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EARLY START

Israeli Leader Speaks to Congress; Clinton's Camp Slams N.Y. Times Report; Supreme Court Takes Up Obamacare; Iraqi Forces Try to Retake Tikrit

Aired March 4, 2015 - 04:00   ET

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


JOHN BERMAN, CNN ANCHOR: The dire warning from Israel's prime minister creating new controversy this morning, warning Congress that Iran will acquire a nuclear weapon if White House negotiations end with a deal. But will Benjamin Netanyahu's unprecedented stance backfire?

We have team coverage in Washington, Iran and Israel ahead.

Good morning, everyone. Welcome to EARLY START. I'm John Berman.

CHRISTINE ROMANS, CNN ANCHOR: And I'm Christine Romans. Nice to see you all this morning. It is Wednesday, March 4th. It is 4:00 a.m. in the East.

Reaction developing this morning across Washington to Israeli leader Benjamin Netanyahu's Capitol Hill speech where he blasted a nuclear deal with Iran, the prime minister holding nothing back in an address to a joint session of Congress that drew repeated -- repeated standing ovations. The speech also drawing full-throttle criticism from the White House and from the president himself.

For more this morning, let's bring in CNN White House correspondent Michelle Kosinski.

(BEGIN VIDEOTAPE)

MICHELLE KOSINSKI, CNN WHITE HOUSE CORRESPONDENT: Hi, John and Christine.

I think it's safe to say that Prime Minister Netanyahu did not disappoint. For many of those who wanted to go there and hear him speak. This was an impassioned speech, drawing thunderous applause from the U.S. Congress, especially those Republicans who invited him there without the White House even knowing about it.

Netanyahu laid out first of all that the U.S. is great, standing with Israel, that Iran is bad, calling it a dark and murderous regime. And then, he ripped to shreds this potential deal that the U.S. and its allies are trying to work out with Iran over its nuclear program by the end of this month.

BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: That deal will not prevent Iran from developing nuclear weapons. It would all but guarantee that Iran gets those weapons, lots of them. That's why this deal is so bad. It doesn't block Iran's path to the bomb. It paves Iran's path to the bomb.

KOSINSKI: The White House tried to downplay this, of course, saying this isn't anything we haven't heard before, that the prime minister presented no viable alternative. Even though President Obama did not watch this speech, he did spend it nearly 15 minutes responding to it.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The alternative that the prime minister offers is no deal, in which case Iran will immediately begin once again pursuing its nuclear program, accelerate its nuclear program, without us having any insight into what they're doing and without constraint.

KOSINSKI: So, now that we've heard Netanyahu, we can see how over the past couple of days, the White House really tried to steal his thunder and preempt virtually everything he said and make an argument against it, saying that if you add more restrictions on to Iran now, more sanctions, or trying to get it to entirely dismantle its nuclear program or set an indefinite time frame on the deal, then Iran just won't take it -- tantamount to no deal at all and in stark contrast to the Israelis, this administration feels that no deal would be way worse than this one.

But keep in mind, Obama did say that at this point, it is more likely than not that Iran rejects this deal -- John and Christine.

(END VIDEOTAPE)

BERMAN: All right. Michelle, our thanks to you.

Now, this morning the key audience for the speech might be 6,000 miles away in Israel. The prime minister is facing an election in just about two weeks. Many there believe the speech was, in effect, part of Netanyahu's campaign.

I want to bring in CNN's Oren Liebermann live in Jerusalem.

Oren, this morning, what's the reaction there?

OREN LIEBERMANN, CNN REPORTER: And, John, there's no doubt that with the elections officially now less than two weeks away, they are the umbrella that hangs over this entire issue. And those on the right have supported his speech from the very beginning, saying this wasn't a political issue, but at the same time, we've heard a tremendous amount of backlash from the left saying it's purely a political issue.

Now, Netanyahu, not once did he mention Likud, which is his party, or labor, the Zionist camp, which is the party he'll be going up against, but this is certainly viewed through a political lens. Netanyahu talked about nothing but Iran and security which are his strongest issues going into the election.

Meanwhile, Israeli politicians who were fairly quiet in the days leading up to the speech came out with criticism the moment the speech ended. We heard from Isaac Herzog, his main rival for prime minister, viewed as his main rival for prime minister, who came out immediately and said that he is here in Israel speaking to Israelis, not in Washington playing politics.

So, that was the crux of his criticism, that while Netanyahu is playing politics and perhaps even endangering the relationship between the U.S. and Israel, Herzog, his main rival is here in Israel, making sure he's speaking to the Israeli people. He was also speaking right outside of Gaza, a community that knows very well what it's like to live under the constant -- excuse me, under constant threat.

So, whether it was viewed politically or not before, it has certainly become very political now with only two weeks left until the elections -- John.

BERMAN: Yes, no separation between the issues of security and politics in Israel to be sure.

Oren Liebermann, great to have you with us this morning. Thanks, Oren.

ROMANS: So the furious controversy in Washington and Israel not appearing to slow down the ongoing nuclear talks between the U.S. and Iran. The Iranian foreign minister, Mohammad Javad Zarif, noting that the Israeli prime minister is, quote, "trying to disrupt a deal", but telling CNN the negotiations are starting to move forward.

Secretary of State John Kerry still in Switzerland for those talks. He heads to Saudi Arabia later this week to reassure King Salman that any agreement will also be in Saudi interests.

Senior international correspondent Frederik Pleitgen following developments for us. He is this morning live in Tehran.

Good morning, Fred.

FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes, good morning, Christine.

And while the prime minister's speech was certainly not directed at an Iranian audience, he certainly did have an audience here in Iran. There were many people who at least knew what he did say in that speech, and, of course, the government watched the speech as well, and they had some pretty stark responses.

And they really went along two lines. On one hand, the Iranian government is saying they're being unfairly criticized. They, of course, maintain that their nuclear program is for solely peaceful purposes. And on the other hand, they are saying that what the only thing Netanyahu is doing is driving a wedge between Israel and its western allies.

Now, the interesting thing was that the moment that the speech started, the Iranians labeled it as Iranophobic, obviously saying that the prime minister was playing on fears of Iran, that they, of course, say are completely unfounded. But then there's also that whole train of thought of driving a wedge between Israel and its Western allies, which is something that the Iranians really were hitting on.

The interesting thing is we did get a quote from the spokesperson for the foreign ministry. They don't usually come out with statements, but this time they did. And they said, "With the continuation of the negotiations and the serious will of Iran to remove this artificial crisis, the politics of Iranophobia are facing major problems."

So, they are saying that it's the prime minister who is artificially blowing all of this out of proportion. But they are also saying -- and I think this is very important -- officially that the negotiations will still continue in spite of the speech -- Christine.

ROMANS: All right. Fred Pleitgen for us this morning in Tehran -- thank you, Fred.

BERMAN: New this morning, Hillary Clinton's camp is firing back at "the New York Times" report about her use of her personal e-mails at the State Department. She apparently only used a personal account or accounts there.

One of her aides tells CNN that nothing shady was going on, that her actions were in keeping with what former secretaries had done. Mrs. Clinton made no mention of this issue during a 30-minute speech Tuesday night.

CNN's Brianna Keilar has the latest, including the Republican reaction -- Brianna.

(BEGIN VIDEOTAPE)

BRIANNA KEILAR, CNN SENIOR POLITICAL CORRESPONDENT: Good morning, John and Christine.

While heading the State Department, Hillary Clinton relied solely on a personal e-mail account. It's not that strange for a secretary to have a personal account, but only a personal account, this is out of the norm.

And while Clinton may not have broken the law by doing this, she certainly broke with the spirit of the law. Clinton released 55,000 pages of her e-mails to the State Department recently, but she has unilateral control over this account, and Republicans are hammering her for it.

REP. TREY GOWDY (R), SOUTH CAROLINA: The State Department does not have all of Secretary Clinton's e-mails on its servers. Only she has a complete record. And the committee is going to have to go to her and her attorneys and her e-mail providers to ensure we have access to everything the American people are entitled to know.

KEILAR: A Clinton aide tells me her use of just a personal account was nothing nefarious. She had a BlackBerry before she became secretary, he tells me, and she kept using it after she entered the Obama administration.

But security experts warn there are huge security risks using just a private account. There's no backup system to keep e-mails if they are deleted. Since Clinton left office, the National Archive Laws have changed. Private accounts are only to be used for official government business in the case of emergencies now -- John and Christine.

(END VIDEOTAPE)

ROMANS: All right. Brianna Keilar, thank you, Brianna.

Now, the fight to fund the Department of Homeland Security is over. House Republicans abandoning their attempt to gut the president's executive actions on immigration, passing a clean funding bill that heads off a partial DHS shutdown. President Obama will sign the measure. There was speculation such a move could cost John Boehner his speakership, but most Republicans are praising him for standing up to the White House.

BERMAN: What a peculiar episode that was.

A pivotal day at the Supreme Court today. The court takes up a new legal challenge to Obamacare. Now, this is the third time that the high court has been asked to rule on the president's signature health care law.

This lawsuit claims that the wording of the Affordable Care Act makes it illegal for the government to offer health insurance tax credit subsidies in more than 30 states. About 7.5 million Americans, even more, could lose their insurance or at least the subsidies which would mean they can't afford the insurance if this challenge is successful.

ROMANS: Just about 10 minutes past the hour. It is time for an early start on your money this morning.

U.S. stock futures down a bit following yesterday's lead. The NASDAQ pulled back from 5,000, it crossed that number on Monday for the first time in 15 years. The Dow and the S&P 500 also pulled back from records.

Target is cutting thousands of jobs. No word on an exact number yet, but most of those layoffs, we're told, will be at the corporate headquarters in Minneapolis where 13,000 people work. The changes will happen over the next two years as part of a major restructuring aimed to save $2 billion. Target is also investing billions to streamline operations, open more small stores, and revamp products to appeal to younger shoppers.

The millennial, Berman, is who everyone wants.

The company is trying to get back on track after losing steam during the recession. And, of course, since that huge breach -- remember that data breach during the 2013 holidays? Really since that huge breach, the company has faced, just one after another, roadblocks to its expansion.

BERMAN: I thought millennials did all online shopping from their parents' basement, like on the laptop that they smuggled downstairs.

ROMANS: Old man, you do not know.

BERMAN: No? All right.

ROMANS: You do not know the ways of the world of the young.

BERMAN: If only there were a book that I could that would tell me everything about millennials. Stay tuned.

All right. Eleven minutes past the hour.

Racism in Ferguson, Missouri -- a troubling new report from the Department of Justice on the city where unarmed black teenager Michael Brown was shot and killed. What investigators are revealing now about the police department. That's next.

(COMMERCIAL BREAK)

ROMANS: This morning, the Justice Department will release a report detailing a widespread pattern of racial bias within the Ferguson, Missouri, police department. Now, the federal investigation was prompted by the shooting of an unarmed teenager, Michael Brown, by a Ferguson police officer last summer.

We get more this morning from CNN's Ed Lavandera.

(BEGIN VIDEOTAPE)

ED LAVANDERA, CNN CORRESPONDENT: Christine and John, the report expected to be released by the Justice Department today confirms what many residents here in Ferguson say that they have known for quite some time -- the accusations that the Ferguson police department has been involved in widespread racial bias for years.

Some of the statistics expected to be released in this report include showing that during a two-year period, even though the city of Ferguson is 67 percent black, it found -- the report found that 93 percent of all arrests involved African-Americans, 90 percent of traffic citations were issued by police officers were given to African-Americans, 85 percent of all vehicle stops involved African- Americans. And at any time a Ferguson police officer used force, 88 percent of those times, it involved African-Americans.

And many leaders here say that what they hope this will do is send a message throughout St. Louis County and other cities like Ferguson here in the area. Many community leaders here say that this is not just confined to Ferguson, that it happens throughout the area. City officials here in Ferguson have not commented publicly on this report yet.

They say they are reviewing it. And on Wednesday, later today, are expected to have some sort of press conference, some sort of comments after they review all of the report -- Christine and John.

(END VIDEOTAPE)

BERMAN: Our thanks to Ed for that. New information this morning about the homeless man who was fatally

shot by Los Angeles police officers. Demonstrators marched from Skid Row to Los Angeles police headquarters Monday to protest the shooting which was all caught on video. Police say the suspect was known as Africa. That was his nickname.

He was shot when he reached for the officer's gun, so say police. Reports say he was a French national, and he was wanted for violating parole on a bank robbery conviction.

ROMANS: The jury is now seated in the trial of accused Boston marathon bomber Dzhokhar Tsarnaev begins this morning in federal court in Boston. Eighteen jurors were selected, 10 women and eight men, six of them alternates. Tsarnaev charged with killing three people, injuring 264 after exploding homemade bombs near the marathon finish line in 2013. Prosecutors will seek the death penalty. That trial expected to run into June.

BERMAN: Testimony resumes later this morning in another high-profile trial in Massachusetts. Former NFL star Aaron Hernandez, of course, accused of murdering his friend Odin Lloyd. A police fingerprint expert will be back on the stand for more cross-examination by the defense.

On Tuesday, he testified that the fingerprints of Hernandez and Lloyd were found inside a rental car allegedly used to drive Odin Lloyd to where he was ultimately killed.

ROMANS: Former CIA Director David Petraeus striking a plea deal that will allow him to avoid prison time. Petraeus pleading guilty to mishandling classified military information, sharing it with his biographer who was also his mistress.

Under the deal, he will get two years probation and a $40,000 fine. Petraeus resigned in disgrace as CIA director in 2012 after admitting the affair. He insists the relationship did not begin until after he retired from the military.

BERMAN: The timing of that was astounding. The announcement happened while Netanyahu was speaking. It was almost as if who was handling the PR for Petraeus wanted it not to get the focus and the spotlight perhaps it might have otherwise.

ROMANS: Prosecutors are requesting two years probation and a $40,000 time. He could go -- technically could get jail time for this. Remarkable to see what a figure he was during the Iraq war. This is the man who had the ear of presidents who is pleading guilty.

BERMAN: All right. In Alabama, that state is openly defying -- or judges there are openly defying an order to allow gay marriage. The state Supreme Court has told probate judges to stop issuing marriage licenses to gay couples. The court says the previous federal ruling that same sex marriage bans violate the state's constitution. It does not preclude Alabama's judges from following state law which defines marriage as between a man and a woman. ROMANS: A serious security flaw caused by an old U.S. government

policy may have left millions of Apple and Android users vulnerable to hackers. Researchers say the so-called freak attack bug affects browsers on Apple and Google devices. The two companies say they've developed updates to fix the flaw. The outdated U.S. government policy requires software makers to use weaker security and encryption programs sold overseas.

BERMAN: A new plan to take back a captured Iraqi city from ISIS, Iraqi forces launching the attack, but leaving the Pentagon largely in the dark. We're going to tell you how U.S. leaders found out about the mission and what it could mean now for U.S./Iraqi relations. That's next.

(COMMERCIAL BREAK)

ROMANS: The Iraqi military launching a major offensive to retake the city of Tikrit from ISIS. Thirty thousand troops storming the birthplace of Saddam Hussein, an operation that we're now hearing caught the U.S. completely by surprise. The Iraqis turning to Iran for help, a sign their alliance with America may be under strain, perhaps.

Let's go to Baghdad and bring in CNN's international correspondent, Ben Wedeman.

Ben, tell us about this assault, this onslaught to try to retake this town, how well it's going and this alliance with Iran.

BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Christine, it's still premature to say they're storming the city. In fact, they are moving very slowly on from north, the south and the northeast. Their progress definitely slowed down by these ISIS IEDs. ISIS, of course, really wrote the book on IEDs during the U.S. presence here in Iraq. So, already the Iraqi army has suffered casualties and fatalities as a result of these mines, booby traps and IEDs.

Regarding Iran, yes, Iran is playing a lead role in this operation. Qassem Suleimani, the lead Iranian al Quds force is there. They are allegedly supervising the operation. We are also hearing there are Iranian advisers on the ground and also Iranians firing heavy artillery and rocket launchers.

According to reports, the Iraqis did not ask for consult the Americans before this operation, and there are no coalition aircraft striking ISIS targets in the area. But this really just is a reminder that Iran has long had a role in Iraq. The Iraqis, of course, very much realize that if it hadn't been for the Iranians several months ago, providing advisers to the Iraqi army, weapons and ammunition, that perhaps the situation would be much worse.

Now, it's interesting that the United States has as many as 3,000 advisers here, compared to those approximately 100 Iranian advisers. But you have to keep in mind that the relationship between the Shia militia who are playing a key role in this operation, many of them have their origins in Iran during the Iran/Iraq war of the 1980s. So, it's a long relationship that predates the American presence in

Iraq. And it's probably one that's going to last long after the United States fades away from this country -- Christine.

ROMANS: All right. Ben Wedeman for us this morning -- thank you, Ben.

BERMAN: About 25 minutes after the hour.

A close call for 238 people on board a Turkish airlines flight from Istanbul to Nepal. Look at that. The Airbus A330 skidded off a runway trying to land in foggy, wet conditions in Kathmandu. The jet crash landed nose down in a grassy field.

There were no deaths, no serious injuries. Just bumps and bruises. Lucky them. Officials suspect poor visibility caused the crash.

ROMANS: All right. Israel warning the U.S. not to negotiate with Iran. But can Prime Minister Benjamin Netanyahu's controversial speech to Congress, can it derail any White House deal? Live team coverage after the break.

(COMMERCIAL BREAK)