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EARLY START

White House Faces Fallout from Don Jr. Meeting; Congress Reacts to Trump Jr. Emails; Trump Jr. Emails Trigger Stock Drop. Aired 4:30- 5a ET

Aired July 12, 2017 - 04:30   ET

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


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[04:30:11] DONALD TRUMP, JR., PRESIDENT DONALD TRUMP'S SON: In retrospect, I probably would have done things differently.

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CHRISTINE ROMANS, CNN ANCHOR: Perhaps a bit of an understatement from Donald Trump Jr. after releasing e-mails critics say prove collusion with the Russians. Now, chaos was again consuming the White House over the issue that just won't go away.

More of EARLY START's coverage right now.

Welcome back to EARLY START. I'm Christine Romans.

DAVE BRIGGS, CNN ANCHOR: I'm Dave Briggs.

Keystone Kops collusion, that's what "The Wall Street Journal" is calling all of this.

This morning. though, an already fractious White House in escalating chaos coping with the fallout from Donald Trump Jr.'s meeting with a Russian lawyer and his release of the e-mail setting it up. "The New York Times", out front on all of this, reporting, says the president's aides and lawyers have formed what the paper calls a circular firing squad, slamming each other for the decisions based on Don Jr.'s meeting with the Russian came to light. The younger Trump's own e- mails ahead of the meeting provided the most direct evidence he was willing, even eager to accept help from a foreign adversary.

ROMANS: An email from publicist and Trump associate Bob Goldstone made the pitch. Quote: Very high level and sensitive information, part of Russia and its government's support for Mr. Trump. Don Jr.'s response: if it's what you say, I love it, especially later in the summer.

Now, he's speaking out on his own defense, telling FOX News: in retrospect, he would have done things a little differently.

(BEGIN VIDEO CLIP) TRUMP JR.: And this is 13 months ago, before I think the rest of the world was talking about that, trying to build up this narrative about Russia. So I don't even think my sirens went up or the antennas went up at this time because it wasn't the issue that's been made to be over the last, you know, nine months, 10 months.

SEAN HANNITY, FOX NEWS HOST: Do you tell your father anything about this?

TRUMP JR: No, it was such a nothing. There was nothing to tell. I mean, I wouldn't have even remembered it until you start scouring through the stuff. It was literally just a wasted 20 minutes, which was a shame.

(END VIDEO CLIP)

BRIGGS: So far, Don Jr. has not spoken to the FBI nor handed over documents, but his lawyer says he's willing to talk to any investigators. Last night, new reporting from "The Times" that the president signed off on Don Jr.'s initial statement crafted by Trump advisors late Saturday, a statement that made no reference to the meeting being about this damaging information on Hillary Clinton.

"The Times" also reported the president is frustrated with his attorney Marc Kasowitz, while Kasowitz and his team are frustrated with what they see as meddling by Trump's son-in-law Jared Kushner -- all of the intrigue. A lawyer for the president denies all this reporting.

ROMANS: The president himself preparing to head back to Europe later today, posting a new tweet of support for his son. He is a great person who loves our country. That's a notably stronger endorsement of Don Jr. than the one earlier in the day that came from the White House, which is where we find CNN's Jim Acosta with the latest.

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[04:35:09] JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: Christine and Dave, the White House didn't offer a very forceful defense of Donald Trump Jr., the deputy press secretary read a brief statement from the president off camera to say that he believes his son is handling this e-mails transparently, despite the fact that Trump Jr. has changed his story about his meeting with a Russian lawyer.

Here's what happened when Sarah Huckabee Sanders was asked about this.

SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: I have a quick statement that I'll read from the president.

My son is a high quality person and I applaud his transparency and beyond that I'm going to have to refer everything on this matter to Don Jr.'s counsel and outside counsel and won't have anything else to add beyond that.

ACOSTA: Sanders also responded to a question about whether members of the president's team could also be brought up on charges of perjury or even treason. She said that would be, quote, ridiculous -- Christine and Dave.

(END VIDEOTAPE)

BRIGGS: Jim Acosta, thank you.

The e-mail stated it clearly: the Russian lawyer who met with Donald Trump Jr. last summer was acting on behalf of the Russian government in its effort to hurt Hillary Clinton and help Trump. But attorney Natalia Veselnitskaya denies having any links to the Kremlin and her account of that 2016 meeting differs on some points from what the president's son has been saying.

CNN's Matthew Chance had a chance to speak with that attorney. He joins us live from Moscow with the latest episode of "House of Cards" playing out in real life.

Good morning, Matthew. What did she tell you?

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, hi, Dave.

That's right. I mean, Natalia Veselnitskaya, first of all, says she has no compromised or had no compromising information that she could offer about Hillary Clinton to the Trump campaign, despite those e- mails showing that Donald Trump Jr. at least was very keen to receive that kind of sensitive information from her. What this lawyer says that she had this meeting in order to lobby for the lifting of the U.S. Magnitsky Act. Now, this is a bit of legislation designed to punish suspected Russian human rights abusers and corrupt officials.

She's also lobbying against, she says, the ban on adoptions by American families of Russian children, that was imposed by the Kremlin in retaliation from that Magnitsky Act.

Well, I catch up with Natalia Veselnitskaya just as those explosive e- mails became public. Take a listen to what she had to say.

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NATALIA VESELNITSKAYA, RUSSIAN LAWYER WHO MET WITH DONALD TRUMP JR. (through translator): When it was suggested that I meet with Donald Trump Jr., I met him in a private situation. It was a private meeting, not related at all to the fact that he was the son of the candidate.

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CHANCE: Well, Veselnitskaya, of course, denying again that she had that compromising information. She also denied that she was sent by the Kremlin as part of this campaign to meddle in the U.S. election. The Kremlin for that part say they've never even heard of Natalia Veselnitskaya.

BRIGGS: As to that meddling in the election though, Matthew, does it get us any closer to establishing how and if Russia meddled in the U.S. election?

CHANCE: Well, I think it certainly pours fuel on that speculation. It doesn't do much to dash any speculation that Russia meddled in the U.S. election, but it's not a smoking gun. I mean, the Kremlin, as I say, have denied this, and when we speak to them later today, I expect there will be further denials.

But what it does show, of course, and we've been reporting this widely, is there was a willingness on part of the Trump campaign team to take a meeting with somebody they believed to be from Russia, a Russian government lawyer with that kind of sensitive information, and that's the real issue here.

ROMANS: Matthew, Christine here. It's fascinating when you listen to that translation of the attorney there. She said when it was suggested I have a meeting with Donald Trump Jr., I'm still really confused how this went from a pop star, his oligarch father, a publicist, an attorney and how they even know each other, this attorney and the pop star and the publicist and Donald Trump Jr. It's still to me, I don't know where the genesis of this meeting comes from.

CHANCE: You know, if you want to meet with -- perhaps if you're in Russia and you want to meet with the Trump campaign team, you look at their public business contacts that the Trump family had and the most important and most prominent family contact, business contact that Trump had in Russia was when he staged the 2013 Miss Universe contest here. He did that in partnership with someone called Aras Agalarov. He's a Russian billionaire, property developer. They sometimes call him the Russian Trump, in fact.

Well, his son Emin Agalarov is that sort of pop star originally from Azerbaijan, he sold a million records, I might add, not very widely known outside of the former Soviet Union. But he's in connection with this lawyer. She's done work with the Azeri business community here in the past. She obviously accessed him as a way to get through to the Trump administration or the Trump campaign team as it was then.

[04:40:05] And it's not clear where this idea that she had compromising information came from. Did she make it up as a way of accessing, of getting through the door to have that meeting with Donald Trump Jr., or is it real? That's something that we still haven't got to grips with yet.

BRIGGS: Right. Or was the Russian government just testing out --

ROMANS: Probing, right.

BRIGGS: -- the campaign to see if they were going to play ball.

All right. Matthew, thanks so much. We'll check with you in the next hour.

ROMANS: Joining us to discuss the latest, CNN law enforcement analyst, James Gagliano, a retired FBI supervisory special agent.

Good morning.

JAMES GAGLIANO, CNN LAW ENFORCEMENT ANALYST: Good morning.

ROMANS: You've heard from the attorney there who says she doesn't work for the Kremlin and when it was suggested that she meet with Donald Trump Jr. She did. Now, we heard from Donald Trump Jr. after a last summer in particular being very, very fierce and derogatory about anybody who was talking about, you know, about the campaign talking to the Russians.

Now, he's more chastened. Let's listen to him last night on FOX.

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TRUMP JR.: In retrospect, I probably would have done things a little differently. Again, this is before the Russian mania. This is before they were building it up in the press. For me, this was opposition research. They had something, you know, maybe concrete evidence to all the stories I'd been hearing about, but they were probably underreported for, you know, years, not just during the campaign. So, I think I wanted to hear it out, but really, it went nowhere and it was apparent that that wasn't what the meeting was actually about.

(END VIDEO CLIP)

ROMANS: What do you think is the best step for this, for Bob Mueller and his team who are now aware of this meeting in terms of the investigation?

GAGLIANO: Well, as you pointed out, Christine, I mean, Don Jr. was full throated in his, you know, rebuttals of folks that said there were any meetings with Russia or Russian agents.

I go to this. Pride goes before the fall, and if you look at the physical evidence that the Mueller prosecution team now has available, they have it on a document between the four corners. It's not somebody recollecting a conversation. They have it on paper.

ROMANS: Yes.

GAGLIANO: For him to say "love it" in quotation marks about incriminating information, and then to say, almost as it seems, hold it until September. It's June right now. Let's get closer to November when it's more damaging.

ROMANS: Yes, love it, especially if it's later in the summer.

GAGLIANO: Especially if it's later in the summer, and then for the description from Goldstone to be, this is part of Russia and its government's support for Mr. Trump. That right there is so damning.

BRIGGS: Does this give Bob Mueller a different path to go down? And I bring up this point of the e-mails when they say to Donald Trump Jr., I can also send this info to your father via Rona, that is Rona, his long time assistant of now President Trump. So, if you're Bob Mueller, is that where you're going next? You want the e-mails from Rona to see if this went to the top?

GAGLIANO: Absolutely. I mean, I listened to the interview last night that don Jr. had and he stated unequivocally that there had been no conversation with his father. Now, is that plausible? You could say that particular point in time during the transition, there were probably hundreds of meetings. Every day, there were dozens and dozens and dozens of meetings. It's going to be very, very interesting as you just said when the subpoena powers of special prosecutor start to bring in more of this, physical evidence that they're able to look at and if those e-mails are available, it's going to be trouble.

ROMANS: Let's listen to more of Don Jr. from last night with Sean Hannity. He's saying now that, you know, this is all about transparent. And this is a White House that has been anything but transparent, many critics have said.

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HANNITY: Did you hand over any and all documents?

TRUMP JR.: Well, I will. I've said it publicly, I said it yesterday. More than happy to cooperate with everyone. I just want the truth to get out there.

And that's part of why I released all the stuff today. I want to get all out there. They're trying to drag out the story, in fairness. You know, they have -- they want to drip a little bit today, drip a little bit -- and I was like, here it is. I'm more than happy to be transparent about it and I'm more than happy to cooperate with everyone.

HANNITY: So, as far as you know, as far as this incident is concerned, this is all of it?

TRUMP JR.: This is everything. This is everything.

(END VIDEO CLIP)

ROMANS: That little slam at the media there for the drip, drip, drip. I mean, the drip, drip, drip you could argue was because there wasn't transparency in the first place. There was just pieces coming out.

BRIGGS: But now, it's a spigot.

ROMANS: But now, it's a spigot.

BRIGGS: So, thank you.

ROMANS: Where's the leaking? Where's the leaking coming from?

I mean, these are e-mails, other people were also CC'd on, no question. You had Paul Manafort in that meeting. You had Jared Kushner in that meeting. Jared Kushner now going back and modifying we're told some of his disclosure forms to who's met with.

Where's this leaking coming from?

GAGLIANO: It's interesting. It's got to be somebody that's very close to the former campaign or in the White House right now. I mean, it's got to be somebody that's very tied in to get personal e-mails between Don Jr.'s associate, Goldstone, and Don Jr. himself. It's got to be somebody pretty close to it.

I look at what Donald Trump Jr. tried to do. When you talk about the transparency piece of this and how we frame transparency, this is a classic legal tactic. If you've got derogatory information about one of your witnesses from the prosecution or the defense side, you always want to put that in front and get that out first to kind of downplay.

[04:45:05] And that's exactly what it appears that he did.

BRIGGS: But we should be clear, from a criminal standpoint, do you see anything here even if it comes to campaign finance laws?

GAGLIANO: Dave, I think that would be the only realistic avenue. The collusion piece, again, unless it's Major League Baseball in the late '80s, it's an antitrust case, I just haven't seen it used. I have not seen that federal statute applied and I can't see it being applied here.

It doesn't mean in the political realm, if they go toward impeachment, high creams and misdemeanors, that there's an application. I just think that the campaign finance piece is going to be probably the angle that the special prosecutor is looking hardest at.

ROMANS: There's the political and there's the legal. And the political is damaging politically. It's embarrassing, you know?

BRIGGS: No question.

ROMANS: And it's a huge distraction for a president who's getting ready to go to France for Bastille Day, you know, and it overshadows the fact that he sat down just three days ago with the Russian president.

BRIGGS: Wow.

ROMANS: Jim Gagliano, thank you. Nice to see you.

BRIGGS: OK. No shortage of jokes from late night comedians on this latest Trump/Russia story.

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STEPHEN COLBERT, COMEDIAN: I'd like to apologize to Eric Trump. We always thought you were the dumb one. We were wrong.

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BRIGGS: Let's see more late night laughs ahead on EARLY START.

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[04:50:32] SEN. MARK WARNER (D-VA), VICE CHAIRMAN, INTELLIGENCE COMMITTEE: These facts that are shown in the last 24 hours that there clearly was a Russian government effort to discredit Clinton and to help Trump and that Trump officials at the most senior level were aware of that. How high that goes, we've still got questions to ask.

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ROMANS: Members of Congress stunned by the release of Donald Trump Jr.'s e-mails. For Republicans, it is another disturbing distraction. One senior GOP source, senior GOP source telling CNN, quote: This Donald Jr. thing is just another depressing turn. We're just watching incompetence and stupidity like we've never seen before and it's making the jobs for good people in government that much difficult.

We get more from CNN's Manu Raju.

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MANU RAJU, CNN SENIOR CONGRESSIONAL REPORTER: Good morning, Christine and Dave.

Now, the reaction on Capitol Hill really has been all over the map. You have some senators and congressmen who are frankly concerned. Concerned that these leaks are becoming a major distraction at a key time when the Senate is trying to move a health care bill or frankly having a very difficult time getting their party behind. Some are punting on the matter altogether, including the Senate Majority Leader Mitch McConnell. And others say this is just another problem in a growing controversy that some Republicans are even calling a scandal.

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: Any time you're in a campaign and you get an offer from a foreign government to help your campaign, the answer is no. So, I don't know what Mr. Trump Jr.'s version of the facts are. Definitely, he has to testify. That e-mail was disturbing.

SEN. JOHN MCCAIN (R), ARIZONA: Other shoes will drop. Other shoes will drop before this thing is over. I've said that for weeks.

REPORTER: How damning does this look?

MCCAIN: Have to see what it's all about.

RAJU: Senate Minority Leader Chuck Schumer did say that Donald Trump Jr. should testify publicly and also said that he should turn over all relevant documents to the key committees investigating this issue.

Senator Richard Burr, who is running the Senate Intelligence Committee's investigation to Russia meddling and this collusion, says they're very early in their investigation and clearly, this is an area, Christine and Dave, that they plan to look into much further -- Christine and Dave.

(END VIDEOTAPE)

ROMANS: All right. Manu, thank you for that.

BRIGGS: Donald Trump Jr.'s e-mail drop gave late night comedian Stephen Colbert plenty of material for last night.

(BEGIN VIDEO CLIP)

COLBERT: Trump Jr. was told in an e-mail that this was a Russian effort to aide Trump's campaign.

Wow, who could have predicted an e-mail scandal would taint a presidential campaign?

Official documents and information that would incriminate Hillary and her dealings with Russia and would be very useful to your father.

I'm sorry. Just got a little cough because of this smoking gun I just found.

You know who else couldn't believe that Don Jr. published these e- mails this morning? The journalists who have been drying to dig them up for months.

One reporter tweeted, I worked on this story for a year and he just -- he tweeted it out.

I spent like hours and days and weeks and months and his son just hit tweet.

I tracked down forces. I followed so many dead leads. I labored over this and then he just, you know, tweeted out the proof.

Goldstone spells out that it's part of Russia and its government's support for Mr. Trump. This could not be any more damning if Goldstone had sent him an Evite.

You are invited to commit tree-son. Wood you like to betray your country? Yes, no?

Yes, yes.

(END VIDEO CLIP)

ROMANS: The twinkle in his eye, a spring in his step.

BRIGGS: Yes. He's feeling it in his groove right now.

ROMANS: All right. Senate Majority Leader Mitch McConnell confirms the new GOP health care bill will be unveiled tomorrow, an assessment from the Congressional Budget Office, the so-called CBO score expected early next week, McConnell wants a procedural vote by mid week.

If divided Republicans cannot follow that timeline, they won't get to go home for their early August recess. That break has been pushed back to the third week of August by McConnell, to allow his conference more time to get to yes on repealing and replacing Obamacare. Meanwhile, Senator Lindsey Graham says he and other colleagues are drafting their own health care proposal that will be likely added to the current bill as an amendment.

[04:55:05] Senator Graham is not sharing details of his plan but a senior Democratic aide says the senator has reached out to Democrats regarding a potential bipartisan approach.

BRIGGS: All right. The American League continuing its all star dominance, winning its fifth straight midsummer classic last night in Miami. Seattle's Robbie Cano belting a home run to lead off the 10th inning, giving the American League a 2-1 victory, 15 games for the all star AL team.

Cano's Mariner teammate, this was probably the highlight of this game other than home run, Nelson Cruz, yes, he came to bat with his cell phone, and had the catcher take a photo of he and the umpire Joe West, who has been behind the plate for 5,000 games.

ROMANS: Wow.

BRIGGS: More than 30 -- this is an incredible moment. They're going towards the NFL pro-bowl now and the NBA all star game. If it can't be interesting at least make it fun and lively. So, late night, not a thrilling, but you have that.

All right. More than 30 million people facing severe weather this morning in parts of the Midwest.

Pedram Javaheri has the forecast.

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PEDRAM JAVAHERI, AMS METEOROLOGIST: Good morning, Dave and Christine.

Big time heat across much of the Central and also parts of the Eastern U.S. as well. We're talking about middle 90s, widespread from Kansas City out towards St. Louis, getting up to the upper 90s there, in Cincinnati, around 93, Washington at 95. You've got to work your way out towards Marquette areas, well to the north here to get some cooler temps in place, about 67 out of that region.

But notice, the severe weather concern around parts of the Great Lakes, working its way on to the Northeast and that's precisely where we had major issues yesterday with over 6,000 flights either delayed or cancelled. The vast majority of those delays scattered across the Midwest as well. So, here, what it looks like for this morning and to this afternoon, strong storms push in right across portions of northern Michigan, eventually into parts of western Ohio as well.

And notice the cooling trend that quickly comes back after we get through this. As you hear the next couple of days, we get down to 77 in places like Chicago, the middle 80s in St. Louis, 70s for New York City. That could be among the coldest temperatures we've seen for this time of year for an afternoon high. So, certainly, a big change in store here going into this weekend -- guys. ROMANS: All right. Pedram, thank you.

Let's take a look at your money this morning. Global stock markets mostly higher today after Donald Trump's Jr.'s e-mails triggered a kneejerk drop on Wall Street. The Dow fell about 150 points after the release of these e-mails and recovered all the losses by the closing bell. That's because, overall, basically Wall Street ignores turmoil in Washington.

Instead, investors are focusing on corporate earnings, which have been very good. Second reports kick off this week. And expectations are high. Last season was the best in years for profits.

Folks also keeping an eye on the Fed Chief Janet Yellen. She heads to Capitol Hill today for her twice yearly testimony on the state of the economy. It is her final address before her term ends in February.

Takata's recall is the most in automotive history. Now, the company is expanding it by another 2.7 million airbags. Takata's reporting a new hazard in its air bag, this applies to vehicles made by Ford, Mazda and Nissan from 2005 to 2012. Takata's recall already affects, get this, 42 million cars and trucks.

Its faulty inflators can explode. They spew shrapnel upon impact. The flaw is linked now to 17 deaths and more than 100 injuries worldwide. Don't ignore this.

Microsoft is bringing broadband Internet to rural America. Thirty- four million Americans don't have access to high speed Internet, and the majority who live in rural areas. So, Microsoft plans to use unused TV spectrum satellites to bring broadband to 12 states this year. They'll also partner with local telecom companies to connect up to 22 million by the year 22.

Microsoft isn't the first to expand access to remote areas. Google and Facebook already have similar initiatives in place, trying to get everybody connected.

BRIGGS: All right. Very good.

The latest on the Don Trump Jr. e-mail scandal when EARLY START continues right now.

(BEGIN VIDEO CLIP)

TRUMP, JR.: In retrospect, I probably would have done things differently.

(END VIDEO CLIP)

ROMANS: Donald Trump Jr. on the defensive after releasing e-mails showing he was ready to accept Russia's help during the election. Now, all accounts suggest the chaos in this White House is reaching peak levels.

EARLY START's coverage of all this begins right now. Good morning, everyone. Welcome to EARLY START. I'm Christine

Romans.

BRIGGS: I'm Dave Briggs. It is Wednesday, July 12th. It is 5:00 a.m. in the East.

This morning, an already fractious White House and escalating chaos coping with the fallout from Don Trump Jr.'s meeting with the Russian lawyer and his release of the e-mails setting it all up. "The New York Times" out front on all this says the president's aides and lawyers have formed what the paper calls a circular firing squad, slamming each other to the decisions made since Don Jr.'s meeting with the Russians came to light.