Return to Transcripts main page

CNN Newsroom

Trump Defends His Taxes as 'Brilliant'; Pence and Kaine Debate Tonight on CNN; Gary Johnson Offers New Explanation for Gaffe. Aired 3:30-4p ET

Aired October 04, 2016 - 15:30   ET

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

[15:30:00] BROOKE BALDWIN, CNN ANCHOR: Welcome back to Farmville, Virginia. I'm Brooke Baldwin. You are watching CNN. We're thrilled to be here. A couple hours away, you hear the students behind me. They're happy we're here, I hope, ahead of this vice presidential debate at Longwood University. Donald Trump is defending revelations about his possible tax avoidance touting it as proof of his business acumen.

At a rally in Colorado on the heels of the report from the "New York Times" over the weekend that indicated Mr. Trump lost nearly a billion dollars back in 1995, a loss that could have allowed him to legally avoid paying federal income taxes for the next 18 years, Trump spoke about it, confronted the issue head on, here he was.

(BEGIN VIDEO CLIP)

DONALD TRUMP. REPUBLICAN PRESIDENTIAL CANDIDATE: I have legally used the tax laws to my benefit and to the benefit of my company, my investors and my employees. I mean, honestly? I have brilliantly used those laws.

(END VIDEO CLIP)

BALDWIN: With me now is Congressman Jeb Hensarling, a congressman from Texas, Donald Trump surrogate, chair of the house financial services committee. Nice to have you here.

JEB HENSARLING, CONGRESSMAN, TEXAS: Thanks for having me.

BALDWIN: First of all, you just met with one half of this debate tonight, you met with Mike Pence in Richmond a couple hours ago, what can you share about the meeting? How do you feel?

HENSARLING: Well, he's tan, rested and ready.

BALDWIN: Tan, rested and ready. What does that mean?

HENSARLING: It means he's ready for tonight, he knows what he needs to do. He needs to tell the American people if you're not satisfied with the status quo, if you're not satisfied with this economy, if you don't think you go to bed in an America where your children and grandchildren are safer, there's an agent of change it's Pence and he can do that, I've known him for years, he is the right man for the job and I have to tell you, I didn't know Donald Trump but once he picked Mike Pence I knew he was my man, too.

BALDWIN: You told me before we were live, this is something Mike Pence has been preparing for as long as he's known, doing his homework, readying himself for his debate before the Hofstra University presidential debate, it was known Donald Trump didn't do mock debates, he said he wanted to appear authentic and by all why do you think Mike Pence has chosen to go a different reparation route?

HENSARLING: Mike in many respects has been preparing for this for quite some time. He was a leader in congress against his own leadership. He helped lead the fight against earmarks and wasteful Washington spending.

BALDWIN: Why did he decide to do his homework?

HENSARLING: Well, he's done his homework before but he knows he's been in many debates before, this is not his first rodeo as we say in Texas. This is something he needed to prepare for and he did. I think America will be in for a real treat tonight.

BALDWIN: Just looking ahead to this weekend and the town hall in St. Louis that Donald Trump will have learned his lesson and Donald Trump will have done his homework?

HENSARLING: Certainly hope so. It wasn't necessarily his best outing but I remember Barack Obama didn't have a particularly good first debate against Romney and seemed to bounce right back. So there's a number of these and I think, you know, America will be pleased at Donald Trump's choice.

They make a pair. He didn't pick somebody who was a clone of himself when he picked Mike Pence, he picked a partner who also wants to change Washington but also knows how Washington works and how you can be the agent of change that Donald Trump represents, and Hillary Clinton, again, if people are satisfied with the status quo, they'll choose her.

But I believe that most of America is not satisfied with business as usual, with a system where Washington insiders play by one rule, the rest of us play by some other set of rules, an economy that's slipping.

BALDWIN: On the rules and on this "New York Times" report on Trump and near billion-dollar loss reported 1995. On his taxes, do you agree with Chris Christie and Rudy Giuliani in saying that he's a genius?

HENSARLING: Well, what I do know is he apparently followed the law.

BALDWIN: Yes or no.

HENSARLING: Something the Clintons --

BALDWIN: Yes or no.

HENSARLING: I assume he followed the law, that's the most important thing. I know he is committed to changing our tax code. He's put out the most fundamental tax reform plan we've seen since Ronald Reagan and we know in the Reagan era we had one of the longest periods of economic growth that benefited all Americans.

It took people out of poverty and made middle income people with making the tax code fairer, flatter, and simpler and so people care more about their taxes than they do about Donald Trump's taxes, he has the plan to reform that and grow America.

BALDWIN: As chair of the financial services committee, you know a thing or two about pennies, nickels and dimes and when you think a billion dollars in '95 could be like a hundred billion now. Let's put the tax avoidance, the legality of it, to the side. What does that say about his business acumen? Of money? That's something that is concerning to all Americans.

HENSARLING: Some people can lose money in one year, make money in the next year, I learned more from my failures --

BALDWIN: One billion dollars.

HENSARLING: I don't think I'll lose that much but I've learned more from my failures and he's learned something, too, but at least he's done something with it he built a company, he's employed tens of thousands of people. I'm not sure Hillary Clinton has ever created one job. I don't know, maybe she created a few jobs of the people who deleted her e-mails many have pleaded the fifth.

BALDWIN: Which is something Tim Kaine will have to talk about. Let's talk about Wells Fargo and those accounts they created and the people they duped and you took those executives to task recently. Let's listen.

(BEGIN VIDEO CLIP)

HENSARLING: This sordid affair does remind me why I trust markets and I do not trust individual companies. Mr. Stumpf, I regrettably have a mortgage with your bank. I wish I didn't. If I was in the position to pay because you have broken my trust and you have broken the trust of millions of people and it will be a long, long time to earn that trust back.

[15:35:00] (END VIDEO CLIP)

BALDWIN: Let me ask you what's on the minds of many Americans in this day and age, especially after the big banks and the failure. How is it that these folks who made that sort of move aren't going to jail?

HENSARLING: It's an excellent question and we have to hold both Washington accountable and Wall Street accountable, so we obviously had Wall Street in to hold accountable. But there's also questions, why if have we had federal regulators embedded in the bank, have been conducting the exams for 18 months to two years?

Why did it taken a "L.A. Times" reporter to break this in the first place? It's one of the reasons house Republicans are working on something called the financial choice act that actually increases fines and penalties for fraud and deceptive acts like the ones that were committed at Wells Fargo. It goes further and makes sure they can never qualify for a bailout. Unfortunately, Hillary Clinton supports a bailout for Wells Fargo and that's wrong.

BALDWIN: You were against the bailout.

HENSARLING: I absolutely was. I helped lead the charge against it.

BALDWIN: If the banks were to fail again and they would need bailing out, do you know, would Donald Trump support that?

HENSARLING: Well, I don't believe so, Donald Trump has said he wants to get rid of Dodd-Frank. Dodd-Frank is what has codified too big to fail into law. It's legislation that provides for a taxpayer funded bailout. Have we not learned anything?

Let's remember, the root cause of the financial crisis was government policy that essentially cajoled and incented banks to loan money to people to buy homes they could not afford to keep, so we started out with bad policy. Listen, Wall Street is more than happy to profit off of it but we start off with bad public policy trying to put people into homes they couldn't afford to keep. An ounce of prevention is worth a pound of cure so investors and lenders need to suffer the full losses, let them monitor their own risks. If you think you'll get a bailout, you won't pay attention to your investment and that's the problem. Donald Trump will make sure that doesn't happen.

BALDWIN: Thank you so much. Did you offer advice to Mike Pence before you left him?

HENSARLING: I told him whatever he does, don't mess it up.

BALDWIN: Congressman Jeb Hensarling, thank you so much from the great state of Texas.

Up next, Donald Trump calls the protest over fatal police shootings, race riots even though, he was told not use that controversial term. We'll debate it with supporters of both Donald Trump and Hillary Clinton minutes away.

[15:40:00] (COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

MICHELE OBAMA, FIRST LADY: We need someone who is honest and plays by the rules because not paying taxes for years and years while the rest of us pay our fair share. see, that does not make you smarter than the rest of us. We need a president who will choose to do what's best for the country even when it doesn't personally benefit them.

(END VIDEO CLIP)

BALDWIN: That was the First Lady just moments ago on the campaign trail for Hillary Clinton today in Raleigh, North Carolina. North Carolina a battleground state where polls show Clinton with a slight lead. Joining us now, George W. Bush's political director, a Donald Trump supporter, Matt Schlapp. Also Bakari Sellers, a former South Carolina house member, a Hillary Clinton supporter and Brianna Keilar is back, our senior political correspondent.

[15:45:00] So let me begin with you. We've seen Michelle Obama and Bill Clinton. All the A team, Hillary Clinton surrogates down to Chelsea Clinton. Bill Clinton.

BRAINNA KEILAR, CNN SENIOR POLITICAL CORRESPONDENT: Chelsea Clinton, Bill Clinton I mean there is a number --

BALDWIN: Why are they rolling them out today?

KEILAR: I mean here in the near future. I think it's a show of force not just about today but about throughout the election.

BALDWIN: Final stretch?

KEILAR: He has -- Chris Christy but he doesn't have Paul Ryan out there stumping for him. He doesn't have some of the bigger Republican names out there stumping for him. They sometimes are keeping their distance from some of his positions.

But Hillary Clinton has Bernie Sanders, Elizabeth warren, Joe Biden, her daughter, her husband and she has that kind of Democratic star power that Donald Trump isn't really able to have. It's a force multiplier for her so it's a good thing and it would be better for Donald Trump if he could get that.

BALDWIN: Let me play one more bit of sound and we'll talk to you fellows about this. This is Michelle Obama at an earlier event poking fun at Donald Trump and his microphone.

(BEGIN VIDEO CLIP)

MICHELE OBAMA: Hillary Clinton is tough. See, I watched her. When she gets knocked down, she doesn't complain. She doesn't cry foul. No, she gets right back up. Comes back stronger for the people who need her most.

(END VIDEO CLIP)

BALDWIN: So is the issue with the debate -- sorry, are you guys trying to tell me something? OK, silence.

SCHLAPP: Is there something wrong with your microphone?

(Laughter)

BALDWIN: Is this thing on? Is this thing on?

KEILAR: It's the ear piece.

BAKARI SELLERS, HILLARY CLINTON SUPPORTER: We just saved her.

BALDWIN: Anyway, I mean what do you think? SELLERS: I think going bac to the list of surrogates that Hillary Clinton has at her disposal, anyone will tell you that Michelle Obama is her best surrogate. Michelle Obama talks to a wide variety of audiences. There's not much to dislike, if anything, about Michelle Obama.

She's very strong but talks directly to women. Female voters, African American female voters we need to make sure turn out in high numbers but also college educated white women. She was campaigning in Raleigh, North Carolina, places where if we look at the latest polls well. I expect over the next 35 days for Donald Trump and his campaign to be pummeled by a long list of surrogates.

BALDWIN: How do you prevent that? To Brianna's point, show of force.

MATT SCHLAPP, DONALD TRUMP SUPPORTER: I'm going to say the same thing. I think Michelle Obama is a great

surrogate. I agree. Having a current president out there is a benefit but you go to what's interesting. I looked at all the big events that the Democratic ticket has done as opposed to Trump and Pence. They've done twice as many events and the attendance either double or three times higher, so there's a strange phenomenon we haven't seen before which is it is very much about Trump and Trump- Pence.

He's running the show drawing huge audiences. These are people that are spontaneously coming to see what's happening and they're not necessarily signed up to support him. Hillary Clinton is running a typical campaign. Good, it's solid. But she needs these surrogates. But can Trump get it done with the way he's running this race which is unorthodox unlike anything we've seen before.

BALDWIN: Stay with me. We have to take a quick break. Up next presidential candidate Gary Johnson on his latest interview today. Have we seen this? Explaining his most recent town hall gaffe when he was unable to name a foreign leader. What he told CNN about that moment next.

[15:50:00] (COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GARY JOHNSON, LIBERTARIAN PRESIDENTIAL CANDIDATE: With regard to Aleppo, look, why can't we admit to, in this case, we're involved in Syria, we're involved in a civil war where hundreds of thousands of innocent people have died, and because we are involved in both sides of this cross-fire, we have to take some responsibility for a lot of those people that have died.

But I guess because you can -- you can dot the I's and cross the T's on foreign leaders and geographic locations, that now somehow you're qualified to put us in that situation? Hey, if that ends up to be the case, so be it. I guess I wasn't meant to be president.

(END VIDEO CLIP) BALDWIN: So, Gary Johnson. This was Gary Johnson talking this morning to Chris Cuomo trying to clean up the gaffe last week about not being able to name a foreign leader. This was just a piece of it this morning. He said something else on another channel.

KEILAR: Now that is cringe-worthy.

BALDWIN: In and of itself.

KEILAR: He also said on another network, sort of in the same vein, he said that knowledge of world geography, basically, the crossing of the I's and the T's, that it quote, allows leaders to put the military in harm's way. He is bringing up whether that -- I mean, that is a qualification, knowing important foreign leaders, foreign countries, how they relate to U.S. foreign policy, right? This is a big world it's not just the U.S. in this world, and clearly there are allies and there are enemies. And it's cringe-worthy that he sort of is belittling that as a qualification. Knowing where countries are doesn't necessarily mean that you're going to put the military in harm's way. You should know where countries are. That's basic.

SCHLAPP: He's trying to put it back on his ground which is, hey, I am not going to be an interventionist. I'm not going to go everywhere with our troops. He's trying to pivot from that but you're right, it is hard to clean up, that was a pretty big faux pass.

BALDWIN: Pre, what is Aleppo this could have been a much different race. But ever since then and ever since with the cleanup --

SCHLAPP: I don't know if I buy that. I don't know. I think it's a big faux pas. It has an impact. I don't think we should minimize it but I do think Gary Johnson will benefit from the fact that a lot of people are looking outside the parties for answers. They definitely are the parties are a little bit under indictment this cycle.

BALDWIN: I don't know but after all of this, quickly.

SELLERS: What we're seeing in the most recent polling, with comments like this and comments like, what is Aleppo? You see Gary Johnson start to hemorrhage his support. In the millennial poll, a lot of his support there is going back to Hillary Clinton, which she needs. Which ties into our earlier segment because that is where the Michelle Obamas and Bernie Sanders and Elizabeth Warrens come in handy. I saw in New Mexico one poll where Gary Johnson was polling over 20 points.

SCHLAPP: Exactly. There actually a case to be made that, if he keeps it up in New Mexico --

SELLERS: Don't scare all the viewers. If he keeps it up in New Mexico there's a possibility we could get to 269-269. Which we do not --

BALDWIN: Clearly, clearly, Bakari, Matt and Brianna, thank you very much. Were in Farmville, Virginia, hours away from the first vice presidential debate. We're back after this. Before I let you go, quick note for those of you keeping score on

twitter. Donald Trump announced he would be live tweeting throughout the vice presidential debate tonight which starts a couple hours from here -- from me here in Farmville, Virginia. Thank you for being with me.

[15:55:00] (COMMERCIAL BREAK)