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Early Start with John Berman and Zoraida Sambolin

Captured Inmate Reveals Escape Plan; Greece Financial Crisis: Deadline Approaches; Obama to Expand Overtime Pay. Aired 4-4:30a ET

Aired June 30, 2015 - 04:00   ET

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

[04:00:14] CHRISTINE ROMANS, CNN ANCHOR: New information on how two killers escaped from prison and where they were headed. Captured inmate David Sweat is talking, opening up to investigators about their plan and what went so wrong.

JOHN BERMAN, CNN ANCHOR: U.S. stocks posting their worst day of the year. Europe in crisis, with just hours to figure out how to fix this mess. We are live.

ROMANS: And breaking overnight: the president with a plan to boost paychecks for millions of Americans. We're talking about overtime pay, a big expansion there. This really matters to a lot of workers.

Good morning and welcome to EARLY START. I'm Christine Romans.

BERMAN: Good to see you. I'm John Berman. It is Tuesday, June 30th, 4:00 a.m. in the East.

And happening right now: a prison escapee, he is talking. The one surviving convict who broke out of the maximum security prison is now answering some questions from investigators. Thirty-five-old David Sweat is in a secure unit at the Albany Medical Center being treated for two gunshot wounds suffered during his capture. He has been upgraded from critical to serious condition.

And now, Sweat is revealing new details about how he and Richard Matt escaped, their plans to flee with prison employee Joyce Mitchell and how it all went, from their standpoint, horribly wrong.

CNN's Alexandra Field has the latest.

(BEGIN VIDEOTAPE)

ALEXANDRA FIELD, CNN CORRESPONDENT: Christine, John, a New York state police sergeant shot David Sweat in this field, just two miles south of the Canadian border. He took two bullets to the torso, but he's already talking to investigators about his plans to cross a d different border. Sweat now tells officials that he and Richard Matt planned to travel with Joyce Mitchell to Mexico. But they had to turn to plan b when she failed to show up with the getaway car the night the convicted killers escaped from that maximum security prison.

Sweat is also telling officials that he and Richard Matt separated five days before Matt's death. The older escapee was slowing him down.

Sources close to the investigation have told CNN that Richard Matt's body smelled heavily of alcohol after being shot and killed on Friday afternoon. They say they have also found evidence showing that he was suffering from illness, possibly from contaminated food or water -- Christine, John.

(END VIDEOTAPE)

BERMAN: All right. Alexandra, thanks so much.

New information revealed by David Sweat might be good news for corrections officer Gene Palmer. Palmer is charged with aiding the escape by passing frozen hamburger meat to the inmates. It turns our there were hacksaw blades hidden inside that meat.

The officials now say David Sweat has told investigators that Palmer was not involved in the escape, that he didn't know about the blades in the meat, and that the plot involved only Sweat, Matt and Joyce Mitchell. She was the woman who worked in the tailor shop. Even so, officials believe others may have had a hand in the escape, if only unwittingly.

(BEGIN VIDEO CLIP)

SHERIFF KEVIN MULVERHILL, FRANKLIN COUNTY, NY: For as intelligent as these guys are, breaking out of the maximum security prison, evading police for three weeks, Joyce Mitchell was plan A. I think there's probably going to be others that are implicated, that may or may not know they played a role in this. You know, some small thing that somebody did for them, you know, when you add those all up, it's kind of like building a wall. You know, everybody provided a brick, so to speak, until their plan was complete.

(END VIDEO CLIP)

BERMAN: All right. New this morning, in the aftermath of the mess really of the Clinton correctional, the FBI is launching a federal investigation. Agents are probing possible corruption and drug trafficking by prison employees. Officials briefed on the inquiry tell CNN that investigators are looking into whether the escapees were involved with the alleged drug trade and enjoyed greater freedom on the honor block because of that.

ROMANS: All right. European stocks are lower right now. Greece heading for default. After months of negotiations went nowhere, Greece cannot make a $1.7 billion payment to the IMF due today. Greece's existing bailout program officially expires today. Lenders have refused to extend it until after referendum vote on Sunday.

Now, the big crisis is posing a threat to the global economy. Fears of contagion, of a ripple effect in Europe, especially in some of these weaker southern European economies. Greece is hurtling toward an exit from the eurozone, a move that is unprecedented.

All that uncertainty triggering a selloff yesterday, folks. Stocks in the U.S. had their worst day in years. The worst drop in a couple of years. The Dow right now, U.S. futures are a little bit higher right now. Asian shares are bouncing back a bit from yesterday's losses. But European stocks are lower this morning.

The Greek prime minister is urging voters to stand behind him and reject the European bailout proposal at the ballot box. A referendum on the proposal is set for Sunday. The prime minister is hinting that he will resign if the voters decide to accept what he calls an insulting ultimatum from Europe, and the continued austerity that goes with it.

[04:05:00] European leaders say a no vote will effectively forced Greece out of the euro, something polls show most Greeks do not want. This is a real bind that Greek citizens find themselves in, a real bind and world markets basically held hostage until Greece figures out what it's going to do next.

I want to bring in CNN's Isa Soares live in Athens for us.

Now, yesterday, when we spoke with you 24 hours ago, the banks were closed, the ATMs were only beginning to start to open. How are Greek citizens feeling this morning, Isa?

ISA SOARES, CNN INTERNATIONAL CORRESPONDENT: Pretty much of the same. Very good morning to you, Christine. You know, it's early morning here in Greece. A lot of people already cueing up to get those 60 euro.

Pensioners are slightly more confused because they were told they were supposed to get pensions on Monday. They showed up. There was no pension. Then, they were told to come today.

Being unable to get money out, I spoke to one lady who tried ten times to get 60 euro from her pension. She was unable to do it and now being told by a government official that the pensions will be open tomorrow for pensions, so pensioners could get their money.

But this is, as you said, a critical day for Alexis Tsipras. Global stock markets are falling. European markets are taking a tumble last time I look. Now, it is time for Alexis Tsipras to decide, will he or won't he pay that the 1.6 billion euros, $1.6 billion to the IMF?

Already, we have heard late last night from Greek's economy minister who said very, very defiantly on CNN that he will -- Greece will not pay the IMF. In the same token, we heard from Alexis Tsipras, very defiant on national television last night, basically, you know, how can we pay the IMF when we don't have any money ourselves? He said, his words were economic asphyxia, the country has gone through.

But still, he kept saying there will be an olive branch. In the last two hours, a European commission source has told CNN they put -- they tabled an offer to Greece late last night. We do not know what the offer is. But if we listen to what Tsipras said last night, he's still asking people to vote no against these proposals.

ROMANS: We don't know, Isa, what that offer is, but we do know that there's been talk or speculation that maybe stretching out the lengths of these loans or lowering interest payments or somehow refinancing them. You talk about pensioners, and I think in this country, in particular, it's sort of interesting.

One of the problems for Greece here is so many of its citizens retired, you know, in their mid-50s, a retirement age that has been promised to them. And they are paid by the government. They get government money that goes at this point is coming right from the ECB, the European Central Bank, and going right into the pocket of pensioners.

Part of their austerity would mean people taking less money, they already have been, and working longer and paying higher taxes. And that's something that just doesn't fly with the Greek citizens.

SOARES: Absolutely, it just doesn't fly. What they want Europeans are asking for is to raise the retirement age. We heard from the European commissioner, he said we're not asking for more pension cuts, that's what he said. All cuts to wages, this is what he said in the last proposal. But they want the retirement age to increase.

People retiring roughly at 50 or so. But they have also started much earlier, working earlier in agriculture. I met a gentleman who started working when he was 16. So, a lot of them they say to me, there is a cultural difference.

When you think of the rest of the Europe, the periphery countries, those who have been bailed out, those made these austerity cuts, Portugal, Spain, Ireland, said if we can make it, if we have to our, you know, retirement age, surely Greece also has to do it -- Christine.

ROMANS: And that's what you hear from the European officials, too. They have seen bailout programs for some of these other Southern European countries have taken their medicine. Greece has not and fighting to the bitter end.

OK. Isa, we will talk very, very soon. Keep us posted as we watch as that deadline approaches.

Greece isn't the only place facing the huge death crisis this morning. Officials in Puerto Rico, they say there is no way the U.S. commonwealth can repay the $73 billion it owes. The government run energy company, PREPA, has a debt repayment due on Wednesday. It is likely going to default on that debt payment. The island's governor asking Congress for authority to declare chapter 9 bankruptcy the way Detroit did when it went belly up.

One of the biggest financial issues of the next decade, John Berman, will be too many promises and too much debt and not being able to deliver on those promises around the world.

BERMAN: He says it is not a problem with politics, he says it's a problem with math in Puerto Rico. There's not a money there to pay for it.

ROMANS: A death spiral, he said, that country is in financial --

[04:10:02] BERMAN: At ten minutes after the hour right now.

President Obama set to announce a major move that the White House says will boost salaries for millions of Americans. He will launch changes to overtime rules, more than doubling the minimum salary level to qualify for overtime pay. The threshold is now $23,000 a year. It will rise to about $50,000. If you earn less than $50,000, once the rules in effect next year, you will get overtime if you work more than 40 hours.

ROMANS: This is a very, very big deal.

All right. NBC Universal is cutting ties with Donald Trump, citing derogatory statements during his presidential campaign kickoff announcement. It was Trump referred to Mexican immigrants, some of them as rapist, drug dealers and criminals. The company will no longer air the Miss USA and Miss Universe pageants, which had been a joint Trump -- joint venture with Trump and the company will explore ways to continue "Celebrity Apprentice" without him.

Trump fired back, calling NBC weak and standing by his comments.

(BEGIN VIDEO CLIP)

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: I have a great relationship with Mexico. How can I not love people that give me tens of millions of dollars for apartments? You have to love them.

My stance on immigration is correct. And some people may not think so, but ultimately, my stance is correct.

(END VIDEO CLIP)

ROMANS: That stance, just to refresh your memory, I mean, it was just a couple of weeks ago, where he said we must close the borders. A country cannot be a country unless you close the borders to -- and he said Mexico is sending in --

BERMAN: Criminals and rapists.

ROMANS: -- criminals and rapists. It was very, very pointed. We will pull up that sound, we can play it again.

Today, Trump will be back in New Hampshire where a CNN poll places him second among the Republican presidential candidates.

BERMAN: I'm going to continue to not watch Miss University.

A big announcement today on the Republican side. New Jersey Governor Chris Christie set to officially enter the race. After teasing the U.S. with a campaign video and the slogan, telling it like it is, he will make the announcement this morning in his hometown high school in Livingston, New Jersey. Christie will then head to New Hampshire, pretty much stay there for the rest of the week. He's got a New Hampshire or bust strategy going forward.

ROMANS: All right. The State Department plans to release a new set of e-mails today from Hillary Clinton's tenure as secretary of state. Officials are not saying how many will be released. The first round of 300 were made public last month, offering a glimpse of her handling of the Benghazi attacks. Clinton turned over roughly 30,000 e-mails from her private server which she used almost exclusively to conduct both private and government business when she was secretary of state.

BERMAN: At 12 minutes after the hour, July 4th terror threat. The White House on record that new fears that ISIS could attack.

ROMANS: Plus, new arrests in an ISIS-inspired hotel massacre. We are live with new information on that this morning.

(COMMERCIAL BREAK)

[04:15:45] ROMANS: Welcome back.

Federal officials are warning the threat of the Islamist terror is the highest it's been in years. The FBI has ramped its surveillance of some suspects and bolstered counterterrorism efforts to combat radicalization of young people online. This as the White House addresses concerns about the possibility of domestic terror attacks by ISIS over the Fourth of July holiday.

(BEGIN VIDEO CLIP)

JOSH EARNEST, WHITE HOUSE PRESS SECRETARY: There is no specific credible intelligence to indicate any threats against celebrations over the Fourth of July weekend. However, we have repeatedly seen calls for violence over the past year by the leadership and supporters of ISIL, against members of the military and military installations, law enforcement, the U.S. government and the American public.

(END VIDEO CLIP)

BERMAN: New this morning, authorities in Tunisia have announced a number of arrests in connection with Friday's terror attack on a popular beach hotel. The arrests are part of a nationwide manhunt for accomplices. ISIS is claiming responsibility for the attack, which killed 58 beach goers. A majority of the victims were from the United Kingdom.

British Prime Minister David Cameron has promised a full spectrum fight against extremism in his country and beyond.

CNN international correspondent Nick Paton Walsh is in Sousse, that is in Tunisia, where that hotel is, with the very latest.

Good morning, Nick.

NICK PATON WALSH, CNN SENIOR INTERNATIONAL CORRESPONDENT: John, it's still a complex picture as to where exactly Saif al-Rezgui learned the militancy and the hatred to kill those 38 tourists as they gunned them down in their swimwear at the Imperial Marhaba Hotel.

But this morning, we have a slightly clearer picture. The Tunisian authority saying they believe he was, quote, "linked" to a Libyan terrorist group. Some of that goes without saying, given Libya is a war torn country next door to Tunisia. They think it may be one group that's had al Qaeda links in the past, Ansar al Sharia, or it could be ISIS. ISIS claimed this attack as being theirs, released a picture of the gunman, along with that claim.

But it's still unclear if Tunisian authorities buy into that idea. We know the gunman in the amateur video you saw is seen throwing his telephone in the sea. That has helped authorities with their inquiries. At this stage, they arrested three roommates. They believe perhaps some of his fellow students at university may have been involved in the path to radicalization.

But, importantly, too, while they are also combing through his laptop and documentation they took from his family home, they think actually he was radicalized online most likely. That is the Internet gave him the ideology or the know how to carry out that attack. Now, that's important because it perhaps means it is less likely to travel across the border into Libya to learn some of these skills.

But those questions have to be answered quickly, John, because this beautiful beach behind me is part of the coastal resort that is so desperate for tourism for its livelihood. And until holiday goers think they have the answers to those questions, they're going to be reluctant to go back here -- John.

BERMAN: And, Nick, what new security measures is that nation putting in place to protect tourists? Tourism is so essential to that economy.

WALSH: And that's the real dilemma here, because do you actually encourage tourists by putting armed guards at every 10 meters along a beach? That is a question you have to ask yourself as a tourist destination. We're seeing dune buggies roaming along here with armed guards on them. There are armed guards at some of the roundabouts here, police and military.

It is not overwhelming. Imagine the U.S., the lockdown happening after this. There is no sign of that. It is low key. We may see in the days ahead, potentially, we may see more gun man around here -- police or army I should say, trying to boost security at hotels.

It is not part of every day life. The question is, will it become so? And what will do that do to the number of people who come to these beautiful beaches? John?

BERMAN: Serious question. Nick Paton Walsh for us in Tunisia -- thanks so much, Nick.

ROMANS: All right. A New Jersey man under arrest after allegedly plotting to help ISIS. Authorities say Alaa Saadeh planned to travel overseas to join the terrorist group. They say the 23-year- old also bought a plane ticket for his brother to join ISIS. His arrest comes less than two weeks after law enforcement arrested another New Jersey resident on similar charges.

BERMAN: The Supreme Court has wrapped up its terms with a flurry of decisions, including one upholding use of a controversial execution drug. The justices ruled against three death row inmates who challenged the use of the drug Midazolam, claiming it caused excruciating pain.

[04:20:06] Those what the inmates claimed.

The court said the inmates failed to identify an available and preferable method of execution and also did not prove the use of the drug amounts to cruel and unusual punishment.

ROMANS: All right. Breaking overnight, Iran sending its top officials to the nuclear talks. It's a last minute push for some kind of breakthrough on deadline day. We go live to Tehran with the very latest.

(COMMERCIAL BREAK)

ROMANS: The U.S. giving no ground this morning on a nuclear deal with Iran. American negotiators in Vienna rejecting what they see as attempts by Iran's Supreme leader to backtrack on the agreement reached last April in Switzerland. Today is the official deadline to reach a deal. But both sides are saying they will extend the talks on a short term basis.

Iran's foreign minister, Mohammad Javad Zarif, has just arrived in Vienna, returning to the talks.

I want to bring in CNN's Nic Robertson. He is there live with the latest this morning.

And, Nic, walk us through the back tracking. It's about new development of nuclear technology. What is this glitch and how could it derail things here?

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes, the glitch surfaced over a week ago when Iran's supreme leader said he would not go along with what was agreed three months ago in Switzerland, the Lausanne agreement, that said that Iran would have to hold off on its nuclear research and development for about 10 to 12 years. This is really to slow its advancement to nuclear technology that will allow it to break out and make a weapon faster, that was why, that was (INAUDIBLE)

[04:25:06] He also said that he wants immediate lifting of sanctions. There are many different sanctions and there are many different countries, and it is likely that may end up being agreed in a phased approach. And he is also said and this is perhaps the most controversial thing that the International Atomic Energy Agency, which is the nuclear watchdog that will enforce, if you will, or check's Iran's complaints with whatever it disagrees to, by inspecting nuclear sites and other sites in Iran, the supreme Iran in leader said, look, military sites are off limits. Well, that's not what was agreed three months ago in Switzerland.

So, when we hear from the Iranian foreign ministry who just arrived and is due to meet with Secretary Kerry in a few minutes, what he says will be the biggest clue, because Secretary Kerry and others from the State Department here have been very clear. Everything that they agreed in Switzerland stands and holds, and the Iranians can't be ruling it back. They are saying that, look, we believe we can get agreement. But, really, until they hear from Zarif, they are saying we don't know if that is still possible. They believe it can be and but a lot obviously depends on Iran, Christine.

ROMANS: A lot depends on Iran, and, Nic, quite frankly, you have the table full of people. They have to sell the deal. If they get a deal, they have to sell it at home, too. They're all these complicating politics.

ROBERTSON: Oh, absolutely. And part of what we're hearing in the discussions that go on, you know, when they talk about the monitoring of nuclear sites in Iran and access to military sites. There is real detail discussion that you can see could stand scrutiny of detailed questioning by Congress and by others. And the details that Iran would have to agree to additional protocols, which would allow the nuclear watchdog to get into those military sites, and if there were contested issues about some sites, then that could go through a managed process. But there would be time limits on that managed process.

It's the duration of the time limits discussed and debated here. So, the sort of strength and robustness of how this can be sold to Congress and others is still, you know, the subject of the discussions here. But you can see a route where this can be achieved.

But you can also see a route here if you listen to the Iranian side of this, their supreme leader, that you just can't make that agreement, because he's not going to give ground on it.

ROMANS: All right. Nic Robertson for us this morning in Vienna -- thank you, Nic for that.

BERMAN: All right. New details this morning on the New York prison break. The captured killer telling investigators how they escaped and from his vantage point what went wrong. That's next.

(COMMERCIAL BREAK)