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Quest Means Business
Jacob Zuma Survives No-Confidence Vote; "Huge" Turnout in Kenyan Presidential Election; Alt-Right Activists Call for Google Boycott; Trump Warns North Korea of "Fire and Fury"; Anti-Tourist Protest Boil Over in Barcelona. Aired 4-5p ET
Aired August 08, 2017 - 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. Dow Jones Industrials, no records. So, we leave it were we did once
before. No ten for ten. Dow off 31 points. We'll go into the details of what happened. There we go. Short, little and large, a long bell and a
hefty gavel, trading is over around the world. It's Tuesday. It's August the 8th.
President Zuma survives and so do his economic problems. You're going to hear from a businessman who says things haven't been this bad in years.
Kenyans have cast their ballots. The economy is issue number one. We'll look at the results as they come in.
And the alt-right vents its fury at Google after a controversial engineer is pushed out.
I'm Richard quest live in the world's financial capital -- still with a sore throat -- but don't fret ye not, I still mean business.
[BREAKING NEWS]
Good evening, we will have our full business agenda in just a moment but we do begin with President Donald Trump who has warned North Korea of fire and
fury like the world has never seen. I repeat that again. Fire and fury like the world has never seen. After claims that North Korea may have just
become the world's newest nuclear power.
U.S. intelligence says North Korea has something no amount of sanctions could stop -- a miniaturized nuclear warhead. According to an assessment
from U.S. analysts who have not yet reached their final conclusions. There is no consensus yet from the U.S. intelligence community on this. Multiple
officials are telling CNN it's no longer an if, but when North Korea can miniaturize a nuclear warhead.
Now were Pyongyang to deliver such a weapon on an intercontinental ballistic missile. It effectively puts most of the United States in North
Korea's firing range. And all this, after hours after Pyongyang vowed a merciless response to new American sanctions.
So, the events of today, bearing in mind that the revelation of a miniaturized nuclear weapon or potential for that came earlier in the day.
The reaction from the President speaking from his New Jersey golf club a few moments ago. President Trump said he would not tolerate any more
provocations.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: North Korea best not make any more threats to the United States. They will be met with fire and fury
like the world has never seen. He has been very threatening beyond a normal statement. And as I said, they will be met with fire, fury and
frankly power of the likes of which the world has never seen before. Thank you.
(END VIDEO CLIP)
QUEST: The Dow Jones -- not necessarily put into all market positions -- but look at the Dow and see exactly. Now the Dow starts lower. But it
gains during the course of the session and it gives up some gains. And the first little bit of red, that's when the Washington Post reports that North
Korea might have a miniaturized nuclear weapon. But moved to the right of the graph and you'll see the low points of the day. That's when the
president makes his comments. And you could almost time it exactly, 2:30 in the afternoon, New York time is when he speaks -- or the New Jersey time
-- and the market starts to fall and it finishes close to its low point of the day.
As I say, I only show you the market just to put that into some sort of perspective. Clearly, the greater issue is more serious than what the
markets may have done. But it shows the seriousness in the depth of the crisis that now seems to be on Donald Trump's doorstep.
Elise Labott joins me from Washington. We need to parse this very carefully and with gravity. So, firstly, the idea that North Korea now has
a miniaturized nuclear weapon that could be deliverable. Where's this coming from?
ELISE LABOTT, CNN GLOBAL AFFAIRS CORRESPONDENT: It's a DIA, a defense intelligence agency assessment, Richard.
[16:05:00] And we have to be clear. This is one intelligence agency's assessment. This is not the consensus of the intelligence community made
up of 17 intelligence agencies. And the Defense intelligence agency has always been at the kind of forefront of these assessments. So, it is not
the assessment of the entire intelligence committee that North Korea has been able to miniaturize and launch a nuclear tipped intercontinental
ballistic missile.
That said, as we been saying you know, is not a question of if but when. U.S. commanders have said they've been working on the assumption that North
Korea if it didn't have those weapons that it would at some point. And so certainly the threat is a lot greater. But our viewers shouldn't worry
that North Korea is about to launch a nuclear tipped missile at the United States and that it would work. Because there are a lot of other things
that were not sure that they been able to master, which is the reentry of the vehicle into the atmosphere and also hitting the target.
QUEST: The second part of this equation tonight, is Donald Trump's reaction. The phrase fire and fury the like of which the world has never
seen before. We can arguably say would Bill Clinton have said that? Would Barack Obama have said that? Would George Bush have said that? And would
they have been more modified in their words? But how will these words be interpreted around the world tonight?
LABOTT well, it kind of sounds like something that Kim Jong-un would say. Frankly, and I'm sure if we look back into his archives we can see he's
talked about fire and fury. I think the international community will be concerned about this. I also think look, if North Korea will certainly
threaten the United States again. I don't think that the President is saying that if North Korea makes a threat, the United States would act.
If North Korea were to take some kind of launch, of some kind of launch of an ICBM, then the U.S. would obviously mediate with all its military might.
I think you'll probably see some proof provocations from the North. Probably some missile tests. And this is where we get into the danger of
some kind of miscalculation here where this goes a lot further than anybody anticipates.
QUEST: Elise Labott, our State Department correspondent, thank you. We appreciate it.
Tonight, in South Africa the celebration and indignation, depending on which side you are on, after Jacob Zuma, the president, survived a vote of
no-confidence. These were his supporters who were singing out there support even before the result was announced. The vote was held by secret
ballot. The opposition wasn't able to persuade enough members of the ruling ANC party to side with them. And afterwards, the president had this
message for his detractors.
(BEGIN VIDEO CLIP)
JACOB ZUMA, PRESIDENT OF SOUTH AFRICA: Now they believe they could lose technicalities in Parliament to take over the majority from the ANC. It's
impossible. They can't do it. We represent the majority in the public.
(END VIDEO CLIP)
QUEST: Our correspondent David McKenzie is in Cape Town. David, it was always going to be close and potentially the result as it was. But why do
you think enough ANC-ers didn't cross, bearing in mind it was a secret ballot?
DAVID MCKENZIE, CNN CORRESPONDENT: Well Richard, obviously, the ANC managed to whip its members into shape to get enough of them across the
line to support Jacob Zuma. What was really fascinating to see in that debate before that vote though, Richard, was you didn't see a full-throated
defense of the embattled President. In fact, some of those debating on the ANC side didn't even mention the president by name. It was more them
saying that this was an attempted palace coup. That it was an attempt at regime change.
So, just in that you see that the President doesn't have that kind of full throated support that he had in the past. And you did have the significant
number of ANC MPs crossing across to the other side. Maybe as many as 30 of them, and that's very significant for the political future of President
Jacob Zuma though he did survive tonight -- Richard.
QUEST: So, he survives tonight. He's been censored in the past by the country Supreme Court. He's had to repay money back for work done on his
house. And the general feeling is that there's more dirt there to be uncovered.
[16:10:00] But the point, David, is at what point will be ANC -- or maybe they won't -- say it's time to move on from Jacob Zuma?
MCKENZIE: The short answer to that is I think it will come down to the elective conference of the ANC in December, where they should come up with
an heir apparent two Jacob Zuma for the party and then de facto for the country, or at least for the presidency if the ANC wins the next election.
But what you're seeing is these fractures within the ruling party, the party of Mandela. A party that traditionally has been able to show extreme
loyalty in these circumstances. And as you say, with these endless seemingly allegations of corruption dripping out day by day in the South
African press and elsewhere. You do get a great sense that the pressure is piling on, on Jacob Zuma. And it won't stop just because of today's
results.
QUEST: David McKenzie in Cape Town. Thank you, David.
While President Zuma may breathe a sigh of relief, his country's facing issues that could stretch long into the future. So, this year alone, South
Africa fell into its second recession in eight years. The unemployment number is at 27 percent. And the country's credit rating has been
downgraded to junk after a loss of confidence following the firing of the finance minister, Pravin Gordhan.
A few hours ago, defiant, President Zuma cried, you can't touch the ANC. And by the look of his career he seems to be right and untouchable. It's
the ninth no-confidence vote he's survived. Whatever parallels you might draw from nine lives, this is certainly not the first time he's landed on
his feet.
He once faced at least 15 years in jail. It was a scandal linked to an arms deal signed in 1999. In 2016 South Africa's top court said he defied
the Constitution after using $15 million of state funds to upgrade his private home. A year later his relationship with the wealthy Gupta family
was under serious scrutiny. And this year his axing of finance minister, Pravin Gordhan, caused the markets to tank and around to fall.
ANC politicians are already looking for a future with Zuma whose term ends in 2019. Peter Norton joins me. The founder and managing director of CLF,
a multimillion dollar South African construction company. He's in Cape Town. How bad is it for you?
PETER NORTON, FOUNDER AND MANAGING DIRECTOR, CLF: Richard, it's I could say, after today were still little disappointed, but also quite excited
about what's happening with the political regime. We've seen some moves toward clearing the fog in the business environment.
From a business perspective, we're looking for some clear policy direction. We want to see what's going to happen in the country in terms of, would you
be able to buy minds? Would you be able to buy farmland? We want clear policy from the government. We want to see a lot less corruption. We want
to see a lot less administration and nepotism within the governing party. We're not opposed to ANC rule. We just want to see decisive ruling and
clear policy and clear decision-making for the population.
QUEST: On my various visits to South Africa in recent years, the view seems to be -- or at least one view that I've heard -- is often that the
business environment is not only getting tougher and harder, it's getting worse. Would you subscribe to that?
NORTON: I think from our particular business involved in cement and concrete, it's probably flat year on year. But generally, I think
businesses facing some tough times. We've got unemployment in the region of 27 percent. We've got static foreign investment. We've got a lot of
domestic capital waiting to be invested in the local economy. The people are tending to sit on their hands. There a little nervous. As I said,
this lack of policy.
QUEST: If we take the Western Cape where you are, where the Democratic Alliance, the DA, has managed to make great inroads. But those inroads,
and yes, through a certain local election in Johannesburg last year that also had inroads. But there doesn't seem to be a realistic opposition yet
to the ANC, nationally. Would you agree?
NORTON: No, I think the ANC is under tremendous pressure both from the Democratic Alliance and smaller parties, the EFF, the IFP, UDM. There are
a number of smaller parties which are starting and gathering momentum to threaten the once dominant ANC.
[16:15:00] And I for one my opinion is that we may indeed in the not too distant future see the ANC falling from its position of majority power.
QUEST: Will you be watching closely, as a businessman, for example, at the ANC December conference, when effectively they anoint or at least appoint
an heir apparent to Jacob Zuma? And do you have a view on who you would like that person to be?
NORTON: We don't particularly have a view. The popular choice is sitting with Cyril Ramaposa. He's currently deputy president. As I said, the
business community is not typically -- or is typically apolitical. We're not anti-ANC. We would like to see the ANC, if they do lead this country,
to get their house in order and primarily get someone of decent leadership who can lead a once very prestigious political party. Lead this country to
where it can become. It is an exciting enjoyable place to live with lots of opportunity for lots of wonderful people. So, we just want to see some
clear and good leadership.
QUEST: Peter Norton, thank you. Always enjoy my visits to South Africa. Thank you, sir, for joining us.
Now, to Kenya. The voters have decided who will their president be. Voting's been brisk. The election that hinges on the country's economy.
(COMMERCIAL BREAK)
QUEST: As you know, voting is finished and counting is now underway. The ballot box is being counted in Kenya, where monitors say there was a huge
turnout on today's Tuesday's presidential election. Long lines at the polling stations across the country. And the top two candidates both
promising to create jobs and make the economy more fair.
Now, you have the incumbent, Uhuru Kenyatta. For the incumbent, the focus is on inequality, while the economy is growing at a decent clip, the
poverty rate is still 40 percent. And President Kenyatta says he will reduce the cost of living.
The challenger is Raila Odinga, and let's not forget of course, former Prime Minister. And these two men have done battle before in the last
presidential election. So, there is no love lost between the two candidates in this election.
The recent drought has push prices higher. And Odinga wants to help programs, new programs that will help the hungry and to protect farmers.
CNN's Farai Sevenzo, is in Nairobi and joins me now. All right give me an idea from the results were seeing, what's it looking like?
FARAI SEVENZO, CNN CORRESPONDENT: It's too early for that, Richard. I'd like to give you an idea, but it's way too early. It is way too early.
What we know, is that a quarter of the results have been going through the tallying center. That's a quarter of the polling stations.
[16:20:03] So, there is another perhaps 30,000 polling stations to declare, and we are very cautious, as you know, on our network. And we will wait.
Twenty-four hours' time I will be able to tell you who it is. But is true the voters went around the block. It is wonderful to see democracy in that
kind of action. If you wonder why Kenyans are doing it? It was cold, it was wet, it was raining and they were there all-day long. Sometimes
waiting for six hours to cast their votes. That's how important this election is to them, Richard.
QUEST: At the end of the day, as I said my introduction, there's no love lost between these two men. They both are promising to do something toward
hunger, poverty and equality. Is there really a dramatic policy difference that Kenyans will notice if one wins versus the other?
SEVENZO: None that I can tell, to be honest. It is a free market economy. There is a great deal of infrastructure going on. They just bought a $3.8
billion railway from Mombasa to Kenya, which is call the Madaraka Express. And all of these are signs of great wealth. But the problem is quite a lot
of these voters are very young people who have been spewed out of the education system to no jobs.
And indeed, there's also that issue of corruption. The C word is big and Kenyan politics. And one man would say, no, they want to eradicate
corruption and make sure that everyone has a fair deal. Another would say, no, I want to carry on the job I've started and bring more prosperity. But
it's very hard to see, because I think there's a big difference between the older voters and the younger voters. And the younger voters want to
completely different political system as far as I can tell from the people I was talking to today.
QUEST: It's fascinating stuff. The interesting thing here is -- again, we end on a high note here -- that the democracy, the will to go in cast a
vote was absolutely seen throughout the country.
SEVENZO: It was incredible to witness. I've seen many African elections and none took me by surprise as the Kenyan one. It was democracy in action
as you said. And of course, Kenya is a very important part of this region. If Kenya catches a cold, then all of East Africa will have sneezes for the
rest of the year. It's because all the landlocked countries rely on Kenya's economy. South Sudan, Rwanda, Congo and is very, very important
that this goes well
QUEST: Good to see you, Farai. Your picture was taking a couple of color hits on the way you were looking a bit green at various points and now
blue. But it's so important that we have stayed with you throughout, because we really do need to hear what is happening in Kenya.
Let's turn to the chief executive of Barclays, Kenya. He says the country's focused on a peaceful outcome to the vote more than anything.
Jeremy Awori joined me earlier and told me he's confident about Kenya's business climate, whoever wins in the next 24 hours.
(BEGIN VIDEOTAPE)
JEREMY AWORI, CEO, BARCLAYS BANK OF KENYA: Clearly, there's a lot of competition from neighboring countries. But what we focus in on is what is
our own competitive advantage. We're putting in institutions, frameworks, legislation and regulations that we believe will be competitive and pro-
business. And I think once you have those institutions in place, irrespective of election outcomes, it becomes pro-business in the longer
term. And I think that's what's important for the country, irrespective of election outcomes.
QUEST: That's always the old argument, isn't it? It doesn't matter who wins that business carries on. In the sense of what does business fear?
Now obviously, you have your finger very closely on pulse of what companies want or borrowers want. The supply of credit within the economy that will
enable their growth to take place. What's your fear that could happen here?
AWORI: I think really as business you fear disruption to running your business. So, if anything really comes in the way of stopping you running
your business or making it more complicated to run your business to access markets and to grow. That obviously, has a negative effect on the private
sector. We're a free market economy without many controls. So, if anything interferes with those free markets conditions that will have an
adverse impact on the economy. But we don't believe that that situation exists in the Kenyan context now. People understand the importance of
having an open liberal economy that allows for growth and encourages businesses to be able to perform.
QUEST: And we end on a very positive note I think, tonight, you and myself. Whatever the result, clearly, the way the election has been -- or
least at first glance -- the way the election has taken place has been a model, free and fair.
[16:25:05] People have waited for hours to vote in the rain. Let's finish with this, sir. Give me a mood tonight. What's the mood in Kenya? Having
had an election where everything seems to have gone well.
AWORI: Yes, I mean, what really came across today was that Kenyan showed out in great numbers. They were patient. They were peaceful. They
express their vote. And now I think everybody's really waiting and seeing the process of the tallying going on. So, obviously, people are looking
forward. And I think by tomorrow hopefully will see a better idea of which way the results are going. So, I think people are still optimistic. They
are hopeful. But if anything, people want a peaceful outcome to this election. And that's where everyone is focused at the moment here in
Kenya.
(END VIDEOTAPE)
QUEST: And we'll be watching the results, which will come in the next few hours as Farai Sevenzo was telling us a moment or two ago.
Now, U.S. markets, fascinating. It starts the day down, but there is definitely a momentum that's pushing the market higher. And about 10:45 it
does go up. But this is where "The Washington Post" first described the potential for a miniaturized nuclear weapon from North Korea. And this is
where Donald Trump pretty much makes his comment about fire and fury like the world has never seen. Now, can we tie that -- that seems to be the
reason why the market went down. U.S. markets all dipped into the red before the closing bell, and it was indeed -- it would seem to be both the
Dow and the S&P 500 reached intraday highs during the session. It would have been the Dow's 10th record into a close. It would have been, but it
wasn't, because it didn't. So, it couldn't. If you get my drift.
Paul La Monica, Disney's earnings are out. What's happening?
PAUL R. LA MONICA, CNNMONEY CORRESPONDENT: Disney's revenue missed forecasts and the stock is down.
QUEST: Badly?
LA MONICA: Not badly, a little bit, but you still have problems at ESPN. Concerns about the ad revenue, about the lower subscribers. That's an
issue. The bigger news, Richard -- and this isn't enough to boost Disney's stock -- Disney also announced separately that they are going to start
their own streaming media subscription service. And they will pull starting in 2019 a lot of Disney branded content from Netflix and put it on
the new Disney service. Netflix's shares are down more than Disney after hours on that news.
QUEST: Just on the back of that.
LA MONICA: Just on the back of that. Because when you think of Netflix, Netflix obviously has a lot of their own shows that are big hits, but they
also rely on big media companies like Disney and ours, to feed them content as well. Netflix can be steam hits.
QUEST: But consumers surely aren't going to subscribe to the Disney stream, and the NBC stream, and somebody offers a subscription-based model.
LA MONICA: You do have to wonder if we get to a point where consumers are fatigued. You have Netflix -- as far as I'm concerned, Netflix offers
almost everything that my wife and I and my children want. Do I also need the new Disney service? And Hulu, and Amazon, it's a lot of options.
Plus, we still have cable. I guess I'm a sucker, because I'm spending all this money to watch TV.
QUEST: I must be the only person that you probably know that doesn't have a Netflix subscription. Can I borrow yours? Since the rest of the
families all using it.
LA MONICA: Exactly, everyone's sharing password. Why not? I'll set up a little icon for you on my app.
QUEST: I can't believe we just said that on air. I could feel our legal department.
LA MONICA: Is Jeff Buchs watching?
QUEST: Jeff who? After the brake. Google's chief executive was on holiday when the diversity took hold. Well, he's not on holiday anymore.
Now Sundar Pichai is back at the office and the engineer who started this whole sorry mess is gone.
It's QUEST MEANS BUSINESS, good evening.
[16:30:00] (COMMERCIAL BREAK)
[16:31:27] QUEST: Hello, I'm Richard Quest. There's more QUEST means business in just a moment. When the alt-right calls for a boycott against
Google.
And some see slashed tires. Anti-tourist protests our boiling over in Barcelona. As we continue tonight, this is CNN and on this network the
news always comes first.
South Africa's President Jacob Zuma has defeated another no-confidence vote against him. Opposition members held a secret ballot. It failed to get
enough. ANC party members decide with them. Mr. Zuma's been embroiled in a corruption scandal. This was the eighth attempt to remove him from
office.
In the U.S., a new CNN poll shows President Donald Trump overall approval ratings stands at its lowest point in CNN polling. Thirty-eight percent
saying they approve of handling of the presidency. Three-quarters of Americans polled, said they don't trust what's coming from the White House.
U.S. President says North Korea will be met with fire and fury like the world has never seen if it keeps threatening the United States. The
warning, which is the strongest yet from Washington. It follows U.S. intelligence analysts who say that North Korea has likely produced a
miniaturized nuclear warhead that it could put on a missile. That's not a firm conclusion from the entire intelligence community. The North
threatened physical action in the response to the new UN sanctions.
CNN's Will Ripley is in Beijing for us tonight. Will, how will China -- I mean there's two things to look for here. Firstly, how China reacts to the
idea that North Korea has an ICBM, or a miniaturized weapon. But perhaps more significantly, Donald Trump's comments about fire and fury.
WILL RIPLEY, CNN INTERNATIONAL CORRESPONDENT: Absolutely right, Richard. Every time that there's a provocation from either side, China is the one
kind of standing the middle saying, everybody remain calm. They think the United States shares the blame for escalating tensions on the Korean
Peninsula for their joint military exercises with South Korea. And now, this kind of rhetoric from a U.S. president, well it certainly plays into
the long standing North Korean narrative that the United States is preparing to invade. And North Korea feels completely justified at
developing weapons of mass destruction, because they tell their own people that the United States could start another Korean War at any moment.
And so, you can bet North Korea will broadcast those words inside the country as further proof to their people that even if they have to undergo
even more hardships as the result of the sanctions over there missile program, that their leader Kim Jong-un has no choice. Because the United
States President that leads the country, the only country that ever drop nuclear bombs on civilians in Japan at the end of World War II or ending
World War II. That the United States President is threatening to rain fire and fury like the world has never seen on North Korea.
QUEST: All right, Will, an unfair question to you, and you can throw it back at me if you so wish. Which will the government in Beijing be more
concerned about Kim in North Korea, with his ICBMs that may or may not work and bellicose messages, or Donald Trump in the White House with his fire
and fury?
[16:35:00] RIPLEY: Both are equally alarming for different reasons. We know that China is worried about the ICBM program. Because for the first
time ever China approve this seventh round of UN Security Council sanctions after a North Korean missile test. In the past, China would only approve
sanctions if it was after a nuclear test. So, the shows they are concerned about the rapid progress that North Korea is making. And of course, these
reports from sources that they have successfully miniaturized a nuclear warhead, which analysts had predicted would only be a matter of time
anyway. Perhaps just a matter of months before they could deliver that warhead reliably to the mainland U.S.
But they are also concerned this kind of language from the U.S. president, because they just don't know what he is capable of doing. And what China
fears is that one misstep on either side -- because North Korea is used to firing rhetoric. Now you're having this kind of fiery rhetoric from the
United States. And if either side does something that creates a chain reaction, that is the fear for all stakeholders here. Because nobody wants
a war. War would be catastrophic. North Korea doesn't want it. The United States doesn't want it. China certainly doesn't want it. But if
someone makes a mistake and it starts that chain reaction then you might find yourself in a position where it's really unthinkable of what could
happen. It would be truly catastrophic.
QUEST: Will Ripley in Beijing. Thank you.
The sacking of that Google engineer who asserted women are biologically unfit for certain tech jobs has caused a backlash. He was denounced by top
executives but found support in right-leaning corners of the online media world. "The National Review's" Robert Vernigan said of the controversial
memo, it makes entirely legitimate points. The "Weekly Standard's" Jonathan V. last said it is a rational case of the worst excesses of
corporate identity politics. And Charlie Nash of Breitbart asserted numerous psychologists, male and female, deemed the manifesto to be
scientifically accurate.
Google's chief executive did not agree. He is returning home early from his vacation to deal with the crisis. Danielle Brown, Google's new head of
diversity, protected her Twitter account, it means you must send a follow request before you can read her tweets.
Kate Mitchell is cofounder Scale Venture Partners and she joins me now from San Francisco. My word, what a mess. But here is the really difficult
thing, there are two issues here that we just need to get to grips with. Firstly, how prevalent is this view? As a woman, on the West Coast, in the
industry, how prevalent is the view do you think that this man expressed in his manifesto?
KATE MITCHELL, COFOUNDER, SCALE VENTURE PARTNERS: It is interesting that we are just following a story on North Korea and the U.S. where we are
talking past each other, and not with each other. I think there is a huge analogy there, luckily, we don't have nuclear bombs, nuclear warheads on
each side. I think it is not prevalent but it is certainly existent.
So, I do think it exists. I think it is quite minority but I think it is important that we understand that it is there, and I also think, figure out
how to engage in a conversation with folks like that. I think that is an important part of how we get to the solution.
QUEST: OK. But that's the difficult part. Because if you read the manifesto, and you see those people who do agree with it, you are left
thinking, well, hang on, was it right for Google to fire him. I am assuming he was fired, seems to be as he is now claiming. As I have
written in my newsletter tonight, Voltaire said I disagree violently with your views, but I will fight to the death for your right to save them.
Well Voltaire clearly wasn't running Google.
MITCHELL: It is interesting, I was going to quote Voltaire if you weren't, Richard. I think it is absolutely the right thing and as Americans that is
what we stand for. I don't know the circumstances of whether or not he was fired and would Google's decision was, I think when we think about
diversity it's important that this is not an or, it is and. When we talk about diversity it includes people of all races and colors, including white
conservative men who may have these kinds of concerns. We are better when we have everybody at the table not just one type of person. So, I think
it's unfortunate that it certainly appears that he has been banished because we do want to engage in conversation. I think that is a fair
question for everybody to ask, it is an opportunity to talk about.
QUEST: This liberal bias, let's put the biological diversity issue to one side for a moment, this liberal bias that he writes of in Google, that
assumes the liberal agenda is the correct agenda, the only agenda. Some might arguably say the arrogant agenda but this is very similar to what
Peggy Noonan was writing about in the 1980s when Ronald Reagan was elected.
[16:40:00] MITCHELL: And this is the issue, think of diversity as something that is a political issue, we are going to get sidelined on both
sides of the table. When we start thinking of it is not just good but a smart thing to do. It's how you increase value and how you solve problems
better, and it is diversity in every dimension. Age, school, ethnicity, where you were born, where you went to school, is going to make a huge
difference in increasing the success of what you do.
And when we think about first principles which he touches on as a manifesto but then kind of wanders off into a stereotype of his own. I think we
figure out how to take some of the essence of what we really want to get done here which is improve outcomes. It is not a right or wrong, it is not
a moral issue, it is a smart business decision.
QUEST: Good to see you, thank you so much, really appreciate.
MITCHELL: Thanks, Richard.
QUEST: As we were alluding to the fact of the newsletter, there we are, Voltaire and Google. You can sign up for the newsletter@cnnmoney.com/quest
which is what we will be talking about or what we will be writing about tonight.
Coming out after the break, Once, upon a time a British travel show on TV was called "Wish You Were Here". I remember it well. These people wish
you weren't, the Spanish Prime Minister calls for calm after a wave of protests against Europe, against mass tourism. This is QUEST MEANS
BUSINESS good evening to you.
(COMMERCIAL BREAK)
QUEST: The Spanish Prime Minister is now trying to quell recent violence that is directed at tourists. Mariano Rajoy has been quoted as blaming
radical extremists. He says it seems crazy to kick people out who wants to spend money in your country. It's not just Barcelona though, locals in
places like Barcelona say their cities are becoming unlivable. Tourists are pushing up rents particularly if you are in an Airbnb component to all
of this. Barcelona is hot or is hot to go and visit, and now there is overcrowding.
So, the city is considering a tourism tax, also, I am not entirely certain how a tourism tax deals with the overcrowding. But then you have other
places, last month in Venice, the Venetians were waving suitcases marked against uncontrolled tourism. And for instance, in Rome, the city is
considering capping the number of daily visitors at key attractions like the Trevi fountain, anyone who is been there knows you've got the battle
through dozens of people before you can finally throw your coin into the fountain and make your wish.
[16:45:00] And then in Croatia, there are plans to limit the number of cruise ships visiting Dubrovnik. The number of arriving is so great that
effectively it overwhelms the town. Tourism makes up 11 percent of the Spanish economy, it is a major part.
Gala Pin is a district councilor in Barcelona, and hopefully you can hear me now. Can you hear me?
GALA PIN, DISTRICT COUNCILOR, BARCELONA: Yes, I can hear you.
QUEST: excellent
PIN: Can you hear me?
QUEST: I can indeed. The issue for Barcelona as far as I can remember, tourists have always to some extent been suffering from being attacked or
robbed or petty theft but this latest increase in tourist numbers, how serious is it?
PIN: I would say Barcelona is a very safe city and that people actually think that Barcelona is a safe city, and that is also one of the reasons
because we are visited. And we cannot make a theory about an anecdote of attacks against tourists. Isolated facts, we have condemned it. But they
do not represent the majority of the residents of Barcelona.
QUEST: Right, now, as Barcelona deals with this, the other side of this coin is the sheer numbers, the popularity of Barcelona. How worried are
you that there are too many tourists, and local residents, citizens your constituents are getting angry?
PIN: We can say that there are residents, and there are different neighborhoods where people are unhappy with the model.
QUEST: We have appeared to. The screen appears to have frozen which is highly regrettable. But I think we just lost that connection, but there we
go we got the idea of what we were talking about. As we continue tonight, on Quest Means Business it's not always the case but currently there is a
good service running on all lines here at CNN headquarters in Columbus Circle. Now, New York's Mayor wants millionaires to help things run
smoothly on the subway. The city's controller joins me next. Listen to this.
[16:50:00] (COMMERCIAL BREAK)
QUEST: This is this morning's "The New York Times" and on the front page, there is the story, packed trains create cascade of peak delays. The
nation's most crowded subway line is jammed every morning. Well, $700 million, that is how much New York's Mayor Bill de Blasio is hoping to
raise from millionaires to fix the city's subway system. New York, as this paper makes clear, is currently in the middle of a summer of hell. There
are signal problems, overcapacity and frequent breakdowns that make the daily commute simply a nightmare.
The delays have affected low-wage workers the most. So, let's put this into perspective. Firstly, on the question of the millionaire's tax isn't
going to work. Secondly, why is the subway in such an appalling condition. Scott Stringer is the New York City comptroller. Good to see you, sir.
SCOTT STRINGER, NEW YORK CITY COMPTROLLER: Good to see you
QUEST: Is the mayor's millionaires tax ever going to happen?
STRINGER: Here is the problem, we are having a summer from hell. A subway system in New York City is on the verge of collapse, so when the mayor
proposes a millionaire's tax it is one of several interesting long-term ideas that we should explore. The problem now is that we can't wait for
the legislature and the governor to decide whether to support that. We have an $800 million emergency repair plan that needs money now.
QUEST: Where is that money going to come from?
STRINGER: It has to come from a number of places. First, Governor Cuomo has said he will find half of the 850 million, and I have said as city
controller, the chief fiscal watchdog, that the city should also make an expenditure so that we can repair the tracks, we can fix the signals, and
we can get our system moving again.
QUEST: A couple of months ago, I was reading some articles in the Times which compared New York and London, which I know particularly well, I am
sure you do too. The London tube, a huge amount has been spent over the public and private partnership. And the thing is working remarkably well
on a network that is almost as overcrowded as New York's.
STRINGER: London, Tokyo, Seoul, you name it, every big city recognizes that the more you invest in mass transit, the better the economy. We in
New York City stopped investing in the subway system.
QUEST: Why? Because it's not like the 70s when it's all graffiti, go back to the 90s and the 00s, and the good years why wasn't the city investing?
STRINGER: Because I think complacency set in, it was easy to stop investing and put money in other places. We made a terrible mistake 20
years ago by stopping this investment. But look, we have a crisis and we have to invest, so that is what the fight is about now. I think the city
and the state should get together, the mayor has some good ideas, the governor has good ideas, obviously, there is a lot of politics at play.
Look, I watch the money and the bottom line, we have to invest, invest, invest if we are going to continue to grow the greatest economy in the
world.
QUEST: And you have got the money to make your contribution to this?
STRINGER: The city can afford to make a payment. The state must make a payment. But look, it's not a blank check, the MTA is a black hole. We
have seen mind disappear there with no accountability and no transparency.
QUEST: Let's talk about the MTA with its new boss. It is a vast organization, isn't it?
STRINGER: Well, it's a vast organization that has also been rife with disorganization. So, chairman Lhota, he has put together a smart short-
term plan. We need to think about a long-term investment plan in mass transit. But here's the deal, if the mayor were to give money to the
bailout plan, it has to be try to transparency. I believe that there should be a memo of understanding that says look, here is our contribution,
these are the projects we want done, and that is how we move forward.
QUEST: It is fortunate tonight that we are able get into this in some more detail because what I understand you to say, look, I have to say my commute
here and down to the stock exchange is really quite straightforward. And as long as it goes well, it goes well. But if it goes wrong, it is hell on
wheels.
STRINGER: Look --
QUEST: How do you put together a crisis plan at the same time put in place an infrastructure plan that you and I know will take five, 10, 15 years to
come to full fruition?
STRINGER: We know we can do it because we have done it before. When the subway system was on the verge of collapse, we had a long-term capital plan
that eventually worked. We have to go back to the drawing board and do that again. What we have to invest the money now because we can't wait.
The Lhota plan is a short-term plan. We need better tracks, we need new subway cars, we need signals. Put that in play now. Long-term, we have to
really revisit how we are going to have a structural funding stream for the MTA.
QUEST: This is fascinating because what you are really saying is that we need to go back to some form of vision of the Victorian infrastructure
building that leaves something for future generations. If you look back at this city and indeed the bridges and tunnels, same in London, it was all
spent a long time ago.
STRINGER: Nobody, no politician wants to invest in infrastructure.
QUEST: Except the president.
[16:55:00] STRINGER: He doesn't either. He pretends he does. But visionary elected officials know that infrastructure is something you think
about and you look back and say, I'm glad we did that because now 10 years later we made a difference. And every big city in America, every big city
around the world is now investing in mass transit. We should lead the nation.
QUEST: And we are glad you came in to talk about it, sir, thank you. I appreciate.
Now, if you want another chance to enjoy you can download our show its podcast, it is available from all the major providers and you can listen to
it at cnn.com/podcast. We will have a Profitable Moment after the break.
(COMMERCIAL BREAK)
QUEST: Tonight's Profitable Moment, we had just had a fascinating discussion with the head of New York's comptroller on the question of
infrastructure and the New York subway. Now, infrastructure is very much on the agenda because President Trump promised during the election $1
trillion's worth of infrastructure spending which he said was necessary to help make America great again. To repair the bridges, the tunnels, the
roads, the railway infrastructure, to say nothing of the airports. And even if several billion are being spent for example at LaGuardia here in
New York, the reality is that the subway is in a pretty awful state.
Overcrowding, delays, cancellations. And you're left wondering at what point are we as societies going to spend the necessary money to improve the
infrastructure that helps economic growth in our capital cities. Put it another way, think about it like this, the Victorians built the bridges and
the tunnels, they spent the money because they had the foresight. But as the comptroller says which politician today wants to say that he has that
foresight. There are no votes in infrastructure in 10-years' time. That is why you need something with a little bit more oomph.
[17:00:00] Spend the money now. And that is QUEST MEANS BUSINESS for tonight. I am Richard Quest in New York. Whatever you are up to in the
hours ahead, I hope it is profitable. I will see you tomorrow.
END
