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First Move with Julia Chatterley

Terry: This is a Win-Win Situation for Russia, North Korea; Remote Village Hit Hard by Devastating Earthquake; UAW President: Union, Employers Fart Apart as Strike Looms; iPhone 15 Lineup set to be Unveiled; Malpass: World is in a Growth Crisis; Mount Fuji's World Heritage Site Status at Risk. Aired 9-10a ET

Aired September 12, 2023 - 09:00   ET




JULIA CHATTERLEY, CNN HOST, FIRST MOVE: A warm welcome to "First Move" great to be with you this Tuesday and a jam packed show as always beginning

with Kim Jong-Un on the move.

The North Korean Leaders heavily armed trained now in Russia according to state media. Still no confirmed time for the meeting with President

Vladimir Putin as the world of course watches on the latest on that trip coming up.

And catastrophic flooding more than 2000 people have lost their lives in Libya after a powerful storm and heavy rainfall. The fear is that number

could end up significantly higher. A live report on that just ahead too. And the ongoing search for survivors rescuers continue to battle terrain

and the heat following Friday's devastating earthquake in Morocco All the details on those rescue efforts coming up too.

and in the meantime, here's the global stock market picture on Wall Street stock futures pushing lower as investors await Wednesday's U.S. inflation

data the consumer price index are not the only ones Of course, Federal Reserve policymakers will also be watching that number closely. Perhaps

they shouldn't watch so closely. However, in the words of former World Bank President David Malpass, the Federal Reserve's monetary policy is broken.

He says we're missing the true drivers of inflation, which is government policy and regulation. And the focus should be on actually cutting rates to

grow the economy and fixing some of the other things.

We'll discuss some of his solutions later on in the show. And dialing in Apple set to unveil its latest iPhone at its annual event in Cupertino in

just a few hours' time while Google is going on trial in DC charged with violating antitrust laws in its massive search business.

We'll have all the details on that too, and what some of the consequences for Google might be if they lose that case. Lots to get to, as always, but

we do begin in Russia and these images from Russian state media show the North Korean Leader's train in the far east of Russia.

U.S. officials have long warned the talks between Kim and Putin could focus on weapons sales to Moscow after months of war in Ukraine. But here's how

Kremlin Spokesperson Dmitry Peskov described the meeting.


DMITRY PESKOV, KREMLIN SPOKESPERSON: Like with any neighbor, we consider ourselves obligated to establish good mutually beneficial relations. We

will continue to strengthen our friendship.


CHATTERLEY: And we've learned that North Korea's top officials including its top military leaders are among Kim Jong-Un's delegation and that

Russia's Defense Minister will also take part in these meetings.

Joining us now is Sue Mi Terry she's Former CIA Officer and Former Asia Program Director at the Wilson Center fantastic to have you on the show

with us. Is this first and foremost, about weapons and are you expecting some kind of deal on arms to be struck?

SUE MI TERRY, FORMER ASIA PROGRAM DIRECTOR, WILSON CENTER: Absolutely. This is about technology transfer. I'm sure Kim Jong-Un is not going to, you

know Russia and meeting with Putin just for food and fuel, although North Korea desperately needs food and fuel as well.

They are going to get -- Kim Jong-Un is going to get technology for his military satellites for his nuclear submarines for his long range ICBMs.

North Korea has tested -- missiles or ballistic missiles last year.

You know, they are expanding their nuclear and missile program. And he needs nuclear missile technology from Russia. And of course, Putin needs

artillery ammunition. So this is a win-win for Russia and North Korea and loss for the United States and the West.

CHATTERLEY: And we're just sharing pictures just in to CNN of the North Korean Leader Kim Jong-Un arriving in Russia. As you can see there walking

along that green train past a military procession there in salute of him and then up along a red carpet and up the stairs.

And we'll show you that again as we as we play it, but you can see the photographers there welcoming Kim Jong-Un into Russia. Sue Mi just to carry

on with what you were saying there it's not just about weapons.

There are other things but obviously that is at the crux of this relationship. The West, the United States, the National Security Adviser to

the White House, Jake Sullivan warned North Korea that there would be consequences.

What kind of consequences could we be looking at? If you look at both North Korea and Russia, they're both sanction to the hilt. Is that what we're

talking about? If we do see this deal as you presume we will?

TERRY: The problem is and I understand why Jake Sullivan obviously and the Biden Administration will wants to emphasize that there will be

consequences because this is not good news for us.


However, what are the consequences? It's very difficult when both countries are very isolated. The intention behind leaking intelligence about this

meeting last week was to pressure North Korea to not meet with Putin to pressure Kim Jong-Un.

But how can we pressure him when he's already isolated? There are no talks between Washington and Pyongyang and international environment is quite

favorable actually for North Korea in this sense. Kim Jong-Un can act with impunity without any kind of consequences.

Again, there have been some 80 missile tests last year, United Nations Security Council there's no action because China and Russia are refusing to

implement sanctions or to pressure North Korea. So at this point, I'm not certain what kind of consequences that we can really give out to North

Korea, in particular, these countries are both isolated.

Again, you know, I think this is a sign of desperation for Putin to have to rely on North Korea to get arms a pariah states like North Korea and Iran.

But, you know, I just want to see how we can penalize North Korea further. So there's not much we can do to stop this meeting.

CHATTERLEY: Yes, I think the phrase you're looking for is nothing to lose with regards, Kim Jong-Un, and to your point about the isolation for both

of these individuals. I want to hit on the point that you mentioned though, about technology and nuclear weaponry in particular.

Because clearly, I think part of the allure for Kim Jong-Un here is perhaps the provision that will help them with their nuclear weapons program and

the technologies from Russia. The question then is how the Japanese and the Chinese respond to that if there's some kind of deal on that because

clearly, they're not going to be happy. And President Putin is also aware of that fact, too.

TERRY: Of course China, Japan, South Korea, no one's going to be happy about this. Well, at least with Japan, Japan will be working closely with

the United States and South Korea. Biden has already invited President Yoon Suk Yeol of South Korea and Prime Minister of Kishida for trilateral

meeting at Camp David.

So the three countries are working together to, you know, with trilateral exercises and information sharing and Intel sharing and so on. China is an

interesting question how China will act on this, because China is not, I'm sure they're not going to welcome this news.

Also, North Korea traditionally has always played China and Russia off each other. And so if Kim Jong-Un gets closer with Putin, it means North Korea

will be less reliant on China. So China's reaction will be interesting to watch.

CHATTERLEY: And we'll see -- Sui Mi Terry Former CIA Officer and the Former Asia Program Director at the Wilson Center. Thank you so much for joining

us and for your insights.

Now to Libya, and authorities say the more than 2000 people have died after catastrophic flooding, and another 10,000 could be missing according to the

Red Cross. Officials say entire villages were washed away as the equivalent of eight months' worth of rain fell in a single day.

Ben Wedeman has been following this story for us. Ben, we heard from the Head of Libya's Emergency and Ambulance Authority on CNN and they said they

simply didn't anticipate the scale of this disaster and that people weren't evacuated in the path of this water ahead of time. That's part of the

challenge here. People just weren't prepared.

BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPODENT: People weren't prepared because this sort of natural disaster has not happened in Libya in historic

memory. So everyone was taken by surprise by the intensity of this Storm Daniel and as the sort of pictures and accounts is slowly emerging from the

stricken area particularly from the City of Derna.

The situation really is looking grim indeed. In fact, CNN was able to get through to a doctor from Benghazi who made his way to Derna and he says

this, the hospitals in Derna are out of service. There are no emergency services.

People are working randomly at the moment to pick up rotting bodies. Now we've also seen video in fact of what looks like dozens of bodies covered

with blankets and what not littered outside, it appears a hospital and obviously the hospitals aren't working.

The situation is utterly catastrophic in this area. It appears that two dams upstream from Derna burst essentially sending a tsunami through the

middle of the city. Yesterday Julia we heard a spokesman for the Libyan army loyal to the government in the east of the country.


Saying that entire neighborhoods in Derna were simply washed out to see as far as the numbers go, we are hearing from one Health Minister in Eastern

Libya saying that so far, they've been able to identify 700 bodies.

But that's really just the beginning of the emerging death toll. Tamer Ramadan, who's the Head of the International Federation of Red Cross and

Red Crescent Societies, has said that the death toll in his words is huge.

And that we can confirm he said from our independent sources of information, that the number of missing people is hitting 10,000 so far.

Now aid is beginning to reach the area. The government in Western Libya based in Tripoli has dispatched 87 first responders to Benghazi, which is

the capital of the eastern part of the country along with a plane full of body bags.

Turkey, according to President Tayyip Erdogan, is sent three airplanes full of search and rescue personnel, as well as humanitarian supplies. And Italy

today announced that it was sending a team to assess the situation in Eastern Libya in preparation for a larger aid effort. But clearly the real

picture depth of the damage and the loss that has been caused by this storm is only beginning to emerge, Julia.

CHATTERLEY: Yes. Our thoughts with everyone involved there. Ben Wedeman, thank you for that report and new video from Morocco too as rescuers

continuing their urgent work to locate survivors after Friday's devastating earthquake.

So far more than 2900 people have lost their lives in the tragedy, and more are expected in the coming days. Nada Bashir spoke to people in some of the

villages near the quake's epicenter, where residents are losing hope are finding anyone else alive.

NADA BASHIR, CNN REPORTER: This is one of the villages impacted by the earthquake the village of -- - and you can see behind me just how high we

are in the Atlas Mountains. This is a remote village but it has proven easier to get to for rescue workers on the ground.

In other parts of the Atlas Mountains including the village we visited yesterday -- it is proven nearly impossible for rescue workers to reach

those impacts. In fact, when we spoke to residents there, they told us that yesterday was the first day, international rescue teams have made it on the

ground. Take a look.


BASHIR (voice-over): Stone by stone, hour by hour the desperate search for survivors pushes on. The silence in this remote mountainous village,

punctured only by the wails of those who survived now left to mourn.

BASHIR: Well for the rescue team here this really is a race against time. There is a woman and her 12 year old daughter buried beneath the rubble and

for their family waiting anxiously for news of whether they have survived Friday's earthquake. They are quickly losing hope.

BASHIR (voice-over): Rezika (ph) has already buried 19 members of her family. Now she fears she will soon have to bury Hanish Shima (ph). On

Saturday morning, we could still hear her voice she tells me. She was alive now we can't hear her. They took too long to get here. Until now we've been

digging through the rubble with our bare hands. If help had arrived sooner, we could have rescued them in time.

They're small in size. The village of -- was among the hardest hit by the earthquake, the deadliest Morocco has suffered in decades. But three days

on, rescue teams have only just arrived. The high mountainous range simply too remote, the roads up until now still obstructed by debris from the

quake and with time running out, rescuers say this has now become a recovery operation.

SAAD ATTIA, INTERNATIONAL SEARCH AND RESCUE VOLUNTEER: I think that all working, working very hard but till now they don't need adult -- for life.

So they confirmed as all the victims which in this rubble has already passed away.

BASHIR (voice-over): Few lives in this close knit community have been untouched by death. Each body recovered a gut wrenching reminder of the

climbing death toll already in the thousands. It's unclear just how many in this village are still missing. But for those buried beneath the rubble,

just like little Shima (ph) rescuers fear it is already too late.


BASHIR (on camera): International rescue teams are now on the ground in many of these impacted villages. We've been speaking to aid workers on the

ground and they tell us there are still villages across the foothills of the Atlas Mountains that they haven't unable to reach.


CHATTERLEY: Nada Bashir, there with that report. And a historic day in Israel too, for the first time ever, all 15 of its Supreme Court judges are

hearing a case together. They're being asked to decide whether the court has the power to overturn government acts that it considers unreasonable

for Prime Minister Benjamin Netanyahu removing that power is a key part of overhauling the judicial system.

Now, Israelis have been protesting for months over the issue. And critics say Netanyahu is trying to steal power from the courts, and is weakening

Israel's democracy in the process. Hadas Gold joins us now. Hadas just explain to us what's been going both inside of the court but also outside


HADAS GOLD, CNN JERUSALEM CORRESPONDENT: Yes, the hearing in the Supreme Court has been going on now for several hours since 9 am. This could be the

only day of the hearing or could continue for just about one more day

But it's not expected to be a very lengthy trial of sorts. And what they're debating really in this hearing is the Supreme Court's own power. And this

is also sort of a constitutional argument because the law that was passed back in July.

It took away the court's ability to declare government actions as unreasonable saying that they cannot continue. This law amended a basic

law. Now Israel doesn't have a constitution, the basic laws are the closest thing to a constitution so the reason that this was so historic that the

Supreme Court has never before nullified a basic law.

Another interesting aspect of this is that the Attorney General is not arguing, excuse me, the Attorney General is not representing the government

here. And that's because the Attorney General, she believes that this law should be nullified, she does not believe that this law could stand.

So the government is being represented by private counsel. Now, the main argument behind the petitions to take to nullify this law is that it harms

the authority of the judicial scheme. It harms the authority of the judicial branch and deals with severe blow to the essence and existence of

Israel as a democratic state.

And the petitioners are also arguing that the way that this law was pushed through the Israeli parliament was inappropriate essentially. Now the

government is saying this is Supreme Court does not have the power to take away or to change basic laws and saying that that power rests in the hands

of the people in the hands of the Israeli parliament.

Now, what's been interesting is to hear the judge's response to hear the judge's commentary, it's always difficult to try to ascertain how the

judges rule just because of their comments during a trial. But you're bringing up some interesting points.

They're saying OK, if the Supreme Court does not have the power that it rests in the power of the people and the power of the parliament, what

happens if the government decides that there should not be elections for 10 years?

What will be the check on that sort of power? And what's also really interesting is another comment from one of the justices saying, and I'll

quote here, democracy dies in a series of small steps.

Now, the crux of what the Supreme Court is trying to decide is how to ensure the government acts as the -- what they call reasonably if the

judges are prevented from using this standard in the rulings because Julia here in Israel in the parliamentary system, essentially the only check on

the government on the executive on the parliament, is the Supreme Court.

And so the question is, if the Supreme Court is not able to use one of their tools in the bucket to declare government actions unreasonable to

prevent the government from taking any sort of action, where will that checks and balance lies?

And that's why you hear that question about them saying, OK, if the parliament passes the law saying there can't be elections for 10 years,

where will be that checks on the power because the people won't have that election again. Now, there will not be a decision on this in you know, in

the near future, they have a deadline by January 12th.

But that could be setting Israel up for essentially a constitutional crisis, because there is still even a question about whether this

government will abide by a Supreme Court ruling nullifying this law. So there could be a major judicial and constitutional clash, Julia.

CHATTERLEY: Yes, it's brilliantly explained. And it's very complicated. But I think the point is where does the government's power end without the

ability of the Supreme Court to weigh in on these things? The quote was important democracy dies in a number of small steps. Hadas well battled

with the cough as well. We could see you see you struggling, that's a pro. Hadas Gold thank you for that!

OK, straight ahead, well, America's major automakers hit the brakes and avoided strike powerful enough to dent the U.S. economy. We're live in

Detroit next. Plus, a collision course of a different kind Former World Bank President David Malpass is here on pulling no punches, taking aim at

what he calls broken Federal Reserve policy. That's later stay with us.



CHATTERLEY: Welcome back to "First Move" and feeling the pressure America's Big three automakers Ford, GM and Chrysler's parent company Stellantis are

trying to resolve a labor dispute that could deliver a multibillion dollar blow to the U.S. economy. If no deal is found almost 150,000 workers could

be on strike as early as Friday this week.

And last week, members of the UAW were preparing to man the picket lines. Omar Jimenez is in Detroit where he's been hearing the union side of the

story. Omar right, I saw the chief actually on with Jake Tapper yesterday and he said the only people that will be hurt by a strike is the

billionaire class and I quote. But just what are some of the sticking points in these negotiations from the union's perspective?

OMAR JIMENEZ, CNN CORRESPONDENT: That's right, Julia. We've been talking to union members and some of those major sticking points are over higher

wages, cost of living adjustments, pensions, return of retiree health care, things that workers say would make their jobs fair, given the amount that

is expected from them.

Now the automakers insist they want to reach a deal without a strike avoiding what happened in 2019, when the union went on a six week strike.

But union workers say they only made incremental progress that time around this time. They don't want just incremental progress.


JIMENEZ: This fight feels different.


JIMENEZ: Why is that?

DAVIS: Because there's more at stake. We don't want to strike. But you leave in us no choice, if you don't give us a fair contract.

UNIDENTIFIED MALE: We are the union.

JIMENEZ (voice-over): It's what's on the minds of nearly 150,000 United Auto Workers who are days away from a potential strike.

UNIDENTIFIED MALE: What do we want?


UNIDENTIFIED MALE: When we want it?

JIMENEZ (voice-over): Once they work through negotiations, they say the world's got more expensive, but their wages got left behind.

RENE'E DIXON, GUIDE OF UAW LOCAL 22: People who aspire to be part of the automotive workforce. I can remember the last time I went to the grocery

store and was able to fill my cupboard and my refrigerator.

JIMENEZ (voice-over): Rene'e Dixon says even with 12 hour shifts, she sometimes has to work a second job just to keep up.

DIXON: I don't think I should have to do that. If the pay rate and you know, everything stays the same. There's no path and it's just going to

fall further and further back.

JIMENEZ (voice-over): It's why the union is pushing in part for at least a 40 percent raise over four years cost of living adjustments or return of

traditional pension plans and retiree health care and more. But the union and Big Three automakers for General Motors in Stellantis are very far

apart on it all.


SHAWN FAIN, PRESIDENT OF UNITED AUTO WORKERS: Still slow, but we're moving. So you know we have a long way to go.

JIMENEZ (voice-over): Meanwhile, the countdown has gone from weeks to days. One analysis as a 10 day strike on all three automakers, for example, would

cost the U.S. economy more than $5 billion. But union leadership sees this fight as bigger than all of that, especially as GM saw record profit last

year, and Ford saw near record profit.

FAIN: The talking heads, the pundits, the companies want to say that, you know, if we strike, it can wreck the economy. It's not that we're going to

wreck the economy. We're going to wreck very economy, the economy that only works for the billionaire class it doesn't work for the working class.

RANDY SANDUSKY, RETIRED WORKERS' CHAPTER CHAIR OF UAW LOCAL 22: I was able to raise a family in the auto industry. And it was a different industry

than it is today.

JIMENEZ (voice-over): Randy Sandusky retired in 2005, after working in the auto industry for decades, part of what's been lost in recent years is

retiree health care for those hires and so seven, their benefits he knows can be crucial.

SANDUSKY: I know some that are crippled, I can hardly walk and stuff I used to build handicap ramps for him to get in and out. They're out. And they're

all retired from General Motors and they don't get a lot, you know, just the sad.

JIMENEZ (voice-over): It's part of why workers now hope to make more than just incremental progress.

DIXON: I'm raising my family, I'm doing it. I'm not I'm not crying, but I'm not able to do what I should be able to do whatever is going to happen. I

know that our membership is not going to back down.

DAVIS: It's time for the average worker to be appreciated, because if you're more happy. You're willing to do anything to make the job work. And

when you feel appreciated, that's priceless.


JIMENEZ (on camera): Now one of the points the workers in the Union stress is that back between 2007 and 2009 as Chrysler and GM headed toward

bankruptcy and federal bailouts. Workers made concessions to keep the companies afloat in part and to keep their jobs.

And they say that they haven't gotten some of those concessions back specifically retiree health care for new hires and the pension plans and so

talking to one of the workers they said we scratch their back and now it's time for them to scratch ours.

CHATTERLEY: Yes, you can understand it with the billions of dollars that they're pushing into transitioning to cars of the future a hybrid electric

vehicles the like hey, isn't there a bit of money here for us too world sake. Omar, great to have you with us thank you. OK, still to come

searching for a solution the U.S. government tackling Google in the biggest anti-monopoly case in decades, the details next.


CHATTERLEY: Welcome back to "First Move", Google may soon find itself searching for solutions. It's facing the U.S. government and more in a

legal showdown. That could mean weeks spent in court, the Justice Department and dozens of states accusing the search giant of abusing its

dominance by harming competition.

The trial could reshape what is one of the Internet's most dominant platforms. Anna Stewart is live and on the story for us. Just spell it out

for his good because it is the biggest case for the U.S. government and the tech sector since Microsoft was tackled back in the late 1990s. What's

Google standing accused of? And what's the defense?

ANNA STEWART, CNN REPORTER: So at the heart of this, it's all about the search engine. And the DOJ says Google accounts for nearly 90 percent of

all general search engine queries in the United States. I don't think that would surprise anyone at all. But the big question is has Google unlawfully

gained that dominance and a huge focus of this lawsuit?

Or the lucrative deals that Google has struck with smartphone makers like Apple, browser developers, like Mozilla wireless carriers to make Google

the default search engine. So when you buy a phone, it's what's just naturally on that phone. It's easier, of course, to opt in than it is to

opt out.

Now Google, of course, argues its business practices are legal, that they are commonplace, and that quite simply its search engine is the preferred

option for so many people. Now, what happens in terms of the results of this case will have a huge bearing on Google.

Just to give you an idea, its search business provides more than half of Alphabet's revenue. So what happens if it loses the case will be a very

interesting result.

CHATTERLEY: And what happens if they do, Anna, because if we go back in time, again, to the Microsoft case, the result was look, the view that they

had to be broken up, they then challenged it the decision then was severe restrictions. What might happen if they lose?

STEWART: I mean it's a really good question. You and I, of course, are far too young to remember the Microsoft case in the late 90s, early naughtiest.

But yes, they tried to restructure the business. That's what the government wanted. But that was overturned. I think in this case, the DOJ obviously

could go for a big fine, I don't think that's what they want.

They could go for a restructure, or they could simply go for some sort of way to stop Google from abusing what they may perceive to be dominance in

the search engine, if, of course, they win that lawsuit. So there are a few options there. They all would have a big bearing, though, on Google, how it

does business and potentially its revenue. So really, in Google's interest over the next 10 weeks, it's going to be a long trial, to argue a good


CHATTERLEY: Yes, the DOJ has to prove consumer harm. That's the key. And I have to say, anecdotally, I find myself on other search engines and they

get furious with my-self and they do go back to Google. But one of the comments that I picked out which I really loved the Google President of

Global Affairs.

This is a backward looking case at a time of unprecedented innovation, including breakthroughs in AI, new apps and new services, all of which are

creating more competition. That's an interesting argument too. Not quite sure how you prove it. Anna Stewart, we'll see. Thank you for that.

Apple is set to launch its iPhone 15 lineup in less than four hours is expected to unveil the biggest change to the phone's design in more than a

decade, including a USB-C charging port. Apple has titled this year's event in Cupertino wonder lost. Clare Duffy joins us now. As exciting as I am by

quicker, more sophisticated charging, it's not that bigger deal, surely.

CLARE DUFFY, CNN BUSINESS WRITER: Yes, Apple will have to roll out some additional updates.


DUFFY: And additional feature announcements for this iPhone 15 lineup if it wants people to upgrade and this is a really crucial sort of Crux for Apple

right now. The company's sales have fallen in the last three consecutive quarters because people just aren't upgrading their mobile devices as



So Apple is going to have to announce some other things we may see some of the more typical things like color changes potentially a price hike. But

this update to the USB-C charger would be really significant. It means that for consumers like me, I've got a phone for personal use and a phone for

work use.

And potentially my Android and my iPhone could be using the same charger, which would be at you know, a significant convenience for people and

potentially really a reason to upgrade to this new iPhone 15. We may also see things like the next generation air pods and Apple Watch in this


And I think the other major thing I'll be watching for today is whether we get any updates about this vision Pro headset, this is the headset that

Apple unveiled earlier this year that will combine virtual reality and augmented reality. And it's expected to launch early next year.

And so Apple may use today's event as an opportunity to tease the more features potentially announced a specific launch date and sort of drum up

excitement ahead of that product launch next year.

CHATTERLEY: OK, I was listening, but my head just exploded when you held up those two phones and you've got an Android phone and you have an Apple

phone and you managed to do the two and not go crazy trying to adjust for screens.

DUFFY: Yes, but I would I would like to not have to pack two different charges when I go on vacation.


DUFFY: So you know I'm looking forward to this update.

CHATTERLEY: I'm just a captive audience. Unfortunately, you're the one out there that can manage both. Clare Duffy, thank you so much for that. Now

after the break rising rates is not the answer to rising prices and risks more economic pain. So says the Former World Bank President David Malpass

who's speaking out against Fed policy on inflation, that's next.

CHATTERLEY: Welcome back to "First Move", monetary policy at the U.S. Federal Reserve is "Broken". And then there's the sound of silence over

what's actually driving inflation today. That's the warning from David Malpass, who stepped down as the President of the World Bank Group in June.

In his latest op-ed in today's Wall Street Journal, he pulled their punches in his assessment of the Fed, led by Jerome Powell describing the Central

Bank's inflation model that is used to justify rate hikes is antiquated when the real drivers of inflation he says government policy and regulation

and all we're really doing today is putting growth at risk.


The solution he says is a government commitment to a strong U.S. dollar and that of course is critical to price stability. Also allowing dynamic

business investment aka improves regulations on things like bank lending. And finally, don't be silent about excess government spending and debt.

And I'm pleased to say David, joins us now. David, oh, as always, we have much to discuss. Welcome to the show. I do want to start with this op-ed,

because I do like it. The two immediate risks to inflation are, I think fuel prices, and wage prices. And the premise of your op-ed is saying,

look, these are the remit of government.

Whether it's regulation on MSC energy policy that's pushing up prices, longer term, or social security payments that mean that there's fewer

workers than we need in the workplace. This is a problem and it's not the Feds.

DAVID MALPASS, FORMER PRESIDENT OF WORLD BANK GROUP: Hi, Julia, that that's right. The Feds already hiked by 5.5 percent. And so if that's not enough,

it may be that that's not the only tool that should be used. So the point here is to recognize that if you just keep hiking rates, you're going to

hurt production more than consumption.

And that's going to only add to inflation. That's especially true because the government is one of the big parts of the economy, and they're

indifferent to interest rates, you could go to 10 percent. And it wouldn't stop the government from spending. So shouldn't there be a more direct

focus on the things going on in the economy that are undercutting the productive side of the economy.

CHATTERLEY: Yes, and this is a key, I mean, you point out, and you caught my attention with this, that we're applauding the resilience of the U.S.

economy at 2.1 percent GDP. But actually, that's weak by historical standards, and it's propped up by, to your point government spending excess

debt levels.

And that does nothing to improve future growth or boost our productivity. And actually, the Federal Reserve is an enabler of that by buying up lots

of government debt.

MALPASS: That's why for 10 years, now they had the rates at zero, it didn't cause inflation. So you wonder about, do they really think there's that

much connection between their rates and inflation? And in the meantime, they were holding down the yield curve really intervening heavily in


That these are not small numbers, they ended up with a peak of $9 trillion of bonds. So it massively adjusted the world towards activities that are

funded by people issuing bonds, that means big governments, big corporations, and that slowed the world growth.

So we have this decade, already more than a decade of slow average growth. And so there has to be a thinking that we have to break to a much faster

growth plane from the U.S. And then that can help the whole world lift off of the crisis that it's in. It's in a growth crisis, that is really hurting

people around the world. So I think we have to try new tools.

CHATTERLEY: Yes, I want to come to the rest of the world, because you and I feel very passionately about this. But the final point, because I know

people reading this article, as I did, will be thinking about this too the three steps that I mentioned and we can show them once again.

You say the Fed could elicit an immediate improvement in inflation expectations and in growth by sort of signaling in terms of policy that

would lead to rate cuts a stable dollar and smaller Central Bank, or government bond holdings by the Central Bank it all sounds great in theory.

But in practice, David, how do you do that without inciting some form of panic to your point? We're a decade in now at least, it's what we've come

to expect, what investors have come to expect?

MALPASS: I think there would be a balance between the prospects of shorter term interest rates going down, but the Fed owning less of the long term

bond portfolio, from the standpoint of the amount of money in the economy, it would be the same, but it would be shifted toward more growth uses.

Commercial Banks wouldn't have to be lending so much to the Fed, you know, the Feds paying top dollar for giant amounts of money that they borrow out

of banks and money market funds, that would be returned gradually to those entities for making loans, business loans, commercial and investment loans

that are, I'm sorry, commercial and industrial loans that are so important to small businesses.

And so that businesses look ahead. So they would immediately get the point and say, aha, we're going into a growth phase that includes lower interest

rates. And so I'm going to make investments that pay off quickly, and it helps the rest of the world in the same way.

CHATTERLEY: Yes, it's a vital point and we need to keep discussing it. Let's talk about the rest of the world, David, because we are have been in

a dramatic rate rising environment and that's exacerbated the pressure that's been faced by some of the poorest nations in the world.


And those least able to afford it at a time as we discuss often on this show, big steps need to be taken towards things like climate change and

society security. You are at the forefront of debt negotiations of trying to give some breathing room to some of the poorest nations at the head of

the World Bank. Where are those debt negotiations today, David?

MALPASS: Unfortunately, I think they're still stalled. These are difficult issues. But what I found in six years at the U.S. Treasury and then at the

World Bank, was that the forces that be, in the world don't really want to change the system. One of the things going on is, as the international

institutions put more money into countries, it almost all goes to the creditors.

So from the standpoint of world moneymakers, they really like the current system where they make loans, they earn interest. And then if the loans go

bad, they get bailed out by a multilateral system. The problem is the people of the countries are left in bad straits, because they have to be

the conduit.

The farmers have to work extra hard, in order to pay extra money, in order to pay for the debt that was taken on years before. Let me take a moment to

express condolences to people in Morocco, but also around the world. You know, in Libya, they're having flooding 2000 people dead that they know of


And it's feared to go more, but the victims of 9/11 were in yesterday's thoughts and minds in the in the U.S. of the Maui fires, and of the

Afghanistan evacuation that still is causing trauma and difficulties for millions and millions of people.

And so I think we have to think about the very difficult lives that are being led in much of the developing world, in part because that their

governments don't have good policies to allow businesses to actually operate MIT women to be in the workforce, children and girls to be


And so those are, I think, pressing global points and made worse now by the interest rate increases that are coming across the world. That was

inevitable, but they're left with floating rate debt, and no way to restructure it. Zambia still doesn't have an MOU.


MALPASS: In Ghana, they haven't made progress on defining the universe that has to be included in the debt restructuring. Chad supposedly had the

common framework success, but there was no debt restructuring. So the people of Chad weren't benefited at all by the efforts of the international


CHATTERLEY: Yes, I mean, David, you've just given us a global tour. And I know, at the head of the World Bank, you are at the heart of these

discussions and understanding I think the suffering of people on the ground and the complications to your point, I think you called it the forces that

be, the powers that be, that have vested interests that don't want things to change.

David, how do we break that? Whether it's the United States, whether it's the private sector, whether it's China, as the biggest creditors in the

world? How do we bring them to the table and say, actually, this is one world and whether it's climate mitigation or social stability, rather than

wars, breaking out. And conflict and migration, we all have to be part of the solution here. How do we do that? How do we get there?

MALPASS: I think individual countries have to lead and really push initiatives. We just saw the G 20 meeting in India. And they there is talk

about one world but I have the impression that what people want to do is make lofty promises, but not actually spend money or make the changes that

are needed in order to get the adjustments going on.

On the debt one, I advocated in Japan at the two meetings of the G7 in Niigata, in Hiroshima, that the G7 ask the IMF and the World Bank to really

make progress on debt. They didn't do it. It's part of the G 20 process. It's moving very, very slowly, in fact, not moving.

And so I think this is a problem of the world kind of wanting to look at someone else and say they should solve this problem when it has to really

be self-selected by important by countries that can really have an impact and then for them to focus on it and get to a solution.

CHATTERLEY: Yes, if not us, who? David, keep fighting the fight, please. We will continue to have these conversations and try and help some of these

institutions accountable along with it.


Great to chat to you sir, we'll speak again soon.

MALPASS: Thanks Julia.

CHATTERLEY: Thank you, David Malpass there. OK, still to come one of Japan's most iconic attractions under threat, as tourists and hikers put

Mount Fuji is World Heritage status at risk, that's next.


CHATTERLEY: Welcome back to "First Move", the climbing season has ended on Japan's iconic Mount Fuji giving the UNESCO World Heritage Site a much

needed break. The number of visitors has skyrocketed in recent years. But as Kristie Lu Stout explains, the surge in tourism could cost the mountain

its World Heritage status.


KRISTIE LU STOUT, CNN INTERNATIONAL CORRESPONDENT (voice-over): Human traffic jams on sacred Mount Fuji.

UNIDENTIFIED MALE: Very cool that just like a traffic jam.

STOUT (voice-over): An ambulance on route to an injured hiker litter on the mountain side, it decided to Japan's popular tourist site that is not in

the guidebooks before Mount Fuji Ranger Miho Sakurai it's just another day on the job.

MIHO SAKURAI, MOUNT FUJI RANGER: There are definitely too many people on Mount Fuji at the moment. The numbers are much higher than before.

STOUT (voice-over): Famous for its snowcap volcano, Mount Fuji has inspired artists and been a pilgrimage site for centuries. Less than two hours away

from Tokyo, Japan's highest peak attracts visitors globally and in 2013 became a UNESCO World Heritage site over tourism has become a big problem.

This year, a post COVID tourism boom has brought thousands more hikers to Mount Fuji. According to a Yamanashi Prefectural Government official, the

environmental damage being done could cost Mount Fuji its heritage status, according to the local government.

MASATAKE IZUMI, YAMANASHI PREFECTURAL GOVERNMENT OFFICIAL: Fuji san is screaming out in pain. We can't just wait for improvement. We need to

tackle over tourism now.

STOUT (voice-over): Volunteers take away tons of trash each year. Climbers urge to donate $7 to help keep the mountain clean, but not everyone pays

up. As Sakurai says some behavior is even harder to control.

SAKURAI: People of all experience levels come here including first timers. We want to prevent accidents, so we give them advice.

STOUT (voice-over): The risk of altitude sickness and hypothermia has been increased by a trend called bullet climbing where hikers begin their ascent

at night, pushing on until dawn according to the Yamanashi Tourism Board.

According to the local government, they start their hike from a place called Fuji's fifth station, where the number of climbers arriving here

from Tokyo has more than doubled between 2012 and 2019. The local government also says it wants to shift from quantity to quality tourism.


It says replacing the main road to Fuji with a light rail system would be a more sustainable solution.

SAKURAI: I'd be devastated if Mount Fuji's World Heritage status was taken away. I wanted to have that status forever, so we'll do our best to keep it

that way.

STOUT (voice-over): But with no easy fix in sight, Sakurai will keep doing her best to protect the mountain she loves. Kristie Lu Stout, CNN, Hong



CHATTERLEY: And finally on "First Move", an American astronaut has set a new record for time in space. And he did it by accident. Frank Rubio is in

his 356 day aboard the International Space Station the longest any U.S. astronaut has spent in Earth orbit, but it actually wasn't supposed to be

this way.

He was slated to return to Earth in March. But the Russian spacecraft that was meant to take him home sprung a coolant leak so he stayed and stayed

and stayed. And now he's got a ticket to ride home later this month after a total of 371 days in space, fingers crossed. That's it for the show.

"Connect the World" is up next. I'll see you tomorrow.