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Quest Means Business
Queen Elizabeth Approves U.K. Prime Minister's Request to Suspend Parliament; European Commission Reacts to Boris Johnson's Move to Prorogue U.K. Parliament; Italian Parties Reach Deal to Form New Government. Aired 3-4p ET
Aired August 28, 2019 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, CNN INTERNATIONAL HOST, QUEST MEANS BUSINESS: Good evening. Tonight, Boris Johnson goes prorogue. We're outside the Houses of
Parliament. I'm Richard Quest.
A controversial request from the British Prime Minister -- a request that could not be refused to Her Majesty the Queen -- to suspend Parliament.
The Queen had no choice. She had to rubber stamp. And for five crucial weeks starting early next month, MPs will be unable to do anything about
the government's Brexit plans.
It trims down their chance of stopping a no-deal Brexit from the European Union to a few short days coming up and thereafter. Now, the move is
unprecedented. The prorogue in its duration for the modern era of British politics, Boris Johnson claims he is simply bringing forward a new
legislative program. He needed to wipe the slate clean.
Critics from the Speaker of the House, John Bercow has called it a constitutional outrage. Boris Johnson denies he is trying to curtail MPs
rights.
(BEGIN VIDEO CLIP)
BORIS JOHNSON, BRITISH PRIME MINISTER: There will be ample time on both sides of that crucial October the 17th Summit -- ample time in Parliament
for MPs to debate, the E.U. debate, Brexit and all the other issues -- ample time.
(END VIDEO CLIP)
QUEST: So the new timetable leading up to Brexit. Follow carefully because this is going to be crucially important in our discussions over the
next two months.
On Tuesday, September the 3rd, Parliament comes back from the summer break. It should have been about two weeks, and then the conference season. All
the major parties have their conferences, it used to be at seaside resorts, now they go anywhere. MPs now will only have days before Parliament is
suspended. It's officially known as prorogation.
It always happens between the end of one Parliament and the start of the next session. It usually happens -- but this time, it will happen sometime
between September the 9th and the 12th.
A new session of Parliament will begin on October the 14th with the Queen's speech, barely leaving lawmakers two weeks to address Brexit before the end
of October. If nothing changes, the U.K. leaves with or without a deal.
Nic Robertson is with me. What's the fuss all about? The MPs have got plenty of time. They've got some days before prorogation. They've got
time afterwards.
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: And that's the argument Boris Johnson is making on what they would say, as look, after the
Queen's speech, this time, the short period before the European Union Council meets, which is a vital time for them to be at Parliament to be
able to discuss what it is that Boris Johnson may or may not have agreed with and what is put to them.
Part of that time is now going to be spent four or five days maybe a little more, will be discussing the Queen's speech. So you cut down time there.
You've lost days in the middle. You've lost time now because you have to discuss the Queen's speech. You have a couple of days before that meeting,
and then after that meeting, even less time.
QUEST: A constitutional expert will be with us shortly to explain what could be done. But one thing they could do is suspend all the rules. I
mean, if these people behind are so angry, and the Speaker is on their side, which it would seem to be he is, they can suspend everything and just
try and pass a one-clause bill to delay it again.
ROBERTSON: It still takes time. This is my understanding. And I think we are entering uncertain territory right now. So we don't know precisely how
it is going to go and what counter moves Boris Johnson may have.
But if you are able to take the Parliamentarians -- the opponent -- is able to take back control as he did under Theresa May, you have to move very
quickly to be able to do that. Even if it's a one-clause bill, it still has to have the number -- the normal number of debates, three debates that
it would have to. It goes to the House of Lords. It takes time. Time is what they have less of now.
QUEST: All right. But the alternative is what?
ROBERTSON: The alternative would be a vote of no confidence in the government, and when we listened to the leader of the opposition today,
Jeremy Corbyn and we listened to him yesterday as well, he was inclined to say, "Let's go with a legislative block rather than a vote of no
confidence," because there is concern in his leadership, division within his party, but that may have changed overnight last night.
QUEST: But Nic, we must also remember there are many people in this country that tonight will be saying, "Thank goodness. He's got on with it
and it's going to happen."
[15:05:01] ROBERTSON: Absolutely, there are. This country is deeply divided and one of the things -- one of the results of Boris Johnson
essentially taking the initiative here, stealing the initiative, getting to the battlefield first, is that yes, he is going to have a block of
supporters on his side, but he is also on the other side.
Some of those people protesting here tonight told me, "Look, we're middle class people. We don't normally come out and speak, but we are so
frustrated with Boris Johnson." The catch here for him is that he will have angered those in the middle ground that don't normally come out and
that could be in his party, too.
QUEST: Good to see you, sir. Thank you. The opposition is furious, one can imagine. The Labour leader, Jeremy Corbyn has called the Prime
Minister's move a smash and grab on democracy. Scotland's First Minister went further saying it shows the government has no respect for
constitutional norms.
(BEGIN VIDEO CLIP)
NICOLA STURGEON, SCOTTISH FIRST MINISTER: Shutting down Parliament in order to force through a no-deal Brexit, which will do untold and lasting
damage to the country against the wishes of MPs is not democracy, its dictatorship.
And if MPs don't come together next week to stop Boris Johnson in his tracks, then I think today will go down in history as the day U.K.
democracy died.
(END VIDEO CLIP)
QUEST: Anna Stewart is with me from Number 10 Downing Street. So John Major, the former Prime Minister was vicious in his criticism, saying that
this was just unconstitutional, what was being done, not in the mold Gladstone, Disraeli and Churchill.
ANNA STEWART, CNN REPORTER: And we're hearing that from so many different sides, Richard. We also had Philip Hammond, the former Chancellor, he
said, it was profoundly undemocratic. From the Labour Party, Diane Abbott, the Shadow Home Secretary, calling it a coup. Chuka Umunna, a Liberal
Democrats saying, "The Prime Minister is behaving like a tin pot dictator."
Huge upset, huge protests outside Westminster and outside Downing Street as well. You've got to remember this was not a day when we were expecting
anything Brexit related or anything of importance to really happen. So really extraordinary events.
But of course, lots of people, as you said earlier, did vote for Brexit and will be absolutely thrilled that the Prime Minister is delivering what he
said he would do, which is take the U.K. out of the E.U. at the end of October, no ifs, no buts. If that means proroguing Parliament's, well,
they'll be fine with that, too -- Richard.
QUEST: The one phrase I heard here at Abingdon Green just outside Westminster is the Boris Johnson has overreached himself. Dominic
Cummings, his special adviser, who is thought to be behind this has pushed him and arguably over the cliff. What's the feeling in Downing Street?
STEWART: Well, in Downing Street, and Boris Johnson and the government would argue that what he is doing here is very ordinary. When you get a
new Prime Minister, they suspend one parliamentary session, and they open up a new one with the Queen speech setting out that domestic agenda. That
is normal and you know what? The last session has been the longest for 400 years. The Prime Minister made that point today.
What is of course highly unusual, it's so controversial is the fact that the context of this is absolute political chaos. Just yesterday, knowing
that, you know, Jeremy Corbyn and the other opposition parties got together and consulted that they needed to do something to work together to prevent
the Prime Minister from a no-deal Brexit.
QUEST: Anna in Downing Street. I can hear the helicopter that was over here, and now, over where you are. Anna, thank you.
This new timetable as we were talking makes it even more difficult for MPs to try to prevent a no deal. The length of time Parliament will be in
recess is unprecedented in recent times; not hugely, but it is longer than normal, which is why some lawyers say it could be challenged in court.
Opposition parties say they will still attempt to pass legislation to ban. This would require taking over parliamentary agenda. Tricky even before
this extended prorogation. If all else fails, a no conference vote. If the government loses, one that's against the no-deal Brexit could take
over.
Joelle Grogan is Senior Lecturer in Law at Middlesex University. She knows every twist and turn of what could or could not happen. How much of a
constitutional crisis is this tonight?
JOELLE GROGAN, SENIOR LECTURER IN LAW, MIDDLESEX UNIVERSITY: So as a constitutional expert, I think we're very, very tempted to use this phrase
as much as possible. It's slightly dramatic, but simply a constitutional crisis is one in which the foundational institutions of the U.K. don't
acknowledge each other's power.
So for example, this would be if the Queen were to ignore the government or the Queen way to ignore Parliament or the Parliament were to ignore
government or governments -- and this is a tricky one -- were to ignore Parliament.
QUEST: That they are doing. That is exactly what they're doing. But you are telling me that actually, there's very little -- I mean, they can pass
debate motions, which are non-binding, but there's not a lot they can actually do unless they take control.
GROGAN: So this is absolutely it. We have -- well, the control of parliamentary time always rests with governments. But exceptionally what
Parliament can do, what the House of Commons can do is they can suspend orders. They can also bring in and emergency debates and emergency
legislation, which is I think, what we're going to be seeing in the next few days.
[15:10:14] QUEST: Okay, so let's say in the next few days, they suspend the timetable, the Speaker who clearly is on their side, grants them a
chance to get a bill through, can they get it through?
GROGAN: So the big ticking clock, quite literally is they have next to no time to do so. They have about three, five days of debate before
suspension, and on suspension of prorogation, everything on the floor dies. It starts again from zero. Also, that would have to pass the Commons and
the law --
QUEST: Hang on. Hang on, sorry. So they start the -- they started before prorogation. They've got to have finished it before.
GROGAN: Exactly.
QUEST: That's tricky. That's tricky. Can they challenge prorogation itself in the courts?
GROGAN: So what we could see another option is to try to amend the legislation which governs prorogation. We could also see emergency
legislation, which would try and switch that or change that. Because as you'll know, from your law degree, a foundational principle of the U.K.
Constitution is Parliamentary Sovereignty. We can change legislation if there's time, and if there is agreement.
QUEST: Okay. In all of this, though, I mean, I'm getting the impression that you don't think there's much that can be done.
GROGAN: So, in my legal opinion, we have a very, very limited timetable. We have such limited time. You're going to need some very quick
legislation in days.
QUEST: All right, I can see viewers watching and listening and saying, "Hang on, surely all of them in there against this just have to stand up en
masse and say to the speaker, Mr. Speaker, we need to stop this. Give us time." Overrule everything, you are the Speaker.
GROGAN: We need legislation. Legislation is key. Legislation must be passed through the Commons and the Lord with potentially as you said, that
single line "Give us more time."
QUEST: And even if they do pass legislation, let's say they ban a no-deal Brexit, what do they put in its place? Because once that law -- because
the other side to this is there is this fixed deadline of October 31st.
So if you say no deal is the new law, somebody else will say, "Well, then what do you do instead?"
GROGAN: Exactly. You can't say no to no deal, you have to have an alternative. And the alternatives remain the same. It's either a
revocation, very unlikely; accepting the deal, even more unlikely; or going to the European Council on the 17th of October and asking for a further
extension.
Now, the qualification on that is you need all Member States, all Heads of all the Member States to agree to an extension, and the question for them
is going to be why and how long?
QUEST: Right. I was in Brussels at the last one, up all night and Emmanuel Macron said no, or at least played hardball. Now, finally, Her
Majesty, the Queen. I mean, the poor woman today was put in the most awful position. She was proven to be nothing more than a rubber stamp.
GROGAN: As a matter of law, I would again disagree with you. It's a foundational principle that the Queen has the power in real terms, in
political terms, I would say there was no choice, but that would go beyond my mandate. She has the power. She simply couldn't in political terms,
exercise it as this comes back to our first point.
QUEST: You must feel sorry for her.
GROGAN: Constitutional crisis.
QUEST: You must feel -- so it is a constitutional crisis.
GROGAN: If she had disagreed with government, it would have been --
QUEST: Never argue with a lawyer, let alone, a legal academic. Really good to have you with us. Please, we're going to need you in the weeks
ahead to help us understand what's happening. Send the bill to the usual place.
Breaking News tonight. Italy, the country's rival parties have just reached a new deal to form a new government. After days of tense
negotiations, they've come to an agreement, a series of points including Giuseppe Conte returning as Prime Minister. I bet you weren't expecting
that, I wasn't. The Italian President has invited Conte to a meeting on Thursday. Barbie Nadeau -- all right, come on, Barbie. What hope? I
mean, who are the parties underneath this? If Conte is coming back, fine. You got rid of Salvini, but the other -- who is backing him?
BARBIE NADEAU, CNN CONTRIBUTOR: Well, the Five Star Movement were set on having Giuseppe Conte come back. And you know, Conte is not a political
beast. Well, he wasn't until he became Prime Minister. He is not affiliated with any of the political parties and that was sort of the
appeal of having him with the Salvini Five Star government.
Now, the Five Star likes him, and that was the deal that almost broke the deal with the Democratic Party of the left, because they didn't want Conte,
but they came to an 11th hour agreement, Mr. Conte will be going back to I guess, take back his resignation, which he gave in last week. And he'll
get the mandate to try to form a government.
Now, the devil is in the details of this one, though, because there's still a lot of work to be done in terms of putting Ministers in place and getting
these two parties to agree moving forward. But at least for now, it looks like they're moving forward and out of the current crisis -- Richard.
[15:15:05] QUEST: What is the -- come on, let's have a reality check, what does their legislative ability look like since they are parties from the
opposite ends of the political spectrum?
NADEAU: Well, they agree on one thing, and it may be enough to keep them together, at least in the short term, and that is keeping Matteo Salvini at
bay, keeping him out of the government. And he will be an opposition party and that could actually make him stronger, it could actually appease his
base. And they -- you know, he may grow in popularity. But they agreed on that, and that alone right now.
Now they'll have to find some common ground on immigration. They'll have to pass an important budget in October. They'll have to somehow have Italy
ready for Brexit, you know, at least an important part of continental Europe and all of these things, they'll have to work out and those details
may be difficult for them.
We don't know. They have to pass a confidence vote first and foremost, once the Ministers and things like that are in place. There's a long way
to go. But there is a little bit of optimism here tonight, finally, after a couple of weeks of real crisis and a dismal state of summer affairs here
-- Richard.
QUEST: Barbie, thank you. Good to have some good news, or at least some encouraging news out of Italy tonight. And so U.S. stocks are enjoying
their better session than their European counterparts. The Dow is up more than 200 points, and the world's biggest wealth manager is telling clients
to get out to the market or at least not to get too deep into it.
And we're going to assess the mood in the U.K. We asked people in the town that voted heavily to leave what they think of the prorogation of
Parliament.
(COMMERCIAL BREAK)
QUEST: The last hour of trade on Wall Street and stocks are all trading higher. It was up some 250 points, near session highs. The leaves are
falling everywhere.
Energy stocks are the biggest gainers. Exxon and Chevron are nearly at one percent and that's boosting the Dow. You can see the Dow has climbed
majestically throughout the course of the day, slow but steady.
Despite the day's gains, markets are haunted by risk. The yield curve that we've talked about so often inverted on Tuesday to its deepest levels since
2007 recession. Gold prices are hovering around their six-year highs and the CNN Business Fear and Greed Index says sentiment is in extreme fear.
[15:20:12] QUEST: According to the manager behind the world's biggest wealth fund, those risks, especially from the impact of the U.S.-China
trade war are only now set to increase and that will negatively affect equity values.
I asked the Global Chief Investment Officer, Mark Haefele to explain the UBS decision to now have a recommendations on stocks underweight.
(BEGIN VIDEOTAPE)
MARK HAEFELE, GLOBAL CHIEF INVESTMENT OFFICER, UBS WEALTH MANAGEMENT: There's a lot of geopolitical noise around. But we look very hard at the
data and what we're seeing in the data is that the tariffs are starting to impact the data around manufacturing, there's a manufacturing slow down.
And now we know that there are going -- most probably and we think very probably that there are going to be tariffs that start to impact the U.S.
consumer. And we have an increased concern that the slowdown for manufacturing could expand to the much broader consumer sector in the
United States, and at a minimum, this kind of detraction or reduction in the data means that any recovery back to trend growth for the U.S. economy,
and indeed the global economy could be postponed. And that raises the chance that equities are unlikely to do as well as they have in the past.
QUEST: You know, what we saw during the crisis, various crises is that in a low interest rate environment, people went into equities, specifically,
because the returns were better, both at the dividend yield or indeed, obviously, capital appreciation. Now you are you saying, say for the next
two or three years, you do not see that level of growth in equities?
HAEFELE: Well, you're right to raise this point. We're making more of a tactical call, we have a six-month view, and we're saying over this next
six-month period, we think it could be a rocky road for equities.
We believe that things like the Federal Reserve cut that should be coming, and the potential for further fiscal and monetary stimulus globally will
provide support to the global economy and to the U.S. economy, for example.
But that takes a while for that to kick in, even though the Central Banks have started on that. In the meantime, some of these trade tensions could
flare up.
QUEST: And I see you're looking for 75 basis point cut from the Fed when you've had 25 so far. So do you think it's two more quarters, or one 50
and be done?
HAEFELE: Another great question. I would say after listening to some of the commentary at Jackson Hole last week, the Fed is likely to go only 25.
QUEST: Britain is now headed, it would seem tonight for a full-fledged constitutional crisis over the government's decision to prorogue
Parliament, to suspend it for a couple of weeks. I mean, is the financial world tired of Brexit? Is it just another uncertainty?
HAEFELE: Well, to see, as you described a constitutional crisis at the heart of you know, one of the most cherished democracies in the world is
something that everyone is paying attention to. I think that we believe at this time that this is not going to lead to a no-deal Brexit, which is what
financial markets are not looking forward to.
I think that, you know, it's important to keep in mind what we know at this time that Parliament, which is -- it seems the majority is against a no-
deal Brexit will have an opportunity to raise those objections. They haven't been completely blocked out of that.
(END VIDEOTAPE)
QUEST: President Donald Trump is attacking critics of his China strategy. He tweeted today, he said, "They have tried to handle it before and failed
miserably. In fact, they got taken to the cleaners. We are doing very well with China."
The Business Roundtable says the U.S. and China need to get back to the negotiation table to avoid further escalations. Rich Lesser is the Chief
Executive at the Boston Consulting Group, a member of the Round Table. He joins me now from New York.
Didn't last week expose just how difficult it is to have any form of certainty with such a mercurial President?
RICH LESSER, CHIEF EXECUTIVE, BOSTON CONSULTING GROUP: I think the uncertainty has gone on for longer and have been more intense than people
expected. I don't think anybody expected a negotiation between the U.S. and China to be an easy thing. So that was pretty understood.
But I think, the uncertainty and volatility that we've experienced have started to weigh on people and certainly weigh on businesses, which is
experiencing that uncertainty, which had originally chalked up to just tough negotiations as something that might really lead to tariffs and a
trade war of some duration. And I think it's starting to affect business confidence and investment and potentially the planning for investment
looking into the New Year.
[15:25:19] QUEST: Are your clients actually telling you, "You know we'd like to do this deal, we'd like to build this factory or do this expansion,
but we're just not going to do it now."
LESSER: I think our clients are just staring at a world with uncertainty around the world. You were just talking about what's going on in the U.K.
a couple of minutes ago.
But I think as it relates to China, I think our clients are looking at that and it does create more hesitancy about knowing how to think about
investment, looking into the New Year, and even consumer confidence which has been the bedrock in the U.S. economy, and the spending that it's led
to, you start to worry if the tariffs fall through, if farmers continue to be hit quite hard that that it will really start to sap the energy on the
consumer side.
So yes, I do think there is an impact that if this uncertainty doesn't wane, I'm thinking about investment into next year.
QUEST: Many believe that it is just about inevitable that the next round of tariff increases will take place. I suspect you're sort of hoping that
they won't, but expecting they will. So what are you going to tell your clients? How do you tell them to navigate this?
LESSER: So, I'm not sure any of us can predict what will take place and what won't take place. If there's been one learning over the last year,
it's trying to predict is a really difficult challenge. And what we have been saying to our clients, and what we continue to say, is you need to
think about today's world from the standpoint of flexibility and adaptiveness, and realizing that the world we're in means you have to have
some no regret moves and understand the direction of the world and prepare for that, and at the same time, be ready to respond aggressively if
something really does get lumped down and something like tariffs really does hit.
QUEST: Rich, I'm not trying to take you into deep political waters, but you've got enough management experience and consulting experience. When
the President says as he did at the G7, questioned about this on the one hand and that on the other hand, he said, "That's just the way I
negotiate." Is that a sound way to negotiate?
LESSER: We will only know looking backwards. It's certainly not the way that I think world leaders have negotiated with each other over many years,
and I think in particular with China. Many who have negotiated have felt that doing so much in the public domain and making it feel like such a win-
lose situation in public has not been the way to move things forward productively.
Now, the President has certainly been driving that hard. It hasn't yielded an agreement to date. I think there's a lot of concern about where it will
take us. But I don't think he is likely to change. I think he has been very clear in both his actions and his words, and then we'll see how it
plays through. But I think it is concerning. I think it is raising genuine, high levels of uncertainty, certainly on the business side,
certainly in the agricultural community.
And so far, not so much on the consumer side, but maybe some early signs. Hopefully not. As I said, that's been the real bedrock around the economy
here.
QUEST: Good. Good to see you, sir. Thank you. Thank you for joining us.
LESSER: It's a pleasure to see you, Richard.
QUEST: My apologies, I am not in New York.
LESSER: I hope, we will be in person the next time.
QUEST: To be with you face-to-face. Thank you.
LESSER: Take care. Bye-bye.
QUEST: Thank you. When we return, Boris Johnson gets the Queen's go ahead to suspend Parliament. Now of course, we factor in what it means for a no-
deal Brexit.
(COMMERCIAL BREAK)
[15:30:00] QUEST: Hello, I'm Richard Quest outside the houses of parliament where we've heard the developments in just a moment after I've
updated you with the news headlines.
The queen has approved Prime Minister Boris Johnson's request to suspend parliament next month. That would limit the time the MPs have to debate
the Brexit deal. The opposition, the Labor Party calls the move an affront to democracy. Boris Johnson says there will be ample time to debate Brexit
before October the 31st deadline.
A spokesman for the European Commission refused to speculate on how Johnson's move would impact Brexit talks. The European parliament's chief
negotiator called it sinister, he said he feels solidarity with British MPs who want their voices to be heard.
A political breakthrough in Italy tonight, the country's rival parties have reached a new deal to form a government, many days after they've come to an
agreement and series of points, including keeping Giuseppe Conte as Prime Minister. Italian president summoned Mr. Conte to a meeting on Thursday to
see if he'll take the job.
Dorian has now grown into a hurricane strength and is lashing the British and U.S. Virgin Islands with heavy rain. Puerto Rico is still ravaged by
2017's Hurricane Maria is bracing for Dorian, it may dodge the worst of the storm. Officials say an 80-year-old man was killed there when he fell off
his roof while getting ready for the storm. Dorian could hit parts of the southeastern U.S. coast by Monday.
Returning to our top story, MPs are divided over Prime Minister's plans to suspend parliament. I spoke to Hilary Benn who is a Labor MP who chairs
the House of Commons Brexit Select Committee. He said stopping the suspension of parliament would be difficult, stopping a no-deal Brexit is a
different matter.
(BEGIN VIDEO CLIP)
HILARY BENN, MP, BRITISH LABOR PARTY: When it comes to preventing a no- deal Brexit, which is the big issue, then I think parliament can do something about it because we demonstrated back in the Spring by passing
legislation in a day against the government wishes, we forced Theresa May, the then Prime Minister to seek for the extension to Article 50. And if
we've done it once, we could do it again.
QUEST: Is there sufficient time in the days remaining under the new schedule to do that?
BENN: If there are sufficient votes in the House of Commons, then I think that is possible. None of this is certain, but the window for acting is
now next week and the week after.
QUEST: It is farther.
BENN: Yes, absolutely.
(END VIDEO CLIP)
QUEST: Now, we want you to join the conversation -- join us, please, cnn.com-slash-join. Who holds the most power in the Brexit crisis? Boris
Johnson, the members of parliament or the European Union? Think about it carefully.
[15:35:00] It's not as easy as it sounds. The EU, but yes, they could end up facing a no-deal Brexit. Boris Johnson, he's got his prorogue and he
could force it through, but he may lose the general election. MPs have the final say in many ways but do they really? Cnn.com-slash-join and to see
the results on your screen.
And you can already see -- oh, nobody likes members of parliament at all, zero. Britain analyst Carole Walker is with me -- wow, this is really a
turn-up for the books.
CAROLE WALKER, FORMER POLITICAL NEWS CORRESPONDENT FOR BBC: Yes, absolutely. And Boris Johnson will know that this was always going to
provoke outrage amongst his political opponents. You have had his political opponents accusing him of a constitutional outrage, of defying
democracy, an abuse of power, acting like a dictator.
But I think it is worth remembering, Richard, that for three of those four and a half, five weeks under which Boris Johnson plans to suspend
parliament, parliament wouldn't have been sitting anyway because for three weeks, parliament is suspended while MPs go off to their political party
conferences.
But if that had happened, the government would have had to come to the house and say, well, we're going to have the usual suspension for three
weeks and people could have voted against that. What's happened now is that the government has already got the approval of the queen, parliament
to be prorogued and that severely restricts the amount of time for people who are trying to stop Boris Johnson leaving without a deal --
QUEST: But --
WALKER: It restricts their time to go to parliament and try to go through measures to stop him.
QUEST: The number of days was few between the return and the October 31st. That there may only be three days lost, but they are considerably --they
have greater weight because time was so tight.
WALKER: It was probably at least four and a half, maybe more, depending on exactly when proroguing action begins --
QUEST: Right --
WALKER: You know, that's going to happen the week beginning September the 9th. There's also the fight that of course Boris Johnson has announced the
queen's speech, that is when a huge pump and ceremony, the government's new program is announced. Boris Johnson has said this is all about doing
things as a new Prime Minister should, announcing his programs to parliament.
QUEST: Do you believe him?
WALKER: But of course, the other factor of that is that a queen's speech is usually followed by five days of debate on the queen's speech. So, that
further limits the amount of time for MPs to try to --
QUEST: Right --
WALKER: The parliamentary timetable and try to stop a no-deal Brexit --
QUEST: The speaker is the one who called it a constitutional outrage. My guess is that if MPs tried to limit or abandon the five days on the queen's
speech -- because the MPs can, they are supreme, they can get a motion to limit, restrict, whatever, then this is a mess.
WALKER: Well, look, this idea that we used to have a speaker who was impartial and above the political fray is totally out of the window. John
Burkhardt(ph) has made it absolutely clear that his sentiments lie with giving parliament --
QUEST: Yes --
WALKER: The time to debate. And if it chooses to do so, to stop Brexit, but it's going to be very difficult technically for them to find a way to
do that and to agree a way of doing that.
QUEST: Now, members of the public are voicing their opposition -- thank you, Carole -- and by the way, look at the -- look at the votes there, you
see how it was. Members of -- signed a petition. More than 790,000 people have signed a petition against suspending parliament.
The British parliament considers all petitions where more than 100,000 signatures worthy of debate. Hadas Gold is in the town where a majority
voted to leave the EU, she joins us in Romford in Essex, that's a quiet Summer evening there tonight -- well, few of them are in the pub -- I mean,
are having a bevvy more like since it's only half past -- half past 8:00.
But what do they think there? Did Boris Johnson just commit a constitutional outrage and a coup?
HADAS GOLD, CNN BUSINESS REPORTER: Well, Richard, Romford as you said is a big pro-Brexit area, this area voted 70 percent in favor of leaving the EU
in the 2016 referendum. This is a big market town. There was a huge market today every Wednesday and we walked around the town talking to some
people, some people at the market about how they feel about the suspension of parliament.
What this has done is a way to get Brexit through and whether they agree with that tactic. And for a lot of the pro-Brexit people we spoke to,
they're OK with it, they understand that it's a drastic measure. They understand that it's unusual. But to them, it's one of the few options
they think the Prime Minister had left in order to just force Brexit through on October 31st, do or die, as he has promised. Take a listen.
(BEGIN VIDEO CLIP)
GOLD: What is your opinion on the news today that Boris Johnson has convinced the queen to suspend parliament?
UNIDENTIFIED MALE: Well, as he get -- it's Brexit for all that moment --
GOLD: Whatever -- so, in your opinion --
UNIDENTIFIED MALE: Whatever gets Brexit through, this is what the people voted for including myself.
[15:40:00]: GOLD: Would you be OK with a no deal as Boris has said, do or die on October 31st?
UNIDENTIFIED MALE: Yes, because I think what we voted for was to allow this -- Europe pool to come out, and it was a simple vote. And we voted to
come out. So, I'm not really too worried whether we get a deal or not.
UNIDENTIFIED MALE: We had a referendum, we voted and we voted to leave. And we just need to carry on with the people's wishes.
GOLD: So, you're OK with the idea that the suspension of parliament will prevent people from trying to block Brexit?
UNIDENTIFIED MALE: I would say, there's so many twists and turns, isn't it? So, I mean -- until the outcome we want now really, no one will know.
(END VIDEO CLIP)
GOLD: And Richard, what I found most notable in talking to people here, as I asked them, you know, some people say -- some politicians say that the
2016 referendum did not give them a mandate to leave without a deal. When in fact a lot of the people who voted for Brexit said that is actually what
they thought they were voting for.
They're OK with a no deal, and they understand that there might be some pains in the United Kingdom, there might be some pain in the economy, but
they think that, that pain will be short term. The country overall will be stronger and better off after Brexit. They just want to get it done,
Richard?
QUEST: Hadas in Romford, England, thank you. Now, Carole, just really -- who holds the most power, Boris Johnson, 29 percent, members of parliament, 13 percent, European Union, 58 percent says the good QUEST MEANS BUSINESS
viewer. Surprised?
WALKER: I think the QUEST MEANS viewer -- viewers are pretty astute because Boris Johnson has somewhat wrong-footed parliament, they've got
very --
QUEST: Yes --
WALKER: Very good time to act, even if they compel him by managing to seize the timetable, pass a law to seek a delay from the EU. The EU can
still turn around and say, hey --
QUEST: All right --
WALKER: Now you guys have decided to leave, now we know you, Boris Johnson, doesn't really --
QUEST: Yes --
WALKER: Want an extension. We're not going to grant you an extension anyway.
QUEST: All right, not a laughing matter actually, but thank you. The Sackler family maybe saying goodbye to Purdue Pharma, a new report says
they're offering to step down as owners in a multi-billion dollar settlement. That's after the break, it is QUEST MEANS BUSINESS tonight
live from Westminster.
(COMMERCIAL BREAK)
QUEST: The Sackler family is reportedly offering to give up their ownership of Purdue Pharma as part of a $10 to $12 billion settlement.
[15:45:00] On a potential deal could settle more than 2,000 lawsuits against the company. Purdue is accused of misleading the public about the
addiction risks of its prescription painkiller Oxycontin. Alexandra Field is with me from New York. Selling their stake -- or at least, putting 3
billion or so -- $2 billion to $3 billion of their own money. But what advantage does it give if they -- if they sort of break with the company?
ALEXANDRA FIELD, CNN CORRESPONDENT: This could protect them in the future from additional claims. That seems to be the thinking here, that they
leave the company, that they put $3 billion of their own money and that this becomes part of a much larger settlement, some $10 to $12 billion and
that it seems would resolve these thousands of outstanding claims, allegations that the company fueled the opioid crisis with its promotion
and marketing of Oxycontin.
There's a federal trial, Richard, that is set to kick off in October, it involves claims from 2,000 cities, counties, municipalities, all saying
that Purdue and other pharmaceutical companies need to be held responsible. So, this would put an end to Purdue's role in all of that, and we're still
waiting to see what this would mean for various states that are also in the process of suing Purdue, alleging the same thing.
QUEST: I mean, I'm assuming Purdue will only do this if it's a one-shot wonder. You know, that you get rid of it all. You can't have everybody
coming back for another bite at the cherry.
FIELD: Yes, that absolutely is the thinking here. We know that attorneys from both sides in this federal lawsuit are scheduled to update the judge
on settlement talks by this Friday. We should have some more details and some more clarity on the kind of settlement that could be reached here.
But yes, Richard, you're talking about a whopping number, this $10 billion to $12 billion. So, certainly, Purdue's perspective here would be that
this would be money that would address all of these claims that are coming at the company now and potentially down the road. It would, of course, it
almost goes without saying, be the largest settlement in any of these opioid cases.
QUEST: Right, but, you know, Alexandra, when you think about tobacco and it took decades for tobacco to finally cough up the very large sum of
money. This has happened relatively -- I use that term advisedly, relatively quickly.
FIELD: Sure, relatively. And look, Purdue has been facing allegations along with a number of other pharmaceutical companies for years now. They
put out a statement with regards to the negotiations on this new settlement, saying that they are prepared to vigorously defend themselves,
but they don't see any good coming from spending years in litigation.
They may also be reading the tea leaves here, yes, these talks about these possible settlement have been going on for months, but they've also got to
be looking along with other pharmaceutical companies about what's happened in Oklahoma just this week.
For the first time, you saw a state judge side with the state, saying that another pharmaceutical company Johnson and Johnson was responsible for
fueling the opioid epidemic in that state and saying that Johnson and Johnson would need to pay up to the tune of $572 million. Purdue of course
has settled other lawsuits when it has faced similar allegations. So, this is something they've done before, certainly not at this scale or scope.
QUEST: Good to see you, thank you. As we continue proroguing parliament was commonplace in the area of kings and queens. Now, King Charles I did
it, and he prorogued the parliament for 11 years in the 1600s. By the way, there's a statue over there to commemorate him. With the five-week
suspension, Boris Johnson appears set to smash the modern record, days before the Brexit deadline.
[15:50:00] (COMMERCIAL BREAK)
QUEST: Boris Johnson's decision to prorogue or suspend parliament for five weeks in the run-up to Brexit is unprecedented in recent times.
Historically, kings and queens regularly prorogued to limit parliament's power and suit in the queen's -- in the crown's politics. The closest
modern comparison though, let's bring it up to date, 1997, John Major suspended parliament for 19 days before a general election.
His critics said he did it to avoid publication of a corruption report about his own MPs. More than 20 years later, the former Prime Minister
says proroguing parliament over Brexit is dangerous territory.
(BEGIN VIDEO CLIP)
JOHN MAJOR, FORMER BRITISH PRIME MINISTER: If I look back through British history, I cannot imagine Mr. Disraeli, Mr. Gladstone, Mr. Churchill or
Mrs. Thatcher even in their most difficult moments saying, let us put parliament aside while I carry through this different -- difficult policy
that a part of my party disagrees with. It is fundamentally unconstitutional.
(END VIDEO CLIP)
QUEST: John Van Reenen is professor of economics at MIT, he says a no-deal Brexit is a battle for the soul of Britain. Why?
JOHN VAN REENEN, PROFESSOR OF ECONOMICS, MIT: It's about the soul of Britain. I think today, Boris Johnson has prorogued parliament to stop
there being a debate over preventing no-deal Brexit. A no-deal Brexit is opposed by most members of parliament and opposed by majority of the
British public. Nevertheless, is doing this, and I think it's an assault on the democracy and I think it's also something which is going to have
very serious economic consequences on the people of this country.
QUEST: But he's going to get -- at the end of the day, he says there's ample time to debate it. We know what the options are, they are to move or
they don't. If Europe will not get rid of the Withdrawal Agreement, and he doesn't want the -- and parliament, of course, as you remember from the
Summer, said no to everything but didn't say yes to anything except a one- clause bill, this has to happen.
REENEN: I mean, people do not want a no-deal Brexit. I think when people voted three and a half years ago, nobody knew quite -- knew what Brexit is.
Now, we have a better idea of what Brexit is. We should bring it back to the people so they can choose what type of Brexit they want. I don't think
anybody wanted this extreme Taliban wing form of Brexit which is going to be crashing out of a relationship we've had for 46 years with no back up at
all --
QUEST: The country -- well, how bad will it be? Because you are fairly apocalyptic in your predictions on what you think would happen, and yet the
other side say it's absolutely going to be nothing as bad as that.
REENEN: Well, I think there's a broad consensus across experts and people who have looked at this, even the government's own leaked reports said the
most likely situation for a no-deal Brexit is going to be serious disruptions of medicines, of food supply transport --
QUEST: With respect, it didn't. It did not say it was likely. That report which then was subsequently pointed out to be a worse-case scenario.
REENEN: I think this -- well, we can -- we can respectfully disagree on that. I think though even worse, worse case scenarios --
QUEST: OK --
REENEN: Than that. But anyway, the point is that in the short term, I think there's undoubtedly going to be a hit to the economy. But people
say, he'll be more optimistic --
QUEST: Yes --
REENEN: He will be a kind of bounce back. Now, I think there will be some recovery, but I think the worst effects are going to be in the long run
because in the long run, Britain outside the single market, the largest single market on the face of planet earth, outside the Customs Union, so
therefore tariffs, 10 percent against cars, this is going to have a much longer negative term impact over Britain which will take decades to see.
[15:55:00] It will be bruises that we don't see very directly, but it will accumulate and actually be worse in the shorter-run impact.
QUEST: Do you not think though we need -- I mean, once the free trade agreement is in place, both sides have an incentive, the EU and the U.K.
have an incentive to put in place a strong free trade agreement.
REENEN: Well, I think eventually, a free trade agreement will be signed. That can take years, I mean, Canada, it took seven years --
QUEST: Yes --
REENEN: To do, it may take a very long time to do. And the free trade agreement is no substitute for the deep relationship we have with the
European Union. You know, a free trade agreement maybe you'll get, you know, low or zero tariffs, but the great thing about the single market is
by having similar regulatory alignments, you can get free trades not just in goods, but also in services.
That's actually been one of the things, in my view, which revolutionized the British economy. Britain was a sick man of Europe in the 1970s, and
over the next 30 or 40 years, it wasn't just because we're in European Union, but it opened up markets which enabled us to actually --
QUEST: Right --
REENEN: Look beyond our old empire and look towards the future.
QUEST: Good to see --
REENEN: So, I think it's going to be a very serious thing.
QUEST: Good to see you, sir, thank you. Please, as this moves forward, come back again.
REENEN: I'll be very happy to --
QUEST: And help us understand exactly the machinations of what's taking place. So, to the pound which took a hit after news that parliament could
be suspended, it was down as much as 1 percent against the dollar, it's since recovered some of its losses in the short term.
And if we take a look at how the markets are trading on Wall Street, the Dow has maintained its gains after an early dip into the red. We were down
at the beginning but as you look, energy's financials are at the best of the day -- no, I almost said at the best of the day -- can't complain, 1
percent on the back of yesterday, not bad indeed, not bad at all.
Johnson & Johnson is at the bottom after the Tuesday court ruling, it's given back some of those gains. Dow at the top, you see the Dow 30 most in
the green. We'll have a profitable moment after the break.
(COMMERCIAL BREAK)
QUEST: When I was doing my law degree, I was told the building behind and the people in it were supreme. They were sovereign, they were the ones who
had the final say. Today, we learned that they can be pushed aside by a government determined to push through a policy.
I'm one of the persons who suffered today. Her majesty, the queen, she was told she pretty much had no choice, proroguing was on the card -- oh, and
by the way, we're all coming up to balmorals so that you can sign the papers. It's not exactly a good way to run a government, we'll see how it
puns out in the weeks ahead.
And that's QUEST MEANS BUSINESS for tonight, I am Richard Quest at Westminster --
(BELL RINGING)
Whatever you're up to in the hours ahead, I hope it's profitable.
END
END
