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Early Start with John Berman and Zoraida Sambolin

Tea Party Fights in Primaries; China Angered by Hacking Indictments; Crisis in Libya; Spurs Manhandle Thunder, Take Game One

Aired May 20, 2014 - 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: A critical election day across the state, primaries in six states. The results could determine what happens in November and if Republicans gain enough momentum to take over the Senate. We're breaking down the races.

JOHN BERMAN, CNN ANCHOR: Breaking news overnight, China denying allegations that it spied on American companies and promising retaliation if the U.S. pushes charges against five accused Chinese hackers. We're live in Beijing with the latest.

ROMANS: Happening now, crisis in Libya. The U.S. military ready to evacuate Americans from the country's capital as deadly fights in the street rage on. We're bringing you the very latest this morning.

BERMAN: Good morning, everyone. Welcome to EARLY START. I'm John Berman.

ROMANS: I'm Christine Romans. It's Tuesday, May 20th. It's 5:00 a.m. in the East.

This morning, we're watching a critical primary day with voters deciding key races from coast to coast.

BERMAN: Election day! Polls opening just hours from now in six states. And at stake is, you know, who will be your candidates for major congressional and Senate seats and also for governors office, and just maybe, maybe some early indications about who might end up controlling the Senate after the key midterm elections in November.

CNN's political editor Paul Steinhauser has been up all night analyzing all the pre-election data to give us a sense of the races to watch.

And, Paul, I think we're all watching what's going on in Kentucky.

PAUL STEINHAUSER, CNN POLITICAL EDITOR: Oh, no doubt about it. This is game day, as you mentioned. Listen, we've got a lot of key contests, but I think the most important, the marquee battle is in Kentucky. That's where you've got this true antiestablishment versus establishment battle going on.

And who else is more establishment than Mitch McConnell, the Senate minority leader, the top Republican in the Senate? Five terms, 30 years here in D.C.

He's being challenged by Matt Bevin. He is a businessman. He's got a lot of Tea Party support, a lot of antiestablishment groups are backing Bevin. Lots of big bucks being spent on both sides here, by the candidates and by the outside groups.

But you know what? According to the latest polls, McConnell is way up, 20 to 30 points. You pick the poll. He also has the support of Kentucky's other Republican senator, a guy called Rand Paul, who, you know, is pretty influential among those on the right. So, expect McConnell probably to have a pretty easy night.

But you know what? It won't be that easy for McConnell come November. That's when he'll face off in the general election against his Democratic challenger. Her name is Alison Lundgren Grimes. She's the secretary of state in Kentucky, got a lot of support, including from a guy named Bill Clinton -- guys.

ROMANS: In 2012, we saw this wave of Tea Party challenges across the country. Is that happening today?

STEINHAUSER: It is happening today, and not just in Kentucky, also in Idaho, it's happening. That's where you've got an eight-term congressman, a guy named Mike Simpson. He is considered establishment by those on the right, the Tea Party activists.

He's facing a challenge from a very conservative man who says Simpson is not conservative enough. Kentucky, big bucks spent on both sides.

But Simpson has the backing of the U.S. Chamber of Commerce and from this guy. Take a listen.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), FORMER PRESIDENTIAL CANDIDATE: The stakes are very high in this election because Washington spending is out of control. You can take it from me. The conservative choice for Congress is Mike Simpson.

(END VIDEO CLIP)

STEINHAUSER: You're also seeing this antiestablishment verse establishment battle playing out today in Oregon, in the Senate battle there, and there's a wild free-for-all in Georgia on the Republican side, an open seat. And you've got more moderate candidates right now ahead in the polls over the more conservative candidates.

What does this matter come November? Here's why: Christine, you mentioned that the last two election cycles, you had some high-profile primaries where the conservatives, the Tea Party types want out, and come November, they lost to Democrats. Republicans arguably lost five Senate seats in the last two elections. This time around, it seems the establishment is ready.

So far, they've had the upper hand, guys. BERMAN: All right, Paul Steinhauser. It is election day, six days for watching. You'll be up all day with the rest of us as the results come in. Thanks so much, Paul.

ROMANS: You said you can smell it in the air. I thought it was pollen. You're just crying because it's election day.

BERMAN: As long as it wasn't me. I'm OK. I'll take the fall.

ROMANS: Paul Steinhauser, thanks.

All right. Tension building between the U.S. and China. Officials in Beijing this morning furious, furious over the indictment of five Chinese military officers accused of hacking into U.S. companies to steal American corporate secrets. They're now summoning U.S. Ambassador Max Baucus and threatening to retaliate.

Let's bring in David McKenzie live from Beijing this morning.

I mean, I think it's no surprise that the Chinese are furious. In the past, when the U.S. and companies have complained about the Chinese military being linked to stealing American, you know, private company and public company secrets, you know, the Chinese have said you're making it up, it's not true. That's essentially what they're saying again today.

DAVID MCKENZIE, CNN CORRESPONDENT: Well, that's right, Christine. And in fact, the quote is "fabricated facts," and they are pushing hard, saying they could retaliate in some way if the U.S., particularly the U.S. Justice Department, continues with its move to try and prosecute these five individuals.

You know, you saw these pretty dramatic wanted posters put out by the FBI, almost like they would for terrorists or other serious criminals. Some of those suspects, as they say they are, in their military uniform. So, this is new, because it is the U.S. accusing China, Chinese state actors, of being involved in hacking and stealing what they call billions of dollars of corporate secrets and private information from both competitors in the U.S. and collaborators from the nuclear industry, from green energy and from all sorts of strategic industries in the U.S., and this has put a strong signal to the Chinese, they say, to stop doing this.

The Chinese, as you say, summoned the U.S. ambassador to China for a late-night dressing down. And now they're saying if anything goes from here, they'll take unspecified actions against the U.S. So, certainly, the rhetoric ratcheting up in this case -- Christine.

ROMANS: Let's talk about what these allegations are. These are allegations like stealing nuclear power plant plans, spying on steelworkers' e-mails so they could see what the thinking was of the Americans in terms of a trade dispute over steel, looking into the corporate and e-mail banks of solar panel system because they want to see what Americans have, and in some cases, the U.S. says they want to steal it outright. MCKENZIE: Well, that's right. I mean, the one theory behind the way China has done this, if you believe the report, is, you know, why spend billions on R&D when you can just look into someone's inbox and take it for yourself and jump ahead in the competitive stakes?

And many executives I've spoken to have said in the past years they are, you know, pretty afraid of their secret information getting out when they're working with Chinese competitors. It must be said, though, this isn't the first time allegations like this have been leveled against other countries for stealing corporate secrets, and many people say that this kind of thing goes on all the time.

The difference again here is that it appears, at least according to the U.S. Justice Department, that the military here in China is working hand in hand with the state-owned corporations. So, it's less of black hat hackers and more of a government-sponsored program, if you believe that indictment.

ROMANS: And the CEOs of these companies have been pursuing aggressively their China strategies for, you know, 10, 15, 20 years. At the same time complaining that the more exposed they are to China, the more exposed they are to hacking. It's a difficult situation, a real conundrum for some of these executives.

David McKenzie, thank you so much for that report.

BERMAN: Seven minutes after the hour right now. The United States has doubled the number of aircraft standing by in Italy this morning, just in case Americans need to be rescued from the U.S. embassy in Tripoli in Libya. An evacuation order could come at any moment. This as fierce fighting erupts throughout Tripoli.

We get more now from Pentagon correspondent Barbara Starr.

(BEGIN VIDEOTAPE)

BARBARA STARR, CNN PENTAGON CORRESPONDENT: John, Christine, with violence rising every day in Libya, the question now, is that country falling into civil war? And if it is, can the U.S. embassy remain open? Can diplomats stay on the job?

If the violence gets any worse, the State Department is prepared to evacuate the 200 or so Americans that are there. A package of heavily armed marines waiting just to the north in Italy across the Mediterranean, about 250 marines equipped with eight V-22 aircraft that can fly very quickly to Italy. They are on a two-hour string.

What does that mean? That means if the evacuation order comes, they will be in the air and on their way to Libya within two hours or less.

Just a couple of years after the disaster in Benghazi, the administration is taking no chances. It has the troops and the firepower ready to go to get Americans out of Libya if it comes to that -- John, Christine.

(END VIDEOTAPE) ROMANS: All right. Our Barbara Starr, thank you for that, Barbara.

The State Department says it's closely monitoring a volatile situation unfolding this morning in Bangkok. Thailand's army declaring martial law nationwide, an announcement that caught the Thai government off guard. Army officials insisting this is not a coup, just a move to maintain peace after six months of sometimes violent antigovernment protests.

BERMAN: The CIA is promising to never again use immunization campaigns for spying, which is exactly what it did during the hunt for Osama bin Laden, setting up a hepatitis survey in the Pakistani city where he was ultimately killed to extract DNA from his relatives. This effort failed and the Pakistani doctor behind this was sent to prison. Critics say the stealth programs fuel anger against immunization workers and could promote the resurgence of diseases like polio.

ROMANS: One of the three patients in the U.S. diagnosed with the MERS virus is now fully recovered and has been discharged from an Orlando hospital. He's described as a health care provider who lives and works in Saudi Arabia. All health care workers who came in contact with him as well as his family members have tested negative for the deadly virus.

BERMAN: A top Swiss bank, Credit Suisse, has agreed to pay a nearly $3 billion fine for helping wealthy Americans hide assets through secret accounts in order to avoid paying billions of dollars in taxes. Credit Suisse pleading guilty to a criminal charge of aiding and abetting tax evasion. The deputy U.S. attorney general calls the bank's guilty plea historic and says the illegal activity at Credit Suisse was pervasive.

ROMANS: An EARLY START on your money news right now. Credit Suisse trading higher after that settlement, investors relieved the investigation's finally over. Overall, stocks in Europe slightly lower, still hovering near six-year highs. Dow futures point to a slightly lower open.

Tech stocks had a terrific day yesterday. The NASDAQ closed up nearly a percent. The Dow and S&P also closed up. Tech stocks have had a rough few months after strong gains at the beginning of the year. The index now down just over a percent year to date.

BERMAN: Big day for Vice President Joe Biden. He embarks on a four- day trip to Romania and Cyprus. This mission to reassure European allies that the U.S. is committed to the region in the face of Russian aggression in and around Ukraine.

The vice president will urge officials in Cyprus to step up sanctions against Russia. A lot of banking interests, Russian banking interests in Cyprus. And in Bucharest, the vice president will discuss how the Romanians can help Europe with its energy needs and lessen its dependence on Russian gas supplies.

ROMANS: Happening today, big business comes to the White House. President Obama expected to greet business leaders from across the country and around the world, really. Ford, Honda, Lufthansa, they are among the corporate giants represented at the meeting. The topic is jobs, investing in and creating good-paying jobs here in the U.S.

BERMAN: From big business to little business and little league. Last night, the president paid a surprise visit to a little league baseball field in northwest Washington.

Look at this. He was heading to a fund-raiser and he had to drop off his press secretary, Jay Carney, who was there to see his daughter play. And the president decided to stick around. You can see him snapping photos. He got to throw out the first pitch.

If you're president, you get to throw out the first pitch pretty much at any baseball game you go to, even a little league game. You can see how excited the kids were, parents, too. They got to take pictures with the president.

ROMANS: That's cool.

All right. Donald Sterling not giving up on his NBA team quietly. Did we think he would? I didn't think he would. Overnight, he's making new demands as the league formally begins the process of taking the L.A. Clippers away from him.

BERMAN: Plus, another V.A. hospital under scrutiny, accused of lying about patient care. We will tell you where investigators are looking now.

(COMMERCIAL BREAK)

ROMANS: The so-called hook-handed terrorist has been convicted. On the second day of deliberations, a Manhattan jury finding Abu Hamza al-Masri guilty, guilty on 11 terror-related charges. The incendiary Muslim cleric was accused of inspiring terrorists, aiding kidnappers and trying to start a terror training camp in Oregon. He'll be sentenced on September 9th and faces life in prison.

BERMAN: The House of Representatives is stepping up efforts to fight human trafficking. Several lawmakers, including House Majority Leader Eric Cantor, will address that issue today. According to officials, there are some 20 million victims worldwide and more than 17,000 people are trafficked into the U.S. annually. Many of them children caught in the commercial sex trade. Five bipartisan bills are expected to hit the House floor this week.

ROMANS: You may soon be able to text 911. As of this month, four major wireless carriers are making the emergency service available across the nation. Supporters call it a long overdue step toward updating the emergency response system, local governments in 16 states already using this.

The federal government will require all service providers to offer it by the end of the year.

BERMAN: The NBA has now set a date, June 3rd, for potentially voting Donald Sterling out as owner of the Los Angeles Clippers. The league on Monday officially began the process of removing Sterling on charges that he has damaged the league with those racist comments. Sterling has until May 27th to respond and can present his side at the special board of governors meeting on June 3rd.

The NBA not commenting on a "Sports Illustrated" report that Sterling's lawyer is demanding a three-month delay to prepare a response. I can't imagine the NBA wants any kind of delay here.

ROMANS: We are learning new details on last month's near collision at Newark airport. According to a new report, the planes were separated by just 200 feet laterally, 400 feet vertically. The planes were operating on intersecting runways. As one was taking off, the other was landing. A combined 211 people were on the flights.

No one was injured, thankfully. A final report is not expected for several months, but that is too close of a call.

BERMAN: Really close.

Another veterans medical center under investigation this morning after officials found a wait list of patients kept on paper rather than in the V.A.'s computer system. Three staff members at the Gainesville, Florida, facility have been placed on leave. This comes amid a widening scandal where whistleblowers say they were told to cook the books to conceal long wait lists. In Phoenix, at least 40 veterans may have died waiting for care.

ROMANS: All right, if you've never experienced the sheer enormity and power of a super cell storm, check out this extraordinary time-lapse video. It was shot by storm chasers near Newcastle, Wyoming.

BERMAN: It's nuts.

ROMANS: This system produced torrential downpours, baseball-sized hail. Super cells are a special kind of single-cell thunderstorm. It can last for hours and spawn almost every significant tornado in the U.S. and you love that word.

BERMAN: Spawn.

ROMANS: You love the word spawn.

BERMAN: Spawn. Indra Petersons has a look now at the forecast.

Good morning, Indra.

ROMANS: Good morning, Indra.

INDRA PETERSONS, AMS METEOROLOGIST: Can we go back to baseball-sized hail? I mean, this, literally, falling on your head?

BERMAN: It spawned baseball-sized hail.

PETERSONS: It spawned baseball-sized hail, yeah. Good news today, still looking at relief on the fire lines. Let's talk about what's going on.

California looking so much better already. Red flag warnings -- yes, they are out there, but, of course, right now, we're seeing them spread farther to the east, but even they are going to be seeing relief? Why? Let's talk about it. We're starting to see a huge shift in the pattern. We're talking about that low pressure system making its way in.

And think about the drought conditions that have been around Texas and of course the southern plains, this means well-needed rain will be moving into the area. That is good news. The bad side of this, once again, we do have the threat for severe weather. So, think about what you saw yesterday, those super cells, right? Look at all the moisture, especially when you talk about the upper Midwest. That's the exact area we are going to be having that concern today.

We do have, notice the warm temperatures on top of all that moisture, well above normal, going -- look at Chicago looking for 84 degrees today. So, now you know why 20 million -- 29 million of you, actually, are looking for severe weather right in that zone, Milwaukee, Chicago, Indianapolis, Toledo, even Columbus, also portions of Colorado today are going to be having that threat for that severe weather. The rest of us looking at a system making its way through the course, the same one, Ohio valley into the Northeast, looking for rain already in the northeast starting by tomorrow night.

Not a lot of rain, maybe one to three inches over the next several days. We can handle it, but it's still severe weather. It's that time of the year. I don't want to see any more of this baseball-sized hail.

ROMANS: I know. I do love the forecast for Chicago, 84 in Chicago.

PETERSONS: I think they're all right without the severe weather.

BERMAN: If only you were in Chicago --

ROMANS: I know.

BERMAN: -- you're not.

PETERSONS: Uh-oh.

ROMANS: Want to be on the beach getting sun-burned, first warm day of May.

All right. Coming up, horse racing fans breathing a little easier now that California Chrome will be allowed to breathe easier, and I will breathe easier once we don't have any more puns about California Chrome coming up next on the Belmont Stakes.

Joe Carter's got the details. And 152 puns about California Chrome in the "Bleacher Report."

BERMAN: This is a major defeat for mucus enthusiasts everywhere.

ROMANS: Oh, God!

(COMMERCIAL BREAK)

BERMAN: While you were sleeping, the San Antonio Spurs certainly were not. They were beating up on the Oklahoma City Thunder in game one of the Western Conference Finals, taking advantage of really a shorthanded Thunder team.

ROMANS: Joe Carter has more in the "Bleacher Report" this morning.

Hey, Joe.

JOE CARTER, BLEACHER REPORT: Hey, good morning, guys.

Yes, Oklahoma City does not have their big man, Serge Ibaka. He's out right now with a calf injury. And you could tell last night from the opening tip that the size of the San Antonio Spurs was going to be a matchup problem for Oklahoma City. The Spurs absolutely took advantage of no big man in the paint. They scored a staggering 66 points down low.

Tim Duncan, who goes 6'11", had no one to contest his long arms. He led the way with 27 points. Now, San Antonio, who lost all four regular season games to Oklahoma City, had no problem beating them last night by 17 points. They take game one of the Western Conference Finals. So, game two is back in San Antonio on Wednesday night.

Well, here's my pun, guys. Horse racing fans can breathe a little easier. California Chrome will arrive in New York today. That story's trending on bleacherreport.com.

Of course, preparations for the final race of the Triple Crown now begins for the horse. The trainer of the Kentucky Derby and Preakness stakes winner had previously threatened to keep the horse out of the Belmont Stakes in a dispute over nose strips. But yesterday, New York racing officials relented, saying California Chrome can wear the strips during the race. By the way, the Belmont is June 7th.

Eleven-year-old Lucy Li made golf history yesterday. She's the youngest player to qualify for the women's U.S. open. She earned the amateur spot after winning a local tournament by seven shots. Now, the California native already has a big win on her resume. She won a drive, chip and putt championship for 10 and 11-year-olds at Augusta National back in April.

And finally, check out this video during the Tigers/Indians game last night. A fan tries to catch what would be a souvenir thrown into the stands, but the ball goes straight through his hands and right into the face. Ouch! Watch the replay once again.

I think it's the lights. I think he loses it in the lights, but right through the hands, right into the noggin. So, he gets a bloody lip, no souvenir, and this is kind of the most embarrassing part. It's the walk of shame back to his girlfriend. Are you OK, baby? Are you OK? It's okay. It's going to be all right.

ROMANS: Wow.

CARTER: Again, John, you know this just as any other baseball fan. The debate continues now after seeing this video. Should grown men bring a baseball glove to a baseball game?

BERMAN: The answer to that is no, is my opinion, but Joe, the most interesting thing here was your dramatic reenactment of the girlfriend's conversation with the boyfriend as he walked back there. More one time, can we hear some more what you actually said?

CARTER: Are you OK, baby? Are you OK?

I'm assuming it's his girlfriend, I don't know, but it seemed like it was --

ROMANS: I thought she was saying, my other boyfriend would have caught that ball.

BERMAN: Nice.

CARTER: Nice.

ROMAN: Thanks, guys.

BERMAN: Happening right now, critical primary elections across the country. Today's results really could help determine whether Republicans have a shot to take back the Senate this November. We're breaking it all down right after the break.

(COMMERCIAL BREAK)