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EARLY START

Kim Jong-un Visits China; Trump Wants Military to Pay For Wall; Tempers Flare in Sacramento. Aired 4:30-5a ET

Aired March 28, 2018 - 04:30   ET

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


[04:30:32] DAVE BRIGGS, CNN ANCHOR: A dramatic global diplomacy debut for Kim Jong-un -- a surprise visit to China. Kim says he's willing to denuclearize. What does he want from President Trump in return?

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: And who is going to pay for the wall?

AUDIENCE: Mexico!

TRUMP: One hundred percent.

(END VIDEO CLIP)

CHRISTINE ROMANS, CNN ANCHOR: In a slight evolution from that stance, the president is floating a new idea -- let the U.S. military pay for that border wall.

BRIGGS: And emotions running high in Sacramento, California, as protesters take over a city council meeting demanding answers after a police shooting of an unarmed black man.

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

ROMANS: And I'm Christine Romans. It is Wednesday. It is 31 minutes past the hour. Nice to see you all this morning.

Let's begin with an image that seemed unimaginable just a few short months ago. North Korean leader Kim Jong-un standing side by side with Chinese President Xi Jinping. These two leaders shaking hands during Kim's surprise visit to Beijing, his first trip aboard since taking power in 2011. Kim calling for a new era in bilateral relations, even inviting President Xi to visit Pyongyang. That is an offer Xi accepted.

BRIGGS: According to China's state-run media, Kim made the trip because he felt compelled to personally share details of the changing diplomatic landscape on the Korean peninsula. This marks the North Korean leader's emergence as a player on the world stage. Important to note, Xi and Kim are expected to lead their respective countries for life, lending added significance to their talks ahead of an expected summit between Kim and President Trump.

Let's bring in CNN's Ivan Watson who's live with us from Seoul with the latest -- Ivan.

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Dave, this was a surprise summit. We did not hear about the four-day visit of North Korea's leader, his first overseas trip since he assumed the throne in Pyongyang more than six years ago, we didn't hear about it until after he got back to North Korea. That's when China and North Korea both made the announcement that the visit had taken place in the first place.

And to add to the peculiarities about it, he traveled to and from China aboard a very long train, along with his entourage. A secret train, you could describe it that way. Now China is North Korea's oldest and most important ally, but the relationship has been frosty in recent years, partially due to North Korea's nuclear weapons tests and its frequent ballistic missile launches which are all banned by United Nations Security Council resolutions.

Well, Xi Jinping, he basically brushed that away, rolled out the red carpet for Kim Jong-un, talked about their alliance being a strategic choice, and Kim Jong-un dangled the prospect of denuclearization, something that he has said has been a taboo in the past, provided South Korea and China cooperate in a move towards peace -- Dave.

BRIGGS: OK, Ivan.

A new CNN poll shows nearly two-thirds of Americans approve of the president's decision to sit down with Kim. But how could the meeting between the two affect the sit down between the U.S. and North Korea?

WATSON: Well, the White House was very quick to embrace this and say that the meeting is a result of the so-called maximum pressure campaign that Washington has led. That's to impose additional economic sanctions to kind of strangle North Korea economically. And China has been on board with many of those measures.

Well, now, the North Korean leader can come to an expected face-to- face meeting with president Trump saying, hey, I've got China supporting me now, and China has made it clear that its longtime ally, and some argue proxy North Korea, is perhaps back in the fold with Beijing after the two capitals, the two governments were not seeing things eye to eye for quite a long time.

Xi Jinping, in fact, did say we shouldn't let individual incidents get in the way of this very important bilateral relationship -- Dave.

BRIGGS: Really some stunning images and a major development. Ivan Watson live for us in Seoul, 5:34 p.m. there. Thank you, Ivan.

ROMANS: Yes, really is.

All right. Thirty-four minutes past the hour.

President Trump securing a trade deal with South Korea, removing a divisive issue with our Korean ally ahead of nuclear talks.

[04:35:01] The White House confirming details of a revised trade deal between the U.S. and South Korea. Many key changes help U.S. car companies. New rules on emissions standards and doubling the number of cars they can export. American car companies can export to South Korea.

The new deal is for 50,000 American cars per year. But no U.S. carmaker exported more than 11,000 cars last year to South Korea, mainly due to consumer taste. Not trade barriers.

South Korea, their drivers prefer smaller, fuel-efficient cars. The deal also exempts South Korea from Trump's steel tariffs but limits how much it can export. South Korea's the third-biggest supplier of steel to the U.S. Officials say this delivers on Trump's campaign promise negotiating better trade deals one on one.

The U.S. is also currently talking with China to avoid a trade war. Trump threatened tariffs on Chinese imports last week, really important here, the timing. China is also the U.S.'s biggest foreign creditor, just as the government plans to sell $294 billion worth of debt this week.

Look at that. That's the highest amount of debt issued since the financial crisis. China owns more treasury bonds than any foreign country. The sale is to boost federal revenue because of Trump's tax cuts. Companies are paying less into the treasury coffers. That means, government still spending a lot of money, that means the United States has to borrow $300 billion this week to stay in business.

BRIGGS: It is just hard to believe we are talking annual deficit trickling near a trillion annually under Republican control.

ROMANS: Deficit hawks are losing their mind.

BRIGGS: Who would have thunk it?

Breaking story, moments ago, Stormy Daniels' attorney asking a federal judge for permission to depose President Trump. Michael Avenatti wants the president to share when he knows about the hush money agreement forcing Stormy Daniels to keep quiet about her alleged tryst with Donald Trump. Avenatti referring to the $130,000 Daniels received a week and a half before the 2016 election.

He also requested a deposition for the president's personal attorney, Michael Cohen, who has said he made the payment out of his own pocket. It comes one day after the White House defended President Trump's silence on the Stormy Daniels allegations.

(BEGIN VIDEO CLIP)

UNIDENTIFIED REPORTER: Why the silence? Is someone advising him to be silent, or is he following --

SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: I don't think it's silent when the president has addressed this, we've addressed it extensively. There's just nothing else to add. Just because you guys continue to ask the same question over and over and over again doesn't mean that we have to keep coming up with new things to say. We've addressed it. We've addressed it extensively. And there's

nothing new to add to this conversation.

(END VIDEO CLIP)

ROMANS: Sarah Sanders also saying although the president is a counter puncher, he doesn't necessarily punch back at every story.

BRIGGS: Yes.

President Trump privately floating the idea of using the military budget to build a wall on the border with Mexico. The source telling CNN the president discussed the notion in a private meeting last week with House Speaker Paul Ryan. The topic coming up as they reviewed the federal spending bill which does not include border wall funding.

White House Press Secretary Sarah Sanders declining to weigh in at Tuesday's briefing.

(BEGIN VIDEO CLIP)

SANDERS: The wall is continuing to be built currently, and we're going to keep pushing forward until it's fully completed in the way that the president feels is necessary to defend the country.

UNIDENFITIED REPORTER: Isn't it true at this point that Mexico's not going to pay for the wall?

SANDERS: I'm not going to go beyond what the president's already said. I think he still has plans to look at potential ways for that to happen.

(END VIDEO CLIP)

ROMANS: It is not clear how serious the president is about pursuing that idea. It would likely face steep hurdles in Congress. Congress appropriates dollars with very specific instructions on how to spend them. This is the president's latest effort to fund the border wall he promised repeatedly during the campaign that he said Mexico would pay for.

BRIGGS: Investigators for special counsel Robert Mueller say they have uncovered ties between former Trump deputy campaign chairman Rick Gates and someone with links to a Russian intelligence service. According to court filings, that person lived in Moscow and Kiev and was in touch with Gates in September and October of 2016.

ROMANS: The revelation came in court filings ahead of the sentencing of Alex Van Der Zwaan. He's the Dutch lawyer. He worked with Gates and pleaded guilty last month to lying to special counsel about interactions with Gates and that unnamed person.

BRIGGS: The FBI doubling the staff dealing with huge document demands from Congress in the wake of criticism the bureau is slow walking its response. FBI director Chris Wray putting 54 people in two shifts on the job of reviewing thousands of documents subpoenaed by House Republicans.

They relate to FBI decisions Republicans have criticized as showing political bias including the FBI probe of Hillary Clinton's private e- mail server, potential FBI abuses of foreign surveillance warrants, and the investigation that led to the firing of former deputy director Andrew McCabe. A Justice Department source tells CNN Attorney General Jeff Sessions has fumed at the pace of the FBI response and it's unacceptable.

ROMANS: All right. It is official.

[04:40:00] Facebook CEO Mark Zuckerberg will testify before Congress over Facebook's failure to protect user data. Sources tell CNN he felt he had to after facing calls from the media, from the public and lawmakers. Senate Judiciary Chair Chuck Grassley wants him at a hearing on April 10th.

Facebook also has a new legal headache. It's being sued for allegedly allowing housing discrimination. The suit claims its ad tools let marketers exclude single women and families with children.

Wall Street was not comforted by either of those headlines. Facebook shares fell another 5 percent yesterday. It has lost $80 billion in market value since the crisis began.

It wasn't just Facebook. The whole tech sector had a terrible day. Twitter, Netflix, Nvidia, Tesla down sharply. Those are big moves for a single, folks.

Tesla down 8 percent after the government said it would probe last week's fatal self-driving car crash. Tech is the market's most valuable sector. As tech faces regulator scrutiny, investors are growing wary.

Wall Street closed lower with the tech-heavy Nasdaq down nearly 3 percent. Right now, global stocks and U.S. futures now are down.

It was really a crazy day. It was up big, then it was down big. It's just -- this is a new era for investors. I think a lot of headline risk.

BRIGGS: Volatility is the word.

OK. There's a clown running for Congress in South Carolina. You might be thinking what else is new. But Steve Lough is the real deal. After three decades as a professional clown, think Ringling Brothers, Lough is running in the June primary for the Democratic nomination in South Carolina's fifth congressional district.

His campaign Website, clownforcongress.com, features him in clown make-up. Sorry, I'm terrified. And videos of him juggling. His slogan, aim high, vote Lough.

Here's one of three Democrats vying to face Republican incumbent Ralph Norman. Norman won a special election to replace Mick Mulvaney who left the House to become budget director. You do not share my fear of clowns.

ROMANS: I do not. I do not. I think --

BRIGGS: The whole killer clown thing was terrifying.

ROMANS: Didn't you want to grow up and join the circus --

BRIGGS: I did grow up to be a clown, just no make-up.

ROMANS: All right. Forty-two minutes past the hour.

A city council hearing taken over by protesters in Sacramento.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: As you point this toward council, does this look like a gun?

(END VIDEO CLIP)

ROMANS: Anger over the police shooting of an unarmed black man spilling over.

(COMMERCIAL BREAK)

[04:46:47] ROMANS: Emotions run high at a Sacramento City Council meeting after the police shooting of Stephon Clark. He was shot to death as he stood in his grandmother's backyard. Police claimed they thought the cell phone he was holding was a gun. That was not lost on demonstrators at the council meeting.

(BEGN VIDEO CLIP)

UNIDENTIFIED MALE: Does this look as you point this toward council, does this look like a gun?

CROWD (chanting): Stephon Clark! Stephon Clark! Stephon Clark! Stephon Clark! Stephon Clark! Stephon Clark!

(END VIDEO CLIP)

BRIGGS: That young man is Stephon Clark's brother. Sacramento's Mayor Darrell Steinberg forced to gavel the meeting to a close early to guarantee everyone's safety. One person was taken away in handcuffs and charged with assaulting a police officer.

ROMANS: For the second time in a week, protesters blocked the entrance to the Golden One Center. Kings officials closing the entrances to the NBA arena when protesters showed up outside. That drew an angry online response from ticketholders. But the Kings say they had to shut the doors in the name of safety.

BRIGGS: In a decision, Alton Sterling's family says it expected no charges will be filed against two police officers who gunned Sterling down in 2016. Louisiana's attorney general says the officers acted lawfully and had reason to believe Sterling was reaching for a gun. Toxicology reports detected alcohol, cocaine, and other drugs in Sterling's system. Sterling's family and supporters say officers should have de-escalated but did not.

(BEGIN VIDEO CLIP)

QUINYETTA MCMILLON, MOTHER OF STERLING'S OLDEST SON CAMERON: Yes, the system has failed us. Yes, we are disappointed. As a family, we're going to stay strong and we're going to keep each other prayed up. The devil thought he won, but he didn't.

(END VIDEO CLIP)

BRIGGS: Baton Rouge police say they will release four more videos including body cam, dash cam, and surveillance footage.

ROMANS: The former boss of disgraced USA gymnastics, Dr. Larry Nassar, is denying charges that include criminal sexual misconduct. The complaint against William Strampel alleges he used his power to sexually assault, harass and solicit nude photos from female students at Michigan State. About 50 photos containing nudity and pornography were found on Strampel's computer in February. Forensics showed someone tried to delete some of the photos.

Strampel also charged with willful neglect of duty for failing to properly oversee Nassar who admitted to sexually abusing young girls for decades. Strampel could face up to five years in prison.

BRIGGS: A Kansas grand jury bringing murder charges in the gruesome death of a 10-year-old boy on the world's tallest water slide in 2016. Jeffrey Henry, co-owner of the Schlitterbahn Water Park, and designer John Schooley was charged with reckless second-degree murder along with the company designed in building the 17-story ride.

Caleb Schwab was decapitated when the raft he and two women were strapped into went airborne.

The water park issued a statement saying the three men charged are innocent, and that they run a safe operation, adding the facts will prove in court this was just a tragic accident.

ROMANS: The catastrophic failure at an Ohio fertility clinic far worse than officials first thought. The clinic now says more than four thousand frozen eggs and embryos were lost after a freezer malfunction. That is double the original number, and unlikely any of them are viable now. University Hospital's fertility clinic in Cleveland says 950 families were affected, up from 700.

The malfunction occurred when temperatures fluctuated in the tanks where eggs and embryos were stored. An investigation revealed an alarm system which should have alerted an employee to temperature swings was shut off. It's a tragedy there.

ROMANS: Just got harder to find the latest issue of "Cosmo" at Walmart. Walmart removing the magazine from checkout lines. We'll tell you why, next. (COMMERCIAL BREAK)

[04:55:13] BRIGGS: A march in Paris today to honor the memory of an 85-year-old Holocaust survivor brutally murdered in her apartment. Mireille Knoll was stabbed 11 times before her home was set on fire. Police are investigating her death as a suspected anti-Semitic attack. One two of suspects arrested is Knoll's 27-year-old neighbor who served jail time for sexual assault. The other, a 21-year-old homeless man, known to police for a violent past.

The threat of severe weather moving up to the South and Gulf Region today.

Meteorologist Pedram Javaheri joins us from the CNN weather center.

(BEGIN VIDEOTAPE)

PEDRAM JAVAHERI, AMS METEOROLOGIST: Big-time storms this morning across central portions of Texas. In fact, lightning strikes approaching 1,000 strikes since midnight across the region. And parts of San Antonio, parts of Austin really getting the brunt of the activity, expect all of that to want to shift farther towards the east, quiet right now in places like Houston, Shreveport, and Little Rock. That won't be the case by this afternoon as the line shifts a little farther to the east there. So, we expect a similar sort of a setup across this region with strong thunderstorms, maybe large hail, potentially an isolated tornado could be embedded with some of these storms.

But the big story is not the rain, hail, even the isolated shot of tornadoes, it's the very, very large likelihood of tremendous rainfall. Some areas getting as much as 10 inches, and, of course, when you put this amount of rainfall anywhere in the world, it's going to cause major problems.

But this area has already been very saturated in recent weeks. So, that's going to be problematic over the next several days in that region.

Eighty-two degrees in New Orleans today, 81 in Montgomery, 74 up in Charlotte. While you work your way toward places like Chicago and New York, how about we warm up a little bit in Chicago up to almost 60 degrees -- guys.

(END VIDEOTAPE)

ROMANS: All right. Thanks.

Let's get a check on CNNMoney this morning.

Global stocks lower now following a tech sell-off on Wall Street sending U.S. stocks lower. Crazy day. Market was up big, down big. Tech is the market's most valuable sector, but its investors are wary of tech companies face greater regulatory scrutiny.

Facebook fell another 5 percent after CEO Mark Zuckerberg said he would testify before Congress. For those of you keeping score, it has now shed $80 billion in market value since its data crisis began. It wasn't just Facebook. Twitter, Netflix, Nvidia, Tesla, all plummeted.

Tesla down 8 percent after the government said it would probe last week's fatal self-driving car crash. Wall Street bankers are making near record bonuses despite cries of overregulation. Last year, the average bonus soared 17 percent to $184,200. Just for some comparison, that's triple the national median household income. And it's just shy of the record in 2006.

What happened in 2006? Oh, yes, that was just before the whole financial system melted down. The strong payouts also come as Congress works to roll back parts of Dodd-Frank, the law passed in the wake of the financial crisis. The Senate passed a bill this month easing regulations on community banks, regional lenders, and some mortgage companies.

It just got harder to find the latest issue of "Cosmo" at Walmart. Walmart removing the magazine from checkout lanes. An anti-porn group, the National Center on Sexual Exploitation claims they influenced the decision. They're working to remove "Cosmo" from stores for years, deeming it porn.

Walmart says this was primarily a business decision, but the concerns raised were heard. "Cosmo" is known for sex tips and advice for young women. Walmart will still sell the magazine, but it will be away from the register.

I know you think this is crazy.

BRIGGS: I think this is unbelievable. It's 2018.

ROMANS: I do have to say, one thing about checkout lanes that drive me crazy, all the candy just in the eyesight lines for kids. Then you look sometimes --

BRIGGS: That's good marketing.

ROMANS: You look sometimes and look at them standing in front of magazines. My little 7-year-old is trying to spell out the words.

BRIGGS: They know how to Google stuff, people. Magazine industry's having a tough enough time.

Outrageous. Let me know if I'm crazy @earlystart on Twitter.

ROMANS: Well, on this subject.

BRIGGS: Well, we know that for a fact.

EARLY START continues right now with the stunning meeting between Kim Jong-un and Xi Jinping.

(MUSIC)

BRIGGS: A dramatic global diplomacy debut for Kim Jong-un, a surprise visit to China. Kim says he's willing to denuclearize, but what does he want from President Trump?

ROMANS: Breaking overnight, Stormy Daniels' lawyer has filed a request to depose president Trump. Will the president have an answer about the $130,000 payment under oath?

BRIGGS: And emotions running high in Sacramento, California. Protesters take over a city council meeting, demanding answers after the police shooting death of an unarmed black man.

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

ROMANS: And I'm Christine Romans. It is Wednesday, March 28th. It is 5:00 a.m. exactly in the East.

Let's begin with an image that seemed unimaginable just a few short months ago. North Korean leader Kim Jong-un standing side by side with Chinese President Xi Jinping.