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GOP Leaders Gear Up For Tense Talks After Disappointment Midterms; Bahamas Investigating Possible Misconduct In FTX Collapse; Musk And Tesla Heading To Court To Defend Compensation Package. Aired 5:30-6a ET
Aired November 14, 2022 - 05:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[05:30:00]
SCOTT MCLEAN, CNN INTERNATIONAL CORRESPONDENT: One quick mention about the victims and that's that six people have died. That includes a married couple, it includes a mother and her 15-year-old daughter, and a 9-year-old boy who was with a male relative. The good news is that of the 80 people who were injured and initially sent to the hospital, the vast majority of them have been released -- though at last word, five were still in intensive care, Christine.
CHRISTINE ROMANS, CNN ANCHOR: The arrests mounting this morning. All right, thank you so much, Scott McLean.
Quick hits around the globe right now.
A Princess cruise ship is docked in Sydney, Australia with 800 COVID- positive passengers on board. Officials say the cases are mild or asymptomatic and infected passengers are being isolated.
The Iranian refugee who inspired Spielberg's film "The Terminal" has died at the same Paris airport where he lived for 18 years. He was initially unable to leave or board a flight after losing his papers and later stayed by choice.
Street artist Banksy unveiling his latest work on social media -- a mural in the liberated Ukrainian town of Borodianka. It depicts a female gymnast balancing on a pile of rubble on the side of a building damaged by Russian strikes.
All right, new investigations into bankrupt crypto exchange FTX -- a $32 billion company that collapsed in a matter of days.
And Republicans pointing fingers at Donald Trump for a disappointing midterm performance.
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[05:35:53]
ROMANS: All right. Republican lawmakers bracing for tense talks this week as the party conducts a postmortem on its dismal midterm performance. A Republican Senate leadership election is set for Wednesday but Florida's Rick Scott says it doesn't make sense to hold the election this week. He's calling for a delay.
(BEGIN VIDEO CLIP)
SEN. RICK SCOTT (R-FL): What is her plan? Why -- what are we running on? What do we stand for? What are we hellbent to get done?
We -- you know -- you know, there's no plan to do that. The leadership in the Republican Senate says we know you cannot have a plan. We're just going to run against how bad the Democrats are -- and actually, then, they cave in to the Democrats.
They want to rush through an election because they don't want to do any assessment of what we've done wrong. Insanity is doing the exact same thing and thinking you're going to get a different result. We won't.
(END VIDEO CLIP)
ROMANS: Senator Lindsey Graham has also joined the calls for a delay to the leadership election until after the runoff in Georgia.
Scott says a lot of people asked him to run for Senate minority leader. Scott says he is not taking anything off the table.
Let's bring in CNN political analyst Rachael Bade, also the co-author of "Unchecked: The Untold Story Behind Congress's Botched Impeachments of Donald Trump." Good morning, Rachael.
RACHAEL BADE, CNN POLITICAL ANALYST, CO-AUTHOR, "UNCHECKED: THE UNTOLD STORY BEHIND CONGRESS'S BOTCHED IMPEACHMENTS OF DONALD TRUMP" (via Webex by Cisco): Good morning, Christine.
ROMANS: All right, so does McConnell have competition after the GOP underperformed in the midterms?
BADE: Yes. Look, this week is going to be, as they say in "SEINFELD," a festivus. There's going to be an airing of grievances and a lot of finger-pointing when Republicans return to Capitol Hill. They'll assess why their performance last week was so much worse than everybody was expecting.
In terms of Republican leaders, they're going to obviously be on the hot seat. Kevin McCarthy is going to have, potentially, a challenge this week to try to run for Speaker. He's in more trouble, I would say, than Mitch McConnell.
McConnell is seeing, right now, a lot of senators try to put the blame on him. And it's interesting because a lot of the senators who are most vocal criticizing McConnell are senators who are looking at running in 2024 and kind of want to win over Trump's base, and so they're not casting blame on Trump.
In the clip you just aired, Rick Scott, for instance -- he was actually running Senate Republicans' campaign arm and he's saying it's silly to do the same thing over and over again and have the same results. And yet, he's not talking about Trump and the drag the former president really was on Republicans themselves.
So it's a little bit of selective hearing and selective lesson-taking, but it's going to get ugly on the Hill this week.
ROMANS: Yes, totally.
No -- control of the House, of course, still undecided. You mentioned Kevin McCarthy. If Republicans win a slim majority, McCarthy is going to have to make concessions, right, to become House speaker. Will he have enough support?
BADE: That's the big question right now. I think McCarthy's camp has been projecting a lot of confidence, saying that they have sort of been laying this groundwork reaching out to members who kept him from becoming speaker just a few years ago in 2015 after John Boehner retired. But it's really deja vu for him. It's the same crop of freedom caucus conservatives who are saying we're not going to give you our vote until you give us what we want in terms of rules changes.
I would say the thing to watch carefully in the House is the motion to vacate. It's basically this rule that allows any conservative, any Trump ally to try to oust McCarthy by themselves -- one person -- if they're unhappy with him. And right now, they can't do that because of rules changes. They want the ability to do that and McCarthy has been very reluctant to give that over. But looking at this slim margin he's probably going to have to give them the farm.
ROMANS: Yes. Just this soul-searching postelection in the GOP has been fascinating to watch. Larry Hogan, the outgoing Republican governor of Maryland, is blaming Donald Trump for the GOP's poor performance in the midterm -- listen.
(BEGIN VIDEO CLIP)
GOV. LARRY HOGAN, (R) MARYLAND: People who tried to relitigate the 2020 election and focused on conspiracy theories and talked about things the voters didn't care about. They were almost universally rejected. And I think it's basically the third election in a row that Donald Trump has cost us the race, and it's like three strikes you're out.
(END VIDEO CLIP)
ROMANS: And then, Peter Meijer, who lost his race in Michigan -- a congressman -- he said this. He said the party continued to sleepwalk down the path of crazy following the January 6 insurrection.
[05:40:09]
Do you think the party pivots here?
BADE: No. I mean, we're already seeing Teflon Trump return. There was sort of this gut check right after the election last week. We saw the Murdoch media empire -- at least the conservative T.V. and print newspapers pointing the blame at Trump. And let's be honest. If Republicans were going to be honest with themselves they would be saying the same sorts of things.
But we're already seeing that sort of whiplash happen, right, on Capitol Hill. It's mostly these Trump allies who are out there being most vocal and saying we have to go in another direction. It's not people who are Trump critics out there saying we need to assess how damaging Trump has been to the party and the brand going forward.
So, people, again -- they're just taking what they want to see and sort of running with it. And there's obviously a bit of covering their eyes for Trump allies and acting like everything was hunky dory for the ex-president when that was not the case.
ROMANS: Certainly, it will be another consequential week in Washington -- no question.
Rachael Bade, thank you so much. Nice to see you.
BADE: Good to see you, too, Christine.
ROMANS: All right.
Elon Musk in court this week over the compensation package that made him the richest man in the world. And Tom Brady headlining the first NFL game ever played in Germany.
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[05:45:42]
ROMANS: All right, your Romans' Numeral this morning, the number three. That's how many times Republicans voted to raise the debt ceiling under the Trump administration.
Democratic Sen. Elizabeth Warren warning a split Congress could mean the Republicans, this time, played games with the debt ceiling.
(BEGIN VIDEO CLIP)
SEN. ELIZABETH WARREN (D-MA): If the Democrats take the House, then there's no urgency around this.
CHUCK TODD, MODERATOR, NBC "MEET THE PRESS": Right.
WARREN: But no matter what, the United States of America has to honor its outstanding obligations. Me? I'd get rid of the debt ceiling altogether. Many of these new Republicans who are coming in are people who are coming in with exactly one goal --
TODD: Yes.
WARREN: -- get Donald Trump elected in 2024. And they see that if they can create chaos in the economy, then they think that may move Donald Trump --
TODD: Right.
WARREN: -- one inch closer to election. So we've got to take that away from them.
(END VIDEO CLIP)
ROMANS: That debt ceiling expected to be hit sometime next spring.
Of course, Congress controls the purse strings. Partisan bickering over paying America's bills is a dangerous game for U.S. creditworthiness. Congress has raised the debt ceiling -- the debt limit every time it's been hit, but sometimes with lots of strife.
President Biden, by the way, says he does not support efforts to abolish the debt ceiling altogether.
All right, looking at markets around the world this Monday morning to start the week, you can see Asian shares have closed mixed here. Europe has opened narrowly mixed. And on Wall Street, stock index futures are leaning a little bit lower here coming off their best week since June.
Signs of cooling inflation late last week sent stocks up sharply. The S&P rose more than five percent last week, the Dow up four percent, and the Nasdaq had its best week since March.
Another inflation check Tuesday with the October Producer Price Index. Despite hints of a slowdown, overall inflation still near 40-year highs. It's tough, still, for both businesses and everyday Americans.
We get a check on the health of the U.S. consumer Wednesday with October retail sales.
Meanwhile, gas prices fell slightly overnight, now sitting at $3.77 a gallon.
All right, the FTX crypto exchange is now the focus of a criminal investigation in the Bahamas. That's where it's based. This comes after the company filed for bankruptcy and lost its CEO.
CNN's Brian Todd has details.
(BEGIN VIDEOTAPE)
BRIAN TODD, CNN CORRESPONDENT (voice-over): It wasn't long ago that Sam Bankman-Fried was called the Mark Zuckerberg of crypto -- a modern-day J.P. Morgan. But in the span of a week, the 30-year-old wunderkind founder and CEO of FTX, the mega-powerful cryptocurrency exchange, has resigned. Has lost his fortune. His firm is in bankruptcy. And by Thursday, in a Twitter thread to investors and customers, he was saying, quote, "I'm sorry. I f-ed up and should have done better."
RANA FOROOHAR, GLOBAL BUSINESS COLUMNIST AND ASSOCIATE EDITOR, FINANCIAL TIMES: In some ways, this collapse of FTX is the Lehman brothers moment of the crypto world. It is a classic financial crisis.
TODD (voice-over): At its peak, FTX was worth $32 billion. It has backers like NFL superstar quarterback Tom Brady; his soon-to-be ex- wife supermodel, Gisele Bundchen; and tennis star Naomi Osaka.
But its value has now plummeted. Bankman-Fried's net worth, once over $15 billion, cratered to under $1 billion in a single day, according to the Bloomberg billionaire index.
The NBA's Miami Heat had its venue renamed as FTX Arena just last year, but now that name is coming off the building.
The meteoric collapse of FTX was triggered last week when serious questions were raised about the health of its finances. Those questions ignited a run on the bank-like crisis.
ANGUS BERWICK, INVESTIGATIVE REPORTER, REUTERS: I am suddenly rushed to withdraw several billion dollars worth of cryptocurrency from the exchange that put FTX owner Sam Bankman-Fried in a position whereby he effectively -- he -- his company ran out of money.
TODD (voice-over): Back in July, when he did an interview with CNN Business, Sam Bankman-Fried discussed the danger of Ponzi schemes in the crypto world.
SAM BANKMAN-FRIED, FOUNDER AND CEO, FTX: Because I think that when you have something which is basically an empty product, which I do think is true of some places -- some assets in crypto -- that is something where there is certainly a real crash potential.
TODD (voice-over): FTX's fall has more than a hint of irony. Comedian Larry David did an ad for FTX during this year's Super Bowl, portraying a buffoon who missed the boat on big inventions.
UNIDENTIFIED MALE, SUPER BOWL T.V. AD: I call it the wheel.
[05:50:00]
LARRY DAVID, COMEDIAN: I don't think so. What does it do?
UNIDENTIFIED MALE: It rolls.
DAVID: Yes -- so does a bagel, OK?
TODD (voice-over): At the end of the spot, David's presented with an offer.
UNIDENTIFIED MALE: It's FTX. It's a safe and easy way to get into crypto.
DAVID: I don't think so, and I'm never wrong about this stuff -- never.
TODD (voice-over): Now, analysts are warning about the real future of the cryptocurrency market.
FOROOHAR: I think that the private crypto market, meaning digital coin that is not backed by a central bank, is going to be in for a major correction. I mean, you've already seen that. I think regulators have a great case now to say nobody should be trading this stuff. We need a lot more rules.
TODD (on camera): And now, according to The Wall Street Journal, both the Justice Department and the Securities and Exchange Commission are investigating FTX. And the man who FTX has appointed as its new CEO is John Ray III, who helped managed the notorious energy firm Enron after its collapse in an accounting fraud scandal in 2001.
Brian Todd, CNN, Washington
(END VIDEOTAPE)
ROMANS: A reminder crypto is an unregulated part of the market and you will see regulators stepping in here -- no question.
This week, Elon Musk and Tesla will be in court to defend the compensation plan that helped make him the richest person on the planet. Tesla's board of directors approved the arrangement four years ago. It was valued at more than $50 billion. The plaintiff in the class-action lawsuit on behalf of shareholders claims the huge pay package was unnecessary and that Tesla's board and Musk breached their fiduciary duties.
All right, Presidents Biden and Xi meeting face-to-face right now. We'll hear from the president next on "CNN THIS MORNING." And Democrats keep the Senate. Now, can they come
front behind to hold the House?
(COMMERCIAL)
[05:56:10]
(BEGIN VIDEO CLIP)
Clip from Marvel Studios "Wakanda Forever."
(END VIDEO CLIP)
ROMANS: A big opening weekend for "Wakanda Forever." The "Black Panther" sequel from Marvel taking in around $180 million in North America. That is the best November debut ever. The movie stars Letitia Wright and Angela Bassett. "Black Panther" star Chadwick Boseman, of course, died of cancer.
All right, the Vikings knock off the Bills in what many are calling the best game of the season.
Carolyn Manno has this morning's Bleacher Report. Some good football yesterday.
CAROLYN MANNO, CNN SPORTS CORRESPONDENT: Yes, absolutely. I woke up, got some coffee, and started watching the Seattle-Tampa game. And then this afternoon game was sloppy, and exhilarating, and crazy -- basically, everything that football sports fan would want.
With the second half of the season underway, two of the NFL's best delivering in what was a wild game. The Vikings taking advantage of three turnovers by Josh Allen in the fourth quarter and overtime. So, a little bit sloppy.
The game on the line here on fourth down late in the fourth quarter. Vikings wide receiver Justin Jefferson with a one-handed, game-saving grab that is arguably the catch of the season. He had 10 catches for 193 yards. That play put Minnesota right on the doorstep.
But the Bills' defense answered the call, stopping Kirk Cousins and company on fourth and goal from the half-yard line with 50 seconds to play. So this is where it got interesting on the very next play. Buffalo quarterback Josh Allen fumbles the snap on the QB sneak. Erik Hendricks somehow recovers the ball across the line for a touchdown. That put the Vikings up by three.
So if you thought it was over at that point, you're wrong. Josh Allen made up for that mistake. He marched the Bills up the field on a 5- play 69-yard drive that ended with that Tyler Bass field goal to force overtime. So the Vikings got the ball first. They had to settle for a field goal.
Buffalo with a chance to win it and Josh Allen going for the touchdown. Patrick Peterson coming away with his second interception of the day to seal Minnesota's 33-30 victory.
Allen faltering over these last couple of games. Too many mistakes for Buffalo and a big win for the Vikings who are now 8-1 for the season. The Bills fall to 6-3. They lose the top spot in the AFC East.
(BEGIN VIDEO CLIP)
KEVIN O'CONNELL, MINNESOTA VIKINGS HEAD COACH: I'm going to remember this one forever, guys -- I'm telling you. We just kind of continued to have to trade those blows -- body blows -- you know, haymakers, and just try to be ready for the next snap.
JOSH ALLEN, BUFFALO BILLS QUARTERBACK: Losing sucks. It sucks this way even worse. A horrendous second half. I've got to do better. I've got to be better.
(END VIDEO CLIP)
MANNO: It looked like the Packers were on their way to losing six straight for the first time since 1988, trailing the Cowboys and their former head coach Mike McCarthy by 14 in the fourth quarter. But Aaron Rodgers wasn't done yet. He threw a pair of touchdowns to rookie wide receiver Christian Watson in the final quarter to extend the game into overtime. Watson with three scores on the day.
And after that, Aaron Rodgers leaving a late drive that ended in a game-winning field goal. So, Green Bay stuns Dallas 31-28.
And here is your stat of the day if you are co-workers, if you are around the water cooler, if you're back at the office -- the Cowboys now 195-1, all-time, when leading by 14 points through three quarters.
And much has been made about the Colts' new interim head coach, former NFL center-turned-T.V. analyst. Jeff Saturday taking over the program with no professional coaching experience. But he's starting his tenure with a win and that's tough to do in the NFL. Indy handing the Raiders their third loss in a row -- 25-20 the final there.
All three of those losses coming to teams with losing records, so the Colts within a game of a playoff spot.
A lot of people saying hey, listen, this guy doesn't have any coaching experience past high school. But showing up and made a decision to put Matt Ryan back in, which I think raised a lot of eyebrows, and got a win.
ROMANS: All right. Well, we'll watch him going forward.
Thanks so much. Nice to see you, Carolyn Manno.
And thanks for joining us. I'm Christine Romans. " CNN THIS MORNING" starts right now.
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