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AT THIS HOUR

Trump Holds First Cabinet Meeting With New Chief Of Staff; Despite The Past Week, Trump Denies "Chaos" Inside White House; Trump, Sessions Face-To-Face For First Time Since Shamings; After Failures, Trump Dares GOP To Act On Obamacare. Aired 11-11:30a ET

Aired July 31, 2017 - 11:00   ET

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


[11:00:00]

POPPY HARLOW, CNN ANCHOR: "AT THIS HOUR" with Kate Bolduan begins right now.

KATE BOLDUAN, CNN ANCHOR: Thank you so much, Poppy. Hello, everyone. I am Kate Bolduan. Welcome to the first day of the rest of the Trump presidency. A fresh start this morning with a fresh face as the new White House chief of staff, retired general and former Homeland Security Chief John Kelly, sworn in a short time ago to replace Reince Priebus.

Followed by a cabinet meeting that included a lesser fresh base. Attorney general, Jeff Sessions, right now, his relationship with President Trump has turned remarkably sour in a remarkably short amount of time.

Moments ago, the two were in the same room, and face-to-face for the first time since the president kicked off his public shaming of Sessions. With Priebus out and Kelly in, is it all sunshine and rainbows at the moment? The president seems to think so.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES OF AMERICA: Good morning. This is our first cabinet meeting with General Kelly. He will be chief of staff, as you know. We all know him and respect him, admire what he's done. At Homeland, what he has done has been nothing short of miraculous.

I predict that General Kelly will go down in terms of the position of chief of staff one of the great ever and we're going to have a good time, but much more importantly, we are going to work hard and we are going to make America great again.

(END VIDEO CLIP)

BOLDUAN: He touted a lot of successes of the presidency so far in that meeting, talking about economic numbers. So, can the new chief of staff help jump start the president's agenda today? A lot of ground to cover on that.

Let's start with CNN's Sara Murray who is live at the White House. So, Sara, despite the past week, just forget it all the president says. I mean, the president denied any hint of a problem within his White House today.

SARA MURRAY, CNN POLITICAL REPORTER: That's right. But look, we all know that you don't oust your chief of staff and replace them with a retired four-star general if you don't want a change in direction in the way things are going in this White House.

Even staffers who are working in the west wing are hopeful that John Kelly will bring some kind of fresh start. That he might bring a little bit more order, a little bit of a quieter west wing one that's been plagued with staff infighting and back biting.

But they are also hoping that he can help sort of kick start the Trump agenda. The reality is the president had a bruising defeat last week. We saw health care collapse and as much as President Trump wants to blame it on the Democrats, that was at the hands of members of his own party.

So, everyone is waiting to see if the dynamic will change under Kelly. Of course, there's some skepticism about that because everyone knows the tone is set at the top. Many people near the White House, close to the White House in Washington aren't convinced that President Trump is prepared to change -- Kate.

BOLDUAN: Yes. The chief of staff, you can change. The president, is he prepared to change or has he change? We will see in probably the next 24 hours. Great to see you, Sara. Thank you.

Joining me now to discuss right now, CNN senior political analyst, Mark Preston, and Chris Whipple, the author of "The Gatekeepers: How the White House Chief of Staff Define Every Presidency." Appropriate today. Thank you for joining us, Chris. Great to see you both.

Try this on for size. How is this for expectation setting? He will go down as one of the great ever.

MARK PRESTON, CNN SENIOR POLITICAL ANALYST: Ever.

BOLDUAN: Ever.

PRESTON: I mean, anybody he ever hires or associates himself with, he always says that they will be the greatest, do the greatest, become the greatest. It's Trumpisms at its best.

BOLDUAN: Has John Kelly taking on the post, has the west wing fundamentally changed today?

PRESTON: No. Well, a couple of things, one, we were talking about this in the green room. I don't think the journal is going to be able to go in and necessarily change Donald Trump. Can he go in and organizationally change everyone below Donald Trump?

In some ways, perhaps just ignore what Donald Trump does with the tweeting and what have you and really try to enact change and get things done by working downward, and then up to Capitol Hill. BOLDUAN: Well, that kind of gets to an interesting point. You have said, I seen you say, Chris, it's mission impossible for General Kelly, if he doesn't have control over the west wing. Why is that? What does that look like?

CHRIS WHIPPLE, AUTHOR, "THE GATEKEEPERS": The first thing Kelly has to do is he has to figure out, is he working for a presidency or tv show. This White House has been profoundly stupid and quite frankly, unserious about governing for the first six months.

They can't do anything right. A guy like Scaramucci shouldn't be within 100 miles of a functioning White House. I think Kelly's first task if he hasn't removed Scaramucci's White House credentials by Friday, I think he's failed on job one. Failing that --

BOLDUAN: Really?

WHIPPLE: Yes, failing that I think it has to be clear that Scaramucci and everybody else reports to the president through Kelly. If they don't, with the possible exception of the family and Bannon -- if they don't, this cannot work.

[11:05:03] BOLDUAN: If -- so, that means, if the structure as is of yesterday remains in place, it doesn't matter who becomes chief of staff. Why is that gatekeeper role so essential? What aren't people getting?

WHIPPLE: The definition of insanity would be for John Kelly to try to take this job with the same authority that Reince Priebus had. We saw how that turned out. You know, the last time we had a general, by the way, as White House chief, it was Al Hague under Gerry Ford, after Nixon resigned.

That was a disaster. The reason it was a disaster is that Ford had the same idea Trump did, he thought he could run the White House by himself. Everybody had access to the oval, came and went willy-nilly. It was a disaster.

He wound up begging Don Rumsfeld to come in and powered Rumsfeld and he almost caught Jimmy Carter in the election as a result. If you don't do that, history is littered with the bones of presidencies that didn't understand. You have to have an empowered White House chief.

BOLDUAN: Mark, it's getting to, a little bit of what Chris is talking about. Peter Baker of the "New York Times" had a fascinating interview with one of the I think would go down as the greats in terms of the chief of staff.

Baker said that the job boils down to either focusing on the chief part of your title or the of staff part of your title. Success coming through, he says success is coming through focusing on the staff. What do you think the challenges are that Kelly is up against, if that's the case?

PRESTON: Well, loyalties from those that are already in position right now, including the family, mind you, Ivanka and Jared. The loyalties that they have to the president and not necessarily to the office.

Scaramucci is a perfect example of somebody who is going to come in and shake things up and everyone needs to be loyal to the president and he is going to fire anyone who isn't. The fact of the matter is those in the west wing who hold those positions should be loyal to the president and the fact that they are trying to get his agenda passed.

But first and foremost, they have to be loyal to the Constitution. They have to be loyal to the idea of getting things done. So, what we can't have, quite frankly, is this weekend to have Donald Trump come out and say let's get back into health care.

When you have the Senate Republican leader who is a good tactician saying on Thursday and Friday, OK, we didn't get it done, it's time to move on. Can't have that mixed message.

BOLDUAN: Go ahead.

WHIPPLE: Troubling thing to me, I talked to some ex-White House chiefs who have not had a phone call from Kelly. The first thing any serious White House chief would do, should do is pick up the phone to Jim Baker, the gold standard, call Ken (inaudible), for example, who was Reagan's successful last chief of staff.

He came in in a similar circumstance in a way. Reagan was on the ropes with the Iran contra scandal. There was the possibility of being impeached. Howard Baker and (inaudible) sat down with Reagan. They decided that if he lied to them, they were going to resign.

I think Kelly needs to go into the oval office, sit down with Donald Trump and draw a red line and say, if you want to have your tweets fine, but if you tell a lie on Twitter, I'm gone. You can find a third White House chief.

BOLDUAN: One thing that is fascinating that I saw this morning is much of what you heard the president in complimenting General Kelly on was his work over at the Homeland Security, what he has done with the border and immigration. Do you know who was working lock-step, hand in hand with General Kelly on that? Jeff Sessions over at Justice.

I did a joint interview with Kelly and Sessions to talk just about immigration and the border and the efforts that they are taking on. You have one of them who is getting accolades and the other who is on the outs of all outs.

PRESTON: That's why the whole issue of loyalty is not to the person, it should be to the country and to the Constitution. We have seen Jeff Sessions who showed retrained loyalty to Donald Trump all last year at a time when, you know, all his Republicans in Congress thought he was crazy for backing him.

Then, what have we seen? We saw that Donald Trump, President Trump, has turned on Jeff Sessions. We see that Rex Tillerson over at the State Department supposedly is having troubles right now with the White House, doesn't feel like the White House has his back. So, if you are General Kelly, you have to think to yourself, to Chris' point, if you lie, if you are not with me on these things, then I'm out. It will be interesting if he had that conversation.

BOLDUAN: John Kelly is not going to -- who knows how many interviews he is going to do. What is this signal the time, the indication you are going to get if there's a change? What are you looking for to see?

WHIPPLE: You're looking for an end to the Trump's unrestrained use of Twitter. You are looking for discipline. You are looking for -- I mean, this White House is completely broken right now. It would be a massive repair job.

First of all, it can't pass legislation or issue executive orders that are enforceable. It can't prioritize the president's agenda. Nobody knows what that is. It can't get anybody on the same page.

[11:10:03] Those are all the things that in a healthy, functioning White House, they all come down from the White House chief of staff. You can have robust debate, Bannon arguing with everybody else. At the end of the day, when the president makes a decision, everybody needs to fall in behind the White House chief of staff and execute it. That's how you'll know if this is working.

BOLDUAN: That lays it out very easy. He's got an easy job ahead of him starting today. That seems very obvious from this discussion. That's the name of your next one. Piece of cake, the life of a chief of staff. Great to see you, Chris. Thank you so much. Mark Preston as well.

President Trump daring Republicans to act on health care after last week's big failure, including his threat to cut off help to low-income Americans under Obamacare.

Plus, Russia's revenge, Vladimir Putin ordering hundreds of American diplomats out after Congress supposed to slap Moscow with sanctions. Now the kremlin says this is just the beginning.

And, what is it about Chris Christie and sporting events? Honestly. A new chapter when the New Jersey governor confronts a hackler basically nose-to-nose. See what happened.

(COMMERCIAL BREAK)

[11:15:02]

BOLDUAN: Is President Trump ready to move on after last week's big fail in Republican efforts to dismantle Obamacare. Short answer, it appears not, instead, throwing around taunts and threats at his own party in the aftermath, including this statement he put out on Twitter just a short time ago.

"If Obamacare is hurting people, and it is, why shouldn't it hurt the insurance companies and why should Congress not be paying what public pays?" But there's more to it than meets it eye or the tweet. We'll get to that.

CNN's national correspondent, Suzanne Malveaux joins me live from Capitol Hill. So, Susan, what is the president threatening right now?

SUZANNE MALVEAUX, CNN NATIONAL CORRESPONDENT: Kate, you know, what we have seen over the weekend is the combination of threats, cajoling, shaming, whatever you want to call it here. But essentially what he is saying is that the government is not going to provide bailouts for insurance companies or members of Congress.

The way that most members of Congress get their insurance is through the D.C. exchange which in part is subsidized by the federal government under Obamacare. Now what the president has been saying pretty consistently is that he is going to allow Obamacare to implode.

There are a couple of threats that seemed quite serious. One of them is to take away the government subsidies to insurance companies that actually allow low income folks to afford coverage. That would be to the tune of $7 billion.

The other thing that he is talking about is not enforcing the individual mandate, which really allows and requires that young, healthy people are part of the system. So, those are the things that he is tossing out.

But there is definitely, Kate, a back and forth, a blame game that continues and the real question is whether or not they are going to be Democrats and Republicans who are willing to continue to find a solution or at least ways to fix, tinker around the edges, the problems facing Obamacare. This one congressman from earlier this morning says, no, the Democrats own it.

(BEGIN VIDEO CLIP)

REPRESENTATIVE CHRIS COLLINS (R), NEW YORK: They are going to wear it, you know? We said to America and America agrees, Obamacare has failed, it's failing. It's imploding. I have suggested to the president we absolutely end the cost sharing revenues on Tuesday, that's tomorrow, to insurance companies.

(END VIDEO CLIP)

MALVEAX: So, that was Chris Collins, Senator Susan Collins of Maine has a different idea. She wants to bring Republicans and Democrats together to try to figure out ways to stabilize the market.

There's also another group on the House side called the problem solvers caucus trying to do the same thing, Kate. So, we'll see how this goes.

BOLDUAN: We will have to see. Chris Collins and Susan Collins no relation and definitely not on the same page when it comes to health care either. Great to see you, Suzanne.

Joining me right now to discuss is CNN senior political commentator, Rick Santorum, a former Republican senator and former Republicans presidential candidate. Also with me, CNN political commentator and Republican strategist, Ana Navarro.

Hello, friends. Senator, first to you. Cutting off payments to insurers -- the payments are used to help low income folks afford coverage. Is that a good idea the next step in your mind?

RICK SANTORUM, CNN SENIOR POLITICAL COMMENTATOR: You know, I think the president has to start to get tough with these Republicans who are walking away from trying to fix health care. If it means shaking up the system a little bit for the short term, I think it's not a bad thing.

If you look at what insurance companies have already baked in the fact that this money is going to go away with their increases for next year. So, I don't think it will be a huge shock to the industry.

But it will be a shock to Washington. Look, I think the president has to take some leadership here. I think he wants to do that. As I have said many times, I think he needs to go outside Washington. Washington has failed.

Now it's time to do what we did in 1996 when we did the last entitlement reform on welfare. That is go outside of Washington, to bring in our Republican governors from around the country, meet and come up with a solution that drains the swamp, gets the money out of Washington, puts it back in the hands of governors.

This is something that, in my opinion, should have been done from the beginning. To paraphrase Winston Churchill's Republicans will do the right thing after they've tried everything else first.

So, they failed on everything else. Now it's time to get the right solution that worked in the past. Donald Trump can be the savior here, be the leader in working with Republican governors outside of Washington to make this happen.

BOLDUAN: So, you have the Rick Santorum of the world saying buck up fellas and ladies, let's get to it, get to the business of it and continue fighting to reform the health care system.

But Ana, Republicans on the Hill, they seem to not be there. They seem ready to move on, move on to tax reform, leave health care, the fight for another day or completely, I don't know.

If you look at the president's Twitter feed, almost a dozen tweets on health care or the process in the Senate that he was attacking, just over the weekend. He's not ready to let it go. Where does that leave everybody?

ANA NAVARRO, CNN POLITICAL COMMENTATOR: Well, here is the problem. First of all, you know Donald Trump is a dog with a bone. He never lets go of anything, right? This, for him, was a huge political blow.

[11:20:06] It was a blow to his ego. He's the art of the deal guy. He couldn't get the deal done. He's never going to let it go and frankly, he shouldn't let it go and the American people shouldn't let it go. Congress shouldn't let it go because this is a system that needs to be fixed.

Not doing anything is not an option. There are too many flaws with Obamacare as is. It's going to end up collapsing if it is not a solution offered. There's a bigger problem here.

When I have been hearing this entire discussion now, folks talking about Democrats are going to wear it or Republicans failed, the president is flogging Congress and flogging the Senate for having failed. What's not being talked about are the people who need insurance.

What's not being talked about are the lives that are at risk. At some point, we have to stop seeing this as a political chess game and we've got to start seeing it as an American crisis that needs to be solved and put the focus where it needs to be.

BOLDUAN: What you're talking about, Ana, the president spoke directly on Friday. Senator, let me play it for you. This is another route that the president is suggesting that Congress can go. It's basically just leave it and let it implode on its own. Listen to this.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES OF AMERICA: You know, I said from the beginning, let Obamacare implode and then do it. I turned out to be right. Let Obamacare implode.

(END VIDEO CLIP)

BOLDUAN: So, is that the president trying to work for a solution? I mean, do you endorse that move, Senator?

SANTORUM: Look, I think anything the president could do to shock the system here, to get them to continue to work on this is a good thing. I agree --

BOLDUAN: Maybe he doesn't believe it. He's just trying to scare them straight?

SANTORUM: Look, the president wants a success here. He doesn't want Obamacare to implode on his watch, and him just sit there and do nothing about it. He wants to fix the problem. That's why he's tweeting and pushing Congress.

Look, this is an opportunity for Donald Trump to show that he can lead. This is an opportunity to say look, we are not going to do it the Washington way. We are going to go outside, bring people in, Democrats and Republicans, get input on this, get this money out of Washington, back to the states, let Democratic and Republican governors and their legislatures fix this problem.

Get rid of Washington centric health care and let the states do what they do best, which is what we saw under welfare, deliver services closer to the people. This is exactly what he campaigned on and now he has the opportunity to do that. NAVARRO: I think his words are not only irresponsible, I think they are inhumane. What are we going to do? If Obamacare implodes, and I can see, you know, what he's tempted to do that. Now it's easy for him to do that. He is a rich guy with health insurance.

Everybody in his family, everybody he cares about has health insurance. There are very many Americans who need Obamacare and are on it right now. What are we going to do with those sick people if it implodes? What are we going to tell them?

What are we going to tell the parents of those children? What are we going to tell the spouses? What are we going to tell these Americans? So, I think that's just -- you know, at some point, get over the defeat. Get over the political posturing and get back to work.

Get back to forming a plan that actually works. Get the input from Republican governors and Democrat governors. Get bipartisan leadership to start working it and do what Congress is supposed to do, compromise and address a national crisis now.

BOLDUAN: What will happen, at least as it stands now, they are going to point the finger at each other. One thing we have seen change in Washington, your reaction to General John Kelly stepping in as chief of staff, Reince Priebus out. Do you think this changes everything?

NAVARRO: I don't think it changes everything because frankly, you know, I have never seen a staff or a level of functionality of an office that is not an accurate reflection of the principal. The principal here is Donald Trump.

Now I will tell you I know John Kelly. I got to know him well in Miami when he was South Com commander. He is excellent. He is a leader. He commands respect and authority. He doesn't have much patience for fools and for lack of discipline.

So, I think folks like Scaramucci, I think a lot of the folks who are in that oval officer right now that have had walk-in rights, that oval office feels like a public bathroom where anybody can go in at any moment and whisper into the president's ear.

I think he's going to bring some order to that. The question is, can he change Donald Trump? Then live with that. Any woman who tries to change a man, it takes more than a general, it takes a miracle.

BOLDUAN: Senator, let me ask you this. With Reince Priebus out, do you have a concern that the president has fewer and fewer like no ties to the party left in his inner circle?

[11:25:05] SANTORUM: Well, I mean, he has Steve Bannon, which is really important. That's a base that is very important to this president and I think that will continue.

BOLDUAN: Basically, he wanted to blow up the Republican Party at one point?

SANTORUM: Well, he doesn't have any sort of traditional Republican like Reince Priebus. The bottom line is, most of the people working the administration, there are Republicans that are active Republicans for a long time. I'm not that concerned about that.

The bottom line for General Kelly is, he's a Marine. He's someone who gets the marching orders and tries to execute. That's going to be the most important thing to bring to it, this idea of being able to execute the game plan and follow through. Hopefully that will improve the efficiency and effectiveness of the White House.

BOLDUAN: We will see. This is a day I can say that and no one can correct me. Great to see you both. Thank you so much.

President Trump under fire for encouraging police to rough up suspects during their arrests. Now the nation's police departments are pushing back against the president, the man who called himself the law and order candidate.

And Vladimir Putin strikes back at the U.S. over impending sanctions, booting hundreds of employees from Russian missions, U.S. missions in Russia with a warning that this may be just the beginning.

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