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Elaine Chao is Interviewed about Airline Problems; Byron Brown is Interviewed about Buffalo; New Weekly Jobless Claims. Aired 8:30-9a ET

Aired December 29, 2022 - 08:30   ET

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

[08:30:00]

ELAINE CHAO, FORMER TRANSPORTATION SECRETARY: What a nightmare. What a complete mess. And they, obviously, would wish that this would never have happened, as everyone would. And we've got passengers now who had their holidays' ruined. They're still stranded out there. They can't find their luggage. I mean it is a complete nightmare. It's a perfect storm of all the things that have been going on with the company.

But the saddest thing is, this company used to be a paragon in the airline industry. They had the best computer reservation system. They were trying to set up a personal relationship with the passenger, bypassing all these other intermediary reservation sites. They used to have best labor relations with their pilots and their flight attendants. And it was known as a -- you know, as a really kind of a cool, really kind of with it airline that had great labor relations.

And all of this now has been put into question. And I know that the company itself must be so concerned about reviewing its own operations. And I'm not talking about even external operations. But they themselves know that they've got to do a deep dive into their own operations to see whether the point to point destination business model is good and whether - what, you know, whether they need -- how much faster -- what do they need to do to shore up and - you know, revamp their whole computer crew assignment system.

So, they know that they've got a lot of work to do to bring back and to build back the loyalty and the trust that they used to have with the traveling public. And I think this is going to go on for - for a long time.

Now, the thing that's also - that also needs to be pointed out, this is a new management team. This is a new leadership team. And the current CEO came on board with the rest basically about February of this year. Even though they've been veterans of the company for a long time, you know, it's different when you're in the top seat and the whole new management team is different.

And, secondly, they've got labor negotiations going on as well with certain swaths of their work force. So that also, you are seeing played out in some of the comments that are being discussed.

KAITLAN COLLINS, CNN ANCHOR: Yes, quite a learning experience. CHAO: But having said all of that, they've - yes, they've got a lot of rebuilding to do. Ad they're going to be under the scrutiny of regulators, of the administration. I mean they've got a lot on their plate. But most important, their immediate goal should be that they've got to do something to, you know, to help those who are still stranded.

COLLINS: Well, I want to -

CHAO: And one of the things that they need to do very -- yes.

COLLINS: We're seeing an apology from them.

CHAO: They need to get those reimbursement - they need to get those reimbursements like processed and repaid quickly. If they don't do that quickly, that's another burden and another barrier that they're going to have to face in rebuilding that trust.

COLLINS: Which is something we've heard from a lot of passengers that our correspondents have been speaking with.

CHAO: Yes.

COLLINS: I want to get to the apology from Southwest in a moment, the latest one, but when you say that point to point reference there, I just want to be clear for those watching, they - Southwest has this point to point system where they don't return their planes to major hubs, like you see other airlines do where the planes go back to a central hub once their route is done.

CHAO: Yes.

COLLINS: Is that something you think Southwest needs to change to fix this?

CHAO: It's up to them. But basically that has been a great system for them. That has enabled them to be nimble, to be quick, to be more efficient. But in light of what's happened, I think they've got to look at everything. And I'm sure they are because this has been a failing of just unbelievable dimensions. And it's still occurring.

They may extend cancellations beyond Thursday. Beyond today. There are still passengers who are stranded, who are not reunited with luggage, who have been living, you know, for -- in the same clothing for last four or five days. I mean that is their first priority. That's got to be their first priority.

COLLINS: And -

CHAO: And I'm sure it is. It's just not that simple.

COLLINS: On the baggage front, I -- this really struck me from this latest apology that we're getting from another Southwest executive.

CHAO: Yes.

COLLINS: I want you to listen to what Ryan Green said this morning.

(BEGIN VIDEO CLIP)

RYAN GREEN, CHIEF COMMERCIAL OFFICER, SOUTHWEST AIRLINES: If you're still waiting on a bag, you can submit information on how to retrieve -- receive that bag at no cost to you. You could submit a full refund request for any canceled flights. And if you have any travel expenses due to the disruption, you can submit those receipts directly on our website.

(END VIDEO CLIP)

COLLINS: Do you think that's sufficient to say you can get your bag back at no cost to you?

CHAO: I think it's the minimum of what they should be doing. But clearly they need to be reunited passengers with their luggage because with the problem, as we all know is, they knew where the -- they knew where the - where the airlines were. They sometimes knew where the crews were but they just could not, you know, combine the two and to match then up. And that's a real problem. And now with like so many luggage's strewn around airports throughout the country, it's a massive undertaking for them.

[08:35:05]

So, if I were a passenger for Southwest Airlines, first of all, I would keep track of all of your expenses, keep track of the - you know, of the flight situation, keep on top of how Southwest Airlines is responding to all of this. But I would also, if at all possible, look at other alternatives as well. There are other airlines -- and I hate to say that, but there are other airlines who have capped their fares and -

COLLINS: Yes.

CHAO: But, at this point, even though -- if you're able to kind of stay put for a while, do so. But if you have to go someplace, I think it's -- it's time to look for some other alternatives, unfortunately.

But I think going forward, there's a lot that Southwest Airlines has to do. And they know that.

COLLINS: Yes. And we'll be watching it very closely.

CHAO: Yes.

COLLINS: I'm really glad you're joining us this morning and I want to ask you about something that happened overnight with your former boss, who, as we noted, you were the transportation secretary under Trump. You were there nearly the entire time that he was in office.

CHAO: Yes.

COLLINS: And overnight, on his social media website, he revived a racist nickname that he has used for you. And you're probably one of the most reliable members of his cabinet. Certainly, one of the longest serving. I want to give you a chance to respond to this racist nickname that your former boss is using about you.

CHAO: Well, I think it's very helpful if the media does not repeating that racist tweet. I mean if it were the "n" word or any other word, the media would not repeat it. But the media continuously repeats his racist taunt. And so he's trying to get a rise out of us. He says all sorts of outrageous things. And I don't make a point of answering any of one of them.

COLLINS: And I made a point of not saying it there. I just wanted to give you a chance to respond to that.

CHAO: Thank you.

COLLINS: And also, you know, as you -- since the last time you joined us, the January 6th report has come out. You sat down with the committee, I know, to testify.

CHAO: Yes.

COLLINS: They just released your transcript in recent days. Their report culminated with saying that they believed, the committee members, none of the events of that day would have happened without him, meaning the former president. You resigned in the days after that. You referenced it in your resignation letter.

Do you agree with that sentiment?

CHAO: I was the first one in the cabinet - I was the first one to - yes, I was the first one in the cabinet to do so.

COLLINS: Yes, and what - so what did you make of the report?

CHAO: And I also said in my testimony - well, I gave my testimony, you know, as requested. And I had said in answer to a question that I wished the former president had acted differently.

COLLINS: Is there anything you'd like to say about the takeaways from the report? That what happened that day wouldn't have gone down if the former president had not done what he did?

CHAO: Well, I said what I said. I wish that the former president has acted differently.

COLLINS: All right, Secretary Elaine Chao, thank you for joining us this morning on the important Southwest issues and also weighing in on the recent events.

CHAO: Thank you.

COLLINS: We appreciate your time.

CHAO: Thank you.

POPPY HARLOW, CNN ANCHOR: That was such a powerful and eye-opening interview on Southwest -

COLLINS: Yes.

HARLOW: And on her responses to the former president.

COLLINS: Yes, well, and, Southwest, she has a lot of perspective. I mean she was the transportation secretary for so long.

HARLOW: Yes.

COLLINS: You see the role that Pete Buttigieg is playing in that now. But also the relationship that former cabinet secretaries who served under Trump, you know, she was there almost all four years.

HARLOW: Yes.

COLLINS: She is right that she was the first cabinet member to resign over what happened on January 6th.

HARLOW: Yes.

COLLINS: But, very important.

HARLOW: Great interview. Glad we could hear from her.

All right, next we're going to take you to Buffalo. The death toll, sadly, has risen again this morning after the devastating blizzard. The mayor of Buffalo is being criticized for the recovery.

Listen to this.

(BEGIN VIDEO CLIP)

MARK POLONCARZ, ERIE COUNTY COMMISSIONER: The mayor's not going to be happy to hear about it, but storm after storm after storm after storm, the city, unfortunately, is the last one to be opened, and that shouldn't be the case. It's embarrassing to tell you the truth.

(END VIDEO CLIP)

HARLOW: Byron Brown -- the mayor of Buffalo, Byron Brown, will join us next to respond.

(COMMERCIAL BREAK)

[08:43:27]

HARLOW: Well, this morning, the driving ban has been lifted in Buffalo, reopening after that deadly blizzard that brought more than 50 inches of snow. The storm blamed for at least 37 deaths.

Our correspondent Miguel Marquez spoke with the daughter of one of those victims, Monique Alexander (ph).

(BEGIN VIDEO CLIP) CASEY MACCARONE, DAUGHTER OF BUFFALO STORM VICTIM: Her grandkids were waiting for her to come home. We were waiting for her to come home. I knew something was wrong right away, though. So, I kind of accepted it instantly. But it's hard knowing that she was outside for so long, too.

(END VIDEO CLIP)

HARLOW: And Monique Alexander was only 52 years old.

The mayor of Buffalo, Byron Brown, joins us now on the phone.

Mr. Mayor, thank you for joining us.

Let's begin with how your city is faring this morning and your level of concern about a real flooding risk because of the elevates temperatures coming.

MAYOR BYRON BROWN, BUFFALO, NEW YORK (via telephone): We continue to dig out and open up the city. Made a lot of progress. We have 100 percent pass through every street in the city of Buffalo. Our mains are 100 percent open. Our secondaries are each with one pass.

And as it warms up toward the end of the week, reaches 50 degrees, we expect that there will be some flooding. We've seen these patterns before after storms. At the height of the Blizzard, we went from minus 22 degrees below zero with the windchill.

[08:45:04]

And later this week, we're going to be at about 50 degrees. So, there, unfortunately, will be flooding.

HARLOW: Mayor, you have seen and heard the criticism of your office's handling of this storm. The Erie County Commissioner Mark Poloncarz said yesterday he's disappointed. He says your office has not been on these daily coordination calls with other municipalities about the respond. And then he said this.

Listen.

(BEGIN VIDEO CLIP)

MARK POLONCARZ, ERIE COUNTY COMMISSIONER: Just don't want to see this anymore. I'm sick of it. I'm a city resident myself. I live in the city of Buffalo. And it pains me to see the other 25 towns and two small cities opened in times when the city isn't.

And I know the mayor's probably not thrilled to hear it. I don't care anymore. I want it done.

(END VIDEO CLIP)

HARLOW: Mayor, are you satisfied with your personal and your office's response to this deadly storm since last Thursday? BROWN: I'm not going to pay attention to that. My focus is on the

people of Buffalo. My focus is on making sure that people have the medical emergency services that they need, making sure that every home that was without power has the power restored, and making sure that streets that were pummeled with snow and record wind gusts are open so that people can begin to resume their normal daily lives. That's - that's my focus. I'm not going to focus on the pressure that people feel in challenging situations. I'm going to focus on moving the city forward.

HARLOW: That's -- but, Mayor, that's not what he said. Why are you not going to focus on what not only one of your residents, but also the man who is the commissioner of the county said about what they are having to do, he said to step in where he believes your office has failed?

BROWN: Well, actually, he's the county executive. He's wrong. People have operated since Friday, working around the clock on little sleep. And I'm not going to focus on negativity. I'm going to focus on positivity and working together. That's what the residents demand of us. They don't want --

HARLOW: Except, Mayor - except, Mayor, we learn -- we learn from mistakes and failures and the county executive, Mark Poloncarz, has admitted his mistakes. For example, he's admitted that the travel ban should have been put in place sooner than just minutes before those 79 mile-an-hour winds came in.

So, my question to you is, how do you learn from this? Thirty-seven people - and that - that death toll may go up -- are dead this morning. Do you need to do things differently going forward for the next storm?

BROWN: You know what, it's horrific. Twenty-eight members of our community dead in the city of Buffalo. This is the third storm in Buffalo in less than two months. The second historic storm in less than two months. After every storm we do an evaluation. We did an evaluation after the last historic storm -- just less than two months ago -- and did things differently. We will continue to improve. We will continue to work to do better.

But hysterics from leaders is not what the public is looking for.

HARLOW: OK. Well, you talk about doing things differently after the November storm. Buffalo Common Council Member Rasheed Wyatt points to no changes they say being made. They're quoted in "The Washington Post" saying, quote, we have to learn some lessons from what happened. There are things we could have done better. You say you changed things since the November storm. What specifically did you change?

BROWN: Poppy, we did - we did a whole evaluation and plan after the November storm that was submitted to every member of the council that was --

HARLOW: What did it include? What was changed? BROWN: It included working with the state earlier. It included

bringing in private contractors to supplement the plows that the city had. It included requesting mutual aid earlier. All of those things were done in this storm.

Yesterday we had over 450 pieces of equipment, city, county, state, equipment from municipalities in the region, across the state, and even as far as New Jersey. This was a historic storm. Buffalo was ground zero for the storm. The impacts in the city of Buffalo were greater than anyplace else in the region.

HARLOW: Mayor, I do want to end with something amazing we've been seeing this week, and that is the response from many of the people in Buffalo.

[08:50:05]

Yesterday on this program we highlighted the work of two amazing women, Sha'Kyra Aughtry, who saved the life of a man named Joey White. She joined us along with Joey White's sister, Yvonne. And here's what she said about rescuing him literally from a snow bank.

Listen.

(BEGIN VIDEO CLIP)

SHA'KYRA AUGHTRY, HELPED SAVE MAN FROM BLIZZARD: We just immediately brought him in like family. I would do it 100 more times no matter what the situation was. I'm glad I was able to have power. I'm glad I had food. I'm glad I had heat. I'm just so thankful that I was able to give back and actually pay it forward.

(END VIDEO CLIP)

HARLOW: What is your reaction to these remarkable forces of good that we've also seen in the middle of this?

BROWN: She's absolutely amazing. So many of the people of Buffalo are like that. They go the extra mile. They look out for each other. People that have never met doing extraordinary things for their neighbors. That's why this community is known as the city of good neighbors. And there are literally hundreds of examples of people doing amazing things during this historic blizzard of 2022.

HARLOW: Mayor Byron Brown, we wish you and everyone there luck. Thank you very much for your time this morning.

BROWN: Thank you, Poppy.

HARLOW: Thank you.

COLLINS: The Labor Department has just released the new weekly jobless claims report. We're going to bring you those numbers next right after this.

(COMMERCIAL BREAK) [08:55:18]

COLLINS: Just in to CNN, the Labor Department has released fresh data on new jobless claims.

So, joining us to break it all down is CNN reporter Matt Egan.

Matt, what did we see in this report?

MATT EGAN, CNN REPORTER: Well, Kaitlan and Poppy, I'm here with more encouraging news because these numbers -

HARLOW: You're the good news guy.

EGAN: Lately.

These numbers show that this jobs market is historically strong. So jobless claims up by 9,000 to 225,000. That is exactly what was expected. It is also a historically low level. It's almost exactly where claims were a year ago long before these recession fears popped up. It's also well shy of the level that would be alarming to economists. And that's despite the fact that we have heard about a wave of layoffs, especially in tech and media, right, AMC Networks, Twitter, Door Dash, Amazon, Meta, all of them announcing big layoffs. The fact that claims are still low, though, it suggests that a lot of other companies, they are reluctant to let go of the workers they have right now, which makes sense. I mean, if I owned a business, I wouldn't want to let go of workers because there's a worker shortage right now.

HARLOW: OK. But the market, not a great end.

EGAN: No, not a great end to a really bad year. U.S. markets are on track for their worst year since 2008. The Nasdaq actually just closed yesterday at its lowest level since July 2020. And there's been some crazy losses of market value for some of the major companies that we know, Apple, Amazon, Alphabet, all of them down by more than $800 billion so far this year. That's how much market value they've lost. So, don't look at your 401(k)s, right, because you're not going to be happy with what you see.

HARLOW: I never do. I know I should. I don't.

EGAN: Well, you shouldn't look at it too much and you shouldn't react to it.

But, you know, we should remind people, the stock market, of course, is not the economy. But I do think that this is painful, though, right, for main street because a lot of us do have money in the market, whether it's the 401(k). I mean, I'm a parent. I'm saving money for my kids to go to college.

HARLOW: 529.

EGAN: Right. And this market drop this year just made it that much harder to save that money. So, it is concerning. And we're also in this weird place where good news is being treated as

bad news by the market, and bad news is being treated as bad news because good news is being seen as a sign that the Fed has to do more to cool off inflation. Bad news is not good because it's seen as a sign of a recession. So, hopefully markets bounce back early next year.

COLLINS: Yes, it will be fascinating to see what actually happens in 2023.

HARLOW: New year. Try again. New Year.

EGAN: Yes, we start with a fresh slate very soon.

COLLINS: Yes. Thank you, Matt.

HARLOW: Thank you, Matt.

EGAN: Thanks, guys.

HARLOW: Also, a programming note before we go. Anderson and Andy are back for another global celebration. Join them "New Year's Eve Live" from Times Square Saturday, 8:00 p.m. Eastern, right here on CNN. Don will join them hosting from New Orleans.

Thank you for being with us. We will be here tomorrow. Maybe in something sparkly.

COLLINS: Bring your resolution.

HARLOW: Oh, great. I will bring my resolution.

"NEWSROOM" is now. Thanks so much, guys.

(COMMERCIAL BREAK)

[09:00:00]