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NEW DAY SATURDAY

Terrorists Launch Deadly Attack On Hotel; Al Qaeda Affiliate Claims Responsibility For Attack; El Chapo's Lawyer Says He Shouldn't Be Extradited; Sean Penn: "El Chapo" Article Failed; Old DA Struck A "Secret Deal" With Bill Cosby; Iran Sanctions May be Dropped Today; Cruz Offers "Apology" to New Yorkers; Does Winning in Iowa Really Matter; Detroit Teacher Demand Fix for Neglected Schools. Aired 6-7a ET

Aired January 16, 2016 - 06:00   ET

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


(COMMERCIAL BREAK)

[06:00:13] VICTOR BLACKWELL, CNN ANCHOR: This morning we're following breaking news in West Africa. We got new video in. You see the fire here in the streets. There is a bloody battle raging inside a luxury hotel between security forces and terrorists.

CHRISTI PAUL, CNN ANCHOR: We are so grateful to have your company as always. Thank you for being with us. I'm Christi Paul.

BLACKWELL: I'm Victor Blackwell. An al Qaeda-affiliated group is claiming responsibility for this deadly terror attack on a luxury hotel in Burkina Faso.

Here's what we know this morning, at least 23 people all over the world were murdered overnight. Many reportedly at point blank range after a group of militants stormed the hotel popular with terrorists and western diplomats.

PAUL: As of this hour, security forces have rescued more than a hundred hostages, but they've also killed four attackers. Two of them were women.

We have understood, we are waiting to get a live story here from Johannesburg with the very latest where David McKenzie is. As soon as we get him, we will certainly bring that to you.

But again, we are talking about 23 dead from 18 different nationalities here. And that al Qaeda group in the Islamic Maghreb has claimed responsibility.

BLACKWELL: Yes, survivors are recounting the carnage there. Here's what we know right now. Yannick Sawadogo told affiliate, BFMTV, exactly what he saw there. Watch.

(BEGIN VIDEO CLIP)

YANNICK SAWADOGO, SURVIVED ATTACK (through translator): It's horrible because everyone was panicked and lying down on the floor. There was blood everywhere. They were shooting people at point blank.

The sound of the detonation was so loud, we could hear them talking and they were walking around and kept shooting people that seemed alive. They set the cappuccino on fire on their way out.

The smoke started to overcome us. Then survivors started heading towards the door. I couldn't see anyone outside. I managed to make my way out through a broken window.

(END VIDEO CLIP)

PAUL: Sawadogo says he later managed to escape through a broken window. He could barely see because of the smoke. But we do want to get to CNN's David McKenzie is live in Johannesburg with the very latest. Good morning, David, what have you learned?

DAVID MCKENZIE, CNN INTERNATIONAL CORRESPONDENT: Good morning, Christi, yes, this is a horrific terror attack that unfolded late Friday in Burkina Faso in West Africa.

Now, it seems that the gunman was there during the day. At least some of them according to officials posing as tourists or business people.

They were joined by further attackers and then unfolded this attack potentially using explosives of car bombs at the initial stages to create panic.

First, attacking that cafe then moving across the road to that hotel, which is often frequented by rescue. At least 23 dead, according to officials, scores wounded and more than 120 hostages have been rescued by security official, helped by French Special Forces and with assistance from the U.S. military -- Christi.

PAUL: David, when you say they were helped, do we know in what capacity, the U.S. forces were helping. Were they in an advisory position? Were they there on the ground with them? What do we know?

MCKENZIE: We do know at least one U.S. military personnel was on the ground with the forces, but out of an advisory or at least not in the frontline of the siege to get those people out.

According to U.S. officials that there was a request for a drone to gather intelligence on the scene by U.S.' partner, particularly France.

Now this area, Burkina Faso, hasn't seen this level of attack in recent years. Of course, in Mali last year, we reported on that devastating attack at a hotel.

This attack appears to be by the same militant groups, affiliated with al Qaeda and looking to it seems to strengthen their focus on the West African region and also make the biggest statement they can.

At this stage, it is feared that there could be Americans involved in the actual attack. One hostage potentially American according to officials, but they scrambled to get details on those dead and those who survived -- Christi.

PAUL: OK, good to know. David McKenzie, thank you very much. We appreciate it.

BLACKWELL: Let's go now to freelance journalist, Marina Surronetti (ph), she is live there joining us by phone. She is in Burkina Faso. What are you seeing and hearing right now? Marina, do you have us?

MARINA SURRONETTI, JOURNALIST (via telephone): Yes, I do.

BLACKWELL: OK, tell us what you are seeing and hearing there.

SURRONETTI: Hang on. Can you repeat the question?

BLACKWELL: Certainly, tell us what you are seeing and hearing right now.

SURRONETTI: Well, the experience this morning, I was very close to the site of the attack. I was about 300 metres from the home with the army, police force and French Special Forces and a few media, who have gathered on the site. The attacks finished just before noon.

We saw also the president of the country, the new president, Roch Kabore (ph) and prime minister as well. They had a very brief press conference on the site.

They have confirmed a number of casualties, which is 23, and there are 18 different nationalities. Some of the 23 casualties are from the Cappuccino Cafe.

BLACKWELL: Is the gun battle still going on? What is the level of --

SURRONETTI: No, no, no. The siege has finished and actually, this morning, there was a second siege going on. That is the one in terms of the hotel, after that one, another one started in an opposite hotel.

BLACKWELL: A second attack, a second siege there. Is that one ongoing or has that ended as well?

SURRONETTI: That's over as well.

BLACKWELL: OK, do you know if any, according to this news conference from the president this morning, if there were any fatalities in that second siege?

SURRONETTI: That, I cannot confirm that.

BLACKWELL: OK, was this the same group responsible for the second siege if we know?

SBURONETTI: It is (inaudible), yes, the same group.

BLACKWELL: OK. At this moment, what is the scene there? You described what happened earlier, but what's the scene there right now? SURRONETTI: Well, at this moment, aside from the site of the attack, it looked obviously not a lot of people on the street because they were not used to a second attack. They were used to instable for a year first half. But they were not expecting that, especially people working are from extremities of the people in Africa.

So it was a completely unexpected thing to them. A total surprise to them. What we know by the which, we know that last night an Austrian doctor and his wife were kidnapped by rebel in the north of the country.

BLACKWELL: All right. Marina Surronetti, a freelance journalist joining us from the capital in Burkina Faso where that attack happened and now the report of a second siege. Of course, we are working to get more and confirm details about that second hotel. Marina, thank you so much.

PAUL: So let's bring in CNN military analyst, Lt. General Mark Hertling with us now. Lt. General, thank you for being with us.

We know a U.S. Defense official tells us France requested U.S. intelligence, surveillance, and reconnaissance support during this operation.

We were talking to David McKenzie about the fact that U.S. troops may have been involved. In what capacity may they have been used?

LT. GENERAL MARK HERTLING, CNN MILITARY ANALYST: This is part of Africon forces, Christi, and good morning to you. They regularly train the nations in this area in an operation called ACOTA, the African Contingency Operations Training and Assistance.

We have had U.S. forces in the area for several years now. It's been a mixed relationship as they have gotten rid of 30 years of dictatorial rule. They just recently elected in November, President Kapore.

So what you're talking here is a group that is part of the al-Qaeda in the Islamic Maghreb conducting operations in all of these nations in West Africa.

A runoff group, one called Al Mara Batum, that's the word you'll hear. It's a spin off from AQIM led by a guy named (inaudible). He has conducted operations like this in Mali and Niger just this year.

[06:10:01]So you are talking about a continuous effort to stamp out terrorism in these western African countries and under a new president in Burkina Faso, you are finding a government that's trying to stand up and meet the needs of the people. This is disruptive to that.

PAUL: We just heard Marina talk about this second hotel that was also under siege at one point. And it sounds as though she said that is over. But what do you make of the fact within hours you have two separate incidents at two hotels very closely together?

HERTLING: Yes, the coffee shop and the motel were where the primary emphasis attack. Early intelligence says AQIM were able to get some of their operatives inside the coffee shop and then the hotel mingling with the guests yesterday, before they brought more forces in to conduct the attack.

So this is one of those sorts of attacks that's considered complex because there are multiple people involved. It indicates at least some level of training.

And again, this is a city that has not been attacked recently, although, there have been some challenges with stamping out AQIM.

PAUL: OK, just to be clear, Marina was talking about a second hotel, the cafe, one hotel and then a second hotel as well. What do you make of the ability for militants to take over these soft targets like this?

HERTLING: Well the security forces in Burkina Faso are being trained, but I have to candidly say they are not that good yet. They are a part of a wider training effort for several nations. Even though their counterterrorism forces have received a lot of training from both French and U.S. special operators they are still putting together these forces.

So when are you talking about a relatively large city, which the capital is, you can't protect all facilities. These are hotels we have seen in the past that are visited and used by western sources.

So they seem to be the targeted areas by AQIM and really need some not only government security forces but also some contract security forces in these facilities. That's hard to do in West Africa.

PAUL: All right, General Mark Hertling, we so appreciate you being with us and sharing your expertise. Thank you.

HERTLING: Thank you, Christi.

BLACKWELL: This morning, we got a CNN exclusive, a key piece of evidence against Bill Cosby could jeopardize the criminal case against him. Find out how an agreement between Cosby's lawyers and the district attorney ten years ago could derail that case.

PAUL: Also, did the Mexican actress who met with Joaquin El Chapo Guzman accept drug money to start a tequila business in the U.S.? CNN is live for you in Mexico with the details on that.

BLACKWELL: We are expecting a decision from the IAEA at any moment on Iran's compliance with the terms of that nuclear deal. Now if Iran clears this hurdle, it could bring about the big change for the U.S. and Iran.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Today then we prove to the board that threats, sanctions, intimidation, pressure, don't work.

(END VIDEO CLIP) (COMMERCIAL BREAK)

[06:16:04]

BLACKWELL: It's 15 minutes after the hour. New this morning, Joaquin El Chapo Guzman's lawyer is talking out, speaking out, I should say. He is saying the drug kingpin should not be extradited to the U.S.

(BEGIN VIDEO CLIP)

JUAN PABLO BADILL, JOAQUIN "EL CHAPO" GUZMAN'S LAWYER (through translator): I was not granted permission to see my client, Joaquin Guzman Lorea. There was no explanation. They simply said, you can see him.

Mr. Guzman Lorea should not be extradited to the USA or any other foreign country. Why? Because Mexico has fair just laws that are reckoned by the constitution.

(END VIDEO CLIP)

PAUL: OK. So this as senior Mexican officials tell CNN they're investigating whether Guzman funded Mexican actress, Kate Del Castillo's tequila venture.

All right, CNN correspondent, Nick Valencia joining us now. Let's go back here to the extradition (inaudible) first, what is the status of that process right now, Nick, that you know of?

NICK VALENCIA, CNN CORRESPONDENT: Good morning, Christi. This extradition process, it could be a lengthy one, as much as a year before we see El Chapo in one of the seven U.S. states that leveled charges against him.

In similar cases in the past, we've seen it take up to two years. This is all really dependent on that man who you just heard from, the defense attorney of El Chapo, and how many legal petitions that he's filed to keep his client inside Mexico.

The promising thing here, though, is that we haven't seen relations between the two countries, U.S. and Mexico this close since the 1980s that have really could speed up the extradition process.

So far, though, already those legal petitions have been formally filed. We are hearing from sources that they expect this fight to continue to the very end from El Chapo's defense attorneys.

PAUL: Well, that's expected I'm sure. What about this allegation that Kate Del Castillo's tequila venture was funded by El Chapo. How does that play in?

VALENCIA: Every single day, we are seeing a new threat in this dramatic plot here. It's turning out to be a pretty dramatic telenovela for not just people here in Mexico but across the world.

In the last 24 hours, we were told by a senior Mexican law enforcement that they are also investigating a second actress for their role that they played in this meeting between Penn, Del Castillo and El Chapo.

Also as you mentioned this tequila venture has been set up in Delaware for U.S. distribution. We are told by Mexican officials here that they are looking to see if any cartel money, funds, went into that venture to get it up and running -- Christi.

PAUL: All right, I want to get real quickly to Sean Penn's interview with CBS' Charlie Rose and he said that his article on Guzman failed essentially. Let's listen.

(BEGIN VIDEO CLIP)

SEAN PENN, ACTOR: I have a regret the entire discussion of this article ignores its purpose, which was to try to contribute to this discussion about the policy on the war on drugs. How much time have they spent in the last weeks since this article come out talking about that, 1 percent?

UNIDENTIFIED MALE: Are you saying there is not much dialogue about --

PENN: My article failed. Let me be clear, my article has failed.

(END VIDEO CLIP)

PAUL: Do you think -- he's saying his article failed because he wanted to have a conversation about how the government puts so much money into finding one person and that won't make a dent in what happens in the drug trade.

But in terms of Sean Penn, himself, do you think that Mexico, are you getting a sense that Mexico is trying to save face so to speak by blaming this on Sean Penn?

VALENCIA: Well, this is really interesting. Because initially remember, last week, we were told by a source close to the investigation that law enforcement didn't have an idea about this meeting between Penn and El Chapo until that "Rolling Stone" article was published.

[06:20:00]And then in the days after we heard from Mexican attorney general come out publicly to say that they've known about this since mid-September and then you hear in that Sean Penn deflecting his role in what role he played in El Chapo's capture saying El Chapo was not captured until three months later, not captured in the same place where they had the meeting.

So really Penn is saying he is being used as a scapegoat. There is a lot of people out there that really believed him especially with this two conflicting narratives.

One from a source saying that they didn't know, and now publicly a Mexican attorney general saying they did know. Penn adamant that he is being used as a scapegoat -- Christi.

PAUL: All right, Nick Valencia, I know a lot to cover there. Thank you so much for keeping it a surprise. BLACKWELL: All right, consider this, could Bill Cosby get out of this criminal case against him because of a secret deal his lawyers made more than a decade ago? CNN has exclusive details on this new twist in this case.

PAUL: Also, take a look at this, slotted floors, molded ceilings, unsafe playgrounds, this is a public school in Detroit. Conditions are so hazardous that teachers say they can't take it anymore.

(COMMERCIAL BREAK)

[06:23:52]

BLACKWELL: This morning there are new revelations in the criminal case against Bill Cosby. This is a CNN exclusive. We are learning the case may have been doomed from the start. Now you remember Cosby was charged when a new district attorney was elected in Montgomery County, Pennsylvania.

The former DA never charge him even after Cosby gave that deposition during which he admitted giving sedatives to women he wanted to have sex with.

First, watch CNN's Michael Smerconish said exclusive asked last night on "AC 360" about Cosby's case may never go to trial. Start there.

(BEGIN VIDEO CLIP)

MICHAEL SMERCONISH, CNN HOST, "SMERCONISH": And John, I'm holding in my hands an e-mail that was sent from the former DA to his successor three months before Cosby was charged saying, "Hey, wait a minute, you remember. We had a deal, we were not going to prosecute this guy because we didn't think we could meet our burden beyond a reasonable doubt.

We wanted to open the door so that he would give testimony in a civil case. We wanted to help the accuser benefit from a civil judgment."

(END VIDEO CLIP)

BLACKWELL: All right, CNN legal analyst, Joey Jackson is here to talk about this case. Joey, this deal we are learning, was related to this 2005 exchange. It's, I guess, a gentleman's agreement. Does this hold up in court?

[06:25:09]JOEY JACKSON, CNN LEGAL ANALYST: Good morning, Victor. I think the answer to that question is two-fold. The first question really is can a former prosecutor bind a new prosecutor? I think the answer to that specific case is no.

A new prosecutor is elected, based on their own decision, based upon what they feel is appropriate to do and they'll do in the interest of justice what they deem appropriate.

So, no, I believe, although attorneys, lawyers, judges will disagree and agree. I think that an old prosecutor can't bind a new prosecutor.

However, Victor, the biggest issue for me is the event that you agree as a prosecutor to say we are not going forward against Bill Cosby, but we would like the victim to pursue a measure of justice.

Based upon that we will not prosecute you or use anything you say in a deposition against you. That raises thorny questions. To me, then, I do not believe that anything he said in that deposition could be used against him now.

So the question is not really can an old prosecutor bind a new prosecutor. The real question is, could Bill Cosby be prosecuted based upon probably cause and that probably cause being the very deposition he gave because you said to give it and if I gave it, you wouldn't use anything I said against me. So that's really the issue in this case.

BLACKWELL: So very complex here. One thing I wonder, how common it for a DA to say that we won't use whatever you say in a civil case in our criminal case to help the civil litigant.

JACKSON: I think that that's pretty uncommon. The fact is, criminal and civil worlds are difficult. In the event that a victim doesn't get a measure of justice criminally or even if they do, they have every right to pursue a civil case.

Of course, criminal involves liberty and freedom, and civil involves money. In this particular case, apparently, that was the agreement. Go ahead and testify in the civil case. Anything you say we will not use against you.

That's very troubling here, Victor, because we know in that 23-page probable cause affidavit that this new DA released, he uses that civil deposition to establish probable cause.

If I'm Cosby's attorney, I'm moving to suppress. How can you use a civil deposition and induce me to waive my right against self- incrimination then hit me over the head with it. That's problematic?

BLACKWELL: Quickly, I'm talking 5, 10 seconds here, Joey, does the case fall apart now?

JACKSON: I certainly think it does. I think based upon this revelation, I think there are serious questions as to how he could be prosecuted with that deposition. If they could independently prosecute him with some other information that's one thing.

But using after he waves his right to self-incrimination, those statements and derived from that deposition to me is suppressible and, therefore, that's going to be the issue. I think the case is in serious trouble in light of these revelations.

BLACKWELL: Wow, a dramatic turn here. Joey Jackson, always good to have you.

JACKSON: Thank you, Victor. BLACKWELL: Coming up during the 8:00 hour of NEW DAY weekend. Michael Smerconish will be here to talk about this exclusive. Stay with us.

PAUL: We are following breaking news, gunmen storm a hotel in West Africa. Dozens are dead. Many more taken hostage. We have some new details about those attackers now. We'll bring that to you in a live report next.

Also, Donald Trump renewing his fight against Ted Cruz calling him a liability as a candidate. That's not all. Trump cold CNN about Cruz's birther dilemma.

(COMMERCIAL BREAK)

[06:30:16] PAUL: The security minister in Burkina Faso says the siege at the luxury hotel is over this hour. At least 23 people, though, were murdered overnight -- many reportedly at point blank range -- after an alleged Al Qaeda affiliate stormed the West African Hotel that's very popular with tourist and Western diplomats.

BLACKWELL: Security forces say they killed four of the attackers. Two of them were women.

CNN's David McKenzie is live in Johannesburg with the latest for us this morning.

David, good morning.

MCKENZIE: Victor, Christi, good morning. Yes, this is a horrific terror attack that unfolded through the night in West Africa, signs of explosions, chaos, blood on the floor.

Witnesses saying that the attackers went through first at a cafe, killing people, checking if they were alive, and if they were, shooting them in the back of the head. It's eerily similar to an attack last year in Mali by the same group, allegedly Al Qaeda-linked group which are looking to sow terror in that region, striking western assets and soft targets.

Now the latest from the security ministry is that these 23 people dead from 18 nationalities. More missing and scores rescued by a combination of the Burkina Faso forces, the French military and also assisted by the U.S. military.

Victor?

BLACKWELL: All right, David McKenzie for us in Johannesburg. We'll check back throughout the morning. Thanks so much.

Well, after more than three decade, crippling sanctions against Iran may be lifted and this could happen at any minute. That's the word from Mohammad Javad Zarif, the country's foreign minister. He is in Vienna, Austria, right now, meeting with officials from the U.S. and the United Nations.

Now, earlier this morning Zarif offered praise for these diplomatic talks.

(BEGIN VIDEO CLIP)

MOHAMMAD JAVAD ZARIF, IRANIAN PRIME MINISTER: It is extremely important for diplomacy. If today is the day, then we prove to the world that threats, sanctions, intimidation, pressure don't work. Respect works. Through respect, through dialogue, through negotiation, we can impact, reach mutually acceptable solutions.

(END VIDEO CLIP)

BLACKWELL: Iran says it has complied with all terms laid out in the deal to scale back its nuclear program which could be approve and really could prove to be a key momentum in the legacy of Obama administration.

Chris Frates is following this story from Washington for us.

Chris?

(BEGIN VIDEOTAPE)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Thank you.

CHRIS FRATES, CNN INVESTIGATIVE CORRESPONDENT (voice-over): The deal the United States helped cut to curtail Iran's nuclear program is a cornerstone of President Obama's legacy, one that the White House is watching very carefully.

JOSH EARNEST, WHITE HOUSE PRESS SECRETARY: There is ample reason to distrust what Iran says about their nuclear program. Their track record on this is less than stellar.

FRATES: Earnest said that's why the deal calls for the International Atomic Energy Agency to independently verify that Iran is holding up its end of the bargain before economic sanctions are lifted and tens of billions of dollars flow back into the country. And the independent oversight will continue to ensure Iran doesn't cheat.

Progress on the nuclear deal comes after Iran detained 10 Navy sailors when they drifted into Iranian waters while trying to fix their ship's engine earlier this week.

Republicans used the incident to slam the president and the deal.

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: I thought that was humiliating for United States to have these people on their knees with their hands up and guns at their head. And then we have Kerry saying wasn't it wonderful that they let him go? I think it was disgraceful.

Remember this, if we weren't giving them a check in two, three days for $150 billion, they would have never let them go. They would have kept them.

FRATES: While the White House and others credit the relationships built with Iran drawing the nuclear negotiations for the servicemen's quick release.

[06:35:00] JOHN NEGROPONTE, FORMER U.S. AMBASSADOR TO IRAQ: Let's say we hadn't had the nuclear negotiations and we were still in a relationship of much higher tension between the two countries, it's utterly -- it's completely conceivable that they would have held on to these people for a longer amount of time. I have no doubt about that.

(END VIDEOTAPE)

FRATES: Despite progress on the nuclear deal, the relationship between Iran and the U.S. is still tense. Iran continues to detain Americans, including a "Washington Post" reporter Jason Rezaian. And the White House says there are still plenty of reasons to distrust the country. It has not ruled out imposing sanctions over Iran's ballistic missile program.

Victor? Christi?

PAUL: All right, Chris Frates, thank you so much.

Senior international correspondent Frederik Pleitgen picking up the story for us from Berlin there.

So, Fred, good morning to you. Can you take us through the next step here, if this deal goes into effect, then what?

FREDERIK PLEITGEN, CNN CORRESPONDENT: Well, if this deal goes into effect, Christi, and most people believe that it will go into effect today. That we will have what's called implementation day, which means that Iran will comply with all the things it needs to do under the nuclear agreement and therefore the international community, including the U.S. will ease sanctions, considerably on Iran.

The Iranians believe that almost immediately, they would have -- be able to access about $50 billion with the frozen assets that were frozen under the sanction that almost immediately, they will be able to do business electronically, internationally.

Right now, if you want to go to Iran and do business there, you literally have to take a suitcase full of money so you'd be able to do business a lot more easily and they'd be able to sell oil on the international market.

And the Iranians are saying they want to pump about 500,000 barrels per day additionally into the international markets. Of course, they have been waiting to sell their oil for a very long time. So the Iranians hope to get a windfall from all of this very, very quickly.

On the other hand, of course, the U.S. says this means that the Iranians will not easily be able to make a nuclear weapon that they are substantial. Issues with the nuclear program, they won't be able to move that forward if they choose to do so.

So both sides believe they've got a good deal out of this. And then, what the Obama administration also says is, look, for the first time in a very long time, we actually have some sort of relation with Tehran. Of course, the Obama administration believes that to solve the myriad of problems in the Middle East, it will need better relations with Iran.

Christi?

PAUL: All right, Fred Pleitgen, he'll be watching this for us to see if that does indeed happen today.

Fred, thank you so much.

BLACKWELL: Well, teachers in one city, they are taking a stand against unsafe classrooms. CNN is going inside the -- well, you could see these picture. The really hazardous conditions. The dilapidated school buildings that are forcing teachers to walk off the job.

PAUL: Also, presidential candidates revving up ahead of Iowa caucus. Does winning the caucus, though, translate into winning the election? We're going to take a look at how much really the Iowa caucus matters.

(COMMERCIAL BREAK)

[06:40:40] PAUL: Well, new this morning, after Donald Trump and Ted Cruz's birther battle spilled on the debate stage, Trump insist there are still questions over whether Cruz is eligible to be president. Here's some of his conversation with our Jake Tapper.

(BEGIN VIDEO CLIP)

JAKE TAPPER, CNN CHIEF WASHINGTON CORRESPONDENT: The issue about his constitutional eligibility for the office, he brought up an extreme example, an extreme interpretation of natural born citizen, one that wouldn't even allow Marco Rubio to be president.

I know that you have been talking about this challenge, it's something that legal experts and Democrats might invoke. What do you think? Do you think that Ted Cruz is constitutionally eligible? Do you think Marco Rubio?

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: Oh, it's a very, very simple subject in one way. When I say simple, it's simple and that it is a cloud. You can't have a cloud. You can't pick a candidate that may have a 5 percent, 10 percent, 25 percent chance.

By the way, since that happened, there have been lawsuits filed, you know that. It's been filed. And I said lawsuits are going to be filed. The Democrats are going to file lawsuits. They filed lawsuits. Now, he's got a problem. He was born in Canada. He was a Canadian citizen until 15 months ago. I mean, if you can believe that.

TAPPER: He had dual citizenship -- yes.

TRUMP: Yes, but he was a Canadian citizen.

TAPPER: He said he didn't know?

(CROSSTALK)

TRUMP: He didn't know. Well, he didn't know about his financial papers, either. You know, how are you going to be president if you don't know about a million dollar loan from Goldman Sachs and you said it's something you don't know about. Now he doesn't know that he was a Canadian citizen?

(END VIDEO CLIP)

PAUL: Now it is a big weekend on "State of the Union" with Jake Tapper, by the way. You can see that entire interview with Donald Trump, plus, Hillary Clinton, Bernie Sanders, both on the show.

Do not miss "State of the Union," with Jake Tapper tomorrow, Sunday at 9:00 a.m. Eastern only here on CNN.

BLACKWELL: All right. So this morning, Ted Cruz is offering up an apology of sorts to those offended by his recent criticism of New York values. This week, Donald Trump accused Cruz of offending 20 million people when Cruz said Trump embodies New York values.

So what did Cruz mean by that? Well, here's an explanation from Thursday night's debate followed by what he told reporters yesterday in South Carolina.

(BEGIN VIDEO CLIP)

SEN. TED CRUZ, (R-TX) PRESIDENTIAL CANDIDATE: Everyone understands that the values in New York City are socially liberal, are pro- abortion, are pro-gay marriage, focus around money and the media.

I apologize to the millions of New Yorkers who have been let down by liberal politicians in that state. I apologize to the hard working men and women of the state of New York who have been denied jobs because Governor Cuomo won't allow frocking even though there had been many high paying jobs just south of Pennsylvania. New Yorkers are denied the ability to provide for their family.

I apologize to all the pro-life and pro-marriage and pro-second amendment New Yorkers who were told by Governor Cuomo that they have no place in New York because that's not who New Yorkers are.

(END VIDEO CLIP)

BLACKWELL: All right, joining us now, CNN politics executive editor, Mark Preston.

Mark, when is an apology not an apology? So he gets, you know, on our screen. Cruz offers apology to New York. He gets the headlines without actually apologizing for the comment about New York values.

MARK PRESTON, CNN POLITICS EXECUTIVE DIRECTOR: Right and he's not apologizing. I have to tell you, Victor, I am in the camp of the belief that Ted Cruz won this battle during that debate.

Now coming out of the debate, a lot of people said that Donald Trump because he took the higher ground, because he talked about 9/11, because he talked about New Yorker's resolve had won the tit for tat that went back and forth.

However, I'm of the mind that Ted Cruz actually won that, because he was appealing to voters in Iowa, who are going to vote on February 1st, specifically social conservatives, who are pro-gun, who are against gay marriage, who are very, very conservative, very evangelical in many ways.

He is also appealing to voters down in South Carolina who will be voting later on in the month. So I think that Ted Cruz, Victor, did exactly what he wanted to do.

He knew what he was going to do. And, in fact, we saw it last night. His wife, Heidi, sent out a fundraising e-mail where again he did not apologize and who did he go after? And who did she go after? They went after the liberal media.

BLACKWELL: Yes, which is something that is well-received at these debates we've seen and on the campaign trail.

[06:45:00] Let's go to the larger question of Iowa and strategy. Of course, we know that Donald Trump is up nationally in all the polls. In most state polls as well, outside of Iowa. If Cruz loses Iowa, is it over? I mean, essentially this one state strategy, he's waiting for that catapult out of Iowa.

PRESTON: No, you know, I don't think so. It all depends what the margin of victory is. And right now if you talk to folks out in Iowa, Ted Cruz seems to have together a pretty good ground game. Meaning he has volunteers. He has people on the ground, who are going to the caucus.

The big question is, will Donald Trump supporters, those thousands who show up for his rallies, will they come out on a cold night and support Donald Trump when it comes?

I will say this, even if Ted Cruz comes in second place, and it is very close, if he goes into New Hampshire -- Victor, I spent three days in New Hampshire earlier this woke. Ted Cruz is starting to gain momentum in a state that he probably shouldn't be doing well. And quite frankly, six months ago, they didn't even think they had a chance. Ted Cruz could do very well in New Hampshire. And then where does it go then, it goes down to South Carolina, where the evangelical vote again plays a very important role in this primary process. And that's who Ted Cruz is appealing to.

BLACKWELL: And, you know, let me put the question then, that really leads me into the area, the conversation about how much Iowa matters. We've seen, you know, 2012, Rick Santorum won Iowa.

In 2008, we saw Mike Huckabee there. Of course, back in 2000, George W. Bush won there and went on to win the nomination and the general election. But if Cruz wins, is that enough to catapult him beyond New Hampshire, South Carolina, into some of the other states in which they may not be as amenable to his message or his tactics. PRESTON: Well, this is, you know, a really interesting question, because if he does win Iowa right now and he is neck and neck with Donald Trump in the polls. He is going to be going into New Hampshire with a strong wind at his back.

What does that mean? It means potentially he could win New Hampshire. And then where does he go from there? Then he starts to gain momentum. There are now establishment Republicans who do not like Donald Trump. They do not like Ted Cruz, but now they're starting to come to grips with the fact that they're not going to have an establishment candidate as the G.O.P. nominee. So they're going to have to pick sides.

Another reason why Iowa is important and let's put a caveat on the Rick Santorum back in 2012. That night of the Iowa caucus, we all declared that Mitt Romney had won so he had to win behind him, Victor. So Iowa was important. We spend a lot of time there. A lot of media attention. And it's only a few days away.

BLACKWELL: Yes, just a couple of weeks. Mark Preston, excited about it. Thanks so much.

PRESTON: Thanks, Victor.

PAUL: You know, a lot of people, though, are saying if Trump and Clinton are the nominees, they won't vote for either one of them. So we sort of wondering what are your options as a voter. How about a third party candidate?

Coming up this morning, we're introducing you to two third party candidate who are running for president. At 8:00 a.m. Eastern, we're talking live with Jill Stein from the Green Party. At 10:00 a.m. Eastern, we'll hear from libertarian candidate Gary Johnson.

And if you have questions for this third party candidates, do tweet them to us here at NEW DAY. We'll get them to them.

BLACKWELL: All right, looking forward to those conversations.

Would you let your child attend a school that is filled with rotted floors, moulded ceilings, you see here the insect and mouse traps. The teachers in one city saying enough is enough.

PAUL: And look at this video. Millions of dollars in ISIS cash raining down after a U.S. airstrike in Iraq.

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[06:51:23] PAUL: All right. Take a good look at what we've got going on behind us here. Look at this -- damp ceiling, insect infestation, dirty, doorless bathrooms. I mean, these are the awful condition at Spain Elementary Middle School. This is in Detroit.

BLACKWELL: You know, what's sad, though, is there are probably teachers and parents looking at these pictures saying this is nothing. You really want to see a bad school, come to my kid's school. But teachers at Spain Elementary, they are staging a "sick out" and protest because they say the children are suffering because of neglect.

CNN's Jean Casarez has details for us.

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JEAN CASAREZ, CNN CORRESPONDENT (voice-over): School conditions like this at Spain Elementary prompted Detroit public school teachers to call a sick out several days this week. Sixty-four or roughly two- thirds of the city's public schools were closed Monday, leaving thousands of students out of the classroom, sparking Michigan's Division of the Occupational Safety and Health Administration to launch an investigation into Spain Elementary School.

UNIDENTIFIED FEMALE: This is our gym wing. We have been told that this portion of the building is off limits to us as of two months ago. Our pool has been empty like this for about six years. We've now been banned from our own playground. No gym and now no playground.

CASAREZ: Twenty minutes away at Frank Cody High School, principal Latoya Hall King told the national president of the American Teachers Federation, who flew in from Washington for the meeting, conditions at the school are intolerable. From a rodent infestation, to girls bathroom stalls having no doors. The technology classroom, without access to the Internet.

RANDI WENGARTON, PRESIDENT, AMERICAN FEDERATION OF TEACHERS: I see a lot of bad situations. This ranks about some of the worst.

CASAREZ: Additionally, water leaks at the school, fixed but never sealed.

CASAREZ (on camera): I've been in this building about 40 minutes now and I am hoarse. I wasn't hoarse when I walked in. Are you concerned about that for the children?

UNIDENTIFIED FEMALE: Absolutely. There's clearly environmental issues when you have leaks in buildings, when you have carpeting that has been leaked upon.

CASAREZ (voice-over): Darnell Earley, appointed one year ago by the governor to head emergency management for the district, says not all of Detroit's 97 public schools have these issues. And with an accumulated debt of $515 million, they have to make tough decisions on what schools get what improvements first.

DARNELL EARLEY, EMERGENCY MANAGER, DETROIT PUBLIC SCHOOLS: Financially, we don't have the capacity and decisions have been made for years about how best to use those dwindling resources. You have to really use a kind of a crystal ball to decide what's the best way to spend these few dollars.

CASAREZ: This Detroit parent network forum Thursday night, teachers got support across the board, but not everyone agreed on the tactic of the sick out. UNIDENTIFIED FEMALE: I believe it's a bad thing for the children. I believe that their education, you know, should have really been really considered and thought about.

CASAREZ: Although the community is divided on what to do about very real challenges, and until the district can get money, the students will continue to bear the burden.

UNIDENTIFIED FEMALE: What I worry about is losing, losing, losing the teachers and also closing down the schools.

CASAREZ (on-camera): State senator Goeff Hansen tells me that on Friday, he and other lawmakers came here to Detroit to see the conditions for themselves. Legislation has been introduced in Lansing, controversial, he says, which ultimately would allow Detroit public schools to make the necessary repairs to schools where thousands of students attend each and every day.

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[06:55:00] PAUL: All right, it's hard to hear that kid. He's a student worrying about his teachers and losing that. That's a big burden on students. We want to thank Jean Casarez, of course, for that.

BLACKWELL: That's a disgrace to see schools that way. And you wonder why some children may difficulties if the ceiling is leaking and there is mold, and you don't have a door on the stall. There are obviously going to be some challenges.

Let's talk about this. The school system, the mayor and the district's emergency manager and the governor have all now pledged to inspect the schools and they say turn things around.

So there are these search crews now still working to find 12 marines. Remember this story? Missing since their helicopters collided off Hawaii. This was late Thursday.

Coming up, at the top of the hour, we'll have a live report on the search that will resume this morning. Although the weather there is really difficult. The water is choppy and the search, obviously, becoming tougher.

PAUL: And we're taking you back to Michigan, because after months of inaction, Governor Rick Snyder is asking for federal help with the Flint water crisis. Here's the question. Is it just too little, too late at this point?

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