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How Scott Pruitt Is Reshaping the EPA; Growing Trend Of Vaping Among American Teenagers; Trump Threatens China With $100 Billion In New Tariffs; AT&T Trial Turns Its Attention To Comcast-NBCUniversal Merger. Aired 7:30-8a ET

Aired April 6, 2018 - 07:30   ET

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


[07:30:00]

ALISYN CAMEROTA, CNN ANCHOR: John Avlon, Michael Smerconish, thank you both very much.

So, the controversies around EPA chief Scott Pruitt continue but his policies are having a major impact at the EPA. Up next, we'll talk to the former director of the agency about what those policies are and what they're doing.

(COMMERCIAL BREAK)

DAVID GREGORY, CNN ANCHOR: All right, it's what we've been discussing all week. Embattled EPA administrator Scott Pruitt is under fire for a series of ethical lapses and controversies. But lost in all of that, Pruitt is fulfilling President Trump's anti-regulatory agenda. He's reshaping the Environmental Protection Agency.

Joining us to discuss that is the former director of the EPA under President Obama, Gina McCarthy. Good to have you here -- welcome.

GINA MCCARTHY, FORMER ADMINISTRATOR, ENVIRONMENTAL PROTECTION AGENCY, UNDER PRESIDENT BARACK OBAMA: Thanks, David. It's good to be here.

GREGORY: You know, there is -- I know you don't want to render judgment on these ethical concerns being raised against Mr. Pruitt but there is a concern among his supporters that it's his potency as EPA director -- the moves that he's taken that is fueling a lot of the heat against him that's causing his critics to raise the temperature on these lapses.

[07:35:08] Is that fair? Is some of this overblown because a lot of people don't like what he's doing at the EPA?

MCCARTHY: Well listen, I would probably be the first to say that I don't believe that Scott Pruitt is acting in the best interest of the Environmental Protection Agency public health -- our ability to live healthy lives, our ability to address climate change. Those are the things he should be talking about and thinking.

Now, clearly, the ethics lapses are real. I don't think anyone's making those issues up and I think they are compelling. I think they speak to his judgment.

But to me, the more critical issue is his judgment in how he's doing his job. How is he fulfilling the mission of that agency?

GREGORY: Well, and let's --

MCCARTHY: Is he really protecting public health?

GREGORY: Right, and I want to get into that. But just to button that up, you served in this job. With what you know --

MCCARTHY: Yes.

GREGORY: -- at this point, would you have lost your job had you been responsible for these decisions?

MCCARTHY: I really can't -- you know, I can't make a judgment about whether I'd have lost my job. I think I would have felt like I had lost my mind if I actually thought that President Obama would tolerate this type of behavior. It never would have happened. It wouldn't have crossed my mind to do it.

I'm a public servant. I have a responsibility to protect the public trust. So regardless of how I was doing my job at EPA, it was important for me to act like a public servant, to respect the public trust. To make sure that the money that the public gives is being used properly.

I never would have considered flying first-class, never mind spending $50 a night for an apartment -- for a one-room and having that sort of set aside for me forever. It just never would have happened.

There were rules of the road. We followed them. We were transparent.

People knew where I lived. They knew that I paid my bills. They knew that I was working for that agency, not my own personal benefit.

GREGORY: Yes.

MCCARTHY: And that's the way of the -- that was the way that the job got done --

GREGORY: You --

MCCARTHY: -- and it had to be done that way.

GREGORY: You well know because in my research, both you and Pruitt are looked at as people who took advantage of the executive authority that is vested in the EPA administrator to fulfill policies that were consistent with the view of the President of the United States. And this is one of those areas, environmental regulation, where elections really do matter.

So given that, what is your view? What is your primary criticism of the direction that Pruitt is taking the EPA and the impact on public health? MCCARTHY: Well, I think there's a great difference between executive orders and executive authority. I worked for the executive government. My job in that branch of government was to do what Congress told me.

That means I enforced the law. That means I did what the law told me. I actually used the public process. I was transparent, I was not secret.

In the decisions I made, I followed the law, I followed the process, and I relied on the courts to make judgments if my judgment wasn't correct.

GREGORY: All right. Well, let's give examples though of areas of public health.

MCCARTHY: That's what he should be doing.

GREGORY: So look at the list --

MCCARTHY: Yes.

GREGORY: -- of the areas where his supporters would say he's been incredibly effective so far.

Repealing the Clean Power Plan --

MCCARTHY: Yes.

GREGORY: -- centralizing control of Clean Water Act decisions, revising fuel efficiency standards. That's actually in the news today. Easing Clean Air Act regulations.

He has also been a driving force behind saying to the president look, don't sign onto the Paris Climate change treaty.

MCCARTHY: Yes.

GREGORY: So where has he gone astray --

MCCARTHY: Yes.

GREGORY: -- in your view, as a matter of public health?

MCCARTHY: Well, let's talk about this. I mean, all of those issues. The only thing that Scott Pruitt talks about or seems to consider is whether or not it's reducing costs to business. Now, I understand you want to keep costs low and keep the economy moving, but his job is to protect public health and the environment in ways that continue to keep the economy moving.

And I would suggest to you let's just look at the car rule. Now, all of these rules are being proposed to be changed. None of them are gone -- none of the them -- and I highly suspect with the way he's locked himself in a room and not engaged the career staff or fundamentally looked at science and the law correctly that when you go to court you will see that we will continue to move these rules forward because we did them right and all he's looking at is reducing costs to business.

GREGORY: So, don't --

MCCARTHY: Now again, I appreciate that. But if you look at the car sector, when we first regulated them and we demanded cleaner and more efficient cars, they have had record sales ever since.

[07:40:04] They came into the Obama administration ready for bankruptcy. They were bailed out. We regulated, we worked with them.

They are doing great and those regulations are protecting public health. And they're taking carbon pollution out of the -- out of our atmosphere and protecting the planet.

GREGORY: And there are --

MCCARTHY: What is wrong with a scenario that protects public health and delivers sound business?

GREGORY: And there are --

MCCARTHY: What's wrong with that?

GREGORY: There are -- there are proposed rollbacks of those fuel efficiency standards.

MCCARTHY: Yes.

GREGORY: However, there may also be a deal between the federal government and California before it gets to litigation. That's potential, but we're going to have to leave it there.

Gina McCarthy, thanks so much for your time.

MCCARTHY: All right, David, thanks.

GREGORY: Thanks.

CAMEROTA: So, David, e-cigarettes are a trend that are picking up steam and keeping health officials up at night. Dr. Sanjay Gupta on why some fear that vaping could turn into an epidemic for teenagers. That's next.

(COMMERCIAL BREAK)

GREGORY: There is a very serious health story around the country that doesn't get enough attention with all the political news, an epidemic among middle school and high school students known as vaping.

These same kids who would not smoke cigarettes are turning to e- cigarettes, commonly known by the brand-name JUUL, to vape. It's having serious consequences, particularly with regard to addiction to tobacco and nicotine among these kids.

[07:45:07] CNN's Dr. Sanjay Gupta has more.

(BEGIN VIDEOTAPE)

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT (voice-over): In Milford, Connecticut, high school principal Francis Thompson is desperately trying to snuff out a problem that teachers are having all across the country.

FRANCIS THOMPSON, PRINCIPAL, JONATHAN LAW HIGH SCHOOL, MILFORD, CONNECTICUT: They would come in here and you'd have four or five kids at a time congregating and they'd start to vape.

GUPTA: It's a trend that many parents are not even aware of, but e- cigarette use or vaping has grown an astonishing 900 percent among high school students in recent years according to the Surgeon General.

And a 2016 National Youth Tobacco Survey found nearly 1.7 million high school students and 500,000 middle-schoolers have used e-cigarettes in just the 30-day period before the survey was taken.

In Wrentham, Massachusetts, assistant vice principal Spencer Christie says he, too, is overwhelmed by this new and pervasive epidemic.

SPENCER CHRISTIE, ASSISTANT VICE PRINCIPAL, KING PHILIP REGIONAL HIGH SCHOOL, WRENTHAM, MASSACHUSETTS: These are JUUL pods. Now it's moved to students vaping in hallways, vaping in classrooms.

JENNIFER WALDEN, TEACHER, KING PHILIP REGIONAL HIGH SCHOOL, WRENTHAM, MASSACHUSETTS: In the back two desks in the corner they had their hands kind of up like this and there was a blue light coming from between their hands.

THOMPSON: The most popular item, which is the JUUL, and as you can see it looks like a flashlight but it's not. And then, the kids can just tuck it away when they're done. So --

GUPTA: It's not just the design of these products. Critics say all these flavors also entice kids to start vaping.

One study out of Harvard found some of these artificial flavors contain diacetyl. That's a chemical linked to severe respiratory disease.

THOMPSON: The kids that I talk to believe that there is nothing in there that's dangerous. They don't think there's anything more than water.

GUPTA: It's not water. It's called e-liquid and when heated by the coil it changes to an aerosol.

Columbia University researchers, using this machine, found the vapor has toxic metals like chromium, nickel, zinc, and lead. And as we know, there is no safe level of lead.

With very little regulation, people are not fully aware of what they're consuming. I sat down with the FDA commissioner, Scott Gottlieb, and asked him

about this e-cig phenomenon.

DR. SCOTT GOTTLIEB, COMMISSIONER, FOOD AND DRUG ADMINISTRATION: Youth use is deeply concerning to me. We're going to be taking some enforcement actions very soon to target companies that we think are marketing products in ways that they are deliberately appealing to kids.

I'm going to be having conversations with some of these companies trying to inspire them, if I can, to take more corrective actions on their own.

GUPTA: Don't forget, nicotine is one of the most addictive substances out there.

THOMPSON: I think it's the next epidemic among teenagers.

(END VIDEOTAPE)

GREGORY: Sanjay, thank you for turning your attention to this. It is a hideous problem. These tobacco companies --

GUPTA: Yes.

GREGORY: -- as you point out, are marketing this to kids by having those flavored pods. That's outrageous when they say what they're really trying to do is help smokers try to cut down on smoking.

To get to the heart of it is --

GUPTA: Yes.

GREGORY: Not only is this so easily undetectable but it is the gateway, right? I mean, it is the getting -- if you smoke a JUUL -- if you -- one pod is the equivalent to two packs of cigarettes in terms of the nicotine delivery.

What is the impact on getting kids hooked on nicotine and then where does it go from there?

GUPTA: That is the exact rub. I mean, you know, if you talk to experts within the government they're saying look, there may be some evidence that it has decreased smoking among adults. If you remember, it was marketed as a smoking cessation tool but you've seen these staggering numbers -- a 900 percent increase among youth.

We know that among youth, combustible cigarette consumption has gone down. But of the new cigarette smokers who are smoking actual cigarettes, a quarter of them, roughly, start off by using e-cigs --

GREGORY: Right.

GUPTA: -- so there does appear to be that sort of gateway thing. It may have had an impact on adults but now we're paying the price with regard to youth. That's the real concern. CAMEROTA: But, Sanjay, just so I understand because my kids haven't encountered this yet -- God willing, they won't -- but is it the same as when teenagers smoked in the seventies, and eighties, and nineties? Or is vaping, somehow because of all the metals that you talked about, somehow worse?

GUPTA: Well, it's -- you know, this is a totally unregulated thing. Amazingly, cigarette smoking has been totally unregulated as well. Now they're talking about putting upper limits on the amount of nicotine in regular cigarettes.

But with this, there's -- with these e-vape -- e-cigarettes -- vaping, they think there's all these other substances in there and we just don't know what they're going to do to the body long-term.

GREGORY: Including pot. I mean, that's the point is that there are ways to get pots that have the THC content in there and they get high from the nicotine --

GUPTA: That's right.

GREGORY: -- because it's so concentrated.

GUPTA: That's right.

CAMEROTA: Sanjay, thank you for sounding the alarm about all of that.

GUPTA: You got it. Thank you.

CAMEROTA: A really important story.

All right, time for "CNN Money Now."

President Trump is threatening steep new tariffs on China as the White House prepares for the release of the March jobs report.

Alison Kosik is here with more. Hi, Alison.

ALISON KOSIK, CORRESPONDENT, "CNN MONEY": Hi, Alisyn.

So fears of a trade war are rattling investors yet again and that's after President Trump threatened China with $100 billion worth of new tariffs.

[07:50:04] We're watching the Dow. It's set to fall about 250 points at the open and that's actually off the lows. Dow futures tanked 400 points initially.

So some investors are really hoping that the threats we're hearing are just a negotiating ploy that won't actually result in a full-blown trade war.

The March jobs report could also add more volatility today. Economists are predicting 185,000 jobs were created. That's a slowdown from February. Still, it would mark the 90th-straight month of job creation, a historic run of 7 1/2 years. The jobless rate could also dip to four percent. That's a fresh 17- year low.

Wall Street also watching how fast wages grew. Two point seven percent is the prediction. Anything stronger could raise fears of inflation and higher interest rates -- Alisyn.

CAMEROTA: OK, thank you very much.

GREGORY: So, the focus at the AT&T-Time Warner merger court battle with the Justice Department turning to another media merger. How a past deal is playing a big role in this case, coming up next.

(COMMERCIAL BREAK)

[07:55:20] GREGORY: Attorneys focusing on a different merger in the AT&T-Time Warner trial as the Justice Department sues to block the telecom giant from acquiring Time Warner, which owns CNN.

Let's bring in CNN senior media correspondent and host of "RELIABLE SOURCES," Brian Stelter. And, "CNN POLITICS" media and business reporter Hadas Gold.

Hadas, bring us up-to-date on how -- we're talking about the NBC- Comcast deal. That was the last big merger in media land. How is that brought into the trial?

HADAS GOLD, MEDIA AND BUSINESS REPORTER, "CNN POLITICS": When NBC and Comcast merged, instead of a lawsuit between the Justice Department and the companies they entered into a settlement agreement that included certain conditions that the Justice Department said would keep them from being anti-competitive.

Now, the government lawyers are looking at internal communications that AT&T executives had in preparation for that settlement condition to expire, which happens this year. And they're saying that the arguments that AT&T were having internally about how those settlement conditions expiring would affect the industry are exactly the same arguments they're having against AT&T's merger with Time Warner.

They say that it will raise prices. That AT&T and Time Warner will somehow be able to keep their content hostage from other distributors. And they're saying that's what AT&T executives were talking about with Comcast and NBC.

Interestingly enough, the head of the antitrust division for the Justice Department, Makan Delrahim, was in court yesterday. I asked him if I should look into whether he was there on the day that we're talking about Comcast and he said no, I'm just here when I can get here and this is -- you know, I'm coming here to support our team.

But interestingly enough, the last time he was in court was when a Comcast executive was testifying so a lot of people are connecting the dots there.

GREGORY: So, Brian, if we look at the comparisons, anybody who's watching and still wants to know what's it going to mean in terms of access to content and prices that I have to pay -- and there is, of course, the political backdrop in Washington of all this as there was in that merger as well, which was also about just media getting too big and monopolistic.

BRIAN STELTER, CNN SENIOR MEDIA CORRESPONDENT, HOST, CNN "RELIABLE SOURCES": Yes. The Obama administration did approve Comcast-NBC almost 10 years ago at this point, but with the conditions that Hadas was describing.

The world has changed quite a bit since then, though. You think about the rise of Netflix, the popularity of Facebook and Snapchat and other social networking sites.

The tech giants have become bigger and bigger. That's why companies like Time Warner and AT&T, including -- and rivals like Verizon -- feel they need to get bigger -- feel they need to buy more content and have more muscle in the marketplace.

You know, Comcast-NBC owned big stations like Bravo and E! and, of course, the NBC broadcast network. This deal's a little different. It's about HBO, and CNN, and TNT, and Warner Brothers. But, you think about what these companies can do when they get together.

Your phone can be smarter. Your phone can connect maybe more directly and you can stream shows from your T.V. set to your phone, to your iPad. Those sorts of -- that kind of connectivity is what's behind the Comcast deal and what's behind the AT&T-Time Warner deal.

The argument though we're hearing in court from the government side is that owning Time Warner will give AT&T too much power in the marketplace with a company that will use hardball tactics against its rivals. It's a similar argument that we were hearing about Comcast- NBC almost a decade ago.

GREGORY: All right. Well, we'll be following the trial every day.

Hadas and Brian, thank you so much.

STELTER: Thanks.

CAMEROTA: We're following a lot of news so let's get right to it.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: For many years, no president wanted to go against China. We're going to do it.

UNIDENTIFIED MALE: The Chinese government has called this a provocation.

UNIDENTIFIED MALE: I think it's very unfortunate. I don't see many winners in any trade war.

TRUMP: I just left coal and energy country. They love Scott Pruitt.

UNIDENTIFIED FEMALE: The Republican Congress continues to give this administration a pass.

HOGAN GIDLEY, WHITE HOUSE DEPUTY PRESS SECRETARY: The president demands ethical behavior. We're looking into this.

UNIDENTIFIED FEMALE: Do you know where he got the money to make that payment?

TRUMP: No, I don't know.

UNIDENTIFIED MALE: When he tells the reporters go talk to my lawyers, it's an invitation to go drive right into the attorney-client privilege.

UNIDENTIFIED MALE: He's put himself and he's put Mr. Cohen in a world of hurt. If he caves, the administration could be in a very bad place.

(END VIDEO CLIP)

ANNOUNCER: This is NEW DAY with Chris Cuomo and Alisyn Camerota.

CAMEROTA: Good morning, everyone. Welcome to your NEW DAY. It is Friday, April sixth, 8:00 in the east.

David Gregory is with me. Happy Friday.

GREGORY: Yes.

CAMEROTA: One more hour until you --

GREGORY: And a lot of news this hour, too. It keeps rolling.

CAMEROTA: Oh, my gosh. We have breaking news every hour.

So, President Trump is amping up the rhetoric, now threatening China with an additional $100 billion in tariffs. Beijing is now vowing to fight the U.S. quote "at any cost."

And the White House is facing a growing ethics scandal involving the president's cabinet. Sources tell CNN that officials at the EPA were demoted or were sidelined after raising concerns about Sec. Scott Pruitt's spending.

Despite Pruitt's mounting ethical issues, CNN has learned that President Trump floated the idea of having Pruitt replace Attorney General Jeff Sessions.

GREGORY: New this morning, the president just gave a radio interview and he is making news.