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EARLY START

Flynn Fallout; Tax Battle; The Return Of Billy Bush; Comey Defends FBI in Tweet; Congress's Dueling Tax Bills; Major Healthcare Acquisition; SNL Takes On Michael Flynn; Met Opera Director Suspended Amid Sexual Abuse allegations; Auto Sales Decline In 2017. Aired 4:30- 5a ET

Aired December 4, 2017 - 04:30   ET

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


(COMMERCIAL BREAK)

[04:30:28] DAVE BRIGGS, EARLY START SHOW CO-HOST: President Trump directs his wrath at the FBI after Michael Flynn pleads guilty to lying in the Russia probe. Now obstruction charges to hinge on a tweet that raise questions about why the President fired James Comey.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: The tweeting comment regarding an ongoing criminal investigation at your own peril, I'd be careful if I were you, Mr. President.

(END VIDEO CLIP)

CHRISTINE ROMANS, EARLY START SHOW CO-HOST: A bruising battle over taxes moves on to the next phase. The house and senate start to reconcile their two pretty different bills. We'll tell you where the GOP has big gaps to close.

BRIGGS: And Billy Bush is back out of the shadows in a scathing op- ed. He makes clear the President did say exactly what you hear on that "Access Hollywood" tape. What else will Billy Bush have to say on "The Late Show" tonight should be intriguing.

ROMANS: Quite a 13 months for him.

BRIGGS: It sure has. Welcome back to "The Early Start." I am Dave Briggs.

ROMANS: I am Christine Romans, nice to see you on this Monday morning, 31 minutes past the hour. Let's begin with the President. President Trump returning to an old playbook following the newest criminal charges in the Russia probe. He is lashing out at the intelligence community, this after a former national security adviser Michael Flynn pleaded guilty to lying to the FBI about li his discussions with the Russian ambassador during the transition.

BRIGGS: In a series of tweets over the weekend, the President attacked the FBI and its former Director James Comey. In one he writes, "I never asked Comey to stop investigating Flynn. Just more fake news. Covering Comey lie. That puts the President directly at odds with what Comey told congress in June.

(BEGIN VIDEO CLIP)

JAMES COMEY, FBI DIRECTOR: I understood him to be saying is what he wanted me to drop any investigation connected to Flynn's account of his conversations with the Russians.

(END VIDEO CLIP)

ROMANS: President Trump's most notable tweet on Flynn turning states evidence came Saturday, quote, I had to fire General Flynn, because he lied to the vice President and the FBI. He has plead guilty to those lies.

BRIGGS: Critic's quickly pounced saying if he fired Comey knowing the FBI was investigating Flynn. That on its own may constitute obstruction of justice. The President's personal lawyer John Dowd now claims he drafted the President's tweet. Something we haven't heard in his 10 months in office, but top Democrats in congress say obstruction is very much a part of the wider investigation.

(BEGIN VIDEO CLIP)

SEN DIANNE FEINSTEIN, (D) CALIFORNIA: The judiciary committee has an investigation going as well. And it involves obstruction of justice. And I think what we're beginning to see is the putting together of case of obstruction of justice.

(END VIDEO CLIP)

ROMANS: President Trump now looking to shift the focus, seizing on the news that a member of special counsel Robert Mueller's team was removed over anti-Trump sentiments he had expressed. For more on that, let's bring in Jeremy Diamond at the White House.

(BEGIN VIDEO)

JEREMY DIAMOND, CNN WHITE HOUSE REPORTER: Good morning Christine and Dave. The President spent part of his weekend on social media attacking the FBI after special counsel Robert Mueller and his investigation filing its first charges against the Trump administration official, of course that is Michael Flynn, the former national security advisors who on Friday pleaded guilty to lying to the FBI. And the President picking up on a different story this weekend to go after the FBI's reputation saying that it is in tatters. This is regarding an FBI agent who is detailed to Special Counsel Robert Mueller's team.

He sent text messages to another FBI agent that could be interpreted as anti-Trump or pro Clinton. These were text messages sent during the 2016 election. The President in a one of the series of tweets, well here is what he said, tainted, no, very dishonest. FBI agent's role in Clinton probe under review led Clinton e-mail probe. That is because this agent in fact is one of the lead investigators on the Clinton investigation. The Justice Department's inspector general is now investigating the

handling of that investigation, but the President's tweets this weekend appearing to hit at the FBI's reputation. As he said, it was in tatters. And that led to former FBI Director James Comey who feuded in the past with the President. The President actually fired Comey. Comey took to twitter to defend the FBI. Here was his tweet. I want the American people to know the truth. The FBI is honest. The FBI is strong. The FBI is and always will be independent. Christine and Dave? Back to you.

(END VIDEO)

[04:35:00] BRIGGS: Jeremy Diamond at the White House. Thanks.

FBI agent's association joining Comey in defending the men and women of the bureau. In a twitter statement, the group's President said every day the FBI special agents put their lives on the line to protect the American people from national security and criminal threats. This is why the FBI continues to be the premier law enforcement agency in the world. FBI agents are dedicated to their mission suggesting otherwise is simply false.

ROMANS: Former Attorney General Eric Holder also weighing in. Nope, not letting this go. The FBI's reputation is not in tatters. It's composed of the same dedicated men and women who always work there and do a great job, a great a political job. You'll find integrity and honesty at FBI headquarters and not at 1600 Pennsylvania Avenue right now.

BRIGGS: Not commenting thus far, current Attorney General Jeff Sessions who is dealing with inconsistent of his own over the meetings with the Russian ambassador.

ROMANS: Michael Flynn's plea deal raises a host of questions. Why did the former national security adviser feel he had to lie to the FBI about contacts with the Russians? E-mails obtained by "The New York Times" show Flynn and others on the transition team strategizing about how to reassure the Russian ambassador after the Obama administration imposed sanctioned for Russia's attempts to meddle in the election.

BRIGGS: The emails directly contradicts White House efforts to portray Flynn as acting alone. Trump supporters spent the weekend pushing the notion that it is not unusual for incoming administration officials to speak with foreign governments.

ROMANS: Another big question, why did first son-in-law Jared Kushner, a top White House adviser, direct Mike Flynn to contact Russian officials? Democrats on both the house and senate intel committee say they want Kushner who already appeared before both panels to return and answer new questions. Revelations about Kushner have been dribbling out for months now, forcing Kushner and other Trump aides who had denied or down played them to backtrack repeatedly.

BRIGGS: The actions of another key player then transition adviser K.T. McFarland also raising questions. McFarland later became Deputy National Security Adviser under Mike Flynn. "The New York Times" reports that she wrote an e-mail saying that new Russia sanctions were an Obama administration ploy to quote, box Trump in diplomatically. McFarland added that Russia quote, has just thrown the USA Election to him.

ROMANS: Unclear whether she meant the election had in fact been thrown to Trump by Moscow or only that Democrats were painting it that way. Also still unclear, what the Trump team would have gotten for lifting sanctions.

BRIGGS: The House of Representatives returning a day early to cast votes starting to reconcile differences between the house and senate tax reform bills. Republicans hoping to get a bill to the President's desk by Christmas. The 490-page bill passed early Saturday morning unveiled just hours before most had not in fact read the entire bill, the vote and even included a hand scribbled final notes, Christine.

ROMANS: It's a beast. We'll get exactly to what's in it in a minute, but first reaction to the vote that had Republicans cheering and Democrats seething.

(BEGIN VIDEO CLIP)

SEN MITCH MCCONNEL, (R) MAJORITY LEADER: We followed the regular order. There were multiple hearings. Democrats were there. Days of hearings. Days of amendments. The Democrats offered amendments in committee ad nauseam. The process on the floor, the reconciliation process is regular order. That is how they passed Obama care.

ANGUS KING, SENATE INTELLIGENCE COMMITTEE: If that was regular order, I'd hate to see something else. There were no hearings. There were general hearings about tax reform. There was zero hearings on the bill. And even the bill that was reported out by the finance committee was different than what we were handed that we had to vote on a few hours later.

SEN MARK WARNER, (D) VIRGINIA: Friday was my single worst day as a U.S. Senator.

(END VIDEO CLIP)

ROMANS: On his way to New York for three fundraisers, the President told reporters he could accept raising the corporate tax rate from 20 percent to 22 percent despite his long insisting on 20, 35 percent right now. So that is still a big tax cut for businesses and let's be honest, both the House and the Senate tax bill, both promise big corporate tax cuts. It raises the deficit with no guarantee it will raise jobs or wages. There are differences though on key points. There will be changes about what this looks like. This is what we think of your -- this is going to look like. First off, personal tax cuts in the house version are permanent. In the senate bill they expire by the year 2025 also different, individual tax rate, the house has four tax bracket, the senate keeps seven. The senate lowers most race including the top earners. You can see 38.5 percent is the top bracket in the senate.

The senate version also keeps popular tax breaks that the house eliminates like deductions for mortgages, medical expenses and student loans. While both increase the child tax credit, the senate bill is more generous for parents.

[04:40:02] One thing both versions agree on, permanent corporate tax cuts, the GOP argues that will mean higher wages for you. There is no guarantee. In fact the current tax plan likely raise taxes for some. By the way for those earning less than 30,000 a year, by the year 2027 all low income and middle class Americans pay more. And a lot of this has to do with what happens with Obamacare, repealing the Obamacare mandate, do they keep that?

BRIGGS: Is that the biggest obstacle you think?

ROMANS: I thought the biggest obstacle is going to be the 20 percent corporate rate. Now the President said he would accept 22 percent. That is out of the way. I think health care is the hard part here.

BRIGGS: Should be big debate, but something is getting through.

Looks like Billy Bush is done laying low in the wake of that notorious Access Hollywood tape which got him fired from NBC. The former co- host starting with a message to President Trump in a form of an op-ed in The New York Times, headline Yes, Donald Trump, you said that. Bush says he was prompted to speak out by news reports suggesting the President is now questioning the authenticity of the tape. Bush says the reports of Trump casting doubt on the tape hit a raw nerve.

ROMANS: Billy Bush writes, every single one of us assumed we were listening to a crass standup act, he was performing. Surely we thought none of this was real. We now know better. I can only imagine how it has reopened the wounds of the women that came forward with their stories about him and did not receive enough attention. This country is currently trying to reconcile itself to years of power abuse and sexual misconduct. The leader is wantonly poking the bear. Bush is set to appear on "The late show" tonight. Tune in for that. We'll have the highlights.

BRIGGS: It has been interesting. You have more than a dozen women who said no one no one listened to us in the wake of this reckoning and all industries these women just feel ignored through all this.

Ahead, President Trump expected to name Jerusalem as Israel's capital this week. But there are strong objections in the Middle East and safety concerns for American personnel abroad. We're live in Jerusalem.

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(BEGIN VIDEO CLIP)

[04:46:31] JARED KUSHNER, PRESIDENT'S SENIOR ADVISER: The President will make his decision. He is still looking at a lot of different facts. When he makes his decision, he'll be the one to want to tell you, not me. So he'll make sure does he that at the right time.

(END VIDEO CLIP) ROMANS: Jared Kushner, the president's senior adviser, says no final

decision has been made, but CNN is told the President is expected to recognize Jerusalem as Israel's capital. The U.S. official say the decision could come as early as tomorrow and overturn 70 years of international consensus. CNN's Ian Lee live for us in Jerusalem, walk us through, just, I guess, how important that would be.

IAN LEE, CNN CORRESPONDENT: There's a reason why previous U.S. Presidents both Democrats and Republicans didn't move the U.S. Embassy from Tel Aviv to Jerusalem, it is because of the possible ramifications of declaring Jerusalem Israel's capital without any peace agreement. First, you have Arab allies, President Trump is trying to cultivate good relations with regional leaders and to some success. But we heard yesterday from the Arab league who condemned any potential move. Egypt did as well. Jordan's foreign minister warned of dangerous consequences that could ignite instability as well as it could damage the peace process. And then you have the Palestinian liberation organization's secretary-general who has been in D.C. talking with administration officials said that if this move is made, that in would disqualify the United States from any role in the peace process.

Noticeably, Israeli officials have remain quiet. Which is unusual because in the past they've enthusiastically advocated for this move. We heard from Jared Kushner. His job would be a lot more difficult in the ultimate deal if this move is made. We're also watching U.S. Diplomatic missions that increased security ahead of any announcement, Christine.

ROMANS: You'll be following it for us. Ian Lee for us this morning in Jerusalem, thank you.

BRIGGS: The CIA Director Mike Pompeo weighing in over the weekend on his boss's prolific twitter habit saying far from making his job harder, it actually yields valuable intelligence. The President heavily criticized last week for retweeting anti-Muslim videos posted by a far right-wing extremist group in Britain. But at a Reagan national defense forum in California on Saturday, Pompeo said this.

(BEGIN VIDEO CLIP)

MIKE POMPEO, CIA DIRECTOR: I have seen things the President has put on his twitter account actually have a real world impact on our capacity to understand what's going on in other places of the world. That is our adversaries responded to those tweets and in ways that were helpful to us, to understand command and control issues, who is listening to what messages, how the messages are resonating around the world.

(END VIDEO CLIP)

ROMANS: One of Pompeo's predecessors differed with current CIA director, sitting next to him at the forum, former CIA Director Leon Panetta said, when you tweet something like that out there you don't know what the consequences are going to be. And the consequences could be lives. Former President Obama taking a shot at his successor's record on

climate change. Mr. Obama was speaking Saturday at an invitation only event in Paris. Reuters reports Obama drew laughs with this comment, I grant you that at the moment we have a temporary absence of American leadership on the issue of climate change.

[04:50:04] BRIGGS: Mr. Obama did say the U.S. is still on track to meet its targeted thanks to the work of some cities, states, and businesses. Mr. Obama did not mention Trump by name. In June, President Trump announced U.S. withdraw from the Paris climate accords.

ROMANS: All right. 50 minutes pass the hour, a wild ride on Wall Street. Michael Flynn's guilty plea and tax cuts rocking the markets. Details on CNN Money Stream. That is next.

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BRIGGS: The news about Michael Flynn's guilty plea broke just in time for "Saturday Night Live." The ghost of Flynn visited Trump in the oval office as in other spirits Billy Bush, Vladimir Putin and one other.

(BEGIN VIDEO CLIP)

[04:55:09] UNIDENTIFIED MALE: Steve Bannon. You're here to save the day with your terrible black magic. Who are you?

(CHEERS)

(APPLAUSE)

(LAUGHTER)

UNIDENTIFIED FEMALE: Dubai, Hillary Rodham Clinton. You, Donald, have given me the greatest Christmas gift of all, sexual gratification in the form of your slow demise. You have no idea how long I've wanted to say this. Lock him up!

(APPLAUSE)

(LAUGHTER)

UNIDENTIFIED MALE: No!

UNIDENTIFIED MALE: Former national security adviser Michael Flynn plead guilty to charges that he lied to the FBI during their investigation of Trump's ties to Russia or as Fox News reported it, did Hillary Clinton secretly join ISIS?

(LAUGHTER)

I heard Flynn was in trouble I was like, wait, he only lied to the FBI? He didn't also whip it out during a meeting? Solid guy. President Trump knew he had a show tonight so he was kind enough to go on Twitter and do half of our job for us. He said I had to fire General Flynn, because he lied to the Vice President and the FBI. Oh, thanks, man, I got it from here. So you knew Flynn lied and then asked Comey to stop his investigation. That is obstruction. Who is your lawyer? All right. The oatmeal guy. What else does the FBI need? They have a 95 percent conviction rate, a high ranking snitch and a confession on twitter. So this next year, Donald Trump isn't in prison calling some brother's name, lunch meets hair, then damn it, I want the oatmeal guy as my lawyer too.

(APPLAUSE)

(END VIDEO CLIP)

BRIGGS: Not the oatmeal guy but John Dowd said he wrote that tweet. Of course for the president.

ROMANS: Another attorney for the President said he wrote that tweet. It made me wonder, you know, what is the tweeting process going on there in the White House? You know, is the President just firing things off or do people in the staff sending in suggestions?

BRIGGS: Who has access to that account?

It's something we haven't heard from the White House in ten months, in the year since he was elected all the unhinged tweets we have not heard that defense until now.

ROMANS: We haven't heard "I didn't really say that."

BRIGGS: This is a new one.

Another high powered man facing accusations of sexual assault. This morning sexual misconduct, rather. "The New York Times" reporting three men are accusing James Levine, the longtime music director of the New York's Metropolitan Opera, they say he sexually abused them, decades ago.

One of Pompeo's predecessors differed with current CIA director, sitting next to him at the forum, former Director Leon Panetta said quote, when you tweet something like that out there you don't know what the consequences are going to be. And the consequences could be lives.

Levine stepped down as the Mets Music Director 2016 due to health problems. But he was scheduled to lead a new production starting New Year's Eve.

ROMANS: All right. CBS will buy AETNA in a deal that could turn slim healthcare. CBS of course is a huge drug store chain and prescription drug provider, AETNA is one of the nation's largest health insurers. If this $69 billion deal is approved, it will help both companies. CVS gains a huge number of members for the prescription business just as it faces a possible new threat from Amazon. That is right, Amazon in prescriptions. For AETNA, it creates new growth. That is been critical to offset the huge losses under Obamacare. The deal is also a response to soaring health care costs customers

want cheaper access to care. CVS and AETNA say joining force would help on that. That they plan to transform CVS' 10,000 locations into community health centers promising American both lower cost medical care and a place to purchase coverage. That is if the deal is approved, especially after the Justice Department sued to block another so-called vertical merger. AT&T's purchase of Time Warner, the parent company of CNN, both deals concern companies in the same industry that are not direct competitors.

Global stocks higher today, after a crazy day Friday on Wall Street. Michael Flynn's guilty plea slammed stocks and then progress on tax cuts for companies rescued the market. The Dow plunged 350 points Friday after ABC reported that Flynn would testify against President Trump and then stocks rebound after the GOP secure votes to pass their tax bill. The sell offer flex fears that the Russian scandal risk the President's economic agenda especially corporate tax cuts.

Let us be honest. That is what Wall Street wants. Hope for tax reform has launched stocks to record highs. Companies are already making huge profits, lower taxes means they can give even more money to their shareholders in dividends and stock buy backs. Very good for Wall Street what is happening in congress right now. So Wall Street watching for more movement on taxes this week. Also we have a November jobs report on Friday. Bad news for auto sales. 2017 likely mark the first full year decline since the great recession.