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Stock's Plunge as China Retaliates from New U.S. Tariffs; Two Oil Tankers Attacked Off Coast of UAE; Iran In Sharp Focus, Regionally and Globally; American Couple Say Kenyan Police Took 3-Year-Old Boy; Constitutional Showdown Escalates Between Trump and Congress; Analyst Says Trump Should Take History Lesson on Iran's Pride; Analyst, Iranian Regime Orchestrating Conflict with U.S.; Manchester City Wins Premier League Title. Aired 11a-12p ET
Aired May 13, 2019 - 11:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[11:00:00] BECKY ANDERSON, CNN HOST: Tonight, sabotage in the Gulf, or so it seems. Precise targeted and a total puzzle. Right now, four ships of
American allies directly attacked in the Gulf. So who is responsible? And why and why now? We will connect it all for you this hour.
Also ahead --
(BEGIN VIDEO CLIP)
DAISY MAZZONCINI, KIANO'S LEGAL GUARDIAN: They were going to take him. There was nothing we could do. At this point, there was 13 people, you
know. And like Matt said, they had literally made a human wall.
(END VIDEO CLIP)
ANDERSON: The police came in plainclothes, took their 3-year-old son. They haven't seen him since. The full story is just ahead.
Then the pictures say it all. Party on. Manchester City celebrate their Premiere League win.
We're connecting your world through Abu Dhabi this evening. It is just past 7:00 p.m. here. Welcome to CONNECT THE WORLD with me, Becky
Anderson. Those stories ahead.
I just want to get you some breaking news on Wall Street. The Dow, well it's plunging deep into the red as a trade war escalates between the
world's two biggest economies. China now hitting back against new U.S. tariffs with a tariff hike of its own. Going to get you the details in
live reports from Beijing and the New York Stock Exchange a little later this hour. Suffice to say, you see a significant fall there on the Dow.
More than 550 odd points down. That is more than 2 percent.
Well attacks at sea. Blame in the air and diplomacy on shaky ground. We begin with regional tensions of global proportions and at the center, Iran.
The country and critically the fate of its nuclear deal is driving the agenda of America's top diplomat and European officials in Brussels. Mike
Pompeo even nixed a planned trip to Moscow to go there. This after two Saudi Arabian oil tankers were damaged off the coast of the UAE. The
attacks Riyadh calls sabotage.
We must stress there is no claim of responsibility. But it comes just days after the U.S. warned that, quote, Iran or its proxies could hone in on
commercial vessels in this region. Four tankers were targeted overall, according to the UAE. You are looking at some of the damage to a Norwegian
tanker.
We're covering all sides of what is an extremely complex story. A story that starts here in the region but has global residents. Live from Tehran
we've got Fred Pleitgen for you here. In Abu Dhabi is John Defterios. Matthew Chance is in Moscow. While Nic Robertson has been reporting on
those tanker attacks off the coast of the UAE in the Gulf of Oman. We begin with Nic who has more on exactly how these so-called sabotage
unfolded and why the incidents come at such a critical time.
(BEGIN VIDEOTAPE)
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Becky, what we're learning is that these four vessels, these commercial vessels that were
sabotaged. One is this one the Al Marzooah, a Saudi registered vessel, appeared to have had these sabotage incidents in the early hours of Sunday
morning. We know -- we now know that there were the four vessels. Two of them were registered to Saudi Arabia, one registered to the Emirates and
one registered to Norway.
What appears to have happened, what we're understanding and learning is that a call was made in the early hours of Sunday morning saying that water
was perhaps getting into the engine room. That something out of the ordinary was happening. And over the space of the next couple of hours, it
appeared that four vessels out here in the Straits of Hormuz off the port of Fujairah, were experiencing some sort of irregularities.
The Emirati authorities began investigating. And that's when they realized there were these incidents of sabotage. Now it's not quite clear yet what
caused this sabotage, how it was perpetrated or even for that matter who perpetrated it. Emirati authorities clearly investigating. But what we
know is that these four vessels out here -- and you can see across the horizon here. There are about 100 or so vessels parked up here. These
four different vessels that were impacted by the sabotage were not in the same place. They were scattered throughout the area. And of course, this
comes at a time when there's rising tensions between the United States and Iran.
[11:05:00] The Abraham Lincoln that carrier battle group is on the way in into the area. Patriot missile battery is on the way into the area as well
as B-52 bombers. The coast of Iran not far from here. So while the Emirati authorities continue to investigate, and we're awaiting the outcome
of the investigation -- not quite clear yet when it will come. But while we wait for the outcome of that investigation, of course, these sabotage
incidents risk raising tensions of what is already, Becky, a very tense time.
(END VIDEOTAPE)
ANDERSON: Right. That's Nic for you. Let's get to our correspondents on the ground reporting on this sort of -- the connections on this. Nic, Fred
reporting on these incidents of sabotage. What isn't clear, as he rightly pointed out, is who is responsible. This though at a time when the U.S. is
deploying forces, including an aircraft carrier and B-52 bombers to the Persian Gulf to counter what they call Iranian threats. As well as warning
Iran or its proxies could target vessels in the region. What's been the response from Tehran?
FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, the Iranians, Becky, they've come out and they've also condemned what they call
the sabotage as well. It was interesting, because in the press statement that they put out, they also said that they believe that it might be some
other outside force who might be responsible for this to try and put fire into an already tense situation there in the Persian Gulf. Obviously, the
Iranians insinuating that maybe this was some sort of false flag attack.
You are absolutely right, the tensions of course have been flaring up, especially between the Iranians and the United States. The Iranians in
general saying they believe that it's the U.S. that's responsible for escalating the situation here in the Persian Gulf area. They accuse the
U.S. of conducting what they call economic and psychological warfare against Iran. But they also say that Iran is not going to back down. Here
is what we learned today.
(BEGIN VIDEOTAPE)
PLEITGEN (voice-over): An Iranian naval show of force in the Persian Gulf, just as the U.S. deployed an aircraft carrier to the region. A senior
Iranian Revolutionary Guard commander going on state TV saying American military assets are in their crosshairs.
Imagine this is their aircraft carrier, he said. At least 40 or 50 aircraft are on board and 6,000 personnel. Right now, they are a target
for us.
The U.S. says it urgently deployed the USS Abraham Lincoln to the Persian Gulf and sent both B-52 bombers and additional patriot anti-aircraft
batteries to the Middle East. After the U.S. said it detected Iranian military movement that could indicate a threat to U.S. bases in the region.
Before leaving for Brussels, Secretary of State Pompeo with a warning for the Iranians.
MIKE POMPEO, U.S. SECRETARY OF STATE: An attack on American interest from an Iranian-led force, whether it's an Iranian proper or is an entity that
is controlled by the Iranian's, we will hold the responsible party accountable.
PLEITGEN: Iran accuses of Trump administration of escalating the situation. Tehran accusing Washington of trying to bring Iran to its knees
through economic and psychological warfare.
Iranian parliamentarians telling CNN talks with the Trump administration are out of the question for now.
SEYED HOSSEIN NAGHAVI HOSSEINI, IRANIAN MP (through translator): Americans are not worth having a dialogue with, this parliamentarian says. They
can't be trusted for talks. They're not worthy of dialogue and they lie about their intentions for meeting and talking with us. If they want a
dialogue, they wouldn't have threatened us militarily.
PLEITGEN: With tough talk on both sides, many Iranians already suffering under tough U.S. sanctions are concerned the situation could escalate into
an armed conflict with devastating consequences.
(END VIDEOTAPE)
PLEITGEN: As you can see there, Becky, it doesn't really seem as though a diplomatic thaw between the United States and the Iranians is in the cards
anytime soon. As we've noted, the Iranians at this point in time saying they don't believe it's worth their while to talk to the Trump
administration. While at the same time the Iranian military keep saying again and again and again that it doesn't want conflict with the United
States. But if there is a conflict, they believe that they are ready to take on the U.S., at least here in this region in the Middle East -- Becky.
ANDERSON: Standby, Fred. I want to get to John who is here with me in Abu Dhabi. You have been speaking to your sources in Saudi Arabia. We know
that two of these vessels that were, quote, sabotaged off the Emirati coast were Saudi vessels. What's been the response in Riyadh?
JOHN DEFTERIOS, CNNMONEY EMERGING MARKETS EDITOR: Well, first and foremost, I thought they were very transparent with the information. In
fact, this market was pretty subdued until we heard from a high-level minister of energy, Khalid al-Falih, put out a statement saying there was
structural damage to the particular vessels that are out there.
Two of them are Saudi, we know as Nic's report was suggesting. One is a UAE flag and one Norwegian.
[11:10:00] But when that Saudi statement came up, they're like, oh, my, the number one exporter in the world that uses the Strait of Hormuz could be
vulnerable as well. I think it's worth pointing out here, Becky, though that this was not within the strait. It was around 130 kilometers south of
the strait. And not within the port of Fujairah, but in the UAE, near the territorial waters here.
That tells us that it's not the strait that's only in play here right now, but it's the broader region going into the Gulf of Oman, which should raise
some eyebrows. I think the message here, whoever did this sabotage or the attacks that we see today, the message I think is, you've got to be careful
what you ask for. You asked the U.S. to increase the pressure on Iran. It doesn't mean that Saudi Arabia and the UAE is not vulnerable. And I think
that's what the port of Fujairah and the tankers that did suffer the attacks tells us tonight.
ANDERSON: You bring up the Strait of Hormuz, which is incredibly important to flag once again to our viewers. Let's remind ourselves why the Strait
of Hormuz -- just as you point out, north of where the sabotage incident occurred -- is so important. Let's have a look at the maritime traffic
folks going through the strait right now. Dozens of vessels appear to be converging on it. In fact, about one-fifth of all the oil used in the
world goes right through that passage. If you want to choke off the flow of oil, John, disrupt the market, this is where you start. Isn't it?
DEFTERIOS: It is. And of those tankers that are passing through there on the graphic, 15 to 20 of them are the super tankers that feed the world
each day. So about a fifth of the global supplies, is a third of seaborne traffic. So if you want to wreak havoc in the oil market that's your place
to target.
A senior Saudi source said something interesting today. They are expecting a fall in oil prices because of the U.S./China trade dispute. So this is
the silver lining to the dispute. We probably could have saw a gain of 5 percent when you see tankers under attack. That gain so far has been about
2 percent. We're up to $72 a Barrel. Recently, we hit $75 when Donald Trump said he was going to take the exports of Iran down to zero. But the
autumn high was $86 a barrel. We're not in that range yet, Becky. There's no reason to panic. There's plenty of oil on the market. Saudi seems
ready to response if necessary. And they're waiting for the OPEC figures tomorrow to start giving some clearer indications.
ANDERSON: The Saudis and UAE have been clear about their position with regard to this regime in Tehran. They say it's not the Iranian people but
the Iranian regime, which they have a significant issue with. What -- with its expansionist tendencies around the region. They have been perhaps
surprisingly officially quiet about the optic and rhetoric we have seen from the U.S. with regard to Iran in the past week. But any incident like
this which threatens their territorial waters, vessels out of a port or close by a port is obviously incredibly important to them.
That's Saudi. We have talked UAE.
Let me get to Matthew. Mike Pompeo, Matthew, on his way to Russia from Brussels where he talked Iran with European leaders today. Let's have a
listen to what he said just yesterday.
(BEGIN VIDEO CLIP)
POMPEO: We're not going to miscalculate. Our aim is not war. Our aim is a change in the behavior of the Iranian leadership. We hope the Iranian
people will get what they finally want and what they so richly deserve.
(END VIDEO CLIP)
ANDERSON: Will that assuage any doubts in Russia about the intention of the U.S. with regard to Iran at this point?
MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: I doubt it, frankly, because there is a complete lack of trust on the part of the
Russian leadership with the intentions of the United States when it comes to Iran. This is a country, remember, that Russia has been building an
ever-closer relationship with. It supplies -- it's building nuclear reactors across the country. It's got a close military and diplomatic
relationship. They are fighting side by side, Russians and Iranians, on the ground in Syria as well.
And I think whenever the United States moves to change the regime or to put diplomatic or military pressure on another country, from a Russian point of
view it's seen as an attempt to undermine its interests in the region and to replace those governments with more pro-western ones and to detract from
Russia's on influence in the region.
I mean, one of the big challenges of the Trump administration -- and the previous administration as well -- has been to try and drive a wedge
between the Russians and the Iranians. They've got this extraordinarily close relationship at the moment. Perhaps the closest is been really in
centuries of their very fractious relationship.
But the Trump administration has so far categorically failed to do that. And we know that when Mike Pompeo, the U.S. Secretary of State, finally
does make it to Russia.
[11:15:00] He will be going to Sochi in southern Russia to meet with Vladimir Putin, the Russian President and the Russian Foreign Minister as
well. They will be talking about Iran, as well as a host of other issues, like Venezuela, like Syria, like arms control. But I'd be very surprised
indeed if anything is said in that meeting that manages to convince the Kremlin to back away from its Iranian ally -- Becky.
ANDERSON: We've been discussing the positions with regard politics, geopolitics and Moscow, Washington, the UAE, Saudi. What about, Fred, how
people are feeling on the ground in Tehran at this point and around the country?
PLEITGEN: Yes. Well you know, yes, you're absolutely right, it's become very difficult for folks here on the ground who live in Iran, for Iranians.
Because prices have been skyrocketing. The currency, obviously, has been in a freefall really. And more and more products are simply not available.
And that really goes through a lot of sectors. When you talk about basic things like the food people eat. But you're also talking for instance
about the medical sector as well. Where hospitals have been telling us it's very difficult for them to get a lot of the medications they need, to
get all the parts for some of the medical machines that are needed as well. It's very difficult for a lot of people.
And I think for many Iranians, on the one hand, of course, they also do have a little beef with their own government. They don't think it's been
adequate in supplying people with what they need. A lot of people already were quite disappointed in the nuclear agreement even before the United
States pulled out. They didn't think that it brought them the economic benefit that they had hoped would happen. It happened in certain sectors
like the oil and gas sector for instance which is picking up. But in others, the investment didn't come as fast as people wanted.
Now, of course, with the Trump administration laying these heavy sanctions on Iran, things have been even more difficult. Which obviously makes
things difficult for President Hassan Rouhani here in Iran as well.
Now on the flip side, of course, that doesn't mean that the Trump administration is necessarily -- or it doesn't mean at all that the Trump
administration is endearing itself to Iran. He makes people very angry at the White House for these crippling sanctions. A lot of people of course
here suffering under these sanctions. Thinking the sanctions hit the actual normal people without actually hitting top government officials,
without actually really hitting the military as well.
So certainly, you are not going to find a lot of people in Iran who are in favor of the current course that the White House seems to be on.
Especially if you look at for instance individuals like John Bolton, the national security adviser, certainly not a man who is very popular here on
the ground in Iran.
But the entire situation between the United States and Iran, the current situation that it's in is having a devastating effect on this country.
It's having a devastating effect on the economy. And so there are a lot of people who really on the one hand are suffering under these circumstances
and what might even be worse is they don't see a way out of this. They don't know how things are going to move forward. They don't see things
getting better any time soon. That certainly is something that really collectively weighs on a lot of people here -- Becky.
ANDERSON: And the question is, what happens next? Fred, thank you. Fred's in Tehran. Great access there. John Defterios, always a pleasure
here with me in Abu Dhabi, in important part of the story that being the oil markets. Matthew Chance in the ever-important capital of Russia and
Nic Robertson in the Gulf of Oman. To all of them, we appreciate it.
Human rights groups are asking Iran to stop what they call its worse crackdown in a decade on women advocating for rights in the country. Later
in the show, we're going to take a look at the story of one activist, Nasrin Sotoudeh is a lawyer. She was arrested last June at her home in
Tehran. Her family says she has now been sentenced to three decades in prison and 148 lashes. More on the calls for her release coming up later
this hour.
Also still to come on CONNECT THE WORLD --
MATT MAZZONCINI, KIANO'S LEGAL GUARDIAN: I was like, is that Kiano? And then I just started screaming, you are kidnapping our child right now. You
are kidnapping our son.
(END VIDEO CLIP)
ANDERSON: An American couple in Kenya demanding answers after police burst into their home and took their 3-year-old boy away. But authorities say
they were helping the child.
Plus, a warning that China ignored. Beijing now retaliating for new U.S. tariffs, defying President Donald Trump and sending markets into a
tailspin. More on that a little later.
And the celebration after the victory. The ending of one of the most epic Premiere League football seasons in history. Stay with us for all of that.
[11:20:00] (COMMERCIAL BREAK)
ANDERSON: You are watching CONNECT THE WORLD. I'm Becky Anderson for you. 7:22 here in the UAE.
To Kenya where an American couple is desperately searching for answers after police raided their home and took their 3-year-old son. They call it
kidnapping. But Kenyan officials say they rescued the little boy. The country now divided over who to believe. Robyn Kriel has the story.
(BEGIN VIDEOTAPE)
ROBYN KRIEL, CNN CORRESPONDENT (voice-over): Kenyan police enter an American couple's home in Nairobi and take away their little boy.
DAISY MAZZONCINI, KIANO'S LEGAL GUARDIAN: I had just finished putting him to bed. And he had just fallen asleep. And I walk out of his room and I
see all these people in the living room and I look at Matt's face and I think I just knew something was really wrong.
KRIEL: Kiano, who is Kenyan, was found in a ditch as a newborn emaciated and sick in a plastic bag along with a twin who later died. Since he was
six months old, he's lived with Daisy and Matt Mazzoncini.
The couple were named as legal guardian in the children's court of Nairobi in 2017. But they say that plain clothes police showed up at their home
and told them that the guardianship order was fraudulent.
DAISY MAZZONCINI: I felt they were going to take him, but you now, there was nothing we could do. I mean, at this point there was 13 people, you
know, like Matt said, they had literally made a human wall.
KRIEL: The group offered no I.D., no search warrant or court order.
MATT MAZZONCINI: And I just stood up and started yelling. I was like is that Kiano? And then I just started screaming, you're kidnapping a child
right now. You are kidnapping our son.
KRIEL: After Kiano was taken away, the Kenyan police director of criminal investigations tweeted from their verified account.
DCI KENYA: Detectives acting on information, worked around the clock to rescue 3-year-old baby John Kiano alias John Xavier from American citizens
Mr. Mathew Sean Mazzoncini and Ms. Daisy Louise Wake Mazzoncini who had planned to travel with the baby back to the U.S. Child is well and in safe
hands.
KRIEL: The tweet was later deleted. CNN has reached out to Kenyan police for comment but they did not respond.
The couple alleges their ordeal started when the orphanage where he used to live contested their guardianship in court. The judge ruled in the
couple's favor and that's when they say orphanage employees started harassing them.
[11:25:02] DAISY MAZZONCINI: They would come to the gate of where I was living, where we were living, and you know, wanting to see him. I would
get reports of this when I was out. All these people came in a white van. They were blocking the driveway. They refused to leave.
So, I reported that to the police. We actually ended up having to get a restraining order against that home.
KRIEL: When CNN contacted the Mogra Children's Center they hung up on us. The Mazzoncini's applied to take Kiano to the U.S. for medical care for his
severe epileptic seizures on the advice of Kenyan doctors. The situation escalated.
Kenya's Child Welfare Society, a semiautonomous government agency, accused them of attempted child trafficking and said the guardianship was
fraudulent because they are not Kenyan.
IRENE MUREITHI, CEO, CHILD WELFARE SOCIETY OF KENYA: A Kenyan child cannot be given right now to a noncitizen, and that is law.
UNIDENTIFIED FEMALE: OK.
MUREITHI: That overrides every other option.
KRIEL: While this is true for adoptions, it's not true for guardianship. Under Kenya's Children Act passed in 2001, guardians are not legally
required to be Kenyan citizens or residents.
Kenya's Child Welfare Society says that Kiano is in safe custody but it's been more than a month since he was taken from the Mazzoncini's home, which
was the last time they saw him.
MATT MAZZONCINI: You're funny.
KIANO MASSONCINI: You're funny.
DAISY MAZZONCINI: I just think of him being all alone and not understanding, like, where mom and dad went. And that's really hard. You
know, you've been through a lot in his life and, you know, we are the only parents he's ever known.
KRIEL: And the Mazzoncini say they won't rest until their boy is home.
Robyn Kriel, CNN, Nairobi.
(END VIDEOTAPE)
ANDERSON: We've got more on this story at CNN.com. It's been more than a month since Matt and Daisy Mazzoncini last saw their 3-year-old son. They
are demanding answers. Follow the couple's search to find out what happened to their child and why, that is CNN.com.
You are watching CONNECT THE WORLD. I'm Becky Anderson for you. We are out of Abu Dhabi.
The world holds its breath over U.S./Iran brinkmanship. Not least those in this region. Two experts will share their different views on how both
countries are handling this standoff.
Plus, why a 16th-century Persian battle could be a valuable history lesson for Donald Trump. Back after this.
[11:30:00] (COMMERCIAL BREAK)
ANDERSON: Let's get you back to breaking news this hour. Stocks on Wall Street plunging. They have been down as much as 600 points, now off just
under that, more than 2 percent lower. A trade war between the world's two largest economies escalating as China retaliates for new U.S. tariffs. As
you can see the Dow there down deep in the red. Reacting to Beijing's announcement that it will raise tariffs on $60 billion worth of U.S. goods
starting June 1.
Let's get you to our reporters on this. Matt rivers is live in Beijing. Julia Chatterley is at the New York Stock Exchange. Let's start with you
in Beijing, Matt. The U.S. President said don't do it. Don't back out. You had a great deal. But they did it. They've announced the tariffs.
Why?
MATT RIVERS, CNN CORRESPONDENT: Well they said they were going to do it because China, frankly, can't look weak. If the United States does their
own thing, which they did on Friday raising tariff rates on $200 billion worth of Chinese imports, well China can't exactly sit back and not do
anything on its own, at least in their mindset. Because then they would lose weak. Then they would lose the trade war.
And don't forget, they have their own domestic political audience here in China. And so, China basically just followed through on their word. As
soon as President Trump announced those tariff increases on Friday, China came right out and said, we're going to retaliate. So despite the
President's tweet saying China better not retaliate, or they shouldn't retaliate. Well, there was never a question of if they were going to
retaliate, it was when and how. And tonight here in Beijing, this morning U.S. time, we found out how they were going to do it, $60 billion in new
tariffs, roughly $60 billion of goods facing new tariff now, ranging from 10 percent to 25 percent.
But you know, that's a relatively in-kind retaliation, I think. They are not escalating beyond what the U.S. said. But they are doing what they
said they were going to do. And it wouldn't be a surprise if you heard the ministry of foreign affairs briefing earlier today before these tariffs
were announce -- let's place you a little bit of that.
(BEGIN VIDEO CLIP)
GENG SHUANG, CHINA FOREIGN AFFAIRS MINISTRY SPOKESMAN (through translator): China will never yield to external pressure. We have the determination and
the capability to protect our lawful and legitimate rights.
(END VIDEO CLIP)
RIVERS: China thinks they are in the right here, Becky. And you know, it's interesting, when they announced this. They could have announced it
Friday or Saturday or Sunday. But they chose to announce it approximately one hour before U.S. stocks opened. That was not by accident.
ANDERSON: It's called negotiation. Let's face it, Julia, certainly, disrupting the markets. Not the only thing that's probably driving these
markets lower, but investors don't like this uncertainty. Do they?
JULIA CHATTERLEY, CNN BUSINESS ANCHOR, FIRST MOVE: They don't. And remember, in just the space of a week, we've gone from thinking a deal was
going to happen, to it really feeling now that these sides couldn't be further apart. I mean, as Matt said, we had the Chinese retaliation one
hour before the market opened, surprise, surprise.
But investors are also reacting to a weekend full of rhetoric from President Trump as well. One of the comments he made, we've got China
right where we want them. I think China arguably would beg to differ here. What we're seeing is some sort of 2 percent, 2 1/2 percent losses, 3
percent for the tech stocks today. But we're still -- and I emphasize still carefully only some 4, 5 percent off recent record highs for these
U.S. markets. And we've had a host of analysts coming out and saying we could see a 10, even in certain cases 15 percent correction in light of
what we're seeing now.
We're not just pricing out the optimism that was there about reaching a trade deal here. But what are the spillover effects? The hit to global
growth. You've got Apple, you've got Boeing. Trade sensitive, China sensitive stocks losing most in the session today. And that's no surprise.
The other thing, of course, is that the United States government hinted over the weekend that we might get further details of a whole host of fresh
tariffs on $325 billion worth of other goods, imports coming in from China to the United States.
[11:35:02] So they're not done yet.
But one bright spot -- and Matt said it -- was actually that the Chinese were pretty restrained here in the response. This was not an escalation
from China by any means. So it's a case of, watch this space. But right now I think investors appreciating for the first time that we are nowhere
near a deal. And we've been so optimistic up until now.
ANDERSON: Is it clear what else China has up its sleeve? Let's be quite frank. We can call this a trade war, or we can call this a heated
negotiation. But negotiation is what it is, Matt.
RIVERS: Yes, I mean, I guess it depends who you ask. If both sides haven't broken down negotiations, then, yes, I guess you could say that
both sides are still negotiating. Both sides have pointedly said they are talking at this point. Until that completely breaks off, then, yes, I
still think it's a negotiation.
But a trade war is also doing things to one another that impacts both sides negatively. Both the Chinese consumer and the U.S. consumer will lose out
if this trade war continues. There is no way around that.
Now you can make an argument from the U.S. side that now is the time to really battle the Chinese on economic structural issues here. That most of
the international community would say is unfair trade advantages China has taken advantage of for years. And that the U.S. consumer should suffer a
little bit now to make longer-term gains in the long run. It's an argument you could make. But explain that to a family who's trying to buy a
baseball glove for their kid and it's going to be 25 percent more. I don't know how long -- how well that argument holds up.
Where we are between the U.S. and China right now, it's basically unprecedented. Where it goes from here -- Julia just said it. It was a
week ago we were talking about a deal and it shows you how quickly this can change. And it shows you how far apart these two sides are. The U.S.
wants China to essentially change how it runs its economy by removing the state from state-run industry. It's a tall ask. And it's not clear where
middle ground is.
ANDERSON: Yes. Fascinating. With that, just take a look at the market for our viewers and folks. The market down more than 600 points now. The
drop that we saw at the beginning of the trading day that Julia has been reporting on and will continue to report on during the rest of this trading
day continues. 2.3 percent down now. Thank you, guys.
Well as Donald Trump deals with the China trade dispute, as well as escalating tensions with Iran, and he's also fighting what some consider an
all-out war closer to home. As Joe Johns now reports, the U.S. President's standoff with Congress is deepening by the day as he and his allies try to
block nearly two dozen investigations.
(BEGIN VIDEOTAPE)
JOE JOHNS, CNN SENIOR WHITE HOUSE CORRESPONDENT (voice-over): The Trump administration doubling down its stonewalling efforts against House
Democrats accusing them of breaking rules and norms governing congressional oversight. Adding, the White House will not and cannot comply with
unlawful demand made by increasingly unhinged and politically motivated Democrats.
According to analysis by "The Washington Post" the President and his allies are working to block more than 20 investigations. And House Democrats say
at least 79 congressional requests for documents, testimony and other evidence.
REP. ADAM SCHIFF (D-CA): The Trump administration has decided to say a blanket no, no to any kind of oversight whatsoever.
JOHNS: But Democrats warn they have their own tactics to achieve oversight of the Trump administration. Weighing whether they'll use Congressional
inherent contempt powers. Like jailing or for fining those who do not comply with subpoenas.
SCHIFF: I think if you fine someone $25,000 a day to their person, until they comply, it gets their attention.
JOHNS: House Judiciary Committee chairman, Jerry Nadler, already holding Attorney General William Barr in contempt. And he's threatening to do the
same for former White House Counsel Don McGahn.
REP. JERRY NADLER (D-NY): McGahn we'll hold him in contempt if he doesn't obey the subpoena.
JOHNS: It comes as the IRS and Treasury Department face a new deadline of Friday to hand over Trump's tax documents. The House Ways and Means
Committee also sending subpoenas to Treasury Secretary, Steve Mnuchin and the IRS Commissioner.
A top Republican in the Senate giving public advice to the President's eldest son who was subpoenaed last week by a GOP-controlled Senate
Intelligence Committee.
SEN. LINDSEY GRAHAM (R-SC): We don't need to go back into this environment anymore. You've been there for hours and hours and hours. And nothing
being alleged here changes the outcome of the Mueller investigation. I would call it a day.
(END VIDEOTAPE)
ANDERSON: Joe Johns reporting there.
Coming up, heavy U.S. weapons headed to Iran's doorstep. As the Secretary of State -- U.S. Secretary of State promises not to miscalculate the
situation.
[11:40:00] I'm going to speak with two experts with very different views on how both countries are handling the standoff.
And to the victors go the spoils. A dramatic end to the Premiere League season. And the celebrations of the victors continue.
(COMMERCIAL BREAK)
ANDERSON: Scenes there from the Iran-Iraq war of the 1980s. A devastating conflict which caused the loss of hundreds of thousands, perhaps more Iraqi
and Iranian lives. But Iran's President says current pressures coming from the U.S. are worse than those felt during that time of war.
I want to go further back in history to the 16th century. Things were even tougher for Iran then when a battle pitted the Ottoman and Safavid Persian
empires against each other. The Ottoman Empire won but you wouldn't know it from looking at this Persian fresco that depicts the battle. The
artwork adorns an Iranian Royal Palace and makes it look like their side won instead.
One of my next guests says, and I quote, what the self-serving historical distortion suggestions is shame of defeat but pride in the heroic valor
with which the Iranians resisted a foe. Donald Trump's administration should draw a lesson from the battle in the way the Persians digested
defeat.
Those were the words of Ali Vaez, Iran Project Director for the Crisis Group, who joins us from Washington via Skype today. We also have Alireza
Nader, CEO of the New Iran Foundation also in Washington. Before I come to you, Alireza Nader, Ali Vaez, useful history lesson you say. Just explain
a little further.
ALI VAEZ, IRAN PROJECT DIRECTOR, CRISIS GROUP (via Skype): Thank you, Becky. It's great to be with you. Look, I wrote this piece because I
realize that something that has become conventional wisdom in Washington is that Iran doesn't give in to pressure. It gives in in front of massive and
immense pressure.
I think this is an inaccurate understanding of Iranian culture and history. Iranians are not really good at surrendering. They might compromise
whenever they feel that the cost benefit is in their interest. But if the expectation is capitulation, that's simply is not in the cards. And what
the Trump administration is currently doing with its maximum pressure policy is basically pushing the Iranians into a corner that would result
eventually in the Iranians taking retaliatory measures of their own. Which could result in a direct military clash between Iran and U.S.
[11:45:00] ANDERSON: Alireza, there will be no capitulation according to the history books so far as Iran is concerned. Is that something that is -
- has been missed by this Trump administration?
ALIREZA NADER, CEO, NEW IRAN: No. I think that's actually very untrue. When we look at the Islamic Republic, the regime in Iran, it is under
tremendous pressure. But one thing Ali Vaez doesn't mention was that the Iranians hate this regime. They are in protest for the past year and a
half. In Tehran today, there were student protests. So this regime cannot count on its own people to come to its rescue. So maybe the regime will
not surrender. But I don't think the Iranian people will surrender to the regime's repression. And I think that's what we really need to look at.
What's happening in Iran? And I think this is a regime that's in danger of collapse or revolt.
ANDERSON: Let me just stop you there for a moment. Many experts will say -- and speaking to Iranians myself. They may not like the regime but they
hate the idea that the Americans are ramping up this pressure to the degree that they might expect some sort of strike on the country. They say,
however bad this regime is, it's not for the U.S. to sort it out.
NADER: Well it's not so black and white. I have talked to Iranians too who love the Trump administration maximum pressure campaign. They think --
I have been told by Iranians, we'll put up with anything so this regime is gone and we can really resume our role in the world as a really proud and
contributing country. So it depends on who you talk to, where you talk to these people. I know a lot of people who are in support of the pressure
campaign. I think it needs to go a step further. I think there should be very direct U.S. support for democratic opposition groups. There shouldn't
be engagement with this regime like people like Zarif who try to monopolize discourse and information. There are a lot of Iranians with various
attitudes and opinions we should hear from.
ANDERSON: OK. Let's bring up a couple of things we know to be fact here. Donald Trump, let's go through exactly what the U.S. President, Ali Vaez,
had to say late last week about the risk of military confrontation. Because that is the big question at this point. Is there at this point a
risk of a military confrontation? Have a listen to what he said.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We have one of the most powerful ships in the world that's loaded up. And we don't want to have to
do anything. What I would like to see with Iran, I would like to see them call me.
(END VIDEO CLIP)
ANDERSON: The White House then passed along a number, a phone number to reach Mr. Trump in case Iranian leaders wanted to chat with him. But it
doesn't seem like anyone has picked up the phone yet, Ali Vaez. Is it likely that anybody in Tehran will?
VAEZ: I don't think so. At least not until we know the results of November 2020 Presidential election in the U.S. It's just too late in the
game for the Iranians to engage with the Trump administration. And because the administration is pursuing maximalist demands, I think the Iranians are
simply not interested. If they decide to come back to the negotiating table, again, their culture and history shows they are going to revive
their leverage, which means they have to restart the nuclear program full force.
And with the war cabinet that President Trump has assembled, that means war. And this is where I go back to what my colleague, Alireza, was
saying. I just don't see how we can -- any of us can speak for the Iranian people. But I doubt that they would be too happy with a sanctions regime
that has devastated the Iranian middle class and would allow the Iranian hardliners to actually enrich themselves and benefit from. And if there is
a military confrontation between the two countries, them by definition, the security and intelligence establishment in Iran will become even more
powerful. In this would law them to monopolize the political sphere in the coming years.
ANDERSON: And this is important, Alireza. Because as we see the ramping up of external pressure, so we see or we are likely to see the enhancement
of internal fissures and more standoffs between the domestic political camps. Bottom line, is this question. Who will shape Iranian policy going
forward? Which camp is likely to do that? Because that will have a huge impact on what happens next.
NADER: Well, I will let you know what the students in Tehran said today. They said, hardliners, moderates, the game is over. Iranians reject the
distinctions. I think in D.C. there's a tendency to divide the Islamic Republic into these camps. But Iranians know the Islamic Republic for what
it is. It's 40 years of repression, 40 years of isolation.
[11:50:00] Yes, Iranians don't like to be isolated under sanctions. But I put the blame on the leader of Iran, Ayatollah Khamenei and the Foreign
Minister Zarif. They are pushing the international community to confrontation. We've seen that in the Persian Gulf. There have been
attacks against Saudi and Emirati shipping. Information is not clear. I'm not going to blame anybody. But who has consistently threatened to close
the Strait of Hormuz? Who is threatening military intervention in intervention?
ANDERSON: Ali Vaez, let me put the last question to you before want to move on just slightly. But Ali Vaez, the U.S. President says, give me a
call. I just want a better deal. The better deal being a nuclear deal plus a deal that includes the issues of ballistic missiles owned by Iran
and their expansionist tendencies and activities around this region. Why not pick up the phone? Why wouldn't the regime eventually say, you know
what? Going forward, this is clearly a U.S. President who has not changed his position so far as his deal is concerned. And he's getting the support
now of the Europeans.
VAEZ: Sure. Look, the reality is I think the President is primarily motivated by getting a better deal with the Iranians. But he has
surrounded himself with people who have a track record of seek regime change or war with Iran. And as you saw in the rhetoric of Alireza, it's
the same thing. They believe that the only way of changing the behavior of this regime is by changing the regime itself.
(CROSSTALK)
NADAR: That's what the Iranian people want. It's not people in D.C. that want that by the way.
VAEZ: I can speak on the behalf of the Iranian people. And if the Iranian people want --
ANDERSON: Hang on, Al Vaez.
VAEZ: And if the Iranian people what to, they should be able the ones who will push forward. There is simply no precedent of the U.S. coming in
through economic devastation of another country, being able to bring about democracy or pro-American regime. Just look at the record of regime change
that the U.S. has affected in this part of the world.
NADER: Economic warfare worked with the Soviet Union pretty well, actually. There's a precedent for it --
VAEZ: And you've got Putin's Russia.
NADER: -- and this claim that anybody who wants this regime to be changed that's fighting for the freedom of the Iranian people wants war, that's
exactly the talking point that Zarif and Khamenei want you to hear in D.C. If you look at --
(CROSSTALK)
ANDERSON: Let me -- I'm going to stop you there, guys. The U.S. claims it isn't regime change. Although they say it would effectively -- they
wouldn't be sorry to see this regime go.
I do want to bring up Nasrin Sotoudeh. She's an Iranian lawyer who is well known for representing human rights defendants and women who protested
against wearing the mandatory head scarf in Iran. Her family says she's recently been sentenced to 38 years in prison and 148 lashes. Iranian
state media reports she's been sentenced to just seven years. Ali, the U.S. State Department is condemning what they say is a, quote, growing
crackdown on women advocating for human rights in Iran. To both of you, your thoughts starting with you, Ali Vaez.
VAEZ: Look, I think the U.S. would have credibility to put pressure on Iran for improving its human rights record. It would apply the same
standard to other countries in the region, which are U.S. allies. Look at human rights situation in Saudi Arabia or in the UAE or Bahrain or in other
places the U.S. basically turns a blind eye on.
Got it. You've got 30 seconds, Alireza.
NADER: Emphasis on human rights I think is paramount. The last administration did not do it because of the nuclear agreement. I fear the
next administration if it's a different administration will ignore human rights. Nasrin Sotoudeh is a symbol. But she's the tip of the iceberg.
There are millions of Iranian women fighting for freedom today. And I think we should defend our rights.
ANDERSON: We'll have you both back, gentlemen. Thank you.
You are watching CONNECT THE WORLD. When we come back, now the Premiere League champs celebrated their title.
(COMMERCIAL BREAK)
[11:55:00] ANDERSON: Now for our Parting Shots. We return to a truly incredible end to the English Premiere League. There was a huge
celebration in Manchester on Sunday after Man City edged Liverpool for their second consecutive Premiere League title. Fans of Manchester City,
that's one side of the city, of course, the blue side, celebrated by singing, unofficial theme song, "Wonderwall". Noel Gallagher, a huge fan
of the club. He even showed up in the locker room.
I'm Becky Anderson. That was CONNECT THE WORLD. Thank you for watching wherever you are in the world. Have a very good evening.
END
