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Republicans Delay on Health Care; Merck, Mondelez Victims of Global Cyberattack; Trump Administration's Warning to Syria. Aired 4- 4:30a ET

Aired June 28, 2017 - 04:00   ET



[04:00:09] SEN. MITCH MCCONNELL (R-KY), MAJORITY LEADER: It's a big, complicated subject. We got a lot of discussions going on and we're still optimistic we're going to get there.


ALISON KOSIK, CNN ANCHOR: The evolving Republican strategy to pass a health care bill takes another turn. GOP Senate leaders are working on big changes after calling off a vote. Can they strike a balance to find enough support to get the bill through?

Good morning and welcome to EARLY START. I'm Alison Kosik, sitting in for Christine Romans.

DAVE BRIGGS, CNN ANCHOR: It's going to be a heavy lift getting this through bill.

I'm Dave Briggs. It's Wednesday, June 28th, 4:00 a.m. in the East.

And a new game plan on health care for Senate Republicans. One, postpone a vote on a bill to repeal and replace Obamacare. Two, instead, try and hammer out a new version by the end of this week that will somehow satisfy both moderates and conservatives. Three, send lawmakers home for the July 4th recess where they can mold the details which also gives many of them a chance to hear from angry voters. Not exactly part of the plan, though.

KOSIK: This comes after Senate Majority Leader Mitch McConnell bowed to mounting opposition in his own party, forcing him to delay a vote until after the recess. Senators would now vote when they return to Washington the week of July 10th.

After McConnell announced the delay, President Trump hosted Republicans for a frank discussion at the White House. More on that in a moment.

BRIGGS: Despite the holdup, don't assume the Senate bill is dead yet. After all, the House did manage to pull back from the brink to rally and pass their health care bill in May. So, what will it take to rescue this bill?

Phil Mattingly begins our coverage from Capitol Hill. (BEGIN VIDEOTAPE)

PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT: Well, Alison and Dave, it was what Senate Majority Leader Mitch McConnell didn't want, having no vote on this week. This was the week they targeted. This was the week they thought they needed to get health care done.

This is the week they will not be getting health care done. For one simple reality, they don't have the votes. The votes aren't there yet and because of that they will be postponing.

Now, what does that mean going forward? Well, this is what the majority leader had to say.

MCCONNELL: We're continuing to work on reaching an agreement that will involve continuing discussion to the end of the week and we'll not be turning to the bill on the floor of the Senate until a couple of weeks after.

I think everybody around the table is interested in getting to yes, interested in getting an outcome, because we know the status quo is simply unacceptable. It's a very complicated subject. I had hoped as you know that we could have gotten to the floor this week, but we're not quite there. But I think we've got a really good chance of getting there.

MATTINGLY: Now, guys, the outstanding issues here aren't a secret. Majority leader, he knows exactly where his members are, all 52 of them. He knows what the Medicaid expansion state senators need to come on board. He knows what conservatives want on the regulatory side of things for them to come on board.

The real question is, how do you balance those competing demands? How do you thread a needle that up to this point, they simply haven't been able to thread? It's an open question that senators at least hope to answer in the days ahead. I'm told that several senators are going to be staying in town, going to try and hammer out these details, before they actually leave for recess, getting the CBO score, have an opportunity to really digest things before they come back to the Capitol for a possible vote.

But the reality is, and this has been stated by several Republican senators -- this doesn't become easier with time. This doesn't become easier with time. These divisions, internal divisions, ideological divides, those don't get any easier just because a couple of days have passed.

So, there's still a lot of work to do. Senate Majority Leader Mitch McConnell making very clear, he's giving his members an opportunity and the space to get to yes. The question is, will they get there? Dave and Alison?


KOSIK: Phil Mattingly, that is the question. All right. President Trump himself is trying to get Republicans

across the finish line on this. Take for example this tweet: I just finished a great meeting with the Republican senators concerning health care. They really want to get it right like Ocare, referring to Obamacare or the Affordable Care Act.

BRIGGS: Afterward, several senators called the White House meeting positive, constructive and not tense. We're told many senators aired their concerns about different parts of the bill.

CNN's Jeff Zeleny has more on that from the White House.


JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Dave and Alison, it's back to the drawing board in some respect for Republican senators on the health care bill. President Trump on Tuesday summoned all Republican senators here to White House to get them all in one room, the East Room of the White House, to hear their concerns.

I'm told by senators it was a venting session, a listening session, but President Trump made clear not passing anything is simply not an option.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We're getting close, but for the country, we have to have health care. And it can't be Obamacare which is melting down. The other side is saying all sorts of things before they even knew what the bill was.

This will be great if we get it done. And if we don't get it done, it's just going to be something that we're not going to like, and that's OK and I understand that very well.

[04:05:06] ZELENY: I talked to one Republican in the room who said, I think we'll get there, but who will vote for it, how we'll do it, we're not sure right now.

But don't forget, even if it passes the Senate, it still has to be recycled with the House version of the bill. Now, we are talking some point in July, perhaps late July before this top Republican priority may get through -- Dave and Alison.


KOSIK: Jeff Zeleny, thanks very much.

Also at that White House meeting, several senators making it clear a pro-Trump group has not been helping matters by running ads against the senator who opposes the current health care bill. The ads by the group America First have been slamming embattled moderate Dean Heller of Nevada. A source telling CNN that President Trump got the message and claimed he didn't know about the ads. America First says it's now pulled the ads because Heller decided to come back to the table.

BRIGGS: The ads angered Majority Leader Mitch McConnell, so much so, as source says, he called White House Chief of Staff Reince Priebus to complain, although technically, legally speaking, Priebus has no say in them. A source says McConnell called Priebus because he thought the ads were stupid, counterproductive, and because McConnell feels he has to protect his members whether he agrees with them or not.

KOSIK: Hillary Clinton's campaign chairman John Podesta defending former President Obama's response to Russian hacking in the 2016 election. Podesta spoke yesterday behind closed doors to the House Intelligence Committee investigating Russia interference. He later told reporters Obama tried to make the best judgment on behalf of the America people.

It comes after "The Washington Post" reported on the Obama administration's struggle to find the appropriate response to Russian meddling.

BRIGGS: Meantime, the House Intel Committee will hear from long time Trump associate Roger Stone in closed session next month. Stone had asked for a public hearing but says it's more important to resolve the question of Trump campaign collusion with Russia which he believes was nonexistent. Stone has defended his contact with the online persona who claims responsibility for hacking the Democratic National Committee.

KOSIK: Utah Congressman Jason Chaffetz is dropping a proposal that's raising some eyebrows. Chaffetz is calling for members of Congress to receive a $2,500 a month housing allowance to ease the cost of living for lawmakers in Washington. He says dozens of members, himself included, are living out of their offices, granted Washington is expensive. But rank and file members of Congress, they receive a yearly salary of $174,000. It's $193,000 for those in leadership positions like Chaffetz.

And according to the latest numbers from the Center for Responsive Politics, the median net worth of a member of Congress in 2004 was about $1.1 million. Now, if this ever happens, Chaffetz won't benefit. His suggestion comes just days before he resigns from Congress. So, it's easy for him to make this proposal because this is a politically sensitive topic when you see the government making budget cuts and then you --

BRIGGS: Right, right.

KOSIK: -- see congressmen who have a net worth of more than a million dollars. It's all about --

BRIGGS: But they're not all wealthy.


BRIGGS: This is not a smart time to float that idea. But, look, 40 plus members of Congress are living out of their office, showering, sleeping. If it weren't for the gym, they wouldn't have a shower. Maybe for another time.

KOSIK: And these are number from 2014 that we gave you.

BRIGGS: Right, right.

KOSIK: And I know that it's been many, many years that Congress has actually frozen its salary.


KOSIK: So this is a stipend that Chaffetz is calling for.

BRIGGS: We'll hear it a few years down the road.

All right. Ahead, it's only been a month since the WannaCry virus hit computers in 150 countries, but cyber attacks once again are wreaking havoc across the globe. We'll tell you who is affected and who could be behind it, next.


[04:13:07] KOSIK: It's only been a month since the WannaCry virus hit computers in 150 countries. Now, another big malware attack is wrecking havoc across Russia, Europe and the U.S. It's targeting government agencies and global firms, including companies like Merck, Mondelez, WPP and Russian oil giant Rosneft. Ukrainian firms and agencies have been hit particularly hard, including the monitoring system at the Chernobyl nuclear power plant.

This virus dubbed Petya similar to WannaCry ransomware. It infects and locks a computer. Then, it demands $300 in bitcoins to open it up. Petya also spreads through a similar flaw in Microsoft Windows. Microsoft released a security patch in March. However, the virus targets anyone who hasn't updated their system.

We don't know yet the source of the attack, but cybersecurity and law enforcement are investigating. But they advise you shouldn't pay the ransom if you're affected. That only encourages these kinds of attacks. Instead, victims should update their operating systems and backup data now before it's too late.

BRIGGS: For more, let's bring in CNN's Nina dos Santos from London, where several companies were hit.

Nina, what do we know about who might be behind this ransomware attack?


Well, at the moment, the usual suspects have said that they're not behind it. So, obviously, remember that this is an attack that seems to have started in Ukraine. Ukraine quickly pointed the finger towards Russia, but then it seemed as though Rosneft, the giant oil and gas company in Russia, had also been infiltrated.

And so, it seems as though for the moment, we're not quite sure where this particular virus came from.

With WannaCry, for instance, a lot of people in the cybersecurity community thought that that had come from North Korea. That a month after that particular devastating attack, it's still up for debate whether or not the North Koreans were involved in this.

But what really is concerning to people here is the fact that this may not be a one big hack and then it's over, a bit like WannaCry, which was shut down when a kill switch was found 24 hour afterwards.

[04:15:09] This one doesn't seem to have a kill switch for the moment, even if it's using the same exploit inside the Windows operating software that WannaCry was. And then what's also what's more detrimental about it is not just it could particularly spread over a longer period of time, is that it doesn't just lock the files on your computer, it locks down your entire hard drive.

So, say, for instance, if you're Mondelez, the maker of Oreos cookies, or if you're the world's biggest shipping company, WPP, the biggest advertising firm in the world, the big question for their clients will be, how could this have happened if obviously all the companies around the world was supposed to update their software after the WannaCry disaster.

Obviously, some of these companies are ones that weren't struck in the first cyber attack. But we know that these cyber attacks, Dave, are getting more and more common by the day. So, the big question is, why would some of these companies from a reputational point of view not protected? And it will continue to spread, is now spreading to Asia as the trading day is under way there.

BRIGGS: Nina Dos Santos, live for us in London, thanks so much.

Update your software. Samuel Burke always tells us, don't ignore those warnings on your computer.

KOSIK: And keep your passwords in a safe place.

BRIGGS: That too.

KOSIK: We're getting new insight into why the White House warned Syria not to launch another chemical attack. There's hope the Russians can stand in Assad's way. More from the Pentagon, next.


[04:20:54] BRIGGS: In just a few hours, U.S. ambassador to the U.N., Nikki Haley, will testify before the House Foreign Affairs Committee and she's sure to face questions over President Trump's blunt, public warning the Syrian President Assad about ordering another chemical attack. While the statement cuts some off-guard, the White House says top intel and defense officials were part of the process. Now, we're getting a better idea what led to the warning.

CNN's Barbara Starr has more from the Pentagon.


BARBARA STARR, CNN PENTAGON CORRESPONDENT: Dave, Alison, U.S. military officials had been watching this air base in Syria for some days. It was the same airbase that the Syrians used to launch their last chemical attack back in April. But over the last couple of days, they grew concern about what they were seeing there, and what they were seeing was a Syrian aircraft move into a shelter with chemical weapons capability nearby.

So, the obvious concern was, were the Syrians getting ready to launch another chemical attack against civilians?

That is what led to the White House warning that caught a lot of people by surprise. Not top cabinet officials but within the State Department, within the Pentagon, a lot of people didn't know that warning from the White House was coming.

The real goal is to avoid, officials tell us, avoid any additional U.S. airstrikes. What they are hoping is that the Russians will work to influence Assad and get him to back off and not launch another air strike. But if he doesn't back off, if he were to proceed, U.S. military officials are letting it be known they have everything in place to strike again -- Dave, Alison.


KOSIK: OK. Barbara Starr, thanks very much.

And the White House says its warning to the Assad regime was the equivalent of, quote, putting someone on notice.

Let's bring in CNN international diplomatic editor Nic Robertson.

So, Nic, one of the big questions is, you know, can the Russians even influence Assad to prevent another chemical strike and do they even want to?

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: I think definitely we have to say the Russians want to. I mean, the chemical weapons used by Assad and Assad having chemical weapons seems to be an issue that they recognize could trigger massive international involvement in Syria, upset their plans and their strategy for the Middle East. So, this is something in the past they have acted on.

You know, if they look beyond their bellicose language, that we heard from the Kremlin yesterday, that this is unacceptable, this threat on the Assad regime, what actually happened was General Valery Gerasimov, this is Russia's top military strategist and as well as the joint chiefs of staff there, went to Syria, met with Assad and according to the Kremlin discussed the use of, you know, Syrian ground troops and Russian air force. So, a coordination there.

The way that is being framed, if you can look at that language and see that Assad has heard from the top military leadership in Russia, what they expect from him, what they're willing to do.

Now, we also heard from the Kremlin as well as that language pushing back on the White House statement, we also heard them say that they condemn the use of chemical weapons. So, and that conversation between Secretary of State Rex Tillerson and his opposite number, Sergey Lavrov, the Russian foreign minister, on Sunday, that phone conversation we now know included part of the conversation about chemical we tons.

So, we might be looking at a situation here where Russia has blinked because it doesn't want confrontation. And as we heard from Pentagon officials there, there was a real risk cruise missile strikes targeting Assad's forces in Syria may well impact Russian men and military material. And that would mean a further escalation -- Alison.

KOSIK: All right. CNN's Nic Robertson, thanks so much.

BRIGGS: All right. Republicans with a major shift on the health care, a vote this week is out. Instead they'll work on a new plan that can pass the Senate. That's indeed a tall order if you believe key members of the chamber.

[04:25:01] That's next.


SEN. SUSAN COLLINS (R), MAINE: I think the bill would have to be fundamentally changed, and tinkering around the edges is not going to be sufficient to secure my vote. Now, if there's going to be a major rewrite of the bill, then obviously I'm open to taking a look at that.




TRUMP: This will be great if we get it done. And if we don't get it done, it's just going to be something that we're not going to like, and that's OK and I understand that very well.


BRIGGS: President Trump makes his personal pitch to Republican senators to get health care done. It worked in the House. Will it work in the Senate as they try and get a deal done after this week delaying a vote?

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

It is a heavy lift ahead for Senate Republicans.

KOSIK: It certainly will be.


KOSIK: Good morning. I'm Alison Kosik. It's 30 minutes past the hour.

And there's a new game plan on health care for Senate Republicans. One, postpone a vote on a bill to repeal and replace Obamacare.