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China Trade Ministry Slams U.S. Tariffs; U.S. Skeptical of Vladimir Putin's Claims of Invincible Nuclear Missile; Aired 4-4:30a ET
Aired March 2, 2018 - 04:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[04:00:14] DAVE BRIGGS, CNN ANCHOR: Turmoil at the White House. Now stretches around the globe. The White House announcing new tariffs on steel and aluminum that could raise prices and kill jobs. The policy is not yet ready, but allies already angry, global stocks tumbling.
(BEGIN VIDEO CLIP)
JOHN KELLY, WHITE HOUSE CHIEF OF STAFF: I miss every one of you every day. I went --
(END VIDEO CLIP)
CHRISTINE ROMANS, CNN ANCHOR: A joke or something worse? Chaos at home shows no signs of letting up. The National Security adviser appears headed out the door and one of Ivanka Trump's business deals is now under the FBI's microscope.
BRIGGS: And a day after appearing to back gun reforms favored by Democrats the president has a surprise sit-down with the NRA. The group now says the president does not want gun control. This a 180 far faster than it was on immigration if in fact the NRA is right. We'll get to that in a moment.
Good morning, everyone. Welcome to EARLY START. I'm Dave Briggs.
ROMANS: I'm Christine Romans. It is Friday. It is Friday, I'll say that twice. It is March 2nd and 4:00 a.m. -- 4:01 in the East.
Big news here. President Trump slapping tariffs on foreign steel and aluminum. A controversial move sparking fears about a trade war. The plan here, impose tariffs of 25 percent on steel, imported steel, and 10 percent on imported aluminum to help those struggling industries.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: When it comes to a time when our country can't make aluminum and steel, and somebody said it before and I will tell you, you almost don't have much of a country.
(END VIDEO CLIP)
ROMANS: Trump gave no further details. In fact he said the policy is still being written and while this decision makes good on his campaign promise to get tough on trade, it has made -- it was made against the wishes of his top advisers. People close to the president, titans of industry. Key Republicans. In fact basically the entire Republican Orthodoxy are against this. And it could bring a host of negative consequences.
Traditional, conventional wisdom is that tariffs are bad for the U.S. economy. "The Wall Street Journal" editorial board slamming this as Trump's biggest policy blunder that will punish American workers, invite retaliation that will harm U.S. exports, divide his political coalition at home, anger allies abroad, and undermine his tax and regulatory reforms.
If you drive a car, fly, drink a can of beer, prices could go up. Anything made with steel or aluminum will become more expensive. Companies would raise prices or cut jobs. In fact a beer industry group predicts this will cost 20,000 jobs.
Now it's not clear if these tariffs will exempt key U.S. allies. So experts think this could spark retaliation especially from China. Farmers in particular worry it could flat tariffs on soy, China is the top climate for U.S. soy. But that damage is all so theoretical. Global stocks are already down very sharply. Asian and European markets falling overnight. Down about, that's the Dow there.
Trump's announcement sent the Dow down 420 points. The Nasdaq and S&P 500 fell 1.3 percent. Shares of plane and carmakers were especially hit hard. Boeing, GM, Ford. Investors do not like uncertainty and I've got to be honest with you, there's a lot of uncertainty about exactly what is the plan here.
BRIGGS: Yes. Just from a process standpoint, it was surprising. Right? Because no one knew this was going to happen yesterday and the way he shocked his own administration.
Republican reaction, just a quick sampling, Ben Sasse from Nebraska. "You'd expect a policy this bad from a leftist administration, not a supposedly Republican one." And Mike Lee calling it a huge job- killing tax hike. Just a few of the Republicans weighing in but the president's tariff talk drawing condemnation from U.S. trading partners around the world as well.
The president of the European Commission denouncing the move as blatant intervention to protect American industries. In just the last few hours China weighing in as well.
Let's go live to Beijing and bring in CNN's Matt Rivers.
Good morning to you, Matt. What's happening overseas? What's the reaction?
MATT RIVERS, CNN INTERNATIONAL CORRESPONDENT: Well, China has weighed in. We're interested in two kinds of China reaction, right? What they said today but also what's going to happen down the road. So we'll get to that in a second but today the Ministry of Foreign Affairs basically slammed this ruling or this proposal from the president, saying it doesn't help, saying it will hurt global trade, saying it will put a dent in U.S.-Chinese relations.
And that's not surprising. That's what we've heard from the Chinese government any time they are asked about potential U.S. protectionist stylist policies. But you heard Christine get into that a little while ago. It's what's going to happen down the road. How, if any way, does China retaliate here? And they have a lot of tools in their tool kit to hurt American companies. So you heard Christine talk about soy, for example. Billions and billions and billions of dollars of American soy is bought by Chinese buyers every single year.
[04:05:05] It's one of the biggest American exports to China. If China decides, hey, we're going to buy soy from Argentina or Brazil instead, that will have an effect on the tens of thousands of U.S. jobs supported by the soy industry, and by the way, most of the jobs are in states that voted for Donald Trump in 2016.
The Chinese government knows that. They know where to apply political pressure points. So maybe that's one avenue they could take. The other thing they can look at? Airplanes, for example. They buy a ton of aircraft from Boeing. Could they restrict market access there?
So the Chinese government has a lot of different ways to retaliate. It knows it can hurt U.S. businesses, U.S. jobs, the question is, will it do that? Only time will tell. But that's something we're going to be watching very closely.
BRIGGS: Interesting, Matt, because China of course is not even in the top 10 of U.S. steel imports. It is 11th on that list. And yet this policy appears aimed at China. We'll check back with you later in the program.
ROMANS: All right. The NRA claims it has the president on its side. After huddling at the White House last night with the president and the vice president, the head of the NRA's lobbying arm Chris Cox tweeting a blunt message after that meeting, insisting both men oppose gun control. Asked if the White House agrees with Cox's statement, a senior official would only say the president, quote, "believes in the Second Amendment."
BRIGGS: Last night's meeting with the NRA follows Mr. Trump's freewheeling meeting with the bipartisan group of lawmakers to discuss gun reform. Some lawmaker at that meeting. Florida congressman and Army vet Brian Mast still believes the president will take action.
(BEGIN VIDEO CLIP)
REP. BRIAN MAST (R), FLORIDA: Well, he said very clearly that if we get him a bill that addresses bump stocks, background checks, and buying age that he's going to sign it.
ANDERSON COOPER, CNN HOST": The NRA met tonight with the president and the vice president. Do you think the president may tack back to his original positions which were more in line with the NRA positions? MAST: I certainly hope not. You know, he's had a great deal of
strength in this issue, you know, telling all the other lawmakers, look, you've got to be strong in this, you can't be afraid. You've got to go with your gut and got to do what you think is right. You can't say that and then walk away from that.
(END VIDEO CLIP)
ROMANS: Many of the president's suggestions at that meeting, that bipartisan meeting, were in line with Democratic positions. Now officials scrambling. Sources say the rollout of new measures to curb gun violence will not be released today as planned. Majority leader Mitch McConnell says the Senate will take up a banking bill next week dashing hopes of quick action on guns in the wake of the school shooting in Florida.
And remember, the president said there were a lot of common sense things that he could be done that he personally would do. He would write out bump stocks. He said we should raise the age of buying weapons to 21. He said that people who were mentally ill, they should have their guns taken away before there is due process. He was specific, the president was, on his plans. He huddled with the NRA, maybe those ideas went away.
Chances are you are happy it's Friday. I am. Now imagine how happy you'd be if you worked at the White House? The Trump administration struggling to turn a corner after a chaotic week. CNN has learned that National Security adviser H.R. McMaster is set to leave by the end of the month. The West Wing is denying his departure is coming soon, but multiple sources say it is likely McMaster will retire as a three-star general instead of returning to the military. Two sources say McMaster has spoken to top officials at the Hoover Institution about a job there.
BRIGGS: Sources also telling CNN one of Ivanka Trump's international business deals is under scrutiny from U.S. counterintelligence officials. The FBI looking into Trump International Hotel and Tower in Vancouver. It's one of the few Trump branded properties to open since the president took office so the timing of the negotiations and most importantly financing for the deal could be of special interest. FBI attention could create a hurdle for Ivanka as she tries to obtain permanent security clearance.
ROMANS: A spokesman for the first daughter's ethics counsel claims no red flag or problem has been raised with her clearance application. This on the heels of reports several countries discussed ways to use Jared Kushner's business deals to manipulate him and that his family real estate got half a billion dollars in loans after lenders met with Kushner at the White House.
BRIGGS: Another sign of turmoil, CNN has learned the president was fuming after Attorney General Jeff Sessions pushed back against him with the statement defending his own integrity and honor. It was a rare gesture of defiance after the president called Sessions disgraceful in his latest Twitter tirade. And asked about Sessions, Press Secretary Sarah Sanders did not exactly give a ringing endorsement here.
(BEGIN VIDEO CLIP)
UNIDENTIFIED REPORTER: Does the president want to get rid of the attorney general?
SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: Not that I know of.
(END VIDEO CLIP)
ROMANS: After nearly a week of this drama, White House Chief of Staff John Kelly vented a little at a Homeland Security event.
(BEGIN VIDEO CLIP)
KELLY: I miss every one of you every day. I went --
(LAUGHTER AND APPLAUSE)
KELLY: Truly, six months, the last thing I wanted to do is walk away from one of the great honors of my life, being the secretary of Homeland Security, but I did something wrong and God punished me, I guess.
(END VIDEO CLIP)
[04:10:11] ROMANS: Just a joke. Trump allies in Washington describe a feeling of meltdown at the White House. They say the president wants to do something to turn the tide, but it is not exactly clear what that would be.
BRIGGS: The U.S. is looking for a new ambassador to Mexico. Roberta Jacobson announcing she is stepping down in May in search of other opportunities. Jacobson is a seasoned diplomat who was nominated to the position in 2015 by then President Barack Obama.
Now relations with Mexico have been strained over trade and the border wall. Jacobson ending her announcement written in Spanish by declaring -- we are stronger together. Last weekend, Mexican President Enrique Pena-Nieto called off an official trip to Washington after a tense phone call with the president.
Ahead, U.S. officials say they're skeptical about Vladimir Putin's claim to have a missile so powerful it can penetrate NATO defenses. We're live with the latest in Moscow.
(BEGIN VIDEO CLIP)
[04:15:13] GEN. MICHAEL HAYDEN, FORMER CIA DIRECTOR, FORMER NSA DIRECTOR: Let's not hyperventilate over this. He's got some weapons that I think our Department of Defense knew he was developing. All right? And some of them may be, as he suggested, further along than others. But I don't think any of them, even if they were fully operational changes the strategic equation, the strategic balance between us and the Russians.
(END VIDEO CLIP)
BRIGGS: That's former CIA and NSA director General Michael Hayden. He and several other intelligence experts expressing skepticism about Vladimir Putin's claims of resurgent Russian military might. One U.S. official calling Putin's announcement, quote, "cheesy" insisting U.S. defense and military capabilities remain second to none.
ROMANS: The Russian leader claiming his country has developed invincible nuclear weapons systems with unlimited range, can't be tracked. Mr. Putin's address featuring video clips of nuclear warheads hitting Florida. The site of President Trump's Mar-a-Lago estate. Top U.S. officials un-amused, also unconvinced.
Let's go live to Moscow and bring in CNN's Matthew Chance.
And Matthew, frankly, this was meant for his domestic audience. Right? I mean, he is trying to build up the narrative of his own military just as in the United States, Donald Trump, the president here, is talking about the American military.
MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes, exactly. I think that was the primary audience for this speech. It was made at the Joint House of the Russian parliament here in Moscow. And what was domestic, he is in a political season here. Vladimir Putin in just 16 days from now, he's facing reelections. He's certain to win that election hands down. But he still wants to take these opportunities to project himself as a strong president, a strong leader who's very mindful of the U.S. -- of the Russian military, rather, and has national security on his mind much as you say President Trump likes to present himself as well.
But undoubtedly he was also messaging the West and his adversaries in the United States. And I don't think it's a coincidence that Florida was chosen as the hypothetical potential target for these new invincible missiles that he was showing in that computer -- computer sort of generated display thing that he put out. You know, but at the same time, again, you know, messaging the West, yes, but this was a political speech first and foremost. A chest thumping political speech here in Moscow.
ROMANS: Is there any suggestion that there is actually science and technology behind these missiles that they exist?
CHANCE: Well, those doubts that have been raised in the U.S. have not been raised here. People tend to take at face value what the president says I think to a larger extent. You know, and of course, you know, there's no doubt people in this country that they are working behind the scenes to develop new technologies to try and get one-up on their adversaries.
The criticism that's been raised here which I think is interesting is that, you know, why is Russia -- why is the president projecting itself as this threat to the West at a time when it should be focusing on the economy and trying to attract foreign investment? This could backfire is the criticism in the Russian press about the speech.
ROMANS: All right. Matthew Chance, thank you so much that.
You know, the president of the United States not tweeting on this. He tweets about North Korea and its threats often, but nothing from the president on this.
BRIGGS: Not yet.
All right. Ahead, a very ugly day for millions along the East Coast. Rain, dangerous wind, snow, possible flooding, flight cancellations already building up. The nor'easter forecast is next.
[04:23:09] ROMANS: A nor'easter today and tomorrow with much cooler temperatures and a coastal flooding threat. The Massachusetts town of Scituate is urging coastal residents to evacuate. The National Guard has been activated to assist as many as people need help in the state. Nearly 1500 flights already cancelled for today so no matter where you are, check your flight listing before you go to the airport.
Meteorologist Derek Van Dam with the soggy weekend forecast.
DEREK VAN DAM, AMS METEOROLOGIST: Our nor'easter is well under way across New England. In fact, we'll feel the impacts of the storm for the next 36 to 48 hours. Strong gusty winds, heavy rain, heavy snow, coastal erosion and power outages all possible with the system. And in fact, the strongest parts of the storm will coincide with multiple high tides.
That's why we have coastal flood warnings where you see that bright shading of green with flood watches in effect for many of the coastal areas as well. We have a winter storm warnings for upstate New York. Upwards of a foot or more of snow by this time as storm is all said and done.
And then on top of that, we have tropical storm force winds with gusts near hurricane force, especially along the coastal area. So look out Boston, all the way to Long Island. In fact, D.C., Philly, New York and into Boston, you have an extremely windy next 24 to 36 hours ahead of you.
Here's the snowfall totals. You can see, they'll be highest across the Catskills. We keep temperatures warm enough to keep the precipitation in liquid variety for New York, as well as D.C. Temperatures today for the Big Apple 42 degrees.
Back to you.
BRIGGS: A lovely day here. Derek, thank you.
New flu numbers expected this morning from the CDC. This just brutal flu season has claimed the lives of thousands including 97 children. Flu activity is finally slowing down, though. Now scientists are taking new steps to prevent future outbreaks.
ROMANS: The National Institute of Health are hoping to have a holy grail vaccine ready within five years.
[04:25:03] Right now the flu vaccine's composition is reviewed every year. It's updated as needed which requires guesswork frankly. The head of vaccine research at the NIH calls that system antiquated and says a universal flu vaccine is now a top priority.
BRIGGS: There is surge pricing then there's passed-out drunk pricing. Kenny Bachman was partying with friends last Friday in Morgantown, West Virginia. Afterward local reports say he ordered an Uber to take him back to where he was staying near West Virginia's campus. But when he woke up in the car, he was headed to New Jersey, more than 300 miles away.
The price tag for the ride? More than $1600. It turns out it was extra expensive because Bachman accidentally ordered an Uber XL, which can carry six passengers. Bachman challenged the charge claiming he never entered his home address for the Uber. But after talking it over with Uber Bachman ultimately agreed to pay the fare.
ROMANS: It's all right there. It's all documented. You know? Like you ordered the Uber XL. You put in your address.
BRIGGS: It's tough. That is an expensive bar tab, folks. $1600.
ROMANS: Wow. Buyer beware.
BRIGGS: Imagine that hangover.
ROMANS: Buyer beware. All right. The "Wall Street Journal" calls it the biggest policy blunder of Donald Trump's presidency. The new plans for tariffs, but no plan yet to actually announce. Global stocks are down as the week of White House chaos expands to our trading partners.