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Quest Means Business
Trump Unveils "America First" Economic Plan; Fact-Checking Trumps' Economic Speech; Delta CEO Apologizes After Mass Cancellations; U.S. Stocks End Lower; Fourteen Gold Medals Up for Grabs in Day Three of Olympics; Ailes' Alleged Used of Fox Funds Raises Liability Concerns; Clinton Offers Rebuttal to Trump Economic Plan; Percentage of Women Billionaires Shrinking. Aired 4-5p ET
Aired August 08, 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, CNN HOST: Closing bell ringing on Wall Street. The Dow Jones is off just a few points. An organization call CheckTech are
ringing the closing bell. A nonprofit for empowering women in the technology industries for equal pay and the like and I'm expecting a --
yes, I think we call that an empowering gavel to end trading. It is Monday. It is the 8th of August.
Tonight, Trump's tax revolution. The Donald vows to jump-start the U.S. economy. We will analyze with both sides what that actually means.
Delta's chief executive says he's sorry for the airline's Monday meltdown.
And from the boardroom to the back room. Questions for Roger Ailes over his use of Fox News funds. I'm Richard Quest. Back in New York. We start
a new week together. And of course I mean business.
Good evening. We begin tonight with the economic speech that Donald Trump gave to get his campaign back on track. The Republican nominee spoke for
nearly an hour and laid out his most detailed proposals so far. He stuck to his script, reading off the prompter, even as protesters interrupted him
14 times. And the message never wavered. An American first policy in what he said was a contrast to Hillary Clinton's globalist view.
(END VIDEO CLIP)
DONALD TRUMP (R), PRESIDENTIAL NOMINEE: I will ask each and every federal agency to prepare a list of all of the regulations they impose on Americans
which are not necessary. Do not improve public safety. And which needlessly kill many, many jobs. Those regulations will be eliminated
quickly.
We are in a competition with the world. And I want America to win.
All policies should be geared towards keeping jobs and wealth inside of the United States. Under my plan, no American company will pay more than 15
percent of their business income in taxes.
I want to jump-start America. And it can be done. And it won't even be that hard.
(END VIDEO CLIP)
QUEST: Jump-start America. Mr. Trump was speaking in Detroit at the center of America's auto industries, and what he called the manifestation
of President Obama and Secretary Clinton's failed agenda. So he wants to jump start the economy. And we're going to jump start with the help of CNN
super screen.
His plan involves three key jolts. The first one, tax reform. He's calling it the biggest tax revolution since the Reagan years. Reducing the
number of tax brackets from seven to three. However, Mr. Trump's top rate of tax -- but all of his rates of tax are higher than they were originally
proposed in September of last year. The top rate was going to be 25 percent. It is now 33 percent.
More jump starting. He said he was going to have a moratorium on new regulation. And he called it a hidden tax on consumers and a drain on
business. And of course perhaps the most famous of his plans, jump starting trade renegotiation tied to the Clinton and NAFTA and Trans-
Pacific Partnership. He said he would withdraw from TPP, he would renegotiate NAFTA, and if he did not get the deals that he wanted or
sought, he would happily walk away. There was a lot in the speech, much of it we have heard before.
[16:05:01] But there were many claims about what a Trump presidency would look like on the economic front. The CNN reality checkers poured over the
speech. Our team is Tom Foreman and he joins us from Washington. Tom, what did we learn, from my magic screen to yours.
TOM FOREMAN, CNN CORRESPONDENT: Well, Richard, we learned that Donald Trump thinks Hillary Clinton's plan for continuing the work of Barack Obama
is a terrible idea. Listen.
(BEGIN VIDEO CLIP)
TRUMP: Home ownership is at its lowest rate in 51 years. Fifty-eight percent of the African-American youth are either outside of the labor force
or not employed. Meanwhile, American households are earning more than $4,000, think of that, $4,000 less today than they were 16 years ago.
(END VIDEO CLIP)
FOREMAN: Let's break this down one piece at a time. Home ownership is at its lowest rate in 51 years. The U.S. census says home ownership, in the
most recent numbers, is at 62.9 percent. It hasn't been that low since 1965. So yes, our first verdict is, true.
What about the second statement here? He said that 58 percent of the African-American youth are either outside the labor force or not employed.
Here is how you get that number. You do a little bit of math here. Basically you say this is the number who are employed as of July 2016,
42.7. You switch it around and say everybody else is without a job. It is true that African-American youth are disproportionately affected by
unemployment in this country. But you can't just do the math this way because it makes no allowance for the number of people who may be in school
or training for some position, who are not looking for work right now, and they're not counted among the unemployed. So this claim is going to be
true but misleading.
The last one, American households are earning 4,000 less today than they were 16 years ago. Well, if you actually do the math on it, June 2014, it
was $53,657 for median income, that's $4,000 less than 2000, but June 2014. Bring it forward to today, more recent surveys say in fact, the number is
now 57,206. He should have updated his math, so his last claim here is false, Richard. We checked an awful lot of stuff here, our abaci are
working very busily, but will have more as the day goes on.
QUEST: Absolutely Tom. Extraordinary job to have to dissect such statistics. Thank you, Tom Foreman joining me now.
The economy has been one of those issues where voters consistently trusted Trump more than Clinton. Now after the Republican convention Donald Trump
held an 11-point lead on that issue. One week later his advantage had all but melted away. The latest poll shows him effectively tied. Secretary
Clinton has just responded to the Trump economic plan. She was speaking at a speech in Florida.
(BEGIN VIDEO CLIP)
HILLARY CLINTON (D), PRESIDENTIAL NOMINEE: His tax plans will give super big tax breaks to large corporations and the really wealthy, just like him
and the guys who wrote the speech, right? He wants to roll back regulations on Wall Street. He wants to eliminate the consumer financial
protection bureau which has saved billions of dollars for Americans. He wants to basically just repackage trickledown economics.
(END VIDEO CLIP)
QUEST: Let's put this to our two guests. Joining me is Stephen Calk, a member of Donald Trump's economic team. He's also chairman and chief
executive of the Federal Savings Bank. And Laura Tyson who chaired president Bill Clinton's council of economic advisers. She has praised
Hillary Clinton's economic plans. Guests both, I expect there's not going to be a huge amount of agreement if any at all on the areas. But let's
try, please, and offer more light than heat in this debate.
I'm starting with you, Stephen Calk. The plan today, we didn't really get that much more detail than we had back in September, except Donald Trump's
tax rates are up to 30 percent higher than they were originally going to be in September. So what happened?
STEPHEN CALK, CHAIRMAN AND CEO, FEDERAL SAVINGS BANK: Look, that's a great question, Richard. At the end of the day it's about specificity. People
are looking to understand the numbers a little better. Making sure the numbers will work. Balancing the budget, making sure the appropriate
amount of revenue will be brought in to attack and fund the various programs that Mr. Bush -- excuse me, Mr. Trump is hoping to advance.
[16:10:00] QUEST: Right, so Stephen, you believe that these numbers are more realistic, and say for example, the various centers for tax reform,
the Taxpayers Association who basically said -- who do not believe that this will blow a massive hole in the deficit even though you are relying on
trickledown economics?
CALK: No, quite the opposite. I believe that, look, what we want to do is create good jobs. Good jobs come from good profits. Those good profits
create opportunity. We want to reignite the entrepreneurial spirit in our country and create that opportunity to grow our economy again. That's what
we're really trying to do here.
QUEST: Laura Tyson, we saw that worked in President Reagan. It did create a lot more jobs. It certainly did, at one level. What's wrong with it
from your point of view?
LAURA TYSON, FORMER CHAIR, WHITE HOUSE NATIONAL ECONOMIC COUNCIL: I'm not sure what you mean by it worked under President Reagan. But I just will
point out that I believe that the strongest job records and the strongest continuous expansion was actually under President Clinton, who did not do
massive tax cuts, disproportionately biased to the wealthy.
So I think the issue here is, and this is specificity, this is what you're asking for. I think we need to have a plan which shows us why the advisers
to Donald Trump believe that this kind of tax cut, which -- and a proposal to look at regulations but no specificity, and a proposal to sort of
renegotiate trade. How do you get to those proposals and doubling the growth rate? I think, you know, basically we now have to have the
forecasters go back and look at Trump's new tax numbers. But the old numbers suggested we were going to have a huge explosion of the deficit and
we were going to kill 3.5 million jobs. So basically we need to understand why there is the believe that these jolts will actually have the effect.
And I don't think the macro models support that.
QUEST: And there is a valid point, isn't there, that to increase growth by that much to gain higher tax revenues to counter, Stephen Calk, it will be
very difficult, especially in a post-great-financial-crisis, where nobody is growing at more than 2, 2.5 percent.
CALK: Look, at the end of the day we're talking about operating off of eight years of failed economic policy. At the end of the day we must super
charge this economy. We must get more aggressive and create opportunities for entrepreneurs to start businesses. For folks to take a chance and
reinvigorate this economy. You talked earlier about the fact that home ownership rates are the lowest that they've been in 51 years. Look, one
simple reason is the complete lack of confidence that people have that they'll be employed, so they can go out and buy a job. Look, I'm an expert
in home ownership. And I can share with you the fear of not only overregulation, but the fear of going through that process has to change if
we want to increase home ownership rates in America today.
TYSON: So I guess my response to that would be, first of all, let's look at those eight years. So let's actually look at what the Obama
administration inherited. The Obama administration inherited the greatest recession since the great depression, with danger we were going to go into
a great depression again. Where did that come from? That came from the Bush policies, which are the same policies of cutting taxes
disproportionately for the wealthy. There was a destruction of manufacturing jobs, I think 2 million during that eight years. And as you
yourself, Richard, pointed out, the experience of the U.S. economy coming out of this greatest recession since the great depression, has we've
outperformed everyone. We've outperformed all of the other economies.
CALK: Look, at what time do we stop the excuses of what I'm hearing --
TYSON: There's no excuse. That is reality.
CALK: Two consecutive administrations of failed policies. And here in America --
QUEST: Now, now, ladies and gentlemen. Ladies and gentlemen. Now I want to turn to trade. Because when I hear the arguments and counterarguments
on NAFTA and South Korea, I freely admit I do not know what the real answer is. But Laura Tyson, you negotiated or at least were there when NAFTA was
negotiated.
TYSON: I was there.
QUEST: And you've written a book, "Who's Bashing Whom on Trade." Stephen Calk, tell Laura why you think these trade deals need to be renegotiated.
CALK: Look, at the end of the day my friend on the other side of the aisle here, Laura, is a brilliant professor. But we need to come down from the
30,000 foot, for lack of a better word, academic view. We need to understand what's happening with the business people on the street as
they're manufacturing and selling and conducting trade overseas. We have cut bad deals. Those deals need to be re-looked-at. The simple fact of
the matter is they're not generating the growth. They're not generating the revenue for Americans in American companies, for American workers, and
the American people.
[16:15:03] QUEST: Laura Tyson, Donald Trump talked about South Korea and the -- I've been online all afternoon trying to work out what the truth is
on South Korea. But it does seem to suggest he's right, it's not been the great benefit, the South Korea free trade agreement, that it was promised.
TYSON: Well, look. I am not going to -- I have not spent the afternoon looking at the South Korea free trade agreement. What I will say is, I
think on this issue, Secretary Clinton has been entirely clear about her position. She has said she looked at TPP and decided no, it does not
create good jobs for Americans. She looks at employment issues, she looked at wage issues, she said, no, this one doesn't do it. We do have to worry
about currency and what happens to currency. Our current trade negotiations and PACs don't include currency. We have to be much tougher
on rules of origin.
If you're going to treat a U.S. product as a U.S. product, how much of the material in that product is made in the U.S.? Those are specifics that
I think we need to look at. I don't think that -- I would say that Secretary Clinton is very clear that we have to look at the trade
agreements in the same -- with the same perspective in terms of jobs and wages that Donald Trump is talking about.
CALK: We cannot carry on the old policies. We have to re-look at those, we must renegotiate them.
QUEST: You can't renegotiate or it will be extremely difficult to renegotiate NAFTA, a treaty that is there, working, has been for decades.
And I'm not sure where one would even begin without destroying the trade relations with Mexico and Canada. Stephen Calk, how are you going to do
it?
CALK: Look, at the end of the day, if a deal doesn't work for America and we are constantly getting hammered and there is no upside benefit in the
macro for the American people, we must stop, pause, and look at everything, everything must be on the table for Mr. Trump to re-look-at, renegotiate,
and lay out a better plan, a better deal for the American people. It's that simple. If we have a failed policy like Laura shared and it seems
like there's agreement from Ms. Clinton and perhaps the Democratic Party, let's come together as a team. Let's come together as Americans and
renegotiate deals and execute on things that are going to help America to create quality jobs.
TYSON: So one thing -- can I say one thing. We also can do, and I believe that Donald Trump talked about this today, but it's been a key part of what
Secretary Clinton has been talking about throughout the campaign. And that is, within existing trade agreements, we can be much more forceful at going
and enforcing the agreements we have. So Secretary Clinton has proposed --
QUEST: Except people never do --
TYSON: -- a chief trade prosecutor to do that. No, but we should.
QUEST: Laura Tyson, but they never do. They never do. I can't think of one trade agreement where anybody's actually gone back and --
TYSON: No, the point is, we certainly have. The U.S. has gone to court many times on WTO infringements. So I think we can do much, much more on
that score. Even as we look at trade agreements and figure out, for example in the TPP, is there any way to renegotiate that, to look at jobs
and wages. I think that is what -- that's a combination.
CALK: Except that the all last settlement that was created resulted in the smuggling of hundreds of millions of dollars in an unmarked plane to Iraq.
Is that the way we're --?
QUEST: Let's not open that one.
TYSON: That has nothing to do with trade agreements.
QUEST: And on the question of planes, trade, and other things, I'll thank Laura Tyson, Stephen Calk. Thank you both for joining us. I think we put
a great deal of light onto the issue.
Now, you know it's not an ordinary flight delay when the pilot announces that pizza has been ordered to be delivered to the plane. It's one of the
many stories stemming from Delta's worldwide ground stop. We're going to be at the airport where it all started in just a moment. It's QUEST MEANS
BUSINESS. Good afternoon.
(COMMERCIAL BREAK)
[16:21:11] QUEST: An executive of delta airlines is apologizing to customers after a computer outage caused a global ground stop for more than
six hours. A power outage at Delta's hub in Atlanta appears to be to blame. So far 450 flights have been cancelled. It left hundreds of
thousands of passengers stranded worldwide. Delta is the world's second largest airline. It flies to 60 countries across six continents. This is
likely to cost it tens of millions of dollars. The chief exec says his team is doing everything they can to get the system back up and running.
(BEGIN VIDEO CLIP)
ED BASTIAN, CEO, DELTA AIR LINES: I apologize for the challenges this is creating for you in your travel experience. The Delta team is working
very, very hard to restore and get the systems back as quickly as possible. For those who have been inconvenienced and need to access and make changes
to your travel plans, we've instituted system-wide waivers and you can access those through either delta.com or by talking to any of our
reservation agents.
(END VIDEO CLIP)
QUEST: Martin Savidge is at Hartsfield Jackson International in Atlanta. The world's -- I was going to say -- well, actually Atlanta is the world's
busiest airport. Martin, things have calmed down on the land side to some extent. Do we know how bad things are system-wide for Delta?
MARTIN SAVIDGE, CNN CORRESPONDENT: Because you're right, if you look at or expect to see long lines behind me, you don't see that, which is a clear
indication, at least at the checkout counters in Atlanta, and that's only a fraction of the whole Delta line, there isn't much of a problem. But look
up here, you still see on the flight boards that some of these flights are listing hours of delays. We're getting into evening flight times. That
means those delays have been diminished somewhat. But the other thing is that flight board doesn't list all the flights. There are a lot of flights
that have been impacted that aren't even up there.
People had to go see a ticket agent to figure out what happened to their flight. For the most part, people seemed to be handling it OK, as far as
their temperament. But the reality is also this, they got through the check-in process and got pushed to the gates. It was there they began the
long nightmare of waiting and waiting and getting updated and waiting and moving gates. That was the real frustration. And it still continues. The
good news is, most of the European flights are leaving on time tonight, so it should be a better day in Europe tomorrow. We'll see.
QUEST: So do we know the cause? I've seen power failures leading to computer outages or something. Do we know who is to blame?
SAVIDGE: The local power company, Georgia Power, that supplies the computer operation center says it was not their problem. In other words,
it wasn't weather-related and wasn't a power outage caused by the power company. They blame switching gear which they say Delta owns and
maintains, that there was a failure in that system and that's what caused the power outage.
Whether it was a power outage that last a fraction of the second or whether it lasted longer than that, we don't know. But we know it had a did he
devastating impact on the computer system. So the whole question still comes back to, was there a backup plan, are there backup generators, and if
not, aren't there other computer systems in other places that would have presented all of prevented all of this? Delta has been silent.
QUEST: Martin Savidge, who is at Atlanta's Hartsfield, Martin, thank you.
The issue that Martin was talking about there, of the power outage, whatever the cause was, it probably shouldn't have had such a dramatic
effect on the totality of Delta's network wide operations. And that's the theme that I've taken in the newsletter. Delta grinds to a halt for hours.
And you can subscribe to our newsletter, at CNNmoney.com/quest. It arrives just after the markets close in New York. There isn't any major market
trading in the world at the moment. So it will brief you before the Middle East, Europe, and Asia starts trading for Tuesday.
[16:25:00] The early gains couldn't be helped, they were very early and they soon evaporated. The Dow Jones Industrials ended 14 points lower.
Paul La Monica is at the New York Stock Exchange. It was a very early gain that turned into a long decline.
PAUL R. LA MONICA CNN MONEY CORRESPONDENT: Yes, we hit record highs for the S&P 500 very early in the morning. But that fizzled pretty rapidly.
At the end of the day, no too awful of a day for stocks, especially in the context of Friday's big rally. We finished relatively flat. Energy stocks
were big winners, because oil prices have started to move higher again on the news that surprise September OPEC meeting.
QUEST: that surprise September OPEC meeting we'll have to talk about that over the next couple of days, what's likely to come from that. Paul La
Monica who is at the stock exchange, Paul, thank you.
LA MONICA: Thank you.
QUEST: There are tensions over Russia's doping scandal and are playing out between athletes currently competing in Rio as well. Don Riddell is in
Rio. The athletes themselves now are getting involved in this. What's going on?
DON RIDDELL, CNN WORLD SPORT: Yes, very much so, Richard. Plenty of drama in the aquatic center last night, with one American swimmer, Lilly King,
taking exception to the fact that a Russian swimmer Yulia Efimova decided to kind of pronounce herself number one. She was doing this and kind of
raising her finger up. And King took exception with that for a number of reasons. Efimova has served a 16-month ban for doping. She actually
failed a test for meldonium earlier this year. She was associated with that devastating WADA report which accused Russia of state sponsored doping
program. And this swimmer was actually only cleared to swim on Saturday night. No explanation was given.
So when she arrived in the pool last night, she was booed by pretty much the entire arena. Then had the audacity to say she was number one. Lilly
King really had a problem with that. She went out and put in a better swim of her own later on in the heat of the 100-meter breaststroke and then kind
of wagged her finger and said, not so fast. It's going to be very interesting when those two go head-to-head in the final later on this
evening, Richard. This is what we're now seeing playing out as a result of the IOC's decision to let all of these Russian athletes in. The clean
athletes or the non-Russian athletes have a problem with it.
QUEST: Don, I know you've probably answered this question a million times. I'm going to ask it again. Why did the IOC do it? Why did they take such
a liberal and loose policy in the final analysis? Particularly bearing in mind what's happened with the Paralympics.
RIDDELL: Yes, the Paralympic committee taking a completely different approach in coming out on Sunday and basically saying the Russians aren't
welcome at all. The IOC has been on the back foot. A lot of people were hoping the IOC would have followed WADA's guidance and gone for a similar
kind of punishment. Their take is to defer to all the different federations that make up the Olympics. So there's federations of 28
different sports here the IOC decided --
QUEST: But why? Why did they do that?
RIDDELL: Well, how long have you got, Richard? This is very, very complicated. And a legal mine field. A cynic would argue that the IOC
didn't really want to ban Russia from the Olympics, given that they are one of the biggest players in world sport. They hosted the Olympics two years
ago. The World Cup in two years' time. And they basically said, the federation is no better than us. These are the guys that that know these
athletes within their individual sports. And so it was put out to them to make that decision. The way the IPC is set up is completely different and
they were able to say, there's only one federation and we can decide. It's very controversial as you know.
Don Riddell, who is in Rio. We'll talk more about it as the week goes on, and hopefully we'll talk about some sport before the week is over. John,
we thank you for that.
RIDDELL: hopefully.
QUEST: Now we're going to turn to legal experts believe that 21st Century Fox could face liability issues. That's if the allegations are proving
true that Roger Ailes misused company funds. What was he doing with the funds? We'll discuss that after the break. It's QUEST MEANS BUSINESS.
[16:30:00] (COMMERCIAL BREAK)
QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. Cybersecurity experts show us how you can literally hack an
election.
And Moira Forbes will be here to talk about the gender gap for billionaires that's getting as big as their bank balances. And as we get ready for that
this is CNN. And on this network, the news always comes first.
The Pakistani Taliban have claimed responsibility for a suicide bombing in Quetta near the Afghan border. Seventy people are dead and a hundred
others are wounded. Many of the victims were lawyers gathering at a hospital to protest against the killing of an activist colleague. An
eyewitness describes the moment of the blast.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE (through translator): When the explosion took place, we were on the other side. I was hit by shattered glass. We were hurt. It
was a very loud explosion and very strong and I don't know what happened. So many of my friends were martyred. I thank god I was saved. I think it
was my mother's prayers that we have come through and she protected me.
(END VIDEO CLIP)
QUEST: Japan's Prime Minister says he will think seriously about the government's next steps after the country's Emperor said he may not be able
to fulfill his duties in old age. Emperor Akihito spoke in a televised address. It's only the third time the Emperor has spoken publicly in
Japanese history. He says the country must make plans for his eventual successor.
(BEGIN VIDEO CLIP)
EMPEROR AKIHITO, JAPAN (through translator): I am already 80 years old. Fortunately, I am now in good health. However, when I consider that my
fitness level is gradually declining, I am worried that it may become difficult for me to carry out my duties as the symbol of the state with my
whole being as I have done until now.
(END VIDEO CLIP)
QUEST: An American and an Australian man have been kidnapped in Kabul. The two electors at the American University of Afghanistan. Two gunmen
abducted them from a car on Sunday night. The U.S. embassy in the Afghan Capital says it's working with local police to find the men. There's been
no claim of responsibility for the kidnapping.
Donald Trump has laid out his most detailed economic proposals to date. The Republican presidential nominee is proposing a moratorium on new
government regulations and a renegotiations of trade policies. He's also calling for a simplified tax structure.
The chief executive of Delta airlines has apologized to customers after a power failure in Atlanta took down the carrier's computer systems
worldwide. There's a six-hour ground stop that resulted in nearly 500 cancellations. There were delays for hundreds of thousands of stranded
passengers.
Legal experts say 21st Century Fox could face liability issues after allegations emerged that Roger Ailes used Fox News funds for personal gain.
[16:35:00] It was in a "New York magazine" report that alleges that Ailes used his company's budget to hire consultants and political operatives and
even private detectives. They went after his enemies. Brian Stelter, joins me now. Dirty tricks, Mister Stelter.
BRIAN STELTER, CNN MONEY SENIOR MEDIA CORRESPONDENT: Nixonian, yes.
QUEST: What would he use a slush fund for what?
STELTER: I say Nixonian because Roger Ailes was an aide to Nixon decades ago. And this kind of behavior reminds us of the Nixon era. He was using
these consultants, these operatives to conduct his own private investigations allegedly. Ailes has been deigning these sexual harassment
claims. But at this point we are way beyond sexual harassment claims. We're also talking about other strange inappropriate behavior using Fox
News money for his own private investigations.
QUEST: I mean, do we know what these investigations were? Were they, if you like, salacious, were they political? Was it point-scoring or was it
revenge? Do we have any idea?
STELTER: According to "New York Magazine," some of this was following journalists, trying to track them down, see what they do in their daily
lives and then report back to Ailes about those journalists.
QUEST: To what point?
STELTER: We're talking about writers from Gawker and this writer of the article are Gabriel Sherman, of "New York Magazine." Sherman was writing a
book about Ailes several years ago, and according to this report, Sherman was one of the reporters who was followed by a private investigator. Ailes
apparently wanted to know as much as he could about the people that were trying to cover him.
QUEST: The question of legal liability for Fox is somewhat remote, at best it was probably outside any formal scope of duty. So getting the money
back is not going to be the issue. The issue is who knew what up the Fox tree, the auditors, 21st Century Fox themselves, and ultimately the
Murdoch's.
STELTER: All the way at the top. Rupert Murdoch and his sons, Lockland and James Murdoch, the trio running the company now. I've asked repeatedly
for comment from the company about what the Murdoch's knew if anything about these harassment allegations by Ailes. They've just steadfastly
refused to answer the question. Off the record sources will say, the Murdoch's knew nothing. But a lot of people wonder how is that possible?
How did Murdoch's not know, one of their most employee was doing over a period of -- these allegations over a period of 20 years? Did Ailes really
have that much autonomy? Is it possible the Murdoch's didn't want to know what he was doing?
QUEST: On the question of these funds, are we talking large sums or about the sort of thing that the auditors wouldn't have even looked at?
STELTER: There was one settlement of $3 million. In other cases, we're talking about smaller sums of money. Some of these consultants, I've
reached out to today for comment, they were making maybe $10,000 a month. For Fox News that takes more than a billion in profit, that's small
potatoes. However, the idea that Ailes was using this, in his own kind of personal way, to get back at critics, to get revenge on people. That is
not the behavior of a news executive. That's the behavior of a political boss.
QUEST: Do you get the feeling that 21st Century has actually gone in there, like the old phrase, like a dose of salts, to find out what -- they
really are going in there to find out what if every little nook and cranny, there may be in there?
STELTER: I tell you, half my sources say yes and the other half say no. I just got off the attorney representing a host at Fox News, Andrea Tantaros.
This woman was benched three months ago, she hasn't been on the air. There's been all sorts of speculation about why. Well, today her lawyer is
saying, it's because she was harassed by Ailes and Fox was trying to keep it quiet. There have been other stories about why she was benched. It's
all in dispute. But this attorney says she still hasn't been called into investigators who are looking into Ailes's behavior. You would think if
there was a host sidelined three months ago, and your investigation the behavior of the company, you might want to call her and interview her like
you've been interviewing dozens of other women at Fox News. My point being, it seems like there's a lot of work to do for these investigators.
That they haven't spoken to everybody they need to speak to, to get a complete picture of what the heck was happening at Fox News. On the other
hand, other sources say, yes, this is a thorough investigation. They're getting to the bottom of it. There's just not a lot of clarity whether
that's actually happening.
QUEST: Brian Stelter, excellent sir, thank you very much. And of course our newsletter as well, where do we sign up?
STELTER: We're newsletter colleagues.
QUEST: Where do we sign up for your newsletter.
STELTER: CNNmoney.com/media.
QUEST: CNNmoney.com/media. Thank you very much. We'll have more newsletters than you can shake a stick at. We'll have Secretary Clinton's
rebuttal to Donald Trump's economic plan, the specificity that we heard, after the break. This is QUEST MEANS BUSINESS.
[16:40:00] (COMMERCIAL BREAK)
QUEST: Hillary Clinton is pressing on with her campaign. She's in the vital swing state of Florida. Now, in 2000, of course, the presidential
election in Florida, it was the scene of controversial over paper ballots. Do you remember hanging chads and the like where you had to look to see
what the voters' intent was by whether the chad was still collected to the ballot paper. Well, Donald Trump has reignited the prospect of election
cheating ever since he began saying the 2016 contest could be rigged against him.
(BEGIN VIDEO CLIP)
TRUMP: A rigged system.
TRUMP: Rigged, rigged, rigged.
TRUMP: To rig the system.
TRUMP: Rig the system.
TRUMP: Totally rigged.
TRUMP: Rigged press.
TRUMP: Totally rigged system.
TRUMP: The election is going to be rigged.
(END VIDEO CLIP)
QUEST: There is so far, that we can see, no evidence the results in November will be tampered with. However, Laurie Segall is at the Black Hat
Security Conference in Las Vegas where she's been meeting with experts who say some voting machines are indeed vulnerable to hacking.
(BEGIN VIDEOTAPE)
GEORGE KURTZ CEO, CROWDSTRIKE: I think a hacked U.S. election could tip the balance to one candidate or the other.
LAURIE SEGALL, CNN MONEY SENIOR TECHNOLOGY CORRESPONDENT: Over the last few months, hacking and politics have become a dangerous combination with
the DNC and Hillary Clinton getting hacked. We're here in Las Vegas for Black Hat. It's a conference were the best hackers in the world get
together to talk security.
Now where there's no indication that the voting process has ever been hacked, we decided to ask some of the hackers here to see if it was even
possible.
You guys were pulled into help the DNC figure out whether or not they've been hacked. And you did figure out that they had in fact, been hacked.
And all signs point to Russia. What are the implications of this?
KURTZ: I think that this is a bit of a watershed event. I mean, 40 years ago we had Watergate. That's where you had a couple of boxes of files that
were stolen. Now we're talking about 20,000, 30,000 files being dumped on the internet.
SEGALL: Do you worry that there are other state actors sitting on important internal conversations that pertain to the U.S. elections?
KURTZ: That's 100 percent certainty. It's not even a doubt in my mind that there are other actors out there that have yet to be found. It's too
big of an opportunity for them. It's too easy to get in.
SEGALL: But it goes beyond the campaigns being vulnerable. What about the actual machines we use to vote? A security firm called Symantec actually
purchased a couple of electronic voting machines on eBay to see how secure they are. Now you have to remember that there are a ton of different types
of voting machines out there, and each U.S. county uses what they feel works, including electronic and optical scanning devices. And about 75
percent of the country still makes their choice on plain old paper. In this particular case, these hackers say they found some major issues. Here
is their perspective.
BRIAN VARNER, SYMANTEC SENIOR RESEARCHER: So what we're seeing is what a voter would be presented with when they go into a precinct. When you get
your voter identification card, which is a smart card, and you would insert it into the machine. And then go ahead and start your voting process.
With the smart cards running small little computer systems on there, a device as tiny as this could be used to manipulate the smart card to allow
you to vote multiple times.
SEGALL: So the idea behind this is anyone who is able to kind of get their hands on the cards that are going to be used, if they have the technical
skills, they could essentially build what you've just built, which allowed them to go cast their vote as many times as possible.
[16:45:00] VARNER: I could probably put about 400 votes in myself in less than a couple of minutes and the poll workers would be none the wiser.
SEGALL: Take us through what happens after you submit your vote. What are other ways that this could be vulnerable?
VARNER: These devices have to communicate with some sort of database system. We don't know what the transport network looks like between this
machine and the actual database server. Anywhere along that path, if a hacker was to have something installed, then the communications could be
intercepted.
SEGALL: Given all this research, what would you say is safer, electronic voting or voting paper?
VARNER: Well, I can tell you this year I will be voting via paper with a mail-in ballot.
SEGALL: As somebody who is knee deep in the vulnerability field, you see the worst that can a happen, what keeps you up at night?
VARNER: A compromised election.
SEGALL: Varner says he doesn't believe we're that close to a compromised election yet, but he does want to raise awareness of these types of
vulnerabilities. What I did hear from these guys, is that even if one machine is seen as compromised, that has broad implications and how the
American public trusts the political process. Back to you.
(END VIDEOTAPE)
QUEST: Laurie Segall in Las Vegas. As Donald Trump overhauls his economic plan in Detroit, Hillary Clinton is touting her plan for job growth as she
goes on a two-day tour of Florida. A few hours ago, Secretary Clinton, offered a stiff rebuttal to the Trump economy. And said the Trump
presidency would end up with lower wages, fewer jobs, more debt, and tax breaks for the rich.
CNN's Pam Brown is in St. Petersburg in Florida where the rally has just ended. You're all alone there, Pam, the Secretary is gone. The stage is
empty. But from what I was listening to her, it was a fairly full-throated rebuttal of what Donald Trump said was her failings in government.
PAMELA BROWN, CNN CORRESPONDENT: it certainly was. And I should say that it was packed in here when she had this rally earlier. Today she really
did come out and take aim at Donald Trump and his economic plan. Basically saying that his tax plan is only meant to help the wealthy, just like
Donald Trump, she says. And it's happening at the expense of the middle class in America. And she said, on the other hand, she's very different
from Donald Trump, she says she's going to create jobs in her plan and really support hard working Americans who want to start small businesses
just as her own father did.
QUEST: But with this in mind, the polls show them virtually neck-and-neck now on the question of economics. It's getting more difficult to some
extent to put water between them. What is the secret weapon she has to unleash in that respect?
BROWN: I should say that in June, our polls for CNN showed he had the lead whether it came to the economy, but now our latest poll actually shows her
having a lead, a couple of points now, when it comes to the economy. So this is a really crucial time for her. Of course she's in Florida, that is
no coincidence, this is a battleground state, a crucial one, a state that Donald Trump won in the primaries. And so she's trying to capitalize on
the momentum she's seen in the polls when it comes to the economy and the overall poll showing her ten points ahead by really focusing on this idea
of creating jobs. Helping middle class Americans. Saying that she's not going to raise taxes on the middle class. She will create more jobs
through innovation, and really going against Donald Trump.
QUEST: And when he comes out like he did today with what will be a populist move, not only of a major tax cut but also offering tax deduction,
for a full tax deduction against childcare, she's only offered up to 10 percent of income. Is that perceived -- does she have to move further on
some of these policies? He's basically coming out with a spend policy to try and get voters.
BROWN: Right. It's clear that he's trying to broaden his base and be appealing to people beyond just those supporters he's had thus far. She
did not directly address the fact that he's asking for those specific tax cuts here today. But she is clearly trying to appeal to the same kind of
people that he is in that way. But she didn't talk about that. It will be interesting to see if she does address it and it does cause her to shift in
that direction. We saw with Bernie Sanders the influence he has had. She, by many people's accounts, moved more to the left because of some of the
policies that he introduced.
QUEST: You have many more miles to travel in the days, weeks, and month ahead. Pam Brown who has been traveling in Florida tonight.
Hillary Clinton says she has smashed the glass ceiling. Female billionaires aren't feeling it. The wealth gap between male and female
billionaires is growing. Now, joining us is Moira Forbes. Wonderful to see you. How good to see you. Come and join me in the C suite. We'll be
talking about billionaires after the break.
[16:50:00] (COMMERCIAL BREAK)
QUEST: 8.4 to 1. That's the ratio of male billionaires to female billionaires, 8.4 to 1. And the imbalance is growing even as the total
number of billionaires rises as well. It's clearly a rising tide not lifting all boats. Now, female billionaires are also more likely to
inherit their wealth than their male piers. Moira Forbes is the publisher of "Forbes Women." She joins me now. What's your best guess as to why
women are failing to become billionaires? Because one might have expected in an era of maybe equality, but a least they rise at the same rate, but,
no, men are rising faster.
MOIRA FORBES, EXECUTIVE VICE PRESIDENT, FORBES MEDIA: Well, I think it is disappointing. I mean that the fact that the numbers of female
billionaires have largely remained stagnant. There's been some movement. But I think the opportunities for billionaires have never been greater.
There are more of them around the world, and women's opportunity to take advantage of those growth paths is limited. When you look at the number of
billionaires most of them are self-made entrepreneurial paths. But still access for women to pursue those paths is limited. Women's
entrepreneurship is still in its infancy around the world.
QUEST: That's interesting isn't it, because in theory there's no reason why women can't have as much of a good idea. It's the execution of the
idea, the access to capital and the access to support to make it viable that prevents it happening. Rolled in the idea of a deficit at the
beginning.
FORBES: I think what's really exciting and positive is the access to opportunities, the barriers to entrepreneurship have never been lower. You
see women taking advantage of that hugely. There's never been more self- made female billionaires in the world. But again, we're speaking from a very, very low base. Was really telling in the study is that of the 148
new billionaires this year, only eight of them were women. So very, very slow growth.
QUEST: And those eight, the study also showed the level of inherited wealth. Of those eight, we need to look closely to see how much was
inherited, how much self-made.
FORBES: The majority is still inherited, by and large. That will be the case I think for a very, very long time. But nonetheless, we're seeing
movement though in terms of how those inherited billionaires are using their wealth. Women now are seeding new businesses, they're not sitting on
the capital, particularly in markets like Asia. And they're not necessarily just complacent to do things as they were done before.
QUEST: I do want to turn, if you may, to Donald Trump today and his economic policy. He's come up with the idea of basically unlimited
childcare tax deduction. Now, I'm guessing there's a reason why there isn't a higher level of tax deduction for children. It's because -- for
childcare. It's because it's very expensive.
FORBES: It is very, very expensive. And when you look at employers, it puts a huge burden on them. So it is challenging to do it in a sense that
allows for economic growth and allows to do so in a way that still offers opportunities for parents to be with their children.
[16:55:00] I think we still have a long way to go with the policies. Childcare and care giving in general is one of the biggest issues that
still remains around the world for women as they navigate their careers.
QUEST: Is it? When you come up with a policy that basically says we're going to raise to unlimited levels of amount of childcare you can deduct
against taxes. That is almost -- I don't use the word bribing, but literally, but it's basically saying to women, vote for me and you'll get
more. Is it going to work for a candidate that already has, if you like, a sour relationship with women?
FORBES: I don't think it's actually going to work. I think at the end of the day women and men will vote for the best policies that drive economic
both. But I think it is important and it is positive to see the Republican candidate talking about issues like this which have been largely ignored by
the party.
QUEST: And largely, of course, maybe at the behest of his daughter, Ivanka.
FORBES: She's A driving force for women who work. And so I do think this is a positive sign. Is unlimited realistic? Probably not. But it's a
good place to start.
QUEST: We'll talk more about billionaires and how one becomes one. Thank you very much indeed.
FORBES: Thank you, Richard.
We will have a Profitable Moment after the break. It's QUEST MEANS BUSINESS.
(COMMERCIAL BREAK)
QUEST: Tonight's Profitable Moment. The power failure at Delta and what on earth that meant, when all the lights went out and things got extremely
dark. It's not supposed to happen to an airline. They have huge amounts of redundancy. They have lots of different systems. But what we
discovered with Delta is that those systems failed. And of course they will be investigating why it went wrong. But the reality is, airlines are
such complicated animals with so many literally moving parts that, as you can see, which things go wrong, it's dramatic and it's absolutely
unfathomable for hundreds of thousands of people around the world. What a shame, only last week Delta was boasting it had carried 600,000 passengers
in a day. We'll see how many of them are pleased today.
And that's QUEST MEANS BUSINESS for today. I'm Richard Quest in New York. Whatever you're up to in the hours ahead, I hope it's profitable. I'll see
you tomorrow.
END
