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Trump Vows to Help Restore Jobs in China; U.S. to Open Embassy in Jerusalem. Aired 6-6:30a ET

Aired May 14, 2018 - 06:00   ET

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

ANNOUNCER: This is NEW DAY with Chris Cuomo and Alisyn Camerota.

CHRIS CUOMO, CNN ANCHOR: Welcome to our viewers in the United States and around the world. This is your NEW DAY. It's Monday, May 14, 6 a.m. here in New York. Alisyn is off. The one and only Erica Hill joins me. Always a pleasure.

ERICA HILL, CNN ANCHOR: Good morning.

CUOMO: Good to have you.

HILL: Good to be here.

CUOMO: All right. Here's our starting line. In a stunning reversal, President Trump is telling his Commerce Department to step in and save a Chinese smartphone maker.

The administration had banned U.S. firms from selling ZTE parts, retaliation for violating U.S. Sanctions on Iran in North Korea. Members of Congress have called the company's technology a major cyber security threat. Is the president putting Chinese jobs ahead of national security like his critics claim? That's one question.

Unlike that situation, there is no mystery surrounding a lack of public apology from an aide to President Trump for making that morbid comment mocking Senator John McCain's health. A source tells CNN Kelly Sadler, that aide, promised McCain's daughter she would publicly apologize. Now, at this point, we're supposed to ask where is that apology? But you know the truth. Trump sees apologies as weakness. And it's clearly OK with mocking a hero who is in the fight of his life. That's just the truth.

HILL: Meantime, President Trump's lawyer, Rudy Giuliani, creating more headlines and headaches for his client. Giuliani now backtracking after saying the president denied the AT&T merger. contradicting months of White House and Justice Department statements.

And in just hours, a major milestone for the Trump administration. The U.S. will open its Israeli embassy in Jerusalem, fulfilling a Trump campaign promise. Will that move, though, add to more instability in a region already on edge.

We have it all covered for you this morning. We begin with CNN's Jeff Zeleny live at the White House with our top story. Jeff, good morning.

JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Good morning, Erica.

China has long been a favorite punching bag of President Trump. Of course, he has accused China of stealing jobs here in America.

But that tone softened remarkably over the weekend. The president trying to set a positive backdrop as trade talks begin here this week in Washington in hopes of averting a living trade war.

(BEGIN VIDEOTAPE)

ZELENY (voice-over): In a surprising departure from his hardline rhetoric on trade, President Trump appearing to reconsider a punishment imposed on Chinese electronics giant ZTE, saying in a tweet he's working with China's president to give the country a way to get back in business fast.

Last week, ZTE announced that it was ending major operating activities after the Trump administration banned U.S. companies from selling parts or providing services to ZTE until 2025. ZTE was accused of violating U.S. sanctions on North Korea and Iran, then lying about the aftermath, a claim ZTE denied.

WILBUR ROSS, COMMERCE SECRETARY: I think it's very hard for anybody to rally to the support of somebody who's admitted multiple iterations of a crime.

ZELENY: The White House later clarifying in a statement that "President Trump expects Secretary Ross to exercise his independent judgment, consistent with applicable laws and regulations, to resolve the regulatory action involving ZTE based on its facts."

In February, the heads of U.S. intelligence warned Congress about the cyber security threat ZTE poses.

SEN. TOM COTTON (R), ARKANSAS: Would you please use your hands if you would use products or services from ZTE? None of you would. Raise your hand if you would recommend that private American citizens would use Huawei or ZTE products or services. None of you, again, are raising your hand.

ZELENY: The top Democrat on the House Intelligence Committee citing these warnings in a tweet Sunday criticizing the president, charging that Mr. Trump "should care more about our national security than Chinese jobs."

The administration is currently involved in high-stakes trade talks with China. But the U.S. is also counting on trying to help in the historic summit with Trump and North Korean leader Kim Jong-un next month.

President Trump tweeting Sunday that "Past negotiations have been so one-sided in favor of China for so many years that it is hard for them to make a deal that benefits both countries. But be cool. It will all work out."

All of this playing out as the administration faces ongoing criticism for their silence over White House aide Kelly Sadler's morbid remark about Senator John McCain's opposition to the president's pick for CIA director, noting he's dying anyway.

GRAHAM: It's a pretty disgusting thing to say. If it was a joke, it was a terrible joke. I just wish somebody from the White House would tell the country that was inappropriate. That's not who we are.

ZELENY: A source tells CNN that Sadler told McCain's daughter in a phone call that she would publicly apologize for the remark, but she has yet to do so.

[06:05:03] MEGHAN MCCAIN, DAUGHTER OF SEN. JOHN MCCAIN: I don't understand what kind of environment you're working in when that would be acceptable, and then you could come to work the next day and still have a job.

ZELENY: The White House focusing more on the leaking of the comment than its substance, with aides telling CNN that press secretary Sarah Sanders berated the communications staff over the leak on Friday.

(END VIDEOTAPE)

ZELENY: Now, even as that controversy is still hanging over the White House as a new week begins here, it is all a discussion of focus on the looming trade war, potentially. Chinese president's top economic adviser is coming here to Washington this week to talk about this.

And Chris and Erica, so important to remember all of this coming against the backdrop when the U.S. needs China's help in setting up that historic summit next month in Singapore with Kim Jong-un. That is one reason many people here were surprised to see that a new language over the weekend from the president. We'll see what he says today.

CUOMO: Got a converging interest there, as well, but you're right. A lot of tentacles here. Jeff Zeleny, thank you very much. Happy Monday. Let's bring in CNN political analysts John Avlon and Karoun Demirjian.

Good to see you both.

The China ZTE-U.S. situation is complicated. We've got to get into it and look at all these different things. So let's dispense with the easy stuff first.

You're not getting an apology out of the White House, John Avlon, because Trump sees apologies as weakness.

JOHN AVLON, CNN POLITICAL ANALYST: Yes.

CUOMO: And he's clearly OK with what was said about McCain. And the prima facia case for that is he would have said something about it by now if it didn't square with what he believes. Fair point? AVLON: Totally fair. Tone comes from the top. This is something the president has effectively sanctioned by not condemning it. And so have the staff and the senior staff, who have rallied around her.

They've said the real outrage is the leaks. That may be, though it's preoccupying them. But obvious real outrage is someone disrespecting a dying American hero and not being called on the carpet.

HILL: We should also point out, too, that you know, at this point, despite all of these calls for an apology, even if an apology came -- you're looking at this. It's almost -- it would feel to be this disingenuous apology. Like when you tell your 3-year-old, apologize, "Say sorry, say sorry." That doesn't teach anybody anything, and it certainly doesn't accomplish a real apology if you're just saying it to say it.

KAROUN DEMIRJIAN, CNN POLITICAL ANALYST: No, an apology withheld is an apology that becomes insincere. And it's been several days now that we've been looking at this back -- going back and forth.

Look, as John pointed out, it's an American war hero that he -- she criticized in a very crass way. But remember, this is the president who also said he prefers people that aren't captured. It's not the first time that we've heard disparaging comments made about John McCain coming out of the White House, and it's not the first time people have called on the president to apologize for things that come out of his staff, his team, and he won't do it.

So this is a reminder of all that. It's also just a more egregious situation, given the health situation that Senator McCain is in and the sympathy that everybody has for him and his family right now who's watching this from both sides of the aisle.

CUOMO: All right. So now what is complicated is what's going on with China. We had there in the piece, if you were paying attention this morning, Rick [SIC] Cotton, who has been a bold supporter of the president there when they were considering the initial sanctions against ZTE, asking that chain of command, "Do any of you think we should be dealing with ZTE?" None of -- nobody would say yes. So this was a no-brainer.

What made it such an obvious choice for reversal by the president of the United States, John?

AVLON: This is kind of stunning, because the Trump team has been tough on China. They've been tough on cell-phone manufacturers, who in the case of ZTE, have brazenly avoided sanctions against Iran, another prime target of the Trump administration, and also been implicated in spyware, you know, concerns, real vulnerabilities with the infrastructure.

All of a sudden, for the president to be tweeting out too many jobs in China have been lost. That's pretty much -- that's a distillation of the opposite of all of his campaign promises. Being tough on China, looking out for American jobs. Look, he's gone out of his way to say that Xi is his friend. It's a

preamble to these talks coming up and the North Korea summit. But this focus on Chinese jobs all of a sudden is an abrupt about-face. And you've got to see, there's going to be a lot of questions in Congress about this.

HILL: Well, you also, to your point, looking here at Chinese jobs, all of a sudden. We're so concerned about Chinese jobs, as opposed to jobs here in the U.S. You can't ignore the headline of "Are Chinese jobs more important than security in the United States?

DEMIRJIAN: No. It's a difficult headline to avoid, especially because so many of the president's close allies -- Tom Cotton is an ally of the president -- have said this is a line that you should not cross. Because ZTE, companies are concerned about using, you know, their technology to spy on Americans and potentially American government, as well.

There's also something about the whole back and forth about Chinese jobs that becomes -- you have to raise questions about why is the Chinese government backing this particular company so strongly?

Yes, it's a very large company, 75,000 employees. Yes, it's connected globally. And there would be shocks that would be felt through the technology economy around the world, if it fails. But the Chinese government is clearly going to the wall and the matt for this particular company, which adds some fuel to the national security concerns.

And even though, yes, a lot of Trump's policy maneuvers right now on the global stage are riding on China cooperating. There has to be some school of fact that says, if you just tweet about what you're going to hand out, you kind of lose a little bit of your bargaining position there. And then that -- this adds more to the fuel to the flame of, you know, what is he doing in a national security sense if he is just kind of giving this present now to China.

[06:10:15] Are the negotiations done? If they're not, then it seems like a pretty big bargaining chip was just taken off the table.

CUOMO: He said be cool, Chris. Bee cool. I like "be cool" in the president's tweet. I'd like "best not be messing with us" when he was talking about North Korea. I like when he slips into some street.

I think that this is also an obvious play to hedge on bad implications to U.S. businesses here, John. ZTE sells a lot of parts to Qualcomm, which won't jump out to people. But they put out a lot of devices. And they're worried about a trickle down here. And that's an interesting finesse part of trade. Right? It's easy to say "China is raping us" in a campaign. But then once you start to look at how intertwined the economies are, what you do to them often reverberates.

AVLON: This shouldn't take tutorial real-time president of the United States. This is the problem with free trade. This is the problem with protectionism. We do have an interconnected global economy. And when you punch -- when you punish a foreign company, frequently it's American workers who get hit in the face. So this is the problem with that, stands from the beginning.

The trickier problem, the more significant one, is one, this is a company that has violated Iran trade sanctions at a time when they're trying to ramp up sanctions on Iran.

And two, the issue of technological spyware by China. Trump has been -- the team has been very tough in following through on tough talk and trying to throw brushback pitches about their, really, manipulation of the U.S., and they're building a surveillance state. This contradicts all of that.

Maybe it makes North Korea negotiations easier. Maybe it avoids a trade war at a tricky time. But it does contradict the core principles the Trump team is pursuing.

HILL: And bottom line, too, is there a sense of what the U.S. would actually get out of this? I mean, what's the up side?

DEMIRJIAN: Well, I mean, I think policy-wise, the upside is that you cannot really do this negotiation with North Korea, even if South Korea is behind it, even if the people that the leaders of the two states are supposed to meet face-to-face without having China's backing. Because China and Russia have been fueling the North Korean economy for a very long time, letting them get around sanctions, letting them avoid this sort of denuclearization talk for years and years.

Also, I mean, as we were just talking about, as John was just mentioning, there is a blowback to the U.S. economy, too. If this very, very large tech giant -- not just in China but in the world -- failed, a lot of other pieces will crumble with that, too.

And so you're kind of left with, is this question of, OK, well, which is the more pertinent, more -- more urgent national security concern? Is it the economic concern, which is a national security concern? Is it the idea that North Korea might have a nuclear weapon? Or is it the fact that China might spy on us?

And it seems like it's, unfortunately, enough to -- they are weighing one against the other right now. And depending on where you're sitting, naming which one is the biggest concern is not actually something that everybody who might come down on the same side of that debate.

HILL: Fair point. All right.

CUOMO: So that is a good start to the week. We've got some big news, though, that's going to break on your watch this morning.

DEMIRJIAN: That we do. In just a few hours, U.S. and Israeli officials will attend the opening ceremony for the new U.S. embassy in Jerusalem. Demonstrations already under way, clashing along the Gaza border, away from Tel Aviv.

CNN's Elise Labott is live at the embassy. Elise, good morning.

ELISE LABOTT, CNN GLOBAL AFFAIRS CORRESPONDENT: Good morning, Erica.

Well, the mood inside the embassy in Jerusalem from Israel and Israelis is really jubilant. This is a long day that has been long coming. And as Prime Minister Netanyahu said, it's an emotional day. The -- Israel's closest ally would be recognizing Jerusalem as their capital.

But as Israelis are celebrating, it is a crushing blow to Palestinians who see this as a terrible sign of disrespect from the U.S. And they will be out today en masse, making their frustrations felt.

(BEGIN VIDEOTAPE)

DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: Today we finally acknowledge the obvious, that Jerusalem is Israel's capital.

LABOTT (voice-over): The Trump administration upending decades of established American policy, officially moving the U.S. embassy in Israel from Tel Aviv to Jerusalem. Israeli Prime Minister Benjamin Netanyahu praising the move while kicking off a gala attended by Ivanka Trump, Jared Kushner, and Treasury Secretary Steve Mnuchin.

BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: Thank you for your bold decision. Thank you for making the alliance between Israel and the United States stronger than ever.

LABOTT: The Israeli people also celebrating the occasion. Pro-Trump signs a signal of President Trump's growing popularity in the country less than one week after the U.S. withdrew from the Iranian nuclear deal.

The move expected to trigger widespread protests among Palestinians, who were infuriated when President Trump announced the decision in December.

MAHMOUD ABBAS, PALESTINIAN PRESIDENT (through translator): With this step, the U.S. has chosen to lose its confidence as a mediator and to disqualify itself from playing a role in the peace process. We shall not accept any role for the United States in the peace process.

LABOTT: Israel nearly doubling its troops around Gaza and in the West Bank amid escalating tension in the region. The State Department also bolstering security at U.S. diplomatic posts around the Muslim world.

(CHANTING)

LABOTT: Still, U.S. and Israeli officials insisting that moving the embassy will advance peace in the region.

UNIDENTIFIED FEMALE: Will that make it harder or easier to get any sort of peace?

BOLTON: I think it will make it easier. I think recognizing reality always enhances the chances for peace.

LABOTT: The Trump administration has invited two controversial U.S. pastors to participate in today's ceremony, despite their inflammatory past comments.

JOHN HAGEE, EVANGELICAL PASTOR: Then God sent a hunter. A hunter is someone who comes with a gun, and he forces you. Hitler was a hunter.

DR. ROBERT JEFFRESS, RADIO/TV HOST: Mormonism is wrong. It is a heresy from the pit of hell.

Mormonism is wrong. It is a heresy from the pit of hell.

LABOTT: Former Republican presidential candidate Mitt Romney, a Mormon, condemning Robert Jeffers' participation, tweeting, "Such a religious bigot should not be giving the prayer that opens the United States embassy in Jerusalem."

Pastor Jeffers addressing the controversy ahead of the ceremony.

JEFFERS: Well, first of all, these were comments ripped out of context from years ago. Secondly, you know, historic Christianity for 2,000 years taught that salvation is the faith in Christ alone. And the fact that I and tens of millions of evangelical Christians still believe that is not bigoted, and it's not newsworthy.

(END VIDEOTAPE)

LABOTT: Now, obviously, a very highly significant move. But for now, mostly a symbolic one. There's a sign that says "U.S. Embassy," and Ambassador David Friedman will have an office here but je will not be based at the embassy here permanently. His staff will not be here. And Ambassador Friedman will not live here.

It will take at least a year for the embassy to have enough upgrades to bring over a staff and to have classified communications; and then, of course, to build and construct a U.S. embassy compound will take several more years, Chris.

CUOMO: Right. And obviously, the paramount concern will be security. This is a volatile move. They have to worry about what comes next.

Thank you very much. And great for you to be there for such an historic occasion.

All right. So will keeping his promise to move the U.S. embassy in Israel hurt President Trump's other promise to seek peace in the Middle East? We're going to discuss this with formal special envoy there. George Mitchell, next.

(COMMERCIAL BREAK)

[06:21:29] CUOMO: President Trump fulfilling another campaign promise, and this one very bold, as the U.S. opens an embassy in Jerusalem. What will happen after this? And what will it mean for peace in that region?

Joining us now is former Senate majority leader George Mitchell. He served as U.S. special envoy to the Middle East in 2009 to 2011.

Always a pleasure, sir.

GEORGE MITCHELL, FORMER U.S. SPECIAL ENVOY TO THE MIDDLE EAST: Thank you.

CUOMO: Thank you for being in this morning. So let's just start outside. We'll move inside. Why did the president make this move?

MITCHELL: Well, many presidents have made the promise. He made the move. My own view is that Jerusalem has been, is, and will always be the capital of Israel. There's really no doubt about that, and it's widely accepted around the world.

The only question is whether Jerusalem, in its east side, East Jerusalem, will become the capital of a Palestinian state, an independent sovereign non-militarized Palestinian state.

Under several presidents of both parties for many years, American policy has been that that issue and all major issues between the Israelis and Palestinians should be decided by them, in direct negotiations, with the assistance of the United States. And to implement that, the United States has a policy of refraining from deciding these issues independent of those negotiations.

It has been the policy of the Trump administration. The president says he has a plan to bring the parties together in negotiations to get an agreement. Unfortunately, this decision, while confirming a reality, does not advance the process. In fact, it undermines the president's own effort to get the parties together, because it makes it less likely that there will be negotiations or a two-state solution.

CUOMO: So we've seen Republican and Democrat presidents do what essentially is a punt. You have the authorization to do this, but they don't do it. They take a waiver on it each time. Because they're basically holding it in abeyance until the two parties make their own decision.

Trump has taken a different path. What's the up side for him?

MITCHELL: Well, the up side is, of course, as you can see, the celebration in Israel today. It's very popular in Israel and, I think, among many in the United States.

But in the long run, it will not advance the peace process. It will make his own policy more difficult to achieve and implement. That's the real issue. And it greatly inflames an already very turbulent, violent region, and it increases, in conjunction with the reversal of the Iran nuclear agreement, it tremendously increases the instability and the likelihood of wider war in the Middle East.

CUOMO: So you believe that there is a chance that you have some type of negative/hostile reaction to this move by the United States?

MITCHELL: Oh, yes. It's already --

CUOMO: Not just protests. I mean, something that would be organized, something that would be, you know, a show of force against this.

MITCHELL: Well, it's impossible to know exactly how and precisely for what reason things might break out. But, yes, I think the chances of a wider conflict in the Middle East have increased significantly.

Listen, there are two ways you can get Iran -- to prevent Iran from getting a nuclear weapon by negotiation or by war. Now, the president says he wants a negotiation now, wants to bring them around back in to get, quote, "a better deal." I think that's very unlikely.

[06:25:06] Remember, this is not just the U.S. and Iran. This is China, Russia, Britain, France and Germany. All of them have said they will not engage in further sanctions and further negotiations.

CUOMO: Well, but that's punitively what's going to happen. Right? Because Iran has you have 60 days to figure out how to make this deal. Basically, that means 60 days to figure out what to do with the United States.

I got some heat for this, but I want you to give us a straight move on it. So Trump makes his move, says, "I'm pulling out of this deal the way I always promised you. It's a bad deal. It's a terrible deal. I'll make a better deal." OK. He does it.

We then see missiles land in the Golan Heights. Israel says, "Iran did this, and they did it from Syria. We're going to retaliate." They do.

Do you believe that that increased hostility is an outgrowth of the move? I'm not blaming the United States for what happened. Obviously, that falls on Iran's shoulders. But do you think that the move will trigger more provocative action by an inimical nation in Iran?

MITCHELL: That's possible, even likely. But the reality, of course, is that Iran has been moving missiles through Syria to Hezbollah and southern Lebanon for many years. I had a direct confrontation with President Bashar al-Assad. When I was in the region, we were trying to promote Syria and Israel getting together, as well as the Palestinians in Israel.

I've had several meetings with President Assad, and I directly confronted him on the fact there is a big warehouse in the eastern part of -- the western part of Damascus in through which Iran bring missiles in. They transfer it to Hezbollah. It takes place in Damascus. And the Hezbollah moves him by land across into Southern Lebanon. That's been going on for a long time.

The conflict, the war of words between Israel and Iran has been going on for decades. It is accelerating. And the general circumstances in the region, including but not limited to this action, have created a much more volatile atmosphere in which conflict is much more likely.

CUOMO: So the president says in his sweet this morning, "Be cool." But it does seem the move with the embassy and the move with the Iran deal may have an opposite effect in an already tense situation. We'll have to see what comes next.

MITCHELL: Yes.

CUOMO: He seems to be doing the opposite when it comes to North Korea. That there had been a lot of hot talk, Rocket Man and all that other nonsense. But now it doesn't seem like nonsense, because they all are approaching the table. They're not at the table yet, but they're approaching it. What do you see as the parameters there for the best chance at a positive outcome?

MITCHELL: Well, first, of course, we all must hope and pray that the president succeeds in this effort. It would be a tremendous accomplishment, not just for him personally, but for our country and for peace and stability in that region if North Korea does agree to the full denuclearization.

CUOMO: So that's the bar for you? Has to be about nukes? Can't be anything short of it.

MITCHELL: Think about this now. Kim Jong-un has already achieved two of his principle objectives before the first meeting has been held.

The first is a meeting itself. Every North Korean leader has sought a meeting with the president of the United States. No prior presidents agreed to it because it will, of course, place the North Korean leader on equal footing with the president of the United States. So that's a huge accomplishment for Kim Jong-un.

The second accomplishment he already has is that, until now, full denuclearization by North Korea has been the precondition of getting into talks. Let's see what happens. My own preference would have been that the president would follow the more traditional method of beginning the negotiations at a lower level and, when there is promise there, then to have the two leaders meet in a concluding ceremony, when you have much more likely to get a positive result, nonetheless, the process is underway.

I think every American should hope and pray for success. It will be a tremendous achievement in that region, although the way it's approached makes that unlikely. Now, nonetheless, it remains we should hope for it succeeding.

CUOMO: All we know for sure is that all prior efforts have failed. So they'll try something different. Hopefully, they get a better outcome.

MITCHELL: But now they have failed, because the North Koreans had not kept their word.

CUOMO: Right.

MITCHELL: They've made agreements before that they haven't kept. They argue that -- they argued the reverse, that the United States didn't keep its word. So there's nothing new about North Korea reaching agreements. What will be new, is if the agreements are adhered to and there was the full denuclearization of North Korea. CUOMO: Senator Mitchell, thank you so much for your perspective. You

make us better every time -- Erica.

HILL: A new terror attack rocks Indonesia just 24 hours after a family's weekend bombing spree of churches. The disturbing new details we're learning, next.