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EARLY START WITH JOHN BERMAN AND ZORAIDA SAMBOLIN

Raging Southern California Wildfire; Countdown To Forced Spending Cuts; White House: Overturn Prop 8; Jodi Arias Trial; Groupon CEO to Staff: "I Was Fired">

Aired March 1, 2013 - 06:00   ET

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


ZORAIDA SAMBOLIN, CNN ANCHOR: -- lost some of their equipment searching for signs of life. We're going to have a live report from the scene just moments from now.

JOHN BERMAN, CNN ANCHOR: Also happening right now, a ferocious wildfire threatening homes in Southern California. Some 200 firefighters are battling this blaze that has burned through 150 acres in Riverside County, which is east of Los Angeles. Authorities say the smoke and flames have forced evacuations. No injuries have been reported and the cause of the fire right now is under investigation.

SAMBOLIN: And prepare for the slicing and the dicing to begin within the next 18 hours. President Obama is expected to sign an order that triggers $86 billion in forced spending cuts. And once those cuts kick in, expect a slow downward spiral.

So at first, we're likely to see flight delays at airports. We'll see cuts to the hours and services at national parks and forced time off, without pay for nearly 800,000 civilian Pentagon employees. They are called furloughs.

There is a meeting at the White House this morning to deal with the so-called "Sequester," but it appears to be too late to stop that ax from dropping. Here is White House correspondent Brianna Keilar.

(BEGIN VIDEOTAPE)

BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT (voice-over): As President Obama meets at the White House today with Democratic and Republican congressional leaders, the capitol will sit empty.

Congress, the very people who voted for the $85 billion in forced spending cuts set to kick in at midnight, left town Thursday without finding a way to fix the problem and now the finger pointing.

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: The Republican proposal is the worst of all worlds. It is explicitly protects pork barrel projects and every single tax loophole that benefits the wealthy.

KEILAR: President Obama wants to avoid the forced budget cuts in part with tax increases. Republicans refuse.

REPRESENTATIVE JOHN BOEHNER (R), HOUSE SPEAKER: We've done our work. They have not done theirs. The House should not have to pass a third bill to replace "The Sequester" before the Senate passes one.

KEILAR: But the Senate failed to pass two bills Thursday. One Democratic and one Republican, both measures that were never expected to succeed, making it almost certain that President Obama will be forced to sign an executive order today that officially puts the cuts into effect.

They will impact everything from our military, Medicare and education to food inspection and homeland security. President Obama in a written statement accused Senate Republicans of voting, quote, "to let the entire burden of deficit reduction fall squarely on the middle class." Brianna Keilar, CNN, the White House.

(END VIDEOTAPE)

SAMBOLIN: Our thanks to Brianna. In the next half hour of EARLY START, we will talk about the forced spending cuts with Republican Congressman Bill Cassidy of Louisiana.

BERMAN: New this morning overseas, in Japan, two American sailors are now going to prison for a rape they committed while on duty at a U.S. military base in Okinawa. Overnight, a Japanese court sentenced the Navy Seaman Christopher Browning to 10 years and Petty Officer Skyder Dosier Walker to nine years.

Both men admitted committing the crime, which occurred in a parking lot last October. The rape case triggered outrage in Japan and government officials have long complained about U.S. military crime in Okinawa.

SAMBOLIN: It's 3 minutes past the hour. The White House boldly gets into the legal fray over Proposition 8 in California, urging the Supreme Court to overturn the state's ban on same-sex marriage.

In its friend of the court brief, the Obama administration said Proposition 8 violates the constitution's guarantee of equal protection. But the administration didn't go so far as to endorse a constitutional nationwide right to marry.

BERMAN: It is the end of an era in the Catholic Church as anticipation builds for the beginning of the next era.

(BEGIN VIDEO CLIP)

POPE BENEDICT XVI (through translator): I am no longer the pope, but I'm still in the church. I'm just a pilgrim starting the last part of his pilgrimage on this earth.

(END VIDEO CLIP)

BERMAN: With those words and those cheers from the faithful, the first pope in modern history to resign entered retirement. Benedict XVI is spending his first full day out of public life in seclusion at Castel Gandolfo about 15 miles southeast of Vatican City.

Meanwhile, we could be just days away from the beginning of the conclave where cardinals will choose his successor. Our senior international correspondent Ben Wedeman is at Castel Sant'Angelo which is in Rome.

Ben, tell us what happens today and in the upcoming days to prepare for the conclave.

BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPONDENT: It's going to be fairly calm, John, in Vatican City. There's nothing really scheduled until 9:30 a.m. Monday morning when the general congregation of cardinals will begin. That's where all cardinals, not just those who will be participating in the conclave, but those over 80, will get together twice a day for several hours to discuss all of the issues facing the church at the moment.

And of course, the first thing on the agenda for the general congregation will set a date for a conclave. When that happens, of course, the approximately 115 cardinal who's participate in the conclave will be completely secluded, cut off from the world, without cell phones, internet, no access to newspapers, radio, or television. They will vote four times a day, until they finally select a pope -- John.

BERMAN: What are these meetings this weekend mean for the frontrunners, those people we consider the top contenders for the pope?

WEDEMAN: Well, what's going on obviously behind the scenes is a lot of discussions. It's not politicking and sort of the classical sense, but the cardinals will be meeting individually or in small groups, and discussing what they are looking for in a pope.

Now, it's very bad taste, apparently, within the Vatican for any cardinal to actively campaign in any sense, but it's sort of all very low key, very subtle, but they are definitely discussing what sort of pope, not necessarily who that is, that they would like to see succeed Benedict XVI -- John.

BERMAN: A very unique type of politicking indeed. All right, our thanks to Ben Wedeman this morning.

SAMBOLIN: It's 6 minutes past the hour. Now back to that developing story that we're following for you. A swallowed up -- a man swallowed up by a sinkhole that opened up right underneath his bedroom and now that man is presumed dead.

Rob Munoz of our affiliate, WFTS, is live at the scene. This is in Brandon, Florida. What is the very latest there?

ROB MUNOZ, WFTS REPORTER: Well, Zoraida, let me tell you right now. This is a thing of waiting and watching to see what is going on with this home, again this home teetering really on the edge. Let me step out of wait and show this to you. This home could go at any moment.

This hole was about 100 feet in diameter out here. This is not more urgent than for a family member I just spoke with. She is the -- she said the man who is stuck in this hole is her brother's nephew. She said he heard him yelling this morning, yelling for help as the whole was collapsing.

She said it sound like a loud car crash and all she could hear was screams. And before she knew it she got to the room where this man was at, the bedroom and all she said she saw was a mattress and a hole, which black, nothing.

They were digging for this man. They were trying to reach him, trying to reach their family member and right now, she said she is just hoping and praying. She says that she has hope that he is alive.

And telling him right now, if he can hear her that they are saying they are coming for him so again, really just a game of just waiting and watching, Zoraida, really -- and lots of prayers out here really for this family member of theirs.

SAMBOLIN: It's just remarkable. It was absolutely no warning whatsoever for them?

MUNOZ: There was no warning. They said their home was actually inspected last year by the insurance company to make sure there is nothing. And they said they saw nothing. Building code inspectors didn't see anything out here so really unexpected for the entire family.

SAMBOLIN: All right, Rob Munoz, we really appreciate having you out there. We'll continue to check in with you. Thank you.

BERMAN: It's 8 minutes after the hour right now. It is judgment day for the city of Detroit. Michigan Governor Rick Snyder set to rule on the city's troubled finances. He is expected to declare a financial emergency, which paves the way for a possible state takeover.

A state review last week found Detroit was headed for a major financial emergency, billions of dollars in debt. This is going to likely result in the appointment of an emergency manager to handle the city's fiscal affairs.

SAMBOLIN: T-minus 4 hours and counting to this morning's launch of a Space X rocket to the International Space Station. NASA says the unmanned private rocket will deliver some 1,300 pounds of supplies and experiments to the station. It is the second Space X cargo supply mission. The Falcon 9 Rocket and Dragon Capsule are set to lift off from Kennedy Space Center at 10:10 a.m. Eastern Time.

BERMAN: So this has got to be like the ultimate odd couple right now, North Korean dictator Kim Jong-Un and NBA hall of famer, Dennis Rodman. That's right, the two of them together, laughing it up courtside in Pyongyang.

Photos of this summit were published by "Vice" magazine, which is putting the other a new show for HBO, which is our corporate cousin. After the game, Rodman gave a speech to the crowd in which he told Kim, you have a friend for life.

SAMBOLIN: High drama in the courtroom, accused murderer Jodi Arias reduced to tears on the witness stand. It is now her 12th day of testimony. The incredible developments coming up.

(COMMERCIAL BREAK)

BERMAN: Welcome back to EARLY START, everyone. The sensational murder trial of Jodi Arias is back in court Monday in Arizona. It will be her 13th day testifying. Arias is facing a possible death sentence for what prosecutors say is the cold-blooded killing of her lover, Travis Alexander, back in 2008. He was shot twice, stabbed 27 times and had his throat cut. Arias says it was self-defense. More now from CNN's Randi Kaye.

(BEGIN VIDEOTAPE)

RANDI KAYE, CNN CORRESPONDENT (voice-over): Tears from Jodi Arias. She broke down on the stand as the first photo of Travis Alexander's body was displayed in court. It showed him twisted and crumpled on the shower floor.

JUAN MARTINEZ, PROSECUTOR: Ma'am, were you crying when you were shooting him?

JODI ARIAS, ACCUSED OF MURDER: I don't remember.

MARTINEZ: Were you crying when you were stabbing him?

ARIAS: I don't remember.

MARTINEZ: How about when you cut his throat? Where you crying then?

ARIAS: I don't know.

KAYE: With her face in her hands, the prosecutor dared her to look.

MARTINEZ: Take a look then. You were the one that did this, right?

ARIAS: Yes.

MARTINEZ: And you lied about all of this, right?

ARIAS: Yes.

MARTINEZ: So then take a look at it.

KAYE: From the stand, Arias did her best to convince the jury she acted in self-defense. She says Alexander attacked her after she dropped his camera.

ARIAS: He body slammed me.

MARTINEZ: He body slammed you down, right?

ARIAS: Yes.

MARTINEZ: In a forceful way. Where did he body slam you down, ma'am?

ARIAS: Right in the same area, on the tile. KAYE: Even if it was self-defense, how did it lead to this? Nearly 30 stab wounds, his throat cut and a single gunshot to the head. And prosecutors specifically retraced the steps leading up to that point, starting with the moment she said she shot him.

ARIAS: He was running at me as I turned around.

KAYE: Arias alleged Alexander had charged her like a linebacker.

MARTINEZ: Show me the linebacker pose.

ARIAS: He got down --

MARTINEZ: Well, show me -- show me the linebacker pose. That's what I'm asking for you to do.

ARIAS: He went like that and he turned his head.

KAYE: That's when she says the gun went off.

ARIAS: I think I screamed stop when I pointed the gun at him.

MARTINEZ: And then what do you do?

ARIAS: I don't really remember. I just remember -- I don't remember anything at that point, so I would be speculating.

KAYE: Later, the prosecutor displayed several gruesome photos from the crime scene.

MARTINEZ: And according to your versions of events, you would acknowledge that that stabbing was after the shooting, according to you, right?

ARIAS: I don't -- yes, I don't remember.

MARTINEZ: I'm not asking you if you remember, ma'am. I'm asking if you acknowledge that it would be you that did it, correct?

ARIAS: Yes.

KAYE (on camera): No matter what she said on the stand, the state isn't buying her story, and here's why. Investigators believe Arias killed Alexander in the shower. Inside court, the prosecutors showed a clip of her interview with a detective, an attempt to prove that she lured Alexander to the shower just hours after they had sex.

ARIAS: I asked him if I could do pictures of him in the shower, and he was like, no. And I was like, I just had an idea, a couple of ideas, I saw this thing in a Calvin Klein ad once that looks really good. And so he was -- you're right. He wasn't very comfortable at first. He -- he's standing there and he's all, I feel gay.

KAYE (voice-over): Arias snapped naked photos of Alexander, including this one shown in court. Investigators say it's time stamped 5:30 p.m. just two minutes before Arias stabbed him in the heart. MARTINEZ: So you were the person that was directing him on where to be and how to sit, right?

ARIAS: Yes.

KAYE: Directing him, perhaps, to his own death.

MARTINEZ: Do you remember that we're talking about Travis Alexander? Let's start with that.

ARIAS: Yes, I remember that.

MARTINEZ: That's why we're here, because you killed him, right?

ARIAS: Yes.

KAYE: Randi Kaye, CNN, Phoenix, Arizona.

(END VIDEOTAPE)

JOHN BERMAN, CNN ANCHOR: I got to say, just riveting testimony in court, riveting cross-examination case.

ZORAIDA SAMBOLIN, CNN ANCHOR: Details are insane.

BERMAN: Deranged, crazy case this is.

Next hour on "STARTING POINT", we're going to talk with defense attorney Mark Geragos about the Jodi Arias trial.

And tonight, on "A.C. 360", a special report, "Sex, Lies & Audiotape: The Jodi Arias Trial". That is tonight at 10:00 Eastern, right here on CNN.

SAMBOLIN: It is 17 minutes past the hour.

Let's get you up-to-date on this morning's top stories.

Eighty-five billion dollars in forced spending cuts, they are expected to kick in by midnight tonight, once President Obama signs the order. The president meets with leaders of both parties at the White House. That's happening a little later this morning. But a deal before the deadline is absolutely not expected.

BERMAN: President Obama expected to sign an expanded Violence Against Women Act. The Senate version finally passed the House. The measure provides support for organizations that helps domestic violence victims and also stiffens sentences for convicted abusers.

SAMBOLIN: Floodwaters are forcing residents of Valdosta, Georgia, out of their homes. The rain-swollen Cherry Creek has sent water into their homes.

Take a look at those pictures. Those poor folks.

The flooding has overwhelmed the city's wastewater treatment plant, sending millions of gallons of raw sewage into the Withlacoochee River.

BERMAN: What river?

SAMBOLIN: Withlacoochee River, which I supposed the most important is there's raw sewage in there this morning. Terrible.

Some surfers had to get out of the water fast when they discovered they were not alone off the coast of Vancouver's Pacific Rim National Park. They were swimming yards away from a group of killer whales.

BERMAN: Oh my goodness.

SAMBOLIN: Luckily, the surfers were not on the menu. They were chasing a pack of sea lions. That's what they wanted.

BERMAN: Wow.

SAMBOLIN: How cool is that, right?

BERMAN: Not cool at all if you were one of the surfers.

So, the SATs will be getting an update. But we don't know how or when. Board members were sent a letter explaining the re-designed broad goals to mirror the work that students do in college to practice the need they do to complete college. The SATs last revised a decade ago.

SAMBOLIN: He lost his job, but he hasn't lost his sense of humor. The farewell e-mail left by a big boss on his way out the door.

(COMMERCIAL BREAK)

SAMBOLIN: Twenty-two minutes past the hour. Welcome back. Good morning to you. We're minding your business this morning.

Almost, but not quite, the story on Wall Street. The Dow got within 16 points of its record high yesterday, but then it pulled back. Today, things are not looking quite as rosy.

BERMAN: And another big business story. No sugar coating it. Groupon CEO is out. But he's not scared of telling the truth. He was fired.

Christine Romans joins us now from Atlanta today with the details of this, you know, frankly awesome goodbye letter.

Hey, Christine.

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: It so was honest. He's a founder of this company. I mean, he turned down an offer for Google to buy it, so since then, he's been under this pressure, usually when CEO is fired by the board, you get this sort of, we thank him for his service, and he's going to spend more time with his family.

Oh, no. That's not what the Groupon CEO said. This is what he said to employees. "I've decided that I'd like to spend more time with my family, just kidding. I was fired today, if you you're wondering why, you haven't been paying attention. This is what you should have been paying attention to."

Look at the stock chart. This stock chart is basically a resignation warning right there. Groupon stock has been going down since its IPO. You know, don't feel too bad for him for his severance only $30 something, health care for 180 days. But he has 40 million shares of Groupon stock.

So, he's got a couple hundred million dollars. Many say he had the company been run better, he could have a heck of a lot more than that.

SAMBOLIN: He's young. He's good looking. A little fat, though.

ROMANS: In the letter he said something that was so funny. He wanted to --

SAMBOLIN: That's why I mentioned it.

ROMANS: He wanted recommendations for fat camp to lose the Groupon 40.

Look, tech CEOs are a little more, I don't know. They're like fresher and kind of hipper than some of the old stayed CEOs who would say, I'm going to be pursuing other opportunities.

SAMBOLIN: Look, for the record, the man is not fat. I was just kidding around. I wanted to know if you had read that. I thought he was pretty funny when he said that. He needs to lose 40 pounds.

All right. Christine, what is the one thing we need to know about our money today?

ROMANS: The one thing Congress has not screwed up is the housing market.

BERMAN: Yes.

ROMANS: Thirty-year fixed mortgage, 3.5 percent. A slight drop after holding steady for more than a month. You can thank the Federal Reserve for that. Look at the 15 rate, you guys --2.76 percent. That's a popular refinancing tool. That first number you see on your screen.

I'm telling you right now, if there is nothing else you can get your money working for you on, try this. Refinance if you haven't. If you've got a mortgage in the 5 percent or 6 percent range, oh my goodness, go running, running to refinance if you can. Because the money has never been cheaper.

SAMBOLIN: All right. We miss you around. So come back home, OK?

BERMAN: Come back.

ROMANS: I'll be back. I'll be back. I'll be back.

SAMBOLIN: See you later. Thank you.

BERMAN: All right. Twenty-five minutes after the hour right now. And where there is a will, there is a way. Helicopter rescuers forced to get really creative to save animals in deep trouble. You'll see the amazing video coming up.

SAMBOLIN: It may be your favorite story of the day.

(COMMERCIAL BREAK)

SAMBOLIN: Developing right now, a man swept into a sinkhole right under his bedroom. That developing news from the scene is grim at this hour.

BERMAN: The clock ticking down to deep spending cuts. The deadline just hours away. But there are barely any folks left in Washington to stop it.

SAMBOLIN: Plus, big-time Yahoo CEO Marissa Mayer taking major heat after she banned working from home. Wait until you see what other bosses are doing to keep their workers from leaving the office.

Welcome back to EARLY START. Thanks for being with us. I'm Zoraida Sambolin.