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EARLY START

Trump Shifts Focus To Democrats, Washington Awaits Mueller Probe Arrest; Sparring Over Tax Plan; House GOP Concedes On Property Tax Deduction; Trump Leaning Toward Powell To Run Fed; Questions Mount Over Puerto Rico Energy Contract; Two Navy SEALS Under Investigation; Astros Beat Dodgers In Instant Classic; Global Markets Mixed. Aired 4:30-5a ET

Aired October 30, 2017 - 04:30   ET

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


[04:30:17] DAVE BRIGGS, CNN ANCHOR: Happening as soon as today, the first arrest may be imminent in the Russian investigation after a federal grand jury has approved its first charges.

CHRISTINE ROMANS, CNN ANCHOR: The Trump administration bracing for the first arrest in the Mueller probe, but the President is shifting focus to none other than Hillary Clinton. Welcome back to Early Start I'm Christine Romans this Monday morning.

BRIGGS: I'm Dave Briggs. It is 1:30 in L.A. where they are hurting from the game of the World Series is, which we will show you in a bit. But first this morning Washington on edge waiting for possible arrest in Special Counsel Robert Mueller probe in Russian interference in the 2016 election. The CNN first reported on Friday that a federal grand jury has approved the first charges in the Russia investigation. That indictment is still sealed. We don't know what the charges are or who they target.

ROMANS: Special counsel's team has examined foreign lobbying by former Trump Campaign Chairman Paul Manafort and former National Security Adviser Michael Flynn. They are looking at whether the President's firing of FBI Director James Comey amounted to obstruction of justice.

BRIGGS: Many are wondering whether the President might pardon some or all of Mueller's targets or whether he might fire Mueller himself. This as the Wall Street Journal editorial board calls on Mueller to resign.

ROMANS: Meantime some Republican leaders say the Trump administration should let the Mueller probe take its course. Those targeted by special counsel should take it seriously.

(BEGIN VIDEO CLIP)

REP CHRIS CHRISTIE, (R) NEW JERSEY: Anybody who has been advised by special counsel's office that they are targeting the investigation, which I'm sure he has done to those people who are, should be concerned. REP TREY GOWDY, (R) HOUSE OVERSIGHT COMMITTEE, CHAIRMAN: I would

encourage my Republican friends, give him a chance to do his job. The results will be known by the facts by what he uncovers. The personalities involved are much less important to me than the underlying facts. I would say give the guy a chance to do his job.

(END VIDEO CLIP)

ROMANS: The latest now from CNN Crime and Justice Reporter Shimon Prokupecz.

(BEGIN VIDEO)

SHIMON PROKUPECZ, CNN CRIME AND JUSTICE REPORTER: Dave and Christine, we expect to learn later today what charges were filed in connection with the special counsel investigation. Once a federal Judge unseals the indictment, a federal grand jury as reported on Friday, has approved this charges and Special Counsel Robert Mueller's probe. The charges are sealed, so we don't yet know who will be charged.

We had been told the expectation is that it was going to happen Monday. Now, anyone who is facing charges will be arrested and taken into custody by FBI agents and at some point will face a Judge here in Washington, D.C. Now, this indictment, once it's unsealed, will give us a window into what special counsel has been looking at and how it potentially relates to the Russia investigation. Dave, Christine.

(END VIDEO)

BRIGGS: President Trump apparently frustrated by the news of Russia probe, looming over the whole weekend. No surprise he has been pushing back hard taking aim at Hillary Clinton on twitter.

ROMANS: All right here it is, ready? We have never seen such a Republican anger and unity as I have concerned of lack of investigation on the Clinton-made fake dossier, now $12 million. That is the reference to the speculation on the cost of the dossier.

Uranium to Russia deal, the 33,000 plus deleted e-mails, the Comey fix, and so much more. Instead they look at phony Trump Russia collusion, which doesn't exist. Dems are using this terrible and bad for our country. Witch-hunt for evil politics. But the r's, Republican are now fighting back like never before. There is so much guilt by Democrats/Clinton, and now the facts are out. Do something. More now from CNN Boris Sanchez at the White House.

(BEGIN VIDEO)

BORIS SANCHEZ, CNN ANCHOR: Dave and Christine. No public events for the White House on Sunday, however the president was very active on twitter, fired up over what he calls a lack of investigations into Hillary Clinton and the Democrats in a series of tweets he specifically cites several allegations that he has made in the past about Clinton, including about that now infamous dossier that was put together by fusion GPS, the company at one point was hired by the Clinton campaign to produce opposition research against then candidate Trump. He also mentions this uranium deal, the allegation that Hillary Clinton as Secretary of State took bribes from Russian officials in order to give them more favorable deal for uranium.

We had a chance to ask Ty Cobb, the White House attorney about the President's tweets and whether or not they were coming because of the recent news in Robert Mueller's Russia probe. Ty Cobb denied that, saying that the President's statement has nothing to do with that, but it is difficult to imagine that these investigations are not on the President's mind.

[04:35:08] He is clearly unhappy about being investigated. Officials in his campaign being investigated for allegedly colluding with Russians to help the Trump camp win the 2016 election. The interesting thing about this is the timing. He is attacking an opponent that he defeated almost 12 months ago. Dave and Christine.

(END VIDEO)

ROMANS: That is very true. It is the Trump administration not the Clinton administration.

This week tax reform gets real folks, on Wednesday the House GOP finally unveiled its bill tax writer had already back up. One of their most controversial proposals, a full repeal of the state and local tax deduction. Instead the bill will now allow a deduction for property taxes, a concession to lawmakers in high-tax states like, there is no tax breaks though for states and local income taxes or general sales taxes. So expect some outcry over that.

Speaking of outcry, the national association of home builders, says it opposes this bill, it is pledging to fight the legislation, because it doesn't contain a new tax credit for home ownership. That is just beginning when the bill drops. Get ready for what will look like at the corporate hunger games as an army of lobbyist descend Capitol Hill and a desperate fight to preserve their pet tax breaks. Every single one of these tax breaks has a constituency and a lobby as attached.

BRIGGS: And that would be this fight to place on the next couple of weeks. Meanwhile Obamacare opening Roman kicks off this week. The President Trump doesn't seem so eager to help American sign up. Tweeting as usual, the Obamacare premiums will be up. The Dems own it. But we will repeal and replace that great healthcare soon after tax cuts. The administration has taken steps to undermine the markets including getting outreach efforts, but despite those efforts, open enrollment season does begin this Wednesday.

ROMANS: It is still the law of the land, folks.

Former House Speaker John Boehner unleashed in a blast in the current state of affairs in Washington in a profanity laced interview with Politico. Boehner said we've got some of the smartest people in America who serve in the congress, and we've got some of the dumbest. We have some of the nicest people you ever want to meet, some that are Nazi's.

BRIGGS: After that Congressman Trey Gowdy, chairman of the House Oversight Committee, Boehner said we're cleaning this up a bit. Gowdy, that is my guy, even though he doesn't know how to dress. F Jim Jordan. F Jason Chaffetz. They're both a-holes. Boehner tell us how you really feel.

ROMANS: I know. This week President Trump will name his choice to head the Federal Reserve. Two sources tell CNN Trump is leading to Jerome Powell. He has been governor since 2012. Janet Yellen's term as Fed Chief ends in February. She would be the first fed chief in nearly 40 years not to serve a second term. The President seems to have warmed to Yellen recently, he talked about wanting to make his own mark on the central bank. Yellen has favored a gradual approach to raising interest rate as strategy Powell has largely supported him as well.

BRIGGS: Ok. Ahead, questions mounting in Puerto Rico where 70 percent of the island is still without power, over a $300 million contract made with a small Montana energy company. We'll have the latest from San Juan next.

(COMMERCIAL BREAK)

[04:42:33] BRIGGS: This morning Puerto Rico's electric company is set to cancel its huge power restoration contract with a Montana-based utility company at the request of the island's governor. Questions have been is swirling about the hiring the Whitefish Energy. The company is just two years old. It had only two full-time employees on the day the contract was signed. Many of the questions related to the fact that Whitefish is based in a small hometown of U.S. Interior Secretary, Ryan Zinke. CNN's Leyla Santiago is in is San Juan with the controversy.

(BEGIN VIDEO)

LEYLA SANTIAGO, CNN CORRESPONDENT: Dave and Christine, Puerto Rico's power authority has said, it wants to cancel the controversial contract with Montana-based utility company Whitefish energy. This comes on the same day that the governor of Puerto Rico has not only said this contract should be canceled, but he also says there should be a full investigation into the $300 million deal. The contracting process behind it. And the details that led to where we are today. Remember, this is a controversial contract that many believed was a big task for a company that just perhaps wasn't ready to take it on, to restore Puerto Rico's very vulnerable power grid, a company that is only two years old and with very few employees. Now the contract is not canceled just yet. But Puerto Rico had already said that it plans to exercise that cancellation clause in the contract. It will let whitefish carry out its work here in the meantime. As I have been on the streets just today talking to Puerto Ricans, there is a sense of frustration that is just palpable. It has been more than a month since hurricane Maria and many are still without power. Frustrated, because many have lost their jobs, because of businesses that cannot open at this time. On a day when only 29.7 percent of the power generated capabilities is up and running. Puerto Ricans continue their frustration with the power system. Christine, Dave.

(END VIDEO)

ROMANS: On the one hand criticizing too much bureaucracy and red tape. When there wasn't enough bureaucracy and red tape, criticizing that. No suggestion that they aren't doing the work. They are doing the work.

BRIGGS: A rush to judgment in both directions. Unfortunately.

ROMANS: All right we will watch that unfold. 45 minutes pass the hour. Two members of the navy's famed SEAL Team 6 are under investigation for the killing of an army green beret in Mali. A Navy spokesman has confirmed CNN an "NCIS" investigation is under way in the June death of army staff sergeant Logan Melgar. The "New York Times" was first to report a military exam and ruled Melgars' death, homicide by strangulation. The Times report the two SEALS were flown out of Mali after the death and put on administrative leave.

BRIGGS: In other words, he was Special Forces engineer sergeant with the third Special Forces group. That is the primary unit responsible for army special ops in northwest Africa, including Mali and Niger. The four American soldiers killed in Niger earlier this month were part of the same group.

ROMANS: Defense Secretary Jim Mattis and Secretary of State Rex Tillerson set to testify today before the Senate Foreign Relation Committee. Lawmakers looking at whether there is a need for a new, possibly, more specific authorization of the use of military force. The hearing comes amid mounting questions about the extent of military operations in Niger following that ambush that left four American soldiers dead. CNN's David McKenzie is live for us in Niger. Good morning Dave, lawmakers could go out to question what happened in Niger. What's the latest on the investigation there?

DAVID MCKENZIE, CNN CORRESPONDENT: Christine, good morning. Some of the questions might be posted on open session on Capitol Hill later today of the war authorization. But here in the ground in Niger, certainly those questions are continuing the answers seem to be trickling out slowly. The latest we have is that really a dramatic scene of course during this awful ambush of these American soldiers led by green berets. Several of those U.S. Special Forces were separated from the rest of their convoy when that vastly superior, in terms of numbers of force, attacked them several weeks ago. Now that zone of danger is just a few hours from where I'm standing here in the capital.

And those militants threaten both that border region and of course the whole of Niger where there are several hundred U.S. Forces kept. That investigation by the Pentagon certainly will be methodical. It will take more than a month potentially with investigators here on the ground both from the defense department and from the FBI trying to piece together exactly what happened and why those soldiers got into harm's way in what was initially thought to be an advice and assist, stand and patrol, but I have to say, Christine, there have been many attacks in that along that border region against Nigerian soldiers. Just recently 13 military police were killed by suspected militants. So it is a dangerous area. And U.S. Forces are here on the ground. Christine, Dave.

ROMANS: They certainly are. All right. Dave McKenzie, thank you.

BRIGGS: All right we now know the name of the U.S. soldiers killed in the helicopter crash in Afghanistan. The defense department identifying him as 36-year-old Jacob Simms from Juneau, Alaska. He was killed when a chopper went down in Afghanistan on Friday. Six other U.S. Crew members were also injured. They're undergoing medical treatment. The Pentagon said the crash was not the result of enemy action and is under investigation.

ROMANS: An investigation under way in London after a man said he found an usb memory stick on the street belonging to Heathrow international airport. It held security files including the route the queen takes when she uses the airport and maps pinpointing is surveillance cameras. The device is also have included a network of tunnels and escape routes. London police tells CNN no crime was reported but Heathrow airport officials didn't alert them that the memory stick was recovered. Can you imagine? Just found on the street.

Maryland is investigating part of Jared Kushner's family business by the State Attorney General looking at certain apartments. Check on CNN Money Stream next.

(COMMERCIAL BREAK)

[04:53:22] ROMANS: Houston Astros just one game away from winning the first world series after a phenomenal game in Houston ending just a few hours ago. It was looking like a home run derby mid game. Astros Gurriel tying the game with this three-run home run. Then the Dodgers fire back with another grand slam taking the lead in the fifth, but the Astro weren't done, another three run home run by Gurriel.

BRIGGS: Two base.

ROMANS: Oh two base. Tying the game yet again.

BRIGGS: All 5'6" of them. By the 9th Astro led 12-9. Dodgers manage to stay alive. Two-run shot by Puig. And this hit to center tying the game. Then comes the Astros Alex Bregman sealing Houston's victory in the 10th with the walk-off. Astros lead the series 3-2. Dodgers hopes to even the score back home in L.A. tomorrow night, Justin Verlander on the hill for Houston.

ROMANS: Houston Texans players sending a message Sunday to the team owner after his controversial remark about player protests on the national anthem on Friday became public that the team owner said, "we can't have the inmates running the prison." he said that during the NFL owners meeting about the ongoing protests. McNair suppressed regrets to his team on Saturday. It wasn't enough. All but 10 players took a knee or sat during the anthem in what was by far the largest single team protest yet.

[04:55:00] BRIGGS: Actress Rose McGowan speaking out publicly for the first time since allegations of sexual misconduct emerged about Hollywood Mogul Harvey Weinstein. The actress giving a rousing speech on Friday to women's convention in Detroit, Michigan.

(BEGIN VIDEO CLIP) ROSE MCGOWAN, HOLLWOOD ACTRESS: Good morning, women. I've been

harassed. I've been maligned. You know what, I'm just like you. Because what happened to me behind the scenes happens to all of us in this society. And that cannot stand and it will not stand.

(END VIDEO CLIP)

BRIGGS: Through her lawyer, McGowan told the "New York Times" she was offered $1 million in hush money from someone in Weinstein's inner circle just as women were about to start coming forward against Weinstein.

ROMANS: All right. 55 minutes past the hour. A little bit of weather here. More than a quarter million of people lost power as a big storm hit the northeast Sunday. I should say lost power, still don't have power.

BRIGGS: Me either.

ROMANS: Right now, 45 million people under a flash flood watch. That means a tough morning commute across the region on the fifth anniversary of superstorm sandy. Meteorologist Karen McGinnis has the latest.

KAREN MCGINNIS, CNN METEOROLOGIST: Some of the highest wind and heaviest rainfall Dave and Christine. We saw it right across Rhode Island, Connecticut, and eastern Massachusetts. This an amalgamation of systems. Some leftover energy coming from tropical storm Philippe. The frontal system swept along the eastern seaboard. Look at some of the wind gusts that we had. Still wow, 124 miles per hour. Otherwise, we typically saw those wind reports between 60 and close to 70 miles per hour in Tauten, Massachusetts, providence, Rhode Island. Numerous wind reports and wind damage reports. Downed trees, downed power lines. Rivers and streams filling up, because we have already seen, some cases two, three inches of rainfall with an additional two to four inches possible. The storm system does begin to pull away. You will see the rain taper off, the wind taper off. That will be the good news. But there's going to be plenty of damage in the early morning. We can see what damage is left over. New York City, 50s shooting up to 60s by Thursday. Back to you guys.

ROMANS: All right. Karen, thank you for that. Let go check CNN "money" stream, global stock markets are mixed. U.S. Futures looking, I'll call that flat. Stocks may take a breather after Friday's power rally on the NASDAQ. Did you see this, it jumped 2 percent, its biggest one-day gain in a year. Investors cheering strong quarterly results from tech giants, Amazon, Microsoft and the Google paired alphabet. The S and P 500 are record high as well.

Maryland is investigating one of the Kushner family real estate businesses. Earlier this year media reports about the alleged abuse of death collection practices and poor conditions at some of its properties there. The Kushner companies said it is cooperating with Maryland Attorney General says that they are in compliance with all state and local laws. Jared Kushner stepped down as CEO of Kushner Company when he joined the White House in January. He is President Trump's son-in-law and top adviser to the President. Kushner recused has himself on certain policy issues. But they remain under increased scrutiny given his proximity to the President.

Facebook is outlining new steps to make ads more transparent comes amid ongoing concern Russia used Facebook to influence last year's election. The social media giant will require political advertisers to verify their identities and labeled who paid for the ad. You can click on the disclosure to see even more information about the advertisers. Facebook is also building an archive of election ads the new efforts will begin testing in Canada next month. This week, Facebook, twitter, google will head to Capitol Hill to answer questions about Russian meddling in the election. All three companies acknowledge they sold political ads to Russian agents.

BRIGGS: You need users to scrutinize things. Are they going to click on a link that gives them transparency?

ROMANS: I'm so surprised just how much just false information I see people sharing. And people get fired up about it.

BRIGGS: All right "Early start" continues right now with the latest. The special counsel investigation.

Happening as soon as today. The first arrest may be imminent in the Russian investigation. After a federal grand jury has approved its first charges.

ROMANS: The Trump administration bracing for those first arrests in the Mueller probe. The President shifting focus, he is shifting focus to none other than Hillary Clinton. Good morning, everyone. Welcome to "Early start" this Monday morning. I am Christine Romans.

BRIGGS: I am Dave Briggs it is 5:00 a.m. in the east, 4:00 a.m. in Houston Texas where the Astros won a wild game five of the World Series, it has been an incredible series. But we start this morning with Washington. On edge waiting for possible arrest in Special Counsel Robert Mueller Probe of Russian...