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Trump's Trade War; Chaos Inside the White House. Aired 3-3:30p ET

Aired March 2, 2018 - 15:00   ET

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


[15:00:02]

BRIANNA KEILAR, CNN HOST: Isn't that right?

MICHAEL BENDER, CNN POLITICAL ANALYST: Yes.

I mean, this -- this whole Porter saga is just striking for a number of reasons. One is the staying power this -- this has had. Porter resigned in the first month of February. Here we are in the first month of March still talking about it.

And this is in a sort of era of Trump, where one controversy leads into the next and is eclipsed by the next news cycle on a weekly or even daily basis. And here we are still talking about the Porter saga.

And do we know so far? That it has led to a rewrite of the security clearance issues. It's intensified the area of disagreement between Jared Kushner and John Kelly.

And we know -- we reported in "The Wall Street Journal" last night that it had a direct correlation to the trade policy yesterday morning that Mr. Trump announced. Rob Porter played a role as sort of a gatekeeper of the Oval Office.

And one of his jobs there was to run point on trade policy. Rob Porter, along with Gary Cohn, we will use some shorthand here and call them globalists when it comes to trade. They had effectively isolated some of nationalists, some of the projectionists like Peter Navarro.

With Rob Porter out of the building, Peter Navarro has worked his way back into the Oval Office. President Trump gave him a promotion just a week ago and yesterday signed off on one of Mr. Navarro's top priorities, which are these tariffs on aluminum and steel, which caught a lot of White House officials, including Gary Cohn, by quite a bit of a surprise.

KEILAR: Michael Bender, thank you very much with us from the White House there.

I want to talk more about all of this with CNN White House correspondent Abby Phillip, who was also in that meeting with Chief of Staff John Kelly, and our chief political analyst, Gloria Borger, who has a really excellent piece today on CNN.com about all of this chaos that we have seen inside the West Wing this week. You were in this meeting, Abby. So, you actually heard the chief of

staff give this defense of himself with this timeline. But does it add up?

ABBY PHILLIP, CNN POLITICAL ANALYST: I have to say, it was extraordinary in that room, because the timeline doesn't really even comport with what we publicly know.

But it certainly doesn't comport with what we know from the sources that we've spoken to over the course of the last month. John Kelly is saying that, February 6, the day that "The Daily Mail" came to the White House with this story, is the first time that he heard the allegations of domestic abuse against Rob Porter, and that he blamed a mixup for -- a press mixup for the fact that the following day the White House continued to not only defend Porter.

They claimed that he would be staying on at the White House for several weeks. And then Kelly continued to have his name on a statement praising Porter. They didn't even try to retract the statements of praise that the White House had collected from members of Congress for Porter that were out in the public on Wednesday, after the photos, one of Porter's ex-wives was published in "The Daily Mail."

John Kelly said today that Rob Porter resigned twice on the day that "The Daily Mail" came to them. But the next day, they continued to defend him. The next day, Sarah Sanders went to the podium and she said he would be staying on for several weeks longer.

It doesn't add up at all. We also know from our sources that multiple people in the White House were told that there were serious problems with his security clearance process due to abuse allegations in his past.

Kelly didn't address that. He stands by his comments on a somewhat legalistic ground that the White House Security Office, which deals with these clearances, didn't specifically tell him or the White House counsel, Don McGahn, that there was a problem with domestic abuse in Rob Porter's clearance file.

KEILAR: Gloria, great column out today.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Thank you.

KEILAR: Fantastic. And it really does -- it's so well-sourced, where you're talking to people who are in -- they're in Donald Trump's corner. They want him to succeed. They're his allies.

BORGER: They do.

KEILAR: And yet they are looking at what they worry about as an unraveling, especially as they see the president become increasingly isolated by these departures this week and also in previous months.

BORGER: Yes. And I think what was striking to me is that they were sort of

concerned about the velocity at which all of this is moving, the intensity of it, and the public nature of everything, of this unraveling, as I call it.

One person said to me, look, Donald Trump processes things differently from the way we do, that he thrives on this kind of chaos. But then there's a but. And the but is from other friends saying, look, this past week feels very different to them.

The reason it feels different is that it seems a little bit out of control. You know, you had the Hope Hicks' resignation, the president lashing out again at his attorney general at the Justice Department.

KEILAR: Who hit back.

BORGER: Who hit back.

KEILAR: Much to the president's chagrin.

BORGER: Exactly.

You have the whole problem with Jared and his security clearance being downgraded, which was an indirect result of the Porter controversy. And all of this coming at him at the same time.

[15:05:03]

And then, of course, the president surprising people on his staff, not only by endorsing gun control, which he seemed to unendorse last night after meeting with the NRA, but then on trade and tariffs and calling a meeting and announcing a policy that had not even been vetted.

So everybody is thinking things have become a little unhinged here.

KEILAR: And it's all moving so fast.

BORGER: Yes.

KEILAR: But there's also this stunning report. You know, you always get the sense that maybe no one is safe around President Trump, that everyone can have an expiration date. But you certainly have this idea that maybe Jared Kushner, his son-in-law, and his daughter Ivanka Trump were immune from that.

Perhaps not the case. Listen to Maggie Haberman, who broke a story in "The New York Times" about the president asking his chief of staff to help push out his own daughter.

(BEGIN VIDEO CLIP)

MAGGIE HABERMAN, CNN POLITICAL ANALYST: This is really less about Ivanka Trump. It's primarily about Jared.

But he has said repeatedly to aides, Ivanka Trump gets terrible press because of me. This is all people taking attacks at me on to my daughter. This is terrible.

However, Jared Kushner is someone with whom he is now frustrated. He goes back and forth between being -- feeling bad about what has happened and then being irritated by the fact that Jared Kushner has become a liability of sorts in his own right.

He is getting a ton of negative headlines on his own. It's all about the meetings he is taking. There's a lot of focus on investigations. He will talk about Jared is getting killed, Jared is getting killed. And he's not always saying it with any sense of sort of self- reflection or this is an extension of how they're looking at me.

Trump doesn't like when people attract negative headlines that could be a problem for him. And now he has a member of his extended family getting that in droves.

(END VIDEO CLIP)

KEILAR: What do you think about this, Gloria, as you watch this?

BORGER: Well, I think that the president has said over and over again to friends that I talk to, Jared and Ivanka are having a really tough time here. I'm not so sure they should have come to Washington. It's because of me and by extension they get attacked.

However, now Jared is getting attacked or stories are being written about him. The special counsel, from our reporting, is asking questions about his conversations with foreign leaders and his business dealings and suddenly the president says, whoa, wait a minute. He could be a liability to me.

But you can't tell Jared to leave without having both of them leave. And one source said to me this week, you know, maybe what will happen is that they will end up becoming very active in the reelect end.

And that may be the way out.

PHILLIP: The fallback plan or the path that could be open for Jared and Ivanka to leave Washington and leave the White House.

And clearly people around the White House that I talk to, I know that Gloria talks to, the stories about Jared having meetings with businesspeople, then those businessmen turning around and offering loans to his private companies are genuinely damaging.

They are genuinely sort of beyond the pale of even the scandal in this White House. And so that's one of the reasons these stories have gone beyond just sort -- just what the president often characterizes as a witch-hunt for him and people around him to something that on its face hard to explain. And that's why we are where we are today.

KEILAR: It's amazing. What an amazing week.

Abby Phillip, Gloria Borger, thank you so much. And next, in what's already been a chaotic week in the West Wing,

we're now learning why the president's daughter Ivanka is having trouble getting security clearance. It may have to do with an ongoing FBI probe. Details next on that.

And no big deal. Commerce Secretary Wilbur Ross uses a can of chicken noodle soup to justify and defend President Trump's tariff on aluminum and steel.

This amid new reports that the president's chief economic adviser threatened to quit over Trump's tariff war.

(COMMERCIAL BREAK)

[15:13:01]

KEILAR: First daughter and White House adviser Ivanka Trump now at the center of an FBI probe.

Sources tell CNN the FBI is zeroing in on Ivanka's role in securing a real estate deal for the Trump International Hotel and Tower in Vancouver, Canada. This extra attention could make it more difficult for Ivanka to get the full security clearance she needs to be an adviser to the president.

I want to bring in CNN crime and justice reporter Shimon Prokupecz.

Shimon, walk us through what you know.

SHIMON PROKUPECZ, CNN CRIME AND JUSTICE CORRESPONDENT: Well, Brianna, much like Jared Kushner, her husband, there are some concerns over Ivanka Trump's overseas contacts, specifically with this one particular business deal, which was the Trump Vancouver Tower.

It was a hotel, an apartment property that opened in February 2017, just after the election, just after president was in the White House. And ever since then, the FBI has been going over some of her meetings, some of the people that she's been talking to for that deal, some of the financial arrangements. And there has been some concern.

We don't know exactly what that concern is, but certainly a concern has been raised by the counterintelligence investigators and analysts at the FBI, who have been poring over her security clearance and the background check and have noticed something.

And this has certainly concerned them and has caused some hurdles for her in getting her the clearance. And much like her husband, Jared Kushner, they both at this point do not have top-secret security clearance.

And I want to read a statement to you from her attorney where basically he says that she's done nothing wrong. And it says, "CNN is wrong that any hurdle, obstacle, concern, red flag or problem has been raised with respect to Ms. Trump or her clearance application," according to her -- spokesman for her attorney, and says that "Nothing in the new White House policy has changed Ms. Trump's ability to do the same work she has been doing since she joined the administration."

So, it's also important here, Brianna, to note that Ivanka Trump is not the target of any investigation or is going to likely face any troubles as far as we know because of this.

[15:15:08]

But, nonetheless, this is just a continued pattern and a continued concern for FBI counterintelligence investigators.

KEILAR: All right, Shimon Prokupecz, thank you so much.

First, it was Jared Kushner's security clearance being downgraded. Now it's Ivanka's turn with this FBI probe.

I want to discuss with Kim Wehle, a former assistant U.S. attorney and a former associate independent counsel on the Whitewater investigation, Josh Rogin with us as well. He's a CNN political analyst and a "Washington Post" columnist.

OK, you heard about this Vancouver deal and how it pertains to Ivanka Trump and also her role in the White House. As a former federal prosecutor, what would the questions be that you would have about this?

KIM WEHLE, FORMER ASSOCIATE INDEPENDENT COUNSEL: Well, I think in this contacts, we're seeing a lot of norms, rules that have been broken by this administration from the day they walked in, things that they just took the position, this doesn't apply to me.

And what we're seeing is that the rules are there not only to protect the integrity of the process and to make sure that people are secure in their jobs -- that is, they cannot be manipulated and bribed, so to speak, for the information, the access they have -- but it's also there to protect the president and the White House itself.

That is, if we follow these norms and rules that were developed over many, many decades, we don't have this unnecessary drama. So, I do think, to the extent to which there's a question or even a scent of a quid pro quo, access for exchange for some kind of deal, that's a big problem. And I think prosecutors would care about that.

KEILAR: And with Jared Kushner, it's really problematic, because he had meetings with people in the White House, and then right after those meetings his family business gets big loans, loans that are larger than even these -- this management company would normally give out.

So, you look at that, Josh, you look what's going on with Ivanka, how much of a liability is it for them that they have this drama around them?

JOSH ROGIN, CNN POLITICAL ANALYST: Well, there's no question that the knives are out for the Jarvanka inside the White House.

KEILAR: Is it Jarvanka?

ROGIN: Yes.

(CROSSTALK)

KEILAR: Because I thought it was Javanka.

ROGIN: It depends who you talk to. Either one can work.

KEILAR: OK. All right.

ROGIN: But what we saw is that this group -- and the White House is all about factional battles -- was doing pretty well for a pretty long time.

And now they're getting a lot of stories leaked about them. It's not a coincidence. They're vulnerable. They have lost some friends inside the White House recently. Their top two spokespeople just left the White House.

So we have to sort of understand why this is happening. And it's because in this environment, a lot of these stories are meant to sort of create a vulnerability that hopefully Trump will respond to in one faction's effort to push out the other faction.

Will that be enough? I don't think so. OK? They have a trump card, if you will. They're related to the president of the United States.

KEILAR: You don't see this discussion of maybe there's an off-ramp where they work on the reelect and even leave Washington, you don't see that as a real thing?

ROGIN: No, I'm sure that's what one faction is pushing. I just don't think the president has made that decision.

And until the president makes a decision, nothing is really real. We saw stories about John Kelly leaving the White House only three weeks ago. That's not happening. Last week, it was, oh, H.R. McMaster is about to leave. We will wait to see if President Trump actually makes that decision.

What we're seeing is that these internal battles spill out into the public in a very ugly way. And it's just Jared and Ivanka's turn. That's not to say that they didn't commit some impropriety. I definitely feel that they failed in avoiding the appearance of impropriety, which is their role of a public servant to avoid doing, but don't count them out just yet.

KEILAR: Kim, in a recent interview, Ivanka Trump said she had not been interviewed by the special counsel. Now, we know this is ongoing. It doesn't mean she's not going to be.

But did that surprise you? Do you expect that she will?

WEHLE: Yes, I would expect she will. She has been involved in a lot of decisions by the president both leading up to the election, the campaign. But one thing I do remember from being inside the Whitewater

investigation is the massive disconnect between what was actually happening in the investigation and what's publicly reported. So, it's very difficult. It's kind of like reading "War and Peace" every 20th page.

(CROSSTALK)

KEILAR: She said that recently.

WEHLE: Right.

(CROSSTALK)

KEILAR: So, I think we -- so, we would probably take her at her word for that.

Now, when she does do -- and also, I want to note, we're keeping our eye on some live pictures coming to us from West Palm Beach, Florida. The president is arriving in Florida. He's going to be spending the weekend at Mar-a-Lago.

So, that's what we're keeping an eye on right now.

When it gets to that point, Kim, where Ivanka is being interviewed by the special counsel, what does that signal to you?

WEHLE: Well, it signals, I think, that the Mueller investigation is getting closer and closer to the president.

And I think the fact that Jared Kushner's security clearance was downgraded demonstrates that there's some vulnerability there. And the other thing we need to keep in mind is the fact that this investigation is ongoing puts people within the White House in a compromised situation.

[15:20:04]

Any conversation they have with this president about the Russia investigation. And he tends to sort of talk off the cuff. It makes them vulnerable to a grand jury subpoena or another interview.

And, you know, lawyers aren't paid for by these public servants, right? They cost hundreds of dollars an hour in Washington. And it's really, really a difficult, difficult job to do in the best of circumstances. But right now, it doesn't really surprise me that people are leaving.

KEILAR: The drama this week involving Jared and Ivanka, it's just part of this week of chaos, Josh.

As we head into the weekend, we head into next week and we look back on what has been so much turmoil, what's on your mind as you think how this is ultimately going to play out?

ROGIN: There has to be a settling. There has to be a coming to terms between some of these factions where they realize that their infighting, which has now spilled out in such an ugly way, is harming the president, harming the president's agenda. Right?

If they're not working for the White House, they're working against the White House. We see a lot of people just throwing other people under the bus, in front of the press, in order to distract from their own scandals. We see a lot of stories that are meant to sort of create facts on the ground, as much as cover facts on the ground.

They have got to cut it out. They got to settle down. They got to get their act together. The big question is, can this kind of chaos go on? And some people think that, no, it's leading to some sort of climax, where something drastic is going to happen, or we're going to get to a crisis, or some sort of emergency, where that chaos system won't function.

I'm of the view that we might see this chaos in a constant way for a long time.

(CROSSTALK)

KEILAR: Oh, wow. OK.

(CROSSTALK)

ROGIN: Get used to it.

KEILAR: Well, next week will be interesting, then. Josh Rogin, Kim Wehle, thank you so much to both of you.

ROGIN: Any time.

KEILAR: And next, global reaction pouring in to President Trump's trade war threat. One of his informal economic advisers joins us live to debate the merits of raising tariffs on steel and aluminum.

(COMMERCIAL BREAK)

[15:26:25]

KEILAR: More breaking news this hour.

Wall Street fluctuating wildly, as President Trump doubles down on his threat, saying trade wars are good. The Dow shedding more than 100 points at this point, 161 points down, after his sudden decision to slap punishing tariffs on steel and aluminum imports.

The U.S. does have the world's largest trade deficit in the world. You can see the breakdown here. So, we asked our reporters all over the globe to share the reaction from where they are, starting with international correspondent Matt Rivers in Beijing.

(BEGIN VIDEOTAPE)

MATT RIVERS, CNN INTERNATIONAL CORRESPONDENT: China doesn't want a trade war any more than the United States does. Some analysts that we have spoken to have said that China could

actually be more exposed to potential damage in a trade war because the economy is slowing down here.

And the economy relies on continued exports to the United States to make sure that there won't be a hard landing in the future. So, because of that, a lot of voices that CNN has spoken to today here in China predict that China won't overreact to this proposed set of tariffs, especially when you consider that China doesn't actually export that much steel and aluminum to the U.S., when you compare it to other products.

All that said, though, China continues to say it will protect its interest and retaliate when necessary.

ATIKA SHUBERT, CNN CORRESPONDENT: I'm Atika Shubert in Berlin, where there has been a very angry response to the possibility of tariffs.

The Steel Federation here is saying it's a clear violation of WTO rules. And the foreign minister saying it's -- quote -- "incomprehensible."

Now, Germany produces about 3 percent of steel going to the U.S. It is the largest steel producer in the E.U. And the view from Berlin is that Germany and the E.U. is being unfairly punished with these tariffs, to the benefit of China. And if these tariffs are imposed, Europe may have to put up its own protective barriers.

PAULA NEWTON, CNN INTERNATIONAL SECURITY CORRESPONDENT: I'm Paula Newton in Ottawa.

When President Trump talks about those tariffs on steel and aluminum, he has to be talking about Canada. Canada exports more steel and aluminum to the United States than any other country. Here, they are arguing they should have exemptions. They are part of the military security infrastructure. That's part of American law. And for that reason, they should be exempt.

They had some assurances that they were likely to be exempt, all of that coming from the president himself to Prime Minister Justin Trudeau. And yet now Canada is preparing for the worst, hearing now that the president has changed his mind and there will no exemptions on the table.

Now, Canada is preparing its own list of retaliations, Justin Trudeau saying to President Trump, look, a trade war will hurt the United States just as much as it will hurt Canada -- back to you.

(END VIDEOTAPE)

KEILAR: All right, let's talk about all of this.

Joining me now is Stephen Moore, former Trump economic adviser, now CNN senior economic analyst, and financial analyst Alexis Goldstein.

I want to take a look at how Commerce Secretary Wilbur Ross is defending the new steel and aluminum tariff plan.

Let's watch.

(BEGIN VIDEO CLIP)

WILBUR ROSS, U.S. COMMERCE SECRETARY: In the can of Campbell's Soup, there's about 2.6 cents, 2.6 pennies' worth of steel.

If that goes up by 25 percent, that's about six-tenths of 1 cent on the price of a can of Campbell's Soup. So, who in the world is going to be too bothered by six-tenths of a cent?

(END VIDEO CLIP)

KEILAR: All right, Alexis, you first.

What's your reaction to the commerce secretary's defense there?

ALEXIS GOLDSTEIN, AMERICANS FOR FINANCIAL REFORM: Well, I think it's probably always a bad idea to send a billionaire, as Wilbur Ross is, out to talk about, hey, it's not a big deal if prices go up. That's just not great P.R.

But I do think that, look, the United States is within its rights to enforce existing trade rules.