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EARLY START

Trump: Gas Attack Changed His View Of Syria; Ambassador Haley Blasts Assad, Russia, U.N. Inaction; Russia Stands By Syrian President Assad; Trump's Summit With Chinese President Xi; North Korea At Center Of U.S.-China Summit; Tough Trade Talk Meets Reality; Trump Removes Steve Bannon From NSC; Trump Suggests Susan Rice Committed A Crime; Tornadoes Tear Up Southeastern U.S.; Pepsi Cans Kendall Jenner Ad. Aired 4:30-5a ET

Aired April 6, 2017 - 04:30   ET

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


[04:31:02] CHRISTINE ROMANS, CNN EARLY START HOST: President Trump changing his view on Syria, following a deadly chemical attack. U.S. foreign policy now under the microscope as the Chinese President heads to the U.S. We have live T.V. coverage from around the world beginning right now.

Welcome back to EARLY START. A very busy morning, a very important morning for this young administration. I'm Christine Romans.

DAVE BRIGGS, CNN EARLY START HOST: I'm Dave Briggs. Multiple foreign policy test for President Trump. It is 30 - 31 minutes past the hour. The President facing his first major foreign policy test in responding with outrage to a chemical weapons attack in Syria that killed scores of civilians. The president now signalling a major change in the Syria policy in the wake of the attack. As recently as last week, the administration said that ousting Syrian leader Bashar al-Assad was no longer a U.S. priority.

ROMANS: But a Rose Garden news conference, President Trump blamed the attack on Assad, condemning it as heinous and he hinted the U.S. might take action against Assad.

(BEGIN VIDEO CLIP)

DONALD TRUMP, UNITED STATES PRESIDENT: My attitude toward Syria and Assad has changed very much. I will tell you that attack on children yesterday had a big impact on me. Big impact. That was a horrible, horrible thing. And I've been watching it and seeing it, and it doesn't get any worse than that. It crossed a lot of lines for me. When you kill innocent children, innocent babies, babies, little babies, that crosses many lines, beyond the red line, many, many lines.

(END VIDEO CLIP)

ROMANS: Many, many line. The President was also asked about an earlier White House statement that blamed the attack in part on President Obama. President Trump said the responsibility is now his, and he will, "carry it very proudly". President Obama's failure to resolve the Syria problem, Mr. Trump said the president said it was a great opportunity missed.

BRIGGS: President (INAUDIBLE) not call out Russia, though, over its military support for the Assad regime, but as U.N. ambassador certain did at the emergency meeting of the Security Council. Ambassador Nikki Haley slammed both the Syrian government and Russia for the chemical weapons attack. At one point, Haley stood up to describe and display graphic pictures of children killed in the attack, and she suggested that the U.S. is open to taking military action against Assad with or without U.N. support.

(BEGIN VIDEO CLIP)

NIKKI HALEY, UNITED STATES AMBASSADOR TO THE UNITED NATIONS: Consistently fails in its duty to act collectively, there are times in the life of states that we are compelled to take our own action. For the sake of the victims, I hope the rest of the council is finally willing to do the same. The world needs to see the use of chemical weapons and the fact that they will not be tolerated.

(END VIDEO CLIP)

ROMANS: More context on President Trump's options in Syria and reaction to the middle - in the Middle East to the president's apparent policy shift. Let's go live to CNN's Muhammad Lila in Istanbul. Muhammad, very different words from this administration just a week ago when the position was, you know, the future of Syria and the future of Bashar al-Assad lies with the -- rests with the Syrian people.

MUHAMMAD LILA, CNN INTERNATIONAL CORRESPONDENT: Well, good morning, Christine. And, yes, what a difference just a few days make, of course, this major, major tragedy shaking the world's conscience, giving the rebels in the opposition a little bit of momentum here because this is something that they wanted the world to take note for a long time. But, there is a bit of breaking news here in this region, Christine, that we can report. Just moments ago, a senior Turkish official, government official announced that they had conducted autopsies on three of the bodies that have been recovered from this suspected chemical weapons attack site. The autopsies, they say, were observed by the World Health Organization and another monitoring body called the Organisation for the Prohibition of Chemical Weapons.

[04:34:58] They said the autopsy process was transparent and what the autopsy show was that, yes, there were chemical weapons on the bodies of those people that were recovered. Now, of course, a full report is going to be released later today, but that may put an end to the debate on whether or not this was actually a chemical weapon.

And, of course, you have Russia and Syria saying that while there was a chemical weapon, it wasn't fired by them, and it was in a rebel ammunition depot that was struck, and as a result, that chemical weapon was released into the air. But, of course, the big wildcard in this now, is that President Trump has come out and said that this affected him very much. What the rebel groups are hoping on the ground to see is that that will translate into some sort of coherent American policy, something that, you know, condemnation and simply saying, "Well, we condemn it. We're against it." That doesn't do a lot because innocent people are still dying on the ground. So, I think the next step that the opposition wants to see is whether or not this will actually lead to any sort of meaningful action in Syria to prevent more people - more innocent people from losing their lives. Christine?

ROMANS: Right. We should point out, Muhammad, there have been seven years of horrific images of Syrian children drowned, killed - you know, it is an awful -- now the President finds it horrendous and said that has changed his mind. Muhammad Lila, thank you so much for that.

BRIGGS: As for Russia, will the Kremlin heed the warnings from U.N. Ambassador Nikki Haley? Let's bring in Matthew Chance live from Moscow. Matthew, Haley said "How many more children have to die before Russia cares?" Is there an answer from Moscow?

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, there hasn't been one, yet, except to say that the Russian foreign ministry has tweeted to me this morning, who texted me this morning saying that they regard the Bashar al-Assad as the legitimate president of an independent country, and that's not going to change. And that is following comments from Rex Tillerson, U.S. Secretary of State, calling on Russia to review its support of Bashar al-Assad.

I mean, look, I mean, whatever the foreign policy is going to be of the Trump administration moving forward, when it comes to Syria, these are some of the strongest words of criticism we've heard from Trump appointed officials since his inauguration back in January. You know, the criticism of Russia; how many children have to die before Russia cares; the words from Rex Tillerson as well criticizing Russia's position. Never heard it from Donald Trump interestingly, he didn't mention Russia when he was criticizing this alleged chemical attack in Syria. But, it has put a huge question mark over this whole idea of a reset.

With Russia, Donald Trump is the candidate, of course, who's saying he wanted to build a better relationship with Russia, but if they're contemplating military action or any kind of unilateral action at inside Syria, that's going to be bring them butting up rights against the Russians who were there in force, of course, inside Syria, and, you know, not to mention the fact, they have one of the most sophisticated anti-aircraft systems operational inside Syria as well. So, that all has to be taken into account as the Trump administration develops its policy towards Syria.

BRIGGS: So, perhaps the United States and Russia on yet another collision course. Matthew Chance live in Moscow for us. Thank you.

Christine, let me mention, The New York Times, when they had this interview with President Trump yesterday, Glenn Thrush asked him again, "What about Russia's role in all of this?" He said, "I think it's very, very disappointing." Nowhere near matching the rhetoric of Nikki Haley or Rex Tillerson, some hint that he's concern about Russia's role, clearly not enough. ROMANS: He called it sad and disappointing right in that New York Times interview. The Syrian attack is not the president's foreign policy priority today. He's also set to host Chinese President Xi Jinping at his Mar-a-Lago estate with North Korea's missile launch and the president's long history of tough talk about China as a backdrop for Xi's visit. For more on what we can expect with this U.S.-China summit, a really, really fascinating and important meeting. I want to bring in CNN's Matt Rivers in Beijing.

And, you know, Matt, for months, this President when he was a candidate, used the crudest terms possible to say what he thought China was doing to the U.S., now these two men will be face-to-faced.

MATT RIVERS, CNN CORRESPONDENT: This will be a very interesting first meeting and what could easily be seen as the most important bilateral relationship in the world. And as you mentioned, there are no shortage of issues for these two men to be discussing. But I think you can expect right at the very top of the agenda, will be North Korea. There is common ground there between the United States and China in that they both view North Korea's weapons development program as a problem. They disagree, though, on the best way to stop it. The United States says China should be using its economic leverage over North Korea to get them to stop developing these weapons. China says the United States needs to be directly negotiating with Pyongyang to do the same thing. How those two countries will or won't work together on that issue could go a long way with determining the future of the Korean Peninsula.

And moving on from there, you also have trade. When the President was talking in the super crude terms as you mentioned there, he was discussing China's trade practices, unfair is what the President called them. And so, will he raise those issues with President Xi? And how will President Xi respond? Could we be looking at a trade war down the road or could we be looking at perhaps some sort of joint investment deal? We're really not sure how this is going to play out, but one interesting photo op that might take place, a Chinese official here in Beijing telling me that both sides are negotiating the possibility of a joint press availability. That's something the Chinese President almost never does. Christine?

[04:40:22] ROMANS: Interesting. That's very interesting. Also, the Chinese President doesn't golf and he's going to a golf resort. So, that's also an interesting backdrop there. Matt Rivers, thanks for that.

BRIGGS: And not staying at Mar-a-Lago, mind you.

For more on what we're learning about North Korea's missile launch and regional implications, let's get to CNN's Paula Hancocks live in Seoul, South Korea. Good morning to you, Paula.

PAULA HANCOCKS, CNN INTERNATIONAL CORRESPONDENT: Hi there, Dave. We'll we are hearing more from U.S. defense officials, and they have changed their initial assessment of this missile from North Korea, saying, they believe now it was a Scud extended range, which used liquid fuel rather than solid fuel, meaning it's not quite so quick to put together into fire, which was obviously a big concern to those in the region. Very interestingly, though, it is a departure from what the South Koreans are saying, there was some disagreement on what kind of missile this was. It's very rare to see that between Seoul and Washington, assuming that they're actually looking at the same satellite imagery, but we do know that U.S. defense officials believe it was a failure.

In fact, we heard from one senior defense official saying, it spun out of control and had a fiery decent into the ocean. Now, that is probably very accurate considering the fact we have not heard North Korea mention this missile. When North Korea has a success, it is talked about, it is announced on state-run media, and it is pointed out immediately that the North Korean Leader Kim Jong-un was involved. We have photos, We have video of him watching a missile launch and looking delighted. We don't have that this time, so it is more than likely that this was a failure. But, of course, officials here, officials there in the states as well still say that they learn something every time they carry out this kind of missile test. Dave?

BRIGGS: Disagreements about what it was but agreement that it was a failure. Paula, thank you.

ROMANS: All right. A surprising move at the National Security Council - excuse me - the President's top strategist is out. What happened? Why it matters? That's next.

(COMMERCIAL BREAK)

[04:46:30] ROMANS: President Trump's biggest target on trade is China. And today, he meets with that country's leader. The president's main issue is this, the trade deficit with China. Look at that. The total U.S. trade deficit, $310 billion of it is with China. That's more than half the total U.S. trade deficit. Nearly five times the deficit with Mexico. So, the president does have a point. America buys way more from China than it sells to China. That puts China in a stronger position. That has allowed China to build up its factory floor, and honestly, take tens of millions of people out of poverty and put them to work. That is the goal of the Chinese administration.

Now, on some levels, there's no question, though, China is not playing fair when it comes to trade. American companies complain that their products are stolen and copied (INAUDIBLE). China, for years, kept its currency cheap to benefit its products over U.S. goods. That cheap currently is why when you go to a store in the United States, it is full of Chinese-made goods and so many factories in this country closed. But is the trade deficit the best way or the only way to measure who's winning or losing? Well, look at it this way. A growing trade deficit could also signal that the U.S. economy is growing and consumers are buying more, or that China is slowing and people there are buying less from the U.S.

The other big hurdle for President Trump will be, of course, his promise to bring jobs back. If the president pressures companies not to import from China, the companies will likely find suppliers elsewhere, like Vietnam or Indonesia. Those markets are becoming more attractive as cost in China rise. Very complicated situation and you wonder with North Korea, with intellectual property, with currency, all of these things on the table when this two meet at Mar-a-Lago today.

BRIGGS: Right, and we have limited leverage and your priority must be North Korea. Can you accomplish anything on trade?

ROMANS: We shall see.

BRIGGS: Oh, boy. It'll be fascinating. President Trump's political guru, Steve Bannon, seeing his sphere of influence at the White House shrink quite considerably, the president removing his chief strategist from the National Security Council. The shake-up amounting to a demotion for Bannon said to be orchestrated by National Security Advisor H.R. McMaster, who also put two people back on the NSC's principals committee. We get more now from CNN's Jeff Zeleny at the White House.

JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Christine and Dave, this foreign policy challenges are testing this Trump presidency, unlike they have in the first 11 weeks in office. There's suddenly a shake-up in the National Security Council. Steve Bannon, the president's chief strategist, who is a part of that principals committee named in the early days of this administration, was suddenly on Wednesday removed from that principals committee. Now, this is saying that General H.R. McMaster, the security -- National Security Advisor here at the White House is exerting his influence. Steve Bannon, taken off that principals committee and two other people, put back on, returning back to the traditional structure here of the National Security Council. Then goes the Director of National Intelligence and General Joseph Dunford, the chairman of the Joint Chiefs of Staff are returning to the principals committee of the National Security Council, Steve Bannon stepping aside here.

Now, this again, is a -- seen as a major shake-up because Steve Bannon, largely one of the most influential advisors inside this White House with a portfolio spanning from domestic affairs to foreign policy, will still be involved, of course, but by not having a seat at the table, which was very unusual at the time. It certainly is giving more power to the National Security Advisor, H.R. McMaster. So, a bit of inside baseball staff changing here, but so significant that Steve Bannon, we are told, having a more diminished role now, and the new National Security Advisor empowered again. Christine and Dave?

[04:50:06] ROMAN: Wow, OK. Jeff Zeleny, thanks for that. Now, Bannon is not, of course, completely out of the mix. A senior administration official tells CNN, Bannon did attend the National Security Council meeting last night, but a new power center is emerging at the White House with Chief Economic Advisor, Gary Cohn, and Deputy National Security Advisor, Dina Powell, considered internal allies of Trump son-in-law and advisor, Jared Kushner.

The New York Times reports Bannon discussed quitting over his removal from the NSC. The official we spoke to heard nothing about that. And just the fact of all of that chatter tells you exactly how much interest there is in every one of these power moves inside the White House.

BRIGGS: And what does it say about, perhaps, a shifting global view for President Trump? We don't know but we certainly (INAUDIBLE)

(CROSSTALK)

ROMANS: Well, they call -- I mean, Gary Cohn is known as "Global Gary", so --

BRIGGS: There you go. We shall see. Congressman Adam Schiff, ranking member on the House Intel Committee, says White House aides are fighting a promise the president made to him. Schiff says President Trump promised to turn over documents, Intel Chairman Devin Nunes showed the president last month. But he says White House staffers are resisting the release. Schiff himself has seen the materials but the full Intel Committee has not. Democrats are also accusing republicans of blocking testimony by former acting attorney General Sally Yates. Republicans insist they are working out arrangements for Yates to appear at the hearing.

ROMANS: This week's foreign policy crises is notwithstanding. President Trump tells the New York Times he believes Susan Rice committed a crime by unmasking Trump associates who were incidentally surveilled, and that that's a huge story. The president, again, offering no evidence to support his claim that the former Obama National Security Advisor acted criminally. Here's what he said, quote, "I think it's going to be the biggest story. It's such an important story for our country and the world. It is one of the big stories of our time." The president said he would explain himself further, "at the right time." In response, a spokesperson for Susan Rice telling CNN, quote, "I'm not going to dignify the president's ludicrous charge with a comment."

All right. Pepsi. Remember we talked about that Pepsi ad? We were both (INAUDIBLE).

BRIGGS: The entire flat was talking about this ad.

ROMANS: Well, it's canning but I'm thump. It's controversial ad, but not before the daughter of Martin Luther King, Jr. weighed in on this unfortunate spot. We'll show you her powerful pushback. We get to check on CNNMoney (INAUDIBLE) next.

(COMMERCIAL BREAK)

[04:56:34] BRIGGS: Severe storms spanning at least nine reported tornados across the southeast in Alabama. You can see dozens of homes destroyed, torn apart by the storms, a handful of storm-related injuries reported in the region as well. For the latest on the damage and where those storms are headed, let's get to Meteorologist Pedram Javaheri.

PEDRAM JAVAHERI, CNN WEATHER ANCHOR: Morning, Dave and Christine. Yes, the threats certainly not over with across parts of the southeast, but the large majority of the severe storms have all waned. I noticed some storms left in place generally across parts of Northern Florida, where a tornado watch still in effect until 8:00 in the morning local time. But the big story today is going to be all about the winds, very blustery at times. Gusts could get up to around 45 miles per hour, and of course, the Augusta Nationals, they're getting underway today as well.

So, it certainly could impact some play out there with the winds expected for about 60 million people. They'd be pretty blustery, but the center of the storm system does pushing off towards the northeast, around parts of the (INAUDIBLE), around parts of the Mid-Atlantic there. Some very wet weather expected. Some of these storms could once again be severe, about 15 million people stand to be impacted today with this versus about 50 million people this time yesterday. But we're talking about hail and wind being the main threats, a few shots of an isolated tornado, not out of the question, and what a year it's been for tornados, almost 200 percent above normal. There you see how many of these is the average, how many we've picked up, almost 500 so far in the year.

And in fact, look at this, here's the layout for your state, for the number of tornados we've seen so far reported in 2017. The State of Georgia leads that number with 81 reports of tornados so far in 2017. Guys?

ROMANS: Wow. All right. Pedram, thank you (INAUDIBLE) weather. How about the money this morning? Let's check to see our Money Stream. Dow Futures lower right now, S&P Futures lower as well, stock markets in Europe dropping, shares in Asia closing with loses overnight. The president's meeting with Chinese President Xi has investors on edge but also the Friday jobs report.

Check out the wild day for stocks yesterday. The Dow shot up 200 points at the open yesterday, there was a private report on private sector hiring - or private sector hiring report that was positive - sorry. And then, the average turned negative after the Federal Reserve minutes came out. Those minutes showed some members of the Central Bank feel that stock prices are quite high at that moment. It was that combo that worried investors. Another solid jobs report tomorrow, may give the fed cover to raise interest rates more quickly this year.

Wall Street now has sort of a love-hate relationship with (INAUDIBLE) and the Fed. The low interest rate environment helped boost stocks for years, but then many (INAUDIBLE) fell behind the curve, not moving quickly enough.

All right. Speaking of moving quickly, Pepsi is pulling that ad featuring Kendall Jenner. That ad sparked a whole lot of controversy. In the spot, this model joins a group of protesters and offers a Pepsi to a stoic police officer. A Twitter storm ensued. The people spoke, nobody liked this thing. Pepsi clearly missed the mark and finally apologized for the ad. This is one of the widely shared comparisons on social media. It shows the ad next to a real picture from a police -- a protest against police brutality in Louisiana. The protesters name is Iesha Evans. She stands still as riot police rush in and was later arrested. But this was one of the most powerful takedowns. Bernice King, the daughter of Martin Luther King, Jr. was among those who commented on the tone deaf nature of this ad. She shared a picture of her father, tweeting, "If only daddy would have known about the power #Pepsi."

BRIGGS: I said -

(CROSSTALK)

ROMANS: It sort of feel like every advertising and P.R. class in the country is like watching that thing. Wow.

BRIGGS: The President perhaps needs a can of Pepsi for North Korea, bind you to that logic?

ROMANS: I don't know.

BRIGGS: EARLY START continue -

END