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Interview With U.S. Deputy National Security Adviser Ben Rhodes; Punishment for Russia?; Allies Clash; Obama, Trump Relations Become Openly Strained; Interview with Representative Peter King of New York. Aired 4-4:30p ET

Aired December 28, 2016 - 16:00   ET



JAKE TAPPER, CNN ANCHOR: President Obama, with 23 days to fix thousands of years' worth of problems.

THE LEAD starts right now.

Rebuking an ally, Secretary of State John Kerry saying, unless a Palestinian state is formed, Israel will have to face a dilemma of being Jewish or democratic, but cannot be both, as President Obama makes one final drive to try to forge a peace process in the Middle East.

Bumpy ride. President-elect Trump taking on President Obama, on Twitter, naturally, accusing the man he will soon replace to put up roadblocks to his transition. Might he have a point?

Plus, payback time. President Obama expected to announce punishment for Vladimir Putin and his hackers, both on the grid and off.

Good afternoon, everyone. Welcome to THE LEAD. I'm Jake Tapper.

We are going to begin today with the world lead, of course. With just about three weeks until President Barack Obama joins the long list of U.S. presidents who could not broker peace between the Israelis and the Palestinians, today, his secretary of state, John Kerry, gave a speech that seemed focused on rebuking Israeli Prime Minister Benjamin Netanyahu for undermining any hopes for a two-state solution.

This of course comes at a time when the relationship between the two countries may be at its lowest point since the Eisenhower administration, and with a president-elect waiting in the wings tweeting, telling Netanyahu essentially, just a few more days, Bibi, I am on my way.

Kerry stated today that a two-state solution is, in his view, the only path to peace. He defended the decision to allow a U.N. resolution condemning Israeli settlements to make it through the U.N. Security Council, something the Louisiana prime minister had called a shameful ambush.

CNN's global affairs correspondent, Elise Labott, is live for us at the State Department. Elise, 23 days until Kerry hits the slopes, what was the purpose of

the speech?

ELISE LABOTT, CNN FOREIGN AFFAIRS CORRESPONDENT: Well, Jake, Secretary Kerry realizes that his ideas may not have a home now, but after four years of trying unsuccessfully to make peace between Israelis and Palestinians, Kerry felt he couldn't in good conscience walk out the door without putting forward a vision for how he sees peace and the policies that threaten it.


JOHN KERRY, U.S. SECRETARY OF STATE: The status quo is leading towards one state and perpetual occupation.

LABOTT (voice-over): In a lengthy and deeply personal final plea, Secretary of State John Kerry issued a strong warning to Israel that a two-state solution was in jeopardy, directing his aim at the Israeli Prime Minister Benjamin Netanyahu.

KERRY: The Israeli prime minister publicly supports a two-state solution, but his current coalition is the most right-wing in Israeli history, with an agenda driven by the most extreme elements.

LABOTT: At the same time defending U.S. support of Israel.

KERRY: No American administration has done more for Israel's security than Barack Obama's.

LABOTT: Netanyahu quickly called the speech a biased attack that only paid lip service to Palestinian terror.

BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: What he did was to spend most of his speech blaming Israel for the lack of peace.

LABOTT: Kerry's message comes amid a bitter war of words between U.S. and Israel after Washington refused to veto a U.N. resolution condemning Israeli settlements, allowing it to pass.

KERRY: Some seem to believe that the U.S. friendship means that the U.S. must accept any policy, regardless of our own interests, our own positions, our own words, our own principles.

LABOTT: Israel says it has proof Washington secretly orchestrated the vote and will show it to president-elect Trump when he takes office in just a few weeks.

NETANYAHU: We have it on absolutely incontestable evidence that the United States organized, advanced and brought this resolution.

LABOTT: Kerry denied the claims and framed the vote as an effort to save Israel from a policy that threatened its future as a Jewish state.

KERRY: We reject the criticism that this vote abandons Israel. On the contrary,it is not this resolution that is isolating Israel. It is the permanent policy of settlement construction that risks making peace impossible.

LABOTT: In his four years as secretary of state, a deal between Israelis and Palestinians has escaped Kerry, but in a recent interview with CNN, he rejected the idea that he failed.

KERRY: I didn't fail. We didn't fail. The United States didn't fail. We put what I think is still the solution on the table. But the parties failed.

LABOTT: Even before Kerry spoke, both president-elect Trump and Prime Minister Netanyahu criticized the Obama administration, Trump tweeting: "We cannot continue to let Israel be treated with such total disdain and disrespect. Stay strong, Israel. January 20 is fast approaching."

Netanyahu responded: "President-elect Trump, thank you for your warm friendship and your clear-cut support for Israel."


LABOTT: Now, Prime Minister Netanyahu warning against any more U.N. action. Israeli officials very concerned that Kerry's ideas could be enshrined in a new resolution before President Obama leaves office.


U.S. officials say they do not see any more U.N. action. Meanwhile, president-elect Donald Trump is working with Congress to defund the U.N. if that first vote is not overturned -- Jake.

TAPPER: Elise Labott, thank you so much.

Let's go live now to Jerusalem and our own CNN correspondent Oren Liebermann.

Oren, what is the general response in Israel to the speech from Secretary Kerry?

OREN LIEBERMANN, CNN CORRESPONDENT: Well, I don't think the speech is going to be incredibly popular at all.

The U.N. Security Council resolution wasn't popular here among the left, the right or the middle. And I think many Israelis, including the Israeli government and certainly Prime Minister Benjamin Netanyahu, see this speech as an extension of that Security Council resolution.

Netanyahu explicitly brought it up when mentioning why he opposed the speech there. I don't think Netanyahu sees much of a difference there. It's worth noting a couple things here. First, the speech wasn't carried live here.

That may have something to do with how unpopular the Security Council resolution was itself, maybe the first few minutes, but not the entire 70 minutes, which means the Israeli population didn't hear live at the end what Kerry said were his parameters, his ideas for how to actually make progress on Israeli-Palestinian negotiations.

Second, Netanyahu made very, very different statements when he responded to the Kerry speech. One in Hebrew was definitely for Israelis. It was very different and much shorter than what he said in English. That was directed not only at Americans, but President Barack Obama specifically.

Here is part of what he had to say about his concerns about what might come next in Obama's last three weeks in office.


NETANYAHU: I think the United States, if it's true to its word, or at least if it's now true to its word, should now come out and say, we will not allow any resolutions, any more resolutions in the Security Council on Israel, period, not we will bring or not bring. We will not allow any.

And stop this game, the charades. I think that the decisions that are vital to Israel's interests and the future of its children, they won't be made through speeches in Washington or votes in the United Nations or conferences in Paris.

They will be made by the government of Israel around the negotiating table, making them on behalf of the one and only Jewish state, a sovereign nation that is the master of its own fate.


LIEBERMANN: I don't think there is any surprise here that the Israelis oppose the speech, condemn and criticize the speech. The Palestinians were happy to hear it. Here is a statement from Palestinian President Mahmoud Abbas through PLO secretary-general.

It says: "The minute the Israeli government agrees to cease all settlement activities, including in and around occupied East Jerusalem, and agree to implement the signed agreements on the basis of mutual reciprocity, the Palestinian leadership stands ready to resume permanent status negotiations on the basis of international law."

Jake, you want to see where the conflict stands, listen to the two statements from the Israelis and Palestinians and realize they are nowhere near each other.

TAPPER: That's right. Oren Liebermann, live in Jerusalem for us, thank you.

Joining me now from the White House, someone whom the Israelis have mentioned by name during this dispute, White House Deputy National Security Adviser Ben Rhodes.

Ben, thanks for joining us. Appreciate it.

BEN RHODES, U.S. DEPUTY NATIONAL SECURITY ADVISER: Thanks, Jake. TAPPER: Let's talk about what you just heard Prime Minister Netanyahu

said about the U.S. not allowing any more resolutions. Specifically, let's play the sound of Secretary of State John Kerry talking about the U.N. and possible further actions.


KERRY: There are other countries in the U.N. who believe it is our job to dictate the terms of the solution in the Security Council. Others want us to simply recognize a Palestinian state absent an agreement.

But I want to make clear today these are not the choices that we will make.


TAPPER: So, just to be clear here, when Secretary Kerry says these are not the choices we will make, which is kind of vague, is he saying that the U.S. would veto any resolution in the U.N. which might dictate a peace solution or might recognize a Palestinian state?


TAPPER: He would veto that? The U.S. will veto that?

RHODES: Yes. And we have made that clear over and over, Jake.


The point has been made by the Israelis -- and I would love to get your comment on this -- that there is no loss of things that the U.S. government, that the Obama administration could be leaving the stage talking about, whether it's the genocide in Sudan, the crisis in Syria, Russian hacking, Chinese hacking, Chinese intervention in the South China Sea, climate change, et cetera.

Why focus on Israeli settlements?

RHODES: Well, Jake, we're working on all those issues too.

We are going to be dealing with the Russian hacking. We're dealing with climate change on a regular basis. I think it's a false argument to say that, because there are other issues, we shouldn't focus on this one.


The fact of the matter is, we are focused on this one because the current trends on the ground, particularly the current Israeli settlement activity, is making a two-state solution potentially impossible, and creating a reality where essentially what you are going to have is a one-state solution, where the West Bank is increasingly occupied by Israeli settlements.

TAPPER: Prime Minister Netanyahu today repeating that the Israelis have indisputable evidence that the U.S. was behind the resolution. As you know, Israeli's Channel 1 reported on these alleged transcripts of a meeting between Kerry and Palestinian officials, which National Security Council spokesman Ned Price flat out denied with a tweet.

But it's also true that the meeting between Kerry and Saeb Erekat is right on the State Department Web site as an appointment. I guess the most important question is, was there any prior contact between White House officials or State Department officials and either senior Egyptian officials or senior Palestinian officials specifically regarding the resolution that the Egyptians put forward at the Security Council last week?

RHODES: Well, Jake, first of all, I think it's absurd that we are even talking about a report in an Egyptian tabloid of a meeting that never took place. That's the first point.

The second point is, we have meetings with the Palestinians, with the Israelis, with members of the Security Council all the time about any number of things. I wasn't in those meetings.

What I can tell you with certainty, Jake, is that we did not draft this resolution and we did not put this resolution forward. This was something the Palestinians and the Egyptians had been working on for some time.

People were aware, of course, that there are resolutions at the U.N. all the time. We are not at all shrinking from the fact that, when this came to a vote and we looked at the language, we decided to abstain.

And, Jake, I think what's happening here is an effort to distract from the substance of the actual debate. The question is about why it is OK for there to be nearly 90,000 settlers outside of the separation barrier that the Israeli itself has built. Why is this prime minister saying in Israel this is the most pro-Israeli settlement government in history?

How is that consistent with the stated policy of this Israeli government that it supports a two-state solution? Why is there a bill in the Knesset that would legalize even these distant outposts in the West Bank?

I think this is an effort to distract from the very real debate we should be having that Secretary Kerry talked about today.

TAPPER: But just to put a button it, Ben, you are not suggesting that you guys -- when I say you guys, the White House and the State Department, that you didn't know that the Palestinians and the Egyptians were planning this and you -- and you're not denying that you told them that you might abstain, thus allowing it to pass?

RHODES: No, that is not the case, Jake. We never told anybody how we would vote on the text of a resolution, because we didn't know what the text of the resolution was going to be until it was introduced by the Egyptians. All the time, we have conversations about different resolutions that

are kicking around in the Security Council. But we had not communicated how we would vote. We did not draft it. We didn't know what the text was going to be until it was put forward.

And the president of the United States didn't even give instructions to Samantha Power as to what her vote would be until the day of the resolution.

So, let's be clear here, Jake. This is a distraction. We own the fact that we abstained from this resolution because we believed that that was the right thing. So, we're ready to defend our decision to abstain on that resolution.

I think it's the Israeli government that is trying to have this distraction from the real debate, which is, how are their settlement policies, including building deep in the West Bank, pursuing laws that would legalize outposts deep in the West Bank, displacing Palestinians from their homes in the West Bank, how is that consistent with their stated policy of pursuing a two-state solution?

TAPPER: Part of the problem might be -- and there might be a disconnect for Americans -- is the notion that, on the one hand, you have Israelis building housing settlements, and let's posit for the sake of argument that they are destructive to the peace process.

But on the one hand, you have Israelis building housing settlements, and yet on the other hand you have Palestinian leaders that have been credibly accused of inciting violence that has resulted in innocent Israelis being killed.

As you know, Hamas, a group that the United States government categorizes as a terrorist organization, governs Gaza. There's fear that if the West Bank had elections tomorrow, Hamas would win those elections.

And I guess the question for a lot of voters might be, why are you focusing on the Israelis?

RHODES: Jake, we have given Israel $38 billion in defense assistance over the next 10 years.

We defended Israel, when we were the only country really in the world to be doing it, when they went to war in Gaza twice to stop that rocket fire coming from Hamas.

Time and again, we have supported their right to defend themselves. The resolution that we abstained from called out incitement and condemned incitement and violence. That's one of the reasons why we abstained, because it had that balance.

[16:15:02] This is not a question of whether or not we've called out Palestinian incitement in terrorism. We have consistently and we've helped Israel defend itself. We have saved Israeli lives with our defense for the Iron Dome missile defense system that has shot down rockets coming from Gaza. The problem with the settlements that people need to understand is

that this is building deep inside of the West Bank. And what you hear in the United States often is rhetoric about support for a two-state solution. The reason that this is worth focusing on, these are not just housing settlements, these are construction that is taking place on Palestinian land, on what anybody who has looked at this issue understands to be a future Palestinian state.

Jake, there is a term of art about building inside the blocks, that means building outside of the 1967 lines but within what people generally expect to be the borders of an Israel in a two-state solution. That's not even what's happening. This is building deep inside the West Bank. I think part of what we're trying to do is bring more attention on that --

TAPPER: I know --

RHODES: -- and have people like you reporting on that. This is changing the facts on the ground and making a two-state solution nothing more than a talking point.

TAPPER: But I hear what you're saying, but you still didn't, respectfully, answer the question which is, voters out there, American citizens out there, might think on one hand you have people building homes and, OK, you're calling them illegal and they're detrimental to the peace process, but it's construction. And ultimately, people can leave houses.

And on the other hand, you have people killing people and that's just final. And that there seems to be a moral equivalence argument being made that might rub a lot of people the wrong way and confuse them.

RHODES: There is no moral equivalence. There is no justification for terrorism. No settlement construction should ever, ever justify terrorism or incitement to terrorism. On that, there is just no question on that. And Secretary Kerry made that clear again today. We're drawing no equivalence.

The fact of the matter is, though, Jake, describing them only as people building houses, they are displacing Palestinians from their homes, they're taking land that everybody who has looked at this issue thinks would be part of a Palestinian state, they're making the possibility of a contiguous Palestinian state with the territory connects itself impossible.

So, again, the question is, if it is U.S. policy, which it has been under multiple administrations of both parties to support a two-state solution, why should we be silent in the face of policies that clearly are going to make that impossible?

And as I mentioned, Jake, this government has been very clear about its intentions. Prime Minister Netanyahu saying himself this is the most pro-settlement government in Israeli history. Israeli Knesset advancing a law that would legalize even these distant outposts that are deep inside of the West Bank. Again, if it is America's interests, as it has been under President Bush and President Obama to pursue a two-state solution, why should we be silent when there are policies being pursued that make a two-state solution impossible?

TAPPER: One last question for you, Ben, which is -- President Obama I know is not going to go softly into that good night. He will be active and talk about issues of concern to him, specifically when they disagree with President-elect Trump. I'm thinking mainly of climate change. I'm thinking mainly of justice reform.

Is this also going to be in the bread basket of the soon-to-be ex- president? Will President Obama be making the peace process and Palestinian rights one of the issues that he works on in his post- presidency?

RHODES: Jake, I'm not sure of the extent to which he'll focus on this in his post-presidency. I think he will be working on a lot of issues. I think one of the points that we are trying to make here, Jake, people tend to view this through the prism of American politics. It's certainly the case that the next president indicated he's going to take a different course of action. That's not going to change anything on the ground.

On January 21st, there's going to still be settlements that are causing Israeli to be isolated internationally, that are causing a two-state solution to be put further and further at risk. So, again, this problem isn't going away just because there is a new administration. It's going to continue to be with us just as it has been for decades.

I think President Obama will want to be engaged as he feels like he can make a positive difference. But, again, the extent to which he focusing on this I think will depend on circumstances.

TAPPER: Deputy national security adviser Ben Rhodes -- thank you so much. Happy New Year to you and your family.

RHODES: Thanks, Jake. You too.

TAPPER: Donald Trump is ratcheting up his public spat with President Obama. But is the president-elect the one out of line? We just heard from Mr. Trump. That story next.


[16:22:36] TAPPER: Welcome back to THE LEAD.

After years of being a thorn in President Obama's side, shortly after the election, President-elect Trump finally met Obama. And guess what? He kind of liked him.

But, if you thought there was a chance that they might become bipartisan besties? No.

CNN correspondent Sunlen Serfaty is live in Palm Beach, Florida.

And, Sunlen, President-elect Trump making it clear he's not happy about some of President Obama's recent comments and -- this afternoon, however, he is trying to move forward with his transition plans. SUNLEN SERFATY, CNN CORRESPONDENT: That's right, Jake. Transition

officials tell us that the president-elect will be making an economic message of some sort later this afternoon, potentially within this hour. But even as he tries and works hard to stay on message and focus on his own transition, he at the same time is really diving deeper into this public feud that he is having with President Obama. Earlier in the day taking to Twitter to basically allege that President Obama is to blame for this transition not going as smoothly as he would have liked.

But then just moments ago, Trump coming out and telling reporters here at Mar-a-Lago that that's not true, that he really backing off the charge, saying that all is well. His transition, he thinks, is going quite smoothly.


SERFATY (voice-over): Huddled at his Mar-a-Lago estate today, President-elect Donald Trump is escalating his public spat with Barack Obama, taking direct aim at the president, tweeting today, quote, "Doing my best to disregard the many inflammatory President O statements and roadblocks. Thought it was going to be a smooth transition. Not."

That coming after President Obama used his high-profile speech at Pearl Harbor Tuesday to take a veiled jab at his successor.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Even when hatred burns hottest, even when the tug of tribalism is at its most primal, we must resist the urge to turn inward. We must resist the urge to demonize those who are different.

SERFATY: The escalating war of words between the outgoing and incoming president, a sharp departure from the immediate post-election vow to work together.

OBAMA: We now are going to want to do everything we can to help you succeed --

SERFATY: With promises from both sides for a peaceful transfer of power.

DONALD TRUMP (R), PRESIDENT-ELECT: I very much look forward to dealing with the president in the future, including counsel.

[16:25:02] SERFATY: The Trump transition team today attempting to downplay the tension.

SEAN SPICER, INCOMING WHITE HOUSE PRESS SECRETARY: Both the current president and his team have been very helpful and generous with their time as far as the actual transition, the mechanics of the transition have gone and we continue, I expect them to continue to speak on fairly regularly.

SERFATY: But their relationship showing strains publicly. Obama quipping he thinks he would have won the election if he could have run again.

OBAMA: I'm confident that if I -- if I had run again and articulated it, I think I could have mobilized the majority of American people to rally behind it.

SERFATY: Trump taunting him right back, tweeting, "President Obama campaigned hard and personally in the very important swing states and lost. The voters wanted to make America great again."

And taking another swipe at the president, altering a "thanks Obama" catch phrase to "thanks Donald". Trump talking in the third person, giving himself credit on the economy, tweeting, "The U.S. consumer confidence index for December surged nearly four points to 113.7, the highest level in more than 15 years. Thanks, Donald."

At Mar-a-Lago today, Trump trying to focus on his own transition.

TRUMP: I think very, very smoothly. It's going good. You don't think so?


SERFATY: And as Trump takes his meetings here at Mar-a-Lago, we do expect at some point to have more job decisions and announcements potentially coming near the end of the week, including, Jake, those still yet to be named cabinet positions. There are at least a few -- Jake.

TAPPER: All right. Sunlen Serfaty, thank you so much.

For more on the transition of power and maneuvering between the Obama administration and the president-elect's transition, let's bring in New York Congressman Peter King, a Republican who met with Trump earlier this month.

Congressman, thanks for joining me, as always.

REP. PETER KING (R), NEW YORK: Thank you, Jake. Thank you very much.

TAPPER: So, see if you can clear this up for me. On one hand, we have President-elect Trump, who suggests that the transition is not going smoothly. And on the other hand, we have President-elect Trump who suggests that the transition is going very smoothly. Which one is right?

KING: I would say what Donald Trump is saying is that some of the statements that President Obama is making, or some of the actions as far as the U.N., with Israel, for instance and even President Obama saying he thinks he could have won if he had run again, that is interfering, let's say, the psychology of the transition.

But as far as the actual positioning, as far as the appointments, as far as getting the -- his new administration in place, Donald Trump feels that the transition is going smoothly.

And overall, from what I understand, that the actual people working at the White House are cooperating with the Trump people to make that work. So, I think his complaint is with President Obama himself, not with the administration, and certainly not what's happening on the ground.

TAPPER: OK, fair enough. Let me ask you, though, is it fair to say that President-elect Trump has also not hued to traditional norms when it comes to respecting the idea that there is one president at a time? He's been very active talking about Taiwan and China. He has been discounting what the intelligence community says.

It's also fair, if you'll let me posit the point, that OK, what President Obama said about maybe he would have won a third term, also true that President-elect Trump hasn't really been traditional either.

KING: No, he hasn't been traditional. But I think, for instance, in the administration when you had -- without starting this issue all over again -- when you had somebody in the CIA leaking out that they concluded that the Russians were supporting Donald Trump over Hillary Clinton, I mean, that to me was an unfair shot coming from the administration, especially since it never provided evidence to back it up.

But overall, I think that Donald Trump is non-traditional. But on the other hand, he's also been very respectful of President Obama. Like you notice, at those rallies he was having, the victory rallies, and anytime people would start booing or making noises about either President Obama or the first lady, Donald Trump would jump in to defend them and say how cooperative they have been, how friendly they've been, and he was giving them credit for their very best of intentions.

So, listen, all in all, Donald Trump is non-traditional. He is doing it his way. But I think he is showing respect for both President Obama and the presidency.

TAPPER: I'm sure you disagreed with much of Secretary of State Kerry's speech today about the Israeli settlements. But let me ask you as a general point. Is it fair to say that the continued construction of settlements in the West Bank is actually an impediment to a peaceful solution and a two-state solution?

KING: I think ultimately, some of those settlements are going to have to be scaled back. But I think, despite what Ben Rhodes was saying, there was a moral equivalence tone to what John Kerry was saying today between settlements on one hand and terrorist activities by the -- murders carried out by the Palestinians on the other. And also, I don't think he gave the Israelis enough credit for what they've done over the years. I remember back in 2000, President Clinton later told me, this was one of his biggest disappointments.