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Quest Means Business
Study Reveals Cost of Obamacare Replacement; Dutch Prime Minister Warns of Europe "Domino Effect"; Scottish First Minister Calls for Independence Vote; Wall Street Warrior, Preet Bharara Fired by Trump; Israeli PM Hails $15 B Mobileye Takeover; Turkey Suspends Diplomacy with Netherlands; Merkel-Trump Meet Delayed Due to Storm
Aired March 13, 2017 - 17:00 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 ANCHOR: An hour ago, the closing bell rang on Wall Street. The Dow was off just 21.5 points. Just around 20,881.
So, it's not actually -- oh, good grief, good grief, sir. That was what you call an energetic gavel. That brought trading to a close Monday. It's
March the 13th.
Tonight, the score's in, and now the estimates and costs of repealing and replacing Obamacare. We're going to talk about that next.
A vote on Brexit, and now a Scottish vote on independence. And a Dutch vote on the government itself. Mark Rutte's warning of domino effects.
And the fall of a Wall Street warrior, Preet Bharara is fired by Donald Trump. We'll discuss what this means of the prosecution who was in white
collar crime.
I'm Richard Quest live in New York where of course I mean business.
Good evening. In the last hour, a U.S. Congressional report has predicted a huge increase in the number of people who will be without insurance if
the Republican Party's new health care bill becomes law. Now it's the nonpartisan Congressional Budget Office, the CBO as we'll call it, and it's
warning that 14 million more people will be uninsured next year. And that number rises to more than 20 million and 30 million in the next six years.
It also says the bill will reduce the federal deficit by $337 billion over the next nine years. And the biggest savings come not from those who buy
insurances but from reduction in Medicaid outlays. That's the U.S. government's plan for the low-income and the poor. Now earlier in the day
president Trump's accused the media of talking of Obamacare, which of course his new plan repeals and replaces.
(BEGIN VIDEO CLIP)
DONALD TRUMP, U.S. PRESIDENT: So, the press is making it look so wonderful that if we end it, everyone's going to say, oh, remember how great
Obamacare used to be. Remember how wonderful it used to be. It was so great. It's a little bit like President Obama. When he left, people liked
him. When he was here, people didn't like him so much. That's the way life goes.
(END VIDEO CLIP)
QUEST: Our White House reporter Stephen Collinson is in Washington. Stephen, how damaging are these numbers to the Republicans' bill?
Particularly this number, this headline number about the number of uninsured people if the Republican plan becomes law?
STEPHEN COLLINSON, CNN WHITE HOUSE REPORTER: Richard, I think it gives the Republican Party a huge political headache. They've been trying out
various kinds of spin over the last few days as we awaited this number, basically saying, look, this is just the repeal bill. The replacement bill
hasn't come yet. We're ending a government mandate so of course some people aren't going to buy health insurance. Or there saying it's not
really about the number, it's about increasing the access of a market-based health insurance system that they say will work better than Obamacare. But
those explanations do not really account for the fact that this is a huge number. 14 million people more uninsured by next year. That's something
that the Democrats are already seizing on. I think it gets to the key point about this health care debate. It's one thing to reform health care
when you're giving people coverage. When you can be portrayed as taking coverage away from people, however that may be nuanced, it's a much more
difficult political thing and it's going to make it much more difficult to pass this through the Congress.
QUEST: Of course, that's only the number next year. That number of uninsured people continues through until 2026. Also, at the same time, it
talks about premiums that will rise for the next eight or nine years. And they don't start to fall again until 2026.
COLLINSON: That's right. And I think what it does is it just makes Paul Ryan, the House Speaker's job much more difficult as he tries to sell this
bill. You've got people in the House who don't think the bill goes far enough, conservatives. Then you have people in the Senate do you want to
go up and where this bill must also go through, where it's much harder to pass because the Republicans have a much smaller majority, who are very,
very concerned.
[16:05:00] Moderate Republican Senators from states like Ohio where Donald Trump won, they really are worried about how they're going to vote for this
if it looks like a lot of people are going to lose care. So, this makes the whole political equation of passing this bill that much more difficult.
And these explanations have come up. You've played the clip of the president himself there. His tactic now seems to be just to pile on
Obamacare and say it was awful and is disastrous. That's just, you know -- I don't think that's going to cut it politically.
QUEST: But if we accept that any form of maneuver with health care is highly controversial and is never going to reach consensus, whatever
anybody does, to even getting this far has been an ordeal. Is it likely this Republican bill makes it?
COLLINSON: I think -- here's what the problem is for Republicans. They've spent eight years saying we've got to get rid of Obamacare. They've told
their voters in the grassroots we're going to get rid of Obamacare. Voters have sent Republican lawmakers to Congress, they've given them majorities,
they've given them the White House --
QUEST: Forgive me, I do need to interrupt you. The Health Secretary's speaking at the moment. We need to go an listen to what he's saying, Tom
Price. Forgive me Stephen.
DR. TOM PRICE, U.S. HEALTH AND HUMAN SERVICES SECRETARY: -- policy just because the mandate ended or something happened, it just is not believable
is what we would suggest. And we'll look at the numbers and see.
UNIDENTIFIED REPORTER: Mr. Secretary, without that mandate to buy coverage, would you not concede that millions of people will not have
insurance under this plan?
PRICE: No. I wouldn't concede that at all.
UNIDENTIFIED REPORTER: You would not say millions of people are going to lose --
PRICE: No, because the fact of the matter is they're going to be able to buy a coverage policy they want for themselves and their family. They're
going to have the kind of choices they want. You think about the numbers the top line, just the top line on CBO report today, it basically says that
we'll be right back at pre-Obamacare status with about 40 million people uninsured in this country. We believe that the plan that we're putting in
place is going to insure more individuals than currently are insured. We think the CBO has it wrong.
UNIDENTIFIED MALE: Think about one of the things Tom just said, it bears repeating. The CBO score assumes that if you are on Medicaid today, that
you get off Medicaid after the mandate goes away. Does that make sense? You're on a free program, because the plan doesn't get rid of Medicaid --
QUEST: Stephen, we'll dip out of that. A question for you though, which follows on from what Price was saying -- Secretary Price was saying. This
question of questioning the CBO's numbers, the critics constantly point out that the CBO was wrong on the number of people related to Obamacare that
would be covered and has been wrong in the past. They're going to leap on this as saying the CBO is -- their numbers are in error.
COLLINSON: Yes, they are, and the CBO, where it got it wrong, it got wrong the number of people who would join healthcare exchanges that were set up
under Obamacare. They didn't actually get the headline number wrong, the 21 million, or 20 million, whatever it is. That included a lot of people
who went onto Medicaid, the program for low-income people. So, you can always argue CBO figures. It depends where you sit, of course. If you are
in favor of a bill, you'll say that the CBO figure is right in some circumstances. And vice versa on other occasions. I think what this does,
and you can see, if you're coming out of the White House and trying to nit- pick this report, it does suggest that your political position isn't that strong on this issue. I think that's the big problem for the Trump
administration right now.
QUEST: Good to see you, sir, thank you for coming up so quickly on this one, thank you.
COLLINSON: Cheers.
QUEST: On Wall Street, investors would wait and see ahead of the Fed meeting on Wednesday, a meeting by the way, that just about everybody and
their brother thinks is going to raise interest rates. It's just about unanimity on that view. Trading was light, stocks were flat, the Dow ended
slightly lower. The broader S&P and NASDAQ notched similar gains. One thing to bear in mind for tomorrow trading, New York is going to get the
most awful storm that is going to arrive overnight and it's going to knock the bejeebers out of the city. After a foot and a half, I half a meter or
so of snow is expected to fall over New York, Boston, Washington. So were going to expect a very -- obviously, having an effect on today's trading
and we're going to see more of that tomorrow.
The U.S. Attorney General, Jeff Sessions, gave no warning to the 46 attorneys that they would lose their jobs last Friday. According to a law
enforcement source. Now amongst those who went, amongst the 46 -- actually only 44 I think. Because two were kept on. But one of those that did go
is the Manhattan U.S. Attorney, Preet Bharara. No doubt, he tweeted, I was fired. After he refused to step down or give his resignation. One reason
he said he wouldn't resign is because he believes the President asked him to stay on when they had a meeting back in November. Preet Bharara is very
well known, he once won 85 straight corruption cases.
[16:10:00] Bart Chilton is a former commissioner of the U.S. Commodities Futures Trading Commission, joins me from Ft. Lauderdale in Florida.
Let's go into this. Now look. The starting point in our discussion here, sir, is that all presidents at some time replace those U.S. attorneys that
have been put in place by their predecessors. So, what is so egregious about this case?
BART CHILTON, FORMER COMMISSIONER, CFTC: Richard, you're exactly right. That usually when the new presidents come in, new administrations come in,
they will replace them. Not always. As you say, in this case, they're going to keep two of them. I think the circumstance here is that Mr.
Bharara was told he was going to keep the job, not just by the president but by the attorney general. Then he's summarily dismissed.
So, you know, that raises a question among some of, wait, what's going on here? I mean, this guy, as you say, the U.S. attorney for the southern
district of New York, Mr. Bharara, I mean, he was Wall Street's worst nightmare. If you were getting investigated by him, boy, you were scared
because he has such a strong record.
QUEST: Let's go through that strong record. In 2011, there was the case of Raj Rajaratnam, an insider trading scandal, where Raj was sentenced to
11 years and $93 million fine. In 2013, there was Stephen Curran's company, SAC. capital. Then you have major banks, including recently
Deutsche Bank, with a settlement over tax avoidance.
[16:12:03] I'm wondering, sir, is it your feeling that the new U.S. attorney, whoever that might be for southern Manhattan, is not going to be
-- is not going to put white collar crime as a priority?
CHILTON: Well, I mean, I'd like to look at this from a sort of Pollyannaish attitude, Richard. I'd like to think they would be. But it
certainly raises a question whether or not they will be. How these things work is usually the appointees from a previous administration would stay on
until the Senate confirms somebody new. These people, they have a weird acronym, they are PAS, which is presidential appointment with senate
confirmation, PAS.
I'm so usually, the U.S. attorneys will stay in place until the Senate confirms their replacement. Because what happens is it disrupts ongoing
investigations when they're gone. So, at a minimum, I mean, regardless of whether or not, to your question, the next person is as vigilant out there
fighting to root out corruption, at minimum the existing investigations are going to be disrupted and not just in the southern district of New York,
but as you rightly say in 44 different districts around the country. That's the sort of weird thing about this. I mean, certainly presidents
have the ability to pick who they want to be U.S. attorneys.
QUEST: So really, OK, so does the disruption -- as a result now, everybody waits to see who the new men or women that are put into the post. One name
being mentioned, of course is -- for the New York job is Roger Ailes' former lawyer. And I'm guessing if it was somebody of that ilk they would
have to recuse themselves from what's believed to be but not confirmed, a Fox investigation?
CHILTON: One would think so, Richard. But I don't know, the new normal seems to be that sometimes here ethics and recusal is a tough thing to get.
You don't get it until people beat it into you that you need to recuse yourself. And quite frankly, I mean, even trying to be nonpartisan about
it, looking at the ethical conflicts that we see in this administration, not that there's been anything wrong, but just the appearance of ethical
conflicts, is something that hasn't really seemed to bother the administration.
So, who knows what will happen. My experience 30 years in government, Richard, was always err on the side of caution. Always stay away from
something if there's any possibility of being tainted with impropriety. That's not what's happened so far but I hope it does in this regard.
QUEST: Thirty years in government, sir. You're wearing well on such long service. Good to see you.
CHILTON: Part of the problem, Richard, maybe that's the problem.
QUEST: Never, never. Good to see you, sir. We're going to need your help when all these attorneys get appointed.
[16:15:00] As we continue tonight, a wave of nationalism is sweeping Europe. The Dutch Prime Minister's issuing warning at voters prepare to go
to the polls in Netherlands.
Turkey has just said it's suspending high level diplomatic relations with the Netherlands only days before the Dutch Prime Minister is facing a
national election. Ankara had been threatening to impose sanctions.
(COMMERCIAL BREAK)
QUEST: Turkey has just announced its suspending high-level diplomatic relations with the Netherlands only days before the Dutch Prime Minister
faces a national election. Ankara had been threatening to impose sanctions on the Netherlands after it blocked Turkish ministers from addressing
Turkish expat rallies in Rotterdam. So, you've got the threatening of sanctions, the blocking of officials, the violent protests in both
countries following the decision.
Atika Schubert unless is in Rotterdam. Where the Dutch Prime Minister debated the leader of the right-wing opposition party, Geert Wilders, just
a short while ago. Will take this in sections briefly. Let's start first of all with this deteriorating argument between and row between Turkey and
the Netherlands and there doesn't seem as yet any movement, particularly by the Dutch, to want to patch this up.
ATIKA SHUBERT, CNN SENIOR INTERNATIONAL CORRESPONDENT: No, not yet. I mean, the Prime Minister has paid lip service to the idea. But we haven't
seen any concrete moves to actually de-escalate. He did have a press conference today where he reiterated the steps he took to try and de-
escalate the situation before it ended up in that protest. But at this point, it's still very tense.
(BEGIN VIDEOTAPE)
SHUBERT (voice-over): After Dutch police deployed water cannons and riot police to disperse angry protesters outside the Turkish consulate in
Rotterdam on Saturday night, Netherlands Prime Minister Mark Rutte used a Monday press conference to talk tough on the Turkish diplomatic crisis.
MARK RUTTE, DUTCH PRIME MINISTER: We will still try to de-escalate, but of course to de-escalate needs two to tango. We will never, never ever,
negotiate on a threat.
SHUBERT: This is more than diplomatic blowout. It has become political football playing straight into Rutte's re-election campaign as he faces off
against Geert Wilders, the stridently nationalist and anti-Muslin politician. The candidates are neck and neck. Even before the diplomatic
crisis with Turkey, Wilders told CNN, Rutte's tougher talk on immigration was a pale imitation of the original.
GEERT WILDERS, LEADER OF DUTCH FREEDOM PARTY: Many parties are copying what we intend to do. Everybody's talking. That's a good thing. As a
matter of fact, we won the elections before election day because everybody's talking about immigration, national identity.
SHUBERT (on camera): It is a tight race and the first in a series of game- changing elections across Europe. The first televised debate between the candidates is happening here at Erasmus University in Rotterdam. Here
voters remain divided.
[16:20:04] MAREIKE POPPELARS, 50 YEARS, UNIVERSITY STAFF: I think Rutte will win in the end.
SHUBERT: Why?
POPPELARS: I think he has acted as a prime minister the past few days and I think that is what people need.
UNIDENTIFIED FEMALE: I think it will cause that many people are going to vote for Wilders.
SHUBERT: How would you feel if Wilders became the next Prime Minister?
UNIDENTIFIED MALE: I think it would be terrible. I see it as being part of a larger movement of democracy moving toward populism.
SHUBERT: Rutte is staking his campaign on an appeal to Dutch voters not to gamble with the country's and Europe's future.
RUTTE: Remember the Brexit. We all thought that would never happen. Remember the U.S. elections. So, let's not make that mistake again. These
elections are crucial. Let us stop the domino effect right here, this week, this Wednesday. The domino effect of the wrong sort of populism
winning in this world.
SHUBERT (voice-over): On Wednesday, Dutch voters will get to decide.
(END VIDEOTAPE)
SHUBERT (on camera): Now that diplomatic crisis Turkish president Erdogan had promised the Netherlands would pay. We now know turkey has said the
Dutch Ambassador to Turkey is not being allowed back into the country. It's now up to the Netherlands to respond.
QUEST: Atika, thank you, in Rotterdam. You heard the Prime Minister of the Netherlands talking about dominos. Scotland's first ministers raised
the stakes of Brexit, as the Dutch Prime Minister's warning of populism dominos teetering on the continent.
Let's have our very own dominos. So, voters in the Netherlands go to the polls on Monday. The first dominos start to fall. Well, earlier in the
day the Prime Minister warned of the risks of elections both in France and in Germany. More dominos potentially that could fall. It's already too
late for the United Kingdom. On Monday, Brexit ground forward in Parliament, and whilst you and I are speaking at the moment, MPs in the
Commons have rejected the Lords' amendments and the whole thing is now up to the House of Lords and we are expecting a vote and a bill before too
long.
And then of course you do have the decision by the First Minister of Scotland, Nicola Sturgeon, to seek a second referendum for Scottish
independence. And that of course, if that takes place, we're into the unknown. CNN's Phil Black is outside the Houses of Parliament. Let's
first of all bring me up to date. The Commons rejected the Lords' amendments and has now sent a clean bill back to the Lords. Are we
expecting the Lords to have passed it tonight?
PHIL BLACK, CNN CORRESPONDENT: It looks that way, Richard, yes. The Lords have just voted against one of their own suggested amendments. What we're
talking about here is the very simple 137-word bill that the Prime Minister wants to get through that would allow her to kick start the Article 50
Brexit process. The Lords initially added a couple of amendments. As you say, the Commons rejected them tonight. The Lords has just fallen into
line, voting down one of their own suggested amendments. And it now looks like they're going to do the second as well. It looks by the end of
tonight the prime minister will have the bill she wants authorizing her to trigger Article 50 in the form she would want.
QUEST: And we expect the Queen will sign the next few hours. Any word on when Article 50 would be invoke? We heard perhaps tomorrow, that's now
seeming unlikely. We heard toward the end of the month, that sort of rather messes up the nice party over the Treaty of Rome's anniversary.
BLACK: Yes. So, it could in theory happen as early as tomorrow. But the suggestion from the government today, and they're not being any clearer
than this, it is more likely to be towards the end of the month. Whether or not it does happen around that anniversary that you mentioned before or
after, we'll have to wait and see. The strong suggestion is more towards the end of the month than in the coming days.
QUEST: And Nicola Sturgeon asking her Parliament in Edinburgh to ask for a second referendum, is it likely, I'll be talking to my next guest about the
implications of that, but is it likely from your vantage point at Westminster that the U.K. government in Westminster will accede to a second
referendum in 2018 or early `19?
BLACK: Of course, that's the big question, really. Because it's not just up to Nicola Sturgeon. She's got to get it through Scottish Parliament
first of all, and then through the Parliament building behind me as well. She needs to convince the Prime Minister and the Prime Minister has made it
clear she thinks it's divisive that it's bad economically, bad for Scotland, bad for the United Kingdom.
[16:25:00] I spoke to Alex Salmond, the former first minister, today. The man who made the last Scottish independence referendum take place in 2014.
He lost that referendum, but he seemed pretty chipper today. I asked him how he believes Nicola Sturgeon can convince the Prime Minister that this
referendum should be allowed to happen so soon after the last one. This is what he said.
(BEGIN VIDEO CLIP)
ALEX SALMOND, FORMER SCOTTISH FIRST MINISTER: Well, a bit like I persuaded David Cameron some years back. I mean, that boat sailed. The idea in
those days that Westminster, the Imperial Parliament here, even if they are planning the Empire Mark II, can say to other nations, you shall, you shall
not, have a referendum on national self-determination. Or will do it only in the time scale that we authorize. These days are over, these days are
gone.
(END VIDEO CLIP)
BLACK: So, the view of the Scottish National Party is they have an electoral mandate to revisit this issue because they've always said in the
event that the European -- that Scotland gets pulled out of the European Union against its will, then they should indeed revisit this.
There's a strong argument for that, perhaps. But the Prime Minister doesn't have to accept the Scottish National Party, Nicola Sturgeon's
preferred timetable. They have said they would like to do this toward the end of next year, maybe early 2019. There's a counter argument to that
that says, why don't you wait until the Brexit negotiations are finished and then hold the referendum in the full knowledge of exactly what the
decision is being made. That still ought to be threshed out, Richard.
QUEST: Phil Black at Westminster, thank you, sir.
Quentin Peel is an associate fellow at Chatham House. He joins me now from London. Good to see you, sir. Let's do first of all, let's do the
Scottish referendum. A referendum in 2018 and `19 could not be in a worse time for a Prime Minister who's in the final stages of negotiations at the
same time as about to leave the union in March of 2019.
QUENTIN PEEL, EUROPE PROGRAMME, CHATHAM HOUSE: Yes, I think Nicola Sturgeon really has thrown down the gauntlet to Theresa May. The word is
At Downing Street that they don't think they can stop this process, but they will try to delay it. And both of them are gambling. Because Nicola
Sturgeon doesn't know she can certainly win it. But if Theresa May really delays it or resists it, then it's more likely the Scots will say, to hell
with it, we're going to vote for independence, the English never listen to what we want.
QUEST: Difficult to know where to throw all these issues at you, Quentin. I'm going to lob them. Turkey and the Netherlands. How on earth does the
Netherlands manage to get itself embroiled in such an imbroglio as this one?
PEEL: Well, I'm afraid this is actually President Erdogan in Turkey playing a pretty dirty game. To send his ministers to the Netherlands two
or three days before a very sensitive general election was actually deliberately provocative. And the truth is, the event that Erdogan is
trying to win is a referendum in April. He didn't have to send these people there now. So, he's deliberately provoking the Dutch. And I think
--
QUEST: Why? Why?
PEEL: It's a pretty nasty game. Because it plays very well in Turkey to his domestic audience to say, those rotten Europeans are not allowing us to
have our say, they criticize us. So, he's playing a very strong nationalist card in Turkey. Nothing to do with the Netherlands.
QUEST: But, but, by comparing them to Nazis, even using that word, he's effectively going to destroy any chance of accession talks to the European
Union. Or is that really off the table and anyway irrelevant to his cause?
PEEL: Well, they're pretty well frozen now. I mean, of course ironically this was one of the big arguments in the British referendum campaign. Oh,
the Turks are going to join the European Union. It's not been on the cards now for the last couple of years.
QUEST: Right.
PEEL: Certainly this is going to make it more difficult.
QUEST: And finally, we're running around Europe at great speed. Finally, Wilders or Rutte? The view is Rutte -- Wilders may win but Rutte wins
because he manages to put together a coalition. What's your feeling?
PEEL: I think Wilders has slipped quite a lot in the polls, actually. I don't expect him to win any longer. I think he's going to come second. I
think Rutte will win. And he will put together a complicated coalition. Nobody wants to go into government with Greet Wilders. So, he's certainly
not going to be the next prime minister.
QUEST: Good to see you, sir, thank you very much. In a word, when would you expect the Scottish referendum?
PEEL: I think they'll get it towards the end of 2018.
QUEST: Oy, oy. Nothing like making life difficult for everybody. Good to see you, sir. Thank you very much indeed.
[16:30:00] As we continue tonight, after the break, Intel bet on driverless cars by investing billions into an Israeli tech company in a moment.
(COMMERCIAL BREAK)
QUEST: Hello, I'm Richard Quest, there's more QUEST MEANS BUSINESS in just a moment. When Silicon Valley drives into Israel and no hands are
required. And ride-sharing crashes in Austin. Uber's smaller cousins are overwhelmed. Before all of this, this is CNN and here on this network you
can guarantee the news will always come first.
Turkey said it is suspending high-level diplomatic relations with the Netherlands days before the Dutch Prime Minister faces a national election.
Ankara had been threatening to impose sanctions on the Netherlands after it blocked Turkish ministers from addressing Turkish expat rallies in
Rotterdam.
The first face-to-face meeting between the German Chancellor Angela Merkel and Donald Trump has had to be delayed and pushed back because of a looming
winter storm. The talks were scheduled for Tuesday, now set for Friday. Russia, NATO, trade, and refugees are all expected to be on the agenda.
Al Shabaab militants are claiming responsibility for two car bombings in the Somalia capital Mogadishu. A driver rammed a vehicle loaded with
explosives into a popular hotel. A second attacker drove a mini-bus packed with explosives into the gate of a military training camp.
The Prime Minister of Israel has hailed the takeover of one of its biggest tech firms. Intel bought Mobileye for $15 billion and the software gives
an autonomous car a sense of its surrounding based on data from sensors, lacers and cameras. Benjamin Netanyahu says the deal shows Israel is
turning into a global technology center. Our correspondents in Jerusalem, Oren Lieberman joins me now. I'm going to use the word before you do, sir.
Startup nation. So, a phrase. So, they're always crowing on about being a startup nation in Israel. But why do they want one of their biggest tech
firms to be snapped up by a multinational?
OREN LIEBERMAN, CNN CORRESPONDENT: Well, part of it is that Mobileye will actually be staying here, not far from our bureau here. The hub, the work
that Mobileye has done on sensors and self-driving cars will remain here, it will be Intel investing here. Moving their part of the arrangement.
Let's not forget last summer Intel, Mobileye and BMW signed a partnership to work together to create fully autonomous vehicles by 2021, four years
away. A tough deadline given how far we are from real fully autonomous vehicles at the moment. The tech center will remain here even if it's been
bought up by intel. And that's important to the startup nation even as this sale, $15 billion, blows away the number two sale for a tech firm here
in the, as you said, startup nation.
QUEST: As we're talking about the startup nation, I think the core question is, is there still a feeling that the Israeli technology industry
still has that cutting edge? That all the reasons that created such a vibrant technology sector is still there?
LIEBERMAN: It has its challenges. But I would say the feeling is definitely, yes. One of the challenges facing Netanyahu in and the finance
minister is to keep that here. They've been talking about a lot about the brain drain. That you get these smaller tech firms here that sell out
fairly quickly, then move to either Silicon Valley or to Europe or other tech centers. But it's this indication with Mobileye staying here, that's
what Netanyahu wants to see to keep the tech firms here, especially the big ones. He didn't just say this is an indication Israel is becoming a global
tech center, he said an automotive technology, which is not something you ever hear the startup nation moving into. Normally it's in cyber and other
fields like that. That's one of the challenges, to keep the firms here, even if they sell to big firms like Intel. This is indication Israel still
has the ability to retain that technology, that talent, and that innovation to keep the tech going here.
QUEST: When you're out and about, is there still a feeling of vibrancy, of new kids on the block, those who have come straight from the army with a
good idea, a couple of shekels in their back pocket, and a lot of VC capital from somebody? Is there still that incubator mentality there?
LIEBERMAN: There is very much so. You feel it in Tel Aviv which is the heart of the engine of startup nation. That's where you get three or four-
person startup firms that have just come out of the army. Some of the tech units. 8,200, known as one of the tech areas that breeds entrepreneurs,
that brings innovation to the table. There you see it there you feel it in talking to these guys. Many of them sell out quickly. Many of them make
that exit because they have a good idea, they seize on it, it's picked up quickly by one of the bigger firms. Some hang on and build these firms
until they're bigger firms and that's when you get the big sales. You still feel it. The challenge now, they're trying to create the world's
cyber hub and there are tech centers, their next challenge to take specifically the cyber of that and build it in southern Israel.
QUEST: Good to see you, sir, thank you for staying up late tonight to talk to us from Jerusalem. Oren was talking about the Israeli wish, autonomous
vehicles. The race for driverless supremacy has teamed up automakers with tech giants. You've got the various players behind me there. The all-new
Tesla cars already equipped for fully driverless operations to get on highways. Google has spun off its driverless program into a separate
company called Waymo, it's testing vehicles in three U.S. states. Uber's test driving driverless or autonomous Volvos in California. The company
got into legal hot water with authorities over permits. GM is promising an autonomous Chevy Bolt this year. Ford's investing in self-driving
startups.
Tim Sylvester, chief executive, Integrated Road Race, specializing in custom-built roads for autonomous driving, joins me from South by Southwest
in Austin, Texas. I was reading some of your views earlier. You've got the car. You've got the map that tells the car where it's supposed to be
going. You've got the GPS. You've got the sensors on the vehicle. What are we now lacking in terms of moving to stage 4 and stage 5 autonomous
vehicles?
[16:40:00] TIM SYLVESTER, CHIEF EXECUTIVE, INTEGRATED ROAD RACE: We're lacking the tools that we need to deliver full autonomy. Which
traditionally are provided by a network. In the same way that cell phones require a network or computers require a network. Autonomous cars need
them too. So, by supporting autonomy through the network, we can shift a lot of the technology out of the vehicle ask into the network, making the
vehicle much more affordable, much more reliable, much safer.
QUEST: Right. But you are of the opinion that the idea of the existing data network being sufficient for all these autonomous vehicles is
ludicrous, it certainly couldn't cope, you'd effectively be having a car competing for spectrum bandwidth with gamers.
SYLVESTER: Yes, you're absolutely right. The existing cell networks are completely inadequate. Cell networks are going to be refreshed with 5g
technology over the next couple of years, which depends on distributed antenna systems, das as it's called has a much smaller service area which
makes it very expensive for cell networks to deploy. So, by working with public agencies to deploy the distributed antenna system through the
roadway, we get brand-new roadways that pay for their own existence and natively support the next generation of mobility. In the end, it's not
really about enabling the autonomous car as much as it is enabling the occupants of the autonomous car to do whatever it is they would like to do
while they're traveling within it, which includes productivity, leisure, games, basically anything you might want to do in your living room.
QUEST: So, I always get confused when we start talking about autonomous cars. Because we are -- you've got the cars that need the map so they know
where they're going. You've got the cars that have sensors so they don't hit anything. Ultimately, what for you is the vision of the true
autonomous car? Is it one that relies on an existing mapped area? Or is it one that relies more on just sensors and intelligent vehicle?
SYLVESTER: Well, the sensors are currently very expensive. The cost of the sensors for an autonomous car makes the autonomous car about ten times
the cost of today's average vehicle. So, in order for the average person to be able to obtain one, we need to dramatically reduce the cost of that
vehicle. On top of that you have hailstorms, tree limbs, all kinds of damage that can occur to those expensive systems. So, we think that it
makes perfect sense as these new mobility demands are emerging that we leverage these demands in order to refresh America's infrastructure.
QUEST: Good to see you, sir, thank you for making sense and helping me understand all of this. Keep your hands on the wheel. That seems to be
the best advice I can think of. Thank you, sir.
Uber talking about cars and wheels got a much-needed public relations win in Austin, Texas, this weekend, South by Southwest. The company wasn't
even there. I'll tell you why in just a moment.
[16:45:00] (COMMERCIAL BREAK)
QUEST: A tech festival without some of the tech that many of us rely on. The two biggest ride-sharing firms, Uber and Lyft, pulled out of Austin
last year after a public spat with regulators. Smaller local companies rolled in to fill the began. However, the influx of attendees at South by
Southwest proved too much for these smaller operators to handle. Two of them, I assume they mean technically cracked over the weekend, not
physically cracked. I hope they didn't physically crash. They're back up now and looking to do better. Matt McFarland reported on how Uber's exit
changed drivers' lives. So, what happened here? There's no Uber. There's no Lyft. Tens of thousands of people all with Uber or Lyft with their apps
in their phone, they can't get hold of them.
MATT MCFARLAND, CNN TECH REPORTER: Right. The new players were overwhelmed by the situation. This was the first really big test they had.
These new companies had been operating for less than a year. And South by Southwest was more than they could handle.
QUEST: But that was inevitable, surely, in the sense that these are local operators, aren't they? They're local operators or people who come into
the area but without the sort of national backbone of an Uber or Lyft.
MCFARLAND: It may have been inevitable. Of course, yes, there are constantly growing pains for new companies. At the same time, it is
possible down the road these companies could bounce back.
QUEST: It this behind them, and succeed and thrive.
MCFARLAND: OK, so what are people saying there? Is there a sort of feeling of -- I mean, is it just angst? Is it fury? In Austin, itself are
people sort of saying, for people you've been talking to, we made a mistake to force Uber and Lyft out?
MCFARLAND: The city of Austin voted that they wanted fingerprinting for their drivers. They did not specifically say we want Uber and Lyft to
leave. They wanted a certain security standard. So, at this point it's important for us to remember that the complaints are largely coming from
people outside Austin. Visitors coming to Austin for South by Southwest. Not the locals.
QUEST: Right. But I suppose the gist of what I want what I'm getting at is, is it likely as a result of this sort of incident where people couldn't
get them and people are grumbling that the city would change their laws or accommodate Uber and Lyft better?
MCFARLAND: I don't anticipate the city changing its laws. What is likely is pending state legislation that will do away with this fingerprinting
requirement. Then we will likely see Uber and Lyft return because that is why they left.
QUEST: Good to see you, sir, thank you for bringing that story to us, appreciate it.
A few moments from now CNN will mark the start of my Freedom Day, a day of action by students to bring an end to modern-day slavery. 100 schools
across the world are taking part. The event's all based around a very simple question. What does freedom mean to you?
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE AND FEMALE: Freedom is knowing that you're safe in your own room.
UNIDENTIFIED MALES: For us freedom is having your own will and choosing your own career.
UNIDENTIFIED FEMALE: Freedom to me is meaning the opportunity to live without oppression. Freedom means the ability to live.
(END VIDEO CLIP)
QUEST: So very simple. Very simple and I promise I'm going to do it after the program as well. I want you to Twitter, go to CNN.com/myfreedomday or
tweet me @RichardQuest. #myfreedomday. Tell me in a sentence what does freedom mean to you? We'll be back in a moment.
[16:50:00] (COMMERCIAL BREAK)
QUEST: All this week on QUEST MEANS BUSINESS we're exploring the blurring line between man and machine. It's an increasingly complicated
relationship that you and I have with technology. In the first episode of a new series called "MOSTLY HUMAN," Laurie Segal speaks to a woman who
created a digital version of her best friend after his death.
(BEGIN VIDEOTAPE)
LAURIE SEGALL, CNN SENIOR TECHNOLOGY CORRESPONDENT: Roman was an entrepreneur and months before he died, he had a thought. What if you
could disrupt the idea of death? He recorded his thoughts here.
ROMAN, CHARACTER IN ALMOST HUMAN: I would supply design and innovation to human death. I want to disrupt this outdated industry.
SEGALL: It wasn't long after Zenya fulfilled her best friend's wish. She uses thousands of Roman's texts, Facebook and Twitter posts to create a
copy of him based off his digital footprint. It's called a bot.
ZENYA, ROMAN'S GIRLFRIEND: I've been working on an AI startup the last two years. We've been building artificial intelligence. The program can talk
like a person. I guess I wanted to see what would happen. I had this bot in my phone. I would talk to him sometimes. And a few weeks later I
realized that I'm at a party and texting with my dead friend for the last 30 minutes.
SEGALL: What was it like the first time you texted Roman after he died and he responded?
ZENYA: He got back to me saying, you have one of the greatest puzzles on your hands, solve it.
SEGALL: Zenya agreed to help me build a digital version of myself, a bot. Similar to roman's, she took all my Twitter and Facebook posts, my public
information, and get this, I granted her access to my text messages with my closest friends over the last four years. With all that, she created
Laurie bot. What exactly did you guys do with the information I sent?
ZENYA: We took all the texts, Facebook data, to create a knowledge base of you so that it kind of knows --
SEGALL: You feel like you know me having created my bot?
ZENYA: I definitely have a feel. I feel we as humans decode easily. We can kind of recreate some personality out of just several messages.
SEGALL: We started with an easy question, with a scarily accurate answer. Do I like to cook? I know the answer to this, let's see how my bot does.
I definitely don't like cooking. Oh, my god. My bot just goes, I can't cook, I'm under the impression that you press a button and things show up.
The Laurie bot knew me too well. It also knew my favorite music.
ZENYA: What's your favorite music?
SEGALL: Oh. Edward Sharpe and the Magnetic Zeroes. That's my favorite. That's my favorite song, "Home."
Then things got weird. My bot started to push back on Zenya.
ZENYA: What do we talk about?
SEGALL: What I like, maybe?
ZENYA: What do you like?
SEGALL: That sounds me like, I'm a journalist, be more specific.
ZENYA: Too broad.
SEGALL: My bot is harassing you right now.
ZENYA: It's a little passive aggressive.
(END VIDEOTAPE)
[16:55:00] QUEST: Fascinating. Go to CNNmoney.com/quest where you can subscribe to our newsletter which is out, just coming up at the moment. It
arrives in your mailbox just before the -- just after the close of the New York day. But before Asia opens. We will have Profitable moment after the
break.
(COMMERCIAL BREAK)
QUEST: Tonight's "Profitable Moment." the situation in Europe is extremely complicated. Think about it. You have got the Dutch election
which takes place any time over the next couple of days where Wilders and the Prime Minister Rutte go head to head. You've then got this very nasty
argument, a row between Turkey and the Netherlands, where sanctions and recalling of ambassadors and all sorts of things are taking place.
To confuse and complicate matters more, you have Scotland asking for a referendum on independence from the United Kingdom. All of this at the
same time as Theresa May is about to invoke article 50 and begin the negotiations for the U.K. to leave the European Union. I give you that
recitation so that you can understand where it's going, why it is so complicated, and that whatever is happening in Europe at the moment has
huge potential to be massively disruptive around the rest of the world. Particularly this argument which will spread between Turkey and wider
countries in the European Union. Keep a watch. These are dangerous times.
That's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York. Whatever you're up to in the hours ahead, hope it's profitable. And we'll
do it all again.
END
