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Fed Chair Signals More Interest Rate Hikes; Terrifying Incident in the Skies; Two Americans Killed in Mexico. Aired 1-1:30p ET

Aired March 07, 2023 - 13:00   ET

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

[13:00:05]

JOHN KING, CNN HOST: Quick update now on the two surviving Americans who were kidnapped in Mexico, a source telling CNN the two victims are now back in the United States in the care of the FBI.

Thanks for your time today on INSIDE POLITICS. We will see you tomorrow.

Abby Phillip picks up our coverage right now.

ABBY PHILLIP, CNN HOST: Hello, and thank you for joining us. I'm Abby Phillip in Washington.

A frantic search for four Americans kidnapped in Mexico and in a tragedy. Just a short time ago, all four were found, but two were dead. Authorities have not identified the victims. But we do know that a mother of six from South Carolina crossed the border from Texas with three of her friends for a medical procedure.

But investigators believe that, once they were in the city of Matamoros, the group was mistakenly kidnapped by Mexican cartel members. We have disturbing footage of this incident. You can see here it shows the terrifying moments Friday when at least one of those Americans was shoved into the bed of a pickup truck at gunpoint in broad daylight, and not far from the United States border.

Our correspondents are covering this from all angles.

Josh Campbell, you are getting information from your law enforcement sources about the condition of the victims and where exactly they were found.

JOSH CAMPBELL, CNN SECURITY CORRESPONDENT: Yes, Abby.

I have been talking to sources since this incident began on Friday. And to a person, they said, look, we're holding out hope that we will find these four. But the situation was very grim. And it's because of that video that you just showed. This was the dramatic aftermath of that incident, where you see a woman being shoved into the back of that truck in this graphic video.

There are other people around that truck who don't appear to be moving. They were lifted on that vehicle as they drove away. And so because those people weren't moving, that obviously gave law enforcement great concern. We are learning today from a U.S. official familiar with this investigation that all four have been recovered, but, sadly, two of them are deceased.

Now, the other two -- among the two that are alive, one of them, the source says, is severely injured. Now, we just learned a short time ago from a source that the two surviving victims are now in the care of FBI agents. They have crossed the port of entry back into the United States, where they will be receiving medical attention and medical care at a hospital there in Texas.

And, of course, the FBI is still working this investigation to try to determine who was responsible. So those two surviving victims would be key to interview, to gather as much information as they can.

Now, I'm told as far as the two deceased American victims, they will be processed, their remains, by the medical examiner's office there in Mexico to determine the cause of death. And then, after that is complete, a source tells me that they expect the remains to be promptly handed over to U.S. officials, where they will then be repatriated back to the United States.

But, of course, just a tragic end to this, with two of them killed, one severely injured. As I mentioned, one of them is still alive. This, of course, happened Friday after this group was traveling in New Mexico for what a source says was to seek a medical treatment, some type of medical procedure, which, of course, Americans and Canadians do all the time, travel into Mexico for lower-cost prescription drugs, for low-price medical care.

But, of course, this is a part of Mexico where the U.S. State Department has this travel warning citizens not to go there, this obviously ending in tragedy. And, finally, I will point out one source says that they appear -- that it appears, at least according to law enforcement, that these Americans were targeted by mistake, that it was a Gulf cartel group that thought that these Americans were part of some Haitian drug smuggling outfit, but targeting these Americans by mistake, leading to this extremely, extremely tragic event -- Abby.

PHILLIP: Yes, I mean, incredibly tragic, and some indications in the reporting coming out that perhaps they were lost trying to get to that doctor's office.

Dianne Gallagher, you're in South Carolina, where I know you have been speaking to the family members of some of these individuals.

Authorities have been pretty tight-lipped about their identities. But what are you learning and what has been the reaction, if you have gotten any so far, from those family members about what has happened here?

DIANNE GALLAGHER, CNN NATIONAL CORRESPONDENT: Abby, what Josh said there, I think it's important to remember these were four friends who took a road trip to support their friend who was, according to her mother and her friends, going for a medical procedure there in Matamoros, something that she had done about two to three years ago as well in that same city. Three of those four friends, they are in Lake City, South Carolina.

They were a very tight-knit group, we're told. And, look, it became clear to friends and family that something was wrong as early as Saturday. We spoke to a close friend of -- excuse me -- of LaTavia "Tay" Washington McGee. She was going to get that procedure.

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And she talked to her friend on Friday and told them that basically they got lost. They were reaching out to the doctor's office for directions, but they were struggling to communicate because of spotty cell phone signal. That's what she told her friend.

The friend says she became concerned and actually reached out to the doctor's office on Saturday, when they hadn't heard from their friends. We spoke with McGee's mother as well, who said that she was also concerned. Family members and friends had been calling. They were just getting voice-mails and not being able to get a hold of these four.

And the doctor was concerned that they had missed the appointment. Now, the friend says that, when they reached out to the doctor's office, the doctor's office did say that LaTavia had reached out to them to ask for directions because she was lost.

They actually sent a screenshot of the message and they sent her the address and asked her if she was using GPS. They said that the office employee that she spoke with message the doctor's office, said that she had messaged her doctor's office, but the employee did not notice the message until a few hours later.

I will tell you, Abby, that the aunt of LaTavia McGee said that on Sunday, after the FBI had contacted her mother, saying that she -- that she had been kidnapped and that she was in danger, her aunt saw a video online where she recognized her niece in that because of her hair and the clothes she was wearing, because, again, these are friends. They were FaceTiming. They were livestreaming their trip from South Carolina down to Mexico.

She recognized what she was wearing and knew that she was there. Again, they could not get in touch with any of them. And this ended in a way that absolutely nobody wanted to see happen. There was so much hope from family members just last night speaking about no good news is good news, and that they were holding out hope that perhaps this would have ended differently.

LaTavia McGee, Abby, is a mother of six children and her family just waiting to get word on how this is shaking out for those kids.

PHILLIP: Yes.

Kylie Atwood, the State Department -- there have been travel warnings for this part of Mexico for some time. What are you hearing from the administration today about what is next?

KYLIE ATWOOD, CNN NATIONAL SECURITY CORRESPONDENT: Well, listen, we heard from the White House national security advisers, John Kirby expressing condolences to the families of those who were killed in this incident, not getting into the specifics of the circumstances surrounding that yet.

He said that the Biden administration, U.S. officials are still working with Mexican authorities to learn more about really what happened here. And what they're focused on, of course, is trying to get home the bodies of all four Americans. Of course, as of now, we know that two of them will be dead and two alive, but trying to get all four of them back to the United States.

The other thing that John Kirby told reporters is that the Biden administration is working to make sure that justice is served. And what that, of course, will involve is not just the State Department, but also the Department of Justice. And we heard from the attorney general earlier today, saying that he has been briefed with the FBI on this, and that the Justice Department is working closely with the State Department on this matter.

And the next step for State Department officials will be notifying the families of these four Americans about their status, if they in fact, awfully, died in this instance, or if they're still alive, and what the next steps are in terms of getting them back to the United States.

And then we're likely to hear more from the State Department. But, Abby, it's also important to note that it wasn't just the State Department that had very clear warnings to Americans to not travel to this area of Mexico because of the criminal activity, because of the violence there, because of the kidnappings in the murders, but it's also the CDC that had warned Americans against going there for exactly what this woman from South Carolina was there for, which is these medical procedures, warning that there can be complications that arise from these procedures that are carried out in this area of Mexico.

PHILLIP: Yes, this is clearly a growing problem, not just in Mexico, but other parts of the world as well.

Josh Campbell, Dianne Gallagher and Kylie Atwood, thank you to all of you.

And let's now bring in a former member of the FBI's hostage rescue team, Rob D'Amico.

Rob, good to have you here.

I want to focus in on one of the things that Josh was talking about. In that video, you see a woman walking around at gunpoint, but you also see some evidence that there were perhaps people who were not moving. Two dead, two alive, one critically injured. What do you think, based on what we know so far, happened here?

Did the hostage takers go further than what happened in those initial moments, perhaps killing or injuring the victims after what we see transpiring on this tape?

ROB D'AMICO, FORMER FBI HOSTAGE RESCUE TEAM MEMBER: Yes, Abby, it was a horrific video.

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I saw the uncut version yesterday early, when our intel analysts sent it to me. And it reminded me back of Iraq and Afghanistan, the freedom of movement that the bad guys were doing. I believe that they were probably injured in the shoot-out in the car. And I don't think later on anything else happened.

Looking at that video -- I have seen enough of them from over there -- I I'm actually surprised three -- or two are alive, because the way they're dragging the bodies and everything else that was coming out from it, I was assuming the worst. I knew the woman who was put the car looked unharmed. But the other three, I was truly worried about. And I said that, hey, the cartel have doctors. They need to get in there so that we can start dealing with this.

But I had the worst feeling, but just seeing those images from later days in Iraq and Afghanistan, the way they were treated.

PHILLIP: We don't know much about what happened there in terms of how they were recovered. We only know that they were found.

The FBI is collaborating with Mexican officials. How do you think they were able to identify where these people were and get them back?

And I should say, from what we know, so far, the two Americans who are alive are back in American custody, but the two bodies of the deceased, they will have to be recovered by their family members.

D'AMICO: Well, yes, ma'am.

It's almost standard that they're going to process the dead within the country that they're killed, because their justice system may be the one that we use. So there's probably FBI or State Department people with those deceased, because, again, we want them in our care, even though they're in Mexican custody. We did this in Afghanistan and Iraq. We process them with the home country. We make sure that they're treated dignified.

But we do let the home country do that. The ones that have come back, the FBI's victim assistance are unbelievable. They have a lot of experience. These people have gone through traumatic things. One, you want to get the injured to the right level care down in Texas, get that -- get him or her into the hospital.

And then, the other one, that we do have a case, but again, the mental health of these people is the most important thing. So the agents are with them. Some of the victims like this want to tell the story. Some wait a little bit. And our agents are used to that. But we will have psychologists come down and help with those interviews.

But the process is long. We have arrested people 20, 25 years after they have killed Americans around the world. I have been on those ops, and they're -- as bad as they are, it is justice served after a long time. PHILLIP: Just bottom line here, I mean, would you recommend that

Americans travel to Mexico right now, particularly this part of the country?

D'AMICO: No.

People have to really pay attention to the warnings out there. Level 4 from the State Department is a drastic warning. And you really have to start looking. I think part of it, she went down there a couple years ago and had a procedure. So she I think felt like, hey, we have done this before, we will go down and do this.

But things get worse. And, again, the cartels have been warring and other things are coming up. You really have to pay attention to where you're traveling, especially down there. I have four children. And I wouldn't recommend them, even though I think Mexico is going to go over the edge on showing the authority in the streets and everything else.

And I think that's how we probably ended up getting them back. I think the cartels realized this was a mistake. There was so much heat from the Mexican government. They decided to get them out of their own hands because they just realized it's going to bring more heat down on what they're doing.

PHILLIP: All right, Rob D'Amico, thank you very much for all of that.

And another terrifying incident in the skies, this time on a United Airlines flight from Los Angeles to Boston.

(BEGIN VIDEO CLIP)

FRANCISCO TORRES, PASSENGER: I'm taking over this plane!

UNIDENTIFIED FEMALE: Uh-oh.

UNIDENTIFIED MALE: I'm telling you right now...

(END VIDEO CLIP)

PHILLIP: The Justice Department says that this man tried to open an emergency exit door and then tried to stab a flight attendant in the neck with a broken metal spoon.

Listen to a passenger who captured it all on her cell phone.

(BEGIN VIDEO CLIP)

LISA OLSEN, PASSENGER: A couple of passengers tried to talk to him, to calm him down. It was only making him more agitated.

A woman tried to approach him and say that he was scaring the passengers. He didn't care. He was getting louder. Many men from the plane jumped up, followed him, tackled him to the ground. And there were probably about four to six of them that sat on top of him to restrain him. The flight crew immediately had zip ties to zip-tie his feet and his arms.

(END VIDEO CLIP)

PHILLIP: CNN's aviation correspondent, Pete Muntean, has more details on this very scary incident.

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(BEGIN VIDEOTAPE)

PETE MUNTEAN, CNN AVIATION CORRESPONDENT (voice-over): United Airlines Flight 2609 from Los Angeles to Boston, it was a smooth flight for the first five hours on Sunday, until...

TORRES: So, where's the Homeland Security with the guns, because I'm waiting for them to point the gun at me, so I can show everybody that I will die when I take every bullet in that clip to wherever in my body they shot it, and then I will kill every man on this plane!

MUNTEAN: The agitated passenger is identified as Francisco Severo Torres of Massachusetts.

The video obtained by CNN was recorded by a passenger. It shows Torres having violent outbursts towards other passengers and flight attendants.

TORRES: (INAUDIBLE) I'm coming for you. (INAUDIBLE)

MUNTEAN: For minutes, nervous passengers sat down and listened.

TORRES: Nobody cares. Nobody cares. Where is Homeland Security?

There should be Homeland Security. (INAUDIBLE) averting us, because, wherever it is, it's going to be a bloodbath everywhere.

MUNTEAN: Fifteen seconds later, Torres walks out of his seat, pulls what appears to be a makeshift weapon out of his jacket pocket and said what no airline passenger ever wants to hear.

TORRES: I'm taking over this plane!

UNIDENTIFIED FEMALE: Uh-oh.

UNIDENTIFIED MALE: I'm telling you right now...

MUNTEAN: While United Airlines says there were no reported injuries, the Justice Department says Torres rushed towards one of the flight attendants in a stabbing motion with a broken metal spoon, hitting the flight attendant on the neck area three times.

Torres also told law enforcement that he tried to open the emergency door to jump out of the plane. Torres also claimed he was defending himself because he believed the flight crew was trying to kill him.

Video shows passengers and crew members tackling and restraining Torres. A passenger told CNN Torres remained restrained for another 30 minutes before the plane landed safely at Boston Logan International Airport, where Torres was arrested.

(on camera): This is the second high-profile case of an unruly passenger on board a commercial airliner in as many weeks. Torres has been banned from flying on United Airlines again. He's being detained pending a hearing before a judge on Thursday -- Abby.

(END VIDEOTAPE)

PHILLIP: All right, Pete Muntean, thank you for that.

And now we have former FAA safety inspector David Soucie joining us now.

David, there's a lot to talk to you about in the skies. But let's start with this incident on that flight. You have for so many years in this country a lot of concern about perhaps terroristic incidents happening on planes. But in the COVID era, it's actually been a lot of disruptive passengers, perhaps disturbed passengers.

When you see it here, what happened there, do you think that was handled the way that it should have been?

DAVID SOUCIE, CNN SAFETY ANALYST: Actually, I think it's a really good sign of what should be in what was tried to be handled, at least, with an unruly passenger.

So you can see that they tried to calm him down at first. They tried to get him calm. It's just not going to happen. And then he continues to yell. He was not truly a threat to the crew until he left his seat. At that point, it's -- it really says a lot about the passengers that helped subdue him, because there's only a couple of flight attendants, maybe three flight attendants, and trying to get them down to control this person would have been impossible.

So, as a passenger, the passengers stepped up to this. I think that was really a smart thing for them to do.

PHILLIP: And there have been a host of other issues in the skies recently. We have been talking a lot about the travel disruptions, whether it's a bird strike, or severe turbulence or issues with planes on the tarmac.

But, particularly with planes on the tarmac, this is a place where there are questions about who's responsible and what can be done to fix it. You have said the only way to prevent these types of incidents is to slow this system down. Who is going to actually make that happen?

SOUCIE: Well, the FAA has to step forward and start setting some guidelines.

Currently, the FAA sets the minimum standards. So what they're saying is, if you have -- show them the numbers, and you can show safety in this amount of departures in a certain amount of time, then that's what they allow you to do. But the onus of responsibility really comes down to the airlines to

say, when do we say enough is enough? Can we pack so much in tight that we start making mistakes? And I think that is one of the root causes for why we're seeing more and more of this right now, is that these -- they're under a lot of pressure to try to get more airplanes and make up for those losses that they had during the COVID era.

And so they're really pushing things forward. I think, again, they need to step back and look at how long does it really take to move these airplanes? Do they have all the people necessary? Were they fully staffed to do it and be able to say no when it's time to make that airplane leave and say we're at our capacity, we have had delays and we're going to just accept what we have now, and just slow things down a little bit.

PHILLIP: Yes, I mean, obviously there's a lot of airline demand and some staffing issues.

But safety clearly has to come first here for passengers throughout the system.

David Soucie, we have to leave it at that, but thank you very much for all of your insight into that.

[13:20:05]

SOUCIE: Of course.

PHILLIP: And the Fed chief, Jerome Powell, today delivering a new warning on inflation and the debt ceiling. Wall Street, though, is not taking it well. But it has major implications for all of us. Details ahead.

Plus, China is amping up the tensions with the United States, warning of a possible confrontation. What the U.S. is saying about all of that.

And Florida Governor Ron DeSantis is giving a big state of the state address today, and he is not backing away from the culture wars.

Stick with us.

(COMMERCIAL BREAK)

PHILLIP: Higher interest rates are on the horizon and Wall Street is, as you can see, not too thrilled about it.

In testimony before the Senate committee a short time ago, Federal Reserve Chairman Jerome Powell warned that there will be more rate hikes ahead. The Fed is still trying to cool inflation without sending the economy into a recession.

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(BEGIN VIDEO CLIP) JEROME POWELL, FEDERAL RESERVE CHAIRMAN: The latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated.

If the totality of the data were to indicate that faster tightening is warranted, we'd be prepared to increase the pace of rate hikes.

(END VIDEO CLIP)

PHILLIP: All right, CNN's Matt Egan is joining us on all of this.

So, Matt, I mean, let's start at, first of all, for consumers, rate hikes sounds like a really bad thing. But it seems to also just be the medicine that the Fed thinks that the economy needs right now.

MATT EGAN, CNN REPORTER: That's right, Abby.

We're talking about tough medicine. And it can be painful for both Wall Street and for Main Street. Let's talk about what it means for consumers. We're talking about higher borrowing costs. As the Fed raises interest rates, it gets more expensive to borrow. Mortgage rates are quickly approaching 7 percent again.

Credit card rates have never been higher, also more expensive to buy a car, student debt as well. Why the Fed chair is concerned, it's really about inflation. This is the Fed's preferred inflation metric. I think this chart shows two things. One, inflation has cooled off from the peak last summer. But also, more recently, it has picked up in January. And so that has been concerning to the Fed chair.

That's why he's signaling more rate hikes ahead. Now, as you mentioned, this is not sitting well with investors. Markets are starting to price in a greater chance of higher interest rates, including, Abby, perhaps a another 50-basis-point interest rate hike later this month.

PHILLIP: And there is another issue that could upend all of this. And that's the debt ceiling debate.

What did Powell have to say about that?

EGAN: Yes, Powell clearly doesn't want to get into politics. But he did send a clear message to lawmakers that they really can't mess around with the debt ceiling. Listen to what he said.

(BEGIN VIDEO CLIP)

POWELL: And Congress really needs to raise the debt ceiling. That's the only -- only way out in a timely way that allows us to pay all of our bills when and as due.

And if we fail to do so, I think that the consequences are hard to estimate, but they could be extraordinarily averse -- adverse and could do longstanding harm.

(END VIDEO CLIP)

EGAN: So what kind of harm are we talking about?

Well, potentially a credit ratings downgrade, which would be very expensive, market mayhem that would shrink all of our nest eggs and even mass layoffs. Moody's Analytics put out a new report today saying that even a brief breach of the debt limit could wipe out almost a million jobs and cause a mild recession.

And that is just a brief breach of the debt limit. I think that Moody's economist Mark Zandi summed it up best. He said, a default would be a catastrophic blow to the already fragile economy.

Now, Abby, hopefully, we don't get anywhere near there. Hopefully, Congress addresses this issue before it actually does real harm to the economy.

PHILLIP: Yes, it's never a good time to default on your debt, but certainly not at a moment where everyone is anticipating some kind of economic recession down the pike.

Matt Egan, thanks for breaking all of that down for us.

And up next for us: The former Chinese ambassador to the U.S. is now China's foreign minister. And in his first news conference on the job, he had some strong words of warning for the United States. We will tell you what he said and what it could all mean.

(COMMERCIAL BREAK)

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