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Russian Military in Ukraine; Crisis in Crimea; International Sanctions Against Russia Possible; Presidential Delegation Withdrawn from Sochi Paralympic Games

Aired March 3, 2014 - 12:00   ET



ASHLEIGH BANFIELD, CNN ANCHOR: Ukraine's identity crisis quickly escalating into a world crisis. Russia seizes control of another nation's land, defying the west, threatening to undermine peace in Europe. Ukraine calls it a declaration of war.

Also this hour, bombshell testimony in day one of the blade runner murder trial. Could blood curdling screams supposedly heard before the gunshots actually rang out, could they blow a hole in Oscar Pistorius' defense?

And it's getting worse by the minute. Snow piling high. Temperatures falling fast. States declaring emergencies as the latest deadly winter storm marches on.

Hello, everyone, I'm Ashleigh Banfield. It is Monday, March the 3rd, and welcome to LEGAL VIEW.

It's being called the biggest crisis in Europe in the 21st century and it is growing by the hour. It is the sudden occupation of Crimea in southern Ukraine by Russian forces in nondescript uniforms. And the source of that quote is the British foreign secretary, William Hague, who turned up today in Kiev, the Ukrainian capital, in a show of solidarity with that country's newly formed pro western government.

Secretary of State John Kerry is due in Kiev tomorrow. Today, Vice President Biden spoke with the Russian prime minister, urging a quick pullout of the Russian forces, the entry of international monitors, and dialogue with Ukrainian leaders. At last report, 10 Ukrainian military bases in the pro-Russian Crimean peninsula were surrounded by thousands of Russian fighters. And though the standoff so far has been mostly peaceful, now comes the ultimatum. Russian's Black Sea fleet is warning Ukrainian troops in Crimea to surrender, all out, by 5:00 a.m. tomorrow, that's 10:00 p.m. Eastern Time here in America, or face attack.

Earlier, the Ukrainian prime minister vowed never to give Crimea away. And a former prime minister told CNN that Moscow plans to take it.


YULIA TYMOSHENKO, FORMER UKRAINIAN PRIME MINISTER (through translator): Literally, several minutes ago, the Russian Duma has started listening to the (INAUDIBLE) the law (ph) of annexation (ph) of Crimea from Ukraine. It's only a question of time when it will be voted. We'll know that votes in Duma will be found. That's why Russia is escalating the crisis now, and the world should understand, should realize that Ukraine, on its own, won't be able to solve this issue with Russia on its own. Absolutely not possible.


BANFIELD: Well, it is not at all clear what the world can or will do to make Russia pay for this power grab. But check out the price that you personally are paying. Wall Street definitely spooked by what's going on, by the prospects of what some are saying could be a new Cold War or worse. Blue chips sinking at the opening bell. And your 401(k) likely sinking right along with them. Got much more on that in a moment.

But first, I want to get to my CNN colleagues in the region, Matthew Chance in Kiev and Phil Black in Moscow.

So, Phil, first off, talk about this newest development, this ultimatum. It certainly did ratchet things up.

PHIL BLACK, CNN CORRESPONDENT: Yes, indeed that's right, Ashleigh. So what we understand from the Ukrainian defense ministry, and this is the most significant of a number of ultimatums that Russian military have given over the last 24 hours or so or really throughout this crisis, but we understand that the chief of the Black Sea fleet, the Russian Black Sea fleet, boarded a Ukrainian vessel in Sevetapol (ph) Harbor and basically said, you've got three choices, you can swear allegiance to the new Crimean authorities, you can just simply surrender, or you can face attack.

It at the moment, Ukrainian defense officials haven't confirmed for us that there is a time attached to this deadline, but they say that they have been receiving numerous deadlines in recent days and they believe that this is part of an ongoing psychological tactic by Russian authorities, by the Russian forces, to try and drive them into surrendering and giving up their arms, Ashleigh.

BANFIELD: And then, Phil, what about this new draft legislation that's being reported out of Russia right now effectively changing the rules, saying that we can annex Crimea because there's really no consensus on international law, among other things. Is this going to be debated or is this effectively -- it's just a fait de compli (ph) at this point?

BLACK: Well, at the moment, it's still in its early stages. But what this draft law does or draft amendment to a law does is outline the process by which a country or part of a country can seek to be annexed by the Russian federation. And it talks about a scenario where a sovereign state is breaking down, there is no central government control, people's rights are not being protected. And under those circumstances, a country, or part of that country, can indeed hold a referendum and vote to join the Russian federation. And under those circumstances, that would then become a legally binding thing that Russian could agree to. It is, as I say, only at the early stages of a draft. It's going to committee. It's unclear how soon this could come before a parliament. But an explanatory note attached to this legislation makes it very clear, that this is absolutely being driven by the events in Ukraine there.

What we don't know yet is what sort of support this has from the Kremlin. Whether this is something that is really being created from the top down. Whether President Putin is really calling for this. But I think that if you look at everything that's happening on the ground in Crimea with Russian military control, with Crimean authorities calling for a separatist referendum and now this move in the Russian parliament, it all means that one way or another, either as an officially annexed part of Russian federation or perhaps just simply a client state of the Russian federation, Russia intends to maintain control of the Crimea beyond this initial military operation in that region.


BANFIELD: All right, Phil, stand by for one moment. I want to go to the ground, in to Ukraine, to the capital of Kiev.

So, Matthew Chance, perhaps you could just give me the feel for someone else in our - in our -- among our colleagues called this a bit of a low-key invasion in Crimea, which is a very unusual description for what's going on right now, especially since we just had this very frightening ultimatum issued by Russia. The reaction right now in Ukraine is that the calm before the storm or is it the calm before the inevitable?

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: I think it has been very low key indeed. I mean, in fact, not a shot has been fired, really, in anger, as Russia established its grip militarily over that region of Crimea. They've now essentially either surrendered or occupied the key installations, both civilian and military, inside Crimea. They've deployed thousands of their troops inside Crimea, as well. And now their military forces far outnumber the numbers that the Ukrainian military in Crimea would be able to muster. So they've essentially establish their de facto control over that entire area.

Throughout the course of the past 24 to 36 hours, various groups, the Russian army, the pro-Russian militias, have been going to various military bases around Crimea and issuing these ultimatums, saying that you've got to surrender or defect or face a storm, as they call it. This has been taking place throughout, as I say, the last several hours, last day or so. There's not a general deadline, according to the Ukrainian authorities, as far as they understand it, that would mean, you know, beyond this point there will be a general attack on your military installations. But certainly it's a threat they're taking seriously. They regard it as a psychological sort of sense of warfare, these ultimatums that are being issued.

But, yes, a very delicate situation. The ball is very much now, I think, in the Russian court as well because they've established this control over Crimea. Will they now look at other areas in the east of Ukraine that are also Russian-speaking and are also ethnic Russian majority areas and say, well, you know, these are our rightful areas, as well. Maybe we're going to go into there.

BANFIELD: All right, Matthew Chance reporting live for us in Kiev, and also Phil Black in Moscow, thank you both. Stay tuned, though, because things are changing moment by moment. So we'll continue to tap our resources that CNN has all around the world, including right there on the ground in those key regions.

Now, in the crisis in Ukraine, the ultimatums and the threats are flying and the world financial markets, they are paying attention to the tune of, I don't know, down 226 on the Dow. It's critical for Americans, even if you don't pay attention to this region, you pay attention at the pump and at the grocery store and Christine Romans is going to break down how this affects you actually today. That's coming up next.


BANFIELD: As we've been reporting in the crisis in Ukraine, this is really a diplomatic crisis first, and then potentially combat crisis if what the Russians are threatening actually comes into fruition by the ultimatum time of 5:00 a.m. tomorrow morning local time, 10:00 p.m. American, or at least Eastern Time, tonight. So with the diplomacy at the forefront, Secretary of State John Kerry has announced he's going to be giving a live news conference and an availability to the press in about 16, 17 minutes from now. So we're going to keep our live cameras trained in Washington for the secretary when he appears. And we will bring that to you live. Again, Secretary of State John Kerry to speak live and take questions in -at the bottom of the hour. So just about 15, 16 minutes from now.

I want to talk about the fallout, though, from it this Crimea crisis. Ukraine, Russia, the big powerful Russia, President Putin and him saber rattling. You know that our chief business correspondent Christine Romans has a lot to say about this because it has a big effect on your pocketbook. And I'm also joined by Christopher Hill, a former U.S. ambassador to Poland, Iraq, Macedonia and South Korea, and now the dean of Korbel School of International Studies at the University of Denver.

Ambassador, if I could start with you. The issue at hand, when we talk about diplomacy, there are all sorts of ways that diplomacy can appear. Some of it can be very, very threatening in terms of finances. Others can be geopolitical. But talk to me a little bit about what makes President Putin tick. Which issues of diplomacy work best? Do any of them work with a man like this?

CHRISTOPHER HILL, FORMER U.S. AMBASSADOR: Well, first of all, I think the U.S. has very wisely decided to try to work this internationally, get as many countries together on this, on the same sheet of music. And I think they've done very well in that regard. Now whether Putin carries about this, it's hard to say. His foreign minister said today that they've had very good conversations with China. And what they're trying to say is, if you try anything in the U.N. -- in the U.N., it's going to be vetoed by the Russians and by China. So it kind of closes off any U.N. Security Council resolutions.

So, I think the Russians kind of feel that they're ready to go forward, and it's very clear that Putin has his war paint on. He is really resolved to go ahead.

So, the second set of diplomacy will be whether there is anything left between Kiev and Moscow, whether they can work out any kind of deal, and certainly what we're hearing about Crimea, first of all, the expected autonomy resolution there, secondly, what the Russian Duma is doing. And sometimes they'll be outflanking Putin on the sort of nationalist side.

So, even if he doesn't want to do all of the things that Duma wants to do in terms of annexing Crimea, he's going to have a tough time slowing down that freight train.

So, the issue is a lot of things going on right now and moving very fast. And before everyone is put into forced moves where there is no coming back, there's no, you know, choices involved, I think it's very necessary to get people in Kiev, get the lines open in Moscow and see what we can do.

It's important. However, so far the Russians have not moved in the rest of Ukraine, and so as of now, the crisis is in Crimea. The crisis is not yet to dismember Ukraine.

BANFIELD: Hold that thought for a moment, if you would, Mr. Ambassador. I want to bring in Christine Romans.

When it comes to the diplomacy of money, there are a lot of things that America could do. There are a lot of things other nations could do.

But again, a lot of things we would have to deal with in terms of backlash from a man as strong as Putin.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: You're talking about sanctions. What if the United States were to have sanctions, like maybe travel visas would not be allowed or asset freezes? I mean, then you get into this very complicated and very dangerous situation with the Russians.

But right now, you have markets that are actually reacting as a diplomat, almost. You've got the Russian stock market down 13 percent.

BANFIELD: Does that affect me if I'm in Nebraska? Does that affect me if I'm in Idaho? Does that affect me if I'm in California?

ROMANS: What that is doing, the Russian market reaction is putting pressure on Putin, I think to make sure they make a wise next step. What you're seeing with the ratcheting up of tension is grain prices higher. That's something, if it persists, you will feel at the grocery store. Gas prices higher, that is something you will feel.

BANFIELD: Are these numbers today, like right now? These numbers are a direct effect of what's happened in the last 48 hours? ROMANS: Absolutely. And that's wheat up 5.7 percent, because maybe you didn't know it, but Ukraine is a big grain producer. It feeds Europe. It exports the rest of the world.

And then U.S. stocks are down.

BANFIELD: It's like Canada East. Honestly, it seems like there is so much topographically the same (inaudible)

ROMANS: And these pipelines that take Russian oil and natural gas into Europe, and into these important terminals along the Baltics.

There you go. Here's the issue for your money. You've got futures down, or you've got stock markets down here and around the world. You've got these commodities rising.

Clearly, what the markets are telling us is this is incredibly unsettling, that money around the world is moving because they fear what's happening, and they have just got to tamp this down.

No one likes this kind of uncertainty and it's certainly -- it will certainly roil our pocketbooks

BANFIELD: Ambassador Hill, if you could weigh in for a moment, please, on the voices that are speaking out diplomatically, and even more so, regarding President Putin's latest moves, the G-7 has been very vocal, threat to think pull out of the G-8 meetings in Sochi later in June, there have been no shortage of voices that have condemned what President Putin is doing, and then there have been those who haven't said a word.

And I'm curious about your thoughts about, say, China, and countries of that ilk. Are they just as powerful in their silence as those like America are in their condemnation?

HILL: I think the Chinese are going to avoid taking a public position, unless it comes to the U.N. Security Council.

But when it does come to the U.N. Security Council, I don't see the Chinese really joining with us and sanctioning Russia in any respect, and I think the Russians are watching that Chinese flank very carefully.

So, the thing about this crises is this involves one of the great powers. This involves Russia. We haven't had that kind of crisis in a while.

And Russia is a big player in a lot of these international organizations, especially like the OSCE. They have talked about getting these civilian monitors into Russian areas of Ukraine. I think that's going to be tough unless the Russians agree to that, and similarly in the U.N. Security Council.

So, I think what is really moving the markets, though, as you talked about, was the pipeline situation. Many of them go through Ukraine.

And it's not to be ruled out the Russians would say to the Europeans, you want to play this game with us, we can stop supplying your gas.

So, there are a lot of nasty things going on right now, and for that reason, I think understandably, stock markets are down.

BANFIELD: All right, Ambassador Christopher Hill and our chief business correspondent, Christine Romans, I thank you both for your input in this.

And I also want to remind our viewers that here at CNN we're watching very carefully these developments that are coming in, moment by moment.

And we're expecting increasingly significant developments in about 11 minutes from now when Secretary of State John Kerry comes through those doors and addresses the press.

He's going to answer some questions and speak about the situation currently in the Ukraine.

I've also got a little bit more breaking news here, as well, that the Russian president, Vladimir Putin, has been on the scene of military drills in western Russia, all of this happening today.

He's called for snap drills and surprise inspection of troops, as well, in western and central military districts. I'm just reading this as a get it.

The drills involving about 150,000 troops, 90 different planes, this is very significant. The numbers are in -- are pretty intense, 120 helicopters, 880 tanks, 80 different ships, all of this according to the Web site of Russian's presidency, and Russian state media, as well, for what that is worth.

But there you go. The show of force that President Putin insists that the world see at this point, escalating now in these war games that he's now on the scene of.

And as I said, the secretary of state having to probably digest a lot of this as he crafts his remarks that are due in about nine minutes or so from now.

Quick break, right back with the breaking news after this.


BANFIELD: A little bit more breaking news to bring in the crisis in Ukraine, the United States is pulling one punch this morning, anyway, this coming from the White House.

Say what you will about foreign policy, but sometimes the policy of sport has implications, and the United States is now announcing it will no longer participate in the Paralympic Games in Sochi, this after the Olympic Games have just wrapped up, the Paralympics getting under way in Sochi and the United States saying it's no longer going to send a presidential delegation.

Now, that is significant, but it does mean that the athletes will still be able to compete.

And the president says that he continues to strongly support the U.S. athletes in their competition in Sochi, but that there will be no American delegation going.

And with that, I want to get to CNN Michelle Kosinski live outside the White House. I read statements like that and think that's interesting, but I just don't know whether there is a lot of teeth to something like that. Maybe you could put it into context for me, Michelle.

MICHELLE KOSINSKI, CNN WHITE HOUSE CORRESPONDENT: That has been the big question about all of these small steps, kind of sending a message first before what some might call real action is taken in the form of sanctions, which many lawmakers have been calling for.

The Paralympic issue, that was actually mentioned by Britain yesterday, saying, is it really appropriate to be sending a delegation in light of what has been going on?

Today, the White House just announcing it won't be sending a presidential delegation up to the Paralympic Games, blasting Putin's actions, calling them unacceptable and warning Russia that continuing on this path would only lead to severe international isolation.

And then we have seen steps of action. First, cancelling upcoming trade talks with Russia, cancelling preliminary meetings leading up to the G-8 which is to be held in June in Russia, warning Russia that the U.S. and other nations may, in fact, not even attend the G-8 and taking it a step further with a warning that Russia could potentially be kicked out of the G-8 and other international organizations.

So, we have been seeing, you know, one more step, one more step.

And we also know that this morning, Vice President Biden called Russian Prime Minister Dmitry Medvedev.

The White House has put out a little bit of detail on it. We've pressed them for more, especially Russia's stance during that call, because we already know that President Obama's call with President Putin over the weekend seemed to have gone nowhere.

What the White House said was really there were three points raised, urging Russia to pull out troops, allow for the immediate deployment of international monitors, which has been presented as a real solution to the reason that Putin has given for sending troops into Crimea, to protect Russian people there, and their interests.

And the third point was to start a meaningful political dialogue with this new government in Ukraine, which they have said, which Ukraine has said, it is more than willing to do.

So, now it's -- we see these steps. We hear the warnings. Actions are taken, not only by the U.S., but in a coordinated effort with other Western nations. But any movement such as the call between German Chancellor Angela Merkel and Putin over the weekend, after which Germany announced that Putin accepted their proposal to start a dialogue.

This is in direct contrast to what we're hearing actually happening in Crimea, which is an ultimatum that if Ukrainian troops don't pull out there, that Russian troops will flood Crimea.

BANFIELD: Michelle Kosinski, thank you for that.

And by the way, welcome to our lineup. Michelle is just new to CNN. It's good to have you with us -

KOSINSKI: Thanks, Ashleigh.

BANFIELD: -- and great reporting from the White House, Michelle Kosinski for us.

Just want to make mention, as well, as we await the secretary of state, John Kerry, expected to speak in about two-and-a-half minutes or so, you know, there has been a lot of sort of war of words here in America, as well.

The senior senator, John McCain, has accused this administration of having a feckless foreign policy, and now comes Senator Kerry to talk about that foreign policy, perhaps more diplomacy, perhaps not so much diplomacy.

We have our live cameras trained. We'll be right back after this.