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EARLY START

U.S. Struggles To Contain Coronavirus Pandemic; Congressional Leaders Briefed On Russian Bounty Intelligence; Longtime Jeffrey Epstein Associate Ghislaine Maxwell Arrested. Aired 5:30-6a ET

Aired July 3, 2020 - 05:30   ET

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


[05:30:00]

CHRISTINE ROMANS, CNN ANCHOR: Good morning, everyone. This is EARLY START. I'm Christine Romans.

LAURA JARRETT, CNN ANCHOR: And I'm Laura Jarrett. Twenty-nine minutes past the hour here in New York.

Heading into this Fourth of July weekend there is serious concern holiday travel and celebrations could make this growing health emergency even worse. The U.S. hitting a new daily record of almost 53,000 Covid-19 cases, the second day in a row with us topping 50,000. New cases being added at almost triple the rate from three weeks ago.

(BEGIN VIDEO CLIP)

DR. TOM FRIEDEN, FORMER DIRECTOR, CENTERS FOR DISEASE CONTROL: If you turn your back on the virus, if you turn your back on science, it's going to bite you. We're not following what we know will work. We're not scaling up a comprehensive approach.

(END VIDEO CLIP)

ROMANS: Overnight, President Trump tweeting out falsehoods and superlatives about the virus, saying "There is a rise in coronavirus cases because our testing is so massive and so good."

That's not true. The percentage of positive cases -- that's the true indicator of spread -- that has almost doubled over the last month, nationwide.

JARRETT: Yes, Christine, that's why this map is now a sea of red. Three-quarters of the states are headed in the wrong direction. And that rampant growth comes after many regions reopened without meeting the CDC's criteria, including big cities like Houston where the positive test rate is at an incredible 25 percent and hospitals are transferring patients elsewhere.

The country's top expert on the pandemic laying bare the state of play, a reality the president continues to fail to confront.

(BEGIN VIDEO CLIP) DONALD TRUMP, PRESIDENT OF THE UNITED STATES: The crisis is being handled. We have some areas where we're putting out the flames or the fires and that's working out well.

DR. ANTHONY FAUCI, DIRECTOR, NATIONAL INSTITUTE OF ALLERGY AND INFECTIOUS DISEASES, NATIONAL INSTITUTES OF HEALTH: I think it's pretty obvious that we are not going in the right direction. Only about 50 percent of the country locked down. That allowed the perpetuation of the outbreak.

(END VIDEO CLIP)

ROMANS: Now, the president also points out the coronavirus death rate is down. That is true for now, but hospitalizations and deaths are a lagging indicator. The CDC is now projecting another 20,000 deaths in the next three weeks.

The obvious concern is that the raging spread seen in New York City in the spring will be repeated in numerous other states this summer.

(BEGIN VIDEO CLIP)

DR. MURTAZA AKHTER, E.R. PHYSICIAN, VALLEYWISE HEALTH MEDICAL CENTER, PHOENIX: It almost feels like the new normal where we're getting a crush of patients. A couple of weeks ago I was mentioning that I don't think the state's data had caught up yet, and in that time, they've begun catching up. We are basically -- everybody I was seeing was even sicker than the data suggested.

And now we're seeing it. We're seeing in the E.R. a lot of sick people coming in of all ages. And the positivity rate of Covid we have is ridiculous and certainly, kind of stressing the hospital systems. And our colleagues are getting stressed, too, because there's only so much of this that you can handle before you begin wondering what do we do next.

(END VIDEO CLIP)

JARRETT: Now, officials in the nation's second and third most populous states have been moved to action. The governor of Texas is requiring masks in public in counties with more than 20 cases. That's covered about 95 percent of the population there.

(BEGIN VIDEO CLIP)

GOV. GREG ABBOTT (R), TEXAS: The goal behind the masks requirement is to ensure that we will be able to continue to open up Texas for business while also protecting the health and safety of our fellow Texans.

(END VIDEO CLIP)

ROMANS: A different story in Florida, which yesterday, spiked to 10,000 cases in a day. Miami-Dade -- that county is responding with a 10:00 p.m. to 6:00 a.m. curfew, but statewide action remains elusive.

Vice President Mike Pence was in Florida yesterday. Two weeks after taking a victory lap, he now reversed course.

(BEGIN VIDEO CLIP)

MIKE PENCE, VICE PRESIDENT OF THE UNITED STATES (JUNE 18, 2020): We slowed the spread, we flattened the curve.

PENCE (JULY 2, 2020): We will slow the spread, we will flatten the curve.

(END VIDEO CLIP)

JARRETT: More states and cities are taking steps to keep the virus out. Pennsylvania is asking residents to self-quarantine after traveling to states with high infection rates. Chicago is directing travelers from states with surging infections to quarantine for 14 days.

Health officials have spent the week urging people to act responsibly over this holiday, as always. But today, the president heads to South Dakota for fireworks.

Two possible problems here. The state's governor has said social distancing will not be required, and Rushmore has not had fireworks in 10 years because of a wildfire threat.

ROMANS: All right.

The economy is slowly recovering. Many are wondering is more stimulus from the government is on the way. The concern now is the recovering jobs market and a rising stock market give Congress cover maybe to wait longer.

Here's the stimulus state of play. White House adviser Larry Kudlow said Thursday the $600 enhanced unemployment benefits may not be needed for longer.

Senate majority leader Mitch McConnell has taken a wait-and-see approach, even as President Trump says he supports a phase four stimulus plan and he wants to see more money going to Americans in stimulus checks.

And, Treasury Sec. Steven Mnuchin, Thursday, says the next round of stimulus could include funding for schools.

But there's not a lot of time to get this done because the House and the Senate have alternating schedules. Congress will have to reach some kind of a deal between July 20th and 31st.

JARRETT: Funding for schools so key, Christine, as how can kids go back to school? It's one of the biggest unresolved issues of the pandemic.

[05:35:05]

When cases were declining, the hope was that schools could reopen with new safety guidelines in place. But as this situation worsens, 56 million students and their parents in cities nationwide, including Los Angeles, may have to wait for clarity.

(BEGIN VIDEO CLIP)

DEBRA DUARDO, LOS ANGELES COUNTY SUPERINTENDENT OF SCHOOLS: Some students will come to school every day. There will be a hybrid of some having some of their days at school and other days receiving instruction at home.

We're also looking at many of our partners in the city and in the county so that for the students that may participate in a hybrid program where they're in school a couple of days a week, looking at having learning centers either at libraries, parks, Boys & Girls Clubs. Other places where students can go during the day so that their parents can continue to work.

(END VIDEO CLIP)

JARRETT: No one can forget what spring looked like. Little ones refusing to sit still in front of computer screens, older kids blowing the whole thing off sometimes. Bottom line, businesses want their employees back at work but realistically, how can that happen if students aren't physically back in classrooms?

ROMANS: Yes. How could you be a full-time employee and a full-time parent-teacher at the same time? It's just a real conundrum for millions of parents.

On Thursday, New York City Mayor Bill de Blasio vowed to reopen schools in September but said there could be staggered schedules and other changes.

Even so, the American Academy of Pediatrics is stressing the need to send children back to school safely.

(BEGIN VIDEO CLIP)

DR. SARA GOZA, PRESIDENT, AMERICAN ACADEMY OF PEDIATRICS: This pandemic has been especially hard on families who rely on school lunches or have limited access to the Internet or health care -- or where both parents work and the children have to go to day care.

So this is really critical that if it's safe, we need to have children -- the goal should be to have students physically present in the school.

(END VIDEO CLIP)

ROMANS: Students of all ages are dealing with uncertainty. The University of Southern California is changing plans for the fall. Undergraduate classes will now be mostly online.

JARRETT: Well, more than two million Gen-Zers moved back in with their parents in March and April. Layoffs squeezed their incomes and lockdowns and made their shared city apartments feel even more cramped. Long-term effects could be far-reaching for careers, lifestyles -- even the real estate business. CNN's Clare Sebastian has more now.

(BEGIN VIDEOTAPE)

CLARE SEBASTIAN, CNN CORRESPONDENT (voice-over): When Daniel Tetley left L.A. in mid-March to celebrate his 25th birthday in New York, he had no idea he wouldn't be going back.

DANIEL TETLEY, FORMER RESTAURANT SERVER: The moment that I landed, my phone blew up. I had like a thousand texts. My restaurant had shut down and New York City had shut down. And my parents came and picked me up and we came back to Connecticut, and I never went back.

SEBASTIAN (voice-over): He was furloughed from the restaurant he worked at and his lease was monthly, so he simply gave notice and a friend shipped his belongings.

TETLEY: My two other siblings -- all three of us are home again and I don't think anyone ever thought that we would ever be in this situation again in our childhood home.

SEBASTIAN (voice-over): Least of all, his mom, Kathleen.

KATHLEEN TETLEY, THREE ADULTS KIDS LIVING AT HOME: Now there's meals every night for mom to cook. The laundry is always filled with somebody else using my washer. The dishwasher runs night and day. The food bills are crazy.

SEBASTIAN (voice-over): Daniel and his siblings are among 2.7 million Americans, mostly age 25 and under, who moved in with parents or grandparents in March and April this year, taking the total to a record 32 million, according to real estate Web site Zillow.

SKYLAR OLSEN, SENIOR PRINCIPAL ECONOMIST, ZILLOW: When you think about the size of the people that are moving back home, you're talking around $726 million at risk that traditionally flows into that rental market.

Now, rent non-payment or more people doubling up like this and moving back home is causing the pressure to come off of rent growth.

SEBASTIAN (on camera): Young people have been some of the hardest hit by job losses during the pandemic. Now, if the unemployment picture continues to improve, we may see some of them starting to come back into the rental market.

But it's not just those who lost jobs who decided to head back home to mom and dad.

TARIKA GADH, MANAGEMENT CONSULTANT: The rumor started spreading in New York that subways are going to close down, the city's going to shut down, and offices are shutting down. So at that point, I booked a flight home.

SEBASTIAN (voice-over): Twenty-four-year-old Tarika Gadh works as a management consultant in New York, a job she can keep doing from her parents' house in L.A.

GADH: I live alone in New York in a one-bedroom apartment. Just knowing that if I had to be quarantined alone, I knew it wouldn't be easy.

SEBASTIAN (voice-over): Her New York lease was up in May and she didn't extend. Her plan now is to stay with her parents until her office reopens.

GADH: I definitely fear, in a way, that it is stunting my growth as a -- as a recent college graduate. I think even my mom is worried about me. She keeps telling people that this year's a wasted year for me.

SEBASTIAN (voice-over): And experts say the longer young people stay at home, the deeper the impact on real estate.

[05:40:00]

OLSEN: It is an incredible advantage to avoid rent (ph), especially when rent is taking up a larger and larger share of income and student loan debt is at record highs. Now, if they stay in their Gen X parents' homes, then that could have repercussions not just for the rental market but for the for-sale market as well in the future.

SEBASTIAN (voice-over): Weeks have already turned to months for millions of Americans living in these new arrangements. The question now is whether months turn to years.

Clare Sebastian, CNN, New York.

(END VIDEOTAPE)

ROMANS: Thanks for that, Clare. A great piece.

All right. Would you take a trip to the edge of space?

(COMMERCIAL BREAK)

JARRETT: Welcome back.

Coronavirus cases are surging in the Middle East and North Africa. Iraq reported a 600 percent increase in June. Hospitals there are near capacity. Schools and universities are now being converted into isolation units.

[05:45:03]

In Israel, certain social gathering restrictions are being reimposed. Cases there hit a new daily record Thursday, more than tripling in two weeks.

Cases have also hit record levels in the Palestinian territories.

ROMANS: Top leaders in Congress are contemplating their next move after a briefing on Russia and Afghanistan. It has been a dizzying week of headlines with reports Russia offered bounties for Taliban fighters to kill American soldiers.

The White House had the information one year ago but apparently, President Trump was never briefed orally. The intelligence was in a written briefing this spring.

Lauren Fox has more from Capitol Hill.

(BEGIN VIDEOTAPE)

LAUREN FOX, CNN CONGRESSIONAL REPORTER: Well, Laura and Christine, this was a highly classified briefing, meaning lawmakers who were coming out of the SCIF yesterday weren't offering much in terms of information that they'd learned inside of that room.

Instead, independent of this briefing, both Nancy Pelosi, the Speaker of the House, and Chuck Schumer, the top Democrat in the Senate, argued that they were uncomfortable with the relationship between President Trump and Vladimir Putin, arguing that the president needed to show more distance with the president of Russia.

Now, yesterday, House Speaker Nancy Pelosi held a press conference and I asked her directly did she think President Trump should have been verbally briefed.

REP. NANCY PELOSI (D-CA): Let me just say this, you got the con. The White House put on a con that if you don't have 100 percent consensus on intelligence that you shouldn't be -- it shouldn't rise to a certain level. Well, we would practically be investigating nothing if you had to start off at 100 percent.

FOX: And it's notable that in the briefing yesterday it wasn't just DNI John Ratcliffe, who is newly-minted in his job. He's a close ally of President Trump and a former congressman. It also included CIA director Gina Haspel. She's someone who Democrats have been arguing they needed to hear from all week long.

But still, very little coming out of that briefing yesterday in terms of public commentary about what lawmakers learned -- Christine and Laura.

(END VIDEOTAPE)

JARRETT: Lauren, thank you for that.

Iran's main nuclear fuel production facility has been badly damaged by an explosion and a fire. It's believed the Iranians are making a new generation of centrifuges there. U.S. officials have repeatedly warned the centrifuges could speed Tehran's path to developing nuclear weapons.

A Middle Eastern intelligence official tells "The New York Times" the blast was caused by an explosive device that was planted inside the facility.

ROMANS: All right. Swift fallout from the arrest of Ghislaine Maxwell, the longtime girlfriend of Jeffrey Epstein who has been accused of luring young girls into the former financiers' homes for abuse.

Federal prosecutors say they would still welcome Britain's Prince Andrew coming to speak with them. The queen's son denies any wrongdoing but has faced a swirl of questions over his relationship with Epstein, who died by suicide in jail last year while awaiting trial for alleged sex trafficking.

A source says Prince Andrew's team is bewildered by the DOJ. But there is always the chance that Maxwell could turn on him.

CNN's Kara Scannell has more.

(BEGIN VIDEOTAPE)

KARA SCANNELL, CNN REPORTER: Ghislaine Maxwell, Jeffrey Epstein's onetime girlfriend and longtime associate, indicted Thursday on six charges, including enticing minors to travel to engage in illegal sexual acts.

Prosecutors alleging that Maxwell worked with Epstein as far back as 1994. That's about eight years earlier than had previously been alleged. Prosecutors say that Maxwell had helped recruit, groom, and ultimately, abuse girls. The victims, as young as 14 years old.

Acting U.S. Attorney Audrey Strauss described Maxwell's role.

AUDREY STRAUSS, ACTING U.S. ATTORNEY: Maxwell enticed minor girls, got them to trust her, then delivered them into the trap that she and Epstein had set for them. She pretended to be a woman they could trust. All the while, she was setting them up to be sexually abused by Epstein and in some cases, by Maxwell, herself.

SCANNELL: Maxwell has been detained temporarily until she faces a judge here in New York. Prosecutors, though, do intend to ask that she be held behind bars until her trial, saying that she is a flight risk. Maxwell has three passports; 15 banks accounts, including one that at one point held more than $20 million; and no ties to the U.S.

We have not heard from Maxwell or her attorney yet to address the charges, but Maxwell has always maintained that she's done nothing wrong. Prosecutors say their investigation is continuing and they ask any witnesses or victims to come forward -- Christine, Laura.

(END VIDEOTAPE)

JARRETT: All right, Kara, thank you.

New York's former top federal prosecutor, Geoffrey Berman, will testify behind closed doors before Congress next week about his forced resignation. Berman spearheaded a number of high-profile investigations that have angered President Trump, including an investigation of President Trump's personal lawyer and former mayor, Rudy Giuliani. [05:50:04]

Berman's abrupt and unusual removal has fueled further scrutiny of Attorney General Bill Barr and fueled criticism that he's been politicizing the Justice Department on the president's behalf.

Now, CNN has learned there is talk of a job swap that would shift the U.S. attorney in Brooklyn to a top role at DOJ in Washington, leaving the prosecutor's position to be filled by an ally of Bill Barr.

ROMANS: New this morning, the U.S. Supreme Court, last night, cleared the way for Alabama to make it more complicated to vote by mail in the name of guarding against ballot fraud. In a five to four vote, the justices temporarily blocked a lower court order easing photo I.D. and witness requirements for absentee voting during this pandemic.

President Trump has repeatedly cast suspicion around voting by mail, claiming there is massive fraud -- though the president votes by mail, himself.

Numerous studies have shown voter fraud is all but non-existent in the U.S.

JARRETT: A Miami-Dade police officer faces termination for striking a woman during an argument at the airport after she missed her flight.

(BEGIN VIDEO CLIP)

PARIS SHARON ANDERSON, STRUCK BY MIAMI-DADE POLICE OFFICER: (INAUDIBLE) for real. What you going to do?

ANTONIO CLEMENTE RODRIGUEZ, MIAMI-DADE POLICE OFFICER: (Slaps Anderson in the face).

(END VIDEO CLIP)

JARRETT: Officer Anthony Rodriguez wrote in his report that he hit the 21-year-old Paris Sharon Anderson after she bumped into him and struck his chin with her head. You can hear someone say "she head- butted me," although it's not clear from the video exactly all that has happened. But you can see him strike her.

Anderson was charged with battery on a police officer and disorderly conduct. She has been released on bail.

ROMANS: That's a bit tense there.

All right, let's get a check on CNN Business this morning. Taking a look at markets around the world, you can see Asian shares have closed higher. European markets have opened slightly lower here.

Stocks finished up yesterday on that better-than-expected jobs report. The Dow gained 92 points, the S&P 500 rose slightly, and the Nasdaq set a record high for the second day in a row. It was a strong week for stocks. The Nasdaq climbing 4.6 percent for the week.

Markets are closed today for the Independence Day holiday.

An all-time low for mortgage rates and they keep falling. Freddie Mac shows the average 30-year fixed rate fell to a record 3.07 percent this week, the lowest level in 50 years. The 15-year, 2.56 percent.

Freddie Mac notes the recent rebound in economic activity may have come to a halt over the past few weeks, noting some declines in consumer spending. The longer-term picture is murky. Low rates are luring people back into the housing market but economists say the rise in coronavirus cases and uncertainty during the recession is holding sellers back.

There may be a movie theater in your Walmart parking lot soon. Starting next month, Walmart temporarily converting 160 of its U.S. store parking lots into drive-in theaters. The retailer is partnering with Robert DeNiro's Tribeca Enterprises.

Drive-in theaters have been making a comeback as a safe alternative to movie theaters during the pandemic. Locations haven't been announced yet. The event will run through October.

JARRETT: The NFL plans to play the song "Lift Every Voice and Sing" before every weeklong kick-off of the 2020 season. The song, known as the black national anthem, would be performed before "The Star- Spangled Banner" according to a source.

The league is said to be considering other ways to recognize victims of police brutality as well, like putting names on helmet decals.

ROMANS: All right, an update now on the long road to recovery for Lego Turtle. The eastern box turtle suffered fractures to the bottom part of his shell in 2008. The Maryland Zoo surgically repaired the damage and outfitted this little guy with a Lego wheelchair to keep his shell off the ground and allow him to heal.

We are happy to report Lego Turtle has just been released back into Baltimore's Druid Hill Park, where he was originally found. He's been fitted with a transmitter so zoo officials can keep a virtual eye on him.

JARRETT: I'm glad they're keeping tabs on him.

ROMANS: Contact tracing the turtle.

JARRETT: It's good.

All right, the ultimate day trip, perhaps, a six-hour ride to the edge of space. A Florida company, Space Perspective, plans to fly a pilot and up to eight passengers in a high-tech version of a hot air balloon. An unmanned test flight of its spaceship Neptune is scheduled for early next year and if all goes well the company hopes to be taking well-heeled space tourists sightseeing in just a few years.

The price -- it's going to cost you around $125,000 per passenger. Still, no doubt, it would make for some great viewing of the Fourth of July fireworks. I don't know about you, Christine. I will not be one of those first passengers, but it looks very cool.

ROMANS: It's not on my bucket list. But I have to say, the price tag is sort of out of this world, pun intended. That's a lot of money to spend for a quick trip to space.

[05:55:00]

JARRETT: Yes, it's pretty steep.

ROMANS: All right, have a safe Independence Day weekend, everybody. Thanks for joining us. I'm Christine Romans.

JARRETT: I'm Laura Jarrett. "NEW DAY" is next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

FAUCI: We're setting records, practically every day, of new cases. It clearly is not the right direction.

UNIDENTIFIED FEMALE: This country seeing its highest single-day of new coronavirus cases.

UNIDENTIFIED MALE: Florida hit a record high -- 10,000 new positive cases now.

GOV. RON DESANTIS (R), FLORIDA: People understand this thing doesn't just go away.

JIM SCIUTTO, CNN ANCHOR AND CHIEF NATIONAL SECURITY CORRESPONDENT: The CDC projects nearly 148,000 fatalities by the 25th of this month.

UNIDENTIFIED MALE: If this epidemic doesn't get under control, we're talking about a million deaths over the next year. This is deadly serious.

DR. WILLIAM SCHAFFNER, ADVISER, CENTERS FOR DISEASE CONTROL AND PREVENTION: This weekend, I hope we don't have a reprise of what happened --

END