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Russia Investigation on Hold; Health Care Back on the Table; GOP Going Nuclear; Trump: "We're Doing Very Well in Iraq"; British Prime Minister Triggers Brexit. Aired 4:30-5a ET

Aired March 29, 2017 - 04:30   ET



[04:31:16] DAVE BRIGGS, CNN ANCHOR: The House investigation into the Trump campaign ties to Russia on hold. How long until things get moving and will we ever hear from the former Justice Department official who could have damaging evidence.

CHRISTINE ROMANS, CNN ANCHOR: New signs of life on health care from the Republicans? After declaring he was moving on, is the president now ready to re-engage with lawmakers who spurned him.

BRIGGS: And Republicans are going all in on Neil Gorsuch. A vote expected for next week despite a growing number of Democrats ready to filibuster the Supreme Court nominee.

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

ROMANS: And I'm Christine Romans. It's 31 minutes past the hour.

On the schedule for the House Intelligence Committee investigating alleged ties between Trump and Russia -- nothing. No meetings. No hearings. No nothing. Crickets from that House committee.

The Trump-Russia probe has completely broken down at least for now amid this growing divide over whether House Intel Chairman Devin Nunes should recuse himself from that probe. Those calls coming from a growing number of Democrats but even now from the ranks of Nunes' own party, Elijah Cummings, the ranking Democrat on the House Oversight Committee points to a claim made by Nunes that he was on the White House grounds to read classified material but that no one on the White House grounds was aware.

Elijah Cummings says this, "The claim by Chairman Nunes no one knew in the White House knew about his visit cannot be true. Chairman Nunes was not a White House fence jumper. He was invited in."

BRIGGS: Glad that he clarified that.

Now, there's a Republican House member saying Nunes should recuse himself. Walter Jones of North Carolina.

Meantime, Nunes is scoffing at the suggestion that he might step aside.


MANU RAJU, CNN SENIOR CONGRESSIONAL REPORTER: Are you going to stay as chairman and run this investigation?

REP. DEVIN NUNES (R-CA), HOUSE INTELLIGENCE COMMITTEE CHAIRMAN: Well, why would I not? You guys need go ask them why these things are being said.

RAJU: Can this investigation continue as you as chairman?

NUNES: Why would it not? Am I not briefing you guys continuously and keeping you up to speed?

RAJU: But they're saying that it cannot run with you as chairman.

NUNES: You got to talk to them. That sounds like their problem.


BRIGGS: Before the investigation resumes, the ranking Democrat on the House Intelligence Committee, Adam Schiff, he wants Republicans to agree to reschedule hearings that had been set for yesterday. Among them, one of which the former Acting Attorney General Sally Yates was expected to testify about communications between former Trump national security advisor Michael Flynn and Russia's ambassador to the U.S.

ROMANS: "The Washington Post" reported Tuesday that the White House sought to block Yates from testifying, a claim Press Secretary Sean Spicer adamantly rejected.


SEAN SPICER, WHITE HOUSE PRESS SECRETARY: The 24th, Miss Yates' attorney sent a letter to the White House counsel requesting that consent specifically stating that if they did not receive a response by March 27th at 10:00 a.m. They would, quote, "conclude that the White House does not assert executive privilege over these matters. The White House did not respond and took no action that prevented Miss Yates from testifying."

I hope she testifies. I look forward to it.


ROMANS: There's at least one investigation moving forward in a bipartisan spirit today. The chairman and the ranking Democrat on the Senate Intel Committee will offer an update on their Russia investigation at a 2:30 p.m. news conference.

BRIGGS: Spicer may be running out of ways to downplay the Trump administration's ties to Russia. Listen to the press secretary getting into a rather testy exchange with reporters after suggesting the media is looking for Kremlin connections that don't exist.


SPICER: I said it from the day that I got here until whatever, that there's no connection. You've got Russia. If the president puts Russian salad dressing on his salad tonight, somehow there's a Russian connection.

But every single person -- no, well, no, that's -- I appreciate your agenda here but the reality is -- no, no, hold on.

[04:35:06] No, at some point, report the facts. The facts are that every single person who has been briefed on this subject has come away with the same conclusion. Republican, Democrat, so I'm sorry that disgusts you. You're shaking your head. I appreciate it.


SPICER: But, OK, but understand this, that at some point, the facts are what they are.


BRIGGS: April Ryan of American Urban Radio asked that question that set Mr. Spicer off. She was also the reporter Spicer told to stop shaking her head. She will join us live in the 8:00 a.m. hour of NEW DAY and said, "I'm sorry that disgusts you." It's this that disgusts us. It's Russian dressing.

ROMANS: I can't believe we have Russian dressing for breakfast.

BRIGGS: That, not that shaking of the head but just that.

ROMANS: Russian dressing. All right.

Republicans insisted they had no plan B on health care, so since we're talk about insurance we'll talk this plan A rider number one. Just days after the House GOP effort to repeal Obamacare ended in disaster, we're learning the issue is now back on the table if it was ever really off. Officials telling us the president and vice president spoke with several House members over the weekend about a path forward.

Even so, the White House now keeping a lower profile, encouraging talks between members of the ultraconservative Freedom Caucus and moderate Tuesday Group.

BRIGGS: A senior administration official says members whose opposition helped kill the House bill last week are, quote, "terrified" of backlash. Backlash that some are already getting from their constituents who elected them to repeal and replace. Official says the White House believes its threat to move past health care helped jolt Republicans into action. And last night, President Trump all but admitted he's not done with tissue.

For the latest, let's bring in our senior White House correspondent Jeff Zeleny.


JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Christine and Dave, five days after the collapse of the health care bill, President Trump, the White House and some members on Capitol Hill are talking about reviving the bill and doing another type of deal. Now, they are in the very early beginning stages of talking about this. One is the pressure from the outside. Republicans, of course elected many of these people for years really to do something about health care and after the dramatic failure last week, of course, it fell apart.

But now, there are serious talks going on. And President Trump invited senators from both parties to the White House last night. And he mentioned health care actually isn't that hard.

Let's watch.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I know that we're all going to make a deal on health care. That's such an easy one. So, I have no doubt that will happen very quickly. I think it will actually. I think it's going to happen, because we've all been promising, Democrat, Republican, we've all been promising that to the American people. So, I think a lot of good things are going to happen there.

ZELENY: Such an easy one the president says. But, of course, he knows all too well health care legislation is so much more difficult than that. But the fact that he invited bipartisan group of senators to the White House is the latest in a series of steps this White House is calling a course correction. They want to bring some Democrats on board as well to try and get some difficult pieces of legislation through.

We'll see if health care falls in that list or not. But, Christine and Dave, he certainly talked about it here last night.


ROMANS: All right. Jeff Zeleny, a course correction. Fascinating.

All right. The number of Senate Democrats declaring opposition to Supreme Court Neil Gorsuch is growing this morning. Senate Majority Leader Mitch McConnell has now set a date for a floor vote on the nomination, defiantly predicting the Gorsuch will be confirmed next Friday. The Judiciary Committee has already set to vote on Monday and McConnell says he wants the full Senate to vote before lawmakers head off for a two-week spring break.

BRIGGS: McConnell and Democratic Leader Chuck Schumer already squaring off over the Republican threat to invoke the nuclear option. That, of course, would change Senate rules to end the filibuster on high court nominees so they can be confirmed by 51 votes instead of 60.


SEN. MITCH MCCONNELL (R-KY), SENATE MAJORITY LEADER: We're going to get Judge Gorsuch confirmed. It will be an opportunity for Democrats to invoke cloture. We'll see where that ends, but it will really up to them how the process to confirm Judge Gorsuch goes forward.

SEN. CHARLES SCHUMER (D-NY), SENATE MINORITY LEADER: It's going to be a real uphill climb for him to get those 60 votes. It's such an important position. It should have bipartisan buy in. If a judge can't meet, if a nominee can't meet the 60 vote standard, you don't change the rules.


ROMANS: As of now, 27 senators plan to filibuster the Gorsuch nomination. Three Democrats haven't said whether they will join the filibuster but said they would vote against Gorsuch on the floor, and only two had said they won't take part in the filibuster. That's out of eight that Republicans need to break it.

New details this morning about president's budget blueprint documents reviewed by CNN shows a long list of new cuts that could save the government $18 billion this year and help offset that big boost in defense spending. The steepest cut, $3 billion to education programs, that includes $1.2 billion less for teacher-oriented grants, which officials say are unproven and poorly targeted, and $1.3 billion cut to surpluses in the Pell Grant program.

[04:40:07] Officials tell us that would still leave it with enough funding. The Pell Grant program critical for poor students to be able to afford rising costs of college. The document says a one point, $6 billion decrease to housing and urban and a billion in reduction to international aid, which cuts funding for programs targeting HIV/AIDS and for U.N. peacekeeping efforts. Nearly a billion dollars taken away from programs that provide disaster relief and senior citizens.

On those cuts, an administration official says it's not a core function for the government to promote some of these things. Expect major backlash for special interest groups, Democrats and even some Republicans whose districts rely on that money.

All right. She's emerged from the woods and now re-entered the political debate. There she is last night speaking at a women's conference in San Francisco. Hillary Clinton gave her most pointed speech since the election. She spoke largely about women's equality and inclusivity in the workplace. She called out the exchange between Sean Spicer and April Ryan we showed you earlier.


HILLARY CLINTON (D), FORMER PRESIDENTIAL CANDIDATE: April Ryan, a respected journalist with unrivalled integrity, was doing her job just this afternoon in the White House press room when she was patronized and cut off trying to ask a question. Too many women, especially women of color have had a lifetime of practice taking precisely these kinds of indignities in stride. But why should we have to? And any woman who thinks this couldn't be directed at her is living in a dream world.



ROMANS: Hillary Clinton also told the crowd, quote, "There's no place I rather be than here with you, other than the White House."

BRIGGS: Two anti-abortion activists now facing 15 felony charges in California for secretly taping footage at Planned Parenthood locations. The California attorney general says David Daleiden and Sandra Merritt used bogus identities and claimed they worked for a fictitious bio research company, so they could record confidential conversations. Daleiden's anti-abortion group, The Center for Medical Progress, claimed the undercover videos prove Planned Parenthood sells aborted fetal tissue for research, something Planned Parenthood denies.

A spokesperson for Planned Parenthood applauded the charges saying it sent a message that there are consequences for targeting women and health care providers.

ROMANS: All right. The president with a candid assessment on the situation in Iraq about how we're fighting better than ever before, and that's getting a lot of reaction this morning. We're live in Iraq, next.



[04:42:02] TRUMP: Just had a call, long call from General Mattis and John I know is very happy to know that, he knows very well than anybody we're doing very well in Iraq. Our soldiers are fighting and fighting like never before and the results are very, very good. So, I just wanted to let everyone know.


BRIGGS: That fighting like never before part a lot of American families taking issue with that. Rare public comments from the president on the fight against ISIS in Iraq.

Mr. Trump's upbeat assessment coming in the wake of an airstrike that killed over 100 civilians in western Mosul. The Iraqi military blames the U.S.-led coalition.

Listen to General Stephen Townsend, the top U.S. commander in Iraq, acknowledging the coalition likely did play a role in the tragedy while also pointing a finger at ISIS.


LT. GEN. STEPHEN TOWNSEND, COMMANDER OF COMBINED JOINT TASK FORCE, OPERATION INHERENT RESOLVE: If we didn't strike in that area, I'd be telling you right now, it's unlikely. But because we struck in that area, I think there's a fair chance that we did it. My initial assessment is that we probably had a role in these casualties. Now, here's what I don't know -- what I don't know is: were they gathered there by the enemy?


BRIGGS: General Townsend said the type of munitions used in the strike should not have collapsed the entire building where all those civilians perished.

Let's go live to Irbil, Iraq, and bring in CNN senior international correspondent Arwa Damon, who is just in Mosul.

Arwa, good morning to you.

The president said our troops fighting like never before in Iraq. What do you make of that characterization?

ARWA DAMON, CNN SENIOR INTERNATIONAL CORRESPONDENT: I would say the Iraqi troops fighting like never before in Iraq. After all, they are on the ground and on the front lines. But the role the U.S. is playing in terms of bringing in their various different enablers, of course, the airstrikes, various different assets that the U.S. is bringing have been very significant. The Iraqis themselves acknowledge that they couldn't do this on their own.

It's also worth noting, Dave, that the kind of fight that's transpiring in Mosul is unlike anything the U.S. military faced during its more than a decade long occupation of Iraq. It's arguably one of the toughest battlefields in modern history because not only your trying dislodge an enemy like ISIS that's incredibly sophisticated, complicated, that has absolutely no rules of engagements, that does take populations as human shields, that does hold civilians at gunpoint in their homes while using their room tops as fighting positions.

The Iraqis are trying to come up against that kind of an enemy in a city that had 1.2 million people in it prior to this operation beginning. That is why so many people were so concerned about houses going to unfold, so concerned about the civilian casualties. On one hand, it is the sad and ugly and real byproduct of warfare.

[04:50:05] It's a very complicated battlefield, though. And when you have that many civilians that you know are hiding in these residential homes, when you know that ISIS is using them as fighting positions that's when you need to be extra careful when it comes to calling in these airstrikes, which is why both the Iraqis and Americans right now are reassessing the situation.

BRIGGS: Indeed a tragic situation there. Thank you, Arwa. Appreciate it.

ROMANS: I got to say -- I mean, I really admire her for bringing that to us every day. Very difficult reporting she does there all the time. She does not over simplify it.

BRIGGS: No, no, she understands the complexity of it. And, look, this is not an easy path forward for the U.S. mission.

ROMANS: No, it hasn't been for 10 years.


ROMANS: All right. The Dow snapping an eight-day losing streak. But even better, I'm going to show you two strong economic signs at the highest level in years. CNN Money Stream is next.


[04:55:07] ROMANS: All right. Welcome back.

History unfolding at this very moment in the United Kingdom. The British Prime Minister Theresa May formally triggering Britain's exit from the European Union by signing a letter invoking Article 50. This is the beginning of the divorce proceedings essentially. That letter will be delivered to the European Council in Brussels this morning.

There's a new complication. Scotland may want to secede from the U.K. before the U.K. exits the E.U. Oh, yes.

CNN's Nic Robertson tracking all the dominos for us live from London.

This has been months and months in the making here and finally, it really is history. Talk to me a little bit about the Scotland wrinkle.

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Yes, a hugely historic day. Many days, months in the making in the discussion here. But, of course, the union with Europe has been in place for 44 years.

What Scotland and the first minister, Nicola Sturgeon, is complaining about and the reason that she wants an independence referendum, 62 percent of the people in Scotland voted to remain part of the European Union, the first minister of Scotland today tweeted that Theresa May was taking Britain off a cliff with no safe place to land. She said that the Scottish people didn't vote for this, their voice hasn't been heard.

Theresa May is answering back that squarely saying that she will be negotiating on behalf of everyone in Britain, north, south, east, west, whether you're from a city, from a village, whether you're rich or poor, that she says there's a brighter future and everyone needs to unite behind these negotiations.

But Scotland is just one of the issues that's going to beset Theresa May going forward. One of the issues she will face is the fact that the European Union wants to conduct these negotiations in a different way to how Britain does. Britain wants to talk about the exit, you know, the bills that have to be settled with the European Union, and about future trade agreements, at the same time European Union's position is no, you settle your account first, you do the divorce and then we talk about the future, how the trade relationships might be. Theresa May will be setting some of that out in parliament as that letter triggering Article 50 is delivered to the European Council president in Brussels in just a few hours time, Christine. ROMANS: Just fascinating, the journey of the past few years. It

wasn't long ago when Scotland was trying to decide whether to stay with U.K. and did and now, Brexit. It's just fascinating sort of the existential issues happening there. Thanks so much, Nic Robertson.

BRIGGS: And next dominos to fall as well, right?

The U.S. women's hockey team agreeing to a four-year labor deal with USA hockey. The number one ranked team vowed to sit out the world championship games if they did not receive fair pay. They asked for $68,000 annual salary as well as benefits like child care, maternity leave and disability insurance, similar to what the men's number four ranked team already gets. The financial terms of the deal were not released.

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

The Dow's losing streak is officially over. The Dow up 151 points. That's after being down eight days in a row. That was the longest losing streak since 2011.

So, what turned things around yesterday? Well, renewed hopes about a tax reform package. Having investors feeling better following the failure of health care. The health care bill they think passing a tax package will be easier than the flawed Obamacare replacements. Dave is giggling.

There's also two strong pieces of economic data that helped the positive move. Consumer confidence shot up in March to a 16-year high, consumer confidence, people feeling pretty good about current business conditions, as well as the labor market. People are starting to feel the recovering job prospects and their raises. People are getting raises.

Also, home prices jumping 5.9 percent at the start of the year. That's the highest level in more than two years. So, your home, your job, two very positive things there feeding into confidence.

Three hottest markets for housing, by the way, Seattle, Portland and Denver. Prices in those cities are at all time highs.

The positive sentiment extending to global markets overnight, futures here in the U.S. are rising as well. We're going to keep an eye on the stock market in London today. It's higher ahead of that moment of the official start of Brexit.

ROMANS: Wells Fargo, the bank here, making amends for the fake account scandal. It's paying out $110 million to settle a class action lawsuit brought by several customers. That's on top of the $185 million it paid in fines to the Consumer Protection Bureau last year. Wells Fargo said the settlement should clear up 11 other lawsuits. It will pay customers who had fraudulent accounts opening back to 2009.

Separately, a top banking regulator severely downgraded Wells Fargo community lender rating. It says the egregious nature of discriminatory and illegal credit practices at that bank need to improve. It marks the first time Wells Fargo did not score an outstanding label in the review.