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EARLY START

Attack on Flight 17; Day of Mourning in the Netherlands; EU Calls for Tougher Sanction on Russia; FAA Bans Flights to Tel Aviv

Aired July 23, 2014 - 05:30   ET

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


(COMMERCIAL BREAK)

JOHN BERMAN, CNN ANCHOR: Happening now -- a day of mourning. The bodies of victims of Malaysia Airlines Flight 17 leaving on a plane from Ukraine this morning, bound for the Netherlands, that flight leaving just a short time ago. This as new U.S. intelligence pointing to the idea that pro-Russian rebels may have shot down the passenger plane by accident, thinking it was a military aircraft.

But the question remains, who pulled the trigger and could Russia, and its President Vladimir Putin be in some way responsible.

We're covering every angle on this big developing story.

CHRISTINE ROMANS, CNN ANCHOR: Danger in the air this morning, the FAA banning U.S. flights into or out of Tel Aviv. Deadly violence is blamed.

We're live there with the very latest.

Welcome back to EARLY START. I'm Christine Romans.

BERMAN: I'm John Berman. Thirty minutes past the hour right now. We welcome all of our viewers here in the United States and around the world.

And we're starting with new accusations against the pro-Russian rebels in eastern Ukraine. Malaysia's prime minister claiming that these rebels are still interfering with investigators at the crash site. The wreckage of Flight 17.

You look at it it's clear the scene is badly tainted, contaminated. Investigators confirming that they found the plane's cockpit sliced open by a diesel-powered saw.

In the United States, the White House turning up the heat on Moscow, insisting the Russians responsible for the conditions that caused this tragedy.

(BEGIN VIDEO CLIP)

JOSH EARNEST, WHITE HOUSE PRESS SECRETARY: We know that for months now, heavy weapons have been moving across the border from Russia into Ukraine. We know that the Russians have been training Russian-backed separatists in the use of those weapons, including anti-aircraft weapons. We know that the separatists have claimed credit for shooting down three different aircraft in the last several weeks.

(END VIDEO CLIP)

BERMAN: We're going to Phil Black live in Donetsk in Ukraine.

And, Phil, let's start with these accusations from the United States, again pointed directly at the pro-Russian rebels and the latest from the investigation site, the crash site, the crime scene itself.

PHIL BLACK, CNN INTERNATIONAL CORRESPONDENT: The crime scene is so important, John, not the least because it is possible there are still remains of victims somewhere spread out across this very wide area that have not yet been discovered.

So the importance of consolidating that, securing it and maintaining a consistent search, that's important there. And then, of course, there is the great significance of piecing together the various pieces of debris and wreckage to try and get a sense from that physical evidence what may have brought this aircraft down.

And we know from our time on the ground, over the last six days, that every day there is a dramatic degradation in the quality of that evidence. The quality of that crime scene. Really, we've seen a lot of heavy machinery used to move large pieces of debris around. You mentioned the incident with the buzz saw in the cockpit. We saw that. And the damage to that was really incredibly significant.

All of much of this movement and damage was being done because of the delayed effort to remove bodies from the scene. But the problem is that no qualified investigators got to examine this, map it out, closely before that took place.

So now we know there are Malaysian investigators on the ground. They're not satisfied entirely with the access we're getting. Other international teams are still due to come in here but when they do, they will be dealing with a much degraded, much altered crime scene, to try and piece together precisely what happened, what brought the aircraft down.

Another key angle to that investigation is, of course, the cockpit voice and data recorders that have been handed over by Ukrainian -- by the pro-Russian rebels, I should say. We now understand they have arrived in the United States kingdom where they will be examined by experts. And so we'll wait to see precisely what information can be gleaned from those -- John.

BERMAN: There could be key information on the flight data recorder and the cockpit voice recorder as well.

Phil Black live for us in Donetsk. Thanks very much.

ROMANS: All right. A day of mourning has been declared in the Netherlands today as the first wave of victims from the attack on Flight MH-17 leave Ukraine. And now -- right now in the air on the way to the Netherlands. It

turns out there were 200 bodies on those death trains leaving Donetsk meaning the remains of nearly 100 other people on the doomed jetliner are still missing.

Nick Paton Walsh has been with us all morning from Kharkiv, Ukraine. He's there on the tarmac as the C-130s are being very reverently loaded with coffins and then now one of them, at least one of these planes have taken off to go home to the Netherlands.

Nick, what's happening now?

NICK PATON WALSH, CNN SENIOR INTERNATIONAL CORRESPONDENT (via telephone): Well, Christine, the flight that we in the last hour saw (INAUDIBLE) bodies now we were told by Ukrainian officials yesterday that we'd 50 -- the first 50 to depart today. Since we've been standing here, another cargo plane has arrived. Basically there are two on the tarmac. We think one is (INAUDIBLE) much larger capacity than the C-130 transport plane still stands here.

We understand a second plane will be taking off (INAUDIBLE) with all bodies on it. On this tarmac, a somber ceremony (INAUDIBLE), Ukrainian officials and the Australian and Dutch investigators and dignitaries are here to try and rectify what many say is the indignity of the journey that these bodies had back from separatists out there in the tarmac.

The Australian prime minister's special representative is here. They're trying to unite everybody in grief. They're focusing on what's happened. The Ukrainian prime minister, but really the issue here (INAUDIBLE) in Kharkiv yesterday. There's great uncertainty about that. But as (INAUDIBLE) are saying they're able at this stage to say they're confident there are 200 bodies on that train.

There could be significantly more because they are slowly working through the five refrigerated wagons that were on that train. The first two have been opened. The contents of those loaded on to this plane. That process will continue until Friday. The real confusion lies in how the Ukrainian government earlier, separatists, and actually even Malaysian security official, all those traveling on that train, on that train back from separatist-held areas in Kharkiv, said there were 282 bodies that (INAUDIBLE) on that train.

The discrepancy in those figures is going to be hard to reconcile until Dutch investigators have gone through all the five refrigerated wagons and most possibly when all those remains have been transported back to Netherlands for extensive forensic testing there.

That disparity caught because one individual at the crash site told Dutch investigators that 200 bodies have been loaded on. And they're confident in the accuracy of that count. That discrepancy will cause such distress, though, to relatives who simply want some closure. Simply wanted to be able to bury their loved one.

No one really being clear. If at the end of this really, in many ways, gruesome, grim process, we're going to see here as bodies are taken off that train and put into coffins, if that will provide the onslaught to people around the world particularly in the Netherlands or whether they access that crash site yet again, look for more human remains, and even if that happens whether there's still enough there that could satisfy or provide closure for all of those of the 298 people who lost their lives in MH-17 -- Christine.

ROMANS: All right. Nick Paton Walsh, so much work still yet to be done.

Thank you for that, Nick, live this morning in Kharkiv, Ukraine.

BERMAN: And as the families in the Netherlands wait for that plane, those bodies to arrive, all eyes on Russia this morning.

Did the Russian government have anything to do with the shooting down of Malaysia Airlines Flight 17? And if President Vladimir Putin continues to support the rebels in Ukraine, what, if anything, will the world do?

We're live with that part of the story, next.

(COMMERCIAL BREAK)

BERMAN: Vladimir Putin pledging to exert whatever influence he can, whatever influence he has on pro-Russian rebels that the U.S. suspects shot down Flight 17. In a televised speech, President Putin reassured Russians that they face no direct military threat at the moment. While at the same time, he seemed to distance himself a bit from the separatists saying, "We're being urged to use our influence with the militias in southeastern Ukraine. We, of course, will do everything in our power, but that is not nearly enough."

Ukraine's top intelligence official not mincing words, though, insisting that Vladimir Putin has the blood of 298 people on his hands.

Listen to what he told CNN's Kyung Lah.

(BEGIN VIDEO CLIP)

KYUNG LAH, CNN CORRESPONDENT: This wasn't a drunk rebel sitting on top of the missile?

VITALY NAYDA, UKRAINE'S DIRECTOR OF INFORMATIONAL SECURITY: No.

LAH: You believe that was a Russian?

NAYDA: Absolutely.

LAH: A Russian-trained --

NAYDA: Russian-trained, well-equipped, well-educated officer.

LAH: Who pushed that button?

NAYDA: Who pushed on the button. Deliberately. (END VIDEO CLIP)

ROMANS: The European Union now calling for a series of new sanctions, calling for a series of new sanctions to deter rush from supporting these rebels.

Will it work? Did it go far enough? Is it words and not action?

Joining us from London to break this down is Howard Wheeldon, an independent defense and aviation commentator.

And -- you know, Europe is in a tough position here because they are very dependent on Russia for energy. They are -- France, in particular, are very dependent on Russia for, say, shipments of two -- right now, two big ships that they're trying to -- trying to complete a deal on. Did they just talk yesterday? Was that a threat or was that real action?

HOWARD WHEELDON, INDEPENDENT DEFENSE AND AVIATION COMMENTATOR: Yes, I'm afraid lots of rhetoric, lots of cause for more sanctions. But very, very little action. And I don't think there will be a lot of action.

You mentioned the energy -- the energy relationship that particularly Germany and some other countries have with the -- with Russia. It is important for them. Therefore France is in a difficult, more delicate position. Not just on the fact that it's got a billion-dollar to two helicopter landing ships that it's been building for Russia. One of which is almost ready for delivery.

That's a problem. But -- but France doesn't want to upset Germany. They're both members of the -- big members of the European Union. They're both eurozone countries. And there you have Britain which is outside of eurozone but in the E.U., it's calling for more sanctions. It's less affected by the economic impacts of those -- of any sanctions placed on Russia. And it doesn't sell much in the way of defense equipment. A few components here and there, at most, to Russia. So we've got a stop between Britain and France.

BERMAN: Howard, I wonder if you can tie the two major stories in the world right now together a bit for us. Because yesterday, of course, the FAA issuing these flight restrictions into and out of Ben Gurion Airport in Tel Aviv over fears after this rocket exploded about a mile from the airport there.

A lot of people thought this was a drastic perhaps being oversensitive right now to the threats at that airport in Tel Aviv. But is this now the new normal? After what happened to MH Flight 17 over Ukraine, do you suspect that countries and these agencies will be particularly sensitive to these types of threats?

WHEELDON: I think they will be sensitive. I don't -- I don't necessarily agree with the level of sensitivity that is being placed on it. I think it's perfectly understandable that the USA, with its -- special relationship with Israel should be more concerned, perhaps, than others, to be sensitive to it. And that's why we've had the 24- hour ban imposed by the FAA.

Europe has followed suit, but with the recommendation -- recommendation tending to be left to the individual airlines. But not all airlines, British Airways, for instance, is reviewing events on an hourly basis.

I think that's the proper approach. We have a danger here to overreact. But overreaction is something within this day and age is not just -- you know, we see it in a lot of different situations. We regret it afterwards. You could even say the banking crisis, we've overreacted to it. But it is the norm. And so I do think we're going to see more of it.

ROMANS: All right. Howard Wheeldon, independent defense and aviation commentator. Thank you so much for joining us today. Great insight.

Danger in the air, as we told you, the FAA shut down flights to Tel Aviv. Has the violence in Gaza made flying to Israel unsafe? Are we overreacting?

We are live with that controversy, next.

(COMMERCIAL BREAK)

ROMANS: U.S. airlines are forbidden to fly into or out of Ben Gurion International Airport in Tel Aviv this morning. The FAA taking this drastic measure after a rocket landed just about a while away from the airport. An update on the ban is expected shortly after noon Eastern Time.

You know, former New York mayor, Michael Bloomberg, he wants the FAA to reverse that decision. He boarded an El Al flight to Tel Aviv last night to drive home a message.

(BEGIN VIDEO CLIP)

UNIDENTIFIED REPORTER: What are you trying to prove by going there today?

MICHAEL BLOOMBERG, FORMER NYC MAYOR: I'm not trying to prove anything. I'm just trying to show that it's safe and it's a great place to visit. And Israel has a right to defend its people and they're doing exactly what they should.

(END VIDEO CLIP)

ROMANS: All right. Meanwhile, Secretary of State John Kerry has arrived in Tel Aviv despite that flight ban. He's there trying to broker a cease-fire.

Our Martin Savidge is standing by at Ben Gurion International Airport in Tel Aviv.

A lot of moving parts even as John Kerry arrived trying to broker this cease-fire. You have concerns from the Israelis about this FAA flight ban. They say, no, that's hurting us unnecessarily for the terrorism of others. Bring us up to speed.

MARTIN SAVIDGE, CNN CORRESPONDENT: Yes, well exactly the point, ironic that the secretary of state, of course, would fly into Israel, but let's face it, when it comes to the issue of trying to bring about a cease-fire, that would overrule all.

Take a look behind us. You can see the tarmac and the apron there. There is an aircraft, a large one, Ethiopian, obviously not following or having to worry about that ban. But mostly it is quiet here.

You will see El Al, that's of course the national air carrier of Israel, it has always flown, it says it always will despite whatever the circumstances may be. This is the departure terminal. Inside is not a ghost town. It'd be wrong to say there is nobody. There are flights that are leaving and there are notices up on the board. Many of them showing flights leaving on time. There are also quite a few that are listed as cancelled right now.

And you're right, Christine, there are many who believe at least in this country, that Israel is being unfairly punished for what was, in their vision, a terrorist attack on their own land.

I will point out something, just so people have a reference point to how close this rocket came yesterday. If you want to know for sure, you look out to the runway there, and just beyond, you may see some -- immediately after the runway, apartment buildings. High-rises there. That's Yehud. And you can see from this vantage point, it looks pretty close. If you're flying a large body, say, jumbo jet aircraft full of people, you probably do not want to see anything going on that close to you.

So Israel maintains it's got a defensive posture, it has Iron Dome. It's 90 percent effective. But it is not 100 percent. By now, Israel would like to see more U.S. carriers and European planes land here.

ROMANS: Martin, they're going to keep -- they're going to keep assessing this to see what the threats really are. And there will be more discussion of this today and a review of this today.

Martin, thank you so much for that at Ben Gurion airport.

The House and Senate are preparing dueling bills to fight the immigration crisis at the border. Senate Democrats will introduce a measure next week to provide $2.7 billion to deal with the costs of the influx of children from Central America. That's about $1 billion less than the president wanted but it's more than the Republicans in the House is prepared to offer. Less than $2 billion. Homeland Security chief Jeh Johnson said time running short.

(BEGIN VIDEO CLIP)

JEH JOHNSON, DHS SECRETARY: At the current burn rate, given the capacity we've had the surge to deal with this issue, Immigration and Customs Enforcement will run out of money in mid-August. Customs and Border Protection will run out of money in mid-September. And that doing nothing in Congress is not an option. (END VIDEO CLIP)

ROMANS: Another stumbling block, potentially a 2008 law requiring legal protection for children who cross the border. Democrats want it left alone. The GOP wants it scaled back. The only money that's flowing at this point is the money out of people's pockets to the smugglers. Up to $5,000 and more for these children coming across the border. Remarkable.

All right. Apple. Apple at a crossroads. You still love the iPhone. But the iPad not so much. That love affair cooling.

So where does the tech giant go from here? I've got an EARLY START on your money. That's next.

(COMMERCIAL BREAK)

ROMANS: Welcome back. Good morning, everybody. Let's get an EARLY START on your money this morning.

Unrest in Ukraine. Fighting in Gaza, uncertainty in the world. But stocks are moving higher. European shares are higher. U.S. futures, stock futures right now are also up. The S&P 500 reaching the highest price ever during the day yesterday.

The Dow and the Nasdaq higher as well. The Dow this year up 3.2 percent. But the Nasdaq and S&P 500 are up more than that, both up around 7 percent. Driving stocks up this week at least, strong corporate earnings.

Apple profits soared last quarter. Customers gobbling up iPhones and desktop computers but they are so over the iPad. Sales plunged 9 percent for the iPad compared to last year.

Now Apple's stock has done very well this year. Up about 20 percent. Down a little bit this morning in the premarket. But so far this year, look at that stock ride. The company is also swimming in cash but this is a company with a lot to prove. What's the next best big thing for Apple? That's what shareholders want to know.

We got a peek at the iTime. That's a patent revealed, revealing similar features to other smartwatches. But the difference, it can be used apart from a smartphone. Users can get notifications. Still unclear if they can make calls and send texts. So will the next big thing be wearables, a smartphone? At least a patent has been granted. We'll wait to see what the product looks like.

All right. Europe is not really getting tough on Russia. Bottom line here, foreign ministers disagreed over how much pressure to put on Russian President Vladimir Putin yesterday. Those foreign ministers threatened tougher sanctions in the future. Threatened tougher sanctions but didn't take them right now.

Europe's economy tightly linked to Russia as the harsh penalties some say Russia deserves could hurt Europe as well. Hand-wringing but no actions so far. "NEW DAY" starts right now.

CHRIS CUOMO, CNN ANCHOR: We're live from where MH-17 began its journey in the in the Netherlands. We all know how it ended but today it's a very different day.

Behind us rows and rows and flowers and notes and people standing in support of the victims who are finally on their way home.

(BEGIN VIDEO CLIP)

SILENE FREDRIKS, SON KILLED IN FLIGHT 17: I can do nothing but wait for their bodies.

(END VIDEO CLIP)

CUOMO: A plane carrying the remains now in the air, a day of mourning declared all across this small country.

We talk to those who lost loved ones as they plead for answers.

(BEGIN VIDEO CLIP)

SALLAH SAMSUDDIN, SON KILLED IN FLIGHT 17: If they happen to find my son's body, please release it.

(END VIDEO CLIP)

CUOMO: Now the U.S. releasing new intelligence on who shot down the plane and why. The big question, just how involved was Russia? We have the very latest.