Return to Transcripts main page

WOLF

Dow Plummets And Hits Record Low For 2015; North Korea In Wartime State; Obama Makes Another Push For Iran Deal; War Of Words Over Babies; Bill Nelson Talks Iran Deal; Mustard Agent Used. Aired 1- 1:30p ET

Aired August 21, 2015 - 13:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

WOLF BLITZER, CNN ANCHOR: Hello, I'm Wolf Blitzer. It's 1:00 p.m. here in Washington, 9:30 p.m. in Tehran and 1:30 a.m. Saturday in Pyongyang, North Korea. Wherever you're watching from around the world, thanks very much for joining us.

ANNOUNCER: This is CNN breaking news.

BLITZER: And let's begin with the breaking news with the stock market plummeting, once again here in the United States. Today, you can see what the Dow is doing. Down triple digits, once again. Yesterday, the plunge was nearly 400 points.

Let's go to New York. Our Business Correspondent, the host of "QUEST MEANS BUSINESS," Richard Quest, is standing by. Richard, what are the latest numbers? What's going on?

RICHARD QUEST, CNN BUSINESS CORRESPONDENT: The latest numbers are grim. They are red and they show is the Dow, as you see, off some two percent, more than 350 points. And if this holds for the rest of the session for the next three hours, then it will be the second day in a row that the Dow has lost more than 350 points.

The reason can be put very neatly into two categories. Firstly, what is going on with China? How bad is the economic situation there? Is the economy under control? And, secondly, how this is spilling into the rest of the world. The question of global economic growth. Bad manufacturing numbers in China. Some weak numbers out of the United States. And throw into all of that, Wolf, what is the fed going to do and when are they going to do it?

This week we had minutes from the fed that, frankly, meant all things to all people. Some believe its rates are going up in September. Some saw it as December. So, take that noxious mix, put it into the part of the summer, high volatility, low volumes and this is what you get.

BLITZER: You know, it's been a bullish market now for years. When President Obama, as you know, Richard, took office, the Dow Jones, January of 2009, was around 7,000. Right now, it's still 16,648. That's a very, very bullish market. But if you have these drops, are we beginning to see, and a lot of people fear this, either some sort of correction, as it's called, or a new bear-type of market? QUEST: There's no reason at all to believe that this is a bear

market, at the moment. A correction, perhaps. The Dow is down four and a half percent for the year so far in the sense of the gains that have been seen. If you look at other markets, Europe was down very sharply as well. But there's nothing out there that anybody is saying this is a full-pledged bear market and for good reason.

The U.S. -- even with China slowing down and these other problems, the U.S. will still have average growth, not brilliant, not subpar. Unemployment is still coming down and the environment in the U.S. is conducive to raising rates because, the fed tell us things are now getting back to normal.

In that scenario, Wolf, it -- some would say -- I've no doubt there are people who are calling it a bear market, but there's no reason to believe that at the moment.

BLITZER: Richard Quest is staying on top of the story for us. We'll stay in close touch with you, Richard. Thanks very much.

Other breaking news we're following, North Korea's leader certainly has a reputation for being dangerously erratic and an unpredictable dictator. Kim Jong-Un hates to be threatened so much that he has even executed members of his own family

Now, the clock is ticking for South Korea. Turn off the propaganda broadcasts in the next 15 hours or face war. That's the threat from North Korea. Point of contention, South Korea using these loudspeakers to blare criticism of Kim Jong-Un and his regime over the border. So, North Korea fired artillery at those speakers on Thursday. South Korea returned fire and pledged to respond sternly to any further provocation.

Let's go to CNN's Kyung Lah. She is near the demilitarized zone that separates North and South Korea. What's the very latest there, Kyung?

KYUNG LAH, CNN CORRESPONDENT: What we can tell you, Wolf, is that we have seen, in the last 24 hours, a ramping up of rhetoric from North Korea. This is leading to some very big concerns from not just South Korea but also the United States of whether or not there were will be some sort of miscalculation in all of this. This is a chess game between the two Koreas as well as the United States. They want to hold their positions but not cross the line. A game of chicken, if you will, without going too far.

So, at this point, Wolf, there hasn't been anything since Thursday. The question is what happens as that deadline -- that ultimatum that North Korea wants South Korea to stop blasting that propaganda, what happens as we get closer and then eventually pass that deadline -- Wolf.

BLITZER: Any indication from South Korea that officials there are going to bow to this deadline threat?

[13:05:03] LAH: Absolutely not. That is underscored. The South Korean government essentially saying, no way. We are not bowing to this ultimatum, to this threat. South Korea saying, we're going to keep blaring the messages from the propaganda loudspeakers. They're going to keep blasting that across the border to North Korea. And as the deadline ticks, if there is anything that comes to try to destroy those loudspeaker, South Korea's president has said that we will absolutely retaliate. Retaliate first, ask questions later is essentially what she's saying -- Wolf.

BLITZER: North Korea's Internet went down earlier today. I guess the question is, is that related to these growing tensions on the Korean peninsula?

LAH: Yes, the reason why we're so interested in this is because this is something that we saw during the Sony hacks. It was a big question of whether or not South Korea and North Korea were ramping up their cyber war. Well, some data that we're getting from Din (ph) Research, there are two specific breaks in Internet activity. We don't know why. We don't know anything about what could have caused this.

But what Din Research is saying is that there are two specific breaks within the last 24 hours. One that was three hours long. One that was approximately an hour long. The Internet essentially went off the grid. Shut off. Why? We just don't know. A lot of questions, though, is whether or not cyber warfare is also now in full effect.

BLITZER: The tension, obviously, very, very serious right now. Kyung Lah right near the DMZ separating North and South Korea. We'll get back to you as well.

Let's get some perspective on what's going on. I'm joined by the former U.S. ambassador to South Korea, Christopher Hill. Also joined by retired U.S. General Mark Hertling, he's a CNN Military Analyst, former commanding general for Europe and the Seventh Army, also served in Korea.

Ambassador, this is a major border provocation under the rule of the relatively new young leader, Kim Jong-Un. Is this different than what's gone on in the past? His father was, I take it, a little bit more predictable in these kinds of situations.

GEN. MARK HERTLING, CNN MILITARY ANALYST: Yes, I hate to refer to Kim Jong-Il as more predictable or more sensible. But certainly compared to Kim Jong-Un, you could kind of track your way out of these crises. But this one's a tough one.

First of all, the South Koreans have kind of had it with this. And, certainly, that August 10th incident in which a young South Korean soldier lost both of his legs to a North Korean land mine was pretty outrageous and considered so by the South Korean people.

So, I think we are into a crisis moment right now, and I'm not sure there's an easy way to deescalate this, at this point. So, I think we all have to, you know, keep our seat belts on.

BLITZER: Let's not forget, General Hertling, that there are, what, almost 30,000 U.S. troops right not -- not far away from this tension, along the demilitarized zone. There's almost a million North Korean troops along the DMZ, maybe a little bit further away. Almost a million South Korean troops. The stakes here are enormous. Here's the question now. How concerned should we be right now?

HERTLING: This is typical of this time of year, Wolf. It seems to be ratcheted up quite a bit this year when compared to past times. And the reason I say it's typical is because this is the time where the Korean forces, along with the U.S. and the rest of the allies that are based in South Korea, are conducting their Ulchi Freedom Guardian exercises.

So, this would be a horrible time for North Korea to do anything because all of South Korea right now is conducting wartime exercises. But, at the same time, this is something that North Korea does almost yearly on these anniversaries of these exercises. They do ratchet things up. But it seems the firing artillery, the planting in the mines, this brings it to a new level.

And one of the things that Ambassador Hill knows so well, as the sprawl -- the urban sprawl of Seoul has increased over the last several years. It is now under the arc of North Korean artillery range. So, it's dangerous. It's a provocation. But it's also typical for this time of year.

BLITZER: I assume South Korea, the U.S., Japan, others are going, Ambassador Hill, to China, for example. That does have significant influence over what's going on in North Korea, maybe even Russia which has some influence as well. How significant could these kinds of back channel diplomacy be in easing this current tension?

CHRISTOPHER HILL, FORMER U.S. AMBASSADOR TO SOUTH KOREA: Well, I would hope that they are all being used. But I would say that what makes this a little different from the past is the fact that the China-North Korea relationship just ain't what it used to be. I mean, the Chinese really don't have the contacts they used to within the North Korean government.

And certainly when Kim Jong-Un, you know, (INAUDIBLE) his uncle, Jang Song-Thaek, out of a party meeting and had him killed the next day. This was quite a blow to Chinese influence in North Korea.

[13:10:08] So, I have -- I have no doubt that all those channels are being used. The Chinese can't be -- can't be very amused by this. You know, they have a major event planned. They're going to have a major military parade. They must be furious, once again, with the North Koreans.

So, this is, I think -- I agree, these things happen every year and, you know, people find ways to deescalate. But we're dealing with a very fidgety and very difficult North Korean leadership. A man who continues to try to kind of prove himself. And the question is, at what point will he or can he pull back?

BLITZER: And let's not forget, General Hertling, and you know this, you served in South Korea, there are almost 30,000 U.S. troops there right now. And, hopefully, it won't happen but if artillery shells start going back and forth along the DMZ, those troops, they're in -- they're in major danger right now, aren't they?

HERTLING: They certainly are, Wolf. And that's part of the unfortunate situation in the Koreas right now. But, truthfully, those troops are in danger every single day as they're conducting patrols along the DMZ. Things are happening daily that most of America doesn't really understand. It's just the level of this provocation is significant for this time of year.

And, as the ambassador said, it's -- it seems to be greater this year than it has in years past. But, yes, troops are always in danger, especially in this hot spot. They consider the war ongoing. There's been no cease-fire. So, this is -- there's no peace between these two countries. It's a -- it's actually a situation of daily basis of conflict.

BLITZER: And let's not forget, North Korea does have a nuclear weapons capability right now. They may have 10 or 12, maybe even more, nuclear bombs capable of being launched. And hopefully that is not going to be a contingent right now but it's something certainly officials on all sides have to be concerned about right now. All right, we'll stay on top of the breaking news out of the Korean peninsula. Ambassador Hill, thanks very much. General Hertling, thanks to you as well.

Up next, new numbers show that most Americans don't like this pending nuclear deal with Iran. We're going to tell you about our new poll numbers, how President Obama is making a new push for support. We're going to talk live with a major supporter of the nuclear deal with Iran, Senator Bill Nelson of Florida.

And later, Donald Trump defends his use of a term many people find offensive, anchor babies. The latest on the war of words, the immigration policies, a lot more news, coming up.

[13:12:48]

(COMMERCIAL BREAK)

[13:16:51] WOLF BLITZER, CNN ANCHOR: President Obama may still be on vacation in Martha's Vineyard, but he's still pushing very hard for approval of the nuclear deal with Iran. The president made his point in an op-ed article that ran in about 30 newspapers nationwide. In it he said, and I'm quoting now, "here's my bottom line, if we are committed to preventing Iran from obtaining a nuclear weapon, the choice we ultimately face is between a diplomatic solution and what would likely become another war in the Middle East in the near future. The idea that we can get a better deal by talking tough or squeezing Iran into submission with more sanctions is simply not realistic."

Let's discuss what's going on. Joining us from Orlando, Florida, is the senator from Orlando - from Florida, Bill Nelson.

Senator, thanks very much for joining us.

SEN. BILL NELSON (D), FLORIDA: Thanks, Wolf. BLITZER: I know you support the president, you support this nuclear

deal with Iraq, but our new poll shows a majority of Americans, 56 percent, want Congress to reject the deal and they're not very happy with the deal. And if you go further, you - in our poll, we ask, how do you think the president is dealing, prove or disapprove of the way he's dealing with the overall relationship with Iran, only 38 percent approve, 60 percent disapprove. Why is he having such a tough time selling this nuclear deal to the American people and selling his overall strategy as far as Iran is concerned?

NELSON: Because it's complicated, Wolf. I am convinced that this deal is in the best interest to protect the interest of the United States, of Israel and our allies. I boiled it down too that from the fact that if we do nothing, if we reject it, Iran will have a nuclear weapon in a few months. And through this deal, we have the opportunity for at least 10 years, if not 15 years, to old off them developing a nuclear weapon unless they cheat. And if they cheat, we have an inspection regime that we will catch them and then we can deal with that with all the options that we have on the table.

BLITZER: Well, I guess the question is, why is he having such a hard time making that - making that point to the American public? And I'll go one step further. This new poll we have we asked, "how's the president dealing with ISIS"? Only 33 percent approve of the way he's dealing with ISIS, 62 percent disapprove. These are major foreign policy issues, yet the president's having a tough time with the American public convincing them that he's right. What do you say about that?

NELSON: Well, again, ISIS is complicated as well, as is the Iranian nuclear, and we're in the presidential election season and there's a lot of partisan politics going around. And, wolf, I think it's - I think it's very telling how our politics has shifting that so much of what used to be a swing in the middle that would elect moderate Democrats like me of eight to 10 percent, that swing is getting narrower and narrower, down to 2 or 3 percent, because people are retreating to their partisan sides. And that is spilling over when you get into complicated matters like the Iranian nuclear deal.

[13:20:28] BLITZER: Speaking of the presidential election season, there's a Quinnipiac University poll, and you've seen it, that shows that Donald Trump, the billionaire businessman, he would win a primary election in Florida right now, even beating the former governor of Florida, Jeb Bush, the current senator from Florida, Marco Rubio, 21 percent to 17 percent to 11 percent. Why is Donald Trump doing so well among Floridian Republicans?

NELSON: That's another indication of the change of our politics. He's blunt, he's direct, he's a celebrity and he is engaging. And you put all of those things together and we are in an era of celebrity politics. We are in an era of celebrity. But you put all of those things and it's not surprising that in Florida he's ahead of the two Florida -

BLITZER: So I just want to be precise, senator, you think that Donald Trump could beat Jeb Bush in Florida in a Republican primary? NELSON: Well, that's today is that poll. The long haul, the question

of substance, that is yet to be told. But as of today, obviously the poll is reflecting how people are feeling. Donald Trump is a very engaging fella. I have a - I really like him. You know, he owns Mar-A- Lago, the big house on Palm Beach. I see him from time to time. He's really an engaging fella. Now, the question is, will that translate into long haul as you get into the specifics? I don't know the answer to that.

BLITZER: Let's talk - let's quickly talk about the vice president of the United States, Joe Biden. I know you support Hillary for the Democratic presidential nomination, Hillary Clinton, but these polls show that if he were to throw his hat in the ring, he could beat Trump in Florida, this Quinnipiac University poll, Biden, 45 percent, 42 percent for Donald Trump. How worried are you that Joe Biden will become a Democratic presidential candidate and challenge your candidate, Hillary Clinton?

NELSON: Well, that's a tough question. Joe Biden was one of my best friends in the Senate. The Clinton family have been friends over and over. I am supporting Hillary. I think she's getting a bad rap on all of this stuff on the e-mails and I can explain it, if you want. But I don't think Joe Biden gets in at this point. I think he waits and sees, is Hillary going to survive all of this? Which I think she will. And it would only be later down the line if she were not to do well that he would get in. That's my personal judgment.

BLITZER: All right. And I know you - you're friends with not only Hillary Clinton, but with Joe Biden as well. So you'll have a tough decision to make if, in fact, he throws his hat in the ring, although right now you're with Hillary Clinton. We'll continue all the political discussion down the road, senator. Always good to have you here on CNN.

NELSON: Thanks, Wolf.

BLITZER: We've got breaking news we're following. Up next, we're getting new reports of evidence that ISIS has been using chemical agents. Stay with us.

(COMMERCIAL BREAK)

[13:28:10] ANNOUNCER: This is CNN breaking news.

BLITZER: And there is important breaking news coming into CNN right now. A U.S. general is now officially confirming that earlier this month ISIS fired at least one mortar on Kurdish forces in Iraq that contained sulfur mustard, which is a type of chemical warfare agent.

Let's bring back retired U.S. General Mark Hertling. He's our CNN military analyst, former commanding general for Europe and the Seventh Army.

So if, in fact, this is true and now we have confirmation from a U.S. general, what are the implications? Where do we go from here? GEN. MARK HERTLING, CNN MILITARY ANALYST: Well, the implications are,

first of all, Wolf, that this - this is a field test, so it has to be conclusively proven by laboratories. But, truthfully, I expected this to be the case. As you know, for those of us who served in Iraq multiple times, we found unbelievable amounts of caches of munitions. And if ISIS, does, in fact, have Ba'athist generals in their rank, they know where some of those caches are that we could not find, that we couldn't destroy. And I think what you probably are seeing is the use of some of the weapons and the equipment that were in those caches and certainly some of that might have -- may have been mustard rounds, mortar rounds. We found some of those, as some of your stories of late have said. So it doesn't surprise me at all.

But truthfully, it's probably at such a low level. It does contain gas, it's critical, it's a very dangerous substance, it causes blistering and incapacitation at the higher levels. But these rounds have been around for a while. They've probably dissipated in their content and their destructive power. So it's still an intimidation tool, but truthfully not unexpected that ISIS would find these kind of chemical rounds and use them on the battlefield.

[13:29:57] BLITZER: They could obviously find them left over, as you point out, from the Ba'athist regime of Saddam Hussein in Iraq. And all of us remember that that regime used poison gas against Kurds back in the 1980s.