Return to Transcripts main page


U.S.-China Trade War; North Korea Waiting for Trump to Blink or Leave Office; White House Asked McGahn to Say Trump Didn't Obstruct Justice; House Committee Issues Subpoenas for Trump's Taxes; Children at War; Cities Coping with Ransomware Attacks; Warriors Beat Rockets. Aired 5-6a ET

Aired May 11, 2019 - 05:00   ET




NATALIE ALLEN, CNN ANCHOR (voice-over): A trade war is brewing. U.S. president Trump threatens China with more tariffs after talks between Beijing and Washington stall.

GEORGE HOWELL, CNN ANCHOR (voice-over): Plus, House Democrats subpoena the Treasury Secretary for President Trump's tax returns, escalating the battle for information about the Trump administration.

ALLEN (voice-over): Also this hour, thousands of people without power and it could get worse. You're looking at severe weather and flooding, battering the south central U.S. Derek will have the forecast.

HOWELL (voice-over): Looking at that reminds me of Hurricane Harvey. So bad there.

A warm welcome to viewers here in the United States and around the world. I'm George Howell.

ALLEN (voice-over): I'm Natalie Allen. CNN NEWSROOM starts right now.


ALLEN: Our top story, U.S. president Donald Trump dealing with trouble in at least three points around the world with no indication of what is coming next.

HOWELL: First in China, which now faces tariffs of 25 percent on imports to the United States. This after trade talks break down and no word when those talks will resume.

ALLEN: In the Middle East, the U.S. has deployed additional firepower, the U.S. calling it a deterrent to Iran. A military carrier group is already in the area.

HOWELL: And also the issue of North Korea, Mr. Trump, downplaying recent short-range missile launches. The diplomatic efforts are at a standstill. But the president says he is still open to talks. CNN has reporters covering all angles of this story.

ALLEN: Our Matt Rivers is in China. Ben Wedeman is in Beirut, following the U.S. missile system deployment. And Anna Coren is in Hong Kong for the latest on North Korea.

HOWELL: Let's go to Matt Rivers.

It comes down to exactly how China will retaliate and when, at this point.

MATT RIVERS, CNN CORRESPONDENT: Yes, the when, it's not an if question, you're right, George. It's when. China says they're going to retaliate. They've done it before when the U.S. has hiked tariffs on Chinese imports to the U.S. So we're just waiting word from the commerce ministry as to exactly how China's going to retaliate.

I would expect that information is going to come out relatively quickly, either this weekend or on Monday. But that's what we're waiting for.

In terms of how China can retaliate, there's a number of different ways you can do it. Interestingly, because of this trade war, most American imports to China are already under tariffs. So when America sends goods here, Chinese importers have to pay a tax. That's the initial retaliation that China first did.

But what we could see China to is increase those tariff rates like what the U.S. just did on Friday. We could also see them restrict market access for American companies. And interestingly, they could resume restrictions on Chinese buyers buying American soybeans. It may seem obscure, but Americans sell billions of dollars of that crop to China each year. That had been a casualty of the trade war. There were restrictions put on last year then China lifted those restrictions.

But they could easily come back up again. That's where we're at, George and Natalie. We're not exactly sure how China is going to retaliate. We know they will; it's just a question of mad.

HOWELL: Matt, we hear from the United States president, saying the U.S. is negotiating from a place of strength.

There in China, what is the word from Xi Jinping about the nation's economy and how they will endure in the long term?

RIVERS: If you believe what the White House is saying, that it was China walked back on an agreement, that's how it came back from where it was looking like a deal to where we are now, China would deny that.

But if you believe what the White House is saying, look, China knew what they were doing when they got into that. It knew that the United States was not going to be happy and that this was a possibility.

So I think in the halls of power in Beijing, you, at least, can infer a sense of relative position of strength, in terms of they're looking at the economy here and saying we're resilient. We can get through this. That's the line you're see in state media. Trying to drum up nationalistic support against the Americans in this trade war.

Now whether that's true, economists really have a wide range of opinions on this. I think the general feeling is that China's economy might not last as long as the American economy could, in terms of being OK during a trade war. There's really a whole bunch of opinions. But looking at China's actions, you're seeing --


RIVERS: -- at least for now, Beijing thinks they can weather this.

HOWELL: Matt Rivers following the story, Matt, thank you.

ALLEN: There is another growing dispute involving the U.S. This one with Iran. The Pentagon saying it has deployed more Patriot missiles to the Middle East in order to deter potential attacks by Iran or its allies.

HOWELL: This comes days after the U.S. decides to send a carrier strike group to the region. Still, the U.S. insists it doesn't want war. It also gave Switzerland a phone number that Iran can use to call President Trump.

ALLEN: We'll see if they make that call. Let's talk about the standoff with CNN's Ben Wedeman, live this hour in Beirut.

The United States seems to take these threats very seriously. The question is, how and why Iran is making these reported threats, Ben?

BEN WEDEMAN, CNN SR. INTERNATIONAL CORRESPONDENT: Well, I think the fog of prewar, Natalie and George, is very thick at the moment. For instance, the deployment of this -- the Abraham Lincoln carrier group. It wasn't decided a few days ago. It was decided months ago.

It was announced a month ago that it would be deployed to the Middle East. It was only late on Sunday night that U.S. national security adviser John Bolton announced it was because of unspecified Iranian threats.

What we're hearing is a lot of intelligence or so-called intelligence from unnamed sources. But there's nothing much solid you can put your hands on at the moment, somewhat reminiscent of the leadup to the 2003 war against Iraq. We all know how that happened.

Now the latest moves by the United States is that it's announced it's going to be deploying one Patriot anti-missile battery in the region. But just a few months ago, it withdrew four such batteries as the war against ISIS was winding down.

They're also going to be deploying the USMC Armament, which is an amphibious vessel that delivers Marines and military vehicles. That, in fact, was also planned to be deployed in the region. Its deployment, however, has been accelerated.

So certainly, we see the moves from elements within the U.S. administration certainly heading toward an escalation. But we've also heard President Trump said the Iranians should give him

a call, because all he wants is for the Iranian nuclear program to come to an end, which is exactly what the 2015 Iran nuclear deal was designed to do, at least until the year 2030.

Now President Trump doesn't seem to be on the same page as Mr. Bolton, who has long been a proponent of regime change in Iraq. He -- rather, President Trump -- saying that he wants the nuclear program to end.

Bolton, obviously, has a much broader program or agenda. He wants to see an end to the regime itself in Tehran. So confusion reigns but definitely, the fog is very thick.

ALLEN: Absolutely. Yes, relations between the two countries have been deteriorating ever since President Trump withdrew from that nuclear deal. Ben Wedeman for us in Beirut. Thank you, Ben.

HOWELL: So again in the face of all of these different crises that are playing out, the U.S. president is downplaying North Korea's latest missile tests.

ALLEN: On Friday, President Trump told "Politico" that he did not consider the short-range missile launch Thursday to be a breach of trust by North Korea's leader. He called it, quote, "very standard stuff." And the U.S. special representative for North Korea says the door for talks is still open.

HOWELL: Let's go live to Hong Kong. Our Anna Coren has been following the story.

Anna, it doesn't feel like the response from both sides has been measured for this relationship.

ANNA COREN, CNN CORRESPONDENT (voice-over): That's right. Because there's so much at stake. Not only are we talking about the difference between peace and war on the Korean Peninsula, I should say, but we're also talking about a U.S. president who wants to have that foreign policy accomplishment.

He wants to be the U.S. president to denuclearize the Korean Peninsula and bring about peace.

We have to remember when those two leaders, Kim Jong-un and President Trump, met in Singapore last year and that bromance that flourished, shortly after that, President Trump said there was no longer a threat from North Korea.

Well, since then, we've seen a deterioration in that bromance, although, as you say, they're keeping things quite measured.


COREN: But North Korea is, without a doubt, testing America. It desperately wants its attention. It wants to return to the negotiating table. It wants those sanctions lifted. But the United States, under this administration, Trump is saying that

North Korea denuclearize before those sanctions are lifted. So as we say, George, there's so much at stake. But there's a lot of face to save as well.

As you mentioned, you know, Trump has many foreign policy issues happening all over the world. And he is stretched. He does not want to see this unravel on the Korean Peninsula, what he has worked so hard to achieve.

But it is a big gamble. For all we know, these short-range missile tests could soon become long-range missile tests. And that will certainly get up the nose of the United States because those are what they are most concerned about.

As for now, Donald Trump says the relationship remains. Nobody is happy about what is taking place. But North Korea clearly isn't ready for the talks. And that would suggest that the United States is not prepared to go into the negotiating table with North Korea anytime soon, George.

HOWELL: Anna Coren, thank you.

ALLEN: And that, of course, is the global front. But the president certainly faces much on the domestic front. The U.S. attorney general seems to think Donald Trump did not obstruct justice.

So why won't the former White House counsel, that you see here, say that?

We'll talk about that story coming up here.

HOWELL: Speaking of denied requests, it looks like the U.S. Congress won't get a look at Mr. Trump's taxes anytime soon. We'll take a look at how they're trying to change that.




HOWELL: Welcome back. We have new details about the Trump administration's efforts to control the fallout from the Mueller report.

ALLEN: Sources say that the White House asked former White House counsel Don McGahn to say that Trump did not obstruct justice. And McGahn refused. And as you can imagine, 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 McGahn had obstructed justice. But McGahn and his lawyer didn't believe --

[05:15:00] HOWELL: -- a statement was necessary since the attorney general William Barr had already come out and said Trump didn't obstruct justice.

ALLEN: Meanwhile, Democrats in the U.S. House have subpoenaed the U.S. Treasury Secretary and the nation's tax commissioner to turn over the tax returns.

HOWELL: Earlier this week, Treasury Secretary Steven Mnuchin refused to turn over six years of returns as the House had requested. He had said there was no legitimate legislative purpose for it. They have until next Friday to comply.

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

ALLEN: Yes, Rudy Giuliani had planned to push Ukraine to investigate Democratic presidential candidate Joe Biden and look into Biden's call in 2016 to have a Ukrainian prosecutor removed. That prosecutor had investigated a natural gas company connected to Biden's son. But late Friday night, Giuliani called off the trip.


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; 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.


ALLEN: We should point out it is not clear who Giuliani was talking about there. But the Mueller report could be on the agenda in Moscow next week.

HOWELL: That's where the secretary of state Mike Pompeo meets with Russian president Vladimir Putin. The State Department says their upcoming discussions will be frank and candid. Our Pamela Brown has the story.


PAMELA BROWN, CNN SENIOR WHITE HOUSE CORRESPONDENT (voice-over): President Trump, dispatching Secretary of State Mike Pompeo to Russia next week to meet with Russian President Vladimir Putin for the first time since the release of the Mueller report.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: You know, I haven't heard the word Russia in a long time. There's no more talk about Russia. What happened to Russia? The Russian witch-hunt. BROWN: Pompeo and Putin's meeting comes just days after President Trump held an hour-long phone conversation with Putin, where the two leaders talked about several issues, except one, election interference.

TRUMP: We didn't discuss that. Really, we didn't discuss it.

BROWN: All of this as the battle over special counsel Robert Mueller's potential testimony before Congress heats up.

REP. ADAM SCHIFF (D-CA): Mueller is going to testify. He's going to have to testify. It's just a question of how long they can stall.

BROWN: Today, House Judiciary Chairman Jerry Nadler telling CNN Mueller won't testify next week, as the committee had originally planned.

UNIDENTIFIED MALE: What about Bob Mueller? Should he be allowed to testify before the Senate?

WILLIAM BARR, U.S. ATTORNEY GENERAL: I have already said publicly I have no objection.

BROWN: As negotiations continue for Mueller to testify, President Trump once again saying it's up to Attorney General Bill Barr, after he recently tweeted Mueller shouldn't testify.

TRUMP: Well, I'm going to leave that up to our very great attorney general and he will make a decision on that.

BROWN: CNN has also learned today House Democrats are considering voting on multiple contempt citations in a single package, which could include Attorney General Bill Barr and former White House counsel Don McGahn, who was subpoenaed again by Nadler's committee.

REP. JERRY NADLER (D-NY), CHAIRMAN, HOUSE JUDICIARY COMMITTEE: If we have to, we will hold him in contempt, if he doesn't obey a subpoena. I assume he will obey a subpoena.

BROWN: Nadler says that his committee has been negotiating with Robert Mueller as well as the Department of Justice to nail down a date for Mueller to testify. But one thing we know, according to Nadler, it won't happen next week -- Pamela Brown, CNN, the White House.


ALLEN: Let's talk with Leslie Vinjamuri in London, head of the U.S. and Americas Programme at Chatham House think thank.

Leslie, good to see you.


ALLEN: Let's begin with that word contempt. That's something that we've been hearing about in Washington. The congressional committee keeps pushing for information. The White House pushes back.

It's clear that the U.S. -- many are saying it's in the midst of a historic fight over the system of checks and balances. Democratic leaders call it a constitutional crisis.

Do you think we're there?

LESLIE VINJAMURI, SOAS, UNIVERSITY OF LONDON: Well, there's very clearly a serious concern and a very legitimate concern by the Democrats in the House of Republicans, on the various committees, as to whether or not they can actually exercise their obligation of oversight.

And the president is -- by everything that we're seeing -- suggests that he's not complying with that, certainly at the level of norms, right?

The efforts to impede and to block that on any number of dimensions create a very serious problem. The question here, of course, is what are the Democrats doing. The question of what the public thinks of this, I think, is very central to that calculation. The recent poll from Reuters suggests that 57 percent of Americans feel that ongoing investigations will get in the way --


VINJAMURI: -- of the ability of the government, of the president, of Congress, to pursue business that's central to the concerns of the American people.

So it's a very tricky calculation as to how to deal with what is clearly a grave difficulty for Congress in fulfilling its obligations under the Constitution.

ALLEN: Right, right. If the White House, though, keeps the congressional committee from its oversight, is that an impeachable offense, do you think, for President Trump?

VINJAMURI: It's -- just again, it goes back to this question that's a political calculation that the Democrats have to make as to whether or not any number of things are legitimate and meet that criteria to begin impeachment proceedings.

Contempt, when it comes to, you know, not responding to subpoenas, is certainly a concern. But it goes back, again, to this question of whether or not Congress can fulfill its constitutional obligation to exercise oversight.

And there's also a, you know, secondary question, which is to what extent is Congress -- now has to consider the question of whether or not we accept a new way of -- normalizing a new type of behavior. So it's a very tricky political calculation. The country is very divided. And Congress is very divided. So it risks incredible partisan backlash.

ALLEN: Well, the impeachment question, of course, keeps coming up for Democrats. Nancy Pelosi is against it. But Democrats now move in that direction. I want to talk to you about the presidential race coming up.

People, of course, candidates, already on the campaign trail.

Would that complicate strategy for Democrats vis-a-vis the presidential race, if they went down the impeachment

VINJAMURI: Absolutely, go back to what I just mentioned: 57 percent of Americans are suggesting that investigations get in the way of America pursuing a positive agenda, whether it's the government, whether it's Democrats; 45 percent of Americans actually have indicated that they think impeachment is legitimate at this point.

But the optics, if Democratic candidates can't get together and are very clear, articulate a very clear set of policy proposals and a positive vision for America and if the attention focuses and if the sense is that the Democrats are focused on impeachment, rather than pulling America and pushing it forward and driving it forward in a positive way, it becomes very destructive.

So I think Nancy Pelosi has all the right instincts on this. Nonetheless, the Democrats are in a very difficult position because to ignore their constitutional obligation to exercise oversight and to take very seriously things like the Mueller report and the question of obstruction of justice, would also be a violation of their duties as elected officials.

ALLEN: Right. As you say, it's partisan. Republicans keep saying, let it go. The former attorney general, Jeff Sessions, reduced it, when asked in an interview, to just a squabble going on. Democrats would probably take issue at that word.

But is there any merit to the White House, to President Trump, choosing to stonewall on every issue, including the release of his tax returns?

VINJAMURI: There's certainly no merit for the better good of the country. You know, there's a tactical question for the president as to whether or not the tactics that he's using help to solidify a base, which, quite frankly, has been solid for most of his presidency.

And then there's a second tactical question as to whether it does delay those investigations going forward. And then again, it puts the Democrats in a very tricky position of having to decide whether to move forward with contempt, which, again, could trigger a backlash for many of those people that they're seeking to pull on to their side as we move into a primary and an election.

So it's a set of very tricky calculations. But I think it comes to this very important point of how do we decide about where the country should go.

Is it through elections?

Is it through congressional oversight? Is it through impeachment?

Those are very different mechanisms for the public and the government to exercise its voice. And which mechanism we use will have great implications, certainly for Democrats.

ALLEN: We thank you for your insight, thanks so much, Leslie.

VINJAMURI: Thank you.

HOWELL: President Trump likes to brag that --


HOWELL: -- he has a great relationship with the leader of China. Here's the thing, though. It hasn't stopped those two countries from getting into a trade dispute. We'll look at how this started.

ALLEN: Also ahead, parts of the U.S. state of Texas under water. And Derek tells us more rain is expected. Look at that water. Coming up on CNN NEWSROOM.




HOWELL: Welcome back to viewers here in the United States and around the world. You're watching CNN NEWSROOM. I'm George Howell.

ALLEN: I'm Natalie Allen. Thanks for staying with us. Here are the headlines.



HOWELL: A trade war seems to be looming with China, sailing now into uncharted waters. The Trump administration now wants to levy duties on just about everything that comes into the United States with the label made in China.

ALLEN: And that's just about everything in the United States, of course, these days. This comes after trade talks in Washington broke off Friday without an agreement. A 25 percent U.S. tariff was slapped on $200 billion of Chinese imports.

HOWELL: This timeline shows you just how contentious the issue has been. Beginning in March of last year, when President Trump first hit Chinese steel imports with tariffs.

ALLEN: You can see back and forth of talks and tariffs continued into December, when the two sides declared a 90-day truce. That deadline expired. And now there is still no deal and no one can predict how this will end. (BEGIN VIDEOTAPE)

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 --


HOWELL: -- 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 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: Torrential rain is battering the state of Texas. More than 20 million people in three states, actually, are under a flash flood watch. And more than 64,000 customers have lost power.

HOWELL: Severe weather has been hitting Houston, Texas, very hard earlier this week. Just take a look at this. The flooding caused this to happen. The manhole, make that cover fly.



HOWELL: Seen as a win for the rights for children, a militia group in Nigeria releases hundreds of child soldiers. But other groups in that country are still using them.



(MUSIC PLAYING) ALLEN: The United Nations says Yemen's Houthi rebel group are due to

leave three key ports starting Saturday. This is a first step in a U.N. brokered agreement between the Houthis and the Yemeni government that could pave the way for political negotiations after years of war.

HOWELL: The ports include Hudaydah, which is the country's main port, and two others used for grain and oil shipments. The country's four- year war has crippled the economy there and has sparked what the United Nations has called the worst humanitarian crisis.

A Nigerian militia has released almost 900 children who were being used as soldiers in the fight against extremists. And here's some of those children at a ceremony with UNICEF officials. They were recruited to fight against the terror group, Boko Haram, which also recruits child soldiers.

ALLEN: In northeastern Nigeria where this happened, children have been used in conflict for years. CNN's David McKenzie has more about it from Johannesburg.


DAVID MCKENZIE, CNN CORRESPONDENT: It's seen as a major victory for child rights in Nigeria.


MCKENZIE: Almost 900 child soldiers have been released by the Civilian Joint Task Force in the Northeast of the country. More than 100 of them were girls; the youngest of them, 13 years old. No chance of a real childhood.

They were taken by the communities by this group that is fighting against ISIS and Boko Haram, credited with some success against that terror group. But the use of child soldiers seen as a major stain on both them and the Nigerian military, with whom they work closely.

Now Boko Haram is seen as the worst offender when it comes to child rights. They've kidnapped thousands of young girls and boys, sending the boys out to fight and sent the girls into forced marriages.

Most disturbingly, they send children out as suicide bombers to attack communities. But this move by this group that already said they would do it in 2017, is seen as a positive one. UNICEF says maybe they can get some form of normal live; they will be going back to school, these young girls and boys, and soon hope to be reunited with their families -- David McKenzie, CNN, Johannesburg.


ALLEN: We'll continue to cover that if they are.

Coming up here, no Kevin Durant, no problem. The Golden State Warriors advance to the next round of the NBA playoffs with one of their top players out with an injury. We'll have the highlights.





HOWELL: Welcome back to CNN NEWSROOM.

Many U.S. cities are finding themselves the victims of a new kind of threat. Their computer systems and their data held hostage by ransomware attacks.

ALLEN: So far this year there have been 22 known cases of this kind in the U.S. and experts say the problem will get worse before it gets better. Here's CNN's Alex Marquardt.


ALEX MARQUARDT, CNN CORRESPONDENT (voice-over): Tonight, the city of Baltimore is under an extensive cyber attack. Hackers launching an aggressive virus called RobinHood and holding many government computers hostage. The assault causing police e-mails to go down, as do the board of elections. The finance department couldn't do business this week. Fax machines and printers were on the fritz.

MAYOR JACK YOUNG (D), BALTIMORE: We know that the teams are working hard. And we do know that they are not in control of certain parts of our system.

It's really frustrating. And this could happen anywhere.

MARQUARDT: And it does. A new report shared exclusively with CNN by Recorded Future is one of the first to measure the scope of these kinds of attacks, showing that across the country, ransomware attacks are on the rise, crippling counties, cities and towns, costing them millions of dollars.

Since 2013, malicious foreign actors have been detected targeting local governments, law enforcement and universities 169 times, 22 attacks alone this year, figures the group behind the new study says which represent the tip of an iceberg.

ALLAN LISKA, THREAT INTELLIGENCE ANALYST, RECORDED FUTURE: The bad guys see state and local governments as a target that is willing to pay and that they may be able to get a lot of money out of. If nothing else, they may be able to get a lot of news coverage out of.

MARQUARDT: The attackers are not governments. This isn't about politics but money. Attacking targets big and small underfunded when it comes to cyber security.

LISKA: They've got a bunch of really dedicated people but they don't have the latest tools and equipment to protect themselves.

MARQUARDT: Eric Wyatt is one of those dedicated people. Last fall, he fought off a multi-prong ransomware attack on his 100,000-person community north of Anchorage, Alaska.

ERIC WYATT, MATANUSKA-SUSITNA BOROUGH IT DIRECTOR: They were so into our network that they brought down the vast majority of our workstations and servers. This type of attack we saw was far worse than anything I have seen in my past, being in this industry for over 35 years.

MARQUARDT: One thousand employees were affected. Old typewriters had to be dusted off. The ransom wasn't paid but it costs $2.5 million to fix the problems which still linger today almost a year later.

WYATT: We're outgunned. We don't have the resources to fight this fight. The people who are attacking us are better organized, better funded. And we don't have the same level of capability that they do. So, they see us as a soft target, often we are.

MARQUARDT: The FBI is among first calls that victims make. They say attackers have moved from targeting individuals to larger prizes because it's more lucrative.


MARQUARDT: The problem the FBI believes is only getting worse.

LAWSON: People are paying the ransom and encouraging the behavior. So, I think we will continue to see an escalation in sophistication of ransomware attacks.

MARQUARDT: The good news is that, according to the study which was obtained exclusively by my colleague, Kevin Collier, just 17 percent of local and state governments actually pay the ransom. Still, we've seen a surge of attacks against them, attackers seeing them as ripe targets because of all the attention they get when governments are taken offline -- Alex Marquardt, CNN, New York.


HOWELL: Alex, thanks, a very important story.

They did it again. The NBA's Golden State Warriors are headed to the Western Conference finals for the fifth straight season.

ALLEN: They eliminated the Houston Rockets on their home court Friday night. The intense back and forth game 6 showdown included solid efforts by the Rockets and 35 points from Houston point guard James Harden. But that was not enough. With just a little help from the Splash Brothers, two-time MVP Steph Curry and Klay Thompson combined for 60 points total and the Warriors' bench came up as well.


KLAY THOMPSON, GOLDEN STATE WARRIORS: Without Kevin, I just knew I had to move a lot without the ball. I had to get to my spots, rise up and shoot. You know, when you're missing one of the greatest players ever played in the best sport in the world -- [05:55:00]

THOMPSON: -- you can't collectively make up for what he does. But can you step up in his absence and help out the point production. And I think everyone else just does a great job. I mean, Shaun Livingston, what a game for him. Kevon Looney, our bench played amazing tonight.

STEPH CURRY, GOLDEN STATE WARRIORS: I knew it was a 48-minute game, there was going to be a moment I could really turn it on. And the second half, i just tried to not pick up a fourth early and then you know, a couple shots go down, start to see the floor a little bit, understand what they're doing differently defensively. And then the floodgates opened.

So this stage, in terms of how this game was, was huge. I've had games like this, maybe not as drastic, It was 0-33, but where things weren't going your way. You start to just figure it out. But I'm glad it obviously happened.


HOWELL: And the NBA superstar LeBron James was watching the showdown and he reacted to the Warriors' victory, tweeting this, "Never underestimate the heart of a champion."

ALLEN: We've got a historical footnote for you, 150 years and still going strong.


ALLEN (voice-over): Yes, back on May 10th, 1869, the Transcontinental Railroad was completed, providing Americans with uninterrupted travel from coast to coast for the first time.

Well, on Friday, the state of Utah marked the moment when a golden spike was tapped into the ground, uniting the Union Pacific and Central Pacific Railroads.

HOWELL: That monumental achievement wouldn't have been possible without immigrant labor, specifically the Chinese. And for the first time, descendants of Chinese workers were included in this year's ceremony.


ALLEN: Well, thank you for watching CNN NEWSROOM. I'm Natalie Allen.

HOWELL: And I'm George Howell. For viewers in the U.S., "NEW DAY" is next. For viewers around the world "ERIN BURNETT OUTFRONT" is ahead.

ALLEN: See you later.