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U.S. Sanctions Russia Over Elections; Russia Expected to Retaliate; Ceasefire Begins Across War-Torn Syria; New Year's Eve Security; Arkansas Player Banned from Belk Bowl for Shoplifting. Aired 5-5:30a ET

Aired December 30, 2016 - 05:00   ET

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

JOE JOHNS, CNN ANCHOR: Happening now, the Russians finalizing response to unprecedented sanctions leveled by the White House over the election hack. How will Moscow fight back? We're live in Russia.

ALISON KOSIK, CNN ANCHOR: A new cease-fire finally taking effect in Syria after more than five years of bloodshed. Is the pause enough to get the sides talking about a lasting peace? We're live in the Middle East.

JOHNS: And they are getting ready to party in Times Square. Less than 48 hours to the big ball drop, security is being stepped up ahead of the New Year's Eve celebration. We will tell you what steps are taken.

Good morning and welcome to EARLY START. I'm Joe Johns.

KOSIK: Good morning. I'm Alison Kosik. It's Friday, December the 30th. It's 5:00 a.m. in the East. John and Christine are off.

And this morning, we are waiting to see what steps the Russians plan to take.

[05:00:03] They are vowing to retaliate likely today for the sanctions President Obama has just laid down, punishing Russia for election hacking.

The White House announcing punitive measures against four individuals and five entities, all connected to a Russian intelligence, and also expelling dozens of diplomats. The U.S. sanctions drawing condemnation both from the Russian government and the president-elect.

Donald Trump again downplaying the election hack, but he has a new twist. Here is the latest statement. "It's time for our country to move on to bigger and better things. Nevertheless, in the interest of our country and its great people, I will meet with leaders of the intelligence community next week in order to be updated on the facts of the situation."

A top Trump aide is dismissing the sanctions as toothless and aimed at limiting the president-elect's options as much as punishing Russia. Here is Kellyanne Conway on CNN. (BEGIN VIDEO CLIP)

KELLYANNE CONWAY, SENIOR TRUMP ADVISER: These retaliations, these sanctions put forward by President Obama and his administration, some of them seem largely symbolic. Even on those who are sympathetic to President Obama on those issues are saying that part of the reason he did this today was to, quote, "box in" President-elect Trump. That would be very unfortunate if that were the motivating -- if politics were the motivating factor here. But we can't help but think that that's often true.

(END VIDEO CLIP)

KOSIK: CNN's Athena Jones is with President Obama in Hawaii. She has more on the sanctions.

(BEGIN VIDEOTAPE)

ATHENA JONES, CNN CORRESPONDENT: Good morning, Joe and Alison. The president is calling these steps necessary and appropriate and said they are coming after repeated private and public warnings to the Russian government.

He said all Americans should be alarmed by Russia's actions and he repeated his previous assertion that these activities could only have been directed by the highest levels of the Russian government. Now, what are the steps the U.S. has taken?

The Treasury Department has named nine entities and individuals who are now going to be subject to expanded sanctions. Those include Russia's military intelligence unit and its chief, as well as the domestic security service. The State Department is declaring 35 Russian intelligence operatives persona non grata and giving these spies 72 hours to leave the country.

The government is also shutting down two Russian government-owned compounds. One in New York and another on the eastern shore of Maryland not far from Washington, D.C. The White House says that Russia should not be surprised by these actions and they're stressing that the announced moves are not, quote, "the sum total of our response."

The U.S. is also taking covert measures, all of this aimed at delivering one message to Russia, that there are costs and consequences for their actions.

Back to you, guys.

(END VIDEOTAPE)

JOHNS: Athena Jones in Hawaii.

The U.S. sanctions include two Russian hackers who have been on the FBI's most wanted list for years. Evgeniy Bogachev and Aleksey Belan are both wanted for large scale theft of money and personal identifying information. Both men are fugitives. Their whereabouts unknown.

The administration backing up the sanctions with the release of a report from the FBI and Department of Homeland Security. It lays out unclassified technical details explains how federal investigators linked Russian intelligence agencies to the hack of the DNC and Clinton campaign manager John Podesta. The report says the Russian cyber attacks have been code named Grizzly Steppe.

Meantime, as we wait for word of Moscow's retaliation for the U.S. sanctions, Russia has already launched a few early actions, including this insult via Twitter from the Russian embassy in London. "President Obama expels 35 Russian diplomats in Cold War deja vu as everybody, including the American people, will be glad to see the last of this hapless administration." You can see there, the cute picture of a lame duck or a duckling, actually.

For the latest from Moscow, let's now bring in Matthew Chance.

Good morning.

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Good morning, Joe.

There's been this scathing response. I was looking at a tweet, a verbal response from Dmitry Medvedev, who is the Russian prime minister, saying it's regrettable that the Obama administration, which started out by restoring our ties is ending its term in the anti- Russian agony. The letters RIP.

And that fits with the venomous rhetoric and condemnation that we have seen from Russian officials over the course of the past 24 hours and even longer than that when it comes to the outgoing Obama administration. The Russian foreign ministry spokeswoman Maria Zakharova posted this on her Facebook page shortly after the sanctions were announced, "The Obama administration is a group of vindictive, unimaginative foreign policy failures", she said.

And so, a very angry response their verbally at least from the Russian authorities in response to these sanctions and the expulsion of 35 diplomats.

In terms of concrete measures, though, about what the Kremlin is going to do, we have not got any yet.

[05:05:00] But the Kremlin says there will be reciprocal measures. That, of course, indicates that Russian, that U.S. diplomats based in Russia could also face expulsion as well.

One caveat I put on that, Joe, is that Russia knows very well that in three weeks from now or less, Donald Trump is going to be taking over in the White House. He's got a very different attitude it seems towards Russia, much more sympathetic to the Russian point of view. He is a president or a man that the Russians believe they can do a deal with. So, that may restrain them somewhat from taking the strong action they might otherwise have taken if there weren't a change of presidents in the United States, Joe. JOHNS: OK. Thanks for that, Matthew Chance in Moscow.

KOSIK: And helping us break all this down, we got political analyst and best selling author Ellis Henican with us. His recent work, appropriately enough, includes "How to Catch a Russian Spy."

Good morning to you.

ELLIS HENICAN, POLITICAL ANALYST AND BESTSELLING AUTHOR: Relevant again.

KOSIK: It is.

HENICAN: Thank you.

JOHNS: Always relevant.

KOSIK: Yes, we definitely need your expertise on this. But what's interesting, almost as soon as President Obama lay down this punishment, these sanctions on Russia came the talk of whether they'll stick once President-elect Obama is out of office?

So, we had the Obama administration officials speaking out about this. Lisa Monaco for one. Listen to what she said.

(BEGIN VIDEO CLIP)

LISA MONACO, OBAMA HOMELAND SECURITY & COUNTERTERRORISM ADVISER: The reversal of sanctions such as what you've described would be highly unusual. Indeed, the sanctions usually remain in place until the activity and the reasons for them being imposed in the first place has been removed.

(END VIDEO CLIP)

KOSIK: So, since all the talk about President Obama looking to sanction Russia, you know, Donald Trump has been dismissive of the intelligence community, although am I wrong to interpret, I'm saying a thawing of this. Reince Priebus was on FOX yesterday saying, we can talk to all of these intelligence agencies and find out once and for all what the evidence is there. How bad is it?

So, I interpret that is show me the evidence and we'll act. So, why doesn't the intelligence agency show them the evidence?

HENICAN: The intelligence agency standing by eager to show them. I did note that president-elect Donald Trump said he would be available next week to get briefed. It is fascinating. You are right. It would be unusual to reverse sanctions like this. But don't you think this year is a little unusual?

JOHNS: What does Putin do? This is a chess game.

HENICAN: High fives is what he's doing.

JOHNS: Absolutely. HENICAN: He's happy.

JOHNS: The United States has taken its action, sent all these people out. Does he just sit and wait or does he wait for Trump?

HENICAN: Well, I think you are watching the moves. Some is rhetorical. Who knew by the way the Kremlin tweeted and used Facebook so energetically?

KOSIK: And used a duckling so effectively.

HENICAN: They are burning up social media.

But you are right, Joe. If we had not had a new president on the way and so favorable as Donald Trump is likely to be, the Russian action would have been very different.

But here, essentially, they're going to bide their time. And it puts the onus back on Trump. Does he invite the 35 spies back into the United States? Great question.

JOHNS: But that's a problem for him if he does that.

HENICAN: It's a little dicey, and not just for the Democrats, by the way, right? The real problem is Republicans who spent the last generations being tough on Russia, right? Do they say okay, fine, now we're all ready to be kissy face? I don't know. I'm not sure they know.

KOSIK: House Speaker Paul Ryan, John McCain and Lindsey Graham all talking about how the Obama administration is long overdue. Why did the Obama administration wait on this? They learned about this in the fall. Why sit on it and do it now?

HENICAN: It's a good question. I don't know the answer. Frankly, I think in hindsight, it really may have been better to act sternly a little earlier. Here are the actions come and they are still in such contrast to the kind of hints we're getting from the incoming Trump administration. We will see a collision come January 20th.

JOHNS: The other thing and it's really important to say, is Donald Trump has already said he's' going to will meet next week with the intelligence community. This is the same intelligence community he is questioning the in intelligence. So, to be a fly on the wall in that room, what does that like?

HENICAN: Well, it's going to be strange, because notice the term he used yesterday. It's time to move on. You know, you usually move on from things after we acknowledge them, after we face the facts, after we face pain. In this case, we may be moving on before we ever got there in the first place.

JOHNS: Are we close to Cold War II?

HENICAN: You know, the rhetoric is sounding like. But that don't forget, there are so many other things. There was a genuine arms race, not a verbal one. There were troops in each other's faces. People oppressed, millions and millions of people. Thankfully we're not quite there yet.

KOSIK: All right. Ellis Henican, thanks so much for your perspective today.

[05:10:01] We're going to bring you back in about 35 minutes.

HENICAN: Good to see you.

JOHNS: Can the latest cease-fire in Syria hold long enough to allow real talks toward permanent stop to the civil war? More live from the Middle East, next.

(COMMERCIAL BREAK)

JOHNS: A new cease-fire now under way in Syria. You are looking at live pictures from Aleppo. You can see it is foggy, but peaceful. The new cease-fire part of a deal brokered with Turkey and Russia, including a return to peace talks after five years of war. Turkey's president calling the deal a historic opportunity that should not be squandered. But Russian President Vladimir Putin acknowledging the pact is fragile.

CNN's Ian Lee monitoring the situation from Istanbul joining us live with more.

IAN LEE, CNN CORRESPONDENT: Good morning.

So far this cease-fire seems to be holding. We are hearing reports there are scattered clashes, but they are few.

This cease-fire really is threefold. First, it is to stop the fighting between the different factions. On one side, you have Turkey and their allies. On the other side, you have Russia and Syrian government and their allies.

The second is to create a dialogue if there are violations, that they can be dealt with through dialogue and not resumption of fighting.

The third step is a month from now, they hope to get the sides together in Kazakhstan to start peace negotiations. I think the interesting thing to note is that the groups not part of the cease- fire. First, you have ISIS and next, you have Jabhat Fateh al-Sham, which is the al Qaeda associated group, and third, you have the YPG, which is part of the Syrian democratic forces which are backed by the United States.

JOHNS: Ian, President Assad made some more news yesterday. He was talking about President-elect Trump, saying there's optimism on his end, Assad's end about Trump presidency.

[05:15:00] What more do you know about that?

LEE: Let me read you the statement. And he said that "Part of the optimism could be related to the better relations between with the United States and Russia. If there's good relations between these two great powers, most of the world, including small countries like Syria will be the beneficiaries of this relationship."

Up until now, the United States has taken a very hard line when it comes to Syria, that President Bashar al-Assad must go. But the Syrian regime is hoping with President Trump, that tone could be softer could, that Trump has already expressed interest with warmer relations with Russia and that could translate to support for the Syrian regime.

So, they are hoping on January 20th, when Donald Trump becomes president, that things could shift. But when you look at the battle field, the momentum is with the Syrian regime and Russia. It is against the rebels.

So, when Trump does come to power, he will have to look at that as well.

JOHNS: Ian Lee in Istanbul, thank you for that.

KOSIK: The United Kingdom criticizing Secretary of State John Kerry for his comments on Israel earlier this week. A spokeswoman for British Prime Minister Theresa May says it is not appropriate to go after the political composition of the democratically elected government of an ally. May's office goes on to say, "While it considers the settlements construction illegal, they are far from the only problem in the conflict with the Palestinians."

Kerry on Wednesday went after Israel's government as the most right wing in the state's history and portrayed the settlements as the biggest obstacle standing in the way of peace.

OK, time for an early start on your money. We are watching global stocks. They're mixed this morning as markets enter the last trading day of 2016. The Dow will not hit 20,000 today probably. But we are seeing futures higher after closing lower yesterday.

Now, despite having kind of a lackluster end of the year, the stocks did enjoy a great run in 2016. Markets recovered from one of the worst ever starts to the year to hit a series of record highs. The Dow, NASDAQ and S&P, they're all on track for solid annual gains, with the Dow up almost 14 percent this year.

Could Twitter be getting an edit button? Hmm. CEO Jack Dorsey says the company is seriously considering it after the cofounder asked his almost 4 million followers how the company can improve in 2017. So, it turns out an edit option was the biggest request.

Other suggestions? Improving how conversations appear. And my favorite -- how to find better ways to cut down on harassment. I get it on Twitter.

JOHNS: You get a lot of trolls. But edit button. Editing a post you already put up?

KOSIK: Yes. JOHNS: That's a really cool idea.

KOSIK: Yes.

JOHNS: All right. Tennis great Serena Williams, has she finally met her match off the court? Andy Scholes has the details with the "Bleacher Report", coming up.

(COMMERCIAL BREAK)

KOSIK: The New York City Police Department ramping up security in Times Square for New Year's Eve.

At least 2 million people are expected to pack the crossroads of the world. And authorities say they are pulling out all of the stops in order to keep revelers safe.

CNN's Brynn Gingras has a preview of what you can expect out there.

(BEGIN VIDEOTAPE)

BRYNN GINGRAS, CNN CORRESPONDENT: Joe and Alison, 2 million people are expected to ring in the New Year here in Times Square on New Year's Eve. And you can imagine it basically takes an army to protect the city against any possible threat.

Now, no credible threats against the ball drop at this point, according to the NYPD, but every precaution is taking place. We are told by the NYPD, they are actually preparing for this once the ball drops earlier this year. It is a multilayer level of security.

Two things to note, though, that we haven't seen in previous years at this particular event, and that is 65 sand trucks and 100 barrier trucks which are basically department vehicles, they are going to form a perimeter around this Times Square area. That is in direct response to the truck-style attacks that we saw in both Nice and in Berlin.

We also know, just within the last few weeks, authorities with the NYPD have been visiting truck rental centers. They've been visiting parking garages. They've been talking to hotel owners just to make sure keeping every precaution for the security again is going to track millions as they ring in this New Year -- Joe and Alison.

(END VIDEOTAPE)

KOSIK: OK, Brynn, thanks very much.

JOHNS: And what would ringing in the new year be without football games? Arkansas against Virginia Tech in the Belk Bowl last night. But they were without the starting tight end because he was suspended for shoplifting at a Belk store.

KOSIK: Andy Scholes has more on this morning's "Bleacher Report".

Good morning.

JOHNS: This has got to be a first.

ANDY SCHOLES, CNN SPORTS CORRESPONDENT: Hey, good morning, guys.

Yes, this is one of the stories where you just say, really? Arkansas suspending senior tight end Jeremy Sprinkle from the Belk Bowl because he was shoplifting from a Belk store. Now, each Razorback player was given a $450 gift card to Belk as part of their bowl gift. Now, they went on a shopping spree on Tuesday.

And Charlotte police say Sprinkle attempted to shop lift $260 of items from the store. And since Sprinkle was a senior, the suspension ended his college career.

Now, Arkansas looked like they were going to be just fine without their tight end last night. They opened up 24-0 lead over Virginia Tech at the half. But the Hokies came storming back. They scored 35 unanswered to win the Belk Bowl by a final of 35-24.

All right. The college playoffs kickoff. Clemson and Ohio State facing off in the Fiesta Bowl in Arizona. That one kicks off at 7:00 Eastern. I'll be at Pitch Bowl in Atlanta for Alabama/Washington. The Tide, a two-touchdown favorite. But they're not taking the Huskies lightly.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I think this is by far the best all-around team we played all year long.

UNIDENTIFIED MALE: You do win a national championship, you have to go through Alabama to do it.

UNIDENTIFIED MALE: Coach said it is not about the other team do. It is about what we do.

UNIDENTIFIED MALE: I feel like the whole season, we've getting the same day. It doesn't matter who we play. People will never give us the credit. So, it is not even so much about Alabama or this game.

UNIDENTIFIED MALE: We are not worried about what happens after this game. We are worried about Saturday and Saturday only.

(END VIDEO CLIP)

SCHOLES: Ronda Rousey will make her long awaited return to the octagon tonight as she fights Amanda Nunez in UFC 207.

[05:25:00] This will be Rousey's first fight since losing to Holly Holm a year ago. Nunez showed to the weigh in, wearing a lion mask to the weigh-in. Her fighting nickname is the Lioness.

Now, Rousey not speaking to the media at all before this fight. But after the weigh-in, she posted this pic on Instagram, saying, "Thank you for the support at the weigh-in today. Looking forward to proving you all right tomorrow. It's going to be the happiest new year." All right. Finally, Serena Williams is officially off the market. Serena announcing she is engaged to Alexis Ohanian, the co- founder of Reddit. That's where the couple made the announcement with this cartoon.

Now, Ohanian proposed to Serena at a restaurant in Rome. Here's a pic of the happy couple in Hollywood. Now, they met a year ago.

This came as a surprise to a lot of people because their relationship is behind closed doors for the most part. We have not seen them in public very often. That's why millions of people were surprised as this news came out yesterday. They were engaged.

KOSIK: Well, good for them. They don't want everybody in their business.

JOHNS: Right. But what was he wearing? Was that like a lion suit?

SCHOLES: Well, that was from Halloween.

KOSIK: Dress up on Halloween.

JOHNS: Got it. OK. That's an outfit.

KOSIK: Hope they take new pictures.

SCHOLES: Like I said, they haven't been seen in public very often. So, that's all we've got, guys.

JOHNS: All right.

KOSIK: Andy Scholes reporting on love.

SCHOLES: All right.

JOHNS: We're watching Moscow where officials are weighing retaliations following U.S. sanctions over the election hacks. We are live in Moscow coming up next.

(COMMERCIAL BREAK)

KOSIK: Breaking moments ago. Russia announcing retaliatory response to the new sanctions leveled by the White House over this year's election hacking. How far did Moscow go? We're live in Russia.

JOHNS: In Syria, the early hours of the cease-fire between the Assad regime and rebel groups after more than five years of bloodshed. Is this enough to get the sides talking about a permanent solution? We are live in the Middle East.

KOSIK: And security being stepped up at the crossroads of the world. Less than 48 hours to the big ball drop, how are authorities keeping Times Square a safe zone?