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EARLY START

Fallout From Comey Firing; Trump Travel Ban; North Korea Warns U.S. After Missile Launch; Economic Impact Of Cyberattack; Global Markets Respond To Cyberattack. Aired 5-5:30a ET

Aired May 15, 2017 - 05:00   ET

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


[05:00:00] DAVE BRIGGS, CNN ANCHOR: Because America is within range of a missile strike.

CHRISTINE ROMANS, CNN ANCHOR: And companies and computer users worldwide bracing for fallout from a cyberattack that some are calling the biggest ever. What it means for you, who could be behind it, and what happens when you logon this morning.

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

BRIGGS: And I'm Dave Briggs. It is Monday, May 15th, 5:00 a.m. in the east. What you need to do to protect yourself from that virus in just a bit, but we begin with the critical moment in Donald Trump's presidency. Who will he nominate to be the next FBI director?

At least eight candidates interviewed this weekend at FBI headquarters by Attorney General Jeff Sessions and his number two at the Justice Department, Rod Rosenstein. A White House official says the president will get reports on the interviews and speak to leading candidates to make a final decision himself.

ROMANS: So, that could happen as early as this week, as shock turns to anger over the firing of James Comey. Listen to Former Director of National Intelligence James Clapper. He is fearful of a total breakdown of the federal government because of the actions of this president.

(BEGIN VIDEO CLIP)

JAMES CLAPPER, FORMER DIRECTOR OF NATIONAL INTELLIGENCE: I think in many ways our institutions are under assault, both externally, and that's the big news here is the Russian interference in our election system. And I think as well our institutions are under assault internally.

JAKE TAPPER, CNN ANCHOR: Internally from the president?

CLAPPER: Exactly.

TAPPER: Because he's firing the checks and balances?

CLAPPER: Well, I think the founding fathers in their genius created a system of three co-equal branches of government and a built-in system of checks and balances. And I feel as though that's under assault and is eroding.

(END VIDEO CLIP)

BRIGGS: Boy, is that an ominous warning. Democrats, though, threatening to block the nomination of a new FBI director unless a special prosecutor is named for the Russia investigation.

All this chaos taking the focus off of the president's first foreign trip since taking office. He departs Friday for Saudi Arabia, Israel, and the Vatican. He also meets today with the crown prince of Abu Dhabi and tomorrow with Turkey's president, Recep Erdogan.

ROMANS: All right, later today, a federal appeals court will hold a hearing in Seattle to decide whether to uphold the president's revised travel ban. The Ninth Circuit already put the first ban on hold. Will this time be any different?

Let's go live to Washington, D.C., and bring in CNN justice reporter, Laura Jarrett. Laura, what do you expect today?

LAURA JARRETT, CNN JUSTICE REPORTER: Hey there, Christine. So, for the second time in just a few months, the fate of the travel ban is back up for debate in the Ninth Circuit. In just a few hours with the Trump administration once again trying to get the president's executive order back on track.

But the main question the judges have to wrestle with this time around is whether they can look at Trump's campaign statements about Muslims to find that the executive order was motivated by some sort of discriminatory intent when the face of the order doesn't say anything about religion at all -- Christine.

ROMANS: Do we know yet which judges on the Ninth Circuit will be hearing this appeal and how that could affect the case?

JARRETT: Yes, today's panel is made up of three judges, all appointed by former President Bill Clinton. Only adding to the drama in this case, as you can imagine, given that the president hasn't shied away from voicing his displeasure with the Ninth Circuit, calling last month to break up the court and other courts that have ruled against him in the past. He has had some strong words for them on Twitter.

ROMANS: All right, Laura, nice to see you this morning bright and early on a Monday morning, where it's still dark in the nation's capital. Thank you. Nice to see you.

JARRETT: Thanks, Christine.

BRIGGS: All right. Let's talk politics now and bring in CNN political reporter, Eugene Scott. And a lot to get to here this morning, my friend, as we start a brand-new week.

Good to have you. Let me start with an interesting report from someone called Axios, the reports of a staff shake-up that could be possible at the White House. That would include Reince Priebus, Steve Bannon, Sean Spicer. Who does Donald Trump blame for the miscommunication, if you will, the rollout of some of these things the past couple of weeks, and who do you think is most likely to be the casualty of that?

EUGENE SCOTT, CNN POLITICS REPORTER: That's pretty interesting. It's not clear who he would blame. It is clear that he perhaps should blame himself. He has admitted that --

BRIGGS: That ain't happening. So, who does he blame?

SCOTT: Well, his communications team he would expect to keep up with him, but he has admitted himself that it's hard to keep up with him and his stream of consciousness because it moves so quickly.

It will be interesting to see what he can do to help them better understand how quickly he is moving and what he's thinking about, even, I guess, at 5:30 sometimes when he's tweeting things and they don't even know yet what he said until they see it sometimes on air.

BRIGGS: So, Sean Spicer, is that who is in trouble here do you think?

SCOTT: Well, we don't know. The reality is we've seen more of Sarah this past week and some of the criticism that has hit the communications team has actually hit her.

ROMANS: Right.

SCOTT: We do know that Sean Spicer has been on the receiving end of a lot of criticism, but it will be interesting so see what happens.

ROMANS: It could just be venting. And that's clear with the Axios report too.

[05:05:03]I mean, the president could just be venting, and this is, you know, talking to his friends, talking to his allies, and venting that his team can't keep up with him because he is unpredictable and almost impossible to keep up with, quite frankly.

SCOTT: Yes, he could be. I think what we saw this past week is that quite a few decisions were made that would have involved, ideally, some strategic communications that just did not happen that would have made things a lot more beneficial, not just for the people receiving this information, but for the White House as a whole. I think some of the wounds we saw were definitely self-inflicted.

BRIGGS: All right, so, a lot of the questions as we begin this week are about tapes. Are there actual tapes? And the next battle is over the FBI director and who they appoint. And there were eight candidates interviewed over the weekend. We put up some of those earlier.

Here's what Lindsey Graham said, though, about who he thinks the president should not and who they would allow to get through.

(BEGIN VIDEO CLIP) SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: How about the idea of an FBI agent leading the FBI, promoting within the ranks? There are so many good agents, men and women, out there capable of leading the agency. This is up to the president. He has a duty and obligation to pick somebody beyond reproach outside the political lane.

(END VIDEO CLIP)

BRIGGS: Outside the political lane. Here are the people we've reported that have been interviewed for the job. Obviously, Mike Rogers, not outside the political lane, but people love him from the FBI association. John Cornyn, though, is who many would like for this job, and Lindsey Graham said, no. He's a great man, well respected, very successful, but not in this environment. How politicized will this nomination get over the next five, six days?

SCOTT: Very. I mean, it's significantly so, considering everything that happened. If it's true that Donald Trump made the decision because he wants the Russian investigation to end, and he himself admitted that he asked Comey to make a pledge of loyalty.

It's fair to assume that he's going to ask this next person to make a pledge of loyalty. And the question that arises from all of that is how does that affect people outside the White House? Will this person be more loyal to the president than the American people?

And now, also to the senator's point, I think it's wise to want someone who has experience with the FBI. Why bring someone into this situation who will have a huge learning curve?

BRIGGS: Sure.

SCOTT: Some of those people on there have no experience with FBI.

ROMANS: It's so fascinating. The "Washington Post" has a piece this morning, the headline "Trump tumult benefits Moscow." And Donald Trump trying to put the Moscow issue behind him, but it is still the number one thing on his plate here. And it threatens to overshadow his foreign trip later this week, I think.

SCOTT: Absolutely. And I mean, we've seen from polls that voters are still very concerned. The majority of voters would like to see a special prosecutor in this situation because they do think something may have happened and that if there is not an independent investigation, we may never get to the bottom of this.

And the reason why this is of concern is because people have repeatedly said that Russia's involvement in the election didn't start with this election and it's not going to end with this election.

ROMANS: Right.

BRIGGS: Of course, it depends on your party affiliation because Republicans are not concerned about Russia. Democrats are very concerned. A wide divide, as usual. See you in about 30 minutes. Eugene Scott, thank you. All right, North Korea says the U.S. is in range of a missile strike. We are live in Seoul with why Pyongyang's latest missile test is more cause for concern than usual.

(COMMERCIAL BREAK)

[05:12:31]

BRIGGS: Growing concerns over North Korea's rapidly developing nuclear program after a successful ballistic missile test over weekend. The Kim Jong-Un regime now claims it is capable of striking mainland United States. Pyongyang also warns this latest missile test proves it has growing capacity to launch even bigger nuclear weapons.

CNN's Alexandra Field live for us in Seoul with the latest. Good morning to you, Alex. This is the tenth missile launch you've reported since Trump took office. How does this one differ?

ALEXANDRA FIELD, CNN INTERNATIONAL CORRESPONDENT: Well, look, analysts even in the U.S. are saying that the level of performance of this missile is the highest level of performance that they have seen from a North Korean ballistic missile.

And the fact that they're able to launch this successfully is being considered significant, not just by the North Koreans, who are, of course, celebrating what they consider a victory, but by the international community. They are closely watching.

They quickly determined that this could be a new type of missile that was launched. It went higher and it went farther than previous ballistic missiles have recently gone, this one landing off of Russia, closer to Russia, that is, than to Japan.

And now analysts who are closely monitoring the trajectory of that missile are saying that this could represent a significant step toward the development of an intercontinental ballistic missile.

That is, of course, the goal of the North Korean regime, to develop an intercontinental ballistic missile capable of carrying a nuclear warhead all the way to the U.S.

Officials in the U.S. are saying that it is very clear that this was not the launch of an ICBM, there is no indication that this launch was consistent with what an ICBM would look like, but North Korea certainly touting its success, given the height of the projectile in this case and the distance that it traveled -- Dave.

BRIGGS: All right, so, we've seen the Trump administration vary wildly when it comes to North Korean missile launches, but this is the first test for the new South Korean president. How are both responding to the latest launch?

FIELD: Yes, President Moon Jae-in elected to office less than a week ago here in South Korea and confronted with this test within just a matter of days, certainly, a test, though, that he was preparing for, as you have seen this barrage of missile tests coming from North Korea.

This is a president who has advocated a return to a policy of greater engagement with North Korea. In the aftermath of this ballistic missile launch, he has, of course, condemned these actions, said that South Korea needs to respond from provocations from North Korea.

But has also said the South needs to make it clear to North Korea that there is still the possibility of talks, if North Korea can change its attitude.

As for the White House, as for Washington, you have heard some back and forth from officials in Washington over the last few weeks and months.

[05:15:05]They have wavered between suggesting that there is a military option that always remains on the table and also now suggesting that the possibility of more dialogue, more talks are on the table.

But what they went for in terms of the response after this ballistic missile launch was to call on other countries in the region to strictly enforce sanctions against North Korea, something you have heard them certainly call for before.

The White House also putting out a statement saying that the president imagines that Russia can't be too pleased with this launch -- Dave.

BRIGGS: Hoping to get them off the sidelines, indeed. Alexandra Field live for us in Seoul, 6:15 p.m. there. Thank you, Alex.

ROMANS: All right, it is being called one of the biggest cyberattacks ever. It is rolling out right now. Today is pivotal as you logon. We'll tell you what you need to know.

(COMMERCIAL BREAK)

[05:20:14]

ROMANS: All right, just about anybody with a computer is worried this morning as they logon. Companies around the world bracing for more fallout from the biggest cyberattack ever. The 200,000 users in 150 countries were hit by attacks that started late Friday and law enforcement warns there will be more victims this morning as the workweek begins.

Already attacks being reported overnight in China, Japan and South Korea as the Monday morning got under way in those countries. The virus locks users out of their computers and then demands hundreds of dollars to give you back control.

Global companies like FedEx and Nissan, as well as hospitals, universities and even some government agencies have been hit by the so-called "Ransomware." The software targets a flaw in Microsoft Windows, and now Microsoft has released a security patch.

It did back in March, but the virus hit networks that had not updated their systems with that patch, which Microsoft stressed the importance of in statements Sunday, also said this attack is a wake-up call for governments, kind of a remarkable warning from Microsoft to governments, NSA in particular where this came from.

BRIGGS: All right, let's get more on the global impact of this cyberattack. What could be in store today? CNN business and technology correspondent, Samuel Burke live in London.

ROMANS: Good morning, Samuel.

BRIGGS: Good to have you, my friend. So we report there 150 countries. We know there are new cases today. Any yet in the United States and how do our viewers protect themselves this morning?

SAMUEL BURKE, CNN MONEY TECHNOLOGY CORRESPONDENT: Good morning, Dave. Good morning, Christine. The claws of this ransomware are still sinking in. If we want to get a preview of what's going to be happening in the United States, let's go to China, where they've already had their Monday morning 40,000 infections there.

Remember, this news broke on Friday. Folks were already at home there. Now they're going back to the offices and seeing that their computers were infected over the weekend and they're having to pay up.

Plus, there are new strains of this virus. It could be the same group altered their code because their virus had been stopped from spreading, or maybe new copycat groups have popped up and seen that they can make a lot of money off of this.

Plus, U.K. government holding emergency meetings here. Remember, technology actually affected lives here in the U.K. You had out- patient appointments canceled at the U.K. hospitals.

But I think what's most flummoxing about all of this is really the fact that Microsoft is willing to point their finger directly at the government. Usually they say, well, one of the governments, there are all these pleasantries between companies, and especially the U.S. government.

But take a look how specifically Microsoft called out the NSA and the U.S. government in this blog post. They say something very clearly, quote, "Repeatedly exploits in the hands of governments have leaked into the public domain and caused widespread damage.

An equivalent scenario with conventional weapons would be the U.S. military having some of its Tomahawk missiles stolen." So, we've heard the tech companies complaining about back doors the government wants or develops, and then they get into the hands of the bad guys, and this is what happens.

ROMANS: And so, specifically, what Microsoft is alleging that the NSA did here is the NSA found this vulnerability, right, in Microsoft --

BURKE: Right.

ROMANS: -- and then hackers found the information from the NSA and released it to everyone, and then Microsoft had to patch that hole, but now it's out there.

BURKE: You've got it. The one thing we're not clear about is whether this information was stolen from the NSA or if somebody leaked it from the NSA. Remember, you have people like Edward Snowden, the former NSA contractor.

But just to be clear, this is a hole in Microsoft, basically, that they tried to patch back in March. But what happens is the only way for you to get that patch is to do that little annoying update in the lower right-hand corner that says, restart Windows right now and you'll get the update.

So, of course, if you guys are about to go on air, you don't have time to do that, you say tomorrow, and suddenly, March turns into May, you haven't been updating, and then you could fall victim to this.

So, if you're watching, thinking what can I do, just make sure Windows is updated, that's it, and you will be safe 100 percent from this ransomware.

BRIGGS: It's a pretty simple fix but easy to ignore. Are people simply paying up the $300 in Bitcoin currency?

BURKE: This is what's so surprising is that people are paying because this group of cyber criminals are getting a good reputation. What happens here is these criminals want to get a good reputation so that people know, if you come to us and you pay us the 300 bucks, you'll actually get your data back.

So, sometimes this ransomware, they have chat support online so you can talk to a customer service agent. You can even call them sometimes, again, so they can build up this good reputation so that they can get more and more money.

Of course, we don't know who this is, but experts are ruling out a government like Russia or China, because China and Russia are some of the prime people being attacked here. So, it's people who are after money in all likelihood.

[05:25:02]ROMANS: All right, thanks so much, Samuel Burke. Nice to see you this morning from London. Thank you, sir.

The former National Intelligence chief expressing major concerns about President Trump.

(BEGIN VIDEO CLIP)

CLAPPER: Our institutions are under assault internally.

TAPPER: Internally from the president?

CLAPPER: Exactly.

(END VIDEO CLIP)

ROMANS: Can President Trump get back to business with Washington still reeling from James Comey's firing?

(COMMERCIAL BREAK)

BRIGGS: With vetting under way for a new FBI director, President Trump looking to escape the shadow of James Comey, but top Democrats won't let the firing go and say they may stonewall confirmation of Comey's replacement.

ROMANS: North Korea escalating its threat against the United States and claiming its newest ballistic missile can carry a bigger nuclear weapon.

BRIGGS: And one of the biggest cyberattacks of all time striking again today. How companies worldwide are bracing for more fallout, who could be behind it? Forty thousand new cases today of this virus. It is terrifying. What you can do to protect yourself in a bit.

Welcome to EARLY START. I'm Dave Briggs.

ROMANS: And I'm Christine Romans. It's 30 minutes past the hour this Monday morning.