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Early Start with John Berman and Zoraida Sambolin

Cruz Names Carly Fiorina As VP Pick; Major Downsizing For Sanders' Campaign; World Responds To Trump Foreign Policy Speech; Source: Pills Found On Prince At Time Of Death; Dennis Hastert Sentenced To 15 Months; Feds: We Did Send Bankers To Jail. Aired 5:30-6a ET

Aired April 28, 2016 - 05:30   ET

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


[05:30:00] JOHN BERMAN, CNN ANCHOR: But he did mock what Ted Cruz is doing.

(BEGIN VIDEO CLIP)

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: He has set a record, though. He is the first presidential candidate in the history of this country who's mathematically eliminated from becoming president, who chose a vice presidential candidate, OK? It's a record.

(END VIDEO CLIP)

BERMAN: CNN's Sunlen Serfaty has the latest from the Cruz campaign in Indiana.

(BEGIN VIDEOTAPE)

SUNLEN SERFATY, CNN NATIONAL CORRESPONDENT: Good morning, John and Christine. Well, Sen. Cruz making another Hail Mary pass, making the very unusual move to name his vice presidential pick before he is even the nominee. A move very widely seen as one that was intended to refocus attention on his campaign after a string of bruising losses.

Now, the move was met with immediate criticism from front-runner Donald Trump, who said that this is just a sign of desperation on the part of the Cruz campaign, and said that Sen. Cruz should not even be wasting his time choosing a VP, given that he has no mathematical path forward towards the nomination without a contested convention. Senator Cruz addressed that criticism head-on in his announcement speech. Here's what he had to say.

SEN. TED CRUZ (R-TX), PRESIDENTIAL CANDIDATE: It's tradition that a vice presidential nominee is announced at the convention. It is unusual to make the announcement as early as we're doing so now. And I think all would acknowledge this race, if anything, is unusual.

SERFATY: Meantime, Carly Fiorina also addressed Donald Trump's criticism. The fact that Donald Trump was bringing up her past criticism when she was rivals with Ted Cruz. Statements that she made in the past saying that Ted Cruz will do anything and say anything to get elected. I asked her about that. Here's how she responded. CARLY FIORINA, TED CRUZ'S VICE PRESIDENT PICK: Well, of course, Donald Trump would do that. And the guy who practices saying anything to get elected is actually Donald J. Trump because all of the stuff he's talking about now -- I'm going to fight the system. He's not going to fight the system. He is the system. He's benefitted from the system all of his life. So, you know, see you out on the campaign trail, Donald.

SERFATY: And Sen. Cruz and Carly Fiorina will hit the campaign trail together today. They'll be barnstorming the state of Indiana together. This state certainly holds an oversized importance for their campaign now. The stakes have been significantly raised. John and Christine --

(END VIDEOTAPE)

CHRISTINE ROMANS, CNN ANCHOR: All right, Sunlen.

BERMAN: I already see they have the new signage even already. The Cruz-Fiorina sign.

ROMANS: Oh, yes. Oh, yes.

Joining us to discuss Donald Trump's foreign speech and Ted Cruz's pick for veep, as well as the big shakeup in Bernie Sanders' campaign, CNN politics managing editor Zach Wolf is back with us this morning. So nice to see you again this morning. I guess, let's talk about the timing of this move from Ted Cruz, really try to get some juice into a campaign that -- he's running a distant second.

ZACHARY WOLF, CNN POLITICS, MANAGING EDITOR: Yes, a distant second. He has no path to get the nomination until there's a contested convention. Usually, people pick a vice presidential nominee when they're headed into the convention. It's a sign of momentum to propel them out into the general election.

For Ted Cruz, I think there's a good chance, even maybe a probability, there isn't going to be a general election. So why is he doing it now? He just wants to change the conversation, I think, from losing five states on Tuesday to get everybody talking about this right now and not delegate math. So, maybe he did OK in that regard.

BERMAN: You heard Donald Trump criticize the pick, though not Carly Fiorina. He was careful, actually, not to criticize Carly Fiorina after the complicated relationship they had in the fall during the primaries. The pick also got some criticism from the Democrats last night. Barbara Boxer, who defeated Carly Fiorina in a Senate race some years ago -- Barbara Boxer put out a tweet. I think we have that. We can show it to you. Barbara Boxer said "Slogan idea for the Cruz/Fiorina 'ticket': Mean & Meaner."

I suppose unsurprising reaction from someone who campaigned against Carly Fiorina but look at the glass half full side of it. What would Carly Fiorina -- what does she add to the Cruz campaign? Why does Ted Cruz seem so fond of her, politically speaking? WOLF: She has some experience going after Donald Trump. She's a woman. I think that helps, especially after Donald Trump's comments about the woman card the other night. She, effectively, faced him down a couple of times on the campaign stage. She's been at his side. She's really been out there, loyal to Ted Cruz ever since she endorsed him.

So she does bring a lot, and she does bring name recognition in California, although she didn't win that race. People have seen her on the ballot there before and she did win a very tough primary there in her Senate race in 2010. So, I guess those could be glass half full things if you wanted to look at it that way.

ROMANS: Donald Trump had a speech yesterday. They billed it as a major foreign policy speech, trying to weave together these months of soundbites about America losing and other countries not playing fair, and try to really put some policy meat on the bones. Let's listen to what he said about how "America First" will be his theme. Listen.

[05:35:00]

(BEGIN VIDEO CLIP)

TRUMP: "America First" will be the major and overriding theme of my administration. We're getting out of the nation-building business, and instead, focusing on creating stability in the world. Our moments of greatest strength came when politics ended at the water's edge.

(END VIDEO CLIP)

ROMANS: He went on to just bash the Clinton and Obama worldview. He tied them together, saying it's just sewn confusion around the world. Was there a lot of policy in this speech in your view?

WOLF: I don't think there were a lot of details. He's said a lot of this stuff before. He tied it all together, in a way, and if you wanted to look for a theme its existing alliances are going to be reexamined and maybe new alliances are going to be formed. He said nice things about Russia and, despite trade, he said we should be changing the way we look at China.

And then he also talked about how in Europe, and Asia, and the Middle East, the countries that we work with now, need to pony up in some ways and contribute more to their own defense. So, it would be a major -- if anybody needed a reminder that a Donald Trump presidency could change things, this would be a total realignment of American foreign policy from him.

BERMAN: Interesting moves on the Democratic side of the race. We heard late yesterday Bernie Sanders laying off hundreds of campaign workers, hundreds of staff. Very, very big cutback in the campaign. The Sanders' team says it's just a natural progression. There are fewer states on the map. They don't need as many people to run them. But, it does seem like this is a bit of a reaction to the string of defeats he suffered recently. WOLF: That's right, he could have some good nights later on in the contest. They said they're refocusing out west on those states that are still yet to come. But it doesn't seem in a lot of ways, if you're looking towards November and a general election, you're going to need people organizing in those states that you've just won in.

So, it's hard to see what's going on with the Sanders campaign. They say they're going to carry it through until the last vote is cast and those votes are out west, so I guess that's where they're going to have to focus now.

ROMANS: All right, Zach Wolf. Nice to see you this morning.

BERMAN: All right, Zach, thank you.

ROMANS: Bright and early, bright and early.

BERMAN: Big morning on "NEW DAY". Carly Fiorina, the newly-minted running mate for the second place Republican right now. She is on "NEW DAY" during the 7:00 hour. You don't want to miss that.

ROMANS: All right, Donald Trump putting America first in his first big foreign policy speech. We've got new reaction from around the world, next.

(COMMERCIAL BREAK)

[05:42:00] ROMANS: All right, Donald Trump -- we've been telling you about this -- laying out his aggressive global blueprint in his new foreign policy speech, accusing China of economic assault on America. Proposing an olive branch for Russia and vowing to take down ISIS. We've got new reaction coming from around the world.

I want to bring CNN's Nic Robertson in London, Frederik Pleitgen in Moscow, Will Ripley is in our Tokyo bureau. A dream team of analysis here this morning for that Donald Trump speech. Thanks, guys.

Will, let me talk to you first. We've covered this for some time, these soundbites from Donald Trump, specifically about trying to -- where he says that China is unfair, that China is cheating. The United States should have the power to be able to change China's behavior. He's talked about slapping tariffs on goods made in China. He's almost promised a trade war to reset the table. What is the reaction this morning from China on his comments yesterday?

WILL RIPLEY, CNN INTERNATIONAL CORRESPONDENT: The reaction, publicly, is that they believe that whoever is elected U.S. president, the dynamics of the very complicated U.S.-China relationship, both trade and otherwise, will remain pretty much the same, although state media has blasted Donald Trump, saying that his proposals are ridiculous and would have disastrous consequences.

You can't talk to an economist -- you know this, Christine -- that will tell you that a trade war is a good thing for any economy because if the U.S. starts taxing Chinese imports and China starts taxing U.S. exports, the next thing you know both economies could potentially hit a recession. That's what a lot of economic meters here are fearful of.

Other economies in the Asia-Pacific region, U.S. friends, could also be affected. There could be job losses. There could be a global recession. And that's not even taking into account the military situation with China's increased assertiveness and the potential ramifications of economic problems and how that could also impact their military policies, as well.

BERMAN: A lot of Donald Trump's criticism of the Obama foreign policy, or the Obama-Clinton foreign policy, fairly traditional Republican criticism. The one area he diverges from that orthodox, and really any other, is his seeming willingness to engage in outreach to Russia and Russian president Vladimir Putin. Listen to what he said about that.

(BEGIN VIDEO CLIP)

TRUMP: Some say the Russians won't be reasonable. I intend to find out. If we can't make a deal under my administration -- a deal that's great, not good, great for America but also good for Russia, then we will quickly walk from the table. It's a simple as that.

(END VIDEO CLIP)

BERMAN: If we can, I'd love to get the Russian reaction, Fred, from you, who is in Moscow. And then, Nic, what the Europeans are saying about this because this will affect them. So Fred, you first.

FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes, absolutely. The Russians very happy, of course, about what Donald Trump said here. John, one of the things that the Russians have been trying to do ever since 2014, really, is they want the sanctions against them to be lifted. The ones that have been in place since they annexed Crimea.

[05:45:00] And one of the things that the U.S., under the Obama administration, keeps saying is look, hey, we can talk about the sanctions going way. But first of all, you've got to stop meddling in Ukrainian affairs and you have to give Crimea back.

Now here comes Donald Trump, in his speech, saying he wants new outreach towards Russia. He believes that there could be friendship between Russia and the U.S. and he doesn't even mention Ukraine, so that's certainly something that the Russians will have been pleased to hear.

The other major thing that he said is that he said look, the Russians have also felt the impact of terrorism on themselves which is something that some people read as meaning that he believes that the Russians and the U.S. could work more closely together to fight ISIS, which right now the Obama administration is quite reluctant to do because of Russia's support for Bashar al-Assad.

It's no secret that President Putin and Donald Trump have both expressed, at least somewhat, an admiration for one another so certainly it seems as though these two gentlemen believe that they could work with each other.

ROMANS: You know, Nic, the critics of Donald Trump in the U.S. says that he has not thought deeply or for very long about foreign policy. That he'slearning this as he goes along. We heard from Sen. Lindsey Graham who tweeted he's no fan of Donald Trump by any stretch of the imagination but they share a party.

I'm not sure who is advising Trump on foreign policy but I can understand why he's not revealing their names. Madeleine Albright, who is someone who supports Hillary Clinton, also with just some scathing analysis of Donald Trump. "Trump demonstrates no real understanding of complex international issues. Has no serious proposals."

What is the international reaction about Donald Trump as he gets closer to the nomination and the potential to actually have the big job in the White House? From the international perspective, Nic, is there a feeling that he is a serious student of foreign policy?

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: No one's coming out and saying that right now. The reaction has sort of been anything but. A few months ago you had the British prime minister here, David Cameron, calling Trump's comments about banning Muslims traveling into the United States. He said that was divisive, wrong, and stupid.

Just last week David Cameron had the opportunity to roll that statement back. He said he was neither going to add to it nor take away from it. The perception, I think, certainly is the numbers are beginning to add up in Trump's favor. That is recognized in capitals throughout the world but there was little detail yesterday that could give them substance to hold onto but plenty for them to worry about.

Here in Europe, the NATO allies of the United States -- they hear Trump talking about the NATO partners have to pay their way. He wants to remake a relationship with Russia. The perception in NATO, and this comes from the military commanders of NATO -- U.S. generals believe that Russia is the biggest threat to Europe.

That's where we're seeing an influx of American fighter planes into Romania, U.S. troops on the ground. NATO, in Eastern Europe, bolstering the defenses of those countries concerned about Russia. So the European allies look at this thin straw through details and find it contradictory. On the one hand, reaching out to Russia which doesn't really seem to fit anyone's thinking of geopolitics right now. So you have to say there's caution and concern, and perhaps not a small of worry there, too.

ROMANS: All right, caution, concern, not a small amount of worry. Guys, thank you so much for your analysis. I'm sure we're going to be talking about this in the days and weeks ahead. Thanks, guys.

All right, time for an EARLY START on your money.

Global stock markets selling off. We've got a sell-off underway here folks. Dow futures are lower. Look, 154 points lower. Investors unhappy about a bunch of bad corporate earnings. Oil down slightly. European stock markets -- they're lower and steepening those losses. Take a look at that huge drop in Tokyo overnight. Its central bank said no to more stimulus.

Corporate earnings season, in one word, terrible, except for Facebook. The social network says profits surged 200 percent from this time last year, revenue up 52 percent. Facebook's reach gets bigger, 1.65 billion people use Facebook each month. That's an important metric for social media companies.

Facebook stock is up 4 percent this year. It's jumping out of a 9 percent free market. See the cone-shaped rise and fall you're seeing? It came after its last earnings report, so if you own Facebook you're probably in for a big day of gains. If you own a lot of other tech companies, I'm sorry.

BERMAN: I think some of the 1.6 billion of you on Facebook should like my page. Just saying. There are enough of you out there. Let's take a look at what's coming up on "NEW DAY". Alisyn Camerota, who loves my page, joins us now.

ALISYN CAMEROTA, CNN ANCHOR, "NEW DAY": How many times have I said that, John? Thank you guys very much. Let me tell you what's coming up on "NEW DAY". Donald Trump, of course, unveiling his foreign policy plan in a major speech. Well, the critics have not been kind so we're breaking that down. What was in it? And we're also talking with his campaign about it.

Also, Ted Cruz naming his running mate, Carly Fiorina. Why now? We have the perfect person to ask. Carly Fiorina will be live in our 7:00 hour to talk all about that. Plus, we're hearing from the youngest survivor of that mass shooting in Kalamazoo, Michigan back in February. We're going to look at her heartbreaking story and her amazing recovery.

[05:50:00] So we have a lot to get to in 10 minutes when we see you on "NEW DAY".

ROMANS: All right, thanks, Alisyn.

Breaking news overnight. New information on Prince's death investigation. Was the music icon addicted to prescription painkillers?

(COMMERCIAL BREAK)

[05:54:00] BERMAN: Breaking overnight, a source tells CNN that Prince had opioid medication on him at the time of his death. A law enforcement official says the prescription pills were also found inside his Minnesota home.

The source says that Prince was treated for a potential overdose of pain medication a week before he died. Investigators have brought in the Drug Enforcement Agency to help with this probe. An official cause of death has not yet been released. Investigators are still waiting on the autopsy and toxicology reports. ROMANS: New calls this morning to eliminate the statute of limitations on child sex crimes. Illinois attorney general Lisa Madigan making that case. It comes the day after former House speaker Dennis Hastert was sentenced to 15 months in prison in a federal hush money case.

[05:55:00] He pleaded guilty Wednesday to violating banking laws while trying to pay a man millions of dollars to conceal sex abuse. Prosecutors say that abuse happened decades ago when Hastert was a teacher and a wrestling coach. They say too much time had passed to bring charges for the abuse, itself.

BERMAN: The man who admits opening fire inside a Colorado Planned Parenthood and killing three people will be in court this morning. The hearing will focus on Robert Dear's mental health. A doctor who conducted the 57-year-old's competency exam and also a police detective may testify. During outbursts in court, Dear has declared himself a warrior for the babies. He also said he was guilty.

Tennessee now has a new law on its books. The critics are slamming its anti-LGBT. The legislation allows counselors to refuse to treat patients based on the counselor's religious or personal beliefs. The state's governor says he supports the measure. He says it requires therapists to help people who are in imminent danger to themselves. It also requires them to give patient referrals to other counselors. Critics say, though, it just makes it harder for gay and transgender patients to get help.

ROMANS: Let's get an EARLY START on your money this morning. Dow futures are lower -- a lot lower. Investors awaiting another round of corporate earnings news, most of them disappointing. Oil is down just a little bit here, but stock markets in Europe are adding to losses here. Also some gloom in Japan. Its central bank announcing it won't do any more to stimulate the economy. That sent shares in Tokyo down more than 3 percent overnight, so look for a sell-off this morning.

Great news for travelers. Airfares are dropping. The average domestic ticket fell to $363 in the fourth quarter of last year, the lowest since 2010, an 8.3 percent annual drop. It's probably because of the crash in oil prices. Analysts, though, say airlines base their prices on profit, not on oil, so depressed fuel prices take some time to trickle down to consumers. That means even lower fares could be on the way. Experts say increased competition from low-cost carriers is forcing airlines to match those low prices.

A government group says it is a myth that no bankers went to jail following the financial crisis. The watchdog group overseeing the government's bailout funds says 35 bankers have been sentenced to prison. That was included in a report sent to Congress yesterday. More than $400 billion in troubled asset relief program funds were distributed to banks that were in danger of failing during the financial crisis.

The TARP inspector general has been prosecuting cases of fraud in the use of those funds. Many of the crimes involved relatively small amounts of money in smaller banks rather than massive fraud at Wall Street banks. The inspector general says her office is still investigating hundreds of cases.

BERMAN: All right, a lot going on in the presidential race. New reaction to Donald Trump's big foreign policy speech. New reaction to Ted Cruz's new running mate, including from that running mate herself. "NEW DAY" picks up right now.

(BEGIN VIDEO CLIP)

TRUMP: Our foreign policy is a complete and total disaster. Weakness, confusion, and disarray.

CRUZ: An extraordinary leader and the next vice president of the United States, Carly Fiorina.

FIORINA: This is the fight of our time.

TRUMP: Cruz can't win. What's he doing picking vice presidents?

BERMAN: Bernie Sanders laying off hundreds of campaign workers.

SEN. BERNIE SANDERS (I-VT), DEMOCRATIC PRESIDENTIAL CANDIDATE: I am very good in arithmetic and we are behind.

UNIDENTIFIED MALE: Local authorities found prescription opioid medication on Prince. They want to know where these medications came from.

UNIDENTIFIED MALE: We are way too cavalier with the prescribing of these medications.

(END VIDEO CLIP)

ANNOUNCER: This is NEW DAY with Chris Cuomo, Alisyn Camerota, and Michaela Pereira.

CHRIS CUOMO, CNN ANCHOR: Good morning. Welcome to your new day. It's Thursday, April 28th, 6:00 in the east. Up first, Donald Trump outlining his foreign policy plan with a very blunt message, America comes first. His doctrine was admittedly thin on details, drawing a negative reaction across the political spectrum.

While that was going on, Ted Cruz was trying to get some attention of his own by announcing his running mate, Carly Fiorina. Will it make a difference with voters in Indiana? We're going to speak live with Carly Fiorina in our 7:00 hour and she can tell you for herself.

CAMEROTA: On the Democratic side, Bernie Sanders' campaign begins laying off hundreds of workers. What is Bernie's path forward now? We have the 2016 race covered the way only CNN can. Let's begin with CNN's Phil Mattingly. He is live in Washington for us. Good morning, Phil.

PHIL MATTINGLY, CNN CORRESPONDENT: Good morning, Alisyn. For weeks, it has appeared Donald Trump has been struggling with who exactly he wants to be on the campaign trail. The boisterous showman who has electrified thousands at his rallies, or a dealmaker, who behind the scenes is a respected statesman. Over the course of 12 hours, yesterday, it became very clear. He has not made up his mind yet.

(BEGIN VIDEOTAPE)

MATTINGLY: A tale of two Donald Trumps.

TRUMP: We're just about ready to put it away, folks.