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Protest Erupting Across Iran; Two-State Solution Further Away; Germany's New $60 Million Fine; Economic Concerns Fuel Demonstrations. Aired 10-11a ET

Aired January 02, 2018 - 10:00   ET

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

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

[10:00:27] UNIDENTIFIED MALE (TRANSLATOR): The enemy is waiting for an opportunity, for a flaw where they can enter.

LYNDA KINKADE, CONNECT THE WORLD, CNN: This hour, it's not us, it's our enemies. Speaking for the first time, Iran's supreme leader claims six

days of deadly riots have been stirred up by money, politics and guns from outsider, and not from problems at home. Is that right? We'll go live to

Tehran.

Farther away Israeli lawmakers make Jerusalem a tougher point in any possible peace deal. We're live on the ground.

And watch your words. Why what's written on sites like this in Germany could cause companies 60 million bucks.

Hello and Welcome to "Connect the World." I am Lynda Kinkade joining in live from Atlanta. Iran's supreme leader is breaking his silence about

days of protests that have been rocking his country as the death toll continues to mount.

Authorities say 21 people are confirmed dead including six killed during an attack on a police station Monday night. Ayatollah Ali Khamenei blames

Iran enemies for stirring up the biggest antigovernment protest since 2009. This morning Donald Trump has praised the protesters for finally acting

against the brutal and corrupt Iranian regime. One Iranian security official is downplaying the protests spreading across the country

predicting they will end soon. Other officials warn that demonstrators could face a harsh crackdown. Let's bring in now CNN International

Correspondent Nick Paton Walsh. He is been following development tonight from London, nick just give us a sense of who the enemies are that the

supreme leader is blaming for this arrest?

NICK PATON WALSH, CNN CORRESPONDENT: It's clear normally for Ayatollah Ali Khamenei is blaming the United States, called the great Satan. And at the

same time we can lump Saudi Arabia and perhaps the U.K. as well for fermenting this unrest. At this stage, there's nothing to back those

assertions up. Many express sympathy with the major fuel for a lot of these protests by the young men you often see in the videos of protests.

That is economic wages. A quarter of those are without jobs. Today is troubling for many observers of Iran because we have seen the more hard

line elements of its government measured on how the security forces respond to the protests. The death toll had been 21 lives have been lost,

comparatively low to 2009, when we last had unrest like this. They say the enemy is waiting for an opportunity for a flaw through which they can

enter. He refers to how those with more money, politics, weapons and intelligence are behind the violence. All of this are being fueled by

social media. Something else we received in the last hour or so from the deputy chief of staff of Iran's armed forces, he points to flaws inside the

security for allowing the current situation and says an urgent and decisive measure should be taken by relevant agencies to secure domestic cyberspace.

It's unclear how these protests kind of began. The broader problem is Iran's government has a moderate side and hard line side, both I think

struggling to work out how they can deal with the protests that lacks a leader, lacks a figurehead, lacks a clear manifesto and is now in its sixth

day with the death toll, despite most of the dead in Monday night happening in one place, 6 of the 9 new dead there near a police station that was set

ablaze, the death toll has doubled overnight, Lynda.

[10:05:15] KINKADE: We read these tweets by President Trump. Seemingly aligning his support with the protesters. Do they want his support? Does

it undermine their efforts?

PATON WALSH: Donald Trump is a divisive figure worldwide. And his predecessor, Barack Obama, agonize long and hard about whether he should

come out fully in support of the protesters in 2009, because he fears what happen today that hardline is Iran's government would say that those

protesting agents of foreign powers now, there are some use to be in Obama administration here which 09 made more stride and statements on support of

those on the streets. I don't think Donald Trump's statements will massively galvanize those who are already protesting or bring more people

out.

They do certainly add fuel to the argument being made by hard line security officials that the U.S. is fermenting this, but at the end of the day we

can't ignore the fact that the moderate President Rouhani could not ignore himself that there are in his mind indeed grievances, economic hound

political that must be listened to. There is a big difference between protesting and rioting. So the concern grows that we may see more

confrontation possible.

KINKADE: All right. Nick Paton Walsh for us in London, great to have you with us. Thank you very much.

We'll get the latest from the Iranian capital. We're joined on the phone by Eric Randall the deputy bureau chief in AFP in Tehran, he is on the

phone with us now. Eric, just give us a sense of the feeling on the ground there. This is the biggest uprising we've seen since 2009. What have you

seen?

ERIC RANDALL, DEPUTY BUREAU CHIEF IN AFP IN TEHRAN: One of the differences like in 2009 is that this time they're not focus so much on Tehran. We

have seen sporadic protests here in the capital the last few days. It's much smaller scale than out in the provinces. There's a heavy police

presence that makes sure the protesters don't get out in front. What we do now, is that talking to Tehrani's on the street, everybody doesn't like the

protests, but everybody shares the frustration that the young people feel over the state of the economy.

KINKADE: And of course, we have seen thousands of people chanting on the streets, give us a sense of what they're saying, what are they calling for?

RANDALL: It began as economic grievances, as I said, over bread and butter issues, to do with the high price of living, rising fuel costs, food costs.

Basic things like that. But both sides of the political spectrum have fail to do anything about the about the issues, and now it's a protest against

the regime as a whole. Now the protesters are against the whole system. Whether that kind of radical protest can keep its legs in the face of

without turning off too many normal protesters remains to be seen.

KINKADE: Are you seeing many protesters calling for the supreme leader to step down and how rare is it to hear a call like that for his resignation?

RANDALL: It's extremely rare. That is the red line for the regime. That is the line that is not acceptable to cross. I must say that we are

restricted in our movements for what we can cover. They consider these protests to be illegal. That puts some limitations on our movement. So we

have actually been able to see relatively little of what's going on. What we've seen and the impressions we get from our contacts in the city and on

the ground is that there are some people making those radical claims. It should be remembered those relatively small groups in Tehran, a city of 8.5

million people. We're talking about a few hundred at a time. It's relatively under control here in the capital.

KINKADE: Iran's leader Rouhani has said that people are absolutely free to protest, but we're hearing at least 450 people have been detained. Are you

hearing those sort of numbers? What is happening to the people that are being arrested?

RANDALL: We have very little information on that. We know that that is right, that is the number we have, 450 people over the last three days.

It's interesting when you talk to Tehrani's, they pick up on that point, considering it's extremely hypocritical of Rouhani saying everybody has the

right to protest. As one woman said on the street yesterday, how do I have the right to protest when I'm scared just to talk to you in the street?

[10:10:06] KINKADE: All right. Eric Randolph, good to get your perspective from Tehran. We will speak to you again soon, no doubt. Thank

you very much.

RANDALL: Thank you.

KINKADE: Donald Trump's New Year resolution certainly doesn't include less time on social media the U.S. president kicked off 2018 by criticizing

Pakistan's handling of terrorists. He said in part the U.S. has given the country billions of dollars in aid only to get lies and deceit in return.

The U.S. now refuses to release $255 million in military aid to Pakistan. In Karachi, Pakistanis protested holding signs saying dump Trump and any

friend of America is a traitor. Pakistan's government held an emergency security meeting and summoned the U.S. Ambassador to explain Mr. Trump's

tweet. Our CNN producer Sophia Saifi joins us now from Islamabad. I would like to be a fly on the wall to hear how the ambassador explained the

President's tweet. Just give us a sense of the feelings there.

SOPHIA SAIFI, CNN PRODUCER: Lynda, this tweet that came out quite late last night on the 1st of January caught everyone by surprise by the kid of

wording that was used in that tweet. The Pakistani foreign minister saying that Pakistan will release a statement with all the facts -- separating

fact from fiction in their statement. All day today for a couple of hours we had information that the Prime Minister was holding high level meetings

with the National Security Council. There were top military officials present, top civilian ministers present. What's come out of that, we're

still waiting for a statement. Right after that the foreign minister has just sent out a tweet saying that contesting the $33 billion that President

Trump had mentioned that the United States has given to Pakistan in aid and he said in his tweet that, you know, Pakistan is willing to pay for a

private U.S. audit company to kind of calculate exactly where this $33 billion is coming from. And then only will they figure out who is lying

and deceiving. So there's quite a few strong words being exchanged now. We had seen sort of settling in the rhetoric that had been occurring since

August when President Trump had announced his policy. The U.S. Defense Secretary Mattis visited Pakistan. General Nicholson had criticized

Pakistan for harboring the Iran Taliban in the City of Quetta. So there's a fear that this aid will be withheld. And that is what is unfolding here

on the ground in Islamabad, Lynda.

KINKADE: All right, Sophia Saifi. Good to have you with us from Islamabad. Thank you very much.

Another place where Mr. President Trump's words are resonating is in Jerusalem, after recognizing it as the capital of Israel. The U.S.

President says he is still working on his peace plan. But Israel is making the possibility of a two-state solution more difficult. It passed a law

which makes it far more difficult to negotiate any part of Jerusalem. The Holy City is claimed as the capital of Israel and the future Palestinian

state. It is the most sensitive and most important issue in the Israeli/Palestinian conflict. Oren Lieberman joins us from Jerusalem.

Oren, the Palestinian leader's spokesperson said this is virtually declaration of war against the Palestinians. Does this move undermine any

chance of reviving the peace talks?

OREN LIEBERMANN, CNN CORESPONDENT: Those talks were a long shot to begin with. Over the past month it seems they've become a longer shot, a more

remote idea. Yet one that President Trump insists he is pursuing. After Trump recognized Jerusalem as the capital of Israel in early December, the

Palestinians said we're not engaging with the U.S. on whatever their peace plan is, because we no longer see the U.S. as an honest broker of peace.

Now the Palestinians have said this shows that the U.S. and Israel are no longer interest or not interested in just and lasting peace. So what does

this do? It should be pointed out that the Palestinians in addition to not engaging on the peace plan now the U.S. needs to deal with the Israelis who

are moving away from negotiating Jerusalem, which makes it more difficult to pursue a two-state solution what does this new law do?

It requires a super majority of 80 out of 120 seats in the Knesset to seat any part of Jerusalem to a foreign entity. That would be the Palestinians.

That part becomes harder. It also allows the Israeli government to redraw the borders of Jerusalem with a little more political railing. That means

Israel can remove Palestinian neighborhoods from Jerusalem to ensure the city has a greater Jewish majority. We went to one of those neighborhoods

to get a better sense of that.

(BEGIN VIDEO)

[10:15:21] LIEBERMANN: If there was ever hope in this refugee camp, it was long ago replaced by garbage. Bags pile up on the streets, fill empty

yards, more real than any peace process.

When was the last time you saw a garbage truck here?

UNIDENTIFIED MALE (TRANSLATOR): There is no cleaning services given to the refugee camp at all.

LIEBERMANN: I go through the camp's narrow alleys, home to 70,000 Palestinians who cram in the jungle and crowded streets, many refugees from

the wars of 1948 and '67. This is a children's center in the camp to keep kids off the streets. Crime, drugs, major problems here. There is a

national healthcare center here, but few local services. Jerusalem's holy sites seem a world away.

What is it like living here in this refugee camp?

UNIDENTIFIED MALE (TRANSLATOR): It means you're living in a big prison.

LIEBERMANN: The greater Jerusalem plan being developed by the Israeli government would see this neighborhood removed from the city into a new

municipality made up of over densely packed Palestinian neighborhoods. The population would be cut by more than a third.

UNIDENTIFIED MALE: The goal is one that is shared by the overwhelming majority of Jewish Israelis, that Jerusalem remain our capital and a Jewish

majority city.

LIEBERMANN: A wall separates the refugee camp from the rest of the city. Nearby where Israelis live looks pristine in comparison. The neighborhoods

separated by so much more than a valley. As we leave the refugee camp, we're going from Jerusalem into Jerusalem, yet we still have to cross

through this checkpoint within the city.

This a camp of isolation in a city hailed by leaders as united.

(END VIDEO)

LIEBERMANN: Now we'll wait to see what happens with Jerusalem and its status in whatever Trump's peace plan is, whatever his plan for negotiation

is, in terms of changing the city it allows Israel the option to do so, but we have to wait to see how soon the Israeli government acts on this as is

so often the case with Jerusalem and the middle east, the next few months are very difficult to predict here.

KINKADE: No doubt. You will be watching it closely for us Oren Liebermann. Thank you very much.

Still to come, Iran's youth were promised a lot after the nuclear deal was signed two years ago. How much has the Iranian President been able to

deliver? We'll have more on the economic discontent that is fueling the protests in Iran next. Plus a rare olive branch from North Korea's leader.

Kim Jong-un declares his hope for peace on the Korean peninsula.

(COMMERCIAL BREAK)

[10:20:57] KINKADE: Welcome back we return to our biggest story, the biggest antigovernment protests in Iran in almost a decade. The rallies in

more than a dozen towns and cities across the country turned the spotlight on President Rouhani's economic record. Despite the easing of

international sanctions as part of the nuclear deal, people in many parts of the Islamic republic have not seen much improvement in their daily

lives. CNN Amir Daftari has the story.

(BEGIN VIDEO)

AMIR DAFTARI, CNN CORRESPONDENT: Unemployment, inflation, corruption. The triggers for deadly protests across Iran. The government has acknowledged

the economic challenges.

UNIDENTIFIED MALE (TRANSLATOR): What's clear is these threats and challenges have to be turned into opportunities.

DAFTARI: But words have not been enough. In fact the protests have spread. With frustrations over the economy growing into wider discontent

about the overall state of politics. Many Iranians had higher expectations for their country. This was the scene just two years ago. Young men and

women cheering Iran's nuclear deal with world powers. Hopeful that and to years of economic sanctions would bring a more prosperous future. There

have been some improvements. Growth has returned and inflation has fallen. The international monetary fund says the economy is set to expand by 4.2

percent. Iran's crude oil is being sold overseas once again. And foreign investment is starting to trickle back as well. France's oil giant, total

and China's CNPC agreed to invest billions of dollars to develop a giant gas field.

But many Iranians are not feeling the benefit. Daily life remains hard and there's not enough jobs, especially for the young. The unemployment rate

for those age 15 to 29 is around 25 percent. At the same time the government's new budget is set to cut infrastructure spending and cash

subsidies while allocating millions of dollars for religion institutions. While Iran's economic indicators are positive, the government needs to find

a way to translate them into higher living standards and fast. Amir Daftari, CNN.

(END VIDEO)

KINKADE: Well, of course adding to the economic woes of the country, military operation in war-torn Syria. For more on the protests, grievances

and government response I want to bring in Ellie Geranmayeh, she is the policy fellow from the European council on foreign relations and joins me

now from London. Great to have you with us, Ellie.

ELLIE GERANMAYEH, THE EUROPEAN COUNCIL ON FOREIGN RELATIONS: Thank you for inviting me.

KINKADE: At the end of the day, how much of the unrest in the problems we're seeing is about money. The fact that many people can't buy basic

supplies like eggs, milk, and that unemployment is rising. Did people there expect to have a windfall when the nuclear deal was signed?

GERANMAYEH: Certainly when the protest started last week they were sparked by slogans to do with economic frustrations of those chanting on the

streets. They evolved into something more to do with social, political grievances as well. The initial trigger were the economic woes. And, yes,

there was high expectations inside the country, which is largely youth demographic that after the sanctions easing brought about by the nuclear

deal there would be greater trickledown effect. That related into the way the Rouhani government envisioned and the other world powers who signed the

deal. Because coming out from sanctions, almost ten years of sanctions, has also unprecedented consequences in terms of how easy it's been for

international investors to go back into Iran and for domestic policies inside the country to reform.

[10:25:06] KINKADE: Looking at the political fallout. We're seeing factions in both Iran and the U.S. using these protests to score political

points. Many in Washington asking President Trump to get tough on Iran by using the nuclear deal, let's listen to what Republican Lindsey Graham had

to say.

(BEGIN VIDEO CLIP)

SEN LINDSEY GRAHAM, (R) SOUTH CAROLINA: It's not enough to watch. President Trump is tweeting very sympathetically to the Iranian people.

But you just can't tweet here. You have to lay out a plan. If I were President Trump, I would lay out a plan as to how I would engage the

regime.

(END VIDEO CLIP)

KINKADE: Senator Graham there says President Trump should push for a better nuclear deal rather than shy away from wading into this crisis. How

likely is it that he would do something more than just something that just involves a tweet?

GERANMAYEH: It's been incredible to watch how many political pundits in Washington, D.C. have become Iran experts over the weekend base in this

protest. Certainly these protests in Iran come at a sensitive time for the nuclear deal where in the coming days we're expecting a decision to be made

by the U.S. Administration on whether they certify Iranian compliance to congress and also waive international sanctions. The prevailing consensus

was that the Trump administration wouldn't undertake action to undermine the deal, and offer a death blow, but that is always the mandate. There is

a lot of pressure particularly by those in the establishment, the U.S. that have advocated for regime change in Iran. For him to pullout of the deal

or negotiate some sort of unicorn better deal. That pressure, it will likely build up as a consequence of these protests inside Iran.

KINKADE: A recent policy briefing, you wrote that Europe should not only try to preserve the nuclear deal with Iran, it should also make contingency

plans to salvage the relationship with Iran if the U.S. defects. Just briefly, is it even possible for Europe to unilaterally preserve the deal

if the U.S. is determine to ditch it?

GERANMAYEH: As the report caveats, this would be an extremely difficult task, but it would be essentially be a political task for governments in

Europe, particularly those who are parties to this nuclear deal to make a political choice of whether they want to abide by commitments that they

signed by or follow quite unreasonable behavior from the U.S. side to renegotiate from it. Essentially there are tactics that Europeans have

used to politically and legally push back against U.S. measures that undermine European foreign policy. In our report we looked at some of

those options.

KINKADE: All right, Ellie Geranmayeh. We'll have to leave it there for now. Good to have your perspective on all of this. Thank you very much

for your time today.

For the full story on what President Obama did and didn't do, which we did not get a chance to chat about just then, we want to point, you to our

website, which looks at how the Obama administration responded to Iran during protests back in 2009 and how the President currently is reacting.

You can check out the article on CNN.com for a good look at the thinking past and present.

Still ahead, back from a holiday to a busy calendar, policy in Iran and Pakistan are just two of the many issues that President Trump will have to

deal with this year. Looking ahead to that next.

[10:30:00] (COMMERCIAL BREAK)

LYNDA KINKADE, CNN ANCHOR: Hello, welcome back to Connect the World. I'm Lynda Kinkade, thanks for joining us. The 2017 was Donald Trump's first

year as the U.S. president. And it's fair to say he made sure it was eventful.

As we reported at the beginning of the program, we are just two days in and 2018 is reshaping up to be a busy year for Mr. Trump. Joe Johns looks

ahead.

(BEGIN VIDEOTAPE)

JOE JOHNS, CNN CORRESPONDENT: President Trump returning to Washington with a large legislative to-do list and a range of international issues on his

plate.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Everybody is going to love what's happening with our country because we're taking this big beautiful

ship, and we're slowly turning it around, like it a little faster.

JOHNS: Mr. Trump weighing in multiple times over the holiday on the deadly anti-government protest in Iran, saying that Iran is failing at every level

and calling for change after warning the U.S. is watching very closely for human rights violations.

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: It's not enough to watch. President Trump is tweeting very sympathetically to the Iranian people, but

you just can't tweet here. You have to lay out a plan.

JOHNS: Iran's ambassador to the U.K. calling the tweets offensive in an Instagram posting Monday night, as for Kim Jong-un's New Year's threat that

the nuclear button is always on his desk, President Trump saying only this.

TRUMP: We'll see. We'll see.

JOHNS: The former chairman of the Joint Chiefs of Staff warning that the U.S. is closer to a nuclear war with North Korea than ever before.

MIKE MULLEN, FORMER CHAIRMAN OF THE JOINT CHIEFS OF STAFF: I don't see the opportunities to solve this diplomatically at this particular point.

JOHNS: The Trump administration's relationship with Pakistan also strained heading into the New Year. Mr. Trump accusing Pakistan of lying and

deceiving the United States in his first tweet of the year, and again alleging that the country's the leaders have given safe haven to

terrorists.

TRUMP: We have been paying Pakistan billions and billions of dollars, at the same time they are housing the very terrorists that we are fighting.

JOHNS: A National Security Council spokesman later saying the U.S. will continue to withhold $255 million worth of military aid from the country.

Pakistan responding by summoning the U.S. ambassador for a meeting and promising to respond shortly to let the world know the truth. All this as

the administration confronts a number of legislation deadlines back here in the U.S.

The first, a January 19th deadline to pass a spending bill and avert a government shutdown that could cost billions, one issue that will be front

and center, protection for so-called DREAMers who were brought to the country illegally as children.

[10:35:00] The president insisting there will not be a deal on DACA without funding for the wall, a nonstarter for Democrats.

UNIDENTIFIED FEMALE: Will you give anything to the president on border wall funding in order to get a DACA deal done, because he says...

REP. DEBBIE DINGELL (D), MICHIGAN: No.

(END VIDEOTAPE)

KINKADE: Well, Plenty to discuss with our next guest, David Sanger who joins us via Skype. He's a CNN political national security analyst, he is

also a national correspondent for the New York Times. Great to have you with us, David.

DAVID SANGER, POLITICAL NATIONAL SECURITY ANALYST: Great to be back with you.

KINKADE: Well, after a ten-day holiday, President Trump is back to work and back to Twitter. And despite his America first agenda, he has been

very busy in the first two days of 2018 tweeting about international affairs.

SANGER: Well, when you think about it, many of his tweets in 2017 were on international issues, including some of the ones that the administration

found the hardest ones to integrate in with their national security strategy.

But you know this -- what we've seen him say in the past two days hasn't been wildly off line. The Pakistan elements that you just referred to in,

Joe's, setup there, is an argument tat's been going on between Washington and Pakistan for many years.

The Obama administration temporarily withheld some of the payments which are payments for counterterrorism operations. You know, in New York, in

the fall, the Pakistani president was in town.

He sort of filled in after President Sharif (ph), and what's been interesting about all of this is that he basically denied that there was

any terrorism problem left in Pakistan. Well, clearly that's not the case.

So it's going to be an interesting standoff. And if the tweet has caused the Pakistanis to go take another look with the Pakistani military at what

kind of problems they face, that one may not be entirely bad. Iran is more complicated.

The president has got to walk a very fine line between supporting the protesters, which President Obama later regretted he had not done more

forcefully in 2009, and not letting the government make the argument that the U.S. is instigating any of this. And that's a very tricky thing.

KINKADE: Let's just look at North Korea for a moment, David. As North Korea reaches out to the south to seemingly start dialogue, they have also

made a threat again at the U.S. saying that the U.S. is within range of our missiles. Could this dialogue between the north and the south put the U.S.

in a more precarious position?

SANGER: Well, it certainly has the possibility of putting a wedge between the South Koreans and the U.S. allies of some seven decades. And the

reason for that, is that the North Koreans have rather noticed that President Moon in South Korea, just came in, in the middle of last year

after his predecessor was forced to resign.

President Moon has basically argued for negotiations without much preconditions with the North Koreans, has called for cessation for a while,

at least during the Olympics of the military exercises with the United States, and has said that he has a veto over any American military action

against the north.

Something that people in the administration tell me is not the case. So I think that Kim Jong-un has looked at this and said, there's a moment here

to open up some space between the South Koreans and the U.S., and he's picking a very opportune moment to go do it.

Because he knows it would be extremely difficult for President Obama -- I'm sorry, for President Trump to order any kind of military action for the

same reason President Obama considered it and dispensed with it, which was the huge impact it would have if the North Koreans retaliate against Seoul.

KINKADE: And, David, just quickly, the Russia investigation is expected to wrap up this year, already four Trump associates have been charged. Can we

expect more to fall or is it likely that the president could pardon his aides or family members who may be implicated?

SANGER: Well, you know, I wouldn't make many projections or predictions for 2018. But one I would is that a year from now, if we're doing a

similar broadcast, I'm betting the Mueller investigation is still ongoing.

I don't see any evidence that it's wrapping up any time soon. The president's lawyers told him it would be wrapped up between thanksgiving

and Christmas.

[10:40:00] But I'm not sure they said what year. So that's going to be going on for some time. And my suspicion is that there would probably be

some other indictments.

But the real significance of the indictments so far and the plea deals have been the question of how much those who have been indicted particularly,

Michael Flynn, the former national security advisor and a young foreign policy aid, how much they know and how much they're cooperating with the

current investigation.

Then there's a senate and a house investigation. The House investigation isn't going well. But the Senate investigation seems to be pretty serious.

And when I recently saw Richard Burr, the chairman of the Senate Investigatory Committee, and in the Intelligence Committee, he thought this

is going to go on for longer than he had anticipated.

KINKADE: All right. David Sanger, we could still be talking about the Russian investigation into 2019.

SANGER: Easily. Easily. I'm not making predictions yet for 2020, but check with me for next year.

KINKADE: We'll do. David Sanger, good to have you on. Thank you.

SANGER: Great, take care.

KINKADE: Just before we move on, we've heard Mr. Trump take credit for the economy and the booming stock market many times. But today, he also

suggested that his policies are behind a lack of commercial airplane crashes.

He sent out a tweet saying since taking office, I have been strict on commercial aviation. Good news, it was just reported there were zero

deaths in 2017, the best and safest year on record.

Well, with, David, there we were just talking about the political ups and downs of a different sort of high. Well, in California they brought out

the legal sale of recreational marijuana. As Miguel Marquez tells us, there's big money involved.

(BEGIN VIDEOTAPE)

MIGUEL MARQUEZ, CNN CORRESPONDENT: The brave new world of legal recreational marijuana in California is underway. What changes here from

Colorado and Washington State, is the size of the industry.

Altogether, the legal industry across the country is about a billion dollars now. It will be in the $7 billion range by the time California's

done. And the black market here in California, if you add that in, it's about $20 billion to $30 billion, so, just an enormous market.

We're in San Jose because it's only a handful of recreational sellers open today and we're at this particular place, Buddy's Cannabis, for one reason.

This guy has the very first license for medicinal and adult-use marijuana, license: 0000001.

And it's made at the behest of the Bureau of Cannabis Control, that's an actual state department with the California government. It is a brand-new

day. So how much can you actually buy? It depends on whether you are buying recreationally, or whether you are buying medicinally. Pardon me,

so excuse me.

If you're buying recreationally, you can buy up to an ounce. Each of those is a half-ounce each. Each of those buds in there are for this particular

brand, which is homemade cherry pie.

That would probably cost you around $35, just for that little one, Marijuana running anywhere from 130 bucks for a half-ounce to up to 250,

260 for the better stuff.

If you're buying medicinally, you can buy this much. This is a half-pound of marijuana in these containers. It's a much greater amount you can buy.

Taxes are also different here.

The marijuana in the state will be taxed up to 45 percent. If you're buying recreationally, you get a break. If you are buying medicinally, you

have your medical card. I want to speak to Matt Lucero, who is the owner of Buddy's Cannabis.

MATT LUCERO, OWNER, BUDDY'S CANNABIS: Yes, sir.

MARQUEZ: How busy is it today?

LUCERO: It is probably our busiest day in our seven-year history.

MARQUEZ: You already see that?

LUCERO: Yes, absolutely. I'm looking around. We have folks outside. Every chair in the building is filled right now.

MARQUEZ: You've been planning for this for some time. You were a corporate lawyer that went into the marijuana business. You've been

planning for this like you would at a corporate, how much more marijuana did you bring in to the system? How much are you expecting business to

improve?

LUCERO: We're expecting business, I would say conservatively, about a 30 percent bump in sales just overnight. It looks -- looking around this

room, more like 50 percent to 60 percent.

And as far as the amount of cannabis, we had been selling about 300 pounds per month. We just accumulated about another quarter-million-dollars-worth

in anticipation of this huge rush. So, we've got -- so, we've got plenty of product.

MARQUEZ: The bottom line is that legal marijuana is going to change the landscape here. In certain towns you can do everything from -- you'll be

able to go to restaurants and to different businesses where you can consume on site, other towns aren't allowing it all, some towns are saying, you can

only deliver. The wild west of California is finally coming into the legal world.

(END VIDEOTAPE)

KINKADE: The Wild West.

[10:45:00] Well, in case you happen to be wondering after that, California is now the eighth state along with the District of Columbia to legalize

recreational marijuana use.

Eighteen other states allow the use of pot for medicinal purposes only. It's important to note though that cannabis is still illegal under federal

law in the states.

You are watching Connect the World. Coming up, new signs of hope that North Korean athletes will compete in the Winter Olympics in South Korea,

we have that story when we come back.

(COMMERCIAL BREAK)

KINKADE: A rocky relationship between North and South Korea may already been showing signs of improvement in the New Year after a surprisingly warm

New Year's message from North Korean leader Kim Jong-un.

Mr. Kim said he hopes for a peaceful resolution on the southern border and said North Korea should start negotiating with the South about the upcoming

Winter Olympics as soon as possible.

That's certainly an encouraging sign for North Korean athletes who want to compete in the games. Paula Hancocks reports now from Seoul.

PAULA HANCOCKS, CNN CORRESPONDENT: Well, Lynda, we've seen a flurry of statements here in South Korea, many different departments, many different

ministries saying that they welcome that conciliatory speech from the North Korean leader, Kim Jong-un on New Year's day, saying they did want to talk

to the South Koreans.

Kim Jong-un saying he's willing to send a delegation to the Pyeongchang Winter Olympics next month. And certainly that has been very welcomed news

from the South Korean side.

We had a statement from President Moon Jae-in, he said that it's important to talk and potentially, they can move it beyond the Olympics and start

looking at the nuclear program in North Korea.

We also had a positive response from China saying that it is a good thing that the north and south are potentially going to talk. China has

consistently said that they want to see negotiations that are actually set between Pyongyang and Washington.

But what we're seeing there is Kim Jong-un is really trying to move away, almost sideline the United States when it comes to negotiations. Relations

between the two countries were dire last year.

The relations between the two leaders were very personal and dire last year. So it seems as though North Korea is now focusing on South Korea.

So what we have at this point is the South Koreans suggesting January 9th.

So that's next Tuesday for high-level talks at the Panmunjom village which is in North and South Korea, along the DMZ. We haven't heard from North

Korea as to what their response will be.

But the South Koreans have said that if they disagree to that, then they will do another time or another venue, and another content or format.

Lynda.

KINKADE: Thanks, Paula Hancocks, for that report. Well, coming up, German residents need to be careful on what they post on social media.

[10:50:00] Fake news and illegal posts could now get websites in trouble and cost them a lot of money. That story next.

(COMMERCIAL BREAK)

KINKADE: Well, Germany has kicked off 2018 with new laws to police the internet. Facebook, Twitter and other social media companies can now be

fined up to $60 million if they don't remove content deemed to be hate speech, illegal content or fake news.

The sites must act on reports within 24 hours. For more, Chris Burns, joins me now from Berlin. Chris, one far-right politician there in Germany

could be the first to be hit over these new hate laws.

CHRIS BURNS, JOURNALIST: Yes, that's right, Lynda. Beatrix von Storch, in fact, she is one of the leaders of the alternative for Germany, AfD, which

got more than 10 percent of the vote in the last election in last fall.

She is also a grand daughter of a finance minister under Adolf Hitler. She came has under intense criticism because of a tweet she made, an anti-

Muslim tweet she made around new years.

And that caused -- under this law, that caused Facebook and Twitter to shut down her account for at least 12 hours, and to pull the tweet and the

posting off. She came back when her -- when her account was back up again.

She was on the attack, calling this censorship. She says this is the end of constitutional law in Germany. And in fact, another leader in the

party, Alice Weidel -- she also retweeted what, von Storch, had been tweeted and Facebooked. So she might also come under some -- perhaps some

censor from the European Parliament -- sorry, from the German bundestag. Lynda,

KINKADE: All right, Chris, unfortunately, we have to leave it there for now. But stay close those new laws for us in Germany, thank you very much.

Well, now it's time for your Parting Shots, where a little good news and a little bad news, astronomically speaking at least. The first super moon of

this year, January 1st, was also the best one we'll ever get.

So it's only downhill from here, I'm afraid folks. NASA says the so-called wolf moon as our natural satellite, swung in to the very closest point will

be the very biggest and brightest of the next 12 months.

Well, that's about all of it here from us at Connect the World. We are live and buzzing earth core in conneting every minute of the day on our

Facebook page. Where is that you ask? Well it's Facebook.com/cnnconnect and of course, I'm on Twitter, too.

[10:55:00] You can tweet me at Lynda Kinkade. I'm Lynda Kinkade, that was Connect the World. Thank you so much for watching. In our first show of

the year, we leave you with picture of how Amsterdam greeted it and we're going to have Robyn Curnow the International Desk in just a moment.

END