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Lawsuit Cites First Lady's Earning Opportunities; Trump Falsely Accuses Media Of Not Reporting Terror; Trump Falsely Claims Murder Rate Is Highest In 47 Years; Soon: Oral Arguments In WH Travel Ban, Conflict in Ukraine; Republicans and Obamacare; Interview With Trump Senior Adviser Kellyanne Conway. Aired 4:30-5 p ET

Aired February 7, 2017 - 16:30   ET



KELLYANNE CONWAY, TRUMP SENIOR ADVISER: This is the part where I'm talking about complete coverage.

That was just an amazing -- some of those sheriffs, it was -- we -- we allowed the media in there the entire time. It was the president's idea. He even invited the media into the Oval Office while the sheriffs came in there to take some pictures.

But at the actual listening roundtable, which was the most important piece of this, we heard from sheriffs who said they sat in those exact seats six months ago in a different administration and they felt this time there was a president who actually asked them, what do you need? What is rankling you in your communities?

And we heard to a person everything from asset forfeiture to opiate use, probably the most commonly stated theme, which, of course, I'm happy to have a piece of that in my portfolio here.

We're going to be rolling that out very soon. It's something the president made a centerpiece of his campaign. He's greatly concerned about it. We will be working with law enforcement, people on both sides of the aisle, families who have victims, who talk about issues that...

JAKE TAPPER, CNN ANCHOR: I would love to cover all of that, Kellyanne.

CONWAY: Thank you.

TAPPER: I would love to cover all of that.

The attacks on the press, the attacks on judges, the falsehoods, all that makes it very difficult. But I would love to cover all of that with you.

CONWAY: Thank you.

TAPPER: Kellyanne Conway, thank you so much for your time. We really appreciate it.

CONWAY: Thanks, Jake.

TAPPER: Just a few months ago, then candidate President Trump promised to repeal and replace Obamacare -- quote -- "very quickly." But are Republicans in Congress on the same timeline?

That story next.



TAPPER: Welcome back to the lead.

Sticking with politics, Betsy DeVos is now the new secretary of education thanks to a historic tie-breaking vote by Vice President Mike Pence to approve her confirmation.

Until today, no vice president had ever been needed to break a Senate tie to confirm a Cabinet nominee.

Tomorrow, we're expected to get the up-or-down vote on Senator Jeff Sessions for attorney general. Also today on the Hill, questions about how long it will take to repeal and replace Obamacare.

First, a reminder of President Trump's campaign promise.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Obamacare has to be replaced. And we will do it, and we will do it very, very quickly.


TAPPER: That was November. Fast forward three months. Today, House Speaker Paul Ryan insisted legislation will be finished this year but he acknowledged implementation might take longer.

We heard this timeline first from President Trump over the weekend, but now fellow Republicans are beginning to question how quickly a vote on that legislation might even happen.

Let's bring in CNN correspondent, congressional correspondent Phil Mattingly.

Phil, Paul Ryan says that committees are already working on proposals. Can he get a vote as soon as he's hoping?

PHIL MATTINGLY, CNN CORRESPONDENT: It looks like on a piece of it, yes. But here's the rub, Jake. This is a multistep process. There are many pieces of the process that GOP leaders have planned out right now. Those pieces take time, time that a lot of Republicans say they don't have both on the political side and on the policy side.


MATTINGLY (voice-over): On Capitol Hill, a cold reality. Bold campaign promises.

TRUMP: It will be repeal and replace. It will be essentially simultaneously. Could be the same hour.

MATTINGLY: Now giving way to the legislative slog.

SEN. ORRIN HATCH (R), UTAH: A more complete replacement can and should be crafted in the coming months, as we work through some of the more complicated issues.

REP. PAUL RYAN (R-WI), SPEAKER OF THE HOUSE: We're going to do this step-by-step and do this right.

MATTINGLY: Even the president seemed to grasp the new state of play.

TRUMP: It statutorily takes a while to get. We're going to be putting it in fairly soon. I think that, yes, I would like to say by the end of the year, at least the rudiments, but we should have something within the year and the following year.

MATTINGLY: GOP leaders and aides insist this was always the idea. A single 1,000-page replacement bill on par with the Affordable Care Act was never in the cards.

RYAN: The good news is we actually ran on a plan to replace Obamacare. And now our committees are in the midst of actually putting that plan together.

MATTINGLY: The ostensibly varying timelines have led to confusion, whether semantic.

RYAN: I would say there is just a miscommunication or a misinterpretation of what we're trying to say.

MATTINGLY: Or otherwise after years of united GOP opposition, the slow-going process has opened lawmakers to another potentially devastating charge, that they simply have no plan at all.

REP. FRANK PALLONE (D), NEW JERSEY: Every day, their timeline changes and all they have successfully done so far is create chaos and uncertainty among patients and insurance companies.

MATTINGLY: Or, perhaps worse, they're leaving open the possibility of thousands losing their insurance if the repeal comes long before the replace.

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: I have seen speed. I have seen partisan results. It's called Obamacare. I don't want to go down that road.

MATTINGLY: And some Republicans keenly aware of their campaign promises are already growing weary of those lengthy timelines.

SEN. TED CRUZ (R), TEXAS: I think we need to move as expeditiously as possible. This was a promise made to the American people and we need to deliver on that promise. MATTINGLY: The powerful conservative group the Heritage Foundation, a

group with close ties and personnel and policy to the Trump White House, hosting a forum on Wednesday, not so subtly titled "Congress Must Repeal Obamacare Immediately."

That process, aides tell CNN, is not only unlikely, but likely impossible. That, they say, means one thing. Prepare for a long, hard year ahead.

RYAN: We are going to be done legislating with respect to health care and Obamacare this year.


MATTINGLY: And, Jake, that's a timeline that just for some conservative Republicans just doesn't work right now. It's not just because there is frustration on the policy side. The politics here matter and they really have to answer to constituents.

They ran on these issues, and here is what they're hearing back home, town halls being overrun by protesters about specific issues. They now feel like they have to deliver. And what's happening inside behind closed doors, this morning in a private Republican conference meeting, they are so wary of what's happening in those town halls, they actually had to discuss safety precautions.

That's where this debate is headed. That's why you see certain segments of the party want to move quickly, despite the reality that it just doesn't seem possible at this moment, Jake.

TAPPER: Town halls, I remember that, except it was Democrats that were afraid of them. Phil Mattingly, thank you so much.

Tonight, Senators Ted Cruz and Bernie Sanders debate the future of Obamacare right here only on CNN. CNN's Dana Bash and I will moderate the debate. It all starts tonight at 9:00 p.m. Eastern.


Turning to something else certainly on the minds of members of Congress, our world lead, the violence unfolding in Eastern Ukraine. More casualties on both sides in the past 24 hours, as forces loyal to Vladimir Putin have stepped up attacks in the last week or so.

It seems like a pretty basic cut-and-dry issue on which the U.S. president should pick a side, but we didn't quite get Mr. Gorbachev, tear down this wall, when Bill O'Reilly asked Mr. Trump about it.


BILL O'REILLY, FOX NEWS: Within 24 hours of you on the phone with the Russian leader, the pro-Russian forces step up the violence in Ukraine.


O'REILLY: Did you take that as an insult?

TRUMP: No, I didn't, because we don't really know exactly what that is. They're pro-forces. We don't know, are they uncontrollable, are they uncontrolled? That happens also. We're going to find out. I would be surprised, but we will see.


TAPPER: CNN's Phil Black has been on the front lines and joins us now live from Eastern Ukraine.

Phil, tell us what you're seeing.

PHIL BLACK, CNN CORRESPONDENT: Jake, at the front line, Ukrainian controlled town of Avdiivka, it's really the focus of the recent escalation.

We heard and saw constant bombardment through the afternoon, artillery fire flying in both directions.

Now, today both sides seem to say that they suffered relatively few military casualties. No losses on the Ukrainian side, only two fighters killed on the pro-Russian separatist side. If true, then those losses are relatively light given the intensity of what we were seeing.

Crucially, that artillery fire is no longer bombarding residential areas. That's what's been happening over the last week. It's why the civilian casualties have been so high. Huge numbers of artillery shells have been falling on and among people's homes. That has now stop stopped, but the fighting is still going on and it is intense, Jake.

TAPPER: And, Phil, you heard President Trump's remark to Bill O'Reilly about who is behind the violence. Today, the Pentagon, Mr. Trump's own Defense Department, seemed to contradict him.

BLACK: When Donald Trump says or suggests that Russia, Moscow is not controlling those pro-Russian fighters, he is repeating the Russian government line.

Moscow has said constantly that it is not a party to this conflict. The thing is, very few people actually believe that across Western governments, defense departments, intelligence agencies. There has been a consensus that Russia is arming, training and supporting those pro-Russian separatists.

And so, you're right. That is why the Pentagon today effectively contradicted the commander in chief when its spokesperson says that Russia has its fingerprints all over everything that is happening here in Eastern Ukraine, Jake.

TAPPER: Phil Black in Ukraine for us, thank you so much. And stay safe.

Conflict of interest watch -- what the White House is saying about new court documents that suggest that first lady, Melania Trump, planned to profit from her role as first lady.

Stay with us.


[16:45:00] JAKE TAPPER, CNN THE LEAD ANCHOR: Welcome back to THE LEAD, and today's "MONEY LEAD", the First Lady of the United States seeking a money-making opportunity perhaps as being the First Lady. That's part of our latest installment of "CONFLICT OF INTEREST WATCH". An attorney for Melania Trump has refiled a liable lawsuit against the owner of the Daily Mail which published a false story last summer about her, one that we will not repeat. In this new suit, the attorney claims that Melania Trump's temporary position as, "One of the most photographed women in the world," is a marketing opportunity worth millions, and adds that the article, the false article hurt Melania Trump's chances to launch a product line including shoes, jewelry, clothing, cosmetics, hair and skin care, and perfume. The suit is seeking $150 million in damages but does not specifically say that Melania Trump, the First Lady plans to capitalize on being first lady in the manner described. Today, a White House spokeswoman denied that the first lady intends to profit from her current position, despite that language used in the lawsuit. We have lots to digest and discuss with my panel right now. Bill, let me just start in with you, if you can put down your phone for a sec.

BILL KRISTOL, THE WEEKLY STANDARD EDITOR: I'm researching if your -- to make sure you were telling the truth.

TAPPER: I appreciate the fact-checking. So, I'm not going to ask you about Melania. I want -- I want to know what you think about the interview with Kellyanne Conway and the position she's in. Really not defending, but being forced today defend false statements made by the President of the United States.

KRISTOL: But as you say, not defending that's what actually I was looking at my phone. What did the president -- you asked her specifically about a very concrete statement the president made today, the murder rate is the highest it's been in 47 years.

TAPPER: Falsehood.

KRISTOL: Right, falsehood. He says in this interesting quote that I was looking at on my phone, he knows, he's said it before, he says, "I used to use that. I'd say that in a speech. Everybody was surprised because the press doesn't tell it like it is. Wasn't to their advantage to say that. But the murder rate is the highest it's been in, I guess, from 45 to 47 years." He was called on this repeatedly during the campaign.

TAPPER: Why would we want to cover up the murder rate?

KRISTOL: I don't' know. That's between you and your bosses. I'll leave that to you. You and Jeff Zucker can discuss this.

TAPPER: Obviously, it's not true. Obviously, it's not true.

KRISTOL: It's not true.

TAPPER: Right.

KRISTOL: The tiny truth is that the tick up in the murder rate which has gone down for the last 30 years was higher this year than any uptick in at least, I think 45 years. But he must know it's not true. It's evidently not true. He's been corrected on it, and he sort of relishes in the fact that he's been saying it over and over again. He said it today, and then Kellyanne Conway wouldn't defend it obviously, when she's on with you. But what situation are we in when the President of the United States repeats over and over again something that's just untrue.

TAPPER: Do you think he knows it's not true?

KIRSTEN POWERS, CNN POLITICAL ANALYST AND USA TODAY COLUMNIST: It's very hard to get to intent with people of knowing, you know, what they know and what they don't know. I'd like to think that he's not lying, that he somehow is getting bad information. But, you know, he does say a lot of things that aren't -- that are not accurate and then he's called out on it. And then you watch Kellyanne when you're asking her these questions, even the question about, you know, was he comparing the war in Iraq to Putin, which he clearly was.

[16:50:04] TAPPER: He obviously was.

POWERS: And she basically says, "No, he wasn't." And I was like, "But he was," you know, so I don't --

TAPPER: Well, they can put it to this translator where they say, how do I make this into an acceptable thing to say, an acceptable political argument? And then they just repeat something that is not even remotely what he said.

POWERS: Yes, exactly. And so, I think it's, you know -- or even when you ask the question about why hasn't he said anything about the attack in Quebec? And she doesn't - she went off -you know, she said something like he doesn't tweet about everything, which is I think a debatable comment. And, you know, but doesn't really answer the question. We never really got an answer to that. It is this very circular conversation, where in the end, you know, I don't feel like you really get a good answer.

TAPPER: You know, who noticed that he didn't - he hasn't said anything publicly about the attack in Quebec? Canada.

POWERS: Yes, of course.

TAPPER: Everybody in Canada has tweeted me, every single one of them. And they don't understand why it is. What do you think about the fact that she was like saying I want you to be covering these other things, this meeting with the sheriffs went well, we're going to do all this stuff with the opioid epidemic, et cetera. Why do you only cover the one negative thing?

KAREN TUMULTY, THE WASHINGTON POST NATIONAL POLITICAL CORRESPONDENT: I must say through the whole interview, I kept asking myself, "Am I dreaming this?" It was hard to follow any line of logic in any of her answers. And I think at this point, the most charitable read on this is that Kellyanne Conway is extremely exhausted. It showed in her face and it showed in her answers.

TAPPER: Well, we're all exhausted. Let's not pick on poor Kellyanne.

KRISTOL: Can I make one point out of this? I mean -

TAPPER: You know, you went back and forth on this a little bit.

KRISTOL: Well, the media base has made a lot of mistakes. The media has made more mistakes than usual in the last couple of months covering Donald Trump. Maybe out of a kind of exaggerated outrage that he was going to be president and now he's president. But still -- and you made this point, I'm thinking, kind of quickly, the media is the media. It makes mistakes. Other people in the media criticize the media. We all deserve to be criticized when we make mistakes. There's only one President of the United States. He has the entire U.S. government at his disposal to fact check things that he's going to say.

You've been covered White House, as I've served in the White House. You know how much trouble normal presidents go to and normal presidential staffs go to, to try to make sure the president doesn't make an error, or if he does that they correct it pretty quickly. And it matters. He's the President of the United States. It doesn't matter if one website somewhere misquotes Kellyanne or even frankly CNN gets something wrong for an hour before they correct it. It matters if the president does.

TUMULTY: Except that - except that in this case, the White House staff seems to be devoting itself not to correcting his errors, but to reinforcing his.

TAPPER: To doubling down.

POWERS: But I'm very curious of where she's caught with this idea about, you covered him one way when he was a candidate, now you're covering - you're not covering him differently because he's president. Where this idea that suddenly the media is supposed to shift and have a different kind of coverage because somebody is president. I think the coverage is the same. You cover the person as accurately and fairly as you can, and it's not like because they become president suddenly you start going easier on them or stop asking difficult questions. But Kellyanne seems to feel that that's what's supposed to happen and somehow the media has kind of let them down.

TUMULTY: Except that he's conducting his presidency exactly the way he conducted his campaign. Starting with, you know, 6:00 a.m. on Twitter. So, of course, it's going to be covered very much the way his campaign is covered.

POWERS: But she seems to think that because he's president, you know what I'm saying? That she said this repeatedly that they have -

TAPPER: He should have - he should be treated with more respect.

POWERS: That somehow the media is supposed to treat -- he's not being treated disrespectfully. People are just asking questions and, you know, I don't think there is a matter - it's a matter of disrespect.

KRISTOL: I think (INAUDIBLE) isn't it? I mean, normally we give candidates a certain running room, it's a campaign, they'll exaggerate, they'll put the best gloss on everything they've done or about to do. When you're president, you're president.



KRISTOL: -- you govern in -- you campaign in poetry and govern in prose. What it implied by that is that this is OK. Now, you're the President of the United States. You're not a republican candidate to compare.

TAPPER: I think she has a point in that the media is more aggressive, but I think that there's a good reason for it and it's exactly what you just said, the stakes are much higher. He's the President of the United States. A comment he makes about Boeing will affect Boeing's stock. A comment he makes about a judge, who knows what that -- could happen? A comment he makes trying to discredit the entire media could actually have an effect on some - on things. And when a president says something, it's much more important than a candidate.

POWERS: Or she seems to think we're supposed to show deference or something. That's a sense of -


TAPPER: Well, that's what Sebastian Gorka said earlier today. Did you see that quote?


POWERS: Yes, that signifies, but I'm not sure where she's gotten that idea, because that's not something that I've heard before.

TAPPER: Sebastian Gorka was -


KRISTOL: -- he seems to dismiss that Putin is a killer. You know, Putin is going around to somewhat in critical condition in Moscow right now (INAUDIBLE) in Russia, does Putin not draw consequences from Trump's dismissal of the notion we will hold (AUDIO GAP) Putin to account for killing others?

TUMUTLY: That the greater sin, though, was to - was to suggest there's a moral equivalency between the United States and what - and what Putin does. I mean, that is something that is -- you used to hear from leftist radicals in the 1970s, not from republican presidents in the 21st century.

[16:54:50] TAPPER: I mean, to equate what the Bush administration did and our soldiers did in Iraq, because he was talking about the killing, with Putin's thugs and the army is going in and seizing land in Georgia, seizing land in Ukraine, it boggles the mind. I can't imagine -- Bill, if President Obama had said that, you guys, The Weekly Standard would be putting out deluxe seven-volume sets on the issue.

KRISTOL: Right. Now, we have to do that for Donald Trump. Obama said plenty of things that were false and misleading and exaggerated, but this is a new level. Let's be honest. I mean, the moral equivalence is a new level and also the just flat out saying falsehoods and insisting on those (AUDIO GAP)

TAPPER: I don't mean to suggest that The Weekly Standard hasn't been calling him out. You certainly have. You certainly have. Kirsten, Bill, and Karen, thank you so much. I really appreciate it. We're just one hour away from oral arguments on the president's travel and immigration ban before the Ninth Circuit Court. Wolf Blitzer will have much more on that in "THE SITUATION ROOM." That's next. Thanks for watching. Watch us tonight at the health care debate between Ted Cruz and Bernie Sanders.


WOLF BLITZER: Happening now, "BREAKING NEWS", trap --