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EARLY START

New Clinton Attacks on Trump; Obama Speaks Out Against Congress; Dramatic Developments at FOX News; Amazon Stock at All Time High. Aired 4:30-5a ET

Aired September 7, 2016 - 04:30   ET

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

CHRISTINE ROMANS, CNN ANCHOR: A split focus for Hillary Clinton and Donald Trump, both ramping up the attacks on each other as they try to polish their national security credentials. The latest from both campaigns moments away.

JOHN BERMAN, CNN ANCHOR: President Obama laying into Congress for refusing to act on a landmark trade deal. We will bring you some of the president's remarks live in Laos.

[04:30:04] Welcome back to EARLY START, everyone. I'm John Berman.

ROMANS: And I'm Christine Romans.

Nice to see you today, John.

It Wednesday.

BERMAN: Just today?

ROMANS: Just today, in 30 minutes I could change my mind. It is 4:30 in the East.

New this morning with a no lead in the presidential race, national security will be in the spotlight with new proposals and new attacks. Aides to Donald Trump say Trump will call for an increase in military spending and to restore military budget cuts that were part of the sequester, remember that?

Trump will also go after Hillary Clinton's foreign policy vision which he says favors, quote, "military conventionalism." Overnight, Trump with that plan simply to order as generals to figure out a way to defeat ISIS, now plan now appears to be simply to order his general to figure out a way to beat ISIS in 30 days. It was plan in 30 days. Trump blasted Secretary Clinton over her e-mails and claim she never talks about policy.

CNN's Sara Murray is traveling with the Trump campaign. She brings us the latest.

(BEGIN VIDEOTAPE)

SARA MURRAY, CNN POLITICS REPORTER: Good morning, John and Christine. Well, Donald Trump stuck to his message of national security as he was campaigning yesterday in Virginia and in North Carolina. And in a fiery speech here in Greenville, he went after Hillary Clinton over her use of her e-mail server, saying this was disqualifying behavior for the presidential candidate. And he specifically talked about the way she destroyed communications devices, about wiping her emails. He called this shady activity, even suggesting it was criminal.

DONALD TRUMP (R), PRESIDENTIAL NOMINEE: If she applied for a low- level job at the State Department today, just a low-level job, she couldn't even get a security clearance based on what she's done. Her conduct is disqualifying. And by the way, who uses 13 different iPhones in four years? Who?

The only people who use that many phones are usually involved in very, very -- and I mean very shady activity.

MURRAY: Now, well, there was another change in Donald Trump's speech and that was him behaving more like a traditional candidate and almost laying out a plan for the first 100 days as president. In addition to saying he would appeal Obamacare and saying he would build a wall around the southern border, he also said he would convene his generals in just 30 days and come up with a plan for how to defeat ISIS.

Now, Trump is back on the trail for nontraditional stops for Republican candidates, he'll be in Philadelphia and New York.

Back to you, guys.

(END VIDEOTAPE)

BERMAN: All right, Sara.

After his national security speech today, Donald Trump comes here to New York City for a national security town hall event. It's a one- hour Commander-in-Chief forum. Donald Trump and Hillary Clinton will answer questions from veteran groups.

Now, with a new CNN national polls showing the race very, very close, Secretary Clinton is escalating her own attacks on Trump, speaking with reporters on her campaign plane for the second day in a row. After pretty much avoiding them for the better part of the year.

CNN's Joe Johns has the latest from Florida.

(BEGIN VIDEOTAPE)

JOE JOHNS, CNN SENIOR WASHINGTON CORRESPONDENT: John and Christine, Hillary Clinton making changes, taking questions on her plane for the second time in two days, using the opportunity to both defend herself and to launch some fresh attacks on Donald Trump particularly on his business practices and his business relationships, trying to turn around the narrative on honesty and trustworthiness that had been dogging her throughout her run for president.

She focused once again on the fact that Donald Trump has not released his income tax return.

HILLARY CLINTON (D), PRESIDENTIAL NOMINEE: He said that the American people don't care about his tax returns. And in fact, he's also said that it's none of our business. I just think he's dead wrong.

I'm going to continue to raise this, because I think it is a fundamental issue about him, in this campaign. That we're going to talk about in one way or another, for the next 62 days because he clearly has something to hide.

JOHNS: Here at a public event in Tampa, Florida, on Tuesday, Hillary Clinton once again zeroing in on national security and veterans issues, something that's expected to continue in the forefront as we approach the September 11th anniversary. Neither candidate is expected to be on the trail on that day -- John and Christine.

(END VIDEOTAPE)

ROMANS: All right. Joe Johns in Tampa -- thanks, Joe.

Bill Clinton is hitting the campaign trail defending the work of the Clinton Foundation. In the battleground state of North Carolina, Clinton said his charitable foundation has been transparent and blasted the Trump Foundation for making an improper donation to Florida's attorney general in 2013.

(BEGIN VIDEO CLIP)

BILL CLINTON, FORMER PRESIDENT: I got tickled the other day Mr. Trump called my foundation a criminal enterprise.

[04:35:04] That was pretty funny considering -- considering that three major evaluators of foundations gave it the highest rate they could give.

He made a political contribution to the attorney general of Florida who at the time had her office investigating Trump University and mysteriously the investigation vanished.

(END VIDEO CLIP)

ROMANS: Florida Attorney General Pam Bondi accuses Hillary Clinton of trying to bully her now. She admits asking Trump for a donation three years ago and claims her office was never investigating him.

BERMAN: After a seven-week summer recess, it is business as usual in Congress and that means new gridlock. Senate Republicans blocked two Republican bills to fund the public health response of the Zika virus outbreak. Those bills would have also blocked Planned Parenthood funding while permitting Confederate flags to fly at military veterans cemeteries. If no progress is made over the next three weeks, a government shutdown is possible at the end of the month.

ROMANS: All right. House Republicans are promising to punish dozens of Democrats to control the House floor in June to protest the lack of action on gun control. Majority Leader Kevin McCarthy says the 25- hour sit-in broke numerous rules and caused long-term damage to the reputation of the House. Democrats who staged the sit-in could be facing fines or resolutions condemning their conduct.

ROMANS: All right. Apple set to unveil a new iPhone today. Rumored new features is already angering customers. John Berman says get over it.

BERMAN: Get over it.

ROMANS: Apple insiders believe the current 3 1/2 millimeter headphone jack will disappear from the new phones. It will push users to wireless uses connected via Bluetooth or the charging port.

Other possible upgrades we could see today, a new shade of because you can never have too many shades of black. More storage, the entry level device may be bumped up to 32 gigs, waterproof or water resistant exterior.

All of these may not help solved one of Apple's biggest problems right now, slumping stock price. Two straight quarters of declining iPhone sales have investors wary of Apple. It's one of the most widely held stock in the U.S. You probably have this somewhere. Shares of Apple are down almost 1.5 percent over the past 12 months and up a little more than 2 percent this year.

BERMAN: And the new shade of black begs the question how much black can there be, right?

ROMANS: You're not even concerned about the iPhone?

BERMAN: I'm not even, because the headphones with the phone that plug in, the only people hurt are people who charge their phones while listening to headphones. And in that small subset, that's something that you do have to with.

President Obama with harsh words for Congress during a town hall. This is part of an historic overseas trip. It's pretty interesting. We'll show you what he said, next.

(COMMERCIAL BREAK)

[04:41:54] BERMAN: President Obama is in Laos this morning. He just spent over an hour taking questions at a town hall for young Southeast Asian leaders. He's taking Congress to task for failing to act on one of his key priorities. His event ended a short time ago. Now, the president flies back to the capital of that area for the Southeast Asian summit.

Let's get the latest from that country now. We turn to White House correspondent Michelle Kosinski -- Michelle.

MICHELLE KOSINSKI, CNN WHITE HOUSE CORRESPONDENT: Right, John. Yes.

He had a double of digs in there. He talked about Congress going home and not doing much right now. They don't intend to take up the Trans Pacific Partnership, the big trade deal with Asia, that the president has been trying and trying again to promote.

I mean, the White House used this, the TPP as a litmus test, not just for the trade relationship, but also for America's keeping its word and America's staying power in Asia. He also talked about people in the United States that don't necessarily agree with him. Listen.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We have to be able to promote principles that rise above any individual religion, nationality, race. And that's what we've been trying to promote. Not only successfully. Not everybody in America agrees with me on this, by the way.

(END VIDEO CLIP)

KOSINSKI: He said maybe after the elections people will come us on the issues more when they don't he the pressures of trying to be elected. He seems to also be implying that maybe some of the people who are opposed it to the TPP now aren't quite so opposed to it and the election putting the pressure on them. Of course, he didn't name any names there.

There's also a question now that he gets back from the trip in a couple days what is he going to do for 2016? We've only seen him in a handful of events so far. There's been speculation that he's really going to rev up and be on the trail all the time but it doesn't look like that's going to be the case.

In fact, for all of September, we may only see him do one event in Philadelphia, and another fund-raiser in New York. October is what we can look to him to pick up the pace of the events but it's not going to be constant. I mean, he still has a lot to do for his day job as some sources tell us. But he is going to be busy on the trail. It's just -- we're probably not going to see that now until October.

Back to you guys.

BERMAN: All right. Michelle Kosinski for us in Laos, thanks so much.

ROMANS: A new source of tension between the U.S. and Iran, and a dangerous moment in the Persian Gulf. U.S. defense officials say a Navy patrol ship was forced to take evasive maneuvers to avoid colliding with an Iranian vessel. It was one of seven fast-attack craft involved in the encounter. It came within 100 yards of the USS Firebolt on Sunday. Officials say the Iranian action was unsafe and unprofessional. This is the latest in a string of recent incidents involving small craft of the Revolutionary Guard Navy harassing American ships.

[04:45:02] All right. One big name stock just hit an all-time high.

BERMAN: Like me.

ROMANS: And the returns for investors were incredible. Also like you. We'll show you what $10,000 worth of this stock five years ago looks like today when we get an early start on your money.

(COMMERCIAL BREAK)

BERMAN: All right. Dramatic development at FOX News and some new developments this morning. The network settle Gretchen Carlson's sexual harassment lawsuit for $20 million. And now, there's word of settlement deals with other women who made accusations the ousted FOX News chief Roger Ailes, deals that have not been announced yet.

ROMANS: And this one the same day, longtime host Greta Van Susteren abruptly quit the network.

So, how does the latest FOX shake up affect the landscape of cable news?

For that, we turn to Brian Stelter, senior media correspondent and host of CNN's "RELIABLE SOURCES."

[04:50:01] Pretty dramatic, and a lot of people making hay this morning with the fact that Roger Ailes with a $42 million and Gretchen Carlson got a $20 million settlement.

BRIAN STELTER, CNN SENIOR MEDIA CORRESPONDENT: When Roger Ailes resigned in July, he was paid at least $40 million. That was the remainder of his contract, that he was owed. But, you know, Fox could have chose to fire him, to push him out --

(CROSSTALK)

STELTER: That's right. Instead, they decided to pay the remainder of his contract.

Carlson in the other hand taking away about $20 million. Ailes not paying any part of that settlement, that's all being paid by FOX. He's also receiving a very unusual public apology.

In some ways, he's one of the highest profile figures now who's ever been accused a powerful executive, a male boss of sexual harassment and actually succeeded, or actually had what you would call a victory. But you're right, it's strange to see this disconnect in terms of amount of money being paid.

BERMAN: The public apology, it was very carefully worded. It was heavily lawyered, like the lack of respect that she endured while here. Not the fact that she was sexually harassed while here --

STELTER: Not blaming anybody, right.

BERMAN: Not blaming anybody.

Now, Brian, you're also doing this reporting on the news that there maybe more settlements. What's going on here?

STELTER: Yes, that there were other handful of deals struck but not public enough. We don't know who they involve. We know that for smaller sums of money, but it's an example of how widespread this scandal has been.

You know, we're talking about one of the biggest media scandals of the past decade and maybe perhaps an important moment for women across the country who have been sexually harassed in workplaces because is this a very high profile story, a story woman all across the country are hearing about, thinking, OK, maybe it's not always he said/she said. Maybe the power is tilted in favor of the man in these situations.

ROMANS: It would be interesting to see, but in corks and bottle in television news or in newsrooms, or workplaces.

STELTER: Yes, we've seen comparisons even to Anita Hill in terms of the public nature of this, the publicness of this story. Our colleague Kelly Wallace has a story up on CNN.com about some of the possibilities here. In some ways, yes, this could empower women to come forward about harassment.

On the other hand, Gretchen Carlson's unique case. She was a million dollar anchor.

ROMANS: Right.

STELTER: She was fired after many years --

BERMAN: She recorded conversations it empowers women. If it takes a recorded conversation to make the case, that's a pretty high bar.

STELTER: Seems like she was building a case for years in order to have this moment where she would be able to sue, take Ailes to court and drag this out in the public spotlight. That's why Carlson is able to come away succeeding.

ROMANS: And there's really two FOX News stories same time, really, three if you count the fact that important, that Roger Ailes is still an informal adviser to the Trump campaign.

So, let's talk about Greta Van Susteren. So, she tried to use a key man clause in her contract to walk away and they abruptly shut the door on her. Tell me what happened.

STELTER: This is aftermath or aftershock from the Roger Ailes resignation, because Ailes left she was able to leave as well. She had a clause in her contract allowing her to leave if Ailes left. And so, she decided to exercise that. And it's an example of how there continue to be consequences as a result of Ailes departing.

FOX News is in a very situation for the network, in a tumultuous sort of situation. This is a network known for stability and right now, they've seen a number of anchors leave, contributors leave and maybe more to leave as a result of Ailes departing.

So, Van Susteren back in July said she was not aware of harassment. She herself had never been harassed. She used the opportunity to try to renegotiate. Fox shut her down. She said she decided to leave. BERMAN: She said it hasn't felt like home for a long time in her

statement, that was interesting.

STELTER: Which insinuates the drama or behind FOX News, partly involving Ailes, but partly involving what the channel will become without Ailes. You know, he was the only founding CEO and chairman, the only person running the network for the past 20 years.

So, no one really knows what FOX News is without him. Now, we're slowing finding out. There's been new people inside for a few weeks. She said she didn't like the way things were going there. She decided to exercise that clause and leave. The speculation what she'll do next, she wants to return to broadcasting. Some people there will be a Trump TV network in the future. I think that's down the road for her though.

ROMANS: Speaking of Donald Trump, Roger Ailes is not a part of the campaign, but he advises -- Roger Ailes advises Donald Trump.

STELTER: You can -- if you listen to Trump's speech, I can hear Ailes in Trump's voice. Certainly, Ailes is an influential voice talking with Trump on the phone. There's a meeting at Trump's golf course in New Jersey.

They're kind of splitting hairs here saying he's not actually an adviser to the campaign but he is an adviser to Trump, and that's what matters.

BERMAN: Yes, I was pressing Trump, you know, A, supporters yesterday how does it look to have a guy in the middle of a $20 million sexual harassment settlement as a key adviser. At least a key debate adviser, they seem unconcerned.

STELTER: You know, one of the things we know about Donald Trump right now, for the past year, is he's very, very loyal to his friends. Ailes is a longtime friend. However, every time Ailes is in the news, it is about the sexual harassment scandal which is not over yet, partly because of the settlements, partly because of there's still a lawsuit against him by ex-host Andrea Tantaros.

[04:55:06] Ailes and Trump, Ailes and Trump, the two names together, I do wonder if it poses a problem for Trump at least among some voters. But it's hard to know, and I think we're looking at polling data, you can't really suss out what exactly is going on here.

BERMAN: Brian Stelter, great to have you with us this morning. Appreciate it.

STELTER: Thanks.

ROMANS: Thanks, Brian.

STELTER: All right. A hurricane could start to affect weather in Arizona. Meteorologist Pedram Javaheri joins to us explain.

(BEGIN VIDEOTAPE) PEDRAM JAVAHERI, AMS METEOROLOGIS: John and Christine, it is a pretty unusual set up here when you have a hurricane, of course, making landfall about 24 hour across the Cabo San Lucas area. It's the Mexican state of Sonora to the north that you see a second landfall. This is still a category 1 hurricane.

And, of course, still strong enough to some of the models projecting this moves on to parts of southern Arizona as a tropical storm. If that happens, we're talking about a very rare situation with only five storms since 1929 having regained those strengths as a tropical system as they move into Arizona. Of course, this would be number six as it happens later on today.

But regardless, you know, tremendous rainfall associated with the system, is going to go into areas of Nogales, eventually into Tucson, could get about 10 percent of their annual rainfall over the next 24, 48 hours. So, we have flood watches in place across parts of New Mexico and also into Arizona as well.

Now, take a look at this, Hermine is still hanging on off the Eastern Seaboard. It literally is trapped or blocked by the high pressure off to the east, another one back to its west. So there it is right there, just a few scattered showers across the region. But over the next few days big time warming trends remain in place around the Northeast, while the Midwest finally get some relief in the forecast -- guys.

(END VIDEOTAPE)

ROMANS: All right. That's your weather. Thanks, Pedram.

Let's get to your money now. Could stocks be on the verge of another run of record highs. NASDAQ hit a fresh all-time high yesterday. The Dow is about 100 points away from its own. Futures are up slightly this morning. Stock markets in Europe and Asia are mixed. Oil is up.

Amazon is on fire.

BERMAN: My favorite Alicia Keys song.

ROMANS: The stock hit an all-time high yesterday, now trading at $790 a share. Shares are jumping more than 16 percent this year. Amazon is now worth a staggering $370 billion. That makes it the fourth most valuable company in the U.S. behind only Apple, Google, and Microsoft. Founder Jeff Bezos is now worth $67 billion with B, neck and neck with legendary investor Warren Buffett.

Here's a payoff for investors, though. If you bought $10,000 of Amazon stock five years ago today, it now would be worth $36,000. Over that same span, the S&P 500 would have retained a gain of about $8,700. That's the would have, could have, should have segment of the morning.

Another for-profit college is closing, leaving tens of thousands of students without a path to graduation, and taxpayers could be on the hooks for their loans. ITT Educational Services shutting down more than 100 ITT technical institute campuses immediately. The company is accusing the federal government of unfairly stripping it of eligibility for student aid.

This comes after the U.S. Department of Education barred this school from allowing any new student to use federal loans to pay for classes there. About 40,000 students are enrolled in classes at ITT nationwide, 8,000 faculty members and staff will be also be out of work. The big question now, will the government forgive the federal loans of former and current students? Some estimates put that figure as high as $500 million.

But I can tell you, what the government has been doing, Department of Education has been looking at the for profit colleges, you might remember, last year, and just said, look, some of these are taking taxpayer -- you know, taxpayer-backed student loan aid, federal aid, and they're not really delivering on the promise of giving an education. They really clamped down on that.

BERMAN: There's room for oversight, important oversight.

ROMANS: Right.

BERMAN: EARLY START continues right now.

(MUSIC)

ROMANS: It's national security day on the campaign trail. Get ready for a big one. Hillary Clinton, Donald Trump, the very latest, including the very latest accusations from both campaigns both just moments away.

BERMAN: President Obama lays into Congress for refusing to act on his trade deal. We'll bring you some of the president's remarks. CNN is live in Laos.

Good morning, everyone. Welcome to EARLY START. I'm John Berman.

ROMANS: And I'm Christine Romans. It is Wednesday, September 7th. It's 5:00 a.m. in the East.

New this morning with no lead in his presidential race, national security will be in the spotlight with new proposals and new attacks on the way. Aides to Donald Trump say this morning, Trump will call for a significant release on military spending and to restore military budget cuts that were part of the sequester.

Trump will also go after Hillary Clinton's foreign policy vision which he says favor, quote, "military adventurism." Overnight, Trump seemed to reveal part of his secret plan to defeat ISIS. That now plans seems to be an order to generals to figure out a plan to beat ISIS in 30 days, and Trump blasted Secretary Clinton over her emails and claimed she never talks about policy. So much going on.

CNN's Sara Murray traveling with the Trump campaign brings us the latest.

(BEGIN VIDEOTAPE)

MURRAY: Good morning, John and Christine.

Well, Donald Trump stuck to his message of national security as he was campaigning yesterday in Virginia and in North Carolina.