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EARLY START

Holy Fire Prompts State of Emergency in Southern California; Prosecutors Expected to Rest in Manafort Trial; U.S.-North Korea Reach Impasse on Denuclearization; Mike Pence Lays Out Plans for Trump's Space Force. Aired 4-4:30a ET

Aired August 10, 2018 - 04:00   ET

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


(BEGIN VIDEO CLIP)

[04:00:12] UNIDENTIFIED MALE: Anybody else found?

UNIDENTIFIED MALE: No, nobody's here. We need fire trucks.

UNIDENTIFIED MALE: Yes.

(END VIDEO CLIP)

PHIL MATTINGLY, CNN ANCHOR: Forced evacuations overnight as homeowners wage a desperate battle against a raging wildfire.

CHRISTINE ROMANS, CNN ANCHOR: NFL players seen kneeling during the national anthem last night. How will President Trump respond?

MATTINGLY: And the so-called Manhattan Madame testifies in front of Robert Mueller's grand jury in just a matter of hours.

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MIKE PENCE, VICE PRESIDENT OF THE UNITED STATES: The time has come to establish the United States Space Force.

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ROMANS: The Trump administration shoots for the stars. But what would this brand new branch of the military do?

Good morning, and welcome to EARLY START. It's Friday morning. I'm Christine Romans.

MATTINGLY: We made it.

ROMANS: Yes, we made it.

MATTINGLY: And I'm Phil Mattingly in for Dave Briggs. It's Friday, August 10th. It's 4:00 a.m. in the East, and this is day five of you putting up with me.

ROMANS: Thanks for being here.

MATTINGLY: Which my wife would be the first to tell you is not an easy thing to do.

ROMANS: She raised you well.

MATTINGLY: Thank you. Continues to.

ROMANS: She raised you well.

MATTINGLY: All right. To the news. Breaking overnight. California's governor declaring a state of emergency as the raging Holy Fire inches closer to homes in the southern part of the state.

Here is what we know at this hour. The inferno it is only 5 percent contained. More than 21,000 people are under mandatory evacuation and so far more than 10,000 acres have burned.

Now take a look at these images emerging overnight, massive flames from the Holy Fire bearing down on this neighborhood in Lake Elsinore. Firefighters urging a man to leave as he was spotted using a garden hose to put out embers on his roof. Earlier in the evening a man captured flames burning right in his backyard. He eventually and told CNN he is not actually sure he'll have a home when we returns.

CNN's Stephanie Elam brings us the very latest from fire-ravaged Lake Elsinore, California.

STEPHANIE ELAM, CNN CORRESPONDENT: Christine and Phil, this is the concern. We are here at the Holy Fire and take a look at how this hillside is going up right now. And if you look downhill, if you slowly find your way downhill you will see that firefighters are taking a stand here. These blazes going up right behind these homes. It is casting so much dark smoke in the sky you can't even tell how bright it is here right now.

They are fighting this and one of the huge problems that they have right now are the winds, and these winds are not expected to let up anytime soon. So with that in mind, firefighters are saying that they are nowhere near containing this fire here -- Phil and Christine.

ROMANS: All right, Stephanie Elam for us, thank you.

The national anthem controversy, kneeling controversy is alive and well in the NFL.

A full schedule of pre-season week one games last night. And take a look at Miami Dolphins wide receiver Kenny Stills and Albert Wilson taking a knee during the anthem before taking on the Tampa Bay Bucs. In Cleveland, 10 members of the New York Giants kneeled in unison in the end zone before the national anthem was played. Ten. Four members of the Jacksonville Jaguars, three players with the Seattle Seahawks also made statements by waiting in the tunnel during the anthem before taking the field last night.

The NFL says no punishment will be handed out while it continues to work with the players' union on a mutually agreeable policy.

MATTINGLY: This isn't going anywhere any time soon. ROMANS: No.

MATTINGLY: Watch the president's Twitter account I assume this morning.

All right. Later today, the Manhattan Madame, Kristen Davis, appears before a federal grand jury in Washington. That grand jury is hearing evidence in Special Counsel Robert Mueller's Russia probe.

Now it is not currently clear what prosecutors actually want to ask Davis. She interviewed voluntarily last week with members of Mueller's team. One possible line of inquiry is from longstanding connection to Roger Stone, the veteran political consultant and Trump adviser who's become a central subject in the Russia investigation.

ROMANS: All right. The prosecution is expected to rest its case today in the fraud trial of former Trump campaign chairman Paul Manafort. Over the last eight days, the court has heard testimony about Manafort's extravagant wardrobe, secret offshore bank accounts, fake loan applications, and doctored bank accounts. His longtime deputy Rick Gates flipping to become the star prosecution witness.

And as the defense prepares to offer up its case, a court filing from Special Counsel Robert Mueller is sending a clear signal that Gates is also assisting with the Russia probe.

We get more this morning from CNN's Kara Scannell.

KARA SCANNELL, CNN CORRESPONDENT: A new detail in the special counsel's investigation was revealed not in court but in a filing. Prosecutors asked the judge to seal a portion of a sidebar that took place when Rick Gates was on the stand.

Paul Manafort's attorney had just asked Gates about any interviews he had with the special counsel's office concerning his time on the Trump campaign. Gates worked as Paul Manafort's deputy on that campaign and continued on working with the inauguration. Now the judge agreed to seal it after prosecutors said that it revealed substantive evidence of an ongoing investigation.

[04:05:02] Now inside court the jury heard a lot of details about bank fraud allegations, specifically focused on one $3.4 million loan Paul Manafort had taken out from a bank. He had told the bank that it was a second home and prosecutors say that that was a lie and provided the bank's false information when it was actually rental property.

They showed Airbnb records indicating that Manafort had rented out the property and they also had one of the mortgage bankers testify. She said had she known it was a rental that Manafort would not have gotten as much money. Instead, he exceeded the bank policy by $2.4 million.

Now prosecutors have four more witnesses they plan to call. Two of those have immunity deals. And then prosecutors say they intend to wrap their case today -- Christine, Phil.

ROMANS: All right. Thanks, Kara. A federal judge threatened to hold Attorney General Jeff Sessions and

other top administration officials in contempt if they did not immediately return two deported asylum seekers to U.S. soil. District Judge Emmett Sullivan erupted in court when told the woman and her daughter were on a plane to El Salvador. Government lawyers had promised no one in the immigration case he was hearing would be deported until midnight Thursday at the earliest. Sullivan fumed, quote, "I'm not asking, I'm ordering." By nightfall, the deportees identified only as Carmen and her daughter had been returned to Texas.

MATTINGLY: And an investigation under way right now in Texas after allegations surfaced that a child died after being released from an ICE facility. The spokesman for the Texas Department of Family and Protective Services tells CNN they now have the child's name and have opened a probe into abuse and neglect. The DFPS official testified to state lawmakers Thursday they couldn't investigate the alleged death which surfaced earlier this month. And the official said despite repeated attempts, officials could not get the child's name or other key information. ICE tells CNN they do not have any information on the matter at this time.

ROMANS: OK. A lot of questions, troubling questions about that story.

President Trump's in-laws are now officially citizens of the United States. Viktor and Amalija Knavs took the oath Thursday. They gained their citizenship through a category of family visas that their son- in-law, the president, had sought to repeal. Like their daughter Melania, Mr. and Mrs. Knavs immigrated from Slovenia. A source with direct knowledge says they have been living in the U.S. with green cards sponsored by Melania, their daughter.

The president has denounced family-based immigration just like this particular case, calling for an end to what we refers to as chain migration. That's where a family member comes first and then can sponsor their family. He would prefer merit-based, not family-based immigration. The first lady's office declined to comment. And we would like to congratulate the Knavs on becoming American citizens. It is one -- it's the most precious gift this country can give.

MATTINGLY: Absolutely. All right. Kansas Secretary of State Kris Kobach says he will recuse himself from overseeing the still undecided gubernatorial primary race between himself and incumbent Governor Jeff Colyer. Kobach leads by a razor thin now 91 votes, just 91 votes, after discrepancies were found in vote totals from at least two counties. He is expected to recuse himself officially today after Colyer made the demanded in a letter last night.

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KRIS KOBACH (R), KANSAS GUBERNATORIAL CANDIDATE: The counties did the counting of ballots so it's -- there's really no point to it but I said if my opponent wishes me to I'd be happy to. But it's fairly symbolic. I don't think he understands the process.

(END VIDEO CLIP) MATTINGLY: Person overseeing the vote that he is involved in. Interesting. All right. Thousands of provisional and mail-in ballots still have to be counted in that race. Election officials are blaming a, quote, "clerical error" in one county where Governor Colyer was shortchanged 100 votes.

ROMANS: All right. Sinclair's acquisition of Tribune Media is dead, cancelling a $3.9 billion deal that would have created a local TV power house. This is a big defeat for Sinclair. The largest owner of local TV stations in the U.S. It's often been criticized for its must-run segments of conservative commentary and for forcing local anchors to read a promo echoing President Trump's anti-media rhetoric.

Tribune terminated its agreement with Sinclair after FCC chair Ajit Pai expressed serious concerns putting the deal in doubt. The problem the merger would have given Sinclair access to 72 percent of U.S. households. That is well above the FCC's limit. Tribune says it pulled out of the deal after Sinclair did not sell off stations as requested and was unnecessarily aggressive with the Justice Department and FCC. Tribune is now suing for breach of contract. Sinclair says it is disappointed the deal failed but intends to fight the lawsuits.

MATTINGLY: And that's going to be in the courts for a while.

ROMANS: I think it will be.

MATTINGLY: And maybe on the president's Twitter account, too.

All right. The U.S. and North Korea in a standoff over nuclear weapons again. And still. A live report just ahead.

ROMANS: And a teenager recovering after being pushed off a bridge by her friend.

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ROMANS: The U.S. and North Korea in a verbal standoff this morning. Pyongyang insisting some high-level officials in the administration are thwarting President Trump's will by amping up international pressure on the Kim regime to denuclearize. On the other side, diplomatic sources tell CNN the U.S. has made specific proposals for a fully verified nuclear denuclearization. All of them have been rejected by the Kim regime as, quote, "gangster like."

For the latest on this impasse, let's bring in CNN's Will Ripley live in Hong Kong -- Will.

WILL RIPLEY, CNN INTERNATIONAL CORRESPONDENT: Hi, Christine. Yes, this is just increasingly frustrating really for both sides. It sounds like in that early July meeting in Pyongyang with Secretary of State Mike Pompeo and North Korea's designated nuclear negotiator Kim Yong Chol, I mean, they were just butting heads. The U.S. was asking for something, the North Korea said, then the U.S. asks again. The North Koreans said no. And it just got worse and worse to the point that now they're not sure they even want to negotiate at a lower level.

[04:15:02] This is why North Korean sources were saying to CNN earlier this week that they want a second summit with President Trump. And you know, even in the statement that was released, you know, the wording is very flattering towards President Trump. They even take a page from President Trump's own playbook, questioning U.S. intelligence saying that it's a fabrication of the U.S. intelligence that North Korea is building new intercontinental ballistic missiles and continuing to enrich nuclear fuel.

They said that that's being drummed up by elements inside the United States government to try to derail the denuclearization process. And yet they continue to say that President Trump is the one with the vision of a better relationship with North Korea.

So I mean, I think all of this -- this is really setting the stage, Christine, for what the North Koreans are going to hope will be a second summit at some point in the coming weeks or months.

ROMANS: All right. Will Ripley for us in Hong Kong. Thanks, Will.

MATTINGLY: All right. Vice President Mike Pence is calling for the establishment of a Space Force by the year 2020. In a speech at the Pentagon Pence echoed the president's sentiment that a military conflict in space is a very real threat.

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PENCE: Previous administrations all but neglected the growing security threats emerging in space. President Trump stated clearly and forcefully that space is, in his words, a war-fighting domain just like land and air and sea.

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MATTINGLY: Now CNN's Barbara Starr has the latest from the Pentagon.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Christine, Phil, Vice President Mike Pence coming to the Pentagon to unveil President Trump's plan to radically change one element of war fighting. The president long wanting to see a United States space force. A new branch of the U.S. military to focus entirely on war fighting in space. Outside the earth's atmosphere.

What he's talking about is taking all the elements of U.S. military service capabilities and putting them under a whole new branch of the military. Whether that is needed or not is still a subject of debate and Congress would have to approve it. But people do not dispute there is a space threat. The Russians, the Chinese, the Iranians, the North Koreans all working on improving their own capabilities in space. The Chinese, in fact, in 2007, demonstrated a missile that could shoot down a satellite in space. They shot down one of their old out-of-date satellites. And that was a game changer.

That means if you can shoot down satellites in space and if you could shoot down an American satellite, it would affect life considerably. GPS communications, the Internet, weather forecasting, which could affect commercial aviation. It would fundamentally change American life forever if American satellites were put at risk from an adversary. So the president believes that having a new United States Space Force is the way to go. Congress still would have to approve the final elements of that plan -- Christine, Phil.

ROMANS: All right. Barbara Starr at the Pentagon. Thank you, Barbara.

Even though Congress would have to approve any new military branch, the Trump re-election campaign has already launched its efforts. It's calling on supporters to help select the space force's official logo. Visitors to the Web site will get to choose from these six designs. The logos will then be displayed on merchandise to be sold through the president's re-election site. Branding exercise.

MATTINGLY: You literally get to pick, there's a poll, and you get to pick your favorite design of space force. It's -- I don't know. It's like the biggest applause line the president has --

ROMANS: Is it really?

MATTINGLY: Yes. People go crazy with the space force message. I think it sounds cool.

All right. Guess who is thinking about running against Donald Trump for president?

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MICHAEL AVENATTI, STORY DANIEL'S ATTORNEY: I'm serious about considering it.

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MATTINGLY: Exactly what we need. All right. More from Stormy Daniels' lawyer Michael Avenatti coming up.

ROMANS: Plus with friends like these, who needs enemies?

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[04:23:21] MATTINGLY: And assistant coach for Wake Forest men's basketball team has been charged with assault after New York City police say he punched a man who later died. Police released this surveillance video of Jamill Jones walking away from the scene Sunday.

Our affiliate WPIX reports the victim, Sandor Szabo, knocked on the window of Jones' SUV thinking it was his Uber. That's when Jones allegedly struck Szabo in the face. The victim fell back, hit his head, and lost consciousness. Jones did not enter a plea during his arraignment Thursday evening and was released on his own recognizance. He's due back in court in October.

ROMANS: A teenager in Washington State pushed off a foot bridge by a friend is recovering and now speaking out. The video of 16-year-old Jordan Holgerson being pushed has gone vial. Speaking from the hospital she described what it was like to plummet about 50 feet.

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JORDAN HOLGERSON, PUSHED OFF BRIDGE: In the air, I think I might have fainted, but when I hit the water I was definitely awake and aware. I was trying to push myself forward so I could be like straight up and down so that my feet hit first, but that didn't really work.

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ROMANS: She broke a number of ribs. She damaged a lung. It will take weeks to recover. Local media report the friend that pushed her may face charges.

MATTINGLY: Here is a good baseline. Edge of a pool? You can jokingly push somebody else. 50 feet from the water?

ROMANS: It just isn't --

MATTINGLY: Let's not do that.

ROMANS: I know. It's just a really bad idea. And you wonder if it's like this -- and somebody was filming it, right? So you wonder if this generation of, you know, viral media generation that, you know, kids thought that would be a funny doing to do. I don't know.

MATTINGLY: And bizarre. Just don't do that. It sounds like a low bar.

All right. Michael Avenatti for president in 2020?

[04:25:02] Yes. Because it's 2018. Why not? The attorney for adult film star Stormy Daniels says he is seriously considering it. He just traveled to Iowa, yes, the first-in-the-nation caucus state, to test those waters. Avenatti says his ultimate goal is to get President Trump out of office.

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AVENATTI: I'm worried about the Democratic Party nominating somebody that cannot be competitive against and beat Donald Trump in 2020. And that is the number one question that the party has to ask is can this nominee -- potential nominee beat Donald Trump?

(END VIDEO CLIP) MATTINGLY: Avenatti says he will make up his mind about a bid for the presidency in the coming weeks.

ROMANS: Iowa State fair. A good place to go to try it out, see what people think about him.

MATTINGLY: The very place to go.

ROMANS: Yes, or just have, you know, some, what is it? Like pork chops on a stick.

MATTINGLY: Yes. A lot of butter, too.

(LAUGHTER)

ROMANS: A lot of butter.

All right. Coming up, homeowners battling this raging California wildfire. The frontlines are now in their backyard.

MATTINGLY: Plus a woman who once ran a high priced prostitution ring takes center stage in the Mueller investigation today.

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