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EARLY START

President Ready To Replace H.R. Mcmaster; Mueller Subpoenas Trump Organization Documents, New Sanctions Against Russia Announced; Russia Will Expand American Blacklist; 'Recover Operation' At Miami Bridge Collapse, Four Killed; Trump's Comments Rattle S. Korea. Aired 4:30-5a ET

Aired March 16, 2018 - 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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[04:30:20] ALISON KOSIK, CNN ANCHOR: President Trump is shopping around for a new National Security Advisor and he'll replace H.R. McMaster when he finds one.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Is Putin a friend or a foe of the United States?

SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: I think that's something that Russia's going to have to make that determination.

(END VIDEO CLIP)

DAVE BRIGGS, CNN ANCHOR: The White House thinks soft on Russia despite finally levelling new sanctions. Overnight, Russia punches back against those new measures.

KOSIK: And what caused a deadly pedestrian bridge collapse at Florida International University? Four people are dead and search efforts are now focusing on recovery. We're going to get a live update from officials in 30 minutes.

BRIGGS: Such a devastating story, isn't it?

KOSIK: I know. It really is. Welcome back to Early Start. I'm Alison Kosik. Good morning.

BRIGGS: I'm Dave Briggs. It's 30 minutes past the hour. Thanks for being with us here on a Friday. We start with The White House and after weeks of speculation President Trump ready to replace his National Security Advisor, Lieutenant General H.R. McMaster. Two sources telling CNN the President has not made a final decision on who will replace McMaster and the timing is unclear. One source says any delay stems from McMaster trying to finalize his next steps.

KOSIK: Trump has privately expressed irritation with McMaster's personality and style. Late last night, The White House pushed back against reports of the change. Press Secretary Sarah Sanders tweeting this, "Contrary to reports, the President and McMaster have a good working relationship and there are no changes at the National Security Council".

For his part, Trump yesterday called reports of impending staff changes, "exaggerated and very false". Listen.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I've gotten to know a lot of people over the last year. You know, I've been in Washington for a little bit more than a year where some people have been here for 30, 40 years. I've gotten to know great people. So there'll always be change, but very little.

It was a very false story. It was very -

(END VIDEO CLIP)

BRIGGS: The President has signalled he is prepared to get rid of aids he's clashed with. Sources say, after a year in office, Mr. Trump has become more self-assured and is starting to trust his gut more.

KOSIK: In the latest sign that Russia - the Russian Investigation is picking up steam, a source tells us that Special Counsel Robert Mueller has subpoenaed the Trump Organization for business documents. "The New York Times" reporting the subpoena includes records related to Russia. This marks the first known instance of Mueller demanding documents connected to President Trump's businesses.

BRIGGS: We should note that the Trump Organization has already turned over a wide range of documents voluntarily. Our source says the subpoena is meant to, quote, "clean up and ensure all related records are handed over". The President said any investigation of his or his family's personal finances would cross a red line. Jeff Zeleny asked White House Press Secretary Sarah Sanders about just that.

(BEGIN VIDEO CLIP)

JEFF ZELENY, CNN SR. WHITE HOUSE CORRESPONDENT: Does the President still believe - does he draw a distinction, do you know, between a red line on family finances separately from family finances or business finances relating to Russia as it pertains to this case?

SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: The President believes very strongly there was no collusion between the Trump campaign and Russia. We're going to continue to cooperate with the Special Counsel and for questions specific to the Trump Organization, I would refer you to them.

(END VIDEO CLIP)

BRIGGS: All right. An attorney for the Trump Organization said in his statement that the latest report are, quote, "old news".

KOSIK: Reports of Mueller's subpoena came after the Trump administration announced it is finally imposing new sanctions on Russia, including against people the Special Counsel indicted last month. The administration is six weeks late meeting a congressional mandate to impose punishments on Moscow for it's 2016 election meddling. The White House also lodging a new accusation against the Kremlin that Russian Intelligence tried to hack the U.S. energy grid. In total, the new sanctions apply to 19 individuals along with five companies and government agencies.

BRIGGS: Remember, those were passed 98 to 2. Among those sanctions, the Internet Research Agency, the Russian troll farm, that cranked out divisive political posts on Facebook, Twitter and other social media sites. Two Russian intelligence agencies and some of their employees also on the list. After the administration announced the sanctions, Press Secretary Sarah Sanders still would not say whether the Kremlin is an ally or an adversary.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Is Putin a friend or a foe of the United States?

SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: I think that's something that Russia's going to have to make that determination. They're going to have to decide whether or not they want to be a good actor or a bad actor. I think you can see from the actions that we've taken up until this point, we're going to be tough on Russia until they decide to change their behavior.

(END VIDEO CLIP)

BRIGGS: Senior International Correspondent Fred Pleitgen joining us live from Moscow. Good morning to you, Fred. If the Kremlin's Press Secretary were asked that question, what do you think would be the answer?

FREDERIK PLEITGEN, CNN SR. INTL. CORRESPONDENT: Yes. Well, I think it would be pretty much exactly the same answer, Dave.

[04:35:07] I think he would blame the U.S. for the current state of U.S.-Russian relations and say, it's up to Washington to improve them. And I think if he were asked if the U.S. at this point were a friend or a foe, he would probably say that the Russians right now consider the U.S. to be an adversary. However, they don't consider President Trump to be an adversary.

It's been very interesting, especially since the election in 2016, but the Russians have said it's all the U.S. that's causing the relations to get worse and worse. However, they consistently take President Trump out of the equation and don't mention him when they say - talk about the reasons why those relations have become so bad.

And it's pretty much the same thing right now with these new sanctions by the Treasury. The Russians have already said they are going to retaliate. They said they're going to expand, what they call, their "black list of Americans". However, they've not said how, exactly, they're going to do that, how many people they're going to add to that.

They also say that, with these new sanctions by the Treasury, they're very calm in the face of them. They don't seem to take them very serious. And if you look at the list, for instance, that Internet Research Agency, the troll factory, that did so much damage during the U.S. - or in the run up to the U.S. election, that doesn't even exist as a legal entity here in Russia anymore.

And then you have the main guy on the Treasury list. His name is Evgeniy Prigozhin. He came out and he said he couldn't care less about these new sanctions and he said the only thing that he would do, is he would stop eating at McDonald's, Dave.

BRIGGS: Some really punishing sanctions there, indeed. Fred Pleitgen, that is great reporting.

KOSIK: Clearly you mean that sarcastically.

BRIGGS: Yes. Dieting (ph).

KOSIK: A scathing indictment of the Republican party from one of its own senators. Jeff Flake of Arizona making the argument the GOP might not deserve to run the country because of its support for President Trump. He's been calling for a more civilized political discourse throughout much of the Trump presidency.

(BEGIN VIDEO CLIP)

SEN. JEFF FLAKE (R), ARIZ.: If my party is going to try to pass off the degradation of the United States and her values from The White House as normal, if we're going to cloister ourselves in the alternative truth of an erratic leader, if we are going to refuse to live in the world that everyone else lives in and reckon with the daily reality that they face, then my party might not deserve to lead.

(END VIDEO CLIP)

BRIGGS: Might not deserve to lead. Flake is not seeking re-election but he may have his eye on 2020. The Senator is the featured speaker today at the latest installment of the Politics and Eggs Breakfast in Manchester, New Hampshire. Flake says a presidential bid is not in his plans, but he's not ruling it out.

KOSIK: Search efforts at the scene of a deadly pedestrian bridge collapse in Miami transitioning overnight from rescue to recovery. A 15 member Go-Team from the National Transportation Safety Board is trying to determine what went wrong. At least four people died when the brand new bridge fell into a busy intersection near the campus of Florida International University in Miama.

BRIGGS: Senator Marco Rubio tweeting overnight, "The cables on the bridge had loosened and were being tightened when the collapse occurred". Here's Florida Governor, Rick Scott.

(BEGIN VIDEO CLIP)

GOV. RICK SCOTT (R), FLA.: We will hold anybody accountable if anything - if anybody's done anything wrong. But the most important thing we can do right now is pray for the individuals that ended up in the hospital, for their full recovery, pray for the family members that have lost loved ones. But I know we're going to all want do our best to try to find out exactly what happened here.

(END VIDEO CLIP)

BRIGGS: Two other people are in extremely critical condition this morning, victims of a structure that was designed to last a century and withstand the force of a Category 5 hurricane. CNN's Dianne Gallagher in Miama with the latest.

DIANNE GALLAGHER, CNN NTL. CORRESPONDENT: You know, Dave, Alison, these crews worked through the night. They said they're going to go around the clock. We're talking about 100 emergency workers here. The Fire Chief did say late last night that they had found the bodies of at least four people in the rubble, but at this point they don't really know how many people could still be in that. They're searching and it's not going to be a quick process here. These are very large, heavy pieces of concrete that they have to remove very carefully.

Because it is Spring break here at Florida International University, this could have been much worse. This bridge was put into place just yesterday. This is $15 million project that had been being built sort of to the side of the road. They swung it into place with a big rig in a matter of about six hours installing it and while it was still under construction.

This is something the University was very proud of. The community and the engineers who built it, very proud of, and had been looking forward to for a long because it was a way to make it safer for the students and staff so they didn't have to cross a very busy six lane highway to get to where they lived in the Sweetwater community.

They're trying to figure out now, what caused this 950 ton bridge, of course, to fall onto the highway. Alison, Dave.

KOSIK: OK. Our thanks to Dianne Gallagher for her report.

[04:40:06] Defense official says there are likely fatalities in the crash of a U.S. military helicopter in Iraq. Officials saying it happened right near the Syrian border. The Pave Hawk helicopter, a variation of a Black Hawk. It was carrying seven crew members. It was not on a combat mission and defense officials say earlier reports do not indicate hostile fire. The cause is under investigation. Of course, we're going to bring you more information as soon as we get it.

BRIGGS: Coming up, a happy reunion. A German Shepherd accidently shipped to Japan instead of Kansas, back with his owner this morning. More on that next.

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[04:45:00]

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KOSIK: Welcome back. Banks are raking in record profits, but claim over regulation is holding them back. It's been 10 years since the financial crisis but Congress is looking to roll back the rules adopted in its wake. The Senate just passed a bill repealing parts of Dodd-Frank, loosening rules on community banks, regional lenders, and mortgage companies.

Strict regulations, they say, stifle lending, but banks aren't exactly starving here. The industry made a record profit last year, $164.8 billion, and that was before tax cuts which will juice profits even more. In fact, banks have so much cash, it returned a ton to shareholders. U.S. banks paid $121.4 billion in dividends in 2017. That's the highest amount on record. That fact makes it tough to argue that banks don't have enough to lend.

Now, it is true, though, a Wall Street bank like Citigroup is different from the small community bank. However, even they are doing better. Fourth quarter profits from community banks soared 17 percent.

BRIGGS: Wow, big number there. All right. Some students who walked out of class this week to demand tougher gun control laws are finding out free speech comes with a price. South Carolina's largest school district issuing reprimands to over 500 students for cutting class. More than 200 others in Allentown, Pennsylvania slapped with Saturday detentions. In Cobb County, Georgia, students who walked out face potential five day suspensions.

KOSIK: At Park Hill High School in Kansas City, the kids can either attend a half hour detention after school next week or face a disciplinary meeting after Spring break. And at Lindenhurst High in New York, students were given three days of after school detention. That punishment rescinded after a last minute request from the Governor.

The ACLU says as long as the consequences don't exceed what would be typical for an infraction like cutting class, schools can discipline the students.

BRIGGS: Eleven thousand miles, two days later, a dog mistakenly flown to Japan reunited with his family in Kansas. That Swindle family, now back with their beloved dog, Irgo, in Wichita, Kansas after United Airlines mistakenly sent the 10 year old German Shepherd to Japan. Irgo arriving in Wichita Thursday on a high class private charter. Good for Irgo.

(BEGIN VIDEO CLIP)

KARA SWINDLE: It feels absolutely amazing to finally have him back. It's been a long four days. He instantly jumped up and was just crying. He's - when he's super excited, he cries.

(END VIDEO CLIP)

KOSIK: Such a sweet reunion. That is a well travelled dog. The Swindles had placed Irgo on a cargo flight as they moved from Oregon to Kansas and when they went to pick him up, surprise, the Swindles were given a Great Dane instead. A different dog. Irgo had been accidently put on the flight to Japan where the other dog was supposed to go. What has United done? United has apologized. BRIGGS: Irgo and his owner will be on "New Day" today.

KOSIK: I can't wait to see that.

BRIGGS: Very happy to see that.

KOSIK: Love it.

BRIGGS: Spring, just a few days away, but Winter, has still been holding on in some parts of the country like this one. Here's Meteorologist Derek Van Dam.

DEREK VAN DAM, CNN METEOROLOGIST: Good Friday morning, Dave and Alison. Pretty quiet this morning across the New England coast line stretching through the Mid-Atlantic, but things start to get interesting the further West you travel. We do have a snow storm that's developing across the northern plains, rain in advance of the system, and we're going to be measuring snowfall in feet across the Sierra Nevada mountain range of California. Take a look at the latest warnings from the National Weather Service stretching from Montana, through South Dakota, parts of Nebraska, and through that Colorado Rockies.

The storm systems evolves over the next 12 to 24 hours across the central U.S., bringing rainfall to Des Moines, as well as Kansas City and Lincoln, Nebraska, but look at the snowfall totals for parts of South Dakota. Easily exceeding 10 inches. There's heavy snowfall across California with Valley rainfall expected.

We do have a few lingering snow showers just downwind of the Great Lakes, but we'll stay dry from D.C. through Philly, as well as New York and Boston. Temperatures today, chilly for the Windy City, 38 degrees. Thirty seven for New York, but look at Atlanta finally warming up to 71. Back to you.

BRIGGS: All right, Derek. Thank you, my friend. A huge upset in the opening round of the NCAA College Basketball Tournament. The four seed Arizona champions of the Pac-12 falling to 13 seed Buffalo, 89 to 68. Blown out. Guards Wed Clark, Jeremy Harris, and CJ Massinburg combining for 67 points for the Bulls who advance to play the five seed Kentucky on Saturday.

It's been a rough year for Arizona. Their coach, John Miller, caught up in the FBI investigation. He was reportedly caught discussing a six figure payment to a recruit, but denies the allegation. This is not just a four seed.

[04:50:12] This is a hot final four national title pick. It's a bracket buster for a lot of people

KOSIK: So how's your bracket looking now?

BRIGGS: Pretty bad. I think I had them in the final four, my friend.

KOSIK: OK. I won't go to you for any advice on how to choose a bracket. BRIGGS: Hey, it's a tough one.

KOSIK: OK. Walmart's digital business is booming, but a new lawsuit claims Wamart fudged its sales data in a race to catch up with Amazon. More on "CNNMoney", coming up next.

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[04:55:00]

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BRIGGS: South Korea reacting with concern. The leaked audio of President Trump suggesting he might pull U.S. troops out of the region if he doesn't get a better trade deal. According to "The Washington Post", South Korean officials lit up the phones at the State Department and Pentagon, both agencies struggling to come up with a response. Now, more South Korean leaders weighing in. CNN's David McKenzie live for us in Seoul with that. Good morning, David.

DAVID MCKENZIE, CNN INTL. CORRESPONDENT: Good morning, Dave. Yes, you know, the foreign minister here got on local radio and said that it wasn't ideal that President Trump seems to be connecting, or maybe confusing, the issues of troops and that of trade. Of course, those many thousands of U.S. troops arm the DMZ here separating North Korea and South Korea are crucial to the national security of both the U.S. and South Korea. And also, the foreign minister talking to congressional leaders saying that there shouldn't be any linkages between those two issues.

The big goal right now, of course, is that proposed meeting between Kim Jong Un and President Trump. There are shuttle diplomacy going on around the world. In Stockholm, Sweden, the North Korean foreign minister is there. He is talking to his counterpart. Sweden, of course, represents U.S. interests in North Korea. So the speculation is is that those meetings could pave the way for the next steps towards a very complicated and crucial get-together between the U.S. and North Korean leaders. Dave?

BRIGGS: All right. David McKenzie live for us in Seoul. Thank you.

KOSIK: OK. Let's get a check on "CNNMoney" this morning. Global stocks and U.S. futures flipping over night after the S&P 500 fell over all the chaos happening in the Trump administration. It dropped on reports of Special Counsel Robert Mueller subpoenaed the Trump Organization, but investors were already nervous about a trade war, especially with China. President Trump wants to impose new steep tariffs on China. Now, the U.S. Chamber of Commerce is urging him to reconsider, warning that it will hurt American consumers. They predict the trade war could wipe out a third of the savings families will get from tax reform.

Nike's heir apparently is out over reports of inappropriate work behavior. "The Wall Street Journal" reports that Nike brand President Trevor Edwards has resigned. He's going to retire in August. Edwards was a potential successor to Nike's current CEO and his exit is setting off a management shuffle at the company. According to an internal memo, Nike was acting on reports of behavior that, quote, "does not reflect our core values of inclusivity, respect, and empowerment".

Walmart's digital business is booming, but a new lawsuit claims Walmart fudged its sales data in a race to catch up with Amazon. The suit claims the company cut corners to boost results, including mislabeling products, charging excessive commissions, and not processing returns properly. The suit was filed by a former exec who claims they fired him for complaining about it. But Walmart dismisses the allegations saying they were made by a disgruntled former employee who was let go when the business was restructured. It looks like so many businesses are feeling all that pressure from Amazon, if that is the case.

BRIGGS: Amazon forcing them to innovate, but, yes, just taking over so many industries. All right. Early Start continues right now for the latest on a White House shake up and that Miami bridge collapse at FIU. We'll have the latest for you right ahead.

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KOSIK: The President is shopping for a new National Security Advisor and looking (ph) to replace H.R. McMaster when he finds one.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Is Putin a friend or a foe of the United States?

SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: I think that's something that Russia's going to have to make that determination.

(END VIDEO CLIP)

BRIGGS: The White House stays soft on Russia despite finally levelling new sanctions. And overnight, Russia punting back against those new measures.

KOSIK: And what caused a deadly pedestrian bridge collapse at Florida International University? Four people are dead and search efforts are now focused on recovery. We're going to go to a live news conference that is moments away.

Good morning and welcome to Early Start. I'm Alison Kosik.

BRIGGS: So any questions though, right?

KOSIK: There really are.

BRIGGS: Including, if it wasn't open to pedestrian traffic until 2019, why were there cars driving under it?

KOSIK: Yes.

BRIGGS: A lot of questions for them. I'm Dave Briggs. It's Friday, March 16th. It's 5:00 AM on the east. It's March Madness in the Basketball Tournament as Arizona goes down, and it's March Madness at the White House because departures there, as well. After weeks of speculation, President Trump ready to replace his National Security Advisor, Lieutenant General H.R. McMaster. Two sources telling CNN, the President has not made a final decision on who will replace McMaster and the timing is unclear, but we're told the President wants it done before direct talks begin between the United States and North Korea. One source says any delay stems from McMaster trying to finalize his next steps.