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EARLY START WITH JOHN BERMAN AND ZORAIDA SAMBOLIN

Tension Turns Deadly in Egypt; Subway Push Suspect In Court; Fears that Syria May Use Nerve Gas; Starbucks CEO Talks Fiscal Cliff

Aired December 6, 2012 - 06:00   ET

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


CHRISTINE ROMANS, CNN ANCHOR: Good morning and welcome to EARLY START this morning. I'm Christine Romans in for John Berman today.

ZORAIDA SAMBOLIN, CNN ANCHOR: And I'm Zoraida Sambolin. It is Thursday, December 6th. It is 6:00 a.m. in the East so let's get started here. Up first, we're keeping a close eye on the developing situation in Egypt. Protesters have turned to deadly violence now.

The presidential palace in Cairo is being guarded this morning by tanks and armored personnel carriers. The streets around the palace turned violent last night as supporters and opponents of President Mohamed Morsi hurled rocks and Molotov cocktails at each other.

At least five people were killed. Hundreds were injured. The pressure has been building as many Egyptians savouring a taste of democracy for the first time feel betrayed by what they believe is President Morsi's power grab.

Many now label him a dictator. Ian Lee joins us by phone from Cairo. What's happening right now? Do they have these clashes under control?

IAN LEE, CNN CORRESPONDENT (via telephone): Right now, there's kind of an uneasy calm in Cairo. We have the Republican Guard, and this is the elite's unit that protects the president. They have tanks and armored personnel carriers set up along with barbed wire and barricades around the presidential palace.

President Morsi does have thousands of supporters also around the presidential palace. We have seen some protesters, anti-Morsi protesters descend on the presidential palace, but we haven't seen the large numbers since yesterday.

But we are hearing that there are plans for marches to go to the presidential palace. So it's right now in the neighborhood, around it's very tense, as we're expecting, more protesters to descend on the palace.

SAMBOLIN: Ian, there are some demonstrators that are calling Morsi a dictator. But the draft constitution does contain term limits for the president. Do protesters think that Morsi is insincere in his efforts?

LEE: The reason a lot of them are calling him a dictator is because not only did he hold the presidential powers and legislative powers, but then he took away the judiciary's oversight of a constitutional process, writing the constitution, that was no more checks and balances.

A lot of people see this as a way that President Morsi and the supporters of the Muslim Brotherhood can consolidate power and also promote an agenda that they believe that will keep them in power.

But the president and the members of the Muslim Brotherhood say this is the only way to move the country forward and to get out a constitution quickly so the people can vote on it.

And they also say, if they don't like it, let it come down to a vote, to a referendum. Let the people decide if they like the constitution or not, and let that be the thing that determines how Egypt goes forward.

SAMBOLIN: All right, Ian Lee live in Cairo for us this morning, thank you.

ROMANS: Our other big story this morning, Syria increasing the fear that President Bashar Al Assad's embattled regime may be preparing to use chemical weapons against its opponents.

NBC News reports that Syria's military has loaded the component for the deadly nerve gas sarin into aerial bombs that could be dropped from fighter jets. CNN reported on Monday that Syrian forces started combining chemicals that could be use to make sarin gas for weapons.

SAMBOLIN: Now to the strange saga of John McAfee, the Internet security pioneer. He could face deportation to Belize as early as today. Guatemalan officials detained McAfee yesterday, accusing him of entering that country illegally.

He turned up in Guatemala on Tuesday after disappearing from his home in Belize. Police there want to question McAfee in connection with the murder of his neighbor. He says, he has maintained from the very beginning that he's innocent. But that he went into hiding because he feared persecution by police in Belize.

ROMANS: The suspect accused of shoving a man to his death in a New York City subway station, now facing a murder charge. The 30-year-old Naeem Davis was arraigned last night in a Manhattan courtroom.

Police say Davis who is homeless pushed 58-year-old Ki Su Khan off a platform and onto the tracks as a train was entering the station. They say Davis watched the train strike and kill Hahn before fleeing the scene. Witnesses helped police track him down.

SAMBOLIN: Three American men accused of plotting to blow up U.S. bases in Afghanistan have pleaded not guilty. Prosecutors say the three men planned for almost a year to fly to Afghanistan to join al Qaeda and the Taliban.

The California men were arrested last month, just days before investigators say they were to board a plane bound for Istanbul and then on Afghanistan. The FBI arrested their alleged ringleader in Afghanistan and brought him back to the United States. He has not yet faced a grand jury or been indicted.

ROMANS: Now to reefer madness in Washington State. Recreational marijuana use has been legal there for about six hours now. A new law allows adults to possess up to an ounce of pot, legally. Seattle's space needle has been the scene of an all-night pot party.

CNN's Miguel Marquez is live for us in Seattle. Good morning.

MIGUEL MARQUEZ, CNN CORRESPONDENT: Good morning, Zoraida. I think I have a contact high from covering that party and those parties took place across the state. People excited about this new law going into effect, but it has a lot further to go before it's fully implemented.

(BEGIN VIDEOTAPE)

MARQUEZ (voice-over): The moment recreational pot, anything less than an ounce, no longer illegal in Washington State.

UNIDENTIFIED MALE: It's amazing. I'm not a criminal anymore. I can't go to jail for small amounts of marijuana, you know? I'm free to be free.

MARQUEZ (on camera): Several dozen hard-core smokers showed is up here to the base of the space needle, the symbol of the city and of the state to light up at the stroke of midnight.

And while the new law does not allow smoking in public places, Seattle Police and police departments across the state are turning a blind eye tonight, allowing celebrations to light up. This is what you assume the stores will look like or something along these lines?

UNIDENTIFIED MALE: Yes, so our stores are going to have the feel of a fine cigar shop.

MARQUEZ (voice-over): Jaymon Shively was a high-profile executive at Microsoft, now preparing to open as many as two dozen high-end marijuana shops in Washington and Colorado. Yesterday he'd be called a drug dealer, today, an entrepreneur.

UNIDENTIFIED MALE: Our target market is actually baby boomers. So these are folks who maybe tried it in college a couple of times, maybe they didn't inhale, but now it's actually safe to inhale.

MARQUEZ: He's already working on packaging and attractive displays for future clients. The State Liquor Control Board has a year to regulate and license the growing, processing, and retailing of marijuana here, all of it taxable at a very high 25 percent.

UNIDENTIFIED FEMALE: We are looking at the potential of bringing in more than $500 million each year in new tax revenue.

MARQUEZ: The big question still what will the federal government do? Pot still illegal federally. Today, a legal took of revolution burning here and soon Colorado.

(END VIDEOTAPE) MARQUEZ: Now, the only thing the federal government has said at this point is to remind both Washington State and Colorado, where this becomes legal in January, by January 5th, is that pot is still illegal federally and they are -- they only say it's in the review process and they're not sure how they're going to treat it.

Here in Washington State, it's envisioned that the way that this will eventually work is like hard alcohol, essentially. You won't be able to smoke pot and drive, you'll have to use it in your home and not in public, and you'll have to be 21 and over in order to get access to it -- Christine.

ROMANS: So for today, Miguel, you can possess up to one ounce of pot, but can you buy it legally?

MARQUEZ: You cannot buy it legally today. That's one of the odd things about this program. You won't have the legal growers, processors, and retailers for another year at this point. So at this point, you still have to go to the black market to purchase pot in Washington State.

ROMANS: Yes, and the black market, the distribution, the sale and distribution is still, it's still an illegal -- it's still not a legal enterprise.

MARQUEZ: Correct.

ROMANS: And enough big employers in Washington State, Boeing and Cosco, they've banned their employees, Miguel, from smoking pot. Will this new law change anything? Can workers still get fired for testing positive?

MARQUEZ: Yes, no. The simple answer is no. If your employer says you can't smoke pot and if you get tested and are positive, this doesn't change that. And there are rules reminding students it is not legal to have pot and smoke pot on campus -- Christine.

ROMANS: And the DUI law, they'll have to adjust that a little bit. Even though it's legal to possess marijuana, it is not legal to drive under the influence.

MARQUEZ: Yes, that's one of the really contentious things for a lot of pot smokers here is the dui law will be updated to include marijuana usage. So it will measure -- blood tests will measure THC in the blood. If it's over a certain amount, your license goes, and just like if you were drinking and driving, you get the same effect -- Christine.

ROMANS: All right, Miguel Marquez, thanks, Miguel.

MARQUEZ: You got it.

SAMBOLIN: Breaking news in just minutes ago. The Duchess of Cambridge has been released from the hospital. She was admitted earlier this week with acute morning sickness. Katherine along with Prince William have announced that they are expecting their first child. There are the pictures for you.

She looks well, right, carrying a bouquet of flowers there. They got well wishes from all over the world. I don't remember how many weeks pregnant she is, but I know it's less than 12 weeks.

ROMANS: She's not yet 12 weeks pregnant. And she had not just morning sickness, but what doctors called morning sickness on steroids, where you're sick all the time and had to be hospitalized for that.

SAMBOLIN: There's been a lot of speculation about what does that mean, the fact that she had that extreme morning sickness, a lot of times you have multiple pregnancies that way.

ROMANS: A higher chance of multiple pregnancies -- or multiple --

SAMBOLIN: I'm sorry.

ROMANS: One pregnancy, but two babies, multiple births.

SAMBOLIN: Multiples.

ROMANS: There you go. OK, switching gears here, because we're also following an already dangerous and intense situation, Syria may be taking a deadlier turn. Reports this morning that the country's leader may be preparing the to unleash chemical weapons on his own people.

We're live from the region, a very dangerous situation developing there next.

(COMMERCIAL BREAK)

SAMBOLIN: There are new concerns this morning about the deteriorating situation in Syria, specifically the increasing fear that Bashar Al- Assad may resort to using chemical weapons against his opponents.

NBC News reports that Syria's military has loaded the component chemicals for the deadly nerve gas sarin into aerial bombs that could be dropped from fighter jets.

CNN reported on Monday that Syrian forces started combing chemicals that could be used to make sarin gas for weapons. CNN's Mohammed Jamjoom is in Beirut with more. What is the very latest here?

MOHAMMED JAMJOOM, CNN INTERNATIONAL CORRESPONDENT: Well, Zoraida, combined with this NBC News report from last night and what CNN reported on Monday, there are increasing fears that the Bashar Al Assad regime in Syria could possibly resort to using chemical weapons that they possibly have started mixing their chemical weapons.

This has been a nightmare scenario for some time. We should add however that even today Syrian officials have reiterated their stance that they've been saying for quite some time. That they will not use chemical weapons against the population of Syria, and that any type of military intervention by Western powers in Syria would be catastrophic, not just for the region, but for the entire world. Taken together, though, these are very worrying signs.

We know that later today, U.S. Secretary of State Hillary Clinton is going to be meeting with her Russian counterpart, Sergey Lavrov, and the U.N./Arab League joint peace envoy to Syria, Lakhdar Brahimi. This is a meeting that's going to take place in Dublin later today. This is an effort to try to get the peace plan for Syria back on track, a U.N. effort that's stalled for so many months now. There's not a lot of hope it will get back on track anytime soon, but it's coming a week ahead of a meeting that's going to be in Marrakech, of Friends of Syria.

A lot of international powers and a lot of pressure being put on Syria to try to comply with some sort of peace plan so that this nightmare scenario doesn't come to any sort of fruition -- Zoraida.

SAMBOLIN: All right. Mohammed, we're talking about a deadly nerve gas, it is sarin. Could you tell us what kind of damage could this do to the people there?

JAMJOOM: It's well known that sarin and the use of sarin is a nightmare scenario. The use of it could kill a huge amount of people in a very short amount of time.

Now, last night, a former CIA officer, Robert Baer, was speaking to Anderson Cooper. He described what the use of sarin could do. Here's more of what he had to say.

(BEGIN VIDEO CLIP)

ROBERT BAER, FORMER CIA OFFICER: One round and the dispersion on that could be -- depends on the wind -- but you could take out, let's say a city like Homs, you could take out a third of the city in the first couple of hours.

Anderson, this is a highly toxic liquid. It's a persistent agent. It's absolutely completely deadly.

(END VIDEO CLIP)

JAMJOOM: Now, we've heard repeatedly from U.S. administration officials, U.S. President Barack Obama, U.S. Secretary of State Hillary Clinton that the use of chemical weapons in Syria was a red line for which Syria and the Bashar al Assad regime would face severe consequences if they ever did cross that red line and utilize chemical weapons against the people of Syria -- Zoraida.

SAMBOLIN: Mohammed, we have no idea what those severe consequences would be, right?

JAMJOOM: That's right, we don't. You know, people speculate that this would mean some type of military intervention, but we also know that a lot of world powers have not wanted to intervene militarily in Syria.

SAMBOLIN: Yes. JAMJOOM: That they've wanted what's going on in Syria to happen within Syria. But the fears are if chemical weapons are utilized -- and again, the Syrian regime has said on many occasions, they are not going to use chemical weapons against their population -- that that would mean that there would be some type of military intervention, although it's unknown what scope that type of military intervention might take -- Zoraida.

SAMBOLIN: All right. Mohammed Jamjoom live in Beirut for us -- thank you very much.

Seventeen minutes past the hour here. A sobering cup of Joe from the Starbucks CEO. His dire warning about leaping off that fiscal cliff is next.

You're watching EARLY START.

(COMMERCIAL BREAK)

ROMANS: Good morning, again. Minding your business, 21 minutes past the hour.

Stock futures a little bit higher so far this morning. Focus, though, still on Washington, fiscal cliff negotiations, the world. You know, stocks have held up pretty well despite all this talk, but they really want Washington to get a deal done.

We're also going to get an update on the health of the labor market when the weekly jobs number comes out a little bit later this morning.

Of course, the big jobs number is tomorrow. So, we're going to get --

SAMBOLIN: I know you're very excited.

ROMANS: I'm excited to see what kind of impact -- not excited, but I'm looking to see what kind of impact Sandy had on those numbers and maybe fiscal cliff holding some employers back tomorrow. So, we'll know for sure tomorrow.

SAMBOLIN: So bad news?

ROMANS: We'll see.

SAMBOLIN: So, by now, we all know the siren mogul, right?

ROMANS: Many of us go grab a coffee there this morning. You know where it is, Starbucks.

But the CEO, Howard Schultz -- some sobering advice to offer on the looming fiscal cliff. The consequences will be worse than last area's debt ceiling fight, that's when the U.S. credit rating was downgraded for the first time ever. His message to lawmakers: now is not the time to play politics. You've got to do the right thing for the American people.

(BEGIN VIDEO CLIP) HOWARD SCHULTZ, CEO, STARBUCKS: I think if people would get in the room and leave their ego behind and not be so skewed towards the party, but be so sensitive to the lens of the American people, we will have an agreement.

(END VIDEO CLIP)

ROMANS: Poppy Harlow joins us now with more of her conversation with Howard Schultz.

Much of the focus has been about, you know, what's the best thing to do for this country, but it's a globe -- he says the whole world is watching.

POPPY HARLOW, CNN BUSINESS CORRESPONDENT: Yes, that it has massive consequences for the entire world. But, you know, you want to ask someone like Howard Schultz who runs a big global company like Starbucks, how do you create jobs? Because this is a guy who's been pretty critical of the government saying, look, the U.S. government hasn't done enough to create jobs.

So, we wanted to know specifically what should be done, what policy measures should be taken. Here's his perspective.

(BEGIN VIDEO CLIP)

SCHULTZ: There is such a large sum of money, sitting on the balance sheet of public companies overseas. Some people have said $2 trillion to $3 trillion. I don't know what the exact number is. But if we repatriated that money at a lower tax rate, people would bring the money back.

But I would tie the repatriation and the lower tax rate to a mandate of having to create jobs or invest in manufacturing capital equipment that would bring our manufacturing base back or begin to.

(END VIDEO CLIP)

HARLOW: So what would make this tax holiday different than in 2004, when arguably it didn't necessarily create so many jobs, like corporations said it would. That it would be tied to the mandate of investing and/or hiring.

So to create jobs. You know, this coming from a man who announced yesterday that his company, Starbucks, will open 3,000 new stores in the next five years, 1,500 of them here in the United States.

And I asked him, you know, why are you so optimistic when you're so worried about the fiscal cliff, what's happening in Washington, and he thinks that the company can support those jobs here in the United States, despite a downturn if we do have one.

SAMBOLIN: That's kind of a different mind-set, right? Because all we keep on hearing is how the fiscal cliff is going to adversely affect the creation of jobs.

HARLOW: And he thinks it will, but this is a long-term game plan, five years out.

SAMBOLIN: OK.

HARLOW: That that's important here.

But, you know, they're expanding hugely in India. They just opened three weeks ago in India. And in China, it's going to be the second biggest market for Starbucks by 2014. They're going to have 1,500 stores in 70 cities in China in the next three years.

ROMANS: And let's be clear about the fiscal cliff. I mean, the near- term impact is bad, right?

HARLOW: Yes.

ROMANS: A lot of people think it would be a recession -- but lasting long-term impact, it would lower deficits, you know, and would cut into -- so --

(CROSSTALK)

HARLOW: Dramatically.

ROMANS: Right. So this isn't the way to go about it. You want to scalp a hatchet, as I keep saying. But, you know, talking about -- companies are trying to make long-term plans, even though near term they're very concerned about what's going on.

HARLOW: Yes.

ROMANS: Thanks, Poppy.

HARLOW: Sure.

ROMANS: All right. Apple stock dropped more than 6 percent yesterday. Did you watch that? Shares down a little bit in premarket trading this morning.

No create news pushing the stock down. But there are a few factors that traders suspect drove the selling. Today, there's another hearing in the patent case with Samsung in California and a research report generated buzz that Apple's tablet competitors could eat into its market share. Apple shares were up 33 percent so far this year, right?

So if somebody's taking some profits, they've been doing it recently. They're down 24 percent from their all-time high a few weeks ago.

SAMBOLIN: All right. Twenty-five minutes past the hour.

Sorority under fire for throwing a Mexican-themed party, exploding with offensive stereotypes after this picture is posted online. It is only adding to the problems for one university that cannot stay out of the headlines.

ROMANS: Oh, ladies. (COMMERCIAL BREAK)

SAMBOLIN: Rage right now in Egypt. Violent crashes right outside the presidential palace. Thousands fearing they might lose the freedom they won in the Arab Spring.

ROMANS: First pot, now same-sex marriage. Washington state legalized both while you were sleeping last night. The details, coming up.

SAMBOLIN: And a man in Wisconsin is ordered not to have anymore children until l he can afford them. You will never believe how many kids he's had by how many different women. We'll have that story for you, coming up.

Good morning to you. Welcome to EARLY START. I'm Zoraida Sambolin.