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Michael Flynn Controversy Regarding Russia; North Korea Ballistic Missile Test; Trump And Trudeau To Meet At The White House; The 59th Annual Grammy Awards Winners; Steven Mnuchin Expected To Be Confirmed By Senate; Hole In Dam Forces Evacuation In North California. Aired 4:30-5a ET

Aired February 13, 2017 - 04:30   ET



JOHN BERMAN, CNN HOST: -- one of the newest weapons in its arsenal, so how will the Trump administration respond now to this camp?

CHRISTINE ROMANS, CNN HOST: And lawyers head back to court today over the President's travel ban. How will the Justice Department proceed to get the ban back in place? Welcome back to Early Start. I'm Christine Romans.

BERMAN: Nice to see you today, I'm John Berman, 30 minutes after the hour, 4:31 to be exact in the East. And General Michael Flynn, still the President's National Security advisor, for now.

The retired General is under fire for speaking to the Russians about U.S. sanctions before President Trump was sworn into office then misleading or perhaps lying to the public and people as now, Vice President Mike Pence about this conversations, CNN has told that Flynn has no plans to resign and has no expectations of being fired. But one official said there is a lot of unhappiness about this and acknowledge that Flynn's future to White House is no sure thing. Democrats are piling on.


SEN. AL FRANKEN, (D) MINNESOTA: He refused lying about not having to discuss that or he had already forgot.

UNIDENTIFIED MALE: You don't believe that -- but your smile says you don't believe that you forgot.

FRANKEN: I don't think you want a guy who would forget that.


ROMANS: It is important to note the White House is not -- what it's not saying about General Flynn.

Listen to Trump Policy Director Steven Miller deflecting questions about Flynn's future with this administration.

(BEGIN VIDEO CLIP) UNIDENTIFIED MALE: The White House did not give you anything to say other than that on the National plan.

STEVEN MILLER, POLICY DIRECTOR: They did not give me -- they do not give me anything to say.

UNIDENTIFIED MALE: You cannot -- so you cannot say...


UNIDENTIFIED MALE: Asked and answered. The president still has confidence in his National Security advisor.

MILLER: It's not for me to tell you what is in the President's mind. That's a question for the president's chief of staff. Asked and answered.


ROMANS: Asked and answered. For more on the Flynn controversy and the reaction from Russia, let's bring in CNN's Matthew Chance, he is live for us this morning from Moscow. Good morning.

MATTHEW CHANCE, CNN REPORTER: Good morning, Christine. The Kremlin is not exactly defending Michael Flynn. But they are not exactly throwing him under a bus either. Because what they are saying is that to their knowledge, no sanctions were discussed during the conversations which they acknowledge took place in December between U.S. Trump's national security advisor and ambassador to Washington. They say the conversations took place, but again, they're saying sanctions were not discussed. They are also denying here at the Kremlin that the outcome of those conversations had any impact whatsoever on the decision of Vladimir Putin, remember back in December as well, not to respond in kind to the latest sanctions imposed by the outgoing Obama administration, when he expelled 35 diplomats over alleged Russian hacking in U.S. election process.

The expectation back then was that the Russians would do the same in the tip of that response but they didn't. They decided not to do anything instead to hold their horses until the Trump administration came in. Speculation is that is a result of the conversation between Flynn and the Russian ambassador to the United States. But then again, the Kremlin categorically denying that, it all adds to the confusion here about what the -- about the messages coming out of the White House and of the Trump administration and Trump team. What will happen with sanctions? On one hand, you've got element saying sanctions remain in place and thinking about the U.N. ambassador until the occupation, as they call it, in Crimea comes to an end.

And then during the campaign, of course you have President Trump saying he would look at Crimea being legitimately recognizing it as part of Russia. And so there are mixed messages from the Russian point of view coming out of the Trump administration.

ROMANS: Yes. It has been fascinating to watch this. All right, thanks so much for that. Matthew Chance for us this morning in Moscow. BREMAN: All right. We have new developments in the North Korea missile launch this weekend. Pyongyang now claims, it has successfully completed launched the new type medium range ballistic missile. The government says in news agencies says, the test firing guided personally by Supreme Commander Kim Jong-un. This is an early test for North Korea clearly for the Trump administration and now the U.N. is stepping in. I want to go live to Seoul and get the very latest from CNN's Paula Hancock.

Obviously South Korea, very, very interested and concerned about what's being said from Pyongyang and here in the United States.

PAULA HANCOCK, CNN REPORTER: Well, that's right, John. We have heard full scale condemnation from many countries in the region after this intermediate missile launch from North Korea.

We had almost four months of relative restraint from Pyongyang, we have not seen a missile test which when you consider what they did last year 2016 there were more than 20 missile tests. It was quite remarkable how quiet they have been. That has not changed.

And what we have seen according to the Joint Chiefs of Staff here in South Korea is a new and improved intermediate missile. They say that there's a different way in the way that it is fueled. Before, it was liquid fuel, now it is solid fuel. And effectively, that means it can be launched faster, there's less preparation time and potentially in the future, it can be launched from a mobile launcher as well.

So, a more concerning missile launch than just a regular intermediate launch. But of course, it is not that ICBM, that Intercontinental Ballistic Missile that could potentially hit Mainland United States, that Kim Jong-un had promised on January 1st. Not a huge response from Washington at this point. We have only heard from the U.S. President Donald trump that he is 100 percent behind its ally Japan, the Japanese Prime Minister Shinzo Abe standing next to him when he said that. Shinzo Abe actually condemned North Korea more than President Trump did. John.

[04:30:35] BERMAN: And of course, the U.N. Security Council holding an urgent meeting today on this missile test. We will keep following at the day progresses, Paula Hancock, thanks so much.

ROMANS: All right, global diplomacy will dominate the agenda this week on President Trump on Wednesday. He welcomes Israeli Prime Minister Benjamin Netanyahu to the White House. Netanyahu has been full of praise for the President even though Mr. Trump has sent mixed signals lately about Israeli settlement activities in the West Bank.

Today, Canadian Prime Minister Justin Trudeau visits the White House. The Presidents, travel ban plan to renegotiate NAFTA are just two of the obstacles facing these two leaders.

Let's get more this morning from CNN's Athena Jones.

ATHENA JONES, CNN REPORTER: Good morning, John and Christine. The president has another week of diplomacy ahead starting with a meeting and press conference today with Canada's Prime Minister Justin Trudeau. Now, after the inauguration last month, the president said the one of the top items on the agenda when he meets with the Prime Minister would be NAFTA, renegotiating NAFTA was one of the president's central campaign promises. Of course doing so will necessarily require the participation of Mexico and Mexico's President Enrique Pena Nieto. And it's not yet clear when that cancelled meeting with the president will be rescheduled. But these two leaders can certainly get started on that today.

It is worth noting that Prime Minister Trudeau has a very different view on people fleeing danger and persecution than does the president. He was one of the leaders -- the world leaders who responded to the president's travel ban late last month on Twitter by tweeting the refugees are welcome in Canada regardless of their religion. And that travel ban was a big topic as the White House figures out its next steps in the wake of that Ninth Circuit court of appeals ruling that keeps in place a temporary hold on the ban.

President Trump telling reporters over the weekend that he could file a brand new executive order as early as today or tomorrow. He didn't commit to that timeline and the interviews on his aides gave on Sunday seem to suggest that new order might not be quite so imminent. But of course, this White House has been full of surprises. Anything can happen. So we will just have to wait and see what they might decide to announce today or tomorrow. John, Christine.

ROMANS: Athena Jones for us in Florida. Thanks, Athena.

The federal judge in Seattle who first halted the president's travel ban will hearing from both sides later today. Judge James Robart wants to know how the White House plans to proceed. Now that the Ninth Circuits had appealed its restraining order on the travel ban, the Department of Justice has now two options. It can either appeal to the ninth circuit or the Supreme Court or ask to present more evidence in district court to justify the ban. A telephone conference with the judge is scheduled for 6:00 p.m. Eastern Time.

BERMAN: Democrats and some immigration activists are raising concerns about a series of raids in recent days. Hundreds of immigrants have been rounded up in areas including New York and Los Angeles, other places as well. Officials from the immigration department say these raids were routine and even planned for weeks. President Trump is taking credit for them. He writes, he is merely keeping a Campaign promise to remove gang member and drug dealer from the country.

ROMANS: More false claims of voter fraud from the President Trump's inner circle. Senior policy advisor Steven Miller insisting people were bussed from Massachusetts to New Hampshire to vote illegally in the presidential election.

Listen to him tangle with ABC's George Stephanopoulos claiming Trump would have won the swing state if not for thousands of illegally cast votes for Clinton.

(BEGIN VIDEO CLIP) MILLER: Voter fraud is a serious problem in the country. You have millions of people who are registered in two states or who are dead and registered to vote.

GEORGE STEPHANOPOULOS, ABC HOST: You can't make a -- hold on a second. You just claimed again that there was illegal voting in -- in New Hampshire. People bussed from the State of Massachusetts. Do you have evidence to back that up?


MILLER: George, go to New Hampshire. Talk to anybody working in politics there for a long time. Everybody is aware of the problem in New Hampshire with respect to...


STEPENAPOLIS: I'm asking as White House senior policy adviser, the president made a statement saying he was the victim of voter fraud...


STEPENAPOLIS: Do you have any evidence?

MILLER: If this is an issue that interests you that we could talk about it more in the future.


ROMANS: All right, President Trump praised Miller for his performance on the Sunday talk shows. New Hampshire's Democratic Senator Jeanne Shaheen, she was not so impressed, tweeting this, as everybody knows Steven Miller has no evidence of voter fraud in New Hampshire. This has been debunked. Donald Trump did not call for a recount.

[04:40:10] BREMAN: A friend of the president, News Maxx CEO, Christopher Ruddy, is slamming the White House Chief of Staff Reince Priebus. Ruddy told CNN that one the president's big problems is Priebus.


CHRISTOPHER RUDDY, CEO, NEWS MAXX: I think there is a lot of weakness coming out from the chief of Staff. I think Reince Priebus, good guy, well-intentioned, but he clearly doesn't know how the federal agencies work. I do think the president is not getting the backup he needs in the operation of the White House. And sometimes the push back that he needs which you would have with the stronger White House Council, the White House chief of staff.


BERMAN: That interview with Brian Stelter. Is pretty interesting, right?

ROMANS: Yes. BERMAN: Christopher Ruddy, he's a member of Mar-A-Lago, he has the President's ear, he chats with the president when his down there, so clearly has something the president himself deserved. Ruddy seemed to dial back that criticism a little bit later saying that he actually spoken to Reince Priebus and he just got to keep an open mind.

ROMANS: It's just fascinating to see that inner circle, and what's going on...


ROMANS: ... with the friends of the president and inner circle of the president. It wasn't a hostile to takeover of the GOP, right?



ROMANS: Now, you are seeing kin of a jockeying of who has the president's ear, and who he trusts. All right. Emotions run high at the Grammy awards. The winners and surprises and the tribute that literally brought the show to a stop.


[04:45:35] (BEGIN VIDEO CLIP)

ADELE: I'm sorry for swearing and I'm sorry for starting again. Can we please start it again? I'm sorry and I promise. I'm sorry.


BERMAN: That was Adele who called for a mulligan at the Grammys Awards overnight. She was trying to see right there to pay tribute to George Michael. But she stop mid-song, she asked to start again. The crowd loved it. The crowd loved Adele period so did the Grammy voters, she swept the top honors all and pay a tribute to Beyonce apparently. The industry's big night, some people thought it would be a political spectacle. It wasn't tons of that but there was some. CNN's Stephanie Elam at the show, she has the latest from Los Angeles.

STEPHANIE ELAM, CNN REPORTER: John and Christine, Adele reigned at the Grammy's winning five awards including the three top prizes, Album of the Year, Record of the Year, and Song of the Year. Later when accepting Album of the Year for 25, Adele said she thought Beyonce should have won.


ADELE, SINGER: The Lemonade Album was just so monumental. Beyonce is so monumental, and so well thought out, and so beautiful and soul bearing. And we all got to see another side to you that you don't always let us see. We appreciate that. All of us artists adore you. You are our light.

(END VIDEO CLIP) ELAM: Beyonce's performance was visual feast in a tribute to Motherhood, with her mom introducing her. Daughter Blue Ivy in the audience and of course, her baby bump on full display.

Also making a statement on stage, Katy Perry who ended her performance with an image of the Constitution, but the most overt political statement came from a tribe called Quest, Buster Rhymes, who referred it as President Agent Orange. But in a show of support for President Trump, singer Joy Villa wore a gown that read make America Great Again, and Trump along the back. Christine and John.

ROMANS: Stephanie looks awesome.

BERMAN: Stephanie always looks awesome. She handles it so well.

ROMANS: I know, it's great because I can never stay up that late. So Stephanie can boil it down for me. Now, I can talk around the water cooler smartly about the Grammys.

BERMAN: That Adele, now, my little thing is, with Adele's song hello. I feel that was from 2012. Why is it only winning the Grammy for best recording now?

ROMANS: I don't know.

BERMAN: It's been around forever.

ROMANS: I don't know.

BERMAN: I was like 11 when I first heard that song.

ROMANS: You still are 11, and I know it. All right. More stores are dropping Trump's branded products. Sears and Kmart stores stopped selling Trump home merchandise online. That's according to our report. The items are not on the store web sites anymore but can be bought from third party vendors. Some items were not sold in stores. So far, Nordstrom, Neeman Marcus and the parent company of T-J-Maxx and Marshall could either dropped the brand or move it to less prominent position.

Much of that surrounds the Ivanka Trump clothing line, online sales of her brand dipped in 26 percent in January compare to year or earlier, that's according to Slice Intelligence, a retail Analysis Firm. It studied the brand sales on five online stores, Nordstrom, Amazon, Zappos, Macy's and Bloomingdale.

The report in the Wall Street Journal claiming Ivanka Trump clothing sales at the Nordstrom plunged 70 percent, during the last three weeks of October leading up to the election, which suggests that would the business decision, the sales decision, that Nordstrom was making.

BERMAN: All right. New evacuations ordered overnight in Northern California over structure concerns of a Dam.


ROMANS: This is remarkable.

BERMAN: Look at these pictures here. Officials moved nearly 200,000 residents, 200,000 people have been moved out of the path. This is after there's a hole in the dam's spillway. And there are serious concerns this morning about what could be intense flooding downstream.


KEVIN LAWSON, INCIDENT COMMANDER: We have water over the top of the emergency spillway. It was beginning to erode the ground, right, and when you start to erode the ground and the dirt and everything else starts to Rolls off the hill. And it starts to undermine itself. If that is not addressed and we don't take care of that and mitigate it properly, essentially what we're looking at is approximately a 30-foot wall of water.


BERMAN: Officials are waiting for first light this morning to better assess the situation, decide when it is safe for residents to return.

ROMANS: Spelling counts it turns out the hard lesson being learned by the social media team by the Department of Education.

BERMAN: Department of Education.

ROMANS: The folk there misspelling the name of a prominent educator, author of the right activist, WEB Deblois. In a tweet, Sunday, the tweet contains a notable quote on the importance of education. But they misspelled his name and they put an e instead of E instead of a U in Dubois. When they notice the mistake, hours later, they messed up the apology. Tweeting, post updated -- our deepest apologizes for the earlier typo. Third time was the charm for the DOE 16 to read our deepest apologies for the earlier typo.

[04:50:20] BERMAN: You see, I can't spell. I really can't, I can't spell as you well know.

ROMANS: I know, I know.

BERMAN: I have typos. I'm not the Department of Education. It is OK for me. It is not OK for them.

ROMANS: I feel bad. What if it's like -- I don't know. What if it is a 24-year-old Intern staffer who actually did it and now got fired?

BERMAN: Proofread.

ROMANS: Proofread.

BERMAN: Spell check.

ROMANS: All right, all right. So the president's travel ban in legal limbo. Some workers with special visas are facing tough choices including this Syrian doctor. He treats children in Sioux Falls, South Dakota. In fact all over South Dakota in some of the most rural underserved areas of America. The tough choices caused by the travel ban next.


[04:55:01] ROMANS: A real world example this morning of how the president's travel ban is disrupting -- disrupting the lives of people both inside and outside the U.S. and that's not exclusive to immigrants. Rural doctors here on special J-1 visas are working in the underserved areas of U.S. There are about 1,500 of them given these temporary visas each year.

Doctor Alaa Al Nofal lives in Sioux Falls, South Dakota. He's from Syria. He lives in the U.S. with his wife and his 10-month-old baby. He wants to bring his baby back to Syria to see his family, but he fears if he leaves, he won't be let back into U.S. and that would hurt his patients. Here's a bit of his story.

ALAA AL NOFAL, DOCTOR: I think that will be helpful.

UNIDENTIFIED FEMALE: Well said, honey.

AL NOFAL: I know. I think -- I think that's true.




UNIDENTIFIED FEMALE: I love you so much.

AL NOFAL: They did not consider that that executive order is not going to affect just people of the seven countries. It's going to also affect people in the United States, people in rural America.


ROMANS: In a comment to CNN Money, the State Department said exceptions to the travel and visa ban could be issued on a case by case basis, if it is in a national interest. But they did not specify the doctor shortage in a rural area would be considered.


AL NOFAL: And that's what worries us because we don't know what's going to happen a year and a half or two years from now. If everything's don't work-out, we might need to move out of the United States.

I think that National Security is important for this country. However, the way they are doing at it to try to make the country safe, I don't think has been the right way so far.

UNIDENTIFIED FEMALE: For our family, it really disappoints me that this was done because it's teaching my son that people from the new countries are threats. I don't want him growing up thinking people from Syria and his family is a threat, because they are not. (END VIDEO CLIP)

ROMANS: The Trump administration has not moved to revoke the J-1 visas that doctors use. And it is unclear if it would be part of the immigrant racing reform or additional executive action. A lot of anxiety from people, from Syria and those other six countries who are here helping the American population as doctors. You can check out more on Doctor Al Nofal story on CNN Money. He is a fascinating person to look through, you know.

BERMAN: Look, one of the big issues here was the pace of the initial executive order, which is putting everything in place instantly.

ROMANS: Right.

BERMAN: And that was jarring -- jarring, changes for everybody. Look, if they do it again, people have a warning.

ROMANS: And there is a -- and there's a big question of restricting immigration in general. You know, like some of these programs are very well thought out. He is a pediatric endocrinologist. What he's doing here is good for this country. So, you know, how thoughtful would they be, are redesigning the immigration and immigration flows in the U.S. and are they being thoughtful about it or they just putting up walls?

ROMANS: Let's go to check CNN Money Stream this morning. The stock market sitting at the highest levels in history, the Dow, NASDAQ and S&P 500 and even the Russell 2000, that measures small caps sacks, all closing last week at record highs. President Trump's comments about the tax reform package really put this rally back on track. Futures higher this morning as well. Stocks in Europe are rising, shares in Asia finishing higher overnight.

Just six weeks into the trading year, the NASDAQ is already up more than 5 percent. The big winner of the big three averages, S&P 500 up to three and a half percent, the Dow performance, up two percent.

BREMAN: Are they completive with each other? Does the S&P fight with the DOW and NASDAQ.

ROMANS: I'm not sure they are aware with each other. I watch them very, very closely. And like my children, I set them apart, against each other.

BERMAN: Hey, I like your children, you like one more than the other. What would your favorite these days?

ROMANS: I prefer the S&P 500 personally.

BERMAN: You see.

ROMANS: The middle one.

BERMAN: There's always one that's the favorite. Early Start continues right now. ROMANS: New turbulence surrounding National Security advisor Michael Flynn calling his revelation he spoke with Russia about sanctions. He has no plans to go anywhere, but some inside the White House tells CNN that is no guarantee.

BERMAN: North Korea claims the missile test this weekend was a new technology they were testing out. We heard from the president Saturday night, less than 30 seconds, what will he say today about this clear challenge from Pyongyang?

ROMANS: And the president's travel ban goes back before a judge today. How will the Justice Department proceed in the effort to get the ban back in place?

Good morning and welcome to Early Start. I'm Christine Romans.

BERMAN: Nice to see you today. I'm John Berman. It is Monday, February 13th. Valentine's Day eve, 5:00 a.m. in the East this morning. This morning, as we sit here, Michael Flynn, he is the president's national security advisor for now. The retired general is under fire for speaking to the Russians about U.S. sanctions before President Trump was sworn and then misleading or depending on who you talk to, just flat out lying to the public --