WEBVTT - Carnival Knew It Had a Virus Problem, But Kept the Party Going 0:00:00.120 --> 0:00:03.120 Hi, I'm Carol Masser and I'm Jason Kelly. Today we're 0:00:03.160 --> 0:00:07.160 bringing you this week's cover story, and wow, what a 0:00:07.200 --> 0:00:10.080 story it is, Carol. Yeah, it's all about Carnival, and 0:00:10.119 --> 0:00:12.680 it's really about what the company knew, when they knew it, 0:00:12.720 --> 0:00:15.240 and what they did about the virus. What's interesting is 0:00:15.280 --> 0:00:17.599 the tagline on it. Carnival executives knew they had a 0:00:17.680 --> 0:00:21.120 virus problem, but they kept the party going. Yeah, and 0:00:21.160 --> 0:00:24.040 as the story points out, the ships they become a 0:00:24.040 --> 0:00:28.440 floating testament to the viciousness of this new coronavirus. But 0:00:28.520 --> 0:00:32.400 they've also raised questions about corporate negligence and fleet safety 0:00:32.440 --> 0:00:35.880 and really it extends well beyond the cruise business. I 0:00:35.920 --> 0:00:38.400 think that's safe to say. Yeah, absolutely, Jason, I've been 0:00:38.440 --> 0:00:41.040 on a ship. I've done some stories about Carnival, talked 0:00:41.080 --> 0:00:43.600 with their CEO, Arnold Donald. You know, you go to 0:00:43.640 --> 0:00:46.360 one of these ships, they are massive, and you're talking 0:00:46.400 --> 0:00:50.040 about thousands of people that go on the ship for fun. 0:00:50.240 --> 0:00:54.520 You know, it's a tourist attraction. There's also hundreds of 0:00:54.520 --> 0:00:57.320 people who were supporting them in terms of employees, So 0:00:57.360 --> 0:00:59.920 you have a lot of people in a relatively tie 0:01:00.160 --> 0:01:02.880 in small space, and that's why when something like a 0:01:02.960 --> 0:01:06.560 virus hits even just one or two people, it really 0:01:06.560 --> 0:01:09.480 goes through the ship pretty quickly. Well, and this story 0:01:09.560 --> 0:01:12.800 does such a nice job of detailing what happened, a 0:01:12.920 --> 0:01:16.360 very critical timeline that they dig into, but also where 0:01:16.400 --> 0:01:18.880 we are now, because by the way, there's still ships 0:01:18.880 --> 0:01:22.480 at sea, and more importantly, maybe what happens next. Check 0:01:22.480 --> 0:01:27.520 it out, just try and social distance this. Carnival's crews 0:01:27.560 --> 0:01:30.479 executives knew earlier than most that they had a COVID 0:01:30.560 --> 0:01:35.120 nineteen problem. They kept the party going as long as possible, 0:01:36.080 --> 0:01:40.840 by Austin Carr and Chris Paulmary. The news when it 0:01:40.880 --> 0:01:44.280 reached the Grand Princess early on March fourth, barely registered 0:01:44.319 --> 0:01:47.480 at first. In a letter slipped under passenger cabin doors, 0:01:47.760 --> 0:01:51.680 Grant Tarling, Carnival's chief medical officer, announced that the US 0:01:51.760 --> 0:01:55.320 Centers for Disease Control had begun investigating a small cluster 0:01:55.480 --> 0:01:59.160 of COVID nineteen cases in California that might have been 0:01:59.200 --> 0:02:02.160 linked to the ship. Up thirteen days after leaving San 0:02:02.200 --> 0:02:05.480 Francisco for Hawaii, the vessel would be skipping a scheduled 0:02:05.480 --> 0:02:08.480 stop in Mexico on its return voyage. And sailing back 0:02:08.480 --> 0:02:12.639 early to its Bay Area port. That day, passengers noticed 0:02:12.680 --> 0:02:16.560 new hand sanitizer stations and crew members wearing gloves. But 0:02:16.680 --> 0:02:20.679 life on the Grand Princess, which advertises and one cabins, 0:02:20.919 --> 0:02:24.560 twenty restaurants and lounges, about a dozen shops, and four 0:02:24.639 --> 0:02:29.359 freshwater swimming pools, otherwise went on as normal. Guests prepared 0:02:29.400 --> 0:02:33.320 for a ukulele concert, played bridge at shared tables, and 0:02:33.360 --> 0:02:37.080 took line dancing classes. That night, Laurie Miller and her 0:02:37.160 --> 0:02:41.400 husband John attended True or Move, a show featuring an 0:02:41.480 --> 0:02:45.080 MC in a cow costume. The following morning, John joined 0:02:45.120 --> 0:02:48.600 about two hundred other passengers in the ship's Broadway style 0:02:48.680 --> 0:02:52.600 theater for a lecture on Clint Eastwood movies. I'm surprised 0:02:52.600 --> 0:02:55.080 they're even letting this event happened, he whispered to a 0:02:55.120 --> 0:02:59.639 nearby friend. This is a big crowd. Around lunchtime on 0:02:59.720 --> 0:03:03.760 March fifth, the ship's captain, John Smith announced a quarantine 0:03:03.800 --> 0:03:08.440 over the ship's public address system. All two passengers needed 0:03:08.480 --> 0:03:11.680 to go to their cabins to shelter in place. Lorie 0:03:11.760 --> 0:03:14.200 Miller was in the Da Vinci dining room eating chocolate 0:03:14.240 --> 0:03:17.720 peanut butter ice cream. Oh my god, she remembers, thinking 0:03:18.160 --> 0:03:22.240 this is real. Then she ordered more ice cream. Other 0:03:22.320 --> 0:03:25.720 passengers ambled to the ship's stores and dining areas too, 0:03:25.919 --> 0:03:29.840 to take advantage of the perks while they could. Everybody 0:03:29.840 --> 0:03:33.200 went to the buffet. Recall sixty one year old Debbie Loftus, 0:03:33.240 --> 0:03:36.720 who was traveling with her parents. I just thought, Oh crap, 0:03:36.840 --> 0:03:40.120 the ukulele concert is going to be canceled. Crowds of 0:03:40.160 --> 0:03:43.400 elderly guests filed to their cabins through narrow hallways and 0:03:43.440 --> 0:03:47.000 down the stairs of the ship's seventeen decks. Sixty nine 0:03:47.080 --> 0:03:49.760 year old Karen Deaver tried an elevator, only to find 0:03:49.760 --> 0:03:53.320 it packed with fellow passengers. So much for social distancing, 0:03:53.440 --> 0:03:57.520 she joked aloud. As the lockdown progressed, the ship became 0:03:57.560 --> 0:04:00.680 a fixture on cable news and social media around the world, 0:04:01.160 --> 0:04:04.280 live streamed by frustrated, scared passengers as if it were 0:04:04.320 --> 0:04:07.840 the Titanic of the TikTok Age of the first forty 0:04:07.920 --> 0:04:11.040 six crew and passengers who were tested to the virum 0:04:11.040 --> 0:04:13.680 of the first forty six crew and passengers who were 0:04:13.720 --> 0:04:17.599 tested for the virus twenty one were positive. President Trump 0:04:17.640 --> 0:04:20.800 suggested they should be prevented from disembarking. At the time, 0:04:20.839 --> 0:04:23.320 the number of confirmed cases in the US was still low, 0:04:23.760 --> 0:04:26.159 and Trump implied that the vessel's caseload would make it 0:04:26.200 --> 0:04:28.159 look like the US was doing a poor job of 0:04:28.200 --> 0:04:30.960 handling the pandemic. I don't need to have the numbers 0:04:31.000 --> 0:04:35.000 double because of one ship, he said. But this wasn't 0:04:35.040 --> 0:04:39.400 Carnival's first outbreak nor its last. In February, another of 0:04:39.440 --> 0:04:43.320 its ocean liners, the Diamond Princess, accounted for more confirmed 0:04:43.360 --> 0:04:47.760 COVID nineteen infections than any nation except for China. Since then, 0:04:48.000 --> 0:04:51.320 no cruise operator has been hit harder than Carnival. At 0:04:51.400 --> 0:04:53.760 least seven more of the company's ships at sea have 0:04:53.839 --> 0:04:57.880 become virus hotspots, resulting in more than fifteen hundred positive 0:04:57.880 --> 0:05:02.160 infections and at least thirty nine fatalities. Carnival notes that 0:05:02.279 --> 0:05:06.280 other cruise companies have been impacted. Carnival's ships have become 0:05:06.320 --> 0:05:09.640 a floating testament to the viciousness of the new coronavirus 0:05:09.680 --> 0:05:13.880 and raised questions about corporate negligence and fleet safety. President 0:05:13.920 --> 0:05:17.599 and chief executive Officer Arnold Donald says his company's response 0:05:17.640 --> 0:05:21.640 was reasonable under the circumstances. This is a generational global event. 0:05:21.720 --> 0:05:26.520 It's unprecedented, he says. Nothing's perfect. Okay, they will say, wow, 0:05:26.600 --> 0:05:30.520 these things Carnival did great, these things twenty hindsight, they 0:05:30.560 --> 0:05:33.720 could have done better. Donald says that if his company 0:05:33.760 --> 0:05:36.320 failed to prepare for the pandemic, it failed in the 0:05:36.360 --> 0:05:39.360 same way that many national and local governments failed and 0:05:39.360 --> 0:05:42.679 should be judged accordingly. Each ship is a many city, 0:05:42.800 --> 0:05:46.760 he says, and Carnival's response shouldn't be condemned before analyzing 0:05:46.760 --> 0:05:49.120 what New York did to deal with the crisis, what 0:05:49.240 --> 0:05:52.800 the Vice President's task force did, what the Italians, Chinese, 0:05:52.800 --> 0:05:56.320 South Koreans and Japanese did. We're a small part of 0:05:56.360 --> 0:06:00.200 the real story. We're being pulled along by it. In 0:06:00.200 --> 0:06:02.960 the view of the c d C, however, Carnival helped 0:06:03.000 --> 0:06:07.240 fuel the crisis. Maybe that excuse flies after the Diamond Princess, 0:06:07.400 --> 0:06:10.320 or maybe after the Grand Princess, says Cindy Friedman, the 0:06:10.360 --> 0:06:13.480 experienced epidemiologist who leads the c d c's Cruise Ship 0:06:13.560 --> 0:06:16.120 task Force. I have a hard time believing they're just 0:06:16.160 --> 0:06:19.280 a victim of happenstance. While it would have been tough 0:06:19.320 --> 0:06:21.240 to get every one aboard the ships back to their 0:06:21.240 --> 0:06:24.880 home ports without infecting more people. Friedman says several of 0:06:24.880 --> 0:06:28.200 the plagued Carnival ships didn't even begin their voyages until 0:06:28.279 --> 0:06:30.479 well after the company knew it was risky to do so. 0:06:31.560 --> 0:06:34.680 She says its actions created a huge strain on the country. 0:06:35.320 --> 0:06:37.760 Nobody should be going on cruise ships during this pandemic, 0:06:38.000 --> 0:06:41.480 full stop, she says. Donald and his team say they 0:06:41.480 --> 0:06:44.839 are making every effort to protect and treat their remaining passengers. 0:06:45.279 --> 0:06:47.560 The company has attempted to dock its fleet until the 0:06:47.560 --> 0:06:51.279 pandemic subsides. All but about thirty two hundred passengers and 0:06:51.360 --> 0:06:55.320 crew are back on shore. Carnival's future is less clear. 0:06:55.839 --> 0:06:58.720 Australian police have launched a criminal probe into whether the 0:06:58.760 --> 0:07:02.920 company's Princess Cruise as subsidiary misled authorities about an outbreak 0:07:02.920 --> 0:07:05.480 aboard a ship docked in Sydney, and its Coast To 0:07:05.520 --> 0:07:09.320 Cruises subsidiary is facing multiple passenger lawsuits regarding its COVID 0:07:09.440 --> 0:07:13.960 nineteen response. Princess says it's cooperating with the investigation, while 0:07:14.040 --> 0:07:19.080 Costa says we are prepared to vigorously defend ourselves. Carnival 0:07:19.120 --> 0:07:21.920 canceled all its cruises in mid March, and its share 0:07:21.920 --> 0:07:26.240 prices down seventy so far this year. It's executives speak 0:07:26.280 --> 0:07:29.680 about their next moves in militaristic terms. They're setting up 0:07:29.800 --> 0:07:33.720 situation rooms, cutting through the fog of war, countering the 0:07:33.800 --> 0:07:37.920 virus on the front lines, says John Paget, Carnival's chief 0:07:37.920 --> 0:07:41.360 Experience and Innovation officer. The cruise space is as bad 0:07:41.400 --> 0:07:47.400 as it gets. It's armageddon. One side effect of an 0:07:47.480 --> 0:07:51.440 armageddon is to render the recent past faintly ridiculous. Last 0:07:51.440 --> 0:07:54.760 September in Brooklyn, Paget boarded another DOC ship to show 0:07:54.760 --> 0:07:58.760 off his company's new Medallion class badges. The electronic fobs 0:07:58.760 --> 0:08:01.560 were meant to double as abbin keys and credit cards, 0:08:01.800 --> 0:08:05.040 while also tracking passengers locations as they moved around the ship. 0:08:05.520 --> 0:08:08.000 The offering was part of a big digital overhaul to 0:08:08.040 --> 0:08:11.200 be introduced on at least six ships in twenty We're 0:08:11.200 --> 0:08:15.720 trying to eliminate guest friction, Paget said. Carnival's business had 0:08:15.720 --> 0:08:20.840 experienced a remarkable turnaround after Donald became CEO. In Over 0:08:20.880 --> 0:08:23.840 the next five years, the company's market value roughly doubled 0:08:23.920 --> 0:08:28.000 to fifty one billion dollars in twenty seventeen, Donald invested 0:08:28.040 --> 0:08:30.360 in building a one hundred and eighty thousand ton mega 0:08:30.400 --> 0:08:34.200 cruiser called the Mardi Gras, Carnival's largest ship ever, which 0:08:34.240 --> 0:08:36.720 cost about one billion dollars and is supposed to begin 0:08:36.800 --> 0:08:39.640 sailing in twenty twenty with the sea's first on board 0:08:39.800 --> 0:08:44.360 roller coaster. Before the COVID nineteen crisis began, the company's 0:08:44.400 --> 0:08:47.440 nine cruise brands employed one hundred and fifty thousand people. 0:08:48.200 --> 0:08:51.880 Carnival was founded in nineteen seventy two by Ted Harrison, 0:08:52.400 --> 0:08:55.319 an Israeli American who wanted to transform the image of 0:08:55.360 --> 0:08:58.959 the cruise industry from stuffy ultra luxury to a middle 0:08:59.000 --> 0:09:03.480 class splurge with a party atmosphere. Arison's first ship, also 0:09:03.600 --> 0:09:07.480 named Marti Gras, had only three hundred passengers and got 0:09:07.520 --> 0:09:10.760 stuck twenty minutes after leaving Miami on a soundbar, where 0:09:10.800 --> 0:09:13.960 it remained for twenty eight hours. In the nineteen eighties 0:09:13.960 --> 0:09:17.640 and nineties, Arison's son, Mickey, bought up a string of competitors, 0:09:17.800 --> 0:09:20.320 took the company public, and made his family one of 0:09:20.320 --> 0:09:23.199 the wealthiest in America. By the turn of the century, 0:09:23.320 --> 0:09:26.240 Carnival owned thirty six percent of the North American market. 0:09:26.360 --> 0:09:29.200 Mickey Arison bought the Miami Heat and became friendly with 0:09:29.240 --> 0:09:34.240 Donald Trump. Carnival sponsored the Apprentice more than once. After 0:09:34.280 --> 0:09:37.400 the Great Recession crippled the cruise business, Arison began to 0:09:37.400 --> 0:09:41.400 look like a less capable steward in Carnival's coast of 0:09:41.440 --> 0:09:44.720 Concordia crashed into a rock formation and sank in the 0:09:44.760 --> 0:09:49.160 calm waters off Tuscany, killing thirty two people, including a child, 0:09:49.360 --> 0:09:52.760 while the captain abandoned ship. The following year, a fire 0:09:52.800 --> 0:09:55.480 in the engine room of the Carnival Triumph, now better 0:09:55.559 --> 0:09:59.080 known as the Poop Cruise, left hundreds of guests stranded 0:09:59.120 --> 0:10:01.559 in the Gulf of Mexico without air conditioning or working 0:10:01.600 --> 0:10:05.280 toilets for several days. During both the Tuscany crash and 0:10:05.400 --> 0:10:09.880 the Poop Cruise, Arison was spotted at Heat Games. Arison 0:10:09.960 --> 0:10:12.640 was facing a shareholder revolt by the time he announced 0:10:12.640 --> 0:10:15.319 he was stepping down as CEO in favor of Donald, 0:10:15.679 --> 0:10:20.760 A board member and former Monsanto executive, Harrison remains Carnival's chairman. 0:10:21.240 --> 0:10:25.000 Donald positioned himself as a reformer, set on improving coordination 0:10:25.080 --> 0:10:28.400 between the company's various management teams, but he didn't manage 0:10:28.400 --> 0:10:31.120 to clean up its record in twenty seventeen, the U. 0:10:31.200 --> 0:10:34.760 S Department of Justice find Carnival's Princess line a record 0:10:34.800 --> 0:10:38.240 forty million dollars for dumping oil contaminated waste at sea 0:10:38.679 --> 0:10:42.880 and falsifying official discharge records to cover it up. Last June, 0:10:43.200 --> 0:10:46.200 Donald himself entered a guilty plea on behalf of Carnival 0:10:46.480 --> 0:10:49.480 for violating the terms of its settlement after authorities discovered 0:10:49.480 --> 0:10:52.080 that its ships kept on dumping even after the twenty 0:10:52.080 --> 0:10:56.640 seventeen ruling. We acknowledge the shortcomings, Donald told the Miami judge, 0:10:57.120 --> 0:11:00.520 I am here today to formulate a plan to fix them. 0:11:00.559 --> 0:11:03.200 He would head into twenty twenty committed, he said, to 0:11:03.360 --> 0:11:08.520 changing the company's tendency to cut corners on safety. At 0:11:08.520 --> 0:11:12.240 eleven twelve p m. Japan Standard time on February first, 0:11:12.600 --> 0:11:15.199 more than a month after the outbreak on the Grand Princess, 0:11:15.600 --> 0:11:18.360 the Diamond Princess was skimming around Asia on a multi 0:11:18.360 --> 0:11:22.800 weeak cruise. One of its sanitation vendors, Walllam Group emailed 0:11:22.840 --> 0:11:25.560 an alert to the vessel's chief administration officer and a 0:11:25.600 --> 0:11:29.560 guest service's inbox. A Walam representative said a passenger was 0:11:29.600 --> 0:11:33.280 being treated for COVID nineteen in Hong Kong would kindly 0:11:33.320 --> 0:11:36.800 inform the ship related parties and do the necessary disinfection. 0:11:36.920 --> 0:11:42.600 The alert read unfortunately and somewhat inexplicably. According to Roger Frizelle, 0:11:42.640 --> 0:11:47.400 Carnival's chief communications officer, nobody was monitoring those in boxes. 0:11:48.000 --> 0:11:50.320 He first says the messages hadn't been read for at 0:11:50.360 --> 0:11:54.480 least days, then later emails that actually unemployee had read 0:11:54.520 --> 0:11:58.800 them much sooner. In Carnival's latest version of the timeline, 0:11:58.960 --> 0:12:02.199 which it revised repeatedly during various interviews over the past 0:12:02.200 --> 0:12:05.839 several weeks. Nancy Chung, a Hong Kong based director for 0:12:05.880 --> 0:12:08.880 the Princess Line, learned of the positive test a few 0:12:08.880 --> 0:12:12.079 hours later after seeing a report from now News TV 0:12:12.240 --> 0:12:15.640 about a hospitalized coronavirus patient who was understood to have 0:12:15.679 --> 0:12:19.000 traveled to Hong Kong on a cruise. Chung texted and 0:12:19.080 --> 0:12:22.560 executive in California who requested she connect Hong Kong health 0:12:22.559 --> 0:12:26.360 officials with Tarling, the company's chief medical officer. According to 0:12:26.400 --> 0:12:29.800 screenshots of the messages viewed by Bloomberg business Week, the 0:12:29.840 --> 0:12:33.440 company says these messages show it acted promptly, but Carnival 0:12:33.480 --> 0:12:35.599 didn't tell passengers they might have been exposed to the 0:12:35.679 --> 0:12:39.520 virus until the evening of February third, about forty three 0:12:39.559 --> 0:12:43.200 hours after the initial alert from Wallam was sent. There 0:12:43.240 --> 0:12:47.320 are other inconsistencies that suggest Carnival wasn't entirely on the ball. 0:12:47.920 --> 0:12:50.520 The Hong Kong Health Department put out a press release 0:12:50.559 --> 0:12:54.120 announcing the COVID nineteen case late on February one, and 0:12:54.160 --> 0:12:57.199 at eleven thirty three a m. On February second, Tarling 0:12:57.240 --> 0:12:59.520 sent an email to Hong Kong health authorities with the 0:12:59.520 --> 0:13:04.800 subject line confirmed coronavirus case that included the passenger's name, age, 0:13:04.840 --> 0:13:08.920 and ward location at Princess Margaret Hospital. But Carnival says 0:13:08.960 --> 0:13:11.800 this was a mistake. The subject line should have had 0:13:12.040 --> 0:13:15.040 question mark question mark question mark because he was asking 0:13:15.080 --> 0:13:19.040 if it's confirmed, says for Zelle, the Carnival spokesman, adding 0:13:19.040 --> 0:13:22.560 that Tarling didn't get official confirmation until six pm on 0:13:22.600 --> 0:13:26.240 February two. Tarling says he didn't see the previous day's 0:13:26.240 --> 0:13:29.280 press release. A spokesman for the Hong Kong Health Department 0:13:29.320 --> 0:13:32.199 notes that in addition to the press release, it immediately 0:13:32.200 --> 0:13:35.520 informed the shipping agent in Hong Kong of the cruise concerned. 0:13:36.360 --> 0:13:40.320 Another twenty four hours elapsed before Captain Gennaro Arma informed 0:13:40.360 --> 0:13:43.200 passengers and crew on the Diamond Princess of the COVID 0:13:43.280 --> 0:13:46.960 nineteen case. In his announcement at six thirty three pm 0:13:47.040 --> 0:13:49.920 on February three, he tried to project calm as the 0:13:49.920 --> 0:13:53.760 ship cruised toward Yokohama, Japan. The guest hadn't reported feeling 0:13:53.840 --> 0:13:57.319 ill during his time on board, Armah said over the loudspeaker, 0:13:57.679 --> 0:14:01.880 but passengers should avoid close contact with anyone suffering respiratory illness, 0:14:02.160 --> 0:14:05.280 wash their hands for twenty seconds, and seek treatment from 0:14:05.320 --> 0:14:08.040 the ship's nurses if they had fever, chills, or a cough. 0:14:08.720 --> 0:14:11.160 Rest assured there will be no charge for this service. 0:14:11.200 --> 0:14:15.480 He said. Upon arrival in Yokohama that evening, Japanese health 0:14:15.480 --> 0:14:19.600 officials started medical screenings. Arma added, the situation is under 0:14:19.640 --> 0:14:22.840 control and therefore there are no reasons for concerns. Even 0:14:22.880 --> 0:14:27.080 after Carnival became aware of the potential coronavirus case, passenger 0:14:27.160 --> 0:14:30.560 say staff tried to keep the fund going. Guests continued 0:14:30.600 --> 0:14:34.160 eating and drinking at buffets and bars, hanging out in saunas, 0:14:34.200 --> 0:14:39.760 and attending shows, including an operatic performance called Bravo Carnival 0:14:39.880 --> 0:14:44.760 distributed itineraries known as Princess Patter, guiding guests to trivia 0:14:44.840 --> 0:14:48.440 contests and other group activities. On February third. They were 0:14:48.560 --> 0:14:52.000 encouraging us to mingle, says Gay Corter, who, after getting 0:14:52.000 --> 0:14:54.560 her temperature taken by a Japanese official the next day, 0:14:54.880 --> 0:14:57.320 went for a walk on deck and saw tables of 0:14:57.320 --> 0:15:00.720 as many as thirty people playing mah jong. A Carnival 0:15:00.720 --> 0:15:05.000 spokesman says the staff discontinued most scheduled activities on February fourth, 0:15:05.440 --> 0:15:09.000 Though Japanese officials didn't institute a ship wide quarantine requiring 0:15:09.000 --> 0:15:12.560 passengers to stay in their cabins until February five. The 0:15:12.640 --> 0:15:16.960 president of Carnival's Princess Cruz's Division, Jan Swartz, says the 0:15:16.960 --> 0:15:20.560 company was deferring to Japanese health officials. She says the 0:15:20.560 --> 0:15:24.600 crew followed government guidelines delivering the passenger's food and prescription 0:15:24.640 --> 0:15:28.560 refills as the quarantine at Yokohama's port wore on. Carnival 0:15:28.600 --> 0:15:30.920 c e o'donald says he was aware of the situation, 0:15:31.280 --> 0:15:34.160 but didn't personally take control of the response efforts until 0:15:34.160 --> 0:15:37.880 February five. We have a nice chain of command, He says, 0:15:38.160 --> 0:15:40.920 as it became a bigger issue, I'm dialing into the 0:15:40.920 --> 0:15:45.800 situation updates. It was an increasingly chaotic period for Carnival. 0:15:46.360 --> 0:15:49.240 Shortly before the Diamond Princess problem, there had been a 0:15:49.240 --> 0:15:52.280 coronavirus scare aboard one of its ships near Italy, and 0:15:52.360 --> 0:15:55.520 a second in mid February on another Carnival cruise in Asia. 0:15:56.080 --> 0:15:59.960 Carnival says these were false alarms. Countries around the world 0:16:00.040 --> 0:16:03.280 began refusing to allow the company's boats to dock, fearing 0:16:03.280 --> 0:16:06.440 they had spread the virus, creating novel challenges for Donald 0:16:06.480 --> 0:16:09.840 and his team. It wasn't like there were protocols and 0:16:09.880 --> 0:16:13.360 that this was established. You're at sea, you're moving people around, 0:16:13.680 --> 0:16:16.080 and the rules are changing as you go, he says. 0:16:16.840 --> 0:16:19.360 He adds that by early March, when the virus hit 0:16:19.400 --> 0:16:23.000 the Grand Princess, Carnival had systems in place to take 0:16:23.040 --> 0:16:26.400 better care of its guests. Some Grand Princess passengers had 0:16:26.400 --> 0:16:28.600 to fill out a questionnaire asking if they had recently 0:16:28.640 --> 0:16:31.440 been to China, though there were no questions about whether 0:16:31.480 --> 0:16:35.640 they had symptoms consistent with COVID nineteen. On March five, 0:16:35.760 --> 0:16:39.040 after the ship's crew canceled the ukulele concert and any 0:16:39.080 --> 0:16:42.600 further games of True or Move. The Grand Princess went 0:16:42.600 --> 0:16:45.640 into a holding pattern off the San Francisco coast while 0:16:45.640 --> 0:16:48.080 the White House and state and local officials figured out 0:16:48.160 --> 0:16:51.240 what to do. Passengers were stuck in their cabins for 0:16:51.280 --> 0:16:55.000 almost two weeks as helicopters delivered provisions and test kits. 0:16:55.880 --> 0:16:59.600 The Grand Princess pulled into port on March nine in Oakland, California, 0:17:00.040 --> 0:17:03.400 where the CDC mostly took over. Like those aboard the 0:17:03.440 --> 0:17:07.919 Diamond Princess, the passengers endured an additional fourteen day quarantine 0:17:07.960 --> 0:17:12.439 after disembarking before being allowed to travel home. Between the 0:17:12.440 --> 0:17:16.160 Diamond Princess and Grand Princess, eight hundred and fifty people 0:17:16.280 --> 0:17:20.920 tested positive for COVID nineteen and fourteen have died. More 0:17:20.960 --> 0:17:25.440 would follow from outbreaks on other ships. Asked why Carnival 0:17:25.440 --> 0:17:29.520 didn't act sooner to initiate stringent shipwide quarantines and why 0:17:29.560 --> 0:17:32.000 so many passengers reported being able to stroll about the 0:17:32.000 --> 0:17:36.159 ships following alerts of possibly deadly infections. Swartz says the 0:17:36.200 --> 0:17:39.760 company was following the direction of health authorities. It's very 0:17:39.840 --> 0:17:43.800 easy and Monday morning, you know, hindsight to say what's 0:17:43.840 --> 0:17:46.240 the view of what should have been occurring, She says, 0:17:46.680 --> 0:17:50.080 we did our best to take care of people. Carnival 0:17:50.119 --> 0:17:52.640 executives say they're proud of how they served the customers 0:17:52.640 --> 0:17:57.159 aboard these cruises. They refunded everyone's tickets and on board purchases, 0:17:57.560 --> 0:18:01.359 provided free internet access during the corn teens, and assisted 0:18:01.359 --> 0:18:05.440 with post cruise travel accommodations. Swartz, who notes she's had 0:18:05.520 --> 0:18:08.720 many tours of duty in crisis management during her twenty 0:18:08.760 --> 0:18:12.080 years at Carnival, says she expects the experience to make 0:18:12.119 --> 0:18:15.119 customers more likely to cruise with the company, not less. 0:18:15.840 --> 0:18:18.800 There are many loyal Princess guests who have told us 0:18:18.840 --> 0:18:21.479 that this is actually cemented Princess as their number one 0:18:21.560 --> 0:18:28.359 vacation choice, she says. During Bloomberg Business Week's March seven 0:18:28.480 --> 0:18:32.000 phone interview with Schwartz, reports surface that four more people 0:18:32.040 --> 0:18:34.920 had died and at least one thirty eight passengers were 0:18:34.960 --> 0:18:39.160 sick aboard another Carnival ship, the Zandam, part of its 0:18:39.160 --> 0:18:43.280 Holland America line. Over the following days, the ship lingered 0:18:43.320 --> 0:18:46.400 near the coast of Fort Lauderdale, waiting for government permission 0:18:46.440 --> 0:18:50.600 to dock at Port Everglades. Florida. Yadira Carza, who embarked 0:18:50.600 --> 0:18:53.600 on the Zandam for her honeymoon, says from the ship 0:18:53.640 --> 0:18:56.960 that she and her husband are terrified. The crew are 0:18:57.040 --> 0:18:59.960 sick and getting sicker. It's a matter of time before 0:19:00.080 --> 0:19:03.160 gets to us and we're infected, she says. For some 0:19:03.200 --> 0:19:05.480 people it will be the last trip of their lives. 0:19:06.000 --> 0:19:09.480 As of early April, Carnival still had passengers at sea, 0:19:09.760 --> 0:19:12.520 nearly a month after the CDC issued a March eighth 0:19:12.600 --> 0:19:17.480 public advisory to defer all cruise ship travel worldwide. Spokesperson 0:19:17.520 --> 0:19:20.679 for Zell says Carnival wasn't under any legal obligation to 0:19:20.680 --> 0:19:24.359 follow the CDC's advice. The advisory is not an edict, 0:19:24.480 --> 0:19:28.200 he says. Donald and Schwartz say there's nothing they could 0:19:28.240 --> 0:19:31.440 have done to halt further infections in February, when they 0:19:31.440 --> 0:19:33.879 say the world still didn't grasp how much the virus 0:19:33.920 --> 0:19:37.760 was spreading outside China, but the US declared a public 0:19:37.800 --> 0:19:41.400 health emergency and restricted travel to China on January thirty one, 0:19:42.080 --> 0:19:45.880 even as Carnival ships continued to sail around Asia. There 0:19:45.920 --> 0:19:50.119 were other early warnings. Paget, the Innovation chief, says that 0:19:50.160 --> 0:19:53.960 in January after he'd communicated with the manufacturer in Wuhan 0:19:54.119 --> 0:19:57.040 the origin of the pandemic about making batteries for the 0:19:57.080 --> 0:20:01.240 digital badge system. The leadership, including Arno Old Donald, all 0:20:01.320 --> 0:20:04.800 knew about the scale of the coronavirus outbreak. Paget says 0:20:04.800 --> 0:20:08.560 he became aware of the problem's magnitude on January. He 0:20:08.600 --> 0:20:11.080 remembers the exact date because it was the day before 0:20:11.160 --> 0:20:14.879 Kobe Bryant died. The biggest thing about that, it's a 0:20:14.960 --> 0:20:17.480 learning I don't think I'll ever forget, and we shared 0:20:17.520 --> 0:20:19.879 it with Arnold when we were talking, is that we 0:20:19.960 --> 0:20:23.359 actually had insight into the global situation much earlier than most. 0:20:23.560 --> 0:20:27.800 Paget says. Carnival canceled cruises set to embark from England 0:20:27.920 --> 0:20:30.959 Chinese ports, but these measures don't appear to have altered 0:20:30.960 --> 0:20:33.920 anything for ships making mid cruise stops around Hong Kong 0:20:34.359 --> 0:20:37.879 or other parts of Asia. Carnival executives also make the 0:20:37.960 --> 0:20:41.360 highly questionable assertion that cruise ships don't spread disease more 0:20:41.440 --> 0:20:44.439 easily than it would spread elsewhere. Nothing to do with 0:20:44.480 --> 0:20:48.439 cruise ships, Donald says. COVID nineteen spreads the same in 0:20:48.600 --> 0:20:52.080 an airport terminal, a subway station, a restaurant, a theater, 0:20:52.240 --> 0:20:56.560 a stadium. That's misleading, says Friedman from the CDC's Cruise 0:20:56.560 --> 0:21:00.240 Ship Task Force. Her team has seen coronavirus infection rates 0:21:00.240 --> 0:21:04.520 approaching on two of Carnival's ships, she says, much higher 0:21:04.560 --> 0:21:07.679 than the spread in a supermarket or subway. Part of 0:21:07.720 --> 0:21:11.000 the problem, she says, is that cruises are often populated 0:21:11.000 --> 0:21:13.560 with people at greater than average risk for the disease. 0:21:14.240 --> 0:21:17.080 More than two thirds of the Zendam's passengers are older 0:21:17.119 --> 0:21:20.840 than sixty five, She says, crew members sleep in bunk 0:21:20.880 --> 0:21:24.840 beds and usually share bathrooms. If these ships had stopped sailing, 0:21:25.240 --> 0:21:27.840 our large team could all be working on helping states 0:21:27.840 --> 0:21:31.280 and local public health authorities with their community outbreaks, she says. 0:21:32.080 --> 0:21:35.960 In apparent response to these discrepancies, Frizelle emails a BuzzFeed 0:21:36.080 --> 0:21:38.840 article reporting that multiple people had died from a COVID 0:21:38.920 --> 0:21:42.720 nineteen outbreak at a family burial service, his point being 0:21:42.760 --> 0:21:46.080 that virus is spread on Carnival ships just as they 0:21:46.119 --> 0:21:51.199 do at funerals. Since the company has failed three percent 0:21:51.280 --> 0:21:54.560 of c d C ship health inspections, three times worse 0:21:54.600 --> 0:21:59.280 than rival Royal Caribbean Cruises, which fails one percent of inspections. 0:21:59.480 --> 0:22:02.720 In an inter view, these statistics seem to surprise Donald. 0:22:03.240 --> 0:22:07.760 What we fail health inspections? He says when asked about them. 0:22:07.800 --> 0:22:10.760 After gathering his thoughts, he adds, I would say, though, 0:22:10.840 --> 0:22:13.639 that we do not have a record in any shape, 0:22:13.720 --> 0:22:16.800 form or fashion of being unhealthy of guests on our 0:22:16.840 --> 0:22:20.560 ships being more ill than another travel venues period, let 0:22:20.640 --> 0:22:25.280 alone other cruises. Why didn't Carnival simply dock every ship 0:22:25.320 --> 0:22:29.119 immediately after their initial crises? In effect, that's what people 0:22:29.119 --> 0:22:32.520 have been trying to do. But what happened was ports close, 0:22:32.640 --> 0:22:36.359 airports close, borders close, and even now we have tens 0:22:36.359 --> 0:22:38.359 of thousands of crew on our ships that we can't 0:22:38.400 --> 0:22:41.359 get home. Donald says, it's not because we want them 0:22:41.400 --> 0:22:44.280 all on the ships. It's because things closed down and 0:22:44.320 --> 0:22:49.920 we couldn't get them off. As a publication, Carnival had 0:22:50.000 --> 0:22:53.240 two of its one dred ships still at sea. Donald, 0:22:53.240 --> 0:22:56.240 who's working remotely from his home in Florida, says he's 0:22:56.320 --> 0:23:00.199 under constant stress from NonStop conference calls. The day go 0:23:00.280 --> 0:23:03.360 by so quickly, he says, sometimes it's hard to leave 0:23:03.400 --> 0:23:05.800 the bedroom because the call starts so early you haven't 0:23:05.800 --> 0:23:08.280 gotten dressed. Or showered yet, and then you're waiting for 0:23:08.320 --> 0:23:10.000 a break in the calls so you can do that. 0:23:10.440 --> 0:23:14.800 It's so crazy. Along with overseeing the fleet, he's been 0:23:14.840 --> 0:23:17.800 working the phones to raise money, including a fresh five 0:23:18.000 --> 0:23:20.679 d and seventy five million dollars in equity for a 0:23:20.720 --> 0:23:24.400 bargain eight dollars a share. He says these funds will 0:23:24.440 --> 0:23:27.639 give Carnival enough liquidity to survive and extended pause in 0:23:27.680 --> 0:23:31.880 its operations. Obviously we're hurting, he says. If we don't 0:23:31.880 --> 0:23:35.440 bring capital in, we wouldn't have a company. Although Arison 0:23:35.520 --> 0:23:38.640 has spoken with Trump during the crisis, Carnival and its 0:23:38.720 --> 0:23:42.040 rivals were left out of a federal bailout of US businesses, 0:23:42.480 --> 0:23:47.280 in part because they aren't legally speaking US businesses. Carnival 0:23:47.359 --> 0:23:50.640 paid seventy one million dollars in taxes on twenty point 0:23:50.720 --> 0:23:54.320