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U.S., Cuba to Announce Embassy Openings; Trump Gains Nine Points from May Survey; Greece Open to Deal. Aired 10:30-11a ET

Aired July 01, 2015 - 10:30   ET

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

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[10:29:50] PAMELA BROWN, CNN ANCHOR: Good morning to you. Thank you for being here with us. I'm Pamela Brown.

And for the first time in more than five decades, the Cuban flag will soon fly high in the nation's capital, right in front of the Cuban embassy. That's because the U.S. and Cuba have reached a historic agreement to reopen the embassies. All of this according to two senior administration officials.

The announcement, which has been in the works for months now, will mark one of the final steps in restoring full diplomatic ties between both countries which have long been splintered by Cold War tensions.

And we've also just learned that a letter from President Obama has been delivered to Cuba's leader Raul Castro. This video right here shows the U.S. ambassador handing off the note at the Cuban foreign ministry.

Let's get right to CNN's Wolf Blitzer in Washington for more on this. Wolf, an honor to have you on to talk about this. What do we expect to hear from the President today?

WOLF BLITZER, CNN HOST: The President will announce that the full diplomatic relationship with Cuba which has been in the works now for six months is finally going to get going. The tentative date is around July 22nd for the U.S. embassy, a formal embassy to be opened in Havana; a Cuban embassy to be opened here in Washington, D.C. The first time since 1961 when then President Dwight Eisenhower broke off the diplomatic relationship with the Castro regime in Havana.

This is a huge, huge development in U.S./Cuban relations. There's been a diplomatic interest section. The head of that diplomatic interest section, the U.S. official, he is a U.S. diplomat. He doesn't have an ambassadorial rank. He's not an ambassador. The notion now is that there will be a full ambassador, a U.S. ambassador in Havana and a full Cuban ambassador here in Washington.

There will be opposition in the U.S. Congress, as you know Pamela. There will be some members of Congress who will oppose funding the construction, the development, the and expansion of that building which will now become a formal U.S. embassy as opposed to a diplomatic interest section technically under the control of the Swiss government.

There will be opposition once the President formally nominates someone to serve as the U.S. ambassador to Cuba. That person has to be confirmed by the United States Senate. There will be opposition. But the sense is it's going to move. This train is leaving the station, the full diplomatic relationship will be announced in the Rose Garden in the next few minutes when the President shows up there.

And then the process will get forward culminating at the end of July when presumably Secretary of State John Kerry will go to Havana himself to formally reopen that U.S. Embassy.

BROWN: As you point out, though Wolf, while this is a big step, it's not the final step in restoring that relationship.

Wolf Blitzer, thank you so much for that.

And our Alina Machado is in Miami. She's been getting reaction from the Cuban community there. So what are they telling you -- Alina?

ALINA MACHADO, CNN CORRESPONDENT: Pamela, no one is particularly surprised here among the Cuban-American community. You know, when the President announced in December that these changes were coming, we saw a very mixed but a very strong reaction among some members of the Cuban American community. Some of the younger generations favoring change, people who were part of the older generations, the people who lived through the Cuban revolution who came to this country in the 50s and 60s -- they were staunchly opposed to any change in terms of Cuban-American relations. What we're hearing here is more along those lines. The people who opposed any change or saying they don't favor the opening of the embassies.

But again, if you look around me, not many people out here, not the kind of response that we saw back in December when these initial changes came out -- Pamela.

[10:35:00] BROWN: Alina Machado, thank you for bringing the perspective there from Miami.

We're going to have live coverage of that big announcement between the U.S. and Cuba beginning at the top of the hour. So be sure to stick around.

And still to come right here in NEWSROOM, Donald Trump moving up in the latest CNN poll. But does he have a shot at beating Hillary Clinton? We're going to discuss that right after this break.

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BROWN: Guess who just dumped Trump? Macy's pulling the Donald's merchandise from its shelves. But this is good news for the GOP candidate. A new CNN poll showing Bush leading the field at 19th percent and Donald Trump comes in second with 12 percent. Mike Huckabee, Ben Carson and Rand Paul rounding out the top five as we see here. Bush has improved his standings by six points since May. But

Trump's gains are even more impressive. He is up nine points.

So what's behind the surge in support for Trump and can it last?

[10:40:01] Here to break down the numbers for us, Democratic strategist Donna Brazile and Republican strategist Margaret Hoover. Ok Donna --

MARGARET HOOVER, REPUBLICAN STRATEGIST: Good morning.

BROWN: Ok, Donna -- starting with you here -- good morning. Great to have you all with us.

DONNA BRAZILE, DEMOCRATIC STRATEGIST: Thank you.

BROWN: We have a lot to talk about here. I have a feeling that some strong opinions are about to come out.

Donna -- to you first. Trump doubling down on those inflammatory remarks against Mexico and illegal immigrants but he continues to not only gain in the polls but really surge. Why is he resonating?

BRAZILE: You know, this is just a moment for Donald Trump. I mean we've seen this movie before. Donald Trump knows how to excite a crowd. He's an entertainer. He knows how to rally the most conservative of the conservative base.

But unfortunately I think his inflammatory remarks, his insensitive, intolerant comments will not only get him in trouble but get the Republican Party in trouble. The sooner Donald Trump can get off the stage and allow some of the more serious candidates to compete for the votes, I think the Republicans will be better off.

But look as a Democrat and somebody who believes in the inclusiveness and the tolerance and just the diversity of our country, I would hope that Mexican-Americans and other immigrants do not take any personal insult from Donald Trump. He's an entertainer. He's trying to incite the crowd.

In no way will his remarks I think resonate with the Republican voters or the Democratic voters or Independents. It's insulting and I'm glad Macy's and others are dropping him.

BROWN: And let's talk about this in the wake of those controversial remarks, as you point out. His merchandise has been pulled from the shelves at Macy's. And here's what Macy's is saying. "In light of statements made by Donald Trump which are consistent with Macy's -- which are inconsistent, we should say, with Macy's value, we have decided to discontinue our business relationship with Mr. Trump." This follows NBC and Univision.

But could all of this actually enhance his image with voters because, again, his poll numbers went up in the wake of this.

HOOVER: Look, this is a flash in the pan. Yes, it shows that there's some kind of a short-term benefit. And you know what, I think this run for Donald Trump is nothing more than a marketing play for him. I mean we'll know if he's serious in 120 days. That's exactly how long he has. He's got two 45-day extensions and another 30-day extension before he has to put all of his financial information on paper for the American people to see.

Does anybody think that Donald Trump actually wants that level of transparency into his finances, his personal finances? Actually, is he actually worth $9 billion? We'll see. I think that he's in just long enough to shake up the field for the first couple of debates and then get out. Bye guys thanks -- here's my new TV show.

BROWN: You talk about shaking up the field, you think that Chris Christie can actually benefit from him. How so?

HOOVER: Chris Christie benefits the most from Donald Trump because think. Chris Christie -- the hit against Chris Christie was he's too brash, he's too frank. He can't be the President of the United States. Well, look, Chris Christie didn't call Mexicans rapists and drug runners. Chris Christie actually has won twice in a blue state with 51 percent of the Latino vote second time around -- took it up 19 percent from his 2009 win to 2013 win. So Chris Christie actually in comparison to Donald Trump actually is a statesman.

BROWN: Interesting perspective there.

Let's pivot to the Democrats, Donna. Hillary Clinton holds double-digit leads over all of her Republican rivals. In your view, does this cement her as a front-runner?

BRAZILE: You know, she has said over and over again and I take her at her word that she's going to earn every vote out there across the country. I think she is a strong candidate.

But we also have a very strong field. I have to say, Bernie Sanders is, you know, attracting a lot of support out there in terms of first-time voters and others. Martin O'Malley, Lincoln Chafee, Mr. Webb and, you know, who knows Joe Biden might jump into the water. But I think Secretary Clinton has a formidable lead because she is someone who's taken what I believe tough stances on very important critical issues like immigration reform.

Something I hope Republicans will follow her lead and start talking about these tough issues. The economy, criminal justice reform, voting rights, campaign finance reform. So if they can follow her lead, perhaps they might lead their own party.

BROWN: All right. Just the beginning. Donna Brazile, Margaret Hoover, thank you so much. Appreciate it.

HOOVER: I'm having fun.

BRAZILE: Thank you.

BROWN: And still to come right here in NEWSROOM, an about-face for money-troubled Greece on a proposed bailout. But it could be too little too late for the debt-laden country.

[10:44:21] We're going to discuss that after this break.

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BROWN: Breaking news: we just heard moments ago from Greece's prime minister. And he asked Greeks to vote "no" in Sunday's referendum on the terms of a bailout deal. But earlier this morning, an official told CNN the Greek government had made a dramatic turnaround and was ready to sign on to a bailout package it rejected just a few days ago.

So many twists and turns. Our business correspondent Samuel Burke is here to break it down for us. This is really confusing. I'm just going to put that out there. I'm confused.

Help us understand this. European leaders apparently getting one message, the people of Greece in the beginning a different one. What's going on here?

SAMUEL BURKE, CNN BUSINESS CORRESPONDENT: Right. You want to start by saying anybody who's sitting and watching this and thinking, how does this affect me sitting here in the United States. The United States does $3 billion of trade a day with the European Union. So anything that happens to Greece affects the European Union, which affects us.

So just take a look at the big board right now. If your team can bring up the Dow Jones numbers -- it's up over 100 points on this news that you were just talking about, Pamela, that all of a sudden the Greek prime minister said, remember that offer you gave me a few days ago and I rejected? Now with all this news, it looks like I'll take it.

But the problem is with the Greeks, they always come with caveats. Who knows if they're going to take it? Yes, markets are up here in the United States and around the world quite frankly. Every single stock market I've been looking at is way up. But who knows if Europe will take it at this point? Is it is not time to breathe a sigh of relief yet.

[10:50:11] BROWN: It's certainly been an ongoing saga. And the question will the other side take this deal with the caveat.

BURKE: Who will blink first?

BROWN: Who will blink first.

So Greece isn't the only country facing a huge debt crisis, of course. Puerto Rico announcing that it's looking at defaulting. What can be done there? What's happening?

BURKE: Well, when you hear big lending, big spending and harsh austerity, you think of what's happening in the Mediterranean. But that's what's happening in the Caribbean, in our own backyard because don't forget Puerto Rico is a commonwealth of the United States. No, they don't pay taxes but they hold U.S. passports.

So they have $73 billion in debt. How did they get here? In 2004, they had a real estate crash, long before the one we had here in mainland America. In 2006, they lost a major U.S. tax break for factories there. And then they have triple tax-free bonds. What the heck is that? It means that if you buy bonds in Puerto Rico, you don't have to pay local, state or federal taxes. So a lot of people have been pouring money into Puerto Rico, which is making their debt go up.

But what we're hearing from investors is actually the United States has way more exposure to Puerto Rico than they do to Greece. So a lot of people with bond funds have to be very, very careful. So it's something that we have to keep our eye on though we are getting word that there's some optimism for their negotiations with creditors.

BROWN: Interesting. And the White House said that it wasn't going to bail them out -- right?

BURKE: That's exactly right. Unlike Greece where you can get an opinion from an economist on just about anything, they'll tell you one thing, another one will tell you another. Every person with whom I have spoken has said, there's no way the United States is bailing out Puerto Rico. So unlike the Germans who have been sending their tax money, their hard-earned money to Greece, we don't have to worry about that, at least according to these economists, at least for now.

BROWN: All right. Well, thank you for taking a very complex issue and breaking it down for us in simpler. Thank you so much Samuel, we appreciate it.

And still to come right here in the NEWSROOM, a historic day for the U.S. and Cuba, the two countries renewing its diplomatic ties. Live coverage of the President's remarks at the top of the hour.

Stay with us.

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[10:56:26] BROWN: Checking top stories now, the Indonesian military is under scrutiny following a fatal plane crash there. At least 135 troops and family members died after a plane slammed into a neighborhood Tuesday. The crash is the sixth involving an Indonesian air force plane in the past decade. The country's president is calling for a review of its aging military equipment.

The FBI is investigating a series of attacks on Internet cables in the San Francisco Bay Area. 11 fiber optic cables in the Bay Area have been cut since July of last year. The attacks have caused massive Internet outages across the region. Experts say the attacks highlight the vulnerability of the nation's Internet infrastructure.

And it's being compared to a war zone. Homes leveled, businesses burned. Firefighters are trying to contain the Sleepy Hollow wildfire in Washington. The flames destroyed at least 29 houses and damaged four businesses. That's it for the NEWSROOM. Thank you so much for being here

with me on this Wednesday.

Let's head over to Wolf Blitzer in D.C. where the President is just minutes away from a press conference on the U.S. and Cuba renewing diplomatic ties.

BLITZER: Hello. I'm Wolf Blitzer reporting live from Washington. We'd like to welcome our viewers here in the United States and around the world.

This is CNN's special live coverage of major news from the White House.

Any moment now, President Obama will announce an historic development in U.S. relations with Cuba. You're looking at live picture -- the Rose Garden at the White House. We're expecting to hear that formal diplomatic ties at the highest ambassadorial level are being restored. Each country will open a full embassy in the other's capital. It's perhaps the most tangible symbol on the ongoing thaw between the two countries after decades of bitterly cold relations.

Over the last few months alone, we've seen the U.S. loosen serious travel restrictions to Cuba and to permit some new economic activity between the two countries. Cuba has represented one of the last vestiges of the Cold War. Normal relations with the island nation less than 100 miles from the United States are unheard of for a lot of Americans or Cubans born after 1961.

Washington considered Fidel, later Raul Castro's Cuba a state sponsor of terror until only a month or so ago when Cuba was officially removed from the U.S. State Department's list of countries that support terror.

Let's talk about the political, economic, the social, the historic impact of what is about to happen, the next steps that will take place.

Our Jim Acosta is over at the White House. Here with us in Washington, our chief national security correspondent Jim Sciutto, our global affairs correspondent Elise Labott, our own man in Havana, Patrick Oppmann is standing by; and Alina Machado, she's in Miami's little Havana section where so many Cuban-Americans live.

Let's go to the White House first. Jim Acosta, set the scene for us.

JIM ACOSTA, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, we know this was one of the top foreign policy priorities for this president ever since he was reelected back in 2012. It was negotiated in secret by one of his top national security advisers, deputy National Security Adviser Ben Rhodes. And then the plan was hatched last December when President Obama and Cuban president Raul Castro announced to the world that they are re-establishing diplomatic relations. That's going to culminate in this announcement that we're going

to be hearing in just a few moments. Here in the Rose Garden, President Obama announcing. He'll have Vice President Joe Biden with him. That the U.S. and Cuba are reopening their embassies. These embassies will be located, of course, in Washington and Havana. They will be located in their existing offices of the U.S. special interest section in Havana and the Cuban interest section here in Washington.

[11:00:12] The Cubans, as a matter of fact, just recently installed a flagpole that they'll be raising the Cuban flag at.