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WH Intervention in Obamacare Repeal; Comey Meets with Congress; South Korea's President Impeached. Aired 4:30-5a ET

Aired March 10, 2017 - 04:30   ET



[04:32:24] CHRISTINE ROMANS, CNN ANCHOR: The White House is prepared to yield to conservatives and fast track the rollback of Medicaid for millions of people. But will those efforts hurt broader efforts to pass the health care bill with moderates?

DAVE BRIGGS, CNN ANCHOR: And with questions surfacing of links with the Trump Organization and a Russian bank, what did the FBI director say about Russian meddling in the election when he met with top members of Congress?

Welcome back to EARLY START, everybody. I'm Dave Briggs.

ROMANS: And I'm Christine Romans. It's a little bit after 4:30 a.m. in the East this Friday morning.

There's morning, growing involvement by the White House in negotiations over the Obamacare repeal bill being met with growing resistance from Republican factions. In what looks to be a major pivot, the White House is privately signaling it is open to a big change in the House Republican bill, rolling back Obamacare's Medicaid expansion years sooner than the current proposal. That's according to two senior administration officials and a senior House conservative aide.

BRIGGS: The shift comes after two House committees sign off on the bill following marathon markup sessions, one running 27 straight grueling hours. But with concerns growing about the measure's content and pace it is being pushed through the House, opponents, Republican opponents, are ramping up their public criticism.


SEN. TOM COTTON (R), ARKANSAS: There is no deadline. We need to get health care right and fast. There are a lot of Republicans who are saying the exact same thing in private. I'm simply saying in public what many Republicans are saying that the legislation as it's written, one, probably cannot pass the Senate. But, two, would not solve the problems of our health care system, problems that Obamacare made worse.

(END VIDEO CLIP) BRIGGS: So, today, a new push in the sales campaign for Obamacare repeal as President Trump meets with key House committee chairman and a vice president sits down with conservative leaders.

The latest now from CNN's Phil Mattingly on Capitol Hill.


PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT: Now, Dave and Christine, conservatives still very wary about this proposal and not guaranteeing that when it gets to the floor, they'll support it at all. All that does is underscored that there's a lot more work to do.

The reality is this, when you talk to House Republican leadership aides, when you talk to Senate and Republican leaders altogether, they say this is the vehicle moving forward. If they want to repeal Obamacare, that issue that they've campaigned on cycle after cycle, this is the moment to do it.

Now, the biggest issue by far is Medicaid. In the bill, as it currently stands, the Medicaid expansion that came with Obamacare would be rolled back in 2020. What conservatives want is 2017. That is problematic going forward. Still, they haven't here at the White House.

[04:35:00] The president telling conservative groups that he is not only open to the idea, but would consider trying to act on it. That would be problematic for both the House and Senate, where a lot of moderate senators, a lot of senators from those Medicaid expansion states simply wouldn't go along.

The reality is this: this bill still moving forward. The process, a little bit slow and certainly ugly. But when you talk to Senate leaders and House leaders, they say they'll still get it done -- Dave and Christine.


ROMANS: Slow and ugly. Welcome to Washington.

If the GOP health care plan is revised to include a faster rollback of the Obamacare Medicaid expansion, that could win over some conservative critics, but it might doom the bill, because several moderate House Republicans backing this current measure, they would then be expected to pull their support.

All of this coming after the chief medical officer of the Medicaid program blasted the Republican health care overhaul. Dr. Andrey Ostrovsky, defending his own boss at Health and Human Services and tweeting, "Despite political messaging from others at HHS, I align with the experts of the academy of family physicians, the American Academy of pediatrics and American Medical Association in opposition to the American Health care Act."

BRIGGS: Despite all the detractors, the former head of the Congressional Budget Office is defending the Republican plan, writing for "The Washington Post", Douglas Holtz Eakin says, quote, "The Affordable Care Act was a one-size-fits-all, top-down approach to policymaking. In contrast, the American Health Care Act moves decision making by providing funding but permitting states flexibility in how to deal with costly pre-existing conditions, provide reinsurance and trusting state insurance regulators to run their markets. Even the significant Medicaid reform needed to ensure the long-term sustainability carries enormous freedom to states to tailor their programs to their populations."

Now, the CBO has yet to weigh in on the Republican plan. That score is expected on Monday.

ROMANS: Douglas Holtz-Eakin, obviously, somebody has a long history in Washington. He has advised presidential candidates. He advised vice presidents. But what he is putting up there I think is the two world views that are colliding. These are two world views that are colliding, the top-down approach was the point of Obamacare, that every single part of health care would be tweaked so that the thing could work together. There are obviously big problems with that.

And then this one, which gives more grassroots -- when liberals hear grassroots, they hear cuts to poor people.

BRIGGS: But when Republicans see that, they see giving freedom and flexibility to the states. That is a Republican core principle. He is the only one making that case.

ROMANS: Yes, he's making that case in "Washington Post" today.

All right. Investigations into Russia's meddling in the U.S. elections heating up this morning. FBI Director James Comey meeting with the congressional Gang of Eight, those eight lawmakers who have access to the most highly classified information. Members of both parties have been accusing the director of stonewalling them.

We get more from CNN's Manu Raju on Capitol Hill.



James Comey up on Capitol Hill as part of this growing investigation into Russia and Russia's attempts to influence the election. And also those questions that still remain about those alleged contacts that occurred between Donald Trump campaign associates and people who are tied to the Kremlin in last year's election, during that time of Russian meddling.

Now, Comey met behind closed doors with the top eight leaders in the House and Senate who get the highly classified information. Two separate meetings conducted behind closed doors and also at a time of growing tension between some of those members and the FBI, about whether or not the FBI is giving them enough information for them to conduct their own reviews. After that briefing, we talked to those members who left. They would

not comment. We are trying to learn details about exactly what was discussed. But we do know it's part of this larger effort to figure out what happened and Russia's attempts to influence the elections -- Christine and Dave.


ROMANS: All right. Manu Raju, thank you.

Four months after early reports of a computer server connection between the Trump Organization and a Russian bank widely dismissed. Did you know an FBI investigation remains open? Sources close to the probe tell CNN it is in the hands of the FBI counterintelligence team. The same team looking into the Russia's suspected interference in the 2016 election.

One U.S. official said investigators find the server connection, quote, "odd", but the official said there is still more work for the FBI to do on this.

BRIGGS: Internet records show that last summer, a server owned by the Russia-based Alfa Bank looked up contact number for a Trump Organization server. And Alfa server did so far more than any other companies about 80 percent of all lookups to the Trump server.

So far, there is no evidence the two servers actually communicated with one another. No allegation of wrongdoing yet. The FBI declined to comment. The White House did not respond to requests for comment.

ROMANS: So, what is the Russian bank in question saying about all this?

CNN senior international correspondent Frederik Pleitgen live in Moscow for this morning.

Now, this Alfa Bank, first of all, it's a big well-known bank, right? This is sort of, you know, household name bank in Russia.

[04:40:04] Why would -- do you know why its server pinging the servers of the Trump Organization?

FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes, Christine, first of all, yes, it's a quite a big bank here in Russia. And second of all, they say, the Alfa Bank, says there's still as well trying to get to the bottom of what exactly happened.

Now, the working hypothesis they say they have, what their own cyber experts have, is they believe that perhaps some of their execs or some of their employees may have stayed at Trump Hotels in the past. And as a result, left e-mail addresses there and that then they were sent spam mail or something like commercial mail from that Trump server. Now they say that possibly, those mails that came through may have triggered their own cyber security. And that their own cyber security may have started what is called a DNS look up, which essentially means that the Alfa Bank server checked to see where these mails were coming from.

Now, Alfa Bank says that it has conducted an investigation, that it actually hired a U.S. cyber security firm to conduct that investigation. They say that investigation is now closed. They have not said that they know where these mails were coming from or whether these things were coming from and why these communications did happen.

Alfa Bank did put out a statement a little bit ago saying none of their executives ever had any sort of contact with Donald Trump. They had no business dealings with Donald Trump and that also, there was no other dealings between the bank and any sort of Donald Trump enterprise.

We contacted Alfa Bank again this morning. They said they are aware of the CNN's new reporting. They are looking into the matter and will get back to us if they have anything new, Christine.

ROMANS: Any statement from them about whether they had done any banking with Donald Trump? Not just their executives staying there, but, you know, we haven't seen his tax returns. So, we don't know if he has loans with any of these foreign banks.

PLEITGEN: Yes. I mean, totally unclear. They say that they listed the top two executives and they say Donald Trump has never had any communications with them or has never had business dealings with them nor any financial dealings. They say there were no financial dealings with the bank either, Christine.

ROMANS: All right. Fred Pleitgen for us in Moscow this morning -- thank you, Fred.

BRIGGS: The Government Ethics Office slamming the White House critics for not disciplining top Trump adviser Kellyanne Conway, after she told TV viewers to, quote, "go buy Ivanka stuff during an interview last month." Ethics director Walter Shaub expressing grave concern over the decision to forego punishment for the Conway's free commercial saying it risks undermining the ethics program. Even more concerning, Shaub says, the administration's repeated claim that many of the ethics rules do not apply to White House employees.

ROMANS: All right. It is jobs day in America. Friday, for most of us. Jobs day in the markets. This is a big one.

Here are four things you need to know: number one, this is the first full jobs report for President Trump. You know, the last jobs report was strong, by the way, only covered 11 days of his presidency. This president promises to create 25 million jobs over the next ten years. That means he needs to average about 208,000 per month.

Number two: What to expect? CNNMoney's survey of economists shows the jobless rate is expected to go down, Dave, to 4.7 percent, 192,000 new jobs added. I think there is potential for an even stronger number. And here's why: this week, ADP, it's a private payroll processor, it reported 298,000 new private sector jobs alone created in February. So, this could be the strongest job creation in months. Now, that ADP report and jobs report sometimes don't mirror each

other. But that ADP number was strong enough for some economists to raise their estimates.

Finally, number three, the Fed, a solid jobs report would clear the way for the Fed to raise interest rates again next week. Investors are now putting the probability at 88 percent. Two weeks ago, it was, you know, which is a fraction of that.

The jump came after comments from several Fed officials that the economy is ready. And I personally, Mr. President, will be watching very carefully to see whether you accept these numbers. These are the numbers that will be used to measure whether that the 25 million job creation over 10 years, that promise is possible. We got, you know --

BRIGGS: Accepting is one thing. Taking credit for is something else entirely. Both will be interesting.

ROMANS: That's right. I mean, his treasury secretary has said these numbers aren't real.

BRIGGS: All right. Well, South Korea's president removed from power leading to deadly protests on the streets. How does this affect the U.S. relationship with Seoul? We are live there next.


[04:48:40] ROMANS: Welcome back.

Breaking overnight: a deadly protest in South Korea, wow, after the country's constitutional court upheld the decision to impeach the country's embattled president. You are looking at images from this morning.

CNN's Paula Hancocks has the breaking details. She is live in Seoul -- where the crowds are still boisterous around you. Good morning.


Well, yes, there are some frayed tempers here on the streets of Seoul. You can see, these are some of the remaining pro-Park protesters. Now, these are the people who did not want Park Geun-hye to be impeached. They believe the allegations of her being involved in corruption and bribery have been made up and they believe the country has made a mistake in impeaching her.

Now, we have seen small pockets of violence. Some tear gas and some clashes with police. We also know that two people have lost their lives because of these protests. There is a huge amount of emotion and passion on the streets of Seoul.

This is a small part of it, though. On the other hand, millions of people pleased that Park Geun-hye has been impeached. Every single Saturday for months now, in the bitter freezing cold Korean winter, they have been coming on streets in hundreds of thousands to call for her impeachment.

Now, the acting president is calling for calm. He knows this decision is not pleasing anyone or everyone.

[04:50:03] But it's important that there is closure. It's important that there is unity. But you can see some people here, it is an incredibly difficult thing to take. Of course, some people here are not only pro-Park Geun-hye, they are anti, the potential next president, the liberal presidential favorite at this point who would like to talk to North Korea and who doesn't necessarily want the U.S. THAAD anti-missile nuclear device here. The THAAD ant-ballistic missile system here.

And so, certainly, these people are concerned about what this means with the relationship with the United States -- Christine.

ROMANS: Certainly, that's an important angle here, both domestic politics, but also, you know, South Korea, very important, Paula, partner of the United States in that region of the world, the region that's absolutely critical.

All right. It is evening there. It's been a day protest. We will let you get back to reporting. And come back to us when events warrant. Thank you, Paula.

BRIGGS: Fascinating story. It matters for the United States as she just hit on, in terms of the engagement with North Korea. But now, the first female president could be open to criminal prosecution without protection of the presidency. So, fascinating story. We'll stay on it for you.

ROMANS: Fifty-one minutes past the hour this Friday morning.

It's jobs day. That means all of those investors out there, looking at that jobs report comes out in about four hours, less than four hours. We're going to get a check on CNN Money Stream, next.


[04:55:48] BRIGGS: WikiLeaks founder Julian Assange is offering to share secret details about stolen CIA hacking tools to help tech companies fix gaps in their security. Assange saying WikiLeaks has a lot of unpublished information about tools it claims allow the CIA to use people's phones and TVs to spy on them.

The big question for the tech companies is, whether they should cooperate with a fugitive in order to possibly fix their products or is this Assange too toxic?

Let's bring in Samuel Burke, CNN Money business and tech correspondent, live for us in London.

Good morning to you, Samuel.

Very helpful suddenly Julian Assange.


What's interesting here is that just because there's been unauthorized release of classified information does not make the information declassified. And that's what puts these tech companies in some very legally murky water. On top of that, there is a PR nightmare. Do they really want to be associated with Julian Assange down the street from the London bureau in the Ecuadorian embassy?

Take a look at one Republican senator has been saying about Julian Assange. Ben Sasse from Nebraska says, quote, "Assange should spend the rest of his life wearing an orange jump suit. He's an enemy of the American people and ally to Vladimir Putin and has dedicated his life's work to endangering innocent lives."

Although I like the solution that Microsoft came up with yesterday. They put out a statement and they simply just put their e-mail address in there and said that we hope if anybody has information that could help us, whether it's the CIA or WikiLeaks, they would just e-mail us here. So, maybe they can get that information and make these products safe both for us, but also for their shareholders, because, of course, they have an obligation to them to try to keep their products as best as possible on the market.

BRIGGS: Samuel, thank you.

ROMANS: All right. Let's get a check on CNN Money Stream.

Investors feeling good this morning ahead of the jobs report. You can see the world markets there. Futures higher. Stock markets in Europe this Friday are up. Asia closing higher.

So, the bull market has been running for eight years, but there's another impressive streak going on. It's been 100 trading days since the Dow or S&P suffered a loss of more than 1 percent. That dates back to early October, 155 days without a drop is the record for the Dow, 185 is the record for the S&P. That's according to S&P/Dow Jones indices.

It started as optimism that Hillary Clinton would win the election. And then turned into the Trump rally with investors cheering the prospects of lower taxes and fewer regulations.

Donald Trump vowing to spend $1 billion on badly needed infrastructure. But a new report shows it may take five times that to fix everything. The American Society of Civil Engineers says we're falling apart basically. It's going to take $4.6 trillion to fix it. It gives an overall grade of D plus to America's infrastructure.

Some highlights, or let's call them lowlights. America's public transit systems received the worst grade, a D-minus. I would agree with that. Airports got a D. The nation's bridges have improved from recent years, but they still get a C-plus. The highest grade was a B for the rail systems.

The group puts out this report every four years. It's important to note that this is a report from engineers. So, guess who's best interested to have infrastructure projects, engineers. So, keep that in mind.

But, look, if you just take a drive across country or take a flight on an airplane, you know what we're talking about.

BRIGGS: I don't think anyone who's suggesting $1 trillion would entirely fix our nation's infrastructure problems. But just that it is needed.


BRIGGS: EARLY START continues right now.


ROMANS: The White House ready for an earlier rollback of Medicaid for millions. This to win over conservatives, but will that cost them votes they'll need to pass the new health care bill with moderates?

BRIGGS: And the FBI director behind closed doors with top members of Congress. What did he say about Russian meddling in the election as questions resurface about links with the Trump Organization and a Russian bank?

Good morning. Thanks for getting an EARLY START with us. I'm Dave Briggs.

ROMANS: I'm Christine Romans. The big question today, will it be a snow day for the Northeast? It is Friday.

BRIGGS: It is for my children. It is official. The text just came.

ROMANS: We are watching our phones wondering if we're going to have to scramble here. It's going to be kind of a messy day in the Northeast here.