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EARLY START

China Retaliates For Trump Tariffs; Trump's Anti-Immigrant Easter Tirade; Source: Spy's Poisoning Likely Had Kremlin Approval; U.S. And South Korea Being Military Drills. Aired 5:30-6a ET

Aired April 2, 2018 - 05:30   ET

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


[05:30:15] RENE MARSH, CNN ANCHOR: China makes good on a promise, hitting the United States with tariffs on $3 billion in U.S. goods. The move is retaliation for the president's tariffs on China. How will the White House respond this morning?

DAVE BRIGGS, CNN ANCHOR: No more DACA deal. The president with an Easter morning tirade taking help for Dreamers off the table and demanding Mexico take action to stop drug dealers.

MARSH: And was the poisoning of a former spy in the U.K. directed by the Kremlin? British authorities say yes.

Welcome back to EARLY START. I'm Rene Marsh.

BRIGGS: And I'm Dave Briggs.

Some interesting news ahead. No matter where you live in this country you are likely to see Nancy Pelosi in Republican ads ahead of the midterms. We'll tell you why in just a moment.

We start though on trade. China making good on its trade threats, stoking fears of a trade war.

Starting today, China will slap tariffs on $3 billion worth of U.S. goods in retaliation against President Trump's duties on foreign steel and aluminum. The Chinese tariffs hit 128 U.S. products ranging from agricultural products -- pork, fruit, nuts -- to steel, pipes, and aluminum.

This move is the latest in escalating tensions between China and the U.S., which may only get worse. The president has more trade actions in the works, like tariffs on some $50 billion worth of Chinese goods. Experts warn they could cause further retaliation and a trade war would be devastating for U.S. consumers, investors, and companies.

The president, of course, has long accused Beijing of unfair trade practices that steal American jobs but in his first year in office did not make any major trade moves. However, the exodus of a number of globalists from the White House, like Gary Cohn and Rex Tillerson may be fraying the president to follow through on his trade threats.

China has repeatedly said it does not want a trade war but warns it will take firm countermeasures if necessary. In the true spirit of Easter Sunday, President Trump spent part of the holiday morning on an anti-immigrant rant.

"Border patrol agents are not allowed to properly do their job at the border. Getting more dangerous. Caravans coming.

Republicans must go to the nuclear option to pass tough laws now. No more DACA deal!"

The Twitter tirade just the latest example of the president going with his gut at a key moment on several policy and political fronts.

MARSH: And his tone drew swift and sarcastic pushback from many inside and outside of Washington.

Among them, Ohio Gov. John Kasich. He tweeted, "A true leader preserves and offers hope. Doesn't take hope from innocent children who call America home. Remember, today is Easter Sunday."

And this from Republican Congresswoman Ileana Ros-Lehtinen. "Such a strong message of love and new beginnings from Donald Trump on Easter Sunday." Clearly, some sarcasm there.

BRIGGS: A little bit. All right.

Joining us this morning to talk about all of this, "Washington Examiner" commentary writer Philip Wegmann. Good to see you, Phil.

Got to hand it to the president. He combines Easter with Festivus, airing his grievances all throughout Easter Sunday. You saw the tweets that Rene just read and here is what the president said to reporters about the border and nuclear options.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Mexico has got to help us at the border. And a lot of people are coming in because they want to take advantage of DACA and we're going to have to really see.

They had a great chance. The Democrats blew it. They had a great, great chance but we'll have to take a look."

(END VIDEO CLIP)

BRIGGS: OK, you're a commentary writer but let's first do the fact- check when you go back to the tweets on the wall, on the nuclear option like he just said there, and how Democrats blew it.

What are the issues with those claims?

PHILIP WEGMANN, COMMENTARY WRITER, "WASHINGTON EXAMINER": Well, there's certainly a lot to unpack. I mean, this is the consequence of having 280 characters on Twitter here and the president can have these paragraphs.

But I think one thing that is important here is a little bit of context because last year, in March, President Trump was bragging about the fact that border crossings were down by 40 percent. Now, the president is trying to turn around say that his border patrol and his ICE agents are still being handcuffed and stopped by Democrat policies.

But he's the president here obviously, and he had an opportunity to cut a deal on DACA with Democrats. Republicans offered compromises and they were rejected, and Democrats did the same thing -- vice versa.

I think what we're seeing here is frankly that both parties are going into the midterm elections knowing that leaving the DACA issue unsolved is more favorable for them electorally, and both sides are trying to squeeze as much juice out of the issue as they can before voters head to the polls at, you know, this November.

[05:35:02] MARSH: So let me push on that point just a little bit because it sounds like you believe that not resolving DACA is a plus. Some might say actually, that could be problematic for Republicans in states like Florida, California, and Texas if they are seen as not looking to solve this issue and even using the Dreamers as a bargaining chip.

WEGMANN: Absolutely, and the cynical analysis here is the honest analysis and I think that both Republicans and Democrats are using DACA as a bargaining chip and this is how things get done in Washington, D.C.

But what's interesting about the DACA issue here is that you see that the president was eager to make a deal earlier on, but if he was serious about that he would have pushed harder during the omnibus when you attach things to these larger, bigger picture issues. And I think that the thought here from the White House is that they can stir up their conservative base, who they need to get to the polls, by appealing to his trademark issue.

BRIGGS: Yes, just a few of the things you've got to take issue with when he says they want to take advantage of DACA -- you have to have lived here since 2007. Also, the issue that he took DACA, ending it -- just a lot of problems there in terms of facts, but heck with it.

Let's talk about an interesting story, Phil. On the front of the "USA Today," they have some fascinating numbers about Nancy Pelosi because you won't believe it. No matter where you live in this country you will see her in Republican ads come the midterms because 34 percent of House ads, according to "USA Today" and data they've gained, will feature Pelosi. That is up from nine percent in 2016.

What is happening here? Why is she so popular with Republicans?

WEGMANN: Well, I think unless Barack Obama pulls a John Quincy Adams and returns from retirement to run for Congress, Nancy Pelosi is going to continue to be the star of a lot of these GOP campaign ads because she's the de facto face of the party.

What Republicans are trying to do right now is remind voters of what life was like under her speakership, remind voters of what she's done to oppose the president's agenda -- for instance, when it comes to tax cuts -- and really push them to think about what the future would look like when President Trump has to deal with a House under her control.

And if you're -- if you're a conservative voter in a Midwestern state like Ohio, this is something that's going to perhaps pique your interest. This is something that could motivate you to get to the polls because Nancy Pelosi is the inverse of everything that you want so far.

BRIGGS: Of course, it did not work in Pennsylvania's 18th. Fifty- eight percent of ads there from Republicans featured Pelosi and they lost. That may have a lot to do with the candidate.

Philip Wegmann, "Washington Examiner," good stuff -- appreciate it.

WEGMANN: Thanks for having me.

MARSH: All right, and two top Republicans giving a big vote of confidence to Robert Mueller. Senator Tim Scott and Congressman Trey Gowdy trying to shield the special counsel from attempts by some in the GOP to discredit Mueller.

(BEGIN VIDEO CLIP)

REP. TREY GOWDY (R), SOUTH CAROLINA: I'm glad we have Bob Mueller. I'm glad we have an independent ball and strike caller. Congress has proven itself incapable of conducting serious investigations.

Congressional investigations leak like the Gossip Girls. They -- I mean, they're terrible and I would be telling you that if I were staying in Congress. They're just not serious.

SEN. TIM SCOTT (R), SOUTH CAROLINA: It only reinforces why it's important for us to make sure that the investigation continues until it gets to the end. I hope that we get there sooner than later but the reality of it is that the more information we find out the better and the more confident the American people will be in who we are as a nation.

(END VIDEO CLIP)

MARSH: Well, that's a starkly different tone from Wisconsin Sen. Ron Johnson who told "MEET THE PRESS" he thinks Mueller was appointed far too soon.

BRIGGS: All right.

Breaking overnight, a source tells CNN British investigators believe the poisoning of former Russian double-agent Sergei Skripal likely had the approval of the Kremlin.

CNN's Matthew Chance live in Moscow with the latest. Hi, Matthew.

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Hi, Dave. Well, this is further than British investigators have gone before, saying that the Kremlin would have been -- may have been responsible for ordering this nerve agent attack on the streets of Salisbury in southern England.

Within the past few minutes, we've had reaction from the Kremlin to that latest allegation and they said this. We have nothing to do with this nerve agent poisoning at all. And so the Russians have once again categorically denied any involvement in this.

In fact, there's been obviously, an angry reaction from the Russians over the course of the past several weeks since this crisis has been playing out.

The latest narrative that the Russians are pushing, and there's been more than dozen narratives that have been put out by various Russian officials and by state television, is that it's the British themselves that may have orchestrated this attack on the Skripals -- Yulia and Sergei Skripal, of course -- in order to undermine Russia internationally.

[05:40:15] That is, believe it or not, the latest line that the -- that Russian state television is putting out to try and explain this.

BRIGGS: All right. Matthew Chance live for us at 12:40 p.m. there in Moscow. Thank you.

MARSH: Well, if you shop at Saks or Lord & Taylor, a major data breach you need to know about. Five million people's credit cards affected. Are you one of them? The details coming up.

(COMMERCIAL BREAK)

[05:45:14] BRIGGS: Five forty-five eastern time. Let's get a check on "CNN Money."

Another big data breach is hitting millions of U.S. consumers. Hackers stole the credit card info of about five million customers at Lord & Taylor and Saks department stores. That hack affects 130 U.S. stores, the majority in New York and New Jersey, with sales dating back to May 2017. The breach did not hit any online stores, though.

A cybersecurity firm first identified the leak but Hudson's Bay Company, the parent of both stores, confirmed it Sunday telling CNN in a statement, "Once the company has more clarity around the facts, it will notify customers quickly and will offer those impacted free identity protection services."

This breach just the latest in nearly two dozen cyber thefts over the past few years, including online giants like Yahoo and AOL, credit reporting agency Equifax, and large retailers like Target, Home Depot, and T.J. Maxx.

Wall Street's second quarter kicks off today but the market could start the week lower. Global stocks and U.S. futures falling overnight as China slaps new tariffs on U.S. goods. This week, Spotify makes its market debut. The streaming news service going public tomorrow but it's not like other IPOs.

Spotify plans a direct listing, meaning it will share shares -- sell shares directly to investors. That saves it hundreds of millions in fees but could also mean a volatile start.

The Department of Justice wants to abandon its lawsuit against Microsoft over data privacy. Why? Because a new law answers the legal questions central to the case.

The DOJ sued Microsoft after it refused to hand over e-mails stored overseas. Microsoft argued that could violate international treaties but the new CLOUD Act answers that question. U.S. judges can now issues warrants for such data but it also allows companies to object if the request conflicts with foreign law. Microsoft cheered the law, calling it a good compromise.

CVS being sued for allegedly revealing the HIV status of 6,000 patients. CVS mailed letters to patients in Ohio's HIV drug assistance program last year. Now, a federal suit claims the status could be seen through the clear window just above their name and address.

CVS failed to announce the breach and did not contact those affected. In a statement to CNN, CVS apologized for the mistake, adding that it takes responsibility to safeguard confidential information very seriously.

MARSH: Well, the U.S. and South Korea have kicked off their traditional springtime military training exercises. In the past, these drills have angered North Korea and upset Beijing, but this year the response could be different.

CNN's Paula Hancocks is live for us this morning in Seoul. Paula, good morning.

PAULA HANCOCKS, CNN INTERNATIONAL CORRESPONDENT: Hello, Rene.

Well, you are right. This is a very different springtime for these annual drills to be starting. The start was low-key. It was discreet by the U.S. and South Korean militaries and it's also going to be a lot shorter than it usually is. These drills will last just one month as opposed to two months last year, and that's the norm.

But we are being told by the Pentagon and by South Korean military that the scope is the same, the scale is the same. But clearly, they are trying not to provoke Pyongyang at a time when relations are thawing.

By this time we usually know exactly which drills we will be allowed to go to to film and to broadcast around the world and be seen by North Korea as well. And yet, this time around there is nothing planned so clearly, not wanting to spill any kind of thawing in relations. And we saw that on Sunday night as well. The North Korean leader Kim

Jong Un waving and applauding at a K-pop concert in Pyongyang, a very rare concert. Nothing like this has happened since 2005 and even then the North Korean leader at the time didn't go to it.

And also, quite ironic considering -- ironic considering that the regime actually punishes North Korean people who try and watch this kind of South Korean pop culture on smuggled U.S. C.D.s (ph), for example. And yet, here you see Kim Jong Un meeting with those K-pop stars and certainly, this momentum is building -- Rene.

MARSH: It feels like a wave of change.

Paula Hancocks, thank you this morning.

Well, China's defunct space lab made a fiery reentry into earth's atmosphere overnight. China's manned space agency says the spacecraft was mostly vaporized as it plummeted to the earth over the South Pacific.

China launched the ambitious unmanned space lab in September of 2011. The Chinese government later announced that the spacecraft ceased functioning in March of 2016, but they didn't say why.

[05:50:00] BRIGGS: All right. Ahead, a finish for the ages in the women's national title game. Andy Scholes live in San Antonio with the "Bleacher Report," next.

(COMMERCIAL BREAK)

BRIGGS: It's going to be a late night for Mr. Andy Scholes. Michigan and Villanova square off tonight for basketball's national championship.

MARSH: And, Andy Scholes is already in place in San Antonio with a preview. Good morning, Andy.

ANDY SCHOLES, CNN SPORTS CORRESPONDENT: Hey, good morning, guys. I'm going to have to mix in a nap at some point today because like you said, a late tip-off tonight for the national championship game.

If Villanova wins they really can enter themselves into that college basketball dynasty conversation. They'd be just the fourth school in 40 years to win two out of three titles, joining the likes of Duke, Kentucky, and Florida.

[05:55:07] And, you know, when the bracket come out, Villanova was the favorite to win it all and it certainly looked like it on Saturday, just blowing Kansas right off the floor.

Now, standing in their way tonight is Moe Wagner and Michigan. The 20-year-old from Berlin, Germany was just outstanding against Loyola in the semi-finals. They'll need him to play big again tonight.

And to win a national championship, of course, you need a good team. But as both coaches told me when I sat down with them, they also said you need a little luck.

(BEGIN VIDEO CLIP)

JOHN BEILEIN, COACH, UNIVERSITY OF MICHIGAN: You know, we've had a lot of breaks this year. I think it was Ben -- maybe it was Thomas Jefferson or Ben Franklin said the harder you work the more luck you have, and we have worked hard. We deserve this but we definitely have had some breaks along the way.

JAY WRIGHT, COACH, VILLANOVA UNIVERSITY: One of the things you learn when you do win it is how many breaks you had to get along the way and how many things had to fall right for you.

And you look back at some of your other teams and realize this team might have been good enough but we didn't get a break here. We got a bad match-up there, maybe the ball bounces the wrong way. So you realize how fragile it is to -- when you're doing it.

(END VIDEO CLIP)

SCHOLES: All right, we'll crown a national champion tonight here in San Antonio. Michigan is taking on Villanova. Tip-off, 9:20 eastern on TBS.

All right.

In the women's national championship game between Notre Dame and Mississippi State, we had a fabulous finish. Arike Ogunbowale beat UConn in the semis with a last-second shot and she did it again to win the national championship.

It was the first for Notre Dame in 17 years. They were down 15 in this one in the third quarter and mounted the biggest comeback in title game history.

Ogunbowale's parents named her Arike, which means in Nigeria to see and to cherish, and this is going to be a moment the Fighting Irish cherish for a long time.

(BEGIN VIDEO CLIP)

ARIKE OGUNBOWALE, GUARD, NOTRE DAME FIGHTING IRISH: It's just my teammates. They're talking to me all the time. No matter if I'm one for 20 or whatever they're going to be like keep going to the basket, we need you. So I think they give me the confidence to keep going.

(END VIDEO CLIP)

SCHOLES: And pretty cool guys that Notre Dame wins the national championship on Easter Sunday.

BRIGGS: Yes.

MARSH: Yes.

SCHOLES: And how about Ogunbowale? BRIGGS: Yes.

SCHOLES: She's going to go down as the most clutch women's basketball player ever, at least for the college game.

BRIGGS: Hard to argue with that. And tonight, a 9:20 tip, so I think that ends about the time we get up.

MARSH: Yes.

BRIGGS: We should look forward to it.

MARSH: That's right.

BRIGGS: Nova and Michigan.

SCHOLES: Right.

BRIGGS: Thank you, Scholes. Enjoy the game, buddy.

SCHOLES: All right.

MARSH: All right. Well, April is here but winter is refusing to leave the northeast.

Let's bring in meteorologist Ivan Cabrera to tell us how long this is going to last. Good morning, Ivan.

IVAN CABRERA, AMS METEOROLOGIST: Hey, guys, good morning.

This is not the color, right, that we typically see in April. It is snowing heavily across parts of Pennsylvania. Of course, it will be on top of us in the next several hours and it will be accumulating.

The temperatures are just cold enough for that unfortunately, and we're going to see several inches of accumulation and then we'll begin to melt things. By the afternoon, we'll be back in the mid-40s.

As far as the timing, here is the snow on top of us now through the early-morning hours and then by midday we'll begin to see the snow rates tapering down, and then the snow altogether. And a little bit of rainfall further to the south. That's all out of here by the evening commute so we'll be done with that, but not before we drop significant snow for this time of year anyway, right?

Two to four inches generally. There will be pockets of 6-inch snowfall rates and then the snowfall rates will be heavy so we'll be about six inches. Across the mountains in western PA we'll be looking at several inches there. Eight to 12 potentially across the higher elevations.

Look at that 66 sticking out there. We'll hang onto that. That will be our warmest day on Wednesday in New York and then we'll cool back down without the snow, though. Temperatures back in the forties and fifties by the end of the week.

BRIGGS: A mid-week tease, down 25 degrees from there. Thank you, Ivan.

New figures reveal violent crime in Chicago remains on a steady decline. March was the 13th consecutive month of declining gun violence in the city. Year-to-date, murders have dropped 22 percent and shootings 25 percent.

Chicago police attribute the drop to hiring more officers and stronger community policing efforts among other efforts, including technology.

Thanks for joining us, everybody. I'm Dave Briggs.

MARSH: And I'm Rene Marsh. "NEW DAY" starts right now.

(BEGIN VIDEO CLIP)

TRUMP: It is the largest deficit of any country in the history of our world.

MARSH: China striking back, imposing new tariffs on nearly $3 billion of U.S. goods.

UNIDENTIFIED MALE: We should have gotten the world together and taken on the Chinese for diplomacy.

TRUMP: There are a lot of people are coming in because they want to take advantage of DACA. It can't happen that way and it won't.

JULIAN ZELIZER, CNN POLITICAL ANALYST, PROFESSOR OF HISTORY AND PUBLIC AFFAIRS, PRINCETON UNIVERSITY: This is the kind of tweet that will stir up opponents of this program.

ERROL LOUIS, CNN POLITICAL COMMENTATOR: The Democrats are going to feast on this and say that this is an example of a White House that does not know how to lead.

BRIGGS: The White House insisting that the outgoing V.A. secretary resigned.

DAVID SHULKIN, FORMER SECRETARY, VETERANS AFFAIRS: There would be no reason for me to resign. I made a commitment.

UNIDENTIFIED MALE: It's all blue smoke and mirrors. It's all a distraction to keep you away from the very real issues that he's having to deal with.

(END VIDEO CLIP)