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Quest Means Business

Global Warming Fueling Natural Disasters; Israel Ends Military Operation In Jenin; Fed Releases Minutes; Biden, Swedish PM Kristersson Meet At White House; U.S. Navy Stops Iran Seizing Two Tankers; Rhetoric Ramping Up On Zaporizhzhya Nuclear Plant; Russian Soldiers Tell Of Chaos In Trenches; Google May Block Access To News Links In Canada; Scotland Celebrates Coronation Of King Charles III. Aired 3-4p ET

Aired July 05, 2023 - 15:00   ET



PAULA NEWTON, CNN INTERNATIONAL HOST: So summer doldrums already? Let's check in now with the big board that now has slipped more than a hundred


We can call it the summer sideway slide, perhaps. We'll check in with the other markets as well. That is the big board. Those are the markets and

here are the main events.

The reality of climate change sinks in. The planet sees its two hottest days ever.

Fed officials are in agreement, interest rates are going even higher this year.

And Google and Facebook threaten to block news access in Canada. The Canadian Heritage minister joins me to discuss the new law that would force

social media sites to pay for news.

Live from New York, it is Wednesday, July 5th. I'm Paula Newton, in for Richard Quest, and this is still QUEST MEANS BUSINESS.

So tonight, the planet keeps breaking temperature records this week underscoring the climate crisis we are in at this hour. The hottest day

ever recorded on Earth was on Monday and that was only to be broken Tuesday, with an average global temperature of 17.2 degrees Celsius.

Now the previous record set in 2016, the hottest year ever, and we may come to beat that this year. Like in 2016, we are dealing with an El Nino event,

the warming of equatorial waters in the Pacific that tends to lead to warmer global temperatures, and the intensifying effects of climate change.

And already this year, the consequences of global heating have been devastating. Canada has had its worst wildfire season on record, and we are

only halfway through it.

There have been deadly blistering heat waves in India, China, Mexico, and the Middle East. The Southern United States is sweltering right now under

an intense heat dome, and the UK just recorded its hottest June ever.

North Africa has seen temperatures near 50 degrees Celsius. Even Antarctica in winter right now is seeing unusually hot weather.

CNN's chief climate correspondent, Bill Weir joins me now. This isn't your first rodeo. You've been covering this literally from one end of the globe

to the other for years. I want to ask you, are we reaching this tipping point sooner than anyone really expected it? And if we are, well what can

be done about it?

BILL WEIR, CNN CHIEF CLIMATE CORRESPONDENT: Well, in some ways it is, in a way you look at ocean temperatures and how that is moving, this was

predicted in one way or another, you know, for generations of climate science now. And this is exactly how it would be predicted, as the ice goes

away, the earth systems contain and hold down a lot more heat and this is a staggering statistic I found today, Paula.

They actually measure the extra heat captured on our warm planet in Hiroshimas per second, that's the amount of energy in a Hiroshima-sized

atomic bomb.

A few years ago, the oceans were bringing down five of those a second. That's five Hiroshima-sized atomic bombs per second, but that has since

doubled just in the last five years.

So we're seeing this cascading effect, and that is what is really troubling is that at a certain point, you reach a tipping point where earth systems

sort of take over and perpetuate the warmth. As the ice goes away, you lose that reflective ability, the dark water absorbs more heat. You're seeing

some of that.

But the El Nino phenomenon, which is natural is just sort of laying bare how much of that extra heat the oceans have been hiding from us here on

land. And now, it is just, boom through the charts. And you see these charts, it sort of seems like it must be a printing error, where they're

just off any historical record right now, from surface level temperatures, sea surface temperatures, the water that's even deeper there, all the way

across the board. It is really gobsmacking.

NEWTON: So, I have to say what you've just outlined is so alarming, but when climate scientists gamed this out decades ago, Bill, were they in fact

too conservative when they actually predicted what would happen?

WEIR: Yes. I mean, that is absolutely what we are seeing again and again, not only did they sort of get a ride, but it was, the undershot it because

the last thing you want to be seen added in a field of science is an alarmist and get out in front of the data you have now.

But our measurement systems get so much better over time, and some things just happen that you didn't anticipate. For example, so much of California

would burn over a couple of seasons. You're not sure what the ecology is going to be to replace that, so you can't model out the effects of a planet

we've never really quite existed on before. But it's never too late, they would say to stop the worst of this and there is a huge difference between

a planet that is around two degrees above pre-industrial levels and four or five degrees.


And that's what is you're hearing again and again from those who have been sounding the alarm to say we still have agency here if humanity can get its

act together, in the quickest way possible.

NEWTON: Yes, Bill, I mean, we all continue to look for signs of that.

Bill Weir for us, appreciate that.

Now, Jeffrey Sachs is the director of the Center for Sustainable Development at Columbia University, and he joins me now from Athens.

You are one of the people who has been sounding the alarm. In fact, you've said for years that we've been sleepwalking through this climate crisis.

Have we been jolted awake now? And what can be done urgently here?

I mean, what's viable? Because we see a lot of studies, a lot of dire warnings. And yet, we do not see on the horizon next week, next month real



University, the Earth Institute for 14 years, with hundreds of climate scientists. It was a terrifying job because every week, a colleague would

come up to me say, Jeff, it's worse than we thought, and the great climate scientist, my colleague, James Hansen, has been telling me and telling the

world for years, not only are we warming at an alarming and unsustainable rate, but the warming itself is accelerating.

And he has been saying for years that even during the La Nina phase of the Pacific, which cools the planet, we continue to warm. In other words, the

underlying warming was so great that even the La Nina didn't stop the warming process, but he kept saying to me and saying to the world, wait

until we go to an El Nino, boom.

Now, we're in an El Nino and the temperatures are jumping, we're setting records. We could hit and exceed that 1.5 degrees Celsius level within the

next three, four, five years. That was supposed to be the absolute ceiling.

Now, the what to do has been known for a long time, which is to move from the coal, oil, and gas economy to one based on wind, solar, geothermal,

hydropower, nuclear, and others that don't burn carbon, and this has been understood, to move to electric vehicles, to move to heating our buildings

with the electricity rather than heating oil, and so on.

But we have to do it, and we have to do it at a global scale. And Congress has dragged its feet because of the big oil lobby, really corruption

basically for years and years and years, paying these campaigns of our congressmen and so forth. And we, the United States has been one of the

foot draggers in this process, shockingly.

NEWTON: Right. And some would argue, though, that it isn't just the United States that you have to include -- you are someone who said we must include

places like China or India, but I want to get down to something that you --

SACHS: Absolutely.

NEWTON: But I want to get down to something that you've really drilled down on in the last few years, and that is the fact that countries need to

commit to what you call decarbonizing the energy system. How does that work in economic reality today?

We know what the problem is. We've heard it and we can feel it so many of us when we go outside. What can we do today?

SACHS: Yes, here is the interesting thing. Today, we can only take these steps that are needed. Now, what are they? They're very straightforward: To

shift from producing our electricity with coal or oil or natural gas, to producing it with wind, solar, hydro, and so forth; to electrify our

vehicles, to electrify the heating and cooking in buildings, to electrify the parts of industry that can be electrified and to use hydrogen produced

with clean electricity for the parts that can't be electrified directly.

Now, this is all known. We need a plan, a game plan, and we need to finance this. Now, here is the interesting thing about the costs. The costs are

higher upfront, but lower down the road because if you go to solar, you don't pay for fuel down the road. So a higher capital cost, but a lower

operating cost, a lower -- zero fuel cost. The fuel comes automatically from the sunshine.

And so it turns out, if you have reasonable financing, it's not even more expensive over the time of a long-term project. The problem has been the

lobbying, the misunderstandings, the misinformation, and the fact that our government is so much more interested in fighting wars or in having

conflicts with China rather than sitting down and properly discussing how are we going to save the planet together, and that's what we really need to



NEWTON: Right. Now, and understood. You have also pointed out that the Inflation Reduction Act doesn't go far enough in terms of meeting those

goals. But also, studies have singled out here the impact on productivity, agricultural output, of course, human health that we've had, you know,

thousands of deaths due to climate change each and every year.

Where do you see this going, especially when it comes to the industrialized economies versus the developing economies? Because you know, that the

developing economies are looking at us, going why is this our problem? We should be compensated for what you have already done to the planet?

ZACH: Well, first of all, I mean, the alarm bells are ringing. I Zoomed into a sixth grade class in Brooklyn last week to talk to them about these

issues. The kids are wearing masks because of the forest fires in Canada. It's just tragic.

Can't we protect our children? This is the first point. Second, we need to get the financing to enable the poorer countries to be able to do what

needs to be done. They're ready to do it, actually. What they're saying is, fine, make sure we can finance this on the same terms that the rich

countries can, we're ready to do it because we're suffering otherwise.

It is 120 degrees in North Africa. They're not resisting movement on this. It's the same in India, a disaster. But they're saying create a system of

finance. That depends on the US Congress. Vote some money for the World Bank so the World Bank can make a long term loan to a developing country so

that it can have the capital that it needs can make the investment in wind or solar.

It is really not so complicated, but we have to get beyond the oil lobby in the United States, the corruption of the Congress in the United States. We

have to get to real practical solutions.

NEWTON: Which becomes more and more difficult, especially when you see geopolitically just what has happened in the conflict in the last year-and-

a-half, which no one really predicted the outcome of that at all.

Jeffrey Sachs, we will leave it there for now, but I'm sure we will continue to speak to you in the future. Appreciate it.

ZACH: Thank you so much. Great to be with you.

NEWTON: Now, we turn in to the latest developments in the Middle East. Israel launched airstrikes in Gaza today in response to rocket attacks. The

military said it struck an underground weapons facility, its claim, and it comes as thousands of Palestinians marched through the Jenin refugee camp

in the occupied West Bank, burying their dead and vowing revenge.

At least 12 Palestinians including teenagers were killed in Israel's two- day operation in the city that ended on Tuesday. The Israeli army says all those killed were combatants. One Israeli soldier is also killed.

UN human rights experts meantime say the incursion was an egregious violation of international law, and may in fact constitute a war crime.

CNN's Salma Abdelaziz is on the ground in Jenin and she spoke to CNN's Eleni Giokos about what she saw when she arrived. Listen.


SALMA ABDELAZIZ, CNN CORRESPONDENT: It's massive, and that's why I'm coming to you from a bird's eye view, Eleni.

First of all, there is essentially no infrastructure here, no running water, no internet, no electricity. So my cameraman is perched up on a

balcony while I bring you this ground level view of one of the main thoroughfares here in Jenin camp, and as you can see completely torn up,

just piles of rubble everywhere.

The streets turned to mud, and for many families, for many residents that you see walking around me, this is the first glimpse they are getting of

their own homes, they're getting of their own neighborhoods because they were forced to flee in the fighting. They were forced to flee when this

massive incursion began.

And I want you to get a sense of the sheer force of that. Just take a look at this vehicle. Take a look at what's happened to this car and you see

those kinds of images, this kind of vehicles, these scenes just repeated all across this camp.

We understand from the Palestinian Red Crescent that some 7,000 to 8,000 people have now been made homeless by this Israeli raid, but what's even

more extraordinary, Eleni, and I know you have those pictures to show our viewers is that people still feel this is a place of defiance, of


These streets earlier today were filled by thousands of people attending a funeral, a burial for those killed in Israel's raid. Now Israel says it was

taking out a terror network, that it was dismantling weapons sites, that it was neutralizing terrorist sites, what they call a terror hub here in

Jenin, but the Palestinian armed factions that you see again in that video that you see marching through those funerals say, they are resisting, they

are fighting occupation and they will continue to do so even though Israel says it reserves the right to come back anytime.



NEWTON: That was Salma Abdelaziz for us on the ground in Jenin.

Now just ahead, US President Biden is meeting with Sweden's prime minister. The message they're hoping to send to NATO allies and adversaries, next.


NEWTON: It's the first full trading day of the week in the United States and markets, lower. The US Federal Reserve released its Meeting Minutes

earlier. You can see there the Dow, down about a hundred points now. It still forecasts a recession in the near future, possibly starting this


The Fed also indicated there is more monetary tightening to come, which is likely why you see the Dow down.

Now some good news though across the Atlantic, producer prices in Europe, in the Eurozone fell for the first time since 2020. Those prices, of course

feed into consumer inflation.

Matt Egan is with me to try and sort this all out beginning the second half of the year. Good to see you.

When we parse through those Fed Minutes, any more indicators, because at this point, it seems everybody is on pause to just let's wait and see what

the data says coming in the next few weeks and months?

MATT EGAN, CNN REPORTER: Well, Paula, you know that Fed decision last month, officially, that was a unanimous decision to pause the war on

inflation. But we are learning today from these minutes that behind-the- scenes, there was a bit of drama here.

I mean, these minutes show that some Fed officials, they actually favor going ahead and raising interest rates for an 11th consecutive meeting

because inflation is too hot and because the jobs market is too tight.

Now, we know that ultimately, they all got on board and they all agreed to pause interest rates hikes, but the minutes do show that all of the Fed

officials, they do anticipate raising interest rates later this year.

And we also learned some more on this debate around whether or not there is going to be a recession in the United States, because if you recall, back

in April, the Fed staff economist they came out and they predicted a mild recession, which was sort of startling to hear from the Fed, but they may

be losing some confidence in that call, which of course would be good news.

Let me turn your attention to this key line from the Fed Minutes. They said that: "Given the continued strength in labor market conditions and the

resilience of consumer spending, the staff saw that the possibility of the economy continuing to grow slowly and avoiding a downturn as almost as

likely as the mild recession baseline."

In other words, the Fed is coming around to the idea that maybe, there won't be a recession after all. Paula, I think all of this just shows that

like everyone else, like other economists, like all of us in the media, like investors, we're just trying to make sense of how this economy has

maintained so much strength and how much more inflation fighting medicine it can handle.


NEWTON: Yes, and Matt, given what we just heard in the minutes, and given the fact that we have entered the second half of the trading year, I mean,

are markets really taking a pause here? Because sometimes, the Fed speaks, the minutes speaks, and they just ignore it. They just do what they want

with the market.

EGAN: Well, what is interesting is markets are actually off their lows of the day. The Dow is down about a hundred points, 0.3 percent, earlier down

almost 200 points. So nothing in the Fed Minutes seems to have overly concerned investors. You could see the market bouncing off those lows.

I do think that a pause here, though, Paula, when the markets makes a lot of sense. I mean, this was the best first half of the year for the NASDAQ

in 40 years, which is pretty incredible.

So the fact that it is down by 0.3 percent essentially unchanged on the day, dipping earlier this week. You know, that's not such a bad thing,

because we know that markets can't go straight up and we do know that there are a lot of challenges out there, including the potential that the Fed

continues to raise interest rates later this year.

NEWTON: Yes, I did notice that the dollar index was up. So that likely means people are expecting higher rates and so illuminating, as you did,

the conflict within the Fed itself, that's likely where this is headed.

Matt Egan, good to see you. Thanks so much. Appreciate it.

Now, US president, Joe Biden says, he is looking forward to Sweden becoming a NATO member. He has been talking with the Swedish prime minister, Ulf

Kristersson at the White House. Their meeting, that is, will come ahead of next week's NATO Summit, and it demonstrates Mr. Biden's commitment to

Sweden joining the Alliance.

Have a listen to what the leaders had to say just a short time ago.


JOE BIDEN, PRESIDENT OF THE UNITED STATES: We're also prepared for the NATO Summit next week and I want to reiterate, the United States fully, fully,

fully supports your membership to NATO. And the bottom line is simply, Sweden is going to make our Alliance stronger, and has the same value set

that we have in NATO, and really looking -- anxiously looking forward for your membership.

ULF KRISTERSSON, SWEDISH PRIME MINISTER: And I also would like to say that we highly appreciate your strong support for Sweden's NATO accession. That

means a lot to us. We do seek common protection. But we also do think that we have things to contribute with, to be a security provider for the whole

of NATO.

BIDEN: It is clear.

KRISTERSSON: I very much look forward to our talks here today.


NEWTON: So I want to bring in Kevin Liptak, who has been at the White House following all of this for us, and despite what we hear the president just

say, because he said, look, this is simple. He used the word "simple," I'm sure, Kevin, because the White House knows better than anyone how

complicated this file is, in terms of Sweden joining NATO.

I mean, did you expect to see any more developments, especially in the lead up to that NATO meeting?

KEVIN LIPTAK, CNN WHITE HOUSE REPORTER: Well, I'll tell you, this time last year, when we were all in Madrid covering the NATO Summit there, and

Finland and Sweden both made their formal applications to join NATO, the belief among American officials and at least the hope among American

officials was that would be completed by this year's Summit in Lithuania.

And of course, that Summit is now a week away, and there is not a lot of optimism now among White House officials that Sweden will be able to join

NATO, of course, because of that impasse that Turkey is putting up to Sweden's membership in the Alliance, and I think that is a disappointment

because certainly, it would have been highly symbolic for these two countries that had for decades been non-aligned, Sweden and Finland to join

the Alliance at a moment when the West is really trying to show unity amid Russia's invasion of Ukraine. And President Biden certainly had hoped that

President Putin of Russia would regard this as a show of Western strength.

Now, over the course of the last several months, US officials had been trying to work with Turkey to break this impasse. And there had actually

been some hope that once President Erdogan had gotten through his elections in May, that he would drop some of his opposition to Sweden joining NATO,

but that certainly doesn't appear to be the case.

Now, we do understand that officials from all three of these countries -- the US, Sweden, and Turkey -- will be discussing this matter over the

course of the next week in the lead up to the Summit. We don't know yet whether President Biden and President Erdogan will meet while they are

there in Lithuania.

But certainly, the hope had been that this symbolic move would have been in place in time for this Summit.

You do have Finland, that membership was approved in April, so that is something that President Biden is certainly ready to discuss in earnest and

in fact, he'll be going to Finland next week as well to sort of punctuate that process.

But certainly, Sweden remains to be seen and you heard President Biden in the Oval Office just now say that he is anxiously awaiting whether that

process will be concluded.


One thing I think that we should keep our eyes very closely peeled for is some development in the sale of US fighter jets to Turkey because President

Biden has directly linked these two things when he spoke to President Erdogan in May. He said that he hoped that there would be some progress on

this fighter jet issue in parallel with some progress on this issue of Sweden joining NATO.

So that's something that I think we should watch very closely, but certainly, as of now, as of this hour, there's not a lot of optimism that

this issue will be resolved by next week -- Paula.

NEWTON: Yes, and as you said, though, those fighter jets certainly an important piece of leverage that the White House is putting on the table.

Kevin Liptak for us, appreciate it.

Now, a US judge has ordered President Biden's administration to stop asking social media companies to moderate their content. Now, the temporary

injunction impacts government bodies, including the FBI and the Centers for Disease Control. It's part of a lawsuit brought by Republican prosecutors

opposing government attempts to suppress posts that encourage COVID denialism and vaccine hesitancy.

Now, they argue these actions restrict freedom of speech and amount to censorship of conservative voices.

CNN's Vanessa Yurkevich is with me, and you have the unenviable task of trying to explain this to people because when you just look at it, on the

face of it, it seems basically they're saying the executive branch and government agencies cannot tell social platforms what to do at all.

VANESSA YURKEVICH, CNN BUSINESS AND POLITICS CORRESPONDENT: Essentially, if you distill it down to that. This was a 155-page injunction. But just so

viewers understand exactly what it's saying, basically, there are about nine federal agencies and more than a dozen key officials in the Biden

administration that can no longer communicate with social media companies.

And those include, as you mentioned, the CDC, the FBI, Justice Department, State Department, White House press secretary, US Surgeon General cannot

speak to TikTok, Facebook, and Instagram, WeChat, except for if they notice any illegal activity or see any national security threats.

But this comes after a 2022 lawsuit that two state attorneys generals filed against the Biden administration, GOP attorney generals, saying that the

Biden administration colluded with social media companies, asking them to address and suppress information about COVID-19 theories, election

integrity, vaccine efficacy, as well as stories about Hunter Biden and the president himself, thus breaching the First Amendment.

However, the White House is saying that they were only speaking to these social media companies in the best interest of the American public,

especially during the pandemic, when there was so much misinformation around COVID-19.

The White House also saying that the DOJ is going to be looking into this, seeing what their options are with this case. White House also saying that

it is up to social media companies to figure out what content is on their platforms, and ultimately up to those social media companies to figure out

what to do with it.

But this judge saying that he has seen enough evidence to grant this injunction, also saying that if these plaintiffs, these two state attorneys

generals are successful in their lawsuit, that this would, "be the most massive attack against free speech in US history."

Now, this judge, Judge Doughty is a Trump appointee. He still has to make a ruling in the lawsuit, in that case, but this injunction, this basically,

blocking of communication between the Biden administration and these social media companies is a win for these states who have brought this lawsuit.

Paula, we also reached out to the social media companies, wanted to see what they thought about this. The only one that we heard back from is Meta.

They had no comment, but interesting to see how they really feel. Do they like having the federal government pointing out problematic content to

them? Or do they want them to stay out of it?

We know, Paula, that it has been hard sometimes for these social media companies to police all of the content that's out there, especially if it's

harmful and promotes misinformation -- Paula.

NEWTON: Yes, and we hear you, Vanessa when you say, look, it's over to you the Department of Justice to see what options you have on the table as this

goes forward.

Vanessa Yurkevich for us, appreciate the update.

Canada's battle meantime with tech giants, Meta and Google seems to be heating up again, but the Canadian Heritage minister says yes, there is

hope for resolution. He joins me after the break.




NEWTON (voice-over): Hello, I'm Paula Newton. There is more QUEST MEANS BUSINESS in a moment, when we will give you a closer look at what's

happening inside the Russian trenches in an extraordinary interview with the Russian soldiers.

And Google and Meta say they will block Canadian news from their platforms in a tit-for-tat dispute over a so-called link tax.

Before that, though, these are the headlines this hour.


NEWTON (voice-over): The U.S. Treasury Secretary Janet Yellen is hoping to improve relations between the world's two largest economies. Yellen has her

work cut out for her. China this week imposed export restrictions on rare materials used to create computer chip production.

Tense moments today in the Gulf of Oman. A U.S. Defense official says the U.S. Navy intervened to stop Iranian naval ships that were attempting to

seize two oil tankers, in separate incidents in international waters. The official says one Iranian ship opened fire on the tanker in the second

incident. No one is reported as injured.

The Secret Service says the substance found at the White House on Sunday was cocaine. A source familiar with the incident says it was found near a

ground floor entrance used by visiting tours.

The discovery on Sunday triggered a brief evacuation. President Biden was at Camp David and returned to the White House yesterday.

Following U.N. approval, Japan will soon begin releasing treated radioactive water from the Fukushima nuclear plant into the ocean.

Officials say the water will be highly diluted and released over several decades.

It has been 12 years since the plant's meltdown; 500 Olympic pools' worth of wastewater have been stored by the Tokyo electric power company, which

says space is running out.

Taliban leaders are giving all beauty salons in Afghanistan one month to shut down. This is just one of many restrictions on women that have been

seen there since the return of the Taliban in 2021.

Salons are usually female only and provide women with jobs.


NEWTON: Russia and Ukraine are trading accusations over a possible attack on Europe's largest nuclear power station. The Kremlin said the potential

for sabotage at the Zaporizhzhya plant by Ukraine is high.


NEWTON: And he is warning of the consequences. President Zelenskyy says Russia is the only danger to the plant. He spoke about his concerns in a

wide ranging interview, take a listen.


ERIN BURNETT, CNN HOST: In Zaporizhzhya, I know you have been touring the nuclear plants. You have warned that Putin could be prepared to have a

terrorist attack on Zaporizhzhya.

Do you feel that that could be imminent?

VOLODYMYR ZELENSKYY, UKRAINIAN PRESIDENT: So I have real from intelligence. I have documents. I don't -- I can't tell you what kinds of documents but

it is something connecting with Russia. I said that they are technically ready to do something. It is very important that they mind some local

minings, yes --


BURNETT: At Zaporizhzhya?

ZELENSKYY: Yes, in the station. They technically are ready. And that is why we pushed (INAUDIBLE) --



ZELENSKYY: -- IAEA, yes, IAEA. Yes, we push them and we said, look, your team there -- your -- there are four people. And this plant is like city.

It is really like huge --


ZELENSKYY: -- it is huge. It is very big. And four people will not find mines (ph).


NEWTON: You can see the full interview with president Volodymyr Zelenskyy a few hours from now, that is at 7 pm in New York, midnight in London.

In an extraordinary report, Ben Wedeman interviewed several Russian soldiers who are now prisoners of war in Ukraine. They tell us how they got

caught up in the war and reveal the chaos within parts of Russia's military. Here's his report.


BEN WEDEMAN, CNN SR. INTERNATIONAL CORRESPONDENT (voice-over): No longer on the front lines, Anton (ph) recounts how he ended up a prisoner of war.

Back in Russia, he was behind bars for the third time for drugs.

"When they put me in prison, I heard they were recruiting. Serve six months and they pardon you," he tells me.

So he signed up with Storm Z, a unit made up of convicts, attached to the Russian defense ministry. After only two weeks of basic training, he was

shipped off to the front lines near Bakhmut.

After days of intense shelling, with no food and only rainwater to drink, he heard Ukrainian troops outside his foxhole. He assumed they would

execute him.

"I thought that was the end," he recalls. "I switched my rifle to single shot mode and thought, 'I'll shoot myself.' But I couldn't."

This video, shot by soldiers of Ukraine's third assault brigade, shows the tense moments when Anton (ph) and his comrade, Slava (ph), surrendered. The

Ukrainian troops told them, "Unlike Russians, we don't kill prisoners."

We spoke to Anton (ph), Slava (ph) and another soldier in a makeshift jail in Eastern Ukraine, concealing their faces and not using their real names.

The third assault brigade granted us accused to the POWs and two of their soldiers were in the room for the interviews.

The POWs will soon be transferred to Ukrainian intelligence. They did not appear to be under duress and agreed to share their stories.

Slava (ph), also serving time for drugs, said conditions in the trenches were grim.

"Food was scarce. We didn't have medical kits," he says.

His commanders took all the pain killers to get high, he recalled and, as a result, issued nonsensical orders. Morale was terrible.

Sergey (ph) was wounded by a grenade before surrendering to Ukrainian troops. He was a contract soldier, not a convict. He completed his six-

month contract in Kherson and went home.

But when he hesitated to sign another contract, a military prosecutor gave him a choice: prison or back to the front. He ended up outside Bakhmut.

Under constant Ukrainian fire, discipline collapsed.

The officers fled, all illusions were shattered.

"It was very different from what I saw on TV, a parallel reality," says Sergey (ph).

"I felt fear, pain and disappointment in my commanders."

A law passed last year in Russia imposed sentences of 3-10 years for soldiers who surrender voluntarily. If he returns home in a prisoner

exchange, Anton (ph) may end up --


WEDEMAN (voice-over): -- again, back in a Russian prison -- Ben Wedeman, CNN, Eastern Ukraine.


NEWTON: Coming up for us, we speak to the Canadian heritage minister about his government's battle to take on Big Tech.




NEWTON: Canada says resolution may be possible in its battle with Google and Meta but heritage minister Pablo Rodriguez says the government is

suspending advertising on at least the Meta platform for now, as they continue to figure out this new legislation.

Last month, Canada passed the Online News Act, which will require tech giants to pay news outlets for content. Google and Meta pushed back against

the so-called link tax, saying they will block Canadian news from their platforms in response.

Pablo Rodriguez is the minister of Canadian heritage and he introduced the Online News Act last year.

You are the man, certainly in the firing line right now.

But I have to ask you, did this new law backfire?

Because Canadians in certain instances, if not now, then soon will be blocked from either searching for Canadian news or finding it on their

social media platforms.

PABLO RODRIGUEZ, CANADIAN MINISTER OF FOREIGN HERITAGE: No, Paula. This law is absolutely necessary. But you mentioned the word tax at the beginning.

And this has nothing to do with a tax, because not a penny is going to the government.

It's not costing Canadians a single cent. Without this bill, those Web giants would not make deals or with platforms it is absolutely necessary to

move forward, because, in Canada, about 500 newsrooms closed their doors in the last few years, big or small, in cities or rural communities. And it is

a huge problem for our democracy.

NEWTON: Yes. I'm glad you mentioned what is happening to those to Canadian NEWSROOMs. If you could explain for our audience, what you want to see out

of this. Legislation is there now, you want these organizations to negotiate.

What do you hope will then happen to the Canadian news landscape?

RODRIGUEZ: It's important to know that 80 percent of all ad revenues is going to two companies in Canada, Google and Facebook, so it's about $10

billion out of $13 billion. Because of that, the money is not going to all those traditional news outlets.

Those media that we have need in a democracy, independent, free, nonpartisan newsrooms are disappearing. I would say it's the same in United

States. I read somewhere recently that two newspapers are closing the door every week, sometimes small ones.


RODRIGUEZ: But those small papers are playing a big role in their own community. Local news matters. So what we are saying here is that we want

to build where the government is arm's length; we are simply putting a table in the middle of the room. We sitting to one and the giants on one

side, Google and Facebook.

And the (INAUDIBLE) on the other side and they have to get to agreements. It is (INAUDIBLE) arbitration. It's very simple.

NEWTON: OK, it's very simple. And yet the social media platform so far are saying we will not play ball. Let me get to their response. I know you said

that you believe there is still perhaps a deal to be had with Google, at least for now. Let me get to their response.

They are saying we are willing to do more. We just can't do it in a way that breaks the way that the web and search engines are designed to work.

And that creates an untenable product and financial uncertainty. That is from Google.

Meta was much more strident, as you know. They are saying, asking a social media company in 2023 to subsidize news publishers for content that isn't

important to our users is like asking email providers to pay the Postal Service because people do not send letters.

Minister, I have to ask you, was this law ill-conceived?

You know I have followed it very closely. There were amendments proposed by your own senate. They were rejected, a lot of lobbyists spoke to this in

committee ad nauseam. And yet, we are still at an impasse.

What can you do to make sure this law actually serves Canadians?

RODRIGUEZ: Well, we are there because these companies don't want to be regulated. This bill could be anything else. Actually it is a bit like the

wild west; they have no regulation. You and I have rules to follow. You and I have to follow the law.

Try not to follow the law which can happen to you, right? (ph)

Why do we have giant companies coming to here or even in the States or anywhere, saying we are going to do whatever we want?

We are simply asking, them it is not subsidizing the media. It is simply paying their fair share; not more, not less, their fair share. What you are

doing now, Paula, has value. What you're doing is extremely important, asking tough questions has value. The people in that room, the researchers,

people working with you in the office, what they do has value.

It has to be recognized by the tech giants. It's as simple as that.

NEWTON: But if it's not, they are going to take their marbles and go home. You know they have tried to push lots of different industries around and

been highly successful.

I want to ask, you do you think you are taking this on in that other countries around the world are watching?

This is happened in Australia, it's worked to a certain extent. And yet, we don't have any proof is going to work in Canada yet or in any other


RODRIGUEZ: It did work in Australia and actually especially for the small media outlet, because on average they've gotten more money than the big

ones. We still have domestic and again we have for elected maybe discussions with Google, are they tough?

Yes, sometimes they're very tough. It is normal. Google wants some certainty, more predictability, which is totally normal from a business

perspective. I was in the private sector for a while and what they are asking for it's totally reasonable.

And we think that (INAUDIBLE) regulations will be able to meet pretty much everything that they ask. So that is Google.

And I'm telling Meta, why don't you can put us, guys?

Sit at the table and discuss.

NEWTON: We will continue to follow the story. As I said, it has piqued a lot of interest around the world, not just in Canada. Pablo Rodriguez,

thank you so, much we really appreciate it.

Now switching gears, in Mongolia, the goat population outnumbers the human one by more than 8:1, think about that. Soaring demand for cashmere made

from goat's wool has triggered a huge expansion in herding in recent decades.

In 2021 about 40 percent of the world cashmere came from Mongolia. In this clip from our show, "Made In...," we explore how the country can benefit

even further from a growing industry.



UNIDENTIFIED MALE (voice-over): Ulaanbaatar, Mongolia's capital. Most of the country's raw cashmere passes through the city, before making its way

to factories around the world. Up to 90 percent of Mongolian cashmere leaves the country long before it becomes a sweater, according to the Asia

Development Bank.

Some of the rest ends up here. In a factory on the outskirts of Ulaanbaatar, Gobi cashmere says it makes 2.3 million products a year. Its

flagship cashmere store in the city center is the largest of its kind in the world, the company says.

MISHEEL OTGONTUGS, EVP, GOBI CASHMERE (voice-over): Gobi was established in 1981. Back then, it was a state owned company but it was privatized in

2007. And ever since this transition, we've been expanding tremendously in terms of factory capacity, sales volume, employee numbers.

UNIDENTIFIED MALE (voice-over): Although a third of Gobi's sales now come from customers abroad, every scarf, coat and blanket is entirely made in


In the factory, that process starts here, where workers will define fibers from the coarser parts of the goat's underbelly fleece.


UNIDENTIFIED MALE (voice-over): Then, machinery cleans and refines the cashmere until only fluffy clouds remain. Other machines dye or blend the

cashmere, web it into thin sheets, spin it into a yarn and weave yarns into fabric.

Soon, it is on to the finishing touches. All in all, the process involved is around 1,500 people, Gobi says. But Mongolian cashmere manufacturers may

need a much bigger workforce to compete at an international level, according to experts.

ELAINE CONKIEVICH, U.N. DEVELOPMENT PROGRAMME: The industry is still a little bit trying to improve, as far as the capacity. So one thing that,

for example, we have done is help to increase the number of students who are studying engineering technology for the fiber sector, to place more

technical specialists in the industry here in Mongolia.

UNIDENTIFIED MALE (voice-over): Keeping more of the cashmere supply chain in Mongolia could help the sector grow, from about 3 percent of GDP to 10

percent, the U.N. Development Programme estimates.

That means more profit for the people who make cashmere and, for the consumers, are products they can trace from goat to coat.


NEWTON: Just ahead for us, a coronation celebration in Scotland. But not everyone had a warm welcome for King Charles. We will have all the details,

just ahead.




NEWTON: Scotland is officially celebrating Britain's new monarch, marking the royal coronation of King Charles III and his wife, Queen Camilla. They

were crowned in May in London's Westminster Abbey, you will remember.

But today's festivities saw the king presented with Scotland's crown jewels, Britain's oldest, dating back to the early 16th century. The pomp

and pageantry was not welcomed by everyone. Protesters lining the streets outside Edinburgh's St. Giles' Cathedral could be heard booing the monarch.



UNIDENTIFIED FEMALE: There is the crown of Scotland.

UNIDENTIFIED FEMALE: The fanfare, Balmoral flourishes.


UNIDENTIFIED MALE: And today, we welcome her heir, King Charles III, to be presented with the honors. Our help is in the name of the Lord, maker of

heaven and Earth. Let us worship God.


UNIDENTIFIED MALE: As we offer these to the king, we celebrate the peace and unity of our land and its people. And together, we dedicate ourselves

anew to serving the common good of our nation.

UNIDENTIFIED FEMALE: By the symbol of this sword, we pledge our loyalty.

CHARLES III, KING OF THE U.K.: And receiving this sword, I so promise by God's help.

UNIDENTIFIED FEMALE: By the symbol of this scepter, we pledge our loyalty.

CHARLES III: In receiving this scepter, I so promise by God's help.

UNIDENTIFIED MALE: By the symbol of this crown, we pledge our loyalty, entrusting that you reign as our king in the service of all your people.

CHARLES III: In receiving this crown, I so promise by God's help.


NEWTON: Historic events there in Scotland today.

There are just moments left for the trade in Wall Street. We'll have the final numbers and the closing bell when we come back.




NEWTON: So the Fed is still forecasting a mild recession and more monetary tightening. U.S. markets were lower before those meeting minutes were

released. The Dow has been in the red all day but as you can see from the chart, it absolutely picked up steam after those Fed minutes.

Want to look at some of those Dow components. Intel is at the bottom. China is imposing new export controls on materials used in computer chips. Banks

were also lower, as you can see, by the charts, still trying to parse what the Fed is going to do on interest rates.

A few winners to report as well, those credit card stocks are up, perhaps anticipating less of a recession or perhaps no recession. Walgreens and

Salesforce are also leading at this moment. We will continue to watch that stock market as they parse more of those Fed minutes.

Again, a reminder, the Nasdaq was sideways, after coming off a great first half of the year.

That is QUEST MEANS BUSINESS, I'm Paula Newton, we hear the bell. It's ringing on Wall Street. "THE LEAD WITH JAKE TAPPER" starts right now.