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Trump Team Pushes Ahead with Cabinet Picks as Trump Begins "Thank You" Tour; Sanders: Trump Deal Endangers U.S. Jobs; Carrier: State "Incentives" Were Key to Staying. Aired 9-9:30a ET

Aired December 01, 2016 - 09:00   ET

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

[09:00:24] CAROL COSTELLO, CNN ANCHOR: And good morning, I'm Carol Costello. Thank you so much for joining me.

President-elect Donald Trump kicks off a victory lap tour today, thanking voters for his stunning upset and reveling in a campaign promise already delivered. Trump will travel to Indianapolis to celebrate a deal that will keep about 1,000 jobs from being moved to Mexico. Trump had targeted Carrier on the campaign trail and vowed to keep American jobs from moving abroad. That pledge fired up voters in the Rust Belt.

And tonight, Trump kicks off his "Thank You" tour in the battleground state that clinched his victory. The first stop, a campaign-style rally in downtown Cincinnati. We're covering all the angles this morning. CNN's Jessica Schneider is live outside of Trump Tower at the transition headquarters, and Suzanne Malveaux is outside the Carrier plant in Indianapolis.

Let's begin with you, Jessica. Hi.

JESSICA SCHNEIDER, CNN CORRESPONDENT: Well, hi, Carol. You said it, today is a return to those rallies that fueled Donald Trump's victory. He'll be setting aside those job meetings and those interviews right here at Trump Tower to go back to those crowds who fueled his improbable run.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): President-elect Donald Trump heading back into campaign mode, embarking on a "Thank You" tour in swing states that won him the White House. Trump will hold a rally in Cincinnati tonight after taking a victory lap in Indiana, celebrating a deal with Carrier to keep at least 1,000 manufacturing jobs from moving to Mexico. Carrier offering limited details on terms of the deal, receiving unspecified incentives from the state run by Trump's V.P. Mike Pence.

This as Trump's cabinet continues to take shape. The search for Secretary of State narrowed down to these four candidates. Close Trump adviser Newt Gingrich hammering Mitt Romney after his high- profile dinner with Trump Tuesday night.

NEWT GINGRICH (R), FORMER HOUSE SPEAKER: You have never, ever in your career seen a serious adult who's wealthy, independent, has been a presidential nominee suck up at the rate that Mitt Romney is sucking up.

SCHNEIDER (voice-over): Trump also facing blistering criticism from the left over his newly appointed economic team. Democratic Senator Elizabeth Warren slamming Trump's pick for Treasury Secretary, former Goldman Sachs executive Steve Mnuchin, who headed a firm that made big money off the 2008 housing crisis.

SEN. ELIZABETH WARREN (D), MASSACHUSETTS: He promised when he was running for President that he would break the connection between Wall Street and this Congress. And then what does he do? He turns around and picks a guy who had actually been one of the people who helped do all of those lousy mortgages.

SCHNEIDER (voice-over): The President-elect's team defending the pick.

JASON MILLER, COMMUNICATIONS DIRECTOR OF PRESIDENT-ELECT DONALD TRUMP'S TRANSITION TEAM: It takes someone like Steve who understands how the system works, how we can go and make it more fair, how we can go and help American workers to get in there and actually change it.

SCHNEIDER (voice-over): Capitol Hill also reacting to Trump's announcement, with no details as of yet, that he will separate himself from his billion dollar empire.

SEN. JAMES RISCH (R), IDAHO: You've got to be very, very careful on conflicts of interest. Sooner or later, this had to happen. And I suspect he's probably not very happy about it, but it's just one of those things that had to be done.

SCHNEIDER (voice-over): The Office of Government Ethics sending out an unusual series of tweets applauding Trump's pledge and encouraging the President-elect to divest his assets, a commitment that Trump has not yet made.

(END VIDEOTAPE)

SCHNEIDER: And since Donald Trump is hitting the road, expected to leave here around 10:00 this morning, his transition team telling us we shouldn't expect any more personnel or Cabinet announcements this week. However, a shortlist is now emerging for the Director of National Intelligence position. On that list includes the Senior Senator from Indiana, Dan Coats, as well as former Homeland Security adviser Fran Townsend and Admiral Mike Rogers.

Also, another time that's surfacing, Sarah Palin. Sources telling us that she has thrown her name into the mix, expressing interest for the Secretary of Veterans' Affairs position -- Carol?

COSTELLO: All right. Jessica Schneider reporting live outside of Trump Tower this morning. Thank you so much. Now, let's head to Indianapolis, shall we, in the Carrier plant where Mr. Trump and Mr. Pence will meet with workers? CNN's Suzanne Malveaux is there.

Good morning. SUZANNE MALVEAUX, CNN NATIONAL CORRESPONDENT: Hey, good morning,

Carol. Well, we expect around 2:00 is when they're actually going to be at the plant. They're going to be touring on the floor, and it really is quite an amazing moment when you think about it.

It was 10 months ago that the owners were on that floor. They made the announcement to the employees that their jobs were all going to Mexico, and you had one of those workers pick up his cell phone and actually tape that moment and put it up on YouTube. It went viral, and Donald Trump noticed that and really made it a centerpiece for his jobs campaign. So it is coming full circle.

[09:04:58] There are some things in this deal. It is kind of murky but there are a lot of things that people are talking about. Why would this big company do it, their parent company, United Technologies?

Well, many incentives. One of those could be an easing of regulations. Also, tax incentives by the state of Indiana as well as the possibility, the threat that we heard from Trump during the campaign about tariffs on goods that would be imported from Mexico, very steep tariffs. This company, as well, United Technologies, has big business with the Pentagon, and it's 10 percent of its revenue. So, of course, they would want to have a good relationship with the Trump administration.

Carol, I had a chance to talk to a lot of folks yesterday. One of them is Chuck Jones. He is with United Steelworkers. He is one of the people intimately involved in negotiations between the workers and the owners of this company to try to keep their jobs, and it was very interesting what he had to say about Trump and Pence and why he believes this is happening. Take a listen.

(BEGIN VIDEO CLIP)

MALVEAUX: And, Chuck, you were no Trump supporter. You were pretty tough on him during the campaign. What do you think of him now? Do you think he's responsible for this?

CHUCK JONES, PRESIDENT, UNITED STEELWORKERS LOCAL 1999: Yes. I'm going to give him 100 percent of the credit. I wasn't a Trump supporter. In fact, I hammered him pretty good. And when I see him tomorrow, I'm going to tell him, you know, I hammered your ass pretty good, but I'm going to give you credit because what you said you was going to do, you fulfilled that promise and I appreciate it.

(END VIDEO CLIP)

MALVEAUX: Carol, there a lot of critics this morning, as well, who are speaking out about this, saying this is no economic policy. This is not the way to do business. One of those people, Bernie Sanders, in an op-ed in "The Washington Post," saying this essentially opens the floodgates for other company CEOs to threaten and say they're going to take their jobs offshore and to essentially look for some benefits, tax benefits, incentives that they think they can get from the government in exchange to keep those jobs here, Carol. COSTELLO: Yes, I'm just reading that op-ed by Bernie Sanders. It's

"The Washington Post" this morning. And, you know, Carrier is staying in Indianapolis supposedly because they're going to get state tax incentives which, of course, the taxpayers -- well, right. They'll pay, right?

So I'm just going to read a bit more of Bernie Sanders' op-ed here. He said, and I quote, "Instead of a damn tax, the company will be rewarded with a damn tax cut. Wow. How's that for standing up to corporate greed? How's that for punishing corporations that shut down in the United States and move abroad?"

And I want to go back to Suzanne for just a second because she talked with the union people there. Workers, though, do they really care how this was accomplished?

MALVEAUX: You know, that's a very good question, Carol, because I talked to a guy, John Feltner, and he with another company. This is called Rexnord. It is right down the street. They're losing their jobs. They're going to Mexico. He wants to talk to Trump now. He wants to get involved in negotiations and say, how do you save our jobs?

They don't care. They don't care if it's Trump. They don't care if it's the Governor Pence. They don't care if this is a tax break that's coming from taxpayers. They want their jobs, they want to keep their jobs, and for them, it's very personal. They're talking about anywhere like $25 an hour. And the guy I talked to, he's got three grown kids, two of them that he's trying to put through college. He's a new grandfather.

They don't care where this is coming from. They want their jobs saved. It's a very local issue. But when you broaden out nationally, it is not an economic policy.

COSTELLO: OK. We'll see what happens going forward because I am sure other companies will come forward and say, hey, President-elect Trump, how can you help us stay in the United States and do business? Suzanne Malveaux reporting live from Indianapolis this morning.

So let's talk about that and more. I'm joined by CNN political commentator and assistant editor for "The Washington Post," David Swerdlick, and Washington Desk senior editor and correspondent for NPR, Ron Elving. Welcome to both of you.

So, David, what do you make, Bernie Sanders publishes this op-ed in "The Washington Post" slamming Mr. Trump's efforts in Indianapolis? In the meantime, workers in Indianapolis couldn't be happier.

DAVID SWERDLICK, ASSISTANT EDITOR, THE WASHINGTON POST: Yes, Carol. So that's a piece that actually ran in my section of "The Washington Post," the "Post Everything" section. And I think it's a strong piece by Senator Sanders showing essentially that he's going to be out there as the loyal opposition to the way that President-elect Trump is doing business. He makes his economic case that this is a way, essentially, for businesses to hold up the government for tax incentives in order to not shift their jobs overseas.

On the other hand, as you said, Carol, right, there are 1,000 people who, according to the details we have so far, are going to have jobs in Indiana because of this deal, and I think that the administration, maybe more so Governor Pence or Vice President-elect Pence as the sitting governor of Indiana, more so than maybe President-elect Trump himself, should be able to take credit for negotiating with the company to stay and provide Indiana state tax incentives. There's two ways to see it.

COSTELLO: So, Ron, do you think that President-elect Trump will reveal the details of negotiations between himself and Carrier?

[09:10:08] RON ELVING, SENIOR EDITOR AND CORRESPONDENT, WASHINGTON DESK, NPR NEWS: Probably not, but we may learn more from Indianapolis. We may learn more as we find out what Governor Pence, who is, after all, still the Governor of Indiana, may have been able to offer here to Carrier, to United Technologies, the parent company that Suzanne Malveaux just mentioned. They're critical in all of this.

They make $5 billion, $6 billion in revenue from the federal government every year. Maybe cutting this 2,000-job move to Mexico in half, which is approximately what they've done, still moving 1,000 or so to Mexico, but by doing that, that's going to cost them about $65 million a year. What's that up against their relationship with the federal government? And what's that up against the P.R. value for them and, of course, for the Trump team?

COSTELLO: All right. We're going to talk more about Carrier because I have two economists that are going to come on my show after the break, so I want to turn our attention now to this "Thank You" tour. Later tonight, Donald Trump will be in Cincinnati. He's going to hold his "Thank You" tour in this big arena that seats 17,000 people. You can still get tickets online. This is unprecedented, David, but, you know, what else could you expect from Donald Trump?

SWERDLICK: Yes. Carol, again, I think this is something that you can see in a couple of different ways. On the one hand, you shouldn't be able to punish or criticize President-elect Trump for doing what Democrats maybe should have done at earlier stages throughout the Obama administration, other politicians maybe haven't availed themselves of, the idea of keeping this bond with their supporters, with their voters out in the states. He's really going out there and trying to keep this connection. It's smart politics.

On the other hand, you know, you have a situation where, last week, my colleagues, Adam Entous and Greg Miller, had reported that President- elect Trump has not sat for all of his intelligence briefings, has not done all of the things that some folks are saying he should do to prepare for taking the reins of government on January 20th. And you can see where it could be worrisome if he spends too much time politicking during the next month or two and not preparing for the task at hand. He's going to be the leader of the free world in just over about six weeks. COSTELLO: I was wondering, too, Ron, whether this could somehow unify

the country, that Trump's out and about in America, right? But then I thought, well, maybe it depends on how you look on this tour. Is it a victory tour or is it a "Thank You" tour? And I suspect Democrats and Republicans might think of it differently.

ELVING: Or is it a "Bring us all together" tour? As you suggest, it's all going to depend on what he has to say. If he goes out and has a rally in Cincinnati in which he says a lot of things that sound a lot like the campaign, especially the primary, especially the Republican primary, then it's going to be more divisive, one suspects, than united.

But if he goes out and talks about all the things he wants to do for all Americans, if he really radically changes the message that he was pretty much putting out there throughout the primary a year ago and six months ago, if he changes, that could really make a difference, and that could make this something other than just victory tour, just in your face tour. It could be a "Thank you, Ohio. Thank you, America. Let's go forward together."

COSTELLO: Well, David, I do wonder if his speech will be on prompter. Will he be freewheeling and will he play his campaign song, "You can't always get what you want"?

SWERDLICK: Yes, that, I don't know. But I think Ron made a great point. Yes, President-elect Trump has the opportunity to either do sort of a rub it in your face tour, "I won this election, let me remind you that," or, as Ron said, you know, time to take a moment out and say, "Look, I'm going to govern everybody, the election's over, I want to thank Americans for their support, and I'm going to try to represent both the people that supported me and the people that didn't support me."

That opportunity is there for him, and it really does depend on what he says today and in some of these other speeches.

COSTELLO: All right. David Swerdlick, Ron Elving, thanks for being with me this morning.

ELVING: Thank you.

COSTELLO: Still to come in the NEWSROOM, Donald Trump delivering on his vow to save Carrier jobs and his economic team says it will deliver a lot more. But at what cost?

(COMMERCIAL BREAK)

[09:18:27] COSTELLO: It will be a big day for Carrier employees. In just a few hours, Donald Trump and Mike Pence will celebrate a win for workers at Indianapolis. But, not everyone is ready for a tickertape parade. State lawmakers don't know exactly what Mr. Trump promised Carrier to make it stay or exactly how it might affect taxpayers.

So, let's talk about all this. I'm joined by chief business correspondent Christine Romans, former Obama White House chief economic adviser Austan Goolsbee, and former director of the nonpartisan Congressional Budget Office, Douglas Holtz-Eakin.

Welcome to all of you.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Hi, Carol.

COSTELLO: OK, I'm going to start with you, Christine. Carrier is owned by United Technologies. United Technologies makes aircraft parts.

The unknown here is this: Did Donald Trump threaten to pull federal defense contracts from United if it didn't save those Carrier jobs?

ROMANS: And it didn't even have to. I mean, think of this -- you have the president-elect of the United Sates calling the CEO of United Technologies. United Technologies had some almost $6 billion of contracts with the federal government, and on the campaign trail Donald Trump has said, I'm going to put a tax on that company. I'm going to tax them for sending jobs overseas, and then bringing the product back to the United States.

So, if you're the CEO of United Technologies, what do you do? You play ball with Donald Trump at this point. That's what's so remarkable at this point. We haven't had a CEO who has -- or a president rather who's been able to make a company keep jobs in the U.S. What were the sweeteners here? Why did they do it?

United Technologies says it was state incentives that were a very big factor here. But many are presuming that Donald Trump has said look this is going to be a business friendly environment for big companies, I'm going to be cutting taxes, you should see what kind of policies I'm going to have that's going to be good for you, do this for me.

[09:20:07] We'll find out more details I hope today, Carol.

COSTELLO: I hope so, too.

So, Austan, what if Mr. Trump did threaten United Carrier? Who cares if it saves jobs?

AUSTAN GOOLSBEE, PROFESSOR OF ECONOMICS, UNIVERSITY OF CHICAGO: Look, my view is, nobody hides numbers that are favorable to them. So the fact that they will not release publicly what was offered to Carrier to get them to keep the jobs in Indiana probably suggests that it was more generous to the company that threatened to leave than the American people would be comfortable with. But, you know, we're going to have to see.

I think with the announcement of the economic team, and with the announcement of this Carrier deal, you kind of see in the same thing, the same dynamic play out, which is Donald Trump promising a certain thing in the campaign, I'm going to be tough, I'm going to bust down on Wall Street, I'm going to go to carrier and I'm going to tell them they have to stay.

And then now that he's actually going to be in office, instead of threatening them, he just paid them to stay. And instead of trying to drain the swamp, you know, the joke is, yes, he's draining the swamp right into the West Wing. He's hiring people straight from Wall Street that he said he was going to --

COSTELLO: OK, so you sound a lot like Bernie Sanders because as we mentioned in the first block of this show, Bernie Sanders wrote an op- ed in "The Washington Post" and this is part of what he wrote. Quote, "Trump has endangered the jobs of workers who were previously safe in the United States. Why? Because he has signaled to every corporation in America that they can threaten to offshore jobs in exchange for business friendly tax benefits, and incentives."

Do you think that's what happened, Douglas?

DOUGLAS HOLTZ-EAKIN, PRESIDENT, AMERICAN ACTION FORUM: Well, I think any president should be nervous about engaging in one-on-one contract negotiations, or bully pulpiting with a corporation.

It makes sense for a president and his team to change the tax code, change the regulatory environment, improve the capacity of the business community to do what it does. But if you do this, two things happen. Number one, you put in place incentives for other companies to see what they can get. That's a real phenomenon. Number two, at some level, he now has ownership of the success of the Indiana operations of Carrier.

And that's nothing that he should have any particular incentive in. And it leads to further down the line, the possibility he might try something more to make sure it works out. So, I'm not a big fan of this kind of a negotiation and I think the more limited it is, the better.

ROMANS: Carol, I'll point out that the company said in a press release that it still believes in free trade, and it still believes in the effects of globalization and the forces of globalization. You know, in Mexico, $3, $5 an hour for some of these jobs, in Indiana, you're talking about $20 for some of these longer-term people, employees, they've been there for 10, 15, 20 years.

So that is a big pay differential. What are the big policies that Donald Trump and his team are going to enact that are going to level that playing field? That is the bigger policy prescription, not one- off, one by one companies.

COSTELLO: Here's the other thing, Austan, state lawmakers in the state of Indiana, they had nothing to do with this. So, if -- if Carrier was offered these big time tax incentives, and the state lawmakers have no say in the matter, and they represent the taxpayers in the state of Indiana, isn't that a slippery slope? Austan? That's --

GOOLSBEE: Oh, yeah, look, I think it is a slippery slope. My point is, there's one thing to say I'm going to be a tough negotiator, and I'm going to get them to agree to my position. And if what had happened was it was all of that threat of the federal government, and the contracts, that would be one thing. That was, in a way, what he campaigned on. But to just turn around and pay them to stay, I think raises a bunch of questions, and I think it also raises the question, if Hillary Clinton had done exactly what Donald Trump and Mike Pence did here, if she did exactly the same thing, do you not think Donald Trump would be condemning the action and saying, this was corruption, she paid this company to stay there, I just think this is a weird -- it's a weird way to do it. I'm happy those people got to keep their jobs but this is a very weird way to do it.

COSTELLO: Well, well the other thing, Douglas, too, 1,000 jobs is a lot of jobs, right? But in the grand scheme of the number of jobs moving to other countries, which is somewhere around 250,000, it's a drop in the bucket.

So, what do you do for other companies who have many more employees, right, that Donald Trump would like to remain in the United States?

HOLTZ-EAKIN: So, look, I think it's a mistake to focus in on one company. It's not the president's job. It's not a big number in the U.S. labor market.

It's a different thing I think as Austan and Christine said to have the state of Indiana say it's worth it for us, as taxpayers, and a the elected officials in Indiana to keep these operations here.

[09:25:02] And we are willing to make up the difference so that Carrier is willing to do it. That makes perfect sense and that could have happened without the involvement of the president-elect.

So, I think going forward, the real issue is, will this president and his team, who are businessmen by background, take a different path, which is to look at the overall performance of the labor market, and of the economy, and leave the date-to-day decision making, individual companies to the CEOs, and the people who are running it?

COSTELLO: Well, hopefully, we'll find out more information around 2:00 Eastern. We'll see.

But, Christine, actually before you, we are minutes away from the opening bell. So, how might the market react to this?

ROMANS: Well, you know, we're seeing higher here, we're getting auto sales, Ford auto sales very strong again. That's a good sign in the economy. That stock is up.

So, we keep seeing these strong readings on the economy a good tail wind for Donald Trump and his economic team as the come in here. So, we're watching futures are higher here and you know it was a great month of November for stocks, the best month since March almost 1,000 points on the Dow. The Dow up almost 1,000 points since this election really remarkable.

Big move in oil. Be watching how that will play out in the stock market this morning but I'm expecting you're going to see a rise in the Dow when it opens in about four minutes. Watch those auto stocks, and again a very good month for stocks in November and December the first trading day today, Carol.

COSTELLO: Christine Romans, many thanks to you, and also to Douglas Holtz-Eakin and Austan Goolsbee.

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