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Jobless Rate Drops to 6.3 Percent; Rain Causes Road Collapse in Baltimore; Fed Officials Investigating 55 Colleges, Universities; Teen Planned School Attack; Nigerian Protest for Kidnapped Girls; Afghan Landslide; Report Says Donald Sterling Has Cancer; Political Fallout Over Benghazi Emails; MH370 Search Authorities Address Media

Aired May 2, 2014 - 11:00   ET


JOHN BERMAN, CNN CO-ANCHOR: @ THIS HOUR, big news about the economy, hiring goes up, way up, and the unemployment rate goes down, way down, but was April really a good month for the economy as a whole? Find out.

MICHAELA PEREIRA, CNN CO-ANCHOR: And the Clippers owner might have another battle on his hand that has nothing to do with the business, race or outrage, that newest development, ahead.

BERMAN: And Ukrainian forces on the attack, trying to wrestle back a key city, but pro-Russian rebels hold fast and take down two helicopters, this hour, President Obama and a key world leader weigh in on this mounting crisis.

Hello, everyone, happy Friday. I'm John Berman

PEREIRA: You beat me to it. I'm Michaela Pereira.

It's 11:00 a.m. out in the East and it is 8:00 a.m. out West, of course, those stories and much more, right now, @ THIS HOUR.

The casualty count in Ukraine, ticking up as the prospect of peace all but evaporates, hundreds of troops are already in the region.

This hour, President Obama and German Chancellor Angela Merkel are due to speak at the White House in the White House Rose Garden. We'll to bring those comments to you live.

The April jobs report making news @ THIS HOUR, government figures show more than 280,000 jobs were added last month and the unemployment rate has dropped four points to 6.3 percent. It hasn't been that low since 2008.

BERMAN: No. That is a big, big drop, much bigger than expected, and there were revisions over the last few months showing more jobs added than expected, than they thought at the time.

So we're joined now by Rana Foroohar along with our Alison Kosik.

There's a lot going on with these numbers, Alison, a lot of it very good, but not all of it perfect. ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Right, no doubt about it. The 288,000 job additions for April, that's good. It shows that the job growth is really taking on, that there is momentum in the economy.

But then there are a couple of dark clouds in this report even after the winter thaw is happening. For one, you look at the unemployment rate. It's at 6.3 percent, falling from 6.7 percent. And you look at that headline, you think, gosh, that sounds great.

But the problem is the reason it fell is not good. It's because the labor-participation rate has fallen to its lowest level since 1978. That rate is made up of the number people who have jobs and the number of people who don't have jobs, but are looking for work.

And the problem is, the big reason why that rate fell is because the majority of those people, they just gave up looking for work. They grew discouraged and just dropped out of the labor force.

The other dark cloud is the wages that we're making. The amount of money that people are making at work, it didn't budge from March to April.

And the reality is that if you want to see the economy grow, and it is growing, but if you want to see it grow at a more robust pace, people need to make more money.

You've got to make more money to buy goods and services and buy houses and cars, and you're not going to see that if you don't see wages keep up with inflation.

Michaela and John?

PEREIRA: That's why it's so important to look past the headline, because sometimes these numbers represent a little bit of a different reality.

Rana, I want to talk to you about this. You're the perfect person to ask about this, as an economic analyst.

There is a question about how long it's going to take before we get back to those pre-recession levels.

RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: What you're seeing now is a very bifurcated recovery, so if you look at the short-term unemployment figures, those are really back to normal.

There are people in this country that are finding jobs. Jobs are being created, particularly in sectors like construction and retail, which really suffered from the long spate of cold weather in the winter.

But there's a whole other group of job seekers that are dropping out of the workforce, and the big question is whether they will ever find work again.

And that's of importance not just to these families, but to Fed policy and whether we hike interest rates faster or slower, so this is a big question in the economy right now.

BERMAN: Rana, you said what we're seeing is a bifurcated economy. What you're also seeing is an explanation now for the politics in Washington, particularly from the White House.

Yes, you're getting these big jobs numbers added now on a fairly consistent basis, but it does help explain why you're seeing the big push for the minimum wage from the White House, the big push for extending unemployment benefits from the White House. They're trying to thread this political/economic needle here, aren't they?

FOROOHAR: Absolutely. And I think this question of inequality of minimum wage, these are going to be more and more important issues, certainly in the midterm election cycle, in the 2016 presidential elections even.

It's interesting that a book on inequality, a 685-page book by a French academic is actually number one on the Amazon bestseller list. That's kind of amazing. I think it show that this issue is really in the zeitgeist. People know there's a recovery, but they don't feel it so much in their pocketbooks.

BERMAN: You're seeing that some of the polls. It's actually dragging down the president's approval rating in some cases.

PEREIRA: Alison, I'm curious how the markets reacted today because of this April jobs report.

KOSIK: Markets are higher right now. You're not seeing a celebration. Actually, they're mixed right. They turned a bit lower.

But it's because what I think you're seeing is the focus on the two sort of dark clouds that I mentioned, that, yes, we are seeing that trend improve in job creation.

But the reality is, you know, what kinds of jobs are people getting? What are they being paid for those jobs that they're doing? And what about all those people who aren't working?

We've still got millions of Americans who don't have jobs who want jobs and who can't get jobs.

Michaela? John?

PEREIRA: Alison Kosik, Rana Foroohar, always a pleasure to have you here. Thanks for crunching the numbers with us, ladies, and telling us what they all mean.

Some other stories we're following @ THIS HOUR, got to show you this unbelievable video.



(END VIDEO CLIP) PEREIRA: You know, that looks like something out of a science-fiction movie or a Hollywood special effect, that is reality, and you can hear the people screaming as they're a whole road collapse right before their eyes, cars falling into the flood waters.

That happened in Baltimore. That city got at least four inches of rain. Fortunately -- this is the big takeaway -- no one was hurt.

BERMAN: And no one got a good parking space, either.

Authorities in Minnesota think they have prevented what could have been a horrific school attack.

Seventeen-year-old John David LaDue is in custody. Police say he had bomb ingredients at a storage unit and a journal at home detailing plans to blow up his school and gun down fellow students.

LaDue allegedly planned to kill his family, as well, and set fire to distract first responders.

Police say someone noticed a person acting strangely at the storage facility and tipped them off.

PEREIRA: If you see something, say something, right?

BERMAN: Yeah. Lucky.

Federal officials are investigating 55 colleges and universities over their handling of sexual-violence complaints.

This is the first time the Department of Education has released a list of all investigations, explaining, quote, "We hope this increased transparency will spur community dialogue."

PEREIRA: Parents in Nigeria, taking to the streets demanding their government do anything possible, everything possible to bring their girls back home.

Two-hundred-and-thirty girls were kidnapped by militants in the dead of night from their school dormitory some two weeks ago. Forty-three of them have managed to escape, but the others are allegedly being sold.

They're being sold for $12 each to the militants, and they're being forced to marry and do unmentionable other things.

This weekend, there will be a demonstration in California asking the U.S. government to push for those girls release.

BERMAN: This is a tragedy. It is outrageous.

PEREIRA: Outrageous.

BERMAN: And it's something everyone --

PEREIRA: Biggest of human-rights violations. BERMAN: Everyone needs to pay attention to this over the next few days.

Meanwhile, at least 2,700 people are estimated to have died in a landslide in a remote part of Afghanistan. This -- we just learned this a few minutes ago. This is according to a provincial governor there.

The area, extremely mountainous, at least 200 homes are said to have been destroyed by this landslide.

PEREIRA: Ahead @ THIS HOUR, with violence boiling in Ukraine, President Obama and Angela Merkel are talking options. Are there really any good ones left?

We're just minutes away from their joint news conference. We'll take you live to the White House Rose Garden when that happens.

BERMAN: Plus, the embattled owner of the Los Angeles Clippers faces the loss of his team. So, what are Donald Sterling's options now? That's next.


PEREIRA: One of Donald Sterling's battles may very well have nothing to do with the NBA.

ESPN and other some outlets are reporting now that the 80-year-old is also battling cancer. "The New York Post" was the first to report it.

Now CNN has not been able to independently verify this.

BERMAN: This, of course, coming as league owners take the first steps with a plan now to make Donald Sterling sell the Los Angles Clippers, this is all coming after those now infamous remarks that came out on that audio tape, those racist comments.

Our Rachel Nichols is following the story right now. Rachel, what's the latest? How is the team reacting to this news?

The cancer news came last night, a lot of these players hearing it during or right after their game.

RACHEL NICHOLS, CNN HOST, CNN'S "UNGUARDED": Yeah, as they stepped off the court from this super-emotional playoff loss, by the way.

But this shows you how classy a locker room this is. This has also been known as a good group of guys, and it's part of the reason people felt so bad for Chris Paul and Doc Rivers when this broke, because they're so well liked around the league.

Their reaction to this man who's shown hatred towards them wasn't negative. In fact, Blake Griffin said you don't wish that on anyone. We wouldn't want him to be sick. They all said we send our thoughts and prayers.

They've made it clear they don't wish harm on Donald Sterling. They just don't want him to own their team anymore.

PEREIRA: What do we know about his health at this point?

NICHOLS: There's been rumors for a while that he's sick. Look, he's 80-years-old, so he's looked a little bit more puffy over the last year. People have started to ask some questions.

At some point, age gets us all, but you know, these are two separate issues.

PEREIRA: They really are.

BERMAN: This committee, this committee that met yesterday, they voted or moved unanimously to push for -- to force him to sell.

Is that an indication of what we might see from the larger ownership group?

NICHOLS: It is, although it's interesting. I expected them to get off that call and say, great, we've decided to give Donald Sterling notice. They didn't do that. They said we've unanimously decided to meet next week.

So this tells you it's complicated. It's not as cut and dry as people would like it to be. It's a legal issue, and we're starting to see, too, some of the strategies that Donald Sterling might use if he's to make an end-around this.

Like, he's probably not going to gain traction with the other owners. They probably will eventually vote to force him out.

But legally, does he decide to file, say, an antitrust lawsuit? That's a way to get around the arbitration process.

PEREIRA: Does he have legal standing there?

NICHOLS: He doesn't really have a legal case, but the idea is that you file a bunch of depositions, detailing the bad behavior of all the other owners to say, why would you kick me out when you didn't kick them out? And that's not something anybody wants.

But here's the kicker. Here's the other sort of strategy that surfaced today as a possibility. We know that he and his wife have been separated. If one of them decides to file for divorce, then the team is community property under California law, right?

It becomes under the jurisdiction of the California family court. It gets tied up for months, maybe even years. We all know divorces that have stretched on for a long time.

BERMAN: Seems like such a healthy marriage.

PEREIRA: But I tell you, I hear reports out of Los Angeles that they're not separated, and it's all been a murky issue for quite some time.

At the end of the day, if he does sell -- and this is the thing. He's 80-years-old. He's dealing with a health issue.

We know that he was litigious. He has been. He has been up in several cases. Does he have that fight in him?

NICHOLS: Well, you know, and "The L.A. Times" did a very interesting thing. They actually dug into their own archives and started looked at all the old articles on Donald Sterling, and they found something where, more than 30 years ago, he was under inspection for trying to move the team from San Diego to L.A., we were taking about this yesterday. And the NBA decided that -- they heard him say I'm going to try to basically tank for the bottom draft -- top draft pick. I want to be the worst in the league. These were audio recordings at him at a luncheon. Interesting, Donald Sterling getting in trouble for audio recordings, and the league moved they wanted to get rid of him. He made an end round, around them. He said, okay, I'll just sell, I'll just sell, and he put it into such legal process for a long time and they eventually gave up and he kept the team. We have seen it before.

PEREIRA: Are they more savvy this time is the question.


BERMAN: A charming, charming man. Rachel Nichols, great to have you here with us, really appreciate it.

Ahead for us @ THIS HOUR, this is a stunning story. A potential high school massacre prevented. We will tell you what police say they found in a teenager's storage unit and about the police tip that might have saved the day. Plus Malaysian officials insist they have nothing to hide as they tackle questions about flight 370.


PEREIRA: New political fallout this morning, from the Obama administrations response to the deadly 2012 attack on the U.S. diplomatic compound in Benghazi, Libya.

BERMAN: The Republican chairman of the house oversight committee has issued a subpoena to secretary of state, John Kerry. Darrell Issa is calling on the secretary to testify on May 21st about the state department quote, failing to meet its legal obligation to provide documents related to the attack. In a letter to the secretary Issa writes quote, compliance for the subpoena for documents is not a game.

BERMAN: Let's turn now to the latest developments in the search for flight 370. Just hours ago, we learned Malaysia is considering sending a ship to the Bay of Bengal to investigate a claim that that is where the Boeing 777 might have gone down.

PEREIRA: Authorities have repeatedly dismissed claims by this Australian company, GeoResonance, that it might have discovered the plane's wreckage. But during a news conference in Kuala Lumpur, officials were grilled about the Bay of Bengal theory and about their report of the plane's disappearance. Our Will Ripley is in Kuala Lumpur with all the details. WILL RIPLEY, CNN INTERNATIONAL CORRESPONDENT: John and Michaela, for the first time Malaysian officials are answering tough questions about the report that shows hours were lost with confusion and delays right after flight 370 disappeared. They're also, for the first time, dismissing reports of possible wreckage thousands of miles from western Australia.


HISHAMMUDDIN HUSSEIN, MALAYSIAN ACTING TRANSPORT MINISTER: As I have repeatedly stressed since the beginning, we really have nothing to hide.

RIPLEY: New this morning, Malaysian officials are dismissing claims by a private company, of possible wreckage in the Bay of Bengal, several thousand miles from the search zone.

HUSSEIN: Many of these in the past have proven to be negative and this is similar to what we have done before.

RIPLEY: Breaking overnight, news of a trilateral meeting between Australia, China and Malaysia.

ANGUS HOUSTON, JOINT AGENCY COORDINATION CHIEF: Were totally committed as three nations, I believe, to find MH370.

RIPLEY: The next step, a daunting deep sea search, off western Australia. Eight to 12 months, an estimated $60 million, and more assets joining the blue fin 21. Which so far, has found no sign of the missing plane. Air traffic control audio of those haunting final words from the cockpit just seconds before the plane's tracking devices were switched off. This new report detailing the hours of confusion that followed. Seventeen minutes before anyone noticed the plane disappeared from radar. Another four hours of inaction in the control tower.

AZHARUDDIN ABDUL RAHMAN, MALAYSIAN AVIATION CHIEF: Why 17 minutes this is some -- this is what I told -- It is up to the investigation team, to study and investigate.

RIPLEY: Meantime, more heartbreak for the families of flight 370. During this meeting in Beijing, learning Malaysia Airlines assistance centers are closing in just a few days. Forcing them to go home without any answers about the plane or the 239 people still missing eight weeks later.


Two more pieces of information coming out of press conference in Kuala Lumpur, Malaysia Airlines admitting they were using a flight tracker similar to what you find on your cell phone and that's what led them to believe the plane was in Cambodia when in fact, it was far away from there. Something they are now looking into. They're also looking into those 17 minutes that were lost when nobody seemed to notice the plane just vanished from radar. They say the are examining the protocol to make sure that doesn't happen again. John and Michaela. BERMAN: Probably a good idea. Our thanks to Will Ripley in Kuala Lumpur. Thank for that report. Right now, in the search zone, the underwater drone, the bluefin 21, has just resurfaced from its 18th mission and again, it came up empty.

PEREIRA: Want to talk about the search that's ongoing. Joining us our safety analyst David Soucie and aviation analyst Jeff Wise. Jeff we'll start with you. Good morning to you ,first of all. What do you think now about the fact that the Malaysians are saying that they are going to send a resource to the Bay of Bengal? They first said, no, we're not going to bother, we are not going to redirect. We know a couple of frigates from Bangladesh were sent there. What do you think of this?

JEFF WISE, CNN AVIATION ANALYST: I would think they're taking this seriously.

PEREIRA: You think it's a pr move?

WISE: Yes. I mean frankly, I do. I don't think any of the experts who look at this company and their technical claims think they hold much water. But it's got so much traction. So many people are asking about it. Why not just go look. I think they're tired of arguing about it. It's easier just to go and get it over with.

BERMAN: David one of the glaring absences from this official report was any real mention of the Malaysian military. The military radar, that we believe picked up signals from the jet as it flew across the Malaysian peninsula. Today at the news conference about the report, the Malaysian defense minister was asked a very direct question about the military radar. When did the military radar pick up detection of this plane? When did the military communicate this with civilians? I want you to listen to his answer of this.

HUSSEIN: I don't have the actual details with me today, and I'm very caution and very careful what I say. So, it is very important for me to get verification on that. I'll get back to you.

BERMAN: This -- I was floored by this. Two reasons. One, he is the minister of defense and transportation and he has no information about what could be the most crucial element of this entire investigation. The military radar picking up traces of that plane. The other thing, he laughed, he was chuckling there. I couldn't tell what was going on.

DAVID SOUCIE, CNN SAFETY ANALYST: It was like one of these. Not me, who knows. It's really, really unprofessional and again, the defense minister, that's the first thing he should be looking at. When we lack at what the radar does, the fact there's no communication between the radar, that's a severe problem. That's how we got into more trouble in 9/11 because we didn't have that either. Now, we do. Now, those things are interchangeable. Sometimes, radar technicians from military are sitting right next to the civilian radar technicians. So that communication occurs now. What surprises me is that the ICAO, that the ambassador from the U.S. didn't take that. Didn't say look, this is a standard we expect. That's what the purpose is, when we go to another country, we're going to have the same standards, or at least a close proximity. Why are they still in this old system and not communicating?

PEREIRA: There's so many pieces that are making us ask those very questions. I want to talk to both of you, David I will start with you and then Jeff we will get you to sound off. Monday, we know that Malaysia, Australia, China, are going to hold this trilateral meeting. What do you think is going to be addressed? What do you think is going to come out of it?

SOUCIE: I think a lot will come out of it and it's a good sign in my estimation. I really feel like they're opening up and saying we need additional help. We're going to talk about new contractors, about new people coming in. They've actually reached out to our safety investigation community with some specialists over there and so I think they're really reaching out. They're saying we expect to find the airplane. Now, we're going to need help with how we're going to investigate it once we do. I was encouraged by that. Particularly the part about bringing in additional investigators and technicians, and people who have the backgrounds in investigation.

PEREIRA: Jefferey are you as hopeful?

WISE: Well, you know, I think it's a good trend they're on. I hope that they do continue it. There are so many big mysteries remaining. I think the biggest, frankly, is they still haven't explained what their reasoning is to the position of the search area. One of the interesting things they released in their report, this chart showing their paths of probably flight paths and the speeds the plane would have to be flying in order to follow that trajectory. Very strange speeds. Like 320 knots, up to 350. Then slowed down again. It's hard to imagine why you would fly an airplane in that way.

BERMAN: Jeff Wise, David Soucie, great to have you here with us. Have a great weekend, guys.

WISE: Thanks

SOUCIE: Thanks for having us.

PEREIRA: Ahead @ THIS HOUR, as tensions explode in Ukraine. Is diplomacy a lost cause? President Obama and Germany chancellor Angela Merkel meeting this morning at the White House. They are expected to address reporters in just minutes. We'll bring that to you live.

BERMAN: And next, one call from a concerned citizen might have prevented a possible school massacre. That is an amazing story. Details, next.