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Arrests In Hoffman Investigation; Obamacare And Jobs; CEOs Make A Fortune

Aired February 5, 2014 - 05:30   ET





CHRISTINE ROMANS, CNN ANCHOR (voice-over): Happening right now, a massive winter storm barreling across the country. Yes, it's happening again -- 100 million people in snow, sleet, ice, shutting down schools, chaos at the airports. We're live as the storm rolls through this morning.

JOHN BERMAN, CNN ANCHOR (voice-over): Breaking news overnight. Four people arrested connected to the death investigation of Philip Seymour Hoffman. Did they supply the drugs that killed him?


ROMANS (on-camera): Welcome back to EARLY START. I'm Christine Romans.

BERMAN (on-camera): And I'm John Berman. It is 31 minutes after the hour right now.

ROMANS: And a CNN fact check, this morning. A T.S. Eliot (INAUDIBLE) is wrong. February is the cruelest month and not April.


ROMANS: February is the cruelest month.

BERMAN: Sorry, Mr. Eliot.

Thirty-one minutes after the hour right now. We are going to start with what is happening to so many people at this very minute. Millions getting hit by a huge, fast, and powerful winter storm, delivering not just snow but treacherous ice as well. This is blanketing an area from Philadelphia all the way up to Boston. So many schools are closed.

Here in New York, for now, at least, the nation's largest district, will be open. That's for now. There are real risks today, especially with the ice starting to come down. This could get really, really bad. ROMANS: Nearly 2,000 flights have now been canceled mostly in New York and Boston. But, hey, a lot connects through New York and Boston, so check your schedule. This is the scene in Kansas City when a Southwest Airlines jet wound up stuck in a snowdrift just after landing. The jet was taxiing to its gate. Fifty-five passengers, five crew members on board. They were all taken off the plane and brought safely to the gate by bus.

BERMAN: Wind and snow. It is not a good combination. Look at these pictures. This is what it looked like in Southern Illinois not far from St. Louis. The only thing moving in that car because the wheels aren't working, they only got a few inches of snow and ice, but you can imagine, the driving, it's just a mess.

ROMANS: In Indiana, while it's feeling the punch, too. Crews out late treating the roads after snow turns a sleet and freezing rain. These pictures we're showing you right now are from Bloomington where the evening commute was a just a real mess.


UNIDENTIFIED MALE: We spent about 45 minutes traveling about blocks. And it's not a lot of fun. Thinking about moving to Florida, actually.

UNIDENTIFIED MALE: Took about like an hour just coming from that light right up there.


BERMAN: And the evening commute, there is what the morning commute will look like in a huge part of the east coast this morning. Meanwhile, Cedar Rapids, Iowa could see a little more snow today, but the real problem is the plunging temperatures. And the wind, that city already has about three inches of snow, and the wind is likely to blow all over the place today making the driving even worse.

ROMANS: And three inches of snow in Iowa is manageable. It's the ice, it's the wind, and the visibility that's a real problem. OK. The same story in Wichita, Kansas. Blowing snow, making travel all but impossible. That city slammed with nine inches of snow, and that's a new record. Some parts of Kansas got more than a foot.

BERMAN: Wow. Across the border, Kansas City warned residents to stay home and for good reason. That city pounded with upwards of 10 inches of snow. Look at all the stranded cars there. A lot of unhappy drivers. It's also leading, though, to some good deeds, which is nice to hear. Anyone who witnesses someone being helpful is being encouraged to tweet about it #kchelps. And the feed is filling up the stories of neighbors helping neighbors.

ROMANS: All right. Chad Myers is out in the snow here in New York City with what you need to know about the storm. Good morning, Chad.

CHAD MYERS, AMS METEOROLOGIST: Good morning. About two hours ago, it was all snow. Light, fluffy, great-looking snow band snow. But then all of a sudden, it started to sleet. Now, it's raining. And the CNN sign right there says 30 degrees. Well, 30 degrees and this shine right here is not going to be good for the rest of the day.


MYERS: It's raining because at about 3,000 feet, it's 35 degrees. It's raining down through the atmosphere and down here where it's 30, and everything is freezing up. Now, scooping this sounds like a great idea. But if had they left the snow, the snow would have made a little traction. You scoop away the snow and all you have is glazed ice. It could be very, very slippery today. Even if it looks like it's been cleared, that may be the worst spot you walk on.

Here's what the graphics look like. Snow all the way from New England through Binghamton, all the way back to Buffalo and Erie, even into Pittsburgh. The heaviest snow is going to be to the north of where the heaviest snow was last time. We're talking about Binghamton, Syracuse, Saratoga, back to Rutland, and all the way back over to Maine.

The ice is what we're getting here. The ice is the problem. We're going to see some spots three-quarters of an inch of ice. Now, if it just bounces off because it's sleet, that's good. But if it's raining the whole time and collecting on the power lines, collecting on the trees, we're going to see power outages for sure.

And certainly, we're going to see a lot more school districts. At least those superintendents thinking about it right now in the early morning. Do they want to send kids out in this or not, I don't think it's a good idea.

BERMAN: No. Half an inch of ice, three-quarters inch of ice, that is really, really treacherous stuff. Chad Myers, thank you so much.

MYERS: You're welcome.

ROMANS: All right. Breaking news overnight in the investigation into the death of Philip Seymour Hoffman. This morning, police in New York say they have arrested four people believed to be connected to the drugs found in Hoffman's apartment. That as new details emerge of just what Hoffman did in the days before he died, that death of an apparent heroin overdose in his Manhattan apartment.

CNN has learned the night before, Hoffman withdrew $1,200 from an ATM at a Manhattan grocery store. And at the Sundance Film Festival, that was two weeks ago, a magazine writer says Hoffman walked up to him and started to talk.


JOHNY ARUNDEL, MAGAZINE WRITER: He was wearing this floppy hat. And I didn't recognize him. And I asked him his name. He said, "you don't recognize me?" And at that point, I said, "well, should I know you?" And he said, well, "I'm a heroin addict." The whole encounter was less than 10, 15 seconds or so. But as he was walking off, he said, "I just got out of rehab." (END VIDEO CLIP)

ROMANS: Toxicology reports from Hoffman's autopsy are still pending. The family is planning a private funeral for the 46-year-old academy award winner and father of three.

BERMAN: So sad.

In Washington this morning, we expect a lot more fallout from a controversial Congressional Budget Office report on Obamacare.


BERMAN (voice-over): A report that Republicans say proves the Affordable Care Act is a job killer, and Democrats insist the GOP is misinterpreting it. Here's what the report really says. The CBO finds that the Obamacare law will reduce the workforce by the equivalent of about two million jobs.

That's not people losing their jobs. That's just fewer people who will be working or try to work. It's not accomplished again by cutting jobs, just a reduction of numbers of hours people have to work to get coverage. The White House says people will choose not to work. Still, it's very controversial. And both sides staked out their positions over what this means.


SEN. MITCH MCCONNELL, (R) SENATE MINORITY LEADER: I wonder what the cost benefit ratio is of all of this disruption both to the providers of health care and the consumers of health care, when at the end of the day, the best you'd be able to estimate is we've reduced the number of unemployed from 45 million down to 30 million at what cost.

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: By giving you the option of affordable and quality health insurance, we're not giving you -- that's not a negative thing. That's a positive addition to the choices before you.


ROMANS (voice-over): What's so interesting about this, too, John, is that the original forecast where there will be 800,000 equivalent job lost. So, immediately -- this is worse than they had originally forecast.

BERMAN: More than double. The subject of estimates that they're showing (ph) to be true. The TCBO also now estimates that the flawed rollout of the health care exchanges means that a million fewer Americans will get coverage than originally estimated this year.

ROMANS: All right. At the White House today, President Obama is set for another series of key meetings with Senate Democrats to stop by to talk about economic priorities this year. Last night, House Democrats visited the White House. The president told them he will continue to use his executives powers if Congress won't take action on its own. BERMAN: This morning, the $1 trillion farm and food stamp bill is closer to becoming law. It's been given final approval in the Senate. President Obama is set to sign it on Friday in Michigan. The bill will expand crop insurance for farmers, but it will cut direct payments. It will also reduce food stamp spending by $8 million over the next decade.

ROMANS: This morning, anger growing in Congress over the NSA surveillance programs. Lawmakers warning reforms must be made soon or they will take action. Right now, the USA Freedom Act is making its way through Congress.


ROMANS: That measure would eliminate the NSA's bulk collection of metadata entirely if the Obama administration doesn't act soon.

BERMAN: We're finding out today just how Edward Snowden got his job was a major defense contractor. The vision, of course, that opened the door to his stealing thousands of documents. This is all according to former NSA director, Mike McConnell (ph), who is now a top executive with Booz Allen Hamilton.

He says that Snowden targeted the firm knowing it would give him high- level access to all these secrets. And he claims that Snowden broke into the NSA's computer system and stole the answers to the agency's employment exam. He calls Snowden the worst spy in American history.


ROMANS (on-camera): Overseas markets, let's say they're taking a breather today after that sharp selling earlier in the week. Markets in Asia and Europe right now mixed. Here in the U.S., stock is bouncing around breakeven. We watch the futures market for stocks, even though -- you know, four hours away until the opening bell. Welcome relief after Monday's 362-point selloff.

We're going to get a peek at the job market for the first month of the year later this morning. We're going to look at the data from the payroll company, ADP. It's got a monthly report on hiring. And then Friday's jobs report is really the big one. We want to see what that says about hiring. Disappointment in December, quite frankly.

I'm going to be looking to see if the brutal cold and the snow that's blanketed much of the country is going to sort of play havoc in these numbers and whether it really took a toll on workers like construction and retail. So, we could see the effect of the snowstorms in these jobs report. That could be really, really important.

BERMAN (on-camera): It is so interesting. We always complain about the cold and the snow, but really, we've got a huge economic impact right now.

ROMANS: It really can. There'll be overtime for some people and there'll be other people who couldn't go to a job interview.

BERMAN: All right. Forty-one minutes after the hour.

Coming up, facing scandal at home. Chris Christie prepares to take his message on the road. The Chris Christie road show. The New Jersey governor's new plan to stop these poll numbers from sinking. That's coming up next.


BERMAN: All right. The breaking news this morning is the weather.


BERMAN: Just pounding millions and millions of people this morning for a treacherous morning commute. You were just looking at live pictures of Hartford, Connecticut there. The snow there just simply falling. I was hearing in Connecticut, three inches an hour of snow coming down. We also have pictures, I believe, from Cincinnati, Ohio right now. A look at the roads there.

A slow morning commute as there is still some snow falling. Not a lot of cars on the road. And you know what? It's a good idea not to go out on these roads because it's dangerous in so many places. This is what it looks like in New York City. This is Columbus Circle right now. Now, you will notice you don't see it snowing. That's actually the bad news. It's because the rain -- it's turned to rain.

The snow turned to sleet and now to rain, and it is freezing on the roads and the sidewalks. And this is incredibly dangerous. We're talking about maybe half an inch, three-quarters of an inch of ice. This will make the roads a skating rink. Not the kind of thing you want to be driving on this morning. So, please, be very careful. Check what it's like before you go outside.

ROMANS: Yes. Chad Myers just told us it's 30 degrees there on the ground, but the snow's falling as rain now and that's a real problem - immediately. OK.


ROMANS (voice-over): Chris Christie is about to hit the road launching a month-long fundraising tour that will take him around the country and test his star power in light of those scandals dogging his administration. Christie is going to raise money for other Republican candidates and speak at the Conservative Political Action Committee meeting in Washington. That tour kicks off tomorrow in Texas.

BERMAN (voice-over): A federal grand jury is now issuing subpoenas into the chemical spill that left more than 300,000 people unable to use their water in West Virginia. A federal official confirms to CNN this is a criminal investigation. Some 10,000 gallons of these chemicals leaked from a freedom industries holding tank into the Elk River last month.

Water bans have been lifted. Many residents are still reluctant to drink the water. Independent tests found trace levels of the contaminant still in the water supply. (END VIDEOTAPE)

ROMANS (on-camera): All right. Let's take a look at what's coming up on "NEW DAY." Chris Cuomo joins us this morning. Hey, Chris.

CHRIS CUOMO, CNN CORRESPONDENT: Hey. I'm glad you guys are staying on that West Virginia story.


CUOMO: I was to get this feeling there's a little bit of a pass given to the company involved in that situation there, because the town is so dependent on that coal production. So, it's good to stay on that. Really is very responsible of us. Good to hear it, John. Good to hear it, Christine. Good you're doing that.

We are going to try to be responsible about the storm. You know why? It's not enough just to look outside your window. It turns out all these concentric systems. That's what Chad Myers told -- I don't know what that means, so he'll explain to us this morning. But I do know this, it's like the entire eastern half of the country is caught up in this snowstorm sensation that keeps happening.

You're going to get major cities with as much of a foot. Nobody is flying anywhere. So, if you're watching us in the airport this morning, get comfortable. Sorry to say, check everything early.

We're also going to talk about the economy this morning because we know that the stock markets had a little bit of a rough start to the year. How does that relate to the overall economy? At the end of the day four you, other than your 401(k), it's really about the overall economy and where are jobs coming and how do CEOs feel. So, we're lucky enough to have a top executive from the price Waterhouse Coopers Firm.

They're not just about the Oscar awards. You know, they put out economic data. So, John and Christine, we're going to have them, one of their honchos this morning, to talk about the realities of the overall economy. What did they think about growth? What did they think about how to fix inequality? We will get it from one of the big shots.

BERMAN (on-camera): All that plus accountability coming up on "NEW DAY."

CUOMO: Accountability likes this.


BERMAN: All Right. Thanks, Chris. We'll see you in a little bit.

ROMANS: All right. Coming up, George Zimmerman set to fight in a celebrity boxing match. We're going to tell you who's getting in the ring with him, next.

BERMAN: Use the term "celebrity" loosely here. <06:26:45>


ROMANS: We now know just who George Zimmerman will be boxing for charity in coming weeks.


ROMANS (voice-over): Rapper, DMX. The fight promoter telling CNN he got 15,000 e-mails asking for a chance to enter the ring with the former neighborhood watch captain. The pair will face off for three rounds, though, the timing and location not clear. There are promises this morning that all will be revealed at a news conference in Philadelphia, John, next week.

BERMAN (voice-over): I don't like this. I don't think I like the message this is sending out.

Meanwhile, this morning, we're finding out what will become of actor, Paul Walker's estate estimated at some $25 million. The "Fast & Furious" star's will leaves everything to his 15-year-old daughter and calls for his mother to serve as her guardian. Walker died last year in a fiery car crash near Los Angeles. The will was prepared and signed in 2001, the same year as the first "Fast & Furious" film.

Attention, Red Hot Chili Peppers fans, they were faking it. The band admitting in an open letter on their website they weren't playing their instruments during the Super Bowl halftime show. You could kind of tell. Well, their instruments weren't (ph) plugged into anything. Well, they were jumping around like crazy.

How could you be plugging into something when you're performing like that? Bassist, Flea, writing the NFL, asking to take the step because of any potential sound issues, but he insists. The singing there was live.

BERMAN: I don't like this either. A live performance is a live performance. If you're going to play music, play music.


ROMANS (on-camera): They're playing a real football game. They should be playing real music.

BERMAN (on-camera): I know.


BERMAN: That's awesome. I'm with Romans on this.


BERMAN: All right. Coming up, salaries are going up for some people, big time CEOs, including the new leader of Microsoft. We will have these epically huge numbers in "Money Time" next. It's not many time. ROMANS: It's big time.

BERMAN: Big time.

ROMANS: Big money time. Big money time.



ROMANS: Good morning. Welcome back to EARLY START's "Money Time." Three minutes to the top of the hour.

The stock market, not quite sure which way to go this morning and we'll take that. Stock futures are mixed right now. Markets in Europe are rebounding. The London stock market looks like it might end a five-day losing streak. Asian markets just closed with mixed results. All eyes on an early jobs report that comes out this morning. Now, this is going to be the first look at unemployment for 2014.

We're learning that the severe weather creating a lot of trouble across the country. It's hurting sales for you as automakers and retailers. We'll see what that means for you and the state of hiring in a little over two hours from now. It's not the official jobs report. It's -- it's a private sector payroll report, but people really watching this one.

Microsoft named its new CEO yesterday, Satya Nadella. He's going to be paid handsomely for his services even if the company doesn't perform well. On his first day on the job, we learned that Nadella may take home more than $17 million this year and more than $30 million next year. This puts him in the top five highest paid tech CEOs. But keep in mind, it is a big company, and he's got a big job ahead of him.

Eric Schmidt, Google's executive chairman and former CEO is set to receive, this is not a typo, $106 million in bonuses based on the search giant's 2013 performance. It had a great year. Google reported sales in nearly $17 billion in just the fourth quarter of last year, and a lot of the CEO compensation is tied to how well the company performs for its shareholders.

All right. The winter weather took its toll on U.S. auto sales in January. Sales tanked at Ford, GM, Toyota, and Honda, all because of that extreme winter weather. It's not the case, though, for exotic cars. They made a record high. Lamborghinis, Bentleys, and Rolls Royces all racing off floors (ph). Luxury car loves in China and America driving these sales.

And you know, when I've been looking at the economic tea leaves, I will tell you something, if has to do with rich people, business is good. If it has to do with everyone else, ehh, not so much.

BERMAN: Yes. This is a really, really telling think, I think, actually. High-end selling everywhere. ROMANS: All right.

BERMAN: "NEW DAY" starts right now.


UNIDENTIFIED MALE: it's not a lot of fun. I think about moving to Florida, actually.

CUOMO: The unrelenting winter. More than a hundred million Americans waking up to another round of snow. Major cities getting as much as a foot. It seems like more planes are like this than in the air and it's even bigger storm right behind it. Will this ever end?

KATE BOLDUAN, CNN CORRESPONDENT: Olympic threats with only two days to go until the games. The torch arrives in Sochi and U.S. intelligence officials now say there have been specific threats detected ahead of the games.


What did they know?

MICHAELA PEREIRA, CNN CORRESPONDENT: Breaking overnight, four people arrested in connection with the death of actor, Philip Seymour Hoffman, accused of providing the drugs that likely killed him. We're live with the latest.

CUOMO: Your "NEW DAY" starts right now.

ANNOUNCER: This is "NEW DAY" with Chris Cuomo, Kate Bolduan, and Michaela Pereira.


CUOMO: Good morning. Welcome to "NEW DAY." It's Wednesday, February 5th, six o'clock in the east. Welcome also to the winter that just won't quit.