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Cohen: My First Loyalty Is To Family And Country, Not Trump; Trump White House Drafts Bill To Abandon Key WTO Rules; Friday Deadline For U.S. Tariffs On Chinese Imports; U.S. Intel: North Korea Has No Intention Of Full Denuclearization. Aired 11-11:30a ET

Aired July 2, 2018 - 11:00   ET

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


[11:00:00]

KATE BOLDUAN, CNN ANCHOR: Hello, everyone. I'm Kate Bolduan. Breaking his silence and creating some distance, Michael Cohen, Donald Trump's personal attorney, who once declared he would take a bullet for Donald Trump now is suggesting something very different.

Cohen telling ABC News this morning this, "My wife, my daughter and my son have my first loyalty and always will. I put my family and country first." Does that mean Michael Cohen is ready to cooperate with federal prosecutors?

Why is he speaking out now? What does that mean for Robert Mueller's investigation? What does that mean for Donald Trump? So many questions, right?

CNN National Political Reporter, M.J. Lee is here to give us some answers maybe on all of it. First off, that wasn't all Michael Cohen was saying. What else is he saying?

M.J. LEE, CNN NATIONAL POLITICS REPORTER: That's right. Well, Michael Cohen is now saying that he will not put Donald Trump before his own family and not only that, he is also taking a noticeably defensive tone.

He told ABC, "I will not be a punching bag as a part of anyone's defense strategy. I am not a villain of the story and I will not allow others to try to depict me that way."

Now this is striking given the fact that up until now Cohen has been laying low and not saying a lot about the criminal investigation. Now he seems to be going out of his way to say I'm going to put up a fight.

What was also interesting from this ABC interview is that Cohen distanced himself from Trump on a number of fronts. For one, he disagreed with Trump on the FBI raid of Cohen's hotel room, home and office.

You will recall Trump was very critical of that raid back when it happened. But Cohen is now saying, I don't agree with those who demonize or vilify the FBI. I respect the FBI as an institution as well as their agents." Cohen also said something telling about Robert Mueller's Russia investigation which, of course, Trump has repeatedly called a witch- hunt. Cohen simply said, I don't like the term witch-hunt.

So, maybe he is trying to send a message to Trump or the public. But the message seems clear, Kate, that Cohen is not necessarily going to stay on Donald Trump's team.

BOLDUAN: There's a lot to work with there. This also on the Stormy Daniels case, he was asked about it. Michael Cohen has had a lot to say about the kind of the Stormy Daniels payment, his role in it up to this point. A very different -- that's why it was so surprising what he said this morning.

LEE: That's right. Actually, quite telling what Michael Cohen would not say about the Stormy Daniels case in this interview. This is going back to the $130,000 payment that Cohen made to the adult film star. This was part of the hush agreement to keep Daniels quiet about her alleged affair with Trump in 2006.

He was asked if Trump directed him to make the payment or promised Cohen that he would reimburse him. Take a look at how Cohen responded. He said, I want to answer, one day I will answer, but for now I can't comment further on advice of my counsel."

Now this is very different from in the past when Cohen said that he acted on his own, that this was one of the many things he did in his capacity as Donald Trump's fixer and that Trump didn't know about the payment.

So, the fact that Cohen is now not willing to answer this question seems to be a significant shift in strategy -- Kate.

BOLDUAN: We shall see. Thank you so much, M.J. I really appreciate it laying out for us.

Joining me right now to discuss this and more, Jamil Jaffer, former associate White House counsel for President George W. Bush, and also CNN Senior Political Analyst, Mark Preston. Great to see both of you. Jamil, first to you, what do you make of Cohen's answers here?

JAMIL JAFFER, LAW PROFESSOR, GEORGE MASON UNIVERSITY: Well, look, I mean, obviously, Michael Cohen, concerned that he is going to come under indictment and telegraphing to the world and to Donald Trump and to the prosecutors that he is ready to make a deal.

He is willing to talk to them about what he knows and that he will put his family and his country first, which essentially means to me, he is not going to put Donald Trump first. If he needs to make a deal to protect himself and his family, he is ready to do that now.

BOLDUAN: Mark, M.J.'s reporting that Cohen's friends have been pushing him to kind of get out there and tell his story more, do you think this is another case of an audience of one or is this more than that? MARK PRESTON, CNN SENIOR POLITICAL ANALYST: Well, I think Jamil is right. I do think it's an audience of one and that it's a singular message that's being delivered, but there are multiple ears that are listening to it.

You know, just looking at what he said and how he tried to distance himself from the president as M.J. just laid out there would lead you to believe that that message that he is sending is not only to the prosecutors in the southern district of New York but perhaps down to the Mueller investigators down in Washington, D.C.

Now, of course, they are sharing information and they talk every day and what have you. But still, this is a very big splashy way to say to the folks who are investigating the Russia collusion or perhaps could there have been collusion, this is quite a way to send the message.

BOLDUAN: So, Jamil, if you are Donald Trump's legal team watching this today, what do you do with it?

JAFFER: Takeaway his Blackberry and don't let him tweet. I mean, we can all sort of feel it coming --

BOLDUAN: Are you still working on a Blackberry? That's a very important conversation. I'm kidding.

[11:05:04] JAFFER: You know, his iPhone, whatever that he uses to tweet, take it away, because we can all feel the heat building. That responsive tweet is coming any minute now. We have seen it before. We have seen it with Mike Flynn, Paul Manafort. We've seen it with other folks.

It's coming and when it comes, you know, it's hard to know how it would play out. I would tell the president, don't talk about it. Don't respond. He will do what he will do. We should do what we need to do to protect ourselves.

BOLDUAN: Can we drill down on the Stormy Daniels, Jamil, on what he is saying about Stormy Daniels, that whole case. He's previously said he did it on his own with his own money. Now he is basically -- I want to answer that question, one day I will, right now I can't. Is that changing his tune or is he just not talking about it?

JAFFER: Well, he is just not talking about it. It feels like it might be a change in tune because there's no reason to not talk about it if you are going to say the same thing. Of course, the whole problem is that the whole Stormy Daniels thing doesn't make any sense.

The president didn't know. He didn't tell him to do it. He decided to go and take out a home loan. It seems crazy. And then, of course, later on, the president did say he reimbursed him through -- it was unclear through payments that were part of his retainer.

None of this is clear. What's clear now is that he has something else to say. We don't know what it is. I think the assumption people are making is the right one. We will see going forward. BOLDUAN: Mark, when Cohen told George Stephanopoulos that he didn't like the term witch hunt, that really stuck out to me only in the regard is, why do you think that he went there? He could have gotten his same message out that he puts his family and country first, he could have got that out without directly contradicting the president's most consistent attack on Robert Mueller don't you think?

PRESTON: No question, but he certainly handed that olive branch very delicately to the prosecutors. You know, he does not agree with the idea of the term witch-hunt we heard Donald Trump talking about. He talked about how the FBI agents that went in and raided his home and his office were very respectful. Just by hearing his tone and his words, you have to be led to believe that he is willing to make a deal and perhaps that deal could be something that is substantial.

BOLDUAN: So, if that's true -- that's kind of a great place of where we are at this moment, Mark -- So, Jamil, does him speaking out now change anything for SDNY?

JAFFER: Well, it's a great question. I think the thing that's hard about this is, you know, he -- the conversations he had with Donald Trump, depending on whether he was acting as Trump's attorney or not, may be attorney/client privilege. He can't waive that without his client's permission.

So, he may have something to say, but it's not clear how much on what he will be able to say and whether that will be enough for the SDNY prosecutors to make them willing to do a deal.

So, it all depends on what they have on him. We haven't seen any charges yet. But it all turns on what they have, what they think they can get on him and what he is willing to give up in exchange for that. It will be interesting thing to see how it plays out over the next few weeks and months.

BOLDUAN: Jamil, he is bringing on a new attorney, a week or two ago. This would be an attorney that is not in a legal pact with or linked in a legal sense to Donald Trump's legal team, which his previous team has been. What could that mean?

JAFFER: Look, typically, people come out of joint defense agreements, which is what you are talking about, when they are looking to signal to prosecutors they are ready to make a deal, have that conversation.

Now typically, that happens after charges are brought or about to come. He may have a sense charges are coming. If that's the case, this may be a signal, I'm ready to talk about a deal.

BOLDUAN: All right. Jamil, great to see you. Mark, great to see you. Thank you so much.

Let us all wait and see together. Coming up, markets are taking a hit today as U.S. allies unleash new tariffs on everything from orange juice to lawn mowers. So, what does it mean? We will take a look.

Plus, North Korea has no intention to fully eliminate its nuclear program. That is according to at least one U.S. intelligence agency. Was the Singapore summit a failure? Stay with us.

(COMMERCIAL BREAK)

[11:13:11]

BOLDUAN: If a trade war is coming, is this what positioning the troops looks like? Sources tell CNN the White House has drafted a bill that would give the president sweeping power on trade and stunning few restrictions. He could ignore key rules established by the World Trade Organization and single-handedly raise U.S. tariffs.

CNN's Jeremy Diamond is at the White House with much more on this. So, Jeremy, what is the White House saying about this?

JEREMY DIAMOND, CNN WHITE HOUSE REPORTER: Well, Kate, this draft bill that has now been leaked aims to give the president these broad powers on the trade front. More powers than he already currently has. The White House so far is not exactly denying the veracity, the authenticity of this draft bill that has been released.

White House Spokeswoman Lindsey Walters told "Axios," which first broke this story that the president has had frustrations with the unfair trade issues between the U.S. and other countries. The commerce secretary, Wilbur Ross, was also on air this morning, not denying the bill, and again, expressing some of those frustrations.

(BEGIN VIDEO CLIP)

WILBUR ROSS, COMMERCE SECRETARY: There are some reforms needed at the WTO. I think there really is a need to update and synchronize its activities. We will see where that leads. But I think it's a little premature to talk about simply withdrawing from it.

(END VIDEO CLIP)

DIAMOND: And this draft bill wouldn't officially signal the U.S.' exit from the WTO, but it would effectively do so by backing away from some key WTO principles. But on Capitol Hill and across Washington, this is really being received as little more than a White House pipe dream on the trade front.

This is something that would likely be dead on arrival in this current Congress. Both Republicans and Democrats would be critical of giving the president more authority on the trade front.

Keep in mind, even without some of these additional authorities, the president is already opening several fronts on trade issues between the United States, the European Union, Canada, Mexico and, of course, China.

[11:15:07] Later this week, $34 billion of tariffs on Chinese goods that the president has promised are set to go into effect. With that, we're expecting Chinese retaliation of the same amount -- Kate.

BOLDUAN: All right. Jeremy, thanks so much. Really appreciate it. Exactly what Jeremy is talking about, the Dow is down once again this morning. Is this the reason why? Canada just unveiled new retaliatory tariffs on a variety of U.S. products. The European Union is now threatening nearly $300 billion of tariffs on U.S. exports.

CNN's Alison Kosik is at the New York Stock Exchange with more on this. So, Alison, what does this all mean?

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Well, first of all, as we see these trade tensions escalate it could causing economic growth to slow down here in the U.S. and it potentially could mean higher prices for consumers.

Well, now we are seeing other countries hit back at the U.S. Yesterday, Canada slapped retaliatory tariffs on $13 billion in U.S. goods. That includes a 25 percent tax on 40 U.S. steel products and 10 percent tax on items like maple syrup, coffee beans and strawberry jam.

So, what does it is it makes products -- those products more expensive in Canada and can wind up hurting U.S. exporters or U.S. companies. The worst-case scenario is that American companies that sell goods in Canada could be forced to cut jobs or raise prices here in the U.S.

This is just the beginning. President Trump also considering placing tariffs on car imports. The E.U. is warning, if that happens it could strike back with tariffs on $294 billion worth of U.S. goods. This would be a big deal, Kate, because it amounts to about 19 percent of total U.S. exports last year.

Example for you, G.M., which imports some car parts, says tariffs could, quote, "lead to a smaller GM, forcing GM to cut jobs or raise prices by thousands of dollars." Toyota also speaking out saying the tariffs could make the Camry $1,800 more expensive.

So, all of this is sort of culminating to this Friday. This is sort of d day, the day that U.S. tariffs on $34 billion worth of Chinese goods goes into effect in Beijing. Guess what, it's expected to retaliate in equal measure.

And by the way, that's just the first phase of U.S. tariffs on China. Another $16 billion is right under review right now. So, that's why you are seeing stocks under pressure right now on Wall Street, Kate. Investors are worried a trade war will slow U.S. economic growth and wind up hurting corporate profits -- Kate.

BOLDUAN: All right. Alison, thanks so much.

Joining me right now to discuss this is Max Boot, CNN global affairs analyst and former foreign policy adviser to three Republican presidential campaigns. Great to see you, Max.

MAX BOOT, CNN GLOBAL AFFAIRS ANALYST: Good morning.

BOLDUAN: So, first and foremost, I mean, should anyone be surprised that this president doesn't want to be part of something called the World Trade Organization? BOOT: Well, nobody should be surprised because Donald Trump has made his animosity to free trade clear for decades. But what's striking is just how destructive his policies are being right now. I mean, this clearly caters to his preconceptions, but it's hurting U.S. workers, companies.

It's hurting U.S. farmers who are part of his constituency. So, it doesn't make any sense in terms of U.S. economic or strategic interests. It only makes sense because Donald Trump has had this irrational animus for years against free trade.

BOLDUAN: But Max, I mean, liberal Democrats have issues with the WTO as well. Do you actually see, I mean, rubber meeting the road here in terms of -- Jeremy Diamond called it something of a pipe dream in terms of getting anything through on Capitol Hill. Could this be something that the president really is pushing for? Is this just, I don't know, smart messaging on Donald Trump's part? It's kind of true to form.

BOOT: It could be just a wish on Donald Trump's part that may not be granted by Congress. He has already taken a vast amount of discretionary authority granted to the president and really misused it.

Because remember he used the national security provisions to throw tariffs on goods from the European Union, from Canada, Mexico. These are countries that are not national security threats to the United States. Instead of granting more discretion to the president, Congress should be taking it away.

I mean, this is Republicans on Capitol Hill who profess to be free traders. They're not doing anything. They're not stopping this power grab by Donald Trump. Maybe they won't give him more authority.

But he is already misusing the authority that they have. It's a shame that they are not willing to claw back the power they have granted the presidency in decades past.

BOLDUAN: This is just a draft, right? I mean, some of the reporting is that the draft was leaked out in order to hurt its chances of actually seeing the light of day. It has me thinking that when you are advising presidential candidates, would you draft somewhat unusual policy proposals that clearly weren't going to see the light of day? Is this par for the course and this one leaked out or is this something unusual?

[11:20:09] BOOT: You know, Donald Trump is unlike any other presidential candidate or president that we have ever had. I mean, you know, he has very different ideas. He doesn't operate by kind of established policy making procedures. So, you know, I'm not sure exactly where this came from in the administration.

But this is clearly scratching an itch for him because of his incredible hate towards the WTO, towards NAFTA, towards NATO, towards the entire alliance structure and the free trade structure that U.S. policy makers created in 1940s. I mean, remember that Dean Acheson (ph), who is Harry Truman's secretary of state titled his memoirs, present at the creation. If a member of the Trump administration were to write his memoirs, I think they would have to call it present at the destruction because Donald Trump seems to be bent on one way or another on destroying this post- World War II (inaudible) Americana created by the greatest iteration.

BOLDUAN: That actually gets to the larger kind of conversation of the Trump doctrine right now. I mean, the president is not letting up on his attacks of international alliances. You mentioned his most -- it was NATO is as bad as NAFTA. Now it's the E.U. Just listen to him from the weekend.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES OF AMERICA: The European Union is possibly as bad as China just smaller. OK? It's terrible what they did to us.

(END VIDEO CLIP)

BOLDUAN: So, if this is the Trump doctrine, which is essentially hit U.S. allies and hug U.S. adversaries, do you see any real alignment, though, happening in real time?

BOOT: Well, this is something that Donald Trump can do. I mean, he has vast power as president. It's perverse. I mean, his view of the European Onion as being a threat to the United States is just bonkers. That's the exact reverse of the view held by every U.S. president going back to Harry Truman, who have all encouraged European integration and have seen a Europe united and strong as John F. Kennedy put it as a ball work of containment of Russia and as a great friend and ally of the United States.

Donald Trump has this hatred of the European Union essentially because they sell us stuff that we want to buy. He thinks that Germany is a national security threat because they sell us a lot of cars that Americans want to buy.

This makes no sense. De facto by bashing the European Union, by raising doubts about the future of NATO, de facto, Donald Trump is advancing the Russian foreign policy agenda because this is exactly what Russia wants to see. Russia wants to see destruction of the Atlantic alliance. Donald Trump is seemingly advancing towards that goal. This is not in America's interests. This is in Russia's interest.

BOLDUAN: Do you see that -- do you see a real realignment happening, though? Is this -- I am trying to cut through what Donald Trump is talking about on Twitter versus what is happening kind of in reality.

BOOT: Well, I think you are going to see a real realignment happening, because this -- Donald Trump's Twitter feed is really a window into his inner most thinking. This is -- he acts on it. We have seen that time and again. There's not a disconnect between his Twitter feed and his actions. There's sometimes a time delay between his Twitter feed and his actions, but he is acting on this. I mean, you already saw last month the most acrimonious G7 Summit in history with Donald Trump feuding with our democratic allies.

There's another NATO summit coming up in a couple of weeks' time, which could be just as acrimonious. There could be -- there's a summit with Putin where the Europeans are petrified that he is going to sell them out and recognize the legal Russian annexation of Crimea.

Something that John Bolton refused to rule out yesterday. I mean, this is a series of incremental steps. It's not like he is destroying NATO overnight, but he is chipping away at the foundations of the Atlantic alliance.

And if, you know, he were to last in office eight years, it would be a miracle if the Atlantic alliance in its present form survives the Trump presidency.

BOLDUAN: Well, All right. Max, thank you so much. Appreciate it.

BOOT: Thank you.

BOLDUAN: Coming up, at least one U.S. intelligence agency now says that North Korea has no intention to fully eliminate its nuclear program. Why then is the president saying North Korea is no longer a nuclear threat? That's next.

(COMMERCIAL BREAK)

[11:28:34]

BOLDUAN: We have breaking news this morning. The U.S. Defense Intelligence Agency says North Korea has no intention of giving up its nuclear program right now. That despite President Trump's repeated claims that the threat from North Korea's nuclear weapons is now over.

CNN's Pentagon correspondent, Barbara Starr is joining me right now with more details on this. So, Barbara, make sense of this for me. What is the DIA saying?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, the Defense Intelligence Agency here at the Pentagon, you know, they're well aware of what the president has said. Remember, Mr. Trump has said he would sit down with Kim and know right away what his intentions were and if he was really going to denuclearize.

Well, maybe not so fast. According to DIA and the intelligence they have is that Kim has no intention of doing that, at least not right now. He may well sign some sort of agreement with the U.S.

But the imagery they have, the intelligence they have, the electronic intercepts is indicating that Kim plans for now to try and deceive the U.S., try to hide away his missiles, his warheads. This is what he has done for years. For the DIA, not a big surprise. The White House still very much holding to an optimistic view. Listen to John Bolton and what he had to say over the weekend.

(BEGIN VIDEO CLIP)

JOHN BOLTON, WHITE HOUSE NATIONAL SECURITY ADVISER: We have developed a program, I'm sure that Secretary of State Mike Pompeo will be discussing this with the North Koreans in the near future about really how to dismantle all of their WMD and ballistic missile programs in a year. If they have the strategic decision already made to do that and they're cooperative, we can move very quickly.

(END VIDEO CLIP)