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U.S. on Stand By for China's Tariff Retaliation; Three-Year-Old Boy Taken from Parent's Custody; Tensions in UAE Escalates; U.S. Anticipates China's Tariff Retaliation; Severe Weather Pummeled Northeastern U.S.; Democratic Candidates Running on Reforming Gun Laws; Manchester City Beats Brighton. Aired 3-4a ET

Aired May 13, 2019 - 03:00   ET



GEORGE HOWELL, CNN ANCHOR: Waiting for retaliation as the U.S. slaps heavy tariffs on Chinese products, markets are bracing to see how Beijing will fight back.

ROSEMARY CHURCH, CNN ANCHOR: Plus, suspected acts of sabotage near the United Arab Emirates in the middle of an already tense situation near the Strait of Hormuz. The U.S. steps up its military presence as a warning to Iran.

HOWELL: And the story of a 3-year-old child rescued or was he kidnapped? An American couple say their son was forcibly taken away by officials while police say the boy is finally safe.

Welcome to our viewers here in the United States and all around the world. I'm George Howell.

CHURCH: And I'm Rosemary Church. From CNN headquarters in Atlanta, CNN Newsroom starts right now.

U.S. President Donald Trump may feel confident about how the trade war with China is going, but investors are nervous.

HOWELL: That's right. Asian markets closed in negative territory over the latest hike in U.S. tariffs and Beijing is expected to retaliate. You see here the Nikkei, the Shanghai Composite in Seoul all showing negative -- in negative territory. U.S. futures markets also. A down day on Wall Street as well. You see the same playing out there.

CHURCH: But President Trump tweeted the U.S. is right where we want to be with China. he claimed the U.S. would collect tens of billions of dollars from the tariffs, but his top economic adviser admitted that isn't how it works.


CHRIS WALLACE, FOX NEWS ANCHOR: It's not China that pays tariffs, it's the American importers, the American companies that pay what in effect is a tax increase, and often times passes it on to U.S. consumers. LARRY KUDLOW, WHITE HOUSE ECONOMIC ADVISER: Fair enough. In fact,

both sides will pay. Both sides will pay in these things.


CHURCH: Well, U.S. senators from both parties are expressing concern over the lingering battle.


SEN. MICHAEL BENNET (D-CO): Putting tariffs on our allies, putting tariffs on even the Chinese that are actually taxes on American producers, American farmers, taxes on the American consumer and taxes on the American worker I think are completely the wrong way of doing this, and I can assure you the Chinese have a longer attention span than Donald Trump has.

SEN. RAND PAUL (R-KY): I think there are ways the Chinese market could open up and that would be good, but I would still advise the administration to get this done because the longer we're involved in a tariff battle or a trade war, the better chance there is that we could actually enter into a recession because of it.

SEN. KAMALA HARRIS (D-CA), PRESIDENTIAL CANDIDATE: This president and this administration have failed to understand that we are stronger when we work with our allies on every issue, China included.


CHURCH: So let's go live to Beijing. CNN's Steven Jiang is following this story. He joins us now. So, Steven, everyone is watching to see how China responds to this hike in U.S. tariffs. How are they likely to retaliate? What are their options?

STEVEN JIANG, CNN PRODUCER: Well, Rosemary, they have a few options, they could obviously impose countertariffs on U.S. imports but probably not dollar for dollar because, remember, the Chinese import a lot less from the U.S. than the other way around, so they're literally running out of American products to tax on.

But they could also cancel major purchases from the U.S. especially in the form of agricultural products which could hit hard on the political base of Mr. Trump in the U.S.

They could also create these so-called non-tariff barriers for American companies, for example, favoring non-U.S. entities when granting market access here or even launching unofficial retaliations to make life difficult for American companies here by, for example, delaying the issuance of licenses or customs clearances or even sending fire inspectors. Rosemary?

CHURCH: So where does this leave any effort to fins a solution to this trade war. What about the talks? Are they possible or have they stalled?

JIANG: You know, it's interesting because even with its latest escalation or potential vicious cycle in this trade war, both sides are still saying they want to keep talking.

The vice premier of China who is the top negotiator of the country, has actually emphasized negotiations have not broken down. But given how far apart they remain on key issues and how hardened their stances have become, it's really hard to imagine what they can resolve or achieve in the next round of talks.

But you know, interestingly the state media here has also become more nationalistic in their coverage of this issue. They've been pushing back on American claims on a number of things.

[03:05:01] For example, how can the Chinese walk back from agreements that have never been formalized in the first place, and also they've been trying to turn the table at Washington by calling the Americans being unrealistic in terms of adding the amount of U.S. goods that they expect China to buy at the very last minute.

And another interesting thing to note is of course the Larry Kudlow sound bite you played earlier about basically admitting his boss has been misleading the American public on who has been paying these U.S. tariffs.

The Chinese state media has also picked up these remarks and now they're really using that to highlight the fact that the American -- the U.S. tariffs have been hurting the American people and how there are no winners in this trade war. Rosemary?

CHURCH: Yes, and of course the American consumers are just coming to terms with that as they're starting to realize that is indeed the case. Steven Jiang, bringing us the very latest. We know you will contact us as soon as you get any response from China. Many thanks.

HOWELL: The U.S. secretary of state is cancelling a monday trip to Moscow. Instead, he will meet with European officials in Brussels to talk about pressing matters, including a dispute with Iran.

CHURCH: Before departing, Mike Pompeo reiterated that the U.S. does not want war with iran. Take a listen.


MIKE POMPEO, UNITED STATES SECRETARY OF STATE: We're not going to miscalculate. Our aim is not war. Our aim is a change in the behavior of the Iranian leadership. We hope the Iranian people will get what they finally want, they so richly deserve.

The forces that we're putting in place are forces we've had in the region before. You know we often have carriers in the Persian Gulf, but the president wanted to make sure in the event that something took place we were prepared to respond to it in an appropriate way.

As the secretary of state I want to make sure that we had all the political/diplomatic tools in the right place and we want to make sure that we can provide the president with an option set in the event that the iranians make a bad decision.


CHURCH: Now Mr. Pompeo's trip comes as four commercial vessels were targeted in the Middle East off the coast of the United Arab emirates. The U.S. has warned that Iran could be targeting vessels in the area, but Iran's foreign ministry is calling the incidents alarming and regrettable.

HOWELL: There is a lot to talk about. Let's do so now with CNN business' emerging markets editor John Defterios. John joining this hour live from Abu Dhabi. Good to have you, John. So, what was a big reference to attack on commercial vessels on Sunday now it seems to have more clarity from Saudi Arabia. John, what more can you tell us?

JOHN DEFTERIOS, CNN EMERGING MARKETS EDITOR: Well, George, it's been described as a sabotage attack near the territorial waters of the UAE, this is south of the Strait of Hormuz. The clarity coming from Saudi Arabia. And I think it's worth noting coming from the very top. This would be the minister of energy, Khalid al-Falih.

This also links the reports that we saw coming out of the UAE over the weekend, suggesting there were four tankers, two of the four now we know that were working on behalf of Saudi Arabia. There were no casualties, according to the minister, or oil spills, but there was significant damage to the structures or the ships themselves.

This is alarming in a sense because this is a vital artery for crude going out to the world. Handling a third of seaborn traffic. There is also a report in the last hour from the Iranian ministry of foreign affairs, a spokesperson, to provide some distance between Iran and the incidents we saw over the weekend.

The spokesman saying the this is a part of adventurism by foreign players and a very worrying signal because of the tensions around the region itself. And actually blamed it on ill wishers trying to create problems here in the Middle East. as the U.S. ramps up its presence in the gulf water with the USS Abraham Lincoln on its way after passing through, of course, the Suez Canal. Patriot missiles being deployed to the region as well. It has significant signs of things we've seen in this region in the past, as you know, George.

HOWELL: These incidents near the port of Fujairah was categorized as a serious development. Why is there so much concern?

DEFTERIOS: You know, George, we bring up that map again you can see that the port of Fujairah sits south of the Strait of Hormuz and at its closest point we have an artery that's only 17 miles wide. But this was designed after the Iran-Iraq war and again, after the Gulf War in the invasion of Kuwait in 1990 in the Gulf War 1991 to avoid tensions around this region.

It's a huge bunkering facility. I've been on the waters many times for my energy coverage. And it can load supercarriers than can carry a million barrels of crude. It has a pipeline going from the Abu Dhabi oil fields into the port Fujairaj which is a UAE Emirate and it's supposed to go straight out to the Gulf of Oman. I think it's a signal by those who have planned it to suggest that

it's not just the Strait of Hormuz you should be worried about, it can expand to the broader waters and those supporting the tensions against Iran.

[03:10:04] And that would be the U.S., of course, putting forward the military hardware, but Saudi Arabia and the UAE specifically who have backed the pressure on Iran because of the nuclear agreement in the past and its said expansionist policies here in the region, particularly in Yemen, Syria and Lebanon, of course.

HOWELL: All right. John Defterios giving us some insight as to what's happening there in the region. John, thank you.

CHURCH: Well, the U.S. president faces yet another critical week in his presidency.

HOWELL: President Trump is not backing down in the face of subpoenas that may end up threatening his administration.

Our Jeremy Diamond has this story.

JEREMY DIAMOND, CNN WHITE HOUSE REPORTER: The battle between the White House and congressional Democrats very much continuing this week. It's been several week since the president vowed to fight all subpoenas issued by House Democrats, and we've seen that strategy play out in the last several weeks, but on Tuesday we're expecting a resolution on at least one of those subpoena requests.

That's because a federal judge is expected to rule on the subpoena from the House oversight committee demanding financial records from one of the president's former accounting firms, and then on Friday that is when House Democrats have laid out a deadline for the Treasury Department and the IRS to respond to their subpoena on the president's tax returns.

That's a demand that the administration has so far resisted. The Treasury Secretary Steve Mnuchin has categorically refused that request just last week. But the White House's position is remaining firm. They are insisting that they are not going to comply with several of these subpoena requests.

The White House deputy press secretary Steve Groves, he issued a statement on Sunday saying there are rules and norms governing congressional oversight of the executive branch and the Democrats simply refuse to abide by them.

This White House will not and cannot comply with unlawful demands made by increasingly unhinged and politically motivated Democrats.

So the White House very much remaining firm in its position on that, but House Democrats, meanwhile, are grappling with how to get the White House to comply with the 20-plus investigations that so far we've seen simply stonewalling from this White House and from the president and his allies. Some Democrats are also now calling this a constitutional crisis

because of that stonewalling from the White House. The president, though, very much pushing back on that. He said in a tweet the Democrats knew and pathetically untrue sound bite is that we are in a constitutional crisis. The president very much rejecting that notion.

Jeremy Diamond, CNN, the White House.

CHURCH: Natasha Lindstaedt is a professor of government at the University of Essex and joins us live from Colchester in England. Good to have you with us.


CHURCH: President Trump is pushing back against congressional Democrats, vowing to fight all subpoenas and the 20-plus investigations, and it is a stalling strategy that's working very well for him. So how do the Democrats get the White House to comply? What are the options available to them?

LINDSTAEDT: Well, unfortunately, the options available to them may end up taking a very long time. As had already been mentioned in the report, there are 20 different investigations and the Washington Post had reported that they had made 79 requests to Trump and he sort of blocked all of them or not complied with any of them.

So if we were just to take one of the requests to get Barr to testify and that they've subpoenaed him, and they voted -- one committee had voted him in contempt. So the entire House could vote him in contempt.

But then they're going to need to get a court order, and that's not so simple because the courts can have appeals and then this can cause delays and more delays and they could really just sort of run out the clock trying to get the courts to step in and actually make a decision about how much legislative power there is and how much executive power there.

CHURCH: Right.

LINDSTAEDT: And so the Democrats have different options, but the problem is that these options may take a long time to come to actual fruition.

CHURCH: Yes, and we heard in that report White House Deputy Press Secretary Steve Groves saying the Democrats are not abiding by the rules governing congressional oversight and calls their demands unlawful and politically motivated. Is he right or is he wrong when it comes to congressional oversight?

LINDSTAEDT: Well, historically Congress has had a lot of oversight. In fact, the courts have ruled in favor of Congress instead of being in favor of the executive. This is really important because we don't want to have an imperial presidency.

We don't want to have a democracy where the president has so much power that he can basically rule by decree and that there is not any oversight, so it's important for the Congress to actually push the president and to use their oversight powers.

They've done this before under Bush, George W. Bush, they've done this under Obama. It may not be what the party that is being investigated actually is in favor of.

[03:15:03] But it's important that the Congress actually asserts itself, asserts this power, because if the courts decide to rule on the side of executive power, this could have really important ramifications for the U.S. democratic system.

CHURCH: And of course, we're seeing a growing number of Democrats insisting that the country is in a constitutional crisis right now. President Trump disagrees. Is the U.S. in a constitutional crisis right now or is that overstating the situation, trying to get people's attention that the country may be moving in that direction, but is it actually in that situation?

LINDSTAEDT: Trump is pushing things to a constitutional crisis. I would agree with that. Because he's really defying conventional norm of transparency. In blocking all of these -- in attempting to block all of these investigations that are taking place and in not complying with requests. He's doing everything he can.

He will refuse to provide his financial records. He is suing or filing lawsuits against banks and accounting firms. He is blocking people from testifying. He's exerting executive privilege not just on a couple of matters but on all matters, and that's really the big difference here.

It is common that a president might push back on a couple of issues, but he is blocking absolutely every single attempt of Congress to get access to anything and that's why we're seeing everything getting pushed to the courts and putting the courts with a very big decision of trying to define congressional power vis-a-vis executive power.

And so I would agree with this idea that we're in a constitutional crisis. We are. We can see it because there are all thee investigations getting that are getting blocked at the same time.

CHURCH: Right. And President Trump is doing it because it's working for him, isn't it? He will just kick the can down the road and then there'll be the presidential election and he may not have to worry about this, certainly for the next few months and maybe more than a year and a half.

So, how likely is it given all of that that just through sheer frustration the Democrats will eventually pursue a remedy through impeachment of the president. And if they do go down that path, who wins and who loses?

LINDSTAEDT: That's a really good question. I think the problem is that the entire U.S. public, if you just look the way the public feels about impeachment, there is not enough support for impeachment at this moment. So there may be those in the Democratic base that are very fired up

that have wanted to probably to impeach the president since he initially took over, and that is being represented by the progressive caucus in the House.

But the more senior members of the House and the Speaker of the House Nancy Pelosi is concerned that if they push for impeachment, even though they're really frustrated and they may have reason to be frustrated, if they push too far that's going to lead to a backlash and they're going to get really punished in 2020 because Republicans don't feel that any of thee investigations are worthy.

They feel this is really just politics. That it's really causing more polarization and that it's a waste of time.

So the Democrats have to be really careful, and that's why they're trying to lay out the case here that there has been a lot of wrongdoings taking place and that's why we see all these different investigations, but they really are going to have to appeal to the American public that what's taking place either needs to be impeachable or that they need to not re-elect him in 2020.

CHURCH: All right. Natasha Lindstaedt, thank you so much for sharing your analysis with us. I appreciate it.

LINDSTAEDT: Thanks for having me.

HOWELL: An American couple with guardianship over a 3-year-old boy say Kenyan police kidnapped him, but some officials say police were simply following the law. That story next.

CHURCH: Plus, it came down to one last game. How Manchester City took the Premier League title in thrilling fashion. We'll have that when we come back.



HOWELL: An American couple in Kenya is desperate for answers about why police took their 3-year-old boy and where he is now.

CHURCH: But Kenyan officials say they rescued the little boy from trafficking. It is a case that's divided opinion in the country.

Robyn Kriel tells the story.

ROBYN KRIEL, CNN CORRESPONDENT: Kenyan police enter an American couple's home in Nairobi and take away their little boy.


DAISY MAZZONCINI, KIANO'S LEGAL GUARDIAN: I had just finished putting him to bed. He had fallen asleep. And I walk out of his room and I see all these people in the living room and I look at Matt's face and I think I just knew something was really wrong. (END VIDEO CLIP)

KRIEL: Kiano who is Kenyan was found in a ditch as a newborn emaciated and sick in a plastic bag along with a twin who later died. Since he was six months old he's lived with Daisy and Matt Mazzoncini.

The couple were named as legal guardian in the children's court of Nairobi in 2017, but they say that plain clothes police showed up at their home and told them that the guardianship order was fraudulent.


MAZZONCINI: I felt they were going to take him, but you now, there was nothing we could do. I mean, at this point there was 13 people, you know, like Matt said, they had literally made a human wall.


KRIEL: The group offered no I.D., no search warrant or court order.


MATT MAZZONCINI, KIANO'S LEGAL GUARDIAN: And I just stood up and started yelling. I was like is that Kiano? And then I just started screaming, you're kidnapping a child right now. You are kidnapping our son.

KRIEL: After Kiano was taken away, the Kenyan police director of criminal investigations tweeted from their verified account.


UNIDENTIFIED MALE: Detectives acting on information, worked around the clock to rescue 3-year-old baby John Kiano alias John Xavier from American citizens Mathew Sean Mazzoncini and Ms. Daisy Louise Wake Mazzoncini who had planned to travel with the baby back to the U.S. Child is well and in safe hands.


KRIEL: The tweet was later deleted. CNN has reached out to Kenyan police for comment but they did not respond. The couple alleges their ordeal started when the orphanage where he lived contested their guardianship in court. The judge ruled in the couple's favor and that's when they say orphanage employees started harassing them.


[03:25:03] D. MAZZONCINI: They would come to the gate of where I was living, where we were living, and you know, wanting to see him. I would get reports of this when I was out. All these people came in a white van. They were blocking the driveway. They refused to leave.

So, I reported that to the police. We actually ended up having to get a restraining order against that home.


KRIEL: When CNN contacted the Mogra Children's Center they hung up on us. The Mazzoncini's applied to take Kiano to the U.S. for medical care for his severe epileptic seizures on the advice of Kenyan doctors. The situation escalated.

Kenya's Child Welfare Society, a semiautonomous government agency, accused them of attempted child trafficking and said the guardianship was fraudulent because they are not Kenyan.


IRENE MUREITHI, CEO, CHILD WELFARE SOCIETY OF KENYA: A Kenyan child cannot be given right now to a noncitizen, and that is law.


MUREITHI: That overrides every other option.


KRIEL: While this is true for adoptions, it's not true for guardianship. Under Kenya's Children Act passed in 2001, guardians are not legally required to be Kenyan or residents.

Kenya's Child Welfare Society says that Kiano is in safe custody but it's been more than a month since he was taken from the Mazzoncini's home, which is the last time they saw him.


D. MAZZONCINI: I just think of him being all alone and not understanding, like, where mom and dad went. And that's really hard. You know, you've been through a lot in his life and, you know, we are the only parents he's ever known.


KRIEL: And the Mazzoncini say they won't rest until their boy is home.

Robyn Kriel, CNN, Nairobi.

HOWELL: We'll be right back after this.


GEORGE HOWELL, CNN ANCHOR: A warm welcome back to our viewers here in the United States and all around the world. You are watching CNN Newsroom live from Atlanta. I'm George Howell.

ROSEMARY CHURCH, CNN ANCHOR: And I'm Rosemary Church. I want to check the headlines for you this hour.

HOWELL: The Gulf Cooperation Council has condemned the targeting of four commercial ships near the United Arab Emirates. The alleged sabotage operations as they're called happened in the port city of Fujairah.

There is no word yet on who is responsible and so far, as we know no one is hurt. The United States has warned that Iran could be targeting vessels in that area, but Iran's foreign ministry is calling the incident, quote, "alarming and regrettable."

CHURCH: At least six people were killed Sunday when gunmen attacked a Catholic Church in central Burkina Faso. State media report a priest is among the dead and the church and other buildings were set on fire. The West African nation has seen a spike in extremist violence by militants linked to Al Qaeda and ISIS.

HOWELL: The U.S. President Donald Trump says the U.S. is, quote, "right where we want to be with China." End quote. The stalled trade talks have investors nervous, jittery about possible retaliation from China. Dow futures point to a down day on Wall Street. Asia markets also closing down.

CHURCH: For more perspective on this, Simon Baptist joins us now from Singapore. He is the chief economist for The Economist Intelligence Unit. Great to have you with us.


CHURCH: So, let's start with the big question everyone's asking, how will China likely retaliate against this hike in U.S. tariffs?

BAPTIST: We already have a pretty good idea about how China is going to retaliate. When these tariffs were first proposed last year, China did draw up a list of countermeasures that they were suggesting they were going to take.

So, I think the most likely outcome is that they will just implement those that have already been planned for, and what is for sure is that China is going to take steps to match what the U.S. is doing.

I mean, unfortunately, for the world in both Xi Jinping and Donald Trump you have leaders who are very strong negotiators and they both have a big issue about keeping face and looking to have won in the negotiation. So just politically there is no way that China can sit back and allow these tariffs to go up without a reaction.

CHURCH: Right. I mean, really, all world leaders feel that way, that they would be pushing back, but President Trump keeps saying the U.S. is collecting tens of billions of dollars in tariffs from China, but it's actually the American consumer who is paying and will be paying for those increased tariffs.

And even Mr. Trump's top economic adviser Larry Kudlow admitted that very point on Sunday. Why is Kudlow breaking from what his boss has been saying on this and why now?

BAPTIST: The impact of tariffs is more complex than either side puts out in their characterization. So, part of the tariffs are paid for by U.S. consumers or U.S. firms who are buying China's imports in the form of higher prices.

But part of it is also paid by the Chinese producers who face higher costs in one of their main markets. And so, there is always a question. It differs product by product depending on the market structure how that tariff pain is split between the end users and then also the producers.

And there's also some people who benefit, which are mainly the producers from third countries who now have the opportunity to sell into the U.S. at a higher price because the tariffs will push the price level in the U.S. up, but producers from countries apart from China are not going to have to pay that tariff but they'll get the benefit of whatever the amount of the tariff that is passed through on final prices.

So, it's very complicated and that's why you see very different lobbying stances by different sectors.

CHURCH: Right. And President Trump insists the U.S. is right where it wants to be with China. What do you think he means by that and could this strategy backfire on Mr. Trump once U.S. consumers do figure out that they're the ones paying for the majority of these increased tariffs?

BAPTIST: I think both the U.S. and China have made some tactical mistakes through this process and they've both allowed it to escalate to a place where neither of them wanted it to get to.

The U.S. economy is already suffering somewhat because of these tariffs. Now, there is quite a strong economic situation apart from that in the U.S. at the moment, so that is kind of covering some of the negative impact, but certainly, for example, agricultural industries and also aerospace have particularly been affected by these tariffs that are going on.

[03:34:58] So, I think we can expect to see some impact on U.S. prices. Probably not enough to make the fed say raise -- to turn around and start raising interest rates to try and start to throttle inflation down.

CHURCH: Right. So where do you expect this trade war between the U.S. and China will go next? We've heard chatter about President Trump and the Chinese president getting together next month.

How likely is that and what's their starting point and where will they go with this and what about the ongoing talks? Have they stalled or do you think there's an off-ramp here?

BAPTIST: I think we're going to be talking about this for a long, long time to come. I don't see any prospect in the next six months, really, of a kind of a deal that we might think is final and that is not going to continue to be renegotiated.

I think we can expect to see trade tensions and in fact more importantly tensions around investment and technology to be a permanent fixture of the U.S.-China relationship going forward, and the trade issue is going to flare up and down.

In the moment we're right in the thick of negotiations, so in some ways I don't take anything that either side says right now too seriously because everything at this stage is part of a negotiating tactic, you know, maybe a threat, maybe a compromise. All designed to try to push the ultimate outcome into somewhere a bit more favorable for whichever party is doing the threats at the time.

China certainly team seemed to a bit of a harsher stance or a more hardcore stance towards negotiations last week. The Trump administration had a very strong reaction to that and we've had this period of escalation.

I think we may well see these tariffs implemented. I think it's very possible. It's also feasible that we could see some agreement that would take them back. But I don't think they'll go away. So even if we reach an agreement now, I think we stay at 10 percent and certainly not back to the zero that we had in 2017.

CHURCH: All right. We will watch to see what happens next to see how China responds. Whether it retaliates and how. Simon Baptist, thank you so much for your analysis. I appreciate it.

BAPTIST: Thank you.

HOWELL: Well, the tariffs' impact on consumers is easy to spot at one business in New York City.

CHURCH: Yes, prices rose after the first round of tariffs last year. And Polo Sandoval reports another increase is on the horizon.

POLO SANDOVAL, CNN CORRESPONDENT: Step inside Ryan Zagata's New York City show room and you'll see the unintended consequences of a trade war.


RYAN ZAGATA, OWNER, BROOKLYN BICYCLE COMPANY: With these new tariffs we have to increase the price on this model.

SANDOVAL: Like many of America's small to medium sized businesses, the Brooklyn Bicycle Company is already dealing with the burden of increased Chinese import tariffs. These bikes are assembled in China using foreign made components to keep the costs down for the consumer.

In September the Trump administration's 10 percent tariff hike on nearly $200 billion in Chinese goods forced Zagata to raise some prices.


ZAGATA: This has been one of our most popular bicycles. It was a 449- bike last summer. It's now 499.

(END VIDEO CLIP) SANDOVAL: Then on Friday the White House announced that 10 percent

will increase to 25 percent. A change that will result in yet another price hike on the show room floor.


ZAGATA: For every $100 we spend on bicycle; $5.50 we pay in duties. Since September we've been paying extra $10. From now what, $15.50. If this with this additional tariff, now it's another $15. We're talking $30.30 for every bicycle we import on $100, not for every bike. Ever $100 we spend, $30.50. So, on a $200, our cost at the factory is $200, it's $61 that we're weighing in duties to the government.

SANDOVAL: Zagata says that means some of his customers will be paying more for the same bike.

ZAGATA: It's difficult for me. I can't call my customer and say guess what, you're getting a better wheel set, you're getting better grips and this luxurious leather saddle. It's not what you're getting. Effectively that money is going to the government.


SANDOVAL: It's been a rough ride for many business owners since President Trump waged this trade war with China. Zagata blames the uncertainty that comes with trade negotiations.


ZAGATA: It's not difficult for us as a business to decide what to do. We've built financial models that we can punch in these variables regardless of what the scenario is. And the model effectively will spit out this what you need to do.

The challenge with the models now is we're missing one final variable; we don't know what the final duty is going to be with these trade talks still ongoing.


SANDOVAL: There is some optimism from the president who on Friday took to Twitter saying tariffs will make the country, quote, "much stronger. Just sit back and watch." That may be hard to do for some U.S. importers with China vowing to hit back after Friday's tariff hike.


ZAGATA: I think tariffs are a great tool and I applaud the administration for what they're doing, I just think like, six months, nine months in it's becoming very difficult and come on already with these negotiations. Like let's move ahead.

SANDOVAL: Polo Sandoval, CNN, New York.

HOWELL: U.S. Presidential hopefuls are focused again on the problem of school shootings in the United States.

[03:40:03] CHURCH: There have been 15 school shootings in the U.S. so far this year, and that has many candidates campaigning hard on reforming America's gun laws.

CNN's Rebecca Buck looks at their idea.


UNIDENTIFIED FEMALE: I'm afraid that one day I'll go to school and I'll never come out. I'm sorry.




UNIDENTIFIED FEMALE: It's devastating that my 6-year-old had to be taught how to hide and stay quiet in case someone came to her school to shoot people.


BUCK: Both brought to tears by gun violence in America. And looking to 2020 Democratic candidates for answers.


SEN. CORY BOOKER (D-NJ), PRESIDENTIAL CANDIDATE: I am tired of going to funerals where parents are burying their children.


BOOKER: We are going to bring a fight like the NRA has never seen if they're going to defend corporate gun manufacturers more than represent its people.



BUCK: Senator Cory Booker this week laying out a sweeping gun reform plan. A 14-point approach that would expand background checks, close loopholes and ban assault weapons. And just as drivers need a license, Booker thinks gun owners should, too. A process that would require fingerprints, an interview and completion of a gun safety course.


BOOKER: Enough is enough. I will not only lead this fight but we will win this fight.


BUCK: Not long-ago candidates would have shied away from this fight, lest they risk alienating rural voters or incurring the wrath of the NRA. But that's been changing. Now Democrats aren't just talking about gun control.


SEN. KAMALA HARRIS (D-CA), PRESIDENTIAL CANDIDATE: We need reasonable gun safety laws in this country.



BUCK: But putting it front and center.


REP. ERIC SWALWELL (D-CA), PRESIDENTIAL CANDIDATE: I will be the first campaign to make ending gun violence the top priority in my campaign.



BUCK: It's a welcomed change for Kris Brown, president of the gun reform advocacy group Brady.


KRIS BROWN, PRESIDENT, BRADY CAMPAIGN: The new normal absolutely is that presidential candidates on the Democratic side in this particular race actually really thinking thoughtfully about what the right solutions are and laying claim to those solutions.


BUCK: In a recent CNN poll, 65 percent of Democratic voters said it's very important that the Democratic nominee supports executive action for stricter gun laws. Ranking the issue third behind climate change and Medicare for all.

Activists say the mass shooting last year at Marjory Stoneman Douglas high School in Parkland, Florida marked a turning point in the national debate.


BROWN: That ignited something in this country, not just in Parkland, not just in Florida, it sparked a nationwide movement of youth who were active on this issue, who voted on this issue and they still care passionately about this issue and so do their families.


BUCK: Those voters helped sweep Democrats to victory in 2018. Like Lucy McBath who ran on gun reform in suburban Atlanta and won. A blueprint Democrats believe for doing the same at the presidential level.


BOOKER: I'm running for president for many reasons. This is one. That we will get it done. We will get it done.


BUCK: Now, even as this issue is getting more attention from the Democratic field, there is not yet a consensus among the candidates on gun policy. Beto O'Rourke saying he does not fully agree with Booker's plan and that gun licensing may be a step too far.

Rebecca Buck, CNN, Charlotte.

CHURCH: The Southern U.S. is getting a bit of a break after storms pounded and flooded parts of the region. Up next, we will see what weather is on the way. We're back in just a moment.


HOWELL: Heavy rain flooded streets and overflowed rivers in the city of New Orleans on Sunday. Just take a look at that. Parts of the Southeastern United States have been hit hard by these storm systems over the weekend.

CHURCH: And a new storm could be threatening southwest Texas on Monday.

So, let's turn to our meteorologist Pedram Javaheri, keeping a very close eye on this. So Pedram, how's it looking?

PEDRAM JAVAHERI, CNN METEOROLOGIST: You know, at this hour, not too bad. We're expecting more thunderstorms later on this afternoon, guys. And you know, when you look at how many thunderstorms and how many severe weather reports we've seen across portions of Texas on into Oklahoma and really much of the plain states in the past couple of weeks, over 1,000 severe weather reports.

And, of course, it is the time of year you expect to see large-scale activity but the pattern continues and the wet weather continues.

The video showed there moments ago of the flooding that's taking place. We're talking about a widespread area of some four to six inches of rainfall get into Jackson, Mississippi, get into Austin, Texas there, we're talking the wettest start for the month of May on record across some of these areas.

And, of course, the rain gauges here really do a good job of showing the widespread coverage of the flooding from the upper Midwest to all the way down there towards the Gulf Coast states. And about 300 gauges reporting flooding at this hour.

And notice about 120 of them in the moderate to major flood stage. This is expected to persist potentially into the early portion of the month of June. So still several more weeks left before we see water levels want to drop across this region.

But the severe concern is there. It's about 700,000 people that are in line for the activity. And generally, just west of San Antonio on into Del Rio, that's the highest risk zone for severe weather later this afternoon.

And one more thing to leave you with. Take you towards the Northeastern U.S., that's a classic nor'easter lining up, albeit a weak one for this time of year. We do have cold air filtering in and snow showers since the higher elevations. Get up above 2,000 feet. The green white mountains have a pretty decent amount of snow fall in the forecast at least the next couple of days across this region.

So, winter still hanging on across the highest elevations of the northeast there. Highs in New York today only at 50 degrees while in Atlanta a comfortable 75. And down in Texas dryer weather, at least from the sky's perspective. Temps there, guys, about 84 degrees this afternoon.

HOWELL: I'll take 75 here in Atlanta.

CHURCH: Yes, absolutely.

HOWELL: Pedram --

CHURCH: Let's stick with that. Thank you so much.

HOWELL: Pedram, thank you so much.

So, it came down to one last game and high drama. How Manchester City took the premier league title with real style.


CHURCH: It came down to the wire, but Manchester City won the English Premier League for the second straight season. Man. City retained the title after defeating Brighton four-one.

HOWELL: The win allowed them to edge out Liverpool, 98 points to 97 to become the league's first back-to-back champions in 10 years.

Mark Bolton has more now on their incredible path to the title.

MARK BOLTON, JOURNALIST: Twenty-sixth managerial trophy won and eighth domestic championship secured. But Pep Guardiola, manager of Manchester City, said this was the toughest to win.

His first words were to congratulate his near rivals Liverpool, not in terms of the challenge they put up on points, but instead the caliber of the challenge and what he have demanded of his own side, a heightening in the general level of football in the Premier League, he said, in terms of quality, class and sheer determination.

The Premier League pendulum had swung to and fro right from the start. It never seemed to want to stop. Liverpool one week, Manchester City the other, and, indeed, that's how it played out in the final day. Expectation ahead of kickoff quickly turning to dismay. Liverpool ahead. City behind. The unthinkable about to happen.

But the 2012 savior stepped up again. When required, as always, Sergio Aguero was there. The fight that was on and was soon sealed. Champions again they defended it, and for a fourth time in eight seasons.

Manchester City, kings of England. But how does it rank overall? Their club captain, Vincent Kompany, has won four. He said this is the best.

[03:54:59] In terms of entertainment and how much we've enjoyed it, well, there's no doubt it has been.

Mark Bolton, CNN, Manchester.

CHURCH: Well, Facebook is pushing back against growing calls to break up the tech giant. On Thursday, Facebook co-founder Chris Hughes wrote an opinion piece in the New York Times. He says Facebook CEO Mark Zuckerberg has unchecked power far beyond anyone else in business or government.

HOWELL: Hughes adds U.S. regulators should dismantle the company and force it to give up Instagram and WhatsApp. In march, Zuckerberg signaled he is open to some regulation.

CHURCH: Well, in Spain what's been dubbed as the nation's longest urban slide has been temporarily closed after just a day in operation.

HOWELL: This video gives you an idea why. You can see some people flying off the end of the slide. Some users reported minor injuries after the facility opened on Thursday. So, officials closed the slide for an additional review for the next day.

CHURCH: That might have been something they should have checked before they ended up, right?


HOWELL: Probably should have, yes.

And finally, the Duchess of Sussex celebrated her first ever Mother's Day by sharing an image of her first-born child.

CHURCH: And it's gorgeous. She and Harry posted this picture on Instagram showing the little feet, the little toes of baby Archie. And the caption read paying tribute to all mothers, past present and mother's to be.

HOWELL: And in the background you can also see Princess Diana's favorite flower, forget me not. The U.K. celebrates Mother's Day in march, but the United States, where Meghan Markle is from, celebrates on Sunday.

CHURCH: Gorgeous little feet there. And thank you so much for joining us. I'm Rosemary Church.

HOWELL: I'm George Howell. For our viewers in the United States, Early Start is next. For our viewers around the world, Max Foster is live in London with more of CNN Newsroom. Thanks for being with us.

CHURCH: Have a great day.