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EARLY START

James Mattis Resigns in Protest; U.S. Military Ordered to Pull Troops from Afghanistan. Aired 4:30-5a ET

Aired December 21, 2018 - 04:30   ET

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


(BEGIN VIDEO CLIP)

[04:30:56] WILLIAM COHEN, FORMER DEFENSE SECRETARY: The president has taken a wrecking ball to every pillar of stability and security we've erected over the past 60, 70 years.

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ALISON KOSIK, CNN ANCHOR: Frustration boiling over after Jim Mattis resigns as Defense secretary. The breaking point? The president's decision to pull troops from Syria.

DAVE BRIGGS, CNN ANCHOR: The government on track to shut down at midnight. The president vowing to follow through on his demand for a border wall.

KOSIK: The acting attorney general defying ethics officials and will not recuse himself from the Mueller probe.

(BEGIN VIDEO CLIP)

ANDY COHEN, HOST, BRAVO'S "WATCH WHAT HAPPENS LIVE": This has been an incredible joyous journey with you all.

(END VIDEO CLIP)

BRIGGS: And a surprise announcement from Andy Cohen but it's not what you think. Andy Cohen will help us count down to 2019 here on CNN but meanwhile we are counting down to a government shutdown.

KOSIK: Yes, we are.

BRIGGS: Welcome back to EARLY START. I'm Dave Briggs.

KOSIK: Good morning, I'm Alison Kosik. It's 30 minutes past the hour. And President Trump scouring for a new secretary of Defense.

James Mattis considered by many the guardrail of this administration will leave at the end of February. He tendered his resignation just a day after the president revealed plans to withdraw U.S. troops from Syria. His departure shaking Washington, and creating uncertainty at the Pentagon and at military bases around the world.

BRIGGS: Mattis' resignation in essence a rebuke to many of the president's foreign policy views. Mattis using his letter to promote the importance of U.S. alliances and an unambiguous approach to adversaries like China and Russia. But no doubt, the last straw for Mattis was President Trump's planned withdrawal from Syria. Two Defense officials tell CNN Mattis was, quote, "livid."

For more here's Barbara Starr at the Pentagon.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Alison and Dave, an administration official tells CNN that Secretary Mattis decided early Thursday morning around 7:30 that he needed to go to the White House one more time, meet with President Trump and try to convince him not to withdraw U.S. troops from Syria.

Mattis was very concerned about the fate of the Kurdish fighters that the U.S. has backed. As a military man, it would be a terrible thing in his view to leave your friends on the battlefield that you had promised to stay and support. That became a big problem for Jim Mattis to leave the Kurds behind and withdraw U.S. troops.

He met with President Trump about 3:00. Expressed his views. The president did not change his mind. And Mattis had a resignation letter ready to go telling the president in that letter that he deserved someone who was more aligned with his views. That essentially means James Mattis quit under protest.

He talked in that letter about the need to support alliances, about the need to support U.S. interests around the world at a time when President Trump is taking a much more isolationist view and believes that the U.S. does not have a frontline role anymore in fighting terror groups like ISIS -- Alison, Dave.

KOSIK: All right. Barbara Starr, thanks very much.

Secretary Mattis' decision to quit literally stunning Capitol Hill. One conservative House Republican who supports President Trump, wondering whether the wheels may be coming off.

After reading the astonishing resignation letter we all recommend you read it, Senator Marco Rubio of Florida tweeted, "It is abundantly clear we are headed toward a series of grave policy errors." He calls on fellow Republicans who support Mr. Trump to help persuade him to choose a different direction.

BRIGGS: Democrats are also shaken. Senator Mark Warner of Virginia tweeting this. "This is scary. National defense is too important to be subjected to the president's erratic whims."

Also weighing in William Cohen, a Republican who served as Defense secretary for Bill Clinton. Listen.

(BEGIN VIDEO CLIP)

COHEN: Our credibility and our reputation for reliability has now been called into question. And the president can say I made a campaign promise. You can make a campaign promise, but some of them are made to be broken. [04:35:05] The president has taken a wrecking ball to every pillar of

stability and security we have erected over the past 60, 70 years. He's systematically demolishing them.

(END VIDEO CLIP)

BRIGGS: General Stanley McChrystal, the former commander of U.S. forces in Afghanistan tells CNN, "The kind of leadership that causes a dedicated patriot like Jim Mattis to leave should give pause to every American."

KOSIK: News of Secretary Mattis' resignation came moments after we learned the U.S. military had been ordered to begin planning the withdrawal of about half of U.S. forces in Afghanistan. It could take months to pull out of the nearly 7,000 troops out.

The decision prompted a dire warning for the second straight day from one of the president's top Senate allies. Senator Lindsey Graham calls American troop withdrawals a high risk strategy. He says, "If we continue on our present course, we are setting in motion the loss of all our gains and paving the way toward a second 9/11."

Senior international correspondent Ivan Watson is live for us with the latest.

What is the reaction from the Afghan government.

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Good morning, Alison. Let's start with the fact that this is America's longest running foreign conflict. 17 years. And it is not doing well. According to the Afghan president, 29,000 Afghan police and soldiers have been killed since 2015 in the war. And here are some statistics from the U.S. special investigative general for Afghanistan.

The Afghan government only controls about 55 percent of districts around the country and only about 65 percent of the population. Going further, there are the Afghan military which is about 11 percent below their target strength right now due to desertion, due to these casualties, and some 12 percent of Afghan districts are in the hands of Afghan insurgents. The Taliban and also ISIS on the ground in Afghanistan.

Now top U.S. military commanders have called this a stalemate. That said the chairman of the Joint Chiefs of Staff just last December 6th was saying that he was recommending against a drawdown. President Trump's choice to become the next commander of Central Command also said that a precipitous U.S. military withdrawal would leave the Afghan government incapable of defending itself.

The Afghan government is coming out with statements trying to drum up national pride in the event of a U.S. drawdown with the chief advisory to the Afghan president tweeting this, quote, "If a few thousand foreign troops that advise, train and assist leave, it will not affect our security. In the past four and a half years, our security is completely in the hands of Afghans and the final goal is that the Afghan Security Forces will stand on their feet to protect and defend soil on their own."

This is a messy conflict. There's not an easy way out. But some real questions about a withdrawal, particularly when NATO is leading the foreign military presence there. Some 41 countries contributing. If the U.S. pulls out it will affect NATO as well -- Alison, Dave.

KOSIK: All right, Ivan Watson, thanks so much for your reporting.

BRIGGS: A cold, harsh reality on the first day of winter. A partial government shutdown is looking likely over Christmas. It looked like Democrats and Republicans were coming together on a short-term plan to fund the federal government through early February, that is until President Trump derailed the deal. He says, if there aren't billions for his border wall, he's not on board.

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DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I've made my position very clear. Any measure that funds the government must include border security. Has to. Not for political purposes, but for our country. For the safety.

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KOSIK: OK. So where are we now? The House scrambled Thursday to pass a spending bill that includes an additional $5 billion for a border wall. The president he had just to rub it in, he tweeted this, "Soon to be speaker Nancy Pelosi said last week Republicans didn't have the votes for border security. But she does not have to apologize."

BRIGGS: But here's the problem. The House bill is dead on arrival in the Senate. Three reasons. Opposition to the border wall money, frustration over how the president is handling negotiations and AWOL lawmakers, roughly 40 members from both parties have missed recent votes. They're heading out of town for Christmas.

Senate majority leader Mitch McConnell is still hoping to head off a shutdown. He is expected to schedule a vote today to debate the House bill.

KOSIK: If the Senate votes it down as expected, the two chambers they can try to negotiate a compromise or the House could approve the Senate bill that does not include border wall funding.

[04:40:06] If that all fails, well, a shutdown. President Trump is scheduled to travel to his Mar-a-Lago today for a two-week break. The White House says he will not travel if there is a shutdown.

BRIGGS: If there is that partial shutdown, the Department of Homeland Security, the Justice Department and the State Department would be among the agencies affected. More than 420,000 federal employees deemed essential would continue to work, but their pay would be withheld until the shutdown is over. Another 380,000 would be placed on leave without pay. That includes most of the staff at NASA and the National Park Service right before the holidays, mind you.

And there are real concerns about what a shutdown might do to the already rattled financial markets.

KOSIK: Well, they are not liking it. Because the last thing Wall Street needs right now is a partial government shutdown. Fear has really gripped the markets this week. The Dow dropped 464 points or 2 percent on Thursday. The average closing below 23,000 for the first time since October 2017.

The Nasdaq losing 1.6 percent. Just avoiding closing in its first bear market since the great recession. The S&P 500 tumbling 1.6 percent. That's down 16 percent from its high. So investors clearly still rattled by the Federal Reserve's decision to raise interest rates for the fourth time this year, despite evidence of slowing economic growth.

Worries about a supply glut. That knocked oil into a bear market. Crude plunging 4.8 percent on Thursday to $45.88 a barrel. This is the first time since August of 2017 that oil has ended below $46 a barrel.

Investors seemed to be moving away from risky stocks. We're watching shares of Tesla fall 5 percent. JC Penney falling 6 percent. Twitter plunging 11 percent.

We're not seeing these investors buy the dips.

BRIGGS: Yes, usually you see for the past two years the markets kind of put on the earmuffs or the blinders to all the Washington chaos. That's no longer happening.

KOSIK: Oh no, it's sort of turning into a big ball that's sitting right here in their stomachs.

(LAUGHTER)

BRIGGS: Making us feel nauseous.

Any other administration, this is a major story. A big bipartisan accomplishment. A major accomplishment, folks. Passes major criminal justice reform. But this was no ordinary day in Washington.

(COMMERCIAL BREAK)

[4:46:37] KOSIK: Welcome back. Acting Attorney General Matt Whitaker rejecting advice from Justice Department ethics officials to recuse himself from the Mueller's investigation. Before his appointment by President Trump, Whitaker publicly criticized the probe suggesting on CNN last year it could be curtailed by, quote, "choking off funding." The ethic officials concluded there was no actual legal conflict but based on Whitaker's past public comments it was a close call and he should recuse himself.

BRIGGS: But a tight group of Whitaker's own advisers who were engaged in the ethics review did their own assessment and recommend he not recuse himself. The refusal to heed advice from ethic officials will raise questions from Democrats on Capitol Hill. Assistant Attorney General Stephen Boyd defending Whitaker's decision. He notes the acting AG has not made public comments about the investigation for 16 months and has, quote, "a lot of respect for Mueller."

KOSIK: And what's being hailed as a bipartisan victory the House passed criminal justice reform legislation. It is a big win for President Trump who was expected to sign the measure today. The so- called First Step Act will allow thousands of federal inmates' early released. It also eases some mandatory minimum sentences and gives judges more leeway in sentencing.

BRIGGS: Democrats planning a dozen presidential debates in the 2020 primary race, their first debates slotted for June 2019, mark it down. DNC chairman Tom Perez says six debates will be held next year. None will be in the four early primary and caucus states, Iowa, South Carolina or Nevada. Debates in those states will only take place in the run-up in each contest in early 2020.

KOSIK: Revealing the schedule is meant to get ahead of what's expected to be a barrage of presidential announcements in the coming weeks. Perez wants debate guidelines public before the field event is fully formed in an effort to avoid the calls of bias that plagued 2016.

Now if we can just get through what we're getting through right now -- the shutdown.

BRIGGS: Yes, yes.

KOSIK: The Mattis shock.

BRIGGS: I think they also want to avoid that kiddy table approach the GOP took where Lindsey Graham and others were at that secondary B team like debate.

KOSIK: Yes.

All right. Could Budweiser drinkers soon be swapping beer for pot- infused drinks? CNN Business is next.

(COMMERCIAL BREAK)

[04:53:34] BRIGGS: The United States considering measures outside of sanctions to build trust with North Korea. U.S. special envoy to North Korea Stephen Biegun telling reporters in Seoul, U.S. diplomats would like to explore a number of initiatives as they start moves toward denuclearization. He did give any further details on what those measures could be but did mention possible changes to the rules for delivering humanitarian assistance to North Korea. Pyongyang reiterating its line it will not give up its nuclear weapons until the U.S. removes its own, quote, nuclear threat.

KOSIK: One of Britain's biggest airports has reopened this morning albeit with delays. Repeated drone sightings shutdown Gatwick International Airport during one of the busiest travel periods of the year. The airport was closed from 9:00 p.m. on Wednesday until about 6:00 this morning local time.

More than 110,000 passengers were stranded. Look at them. Many planes diverted to Manchester, Heathrow, even as far away as Paris or Amsterdam. The Defense Ministry deploying special equipment to help police track down the drone's operator. So far no leads.

Police in Los Angeles say they harvested nearly $20 million in narcotics, cash and weapons in what they called a major drug bust. The LAPD seized jars of cannabis oil, some marijuana, along with $150,000 in cash, pre-made money orders and assault rifle and three handguns. Detectives say the operation appeared to be a processing facility.

[04:55:01] Police say 24-year-old Daniel Ontivaros (PH) and three other men were arrested. Even though marijuana is legal in California everything sold has to be regulated and approved.

KOSIK: An Iowa man accused of sexually abusing a 13-year-old went free after the prosecutor showed up to court drunk. Clark County attorney Michelle Rivera was arrested for being in court intoxicated. A deputy says he noticed she was slurring her words and stumbling on her feet and he could smell alcohol. He says when he asked her to step out of the courtroom to take a breathalyzer she refused and was arrested. CNN reached out to Rivera and an attorney. No response yet.

This happens in October but came to light when Rivera was arrested again last week on suspicion of drunk driving. She lost he reelection bid in November.

BRIGGS: Fellow investigators accusing a New York district attorney of hindering an investigation into October's horrific limo crash that killed 20 people including four sisters and a newlywed couple. The National Transportation Safety Board releasing a scathing sent to the Schoharie A.D. it says in part the delays you imposed have denied the NTSB access to the primary essential evidence resulting in safety critical evidence being lost.

KOSIK: An NTSB spokesman says the board and the D.A.'s office have spoken by phone since, but issues have not been resolved. CNN has reached out to the D.A. No response from her office yet.

The crash was the deadliest transportation accident in the U.S. in a decade. It was later revealed the limo failed inspection and the driver was not properly licensed.

BRIGGS: We already know Andy Cohen, Anderson Cooper's co-host for CNN New Year's eve coverage is going to have a very memorable 2019. He just revealed he is about to be a father via surrogate. He closed out his final 2018 live broadcast to the show "What Happens Live" by saying if all goes well, he'll soon be a dad.

(BEGIN VIDEO CLIP)

ANDY COHEN, HOST, "WHAT HAPPENS LIVE": You have supported me through almost 10 years of live Tom Foolery night after night. This has been an incredible joyous journey with you all. I am grateful to be able to live my dream every day and grateful to you for coming along for the ride. Tonight I want you to be first to know that that after many years of careful deliberation, a fair amount of prayers and the benefit of science, if all goes according to plan, in about six weeks time, I'm going to become a father.

(END VIDEO CLIP)

BRIGGS: Congratulations. Cohen says family means everything to me. Having one of my own is something I have wanted in my heart for my entire life.

KOSIK: He will definitely be busy in 2019.

All right. Let's get a check on CNN Business this morning. Markets around the world are lower. Looks like the Dow is headed for a triple digit loss at the open. In Asia the Nikkei fell 1 percent. The Shanghai is down close 1 percent. The Hang Seng is up a fraction. European markets are lower at the start of trading there.

Once again, Wall Street we are seeing futures in the red. Markets were hurt by signs of a potential government shutdown Thursday. The Dow dropped 464 points or 2 percent on Thursday. The Nasdaq lost 1.6 percent just avoiding closing in its first bear market since the great recession. That's a 20 percent drop from the high. The S&P declined 1.6 percent.

Investors they continue to be rattled by Federal Reserve policy despite evidence of slowing economic growth.

Nissan's former chief will be spending Christmas in jail. Carlos Ghosn was rearrested Friday morning over additional allegations of breach of trust. Prosecutors alleged Ghosn shifted $16.6 million of losses from its private investment to Nissan as the global financial crisis erupted in October 2008. Since his arrest last month in Tokyo Ghosn has been fired by -- as chairman by both Nissan and Mitsubishi Motors. Renault has appointed some folks in the interim management space but they're keeping him on the payroll. Ghosn has yet to issue a public statement in response to the growing number of allegations that are piling up against him.

Could Budweiser drinkers soon be swapping beer for pot? The world's biggest brewer teaming up with Canada's Tilray to research pot-infused drinks. Budweiser and Tilray will invest a combined $100 million into researching non-alcoholic drinks containing cannabis elements. Budweiser is the latest company to start exploring the pot market following the legalization of recreational marijuana in Canada and a number of states in the U.S.

Another Canadian marijuana company Canopy Growth it received a multimillion dollar investment from Corona owner Constellation Brands in August. One top brand resisting the pot rush for now? Coca-Cola. CEO James Quincy said in October that it doesn't have any plans at this stage -- hmm -- to enter the cannabis market.

That's a little vague. BRIGGS: Yes. At this stage.

KOSIK: Because the reality is a lot of consumer brands are trying to figure out how to really capitalize on the cannabis market.

BRIGGS: Yes. It's gold rush, my friend.

(LAUGHTER)