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Early Start with John Berman and Zoraida Sambolin

Sources: More Searches for Biden Documents Could be Conducted; Former GOP Candidate Arrested for Shooting at Homes of Democrats; Ukrainian City of Dnipro Reeling After Cruise Missile Attack; GOP Demands Spending Cuts in Exchange for Debt Limit Hike. Aired 5-5:30a ET

Aired January 17, 2023 - 05:00   ET

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

[05:00:26]

CHRISTINE ROMANS, CNN ANCHOR: Right now on EARLY START, more Biden officers might be searched for classified documents. What more could be revealed?

A big break in the mystery shootings targeting Democratic officials in Albuquerque. Police just announced an arrest.

And the most wanted mafia boss, just arrested after 30 years on the run. How he hid in plain sight from police.

Good morning. Welcome to our viewers here in the United States and around the world. I'm Christine Romans.

The search for classified documents, connected to President Biden might not be over this morning. Multiple sources telling CNN there could be more searches of other locations in the coming days.

CNN's Arlette Saenz has more from the White House.

(BEGIN VIDEOTAPE)

ARLETTE SAENZ, CNN WHITE HOUSE CORRESPONDENT (voice-over): President Biden refusing to answer questions today as pressure mounts.

KEVIN LIPTAK, CNN WHITE HOUSE CORRESPONDENT: Will you testify with the special counsel?

SAENZ: CNN has learned the president is personally frustrated with how the classified documents saga has unfolded, this as more details about the classified documents at his Wilmington, Delaware, home come to light.

The White House on Thursday morning saying Biden's personal attorneys searching a room adjacent to the president's garage found one page of classified material. Over the weekend, the president's White House lawyer revealing he traveled to Delaware on Thursday evening and five additional pages with classification markings were discovered.

It's the latest example of a shifting narrative from a White House on defense. Now referring all questions to the Justice Department as the special counsel investigation gets underway.

MERRICK GARLAND, ATTORNEY GENERAL: Upholding the rule of law means applying the law evenly.

SAENZ: The president's personal attorney defending their information sharing approach saying they're working quote to balance the importance of public transparency where appropriate with the established norms and limitations necessary to protect the investigation's integrity.

But Republicans promising investigations are sounding off.

REP. JAMES COMER (R-KY): The administration hasn't been transparent about what's going on with Biden's possession of classified documents.

SAENZ: The House Oversight chairman demanding visitor logs for the president's Delaware home. But today, the White House and Secret Service say they simply don't exist. The White House counsel adding: Like every president across decades of modern history, his personal residence is personal.

Some Democrats acknowledging the situation has been messy.

SEN. DEBBIE STABENOW (D-MI): It's certainly embarrassing, right? I mean, it's embarrassing that you would find a small number of documents.

REP. ADAM SCHIFF (D-CA): I still would like to see Congress do its own assessment and receive an assessment from the intelligence community of whether there was exposure to others of these documents, whether there was harm to national security, in the case of either set of documents with either president.

SAENZ: But as he celebrated the life of Dr. Martin Luther King, the president trying to keep the focus on the future.

JOE BIDEN, PRESIDENT OF THE UNITED STATES: This is a time for choosing. Will we choose democracy over autocracy? Community over chaos? Love over hate? These are the questions of our time.

(END VIDEOTAPE)

SAENZ (on camera): This all comes as sources tell CNN there are additional locations tied to President Biden that could be searched for more classified documents, or government records.

Now, so far, President Biden's personal attorneys have searched his two homes in Delaware, and then former private office over here in Washington, D.C. Sources believe there may be other locations that could be searched, though it's unclear exactly who would search those locations or where those locations exactly are. But all of these are matters which could be looked into by the special counsel, when that investigation gets underway.

Arlette Saenz, CNN, the White House.

ROMANS: Arlette, thank you for that.

In New Mexico, a former Republican state house candidate is under arrest for a series of shootings, targeting the homes of local Democratic officials. Police in Albuquerque say Solomon Pena is believed to be the mastermind behind the shootings. He will be charged in connection with four shootings at the homes of two Democratic county commissioners, a house speaker and a state senator. No one was injured. All four homes were damaged. Detectives also served search warrants at the home of two men that Pena allegedly paid.

The Russian missile which destroyed a nine story apartment building in the Ukrainian city of Dnipro carried a one ton warhead, a warhead designed to seek aircraft carriers. The devastating attack killed at least 40 people. Dozens more are now missing.

Clare Sebastian has the latest, live from London.

And, Clare, we understand the U.K. is pledging a new round of military aid to Ukraine.

CLARE SEBASTIAN, CNN CORRESPONDENT: Yes, Christine. Crucially, that will, for the first time for many of Ukraine's western allies include battle tanks.

[05:05:04]

The U.K. says it's going to send a squadron of 14 challenger two tanks. The defense minister said this will help Ukraine, alongside artillery and things like that to target Russian command and strategic positions from a greater distance, to try to help them break through.

Now, clearly, Ukraine is hoping for more. Obviously, 14 tanks is not going to win the war, with an 800 mile frontline. They are increasing pressure on allies like Germany in particular. Germany has its Leopard tanks, which other European countries who own them have wanted to send in the Ukraine, but Germany must grant permission.

That pressure is going to intensify this week, when many Western countries are going to be meeting in Ramstein, Germany, to discuss further military aid for Ukraine. I think when you see attacks like the one on Dnipro, which is one of the deadliest for civilians in months, this does tend to strengthen the resolve of Ukraine's Western allies, for resolve.

We've seen this throughout the war, but the fear is always that Russia will see this as an escalation, which will make things worse in the short term for Ukraine. The Kremlin has said that the British tanks, quote, will burn like the rest -- Christine.

ROMANS: All right. Clare Sebastian, thank you so much for that, from London this morning.

All right, chilling new video has emerged of the final moments before the Yeti Airlines crash in Nepal. We want to warn you, this video is disturbing.

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ROMANS: The video shows a normal flight, and in the plane is shaking, people screaming. It ends in a fiery scene. CNN edited the footage so you can't identify anyone. We have cut it off, the moment of the crash, we are showing it because it reveals how quickly events unfolded, and it might shed light on why the crash happened.

Aviation officials in Nepal deny this video is from the crash, but CNN has corroborated it several ways, including geolocation, checking the flight manifest and having friends identify the passenger, who reportedly shot it.

In the meantime, the search for two remaining victims of the airlines crash in Nepal resume this morning. So far, 17 bodies have been recovered.

CNN's Vedika Sud is live in New Delhi for us, with latest.

What's the latest on this search, Vedika, for the last -- final two victims?

VEDIKA SUD, CNN REPORTER: Christine, it is day three of search operations, officials told us on Monday, the chance of many survivors looks very unlikely. Now, there is a search on for the last two bodies. What we do know is more than 20 bodies have been handed over to family members, in Pokhara, or the crash took place. There were 40 bodies, which have been airlifted the capital of Kathmandu where the bodies will be handed over to family members.

Very interesting details also emerging on the last few moments before the crash took place. As you pointed out, that video could be an important piece of evidence, according to aviation experts, which could lend to understanding what really happened before the planes crash. According to an aviation expert of the flap of the wing there, could help understand what really happened. Because usually, there's an extra lift the wing takes before landing. In this case, according to that aviation expert, it was not fully extended.

Now, the black boxes answer will be extremely critical to this investigation. The committee informed has to submit their report within 45 days. Two other developments we got to know of, according to officials, the pilot had asked for a last-minute change of runway. There are two runways at the Pokhara Airport, the pilot asked for a change in one way, the officials also pointed out that there was no distress call when the pilot was talking to the air traffic control.

To me, a very important significant part of this entire incident is the fact that the impact, Christine, of this crash could have been a lot worse, because it was right next to a lot of homes. Eyewitnesses have spoken about a ball of fire, and the thunderous explosion they heard. The casualty list could at the much higher had this landed closer to the residential area in that spot -- Christine.

ROMANS: That is just chilling to think of.

All right. Vedika Sud, thank you so much. Excellent reporting. The FAA is launching an investigation to find out why a commercial

airliner, taxied directly in front of a jet, taking off from New York's JFK airport last Friday night. The crew of a Delta Airlines Boeing 737 was able to abort its take off, stopping 1,000 feet of an American Airlines Boeing 777.

We get more from CNN's Brian Todd.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice-over): The urgency in the air traffic controller's voice reflects the danger at that moment.

He yells at a Delta passenger plane to abort takeoff as it's accelerating toward an American Airlines jet crossing its runway.

[05:10:03]

JFK TOWER: (EXPLETIVE DELETED) Delta 1943, cancel takeoff plans. Delta 1943, cancel takeoff plans.

PILOT: Rejecting.

TODD: This incident, which occurred Friday evening at New York's JFK International Airport, is under investigation by the FAA and the National Transportation Safety Board. The Delta Airline 737 with more than 150 people on board successfully aborted its takeoff. No one was hurt, but the aviation safety community is still taking a collective gasp.

DAVID SOUCIE, CNN SAFETY ANALYST: It was very frightening for the pilots in the plane because they're already going over 150 miles an hour and they have to stop before they get to him.

TODD: The FAA says the Delta plane stopped within 1,000 feet of the American Airlines 777 that was crossing its path. That's a little more than three football fields.

SOUCIE: A thousand feet is not as far as you think. It might be about a city block or so. But when you're going those speeds and trying to stop an airline of that magnitude at that speed, it's very, very scary.

TODD: After the incident, an exchange between the crew of the American Airlines plane and air traffic control showed apparent confusion. Someone in the American plane's cockpit asked the controller this.

AA106: The last clearance we were given, we were cleared to cross. Is that correct?

TODD: The controller replies they'll have to listen to the tapes. It's not clear if the American Airlines jet did get permission to cross that runway. This incident is known as a runway incursion and experts say it's reflects the most dangerous part of any flight. SOUCIE: You're on the ground. You're susceptible to everyone around

you. You're reliant on the decisions of other people around you because you're very close proximity to a lot of big airplanes going very fast, landing and taking off is definitely the most hazardous portion of your flight.

TODD: The FAA says there were more than 1,400 runway incursions in 2022. Experts say most were not as serious as this one, and not all involved commercial planes. But the overall rise of these near misses in recent years is alarming.

MARY SCHIAVO, FORMER INSPECTOR GENERAL, TRANSPORTATION DEPARTMENT: Runway incursions, in other words, it's two planes on a runway or taxi way when they aren't supposed to intersect, have a risk of intersecting, it had been up 92 percent from 2011 until 2018. So this is a huge issue with the government, with the FAA.

(END VIDEOTAPE)

TODD (on camera): Why has the number of these incidents gone up so dramatically? The expert CNN spoke to spoke to a number of factors. The increase in the overall number of flights is one, but they also say that new safety measures which have been proposed, like detection systems and sensors often take several years to implement, and not all aircraft are equipped with them yet.

Brian Todd, CNN, Washington.

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

Walgreens is removing its online buying limits for children's pain and fever reducing medications. The Walgreens only had limits in place on medicines bought online. High demand for children's pain and fever medications led some stores, including CVS and Rite Aid to limit purchases. A dangerous respiratory virus season had seen a 65 percent spike sales in kids medications. CNN says they have a two product limit on all children's pain medications in stores and online.

Right ahead, the GOAT's final game? Tom Brady on his football future after getting knocked out of the playoffs.

Plus, an Indiana man arrested after his four-year-old son was caught on camera waving a gun.

And a former president says he regrets the insurrection. And no, we're not talking about Donald Trump.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

SEN. CHUCK SCHUMER (D-NY): We'd like to get a debt ceiling done in this work period.

KARINE JEAN-PIERRE, WHITE HOUSE PRESS SECRETARY: So when it comes to the debt ceiling, it should not -- it should not be used or never be a matter of political brinksmanship.

JANET YELLEN, SECRETARY OF TREASURY: It's really up to Congress to raise the debt ceiling.

ROMANS: Ah, the debt ceiling, the eternal Washington food fight. So what is it? And why is it so contentious?

The debt ceiling is the legal limit set by Congress on how much money America can borrow. Because the U.S. spends more than it takes in, it borrows to make up the difference. The debt ceiling caps how much.

The problem is, it's not enough. So, every once in a while Congress needs to raise it. If it doesn't, the Treasury Department won't be able to pay all the country's bills in full and on time.

Now the Treasury does have a little wiggle room before it gets to that point, what it calls extraordinary measures to move money around. But eventually, the accounting tricks run out and there's no more avoiding the debt ceiling. That's when the fireworks usually break out.

REP. MIKE LAWLER (R-NY): Our debt is out of control. I mean, we're talking about over $30 trillion.

SEN. ELIZABETH WARREN (D-MA): Me? I get rid of the debt ceiling altogether. It serves no function except to create leverage.

REP. DAN CRENSHAW (R-TX): Look, they're difficult political times. Nobody likes them but they are necessary evils in a sense because it's the only time that you can actually negotiate ways to get our budget under control.

ROMANS: Now, many say raising the debt ceiling is just a license to spend more money and grow the debt but it's not really raising the debt ceiling just lets treasury pay the bills America already owes.

BIDEN: There's nothing to do with any new spending.

ROMANS: If Congress really wants to clamp down on debt, it has to do it a lot earlier like before passing spending bills or tax cuts, both of which can add to deficits. Failing to raise the debt ceiling won't keep a lid on debt. It just risks the U.S. defaulting on its obligations something that could forever stain America's global reputation.

(END VIDEOTAPE)

ROMANS: All right. That's your background.

With me now, Greg Valliere, chief U.S. strategist of AGF Investment.

And, Greg, House Democrats want spending cuts in exchange for raising the debt ceiling. What are the chances the U.S. goes to the brink over this and faces defaulting maybe in June?

GREG VALLIERE, CHIEF U.S. STRATEGIST, AGF INVESTMENT: The chances are not zero, Christine. This is the first time in decades that this is really a serious threat. I wrote the other day I thought it was 60/40 we'd get a deal.

[05:20:02]

But does it really mean there's a 40 percent chance of default? That's unthinkable.

ROMANS: It is unthinkable, but when you look at the new House majority, House Republican majority, and the priorities, it wants to use this debt ceiling as leverage.

VALLIERE: Sure. Then you have to ask everybody, what would you do specifically? Would you cut social security? Medicare? Would you raise taxes? Would you cut defense? I mean, you have to get to specifics and then it gets much more difficult.

ROMANS: So remind our viewers what happens if the U.S. does not raise the debt ceiling and cannot borrow money to fulfill its obligations?

VALLIERE: Well, I think worldwide, there would be a sense that the U.S. is no longer a credible player. It would be horrible for the U.S. it would probably raise interest rates. It would give the Federal Reserve lots of things to worry about. And the main problem is that, again, you can't come up with specifics to deal with this.

ROMANS: All right. June I think is when we think those extraordinary measures would run out. They have some time for politics.

Meantime, you got job market 3.5 percent jobless rate. White House talking about how strong the job market is even be if the Fed is raising interest rates. You have a labor shortage in the country, right? You have a labor shortage. One obvious way to fix it is do an immigration reform bill to increase quotas for legal immigrants.

You say the cynical view is neither side is motivated to solve the labor shortage. Why?

VALLIERE: It's a cynical view, you're right, Christine. I think on both sides there's a sense that they have talking points. The Democrats can say, oh, the Republicans are cruel and heartless. The Republicans can say this is illegal and leads to crime.

Everybody has their sound bites and I think it's in no one's interest to get a deal right now.

ROMANS: The frustration at the White House we know because inflation seems to be peaking. Jobless rate is the 3.5 percent. Job market, there are hopes you might be able to avoid a recession this year or will it just be a mild recession and what could be, you know, White House leaning into all of this, there's this document story.

Sources tell CNN more searches can be conducted at places connected to the president for documents. How damaging is this for the Biden presidency and a second Biden election?

VALLIERE: It really is, Christine. I talked to a lot of people in this town who are stunned by the ineptitude of the White House. It's a big deal.

Here's the smoking gun. The first documents were found on November 2nd. The election, the midterm election was a week later. Between November 2nd and the election, someone made the decision not to publicize the fact that they found these things.

ROMANS: All right. Greg Valliere, AGF Investments, a lot to get through today. Thank you so much. Nice to see you.

VALLIERE: You bet.

ROMASNS: All right. Quick hits across America now.

In Central California, police believe Monday's fatal shooting of six people, including a mother and her 6-month-old baby believe this was a cartel type of execution. The Tulare County sheriff says they are looking for at least two suspects.

A man has been arrested after video aired on a real life police show, showing a 4-year-old waving a loaded handgun. He also allegedly pointed it at a neighbor's son. The child's father was charged with neglect.

A source close to Kari Lake says the defeated Arizona candidate for governor and election denier is now considering a run for the U.S. Senate in 2024. Former Democrat and now independent Senator Kyrsten Sinema currently holds the seat and is up for re-election.

Just ahead, China's economy takes a hit for the first time in 50 years and so it does population count. And Italy's most notorious fugitive and the mafia's last godfather arrested after 30 years on the run.

(COMMERCIAL BREAK)

[05:28:17]

ROMANS: China's economic growth of just 3 percent in 2022 marks one of its worst years in nearly half a century. And China's population also fell for the first time since 1961, which could undermine the world's second largest economy in the coming years.

CNN's Kristie Lu Stout joins me live from Hong Kong this morning.

You know, Kristie Lu Stout, these are amazing numbers here, to see a population decline, and the working age population decline. Walk us through what this means.

KRISTIE LU STOUT, CNN CORRESPONDENT: Yeah, it means that right now China is experiencing multiple headwinds and last year was a particularly challenging year. For 2022, China posted GDP growth of only 3 percent for the fourth quarter, and 2.9 percent year on year.

And China is now saying its population is shrinking for the first time since the 1960s. That includes its working age population. This presents a new demographic crisis for China. China right now is battling two economic headwinds at the present moment, the ongoing property slump. On top of that, the aftereffects of the zero COVID policy, which absolutely wrecked its economy, so much so that provincial governments were forced to spend billions of dollars on anti-pandemic measures.

We learned that Guangdong province spent $22 billion on zero COVID measures, like mass testing campaigns. That is one of the reasons why we had the U-turn. China ended abruptly its zero COVID policy. That causes ongoing wave of infection.

But when you ask economists about the economic pain being caused by this ongoing outbreak, they say it will be short lived. I want you to look at this. This is a comment that we got earlier today from Adan Yao. He's an economist at AXA.

He says that Q4 has likely marked the darkest before the dawn. He goes on to say, with the reopening timeline now significantly frontloaded, the economic outlook has brightened beyond the new term.