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EARLY START

Texts Link Ukraine Meeting to 2016 Probe; Trump Calls for China to Probe Bidens; U.S. Manufacturing Sector in Contraction; Seahawks Win Thursday Night Thriller 30-29. Aired 5-5:30a ET

Aired October 4, 2019 - 05:00   ET

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


CHRISTINE ROMANS, CNN ANCHOR: -- released by House Democrats, a damning new twist for the White House.

[05:00:04]

The texts show how the U.S. leveraged a possible meeting between President Trump and Ukrainian President Volodymyr Zelensky to push for an investigation into the 2016 election.

The texts were provided by former U.S. special envoy to Ukraine, Kurt Volker, who testified behind closed doors yesterday.

DAVE BRIGGS, CNN ANCHOR: On July 25th, the morning of the now- infamous call between the presidents, Volker texted a top Zelensky adviser.

Quote: Heard from White House -- assuming President Z convinces Trump he will investigate/get to the bottom of what happened in 2016, we will nail down date for visit to Washington.

A source tells us the Ukrainians responded by drafting a public statement committing to investigate corruption. The statement ultimately made it to President Trump's personal attorney and point man on Ukraine, Rudy Giuliani. Giuliani said that statement didn't go far enough and suggested adding references that would imply investigation of Joe Biden and his son Hunter and the 2016 election.

ROMANS: The newly-released texts also show a top U.S. diplomat was concerned President Trump was withholding hundreds of millions of dollars in military aid would amount to a quid pro quo.

On September 1st, the senior U.S. diplomat in the Ukraine, Bill Taylor, texted Gordon Sondland, the U.S. ambassador to the European Union.

Taylor wrote this: Are we now saying that security assistance and a White House meeting are conditioned on investigations?

Sondland responded, Call me.

BRIGGS: On September 9th, Taylor spelled out his concerns. As I said on the phone, I think it's crazy to withhold security assistance for help with a political campaign. Four and one-half hours later, Sondland replied: I believe you are incorrect about President Trump's intentions. The president has been crystal clear no quid pro quos of any kind.

ROMANS: Sources say Volker told investigators yesterday he urged Ukraine not interfere in U.S. politics.

"The Washington Post" reports Volker said he warned Giuliani that Ukrainian claims were unreliable.

Today, the inspector general for the Intelligence Community, Michael Atkinson, will testify to House panels behind closed doors.

BRIGGS: The texts capped a whirlwind day of developments on the impeachment front.

Perhaps the most shocking, that President Trump, already under investigation for secretly asking a foreign government to interfere in U.S. elections, is that he did it again for all the world to see.

Jim Acosta at the White House.

(BEGIN VIDEOTAPE)

JIM ACOSTA, CNN CHIEF WHITE HOUSE CORRESPONDENT: Dave and Christine, it was a remarkable moment -- one for the history books -- as President Trump stood outside the White House and called for foreign interference in the 2020 election.

The president asked China to dig up dirt on former vice president Joe Biden. Unlike his conversation with Ukraine's president, no call transcript is necessary here. The president said the quiet part out loud.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: China should start an investigation into the Bidens because what happened to China is just about as bad as what happened with Ukraine.

ACOSTA: It's become more difficult for the White House and its defenders to accuse the whistleblower complaint of relying upon hearsay to accuse the president of asking a foreign government to interfere in the upcoming election, as the president did that in front of the cameras -- Dave and Christine.

(END VIDEOTAPE)

ACOSTA: All right. Jim Acosta, thanks, Jim.

The president also saying yesterday that he had not spoken with Chinese President Xi Jinping about investigating conspiracy theories about the Bidens. That is not true.

CNN has learned exclusively Mr. Trump did raise Joe Biden with President Xi in a June phone call. The president's suggestion that the Chinese investigate the Bidens thrust his political grudge into the world's most complicated and consequential relationship. Kylie Atwood, part of the team that broke the story, has more for us.

(BEGIN VIDEOTAPE)

KYLIE ATWOOD, CNN NATIONAL SECURITY REPORTER: Christine and Dave, now, during a phone call between President Trump and President Xi in June, we are learning that Trump did mention Joe Biden, the former vice president and now his most formidable Democratic opponent leading up to 2020.

He also mentioned Elizabeth Warren, according to sources familiar with this phone call, and it was in the political sense that they were doing well in the polls and that they were the ones opposing him when it comes to 2020.

We are also learning that the transcript of that call was put in the highly sensitive server -- the same server that the Ukrainian transcript was put into that we have consistently reported on over the last few weeks.

I did speak with one Chinese diplomat today who said it was chaotic as they saw these media reports coming in, but also said that China wasn't interested in getting involved in the domestic politics of the U.S. But we are still waiting to see how the Chinese government officially reacts to those statements from President Trump today.

(END VIDEOTAPE)

ROMANS: All right. Kylie Atwood, thank you for that.

BRIGGS: All right. Ahead, big slowdowns in U.S. manufacturing and the service sector made for another wild day on Wall Street. The monthly job's report just hours away. Matt Egan has all the latest for us, next.

(COMMERCIAL BREAK)

[05:09:39]

ROMANS: All right. More evidence of cracks in the American economy, another damaging economic report and rising odds of a rate cut from the Fed. After two terrible days of losses to start the fourth quarter, the Dow closed up more than 120 points.

But that really doesn't tell the story. Look at all that red at the beginning of the chart. The Dow is down more than 300 points earlier in the day.

[05:10:00]

On balance, it's lost more than 700 points since Tuesday. The sell- off began after the Institute of Supply Management reported a slow down in the biggest chunk of the economy, the U.S. service sector.

Let's bring in Matt Egan, lead writer for CNN business. And that's what many people have feared. They've seen the weakness in

manufacturing and thought maybe that was going to be isolated. Manufacturing, a smaller part of the American economy and then this.

MATT EGAN, CNN BUSINESS LEAD WRITER: That's right. Well, happy Friday, you guys. We made it through another pretty crazy week.

BRIGGS: Almost.

EGAN: Almost.

And, Christine, your point is spot on, right? Manufacturing we know it's in contraction and that's because of the trade war and this global slowdown. And now, we're learning that the service sector, restaurants, hotels. That's really the biggest part of the economy. And now it's growing at the weakest pace in three years. Employment growth and services is also slowing.

And that is certainly adding to these concerns that we could be dealing with some sort of severe slow down or maybe even a recession.

BRIGGS: Jobs numbers come out in a few hours. What do you expect and what does that tell us?

EGAN: Well, it's really, really important because I think investors are on high alert for any manufacturing slow down and really contraction is spreading. So, certainly, anything to do with manufacturing jobs. I mean, they've certainly slowed down the growth.

Does that go negative? That would be a concern.

Also there are these temporary jobs that are added because of the census. That is sort of boosting things. Also, overall, how is private sector job growth holding up? It has been slowing. I think investors and economists can live with a slow down there and we're hoping it's not any more than that, nothing like severe.

ROMANS: We've heard the president and the surrogates saying because this is because of the Democrat impeachment concerns and you take away President Trump and the economy and the stock market will fall apart, right? This is about trade and the trade war and global trade flows. Am I right?

EGAN: You are right. I mean, just look at the weekly chart of the Dow. We saw the market take a hit at 2:00 a.m. on Tuesday morning. That had nothing to do with impeachment, it had nothing to do with politics, that is when this ISM manufacturing report came out showing it was the worst month for factories since the end of the Great Recession, right?

I think impeachment does pose another uncertainty. It could alter the 2020 election, which is something that we've talked about before. But right now, it's really just noise. I think investors are really squarely focused on the economy and they're not really paying attention to that side show in Washington, at least not yet.

BRIGGS: President focused on the Fed as that war continues to escalate.

Meeting at the end of the month. Jerome Powell between a rock and a recession. What do you expect him to do?

EGAN: I do not envy his job. I mean, he is put in this impossible position and already a really tough job, and I think he's going to be under more pressure to lower interest rates, and that's because of these concerns about a recession. I mean, we saw yesterday one of the reasons why the market appeared to bounce way off the lows yesterday was because the odds of a rate cut in October have skyrocketed. They have gone up to 90 percent. A week ago they were at 50 percent. People were worried about the economy.

So, Jay Powell is going to probably have to respond to that at a certain point when it gets around 90 percent, 100 percent. I mean, they don't have a choice but cut rates.

ROMANS: Ultimately, you made this point in your stories. The Fed can't fix a trade war?

EGAN: No. Of course, not. The central bank policy is no magic wand for trade war. I mean, think about it, borrowing costs are already really low.

BRIGGS: But they can soften the blow which --

EGAN: They could extremely soften the blow and it is helping on real estate and help with autos, as well.

If you're a manufacturer and rates go a little bit lower, I don't really think that changes anything if you're worried about the trade war. If you're a restaurant owner and you're losing customers because of the factory layoffs, I don't think going lower changes anything.

ROMANS: Matt Egan, great to have you this Friday morning.

EGAN: Thank you.

ROMANS: Thanks for stopping by.

BRIGGS: All right. We'll talk a little sports next. Thursday night football, Seahawks and Rams go down to the wire. How did this one end?

Carolyn Manno with the answer in the "Bleacher Report", next.

(COMMERCIAL BREAK)

[05:19:06]

(BEGIN VIDEO CLIP)

JOAQUIN PHOENIX, ACTOR, JOKER: When you bring me out, can you introduce me as Joker?

(END VIDEO CLIP) ROMANS: This weekend's opening of the movie "Joker" has prompted a warning from the FBI. Social media threats have called for mass shootings at showings of the movie. Officials say they flagged local law enforcement out of an abundance of caution and there is no specific or credible threat.

Fears are heightened because of the 2012 mass shooting in Aurora, Colorado at a midnight showing of the Batman film "The Dark Night Rises."

BRIGGS: Creepy.

A huge night in sports with two playoff games and a thriller in the NFL that went back and forth into the final seconds.

ROMANS: Carolyn Manno has more on this morning's "Bleacher Report".

Hi, Carolyn.

CAROLYN MANNO, CNN SPORTS CORRESPONDENT: Hey, good morning. Happy Friday.

It was an electrifying Thursday night. If you did go to bed early, I don't blame you. I got you.

Let's start in Seattle. Seahawks and Rams, a top divisional game. Russell Wilson making a case for MVP. The Seattle quarterback threw for four touchdowns, starting with this amazing pass to Tyler Lockett in the back of the end zone.

[05:20:07]

Wilson placing the ball where only Lockett can get it. Look at this, concentration keeping both feet in bounds. Remarkable.

Wilson bookending his night with this. A juggling near drop to give Seattle the lead with less than 2 1/2 minutes remaining. Nice little play there.

Russell Wilson just looking phenomenal. Rams offense showing some signs of improvement, as well. Jared Goff and his team in a field goal range with 15 seconds on the clock and kicker Greg Zuerlein made his previous three kicks, misses the 44 yard, and the Seahawks hold on to win a thriller by one, the thrill of victory there and agony of defeat.

Meanwhile, MLB playoffs two juggernauts going head to head in the first game of the division series. Cardinals rallied in the eighth against Atlanta. Closer Mark Melancon and pinch hitter Matt Carpenter slicing a fly ball down the left, bring in the tying run. St. Louis would go on to add four more in the ninth. Marcell Ozuna had two-run double that would break the Cardinals, stunning the Braves in game one. It lasted over four hours.

In the meantime, Braves star Ronald Acuna Jr. facing some criticism for his lack of hustle. He hit off the wall in right field settling for just a single. Last time it happened in August, he was benched. This time, he was called out by his teammates.

(BEGIN VIDEO CLIP)

FREDDIE FREEMAN, ATLANTA BRAVES FIRST BASEMAN: It's frustrating, but I think you have that conversation once. Kind of beat the dead horse and keep having that same conversation over and over again. You have to know that was a mistake. That can't happen in the playoffs. It can't happen in the regular season.

(END VIDEO CLIP)

MANNO: There would be no such drama in Hollywood. The Nationals and Dodgers in game one of their series. Dodgers' rookie Gavin Lux making the most of his first ever playoff at-bat. Pinch homer to left field that drops into a trash can no less. L.A. cruising 6-0 in game one.

Playoff baseball just getting started, by the way. We have a quadruple header today, including two games on our sister channel TBS. So, plan according for that. Everything gets under way just after 2:00 Eastern.

So, a very, very busy time, Dave and Christine, if you are a baseball fan.

ROMANS: That's a lot of baseball.

BRIGGS: Ten hours of baseball.

ROMANS: A lot of baseball.

BRIGGS: I'm good.

ROMANS: All right. Carolyn Manno, good to see you, thanks for coming this morning.

BRIGGS: Thank you, my friend. Have a good weekend.

ROMANS: Breaking overnight, next text messages suggest a quid pro quo between the U.S. and Ukraine. What each side wanted, quite different.

(COMMERCIAL BREAK)

[05:27:15]

ROMANS: A Florida mother faces attempted murder charges. Police say she drove into a tree after telling her kids to unbuckle their seatbelts. Authorities say Calicia Williams told her children ages 7 to 13 to stretch out their hands right before she crashed her speeding minivan into the tree. All four kids were injured but none of their injuries are life threatening.

Williams said her husband had put a hex on her that caused the crash. She also had marijuana in her system. Not clear for how long.

BRIGGS: A Chicago jury is convicted a reputed gang member accused of luring a 9-year-old into an ally to kill him. Twenty-two-year-old Dwright Doty found guilty of first degree murder in the death of Tyshawn Lee. Another man, Corey Morgan was tried in the same courtroom before a separate jury, which is still deliberating. Prosecutors say Morgan and Doty executed the boy as revenge. They suspected Tyshawn's father belonged to a gang that killed Morgan's brother. Morgan and Doty blamed each other for the killing.

ROMANS: All right. There are now more than 1,000 cases of vaping related lung injuries across the U.S. The CDC says 1,080 cases reported in 48 states and the U.S. Virgin Islands. Nineteen deaths have been confirmed in 16 states. Additional deaths are under investigation.

Now, this week, the Mayo clinic reported the lung damage in some victims resembles a chemical burn. A researcher at the clinic say the injuries look like something you expect to see in toxic chemical spills.

BRIGGS: Major settlement in 2017 mass shooting in Las Vegas. MGM Resorts International agreeing to pay up to $800 million to victims and surviving family members of the 58 people killed in the massacre. It's the third largest victims' compensation settlement in U.S. history. Thousands of people may be eligible.

The agreement means all parties will dismiss any pending litigation against MGM. The court will appoint an independent administrator to oversee a settlement fund that MGM will pay into.

A lot to get in to as EARLY START continues right now.

ANNOUNCER: This is CNN breaking news.

ROMANS: New text messages suggest evidence of a quid pro quo between the U.S. and Ukraine. What both sides wanted depend on which side you ask.

Welcome back to EARLY START. I'm Christine Romans.

BRIGGS: Good morning, everyone. I'm Dave Briggs. It is 5:29 Eastern Time.

We begin with that breaking news. Right now, the Secretary of State Mike Pompeo speaking with the prime minister of Montenegro. We're not expecting him to say much, but he faces a subpoena deadline today. More on that in a moment. No questions expected to be taken there.

To that breaking news about text messages released by House Democrats, a damning new twist for the White House.

The texts show how the U.S. leveraged a possible meeting between President Trump and Ukrainian President Volodymyr Zelensky to push for an investigation into the 2016 election.

END