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China Warns of Retaliation Against New U.S. Tariffs; Trump Surprised by Don Jr.'s Subpoena; Mother Says She Warned Colorado School of Another Columbine; Trump Says John Kerry Should be Prosecuted. Aired 4-4:30a ET

Aired May 10, 2019 - 04:00   ET

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

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[04:00:23] DONALD TRUMP, PRESIDENT OF THE UNITED STATES: They renegotiated the deal. They took many, many parts of that deal and they renegotiated. You can't do that.

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CHRISTINE ROMANS, CNN ANCHOR: A trade war that could hit your wallet. The White House raising tariffs on $200 billion of Chinese goods, and China is vowing to retaliate.

DAVE BRIGGS, CNN ANCHOR: Months before the deadly school shooting in Colorado this week, a parent had warned school officials in Colorado pressure cooker conditions could lead to another Columbine.

ROMANS: Extreme flooding in and around Houston. Dozens of water rescues, rivers over their banks, 100,000 customers in the dark.

BRIGGS: And a school bus driver takes off with a student's backpack caught in the door. Why the teen's mom says it was intentional and racist.

Good morning, everyone and welcome to EARLY START. I'm Dave Briggs.

ROMANS: And I'm Christine Romans. It is Friday, May 10th. It is 4:00 a.m. in the East, it is 4:00 p.m. in Beijing, and today is the day. Tariff day.

The Trump administration raising tariffs on $200 billion of Chinese goods. That is thousands of different items, including dish washers, frozen fish, baseball caps. Right now tariffs hit roughly half of the products that China sells to the United States.

How did we get here. That's thanks to three rounds of tariffs last year starting with March, starting with the U.S. hitting all foreign steel and aluminum, including from China. The U.S. then singled out Beijing in July 2018 hitting some $50 billion worth of Chinese exports. That's mostly high-tech goods. And then it goes on, China retaliated with tariffs on $50 billion U.S. goods, mainly Ag products which have big markets in China. Then in September -- in September the U.S. unveiled its biggest round

yet, that $200 billion in This included consumer goods like luggage, handbags and hats. Now Beijing -- Beijing then hit $60 billion of U.S. exports in response. Tit-for-tat. But that $200 billion, that $200 billion in September, that was originally taxed only at 10 percent. The administration today bumped that up to 25 percent. A big difference.

Now remember, it's U.S. importers, not China, who pay those tariffs, and experts warn this could have an economic hit. It will disrupt especially smaller American companies costing the U.S. more than 900,000 jobs. And it could mean higher prices for consumers, raising expenses for the average family of four by $767 a year because the higher prices for the goods they're buying and putting in their shopping cart.

And this trade war -- this trade war is not over. President Trump is threatening to tax nearly all Chinese imports, all of them.

Now where do we go from here? The president also has until May 18th, this is super important, to decide whether to impose global auto tariffs separate from the China trade war which would likely make cars more expensive.

Global markets do not like -- do not like -- trade wars. You have the S&P 500 down four days in a row and it looks like this morning you will see U.S. futures weak at the open -- Dave.

BRIGGS: OK, 5,000 items tariff. Christine Romans, thank you, my friend.

Well, it takes two, as you note, to have a trade war. Beijing has threatened to retaliate for the tariff increase. And CNN's Matt Rivers standing by live for us in China this morning.

Matt, what might retaliation look like from the Chinese?

MATT RIVERS, CNN INTERNATIONAL CORRESPONDENT: Well, they've got a number of different options, Dave. We're at a port in the city of Tianjin. And a lot of what China ships to the United States goes out of this port behind me, but it's also what America brings into China. Some -- more than $100 billion a year of American goods come here to China.

Most of those have already had tariffs placed on them already, as Christine just laid out. But China could do a number of things here. They could raise the rates of those tariffs going from 10 percent to 25 percent, say, like the U.S. just did. They could also make life here for U.S. companies, market access issues. Say you're a pharmaceutical company looking to license a new product here in China, they could slow down that process.

And then of course there's also things that would be perhaps less formal. Like if you were an agricultural exporter, for example, and you sent a perishable good to a dock like this, well, maybe the inspections people here, the customs people in China, they don't get around to looking at your shipment, your food perishes on the dock, you don't make any money because your Chinese buy never got his or her goods.

So there's a lot of things that China will do. We don't know exactly what they're going to do yet, Dave. But you can bet that they are going to do something.

BRIGGS: OK. Matt Rivers standing by live for us. We'll check back within the next half hour. Thank you.

ROMANS: All right. President Trump none too pleased about the subpoena his son Don Jr. received from the Republican-controlled Senate Intelligence Committee.

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[04:05:05] TRUMP: I was very surprised to see my son -- my son is a very good person, works very hard. The last thing he needs is Washington, D.C. He could rather not ever be involved. He's now testified for 20 hours or something. A massive amount of time. The Mueller report came out. That's the bible. The Mueller report came out, and they said he did nothing wrong.

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ROMANS: That's not entirely true. Several people have contradicted Don Jr.'s claim under oath that he only told two people about his impending Trump Tower meeting with the Russians on June 2016. It's not clear whether the president's son will comply with the subpoena, not show up, plead the Fifth or choose another option.

BRIGGS: Members of the president's inner circle are upset with Senate Intel chairman Richard Burr, a fellow Republican. They believe his decision to serve Don Jr. with a subpoena gives Democrats a valuable talking point, and the chair does not want to discuss it.

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UNIDENTIFIED REPORTER: The White House is taking a big swing at you, nothing, Senator Burr?

SEN. RICHARD BURR (R-NC): Nothing.

UNIDENTIFIED REPORTER: You made a big move.

BURR: No. Nothing. We don't -- we don't talk about any engagements we had in the committee. We never have. We're not going to start today.

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BRIGGS: CNN has learned in a closed-door Senate Republican lunch Burr explained the back story of the subpoena and defended his committee's investigation. Mitch McConnell publicly supporting Burr even though just days ago the Senate majority leader said case closed on the Mueller investigation. ROMANS: Add James Comey's name to the list of people who believe

President Trump obstructed justice. The former FBI director was asked about the Mueller report in a live CNN town hall event last night. The report had several examples of possible obstruction by the president, but Attorney General Bill Barr decided not to bring charges because he could not determine the president's intent.

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ANDERSON COOPER, CNN ANCHOR: Do you think he had criminal intent based on what you have seen now in the Mueller report?

JAMES COMEY, FORMER FBI DIRECTOR: It sure looks like he did in connection with a couple episodes, the direction to Don McGahn to get special counsel fired is to my mind a flaming example of --

COOPER: Of corrupt intent.

COMEY: Yes. Of corrupt intent.

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ROMANS: We recently learned Mueller and his team took issue with how AG Barr summarized those findings. So does Comey.

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COMEY: I think he acted in a way that's less than honorable in the way he described it in writing and described it during a press conference, and continues to talk as if he's the president's lawyer. That is not the attorney general's job.

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BRIGGS: Comey also offered up this theory about why President Trump is deferential to Vladimir Putin and the Russians.

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COOPER: Do you think the Russians have leverage over President Trump?

COMEY: I don't know the answer to that.

COOPER: Do you think it's possible?

COMEY: Yes.

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BRIGGS: It appears President Trump may have been watching CNN despite constantly denying it. Last night he tweeted, quote, "James Comey is a disgrace." Comey went on to say he would like to hear Robert Mueller testify to explain why he left the matter of obstruction up to Barr. The House Judiciary Committee is trying to secure a date for the special counsel's testimony. ROMANS: All right. Flash flood warnings in effect for the Houston

metro area. Rains so intense the excess underground was pushing that manhole cover. Some 40 people trapped by flood waters with rainfall rates of two to three inches an hour reported. Emergency crews saved a person trapped in this car that flipped and submerged in a flooded ditch. Hail and frequent lightning also part of the mix.

BRIGGS: Flag poles even wobbling there with the roof closed at Houston's Minute Maid Park. Several creeks, rivers and bayous in the area have reached their banks with water flowing into homes and businesses. Over 100,000 customers were without power at the height of the storm. Many counties were still recovering from flooding and heavy rain earlier in the week. More than 20 million people in parts of southeast Texas, Louisiana and Mississippi under a flood watch.

ROMANS: A startling revelation out of Colorado, months before the deadly shooting. At STEM School Highlands Ranch near Denver, an anonymous parent said she was afraid another Columbine would happen there. The school board did ask for an investigation after that complaint. Now the woman who says she's the anonymous parent is talking exclusively to CNN. Here's what she told Scott McLean.

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UNIDENTIFIED FEMALE: When you mix a pressure cooker environment where students are stressed out and overworked and they don't get enough sleep, and they feel suicidal or they feel aggressive towards one another, and are not being disciplined for it. When you don't listen to parents' concerns, when you don't support teachers' concerns, when you don't give teachers the kind of training that they need or the support that they need. Those are the elements that we need for the perfect storm.

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[04:10:03] BRIGGS: The woman wants to stay anonymous because she fears retaliation, but CNN confirmed she does have a student in the school. She speaks of kids who had a rigorous math and science based academic program, little sleep and started acting out aggressively.

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UNIDENTIFIED FEMALE: I also saw violence against themselves happening, you know, with students, and threats of suicide, cutting, attempted suicide, drug use that was getting pretty serious. You know, numerous reports from my children as they witnessed it, experienced it firsthand, and other students that witnessed it or experienced it firsthand. So the pattern was pervasive.

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ROMANS: The woman says teachers were well intentioned. The school's executive director told CNN through a PR firm the school found no evidence to support the allegations made by the parent. In a statement, she said, "Like any school with more than 1800 students, we receive complaints, all of which we take seriously and investigate promptly." The suspects in the shooting are due in court today.

BRIGGS: All right. The co-founder of Facebook wants the social media network broken up. What Chris Hughes now says about his friend Mark Zuckerberg and the company they created together.

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[04:16:05] BRIGGS: 4:15 Eastern Time. And a North Korean cargo ship seized by the United States for alleged sanctions violations. Tensions were already high between the U.S. and North Korea, and this incident likely to increase them following the failure of the Hanoi summit.

The Justice Department says the vessel was being used to haul coal from North Korea that were sold to other countries including China. The U.S. and the U.N. have accused the Kim regime of using illicit sales of its coal to fund its nuclear weapons program. The seizure of the ship comes one day after the North Korea launched two short range missiles. Its second launch in a week. The president now says he doesn't believe North Korea is ready to negotiate.

ROMANS: President Trump thinks former secretary of state John Kerry should face felony charges. On Thursday the president was asked what Iran did to trigger the deployment of a U.S. aircraft carrier to the Middle East. Mr. Trump replied they were threatening, and then he took this odd turn.

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TRUMP: What I would like to see with Iran, I'd like to see them call me. You know, John Kerry, he speaks to them a lot. John Kerry tells them not to call. That's a violation of the Logan Act. And frankly he should be prosecuted on that.

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ROMANS: The Logan Act makes it a felony for anyone without authorization to negotiate with foreign governments that have disputes with the U.S. The president claims Kerry undercut his policy on Iran by speaking with its leaders. A spokesperson for Kerry says, quote, "Everything President Trump said today is simply wrong, end of story."

BRIGGS: A call to break up Facebook now coming from a co-founder of the social network. Chris Hughes, who helped Mark Zuckerberg launch Facebook from a college dorm room, penning a "New York Times" op-ed. In it he writes, Zuckerberg's, quote, "unchecked power and influence far beyond anyone else in the private sector or in government." Hughes says Facebook should be forced to reverse its acquisitions of Instagram and WhatsApp. He says in part, "I'm worried that Mark has surrounded himself with a team that reinforces his beliefs instead of challenging them."

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CHRIS HUGHES, FACEBOOK CO-FOUNDER, ENTREPRENEUR: Every single time there's some new headline about a privacy scandal or an election that's going on, I do feel a sense of responsibility. I'm angry at Mark and I'm angry at a lot of Facebook's leadership for taking something that held so much promise and could have been so amazing and sacrificing quality, security, stability, for clicks.

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BRIGGS: Wow. Hughes left Facebook in 2007 and sold all his sock in 2012, pocketing a half a billion dollars. Facebook responding, quote, "It accepts that with success comes accountability but you don't enforce accountability by calling for the breakup of a successful American company."

Romans, this raised eyebrows in the tech community and in government.

ROMANS: Yes.

BRIGGS: This is not some bitter former investor. He's a very rich man.

ROMANS: Yes.

BRIGGS: And a friend of Mark Zuckerberg's.

ROMANS: Yes. Stay tuned there.

BRIGGS: Yes.

ROMANS: All right. Imagine he went on leave to fight cancer and had to pay the salary for your fill in at work. It's happening to one California teacher.

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[04:24:07] ROMANS: Troubling video out of Utah. A bus driver closes the door on a student, closes the door on the student trapping him and dragging him by his backpack for about 20 seconds. The 14-year-old coming dangerously close to the tires. Now the student's mom, Brenda Mayes, is suing saying the driver did it because her son is biracial.

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BRENDA MAYES, STUDENT'S MOTHER: Something fell. They have a responsibility when I put my kids, send them off to school, they have a responsibility to make sure they're safe.

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ROMANS: The suit argues this driver has a history of misconduct against kids of color. According to CNN affiliate KSTU, the driver, John Naisbitt, says he retired three days after the incident to avoid being fired.

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UNIDENTIFIED REPORTER: Would you say that you're racist?

JOHN NAISBITT, BUS DRIVER: Not at all, no.

UNIDENTIFIED REPORTER: Yes.

NAISBITT: Look at my dog, he's black as can be.

(LAUGHTER)

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[04:25:02] ROMANS: Naisbitt says the incident was staged because he has disciplined the boy's brother. In response to the suit the district says any claims of discrimination are being investigated.

BRIGGS: A San Francisco teacher on medical leave battling breast cancer is being forced to pay for her own substitute at the Glen Park Elementary School. All district teachers get 10 paid days of medical leave each other. They can get another 100 sick days, but the cost for the substitute teacher deducted from the teacher's salary. In San Francisco, that's more than $200 a day. The teacher in question has chosen to remain anonymous but parents are speaking out.

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ABBY HIPPS, PARENT: She's wonderful. She's a beautiful, lovely, great teacher. She's one of the best teachers, so it's terrible.

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BRIGGS: A GoFundMe page for the teacher that has now stopped accepting donations received $13,000.

ROMANS: Wow. I want to learn more about that story because there's the Family Medical Leave Act. There are all kinds of laws that are meant to protect people.

BRIGGS: Yes.

ROMANS: When you are ill or have a family issue.

BRIGGS: Further scrutiny, we'll stay on it.

Ahead, things you could buy every day could start costing a lot more. New trade tariffs now in effect on billions worth of Chinese goods. Beijing vows to retaliate. We're live in China, ahead.

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