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U.S.-China Trade War; White House Asked McGahn to Say Trump Didn't Obstruct Justice; Giuliani No Longer Going to Ukraine; House Committee Issues Subpoenas for Trump's Taxes; North Korea Waiting for Trump to Blink or Leave Office; Remembering Kendrick Castillo; Hostages Freed in Burkina Faso; Billionaires' Space Race; Protest Projectiles. Aired 4-5a ET

Aired May 11, 2019 - 04:00   ET




GEORGE HOWELL, CNN ANCHOR (voice-over): No deal between the U.S. and China as trade talks stall without an agreement. More on what happens, ahead.

NATALIE ALLEN, CNN ANCHOR (voice-over): An order denied. The White House reportedly asked former White House counsel Don McGahn to declare the president did not obstruct justice. And McGahn declined to do so.

HOWELL (voice-over): Also ahead this hour, a family in mourning, we'll hear from the parents of the student hero who died when he charged at the Colorado school shooter, giving his classmates time to get out of harm's way.

ALLEN (voice-over): Welcome to our viewers here in the U.S. and around the world. We're coming to you live from Atlanta. I'm Natalie Allen.

HOWELL (voice-over): And I'm George Howell. NEWSROOM starts now.


HOWELL: We start with China, the looming threat of an all-out trade war now greater than ever, less than 24 hours after hiking U.S. tariffs from 10 percent to 25 percent, on $200 billion of Chinese imports. The Trump administration now says that it is moving ahead to levy duties on just about everything that comes into the United States with the label made in China.

ALLEN: The move is after two days of trade talks in Washington failed to break the impasse. If the proposed new tariffs take effect, it almost certainly means higher prices for American consumers on thousands of ordinary goods like shoes, toys, televisions, appliances and clothing. Beijing has promised countermeasures but has not said what, how or when.

CNN's Matt Rivers joins us from the Chinese port city of Tianjin. And the question is, Matt, how might China retaliate?

MATT RIVERS, CNN CORRESPONDENT: It is interesting that China hasn't officially come out with how they will retaliate yet. Usually they will come out with how they are planning to follow up when the United States does something like raising tariffs in relatively short order. So we do expect to hear something if not today or tomorrow, almost assuredly by Monday.

But there is no guarantee of that. When they decide to retaliate, it can take a wide range of different forms. But I think there is a couple things that might seem more obvious than other options.

First thing you're looking at, I think, is both broadening and increasing tariffs here on American imports. So when American imports come into ports like the one behind me here, most American imports are already facing tariffs as a result of the trade war that has been going on for about a year now.

The Chinese could put tariffs on the rest of American imports, covering every single American import here to China. But then they could also take the rates and hike them, like the United States did on Friday , from 10 percent to 25 percent.

The other thing they could come is issue a market access. So if you are an American pharmaceutical company and you are trying to license a new product here in China, perhaps China's regulating agencies won't let you do that. And that hurts your bottom line. So that could hurt American companies.

And then something that could happen; earlier in the trade war, American soybeans, which is one of the largest exports to China, worth billions each year, soybeans purchases here in China were cut off. Chinese firms were barred by the state from purchasing American soybeans. It was devastating to U.S. farmers.

During the negotiations, things went better and China lifted those restrictions. But could they put them back on? That is one pointed thing that they have. We don't know what they're going to do but they have a wide range of options.

ALLEN: Let's talk about what is at the core of this impasse.

What differences exist that are preventing a deal?

RIVERS: Well, I think what you're having here -- and it has been the same problem since the very beginning -- the United States wants structural changes to China's economy and China, meanwhile, has based its entire economy around a series of principles. So let's hear from the chief economic negotiator, who spoke to reporters in Washington.


LIU HE, CHINESE VICE PREMIER (through translator): At present, both sides have reached consensus in many aspects. But frankly speaking, differences still exist. We think these differences are crucial issues --


LIU (through translator): regarding our principle. Every country has its principle. And we will make no concessions on matters of principle.


RIVERS: So when it comes to principle, what he is talking about there is that China is a state run economy, the government has its hands in just about every major industry in this country. And that is what the United States has a fundamental problem with.

So what the U.S. has basically been arguing, without getting deep into the weeds here, is that China gives its companies an unfair advantage because of being run by the state. But China says that is how we do things here, we're not changing it.

So it is really unclear exactly how we'll move past this, what the halfway between both sides' position actually is.

ALLEN: Matt Rivers, with a view from Tianjin, thank you.

HOWELL: Let's get context now with Linda Yueh, an economist and the author of "The Great Economists: How Their Ideas Can Help Us Today," joining us from London.

Good to have you with us.

LINDA YUEH, AUTHOR: Good morning, George.

HOWELL: So no deal in the trade talks. The rhetoric seems to show both sides clearly digging in. China's President Xi Jinping saying that his nation's economy is strong enough to endure this through the long run. President Trump saying that America is negotiating from a place of strength.

So if it comes down to who blinks first, who do you believe has the stronger hand?

YUEH: Yes, that is a great question. I'm not sure that either side has that strong a hand. But I would break it down this way.

In the short term, if China retaliates, pretty strongly. But even if they don't, the United States, if it goes ahead and places say a 125 percent tax on all Chinese imports, so that is about $500 billion, about half of that -- well, half to a third are actually consumer electronics.

So U.S. consumers will certainly be hit in the short run. Say China retaliates strongly so it really hits farmers. We've already seen the United States spend $12 billion on subsidies to farmers. And President Trump has also said by the Department of Agriculture that they will buy the things that China is no longer buying. So that is a massive amount of spending in the short term. Because

China imports less from the United States, about $200 billion, they will be hit in their supply chains but the longer term impact is probably greater for China.

Over the medium term, China is a middle income country, hoping to catch up. If it is cut out of the United States in terms of technology access and markets, it may actually mean that it is harder for China to catch up, know what the global technology standards are and actually grow prosperous.

So I would say, yes, short term effects on both sides. You've already seen government spending and policies to counteract that. But in the medium term, the U.S. is a rich country and China is a middle income country. So being cut off from the world's biggest market, I think, is something that has got to weigh on the mind of Chinese policymakers.

HOWELL: And you talk about the impact on the United States, you talk about farmers.

But isn't it the case that many of the places that would be hit hardest are those red states, those Trump country states?

YUEH: Yes, absolutely. I have no doubt that lot of the focus on farmers and a lot of the focus in terms of the Midwest, in particular, those are, of course, key political battlegrounds.

We have an election coming up next year. And so this is why I think that there was a real expectation in financial markets that there would be a deal. And, in fact, up until really this past week, there was a sense that, because of how China's targeted retaliation was really focused politically, that that might induce a deal.

Well, that and the fact that it seemed like they were making progress on the enforcement mechanism because that has always been the sticking point, Which is if the United States doesn't trust China to abide by its agreements, the U.S. wanted to see the changes in law around intellectual property rights protection, making that effective and support its state-owned enterprises.

And apparently that was a step too far because the Chinese have a different view of actually of deal. China normally think that if you sign a deal, that is when the negotiations start. So I think there is a fundamental difference between the two sides.

But because of the political imperative to get a deal done before the 2020 election, both sides may have overestimated the willingness of both sides to come to a deal.

HOWELL: President Trump has argued that the tariffs actually bring wealth into the country.

But is that a misconception?

Help our viewers to understand, where is that money coming from? YUEH: So you certainly do make tax revenues because remember tariffs are just a tax on imports. So 25 percent on $200 billion worth of Chinese exports --


YUEH: -- to the United States, it will add to the U.S. government's coffers.

But the cost in terms of -- think about what the cost to the wider economy will be. So for consumers, prices will almost certainly go up if taxes go that high and it encompasses all of Chinese imports, because that is mostly, as we said, a half to a third are consumer electronics.

So that's going to weigh on growth. And for companies, remember, China and the U.S. are very connected through supply chains. So a lot of margins in supply chains are really tight, maybe only a few percentage points.

So you put a big tax on that, that will add to the cost of companies. When companies find it more expensive to produce, it is not just that they will raise the price of products, they are probably going to have much greater wage pressure, keeping wages down in their factories, maybe even leading to wider employment effects.

So now when you take that into consideration, the dampening effect on investment and the U.S. is a massive economy, $20 trillion or so, that is probably going to outweigh the tax revenue that immediately comes in from the purchases.

And if the tariffs are really going to bite, you may actually see -- and this is one of the things that I'm a bit concerned about -- Chinese exports to the U.S. will probably decline because people will start buying other things.

That, of course, will bring down the tax revenues. But that also suggests, you know, there will be distortions in terms of what companies and consumers buy.

So, of course, there are issues around the level playing field. China's markets need to be more open. But I think there is only going to be -- one has to be very realistic about the economic harm that will come from opening up China, from using tariffs versus other means.

And to be fair, other means hasn't really worked very well. But we just have to be cognizant of the cost of doing this and hope for longer term gain if there is structural change in China that really levels the playing field a bit more.

HOWELL: Linda Yueh, thank you again for your time.

YUEH: Thank you.

ALLEN: We turn now to the Middle East, where a military standoff between the U.S. and Iran is escalating. The Pentagon says that it is deploying more Patriot missiles to the Middle East to deter potential Iranian attacks.

HOWELL: The United States insists it does not want war but it gave Switzerland a phone number that Iran can use to call President Trump. CNN's Michelle Kosinski has this from the State Department.


MICHELLE KOSINSKI, CNN SENIOR DIPLOMATIC CORRESPONDENT: Not only is the U.S. sending a carrier strike group and a bomber task force to the Persian Gulf, now comes word that the U.S. is also sending an additional ship as well as a Patriot missile battery to the region.

This is defensive equipment. Patriot missiles are designed to shoot down incoming ballistic missiles and other weapons. The Defense Department isn't saying exactly where these will be placed but they are saying it is part of countering the current Iranian threats.

Over the last several days, U.S. officials have picked up imagery and intercept, action by Iran in the Persian Gulf, of them moving ballistic missiles around on boats. These aren't just any Iranian navy boats, either. These are assets, according to officials, of the high level Iranian Revolutionary Guard.

So this is seen as not just concerning but also potentially Iran actively planning attacks against U.S. troops and U.S. assets in the region as well as allies. And secretary of state Mike Pompeo described this as an imminent threat the other day.

So this is the latest U.S. show of force to counter that threat. One Defense official told CNN's Barbara Starr that the U.S. is looking for signs that Iran is changing its behavior on this and backing off of this threat. But they are just not seeing any sign of that at this point -- Michelle Kosinski, CNN, the State Department.


HOWELL: The question of whether the U.S. president obstructed justice. We understand he wanted the former White House counsel to publicly say no but Don McGahn refused to do it. We'll have the details on that story ahead for you.

ALLEN: Also ahead this hour, flash flood warnings in Texas as heavy rains are battering the state. Our Derek Van Dam will tell us what is coming next.





(MUSIC PLAYING) HOWELL: New details about how the Trump administration tried to

control the fallout from the Mueller report.

ALLEN: Sources tell CNN that the White House asked former White House counsel Don McGahn state publicly that President Trump did not obstruct justice. McGahn refused and that upset the president.

HOWELL: According to an administration official and another source, McGahn had previously told investigators for special counsel Robert Mueller that he didn't think Trump had obstructed justice. But McGahn and his lawyer didn't believe a statement was necessary, since the attorney general, William Barr, had already come out and said Trump did not obstruct justice.

In the meantime, Democrats in the House have subpoenaed the U.S. Treasury Secretary and the nation's tax chair (ph) to turn over the president's tax returns.

ALLEN: And earlier this week Treasury Secretary Steve Mnuchin refused to turn over six years of returns per the House's request. He says there was no legitimate legislative purpose for it and they have until next Friday to comply.

Well, Mr. Trump's personal lawyer says he is not going to Ukraine after all.

HOWELL: We're talking about Rudy Giuliani, who had planned to push Ukraine to investigate the Democratic presidential candidate, Joe Biden, and to look into Biden's call in 2016 to have a Ukranian prosecutor removed. That prosecutor had investigated a natural gas company connected to Biden's son.

But late Friday night, Giuliani had called off the trip. Listen.


RUDY GIULIANI, TRUMP ATTORNEY: I've decided, Sharon, I'm not going to go to the Ukraine.

SHARON, FOX NEWS ANCHOR: You're not going to go?

GIULIANI: I'm not going to go because I think I'm walking into a group of people that are enemies of the president --


GIULIANI: -- in some cases enemies of the United States and in one case, one already convicted person who has been found to be involved in assisting the Democrats with the 2016 election.


HOWELL: We should point out it is not clear who Giuliani was talking about in that instance.

ALLEN: Let's get perspective on this busy week in Washington, we're joined by Natasha Lindstaedt, professor of government at the University of Essex.

Thanks for being with us. Let's get right to it. Let's start with the story on Rudy Giuliani. All set to go to Ukraine to investigate Mr. Biden.

But given all the controversy over election meddling, was that trip ever a good idea?

NATASHA LINDSTAEDT, UNIVERSITY OF ESSEX: No, it was a terrible idea from the start. So he made the right decision by backing out of this.

There has been constant accusations that the Trump team is entangled with Russians and Ukranians in ways that would be unsavory and not really particularly helpful to U.S. stability.

And so it would be best if the Trump administration was able to distance itself from the Russians, from the Ukrainians and not get mired in this mess. So he made the right decision by backing out of that particular trip.

ALLEN: CNN has learned that Don McGahn, as we mentioned, was asked by the White House to say publicly that Mr. Trump did not obstruct justice. And McGahn declined that request.

Why would the White House be so keen on him making that statement?

LINDSTAEDT: The White House wants -- Trump in particular -- wants to prove to the world that he is fully exonerated. I guess it is not enough that Barr, the attorney general, has gone out of his way to exonerate the president in a press conference and through the four- page summary.

And he wants Don McGahn to step up and do the same publicly. This would not be in Don McGahn's interests. He doesn't want to get mired in this mess anymore and he already stated that Barr had made the point clear that he doesn't need to get involved in this.

But Trump demands loyalty from all those who work for him. And so this is another example of him demanding loyalty and trying to exert his influence over people who work for him and for them to be very public in their support for him.

ALLEN: Right, 30 hours of testimony McGahn gave to the Mueller team. Doesn't seem like he wants to give much more chit-chat about all of that at this point.

And on another front, subpoenas have been issued for Mr. Trump's tax returns but, like other issues, the White House doesn't appear to be cooperating. Democratic leaders are saying, without checks and balances, the U.S. is in a constitutional crisis.

How do you see it?

LINDSTAEDT: Yes, I would agree, we are definitely in a constitutional crisis and I think there is unprecedented levels of conflict between the executive branch and the legislative branch like we have never really seen before. And it seems like it will all play out in court battles.

If we just look at the fact that Barr will likely be held in contempt of Congress when they fully vote on that, then it will require a court action, a court order . And then that could get mired in the courts and then end up in the Supreme Court.

And how the courts decide to vote on this is really, really critical about how much executive power the president should have vis-a-vis the legislative branch. And the courts at this time really seem to be leaning pro executive power and this is in contrast to years past, where in the Supreme Court in 1973, ruled against Richard Nixon's attempt to exert executive privilege.

And we don't really know how the courts will vote on these kinds of issues under Trump. It seems to be a completely different court.

And then the other issue, it seems like Trump's strategy is to really just delay things. We have no idea how long this is going to take. If we look back to 2012, when Eric Holder was held under contempt, he just delayed and the whole matter wasn't settled for another 4.5 years.

So regarding this whole constitutional crisis, we have real big issues ahead of us and the courts will end up deciding it and we don't know how long it will take.

ALLEN: So you can kind of understand why the White House is stonewalling, just to put it off but it is one thing after another and Republicans would say that the Democrats are just continuing to fish for things that aren't there.

Even the former attorney general, Jeff Sessions, remember Jeff, said Friday, well, this is all just one big squabble. He reduced it to that.

LINDSTAEDT: Yes, and I think that is what the Republicans have been very adamant about. They don't think that there is really any need to subpoena -- or to get a hold of Trump's tax returns.

They think this is weaponizing the IRS; the unredacted version of the Mueller report is not necessary to be provided because there is only 10 percent that is missing.


LINDSTAEDT: They feel Trump has been fully exonerated and they think that the Democrats are completely focused on trying to get Trump out of power, trying to get access to all these different types of documents that are completely unnecessary.

And if you were to look at not just the Republican congressmen but the Republican public, voters that are Republican, would agree with this, that they think this is just a complete waste of time, very, very partisan and it is just a sign that U .S. politics has become more polarized than ever. ALLEN: But if the White House continues to stonewall and therefore keep a congressional committee from doing its job of oversight, is that an impeachment offense?

Democrats have been dancing around that word for some time.

LINDSTAEDT: The Democrats are split on this. You have younger members of the House, some of the newer members of the House, that really want to impeach and you also have to look at what their views on this, that they feel that there have been tons of impeachable offenses, just looking in the Mueller report, all the instances of obstruction of justice.

But the senior members and namely Nancy Pelosi have said that we need to really make the case to the U.S. public. We really need to not be too aggressive, not incur a huge amount of backlash that could really punish the Democrats in 2020 if they overreach.

So she is urging for calm and to take their time in proving to the U.S. public that what Donald Trump has done is truly worthy of being impeached.

ALLEN: Natasha Lindstaedt, thanks so much for being with us.

LINDSTAEDT: Thanks for having me.

HOWELL: The U.S. president says he doesn't think the North Korean missile tests are a breach of trust. Why he believes his relationship with Kim Jong-un still has potential.

ALLEN: We'll have that ahead. Plus, he's gone now but Kendrick Castillo will always be remembered a hero, who lunged at a gunman at his school to save fellow students. Ahead here, we hear from Kendrick's parents.





ALLEN: Welcome back to our viewers. This is CNN NEWSROOM. I'm Natalie Allen.

HOWELL: And I'm George Howell with the headlines we're following.


HOWELL: Anna, so it does appear that the response on both sides is measured to maintain this relationship.

ANNA COREN, CNN CORRESPONDENT: Yes, that's right. And I guess there is just too much at stake, at least at the moment. We have to remember that Donald Trump is the first U.S. president to sit down with a North Korean dictator at that famous Singapore summit last year, where there seemed to be a bromance that really began and blossomed between the two leaders.

Obviously that didn't necessarily continue in Vietnam at the Hanoi summit earlier this year, when Trump walked away from those negotiations. Obviously America wants North Korea to denuclearize and, if they denuclearize, then they will lift the sanctions that are strangling the economy in North Korea.

But you have to assume that the rounds of short-range missiles that have been fired, the second just a few days ago, second in a week, that Kim Jong-un is certainly sending a message that he wants America's attention, he wants Donald Trump's attention and he wants talks to resume.

But we heard from Donald Trump and while he said that he is not happy with the situation, he said that there is still a relationship but that North Korea doesn't appear to be ready to talk at this moment.

So you'd have to read between the lines and assume that the United States has no intentions of returning to the negotiating table at the present moment.

HOWELL: Anna Coren, live in Hong Kong, thank you.

Now to the U.S. state of Colorado and the deadly school shooting. Two teenagers suspected of opening fire at the STEM School Highlands Ranch are expected to appear in court next week. The 18- and 16-year olds are facing murder, attempted murder and possibly other charges.

ALLEN: One student was killed and eight others wounded just three days before the last day of school. Kendrick Castillo died, charging one of the gunmen and he is being remembered a hero.

HOWELL: His parents say they aren't surprised that he leaped into action. Chris Cuomo spoke to them earlier.


CHRIS CUOMO, CNN HOST: How are you handling the situation so far?

JOHN CASTILLO, KENDRICK'S FATHER: You know, it's -- it's an emotional roller coaster. It's a -- you know, we're fine when we're busy and occupied and there's a lot of that right now, I mean with meeting people and everyone telling us, you know, what a hero that our son is and we love that.

But, you know, I'm not going to lie to you. I wake up in the morning and I sob and I cry and I can't believe that this event has taken place. And both of us are heartbroken that, you know, there's been a -- an integral piece of our lives that's been taken away from us that we'll never get back.

CUOMO: This is your only son. Today would have been his last day of school.

What does that mean to you?

J. CASTILLO: That's correct. Yes. I can't even express what that means. You know, it's a


J. CASTILLO: -- it's the hard cut-off, you know, life stops. It stopped when we found out that his life was taken and he was deceased. It's a -- all of our -- all of our everything, you know.

You wake up every day and we -- we -- we thought that he would have a promising future in engineering and, you know, going off to college and we're looking to celebrate, have fun and it's turned to tragedy.

So, yes, that's -- that's what it means for us. It's like life has literally stopped. I mean we -- our purpose has gone away. And I don't know. You know, our only child -- I -- I just don't know. I can't even express how I feel.

And, you know, I -- I put on a facade to do things like this to talk to people like you and I try to be brave, so I could tell his story. But, in the next moment, I'm a -- I'm a wreck and so is my wife. It's horrible.

CUOMO: It's -- look, it's to be -- it's to be expected.

J. CASTILLO: That's all we could say.

CUOMO: It's to be expected.

Are you able yet at all to appreciate that while your son is gone, the test of parenting of what you put inside that kid has been borne out in a way that most of us never know about our kids or about ourselves in a moment that was about him choosing whether or not to be for himself or to be for others, he chose being there for others even though he had to know what situation he was putting himself in?

What does that mean to you as somebody who was teaching values and teaching what he was about in faith and how to live your life?

J. CASTILLO: It's everything to me. You know, it's everything to me that -- and, you know, let me just say this.

When -- when you're raising a child and you're all in and in and you're loving him and you spend every moment with them, you're a loving mother, like my wife, cooking food and working a hard job to give them whatever they want.

And -- and, you know, it's not just the material things but the attention and creating their favorite dish when they want it, you know, it almost becomes natural that you don't even realize that you're creating such an incredible person, as my son.

And, as I've been telling people today, as I've met, you know, it's community, it's his faith in religion. He's been a catalyst in the schools that he has been in where, you know, it's allowed us to be part of other people's families and the faculty in these schools and I just can't say that enough.

I mean there's no doubt in my mind that he leaped into action because of all of those things. He knew that he had to protect people he loved, you know and didn't surprise me or my wife.

CUOMO: And I just wanted to say while I thank you for talking, you're sitting next to your wife.


CUOMO: I'm not ignoring Maria. I know that this is too hard for her to talk about and that you are the appointed spokesperson for the couple.


J. CASTILLO: That is correct.


J. CASTILLO: My wife is, you know, I was all-in with my son, just like my wife. But, you know, Mother's Day is coming up and a mother has a special bond with her son. And I'm here to tell you, you know, we had friends over of my son's, earlier.

Our house is an open door. You know, we don't lock the door, keep his friends out there and wait for them to, you know, come in. I mean they -- they rush in and she feeds them and that's the kind of community that we have.

And her hurt is so deep because, you know, she gives everything to these kids. You know, there comes a time in your life when, you know, things that are personal for us, you know, a beautiful woman buying something for herself becomes less important and she gives it up for her child.

And -- and that's my wife, you know.

CUOMO: Well--

J. CASTILLO: And that's -- that's what I love about her.

CUOMO: --you're an example of everything that parents hope to be. And I hope you remember that. While what happened to your family is so unfair, you did your job, Mom and Dad.

You put somebody in this world that put others before them self and they didn't do it with their mouth. They did it in a time of crisis in a way that saved lives even if it cost their own. And there is no higher calling of integrity and service than that. So, thank you for your own community.

J. CASTILLO: Yes. You're right.

CUOMO: And thank you for talking to me about it.

J. CASTILLO: Thank you.

M. CASTILLO: Thank you.

J. CASTILLO: And thank you for giving me the platform to celebrate my son. You know, these lights will go out. Things will go away. But --


J. CASTILLO: -- I never want to forget him, so thank you.

CUOMO: He should not be forgotten. And parents like me hope that the kids that I'm raising have a little bit in them of what your son was all about. So God bless.

J. CASTILLO: Thank you.

CUOMO: And the best for you in coping with the pain that is with you now. And I know it's not going to go any way anytime soon. So, God bless going forward.

J. CASTILLO: Thank you.

M. CASTILLO: Thank you.


ALLEN: I don't know how they were able to do that interview. But again, Kendrick Castillo, that is his name, and he will always be remembered.

HOWELL: Put himself in the line to protect others.

We'll be back after this.




ALLEN: Welcome back.

The French military has carried out a daring rescue in Burkina Faso with the help of U.S. intelligence. They freed four hostages, two French men, an American woman and a South Korean woman.

HOWELL: Two French soldiers were killed during the raid. CNN's Melissa Bell has this story.


MELISSA BELL, CNN CORRESPONDENT: Tributes have been pouring in to the French servicemen and women involved in the overnight rescue in northern Burkina Faso that allowed for the rescue of four Western hostages, two French citizens, who have been missing since May 1st, when they vanished during a trip to a nature reserve in Benin. Two teachers vanished from that trip and had been actively being searched for. They were located thanks to help partly from American intelligence.

Although the American military weren't directly involved in the operation, that intelligence was crucial. What the French involved in the operation had not anticipated when they got to the camp where the hostages were being held was that two others would be in the group, one American and one South Korean, who have also been rescued.


BELL: We understand from French press reports that the group of hostage takers was believed to have been on its way to Mali, a country famous for the number of terror networks that operate there. Some are affiliated to Al Qaeda and others to the Islamic State.

On Saturday, President Emmanuel Macron will be on the outskirts of Paris to welcome home three of the hostages, the two French citizens and the South Korean citizen. We know less about when the American former hostage will be heading home.

We know less, also, about the hostages' identities. Sadly, of course, in that operation, two French Marines lost their lives. The French authorities say it was an operation that was incredibly complex -- Melissa Bell, CNN, Paris.


HOWELL: Melissa, thank you.

Now to the torrential rain that is battering Texas. More than 20 million people in three states are under a flash flood watch and more than 64,000 customers have lost power so far.

ALLEN: Severe weather started drenching Houston earlier this week and take a look at this, as floodwaters nearly sent this manhole cover flying. That shows you how much water they have got.


ALLEN: OK. Colonies on Mars and the Moon. They would have been pure science fiction just a few years ago but ambitious billionaires hope to make them a reality. We'll have that next.






ALLEN: It is the final frontier and the billionaire space race to capitalize is on.


JEFF BEZOS, AMAZON FOUNDER: It is time to go back to the moon, this time to stay.

ALLEN (voice-over): There you go. You can move there. Amazon founder Jeff Bezos unveiling his plans to build a base on the moon. His space company, Blue Origin, has quietly been designing and testing rocket technologies for two decades. He has been a busy entrepreneur.

Then there is British entrepreneur Richard Branson.



RICHARD BRANSON, CHAIRMAN, VIRGIN AMERICA: It is tremendous what Jeff and his team are doing. And, yes, incredibly exciting. I think the exciting thing for the world now is that you have Jeff, you have Elon, you have ourselves, creating, you know, different approaches to take people into space, to colonize places like the moon, in future years. So an incredible new era of space exploration has arrived.


HOWELL: Branson's tourism venture, Virgin Galactic, could be open for business soon, operating private flights to outer space. After 15 years, that company is now testing missions. Hundreds of customers have already signed up, paying up to $250,000 for the high speed trip to space.

Billionaire Elon musk has always been open about his space ambitions, touting bold plans for colonizing Mars. His company, SpaceX, has created reusable rockets that regularly haul satellites into orbit. And it also has high profile contracts with NASA and the U.S. military.

ALLEN: All very cool. I'd go to the moon but I don't have $250,000. I wonder if you could use miles.

HOWELL: You know, we'll have to check.


HOWELL: In Australia, a campaign event for the prime minister was interrupted by a bad egg in the crowd.

ALLEN: That is not a metaphor this time. Here is CNN's Jeanne Moos.


JEANNE MOOS, CNN CORRESPONDENT: When a protester threw an egg at Australia's prime minister, the prime minister exhibited a hard-boiled head. And it just grazed him, though he did have to help up a woman who got knocked to the ground and the egg thrower got knocked verbally as she was led out.

It's the second egging in as many months in Australia.

UNIDENTIFIED MALE: When people are getting attacked in their own --

MOOS: This right wing senator, egged by a teen, fought back. The preferred reaction in the U.S. is playing it cool.

Like George W. Bush did, ducking a pair of shoes.

GEORGE W. BUSH, FORMER UNITED STATES PRESIDENT: So one of the guys threw a shoe at me.

MOOS: The same thing happened to Hillary.

HILLARY CLINTON, FORMER SECRETARY OF STATE: -- cycling about -- what was that about?

Thank goodness she didn't play softball like I did.

MOOS: Someone with similarly bad aim...

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I mean, you have Hillary who is a disaster.

MOOS: -- hurled a tomato at then candidate Trump, who waved and smiled. But it's hard to smile through a pie in the face. Anita Bryant campaigned against gays and then got pied by one.

UNIDENTIFIED FEMALE: Well, at least it's a fruit pie.

MOOS: While right-wing commentator Anne Coulter got pied by two.

When a protester hit Rupert Murdock with a foam-filled pie, Murdock's then wife Wendy in pink whacked the attacker.

And when Ralph Nader was pied, he served it right back. The shoe was on the other foot.

This minor league manager took care not to throw his shoe at the ump. Instead he raised an armpit in protest, you stink -- Jeanne Moos, CNN, New York.


ALLEN: We continue right after this.