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Report: 227,000 Jobs Created in January; Trump Administration Ramps up Rhetoric on Iran; Trump Adviser Cites Non-Existent "Massacre". Aired 9-9:30a ET

Aired February 3, 2017 - 09:00   ET

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


[09:00:00] ALISYN CAMEROTA, CNN ANCOR: We know that you'll still be part of the family, but we are sure going to miss you, Carol.

CAROL COSTELLO, CNN ANCHOR: I've been crying all morning. Really, I have. People have been so wonderful.

CHRIS CUOMO, CNN ANCHOR: Will you miss me?

COSTELLO: Oh, my. I'll miss you the most. I have a picture of you that I'm taking --

CUOMO: Are you sure?

COSTELLO: No, I'm taking a giant picture --

CUOMO: Because you usually push me by the face out of the way when you see me.

COSTELLO: No. I have my giant picture of Chris Cuomo that I'm going hang in my office in Los Angeles. Not.

(LAUGHTER)

CAMEROTA: Best of luck, Carol.

CUOMO: The best to you. I'm sure I'll see you anyway. I'll be on some remote location. You'll be asking me questions I can't answer.

COSTELLO: Exactly. Thank you, guys. It's been a wonderful run here at CNN. NEWSROOM starts now.

And good morning. I'm Carol Costello. Thank you so much for joining me, and we do begin with breaking news.

The unemployment numbers are out, 227,000 jobs created last month and a hiring surge that's much bigger than expected. CNN Chief Business Correspondent Christine Romans is here to break it all down for us.

Good morning.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Good morning. Starting the year on a strong note with hiring 227,000 new jobs in January. That is a strong performance and continuing a pretty strong pace we have seen over the past few months. You can see that January is the strongest we've seen since the summer.

Here is where the job gains are, Carol. In retail, 46,000 jobs there. In construction, Carol, I got to tell you, for the year, about 170,000 construction jobs added. There's a lot of residential building. There's some business groundbreaking as well and so that leads into construction jobs.

And in business, these tend to be higher paid jobs. We're talking about lawyers. We're talking about people who work in information technology, computer systems designer. Every month, I see a lot of job creation in that category. So those are how the job gains break out.

When we look at the unemployment rate, you can see just how dramatically it has fallen. From those terrible days of 10 percent after the financial crisis, now sitting there at 4.8 percent. Carol, this is a number that many economists consider very close to full employment.

And CEOs, including many of the CEOs who will be meeting with the President this morning, they have been saying that they're having trouble finding qualified workers for jobs. There are several million jobs open in America right now, Carol.

COSTELLO: So Donald Trump is going to be meeting with the CEOs of these companies. But I don't know if it will be an entirely friendly meeting because the Uber CEO has pulled out of the meeting, and --

ROMANS: That's right. He got a lot of blowback from his customers and his shareholders, and frankly, his employees because they thought that it was an endorsement of Donald Trump's policies by going to that meeting. There are other CEOs, though, who say they will still be going because they want to have a seat at the table, and they want to be able to tell President Trump what they don't like about his travel ban or what they would like to see changed.

Don't forget, they've also been promising a tax reform. There are beginning stages of tax reform on Capitol Hill, so many of these CEOs want a seat at the table. It's a tightrope they have to walk because one tweet can throw their stock into turmoil. One tweet from the President can, you know, mean their P.R. machine has to go into overdrive.

They want to be there at the table to push and to talk about how much they are making in America or how many employees they have in America. But they also don't like some of the policies that he has.

COSTELLO: Well, they also have to appeal to their consumers. And the one company I think is walking the tightest tightrope, and that you can see it being played out, is Budweiser, right?

ROMANS: Absolutely.

COSTELLO: With that immigration ad that it has decided to go ahead and run during the Super Bowl. ROMANS: And, you know, the company says that wasn't a political ad.

This is just an ad that had been in the works for some time. That it is an ad about the founding of this company, about a man from Germany who faced discrimination and anti-immigrant backlash, anti-German backlash, and came to this country and made a huge fortune and a huge company. They're saying this was not meant to be political, but there are some Trump supporters who are saying, we're not going to drink that beer.

COSTELLO: Yes. But it's going to run during the Super Bowl, and we'll all be watching it.

ROMANS: We will.

COSTELLO: Christine Romans, many thanks.

OK. So President Trump firing out a string of tweets early again this morning. He is keeping up the tough talk in Iran. He says the country is, quote, "playing with fire" as his administration considers new sanctions on the heels of Iran's missile test.

And then there's Russia. Trump's Ambassador to the United Nations hitting Moscow hard over some military incursion in Ukraine. In the meantime, the White House is now saying that Israel expanding settlements into the West Bank may not be helpful for peace prospects.

Our correspondents are fanned out across the globe to bring you all of the latest developments, but let's begin with CNN's Jeff Zeleny. He's at the White House.

Hi, Jeff.

JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Good morning, Carol. What we are seeing are, you know, really the emerging outlines of the Trump foreign policy doctrine here. Of course, we know what he said when he was running for President on the campaign trail, but things are often different when you have the realities of government.

So we are seeing a harder line on Russia, particularly from his Ambassador to the United Nations, Nikki Haley. This is what she said yesterday.

(BEGIN VIDEO CLIP)

NIKKI HALEY, UNITED STATES AMBASSADOR TO THE UNITED NATIONS: This escalation of violence must stop. The United States stands with the people of Ukraine who have suffered for nearly three years on Russian occupation and military intervention. Until Russia and the separatists it supports respect Ukraine's sovereignty and territorial integrity, this crisis will continue.

(END VIDEO CLIP)

[09:05:06] ZELENY: And she went on to say the sanctions would not be lifted right now if the situation remains the same in eastern Ukraine. But still more fallout from those phone calls with world leaders, particularly Australia.

The U.S. Ambassador -- the Australian Ambassador, excuse me, to the U.S. came here to the White House last night for meetings with the White House Chief of Staff to sort of smooth all this over, but John McCain had some strong words yesterday about one of our key allies.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: This, in my view, was an unnecessary and, frankly, harmful open dispute over an issue, which is not nearly important as United States-Australian cooperation and working together.

(END VIDEO CLIP)

ZELENY: But now the President was tweeting this morning that he had, in fact, a civil conversation with the Australian Prime Minister. He said reports otherwise simply aren't accurate, but, Carol, that's not what he said yesterday. He said straight talk and tough talk is what he is going to give.

But one of his other tweets this morning on Iran, also, is so interesting as this White House is leaning toward more sanctions. He says this, "Iran is playing with fire - they don't appreciate how kind President Obama was to them. Not me!"

Carol, that seems to be a little bit of a pushback on some morning story lines that his foreign policy, at least in some select areas, sounds a lot like President Obama's.

But one thing we're watching for here at the White House, when he meets with those CEOs at the top of the next hour, Carol, is how the President reacts to the jobs numbers. He talked throughout his campaign about how this was actually not a real unemployment rate. Now, this is the benchmark for his presidency, that 4.8 percent that Christine was talking about. We'll see how he responds to that, Carol.

COSTELLO: We're eagerly awaiting another tweet from Mr. Trump. Jeff Zeleny reporting live from the White House.

All right. Let's get right to our CNN Senior International Correspondent Clarissa Ward. She's live in London with Iran's response to President Trump's latest tweet.

Hi, Clarissa.

CLARISSA WARD, CNN SENIOR INTERNATIONAL CORRESPONDENT: Hi, carol. Well, that's right. We've heard from Iran's Foreign Minister who has spoken out against the rhetoric we've heard coming from the Trump White House.

He took to Twitter to say, "We will never use our weapons against anyone except in self-defense." He also said separately, "Iran unmoved by threats as we derive security from our people. We will never initiate war but we can only rely on our own means of defense." So Iran really keen to emphasize that this missile test, which has

precipitated all of this, was specifically intended for defensive purposes. And it is important to note to our viewers that the missile test is not in contravention of the Iran nuclear agreement.

We have heard some, also, rather more bellicose bluster from an adviser to the Iranian Supreme Leader. He warned President Trump not to, quote, "make a toy out of himself" with his, quote, "breathless ranting." And he also called NSA Director General Flynn an inexperienced person who has made an illogical claim, referring there, of course, to General Flynn's comment earlier this week that Iran has been placed on notice.

That is something we have heard President Trump echo, and he has said he would not rule out military force. So definitely ratcheting up with the rhetoric here, Carol.

COSTELLO: All right. Clarissa Ward reporting live from London for us.

So Donald Trump's foreign policy is a work in progress, and it appears it will partially be crafted via Twitter in the early hours of the morning. So let's talk about all of these.

With me now is CNN Military Analyst General Spider Marks and David Rohde, CNN global affairs analyst. Welcome to both of you.

DAVID ROHDE, CNN GLOBAL AFFAIRS ANALYST: Thanks, Carol.

COSTELLO: General Marks, the President of the United States tweeted this, "Iran is playing with fire - they don't appreciate how kind President Obama was to them. Not me!" General Marks, there are U.S. Navy ships in that region. Things are already tense between Iranian vessels and American war ships. Do these tweets matter?

MAJ. GEN. JAMES "SPIDER" MARKS (RET.), CNN MILITARY ANALYST: Well, Carol, they do. And if I may, Carol, can I tell you, thank you, we've had a number of conversations over the years, and you've been an absolute pro. So thanks for all that you've done by putting a spotlight on some very tough topics.

To answer your question, yes, they are provocative. We have to understand that words matter and how our senior leaders engage are a matter of practice. And our Commander-in-Chief has indicated that Twitter is, in fact, a way that he will communicate in very summarized way, 140 characters, what he is thinking.

The challenge with that is that, within that very limited amount of space and characters, there is room for an immense amount of interpretation. And when you have sailors, soldiers, airmen, and marines at risk in a very, very dangerous and chaotic region, this becomes complicating.

[09:10:06] COSTELLO: OK. So another question I had, and this one is for you David, you know, Trump's national security adviser, Michael Flynn, he had that warning for Iran after it fired off that ballistic missile in a test. Here is what Flynn said.

(BEGIN VIDEO CLIP)

LT. GEN. MICHAEL FLYNN, UNITED STATES NATIONAL SECURITY ADVISOR: The Obama administration failed to respond adequately to Tehran's malign actions including weapons transfers, support for terrorism, and other violations of international norms. The Trump administration condemns such actions by Iran that undermine security, prosperity, and stability throughout and beyond the Middle East, which places American lives at risk.

(END VIDEO CLIP)

COSTELLO: We didn't get to the money part. He said he was going to put Iran on notice. That was the most important line of what General Flynn said, "We're going to put Iran on notice." And I bring that part of the statement up because it reminded me somewhat of President Obama's infamous red line statement if Syria used chemical weapons. Listen to that.

(BEGIN VIDEO CLIP)

BARACK OBAMA, FORMER PRESIDENT OF THE UNITED STATES: We have been very clear to the Assad regime, but also to other players on the ground, that a red line for us is we start seeing a whole bunch of chemical weapons moving around or being utilized. That would change my calculus. That would change my equation.

(END VIDEO CLIP)

COSTELLO: So, David, is Flynn's, you know, line of thinking a red line for Iran?

ROHDE: Well, actually, first, I want to thank you as well. You've been incredibly kind to me every time I've been on the show. My mom's name is Carol, as we've talked about, so I have a soft spot.

COSTELLO: You have the best mom ever.

(LAUGHTER)

ROHDE: But in a far more serious and important note, it could be a red line. It's really up to the Trump administration whether they want to keep, you know, using this kind of rhetoric or not, that the President did again this morning in his tweet. And that's dangerous because you're boxing yourself in.

You know, the Obama administration essentially decided they had an option to either go to war, to bomb Iran, and try to remove its ability to make a nuclear weapon. It's not clear we could do that in air strikes, so they negotiated this deal. So the question for the Trump administration is, are they willing to essentially go to war with Iran?

That would have a tremendous impact on oil prices and sort of destabilize the Persian Gulf. So I don't think it's a red line, but I think they need to change this pattern of rhetoric or they're going to box themselves in as President Obama did.

COSTELLO: OK. And if they boxed themselves in -- and I say that because of this tweet that Iran tweeted out this morning, and I'm going to read it for you again. Iran tweeted out, "Unmoved by threats as we derive security from our people. We'll never initiate war but we can only rely on our own means of defense," which probably means Iran will fire off another test missile because the Iran deal does not prevent that. So what happens then, General?

MARKS: Well, the challenge truly is, what have we said our priority that would give the regime in Tehran pause? Clearly, this is not the right way to go. I think all options need to remain on the table. The challenge that we have is, when you declare that somebody is on notice or that we've established a red line, you now have to define very precisely what does that mean? What are we going to do to follow up?

What we need to be able to do is determine, is this missile testing in any way independent of their nuclear development? And frankly, it is not, so this is very provocative. What we do is we have an array of options. We have diplomatic, we have informational, military, et cetera. So there are things that we can do economically as well that could make it very, very painful for Iran.

I'm in total agreement that this is not the way that you engage at this point with a developing capability. That becomes incredibly more destabilizing.

COSTELLO: So, David, what if the Trump administration imposes more sanctions on Iran? What if that happens?

ROHDE: Well, they won't have much effect. We have very little, you know, economic interaction with Iran. The strength of the Iran nuclear deal for supporters of it is that Europe, Russia, everyone, sort of backed the sanctions before that led to the deal.

So the Trump administration would be unable, I think, to get European countries, you know, Russia and other countries, to agree to these new sanctions. So they would essentially be toothless, and that's the challenge. You know, there's fewer and fewer tools here available to pressure Iran.

COSTELLO: Well, we'll have to sit back and watch what happens.

Major General James "Spider" Marks and David Rohde, thanks so much.

Still ahead in the NEWSROOM, a Trump advisor defending the immigration ban by invoking the, quote, "massacre" in Bowling Green, Kentucky. The problem is, there was no massacre. It never happened. A fact check next.

(COMMERCIAL BREAK)

[09:18:50] CAROL COSTELLO, CNN ANCHOR: Here is a fact. We here at CNN never covered the Bowling Green massacre. We never did. And here's another fact, there is no such thing as the Bowling Green massacre. With that said, I want you to hear what Trump adviser Kellyanne Conway said on another network. She was defending Trump's temporary ban on refugees from seven Muslim majority nations. Here it is.

(BEGIN VIDEO CLIP)

KELLYANNE CONWAY, TRUMP SENIOR ADVISER: These are nations very narrowly prescribed and also temporary.

UNIDENTIFIED MALE: Sure.

CONWAY: I bet there was very little coverage. I bet it's brand new information to people that President Obama had a six-month ban on the Iraqi refugee program after two Iraqis came here to this country, were radicalized, and they were the master minds behind the Bowling Green massacre. Most people don't know that because it didn't get covered.

(END VIDEO CLIP)

COSTELLO: That's because it never happened.

CNN's Jeff Zeleny is live at the White House. So that's not the only untruth Kellyanne Conway uttered during that interview, is it?

JEFF ZELENY, CNN SENIOR WASHINGTON CORRESPONDENT: It's not, Carol. Let's put our fact-checking hats on, shall we? And let's go through this. Let's sort of break this down a little bit so people know the facts and what actually did happen. Now she said that President Obama put a six-month ban on Iraqi refugees. That actually did not happen. Let's take a look at these fact checks sort of one by one.

[09:20:05] He did not ban the refugee program. These two Iraqis living in Bowling Green, Kentucky, were arrested in 2011 on terror charges. Now these two men were monitored by federal authorities but they were never planning an act of terror on U.S. soil. They were trying to help get weapons to Al Qaeda in Iraq. But these two men did not kill anyone in Bowling Green or anywhere else in the U.S. It simply did not happen.

So this is one of the things that it's been out there in the ether, some conspiracy theories, some other things, but the senior adviser to the president saying that the media ignored it simply isn't true.

So Kellyanne Conway who again was the campaign manager and now a top adviser to this president, who does a lot of interviews, she is now backtracking somewhat this morning and she is sending out a flurry of tweets. But she's saying that she meant to say Bowling Green terrorists as opposed to massacre. But also others are joining in the fray. Chelsea Clinton is tweeting this morning that Miss Conway and others should be more accurate with their facts about not creating attacks.

So, Carol, the reason why this is important, the reason we talk about it is the attack didn't happen and it just isn't true. So, anyway, we'll go on with our day here but --

COSTELLO: Perhaps, Jeff -- perhaps this was just an alternative fact because remember when Kellyanne Conway said this?

(BEGIN VIDEO CLIP)

CONWAY: Don't be so overly dramatic about it, Chuck. You're saying it's a falsehood. And they're giving -- Sean Spicer, our press secretary, gave alternative facts to that. But the point remains --

CHUCK TODD, MSNBC ANCHOR: Wait a minute. Alternative facts? Look, alternative facts are not facts. They're falsehoods.

(END VIDEO CLIP)

COSTELLO: Plus, Jeff, it did take her 13 days to correct the record, correct?

ZELENY: Right. I mean, alternative facts aren't anything that I learned in journalism school or in my, you know, 25 years as a reporter. You either, I'm sure, Carol. So the reality is facts are facts. And the facts this morning are that there was no Bowling Green massacre. Kellyanne Conway knows that. She's trying to walk this back now. But again, it is one thing about, you know, the delegitimization of the news media and what you can believe is a dangerous thing because this simply did not happen, Carol.

COSTELLO: Jeff Zeleny reporting live from the White House. Thanks so much.

So let's talk some more about this. Here with me, CNN senior political analyst and senior editor at the "Atlantic" Ron Brownstein, and CNN political analyst and Washington bureau chief for "The Daily Beast," Jackie Kucinich.

So, Ron, either Kellyanne Conway lied or she didn't do her homework. Do you care to say which is true?

RON BROWNSTEIN, CNN SENIOR POLITICAL ANALYST: Obviously I don't know what was going through her mind when she said that. It's hard to believe that you would go on television and simply make up a massacre and not believe that you would get called on it sooner or later. The part of it, though, that makes me think this was not just a mistake, and that this was -- there was something in her head that was deliberate here is when she said not only did it happen, but then added that kind of little twist of the screw at the end, the media didn't cover it, which is kind of the -- you know, this kind of argument that you hear on the kind of fringes of the political conversation that the media is covering things up all of the time.

So, look, I mean, you know, this is something that was clearly unequivocally wrong. They pilloried -- they have pilloried reporters when they have gotten things wrong. She tweeted out this morning, everybody take a deep breath. You know, the standards here seem to be applied differently. But I think this is so -- this resonates so much because it's an administration that already has shown on so many fronts that it's willing to push the boundaries of the truth.

COSTELLO: OK. Wait a minute before I ask Jackie a question, I'm going to take a deep breath.

BROWNSTEIN: Deflating.

COSTELLO: OK, I'm ready now. Jackie, that isn't the only untruth she said in that interview with MSNBC. She also brought up -- you know, and Mr. Trump brings it up, too, that the Obama instituted a refugee ban on Iraqis which isn't true. They slowed down the process but they never banned Iraqi refugees from coming into the United States.

JACKIE KUCINICH, CNN POLITICAL ANALYST: You know, this is the latest thing the Trump administration has said to fear-monger about refugees. In that tweet that was mentioned where Kellyanne corrected herself and said she meant Bowling Green terrorists. She linked to an old 2013 story that again was talking about -- ended up being unfounded fears about refugees. But this isn't the first time we've seen them do this. They talked about San Bernardino and could that have been stopped. Well, it couldn't have. This is someone who was an American.

Then you had -- they've also, on the campaign trail, Trump mentioned Orlando. Again, this is someone who was an American. So this continue to fear monger against refugees and immigrants in general is just an unfortunate, consistent, though, thing the Trump administration keeps doing. And it's up to us to fact check them every step of the way and stop this.

[09:25:10] COSTELLO: Well, here is the biggest concern, Ron. Conway is in charge of messaging at the Trump White House. Is this the kind of messaging we should just come to expect?

BROWNSTEIN: Well, alternative facts, I think, told you a lot of what you need to know. I -- look, people understand -- I don't think anybody -- like I said, I can't imagine that you would go on and think you would get away with creating a massacre that didn't exist. There was something in her head that she thought she was referring to. But, you know, it got obscured by the fact that Hillary Clinton faced such enormous doubts about her honesty and trustworthiness during the campaign. But almost as many people in polling consistently have doubted whether Donald Trump is telling the truth.

And that is a reality --you know, facing this administration. You know, he famously said I could walk out on Fifth Avenue and shoot somebody and I wouldn't lose any support. That is not literally true. I mean, the CBS poll came out today with a 40 percent approval rating. Gallup has him in the low 40s. He is already -- first of all, that is far lower than anybody has been this quick into his presidency. He got the majority disapproval eight days into his presidency in Gallup.

For President Obama it was 600 days. For George W. Bush, it was 1200 days, for Ronald Reagan, it was 700 days. What that says is there are people who are listening, who are paying attention to the policy, paying attention to what he said. And it is not true that his entire base of support in the campaign is completely immune to these kinds of controversies.

COSTELLO: I have a tangible example of that. So the voter fraud investigation that Trump insisted he was going to push forth hasn't come to fruition, right, Jackie? So did that just get lost somewhere along the line or did they just figure out that the American people kind of saw through this thing?

KUCINICH: Well, it's hard to investigation something that isn't there. And that's sort of what they ran into. Also, you know, we're talking about -- if we're talking about -- it's one thing to say these things on the campaign trail. When you actually have to spend taxpayer dollars on something, it doesn't really make a whole lot of sense to do that on something that is pure fiction.

COSTELLO: All right. I have to leave it there. Ron Brownstein, Jackie Kucinich, many thanks.

Still to come in the NEWSROOM, replace and repeal, repair? For Republicans the way forward on Obamacare is a bit confusing.

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