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EARLY START

Trump Says Armed Conflict with North Korea Possible; No Health Care Reform on Trump's 100 Days; President Trump's Foreign Policy Challenges. Aired 4-4:30a ET

Aired April 28, 2017 - 04:00   ET

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


[04:00:09] DAVE BRIGGS, CNN ANCHOR: The most direct warning to date about North Korea. Direct from the commander-in-chief himself. It comes in the same interview where he revealed being president is harder than he expected.

CHRISTINE ROMANS, CNN ANCHOR: And a new investigation into Michael Flynn's expecting payments from Russia and Turkey. But when it comes to his security clearance why is the White House shifting blame now to the Obama administration?

Good morning and welcome to EARLY START. I'm Christine Romans this Friday morning.

BRIGGS: And I'm Dave Briggs.

ROMANS: Friday morning, Friday morning.

BRIGGS: It is Friday morning. We're very happy about that. Aren't we?

You know, being president is harder than everyone expected. I know he's taking a lot of grief for admitting that. But has there ever been a president that admitted, yes, this is about what I figured?

(LAUGHTER)

BRIGGS: I'm pretty sure there's not. It is day 99 of the Trump administration, 4:00 a.m. in the East. And we have breaking news.

Overnight an urging warning from President Trump on North Korea nuclear and missile development programs. The president suggesting a military face-off with Pyongyang is within the realm of possibility.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Well, there's a -- there's a chance that we could end up having a major, major conflict with North Korea. Absolutely.

(END VIDEO CLIP)

BRIGGS: The president telling Reuters the U.S. would prefer to achieving nonnuclear North Korea through diplomacy but he said that's very difficult. ROMANS: In the interview, the president praised Chinese President Xi

for trying very hard, quote, "trying very hard," to resolve the crisis. You might recall previously he's criticized Xi for not doing enough and said that China wasn't doing enough. In fact, Secretary of State Rex Tillerson says China threatened sanctions against North Korea if it attempted another nuclear test.

Tillerson is set to chair a U.N. Security Council meeting on North Korea later this morning, with the House of Representatives set to vote on new sanctions against Pyongyang next week.

For the very latest, let's bring in CNN's Alexandra Field live in Seoul for us this morning.

Good morning, again, another news cycle full of twists and turns on the North Korean story. How is it playing there?

ALEXANDRA FIELD, CNN INTERNATIONAL CORRESPONDENT: Yes, twists and turning exactly. Because just as it seemed that the tone was almost perhaps softening from Washington, D.C., we'd heard the Secretary of State Rex Tillerson leaving the door open for possible talk with North Korea given the right agenda, you'd heard not just the secretary of State but also of the secretary of Defense, talking about how the preferred method here would be dealing with economic sanctions and diplomatic measures.

Now you have these incredibly powerful words from President Donald Trump warning of a possibility of a major, major conflict. Though then saying he would prefer to handle it diplomatically. And also against speaking about Chinese President Xi Jinping and saying that while he believes that President Xi wants to do something about the situation, perhaps he can't.

Now you've got Chinese officials from the Ministry of Foreign Affairs warning that the situation could spiral out of control. China and Russia both continue to call for more openness, more conversation with North Korea. Again the secretary of Defense from the U.S. also leaving the door open for the possibility of more communication given what he described again as the right kind of agenda was a change of position from what he'd heard earlier from other Trump administration officials.

But at the same time you have the U.S. still working to build up its defenses here, which have raised anger within the region from neighboring countries and North Korea. You've got this bad missile defense system that is being installed.

Now President Trump is saying that the billion dollar system is something that South Korea should for. It's being installed in South Korea. He says it's for their protection. That's not South Korea's understanding of the deal here. They say that they're the ones who provide the site and the infrastructure, that it is the U.S. that pays to operate this system, this billion-dollar system, as President Trump points out. That's from South Koreans have left at this point a bit of confusion then on what exactly President Trump means when he says that they should be paying for it. ROMANS: Wow.

FIELD: So that's where we leave it here right now, Christine.

ROMANS: When clearly that was an American priority to blunt influence of other countries in the region and to keep, you know, America's foot in the region in terms of policy. Unbelievable.

OK, great. Thanks for that, Alexander. Yes. Go ahead. Go ahead.

FIELD: Yes. It's a system that they have been rushing to put into place. They said it's going to be operational in just a matter of days over and over again. You have heard U.S. officials here saying that this is critical because of the advanced threat from North Korea. And they've also said repeatedly that this is not just about ensuring security and safety in the region, but that it will help to protect the U.S.'s national security interests. That's why they've said it's so important despite the fact that it's actually a system that has raised some concerns among South Koreans. It's controversial here as well as being objected to by both Russia and China.

ROMANS: Right. Exactly. All right, thanks so much, Alexandra Field, for that.

BRIGGS: A lot to unpack indeed.

[04:05:02] New trouble this morning for National Security adviser -- former National Security adviser Michael Flynn over his decision to accept payments from Turkey and Russia after he retired from the military.

We have new information that the Pentagon inspector general has opened an investigation into the retired army general and that the Defense Intelligence Agency actually warned Flynn back in 2014 against accepting foreign payments.

That is according to documents obtained by the House Oversight Committee, some of which were released by Ranking Democratic Elijah Cummings.

ROMANS: He says these documents raised, quote, "grave questions" about why Flynn concealed the payments after he was warned explicitly by the Pentagon. And Cummings took the administration to task.

(BEGIN VIDEO CLIP)

REP. ELIJAH CUMMINGS (D), RANKING MEMBER, HOUSE OVERSIGHT COMMITTEE: I honestly do not understand why the White House is covering up for Michael Flynn. I don't get it. After the president fired him. For lying.

(END VIDEO CLIP)

ROMANS: The Republican chairman of the Oversight Committee, Jason Chaffetz, is not happy with Cummings. His spokesman said the Democrat broke with long-standing protocol, releasing those documents without consulting Republicans.

BRIGGS: Asked about all of this Press Secretary Sean Spicer says he thinks it's, quote, "appropriate" for the Pentagon to look into Flynn if they think there is wrongdoing. But questioned by our Jim Acosta why Flynn wasn't more thoroughly vetted, Spicer pinned that on the Obama administration.

(BEGIN VIDEO CLIP)

SEAN SPICER, WHITE HOUSE PRESS SECRETARY: He was issued a security clearance under the Obama administration in the spring of 2016. The trip and transactions that you're referring to occurred in December of 2015. All of that clearance was made by the Obama -- during the Obama administration and apparently with knowledge of the trip that he took.

(END VIDEO CLIP)

ROMANS: One source familiar with the case admits Flynn did make a mistake, failing to fill out the proper forms seeking permission to get paid by Russian state TV channel for a 2015 trip to Moscow. But the source strongly denies any effort to conceal that payment. He says Flynn briefed the Defense Intelligence Agency before and after that trip.

BRIGGS: President Trump offering new insight into why he decided to renegotiate NAFTA rather than pull out of the agreement like he promised. The president telling "The Washington Post" he was prepared to announce a full withdrawal from the trade agreement tomorrow, the 100th day of his administration. Quote, "I was all set to terminate," Mr. Trump tells the "Post," adding, "I looked forward to terminating. I was going to do it."

So what changed, Christine?

ROMANS: It turns out the president's staff was deeply divided. The news of a possible U.S. withdrawal was rattling markets in Canada and Mexico. And Cabinet officials showed the President a map highlighting regions of the country which would be hardest hit by a NAFTA pullout. Most of them were in pro-Trump territory.

The president yesterday claimed his administration is already beginning to renegotiate NAFTA but that's actually possible. The president must first provide notice of his intent to re-work the agreement, kicking off a 90-day consultation period with Congress and industry group were now told that process will begin next week.

But I'll tell you, a lot of folks are saying you can see the Goldman Sachs faction at play in this White House, not getting NAFTA, not attaching the border wall to funding the government. All of these things one after another, tax cuts, big tax cuts for big companies is why Wall Street -- a guy who won on championing the little guy.

BRIGGS: Yes.

ROMANS: The working class. But the investor class is very happy with this president and his team today. BRIGGS: Well, ironically it's the economic reality of these things

that he didn't realize. You would think that was the one thing that he'd know because he was a businessman and championed himself as that.

ROMANS: Right.

BRIGGS: But that's what he's been woken up to is what it means to get out of NAFTA.

A lot in store for President Trump on day 99 of his presidency. He is expected to sign an executive order his administration hopes will pave the way for offshore drilling. Mr. Trump will then travel to Atlanta with Vice President Mike Pence to speak at the annual NRA Leadership Forum. This as Mr. Trump shares some interesting thoughts about his time as president ahead of his 100th day mark.

(BEGIN VIDEO CLIP)

TRUMP: Well, I loved my previous life. I loved my previous life. I had so many things going. I -- actually this is more work than in my previous life. I thought it would be easier. I thought it was more of a -- I'm a details oriented person, I think you would say that. But I do miss my old life. This -- I like to work, so that's not a problem. But this is actually more work.

(END VIDEO CLIP)

ROMANS: One of President Trump's biggest campaign promises will remain unkept as he reaches 100 days in office. House Majority Leader Kevin McCarthy announcing there will be no vote on health care reform this week. Translation, Republicans -- translation, rather, Republicans don't have the votes. New concessions to conservatives resulting in too many moderates jumping ship, Dave.

BRIGGS: Well, the threat of a government shutdown is off the table for now, it appears. Short-term stop gap spending bill expected to pass. Democrats threatened not to support it if a vote on health care had taken place.

We get more now from CNN's Phil Mattingly.

[04:10:05] PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT: You know, Christine and Dave, despite a furious last minute, last few hour lobbying effort trying to get the requisite number of votes to get health care repeal and replace to the House floor and pass it, Republicans have fallen short.

Now on some level that's good news in the sense that the Democratic threat to hold up the House spending bill with the deadline of the government shutdown tonight is now officially off the table. They will pass a short-term continuing resolution to make sure that the government stays open. But on a broader sense healthcare is now in very, very dire straits again. That even after this optimism from the speaker earlier on Thursday.

(BEGIN VIDEO CLIP) REP. PAUL RYAN (R), HOUSE SPEAKER: I think we're making very good progress. We don't have -- we're going to go when we have the votes. But that's the decision we'll make when we have it and something tells me you'll probably be the first to know when that happens. I would argue that this is a bill that a moderate would more likely want to support.

(END VIDEO CLIP)

MATTINGLY: Now the question is what happens next. Obviously House leaders meeting trying to figure out a pathway forward, their members going home trying to figure out what actually happens next. There's no question this was as close they've gotten to actually getting across the finish line on the bill. The real question is, can they resurrect it? They put a major, major effort in at the White House request towards the end, now on the government funding side of things, while they were having a short-term deal, there are still negotiations going on behind the scenes for a longer term deal.

According to Republicans and Democrats in both chambers I'm speaking to, they feel very confident they will get there. There will be no shutdown neither in the near term or in the longer term. So some positive news there. But when it comes to healthcare at the moment it looks like once again Republicans have fallen short -- Christine and Dave.

ROMANS: All right. Phil Mattingly, thanks for that.

You know, the president has promised 3 percent, 4 percent even, maybe even more growth. He says his policies will get that. We're going to get a real economic snapshot today to see how we're doing the president's first 100 days, the first GDP report comes in just a few hours. We'll tell you what to expect.

(COMMERCIAL BREAK)

[04:16:02] ROMANS: On the eve of 100 days, the government publishes the Trump administration's first economic report card. The president promises his policies will boost growth to 4 percent. If predictions hold true, he's off to a slow start here. The first read of economic growth for 2017 is due out this morning. First quarter GDP is what it's called. It's expected to show the economy growing at a 1 percent annual rate. Some economists are predicting even lower numbers. Last January was also weak.

We can't blame Trump's policies just yet. Consumer spending has been dropping in recent months and that drives about two-thirds of the U.S. economy. If the Trump administration could push through tax cuts or an infrastructure bill soon, that likely won't have an impact until next year, and that's a big if on passing.

Today's number shows Trump's uphill battle to 4 percent. The U.S. economy has had an average 2 percent growth since the last recession. The last time we saw 4 percent growth, Bill Clinton was in the White House and the economy was surging around the dot-com boom. But even with slow growth, there are still plenty of reasons to be

optimistic about the economy. Overall, the U.S. economy is in good shape. Solid job growth, stocks at record highs, home sales records are strong just to name a few. We'll know the exact GDP numbers when I break them live at 8:30 a.m. on "NEW DAY."

BRIGGS: The path forward for the U.S. on the landmark Paris climate accord is cloudy after a meeting of the president's key advisers. Sources tell CNN they're leaning against pulling out of the Paris agreement but renegotiating the deal Paris is something Energy Secretary Rick Perry has recommended. The 2015 Paris Accord aims to limit global carbon emissions. The deadline for the Trump administration to decide is the G-7 meetings at the end of May.

ROMANS: All right, United Airlines hoping to finally but the dragged passenger debacle behind it. The airline reaching a settlement with the passenger Dr. David Dao. Terms of the settlement not disclosed. Of course he was forcibly removed from the sold-out flight last month by airport police to free up a seat for a United crew member. The videotaped incident sparked global outrage and became a PR nightmare for United. And as for the settlement, Dao's lawyers praised United CEO's Oscar Munoz for saying he would do the right thing and doing it.

The company also yesterday, David, as you know, saying it would pay up to $10,000 if you had to lose your seat once you're in that seat.

BRIGGS: But you'll never hear that. The reward being offered. Let's be clear.

ROMANS: You won't be pulled off the seat once you're already seated on the plane. And also for lost bags, no question asked, $1500 minimum.

BRIGGS: Minimum. Yes. You can get more if you can show --

ROMANS: Yes.

BRIGGS: And 60 minutes prior to a flight, crew have to be booked. That would have gotten them out of that whole debacle.

Meanwhile, a big primetime welcome to the NFL. The first round of the 2017 NFL draft now in the books. Cleveland Browns taking Texas A&M defensive end Myles Garrett with the top pick. The Bears trading up one spot to grab North Carolina quarterback Mitchell Trubisky with the second overall pick. The festivities this year, outside Philadelphia, where Commissioner Roger Goodell got his welcome. Listen.

(BEGIN VIDEO CLIP)

ROGER GOODELL, NFL COMMISSIONER: Good evening, and welcome to the NFL draft. Come on, Philly. Come on. There you go.

(END VIDEO CLIP)

BRIGGS: Philadelphia rules.

ROMANS: Brother love.

BRIGGS: Philadelphia rules. They crushed Goodell. Round two and three of the draft held tonight. The final four rounds tomorrow. Philly fans are unlike any other, Christine.

ROMANS: All right, way to go.

All right. No shortage of global challenges in the 100 days for President Trump. How's he handling them? What lies ahead? We have results of a CNN poll and we have analysis live from London.

(COMMERCIAL BREAK)

[04:24:05] ROMANS: President Trump facing a number of foreign policy challenges during his first 100 days in office. Chief among them Syria and Russia. A new CNN poll shows increasing anxiety among Americans about that crisis in Syria. 51 percent say they're very concerned, another 38 percent somewhat concerned. Look at that, only 10 percent are not concerned about the situation with Syria. Compare that to a 2013 CNN police where only 36 percent of Americans were very concerned, very concerned about Syria.

BRIGGS: Turning to Russia, nearly 3 out of 4 Americans now believe it is at least somewhat likely that improper contacts took place between the Trump campaign and the Kremlin.

For more on the global challenges facing Mr. Trump moving forward, let's bring on CNN's Nic Robertson live from London.

Great to have you on, Nic. It is a dizzying pace trying to keep up or surmise a foreign policy, look gradient let alone. What do you make of the last few days alone in terms of a strategy for the Trump administration?

[04:25:06] NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: You know, there's clearly an effort to squeeze in some successes. And you have to sort of, if you will, kind of back up a little bit and analyze the last couple of days through the eyes of what we've seen over the last 100 days. You know, he came to office in the eyes of the international community, untested, unknown and very unnerving, you know, being essentially opposed to European Union, opposed to NATO, collapsing the Pacific trade deal, 12-nation trade deal, the travel ban. All of these things, the international community found very, very disconcerting.

Now he's changed his position a bit on NATO. It's not obsolete, he says. He's warmed towards the European Union. He will be hosting the Australian prime minister in the next few days after hanging up on the phone with him in the first few days of office. So when you look at it through that prism, you know, the international community is a little -- feels perhaps, you know, a little more at ease because here's somebody who's perhaps learned a few things on the job. The chemical strike -- against Assad's regime or Assad's chemical use and the following strike really put a rift between President Trump and President Putin, and that was something international allies were concerned about, the warmth of that relationship. So, you know, when you look at what's happened in the last couple of

days vis-a-vis North Korea, you're still in a position, the international community is still in a position where they see Trump as someone who's sort of learning on the job if you will but still unpredictable. They still don't know which way he's going to go.

So if they began feeling a little bit unnerved about him coming to office, I think there's a still strong sense of unease. This is a president who still has a lot of global diplomacy to learn. Not least you could look at that exchange with Angela Merkel when she visited the White House. So there's this unease that remains about where he still has to go.

BRIGGS: Nic Robertson live for us. There's one thing that's clear, so much for America first. Thank you, Nic.

Christine, it's hard to figure out. Right? It's great to hear from Nic on what world leaders think. We know this. He's leading with foreign policy, trying to put some points on the board. It is certainly not the America first we expected.

ROMANS: No, it is not. It is not. There's a lot we haven't expected, and it may change again. It may change it.

An ominous warning from President Trump on that subject. He is now on the record that the United States could be headed for a major military conflict with North Korea. And his musings about the personality and the challenges of Kim Jong-un catching a lot of attention overnight. Details next.

(COMMERCIAL BREAK)