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EARLY START

FBI Refused White House Request to Knock Down Recent Trump- Russia Stories; Trump Heads to CPAC; Mixing Politics With Intel?; Iraqi Force Retake Mosul Airport. Aired 4:30-5a ET

Aired February 24, 2017 - 04:30   ET

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


[04:30:06] DAVE BRIGGS, CNN ANCHOR: Did the White House try to get the FBI to push back against reports the Trump campaign spoke with Russia and did it violate procedure by speaking with the bureau? Exclusive CNN reporting and the White House response you don't want to miss.

CHRISTINE ROMANS, CNN ANCHOR: President Trump getting ready to speak at CPAC after his vice president and top advisers set the stage. We'll tell you what to expect.

BRIGGS: And concern among intelligence officials that the White House is injecting politics in their agencies to suit its need on the upcoming travel ban. We'll tell you why.

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

ROMANS: It's nice to see you, Dave Briggs.

BRIGGS: Good to see you, my friend.

ROMANS: And it's Friday, which is really the best news headline of the morning. I'm Christine Romans. It's 30 minutes past the hour.

The White House overnight voicing objections to exclusive CNN reporting about communications between the Trump campaign and Russia. Multiple U.S. officials tell CNN the rejected a White House request that it knocked down reports about constant communication between Trump campaign officials and Russians known to U.S. intelligence. CNN and "The New York Times" first reported on that last week.

Late last night, Press Secretary Sean Spicer objected to our characterization of the White House request to the FBI. He told CNN, he told us, "We didn't try to knock down the story. We asked them, the FBI, to tell the truth."

BRIGGS: Another White House official said that the request was made only after the FBI indicated to the White House it did not believe the reporting on communications during the campaign was accurate. Even if that were the case, the White House reaching out to the FBI would violate procedures on communications with the bureau about active investigations that go back to 2007.

CNN's Evan Perez was part of the team that broke this story. He has more from Washington.

(BEGIN VIDEOTAPE)

EVAN PEREZ, CNN JUSTICE CORRESPONDENT: Christine and Dave, a U.S. official says this all began with FBI Deputy Director Andrew McCabe and White House Chief of Staff Reince Priebus on the sidelines of a separate White House meeting on the day offer the stories were published. A White House official says that McCabe told Priebus that "The New York Times" story overstated what the FBI knows about these contacts.

But a U.S. official says that McCabe didn't discuss the aspects of this case and we don't know exactly what McCabe told Priebus. A White House official says that Priebus did later on reach out again to McCabe and to FBI Director James Comey asking for the FBI to at least talk to reporters on background, to dispute the stories. The FBI refused.

The FBI has refused to comment on this story.

The communication with the White House and the FBI was unusual because of a decade restriction on such contacts. The request from the White House would appear to violate procedures that limit these types of communications with the FBI on pending investigations. A White House official says that McCabe initiated these conversations.

But either way, the White House asking the FBI to help refute these stories runs contrary to Justice Department procedure memos that were issued in 2007 and 2009 that are supposed to limit direct communications on pending investigations with the White House and the FBI -- Christine, Dave.

(END VIDEOTAPE)

ROMANS: All right. Evan Perez for us in Washington -- thanks for that reporting, Evan.

Today, President Trump addresses the conservatives who helped him in office. The president speaks at the Conservative Political Action Conference, known as CPAC. We'll hear from him this morning, shortly after 10:00, we're told. His warm-up act went before the conservative faithful Thursday. The Vice President Mike Pence ripping Obamacare and dismissing the angry town halls we've seen across the country this week.

(BEGIN VIDEO CLIP)

MIKE PENCE, VICE PRESIDENT OF THE UNITED STATES: Let me assure you. America's Obamacare nightmare is about to end, despite the best efforts of liberals at town halls around the country. The American people know better. Obamacare has failed and Obamacare must go.

(END VIDEO CLIP)

BRIGGS: The vice president followed a revealing on stage chat with White House Chief of Staff Reince Priebus and chief strategist Steve Bannon. This was a rare chance to hear directly from Bannon who seldom speaks in public since joining the administration.

More now from CNN's Jeff Zeleny at the White House.

(BEGIN VIDEOTAPE)

JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Good morning, Christine and Dave.

President Trump is heading to the Conservative Political Action Committee just outside Washington for the annual conference today, giving a speech later this morning to conservative activists.

Now, it was only a year ago where he skipped this annual event. Republicans there were working actively against him, saying they did not want him to win the nomination. They did not think he was a true conservative. But, boy, what a difference and a victory a year makes. He is going back to this gallery today as the man of the moment.

Activists are excited to see him. They're excited to hear his agenda and rally him forward.

Now, Steve Bannon, the White House chief strategist who has influence all over the White House is seldom heard from.

[04:35:00] Well, he made an appearance yesterday and gave a clear sense of his world view and what the president plans to do in office.

STEVE BANNON, WHITE HOUSE CHIEF STRATEGIST: If you think they're going to give you your country back without a fight, you are sadly mistaken. Every day, every day, it is going to be a fight, and that is what I'm proudest about Donald Trump, that all the opportunities he had to waiver off this. All of the people who have come to him and said, you've got to moderate.

Every day in the Oval Office, he tells Reince and I, "I committed this to the American people. I promised this when I ran. And I'm going to deliver on this."

ZELENY: Now, that, of course, will be music to the conservatives ears there, except for how all these programs will be paid for. There is still talk of tax reform, health care reform and, of course, paying for that wall with Mexico.

And don't look for any of those specific details to come in the president's speech today. I'm told this is more of a rallying moment, a rah-rah moment if you will. But, boy, again, a difference a year makes. Donald Trump now clearly the man of the moment today at CPAC -- Christine and Dave.

(END VIDEOTAPE)

ROMANS: Yes, I think it was Kellyanne Conway yesterday. They should call it TPAC. Look, that was a year ago where conservatives were thinking he wasn't conservative enough, right? And now, he is sort of the darling there. BRIGGS: Well, CNN has a piece online asking people at CPAC if Donald

Trump is a true conservative. Many weren't sure how to answer, including the head of the conference. They were trying to couch the words just right. It was an interesting.

ROMANS: It will be interesting. About six hours, the president will take the stage.

All right. There's concern among some in the intelligence community that the White House may be politicizing intelligence related to its travel ban. A senior White House official tells CNN that President Trump has assigned the Department of Justice and Homeland Security to help build the case for the temporary ban on travelers from the seven Muslim majority countries. The ban was blocked by the federal courts. The official says the evidence for the security threat from those countries is substantial.

But some intelligence officials tell CNN they are worried the Trump White House is shopping around among agencies, seeking an intelligence report to fit its policy instead of the other way around. The White House declined to make an on-the-record comment for this story.

BRIGGS: The White House putting the brakes on two more policies from the Obama administration. The Justice Department rescinding an order to discourage the use of private prisons to house federal inmates. The aim is to support what's future needs, which may include the detention of undocumented immigrants. Most inmates were steered to state facilities under Obama administration directive.

ROMANS: White House also stepping up enforcement of recreational marijuana laws, even in states where it is legal. The Obama administration had directed federal officials not to interfere in states which legalized recreational use. The decision to give more power to the federal government came the day the administration did the opposite on guidance protecting transgender students saying the policy is best left in the hands of states and school districts.

BRIGGS: A new follow-on on that story, arguably the most high profile face of the transgender community. Caitlyn Jenner is speaking out. Jenner, a long time Republican, Trump supporter, she has a message for the president.

(BEGIN VIDEO CLIP)

CAITLYN JENNER, ADVOCATE FOR TRANSGENDER RIGHTS: I have a message for President Trump from one Republican to another. This is a disaster. And you can still fix it. You made a promise to protect the LGBTQ community. Call me.

(END VIDEO CLIP)

ROMANS: That has been shared a lot in the past few hours.

BRIGGS: Retweeted almost 10,000 times. It was a tweet that was sent out last night around 10:00. So, it is catching fire.

ROMANS: We'll see if President Trump calls Caitlyn Jenner.

BRIGGS: Clearly, they are saying this is about state rights. Not about the transgender issue and that's --

ROMANS: All right. There are new calls for President Trump's tax returns this morning. At several town hall events, constituents demanded the lawmakers pushed for the release of the president's tax information, many feeling it's the only way to make sure the president does not have international conflicts of interest, especially with Russia.

And one GOP congressman from Florida, an ardent Trump supporter, says he agrees.

(BEGIN VIDEO CLIP)

REP. MATT GAETZ (R), FLORIDA: Let me say right here right now absolutely Donald Trump should release his tax returns.

TOWN HALL ATTENDEE: Would the judiciary committee get him to release tax returns? Y'all can --

GAETZ: Well, I'm one member of the Judiciary Committee. But I do believe that Donald Trump should release his tax returns.

(END VIDEO CLIP)

ROMANS: President Trump is not legally obligated to release his returns. But it is tradition. Every president and presidential nominee has done so for past 40 years. During the campaign, the president said he would release his returns when they are done being audited. But the IRS audits do not prevent individuals from disclosing tax data.

BRIGGS: Donald Trump is going to take his name off buildings than he is going to release his taxes.

ROMANS: I don't think he's going to release his tax returns.

BRIGGS: Unless someone forces him to do it, which would be Congress.

ROMANS: And his supporters say, look, you know, he was elected without showing his tax returns. So, that's it.

(BEGIN VIDEO CLIP)

[04:40:03] JOHN BOEHNER (R), FORMER HOUSE SPEAKER: To repeal the job killing health care law, so we get started on replacing it.

It should be repealed. It should be replaced.

We can repeal Obamacare and replace it.

(END VIDEO CLIP)

BRIGGS: Former House Speaker John Boehner spent years advocating just that. But he is now throwing cold water on the idea the Republicans can actually repeal and replace Obamacare.

At a health care industry conference in Florida, John Boehner said the Congress and Senate will wind up repairing, not repealing Obamacare.

(BEGIN VIDEO CLIP)

BOEHNER: I shouldn't call it repeal and replace because that's not what's going to happen. Basically, he will fix the flaws and put a more conservative box around it. It's not all that hard to figure out, except this, in the 25 years I served in the United States Congress, Republicans never ever one time agreed on what a health care proposal should look like. Not once.

All of this happy talk went on in November, December and January about repeal, repeal. Yes, we'll do replace, replace. I started laughing because if you pass repeal without replace, first, anything that happens is your fault.

(END VIDEO CLIP)

BRIGGS: The former speaker also weighed in on the first month in the Trump administration. He says the Trump administration will likely look much like the Trump campaign -- sometimes divisive, in incoherent or disrespectful. But he says also sometimes effective. Not exactly a bumper sticker.

ROMANS: It was effective because he's the president of the United States, right?

All right. Did President Trump's lawyer promise to deliver a peace plan for Ukraine directly to the White House? The Ukrainian lawmaker says yes. And he is speaking out to CNN. We go live to Kiev.

(COMMERCIAL BREAK)

[04:45:59] BRIGGS: New revelations about a controversial peace plan to settle the conflict between Russia and Ukraine. A Ukrainian lawmaker says he presented his plan for peace to President Trump's personal lawyer Michael Cohen. His lawyer says Cohen planned to take that plan to the national security adviser.

That lawmaker now facing a treason investigation in Ukraine. He's given his first western TV interview to CNN.

Senior international correspondent Nick Paton Walsh is live in Kiev.

Nick, we understand you have new information this morning. It's a bit of a complex story if you can. Walk us through it.

NICK PATON WALSH, CNN SENIOR INTERNATIONAL CORRESPONDENT: It's a confusing picture really, but it involves a dinner at a luxury Manhattan hotel between Michael Cohen, Donald Trump's personal lawyer. That Ukrainian MP Andrii Artemenko and businessman Felix Sater, and it also gives a strange window certainty now in public perception, a lot denials about what was said at that meeting, the public perception of how foreign policy and diplomacy is conducted toward and around the Trump White House.

Here's what Andrii Artemenko had to say to me.

(BEGIN VIDEO CLIP)

ANDRII ARTEMENKO, UKRANIAN LAWMAKER: We probably spoke around 20, 25 minutes where I present my intentions, my peace plan for the Ukraine, how we can stop the war, how we can finish this. And also he says, listen, this is a gentleman that's very potential and he wants to send your message to Trump administration.

WALSH: When you first spoke to Felix Sater, did you ever mentioned that your peace plan would end up on the then-National Security Advisor Michael Flynn's desk?

ARTEMENKO: No, absolutely not. It was the Michael Cohen idea. He mentioned his name first in my meetings. He said, listen, Michael Flynn for his personal opinion is most powerful man who can really support this idea, who really support -- who can help you, who can provide his information to President Trump.

(END VIDEO CLIP)

WALSH: Disagreement still about what was said about dinner. Felix Sater saying he was there, peace was discussed and Michael Cohen said it was, quote, "National Security Adviser Flynn issues," suggesting he will perhaps take the plan on.

Michael Cohen, however, said he was at the meeting, yes, but flatly denies discussing peace at all, calls this an example of fake news and they never discussed peace, this issue with Mr. Cohen or Mr. Artemenko. Disagreement persists.

But here in Kiev is this public perception because of the reporting on this and the claims, that potentially if you find somebody from Mr. Donald Trump's business past like his personal lawyer, you might over dinner in Manhattan be able to get that idea floated up to the national security adviser. Back then, Michael Flynn. That is some say potentially good news if you think anything is worth trying in terms of getting peace in Ukraine.

The bad news if you Putin investment in the official peace process, which is stalled here certainly. But he question people are asking, is where is the State Department in all this? Where are the long term U.S. channels meant to be behind this kind of U.S. diplomacy -- Dave.

BRIGGS: Yes, Rex Tillerson left out of the discussions internationally. Thank you, Nick.

More to come on this story.

ROMANS: All right. We are now learning that a chemical weapon known as VX nerve agent was used to kill Kim Jong-nam, the half brother of North Korea's dictator. A preliminary report from authority says the potent poison was found on Kim's eyes and face. He was attacked at an airport by two women this month in Kuala Lumpur. Three North Korean nationals are still wanted for questioning, including who works at the North Korean embassy in Malaysia.

It's just a bizarre story there.

All right. The Dow Jones industrial average is on fire. Ten straight days of record highs. Yesterday, we told you this was the longest streak since 1987. Today, I'll tell you about another streak dates back to 1897. Little history lesson for your money this morning.

(COMMERCIAL BREAK)

[04:54:15] BRIGGS: The U.S. military is considering a long term presence in Iraq to stabilize the country after anticipated fall of ISIS. That's according to the chairman of the joint chiefs, General Joseph Dunford. He says the U.S. and NATO had begun discussion with Iraq about helping to grow and improve Iraqi security forces. But he cautions no decisions have been made.

This comes as U.S. backed Iraqi forces gain ground against ISIS. Iraqi warplanes bombing three cities, killing 85 ISIS fighters. This includes ten militants in western Mosul where Iraqi forces are working to liberate the city.

CNN international correspondent Nina Dos Santos joins us live with more.

Good morning to you.

NINA DOS SANTOS, CNN INTERNATIONAL CORRESPONDENT: Good morning. Thanks so much, Dave.

[04:55:01] Well, yes, there has been a big development in the fighting on the western side of the Tigris River in Western Mosul today. That is the fact that Iraqi forces have not only been able to capture the airport in the southwest of the city, but they've also managed to capture key military camp adjacent to the airport.

So, we're talking about a large amount of surface area of land towards the southwest of the city. And from here, the hope is that they were going to be able to push swiftly toward not densely populated, largely industrial and military facilities further towards the north and taking in a key power plant which is subject to fierce fighting between ISIS and Iraqi forces yesterday. No word as yet as to whether they managed to secure that power plant.

But if they have, then they'll have access to key infrastructure before they push north and west to some more densely populated older parts of the city. And that's really where the difficult battle is going to begin. We are talking about some 650,000 civilians who call the older neighborhoods of Mosul their home. There is going to be concerns about civilian casualties here, also because the terrain is going to be quite difficult for these forces to fight.

The streets are too narrow for their military vehicle. So, they're probably going to have to fight on foot and house to house. That raises possibility of ISIS suicide bombings and very other booby traps and ambushes. In the meantime, though, to keep spirits up of the 650,000 civilians potentially trapped, we have seen planes dropped letters that were penned by people liberated in eastern Mosul, telling those people stay inside your houses and when and if -- when that force and push eventually comes, see these people as your friend and not as foe. Don't hinder them. Help them -- Dave.

BRIGGS: Again, long term commitment is not what Americans want to hear at this point.

Nina, thank you.

ROMANS: All right. New York City Mayor Bill de Blasio will be on the hot seat today. Federal prosecutors expected to grill him in connection with the corruption investigation into fundraising. Multiple reports suggest donors to his 2013 mayoral campaign and related non-profit may have received special favors for their contributions. De Blasio adamantly denies he or his aides did anything wrong.

BRIGGS: Remember Punxsutawney Phil's prediction forecasting a late spring, do you? I do. I always watch it. Not even close.

Let's bring in meteorologist Derek Van Dam for a real forecast.

Good morning to you.

(BEGIN VIDEOTAPE)

DEREK VAN DAM, AMS METEOROLOGIST: You have to see this, Dave and Christine. Leaves on the trees are appearing 20 to 25 days earlier than usual across the South. This is amazing. All thanks to the prolonged warmth we had across this region.

And once again, we will break many records across the eastern and southern parts of the U.S. With the set up, we have potential for severe weather across the Ohio River Valley. On the backside of this low pressure system, a powerful winter storm is ongoing across Iowa and Minnesota and Wisconsin and parts of Michigan. So, a mixed bag of weather today.

We will be measuring snowfall upwards of a foot across the border of Wisconsin and Minnesota and Iowa. So, drive with care across the region.

Check out these temperatures. You can certainly see where the cold front sweeps in. Nashville, 80 degrees today, 47 for tomorrow afternoon temperature. And then we cool things down across the Deep South.

And even into New York City, you're basking in some warmth. It cools off this weekend.

Back to you.

(END VIDEOTAPE)

ROMANS: Derek Van Dam, thank you for that. Now, it's time for some money. Let's take get a check on CNN Money

Stream.

The Dow hitting another major mark. Ten record highs in a row. Dow up more than 750 points over the ten trading days. Unbelievable.

Futures are slightly lower right now. Watching it drop in global stock markets. But if the Dow keeps going, just a few more days, it will hit two major milestones. Along the longest streak of record highs is 12. That was set back in 1987. The longest streak at closing bell is 14. That was set back if 1897, David Briggs.

(CROSSTALK)

ROMANS: Check out some of these big names. Each of these companies hit all-time highs on Thursday. You may have them in your portfolio. They are widely held stocks folks.

Amazon, Apple, Home Depot, Boeing, Southwest, JPMorgan Chase, and these are just a handful of the S&P 500 stocks at all time highs.

It shows how brought this rally has been. Nearly every sector has hired this year. These are widely held stocks for your retirement account is likely benefitting.

BRIGGS: Good news.

ROMANS: So, what's the catalyst for all the records right now? Well, yes, investors are excited about Trump's promises to roll back regulations and spend big on infrastructure. And despite recent comments it will raise rates soon, many believe the Federal Reserve is behind the economic curve. That's keeping cheap money flowing.

But the biggest prize for Wall Street would be tax cuts. Investors feel that will boost corporate profits. It will help companies make more money. And yesterday, the treasury secretary yesterday laid out an ambitious timeline.

(BEGIN VIDEO CLIP)

STEVEN MNUCHIN, TREASURY SECRETARY: We are committed to pass tax reform. It will be very significant. It's going to be focused on middle income tax cuts, simplification and making the business tax competitive with the rest of the world, which has been a big problem and a lot of reason why companies are leaving and cash are sitting offshore.