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WSJ: Trump May Be Open To Lifting Russia Sanctions; House Vote Sets Path to Obamacare Repeal; Democrats Blast FBI Chief After Briefing; Government Ethics Chief Blasts Trump; Michelle Obama Says Farewell After 8 Years. Aired 7-8a ET

Aired January 14, 2017 - 07:30   ET

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


[07:00:00] VICTOR BLACKWELL, CNN ANCHOR: Thank you so much. Everybody, stay off the roads, please.

CHRISTI PAUL, CNN ANCHOR: No doubt about it. And, boy, a lot of political news happening overnight in that arena.

BLACKWELL: We have a lot for you. The next hour of your NEW DAY starts right now.

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: The FBI director has no credibility.

UNIDENTIFIED FEMALE: FBI Director James Comey facing renewed scrutiny on both sides of the aisle.

UNIDENTIFIED MALE: Jim Comey is an honorable person who I think made a bad decision.

UNIDENTIFIED MALE: When the director of the FBI can't answer those questions, it does shake our confidence.

DONALD TRUMP (R), PRESIDENT-ELECT: Putin did call me a genius and said I'm the future of the Republican Party.

UNIDENTIFIED MALE: Putin then denied claims that Russia has compromising on him.

UNIDENTIFIED MALE: The U.S. Department of Justice releasing a scathing report of the Chicago Police Department.

LORETTA LYNCH, U.S. ATTORNEY GENERAL: There is reasonable call to believe that the Chicago Police Department engages in a pattern or practice of abuse and excessive force.

UNIDENTIFIED MALE: (INAUDIBLE) was first reported missing. The search was intense.

UNIDENTIFIED FEMALE: This is going to be the happiest day in the world to hold my baby.

UNIDENTIFIED MALE: We found an 18-year-old young woman with the same date of birth, but a different name. (END VIDEOTAPE)

PAUL: What a story that is. We're going to bring that to you in just a little bit.

We do want to wish you a good Saturday morning. And thank you for sharing your time with us. I'm Christi Paul.

BLACKWELL: I'm Victor Blackwell. Good to have you for NEW DAY.

This morning, less than a week to go before President-elect Donald Trump takes the oath of office in Washington. Today, immigration activists around the country will be rallying in the nation's capital. Two rallies planned in Washington. One, at an historic church, the other at the Martin Luther King Memorial. We'll be following both of those for you this morning.

PAUL: That, of course, as the president-elect is suggesting in a new interviewing that he's open to lifting sanctions on Russia, but plans to keep them, quote, "for at least a period of time."

Meanwhile, Republicans are already taking steps to dismantle Obamacare. House members voting mostly along party lines on a bill allowing Republicans to begin work on rolling back parts of the health care law.

CNN's Jessica Schneider is live in front of Trump Tower right now.

BLACKWELL: Jessica, the president-elect's comments on Russia, what does this mean for the future of U.S./Russia relations?

JESSICA SCHNEIDER, CNN CORRESONDENT: Well, you know, Victor, the president-elect has repeatedly expressed his willingness to engage with Russia, and he did it again last night in that hour-long interview with "The Wall Street Journal", saying that he is, in fact, prepared to meet with Russian President Vladimir Putin once he's sworn in. He also addressed the issue of those sanctions against Russia.

Now, Donald Trump nor his team had actually talked about this in the past. But Donald Trump talking to "The Wall Street Journal", implying he could be willing to roll back those sanctions, that included sending 35 Russian diplomats back to Russia. Donald Trump consistently saying this to "The Wall Street Journal", saying, "If you get along and Russia is really helping us, why would anybody have sanctions if somebody's doing some really great things?" Donald Trump talking there about the possibility that Russia could engage in United States in helping to eliminate terrorism, to battle ISIS overseas and also to help the U.S. what other goals.

But, of course, this could once again put Donald Trump at odds with congressional Republicans. Congressional leaders, of course, have repeatedly expressed their hard line stance, or the hope that there will be a hard line stance against Russia, in the wake of that U.S. intelligence that said that Russians were, in fact, responsible for the hacking during the election season. Of course, the hacking also of the DNC, and, of course, against Clinton's campaign chair, John Podesta.

So, a lot of open questions here, but Donald Trump saying that yes, he's willing to engage with Russia and also, there could be the possibility that those sanctions get rolled back -- Victor and Christi.

BLACKWELL: All right. Before we let you, speaking of engaging with Russia, Trump's transition spokesman Sean Spicer confirms that retired General Michael Flynn, the incoming national security adviser for Donald Trump, contacted Russia's ambassador to the U.S. this past December. That was actually on the same day that the White House announced sanctions against Russia.

Tell us about that.

SCHNEIDER: Well, yes, a lot of open questions there, Victor. And the Trump team confirming that, yes, in fact, national security adviser Michael Flynn did have conversations and communication with the Russian ambassador to Washington on multiple occasions. In fact, the two first communicated back when Russia's ambassador to Turkey was shot. They also communicated by text messaging on Christmas, merely wishing each other merry Christmas.

But the real question comes in, as you mentioned, in that December 29th phone call where the two actually did speak on the phone, the Trump transition team saying that that conversation merely was about when Donald Trump could speak to Russian President Vladimir Putin. But, of course, that date, the same day that President Obama imposed those sanctions on Russia, expelling those 35 Russian diplomats.

Of course, the big question here being whether or not there was more to that conversation than just arranging that meeting, or potential phone call between Donald Trump and Vladimir Putin.

[07:05:04] The big issue being that, of course, there's a thing called the Logan Act, a centuries old act which does bar U.S. citizens from interfering in any disputes or controversies between the U.S. and a foreign government.

So, was this against the law? The Trump team is saying no way. But, of course, that could be an open question -- Victor and Christi.

BLACKWELL: All right. Jessica Schneider, outside of Trump Tower -- thanks so much.

PAUL: Let's bring in CNN political analyst Errol Louis into the conversation, and White House correspondent for "The Washington Examiner, Sarah Westwood as well.

Good morning to both of you. Thanks for being here.

ERROL LOUIS, CNN POLITICAL COMMENTATOR: Good morning.

PAUL: Good morning.

Errol, I'd like to start with you, because we've seen two different versions of this with Donald Trump just in the last week when it comes to Russia. He says, of course, that he does think Russia is to blame for the hacking. And then he tells "The Wall Street Journal" what Jessica was pointing out that he's not opposed to lifting sanctions.

Is this a strategy at this point, Errol, you know, to be noncommittal prior to getting into office? And if it is his strategy, is it a smart one?

LOUIS: Well, I don't know if I would call it a strategy. I would say, maybe it's closer to a style or a tendency. With Donald Trump, we've seen in politics, as in his commercial dealings, he tends to leave him ambiguous and give himself enough wiggle room to negotiate and maybe change course if he decides to along the way. Again, he did it in business quite a bit, has been doing it in politics quite a while.

And because he doesn't a doctrine or a philosophy or book or anything that we can point to that says he's going to try to be consistent on foreign policy, Russian relations or anything else, we don't really know where he's going with any of this. I think, though, almost more troubling in a way is this notion that when he says, well, if Russia is doing great things, why would we impose sanctions on them?

The sanctions were imposed for a very specific reason. And it has to do with the illegal annexation of territory in Europe for the first time since the end of World War II. I mean, this is -- the part of all of that, I think, is missing the piece of puzzle here is that when Donald Trump says, well, we could have an alliance with Russia and it would help us fight ISIS, that's one thing.

But based on that alone, he seems to be determine to the create some kind of special relationship with Vladimir Putin and with Russia in the face of enormous evidence of the contrary, that this is not a man or regime that's in step with American values or American foreign policies.

PAUL: Sara, I want to move on to Obamacare here really quickly because Paul Ryan says that Republicans will repeal and replace Obamacare simultaneously. Let's take a listen here to what he has to say.

(BEGIN VIDEO CLIP)

REP. PAUL RYAN (R-WI), SPEAKER OF THE HOUSE: There are good objectives that they sought to achieve in this law. We agree with that. We think, young people -- you should be able to stay on your parents' plan until you're 26. We think there needs to be a solution which we have for people with preexisting conditions. But we want more choices, lower prices, more competition, no monopolies. That's what we want to replace it with, and that's what we're working on right now.

(END VIDEO CLIP)

PAUL: Is there any indication the detail, this new plan, this replacement would be, and how expeditiously it can be brought out? SARAH WESTWOOD, WHITE HOUSE CORRESPONDENT, WASHINGTON EXAMINER: The

problem for congressional Republicans is not that they don't have the health care plan. It's that they have too many plans. And they haven't come to a consensus as to which reforms they should piece together into one overarching replacement for Obamacare.

And then once they reach that consensus, they are still facing a number of other dilemmas. First is, do they replace it all in one bill, similarly to the way Obamacare was pushed through in one giant piece of legislation? Do they replace it in a bunch of smaller bills and then risk having to wage a bunch of different smaller fights, but that way, there's more discussion and more time to arrive at a consensus on all of those components of Obamacare?

And the biggest problem they're facing is, how do they prevent insurance companies from discriminating against people with preexisting conditions once you repeal the individual mandate that's at the heart of Obamacare? There's not a clear path forward there. And Trump has led the charge in saying, we're not going to kick people off their plans if they have insurance. But a fundamental change to Obamacare does put that at risk.

PAUL: Yes, saying something and trying to figure out how to implement are oftentimes two different things.

Errol, let me talk to you about what we're learning about John Lewis this morning, questioning Donald Trump legitimacy as president. Let's listen together here.

(BEGIN VIDEO CLIP)

REP. JOHN LEWIS (D), GEORGIA: I don't see the president-elect as a legitimate president.

CHUCK TODD, MEET THE PRESS: You do not consider him a legitimate president. Why is that?

LEWIS: I think the Russians participated in helping this man get elected.

(END VIDEO CLIP)

PAUL: So, he is citing, Errol, Russian hacking, derailing the Hillary Clinton campaign. And that's why he doesn't see this presidency as legitimate. Is that valid reasoning? Or was it responsible to come and delegitimize this presidency?

[07:10:02] LOUIS: Well, I wouldn't question John Lewis about almost anything related to democracy since he made it possible for me and others like me to have a vote in the first place. I would suggest that if John Lewis has more information than the rest of us, he should share it with all of us.

But if he is simply saying that based on what he knows that all of us know, he just doesn't think that this is something that he can participate in, I think you'll find that there are a lot of people who feel that way, to tell you the truth. I mean, we follow a lot of this stuff, Christi, and I -- my understanding of the Electoral College system and having followed this from start to finish, I don't think that whatever went on with the Russians that we know about so far made the difference in those three crucial states in Wisconsin, and in Michigan and in Wisconsin.

On the other hand, John Lewis may have reached an entirely different conclusion and he's certainly entitled to do that.

PAUL: But because there's not a definitive investigatory conclusion into whether Russia did have an impact on the presidential election, Sarah, was this a responsible statement to make?

WESTWOOD: Well, look, this plays into exactly what President-elect Donald Trump has been saying, which is that the Russian hacking could be used to delegitimize his victory. And some Republicans and Democrats have been trying to get him to accept the reality that Russians hacked the Democrats by saying nobody is trying to delegitimize your election, we're just trying to highlight the fact that there were some troubling cyberattacks on American citizens. Now, that you do have the first Democrat coming out and saying that potentially, there needs to be this questioning of whether Donald Trump's victory was legitimate, it sort of validates what Donald Trump was saying all along about the fact that this is how the Russian hacking situation was going to be politicized.

PAUL: All right. Errol Louis, Sarah Westwood, I appreciate both of you taking the time to be with us. Thank you.

LOUIS: Thank you.

PAUL: And Monday, CNN has a special report that we want to let you know about. It's called, "First Daughter: Ivanka Trump". We're going to take a look at Ivanka's influence, her influence on fashion, on business, now on Washington. That's Monday at 9:00 p.m. Eastern, right here on CNN.

Tension building between Democrats and FBI Director James Comey after a tense House briefing on Russian hacking.

BLACKWELL: The outrage has sparked a call for Comey's resignation. More on that ahead.

And the government's ethics watchdog is sounding the alarm over Donald Trump's plan to avoid conflicts of interest. Why he says Trump's plans to give his business to his sons is, quote, "wholly inadequate."

PAUL: Also, a cold case is finally cracked. Can you can believe this -- a newborn baby kidnapped 18 years ago found alive. Her family's reaction and where they go from here.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

[07:15:39] UNIDENTIFIED FEMALE: It's classified and we can't tell you anything. All I can tell you is the FBI director has no credibility.

UNIDENTIFIED MALE: Jim Comey is an honorable person who I think made a bad decision.

UNIDENTIFIED MALE: When the director of the FBI can't answer those questions, it does shake our confidence.

(END VIDEO CLIP)

BLACKWELL: The Democrats there outraged with FBI Director James Comey after this confidential briefing on the Russian hacking. Former DNC Chairwoman Debbie Wasserman Schultz, who was forced to resign over this hacking, engaged in a heated exchange with the FBI director, claiming he did not do enough to inform her.

PAUL: In the meantime, "The Wall Street Journal" is calling for Comey to resign. This is their quote, "The new AG should ask the director to resign for the good of the FBI."

BLACKWELL: So, what's the future here for James Comey? Are his days numbered at that post?

Let's bring in CNN senior law enforcement analyst and former FBI Assistant Director Tom Fuentes.

Tom, good morning to you.

TOM FUENTES, CNN SENIOR LAW ENFORCEMENT ANALYST: Good morning, Victor.

BLACKWELL: So, is this just a short-lived outrage? We've seen it from both sides after he declined to file charges against Hillary Clinton back in July, Republicans were outraged. Now, we're seeing it from the Democrats. Do you think they'll be able to weather the storm? Or, should he resign?

FUENTES: Well, I think the question is, you know, do we want FBI directors to resign strictly because of political pressure, even before any investigation is conducted into how he conducted his business and how he directed the decision-making from the FBI?

So, that's the reason why Congress passed the law and the president signed that the FBI director is the only leader of an executive branch agency that does not serve strictly at the pleasure of the president. His term does not expire when the president's term expires. He has a ten-year term. That's why to keep politics out of it.

Now, unfortunately, the director helped become in the middle of this political firestorm with his July 5th announcement that he was now recommending charges. And I think -- but part of that blame has to go back to the attorney general, days before after the encounter with Bill Clinton on the attorney general's airplane, when she said, "I will go with the recommendation of the FBI."

And I've said before and I'll say again, "On July 5th, the director's only announcement should have been, we've completed our investigation and we've submitted the results to the Department of Justice, for the department to decide whether or not to prosecute." And I don't care if the janitor at DOJ made the decision. It should have been made at DOJ, not publicly made by the FBI director.

And I think that was the beginning of the slippery slope of political contentiousness that went on throughout the rest of the summer. And all the way up to and including the election.

BLACKWELL: There are many who agree with you that he should not have gone into the carelessness of the use of the server and confidential information. Democrats also questioned the announcement 11 days before the election of opening up this investigation into looking into what was on Anthony Weiner's laptop, and then, several days before the election saying there's nothing new there.

There is this exchange between James Comey when he testified before the Senate Intelligence Committee and Senator Angus King, and his refusal to confirm there's an ongoing investigation. Listen to this exchange.

(BEGIN VIDEO CLIP)

SEN. ANGUS KING (I), MAINE: Mr. Comey, did you answer Senator Wyden's question that there is an investigation underway as to connections between either the political campaigns and the Russian -- Russians?

JAMES COMEY, FBI DIRCTOR: I didn't say one way or another.

KING: You didn't say --

COMEY: That was my intention at least.

KING: You didn't say one way or another, whether even there's an investigation underway.

COMEY: Correct, I don't -- especially in a public forum, we never confirm or deny a pending investigation.

KING: The irony --

COMEY: I'm not saying --

KING: The irony of your making that statement here, I cannot avoid, but I'll move on.

(END VIDEO CLIP)

BLACKWELL: So what position has he placed himself in now, now with that precedent of the July 5th announcement?

FUENTES: Well, you know, the difference is July 5th, he's saying we recommend no charges. Shortly thereafter, the attorney general says the case is closed, not only against Hillary Clinton but her assistants and everyone else that was the subject of that investigation. So, once that was officially disclosed, the FBI can discuss, at least, you know, in testifying before congress, the nature of the information and many of the aspects of the investigation.

[07:20:10] It's now a closed case, not a pending one. So, that's standard to say we're not going to talk about a pending case. I think that's what's caused so much consternation here. But, you know, the investigation now by the inspector general's office, which is an independent agency, it's not directly related to the FBI, you know, that's libel to disclose that she should have been prosecuted.

You know, there's -- I think the Democrats have to a little bit careful for what they wish for here, because to go back and relitigate the entire investigation and Comey's final decision with recommendations not to prosecute, that might be something they don't want this to be brought up again. Basically, you know, looking into the details of it. And especially, if they look at the Department of Justice and the FBI interaction, did the Department of Justice officials make decisions that basically held back the FBI from using many of the investigative techniques that are normal in a complex, difficult investigation, including grand juries, including which search warrants were issued, the use of immunities.

BLACKWELL: Yes.

FUENTES: There were a lot of things that led up to it. Director Comey may have been exactly right on July 5th that there wasn't enough evidence. The next question becomes, is the FBI somehow obstructed in really obtaining the evidence that would have led to a prosecution.

So, this is a very tricky situation to reopen and re-talk about. And it may not be fallout against the FBI by the time this is over.

BLACKWELL: And we know that there's a process beginning for the attorney general there at the DOJ, the FBI's handling of this investigation.

Tom Fuentes, always good to have you.

FUENTES: Thank you, Victor.

BLACKWELL: Christi?

PAUL: A baby girl kidnapped from the hospital. Now 18 years later, she discovers her true identity. It is a fascinating story. We'll bring you that next.

(COMMERCIAL BREAK)

PAUL: I'm going to forewarn you, this is a disturbing story that we have to tell you this morning. This is out of Utah. A mother is accused of locking her son in a bathroom for more than a year.

[07:25:02] BLACKWELL: Yes, this boy's father found him trapped inside earlier this week and rushed him to a hospital. Doctors say the boy weighs 30 pounds. Police described the scene was one of the worst they've seen.

(BEGIN VIDEO CLIP) LT. DAVID CROUSE, WASHINGTON COUNTY SHERIFF'S OFFICE: The light switches were in the off position, not only in the off position, but they've been secured with duct tape to ensure that the individual in the dark in that room would not be capable of turning on the lights. I've seen the photos and honestly, I wish I could unsee them.

(END VIDEO CLIP)

BLACKWELL: The doctors say the boy will be in the hospital for at least three weeks to get his weight up. Get him healthy again. His mother is charged with child abuse.

PAUL: All right. Let's get to a cold case that is finally solved after 18 years. These are the kinds of things you think can't happen. And this is vindication that yes, they can.

Kamiyah Mobley was just hours old when she was kidnapped back in 1988. This is a rendering of what she would have looked like at 6 hours old. The woman you're looking at here is accused of posing as a nurse and stealing her from the hospital.

BLACKWELL: And now, a family in Florida is learning that the baby they lost so many years ago is now a teenager living under a different name in South Carolina.

Polo Sandoval is here with more.

And this is just remarkable that this girl now is learning that the mother she thought was her biological mother is potentially a woman who stole her.

POLO SANDOVAL, CNN CORRESPONDENT: Right, the person involved in her kidnapping. At this point, we do understand that Kamiyah Mobley able to speak to her father's family, which you're about to hear in a few months. But, first, Jacksonville sheriff did say Kamiyah Mobley had at least an inkling perhaps that she was a victim of a kidnapping just months before she got that knock on the door that changed her life.

(BEGIN VIDEOTAPE)

VELMA AIKEN, GRANDMOTHER: I always thought it would happen one day. But I didn't have no idea that it was going to be this day.

SANDOVAL (voice-over): Velma Aiken's prayers were finally answered. The disappearance of her granddaughter Kamiyah Mobley captured the attention of the country the summer of 1998. She was just a few hours old when a woman dressed as a nurse walked out of a Florida hospital with her, leaving behind no trace and a heartbroken young mother.

UNIDENTIFIED FEMALE: I'll be the happiest in the world to hold my baby.

SANDOVAL: The exhaustive search turned up some clues but no baby Kamiyah.

UNIDENTIFIED MALE: OK, y'all have a good day. Thank you. SANDOVAL: Eighteen years, and nearly 2,500 tips later, the

Jacksonville sheriff's office received the tips they needed. Investigators were led to the tiny town of Walterboro, South Carolina.

SHERIFF MIKE WILLIAMS, JACKSONVILLE, FLORIDA: We found an 18-year-old woman same date of birth but a different name. Further investigation revealed that fraudulent documents had been used to establish that young woman's identity.

SANDOVAL: Sheriff Mike Williams says DNA analysis confirms that the 18-year-old woman in Walterboro is Baby Kamiyah.

WILLIAMS: In the interest of reducing any further trauma to this young woman, I am not revealing her name. The name she's lived under for all these years.

SANDOVAL: Gloria Williams, the woman believed to have raised baby Kamiyah was arrested Friday and charged with kidnapping.

A neighbor of the 51-year-old tells CNN, Williams and the girl she raised seem to have a normal mother/daughter relationship. Today, the young woman faces a new reality, being away from the only mother she ever now.

(END VIDEOTAPE)

SANDOVAL: Some pictures coming out of South Carolina there yesterday. Gloria Williams does remain behind bars this morning. We're told she did take part in a bond hearing yesterday morning, Victor and Christi. At this point, she hasn't denied bond but she will be eventually be extradited to Jacksonville to face these kidnapping charges.

PAUL: And Kamiyah, you said, is still there?

SANDOVAL: That's what we understand right now, that she's still at home in South Carolina. But the question is how soon, or if she'll be reunited with her family. Her biological family awaits in Jacksonville. They have been waiting and praying for 18 years. And then, this week, that DNA confirmed, that DNA tests confirming what they were expecting.

PAUL: Wow.

All right. And you say reports show that she was potentially --

SANDOVAL: By all accounts, she was a good mom as well.

BLACKWELL: Yes.

PAUL: Wow. That's going to give pause, I guess, to the real mother.

BLACKWELL: Yes.

PAUL: You have so many horrible things going on in your mind.

BLACKWELL: I'm sure we'll hear from her. PAUL: Yes, we will. At some point, yes.

Thank you so much, Polo. Appreciate it.

BLACKWELL: The government's ethics watchdog, he's watching Donald Trump, saying his plans to block conflicts of interest doesn't go far enough.

(COMMERCIAL BREAK)

[07:31:52] CHRISTI PAUL, CNN ANCHOR: So grateful to have you with us, 7:31 on a Saturday morning. I'm Christi Paul.

VICTOR BLACKWELL, CNN ANCHOR: I'm Victor Blackwell. Great for you to say your name, I was trying to get mine.

(LAUGHTER)

PAUL: I apologize.

BLACKWELL: All right. Just a few hours from now, thousands of people expected to gather in Washington. One of several marches across the country in support of immigration and civil rights as part of the #heretostaymovement.

PAUL: Yes. There's less than a week before Donald Trump is sworn in as president officially. In a new interview with "The Wall Street Journal", the president-elect says he's open to lifting sanctions against Russia if they can work together towards common goals, such as fighting terrorism. President-elect Trump also adding that he'd be willing to leave current sanctions in place, quote, "for a period of time".

BLACKWELL: Earlier this week, the president-elect and his attorneys laid out a plan to put aside any conflicts of interest. But a government watchdog says they just do not go far enough.

Cristina Alesci is following the story for us.

(BEGIN VIDEOTAPE)

CRISTINA ALESCI, CNN MONEY CORRESPONDENT: Christi, Victor, Trump's plans to address conflicts has several parts. One, his sons will run the business. Two, they won't strike any new foreign deals. And three, new U.S. deals will be need to vetted by an ethics lawyer.

But all of that fails the ethics test, according to the Office of Government Ethics. It slammed the plan this week. The reason: Trump is still keeping ownership.

DONALD TRUMP (R), PRESIDENT-ELECT: Actually run my business and run government at the same time.

ALESCI (voice-over): Donald Trump resigning from his business empire, but not selling it. Instead, he'll transfer control to his sons.

TRUMP: Don and Eric are going to be running the company.

ALESCI: Legal experts say the plan falls short.

RICHARD PAINTER, FORMER ETHICS ADVISER TO GEORGE W. BUSH: He has ownership interests in the businesses that profits and the businesses go to him. And all of the conflicts of the interest remain intact.

ALESCI: Intact, because Trump will still know what his holdings are. And that could impact the decisions he makes as president.

The Office of Government Ethics slammed Trump's plan.

WALTER SHAUB, JR., DIRECTOR, OFFICE OF GOVERNMENT ETHICS: Stepping back from running his positions is meaningless from a conflicts of interest perspective.

ALESCI: For months, experts have been calling on Trump to sell his assets and put them in a blind trust. But Trump's attorneys say that wouldn't work.

SHERRI DILLON, LAWYER TO DONALD TRUMP: You cannot have a totally blind trust with operating businesses. President Trump can't unknow he owns Trump Tower.

ALESCI: Instead, the Trump Organization is pledging it won't do any new deals in foreign countries. And any domestic deals that could raise eyebrows will be vetted by a newly appointed ethics officer. Trump's sons, Don Jr. and Eric, will run the business, along with Trump Organization CFO Allen Weisselberg who's been there since the 1980s, even appearing on "The Apprentice".

ALLEN WEISSELBERG, TRUMP ORGANIZATION CEO: I thought that Andy losing his lines of communications was very serious matter.

ALESCI: Trump's relationship to all of them creates its own issues.

NORM EISEN, FORMER ETHICS ADVISER TO BARACK OBAMA: Everyone is going to know, when they're doing business with Eric or Don Jr., they're doing business with the president.

SEN. ELIZABETH WARREN (D), MASSACHUSETTS: He risks losing the trust of all of the people of the United States, who are counting on him to be able to separate himself from his business interests.

[07:35:07] ALESCI: Trump isn't exactly turning his back on his business either. He'll still receive profit and loss reports on the companies as a whole, even as his sons run the day-to-day operations.

TRUMP: I hope at the end of eight years, I'll come back and say, oh, you did a good job. Otherwise, if they do a bad job, I'll say "You're fired." Good-bye, everybody.

ALESCI (on camera): Well, Trump's team and his lawyers say forcing him to divest is unreasonable. But the federal Office of Government Ethics doesn't think so. The head of the agency said he wished Trump's legal team consulted him because the agency would have reassured them presidential nominees in every administration agree to sell assets all the time -- Victor, Christi.

(END VIDEOTAPE)

PAUL: All righty. Cristina Alesci, thank you so much.

Let's bring in criminal defense attorney Page Pate to walk us through this. So, help us understand. Give us some clarity on the legal spectrum of this. What is the responsibility of President-elect Trump when he's dealing with both of these entities?

PAGE PATE, CRIMINAL DEFENSE ATTORNEY: We've never had a situation where the president walks into office more concerned about what's illegal or legal versus what's ethical or not. There are not really any clear laws that prohibit Trump from being engaged in business while he's president.

There's a federal law that does not cover the president or the vice president. There's a constitutional provision, but it's really fuzzy as to whether or not it prevents somebody like a President Trump, from being engaged in private business. Now, it's clear he can't do anything to receive any benefits or get business from a foreign country. But it really doesn't address private business interests. So, there's no clear law that prohibits him from doing what he's doing.

PAUL: Is there any way to ensure that he didn't personally profit from any of his businesses he makes?

PATE: I think the only way to do that is to have Congress address this proactively. Go in, pass a law, make it clear that conflict of interest laws that currently govern almost everybody else in the executive branch also covers President Trump. Because right now, that law is not on the books.

PAUL: OK. Elizabeth Warren had something to say about this during a hearing this week. Let's listen.

(BEGIN VIDEO CLIP)

WARREN: The problem is that you can't assure that HUD money, not of ten dollar varieties, but of multimillion-dollar varieties, will not end up in the president-elect's pockets, and the reason you can't assure us of that is because the president-elect is hiding his family's business interests from you, from me, from the rest of America.

(END VIDEO CLIP)

PAUL: Is there validity to the allegations she's making? And how he's able to hide assets?

PATE: There's a lot of validity to what she's saying. And I think President Trump could avoid all this by taking his assets, liquidating them, and putting them in blind trusts. That is what every president in modern history has done. But from Trump's standpoint, and I guess elections have consequences, he's coming into office with the idea that if it's legal, I'm going to do it. So, that's the problem.

PAUL: Walter Shaub, the director of the Office of Government Ethics, gave a speech at Brookings Institute this week and here's what he said, talking about, kind of imploring, apparently, the president- elect, to look at sacrifice. Let's listen.

(BEGIN VIDEO CLIP)

WALTER SHAUB, DIRECTOR, GOVERNMENT OFFICE OF ETHICS: As we all know, one of the great things about America is its system for preventing public corruption. The president-elect must show those in government and those coming into government after his inauguration that ethics matters.

(END VIDEO CLIP)

PAUL: Is that law, that, you know, the president and conflicts of that statutes, is it outdated? Does it work? Does it change with each president?

PATE: It shouldn't. I mean, there should be one clear law and it governs every person that takes that office. We did not need a law before Trump to tell a president that you can't have a business conflict of interest while you're in office. Every president in modern time has made it clear I'm going to separate my personal interests from my responsibilities to the country. And they've acted ethically.

And so, what the Office of Government Ethics is doing is trying to implore Trump before he becomes president, to take those steps, because, otherwise, there's nothing to govern his private conduct and whether or not there's going to be a conflict with the people's business.

PAUL: And if he doesn't do that, if he does not put in a blind trust, what -- how confident are you that this is going to be a potentially huge distraction?

PATE: All during his presidency. Unless Congress doesn't proactively changes that law to make sure that it covers a president and a vice president. Otherwise, we're going to be talking about this as long as he is in office.

PAUL: All righty. Page Pate, always appreciate your expertise.

PATE: Thank you, Christi.

PAUL: Thank you so much.

Victor?

BLACKWELL: Michelle Obama started as first lady trying to really find her footing in that role. Next, a look at how she transformed herself into one of the most powerful forces in the Democratic Party.

(COMMERCIAL BREAK) (BEGIN VIDEO CLIP)

[07:42:57] MICHELLE OBAMA, FIRST LADY: It's definitely bittersweet. I mean, everything is like the last, you know? And I find myself choking up because we have raised our kids in the White House. We've had so many amazing experiences. We have phenomenal staff. We live in a house with people who love us and care about us. And, you know, we're going to be walking away from all of that.

(END VIDEO CLIP)

PAUL: No doubt, transition there. She says it's hard to leave.

In the beginning, though, Michelle Obama had said she didn't really take to the role of first lady.

BLACKWELL: Yes, it was tough for her. But then she found her footing and became really a powerful political voice.

Here's CNN White House correspondent Michelle Kosinski.

(BEGIN VIDEOTAPE)

OBAMA: As I end my time in the White House, I can think of no better message to send to our young people. Something that carried us through every moment in this White House and every moment of our lives and that is the power of hope. The belief that something better is always possible, if you're willing to work for it and fight for it. It is our fundamental belief in the power of hope that has allowed us to rise above the voices of doubt and division of anger and fear that we have faced in our own lives and in the life of this country.

MICHELLE KOSINSKI, CNN WHITE HOUSE CORRESPONDENT (voice-over): In a crowd of educators, advocates, school counselors, the first lady took this opportunity to speak to America's youth about America's values, and as someone who over eight years has emerged as one of the most powerful voices for Democrats.

From her emotional speech at the convention last year --

OBAMA: I wake up every morning in a house that was built by slaves. And I watch my daughters, two beautiful intelligent black young women, playing with their dog on the White House lawn.

[07:45:03] KOSINSKI: To her surprising words just days ago with Oprah Winfrey.

OBAMA: See, now, we're feeling like what not having hope feels like.

KOSINSKI: Here, she didn't miss a chance to once again hit out at the kind of rhetoric she had said defined the Trump campaign.

OBAMA: If you or your parents are immigrants, know that you are part of a proud American tradition. And whether you are Muslim, Christian, Jewish, Hindu, Sikh, these religions are teaching our young people about justice and compassion and honesty. You see, our glory is diversity. Our diversities of faiths and colors and creeds, that is not a threat to who we are. It makes us who we are.

KOSINSKI: Noting, too, that it comes to responsibility, half of those people that she's speaking to didn't vote at all.

OBAMA: You cannot take your freedoms for granted. Empower yourself with a good education. And then, get out there and use that education to build a county worthy of your boundless prowess, lead by example, with hope, never fear, and know that I will be with you, rooting for you and working to support you for the rest of my life.

And I am so grateful to all of you for your passion and your dedication and all of the hard work on behalf of our next generation. And I can think of no better way to end my time as first lady than celebrating with all of you. So, I want to close today by simply saying thank you.

Thank you for everything that you do to our kids and for our country. Being your first lady has been the greatest honor of my life. And I hope I've made you proud.

KOSINSKI (on camera): So, does this mean that the first lady has come to embrace the public eye, and just loves hanging out with and getting to know the press? No. She doesn't do interviews all that often. Her staff is extremely protective of her and selective of what she does and when.

Post-White House, we expect first a vacation. The first couple has said many times now that that is badly needed. And they'll settle into their rented house here in D.C. where they'll stay for a couple years until Sasha finishes high school.

We expect the first lady to keep working on issues she believes in, although she has insisted several times now that she will not run for public office -- Christi and Victor.

(END VIDEOTAPE)

PAUL: Michelle Kosinski, thank you so much.

So, what exactly does it mean when she says I will be with you? The writer who would be covering Michelle Obama for several years has insight for us. He's next. Stay close.

(COMMERCIAL BREAK)

[07:50:21] PAUL: Well, Michelle Obama says she's ready to leave after eight years in the White House. There are so many people that will be sorry to see the popular first lady go, however. And I want to talk about her with Tina Nguyen. She's a writer for the Hive at vanityfair.com, covered the first lady several years.

So, Tina, I'm wondering what is your lasting impression of her? When you think about Michelle Obama, what's the first thing comes to your mind as we move forward?

TINA NGUYEN, WRITER, THE HIVE: Grace and intelligence for sure. She was a first lady with a storied career before she moved into the White House. I believe she was a hospital administrator back in Chicago and with a Harvard law degree.

And when she moved into the White House, she took a role that is traditionally very passive and a bit -- doesn't have a lot of policy influence. And she took it and turned it into a platform that both married her role as mother of two young women and a woman who is -- two young girls, and a woman passionate about making America a better place. And she found her niche in focusing on childhood obesity and healthy eating, which is a problem that is facing millions of Americans today.

PAUL: Not only that, but a voice for women, a voice for young girls as they try to find their way in the world as well.

Let's listen to this moment that touched a lot of people, particularly, I think mothers of daughters. When she spoke last October after the tape came out of Donald Trump on the bus with "Access Hollywood" and he was talking about groping women, here's what Michelle Obama said in part to that.

(BEGIN VIDEO CLIP)

OBAMA: It's that feeling of terror and violation that too many women have felt when someone has grabbed them or forced himself on them and they've said, no, but he didn't listen. Something that we know happens on college campuses and countless other places every single day.

(END VIDEO CLIP)

PAUL: I mean, there is a real authenticity and emotion in that because you can tell that's coming straight from her, her most powerful voice we should point out. Is there any indication we're going to see more of that Michelle Obama in the future in some capacity?

NGUYEN: Absolutely. We're not quite sure exactly what her role will be as Michelle Kosinski reported earlier, but she has a platform and powerful moral authority that many other women in America can't match, not even Hillary Clinton.

I remember when she was speaking at the Democratic National Convention, they brought her out specifically to talk to mothers across the country and she gave a beautiful speech then where people thought she was quite -- where she should be running for president instead of Hillary. She won't be running for president any time soon much less any other public office, but she will try to leverage her platform in some way.

PAUL: Let's look at some of the more light hearted moments as well, because this is a woman who is thoughtful, and as intelligent as she is, she also has some communicability, let's say as well. Let's take a look.

(BEGIN VIDEO CLIP0 (SINGING)

UNIDENTIFIED MALE: Oh. I mean, Beyonce.

OBAMA: What can you say?

UIDENTIIFED MALE: We were close fully in the beehive right there.

OBAMA: We just dropped the mike.

Don't tell people about my rash.

ELLEN DEGENERES, TV HOST: What area are you telling me about?

OBAMA: My shoulder.

DEGENERES: Lower than that.

(MUSIC)

(END VIDEO CLIP)

PAUL: She's a unique first lady, no doubt about it. What do you believe her impact is going to be when they look back at her legacy?

NGUYEN: She managed to establish herself as a pop culture figure who is also intelligent, graceful and used her passion for public service to actually make a difference. She -- behind the woman who went on Jimmy Fallon to teach children how to -- hung out with Beyonce to teach children to dance and let's move, the name of her initiative, she also worked behind the scenes with dozens of food companies, fast food, beverage companies, to actually change the way they labeled their products, the way that they marketed products towards kids.

So, there's a dichotomy to her which is the public popular mother who's able to dance with children and the disciplined policymaker who really did put her stamp on the way that children grow up.

[07:55:08] PAUL: Tina Nguyen, thank you so much for that insight you brought us today.

NGUYEN: Thank you for having me.

PAUL: Sure.

We do want to mention CNN special report tonight. Our Fareed Zakaria talking with President Obama about the triumphs, about struggles he found during his time in the White House. "The Legacy of Barack Obama", it's tonight at 8:00 p.m. Eastern right here on CNN.

Victor?

BLACKWELL: All right. Up next, revenge rematches. Andy Scholes is looking ahead to this weekend's NFL playoffs.

ANDY SCHOLES, CNN SPORTS CORRESPONDENT: Yes, Victor, we have the Texans and Patriots and Seahawks at the Falcons. Will the home favorites to win or will see an upset later today?

(COMMERCIAL BREAK)

BLACKWELL: All right. NFL playoffs continue today. Tom Brady, Patriots, hitting the field in what most think should be pretty easy for the Patriots over the Texans, at least.

PAUL: Andy Scholes has more on this morning's bleacher report.

BLACKWELL: That so great for the Texans --

PAUL: I mean, the Texans --

SCHOLES: Yes, I'm a Texan fan. So, unfortunately, for me, the outlook isn't great.

PAUL: Really?

SCHOLES: Maybe we will shock the world tonight. Texans, two touchdown underdogs against the Patriots. Texans play well against the Patriots on prime time television. This is a rematch we saw third week of regular season. In that game, the Patriots won, 27-0. Tom Brady didn't even play, he was still on deflate-gate suspension.

This is a teacher versus student matchup. You've got Texans head coach Bill O'Brien who worked for Bill Belichick on Patriots staff. Hopefully, the Texans can make it a game.

Now, the other playoff matchup from earlier season, between Falcons and Seahawks. Seattle won that in a close one over Atlanta. That was at home for the Seahawks. Today's game in Atlanta. Seahawks trying to get to the Super Bowl third time in four years. Kickoff at 4:45 Eastern and the Patriots and Texans are going to hit the field in the night cab. It's going to cold at kickoff. Temperature at 18 degrees.

All right. This next story makes people -- Bo Jackson wishes he never played football. Jackson, of course, won the Heisman Trophy for Auburn, the only player to ever make the NFL Pro-bowl and Major League Baseball all-star game. He retired from football in 1991 after that serious hip injury. And he told "USA Today", quote, "If I knew back then what I know now, I would have never played football. Never."