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Early Start with John Berman and Zoraida Sambolin

European Union Diplomatic Cables Hack Linked To China; Facebook Let Tech Giants Around Privacy Wall; Senate GOP Drafting Stop-Gap Spending Bill To Avert Government Shutdown; Judge Suggests Michael Flynn Delay Sentencing. Aired 5:30-6a ET

Aired December 19, 2018 - 05:30   ET

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


(COMMERCIAL BREAK)

[05:30:32] DAVE BRIGGS, CNN ANCHOR: Another major hack, this one targeting the European Union. Thoughts on the president, on Russia, China, and more out in public this morning.

ALISON KOSIK, CNN ANCHOR: Senate Republicans working on a short-term plan to avert a government shutdown Friday night. The White House reversing course on demands to fund the border wall.

BRIGGS: Another disaster for Facebook. The social network struck deals. Over 150 companies giving them far more access to your data than it disclosed.

KOSIK: And a rescue for the ages caught on video in Texas. Two deputies rescue a man from a burning car.

Welcome back to EARLY START. I'm Alison Kosik. Good morning.

BRIGGS: I'm Dave Briggs. Good morning to you, Alison. Good morning to all of you. Five thirty-one on a Wednesday.

New this morning, "The New York Times" reporting that hackers infiltrated the European Union's diplomatic network, monitoring communications for years. The messages discovered by the cybersecurity firm Area 1.

CNN has not reviewed the documents yet but they expose the biggest, most serious concerns of countries around the world.

What's in them and who broke into the E.U.'s diplomatic system?

Samuel Burke answering those questions live from London this morning. Good morning, Samuel.

SAMUEL BURKE, TECH CORRESPONDENT, CNN BUSINESS: Good morning, Dave.

Certainly, President Trump would be among the first to recognize that he has a very different style from any of his predecessors when interacting with foreign dignitaries. Now, these cables give us an insight into what those diplomats and other heads of state feel when they walk away from these meetings.

Let me just put on the screen for you the most sensitive topics we see in these cables.

Trump's negotiations with China. President Xi quoted as saying working with Trump feels like a, quote, "no-rules freestyle boxing match." But more importantly, Xi is reported as saying that Beijing will not submit to the bullying, he called it, by the United States, even if a trade war hurts everybody.

Now, when it comes to relations with Russia, European diplomats described that meeting between Trump and President Putin in Finland back in July as successful, at least for Putin -- not necessarily for Trump and the United States.

Perhaps most worrying though when it comes to Russia, one of the cables says Crimea -- well, they describe it as a, quote, "hot zone where nuclear warheads might have already been deployed."

And even though the U.S. has pulled out of the Iran deal cable show, European diplomats requesting to finance exports to Iran to entice that country to continue complying with the 2015 agreement.

Now, I think you could summarize a lot of the European Union's attitude as feeling that Trump is very negative toward them. And so, they say feel a lot of, quote, "insecurity" as a result of that.

Now, of course, you want to know who's behind this and doesn't it feel a lot like WikiLeaks. Well, in the scope it does and maybe on the surface it feels that way, but let me just put up this on the screen.

Cybersecurity firm Area 1, which discovered these e-mails, says they were accessed using techniques resembling those often used by an elite unit of the China's People's Liberation Army, but it was just a simple phishing campaign and that diplomats in, of all places, Cypress.

Phishing is just when somebody sends you an e-mail. You click the link and enter your username and password thinking it's your own company, your own country, your own system. It turns out it's somebody else's and now they have your information to access the system.

And unlike WikiLeaks' high-level cables, well, these were sensitive but low-level classified documents. And, of course, they weren't published, Dave.

Important to point out in all of this, China's Ministry of Foreign Affairs says this "New York Times" report is suspicious, groundless, and extremely irresponsible. But, of course, it is cyberespionage, in part, that has this trade war going at full blast, Dave.

BRIGGS: Another reminder individuals, companies, countries -- even the E.U. vulnerable to hacks.

Samuel Burke live for us this morning in London, thank you.

KOSIK: Another black eye for Facebook and this one's a biggie. "The New York Times" reports the social network gave major tech companies much more access to people's data than it originally disclosed. The company was already reeling from a series of privacy scandals and now, hundreds of documents obtained by the "Times" detail, among other things, how Facebook allowed Microsoft's Bing search engine to see the names of virtually all of Facebook users' friends. Facebook also gave Netflix and Spotify the ability to read users' private messages.

BRIGGS: Facebook also allowed Amazon to obtain users' names and contact information through their friends, and let Yahoo! view friends' post as recently as this summer.

[05:35:03] Some of those companies offering varying levels of denials overnight. In total, more than 150 companies benefitted from the deals.

Facebook's director of public policy says none of the partnerships violated users' privacy. He says most of the partnerships did not require users' consent because Facebook considered the partners extensions of itself.

KOSIK: Senate Republicans are drafting a stop-gap spending bill to head off a partial government shutdown. The measure would fund about a quarter of the federal government until February. But some Republicans, they still want to negotiate a broader budget deal.

Meantime, the White House appears to be backing off the president's demand for $5 billion to fund a border wall.

KOSIK: Republicans, yesterday, proposed $1.6 billion for border fencing, with an extra billion for the president's immigration priorities. Democrats rejected that.

Majority Leader Mitch McConnell says he is sure there will not be a shutdown.

Right now, the best way to know what the president wants is, of course, is to watch his Twitter feed.

KOSIK: Blunt and forceful words in court for Michael Flynn -- "I am not hiding my disgust." That is what federal judge Emmet Sullivan said before he delayed sentencing Michael Flynn for lying to the FBI.

At Sullivan's urging, the former national security adviser asked to postpone. Flynn wants more time to cooperate with federal investigators.

BRIGGS: Special counsel Robert Mueller's team suggested little to no prison time for Flynn, but Sullivan's frustration was evident. His voice growing harsh as he vilified Flynn. The judge ordered Flynn to stay within 50 miles of Washington and surrender his passport in January.

Let's talk about all of this with CNN Digital Politics director Zachary Wolf, live in D.C. this morning. Good to see you, sir.

KOSIK: Good morning, Zach.

ZACHARY WOLF, DIGITAL DIRECTOR, CNN POLITICS: Good morning.

BRIGGS: And let's work backward and start with that imminent government shutdown. I'm a betting man, so what are the odds on a shutdown as the president leaves town?

And are we now talking, Zach, about a semantic debate? The president tweeting yesterday, "We're talking about artistically-designed steel slats" --

WOLF: A beautiful wall.

BRIGGS: -- not necessarily a concrete border wall.

So is this about semantics?

WOLF: It could end up being about semantics.

But I think, really -- ultimately, it's going to be about how many billions of dollars they could get to say that they're building this border wall. It could be a fence. It could be -- you know, whatever it is they're building down there, Trump wants to call it a wall. Maybe we'll end up doing that -- I don't know.

But he wants something in the neighborhood of $5 billion. Senate Republicans seem to think that well, maybe we can -- we can make it $1 billion. And, Democrats seems to want nothing right now.

This is not going to be the end of this issue, whatever the endgame is this week or this month. It's really going to be a next-year thing when the -- when the Democrats take control of the House and they really kind of get going fighting with each other. So this is just sparring before the main event when Democrats take control.

BRIGGS: So no shutdown, you say.

WOLF: No. And by the way, I wanted to say I am not a betting man in the Trump era. I have left that part of my life behind me, as most people should --

BRIGGS: Yes.

WOLF: -- in Washington today.

But, I -- yes, it doesn't seem like we're headed in that direction. But until Donald Trump signs something, I'm not going to assume that anything is going to happen.

BRIGGS: You got me. I'm going to swear of betting on this administration, as well. Good advice.

KOSIK: All right, let's switch gears to Michael Flynn. The judge delaying his sentencing yesterday in this dramatic twist --

BRIGGS: Yes.

KOSIK: -- that really no one expected. I found it interesting that the judge said the pause is going to be given to give Flynn more time to cooperate.

Does this mean that Flynn has an even bigger card to hand over? What is this more time to cooperate really mean? Translate for me.

WOLF: I think the question of what Michael Flynn has given Robert Mueller is at the heart of everything that should be keeping Donald Trump up at night. And that, you know, kind of the nice -- the good energy that Donald Trump has been sending towards Michael Flynn suggesting that he's been tricked and all of these others things --

KOSIK: And not calling him a rat.

WOLF: Exactly -- and not calling him rat even though he met with Mueller 19 times since his guilty plea.

So his cooperation is something that -- I think we'll ultimately have to see what happens when Mueller plays his cards. But it's kind of the unwritten -- this is what everyone is waiting to see and the judge apparently, just like the rest of us, is excited to see how this plays out.

BRIGGS: The judge did make a few mistakes yesterday which was very surprising. Did not have a certain owning of the facts there that he was not lobbying on behalf of a foreign government while national security adviser. The judge had to walk back some of those things.

But the White House not walking back their support for Michael Flynn nor the notion that Michael Flynn was somehow tricked or sabotaged by the FBI.

Here's Sarah Sanders, yesterday, on that.

[05:40:00] (BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Flynn said that he knew it was illegal to lie to the FBI and he was ready to accept responsibility, this well before agreeing to a delay of sentencing. Given that, are you in a position now or would you like to revisit your comments earlier today that the FBI ambushed Flynn?

SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: No. I -- we still firmly believe. We don't have any reason to want to walk that back.

(END VIDEO CLIP)

BRIGGS: Why does the White House continue to stand by Michael Flynn? Is there any theories on that? And is she any different now than Rudy Giuliani, at this point?

WOLF: No, I think they're both sticking up for their boss. And I -- you know, I'm not sure -- it's a hard job, I think, defending him and, you know -- I don't know. That's a difficult one.

BRIGGS: Sure. Truth is not that hard. The job is certainly hard but -- you know, it's interesting whether or not she's speaking on behalf of the United States government, the White House or just defending, to your point, her boss.

But what is the theory why they differ Michael Cohen from Michael Flynn?

WOLF: Well, Michael Cohen has obviously come out and very publicly essentially turned on the president. Michael Flynn may be -- you know, when he's meeting with Mueller, is he still trying to defend his boss? I think that's an open question.

Is there -- is there the possibility of a pardon for him if he doesn't flip too far? It all depends on what Flynn has said and something in there seems to lead the White House and President Trump to think that he's somebody they want to keep on their side, essentially.

BRIGGS: Yes. It's just hard to forget these words -- "Arguably, you sold your country out" coming from a judge to a former --

KOSIK: Yes.

WOLF: Incredible.

BRIGGS: -- national security adviser.

KOSIK: Shaming him in court.

BRIGGS: Zach Wolf, thanks for being here. Appreciate it.

KOSIK: Zach, thanks very much.

WOLF: Thanks.

BRIGGS: All right. Criminal justice reform close to becoming reality. The Senate overwhelmingly passed a bill that eases sentences for non-violent offenders hoping to reduce recidivism and the federal prison population.

All the senators opposed were Republicans who feel the reforms go too far and could allow dangerous criminals back into society.

The House is likely to take up that bill today and approve it, sending the bill to the president, who has also expressed support.

KOSIK: OK, remember when President Trump said this?

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: It's going to be a tax reduction of 10 percent for the middle-class. Business will not enter into it. And this will be on top of the tax reduction that the middle-class has already gotten.

And we're putting in a resolution, probably this week. I think you folks know about it. And Kevin Brady's been working on it very hard, really, for a couple of months.

(END VIDEO CLIP) KOSIK: Hmm, OK. Well now, the Trump administration is actually backing off the president's promise of 10 percent tax cut for the middle-class.

In an interview with "Bloomberg," Treasury Sec. Steve Mnuchin -- he wouldn't comment on the idea that President Trump floated before the midterms.

He said, "I'm not going to comment on whether it is a real thing or a not a real thing. I'm saying for the moment, we have other things we're focused on." Try telling that to middle-class taxpayers.

Mnuchin said the administration will focus on its tax efforts on fixing mistakes in the 2017 overhaul, such as drafting a -- you know, fixing drafting errors that deny retailers and restaurants tax breaks when they make renovations to their establishments.

BRIGGS: OK. President Trump's personal charitable foundation folding up amid a lawsuit over its finances. The New York attorney general's suit claims the president and his three eldest children abused the foundation's tax-exempt status and violated campaign finance laws by coordinating with the 2016 campaign.

The suit alleges the foundation was used, quote, "as little more than a checkbook to serve Mr. Trump's business and political interests."

The agreement to dissolve allows the A.G.'s office to review the recipients of the charity's assets.

The largest donation, a $264,000 gift to the Central Park Conservancy back in 1989 appeared to benefit Mr. Trump's business. It paid to restore a fountain right outside Trump's Plaza Hotel.

An attorney for the charity called the A.G.'s statement misleading, saying the foundation had been trying to dissolve since Trump's election but was blocked by the A.G.

So they own a couple of assets -- two portraits the president purchased of himself, and a Tim Tebow autographed Broncos helmet. They were purchased for $42,000. They're now valuing them at $975 combined.

KOSIK: Not so sure I would classify those items are charity.

BRIGGS: It reeks below the surface. It is some shady stuff.

KOSIK: All right. She was the creative genius behind classic scenes like this.

(BEGIN VIDEO CLIP)

Clip from the movie "Big."

(END VIDEO CLIP)

KOSIK: Actor and director Penny Marshall has died. More on her legacy, next.

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[05:48:54] KOSIK: The Yemeni mother of a 2-year-old boy on life support in California will arrive in the United States this evening. Shaima Swileh was unable to enter the U.S. because of the White House travel ban, but her expedited visa to travel from Cairo -- it was finally approved.

Her husband, Ali Hassan, tells CNN U.S. Consulate officials in Cairo apologized to his wife for delaying her visa waiver.

Swileh plans to go to her son's hospital in Oakland, California immediately to say her goodbyes.

BRIGGS: Family, friends, and fans around the world mourning the death of actress-turned-trailblazing-director, Penny Marshall.

Marshall shot to stardom in the 1980s, earning three Golden Globe nominations for playing Laverne in the classic sitcom "LAVERNE AND SHIRLEY" before directing hit movies like "Big" starring Tom Hanks.

Marshall then found huge success with the women's baseball comedy, "A League of Their Own." In an interview, Marshall explained why she wanted to make the film.

[05:50:02] (BEGIN VIDEO CLIP)

PENNY MARSHALL, ACTRESS-DIRECTOR: No girl wanted to write it. They don't like baseball.

(END VIDEO CLIP)

BRIGGS: A family spokesman says Penny died in her Hollywood Hills home of complications from diabetes. She was 75.

KOSIK: Quickly, finish this sentence. Schlemiel! Schlimazel!

BRIGGS: You do it, please. You do it better.

KOSIK: Hasenpfeffer Incorporated.

BRIGGS: Brilliant, well done. Too early for me to nail that.

KOSIK: Love that show.

All right, let's talk business.

Global markets are mixed ahead of the Federal Reserve's decision on interest rates. In Asia, the Nikkei and Shanghai both closed lower. The Hang Seng closed slightly higher. European markets are in the green in early trading.

And on Wall Street, futures are higher ahead of the decision today. Yesterday, the Dow closed 83 points higher. The S&P 500 ended virtually unchanged, while the Nasdaq gained fracturally. Now, both the Dow and the S&P 500 -- they're on track for their worst December since the Great Depression.

But, once again, all eyes are really going to be on the Federal Reserve this afternoon. The Fed is expected to raise interest rates for a fourth time this year.

Imagine this, traveling underground in Los Angeles at 150 miles an hour. Tesla CEO Elon Musk -- he's debuted a prototype for his tunnel venture, The Boring Company. This happening in Hawthorne, California.

Now, guests were invited to take this really cool looking demo ride inside the subterranean tube at 40 miles an hour. Musk says he hopes for these cars to reach up to 150 miles an hour.

Musk also plans for cars to access the tunnels, using ramps and elevators, around the world.

According to The Boring Company, fares for the tunnel aren't finalized yet but he says they're going to be comparable to or lower than public transportation fares for pedestrians.

I say get here quickly because give the MTA a run for its money. That's just my opinion.

All right, one more. You can fly with your emotional support dog, but what about an emotional support snack? Popeyes announced they're launching emotional support chickens to help offset some of the stress that comes with traveling during the holidays.

But you won't be seeing feathers on your flight. The fast-food chain is serving their 3-piece chicken tenders combo in a carrier that's shaped like a chicken to give travelers a goodhearted laugh. The carrier, though, is only available from Popeyes at the Philadelphia International Airport.

Are you going to be headed there to grab one of those?

BRIGGS: I'll take a layover through Philly on my way home to Denver, absolutely.

We'll be right back.

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[05:56:49] KOSIK: Welcome back.

The video that you're about to see will terrify you but inspire you. Watch as two Texas deputies rescue a man from a burning car.

(BEGIN VIDEO CLIP)

BRADEON BOZNANGO, DEPUTY, CHAMBERS COUNTY, TEXAS: Braedon Boznango: Sir?

UNIDENTIFIED FEMALE: Hurry, hurry, hurry. Just grab him and go.

BOZNANGO: Sir? UNIDENTIFIED FEMALE: Pull him.

BOZNANGO: Give me your arms.

UNIDENTIFIED FEMALE: Hurry.

BOZNANGO: Carlton, I need your help.

UNIDENTIFIED FEMALE: Grab him.

(END VIDEO CLIP)

KOSIK: That is courage in action. Bodycam footage from last week shows Chambers County deputies Braedon Boznango and Carlton Carrington running toward a burning car. The two officers dragged the unconscious man out. He is in stable condition.

BRIGGS: More than a dozen companies are pulling or suspending advertising from Tucker Carlson's Fox News show. Left-leaning activists and organizations pressured sponsors to pull out after Carlson told his viewers last week mass immigration, quote, "makes our country poorer, dirtier, and more divided." He defended those remarks on Monday.

Fox News backing Carlson, saying, "We cannot and will not allow voices like Tucker Carlson to be censored by agenda-driven intimidation efforts."

KOSIK: Looks like revenge is best served with glitter. After having a package stolen off his doorstep, former NASA engineer Mark Rober took advantage of his background to get back at would-be thieves with what else but a glitter bomb.

The package he created contains one pound of fine glitter and some pungent spray so when the package opens it bursts glitter on the thieves. Rober even took it one step further by attaching four phones on the device to, what else, record their reactions.

This is really interesting and intricate and I think this guy's got a lot of time on his hands. But something tells me he's so smart that he thought of this in a snap.

BRIGGS: That's how Steve Jobs would get revenge.

OK, an update now on a trending story we told you about yesterday. The "Carlton" is the subject of a lawsuit. Actor Alfonso Ribeiro suing the makers of Fortnite over the use of his famous Fresh Prince dance. Also suing Epic Games is Backpack Kid over his signature "Floss" or pickle dance.

I spoke to the world's most famous Fortnite player. He's known as Ninja.

(BEGIN VIDEO CLIP)

BRIGGS: If you helped get these dances and popularized the dances, should people be paid for them? And how, essentially, are they for the popularity of the game?

TYLER "NINJA" BLEVINS, PROFESSIONAL VIDEO GAMER: Absolutely. That would -- that's his dance, man. So new dances, when all these artists and actors and stuff like that -- they're coming out with these -- they definitely, in my opinion, should be working -- working with Epic and being, you know, put in the game.

BRIGGS: And I want to know what your favorite dance is.

BLEVINS: It's probably -- I love the Floss. It's a classic, man. But I think "Jubilation" is just classic.

(END VIDEO CLIP)

BRIGGS: I'm a kind of "Take The L" guy. Do you know that dance?

KOSIK: Is that actually a dance.

BRIGGS: "Take The L"? Oh, man.

KOSIK: Doesn't that -- doesn't that stand for loser?

BRIGGS: Yes, exactly.

KOSIK: I'm more about the flossing.

BRIGGS: OK.

KOSIK: Thanks for joining us. I'm Alison Kosik.

BRIGGS: I'm Dave Briggs. Here's "NEW DAY."

(BEGIN VIDEO CLIP)

SANDERS: The FBI broke standard protocol in the way that they came in and ambushed Gen. Flynn.

JAMES COMEY, FORMER DIRECTOR, FBI: I'm very proud of the way the FBI conducted itself.

UNIDENTIFIED MALE: This judge repeatedly went back to Flynn to make him say that he was, indeed, guilty.