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Trump Controversial Practice; Dow Jumps at Open; Louisiana Flooding and FEMA; U.S. Service Member Killed; Apologizing Over Rio Scandal. Aired 9:30-10a ET
Aired August 23, 2016 - 09:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:30:00] PHIL MATTINGLY, CNN CORRESPONDENT (voice-over): Than a dozen interviews, opens a window into a playbook with striking parallels to his campaign, one driven by a bare-knuckled strategy of strong arm tactics, media leaks and public statements that often ran contrary to the truth.
DONALD TRUMP (R), PRESIDENTIAL NOMINEE: The difference between me and other people is I'll attack back. If I have to attack whatever method is necessary, I will. I will.
MATTINGLY: The review also discovered repeated allegations of Trump's use of one particularly volatile, yet completely legal tactic, greenmailing, the practice of buying a large stake in a venerable company for the sole purpose, forcing its management to buy the stock back to avoid a takeover, at a premium. With companies like Bally and Holiday Corp., Trump used his unique position as the holder of a casino license, which allowed him to target his competitors in New Jersey, and make millions as their management scrambled to stave off a takeover attempt.
Walter Reid, the New Jersey casino commissioner at the time, equated Trump's actions to using, quote, "a casino license as a weapon to weaken or undercut the financial integrity of his rivals." Trump and his lawyers vigorously disputed the greenmail charge, but, Trump, in an unsolicited moment during testimony in front of the commission, took pains to remind the commissioners greenmailing is, quote, "a totally legal practice, however. It's not the name, greenmailer, is not a very pretty word," according to transcripts obtained by CNN.
But a tell-all account from former Trump executive John O'Donnell paints a different picture. In his 1991 book on the billionaire, O'Donnell recounts Trump behind closed doors was making it very clear what he was doing, bashing Bally executives as idiots who caved in. In addition to making money, Trump had another motivation, "I really enjoyed doing it because its put a real scare into them," Trump said, according to O'Donnell.
With Bally and Holiday, Trump never went so far as to make a tender offer for the companies, leading critics to believe he'd attacked purely to juice the stock, then sell for profit.
CARL ZEITZ, FORMER NJ CASINO CONTROL COMMISSION MEMBER: I don't think that he intended to acquire another casino or hotel. MATTINGLY: Carl Zeitz, a democrat who supports Hillary Clinton, served alongside Reid on the New Jersey Casino Commission and raised major concern about whether Trump's greenmailing practice made him unfit to keep his state gaming license.
ZEITZ: In those days the term was greenmail, where you went into a public corporation that was vulnerable and you bought stock and you kind of held it up. I think that was his purpose. We did not regard it as conduct sufficient or at a level to say, you're no longer qualified. But we did -- we took it seriously. We didn't like it. And we hoped that by doing that, we put a stop to that kind of business.
MATTINGLY: Trump kept his casino license, but the companies themselves never recovered. Holiday Corp.'s management, bogged down by the debt it took on to ward off Trump, soon had to sell off valued business lines. Thousands lost their jobs. Bally was also left wounded and similarly mired in debt.
As for Trump, despite the millions in profits and the weakened competitors, it wasn't all positive. His efforts sparked a Justice Department investigation in the 1980s, alleging that Trump concocted a scheme to dodge federal stock purchase notifications, something done specifically to hide his intentions from Bally and Holiday. Trump settled the resulting federal lawsuit for $750,000. He did not admit any wrongdoing.
In a separate civil lawsuit brought by Bally shareholders, Trump agreed to pay them $2.25 million for his role in artificially inflating the company's stock. Yet for Trump, one thing has remained clear, then as now, there are no apologies for his tactics.
TRUMP: I love battles. And, unfortunately, battles -- I'm not controversial to be controversial. I mean I get into a lot of battles and that's part of winning.
(END VIDEOTAPE)
CAROL COSTELLO, CNN ANCHOR: That was Phil Mattingly reporting. Trump's campaign has declined CNN's repeated request to make anyone available to walk through Trump's investment strategy.
The opening bell just ringing on Wall Street and things are looking up. And that could be even better news for Clinton, who economists say is the better pick for the economy than Trump.
Alison Kosik is live at the New York Stock Exchange with more on this.
Good morning.
ALISON KOSIK, CNN MONEY BUSINESS CORRESPONDENT: Good morning, Carol.
As far as stocks go, expect some modest moves as investors wait for Fed Chief Janet Yellen to give a speech in Jackson Hole, Wyoming, on Friday. They're looking to see if she gives any clues as to whether the Fed will raise interest rates this year. The annual symposium is often a venue for Fed officials to make headlines. And as you said, something else grabbing the headlines. Economists
think Hillary Clinton would be best for U.S. business. Donald Trump doesn't even come in second. This new survey of more than 400 economists, it shows that 55 percent pick Clinton as their top choice for economic policy. Libertarian candidate Gary Johnson coming in second with 15 percent. Donald Trump follows him with 14 percent. Most of the economist, as the surveyors saying, that Trump's push to restrict trade and immigration are the opposite of what the U.S. should be doing to boost growth. Sixty-one percent say the U.S. needs to allow for more immigration. And 65 percent say the U.S. has to be open to free trade.
[09:35:19] Interesting point here, Carol. There's no consensus on whether the national minimum wage should go up. Only 27 percent support an increase. So that means there seems to be some concern about how raising it could hurt overall economic growth.
Carol.
COSTELLO: All right, Alison Kosik reporting live for us this morning. Thanks so much.
Still to come in the NEWSROOM, devastated flood victims sound off in Louisiana. Many are asking, where's FEMA? Well, I'm going to ask that question to the FEMA administrator, Craig Fugate, as he joins me live after a break.
(COMMERCIAL BREAK)
[09:40:04] COSTELLO: In just about an hour, President Obama will leave the White House for flood ravaged Baton Rouge amid criticism he should have gone there sooner. Mr. Obama's trip will come 11 days after disaster first struck and four days after Republican presidential candidate Donald Trump showed up. The water in Baton Rouge is receding now and it is revealing the damage left behind. You see it there, piles of trash, once people's belongings, lining the streets. But this doesn't tell the whole story. Thirteen people died in the flooding and 60,000 families are dealing with damaged homes. We talked with some of those people and they're not only wondering where President Obama is but where FEMA is.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: You don't see contractors. You don't see FEMA. You see people in pickup trucks pulling out of people's houses.
UNIDENTIFIED MALE: We just hope, you know, that -- we just hope that the government steps up because there's so many people that don't have anything, you know, you know, they need to get -- they need to get help.
UNIDENTIFIED FEMALE: Just waiting on FEMA to try to come and see what they can do for us. We went to my house today and can't salvage nothing. Like a microwave.
(END VIDEO CLIP) COSTELLO: So we hear you. So this morning we're going to pose those questions to FEMA Administrator Craig Fugate. He's live in New Orleans this morning.
Welcome, sir.
CRAIG FUGATE, FEMA ADMINISTRATOR: Good morning.
COSTELLO: So I know FEMA is on the ground. How can these people get help?
FUGATE: First thing is, is if we haven't gotten to them, because we're out in the streets and we're in the shelters registering people, is to register with FEMA at 1-800-621-FEMA, go to disasterassistance.gov.
But we are out in the neighborhoods. We're out in the communities. We've been in the shelters and we started last week. We've already issued $100 million. Now that isn't -- we've issued it. There's $100 million that's been placed in people's accounts to begin the mediate recovery, get a place to stay. And those numbers will continue to go up. So this is a very large operation and substantial amounts of money are already getting to people. But because so many people were impacted, in some of these areas, the waters still weren't coming down until this weekend. It's been a challenge to get to some of the families and get to some of the homes that were still flooded.
COSTELLO: Yes, because I would suspect people who have lost everything and don't have anywhere to sleep at the moment, they have -- they might have difficulty getting to where they need to go to alert FEMA that they need help.
FUGATE: That's why we're going to them. That's why many of them have gone to the shelters. We've set up our registration in the shelters so that people aren't having to go to us, we're going to them. But, again, this is over -- you know, there are a number of parishes involved. In some of these areas, it's just getting to people and getting them -- when they're there so we can get them registered.
COSTELLO: How many people do you have on the ground right now, sir?
FUGATE: Over 2,000 and that number is growing. In fact, some of our first AMERICORPS teams arrived this weekend to start assisting people and mucking out their homes. That's about 400 AMERICORPS to do nothing but supporting people cleaning out their homes and getting their homes back to where they can get back in them.
COSTELLO: So you have these 2,000 people on the ground. You've served over -- more than 100,000 people so far. Yet the local paper and neighbors keep telling us that they still need help and I'll just give you an example of that. The local paper's editorial headline this morning, it says, "welcome, Mr. President, Louisiana needs you." On Friday it read, "we deserve more from Obama, not a sequel to Bush's neglect." That's pretty harsh criticism, Craig. Can you address that?
FUGATE: Well, let's put it this way, I don't think it's deserved, but I understand people are frustrated. I've been with Mr. -- I've been with President Obama on numerous disaster responses. And one thing he's been very clear to me is, Craig, I'll go, but I don't want to get in the response. I don't want to pull resources away from it. And if you look at this response, this was not about a storm that hit and was over, like a tornado or a hurricane. This was ongoing flooding, ongoing rescues. Governor Edwards, the emergency operations center, was all focused on response activities until we got to the weekend, and then those responders, many of whom lost their homes, hadn't had a break yet. So we were very sensitive working with Governor Edwards and Governor Edwards worked with the president on the appropriate time. But the president has been engaged since last Saturday. Sunday he declared a disaster for the state. And in many cases, we were working to get resources in here based upon what we saw were impacts, not waiting for assessments. I've been down here. --
COSTELLO: I think --
FUGATE: Governor -- the secretary of Homeland Security, Jeh Johnson, has been down here. So it isn't that the president hasn't been engaged, it's just, he doesn't want to come in when there are still response activities and disrupt that with his visit.
COSTELLO: I think the optics were bad. He was -- he was on vacation. There were pictures of him playing golf with celebrities. And that upset a great many people.
FUGATE: Again, when you get flooded out and lose everything, there's a lot of frustration and sometimes you're going to vent. But it isn't about what the president hasn't been doing, it's about what we've been doing as an administration working with the governor's team and also the governor and the president working on when it was a good time to come not to disrupt the response operations.
COSTELLO: All right, Craig Fugate, thank you so much. I appreciate your being with me this morning.
Still to come --
FUGATE: Thank you.
COSTELLO: You're welcome.
[09:45:01] Still to come in the NEWSROOM, an American troop killed in Afghanistan while on patrol. Details on what went wrong, next.
(COMMERCIAL BREAK)
COSTELLO: A U.S. service member has been killed in Afghanistan and we're getting new details about what happened. CNN's Barbara Starr live at the Pentagon with more.
Good morning.
BARBARA STARR, CNN PENTAGON CORRESPONDENT: Good morning, Carol.
The most terrible news, of course, for a U.S. military family. The Pentagon announcing a short time ago this service member was killed in southern Afghanistan, in a place called Helmand province. This is an area where the Taliban has been resurgent and there are more than 500 U.S. troops down there.
[09:50:12] This service member was killed when he was on a walking patrol and they triggered an IED explosion. The troops down there have been working to try and train and advise Afghan forces to deal with the Taliban there.
Some of the other details that we're learning, six additional Afghan service members wounded, another American wounded. And, of course, they're looking into all of this. They don't think that the Taliban really had planned to attack this patrol. It was more that they were out there and they triggered this IED explosion. Still, it does underscore a long way to go in Afghanistan. President Obama, of course, making that decision to keep a significant number of troops there for a longer period of time, specifically to try and help train these Afghan forces in places like Helmand province where the Taliban had been resurgent.
Carol.
COSTELLO: All right, Barbara Starr reporting live from the Pentagon, thank you.
STARR: Sure.
COSTELLO: Checking some other top stories for you at 51 minutes past.
We're learning more about the gator attack that killed two year -- that killed a two-year-old at the Disney World Resort last June. A new report says two guests warned Disney employees about the alligator near the beach right before the attack. The report also says Lane Graves' father tried to pry the gator's jaws open after it grabbed his son's head. Florida wildlife authorities say they are confident they caught and killed the gator that attacked the boy, but, still, they can't be absolutely certain.
Stanford University announcing a new policy, no hard liquor or shots at campus parties open to undergrads. The new rules come months after the Brock Turner case made headlines. The Stanford student was convicted of sexually assaulting an unconscious woman outside of a fraternity. Turner blamed his actions on Stanford's party culture. A school spokesperson said the policy update was not related to the Turner case, however.
A man in Pittsburgh tries to impress his date an ends up needing to be rescued. Pittsburgh Police say he tried to jump between two buildings and ended up stuck between the buildings. Crews worked for hours overnight to free him. They ended up having to tear down a wall and pull him through it. After four hours, he was rescued with only an injured ankle. I don't know what happened with the lady.
It is a familiar story with a twist ending. Minor leaguer Brandon Thomas hits a grand slam. Awesome, right? The ball clears the fence and then it hits a car in the parking lot. It was almost a perfect day for Thomas and then he walked out to that same parking lot and saw it was his own windshield that he smashed with his home run ball.
(BEGIN VIDEO CLIP)
BRANDON THOMAS, GATEWAY GRIZZLIES OUTFIELDER: It wasn't a little crack like down here. You know, that's pretty -- some pretty good damage. So at least -- at least I know I hit it pretty good.
(END VIDEO CLIP)
COSTELLO: Thomas says even with the windshield repair bill, the grand slam was well worth it. Awesome.
Still to come in the NEWSROOM, some Americans seem to think Ryan Lochte wins gold for most embarrassing Olympian. Up next, Jeanne Moos on saying "sorry" for the swimmer's bad behavior.
(COMMERCIAL BREAK)
[09:57:30] COSTELLO: U.S. swimmer Ryan Lochte says he takes full responsibility for the Rio scandal, but some Americans seem to be taking his behavior to heart. And the Internet is taking it to -- well, to the next level. Here's more now from Jeanne Moos.
(BEGIN VIDEOTAPE)
JEANNE MOOS, CNN CORRESPONDENT (voice-over): "The Sorry Refrain" --
JUSTIN BIEBER (singing): Sorry --
MOOS: Sung by everyone from Justin Bieber to Brenda Lee.
BRENDA LEE (singing): I'm sorry --
MOOS: And look who's sorry now. Not just swimmer Ryan Lochte.
AL ROKER: He lied. He lied to you.
UNIDENTIFIED FEMALE: Yes.
ROKER: He lied to Matt Lauer.
MOOS: But when travelers departing the Olympics were asked to leave a special message to Rio at the airport, "sorry about Ryan Lochte" was one of the more popular ones scrolled on the board. Apparently embarrassed Americans felt the need to apologize.
MOOS (on camera): But you know who said "sorry" even more times than the message board?
MOOS (voice-over): Lochte himself.
RYAN LOCHTE: I'm just really sorry about -- I'm embarrassed. I'm just really sorry. How sorry I am. I am really sorry. I'm just really sorry. How truly sorry I am.
MOOS: He' paying a stiff price for saying he and his teammates were robbed and he had a cocked gun held to his head.
"Do you lie a little of a Lochte?" was one meme. On John Oliver's "Last Week Tonight," they said farewell to him.
UNIDENTIFIED MALE (voice-over): Ryan Lochte, America's idiot sea cow.
LOCHTE: What defines me? Ryan Lochte.
MOOS: Now he's being stripped of his endorsement deal.
LOCHTE: I am Speedo Fit.
MOOS (on camera): Not anymore. On Monday, Speedo dropped Lochte.
MOOS (voice-over): Tweeted one columnist, "ironic to lose a Speedo endorsement over an inadequate cover-up." A mattress company dumped him. Even his gentle laser hair removal sponsor cut off Lochte. Ralph Lauren refused to renew his contract.
LOCHTE: I could be having the worst day of my life. But as soon as I step foot in that water, everything just disappears.
MOOS: Better dive, Ryan, and make that one worst day of admitted intoxication disappear.
LEE (singing): I was too blind --
MOOS: Drunk --
LEE (singing): To see.
MOOS: Jeanne Moos --
LOCHTE: I over exaggerated.
MOOS: CNN.
LOCHTE: I over exaggerate that story.
MOOS: New York.
(END VIDEOTAPE)
COSTELLO: The next hour of CNN NEWSROOM starts now.
And good morning. I'm Carol Costello. Thank you so much for joining me.
[09:59:57] The Clinton Foundation is coming under increasing scrutiny in the 2016 campaign as Hillary and Bill Clinton face sharp criticism from their Republican rivals. Among them, of course, Donald Trump, who is postponing a high-profile immigration speech this week.
