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EARLY START

Outrage After Trump Fires FBI Director; NASDAQ Hits 30th Record Close in 2017. Aired 4:30-5a ET

Aired May 10, 2017 - 04:30   ET

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


(COMMERCIAL BREAK)

[04:30:43] ANNOUNCER: This is CNN breaking news.

DAVE BRIGGS, CNN ANCHOR: A truly stunning development rocking the foundation of American government, President Trump firing the FBI director investigating Russia's ties to Trump's aides. This morning, demands for a special prosecutor amid growing doubts over this investigation.

Welcome back to EARLY START, everybody, on an extraordinary morning in this nation. I'm Dave Briggs.

CHRISTINE ROMANS, CNN ANCHOR: It really is. I'm Christine Romans. It is 31 minute past the hour.

So, this morning was James Comey fired as FBI director for the handling of the Clinton e-mail investigation as the White House claims, or something else? The reality for the bureau and White House is this. The Russia probe is alive without anyone to lead it and the president of the United States is taking serious heat from both sides of the aisle for a move that stunned the nation and among them raises serious questions about why this move came at this time.

BRIGGS: Democratic calls for a special prosecutor on the Russia probe are growing louder this morning. House Democrats now asking for the preservation of all documents related to Russia and to Comey's firing. The FBI director unceremonious termination with eerie echoes, some say, of Watergate, went down rapidly and under tight secrecy.

ROMANS: The president acting on advice from Attorney General Jeff Sessions and Deputy Attorney General Rod Rosenstein who cited Comey's handling of the Hillary Clinton e-mail probe not once mentioning Russia.

Trump, on the other hand, clearly had Russia on his mind when he penned an abrupt letter to tell Comey he was out of a job. But Comey actually learned of his own termination from TV monitors in the FBI office in L.A.

Our coverage begins this morning with Jeff Zeleny at the White House.

(BEGIN VIDEOTAPE) JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Christine and Dave, the White House will be waking up today to the bombshell that President Trump delivered by firing FBI Director James Comey late Tuesday night. It is something that the White House under estimated the fallout of. The White House top officials worked throughout the night trying to reshape the narrative here that frankly got away from them in the firing of the FBI director.

Now, the letter, the very brief letter that the president sent to the FBI director thanked Director Comey for his service but also had some very unusual language. Let's take a look at that.

It said this: While I greatly appreciate you informing me on three separate occasions that I'm not under investigation, I nevertheless concur with the judgment of the Department of Justice that you're not able to effectively lead the bureau.

So, essentially in that one paragraph there, President Trump, all but confirmed that Russia was on his mind, that the Russia investigation that the FBI is leading was on his mind.

Now, going forward here, the president did not speak about this on Tuesday evening. White House officials tell me he has no plans to address it today at the White House. We'll see if that actually happens or not.

But the fallout on Capitol Hill and across this town is swift. Republicans joining Democrats in their criticism of this. Yes, many of them on both sides had deep questions about the FBI's handling of the election last year, particularly the e-mail server of the Clinton campaign of Hillary Clinton. But Republicans on Capitol Hill also have deep questions about the timing of this firing.

The White House acknowledging it did not do, you know, a good enough job explaining it, were caught flat footed a bit. So, today, here at the White House no doubt more questions about this as the firing of James Comey, the FBI director enters its second day here -- Christine and Dave.

(END VIDEOTAPE)

BRIGGS: Jeff Zeleny, thank you. Source with knowledge of the president's decision to fire Comey tells CNN the move was being considered for days. One final straw, we're told, errors in the FBI director's recent testimony to Congress, leading the president to conclude he lost all credibility.

It should be noted the FBI clarified Comey's testimony hours before he was fired.

ROMANS: All right. And so, enormous backlash for the White House here. CNN has learned senior administration officials did not think Comey's dismissal would trigger such a reaction since they officially terminated him for his one fair treatment of Hillary Clinton.

Listen to CNN's Anderson Cooper questioning Trump's spokeswoman Kellyanne Conway about the timing of this firing.

(BEGIN VIDEO CLIP)

[04:35:00]ANDERSON COOPER, CNN HOST: You don't think it looks odd at all that the president of the United States is firing the guy who is leading the investigation into the president's White House and the people around the president?

KELLYANNE CONWAY, WHITE HOUSE COUNSELOR: Well, let me repeat that the president has been told by FBI director that he's not under investigation. That's right in the president's letter.

COOPER: Clearly, this White House is under investigation, the people around the president. The people around the president are under investigation. You would agree with that. Yes?

CONWAY: No, I don't. I know that you -- I know that some are obsessed --

COOPER: James Comey said there's an ongoing investigation.

CONWAY: The president is not under investigation. I'm around the president. I'm not under investigation. I can name many people in that same situation. But I know everybody wants to --

COOPER: You're saying there's no investigation by the FBI that's ongoing right now into the people around the United States?

CONWAY: I'm saying that -- well, I don't know that. But I'm saying that to the extent that any of that is true, the president himself -- excuse me -- is not subject to investigation. And most importantly, are you talking about the folks who are involved in the campaign?

COOPER: Yes.

CONWAY: You said the people around the president. People who were --

COOPER: Some of them may still be around the president. I don't know exactly who is being investigated. There was an ongoing investigation by the FBI.

(CROSSTALK)

CONWAY: -- Donald Trump. But again, you want this to be about Russia when this is about, quote, restoring confidence and integrity at the FBI.

COOPER: You want this to be about restoring confidence in the FBI.

CONWAY: No, I'm just reading --

COOPER: Many people believe this doesn't restore confidence in the FBI. In fact, a lot of people are raising questions about it destroys people's confidence in the FBI, that whoever the president appoints will now be in charge of an investigation into people who have been close to the president during the campaign. Any potential collusion with Russia.

CONWAY: And today's actions had zero to do with that.

(END VIDEO CLIP)

ROMANS: The president three times in his letter mentioned the Russian investigation.

BRIGGS: Just interesting to see Kellyanne Conway out front on this. We haven't seen her much in recent weeks. And then you add to that today, it's Sarah Huckabee Sanders who will do the press briefing at the White House, not Sean Spicer. He had a previous commitment. So, different voices at the most pivotal time for the Trump White House.

Meanwhile, Deputy FBI Director Andrew McCabe is now the acting director of the FBI. Interestingly, he's also under investigation. The Justice Department's inspector general is looking at whether McCabe should have recused from certain aspects of the Clinton email investigation.

ROMANS: All right. On Capitol Hill Comey's firing was met with shock across the political spectrum. Republicans expressing a range of concerns, many of them focused on the timing of dismissal, months into Trump's term and nearly a year after Comey's news conference on the Clinton emails.

Tennessee Senator Bob Corker saying in a statement saying his removal at this particular time will raise questions.

BRIGGS: Senator Flake of Arizona tweeting, I spent the last several hours trying to find an acceptable rationale for the timing of Comey's firing. I just can't do it.

Fellow Arizona Republican John McCain says he's disappointed in the president's decision. And that marks a rare break from McCain with South Carolina Lindsey Graham who did voice support for the move.

ROMANS: On the other side of the aisle, Democrats largely unified in their calls now for a special prosecutor. Here was Senate Minority Leader Chuck Schumer.

(BGIN VIDEO CLIP)

SEN. CHUCK SCHUMER (D-NY), SENATE MINORITY LEADER: This investigation must be run as far away as possible from this White House and as far away as possible from anyone that President Trump has appointed.

(END VIDEO CLIP)

ROMANS: President Trump ready to fire right back on Twitter. Crying Chuck Schumer stated recently, I do not have confidence in him, James Comey, any longer. Then acts so indignant. #draintheswamp.

That is the only reaction from President Trump besides the letter that he issued firing Comey.

With more reaction this morning from Capitol Hill, let's bring in CNN's Phil Mattingly.

(BEGIN VIDEOTAPE)

PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT: Now, Christine and Dave, two words that were uttered most by both Republicans and Democrats in the wake of that stunning firing of FBI Director James Comey was shock and surprise. With the exception of top congressional leaders, the vast majority of lawmakers on Capitol Hill simply weren't informed.

According to several Senate GOP aides I spoke to, they didn't know how to respond. They were calling office to office, trying to unify their statement. Was it a good thing? Was it a bad thing? Was it necessary?

At least in the near term, they weren't totally sure. Now, when those statements started to roll out, these are a very constant theme from Democrats. This, more than anything else, underscores the need for either an independent prosecutor or an independent commission.

Now, Republicans, they're a little bit more varied. Some like Senator Lindsey Graham saying they supported the decision. It was necessary for FBI to move on, necessary for new leadership to come in to play.

But others not so aligned with the Trump White House, including one in particular, Senator Richard Burr. He's the top Republican on the Senate Intelligence Committee.

[04:40:00] He put out a statement saying he's, quote, trouble by timing and reasoning of Director Comey's termination. Now, he's overseeing the Senate investigation into Russian meddling in the 2016 election and he's mostly stayed away from any types of political statements.

Now, also, take a listen to what the vice chairman of that committee had to say, Democrat from Virginia, Mark Warner.

SEN. MARK WARNER (D), VIRGINIA: Shocked would be a gross understatement. I mean, this was -- didn't see this coming. It's obviously outrageous. What happened during the Nixon period, there were people of principle who stood up against some of then-President Nixon's actions.

I'm hoping in the coming days that we'll see either out of administration, and, frankly, from a lot of my colleagues, a willingness to rise above partisanship because this is so much more important than this president. It's really about the whole rule of law in our country.

MATTINGLY: Now, it's worth noting, guys, the House of Representatives isn't even in session. Some lawmakers back home on recess, about to walk in to town halls from this (INAUDIBLE). Others out of the country, staffers trying to scramble to brief their bosses, let alone get a statement from them.

What this all under scores is this happened quickly, this happened quietly. Capitol Hill, who certainly for the most part not in the loop on this really dramatic night, dramatic happening, dramatic occurrence. You can bet senators that are in town and House members when they come back next week, they'll have plenty to say about this development -- Christine and Dave.

(END VIDEOTAPE)

BRIGGS: Phil, thank you. Certainly, everyone will be pressed to have an opinion on this.

Meanwhile, senior Justice Department and FBI officials telling CNN Comey's firing came as a complete shock to them. They tell us tensions have been escalating in recent months between the two agencies with justice officials telling -- questioning Comey's handling of the Clinton investigation and his overall management of the bureau.

We're told more changes at the FBI could be in the works. We're also told friction was building between the White House and FBI over persistent leaks and how aggressively the FBI was or was not trying to stop them.

ROMANS: The bureau was notified of Comey's dismissal by Attorney General Jeff Sessions. And it was Sessions who penned a letter to the president recommending Comey be fired. That has many critics wondering if the attorney general has really recused himself from the investigation into the Trump campaign's ties to Russia.

Hillary Clinton's former running mate, Senator Tim Kaine, tweeting, Comey firing recommended by Sessions. I thought he had recused himself from Russia investigation.

BRIGGS: They're just one of the many contradictions of this firing.

Hours before Comey's stunning dismissal, White House spokesman Sean Spicer gave no hint of what was about to go down. Looking back at Tuesday's press briefing, Spicer seemed to speak volumes by saying nothing.

(BEGIN VIDEO CLIP)

REPORTER: Does the president still have confidence, full confidence in FBI director James Comey?

SEAN SPICER, WHITE HOUSE PRESS SECRETARY: I have no reason to believe -- I didn't ask him. So, I don't -- I have not asked the president since the last time we spoke about this.

REPORTER: And the last time you spoke about it, you said he did have confidence but you're not sure to say that again now?

SPICER: Well, I don't -- in light of what you're telling me, I don't want to speak on behalf of the president without speaking to him first.

(END VIDEO CLIP) BRIGGS: Now, Spicer won't be at the podium for the rest of the week. Deputy Press Secretary Sarah Huckabee Sanders will handle today's on camera briefing with the White House press corps, while Spicer fulfills his Navy Reservist duty at the Pentagon.

The White House communications director says the changes were previously scheduled.

ROMANS: All right. Soon after word broke of Comey's firing, CNN learned federal prosecutors had issued grand jury subpoenas to associates of former national security Michael Flynn. The move signals a significant escalation in the FBI's Russia investigation.

The subpoenas seek business records from colleagues who worked with Flynn after he was forced out of the Defense Intelligence Agency in 2014. That when Flynn received payment from foreign governments including Russia. Attorneys for Flynn declining to comment.

All right. A group of some unique insight into the Russia mess, the Clinton campaign. And they've got big concerns about the way all this is going down.

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(BEGIN VIDEO CLIP)

[04:48:06] JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: James Comey was fired for being too mean to Hillary Clinton? Does anyone believe that? Could anyone believe that?

This is an investigator who is investigating the White House. And he was just fired by the White House. This doesn't happen in the United States.

(END VIDEO CLIP)

ROMANS: This doesn't happen in the United States, except way back in the 1970s. They are calling it Nixonian when the president of the United States fired special prosecutor looking into Watergate.

This is just one example of outrage to that Comey firing. We're hearing from Clinton campaign aides responding to the stunning news with suspicion not satisfaction.

Campaign manager Robby Mook tweeting this: Twilight zone. I was as disappointed and frustrated as anyone at how the e-mail investigation was handled, but this terrifies me.

BRIGGS: And Clinton's former Press Secretary Brian Fallon weighing in on CNN last night as well.

(BEGIN VIDEO CLIP)

BRIAN FALLON, FORMER HILLARY CLINTON PRESS SECRETARY (through telephone): The timing and nature of this firing that the Trump administration is announcing now belies any explanation that this has anything to do with the Clinton investigation. The only thing I think could have further deteriorated confidence and eroded faith in the institution of the FBI than Jim Comey remaining there was firing Jim Comey, and now, Donald Trump has gone and done that.

(END VIDEO CLIP)

BRIGGS: Then there's John Podesta who chaired Hillary Clinton's campaign, echoing the words Democrats who called Comey's firing Nixonian.

Podesta tweeting, @Trump, didn't you know you're supposed to wait until Saturday night to massacre people investigating you?

Reference is to President Nixon Saturday night massacre when Nixon ordered the firing of Watergate special prosecutor Archibald Cox which led to resignations of the attorney general and deputy attorney general.

ROMANS: All right. This morning a range of other former officials with insight pushing back against the Comey firing.

Former U.S. attorney Preet Bharara, the federal prosecutor in New York, who also was fired by the president after being told initially he was staying on.

[04:50:04] He tweeted this: Everyone who cares about independence and rule of law in America should be troubled by the timing and the reasoning of Comey firing. Period.

BRIGGS: Former Obama administration officials also firing up their Twitter feeds.

Former Attorney General Eric Holder writing: To the career men and women at DOJ/FBI, you know what the job entails and how to do it. Be strong and unafraid. Duty, honor, country.

Here's former presidential adviser Dan Pfeiffer, who is now a CNN contributor, quote, Trump just fired the man who was investigating his campaign's possible ties to Russian interference in the election. Nothing to see here.

ROMANS: And this from Jen Psaki, the former White House communications director who is also now a CNN contributor: This should not be sugarcoated. Firing Comey is up there in terms of the scariest things Trump has done.

We'll share more thoughts and reaction throughout the morning.

BRIGGS: But we must point out that these Democrats, these people with Clinton and Obama ties are not disputing what Rod Rosenstein wrote in his letter. They're not disputing that he mishandled, James Comey, the Clinton e-mail investigation. They are certainly questioning the timing and the motives and the reasoning of why now. We should be clear about all that.

Meanwhile, with Director Comey out? Where does the investigation into Russian meddling in U.S. elections stand right now? Well, all decisions about appointing independent counsel to investigate particular cases now rests with Deputy Attorney General Rod Rosenstein. That's because Attorney General Jeff Sessions, a Trump campaign surrogate and adviser, recused himself on matters related to Trump and Russia. Congress could percent a bill creating a new office of independent counsel, as it did in 1978. That law expired in 1999.

ROMANS: In between the statute was used a dozen times, most famously to launch the Ken Starr probe of President Clinton. President Trump could veto such a bill, though, which would have to be overridden by two thirds of the House and Senate. Bill Clinton signed a re- authorization of the original law in 1994 with several alleged scandals brewing.

BRIGGS: If the president is looking to ease concerns about his campaign's ties to Russia today's meeting with Russian Foreign Minister Sergey Lavrov may not help in that capacity. The White House confirming the sit down in the oval office later this morning after Lavrov meets with Secretary of State Rex Tillerson. They are expected to cover a wide range of issues including Syria and Ukraine. It will be the highest level of meetings between the U.S. and Russia since President Trump took office.

We should note that we have not seen the president in recent days. No public events in five days. This will be day six. This Lavrov meeting was previously planned. But recently, the timing here strange to say the least.

ROMANS: It's curious. And, you know, Sean Spicer yesterday said the president has been preparing for his big upcoming international trip. So, he's been hunkered down with his aides and with his national security adviser. And today, he will meet with Sergey Lavrov.

BRIGGS: If he doesn't speak publicly about this firing, you wonder how that foreign trip goes. Saudi Arabia. The Vatican.

ROMANS: Tweets at 10:00 last night, crying Chuck Schumer.

BRIGGS: I think American people deserve an explanation.

ROMANS: I would say.

Lawmakers want to investigate a noted investor, the president's special adviser Carl Icahn. We'll tell you why on CNN Money Stream, next.

(COMMERCIAL BREAK)

ROMANS: All right. It's that time of the hour. Let's get a check on CNN Money Stream this morning. Futures in global markets mostly lower. You can them there. Turning lower after Wall Street once again barely moved.

Still, yesterday was enough for the NASDAQ to hit another record high close, 30th this year. Dow and S&P closed lower. Energy stocks dragging them down as oil fell one percent. More earnings on deck today and a really strong earning season. Companies have been making a lot of money. However, Disney shares down 2 percent after revenue there came up short.

Yelp plummeting over 20 percent. Erases an entire year of stock gains. Weak advertising sales disappointed Wall Street. The company struggling to raise ad revenue because of stiff competition from Google and Trip Advisor.

All right. Activists billionaire investor and Trump friend and adviser Carl Icahn may have broken securities trading laws. That's what Democratic lawmakers want to investigate. They want the SEC to investigate it.

It has to do with CVR Energy, a small oil refinery Icahn has a majority stake in. The company bet against something called biofuels credit. EPA regulations require refiner refineries to buy them. And prices for those credits plummeted after Icahn and a trade group presented the White House with a plan to revamp those EPA regulations.

Lawmakers argue -- these Democratic lawmakers argue resulting profits could be insider trading. Icahn did not immediately respond our request for a comment.

Former Starbucks CEO Howard Schultz has high hopes for the 2017 graduating class.

(BEGIN VIDEO CLIP)

HOWARD SCHULTZ, FORMER STARBUCKS CEO: You can innovate, create and lead. Your generation will transform our economy and create millions of new jobs.

(END VIDEO CLIP)

ROMANS: Fantastic. Millennials are going to save us.

No stranger to speaking out about social issues, Schultz also told students at the Arizona State University they will develop cleaner energy and end racism. Starbucks launched a program in 2014 that covers online tuition at ASU. So interesting so many commencement speakers staying clear of politics. It's interesting time. Everyone trying to scrub politics out of their speeches.

BRIGGS: Hard to do these days.

ROMANS: Yes.

BRIGGS: Speaking of our continued coverage of the firing of FBI Director James Comey continues right now.

(MUSIC)

ANNOUNCER: This is CNN breaking news.

BRIGGS: And that breaking news the bedrock of our democracy under siege. The FBI director investigating links between Russia and aides to the president fired by the president.