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Rishi Sunak Will Become UK's Next Prime Minister; Ukraine Invites IAEA Experts To Examine Facilities Amid Russian Claims Of "Dirty Bomb"; Dozens Killed By Military Airstrikes During Celebration Event In Myanmar; U.S. Charges Alleged Chinese Spies In Telecoms Probe Case; Iran Charges 300 People Over Protests, Four Could Face Death Penalty. Aired 1-2a ET
Aired October 25, 2022 - 01:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
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LAILA HARRAK, CNN ANCHOR: This is CNN Newsroom. I'm Laila Harrak. Ahead this hour. Third time's the charm the man set to be Britain's third Prime Minister in two months hopes to end the political and economic chaos gripping the country.
The West slams Russia's dirty bomb claims which are fueling fears of an uncontrolled escalation in Ukraine and U.S. officials accused several people of spying for the Chinese government.
A historic moment for the UK in the hours ahead, Rishi Sunak will become the country's new Prime Minister, the third in just seven weeks. Mr. Sunak won the Conservative Party's leadership race setting him up to become the youngest Prime Minister in more than 200 years, and the first person of color to hold the job.
He'll have an audience with King Charles where he will officially be appointed to the post. Mr. Sunak is replacing Liz Truss, who stepped down after just 45 days amid political and economic turmoil.
(BEGIN VIDEO CLIP)
RISHI SUNAK, INCOMING BRITISH PRIME MINISTER: We now need stability and unity. And I will make it my utmost priority to bring our party and our country together. Because that is the only way we will overcome the challenges we face and build a better, more prosperous future for our children and our grandchildren.
(END VIDEO CLIP)
HARRAK: While Mr. Sunak is promising to tackle the challenges including a major economic crisis, but has not yet given any details on his planned policies, while the 42-year-old last served as Britain's finance minister. Mr. Sunak was first elected to Parliament in 2015, before taking on his first major government role as Chief Secretary to the Treasury in 2019 while he's now tasked with bringing together his own party and the country amid calls for a general election.
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ANGELA RAYNER, BRITISH LABOUR PARTY DEPUTY LEADER: Labour thinks that we should be having a general election I think everybody who I've spoken to the public have said we should be having a general election there is no mandate. Now the Conservatives are completely broken their promises broke our economy. And now they want to see a general election. They can't just keep doling out Prime Ministers every month because they're in total chaos and they've lost control of the market and haven't got any ideas of how they're going to tackle the cost of living that people are facing.
(END VIDEO CLIP)
HARRAK: CNN's Bianca Nobilo joins us now live from London. Bianca is everybody breathing a sigh of relief where you are?
BIANCA NOBILO, CNN CORRESPONDENT: Well, I know that the Conservative MPs that I've been speaking to are definitely breathing a sigh of relief. They were not unaware of how disunited how fractious that the party was seeming over recent weeks. So they're hoping that Rishi Sunak will allow them a sort of a stay of all the turbulence that he will be a safe pair of hands who will reassure the markets, and that maybe they can begin to restore the faith and trust of the British people in the Conservative Party.
That's in fact, what Rishi Sunak said, he saw as his two primary objectives, first of all, to try and avert a deeper economic crisis, stabilize the economy, but also to restore the public's trust in the Conservative Party, and Sunak is perhaps best place to the candidates that were on offer to do that.
His experience in government has been in economic roles, notably as Chancellor during the COVID-19 pandemic, but also in many ways he does bring unprecedented attributes to the role.
Let's take a look about how he got here.
(BEGIN VIDEO TAPE)
NOBILO (voiceover): After making the runoff in the second leadership contest in as many months, it's second time lucky for Britain's new prime minister Rishi Sunak, but that is where his luck runs out. Sunak inherits an economic nightmare stoked by soaring inflation, war in Europe, a party at its lowest level of popularity in a generation, eating itself alive, changing prime ministers at a pace never seen.
LIZ TRUSS, FORMER BRITISH PRIME MINISTER: I am resigning.
[01:05:03]
NOBILO: The last list trust became Britain's shortest serving leader ever at a mere six weeks. But the former chancellor has not sugar coated the challenges Britain faces, assuring that he has the economic credentials to steer the nation through the crisis. SUNAK: We have to be honest, but borrowing your way out of inflation isn't a plan. It's a fairy tale.
NOBILO: The predictions he made about the impact of Truss's tax cutting economic plans were vindicated. On two parents of Indian descent, Sunak is Britain's first person of color to become prime minister. But his path to power is a tale as old as time.
Educated at one of Britain's most exclusive schools Winchester College on to Oxford University like over half of the country's Prime Minister, then into the finance industry. After being praised for slick performances during the pandemic, he was tipped to become the next leader. Then his political fortunes took a nosedive.
Sunak's resignation as Chancellor in the last days of the Boris Johnson government was seen as being instrumental in Johnson's downfall. Then, Sunak lost the leadership contest to replace Johnson after his popularity had taken a battering, with many Johnson supporters blaming him for Johnson's end.
The London police had fined him for attending an illegal gathering and lockdown and his wife Akshata Murthy, the daughter of the Indian billionaire founder of Infosys, came under fire for her non-domicile status, sparing her a huge tax bill on her massive foreign income. Sunak ranks among the UK's richest and has been labeled out of touch with ordinary voters.
SUNAK: For friends who are in a working class, but I'm not working class, but I mix and match and then I go to see kids from another city state call and tell them to apply to Oxford.
NOBILO: This 2001 BBC documentary clip when he was still at university later went viral and didn't help. He since walk back that comment, but this didn't help either.
Now Sunak leads Britain at a time when millions fear they won't be able to afford their food and heating this winter.
KEVIN HOLLINRAKE, BRITISH CONSERVATIVE MEMBER OF PARLIAMENT: I think Rishi does have the characteristics that will could restore faith in our party. Yes, I mean, I think he's demonstrated that. You could judge people on their actions, not their words.
NOBILO: The moment calls for a shrewd political operator, a powerful communicator, a unifier. Sunak will be tested and judged immediately.
(END VIDEO TAPE)
NOBILO: Laila, because there has been so much focus and spearheaded by the opposition Labour Party as you just played on whether or not Sunak has a proper mandate to govern because he hasn't won a general election, he's just been elected by Conservative Party MPs.
One of the tasks that he'll have front of mind today, when he addresses the nation behind the podium on the steps of Downing Street behind me later, will be to try and make the point that he's the country's Prime Minister to. So far, all of the discussion has been around conservative factions and trying to make himself appeal to the party.
But now you'll have to convince the country at large that he's the right person to lead, and in many ways introduce himself and his politics because many aspects of how he'll govern and what he believes still remain unknown.
HARRAK: Bianca Nobilo in London, thanks so much. And joining us now from Los Angeles is seen as European Affairs commentator, Dominic Thomas, so good to see you, Dominic. Rishi Sunak is breaking barriers. When you reflect on this very moment, because the fact that he has not been popularly elected change the significance of this moment.
DOMINIC THOMAS, CNN EUROPEAN AFFAIRS COMMENTATOR: Yes, Laila, I think it does, and especially when it comes on the heels of the fact that Liz Truss did not get was not elected through a general election. And I think, in many ways, Rishi Sunak situation is even more problematic because this time around, there was no general election. And the election ended with just the MPs, who for the second time, in just a few months, placed him at the head of the leadership challenge within the Conservative Party, but this time around, they did not even go to the membership. And so that I think has taken it, therefore, Laila, to a new level.
HARRAK: To a new level, his economic credentials, obviously, Dom, speak for themselves. But do we know where he stands on other issues?
THOMAS: Well, I think that that's where the bigger question comes in. He's been talking about unity moving forward. I think ultimately, there are two ways of thinking about that. Unity can mean bringing the party together with this majority that they hold with the time that they have if they can hold off to a general election and push through on various policies pertaining to the economy, to society, and so on.
Where I think it gets more problematic is that if they're unable to sort of work with that kind of model of unity and ultimately what you end up doing is bringing people together yet again as with the Brexit debate and coalescing around being against something.
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In other words, against the Labour Party, issues around immigration and so on. In other words, going with that right wing side of the party that has been more adept at instrumentalizing voters, through emotions, and through a kind of populist agenda.
I don't think that's the direction that he wants to go in. But it's going to be interesting to see how he goes about building the cabinet. And I think that will send a very strong message as to the initial direction he's going to go, in the few days that we will have to write the ship after the storm.
HARRAK: Rishi Sunak is known as the chancellor. But what kind of Prime Minister do you think he is going to be? THOMAS: Well, when you compare him to many of the people in the Conservative Party, he's a relatively new figure, and somewhat untested. One could say he was for a short period at the helm and as Chancellor of the Exchequer. He's incredibly young to be taking over this position at just 42 years old. So I think that there are going to be some questions around that sort of maturity and ability to bring people together.
But on the other hand, one hopes that that youthfulness, that connectedness to some of the more important and urgent issues of the 21st century might help him shape things in new directions. The question is how much leeway he has, as he has to on the one hand balance this incredibly fractured Conservative Party, while at the same time knowing that the pressure from the general public and from the opposition is going to be absolutely enormous to go to a general election.
And if he's seen to be inconsistent or uncertain, they will be looking out for that. And that will further weaken, because ultimately, the number one mission that he has ahead of him is to win a general election, and that is going to be hanging over him in the weeks and months and years to come if he's able to hold on that long.
HARRAK: Exactly. It will be hanging on maybe above his head as a dark cloud. Do you expect the clamor for a general election now to die down or to grow even louder?
THOMAS: I think that, essentially, it's no, it's going to be there. The ultimate goal of the opposition, of course, is to push for a general election. I think there will be some moment of patience to see whether in conjunction with his cabinet, and he's able to make tangible changes, but we're a long way away from the debates and the emotions around Brexit.
The people are concerned. The electorate are speaking to their MPs about this particular thing about all the economic issues that are there. And unless those tangible policies that can be communicated and translated to the general public in the short term, that pressure to go to a general election and is going to be on him. And at this particular juncture, we know that the Conservative Party is not going to fare well in that.
So, it's an enormous task that he has, and in many ways, an unreasonable task to be placed on the shoulders of somebody who is so young and around whom there is a tremendous level of expectation within the party now.
HARRAK: Dominic Thomas in Los Angeles, thank you so much.
THOMAS: Thank you, Laila.
HARRAK: The UN's nuclear watchdog has accepted an invitation to examine two of Ukraine's nuclear sites. The Ukrainian government requested the inspections to try to disprove claims that it might use an explosive mixed with radioactive material on the battlefield. Russia has insisted without proof that Ukraine plans to use a so called Dirty Bomb on its own territory in a false flag operation and according to Reuters, Russia will raise the issue to the UN Security Council on Tuesday.
But Ukraine and the West reject Moscow's allegations. And NATO's Secretary General says Russia must not use it as a pretext to escalate the conflict. The U.S. has suggested it's actually Russia who might use a dirty bomb and warned of consequences if it does.
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NED PRICE, U.S. STATE DEPARTMENT SPOKESPERSON: We're concerned when we hear this type of patently false disinformation emanating from the Kremlin. We know the Kremlin's track record when it comes to these types of claims.
(END VIDEO CLIP)
HARRAK: While all of this is happening as Ukraine is trying to retake the southern city of Kherson. A Ukrainian defense official says Russian occupiers are trying to push back the offensive by bringing new military units into the city. Nearby Russia has also been launching missile strikes on the city of Mykolaiv. Many residential areas have been hit leaving people in a constant state of anguish. CNN's Clarissa Ward has their story.
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CLARISSA WARD, CNN CHIEF INTERNATIONAL CORRESPONDENT (voiceover): By now it has become a familiar routine in Mykolaiv. In the relative calm of daylight hours, residents combed through the wreckage of the night before.
On this day, it's an apartment building on the outskirts of town. Two Russian S-300 missiles hit at one in the morning.
WARD (on camera): So this here is where the first strike hit. And then you can see the second one just smashed in to the top of that building.
WARD (voiceover): Five people were injured but miraculously no one was killed. In one apartment, Andriy (ph) is busy cleaning up. He tells us this is what the Russians do. They shoot not at military objects but where people live, he says. The fact is the anger towards them is rising and it won't go away. Not in a month, not in a year, not even 10 years.
In this southern port city, people have become used to hardship. Since April there has been no fresh water here. The main pumping station was hit in a Russian strike. Now they gather every day and patiently wait to stock up.
A few blocks down another line, this one for humanitarian aid. Will I be able to get something today? This old woman asks. We already have 100 people on the list, the organizer replies.
Mykolaiv is less than 20 miles from the nearest front lines and just 35 miles from the Russian health city of Kherson.
Last week, Russia announced that civilians must leave Kherson, warning of an imminent Ukrainian attack. Ukraine called it propaganda to distract from recent Ukrainian military gains. It is difficult to get a picture of what's really going on in Kherson.
But we managed to connect with one resident who we will call Vitali (ph) who took these videos. The streets he says are empty. But there are people in the markets. Most vendors no longer want to take Russian ruble as they prepare for a potential Russian withdrawal.
WARD (on camera): Do you have a sense of whether Russian forces have left the city or not?
UNIDENTIFIED MALE (through translator): There were a few Russian soldiers here but you find them around the city. Several days ago, there was a rotation and they brought in new soldiers. Part of the soldiers who were here for a while they left and the new ones came. Probably they are mobilized conscripts. They don't even know what city they're in.
WARD: And why did you decide to stay? Are you not frightened?
UNIDENTIFIED MALE (through translator): It's our city. We believe that we have to wait until our army comes. I can't say we are not afraid. We are afraid. But this is our decision.
WARD (voiceover): The people who remain in Mykolaiv have made a similar decision. Back at the strike site the cleanup has already begun as the city braces itself for the next attack. Clarissa Ward, CNN, Mykolaiv, Ukraine.
(END VIDEO TAPE)
HARRAK: While Russia's state controlled television channel RT has suspended a presenter after his on air comments that Ukrainian children in the 1980s who saw Russian forces as occupiers should have been drowned. RT's editor-in-chief denounced those comments calling them wild and disgusting.
Ukraine's Foreign Minister tweeted that countries should ban RT saying the comments amounted to aggressive genocide incitement. The presenter has since apologized.
Much more ahead this hour on CNN Newsroom, including criminal charges from the U.S. Justice Department for six people accused of spying for China. And in Iran, we're hearing hundreds of protesters have been charged and dozens of journalists detained the latest on the government's crackdown on dissent.
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[01:21:19] HARRAK: As many as 50 people are dead after a military airstrike in northern Myanmar on Sunday. That's according to local media. CNN cannot independently verify the number of deaths. This video was shared by a rebel group in the region and they claim it shows the aftermath of the attack.
According to Reuters, the strike hit a concert organized by an ethnic minority group opposed to the ruling military. The ambassadors or 14 countries signed a joint statement criticizing the military authorities saying this attack underscores the military regime's responsibility for crisis and instability and its disregard for its obligation to protect civilians and respect the principles and rules of international humanitarian law.
The U.S. Justice Department is cracking down on alleged Chinese spies. Attorney General Merrick Garland has announced charges against six people. Four are accused of working under the cover of a fake think tank to recruit Americans to work as assets for the Chinese government. Prosecutors say they tried to bribe their targets with lavish gifts, including all expenses paid trips to China.
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MERRICK GARLAND, U.S. ATTORNEY GENERAL: The indictment alleges that between 2008 and 2018, the defendants use the cover of a purported Chinese academic Institute to target, co-opt and direct individuals in the United States to further the PRC's intelligence mission.
Those directors included attempts to procure technology and equipment from the United States and to have it shipped to China. They also included attempts to stop protected First Amendment activities, protests here in the United States, which would have been embarrassing to the Chinese government.
(END VIDEO CLIP)
HARRAK: While two others are accused of trying to undermine the U.S. government's case against a Chinese telecommunications company. A person familiar with the investigation tells CNN that company is Huawei.
While in China, speaking out publicly against the government and its strict zero COVID policies is rare, so protesters are turning to a more private venue to vent their anger. CNN's Selina Wang reports.
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SELINA WANG, CNN CORRESPONDENT (voiceover): Graffiti with angry messages scribbled all over bathroom stalls might be a common sight in much of the world, but not in China. The Chinese character scrawled in this Beijing bathroom breeds anti-dictatorship, anti-COVID tests. Messages like this are spreading in bathrooms in several Chinese cities. It's because public restrooms are one of the only places in tightly surveilled China without security cameras.
This graffiti says remove dictator and national trader Xi Jinping. Some of them even written in English. No to COVID test, yes to food. No to lock down, yes to freedom. No to great leader, yes to vote. Don't be a slave, be a citizen.
Their message is copy the slogans written on two banners hung on a busy overpass in Beijing. A rare protest in the capitol just days before the start of the Communist Party Congress. The banners cleaned up then quickly censored from Chinese social media.
But it didn't stop people from replicating the act around the world. The same slogans hung on London's Westminster Bridge and draped over the Chinese Embassy in London. But inside China, public displays of dissent towards Xi are extremely rare. It can lead to long prison sentences or even worse.
[01:25:04]
We spoke to one man who graffiti in a bathroom for shielding his identity because of fears of retribution.
UNIDENTIFIED MALE (through translator): I had to wear a mask. And when I was writing, I was worried someone might catch me. We can only write slogans in places like bathrooms to express our political views. It's so pathetic we've been suppressed to this degree.
WANG: In another Chinese city, a person wrote the same slogans with a picture of Winnie the Pooh and a crown canceled. China has censored any images of the cartoon character being compared to Xi. The author texted CNN, I hope people who see my slogan can start changing their minds realizing they've been brainwashed.
We have no way to independently verify all of the graffiti, and it's unclear how widely held these views are in a police state. But frustrations in China over the country zero COVID measures are growing. Harsh lockdowns over a handful of COVID cases, constant COVID testing, mass quarantine facilities. The anti-Xi slogans are rapidly spreading from China to campuses in America and around the world.
And in Paris, an outdoor play to parody Xi Jinping's rule. Xi dressed up in the Emperor's clothes than being dragged down by COVID enforcers.
CHIANG SEETA, CHINESE STUDENT IN PARIS (through translator): If we don't do anything, it means we're willing to be ruled by the CCP. When I saw the graffiti in that bathroom, I started crying. It shows that some of the Chinese people want democracy and freedom of speech and are willing to pay a price for it.
WANG: Yet Xi's power is ironclad. The public's anger reduced to scribbles in bathroom stalls, and even those will be quickly painted over. Selina Wang, CNN, Hong Kong.
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HARRAK: The Palestinian health ministry says at least five people have been killed in the West Bank after Israeli forces conducted a raid against an armed group. They say at least four Palestinians died during the operation in south and a fifth person who was killed during protests against the raid.
Israel says it was trying to shut down a militant hideout which it says was used to manufacture explosives.
An Iranian court has charged more than 300 people with conspiracy and collusion to damage national security. That's according to state aligned media. Four of the demonstrators face a much more dire charge of war with God, which could lead to the death penalty.
While this legal action comes more than five weeks into anti- government protests that have erupted across Iran, many of them on university campuses. Activist outlets like the student news network hosted video of this rally in Tehran on Monday. And Iran Wire says these images show students in the city of this full chanting freedom.
Well, meanwhile, at least 40 journalists are among those who have been arrested by Iranian authorities. This according to the Committee to Protect Journalists. CNN's Nada Bashir picks up the story.
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NADA BASHIR, CNN REPORTER (voiceover): Women, life, freedom. The rallying cry that is only growing stronger as protests in Iran into this six week sparked by the death of 22-year-old Mahsa Jina Amini, who died in the custody of Iran's notorious morality police in September.
But as the regime intensifies its brutal and deadly crackdown on protesters, it's also scrambling to control the narrative, jailing at least 40 journalists as protest first began, according to the CPJ.
YEGANEH REZAIAN, SENIOR RESEARCHER, COMMITTEE TO PROJECT JOURNALISTS: These are just estimation, I'm sure that correct tallies over 400. Several of the cases of these journalists that we have covered as soon as they reported about those news on their Twitter channels. The next day they were arrested.
BASHIR (on camera): And just walk me -- walk me through the tactics being used by the Iranian regime. How are journalists in Iran being repressed?
REZAIAN: Security forces usually raid the homes of journalists after midnight in order to create an environment of scare and fear. They usually transfer these journalists immediately to solitary confinement. In most cases they don't let the journalist have access to lawyer.
BASHIR (voiceover): Much of Iran's media is under state control with journalists who reject the state's narrative facing harsh penalties. Among them Nilofar Hamedi, one of the first journalists to break the story of Amini's death in Iranian media.
UNIDENTIFIED MALE: We know that Nilofar Hamedi has been held in solitary confinement.
BASHIR: Here in London, journalists at the pro reform news outlet Iran Wire which has been working with CNN to cover the ongoing protests. are meticulously documenting the detention of journalists in Iran.
[01:29:32]
BAHARI: One of them needs to be confirmed.
BASHIR: It's a growing list, with a concerning lack of clarity on where many of these journalists are being held.
Among them are citizen journalists, bravely documenting the regime's crackdown on their phones and on social media.
BAHARI: So far our citizen journalists inside the country, are the most important colleagues we have. And without them, we wouldn't be able to operate. These are the people who risk their lives in order to report.
BASHIR: With Internet black outs being used by the Iranian authorities as a tool to stem the spread of information, the role of journalists on the ground bearing witness to atrocities perpetrated by the Iranian regime is growing more important and more dangerous.
Nada Bashir, CNN -- London.
(END VIDEOTAPE)
HARRAK: We are following developments from the U.K. where Rishi Sunak is expected to meet soon with King Charles. How the next prime minister plans to address Britain's economic crisis just ahead.
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HARRAK: You are watching CNN NEWSROOM. I'm Laila Harrak.
Let's get you up-to-date now on our top story.
We're just about four hours away from Rishi Sunak's audience with King Charles where Mr. Sunak will become the next British prime minister.
Mr. Sunak will inherit a conservative party in turmoil at a time of spectacular hardship for Britain. He is promising to focus first on economic stability.
Mr. Sunak will become the first person of color, the first Hindu, and the youngest person in more than 200 years to lead the government.
(BEGIN VIDEO CLIP)
RISHI SUNAK, INCOMING BRITISH PRIME MINISTER: I'm humbled and honored to have the support of my parliamentary colleagues and to be elected as leader of the conservative and unionist party. It is the greatest privilege of my life to be able to serve the party I love, and give back to the country I owe so much to.
(END VIDEO CLIP)
HARRAK: Well wishes for Rishi Sunak are coming in around the world. European Council President Charles Michel tweeted his congratulations, adding, "Working together is the only way to face common challenges and bringing stability is key to overcoming that."
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HARRAK: And U.S. President Joe Biden offered his congratulation during a White House reception, celebrating Diwali, a Hindu festival of lights.
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JOE BIDEN, PRESIDENT OF THE UNITED STATES: It's pretty outstanding. A groundbreaking milestone, and it matters. It matters.
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HARRAK: More now on Mr. Sunak's rise to power from CNN's Max Foster, reporting from London.
(BEGIN VIDEOTAPE)
MAX FOSTER, CNN CORRESPONDENT: There are many firsts here. Rishi Sunak is the youngest prime minister in more than 200 years. He is the first person of color, and the first Hindu.
BARNIE CHOUDHURY, EDITOR AT LARGE, EASTERN EYE: It is ginormous. It is momentous. It is your Obama moment that happened in the United States in 2008. That is how significant it is.
FOSTER: But there is a huge amount of disillusionment about British politics right now. This is our third prime minister in less than two months.
Rishi Sunak will have a chance to convince the British public that he is the right choice this time, when he addresses the nation on Tuesday after being formally appointed prime minister by King Charles III.
We know that he has a strong record in finance, having been finance minister throughout the pandemic. But what about his foreign policy, for example? What about his view and how hawkish he is on the war in Ukraine?
We know he has a special relationship of his own with America, having attended Stanford University to study an MBA. That is where he met his wife, the daughter of an Indian billionaire.
They are a very rich couple. They are richer, even than the king. So they will have to convince the British that they are the right people, they can relate to people going through cost of living crisis. A huge amount of weight on Rishi Sunak's shoulders.
But there is real hope here that he has the experience and the weight to carry Britain through.
Max Foster, CNN -- Westminster, London.
(END VIDEOTAPE)
HARRAK: For more, we are now joined by Catherine Rampell. She is a CNN economic and political commentator and opinion columnist for the "Washington Post". Thank you so much for joining us.
Let's first listen to the new British prime minister, and then we'll kick off our conversation right after that.
(BEGIN VIDEO CLIP)
SUNAK: The United Kingdom is a great country. But there is no doubt that we face a profound economic challenge. We now need stability and unity. And I will make it my utmost priority to bring our party and our country together.
(END VIDEO CLIP)
HARRAK: He is making history, but he has a very tough road ahead. What would you say is top of his to do list?
CATHERINE RAMPELL, CNN ECONOMIC AND POLITICAL COMMENTATOR: It is dealing with the British economy, which has been struggling for some time as are many developed countries and emerging economies around the world.
But the U.K. has suffered from low growth for a long time, even before the pandemic and today inflation is at 40 year highs, as it is in much of the world. As well as, you know, the Bank of England recently determining that the country is already likely in a recession.
So his task ahead is figuring out how to dig the British economy out of this hole, without totally destroying the federal budget, essentially. And that is a really challenging task.
HARRAK: It is a very delicate balancing act, isn't it because does he come into office partially vindicated, even though the situation that he inherits as you lay out is significantly worse than a couple of months ago?
RAMPELL: Well he had warned, as you may recall when he and Liz Truss his now predecessor were going head to head. He had warned that her economic agenda would be catastrophic. The agenda being, essentially, to cut taxes a lot as well as, you know, increase spending in some areas, including on energy subsidies, all of which he seemed to be right about.
I'm sure he feels somewhat vindicated, as you put it today because he lost out when he was going head to head with Truss and his predictions more or less proved truth. Financial markets were very unhappy with the agenda -- the so-called mini-budget.
And Truss' government essentially had to walk back and do a U-turn on those tax cuts, as well as much of the rest of the economic agenda, because the pound was plummeting and, you know, bond yields were rising so much. So yes, he looks pretty smart. It is easy of course to say what
policies are a bad idea, the challenge is coming up with the good ones, the ones that will be more effective.
[01:39:56]
HARRAK: Exactly. I mean will he be able to pull off what Liz Truss was not able to do? Will he be able to repair Britain's bruised reputation on the world financial markets?
RAMPELL: Well he does seem more devoted to fiscal discipline than his predecessor. Truss said yes, we are cutting taxes but we will grow our way out of debt which is nice thought, but perhaps a little Pollyanna- esque.
He has now said that he is now committed to filling in the budget hole. He is committed to making sure that budgets are more or less paid for, despite the trying times that we are in.
And I think that is what financial markets want to hear. The concern, of course, before was that the debt was going to run out, would lenders -- essentially people who are buying debt from the British government, would they be repaid, or what would happen to the value of the pound. Would the payment actually be as valuable as hoped?
So financial markets seem to like what's been offered so far, but it is a little bit hard to read the signals just yet, because we haven't seen the full economic plan put forward by Sunak.
HARRAK: Exactly. We haven't really seen any details on any policy so far.
The British public and the world know him as the chancellor. Will his background help him or hinder him?
RAMPELL: I don't know. That is a good question. You know, he did pretty well in private financial markets before. Maybe that will gives investors more confidence in any event (ph) in his ability to understand how markets are likely to react to any particular policy. He still has to deal with political shoestrings, however.
For example, you know, there's going to be a big debate going forward about the adjustment in essentially -- the cost of living adjustment for benefits of various kinds. Do they get adjusted according to the overall inflation levels, according to how earnings are rising, et cetera?
Even if he knows that it is probably more fiscally responsible to take the lower of those two potential indices, i.e. the earnings one, it is going to be very unpopular especially with people who are already retired, pensioners.
So he may have some better instincts, I guess, about what is likely to play well with the financial markets, but that does not necessarily mean that he will be able to act on them. Or he will have, you know, the political prowess necessary to convince his colleagues. So we'll have to see.
HARRAK: We will have to see, indeed. Catherine Rampell, thank you so very much.
RAMPELL: Thank you.
HARRAK: We are going to take a short break, and we will be back in just a moment.
[01:43:01]
(COMMERCIAL BREAK)
HARRAK: The U.S. midterm elections are two weeks away, and with polls showing Republican momentum in some key House and Senate races, the Democrats are making a late push to fine-tune their message to voters.
President Joe Biden called on fellow Democrats to persevere, pointing out key economic policy victories since the start of the pandemic as well as the party's staunch defense of abortion rights.
But many races are too close to predict as election day closed draws near.
CNN's Jeff Zeleny has more from Philadelphia.
(BEGIN VIDEOTAPE)
JEFF ZELENY, CNN CHIEF NATIONAL AFFAIRS CORRESPONDENT: On the eve of a critical debate, all eyes are on Pennsylvania in the fight for control of the Senate, as Democrat John Fetterman and Republican Mehmet Oz share a stage for the first time.
DR. MEHMET OZ (R), PENNSYLVANIA SENATE CANDIDATE: Thank you very much.
ZELENY: A new CNN poll shows Fetterman with a narrow edge, 51 to 45 percent, just outside the survey's margin of error, as Oz works to boost his campaign two weeks before election day, the race to fill the seat of retiring Republican Senator Pat Toomey has played out a bitter, long distance duel with a sharp focus on Fetterman's recovery from the near deadly stroke in May.
JOHN FETTERMAN (D), PENNSYLVANIA SENATE CANDIDATE: It is the elephant in the room, having a stroke.
ZELENY: At a weekend campaign stop, Fetterman explaining how he will use close captioning during his face-to-face encounter with Oz Tuesday night.
FETTERMAN: The lingering issue is they called auditory processing, which makes it, I hear and I understand everything in terms of words on paper and understand what I hear. But when we are talking about very specific and having things like this we're going to need -- I need captioning. ZELENY: Today, Oz unveiling a plan to fight crime, an issue that has
been front and center in their contest. With President Biden spending most days off the campaign trail, he made a brief visit today to the Democratic National Committee's headquarters in Washington.
BIDEN: The choice could not be clearer. The stakes could not be higher.
ZELENY: The economy is top of mind for voters, and should be more of a priority for Democratic candidates, Senator Bernie Sanders told CNN's "STATE OF THE UNION".
SENATOR BERNIE SANDERS (I-VT): I'm worried about the level of voter turnout among young people and working people who will be voting Democratic. And I think again what Democrats have got to do is contrast their economic plan with the Republicans.
ZELENY: All this as more 7.3 million ballots have already been cast in 39 states across America, including more than 1 million in Florida, more than 830,000 in Georgia and a half million in Pennsylvania. Tonight, Florida taking its turn in the spotlight.
GOVERNOR RON DESANTIS (R-FL): Have any of you voted yet?
How many of you are waiting until election day?
ZELENY: With Republican Governor Ron DeSantis facing challenger Charlie Crist for their first and only debate in a race Democrats hope would slow DeSantis rapid rise through the GOP.
And Arizona with key races for Senate and governor on the line, new fears of rising tensions. Officials say two armed individuals dressed in tactical gear spotted at a ballot drop box in Mesa. Separately, the Arizona Secretary of State's office said it referred to the Justice Department and the state attorney general a report of voter intimidation.
GOP gubernatorial candidate Kari Lake already taking a page from the Trump playbook questioning election integrity with no evidence.
KARI LAKE (R), ARIZONA GUBERNATORIAL CANDIDATE: I'm afraid that it probably is not going to be completely fair.
ZELENY: And that debate here in Pennsylvania on Tuesday night just two weeks before election day, certainly will give voters a big sense of the differences between the candidates, but even more than that.
John Fetterman, of course, suffered a stroke several months ago. He will be using close captioning, something that is usually not seen in debates. So as Dr. Mehmet Oz of course, played a television doctor for so long, how he treats his rival will also be interesting.
But the reality is there are stark differences on issue sets -- on crime, on the economy, on abortion. There's no doubt that this Pennsylvania senate race is one of the closest in the country.
Jeff Zeleny, CNN -- Philadelphia.
(END VIDEOTAPE)
HARRAK: The U.S. has placed sanctions on Nicaragua, targeting some of the country's most profitable industries. It is an attempt to hold President Daniel Ortega's government accountable for its attacks on freedom of expression and assembly.
Stefano Pozzebon is tracking the story from Colombia.
(BEGIN VIDEOTAPE)
STEFANO POZZEBON, JOURNALIST: The Biden administration has announced on Monday sanctions against over 500 Nicaraguans linked to the government of Daniel Ortega as well as the Nicaraguan general director of mines as a key asset provider to the government.
[01:49:46]
POZZEBON: Among the officials individually targeted is Reinaldo Cerna, a former head of security and a close confidant of Daniel Ortega and allegedly responsible for widespread repression of dissent and even torture, according to the White House.
But perhaps the most significant measure is the prohibition for U.S. citizen and entities to trade in the Nicaraguan mining sector. Gold mining is the top export for Nicaragua worth more than $660 million in 2020, according to the World Bank.
In a statement announcing the measure, the U.S. Treasury and the secretary for terrorism and financial intelligence Brian Nelson, said that the new sanction targets the resources the Ortega government uses to undermine democratic institutions in Nicaragua.
The sanctions are the strongest action that the White House has taken under Biden since 2021, when Ortega won a controversial presidential election. In that election, all of his male opponents were either barred from running or sitting in jail.
And President Biden called that election a pantomime at the time. It was (INAUDIBLE) instead the government of Ortega is targeting members of the Catholic Church, widely regarded as the only alternative to that of the government in Nicaragua.
The relationship between the United States and Nicaragua has soured even further this year, as Nicaragua has become a vocal supporter of the Russian invasion of Ukraine.
On October 12th, Nicaragua is one of only five countries and the only one in the Americas to vote against a U.N. resolution condemning the annexation of parts of the Ukrainian territory into the Russian federation.
For CNN, this is Stefano Pozzebon, Bogota.
(END VIDEOTAPE) HARRAK: Still to come, NASA begins a new search for answers. How they hope to uncover the secrets of UFOs, when we return.
(COMMERCIAL BREAK)
HARRAK: The legal team for a U.S. basketball star jailed in Russia says she is not expecting miracles as she appeals her case. A court is expected to hear Brittney Griner's challenge against her nine-year prison sentence over the coming hours. She was arrested at a Moscow airport in February and accused of having cannabis oil in her luggage.
Meanwhile, the U.S. State Department is signaling they're making progress in freeing Griner and U.S. Marine veteran Paul Whelan, who is also been imprisoned by Russia.
(BEGIN VIDEO CLIP)
NED PRICE, U.S. STATE DEPARTMENT SPOKESPERSON: I can say there have been active discussions, including in recent days, but our imperative is to see Paul Whelan and Brittney Griner returned home. We are not going to do anything, or say anything publicly that could impair that ability.
(END VIDEO CLIP)
HARRAK: Bill Richardson is a former U.S. ambassador to the U.N., and following a trip to Moscow last month, he says he believes both Griner and Whelan could be released by the end of the year.
Now four people have been arrested in London after a wax figure of King Charles was defaced. At least two protesters smeared chocolate cake on the wax work at Madame Tussaud's on Monday. They were demanding that the government stop granting permission for fossil fuel use. They were not the first time protesters to target a museum with food.
[01:54:53]
HARRAK: In (INAUDIBLE) Germany, on Sunday demonstrators covered Monet's haystack painting with mashed potatoes, before gluing themselves to the wall. And earlier this month tomato soup was thrown at a Van Gogh painting in London.
Now you may call them UFOs, or flying saucers, but the U.S. government calls them unidentified aerial phenomena. And now NASA is gathering a team of experts for a new study on the mysterious objects. They will start their investigation on Monday, and they'll attempt to piece together what we already know to see if the truth really is out there.
CNN's Kristen Fisher filed this report.
(BEGIN VIDEOTAPE)
KRISTEN FISHER, CNN SPACE AND DEFENSE CORRESPONDENT: NASA has assembled a team of 16 people to take part in its independent study on unidentified aerial phenomena, or UAPs, or UFOs as it's more commonly called. This is a study that was announced back in June and these 16 people are going to spend the next nine months or so really going over all of the data, the unclassified data on UAPs.
And they are also going to be looking at ways to better catalog and identify and track all of these ports that have been pouring in. Not just from the military, but from civilians and commercial entities as well.
So that is sort of their scope, that is what they are looking at. Again, they are not touching any of the classified stuff. They are saving that for the Pentagon and for Congress, which of course last summer held the first hearing on UFOs in more than half a century.
That really was part of the reason that UFOs and UAPs have been thrust back into the spotlight over recent months. That combined with the fact that the office of the Director of National Intelligence released that report in the summer of 2021, saying that they have studied more than 140 instances of UAPs, but they could explain only one of them. Really just fueling this mystery even more.
So now, these 16 people involved in the NASA study are going to lend their expertise to the effort, and these are people like astronomers, astrophysicists, biologists, oceanographers. There is one journalist, and there is also a very famous former NASA astronaut, Scott Kelly, who famously spent a year in space.
They're going to be studying this for about nine months, and hopefully they will be able to produce a report that will be released to the public sometime in mid 2023.
Kristen Fisher, CNN -- Washington.
(END VIDEOTAPE)
HARRAK: Thanks so much for watching CNN NEWSROOM. I'm Laila Harrak. The news continues with Rosemary Church right after this.
[01:57:46]
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