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Early Start with John Berman and Zoraida Sambolin

Biden's National Security Strategy Identifies China As "America's Most Consequential Geopolitical Challenge"; Migrants Face Regional Challenges Trying To Reach U.S. Border; Social Security Recipients To Get Biggest Cost Of Living Increase In Decades. Aired 5:30-6a ET

Aired October 13, 2022 - 05:30   ET



CHRISTINE ROMANS, CNN ANCHOR: All right, Brynn. Thank you for that.

Surging inflation is about to have an effect on millions of people's Social Security checks. And the Biden administration's plan to offer thousands of migrants a legal path to enter the U.S.


ROMANS: All right.

President Biden's first formal national security strategy identifies China as America's most consequential geopolitical challenge.

CNN's Selina Wang live from Hong Kong with the developing story. What else does President Biden's document say?


SELINA WANG, CNN INTERNATIONAL CORRESPONDENT: Well Christine, in those 48 pages it lays it out as outcompeting China and restraining Russia, but makes it clear that it is China that is the long-term challenge. It says while Russia poses this immediate threat with its brutal war against Ukraine, China is the only country with the intent and, increasingly, the power to reshape the international order.

U.S.-China relations right now -- they are at the worst point in decades. And while the Biden administration has said it does not seek a new cold war, his vision does lay out a world where America and its allies are increasingly in competition with China, Christine.

ROMANS: And we're also seeing a very rare sight, Selina, in Beijing. You're seeing these public protests against China's heavy-handed COVID restrictions. What's happening?

WANG: Well -- so, there were two big banners hung over a busy overpass in Beijing. In the videos, you can also see smoke coming from the bridge. We don't know what the source of the smoke is. And one of the banners reads this, Christine. Quote, "Go on strike. Remove dictator and national traitor Xi Jinping." There was also a loudspeaker with an unidentified voice reading the banners.

Now, this may just seem like a few banners hung in the capital, but I can't overstate just how rare and extraordinary this is to have, in the capital, not just opposition toward zero-COVID but towards Xi Jinping himself. And it's coming at such a sensitive time. We are just days away from the Party Congress when Xi Jinping is expected to step into an unprecedented third time as China's supreme leader.

There was also another banner that read, quote, "Say no to COVID tests, yes to food. No to lockdown, yes to freedom. No to lies, yes to dignity. No to great leader, yes to vote. Don't be a slave, be a citizen."

And we've talked before about these punishing zero-COVID policies in China where entire cities are still being put under lockdown over just a handful of COVID cases -- close contacts. And cases are sent off to government quarantine facilities. So we have seen growing dissent.

In terms of this incident, we don't know if any arrests were made, but punishment for something like this could be severe.

ROMANS: Right.

WANG: The people involved -- they could face prison time or even worse, Christine.

ROMANS: Wow. All right, Selina Wang. That's just remarkable to have visible protests like that in Beijing. Thank you so much.

The Biden administration is set to roll out a plan offering thousands of Venezuelan migrants a legal path to the U.S. As many as 24,000 Venezuelans, with a U.S. sponsor, would be accepted into the program. At the same time, the administration is expanding a pandemic-era health rule to expel those who cross the border illegally.

Migrants face enormous regional challenges in a difficult journey to the U.S. southern border.

CNN's Rafael Romo has more.


RAFAEL ROMO, CNN SENIOR LATIN AMERICAN AFFAIRS EDITOR (voice-over): In Panama, they're the target of an air and land military operation.

UNIDENTIFIED MALE: (Speaking foreign language).

ROMO (voice-over): In Colombia, the country's Coast Guard is trying to intercept them in the ocean. And in Guatemala, national police in riot gear try to stop them, but they lack the numbers to do so.

From South America to the United States, trying to stop yet another wave of migrants seems to be a losing battle for all the countries involved. It seems like more than ever, migrants are willing to face any risk and pay ever-increasing amounts of money to reach the United States. In Panama, the number of migrants who continue crossing the perilous Darien jungle is increasing. By the end of September, over 134,000 had crossed the Colombian border into Panama, already surpassing last year's total of 133,000.


ROMO (voice-over): This Marine Corps captain in Colombia says that smugglers used to charge $1,000 per person to cross from the Colombia, San Andres, and Providencia Islands to Central American countries like Nicaragua -- an amount that he says has now increased to $4,000.

The influx of migrants is not only increasing, the nationalities of those seeking to reach the United States have also changed in the last few years.


ROMO (voice-over): This Guatemalan immigration official says they routinely detain migrants from countries as close as Cuba and Haiti and as far as Senegal. But these days, most seem to be Venezuelan nationals.

UNIDENTIFIED MALE: (Speaking foreign language).

ROMO (voice-over): This man in Caracas, who chose not to reveal his identity because he works for the government of Venezuela, says he's desperate to leave his country. He says his government job pays about $5.00 a week, which forces him to hold two other jobs to make ends meet.

UNIDENTIFIED MALE: (Speaking foreign language).

ROMO (voice-over): He says he's decided to leave. The question is how to get safely to the United States with no visa for any Central American country for his final destination.

Cousins Mario Mosquera and Jefferson Losada (PH), also from Venezuela, have already made it as far as Guatemala.


MARIO MOSQUERA, VENEZUELAN MIGRANT: (Speaking foreign language).

ROMO (voice-over): "Venezuela is unlivable," the father of three says. "The economic crisis has been very hard and the truth is that I'm making this sacrifice to give my children a better life."

As the United States approaches midterm elections, immigration has once again become --

REP. JODEY ARRINGTON (R-TX): This crisis is a direct result -- let's be very clear -- a direct result of President Biden's unilateral actions. ROMO (voice-over): -- a political hot potato, with Republican governors from Texas and Florida busing immigrants to places like New York and Washington, D.C.

RAUL REYES, ATTORNEY AND IMMIGRATION ANALYST: What we have here just is sort of a perfect storm. New York shelter systems were overcrowded and overwhelmed before any of these migrants arrived. Meanwhile, at the border, we're seeing the same -- a similar situation with a different population of migrants where their resources are very strained.

ROMO (voice-over): Back in Guatemala, cousins Mario Mosquera and Jefferson Losada press on. In Venezuela, minimum wage is not even enough to eat, they say, before leaving to join a group of other migrants with whom they share the same dream of reaching the United States regardless of the risks involved.

Rafael Romo, CNN.


ROMANS: All right.

A pandemic backslide. ACT test scores dropping to their lowest level in 30 years. And fake heiress Anna Sorokin talks to CNN about her deportation battle.



ROMANS: All right, let's get a check on CNN Business this Thursday morning.

Looking at markets around the world, Asian shares closed down. Europe has opened slightly higher. And on Wall Street, stock index futures barely moving this morning.

Stocks finished the day lower as investors digested a bigger-than- expected monthly jump in producer prices for September. All three indices ended little changed after a late afternoon drop erased gains from earlier in the day. The S&P 500 suffering its sixth consecutive loss, now down 25 percent since the start of the year.

The Federal Reserve also released the minutes from its last interest rate policy meeting. Fed officials reiterated their commitment to taming inflation. They expect higher interest rates to remain in place.

Gas prices, overnight, fell a penny, now at $3.91 a gallon.

Tens of millions of Americans will find out today just how much more money they'll get in Social Security benefits next year. Because of red-hot inflation, the government's cost of living adjustment will likely rise more than it has in 40 years, on top of a big 5.9 percent increase in 2022. Based on recent inflation data, we think it could be somewhere around 8.7 percent for that COLA -- that Cost of Living Adjustment.

This matters for millions of Americans. We're talking about bigger checks for the 52 1/2 million people who are receiving Social Security and the nearly 18 million who are beneficiary survivors. They receive Social Security disability or supplemental security income (SSI). That's for very low-income people. For the average Social Security check next year, that's about a $145 increase to just above $1,800 a month.

Inflation is still hot, running at -- near its highest level in more than four decades. And the Fed has more work to do to cool it. Factory-level inflation softened at an annual basis 8.5 percent. You can see that turn there on that chart. But from August to September it rose more than expected. Consumer prices are due at 8:30 a.m. eastern time.

Let's bring in Rachel Siegel, economics reporter at The Washington Post. Rachel, good morning. Thanks for joining us today.

You know, these inflation numbers illustrate why the Fed is cranking up interest rates. Inflation has been too hot for too long. The Fed was late to this game and now some are worrying it might be overcorrecting.

RACHEL SIEGEL, ECONOMICS REPORTER, THE WASHINGTON POST (via Webex by Cisco): That's exactly right. After the Fed had been really dragging its heels on clamping down on inflation by rising interest rates and trying to slow down the economy, they are not being hit with the opposite criticism. And that really has to do with the fact that they are moving at the most aggressive pace in decades.

But the full scope of what they're doing isn't going to hit for months. There are these lag effects associated with massive rate hikes that could really all come to a head sometime next year or even later this year.

ROMANS: Yes. In the -- in the Fed's last meeting, officials expressed concern about inflation. I want to read you this from the minutes. "Inflation had not yet responded appreciably to policy tightening and that a significant reduction in inflation would likely lag that."

When will monetary policy start showing up in these numbers?

SIEGEL: That is really such an open question. We've already seen it in the housing market. That's one of the sectors of the economy that is most sensitive to higher interest rates. But we're not really sure when this bigger, sort of, tidal wave that I tend to think of could hit. It's probably sometime next year. Economists put a range of, say, six to 12 months for a rate hike to fully infuse through the economy.

At the same time, though, central banks all over the world are now hiking interest rates and that could really have this magnifying effect that we also don't fully understand.

ROMANS: Yes, exactly. And also, just hiking rates so fast and so -- by so much, we have no idea what kind of dislocations that could cause in the global economy.

SIEGEL: That's another open question. It could have bearings on financial stability, on the stock market, and just on Americans' understanding of where things are headed. All of this uncertainty is really looming over some of the pain that policymakers like chair Powell and other Fed officials have warned are yet to come.

ROMANS: So the Fed has teed up a couple more rate hikes here, and there's an election right around the corner. Of course, the Fed keeps itself -- tries to keep itself at an arm's length from the political fray. But inflation will be front of mind in the voting booth, won't it?

SIEGEL: It will, and inflation is the top economic problem. It's a problem that Republicans have repeatedly blasted Democrats for, especially given Democrats' large stimulus measures from earlier in the pandemic. The Democrats are trying to convince people that they can steer the economy and lower the cost of living for people without ruining things like the job market and the economy signs of strength.

The Biden administration will repeatedly say that they respect the Fed and are not going to influence their rate hikes of any shape or form. But as you mentioned, this is all coming to a head just a couple of weeks before the midterm elections.


ROMANS: All right, Rachel Siegel, Washington Post. Nice to see you. I know you'll be watching those numbers -- 8:30 eastern is when they land. These inflation numbers have become the most talked about numbers on Wall Street, Washington, and frankly, in the headlines because of how high they are.

Rachel, thank you so much.

SIEGEL: Thank you.

ROMANS: All right.

Just ahead, the January 6 House Committee's closing arguments before the midterms. And the Treasury Department now investigating Florida Gov. Ron DeSantis and his migrant flights.



ROMANS: All right, to your budget now. The cost of heating your home is likely to soar this winter. The Energy Information Administration estimates heating a home with natural gas will rise about $200, while heating oil is forecast to jump a whopping $1,200. Electric heating could go up to more than $1,300. And propane heating is expected to rise by more than $1,600.

All right, ACT test scores falling to their lowest point in three decades. New data shows that the class of 2022's average ACT score was 19.8 out of 36. It's the first time that average score dropped below 20 since 1991. Now, the scores have been steadily falling for five years in a row.

The chief executive of the ACT blames the drop on long-term systemic issues in education and learning and disruptions caused by the pandemic.

The Padres will head home to San Diego with their playoff series against the Dodgers even at one game apiece.

Coy Wire has this morning's Bleacher Report. Hey, Coy.

COY WIRE, CNN SPORTS CORRESPONDENT: Top of the morning to you, Christine.

The Dodgers had the best record in baseball this season. One hundred eleven wins was the most by a National League team in 116 years. But the Padres are showing the world they can play with anybody.

In game two, last night, a heavyweight title fight. Both teams swinging big, each refusing to go down. The Padres' Manny Machado at the plate, powering one out of the park just past the left field pole, getting the party started, putting the Padres up one in the first.

Dodgers, your turn. Freddie Freeman and Max Muncy say we'll see your homer and raise you. A pair of solo homers in the first and second, putting L.A. up 2-1. But then, tied in the sixth, the Padres' Jurickson Profar -- this one not so far but still puts this one out of reach. The RBI single putting San Diego ahead for good. They'd win 5- 3.

The series now tied at one apiece. Goosebump moment for fans in their first-ever postseason win against the Dodgers.

Speaking of goosebumps, game interruption in the eighth by a wild game animal. A wild goose on the loose. If this were a football game, Christine, that bird would have been tackled by now. Not necessary here, though.

The goose quack-quiesced and let the grounds crew waddle it away. And good to see they recycle there. A rally goose might become the thing for Padres fans.

Game three in San Diego tomorrow.

Game two of Phillies versus the world champions Braves had nearly a 3- hour rain delay in Atlanta, but fans that stuck around soaked in a win.

Dansby Swanson wowing the crowd with tracking down a pop fly ball. Fantastic over-the-shoulder grab in the sixth. But teammate Austin Riley says hold my beer. Here's an over-the-shoulder catch of my own.

The Braves breaking out the leather, getting the 3-0 win to tie their series at one apiece as well. In the American League taking center stage on our sister channel TBs later today. The Mariners and Astros at 3:37 eastern, followed by Guardians and Yankees just after 7:30.

NFL now. Raiders receiver Davante Adams has been charged with misdemeanor assault for pushing a photographer after Monday night's loss to the Chiefs in Kansas City. According to the court document, Adams caused whiplash and headache, and possible minor concussion when he shoved the man to the ground as he left the field.

Adams later apologized for his actions on Twitter and in the locker room.


DAVANTE ADAMS, LAS VEGAS RAIDERS WIDE RECEIVER: I bumped into him and kind of pushed him and he ended up on the ground. So I want to say sorry to him for that because that was just frustration mixed with him running -- literally just running in front of me. And that was -- I shouldn't have responded that way, but that's how I initially responded, so I want to apologize to him for that.


WIRE: Adams' court appearance is scheduled for November 10. No word yet on any potential discipline by the NFL.

And Christine, you may not quite recognize your Chicago Bears in "THURSDAY NIGHT FOOTBALL." For the first time in their 100-year history, they're going to be rocking orange helmets. You couple that with an alternate orange jersey and star linebacker Roquan Smith says he ain't mad at it.


ROQUAN SMITH, CHICAGO BEARS LINEBACKER: I think it's pretty sweet, you know? It's a helmet. You know, it's orange. It's different.


SMITH: Yes. But I think it's pretty cool just to go out looking like a highlighter or something, you know. So it'll be cool -- like, it'll be cool -- yes.


WIRE: Or kind of like a pumpkin, right, Christine? Halloween is in the air. We'll see if they are a trick or a treat for you versus the Commanders tonight.

ROMANS: I know. I was going to say like a road construction crew all in their bright orange. And you're reminding me it's Thursday. I've got to get on my fantasy team to make any changes I need to before tonight's game.

WIRE: There you go. Happy Friday eve. ROMANS: Yes, exactly.

All right, Coy. Nice to see you.

WIRE: Uh-huh.

ROMANS: All right, thanks for joining me. I'm Christine Romans. "NEW DAY" starts right now.