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Early Start with John Berman and Zoraida Sambolin

New Leads in New York Prison Manhunt; New Calls to Remove Rebel Flag; President Obama on Race in America; Cyberattack on Federal Workers Grows; Tornadoes Touch Down in Illinois & Michigan. Aired 4:30-5a ET

Aired June 23, 2015 - 04:30   ET

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

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[04:30:28] CHRISTINE ROMANS, CNN ANCHOR: New clues this morning could be bringing investigators closer to finding two dangerous killers who escaped from prison. Brand new information on that manhunt ahead.

JOHN BERMAN, CNN ANCHOR: Should the confederate flag be banished. Government leaders from South Carolina and now this morning to Mississippi pushing for the removal of the controversial symbol. That happening as one of the biggest stores in the world, you're looking at it right there, pulling all Confederate merchandise from store shelves.

ROMANS: Stunning words from President Obama giving a candid blunt interview on race in America. What he said that's stirring debate this morning. The one little word he said that is stirring debate.

BERMAN: Big word.

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

BERMAN: And I'm John Berman. About 31 minutes past the hour.

Important new leads in the manhunt for two convicts escaped from a New York maximum security prison. Authorities have found DNA from Richard Matt and David Sweat inside a hunting cabin near the town of Owls Head in Upstate New York. That cabin had been broken into. Just about 20 miles west of the prison where they escaped more than two weeks ago.

This happened after a witness spotted someone running into the woods near the cabin. About 1,000 officers have descended on to that tiny community with helicopters, ATVs and cruisers.

(BEGIN VIDEO CLIP)

REPORTER: How confident do you feel about these leads?

KEVIN MULVERHILL, FRANKLIN COUNTY SHERIFF: All options are open. Everything is on the table. And like I said, I think these are the best leads we've had since the escape.

REPORTER: Are you confident they're here in your area, in your county?

MULVERHILL: I'm confident that if they're here, we're going to catch them.

UNIDENTIFIED MALE: The information that's come in the last 48, 72 hours has been more credible and better leads probably than we've had since the escape. I think the noose is starting to tighten.

(END VIDEO CLIP)

BERMAN: A law enforcement source tells CNN that detectives are combing through months worth of guest registries from hotels in the area around the prison, looking for someone with a connection to the escapees. Officials also have a new theory on how the inmates got their hands on tools to break out of prison.

For the very latest on the investigation, let's turn to CNN's Jason Carroll.

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JASON CARROLL, CNN NATIONAL CORRESPONDENT: Christine, John, investigators calling this one of their most significant leads to date, that evidence found inside that cabin, materials linking these two inmates to DNA that they also were able to extract from the materials found inside that cabin.

Again, a significant lead for investigators, but that's just one of the developments in this story, a story that just seems to have one strange development after another. This one has to do with how these inmates allegedly got some of that contraband inside the prison. We're hearing from a source that perhaps it came through frozen hamburger meat -- I say that again, frozen hamburger meat.

And investigators are looking at the possibility that contraband or tools were inside of frozen hamburger meat delivered to Richard Matt just a week before his escape. That, again, coming to us from a source here on the ground.

Now, you should also know that these two men collected their contraband over a lengthy period of time, but it is believed that one of the guards there at the correctional facility passed this frozen chunk of hamburger meat into the prison. It did not go through metal detectors which is a violation of prison policy. These two inmates, as you know, housed in the -- what was the so-called honor guard and the honor block and as such, they were allowed to cook. That was one of their privileges. They were allowed to cook there in their cells.

So, this is just many, one of the many points that would be investigated as this investigation moves forward -- Christine, John.

(END VIDEOTAPE)

ROMANS: All right. Jason Carroll, thanks for that, Jason.

Now, this morning, we're learning new details about the months leading up to Dylann Roof's deadly rampage at the Emanuel AME Church in Charleston, South Carolina. In February, after he launched that racist Web site with its long hate-filled manifesto, he used the money from his 21st birthday in April to guy a gun. Then he began a twisted tour of South Carolina historic sites connected to slavery and the confederacy and then last week's massacre in Charleston.

But instead of the race war he said he hoped to spark, the shooting seems to set to change the political climate across the South. Later this, morning a rally is planned at South Carolina statehouse calling on lawmakers to support removing the Confederate battle flag from the premises. It comes after South Carolina Governor Nikki Haley reversed her earlier position and joined both of the state's U.S. senators, calling for the confederate battle flag's removal.

[04:35:01] This as the speaker of the Mississippi House says he wants to see the Confederate cross removed from his state's flag.

Let's get more on this from CNN's Ana Cabrera in Charleston.

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ANA CABRERA, CNN CORRESPONDENT: John and Christine, the Confederate flag still flies out front of the South Carolina capitol. But now, the governor, Nikki Haley, is joining calls for the flag to go. And this sets up a debate that will likely play out in the next few weeks inside the state capitol, and with an eventual vote by state lawmakers which will determine the flag's future.

But the governor's announcement just reverses what she said in previous statements in which she supported the placement of the flag here, in state capitol grounds, alongside the Confederate war memorial, saying it symbolizes the state's heritage. But she says, in light of the Charleston church massacre, she recognizes that this flag means different things to different people. And for some, it symbolizes hatred and racism and she says that has no place on state capitol grounds.

GOV. NIKKI HALEY (R), SOUTH CAROLINA: For good and for bad, whether it is on statehouse grounds or in a museum, the flag will always be a part of the soil of South Carolina. But this is a moment in which we could say that that flag, while an integral part of our past, does not represent the future.

Today, we are here in a moment of unity in our state without ill will to say it's time to move the flag from the capitol grounds.

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CABRERA: Bottom line, only state lawmakers have power to remove the flag, and it will require a 2/3 majority to agree for the flag to come down. There does seem to be some momentum going in that direction but we'll have to wait and see -- John and Christine.

(END VIDEOTAPE)

ROMANS: All right. We will. Ana Cabrera, thank you for that in Charleston.

Walmart is removing all Confederate flag merchandise from its stores. Walmart.com has carried the flag, as well as attire featuring the flag, like t-shirts and belt buckles. But now, the country's largest retailer says it doesn't want to offend anyone by selling these products.

Some other major retailers still sell Confederate flag merchandise, including Amazon and eBay. But flag manufacturers are also discussing amongst themselves whether they should be manufacturing these symbols some use as racial symbols of hate.

Now, quick check of the markets. Stocks have never been this high. European and Asian stocks, much higher this morning on hopes of a Greek debt deal. U.S. stock futures are up, too. Good day yesterday, the NASDAQ, record high close. The Dow gained 104 points.

BERMAN: President Obama is now set to travel to Charleston. That will happen on Friday. The president, the first lady, and Vice President Joe Biden will attend the funeral for the pastor of Emanuel AME Church, Reverend Clementa Pinckney.

CNN's Michelle Kosinski has the latest from the White House -- Michelle.

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MICHELLE KOSINSKI, CNN WHITE HOUSE CORRESPONDENT: Hi, John and Christine.

Right. It was interesting to hear, after so many questions have been directed to the White House, when is the president -- is he going to visit Charleston? Now, they've announced that he and the first lady, and the vice president will be going there on Friday for the funeral of Reverend Clementa Pinckney, someone the president had met and knew personally. And the president will deliver the eulogy.

It almost seems like we're in this new period of how the president engages on and addresses race. I mean, we've heard several speeches lately where he uses extremely direct language. Speaking of which, this hour-long interview that he did with a comedian in a garage for a podcast called "WTF", the headline, of course though, that the president himself used the N-word.

BARACK OBAMA, PRESIDENT OF THE UNTIED STATES: And it's not just a matter of it not being polite to say nigger in public, that's not the measure of whether racism still exists or not. It's not just a matter of overt discrimination. We have -- societies don't overnight completely erase everything that happened 200 to 300 years prior.

KOSINSKI: Well, clearly, there is a shock value in that. That's the headlines around the world.

But the White House is denying that the president planned this out ahead of time. They said he was simply making a point in an informal setting and it just kind of came out. Some analysts are saying it is about time we heard the president speak so directly on the subject.

Of course, not everybody's happy that he decided to use that word in particular, but we're also hearing from people who are saying they're surprised that people are surprised. I mean, this is a word we don't feel comfortable using really when we're talking about that word, but it's hard to imagine that the president didn't think about the provocative power of it when he decided to use it even if it was on the spot. And this kind of discussion is clearly what the White House wants -- John and Christine.

(END VIDEOTAPE)

ROMANS: All right. Michelle Kosinski, thank you for that.

Four Republican presidential candidates scrambling this morning to distance themselves from the head of a white supremacist group who might have inspired Charleston church shooter Dylann Roof. Earl Holt, the leader of the Council of Conservative Citizens, has donated thousands of dollars to the campaigns of Ted Cruz, Rand Paul, Scott Walker, and Rick Santorum.

[04:40:07] Three of the four candidates announcing they will donate those contributions to the Mother Emanuel Hope Fund in Charleston.

BERMAN: A top executive from Japanese airbag maker Takata will be on the hot seat at Senate hearing today. The company is involved in the largest automotive recall in history, with at least 32 million vehicles affected. Faulty airbags are responsible for at least eight deaths. A report just published by the Senate committee claims Takata executive actually halted safety audits worldwide during the recall in order to save money.

ROMANS: The president's fast track Pacific trade bill faces one more critical hurdle in the Senate today. It's a procedural vote that could clear the way for final passage this week. The fate of the bill is in the hands of half a dozen Democrats who are pro-trade, they say, but have concerns that the deal will kill jobs in America.

BERMAN: The cyber attack targeting millions of U.S. federal workers is much bigger than anyone thought -- 18 million workers, their private/personal information stolen. Who is behind the data breach? We're live, next.

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BERMAN: It appears the cyberattack targeting federal employees is much more far reaching than first thought. The number of employees affected has gone from about 4 million to about 18 million, and that number will likely go up even higher. The U.S. is pointing the finger at China, but what does China have to say?

[04:45:01] I doubt they're admitting to much.

Let's turn to CNN's David McKenzie in Beijing for that.

Good morning, David. DAVID MCKENZIE, CNN CORRESPONDENT: Good morning, John.

No, they are not admitting it, as they haven't done in several years. And, in fact, this time, these allegations -- they are saying, well, they are, in fact, irresponsible by the U.S. and that, in fact, it's the U.S. fault that the talks between China and the U.S. have broken down on the issue of cyber security.

Look, we haven't had much detailed information from the officials in the U.S., outlining exactly how they know this was China doing this hack which allegedly got more than 18 million prospective, current, former federal employees, access to their personal information and importantly, access to those trying to get security clearance for federal agencies.

Now, China has said it is itself a victim of hacking and they say often that hacking comes from the U.S. -- John.

BERMAN: And what exactly would this information be used for and what branch hypothetically speaking, since they're not admitting to it, of the Chinese government would have their hands on it?

MCKENZIE: Well, it would ultimately be an intelligence gold mine potentially, but it's a multistate process. Whoever gets it, whether it's a state actor, private syndicate of hackers, or anyone else because they get all of their information first to create what officials say could be a vast database of sensitive information, and then they can use that information to target specific high value individuals by potentially sending them fake e-mails, so called phishing attacks. If those people then click on that, they can access even more valuable data and sensitive issues.

Now, of course, there's been a lot of grumbling particularly on Capitol Hill about the level of security that the U.S. federal agencies have had around that information. I'm sure that will be tightened now, but there is a sense that this huge treasure trove of information could be used for more damaging attacks in the future -- John.

BERMAN: All right. David McKenzie for us in Beijing -- thanks so much, David.

ROMANS: Maryland Governor Larry Hogan revealing he has a very advanced form of cancer. The 59-year-old Hogan has been diagnosed with non-Hodgkin's lymphoma. He says he will not step down. He intends to keep working while receiving chemotherapy treatment in the coming months. Now, although the cancer has advanced, Hogan says his chance of survival is strong.

BERMAN: Six Baltimore police officers charged in the death of Freddie Gray will go on trial October 13th. The 25-year-old Gray died back in April after suffering a spinal injury while in police custody. His death triggered widespread protests in Baltimore. The charges against the six officers range from second degree manslaughter and assault to false imprisonment and misconduct. ROMANS: The New York city mayor and city council striking a budget deal that calls for the hiring of nearly 1,300 new police officers. Mayor Bill de Blasio says some of those officers will be part of a new neighborhood policing strategy. Others will be assigned to a dedicated, specially trained counter terrorism force. The influx of new officers is expected to address bloated police overtime costs. The increase will take the NYPD to 37,000 officers, by far, the largest police force in the country.

BERMAN: FBI investigators are still trying to determine exactly who in the St. Louis Cardinals front office was behind the hacking of the Houston Astros computer network containing a lot of their baseball intelligence. Officials say the focus on a small group of Cardinals employees. One of the breaches was traced to a computer in a residence near the Cardinals spring training complex. At least four members of the baseball operations staff purportedly hired criminal defense lawyers.

ROMANS: Wow.

BERMAN: Wow, indeed.

ROMANS: That is something.

BERMAN: You can't deflate a baseball, all I'm saying.

ROMANS: I can assure you the Chinese were not behind that particular hack.

BERMAN: You know, who knows at this point.

ROMANS: That's interesting.

All right. Severe storms destroying homes overnight. It's not over yet. The damage done and the millions facing new storms, folks, this morning. That's next.

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BERMAN: Tornadoes tore into the Upper Midwest overnight. A twister that hit Cole City, Illinois, reportedly sparked fires and left people trapped inside collapsed buildings. In Illinois, west of Chicago, emergency officials say damage to a major campground is catastrophic. But they have been able to rescue five people who were trapped inside trailers.

Now, in eastern Michigan overnight, a tornado did severe damage in the town of Millington, toppling trees and tearing apart houses there. Crews are still in rescue mode in that town. Another twister slammed into Portland, Michigan, ripping roofs off of homes and churches, collapsing a goodwill store there. Five people injured when it touched down Monday afternoon.

ROMANS: Wow, this is still a dangerous situation, because that severe weather is moving into the Northeast today.

Meteorologist Pedram Javaheri is tracking that weather for us from the CNN weather center.

PEDRAM JAVAHERI, AMS METEOROLOGIST: John and Christine, good morning to you.

Yes, look at the active weather in the Midwest, finally beginning to taper off a little bit, of course, into the early morning hours. We've lost some of the heating that really causes these storms to blossom. And that is good news. Still spawning some 13 reports of tornadoes, a lot of them centered over Illinois, portions of eastern Michigan.

The concern is the storms moving into areas of the Northeast and by this afternoon it could be putting major cities in line for active weather. The thunderstorms, the models really pushing in toward D.C. by, say, 3:00, 4:00 in the afternoon. New York and New Jersey certainly get in on the action as well. But nearly 70 million people in line for some active weather.

And the largest threat, the enhanced risk stretches from New York, to Philly, and Boston AS well. Damaging winds, large hail -- of course, can't rule out tornadoes. You know, this line of active weather has had the history of putting a few down. We'll watch that.

Heat indices into the mid to upper 90s, portions of D.C. getting up to 103 degrees by this afternoon, what it will feel like, 107, the heat index across Charleston and Atlanta gets up to 100 degrees. The pattern changing as far as the front moving through, yes, it will bring in active weather. The good news is once it passes, a pretty marked cooling trend on the forecast across the northeast -- guys.

ROMANS: All right. Pedram, thank you for that.

OK. Who knew there would be controversy on putting a woman on the $10 bill. A former fed chief is appalled by the treasury secretary's decision. We got that next.

BERMAN: Like a huge Hamilton --

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[04:58:24] ROMANS: I'm Christine Romans. Let's get an early start on your money this morning.

Looks like another good day on stocks, folks. European and Asian stocks are much higher right now. U.S. stock futures are up after a great day yesterday. NASDAQ, in case you're wondering, record close there and it's all largely thanks to a potential Greek debt deal. For the first time in months of negotiations, Greece's creditors suggest a last-minute deal to avoid default is in sight. We hope it holds.

Ben Bernanke is appalled by the treasury's plan to add a woman to $10 bill. Now, the former Fed chair says he's behind Secretary Jack Lew's goal of putting a woman in a bill. But it shouldn't come at Hamilton's expense.

BERMAN: Someone's going to stand up for Hamilton. ROMANS: It's really going to hurt his feelings.

Bernanke says Hamilton was the best economic policymaker in U.S. history, helping stabilize the financial system in America's early days. He suggests revamping the $20 instead, calling Andrew Jackson a man of many unattractive qualities and a poor president.

You know, the movement, the lobby to put a woman on the bill was for the $20 bill. Now they've come back and the Treasury Department is asking. Find the hashtag.

BERMAN: Where were all these people who are now speaking out on behalf of Alexander Hamilton? Where have they been for the last several decades? I have not seen the massive amount of support for the former treasury secretary until now. That's all I'm saying.

There are better things. There are better things to be upset about, Ben Bernanke.

All right. EARLY START continues right now.

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ROMANS: New clues and new tips this morning bringing investigators ever closer to two killers who escaped from prison, where officials think they are now hiding, ahead.

BERMAN: New calls this morning to banish the Confederate flag. South Carolina's governor wants the controversial battle flag removed from the state capitol there. Now, there are calls in Mississippi, even Walmart getting in on the action.