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EARLY START

Wray Clashes with Trump Over Nunes Memo; Another Loyalty Request; North Korean Athletes Arrive in South Korea. Aired 4:30-5a ET

Aired February 1, 2018 - 04:30   ET

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


(COMMERCIAL BREAK)

[04:30:46] RENE MARSH, CNN ANCHOR: Amid a standoff with the president and the FBI, new questions are being raised about a Republican memo that alleges abuses at the FBI. We know the document was changed after the Intel Committee, I should say, voted to publicly release it.

DAVE BRIGGS, CNN ANCHOR: Did the president once again blur the lines on loyalty with law enforcement? CNN has learned that Mr. Trump asked the deputy attorney general if he was, quote, on my team. Boy, does that State of the Union speech feel like months ago, doesn't it?

MARSH: It does.

BRIGGS: And it is February 1st. Welcome back to EARLY START, everybody. I'm Dave Briggs.

MARSH: And I'm Rene Marsh. It's 31 minutes past the hour.

And an escalating feud with the FBI and president over the classified memo which the president could release as soon as today. FBI Director Christopher Wray clashing very publicly with the president over the memo pushed by Republican Devin Nunes, chairman of the House Intel Committee. Wray issuing a warning expressing grave concerns about material omissions of fact that fundamentally impact the memo's accuracy.

BRIGGS: The comments from President Trump's own FBI chief coming after two days of private talks where top Justice Department officials tried to convince the White House not to release the memo. Here is Chief of Staff John Kelly on the document's release.

(BEGIN VIDEO CLIP)

JOHN KELLY, WHITE HOUSE CHIEF OF STAFF: Our national security lawyers in the White House that work for me, work for the president, they are slicing and dicing it and looking at it so that we know what it means.

UNIDENTIFIED MALE: Did you see it?

KELLY: I did.

UNIDENTIFIED MALE: What do you think?

KELLY: It will be released pretty quick I think and the world can see it.

(END VIDEO CLIP)

BRIGGS: President Trump was overheard after the State of the Union telling a Republican Congressman he will, quote, 100 percent release the memo as we learned the following morning the president had not yet read the memo when he said that.

MARSH: Well, Chairman Nunes now accused of secretly making changes to the classified memo. The ranking Democrat on the House Intel Committee, Adam Schiff, says Nunes sent a memo to the White House that was, quote, materially different than the one the committee approved along party lines.

BRIGGS: Congressman Schiff now demanding the committee vote again on whether to release it. The Nunes spokesman does not dispute changes were made, but only how significant they were. He says, quote, in this increasingly strange attempt to thwart publication of the memo, the committee minority is now complaining about minor edits to the memo, including grammatical fixes and two edits requested by the FBI, by the minority themselves.

MARSH: But what is not clear this morning is exactly what changes were made. Why Schiff's staff pushed to check for changes and whether the White House had any hand in those changes.

BRIGGS: Nunes refused to tell colleagues whether his staff spoken to the White House. Democratic Committee member Mike Quigley tells CNN he does not believe Nunes was being candid.

(BEGIN VIDEO CLIP)

REP. MIKE QUIGLEY (D-IL), HOUSE INTELLIGENCE COMMITTEE: He is with a few staff, I think, acting as an agent for the White House and has for an entire year. This is the president of the United States acting to defend himself legally and politically at the expense of our national security, and complicit in that is the speaker of the House and Chairman Nunes.

(END VIDEO CLIP)

MARSH: Well, last year, Nunes was forced to temporarily step aside from leading the Russia investigation, after it was revealed he secretly went to the White House to review classified evidence.

BRIGGS: Before Congressman Schiff leveled his accusations, he wrote an op-ed on "The Washington Post", arguing the Nunes memo crosses a dangerous line. Schiff asked why Paul Ryan has not stepped in, suggesting the House speaker lacks the courage to stop Nunes. Schiff writes, quote, Ryan seems not to understand the central bargain underpinning the creation of the intelligence of committees after Watergate in exchange of the intelligence community's willingness to reveal closely guarded national secrets to a select group of members and staff for the purposes of oversight. The committees and the congressional leadership pledge to handle that information responsibly and without regard to politics. [04:35:01] MARSH: Well, Congressman Nunes is also a key figure in

another episode of President Trump apparently asking for loyalty from an FBI official. CNN reporting exclusively Deputy Attorney General Rod Rosenstein visited the White House in December to ask the president for help fighting off document requests from Nunes. Mr. Trump wanted to know where the special counsel's Russia investigation was heading. Our sources tell us that the president also asked Rosenstein if he was, quote, on my team.

BRIGGS: We're told the deputy attorney general was surprised by the president's question and responded, of course. We're all on your team, Mr. President.

That conversation could raise further questions about whether the president was seeking to interfere in the investigation by special counsel Robert Mueller. No comment from the Justice Department or the White House.

MARSH: Well, now, the special counsel Robert Mueller, he is training his sights on White House communications director Hope Hicks and her role in the aftermath of the Trump Tower meeting between senior campaign aides and a Russian lawyer. "The New York Times" reporting this morning that Hicks allegedly told President Trump on a conference call that e-mails by Donald Trump Jr., quote, will never get out. The e-mails proved the purpose of the meeting with the Russians was to, quote, get dirt on Hillary Clinton.

BRIGGS: Three sources tell "The Times" that former Trump legal spokesman Mark Corallo was concerned that Hicks could be thinking of obstructing justice. Corallo plans to tell the special counsel all about the call. Hicks lawyers denied she ever said that or suggested the e-mails would be destroyed.

MARSH: Will an FBI agent removed from Robert Mueller's Russia probe actually played a role in the series of events that may have cost Hillary Clinton the election? Peter Strzok was removed from Mueller's team after the anti-Trump texts he wrote. But e-mails obtained by CNN show he wrote what appears to be the first draft of James Comey's letter informing lawmakers that the FBI was investigating newly discovered Clinton e-mails just days before the 2016 election.

BRIGGS: According to a source, Strzok supported reopening the Clinton investigation once the e-mails were discovered, but had reservations about Comey making a public announcement so close to election day. This new information painted a more complicated picture of Strzok. Republicans have framed text messages between Strzok and FBI lawyer Lisa Page as showing their intent to go easy on Hillary Clinton.

MARSH: Well, another day, another retirement, another prominent Republican House member Trey Gowdy is calling it quits. The South Carolina congressman who chairs the Oversight Committee says he will not run for a fifth term. A former federal prosecutor, he says he plans to return to the justice system. There has been a spike of Republicans headed for the exits ahead of the midterm elections.

At least 38 have announced they are leaving their seats. Unlike many of his Republican colleagues, Gowdy was not facing a tough re-election campaign. Democrats need to pick up 24 House seats in November to retake the majority.

BRIGGS: The GOP retreat in West Virginia going on as planned today after a train carrying dozens of Republican lawmakers hit a truck Wednesday. The driver of that vehicle was killed. Four people remain in the hospital. All members of the Congress and their family members on the train are OK.

Minnesota Congressman Jason Lewis was taken to the hospital for a potential concussion. The NTSB said it's sending a go-team to the scene to investigate what happened.

The president will make remarks at the retreat today.

MARSH: Well, President Trump has decided not to do a Super Bowl interview this weekend. Sources at NBC say that the White House has rejected their interview request, but they say the president still has an open invitation if he changes his mind.

A pre-Super Bowl sit-down with the commander in chief has become tradition over the past decade when FOX televised the game last year, Mr. Trump was interviewed by then FOX anchor, Bill O'Reilly.

BRIGGS: All right. A check on CNN Money now. Janet Yellen's time as the head of the most influential world central bank is over. Yellen was the first woman to run the Fed Reserve. The replacement, Jerome Powell, begins his four year term Saturday. Powell inherits a healthier economy than his predecessor. Janet Yellen jump-started the economy while dealing with low inflation.

Powell faced the opposite. The Fed expects inflation to speed up this year and it will have to raise interest rates to keep it in check. At Yellen's final meeting yesterday, the Fed keep rates steady but signaled it will boost an interest rates next month. The Fed has penciled in three hikes this year. Interest rates affect borrowing costs. Raising rates on things like mortgages, auto and student loans, as well as savings accounts.

[04:40:02] Ahead, the Winter Olympics are eight days away. Activity in Pyeongchang overnight, including the arrival of North Koreans. We're live at the site of the Olympics next.

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BRIGGS: North Korea athletes arriving in South Korea ahead of the Winter Games which kickoff in a little more than a week. It is being closely watched as observers hope for a potential breakthrough in the tensions engulfing the Korean peninsula.

Our Paula Hancocks, part of the CNN team covering the games from Pyeongchang. She joins us live.

Hi there, Paula.

PAULA HANCOCKS, CNN INTERNATIONAL CORRESPONDENT: Well, hi, Dave. They are officially here now.

The final North Korean athletes have touched down at airport just about 50 miles away from here. Now, it's very unusual for the flight to go from North Korea to South Korea. We are only 50 miles from the demilitarized zone between North and South Korea.

[04:45:04] And yet, there are simply no flights. Still two countries technically at war. But we are seeing a very different situation ahead of this Pyeongchang Winter Olympics.

So, we understood there were going to be 32 members of the delegation that were going to land. There were going to be ten athletes, three coaches, and 18 supporting staff. We haven't seen images yet of them arriving, hoping to see those very soon.

And there are also a number of women's ice hockey team players who have been here since last week. They are training with the South Koreans because they're going to have a joint women's ice hockey team in these Olympics.

So, a lot of excitement here in Pyeongchang, certainly from the officials, from the President Moon Jae-in who wanted North Korea to be involved. He billed it as the Peace Olympics. We are being told it will be the biggest Olympics ever. The U.S. as well is going to have more athletes than any team in any winter Olympics.

So, it is going to be a significant Olympics, we're being told, by the South Koreans. The very fact that they have the North Koreans is part of this makes it important for the officials who pushed so hard for this.

BRIGGS: Yes, it should be some unique optics at those opening ceremonies. Paula Hancocks live for us, thank you.

MARSH: Well, the U.S. conducted a key ballistic missile defense test in Hawaii on Wednesday and it failed. The Pentagon is not commenting, but several officials confirmed a missile failed to intercept the incoming target. Defense officials are trying to determine what went wrong.

The missile being tested is designed to intercept the type of missile North Korea is threatening to launch against the United States. The trial was also designed to test new defense concepts with the missile launched from shore rather than a Navy warship.

BRIGGS: Homeland security officials announcing the temporary protected status of some 7,000 Syrian nationals in the U.S. is being extended for another 18 months because of the ongoing civil war in the country. Protections for Syria were first enacted in 2012. They shield recipients from deportation while authorizing them to work in the U.S. Syrians who arrived here after August 2016 will not be eligible for the extension. It is the first time since protections were created for Syrians that new immigrants cannot apply.

Ahead, Mark Zuckerberg working to fix Facebook, but that's hurting Facebook's numbers. Investors are not happy. CNN "Money Stream", next.

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[04:52:00] MARSH: Well, the director of the Centers for Disease Control and Prevention resigning in the midst of a deadly nationwide flu outbreak. Dr. Brenda Fitzgerald stepping down one day after "Politico" reported she purchased tobacco stock after taking the position. That kind of investment is clearly at odds with the CDC's mission.

According to "Politico", Dr. Fitzgerald also invested in pharmaceutical companies Merck and Bayer, as well as health insurance company Humana.

BRIGGS: The Justice Department filing to dismiss all charges against Senator Bob Menendez. An 11-week corruption trial last fall resulted in a hung jury for the New Jersey Democrat. Prosecutors accused the senator of accepting bribes from Salomon Melgen, a wealthy Florida ophthalmologist in exchange for political favors. Charges against Dr. Melgen also dropped. Menendez expressing gratitude to the Justice Department for reevaluating his case and coming to, quote, the appropriate conclusion.

MARSH: Well, a Polish-born doctor detained by immigration officials after living in the United States for nearly 40 years. He is expected to be released today on $10,000 bond. Dr. Lukasz Niec was taken into custody by ICE agents in mid-January. The Michigan doctor was 5 years old when his parents fled Poland in 1979. He received a temporary green card and became a lawful resident. Dr. Niec originally came under scrutiny because of 18 encounters with police, most of them traffic violations. One child abuse claim against him was investigated and found to be unsubstantiated. His family has launched a legal fight to keep him in the United States.

BRIGGS: San Francisco will immediately dismiss all misdemeanor marijuana convictions dating back to 1975. The city district attorney says the decision stems from the provision in the California law that just legalized recreational marijuana. Officials also plan to review all marijuana felonies reported that same time period and appropriate sentence resentence them as misdemeanor offenses. The move affects thousands of people, but doesn't happen automatically. A person convicted of a marijuana crime must petition a court to have their record change.

MARSH: Well, FEMA is trying to ease concerns of Puerto Ricans alarmed by the decision to halt new shipments of food and water to the island. The agency is stressing it is not planning to leave or stopped handing out crucial supplies. FEMA has stockpiled 46 million liters of water and 4 million meals and snacks and distribution they say will continue. The supplies should hold out, it says, until normalcy continues or returned. Many Puerto Ricans, though, are still dependent on FEMA's aid and some are skeptical that the agency stockpiles will be enough.

[04:55:01] BRIGGS: Former First Lady Michelle Obama reliving an awkward moment. In her first television interview since leaving the White House, she explains to Ellen DeGeneres what she was thinking when First Lady Melania Trump handed her the blue tiffany box on President Trump's inauguration day.

(BEGIN VIDEO CLIP)

MICHELLE OBAMA, FORMER FIRST LADY: There is all of the protocol. I mean, this is like a state visit. So, they tell you, you're going to do this. They're going to stand here and never before do you get this gift.

So, I'm sort of like, OK. What am I supposed to do with this gift? Everyone cleared out. No one would come and take the box. I'm thinking, do I take the picture? And my husband saved the day. He grabbed the box and took it back inside.

(END VIDEO CLIP)

BRIGGS: She said inside the package was a lovely picture frame. The full interview with Mrs. Obama airs today on "Ellen."

MARSH: I love that story.

BRIGGS: It was an awkward moment.

MARSH: Yes, it certainly was.

And another arctic blast blowing across the East Coast today with temperatures more than 15 degrees below normal.

Meteorologist Derek Van Dam joins us live now from the weather center.

Good morning, Derek.

(BEGIN VIDEOTAPE)

DEREK VAN DAM, AMS METEOROLOGIST: Good morning, Dave and Rene.

Here is a good indication that winter is not yet over. You can see across the eastern half of the country below average temperatures from the Climate Prediction Center from February 5th through February 9th with above average temperatures across the western half of the U.S. once again. This is all thanks to a cold front that is sliding eastward, allowing a blast of arctic air. There is some rain and snow associated with the system, but it will stay mainly liquid across the major cities of East Coast, New York and Washington this afternoon.

Check out those deep, dark red and purples coming in from Canada. That means temperatures will drop. Today, 23 for Chicago, 45 in the Big Apple, 54 for the nation's capital. But look at the nose dive into the weekend. Temperatures barely squeaking above freezing for New York City.

Of course, we've got Groundhog Day taking place tomorrow. Punxsutawney Phil -- well, will he or will he not see his shadow? One thing is for sure, it will be 23 degrees when he comes out of his burrow. I go back in if I was him. Back to you.

(END VIDEOTAPE)

BRIGGS: Me too, Derek.

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

Global markets and U.S. futures are mostly higher today after Wall Street rebounded from a two-day sell off, giving up big early gains to close slightly higher. The concern, interest rates. The Federal Reserve left rates unchanged, but signaled it will boost them next month. The Central Bank have penciled in three hikes this year. Investors worry the era of low interest rates may be coming to an end.

It's a case of chicken collusion. Two lawsuits accuse the largest poultry producers of working together to jack up prices. The suits were filed by two major food distributors, Sysco and U.S. Foods. They accuse 17 different companies, including Tyson, Pilgrim's Pride and Perdue, of price fixing, working together to both restrict the supply of chickens and manipulate prices. The 17 companies control 90 percent of the chicken market. The two largest, Tyson and Pilgrim's Pride issued statements denying the allegation.

Mark Zuckerberg working to fix Facebook, but that's hurting Facebook's numbers. Users spent 50 million hours less per day on Facebook mainly due to fewer viral videos in the newsfeed. And its daily users declined for the first time ever. That sent stock down 5 percent. But it rebounded after execs reassured investors that its ad business was still making money.

Facebook faces harsh criticism for enabling fake news and foreign election meddling. It is working to prove to have a positive affect on society, for example, by showing more content from your friends and rating news sources.

Of course, friends is very loose in Facebook because the vitriol and hateful political rhetoric on Facebook -- Mark Zuckerberg can't control it but it has gotten to a nasty level.

MARSH: Yes, people not going on as much, as they used to.

BRIGGS: Yes, me neither.

MARSH: EARLY START continues right now.

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MARSH: Amid a standoff between the president and the FBI, new questions being raised about a Republican memo that alleges abuses at the FBI. We know the document was changed after the Intel Committee voted to publicly release it.

BRIGGS: Did the president once again blur the line on loyalty with law enforcement? CNN has learned the president asked the deputy attorney general if he was, quote, on my team. Boy, does that new American moment promised in the State of the Union feels like years ago.

Good morning, everyone. Welcome to EARLY START. I'm Dave Briggs.

MARSH: And I'm Rene Marsh. It is Thursday, February 1st. It is 5:00 a.m. in the East, 7:00 p.m. in Pyeongchang, where things are starting off this morning, that is where the Olympics --

BRIGGS: Yes, right on the edge of the Olympics. Are you excited?