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ISIS Has Claimed Responsibility For Attack; Trump Opposed Republican Plan To Curb Panel's Power; Russia Denies Orchestrating Election Related Hacking; Syrian Rebels Suspend Preliminary Talks; British Ambassador to the European Union Quits; U.K. Shoppers Look for Bargains Before Brexit; Turkey Increasingly Vulnerable to Terror Attacks; Schwarzenegger Debuts as "Apprentice" Boss. Aired 3-4p ET

Aired January 3, 2017 - 15:00   ET




[15:00:17] HALA GORANI, CNN ANCHOR: Hello, everyone. I'm Hala Gorani. We are live at CNN London. Thanks for being with us on this Tuesday. This is


There are new arrests in Turkey, but the main gunman in the deadly New Year's attack on an Istanbul nightclub is still on the run. This is video

showing Turkish authorities arresting two foreign nationals at the airport today in Istanbul.

We don't have any information about who they are, what their nationalities are. Also, the name of the suspected gunman has not been released. Well,

Turkish media have broadcast this video. It shows the suspect apparently videoing himself, in a video selfie near the nightclub, chillingly.

Sara Sidner joins me live now from Istanbul with more on the manhunt. Hi, Sara.

SARA SIDNER, CNN CORRESPONDENT: Hi, Hala. Yes, you know, the video is chilling. There is also more video that has been published by a local

Turkish online publication that had basically shown the suspect as he was standing outside of a taxi and puts his backpack into the trunk of the

taxi. That backpack holding the gun that he used to massacre 39 people.

He looked very calm. He was smoking a cigarette before he got into the cab and that cab dropped him off, according to the publication, about four

minutes' walk from the Reina Nightclub.

We also, as you mentioned, there are 16 people that have now been arrested in connection with this terrible act. What we don't know, though, is any

details about those who were arrested. If they were arrested just for questioning, if they potentially knew something about the suspect.

We also do not have the name of any potential suspect. The government would likely, if they had it, put it out there to try to find him. So that

is an indication they may not know exactly who this person is. They certainly have not been able to arrest him -- Hala.

GORANI: And where did they find this video selfie?

SIDNER: What's interesting is that some security analysts took a look, and this video was on some ISIS websites and was shared on Twitter. So, this

is something that gives you an indication that if that is where they got this video and not from, for example, his personal site, then it makes it

much harder for authorities to figure out a name, match a name with the video.

The video, as you mentioned, of him doing a video selfie, turning the camera on himself, as he's walking around on the street, and then, of

course, all of the surveillance video they have been able to capture and get some fairly close and clear video of him and his face.

But yet again, we still don't have a name and the worry is, because of where Turkey is situated along the Syrian border, which is quite porous,

that he may have been able to escape. But authorities say they have every plan to catch this man, who did this terrible, terrible deed -- Hala.

GORANI: Yes, I sure hope they do and he's smoking a cigarette. I'm not sure ISIS would be happy with that considering what they do to people in

the territories they control who are caught smoking, which is kind of interesting.

But what about the -- just the victims. It's so heartbreaking to see picture after picture of young people who lost their lives, just, you know,

because they were in the wrong place at the wrong time. What's the latest on sort of the grief that Turkey now is going through?

SIDNER: Yes, one of our producers, Muhammad Talfi (ph) was in the hospital today and he got this incredibly striking story from a Jordanian family who

was inside, enjoying themselves, trying to ring in the New Year together as a couple.

The wife ends up shot in the leg, the husband shot in the shoulder, and the bullet traveling through and out his back and they talked about just

how afraid they were, that they weren't going to make it through 2017.

They also have a child and how he held her and said, please, make it out alive, to our child. Some very strong statements there coming from the


We've also heard another person telling us how people jumped into the frigid dark waters of the bosphorous (ph) just to try to get away as the

bullets rang out for almost 30 minutes -- Hala.

[11:05:07]GORANI: Right. It's just absolutely terrible. Just so heartbreaking, time and time again, we've been covering these stories.

Sara Sidner, thanks so much for joining us, live in Istanbul.

That New Year's Eve attack marked the end of an especially grim year for Turkey and 2017 could bring even more violence. We'll have more from

Istanbul a bit later in our program. So do stay tuned.

Let us turn our attention now to U.S. politics, a big day. The U.S. Congress is back in session for the first time this year facing a packed

agenda, a lot to get through.

Despite that lawmakers made their first priority today to weaken an ethics panel that's designed to hold them to account. But Republicans faced so

much backlash that they were forced to pull the plan to gut the committee designed to investigate wrongdoing in the House.

Now this is what's interesting. President-elect Donald Trump sided with Democrats on this issue in slamming the plan. Here's what he tweeted,

"With all that Congress has to work on, do they really have to make the weakening of the independent ethics watchdogs, as unfair as it may be,

their number one act and priority? Focus on tax reform, health care, and so many other things of far greater importance, #dts."

Now, #dts means drain the swamp. This is what Donald Trump has promised, after all. Let's break this all down for you. Joining me now live, our

"Daily Beast" editor-in-chief, John Avlon. He is in New York, and on Capitol Hill, CNN politics reporter, Jeremy Diamond.

I wonder, Jeremy, I mean, is the sense on Capitol Hill that Republicans backed away, pulled this plan because of criticism not just from Democrats,

but also that tweet from Donald Trump?

JEREMY DIAMOND, CNN POLITICS REPORTER: Well, it's clear that there were a lot of heat around Republicans on this plan and actually, you know,

Republican leadership, Paul Ryan and Kevin McCarthy, both of them said that this was not the right time to do this move. That they wouldn't have

necessarily done this.

But it was really the rank and file Republicans who were pushing for this measure, and ultimately abandoned it today. But one point I would stress

is that, you know, Donald Trump, just like the Republican leaders, didn't necessarily oppose this move to essentially gut the Office of Congressional


What he did oppose was the timing of it. He opposed the fact that they were doing this right now at the start of the new Congress, saying that

there were other priorities to focus on, such as health care, such as tax reform, but he didn't necessarily say that this was not a move that he

would endorse at a later date.

GORANI: Right. And John Avlon, one has to wonder, whose idea was it to try to push this through on day one of the 115th Congress?

JOHN AVLON, CNN POLITICAL ANALYST: Whoever's idea it was, you know, this was among the least bright ideas anyone has ever had on Capitol Hill, and

that's saying something. Politics is perception and to come straight out of the gate with a measure that transparently is designed to gut


When the organization was put in place after a series of Republican scandals a decade ago, it didn't even begin to pass the smell test, and

they apparently thought they could get away with it and no one would notice, no one would kick.

Well, people did including the president-elect. So whatever their motivations were, and they're I'm going to guess self-interested, they met

the blowback they deserve, but it was a dumb way to start the new Congress.

GORANI: And Jeremy Diamond, meanwhile, Donald Trump has been tweeting away. He's been taking more credit for corporate moves, for instance, Ford

scrapping plans to move or to open a factory in Mexico. He's also been naming corporations, General Motors in this case, and threatening it with

increased tariffs, you know, if it continues to do business across the border. So, is this way of communicating sort of decisions, can we expect

to see that when he's in the oval office?

DIAMOND: I mean, I think that's certainly possible, you know? So far, Donald Trump and his aides have suggested in no way that Donald Trump will

have to get rid of his Twitter account. In fact, he'll get a second one when he gets the @potus account that President Obama currently uses.

We'll see if Trump will actually be tweeting personally from that account. But certainly I think that Donald Trump realizes that this is an effective

way of communication. I mean, every time he sends a tweet, it's like a statement on one of these issues.

And the fact that they are so short in these 140 characters leaves that many more questions, of course, and kind of continues to drive the news

cycle. So I think Donald Trump has realized that this is an effective way for him to communicate.

It is also one fraught with some difficulty and controversy at times. But you know, if the campaign is any measure and the transition are any measure

of how he's going to communicate with Americans, it looks like he'll continue to do that.

GORANI: And there were also, John Avlon, some tweets regarding China and North Korea, that because we're abroad, you know, many journalists and

editorials focus a lot on what he says about foreign policy.

North Korea was one big question when he said, look, North Korea's trying to build an intercontinental ballistic missile that could reach the United

States. Donald Trump says that's not going to happen.

[15:10:05]But we're not given any clue on how he might stop North Korea from going that far. So, I mean, at what point should we expect more

details here?

AVLON: I think, you know, Hala, it's a mistake to think that we're going to get a different Donald Trump once he takes the oath of office. I mean,

you know, he clearly believes that his style to date has succeed and I'm sure the glass half full version is that he's taken advantage of social

media the way FDR did radio and JFK did TV.

But as you point, there's a significant limit of what you can say with any degree of detail, let alone diplomacy, in 140 characters. So buckle up,

it's going to be a wild ride.

GORANI: So what happens now, Jeremy Diamond, with this ethics committee? I mean, as John and as you have mentioned as well, he's not against the

idea of reforming it, gutting it, weakening it, whatever it is, just the timing. Is this something that might happen, still?

DIAMOND: It's certainly something that could come up again, but probably not for at least several months, probably not until the end of this year,

if at all. You know, again, if they are sticking to what Republican leaders and Donald Trump were saying, you know, it's not going to be the

priority right now.

They're going to try to get Obamacare repealed first and go through tax reform. Those are kind of the things initially on the chopping block for

this 115th Congress. We'll see if that ever comes back up again, but as of now, the office remains untouched.

GORANI: And John, that's a very, very long, very ambitious list of things that Donald Trump has promised. There's also TPP. There are also trade

deals, all sorts of things, Obamacare, and other things. He's going to have to deliver, isn't he, right? I mean, I know now that those who

supported and voted for him are willing to wait and see, but he's going to have to deliver. Can he?

AVLON: Well, look, I think, first of all, he's got unified control. Republicans control Congress. So, you know, there's nothing to stop him

but himself, but I think there are two factors at work. One, you know, the chopping block metaphor that Jason just used.

A lot of these are negative agendas. They're about undoing things that Obama did. Sometimes easier said than done, and that raises the second

question, which is, for example, in the case of health care, repeal and replace. With what?

What's the positive agenda they're going to put in place? Because you can't simply cut without doing proactive, positive things that create a

governing agenda. That's a level of responsibility, a level of detail we just have not seen from Donald Trump.

So that's where the substance, yes, that's where the rubbers got to meet the road. There is a lot of unanswered questions that 140 characters and

his style of campaigning have not given us to date about what kind of policies he will actually try to implement.

GORANI: Well, we are going to speak with one of his top advisers in just a few minutes so we'll ask those questions. John Avlon, thanks very much.

Jeremy Diamond on Capitol Hill, we appreciate you having on the program.

Well, he's not in office yet, but Donald Trump is already claiming another big win when it comes to protecting American jobs. We alluded to this

story with John Avlon there. Ford says it has canceled plans to build a plant in Mexico, and that will it invest $700 in Michigan instead.

The move will create 700 new American jobs. Ford's CEO says the decision was made independently of the president-elect, but that it's a, quote,

"vote of confidence" in the pro-business environment created by Trump.

Now, of course, Donald Trump won the election. Hillary Clinton lost. Bill and Hillary, though, say they will attend Donald Trump's inauguration. The

2016 Democratic presidential nominee and the 42nd president will be at the ceremony on Capitol Hill on January 20th.

And also, George W. Bush, who did not vote for Trump on Election Day, will also be there. His father, George H.W. Bush, will not attend, though, due

to ill health.

A lot more to come this evening. Donald Trump's transition team says the president-elect is putting North Korea on notice. We'll have the very

latest on a war of words over Pyongyang's nuclear program. We'll be right back.



GORANI: Donald Trump is firing back at a thinly veiled threat by North Korea, using his favorite tool to deliver a message to the world. The U.S.

president-elect wrote this on Twitter. North Korea just stated that it is in the final stages of developing a nuclear weapon capable of reaching

parts of the U.S. It won't happen!

He was responding to North Korean Leader Kim Jong-Un's declaration that his military is on the brink of test launching an intercontinental ballistic

missile, but Trump did not stop there. He's also taking China to task, accusing it of doing nothing to help rein in Pyongyang.

Let's bring in one of Trump's senior advisers, former CIA director, James Woolsey, and he joins us from Washington. Thanks, sir, for being with us.

So how -- and this tweet raises more questions than answers. How will a Donald Trump administration stop North Korea from developing a missile

capable of reaching the United States? Do you think?

JAMES WOOLSEY, SENIOR ADVISER TO DONALD TRUMP: I don't know. Economic sanctions have not worked real well with North Korea in part because we

start them and stop them when North Korea threatens. And that's been going on now for 10 to 15 years.

It's a -- I think the most difficult problem in international relations to deal with right now, because of the suspicion that the North Korean

government is so unstable and the leader is so unstable.

And that creates a, I think, a real dilemma for the chiefs of state in South Korea and Japan. We need to pull together and do whatever we do

together, with our allies in Northeast Asia and we need to do whatever is necessary to bring China along. That's --

GORANI: You're saying -- right. And so what do you do with China then? Because I mean, Donald Trump also accused China of not playing along.

Clearly, he's pointing fingers in the direction of Beijing. So what is he suggesting we do there?

WOOLSEY: Again, I don't know what will be chosen.

GORANI: What are the options?

WOOLSEY: But -- well, one is for us to work to cooperate with China on a number of economic issues. I think fuel switching, so we don't always end

up using gasoline and petroleum-based fuels is one of them. The Chinese are very much into this issue to drive down the price of transportation

fuel and also to save their environment, which is terribly affected by use of gasoline and diesel.

So I think there are some things we can do together with China that care a great deal about building infrastructure in the interior of Asia. There

are ways we can cooperate with them economically, but it may not get the job done. This is a terrible --

GORANI: This is a far cry from Donald Trump's threat to raise tariffs over 30 percent and accusing China of playing, of using currency manipulation

and the like. So these sound like sort of other potential avenues that would be sort of more middle of the road?

WOOLSEY: Well, China is doing some things economically and in terms of trade and currency and so forth that are a problem. Some of them are

serious problems. But there may be some ways in which we can have -- use both a carrot and if not a stick, at least a stick held behind our back,

along the lines of Teddy Roosevelt's speak softly but carry a big stick.

[11:20:06]GORANI: All right. Russia hacking, you told my colleague, Jim Sciutto, the possibility that Donald Trump would promise to share some

important information with us today or tomorrow might be playing us. He said, do you think Donald Trump is playing us? That he doesn't have

information, you said, that's quite possible.

WOOLSEY: His and mine kidding around about that was in a different part of the interview.


WOOLSEY: We were talking about the campaign, I was, anyway. Saying that - -

GORANI: He was asking you about his promise to reveal important information Tuesday or Wednesday.

WOOLSEY: Right. Well, I -- I don't know what he plans to do on that, but we were talking generally about his unique and different style in being a

campaigner, which worked out very well for him, although all of the folks who know how to run presidential campaigns said this was a terrible and

crazy way to do it. It's just that it succeeded. So, he has a history now of having succeed on some things that everybody told him was, were


GORANI: You still said playing us was a possibility. Is this something that Donald Trump is doing? Where he sort of promises stuff, but you know,

we shouldn't read too literally -- I've been told this by so many people. Don't read too literally into word for word what Donald Trump is saying.

He says it to stir the pot. He says it to be provocative. If he promises confidential information, you might get it, you might not get it, just wait

and see, that kind of thing.

WOOLSEY: I've found in small meetings, two, three, four, five people. Talking with him good questions, good answers, very thoughtful, et cetera.

Before large groups, he's something of a showman and things are said that very few people want to follow up on. But even sometimes there, he is

pulled out to positive effects from things that everybody told him were just showmanship and we couldn't take them seriously. So this is a unique

political figure.

GORANI: But I've got to ask you, you've got a very long, distinguished career. You know world affairs, you know international relations. If you

tweet out things like, "Let's start a new nuclear race," or anything like this, there has to be inherently some danger on doing that on Twitter, if

you're a showman, as you said.

WOOLSEY: First of all, I don't use Twitter or any social media at all --

GORANI: I'm just saying, the candidate you support. You advise Donald Trump on foreign policy and international affairs. Is there inherently a

danger there to be that spontaneous and to act as a showman?

WOOLSEY: One needs to be cautious and to plan what one does and this, as in all things, he's not president yet. He's learning. He's getting going.

He's selecting his people and I think we should, to some extent, wait and see how this goes and how he moves into the post-swearing in world.

GORANI: Got to ask you one last question on Brexit, big news here in the U.K. I don't know if you've been following it. The U.K. ambassador to the

E.U. is resigning. He said, privately, apparently, it could take ten years to negotiate a trade deal. What do you think the Donald Trump

administration -- how will it approach Brexit negotiation -- trade negotiations with Britain after it decides to leave the E.U.?

WOOLSEY: I think the history of relations with Britain and indeed with the E.U. is generally fairly positive, and I don't see any likelihood of a

negative move toward Britain and its economic policies. I think this is something that has been principally a matter of Asia and I think from Mr.

Trump's point of view, that is where the focus has been so far.

GORANI: All right. James Woolsey, thanks very much, a former CIA director, adviser to Donald Trump. Thanks for joining us on CNN.

We could soon learn a lot more about the U.S. intelligence community's case against Russia. We discussed it a bit there with James Woolsey, a

comprehensive review into the hacking ordered by President Obama. This review is due as early as this week.

But as Fred Pleitgen reports, Russia is only intensifying its denials as all this controversy deepens.

FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, Hala, a U.S. intelligence source tells CNN that the intelligence services were able

to trace the hacking back to a computer using a Cyrillic keyboard. And the digital fingerprint that was left seems to highly indicate that Russia was

behind these hacks.

The spokesman for the U.S. State Department, John Kirby, went as far as to say that he believes 100 percent that the Russian government was behind

these hacks. Now, the Russians, of course, take a very different view of all of this.

[15:25:05]Earlier today, I was able to speak to the spokesman for Russian President Vladimir Putin and he said in reaction to this new information,

regarding this digital fingerprint, he said, quote, "I don't understand what this means exactly, but the Cyrillic characters can be used


Once again, I reject any possibility that official Russia can be involved in any way." Again, of course, the U.S. taking a very different view of

all of this. And of course, all of this has led to a further souring of relations between the United States and Russia.

And that is something that certainly the Russian government hopes will change very soon when Donald Trump comes into office. Earlier today, I

spoke to a former adviser of Russian President Vladimir Putin, who believes that Putin was downright euphoric when Donald Trump was elected.

He also believes that the two men have a very similar style of operation, and that Vladimir Putin respects the fact that Donald Trump was the

underdog in the run-up to the election and still managed to win.

So the Russians are certainly hoping for a lot of concessions from the United States, for better relations with the United States, but at the same

time, still very much waiting and watching whether or not Donald Trump will follow through on some of the very positive rhetoric that we've seen from

him towards Russia over the past couple of weeks -- Hala.

GORANI: All right. Thanks, Fred Pleitgen.

Still to come tonight, an abrupt resignation. The U.K.'s ambassador to Europe, he was supposed to lead Brexit negotiations and he is out. We'll

discuss the consequences in a few minutes. We'll be right back.


GORANI: Police in Turkey are making more arrests in connection with the attack on a nightclub, but the gunman is still on the run. Turkish media

say this selfie video shows the man police suspect of storming a club in Istanbul, killing 39 people on New Year's Eve. This video, though, hasn't

been independently verified by CNN.

Also, among the top stories we're following, drama on the first day of the new American Congress. House Republicans drop one of their first major

initiatives. It is actually their first initiative, after it was criticized by President-elect Donald Trump. The plan would have gutted an

independent ethics panel designed to oversee their work.

And a major announcement from Ford Motors to keep jobs in the United States. The automaker has canceled plans to build a plant in Mexico, on

the opting for a new one in the United States, instead. The CEO says Ford is hoping for a more pro-business environment under the Trump


[15:30:00] He says the automaker did not strike any deals, though, with Donald Trump.

A coalition of Syrian rebels is suspending talks in the lead up to planned peace negotiations. The rebels say it's because of Syrian regime

violations of a four-day-old ceasefire agreement. They have not withdrawn, though, from the January talks due to take place in Kazakhstan. They have

not withdrawn from that round of negotiations.

One rebel group says it fired missiles at regime positions in retaliation for those ceasefire violations, further threatening the truce. Senior

International Correspondent Nick Paton Walsh has more on the fragile cease- fire.


NICK PATON WALSH, CNN SENIOR INTERNATIONAL CORRESPONDENT: Hala, as we become so accustomed to seeing in the past years, this notion of a

ceasefire rare because it had the old signatories of both Turkey, who traditionally backed Syrian rebels, Russia and the Syrian regime, who are

allies, on the paper along with Syrian rebels, but the ceasefire has really seemed to fall apart to some degree to the point where the U.S. State

Department has, in fact, accused the Syrian regime of using it to continually pound the rebels.

Now, that statement is based on the premise of a town called Wadi Barada near Damascus. It's the source of much of Damascus' water, in fact, now

cut off for a number of days. Wadi Barada being pounded by the Syrian regime. Now, the regime say that's because there are al Qaeda affiliate

rebels in the ranks of the other rebels there. Those rebels deny that.

But still, we've seen, in the past 24 hours, other Syrian rebels taking sort of vengeance steps, frankly, against two regime loyal towns in the

north of Syria, Kufriya and Fu'ah, hitting them with ground missiles. The Syrian opposition reporting 42 ceasefire breaches on Monday alone. It's

clear this isn't what we would normally expect to be a ceasefire. Often, we've seen Russia and Syria use these political negotiations to advance

military aims. That could well be the case here in Wadi Barada.

Turkey may find themselves confused at this point because they were going along with originally a moment perhaps of cessation of hostilities. It's

unclear where that policy now will take them. But what is absolutely certain is that violence for civilians on the ground, particularly the

estimated 100,000 rebels that could be in Wadi Barada, is absolutely unabated, Hala.

GORANI: All right. Thank you very much to Nick Paton Walsh who is in Beirut.

Now, big Brexit news. A top diplomat who was supposed to play a key role in negotiations for the U.K. to exit the E.U. has abruptly resigned. It

was a big surprise for everybody.

Ivan Rogers, seen here next to former Prime Minister David Cameron, is the U.K.'s ambassador to the European Union. The government said Rogers had

left to enable a successor to be picked before exit talks begin. Those complicated negotiations are set to begin by the end of March.

Let's bring in conservative lawmaker, John Redwood. He was in favor of Brexit, and he joins me now from London.

Thanks, sir, for being with us. As I was reading the papers today, we had quoted in "The Guardian" and another newspaper, for instance, a former top

treasury official said, "This is the willful and total destruction of E.U. expertise, and you do this two months before talks begin, before Article 50

is triggered."

Why is the government doing this now? Don't they need men like Ivan Rogers?

JOHN REDWOOD, MEMBER OF PARLIAMENT, UNITED KINGDOM: Well, this is completely nonsense, that comment. Ivan Rogers has decided of his own

volition to resign. I think it's because he probably doesn't have his heart in the idea of an independent Britain with a better relationship

based on free trade and friendship with our former partners in the European Union. And of course, he was very heavily involved in the failed

negotiations to get a better deal for Britain to enable her to stay in, so I can quite understand --

GORANI: So this is was decision?

REDWOOD: -- why he wanted to go. It means we can appoint someone who is really committed to the project. It's a really exciting project. It

should appeal to all Americans because you've always rightly prized your independence as a country, and we wish to get our independence back.

GORANI: No, but you need experts. You need people who've been there a while, who understand, you know, how the E.U. works, who could put Britain

in the best possible negotiating position.

REDWOOD: We all understand how the E.U. works. That's why we voted to leave it. We've had 44 years understanding how dreadful it is and how it

impedes our own right to make our own laws, spend our own money, and control our own borders.


REDWOOD: And we need someone in there who will work with the top negotiating team, and the top negotiating team would be the Prime Minister

and three Cabinet ministers and several ministers of state working with them. And the ambassador will be there to assist them and help them. And

yes, of course, we need to appoint someone now who has a good range of networks and contacts and is well liked by as many of the European

countries as possible --

GORANI: But you need to do this quickly.

REDWOOD: -- but this figure is not the figure who's going to be driving the strategy or the negotiation.

GORANI: Time is of the essence. The clock is ticking. Only a few more weeks before the end of March. I mean, who's in the best position to take

on this job?

REDWOOD: Well, there are quite a lot of people, I'm sure, who see themselves as candidates. We've got a very strong diplomatic force in the

foreign office, and we've got other people in business and other institutions around the country with a wide range of networks and contacts.

But this is not the fundamental job.

[15:35:11] The prime person handling this negotiation will be the Prime Minister, and she's now read herself into the job for the last six months,

aided by three specialist Cabinet ministers dealing with international trade, Brexit negotiations, and foreign affairs. So this is a very

heavyweight top team, and this will be a political negotiation. This is a political process. We are reclaiming control of our own country, and that

requires top-level political negotiations.

GORANI: Well, John Redwood had privately said, and this had angered, according to reports, people in the government, that it could take 10 years

to negotiate a trade deal between the U.K. and the E.U. Does he not have a point that this two-year or three-year --

REDWOOD: That wasn't John Redwood. That was retiring ambassador --

GORANI: I'm sorry, I'm sorry.


GORANI: Ivan Rogers. I'm sorry, John Redwood.


REDWOOD: I said it could take 10 weeks if we wanted to get on with it, but we are not doing that.

GORANI: You said 10 weeks, he said 10 years. There you go. But let me ask you this, though. Does he not have a point, Ivan Rogers, the departing

diplomat right now? Also, one of the other things he said, which you can't disagree with, which is that any of the 27 other members of the E.U., any

one of their national assemblists or parliamists, could decide simply not to ratify any deal the U.K. strikes with the E.U. That's true, right?

REDWOOD: No, it's not true and nor is much of the rest that the Ambassador was advising. There's no way it's going to take 10 years. We will leave

the European Union by sending them a letter and passing the necessary legislation. We don't need their permission to leave.

It gives us the right to leave in the treaty, and we will exercise the right. And we don't need to negotiate with them controlling our money, our

borders, and our laws. That is something we are going to do for ourselves.

The only issue we need to discuss with them is how we trade with them in the future, and it's a very simple choice. And it shouldn't take them long

to make up their minds, although, doubtless, they will make a meal of it. They can either decide to carry on tariff-free as we trade at the moment,

which we'd be very happy to do, or they can decide to go over to WTO tariffs, which are, rather simply, modest, which is what we have to pay for

our trade with America and China and the world in general.

GORANI: You don't have any concern that this is going to drag on, that this is going to be, in the end, quite painful, perhaps, for the United

Kingdom, obviously?

REDWOOD: No, I don't think it's going to be painful for the United Kingdom, but if it drags on, it's a nuisance. I fear it may drag on

because there are an awful lot of people with a vested interest in making it drag on. There are a lot of officials and consultants who see a lot of

work in this if they make it complicated. I think it can be much easier and quicker if only we express the political will and get on with it.

And what business tells me is they we want an end to the uncertainty. The only way to end the uncertainty is for us just to leave using our legal

rights to do so, and for the others to agree that it would be quite stupid of them to want to impose tariffs on their trade with us, so why don't they

accept our generous offer of carrying on with tariff-free trade.

GORANI: All right. John Redwood, thanks very much for joining us with reaction there to this abrupt and surprising resignation by Ivan Rogers.

We appreciate it.

Let's get more on this. I'm joined by Jill Rutter. She is joining me here in the studio. She's the programme director for the Institute for

Government. She is with me here in the studio.

You heard John Redwood there, the MP, very much pro-Brexit. Didn't think at all that it was an issue for Sir Ivan Rogers to abruptly depart and step

down from his role as ambassador to the E.U. What impact do you think it will have?

JILL RUTTER, PROGRAMME DIRECTOR, INSTITUTE FOR GOVERNMENT: It's quite interesting. He does represent a loss of expertise, of knowledge, of

networks within the E.U.

Looking around, it's not immediately clear who is best placed to fill that gap. In fact, his number two is gone as well. She was already appointed

to another job back in November. So there's been a bit of a loss of expertise at the top of the U.K.'s representation in Brussels. Those, of

course, were people correctly and critically sporting the Prime Minister and the Cabinet ministers that John Redwood's mentioning.

GORANI: But John Redwood, he said, look, here's a man who, from the beginning, his heart wasn't in it. He was appointed by David Cameron. He

was against the idea of the U.K. leaving the E.U. Why have him negotiate a new deal?

RUTTER: Remember, in the U.K., it's the politician who is negotiate, and we have an impartial civil service. Their job is to support ministers on

ministerial policy. But their job is also, we hope, to speak truth to power, to give them uncomfortable advice when it's necessary. And I think

one of the really worrying things about this resignation is if it's interpreted that he was forced out or decided that giving unwelcome advice

was not his role, was not there, and it's such a --

GORANI: Could it be that, that he basically angered the Prime Minister or others in the government by saying, you know, fair warning, you think it's

going to take two years, this could take a decade?

RUTTER: Well, that was his reported views, reporting the views from other E.U. member states. That's clearly a view that is kicking around.

At the moment in the U.K., there are lots of very conflicting views. You've had one very optimistic view of how easy Brexit is from John

Redwood. Let's say that view is not universally shared in the U.K. at the moment. There are quite a lot of conflicting views. We don't really know

at the moment.

[15:40:08] And if they do look to another official to replace Ivan Rogers, if officials think that they're going to be sort of cast aside if they give

unwelcome advice, then they're going to find it --

GORANI: But is that what this --

RUTTER: -- rather difficult to attract someone to step up.

GORANI: I've heard this criticism directed at this government.


GORANI: That this government, in particular, is a bit touchy when, from within, it feels like not everyone is falling in line. Is that fair

criticism or not?

RUTTER: I think if the Prime Minister wants to get the best possible feel with this job, and she needs the best possible advice she can get for her

and her ministers as we approach Brexit, I think then she needs to make absolutely clear, and she said this, that she really does want, you know,

good, unvarnished, truthful advice and is prepared to listen and debate with it, and then I think, well, OK, what do we do with that advice rather

than just discount it?

So I think it's absolutely critical, at this juncture, she makes clear that she wants people who are really prepared to speak truth onto her.

GORANI: Yes. Well, Jill, though, the thing is, the economy has not been doing badly, and people had predicted an apocalypse. The FTSE is hitting

highs. We're going to look at that in a moment. What's going on there, do you think? Why is there this political uncertainty not translating into

economic worry?

RUTTER: It's quite interesting. I mean, what we've seen is some short-run effects. Some of the early assumptions like the forecast that the Treasury

put out about what would happen with Brexit, assumed we triggered Brexit straight away. I think a lot of the experts, who've been much discussed

here in the U.K. and I think in the U.S. recently, a lot of the experts assumed --

GORANI: They're not in favor these days, are they?

RUTTER: They're not as much in favor. I think they assumed that confidence would fall off a cliff very quickly.


RUTTER: And that clearly didn't happen. I mean, what's happened in the U.K. over the past few months is confidence in the economy has held up.

Consumers are spending, and that's actually what's been fueling the growth in the U.K. economy.

We also, in inverted commas, "benefited" from a very precipitous fall in the value of sterling.


RUTTER: So that's had some good effects. I think what's not clear is what the medium term effects are going to be, what the long-term effects are

going to be, and that's still the game in hand.

GORANI: Certainly, we're going to keep our eye on that. Thanks very much. Jill Rutter is the programme director for the Institute for Government

joining us in the studio. We appreciate it.

Well, Jill, just one moment because you might be interested in this. Those negotiations are still a few months away, but right now, Britain's markets

are booming.

As we were discussing with you, Jill, the FTSE 100 closed trading at an all-time high. It had crashed through the 7,200 mark earlier in the day

before finishing at 7,177. Britain's stock market finished 2016 more than 14 percent higher despite Brexit fears.

And it's not just the stock markets where Britons are doing well. If you're a bargain hunter, there's probably no better time to shop.

Retailers are offering big discounts. They're not likely to last for long because Brexit is looming, and some analysts believe prices will rise,

though, as the year progresses. Isa Soares has that story for us.


ISA SOARES, CNN CORRESPONDENT: Fifty, 60, as much as 70 percent off. Pretty attractive bargains that had many people here making the most of

what's on offer. In fact, in the last few days, Brits have spent an estimated $9 billion. That's very good news for retailers, but shoppers

will soon see their spending bubbles burst as Brexit pushes prices up.

Well, already, we are seeing the impact. Brits will have to pay 11 percent more for an Apple iPhone. Why? Because of this.

Over the past six months, sterling has been fluctuating wildly. For example, this 10-pound note has been worth anything between 12 to as much

as $15. And as these fluctuations coupled with a lack of clarity, a lack of certainty over a Brexit plan, which makes it very difficult for

retailers to protect themselves against any potential losses.

RICHARD HYMAN, RETAIL ANALYST: The only protection in a market like this is to be better than the guy next door, and retail in this country is now

massively oversupplied. There are too many mouths to feed. I think we're going see a lot of collapses this year.

SOARES: The U.K. also relies heavily on imports, clothes made in Southeast Asia, technology from China, imports which could become more expensive.

Currently, the U.K. enjoys cheaper trade tariffs a part of being in the E.U. If the country fails to reach the right deal with the block, you'll

have to use World Trade Organization rules which come with a higher tariff. A bottle of wine could set you back an extra 14 percent, and some analysts

are predicting it will cost you an additional 12 percent to be on trend.

But are shoppers enjoying the January sales aware of the possible increases?

UNIDENTIFIED MALE: I have noticed that prices seem to be creeping up, both online and in the shops, for certain. A lot of tech, food seems to be

creeping up a little bit. Household bills, not at the moment, I haven't noticed, but, yes, certainly things are on a high street.

[15:45:08] UNIDENTIFIED MALE: Given an uncertainty, prices do certainly fluctuate in some ways. I expected us to be a little bit worse off.

SOARES: Cautious words from Brits who now have no say in what deal their country may get in Brexit negotiations.

Isa Soares, CNN, London.


GORANI: This is THE WORLD RIGHT NOW. Coming up, he is taking Trump's job but not his catchphrase. We'll look at how Arnold Schwarzenegger fared as

host of Donald Trump's former reality show, "The Apprentice." Stay with us.


GORANI: Let's return to our top story. The New Year's Eve attack marked the end of an especially grim year for Turkey, and 2017 could bring even

more violence. Ian Lee reports from Istanbul.


CROWD: Three, two, one!

IAN LEE, CNN CORRESPONDENT (voice-over): At least 39 killed, revelers at a nightclub on New Year's Eve, just the latest deadly attack in Turkey.

In 2016 alone, 45 people killed at Istanbul's Ataturk airport in June. No one has claimed responsibility, though the Turkish government blames ISIS.

An explosion at a wedding in Gaziantep in August killed close to 50 people. Tourists targeted, the Russian Ambassador assassinated. Who are Turkey's

enemies and why do they keep attacking?

SIMON WALDMAN, AUTHOR, "THE NEW TURKEY AND ITS DISCONTENTS": Turkey's borders are with that of Iraq and with Syria, both home to large Kurdish

populations. And there's instability in both of those states, which have allowed the rise of militant groups, such the Islamic State, to really gain

momentum and then attack Turkey in turn.

LEE (voice-over): Kurdish separatists have long held Turkey in their sight. Their tactics, at times, brutal. Twin bombings killed dozens at an

Istanbul soccer stadium last month, claimed by the Kurdish separatist group, PKK, an offshoot of the banned Kurdish Workers' Party. The

government responding, carrying out regular and deadly attacks in Turkey's Kurdish region.

On Turkey's borders, this civil war in Syria has given Turkey another front to fight. ISIS, with its stronghold in Syria, claimed this latest

nightclub attack at a point when Turkey has immersed itself deeper in the Syrian question, battling both ISIS and Kurdish fighters in northern Syria

and working closely with Russia to come up with a peace proposal. But this alignment between Turkey and Russia also leads to questions about where

Turkey sees its relationship with the United States, which backs those same Kurdish fighters in Syria.

All of this against the backdrop of Turkey's own internal political struggle. Last July's attempted coup and subsequent emergency measures not

just resulted in thousands of civil servants and military personnel being detained.

[15:50:08] WALDMAN: Where individuals who have had years of experience in dealing with terrorism are no longer there, instead replaced by people who

have less experience. And that has left, quite frankly, a vacuum within Turkey's domestic security operations.

LEE (voice-over): And led to claims that President Erdogan is essentially forming his own autocracy, where opposition, political or otherwise, is not

tolerated. But the government has been quick to push back at critics.

RECEP TAYYIP ERDOGAN, PRESIDENT OF TURKEY (through translator): Some are car bombs, other suicide bombers, but many have been prevented.

LEE (voice-over): A country that seems to have enemies on many fronts, the question is, can it fight them all and win?

Ian Lee, CNN, Istanbul.


GORANI: Check out our Facebook page, We'll post some of the segments of our program online. Stay with us. We'll be

right back.


GORANI: Well, for the past 13 years, President-elect Donald Trump has had a very different job. He's been the brash, bold host of the reality show,

"The Apprentice," and its celebrity spin-off.

Well, now that Trump's headed to the White House, there is a new boss in town. And this is not someone who's going into politics, but who's coming

from politics. Take a look.


ARNOLD SCHWARZENEGGER, ACTOR: Carrie, you're terminated. Now, get to the chopper.

Carnie, you're terminated. Hasta la vista, baby.

CARRIE KEAGAN, APPRENTICE: The first one to go, but the worst thing about this is --


GORANI: The intersection of reality television and politics, now more than ever. Trump's famed "You're fired" catchphrase has been retired in favor

of those Schwarzenegger classics, but the President-elect still gets executive producer credit on the new season of "Celebrity Apprentice."

Let's bring in CNN Money Media Reporter Frank Pallotta.

Frank, you saw the show starring Arnold Schwarzenegger. So, of course, he was a star first, then became a politician. Now, he's back to

entertainment. First of all, how was it? How did it do in the ratings?

FRANK PALLOTTA, CNN MONEY MEDIA REPORTER: Well, I will be honest with you, I watched a little bit of it, but I was flipping back and forth between

that and ABC's "The Bachelor," which according to the ratings, a lot of people were because it didn't do really that great in ratings.

It brought in around 4.9 million viewers. That's down from the 6.5 million viewers that the 2015 premiere had, and that was hosted by the future

President, Donald Trump. So to look at it this way, it was beaten by ABS's "The Bachelor," in that that brought in around 6.6 million. And even

bigger than that, 18 to 49-year-olds, which is a prized advertising demographic, "The Bachelor" beat it 62 percent.

So the reviews weren't really great for Arnold. A lot of people said he kind of lacked the bite that Trump had all those years on "The Apprentice,"

but the parts I did watch -- I mean, I love Arnold Schwarzenegger, and seeing him say, you know, "You're terminated" and "Get to the chopper," you

know, it's very fun and very interesting. And such a very funny, really --

GORANI: And just so I'm clear, "the chopper" is a helicopter, right? What happened? They --

[15:55:00] PALLOTTA: Yes, it's a callback to a line he said --


PALLOTTA: It's a --

GORANI: So they just get escorted to a helicopter when they're fired?

PALLOTTA: Yes, pretty much. Yes, well, "Get to the chopper" is a callback to a famous catchphrase of his from the movie "Predator," which was in the


GORANI: Oh, yes.

PALLOTTA: But, yes, literally, as you can see now, they walk to the helicopter and they get flown away. So it's very interesting.

GORANI: It looks very chilly and uncomfortable. Yes, "You're terminated," I got. The "Go to the chopper" one, not so sure.

But now, of course, as I was telling our viewers before, they all know Arnold Schwarzenegger from his films, "The Terminator," "Total Recall," and

all that. Then, of course, he became a politician, and now he's back.

Now, Donald Trump went from being "The Apprentice" presenter to, you know, holding the highest office in the land, President of the United States, in

just a few days. This is a brand new world where politics and entertainment are almost indistinguishable.

PALLOTTA: Yes, I mean, and in a big way. It's kind of like these opposite things happened. So you had Arnold who used his fame to become a

politician. And then on the side of that, you had Donald Trump use "The Apprentice" as a way to propel himself into all of these American homes and

make a name for himself, which eventually led to him running for President, which eventually led to him winning the presidency.

So in a weird way, "The Apprentice" is like at the nexus of pop culture and politics in America. It's crazy.

GORANI: Yes. This is telling future politicians who want to win, you've got to use some of these methods.


GORANI: Reality show methods. Twitter, you know?


GORANI: Provocative statements. It works!

PALLOTTA: Yes, forget about the Iowa caucus. Just go to the boardroom at "The Apprentice" and be host, and maybe you could be the President of the

United States some day or the Governor of California.

GORANI: Yes, I don't know. We'll see what Kanye has in store for us in a few years.

PALLOTTA: That's the next one!


GORANI: All right. Frank Pallotta, thanks very much. Appreciate it. This has been THE WORLD RIGHT NOW. Thanks for watching. I'll see you same

place, same time tomorrow. I'm Hala Gorani. "QUEST MEANS BUSINESS" is up next. Don't go anywhere.