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Trump Admits Russia Behind Hacks, Attacks Media; China, Taiwan Exchange Military Shows of Force; Tillerson: China Must Rein in N. Korea's Ballistic Missile, Nuclear Programs; Democrats Suggest Tillerson Lied Under Oath; ExxonMobil's Business Dealings in Africa; Cabinet Picks Split with Trump on Controversial Issues. Aired 2-3a ET

Aired January 12, 2017 - 02:00   ET



[02:00:09] JOHN VAUSE, CNN ANCHOR: This is CNN NEWSROOM live from Los Angeles.

Ahead this hour --


VAUSE: Hello, everybody. Great to have you with us. I'm John Vause. Glad to have you around for the third hour of NEWSROOM L.A.

Donald Trump covered a lot of ground in his first news conference since winning the election. He managed to pick a fight with the news media in the process. Well, us.

Trump says he will turn over his business to his sons to avoid any conflict of interest but he still refuses to release his tax returns. Trump says he will pick a Supreme Court nominee shortly after the inauguration.

But the most explosive moment came when CNN's Jim Acosta tried to ask about Russian interference in the election. Trump called one news site -- not us -- "a pile of garbage," and compared intelligence agencies to Nazis.

Later Wednesday, the top U.S. intelligence chief tried to assure Trump the leaks did not come from them.

Jim Sciutto has details.


DONALD TRUMP, PRESIDENT-ELECT OF THE UNITED STATES: As far as hacking, I think it was Russia.

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT (voice-over): Tonight, for the first time, President-elect Donald Trump accepting the U.S. intelligence community's assessment that Russia is to blame for the unprecedented attack on the 2016 election process. And then, immediately watering down that admission in the very same sentence.

TRUMP: But I think we also get hacked by other countries and other people.

SCIUTTO: Still, the remarks are the most-definitive he has made after months of openly doubting the intelligence community's assessment, which includes that Russian President Vladimir Putin ordered the operation.

TRUMP: He shouldn't have done it. I don't believe he'll be doing it more now.

SCIUTTO: The president-elect's reversal comes after the nation's intelligence chiefs briefed Trump on their classified findings last week. CNN first reported that, at the same briefing, President-elect Trump was presented with documents alleging that Russian operatives claimed to have compromising personal and financial information about him.

TRUMP: It's phony stuff.

SCIUTTO: Today, Trump angrily denied the contents of those claims, accusing the intelligence chiefs of leaking the allegations.

TRUMP: I think it was disgraceful, disgraceful that the intelligence agencies allowed any information that turned out to be so false and fake out.

SCIUTTO: He went on to say that he simply is too cautious when he's traveling for the Russians to have anything damning on him.

TRUMP: I am extremely careful. I'm surrounded by bodyguards. I'm surrounded by people. And I always tell them, anywhere, but I always tell them, if I'm leaving this country, be very careful because in your hotel rooms, and no matter where you go, you're going to probably have cam perhaps. I'm not referring just to Russia, but I would certainly put them in that category.

SCIUTTO: The allegations reigniting questions about Donald Trump's ties to Russia, which he has often touted in the past.

TRUMP: I was in Moscow a couple of months ago. I own the Miss Universe Pageant. And they treated me so great. Putin even sent me a present.


SCIUTTO: In 2013, Trump brought his Miss Universe Pageant to Moscow. Today, Trump maintains he has no connections to Russia. And CNN has not been able to find any current business operations there.

TRUMP: I have no deals in Russia. I have no deals that could happen in Russia because we've stayed away. And I have no loans with Russia.


SCIUTTO: Asked if Russia's hacking was intended to help him get elected, Trump suggested, in his view, that would be a plus. SCIUTTO: If Putin likes Donald Trump, guess what, folks, that's

called an asset, not a liability. Now, I don't know that I'm going to get along with Vladimir Putin. I hope I do. But there's a good chance I won't. And if I don't, do you honestly believe that Hillary would be tougher on Putin than me? Does anybody in this room really believe that? Give me a break.

SCIUTTO (on camera): Director of National Intelligence James Clapper has now released a statement. He says that he spoke directly with President-elect Donald Trump about the intelligence brief on Friday. And immediately after referencing those memos, that document that CNN was the first to report, he said the following, "Part of our obligation is to ensure that policymakers are provided with the fullest possible picture of any matters that might affect national security." In effect, confirming that that document was included in the briefing as CNN was first to report, though President-elect Donald Trump and his advisors denied today. Director of National Intelligence contradicting that in this statement.

Jim Sciutto, CNN, Washington.


[02:05:12] VAUSE: Joining me here in Los Angeles, talk radio host, Mo Kelly; CNN political commentator, John Philips; and in Moscow, CNN contributor, Jill Dougherty.

Thank you all for coming in.

Mo, first to you.

At least the president-elect is admitting there was hacking near the U.S. election. But it seems that he is still handling Russia, the Bear, with kid gloves here.

MO KELLY, RADIO TALK SHOW HOST: Yeah, it's a step in the right direction. But it does not solidify his relationship that he's going to have with the intelligence community. Is he going to take the intelligence community at its word or is he going to fight it every step of the way if they offer something which is not in lock step with what he believes. Because he was adamant a week ago, and now he's walking that back. I mean, that's progress in a certain degree, but I'm not sure that that is going to work long-term.

VAUSE: John, Donald Trump did have some very harsh words, in fact, probably the harshest words in that news conference he had for the intelligence community. He made the Nazi reference. He put it up in a tweet, as well. This is an unprecedented relationship for a new president with the intelligence community, and it does seem that it could create a lot of problems in a very short time span.

JOHN PHILIPS, CNN POLITICAL COMMENTATOR: Somebody leaked that document. Somebody leaked that document, specifically to harm President-elect Trump. I think what you saw today at the press conference was that frustration. I'm happy to see that he is now stating that Russia was behind the hacking because I believe that Russia was behind hacking. I believe, as Mitt Romney said in 2012, they're our largest strategic enemy, globally, going right now.

That being said, the attitude he has about charming Russia is not uncommon among U.S. presidents. Go back to 2012, when you had Barack Obama mocking Mitt Romney for what he said, and saying he wanted a reset with Russia. You can go all the way back to FDR, who tried to strike a relationship with "Uncle Joe" Stalin. This is what presidents do. They go in, they think they're charmers, and after they deal with them for a period of time, they say, maybe they're not as nice as I thought they were.

VAUSE: Jill Dougherty, to you in Moscow, we heard from the president- elect saying that it would be a good thing if Putin likes him, that would be considered to be an asset. Does Vladimir Putin actually like anybody?

JILL DOUGHERTY, CNN CONTRIBUTOR: Well, we won't know, I guess. But I think Vladimir Putin is a very canny person, probably because of his KGB background, and also just the way he is. He assesses people. He sizes them up. And I think the nice things that he said about Donald Trump, he knows are things that Donald Trump would love to hear, the personal references, et cetera. I mean, Vladimir Putin is out for Russia's interests. He's not going to be swayed by, I think, any so- called friendship with any other leader. It's what is in it for Russia. So, it's nice to hear this, but I think, in the end, it means nothing.

And I'm not quite sure it means anything to Donald Trump either in the long run. He does believe that he can sway people and, you know, use that kind of relationship. But certainly, President Putin isn't going to really buy that in the long run.

VAUSE: We also heard from Donald Trump saying that, you know, being essentially very dismissing of our reporting, about Russian intelligence agencies gathering information on Donald Trump, that he was monitored it to some degree whether he I was visiting Moscow a couple of years ago.

Is Donald Trump, of four years ago, back in 2013, the kind of person who the Russians would closely monitor, they would gather information on all of this, of course, despite denials which we heard from the Kremlin?

DOUGHERTY: Oh, I think yes. As you said, they say they do not collect, as it's called, comparamat (ph), which is compromising material. But of course, Donald Trump -- and I have no knowledge of Donald Trump and whether information was collected. But, in general, yes, of course, the Russian intelligence services are interested in anyone they think might it be useful. It could be a businessperson. It could be a journalist. It could be a politician. It could just be some person who comes to Moscow that they think would be useful. In essence, it's a gigantic vacuum cleaner that collects information, stores it, and then maybe sometimes uses it immediately, or puts it away to be used in the future. So, based on my experience, I do not believe the Kremlin when it says it does not collect comparamat (ph).

[02:09:51] VAUSE: And, Mo, during that, the president-elect did admit that the Russians were behind the hacking, but he also went on to say, well, maybe hacking is not such a bad thing. Listen to this.


[02:15:38] JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: But John, keep in mind, what we report, we stand by. And it's also something that other news organizations were reporting as well. It wasn't just CNN. He singled out CNN for this sort of harsh attack. And I thought -- this is the first time he's held a news conference in nearly six months, the first time he's holding a new conference as president-elect -- that we deserve the opportunity to follow up with a question. He did not allow that to occur.

And there was one moment in that press conference when I persisted several times where the press secretary, the incoming press secretary, Sean Spicer, threatened to throw me out of the news conference. He came up to me after the news conference was over and said what I was done was inappropriate and over the line.

But, John, I just want to say, I've covered four presidential campaigns, I've covered the White House under President Obama, I've never had a press secretary threaten to throw me out of a news conference. We were just trying to do our job.

VAUSE: Yeah, that's how news conferences usually work. Reporters ask questions and the person being asked usually answers them in some fashion.

At the start of the news conference, what was interesting, Donald Trump started by praising some news organizations. Listen to this.


TRUMP: I must say that I want to thank a lot of the news organizations here today because they looked at that nonsense that was released by maybe the intelligence agencies, who knows, but maybe the intelligence agencies, which would be a tremendous blot on their record if they, in fact, did that, a tremendous blot, because a thing like that should have never been written, it should have never been had, and it should certainly never have been released.


VAUSE: Is this the media strategy going forward now for Donald Trump to kind of divide and conquer reporters?

ACOSTA: Well, to some extent, that's the way he waged his campaign, John. It was a divisive campaign and Donald Trump rode that sort of angry, hostile energy all the way to the White House. I don't think it's going to work. I think that news organizations, by and large, stand together and stand up for our First Amendment rights here in the United States and we're going to continue to do that.

Having said that, we are entering a period that is rather unprecedented in which the president of the United States -- in 10 days he'll be the president of the United States -- feels it necessary to really go after the news media in ways that we've never seen before. It's going to be a challenge now only to the press but to the First Amendment, writ large, I think, for years to come. And you know, it's something that we're just going to have to stand up for and make sure our rights are protected.

VAUSE: You are in for a very interesting four years. I wish you well.

Jim, thanks so much for being with us.

ACOSTA: Thanks, John.

VAUSE: Still to come on NEWSROOM L.A., the contentious confirmation hearings for one of Trump's cabinet choices. Some Senators question whether he lied under oath.

Also, Taiwan and China at odds once more. We'll discuss how the route of a Chinese warship is causing renewed tensions.


[02:21:46] VAUSE: U.S. Senate republicans have made their first big move to scrap President Obama's signature health care law. They've just approved a budget measure to repeal and replace Obamacare, one of Donald Trump's election promises. The vote went along party lines in a marathon session that stretched well into the night. Democrats are fighting the effort, saying millions of Americans could lose their coverage. Republicans, though, say they will come up with a better plan. The measure now goes to the House, which could vote as soon as Friday.

Taiwan and China have been at odds since Donald Trump broke with decades of protocol on China's One China policy by speaking to Taiwan's president. Now, that is boiling over into a show of military force.

CNN's Asia-Pacific editor, Andrew Stevens, joins us now live from Hong Kong with more on this.

Andrew, this was China sending its only aircraft carrier through the Straits of Taiwan and then Taiwan responding accordingly?

ANDREW STEVENS, CNN ASIA-PACIFIC EDITOR: Absolutely, John. The carrier, as you point out, is the only one in the Chinese navy. It had been doing drills in the South China Sea and was returning home to base, which takes it up the Taiwan Strait, which runs between mainland China and Taiwan. Now, it was in international waters, but it as in what Taiwan describes as an air identification defense zone. So as far as Taiwan was concerned, that meant that it was encroaching a little bit too closely towards Taiwan. They sent up fighter jets, they sent up out navy vessels to basically shut out this flotilla. It all went past, nothing happened. The Chinese vessels are now close to home port. But it does point out just how tense relations are and how those tensions are rising between China and Taiwan. China has always claimed Taiwan is a renegade state. It says it rightfully belongs to China. And it's had a One China policy, which has been recognized, to be honest, by the most of the world, which states that Beijing is the center of all China and Taiwan is part of that.

However, Donald Trump has suggested that -- he's questioning that One China policy. He has taken a telephone call, which broke a lot of diplomatic protocols, from the Taiwanese president. The Taiwanese president the U.S. just this weekend against the wishes of Beijing. So, this has seen as experts as a clear show of intimidation by China against Taiwan. And it just adds to the general narrative of these deteriorating tensions not only between China and Taiwan but between China and the U.S. -- John?

VAUSE: And with that in mind, the testimony we heard today from Rex Tillerson before the Senate confirmation hearing where he talked about forcing China or denying China access to those man-made islands in the South China Sea, that won't help matters. But at the same time, Rex Tillerson was also saying that the U.S. must now compel China to basically bring North Korea in line with sanctions to try and rein in its ballistic missile program and its nuclear program. Hear what Tillerson had to say.


REX TILLERSON, FORMER CEO, EXXONMOBIL & INCOMING SECRETARY OF STATE: I think a lot of our troubles today is that we do not enforce - we make commitments, we say we're going to do something, and then we don't enforce it. And is, again, a mixed message that I think has been sent in the case in North Korea and our expectations of China. I think we have to be clear eyed as to how far China will go and not get overly optimistic as to how far they'll go.


[02:25:10] VAUSE: How is this going to work? On the one hand, you've got these rising tensions over the One China policy, the territorial disputes in the South China Sea, but there's also this admission that they still need China for North Korea.

RIVERS: I think Rex Tillerson has probably got it about right, don't expect too much from China when it comes to North Korea. China is in an interesting position. First of all, there's no love lost between China and the North Korean leader, Kim Jong-Un. Xi Jinping hasn't met with Kim Jong-Un while he's met the South Korean leader something like six times. Gives you an idea of what's going on there. But by the same token, the last thing China wants is a collapse of a state on its borders which could lead to a U.S. military presence on the peninsula in Northern Korea. So, they're going to make sure that doesn't happen at all costs.

So, yes, China does not want to see a nuclear North Korea, but it has to balance that with the fact that it doesn't want a crippled failed state on its doorstep. And Rex Tillerson seems to be recognizing that dichotomy, if you like, facing China. So, where it goes from here -- and as you point out, China is not going to be in any mood to grant favors to the U.S. on North Korea when they are fighting the U.S. on trade, on One China policy, on South China Sea. So really, you can't see how this is going to pan out well as far as China helping the U.S. on North Korea -- John? VAUSE: Tears before bedtime, perhaps.

Andrew, thank you for being with us. Appreciate it. Andrew Stevens, live from Hong Kong.

We'll take a quick break.

"State of America" with Kate Bolduan is up next for our viewers in Asia.

For everyone else, next on NEWSROOM, L.A., we'll have more of Rex Tillerson's day on Capitol Hill defending his former company's actions in Russia, the Middle East and Africa.


[02:30:16] VAUSE: Thanks for staying with us everybody. You're watching CNN NEWSROOM live from Los Angeles. I'm John Vause.

We'll check the headlines right now.


VAUSE: Wednesday was a tough day on Capitol Hill for U.S. secretary of state nominee, Rex Tillerson. During his confirmation hearing, lawmakers on both sides seemed incredulous about his repeated claims that ExxonMobil never lobbied against sanctions. Some Democrats suggested he was lying under oath, pointing to reports showing Exxon spent millions on behalf of Iran and Russia.


SEN. BOB MENENDEZ, (D), NEW JERSEY: Just like you told me earlier that in your conversation with the President-elect you didn't discuss Russia, it's a little difficult to think you actually don't know that Exxon was lobbying on these issues of sanctions.

REX TILLERSON, FORMER CEO, EXXONMOBIL & SECRETARY OF STATE NOMINEE: My understanding is those reports are required whether you're lobbying for something or you're lobby against something. You're still required to report --


MENENDEZ: So you believe you were paying monies to lobby for sanctions?

TILLERSON: I don't know. All I know, Senator, is I don't --

MENENDEZ: Could you imagine being in a position in which you would have your company and its shareholders pay money to lobby for sanctions that would affect your bottom line?

TILLERSON: I don't know, Senator. It would depend on the circumstance.


VAUSE: Democratic Senator Bob Menendez also questioned ExxonMobil's pursuit of a deal in Iraqi Kurdistan despite U.S. opposition. Before that, the company had a $50 billion venture in Iraq's Shia heartland.

VAUSE: And it's not just the Middle East where ExxonMobil is huge. It has big investments as well in Africa. And the anti-corruption watchdog group, Global Witness, was calling on Senators to ask Rex Tillerson specifically about what it calls questionable deals between Exxon and autocratic oil-rich regimes, which have fueled instability and entrenched poverty in some of the world's most volatile regions. Under Tillerson's watch, they say, ExxonMobil has led efforts to gut policies designed to reduce corruption.

One of the few questions during the hearing about Africa touched on a program called PEPFAR, designed to combat HIV and AIDs and was started by President George W. Bush.


REX TILLERSON, FORMER CEO, EXXONMOBIL & INCOMING SECRETARY OF STATE: PEPFAR, I think, clearly, has been one of the most extraordinarily successful programs in Africa. I saw it up close and personal because ExxonMobil had taken on the challenge of eradicating malaria because of business activities in Central Africa where malaria is quite prevalent.


VAUSE: At least we know Tillerson supports PEPFAR, which is a good thing. He also wants to get rid of Malaria, which is also good. But that was pretty much it.

For more on Tillerson and Exxon and its record in Africa, Ian Gary, with the aid group, Oxfam, joins us now from Boston.

Ian, over the years, explain how Exxon has operated in Africa in terms of the deals it is willing to do with dictators and also the transparency around those deals, especially compared to other major oil companies.

IAN GARY, POLICY DIRECTOR, OXFAM AMERICA: Over the last three decades, Exxon has signed deals with dictators across Africa from long-running dictator Eduardo dos Santos in Angola, to President Obiang in Equatorial Guinea, to authoritarian rulers in Nigeria and Chad. And across the continent, they've kept their payments secret. They've kept their contracts secret. And these are situations where the countries are mired in poverty but elites are amassing great wealth. Not only has Exxon looked the other way in terms of corruption but they have actively fought against international efforts to bring more transparency to those financial deals so that citizens in these countries know exactly how much their governments are receiving.

VAUSE: How does the business practice of Exxon under a Rex Tillerson put the company at odds with the U.S. government's foreign policy and goals for Africa?

[02:34:52:] GARY: Well, under the Obama administration, under Secretary Kerry and Secretary Clinton, they prioritized human rights, anti-corruption and transparency in the extractive industries. This was a specific foreign policy goal. They didn't see any separation between our economic security and transparency, good governance in the countries where we are extracting oil. Both Secretaries Kerry and Clinton supported bipartisan legislation that was passed in 2010. Under Rex Tillerson, Exxon, along with the American Petroleum Institute, sued the U.S. government to try to keep their payments secret. Other companies, such as Statoil in Norway, have published their payments, including in places like Angola. This shows it can be done. So, Exxon is on the far end of the spectrum of trying to keep citizens in the dark in the places where they work.

VAUSE: We have heard from Team Trump that Secretary of State Tillerson will be very different from Exxon CEO Rex Tillerson, he will be working for the American people. How do you see it?

GARY: I would say the initial day of testimony was not reassuring. He failed to address how he would deal with human rights issues. He said it's not helpful to label countries as human rights violators. The State Department puts out annual reports on human rights situations, including in countries where Exxon has worked. And that's something that we do. Calling out human rights violations has to be a part of the diplomatic tool kit for the secretary of state. I don't see how somebody who has made a career in the oil business doing deals with dictators can suddenly change their stripes overnight. So, we have big concerns about the experience that Rex Tillerson brings and whether he can shift from being an oil man to a statesman overnight.

VAUSE: OK. I guess we'll see.

Ian, thanks so much for being with us. We appreciate.

GARY: Thanks so much.

VAUSE: Well, the confirmation process has seen some of Donald Trump's top choices split with the president-elect on some key issues. That story still to come on NEWSROOM L.A.


VAUSE: Welcome back, everybody. Some of Donald Trump's top nominees are publicly disagreeing with the president-elect on some of his campaign promises, especially some of the more controversial ones.

Senior Washington correspondent, Jeff Zeleny, has more.



JEFF ZELENY, CNN SENIOR WASHINGTON CORRESPONDENT (voice-over): Donald trump's campaign trail promises -- DONALD TRUMP, PRESIDENT-ELECT OF THE UNITED STATES: What do you think of what - I said it's fine. And if we want to go stronger, I'd go stronger, too.

We're going to build a wall.


TRUMP: We're going to build a big, beautiful wall.


ZELENY: -- aren't being backed up on Capitol Hill, not just by Democrats but his own cabinet nominees.

A second day of confirmation hearings show that Trump's team is at odds with the boss on some of the most hot-button issues.

On trade, the president-elect railed against the Trans-Pacific Partnership.

TRUMP: We will also immediately stop the job-killing Trans-Pacific Partnership, a disaster --


TRUMP: -- another disastrous potential deal.

[02:40:13] ZELENY: Today, secretary of state nominee, Rex Tillerson, took a different view.

TILLERSON: I do not oppose TPP. I share some of his views regarding whether the agreement that was negotiated serves all of America's interests best.

ZELENY: The disagreements run deeper on torture, which attorney general nominee, Jeff Sessions, told the Judiciary Committee.

SEN. JEFF SESSIONS, (R), ALABAMA & SECRTARY OF STATE NOMINEE: Congress has taken an action now, it makes it absolutely improper and illegal to use waterboarding or any other form of torture.

ZELENY: Trump's rhetoric before the election and since is colliding with governing. His perspective cabinet is shedding new light on what a Trump administration would look like.

That old pledge to ban Muslims --

TRUMP: A total and complete shutdown of Muslims entering the United States.

ZELENY: -- that he started walking away from during the campaign met resistance from Sessions and others.

SESSIONS: I have no belief and do not support the idea that Muslims, as a religious group, should be denied admission to the United States. (APPLAUSE)

ZELENY: At Trump Tower today, the president-elect still pledged to build that wall on the border with Mexico.

TRUMP: It's not a fence. It's a wall.

ZELENY: His pick to lead the department of Homeland Security, retired General John Kelly, gently disagreed.

GEN. JOHN KELLY, HOMELAND SECURITY SECRETARY NOMINEE: A physical barrier, in and of itself, will not do the job. It has to be really a layered defense.

ZELENY: And on Russia, Trump's approach to Vladimir Putin --

TRUMP: If Putin likes Donald Trump, I consider that an asset, not a liability.

ZELENY: -- was challenged by the Senate Foreign Relations Committee where his choice for secretary of state struck a harder line than Trump.

TILLERSON: Russia must know that we will be accountable to our commitments and those of our allies, and that Russia must be held to account for its actions.

ZELENY: Jeff Zeleny, CNN, Washington.


VAUSE: Six Volkswagen executives have been indicted over the company's emissions scandal. The German carmaker settled with the U.S. Justice Department a day earlier, agreeing to pay $4.3 billion in federal fines and plead guilty to criminal charges. U.S. Attorney General Loretta Lynch says the carmaker deliberately deceived the American public.


LORETTA LYNCH, U.S. ATTORNEY GENERAL: These vehicles were equipped with software that masked the true amount of the pollutants the cars released, thwarting the regulators who are doing the environmental testing. To be clear, Volkswagen knew of these problems. And when regulators expressed concern, Volkswagen obfuscated, they denied, and they ultimately lied.


VAUSE: The plea deal will also force Volkswagen to hire an independent monitor to oversee the company for at least three years.

Well, thank you for watching CNN NEWSROOM live from Los Angeles. I'm John Vause.

"World Sport" is up next. You're watching CNN.

[03:00:12] ROSEMARY CHURCH, CNN ANCHOR: U-turn. Donald Trump concedes Russia played a --