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Trump Backs Off Two-State Solution; Senators Seek Transcripts Of Flynn's Russia Calls; House Republicans Want Investigation Of Leaks; Trump Dodges Questions About Russia Contacts; Russia Deploys Missile In Apparent Treaty Violation; U.S. And Russian Diplomats To Meet In Germany; Democrats Call Emergency Meeting On Trump-Russia Ties; Labor Secretary Pick Andrew Puzder Withdraws; U.S. Considering Sending Ground Troop To Syria; Trump and Netanyahu Seek Warmer U.S.- Israeli Relations; Mattis Reaffirms U.S. Commitment to NATO But With a Price; North Korea Missile was Gift to Late Leader Kim Jong-Il; Iran Welcomes U.S. Wrestling Team After Travel Ban Scuffle. Aired 1-2a ET

Aired February 16, 2017 - 01:00   ET

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


[01:00:00] MICHAEL HOLMES, CNN INTERNATIONAL CORRESPONDENT AND ANCHOR: You're watching CNN NEWSROOM live from Los Angeles.

ISA SOARES, CNN INTERNATIONAL CORRESPONDENT AND ANCHOR: Ahead this hour, growing calls for an investigation into President Trump's associates and alleged contacts with Russia.

HOLMES: Also, the two-state solution could turn into a one-state solution. Donald Trump meets Benjamin Netanyahu and upends U.S. Middle East policy.

SOARES: And then later, a second suspect has been arrested in the mysterious death of Kim Jong-un's half-brother. Hello, and thank you very much for joining us. I'm Isa Soares in London.

HOLMES: And I'm Michael Holmes in Los Angeles. And this is NEWSROOM L.A. And we begin with new demands from two powerful U.S. Senators for more information on former National Security Adviser Michael Flynn. The Top Democrat and Republican on the Judiciary Committee are asking the FBI and Justice Department for a briefing and full transcripts of Flynn's phone calls with Russia's U.S. Ambassador. Flynn was forced to step down on Monday. One leading Democratic Congresswoman says, she wants an independent bipartisan investigation.

(BEGIN VIDEO CLIP)

DEBBIE WASSERMAN SCHULTZ, UNITED STATES CONGRESSMAN FROM FLORIDA: With every passing day, it gets more and more disturbing, and more and more evidence that there was collusion and a relationship between the Russian's desire and successful outcome in -

UNIDENTIFIED FEMALE: Collusion?

WASSERMAN: Yes, collusion.

(END VIDEO CLIP) HOLMES: Meanwhile, in the House of Representatives the Chairman of the Oversight and Judiciary Committees are going in the opposite of direction. They want an investigation into the leaks surrounding the Trump teams contacts with Russia and whether classified information was mishandled.

SOARES: While reporters looking to President Trump to clear up any confusion about Flynn are getting mixed messages or just silence. CNN's Senior White House Correspondent, Jim Acosta, has the story for you.

(END VIDEOTAPE)

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: One day after the White House said, former National Security Adviser Michael Flynn was forced out for misleading the administration. President Trump, praised the man he fired.

DONALD TRUMP, UNITED STATES PRESIDENT: Michael Flynn - General Flynn is a, wonderful man. I think he's been treated very, very unfairly by the media, as I call it the fake media in many cases. And I think it's really a sad thing that he was treated so badly.

ACOSTA: Then the President blamed leakers in the Law Enforcement and Intelligence Communities for disclosing the reporters that Mr. Trump's Top Advisers and Associates were in constant contact with Russian operatives during the campaign. Leaks he tweeted, were very un- American.

TRUMP: It's a criminal action, a criminal act and it's been going on for a long time before me. But now it's really going on. And people are trying to cover up for a terrible loss that the Democrats had under Hillary Clinton. I think it's very, very unfair what's happened to General Flynn, the way he was treated, and the documents, and papers that were illegally -- I stress that - "illegally leaked."

ACOSTA: But after dodging tough questions by calling on only conservative news outlets at his news conference with Israeli Prime Minister Benjamin Netanyahu. The President would not address a question from CNN, about whether his campaign had contacts with the Russians. An opportunity he passed on once again in the oval office.

UNIDENTIFIED FEMALE: Any comments on the reports that there was a contact between your Senior Advisers and the suspected Russian operatives during your Presidential campaign, Mr. Trump?

ACOSTA: Jim Acosta, CNN, the White House.

SOARES: Just silence there. Well, let's bring in CNN's, Clare Sebastian. She joins me now from Moscow. Very good morning to you, Clare. I want to first get your reaction or the reaction, I should say, from the Kremlin to reports that members of President Trump's entourage had regular meetings with Russian Intelligence Offices. What is the Kremlin saying, this hour?

[01:04:20] CLARE SEBASTIAN, CNN INTERNATIONAL CORRESPONDENT: Well, it's interesting Isa. Because, whether or not they took their lead from President Trump, we don't know. But the Kremlin Spokesman essentially putting this back on the media yesterday in comments on Wednesday in his call with journalists saying that, you know, don't believe reports that come from anonymous source. He said it's hard to distinguish real news from fake news. But having said that, he didn't deny it that contacts ever took place.

Certainly, this is something that we've heard from the Russian side in the past, even in the days following the election. The Deputy Foreign Minister came out and said, yes, there were contacts, but certainly no suggestion that it was anything unusual. But that doesn't mean to say that all of these reports and the leaks that are constantly being talked about here are not a cause for concern. I think there's a real concern in Moscow that these leaks are being designed to stop President Trump from carrying out some of his more pro-Russian policies.

A prominent politician tweeting yesterday that, you know, this was "The New York Times" and others, essentially trying to beat Trump with the Russia card. And this would not end with the case of General Flynn. I think, having said that though, there is a lot of concern here in Moscow as well about Trump's comments about Ukraine, him tweeting overnight. I just read it to you, "Crimea was taken by Russia during the Obama administration. Was Obama too soft on Russia?" Those comments are the ones getting the most attention here in Moscow today. Certainly, the issue of Ukraine and the issue U.S. sanctions on Russia over Ukraine, are a key priority for President Putin.

SOARES: And Clare, you mentioned there Michael Flynn. How has his resignation played out in Moscow? Because he was seen as a leading advocate of a more softer - the softer, I should say, U.S. policy on Russia, wasn't he?

SEBASTIAN: Well, absolutely. I think he was certainly seen as someone who, who was willing to consider the option of the two countries working together. He was open to the idea of a partnership between the two. And I think certainly this was something of a blow to Moscow perhaps even, a little embarrassing.

The Kremlin says, you know, this is a domestic issue and the U.S., it continues to deny that sanctions were discussed. And that this had any bearing on whether or not, you know, on whether President Putin was going to impose countersanctions on the U.S. over those sanctions that the U.S. imposed on Russia back in December. Of course, we know, that he didn't.

But, you know, among Senior Politicians, we're hearing as I said about the idea of an information war against the Trump administration, about the target being not Flynn himself, but U.S.-Russia relations. Certainly, this is being seen as something that could, you know, create a worrying pattern in terms of how the relationship unfolds.

SOARES: Well, that relationship is going to be tested today, isn't it Clare? Because Russia's Foreign Minister, Sergey Lavrov, is expected to meet its - his U.S. counterpart, Rex Tillerson in Germany. Because it's first time they're meeting, what can we expect from this meeting in light of the news or that new developments that we've seen in the last 24 or 48 hours, I should say?

SEBASTIAN: Yes. Certainly, this is going to be a closely watched meeting at any point but in light of the rather turbulent 24 or 48 hours that we've had for the U.S.-Russia relationship. I think the Kremlin certainly, will be looking for any clarity or any reassurance it can, that the Trump administration is still open to dialogue, to perhaps working together on the issue of international terrorism which is kremlin has said, is a key priority. But having said that, we hear from, you know, the U.S. administration that that may not be as smooth as the Kremlin is hoping. The U.S. administration telling reporters in Washington that Tillerson is still expected to ask Russia to use its influence to deescalate the situation in Ukraine. And it's still going to back Russian - U.S. sanctions on Russia, Isa.

SOARES: Claire Sebastian, in Moscow for us this hour. Thanks very much, Clare. Michael?

HOLMES: Thanks, Isa. Well, Senate Democrats want an answer on the Trump administration's ties to Russia. They called an emergency meeting on Wednesday, to discuss the issue even some Republican Senators are breaking ranks.

(BEGIN VIDEO CLIP)

JOHN MCCAIN, UNITED STATES SENATOR FROM ARIZONA: I think there is significant dysfunction in the National Security apparatus of the Trump administration. When you see that there, you don't know who's in charge of this Flynn situation, the whole environment is one of dysfunction in the Trump administration.

(END VIDEO CLIP)

HOLMES: And joining us now; Democratic Strategist, Dave Jacobson; and Republican Consultant, John Thomas. Let's briefly tap, we did this last hour. There have been more data, but let's touch on Michael Flynn and Donald Trump. In particular, saying that he was treated very, very unfairly and citing the fake media. How can he say he was treated unfairly? He fired him.

JOHN THOMAS, REPUBLICAN CONSULTANT: Well, I think what Donald Trump was talking about was the character assassination based upon facts, that some members of the media simply do not have. About - talking about what was said in those conversations that no one knows as the public, and all the speculation has been hurting Michael Flynn.

DAVE JACOBSON, DEMOCRATIC STRATEGIST: Well, we do know that sanctions were discussed, right? I mean, and I think the media coverage has raised questions about what other conversations have taken place? How long have those conversations taken place? "The New York Times," yesterday, came out with an electric story that I think really -

THOMAS: But those are anonymous sources though.

JACOBSON: Correct. But they - look, this is "The New York Times," are a credible news source and they have basically come out and said, look, there are high level officials within the Trump campaign, whether it was Paul Manafort or, obviously, you know other individuals who have come out, who have had on-going sort of frequent conversations with the Russians. And so, I think it raises real questions about, why they were talking so often? And what was said?

[01:10:00] HOLMES: I want to move on though. We want to talk about Mr. Trump's pick for Labor Secretary, Andrew Puzder. He withdrew on Wednesday, when it looked like he wouldn't get enough votes to go through and be confirmed in that position. I mean, how much of a blow is that? I mean, Republicans were rejecting this candidate. Of course, it follows on from the Vice President having to step in for the Education Secretary, Betsy DeVos, to get her over the line. That's never happened before. What does that say about the Republican Party and their support?

THOMAS: Well, first of all, kudos to Members of Congress that's stepped beyond their partisan meetings, and did the right thing. In this case, the nominee was flawed. I think it more speaks to the fact of the vetting process of some of the nominees that the Trump administration didn't do as thorough of a job as they should have or they would've seen this issues.

HOLMES: What do you think? Because do you think that perhaps it's a sign that there could be growing numbers of Republicans prepared to say no?

JACOBSON: Yes. I think there's - I think there's a growing rift, between House and Senate Republican in the White House. They see chaos. They see dysfunction. They see instability coming out of the White House. I mean, we've had scandal after scandal after scandal. It's unprecedented. I mean, any one of these scandals would've been had the biggest scandal of Obama's entire eight years as President. But every single day there's new news coming out, new controversy, new salacious stories coming out, and I think it underscores this separation that were seeing between Congressional Republicans and the White House. Those in Congress don't want to have anything to do with the on-going scandals at the White House.

HOLMES: John, you know, we've heard a lot of criticism about the President not being tough on Russia at a time when this cruise missile out there that could violate a treaty. And you've got a spy ship off the coast of the U.S., planes buzzing U.S. ships in the Black Sea. Is there a sense that Russia, and Iran, and North Korea in particular, are testing this President and how he responds is going to be key?

THOMAS: You're 100 percent right. It's essentially - all, even our allies are testing the President. And President Trump really has dealt a unique task because the last eight years have been, at least in my perspective, years of weakness, of lack of strength. And so, President Trump is having to retrain these people, that you're not going to get what you want, that you can't test missiles without ramifications and repercussions. You saw him starting to do it with Iran, and he needs to do it with Russia.

HOLMES: Dave, do you think - how far he goes is always the concern. But what do you think he needs to do other than words and tweets?

JACOBSON: Right. Everyone knows Donald Trump was the change candidate in 2016. And he came in at a certain level to bulldoze the establishment, to shake things up both domestically and internationally. That's what his campaign platform was all about. But I think here's the issue, he's fanning the flames of instability. He's creating anxiety, and alienating our allies.

A week ago, he got in an argument with the leader of Australia. He's got into a back-and-forth rift with the leader of Mexico: one of our closest allies. He's putting distance between himself and our NATO allies particularly, Germany. At the same time, he's hugging our adversaries whether it's Russia or others out there. And I think this instability that he's, you know, sending across the world I think really is causing more anxiety. I think it's dangerous for Americans.

HOLMES: You read the media, I was just reading on Politico. And you go into any of the major news websites - the question being asked is, what's up with Donald Trump and Russia? I mean, is that - is that a question that's bothering Republicans as well?

THOMAS: It is a question, but I can see the logic. I think Donald Trump doesn't want to completely write off Russia, and thinks that we may have things in common to fight ISIS, for instance. And that if you just discount them from the get-go, that you're going to write off those opportunities for strengths. I think that's what he's trying to find right now.

HOLMES: Yes. One argument is, Russia's not doing a lot of fighting of ISIS, been a lot of fighting of opponents of al-Assad. One thing that caught my mind, I want to run it by both to you guys, that Donald Trump is going to hold a rally this weekend, in Florida. Like a campaign rally. In fact, it's been paid for by his campaign. Why? He won. Why is he doing that?

THOMAS: I think there's two reasons. It's actually quite brilliant. First reason is to distract the news cycle. So, just politically speaking it shifts the conversation. Secondly, which is more, smart than even the first, is Donald Trump was successful because he took his message directly to the people. He's excellent at that. And that's what he's doing right now. He's keeping in touch with the folks, real Americans, going around us, and taking his message directly to the people. And I applaud him.

[01:14:36] JACOBSON: One thing - two things, pardon me. I think one, we know he's an ego maniac and he need to go out there and stroke his ego and validate himself; number one. And number two, I think he's trying to fend off a 2020 challenger. You've seen this eroding approval number coming in from the White House. Within eight days of his presidency, he had the majority of Americans who disapproves at his job. I think it was 900 days for Barack Obama to hit that level, 1200 days for George W. Bush. I think he's trying to send a message to other potential Republican challengers. Perhaps, someone like Ted Cruz or Marco Rubio, hey, I'm running in 2020. Don't challenge me. I'm starting early. [01:15:07] HOLMES: We had Marco Rubio around for dinner. So, maybe he's trying to soften him up at the White House. Are you concerned though that as -- I mean, we're less than four weeks into this.

THOMAS: You know, it's exhausting.

HOLMES: How's it going?

JACOBSON: Catastrophic failure. I mean, alluding to what I've said earlier, I mean, you've said, scandal after scandal after scandal. People can't trust what comes out of Donald Trump's mouth anymore or his high-ranking officials. Earlier, I think one of the stations, MSNBC refused to have Kellyanne Conway, one of his Chief Strategist, on any of their shows because they don't know what she's say - they don't know what she says if it's truthful or not. And I think, that really undermines the legitimacy of the White House and their credibility.

HOLMES: Well John, you'd probably say that at least it's being productive.

THOMAS: Yes. As you said, certainly growing pains. I'm not going to argue with that but I will tell you, as conservatives, we're getting a lot of what we want. The cabinet appointments from mad dog Mattis to even Betsy DeVos who's a charter school advocate --

HOLMES: Controversial candidate.

THOMAS: Well, to Neil Gorsuch to try to neuter the EPA. I mean, look, these are some really good things that his base are excited about. To supporting Israel, that Christians and Jews alike are deeply about. Yes, it's a little bumpy but by and large and the policy fraud, we're getting what we hope for.

HOLMES: Conservatives are happy. All right, John Thomas and Dave Jacobson, thanks so much.

THOMAS: Thank you, appreciate it.

HOLMES: As always, a good conversation.

SOARES: Now, Donald Trump has never held back his dislike for the media except when the stories are positive. All right, of course, positive. Well on Wednesday, CNN's Jake Tapper seemed to have heard enough.

(BEGIN VIDEO CLIP)

JAKE TAPPER, CNN THE LEAD ANCHOR: The media, of course, did not fire General Flynn, President Trump did. Now, what the media did do was reveal to the nation that General Flynn had lied to the country and to the Trump Team including Vice-president Pence when he claimed to never discuss to Obama's sanctions on Russia with the Russian Ambassador. President Trump knew at least as early as January 26th but he did not act on this until the media revealed the truth to you. And as it turns out, to Vice-president Pence who learned about it through the media, sources say.

(END VIDEO CLIP)

HOLMES: Well, a quick break here on the program. And when we come back, the Pentagon considers a fundamental shift in Syria. Perhaps sending U.S Combat Troops there to fight ISIS.

(COMMERCIAL BREAK)

KATE RILEY, CNN WORLD SPORT ANCHOR: I'm Kate Riley with your CNN WORLD SPORT Headlines. Champion's League Holders Real Madrid overturned in early deficits, takes a 3-1 advantage into their second leg tie in Napoli inspired by former player, Diego Maradona's presence in Madrid. The Italians took the lead in the eighth minute behind Lorenzo Insigne and put a Karim Benzema header level the affair after 19 minutes. And second half goals from Toni Kroos and Casemiro put the other team in the downside and the driver's seat ahead of their March 7th trip to the Sao Paulo.

Now, Bayern Munich have all but regrets to their tie against Arsenal after dominant home display against Arsene Wenger's men. The first half finished, one all. But four second half goals from the German champion concluding two from Tiago make the second half in London nearly an impossible task for the gunners by. Bayern can eliminate arsenal from the Champions League for the third time in the last five years.

And we are just 100 days away from the start of the 35th America's Cup -- the sailing race which dates back to 1851. Four years ago, Oracle Team USA recovered from their insurmountable 8-1 deficit, only to go on and win the remaining eight races and defend their title. This year, Oracle will face the winner of the Louis Vuitton Cup which takes place immediately prior to the competition.

And that's a look at all your Sport Headlines. I'm Kate Riley.

[01:21:12] HOLMES: Welcome back. Malaysian police have arrested a second woman in the death of North Korean Leader Kim Jong-un's half- brother. South Korean officials say, they suspected two women of poisoning Kim Jong-nam. He died after he was attacked at Kula Lumpur's Airport on Monday. Malaysian reports say his autopsy is now complete but the results have not yet gone public. Saima Mohsin joins us now live now from the Malaysian Capital with the latest. And everybody pretty much knew who he was but the identification has now been confirmed we understand. What's the latest?

SAIMA MOHSIN, CNN CORRESPONDENT: Yes, exactly Michael. It's moving at a quite fast pace today after Malaysian police and authorities remain tight lipped. They simply wouldn't talk to us, Wednesday local time. It's now Thursday here and they have just held a press conference. The Deputy Prime Minister said that the North Korean Embassy officials have actually spent the day here at the mortuary at the Central Hospital, Kuala Lumpur, have confirmed the identity as being the half-brother of Kim Jong-un, Kim Jong-nam. Now, he was traveling on that alternative I.D. of Kim Chol. According to Malaysian police, you remember, South and North Korean officials have now said that higher authorities have confirmed his identity.

Alongside of that is, earlier this morning, a second arrest of a second female suspect. Now, you'll remember that's on Wednesday night here. Malaysian police announced that they had arrested a woman at the Kuala Lumpur International Airport. She was traveling alone or alone at that time -- let me correct myself there. We don't know if she was trying to leave the country or traveling at that time. She was at the airport. She was carrying a Vietnamese travel document and she's being named as Doan Thi Huong. And the second female suspect, another woman. Two Asian women, remember Michael, named - not named -- said by South Korean Intelligence officials. Two Asian women were suspected of carrying out this attack. The second woman being an Indonesia passport holder at the time of her arrest. She was alone as well named Siti Aishah, Michael?

HOLMES: Now, let's go back a little bit more to Kim Jong-nam. Tell us what more we know about him, why he was living outside of North Korea and how vocal he was about politics back home.

MOHSIN: Yes. He's been effectively living in exile. His major favorite home place being Macau, that is of course Chinese territory. He was apparently on his way there when he was flying out of Kuala Lumpur International Airport terminal two when that attack took place. He told people that someone had grabbed him by the face. Now, he has been living out of exile because he fell out of favor with his father, Kim Jong-il. He was the heir apparent, the first born as of Kim Jong- il's love affair with his favored mistress. And he was tipped to be the new North Korean leader after Kim Jong-il's passing in 2011. But in 2001, Kim Jong-nam was caught trying to travel to Tokyo, Disneyland on forged paperwork again. And that embarrassed his father hugely. He was then effectively, we believe, having to live in exile. And then when he wasn't at the funeral in 2011, that's when analysts really believed he was out of favor. And that's why Kim Jong-un, the younger brother from another favored mistress of Kim Jong-il.

So, they are half-brothers, destined to take over. They have been huge rivals since then. They have never met because of the North Korean policy of raising heirs separately. But Kim Jong-nam was a huge critic of Kim Jong-un, Michael.

HOMLMES: All right, Saima Mohsin with the latest there in Kuala Lumpur, Isa.

[01:25:15] SOARES: Thanks very much, Michael. Well, the U.S. Defense Department may recommend sending U.S. Ground Troops into Syria. The proposal is one of several options under review as the Pentagon puts together a plan to defeat ISIS. The White House has asked U.S. Defense Secretary James Mattis to present that plan by the end of the month. CNN Muhammad Lila joins us now from Istanbul in Turkey with more. Muhammad, we know that up to now, only small teams, made up of largely Special Operation Forces have operated in Syria, pretty much providing training and assistance to anti-ISIS opposition groups. So, what would a mission in Syria look like?

MUHAMMAD LILA, CNN CORRESPONDENT: Well Isa, this would affect - effectively be a fundamental shift in the U.S. Policy in the region and of course, in the military balance as far as it comes to Syria. The main thing to keep in mind about this proposal is that, you know, it's one of many proposals that's being discussed and it would have to be approved directly by President Trump. But this idea calls for conventional ground troops to be put on the ground and here's why that's important. Special Forces units can act very - in much smaller numbers, they act very autonomously, very independently and they can sort of embed themselves with existing military units on the ground.

The moment we open that up and start talking about conventional soldiers or conventional marines on the ground, we're dealing with much bigger numbers. And of course, there are other questions like, for example, when there are American troops on the ground, you need a wide support network. You need bases, you need sanitation, you need drainage, you need supply chains that can bring in food and equipment and firearms and all of the things that a conventional army needs to operate. So, we're not - we wouldn't be talking about very small numbers, we'd be talking about a very major American footprint that would put American soldiers right on the front lines of the Syrian conflict.

SOARES: The risks of operating there but also how to work with Russia, both on the ground and in the air. Muhammad Lila, thank you very much.

HOLMES: Next here on NEWSROOM L.A. Donald Trump steps back from decades of U.S. Policy while he and the Israeli Prime Minister signal a new chapter in bilateral relations. That and much more when we come back.

(COMMERCIAL BREAK)

[01:30:51] MICHAEL HOLMES, CNN ANCHOR: Welcome back, you're watching CNN NEWSROOM live from Los Angeles. I am Michael Holmes.

ISA SOARES, CNN ANCHOR: And I'm Isa Soares in London. Let me bring you up to date with the main news headlines we're following for you this hour.

A growing number of U.S. senators are demanding more information about ex-National Security adviser Michael Flynn's contacts with Russian officials. The top Republican and Democrat on the Judiciary Committee want a full FBI briefing. Meanwhile, House Republicans want an investigation into the leaks that led to Flynn's resignation.

HOLMES: A car bomb in the Iraqi capital has killed at least five people and wounded 20 more. The attack happened Wednesday in a mostly Shiite neighborhood in eastern Baghdad. No one claiming responsibility.

SOARES: The Venezuelan government has taken CNN Espanol off the air. The telecommunications commission accuse the network of slander and distortion. The opposition controlled National Assembly condemned the move. Days earlier, CNN Espanol aired the report alleging passports were given to people with terrorist ties. The network stands by the story. CNN Espanol is offering its live signal on YouTube for free and news links on CNNEspanol.com. HOLMES: U.S. president Donald Trump stepping away from a two-state

solution as a path to Israeli-Palestinian peace. He's met with the Israeli prime minister Benjamin Netanyahu on Wednesday at the White House. The leaders joked with and praised each other while setting a tone for warming relations.

Elise Labott with more.

(BEGIN VIDEOTAPE)

ELISE LABOTT, CNN FOREIGN AFFAIRS REPORTER: President Trump made a remarkable break in decades of U.S. policy. Backing away from the two-state solution that would give Palestinians their own state.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I'm looking at two- state and one-state. And I like the one that both parties like. I'm very happy with the one that both parties like. I can live with either one.

LABOTT: Still Trump insisted that he was committed to a peace deal.

TRUMP: We'll be working on it very, very diligently. Very important to me, also. Something we want to do. But it is the parties themselves who must directly negotiate such an agreement. We'll be beside them. We'll be working with them.

LABOTT: And he made clear he wasn't giving Netanyahu a blank check.

TRUMP: As with any successful negotiation both sides will have to make compromises. You know that, right?

LABOTT: And with a playful tone warned Netanyahu to stop settlement expansion in the West Bank that has grown exponentially since Trump took office.

TRUMP: As far as settlements I'd like to see you hold back on settlements for a little bit? We'll work something out.

LABOTT: Referring to, quote, "other players" at the peace table, the president wants to enlist Arab states who share Israel's concerns about Iran to help close the deal.

TRUMP: I think we're going to make a deal. It might be a bigger and better deal than people in this room even understand. That's a possibility. So let's see what we do.

BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: It's a start.

TRUMP: It doesn't sound too optimistic but it's a good negotiator.

NETANYAHU: That's the art of the deal.

LABOTT: Netanyahu embraced Trump's tough message to the Palestinians.

TRUMP: I think the Palestinians have to get rid of some of the hate that they're taught from a very young age. They're taught tremendous hate.

LABOTT: And lavished praise on Trump's negotiating skills and courage as well as his son-in-law Jared Kushner, Trump's close adviser who he tapped as his personal peace envoy.

NETANYAHU: Can I reveal, Jared, how long we've known you? Well, he was never small. He was always big. He was always tall. But I've known the president and I've known his family and his team for a long time. And there is no greater supporter of the Jewish people and the Jewish state than President Donald Trump.

LABOTT (on camera): And diplomats and experts say that President Trump may have been showing wavering on the two-state solution to help Israeli Prime Minister Netanyahu who is facing political problems at home.

[01:35:05] And they note the Palestinians do have a vote in all of this and they're unlikely to accept a deal that doesn't lead to with their own independent Palestinian state.

Now President Mahmoud Abbas had a chance to discuss this with CIA Director Mike Pompeo who was in Ramallah on Tuesday night where they discussed among other things the future of the peace process.

Elise Labott, the State Department.

(END VIDEOTAPE)

SOARES: Let's get more on this, Abdel Bari Atwan joins me now. He's the former editor-in-chief for Al-Quds, a Palestinian newspaper based in Jerusalem. A very well-known face here on CNN.

Thank you very much, Abdul, for coming on the show. What did you make we just listened there to President Trump's comments that he can live with either a one-state, two-state? Do you think this is a policy that he's setting in place or do you think it just shows a lack of understanding of the conflict?

ABDEL BARI ATWAN, FORMER EDITOR-IN-CHIEF, AL-QUDS: It is both, lack of understanding and no policy at all. This is the major thing. I believe sidelined the Palestinian issue completely and he left the situation to rot, and this is extremely dangerous. It will play to the hands of the radicals among the Palestinian, among the Arabs, among the Muslims, and it will give a very, very lethal ammunition to radical Islamic State which is now dominating the scene in the Middle East.

It is really dangerous here. You cannot just say, you know, they can -- the Palestinian and the Israelis should sit together and sort things out. No. This is not the American policy. This is not the international community policy. This is not the European policies. So it means he washes his hands completely from the Palestinians.

SOARES: Now you may say that but I was looking at some of the comments that we've heard from President Obama -- the former President Obama. And he said, in his last -- before he left, the last press conference, that perhaps the two-state solution needs to be rethought, needs to be a rethink on that front. So do you think -- I mean, anyone listening to this could perhaps think, you know, this sounds flexible, open minded. But what are the Palestinians saying about this? Are they saying this is dangerous?

BARI ATWAN: Well, extremely dangerous because, you know, there is a lot of international resolutions, U.N. Security Council resolutions, insisting that. The only solution is the two-state solution. So now if we are killing and burying this solution, what is the alternative?

Now, you know, we have two alternatives. One-state solution which means that the Palestinian and Israeli to live together in equal footing or violence on the West Bank and Gaza Strip. So we -- it seems we are heading toward violence. We are heading toward radicalization. We are heading towards a lot of maybe suicide attacks, another intifada --

SOARES: So you're saying this basically increases --

BARI ATWAN: Definitely. Definitely. You know, Hamas, for example, which is a radical Islamic organization, elected a new leadership and this leadership is extremely radical leadership. Again, I heard from Fatah side, the PLO side, they are thinking of actually re-changing the whole of their policies and go back to intifada, to confrontation policies against the Israeli because they cannot live anymore under this stagnation that -- you know, since Trump took over as a president, 6,000 Israeli or settlement -- Jewish settlement is going to be built on the West Bank. So what's left for the Palestinians?

SOARES: Let me -- on the settlement front, listen, he had -- President Trump had advice for the Palestinians. Take a listen to this.

(BEGIN VIDEO CLIP)

TRUMP: I think the Palestinians have to get rid of some of the hate they're taught from a very young age. They're taught tremendous hate. I've seen what they're taught. And you can talk about flexibility there, too, but it starts at a very young age and it starts in the school room. And they have to acknowledge Israel.

(END VIDEO CLIP)

SOARES: So Palestinians must get rid of their hate. How are those comments being interpreted, Abdul?

BARI ATWAN: I'm surprised. You know, he is asking the Palestinians to make concessions, to get rid of their hate, to actually recognize Israel as a Jewish estate. So he's asking the underdogs, he's asking the Palestinians who are under the occupation. The Palestinians are not occupying the Israeli. It is the opposite. The Palestinian are not building settlements on the Israeli land. The Israeli who are doing so. So it is absolutely unfair and this kind of language wouldn't help the peace process in the region. It will help the radicals in the region. I believe President Trump sidelined the Palestinian cause and

concentrating on the Iranian one. And he is adopting not the Israeli policies, the radical Israeli policies.

[01:40:05] Mr. Netanyahu policies, establishing settlements and actually killing the peace process completely. This is very dangerous, not for the Palestinian only but for the whole region.

SOARES: Abdel Bari Atwan, thank you very much. Michael?

HOLMES: Well, the U.S. Defense secretary is warning NATO allies it is time to pay up. James Mattis met for the first time on Wednesday with ministers at NATO headquarters in Brussels, Belgium. He reaffirmed the U.S. commitment to the alliance but cautioned it comes at a price.

Here's CNN's Erin McLaughlin.

(BEGIN VIDEOTAPE)

ERIN MCLAUGHLIN, CNN CORRESPONDENT: Secretary Mattis received a warm welcome here at the NATO headquarters, a place he called his second home. After all he was once the Supreme Allied Commander for Transformation.

Now given that President Trump once called NATO, quote, "obsolete," Secretary Mattis's first move was to reassure allies of the United States' commitment to the alliance.

JAMES MATTIS, DEFENSE SECRETARY: The alliance remains a fundamental bedrock for the United States and for all the transatlantic community, bonded as we are together. As President Trump has stated he has strong support for NATO.

MCLAUGHLIN: But behind closed doors, Secretary Mattis carried a warning for NATO allies, particularly in the area of defense spending saying, quote, "America will meet its responsibilities but if your nations do not want to see America moderate its commitment to this alliance each of your capitals needs to show support for common defense."

Currently only five of the 28 NATO allies spends 2 percent of their GDP on defense, a threshold that was agreed upon back in 2014 and Secretary Mattis saying that this year he wants to see an agreed upon plan put in place which includes milestone dates to mark progress in this area. He pointed to a new political reality in the United States that is impatient.

Erin McLaughlin, CNN, Brussels.

(END VIDEOTAPE)

SOARES: Now North Korean missile tests are generally seen as provocations and the most recent, well, was no different. But Pyongyang says the world has it all wrong. We'll explain after a very short break.

(COMMERCIAL BREAK)

[01:45:21] HOLMES: The North Korean government says the latest missile launch was not meant to provoke their enemies. Instead sources tells CNN the missile was a gift for the late leader Kim Jong- il.

Our Will Ripley has this exclusive report from Pyongyang.

(BEGIN VIDEOTAPE)

WILL RIPLEY, CNN CORRESPONDENT (voice-over): North Korea has no religious holidays but make no mistakes, this is a time of worship. On the 75th birthday week of late leader Kim Jong-il, tens of thousands flock to one of Pyongyang's most sacred sites. They come to honor two men whose legacy towers over every aspect of lift in this highly militarized nation. The man who led North Korea into the nuclear age.

A government source tells CNN it's no coincidence North Korean leader Kim Jong-un chose this week to test the latest weapons in his growing arsenal, a ballistic missile and newly developed mobile launcher. North Korea says it's capable of a nuclear surprise attack on key U.S. allies and military installations. And it seems to play well with the people.

"We're very proud of our military achievements," says this retiree. "Now we have nothing to be afraid of in the world."

These men have lived under three decades of the Kim family leadership. All their lives the government has warned them they're under the constant threat of invasion by what they called the hostile United States. They've seen North Korea's arsenal grow, along with its alienation from the outside world.

(On camera): Do you worry that these tests are isolating your country and leading to more economic hardship?

(Voice-over): "We always lived under sanctions," he says. "We were under sanctions yesterday and today. We're not worried."

(On camera): The North Korean weapons program began under the late leaders Kim Il-sung and Kim Jong-il. But it has really accelerated under the current leader Kim Jong-un. Just in the last year along he has ordered two nuclear tests and launched more than 20 missiles. And he is promising more to come.

(Voice-over): Everyone we meet on the streets of Pyongyang offers only praise for their leader's military first policies.

"As long as we have our great Marshall Kim Jong-un and we believe in him, we're not afraid of anyone," says this city employee.

We are allowed to approach anyone we want. All give the same answer. In this close society, nearly all information comes from state- controlled media. JOSEPH BERMUDEZ, 38 NORTH SENIOR ANALYST: This is the reason why

you're sacrificing. This is why you don't have the highest quality of food. You have to work extra hours.

RIPLEY: Joseph Bermudez, senior analyst with 38 North, says missile launches and nuclear tests allow the young leader to project power and ensure survival.

BERMUDEZ: North Korea is in this for the long term.

RIPLEY: He says Kim's ultimate goal, to make it simply too dangerous for any foreign country to threaten his nation's existence.

Will Ripley, CNN, Pyongyang, North Korea.

(END VIDEOTAPE)

SOARES: You are watching NEWSROOM L.A. Still to come --

(BEGIN VIDEO CLIP)

KYLE SNYDER, TEAM USA WRESTLING: Every Iranian that I've ever come in contact with have always been extremely respectful, extremely polite.

(END VIDEO CLIP)

SOARES: U.S. wrestlers are ready to rumble in Iran after the country initially put them in that half nelson over Mr. Trump's travel ban. We'll have more after the break.

(COMMERCIAL BREAK)

(WEATHER REPORT)

SOARES: Now U.S. wrestlers got a warm welcome in Iran despite differences between two nations over Donald Trump's travel ban. Now Team USA feels at home in wrestling mad Iran.

Here's our senior international correspondent Frederik Pleitgen.

(BEGIN VIDEOTAPE)

FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice- over): A tough sporting mission with a twist of diplomacy. America`s national wrestling team is in Kermanshah, Iran, for the World Cup. A trip that almost fell through because of tensions between the U.S. and Iran.

Olympic gold medalist Jordan Burroughs saying the team is just happy to be here.

JORDAN BURROUGHS, TEAM USA WRESTLING: It was difficult being pawns in the game of, you know, political powers that really essentially were deciding our fate. So a little difficult for a period of time, but we stayed the course. We continued to train, continued to prepare. And luckily, we were able to come. PLEITGEN (on camera): Iran originally refused to grant Team USA visas

in retaliation for the Trump administration's travel ban that also targeted Iran. But after U.S. courts blocked the ban, the visas came through.

(On camera): Of course, there was a lot of uncertainty for the Team USA wrestlers, not knowing for a very long time whether they`d be able to come here to Iran at all. But now that they`ve made it, they say their main focus is to compete hard and win big.

(Voice-over): Iran and America are wrestling powerhouses. Many U.S. wrestler stars in Iran like Olympic gold medalist Kyle Snyder.

SNYDER: Every Iranian that I've ever come in contact with have always been extremely respectful, extremely polite. So, like you said, there's a little bit of turmoil politically, but definitely you don't see that within the sport. You know, we respect each other as competitors and as people.

PLEITGEN: Team USA received a raging welcome when they arrived here both from Iranian officials and fans of the sport, Team USA's coach says.

BILL ZADICK, HEAD COACH, TEAM USA: This is my fourth time to Iran. We`ve been treated extremely well, as we have in the past and as we tried to reciprocate when they come to the United States.

[01:55:02] PLEITGEN: While political tensions between the U.S. and Iran have been escalating since President Trump assumed office, the head of Iran's wrestling federation tells me politics have no place in the sporting rivalry.

"We are two very powerful international wrestling teams," he says. "And along with others, we're trying to help the sport internationally to promote wrestling throughout the world."

Iran and the USA are clashing once again on the wrestling mat and now that the diplomatic hurdles have been cleared, the athletes say their only focus is trying to win it all.

Fred Pleitgen, CNN, Kermanshah, Iran.

(END VIDEOTAPE)

HOLMES: Well, you probably may be have only seen a camel in the desert plotting along through the sand. Well, check out these lucky few. They get to play in the snow.

Now this is eastern Turkey. And you can tell that the camels are having a pretty good time, actually. It's hard not to smile as you watch them having a little frolic. Camels in the snow, that will brighten your day. What do you think, Isa?

SOARES: I don't know they could survive in the show. But they've got thick layers, don't they? And those ones definitely look like they have the hump. HOLMES: Oh, nice one. I was trying to think of something and you

beat me to it. You're smarter than me as you've always been. They're yelling at us, we got to go.

You're watching CNN NEWSROOM. I'm Michael Holmes in Los Angeles.

SOARES: And I'm Isa Soares in London. We'll both be back in a few minutes. Do stay right here with CNN. We are, of course, the world's news leader.

(COMMERCIAL BREAK)