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Erin Burnett Outfront

Facebook Hit With Major Outage Amid Damning Allegations; Whistleblower To Testify, Says Facebook Could "Destroy Me"; Trump Iis Still Saying Election Was "Rigged," Calls AZ Audit That Found He Lost "Damning"; Trump Pick For AZ Gov. Would Not Have Certified Election Results; Biden Slams GOP for Refusing to Raise Debt Limit; Sen. Alex Padilla (D-CA) is Interviewed on Debt Limit Fight; "Pandora Papers" Reveal Financial Secrets of Rich and Famous; Facebook Hit with Major Outage Amid Damning Allegations. Aired 7-8p ET

Aired October 04, 2021 - 19:00   ET


WOLF BLITZER, CNN HOST: Erin Burnett OUTFRONT starts right now.

ERIN BURNETT, CNN HOST: OUTFRONT next, Facebook catastrophe. The world's largest social media company just coming back online after six hours off as Facebook is facing damning accusations of putting profit over all else. The lawyer of the whistleblower who uncovered all of this and now says the company could destroy her for speaking out is my guest tonight.

Plus, the clock is ticking. President Biden calling Republicans hypocritical and dangerous for abandoning Democrats in raising the debt ceiling. All as the nation faces the very real possibility of a first default in American history.

And Stephanie Grisham, a Trump insider selling books by warning of a 2024 Trump run that she's 'terrified' about. But is her book tour all about rehabbing her own image? Let's go OUTFRONT.

And good evening. I'm Erin Burnett.

OUTFRONT tonight, Facebook's disaster. Just hours before whistleblower is set to testify before Congress against the tech giant about its quest for profit over public safety, Facebook site is coming back online after it was down almost six hours today. And the other sites Facebook owns; Instagram and WhatsApp, also offline. It's one of the longest outages for Facebook which has 3 billion users and impacted the planet. Massive outage comes as we're learning damning new claims of the internet giant putting profit above all else.


FRANCES HAUGEN, FACEBOOK WHISTLEBLOWER: The thing I saw on Facebook over and over again was there were conflicts of interest between what was good for the public and what was good for Facebook. And Facebook over and over again chose to optimize for its own interests like making more money.

(END VIDEO CLIP) BURNETT: That was Frances Haugen, former Product Manager who is about

to tell all the Congress. And according to her prepared testimony, she will say and I quote, "Facebook's products harm children, stoke division, weaken our democracy and much more. The company's leadership knows ways to make Facebook and Instagram safer and won't make the necessary changes because they have put their immense profits before people."

She will also say that Facebook could 'destroy' her for speaking out, but that she believed that 'as long as Facebook is operating in the dark, it is accountable to no one.' Haugen says she has 10s of thousands of pages of internal documents to help prove her point. And since The Wall Street Journal has started reporting on those documents and they have had a trove of them and they started the series, you may have seen on the front page, started back on September 13th.

Well, since the Wall Street Journal started that, Facebook shares have plunged more than 13 percent. They've been plunging on this news and all of this could be just the tip of the iceberg because Haugen knows the significant influence Facebook has over its billions of users around the world.


SCOTT PELLEY, CBS NEWS 60 MINUTES HOST: Misinformation, angry content ...


PELLEY: ... is enticing to people and keep ...

HAUGEN: Very enticing.

PELLEY: ... keeps them on the platform.

HAUGEN: Yes. Facebook has realized that if they change the algorithm to be safer, people will spend less time on the site. They'll click on less ads. They'll make less money.


BURNETT: Haugen is also expected to be grilled on Facebook's role in fueling the lies and outrage leading up to the deadly insurrection. Her team which was reportedly charged with helping to protect the Democratic process that was actually the formal description and reducing, again, quoting, 'the spread of viral misinformation fake accounts' was dissolved last December. And then obviously the deadly insurrection came after that.

She told The Wall Street Journal that she was 'dismayed' when Facebook publicly played down its connection to the violence despite widespread internal concern that its platforms were enabling dangerous social movements. And, of course, we all now know that to be the case, the lies and conspiracy theories related to the election still running rampant on Facebook, our Donie O'Sullivan spoke to one Trump supporter and just listened to what she shares with her 3,000 Facebook friends. (BEGIN VIDEO CLIP)

MARY QUINTANILLA, TRUMP SUPPORTER: But the audit is showing that they are actually imitation ballot.

DONIE O'SULLIVAN, CNN REPORTER: But just with this video that she shared, right?


O'SULLIVAN: That the fact checkers are saying is false.


BURNETT: Mary is talking about the sham audits in Arizona and Georgia. For the record, there was no notable fraud in neither election. But Mary's 3,000 friends shared with their friends and on and on and that conspiracy theory went far and wide. With every press of the like button, Facebook got more information about each user who engaged in that conversation.

In fact, Facebook's algorithm knows more about you than you do. According to a study mentioned in the book Homo Deus by Yuval Noah Harari, after 10 likes Facebook knew more about the nearly 90,000 participants in the study than their colleagues at work. 70 likes Facebook could predict the participants' opinions better than their friends, 150 it knows you better than family members and after 300 likes, that's it, 300, Facebook knew study's participants better; their interests, what they wanted to do, what they believed better than their spouse.


Okay. Now that is power and, look, when you have that kind of power, you're not going to give it up. The social media company in a statement defends itself saying, "To suggest we encourage bad content and do nothing is just not true." Donie O'Sullivan is OUTFRONT on Capitol Hill to begin our coverage tonight. And Donie, Facebook just coming back online after a very troubling day for the company. I mean, six hours out was stunning on its own, never mind against the backdrop of this incredible moment.

O'SULLIVAN: That's right, Erin. And you talk about power, today was a reminder of Facebook's power. That platform, that company controlling three of the world's biggest social media platforms; Facebook, Instagram and WhatsApp. We're learning now that the services are slowly coming back online. This was very unusual, by the way. Facebook was out for almost six hours today, which basically never happens.

Why that all happened? We don't know yet. It sounds like the company is still trying to figure that out. But as one headache ends today for Facebook, a new one begins tomorrow here behind me in Capitol Hill when a whistleblower will testify about all of the company's ills about their corrosive impact on democracy and a key component of this whistleblower's allegations is about the negative effects that Instagram and Facebook can have on teenagers' mental health, have a listen.



HAUGEN: Imagine you know what's going on inside of Facebook and you know no one on the outside knows.


O'SULLIVAN(voice over): Meet Frances Haugen, a 37-year-old data scientist from Iowa. She left Facebook in May after working on the company's Civic Integrity team through last year's election. That team charged with helping to protect the Democratic process and reducing the spread of viral misinformation and fake accounts.


HAUGEN: They told us, "We're dissolving Civic Integrity." Like they basically said, "Oh, good, we made it through the election. There wasn't riots. We can get rid of Civic Integrity now." Fast forward a couple months, we got the insurrection. And when they got rid of Civic Integrity, it was the moment where I was like, "I don't trust that they're willing to actually invest what needs to be invested to keep Facebook from being dangerous."


O'SULLIVAN(voice over): A Facebook executive responded on Twitter Sunday night saying they didn't shut down the Civic Integrity team. Instead, he said they folded it into a wider team. Haugen walked out of Facebook with thousands of company documents, including the company's own research like this. A presentation about the dangers of Instagram for teenagers.

"We make body issues worse for one in three girls," reads one slide. "Teens who struggle with mental health say Instagram make it worse," reads another.


HAUGEN: And what's super tragic is Facebook's own research says as these young women begin to consume this eating disorder content, they get more and more depressed and actually makes them use the app more. And so they end up in this feedback cycle where they hate their bodies more and more.

Facebook's own research says it is not just that Instagram is dangerous for teenagers, that it harms teenagers, is that it is distinctly worse than other forms of social media.


O'SULLIVAN(voice over): "Eternally starved." "I have to be thin, skin and bone." All Instagram pages, the platform's algorithm suggests an account registered to a 13-year-old girl should follow. (BEGIN VIDEO CLIP)

SEN. RICHARD BLUMENTHAL (D-CT): What we did was to create a 13-year- old who expressed interest in weight loss and dieting. And within a day, she was flooded with recommendations for accounts concerning eating disorders and personal injury.


O'SULLIVAN(voice over): Instagram said, "Eternally starved." "I have to be thin, skin and bone." The accounts it had promoted through its algorithm broke the company's rules encouraging eating disorders, but they only remove the accounts after being contacted by CNN.


BLUMENTHAL: This experience shows very graphically how these claims to protect children or take down accounts that may be dangerous to them are absolute hogwash. In fact, it was not taken down until CNN brought it to their attention.


O'SULLIVAN(voice over): A spokesperson for Instagram's parent company, Facebook, said it uses technology and reports from users to remove content that violates its rules on eating disorders as quickly as it can, adding they are always working to improve.


O'SULLIVAN(off camera): And viewers affected by issues mentioned in that report can contact the National Eating Disorder Association helpline on 1800-931-2237. But just finally, Erin, just to underline what you saw on that report there, the Senator's office set up an Instagram account designed to look like it was a 13-year-old girl and Instagram began pushing pro-eating disorder accounts to this 13-year- old after the account search and followed a few accounts.


We're talking about anorexia and more glorifying eating disorders. But Instagram was feeding into that, Erin.

BURNETT: All right. Donie, thank you very much. It's so disturbing.

I want to go now to Andrew Bakaj. He is a lawyer representing Facebook whistleblower Frances Haugen. And he works with the legal nonprofit whistleblower aide. And look, I appreciate your time and there's so much to talk about here. First of all, can I just ask you, given what happens, now your clients speaking out, we know her name, she's going to testify, have you or your client heard directly from Facebook since she revealed her identity?

ANDREW BAKAJ, LAWYER, WHISTLEBLOWER AID; REPRESENTING FACEBOOK WHISTLEBLOWER FRANCES HAUGEN: To my knowledge, we have not heard directly from Facebook. Not yet. BURNETT: Wow. So I want to read part of a statement from Facebook in

response to Haugen's claims because I guess that's all we have since they haven't reached out to you. They say, "CBS 60 Minutes ran a segment that used select company materials to tell a misleading story about the research we do to improve our products. The segment also disregards the significant investments we make to keep people safe on our platform. We continue to make significant improvements to tackle the spread of misinformation harmful content. To suggest we encourage bad content and do nothing is just not true."

So when you hear that, Andrew, are you confident, is your client confident that she knows everything that Facebook is doing to keep the platform safe and that she hasn't missed anything significant?

BAKAJ: I think we're very confident. The truth of the matter is their own internal documents establish that they could have done more. I think a key important element of Frances' courage in making these disclosures to the SEC and Congress is that Facebook not only has done the research to identify the problems that have foster us here at home as well as abroad, that they know the mechanisms in which they can - the tools in which they can take to effect positive change, to mitigate against hate against viral misinformation.

Because one thing that I just want to point out is that Facebook is a vehicle by which misinformation spreads globally. It has impacted children here in the United States and it has impacted even individuals as far as Myanmar where there was a genocide that was influenced by Facebook.

BURNETT: So one specific Facebook claim, that one claim that they take issue with is the one about the Instagram impact on teen girls. You refer to children and I know you just heard obviously the report that talks about that. And the company says, "It's not accurate that leaked internal research demonstrates Instagram is 'toxic' for teen girls. The research actually demonstrated that many teens we heard from feel that using Instagram helps them when they are struggling with the kind of hard moments and issues teenagers have always faced. This research found teens report having both positive and negative experiences with social media."

How do you respond to that? I mean, I guess the broader point here is that they're not saying there is no bad. They are saying though that there can be great good.

BAKAJ: Well, my response would be that it is my understanding that they were looking to create an Instagram for teens. And after my client had made her disclosure, soon after it became public that they put a pause on that effort. So they presumably know that they have a problem. We all now know that what they know and when they knew it and now it's up to Congress and to regulators to determine how best to help Facebook fix itself and go back to its roots.

BURNETT: So Andrew, I want to ask you because I know the prepared testimony has come out tomorrow and obviously she's going to face a lot of questions, but Ms. Haugen will say she knows Facebook can 'destroy her'. That's the word she use that she came forward a great personal risk. Obviously, these are very significant things to say. Is she concerned about her physical safety? Has she been threatened?

BAKAJ: I would say this, we have one individual making a world of a difference because she had the courage to come forward and disclose what she believed to be wrong to federal government regulators and it's her against a trillion dollar company. So to say that she's intimidated, perhaps a little bit by a trillion dollar company is not an understatement.

BURNETT: All right. Well, Andrew, I appreciate your time. Thank you so much.

BAKAJ: Thank you.

BURNETT: Obviously tomorrow crucial day to hear Ms. Haugen's testimony.

I want to go now to David Axelrod, the former Senior Adviser to President Obama.

David, because you tweeted that these algorithms, and algorithm is not an equation, it's a method, it's a process that is used.


BURNETT: You say they're as dangerous to our democracy as any terrorist. Tell me why?

AXELROD: Well, I think we've seen that disinformation and conspiracy theories travel wildly on the internet, on social media and particularly on Facebook. Look, they are a very successful business. They're not a public trust, Erin, and their business relies on people clicking, and clicking, and clicking and staying online and they've found that hate sells, keeps people online. Conspiracy theories sell, keeps people online. Appeals to resentment sells, keeps people online and they've become the vehicle for radicalization.


And that is very, very dangerous. How does it happen that an oddball cult like QAnon now has millions and millions and millions of adherence and two members of Congress, two followers in Congress, how is it that up to 78 percent of Republicans in one poll now believe the big lie even though it's been disproved again, and again, and again. I'm not saying Facebook is responsible for all of that, but it is responsible for a lot of it.

BURNETT: Okay. And then, I mean, look, it's such an existential conversation. I mean, I mentioned the study earlier, 10 likes on Facebook and it knows more about you than the people you work with, 70 more than your friends, 150 more than your family members and all it takes is 300 and Facebook knows you better than your spouse.

And I mentioned it, David, because the algorithm has such power, because it knows us and we give it that power willingly because it enriches our lives in many ways, right?


BURNETT: And I guess the question is, Facebook could lose control of its algorithm, that's why I emphasize it's not an equation, it's a process. It gets a lot of information and data and it feeds into that. So saying a company puts profit above people that's not new, that's been a something lodged in various times at various companies. But what I wonder about here from when they say Congress needs to do something, maybe the biggest issue here is that I'm not sure really what can be done.

AXELROD: Yes. Look, throughout history, we've had private concerns that have ventures that in some way threaten the public interest and we take action, that's why we have regulatory agencies. There needs to be more transparency about these algorithms. People need to know why certain things jump on their newsfeed on Facebook and I think that regulators can do something about that.

There also is the question of whether antitrust action and breaking up the Facebook monopoly might be helpful if you have more wholesome competitors, together with transparency, who are rewarded by people for doing the right thing and not advancing hateful speech and conspiracy theories.

I think all of these things need to be explored. But Erin, there is a tremendous cost to this to us as a society, to us as a democracy, it's being gamed by malign forces around the world against us and we've seen it happen in Europe and elsewhere. We just can't be passive in the face of this.

I respect the fact that they're a private concern. But private concerns are often regulated when they cross into the public interest and I think we have to look at that here.

BURNETT: All right. David, thank you so much. I appreciate your insight. I always do.

AXELROD: Thank you too.

BURNETT: And next, Trump backing this woman for Arizona governor who says she would not have certified that state's election results. Was Trump setting the stage for another run?

Plus, ambush, activists upset with the war over Biden's agenda, chased Sen. Kyrsten Sinema into a bathroom. How did it come to something so low?


CROWD: Build back better, pass the bill. Build back better, pass the bill. Build back better, pass the bill.


BURNETT: And millions of confidential documents are exposing the hidden millions of the world's richest and those around them, including Putin's alleged mistress who is reportedly worth more than a hundred million dollars.



BURNETT: Tonight, former President Trump baselessly claiming he may have won the state of Arizona. It's a pretty stunning thing to do, because remember he Trumpeted the audit, his so-called audit that was led by his allies, kept saying it was going to show the whole thing that he wanted. And then, of course, the audit came out and actually said that Biden won Arizona by a wider margin than originally reported.


DONALD TRUMP, FORMER PRESIDENT OF THE UNITED STATES: This was an election that was rigged. If you look at the findings of that report done by the Senate, not done by me, it was done by the Senate of Arizona, those findings are damning.


BURNETT: Again, I remind you that his own audit showed that Biden won by a wider margin than the already formally audited results in Maricopa County, Arizona. This comes as Trump's pick for Arizona governor though says she would not have certified Biden's victory in 2020.


KARI LAKE, (R) CANDIDATE FOR ARIZONA GOVERNOR: Considering how much already at the time information we had about serious irregularities and problems with the election, I would not have certified it right then.


BURNETT: OUTFRONT now Laurence Tribe, Constitutional Law Professor at Harvard Law School. So Professor Tribe, she's saying that now after multiple audits, after the Republican committee in charge of the elections has repeatedly said from day one who won after Trump's own backed audit said that Biden won by a wider margin that had actually been reported in the State. She's coming out and saying that and Trump is backing her and she said she wouldn't have certified Biden's win. It's like Groundhog Day. He's now pressuring Texas Governor, Greg Abbott, to do an Arizona-style audit despite the conclusions of that Arizona 'audit'. So what does all this translate to for you?

LAURENCE TRIBE, HARVARD LAW PROFESSOR: It translates into a big lie, nonstop. I think until the end of time, some people are going to claim that he won when he lost. Asking for a further audit in Texas, which he won just shows that this guy is insatiable in his thirst for power and that's what's leaking out day by day as we learn more and more about the plot that he was engaged in.

He was working with this right-wing lawyer, John Eastman, to try to pressure the vice president, Mike Pence, into declaring, basically declaring him the winner. The plot thickens and the conspiracy is unfolding. We're learning about a meeting a few days before the insurrection with Pence's chief lawyer, Greg Jacobs, again, to try to bend Pence into the Trump fold. We were lucky that Pence resisted.


But the more we learn, the closer we discover that we were to a successful coup and he's not giving up, he's trying again in 2024. So we have to make sure that we are ready for whatever happens and it's not going to be pretty.

BURNETT: Well, you recently wrote an op-ed for The Boston Globe titled 'how to prevent the legal strategy that nearly undid the last election from ending democracy'. And you pointed out that this would happen again. This would happen again, if it wasn't stopped. And one way you said it could be stopped is for the Attorney General, Merrick Garland, to prosecute him for the federal crimes of inciting insurrection, seditious conspiracy.

That was what you wrote. Garland was just asked about that quote from you moments ago. I don't know if you even know this, because he literally just spoke out I wanted to play it for you, Professor, here is Merrick Garland.


MERRICK GARLAND, ATTORNEY GENERAL: We are doing everything we can to ensure that the perpetrators of January 6 are brought to justice. We will follow the facts and law wherever they lead. You're quite right, I'm not able to talk about any particular individuals or particular investigations. There's a long standing policy of the Justice Department. It's an element of the rule of law. It's very good reason why we follow that policy.


BURNETT: Okay. Does that give you more confidence or no?

TRIBE: Well, not very much. As I understand it, Jane Mayer specifically asked him what he thought of his former law professor, Laurence Tribe, suggesting that just prosecuting the foot soldiers and letting the generals go scot free was not going to do the job in terms of preventing the commander-in-chief, the former commander-in-chief from coming back and trying essentially to subvert democracy again.

Now, I fully understand that Merrick Garland like any other Attorney General, except for perhaps some of those like Bill Barr, who just completely went off the rails, he can't talk about specific prosecutions, I understand that. And I'm hoping there's more going on behind the scenes than we're aware of.

But at the moment, I'm not reassured yet that the Department of Justice is going full steam ahead to pursue justice in connection with the insurrection and the coup. And the reason that really matters isn't so much a matter of punishing the former president, it's a matter of preventing him from doing it again. You'll have no incentive to obey the law if he learns that he can be impeached and then acquitted by the Senate and not fully investigated by any grand jury.

And under the existing laws, we have ample tools. The federal criminal law makes seditious conspiracy a very serious crime. Now, I understand that the Attorney General doesn't want to appear to be prosecuting out of some political motive but a politically motivated desire not to prosecute so that it doesn't look like you're being political is equally political and much more dangerous.

So I'm hoping the Department of Justice really pursues the truth in these matters and doesn't leave it only to Congress.

BURNETT: Now, we'll have to see because as you're very clear, his answers there were, I mean, he could say anything but certainly did not lead you in that direction. Professor Tribe, I appreciate your time as always.

TRIBE: Thanks, Erin.

BURNETT: And next, Biden tears into Republicans surveilling on Democrats as the nation inches dangerously close to defaulting for the first time in U.S. history.


JOE BIDEN, PRESIDENT OF THE UNITED STATES: I think quite frankly it's hypocritical, dangerous and disgraceful.


BURNETT: Plus, the presidents, prime ministers, kings, even Putin's alleged mistress explosive new documents revealing where the world's wealthiest are stashing their money.



BURNETT: Tonight, get out of the way. President Biden calling Republicans hypocritical and dangerous as the U.S. heads towards its first debt default possibly in history.


JOE BIDEN, PRESIDENT OF THE UNTIED STATES: Not only are Republicans refusing to do their job. They're threatening to use the power, their power, to prevent us from doing our job, saving the economy from a catastrophic event. I think quite frankly, it's hypocritical, dangerous, and disgraceful.


BURNETT: And when asked if he could guarantee the United States wouldn't default, Biden said this.


BIDEN: No, I can't. That's up to Mitch McConnell.


BURNETT: But Minority Leader McConnell tells Biden, no, this is your problem.


SEN. MITCH MCCONNELL (R-KY): Democrats need to tackle the debt limit. I suggest that our colleagues get moving.


BURNETT: Of course, he won't raise the debt limit. I do, of course, have to point out that is the same Mitch McConnell who voted to increase or suspend the debt limit 32 times, already, in his career, 32 times according to "The Washington Post." I guess, 33's the charm?

But hypocrisy aside, let's be clear. America has long had a spending problem. Under Trump, the United States racked up nearly $8 trillion in new debt, 40 percent of the total debt Trump inherited, has tacked it on. Under then-President Obama, the debt rose by more than $9 trillion over eight years. 86 percent of the total debt he inherited. And Congress voted to raise the debt limit 78 times in the last 50 years for both Republican and Democratic presidents according to the Treasury Department. And not once has that resulted in any serious change in how the United States continues to borrow money.

OUTFRONT now, Democratic Senator Alex Padilla of California. He is a member of the Budget Committee.

And, Senator, I really appreciate your time.

So you got Republicans now saying they will filibuster any vote to raise the debt limit, which means you got to get 60 votes and you don't have 60 votes so you are not going to avoid a default that way. And that would mean you have to do it alone, through reconciliation. That's more time consuming. It means that Democrats are going to have to own this completely, right? You are not going to get anyone coming across party lines to support you.

But that may be the only way you can get this done. Do you support doing it that way?


SEN. ALEX PADILLA (D-CA): Well, first of all, good evening, Erin. Good to be with you.

And look, I think it's exactly what Mitch McConnell wants because even the reconciliation option is -- a lot of pitfalls that he is ready to exploit. So there's still time, and I still hope that we can appeal to our Republican colleagues to do the right thing. I mean, if they're just not going to -- if they're not going to be

helpful on raising the debt ceiling, and -- and do what they are doing now which is to actually obstruct Democrats willing to do it alone, then they should also explain why they are doing this. Are they going to apologize for having voted to add to the deficit in the past? Or are they going to apologize for having voted to raise the debt ceiling, as you said, Mr. McConnell himself, 32 times in the past.

Fiscally, it's the right thing to do. They have done it over and over again. It's just a sign of where Republicans are these days.

BURNETT: Right. Well, of course, you know, the right thing to do is to pay down debts that you have already incurred which is what this is about. The whole point of the debt ceiling was to, theoretically, every time you were going to do something new, to spark the conversation. And as I pointed out, it has not, or resulted in a cut in borrowing. And so, some are calling for the debt limit to be eliminate the altogether. Take a listen to this.


REP. SEAN CASTEN (D-IL): Would you support simply eliminating the debt ceiling so that we don't have to deal with this in the future and can focus on real crises?


MARK ZANDI, MOODY'S ANALYTICS CHIEF ECONOMIST: It's really a very counterproductive piece of legislation. So, yeah, I -- I'd get rid of it.


BURNETT: So, JPMorgan chase CEO Jamie Dimon told "Reuters" the debt limit is all politics. You have got a lot of people saying this. Would you support eliminating it, altogether?

PADILLA: Look, Erin, this is my first year in the Senate. I think that's a very worthwhile conversation to have but we are not going to rush that conversation here in the -- the handful of days between now and hitting the debt ceiling that's due October 18th, at the very latest. So we need to do now, what we need to do now to make sure that the government does not default.

I also want to make this play because when we talk about debt ceiling and the government defaulting, it can be over a lot of people's heads. Let's really be clear as to what this means, especially for working families across the country. If the government cannot pay its bills, what does that mean? Does that mean federal employees aren't being paid? Does that mean Medicare is not being paid or reimbursed? Does that mean unemployment insurance for people who are still struggling to get back to work because of the COVID pandemic are going to be impacted?

That's what Republicans are doing here. When they play with fire, like they are doing with this debt ceiling, it's working families that feel it the most. It's them that are hurt.

BURNETT: So, you know, I know obviously you are in the middle of -- well, theoretically, some negotiations here on this much larger bill that's bipartisan infrastructure bill that, so far, progressives have not allowed a vote on. And then, there is the bigger bill. Your Democratic colleague, Senator Kyrsten Sinema, of course, is at the center of that and she was confronted by protestors who were angry that she opposes the $3.5 trillion bill making its way through Congress.

And they even followed her into a bathroom to make their point. Here they are.


PROTESTER: Senator, we want to talk to you real quick. Can we talk to you real quick?

SEN. KIRSTEN SINEMA (R-AZ): Hey, actually, I am heading out.

PROTESTER: Right now is the real moment that our people need in order for us to talk about what's really happening. We need a Build Back Better plan right now.

PROTESTER: So that we can have justice and solutions that we need for immigration, labor.

PROTESTERS: Build back better, back the bill! Build back better, back the bill!


BURNETT: Okay. That -- that obviously is not okay. But what does it tell you about how ugly this fight is getting, Senator?

PADILLA: Well, look, I think it's indicative of how urgent a lot of these infrastructure investments are and we know there is two packages. There's the bipartisan package that was already approved by the Senate. We are looking at the bigger infrastructure package that's through this reconciliation process and that's why I think people are so attuned to how much money are we going to be investing in? And, you know, what the negotiations are like because it's really hard for working parents to get back to work if you don't have a safe place to leave your kids.

So yes, we need to invest in childcare. Have you seen the homeless situation in most cities across the country? Yes, we need to invest in housing. And if we have learned nothing else from this pandemic, it's the need to modernize our healthcare infrastructure and expand capacity of our healthcare infrastructure, in addition to what we are doing with other parts of the packages -- investing in public transit, transportation, the electrical grid, broadband deployment, and more. It's not what American people want. It's what American people need.

BURNETT: All right. Well, Senator, I appreciate your time. Thank you so much, Senator Padilla. PADILLA: Thank you, Erin.

BURNETT: And next, a massive and jaw-dropping new report revealing where some of the richest people in the world are after stashing their money. We are talk being celebrities, athletes, to Putin's alleged mistress.

Plus, Trump's former White House press secretary says she is, quote, terrified of her former boss running again.


Well, then, why did she speak up for him for so long?


BURNETT: Tonight, former British Prime Minister Tony Blair, Vladimir Putin's alleged mistress and so many more. The secrets behind their money exposed. Millions of confidential documents that reveal the systems that help them and others hide their wealth.

Alex Marquardt is OUTFRONT.


ALEX MARQUARDT, CNN SENIOR NATIONAL SECURITY CORRESPONDENT (voice- over): An explosive trove of documents revealing a stunning range of efforts by some of the most powerful people in the world to stash assets and purchases through networks of shell accounts and trusts.

UNIDENTIFIED MALE: We are talking about some of the most famous people in the world that are in these documents, presidents, prime ministers, government ministers.

MARQUARDT: The international consortium of investigative journalists collaborated for two years with more than 600 journalists to analyze almost 12 million documents they obtained, calling them the Pandora Papers. Among the outlets was "The Washington Post."

GREG MILLER, INVESTIGATIVE FOREIGN CORRESPONDENT, THE WASHINGTON POST: Highlights that this is a -- that the persistence of the offshore financial system, this parallel universe that wealthy, elite, rich leadership-type people around the world take advantage of.

MARQUARDT: The documents from 14 offshore services firms highlight often legal but ethically questionable avenues used by the rich and powerful, like former British Prime Minister Tony Blair and pop superstar Shakira, both of whom denied any wrongdoing.

In ritzy Monaco, an offshore company in 2003 bought a $4 million luxury apartment. The owner of that company? A woman who has reportedly been romantically linked to Russian President Vladimir Putin. She had given birth to a daughter. A Russian investigative group claims the father is Putin. The same group found that the woman shared assets with others in Putin's inner circle, and has amassed significant wealth. MILLER: It reinforces the perception of Russia and its economy and

its system as a state in which those who are close to Putin benefit. So that story to me is one of the most astonishing kind of, bit of detective work that we were doing.

MARQUARDT: Putin's spokesman called the reports a perversion of information, a number of rather unsubstantiated allegations. One story unlikely to go down well is about the king of Jordan whose country receives billions in aid. Yet, King Abdullah II appears to have spent over $106 million on properties in London, Washington, D.C., and Malibu, California. Nearly 70 million of that was on three adjoining Malibu cliff side mansions.

Jordan's royal court said that the report distorted and exaggerated the facts. It is no secret that his majesty owns a number of apartments and residences in the United States and the United Kingdom. This is not unusual, nor improper.

What is unusual is seeing U.S. states included alongside well-known foreign tax havens. Fortunes moving from the Caribbean into the U.S., the ICIJ says, with trust companies appearing in Florida, Delaware, Texas, Nevada, and more. Nowhere more than in South Dakota, the ICIJ says, which has become a major destination for foreign money, with assets and trusts quadrupling in the past decade to $360 billion.

MILLER: They are competing on this global economy, and they are trying to draw business to their states. And they're doing it by offering secrecy to people offshore.


MARQUARDT (on camera): Given the staggering number of documents here, there are countless other stories about how all kinds of powerful people have moved their money around with more revelations sure to come. Erin, viewers may remember the Panama Papers from five years ago.


MARQUARDT: That was just one firm's documents. This is 14 firms.

Now, the State Department spokesman said today that the Biden administration is reviewing the findings. The Treasury Department is deeply engaged in that -- Erin.

BURNETT: All right. Thank you very much, Alex.

And next, more on our breaking news. Facebook just coming back online after one of the longest outages in the company's history coming as the company faces damning accusations from someone who is on the inside. So what caused the outage? Was it all a coincidence?

Plus, a former member of Trump's inner circle says she is terrified her former boss will run again. Well, why then was she singing such sycophantic tunes while in the White House?



BURNETT: Breaking news, Facebook, along with its other companies Instagram and WhatsApp, slowly coming back online after one of the longest outages in the company's history. An outage happening just hours after a damning interview with a former employee claiming the company is aware of how its platforms are used to spread hate, violence, and misinformation, and has actively chosen to not do anything to stop it.

I want to go OUTFRONT now to Jeff Horwitz. He is the technology reporter for "The Wall Street Journal" who is behind "The Journal's" explosive project Facebook files. Where I know you received thousands of pages of internal documents from that Facebook whistle-blower, Frances Haugen. You received this over time. And you have been breaking this over the past couple weeks. Stock's down 15 percent since your reports started. Of course, we just found out her name last night.

But, Jeff, let me ask you about this outage just to start. Because it's -- it's massive, right? You have now got 3 billion people who interact with those products around the world. The company's still not confirming the cause.

So, is this timing really just a bad coincidence for Facebook as it is dealing with this very, very massive moment?

JEFF HORWITZ, TECHNOLOGY REPORTER, THE WALL STREET JOURNAL: In terms of if you are asking if there is any link between the reporting that's come out recently about them and this or the whistle-blower, I -- I think coincidence, very definitely. This is Facebook basically managed to disconnect itself from the Internet at large, just kind of the map of the internet. They are kind of -- severed those ties briefly. They are back up now and -- or at least in the process of restoring across a whole bunch of services and this is just hugely damaging to the company.

I think what it does show is just the -- how much responsibility Facebook has taken on to be in charge of the world's communication systems. And --


HORWITZ: -- also, the fact that we don't have a clear sense of why this is happening does sort of suggest how hard it is for outsiders to get information about societally vital things happening inside that company.

BURNETT: Well, it's true, and also, I mean, I know this may sound a little strange, but we are having one conversation about why don't they do more to change all these things? And it sounds like they are not even able to know or to figure out exactly how to get themselves back connected to the Internet. I mean, it's pretty incredible they are out for six hours and they don't seem to know what happened. That should be pretty terrifying to people. HORWITZ: There's been a lot of concerns and just to tie this back

into some of the kind of concerns about content and regulation of the platform, about complexity at Facebook and about the company's ability to manage the extremely convoluted and complex machine it's built. And I think, obviously, I'm not going to connect infrastructure to, you know, misinformation-type things or -- or, you know, civic integrity type concerns. But it does seem that sometimes the company's held together with duct tape.

BURNETT: So, you spoke to the Facebook whistle-blower, Frances Haugen, for months. Ten months, right? I mean, you know more about this than anyone. I know we now know her name but you have known her for a long time and you have seen all these documents. So she is going to tell Congress tomorrow that the company could quote/unquote destroy her for speaking out. Is that a legitimate worry?

HORWITZ: Facebook does require all of its employees to sign nondisclosure agreements. And they are very strict. So theoretically, Facebook could try to make a case that she'd violated it. That said, there is protection for people who report things to the government as whistle-blowers which obviously she's pursued those protections.

BURNETT: All right. Well, we will see. I mean, this is pretty stunning and, you know, again, congratulations on all your reporting. It's been fascinating to read it. Getting front-page treatment as, of course, it so deserves.

Thanks so much, Jeff.

HORWITZ: Thank you.

BURNETT: All right. Next, a former-Trump insider turns on her boss of five years. Why now?



BURNETT: Tonight, terrified. That's how Trump's White House Press Secretary Stephanie Grisham says she feels about a possible return to the White House for President Trump.


STEPHANIE GRISHAM, FORMER WHITE HOUSE PRESS SECRETARY: I am terrified of him running for president in 2024. I don't think he is fit for the job.


BURNETT: CNN correspondent Kate Bennet is out front.

So, Kate, Grisham worked for Trump for more than five years. She is out with a new book "I Will Take Your Questions Now." I suppose maybe that shows she understood she didn't take them then, when she had the job of -- of -- of working with the press. But now, she is speaking out saying she is terrified and he's not fit for the job. What else is she saying?

KATE BENNETT, CNN WHITE HOUSE CORRESPONDENT: Well, she is saying that a second term with Donald Trump might mean four years of revenge, of going after his political adversaries. Of going after people who voted for impeachment. I think her point is, or at least part of the reason she is saying she wrote this book is to warn against that, to say what she saw was -- was pretty much hell-bent on revenge for the second term and a second term would probably mean no guardrails for Donald Trump.

BURNETT: Oh, for sure. Isn't that what you have to lose --


GRISHAM: I just warned people that once he takes office, if he were to win, he doesn't have to worry about re-election anymore. He will be about revenge. He will probably have some pretty draconian policies that -- that go on.


BENNETT: Yeah. I mean, this is, again, what Grisham was saying is that without the worry of a prolonged political career after a second term, who knows what could happen? And that's certainly part of the concern for saying she is terrified about him.

BURNETT: I mean, Kate, it's amazing during her time in the White House, of course, Grisham told -- said a lot of things that weren't true, you know? She also spoke glowingly of the president and the first lady. Here is just a few examples.


GRISHAM: This is a first lady that really embodies the American dream.

I've seen him behind closed doors, and all the president cares about is this country.

She is doing such good work on behalf of children and has such a heart of gold and is actually quite a rock for this family.

All of his policies are working. It's just that we are not getting any coverage of it.


BURNETT: I mean, I have seen it behind closed doors and all he cares about is this country on one hand. And on the other, I'm terrified he's not fit for the job. Why is she saying this now?

BENNETT: Well, she says that after spending time in the west wing, that what she saw was an administration that was run on chaos and not about the country. And it was just about survival. So clearly, as we saw, her opinions changed. Now, whether or not, you

know, she is to be believed, that's up to people reading the book. Of course, Donald Trump has pushed back hard on this. He said she was never fit for the job. She was never up for it. Of course, he hired her as press secretary.

Melania Trump, today, released a statement to CNN calling Stephanie Grisham a troubled individual. There's some irony, though, Erin, in having these -- the former president and first lady attack Stephanie Grisham using the same language and the same tactics, the same personal takedowns that she probably helped orchestrate herself when she was on the other side of that Trump administration from the inside.

BURNETT: Right. Right. Right. I mean, yeah, such -- such a great point. And, of course, as you point out, hired her. Kept her on. Promoted her, you know?

BENNETT: Many years.

BURNETT: Yeah. All right. Thank you so much, Kate.

BENNETT: Thanks.

BURNETT: And thanks to all of you for joining us.

Anderson starts now.