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WORLD RIGHT NOW WITH HALA GORANI

Trump Focuses on Economy Amid Tense Social Climate; U.S. and North Korea Calm Divisive Rhetoric; White Supremacist Groups Stir Social Unrest; Damore: I Don't Support Alt-Right; U.S. President Speaks at Trump Tower. Aired 3-4p ET

Aired August 15, 2017 - 15:00   ET

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


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[15:00:28]

(HEADLINES)

PAULA NEWTON, CNN ANCHOR: Hello. I'm Paula Newton sitting for Hala Gorani. This is THE WORLD RIGHT NOW.

Hello and welcome. When Britain shocked the world and voted for Brexit, the message was in fact loud and clear, we want change. But when it leaves

the European Union in March 2019, some things may look in fact exactly the same, at least for a little while.

The government has laid out its plans for customs arrangements, which would include keeping existing rules for about two years. Isa Soares has more.

(BEGIN VIDEOTAPE)

ISA SOARES, CNN INTERNATIONAL CORRESPONDENT (voice-over): The clock is ticking on Brexit and the U.K. is wasting no time in laying out its roadmap

about what it wants on trade. Calling for temporary customs union with the E.U. that will facilitate the freest and most frictionless possible trading

goods between both.

It's a proposal some argue proves the U.K. only wants to have its cake and eat it, an accusation Brexit Secretary David Davis contests.

DAVID DAVIS, BRITISH BREXIT SECRETARY: It is actually in their interest too. I mean, we sell 230 billion euros of goods to them, which (inaudible)

to them every year. They sell 290 billion to us.

If you are a BMW or Siemens or Bavaria, if you are a company in Holland or indeed you are the port of Rotterdam, you want this to work. You want a

smooth frictionless trading arrangement so you can sell into one of the biggest and fastest growing markets in Europe.

SOARES: The E.U. Customs Union allows goods to move freely between member states and that means that between the 27 countries, there are a few checks

and no tariffs or taxes are imposed on each other's goods.

So, staying in for the U.K. even if it's just for an interim period of two years as it's being proposed means businesses can avoid higher cost of

goods and less disruption.

After that, though, in post-2019, the U.K. would want a highly streamlined border with the E.U. which begs the question --

(on camera): Why not stay in the custom union as it is rather than (inaudible).

DAVIS: Because that takes away our right to do deals with the rest of the world, which is the big upside for the United Kingdom in this.

(END VIDEOTAPE)

SOARES: The proposal is already raising eyebrows in the continent with some saying it is (inaudible) to see, but the European Commission is being

somewhat more measured calling it a positive step.

But reminding it of its continuing position on the matter basically saying that frictionless trade is not possible outside of the Customs Union and

outside of the single market, which should be interesting talks when both sides meet in two weeks' time. Isa Soares, CNN, London.

NEWTON: OK. Interesting talks. Well, a trade arrangement is in fact just one of the important issues that need to get sorted out ahead of Brexit.

We want to go straight to London and speak to Quintin Peel. He is an associate fellow at Chatham House.

Quintin Peel, E.U. officials have been telling you for many months that this is going to be much longer and much harder than Britain anticipates.

In this new proposal, do you see that Britain is actually getting that message?

QUINTIN PEEL, ASSOCIATE FELLOW, CHATHAM HOUSE: I'm not sure that they are actually. I think that the main points of this proposal is to try and

reconcile the two sides in a very deeply divided British government.

One side that actually wants a heart Brexit that we just come out of it all out of the European Union, and the other side that is very worried that

that will actually be a nightmare for British business, British financial services, and we do not have a transition.

Now the softies, if you like, seemed to have won the argument that there must be a transition, but in order to keep the hard Brexiters on board,

they've conceded that actually we are not going to stay either in the single market or in the E.U. Customs Union in the transition. We got to

invent a completely new one.

[15:05:03] NEWTON: And at the end of the day, if I am a negotiator sitting across from Britain at the table, I see vulnerability and not to make too

fine of a point of it, but there are people like Scotland's first minister, Nicola Sturgeon, you know, she feels it leaves everyone vulnerable.

She had a strong reaction on Twitter saying "It seems the U.K. government is back to it to its daft, have cake and eat it approach to Brexit. They

should commit to staying in a single market and Customs Union."

You know, we know what she thinks and she is at that stirring the pot. She is very daft at that. Having said that, though, the E.U. itself and

(inaudible), the European Parliament's chief Brexit negotiator was very pointed on Twitter, "To be in and out of the Customs Union and invisible

borders is a fantasy. First need to secure citizens' rights and a financial settlement."

And there it is, Mr. Peel, how much this divorce will ultimately cost Britain. In terms of Britain coming to terms with this and what we all

hear is a divided cabinet. What is the best way forward for them do you think?

PEEL: Well, I think they are between a rock and a hard place. Their problem is this, actually, I think the negative reaction to this, the most

important negative reaction, has come from big business.

They are really worried that they will face not less red tape, but more red tape, and they hear somebody like David Davis, who you had on just now,

calling his strategy constructive ambiguity.

Now businesses can't have ambiguity, they need clarity, and they are saying, give us a clear way forward and then we may be able to take action.

If you do not, we will probably move, will probably move factories and so on and to Britain, and over to the continent.

NEWTON: Yes. And what's interesting about that is that businesses cannot price that, right? They don't know what to price into that equation and

that they get cold feet.

I have to ask you, though, if we pull back from these financial arrangements and we get back to the sentiment that is Brexit. The fact is,

Britain voted to leave the E.U. and that sentiment according to recent polls is still alive and well.

Are those people -- and it is the will of the people, is it being well- served as these negotiations go forward?

PEEL: The really hard-line Brexiters, people like Nigel Farage, who led the UKIP Party, very, very determined to leave the European Union at all

costs. They actually think that the government is making a complete mess of the negotiations because they are divided.

The trouble is nobody has actually put, if you like, a sensible negotiating plan on the table. The Labour opposition is also ambiguous. So, everybody

feels a huge amount of uncertainty.

I think this was inevitable from the moment that that referendum went in the direction of leaving the European Union. I still believe that there

may be a possibility that at the end of the day, the Brits are getting to say, look, this is a nightmare, we have got to find some way of getting out

of it.

NEWTON: Gosh. Mr. Peel, we can't even go there. The whole show wouldn't be long enough to go there. We will continue to follow these negotiations

with interest again. Brexit is a reality in Britain and they are trying to find a way to deal with it. Thanks so much for your time.

Now one, two, three, now four, American business leaders have walked away from U.S. President Donald Trump's Manufacturing Council, and you know,

that isn't even the talk about all the reaction from other CEOs on Twitter.

And this is over his initial response to deadly violence at a neo-Nazi and white nationalist rally in Virginia on Saturday. Scott Paul who leads the

"Alliance for American Manufacturing" joined the CEOs of Merck, Under Armour, and Intel in resigning from the council.

The exit is a clear sign that the president's rejection of hate groups was in fact too little and too late.

And this just in, we are hearing from another member of the president's council, Walmart CEO Doug McMillan says Mr. Trump, quote, "Missed critical

opportunity to bring our country together by unequivocally rejecting the appalling actions of white supremacists."

We want to talk more about the president's response to the events in Charlottesville. I'm joined now by Alex Conant, a former communications

director for Marco Rubio's presidential campaign, and CNN political commentator, David Swerdlick at the "Washington Post."

David, first to you, this has been a continuing conversation, even you and I have been having on CNN for the last couple of days. Where does he go

from here because it is clear where business stands on the issue?

They feel that they have been pushed too hard at this and yet Donald Trump even his reactions in the last few hours does not seemed to be backing

down.

DAVID SWERDLICK, CNN POLITICAL COMMENTATOR: He doesn't seem to be backing down, Paula, but this is a week where clearly President Trump has had a

hard time getting his hands around his own narrative.

[15:10:03] He is standing apart from members of his own party, members of - - Republican members of Congress, who did not have any trouble giving a full-throated denunciation of the white supremacist actors in the events on

Saturday in Charlottesville.

He has had all of these CEOs as you just described walk away from his council because you know for them it appears to be too either much of --

too much of a business risk or too much of a risk to their own personal credibility to have that close of an affiliation with President Trump after

the events of the last few days.

And President Trump himself is receiving criticism from us in the media and from people in the public because he does not seem to be able to address

this Charlottesville situation, the tragic events, the deaths, the racism in a way that is sincere and concise and clear and demonstrates leadership.

He has lost control of the story.

NEWTON: And Alex, do you get the sense that other Republicans now are getting that feeling. I mean, the CEOs and other business people have been

loud and clear, will Republicans be loud and clear as well?

ALEX CONANT, FORMER COMMUNICATIONS DIRECTOR, RUBIO CAMPAIGN: Many of them already have been. In fact, on Saturday when we saw the president's first

statement that seemed to draw some sort of moral equivalence between the two sides in Charlottesville.

You saw Republican senators like my former boss, Marco Rubio, Cory Gardner, who is the head of the National Republican Senate Campaign Committee

speaking out very forcefully saying that the president needed to say and do more.

And you will continue to see Republicans speak out. Look, there is no room for hate, for racism, for white supremacy in the Republican Party, and

every Republican elected leader will tell you that.

When Congress comes back to D.C. in September, I don't think you'll find a single member of the Republicans in Congress who have any tolerance for

racism, and they expect the leader of our party, Donald Trump, to be equally forceful in denouncing that sort of hate.

NEWTON: But I have a question for you, Alex, I just want to stay with you for a second. I want to go through what the president said in a tweet.

Here is exactly what he said to those executives we are talking about, "For every CEO that drops out of the manufacturing council, I have many to take

their place. Grand standards should not have gone on jobs!"

Alex, the point has to be made one of the reasons that Trump supporters like him is they believe he says in public on Twitter exactly what he

thinks and feels and is two-faced about it, doesn't say one thing in the oval office and another thing in his speeches.

Do you think though that this will actually hurt him because we have been here before? Right, Alex? The sounds and feels very familiar.

CONANT: Yes. I mean, this is deja vu all over again. We went through this on the campaign trail last year. By the way, you did see Republicans

denounce him and you did see it hurt him in the polls.

Obviously, he surged at the end of that campaign for variety of reasons and won a narrow victory, but now he has been in office for over six months.

And you can tell that patience is wearing thin.

Both within the Republican Party you see more members willing to denounce him over things like this weekend statement, but also his falling poll

numbers. Gallup, which is probably the most well-respected polling organization in the United States has amount of record low numbers at only

about 34 percent of Americans approve of the job he is doing.

And those polls -- that poll by the way was taken largely before the events of this weekend. So, it is affecting his political capital, which in turn

will affect his agenda, which in turn will affect the amount of support he is receiving from Republicans.

SWERDLICK: Paula, can I just say --

NEWTON: Go for it, yes.

SWERDLICK: I was just going to say briefly, I think Alex and I are mostly on the same page here about both the politics of the moment and the fact

that these various well-known Republican members of Congress have given these very strong, very clear statements in contrast to President Trump.

Stating that they were denouncing white supremacy, white nationalism, and that they looked at that as the central driving force behind the tragic

events in Charlottesville.

I will only just say that we maybe diverge slightly in the idea that even though the Republican Party is trying to distance in themselves from this,

most of those members of Congress that he cited are people who endorsed President Trump in his run for the presidency.

Even though his run for the presidency played on a very strong us versus them, a very strong xenophobic theme throughout the campaign. Ultimately,

most of these Republicans fell in line behind the president.

NEWTON: Alex, how about that though? If you can speak to that a little bit, you know the criticism that Republicans and it is their fault. They

are even laying blame at Speaker Paul Ryan and saying, had you spoken out about more forcefully about his misogynistic tendencies in his comments or

things like this, we would not be here today. Not that he wouldn't necessarily be president, but that perhaps his behavior might be a little

different.

[15:15:05] CONANT: I don't think there is any evidence of that. I mean, clearly, Paul Ryan is a good example, the speaker of the House, who after

the "Access Hollywood" tape, which I'm sure everyone remembers last October came out, Paul Ryan said he was done with Trump.

That he wasn't going to do anything to help try to get Donald Trump elected president, and most Republican candidates last year while, yes, they did

endorse them in a contest against Hillary Clinton, they also had maintained deep reservations about much of what Donald Trump said on the campaign

trail.

And they were in fact were quick to criticize him when he did make statements that could be interpreted as racist or things like the "Access

Hollywood" tape came out. So, yes, look --

SWERDLICK: Deep reservations but they endorsed him and supported him, just to --

CONANT: In a contest against Hillary Clinton, but they did it with reservations for the most part and now I think we are in a new stage, which

is, look, he is not running for public office right now.

He is the president of the United States and you do see Republican members of Congress speaking out against his leadership increasingly. Just a

couple of weeks ago, you had Jeff Flake, a senator from Arizona, who is up for reelection next year write a long book calling out Donald Trump.

And sort of this populist wave that were seeing in the country right now that Trump took advantage of, to hijacked Republican Party, and then win

the White House.

NEWTON: Alex, I'll leave it there with. Quick last word to you, David.

SWERDLICK: No, I think Alex makes a good point, particularly about Senator Flake, but Senator Flake was one of the senators who did not support

President Trump. If you could go back to Speak Ryan, Speaker Ryan at one point in the campaign called the president out for -- he used the word

racist comments about federal Judge Gonzalo Curiel.

He later still went on to support him, endorse him, et cetera. I understand that the bounds Alex is striking there, but I do think

Republicans still have some discussion to do about how they arrived at this point.

NEWTON: OK. David and Alex, we will leave it there except for one last thing because I do need to get the last word in here. Alex, we have been

trying to get your former boss, Marco Rubio, on here talk about this and many things so please tell him we are waiting for him --

CONANT: I'll put (inaudible). I mean, he's obviously very focused on international events, especially in Venezuela and Cuba.

NEWTON: Well, funny you should mention, I just returned from Venezuela, have a lot of choice questions for him. Please let us know. David, Alex,

thanks so much. Appreciate it.

We will hear from the U.S. president again today. He is scheduled to deliver remarks on improving American infrastructure, yes, remember that,

that infrastructure plan? CNN will bring those to you live as soon as they get underway.

Now, one of the most powerful and disturbing photographs from Saturday's violent events in Charlottetown shows the car barreling into a crowd of

counter-protesters. You see a man named Marcus Martin, flying through the air, very disturbing pictures.

He survived the attack with a broken leg and saved the life of his fiancee, Marissa Blair. Now tragically, Blair's friend and co-worker, Heather

Heyer, was killed in that crash.

Martin and Blair spoke to CNN about the horror that they experienced.

(BEGIN VIDEO CLIP)

MARCUS MARTIN, SAVED HIS FIANCEE'S LIFE: Going down (inaudible) walking up the street and the car was just sitting there, just there and out of

nowhere, I am looking down at my phone, and then you hear the tire screech and then I look up and then bodies were slammed.

And I just thought for one split second, I didn't think about myself, I thought about my fiancee, I had to protect her and that's why I'm here for

her protection, and I put (inaudible).

That was a big chance for me getting hit, but I'll do it all over again just make sure that everything is OK with her.

(END VIDEO CLIP)

NEWTON: Yes, a very poignant interview there and two very strong young people who continue to speak out to make sure that their friend, Heather

Heyer, is remembered and all that she stood for.

Now coming up next here, we will have more on South Korea and it is flexing its own muscle. That is coming up.

(COMMERCIAL BREAK)

[15:21:16]

NEWTON: Now we want to go to the threat from North Korea and a renewed push for peace by China and Russia. Now their foreign ministers are urging

the U.S. and North Korea to put the brakes on their provocative rhetoric.

Kim Jong-un has reportedly, though, finished reviewing his military plan to fire four missiles off Guam, but the North Korean leader says he is holding

his fire to see what U.S. President Donald Trump is going to do next.

North Korean state media say Mr. Kim will, quote, "watch a little more than the foolish and stupid conduct of the Yankees." That is a quote before he

decides whether to launch that strike.

Now meantime, South Korea's president says his nation will prevent war by any means necessary. Anna Coren joins me now live from Seoul. Anna, you

have been following this today. He was really quite forceful in making his views known about any kind of military intervention.

ANNA COREN, CNN INTERNATIONAL CORRESPONDENT: Yes. That's right, Paula. It was a rebuke to Donald Trump's threats that we have heard over the past

week about potential military conflict here on the Korean Peninsula.

Basically, President Moon Jae-in saying that they will be no military conflict, no war on the peninsula without his consent. It was Liberation

Day in South Korea and well, actually across the whole Korean Peninsula, which marked the 72nd anniversary of the end of Japanese occupation here.

And he addressed the nation saying that they will be no war on the peninsula and everything must be done to avoid it. It obviously is a very

sensitive issue here. It is the country that's been living with threats from the North for many, many decades.

But obviously after what has transpired over the past week, tensions have certainly increased. Obviously, we heard from North Korea, from the KCNA,

through the state-based media, and those remarks from Kim Jon-un saying that those plans to strike Guam perhaps on hold for now as he waits to see

what the "foolish and stupid Yankees do," quote/unquote.

So, it's time, I guess, Paula, you could say of tensions easing here on the Korean Peninsula in the hope that those military exercises, which are due

next week do not been start off a whole new wave of rhetoric and more threats that could potentially lead to conflict.

NEWTON: Yes. The language becomes more and more shocking and unpredictable, but let's hope that military action becomes exceedingly

predictable over the next few months. Appreciate it, Anna.

Now residents of Guam, as we were just talking about might be taking a deep breath for now, after North Korean leader, Kim Jong-Un, reportedly said

that he really won't strike now at least not for a few days.

That is just a little bit after threatening the tiny island. So, the war of words remains just that, but if it does come to conflict, islanders on

the U.S. territory could be sent to fight by a president they do not even have the right to vote for. CNN's Ivan Watson reports.

(BEGIN VIDEOTAPE)

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): Kickoff on game day in Guam. Teenagers from the Guam Giants and the Southern

Cowboys go head to head. Cheered on by pint-sized cheerleaders. From the sidelines --

Patrick Flores and his son, Patrick Jesus Flores, root for their family's team. The two men share more than their support for youth football.

(on camera): Father and son, you are both serving in the military.

SGT PATRICK JESUS FLORES, U.S. NATIONAL GUARD: Yes. Absolutely. Because my dad, I just want to be like him, follow his footsteps and serve to

protect my family, to protect my island, and serve my country.

[15:25:07] WATSON (voice-over): In 2013, both father and son shipped out to Afghanistan for a year with their National Guard battalion.

(on camera): That must have been tough for the family, right?

FLORES: It's really tough.

WATSON (voice-over): In fact at least eight members of the Flores clan all joined in that deployment. Sergeant Flores says military service is part

of the culture on Guam.

FLORES: Patriotic, religious and patriotic island.

WATSON: The U.S. military says Guam with its population of more than 160,000 people, boasts the most personnel in the military per capita in the

U.S. In addition to high enlistment rates, the military maintains a permanent presence here controlling a third of the island's territory

including an airbase and a naval base with a small fleet of submarines. And yet, Guam is also an island paradise that attracts hordes of tourists.

GEORGE CHARFAUROS, GUAM HOMELAND SECURITY ADVISER: We sell paradise. We sell strategic location. There is a delicate balance (inaudible). We need

to maintain that balance.

WATSON: But on this island where military service place such a pivotal role, native members of the military have one key complaint, since Guam is

a U.S. territory and not a U.S. state, residents do not have the right to vote for the U.S. president, and Guam has no say in the passage of U.S.

laws.

FLORES: Casualties has had happened in every campaign and up to this day we are still hoping for the right to vote.

WATSON: In defense of their country, many people of Guam have made the ultimate sacrifice.

(on camera): Hospital Corpsman Anthony Carbullido (ph) was killed in Afghanistan in 2008. He is one of dozens of servicemen and women from Guam

who have died fighting in the U.S. war on terror.

(voice-over): These Americans can fight and die to defend the U.S., but they do not have the right to vote for the president who may send them into

battle. Ivan Watson, CNN, Guam.

(END VIDEOTAPE)

NEWTON: Stay with us as Donald Trump tries to change the subject, can he refocus on his economic agenda with so much social tension brewing?

(COMMERCIAL BREAK)

NEWTON: The European Union says it will Britain's plans for a Customs arrangement after Brexit. The U.K. government has suggested temporary

Customs Union between itself and the E.U. that continued free trade for about two years after it leaves the union. But Britain wants to be able at

the same time to negotiate trade deals with other countries.

Walmart CEO, Doug McMillon, says President Trump, quote, missed a critical opportunity to bring our country together by unequivocally rejecting the

appalling actions of White supremacists. It's still not clear whether McMillon will stay on Mr. Trump's economic council, but four of his fellow

business leaders have walked away because of the President's response to Charlottesville. Now the disaster unfolding in Sierra Leone is expected

unfortunately to get worse.

Now, the disaster unfolding in Sierra Leone is expected, unfortunately, to get worse. The Red Cross spokesperson says 245 people are confirmed dead

now, and he expects that number to rise. Heavy rains triggered a massive mudslide outside Freetown and hundreds of people are still reported

missing.

President Trump seems to be on a mission to change the subject. We expect him to take the mic very soon. Yesterday, he remained largely focused on

the economy. Today, it will be infrastructure improvement. Problem is, the U.S. seems interested in one thing: Charlottesville.

White nationalist rallies and ensuing violence have thrown America's simmering racial tension to the forefront. CNN White House Reporter

Stephen Collinson is covering this very closely.

And, you know, people would say, with good reason, that the spotlight remains on Charlottesville. I mean, you have written and I think, in terms

of reading yesterday -- writing yesterday, that remains the same. This is a man who never wants to say that he is wrong.

STEPHEN COLLINSON, CNN WHITE HOUSE REPORTER: That's correct. What was very interesting about Donald Trump's statement on Charlottesville Monday,

though, was it was one of the first times we've seen a tangible political effect to what might be called a misstep by the President.

There was this conceit about Donald Trump ever since he was running for election that the normal rules don't apply to him, that apply to other

politicians don't apply for him. When he makes a blunder, he appears to get away with it.

But I think what we're seeing -- both in the public reaction to his initial statement on Charlottesville where he didn't call out White supremacists

and as you just talked about, the growing number of CEOs for now that have left various White House advisory councils over this -- is that Donald

Trump is paying a tangible political price for one of his own blunders.

And that's something new, Paula, which hadn't seen so far during his presidency.

NEWTON: Do you think he believes that, though? I mean, at the end of the day, and we have seen this before, it doesn't affect him. He seems to the

Teflon Man and that's how he surprised everyone and won the election.

COLLINSON: I think he doesn't necessarily believe he made a misstep, but it was interesting that he thought he had to come out on Monday amid sort

of intense political pressure and to change his position. He appears to have made that judgment at least.

The thing with Donald Trump is, though, he can have these set piece events, like the speech on Monday, like this infrastructure event you were talking

about, but he doesn't stay on the message his White House aides want him to stay on.

As soon as that speech was over yesterday, he started tweeting that the media, hammering him for not saying exactly what they want him to say on

race. He's gone off to these CEOs very strongly for leaving his advisory council, saying that they're grandstanding.

So a lot of what he does instinctively on Twitter detracts from the more set piece elements of his presidency. So whether he believes it or not, I

think it's clear that it's starting to do him some political damage.

Whether the political ground is shifting significantly under the feet of his administration, though, I think we're going to have to wait until

Congress comes back and to see whether the president still has the authority of the White House to wield as he tries to enact his agenda.

NEWTON: Yes. And thanks for that. Let me remind everyone that fairly shortly, within about a half an hour, we do expect to hear again from the

President on that infrastructure announcement.

That is live pictures you're looking at now at Trump Tower. Yes, he is only a few blocks from us right here in New York and says that he will have

an announcement about that all-important infrastructure program.

Stephen, thanks again. And right now, though, we do want to return to one of the key things on President Trump's agenda now, this threat from North

Korea. We want to take a closer look at the efforts to resolve the standoff by using diplomacy.

Now, former Australian Prime Minister Kevin Rudd joins me now from here in New York where he's the president of the Asia Society.

I want to get one thing clear from, though, and understand where you fall on this. Things have quieted down. President Trump, he hasn't taken

credit for it yet, but I'm sure that he would say that, look, we were tough, we were strong, and that is why it seems that North Korea is backing

down. What do you think?

KEVIN RUDD, FORMER PRIME MINISTER OF AUSTRALIA: Well, anyone who predicts the mind of the North Korean leadership between one day and the next,

frankly, I think, has got rocks in their head, because nobody can. This is not an entirely rational international actor.

[15:35:03] But the two things have changed in the last few days. One's really significant, and that's this very clear statement from the President

of South Korea, President Moon, saying that there can and should be no attack by the United States against the North without the prior approval of

South Korea.

Now, he hasn't said that up until now. This is a big warning shot across the bows of the administration and particularly for the South Koreans to

make that public. And then semi-simultaneously, you have Kim Jong-un, the Supreme Leader in North Korea, saying, well, we'll think about the Guam

option for little while longer yet.

So these are two dynamics. I think, if we read into Kim Jong-un's view, however, to some extent, the analysts would say it's because the language

hasn't continued to escalate. It does result in a net de-escalation compared with where we were three or four days ago.

NEWTON: You know, in the interest of, you know, that great cliche, never waste a good crisis, what can happen here? And I know you have been

looking at this from many different angles for many years and many different positions. What are the dynamics that can change here to

actually get to a resolution?

RUDD: Well, once you start to get towards the brink -- and I read something just a few days ago describing it is sleepwalking to crisis,

sleepwalking the war -- hopefully, it creates a dynamic in capitals which says, for God's sake, we don't want to land ourselves in this mire. How do

we, therefore, think about this creatively and afresh?

Look, the fundamentals of the North Korean problem remain as they have been for the last decade. But the new diplomatic opportunity, I still believe,

lies in this: for United States to be sufficiently persuasive of Beijing to cause the Chinese to conclude that if the Chinese don't help the American

solve this problem, then the Americans may well act unilaterally despite what the South Koreans say.

Secondly, to then to have a conversation with China about how does a fix on the nuclear problem deal with China's underlying strategic concerns about

not agreeing to an American strategy, which creates, ineffectively, a pro- American state on China's borders. And there are elements to that, which are fairly clearly known.

If you get agreement and very close diplomacy between Beijing and Washington on that, the magic lies in a joint diplomatic initiative to

Beijing. That's where, I think, the work should be going.

NEWTON: Let's take this further down the road. And I don't have to remind you of the grand bargain that Pakistan made, and I think that they are

quite happy with the way things turned out in terms of their nuclear arsenal.

North Korea is staring us in the face right now. What is it going to take in order to make them back down, and what leverage does China have?

Because you obviously pointed out that China does not want a united Korea and does not want a friendly, you know, friendly counterpoint, strategic

counterpoint, to the U.S. military presence in Asia there.

RUDD: Well, if you look at those questions in sequence, one, the big difference between North Korea and Pakistan is the Pakistanis have never

sought to develop an ICBM. The North Koreans have. Pakistan's nuclear program relates to India. This one relates across the Pacific, to the

United States and, frankly, to other U.S. allies in the region. It's on a scale beyond the Pakistan problem.

But secondly --

NEWTON: For their national interests, Pakistan would tell you, it's worked. Why isn't Kim Jong-un saying the same thing to himself --

RUDD: Yes.

NEWTON: -- this has worked spectacularly well for him?

RUDD: Yes, I was going to go to this question of Kim Jong-un's intrinsic national interests, which is regime survival. That's not a lot of -- I was

about to say, rocket science in that.

This regime wants to survive. We would regard it as a brutal authoritarian dictatorship. They, however, believe that, after 70 years or so running

the country, that they've got a right to do continue into the long-term future.

So if that's the interest and his conclusion is, the only way to guarantee it is to have your own independent nuclear deterrent against Washington,

the creative diplomacy lies in what other security guarantees are credible to North Korea, which would provide him with regime stability for the long

term?

And that's where you get into this discussion about a three-way security guarantee by the Chinese, by the United States, and possibly by the

Russians guaranteeing, through international agreement, the future security of North Korea and its regime as part of a broader package, including the

denuclearization of the north.

NEWTON: Which many would argue would still mean that Kim Jong-un did, in fact, gained a lot from his grand bargain here. Before I let you go, and

very quickly, you have warned the Trump administration not to underestimate Xi Jinping. Why do you say that?

[15:39:52] RUDD: Well, Xi Jinping is also in election year. Xi Jinping faces a not independent Congress and all the internal party meetings to

determine the future shape of the leadership of China over the next five years are basically underway right now, either at Beidaihe on the beach or

in Beijing itself.

Therefore, there are no ready advantages to be had for Xi Jinping by appearing to be soft on the North Korean question right now. We,

therefore, need to be working against Chinese domestic political timetable on the one hand, which reaches its conclusion on October, November.

But, secondly, as I said, the key objective here must be, this combined diplomacy between China and the US, where you've got a grand strategic

bargain, which deals with those China's long-term strategic interests and America's, as well as those of the South and the North.

NEWTON: Prime Minister Rudd, always a pleasure to speak to you about this and other issues, and we appreciate your time.

RUDD: Thank you.

NEWTON: Now, this is THE WORLD RIGHT NOW. Controversial scenes of hate- fueled protests. What do these groups actually want? A conversation about hate in America, next.

(COMMERCIAL BREAK)

NEWTON: Now, you may not even want to acknowledge that they exist, but hate groups are in the headlines and we're going to take a closer look.

It's hard to overstate how offensive images like this are, the Confederate flag, Ku Klux Klan white hoods, are to most people.

(BEGIN VIDEO CLIP)

CROWD: Red and white. Red and white. Red and White. Red and White.

(END VIDEO CLIP)

NEWTON: Remember those torches, those scenes? Very chilling.

When groups of White man adopt those symbols, fire up torches, and take to the streets in American cities, it goes way beyond raising tensions.

Scenes like these reopen deep social wounds in many Americans' eyes. And we can't stress it enough, it instills fear in people.

Most of us would like to believe that blind hatred motivated by race and religion, well, it's a thing of the past. It's not.

The Southern Poverty Law Center says that the total number of hate groups has risen 13 of the last 16 years, and recently seen an uptick after a very

brief decline. And we want to get more clarity on what these groups want.

Photojournalist Pat Jarrett has some very interesting insight after covering these groups. He was at the weekend rally were a counter

protester died when a man drove a car into a crowd.

And I want to point out, you've been following this for several months. This is not just that you showed up at this rally. I mean, tell us, what

do you see that perhaps many Americans and many people around the world have been missing?

PAT JARRETT, PHOTOGRAPHER AND EDITOR, VIRGINIA FOUNDATION FOR THE HUMANITIES: I've seen this movement is alive and well since the beginning

steam. It's not relegated to the history books. It's right now.

NEWTON: Now, Pat, you've embedded with these groups and you have the photos to prove it. We want to take a look at a few.

[15:45:00] I mean, this is the starting one from Charlottesville and you can see it there. It's a man in a KKK uniform. I mean, and all of -- that

that stands for, all the history that stands for.

And here is another group photographed in Charlottesville. We see the Confederate flag and a man giving a Nazi salute to that statue, that very

controversial statue there in Charlottesville.

And this one from Lexington, Virginia. This image of a man carrying that controversial flag while riding on a horse. Now, this was taken a few

years back.

I mean, Pat, tell us what's at work here. What is going through their minds? I know that I have heard that if you talk to these people at home

or in the workplace, they will sit there and tell you, you know, straight face, that they're not racist, that this is about something else.

JARRETT: Right, but that's seems to be old dog whistle. Over and over again, they will talk about they want what's best for their children,

implying that, perhaps, there is a group of people in this world that do not want children to have all the opportunity ahead of them. Like, that's

ridiculous. It's couched in this history and the ownership of history.

And, you know, you mentioned the photo from Lexington, of the man riding the horse, and that's from Lee Jackson Day. It's an annual celebration

here in the state -- in Virginia, celebrated only in Lexington and Richmond at this point, I believe.

And it used to be Lee Jackson King Day, celebrating Robert E. Lee, Stonewall Jackson, and Martin Luther King, Jr. And it's this old school

power. It's a show of power. It's a show of we're still here.

And much like the Lee statue and the Jackson's -- and Jackson statue in Charlottesville, they were placed there to remind the population that they

should keep in line. Lee's statue is right at the edge of the old Vinegar Hill neighborhood, which is a historically Black neighborhood. And it was

erected in 1924, which is -- was -- I mean, the Democratic National Convention that year was known as a Klan bake because it was so full of

Klan members.

And actually, the original photograph of the unveiling of Lee statue, you can see he is surrounded by white hoods like the one that you see in the

picture that you put on the screen just before. So it's all about power and White men retaining their White privilege.

NEWTON: And, Pat, a lot of these men, as you've shown, are young. What is it that they want exactly?

JARRETT: They will say that they want -- they will say it with a straight face, that they want to end White genocide and the erasure of White

culture. It's as if it were happening, you know. And it's -- from what I've seen, you know, there is a lot of talking about heritage and family

and history and that being the nod of it.

I think Lois Beckett, the reporter for "The Guardian," really got to a kernel of truth -- well, let me back up. When I was working with Lois on

the consortium in Kentucky, I spoke to a man. You know, it was a quiet moment during the -- believe it or not, it was a quiet moment because the

police had the place locked down, unlike in Charlottesville where it was chaos. It was relatively orderly in Paintsville (ph), Kentucky this year.

And I was talking to a White supremacist, and I said, would you please explain to me what the problem is? I said tell me what the big deal is,

the biggest problem in America today. And he said the biggest problem is multiculturalism.

And that confused me, so I said, well, take me back. What's the original sin of multiculturalism? And he responded that the original sin was when

we brought the African slaves over to America.

And I had to back up and say, well, what about, in your mind, the multiculturalism of Europeans coming to America to take over from the

Native Americans? And he said that that was just colonialism.

And so by that logic, multiculturalism, the active celebrating cultures from around the world and being friends with your neighbors is worse than

raping and pillaging.

NEWTON: Now --

JARRETT: And I don't understand that.

NEWTON: Pat, I want to ask you, in terms of how much this dovetails, whether he likes it or not, into President Trump and what his campaign

stood for, are they necessarily backers of the President?

JARRETT: From what I've seen and what I've heard, there are still a large contingent of these men that backed Trump.

[15:50:00] In Kentucky, there is a man wearing a shirt that said, "Donald Pump," and it was a picture of Donald Trump pumping iron. And I've seen a

lot of Trump support.

But there's also a large contingent of these guys that are losing faith in the President. Matthew Heimbach, the leader of the Traditionalist Worker

Party, he was suing -- I'm not sure it the lawsuit is completed, but he was suing Donald Trump for inciting violence at one of his rallies.

Heimbach was filmed pushing a young Black woman out of a rally, laying hands on her and shouting obscenities at her. And so he put the blame

squarely at the feet of Donald Trump, which is interesting to me.

So I think, slowly but surely, for whatever reason, whether he incited violence or, I've heard other people take umbrage with the power that Jared

Kushner has, they are turning against Trump, it seems. At least some of them.

NEWTON: Yes. And a reminder that Jared Kushner, his son-in-law, his daughter, Ivanka, and his grandchildren are, in fact, Jewish, devout Jews -

- practicing Jews. And that -- these groups have uttered a reason that they don't believe they should be in the White House. Hateful, hateful

stuff.

Pat, take us back to Charlottesville -- you were just there -- in terms of how stunning it must have been at that time, after the tragic events there.

JARRETT: It really was tragic, and I'll tell you, it's -- I worked with Chuck Reese over at "Bitter Southerner." It's a magazine -- it's an online

magazine based in Atlanta.

I've worked with him before and he called me up and said, hey, man, tell me what happened, and I gave a full account. And it's on them. It's on the

Web site today. And I think it resonates to read.

Even telling him and telling everybody else what happened, to actually read it is -- it hit -- even in my words and it hit me anyway. Because I was 10

feet away from that charger driven by Fields, and I saw the bodies fly.

I was following a parade of protesters. It was a joyous event. It was -- seemed triumphant. Most of the White supremacists had gotten out of town

at that point, and so it was a large parade of like a rag tag group of left-wing protesters.

And it was joyous. It felt like a block party. You know, people were high-fiving. People who were stuck in traffic were like high-fiving these

protesters in support. And we turn the -- the parade turn the corner on Fourth Street, and I heard a sickening sound of crunching metal, and I saw

the smoke and the bodies fly and then the screams.

And I -- it was -- it was awful. It was awful and something that I never want to hear or see again for as long as I live.

NEWTON: OK.

JARRETT: I was terrorized. I made a couple of pictures but then I had to stop working and I just had to walk away. And when I walked on to the

street, I saw car at the traffic light and I could feel my heart racing again. Because at that point, every car on the street was a weapon because

I just saw somebody because of one. I consider this an American terrorist attack.

NEWTON: Yes. I mean, Pat, your words are absolutely chilling. I thank you for sharing your journalism and your photography as it gives us

insights we couldn't have otherwise of what happened in those events and why they still resonate so much.

Pat, thanks very much.

JARRETT: Thank you very much.

NEWTON: Now, just to remind everyone, we are still waiting to hear from the U.S. President again. He is supposed to deliver remarks about

improving American infrastructure.

Of course, we'll be watching closely to see if he does address the events in Charlottesville again, if he decides he's going to take questions.

Obviously, he doesn't always take questions. He will likely be asked again about Charlottesville. We will go back to Trump Tower, just a few blocks

from here, as soon as that gets underway.

In the meantime, the Google engineer who was fired over his controversial memo on diversity has been embraced by the alt-right. But James Damore

tells CNN he is not an alt-right supporter and does not plan to participate in alt-right protests later this week at Google locations.

Now, Damore titled his 10-page manifesto, "Google's Ideological Echo Chamber." You may remember he claimed women are less biologically suited

than men for certain tech jobs. James Damore has been talking to CNN's Laurie Segall. She joins me now.

What was so interesting to hear from your interview was the fact that this really didn't amount to confession.

LAURIE SEGALL, CNN SENIOR TECHNOLOGY CORRESPONDENT: No, I mean, it was actually very interesting, and even to have him be open about it. And he

said that he thinks he has been, you know, portrayed in the wrong way.

[15:55:02] He thinks he was fired for the wrong reasons. Although, you know, Sundar Pichai, the CEO of Google, has said it was because of this

narrative he was putting forward on gender.

But I did ask him about the politics of it because it's become almost a political hot button issue. And I said, how does it feel to have the alt-

right take up your agenda? Listen to what he said.

(BEGIN VIDEO CLIP)

SEGALL: How do you feel about the alt-right taking up your agenda?

JAMES DAMORE, FORMER GOOGLE ENGINEER: I do not support the alt-right. Just because someone supports me doesn't mean that I support them.

SEGALL: Do you think they're more almost undercover conservative or undercover alt-right folks, I mean, people who are kind of afraid to speak

up in Silicon Valley?

DAMORE: Yes, there are many conservatives there in the closet quite literally in Silicon Valley. And I mean, I'm a centrist and I still can't

express many of my views.

SEGALL: Are some of the, as you called in, in the closet conservatives, reaching out to you? And if so, what -- it'd be great to know what are

they saying.

DAMORE: They largely agree with much of what I'm saying, and many have either left Google because the culture is very alienating towards them, or

are thinking about it because it's so bad. They don't feel like they can bring their whole selves to Google, and that that is a psychologically

unsafe environment where you feel like you have to constantly self-sensor yourself, and you have to stay in the closet and mask who you really are.

(END VIDEO CLIP)

SEGALL: And, Paula, what Google said -- I reached out and what they said is: an important part of our culture is a lively debate. But like any

workplace, that doesn't mean anything goes. And they said, you know, a lot of folks did feel unsafe. They felt discriminated against by his rhetoric

against women, Paula.

NEWTON: Yes, and they say not everything goes. Laurie, I'm really interested. You've done so much on the sexism in Harrington and Silicon

Valley, in itself. And of course, many of his statements resonated because of that, because of the claims he was making.

I mean, in terms of the sentiment that he is trying to express about other people, do they actually feel -- does he feel some kind of attack on free

speech?

SEGALL: Yes, I think that's what this whole kind of debate and what a lot of Silicon Valley companies are now dealing with, is this idea of free

speech and what do you even monitor on your platform. And what he said was, you know, he does think this is an attack on free speech.

He said he put his ideas out there, and he was essentially punished for it. And that's why I think you have the alt-right supporting him. He have a

lot of conservative pundits saying, you know, look, the Silicon Valley is left leaning. This culture is left leaning, and they say all these things

behind closed doors. They punish you for having that kind of opinion.

But that's just way too simplistic. I think that's only one part of the narrative. The other part of the narrative is that women have faced a lot

of barriers to entry in Silicon Valley. They've dealt with a lot of sexism in Silicon Valley.

And a lot of what he said, right, this idea that women aren't biologically -- biological causes mean that's why there's no -- women aren't in these

top tech positions. Or this idea that women are -- have more anxiety, which is why they can't handle high-stress jobs.

And also, Paula, a lot this science he relied on -- because he said he put this out there, this 10-page memo, in a very authoritative way relaying on

a lot of science. And a lot of sciences, by the way, specifically that he talked about have come out and said this -- don't use my science in this

way. You're oversimplifying it. This is the wrong way to use it. This is incorrect.

You know, so he has had a lot of pushback. And when Sundar, the CEO, put out this memo, he said, I appreciate this, you bringing up important topics

about diversity and about Google's programs and what we can do better and about ideology in the workplace.

But what he also said was, but, you know, you violated the code of conduct, which is every employee has the right to feel safe in the workplace and not

discriminated against and not in a place where there is bias. And when you made these comments about women not being biologically capable, you know,

you have violated --

NEWTON: OK. Laurie, I have to interrupt there. For a second there, Laurie. President Trump here at the mic from Trump Tower.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Great to be back in New York with all of our friends. And some great friends outside the building, I

must tell you.

I want to thank all of our distinguished guests who are with us today, including members of our cabinet: Treasury Secretary Stephen Mnuchin, OMB

Director Mick Mulvaney, and, of course, our Transportation Secretary, who is doing a fabulous job, Elaine Chao.

Thank you all for doing a really incredible and creative job on what we're going to be discussing today, which is infrastructure. We've just had a

great set of briefings upstairs on our infrastructure agenda.

My administration is working every day to deliver the world-class infrastructure that our people deserve and, frankly, that our country

deserves. That's why I just signed a new executive order to dramatically reform the nation's badly broken infrastructure permitting process.

[15:59:57] Just blocks away is the Empire State Building. It took 11 months to build the Empire State Building. But today, it can take as long

as a decade and much more than that.