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Quest Means Business
Juncker Urges Europe to Be Bold; Foreign Aid Arrives in Caribbean; Equifax Shares Sink as CEO Apologizes; Los Angeles and Paris Secure Olympic Bids; EasyJet Unveils New Long-Haul Route Plan. Aired 4-5p ET
Aired September 13, 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 HOST: All right sound -- oh, look, they look so excited. That's the month and training day on Wall Street. Let's look at
how the markets did. Remember yesterday, we ended ever so slightly at a record close today. We saw a little bit of profit taking. The markets
closing up about 37 points or so.
One stock I should note is of course Apple. Because they had the massive announcement yesterday with the iPhone 8 and iPhone 10. Investor weren't
so sure about it today. The stock ending down a little bit less than 1 percent.
It is Wednesday, September 13. Tonight, the state of the union, my friend, is strong. Jean-Claude Juncker tell Europe it is time to be bold. I'll
speak to former ECB president, Jean-Claude Trichet, inn just a moment. More foreign aid arrives in the islands hit by Irma after critics said it
came way too slowly. And Equifax shares are hacked to pieces. Now the chief executive is apologizing once again.
Hello, everyone, I'm Zain Asher and this my friend is QUEST MEANS BUSINESS.
Welcome, everyone. Tonight, Jean-Claude Juncker says Europe is back and now it's time to change. In an impassioned and ambitious state of the
union speech, the European Commission President called for a more powerful, less bureaucratic and increasingly integrated European Union. He said that
after economic recovery and after defeating a series of populace threats on the continent, Europe now has momentum and a narrow opportunity to reform
for the better.
(BEGIN VIDEO CLIP)
JEAN-CLAUDE JUNCKER, EUROPEAN COMMISSION PRESIDENT: All of this belief the wind is back in you sights. We have now a window of opportunity, but it
will not stay open forever. Let us make the most of the moment and catch the wind in your sails.
(END VIDEO CLIP)
ASHER: All right, so you just heard him there. Mr. Juncker wants to catch the wind in Europe's sales.
Let's set sail on the good ship EU and explore what exactly he is proposing. So, one of the first things he is proposing -- here it is
coming in every so slowly. One of the first things he's proposing is that he wants the countries that are in the union, but not using the euro to
adopt the single currency. Juncker says the euro has the power to unite and integrate the block and right now having different currencies is only
dividing.
Let me see if I can get this to work. Let me move it again. He also wants to streamline economic policy as well. Juncker thinks the commission
should add a position such as the EU finance minister. That brand-new position would basically coordinate reforms and the financial tools across
the member states as well. And one other thing he wants to do is he wants to merge the European Commission President -- that's basically his job --
within the European Council president -- that is Donald Tusk's job. Juncker says Europe would be easier to understand with just one captain
steering the ship.
(BEGIN VIDEO CLIP)
JUNCKER: As Mark Twain wrote, I'm quoting, years from now we'll be more disappointed by the things we did not do than by those we didn't. Now is
the time to build and more united and stronger and more democratic Europe for 2025.
(END VIDEO CLIP)
ASHER: Earlier I spoke with Jean-Claude Trichet, the former president of the European Central Bank. He has worked alongside Juncker for decades and
told me these are good proposals, but they will be difficult to achieve.
(BEGIN VIDEOTAPE)
JEAN-CLAUDE TRICHET, FORMER PRESIDENT, EUROPEAN CENTRAL BANK: Well, I think it's a very bold proposal, obviously. And I'm not sure that it will
be a proposal that would get approval immediately. Because there you're really merging two major institutions in Europe. If you merge the heads,
of course you are merging also the functioning for a large part. So, we will see.
I myself made the proposal of the minister of finance, six years ago. And it seems to me that now this idea is retained also by Jean-Claude Juncker
and by a number of heads, including Mr. Macron. I think it is more or less the same idea, but the delivery of the of the governance. You need a
single person to make the synthesis on all the governance of EU. That would be the case if we had a minister of finance for the EU.
[16:05:03] Merging the President of the Euro Group and the Commissioner. But again, these are very bold proposals which perhaps have a chance to
proceed in the present circumstances.
ASHER: So then, what would be the immediate effect if those positions were merged? What would be the immediate effect?
TRICHET: The rest of the world would know who to talk with when you are talking to Europe as a whole. And that simplifies certainly the image of
Europe, the capacity of Europe to proceed. Also, there is an evolution which is a very, very strong evolution of the European institutions, where
the Council was an intergovernmental by definition, entity and the commission and the Council we are incorporating to change the legislation
in Europe, primary legislation, secondary legislation. Now we are in the universe where we need much more to the equivalent to the executive branch.
Not only because of the crisis, but because of the fact that Europe is advancing in the direction of an entity of a new type. But which needs, of
course, some kind of executive branch able to respond very happily and swiftly and exponentially. In many circumstances like it has done in a
particular country.
ASHER: What is at stake for Europe if the EU doesn't become as integrated as it should be or as it needs to be.
TRICHET: The will of the continental European to continue proceed in the extraordinary historical endeavor which started 66 years ago. And which is
still there. That will is there and of course it is more appropriate than ever, I have to say, because of the emergence of the emerging countries,
India, China, Brazil, Mexico and Indonesia, you name it.
Because also of the fact that the world is changing so rapidly that a lot of very important challenges have to be coped with at the level of Europe
as a whole, including, of course, migration, including control of the borders of Schengen, including a lot of things that appear in the present
circumstances overdue. And I would add including the European Union defense. Which is backed by the people and was also mentioned by Jean-
Claude Juncker.
ASHER: And just quickly, he also talked about the fact that the U.K. will regret Brexit. It will regret leaving the EU. Do you think that's true?
Do you agree with that?
TRICHET: I see a lot of my British friends who are of that sentiment. Of course, not surprisingly. You know, he also said it was a very sad, I
would say, event for all the Europeans that the British decided to leave. I would say for very good reasons. The U.K. was the sanctuary of
democracy, a representative democracy. The U.K. was the sanctuary market economics. The U.K. was and is the sanctuary of civil rights. It's
extremely sad for all of Europe. Of course, it is the decision of the U.K. people. We cannot undo that.
But Europe and the open endeavor has started 66 years ago -- 67 years with the speech of Robert Schuman, inspired by Jean-Benoit. The U.K. was not on
board at the very beginning. The U.K. came late on the ship. The U.K. is leaving the ship. It doesn't change in my opinion the historical evolution
and the Stryker project of the European. And it is more or less what was said by Jean-Claude Juncker.
(END VIDEOTAPE)
ASHER: Jean-Claude Trichet speaking to me a little bit earlier.
The market in Europe ended the day mixed. Frankfurt and Paris ended slightly higher. The FTSE fell 3/10 of 1 percent weighted down by mining
stocks. And Zurich ended flat. In terms of here in the U.S. It was certainly a choppy day at the beginning. Stocks on Wall Street with small
gains for the Dow. The S&P and Nasdaq were actually enough to push the three major indexes to new records for a second day in a row. Let's talk
more about this with Paul La Monica. So, Paul, at the beginning is not enough only to be choppy, without getting too much into the weeds. You
know, is suddenly sort of began to pick up halfway through the session. Why?
[16:10:00] PAUL R. LA MONICA, CNNMONEY CORRESPONDENT: Yes, I'm not sure exactly if there was a catalyst to say why we went from being down slightly
to finishing the day up slightly. But Zain, it definitely does point to the fact that this market for whatever reason, investors want to keep
pushing it higher. The S&P 500 finish this close to 2,500 for the first time ever. And I think there still is a lot of optimism about earnings
that we'll start getting month and holiday shopping season as well. Despite all of the craziness that seems to be going on a daily basis in
Washington.
ASHER: So, a lot of optimism in general. But I can tell you one stock that people are not that optimistic about is Equifax.
LA MONICA: Equifax really --
ASHER: Hard. Down 12 percent.
LA MONICA: Yes, it's below hundred. This is a company that we know that something has to be done. I think at a corporate level to really prove to
Wall Street and also probably even more importantly, consumers. That they can't go on with business as usual because of the security problems the
data breach. More than 140 million Americans that potentially could be affected by this. There is a crisis of confidence with this company right
now. Wall Street has no faith I think in current management to fix things. Senator Mark Warner from Virginia, now wants the FTC to look into this.
And that was the catalyst for the stock's big plunge this afternoon.
ASHER: I'd say it wasn't just the fact that there was that massive data breach, it was also how they handled it afterwards. They had investors and
ordinary citizens fearful. All right, Paul La Monica, live for us there. Thank you so much.
LA MONICA: Thank you.
ASHER: You're welcome.
Donald Trump says he's not interested in lowering taxes for the rich. His administration is working alongside Republicans in Congress to draft new
tax legislation. It's expected to be introduced in the next few weeks. Speaking last hour at the White House. Mr. Trump said he wants to lower
taxes on corporations and middle-class Americans.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We want a 15 percent rate because that would bring us low, not by any means the lowest, but it would
bring us to a level where China and other countries are. And we will be able to compete with anybody. Nobody will be able to touch us. So, we
would like to see 15 percent. OK? Thank you very much everybody.
UNIDENTIFIED MALE: Sir do you go --
TRUMP: Lower for individuals. Much lower than that for individuals. And the rich will not beginning at all with this plan.
(END VIDEO CLIP)
ASHER: All right, let's talk more about this with Jeff Zeleny. He's at the White House for us. So, Jeff, 15 percent, that would be a big boost to
corporations in America if Mr. Trump is actually able to get this through Congress. Remember that this is an administration that hasn't had any
major sort of legislative wins so far.
JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: No question about it. I mean, 15 percent is optimistic to say the least. I mean, it is the
President's wish. We can call it an opening gambit if you will. But you talk to Republicans on Capitol Hill who are deeply entrenched in tax policy
and they're pretty skeptical of 15 percent. But that doesn't mean that tax cuts of some kind won't happen. I mean, this is a central focus of the
White House right now. You can heard of see a plan coming together pretty slowly.
But the President speaking more directly about this than he has before. And I was struck by just standing in the room there -- in the cabinet room
-- just a couple hours ago. The president not closing the door to raising taxes on the wealthiest Americans. Of course, that is deeply at odds with
the Republican orthodoxy. And that certainly not his first choice here. But there are some people in the president's orbit, Steve Bannon among
them, who's still a key strategist. Who believed that this upper bracket should increase as well here. There's no question that a big tax reform
package is going to be the most difficult thing that this White House has ever tried to achieve, or if they pull it off it was certainly be a big
accomplishment.
ASHER: Yes, in the question is who on earth is going to pay for it? But as you mentioned --
ZELENY: That's always the question.
ASHER: It is always the question. Jeff Zeleny, live for us there. Thank you so much.
President Trump is planning to visit Tokyo and Beijing in November according to U.S. officials. It's his first trip to Southeast Asia as
President. And they also include a stop in South Korea in the middle of the nuclear tensions with the North. CNN's Will Ripley is inside
Pyongyang. As he found out ordinary North Koreans don't seem concerned by the President's rhetoric.
(BEGIN VIDEOTAPE)
WILL RIPLEY, CNN CORRESPONDENT: Here in Pyongyang government officials are strongly condemning this latest round of UN Security Council sanctions
using words like evil, vicious. Calling it a full-scale economic blockade. But when you go out on the streets and speak with regular people, they
don't seem concerned at all.
[16:15:00] (voice-over): It's tough to find a traffic light in Pyongyang. Traffic cops direct the flow of cars. The streets noticeably busier each
time I come here. Busier at least for now. The U.S. says the latest UN sanctions threatened to cut North Korea's oil supply by nearly 1/3, which
could spike prices for everything, from taxis, to energy. A ban on textile exports and the end of foreign labor contracts could further slash the
income of this cash starved country.
But if you ask Ri Hye Hyang, she's not worried. Her refreshment stand has a steady flow of customers. She says life is improving despite round after
round of increasingly heavy sanctions.
We have no problems, she says. Everything I'm selling is made locally. We don't worry. We rely on ourselves.
Kim Hye Song casually shrugs off threats from the United States.
(on camera): The U.S. President, Donald Trump said that the sanctions are just not a big deal and that there is much worse to come. Does that were
you at all?
We don't care what the U.S. President says or what the outside world thinks about us, she says. We don't worry because we believe in the leadership of
Marshall Kim Jong-un.
(voice-over): Keep in mind this is a very thin slice of life in this close country. Reporters like us can only see what the government allows. But
all over the North Korean capital we see plenty of new construction. An increasingly modern skyline, a mandate from North Korea's leader, Kim Jong-
un. Determined to prove he can grow the economy and the nuclear program. All in the face of unprecedented sanctions for his repeated violations of
international law.
(on camera): You see these posters all over Pyongyang and they pretty much sum up North Korea's official response to increased pressure from the U.S.
More missiles. North Korean propaganda is built around their nuclear program. It symbolizes strength, independence. It's key to their national
identity.
(on camera): Is there anything, anything at all back and get North Korea to walk away from its nuclear program?
We'll never give them up, says Ri Chang Son. If we did it would mean our destruction.
(voice-over): Around town new posters show a pair of hands ripping up UN sanctions resolutions. North Korea's defiant message, they will never give
up their nukes. Even if that means life is about to get a lot harder.
(on camera) And that really is the bottom line. North Korea says these nuclear weapons are vital to their survival as a nation. And they say
these latest sanctions will only speed up, not slow their development of weapons of mass destruction, threatening to escalate a dangerous situation
even further. Will Ripley, CNN, Pyongyang, North Korea.
(END VIDEOTAPE)
ASHER: And by the way, a bit of a programming note for you. Will Ripley is the only Western journalist currently on the ground in North Korea. By
the way, he's been there about 14 times to Pyongyang. This weekend he takes you on an exclusive look at the country like you have never seen
before. Trust me, you will not want to miss this. It's a CNN special documentary called, "Secret State, Inside North Korea." Watch it Saturday
at 1 p.m., that's London time, 2 p.m. Central European Time. Of course, only on this network, only right here on CNN.
All right, still to come here on Quest Means Business. Around 200,000 people are in desperate need of help across the Caribbean. They say their
governments in the U.S. and Europe have pretty much abandoned them. We'll be live for you in St. Maarten next.
(COMMERCIAL BREAK)
[16:20:29] ASHER: Welcome back, everybody. One week after hurricane Irma smashed into the Caribbean the hardest hit islands are getting some relief
-- that's a good thing. Leaders from Europe have arrived with aid and pledges to rebuild. They are under heavy, heavy criticism. Accused of
neglecting their responsibilities in the region. The French President continued his tour of the devastation in St. Maarten. Emmanuel Macron
said public order is under control following reports of looting.
The British Foreign Secretary, Boris Johnson, toward parts of the region earlier today and defended his government's response as well. Back in
London, Prime Minister, Theresa May, pledged an additional $33 million in aid.
CNN's Cyril Vanier is tracking aid efforts for us. So, Cyril, gosh I'm just looking at the devastation behind you, that is really something. You
know, amid all of the devastation and destruction, just talk to us about some of the personal stories of resilience. I do want to focus on the
positive a little bit. Just talk to us about some of the stories of resilience. People really sort of coming together in the wake of this
nightmare.
CYRIL VANIER, CNN CORRESPONDENT: Yes, we've got a bit of those, Zain. I'm glad you asked that question about the personal stories and there are so
many to choose from. And you're right to say that there are some positive sides to this. One thing we have not seen here -- we've seen flashes of
anger, we've seen disappointment at how eight is coming in so slowly or not at all. But one thing we haven't seen is self-pity. I haven't spoken to a
single person who has expressed self-pity. And maybe it's just baked into the Caribbean, islander mentality. I mean, I can relate to that. Part of
my family is from this part of the world in the Caribbean. So, you know when you live here that your vulnerable to hurricanes.
But is still remarkable how people are dealing with the situation given their exact circumstances. I'll give you a few examples. One of the
people this morning that I spoke to said her mother, who is sick and should be in a hospital, she's caring for her and she's at her house. But her
mother is running out of medical supplies. They're currently down to their last pack. They don't know what happens after that. If they can get the
medical supplies they need either from their hospital or from their general practitioner. They just simply do not know what happens.
Here at the hotel that you're seeing behind me, which has been totally devastated, 250+ rooms, prime property. This generates a lot of revenue
for the island. Well, it's been -- this part of it has been totally level. There still some people who are actually living in the rooms behind us
because they've got nowhere else to live in their homes of been destroyed. Again, I'm not hearing any self-pity.
Another example, somebody is telling us, somebody who is just coming to scavenge anything she can find, either to eat or to help her in her daily
life. She was telling us tomorrow is payday and I haven't heard from the manager. I don't know what's going to happen. I don't know where my money
is going to come from.
There is really a range of situations that people are dealing with day-to- day, survival -- Zain.
ASHER: Gosh. So, in terms of it being payday, I mean, it's just little things like that -- not little things, I should say little things. But
things like that whereby your expecting your paycheck every two weeks or every month and you don't know if it's going to come.
In terms of the plans to rebuild, the plans to sort of get things back up and running an operational, what is the timeline, Cyril?
VANIER: Well, I'll tell you, I think we should scratch the word rebuilding from our vocabulary here in St. Maarten. I mean, this is not going to get
rebuilt anytime soon. We actually saw the owner this morning. He was thinking maybe a year and a half. I think that's a very optimistic
timeline to be honest. Right now, it's about daily priorities. It's about getting food and water. And it's about making it to the next day.
I'll give you an example. The person who works with us for instance, who is a local journalist and who's helping us get the lay of the land and find
our whereabouts, every morning when he leaves home -- he's got a wife and two kids -- he's got to make sure they've got enough drinking water for the
next day. Where does he find it? It changes every day. Depends on the opportunities. Sometimes the neighbor helps out. Today he told us a
little Chinese restaurant opening, he was able to get the water from there. It's just one of those little examples, but it shows you these are the day-
to-day situations that you have to make in order to survive.
[16:25:00] So, getting back your point, we're not at the rebuilding phase yet. And it is been a week since the hurricane hit and I am surprised.
Because normally, I've covered other national catastrophes, this is when you start saying, oh well, the island is getting back on its feet. Life is
going back to normal. We've all heard these phrases, right? Uttered by journalists. I've said them myself. Well let me tell you, they don't
apply to this place and they don't apply to this time. So, rebuilding is still is still very distant on the horizon -- Zain.
ASHER: Cyril, as you're speaking I have to admit I'm partly distracted because I'm just looking at what's behind you. I mean, it really hammers
home what a lot of people on the island are dealing with and what they're going through. Great reporting, Cyril Vanier. Thank you so much.
The airports on St. Maarten suffered heavy damage during the hurricane. It's currently closed to normal passenger flights. Princess Juliana
airport has become famous for scenes like this. Take a look. Huge jets loaded with tourists from the United States, Europe and Latin America just
feet, just feet from the beach. Smaller planes take passengers onwards to destinations around the Caribbean. 29 million people by the way, visit the
region each year. Bring in more than $35 billion. So, it's obviously a hugely important source of revenue for the island.
With the gateway on St. Maarten's shut down, islands that depend on those dollars, even those that escaped the worst of Irma's path -- Irma's wrath
rather -- might still suffer. Tourism officials worry it could take years to get back to normal. They're begging visitors not to cancel their travel
plans.
Rolando Brison told us last week that he doesn't even recognize St. Maarten anymore. Mr. Brison is the director of tourism on the Dutch side
of the island. He joins us live now from Amsterdam. Rolando, people around the world who might be watching this program who might have
tentatively, let's say they didn't pay for a ticket to St. Maarten, but they have plans in the back of their minds to visit St. Maarten perhaps in
the next year or so. What do you want to say to them?
ROLANDO BRISON, DIRECTOR OF TOURISM, ST. MAARTEN: Well, what I would want to say is that obviously the island is going through a very difficult time
that many Caribbean islands have faced as well. Now is definitely not the time. We have suspended our B to C marketing campaigns until further
notice. Of course, various flights have canceled at least within the first month out. So, no, now is not the time. But what I would say that the
islands two most attractive characteristics, its nature and its people are still here. And as long as that exists this island will be a wonderful
destination for people to visit. Now may not be the time, but we will definitely rebuild and get this place back to where it has to be.
ASHER: But what's going to happen to your economy? I mean obviously, people see the -- we just had a reporter by the way, that was standing in
the wall behind me, right behind him you can see a whole tell dad had just collapsed to the ground. When people see those images, obviously, they're
going to think themselves, you know what, maybe I'll hold off and visiting St. Maarten in the short term. If a lot of people think that way, what is
going to happen to your economy? $35 billion is on the line.
BRISON: Well, we're very lucky that the government of St. Maarten in terms of the economy, we've diversified our tourism product between a
stayover product and the cruise product. The cruise tourism is something as long as the harbor is intact, which it is by the way, that is something
that's probably going to spark a lot sooner. Because these are tours that come to the island, can spend four or five hours. As long as the roads are
clear, the island is safe, there are some restaurants for them to eat and the beaches are beautiful, they have opportunities to still experience the
island.
And furthermore, obviously taxi drivers in the people of St. Maarten to have a lot of stories to tell about what is happening in St. Maarten. So,
I think the cruise sector being that a lot of those attractions are still there. We're counting on the cruise to still keep us afloat so to speak.
Is not going to be what it was. We have been a number one port in the Caribbean for many years. Where going to take some time to get back there.
But in the immediate were going to count a lot on the cruise tourism. And then we start to slowly redevelop our stayover product.
ASHER: Can you just talk to us about what you're getting in terms of aid from the Dutch government? And I hope you don't mind me asking, but why
are you in Amsterdam right now? I know you had been on St. Maarten and then you travel to Amsterdam. Do you mind if I ask why?
BRISON: Sure. It simply because telecommunication is such a huge problem in St. Maarten. I wouldn't have been able to do this interview, for
example, if I was not able to get telecommunication. And with my task being able to coordinate a lot of the airlines, it was actually fortunate
that I'm here and able to connect with all those airlines. And with the limited telecommunications we have of cell phones and so on, communicate
that back to St. Maarten and tell them, hey, Delta is coming. Samaritans Purse is coming, which by the way has been an amazing organization bring so
much relief. Because aside from what the military is doing and they are bringing a lot of support, we as a country also still want to reach out to
airlines and other aid organizations to send as much assistance as possible. And that is only possible if we have telecommunication
capabilities.
[16:30:00] ASHER: Right, and I also hope that people around world who are watching this, it's not just about organizations donating in governments,
it's also about, you know, individuals as well. And I really hope some of our viewers are very generous viewers.
BRISON: Absolutely.
ASHER: Rolando, thank you so much, appreciate you joining us.
BRISON: Thank you so much, and will be strong. Thank you.
ASHER: I wish you the best of luck.
Equifax has come out and said, sorry for mass hacking and its response. When we come back we look at how a cyber security breach turned into a PR
nightmare. It's probably an understatement for this company. That's next. I just
(COMMERCIAL BREAK)
ASHER: Hello everyone, I am Zain Asher. Coming up on the next half hour of QUEST MEANS BUSINESS, the city of lights and the city of angels have
made it official they are now Olympic cities once again. And easyJet wants to take you to LA and beyond, the airline's chief commercial officer tells
me about its new long-haul plan. First though, these are the top headlines that we are following for you at this hour.
All right, so police in Hollywood, Florida are investigating the deaths of six nursing home residents in the wake of hurricane Irma, the storm knocked
out the power and air conditioning to the facility where they lived. Not the police chief says a criminal investigation is underway, more than 100
people have now been evacuated from the nursing home.
Myanmar leader Aung San Suu Kyi has canceled plans to attend this month's UN General Assembly. The Nobel Peace Prize winner is under heavy, heavy
criticism over the violence against Rohingya Muslims in Myanmar. A spokesperson says that she will deliver a speech on the crisis next week.
A suicide bombing killed a policeman and two civilians outside a cricket stadium in Kabul, Afghanistan Wednesday. The blast reportedly took place
while the game was being played, wounding at least five other people. Afghanistan has been the scene of a string of deadly bomb attacks over the
past few months.
The Trump administration is ordering U.S. government agencies to using Kaspersky products within 90 days, admitting concerns that the Russian
Internet security firm is connected to the Kremlin. Jose Pagliery joins us live now. So first and foremost, let us start with the basics, let us
start with the ABCs. What are the Kaspersky products in terms of software used for, how widely used in the U.S. government?
[16:35:00] JOSE PAGLIERY, CNN INVESTIGATIVE REPORTER: So, Kaspersky products are a very popular former software that protects your computer
like Symantec. This is like Norton antivirus. This lives in your computer and protects it from cyber-attacks. And this is pretty popular in the
United States and outside the United States, and apparently it is also used by some government agencies.
This is a pretty respectable product, a lot of people know it, it's a very good firm when it comes to research in cybersecurity.
ASHER: One minor problem though according to the United States government.
PAGLIERY: That is right.
ASHER: And that minor problem is they believe it could be linked to the Kremlin.
PAGLIERY: That's right, now, we have heard rumblings about this for a very long time, for a long time now you have heard this from intelligence
agencies, the FBI, some law enforcement sources who say that the United States government should not trust Kaspersky because the company is based
in Russia. And a lot of its top people have ties back to the Kremlin. However, we have not seen evidence of any ties that Kaspersky has to the
Kremlin that show that Kaspersky is working on behalf of the Russian government. And that is a big deal because lots of cybersecurity companies
are based outside of the U.S. and without definitive evidence that shows --
ASHER: You can't just say based on location, you actually need evidence.
PAGLIERY: Right.
ASHER: Just walk us through what is exactly the fear? The fear is that you have United States security data that could be vulnerable, and if that
is the case, and why now? Why is the U.S. government basically saying now that it is time to end this relationship with Kaspersky?
PAGLIERY: That is a good question, so I will take each question enter. The first one is what damage can be done? Well, think about what
cybersecurity software does. It lives on your computer and it monitors everything you are doing so it can protect you. This is like a security
guard outside of your building. Well, the security guard has keys, right? And so, if you don't trust your security guard --
ASHER: That is a problem.
PAGLIERY: That is a huge problem. Now, in terms of why now? Think about what happened last year, the Russian government has been accused by the
United States government of hacking into our politics. And so, considering that Russia is now very blatantly been considered an enemy state of the
United States. Can you trust software that comes from that country if the company that is based there could be pressured by the government? That is
what we are hearing from DHS now.
Now, the response from Kaspersky today has been show us the evidence. If you have got something then show it, and so far, they have not done it.
ASHER: As you were saying, it can't just be the fact that they are based in Russia, you actually have to have evidence but the U.S. government is
saying that within 90 days they have to delete the software.
PAGLIERY: And here is the other thing, if the United States government can't trust it, then surely DHS should put out some sort of statement to
the U.S. companies and U.S. civilians who use this explaining why, because if it's not good for the U.S. government it's probably not good enough for
the average American.
ASHER: Jose, you bring up a very good point, that is very true. We have to leave it there though because we are running out of time, thank you so
much.
The CEO of Equifax has broken his silence and apologized for his company's bungled response to put it lightly to a giant data breach. In an article
in "USA Today", Richard Smith said, sorry, about the mass attack or 143 million Americans were made vulnerable. He said, we apologize to everybody
affected. This is the most humbling moment in our 118-year history. Consumers and media have raised legitimate concerns about the services we
offered in the operations of our call center and website. We accept the criticism that are working to address a range of issues.
Investors reacted negatively, I was talking to Paul La Monica a little earlier, Equifax stock sunk, look at that, nearly 15 percent today. A
range of issues may be putting it lightly, I want to go through the list of missteps that Equifax made, so here goes, is a long list.
Let me reader for you. First of all, they actually waited six weeks, they waited six weeks between knowing about the hack and then making it public,
announcing it to the world.
Someone from within their communications team actually tweeted Happy Friday, certainly not a happy Friday if you are being hacked. Just a day
after it was announced.
Executives, and this is pretty troubling, executives sold shares before the hack was made public so a lot of people are scratching their heads over
that. What did they know, when, why would they sell their shares? And it chose not to directly notify those consumers who were affected, not tell
them directly.
Its response website was not immediately ready, actually took a little time before it was up and running. And he briefly asked customers to waive
their right to sue the company in exchange for credit monitoring, free credit monitoring. It also gave users easy to guess PINs and by just right
next to me is actually laughing, by the way. I am not sure if you can hear.
But anyway, and it is giving no updates for users who might be affected in the U.K. and Canada. Peter Shankman is a PR expert. He joins us now.
Peter, you were just laughing. You are distracting me because you are just laughing.
[16:40:00] PETE SHANKMAN, FOUNDER THE GREEK FACTORY: Sorry.
ASHER: So, first and foremost, listen, the CEO apologized, right, he gave a sort of full-fledged apology in "USA Today". What do you make of that?
Isn't that sort of repairing his relationship with the public?
SHANKMAN: I don't know if your mom was the same as my mom, but when I was growing up, my mom would always say, if you tell me what you did, you're
going to be in a lot less trouble than if I find out. Remember that?
ASHER: My mom was very strict.
SHANKMAN: Yes. I was never in less trouble, I was always in trouble regardless. But that is what is happening right now to the CEO. The CEO
apologized because he had absolutely no other choice, he had six weeks to apologize, he had six weeks to not make a website that said, hey, by the
way if you agree to credit monitoring, you cannot sue us. He had six weeks to instruct his social media staff how to handle it. He had six weeks to
talk to his tech team about how to actually make PINs that would not get you into trouble. And he had six weeks to actually build a website that
according to Reddit didn't do things like if you entered in Joe Smith and 1,2,3,4 as the last four digits of your social, still said that you were
hacked.
ASHER: Do you think that six weeks -- to be fair on the company, do you think that six weeks is a long time when you are dealing with one of the
biggest cyber breaches in United States history?
SHANKMAN: This is Equifax.
ASHER: A 143 million people, they need time to digest what is going on and assess the situation.
SHANKMAN: They have the data on 300 something million people in this country alone. If you are company, you know what you're doing every day
when you're not playing golf and it's not Christmas, you are working on a reaction plan. Literally, you have that plan and you are drilling. You're
having lifetime crisis drills, you are better than NASA at this.
Because you have the data.
ASHER: Or you should be.
SHANKMAN: You should be. You have the data on essentially everyone in the country if not the world, this is what you plan for, this is your day.
They have the opportunity, they could have come out heroes in this. They did not have a plan, they do not have a way to put it in -- this is not
Equifax, this Equi-fail. This is a massive Equi-fail, and all they had to do was have that in place, and they blew it. This is going to be talked
about PR classes for years.
ASHER: This was so interesting, I was sitting at my desk earlier today, and I talked into Google the words, how can, and in the related searches
the third thing that popped up was how can I sue Equifax? I don't know if we have the video of that, maybe we do, maybe we don't. I will see. But
how can I sue Equifax? That means there are a lot of people in America who are asking that very question.
SHANKMAN: Let's understand this, the premise of Equifax, people don't like credit history companies to begin with, OK, because credit companies are
essentially, these people monitor your credit, oh, you missed a MasterCard payment three years ago, too bad, you are not getting a house. So, all of
a sudden, they have a problem and we are supposed to grant them a pass? Everything that they could have done in the court of public opinion, they
did wrong.
ASHER: OK, so then how if you were their PR person, if you were in charge of their PR strategy, what would you have done differently? How it would
have gone if Peter Shankman was in charge?
SHANKMAN: This is a start, the CEO coming out is the first step. Secondly, I want someone to find out exactly what happened with the
employees who sold shares. Did they know, didn't they know? I want an outside independent investigation to that.
Certainly, I want five years credit -- I would give five years credit monitoring to every single person in the U.S. whether they were affected or
not. Because here's the thing, look, 143 million people were affected. Chances are if you have been on the Internet at all in the past 10 years,
your data has been compromised at least once. And it probably has not affected you. But the fact of the matter is not only they have your info,
they have your Social Security number. That is where it starts to get risky.
So, they need to be bending over backwards to basically be the anti-Equifax right now and say they will help you.
ASHER: There are just so many mistakes, so many. Peter Shankman, always good to have you, thank you so much, good to see you again.
EasyJet is best known for short-haul flights now that is certainly about to change, when we come back the carrier's new mini alliance which stretches
around the world, that is next.
[16:45:00] (COMMERCIAL BREAK)
ASHER: Welcome back everyone, I actually have a fear of flying, it has not kicked in just yet, these chairs are certainly very comfortable, easyJet by
the way built its brand on offering cheap short haul flights all around Europe as you know. Now, easyJet the budget carrier wants to take you
further by offering over 100 destinations through a connecting flight from Gatwick. So, they include Los Angeles, New York, even as far away as
Argentina and Canada, thanks to a tie up with Norwegian and WestJet. A little earlier easyJet's chief commercial officer Peter Duffy said this is
the beginning of a much larger route network. Take a listen
(BEGIN VIDEOTAPE)
PETER DUFFY, CHIEF COMMERCIAL OFFICER, EASYJET: We started out with two partnerships with Norwegian and WestJet for both low-cost carriers, but
that is really because they're flying out of Gatwick. EasyJet has 100 different routes into Gatwick which means we can introduce passengers from
a very, very broad area to those two airlines. But we are talking to airlines in a number of other countries about doing exactly the same at
different airports. We are talking to airlines about doing that in Gatwick as well.
So, it's just where it makes sense for both of us in terms of us providing essentially the feeder traffic in the long-haul airline having a service
that they want to be fed from a broad range of different destinations.
ASHER: So, how will worldwide by easyJet action be able to, I guess in the long term, obviously, you just started, but in the long term competing
against established network carriers especially since customer still obviously, after picking up their bags themselves between flights, and
also, I understand there is a minimum of a two and half hour wait time between flights as well. How will you compete with established network
carriers?
DUFFY: I think what is going to happen is that this will introduce new competition into the market, and so what you see is established carriers
essentially being able to charge for customers' significant premiums because they are the only people who operate certain routes. What
worldwide is going to do is introduce competition to that to enable the customer to have a choice and do that in a different way.
Now the two and half hours is just starting point, we need to make sure that this works. And really the time for the customer has to wait is the
time between the two flights. That may reduce in time if we find we can to that quicker. But really what the customer has to tradeoff is how long
it's going to take versus the price. And what we are seeing already is that the price which we are offering as a combined easyJet, WestJet,
Norwegian could sometimes be 1/3 to 1/4 of what the existing legacy carrier is charging.
ASHER: That is how you will compete with price. Just talk to us, Peter, how about the timing of this announcement and this initiative I mean why
now, would you say?
DUFFY: Now, is the right time for easyJet we have a very strong presence in Gatwick Airport, that is to say we serve 100 different destinations.
The technology enables us to leapfrog the way that legacy airlines have done that, and we can bring the itinerary together very simply for the
customer. And we utilize a product on the ground called Gatwick Connects which means the passenger is looked after by the airport, and so while they
picked their bags up off the carousel from the first leg of the flight, drop it within 20 m of that carousel into the Gatwick Connects desk. And
then that is looked after on their behalf. And then the passenger is then transited through the airport onto their connecting flight in a very simple
way. Essentially, all the parts of the mix have kind of come together, and we are able now to bring it to the customer in a way that is going to be
really competitive to what they currently have on offer from existing legacy airlines.
(END VIDEOTAPE)
ASHER: And if you want to take our show with you on your next business trip or if you have just missed part of today's program and you want to
catch up, we would love it if you did. You can now download QUEST MEANS BUSINESS as a podcast.
[16:50:00] It is available from all the main providers, or you can simply listen to us at CNN.com/podcast.
International Olympic Committee confirms not one but two cities to hold future Summer games, Paris and Los Angeles are both celebrating, we will be
in the French capital after this.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
THOMAS BACH, PRESIDENT, IOC: Ladies and gentlemen, I have the great honor to announce the International Olympic Committee has simultaneously elected
the host city of the games of the 33rd Olympiad 2024, in the host city of the games of the 34th Olympiad 2028, Paris 2024, Los Angeles 2028.
(END VIDEO CLIP)
ASHER: There you have it, the international Olympic Committee has confirmed officially that two host cities are the future of Summer games at
a meeting in Peru just a short time ago. As expected, Olympics will head to Paris in 2024 and then four years later in 2028, is going to be held in
Los Angeles. Both cities are not newbies at this, they have both hosted the games in the past.
While French sports fans celebrate, French prosecutors are still busy investigating how the last Olympics was actually awarded. Brazilian police
raided the head of the Rio Olympics house last week, Carlos Guzman is alleged to have arranged a $2 million bribe to help the city when the 2016
games. The head of the IOC says it is communicating with Brazilian authorities.
(BEGIN VIDEO CLIP)
BACH: The IOC is very committed to the integrity of our organization, this is why we are taking this seriously. And we are watching closely for the
reasons already more than one year ago.
(END VIDEO CLIP)
ASHER: Michael Payne is a former marketing director of the IOC, Michael joins us live now. Michael, when you hear of these corruption allegations,
just how much of a hit does this make to the IOC's credibility overall, do you think?
MICHAEL PAYNE, FORMER MARKETING DIRECTOR, IOC: There is no question the IOC has been going through a difficult few months as these allegations and
rumors coming out of inappropriate actions on voting for past cities. I think today looking to the future, the election of Paris and Los Angeles
really is a historic move and sets the Olympic movement on a very positive path for the future.
But when you look back at the past problems or the allegations on Rio, I think the IOC and Thomas Bach will take whatever steps are necessary to
rebuild the credibility and sanction as soon as the evidence becomes clear.
[16:55:00] ASHER: In this case, yes, they're waiting for the evidence to become clear for Guzman, just overall in general, what sort of reforms are
needed to prevent this sort of corruption at this scale?
PAYNE: It is a challenge when you look at it for any international organization, in the IOC is not immune, you look at any of the UN
organizations, and a global body that brings 200 countries together. All of the different dynamics of the cultures, it is a challenge, and you're
having to everyday fight to maintain the integrity and the ethical principles that you stand for. The problem with the Olympics is that it is
on a pedestal as the ultimate sporting occasion. It's built on these very special values, so the slightest hint of any impropriety is always very
damaging. And the IOC has to respond and take whatever action to maintain confidence for the future.
ASHER: I mean, yes, you are right, it is certainly a very challenging, especially when you're bringing people together from all around the world,
but is there anything that can be done?
PAYNE: Only operate a zero-tolerance policy at any form of inappropriate behavior. The IOC in the past has not hesitated to expel members, has not
hesitated to sanction anybody caught cheating, they sanction the athletes, they will sanction the members and the officials.
ASHER: All right, Michael Payne, life for us, thank you so much. Appreciate that.
Just time for a quick recap of the stock market today, as I mentioned a choppy session on Wall Street. It started off very choppy indeed. Then it
began to rise roughly around midday and it went on a winning streak with gains, the Dow, the S&P, and the Nasdaq were enough to push all three
indices to new records for the second day in a row. The markets in Europe ended the day mixed. Frankfurt and Paris ended slightly higher. The FTSE
three tenths of one percent weighed down by mining stocks. Zurich ended flat.
And that my friends is QUEST MEANS BUSINESS. I am Zain Asher in New York, I will see you again tomorrow, all the best.
END
