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Early Start with John Berman and Zoraida Sambolin

Trump: "See You in Court"; Questions for Conway; Trump Agrees to Honor "One China" Policy. Aired 4:30-5a ET

Aired February 10, 2017 - 04:30   ET

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

(COMMERCIAL BREAK)

[04:30:43] MIGUEL MARQUEZ, CNN ANCHOR: President Trump gearing up for a fight after appeals court kept his travel ban on hold. How will the White House move forward?

CHRISTINE ROMANS, CNN ANCHOR: And a top Trump adviser facing congressional review after she promoted Ivanka Trump's clothing line from the White House briefing room. What's in store for Kellyanne Conway?

Welcome back to EARLY START. I'm Christine Romans.

MARQUEZ: And I'm Miguel Marquez. Happy Friday. It is 31 minutes past the hour.

Up first, President Trump licking his wounds, but vowing to fight on in the battle over the seven nation travel ban. unanimous ruling by a three-judge panel means citizens of those Muslim majority countries can travel freely to the United States, assuming they completed the required paperwork. The Ninth Circuit judges determining the government relied too heavily on the use of executive power to implement the ban.

The president firing his Twitter account, moments after the decision, saying "See you in court. The security of our nation is at stake."

Moments later, he spoke to reporters in the White House.

(BEGIN AUDIO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: It's a political decision and we will see them in court and I look forward to doing it.

REPORTER: So, you believe the judges made a political decision?

TRUMP: We have a situation where the security of our country is at stake. And it's a very, very serious situation. So, we look forward -- as I just said -- to seeing them in court.

UNIDENTIFIED FEMALE: Thanks, guys.

REPORTER: Do you believe this has undercut the first days of our presidency? This is such a core issue.

TRUMP: No, this is just a decision that came down, but we'll win the case.

(END AUDIO CLIP)

ROMANS: Democrats and refugee groups applauding the court ruling. The next step for the department of justice, seek reexamination of the case by a larger panel of Ninth Circuit judges or appeal the decision directly to the Supreme Court.

Let's go live to Atlanta and bring in Michael Moore, the former U.S. attorney for Georgia's middle district.

Nice to see you again. And when we read this ruling, you can see point by point by point a unanimous rejection of each of the points the government made to that panel.

MICHAEL MOORE, FORMER U.S. ATTORNEY, MIDDLE DISTRICT OF GEORGIA: Yes. I really don't think you can overstate the significance of the rebuke the court gave to the Trump administration. And there are a couple of things that struck me right off when I read the decision. The first was, this was written for the entire court. So, three judges signed off on the opinion. So, it's a per curiam decision, which simply means it is not just divided along party lines liberal or conservative justices, one way or another.

The other was, take a look at tit. A George Bush appointee was part of the decision and part of the court order I thought was significant. The court indicated a very strong dislike for the administration's argument that in fact the court didn't have the authority to review the court's decision. I thought that was interesting, too, that they clearly didn't like that. They clearly made the point that the order has to stand up to constitutional scrutiny. So, it's -- we move forward now and see where we go after that.

MARQUEZ: I mean, reading it, it does read like a bit -- maybe a complete slap-down of the government's sort of take on this, on standing and reviewability and due process and religious discrimination. All those points they basically said, it's just not there. We're not going to do your homework for you. We're not going to rewrite the order. We're not going to allow you to change it midstream.

They also didn't get into the merits of the case. But our Jim Sciutto had a conversation with the former head of the DNI. Here's what he said about the threat from those majority Muslim countries.

(BEGIN VIDEO CLIP)

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT: Does the terror threat necessitate the ban from these seven countries?

JAMES CLAPPER, FORMER DIRECTOR OF NATIONAL INTELLIGENCE: Well, I don't believe we in the IC were away of any extraordinary threats that we aren't already dealing with. SCIUTTO: Does a ban like this in your view, does it damage U.S. image

but also counterterror partnership?

CLAPPER: Yes. I worry about those countries in question with whom we deal and who are reliable partners.

(END VIDEO CLIP)

MARQUEZ: So, he is basically saying, Jim Clapper, DNI, the ex-head of DNI, is saying that there wasn't any threat from these countries. I mean, when it goes to the next step, the district court or Supreme Court, will that be a consideration?

[04:35:05] MOORE: I think it will. This is a case where Trump's words have come back to haunt him. You know, the court even referenced it in the decision. Some of the things said during the campaign. Some of the things that have been said by supporters.

Really looking at whether or not the intent behind this executive action had some religious animus. I think the court was pretty clear, and I said, look, the Constitution is not written in invisible ink. It doesn't disappear because you shine a light of a national security claim on it. There are protections that will apply to people. And we have to look and we have the authority to look and see if the executive acted within the constitutional scope of his or her authority.

I think what will likely happen is we will get other evidence. The case is likely to go back to district court. The judge set the case up on a rather expedited briefing schedule. And then evidence will come in and the parties will decide who's deposition they want to take. In fact, the state may decide we may take the deposition of the president, we want to look at e-mails that have gone back and forth between White House staffers to find out were there hidden motives behind this executive action. Was it just for political purpose? Was it truly for national security?

Those have all yet to be decided. I think what you just have to remember as of today, what we know is that we have not reached the merits of the case. The court just said, look, we are going to leave the stay in place. We don't think the government met its burden to show that it was appropriate the lift the say.

So, it's a complete rebuke really when you look at the fact it's unanimous decision of the executive actions in the case. You will decide whether or not they want to go right to the Supreme Court and they decide whether or not they want a hearing en banc before the Ninth Circuit or let it work through. They had the option if they wanted to try to rewrite the order. They were offered to do that.

ROMANS: All right. Michael Moore, nice to see you this morning.

MARQUEZ: Thank you.

MOORE: Good to see you.

ROMANS: Fascinating, fascinating legal turn.

All right. Congressman Tom Price confirmed in the middle of the night to become the next secretary of health and human services. The vote, 52-47, along party lines. Democrats bitterly oppose the Georgia Republican for his opposition to the Affordable Care Act and his desire to overhaul Medicare. Price also overcoming ethical concerns over a series of questionable stock trades.

MARQUEZ: Now, Kellyanne Conway managing to unite Democrats and Republicans. Something you didn't think was possible. Trouble is, they are united against her. We'll tell you why.

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(BEGIN VIDEO CLIP)

[04:41:41] KELLYANNE CONWAY, COUNSELOR TO THE PRESIDENT: Go buy Ivanka's stuff is what I would tell them. I'm going to go get something myself. It's a wonderful line. I own some of it. I fully -- I'm just going to give -- I'm going to give a free commercial here. Go buy it today, everybody. You can find it online.

(END VIDEO CLIP)

MARQUEZ: That endorsement by Trump adviser Kellyanne Conway during an interview from the White House briefing room triggering both ethical and legal concerns about using her position to promote a Trump family business.

Critics quick to pounce. There's even a bipartisan call for an investigation. The top Democrat in the House Oversight Committee, Elijah Cummings, and Republican Chairman Jason Chaffetz, sending a letter to the government ethics office concerning possible disciplinary action. Chaffetz calling Conway's comments wrong, over the line and unacceptable.

Asked about the uproar, Conway said this.

(BEGIN VIDEO CLIP)

CONWAY: We are aware of the letter and we are reviewing that internally. I'm just really happy that I spend an awful lot of time with the president of the United States this afternoon and that he supports me 100 percent.

(END VIDEO CLIP)

ROMANS: White House Press Secretary Sean Spicer says Conway has been counseled but didn't elaborate on exactly what that means. And we're told Conway did acknowledge making a mistake. No comment so far from Ivanka Trump. I think that's fascinating she is silent on this.

MARQUEZ: What's to gain by talking?

ROMANS: It's all begun after the president said Nordstrom treated his daughter unfairly about dropping her product line. MARQUEZ: Joining us now to talk about more about all this and

Kellyanne Conway's misstep and another week of White House dustup, that seems too light, Brian Stelter, CNN senior media correspondent and the host of "RELIABLE SOURCES."

Dustup seems very light. This has been a bit of a train wreck, I think. I mean, you have a president who is not your normal president saying things his staff is trying to clean up. I want to play the Spicer sound for you talking about the Kellyanne Conway stuff first.

(BEGIN VIDEO CLIP)

SEAN SPICER, WHITE HOUSE PRESS SECRETARY: Kellyanne has been counseled. And that's all we're going to go on. She has been counseled on that subject. And that's it.

(END VIDEO CLIP)

MARQUEZ: That's the spokesperson for the president of the United States of America. One, we don't know what counseled means. But his lack of really a response.

BRIAN STELTER, CNN SENIOR MEDIA CORRESPONDENT: Yes. It makes you wonder, was she counseled before she said this on FOX, almost doing an infomercial for Ivanka? Was she counseled after? I'm guessing she was counseled after the interview.

The Office of Government Ethics website was overwhelmed by this yesterday. The website crashed because there were so many people, probably a lot of anti-Trump liberals trying to log on to the site, trying to express their concerns about what she said on FOX. You saw by the evening, she was chastened about this, having a different tone about it, makes you wonder if everybody at the White House is on the same page when it comes to the very bright lines that are supposed to be drawn between the presidency and Trump's personal businesses.

ROMANS: It shows no line whatsoever. I mean, it shows a Trump White House. That episode shows a Trump White House that is same as brand Trump, just the same identity.

And can that be allowed? I mean, could there be legal ramifications I wonder?

STELTER: It also shows our culture wars, for lack of a better phrase, you know? You're either with Ivanka Trump, with Donald Trump, or against them. You're either buying their clothes, their products, or you're rejecting their clothes and products.

I don't know about you, guys. I wish I could go to a store and not think about politics that are associated with that particular brand.

[04:45:04] But everything has been politicized in this country.

ROMANS: To go a step further. Look at other countries. Do other leaders behave differently in the approach to the United States because they don't want to anger Trump? Do they start to invest in Trump properties or do things to curry favor with Donald Trump? It is all so tightly combined. You wonder.

Let me ask about Sean Spicer. It's been a tough week for Sean Spicer. He started, you know, with a big -- he was impersonated on "Saturday Night Live." And he's been -- there is a reason they pass a flack jacket to every press secretary. But he needs full body armor.

STELTER: You're absolutely right. I mean, he is up dismissing questions from journalists, saying some of the questions are downright silly and moving on and not answering. The correspondents I talked to say, hey, at least we have a chance to ask questions. We are not getting answers from the White House.

Spicer, though, is in an impossible position because of his boss. President Trump most mornings is setting the tone, setting his own agenda via Twitter and via Facebook, setting the tone for the day, creating comments. The press secretary has to be asked.

Great example yesterday, Trump made a comment on Twitter about how we are bogged down around the world in various conflicts. Spicer was asked, where are we bogged down? What places is the United States losing essentially? And he wouldn't answer the question.

One of the many examples of Trump on Twitter starting the day off and creating problems for aides.

MARQUEZ: But it raises the strong point of Kellyanne Conway and alternative facts and Bowling Green and Sean Spicer and all his issues in recent days. I mean, the White House has to get its message out. This is not going well if this continues.

STELTER: And right now, the overarching message I hear, I wonder what you all think is, we're in danger. There are threats to the White House which is trying to keep people safe. That all caps tweet from Donald Trump sums it up very nicely, the security of our nation is at stake.

The experts say otherwise, say actually, there's not this imminent threat that Spicer has been alluding to. Sometimes Spicer sounds like he is on the show "24", that ticking time bomb scenario. So, there's tension about how much danger there really is, I think that's the overarching message if there is one from the White House. However, there is so much noise, so much clutter. I feel bad for the viewers as I watch to cut through every single day with this White House.

But it is a new administration. It is a brand new government, people taking over. You've got to give him time to get into the jobs.

ROMANS: Wrapping up the third official week of the Trump presidency.

All right. Brian Stelter, come up, we'll talk to you soon.

MARQUEZ: Thank you.

Nordstrom showing a presidential tweet doesn't also sink a stock. Look at the shares up 7 percent over the past two days. Record highs yesterday. So, you know, that helps. But Nordstrom said it was a business decision to drop the Ivanka Trump brand.

Traditional retailers were struggling. So, analysts say if the line were selling, you know, it would have stayed. That rise coming as the market hit those records after stalling for the past few sessions.

The rally got a jump start right after the open. What was the catalyst? Oh, the president, he met with airline executives and he said this.

(BEGIN VIDEO CLIP)

TRUMP: So, we want to help you realize these goals by rolling back burdensome regulations and you people are regulated, probably as much as almost anybody, although I can't think of a couple of industries that are even worse. Lowering the overall tax burden on American businesses, big league, that's coming along very well. We're way ahead of schedule, I believe. And we're going to be announcing something, I would say, over the next two or three weeks that will be phenomenal in terms of tax.

(END VIDEO CLIP)

ROMANS: OK, what really sparked stocks? Two to three weeks, a timeline for a plan to lower taxes. Wall Street has been waiting for those words. Now, it seems like a plan is coming. Investors pushed stocks to new highs.

Comprehensive plan in two to three weeks.

MARQUEZ: And you have to get that plan passed.

ROMANS: Blah, blah, blah.

MARQUEZ: Welcome to Friday. That's the big one.

ROMANS: You're right.

MARQUEZ: President Trump with a big diplomatic move in a phone call with the Chinese president.

We're live in Beijing coming right up.

(COMMERCIAL BREAK)

[04:53:15] ROMANS: Breaking overnight: President Trump agreeing to honor the one China policy during a phone call with Chinese President Xi Jinping. The president angered China in December, you'll recall, by speaking directly to the prime minister of Taiwan.

I want to get the latest from CNN's David McKenzie live from Beijing.

Give us the back story here, why the president is doing this now?

DAVID MCKENZIE, CNN CORRESPONDENT: Well, Christine, really, it had to happen at some point from the Chinese perspective, because without President Trump recognizing the one China policy, the relationship between the U.S. and China would be a nonstarter. I have been talking to several Chinese and U.S. experts who said this had to happen at some point. It is, though, a turn around from President Trump who previously said maybe the issue of Taiwan which China sees as a renegade province would be on the table for negotiation.

But in the end, coming around to the thinking that the U.S. has had since 1979, recognizing China as the only China and Taiwan as not a separate country has really been the basis of all relationships from them with China. Now, they can get down to the tough decisions and talk about trade, foreign policy, climate change. But this shift in tone and substance from President Trump would be welcome here in China, though the relationship between the two countries, perhaps the most important bilateral relationship for the U.S., could continue to be tricky. But this is a way to get that relationship going -- Christine.

ROMANS: He said repeatedly that China is killing the U.S. on trade, although he used more crass and vulgar terms.

[04:55:00] And he has been very sharp critic of Chinese trade policy. So, we'll have to see where that goes from here.

Thanks for that, David McKenzie.

MARQUEZ: Democratic Senator Richard Blumenthal is calling on Supreme Court nominee Neil Gorsuch to go public with his criticism of President Trump. Blumenthal is one of two Democratic senators who were told by Judge Gorsuch that he finds the president's attacks on the judiciary disheartening and demoralizing. Mr. Trump claims Blumenthal is misinterpreting Gorsuch's remarks and the White House Press Secretary Sean Spicer is backing up the president.

(BEGIN VIDEO CLIP)

SPICER: The judge was very clear that he was not commenting on any specific matter, right? And then he was asked about his general philosophy. So, you can't then take that, equate it back to the specific. He literally went out of his way to say, "I'm not commenting on a specific instance."

(END VIDEO CLIP)

MARQUEZ: Gorsuch's spokesman confirms that the judge made the comments to Senator Blumenthal. The senator also says Gorsuch told him he should feel free to mention his thoughts publicly.

ROMANS: Let's get a check on CNN Money Stream this Friday morning. All three major averages sitting at record highs. And it looks like more gains at the open.

Dow futures are up, S&P futures higher as well. Stock markets in Europe and Asia are rising, including a big gain in Tokyo. Excuse me, most of the optimism coming from President Trump who says tax reform will be ready in the next few weeks.

MARQUEZ: Trump made those comments to reporters but his love of Twitter had analysts thinking most users would flock to the struggling social platform. That is not happening. Shares of Twitter tanking 12 percent after its earnings report Thursday morning near an all time. Sales increased just 1 percent last quarter. Wall Street was expecting a much bigger rise. That was due to weak advertising revenue, an ongoing problem for Twitter. It also can't seem to grow user base.

ROMANS: Twitter has 319 million monthly active users. That's up just 2 million from the quarter before. So, think about that. They only nabbed 2 million more customers.

MARQUEZ: Amazing.

ROMANS: Snapchat, which is relatively young as far as the social network goes, has less, but it's growing quickly. Instagram has nearly double Twitter's total. Facebook is king with 1.8 billion.

Donald Trump meeting with the airline executives at the White House there. And the big topic of conversation, the country's outdated air traffic control system. The president says the current plan to modernize it is not good enough.

(BEGIN VIDEO CLIP)

TRUMP: I hear we're spending billions and billions of dollars. It's a system that's totally, you know, out of whack. It is way overbudget. It's way behind schedule. And when it's complete, it's not going to be a good system. Other than that, it's fantastic.

(LAUGHTER)

(END VIDEO CLIP)

ROMANS: Some of the CEOs in attendance urged the president to privatize the air traffic control system. Take it out of Federal Aviation Administration control. No official comment on that from the White House. But executives leaving the meeting say that plan is on track.

He said that a pilot -- he gets a lot of his advice from his pilot, a lot of information about the air traffic system --

MARQUEZ: Taking the air traffic control out of the hands of the government would be an interesting move. Given that security at the airport went to the government after 9/11.

ROMANS: Right, privatizing security for for-profit gain, that's a very new model.

MARQUEZ: EARLY START continues right now.

(MUSIC)

MARQUEZ: President Trump ready to fight after an appeals court ruled his travel ban must remain on hold. What's the next move for the White House? We are live in Washington, D.C. ROMANS: And big questions for a top Trump advisor after she peddled

Ivanka Trump's clothing line on television. Could Kellyanne Conway face legal trouble?

Good morning and welcome to EARLY START, everybody this Friday morning. I'm Christine.

MARQUEZ: Nice Friday.

I'm Miguel Marquez. It is February 10th, 5:00 a.m. here on the East Coast.

First up, President Trump down, but not out in the battle over his controversial seven-nation travel ban. Unanimous ruling by a three- judge panel means citizens of seven Muslim majority countries can legally travel to the United States. The Ninth Circuit court justice determining the government relied too heavily on the use of executive power to implement the ban.

ROMANS: So, the president fired up his Twitter account moments after the decision, saying , "See you in court. The security of our nation is at stake." All in caps there.

Moments later, he spoke to reporters in the White House.

(BEGIN AUDIO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: It's a political decision and we will see them in court and I look forward to doing it.

REPORTER: So, you believe the judges made a political decision?

TRUMP: We have a situation where the security of our country is at stake. And it's a very, very serious situation. So, we look forward -- as I just said -- to seeing them in court.

UNIDENTIFIED FEMALE: Thanks, guys.

REPORTER: Do you believe this has undercut the first days of our presidency? This is such a core issue.

TRUMP: No, this is just a decision that came down, but we'll win the case.

(END AUDIO CLIP)

ROMANS: You can hear an adviser, an aide to the president trying to move the conversation along.

For the latest on the ruling and next step in the legal fight, I want to go to Washington and bring in our CNN justice correspondent Laura Jarrett who has been working around the clock, I can assure, waiting for and then analyzing this decision.

Good morning, Laura.

LAURA JARRETT, CNN JUSTICE CORRESPONDENT: Good morning, Christine.