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Early Start with John Berman and Zoraida Sambolin
Lawmakers Fight Each Other Amid Multiple U.S. Crises; Biden Immigration Moves Change Little At The Border; Upstart Investors Angry After Online Brokers Curb Trading. Aired 5:30-6a ET
Aired January 29, 2021 - 05:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
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[05:31:27]
CHRISTINE ROMANS, CNN ANCHOR: All right, good Friday morning, everybody. This is EARLY START. I'm Christine Romans.
LAURA JARRETT, CNN ANCHOR: And I'm Laura Jarrett. Just 31 minutes past the hour here in New York.
This morning, the United States facing a raging pandemic, a struggling economy, domestic terrorism. But the lawmakers -- the ones charged with addressing those problems -- openly at war with each other.
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REP. NANCY PELOSI (D-CA): We will probably need a supplemental for more security for members when the enemy is within the House of Representatives -- a threat that members are concerned about, in addition to what is happening outside.
We have members of Congress who want to bring guns on the floor and has threatened violence on other members of Congress.
(END VIDEO CLIP)
JARRETT: The enemy is within. Pretty hard to get things done when trust is this low.
And this isn't about policy disagreements; this is about basic safety. Prime example yesterday, Sen. Ted Cruz tweeted he agreed with Congresswoman Alexandra Ocasio-Cortez on the need to investigate this week's events on Wall Street involving GameStop. AOC clapped back to Ted Cruz, you can sit this one out -- tweeting "You almost had me murdered three weeks ago."
ROMANS: Ooh.
All right. Meanwhile, Republicans unmoored, still afraid to move away from Trump. The House Republican leader went to Florida yesterday looking for a mutually beneficial reset after the insurrection. For days, there's been a budding intra-Republican war over the party's futures. Members poisoning each other's reputations, defending conspiracy theories, and more.
One new House Republican putting it this way.
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REP. PETER MEIJER (R-MI): It's important to stand up and stand by our oath to the Constitution and to say there are better ways for us to govern that don't devolve into threats of political violence into, you know, these illusions to just insane theories. I mean, that is not a strong party; that is a party that is nearing its end.
(END VIDEO CLIP)
ROMANS: Speaking of political violence, tension on Capitol Hill. Police arresting a West Virginia man armed with a handgun and 20 rounds of ammunition Wednesday.
Seventy-one-year-old Dennis Westover had what a police affidavit called "Stop the Steal" paperwork, including a list of congressional and West Virginia lawmakers and their contact information. Westover was tagged in a Facebook post at former President Trump's rally on January sixth before the insurrection.
The acting chief of Capitol Police has now called for permanent fencing and other enhanced security around the Capitol complex.
JARRETT: The New York attorney -- state attorney general reporting that Gov. Andrew Cuomo's administration undercounted thousands of nursing home residents who died of coronavirus. Hours later, health department officials made public new data that added more than 3,800 deaths to their tally, representing nursing home residents who actually died in hospitals.
In a statement, the New York State Health Department commissioner denied that there was any undercount. He says the state always reported deaths in nursing homes and hospitals separately.
It all casts a renewed light on the state's decision to send some nursing home residents who had been hospitalized with coronavirus back into their nursing homes, a policy Gov. Cuomo has defended as following federal guidelines.
ROMANS: President Biden getting a reality check on efforts to reopen schools in his first 100 days. There are two reasons.
The first is partisan gridlock. The president is pushing Congress to approve another $170 billion for K through 12 schools, colleges, and universities but there has not been a lot of Republican cooperation. The White House says it's willing to trim the size of the relief bill but considers all the components essential. It won't break them up but could consider a smaller size.
[05:35:00]
The second problem is medical. Even with cases in hospitalizations trending down and new data from CDC suggesting kids can return to classrooms with the right precautions, all of these new variants add to the unknown risks.
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DR. ANTHONY FAUCI, DIRECTOR, NATIONAL INSTITUTE OF ALLERGY AND INFECTIOUS DISEASES, NATIONAL INSTITUTES OF HEALTH, CHIEF MEDICAL ADVISER TO PRESIDENT JOE BIDEN: The president is taking very seriously the issue, both from the students' standpoint and from the teachers' standpoint. And he really wants to and believes that the schools need to reopen in the next 100 days -- essentially all the K to eight schools within 100 days. That's the goal. That may not happen because there may be mitigating circumstances, but what he really wants to do is everything within his power to help get to that.
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JARRETT: The kids are the ones still paying the price, as are their parents who, in many cases, can't work.
In Chicago, a little more than 10,000 students have opted out of in- person learning recently amid a contentious battle between the teachers union and public schools there. Now only about a third of the eligible students plan to return in person.
And in New York City, public school enrollment has dropped four percent. It's the sharpest decline among the youngest students. Total enrollment in the nation's largest school district now dipping below one million for the first time in 15 years.
ROMANS: That's remarkable.
New York City's mayor says he's ready for indoor dining to resume if the governor allows it. So when could restaurant doors reopen?
CNN is covering this pandemic coast-to-coast.
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ATHENA JONES, CNN NATIONAL CORRESPONDENT (on camera): I'm Athena Jones in New York where news about when indoor dining can resume is expected by today. Mayor Bill de Blasio saying the decision is up to the state and that it will be driven by data and science. De Blasio saying I want to see the people who work in the restaurants have their livelihoods.
This comes as New York Gov. Andrew Cuomo announced the state would life COVID-related restrictions in all zones except for a handful in and around New York City, citing a decline in COVID positivity rates and hospitalizations.
DIANNE GALLAGHER, CNN NATIONAL CORRESPONDENT (on camera): I'm Dianne Gallagher.
One of the largest mass vaccination sites in the entire country is set to kick off on Friday in Charlotte, North Carolina. It's through a public-private partnership at Bank of America Stadium. That's where the Carolina Panthers play. The expectation is roughly 19,000 first doses will be given out to people who can either drive or walk up to get that vaccine.
EVAN MCMORRIS-SANTORO, CNN CORRESPONDENT (on camera): I'm Evan McMorris-Santoro.
The governor of Ohio will set aside some of his state's vaccine allocation, specifically for the teachers and staff at K through 12 schools. Gov. Mike DeWine wants students back in classrooms in Ohio by March first and he says setting aside 55,000 doses of the vaccine per week, specifically for teachers, will help make that happen. In Ohio, DeWine says every school district but one has signed on to his March first plan.
NICK WATT, CNN NATIONAL CORRESPONDENT (on camera): I'm Nick Watt in Los Angeles where the superintendent of this, the second-biggest district in the nation, just said this about when schools might be able to reopen -- maybe later this spring. The word maybe is doing quite a lot of work there.
He wants all staff to be vaccinated first. The unions will need to get on board and right now they're not that cooperative. And also, the infection rate will need to be at least half in L.A. before those schools can open their doors.
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JARRETT: All right, thanks to all of our correspondents for those reports.
The White House now pushing back plans for President Biden to sign an executive order that would admit tens of thousands more refugees to the United States. That plan just one of the flurry of early immigration announcements from the administration that at least, so far, hasn't changed the reality at the border.
CNN's Priscilla Alvarez is live for us in Washington. Priscilla, you cover these issues every single day. I think there was so much hope and anticipation from advocates for those who want to see changes at the border, but the reality is different.
PRISCILLA ALVAREZ, CNN POLITICS REPORTER (via Cisco Webex): That's exactly right, and the place where that's most evident is the U.S.- Mexico border.
So let me give you an example of why things are remaining the same. I spoke to a Cuban migrant who came to the U.S.-Mexico border seeking asylum with his wife.
So he fled Cuba, claimed political persecution, got to the U.S.-Mexico border in 2019 and was subject to a Trump-era policy that required him and his wife to wait in Mexico as their court hearing continued here in the United States. And so, in that duration of time as their cases proceeded through the courts, they have been assaulted, they have been threatened, and they have lost a baby.
And honestly, there are tens of thousands of migrants just like them who are desperately seeking answers from the Biden administration after being put and subject under this Trump-era policy. In fact, I even spoke to an attorney who said she's been receiving at least 50 calls a day from migrants who just want answers and we just don't have those yet.
[05:40:07]
And so there is urgency behind the actions that the Biden administration will take now in the coming months. But then, too, is the reality that the Biden administration could face legal challenges. In fact, we already saw that in less than a week. Just this week a federal judge blocked the Biden administration's pause on deportations.
So there's urgency behind the actions that need to happen, but the Biden administration also has to contend with the reality that they're going to face legal challenges along the way.
JARRETT: Yes, such an important point there to recognize that reality coming up against a lot of Trump-appointed judges on all of these issues.
I also want to talk to you more about what the first lady is up to when it comes to the border. We've learned that Jill Biden is taking on a new project. Tell us more about what you're learning there.
ALVAREZ: That's right. So we have heard that Jill Biden is going to have an active role in the task force that the Biden administration intends to set up that would focus on reuniting families.
Remember that under the Trump administration we had this separation of families at the U.S.-Mexico border. And, in fact, we know that lawyers are still searching for the parents of more than 600 children.
So we expect that the first lady is going to play an active role in the effort and in her involvement, bring more attention to the issue -- to the issues.
JARRETT: Yes, the reunification of those families. It's such -- it's just amazing. There are 600 of them still without their families. It's just -- it's just incredible.
Priscilla, thanks so much for getting up with us this morning. Nice to see you.
ALVAREZ: Thank you.
JARRETT: We'll be right back.
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[05:45:53]
ROMANS: Now to the Wall Street feeding frenzy this week. GameStop and AMC rebounding in after-hours trading after yesterday, they came back down to earth. Shares fell after some online brokers restricted trading -- restricted trading for this amateur group of traders who united to send shares of GameStop and AMC skyrocketing. Now, one of those online brokers, Robinhood, will allow limited buys of GameStop and AMC today.
Matt Egan joins us now with this captivating story. He's the lead writer for CNN Business.
And Matt, remember back in 2016, Robinhood was clear, let the people trade. Make it free, right? This week, not so much. For years, big investors slowly manipulated Wall Street and got away with it. Now the little guy does it for one day -- or a few days -- and now they want to put a stop to it.
Robinhood's CEO defended the moves last night on CNN -- listen.
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VLAD TENEV, CEO, ROBINHOOD: I want to be 100 percent clear. This decision was not made on the direction of any market maker or other market participants. We haven't really seen anything like this before and to prudently manage the risks and the deposit requirements we had to restrict buying in these 13 stocks.
(END VIDEO CLIP)
ROMANS: Matt, is that fair? I mean, the little guy finally gets an edge and beats the big hedge funds at their own game and suddenly, they have the restrictions.
MATT EGAN, LEAD WRITER, CNN BUSINESS: Well, happy Friday, Christine.
He is right about at least one thing. We've never seen anything like this. I mean, this is -- it's all pretty insane. If you'd pitched this story to a movie studio they would have rejected it because it's just too unrealistic.
But here's the problem with Robinhood's decision to ban buying of Game stock and why they quickly reversed. You can't, on the one hand, say that your mission is to democratize investing and then on the other restrict people from investing in stocks. It goes totally against the brand.
I mean, it would be like Amazon saying you have to go to the store to pick up your stuff, or Netflix limiting how many shows you can stream. It just doesn't work. So I'm not surprised by the backlash.
I think what's so important to remember is that none of the Reddit mayhem would have been possible without Robinhood. This app brought free trading to the masses. It forced all of its competitors to do the same.
ROMANS: Yes.
EGAN: I mean, gone are the days when options trading and leverage were just for rich people on Wall Street. You know, for better or worse, Robinhood has brought free trading and leveled the playing field for all. ROMANS: You know -- and to me, a lot of people are saying oh, this is some sort of like online manipulation -- all these people getting together to drive up the stock like a pump and dump scheme from the -- you know, the 90s or the 80s. But really, it's also kind of like an online -- an online -- like stock club, you know? There's nothing illegal about just deciding with a bunch of friends you all want to buy a certain stock if you want to.
You know, the GameStop and the other stocks that were targeted by the Reddit users -- they came back down to earth yesterday. Are we quickly learning the dangers about all of this here because I worry about the retail investor who has been hearing about all of this get-rich-quick this week and maybe now got hurt yesterday?
EGAN: Well, Christine, that's right. I mean, you never want to be the last person to buy in a speculative (INAUDIBLE). Yesterday we saw GameStop lose nearly half of its value. It was up nearly 1,000 percent on the year, which is absolutely amazing.
And we could see these stocks actually rebound today in premarket trading. GameStop, at last check, was up about 100 percent, doubling in premarket trading. AMC's up 50 percent.
But no doubt, to your point, this has been a wake-up call to everyone -- to investors, to lawmakers, to politicians. Yesterday, both the House and the Senate called for investigations. The New York attorney general said that she's reviewing the Robinhood situation. We even saw a brief glimmer of bipartisanship when Ted Cruz backed AOC's call --
ROMANS: Yes.
EGAN: -- for an investigation.
At the end of the day, this is a job for regulators. And don't forget a new top -- new top cop is coming to Wall Street. President Biden has nominated Gary Ginzler to lead the SEC. He has the blessing of Elizabeth Warren, which I think means that we should not expect him to treat hedge funds with (INAUDIBLE).
[05:50:04]
ROMANS: I think some of this craziness, really, about the -- says something about the mood on Wall Street, right? You've got free trading platforms. You have super, super-rich markets, right? You've got all this money floating around.
Is there a bigger picture here about what this is symptomatic -- emblematic of?
EGAN: Well, at a minimum, I think it's safe to say things are not normal in financial markets right now. I mean, there are so many signs of extreme market speculation driven in large part by rock-bottom interest rates. I mean, we've seen huge IPOs, including Airbnb and DoorDash go straight up on their first day of trading.
There is an unreal amount of money getting poured into SPACs. Those are those blank check shell companies that they don't actually have -- they don't actually own anything. They just exist to take companies public. And, you know, Goldman Sachs said just the other day that they see a bubble-like sentiment around SPACs.
Look at Tesla. It's worth almost $800 billion. It's worth more than every other major automaker around the world.
And, you know, just this -- the mob of Reddit traders pouring into GameStop is just another example of this speculative mania. But, you know, that's the thing, Christine, is bubbles are notoriously hard to time. They can keep going.
ROMANS: Yes, there's the COVID factor, too. You've got all these people home, working from home, access to the Internet, talking to their friends, buying stocks. You know, even borrowing money to buy stocks.
Matt Egan, so nice to see you. Thanks so much. Have a great weekend.
EGAN: Thank you, guys.
JARRETT: All right.
Six workers were killed and at least a dozen others hospitalized after a liquid nitrogen leak at a poultry processing plant in Gainesville, Georgia. Authorities say there was no explosion and the cause of the leak is under investigation. Preliminary reports indicate that a gas line ruptured.
ROMANS: In northern California, a woman was injured and 25 homes and other buildings damaged after a powerful winter storm unleashed heavy rain and snow that triggered mudslides. At least 4,000 residents under evacuation orders.
The storm dumped feet of snow, closing Interstate 80, that crucial artery linking northern California to Nevada.
JARRETT: In Oklahoma, a mother says her second-grader was kicked out of her private Christian school for telling another little girl she had a crush on her. Delanie Shelton says she was shocked when the school told her that they would be ending their partnership with her family.
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DELANIE SHELTON, MOTHER OF EXPELLED SECOND-GRADER: She was upset and crying, asking me if God still loved her, if she was wrong for the way that she feels. I don't believe that my kids should have been ripped out of the only school they've known for the past four years.
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JARRETT: Shelton says the unfortunate outcome provided her with a teachable moment with her daughter. The school pastor says he follows the Bible and has beliefs about relationships.
ROMANS: Second-grader -- what would Jesus do?
Taking a look at markets around the world to end the week, you can see declines for Asian stocks. European shares have opened lower, at least by one percent as well.
On Wall Street, futures at this hour also giving up some of yesterday's gains. Stocks climbed Thursday despite economic reports that underscored the need for more stimulus. The Dow bounced 300 points. The S&P and the Nasdaq also ended the day higher.
A major shift for General Motors. Call it the end of the tailpipe.
The automaker said Thursday it will start phasing out its gas-powered cars and trucks and sell only zero-emission vehicles by the year 2035. It is part of GM's larger goal of being carbon neutral by 2040. GM has already invested billions in electric vehicles, including $2.2 billion to turn its Detroit plant into an all-electric assembly plant.
This comes after President Biden signed a flurry of executive orders aimed at tackling the climate crisis.
GM's shift will likely put pressure on other automakers to make similar commitments to the environment.
JARRETT: In Chicago, a USPS mail carrier being praised for her quick thinking that helped save an elderly woman's life.
Shonda Lemon often greeted 89-year-old Helen on her mail route. So when Shonda noticed that Helen had stopped picking up her mail, she called the police. Authorities found Helen on the floor where she had fallen down. She was there for several days without food or water.
Helen is now recovering, thankfully. Her family is grateful to Shonda for being her guardian angel.
ROMANS: I just want to say a quick goodbye, and a thank you, and a we love you to our very own CNN legend, Rick Davis.
JARRETT: Yes.
ROMANS: Been here 40 years. He's the voice on the other end of the phone when you had -- as a journalist, you have a question or a concern, or wrestling with some sort of -- some sort of issue with your story.
This guy has saved my bacon so many times. I'm telling you, a great guy, great dad, great colleague. We love you, Rick. Congratulations -- 40 years at CNN. You're a legend.
JARRETT: Thanks for keeping us all in line.
ROMANS: Oh, wow. Thanks for joining us. I'm Christine Romans.
[05:55:00]
JARRETT: I'm Laura Jarrett. "NEW DAY" is next. (COMMERCIAL BREAK)
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REP. MATT GAETZ (R-FL): We are in a battle for the soul of the Republican Party and I intend to win it.
JEFF ZELENY, CNN CHIEF NATIONAL AFFAIRS CORRESPONDENT: With his looming impeachment trial, Trump remains front and center in the Republican Party, even as it faces an identity crisis.
UNIDENTIFIED FEMALE: It is absolutely shameful that Kevin McCarthy did this. You have all of these Republicans who are choosing to stand with Trump as opposed to choosing to stand with our Constitution.
UNIDENTIFIED MALE: I think we should expect new variants, and we are in a race against the variants right now.
WATT: The more contagious variant first found in South Africa is here.
DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: It almost assuredly means there's other cases out there.
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ANNOUNCER: This is NEW DAY with Alisyn Camerota and John Berman.
