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California Lagging Behind Other States to Reopen Schools; 730,000 Americans Filed for First-Time Jobless Benefits Last Week; South Dakota Attorney General Urged to Resign Over New Evidence in Fatal Crash. Aired 11:30a-12p ET

Aired February 25, 2021 - 11:30   ET



LT. GOV. ELENI KOUNALAKIS (D-CA): School districts are the ones who get to make the final decision. What the governor and the legislature can do is offer resources and financial support to be able to get there. We have to continue to talk to them to try to create the right conditions that they're comfortable going back and feel safe about it.

It is a very difficult situation. And for your viewers, you know, about 80 percent of the students in the Los Angeles School District live at or below the poverty line. We're talking about people who live in very close quarters, people and students who live in multigenerational families where they come home from school and they're living with grandparents. We need to make sure we're getting into the communities not just making sure that the schools are safe, but that the homes that students are coming from are also safe.

So this is complicated.

KATE BOLDUAN, CNN NEWSROOM: Absolutely. And, look --

KOUNALAKIS: It is difficult. But we want to make sure that we do this in a way that is safe for everybody.

So, the negotiation is ongoing. The governor has said that feels very strongly we should be able to do this without every person being vaccinated. At the same time, we are making bit allocations to get doses available to educators.

BOLDUAN: Yes. The governor is facing a recall effort right now, sparked by his response to the coronavirus pandemic. And a big part of it is schools. You have been very clear, Lieutenant Governor, your support for Governor Newsom. How likely is it that he's going to face a recall election?

KOUNALAKIS: Well, Kate, we don't know yet. It is this process that does not happen that often in California. But it does appear that the Republican effort to collect signatures, 1.5 million valid signatures are needed. It is very well funded now. It was fueled by, of course, discontent. This is a global pandemic, it is a very difficult time. Nothing is perfect. But it does look as though there is a likelihood that it will qualify. And then the governor is going to have to make his case.

But he is still quite popular in this state. People recognize he's been dealt a very tough hand. And I'm very hopeful, first, of course, I believe that he does not deserve to be recalled but I'm also hopeful that Californians will recognize that this is a Republican-driven effort built on a fantasy that they can slip a republican governor into the blues state in the country.

So it will be a noisy, chaotic distraction from the task at hand, but if it qualifies, we're going to have to fight it.

BOLDUAN: And that is the key. Sorry, Lieutenant Governor, then that is part of the key, is these aren't just some signatures that come in. These are vetted and validated, qualified voters who are signing on to say that they are not satisfied with the governor and that would be in support of a recall election, no matter who it is funded by. These are coming from the voters who signatures say that they support seeing a recall election.

And it is interesting that you think that there is a good likelihood that this is going to happen.

KOUNALAKIS: We just don't know, but it does appear that the numbers of generation of signatures will get to that 1.5 million threshold. I'm not personally involved in that, so I'm not -- I can't tell you for sure.

BOLDUAN: Because you have a role in the whole process, which is part of it, for our viewers to know, is that if it qualifies, it is up to you to formally call the recall election. If it would qualify, it has to be qualified by April 29th.

There is a lot of red tape though that is involved in the process afterwards. When do you expect that you would formally call the recall election if it is validated, if it is qualified?

KOUNALAKIS: Kate, it is too early to be able to answer that question. We just don't know yet. We have to see if there are enough signatures that are validated and then we have to look at the calendar.

But the fact of the matter is that the governor still remains popular, that his focus and all of our focus in elected office is getting people vaccinated, getting doses distributed, getting our kids back in school and getting people back to work.

And we're moving forward in reopening our economy. We look here in San Francisco that next week, indoor dining in restaurants is likely going to be able to resume. So we are focused on that reopening on ensuring that we do the best that we can for the California economy and for the health and safety of our people.

If there is a recall, we'll deal with it. But, again, I really do believe that Californians will see that the leadership has done absolutely the best possible job in this state. And people will be more looking toward the future than trying to condemn the governor for any mistakes that might have been made in the past. [11:35:04]

BOLDUAN: Lieutenant Governor, thank you for your time. Thanks for taking the questions. I appreciate it.

KOUNALAKIS: Thank you, Kate.

BOLDUAN: Still ahead for us, the weekly jobless numbers just out. What they show about the health of the economy and why the fed chair says America's unemployment is actually probably quite a bit worse than the statistics show.



BOLDUAN: 730,000 Americans filed for first time unemployment benefits last week. That is less than expected. But according to Fed Chairman Jerome Powell, the nation's unemployment problem is worse than it appears.

The country's the official unemployment rate was just 6 percent last month. But Powell believes it is closer to 10 percent.

His alarm comes as the House is preparing to vote on the massive coronavirus relief package tomorrow. It is expected to pass on a party line vote. And just moments ago, House Speaker Nancy Pelosi spoke out about what she says is the need to pass the emergency relief.


REP. NANCY PELOSI (D-CA): Over 75 percent of American people support the legislation overwhelmingly. Democrats, Republicans and independents support the legislation. So, hopefully, by the end of the day tomorrow, it will be passed and then prepared for to send over to the Senate by Monday morning.


BOLDUAN: But will it be enough to speed up America's economic recovery?

Joining me right now is Chief Economist at Grant Thornton, Diane Swonk. It's good to see you again. I really would love your perspective on all of this right now.

You've got -- on the one hand, you have, first and foremost, the number of weekly jobless claims going down but you also have this warning from the Fed chairman yesterday that was really quite a warning. How did you make sense of the how the economy is really doing right now, Diane?

DIANE SWONK, CHIEF ECONOMIST, GRANT THORNTON: Well, what we've seen is we saw a slowdown in the fourth quarter. We have had three months of negative retail sales. We actually lost some employment at the end of the quarter and then January was kind of a flat month. We got a bounce back in retail sales because of that stimulus that was passed on the $900 billion on December 27th, signed into law.

And so what we've seen is how contingent the economy is on both the course of the virus and the need for aid and stimulus for people who have really suffered through no fault of their own.

I think it is also important to note that you have to add on to those initial claims, the special pandemic unemployment insurance that is extended to gig and furloughed workers that puts it over a million for the week that just ended February 20th. And some of the decline came from the fact that we had a deep freeze and actually electricity outages in parts of the oil patch where people literally couldn't file for unemployment insurance so we could see a bit of tick up.

At the end of the day - I think Chairman Powell made a very important point. He also pointed to the low wage unemployment rate. Those hardest hit by this crisis have unemployment rates over 20 percent.

And I think that is very important to understand is that we really have a year into the crisis, 49 weeks of unemployment insurance claims worse than anything we saw just on the initial ones, not the extensions than we saw during the great recession in 2008 and 2009 and in any one week and I think that is important.

The other important issue is that many of the extensions to unemployment insurance are about to expire again in March. And, already, there is fears, many people haven't received what they could get with the 900 billion that was passed. That's going to expire in the middle of March. And there is worry about another lapse for those people who are most in need.

BOLDUAN: You don't have to be a chief economist to understand like fits and starts and stops and beginning again is just no way to run a railroad and no way to really keep economic recovery going or even started. That is obvious.

On the COVID relief bill, you have got Capitol Hill and one big part of it has become minimum wage, Diane. And Capitol Hill is right now kind of all over the place on the minimum wage part of this. What do you think a minimum wage increase to $15 an hour would mean for the economy?

SWONK: Well, we know that the Congressional Budget Office has said it could cost up to 1.5 million jobs, but, and this is the important but, but it could also lift a million people out of poverty. So we have to weigh those tradeoffs, and out of the 1.5 million jobs are some of those double jobs that people actually have. So I think that is important.

And I think what we've also seen out there is that minimum wage increases at the state and local level, regardless of your political stripes, are being voted in and have been voted in overwhelmingly, so in every state that has put it on their ballot since 2014. So the effective minimum wage is actually much higher for the overall economy, but there are some states that it is much lower and you do want to phase it in for those states, so especially as we're coming out of this, those small businesses that have the hardest time meeting the minimum wage are not put out of business.

So I think we could deal with that. But right now, the debate is not even that nuanced. And I think that is the hard part, is that you often lose in translation what the reality is what of the economy is doing.


BOLDUAN: Yes. And you mentioned states. That's another part of the package that Democrats are supporting, Republicans are not, this $350 billion of money to help state and local governments. The Democratic mayor of Milwaukee was on with me, and he said very clearly, we definitely need this. Republicans do not think that is true.

I mean, what impact do you think that kind of chunk of money would have?

SWONK: Well, we're down over a million jobs at the state and local level back to the early 2000s level in state and local employment, and we know from the crisis of 2008 and 2009 that actually it was because of the state and local level and a loss in employment through 2013 that made it a subpar recovery in employment.

So the very moment that you want everyone coming back, you could have state and local governments cutting even deeper into the budgets. And even though some states fared better than others, what they do have in the bill is differences to be able to go to states that got hit harder, like states like Florida or Nevada, that got hit harder in the service sector would receive more funds. So I think that is important as well.

Even though the amounts are a little more than some have estimated, there are also a lot of shortfalls, it's not being counted. It's how much the states have paid deal with COVID, how much they put upfront in terms of costs, so even though the revenues might not have fallen as short as many thought. Many local governments did have real shortfalls and you need to plug the holes and learn a lesson from the 2008/2009 crisis and do the transfers to the states.

This is something I don't think is at risk of overheating. And I think it is really important if you really want to ensure that the employment recovery is more full.

BOLDUAN: Very interesting.

SWONK: Remember also, a lot of the jobs that were low wage jobs we're losing permanently now too.

BOLDUAN: That is exactly right. Thanks for that. Diane, I really appreciate it, thank you so much for your time.

Coming up for us, police are revealing disturbing new details about a deadly car crash involving the attorney general of South Dakota. Now, calls for his resignation growing louder.


BOLDUAN: The governor of South Dakota is now calling on her attorney general to resign after new evidence was just released of a deadly car crash that he has been charged for. The attorney general initially claiming he had hit a deer in the car crash, but the victim's broken eyeglasses were found inside his car.

CNN's Lucy Kafanov has the details.


JASON RAVNSBORG, SOUTH DAKOTA ATTORNEY GENERAL: And then, quite frankly, wham. I hit -- the incident happened. I never saw anything.

LUCY KAFANOV, CNN CORRESPONDENT (voice over): South Dakota Attorney General Jason Ravnsborg is facing misdemeanor charges after he struck and killed a man on September 12trh. He initially told police he hit a deer.

UNIDENTIFIED FEMALE: 911, this is Ally, how can I help you?

RAVNSBORG: Ally, this -- well, Ally, I'm the attorney general, and I am -- I don't know. I hit something.

KAFANOV: Ravnsborg told investigators he returned to the scene of the collision the following morning and discovered the body of 55-year-old Joseph Beaver.

RAVNSBORG: But then I came back and it was a man, and he is dead.

But I believe I did not do anything wrong, and I obviously replayed it in my mind about a thousand times.

KAFANOV: But now the, Republican official is facing mounting calls for his resignation in light of disturbing new details Thursday night in which investigators said they found Beaver's broken glasses in Ravnsborg's car.

UNIDENTIFIED MALE: They're Joe's glasses. I wondered about that. So that means his face came through your windshield?

RAVNSBORG: It's a tough thing. I was thinking his face did not come through because -- I would have thought there would be blood everywhere then. And now that I've thought about it.

UNIDENTIFIED MALE: Yes, and you've had time. His glasses are right there, Jason. Those are Joe's.

KAFANOV: The attorney general faces three misdemeanor charges for careless driving, operating a vehicle while using a mobile electronic device and illegal lane change while carelessly driving, crossing lanes of traffic unsafely, but no felonies in the death of Beaver.

MICHAEL MOORE, BEADLE COUNTY STATE'S ATTORNEY: At best, his conduct was negligent, which is insufficient to bring criminal charges in South Dakota.

KAFANOV: The attorney general's spokesperson, Mike Deaver, tells CNN that Ravnsborg has not yet responded to the misdemeanor charges filed against him by

the state attorney's office and a court date has yet to be set.

On Tuesday, a bipartisan group of South Dakota lawmakers began impeachment proceedings against Ravnsborg.

TIM GOODWIN (R), SOUTH DAKOTA HOUSE MEMBER: But it's a sad day. But we need to move forward as a state. We need to do what's best for the citizens of South Dakota. So that's why I'm asking or recommending for our attorney general to resign his post immediately so the state can move on, the governor can appoint a new attorney general and we can get this behind us.

KAFANOV: Lawmakers introduced two articles of impeachment, one for the fatal crash, the other for Ravnsborg's statements and actions in reporting the crash and during the investigation, in which they said Ravnsborg undertook actions unbecoming the attorney general.

South Dakota Governor Kristi Noem is also calling for the attorney general to go, saying in a statement released Tuesday, now that the investigation has closed and charges have been filed, I believe the attorney general should resign.

But Ravnsborg is rebuffing calls to step down.


In a statement to CNN, Spokesman Mike Deaver said, the attorney general does not intend to resign. At no time has this issue impeded his ability to do the work of the office.


KAFANOV (on camera): Joe Beaver's life was cut short at the age of 55. His cousin told us that the family is extremely disappointed in the misdemeanor charges, but also not surprised. And that's because there is a lack of laws in South Dakota available to prosecutors and deadly cases like this one. Many states have something they called the negligent homicide law, South Dakota does not.

And so prosecutors were unable to pursue harsher charges. The family is now calling for a change to these laws and says they're going to file a case against Ravnsborg in civil court. Kate?

BOLDUAN: Lucy, thank you for that report.

Still ahead, Democrats divided over the Democratic president's cabinet nominees and his COVID relief package. What does this foreshadow for the rest of Biden's agenda?