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EARLY START

Trump in Brussels For NATO Meeting; U.S. Readies New Tariffs on China; Trump Faces Allies As NATO Summit Begins; Trump Demands NATO Allies Step Up Defense Spending. Aired 3-3:30a ET

Aired July 11, 2018 - 03:00   ET

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


(BEGIN VIDEO CLIP)

DONALD TUSK, EUROPEAN COUNCIL PRESIDENT: America, appreciate your allies, after all you don't have that many.

(END VIDEO CLIP)

[03:00:19] ALEX MARQUARDT, CNN ANCHOR: Officials in Europe bracing for the worst-case scenario. The NATO Summit is under way right now. The President's opening salvo coming even before his plane landed in Brussels.

CHRISTINE ROMANS, CNN ANCHOR: Buckets pointing lower after the President escalates the trade war with China tariffs on another $200 billion of Chinese goods are on the way, everything from fruit to handbags, rain jackets and baseball gloves.

MARQUARDT: And as the World Cup final is set, France will play for the title. Will they play England or Croatia? We will find out today.

Good morning and welcome to "Early Start", I am Alex Marquardt in for Dave Briggs this morning.

ROMANS: And I'm Christine Romans, nice to see you.

MARQUARDT: Great to be back with you.

ROMANS: It is Wednesday, July 11th. It is 3:00 a.m. in the east, 9:00 a.m. in the Brussels where the NATO Summit is underway right now.

Presidents Trumps spoiling for a fight even before the NATO meetings get underway, taunting European allies just as Air Force One landed yesterday with tweets about defense spending and unfair trade practices. But the President's midair jabs came as no surprise to European leaders. They fear President Trump will follow through on threats to cut back on military protection for U.S. allies.

The European Counsel President had a stark warning for Mr. Trump.

(BEGIN VIDEO CLIP)

TUSK: America, appreciate your allies, after all you don't have that many.

(END VIDEO CLIP)

MARQUARDT: This NATO Summit comes just a few days ahead of President Trump's sit down with Vladimir Putin in Helsinki, which the president is already predicting will be what he called the easiest meeting of his week long trip overseas.

So, with the latest let's bring in International Diplomatic Editor Nic Robertson live at NATO headquarters.

Good morning Nic, this NATO meetings are just getting underway in a few hours time. And it does seem that the other members are girding themselves, not quite sure what President Trump is going to say or do.

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Doesn't it just? I mean, look, President Trump in a couple of hours is going to come face to face again with Angela Merkel, the German Chancellor, Justin Trudeau from Canada, Theresa May the British Prime Minister, President Emmanuel Macron from France, the very people just weeks ago at the G7 he essentially dissed.

So there's that tension that already exists. There's a tension on top of that because President Trump has sent this NATO allies letters. He has reminded them in his tweets on the plane on the way over that he expects them to pay the two percent of GDP on defense spending, many NATO relations on.

This is something President Trump is very strong about, even to the point of saying that he might be considering getting back payments from these NATO allies. So, that's the tension ahead of President Trump heading into the NATO meetings later today

And, of course, President Putin in Russia watching all of this. President Putin who enjoys seeing NATO divided will no doubt enjoy seeing President Trump of the back this what set to be a very divisive NATO summit here later in the week when they have the summit in Helsinki.

But some support for the NATO allies, that nonbinding vote by the Senate, 97 to 2 singling a very strong message of support for NATO despite all that noises and tweet so far from President Trump. Alex?

MARQUARDT: All right, Nic Robertson in Brussels there, thanks very much.

ROMANS: All right. Joining us this morning, CNN Global Affairs Analyst, David Rohde, Online News Director of "The New Yorker". Good morning.

So first of all, you know, the President with this sort of tirade against NATO on his way as just as he's landing. It seems as though he doesn't understand what the NATO commitment is, but the goals are two percent of GDP, for military spending, defense spending by the year 2024. He seems to think that there's some kind of a bank account, which they're not contributing to and America is footing the bill. That's incorrect.

DAVID ROHDE, ONLINE NEWS DIRECTOR, THE NEW YORKER: That is incorrect. He's exaggerating this dynamic. He does this on many issues. He talked about how, you know, that we're being cheated on trade with Europe, that we're paying for their defense. He said it was impossible for American farmers to sell goods to Europe. That is false. We sold $11 billion in American agricultural goods to Europe in 2017.

MARQUARDT: But, David, doesn't -- even if he's misstating or making this a little bit more convoluted, isn't there some truth of the fact that the countries of NATO were suppose to spend two percent of their GDP on defense? And at this point, there are only five out about 28 as we see in that chart right there that actually are doing that. So, the vast majority of these NATO countries are not living up to this goal, are they not?

ROHDE: That is correct. This is not a crisis still for NATO. This is not like some threat to American security because these countries are spending their money. He's creating a narrative you could say, so the same thing with immigration, you could say it's on the same thing with trade where, you know, this is a problem. These countries should spend more. They are spending more, but the way he's exaggerating it I think helps more than anyone else Vladimir Putin.

[03:05:14] ROMANS: Right. The President refusing to call Putin an adversary, you know, he had said that it will be the easiest meeting he's going to have with Vladimir Putin. Let's listen to the president asking a question about with some of the reporter that whether Putin is a friend or a foe.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Would you say Vladimir Putin is a friend or a foe?

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I really can't say right now, as far as I'm concerned, a competitor, a competitor. I think that getting along with Russia, getting along with China, getting along with others is a good thing, not a bad thing.

(END VIDEO CLIP)

ROMANS: So, this is the master stroke of negotiation that the President calls him a competitor not an adversary. Is that going to work?

ROHDE: I don't think it's going to work and I think, you know, Vladimir Putin has already won. I mean, look at what is happening, you know, the U.S. and NATO are divided.

Trump is talking about pulling American troops out of Germany. That has been Vladimir Putin's goal for years and most of all Western democracies look chaotic and weak. And this helps Putin's broader agenda of, you know, again, he's been trying to achieve this for years that Europe is weak, that democracies are hypocritical, you know, to pull American troops out of Europe. So, already, this is all helping I think Vladimir Putin.

MARQUARDT: So, he's essentially looking his jabs. I mean, he's been watching an American President, you know, of disrupting the western alliance and making his NATO allies feel very uncertain. And at the same time, you know, appearing to waltz into this, this is very high stakes meeting.

ROHDE: The more chaos inside NATO, the better for Vladimir Putin. And I'm not getting into collusion or saying that Trump is intentionally trying to help Putin. The more division in the United States, that helps Vladimir Putin as well.

It's just sort of remarkable. So, again, Trump's base maybe supports this, this narrative of everybody is ripping us off. But it's not, I think, helping the country as a whole. And I'm not sure this week is going to help the President.

I don't think for many Americans attacking NATO and looking so chummy with Vladimir Putin really helps the President politically. I don't understanding what he's doing --

ROMANS: The American ambassador of NATO spoke with Christiane Amanpour. This is what she said.

(BEGIN VIDEO CLIP)

KAY BAILEY HUTCHISON, U.S. AMBASSADOR TO NATO: I think the discord is music to Putin's ears, but I do think that coming from this summit which is allied is strong and is going to increase our deterrent capabilities. That is going to put President Trump in a very strong position with President Putin. And I think he will be tough with President Putin.

(END VIDEO CLIP)

ROMANS: Will we know if he's tough with President -- with Putin? I mean, they're going to have a meeting, just the two of them sort of behind closed doors. And will we know if he is tough on him?

RHODE: Again, I hope, you know, President Trump makes progress here. But if we look at what happened with North Korea, it was a completely vague agreement, a big photo opportunity, you know, great declarations of success by President Trump. And the North Korea, you know, processes sort of unraveling already. You know, Mike Pompeo just went to Pyongyang and the talks went, you know, terribly.

So, another big photo opportunity but, you know, it'll be unclear what he actually agrees to I think in these meetings.

MARQUARDT: Well, and a lot of people don't want Trump to be in that meeting alone, just for that purpose. Because they want --

ROMANS: Right.

MARQUARDT: -- you know, more adults in the room. We are waiting live pictures. That should be coming in momentarily with President Trump and the NATO Secretary-General, Jens Stoltenberg, that they're having a breakfast this morning. And then, in just a couple hours time and about four hours, the meetings will get under way right there in Brussels.

David Rhode, thank you very much.

ROMANS: Thank you. Talk to you soon.

MARQUARDT: All right, President Trump's next stop on Thursday after Brussels will be in the U.K., where there's a social media campaign now under way to insult President Trump musically before he arrives in London.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Don't want to be an American idiot.

(END VIDEO CLIP)

MARQUARDT: There's campaign taking place on Facebook, an effort to make the Green Day hit "American Idiot", which is released back in 2004, the number one song on the British charts by the time Trump lands.

And it is making some progress. The song climbing to number 18 yesterday. But with Britain as we mentioned now in the World Cup semifinals, that song "American Idiot" has to contend with a soccer anthem called three lions, which is also climbing the chart. So, we'll a strong push to get "American Idiot" to number one by Friday.

ROMANS: All right. The U.S. unveiling new tariffs on China, ramping up the trade war with Beijing. The U.S. preparing additional tariffs on $200 billion worth of Chinese goods. China calls this unacceptable, vowing to respond with necessary countermeasures but did not provide details.

It's shaking global stocks, Asia falling overnight. Dow futures down more than 200 points. This new round of tariffs also makes good out of a threat by President Trump last week.

[03:10:08] The U.S. slapped tariffs on $34 billion in Chinese goods punishment for China stealing U.S. trade secrets. China responded with tariffs in equal measure. President Trump threatened to hit another $200 billion in goods if there was retaliation from China.

These tariffs will hit thousands of products including consumer goods like handbags, refrigerators, furniture, apparel, mattresses. So far, the U.S. avoided targeting things most Americans buy. But the current scale, I think, makes that impossible now.

This announcement comes as Trump meets with those NATO allies. Many of whom he accuses also of unfair trade practices.

He tweeted yesterday that the U.S. has $151 billion trade deficit with Europe. But that -- they want us to happily defend them through NATO and nicely pay for it. The U.S. already hit the E.U. with tariffs on foreign steel and the E.U. retaliated. Now, the U.S. is threatening new tariffs on European cars.

It's so interesting because people who follow deficits and markets. The President thinks of a trade balance as a bank account, right?

MARQUARDT: Right.

ROMANS: If he thinks that is a bank account that has been empty of $151 billion and a lot of trade watchers point out, well, we bought stuff for that. So, it's not like we got nothing, you know, like there was --

MARQUARDT: Right. And that we're the victim here.

ROMANS: Right.

MARQUARDT: Here we go. These are the live pictures coming out of Brussels with the -- we're going to listen to President Trump.

(BEGIN VIDEO CLIP)

TRUMP: We have a very good relationship. Because of me, they've raised about $40 billion over the last year. So, I think the Secretary General likes Trump. He may be the only one but that's OK with me.

JENS STOLTENBERG, SECRETARY GENERAL, NATO: We will discuss for how we can make this summit success, showing that Europe and the North America is standing together and we will continue to focus on defense spending. We both have as the President just said.

The NATO allies have to invest -- has to invest more in defense and that's exactly what they're doing. So, that will be the main topic is to be discussed so we can make further progress on burden sharing minutes.

TRUMP: Over the last year, about $40 billion more has been given by other countries to help NATO but that's not nearly enough. The United States is paying far too much and other countries are not paying enough, especially some.

So, we're going to have a meeting on that and the secretary general has worked very hard on that. He understands the problem and hopefully we can get it resolved. This has been going on for decades, for decades. And it's disproportionate and not fair to the taxpayers of the United States. And we're going to make it fair. So, that will be it.

And I want just to compliment the Secretary General. He worked very hard on this problem. He understands it better than anybody. Thank you very much. Thank you.

(END VIDEO CLIP) MARQUARDT: Jens Stoltenberg there, the Secretary-General of NATO there discussing what the President and he are going to discuss before they -- as they go into the breakfast and hitting on the main gripe that the President has had from the campaign trail to the White House and honestly over to Europe, that the other partners are not pulling their own weight and admitting there that there needs to be --

ROMANS: Sure.

MARQUARDT: -- a greater burden sharing.

ROMANS: And the President taking the credit because of me. He said, there's already $40 million more committed to defense spending for NATO. All right.

MARQUARDT: And Stoltenberg likes him.

ROMANS: Yes.

MARQUARDT: And he may be the only one.

ROMANS: That may be true.

MARQUARDT: All right, well, more on that coming up the next few hours. The deadline in the meantime has come and gone for the government to reunite families with young kids who were taken at the border.

Now, the health secretary calls for -- call the care for immigrant kids an act of charity. That's coming up next.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

[03:17:56] STOLTENBERG: -- billion U.S. dollars until 2024. So, this is really adding some extra momentum. It helps and we are moving in the right direction. But we still have to do more, and that is what we're going to address after the summit later on today.

Let me also add that a strong NATO is good for the Europe and it's also good for the United States. The U.S. purpose (ph) in Europe helps to protect Europe, but it also helps the United States project power to the Middle East, to Africa. And I think also clout -- the military clout of Europe, the economic clout, the political clout also is helpful dealing with Russia.

And we look forward to the meeting you're going to have with Putin. And I think that leaders are also looking forward to your thoughts about the meeting with President that -- later on.

TRUMP: Well, I have to say, I think it's very sad when Germany makes a massive oil and gas deal with Russia, where you're supposed to be guarding against Russia, and Germany goes out and pays billions and billions of dollars a year to Russia. So, we're protecting Germany. We're protecting France. We're protecting all of these countries. And then numerous of the countries go out and make a pipeline deal with Russia, where they're paying billions of dollars into the coffers of Russia.

So we're supposed to protect you against Russia, but they're paying billions of dollars to Russia, and I think's that very inappropriate. And the former Chancellor of Germany is the head of the pipeline company that's supplying the gas. Ultimately, Germany will have almost 70 percent of their country controlled by Russia with natural gas.

So you tell me, is that appropriate? I mean, I've been complaining about this from the time I got in. It should've never been allowed to have happened. But Germany is totally controlled by Russia, because they will be getting from 60 to 70 percent of their energy from Russia and a new pipeline.

And you tell me if that's appropriate because I think it's appropriate because I think it's not, and I think it's a very bad thing for NATO and I don't think it should've happened. And I think we have to talk to Germany about it.

[03:20:11] On top of that, Germany is just paying a little bit over one percent, whereas the United States, in actual numbers, is paying 4.2 percent of a much larger GDP. So I think that inappropriate also. You know, we're protecting Germany, we're protecting France, we're protecting everybody. And yet, we're paying a lot of money to protect.

Now, this has been going on for decades. This has been brought up by other presidents, but other presidents never did anything about it because I don't think they understood it or they just didn't want to get involved.

But I have to bring it up, because I think it's very unfair to our country, it's very unfair to our taxpayers. And I think that these countries have to step it up, not over a 10 year period, they have to step it up immediately.

Germany is a rich country. They talk about they're going to increase to this tiny bit by 2030. Well, they could increase it immediately tomorrow and have not problem. I don't think it's fair to the United States.

So, we're going to have to do something because we're not going to put up with it. We can't put up with it and it's inappropriate.

So we have to talk about the billions and billions of dollars that's being paid to the country that we're supposed to be protecting you against. You know, everybody is talking about it all over the world. Let's say, well, wait a minute, we're supposed to be protecting you from Russia, but why are you paying billions of dollars to Russia for energy? Why are countries in NATO, namely Germany, having a large percentage of the energy needs paid, you know, to Russia and taken care of by Russia? Now, if you look at it, Germany is a captive of Russia because they supply. They got rid of their coal plants. They get rid of their nuclear. They're getting so much of the oil and gas from Russia. I think it's something that NATO has to look at. I think it's very inappropriate. You and I agreed that's inappropriate. I don't know what you can do about it now, but it certainly doesn't seem to make sense that they paid billions of dollars to Russia and now we have to defend them against Russia.

STOLTENBER: You know, NATO is an alliance of 29 nations, and there are sometimes differences and different views, and also some disagreements. And the gas pipeline from Russia to Germany is one issue where allies disagree. But the strength of NATO is that despite of these differences, we have always been able to unite around our core task, to protect and defend each other, because we understand that we are stronger together than apart.

I think that two World Wars and the Cold War taught us that we are stronger together than apart.

TRUMP: But how can you be together when a country is getting its energy from the person you want protection against or from the group that you want protection?

STOLTENBERG: Because we understand that when we stand together, also in dealing with Russia, we are stronger. I what we have seen is that --

TRUMP: No, you're just making Russia richer. You're not dealing with Russia. You're making Russia richer.

STOLTENBERG: Well, I think that even during the Cold War, NATO allies were trading with Russia, and then there have been disagreements about what kind of trade arrangements we should trade on.

TRUMP: I think trade is wonderful. I think energy is a whole different story. I think energy is a much different story than normal trade. And you have a country like Poland that won't accept the gas. You take a look at something that they don't want to accept it, because they don't want to be captive to Russia.

But Germany, as far as I'm concerned, is captive to Russia because it's getting so much of its energy from Russia. So we're supposed to protect Germany, but they're getting their energy from Russia. Explain that. And it can't be explained, you know that.

STOLTENBER: All right thank you, Pres, thank you.

(CROSSTALK)

(END VIDEOTAPE)

ROMANS: Addressing down from the President of the United States about German investments in Russia. So, NATO Secretary General.

MARQUARDT: Yes, that's not really how those things go ROMANS: No.

MARQUARDT: Those pleasantries went out the window immediately.

ROMANS: No.

MARQUARDT: And only this was supposed to be what they call a spray, a very nice pictures of, you know, pleasantries across the table.

ROMANS: Shaking hands.

MARQUARDT: And the President launching immediately into what essentially he came for, which was to get European countries to -- I'm sorry, NATO partners to step up and start paying more, specifically Germany.

ROMANS: Right.

MARQUARDT: He was only talking about Germany there. You could hear --

ROMANS: It's bad. It's not fair. We can't put up with it. We won't put up with it. It's inappropriate talking about our allies in such a way.

MARQUARDT: And Stoltenberg, the head of NATO trying to bring it back to defense and talking about how, you know, in the wake of the two World Wars and the Cold War that this was a crucial alliance. And Trump turning it into a discussion about economics, relationship between Germany and Russia. Let's bring back in David Rohde.

ROMANS: Is the President suggesting that none of our allies should be doing business with Russia?

[03:25:08] ROHDE: And I'm -- again, I want be respectful to President, I'm confused.

United States does $31 billion dollars in trade a year with Russia. Exxon invests in Russia. McDonald's invests in Russia. Ford has four plants in Russia. So, what is wrong about Germany having trade with Russia? And the President himself is meeting with Vladimir Putin to normalize relations and have trade with Russia.

So, that whole, you know, statement it was all quite confusing to me. His statement, again, about how past presidents have done nothing about NATO and he earlier talked about how the spending on NATO was up by, you know, $40 billion. It's actually up by $46 billion since 2015.

Two years of that increase occurred under Barack Obama. Anyway, it's a confusing statement. It's inaccurate. And I don't, you know, follow what he's wants the Europeans to do.

MARQUARDT: Right, but we just assume that the point he was trying to make was that Germany essentially isn't pulling its own weight. And it's going back to what we're talking about in terms of defense spending by each country. There's no more powerful country in Europe than Germany.

And they're spending about one and a half percent of GDP on defense spending while the U.S. spends about three and a half percent. The President there said 4.2, it's lower than that. But is that not the point that he's trying to make, the Germany in spite being such a powerhouse and having these deals where it's making a lot of money should not be paying more?

ROHDE: I agree and Germany should pay more. I just -- I don't understand what the President's point is about Russia.

Is Russia an enemy? You know, that we should be spending more money on or is, you know, and we should not be having any trade with? Or is Russia his friend that he keeps saying he wants to improve relations?

I agree with you on this point of Germany spending more. It's just it's this contradictory message, you know, about why is he then meeting with Vladimir Putin?

MARQUARDT: Right.

ROHDE: Why is he pushing for more American trade with Russia? You know, why is it a double-standard?

MARQUARDT: Right.

ROHDE: Why is it bad for Germany to have trade with Russia but good for the Trump administration to have trade with Russia?

ROMANS: I mean, he has said that easiest of his meetings will be with Vladimir Putin, which is a shocking statement if you're one of the allies who would like to be as Jens Stoltenberg said, stronger together after two World Wars and a Cold War than apart. Is there a negotiating strategy here?

ROHDE: I just, again, I have a (ph) respect for the President, I don't think this is going to work.

You know, he has bullied these leaders about trade and it's from China or a NATO allies. President Trump is very unpopular with the German public. This is not going to cause like Angela Merkel to top holder that caved in. He humiliated Justin Trudeau. That drove up Justin Trudeau's approval rating in Canada.

So the style of diplomacy, again I -- we'll see. And maybe it'll all turn around and the President will succeed domestically in abroad, but he's not cutting amazing deals by, you know, bullying his opponents abroad or at home so far.

MARQUARDT: And clearly, Stoltenberg there extremely defensive, he was not expecting any of that and that setting --

ROHDE: That's humiliating. That is humiliating.

I mean, people in Europe are watching this video also and we are all, in the end, in many ways people will tend to be nationalists and want to defend the honor of their own country.

That is insulting. And that does not help, you know, he's backing these leaders into a corner. They have to stand up to him. He did this to Justin Trudeau in Canada. He's doing it in Brussels with NATO allies.

ROMANS: For those of us who watched foreign policy and international trade and markets, you know, it can be kind of shocking his manner. He was elected by people in this country to rock the boat and he is rocking the boat. He does not do it the way other presidents have done it.

ROHDE: He is, but, -- and, again, you know, maybe I know many people agree with the President. There's just a lot of false narratives here, again, that were being completely ripped off by NATO that is lack of defense spending and somehow endangering American national security, that's not just true.

ROMANS: When you say there's not a crisis, its not as if Russia is going to roll across the boarder tomorrow and United States is going to defend all of these countries, there's not a crisis level of spending for NATO.

ROHDE: No, and there has been a $46 billion increase in spending, after President Bush and then President Obama pushed the Europeans to do this. They need to do more, but there has been a change over the last three years.

So, it's these false narratives he sense of crisis, whether it's again the invasion on the Southern border in terms of immigration, or they were being ripped off by Canada in trade.

ROMANS: It's only the kernel of truth in this though.

ROHDE: Correct.

ROMANS: And that's where really I think what resonates, there's always a little bit of something there that he extrapolates from.

ROHDE: But I don't think what he's doing is leading to solutions to these problems. And I hope I'm proven wrong. I hope we have a deal with North Korea. I hope there's a better trade agreement with Mexico and Canada. I hope NATO starts spending more, but so far it's a lot of turmoil.

And again, it's all about the economy you've talked about this a lot. You know, this could hurt markets and hurt the American economy I fear.

MARQUARDT: And we've got our Nic Robertson over there in Brussels at NATO headquarters. Do we have him?

ROMANS: Hey Nic, are you there?

ROBERTSON: I am, and Dave good morning again.

ROMANS: Hi, good morning.

MARQUARDT: Good morning Nic.

ROMANS: What do you make of that piece of tape we just watched?