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EARLY START

Trump Vs. Bannon; Nor'easter Bears Down; Trump Ends Voter Fraud Commission; North & South Korea Speaking On Hotline. Aired 5:30-6a ET

Aired January 4, 2018 - 05:30   ET

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


(COMMERCIAL BREAK)

[05:30:42] DAVE BRIGGS, CNN HOST: A rather ugly family feud playing out between President Trump and his former top strategist, Steve Bannon. The president living up to his counterpuncher reputation after Bannon's thoughts on the president and his family went public.

CHRISTINE ROMANS, CNN HOST: The president's Voter Fraud Commission decommissioned. CNN has learned the effort to prove the unprovable has been in turmoil for months.

And the first big Nor'easter of the season is churning up the east coast. Major snowfall is expected in parts of the northeast before temperatures drop to levels seen on Mars. I'm not kidding.

EARLY START's coverage of all of our top stories continues right now. There's a Mars and Venus reference there somewhere but I'm just going to leave that.

BRIGGS: Mars -- colder than Mars. All right.

So, the book is "Fire and Fury: Inside the Trump White House." It's out next week.

The good news is for the president, if it's true, he won't have to read it. He won't even have to skim it. You'll have to read this to understand what I'm talking about.

Good morning, I'm Dave Briggs.

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

From President Trump, a crushing rebuke to his former chief strategist Steve Bannon. The White House releasing a stinging statement. A very unusual takedown after excerpts from an up and coming book came out.

This book quotes Bannon calling the meeting between a Russian lawyer and top Trump officials treasonous and unpatriotic. Steve Bannon also reportedly told the author, Michael Wolff, quote, "They're going to crack Don, Jr. like an egg on national T.V."

And there's so much more -- just so much more.

BRIGGS: There is, indeed. We only have 30 minutes left. The president now claiming, though, Bannon lost his mind after he lost his White House job.

The statement says, "Steve Bannon has nothing to do with me or my presidency. Now that he is on his own, Steve is learning that winning isn't as easy as I make it look.

Steve had very little to do with our historic victory, which was delivered by the forgotten men and women of this country."

ROMANS: Bannon, himself, responding late last night. He was speaking on Sirius XM's "Breitbart News Tonight" -- it's a radio show -- and this is what he said.

(BEGIN VIDEO CLIP)

STEVE BANNON, FORMER WHITE HOUSE CHIEF STRATEGIST: And the President of the United States is a great man. You know, I support him day in and day out, whether going through the country giving the Trump miracle speech or on the show or on the Web sites. I don't think you have to worry about that.

(END VIDEO CLIP)

ROMANS: And we also have new insight on what is fueling President Trump's anger over the last few days and that's a remarkable tale. More on that in a moment.

But first, correspondent Jeff Zeleny begins our coverage from the White House.

(BEGIN VIDEOTAPE)

JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Christine and Dave, an extraordinary war of words breaking out between President Trump and his former top strategist Steve Bannon, all over the release of a new book coming out talking specifically about the Russia investigation.

Steve Bannon, of course, fired from his job in August but still in touch with the president, accused the president's son, son-in-law, and former campaign manager of treasonous behavior -- unpatriotic behavior, in his words -- all about the 2016 meeting at Trump Tower with those three officials and a Russian lawyer.

Now, this is all coming out in new details in a book coming out later this month, "Fire and Fury: Inside the Trump White House."

Now, Steve Bannon used extraordinary language here describing the president's family, describing their ambitions, their motives. The president shot back with a very harsh statement on Wednesday.

Now, in the White House briefing on Wednesday, Press Secretary Sarah Sanders -- she described the book as trashy tabloid fiction. She also said the president's reaction was this. SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: I think furious, disgusted would probably certainly fit when you make such outrageous claims and completely false claims against the president, his administration, and his family.

ZELENY: But these explosive comments actually undermine the argument of the White House for more than a year trying to discredit and downplay the Russia investigation. Steve Bannon says he believes this is all about money laundering. That's where this will ultimately go.

Now, of course, the relationship between the president and Steve Bannon has been fractured, no question. The open question is, though, if they will stay separated or if they will somehow rejoin forces once again. The president, of course, so many times has been furious with some advisers, only to bring them back into the fold.

But this war of words, unlike anything we've seen in the first of this Trump White House -- Dave and Christine.

(END VIDEOTAPE)

BRIGGS: All right, Jeff Zeleny, thanks.

Steve Bannon's flame-throwing sparked a cease and desist letter from the president's lawyers last night, demanding Bannon refrain from making disparaging remarks about Mr. Trump and his family.

[05:35:05] Sources tell CNN the president began the year furious at his legal team for repeatedly pushing back the timeline for the end of the Russia investigation.

ROMANS: CNN reported last month some members of the president's inner circle feared he would erupt early in 2018 if the end of the probe was not near.

The president's rage boiling over Tuesday in a rambling 16-tweet assault covering a range of topics, including the bizarre taunting of Kim Jong Un. The president says his nuclear button is bigger. Yes, tweeting and taunting about nuclear war.

Aides inside the White House asking some of the president's top allies now to speak to him about the risk those tweets represent.

BRIGGS: Accounts of the president's volatility come from interviews with a dozen White House officials, lawmakers, and other Republicans. They paint a picture of a president who is intent on shaking up the country's political norms even as he faces crucial deadlines in the coming weeks on immigration and government funding.

Meanwhile, the weather is nasty along the east coast. A fierce Nor'easter making its way up the coast this morning. Major cities like Philadelphia, New York, and Boston all seeing heavy accumulations.

Schools are closed in all three cities and more than 2,800 flights have already been canceled for today in the U.S., the vast majority of those along the east coast.

The governor of Connecticut urging drivers to stay off the roads.

ROMANS: In Boston, grocery store shelves already bare as people hunker down. And after the snow, comes the big chill, so cities will have to plow quickly.

(BEGIN VIDEO CLIP)

MAYOR MARTY WALSH, BOSTON, MASSACHUSETTS: On Friday night and Saturday we're going to have very cold weather, down below zero. So, it's important for us that we get this snow off of the ground as best we can tomorrow because once the freeze comes in it will be almost impossible to move the ice that will be formed.

(END VIDEO CLIP)

ROMANS: And we are already in it, folks. Thirty-one thousand customers without power in Virginia and another 10,000 in North Carolina.

The cold already fatal. At least 12 deaths across the country since Tuesday.

For the very latest let's go to meteorologist Derek Van Dam in the CNN Weather Center. Some of those pictures, too, of beautiful Charleston and the lovely fountains and the --

DEREK VAN DAM, AMS METEOROLOGIST: Yes.

ROMANS: -- beautiful palm trees, and the five inches of snow, it's just so interesting.

VAN DAM: It's the weird juxtaposition. You don't exactly think about the southeast of the United States to get snow, especially as far south as the Florida Panhandle -- unbelievable.

If this graphic behind me doesn't give you a headache I don't know what will.

Twenty-eight hundred plus cancellations. That number keeps driving up in the major airports along the east coast. Boston to Philly, all the way to New York City.

This is what we're expecting at the CNN Weather Center.

We're anticipating three to six inches for Philadelphia. The Big Apple, four to eight inches. And you read that right in Boston. You could easily experience upwards of a foot, if not more, by the time this storm is all said and done by early Friday morning.

The other factor here is the strong winds, gusting anywhere from 50 to 60 miles per hour, especially along those coastal areas, even into Cape Cod. That's where we have blizzard warnings right now. Over 15 states have some sort of winter weather advisory, as we speak, along the east coast. Timing this thing out, you can see the snowfall just blanketing parts of Washington into Philadelphia. New York, it's really knocking on your doorstep now.

We anticipate the snow to become heavy right along that I-95 corridor. We know how busy that gets and when you mix in snow and wind it becomes very, very treacherous on the roadways.

Anticipating the heaviest snowfall in the Big Apple from 7:00 a.m. this morning right through 2:00 p.m. this afternoon. Then, we focus our attention towards Boston for the evening commute.

And again, we're factoring in the winds as it draws in the cold air behind it. This is not a typo. We're dropping into the single digits for some locations and it's going to be very cold.

You know, Dave had mentioned this common term that's been thrown around the Internet and some of the other media outlets -- bombogenesis. That's when you drop 24 millibars -- a measure of pressure in the atmosphere for a low-pressure system in 24 hours.

This particular storm system is dropping 24 millibars in 12 hours. That is a strong, strengthening low-pressure system that's going to drive up the east coast -- Dave, Christine.

ROMANS: All right. Strong, strengthening, low, blah, blah, blah, blah, blah. It means snow, snow, cold, cold.

VAN DAM: It means snow and cold, that's right.

ROMANS: And it means my kids are home again after being -- oh, more quality time with the little ones.

BRIGGS: That is true. All right, thanks, Derek.

ROMANS: All right, thanks.

All right, to money now.

Auto sales last year feel for the first time since the financial crisis demand slowed after years of incredible growth. A modest dip in annual U.S. sales of nearly two percent to 17.2 million vehicles.

But don't panic, the industry is still in pretty good shape. Automakers sold more than 17 million cars for the third year in a row, plus record global growth is expected.

The last annual decline occurred under very different circumstances. Auto sales plunged 21 percent, remember, in 2009 amid the Great Recession. U.S. car companies dealing with high labor costs and low sales.

But customers today are buying cars and they're buying more expensive models. The average car price climbed last year to a record high. In fact, the overall sales decline is mainly due to a drop in purchases by rental car companies, not everyday Americans. [05:40:07] So, a slowdown, an important economic indicator, but don't panic.

BRIGGS: Interesting. All right, ahead, the president's attorneys want to silence Steve Bannon. A cease and desist letter capping off an angry response after Bannon's harsh thoughts about the Trump family and more went public.

(COMMERCIAL BREAK)

ROMANS: All right.

Steve Bannon's fire met with President Trump's fury. The White House with a statement like you have never seen before --

BRIGGS: Yes.

ROMANS: -- trashing the former chief strategist.

Will Bannon's takedown of the Trumps hurt his own stock as the midterms near?

"CNN POLITICS" reporter Tal Kopan live for us in Washington. Good morning.

If you live in a cave and you've just woken up this morning and you're hearing these headlines, let me explain what's happening. I don't mean you, I mean for our viewers.

There is a book by Michael Wolff, who is a kind of fuzzy book author.

BRIGGS: Yes.

ROMANS: Not a Woodward and Bernstein, but someone who --

BRIGGS: Fair assessment.

ROMANS: -- had good access to the White House. Was on a couch there in the West Wing offices and interviewed 200 people, and has come out with this big book and pieces of it have been coming out.

And I think the bottom line here -- a few takeaways. Trump and the team didn't ever think he would win. They never did, so some of the recklessness --

BRIGGS: But maybe he didn't want to according --

ROMANS: Right.

BRIGGS: -- to the book. And the lack of discipline you see around them, it was because they didn't think that he would be the president.

[05:45:00] Steve Bannon suggests that Donald Trump knew about the Russia meeting with Don, Jr., Manafort, and Kushner, and he even calls it treasonous. He attacks -- in this book, Steve Bannon attacks the president's

family and says Ivanka and Jared made a deal -- this book says Ivanka and Jared Kushner made a deal that if the opportunity arose Ivanka would be the first woman President of the United States.

Is it fair to say that Washington is consumed by the book and its revelations this morning?

TAL KOPAN, REPORTER, CNN POLITICS: I think it's fair to say there's certainly a lot of interest in this book.

You know, it was interesting. I was up on the Hill yesterday evening as senators returned and you ask Republican senators what they make of this and they all brush it off and say oh, I don't pay attention to it. It's all just -- you know, I hope it doesn't distract anyone.

But, certainly, once again, this is what lawmakers are being asked about instead of about policy. This is what's dominating news coverage because it's just so fascinating and remarkable and we've never seen anything like it before. You know, it has implications going into elections in 2018.

So yes, it's partially palace intrigue but it also has ramifications in terms of the soul of the Republican Party and the functioning of the Trump White House.

ROMANS: And the stability of the President of the United States -- the decision-making process around him. I mean, that -- some of this is very, very unflattering for him.

BRIGGS: Yes. The personal characterization of this president is disturbing and I'm not even talking about sitting in bed with a cheeseburger at 6:30 watching three television screens. That's the flattering part of the personal characterization.

But let's get to the legal and the implications down the road because Steve Bannon, on Trump's knowledge about that Trump Tower meeting, is of particular interest.

Here's what Steve Bannon says, again, according to this book. "The chance that Don, Jr. did not walk those jumos up to his father's office on the 26th floor is zero."

Jumos is a word the Internet is debating. Let's just go with clumsy loser from urban dictionary.

What if that is true? What does that mean, and might Steve Bannon have his time before Congress?

KOPAN: Well, look, if that statement is true -- if, in fact, these individuals were introduced to Donald Trump after that meeting then it has incredible ramifications, including the fact that everyone involved has denied it.

But, you know, at this point it's an entirely speculative statement. He is not saying I know for a fact that these individuals were introduced to the president-elect -- or, at that time, the presidential candidate. He's saying the chances that they weren't are pretty low.

And so, a speculative comment like that certainly is not anything that could be considered evidence in an investigation in terms of conclusive evidence. But, it certainly opens the door for investigators, again, to go back and look at it because it is a credible questioning of the truthfulness of those denials and will likely open another round of questions.

And you're absolutely right. It is quite possible that those folks are going to want to interview Steve Bannon now pretty in-depth about this.

BRIGGS: Yes.

ROMANS: It will be really interesting to see how the White House continues here today with its counterpunching on this because we heard the president -- you saw the president's statement. A remarkable statement from the White House.

I'll read part of it. "Steve Bannon has nothing to do with me or my presidency. When he was fired he not only lost his job, he lost his mind. Steve was a staffer who worked for me after I already won the nomination by defeating 17 candidates."

He really minimizes the Steve Bannon influence here, something that every political reporter who has stood in front of the White House cameras says is --

BRIGGS: Not true.

ROMANS: -- not true.

One wonders if he'll -- they will attack the credibility of his author, Michael Wolff. If they will say some of these things are just fake -- if it didn't happen.

What does it mean, do you think, though, for Republicans who are looking for their -- you know, for their north star as they try to win in some of these races in November? I mean, does Steve Bannon continue to have a big influence?

KOPAN: Well, it really makes that a lot more complicated. I think at the end of the day Donald Trump is probably still the most popular figure with his base, maybe rivaled only by Jeff Sessions, the attorney general who has long been popular with this particular base.

But, you know, Steve Bannon isn't necessarily the leader of this base. He's been more of the channeler of it at "Breitbart" for quite some time and an influencer, for sure. But his influence has long been behind the scenes.

It was really his time with Trump that made him a bit of a celebrity. And so, you know, it's likely that voters are still going to consider an alliance with Trump to be a more important factor than the alliance with Bannon.

But there are a number of candidates that were sort of counting on that Bannon support in terms of money, in terms of strategy, in terms of endorsement. They're now having to completely rethink their strategy --

BRIGGS: Yes.

KOPAN: -- if they have to wade into a potential feud between the two men, Trump and Bannon, which way do they go. It certainly makes the water a lot murkier for them and probably, they hope that Bannon will mostly have a behind-the-scenes role and nothing more.

[05:50:02] BRIGGS: Yes, and Bannon always wanted to deconstruct the administrative state but it looks like he blew up his own career at this point. We shall see how it evolves.

Tal Kopan, thanks so much. Appreciate it.

ROMANS: Although last night he called the president a great man, whether he's giving a speech or -- you know he had --

BRIGGS: Damage control.

ROMANS: Right. He had kind words for the president last night. We'll see what happens next.

BRIGGS: All right. President Trump dissolving his highly-touted Voter Fraud Commission. The reason given by the White House, too many states refusing to participate.

The commission has been criticized as a misguided effort to bolster the president's false claim he would have won the popular vote if not for voter fraud.

ROMANS: CNN has learned there has been concern about the commission inside the White House for months. One senior adviser calling it a "blank show that went off the rails."

President Trump appointed Vice President Pence and Kansas Secretary of State Kris Kobach to lead the panel. A source close to the vice president admitted a recent lawsuit against the commission by one of the commission's own members didn't help.

Kobach tells "USA Today" disbanding the commission is just a change in tactics. He insists an investigation into voter fraud will move forward.

BRIGGS: All right. Your retirement party, folks, will have to wait.

No grand prize winner in last night's $460 million Powerball drawing. That means Saturday night's jackpot worth an estimated $550 million. One person in Florida did match five numbers for a $2 million payoff.

Mega Millions north of $400 million. That drawing is Friday night for those not like Christine Romans. ROMANS: Yes. You're just burning your dollar bill but the dream is priceless.

BRIGGS: Dream into luck.

ROMANS: All right, computer security experts have found two major flaws that could virtually all smartphones and computers at risk.

BRIGGS: Wow.

ROMANS: It's not pretty, folks. More on "Money Stream," next.

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BRIGGS: Five fifty-four eastern time.

President Trump's nuclear taunt against North Korea has revived questions about the president's authority to approve the use of nuclear weapons. He sent this tweet in case you forgot, Tuesday, threatening North Korea, touting the size of his nuclear button.

[05:55:07] Democratic Sen. Ed Markey of Massachusetts says, quote, "The cooler heads that once served as our last best hope against the unthinkable seem less reassuring with every tweet President Trump sends."

ROMANS: A leading Republican also raising concerns. Senator John Cornyn, the number two Republican in the Senate, saying, "I don't know how anybody's interests are served by escalating that rhetoric." But, the White House saying his mental health is not a concern.

(BEGIN VIDEO CLIP)

SANDERS: I think the president and the people of this country should be concerned about the mental fitness of the leader of North Korea. This is a president who's not going to cower down and is not going to be weak and is going to make sure that he does what he's promised to do.

(END VIDEO CLIP)

"Politico" also reporting concerned lawmakers called a Yale University psychiatry professor. Dr. Bandy Lee was on Capitol Hill last month for two days and she warned lawmakers about Trump saying, quote, "He's going to unravel and we are seeing the signs."

She also said lawmakers' level of concern about the president's dangerousness was surprisingly high.

ROMANS: All right. For the fifth time in two days, North Korea has spoken to South Korea on a newly-opened border hotline -- reopened. For two years, that hotline has been quiet and now they're talking.

South Korea reporting no sign of an imminent missile launch by North Korea, although not everyone in the region is calm here.

Will Ripley has reported extensively from North Korea. He has the latest developments for us. He's live from Seoul.

You can see maybe a small, small downshift in the concerns here because they are talking one another, but still, just a dangerous situation, Will.

WILL RIPLEY, CNN INTERNATIONAL CORRESPONDENT: Right, Christine.

I mean, the hope here in South Korea is that North Korea will participate in the Winter Olympics in PyeongChang because they believe that perhaps that will mean that North Korea won't engage in provocative behavior, like a ballistic missile test or a nuclear test right around this very important international event, even though U.S. officials have been indicating for a couple of weeks now that they believe North Korea may be preparing to launch yet another missile. This has been reported by a number of U.S. media outlets, including CNN, citing confidential sources.

Here in South Korea, they are trying to make a point to say that they are not seeing signs of an imminent launch. Maybe wishful thinking, maybe not. They do think that North Korea could really launch a missile pretty much at any time.

We know that Japan's Prime Minister Shinzo Abe spoke out overnight. He believes the situation, right now in this region, is the most dangerous it has been since World War II.

Here in South Korea, we just learned that there will be a meeting between South Korean government officials and Chinese officials about the North Korean nuclear issue.

Of course, China saying they welcome the reopening of this hotline. Although, Christine, they've had five conversations in the last two days and they've only consisted of checking the line to make sure it's stable and the North telling the South that they have no information. So, we'll have to see where it all goes.

ROMANS: Well, it's something, I guess. All right. When just checking the line is news it tells you what kind of a situation we're in.

Will Ripley, thank you so much in Seoul.

Let's get a check on "CNN Money Stream" this morning. It is that time of the morning.

Global stock markets are higher today after chipmakers pushed Wall Street to fresh records. The Dow, the Nasdaq, the S&P 500 all closed at all-time highs. Dow 25,000 is in sight. Just 25 -- well, just about 90 points away.

Tech was the best-performing sector last year.

Computer security experts have found two major flaws that put virtually all computers at risk. The flaws exist in computer chips that could allow hackers to steal the entire memory of desktops, laptops, smartphones, even Cloud servers. Now, Intel and other chipmakers say they're working on the issue. There is no easy fix. The U.S. government warns the chips need to be replaced to fix the problem.

Watch out, Alexa. Roku is working on its own voice assistant. Roku plans to unveil its own smart assistant this fall, debuting on the company's T.V. streaming devices and smart T.V.s in an automatic software update.

Roku is the most popular streaming device in the U.S. Unlike Alexa or Google Assistant, Roku will just control T.V. and music.

All right, there you go at 59 minutes past the hour. That's it for us. Thanks for joining us. I'm Christine Romans.

BRIGGS: I'm Dave Briggs. "NEW DAY" has you covered with the cuck fight or the "Fire and Fury" fallout, day two. We'll see you tomorrow.

(BEGIN VIDEO CLIP)

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: Fists are flying between the president and his former chief strategist, Steve Bannon.

ROMANS: President Trump's lawyer now threatening legal action.

ZELENY: Steve Bannon accused the president's son of treasonous behavior.

SANDERS: The book has a lot of things that are completely untrue.

UNIDENTIFIED FEMALE: It makes him look like everyone around him feels like he's a bumbling idiot and doesn't tell him.

UNIDENTIFIED MALE: They think he doesn't read anything. They think he doesn't know anything.

UNIDENTIFIED FEMALE: He then feels like he has nothing left to lose.

VAN DAM: About 15 states along the east coast of the U.S. currently under some sort of winter weather advisory.

UNIDENTIFIED MALE: The temperatures are going to be extremely cold. In fact, colder than we've seen the last 11 days.

UNIDENTIFIED MALE: If you don't have a reason to be out, don't be out.

(END VIDEO CLIP)