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EARLY START

Mattis Warns North Korea; Trump Wants To End DACA; Harvey Funds Linked To Debt Ceiling?; City of Beaumont Still Reeling From Harvey. Aired 5:30-6a ET

Aired September 4, 2017 - 05:30   ET

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


[05:30:00] ALISON KOSIK, CNN ANCHOR: The statement notes Kate is suffering from morning sickness, although it uses the Latin name for it.

The new baby is going to join big brother George and sister Charlotte. Congratulations to her and her family.

ALEX MARQUARDT, CNN ANCHOR: A growing brood.

KOSIK: Absolutely.

MARQUARDT: EARLY START continues right now.

(BEGIN VIDEO CLIP)

JAMES MATTIS, SECRETARY OF DEFENSE: Any threat to the United States or its territories will be met with a massive military response -- a response both effective and overwhelming.

(END VIDEO CLIP)

KOSIK: The Secretary of Defense with a firm warning for North Korea after Pyongyang's latest nuclear test. Now we've learned the U.S. and South Korea, they'll look to deploy military assets, including bombers. We are live in Seoul.

MARQUARDT: And, President Trump will propose ending protections for undocumented immigrants who came to the United States as children, but could Congress give the so-called Dreamers another chance?

KOSIK: And could billions in recovery funds for Harvey victims be tied raising the nation's debt limit? The Treasury secretary says yes.

MARQUARDT: Welcome back to EARLY START. I'm Alex Marquardt.

KOSIK: Good morning, I'm Alison Kosik. It's 30 minutes past the hour.

MARQUARDT: Now, top U.S. defense officials are responding to North Korea's biggest nuclear test yet with a blunt warning. Defense Secretary James Mattis advising that any threat by Pyongyang against the U.S. or its allies would draw what he called a massive military response. Mattis' warning came after a meeting with the president, the vice president, and top national security advisers.

Mattis said, quote, "Our commitments among the allies are ironclad."

(BEGIN VIDEO CLIP)

MATTIS: Any threat to the United States or its territories, including Guam or our allies, will be met with a massive military response -- a response both effective and overwhelming. We are not looking to the total annihilation of a country, namely North Korea. But as I said, we have many options to do so.

(END VIDEO CLIP)

KOSIK: The new warning comes after North Korea's claim it tested a hydrogen bomb Sunday, a test overseen by leader Kim Jong Un. Pyongyang claimed the weapon was designed to be carried by an intercontinental ballistic missile, the kind it has also been testing.

President Trump was asked about the nuclear test on Sunday. That's as he left a church service.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Mr. President?

UNIDENTIFIED MALE: Mr. President, will you attack North Korea?

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We'll see.

(END VIDEO CLIP)

MARQUARDT: The U.N. Security Council is set to meet in emergency session this morning in the wake of this latest test. It's the second meeting in just a week but past meetings have done little to stop North Korea's provocations.

Earlier this morning, South Korea's Army and Air Force conducted a combined live-fire exercise in response to the North Korean nuclear test. And now, North Korean state media is blasting South Korea for the drill, saying that it shows that Seoul is quote, "hell-bent on escalating confrontation."

The exercise came after President Trump called out South Korea on Twitter, suggesting that Seoul is appeasing the North Koreans.

CNN correspondent Ian Lee is live in Seoul, South Korea with us with that regional response. Good morning, Ian.

We are seeing lots of escalation this morning. What kind of responses are you hearing there on the ground?

IAN LEE, CNN CORRESPONDENT: Hey, good morning, Alex.

Yes, we had that live-fire exercise early in the morning here. It was directed at the North Korean leadership and their nuclear program, saying they have ballistic missiles and air-to-ground missiles -- advanced air-to-ground missiles that could go after the leadership and their nuclear infrastructure in the event of a war. That's a strong message coming from the South Koreans.

And, South Korea also saying they're working with the United States to bring advanced weaponry to the Peninsula. Now, they didn't say what that weaponry was, but with the talks that it could be nuclear, the South Korean leadership said that they're committed to the denuclearization of the Korean Peninsula.

Now, this happening as intelligence is saying that North Korea is preparing for another ballistic missile test. They didn't say when that would take place but they are watching that very carefully to see if it is one of their intercontinental ballistic missiles.

You know, also this morning, we're getting reaction to a Trump tweet that said that the South Korean president was trying to appease the North Koreans. And it's true that President Moon came out initially about wanting a softer approach with the North -- dialogue, sitting down, hashing it out.

But he inherited a different situation and we've seen a tough response from this president. We've seen a number of these military exercises that also involved the United States and some strategic hardware from the United States like the B-1 bomber.

So, South Korea having this strong force but also trying to rally the international community at the U.N. Security Council, like you said, to isolate North Korea both diplomatically and economically -- Alex.

[05:35:00] MARQUARDT: Yes, that meeting taking place later this morning here in New York.

Our thanks to Ian Lee in Seoul.

KOSIK: Treasury Secretary Steve Mnuchin says he's drafting new sanctions to put economic pressure on North Korea. This coming just weeks after the U.N. Security Council passed its latest round of sanctions aiming to kill $1 billion worth of North Korean exports by hitting major industries such as coal, iron ore, and seafood.

So what's left for President Trump to go after? Curtailing oil shipments to North Korea from China is one of the measures the U.S. is seeking. Textiles and apparel are also potential targets.

And taking stronger actions against Chinese banks, that's also an option. But some experts are warning that by ramping up the pressure on Beijing, President Trump could provoke a Chinese backlash against U.S. businesses in the region.

MARQUARDT: Breaking overnight, President Trump is moving to end the program that protects undocumented immigrants who came to the United States as children, but the move is far from a done deal.

Multiple sources telling us that the White House is looking at a six- month delay in any action against the so-called Dreamers so that Congress has time to pass legislation which would allow them to stay in the country.

KOSIK: The expected move ending the Deferred Action for Childhood Arrivals program called DACA. It comes weeks -- after weeks of deliberation within the White House. The move may satisfy the president's base but could also disrupt the lives of nearly 800,000 people working and studying in the U.S.

MARQUARDT: Several sources are cautioning that this decision is not final until it's announced on Tuesday but already, there's been a flood of reactions with immigration advocates calling it cruel, while Trump's core supporters are applauding it as the restoration of the rule of law.

KOSIK: And if the president plans to end DACA but gives Congress a chance to let Dreamers stay, will lawmakers go along with the president's decision? We'll get into that next.

(COMMERCIAL BREAK)

[05:41:05] (BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Should Dreamers be worried?

TRUMP: We love the Dreamers. We love everybody.

(END VIDEO CLIP)

KOSIK: He loves them but he wants them out.

President Trump will propose ending the program that protects undocumented immigrants who came to the U.S. as children -- so-called Dreamers. But part of the plan will allow Congress to get involved, which means any final action still up in the air.

Joining us again, "Washington Post" reporter Eugene Scott. Good morning, again.

MARQUARDT: Good morning. Welcome back.

KOSIK: So let's dig into this because we are getting this conflicting message from President Trump. Listen to what he said just a day or two ago.

(BEGIN VIDEO CLIP)

TRUMP: We're going to deal with DACA with heart. I have to deal with a lot of politicians, don't forget, and I have to convince them that what I'm saying is right, and I appreciate your understanding on that.

But, the DACA situation is a very, very -- it's a very difficult thing for me because, you know, I love these kids. I love kids.

(END VIDEO CLIP) KOSIK: OK, but here's the thing. He's basically going to decide on this -- maybe, probably punt it to Congress who then have spoken pretty well on Twitter by Joaquin Castro, a representative in Texas, saying, "For all the members of Congress over the past five years who said DACA should've been done legislatively, here's your chance."

Just a reminder to those who don't know. President Obama signed DACA through an executive order so, yes, now is a chance for Congress to step in.

Is this a situation where President Trump is using this kind of like as a political football? A negotiating tactic to say hey, you're going to defend DACA, I'll let you do that, but I want my wall.

EUGENE SCOTT, REPORTER, WASHINGTON POST: Well, that's interesting. I mean, it could be -- I mean, he definitely paints himself as this kind of negotiations.

But I think what's very interesting is we've seen President Trump just repeatedly make decisions that are meant to just reverse whatever President Barack Obama has done.

And even in that clip we saw when he's expressing the difficulty, he said, of this issue, I think it just highlights how unfamiliar he has been with this. This is not something he has a lot of experience working on and he's made it very clear that he does want to do what's in the best interest of these children, which is powerful because the majority of Americans do support DACA.

MARQUARDT: And, Eugene, we know that in modern times -- switching gears a little bit -- that presidents leave letters in the Resolute desk, if that's the best that they choose --

SCOTT: Right.

MARQUARDT: -- for their successor.

We know President Obama left a letter for President Trump on his way out of the White House. In fact, there are pictures of it. But now, the text -- excuse me -- is finally coming to light. We've got a clip of that I just want to read to you.

It is, "American leadership in this world really is indispensable. It's up to us through action and example to sustain the international order that's expanded steadily since the end of the Cold War, and upon which our own wealth and safety depend."

Now, our White House reporter Kevin Liptak is the one who broke this --

SCOTT: Yes.

MARQUARDT: -- and in his reporting he said that this is a letter that President Trump shows off to people who visit the White House.

SCOTT: Right. MARQUARDT: Now, he clearly values that letter. Do you think he values the message, particularly when it comes to dealing with things like North Korea today?

SCOTT: Well, President Obama certainly hopes he does, right? I mean, I think that reference to the Cold War was not just about North Korea but also about Russia.

I think it's all fascinating, quite frankly, considering how non- existent the relationship between President Obama and President Trump reportedly are considering the magnitude of issues that we're discussing right now.

North Korea, DACA -- these are things -- even Hurricane Harvey. These are things that President Obama has quite a bit of experience dealing with and you would think that somehow a relationship with Trump could improve how this current administration would respond to these issues.

KOSIK: Yes. You look at this week, Congress coming back in session and they've got a lot to tackle. Let me look at my laundry list here.

They've got -- they've got to pass a spending bill, they've got to agree on a budget, they've got to raise the country's borrowing limit. They've, potentially, got to fix Obamacare. They've got to find a way to tax reform.

We haven't even mentioned a package for Harvey aid and we certainly haven't mentioned North Korea.

[05:45:10] What are we -- what are we seeing happen with Congress? We've seen a Congress not getting much done already and a laundry list that's going for miles.

SCOTT: Well, there's certainly a lot of pressure on them from people on both sides of the aisle to actually bring about results because as you noted, this summer has not been as eventful or productive as the president campaigned on.

Whether or not they'll be able to coalesce and get on the same page with these very important issues where time is far more urgent when we think of something like Harvey, when we think of something like the debt ceiling, and even DACA, considering some of the pushback he's got, it remains to be seen. But there's certainly a lot of hope that they will.

KOSIK: All right. Eugene Scott, thanks again for your analogy.

MARQUARDT: Thanks for joining us so early.

SCOTT: Thanks.

MARQUARDT: A time for what's look -- a time for a look at what's coming up next. Alisyn Camerota joins us this morning. Alisyn, what can we expect on "NEW DAY"?

ALISYN CAMEROTA, CNN ANCHOR: Great to see guys. Happy Labor Day. KOSIK: Good morning.

CAMEROTA: So, obviously, we'll have all of the latest on the North Korea developments. We have a roster of great experts for you, including Gordon Chang and former special envoy Bill Richardson.

And then, the news overnight affecting DACA, the Dreamers here in this country. So what's next? We have all sorts of lawmakers on to see if they will be able to come up some sort of legislation in the next six months to change the course of President Trump's announcement.

And then, don't adjust your T.V.'s, it's not 2012. Look who I am reunited with. Dave Briggs, my old co-host and we are going to --

DAVE BRIGGS, CNN ANCHOR: Applause are going wild around the studio.

CAMEROTA: In the studio, everybody is applauding and standing, if they're not sleeping. And we are going to have three fun hours together somehow.

BRIGGS: A fun North Korean nuclear threat.

KOSIK: The dynamic duo.

CAMEROTA: That's right. We're going to make it somehow fun.

MARQUARDT: It's great to see you back together.

KOSIK: I was going to say, the dynamic duo back together. We'll be watching.

CAMEROTA: Thank you, guys.

KOSIK: See you then.

MARQUARDT: Take care.

KOSIK: How are global markets responding to North Korea's biggest nuclear test yet? We're going to get a check on "CNN Money Stream," next.

(COMMERCIAL BREAK)

[05:51:30] (BEGIN VIDEO CLIP)

STEVEN MNUCHIN, SECRETARY OF THE TREASURY: Our first priority is to make sure that the state gets money -- it is critical. And to do that, we need to make sure we raise the debt limit. So if we -- if Congress appropriates the money but I don't have the ability to borrow more money and pay for it, we're not going to be able to get that money to the state.

(END VIDEO CLIP)

KOSIK: And that was Treasury Secretary Steve Mnuchin over the weekend. And the Trump administration now saying it wants federal spending on relief for Hurricane Harvey to be tied to raising the debt limit.

The move setting up a potentially fierce political battle. The ultraconservative wing of the GOP doesn't want to raise the debt ceiling without spending cuts, which means they would have to vote against aid for Texas if the debt ceiling and Harvey aid are tied together.

MARQUARDT: The White House has already asked Congress to approve a $7.8 billion package as part of an initial request for funds. A request for more cash is expected later this month.

The death toll for Hurricane Harvey now stands at 53. Thousands of people are still unable to return home and tens of thousands more are still living in shelters and relying on aid.

In just the last few hours officials have lifted the evacuation zone around the Arkema chemical plant near Houston, after remaining trailers full of explosive chemicals were deliberately set ablaze in a controlled ignition. A Harris County fire marshal says there's no additional risk to the community.

In Houston, across the southeast Texas flood zone, piles of trash lining the streets, just devastating. Items big and small left unsalvageable after sitting in water for days.

MARQUARDT: There is one piece of good news this morning. Officials now saying that 95 percent of Houston is dry. The city's mayor says that most businesses will reopen after the holiday tomorrow.

A small area evacuated in West Houston does remain in dire shape. The floodwaters there not receding because of nearby dams releasing water. Water levels at the Addicks and Barker dams are dropping but the emptying of the reservoirs will take weeks.

KOSIK: Drinking water has been a big concern in some flooded areas. As of this morning, of the 4,500 drinking water systems potentially affected by Harvey, 166 have boil water notices and 50 are shut down.

In Beaumont, Texas, the water can only be used to bathe or flush at this point. Officials estimate people there will have to boil water for possibly up to a month more.

CNN's Miguel Marquez brings us the latest from Beaumont.

(BEGIN VIDEOTAPE)

MIGUEL MARQUEZ, CNN NATIONAL CORRESPONDENT: Alison, Alex, this is the Neches River in the middle of Beaumont and this is a good thing right now. This is an industrial area that is still clearly inundated by water, but much lower than it was when it was at its highest peak.

It peaked here around 1:00 p.m. on Saturday and I want to show you just how far it's come down since then. That's where it is now, up here is where it peaked.

And this isn't the only place having problems. There are still neighborhoods in Beaumont that are completely underwater.

There are towns around Beaumont that are still inaccessible. Places like Double Oak, Sour Lake, Pinewood Estates -- all of them still inaccessible because there's six or eight feet of water on the roads between them.

People are coming together here like you've never seen -- handing out water -- in big ways and small. Some local restaurants have even come together -- shut down business for themselves, but serving thousands of meals to evacuees.

[05:55:04] As for the water here, it is sputtering back to life, literally, out of faucets in Beaumont. It is starting to come back. Officials say once the Neches goes down more they'll be able to get to the main pumps for the city water system. They'll then be able to get in there, figure out how to fix them, and get water pressure finally restored to the entire city -- Alison, Alex.

(END VIDEOTAPE)

MARQUARDT: Our thanks to CNN's Miguel Marquez in Beaumont, Texas.

Now with Harvey clean-up just getting started, Hurricane Irma is gathering power out in the Atlantic Ocean.

Meteorologist Pedram Javaheri has the latest on that and our holiday forecast.

(BEGIN VIDEOTAPE)

PEDRAM JAVAHERI, AMS METEOROLOGIST: Good morning, Alex and Alison.

Here's what's going on with Hurricane Irma sitting out there across the Atlantic. And the Leeward Islands really the main area of concern at this point for the immediate landfall of the storm system, sometime on Tuesday night into Wednesday morning.

But notice the consistency in this, remaining a category four. So we think this will be a major hurricane for the foreseeable future and through, potentially, parts of the Dominican Republic, Turks and Caicos, into the Bahamas, maybe even Cuba.

The track right now wants to keep a southerly track on this, taking it potentially around Cuba on into parts of the Gulf. If that verifies, of course, that is bad news for anyone along the Gulf Coast states.

But we do have a massive area of high pressure. The Bermuda high sitting across this region that actually steer and tug the storm system farther to the north and eventually to the east. The possible alternate scenario could be parts of the Carolinas.

If we're lucky, of course, a trough coming out of the eastern U.S. could actually push the storm well off shore. So certainly, several variables at work here over the next few days to watch.

But what's going on across the Northeast? How about some showers. Generally mild temperatures across this region. Expect it to be much, much cooler going into the latter portion of this week.

And looking at the forecast in places like D.C., how about a little bit of fall, from 88 down to around 70 by Wednesday afternoon -- guys.

(END VIDEOTAPE)

KOSIK: OK, Pedram, thanks very much.

Let's get a check on "CNN Money Stream" this morning.

European markets are trading lower while Japan's Nikkei is declining almost one percent at the close. That's after North Korea's biggest- ever nuclear test sent a fresh wave of nervousness through the markets. But traders are saying that the impact of other recent North Korea-related scares, that it hasn't lasted.

U.S. markets are closed today for the Labor Day holiday.

Gas prices continue to rise more than a week after Hurricane Harvey knocked the Gulf Coast oil refining industry off-line, but those price increases are starting to slow, thankfully. Triple A says the national average price for a gallon of regular is up 26 cents in the last week to $2.62.

Hurricane Harvey knocked almost a quarter of the nation's refinery capacity off-line. The Colonial Pipeline, which carries huge amounts of gasoline between Houston and the East Coast, it is expected to be back up and running today.

The damage caused by Hurricane Harvey could be in the billions of dollars -- that's with a "b" -- and some big businesses, they pledged more than $157 million to relief efforts as of this weekend. That's according to the U.S. Chamber of Commerce.

Sixty-nine companies have donated $1 million or more so far. Want to know some of the biggest donors?

Tech billionaire Michael Dell, he's pledged $36 million to relief efforts. Retailer Walmart has pledged up to $20 million in cash, products and matching donations. And, Verizon, it's contributed $10 million.

Nice to see those corporate giants --

MARQUARDT: Lots of money.

KOSIK: -- contributing.

MARQUARDT: Good for them.

KOSIK: Yes.

All right, thanks for joining us. I'm Alison Kosik.

MARQUARDT: And I'm Alex Marquardt.

Tensions rising again on the Korean Peninsula. How the U.S. and allies are responding after another nuclear test from North Korea.

"NEW DAY" starts right now.

ANNOUNCER: This is CNN breaking news.

CAMEROTA: We want to welcome our viewers in the United States and around the world. This is NEW DAY. It is Monday, September fourth, 6:00 here in New York.

Chris is off this morning. Dave Briggs joins me. Great to have you.

BRIGGS: Good to be here.

CAMEROTA: All right. We begin with breaking news.

South Korea says there are signs that North Korea is preparing to launch another intercontinental ballistic missile just one day after Pyongyang detonated its sixth and most powerful nuclear test. South Korea responding by firing missiles into the sea, simulating an attack on North Korea's main nuclear site.

So, in just hours, the U.N. Security Council will hold an emergency meeting to consider even stronger sanctions against the North.

BRIGGS: President Trump lashing out at an ally instead of an adversary, accusing South Korea of quote, "appeasement," while the president's Defense secretary is warning North Korea of a massive military response.

All of this as CNN learns President Trump's expected to end a program that protects undocumented immigrants who came to the U.S. as children from being deported. Now, the move once again pitting the president against many in his own party.

We have the global resources of CNN covering it all for you.

Let's begin with CNN's Will Ripley who was just in North Korean where he's been more than a dozen times. He's live for us in Tokyo with the breaking news out of the region.

Good morning, Will.

WILL RIPLEY, CNN INTERNATIONAL CORRESPONDENT: Hi, Dave.

We are hearing now that a week that already began with a bang could get even more tense here in this part of the world.