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Ireland Holds Fiscal Treaty Referendum; Greek Lawmakers Vote on Deeper Cuts; Aside from Athens, European and US Markets Up Slightly; More Than 1,000 Stuck on Cruise Ship Without Power; One Woman's Children Involved in Both Costa Incidents; Effect of Two Mishaps on Costa and Cruising Industry; Fukushima Report Shows Japan Withheld Risks of Nuclear Disaster; Inside Fukushima; Putin Facing Stiff Competition in Russia; Oil Prices Going Down

Aired February 28, 2012 - 14:00   ET


MAX FOSTER, HOST: A referendum. The people of Ireland will get to vote on Europe's fiscal pact.

A company in motion. The makers of BlackBerry tell us about the tough lessons of the last year.

And echos of gecko. The FBI enlists Wall Street's favorite villain to help fight corruption.

I'm Max Foster, this is QUEST MEANS BUSINESS.

Hello to you. The people of Ireland are getting the power to say no to Europe's new fiscal treaty. Prime Minister Enda Kenny told Parliament today a yes or no referendum will be held within weeks. Ireland's top legal officer has told Mr. Kenny that the Irish constitution demands citizens have a say.

The fiscal compact calls for tighter budget discipline amongst EU member states. The EU and the Czech Republic have said they won't sign up for the plan. Shane Ross is an independent member of the Irish parliament. He joins us on the phone from Dublin.

Thank you so much for joining us on this. What do you think the result will be, from what you've gauged?

SHANE ROSS, MEMBER OF IRISH PARLIAMENT (via telephone): Given the opinion polls at the moment, they're running very, very, vaguely in favor of the government. In other words, of a yes vote. But they're -- these are only straws in the wind.

Normally when we have opinion polls on European treaties, they usually are in favor of the government, in favor of the treaty to start with. But the trend has always been to move backwards and against them as the campaign goes on. So, I think it'll be extraordinarily tight.

The main political parties, that's Labour and Fine Gael, the government's parties, and the main opposition parties, will be in favor of this referendum, but there'll be very vocal groups against, and that in the past has proved enough for a no vote to referendums.

FOSTER: You're part of those groups, of course. What will your argument to voters be?

ROSS: Well, the group I'm a member of is independents, they're not all guaranteed to go the same way because they're independents.

But I think the argument will be that this is -- the argument to vote against will be that if this is going to be a vote for austerity, because Ireland has been practicing some very, very strict, tough measures in recent times, and those are seen by many here to be dictated by the EU and dictated by Angela Merkel and Nicolas Sarkozy.

And I think those opposed to this referendum will say that we've had enough of being told what to do by the Germans and by the French and by their bankers and bailing out their bankers, and we want to put an end to it, and this is one way of saying enough is enough, we're not going to vote for austerity anymore, we want to get concessions on the debt rather than further austerity and tough budgets.

FOSTER: It's an interesting story, this, isn't it? Because Ireland has always, well, in the past, has gained so much from being part of the EU. It's seen as a real EU champion. This isn't the voice of Greece, this is a voice of a central part of the European Union. Do you think this is very telling of the state of the European Union?

ROSS: I think so. Ireland is very pro-European for the reasons that you've given, certainly. But at the moment, the Irish government and the Irish people, I think, have a different perspective on this.

The Irish government, which was only elected last year, came in and said that they would renegotiate the deal with the EU and the IMF. They didn't do that, and the Irish people rather expected it.

And the Irish government, which is still being extremely pro-European and, as a result, by the way, is very popular at the top tables in Europe, is somewhat detached from the view of the people, who are feeling the austerity measures and are blaming Europe for it.

So, it's going to be a very interesting campaign, with the government campaigning very hard in favor, and a lot of people saying, no, we've had enough. There's a division there which is going to, I think, emerge during the campaign as a real gap between the government and the people.

FOSTER: And as you understand it, what are the technicalities here? If you win the argument and there's a no vote, what does that actually mean for Europe and Ireland, actually?

ROSS: Well, wait a minute, don't use me on this, just for the moment, because I didn't make a commitment one way or the other today. What is it? If we vote no to that, it doesn't mean that we come out of Europe, it doesn't mean that we come out of the eurozone. It means that we're not part of this fiscal treaty, which is 25 out of 27, which has agreed to very strict fiscal rules in perpetuum.

And one of the problems which Irish people -- Irish opponents of that see, if the hit is just a first step to another treaty, which will be, again, dictated by they big countries of Germany and France, and which may threaten what is very valuable to us, and that's our corporation tax rate at 12.5 percent.

And we're very, very keen to hold onto our right to set our corporate tax, because that's what brings the multinationals in. But there is a constant drive from the big countries to get us to increase it to their type of levels, which, as they say, it's not competitive.

FOSTER: OK, Shane Ross, thank you very much, indeed, from joining us from Dublin. Appreciate your time on the program.

Over to Greece., now, and lawmakers are set to vote on deeper cuts on pensions and public sector salaries. The austerity measures are crucial to securing further bailout funds from Europe and the IMF.

Greek unions are planning further protest on Wednesday against the cuts. It's part of a European-wide day of action against austerity. Today, Greek finance minister Evangelos Venizelos warned of a catastrophe if the country fails to tackle its deficit.


EVANTELOS VENIZELOS, GREEK FINANCE MINISTSER (through translator): We are still adding debt to our debt. And if we do not start to generate a primary surplus next year, that will be catastrophic. We will not be able to pay salaries and pensions.


FOSTER: Well, Athens' main stock index sank 3 percent this Tuesday. A lot of negativity still there. Alpha Bank and Piraeus Bank down more than 10 percent in Athens. Most banks outside of Greece did advance, Societe Generale up nearly 2 percent, RBS up 1.36 percent.

And this is what the US market is doing right now. Pretty uneventful, unchanged. More on that later in the program. We'll be right back after this break.


FOSTER: Stuck in the middle of the ocean with no power onboard. More than 1,000 people on the stricken Costa Allegra cruise ship are at least two days away from dry land. You understand, this is the first video of the ship we've seen. Right now, it's slowly being towed to the Seychelles.

With no heating or air conditioning, Costa admits the conditions onboard are difficult. Some people are even sleeping on the deck. David McKenzie has more for us from Nairobi.


DAVID MCKENZIE, CNN INTERNATIONAL CORRESPONDENT: The ship in question is this one, the Costa Allegra. It was en route between Madagascar and the Seychelles Islands in the Indian Ocean when on Monday, a fire broke out in the generator room and plunged the ship into darkness and stranded it in pirate-infested waters.

The ship is carrying more than 1,000 passengers and crew, and when it put out distress signals, it was met by a French trawler, which is dragging it towards the Seychelles Islands. Soon, tug boats from the Seychelles' government will join it.

They're having to bring in supplies by helicopter from the Seychelles. It is expected that the ship will arrive in Mahe Island on Thursday morning.

It's a deeply embarrassing incident for the company, because in January, the sister ship of the Allegra, the Costa Concordia, ran aground off the coast of Italy. More than 20 people were killed in that disaster, and there are several lawsuits pending, both in criminal and civil court.

David McKenzie, CNN, Nairobi, Kenya.


FOSTER: Well, with no power, it's been difficult to contact those onboard, of course. You can imagine how the passengers' families are feeling.

Jayne Thomas has had to go through this twice, would you believe? Her son, James, survived the sinking of the Costa Concordia. And now, her daughter, Rebecca, is stuck on the Allegra. I asked Jayne Thomas a little earlier how she came to be onboard.


JAYNE THOMAS, MOTHER OF TWO COSTA CRUISE EMPLOYEES INVOLVED IN MISHAPS: She was a dancer onboard Costa Allegra. She embarked in May last year, and she was on her second contract.

FOSTER: What have you heard since these news stories broke about the ship?

THOMAS: We haven't had any contact directly with Rebecca or the ship, or even Costa. All our information is coming via the news feeds at the moment.

FOSTER: Why is that, do you think? Because the power's out on the ship?

THOMAS: The power is out on the ship. All there is is emergency power, and that is just supporting contact with emergency services.

FOSTER: So, are you getting any information from the company at all? What information are you getting?

THOMAS: No, we haven't spoke to Costa at all. As I said, all our information is coming via the news feeds.

FOSTER: And your thoughts?

THOMAS: I'd like her home very quickly and very safely.

FOSTER: Are you concerned about her safety?

THOMAS: Not so much now. I was this morning, but once I knew the ship was tied to a tug boat and they actually had some propulsion from the tug boat, I feel less anxious.

FOSTER: An extraordinary twist of fate, because your son was on the other Costa ship, which famously ran aground. So, what went through your mind when you heard about this problem?

THOMAS: I couldn't believe it was happening to our family again, my second child onboard a second ship was in the same situation.

FOSTER: And your son, how's he, where's he?

THOMAS: He's now at home. I can't see him going onboard a cruise liner for a very long time, if ever at all. This certainly has, if the first situation didn't do that.


FOSTER: Understandable, isn't it? But Jayne actually hasn't got any hard feelings about the company at all. She thinks it's just a twist of fate. Costa's parent company, Carnival, took a massive hit to its reputation after the Concordia disaster. This will hurt it even more.

Carolyn Spencer Brown is the editor of the travel website She joins us now from New York. I mean, you could just not make this up, could you?

CAROLYN SPENCER BROWN, EDITOR, CRUISECRITIC.COM: You couldn't make it up the first time, and we certainly had the same reaction a lot of people had the second time, which was, "Not again. Please, not again."

FOSTER: What does it say about the company, if anything?

BROWN: From where I sit, it doesn't say anything about the company, but I don't think people want to hear that. I think that the -- Costa Concordia itself was a tragedy and really an unnecessary tragedy, and it still breaks my heart.

What happened with Costa Allegra, while not an everyday occurrence, it does happen on cruise ships. And I think what's really important to say here is that the crew performed as they were trained, as they were drilled, they put the fire out, they kept the passengers safe, and everybody's fine.

FOSTER: Could you just describe -- we've been told that the conditions onboard are difficult. What do you think they mean by that? Put that into reality for us.

BROWN: Well, sure. I think probably the toilets don't work very well, if at all. I think that it's hot. It's very warm in that part of the world right now.

I think that people are mostly being told to stay upstairs on the outer decks, where there's fresh air, and I think that's fine. You can sleep on a lounge chair if you need to.

I think that this situation, a lot of people are lumping this with Costa Concordia, but it has really nothing to do with Costa Concordia and what happened there, aside from the fact that obviously Costa is the company.

But look at what happened with Carnival's Carnival Splendor, off the coast of Mexico, when it had a fire in the engine room and had very similar results. Everybody was fine. Maybe a little bit uncomfortable and cranky after a couple of days with no power, but --


BROWN: -- back home quite safely.

FOSTER: Hearing there from Jayne, you would have heard her talking about her son, thinking this is extraordinary. He doesn't want to go on a cruise again, as you understand it.

But there will be a lot of people around the world actually looking at the cruise industry right now thinking, there's no way I'm going to invest on one of these trips. Is that -- how much damage would you say has been done to the cruise industry?

BROWN: Well, let's put it this way. It certainly hasn't been a marvelous 2012 to start with for the cruise industry. I think where we're seeing our readers at Cruise Critic being nervous is the new-to-cruise travelers who are just thinking about cruising, haven't quite bought into it yet, are certainly terrified by the visuals of the Costa Concordia.

There is no visual to be scared of on Costa Allegra. The fire was in an internal room and it was contained, so you can't see any kind of damage.

But I think that our core audience, which is people who have cruised before, understand first and foremost that Costa Concordia will hopefully never happen again in our lifetime. And that Costa Allegra, it can happen, the crew's trained to deal with it, and the crew did, in fact, perform as they should have.

FOSTER: Carolyn Spencer Brown from, we appreciate your time, thank you very much, indeed.

Next, confusion, desperation, and delay at Fukushima. A new report paints a damning picture of the response to the nuclear crisis. We'll tour the nuclear plant nearly one year on.


FOSTER: Nearly a year since the Fukushima crisis, and a new report presents a damning picture of official confusion. Ill-prepared politicians, bureaucrats, and executives struggled to respond to the emergency at the nuclear plant in the wake of last year's earthquake and tsunami.

The then government feared a devil's chain reaction with successive catastrophes at Fukushima and other nuclear plants closer to Tokyo. The prime minister feared it would lead to the evacuation of the city of 30 million.

Officials planned for worst-case scenario, but outwardly played down the risks and kept information from other countries. However, the report pinned most of the blame on the plant operator, TEPCO, which it says was astonishingly unprepared.

High radiation levels are still hampering a cleanup that's expected to take decades, now. CNN's Kyung Lah was among a small group of foreign journalists allowed into the Fukushima plant for the first time to see what the world's worst nuclear disaster in 25 years looks like one year on.


KYUNG LAH, CNN INTERNATIONAL CORRESPONDENT (voice-over): A year after these reactors at the Fukushima nuclear plant exploded in a triple meltdown, reporters were reminded, this is still one of the most hazardous places on the planet.

We wore head-to-toe protective gear, full facial respirators, and hazmat suits. And then, we drove up to the world's worst nuclear accident in 25 years.

LAH (on camera): This is our first look on the ground at the reactors. This is the hood of the nuclear problem in Japan. What you're seeing over my shoulder are the reactors. There are four of them. The two that you see over my right shoulder, those are two of the reactors that exploded in the early days of this disaster.

When you take a look at the reactors, you can see that they have a long way to go. This is a year after this disaster, and you can see that the force of the explosion crippled those buildings. You can understand how so much radiation spewed from this point when you're standing here.

LAH (voice-over): An army of 3,000 workers are now here daily, in shifts, to control the melted nuclear fuel and contain the further spread of the radiation. Inside the onsite crisis management building of the plant, a control center monitors their progress and safety 24 hours a day.

"The highest risk we still see is if something goes wrong with the reactor," says plant manager Takeshi Takahashi. The plant is in cold shutdown, but the nuclear fuel needs constant cooling, and the situation is far from over.

TEPCO says the plant won't be decommissioned for at least 30 to 40 years. The challenges evident as we drive around the Fukushima plant. Debris, still mangled from the tsunami, sits untouched because of radiation concerns.

These blue tanks and these larger gray ones hold water contaminated with radiation. TEPCO is continuously challenged with finding more space for the water. Work conditions and safety, while they've improved since the early days of the disaster, remain a constant concern.

Saori Kanesaki used to give tours to the public at the Fukushima nuclear plant. "Before the accident, I explained to many people that the nuclear power plant is safe," she says. "Now that this has happened, I feel very sorry I ever said that."

Kanesaki also lived here, in Tomioka. She's now an evacuee, uncertain of when or if she can ever return home. A year later, she and 78,000 others are the legacy of this accident, paying the price when nuclear energy goes wrong.

Kyung Lah, CNN, at the Fukushima nuclear plant.


FOSTER: And all next week ahead of the March 11th earthquake and tsunami anniversary, we will bring you a special look at reconstruction in Japan. That's right here on CNN.

Now, in five days time, Russia will head to the polls to elect a new president. Current prime minister and former Russian president, Vladimir Putin, is the man widely expected to win the vote.

But in recent months, he's faced unprecedented opposition. Tens of thousands of people have taken to the streets of Moscow to protest against his decision to stand again as leader. But to what extent is that anger being felt outside the capital? Here's CNN's Phil Black.


PHIL BLACK, CNN INTERNATIONAL CORRESPONDENT (voice-over): This is Venyov, about two hours drive south of Moscow. But it feels like another world. The population is small, the air is fresh. There is no obvious sign of Russia's impending election. And this town has never staged a rally protesting Vladimir Putin's intention to return as president.

BLACK (on camera): Vladimir Putin's team say they're confident of winning this election because they believe those who are angry with him are only in the big cities, Moscow, St. Petersburg. They say they are the economically comfortable people who now want greater political freedoms, like those they see in the west.

Outside of that group, they believe support for Putin is strong. We've traveled outside of the Moscow region to test that theory.

BLACK (voice-over): We arrived at Venyov's market, and the theory is challenged immediately. "Everything is bad. Putin did it all," this woman says.

These are poor people, selling what they can to get by. This woman knits socks at night and sells them here during the day. On a good day, she'll make about $10.

"When you hear Putin on TV, our life sounds so good, but in reality, things are terrible," she says.

This quiet, largely empty marketplace is a long way from the avenues and squares of Moscow that are now regularly filled with tens of thousands of protesters. But this woman says she understands their anger.

"Why do people go to rallies?" she asks. "Because they want a better life. And at the moment, life is hard. I support them."

At the market, we meet Galina (ph). She wants us to see her home. She shows us a blocked and open sewer near the building. Inside, the smell is terrible, the floor is collapsing. She says local authorities will do nothing to fix it.

This is one pensioner's life in Putin's Russia.

Her neighbor, Roman, says he dreams of leaving the country. "Putin led Russia to the point where nothing is working now," he says.

Putin has served eight years as president, followed by four as prime minister. There are people in Venyov who welcome his return to the presidency. "I think he is the most deserving candidate." This woman says her family loves Putin, but she understands why many people in this town are elsewhere are furious with him.

The angry people of Venyov have little in common with Moscow's affluent protesters, but they share an intense dislike of Vladimir Putin's leadership, and it will endure beyond his likely win in this election.

Phil Black, CNN, Venyov, Russia.


FOSTER: We'll be following it for you with special coverage. And we'll be right back with more business news after this short break.


FOSTER: Welcome back. I'm Max Foster, these are the main headlines this hour.

Activists say 102 people have been killed today in Syria. Nearly half of those deaths came in the city of Homs. The UN says more than 7,500 people have been killed in nearly a year of turmoil. US Secretary of State Hillary Clinton says Syrian president Bashar al-Assad could be tried for war crimes.

In Pakistan, officials say 18 Shiite Muslim men were gunned down after armed assailants stopped the four buses they were riding on. Pakistan's interior minister says the killings occurred in an area of northwest Pakistan where sectarian violence is rare. He said the Sunni men on the bus weren't hurt. Pakistan's Taliban are claiming responsibility.

A crippled Italian cruise ship is being towed right now to the Seychelles. The Costa Allegra was left adrift in the Indian Ocean when a fire swept through its engine room. The area is known for pirate activity. One thousand passengers and crew members onboard are set to be in good health.

Republican presidential primary contests are underway in the US states of Michigan and Arizona. Michigan is the real battleground. A loss there would look very bad for Mitt Romney, as he was born there, and his father served as the state's governor. A recent poll showed Romney with the lead in Arizona.

A third student has now died from his injuries after Monday's shooting inside a US high school near Cleveland, Ohio. Two others are wounded. Police say no motive has been established. The suspected gunman, a 17- year-old student, identified as TJ Lane, is expected to appear in court for the first time in the next few hours.

Oil prices are sliding back from nine-month highs. Right now, Brent Crude is trading at $121.60 cents a barrel, down around 1.33 percent since Monday, $1.70, currently. One thing affecting the price of oil, increased tension between Iran and the West.

Now, some analysts say this has added $10 a barrel. As John Defterios reports, the uptick is not only causing petrol prices to climb, but may prompt the largest exporter to open its taps.