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EARLY START WITH JOHN BERMAN AND ZORAIDA SAMBOLIN

East Coast On Alert; U.S. Intelligence Agencies Mining Data; White House Defends Surveillance Program; George Zimmerman Hearing; Obama Begins Two-Day Summit with Chinese Leaders; Monthly Jobs Report Due Today

Aired June 7, 2013 - 06:00   ET

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


JOHN BERMAN, CNN ANCHOR: -- the prosecution of hiding evidence. What they say the jury needs to know about Trayvon Martin.

CHRISTINE ROMANS, CNN ANCHOR: Good morning. Welcome to EARLY START. I'm Christine Romans.

BERMAN: I'm John Berman. It is --

ROMANS: Friday.

BERMAN: Friday, June 7th, 6:00 a.m. on the east.

ROMANS: If you live on the east coast, prepare to keep getting wet. Tropical Storm Andrea is the kind of rainmaker the east coast hasn't seen since Hurricane Sandy. In other words, you might want to rethink your weekend plans. Tropical Storm Andrea has already walloped Florida, seriously injuring one woman.

It made its way through Georgia overnight. Tonight, it's expected to churn up the eastern sea board, bringing with it heavy rain, flooding and a possibility of isolated tornadoes. Nick Valencia is on Wrightsville Beach, North Carolina. Nick, what are the conditions like there now?

NICK VALENCIA, CNN CORRESPONDENT: Hi, Christine. Yes, the water is really starting to come up a few feet since the last hour we spoke. The winds are also steadily increasing. Tropical Storm Andrea has already caused a mess in Florida as you know and now it's moving its way towards North Carolina.

(BEGIN VIDEOTAPE)

VALENCIA (voice-over): Rain, rain and more rain. Fast-moving Tropical Storm Andrea is making her presence known up and down the eastern seaboard. The first storm of the hurricane season will dump rain through the weekend in every state from Florida to Maine, parts of the northeast seeing rain totals that they haven't seen since Superstorm Sandy last October. In roadways all across the south, downed trees and closed streets, making it challenging to get around.

UNIDENTIFIED FEMALE: It's pretty bad and the flooding around here is getting worse and worse. VALENCIA: In Florida, Andrea spawned multiple tornadoes, one twister near Palm Beach flipping a 28-foot boat, blowing cars off of driveways and snapping trees in half.

UNIDENTIFIED MALE: I didn't hear it coming.

VALENCIA: Another reported tornado near Fernandina Beach, Florida, tearing apart this roof.

UNIDENTIFIED FEMALE: As soon as I puts the phone down, a huge gush of wind and I looked out the window and it was literally like it was coming off the ocean and I got so frightened I screamed.

VALENCIA: The sunshine state pummeled with rain for two days as the flood threat now spreads up the east coast. Forecasters predict some areas could see as much as six inches of rain. And as you see in this picture taken in Florida after Andrea, brighter days will come after this long, wet weekend.

(END VIDEOTAPE)

VALENCIA: Now there have been no evacuations ordered for this beach so far. Some residents have gotten out ahead of the wet weather while other residents, Christine, say they're going to ride it on out.

ROMANS: All right, stay safe and try to stay dry. Nick Valencia for us in North Carolina.

BERMAN: So where is that storm headed now when it's done with Nick? Let's ask meteorologist Alexandra Steele tracking the storm for us in the Weather Center. Hi, Alexandra.

ALEXANDRA STEELE, AMS METEOROLOGIST: All right, John, let me just tell you on Sunday, New York to Washington, is partly sunny skies and 81 degrees. So this is a fast mover. It is just rocketing the northeast now at 28 miles per hour, its center of circulation, northeast of Savannah, Georgia, by about 30 miles.

You can barely even see here on the satellite, but two threats with this. One will be the heavy rain thus the flood threat and second are the tornadoes. We do have a tornado warning already right now. I'll show you where that is. Here is the heaviest rain, maximum sustained winds at 45 miles per hour, but predominantly, they are off the coast here where the heaviest rain bands are.

So that's where the strongest winds are really right off the coast. Here's our tornado warning. It's an eastern North Carolina until 6:30 this morning. So the threats for tornadoes are there through today and through tonight. What we've seen rain wise, you can see, 3 to 5 inches, 4 to 6 in Southeast Georgia that threat, the heaviest rain in the next day moving into the northeast, 2 to 4 inches.

You can see from New York to Boston, and then it all moves out of here by the time we head towards Sunday. We'll have more on where the biggest threats are right along the coast coming up in just a bit.

ROMANS: I guess the fact that it's going fast is good. That means it's going to rush through and not going to linger too long.

BERMAN: Save a little bit of the weekend.

ROMANS: Alexandra Steele, thanks.

OK, first it was phone records and now data mining, a raging controversy unfolding this morning on Capitol Hill with new reports that United States intelligence agencies are tapping into the central servers of the country's biggest internet firms and this has been happening for years. That makes things like your Gmail messages and Facebook posts. That means they may have been mined.

According to "The Washington Post" and "The Guardian" newspaper, nine internet giants are involved in the government intelligence operation known as prism. The program reportedly began in 2007, but has expanded under the Obama administration.

Barbara Starr is live at the Pentagon this morning to give us a sense of what we know about the extent of this and what the administration is saying. Good morning.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Good morning, Christine. Well, you know, the government likes to use that phrase mining your data, but for most Americans there's really only one question, is the government listening to your phone calls and watching you on the internet.

(BEGIN VIDEOTAPE)

STARR (voice-over): A potentially explosive disclosure about how easily the government can collect information online. "The Washington Post" and the British newspaper "The Guardian" are reporting that the National Security Agency, the NSA, and the FBI, are tapping directly into the servers of nine leading internet companies, including Microsoft, Yahoo! Google, Facebook, AOL, Skype, YouTube, and Apple. That's according to a top secret NSA presentation, intercepting data like video, photographs, and e-mails, flowing online.

GLENN GREENWALD, REPORTER, "THE GUARDIAN": What this program enables the National Security Agency to do is to reach directly into the servers of the largest internet companies in the world, things that virtually every human being in the western world now uses, to communicate with one another.

STARR: The program appears to be intended to grab non-U.S. intercepts, many of which flow through the robust U.S. internet. One slide in the NSA presentation explains, your targets communications could easily be flowing into and through the U.S. CNN has not confirmed the authenticity of the documents. Several of the companies reportedly cooperating with the government issued denials of involvement.

This follows the stunning news that a secret federal court order directed Verizon to hand over phone records of millions of Americans. Former intelligence officials and privacy advocates say it's reasonable to presume other telephone companies got similar orders. STEVE AFTERGOOD, FEDERATION OF AMERICAN SCIENTISTS, SECRECY AND INTELLIGENCE: If this is an open-ended and indiscriminate collection process as it seems to be and then logically one would expect it to be much bigger than Verizon business.

STARR: And it all leaves the administration needing to explain this exchange in March.

SENATOR RON WYDEN (D), OREGON: Does the NSA collect any type of data at all on millions or hundreds of millions of Americans?

JAMES R. CLAPPER, RETIRED LIEUTENANT GENERAL: No, sir.

WYDEN: It does not?

CLAPPER: Not willingly.

STARR: That Verizon program, lawmakers say having access to that data helped law enforcement stopped terrorist plots from being carried out.

(END VIDEOTAPE)

STARR: Now, James Clapper, you just saw him at the end there, the director of national intelligence overnight, issued a statement very unusual, going public and clarifying in his view the program. I want to read some of it to you.

Clapper says, quote, "The unauthorized disclosure of information about this important and entirely legal program is reprehensible and risks important protections for the security of Americans. The program cannot be used to intentionally target any U.S. citizen or other U.S. person or anyone located within the United States." So a defense from the intelligence community, a lot of questions from Americans and from Congress.

ROMANS: You know, Barbara, so the program reportedly aimed at targeting non-Americans only, with the focus on suspected spies and terrorists. Is it likely some American citizens have also had their data pulled?

STARR: Well, I think you have to assume that they do because, I mean, what we all acknowledge is the internet, telephone networks, they really do not have anything to do with international boundaries, do they? It's a global entity. So the chances are, absolutely, yes. What the government is saying, they don't intentionally do that and that they are not spying on American citizens. They are looking for information about terrorism. That's their defense.

ROMANS: I mean, is there any evidence that the program has stopped any terrorist or other criminal activity? Does it work for them?

STARR: Well, I mean members of Congress have come out and said that it has stopped terrorist plots and, of course, they're not telling us which ones, they're not going public with any of that. Not aimed at criminal activity. Very much they say aimed at terrorist and they say that it is working. ROMANS: All right, Barbara Starr at the Pentagon. Thank you, Barbara.

BERMAN: So this morning the White House is dealing with backlash, the political backlash over the NSA's secret programs. The Obama administration says it is key to fighting terrorism. You heard Barbara talk about that. Reaction from Congress is both strong, but very much mixed.

CNN's Dan Lothian is tracking all the politics of this. He is live at the White House. Good morning, Dan.

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: Good morning, John. Well, you know, the White House has really been trying to move beyond a lot of these controversies, to focus on the economy, to push the president's second term agenda. It seems every day there are new revelations and while some here in Washington think that all of this is needed in order to protect Americans, others believe that this kind of information gathering is going a little too far.

(BEGIN VIDEOTAPE)

LOTHIAN (voice-over): This morning, President Obama is waking up in California, as a political firestorm over the government's collection of phone and internet data intensifies.

SENATOR BERNIE SANDERS (I), VERMONT: The bottom line is that the United States government now has phone records and other records of tens and tens and tens of millions of Americans who have nothing, absolutely nothing, to do with terrorism.

LOTHIAN: The political fallout after news that the NSA was collecting American's phone records from Verizon was quick, public outrage over privacy rights already taking form online.

UNIDENTIFIED MALE: Can you hear me now?

UNIDENTIFIED MALE: Yes, we can.

UNIDENTIFIED MALE: Can you hear me now.

UNIDENTIFIED MALE: Yes, we can.

LOTHIAN: A singing editorial in "The New York Times" proclaims President Obama's drag net and says the administration has now lost all credibility and the letter to Attorney General Eric Holder from the author of the patriot act Representative Jim Sensebrenner who writes he's extremely disturbed by what appears to be an overbroad interpretation of the act. Even the president's liberal base piled on. "The Huffington Post"" ran a photo on its cover page showing Obama morphing into George W. Bush, but the program has its defenders.

REP. MIKE ROGERS (R), INTELLIGENCE COMMITTEE CHAIRMAN: This program was used to stop a program or excuse me to stop a terrorist attack in the United States. We know that. LOTHIAN: The White House says these types of orders include data, not phone calls, and have been a critical tool in protecting the nation from terror threats. But some lawmakers want more answers and Attorney General Holder, already under pressure for snooping on reporters, is on the hot seat again.

SEN. MARK KIRK (R), ILLINOIS: Could you assure to us that no phones inside the capitol were monitored, members of Congress?

ERIC HOLDER, U.S. ATTORNEY GENERAL: With all due respect, Senator, I don't think this is an appropriate setting for me to discuss that issue.

(END VIDEOTAPE)

LOTHIAN: So some senators have asked for a full briefing from the attorney general and also from other agencies, the NSA. They want to find out just how far these programs have gone and why -- John.

BERMAN: Range of opinions in Washington, Dan, over this simply fascinating, some Republicans for it, some against it and some Democrats for it, some against it. Everyone seems to have a different opinion. Dan Lothian at the White House this morning.

ROMANS: You know, what I learned this week? I learned this week that the government does not have the ability to compel a company to recall cars, but it does have the ability to mine all of this data and you might not know about it. Interesting.

O.K., new this morning at least three people are dead after a medical helicopter crashed into an elementary school parking lot in Kentucky. It happened southeast of Lexington. Officials say the chopper was on its way back to base after transporting a patient. Only the crew was on board. No word on a cause.

BERMAN: Arlington National Cemetery will be the final resting place for Frank Lautenberg, the late New Jersey senator will be buried there in a ceremony later this morning. Meantime, Governor Chris Christie moving quickly to fill Lautenberg's seat and appointed the state's Republican Attorney General Jeff Chiesa to hold the seat until a special election in October.

ROMANS: "The New York Post" is now facing a defamation lawsuit from the so-called bag men. Two Massachusetts men who say the paper falsely portrayed them as suspects in the Boston marathon bombings. This front page ran three days after the attack and shows Yasimi Zaimi, he is the one in black, and Salah Barhoum in blue, standing near the marathon course.

The headline read "bag men" because they were carrying knapsacks. The pair had nothing to do with the attacks. They say the headline opened them up to scorn, hatred and contempt. "The Post" stands by its story.

BERMAN: All right, so if you had to go to bed a little bit early, you missed it. There was a big upset in game one of the NBA finals, the Spurs and Tony Parker playing some fantastic basketball. This is Tony Parker as the clock was running out at the end of the game with some crazy circus moves.

Look at them keep the dribble, get the shot off and it counts. They had to look at it again and again and again to make sure it got off before the buzzer. The light goes on in the backboard. He did get the shot off. The Spurs won 92-88 on Miami's home court. There again, a little bit of an upset there.

The Spurs have by the way won every game one in the finals they've been in. They got four NBA titles so far and going for their fifth. So they're off to a good start. Game two this weekend in Miami.

ROMANS: All right, coming up, back in court. Attorneys fight it out over evidence ahead of the George Zimmerman trial. We're going to have the latest on that.

BERMAN: And visit from a friend, co-anchor Zoraida Sambolin will join us to talk about how she's doing after her surgery. We cannot wait to talk to her this morning.

(COMMERCIAL BREAK)

BERMAN: Welcome back, everyone.

Pretrial hearings continue today in Florida for the man who shot Trayvon Martin. George Zimmerman's defense team has been sparring with prosecutors about potential pieces of evidence for his upcoming murder trial set to get under way next week.

As CNN's Martin Savidge reports, things got a little bit heated inside the Florida courtroom.

(BEGIN VIDEOTAPE)

MARTIN SAVIDGE, CNN CORRESPONDENT (voice-over): The exchanges were heated and testy.

BERNIE DE LA RIONDA, PROSECUTOR: Do you have a problem remembering things? Or do you have a bad recollection of things?

WESLEY WHITE, WITNESS: After 33 years, you learn to sort of box off things that need to be remembered and others that sort of you can let go.

DE LA RIONDA: Unpleasant things you kind of want to put to the side.

WHITE: No, not necessarily unpleasant things, sir.

DE LA RIONDA: OK.

WHITE: I remember you.

SAVIDGE: Emotions ran even higher when Zimmerman's defense team accused the prosecutor of deliberately withholding key evidence from Trayvon Martin's cell phone. DON WEST, ZIMMERMAN DEFENSE ATTORNEY: We caught you hiding the information and confronted you about it and you never gave it to us.

SAVIDGE: At issue, images in the teen's phone of a handgun and marijuana and texts seemingly about a gun deal.

Prosecutor Bernie de la Rionda says the defense was given everything.

But a tech expert from the state attorney's own office testified he, too, was concerned not all of the phone's contents had been handed over, and now fears speaking out will cost him his job.

MARK O'MARA, ZIMMERMAN DEFENSE ATTORNEY: Do you think that that potential is worth the risk you took in disclosing it?

BEN KRUIDBOS, WITNESS: Yes, I do.

O'MARA: Why is that?

KRUIDBOS: I think all of the information being shared is important in the process to make sure that it's a fair trial.

SAVIDGE: Judge Debra Nelson postponed any decision on the matter until after trial.

Next, came the debate over the infamous 911 call that captured the screams and gunshot the night Martin died.

UNIDENTIFIED FEMALE: Just some screaming outside.

SAVIDGE: The defense wants to block one expert's analysis that Martin is the one pleading for help and begging for his life. A senior audio engineer with the FBI testified the recordings quality is too poor to make an interpretation and warns against any attempt to do so.

HIROTAKA NAKASONE, FBI AUDIO ENGINEER: From my experience, what's going to happen to the output of the ultimate approach will be -- number comes out. But that number will be completely meaningless, confusing. It might mislead in the worst case.

SAVIDGE: Just what the jury will hear about that call is considered by many to be one of the most crucial questions in this already highly contentious case.

Martin Savidge, CNN.

(END VIDEOTAPE)

ROMANS: President Obama begins a two-day summit today with China's leader. Mr. Obama arrived in California last night and will meet this afternoon with President Xi Jinping in Rancho Mirage near Palm Springs, at the estate of the late publishing magnate Walter Annenberg. It will be an informal meeting, designed so the two leaders can get to know each other.

BERMAN: The deadline is today for the State Department to turn over e-mails related to the deadly attack in Benghazi, Libya. House committee chairman Darrell Issa is investigating the talking points put out by the administration after the attack. He is demanding that all Benghazi-related documents and e-mails from 10 current and former State Department officials. That includes from Victoria Nuland, who was the State Department's spokesperson at the time.

ROMANS: Coming up, who was hiring in May? We're watching the markets ahead of the job's report. We're going to and tell you whether your prospects for landing a job are getting any better.

BERMAN: Big time.

(COMMERCIAL BREAK)

ROMANS: Good morning. Welcome back to EARLY START.

Minding your business this morning. The countdown to the biggest economic report of all, the monthly jobs report. It's about two hours away.

Wall Street expecting 158,000 net new jobs added in May. The unemployment rate likely held steady at 7.5 percent.

BERMAN: The mother of all economic reports.

ROMANS: And we'll know for sure in two hours what the number is and it could influence stocks.

The jobless rate, that jobless rate has been falling steadily since hitting 10 percent in 2009, but it still has a ways to go. Most states have unemployment rates below the national average. You could see here in green. Those are the states that have an unemployment rate that's less than the national average.

So, their job markets are a little better than the rest of the country. But analysts are worried. They're looking at the employment rate a little known number that shows how many Americans are working. It's at 58 percent, the lowest since the 1980s. It hasn't budged in three years.

Fed Chief Ben Bernanke has pointed to this, this is a percentage of the population with a job. It's called the employment population ratio. It's a really important number that economists look at.

It shows people are discouraged. They're leaving the job market. Companies are hiring, but they're not hiring enough and there are too few -- you need more people involved in the American labor market. That's what that chart shows you.

So, even if you see strong jobs reports we need to see the other number continue to improve. Dow futures down about 20 points right now.

BERMAN: Where can people watch that jobs report come out?

ROMANS: Right here on CNN exactly at 8:30. BERMAN: It will be live and it will be awesome.

ROMANS: It will be awesome.

BERMAN: Besides that, what's the one thing we need to know about our money?

ROMANS: Mortgage rates. Say good-bye to ultralow rates. It's unlikely they will ever go back to record lows we saw last year, remember, they got below 3.5 percent. They've been rising the past few weeks.

There's talk the Federal Reserve may stop boosting the housing market, you know, pumping money into the economy and that would be something that would mean those mortgage rates would start to rise. So ,there you go.

BERMAN: No more, three never again.

ROMANS: Four is still really low.

BERMAN: Four is the new three.

ROMANS: If you've been cherry-picking waiting for 3.25 percent, I wouldn't hold out.

BERMAN: Coming up, Tropical Storm Andrea on the move. We will tell you where it is going with its soaking rains.

ROMANS: Russia's top man soon to be a single man. Vladimir Putin and his wife officially calling it quits.

BERMAN: Vlad on the prowl.

(COMMERCIAL BREAK)

BERMAN: Weekend washout. Tropical Storm Andrea barreling up the East Coast. Torrential rains, we will tell you if it's coming for you.