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Trump Starts NATO Summit by Pressuring Allies, Publicly Calling Out Germany; U.S. Plans Tariffs on $200B More Chinese Goods. Aired 7-7:30a ET

Aired July 11, 2018 - 07:00   ET


ANNOUNCER: This is CNN breaking news.

[07:00:09] ALISYN CAMEROTA, CNN ANCHOR: All right. Good morning, everyone. Welcome to your NEW DAY. It has been a raucous start to the NATO summit in Brussels. President Trump is testing the limits of the most important alliance on earth. This is videotape you're looking at right now moments ago, of him arriving at headquarters there, NATO headquarters.

Earlier this morning, in the very first photo opportunity of the summit, President Trump demanded that NATO members spend more on defense. Here's just a moment of this.


DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: The United States is paying far too much, and other countries are not paying enough. It's disproportionate, and not fair to the taxpayers of the United States, and we're going to make it fair.

I think that these countries have to step it up, not over a ten-year period. They have to step it up immediately.


CAMEROTA: That was just the appetizer. OK? That was the amuse bouche right there. There's more to come, and we'll play it for you.

European leaders were bracing, of course, for tough talk from the president, but the tone and speed of his criticism right out of the gate seemed to catch some of them by surprise, especially the rhetoric towards the Germans.

JOHN BERMAN, CNN ANCHOR: Yes, it was the amuse bouche without the "amuse" part.

Sitting at that table, with the cameras rolling, the president accused the Germans of being held captive by Russia because of an energy deal between the two countries. This set off this tense, very public exchange for the whole world to see.

And this matters, because NATO has been one of the most important bulwarks to Soviet expansion, communism, now terrorism. It also matters because this discord is exactly the kind of thing that Vladimir Putin wants.

President Trump, as you saw, just arrived at NATO headquarters moments ago. He'll be face to face with German Chancellor Angela Merkel and other world leaders in just a few seconds. We will cover those moments for you live.

Let's begin our coverage with Kaitlan Collins. She joins us live from Brussels -- Kaitlan.

KAITLAN COLLINS, CNN WHITE HOUSE CORRESPONDENT: John, President Trump came out swinging. This is the first official day of the NATO summit, and to put this in perspective, as you just noted, President Trump just arrived here in the hall behind me. And so when he made these remarks about Germany this morning, he hadn't even officially arrived at the NATO headquarters.

They were still at the breakfast, which was supposed to be this traditional, ritualistic type breakfast, certainly not something where you're confronting the secretary-general of NATO, but that is what the president used that opportunity to do so. And he is confirming every European leader's worst fear, is that this is going to be a very hostile summit.


DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: I think that these countries have to step it up, not over a ten-year period. They have to step it up immediately.

COLLINS (voice-over): President Trump blasting America's top allies over defense spending at a breakfast kicking off this week's crucial NATO summit.

TRUMP: No other president brought it up like I bring it up. So something has to be done.

COLLINS: The president directing the brunt of his criticism at Germany, complaining that the U.S. is expected to defend Europe from Russia, despite Germany paying Russia billions for energy.

TRUMP: Germany is totally controlled by Russia, because they were getting from 60 to 70 percent of their energy from Russia in a new pipeline. And you tell me if that's appropriate, because I think it's not.

But Germany, as far as I'm concerned, is captive to Russia.

COLLINS: Germany's defense minister addressing criticism of their defense spending to CNN last night.

URSULA VON DER LEYEN, GERMAN DEFENSE MINISTER: This is a pipeline. This economic project started, I think, back in 2002 or '03, so way before Russia changed -- changed its behavior.

COLLINS: The head of NATO acknowledging that allies are starting to contribute more. JENS STOLTENBERG, SECRETARY-GENERAL, NATO: Last year was the biggest

increase in defense spending across Europe and Canada (ph) in a generation.

TRUMP: Why was that last year?

STOLTENBERG: It's also because of your leadership, and because of your message (ph).

COLLINS: But stressing to President Trump the importance of the alliance.

STOLTENBERG: The strength of NATO is that, despite these differences, we have always been able to unite around our core cause, to protect and defend each other, because we understand that we are stronger together.

COLLINS: The heated start to the summit coming after one senior European official told CNN that NATO members are preparing for the worst-case scenario, many leaders expressing fear that President Trump will follow through on the threat to pull U.S. military protection for countries who don't reach the 2 percent defense spending target, a goal they're supposed to hit by 2024.

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

COLLINS: Ahead of a trip to the U.K. later this week and his first official summit with Vladimir Putin, President Trump also talking aim at British Prime Minister Theresa May over the ongoing revolt within her party, but not directing any tough talk toward Putin.

TRUMP: I have NATO. I have the U.K., which is, in somewhat, turmoil. And I have Putin. Frankly, Putin may be the easiest of them all.

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

[07:05:04] TRUMP: I really can't say right now. As far as I'm concerned, a competitor. A competitor.

U.S. NATO Ambassador Kay Bailey Hutchison acknowledging that Moscow welcomes the growing divisions between the U.S. and the European alliance, but attempting to downplay concerns.

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.


COLLINS: Now the president's day just got kicked off. He's got an official greeting and a welcoming ceremony with the other leaders in the next few minutes, where he's going to come face to face with the German chancellor, Angela Merkel, for the first time since he made those very public criticisms this morning.

Now, the White House has confirmed that the president and Merkel will sit down one-on-one away from all the other leaders this afternoon, where they said that the president will bring up those criticisms that he made this morning, and Merkel said, in comments when she arrived here at the NATO headquarters, that she is also expecting some controversial discussions.

So needless to say here, John, this day is just getting started.

BERMAN: Yes, what will happen next?

CAMEROTA: What could go wrong with that one-on-one meeting.


CAMEROTA: Let's explore all that. Joining us now is Bobby Ghosh. He's an editor for "Bloomberg Opinion"; and CNN political analyst Karoun Demirjian.

Great to have both of you. Bobby, great to have you here in the studio. So the president vented his spleen at the allies about how he feels that the U.S. is being taken advantage of by NATO. What do you think the upshot of all of this is?

BOBBY GHOSH, EDITOR, "BLOOMBERG OPINION": Well, hopefully, the allies will finally get that this is -- this is Donald Trump.

For -- for about a year, and if you go back to the campaign before it, more than that, a lot of European leaders have been -- have been asking the question that many Americans had, that "Surely, this can't be for real. Surely, this is an act. Surely, this is man cannot actually believe the things he's saying. He's posturing for television."

Well, I think it's time for the Europeans to understand who he is (ph). What you see with Donald Trump is what you get, to use a very old-fashioned expression. That is -- this is Donald Trump. And they have to make their arrangements, whether they make a different defense arrangement for themselves, or they have to make an accommodation with -- with Donald Trump, this is for real. And it's time for the Europeans to understand this.

This is horrific. This is incredibly damaging, but this is for real.

BERMAN: President Trump is saying, "This is who I am, and stop calling me Shirley." All at the same time.

And Karon, look, you can say the president campaigned on this. He did. He talked about NATO. He talked about spending. You can say there's a legitimate gripe about NATO countries not spending as much on their defense budgets as quickly as some people would like to see.

However, this is all he focuses on. He talks about the defense budgets. He talks now this new area of attack, about Germany entering this oil deal with Russia. But he doesn't talk about the importance of the North Atlantic Treaty Organization. He doesn't talk about what NATO has done well for decades and decades, and he doesn't talk about the importance of maintaining this strong collective defense in the future. And that tone is something that is so noticeable to leaders around the world.

KAROUN DEMIRJIAN, CNN POLITICAL ANALYST: It's not just the tone. It's the absence of that part of the message existing at all. It has the allies very scared that it's because the president just does not value that part of the alliance and what it's worth, especially because, as he's saying, you know, things will be easier with Putin than they will be with the European countries. Especially when he's focusing on, you know -- there's an agreement about when the European countries in NATO are supposed to be stepping up their defense spending to 2 percent of their national income. And it's not tomorrow, and Trump doesn't seem to respect those agreements have been made.

So this is basically -- they are receiving a message loud and clear that this is not something that they can hang their hat on any more, at least not under this presidency. And if the -- if the purpose of all that is just kind of shake up the Europeans and make them a little bit scared, it seems to move beyond that point right now, because he's doubling down on that for the second year in a row, without any sort of kind -- kind language or reinforcing language about, as you said, you know, the ups, the perks, the beneficial side of this alliance.

JOHN AVLON, CNN POLITICAL ANALYST: This is not a negotiating tactic. This is a statement of sincere impulse on his part. And there is a cost and a consequence to not knowing about history and caring about American leadership in this role.

But Kay Bailey Hutchison, his NATO ambassador, today said America -- the discord coming out of the president is music to Putin's ears. And that's the answer of who's -- who benefits from all this.

You know, he can talk about -- about Germany. He can talk about it, and he's talked about it for decades, about people not paying their fair share in these international institutions. But at the end of the day, by fixating so pointedly and going after a key ally when he is silent about Vladimir Putin -- if he still hasn't made up his mind whether or Putin is a friend or foe, well, everybody else has, based on objective evidence.

[07:10:03] So that's the problem. There is an absence of American leadership, but it's more than that. It seems to be malevolence towards key allies.

CAMEROTA: And yet, Bobby, the words that he's said about Russia were some of the most critical, or at least, ostensibly critical, yesterday that we have heard. In fact, some of our guests have called it schizophrenic, about is Russia a friend or a foe? And it was hard to tell from President Trump going after Germany, by way of Russia. So listen to what he said about this.

(BEGIN VIDEO CLIP) TRUMP: Germany is totally controlled by Russia. Because they were 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 not. And I think it's a very bad thing for NATO, and I don't think it should have happened. And I think we have to talk to Germany about it.


CAMEROTA: So which one is it? Is Russia a bad actor or is Russia not a bad actor?

GHOSH: I don't think -- I don't think he's -- in that particular instance, I don't think he's suggesting Russia is a bad actor. He's trying to give the lie to the NATO argument.

Look, his views on Russia are right there. There's a vast body of rhetoric from him that, you know, Putin is fine, everything is fine. He's a tough guy. He's --

CAMEROTA: Of course there is. That's why that one sounded off-script from him usually. Saying it's not appropriate to do a deal with Russia?

GHOSH: I don't think that's what he's saying. He's saying it's not appropriate, then, to claim that we have to protect you from Russia.

BERMAN: Right.

GHOSH: That's what he's saying. He's not saying you shouldn't be buying fuel from Russia. He's saying, how come you're buying all this fuel from Russia and then you're expecting us to protect you from them?

AVLON: Yes. I think Bobby -- Bobby's right. And look, there are legitimate issues about, for example, former German Chancellor Gerhard Schroder, who works for Russian gas and oil companies and is very tight with Putin. But instead, he's directing his fire at Angela Merkel.

And don't forget: Obama and Merkel had, actually, the closest of relationships. And now the contrast could not be clearer. He's directing his fire at her, not Putin.

BERMAN: And I think Karoun has got a great point here. We talk about the tone. And I think you correctly said, Karoun, it's about more than tone. It's about the commitment.

NATO, by definition, is a commitment to mutual defense. And the minute you question that commitment, the minute you doubt that commitment, it all comes crumbling down.

And I think you could see -- and if we have this video, it would be interesting to see. John Kelly, the chief of staff, who spent his life as a general. Also Mike Pompeo, a veteran, the secretary of state, sitting next to him. I want you to look at their faces, and look at how many drinks of water --

CAMEROTA: That's vodka.

BERMAN: -- the chief of staff needs --

CAMEROTA: That's vodka right there.

BERMAN: -- while the president is talking about this.

AVLON: And it's breakfast.


TRUMP: You tell me if that's appropriate, because I think it's not. And I think it's a very bad for NATO.


BERMAN: Well, you see, John Kelly there, you know, shrugged --

CAMEROTA: I like a good body language segment.

BERMAN: -- looked away. He's like, "Oh, boy. Here we go again."

AVLON: Oh, boy.

BERMAN: You know, you get the sense that they were not comfortable with the president's views on this alliance, Karoun.

DEMIRJIAN: I think the president's rhetoric on NATO, much like the president's rhetoric on whether Russia interfered in the 2016 U.S. presidential election, does not match with the rest of his administration, does not match with the rest of the GOP.

It is something where he's just out of lock step with everybody around him, everybody who's advising him, who want him to just say a few simple things. Russia meddles in the election; NATO is a good alliance to have. And he doesn't go there. And he never goes there.

And -- and this is -- look, what the president is articulating, when he's talking about, you know, why is Germany doing a deal with Russia, that's a legitimate grievance the United States can have with European nations, which are much more economically linked. How do you expect us to go so hard after Russia if you're not willing to meet us every step of the way?

But to make that argument, you have to say we have to actually be in this fight with you, which the president is not saying when he starts to talk about NATO in disparaging terms. And he's -- and he's doing that, clearly, over the advice of everybody who's around him. And we're talking about the most conservative Republicans and even his allies at this point still think that you should be reaffirming the commitment to that alliance. And the president's just not echoing that sort of tone.

CAMEROTA: President Trump is, however, taking credit for the conversation happening, for the fact that some of the NATO allies are going to be paying more, even though they agreed to in 2014. But still, he has brought the issue to the fore, and he wants credit for it. Here is that moment when he's saying "and who do you have to thank?"


JENS STOLTENBERG, NATO SECRETARY-GENERAL: The good news is that the allies have started to invest more in defense. After the age of cutting defense spending, they're started to add vehemence (ph) to defense spending. And last year was the biggest increase in defense spending across Europe and Canada (ph) in a generation.

TRUMP: Why was that last year?

STOLTENBERG: It's also because of your leadership, and because of your message (ph). And --

TRUMP: They won't write that.



CAMEROTA: Secretary Stoltenberg is willing to give him that, in part, partial credit.

GHOSH: Yes, he certainly brought it to the top of the list of things that they're going to discuss at every meeting with NATO. But the point you made, that these are commitments that were made in 2014. Their giving credit to Donald Trump is mostly window dressing. They're trying to appease him. They've seen from -- from other instances that he responds well to this kind of this.

But I think they're too far gone with Donald Trump for this to work as a way of softening him up.


[07:15:15] BERMAN: When you look at this, Bobby, are you 100 percent certain, as you watch and listen to what the president says, that he really wants the U.S. to be part of NATO forever?

GHOSH: He -- he wants NATO to pay more. He wants to have his cake and eat it, too. He wants the United States to have a dominant position in Europe. At the same time, pay a much smaller portion of the bill. This's the real-estate man's view of things -- pay less, get more. This has -- this is who he has been his entire business career.

BERMAN: Bobby, Karoun, thanks very much.

Tomorrow I'm going to be in London. The president's in Brussels right now. He continues his European tour tomorrow in England, where he will meet with the prime minister there, someone he has also somewhat criticized a little bit over the last few days. CAMEROTA: That, too, will be interesting.

Meanwhile we do have some more breaking news for you. This morning, the U.S. unveiling new tariffs on China and Beijing vowing to respond, ramping up the trade war.

CNN chief business correspondent Christine Romans has been watching all of these developments. She's in our "Money Center." What do you see, Christine?


You know, an additional 10 percent tariff on $200 billion in Chinese goods, that's what the U.S. is planning here, targeting thousands of products, including now consumer goods: handbags, refrigerators, furniture, apparel, mattresses.

You know, so far the U.S. has avoided hitting things most Americans buy, but the current scale of the U.S. plans of $250 billion now in tariffs makes that nearly impossible. It will have to be consumer goods, too.

China quickly shot back, calling the tariffs unacceptable and vowed to respond.

Two hundred billion dollars is much more than China imports from the U.S. So it can't impose equal tariffs, those retaliation. It can hit back through what it said were qualitative measures. That means stricter inspections or investment delays for U.S. businesses, or consumer boycotts.

This also makes good on a threat by President Trump last week. You know, the U.S. slapped tariffs on $34 billion in Chinese goods. That was punishment for China stealing U.S. trade secrets. President Trump threatened to hit another $200 billion if China retaliated. China did. Now here you've got this -- this new list.

Renewed trade tensions are shaking global stocks, you guys. Asia and Europe falling overnight, Dow futures down more than 200 points right now, John.

So here we go. We're in the early stages of this. Don't know exactly how it's going to hit the economy quite yet, but the U.S. is saying China doesn't play fair, and this is how the U.S. is going to respond.

BERMAN: A lot of red there in the world markets this morning. We're keeping our eye on that. Christine Romans, thanks very, very much.

In the meantime, President Trump has arrived in Brussels at the NATO summit. You're looking at what's called the blue carpet right now.

CAMEROTA: Wow, riveting.

BERMAN: This is where all the leaders will be appearing shortly when they meet face to face for the first time. How will those interactions go? Stay with us.

CAMEROTA: Why is it called the blue one?


[07:21:46] BERMAN: President Trump blasting America's allies before breakfast even served at NATO. Listen as the president takes aim at Germany.


TRUMP: Germany is a captive of Russia, because they supply. They got rid of their coal plants. They got 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 agree that it's inappropriate. I don't know what you can do about it now, but it certainly doesn't seem to make sense that they pay billions of dollars to Russia, and now we have to defend them against Russia.


BERMAN: All right. Let's get reaction now from independent Senator Angus King of Maine.

Senator, thanks so much for being with us.

Again, as breakfast was being served, the president said that NATO members have to spend more on defense and said that Germany shouldn't be in this oil deal with Russia, directly criticizing American allies. Does he have a point, though, on those two subjects?

SEN. ANGUS KING (I), MAINE: Well, he does. I mean, presidents since Eisenhower have been complaining about the European countries not paying enough as their own defense through NATO, so there's no question that there is an issue there.

They started in 2014, before President Trump was president, to increase their payments, principally because of the -- the invasion of Crimea and Ukraine. So that's a problem.

And also, the -- the deal with Russia on natural gas, although I think the president overstated it. He said something like 60 or 70 percent of their energy. My understanding is it's more like 20 percent. But clearly, it's a concern. And I think it's reasonable to raise it.

The question is how do you raise it? And the real overriding importance of this summit is unity in the face of newfound Russian aggression throughout Europe and the Middle East.

So to -- to take the "how much are you paying" argument, which by the way, is already improving, and turn it into a kind of make-or-break deal, it's -- it's like turning a family squabble into divorce proceedings. The most important thing we have right now is to show the unity of the NATO alliance, not pick at pieces where there are criticisms.

Also, the energy deal isn't part of NATO. It doesn't really have much to do with NATO It's -- it's an economic deal that Germany has made to get natural gas. I do think it's a concern. I think it's something that the Germans have been wrestling with. But again, this deal, this pipeline arrangement goes back, I think, to 2002 when everybody viewed Russia in a more benign way, shall I say.

BERMAN: It was well before the invasion and occupation of Crime, to be sure.

You say unity is the most important thing here. Do you see any evidence the president is committed to NATO unity? Do you see any evidence the president is committed to standing up to Russian aggression?

KING: Well, I think it's a little early. All we've had is a breakfast, so let's see how the meeting goes the rest of the day. But certainly, his tweets on the airplane on the way over, criticizing the payments.

And as I say, it's a legitimate issue, but do you threaten the underlying structure of a -- of a system, the NATO system, that has preserved the peace in Europe?

Here's an interesting fact. The period since NATO began is the longest period without war in European history since 1500. So it's an important structure. And again, let's question it, let's push and pull, but not to the point of insulting our allies and threatening the unity of the entire enterprise.

[07:25:15] BERMAN: You say it's early still, but as you said, we've seen the statements from the president leading up on the plane. We've also seen the statements from the president in the last 18 months while he's been in office, and we saw the statements during the campaign. Is there evidence that he values this organization?

KING: I don't -- I mean, he made statements during the campaign that were really worrisome. As you recall, he -- he sort of didn't endorse Article V, which is where NATO comes together for self-defense. He then pushed -- finally was pushed into saying, yes, that's part of NATO.

So, yes, it's an overall concern, but you know, it's of a piece --


KING: -- with his whole strategy of "America first." And the problem is, we're in an interdependent world, and we need allies.

BERMAN: Right.

KING: And we particularly need allies against a rising China and a resurgent, aggressive Russia.

BERMAN: Let me ask you -- KING: Now is not the time to be undermining these arrangements.

BERMAN: Let me ask you something you know a lot about. You sit on the Senate Intelligence Committee. This is a quote from the initial report from the intelligence community on Russian meddling. And it says, "In trying to influence the U.S. election, we assess the Kremlin sought to advance its longstanding desire to undermine the U.S.-led liberal democratic order, the promotion of which Putin and other senior Russian leaders view as a threat to Russia and Putin's regime."

"The U.S.-led liberal democratic order."

KING: Yes.

BERMAN: Do you believe that is being shaken? Do you believe that Vladimir Putin is getting what he wants when he watches this acrimony taking place before our eyes in Brussels?

KING: The short answer to that question is yes. Putin's dream has been weakening, undermining European unity and the western alliance. That's -- that's what he's trying to do.

And he's a -- he can smell weakness. And if he sees the weakness, the disunity between the U.S. and Europe, you know, who knows what happens in the Baltics, for example? Are we inviting aggression? That's the danger here.

So yes, there's no question. This -- you know, you can go back and read Putin's speeches. He -- he views the western alliance as a threat, and he wants to see it undermined. That's their strategy. That's why they're involved in European politics. They got involved in our politics. This is what they want to do, and I'm afraid that we're playing into Putin's hands.

BERMAN: You have a Supreme Court nomination before you. You vote September or early October. Have you had a chance to assess Brett Kavanaugh?

KING: Well, I'm starting. I got -- this book was sent home with me last night. This is the very beginning.

Brett Kavanaugh has a voluminous record, and it's going to take some time to really dig into it. Three hundred opinions on the circuit court. He worked in the White House. We need to see his e-mails and the statements that he made during that time. We did the same with Elena Kagan several years ago. So there's a lot to go into here.

I' m concerned for a couple of reasons, though. And I haven't made up my mind. I'm going to dig into it. I'm going to meet him. I'm going to go to his hearing, even though I'm not on the committee. I'm going to learn everything I can. But the very fact that he came off of a list that was given to the president by an outside group, that starts me in a negative direction.

And he's had some opinions that have suggested, not outright, but have suggested reluctance or skepticism of Roe v. Wade, of the Affordable Care Act. And the one that -- that jumped out at me, he said that regulating net neutrality was probably unconstitutional. He's talking about the free speech rights of Comcast as opposed to millions of Americans that want a free and open Internet. So that one -- you know, that was one.

But there's a lot to look at here. He's a smart guy, for sure, has good credentials. So I'm -- I guess I would say I'm open-minded, looking at the facts, but looking at them somewhat skeptically.

BERMAN: Very quickly, we have about 20 seconds left. The president announced new tariffs on China, or looking into new tariffs on China. It would take place two months from now.

They're having some issues with lobster in Maine already from this trade war.

KING: Already. The Chinese have already said that they're going to put 35, 40 percent tariff on live lobsters. That's 20 percent of our -- of our market for lobsters. It will almost undoubtedly lower prices. That's going to go right back to the fisherman.

I was in the center -- epicenter of the lobster coast at Stonington, Maine, last week. And people are really worried. And this is one of those things where you do X and Y is going to happen, and it was predictable. And I think this is going to be really costly around the country. Lobsters is a good example in Maine. But it's happening to soybeans in the Midwest.

You know, I don't -- if I thought there was a strategy, I'd feel better about it. But again, it's sort of like the -- what's going on in NATO. It's just shaking things up and without an end game.

BERMAN: Senator Angus King of Maine, thanks so much for being with us. I do appreciate it, sir.


CAMEROTA: All right, John, we're going to talk more about what's going on at NATO as we speak. The former NATO supreme allied commander is going to talk with us about the tone that President --