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Quest Means Business
UK's Liz Truss Sets Ambitious Agenda As Prime Minister; UN Investigators Discuss Zaporizhzhia Nuclear Facility; EU Looks At Various Price Caps On Russian Natural Gas; E.U. Looks At Price Caps As Natural Gas Costs Skyrocket; Liz Truss Becomes New British Prime Minister, Unveils Cabinet Picks; Dash To The Bell. Aired 3-4p ET
Aired September 06, 2022 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ISA SOARES, CNN INTERNATIONAL HOST: The losses continue on Wall Street as investors return from Labor Day holiday.
The Dow down some 200 points after opening in the green. Those are the markets and these are the main events.
And it is official, Liz Truss becomes Britain's Prime Minister after meeting with the Queen.
We can ride out the storm, Truss arrives at Downing Street with a plan to fix Britain's energy crisis. It could cost more than $100 billion.
And the UN's nuclear watchdog says the fighting at a nuclear facility in Ukraine must stop before it leads to disaster.
Live from outside the Houses of Parliament in London. It is Tuesday, September 6th, I am Isa Soares, in for Richard Quest and I too, mean
Good evening, everyone. It is 8:00 PM here in London and what a day it has been. The UK's new Prime Minister is here and she says she is ready to
tackle the country's biggest problems.
Today, Liz Truss, as we've seen throughout the day, flew to Scotland to meet with the Queen who formally offered her that top job of Prime
Minister. From there, the new Prime Minister went to 10 Downing Street, where she addressed the country, really setting out an ambitious agenda.
She promised to fix the economy as well as its health system, among other things and committed to immediate action on the energy crisis. Have a
(BEGIN VIDEO CLIP)
LIZ TRUSS, BRITISH PRIME MINISTER: I will deal hands-on with the energy crisis caused by Putin's war. I will take action this week to deal with
energy bills and to secure our future energy supply.
We shouldn't be daunted by the challenges we face. As strong as the storm may be, I know that the British people are stronger.
(END VIDEO CLIP)
SOARES: Pretty aspirational speech. Well, early reporting has shed light onto what could be included in that action on energy that we're expecting
some point this week.
The Truss plan could include -- could include stopping households' energy bills from rising, reimbursing energy suppliers who face losses because of
course they've been prevented from putting up prices and financial support as well for cash strapped businesses.
Unconfirmed report, so the plan could cost nearly well, $200 billion over the next 18 months.
Anna Stewart is in London keeping an eye on all of this and Anna, in the last hour or so, we've seen that Kwasi Kwarteng is now the chancellor. He
is now Chancellor of the Exchequer, and now of course he's got -- this is one of the biggest job he has at hand. So, what can we expect from him
ANNA STEWART, CNN REPORTER: Yes, what do we know about Kwasi Kwarteng? Well, once upon a time, Isa, he too, was actually a journalist. He was a
columnist for "The Daily Telegraph." And it was interesting, delving through some archives, in 1987, when William Hague was leader, he wrote,
"Reform is the buzzword of the moment, even the Conservative Party is flirting with the idea." He then a decade later entered Parliament. And of
course, now he is charged with reforming the UK economy.
He has a lot of experience. He is just leaving the post of Business Climate Energy Secretary, so he has been heading up that role and actually, he has
been leading the way in terms of reforming the UK's electricity market already, which involves trying to disconnect gas prices from electricity
prices, which will take some time, but he is certainly well-versed in all things energy and climate. He takes the top job.
Now, I've received a message just in the last couple of hours from another Conservative MP who actually backed Rishi Sunak's campaign. He will of
course not be in this Cabinet, but it was interesting he was complaining about Conservative Party tribalism.
And I think we will see some of that potentially in this Cabinet as it starts to get formed. For instance, the expectation for Kwasi Kwarteng's
replacement as Business Secretary is Jacob Rees-Mogg and I'm sure we've got some good pictures of him here. He is a Boris Johnson loyalist. He is a
Brexiteer. He is a more on the right of the party, I would say and also like Liz Truss, yes, her we go.
This is him lounging out in Parliament in 2019. You may remember this during one of the many debates about Brexit, Isa, and he came under a lot
of fire with the opposition MPs calling him arrogant and disrespectful. He did say that it was perhaps a mistake later.
He has also controversially talked and warned about climate alarmism, but the good news and terms for business is he is pro-business.
He wants to reduce red tape. He also wants to reduce taxes. And of course, that's exactly what we have heard again and again and again through the
campaign from Liz Truss.
So, we await to see if that role is built.
SOARES: Yes, and of course, we are waiting to see what that package will look like on Thursday. We did hear though, Anna, a pretty aspirational
speech from the new Prime Minister saying the UK can ride out the storm, and that she will deliver on the economy and on energy and on the NHS, the
list was endless.
What of the markets? And what are investors making of this? How confident are they that she can deliver on all of this?
STEWART: Well, I think we all need, including investors see a lot more detail because she does speak about an aspiration nation, her two of three
priorities were growing the economy and tackling energy bills. We lack all the detail.
We know that she wants to reduce taxes. We know that she probably wants to freeze energy bills for households. But how is she going to fund it?
I think looking at what investors think at the moment; today, we saw the sharpest selloff for UK government bonds. This is for the 10-year since the
beginning of the pandemic back in March 2020, so that may say something about what investors are expecting. Clearly, they expect the government to
issue more debt.
And Isa, in terms of the British pound, we were speaking about this yesterday. We hit a low yesterday not seen since 1985. It's back from that
low, but it's still under pressure today. You'll see it sort of hovering around the $1.15 mark.
So in terms of that, I'd say investors definitely needs some more detail at this stage, but I think there are concerns about how this government wants
to fund all of these plans -- Isa.
SOARES: Indeed, Anna Stewart for us in London this hour. Thanks very much, Anna.
Well growing the UK economy, of course, as Anna was saying will be one of the biggest tests for this new administration.
Earlier, I spoke to Gerard Lyons, an economist and economic adviser to Liz Truss, and he told me about the steps he expects will restore near-term
confidence. Have a listen.
(BEGIN VIDEO CLIP)
GERARD LYONS, CHIEF ECONOMIC STRATEGIST, NETWEALTH: In terms of the market is, it's three different aspects here. One, it's the energy price cap on
Thursday; tomorrow is likely to be a focus on making sure that people understand the Bank of England is independent, and the Bank of England is
going to get on top of inflation.
And third, in two weeks' time or maybe next week, it's the so-called fiscal event. People might have to wait a while for that, but is only one week,
maybe two weeks, and the fiscal event is very much about the fact that the UK was the only G-7 country that was tightening policy, raising taxes into
a global downturn.
So, by reversing those planned tax increases, and by actually cutting taxes further, we should rule out a deep recession, maybe prevent a recession
(END VIDEO CLIP)
SOARES: Now, Yael Selfin is the UK chief economist of KPMG, and she joins me now. There is plenty for us to discuss. What did you make first of what
you heard from the Prime Minister -- new Prime Minister, Yael?
YAEL SELFIN, UK CHIEF ECONOMIST, KPMG: So, there were three priorities, but they cover quite a big range of things that she wants to do, and
potentially will mean quite a lot of money that we'll be spending the next year or so, so that it is a very large agenda.
It's not just focusing on energy, and the rising energy prices. It's also focusing on some of the longer term issues that we have.
SOARES: Yes, it does seem sound to me like this Prime Minister, perhaps will be spend, spend, spend, I mean, even perhaps spending on Defense. How
do you think that she will be able to prioritize all this -- oh, but first of all, how will she get the money for all of this?
SELFIN: Well, there is always money that well, not always, but there is still money that she can borrow, the only thing is that we will need to pay
back at some point.
So, there is the issue about whether you want to focus a little bit more so spend on the things that you really need to rather than spend more broadly.
So, we will need to see how, for example, the support for the high energy costs is going to be planned.
We could see overall help for the whole population or we could see more targeted support. If it is the former, that means quite a lot of money,
potentially more than 100 billion pounds.
SOARES: And potentially for two years, the next two years or so, and that's staggering if we go -- if we are looking at a two-year plan.
SELFIN: Yes. Absolutely. That is quite a lot of money. If we make it more targeted, we would potentially save more than 30 billion a year. So, we'll
need to see the details for that.
But apart from that, she also mentioned quite a lot of other things like infrastructure, spending on schools, as well as the NHS. We need to see the
details of that in coming days or potentially weeks.
SOARES: And on the energy front, one thing that struck me in this conversation we were having at home with my husband is, the minute you
start. Let's not call it a handout, but the minute you are starting to put these packages in place to help the crippling costs, you take away the
incentive from people having to learn how to actually minimize the costs at home. And I think this is something that is perhaps the criticism that she
may face going forward.
The other point, I think you touched on there is, you know, what impact does that have on borrowing on debt. Our GDP is what -- 90 percent? You
probably -- you can tell me better, what's our debt to GDP ratio?
SELFIN: Yes, well it is just over that, it all depends on the forecast that you have for inflation interest rates going forward, but we are now
expecting debt to go above the 100 percent of GDP.
Obviously, we have two problems here. At the same time, on the one hand, GDP is shrinking, because we are expecting a recession. And then on the
other hand, we are expecting also costs to rise, so there are further pressures on public spending. It doesn't mean that she can't do things in
the short term, but the key is to sync with the trade also, because ultimately, it will need to be paid and it does mean that ultimately there
will be less money at some point to spend on other things.
SOARES: When you look at her basic plan, and as she calls it, a bold plan. I'm saying basic, simply because we don't have the details here. When we
will look at what we've heard so far, what troubles you, Yael?
SELFIN: Some of the things that trouble me is that we could potentially spend a lot of money on things that will not actually deliver that much.
SOARES: As such, give me an example.
SELFIN: For example, energy; helping with energy prices, it would be much better in a way to support those who are most vulnerable with a more
targeted package than give the handouts to all household. Some of them may not need it as much as other and then save that money to spend it on other
things that are needed, for example, we do need to help overall growth rise in the UK economy.
SOARES: Yes, I'm sorry to interrupt. I want to take you live now to the United Nations Security Council meeting. Its members are meeting and
discussing the critical situation at the Zaporizhzhia Nuclear Power Plant. Let's have a listen.
RAFAEL GROSSI, DIRECTOR GENERAL, INTERNATIONAL ATOMIC ENERGY AGENCY: . to the cause of the United Nations. Thank you very much, Secretary-General, we
will continue, I hope working together to bring stability to the nuclear facilities in Ukraine.
So today, you may have seen that I issued a comprehensive report emanating from the mission I had the honor to lead last week in Ukraine and the visit
to the Zaporizhzhia Nuclear Power Plant.
This mission has been the result of a painstaking effort of close to six months, during which strenuous efforts were deployed to try to do just
that, to be there with our inspectors to address a complete, comprehensive report of the situation to corroborate some facts that we have been
observing for the last six months, but not stop there.
And to also provide very, very concrete recommendations based upon what we saw at the plant.
The first important safety pillar that exists in any nuclear facility is not to violate its physical integrity. And unfortunately, and as I had the
opportunity to say, also, during the briefing that took place on August 11th under the Chinese presidency, this has happened. This happened and
this continues to happen.
The physical attack wittingly or unwittingly, the hits that this facility has received and that I could personally see and assess together with my
experts is simply unacceptable. We are playing with fire, and something very, very catastrophic could take place.
This is why in our report, we are proposing the establishing -- the establishment, sorry, of a Nuclear Safety and Security Protection Zone
limited to the perimeter and the plant itself. I am going to return to this point later on.
The second pillar that is important states that all safety and security systems and equipment should operate normally, unhindered, and be fully
functional. We know and we observed that the operators at the plant were operating under extremely challenging circumstances, and together with
military equipment and vehicles in different parts of it.
Our concrete recommendation in this regard is that the military vehicles and equipment that are currently present in buildings inside nuclear
buildings on the site be removed so as not to interfere with normal operation of the nuclear safety and security system.
The third pillar states that the operating staff must be able to perform their duties without undue pressures or difficult circumstances. And of
course, this is something that, as you know, has been addressed time and again, during this crisis, and especially since the nuclear power plant was
occupied last March.
So, we could see, we could work together alongside the experts and we come, of course, to the conclusion, which is in the recommendation, a specific
recommendation in my report that the operator should be allowed to return to its clear and routine line of responsibilities and authorities at that
appropriate work environment must be reestablished, including with proper family support for the staff.
Pillar number four is the one that refers to the off-site power supply. I also refer to this in the past and as you know, this is crucially important
in the sense that a nuclear power plant without external power supply may lose crucial functionalities including the cooling of the reactors and the
spent fuel. Without this, we could have a very serious nuclear accident.
So, regarding this pillar, the IAEA recommends that the off-site power supply line redundancy be reestablished and available at any time. For this
to be possible, all military activities that may affect the power supply systems must be stopped immediately.
The fifth pillar states that there must be uninterrupted logistical supply chains and transportation to and from the site. You have to imagine that
this nuclear power plant as Secretary-General has rightly reminded as the biggest in Europe is a large industrial site requiring a constant flow of
spare parts and other equipment. The situation that is, of course, abnormally interrupted now in face of this conflict.
Our concrete recommendation in this regard is that all the parties, all the parties should commit and contribute to ensuring effective supply chains.
And in this regard, we would like to remind that through the IAEA Assistance and Support Programs that we applied, for example, in Chernobyl,
a flow of supplies has been significantly reestablished and a similar mechanism could be applied in Zaporizhzhia.
The sixth pillar is the one that refers to the functioning of the Radiation Monitoring Systems to know what is the situation and whether there is
radiation in the atmosphere. We do have sets of networks of monitoring equipment that have been affected.
The concrete sixth recommendation in our report indicates that the site should continue ensuring this functionality, including by drills and
exercises, where which the IAEA can help ensuring.
And the seventh and final pillar states that there must be continued and reliable communications with the regulator -- with the Ukrainian regulator
and with others.
We have seen repeatedly that these lines of communication have been interrupted. So the IAEA recommends in its seventh recommendation
corresponding to each one of the seven pillars of the safety and security that reliable and redundant communication means and channels be secure at
Dear colleagues and Mr. President, the mission that took place last week, a historic one indeed has provided us and the international community with a
precious instrument in the presence of an IAEA assessment and monitoring mission that could provide us all today with a comprehensive report that
provides a neutral, impartial, and technical reading of the situation.
But moreover, which is also of enormous value is the fact that inspectors of the IAEA have remained at the site. So at the moment, the IAEA, and
through it, the United Nations and the international community have the capacity to have direct immediate evaluation of the situation on the
ground, as may be the case as it may happen.
And this fact is unprecedented.
In the past, ladies and gentlemen, when IAEA inspectors were in places which had underwent difficult -- undergoing difficult circumstances like
Chernobyl or Fukushima, or even armed conflict, like in Iraq, it has always been after the fact, it has always been to pick up the pieces, to remediate
what had already happened.
We, in this case, had the historical, ethical imperative to prevent something from happening. And by having established this presence, and by
agreeing to our Special Safety and Security Protection Zone, we will be able -- we have the opportunity to prevent this from happening.
As it is stated in the report, we are ready to consult quickly with the parties. We believe that this measure, which can be considered an interim
measure, in the hope that other more comprehensive measures of a more effective nature in the context of the conflict, which is not in the remit
of the IAEA naturally, can be agreed, but this is something that can be done now.
We have the inspectors there already deployed, they are doing their work. We can agree on a very simple, but incredibly necessary protective
mechanism to avoid what is happening now as we speak, which is the shelling of a nuclear power plant.
Let's seize these opportunities, so fundamental for peace, for security and to protect the populations of Ukraine and beyond.
I thank you very much, Mr. President.
SOARES: You have been listening to the IAEA, Rafael Grossi, who is basically giving us his report on what him and his team have found, of
course, having visited Zaporizhzhia Nuclear Power Plant. If remember, Grossi was there last week. Several members of his team remain from what I
believe still in Zaporizhzhia, inside that nuclear power plant.
He said that the physical integrity of the plant has been violated. He also said the seven pillars, he said, have been violated. And he said he is
gravely concerned about the situation, talked about this being unprecedented, this situation, said that establishing a Nuclear Safety and
Protection Zone around the site, that is of the most importance.
He talked about also, this is something that came out of the report that military vehicles and equipment that there were Russian military vehicles
and equipment inside the Zaporizhzhia Nuclear Power Plant and what he is saying, what he is calling for, what he is recommending is that the
military vehicles and equipment must be removed from the building.
Let's get more from Sam Kiley who is in Odessa and was listening in.
And Sam, my first question to you really, I heard him talk about this idea of a security zone, a Nuclear Safety and Protection Zone. Is this the same
as it a demilitarized zone or what's the distinction here?
SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: It could be a bit of UN speak for a demilitarized zone. It will, I think have to -- that will kind
of come out in the diplomatic watch over the future negotiations.
He did say specifically relating only to the plant rather than to the dormitory town that supplies the labor for the plant, arguably and
certainly the Ukrainians would argue, there is no point in demilitarizing the plant if you can't demilitarize the people who work there.
And also, it is not clear whether it is an actual removal of the Russians entirely from the plant, from completely demilitarizing it when he was
discussing that the command and control if you like of the nuclear processes of the power plant itself should revert entirely to the
That would strongly imply that the Russians, civilians even have to remove themselves from that process.
If you add to that, Isa that the report itself says that 40 percent of the -- only 40 percent of the people working on the physical integrity of the
plant is still there, that the fire service there, the firefighters are down from 150 to around 80 and have had to move their fire station out of
the plant because of war damage.
He is painting a very worrying picture, indeed. This is not a picture that has come as a surprise to anybody, but now, we've had independent eyes from
the United Nations in there. As he points out, there are two United Nations monitors on the ground, on a warzone, on the frontline.
We know that it's a firebase being used by the Russians. He was very careful not to point fingers about to whom might be doing the shelling,
which has affected not only the buildings within the plant, but those important power supplies, which ultimately are part of the cooling system
for the nuclear reactors coming into the plant.
We know that they've been cut or suspended at least three times in about the last 10 days -- Isa.
SOARES: A very troubling picture. I know he said earlier -- Grossi said earlier to our Christiane Amanpour that, you know, we are playing with
fire. Let's stop wasting time.
Sam Kiley for us in Odessa with all of the latest there. Appreciate it, Sam.
And we are getting more details this hour on Europe's plans to cap the price of Russian gas. "The Financial Times" says two options are being
considered right now.
The first is an EU-wide cap. The second would allow for different price limits based basically on the country's energy mix.
Brussels is trying to kind of soften the blow of those soaring and crippling energy prices following, of course, Russia's invasion of Ukraine.
Europe's benchmark gas prices, that's gone up about 300 -- eyewatering -- 340 percent just in the past year, as you can see there from your graph.
Prices surged 35 percent on Monday. The first trading day, of course, after Gazprom said would not restart the Nord Stream pipeline and they announced
that, it happened on Monday, and then they said they weren't getting restarted.
Helima Croft is the Global Head of Commodity Strategy at the RBC Capital Markets. She joins me now from Rhode Island.
Helima, great to have you on the show. What do you make first of all of the EU's plan to kind of cap the natural -- the price of natural gas from
Russia, do you think it will ease pressure on consumers here?
HELIMA CROFT, GLOBAL HEAD OF COMMODITY STRATEGY, RBC CAPITAL MARKETS: I mean, the key thing is that we don't have a lot of Russian natural gas
going into Europe at the moment. And the question is, are we going to see further reductions beyond Nord Stream 1? Will they potentially, you know,
close down flows through Ukraine? Will they potentially take offline TurkStream?
And so I do think that the question about capping Russian gas into Europe will depend really on efficacy, how much Russian gas will be going into
Europe going forward? And then that's the broader question is, you know, again, how much additional supplies can Europe get if we have a colder than
Right now, Europe has done well in building up storage, countries like Germany have proceeded very quickly with building out an LNG regasification
infrastructure, but we don't have a lot of additional supplies to make up for Russian gas if it is a full cut off scenario.
SOARES: Yes, and like you said, Helima, I mean, Germany, Europe's biggest economy has done particularly well in trying, of course, to boost its stock
in terms of gas.
But, you know, as we were saying, Gazprom, of course, shutting off Nord Stream 1 pipeline happened on Friday. How much -- explain to our viewers,
Helima, how much impact if at all, that has on Europe's ability to prepare, like you said for winter, if it's going to be a blistering one?
CROFT: I mean, this was pretty well telegraphed. I mean, you had Fatih Birol from the IEA months ago, warning that Europe should prepare for a
complete Russian gas cutoff.
I mean, gas has been the political weapon of the Russians in terms of how they play geopolitics. If you look at Russian revenue, they are far more
dependent on oil revenue than gas revenue.
So, I do think that part of the reason why you had the Germans move so quickly to build out its LNG infrastructure, remember, before the crisis,
gas was not even in the European taxonomy. The fact that you've had Germany move this quickly in terms of LNG infrastructure build out speak to, I
think, they saw the threat that was coming from Russia.
SOARES: Yes, trying to disrupt, of course, you're trying to disrupt the dependency that we've had for so long on Russian gas.
As you've known, Helima, here in the UK, the new Prime Minister, Liz Truss has spent much of her kind of inaugural speech outside 10 Downing Street
really addressing kind of the energy crisis, the energy crunch, telling Brits kind of that we are going to weather the storm.
She's got a lot of work ahead for her.
How bad do you think it will get for Britain?
CROFT: The question is going to be, how much is it going to have to cost government in terms of subsidies to shield consumers from the impact of
rising energy prices.
A lot is going to depend on what happens if it is a colder than expected winter. I was just in Norway for the ONS (ph) conference and number of
European leaders just kept coming out and saying, we've got this if we stick together.
They pointed to the storage level, they pointed to the infrastructure buildout. But we are already having industrial curtailment, we are already
having companies pull back, specifically energy intensive industries in terms of output, fertilizer producers, aluminum producers.
And we are not even at winter yet. Again, if we have a milder winter, I think we will get through this. But if it is a cold winter, there are going
to be really, really tough budgetary choices made by leaders, tough choices in terms of what industries get gas and which ones have to go without.
SOARES: We will see what packages Liz Truss announces here. What I've been hearing from people up and down the country is that they have to make the
decision between eating and heating. Halima Croft, appreciate it, thank you very much.
Half of Brits have already made up their mind about their new prime minister. The latest opinion poll isn't all that kind to Ms. Truss.
SOARES: Back to our top story. With a visit to the queen at Balmoral, Liz Truss has become Britain's prime minister. In her first address to the
nation, Ms. Truss said the United Kingdom can ride out the economic storm facing the nation.
People all across the U.K. are struggling with the rising cost of living. The price of food, as well as energy, is really straining budgets. Parents
are balancing back to school expenses with very basic needs. And the looming winter really doesn't promise any relief. I spoke to a mother who
is experiencing it all first-hand. Have a look.
BECKA, SINGLE MOTHER: It's become so stressful. I can't sort of cope with it, just sort of burying my head in the sand and just trying to today, by
day, by day.
SOARES (voice-over): Becka is at breaking point. Months into a growing cost of living crisis that is only expected to get worse, she's struggling
with mounting costs.
BECKA: Now I go shopping with my phone out. Everything that goes in, I add it up, then I have to think, then stop getting to a certain amount. If we
don't have what we need, we have to put stuff back.
SOARES: How does that make you feel?
BECKA: Almost like a failure, right.
SOARES (voice-over): A burden no parent should have to feel. But as a single parent, Becka tells me she is doing her best for her 9-year-old
daughter, juggling five jobs, keeping budgets on track, yet still struggling to put food on the table.
SOARES: This is everything you've got from the food bank?
BECKA: Yes, this is what we got today.
SOARES: What's in here?
BECKA: This is frozen chicken.
SOARES (voice-over): It's the harsh reality that's sadly only going to get worse. Inflation is set to hit 13 percent by the end of the year. Add food,
fuel and soaring home energy costs and it becomes unbearable.
BECKA: I used to plan out my meals every week because we could do that. But now I'm not doing it, because who knows what I can afford, you know?
SOARES (voice-over): But for families like Becka's, this week has meant even more spending. Kids are back to school and parents have tough
decisions to make.
BECKA: For the shirts and for summer dresses, I bought them, like, size 12, you know, ridiculously, like, as high up as I think I could manage. She
doesn't wear shoes because it's more cost-effective if I just buy her boots. Then she can be dry in the winter and just sweat it out in the
SOARES (voice-over): It's a dilemma that is felt across the U.K., including here in London, where one teacher here tells me families have
already started asking the school for support.
EMYR FAIRBURN, HEADTEACHER, KING'S CROSS ACADEMY: And really, what can they do when bills are going to go up so much?
How are they going to afford for food?
That's where the parents are asking us and the impact on children's learning could be as great as it was during the pandemic, during lockdown.
SOARES (voice-over): There is no escaping the worst financial squeeze in 60 years but the poorest will bear the brunt of this crisis.
BECKA: We are down to our last thing of pesto.
SOARES (voice-over): The hunger, hardship, the mental anguish and the stigma of poverty.
BECKA: It's really shocking how difficult it is just to have the very basics. I just want to be able to eat real food, heat my house and wear
good clothes. That's what I want to have, you know?
SOARES: It is not really, as she said, much to ask. But it is one of the main challenges. Of course, many people saying that you choose between
heating or eating.
Liz Truss can't bank on much of honeymoon period. British voters, in an opinion poll, 44 percent say they have a negative view of her. Less than
one in five people said they have a positive view. And 60 percent say they want the new PM to call an election this year. Bianca Nobilo joins to
discuss this and much more.
And 60 percent want an election; that is just not going to happen.
BIANCA NOBILO, CNN ANCHOR AND CORRESPONDENT: No, but it's natural that people would feel that way because, as we have discussed, less than 1
percent of the eligible electorate in this country had a hand in appointing Liz Truss as prime minister. That is an understandable concern but it is
the way that the British politics and the Conservative Party works.
Interestingly, those polls have a benefit and a negative for Truss. The benefit being that because she is starting from such a low point of
unpopularity and desperately low expectations from the British public, she has the opportunity to surprise and impress.
That could be possible if she is action orientated (sic) and she hits the ground running, she gets to business straight away.
SOARES: It is a challenge.
NOBILO: The negative also being because she didn't have that much organic support from the parliamentary party, Rishi Sunak had the support of more
MPs, she doesn't have a public mandate from a general election.
Her popularity and the extent to which Conservative MPs back her is going to rest on how they think she is being received by the public. If they
think they are going to be able to hold onto their seats at the next election because of how she is doing, they will back her. If that looks
shaky, they won't.
SOARES: And that is why it is important that she hits the ground running. We are hearing and already seeing the new cabinet shaping up.
But now, what comes down to is business. She is expecting a package of support, of help for those up and down the country because of the energy
crisis. This is going to be her main objective.
NOBILO: It will be, absolutely. This week she said that we are expecting the package to be announced on Thursday. She has Prime Minister's Questions
tomorrow, I'm sure that will be the focus of the questioning.
Given that that is the most pressing issue for most households in this country, Thursday we're expecting a big announcement. The chancellor, Kwasi
Kwarteng, is now in post so they can start formulating all of that. I'm sure she will be having emergency cabinet meetings to make sure that all
departments are on board.
Public spending to that degree, if what we have heard and what we have been briefed is correct, is going to affect every department.
SOARES: Bianca, appreciate it, thank you very much.
That is QUEST MEANS BUSINESS, I'll be back at the top of the hour as we make a dash for the closing bell. Up next, "CONNECTING AFRICA."
SOARES: Hello, I'm Isa Soares. It is the dash to the closing bell, we are just two minutes away. U.S. markets were choppy to begin a shortened
trading week. The Dow has given up all of its gains, you can see that, less than 200 points or so.
The S&P is down about half a percent. The tech heavy Nasdaq is up about 100 points. A new survey suggests the U.S. service sector grew last month. That
might lead some investors to fear more hawkish moves from the Fed.
Here in the U.K., the new prime minister, Liz Truss, is promising to help with high energy prices, among other things. The chief economist for KPMG
told me it won't be cheap, have a listen.
(BEGIN VIDEO CLIP)
YAEL SELFIN, CHIEF ECONOMIST U.K., KPMG: We are now expecting debt to go above the 100 percent of GDP. Obviously, we have two problems here at the
On the one hand, GDP is shrinking because we are expecting a recession. Then on the other hand, we are expecting also costs to rise. There are the
pressures on public spending.
It doesn't mean that you can't do things in the short term. But the key is to think what the tradeoffs are because ultimately it will need to be paid.
And it does mean that ultimately there will be less money at some point to spend on other things.
(END VIDEO CLIP)
SOARES: Yael Selfin.
Now for the Dow component, Visa and United Health are among the leaders. Boeing is up about a quarter percent. Really, as you can see that picture,
no big winners. And plenty of red on your screen; 3M is down well above 4 percent. Intel is about up about 2 percent there, near its lowest price in