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President Trump Considers U.S. Troop Reduction in South Korea; U.S.-China Trade Talks Wrapping Up in Beijing; Aired 4-4:30a ET

Aired May 4, 2018 - 04:00   ET



[04:00:12] SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: I can't get into the details of the ongoing litigation. I have given the best information I had at the time. Again, I gave you the best information that I had. I gave you the best information that I had.


DAVE BRIGS, CNN ANCHOR: Struggling. The White House indeed struggling for words after Rudy Giuliani admitted the president paid back the Stormy Daniels hush money. Now anger in the building on the president's legal team.

CHRISTINE ROMANS, CNN ANCHOR: South Korea's top National Security official is in Washington ahead of nuclear talks with North Korea. Now President Trump reportedly taking steps to explore reducing the U.S. Military presence in the South.

BRIGGS: And mandatory evacuations in Hawaii as the Kilauea volcano erupts. Emergency resources being deployed as lava now heads for residential areas. Look at those pictures.

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

ROMANS: You thought we're going to have a tough day on a Friday.

BRIGGS: Indeed.

ROMANS: I'm Christine Romans. It's Friday, May 4th. May the 4th be with you.

BRIGGS: "Star Wars" day, my friend.

ROMANS: That's right. It's 4:00 a.m. in the East.

All right. Trump attorney Rudy Giuliani seems to have thrown a wrench into the president's legal strategy. Multiple sources tell CNN Trump's other legal advisers felt blindsided, angry, confused when Rudy Giuliani revealed the president reimbursed his lawyer and fixer Michael Cohen for a hush payment to porn star Stormy Daniels. That remark contradicted previous explanations by the president and Michael Cohen.

Giuliani told CNN Thursday he and the president are on the same page, aiming to, quote, "get everything wrapped up and done with, so that this doesn't take on a life of its own."

BRIGGS: Well, the White House is struggling to explain away the contradiction after the president spent months denying he knew about the hush money or the reimbursement.


JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: The president did talk about monthly retainers in his tweet and then Rudy Giuliani said that the president only knew about this 10 days to two weeks ago.

How can you only be aware of something 10 days to two weeks ago, but at the same time, in process of paying monthly retainers that apparently cover this reimbursement to Michael Cohen?

SANDERS: Again, I can't get into the details of the ongoing litigation. I'd refer you back to the president's outside counsel.

ACOSTA: If I could follow up on, you said on March 7th, there was no knowledge of any payments from the president. And he's denied all of these allegations. Were you lying to us at the time or were you in the dark?

SANDERS: The president has denied and continues to deny the underlying claim. And again, I've given the best information I had at the time.


ACOSTA: Why can't you just say whether you were in the dark? I think it's a fairly simple question whether you didn't have any information at the time.

SANDERS: I think it's a fairly answer that I've given you actually several times now.


BRIGGS: On Thursday, the president confirmed the hush payment and the reimbursement in a series of tweets while also denying any connection with presidential campaign. The source says the president's legal team is, quote, "calling it one play at a time," adding it's as if the players are executing the plays on their own.

Romans, how do you feel about that sports analogy?

ROMANS: That's interesting. All right. A lot of players.

Special Counsel Robert Mueller's office requesting blank subpoenas for 35 witnesses ahead of Paul Manafort's trial in Virginia. They will be used to line up witnesses and documents for Mueller's case against President Trump's former campaign manager starting July 10th.

Now blank subpoenas are standard practice when one side does not want to publicly reveal witnesses names and identities. Manafort is charged with money laundering, tax fraud and failing to register as a foreign agent in connection with lobbying for Ukraine.

BRIGGS: Another mess, actually a few more involving embattled EPA administrator Scott Pruitt. The "Atlantic" reporting a member of Pruitt's press team Michael Abboud has been shopping negative stories to the media about Interior Secretary Ryan Zinke to take the spotlight off of Pruitt.

Abboud reportedly telling members of the media an Interior staffer conspired with former EPA official to leak damaging information about the EPA. The spokesman for the agency calls the report categorically false.

ROMANS: Also developing this morning the "Washington Post" reporting Pruitt drew up a list of at least a dozen countries he hoped to visit once he became EPA administrator and enlisted the help of lobbyists and allies to make those trips happen. In at least on case a lobbyist traveling with Pruitt to Morocco got a contract with the host country.

BRIGGS: Also new this morning, a CNN analysis revealing Pruitt paid himself at least $65,000 from his two campaigns for Oklahoma attorney general. Records show Pruitt made purchases himself and received reimbursement from his campaign rather than having the campaign pay directly for the expenses. That makes it difficult to tell if the purchases were legitimate since there is so little detail in the campaign finance filings.

[04:05:02] The spokesman for Pruitt tells CNN the payments were, quote, "standard reimbursements."

ROMANS: All right. Reverend Pat Conroy back on the job as congressional chaplain after rescinding the resignation he submitted last month. House Speaker Paul Ryan accepting this decision. Ryan faced questions from Democrats and Republicans about asking the Jesuit priest to step down after nearly seven years of praying at the start of House sessions.

BRIGGS: Conroy says Ryan's chief of staff told him lawmakers wanted a chaplain who is not Catholic. The claim the chief of staff strongly denies. The speaker say he plans to meet with Father Conroy early next week. House minority leader Nancy Pelosi now demanding an explanation for Father Conroy's dismissal.

ROMANS: Yes. Republican lawmakers in Missouri will convene a special legislative session later this month to consider impeaching embattled GOP governor Eric Greitens. Statehouse and Senate leaders announcing the extraordinary move Thursday. There's been mounting pressure on the governor to resign over two criminal felony charges against him. Greitens also faces three separate investigations into his conduct. Missouri's Republican House speaker says they will not avoid doing what is right just because it's hard. The special impeachment session begins May 18th. It could last up to 30 days.

BRIGGS: The issue of guns front and center today as both President Trump and Vice President Pence address the National Rifle Association's convention in Dallas. The firearms industry has been fighting back against calls for stricter gun laws in the wake of the Parkland school massacre. Now you may recall the president told lawmakers not to fear the NRA then dialed back his own proposals after meeting with the gun lobby. Mr. Trump, the first sitting president in more than 30 years to speak to an NRA convention. This will be his second time doing so.

ROMANS: All right. Today the jobless rate may hit a level not seen in more than 17 years. We'll know in less than 4 1/2 hours when the Labor Department releases that closely watched jobs report. Economists expect the unemployment rate to fall to 4 percent in April. The lowest since December 2000. Right now it's at 4.1 percent.

It may not stop there. The Federal Reserve expects maybe 3.8 percent unemployment by the end of the year. Also expected the U.S. to add about 190,000 new jobs. Bouncing back from a bit of a slowdown in March. Wages should pick up as businesses struggle to find workers in what is a tight labor market. And economists say wages will climb a moderate 2.7 percent.

But other measures show a stronger picture. For example, private sector wages rose at the fastest pace in 11 years during the first quarter. Wages are a big focus for Wall Street, the market fell in January when wages rose at the fastest pace since 2009. Strong wage growth could mean inflation picking up, nudging the Federal Reserve to accelerate plans to raise interest rates. The Central Bank did not raise rates this week, but hinted that more hikes are on the way.

That's one of those cases where something that's good news for real people, higher wages turned out to be bad news in Wall Street because it means, you know, inflation could pick up.

BRIGGS: Yes. It's really tough to interpret.


BRIGGS: OK. Mandatory evacuations under way in Hawaii as the Kilauea volcano erupts releasing lava into a subdivision. The evacuations affecting 1700 people with almost 800 structures threatened. A woman who safely evacuated took this video. You can see lava in the distance spewing out of a crack in the street.

The governor has now expedited relief efforts and activated the Hawaii National Guard to help evacuations and security. The Red Cross has opened two shelters. The eruption comes after hundreds of earthquakes rocked the area since Monday. Those quakes have now slowed down.

ROMANS: Downside of paradise. Paradise.

BRIGGS: Terrifying.

ROMANS: Pack up your surf board and move along. Wow. Those pictures.

OK. All of you who use Twitter should change your password immediately. The glitch that's forcing 336 million people to make that change -- urgent change next.


[04:13:04] BRIGGS: Investigators hoping a genealogy Web site will help crack one of America's most mysterious unsolved cases. Authorities in California have been trying to hunt down the Zodiac killer for decades. The murderer has been definitively linked to five deaths in the late 1960s and early 1970s. The killer claimed more than 30 murders and set a series of bizarre and detailed letters to news organizations in which he called himself Zodiac.

You'll remember a genealogy Web site helped catch the Golden State Killer after he also evaded capture for decades.

ROMANS: Arizona school teaches returned to their classrooms this morning one day after the governor signed an education funding bill that gives them a 20 percent pay raise by the year 2020 including a 10 percent hike in the upcoming school year. The measure also increases funding for support staff, new textbooks, upgraded technology and infrastructure. The president of the Arizona Education Association says she is proud of this deal which ends a six-day walkout.

BRIGGS: Nearly 18 tons of ground beef recalled by a North Carolina food processor. The Department of Agriculture warned it might be contaminated with bits of hard plastic. JBS USA recalling all of the raw ground beef processed at its Lenoir, North Carolina, facility in late March. It was sent to retailers including Kroger's stores throughout the mid-Atlantic and Midwest. Packages have a sell-by-date of April 9th. But there is concern consumers could still have the product in their freezers. There have been no reports of adverse reactions thus far.

ROMANS: All right. Twitter is urging all of its 336 million users, every single one of them, to changes their passwords after it discovered a glitch causing user passwords to be saved unprotected on its internal computer system. The company says there is no evidence passwords have been leaked or misused. And the issue has been resolved but it would not say when the bug was discovered, how long it had been storing passwords incorrectly.

Twitter CEO says it was important to be open about the internal defect and their chief technology officer tweeted an apology.

[04:15:06] BRIGGS: Have you?

ROMANS: I know I'm going to do it.

BRIGGS: I have not. Like telling us to do this.

ROMANS: I can't remember my password.

BRIGGS: And we don't pick up the phone to do it.

ROMANS: It just opens because they're saved password. Now I've got to --

BRIGGS: I don't even know mine either.


BRIGGS: All right. Another round of tornadoes. Tearing through the Central Plains. At least 39 twisters have been reported since Monday. Today it could bring wind and hail storms as it threatens the northeast.

Meteorologist Ivan Cabrera with more.

IVAN CABRERA, AMS METEOROLOGIST: And good morning. We cannot go from 90s to 60s without a transition. The transition unfortunately will be some nasty thunderstorms I think for later today. We'll watch this very closely as damaging wind potentially is there. Large hail and even some isolated tornadoes with some of the cells that do develop. So we're talking where? Ohio through Pennsylvania, into New York and parts of New England as well with the thunderstorms really getting going between 3:00 and 7:00.

That will be a window for some of these storms to begin to take a toll here with some very frequent lightning. We also had the potential for hail as I mentioned and torrential downpours along with this frontal boundary.

What we have behind it is the cool air. So we're going from highs in the 90s in D.C. to highs in the 60s. You ready for that? That's going to be a shock to the system by Sunday. In New York, we'll see 86 today, and then 60s by the time we get into the middle part of next week. And we'll basically go back to normal for this time of year heading into the early part of the next workweek -- guys.

ROMANS: All right. Back to normal.

BRIGGS: All right. Ahead, President Trump reportedly orders the Pentagon to get ready to draw down American troops in South Korea. How it does and does not play into the coming nuclear talks with North Korea. Next.


[04:21:10] ROMANS: All right. The Nobel Prize in Literature is being postponed. For the first time the award will not be presented since World War II. The Swedish Academy, the group that awards the prize, has been mired in financial and sexual scandal in recent weeks. Six members of the Academy, including the head of the organization, Sara Danius, have stepped down in the wake of the controversies. A statement released today says the Nobel Foundation is supporting the decision. The postponed Nobel Prize will be awarded next year.

BRIGGS: National Security adviser John Bolton meets with South Korea's national security chief today in Washington, laying the groundwork for President Trump's planned summit with Kim Jong-un. Now the focus will be on location which is still much up in the air and on broader elements of the talks. This as "The New York Times" reports the president is ordering the Pentagon to prepare actions for reducing the number of U.S. troops in South Korea.

CNN's Alexandra Field live in Seoul this morning with the latest. Alex, this has long been a fear of several in the region. What's the

reaction there?

ALEXANDRA FIELD, CNN CORRESPONDENT: Well, and, Dave, they've all heard the president complain in the past about the cost of maintaining high levels of troops at in the Asia Pacific region. The question now, as you look ahead, is that if there is a peace treaty that would put an end to the Korean War formally 65 years after the fighting ended, would it be necessary to maintain the level of troops that are currently stationed here on the peninsula. You're talking about some 30,000 people.

Now in response to reports from the "New York Times" that the president is looking at his options, well, a source close to the administration said that this is a long-term consideration only. That this is the administration's thinking that this is something that could be looked at only well after nukes were verifiably gone from the Korean peninsula. At the same time officials here in South Korea are being told that -- are saying that they have been told directly by officials in Washington that the reports from "The New York Times" are simply untrue.

Earlier this week, we also heard from South Korean officials who were saying that the need for troops on the peninsula is linked to broader issues of regional stability and regional security. At the same time, Kim Jong-un continuing to say all the right things in the run-up to a possible sit-down with the U.S. president. He is again reaffirming his commitment to denuclearization in a meeting with the Chinese foreign minister.

The big question now, whether or not North Korea will have another show of good faith before that summit with the U.S. president. Will North Korea release those three U.S. detainees? There's been speculation in the last day to two that a release could be imminent. So far no way to confirm that that is in fact imminent. But a lot of hope for these family members that they could see some motions soon.


FIELD: That they could see their loved ones coming home soon. Uncertain, though -- Dave.

BRIGGS: All right. Alexandra Field, live for us in Seoul. Thank you.

ROMANS: All right. President Trump's top advisers wrapping up two days of trade talks in China. Leaders of the world's two largest economies threatening to impose billions of dollars in tariffs on each other's products. A breakthrough would require a fundamental change in China's economic policies and that is not considered likely.

Matt Rivers tracking the latest developments for us live from Beijing. And we know that there is, you know, two days of talks. They have to wrap this thing up today. We know what the U.S. wants. They want to cut the deficit with China. They want more access to Chinese markets. And they want the Chinese to do more to protect intellectual property. Any sense there is any headway on those things?

MATT RIVERS, CNN INTERNATIONAL CORRESPONDENT: So far, there's really been no public statements from either side, Christine. In fact really the only public statements that we've seen is a tamping down of expectations at this point with both sides saying look, you're probably not going to get both sides who are so far apart at this point on so many different issues to come to some sort of major bargain in the course of two days. But at the same time you do have to start somewhere. And there are very real consequences here.

You have tens of billions of dollars in threatened tariffs from the U.S. and the Chinese side. And that will hurt people on both sides of this debate, in China and in the United States. We know that those meetings are wrapping up.

[04:25:03] The U.S. delegation set to go back to the United States this evening here in Beijing. And at the same time, as all of that is happening, you also have a significant development in the South China Sea on the national security front. U.S. intelligence officials and the White House confirming that China has deployed -- highly likely deployed missiles in the South China Sea, in contested islands, artificial islands that China has built up. It's a further militarization for the Chinese in that part of the world.

That's something the White House says there will be long-term and short-term consequences for. They didn't lay out exactly what they're going to do there but you've got a lot of different issues between the U.S. and China right now making this relationship overall more and more tense -- Christine.

ROMANS: Yes. So interesting. And the U.S. ambassador to China is the former governor of Iowa where there are real concerns about the Chinese potentially retaliating against American soy bean. Just a fascinating set of players.

OK. Thanks so much for that, Matt.

BRIGGS: All right. The Pentagon claiming Chinese soldiers using military grade lasers to interfere with U.S. aircraft in Djibouti. U.S. and China both have bases in the East African nation. Defense Department officials claim multiple incidents involving a laser interference with two U.S. airmen sustaining minor eye injuries. The U.S. launching a formal diplomatic protest with Beijing and all U.S. airmen now being urged to use caution when flying in certain areas over east Djibouti.

ROMANS: Wow. All right. The shifting story on the Stormy Daniels payment leaving the White House with, you know, no good answers. Did Rudy Giuliani's admission about reimbursement put the president in more legal jeopardy?