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EARLY START

Ten-Term NY Dem Congressman Falls in Major Upset; Judge: Reunify Families Within Weeks; FBI Agent Peter Strzok Before Congress. Aired 4:30-5a ET

Aired June 27, 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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[04:30:40] ALEXANDRIA OCASIO-CORTEZ (D), NEW YORK CONGRESSIONAL NOMINEE: I cannot put this into words.

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CHRISTINE ROMANS, CNN ANCHOR: An election stunner in New York. A ten-term incumbent sent home by an upstart Democratic socialist. Democratic leadership now scrambling for a way forward.

DAVE BRIGGS, CNN ANCHOR: Hours after the president's travel ban was upheld, a new legal battle on immigration. A federal judge says all families separated at the southern border have to be reunified fast.

ROMANS: The FBI agent at the center of President Trump's conspiracy theory will finally face lawmakers. Peter Strzok behind closed doors with the House Judiciary Committee.

Welcome back to EARLY START, everyone. Good morning. I'm Christine Romans.

BRIGGS: I'm Dave Briggs, 4:31 Eastern Time.

Did Crowley get Cantored? Is this a bellwether? What happening in the Democratic Party?

It's the biggest upset of the political season thus far. Ten-term incumbent Democratic Joe Crowley ousted in New York's 14th district primary by Democratic socialist Alexandria Ocasio-Cortez. The 28- year-old Latina trouncing Crowley in her first political campaign.

Congressman Crowley is the fourth ranked Democrat on the House leadership. Two Democratic lawmakers said tonight the upset significantly alters the competition for the speaker's gavel if Democrats take the House.

ROMANS: Ocasio-Cortez ran defiantly to Crowley's left with demands for universal health care, a federal jobs guarantee, and abolishing ICE, Immigration and Customs Enforcement.

Crowley leaned heavily on his stage as a veteran liberal, but Ocasio- Cortez was not deterred.

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OCASIO-CORTEZ: It's surreal. I did not see these numbers until I walked in right now. I saw these numbers on television with you, so I'm still processing a lot of this.

Working-class Americans want a clear champion and there is nothing radical about moral clarity in 2018.

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ROMANS: Ocasio-Cortez is now likely to be the youngest woman ever elected to the House, 28 years old. She -- Crowley out-raised her 10- 1 and hadn't faced a primary opponent in 14 years. He was gracious in defeat and said he will keep his word backing her in the general election.

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REP. JOE CROWLEY (D), NEW YORK: We have a great opportunity this fall in November to win back the House, and although I maybe -- I maybe sacrificed a little morally in that cause, I'm committed to that end.

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BRIGGS: President Trump clearly paying attention to the race, tweeting overnight, wow, big Trump hater, Congressman Joe Crowley, who many expected was going to take Nancy Pelosi's place, just lost his primary election, in other words, he's out. That's a big one nobody saw happening. Perhaps we should have been nicer and more respectful to his president.

Joining us this morning, CNN politics senior writer and analyst Harry Enten.

Harry, I will not ask you to analyze that tweet --

HARRY ENTEN, CNN POLITICS SENIOR WRITER: I wanted to. Part of it was right, no one saw coming. The other part --

BRIGGS: That part was correct. But Tip O'Neill did say all politics is local. Is this a national l bellwether or is this just a local race where Joe Crowley did not pay attention to his voters and the demographics shifted?

ENTEN: I think part of that is correct. The demographics definitely shifted in that district. That is now a majority minority district, Joe Crowley representing a district that's 68 percent nonwhite. And he's obviously a white male.

That was going to be a problem heading into this primary. So, that's definitely the case. But I do think there are some lessons that we can take and apply them more nationally.

ROMANS: Like what? ENTEN: I think number one, it's the year of the woman. Two, the

Democratic Party is becoming younger, 18 to 29-year-olds and want power -- they want more progressive politics. The Democratic Party is becoming much more liberal. Over 50 percent of Democratic voters now identify as liberal according to Gallup.

And more than that, they are looking for a voice that perhaps is more independent from the establishment. Democrats now identify more as independents than they have pretty much at any point recently.

ROMANS: What's this to say about the leadership for the Democrats at this point? I mean, you have a big shakeup for Democratic leadership here. And where is the pipeline for these young women, progressive Democrats?

ENTEN: That's exactly right. Look at the Democratic leadership in Congress. You have Chuck Schumer, born in 1950. Nancy Pelosi was born before that. And Joe Crowley was the youngest, I think born in 1962.

So I think there was this real want for young leadership, and I think that the primary result here is an indication of that.

[04:35:04] BRIGGS: Interesting statement from the National Republican Congressional Committee. House Democrats hoping for a post-Pelosi era are now left leaderless. The only person happier tonight than Nancy Pelosi is the NRCC.

But let me ask you about the notion of a blue wave and all the energy on the left. Four years ago, 67,000 people vote. Only 27,000 turned out last night. Where's the energy at all on the left in terms of the turnout?

ENTEN: I -- you know, I would say, look, this is a congressional primary that is happening in late June. New York is one of the few states that has two primaries, one for state politics, one for federal politics. So, the fact that there was a lower turnout to me isn't that surprising. I think the fact that you saw so many voters voting against Joe Crowley I think is a big story no matter what.

ROMANS: We'll talk about Mitt Romney in Utah, all but the senator from that state, he won that handily, that primary. What is -- what kind of a leader is he going to be if he makes it into -- which everyone assume he'll make it into the Senate?

ENTEN: I think he'll certainly be someone more anti-Trump than most Republicans. He'll still vote with Trump a number of times, especially on issues they agree with. Keep in mind, Utah is a state that Mitt Romney won by about 50 percent points in 2012. Donald Trump only won it by about 20 points in 2016.

If there's one state in the nation where you can be an anti-Trump Republican or at least give him a kick in the butt sometimes, it's definitely Utah.

BRIGGS: A very gracious tweet, though, from President Trump about Mitt Romney and his family. So, clearly, they are aligned for the moment. It was a good night for President Trump overall, wasn't it?

ENTEN: It definitely was. South Carolina runoff, McMaster, the current governor, Trump endorsed him. He won.

Look at New York's 11th district. GOP primary, Dan Donovan, Trump endorsed, he won. And Mitt Romney, Trump did endorse him -- although I don't think that put him over the --

ROMANS: The third version of Trump's travel ban upheld by the Supreme Court. It was a good day for the president overall. I mean, if he wants his instincts to be vindicated, they were yesterday.

ENTEN: It was a good day for Donald Trump. Let's put it that way.

ROMANS: All right. Harry Enten, nice to see you. Come back.

ENTEN: Thank you.

ROMANS: Breaking overnight, a federal judge ordering the reunification of families separated at the U.S.-Mexico border. San Diego Federal Judge Dana Sabraw ordered federal officials to stop detaining parents apart from their children unless the parent is unfit. The judge required the government to reunify parents with children under 5 within two weeks and ordered parents to be reunified with parents 5 and older within 30 days.

BRIGGS: The judge's order says in part, the unfortunate reality is that under the present system, might children are not accounted for with the same efficiency and accuracy as property. Certainly, that cannot satisfy requirements of due process. Health Secretary Alex Azar says only six kids have been reunited with the parents since the president's executive order last week to stop separations.

ROMANS: At the moment, confusion still reigns as authorities try to reunite more than 2,000 families. Multiple agencies including Homeland Security, Health and Human Services, the Justice Department share the responsibility. No single agency has said it is leading the way. And it only a handful of children have been reunited, I think six with their families.

BRIGGS: First Lady Melania Trump announced she will pay a second visit to immigration facilities sometime this week. A spokeswoman says Mrs. Trump is moved by what she is hearing and wants to continue to check on children.

ROMANS: All right. Thirty-eight minutes past the hour.

White House Press Secretary Sarah Sanders expected to receive Secret Service protection on a temporary basis beginning as early as today. The news coming just days after Sanders was asked to leave a Virginia restaurant because she worked for Trump, a move that's amplified a national conversation on civility. Sources say it is not known how long she will have the protection detail. Neither Sanders nor the Secret Service are commenting on the matter.

BRIGGS: Iowa Republican Congressman Steve King, a hard-liner on immigration, tells CNN he did not realize he re-tweeted a message from a self-described Nazi sympathizer. But he's also refusing to delete the tweet.

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STEVE KING (R), IOWA: I have no idea who he is. I don't know why we're giving him a world-famous name into the news. I'm not obligated to do a full background check on anybody.

I'm not deleting that because then you all pile on and say King had to apologize he was wrong, he knows he's guilty. I'm not. I don't feel guilty one bit. I'm human.

(END VIDEO CLIP)

BRIGGS: King says he only shared the message because it had a screenshot of a "Breitbart" article. He has a history of making inflammatory comments about immigrants and espouses some of the most extreme views on immigration of any member of the House Republican conference.

ROMANS: All right. A ruling that could embolden the president's hard-line stance on immigration. His travel ban upheld by the Supreme Court. But the justice who provided the swing vote with some words of caution for this president.

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BRIGGS: All right. All eyes on Capitol Hill today, a senior FBI agent Peter Strzok set to speak with lawmakers behind closed doors this morning.

Sources tell CNN he will appear voluntarily before the House Judiciary Committee. Chairman Bob Goodlatte lifted a subpoena, one he imposed even though Strzok already said he was willing to testify. President Trump and conservative backers have made Strzok and former FBI lawyer Lisa Page the heart of their claim. The bureau and justice department are biased against the president.

ROMANS: Strzok was removed from the Mueller investigation after it was found he and Page exchanged private text disparaging President Trump. In one of the texts, Strzok said, we'll stop Trump from becoming president.

The committee chairman stays Strzok will face a public hearing at a later date. Tomorrow, the committee hears from FBI Director Wray and Deputy Attorney General Rod Rosenstein. They will be questioned about the watchdog report on the probe of Hillary Clinton's email.

[04:45:00] BRIGGS: A potential Trump-Putin summit will be discussed when national security adviser John Bolton sits down with Russian Foreign Minister Sergey Lavrov today.

Matthew Chance live in Moscow with the latest on this.

Matthew, the timing could certainly be interesting just ahead of a NATO meeting.

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes, ahead of it or just after it, as well. I mean, the exact timing, Dave, hasn't been made clear yet. It's something they'll be discussing today. And the venue also hasn't been made clear, all sorts of options on the table.

The latest one according to U.S. officials is that they're discussing the possibility of Helsinki, which is the capital of Finland, very close to the Russian border, of course. So, either before or after, there's a question about what that would mean, what messaging would send, what the optics would be of a meeting between President Trump and Vladimir Putin of Russia, just before NATO summit in Brussels, which takes place in the 11th and the 12th of July.

Of course, whenever it happens, it's going to be extremely controversial because Vladimir Putin is isolated by much of the alliance countries, the Europeans and others for his actions in Ukraine and Syria. His military is accused of shooting down MH-17, killing everybody onboard, the Malaysian passenger airliner. More recently, the Russians have been accused of involvement in the poisoning of the Skripals in Britain for which many of their diplomats were expelled overseas.

So, however -- whenever the meeting happens, it is going to be extremely controversial.

BRIGGS: Indeed. You will pay attention to the optics there given the relationship between the president and Angela Merkel and others.

Matthew Chance live in Moscow. Thank you.

ROMANS: A vindication for President Trump. The third version of the travel ban, a version he once called watered down, has been upheld by the Supreme Court.

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DONALD TRUMP, PRESIDENT OF THE UNITED STATES: This is a great victory for our constitution. We have to be tough, and we have to be safe, and we have to be secure.

At a minimum, we have to make sure that we vet people coming into the country. We know who's coming in and we know where they're coming from. We just have to know who's coming here.

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ROMANS: The 5-4 ruling recognizes that the president has broad powers to restrict travel in the name of national security, and the majority essentially disregarded his campaign statements calling for a Muslim ban.

BRIGGS: The high court's swing vote, Justice Anthony Kennedy, sided with the majority, but sent a message to the president in a concurring opinion saying, quote, the very fact that an official may have broad discretion, discretion free from judicial scrutiny, makes it all the more imperative for him or her to adhere to the Constitution and its meaning and its promise. Many are waiting to see if Justice Kennedy will retire, giving President Trump a chance to replace him with an ideological conservative.

ROMANS: The high court ruling also a big win for Senate Majority Leader Mitch McConnell. In 2016 he blocked the nomination of President Obama's Supreme Court pick, Merrick Garland. That paved the way for President Trump to nominate Justice Neil Gorsuch who voted to uphold the travel ban. Now, that has left Democrats wondering what if.

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SEN. CORY BOOKER (D), NEW JERSEY: This is a moral moment in our country. What the Supreme Court decided today, it's not just wrong, it is dangerous. It makes us less safe and it undermines the values of our country.

REP. KEITH ELLISON (D), MINNESOTA: It sends a very ugly signal to people who -- who look at our country as a beacon of freedom and beacon of inclusion.

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BRIGGS: Steve Bannon, a strong advocate for the travel ban when he was White House chief strategist, tells "Axios" the decision is a big deal for the president's psyche, bolstering his certainty that his instincts are right and the haters are wrong. The travel ban restricts entry from seven countries including North Korea, but there is said to be little concern in the administration that the decision could hurt efforts to engage Pyongyang in denuclearization talks.

ROMANS: All right. President Trump threatening Harley-Davidson as it moves production overseas. Tariffs will make the bikes in the E.U. more expensive. The president tweeted that Harleys should never be built in another country, claiming they will be taxed like never before. They're moving production because they're trying to avoid the taxes.

It was unclear what taxes President Trump met or why the company would have to pay. Harley will continue to make bikes for American customers in the U.S. Trump has long championed Harley-Davidson as a model of American manufacturing. So, here's what he said about tariffs causing them to move --

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TRUMP: Harley-Davidson is using that as an excuse, and I don't like that. I've been very good to Harley-Davidson.

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ROMANS: Harley isn't the only company hurt by Trump's trade actions. Tariffs on imported steel could force the largest nail manufacturer to close. A spokesman for Mid Continent Nail said the company grew despite competition from China, but now --

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[04:50:03] JAMES GLASSMAN, SPOKESMAN, MID CONTINENT NAIL CORP: The administration comes in and slaps on this tariff. And it's able to do something that the Chinese never were able to do which is put this company on the brink of extinction.

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ROMANS: Unless the commerce department exempts midcontinent from tariffs, it will shut down by Labor Day or potentially may have to move to Mexico.

BRIGGS: You know, there are many days we say we're an n uncharted political territory, but the president, a conservative, a businessman, is saying a business, an American business must put loyalty to me ahead of its shareholders and its customers.

ROMANS: Fascinating.

BRIGGS: Because Harley doesn't want to raise prices. That's why, in part, they're doing this. They want to pay attention to shareholders.

ROMANS: Ironically, too, you know, Asia's a fast-growing market for Harley-Davidson. They earlier said they would start production in Thailand? Why, the president pulled out a TPP. So, under TPP, Harleys would have been protected from really high tariffs into the Asian market. So, now, they're going to make bikes in Asia to avoid thoe tariffs that could have been avoided if the U.S. stayed in TPP.

BRIGGS: Let us know what you think about that @earlystart on Twitter.

Ahead, the president took his shots. Now late-night hosts with their response.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We're still on to lunch?

UNIDENTIFIED MALE: Yes, where do you want to eat?

UNIDENTIFIED MALE: Red Hen?

UNIDENTIFIED MALE: Red Hen!

(END VIDEO CLIP)

BRIGGS: All right. More of the late-night team effort next.

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[04:56:00] TRUMP: Jimmy Fallon calls me up, looks like a lost soul. Jimmy, be a man. The guy on CBS is -- what a lowlife. But there's no talent. He's not

-- they're not like talented people.

(END VIDEO CLIP)

BRIGGS: President Trump at a rally in South Carolina Tuesday night bashing some of America's late-night hosts. Well, last night, they teamed up on a video conference call and responded.

(BEGIN VIDEO CLIP)

(PHONE RINGING)

UNIDENTIFIED MALE: Hey, lowlife.

UNIDENTIFIED MALE: Hey, lost soul. What are you up to? Be a man.

UNIDENTIFIED MALE: I'll try. What are you up to?

UNIDENTIFIED MALE: I'm busy having no talent.

UNIDENTIFIED MALE: Did you see Trump's rally last night?

UNIDENTIFIED MALE: Nope.

[04:25:00] UNIDENTIFIED MALE: Me either. I heard he said pretty bad stuff about us.

UNIDENTIFIED MALE: Really? That doesn't sound like him.

UNIDENTIFIED MALE: I heard him say we're no-talent, lowlife, lost souls.

UNIDENTIFIED MALE: Well, that's not right. That's Conan. Hold on, I'll get him.

UNIDENTIFIED MALE: Hey, guys, what's up?

(APPLAUSE)

UNIDENTIFIED MALE: President Trump said --

UNIDENTIFIED MALE: President who?

UNIDENTIFIED MALE: Trump.

UNIDENTIFIED MALE: Donald Trump. The real estate guy who sells steaks.

UNIDENTIFIED MALE: He's president?

UNIDENTIFIED MALE: Yes.

UNIDENTIFIED MALE: Wow. How's he doing?

UNIDENTIFIED MALE: Not so good. UNIDENTIFIED MALE: Oh. Guys, give him time, OK? And remember,

please, be civil. If we're not careful, this thing could start to get ugly.

(END VIDEO CLIP)

ROMANS: Let's check CNNMoney this morning.

Trade fears once again hitting markets. Global stocks, U.S. futures down right now. Wall Street got a small break yesterday, rebounding with energy stocks. Energy stocks rising along with oil prices. U.S. credit card jumped above $70 per barrel for the first time since May. The U.S. is demanding countries cut Iran oil imports by November. Global supply is already tight. Even with major oil-producing countries boosting production it may not be enough to make up the shortfall.

General Electric is shrinking again hoping to reverse a slump. G.E. was once considered a bellwether of the U.S. economy. Now, today, it's dealing with a cash crisis after years of bad deals. G.E. is selling more of its businesses, health care, and oil services, leaving it to focus on just aviation power and renewable energy.

G.E. hopes this will reward battered shareholders. G.E.'s stock lost almost half its value last year -- half of its value, G.E. yesterday it was removed from the Dow 30. G.E. was an original member.

How much money can a free game make? For the popular game "Fortnite" -- $318 million a month. That's how much revenue it made in May. Unlike other hit games, "Fortnite" doesn't cost 60 bucks. Instead, the free game relies on in-game purchase, and, do I know that.

And players are buying. A study found 69 percent of players spent money on things like customizing their avatar, spending an average $85 each. Mom, you like this skin, is this a good skin, mom?

BRIGGS: Oh, cannot get my son off that game. That same survey that said 69 percent of players make in-app purchase said that 30 percent- plus of students had missed class for "Fortnite," and a 20 percent of workers had missed work because of "Fortnite".

ROMANS: All right. If the "Fortnite" obsession is in your house, please, tweet us @earlystart.

BRIGGS: Yes, let us know your obsession.

EARLY START continues right now with a stunning win for Democrats.

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ALEXANDRIA OCASIO-CORTEZ (D), NEW YORK CONGRESSIONAL NOMINEE: I cannot put this into words.

(END VIDEO CLIP) ROMANS: An election stunner in New York. A ten-term incumbent sent home by an upstart Democratic socialist who's still paying her student loans. The Democratic leadership scrambling for a way forward.

BRIGGS: Hours after the president's travel ban was upheld, a new legal battle is brewing on immigration. A federal judge says all families separate at the southern border have to be reunified fast.

ROMANS: And the FBI agent at the center of the president's conspiracy theory will finally face lawmakers. Peter Strzok behind closed doors with the House Judiciary Committee.

Good morning, everyone. Welcome to EARLY START. I'm Christine Romans.