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Clinton Tackles Economy in First Police Speech; Scott Walker to Join GOP Field for 2016; Deal in Iran Talks Imminent; Miss USA Crowned Amid Trump Controversy; Deal Reached on Greek Bailout; Mexican Drug lord El Chapo Escapes Prison; Aired 10-10:30a ET

Aired July 13, 2015 - 10:00   ET

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

[10:00:00] SEN. BOB MENENDEZ (D), NEW JERSEY: What a deal looks like is incredibly important.

SEN. MITCH MCCONNELL (R), MAJORITY LEADER: I think it's going to be a very hard sell for the administration.

CAROL COSTELLO, CNN ANCHOR: Also, the most powerful drug kingpin on the planet busts out of prison.

UNIDENTIFIED FEMALE: This particular prison is considered to be the most secure prison in Mexico.

COSTELLO: How did he get out? Did he have help? And how America is helping track him down.

Hillary Clinton talking dollars and cents this hour. Her big theme, give everyday Americans a raise. How will it play?

Let's talk. Live in the CNN NEWSROOM.

(END VIDEOTAPE)

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

We begin this morning here in New York where Hillary Clinton will stake her claim on the economy in her first major policy speech of the 2016 campaign. Clinton expected to make her pitch for boosting middle class wages. The speech coming as she fights a mounting challenge on her left in the form of Vermont senator and self-described Democratic socialist Bernie Sanders.

Our senior Washington correspondent Jeff Zeleny is at the New School in Manhattan, which is the site of Clinton's speech.

Good morning, Jeff.

JEFF ZELENY, CNN SENIOR WASHINGTON CORRESPONDENT: Good morning, Carol. You're right, Secretary Clinton is about to give the first policy speech of her campaign. Not surprisingly it's squarely focused on the economy, in particular, how she will propose to raise the wages for middle class Americans, closing the expanding sort of gap between rich and poor in America. She'll do it in a couple of ways, I'm told. One, she will urge

companies through tax incentives to give profit sharing to employees. She will say that all employees should be benefiting in some of the record-setting profits that these companies have had. She will also call for the creation of American infrastructure bank. That would be a public-private partnership to really create some well-paying jobs across the country.

And, Carol, she will also call -- really amplify her call for increasing the minimum wage as well as expanding family leave and paid medical leave. These are central tenets of her Democratic philosophy. Of course she is being challenged on the left from Senator Bernard Sanders but don't expect much talk about that today. She will be focused on Republicans. She will be distinguishing herself from Republican candidates in this race and this is her first policy speech of many policy speeches coming up -- Carol.

COSTELLO: I know. I notice your voice is lowered so the event has begun. I'll let you get to it.

Jeff Zeleny, many thanks to you.

CNN will monitor Clinton's speech and bring you the highlights a little later this hour.

OK. So on the Republican side Scott Walker is poised to officially kick off his campaign later today. The Wisconsin governor unveiling his bid just a day after signing his state's budget into law. Like Hillary Clinton, Walker has attempted to strike a populist tone but in a very different way.

Here now to talk about that is CNN political reporter Sara Murray. She's in Wisconsin.

Sara, Scott Walker just signed Wisconsin's budget into law last night hours ahead of his formal announcement. Some elements, freezing in state tuition, imposing no sales or income tax increases. No doubt these were also designed not only to appeal to Wisconsin but to the masses as well.

SARA MURRAY, CNN POLITICAL CORRESPONDENT: Yes. I think that's absolutely right. You know, he tried to do a couple things that would make him look like sort of a populist conservative like you said. I think the freezing tuition rates was a very shrewd move. But the other side of that are some very conservative things that are still in that budget. He cut university funding by about $250 million. He's not allowing a bunch of funding to go to some conservation groups.

So we're still sort of seeing the conservative principled side of Scott Walker as well as the populist he wants to project. And I think we're going to see a lot of that from him on the campaign trail. He likes to talk about how he shops at Kohl's. He likes to sort of be the Midwestern guy. When he held an event in Iowa he was serving beer and cheese curds. So I think that's really the image he wants to project if he starts to hit the road after this announcement. COSTELLO: And, of course, that image comes kind of natural to him

because that's the kind of guy he is. What doesn't seem to come natural to him is when he talks about national security and foreign policy. He's known to have made a number of gaffes. Here is one of them.

(BEGIN VIDEO CLIP)

GOV. SCOTT WALKER (R), PRESIDENTIAL CANDIDATE: I want a commander-in- chief who will do everything in their power to ensure that the threat from radical Islamic terrorists do not wash up on American soil. We need a leader with that kind of confidence. If I can take on 100,000 protesters, I can do the same across the world.

(END VIDEO CLIP)

COSTELLO: Of course he was talking about protesters in Wisconsin and comparing them to ISIS, which wasn't the most apt comparison.

MURRAY: Yes. Carol, I think that was a moment that gave a lot of Republicans pause, including a lot of Republican donors who are still kind of weighing whether they want to get behind a Scott Walker candidacy. And it was sort of after this moment, after a couple other kind of misstep moments that they brought Scott Walker back to Wisconsin and said, it's time to buckle down. We're going to work on some policy briefings, we're going to sort of build this campaign infrastructure and make sure we know what we're doing before we get back out there on the national stage again.

[10:05:02] Now when I talked to his advisers, they say that he is ready, he's prepared to hit the trail. He's prepared to answer these foreign policy questions, and so I think that's something we'll see over the next week or so is how he handles this when he is being questioned on a regular basis.

COSTELLO: All right. Sara Murray reporting live from Wisconsin for us this morning. Thanks so much.

After months of talks we could now be on the verge of a breakthrough in a nuclear deal with Iran. Western diplomats tell CNN that a deal appears imminent and could be announced at any time.

Elise Labott is CNN's global affairs correspondent. She joins us now with more.

Good morning. And also with the White House -- I don't want to forget about you, Michelle Kosinski. We'll get to you in just a bit but let's start with you, Elise.

ELISE LABOTT, CNN FOREIGN AFFAIRS REPORTER: Good morning, Carol. Well, diplomats are saying they're on the verge of a deal. There's still some last-minute discussions that are taking place. Negotiators say they've made a lot of progress over the weekend but still some important issues need to be resolved.

We're talking about sanctions now. The Iranians want to see a lifting of the U.N. arms embargo, particularly a lift on the ban on ballistic missiles. They also were talking about access to Iranian military sites by international inspectors from the U.N., and this is one of the real sticking points. Iran very hesitant to allow IAEA inspectors on those military sites.

And also about the pace and scope of the additional research and development, Iran's nuclear technology they can do during the ration of a deal. And then answering lingering questions about Iran's previous nuclear weapons program. They call it military dimensions, PMD. Was Iran trying to build a nuclear weapon?

Now we understand that there is an agreement in principle, and now we're talking about wording, Carol, of this 100-page document, poring over every word, and every time either the Iranians or the U.S. or one of the parties in the deal wants to change one word, it takes on a whole new meaning. So while they may have agreement on the big sticking points, these very small details are still very important to reaching final agreement which then needs to go to all of the capitals, Iran and the six nations negotiating, and then we hope to have an announcement maybe later today, possibly by tomorrow, Carol.

COSTELLO: OK. So they're ironing out all those small details. It's tedious work, but you know what? Even if they do reach an agreement later today, Congress has a say in this so let's switch over to Michelle Kosinski and talk to her about that.

Some lawmakers aren't even waiting to see the final plan. They're just saying that, you know, this does nothing to strengthen America's presence in that region.

MICHELLE KOSINSKI, CNN WHITE HOUSE CORRESPONDENT: Right. Of course, now, Carol, we've been hearing that for months. When you look at this, I mean, if a deal is finalized, hopefully very soon, I mean, they've been working on this for such a long time. With everything that's gone into this, is it going to be a done deal?

Well, because we have the P5 Plus 1 and we have these not just months but years leading up to this, most likely yes, but there is still a process to go through here because, as you mentioned, Congress does have a say, and also, yes, some in Congress, especially Senate Republicans, have not exactly held back in speaking out against a deal. Among other things they want to make sure that Iran is left with no nuclear capability. Listen.

(BEGIN VIDEO CLIP)

SEN. LINDSEY GRAHAM (R), PRESIDENTIAL CANDIDATE: Getting a bad deal with Iran is the worst possible outcome because it's going to start a nuclear arms race and under the agreement they're talking about you're ensuring they're going to become a nuclear power. The goal was to dismantle their program. Now we're going to lock it in place.

MENENDEZ: It makes me anxious because what a deal looks like is incredibly important, and the problem here, George, is that we have gone from preventing Iran having a nuclear ability to managing it. MCCONNELL: I hope there will be enough Democrats willing to look at

this objectively. Look at the facts. Is this a good deal? Is this likely to achieve the outcome we had hoped for?

(END VIDEO CLIP)

KOSINSKI: And the White House holds that Iran poses a bigger threat without this nuclear deal. So here is what happens now. I mean, according to that bipartisan bill, remember that, that passed into law back in May, Congress can do this. There's a 60-day review period once a deal -- if a deal, maybe we should say, is finalized. And during that time the administration also has certain obligations to Congress. They have to provide them with various forms of information, kind of reporting in.

They can't lift particular sanctions against Iran, and then after that Congress can vote approval or disapproval and it's actually not even approval on the deal itself but on whether Congress is going to lift the sanctions that Congress itself imposed.

Now, of course, the White House -- you know, if Congress voted to leave sanctions in place, the White House is going to veto that, and if Congress wants to override the veto, that's going to take a two- thirds majority in both Houses, and that's the thing that could be extremely difficult if not impossible. And they would have to have so many Democrats on board.

[10:10:03] So you can see, though, that even though this is not technically an up-or-down vote on the deal that Congress has, you can see how it could work that way if they vote to keep sanctions in place against Iran and that's one thing that Iran was saying was going to be a no deal, if sanctions were left in place, but that, again, would require Congress to override a presidential veto -- Carol.

COSTELLO: Let's see what happens. Michelle Kosinski, reporting live from the White House this morning. Thank you.

A bailout deal for Greece is now in the hands of the country's parliament after marathon talks that dragged on for 17 hours. Eurozone leaders agreed to give Greece as much as $96 billion in fresh loans, but that's only if Greece can implement serious reform.

Wall Street has rallied on the news. Right now the Dow is up, as you can see, just about 182 points. A live report with reaction from Athens, that's just ahead in just a few minutes.

Still to come in the NEWSROOM, a notorious drug lord on the run once again. How he pulled off his second elaborate escape.

Plus Donald Trump bows out of the Miss USA Pageant after weeks of controversy? Up next, we'll tell you what he was doing over the weekend instead.

(COMMERCIAL BREAK)

[10:15:45] COSTELLO: It was a night of glitz and glamour at the Miss USA Pageant in Baton Rouge.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: 2015 is -- Oklahoma.

(END VIDEO CLIP)

COSTELLO: But one famous face was missing on Sunday night and you guessed it. Pageant co-owner and presidential hopeful Donald Trump was a no-show, but that doesn't mean it was a low key weekend for the real estate mogul. Trump delivered a fiery campaign speech in Phoenix on Saturday. Listen to how he responded when he was interrupted by protesters.

(BEGIN VIDEO CLIP)

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: I wonder -- I wonder if the Mexican government sent them over here. I think so.

(CHEERS AND APPLAUSE)

TRUMP: Because I'm telling you, I tell about the bad deals that this country is making. Mexico, I respect the country. They're taking our jobs. They're taking our manufacturing. They're taking our money. They're taking everything, and they're killing us on the border, and Mexico does not like it. So remember this -- don't worry, we'll take our country back very soon. Very soon.

(END VIDEO CLIP)

COSTELLO: Trump, as you well know, has been at the center of controversy for weeks now after making racially charged comments about Mexicans.

Let's bring in CNN's Athena Jones. She's live this morning from Baton Rouge.

Good morning.

ATHENA JONES, CNN CORRESPONDENT: Good morning, Carol. You saw the big crowd that Trump appeared before over the weekend in Phoenix, Arizona, but one big crowd he didn't want to appear in front of is the crowd here last night at the Miss USA Pageant. Trump had said as recently as a couple of weeks ago that he planned to come to this pageant which he partly owns, as you mentioned, to support the contestants, but on Saturday, a day before it was to take place, he said on Twitter that he wasn't going to be able to come because he was campaigning in Phoenix.

We, of course, asked his campaign what events he had in Phoenix. We were told he had no official events on Sunday. But as you know, the Miss USA Pageant was caught up in the firestorm after Trump called some Mexican immigrants crossing the border into the U.S. rapists and killers.

I asked the new Miss USA whether Trump's -- whether the controversy surrounding Trump overshadowed the event. Here is what she had to say.

(BEGIN VIDEO CLIP)

OLIVIA JORDAN, MISS USA 2015: I think that this has been an incredible year and that we were able to come together. It was probably difficult -- more difficult circumstances than we've had in the past but the Miss Universe organization came together and they put on an amazing show. Reelz Channel really swept in and saved the sash as they were saying. And I'm very grateful for all the women that came together. And we stood strong and we all made sure to share our own beliefs and be strong in what we believed and be ourselves on stage.

(END VIDEO CLIP)

JONES: And also Olivia Jordan said that the Miss Universe Organization which runs the Miss USA Pageant is bigger than one person. She also referred to Reelz, the cable channel that stepped in after Univision and NBC dropped plans to air the broadcast in protest at Trump's remarks. Of course Reelz being on cable reached a far, smaller audience.

And one more thing I should mention, Carol, the -- the second place finisher was Miss Texas who was a 22-year-old Mexican-American who grew up on the Texas-Mexico border -- Carol.

COSTELLO: All right. Athena Jones, reporting live for us from Baton Rouge this morning. Thank you.

Donald Trump's antics apparently have David Letterman rethinking retirement. Letterman appearing on stage on Friday with Steve Martin and Martin Short in San Antonio telling the audience the end may have come too soon.

(BEGIN VIDEO CLIP)

DAVID LETTERMAN, FORMER TV HOST: I was complacent, I was satisfied, I was content, and then a couple of days ago Donald Trump said he was running for president. The biggest mistake of my life, ladies and gentlemen. Number 10, that thing on his head was the gopher "Caddy Shack." Number nine, during sex Donald Trump calls out his own name. And the number one interesting fact about Donald Trump, thanks to Donald Trump, the Republican mascot is also an ass. There you go.

(END VIDEO CLIP)

[10:20:06]

(COMMERCIAL BREAK)

COSTELLO: Take a look at the big board. The Dow is up nearly 200 points rallying on news of a bailout deal for Greece that could give the cash-strapped country as much as $96 billion in fresh loans.

European leaders spent 17 hours hammering it out. The agreement would keep Greece in the Eurozone, but it's not a done deal just yet. The Greek government still has to implement serious reform so let's head over to Athens. CNN's Isa Soares is there.

Good morning.

ISA SOARES, CNN CORRESPONDENT: Good morning, Carol. You're quite right. Alexis Tsipras has his work cut out for him. He's already made his way to Athens. He is here and he is basically saying that its hard work ahead but he believes these are the best measures, the best possible chances for his people because they want to stay in Europe, and that was his mandate. His mandate was to push back on austerity but not risk Greece's position in the Eurozone.

[10:25:10] So he has 48 hours, Carol, just until Wednesday to push through these tight reforms, these core sets of reforms, which includes more tax hikes, also includes pension reforms which if you remember were huge red lines.

In terms of whether he will get the backing, well, there are some dissenters within his own party, Syriza Party, so he may lose the support of the Syriza, the majority, of course, from the Syriza Party, but there is seems to be some support from opposition groups because they're the ones that were saying why were we calling for referendum? Why are we risking Greece's place in the Eurozone? Today were saying that they will support Alexis Tsipras.

Now the concern turns, Carol, to the banks. Whether the banks will have enough money. We heard today from the European Central Bank, they're the ones who have been flooding the market, flooding banks in Greece with money. They've been pretty much the lifeline for Greek banks. They said today they will not increase the liquidity to Greece banks, clearly putting more pressure on Alexis Tsipras for that parliamentary vote to go ahead, before making any decisions as to whether Greek banks will have more money. In the meantime, bank are closed. Capital controls are still in place -- Carol.

COSTELLO: All right. Isa Soares reporting live from Athens, Greece this morning.

An intense international manhunt is under way right now for a man U.S. officials describe as one of the world's most violent drug lords. Known as El Chapo, Joaquin Guzman is a cold-blooded killer who reigns over a top global multi-million dollar drug empire. He's been sitting in prison for a year but he is free this morning after pulling off an elaborate prison escape that makes the Clinton prison escape in upstate New York looks like child's play.

Polo Sandoval is in Mexico near the prison where El Chapo broke free. Tell us more.

POLO SANDOVAL, CNN CORRESPONDENT: Tell you what, Carol, the search seems to be intensifying. We've seen federal police on their patrols around the prison facility itself. We're actually just west of Mexico City here and now really the search focusing on an area in and around Toluca, Mexico which is really not far from here.

Now I can also tell you that really the main concern here is that he could have potentially fled to Sinaloa, which is really his home state. It's a very mountainous region and, of course, much, much more of that, plus where he could potentially be hiding and much more coming up right here in the CNN NEWSROOM.

COSTELLO: I just wanted to ask you another question like who is looking for this man? Is the United States involved or other countries involved?

SANDOVAL: We know that -- we know that state, federal, and local officials here in Mexico have obviously been on the hunt, but as well as really U.S. authorities you can bet are keeping a very close eye on the situation here.

You're talking about a man who is not only dangerous but ruthless but also is known for really just some very ruthless, terrible violent killings as per some of our experts.

(BEGIN VIDEO CLIP)

TOM FUENTES, CNN LAW ENFORCEMENT ANALYST: He is a complete savage. What they do and how they do business is based on complete terror in their community. These are people that they killed, journalists, politicians, police officers, corrections officers, and then not just that person, but every member of their family.

(END VIDEO CLIP)

SANDOVAL: And really that's all part of the major concern here for authorities in Mexico, Carol, is they want to track this man down. He's been able to really flee before so they know that this is a man who knows his way around Mexico. He knows his way around Sinaloa, the state of Sinaloa, and of course -- well, the concern there, there are many people who see this man as a sort of a Robin Hood figure, somebody who would be -- people who would be willing to welcome him with open arms and potentially hide him.

So again, the center of the search at the maximum security prison you see behind me but really that search really moving outwards from where we are at this hour -- Carol.

COSTELLO: All right. Polo Sandoval reporting live for us this morning. Thank you.

Checking some of the top stories for you at 29 minutes past the hour. Officials are still trying to figure out what caused an explosion that sent a Rhode Island woman flying onto a pile of rocks. The woman was on this beach when that mysterious blast threw her five feet into the air.

(BEGIN VIDEO CLIP)

LAURA DEMARTINO, SISTER OF INJURED WOMAN: After it happened, it was large gutters of the sand separated. You could actually see crevice like an earthquake. We didn't know. We thought it was an earthquake. We thought the boat hit the rocks on the other side. We didn't know what caused this tremendous eruption.

(END VIDEO CLIP)

COSTELLO: The woman has since been released from the hospital. Police say no explosives or malicious intent was found.

In Illinois two people are dead and two police officers recovering this morning after a wild shootout. The two officers were responding to a 911 call on Sunday when a man with a shotgun walked up and opened fire in the Chicago suburb. A shootout ensued. The suspect was shot and killed. Police then found a man shot to death inside the home where the officers were called to. Both officers will be OK.

We're about to get our first ever up close look at Pluto. NASA officials say --

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