soon will parents see the shelves restocked?

(COMMERCIAL BREAK)

[14:18:08]

BLACKWELL: The national average for diesel fuel is above $5.50 per gallon.

And with prices surging, ongoing shortages, analysts are calling it the next looming economic crisis.

CAMEROTA: Let's bring in CNN's Vanessa Yurkevich.

Vanessa, we know that you have been watching some oil tanks in New York Harbor. So, what have you seen?

VANESSA YURKEVICH, CNN BUSINESS AND POLITICS REPORTER: Victor and Alisyn, we are seeing record diesel prices right now, $5.58 a gallon average nationwide. That is a 50 cent increase in just the last month.

To put it into perspective, 2 to 3 cents increases are really being thought of as big deals. And we're seeing more than $2 in increases in just the last year.

But part of why this is happening is because of what is going on here in the New York Harbor. This is one of several points across the United States, seven, to be exact, where oil is imported and stored. And just right across the river in oil tanks, we're seeing alarmingly low levels of oil not seen in 30 years.

And that is concerning many experts, saying that that ultimately, those prices, those high prices, because of that low supply, get passed down to the consumer.

We spoke to one oil expert out on the water about why he's so concerned for consumers.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: At some point, the consumer is going to say, all right, enough is enough. I got to slow down because this is taking too much of my disposable income.

If we do have a pullback in economic activity, that might help kind of level off supplies, but, for the time being, things are really tight.

(END VIDEO CLIP)

YURKEVICH: And another factor making this market really tight right now is that the U.S. used to import Russian oil right here into the New York Harbor. But that has changed since the war in Ukraine, when President Biden announced that we would not be importing any more Russian energy.

[14:20:01]

And this area in particular is so key to serving the Mid-Atlantic region. So, when you have less diesel coming into this area, it can't get out quick enough to all of the businesses, all of the suppliers that need this critical oil in order to make their businesses run.

And that ultimately, Alisyn and Victor, unfortunately, that gets passed down to the U.S. consumer -- guys.

BLACKWELL: Vanessa Yurkevich setting the table for our next conversation. Thank you.

Patrick De Haan is the head of petroleum analysis at GasBuddy.

Patrick, welcome back.

So, Memorial Day weekend coming up soon. What should people expect to pay per gallon for travel that weekend?

PATRICK DE HAAN, GASBUDDY: Well, we continue to see gas prices go up, now the national average up another two-tenths of a penny so far today, the national average now $4.59 a gallon, although, like mentioned, if you're in diesel, $5.58 a gallon is far more of a cost to pay.

Americans, though, not being deterred, our travel survey indicating that 58 percent of Americans to hit the road this summer. That's up from last year against the backdrop of record highs, fairly impressive, but given the job market and the relatively strong economy and the fact that much of the economy has reopened, I think that is leading to what we're calling insatiable demand for gasoline as we approach Memorial Day.

CAMEROTA: Patrick, obviously, there's different costs in different states.

California drivers saw gas prices hit $6 a gallon, and J.P. Morgan thinks that $6 will become the national average before the end of the summer. Do you agree with that?

DE HAAN: I would take the under on that prediction. I think that's a little overstated.

I think demand destruction would likely kick in somewhere 70 cents a gallon underneath that. Now, with a hurricane, it remains a possibility that we could get there, although I say, at this time, it remains just a remote possibility.

BLACKWELL: So what are people supposed to do? I imagine driving from station to station looking for a nickel savings a gallon is counterproductive.

So how do they save money?

DE HAAN: Well, exactly. Nobody should be driving to station to station. They can use an app like GasBuddy or Google or ways to find those lower prices, especially for those hitting the road this holiday season, for Memorial Day.

Gas prices fluctuate significantly crossing state lines. They can be higher or lower different regions of the country, obviously, the West Coast kind of the hot spot for prices, whereas, inland, across the Midwest, prices are generally much lower.

But one other thing not so sexy to talk about, but slowing down, driving more fuel efficiently, can go a long way to increasing the amount of miles you get per tank.

CAMEROTA: And, Patrick, do you think it's time for families to change their summer plans because of all of this?

DE HAAN: Well, I think, certainly, the high cost is going to deter some of those especially lower incomes that are having a very hard time afford the increase in price.

We are seeing an interest in people that aren't driving quite as far for their travels. This year's summer travel forecast indicated a lot fewer people driving over two hours to get to their destination. So, it looks like people are kind of recalculating where they're going to go.

And, not surprisingly, inflation is making things hard to plan; 70 percent of Americans haven't really confirmed their summer travel plans yet, 40 percent saying the high price or high inflation is a contributing factor to that.

BLACKWELL: Patrick, on diesel specifically, diesel up at $5.58 a gallon, of course, hitting some highs there, some companies are now laying off truck drivers because of the high price of diesel.

The lack of truck drivers then feeds into the supply chain issues. The supply chain issues cycle back to the increase in prices. And we find ourself in this cycle that everything just simply costs more.

DE HAAN: Yes, absolutely.

And a lot of this cost -- keep in mind, the surge in diesel has only been really recent, in the last couple of weeks, as you mentioned. Diesel prices have really exploded in the last month. So a lot of that is starting to hit the grocery store, the hardware store and those secondary places.

So, not only are consumers paying more for gasoline, but they're getting hit hard by diesel when they're going to the store and buying those goods that in many cases are arriving there via semitruck or train. So it's kind of the hidden cost, and likely to continue pushing inflation up.

CAMEROTA: OK, Patrick De Haan, thank you.

DE HAAN: Thanks for having me.

BLACKWELL: All right, the U.S. sees its first case of monkeypox. What the surgeon general says you should be looking out for.

And the baby formula shortage now causing some children to be hospitalized. We have their stories next.

(COMMERCIAL BREAK)

[14:29:25]

CAMEROTA: The CDC is now monitoring several people for monkeypox after the first case was reported in Massachusetts.

Monkeypox is a flu-like illness that is rare in humans, but it can be serious.

BLACKWELL: Now, in Canada, Montreal Public Health just announced that it is investigating 17 suspected cases. And scientists are tracking several clusters of the virus in Portugal, in Spain, and the U.K.

CNN senior medical correspondent Elizabeth Cohen is with us now.

So, now there's monkeypox. What are the symptoms? How does it spread? What do we need to know?

ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: Well, the first thing I want to say, because we're coming off of two years of COVID, is that this virus does not spread nearly as quickly or easily as COVID.