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Quest Means Business
U.S. Loses 20.5 Million Jobs In April, Worst Jobs Report In History; Stocks Higher Despite Record Job Losses In April; Some California Counties Rejecting Several Restrictions; World Marks 75 Years Since Allied Victory In Europe; U.S. Economy Suffers Biggest Job Losses In History; U.S. Vice President's Press Secretary Tests Positive For Coronavirus. Aired 3-4p ET
Aired May 08, 2020 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[15:00:19]
RICHARD QUEST, CNN BUSINESS ANCHOR: An hour to go before the end of trade on a busy day on Wall Street. There's an enormous amount of economic news,
corporate news, all sorts of things to bring you over the course of the next hour.
Look at the way the market has traded. The Dow Jones Industrials is up very sharply again. It's a strong day. Up nearly one and a half percent, 351
points, well over 24,000. That's the market and these are the stories behind it.
Unemployment in the United States hits the highest level since the Great Depression, somewhat perverse, some might suggest that the market is doing
so well as a result.
In California, the country's largest state economy begins to reopen.
And while companies are shedding jobs, the stock market soars. We need to understand exactly what's going on there.
Live from New York. It is Friday. It's the 8th of May. I'm Richard Quest. Rainy day in New York, but I still mean business.
The numbers are simply dreadful when the U.S. government today announced the latest jobless numbers, an unemployment rate of 14.7 percent, more than
20 million people having lost their jobs since this crisis began just in the month of April alone. And what was particularly staggering about this,
it was better than expected.
The question of course, how many jobs will return as and when the economy starts to reopen. The unemployment rate went from a five-decade low to the
highest since the Great Depression.
The White House Economic Adviser says the official unemployment rate could be around 20 percent in May. So, as I said, not as bad as had been thought,
but we'll discuss over the next 10 minutes or so, this doesn't really tell the whole story because there are some people counted within, others who
are not, and there's still another group of people who can be made unemployed in the not too distant future.
CNN's Chief Business correspondent is Christine Romans.
(BEGIN VIDEOTAPE)
CHRISTINE ROMANS, CNN BUSINESS CHIEF BUSINESS CORRESPONDENT: The numbers are really just unprecedented and the speed with which this job market has
unraveled is just unbelievable. I mean, look at the jobs losses in the past two months, 21.3 million jobs lost.
It took months during the Great Recession to ultimately lose 8.7 million jobs. And that was so bad, that recession got its own nickname, the Great
Recession.
This is single month of job loss is far and away the worst we have ever seen, certainly a record and it's ten times worse than the previous record
back in September of 1945 when Japan surrendered and America's Industrial War machine wound down.
That's right. Our comparisons are to wars and the Great Depression here. The difference is this is something we have done on purpose to try to fight
a health problem.
No playbook for how we get out of this, but what we can see here is where the damage is concentrated. Black unemployment was a record low two months
ago. It has spiked now to 16.7 percent. Also spikes in the unemployment rates of women and teenagers. Half of restaurant workers lost their job in
the month of April.
And when you look at the sectors, you can see the pain was widespread, healthcare losing jobs again as so many doctor's offices are closed,
dentist's offices are closed and that hospitals are reserved for emergencies only, not for elective surgeries.
Overall, this is a devastating picture of what American families are going through right now. Every single one of these numbers is someone who has
lost a paycheck, struggling to find out how to apply for unemployment benefits, trying to teach their kids at home, take care of their parents
and wondering what the job market and the landscape is going to look like on the other side.
(END VIDEOTAPE)
QUEST: Now, the important -- Christine Romans there.
One important point is that the number that we're seeing, as I said does not include everybody in terms of those who are out of work, underemployed,
or have decided to stop seeking work.
Out of the officially unemployed, and then the people working part time for economic reasons. And those who want a job but haven't looked for work in
the last month or in the last year, you've got 43.2 million people. That's more than the entire population of California.
[15:05:04]
QUEST: Robert Reich is the former Labor Secretary under Bill Clinton, author of "The System: Who Rigged It, How We Fix It." And he also joins me
I think from California.
Mr. Secretary, the way you put it, I'm reading your tweets, 14.7 unemployment rate. It doesn't include those that are actively looking for
work, or anyone who said they are employed, but absent from the work for other reasons. We know why this number is so bad. What troubles you most
about it?
ROBERT REICH, FORMER LABOR SECRETARY UNDER BILL CLINTON: Yes, well, Richard, there's nothing good about it at all. And what troubles me is how
difficult it's going to be to get out of the trough we are in.
This deep, deep recession, depression, whatever you want to call it was not brought about like, the Great Depression or the Great Recession of 2008-
2009. No, this was brought about by a pandemic and the pandemic is still with us.
In fact, in the United States, the rate of deaths keeps on rising, even though many states are relaxing their stay-at-home rules, and that means
that a lot of consumers are going to be reluctant to even begin to go to the malls or into airplanes or into any place where there are a lot of
other people.
It also means that many workers don't have money, which means that they can't buy even if they wanted to. So, this is going to be -- it is going to
take some time to get out of this trough.
QUEST: You said as well, in your various tweets, "As 30 million Americans file for unemployment, billionaires got 282 billion richer in less than a
month." I'm assuming that's because the stock market has gone up so much and the various plans and points that have been put in place. You say also
tax the rich. What do you mean by that?
REICH: Well, the coronavirus bills that have come out of Congress, although have been helpful, they also have included some tax cuts for the very, very
wealthy, and some bailouts of the very, very wealthy and big corporations, and that's unnecessary.
All of the money -- and we shouldn't be cutting taxes of the very wealthy right now -- all money should be directed where it's most needed and where
it's most needed is to middle class, working class poor people who desperately right now have got to have money to pay the rent and to get
food on the table and to protect their families. That's the number one priority.
QUEST: What does that mean, though, in terms of the next action? I mean, the economies are reopening and that creates its own issues of healthcare
safety, which we can put to one side, but for this let's concentrate just on the economics of this. What policies do you now want to see as reopening
gets underway?
REICH: Well, two things, Richard, number one, as I just said, you've got to get money into the hands of average people, working class and poor people,
because they're the ones who is spending and is necessary to get the economy going again.
In the United States, about two thirds of economic activity is consumer spending, not government, not exports. I mean, it's got to be consumers.
They cannot do that, given that they've lost their jobs and that there's been such a remarkable downturn, about almost 60 to 70 percent of Americans
live paycheck to paycheck.
If they're not collecting a paycheck, it means that they just simply don't have the wherewithal to continue living and buying and fulfilling the
necessities of life.
And the other thing that is absolutely critical, you said a moment ago, let's put the pandemic -- let's put the health crisis to one side. You
can't put to one side. This health crisis is the biggest single obstacle to the economy getting back on track.
As long as people are afraid, as long as the number of deaths and the number of infections keeps on rising in the United States, there's no way
that the economy can really successfully reopen.
QUEST: Right, no, I get that. But what I'm talking about is what sorts of real policies do you have to introduce, for instance? Do you think there
should be another helicopter money direct to Americans in terms of spending? Do you think they should delay -- the I.R.S. should delay once
again, the tax filing deadline from -- it was from April to July, now maybe until September-October to keep more money in the economy?
What practical policy would you implement to help encourage that consumer side of the economy?
REICH: Well, the most important practical policy for consumers right now in terms of getting money into their pockets would be to do something that
some other countries in Northern Europe have done.
[15:10:10]
REICH: And that is to get money to people by basically giving money to businesses that promise to keep people on their payrolls, even though
people are staying home. But that kind of direct payment to businesses is something the United States has tried to do, but it did it through the
banks.
And once you do it through the banks, you have the problem that we ran into, and that is the banks basically favor their own customers and give a
lot of the money to bigger businesses rather than small businesses, and also raked off a substantial amount of money, $10 billion for themselves.
No, you can do it much more directly by using direct deposit, just, you know, the way in which a lot of Americans, a big, big majority of Americans
are actually using direct deposit in the other direction for years, and that was with regard to withholding from their paychecks.
Just reverse that process, get the money directly to Americans right now.
QUEST: Use the Tax Code, use the I.R.S. and use the facilities that's already there and that have been tried and tested over many, many decades,
as we all know if you have to pay everyone. Thank you, Professor. Good to have you, Mr. Secretary. Thank you very much, indeed. Robert Reich joining
us.
REICH: Thank you.
QUEST: The lowest paid workers have been the hardest hit. That's what the statistics show about and perhaps, it is not surprising. If you look
underneath the numbers. It makes very sobering reading.
Nearly half of restaurant and hospitality jobs have gone as Christine Romans was saying. The services and retail suffered, too. Healthcare --
people even stopped visiting doctors and the dentist offices for good reason that they were closed.
Food banks have been overwhelmed and what's perhaps extraordinary here is there are many new faces in line. People who had in the past either
volunteered or donated food to food banks now find themselves in the lines waiting to be the recipients. CNN's Kyung Lah reports on this from Los
Angeles.
(BEGIN VIDEOTAPE)
ARMAN SARIAN, SMALL BUSINESS OWNER: It is hard, emotionally, financially. Everything. Our life has changed 180 degrees.
KYUNG LAH, CNN SENIOR NATIONAL CORRESPONDENT (on camera): And it happened overnight?
SARIAN: Overnight. It happened overnight.
(END VIDEO CLIP)
LAH (voice-over): Arman Sarian tells the story you hear again and again at food banks across today's America. He pulled up for free food in his BMW.
Until coronavirus hit, his Los Angeles printing shop more than supported his family of four.
(BEGIN VIDEO CLIP)
LAH (on camera): Are you scared?
SARIAN: Yes, but as a household of the family, I don't show it. I have two teenagers to raise up. We have to keep up the good spirit, but we're all
scared.
(END VIDEO CLIP)
LAH (voice-over): The lines of the needy and the numbers of unemployed all harken back to the darkest time in America's economy, the Great Depression.
Like then, this downturn touches millions upon millions. Entire industries halted like air travel.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: I miss you.
UNIDENTIFIED MALE: I miss you.
(END VIDEO CLIP)
LAH (voice over): Cruise ships, tourism and theme parks and retail and restaurants. From Las Vegas to Main Streets across the country -- gutting
jobs.
(BEGIN VIDEO CLIP)
LARRY HARRIS, USC MARSHALL SCHOOL OF BUSINESS: Think about five fingers, 20 percent is one out of five. So, one out of five people in the United States
who wants to be working is no longer working and that's jaw dropping.
(END VIDEO CLIP)
LAH (voice over): But there is a difference with today's economy.
(BEGIN VIDEO CLIP)
HARRIS: We know exactly what's causing the job loss. In the Great Depression, people understood there wasn't enough money but they didn't
really understand why.
(END VIDEO CLIP)
LAH (voice over): A vaccine, a medical breakthrough could help put this father back to work.
(BEGIN VIDEO CLIP)
LAH (on camera): Have you ever had to do anything like this before?
UNIDENTIFIED MALE: No. This is the first time for me.
(END VIDEO CLIP)
LAH (voice over): He is a writer and actor in Hollywood. An estimated 750,000 jobs in California have been impacted as the entertainment industry
suddenly stopped.
Driving up with his son, he said he wanted to talk in support of the L.A. regional food bank, but only if we didn't use his name.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: I think it's difficult for a lot of us to try and provide for our families and you know, still maintain some dignity. So,
once you realize you're not going back to work for a while, it's pretty heartbreaking.
(END VIDEO CLIP)
LAH (voice over): Kyung Lah, CNN, Glendale, California.
(END VIDEOTAPE)
QUEST: It seems almost perverse that having reported on that and having heard from Robert Reich and you look at the market, let's take a look at
the markets and you'll see exactly where it stands at the moment.
It's up more than one and a half percent. We're up run about one and a half percent today.
After the break, as investors are focused on states reopening we have a Nobel Prize winning economist that believes -- Paul Romer believes testing
-- test and isolate. Test and isolate. They all say that's a lot. That's next, after the break.
(COMMERCIAL BREAK)
[15:17:38]
QUEST: Welcome back. Now, despite the U.S. economy racking up huge numbers of job losses, the U.S. markets are racking up huge gains. Today is another
day.
It will be the third day this week if we close with a triple digit gain. Market is up over one and a half percent, comfortably over 24,000. The
NASDAQ has now regained -- it is now positive for the year. Yes, that happened yesterday.
So, now the NASDAQ is positive for the year so far, and it's over 9,000, just barely. You can see the numbers on the screen.
Investors are encouraged by U.S. economy that's reopening along with easing of tensions with China.
Trying to stem the economic damage, though, as the U.S. economy reopens is the work of much thought. In particular, the so-called test and isolate.
The way in which the economy can be reopened.
Professor Paul Romer, you see there joins me now. He is a Nobel Prize winning economist and believes that if you regularly test everyone in the
U.S. every two weeks, you isolate those who test positive, you limit the spread to five percent of the population or less, and the cost overall
could be $100 billion and there are a variety of ways in which you can do this.
Professor Romer joins me now. Paul, I read your report on what you suggest, test and isolate. Isn't this what the U.S. is supposed to be doing? Isn't
this the backbone of the plans that the White House put out with its guidelines and states are supposed to be doing?
PAUL ROMER, ECONOMICS PROFESSOR, NYU: Well, people are seeing the words, but they're not taking them seriously, because for this to work, you have
to test a lot of people. You have to test 23 million people a day to make sure you're testing everybody once every two weeks. And it has to be that
kind of frequency.
If you think about the reporting you were doing about people who are not going to the dentist right now, what's it going to take for me to go to the
dentist and for the dentist to want me to go to the dentist? It's going to take a negative test that the dentists can show me so I know I'm not going
to get infected when I go. And I'm going to have to have a negative test that I can show the dentist.
[15:20:04]
ROMER: And both of us have to have recent tests because as long as this virus is still spreading around us, you know, if I had a test six months
ago, it wouldn't give that dentist much confidence about looking into my mouth.
QUEST: I come back to the thought -- it's the way forward, but is it practical? Is it likely that the U.S. that can barely get to a million to
two million tests could ever hit 25 million tests?
ROMER: I'm very confident we'll get there. Unfortunately, that confidence comes from a grim prediction that it'll take months, and we're going to be
agonizing over this problem for the next, you know, several months, because the problem is that nobody has an alternative.
When they say well, okay, we're just going to open up, you think hard about where that path takes you, and it's horrific. And also, it takes a long
time, you're not going to rebuild confidence within at least a year along that path.
The other path is we stay in a depression long enough to something, and it's not clear what that something is. But you know, at some point, we're
going to let go of something, you know, we'll get the numbers down far enough, and then we can let go.
But then if you let go, you know, you're just back to the spread again. So, the people who are saying, where are we, you know, we're not going to test
our way out of this problem. They are not giving us credible alternatives.
Now, how much testing are you going to need? If there's a very clever, sophisticated effective tracing system, we might not need to test
everybody. But honestly, if I'm told that there's this very effective tracing system -- look, we were told we had this in January and it didn't
work.
And if they totally have that system, is that going to make me want to go to my dentist? I'm going to still want to see a negative test result. He's
going to want to see a negative test result, too.
QUEST: Isn't it highly likely, Paul that what will happen in the end is that there will be noise about testing and isolating. But in reality, what
will have happened is that Americans -- people will have accepted a higher level of deaths than might be as being the price for keeping the economy
more open.
ROMER: That's possible, but let me tell you why I don't think that's what's going to happen. We're going to want to make sure we don't overwhelm our
hospital systems. So, that means we're wanting to keep it down to something like 2,500 deaths a day from the coronavirus.
Now, if you just let this virus spread through the U.S. population, so it gets to say 60 percent of the population that has been infected, and they
either recover or they die, then using the current estimates of the infection fatality rate, that means about a million people die before you
get to this spread that's far enough that the virus starts to die out because it has trouble finding new people to infect.
If a million people are going to die, and you're going to limit the deaths to 2,500 a day, that means you've got 400 days of carnage like April,
before we get to the light at the end of the tunnel.
I don't think the economy is going to recover during those 400 days. I don't think people are going to be willing to wait that long to get back to
some semblance of normality.
QUEST: So, if we are where we are today, and realistically, it is difficult to get to the 25 million tests or even 10 million to 15 million tests.
We're looking at a summer of this continuing uncertainty where it's not going to be possible to make meaningful economic inroads of opening the
economy without this.
I see a Catch 22 here that makes -- and I'm hoping you can explain how do we get through the next two to three months when the testing and isolation
systems simply aren't there.
ROMER: Yes, so, look, everybody says to me, oh, Paul, we don't like your plan. We want something which fixes things this week. And, you know, look,
if you know somebody who has got a credible plan that fixes everything this week, go for it. But I have not seen anything that will work.
I think we can get to the millions of tests per day, and each million have additional capacity could save a lot of lives. The first million we get, we
could use to stop deaths in nursing homes. The next million we could use it to start opening schools.
So you know, each million helps us open and do things without increasing the spread of the virus. But if we put our minds to it, we could get to 23
million, but this economy can make 350 million cans worth of soda every day, distribute those, get them to the people who want them.
If we can do that, we can manage the process of making a tenth of that, 23 million tests a day.
[15:25:04]
QUEST: When I look at what you won your Nobel Prize for in the area of economics of innovation and the way in which the economy responds to
innovation and technology -- innovation -- that's the secret, really is it?
ROMER: That's right.
QUEST: It is the way we innovate that will allow the economy. I mean, you're the right economist for the moment, in a sense, because you've
studied this and won a Nobel Prize because of it.
ROMER: Yes, well, and you know, as I said, I'm confident we will get there, but the way we'll get there won't be just scaling up testing exactly the
way we're doing it.
But then just go back a few months, people were saying the only way you could do it is with these swabs, and we're out of swabs. What are we going
to do?
Well, innovators figured out how to do it where somebody just spits in a tube. It turns out, it's a better test than using those darn swabs that are
so uncomfortable.
So, there'll be a ton of innovation and we will get to much higher levels of testing. It's going to be very difficult and very painful to get there.
I'm sorry about that. But that's just the reality that we're going to have to work through.
QUEST: Paul, good to have you, sir. I do appreciate you taking time to talk to us. Have a good weekend, however we define a good weekend in these
difficult times, but I wish you well regardless. Thank you, sir.
ROMER: I'll try.
QUEST: California is taking steps towards slowly reopening and the debate that you just heard me having with Professor Romer is exactly the debate
that is now going on across the United States. How much? How quickly? How far? CNN's Dan Simon now reports.
(BEGIN VIDEOTAPE)
DAN SIMON, CNN CORRESPONDENT (voice over): Marcia Miller has owned this hair salon for 35 years. On Monday, she and her daughter reopened it.
Anxious clients filed in.
(BEGIN VIDEO CLIP)
MARCIA MILLER, OWNER, HEADLINES SALON AND SPA: I cried through the whole thing because I couldn't -- I was so happy that it turned around on me.
(END VIDEO CLIP)
SIMON (voice over): It has been an emotional whiplash because the very next day, California regulators said she needed to close back up and not doing
so could jeopardize her license. Still, Miller is staying open.
(BEGIN VIDEO CLIP)
MILLER: We haven't gotten a paycheck in six weeks. We haven't gotten an employment. What are we supposed to do?
KRISTI GOLBY, BUSINESS PARTNER, HEADLINES SALON AND SPA: Emotionally, it's been hard this last week. I mean, watching my mom -- this is her life, you
know, and I took it on as my life a handful of years ago. And so for us, it's emotional. It's emotional for our staff because now they feel
conflicted to support us, but they're scared.
(END VIDEO CLIP)
SIMON (voice over): What you're witnessing is a tug of war going on right now between rural California and Governor Newsom. Yuba and Sutter Counties
in Northern California have reported only 50 positive cases of the virus.
Its leaders decided it was safe for some businesses to reopen in defiance of Newsom's stay-at-home orders.
(BEGIN VIDEO CLIP)
GOV. GAVIN NEWSOM (D-CA): They put those businesses at risk, not only the health of their communities at risk.
(END VIDEO CLIP)
SIMON (voice over): Nonetheless, restaurants here now have dine-in customers. It's an image you won't see in other parts of the state.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: These little mom and pop businesses, they've got to open up in order to be able to survive.
(END VIDEO CLIP)
SIMON (voice over): Linda's Soda Bar and Grill in downtown Yuba City is a local institution.
(BEGIN VIDEO CLIP)
LINDA MCKENNA, OWNER, LINDA'S SODA BAR AND GRILL: The customers were ecstatic. Somebody even walked in and said, it's like Christmas morning. So
yes, they're thrilled that they can come back in and see their friends they haven't seen for a while.
(END VIDEO CLIP)
SIMON (voice over): But restaurants, too, are also putting themselves at risk in defiance of the Governor. At least those that serve alcohol, the
state ABC, Alcohol Beverage Control is informing restaurants, they could face disciplinary proceedings, which could include losing their liquor
license by remaining open.
(BEGIN VIDEO CLIP)
HENRY STUEVE, OWNER, KRANKIN HANKS SPORTS BAR AND GRILL: I consider the red coats who showed up yesterday and shut me down.
(END VIDEO CLIP)
SIMON (voice over): For Henry Stueve, staying open was a risk he couldn't take.
(BEGIN VIDEO CLIP)
STUEVE: It's crippling to our business if we lose our license. We wouldn't have a sports bar. It's kind of, you know, you won't have one.
SIMON (on camera): So you said, I need to shut down.
STUEVE: So, we shut down.
(END VIDEO CLIP)
SIMON (on camera): Well, state regulators say they are sympathetic to the plight of these businesses, but clearly this is a warning and these places
need to decide if you're going to remain open.
Dan Simon, CNN, Yuba City, California.
(END VIDEOTAPE)
QUEST: Today is VE Day, Victory in Europe Day. And after the break, we'll be talking to her historian who makes the comparisons between then and now
because so many people are saying, this is our own 21st Century war. In a moment.
(COMMERCIAL BREAK)
[15:32:28]
QUEST: Hello, I'm Richard Quest. We have of course more QUEST MEANS BUSINESS in just a moment. Today is V.E. Day as we commemorate the ending
of one world crisis. We face of course, the latest and returns either any comparisons or what we can make of all of that.
And also, Arianna Huffington is with me, and besides the physical crisis and medical crisis, as a mental health crisis too. It needs to be
considered in all its extremes. We're going to talk about that with Arianna in a moment. This is CNN. And on this network the news always comes first.
Today is the 75th anniversary of the Allied victory in Europe. V.E. Day. Celebrations of course different this year, social distancing precluded
parades. (INAUDIBLE) of course, events mark indication all over the world. The U.S. economy has lost a staggering 20-1/2 half million jobs in April.
It's the biggest monthly loss ever recorded. The unemployment rate is 14.7 percent. The White House economic adviser says it could get worse,
predicting the number could rise to 25 percent next month.
The White House has not confirmed the second staff member has tested positive for the virus. It's someone who works for the Vice President Mike
Pence. Earlier, Mike Pence's flight to Ohio was delayed by an hour. People in contact with this person were taken off the plane. This week a valley to
President Trump tested positive.
Two white suspects, a former police officer and his son to face murder charges in the State of Georgia. The victim was an unarmed black jogger,
Ahmaud Arbery who was killed in February and video of his death surface this week, and that sparked new outrages and led to the arrest.
2020 K League football kicked off quietly in South Korea. Coronavirus has delayed season by some two months. Hyundai Motors and Samsung Bluewings
played. It was in an empty stadium. As you can see, now everybody's hungry for sporting to continue. 10 countries bought rights to these games and
there will be streamed on Twitter and YouTube.
One thing is clear. The levels of unemployment that we have seen announced today 14.7 percent certainly greater than the financial recession of the 19
of the -- of the early part of the decade.
[15:35:06]
QUEST: But even really, you've got to go back to the Second World War before you see these sorts of numbers and beyond. Becomes 75 years to the
day since V.E. Day. There you see Winston Churchill, announcing the end of the war. And that of course, I should enter post war boom, wealth and
shared prosperity. That's like a which had never been seen before the 1950s. Pomp and pageantry. Now that's not possible today.
The streets are empty, compare London then, compare London now. The virus is causing an economic catastrophe. Then the liberal international economic
order resulted in a golden age, the rise of the middle class, you had the Marshall Plan in the U.S. for Europe, the G.I. Bill, the Post War
Consensus, the Washington Consensus even. Now, second economic crisis in 12 years. Job losses hitting young minorities, millennials, likely poorer than
their parents.
This is the first generation that will do worse. And that was always said before, most certainly now. Rampant inequality, high debt. And the
government response is doubtful the best. Adam Tooze is with me, professor of history at Colombia University. I'm always very wary, Adam, of drawing
what might be regarded as false parallels between a major crisis like the Second World War.
And to now but to the extent that we came out of the Second World War with a -- with a unanimity of purpose, I wonder if that unanimity of purpose
exists today.
ADAM TOOZE, PROFESSOR OF HISTORY, COLOMBIA UNIVERSITY: I think you're right, Richard, to be skeptical about those kinds of analogies. The
unanimity of purpose that came out of World War II had to do with very fundamental aspects of political and social organization at the time, a
very powerful, organized labor movement in both Britain and the United States for instance, trade unions, key players in the war effort at the
time.
The representation of the Labour Party within the wartime government, FDR's new dealing administration in the United States. That was the substance
behind that sense of social solidarity. That was the political muscle behind the creation of the welfare state. We're in a very different regime
right now. And so though, I think you're absolutely right to highlight the damage that's been done to the weakest and the most precarious on both
sides of the Atlantic in the labor market.
I don't draw from that the inference that they're necessarily going to as it were, inherit the earth and be in a position to shape a new welfare
state coming out the other side of this, that depends on certain preconditions, they aren't there anymore.
QUEST: Right. The talk about leadership though, if you look at the leadership, you know, I was reading your article about remembering Second
World War. What came out of it? Yes, the United Nations came out of it. Yes. And you had the Bretton Woods institutions, you had the Marshall Plan.
Do you see -- I don't see a G20 that cannot -- can't even agree on a way forward. I don't see any form of coordinated response that would ensure a
better survival for those at the bottom and those most affected.
TOOZE: No, I agree. I mean, we sugarcoat our memory of 1945 which protects us from the sheer violence that was necessary to finish that war, and the
death -- life and death struggle that Nazi Germany faced forced on its opponents right down to the very end. And we forget that the essential
precondition for all of those programs. Bretton Woods in particular, was absolute American hegemony and leadership on the western side.
And then after 1945, the increasing antagonism between the Western powers and the Soviet Union. In other words, you don't have the Marshall Plan
without McCarthyism, you don't have that kind of level of cohesion in western leadership and indeed promises and commitments to redistribute,
which are more than just trickle down without the threat of communism in the aftermath of 1945.
So those preconditions, those pressures, you know, the sheer ugliness, violence and conflict that were hallmarks really, of the world after 1945
are not there. And what we have instead is this multipolar order, which I think, you know, with any luck is not going to issue into a great power
conflict, but nevertheless is not capable of yielding the kind of cohesive action we need.
QUEST: But that's -- unfortunately, by all 40, depending on your view, all roads do lead to Donald Trump at some point in this in that -- the -- there
was -- there was not seeming, there was a deep trade tension with China which exists and may flare up again.
[15:40:06]
QUEST: The relationship with Russia is ambiguous with more sanctions, but obviously, mutual admiration. Do we -- and of course the relationship with
Europe is fractured. Do we require? Maybe we don't, Adam, maybe we do. But do we require, in your view to have some form of cohesion between leaders
to fully recover from this or can Donald Trump's previous policies just continue?
TOOZE: I mean, if they do, I think it's a recipe for disaster because there's going to be really a perfect storm of factors pushing back against
the recovery of global trade. There's going to be the interruption of supply chains. There's going to be huge shocks. We've already seen it to
emerging market exchange rates. It's only a matter of time I think between that before the White House starts calling Brazil on the much lower value
of exchange rate and start arguing about soybean exports to China.
There is profound politicization of the virus itself. And there are macroeconomic shocks, which means that the demand base for global trade is
just not there anymore. We actually need a fundamental change and rethink on the part of Washington because if they go back to the game being played
in 2019, and continue to pick fights the way they were then it's a very bleak outlook indeed, I think.
Not just for the United States but even more for the large emerging markets, which depend on the dynamism of that global trade.
QUEST: Professor, you're just a couple of miles up the road from me where we are now but after this is all over, we are able to get together in the
studio, please do come along. And let's have a chat face to face. I'd love to have you back with us again.
(CROSSTALK)
TOOZE: It will be a pleasure. Stay well.
(CROSSTALK)
QUEST: Appreciate it. And have a good weekend if you -- whatever as I say, whatever that we decided. After the break, the mental health issue of
course is exceptionally serious. And we have only just begun to understand the ramifications of this. Arianna Huffington is with me after the break.
(COMMERCIAL BREAK)
QUEST: May is Mental Health Month in the United States and it's a worldwide pandemic. Well, one of the -- perhaps unspoken and certainly most worrying
aspects of all of this is the toll that is taking on mental health. Lockdowns adding to sense of stress, isolation and certainty. Even if
you're handling a lockdown just the knowledge that your way of life is not the same, may not be the same in the future is of course in itself a
tremendous pressure.
[15:45:11]
QUEST: Thrive global is working with Stanford Medicine on ways to manage the coronavirus anxiety. The founder and chief executive is Arianna
Huffington, joins me -- Arianna with me from Los Angeles via Skype. And Arianna, it is so good to see you today. Thank you for making time. And so
where we begin? Where do we begin to fully understand the ramifications for mental health of this pandemic? I can't even grasp it.
ARIANNA HUFFINGTON, FOUNDER AND CEO, THRIVE GLOBAL (via Skype): Well, Richard, we need to begin with the fact that even before the pandemic, we
were dealing with a global mental health crisis, that in fact depression was the number one cause of disability globally, and therefore we are
already entering the pandemic very vulnerable in that area. And as you mentioned in your introduction, all these social isolation, uncertainty,
anxiety about the future, have simply led to two-thirds of people around the world.
Saying that they're experiencing more mental health problems having a hard time sleeping or reverting to addictive behaviors, and like stress eating
or over drinking. So, the good news is that companies, a lot of the companies we're working with like Accenture, Salesforce, Verizon, Ernst and
Young are actually acting as conveners of community and solutions and we are working with them with this problem that you mention so we developed.
QUEST: This idea of corporations working with you that same time is a -- is a -- is somewhat you -- a recognition, isn't it? The firstly, there will be
a huge problem, a pressure cooker problem that's waiting to come out. Secondly, whether it's medication or psychiatric treatment or some form of
counseling or therapy, this is going to have to be addressed.
HUFFINGTON: Absolutely. But what we are finding is that a lot of what needs to be done is behavioral. We are not dealing with the more extreme cases
that require medical interventions, but only behavioral fraud. There is an enormous amount that companies can be doing and are doing and we're seeing
incredible engagement. And we break it down, Richard, to micro steps, tiny, daily incremental changes in behavior that begin to add to healthier habits
that affect our mental health that affect depression and anxiety.
Just to give you a couple of examples, one is the fact that it takes 60 seconds to course correct from stress. Stress is unavoidable, especially
during a time like this. But the problem that leads to mental health problems is cumulative stress. So if you take 60 seconds at different times
during the day to focus on your breath, for example, our breath is our superpower. Or to remember three things you are grateful for.
Small but scientifically based interventions that change the stress neural pathways of the brain. So that's why we are often in companies and a lot of
companies are stepping up to the challenge.
QUEST: So, this idea we're just showing on the screen, this idea of taking time. Use your breathing, set news and social media cutoff times, I firmly
believe, an hour in the morning and an hour in the evening for the news and hopefully you make it. QUEST MEANS BUSINESS your hour in the evening. Look,
but finally, what about this idea that some would say, yes, I get all of this, Arianna, but come on, you know, pull yourself up by your bootstraps.
It's a sign of weakness, if you're not able to cope with these difficult times. I know that's not the case. But there will be people who will say,
you -- we should be able to cope with this.
HUFFINGTON: Well, I mean, after all, Richard, everything we've just talked about, it's about us feeling more empowered and actually taking steps in
our own lives. That doesn't mean we don't need structural changes. That doesn't mean we don't need governments to step up those -- and help those
who have lost their jobs are basically doing essential jobs but being paid minimum wage.
[15:50:06]
HUFFINGTON: All those things are huge changes that need to happen at the collective level. But in the meantime, we need to act on those things that
do have the power to act. And that's where micro steps come in. And that's where companies come in, you know, we've been talking for years about
stakeholder, capitalism, and inclusive capitalism or this is the time for companies to actually practice it, and not just preach it.
And in fact, we are seeing that the companies that do and put the health and wellness of their employees at the front are doing better and are going
to be doing better in a sustainable way.
QUEST: Arianna, thank you. Once again, talk about stakeholder capitalism. You and I will talk more about that in the future. As I've said to
everybody say, have a good weekend, however, you choose and are able to do that. Love you to talk to you tonight. Arianna, thank you so much.
HUFFINGTON: Thank you.
QUEST: As we continue in a moment, just after the break. In the U.S., it's Mother's Day. But roses and flowers, well, they will be feeling poverty
perhaps, perhaps. We'll talk about how Colombia is not sending flowers.
(COMMERCIAL BREAK)
QUEST: A different voice of the crisis tonight. It's Mother's Day in many countries around the world. In the Colombia, flower growing industry of
course, though, it is far from a happy occasion. Stefano Pozzebon now reports from Bogota.
(BEGIN VIDEOTAPE)
STEFANO POZZEBON, CNN CORRESPONDENT: The flowers are in full blossom in the orchards of Colombia. But business is far from blooming. In the last three
months the country has been badly hit by coronavirus. Colombia is the second largest flower exporter in the world, an industry that generates
$1.5 billion every year and creates about 140,000 jobs according to the local association of flower growers.
Flores Las Acacias, a company in the outskirts of Bogota flies 95 percent of its products to the United States. But how's the orders for the past
month have been canceled? To make things worse, the virus heat right when the industry was gearing up for one of its busiest days,
Mother's Day.
NATALIA PASTRAN, FLORIST, FLORES LAS ACACIAS (through translator): Mother's Day is essential for us, together with Valentine's Day. Valentine was good
but having to lose Mother's Day will affect us for the rest of the year.
[15:55:09]
POZZEBON: This company takes the virus very seriously. Workers and visitors alike have to go with thorough a thorough security protocol, including
temperature checks and the clinical questionnaire before entering the greenhouses. Inside, production never stopped to keep the plants healthy,
even though it meant many flowers had to end up in the bin. To accommodate losses, Las Acacias reduced working hours and spread it staff in several
terms.
About one every 10 workers have been kept isolated at home because they're from at risk categories, such as over 50 or pregnant. The flower industry
is such an important sector for the Colombian economy that in February, President Ivan Duque himself went on state television to announce the
launch of a big investment plan that will see Colombian flower exports doubled in the next 10 years.
Of course, all of those ambition had to be put aside as most of these productions in the last five weeks or so, didn't go anywhere. Business is
only now picking up again with a partial reopening of flower shops in Europe. But the concern in the long term remains strong. Flowers are almost
entirely exported by plane, which means that as long as air traffic will return to normal orders will still be canceled.
AUGUST SOLANO, PRESIDENT, ASOCOLFLORES: We need -- we produce flowers every day, so we need to sell them. So we want to see how the markets will open,
especially the United States.
POZZEBON: But not all the flowers are going to waste. These bouquets have been donated to workers who are delivering aid to quarantine areas in town.
A little gesture for those on the front line against coronavirus. Stefano Pozzebon, CNN, Bogota.
(END VIDEOTAPE)
QUEST: We'll have a profitable moment after the break.
(COMMERCIAL BREAK)
QUEST: Tonight's profitable moment. I refuse to leave you tonight on a downbeat note of the pandemic, the high levels of unemployment, the jobless
numbers in the United States. Instead let's focus perhaps on the little slither of silver lining in a very dark cloud. 17 million of those who are
unemployed in May, they said that the unemployment was temporary until the economy gets going again.
And the stock market tonight, even though it seems weird and perhaps perverse, is also telling us with a gain of over 1-1/2, that somehow they
believe the economy will be moving again, sooner rather than later. Put this together, along with the fact that in the U.K., there'll be an easing
of restrictions. And that's already happened in Germany and in France and in Italy. I think tonight, at least we can go off for a weekend of Mother's
Day in some places, beautiful weather in Europe, perhaps good weather where you are.
At least we can say, well, let's have a weekend. And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York, whatever you're up to
this weekend, I hope it's safe and profitable.
[16:00:04]
QUEST: The closing bell is being run on Wall Street. The Dow is up.
END
