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Shots Fired at U.S. Embassy Vehicle; Poll: Obama Lifted by Economy Ahead of Speech; ISIS Holds Two Japanese Hostage; Belgian Terror Cell Linked to ISIS; Tracking Hayat Boumeddiene

Aired January 20, 2015 - 09:00   ET

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


CAROL COSTELLO, CNN ANCHOR: NEWSROOM starts now.

And good morning. I'm Carol Costello. Thank you so much for joining me.

This morning rising fears of terrorism seized the attention of world leaders from Asia to Europe. Overnight in Germany, 200 police officers fanned out across Berlin and the region charging into 13 separate homes. The sprawling anti-terror sweep targeted associates of two men arrested last week. They're suspected of belonging to a jihadist terror cell.

A similar story in Belgium unfolding in neighboring Belgium. Police are hunting for this man, described as the ringleader of the a terror cell, also targeted last week. More importantly he's considered a key link between bad terror cell and Belgium, and ISIS operatives in Syria.

And ISIS issues a new blood chilling ransom demand telling Japan to pay $200 million or two of its citizens will be slaughtered. The ransom amount identical to what Japan just pledged countries now fighting ISIS.

COSTELLO: Let's begin with this latest is ransom demand. CNN's Will Ripley has more for you in Beijing.

Hi, Will.

WILL RIPLEY, CNN CORRESPONDENT: Carol, this news is really hitting hard for the people in Japan. It is a pacifist country, as you know. It has a self-defense force. Its military does not engage in combat missions overseas so unlike the Americans and British citizens who were killed by ISIS in retaliation for their country's military action, in this case these two Japanese citizens, Kenji Goto and Haruna Yukawa, are being -- are being put on the ground forced to kneel with an ISIS executioner standing in the middle of them because their country has pledged aid, assistance, to help the refugees of ISIS, the people whose lives are in turmoil as a result of this group's brutality.

And now Jihadi John known around the world for his distinctive British accent, threatening to take two innocent Japanese lives if the country does not pay ISIS the same amount that it has pledged to help the coalition against ISIS.

The reaction understandably from the Japanese prime minister, Shinzo Abe, outrage.

COSTELLO: I thought we were going to hear from the Japanese prime minister but he did express outrage and he intimated that Japan would not be paying the ransom.

Is that what you understand, Will?

RIPLEY: Yes. You know, he called -- Shinzo Abe called these actions unforgivable and he again stressed, one, we're going to actually have the sound ready for you now, Carol. So listen to what the prime minister said. He stressed that this money was intended to help people, not to engage in the battle against ISIS.

(BEGIN VIDEO CLIP)

SHINZO ABE, JAPANESE PRIME MINISTER (Through Translator): It is an unacceptable act to threaten us in exchange for human lives and not feel angry about it. I strongly urge them to immediately release the hostages without harming them.

The pledged aid is very important to the refugees in need and has nothing to do with the Islamic communities or the radical militants.

(END VIDEO CLIP)

RIPLEY: So, Carol, we're choosing to show these two men, Kenji Goto and Haruna Yukawa, in the capacities that they serve. Kenji Goto, is well respected freelance journalist in Japan whose covered war zones, who was last heard from on October 23rd. That was the last time he tweeted from his Twitter account where he was covering the crisis in the Middle East, covering the fight against ISIS. He disappeared shortly after that.

And Haruna Yukawa, a 42-year-old who suffered a lot of personal loss. His wife died of lung cancer. His business went under, the result of Japan's stagnant economy, and so he went to the Middle East. His friends and family say looking for himself. He started a private security company, but now these two Japanese men are finding themselves in the hands of ISIS and perhaps facing just hours before ISIS is prepared to do to them what they did to so many other people brutally just because their government pledged to help people -- Carol.

COSTELLO: All right. Thanks so much. Will Ripley reporting live for us this morning.

Now let's head to Belgium and its central role in Europe's fight against terrorism. The reason is simple. The small nation is thought to have the highest percentage of people who are radicalized.

Senior international correspondent Ivan Watson is in Brussels with more.

Hi, Ivan.

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Hi, Carol. You know, a senior Belgium official has identified a man that Belgian authorities believe is the ring leader, the master mind of an alleged jihadi plot that police swooped down on last week in Belgium arresting at least five people, and that raid resulted in two suspects dying in a gun battle against Belgian Police.

The man in question is named Abdul Hamid Abaaoud. And he's a very notorious figure here in Belgium because he's a Belgian citizen, he hails from Brussels, the capital of Belgium, and the capital of Europe for that matter. And he's believed to be of Moroccan descent.

He is notorious because he traveled to Syria, joined ISIS, and is believed to have been filmed in one video laughing, driving a pickup truck, dragging at least a half dozen corpses through a field in Syria.

He's also famous because he's believed to have brought his teenage younger brother, a 13-year-old named Yunis to those bloody battle fields in Syria to join ISIS. And the boy is believed to have been photographed alongside older fighters and has been described in the Belgian press as the youngest fighter in ISIS, the youngest jihadi there.

So the Belgian authorities are on the lookout for this man. They last tracked him to Greece, but so far we do not have any information that he has been caught. Instead, another man was caught in Greece over the course of the weekend by Greek Police. Belgian authorities waiting to extradite him.

They say he is an Algerian citizen. The bulk of the people there're looking for we're told are Belgian citizens. And this gets to the core of the problem here. They are home grown suspected jihadist terrorists. And as you mentioned, Belgium has had more of its citizens per capita than any other country in Europe travel from here to join ISIS, to join other militant groups in Syria, and the big challenge this country is dealing with is what to do with those who decide to come home and what to do about that potential threat that they pose to this society -- Carol.

COSTELLO: All right. Ivan Watson reporting live from Belgium this morning.

As the trail heats up for the ring leader of that Belgian terror cell, we're learning more about the trip Hayat Boumeddiene may have taken to disappear in Syria.

The domestic partner of Paris kosher market attacker Amedy Coulibaly is desperately wanted to shed light on the attack and the shooting of a French policewoman days before. She was last seen January 8th moving from Turkey to Syria. And she may have been smuggled in by professionals for the equivalent of $42.

In a CNN exclusive, Arwa Damon spoke to the smugglers.

(BEGIN VIDEOTAPE)

ARWA DAMON, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): Hayat Boumeddiene today among Europe's most wanted women. But on January 2nd, before her name was internationally known, Boumeddiene and a male companion cleared customs with ease at Istanbul's secondary airport.

Yet something raised a red flag with Turkish authorities and the two were placed under surveillance. They checked into this hotel on the Asian side of Istanbul, were monitored for a couple of days, but after engaging in what was described as touristic activities, the surveillance stopped.

All this happened in the days leading up to the Paris attacks.

(On camera): Following the Paris attacks the Turks alerted the French that they had already in fact gathered some intelligence on Hayat Boumeddiene. The French then provided the Turks with phone numbers that they were able to use to further track her movements.

Hayat Boumeddiene's last known location? Sanliurfa, along the Turkey- Syria border.

(voice-over): Sanliurfa has become a key hub for transit into Syria. The touristic city saw its population swell due to the refugee influx. And just about anyone can blend into the chaotic streets, and from here there are plenty of routes to the next leg of their journey.

We meet these two men in a town close to the border. They are both professional smugglers.

For the last few months the soldiers have really cracked down, one says, but there are always security breaches and alternate routes to be exploited.

The other tells us that a woman in all black paid him around two to three times the going rate, right around when Turkish authorities believe Boumeddiene disappeared into Syria.

She said, "I will give you 100 lira just to get me to Syria," he recalls. "She was entirely covered in black like I am now."

It's the first time since the war in Syria began that either of them have taken a woman across on her own. The smuggler says she was of medium build and guesses her age to be like Boumeddiene, in her mid 20s. She spoke classical Arabic and did not have a Syrian accent. That, he claims, is all he knows.

"I saw the 100 lira and I did not ask anything," he tells us.

On the back of a motorcycle they headed down this border road, dotted with potential illegal crossing points.

(On camera): The Turkish military stopped us before we could get to the area where this woman crossed into Syria, but it is further down the road in a similar sort of landscape. (Voice-over): There is no way of knowing if it was Boumeddiene, but

within an hour of speaking to the smuggler the woman covered in black was in Syria.

Arwa Damon, CNN, on the Turkey-Syria border.

(END VIDEOTAPE)

COSTELLO: It was his split-second decision that saved lives. Today Lassana Bathily, a Muslim, will become a French citizen.

Bathily is the Malian national who helped hostages to safety during the kosher supermarket siege in Paris. His heroic efforts inspired more than 380,000 people to sign an online petition calling for him get a French passport as well as the Legion d'honneur, the country's highest honor. Bathily hid people in a cold storage room as the gunman assaulted the store.

(BEGIN VIDEO CLIP)

LASSANA BATHILY, KOSHER SHOP HERO (Through Translator): Before I left I asked if they wanted to leave with me. They didn't want to. They said, no, it wasn't a good idea. They thought if they came up they might make a noise. Perhaps he could be waiting for us. I didn't want to force them so I turned off the light, shut off the fridge and shut the door.

(END VIDEO CLIP)

COSTELLO: Bathily was granted French nationality by France's Interior minister.

Still to come in the NEWSROOM, shots fired at the U.S. embassy -- at a U.S. embassy vehicle in Yemen as the bloody battle for the failing country rages on.

CNN senior international correspondent Nick Paton Walsh is the only Western TV journalist on the ground in Yemen -- Nick.

NICK PATON WALSH, CNN INTERNATIONAL CORRESPONDENT: It's clear, says the U.S. embassy, that that vehicle was targeted with some shots at some point. We don't quite know who the gunmen were but a very tense capital now -- Carol.

(COMMERCIAL BREAK)

COSTELLO: Fears this morning that a bloody power struggle in Yemen could erupt into chaos. The U.S. military has upped its alert level for the failing nation, but the situation is so dangerous, officials say there's little they can do but watch and wait.

Remember, Yemen is crucial to America's and Europe's war on terror. The failing nation isn't just a breeding ground for terrorists, it's home to the al Qaeda affiliate that claims responsibility for the "Charlie Hebdo" massacre. Technically, a fragile cease fire is in place, but shots were fired

hours ago at a U.S. embassy vehicle and Yemen's information manager tells CNN's Christiane Amanpour the government isn't in control anymore.

(BEGIN VIDEO CLIP)

CHRISTIANE AMANPOUR, CNN CHIEF INTERNATIONAL CORRESPONDENT: Tell me how bad it is right now. What is the state of control of the government?

UNIDENTIFIED FEMALE: Almost nonexistent.

AMANPOUR: Are you telling me the government is not in control?

UNIDENTIFIED FEMALE: Yes. Shocking, huh?

(END VIDEO CLIP)

COSTELLO: CNN senior international correspondent Nick Paton Walsh is the only western journalist on the ground in Yemen. He's live in the capital.

Tell us more, Nick.

NICK PATON WALSH, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, Carol, as you join me, we are hearing and it's hard to ascertain what this means, we are hearing sporadic gunfire from different parts of the city. Now, that coincides with some reports suggesting that the cease fire may be crumbling in some areas.

I'm hesitant to declare it over because that would be a seismic moment for Yemen's struggle at the moment, but we are hearing those occasional clashes of gunfire. That can sometimes be security guards firing in the air to keep people away.

But it seems as though the political talks are going on longer than many had hoped. They were supposed to start this morning. The Houthi rebels who were involved in a lengthy jewel and artillery around the presidential administration yesterday meeting with President Hadi. He's going to go back to his administration because the Houthis we saw this morning, there are a lot of Republican guards in a different part of it, too. They're loyal to the president.

The question is when does the political clock run out of time? When do those gunmen on the streets say, right, we've had enough, we're trying to resolve this by force? There are fears this could potentially be happening as we speak.

But, of course, as you mention, Carol, the U.S. embassy now very much in the spotlight. Real concerns that after that vehicle was targeted near the embassy last night, it's an armored SUV quite distinguishable by people in the city here, you know that's going to be containing U.S. diplomats as it was in that case. Nobody injured here but the embassy clear that while shots were fired in the air at first, they were then fired at the vehicle directly. I quote the embassy who said, these were not warning shots. There was

intent there. We understand that the vehicle then drove on into the embassy away from that particular scene, but that will certainly raise concerns.

The security of the embassy here, we say -- we've heard they're always at a heightened posture. They haven't changed operations today as a result. Of course, many in Washington will be concerned -- Carol.

CUOMO: All right. Nick Paton Walsh reporting live from Yemen this morning -- thank you.

Still to come in the NEWSROOM: the middle class takes center stage in Washington tonight in President Obama's latest State of the Union. How will the president's policy resonate with a Republican-controlled Congress? Talk about that next.

(COMMERCIAL BREAK)

COSTELLO: Amid positive signs in the economy, President Obama heads into tonight's State of the Union with his highest approval rating in nearly two years. That's according to a new "Washington Post"/ABC News poll which shows 50 percent of Americans approve of how the president is doing his job, but Mr. Obama also faces a Congress that is now firmly in the hands of Republicans for the first time since he entered the White House and has planned to focus on the middle class issues in his speech may not do much to bridge the political gap.

Joining me now, CNN White House correspondent Michelle Kosinski and CNN chief congressional correspondent Dana Bash.

Welcome to you both.

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Good to see you, Carol.

COSTELLO: Nice to see you guys, too.

Michelle, I want to start with you. Give us a preview of tonight's speech.

MICHELLE KOSINSKI, CNN WHITE HOUSE CORRESPONDENT: Well, the White House has described it as being -- you know, they put it into three words basically, middle class economics. A lot of this has been laid out over the last couple of weeks. These big proposals like two years of free college education, these tax reforms. Yes, as you put it, many Republicans will oppose.

So, we don't know exactly what the surprises are going to be tonight. The White House has said that they still have more to come, that stay tuned, they're going to have something more to lay out there, but they've sort of set this up in an interesting way because they say a lot of their proposals are actually Republican ideas, ideas that many Republicans have supported in the past, things like expanding education tax credits, for example. So, they've in some ways put Republicans on the spot. Are Republicans going to support these? Unlikely. Are they going to

oppose them? If they do oppose them, then what are they going to propose that is also going to court the middle class? Because this is not only about President Obama's legacy and what he wants to do, whatever the likelihood is of it getting done, but it's also looking ahead to 2016 and this fight for the middle class, you know, what's going to benefit it most and who's going to have the better ideas, Democrats or Republicans, Carol.

COSTELLO: And, Dana, we've heard many Republicans come out and talk about lifting people out of poverty. They may not agree with all of President Obama's ideas, but as Michelle said, maybe some. So, will there be a little give and take?

BASH: Well, we should all be optimists and hope that, like Michelle said, Republicans do feel that they have to prove that they can govern, there will ultimately be. But the big problem from the Republican perspective isn't so much what these policies are, it's how the president is proposing to pay for it, and that is to increase taxes on the wealthy. It not only serves broadly with trust funds but also by raising the capital gains tax rate.

That is something that is a non-starter for Republicans because they want to go forward with tax reform by doing the opposite. They want to lower the tax rate for capital gains and also for businesses.

So, what you have are two very different philosophies in how to keep the economy going and how to keep, you know, the good news that we are seeing in the economy, to not halt it.

So, that's the big problem here. But there is going to be some also problems with Democrats, Carol, because the president is going to be talking about free trade, for example. He's got a lot of problems on the left flank of his party, people who don't want him to do that. That is maybe the one big area where the president can work with Republicans. He's got to convince his fellow Democrats.

COSTELLO: OK. So, Michelle, the voters might be a little confused as to why President Obama's laying out these initiatives now when Republicans control both houses of Congress when there was a day not long ago when he actually could have gotten some of these ideas past Congress because Democrats were in control.

KOSINSKI: Right. That has been the question. Why wasn't this done before? Republicans have even countered that -- well, some of these proposals, something similar has been out there passed by the House but they stalled in the Democratic controlled Senate before.

So, what the White House is saying, well, they've been trying to do various things over the course of years. They've been working on pressing issues, the economy was in a bad place. Now that the economy is improving, they say that that's a testament to what they have been doing for the middle class. Now, they're wanting to take that several steps further.

So, they say, OK, sure. It might not work. It might not make it through congress, such as this tax proposal, but they said they're still going to put it out there. This is starting a debate and it's starting a conversation, and Republicans, you know, the onus is on them now to come up with something better, says the White House.

COSTELLO: Yes, sounds like the same --

(CROSSTALK)

BASH: That is such a great point because let's just be real here. The reason the White House didn't get more aggressive on proposing tax increases is because they couldn't do that to their fellow Democrats who in November were on the ballot, many of them in red states who didn't want to come close to taking a vote on increasing taxes. It turned out it didn't matter because most lost anyway.

But I think what you're seeing when you see the president come into the chamber tonight is a very different kind of president. He's almost unshackled, ironically, because he doesn't have to protect the Democrats in control of Congress because they're no longer in control of Congress. It is the first time he's going to be speaking to a completely GOP-controlled Congress.

KOSINSKI: Yes, maybe he should start it off by saying the bear is loose, or something.

COSTELLO: Maybe so. I have to leave it there. Michelle Kosinski, Dana Bash, thanks as always.

And remember, our special live coverage of the State of the Union starts tonight at 7:00 p.m. Eastern, but how did President Obama fare on his 2014 promises?

Tom Foreman takes a look.

TOM FOREMAN, CNN CORRESPONDENT: President Obama has long argued that a higher minimum wage will be good for everyone, and he pushed on that front during his last State of the Union.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: You'll get business as customers with more money to spend. It does not involve any new bureaucratic program, so join the rest of the country. Say yes. Give America a raise.

(END VIDEO CLIP)

FOREMAN: In November, voters in Alaska, Arkansas, Nebraska, and South Dakota all voted for more money at the bottom end of the pay scale. As of January 1st this year, 29 states have a higher minimum wage than the federal minimum of $7.25 an hour, but all of that is happening at the local level. The president did issue an executive order to raise the minimum wage for new federal contractors. But overall, the effort to raise the federal minimum wage is stalled.

(COMMERCIAL BREAK)