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Quest Means Business
Supreme Court Allows Part of Travel Ban to Go Ahead; Prime Minister Modi of India Goes to Washington; Italian Bank Rescue Sparks Criticism; Takata File for Bankruptcy After Airbag Recall Scandal; CBO Reveals Cost of Senate Republicans' New Health Care Plan. Aired 4-5p ET
Aired June 26, 2017 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:00] ZAIN ASHER, CNN ANCHOR: And that sound, my friends, marks the end of yet another trading day on Wall Street. You can see State Street
there ringing the closing bell. Let me just show you how the markets did. It started off solidly in the green, we had a little dip there around
11:00. Then it recovered, but not quite as much. The market ended the day pretty much flat, up about 16 points or so. The focus was really on
volatile oil prices and also on tech shares particularly on the NASDAQ were a bit of a drag as well.
My friends, it is Monday the 26th of June. Tonight, the ban is back. The U.S. Supreme Court says parts of Donald Trump's travel ban can go into
effect.
"Made In India" meets "American First." Prime Minister Modi sits down with the U.S. President this hour. And an Italian bank bailout sparks a
backlash around Brussels.
Hello everyone, I'm Zain Asher and this is QUEST MEANS BUSINESS.
All right, welcome everyone. I'm Zain Asher. Some major news to report to you, though we've been getting drib and drabs on throughout the day.
Tonight, the U.S. Supreme Court rules that parts of President Trump's travel ban actually can go into effect. That parts of his travel ban
actually can go into effect. Mr. Trump calls that decision a victory for national security. He's clearly happy about it.
His vindication, though, could be short-lived. The court will give oral argument on this ban later on this year. In the mean, the ruling bars
people from six majority Muslin countries from entering for 90 days. The president's revised travel ban, it was originally back in January 7, and
then they removed Iraq. It's now six. It's Iran, Libya, Somalia, Sudan, Syria and Yemen. But the ruling excludes travelers who have bonified
relationships with U.S. entities. So that means those people who have close family relationships in the U.S., students who have been accepted
into American universities or employees who actually have legitimate bona fide job offers with American companies. Those people will be exempt from
this travel ban.
The order could take effect in as little as three days. Legal analysis could actually warn that it could cause chaos with decisions about what
exactly constitutes a bona fide relationship or not. That decision will be left to officials. The three most conservative justices warned that this
is unworkable. This compromise is unworkable. That is what they're saying. In a dissent, they argued that the full ban should be allowed to
going affect. Laura Jarrett is CNN's U.S. justice correspondent. She is tracking the latest developments from Washington. So, Laura, we want to be
clear on this. Because we have viewers from all around the world. What do travelers actually need to know about the parts of the travel ban that will
be put into effect? Just walk us through that.
LAURA JARRETT, CNN U.S. JUSTICE REPORTER: The key language you hit on, Zain, is whether a traveler can show they have a bona fide relationship
with either a person in the U.S. or an entity. So, take for example, if somebody is in one of those predominantly Muslin countries, one of those
six countries, but then they have a family member living in the U.S., like a brother or sister or wife, then they can come to U.S. But if they have
no connection to the United States whatsoever, never traveled here, never had a green card, doesn't have a visa, has no connection whatsoever. Then
the travel ban will go into effect for that person. And they will have trouble getting into the country, Zain.
But the key question is what happens if somebody on the line or there's a question? Or what happens if there's a refugee who has been tentatively
admitted to the United States but isn't here yet but tentatively approved? So, there's lot of open questions that as some members of the Court and
even other experts have even pointed out, there are open questions yet to be resolved here.
ASHER: So, Laura, you and I both remember that in 2015 Donald Trump called for a total and complete shutdown of Muslins entering the United States.
Just looking back at his campaign rhetoric, how much concern was there among the U.S. justices that, you know, there was an element of religious
discrimination in all this?
JARRETT: Well, it's interesting. The Supreme Court really has sort of sidestepped some of those more interesting deeper constitution questions
for now. Probably saving those for a later date when they hear the full case this fall. But as you pointed out, the lower courts were really
concerned with what Donald Trump said on the campaign trail. Because they said, well, wait a minute we can't separate what he said on the campaign
from now this policy that he's done as president. And we think given what he's said on the campaign, it's sort of infected the entire order with some
sort of religious animus, that's not permissible.
[16:05:03] But the Supreme Court avoided all of those issues today and simply looked at this narrow issue about what your connection is to the
U.S. So, I think we will likely see his campaign statements come up once again when the full-court takes up the case this fall.
ASHER: All right, that will be in October. Laura Jarrett, live for us there. Thank you so much. Appreciate that.
JARRETT: Thanks.
ASHER: Let's talk about reaction to this partial travel ban now. Chieh Huang is the CEO of Boxed. A company that ships household good in bulk to
you front door. He joins me now from the company's warehouse in New Jersey. So, Chieh, thank you so much for being with us. When you look at
the tone of immigration policy in the U.S. over the past six months, what will it mean do you think for American businesses especially yours?
CHIEH HUANG, CEO, BOXED: I think we'll see a definite shift in not only kind of hiring practices, especially out in Silicon Valley, but also the
need like companies like ours to really try to drive forward the need for us to have kind of a balanced approach. I mean, you look at what's
happening. I think part of the reason why the country is so split apart is because the views have gotten so extreme. Whether it's like a total band
or no ban at all.
No one is debating that we definitely need safety in the country. But if you look at just the foundation that immigrants from Europe, immigrants
from Asia, immigrants from all over the world have brought to this country, we just can't exclude them going forward because they are part of the
foundation that have made us so strong. And frankly, probably the reason why so many folks outside the country hate us. It's because we are so
strong and generally so united.
ASHER: And that brings me to my next point and that is your own personal background. Having the background of, A, a successful entrepreneur and an
immigrant yourself, what message do you want to send to people who actually support this partial travel ban?
HUANG: So, I want to say to everyone out there that definitely realize that this country, it's just a matter of time, but we're all kind of
immigrants into this country. And yes, there is a need to maintain safety. But at the same time, we need to consider all the good things folks from
all around the world can bring here. At the end of the day if we keep excluding folks more and more across the world, there could be a day where
we lose our dominance. That we lose our strength as a country because we've excluded the best and brightest across the world. And when that day
comes, it'll be a day when no one even wants to come here because we're no longer leaders of the world. I think we're still far off from that day.
But given the opposing and extreme opposing views from both sides of the aisles, it's worrisome to say the least for entrepreneurs like us.
ASHER: So, as you know, Donald Trump's priorities have been hire American, buy American, that sort of thing. I mean, how does the U.S. government
address the skills gap we're seeing from American potential employees especially in the tech sector?
HUANG: It's really important. I loved how you mentioned it, Zain, because I think everyone's talking about domestic workers or foreign workers. As
much as we'll need certain folks to come in, via H1Bs, because there's an immediate need for certain folks. At the same time, I don't think the
government has done a great job in promoting education amongst those folks that actually could do some of the jobs.
For example, some of the folks that work on the robotics that you see behind us, they were actually pickers doing an unskilled manual job three
years ago without the right education, without going to school for computer science. Without getting those loans to be able to educate themselves,
there's no way we would even know that that people was qualified to do what they do. At the same time though, you do have short-term concerns.
Because we have high technology companies that actually need help now. And that we can't wait three or four years. Because if we waited three or four
years that opportunity, that business opportunity and the jobs that come with the opportunity, will actually go overseas rather than be here in the
United States.
ASHER: All right, Chieh Huang, thank you so much for bringing your personal perspective to us. Appreciate that.
Indian Prime Minister, Narendra Modi, has just arrived at the White House. It is his first meeting with the U.S. President, Donald Trump, and the two
are hoping to build on a recent warming in relations in the past few years. High on the agenda will be trade, the conflict in Afghanistan and
immigration, especially as it relates to the Silicon Valley. You just heard from a tech CEO just there a second ago.
Prime Minister Modi, met with top U.S. tech executives on Sunday including the heads of Amazon, Apple, Google, ahead of his meeting with President
Trump. The two leaders -- you might not believe it, but these two leaders actually have quite a bit in common. They lead the world's largest
democracies. They both want to boost their countries manufacturing industries. Modi with a program called "Make In India."
[16:10:00] And Trump with his "America First" agenda. And "The New York Time" dubbed him the social media politician. But, get this, they weren't
talking about Trump. Both leaders have used Twitter to bypass traditional media and speak directly to the people, directly to voters. Other than the
Pope, Trump and Modi are actually the two most followed leaders on Twitter. And that brings me to my guest. Ravi Agrawal joins us live now here on
set. Good to have you on set.
RAVI AGRAWAL, CNN NEW DELHI BUREAU CHIEF: Great to be here.
ASHER: India, of course, is one of the world's fastest growing economies. I mentioned the two leader similarities, but they do have a lot that they
disagree on. What's going to be Mr. Modi's priorities, do you think?
AGRAWAL: The first of all, I mean, there are a lot of issues, some of them are good, some of them are thorny. But the first thing that Mr. Modi is
going to try to do is get off on the right foot. He had a great relationship with President Obama, and it was their hugs and their
handshakes. And in the Indian media were seen as a romance, and that is symbolism. But a lot of it does filter down into good relationships and
good policy as well. Because both countries feed off of that, their delegates feed off of those messages. So, the first thing Prime Minister
Modi is going to try to do is make sure that he gets off on the right foot with President Trump. That they establish a rapport. They establish some
chemistry. This is their first meeting.
ASHER: Right.
AGRAWAL: The other thing is that Prime Minister Modi is going to try to sell his vision of what India wants and try to understand what President
Trump wants from India. This is a president who doesn't really have a clear vision about India. He hasn't said anything about India on the
campaign trail. Contrast that with Obama who made it very clear --
Ravi, I have to interrupt you because President Trump is speaking. Let's listen in.
DONALD TRUMP, U.S. PRESIDENT: -- you're such a great Prime Minister. I've been speaking about you and reading about you. And you have done a great
job economically. India is doing very well and so many other ways. So, I'd like to congratulate you. I'd like to congratulate you very much.
NARENDRA MODI, INDIAN PRIME MINISTER: Thank you.
TRUMP: Thank you. Do you want to say something?
ASHER: Sorry, we don't have translation there, but Prime Minister Modi and President Donald Trump speaking at the White House. You saw a handshake of
the two men. President Trump seemed very sort of welcoming, sort of very open with him. Just in terms of what Mr. Modi's objectives are -- you
mentioned they, of course, have to get off on the right foot, of course. But Modi is under some pressure, I believe, back home to stand up to
President Trump especially when it comes to some of the anti-immigration rhetoric. And especially given how much India depends on H1B visas.
AGRAWAL: Yes, exactly. Mr. Modi has been very clear on two fronts. One, that the Indian workers who are coming to the United States on the H1B
visas -- the highly skilled visa program. His point is that these are deserving workers who are coming here and improving the state of the
American economy. Not only that, the businesses like Infosys, the other tech companies, even tech companies that use up these visas, they're
creating jobs for Americans. Infosys, which eats up the highest number of H1B visas, just promised to create 10,000 jobs for American workers two
months ago.
So, that is what Mr. Modi is going to present to Donald Trump. He's going to say that you want to create jobs, well we are job creators. That is
going to be his message on that front. And he's going to try to hope that any reform that president Trump would want to bring to the immigration law
would still be in India's favor without shutting out the Indian IT industry.
ASHER: It's interesting because -- I agree with what you said, but they do have similarities but also -- my question to you is do their similarities
overlap? Can Prime Minister Modi his focus is on "Make In India." President Trump is "America First." Can those two goals exist
simultaneously side by side, hand in hand even?
AGRAWAL: Well, it depends how much of that is rhetoric and how much of it is reality. So, with Prime Minister Modi one of his objectives is to get
American companies to come to India and create jobs there as well. But what he's going to say again --
ASHER: There's been some red tape though.
AGRAWAL: Right, there has been some red tape which he says he's claiming that he's making it easier. But I think the message he's going to bring to
President Trump is that it's not a zero-sum game. You can create jobs in another place while still boosting the economy of the other. That has
trickle-down effects. I think that's the message he's going to try and take to President Trump. There's no given that he's going to listen to
that message or act on that message.
ASHER: Of course not, but Ravi, we have to leave it there. Thank you so much, appreciate that.
Italy is hoping to avoid a fresh crisis in its financial sector by bailing out to regional banks. The controversial bail has a $19 billion price tag
and could provide a loophole in new EU bank bail rules. We'll have more on that next.
[16:15:00] (COMMERCIAL BREAK)
ASHER: Welcome back, everybody. A multibillion dollar bank rescue in Italy is sparking controversy across Europe. The Italian government or
help save the best assets of two regional banks. There are $19 billion bailout. State involvement means the taxpayer will be footing the bill.
In Brussels, the European Commission has given Italy the green light despite EU rules that require investors to pay for rescue. In Germany,
some politicians have spoken out against the move. They think that failing banks should not rely on state aid. Earlier I spoke to the chief
strategist from NN Investment Partners. He told me that the bank rescue shows that when the comes to fixing problems Europe will always find a way.
Take a look.
(BEGIN VIDEOTAPE)
VALENTIJN VAN NIEUWENHUIJZEN, CHIEF STRATEGIST, NN INVESTMENT PARTNERS: Well, I think what you're actually seeing, although it might not be
literally compliant with every detail of the new rules that we agreed upon not too long ago, is that in the end-all the European problems find some
kind of pragmatic solution. With takes into account first and foremost the political angle, that's why it took so long. And eventually has a way to
deal with the formal rules. Yes, and that's how they came up with this. Eventually this needed to be dealt with. On a macro scale, it's a small
issue. But the political and the political cloud was very big, and needed to go.
ASHER: And the fact that Italy, the ruling party of Italy, has elections next year, is that something you believed weighed in on this decision as
well, do you think?
VAN NIEUWENHUIJZEN: Well, obviously it played a role in terms of the willingness of the Italians to solve this, but I think the key factor here
is as well is that there is a sense in Brussels, at the ECB, at the broader European Union, that this needed to be fixed. And I think that is where
the willingness to ban part of the rules came from rather than Italy itself.
ASHER: So, how did these two banks in Italy end up in this position in the first place?
VAN NIEUWENHUIJZEN: Well, I think this is just a result of one of the longer structural problems in the Italian economy, which were actually
there before we even had a euro crisis. It's just a sense of very low productivity in the corporate sector in Italy, leading to a buildup of
nonperforming loans in all kinds of parts of the Italian banking system. Under pressure of the crisis of recent years, debt came to the forefront,
but it was long-standing structural problem in the setup of the Italian economy that rose to the surface here.
ASHER: So Intesa is going to be taking over-- will be taking over the good assets of these two banks. What will these deals mean for them?
[16:20:00] VAN NIEUWENHUIJZEN: Well, you know, in the end I think, as you said, this is the good part. They get a $5 million injection into a debt
part of the failed banks to make it good. In that sense, it's a good deal for them. But I think, rightly emphasized by the European Central Bank in
Brussels, the European Commission is that it doesn't mean the competitive landscape in the Italian banking system is all of a sudden completely gone.
So, I think it's a good deal for them, but it doesn't mean they're dominating the Italian banking space. There's more than enough room there
for further consolidation.
ASHER: I do want to talk about the rules a little bit more. Because just recently Spain's Banco Popular was wound down without state aid. Explain
the loopholes that actually allowed for the bailout of the two Italian banks.
VAN NIEUWENHUIJZEN: Well, again, I don't think there is so much a technical element to it. To some extent --.
ASHER: But how are the two situations different?
VAN NIEUWENHUIJZEN: Well, I think in Spain it was just a cleaner and easier exercise. Also, because they have done these exercises already in
the past. They were prepared for it. In that respect Spain and is well ahead. The domestic willingness to solve this in a clean way is much
higher in Spain. They've had their banking crisis years ago already. And in Italy they never had these types of injections into the banking system,
so they had to sort of get used to it.
(END VIDEOTAPE)
ASHER: In Europe, major markets closed in the green. Italian stocks finished higher after a deal was reached on winding up to failed regional
banks, as our guest was just mentioning there. Strengthening oil prices also helped lift the energy sector as well. The British Prime Minister,
Theresa May is making progress on two crucial deals for the U.K.'s political future. On Brexit negotiations Ms. May has revealed more
details on EU citizens living in the U.K. saying she wants them to stay.
And back home in Westminster the Prime Minister has reached a deal to guarantee support for her minority government. Her Conservative Party has
signed an agreement with Northern Ireland's DUP, Democratic Unionist Party. The deal was agreed after the U.K. pledged an extra $1.3 billion for
Northern Ireland. Carole Walker is a CNN political analyst. She joins is live now from London. So, Carole, give us more details about what the DUP
will be getting in exchange.
CAROLE WALKER, CNN POLITICAL ANALYST: Well, Zain, this is a hugely controversial deal. Not only are the DUP getting more than a billion
pounds for communities in Northern Ireland to improve public services and infrastructure, that is at a time when the whole country has been facing
many years of austerity. And of course, other parts of the U.K. are saying, well, we could do with sums like that to improve our communities.
The leader in Wales, Carwyn Jones, said this was a straight bond. The main opposition Labour Party said this was a grubby little deal and political
bribe to keep Theresa May in power. And it's not just the money. The Democratic Unionist Party have opposed any extensions to abortion rights.
They've opposed to gay marriage in Northern Ireland. They won't be able to actually affect matters like that across the rest of the U.K. But many in
Theresa May's own Conservative Party are saying, look, it is toxic for the Conservative Party to be associating with the DUP. This is going to
undermine all the efforts to modernize the Conservative Party.
After that, the very complicated political situation in Northern Ireland, where the British government is committed to being evenhanded. And people
are saying, how are you possibly going to be even handed if you're in this deal with DUP to get your own vote through? It's a highly controversial
deal.
ASHER: So, Carole, you mention said some on the more controversial viewpoints of the DUP when it comes to same sex marriage, when it comes to
abortion, when it comes the climate change. And I understand some that some people within the Conservative Party have issues with that. How are
ordinary British voters reacting to some of the DUP's less modern way of thinking?
WALKER: Well, I think they see this as a deal that will help Theresa May to survive and get through the key votes she's got to get through this
week. Should enable her to get through her Queen speech legislative program. She will survive that vote. But I think many people will be a
little bit uncomfortable about how much power the DUP will now have. Because although Theresa May's deal she may get DUP's support on some of
the big issues, the big votes, she will have to wrangle with them vote by vote, day by day. And that gives the DUP a great deal of power. So, I
think many voters will be very concerned about that. And the opposition Labour Party I think will use it to say it that it shows Theresa May has no
mandate to stay in power.
[16:25:02] Carole, you are such a trooper. You're making it through despite the coughing. I've had the same thing happen to me live on-air.
But thank you so much for joining us. Hope you're OK. Thank you.
Well, Theresa May says the family members of EU citizens living in the U.K. will be able to join them after Brexit. The plan has been criticized by
European leaders with EU's chief Brexit negotiator, Michel Barnier, saying, more ambition, clarity and guarantees are required. Speaking earlier, May
stressed she wants the uncertainty to end.
(BEGIN VIDEO CLIP)
THERESA MAY, BRITISH PRIME MINISTER: I know there's been some anxiety about what would happen to EU citizens at the point we leave the European
Union. Today I want to put that anxiety to rest. I want to completely reassure people that under these plans no EU citizen currently in the U.K.
lawfully will be asked to leave at the point the U.K. leaves the EU. We want you to stay.
(END VIDEO CLIP)
ASHER: She wants you to stay, but too little, too late. That's the view of the opposition Labour Party. I'm joined now Seb Dance, a member of the
European Parliament for the Labour Party. He joins is live now from Brussels. So, Seb, what do you make of the proposals of EU citizens living
in the U.K.? What are your thoughts?
SEB DANCE, MEMBER OF EUROPEAN PARLIAMENT, LABOUR PARTY: Well, it is too little too late because of course, there is the concept of European
citizenship that allows people to move from one member state to the another. And that is the concept under which the nearly 3 -- in fact, more
that 3 million EU citizens who live in the U.K. and move to the U.K. under. And life is complicated. You don't just move yourself. You don't just
move with the job. You bring your family. You move into a new community. You fall in love with people and you integrate yourself into that
community. Many people, of course, have been here for many, many years.
And it's all very well saying this proposal will guarantee their right to stay. But look at the details. Look at the onerous forms that they'll
have to fill out in order to register. And frankly I've got no faith in the ability of this government to manage that registration process.
Because already we've seen with applications for leave to remain, for example, an onerous 84-page form that has to be fill out. Where the
slightest mistake means it had to be returned to the sender and the fee isn't then returned either and you have to start that application again.
People have been living under this cloud for over a year. And this certainty that the Prime Minister claim she's created and provided I'm
afraid is simply not there.
ASHER: So, from the Prime Minister's perspective though, she's basically saying, if you've been in the U.K. for five years or more, you'll be able
to get settled status. If you've got family members before the cutoff date they'll be able to join you as well. What specific changes would you like
to see?
DANCE: Well, there's a problem here with the way she clarifies it. She says lawfully. What does it mean when you're not lawfully in the U.K. as
an EU citizen. Now, we, for example, have an assumption that anyone could move from the EU to U.K. for whatever reason. That's simply not true.
There are restrictions under free movement rules. Now have those restrictions implemented by the government up until now? No, they haven't.
So, for example, if you did come as an EU citizen and you find yourself for a short period of time without employment, are you still lawful? What is
the definition of being lawfully in the United Kingdom? What should have happened in my view and is the view of the Labour Party, is that right at
the outset the issue of citizens' rights should have been taken completely out of the negotiation process.
Because we now have a situation, of course, where this proposal will be taken in line with all the other negotiations that have to be taken with
regard to the membership of the single market, or no membership of the single market, customs union, tariff barriers, et cetera. All of that is
now part of the discussion. So, you can isolate the rights of citizens with the proposal that the Prime Minister has come forward with. And that
means, of course, that the cloud that people have been living under for a year will simply last the remainder of the negotiations. It's
unacceptable.
ASHER: So, Seb, as you know, and you've noted this in the past, Britain is extremely divide right now. If Labour were in power, how would they work
to heal those divisions?
DANCE: Well, in our manifesto commitment, there was a clear commitment bet we would protect, and indeed, reference the rights of the EU citizens. And
that, by the way, goes the other way. It means the millions of U.K. citizens in the rest of the EU as well. I think we should take that issue
off the table. It should be settled right at the beginning and then it shouldn't be part of the rest of the negotiations. We have a small
taskforce of MEPs here from across the EU, from across political groups, who have been saying this as well to this side of the negotiation table to
say, look, this is something that should be taken off the table right from the outset. Because if you're making key decisions about you live and
about your, for example, education --
ASHER: Seb, we have to leave it there. We're running out of time but appreciate you being with us. Thank you so much. Appreciate that.
[16:30:00] Hundreds of high rise buildings in Britain are being tested for fire safety after the shocking Grenfell Tower blaze. So far there's a 100
percent failure rate. We'll have the latest on the investigation after the short break. Don't go away.
(COMMERCIAL BREAK)
ASHER: Hello everyone. I'm Zain Asher. Coming up on the next half hour of QUEST MEANS BUSINESS, Takata has reached the end of the road. The
company has finally filed for bankruptcy.
And the cost of the new Republican health care bill has just been revealed. We will take you live to Capitol Hill in just a moment. But first, these
are the top news headlines we're following for you at this hour.
The U.S. Supreme Court is allowing part of President Donald Trump's travel ban to go into effect for now. It would apply to foreign nationals from
six majority Muslim countries who don't have ties to family, schools, or jobs in the USA. The court will hear full details in October.
A coalition spokesperson says only a few hundred ISIS fighters are left in Mosul once the terror group's stronghold in Iraq. They say their holed up
in the old city where Iraqi forces have been leading the operation to clear them out. The Iraq military recaptured its first neighborhood in the old
city on Monday.
And there's been a political breakthrough in the United Kingdom. After weeks of uncertainty, the Democratic Unionist Party of Northern Ireland has
agreed to support a minority Conservative government. The parties have been talking since Prime Minister Theresa May lost her party's majority in
that snap general election.
A warning for Turkey ahead of the G20 summit next week, Germany says Erdogan's bodyguards are not welcome in Hamburg. Turkish security
officials and some of President's security team clashed with protesters in Washington last month. Nine people were hospitalized.
A Spanish court has ordered the remains of surrealist painter Salvador Dali to be exhumed after a woman filed a claim saying she's his daughter. The
Dali Foundation says it will fight the court order.
The manufacturer of the cladding that caught fire in the Grenfell Tower disaster says it's stopping sales of the product. Shares of the American
company Arconic have dropped by 6 percent. Hundreds of high rise buildings are being tested for fire and safety across the U.K. So far, every single
test has failed. By the way that's 75 buildings. Our Ian Lee has more from London.
(BEGIN VIDEOTAPE)
IAN LEE, CNN CORRESPONDENT: I'm in Camden where five of these buildings are four of which have been evacuated. On that fifth one they say it's
safe for residents as long as there's a fire marshal 24 hours a day. I want to give you a look at one of these buildings that was evacuated looks
like. So, you can see there's that cladding that goes all the way up to the top. And that's the accelerant. And they say that is what is unsafe
for residents.
[16:35:00] In talking to them you have a wide range of opinions. Some say they're glad the government is evacuating them. They want to see this
remedied as quickly as possible. And also have the government take care of them in the meantime.
But then you have other residents who are angry saying just a few steps could be taken to make these buildings safe.
BELINDA BROWN, CHALCOTS ESTATE RESIDENT: What I would like to see now is rather than boot out everybody, OK, you have to re-clad the flats. But
what you could do is give every flat a fire blanket. We all have fire alarms anyway, and it's very cheap to put a fire alarm in. Take a few
minutes to screw it up and get it going.
LEE: And it is not just these residential complexes. And you have hospitals, schools, hotels, shopping centers that have this sort of
cladding. And the government has issued a directive to the different agencies to see how expensive this problem is. We know the national health
service is looking into it as well as the department of education. This is just really seems like the tip of the iceberg that will eventually cost
millions of pounds. Ian Lee, CNN, in Camden, London.
(END VIDEOTAPE)
ASHER: Takata was at the heart of one of the world's worst auto safety scandals. Now the company has gone bankrupt and key parts have been sold
off. Takata's debts have skyrocketed to $9 billion following its exploding air bag crisis. CNN's Will Ripley has more.
WILL RIPLEY, CNN INTERNATIONAL CORRESPONDENT: A stunning fall for Takata, once a titan of the auto parts industry undone in one of the worst safety
scandals ever. Exploding air backs blamed for at least 11 deaths in the U.S. In Tokyo, disgraced company leadership announcing a more than $1.5
billion bankruptcy deal. Takata selling off most of its business to a U.S.-based rival. "I apologize deeply from the bottom of my heart" says
Takata's embattled CEO vowing to resign once the deal is done. The company's family founded more than 80 years ago on the verge of collapse.
The bankruptcy deal aims to keep key factories open and tens of thousands of people employed.
The unprecedented global recall affects many, and tens of millions are still on the road right now. They can explode with too much force,
becoming jagged metal projectiles. I saw the danger first-hand two years ago at this Japanese scrap yard. We're just lucky -- told me after a
series of Takata air bag explosions. Workers say the force of one of these explosions was so powerful it actually shot a piece of piece of metal up
ten meters, 33 feet, leaving that hole in the ceiling. The government calling Takata's bankruptcy unavoidable. Takata's admitted to manipulating
key air bag information for years. One of the industry's oldest and most successful suppliers, this is the end of the road. Will Ripley, CNN,
Tokyo. (END VIDEOTAPE)
ASHER: By the way, it will cost an estimated $5 billion to replace all of those faulty air bags inflators. Here to help us understand what happens
next, Karl Brauer is the executive publisher of "Kelly Bluebook". He joins us live now. Thank you so much for being with us. So, for the car
companies that rely on Takata's air bag for example, Honda, Toyota, GM, what happens to them? What's their fallout?
KARL BRAUER, EXECUTIVE PUBLISHER OF "KELLY BLUEBOOK": Well, unfortunately, they've been in a holding pattern for a while. They have been obviously
trying to get the airbags produced as quickly as possible. But they have not been coming. A lot of people have been waiting with notices that their
cars have the defective air bags but told they shouldn't come into the dealer until they're ready, it could be a while. The bankruptcy only adds
to the murkiness of that. In theory, it should just continue to replace the air bags, Takata, and the new owner of the key safety systems should
continue to the process. But it's always tricky when you've got an entire company going bankrupt, ownership changing. It certainly opens up the
possibility for even more delays on what is going to be a 2 to 4-year process.
ASHER: It's definitely murky as a result of the bankruptcy. What also happens to -- I mean the victims, will they be fairly compensated given the
bankruptcy?
[15:40:00] BRAUER: Well, that's the whole other thing that beyond the actual labor and production costs of making these air bags and getting them
replaced are all these liabilities. And of course, key safety systems aren't taking that on. So, it's very likely manufacturers will have to be
taking on an element of this. If Takata is gone, I think that leaves the manufactures holding the bag so to speak.
ASHER: So just summing up key safety systems, what is their business strategy here? What is the strategy behind key safety systems taking on
part of the business?
BRAUER: I think they feel like this was a 20 plus percent segment of the market that Takata had. Remember this is a Chinese owned company that's
based in the U.S. they're going to be able to take up the slack, I think, and get a lot of -- they'll pick up a lot of the same percentage market
that Takata left open. So, I think if they can buy Takata's production capabilities and jump in there but not have the liabilities Takata was
facing, it's actually a pretty good move for them.
ASHER: And what about Takata's 60 million employees around the world?
BRAUER: You know, that's another big question mark. Obviously, they'll be looking like any new owner at the costs. And I would guess that a certain
percentage of those employee would want to remain and they'll want to keep them because of their history with the processes. But it's likely some
percentage will go.
ASHER: When you think about the nightmare of a journey Takata has been on for the last couple of years, their stock has gone down. Just walk us
through what the road has been like for Takata just since then?
BRAUER: Yes, when you're one of like three or four global air bag suppliers and it's a massive market, you're in a very good position. And
so, Takata was seen as someone that was really well-positioned to continue to make money in this area. And they've gone of course to bankruptcy now.
It just shows how it can continue to shift if you have an issue like this that comes out of nowhere kind of.
ASHER: The U.S. Supreme Court will hear arguments on the president's travel ban later this year around October. The White House is already
calling today's ruling a victory for national security. We'll have more on that after the break.
[16:45:00] (COMMERCIAL BREAK)
ASHER: Welcome back, everybody. President Trump calls the Supreme Court ruling a clear victory. The U.S. National Security Agency, crucially the
president's statement, also called the order a suspension rather than a ban. CNN's Kaitlan Collins is following all the latest developments. She
joins us now from outside the White House. This is essentially a compromise.
KAITLAN COLLINS, CNN WHITE HOUSE REPORTER: That's a great question, but for a White House that doesn't have much to celebrate as victories these
days, this is pretty good victory for them they've decided. Donald Trump said it's a clear victory for national security in a statement he issued
this morning. He tweeted he was grateful for the Supreme Court's decision. And as he welcomed the Indian Prime Minister here a few minutes ago, he
said he was feeling very good about what the Supreme Court had to say this morning. If you're looking at statement the president issued today, it's
interesting to note he doesn't call it a travel ban. He instead call it a travel suspension. It's interesting because over the last six months
President Trump has said on Twitter a travel ban and saying calling it anything else is an incorrect term.
ASHER: It's also interesting they say things could change between now and October. A, what do they mean by that, and B, going back to your point, is
it too early for the White House to see this as a win?
COLLINS: Well, the travel ban was supposed to be temporary in the first place in order to give the United States time to discuss extreme vetting
procedures and figure out what's the best way for letting people into the country. It could be argued they've had plenty of time to enact extreme
vetting, but the White House says it still needs that time. It's also interesting to note this is the revised version of the executive order that
the Supreme Court will be hearing oral arguments on when they return in October. This is the thing that Donald Trump has derided as watered down
and politically incorrect. So today, he said it would help keep our nation safe it was good for national security. But just recently on Twitter he
said this was a watered-down version that the DOJ submitted to the Supreme Court.
ASHER: I do want to ask about Neil Gorsuch. Obviously, that was one major win for President Trump given that he appointed Neil Gorsuch in that
vacancy left by Antony Scalia. Is he happy with the way Gorsuch has ruled so far?
COLLINS: Yes. The administration has been very happy with Neil Gorsuch. Like you said, he is one of their biggest accomplishments. They don't have
any legislative victories or wins, so this is their big thing. But it's also interesting to know you say that. As these rumors fly that Anthony
Kennedy might step down, Sean Spicer was asked today in an off-camera gaggle whether the Trump administration may choose from the list last the
Trump campaign released last May of potential Supreme Court nominees? Now, though Donald Trump has said, yes, he would stick to that list, he thought
was good idea and it was helpful the first time around. Sean Spicer said today there could be some additions to the list.
ASHER: And Kaitlan, if the White House overall was so happy with the ruling today, why wouldn't they do their press briefing on camera?
COLLINS: That's a good question. That's a question to the White House, though, why they're not doing any press briefings on camera lately. In the
month of June, they've done ten press briefings off camera and only five on camera.
ASHER: Kaitlan Collins, live for us there, thank you so much.
If guys at home want a daily digest of top business stories delivered right to your inbox every single night, all you have to do is subscribe to the
QUEST MEANS BUSINESS newsletter. All you have you have to do to subscribe, you know you want to, is go to CNNmoney.com/quest.
U.S. lawmakers want to vote on a new healthcare bill but can they make it through the chamber before recess next week? They have new numbers at
their disposal. And we'll bring them to you next.
[16:50:00] (COMMERCIAL BREAK)
ASHER: Welcome back, everybody. The new Republican health care bill would leave, get this, 22 million fewer Americans with health insurance, 22 more
million uninsured by 2026 then under Obamacare. That's the findings of a key partisan report that U.S. lawmakers have been waiting for. So, Phil,
just give us details what was in this CBO report?
PHIL MATTINGLY, CNN CORRESPONDENT: So, yes, you hit the top line number. This is one everyone's going to be paying attention to. This is obviously
not a good number to say the least. It you compare to the house bill, the house bill ended up at about 23 million. The senate Republicans thought
their number would be better. They changed the incentives of the tax credit, changes incentives in many different ways to try to bump up the tax
number. That of course, did want work well. The deficit savings over ten years from this bill would be over $321 billion. The rules the senate has
to use to pass this, they only need it have a $133 billion in deficit reductions.
So that's essentially a pot of money for senate leaders to work with to try and some of
those wary Republican senators off the fence and come support this bill. The other key issue to pay attention to is on premiums. Over the first two
years after this bill would be implemented, premiums would go up. That would more problematic for the more conservative Republican senators. But
by 2020, by 2026 over the course of a period of time, the premiums would go down. And that is by design, the senators are trying to draft legislation
that would have plans, that would have less coverage, more unlike the affordable care act which mandates certain things be covered in every
single plan, Republicans are trying to do away with that, give individuals plans that do less but in turn cost less. There's no question about it, if
you're an individual who has a pre-existing condition, if you're an individual that needs more expensive care than most, this bill isn't going
to do much and may actually set you back, Zain.
ASHER: And based on that, do you think most Republicans in the senate will be taking the CBO score seriously or believing what they want to believe?
MATTINGLY: A little bit of the latter? Look, it depends on the senator. We've already had two senators, two moderate senators, Dean Heller of
Nevada, Susan Collins of Maine point to the coverage number before it came out, and say that's very important for my vote. I need to know where that
actually stands. Those are two senators who are sitting on the fence, they now have that number, where do they go from here?
There are certainly a lot of senators who quibble with how the CBO models out its scoring, doesn't believe it scores adequately or accurately for
conservative proposals. And they'll brush this aside. We have already seen the White House doing that in a couple releases just in the last
couple minutes. I do think on the top line number and certainly when you're talking about political campaign ads, how Democrats are going to
attack this in the next couple days, you can't ignore that top line number. It matters whether Republicans say it doesn't or not. And it's something
we're going to hear over and over again in the next few days as senators try to get to a vote by this end of this week.
ASHER: Phil Mattingly, live for us there, thank you.
On Wall Street markets at the end of the day pretty much flat. The Dow and the S&P finished with moderate gains. Major technology stocks struggled,
Apple, Facebook, and Alphabet which is the parent company of Google, by the way, all ended lower. The NASDAQ also closed in the red. Shares in Nestle
rallied after a hedge fund actually invested -- I should also mention in Europe major markets closed in the green. Italian stocks finish higher
after a deal was reached on winding up two failed regional banks, strengthened oil prices also helped lift the energy sector as well. And
you can now download our show as a pod cast and available from all the major providers and you can listen at CNN.com/podcasts.
[16:55:00] As I said, shares in Nestles rallied after a hedge fund actually invested more than $3 billion in the company. Now the activist investors
want the CEO to make major changes. Let me just show you what some of these changes are.
Number one, the first is to affect productivity and set more aggressive targets. Number two, return capital to shareholders by essentially buying
back shares. Number three, to reshape the portfolio.
Nestles actually manages more than 2,000 brands. This one is actually difficult for the Nestle CEO to swallow, but they actually want them to
sell their 22 percent stake in the cosmetics company. That is QUEST MEANS BUSINESS. I'm Zain Asher in New York. Be back on the show tomorrow. Have
a great evening.
END
