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Quest Means Business
Donald Trump Fires Money Man; Turkish PM Steps Down; Wildfires Out of Control in Alberta, Canada; Venezuela Crisis is Causing Blackouts and Shortages; Hospitals Suffer Amid Venezuela's crisis; Puerto Rico Struggles with Debt Crisis; Padilla Says We Are Not Asking for a Bailout; Puerto Rico is Doing Their Best to Meet Payments; Political, Economic Upheaval in Australia; Low Inflation Forces Australian Interest Rate Cut; U.S. to Regulate E-Cigarettes. Aired 4-5p ET
Aired May 05, 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]
MAGGIE LAKE, HOST: U.S. Markets are flirting with a third straight day of losses. It's going down to the wire as trading comes to an end. It's
Thursday, the 5th of May.
(BEGIN VIDEO CLIP)
LAKE: Tonight, Donald Trump finds his money man, a huge fund boss will run his campaign finances. Turkey's Prime Minister quits sending markets
reeling. And when an economic crisis becomes a humanitarian one. We'll take you inside Venezuela's crumbling hospitals.
(END VIDEO CLIP)
LAKE: I'm Maggie Lake. This is "Quest Means Business."
Good evening. Tonight Donald Trump is building his political machine as he prepares for a brutal general election campaign and he already faces
opposition within his own party.
(BEGIN VIDEO CLIP)
LAKE: Trump named Steve Manuchan as the financial chairman of his presidential campaign Thursday. The hedge fund manager will be tasked with
bringing in money for a campaign that so far has been largely self-funded.
Several former Republican nominees have said they will skip the convention including George W. Bush, Mitt Romney and John McCain.
Paul Ryan has just spoken to Jake Tapper about his support for Donald Trump. You can see that interview later this hour.
(END VIDEO CLIP)
LAKE: You know, it's not only party elites dubious in the business world we are hearing from executives who say they, too, are concerned. Earlier I
spoke with Steve Joyce, the CEO of Choice Hotels who said it's crucial that the U.S. remains an inviting country.
(BEGIN VIDEO CLIP)
STEVE JOYCE, CEO, CHOICE HOTELS: The economy is a global economy, travel is of international business. If we start not welcoming visitors, we're
going to lose lots of revenue, lots of taxes. And guess what the Europeans will welcome, the other countries welcome them. We've lost a lot of our
market share as it stands. We can't afford to have anyone suggesting that people are not welcome.
Now we need secure borders there no question but when you start saying we don't want this population or we're not happy with Visa waiver, that's not
good for the economy and the security of the United States. And so we need Presidents that will support travel, create a safe country obviously, but
also, be aware this it's a global economy and we've got to welcome them.
(END VIDEO CLIP)
LAKE: Mark Preston is CNN political executive editor and he joins us now. Mark, you can sort of feel the struggle that so many in the Republican
Party are having. We have business leaders expressing their concern about trade, fund raising concerns. Where is Donald Trump? Is this a process
that's going to work through or could we see, is this the beginning of a bigger rift within the Republican Party in.
MARK PRESTON, CNN POLITICAL EXECUTIVE EDITOR: Well, certainly, the Republican Party is split among many different lines here in the United
States, Maggie, but when it comes to Donald Trump he has opened up a new rift.
(BEGIN VIDEO CLIP)
PRESTON: You have those who believe that Donald Trump is going to be the presumptive nominee so they should get behind him. And then you have those
who say for the good of the party we should abandon him, as well. And a lot of that has to with this very harsh rhetoric that is causing business
leaders here in the U.S. as well as world leaders to have some concern about Donald Trump. Not only what he is but how he's saying it.
LAKE: And concern about what it means for the other elections.
(END VIDEO CLIP)
LAKE: I mean this is about the Presidential election but it's also framing what Republicans stand for.
That's a problem for some depending on what state you're in and given the amount of discourse we have on record from the nasty primary race. I mean
is he going to be able to backtrack or pivot when we have so many comments like that?
PRESTON: Well, one of the problems for Donald Trump and certainly for business leaders as we've just heard is that Donald Trump will say
something, will say one thing and then he'll backtrack.
(BEGIN VIDEO CLIP)
PRESTON: There's a big unpredictability about him. Just look at the federal minimum wage here in the United States, it's $7.25. Donald Trump about six
or seven months ago said he doesn't think it should be raised. And then he just said on CNN yesterday that he is different than other Republicans and
that he does think it should be raised.
(END VIDEO CLIP)
PRESTON: To your point, we do have a divided government here in the U.S., Maggie as you well know. We have the House, we have the Senate, we have the
Presidency and we have the Supreme Court. Those members, those Republicans who are running for re-election in the House and the Senate are concerned
about being connected to Donald Trump and being dragged down should he not do very well in November.
LAKE: That's right and that is why it is so important we are going to hear from this next man.
Paul Ryan has just been speaking to CNN's Jake Tapper about Trump's nomination. Let's take a listen.
(BEGIN VIDEO CLIP)
JAKE TAPPER, CNN ANCHOR: And joining me now, the speaker of the House of Representatives, former Republican Vice Presidential nominee, Paul Ryan.
Speaker Ryan, thanks so much for joining us.
REP. PAUL RYAN (R-WI), SPEAKER OF THE HOUSE: Thanks for having me, Jake. How are you doing today?
TAPPER: So Mr. Speaker, you have said throughout this process that you will support the Republican presidential nominee. Now you have a presumptive
nominee, Donald Trump. Will you support him?
[16:05:00]
RYAN: Well, to be perfectly candid with you, Jake, I'm just not ready to do that at this point. I'm not there right now, and I hope to though and I
want to but I think what is required is that we unify this party. And I think the bulk of the burden on unifying the party will have to come from
our presumptive nominee.
I don't want to underplay what he accomplished. He needs to be congratulated for an enormous accomplishment for winning now a plurality of
delegates and he's on his way to winning a majority of delegates. But he also inherits something very special that's very special to a lot of us.
This is the party of Lincoln, of Reagan, of Jack Kemp and we don't always nominate a Lincoln and a Reagan every four years but we hope our nominee as
far as to be Lincoln and Reagan-esque, but that person advances the principles of our party and appeals to a wide vast majority of Americans.
And so I think what is necessary to make this work, for this to unify, is to actually take our principles and advance them. And that's what we want
to see, saying we're unified doesn't in and of itself unify us but actually taking the principles that we all believe in, showing that there's a
dedication to those and running a principle campaign that Republicans can be proud about and that can actually appeal to a majority of Americans that
to me is what it takes to unify this party.
TAPPER: So you're saying you can't -- you can't support or endorse him right now?
RYAN: Yes I am basically saying that. Look, I'm -- that's -- you know, I thought about this two days ago. I thought, actually, this thing was going
to June 7 at the very least. Probably to a convention. And so this is all pretty new for us. But at this point I think he needs to do more to unify
the party, to bring the wings of the Republican Party together and then to go forward and to appeal to all Americans, and every walk of life, every
background, a majority of independents and discerning Democrats.
And so, you know, I think conservatives want to know, does he share our values and our principles on limited government, the proper role of the
executive, adherence to the constitution? There are lots of questions that conservatives I think are going to want answers to, myself included. And I
want to be a part of this unifying process, I want to help unify this party but we have to unify it I think for us to be successful. For us to have a
campaign Republicans are proud of going forward that is unifiable and that actually can go and appeal to a vast majority of Americans.
TAPPER: Well, Mr. Speaker, you're casting this in characteristically optimistic and positive terms and I would expect no less from you. But what
you're saying is a fairly dramatic announcement that the Speaker of the House cannot as of now support his party's nominee for President. Is there
something specific he has done or said that has brought you to this moment?
RYAN: Well, like I said, I hope to support our nominee. I hope to support his candidacy fully. And I want to do that. But right now, I just got to
tell you, Jake, just being candid with you, at this point I'm just not there right now. And it's because I think of part of the last campaign, I
don't want to go back and roll the tape.
Look I was pretty clear and I was outspoken on a number of occasions where I think that he did the wrong thing or said the wrong thing. And I'll do
that if need be, I hope it's not necessary. But I think what a lot of Republicans want to see is that we have a standard bearer that bears our
standards and that unifies all the wings of the Republican Party which we all come from different wings of our party but we all agree on a common
platform of conservative principles.
We want somebody who takes these conservative principles, applies them to the problems and applies solutions that the vast majority of Americans can
vote for, that they want to be enthusiastic about. That is what I think it takes to unify the party, that I think there's work that needs to be done
in order to unify the party. I think our nominee, our presumptive nominee needs to do that. I want to be part of helping him do that.
But right now, no. I think that you know, there's some work to do here. Let me say it this way. Republicans have been watching each other go after each
other for six months. Democrats are doing the same thing because we've had a primary, a bitter primary process. And I think we sometimes forget just
how successful we've been.
We have the biggest house majority since 1928. We have 54 Republican senate seats. We have state legislative majorities in governorships that we
haven't seen in years, in decades. And so we've done extremely well. Our party is having enjoying success because we have unified around common
conservative principles. And we have one more hill to climb. One more mountaintop, that's the presidency.
So please know that we think the stakes are extremely high. They're highest that they have been. The Supreme Court, Congress, the future of America is
on the line and no Republican should ever think about supporting Hillary Clinton, let me make that clear.
But for us to be a successful party, to climb that final hill and win the presidency we will need a standard bearer that can unify all Republicans,
all conservatives, all wings of our party and then go to the country with an appealing agenda that can be appealing to independents and disaffected
Democrats. And we have work to do on this front and I think our nominee has to lead in that effort.
[16:10:11]
TAPPER: As you know, Mitt Romney, John McCain, George W. Bush, George H.W. Bush, all of them, Republican presidential nominees or Presidents, have
said they're not going to go to the convention in Cleveland. In fact, I want to get your view, watch this clip of your former running mate Mitt
Romney talking about Donald Trump earlier this year.
(BEGIN VIDEO CLIP)
MITT ROMNEY, FMR. GOVERNOR OF MASSACHUSETTES: Think of Donald Trump's personal qualities. The bullying. The greed. The showing off. The
(inaudible). The absurd third grade theatrics. Donald Trump is a phony, a fraud. His promises are as worthless as a degree from Trump University.
He's playing the members of the American public for suckers. He gets a free ride to the White House and all we get is a lousy hat.
(END VIDEO CLIP)
TAPPER: Do you share governor Romney's views? Trump's a phony, a bully and a fraud?
RYAN: Look, here's what I think Jake, and I think you're going to see tapes like that running all fall. The question is, can our presumptive nominee
turn things around, unify and have a different kind of cadence going forward? The way I look at this, Jake is it's time to go from tapping into
anger to channeling that anger into solutions. It's time to set aside bullying, to set aside belittlement and appeal to higher aspirations,
appeal to what is good in us and lead a country and a party to having a vast majority of Americans enthusiastic about choosing a path.
That's why I just feel so strongly about the chance and the choice and the opportunity we have in front of us but for this to work our presumptive
nominee I believe needs to unify the party for the party to be unified. And I want to help him do that --
TAPPER: Do you think that's possible? Do you think that's possible?
RYAN: But we're not - just so you know Jake, we're not there right now. We're not there right now. Yes, I think it's possible but we're not there
right now. And I think it is possible and better get on with it. But I think we just need to be honest with each ore other about these things.
And look, I think, yes, I think we can beat Hillary Clinton. Are you kidding me? So yes, I think it's possible and it needs to be possible
because so much is at stake.
TAPPER: So you don't think -- you don't think the damage is done?
RYAN: But work needs to be done, and I think our presumptive nominee has of work to do.
TAPPER: You don't think that -
RYAN: I didn't catch that. Say it again.
TAPPER: You don't think that so much damage has been done that it's almost as if it's a lost cause? Because it seems to me from hearing people like
Mitt Romney, hearing Ted Cruz the other day, call Donald Trump a pathological liar on the eve of Donald Trump winning it all, Donald Trump
was attacking his father and suggesting that Raphael Cruz might have played a role in the Kennedy assassination. It doesn't seem like there are going
to be -- it's going to be possible to build that many bridges. You disagree?
RYAN: I'm familiar with the points you're making. That is why among other reasons, basically, as a conservative, I want to see a verification that
our conservative principles will be championed, will be run on, will be represented. And will be brought to the public and the country in a way
that's appealing for us to be successful.
So, like i said, we're not there yet. But yes, I mean look this man is going to get the nomination because he earned it. He deserved it, he won
the vote. And more importantly, I think those of us need to learn a few lessons here. I think there's a bit of humility that each of us need
especially leaders in congress which is, he tapped into something in this country that was very powerful. And people are sending a message to
Washington that we need to learn from and listen to. But at the same time now that we have a presumptive nominee who is going to be our standard
bearer, I think it's very important that there's a demonstration that our standards will be bared.
I mean that - it will advance our appreciation for limited government, for the constitution, for the proper role of the executive, for the principles,
not only that built our party but built this country and how we are going to apply those principles to offer solutions and run a campaign that
Republicans that can be proud of and run a campaign that Americans can be proud of. And yes, , looking back on the primary campaign I think there are
instance and episodes that question that. That's why I at this point am not ready to jump in. But I hope we can get there. And that's my goal.
(END VIDEO CLIP)
LAKE: U.S. Speaker of the House Paul Ryan speaking to our Jake Tapper there.
Mark Preston joins me again. Mark, as you pointed out to me and as Jake pointed out to Paul Ryan, it's extraordinary that we are seeing the Speaker
of the House of his own party not able to say that he's willing to support Donald Trump.
I want the pick up something that Paul Ryan said just at the end, though, which is the thing that keeps jumping out at me. They're clearly so upset
about this in Republican circles and having such a hard time coming to terms with it and saying he has to come to us, he's got to convince us.
What's left out of this is the voters. The voters are enthusiastic. They overwhelmingly rejected the standard put up by the Republicans in congress
and the 17 or 18 other people on that stage with Donald Trump. There wasn't one other guy running with him, there was an entire spectrum of Republicans
up there and they rejected them for Donald Trump. This seems to be lost in this conversation among Republicans and the establishment.
[16:15:10]
PRESTON: Right. Well a couple of things Maggie. One is this who campaign has been about moments. Very important moments, there's been an incredible
amount of white noise. Ok? That was a moment. So if you're watching right now, that is a historic moment to have the sitting House Speaker Republican
come out and not back his presumptive nominee. Ok?
(BEGIN VIDEO CLIP)
PRESTON: That is an amazing moment. No doubt about that. Now to your point about the fact that the voters have clearly, have put Donald Trump in this
position, plurality, he's been a plurality candidate in the sense that there were so many candidates running that Donald Trump until the very end
was not breaking 50%. He was getting about a third of the Republican voters. Having said that to your point, that was still enough to win in a
Republican primary and Donald Trump who we never thought would ever be in this position let alone I don't think he did, he won in the northeast of
the United States. He won in the south of the United States. He won in the Mid-west of the United States. And he won out West. Those are geographic
regions that have nothing to do with one another, other than the fact of a nationality.
So Donald Trump clearly has been able to tap in to some angst and anger with voters here in the United States, specifically on the economy.
(END VIDEO CLIP)
LAKE: And I think that's something that in my hearing all these Republicans react to, they have not come to terms with.
PRESTON: Right.
LAKE: They do lead in congress. They are the party in control of congress. And they are still having someone that they clearly privately loathe and
are having a hard time coming around to accepting.
I want to ask you when Donald Trump does from here. Because he has got to be watching this moment, as well, shaking his head, you know, thinking this
is -- he's got to stand up and try to unite. He's combative. This is probably very upsetting to him and his ego. Can he do that? Do you think he
can reach across and convince his other Republicans, donors and those unsure American people that he has the stuff to make a President?
PRESTON: Right. So it's become presidential. What does he want to do right now and what should he do right?
LAKE: He wants to bash everybody probably.
PRESTON: Right, I mean what he wants to do is --
LAKE: Tweet something about it.
PRESTON: Tweet whether to stay with us here at CNN, we'll tell you exactly you know when he does that. Or what he should do is become presidential and
take a tee off of Paul Ryan and talk about unifying the party and talk about how he agrees with Ryan that it is a fractured Republican Party and
everyone needs to come together, including the 16 others that ran against him and all of those who had bad things to say about him.
He could actually use this as a moment for himself to put other Republicans in the corner to support his candidacy. Now whether he does that or not, I
don't know. I would say betting odds are 50-50 on this one.
LAKE: Well he has told us that he is a deal maker, he is a closer and he works the back room so we're going to get an opportunity to see whether he
can deliver on that within his own party. Make (inaudible) thank you so much for being here.
PRESTON: Thanks Maggie.
LAKE: Mark Preston.
Now Turkey's Prime Minister has announced he will step down and that could have ramifications for the migrant crisis and the campaign against ISIS.
(BEGIN VIDEO CLIP)
(END VIDEO CLIP)
(COMMERCIAL BREAK)
[16:20:15]
LAKE: There are big changes ahead in Turkish politics.
(BEGIN VIDEO CLIP)
LAKE: Prime Minister Ahmet Davutoglu has announced he will step down from his position later this month. It comes amid reports of a rift with the
President Recep Tayyip Erdogan.
Turkish stocks and the Lira plunged on the news before bouncing back somewhat after announcing his resignation, the Prime Minister said Turkey
needs stability.
AHMET DAVUTOGLU, TURKISH PRIME MINISTER: (As translated) The congress should be held in unity and solidarity. There should not be any arguments
because the faith of the AK party is the faith of Turkey and the faith of the new world.
(END VIDEO CLIP)
LAKE: Turkey's strategic position gives it outsized importance on the world stage. At this moment, three big issues are putting the government under
pressure. First, rise in political tensions, the President is under fire for trying to tighten his grip on power and clamp down on descent. His plan
to move Turkey to a presidential system appears to have been the last straw for the Prime Minister. The President is expected to replace Davutoglu with
a Prime Minister who will support the changes he wants to make.
Second, the migrant crisis. Turkey is hosting more than 2 million refugees from Syria. Under a deal the Prime Minister negotiated with the E.U. Turkey
agreed to take back migrants from Europe in exchange Turkey's citizens get the right to travel to Europe without a visa.
Finally, the fight against ISIS. Turkish forces have traded fire with ISIS fighters and Turkey is a crucial ally for the U.S. which has troops and
aircraft stationed at Turkish bases.
Ian Bremmer is the President of the Eurasia Group, a political risk consultancy. He told me the deal between the E.U. and Turkey looked
unlikely to work and is now almost certainly dead.
(BEGIN VIDEO CLIP)
IAN BREMMER, PRESIDENT, EURASIA GROUP: It's going to be incredibly difficult to paper over differences. You know Erdogan is the guy keep in
mind that shot down the Russian plane, he blusters a lot. He's not apologetic in any way about the statements he makes which are sometimes
intemperate. And he certainly doesn't have a lot of love lost for the Europeans who he thinks have treated the Turks with a lot of disdain and
certainly not with a quality.
I think that this deal is more likely to fall apart more quickly as a consequence and that means that the refugee crisis is likely to pick up
more significantly in continental Europe over the course of the year. Not good news.
And in terms of Syria, the United States tries to rely on Turkey as a NATO ally in coordinating the fight in Syria. Now, even Davutoglu (inaudible)
it's been a very difficult relationship. Turkey much more focused on fighting the Kurds in Syria than they are in fighting ISIS. That's only
going to grow. Those differences are more challenging.
So whether as a partner of Angela Merkel or as a NATO ally to the United States, this sudden change is going to throw a spanner in those key
relationships. But you know what? Erdogan doesn't care. His view is my government domestically, my personal stability, my personal power is a lot
more important than the concerns of the Europeans or the Americans.
LAKE: And what about investors? Do they care if those relationships continue to splinter?
BREMMER: They certainly do. And the markets in Turkey have already taken a tumble on this news. I mean, the idea -- if Erdogan had the path to truly
consolidate power, if he could be a Putin or a Xi Jinping type figure in Turkey, than the markets might shrug it off and say we can deal with an
authoritarian.
But Turkey is not Russia and while long term that's good in the sense that you actually have much more healthy civil society, you do have, you know,
sort of a strong political institutions including even governance of the AK party itself, Erdogan's party, it's going to get a lot more challenging
before it gets better.
LAKE: And can you repair an economy and get it growing again facing those challenges while you are spending so much of your political will and
resources keeping that wall up and trying to keep a grip on power?
BREMMER: Look. It's going to be very difficult. I mean, this is a country right now that is hosting and paying for over 2.5 million refugees. They're
skirmishing and fighting in terms of the great instability they face on their border with Syria and they're also Erdogan is fighting political
battles on every front. None of those things allow him to prioritize true economic reform.
So could you see some populism, you know could you see some short term palliatives that put cash in the hands of the citizens especially if we see
a near-term snap election called by Erdogan? The answer is, yes. But is that the kind of thing that's going to make the markets happy or that's
going to lead to long-term sustainable growth in the Turkish economy? Is answer is absolutely no.
(END VIDEO CLIP)
[16:25:20]
LAKE: The crisis in Venezuela hits the most vulnerable.
(BEGIN VIDEO CLIP)
LAKE: For hospitals that means severe shortages of medical supplies leaving many patients in defense of themselves. Doctors speak out, next.
(END VIDEO CLIP)
(COMMERCIAL BREAK)
LAKE: Hello. I'm Maggie Lake. Coming up on the next half hour of "Quest Means Business" I'll speak to the Governor of Puerto Rico as the U.S.
territory looks for help from Washington to fix the debt crisis. And the United States isn't the only country with an election coming up. I'll be
speaking live to Australia's finance minister. Before that, these are the top news headlines we're following for you this hour.
(BEGIN VIDEO CLIP)
LAKE: The Republican Speaker of the House, Paul Ryan told CNN he is not ready to support Donald Trump in the race for the White House. The former
vice presidential candidate says Trump has work to do to unify the Republican Party. Still, Ryan acknowledged that Trump earned the
nomination.
The Prime Minister of Turkey says he'll be leaving office. Ahmet Davutoglu announced that he won't run for another term as the leader of the ruling AK
party. He down played rumors of a rift between himself and the President - the country's President Recep Tayyip Erdogan.
DAVUTOGLU: (As translated) I did not negotiate with anyone. I do not have a vision of calculations on a position based upon the negotiation of the
values and the principles I believe in. Your companion comes before the path. I want to be sure that my friends and I set off of a path together
shoulder to shoulder and when we're not together I would want them to tell me.
LAKE: At least 28 people have been killed at a refugee camp in Syria after air strikes carried out by unidentified war planes. That is according to
the Syrian Observatory for Human Rights which said many of the dead were women and children. The attack happened at a refugee camp in Idlib Province
close to the Turkish border.
Authorities in Canada say wildfires have destroyed 85,000 hectares across the city of Fort McMurray. Nearly 50 fires are burning. Firefighters say 7
of them are out of control. Authorities have ordered nearly 90,000 people to get out of the city. The Premier of the Province of Alberta says the
government will help anyone who needs assistance.
(BEGIN VIDEO CLIP)
[16:30:02] RACHEL NOTLEY, PREMIER OF ALBERTA, CANADA: To those people who have been displaced from their homes I want you to know that we have our
back. You will be supported. We have a very difficult road ahead with a lot of uncertainty as these fires continue to burn, but whatever road we
face we will face them together with the support of all citizens across this province.
(END VIDEO CLIP)
LAKE: Four people have been rescued from the rubble in Nairobi six days after a building collapsed in the Kenyan capital. Three women and a man
were found alive. Around 70 people are still missing according to the Kenyan Red Cross. At least 33 people were killed in the collapse.
The Speaker of Brazil's Lower House of Congress has been suspended for allegedly intimidating lawmakers. Eduardo Cunha, has led the charge to
impeach President Dilma Rousseff. Now a Supreme Court justice has accused him of obstructing investigations into corruption.
A new poll shows just one in four people in crisis-stricken Venezuela approve of the job the President Nicholas Maduro is doing. Repeated power
blackouts are just one problem people are having to endure. Then there's rampant inflation as well as severe shortages of food and other essentials.
Perhaps even more serious, medicines and the most basic hospital supplies are also in short supply. CNN's Paula Newton is one of the few foreign
journalists in Caracas and joins us now. Paula, we have heard for some time that Venezuela was nearing a tipping point, that this was a crisis
that was moving from a political crisis to a humanitarian crisis. I think that there's nowhere that's playing out more than the hospitals you have
seen.
PAULA NEWTON, CNN CORRESPONDENT: Yes, and nowhere that it's affecting Venezuelans more. When you think about the fact that the Federation of
Pharmacists here says that it lacks more than 80 percent of the medicine this country needs, you really see that statistic reflected in what doctors
just told me told me, and that the last month here, they have seen what was already a crisis deepen severely. Take a look.
(BEGIN VIDEOTAPE)
NEWTON (voice-over): You are about to get a rare look inside one of Venezuela's largest public hospitals. A searing view of the catastrophic
conditions stalking patients the moment they step inside. The true state of these hospitals is contentious. The doctors granted us access because
they want you to witness just a fraction of the suffering and indignity their patients endure every day.
NEWTON (on camera): We are just following the doctor here and working here. He's so fed up with the conditions he's allowed to us let us in
here.
NEWTON (voice-over): as we rush through corridors, the doctor details the long list of shortages. Medicines of all kinds. Syringes. Saline
solution, IVs, gurneys, even cleaning and sterilization supplies. And then, he takes us to meet Jose Luis Vasquez.
"I was shot so they could steal my bike," he recounts. "The bullet came in and came out the other side." And then he goes on to say there is only a
makeshift drain for his lungs. The hospital has no gauze, no needles and he had to buy this himself. And then he shows us where he keeps his money.
Counting out the cost of his needle, the equivalent of $10 he can't afford.
Next door, we gather to meet Winifred Mesa, just 21, with a horrifying tumor on the neck, she clearly in pain. Her mother tells us they'd have
been waiting for the operation, but it was canceled today. No medical supplies. Winifred lies waiting in a hot room, bringing her own sheets and
drinking water in a hospital that is crumbling, no working toilets or showers.
NEWTON (on camera): Dr. Ronnie here is telling us that throughout the entire hospital you will have scenes like this. The infrastructure's
absolutely crumbling and falling apart. There are leaks everywhere. The water doesn't work.
NEWTON (voice-over): Then, he shows us a wing which was supposed to open months ago.
NEWTON (on camera): So these are operating rooms that were rated by the government just last year and the doctor said he's never seen any equipment
in here and they have never been used.
NEWTON (voice-over): We find Luis Euvalgo (ph) in the corridors. 40 days in hospital still waiting for surgery. In the meantime, he, too, buys his
own medicine he says, and he's even had it stolen inside the hospital.
[16:35:00] Behind closed doors the doctors vent their frustration. Not over their salaries at barely $30 a month but what they now describe as a
humanitarian crisis not yet acknowledged. "We used to have operating rooms working 24 hours a day," she points out. "The surgeons would work a lot.
This was an elite hospital. Still, I want to know why the Dr. Ronnie Wood Ronnie risks a career speaking out." He answers that, "Supposedly there is
still democracy and free speech here. "It's part of my job," he says. "It's part of my commitment to the patients and we have to raise our
voices."
UNIDENTIFIED MALE: You don't see that things aren't getting better.
DR. JAVIER RODRIGUES, SURGEON: Just getting worse.
NEWTON: Have you had cases of people dying?
JAVIER: Yes, of course. Of course.
NEWTON (voice-over): Places of healing rendered horrific by years of unending financial misery. Here, you find the human cost of Venezuela's
deepening crisis.
(END VIDEOTAPE)
And when's important to note here, Maggie, showing you is not an isolated incident. This is happening in hospitals and clinics all over this
country. Just today here in Caracas, there was another protest by medical professionals. Everyone becoming increasingly alarmed at how quickly this
is getting out of control. Maggie.
LAKE: Paula, as you have been at pains to point out to us, this week, through all of your reporting there, this is a country that is sitting on
enormous natural resources. One of the largest proven reserves of oil in the world. Is there nothing that the government can do?
NEWTON: Not right now. Because they have mismanaged the situation. Maggie, as you and I follow very closely, oil production for the country is
key. Most of the revenues from oil production. Oil production is really at an all-time low now. It's been dropping steadily for about the last six
or seven years. That means they'll get less foreign currency into the coffers. And in terms of them sitting on the oil resources, you know what,
Maggie, they're sitting on a lot of human resources, as well. I have to commend the health professionals we have seen here over the years and this
week here in Venezuela. Really heroic actions to try and keep these hospitals, these clinics on the go.
LAKE: They're clearly doing everything they can. But they need help. Paula Newton, giving us a rare look at what's happening on the ground in
Venezuela, thank you Paula.
There's fears of a humanitarian crisis could reach Puerto Rico as the U.S. territory struggles with a debt crisis. Hospitals are already having
issues. Doctors are leaving the island at a rate of at least one a day. Mostly heading to the lucrative jobs in the U.S. and last week health
officials reported the first death blamed on the Zika virus. Joining us now from San Juan is the governor of Puerto Rico, Alejandro Garcia Padillo.
Governor, thank you for being with us today. First of all, give us an indication of what is happening there, what are conditions like on the
ground for the Puerto Rican people?
ALEJANDRO GARCIA PADILLO, GOVERNOR, PUERTO RICO: Thank you, thank you for having me. First of all, as everybody knows, Puerto Rico has now an
unsustainable amount of debt, since 2006 to 2012. Puerto Rico doubled its debt and now it's reaching the humanitarian proportion, the crisis. We
have been struggling to pay this year, the special attention to kids with special needs and therapies. We haven't been able to pay the contractor
that clean up and empty the septic tanks in school, public schools. We haven't been able to pay the full amount to bus driver that takes kids to
public school. We're struggling to pay the contractor that supply fuel to patrol cars and to fire trucks. So what -- I just want to point out
something very, very clear. Puerto Rico is not asking and haven't been offered a bailout.
LAKE: Yes, I want to jump in because I know this is an issue that is a very sore point of contention with you and stemming from comments made from
the presidential candidate, Republican presidential candidate Donald Trump who on our air yesterday speaking to Wolf Blitzer talked about the Puerto
Rican situation. I just want you to listen to what he had to say.
(BEGIN VIDEO CLIP)
DONALD TRUMP, US REPUBLICAN PRESIDENTIAL CANDIDATE: I will tell you, Puerto Rico has too much debt. So you just can't restructure. You have to
use the laws. You have to cut the debt way down. And get back to business. Because they can't survive with the kind of debt they have so,
no. I would not bailout if I was in that position. I wouldn't bail them out.
(END VIDEO CLIP)
LAKE: So I just want you to respond to that.
PADILLO: Well, about the bailout, we are not asking and we haven't been offered. The bills that have been introduced in the House is not a bailout
and we, again, the administration haven't offered of a bailout and we do not want a bailout. What we're asking for --
[16:40:00] LAKE: Governor, let me ask you. It's not a bailout. It's a restructuring, but the condition of the proposal in congress is that you
have a control board put in place. That has been rejected so far. Would you be willing to go along with that so that you can get the process moving
and restore order to the territory?
PADILLO: I have been for an oversight board that helps Puerto Rico and future governments. Not to make the mistake the previous governor did.
But not a control board that can overcome the Republican form of government on the island. And can substitute elected officials. If anything else is
going to be from the people of Puerto Rico should be and have to be through elected officials. No one will accept here in the island taxes imposed by
board that haven't been elected or reduction in services by a board that hasn't been elected.
LAKE: Let me ask you. The Puerto Rican representative in Congress, Pedro Pierluisi, wrote an op-ed in "The New York Times" today and he's critical
of what he called your adversarial approach and he said this, "I view creditors as passengers on the same distressed ship. We're either going to
sail safely to shore together or we are going to sink together." Do you need to change the approach you are taking given the fact you're
encountering so much resistance from Congress, from some members of Congress?
PADILLO: No. Well -- working closely with Congress and with the administration and just following the path with the Treasury Department and
-- I don't know about those expressions. I take it from you that Pierluisi did today in "The New York Times." I had been trying to bring him to the
team, because he has a primary next month. I know that he has to, you know, play politics but this is not about politics. This is about
mathematic and just about that.
LAKE: Do you think you will get --
PADILLO: We'll continue fighting for Puerto Rico.
LAKE: Do you think you will get a deal in place to avert a default in July? That is what everyone is worried about. Are you going to be able to
make the important payments coming up in July?
PADILLO: We are doing our best. We prefer first the deal have to be comprehensive and tackle the crisis. I don't want to make a deal that
bring Puerto Rico back to the same problem in a couple of years. So, we are able. We are now negotiating with traders but what we're asking from
them is a deal that caught the problem for well and not -- I do not want to kick the can that what previous governors did. I'm not -- I decided not to
run again just to be able to bring people to the table without any political, electoral political atmosphere. So yes, I'm able. It's very
hard. Because remember that creditors are not just one group. They are plenty.
LAKE: That's right.
PADILLO: GOs, government loan banks, different groups of creditors and they fight among each other. And they fight with us. So what we're trying
is to make a deal with all of them but a comprehensive one. One that tackles the crisis for well. I really do not want --
LAKE: Right.
PADILLO: I think irresponsible to kick the can.
LAKE: Governor, I know a lot of people are hoping that's exactly what happens. We appreciate you joining us today and sharing your point of
view, Governor Padillo for us, from Puerto Rico.
Now a big gamble for the Prime Minister of Australia, Malcolm Turnbull calls for early elections hopeful Aussies will support his economic plans.
We'll speak live with the minister of finance next.
(COMMERCIAL BREAK)
[16:46:35] LAKE: Australia is on the brink of political and economic upheaval. The prime minister calls for early elections as the new Central
Bank Governor is announced. Philip Lowe will take over the Reserve Bank of Australia in September. This week the bank cut interest rates to an all-
time low of 1.75 percent. The plan is that low rates will help to ward off deflation. And Prime Minister Malcolm Turnbull says he'll call for
elections to be held on July 2. Joining us now from the capital is Mathias Cormann, he is the Australian Finance Minister. Thank you so much for
being with us today, minister. We appreciate it. Let's talk about Australia's economy.
Good to be here.
LAKE: You are really feeling the shift of China. So much of Australia's economy was built around that resource, manufacturing surge in China. That
has gone away and some people say it's never going to come back to its peak. How do you retool the Australian economy to deal with that?
MATHIAS CORMANN, AUSTRALIAN FINANCE MINISTER: Well, we are an economy in transition from resource investment and construction driven growth to
broader drivers of growth and more diversified economy. We are entering into the 26th year of continuous growth and our economy right now is
growing at 3 percent, which is higher than what it was two years ago. So it's certainly higher than any of the G7 economies, higher than the United
States, higher than the United Kingdom, double the growth rate of Canada. The Australian economy continues to perform well. Obviously, our lower
interest rates help through that transition. The lower value of the Australian dollar helps through the transition and the government's plan
for jobs and growth that helps with that transition.
LAKE: And I know part of it there, a new budget has come out and focus on trying to cut corporate taxes to spark innovation. Can you get there? Is
that enough in order to get the kind of innovation that you're talking about when you need to make a big shift in economy like that and really
diversify?
CORMANN: Well, our corporate tax rate in Australia at 30 percent at present is comparatively high by international standards. We have released
a plan to bring that down to 25 percent within the decade, which would bring us back into the middle of the pack of OECD countries. So that will
add over time one percent to the size of our economy on a permanent basis. And so, that's a very important part of our efforts to successfully
transition to a stronger, more diversified economy.
LAKE: We have as, I'm sure you have heard, a fiery election under way here in the U.S. and the leading Republican nominee is talking about getting
tough on China, on trade, and other trade partners. Are you concerned that we are entering a period where countries are moving away from open trade
and trade agreements to a more combative, bilateral trade tariff-type world?
CORMANN: Well, open trade is very important for the world. I mean, open trade leads to stronger growth on a global level and Australia is an open
trading economy. The most successful the world economy, the most successful we are so we are very much in favor of more free trade around
the world. Now, as far as the election in the United States is concerned, we would leave that to the American people to resolve and to settle.
LAKE: I'm sure you're very happy to be able to stay neutral and sidestep your comment on that. We'll see if you get away with it next time.
Minister, thank you for joining us. We appreciate it.
[16:50:00] The U.S. says it plans to regulate e-cigarettes and cigarette industry says we don't want your regulations. Details on that after some
"MAKE, CREATE, INNOVATE."
(COMMERCIAL BREAK)
LAKE: it was a major blow for the e-cigarette industry. The U.S. Food and Drug Administration says that it will regulate all tobacco products
including electronic cigarettes. The new rules will forbid the sale of e- cigarettes to children, and will require warning labels on packages and advertisements.
Gregory Conley is President of the American Vaping Association. He says the rules will cause thousands of small businesses to close. Gregory,
thanks for being with us today. Why is it -- I mean, we had been hearing all along there was confusion about the health benefits. Wouldn't the FDA
be getting involved, sort of clarify that for everyone? Why is this an overt negative for you?
GREGORY CONLEY, PRESIDENT OF THE AMERICAN VAPING ASSOCIATION: First off, thank you for having me. This is a negative because the FDA is proposing
to treat vapor products so much worse than ever treated cigarettes, which kill hundreds of thousands of people each year. Under this regulation, two
years from now over 99 percent of the vapor products on the market today will be banned. It will be modern-day prohibition. Not because the
products are unsafe, but because the small and medium-sized businesses making them will be unable to afford multi-million dollar applications just
to keep one single product on the market, meanwhile big tobacco will flourish and take over this market.
LAKE: You're saying it gives them an advantage. You don't have an issue with the labeling or the caution. You have an issue about being able to
afford it.
CONLEY: Absolutely not. Consistent labeling makes sense at the Federal level, as does extending the minor ban. The problem is that the FDA is
regulating with a sledge hammer instead of with a scalpel. They are going to destroy this industry. They're going to help cigarette markets and this
is going to be negative for public health in the long run.
LAKE: What's the solution? If it's a matter of funding, does it mean consolidation? Can the smaller companies band together? I mean, it seems
like that obviously taking the risk of not putting on warnings for children. You have to find a way to resolve that because small business
can't afford it. Is it a good enough reason not to do it? Isn't there another alternative? Have you gone to the Federal Regulators and what have
they said about this?
[16:55:00] CONLEY: Well let's be clear. Nobody in the industry cares about putting a warning label on a package. Nobody minds having a Federal
Law banning sales to minors. What this law does, what this will regulation does is it requires every vapor product that has coming to market since
2007 to retroactively undergo a multi-million-dollar premarket review process. The only companies that will be able to afford that will be big
tobacco, as well as perhaps one or two wall street-backed e-cigarette firms. Just consolidating will not be enough under this regulation.
LAKE: Gregory Conley, we appreciate you joining us and sharing your point of view today.
CONLEY: Thank you.
LAKE: The DOW is up and then down and then back up. We'll have a check of the markets right after this.
(COMMERCIAL BREAK)
LAKE: News just in to CNN. Some of Hillary Clinton's closest aides have been interviewed by Federal Investigators as part of the ongoing FBI
investigation into her use of a private e-mail server. That is according to U.S. officials briefed on the investigation which is believed to be near
completion. One of the aides who has been interviewed is Huma Abedin. She is a close advisor to Clinton.
U.S. stocks went up and then down. And then they closed back where they began. Dow industrials pulled out a 9-point gain in the final moments of
trade. They had spent the second half of the session in the red after some early gains. S&P 500 and the tech-heavy NASDAQ ended the day down
slightly. Investors are sitting on the sidelines ahead of Friday morning's big jobs report.
A mixed day for European markets. German and British markets closed higher, while stocks fell in France. A rise in oil prices helped boost
energy shares. Shares in Rexall and the Telecoms company, BT rose sharply after both companies reported earnings that topped estimates. The best
gains of the day were in Frankfurt although only just. And that is QUEST MEANS BUSINESS. I'm Maggie Lake in New York. Thank you so much for
watching.
END
