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Obama Retaliates for Russia's Election Cyberattacks; U.S. Aware of ISIS Leader's Movements; Trump Praises Obama's Cooperation On Transition; Major Storm Hits With Snow, Rain & Strong Winds. Aired 5- 6p ET

Aired December 29, 2016 - 17:00   ET

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


[17:00:06] JIM SCIUTTO, CNN ANCHOR: Happening now, breaking news. Punishing Putin. President Obama hits back at Russia for its meddling in the presidential election. But will anything rein in Russia's leader?

Get on with our lives. President-elect Trump dismisses concerns about Russian interference in the U.S. election. Why is he so quick to dismiss Russia's role in those cyber-attacks?

And eyes on ISIS. U.S. officials tell CNN they're aware of ISIS leader Abu Bakr al Baghdadi's recent movements. After years of hunting, is the military getting close to permanently removing him from the battlefield?

Wolf Blitzer is off. I am Jim Sciutto, and you are in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

SCIUTTO: And tonight we are following the breaking news. President Obama ordering a sweeping array of U.S. actions to retaliate for Russian's cyberattacks and meddling in the presidential election. An executive order slaps sanctions on Russia's top two intelligence agencies, plus other companies and individuals.

Also, the U.S. is tossing out some 35 Russian intelligence operatives and closing down a pair of Russian compounds in New York and near here in Washington, D.C.

President says all Americans should be alarmed by Russia's actions. But President-elect Donald Trump is brushing off questions about payback for Russia's hacking and meddling. He's telling reporters it's time to, quote, "get on with our lives."

Also tonight, CNN has learned the U.S. military is aware of ISIS leader Abu Bakr al-Baghdadi's recent movements. Will the military catch up to him before President Obama leaves office?

We'll discuss the breaking news with a member of the House Foreign Affairs Committee. That's Republican Congressman Ted Yoho. And our correspondents, analysts and guests have full coverage of today's top stories. Let's begin, though, with breaking news. CNN's Athena Jones, she is

in Hawaii where President Obama is doing more than vacationing. Tell us more, Athena, about what you're hearing about these retaliatory steps against Russia.

ATHENA JONES, CNN CORRESPONDENT: Hi, Jim.

The White House says Russia should not be surprised by these actions. And they're stressing that the announced moves are not, quote, "the sum total of our response." The administration is also taking covert measures, all of this aimed at delivering one message to Russia: There is a cost and a consequence of their actions.

(BEGIN VIDEOTAPE)

JONES (voice-over): The Obama administration today announced new measures aimed at retaliating against Russia for a series of cyberattacks and a disinformation campaign intelligence officials say was aimed at hurting Hillary Clinton.

In a statement, the Treasury Department named nine entities and individuals now subject to expanded sanctions, including Russia's military intelligence unit and its head, as well as the domestic security service. The State Department following suit, declaring 35 Russian intelligence operatives persona non grata and giving these spies just 72 hours to leave the country.

The government also shutting down two Russian government-owned compounds, one in Maryland and another in New York.

In a White House statement, the president said, "All Americans should be alarmed by Russia's actions," and repeated that the activities "could only have been directed by the highest levels of the Russian government."

These moves come as President-elect Donald Trump continues to dismiss the U.S. intelligence assessment of Russian interference in the presidential election.

DONALD TRUMP (R), PRESIDENT-ELECT OF THE UNITED STATES: I think we ought to get on with our lives. I think that computers have complicated lives very greatly. The whole, you know, age of computer has made it where nobody knows exactly what's going on.

JONES: While Trump has resisted blaming Russia, members of his own party are standing behind the Obama administration, promising to impose additional sanctions in Congress. Senators John McCain and Lindsey Graham on a congressional delegation to Russia's neighboring states, took on Trump's comments.

SEN. JOHN MCCAIN (R), ARIZONA: I agree with president-elect that we need to get on with our lives, without having Russians being effective getting outside influence, especially Vladimir Putin, who is a thug and a murderer.

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: I think most of us, Democrats and Republicans, really believe that Russia is up to no good all over the world. They're trying to break the back of democracies. And if we don't push back against Putin, Iran and China, they could hack into our systems. Today it's Democrats. Tomorrow it could be Republicans.

JONES: Intelligence officials have publicly attributed the cyberattacks on U.S. political groups and individuals, including the Democratic National Committee to Russia.

[17:05:05] Even before the announcement of the U.S. retaliation, Russia promised a response, a spokeswoman for the foreign ministry saying in a statement, quote, "Frankly speaking, we are tired of lies about Russian hackers that continue to be spread in the United States from the very top. And we can only add that, if Washington takes new hostile steps, it will receive an answer."

ERIC SCHULTZ, WHITE HOUSE PRINCIPAL DEPUTY PRESS SECRETARY: We can anticipate a response of some kind. But the truth is that we enjoy the greatest capabilities of any country on earth. That's offensive and defensive. That applies to cyberspace, but it also applies to diplomatic resources, intelligence resources, and tools we have in our toolbox to hold countries accountable, like sanctions.

(END VIDEOTAPE)

JONES: Now, the president has ordered a full review of the hacks, with the results expected before Trump takes office next month. And as for those sanctions, asked how easy it would be for a Trump administration to reverse them, a senior administration official said, "Hypothetically you could reverse, but I don't think it would make a lot of sense" -- Jim.

SCIUTTO: Athena Jones there in Hawaii with the president. Thanks very much.

Also tonight, the first indication in months as to the whereabouts of one of the world's most wanted terrorists. That is the ISIS leader, Abu Bakr al-Baghdadi. Let's go to CNN Pentagon correspondent Barbara Starr.

Barbara, unusual, somewhat, for them to telegraph, the Pentagon to telegraph that they're getting closer to him.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, the Pentagon actually officially not saying anything about this, Jim. But what I can tell you is a U.S. official told me -- and I want to quote this U.S. official directly -- said, "In the last few weeks we've been aware of some of Baghdadi's movements."

So what they're indicating is not that they have real-time intelligence. They don't know where he is by, all accounts, right this minute. Otherwise, they'd go after him. But they have a report that indicates some recent indications of where he might be.

Now, they're not saying whether he's in Iraq or in Syria. You know, both places could be likely. But what they are doing is continuing to watch, gather more intelligence, monitor communications, try and see if they can push this information forward.

If somebody knew where he was a few weeks ago, can you begin to determine who he might have met with, who you might have talked to, where and how he might have moved around, were there couriers that came to meet him? Take all of those bits and pieces, try and move it forward and see if you can establish more information about where he might be right now -- Jim.

SCIUTTO: Of course, it was a courier that led U.S. intelligence to Osama bin Laden.

Other news today: Russia today announcing a new ceasefire in Syria. What worries the U.S. military about that ceasefire?

STARR: Well, that ceasefire is actually supposed to go into effect, of course, as we stand here right now. The U.S. military watching it very carefully, because Iran is part of this, by all indications. And in fact, the Russian foreign minister, Sergey Lavrov, has invited the president-elect to sit down with all the parties after he takes office.

So what happens if President Trump were to decide to sit down and try and have the U.S. be part of this? He would be sitting down with Iran at the very time he also says he wants to rip up the Iranian nuclear agreement. Puts the new president in a very tough spot.

The U.S. clearly hopes, you know, for the sake of the civilians there, that the ceasefire is for real, but it could open up a whole range of political dilemmas -- Jim.

No question. Barbara Starr at the Pentagon, thanks very much.

Let's get the insights now of a member of the House Foreign Affairs Committee. He is with us now. He's Republican Congressman Ted Yoho of Florida.

Congressman Yoho, we appreciate you taking the time.

REP. TED YOHO (R), FLORIDA: Thanks for having me on, Jim.

SCIUTTO: First, Congressman, your reaction to the news. Do you support the actions taken today by the Obama administration in retaliation for Russian cyberattacks?

YOHO: You know, I don't want to defend Russia in -- if they had a hand in this, but I don't support these in the way President Obama is going about this. If Russia is, in fact -- if we can prove without a shadow of a doubt that they were involved in this, messing -- interfering with our democratic process, then yes, they need to be held accountable.

But for President Obama to move unilaterally 20 days before he's out of office without consulting President-elect Trump, I think this is a misstep in foreign policy, but yet it shows the hand that President Obama has had all along. He's had misstep in foreign policies since the beginning. And I just heard you talking about the Syrian ceasefire that Russia brokered. And I think this is a great thing for the Syrian people.

SCIUTTO: Let me ask you this, because I noted the "if" in your premise there. If Russia is determined to be responsible. The fact is, there is a large bipartisan belief that Russia is behind the attacks, setting aside that the U.S. intelligence community has already announced that publicly.

But you had the speaker, Paul Ryan, Republican Speaker Paul Ryan saying today that these sanctions were appropriate and overdue. You had Senator Lindsey Graham and John McCain on this program earlier in the week, welcoming steps against Russia. In fact, Senator Graham telling me that 99 senators, he said, believe that Russia is behind the election hacks.

We have Senator Mitch McConnell just a short time ago welcoming sanctions against Russia. I want to ask you this, because Donald Trump continued again last night to say he doubts that assessment. What evidence does Donald Trump have that that consensus is wrong?

YOHO: That's a good question, and I don't know. You'd have to talk to Mr. Trump straightforward. But you said "if." The October 7...

SCIUTTO: Well, what doubts, then, do you have? If you say "if it's determined Russia is behind it," do you have doubts? And why do you -- why do you have doubts that others do not?

YOHO: I do have doubts. Because the October 17 report that came out said there was conjecture. The report that came out now said there's conclusive reports or information that some of the techniques were used -- that were used and linked back to Russian operatives, but those are fingerprints that could be hacked and taken from somebody else and put into play.

We don't know if Russia is 100 percent behind this. I'm not thoroughly convinced. I haven't read the final report. I've read a summary of it. And until we know that, for this president to move, there's going to be unintended consequences that the next president is going to have to deal with. And then if you look at...

SCIUTTO: Let me ask you a question, because...

YOHO: you said the October statement said conjecture. In fact, it did not. The early October statement from the DHS and THE intelligence community said with confidence they determined Russia was behind it. and, since then, they've now taken these steps.

But in addition to that, keep in mind the track record on identifying authorship of cyberattacks in the U.S. intel community has been pretty good in recent years. They were able to finger cyber-hackers in China that had been hacking the U.S., including by name and pursuing charges against them. In North Korea they were able to establish fingerprints on the attack on Sony.

Why so much doubt? I just want to ask you, because you're expressing the same doubt. I'm not asking you to speak for Donald Trump. Why so much doubt when you have multiple intelligence agencies, multiple Republican lawmakers saying they have confidence this was an attack on the U.S. By Russia?

YOHO: Well, I think it goes back to the report I read today, and it was referencing the one from October, and it says conjectures.

SCIUTTO: I can read it to you. It said confident. It said confident assessment of the U.S. intelligence community.

YOHO: Well, I'm telling you, the one I read said conjectures. And it didn't have it underlined, but I read it several times.

I guess, if you look at some of our intelligence reports from the Bush era, you know, about weapons of mass destruction, all these weapons that are moving around, we found out that not to be true. There is going to be consequences to the actions that this president is setting up. I think, if Russia has done this and if it's conclusive -- 100 percent conclusive, I think there should be some form of -- I don't want to say retribution, but some form of action.

But caution. I want to, you know, use extreme caution here, because we could look at what President Obama did with Prime Minister Netanyahu, when he was funding money through the State Department, $350,000 to Voice One, that interfered with the state's election.

So if we're going to accuse another state of doing the very same thing that President Obama did, we need to be very careful on what we're doing. And this is something that should be in our foreign policy...

SCIUTTO: Are you equating -- that's an odd point to make for an American. Because in effect, it seems you're making a point that Vladimir Putin, frankly, has made. You seem to be equating U.S. political action abroad with a Russian interference in the U.S. presidential election. Are you putting those on equal footing?

YOHO: No, not at all.

SCIUTTO: Are you saying the U.S. is just as bad as Russia, in effect?

YOHO: I think we need to be held accountable for when we are interfering. This goes back to George Washington when he said don't interfere and entangle yourself with other nations. You know, stay on a trade basis.

SCIUTTO: But isn't your job -- is your job as a member of the House Foreign Affairs Committee to hold foreign nations, particularly adversaries, accountable for interference in our election? Or are you saying your job is to hold America accountable for operations abroad? What is your responsibility?

YOHO: Well, my responsibility is to make sure that, No. 1, our foreign policy has a good direction and a definition, which is doesn't right now. It's like a broken compass.

But we also need to make sure, being a legislator in the United States Congress, we need to make sure that we ourselves set a good example and follow that. If we are not following the example that we think is good, that we ought to, how do we expect anybody else to do anything different? It's the same thing growing up and teaching your kids the way to go.

You know, and I think, you know, the examples we've seen of this president interfering with other countries and their politics, it comes back, and it's going to bite us. And I think we have to have very strong policies, very clear, very succinct and direct, of what we're going to do and what we're not going to do.

The other thing is we don't have a cyber-security policy, which I find is unconscionable, of what constitutes an attack or an act of war. We don't have a policy that describes that, and we don't have a policy that says what we're going to do if that does happen.

SCIUTTO: Congressman Yoho...

YOHO: It's something this administration has had eight years to deal with, and they have failed to do it. I look forward to Donald Trump coming in here and straightening this out.

SCIUTTO: Congressman Yoho, just because you referenced the intelligence community statement from October, I have it here, and we'll put it up on the screen, because I'm going to read the very first sentence of that statement, and it is the following: "The U.S. intelligence community is confident that the Russian government directed the recent compromises of e-mails from U.S. persons and institutions including from U.S. political organizations."

That's the first line of the assessment from more than two months ago. Since then, I'm sure they've been doing a lot of digging since then. Why -- I suppose I'm not the only one, because I have spoken with Republican -- like I said, I spoke with two of your Republican colleagues from the Senate earlier this week who are traveling in eastern Europe. I'm not the only one who's confused by the continued reluctance to accept that assessment.

YOHO: Well, you got me at a disadvantage, because I got my iPad here, but I can't access it. Because I read that, too, where it said, "Confident." But then, later on in the report, it said these were -- some of these were conjectures of who was behind this. But I don't want to get into that.

I just want to make sure that, if we're going to accuse somebody, you'd better be willing to back it up. And you'd better be factual when you come out with this statement, because, again, the consequences that we're going to have long-term, all you have to do is look at the Afghan and Iraqi war that started back in 2002 that we're still fighting. And the unintended consequences that this nation will pay for a misstep are too grave to not get it right.

And that's what I am saying is let's get the information. Let's be factual. And if President Obama is 100 percent sure in this, I would have thought he would have had the maturity, the foresight to deal with Donald Trump and bring him into the process, because he's the one that's got to ride this pony after it's been let out of the barn.

SCIUTTO: Congressman Yoho, please stay there. We're getting some new information. Also, so you're not at a disadvantage, I'm going to share that statement with you during the break.

And please to our audience, as well, stay with us. We'll be right back.

(COMMERCIAL BREAK)

[17:21:07] SCIUTTO: And welcome back. We continue to cover the breaking news of President Obama announcing numerous steps, retaliatory action against Russia, for hacking the U.S. election as assessed by the U.S. intelligence community. We want to get more from representative Ted Yoho of the House Foreign Affairs Committee.

Thanks for staying with us, Congressman Yoho.

YOHO: Sure, Jim.

SCIUTTO: I hope you had the opportunity over the break to take a look again at the intelligence community's statement from October, just talking about their confident assessment that Russia was behind this. I mean, just in light of that, during the campaign, as you're aware, Donald Trump said frequently his slogan is America first, right? Make America great again. But...

YOHO: I agree with that.

SCIUTTO: It seems like, on this issue, that he's siding with a foreign adversary against America, certainly against America's intelligence community and against members of his own party.

YOHO: No, I don't see that. And you know, I'm not defending Russia, trust me. And I don't see Donald Trump doing that. I think the election has been held. We have moved on. Let's get on with business. Let's work on foreign policy diplomacy.

But if you want to go back to how did we get to this point, think of Mrs. Clinton having an unsecured server in a room that was unsecured with secret documents and classified information on that. Did that lead to this? And I want to know...

SCIUTTO: With all due respect...

YOHO: ... how -- and present (ph) that.

SCIUTTO: With all due respect, and we -- to our credit, CNN has done a great deal of reporting on that.

YOHO: You have. You've done a good job.

SCIUTTO: But this was an active -- this was an Russian information op to penetrate, offensively, U.S. systems. And then, according to the U.S. intelligence community, to release them strategically over time in the days leading up to the election.

I just wonder, you talk about cyber-security. Donald Trump has just hired as his homeland security adviser someone with expertise in cyber-security. They point out that it's not just Russia but Iran, China, they all have cyber capabilities.

YOHO: Sure.

SCIUTTO: Shouldn't the U.S. be sending a strong and unified message to the rest of the world to deter future attacks?

YOHO: Absolutely.

SCIUTTO: Not to say, "Let's move on. Let bygones be bygones."

YOHO: No. I think that's something that we should have as a national policy for any country, but I also think that falls -- you know, if you're going to put other countries and hold them to that standard, you need to hold yourself to that same standard. And I think that's just a very important process that hasn't been followed here in the last eight years and before that.

You know, we need to be, you know, good to our word and stand on the principles that we hold dear for a nation, and we also need to fight to protect the -- our electoral process to preserve our constitutional republic.

And if Russia has, you know -- I'm not 100 percent convinced that they did this solely, but if they did do that, yes, I think there has to be some payback on that. But I disagree with President Obama saying it's going to be covertly and overtly. I don't think you should announce these things. I think it should be done diplomatically, and I think there's a better way to do this. And I think he should have included President-elect Donald Trump.

SCIUTTO: Well, let me -- let me ask you this, then. You're not convinced. Donald Trump clearly isn't convinced on the intelligence. Do you believe the Trump administration will attempt to reverse some or all of these actions against Russia that the Obama administration has taken today?

YOHO: My -- my bet would be yes, more than likely. Again, if you go back to the executive order that the White House put out, it's talking about any person that does this. So does that include a state? Does that include a rogue actor? It talks about a person, not a state or a nation. And I think it's more theatrics on the Obama administration. And again, I feel like they're trying to pivot for why they lost the election.

SCIUTTO: So you believe -- you do believe...

YOHO: It wasn't because of what the Russians did. It was because of the failed policies that President Obama has done for the last eight years.

[17:25:00] SCIUTTO: I want to make sure I got it right. You believe that President Trump will reverse some of these actions, for instance, welcome back the 35 intelligence operatives that the Obama administration is, in effect, kicking out of the country?

YOHO: I think he'll open up diplomatic negotiations with Russia, and I think, over time, that will come back. I would rather have an open dialogue with somebody that we've dealt with over the years.

It hasn't been the greatest relationship, but it's somebody that we kind of, at this point in time, with America's failing military, or weakening military -- I don't want to say failing -- it's never failed -- but with the weakening of our military through this administration and George Bush consuming so much in the Iraq and Afghan wars, that I would hope we would keep lines of communication open with a country like Russia, with a country like China. You know, President Obama, you know, I don't agree with what he did with the Iran nuclear...

SCIUTTO: But to keep those lines open, you believe it would be necessary, or you would welcome, for instance, calling back 35 Russian intelligence operatives, stopping sanctions against Russian intelligence agencies who carried out cyberattacks. That would be a reasonable price to keep diplomatic lines open? You'd welcome that reversal?

YOHO: No, I'm not going to say I'm going to welcome them back. You know, you're beyond that point. You know, we've got to deal with the situation when Donald Trump takes over. You know, reassess what's going on. What's Russia going to do in retaliation to us? You know, those are the unintended consequences that we're going to have to pay as a nation. And this next administration is going to start off behind the eight ball again. And I just think it's a very poor diplomatic move. I think there was a better way that President Obama could have done this.

SCIUTTO: Congressman Yoho, thanks for taking the tough questions. I appreciate it.

YOHO: You bet. Have a happy new year.

SCIUTTO: And we wish your family a good holiday.

YOHO: Thank you.

SCIUTTO: Coming up, will the U.S. retaliation for Russia's hacking make any difference in Vladimir Putin's behavior?

We're also following another breaking news story: a dangerous winter storm affecting millions of people in New England. Stand by for the latest forecast.

(COMMERCIAL BREAK)

[17:30:00] SCIUTTO: We are following breaking news, President Obama saying, quote, "All Americans should be alarmed by Russia's actions." This afternoon, then ordering an array of punishments for the Russian meddling in the Presidential Election. I want to bring in now our panel of political experts to talk about this. Evelyn Farkas, if i could begin with you -

EVELYN FARKAS, FORMER DEPUTY ASSISTANT SECRETARY OF DEFENSE FOR RUSSIA/UKRAINE/EURASIA: Sure.

SCIUTTO: -- as former Deputy Assistant Secretary of Defense. You were -- you've seen the intelligence, right, on -- not just on these specific attacks but on the long history of Russian cyber-attacks. Of course, without getting into classified material, we just heard Ted Yoho there, expressing doubts as some Republicans have, we've heard Donald Trump expressing doubts about Russia being behind this. Is there any doubt that Russia is behind this election meddling?

FARKAS: No, there's not any doubt. I mean, I don't understand why there are continued statements by the President-elect and others saying nobody knows. I mean, the 16 Intelligence Agencies plus the D.N.I. which oversees all of them, unanimously said that the Russians tampered with our elections.

SCIUTTO: With confidence.

FARKAS: With confidence. And that's another thing. I mean, it's very unusual nowadays especially after the much mentioned by President-elect Trump failure to get the intelligence right in the run-up to the Iraq war. Since then, the intelligence community has been really careful. And high confidence is something they rarely have in their own assessments.

SCIUTTO: Right. Can you, then, panel of wise political experts that you are, explain this reluctance of Donald Trump? Again, last night, we were here together, we watched that sound come in. Donald Trump not just saying "Well, we don't really know, it's time to move on." He even said "We can never really know. You never at the age of computers," et cetera. What's happening here?

JACKIE KUCINICH, CNN POLITICAL ANALYST: I think he is seeing it through the prism of his election. I think he's seeing it through the prism of democrats attacking him and thinking that he is not a legitimate president. And he needs to get beyond that, frankly. Because -- and so do Democrats, for that matter. Because this is about future attacks, much more than it's about the attacks that have already happened. It's important to understand what happened, of course, but this is about what could happen the next election and the next election and everything in between, the businesses, which with anyone who depends on a computer for goodness sake.

SCIUTTO: Let's set -

(CROSSTALK)

SCIUTTO: Democrats aside for a moment because republicans have moved beyond that election sensitivity. You have Mitch McConnell, you have Paul Ryan, you have Senators Graham and McCain saying the whole senate believes that this is serious and that the U.S. has to respond. So, the Republican Party is ahead of and divided with their President.

RYAN LIZZA, WASHINGTON CORRESPONDENT, THE NEW YORKER: But you know, this whole spectacle of how this has turned into a partisan football even though it was an attack on America and you would expect both sides to sort of come together on this, it shows how smart, frankly, Putin was in aiming at one of our great vulnerabilities which is the polarization and partisanship in this country. You know back in the Soviet days, they used to look to American weaknesses like our record on civil rights (INAUDIBLE) or supporting dictators overseas. Now, they hit our soft spots which -- one of our soft spots, which is this partisanship. And, you know, I think this -- Trump is only -- as Jackie said, Trump is only seeing this through the lens of. "Oh, democrats and Obama are using this to somehow undermine my legitimacy." And he needs to get past this because in a few weeks, he's going to be the one in-charge of these sanctions, responsible for implementing these sanctions, responsible for -- he no longer going to be the beneficiary of a Russian cyber-attack, he's going to be the target next.

SCIUTTO: Rebecca.

REBECCA BERG, REAL CLEAR POLITICS NATIONAL POLITICAL REPORTER: It's also -

SCIUTTO: Please.

BERG: It's also Donald Trump's world view. He has spoken very positively of Vladimir Putin and Russia throughout the campaign. So, even before there was this Intelligence Community consensus that Russia was behind the hacking, Donald Trump was relatively supportive of Vladimir Putin and Russia and supportive of trying to, for lack of a better term, reset relations with Russia if he were elected and now that he is elected. And so, this is - this is more, I think, than just him being thin-skinned, him wanting to really protect his reputation.

KUCINICH: The only thing he hasn't changed his mind on, really.

(CROSSTALK)

[17:35:00] BERG: Really. This is one of his consistent policies that he does wants to have stronger relations with Russia.

SCIUTTO: I want to get to what that fight would look like but, Evelyn Farkas, let's talk for a bit about how serious these moves are at this point. I mean, its 35 diplomats intelligence operatives -

FARKAS: PNG's, right.

SCIUTTO: PNG kicked out of the country in 72 hours. Sanctions against two Russian intelligence services. But the line that really struck me was the kind of not-too-subtle hints. These actions are not the sum total of our response for Russia's aggressive activities. We will continue to take a variety of actions at a time and place of our choosing. Is that a message that there are cyber-attacks and retaliation happening or will happen?

FARKAS: Perhaps. I think it's great, because I think that the Russian government needs to be on alert, they need to pay a price. And it shouldn't necessarily be a public price. It just should be a price that hurts. We can see cyber -- maybe a cyber-response, I don't know. They've often said, the cyber experts have said, it may not be cyber. For this administration it will be a question of whether they think it's escalatory. They wanted to be painful for the individuals who are most directly involved. And I think that's probably the most telling, you know, of hint if you -- if you will.

SCIUTTO: Here's the trouble with Russia, this administration has tried this very tactic before against Russia regarding action in Crimea and Ukraine, going after individuals, making it painful economically. And the U.S. knows it's been painful. I mean, it's also against the Russian economy, against specific individuals, and yet, Crimea is still annexed by Russia. There is still Russian - well, separatists backed by Russian forces on the ground in Ukraine. Why does the administration believe this time it will work?

FARKAS: So, I actually worry about that, whether it's sufficient deterrence.

LIZZA: It's not enough.

FARKAS: Yeah. And even the people who briefed on the background, the reporters, from the White House, they basically said, we can expect Russia to keep on doing this. So, I don't know whether they have full confidence --

SCIUTTO: So what's the point? I mean, I would say what's the point?

FARKAS: Well, you have to try. You have to try this --

KUCINICH: Really, because they can't be the administration that went out without doing anything. Because that fantastic New York Times piece, a couple of weeks ago, sort of outlined the fact that they didn't do anything during the election because they were worried how it would affect Hillary Clinton. And they are worried about undermining her and politicizing it. So, they couldn't leave that to be the story.

SCIUTTO: So, you have this odd now political battle set up, right. And that you have -- so the outgoing administration does democrats, does something the incoming Republican President does not want, but his own party criticizing the outgoing Democrat for not being tough enough and saying they want to push -- I mean, McConnell, Ryan, Graham, McCain, they're saying we actually want tougher measures and you got a President who may very well reverse it. I mean, what's this battle going to look like?

LIZZA: That's right. It was -- not everyone of course, not all the Republicans are in Trump's camp on this, right. Both, well, Trump and probably the other republicans are all attacking Obama but they're attacking him for two different things, right. Ryan, and McConnell and a lot of them are Hawkish Republicans, they're saying, "Finally, Obama is getting tough on Russia. We've been calling on this for a long time." This is the one of the first tests of who's going to drive policy in this new republican dominated town. Is it going to be the President-elect? Or is it going to be the leading Republicans on the hill. Because you have a lot of the Republicans on The Hill saying, you know, never mind what Trump says, this is what we believe should be happening going forward on Russia policy.

BERG: And I think a lot of this will actually play out during the confirmation process with Rex Tillerson, the potential Secretary of State would be the Secretary of State for Donald Trump who has very close ties to Vladimir Putin having worked at ExxonMobil in Russia. I think that's going to be really a perfect illustration of how Republicans are going to deal with this issue, with Donald Trump.

LIZZA: And we're supposed to get a statement sooner from Trump. I think it's a very interesting --

(CROSSTALK)

LIZZA: Does he actually say -- does he actually say he'll reverse this? Because remember, this is an executive order. And he can, he can --

SCIUTTO: Or say again, move on, time to move on.

BERG: And then, what do --

KUCINICH: But then what does The Hill do?

BERG: -- congressional republican say? Will they try to fight for sanctions?

SCIUTTO: We're going to have more time to dive on that. Please stick around, standby. There is news coming in from the Donald Trump transition. I want to get to what our sources are saying about how will the President-elect and the current President, how well they're getting along. We'll be right back.

(COMMERCIAL BREAK)

[17:40:00] SCIUTTO: President-elect Donald Trump seems to be happy with President Obama's cooperation on the transition of power. After tweeting a complaint that things aren't going as smoothly as he'd hoped, Trump twice, and on camera, actually praised the President's cooperation. CNN's Sunlen Serfaty is keeping an eye on the President- elect in Florida. So, what else has he been saying or tweeting today, Sunlen?

SUNLEN SERFATY, CNN CORRESPONDENT: Well, it's been quite a 360, Jim. After having that phone call with President Obama on Wednesday, President-elect Donald Trump is now saying that he does think his transition is going smoothly and calling that phone call with President Obama a good conversation, a nice conversation. But today, here at his resort in Florida, he is trying to turn his attention back to business, holding meetings all day and starting to work on that big speech he'll give in just 22 days -- his inaugural address.

(BEGIN VIDEOTAPE)

SERFATY: President-elect Donald Trump huddling behind closed doors today with his inner circle, with private meetings focused on national security, attempting to move past the public feud with President Obama, after their phone call Wednesday which seemed to lower the temperature on both sides.

DONALD TRUMP, PRESIDENT-ELECT OF THE UNITED STATES: It was a very, very nice call, and I actually thought we covered a lot of territory.

SERFATY: Trump trying to put to bed their simmering spat.

TRUMP: Our staffs are getting along very well, and I'm getting along very well with him, other than a couple of statements. And I responded to them and we talked about it and smiled about it.

SERFATY: Trump also taking a small victory lap.

TRUMP: And they're going to be bringing 5,000 jobs back to the United States. They're taking them from other countries. They're bringing them back to the United States.

SERFATY: Taking credit and claiming he helped save or create 8,000 jobs in the U.S. from a tech startup called OneWeb with plans to hire 3,000 and 5,000 from Sprint moving or adding jobs in the U.S. But some of those jobs had already been previously announced in a deal brokered before the election. The Sprint CEO today trying to defend the announcement, tweeting, "Stop speculating. This has nothing to do with previously announced Sprint initiatives." And Trump continuing to dismiss lingering questions over potential conflicts of interest in what is still an unclear role the future President will have in the Trump organization.

[17:44:57] TRUMP: It's not a big deal. You people are making that a big deal, the business, because -- and look, number one, when I won, they all knew I had a big business all over the place. In fact, I reported it with the, as you know, with the federal elections. It's a much bigger business than anybody thought. It's a great business, but I'm going to have nothing to do with it. I'm going to just -- I don't have to because, as you know, I wouldn't have to do that by law but I want to do that because I want to focus on the country.

SERFATY: But perhaps first and foremost on the President-elect's mind, his inaugural address, the most high-profile speech of his professional life.

CNN has learned Trump is taking a personal role in working on the speech, is said to be writing it himself, mindful about the tone that the speech will set for his administration, according to Presidential historian Douglas Brinkley who met with Trump Wednesday.

DOUGLAS BRINKLEY, PRESIDENTIAL HISTORIAN: Donald Trump said "Look, I'm going to give a short inauguration. I don't want something long- winded. I don't like that. I'm going to get right to my point and I'm going to write it all myself".

(END VIDEOTAPE)

SERFATY: And a transition official says that Donald Trump will be convening a dinner meeting here tonight to get some input from his top aides about his speech, and going forward we know that he's been discussing a few past inauguration addresses, those of former President Reagan and Kennedy, certainly trying to look, Jim, to -- at both those speeches as models for his own coming up. Jim. SCIUTTO: Sunlen Serfaty, thanks very much. And were back now with our panel of political experts. Evelyn Farkas, I can begin with you. We heard Donald Trump again in Sunlen's piece talk about how he's going to have nothing to do with his business, not a real conflict of interest. I want to quote from what you wrote today in Politico magazine because it's relevant both to the business and to the Russia's story. You said "We know, per Donald Trump Jr. that Russia makes up a significant amount of the family business. What we don't know is how much Russian money is involved and what Russian money. How did Trump get out of debt? To whom does he owe money? Who provides collateral for his loans? Is he beholden to Russian oligarchs and banks who are under the thumb of the Kremlin and Russian security service?" How serious a question is that?

FARKAS: I think it's pretty serious because there's so much information we don't have. So, my hope is, that when he is ready, he's got his lawyer, his teams together, and they've decided what their approach is going to be towards his conflicts of interest, that they start that conversation by first revealing, first of all, his tax returns, and then what his ties are specifically to Russia and powerful Russians, especially those close to the Kremlin. Because there are too many questions, the statements that his family members have made, and the things that his advisers have done and certainly even his own statements definitely point us towards some kind of close friendly relationship and maybe a business relationship with key Russians.

SCIUTTO: This is a key question. We have very little evidence we will know anything about it to answer that question because Donald Trump doubled down on the point last night which he's made before, one, I'm not really connected to it, and two, he even said, "The people elected me, they know I have business ties. That, in fact, gives me free rein here." Is there any substance to that?

LIZZA: I think he's right. The people do know he was a businessman but I don't know if that was - that drove a lot of voters to just ignore these issues. And he is right that there is no law that prevents him from -- it's not the same as like when Evelyn goes into the administration you have to divest from certain things, that doesn't apply to the President's. We do have this emoluments clause of the constitution which, you know, a very obscure clause that's never really been tested by the courts. And that is obviously part of the law, too.

SCIUTTO: Briefly explain -- I mean, you can't basically profit from. Right?

LIZZA: What the founders were worried about someone being under the thumb of a foreign entity. And they said you can't receive any gifts or anything of value from a foreign state.

SCIUTTO: Would that include -

LIZZA: So, this would -- so the constitutional scholars that have written about that say, if there is a bank that a foreign state has an ownership interest in, and that money goes to a Trump-owned business, that Trump still owns while he's President, that could trigger the emoluments clause and then congress would have to decide what to do about it.

SCIUTTO: Who's going to challenge him in congress?

(CROSSTALK)

LIZZA: That's a good question.

KUCINICH: Politically, this isn't going to go away. It's going to haunt him. Because, he -- especially if he just gives it to his kids, which he is talking about every time he talks to Eric or Don Jr. this going to come up. Because what -- you're telling me they're never going to talk about this thing? That this isn't -- it doesn't pass the smell test.

SCIUTTO: Politically, it may not go away, but legally is this -- is anybody going to challenge it, Ms. Rebecca Berg?

BERG: As Ryan said, a lot of this hasn't been tested. Legally - you know, potentially nepotism could come up if he hires Ivanka and Jared to work in the White House. It's really unclear right now what could happen legally with this. But certainly politically it going to be a problem for Donald Trump moving forward, potentially, something he'll continually have to answer for unless he solves this problem and presents --

SCIUTTO: Well, based upon his statements, changing doesn't seem to be a priority. To the panel, thanks very much. Great to have you on.

[17:49:53] And still ahead, more reaction both here in the U.S. and in Russia to President Obama's ordering sanctions and expulsions to retaliate for Russia's meddling in the Presidential election. Also breaking right now, a powerful storm hitting now in the Northeast and New England.

(COMMERCIAL BREAK)

SCIUTTO: And breaking news, the first major winter storm of the year is hitting New England right now. Not only is it bringing snow and rain but also dangerously strong winds. Let's get the latest from CNN Meteorologist Tom Sater. So Tom, as you look at this, who is in the bull's-eye tonight?

TOM SATER, CNN METEOROLOGIST: Well, good question Jim, I think there are several bull's-eyes. It depends if you're sitting at home in Buffalo, lake-effect snow machines in full force. If you're travelling or trying to fly out of Newark, you've got an hour and a half delay. JFK, up to two hour delays. Boston's looking at it an inch, an hour and a half, as well.

There is some good news, though, as we're look at rain ending in New York City, still raining all on Long Island. Rain changes to snow in Western Connecticut. Central Western Mass, blinding snowfall, blizzard conditions. But it's raining in Boston. I think Boston could see the rain change over to light snow and maybe get a dusting to an inch. But for New Hampshire, Vermont, and Maine, they could be buried with maybe a foot of snow across the entire region. So warnings are in effect. Just mainly snow for interior sections. The coast is going to see mainly rain. We're even going to see snow down the spine of the Appalachians.

[17:55:11] So when it comes to these two storm systems, they're going to join hands. And this is when it really starts to kick in. So the winds will die down right now, gusting at 50 miles per hour at Boston. But the heavier snowfall stays just inland, which is some good news and not blanketing everyone.

SCIUTTO: Tom Sater, we'll be watching. Thanks very much.

And coming up, the latest on this afternoon's major breaking story. President Obama ordering sanctions and expelling Russians from the U.S. as retaliation for the meddling in the Presidential Election.

Also, months after his trail went cold, the U.S. now has information about the recent movements of ISIS leader, Abu Bakr al-Baghdadi.

(COMMERCIAL BREAK)

SCIUTTO: Happening now, Breaking News. Unprecedented punishment. The Obama administration retaliates for Russia's election meddling, slapping on sanctions, targeting Moscow's spy agencies and expelling intelligence operatives. Tonight, will any of these convince President-elect Trump that Vladimir Putin was behind the hacking.

New ISIS intel. The U.S. picks up movements by the terror group's leader after his trail had been cold for months. Are coalition forces any closer to capturing or killing Abu Bakr al-Baghdadi? We'll tell you what we're learning this hour.

And not a big deal. Trump insists his future plans for his business aren't all that complicated, even as he continues to withhold any details.