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EARLY START

Crisis in Ukraine; Awaiting Putin Statement; Obama's New Budget; Historic Deep Freeze; Blade Runner Murder Trial;

Aired March 4, 2014 - 05:00   ET

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


CHRISTINE ROMANS, CNN ANCHOR: Breaking news overnight. The United States moving to end Russia's armed invasion of Ukraine. Secretary of State John Kerry arriving in Kiev in just hours, threatening severe sanctions if Moscow doesn't pull its military out.

New this morning, the standoff intensifies as Russian troops are on the move.

We're bringing you live team coverage of what's happening and what happened new overnight.

JOHN BERMAN, CNN ANCHOR: All right, news back home. An historic deep freeze moving across the country. Millions waking up to near record low temperatures. It's March, folks, and schools are shut down, roads an icy mess. Indra Petersons is tracking the storm for us.

ROMANS: Happening right now: dramatic testimony against an Olympic hero accused of murdering his model girlfriend. Witnesses taking the stand with tales of blood-curdling screams. We are live.

BERMAN: All right. Good morning, everyone.

Welcome to EARLY START. A lot going on this morning. I'm John Berman.

ROMANS: And I'm Christine Romans. It's Tuesday, March 4th, it's 5:00 a.m. in the East.

BERMAN: And we do begin with breaking news. This deals with the Ukraine crisis.

I should tell you, we are awaiting word from President Vladimir Putin of Russia. He's expected to speak any minute.

Meanwhile, in Ukraine, there's been a tense standoff this morning at a Crimean air base. You're looking at it right here. Russian soldiers firing in the air, as apparently, unarmed Ukrainian troops approached. They were, we think, asking to negotiate.

Armed soldiers are now surrounding security installations throughout Crimea, and warships do remain off the coast. You hear the shouting, obviously, a situation that needs to be calmed down. This is all happening as the White House is planning its next move. The president holding the a late-night meeting as the administration has begun cutting ties with Russia, canceling military exercises and is now said to be planning against some top officials.

Secretary of State Kerry right now on his way to Kiev. You can see him departing from Andrews Air Force Base in Maryland. He will meet with Ukraine's interim government to try to find some way out of this crisis.

Our Diana Magnay is live in Crimea.

Diana, we've been looking at the pictures of the standoff between Ukrainian and, apparently, Russian troops. What's the latest?

DIANA MAGNAY, CNN CORRESPONDENT: Hi, John.

Well, we know from the commander of that military air base at Belbek that the Russians have been making an ultimatum to Ukrainian forces to surrender and they've given them a deadline of 12:00 noon, which is now, and they haven't surrendered.

Now, let me add, these deadlines have come and gone before. Nothing has happened. We were all expecting something at 5:00 a.m. this morning when we heard via one news report that there would be a military storm if the Ukrainian forces in Crimea didn't surrender.

That didn't happen. I'm at a military base. It's fairly quiet, but it would just take one miscalculation and things could escalate and get pretty bad, John.

BERMAN: It's avoiding those miscalculations, that is what is so crucial here.

All right. Diana Magnay for us in Crimea this morning.

Again, we are awaiting word from Russian President Vladimir Putin. That could come at any minute.

ROMANS: Meantime, the Russians claim the president has now ended military drills along the Ukrainian border, ordering those soldiers back to their bases, but Ukraine says it's not true, and they still see troops there.

Phil Black is live in Moscow where Putin is expected to speak at any minute.

Phil, what are you hearing?

PHIL BLACK, CNN INTERNATIONAL CORRESPONDENT: Yes, Russian officials say they're pleased with the results of these combat military -- combat readiness exercises that were ordered by President Putin. He issued these orders after the change of government in Ukraine but before Russian forces started fanning out across Crimea and controlling that region of Ukraine.

These drills, these war games, they were huge, 150,000 soldiers, huge amounts of hardware, including up to 900 tanks, and there were concerns that this could evolve into some sort of large-scale military incursion or even an invasion into Ukraine. But it now seems pretty clear they're being conducted entirely separately to the ongoing military operation in Crimea.

Those drilling forces, they have now been ordered back to barracks, but in Crimea, there are no reports of the Russian forces there changing the positions that they are occupying. No sign that they are falling back or pulling out of that region at all.

And as you say, we are expecting to hear from President Vladimir Putin any moment. This will be significant because it is the first time he will have made public statements since this operation began in Crimea.

ROMANS: Phil, do we have any idea what he plans to say or what he's going to use these remarks to sort of frame the situation?

BLACK: We don't know precisely why he has decided to speak now, no, and not in the days leading up to this, because really, his silence has been quite notable. We can only assume that he's going to continue to mount what has been the Russian government argument for justifying this action, which is that Russia believes is acting out of humanitarian interests, to protect the human rights, it says, of Russian citizens, Russian speakers, those who identify culturally with Russia in those southern and eastern regions of Ukraine, because Russian officials say -- we heard it as eventually as last night at the U.N. Security Council -- that there are now ultranationalists, armed gangs of Ukrainian extremists who are threatening the safety, the lives of those Russian citizens, those ethnic Russian peoples in those Ukrainian regions.

ROMANS: All right, Phil black. Thank you so much, Phil, for that. We'll check back with you.

We're waiting for Putin to speak at any moment. As reports came in that Russian troops ended their military exercises near parts of the Ukraine border, the global markets recovered. Stocks in Asia closed mostly higher Tuesday. European stock markets all higher right now as well.

And U.S. stock futures, they're showing a triple-digit gain after Monday's very ugly losses. The price of oil and gold, wheat and corn all lower this morning. Remember, yesterday's huge run-up in those prices as tensions escalated over the Ukraine/Russia crisis.

And now, this morning you're hearing money managers and market experts saying they expect volatility in the near term. That means you could see big moves one day to the next, but they think the U.S. bull market won't be stopped, ultimately, by the crisis in Ukraine, as long as it doesn't get worse.

Now, U.S. exports to Ukraine, $2 billion a year, exports to Russia, $10 billion a year.

The most damage could be to Europe's economy if this thing escalates. Russia a major energy supplier for Europe. Remember, that region is only beginning to emerge from a long recession.

BERMAN: And Europe dependent on Russia, which is why many of these European countries seem to be dragging their feet right now to implement some of the sanctions that the United States might like to see.

ROMANS: And Russia dependent on Europe. It needs to be paid for the gas it gives them. The Russian economy has been moving, you know, in a negative way, I would say, over the past six months or so. They need each other.

BERMAN: And a lot happened in Russia yesterday. The market's staggering losses.

ROMANS: Unbelievable.

BERMAN: But the price of oil and gas going up, which does benefit Russia.

ROMANS: Right.

BERMAN: They may be able to survive this for some time.

ROMANS: There are a lot of pieces on this chess board.

BERMAN: Indeed.

All right. Happening today back in Washington, President Obama set to unveil his 2015 budget proposal, complete with tens of billions of dollars in additional spending for education, job training, also the military. The proposal does call for extending some tax breaks to lower-income Americans, the earned income tax credit. The new benefits would be paid for by closing loopholes for higher paid workers, ones they use often to reduce their tax burdens.

ROMANS: Meanwhile, the Pentagon's budget proposal will detail those much-discussed cuts to the Army. That will reduce the troop levels to their lowest amount since before World War II. Defense Secretary Chuck Hagel today plans to outline how the military will instead use its $500 billion budget to expand cyber warfare capabilities and develop other high-tech weapons.

BERMAN: Yes, but these cuts very, very controversial now in light of what's happening in Ukraine.

Meanwhile, final, new rules aimed at reducing greenhouse gases coming from cars and trucks. The EPA is putting the finishing touches on regulations requiring refineries to cut sulfur levels in gasoline by 2017. This also forces lawmakers to change their vehicles to reduce tailpipe emissions. The EPA and some environmental groups call it a win for planet Earth, but the oil industry says the new rules will drive up costs for everyone.

ROMANS: Israel's Prime Minister Benjamin Netanyahu, continues his trip to the U.S. today with a speech before the American/Israeli public affairs committee, a day after meeting with President Obama at the White House, where the two discussed Middle East peace efforts and Iran's nuclear program.

They showed little sign of finding common ground on those issues. Netanyahu is likely to bring those topics up during his speech today. BERMAN: More calls today for protests in Venezuela from jailed opposition leader Leopoldo Lopez. The Harvard-educated politician telling supporters in a video message to not give up their fight to remove President Nicolas Maduro from power. His government calls the protests dangerous disruptions of public order.

ROMANS: We could be seeing history today for much of the country, historic cold temperatures from the Midwest to the South. Lows today may barely hit zero, their lowest point in more than 100 years. We could see new records from Virginia to New York City.

BERMAN: No relief yet in Tennessee, where snow and ice dragged down trees and power lines in many places. Look at that. These pictures are from Memphis where some 15,000 customers still have no power this morning.

ROMANS: Oh, my goodness.

BERMAN: And for others, it could be some time before things get back to normal.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: They're telling me it's going to be days before it's back on.

UNIDENTIFIED MALE: I've got a gas fireplace and I'm fixing a fire with a generator and turning on the electric heater.

UNIDENTIFIED MALE: This ice storm has caused so much damage to so many people.

(END VIDEO CLIP)

ROMANS: In Virginia, the fast-falling snow meant accidents on the roads. These pictures from Richmond, the Richmond area, hit by just a few inches of snow, but that was enough to send these cars just spinning. And officials warning this morning, it could be even worse, as the snow freezes into ice. Crews were out all night treating those roads.

BERMAN: Near Louisville, Kentucky, this beer truck, wow, wound up off the road. Look at that -- light beer from Miller -- after sliding and spinning out on Interstate 65. This is just one of dozens of accidents reported because of the snow.

ROMANS: So many schools in the Washington, D.C., area are opening late this morning or they're closed again because of the icy roads, refreezing after yesterday's snowfall. The federal government will be opening two hours late this morning.

BERMAN: And look at this picture. This comes from a weather satellite. That shows the great lengths. They're now more than 90 percent covered in ice. Look at that picture! This is the most ice these lakes have seen in some 20 years, almost completely covered. Beautiful. ROMANS: Wow! Indra Petersons is tracking this cold. That picture is gorgeous, but it's a sign of what we've all endured. And when will it all end?

INDRA PETERSONS, AMS METEOROLOGIST: That's a good question, right? Because it looks like another week filled with these temperatures that continue to go way down. We're talking about this cold arctic air, this jet stream diving all the way down even to the Southeast again. So, look at this -- these temperatures this morning, seeing a lot of single digits out there. Detroit just 4 degrees, Indianapolis 8, even all the way into the Northeast just some teens. Burlington without a windchill feeling at subzero, 6 below this morning.

We're talking about temperatures all the way, even to the Southeast, below freezing this morning. And we're actually, potentially here, going to have some record lows this morning. Atlantic City actually had a record yesterday, not only for yesterday, but for the entire month of March already. Not the way to start off. Looks like Detroit right now, current temperature 4, the record 5. We've already seen a record there.

Now, here is what we're expecting. Look at this. As we go towards the afternoon, well below average. Memphis 30 below where they should be. Typical trend at this time of year, it seems like at this point. This is what we've been seeing all season long, but not what we want to be seeing, 15 below tomorrow. Even tomorrow through Chicago, things are not rebounding quick enough.

Now, keep in mind, this cold air's going so far south that even we're talk being in Texas having an ice storm this morning. Potentially Austin seeing 0.1 to 0.25 inches of ice, Houston, even Lake Charles, Louisiana.

Speaking of Louisiana, hello, it is Mardi Gras. We're supposed to have tank tops out, right? Not so much. Temperatures on the cool side, only in the 40s and some rain in the forecast for them. In fact, all across the Gulf, we're going to be talking about rain showers.

Not a happy Mardi Gras, guys.

BERMAN: I can't imagine they'll be having any fun down there. There's just no way they'll be able to have fun.

PETERSONS: No idea how they're going to do it.

BERMAN: All right. Indra, thanks so much.

ROMANS: The umbrella doesn't go with my sequin outfit.

BERMAN: All right. If I had a nickel for every time I said that.

All right. Happening now: drama on the witness stand. Neighbors testify what they heard the night a model was shot to death inside her Olympic boyfriend's home. We're live right after the break.

(COMMERCIAL BREAK)

ROMANS: In South Africa this morning, day two of the blockbuster murder trial of Olympic sprinter Oscar Pistorius, accused of killing his girlfriend. The first witness, a neighbor, went back on the stand this morning, describing again the screams she heard the night of the shooting.

Nic Robertson live for us in Pretoria.

Nic, what's happening in the court right now?

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: It's very dramatic, Christine. Just in the last few minutes, there's been discussion about how Reeva Steenkamp was shot, shot in the head. Oscar Pistorius in the dark there called for a box of tissues, given tissues to wipe his eyes, very emotional.

But what we've heard, intense cross examination of this witness by the defense attorney representing Oscar Pistorius, questioning the statement that the witness had given to the police compared to what she said in the courtroom, at one point getting exasperated, saying, "This is the eighth time I've asked you this question."

The state prosecutor interjected, objected. The judge said no, the question hasn't been answered, directed the witness to answer properly. This is what she said to her.

(BEGIN VIDEO CLIP)

JUDGE: When counsel asks a question, you answer the question. Otherwise, you will be in that witness box for another day and maybe tomorrow or the day thereafter. The quicker way to get out of that box is to answer exactly what counsel is asking.

(END VIDEO CLIP)

ROBERTSON: So, this seemed to undermine the witness. The witness also cross-examination, defense attorneys saying your statement is almost line by line like your husband's, and then questioning her about the screaming, getting to the point -- and this is where it got really emotional -- saying that the screaming that you heard, you say you heard after the gunshots, that couldn't have happened because Reeva Steenkamp was shot in the head and she physically couldn't have screamed.

And the defense attorney saying what you heard is Oscar Pistorius screaming because he was so intense about the situation, screaming out of the window that directly faced on to this house. What you're hearing right now in the background is a sort of protest going on here that seems to be perhaps focused about what's happening in the courtroom. Hard to say, but people here paying a huge amount of attention to the trial, and, of course, very dramatic events unfolding -- Christine.

ROMANS: Yes, I'll say. OK, glad we have you there following it for us and we'll check back with you soon. Thanks, Nic. BERMAN: Quite a scene there.

Meanwhile, in New York, jury selection resumes in the terror trial of Osama bin Laden's son-in-law. Sulaiman Abu Ghaith is one of the highest profile terror defendants to face trial in the United States. He's charged with conspiring to kill Americans and also recording videos on behalf of al Qaeda, threatening more violence just days after the September 11th attacks. Opening statements could come as early as tomorrow.

ROMANS: All right, this morning, New Jersey Governor Chris Christie back in the spotlight, holding a town hall to talk about Superstorm Sandy relief funds while the federal investigation into bridgegate apparently heating up. Attorneys for former campaign manager Bill Stepien say he's now being investigated by federal agents for any role he may have had in the shutdown of the lanes on the George Washington Bridge. Now, Stepien has so far refused to turn over documents to state lawmakers.

BERMAN: In Phoenix this morning, a police officer is fighting for his life after a standoff and gunfire that left a fellow officer and a suspect dead. Police say officers were trying to stop a man on an outstanding warrant when he hopped in a car, led them on a chase, crashed into other cars, then ran, leading to the shoot-out. None of the names of those involved have yet been named.

ROMANS: In Montana this morning, more than 300 miles of Interstate 90 are closed because of the threat of avalanches. There were six minor slides already on Monday. Authorities are worried additional rain and snow could cause more. Meanwhile, prosecutors in Missoula are considering charges against a snowboarder who caused an avalanche that destroyed a house and killed a woman. Her husband still in the hospital.

BERMAN: We're awaiting word from Russian President Vladimir Putin. That could come any minute.

Meanwhile, coming up next for us, LeBron James --

ROMANS: Wow.

BERMAN: -- and the Miami Heat making history.

ROMANS: Wow.

BERMAN: The new clear mask clearly did the trick. This could have been LeBron James's best game ever!

ROMANS: Could have been?

BERMAN: And that's saying a lot.

ROMANS: I think it was.

BERMAN: Ever!

ROMANS: It was.

BERMAN: All right. Andy Scholes will make the call for us next in the "Bleacher Report."

(COMMERCIAL BREAK)

ROMANS: All right. The NBA's best player, LeBron James, had the best game of his career last night. I mean, he was on fire. Scorching the Bobcats, 61 points. My 7-year-old came upstairs, he's like, "OMG, mom."

Andy Scholes has more in this morning's "Bleacher Report."

ANDY SCHOLES, BLEACHER REPORT: Yes, OMG is right. You know, this is why he's known as King James.

When LeBron's making shots like he is last night, he is the most unstoppable force the game of basketball has ever seen. In the third quarter alone last night, LeBron poured in 25 points. He made his first eight 3-point attempts in the game and he finished with a career-high 61 points. His previous best was 56 back in 2005.

This game was a clear statement from King James that he's not giving up his MVP award just yet to Kevin Durant.

All right, Jason Collins, the NBA's first openly gay athlete, played at home for the first time since signing with the Brooklyn Nets last night. In a pretty cool moment, the fans at the Barclays Center started chanting his name late in the game, then gave him a standing ovation as he came off the bench. According to reports, the Nets will sign Collins to a second 10-day contract later today.

All right. Trending right now on bleacherreport.com, fans in Denver can exhale. Peyton Manning will be back in 2014. It was reported before the Super Bowl that win or lose, Peyton's future depended on this offseason neck exam. Doctors have given him the all clear to keep playing.

Breaking overnight, the U.S. men's soccer team says it will play against the Ukraine tomorrow, but due to the political unrest in the country, the game has been moved from the Ukraine to Cyprus. Now, there was uncertainty that the game would go on at all. The Ukraine Football Federation told a local TV station yesterday that the game was off, but the U.S. soccer team tweeted earlier this morning that they were on their way to the game.

And guys, this is, you know, a pretty big deal. People are saying why not cancel the game altogether? But they're 100 days away from the World Cup and the U.S. team only has two tune-up games, this game with the Ukraine being one of them. So, you know, obviously, they would like to get on the field and play. And like I said, they'll try to play the game in Cyprus tomorrow. Hopefully, it goes on as scheduled.

BERMAN: Well, the U.S. team needs the game for training, but those players on the Ukraine team I think must have a lot on their minds right now. SCHOLES: True.

BERMAN: I hope they make whatever choice is right for them and their families, to be sure.

All right, Andy Scholes, really appreciate it.

ROMANS: All right. Breaking news this morning, Ukraine on the brink of war with Russia. The world ready to step in. The Russian president, Vladimir Putin, expected to speak at any moment.

We're following it all live. We're going to bring it to you right after the break.

(COMMERCIAL BREAK)