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Quest Means Business
Trump Seeking a "Political" Running Mate; U.S. Senate Minority Leader Endorses Clinton; 23 Feared Dead in Nepal Plane Crash; Hungarian PM Plans Referendum on Migrant Quotas; Apple CEO Faces Congress Committee Deadline; Congressman Tells FBI to Back Down on Apple; Facebook Makes "Reactions" Available to All; Airbus CEO: Oil Prices Not Impacting Sales; Enders: Britain Should Stay in the E.U.; Enders: Iran Deal An Important Milestone; Chinese Drivers Miss Out on Cheap Oil; DEF Jam Founder to Host Rival Awards;
Aired February 24, 2016 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:00]
RICHARD QUEST, HOST: Strange day on the markets. The Dow was down for most of the session then ekes out a gain in the last hour, hour and a half.
These ladies and gentlemen clearly got the memo to wear orange as they rang the closing bell. Oh, dear. A very wimpy gavel from the men and women in
orange to round out trading on Wednesday, it's the 24th of February.
(BEGIN VIDEO CLIP)
QUEST: Tonight, Trump towers above field in the race for the Republican nomination. I'll speak to one of the men who tried and failed to stop him.
Christine Lagarde tells us the IMF is ready to act in case of a commodity crisis.
And when a Facebook like just isn't enough. We're going to invite you to meet the reactions.
(END VIDEO CLIP)
QUEST: I'm Richard Quest, we've an hour together, and I mean business.
Good evening. Winning, winning, winning that was Donald Trump's declaration after victory in Nevada's Republican caucuses on Tuesday night. A stunning
result for the real estate mogul, his bid for the party's Presidential nomination keeps gaining momentum.
(BEGIN VIDEO CLIP)
QUEST: Mr. Trump's third straight win leading up to Super Tuesday makes the chances of his Republican rivals look ever slimmer, and his nomination ever
closer. At a campaign event earlier, he said he is beginning to think about his running mate and is ready to finish the job.
DONALD TRUMP, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: The most important thing is you have to have somebody that can be a great President. But after
that, you want somebody that can help you with legislation, getting it through, et cetera, et cetera. So I would say without -- and it's too
early. I'm not thinking about it a lot. I'm thinking about getting the ball over the line and you know, get this thing done.
(END VIDEO CLIP)
QUEST: CNN senior's political reporter is Stephen Collinson, he joins me from Washington. Stephen, look really, all we need to know is what -- how
close to inevitable is this for Donald Trump to get the nomination?
STEPHEN COLLINSON, CNN SENIOR POLITICAL REPORTER: Well, Richard, if we had been talking about anybody else who'd won the first three contests outs of
four in the Republican nominating race we would be saying they were inevitable. But it's you know Donald Trump is such a unique character, he's
so brash, he's so bold, so many Republicans actually don't believe that he's qualified to be President.
(BEGIN VIDEO CLIP)
COLLINSON: I think we have to be a little bit cautious here. After all we've only had 5% of the total delegates awarded in the race. But you're
right. He is gathering momentum race by race and he is going to do very well on Super Tuesday next week. 11 Republican states are up and he is
going to do well there.
QUEST: All right, I'm going to push you hard on this Stephen, because you know you just basically said to me and you have agreed that any other case
we'd be saying it's inevitable, it's over, almost it's over.
(END VIDEO CLIP)
QUEST: But tell, how does the opposition defeat this? Let's say Kasich goes, Carson goes. You've still got to hope that all that support goes to
either Rubio or Cruz, not any to Trump.
COLLINSON: Right, and you've put your finger on it there. The problem with this race is three is a crowd.
(BEGIN VIDEO CLIP)
COLLINSON: If there was one establishment or one conservative candidate who could coalesce the opposition to Donald Trump, I think it's very likely
that Donald Trump could lose. The problem is is that Senator Rubio and Senator Cruz, they're getting 20, 22% in each primary. There's no reason
for them to get out. And they're are also fighting for the soul of the Republican Party. They are young 40-something senators. They see they have
not just this Presidential election, if they don't win they have several more elections. There is no reason for them to get out. And that's one of
the reasons why Donald Trump looks like he may squeeze through here.
(END VIDEO CLIP)
QUEST: Right, but even if - let's take Cruz for example. I mean he is not loved any more by the establishment -- maybe a little bit more he is loved
by the establishment than Donald Trump simply because he is a senator and he has worked there.
(BEGIN VIDEO CLIP)
QUEST: But he is loathed by many of his colleagues in Washington.
COLLINSON: That's true. But that's the key to his appeal. In this Presidential race being loathed by Washington is a badge of honor. That's
you know - that's why Cruz has done quite well. That's the card that Trump is trying to play.
The establishment is coalescing around Rubio. The problem, it's not clear that the voters are going to coalesce around Rubio.
(END VIDEO CLIP)
COLLINSON: Rubio's not won anywhere. It doesn't look like he could win anywhere until mid-March when his own state of Florida comes up and Trump's
very strong there.
(BEGIN VIDEO CLIP)
COLLINSON: So absent a win or several wins by Rubio it's not clear that he is strong enough to emerge as the anti-Trump. Despite the fact that all the
Republican establishment and probably 60% of Republican voters who probably prefer to see him as the nominee rather than Donald Trump.
(END VIDEO CLIP)
QUEST: All of which makes for enormous machinations and at some point you and I need to talk about on another occasion what is a brokered convention.
So please get - please get your books out -
[16:05:10]
COLLINSON: OK, I'll swat up on that.
QUEST: Swat up on brokered conventions when we last saw one. Thank you very much Stephen, good to see you.
COLLINSON: Thank you.
QUEST: Now, the latest estimate for the Republican delegates. Just look at this. There you've got 82 pledged for Donald Trump, 17 for Ted Cruz, 16 for
Marco Rubio.
(BEGIN VIDEO CLIP)
QUEST: There are more than 600 delegates up for grabs on Super Tuesday, which is less than a week away. And the Republican Party seemingly coming
around to the idea that Trump - just look at these; you've got vast, delegate-rich states. Texas down there with 155. You have got Georgia also
with a massive amount of stakes. All the way -- Tennessee, and up into the northeast. Massachusetts up as well. And out over into Alaska with 28. 600,
give or take.
But can Donald Trump get some of -- many of these? And does it make him pretty much invincible towards the nomination? Trump won the first two
endorsements from members of congress. Duncan Hunter of California. He is - - has endorsed Mr. Trump. And Chris Collins of New York, the Head of the Republican National Committee says he and the party will support which
every candidate wins the nomination.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
REINCE PRIEBUS, CHAIRMAN, REPUBLICAN NATIONAL COMMITTEE: We're going to embrace whoever the nominee is. I embrace all of these candidates. I
embrace them all. So we're going to determine the delegates coming through March. And whoever the nominee ends up becoming, they are going to inherit,
or they are going to join, I should say, the biggest RNC operation that we've ever put together.
(END VIDEO CLIP)
QUEST: Now we are delighted to have a former chairman of the Republican National Committee with us now who has expressed fears about where Trump
would lead the party and the country.
It's Jim Gilmore who is the former Governor of Virginia. He ran in this election against Trump for the nomination. He suspended his campaign
earlier this month. In this video from July, Governor Gilmore explains why he decided to run in the first place.
(BEGIN VIDEO CLIP)
JIM GILMORE, FORMER GOVERNOR OF VIRGINIA: I've been looking for someone to enter the race committed to my belief that America's economic and national
security is increasingly at risk. But I haven't seen a response from anyone that makes me certain about their knowledge or solutions to the threats
facing our nation.
(END VIDEO CLIP)
QUEST: Governor Jim Gilmore joins me from Washington. Sir, thank you. We've invited you today because as a former Republican National Chair and as a
life-long GOPer, to get your gut feeling about the way you think your party maybe has been hijacked by the Trump band wagon?
GILMORE: Well, I wouldn't use the word hijacked Richard. Thanks for having me on. And my -- my state is one of the states that's going to be voting
this next week in Super Tuesday. But I don't think that the party's being hijacked. I think that we have a process in place that's allowing for a lot
of people to vote in the primary. And we can now see that Donald Trump has the momentum.
(BEGIN VIDEO CLIP)
GILMORE: But I think in the end the Republicans are going to come together in order to support a candidate that's against the Democrats. The Democrats
are very clear what kind of candidate they are going to offer. They are either going to offer Hillary Clinton or Bernie Sanders. And that's not the
direction that the United States should go.
(END VIDEO CLIP)
QUEST: So can you -- will you live with, endorse, campaign for candidate Trump if he gets the nomination? That's the key question, sir.
GILMORE: Well, let me be direct with you. I've stated very loudly and in public and in one of the debates that I was a participant in that I have
some disagreements with Donald Trump's language, attitude and sort of approach to things.
(BEGIN VIDEO CLIP)
GILMORE: But at the end of the day, yes, I think that the Republican Party -- and I would support the Republican nominee who is going to be running
against Hillary Clinton or Bernie Sanders. Richard, look, I've just got to say that the left wing in this country is offering a one pronounced
socialist and the other sort of a disguised socialist. And we know that socialism doesn't work in the United States, it didn't work and isn't going
to work anywhere.
(END VIDEO CLIP)
GILMORE: So we have to stop the Democrats from taking that kind of economic approach to the United States and to the world. And the best way to do that
of course is to offer a candidate that can win.
QUEST: So the RNC -- we're hearing a lot of back chat within the RNC, within the party grandees within - you know people are saying there is a
moment or a sense of -- my word -- I'll accept, governor -- my word, but there is a sense of panic at the prospect that Trump could get the
nomination. From what you're hearing amongst the establishment, is that the case?
[16:10:05]
(BEGIN VIDEO CLIP)
GILMORE: Well, first of all, I don't know what the establishment is thinking. And I do not describe this as panic in any way, shape, or form. I
think that our candidate is going to be out there, and I hope he's going to offer an alternative to the far left that's in control of the Democratic
Party at this time.
And no, I don't think that the Republican Party is in a state of panic. And listen, let me be clear with you. RNC outsourced this nomination to the
press.
(END VIDEO CLIP)
GILMORE: And when they did that, they made these kinds of votes inevitable to a candidate like a Donald Trump. They have only themselves if they're
panicked to blame. But I'm not panicked. I think that we're going to offer a candidate that is going to run well against the far left wing of the
Democratic Party that is running their nomination process.
QUEST: So how does Donald Trump, if he gets the nominee -- nomination, you know, sir, from a lifetime in politics, you don't win by only having
support from your base. You have to get the crossover support of those in the middle. So how do you -- I mean, yes, you may get all the republicans
on board and that's questionable. But how -- if it's a Trump candidacy, how do you get those Democrats to hive some of them off to join you?
GILMORE: Look Richard I've already said in public that I think that Donald Trump has said thing towards groups of people in the United States that's
not helpful. Not helpful to the party, not helpful to the nation. Not even helpful to Donald Trump when the time comes to go to a general election.
But frankly, at the end of the day we're going to make the case that we are going to demand that Hillary Clinton and Bernie Sanders step up to the
plate and talk about how they are going to grow the American economy. Now many of your viewers are Europeans and you know what stagnant growth means
in Europe. Well we've had stagnant growth in the United States also. And it's not acceptable. So we have to do something to offer a positive
approach to the economy of the United States, more jobs, more opportunities. And if we do that, we're going to do just fine whether the
nominee is Donald Trump or one of the other guys.
QUEST: Finally, sir, have you ever seen an election quite like it?
GILMORE: No. God, no. I was in the race of course and offered myself with the credentials that I have for the Presidency.
(BEGIN VIDEO CLIP)
GILMORE: But at the end of the day, know, I was not able to continue the race as much as I would like to be the President of the United States --
and I think I'm able to be the President of the United States. But this was some kind of race with a lot of different kind of people that are in it.
But at the end of the day, the people of the United States through the primary process are going to make this choice. I didn't like the way that
it was outsourced this whole process, and I've said so.
(END VIDEO CLIP)
GILMORE: But at the end of the day I believe the Republicans can offer the kind of direction for the United States that will be a better direction
than we're going to see out of either Hillary Clinton or Bernie Sanders. And I call on those people, Sanders, and Clinton ought to step up now and
say how they are going to grow the economy of the United States. And they are not willing to do that.
QUEST: Sir, thank you for coming in and talking to us and we look forward to having you on the program again as we wend our way through the electoral
process in America. Thank you, sir.
GILMORE: Thank you, Richard.
QUEST: All the remaining Republican candidates have just one more T.V. debate before Super Tuesday. And it's live and well, where else would you
expect it to be? Here on CNN of course. Republican Presidential debate head to head on Thursday night, 1:30 Friday morning in London. You'll want to
stay up. If you can't stay up, then you'll have a chance to see it the next day. A special program, "America's choice," will have all the highlights at
noon London time, 1:00 Central European.
The consequences of a "brexit" are already being felt both in the markets and in the anticipation. You're going to hear from the head of the IMF who
says Britain and the E.U. will suffer if they go their separate ways. Christine Lagarde on "Quest Means Business."
(END VIDEO CLIP)
(COMMERCIAL BREAK)
[16:15:20]
(BEGIN VIDEO CLIP)
QUEST: Well have a look at what happened on the Dow Jones during the course of Wednesday. And you will see this very interesting late rally just after
3:00 o'clock in the afternoon. It goes down quite sharply and merry well heads back up again. And the reason -- the reason for that late rally is
oil prices rose late in the day. And that price rise, as you can see, coming just about here, sends the Dow up 53 when it's been down over 200
earlier in the session. It came too late for the European bosses where you have very sharp losses with mining and oil shares the worst hit.
B.P. and Shell were down 3% in the London market. BHP and Angelo American they were down around 9%. As you can see the market goes right the way
down. Just take a look, bearing in mind the DAX was the worst of the day, off 2.5%. And you can see when you look at the six month to date, very
clear any time the market tries to get a footing or to rally, it's suddenly finding itself evaporating. And that's the way the Dow is over the one year
so far, quite sharply down.
(END VIDEO CLIP)
QUEST: Countries that rely economically on exporting oil are those at risk. That's the message from the IMF's Managing Director Christine Lagarde who
spoke to CNN only hours after Saudi Arabia said it would not cut its crude output.
Ms. Lagarde is urging countries like Nigeria, Venezuela and Brazil, to do more to protect their economies.
(BEGIN VIDEO CLIP)
CHRISTINE LAGARDE, IMF MANAGING DIRECT: Well I'm concerned about the impact that it is going to have on other countries, those that have just recently
mentioned which have been vastly oil dependent. Because with a statement like that and with the supply side, demand side effects that we can
anticipate, clearly prices are going to stay low, and for longer. Whether you look at the supply side effect, with more countries coming to the
market, with the input of Iran for instance, with added productions from countries that are relying on other extracting sources -- the supply side
is not going to go down. And those countries that were massive consumers of oil are reducing their consumption. China for one, which has not reduced so
far, but which will probably reduce in due course.
JOHN DEFTERIOS, CNN CORRESPONDENT: It leads me to ask, we had basically a corporate and sovereign debt crisis in 2008 and '09. Could we have an oil
led or commodity let crisis in 2015 and '16 that will be the shock to the global economy?
LAGARDE: First of all these economies, Nigeria, Brazil, Venezuela really have to take steps domestically in order to address the situation. And we
believe that they have ways to do that. For those that need support and help, including from international institutions such as the IMF, we stand
ready to help them.
DEFTERIOS: Aren't you concerned at the G20 at Shanghai that we are almost slipping into a recession right now because of the crisis we see in many
emerging markets with their currencies today and the lack of commodity revenues they are suffering through?
LAGARDE: You know on the global basis there is still growth. It's that new mediocre that have coined about a year ago, but there is still growth. Some
countries have seen a decline of about, you know, 70% of their currencies for some of them. And that floating currency that they had has operated as
a shock absorber in the circumstances they were facing. But beyond that, we believe that more coordination, an accelerated approach to the financing of
infrastructure projects around the world, would certainly be very necessary and legitimate to actually face the difficulties of some of these emerging
market economies, yes.
DEFTERIOS: There is a lot of concern about a "brexit" right now. Go beyond the short-term shocks to the British pound. Medium term either as the IMF
Managing Director or as a European, would it really be that bad for the U.K. to be out of the European Union? They don't even share the currency of
the Euro.
LAGARDE: Uncertainty is bad in and of itself. No economic player likes uncertainty. They don't invest. They don't hire. They don't make decisions
in times of uncertainty. So if you take one out, my -- my hunch -- my hunch, and that's really as a European and as a person that I will say
that, is that it is bound to be a negative on all fronts. For those who stay because there are fewer of them. And for those who go because they
lose the benefit of those facilitation of exchange.
[16:20:07]
QUEST: Christine Lagarde of the IMF talking to John Defterios, concerns over "brexit" pushed the pound down, and it continues to fall. Now looking
at February 22nd, you're up about 140 144 or so. By the time you get down to the end of today well you're down at 139. It's a seven-year low for
sterling and HSBC says the pound could fall up to 15, 20%. They're calling it the potential for a collapse. And HSBC in a report, in a note out this
morning saying GDP could be 1.5 percentage points lower next year as a result.
Stephanie Flanders is the chief market strategist for Britain and Europe at J.P. Morgan Asset Management. Stephanie, good to see you, thank you, much
appreciated. You believe all this talk of financial Armageddon is a little overdone?
STEPHANIE FLANDERS, CHIEF MARKET STRATEGIST, J.P. MORGAN ASSET MANAGEMENT: I say it is a little overdone but I do think that there is going to be
growing and continued uncertainty around the vote. And certainly if there was a surprise result, I think it could do a lot of damage to -- not just
the sort of short-term U.K. markets but medium term, those transition costs and the difficulties that Christine Lagarde was talking about -- I think -
I think they're all significant.
(BEGIN VIDEO CLIP)
FLANDERS: You know, very long term, we know that the U.K. is a strong economy by some measures the fifth biggest economy in the world. Its trade
is probably not - is not going to collapse with the E.U. it will still be probably successful in many ways. But all of the uncertainty and the
difficulties of that transition, you know, it certainly feels to me and I think to many people that you know can it -- are the potential benefits of
leaving the E.U. really so great that they justify that kind of upheaval?
(END VIDEO CLIP)
FLANDERS: And I certainly in my case I don't think that's the case. And I would also worry about certain sectors of the economy being hit quite hard,
like particularly in the services side where you might not get a very good deal when it comes to trade.
QUEST: The -- taking that on board, then, the reality is, since this referendum is going to take place on June 23rd and unless it appears that
one side or the stay inside gets a lead in the polls we've got four months of this sort of uncertainty and jitters in the market.
FLANDERS: I think we will see, you know continued uncertainty. It is interesting though because I think we are seeing -- the reason why we are
seeing it mainly on the pound and not on - you know when we've seen in the past in the times of the Eurozone crisis for example, you had governments
facing a big increase in their borrowing costs you know with their government yields going up.
(BEGIN VIDEO CLIP)
FLANDERS: You know, we haven't really seen that in the U.K. case because this isn't something which poses a question mark about you know the
government's ability to finance itself in international markets.
(END VIDEO CLIP)
FLANDERS: But I think -- so that is why you are seeing primarily this impact on the pound. But probably the U.K. came into the year with a
slightly overvalued or somewhat overvalued pound anyway. Remember we've got that massive current account deficit, Richard, you know there's long term
question marks about financing that. So I think there were probably reasons why the pound -- you know, there were justified reasons for the pound to go
down. But this is going beyond that.
QUEST: Those of us -- I was looking today at the numbers. And look, I'm just about old enough to remember the pound parity sort of in 1985. And I'm
also old enough to remember well in 2007 the pound two to one.
So it's not -- although it bobs around 150, 170, we're not seeing exceptional movements just yet.
FLANDERS: No. And I certainly can remember when it was up at two. And I think people who generally say when it was up at two that's usually a sign
that things are going to turn around and sure enough it did turn around then.
I think the more interesting thing we've seen Richard, is you saw around the time of the financial crisis that big fall, much bigger fall, as you
suggest, in the exchange rate. How much help did that really do for the real economy? You know, it was not clearly really for the first few years.
What you need to see is the demand side pickup from U.K. markets. So I think those people who say well the big fall in the pound would offset the
negatives that might come or the uncertainties that come from a vote to leave the E.U. I wouldn't be so sure about that if our trading
relationships are actually in question.
QUEST: Stephanie, we need you over the next few months to help us wend our merry way through the thicket of the possibility of "brexit." Thank you.
FLANDERS: Any time.
QUEST: It's been called Brazil's worst environmental disaster.
(BEGIN VIDEO CLIP)
QUEST: And now the police say they believe the deaths of 19 people in that industrial accident - they're now saying it amounts to a homicide. After
the break.
(END VIDEO CLIP)
(COMMERCIAL BREAK)
[16:26:30]
QUEST: Brazilian police have accused seven people of homicide in connection with the collapse of a dam at a mine in November.
(BEGIN VIDEO CLIP)
QUEST: You'll recall six of the people named are executives of the mine operator, Samarco including the company's former chief executives. 19
people died after the dam collapsed near the village of Bento Rodrigues.
CNN's Shasta Darlington is our correspondent in Rio.
SHASTA DARLINGTON, CNN CORRESPONDENT: According to police a tailings dam at the iron ore mine burst because it had been overfilled and was not
monitored properly. As a result they said the executives should be charged with qualified homicide and if found guilty could face up to 30 years in
prison.
Samarco, which is jointly owned by Brazil's Valley and Australia's BHP Billiton put out a statement calling the accusations misguided. The company
however said it would wait for a court decision on whether to formally bring criminal charges before taking any actions. Now that's a decision
expected any day now.
When the dam burst last November it unleashed a tidal wave of toxic mud and sludge in what has been called the worst environmental disaster in Brazil's
history. 19 were killed and hundreds were left homeless when the mudslide washed over a nearby village.
Samarco says it's still investigating what caused the accident but Brazil is already pushing for more controls and contingency plans at mining
operations. And Samarco is also already facing a flurry of lawsuits, including a $5 billion lawsuit filed by Brazil's Attorney General.
Shasta Darlington, CNN, Rio de Janeiro.
(END VIDEO CLIP)
QUEST: Apple's Chief Executive Tim Cook has until the end of the day, any time now, to accept an invitation to Capitol Hill.
(BEGIN VIDEO CLIP)
QUEST: A congressional committee wants him to testify in Apple's encryption battle with the FBI. You are going to hear from a congressman who is urging
the Feds to back down and believes this is not the right way forward. It's "Quest Means Business."
(END VIDEO CLIP)
(COMMERCIAL BREAK)
[16:30:00]
RICHARD QUEST, CNN ANCHOR: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment.
When the head of Airbus Tom Enders tells he's entertained by the 2016 race for the White House. That's one word for it.
And the founder of Def Jam Records tell us why he's holding an alternative to the Oscars. And for all of that this is CNN and on this network the
news will always come first.
Donald Trump says he likely pick a political insider to be his running mate if he won the Republican nomination for president. The billionaire
extended his lead in the Republican race on Tuesday with a resounding win in Nevada. Trump hailed the size of his victory as he continued his
campaign in the state of Virginia.
(BEGIN VIDEO CLIP)
DONALD TRUMP, U. S. REPUBLICAN PRESIDENTIAL CANDIDATE: And we had a very exciting evening last night and I went all around. You know the word
caucus is a little complicated, because you don't know how it's going to work out. And they say it's hard to poll, but we polled fine and we really
won big last night.
(END VIDEO CLIP)
QUEST: Meanwhile, the Democrat front-runner Hillary Clinton won a major indorsement from the top Democrat in the U.S. Senate. Minority Leader
Harry Reid has now endorsed the former Secretary of State's bid for a presidency. With an exclusive interview with CNN he says, "The middle
class will be better serviced by Clinton than by her rival Bernie Sanders.
All 23 people onboard a Nepalese passenger jet appear to be dead after the plane crashed in a mountainous region. No word so far from investigators
as to what may have caused the plane to crash during what should have been a 19 minute flight. The local police say most of the bodies found so far
were charred beyond recognition.
Hungary's Prime Minister says he will call a referendum over Europe's plan to impose migrant quotes on E.U. countries. Viktor Orban says the EU will
require Hungry to take a certain number of migrants would be in his words, "An abuse of power if it did not have the public's backing." The vote
won't be held until at least the third quarter of this year.
There's no word yet from Apple's Chief Executive Tim Cooke on whether he will head to Capitol Hill. He's been asked to testify -- along with the
FBI Directory James Comey -- before U.S. lawmakers, over his firm's encryption battle with the FBI. Now the battle and the deadline to accept
the offer is this Wednesday.
One of California's congressmen says, "The FBI's demands are unprecedented and harmful." He's Congressman Ted Lieu who says he disagrees with the
legal action being taken by the FBI, and he's written an open letter to the Director Comey saying, "Let's all take a deep breath and start talking to
each other instead of fighting in court." We're very honored to have Ted Lieu, who joins us now live from Washington. Congressman, thank you for
joining us. And sir, in this battle, in this disagreement, why do you think the FBI should not fulfill its legal obligation for public safety to
do what it can to get it was on that phone.
REP. TED LIEU, D-CALIFORNIA: Well thank you, Richard, for that question. I serve on active duty in the U.S. Air Force. I'm still in the reserves.
And when it comes to terrorist I believe we need to hunt them down and kill them. I also believe public safety is government's first priority and
that's why I agree with Apple in this case. Because there's not a single shred of evidence that forcing a private sector company to weaken
encryption would help U.S. national security. There's not a single terrorist case that the FBI can cite that shows that having a backdoor key
would have prevented the terrorist attack.
QUEST: Then of course there is an argument that you can't prove something until you actually been able to do it. And therefore you're trying to
prove a negative.
LIEU: Well that is one argument that could be made, but keep in mind that I'm not saying that there should not be a resolution to this issue. My
letter says that Congress and the American people should decide this issue. What the FBI is trying to do is to use a law passed in 1789 and have an
unelected judge decide this issue for America. That's not appropriate.
QUEST: Indeed your letter does say that difficult and challenging issues of liberty, safety and national security should not be decided by unelected
entities such as judges. But I wonder if the FBI needs the information now, and you know sir how long it can take. You can get married and
divorced before legislatures manage to get to grips with certain things. This is a major titanic battle over fundamental values isn't it?
[16:35:00] LIEU: Yes, it is a major titanic battle. And that's exactly why the American people and stakeholders and Congress, which is the
people's house, should address this issue. Because we're balancing privacy, security, civil liberties, national security. These are complex
issues that could forever alter a way of life. It should not be done by an unelected judge interpreting a law that was passed nearly 90 years before
Alexander Graham Bell invented the telephone.
QUEST: So assuming this does go into Congress. Where do you stand on that? I think you've already said that you were against having a backdoor,
environment key, super key, whatever we want to call it. But then sir, I ask you, what will you give law enforcement so that they can get access to
these phones when they're locked?
LIEU: Right. I support reasonable cooperation. Apple in this case has cooperated with the FBI. They sent their own engineers to help the FBI
unlock this phone. But when the FBI said, we now want you to create new software you don't have in order to weaken encryption, to me that is
coercive, it is beyond a pale, it is unprecedented. And the problem is it would affect not just this phone, but all iPhones across our nation and
harm the privacy of millions of Americans.
QUEST: Finally Congressman, would you accept that if the appeal courts rule against Apple that Tim Cook has no choice but to do that which they
require?
LIEU: Apple absolutely has to follow the law. I believe the law in this case should be decided by Congress, not by a 1789 statute that I think is
being wrongly interpreted.
QUEST: Congressman thank you so much, sir, for joining us. We appreciate you joining us from Capitol Hill tonight.
LIEU: Thank you.
QUEST: Your hearing all the views from the people who are making the decisions.
Now, Facebook is trying to boil down the full range of human emotions. You're familiar with the Like. Well they've gone for six icon or emotion
and they are call Reactions by the social network in which is launched at six Reactions. They are quick ways to express your feelings about a post,
a feeling, a picture, what somebody has added. While of course the first was the classic Like. We're all familiar with that.
But then we needed something more. Perhaps you needed a bit more Love, which is one of the new Reactions. The Beatles said, "That's all you
need." Facebook says "Like" and "Love" is not enough. You need something for a laugh, a comedy. Well now forget that. Instead of "LOL" you got the
"HaHa" icon. And when words fail you got the "Wow" option. "Wow", "HaHa", "Love", but life as you and I know only too well, life isn't all about fun
and games. You get those "Sad" moments. So the "Sad" reaction can be used for life's mishaps.
Facebook decided against the dislike button, because it simply said that was going to be misused. So if you're sad, and then you are suddenly
angry. Well Facebook has in "Angry" icon as well. What they didn't go for instead was a "Yay". They decided "Yay" just wasn't going to work, because
"Yay" was confusing, and so they axed it.
The Reactions as they are being called, and there are six of them. Like, Love, HaHa, Wow, Sad, Angry, it's all a result of a massive effort with
consultants, focus groups, and sociologists. In the VP of Growth told our Laurie Segal, this was a year in the making.
(BEGIN VIDEO CLIP)
ALEX SCHULTZ, FACEBOOK: It's our response to having a "Dislike" button. So is not a "Dislike" button. It allows you to show empathy. It offers
you not just a "Like" as a response, but you can show someone a "HaHa" if you really love something. There's a little "Sad" face if it's a sad
memory or you can show your support. We always knew if you launch a "Dislike" button it's going to feel really bad for people. Because
there'll be stuff that you post where people aren't being empathetic when they use "Dislike", were there actually being bullying or condescending or
bad.
Whereas this new product Reactions, which is a great partnership between product and engineering, but also research. Going out and talking to
people and understanding how they wanted to be responded to. And analytics, looking at all the one word responses that we got, and what are
those words. We produce something that I think is going to solve this problem in the long run.
(END VIDEO CLIP)
QUEST: I'm not so sure about not having a "Yay". I think we must have a yay.
[16:40:00] All right, Airbus has announced a profit rise for 2015, and a boost in production for this year. We're going to be talking to the chief
executive on the cheaper oil and the possibility of Brexit. It's Airbus ahead.
(COMMERCIAL BREAK)
QUEST: QUEST MEANS BUSINESS of the midweek addition. Airbus says it will step up production of their A-330 airline after reporting a rise in annual
profits. The chief executive of the group Tom Enders, says it was a solid performance from Airbus in 2015. Nina dos Santos asked him if he was
concerned that demand would drop for more efficient planes with fuel prices at their current low levels.
(BEGAN VIDEOTAPE)
TOM ENDERS, CEO, AIRBUS GROUP: Clearly we see no sign of that. I mean the level of cancellations, deferrals of deliveries that would be a strong
indicator that something bad is happening doesn't show it. I mean cancellations are like normal. We have a lot of conversions of older 320s
into new re-engine 320s for instance. No indication, but this really plays a major role. Because for all airlines to take new aircraft is not just
the fuel consumption, even though the oil price of $30, fuel consumption will be considered way down, but it's additional features like range and
capacity that can be these modern aircraft.
NINA DOS SANTOS, CNN MONEY EUROPE EDITOR: Let's talk about one particular thing that could be a bump along the road. It could be the U.K.'s exit
from the European Union. Now this is been dominating the business leaders' minds as far as I understand for the last few months. Where does Airbus
stand on this issue of Brexit?
ENDERS: Well Airbus has a clear stand. I'd like to say first, I think David Cameron has reached a good result last weekend. Good result for the
U.K. Good result for the European Union and now it's up to the British people to cast their vote in June. But I had a make no secret of our
sympathy that Britain should stay inside the European Union, because we have a very sizable workforce, very sizable production, R&D in Great
Britain.
DOS SANTOS: You do indeed, and how would you have to revise those facilities if the U.K. were to leave?
ENDERS: Well that would not happen over time obviously. I mean all of our aircraft wings are coming from Great Britain, but it is what the Prime
Minister called a leap into the dark. Leap into the unknown. What business people don't like, leaps into the unknown. And we don't know what
would follow from a Brexit. But one thing for me is certain it would not increase the effectiveness of our operations in the U.K., and the
competitiveness of our business here.
DOS SANTOS: A lot of people saying, oh so you're signing up to letters saying, it will cost people jobs in this country. Do you think that's a
view you subscribe to?
ENDERS: I think that's a very likely consequence at least over the mid- to longer-term, yes.
DOS SANTOS: Let's talk about other important markets. You've recently opened a facility in Alabama. We've got an electoral cycle in the United
States there as well. How do you envisage the 2016 rates for the White House effecting Airbus' business?
ENDERS: I don't think it will much affect our business. I'm not American. I'd rather stay away from what is a very entertaining race for president,
particularly on the Republican side in the U.S. Well listen we're proud to produce aircraft from now on in the United States in Alabama. We're doing
that in the U.S. because today the U.S. is the largest aeronautic market of the world. China on the other hand we're producing planes in China as
well. These are the two largest aeronautic markets and to have a strong industrial footprint in these markets cannot be a mistake.
[16:45:13] DOS SANTOS: There is a new market that is coming on line and you are the first to get into it, Iran. What are hoping for Iran?
ENDERS: Well, first of all I hope very much like I think not only business people but also politicians that Iran will develop in a positive way. I
think we are not over the hump so to say. This agreement that was reached, the implementation of the agreement by the Iranians was a very important
milestone. It's clear that Iran, a country with 80 million people with very well educated people, a lot of engineers, if it opens up economically
and politically should have a great future. It's clear that Iran needs new aircraft, additional aircraft, and I think the first order that we have
agreed with our memorandum of understanding is probably only the first slice of new aircraft that Iran would need.
QUEST: Tom Enders talking to our Europe Economics Editor, Nina Dos Santos.
Think about growth slowdown in China is one of the biggest reasons why crude oil prices have fallen and why prices for gasoline are also lower at
the pump. And there is one place where filling the tank isn't getting any cheaper though and it's China itself. And that is because the government
has put a floor on fuel prices and they haven't but budged in weeks. CNN's Matt Rivers has taken a ride with a Beijing cabbie.
(BEGIN VIDEO CLIP)
MATT RIVERS, CNN CORRESPONDENT: (voice-over) In Beijing a liter of fuel costs 5.56 Yuan about 85 U.S. cents. And while prices keep falling across
most of the world here in China gas as cheap as it is going to get.
LIEU JUNG GUO: (through translator) I'm jealous, very jealous.
RIVERS; (voice-over) Meet Lieu Jung Guo (ph), he's 52, has a wife, one daughter, she's in med school and that blue Buick is his chariot. He earns
a living driving people around. Which means lots of time spent here at the gas station. The government sets fuel prices. But despite the plunging
cost of oil, prices here haven't changed since mid-January. That's when Chinese officials set a price floor, when crude oil trades below $40 a
barrel prices a Chinese pumps freeze.
GUO: (through translator) It's China, the government sets the prices, when it's expensive you pay more, less when it's cheap. What can ordinary
people do about it?
RIVERS: (voice-over) Resignation and a bit of frustration from Mr. Lieu, a familiar sentiment from Chinese consumers wondering why their government
won't let them join in on the cheap oil party. Officially state media says it's for environmental reasons. Cheap gas would mean more people buying,
which means more pollution in a country where there's plenty of toxic smog already.
RIVERS: And there is likely another reason for this price floor, centering on a different kind of green, profits. They plummeted at the big Chinese
state owned oil companies last year because of cheap oil, many experts suggested this price floor is a way for the government to try and ease that
pain by not letting prices get too low. Whatever the reasons, Lieu Jung Guo says costs everywhere else in Beijing are going up, it would be nice if
fuel went down.
(LIEU JUNG GUO): (through translator) Everybody thinks the lower the better.
RIVERS: (voice-over) Then he'd have more money to reinvest in his car, maybe put towards his daughter's tuition, at the very least he'd have more
cash to spend on the chestnuts he likes to eat while driving around. Matt Rivers, CNN, Beijing.
QUEST: Now in a moment, why one American business magnate is throwing his own awards ceremony to rival the Oscars this weekend.
(COMMERCIAL BREAK)
[16:50:32] QUEST: The Academy Awards, the Oscars are to be handed out this weekend and this year's there's been more talk of about who wasn't
nominated. Namely nonwhite actors and those are actually on the nominee list. That's why Russell Simmons the cofounder of hip hop label Def Jam is
staging a rival awards ceremony. They'll have a black carpet and there will be black artists and they'll be the ones in the spotlight. CNN
Money's Maggie Lake was talking to Mr. Simmons about it and he started by praising the actress Jada Pinkett Smith, one of the early critics of this
year's Oscars.
RUSSELL SIMMONS, FOUNDER AND CHAIRMAN, ALL DEF DIGITAL: I think that Jada's statements were helpful because they created a dialogue, a vacuum, a
place for me to promote a fun way to celebrate diversity and celebrate people who might not otherwise get celebrated.
(BEGIN VIDEO CLIP)
MAGGIE LAKE, CNN MONEY ANCHOR/CORRESPONDENT: (voice-over) Launched as a fun spirited response to the diversity controversy Simmons movie award show
was originally planned as a digital program only. Now Fusion Cable Network has inked a deal to broadcast this special the same night as the Oscars.
SIMMONS: So you need all kinds. I'm an insider. I have a First Look deal at HBO. I don't feel left out, but I never pitched to an African American
in my life who can press a button. I've never had the opportunity --
LAKE: How do you get people in that position?
SIMMONS: And there are some cultural things that I want to do, that I just can't explain to people who don't understand the culture as well as some
African Americans might.
LAKE: So what needs to happen to get people in that position of power, to be able to green light the things you want to do, to push the button.
SIMMONS: Well, it really is a communications business and African Americans have to communicate more and push more. And I think it's
beholding on the senior people, the people to run the studios, to look for people who are cultural and have insight. And could make their company
more successful to include, so it is a little of both, right.
We found out from our research at All Def Digital on our consumers, they like integration. They find integration to be fascinating, it's
aspirational, it's inspiring. So integration is important not only on the screen, because when you do it only on the screen then you may make
mistakes if you don't have people behind the camera who understand the dynamics. So you need to have an inclusive group in the senior levels of a
studio, of a network. That's what we need. So that's kind of the impetus behind making this show.
LAKE: I want to ask you about is digital and those outlets a way to sort of leapfrog as you build up that infrastructure. Is that a direction for
young African Americans, for women to sort of bust through the Hollywood glass ceiling?
SIMMONS: Women, Asians, Latinos and others can rejoice at micro-budget opportunities to reach broader audiences because then it's like music.
When I made Nutty Professor I put Jay Z's "There ain't no "N word" like the one I got," as the first song that was his first record, right. No one
would have chosen that but I was there, so I was hep.
But the real truth is whether they chose it or not music reaches the people. It's inexpensive, and the people make the choices and they are
much more open. That's why the Grammy's and music in general is much more open to integration. And Hollywood where the stakes are higher, and where
everybody is afraid to press the button. You need people who have confidence in culture, who understand culture, to be part of the process.
QUEST: Maggie Lake talking to Russell Simmons, we'll have a profitable moment after the break.
[16:55:00] (COMMERCIAL BREAK)
QUEST: Tonight's Profitable Moment. Well, there are motives that have got every possible shape, form and description, every facial recognition, every
anger or happiness you can imagine, and now Facebook has decided it needed to do more than just having the traditional "Like". Facebook has given us
it's new what they are calling Reactions. So you have Like, Love, HaHa, Wow, Sad and Angry.
But I don't know whether I fully understand the purpose of these. Have we now reached a point in our society where we are so bereft of language and
ability to express ourselves that we have to resort to these little diagrams to explain some of our most fundamental emotions? Oh, I'm not
talking about writing a Shakespearean sonnet or a love letter or a poem, I'm just talking about the ability to say what you mean in clear, simple
language.
Or do we have to have a HaHa, and if you are going to have to have a HaHa, you can't have a dislike. And why can't we have a dislike, because that
might be a little too nasty. Well, I think just stick to good old fashioned writing. And that's Quest Means business for tonight, I'm
Richard Quest, haha, in New York whatever you are up to the hours ahead, I hope it's profitable. We'll do it again tomorrow.
END
