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EARLY START

George H.W. Bush Hospitalized; Obama Commutes Chelsea Manning's Sentence; Trump's Final Days Before Inauguration; Four Cabinet Hearings Today on Capitol Hill. Aired 4-4:30a ET

Aired January 18, 2017 - 04:00   ET

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


[04:00:09] JOHN BERMAN, CNN ANCHOR: All right. Quite a backlash after President Obama commutes the sentence of Chelsea Manning. How did this move affect interactions against those who leaked classified material?

CHRISTINE ROMANS, CNN ANCHOR: The president-elect is making final preparations for his inauguration Friday and he's taking a hands on approach, getting his speech ready as more Democrats decide to boycott.

BERMAN: And a critical day on Capitol Hill. The man charged with overhauling Obamacare faces the Senate a day after the education nominee runs in some pretty angry pushback.

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

ROMANS: Good morning. I'm Christine Romans. It is Wednesday, January 18th. It is 4:00 a.m. in the East.

And breaking news this morning, 92-year-old former President George H.W. Bush has been hospitalized in Houston. This is according to local media. His office chief of staff Gene Becker tells KHOU-TV and the "Houston Chronicle" that the elder President Bush is doing fine, although the reason for the hospitalization was not immediately disclosed. Bush's office says it expects him to go home in a couple days. Again, he's 92 years old.

BERMAN: You know, he's one president not attending the inauguration. That had already been decided because of his ongoing health issues. He's been in the hospital last few years. He's 92. He's dealt with some health issues.

But I will tell you when he's not in the hospital, even when he is, he's living life to the fullest and enjoying it.

ROMANS: All right. Two days before the new president takes office, the outgoing president drops a big surprise. It may have a huge effect on future leaks and leakers of government secrets.

President Obama rocking Washington by commuting Chelsea Manning's 35- year prison sentence. The former Army private convicted of leaking 750,000 pages of documents and videos, now set to be released in May. The move whipping out immediate controversy and a backlash not just from Republicans.

A senior defense official tells CNN Mr. Obama shortened Manning's sentence over objections from his own Secretary of Defense Ash Carter. Manning released the secret documents in 2010 through WikiLeaks, which has been advocating her release from the moment she was arrested. Of course, this past election, WikiLeaks and its founder, Julian Assange, leaks documents that the intelligence community says were hacked by Russia, with the aim of helping Donald Trump win the election. There has been no word, so far, from the Trump team.

BERMAN: Now, Julian Assange has been held up in the Ecuadoran embassy in London for nearly five years, wanted by Swedish authorities in an unrelated sexual assault case. Assange has said he fears surrounding to Sweden could lead him to be handed over to the U.S. for prosecution of his work on WikiLeaks.

But last week, WikiLeaks tweeted this. It said, "If Obama grants Manning clemency, Assange will agree to U.S. extradition despite clear unconstitutionality of the Department of Justice case."

So, now that Manning, his sentence commuted, did Assange really mean all of that?

Let's get the latest from the White House right now. Michelle Kosinski is there for us.

(BEGIN VIDEOTAPE)

MICHELLE KOSINSKI, CNN WHITE HOUSE CORRESPONDENT: Hi, John and Christine.

Right. So, now, we're hearing from White House senior officials who are boiling down the White House's thinking on this commutation to three points -- that Chelsea Manning accepted responsibility for her crimes, that she expressed remorse for them, and that she already served more than six years of a very long sentence, originally 35 years. They said President Obama feels that that is sufficient, especially compared to others who have committed similar crimes.

They don't want to back away from the seriousness of those crimes, though. What they're saying is that President Obama still has serious concerns about the crimes that she committed, that they were not good for national security, and that the U.S. had to take steps to mitigate damage that was done from them.

The White House was asked, well, does this have anything to do with humanitarian grounds, the fact that Manning is transgender and has struggled while she's been held in prison, that she tried to commit suicide? They didn't get into that.

They also said this had nothing to do with Julian Assange of WikiLeaks promise that if her sentence was commuted, that he would be willing to face extradition to the U.S. to stand for his crimes. They said that this commutation was based only on those points that I mentioned. And, you know, it remains to be seen whether a song honors that promise that he made -- John and Christine. (END VIDEOTAPE)

ROMANS: All right. Michelle, thank you, at the White House.

Moments after the clemency announcement, WikiLeaks tweeted victory and a brief statement from Julian Assange, "Thank you to everyone who campaigned for Chelsea Manning's clemency. Your courage and determination made the impossible possible."

The ACLU and Amnesty International also cheered news of Manning's commutation.

BERMAN: But on Capitol Hill, quite different reaction. Democratic Senator Joe Manchin from West Virginia says the shortened sentence was dead wrong, and gave a green light to hacking and cyber attacks.

(BEGIN VIDEO CLIP)

[04:05:00] SEN. JOE MANCHIN (D), WEST VIRGINIA: That is wrong.

REPORTER: Why is that?

MANCHIN: That was treason and espionage. It should have been 35 years.

(END VIDEO CLIP)

BERMAN: Republican Senator Lindsey Graham told CNN's Dana Bash, "Manning stabbed his fellow shoulders in the back by releasing classified information and putting their lives at risk. President Obama, by granting clemency to Manning, slapped all of those who serve honorably in the face."

ROMANS: And Senator John McCain said that it actually dilutes their real service by real whistleblowers who go proper channels. It really dilutes their sacrifice and their efforts this clemency, this commutation.

All right. President Obama granted pardons or commutations to more than 200 other people including retired four-star General James Cartwright. In 2012, Cartwright pleaded guilty to a single charge of making false statements to federal investigators about leaking top secret information to journalists.

And baseball Hall of Famer Willie McCovey also has been pardoned for a tax evasion conviction from 1995. In a statement, he said, "I want to express my sincere gratitude to President Obama not only for his kind gesture on my behalf, but also for his tireless service to all Americans."

BERMAN: You know, Ian Schrager of Studio 54 commuted, or pardon --

(CROSSTALK)

ROMANS: Hotel and restaurant mogul. BERMAN: All right. This morning, Donald Trump wakes up at Trump Tower, his final day there before moving to Washington. We're told he is finishing up the writing of his inaugural address. And unlike the campaign when he spoke off the cuff, or delivered speeches written by aides, the transition claims that the president-elect is writing this one himself.

CNN's Jeff Zeleny has a preview as the last full day in New York as president-elect.

(BEGIN VIDEOTAPE)

JEFF ZELENY, CNN SENIOR WASHINGTON CORRESPONDENT: John and Christine, two days before Donald Trump takes office, he's putting the finishing touches on his inaugural address. We're told that he's writing it himself after watching and reading several recent addresses and ones from history. He studied President Ronald Reagan and even President Barack Obama's.

Now, the president-elect made a quick trip to Washington last night for the first inaugural event, at Chairman's Global Dinner, featuring diplomats from around the world, as well as Vice President-elect Mike Pence and some of their top campaign contributors. He's back in New York today, scheduled to spend the final day working out of Trump Tower. His last day before he becomes president, before moving to Washington on Thursday.

Now, Washington is alive with activity with all of the traditional transfer of power. President Obama gives his last press conference today at the White House, even as four key confirmation hearings unfold on Capitol Hill.

Now, the list of House Democrats boycotting the inauguration continues to grow, now more than 50. But so far, no Senate Democrats have added their names to that list. That's important. Trump will need the cooperation of some of them to get his agenda through Congress.

But it's also important to remember, starting Friday, Republicans control the House, Senate and White House for the first time in a decade, a new wilderness for Democrats if they're protesting or not -- John and Christine.

(END VIDEOTAPE)

ROMANS: All right. Jeff Zeleny, thank you.

As Jeff mentioned, President-elect Trump was briefly in the nation's capital last night, attending a black tie invitation-only dinner. It was held for foreign diplomats to meet members of the incoming administration --

BERMAN: I'm not sure he's in black tie.

ROMANS: I think he's in black tie. The president-elect was, it is a long tie, no, it's not black tie. He was quick to praise former ExxonMobil CEO Rex Tillerson, his controversial nominee for secretary of state.

(BEGIN VIDEO CLIP)

DONALD TRUMP (R), PRESIDENT-ELECT: We have great respect of countries. We have a great respect for our world. We have a man that I wanted right from the very beginning, Rex Tillerson. And these lights are bright but he's out there somewhere. Where is Rex?

Thank you very much. Thanks, Rex.

I think it's tougher than he thought. He thinks -- you know, he's led this charmed life. He goes into a country, takes the oil, goes into another country --

(LAUGHTER)

It's tough dealing with these politicians, right? He's going to be so incredible.

(END VIDEO CLIP)

ROMANS: Tillerson may face an uphill battle for confirmation. Several GOP senators, including John McCain and Marco Rubio say they are still on the fence about voting for him.

BERMAN: All right. Confirmation hearings get underway in the Senate today for four more of the president-elect's cabinet picks. Wilbur Ross is the nominee for commerce secretary. Scott Pruitt tapped to head up EPA. South Carolina Governor Nikki Haley up for U.N. ambassador, or ambassador to the United Nations. And Georgia Congressman Tom Price has been tapped to be secretary of health and human services.

It was pretty tough day of questioning already for education secretary nominee Betsy DeVos.

Let's get the latest from CNN's Phil Mattingly on Capitol Hill.

(BEGIN VIDEOTAPE)

PHIL MATTINGLY, CNN CORRESPONDENT: John and Christine, week two of confirmation madness kicked off on Tuesday. It was really kind of one primary hearing everybody was focused on, and that was the president- elect's selection to be his next education secretary, Betsy DeVos.

Now, she is well-known both in political circles and in education circles for a couple of reasons. Politically, she comes from a family, and she herself, some of the biggest donors in the Republican Party.

As part of that donation, a part of where their money goes, education reform. Vouchers, charter schools, big issues that the DeVos family and Betsy DeVos in particular have focused on that have made her a prime target for Democrats.

[04:10:01] And that's certainly showed in her confirmation hearing. Take a look at this exchange between Senator Elizabeth Warren and Betsy DeVos, primarily on how much experience the nominee actually has.

SEN. ELIZABETH WARREN (D), MASSACHUSETTS: Mrs. DeVos, have you ever taken out a student loan from the federal government to help pay for college.

BETSY DEVOS, EDUCATION SECRETARY NOMINEE: I have not.

WARREN: Have either of your children borrowed money in order to go to college?

DEVOS: They've been fortunate not to.

WARREN: Uh-huh. Have you had any personal experience with the Pell Grant?

DEVOS: Not personal experience, but certainly friends and students with whom I've worked.

WARREN: So, you have no personal experience with college financial aid or management of higher education?

MATTINGLY: Now, even though there were consistent attacks from Democrats and outside groups, particularly public school teacher, labor unions have been really targeting her nomination, she has a lot of heavy support as well. Jeb Bush, obviously the tormenter, or tormentee, if you will, of the president-elect throughout the Republican primary process has come out in support. A lot of outside support, a lot of Republicans who feel like Betsy DeVos represents the direction they want to go when it comes to federal education policy. They've gotten behind her nomination.

And there's every expectation that she will be confirmed barring some late-breaking development we haven't heard about yet.

Now, it becomes the view of who comes next, and guys, there's no question about it. Today's hearing with Tom Price, the selection to be secretary of health and human services is the biggest one on the docket, probably this week, maybe for the entire administration. Think about the number one policy issue for the president-elect -- repealing and replacing the Affordable Care Act. Tom Price has a huge role in that, not only because he has the expertise working on this issue on Capitol Hill, working as a doctor. But also in that role, he can do a lot unilaterally to help that process along.

But he has major problems as well. Democrats with pointed policy questions for him, but also pointed questions about Tom Price's ethics, how he operated on Capitol Hill, our own Manu Raju breaking a lot of news about how Tom Price used his private trading account, whether or not there was possibility of insider trader. We've seen a lot of Democratic senators point to that. So, that might be a problem.

Keep a very close eye on those questions. Now, Tom Price answers them at that hearing today John and Christine. (END VIDEOTAPE)

ROMANS: All right. Phil Mattingly, thank you so much for that.

All right. That's going to be an interesting --

BERMAN: Oh, it will be fascinating, especially with the news, you know, 18 million of CBO report on Obamacare coming up today.

ROMANS: All right. Donald Trump's pick for commerce secretary will face lawmakers later this morning, Wilbur Ross. And ahead of that meeting, he's reached a big agreement to divest from some of his empire, billions -- multiple billion dollar empire.

We'll tell you what he's selling and what he's keeping.

(COMMERCIAL BREAK)

[04:15:42] ROMANS: All right. Donald Trump's commerce secretary pick Wilbur Ross will face lawmakers today. Ahead of that hearing, the famed investor has reached an agreement with federal officials to avoid conflicts of interests.

If he's confirmed, Ross would step away from Invesco and its subsidiaries, including his firm WL Ross and Company. He would divest of various stocks and bonds, including shares of Apple and Boeing. Ross will delay selling dozens of less liquid assets like hedge funds for up to six months after his confirmation.

But the plan details nine passive investments vehicle he is keeping. Those involved shipping and real estate. While he may face questions on these holdings, pay close attention to whit he says about trade. That's where I'm really interested in what he says about trade, tariffs and border taxes in particular, whether you do trade through tax reform or other ways.

Look, he's going to take a bigger role in trade policy and negotiation. CNN sources are telling us, and many have said, his first goal will be to renegotiate NAFTA. So, very interesting what his views are going to be on China. I mean, China has said, the president-elect is playing with fire. What will he say about China and trade with China, about Mexico and about all of this pressure that the president-elect has been putting on companies to get them to announce that they're keeping jobs in the United States?

BERMAN: What they say about the fact that right now, there's a rift between Republican and Congress and seemingly the president-elect on tax reform. That will be interesting to see.

Pressure is mounting for Republicans to put forth a plan to replace Obamacare. And this comes as the budget office estimates 18 million Americans could lose insurance if the Affordable Care Act is repealed without an alternative.

Democrats are holding events across the country, rallying those who are insured under the program. Over the weekend, the president-elect said his plan is nearly complete, and he promised insurance for everybody. But some Republican lawmakers are expressing concerns as the process of dismantling the plan begins without details on replacement.

ROMANS: An 18-year veteran of a suburban Dallas police force has been killed in the line of duty. Detective Jerry Walker, a 48-year-old father of four was fatally shot yesterday in a standoff with a barricaded gunman. Walker is the first police officer from the Little Elm Police Department to be killed on the job. Authorities tell us the suspect was found dead inside that home last night. His identity has not been released.

BERMAN: The man suspected of killing an Orlando police officer and his own pregnant ex-girlfriend is now in custody after more than a -- after a while on the run. Police arrested Markeith Lloyd Tuesday after tracking him to an abandoned house. They say he was wearing body armor, had two handguns and he tried to escape. The Orlando police chief said that after a struggle, they put Lloyd in hand cuffs that belonged to slain officer Debra Clayton.

(BEGIN VIDEO CLIP)

CHIEF JOHN MINA, ORLANDO POLICE DEPT.: To put her handcuffs on the bad guy that she was trying to catch when she was killed is just significant, and is meaningful to her family, which I did tell Seth Clayton about it. It's meaningful to her OPD family as well.

(END VIDEO CLIP)

BERMAN: The 41-year-old Lloyd faces two murder counts. Police arrested three people for allegedly helping him evade capture. They say more arrests are expected.

Cooperstown is calling but for whom? The Baseball Hall of Fame Class of 2017 will be announced today. Outfielder Tim Raines finally, finally should get in. Hall of famers are chosen by the baseball writers. Now, what about the alleged steroids guys, Barry Bonds and Roger Clemens, who certainly has the numbers to get in? They're likely to miss the cut again.

However, however, it does seem that all of those people linked in some way to steroids over the years, performance enhancing drugs. Their numbers are getting better. And it might be that they get in eventually. That's sort of the new trend in the Hall of Fame. I know you were asking about that.

ROMANS: I know, I've actually been losing sleep over that whole.

BERMAN: But Tim Raines, I know you feel passionate about it. He deserves to be in the Hall of Fame. He had one of the great careers of all time and he's been denied up until now and should get in today.

ROMANS: What would I do without John Berman?

BERMAN: Succeeding.

(CROSSTALK)

ROMANS: Maybe sleeping.

Nineteen minutes past the hour.

Russian President Vladimir Putin accusations of spying are only to undermine the incoming president-elect. More on his comments live from Moscow.

(COMMERCIAL BREAK)

[04:23:24] BERMAN: Russian President Vladimir Putin is coming to the defense of Donald Trump. The Russian leader says the salacious but unsubstantiated claims, that 35-page report about Donald Trump were obvious fabrications. The Russian president calls the accusations part of the campaign to undermine the results of the U.S. presidential election.

Joining us now from Moscow, Jill Dougherty, former CNN Moscow bureau chief and now, a global fellow at the Woodrow Wilson Center.

And, Jill, you know, some colorful, very colorful comments from the Russian leader.

JILL DOUGHERTY, WOODROW WILSON CENTER: Yes, it was really an amazing moment, I'd have to say, because it was at a news conference, everything was relatively boring, and then, all of a sudden, this question came up right at the end. And President Putin went on for a number of minutes. I mean, basically what he said is there is a political battle as he put it under way in the United States to undermine the legitimacy of Donald Trump and his administration and also to tie his hands and his feet.

Then he got into that alleged salacious compromising material. And he said it was a complete fake. He ended up there in the Kremlin at that news conference talking about prostitutes. Here's what he said.

(BEGIN VIDEO CLIP)

VLADIMIR PUTIN, RUSSIAN PRESIDENT (through translator): Did Trump really come and meet with Moscow prostitutes? First, he is an adult. And second, he is a person who, for many years, has organized a beauty pageant, socialized with the most beautiful women in the world. It's hard to believe that he ran to a hotel to meet with our girls of a low social class, although they are the best in the world.

(END VIDEO CLIP)

[04:25:05] DOUGHERTY: He also said that people who fabricate and use this type of fake information are worse than prostitutes. And then he also went into Mr. Trump's visit way back when to Moscow. He said, we can't even know at that point that he was going to be a politician. And do you think that our security services are running around following every billionaire? And then he said absolute nonsense -- John.

BERMAN: So, the words of new diplomacy.

Jill Dougherty in Moscow for us -- thanks so much.

ROMANS: All right. Twenty-five minutes past the hour.

A horrible tragedy unfolding right now in Northeast Nigeria. The country's air force is now confirmed it mistakenly bombed a crowded refugee camp. The death toll overnight rising to 53, 100 other people were hurt. Nigerian military officials say their pilots were attempting to target Boko Haram, the terrorist group, but accidentally launched an air strike on civilians who had already fled. Humanitarian workers are among the dead. Just a tragedy there.

All right. President Obama stunning Washington by commuting the sentence of Chelsea Manning who leaked tens of thousands of classified documents of WikiLeaks. We've got more on the fallout, next.

(COMMERCIAL BREAK)

ROMANS: The prison sentence for Chelsea Manning commuted by President Obama. How could the move affect handling of leaks under future administrations?

BERMAN: Just two days until Donald Trump's sworn in as president. Final preparations under way, as more Democrats decide to boycott.

ROMANS: And a big day on Capitol Hill. Trump's nominee to overhaul Obamacare will face the Senate a day after the education nominee ran into pushback from Democrats.

Welcome back to EARLY START. I'm Christine Romans.

BERMAN: I'm John Berman. About 30 minutes after the hour right now. Nice to see you this morning.

ROMANS: We'll get to those in a moment. But, first, breaking news this morning, 92-year-old former President George H.W. Bush has been hospitalized in Houston.