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Obama Warned Trump about Flynn; Kushner Family's China Sales Pitch; Trump Spends Weekend at Trump Property. Aired 12-12:30p ET

Aired May 08, 2017 - 12:00   ET

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

[12:00:00] JOHN KING, CNN ANCHOR: Breaking news this hour. President Obama, it turns out, warned then President-elect Trump not to bring retired General Michael Flynn into the new administration. We'll go to the White House live on that news in a moment.

And it comes as we wait to hear from a star witness in the Russia election meddling investigation. The former acting Attorney General Sally Yates. She issued another warning then to the Trump White House that Flynn, who was hired as the national security adviser, might be vulnerable to Kremlin blackmail.

(BEGIN VIDEO CLIP)

MICHAEL HAYDEN, FORMER CIA DIRECTOR: If the acting attorney general insists on seeing the White House Counsel, that's a tectonic thing in its own right. But she's going to put an exclamation point on it.

(END VIDEO CLIP)

KING: Plus, as the repeal and replace debate now heads to the Senate, the namesake of Obamacare speaks out against the plan passed by the Republican House.

(BEGIN VIDEO CLIP)

BARACK OBAMA, FORMER U.S. PRESIDENT: And it does require some courage to champion the vulnerable and the sick and the infirmed.

(END VIDEO CLIP)

KING: And a fresh face but a familiar path. France picks a president and sends a message.

(BEGIN VIDEO CLIP)

EMMANUEL MACRON, PRESIDENT-ELECT, FRANCE (through translator): I will struggle with all my strength against the divisions which subvert us and it is only that way that we can give back to the people of France.

(END VIDEO CLIP)

KING: With us to share their reporting and their insights, Jackie Kucinich of "The Daily Beast," CNN's Manu Raju, Michael Bender of "The Wall Street Journal," and CNN's Dana Bash. In a court of law, you might call this trying to intimidate the witness. "Ask Sally Yates under oath if she knows how classified information got into the newspapers soon after she explained it to the White House Counsel." For the record, that's the president of the United States tweeting that. And, for the record, he misspelled "counsel" in his first tweet and then later fixed it.

But today it's about a lot more than bad spelling. Sally Yates, then the acting attorney general, warned the Trump White House earlier this year that its national security adviser, Michael Flynn, was not telling the truth about a conversation with Russia's ambassador and might be so compromised he could be blackmailed by the Kremlin. Now, she will publicly testify for the first time this afternoon. This morning's tweets tell you everything you need to know. This hearing has the president's interests.

And how about this late breaking news wrinkle? CNN's Jim Acosta, live for us at the White House right now with word that today would be a very different day, Jim, had President Trump taken a little advice from his predecessor.

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: That's right, John.

Yes, we are reporting that during this meeting that they had in the Oval Office on November 10th, that President Obama told then President-elect Trump that he should not hire Michael Flynn, the retired general, for national security adviser. I was told by one former Obama official that the president's message to the president- elect at that time was simply that there are better people to hire for this position.

However, we're also hearing, our colleague Jake Tapper is reporting, that part of the basis for the president's warning to the president- elect at that time was this Russia investigation that, of course, Michael Flynn was being looked at as a part of. And so I think this is a -- this is a huge topic that we're going to be hearing about during the briefing, which has been pushed up, by the way. It's going to start at 1:00 according to the White House. So we'll be hearing from Sean Spicer in just a few minute. And we should -- we should report, John, that at this point we have not heard from any White House officials -- current White House officials -- about this news that President Obama warned then President-elect Trump that he should steer clear of Michael Flynn.

KING: And yet, Jim, as we wait for Sally Yates to testify, and we digest this new breaking news about President Obama's warning, it seems that the Trump White House is prepared to take an aggressive tact against her if she goes up and gives the testimony we're expecting.

ACOSTA: That's right. They're going to say that essentially Sally Yates is a partisan, that she is a holdover from the Obama administration. So, of course, she would -- she would be causing trouble for this new administration coming in. But, you know, a lot of people have come to Sally Yates' defense in the last several weeks since she was forced out by President Trump and, you know, they will say, and they have said, and I suppose you will hear this from Democratic members of the committee when she's testifying today, that she is a career attorney, a career public servant, and not somebody who's just going to go around making partisan attacks.

You know, this is -- Michael Flynn just continues to be this ongoing drip, drip, drip problem for this White House. President Trump, just as of this morning, was tweeting that Michael Flynn was vetted by the Obama White House, essentially saying it's the Obama administration's fault. That is something that we heard from Sean Spicer during a briefing here a couple of weeks ago. But the problem with all of that is, now you have this revelation that President Obama, on November 10th, two days after Donald Trump was elected president of the United States, was warning President-elect Trump that he should stay away from Michael Flynn. And I suppose this is just one of those stories where we're hearing the beginning of this now I think if we were to get behind the scenes during that 90 minute meeting that the president, the president-elect, had at that time, the details from that conversation would be fascinating.

John.

KING: Jim Acosta live at the White House. You're right, every time we learn something in this story, it takes us -- a new wrinkle, a new wrinkle, a new wrinkle, and it continues.

[12:05:02] Let's bring it inside the room.

So we're going to get some testimony -- we're going to get some testimony in a minute, but the idea that President Obama leaned over during his private meeting with the president-elect and said, look, don't hire this guy. Now, we don't know how specific he was. We know that he just said, you know, he's a bad guy. But that's a pretty remarkable development and obviously advice the president did not take.

MICHAEL BENDER, "THE WALL STREET JOURNAL": I mean in the president's -- in President Trump's defense here, I think President Obama gave him a lot of advice in that meeting. It may have been hard to keep track of every piece of it. But I think this just goes to show, I mean, President Trump views himself as his own best communications director, his own best chief of staff, his own best research -- opposition research pro, as he showed this morning. And, you know, when he gets on Twitter, he's also his own worst enemy. I mean there was discussion this morning about whether or not, you know, how much Ms. Yates testimony would really advance the ball. So Trump gets on Twitter, shifts the blame to Obama, and then we see, you know, a -- surprisingly leaks from Obama world saying, well, hey, we warned him about this.

DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: And my understanding is, in that warning in the Oval Office, that first meeting with then President-elect Trump went to meet with Barack Obama, that what President Obama's message was, was, you know, the national security adviser is a really important role in your White House. Like the most important role. You need to remember that. But we also know from covering Donald Trump during the campaign that,

you know, for better or worse, he is pretty loyal to the people who are loyal to him. And Michael Flynn was on that plane every -- almost every single day. He was with him through thick and through thin and he was, at the end of the campaign, out there to his peril screaming "lock her up." So he was -- Donald Trump felt a loyalty to Michael Flynn. Whether or not that's because he was very close to him or there was something else that maybe Michael Flynn knew things that he wanted to keep him in the fold, we don't know the answer to that.

JACKIE KUCINICH, "THE DAILY BEAST": Well, and what the White House was telling NBC News right before we came on is that of course Obama doesn't like Michael Flynn. He was openly critical of him during the election. Obama fired him. So there's a lot of bad blood there. So perhaps then the president-elect took what Obama said as kind of sour grapes. That would not be, you know, beyond the realm of possibility.

MANU RAJU, CNN SENIOR CONGRESSIONAL REPORTER: But, you know, it's interesting this news coming out just moments before this hugely anticipated testimony this afternoon. Almost designed, it seems, to show that these warnings were coming from all angles from the previous administration. They were coming in fast and furious and the Trump administration ignored them. At least that's how it seems that the Obama world wants to make this -- wants this to appear. How this will affect today's testimony too will also be interesting. Did Sally Yates know about what President Obama said to President Trump and will she be able to say any of that too? It will also be interesting.

KING: And, look, this is important to the president of the United States, to Michael's very important point, he views himself as his best communications adviser. He communicates differently. But he is the president of the United States. He's the president of the United States and the former acting attorney general, who's about to testify under oath before the United States Congress, and you tweet, "ask Sally Yates under oath if she knows how classified information got into the newspapers soon after she explained it to the White House Counsel." I started before I got to covering politics all the time -- I used to cover the courts a lot. A lawyer would call that witness intimidation.

BASH: Completely.

KUCINICH: Yes.

BASH: From the president of the United States. Look, I think that we have all been kind of desensitized in some way to his tweets and to his statements that are so out of the norm. This is beyond out of the norm. This is inappropriate. For the president of the United States to be this aggressive with somebody who used to work for him, who is coming before the United States Congress in sworn testimony hours later is beyond the pale. It just is.

KING: And you can ask -- you can -- look, we saw this -- we've seen this in the Comey hearings. We've seen this in other hearings. The White House can send word up to its Republican friends on Capitol Hill, make sure you push her on this, make sure you push her on that. BASH: That's the way -- that always happens.

KUCINICH: Right.

KING: But to go -- but to go public -- but to go public like this is striking.

I want to bring in the voice of the former national security adviser, Condoleezza Rice, because the issue here is that we know that Flynn spoke to the Russian ambassador and he denied discussing anything improper. It was about scheduling, about meetings, about, hey, we're going to be the new administration. That's how Flynn initially described it. But the Russian ambassador was being wire tapped at the time, as he routinely is, and U.S. intelligence picks up that, no, they had a conversation about sanctions that had just been put in place by the Obama administration and we don't know the full details but apparently something about the possibility of lifting those sanctions. That's where Condoleezza Rice says Flynn would have crossed the line.

(BEGIN VIDEO CLIP)

CONDOLEEZZA RICE, FORMER SECRETARY OF STATE: It is not unusual to meet with foreign dignitaries, ambassadors when you're in transition. That's not unusual at all. I did myself as the national security adviser-elect for President George W. Bush. But you can't -- you can't discuss policy and you can't suggest that you might change policy.

(END VIDEO CLIP)

KING: That's going to be part of the conversation when we get this dramatic public testimony from Sally Yates in a couple of hours. What are we expecting out of that hearing and tie it in to where these investigations are going.

[12:10:06] RAJU: I think that it will be interesting to see how far Sally Yates is able to go without saying anything that she learned in a classified setting. That's going to be a big question. And were there further contacts that Michael Flynn may have had with Russia beyond the ones that -- with Ambassador Kislyak that were disclosed belatedly to -- that led to his -- his firing. That's going to -- that's one big question.

The other question is, I mean how this ties to the broader investigation, look, he is facing a Defense Department inspector general investigation, there's an ongoing House Oversight Committee investigation about his failure to disclose key information to the -- on his security clearance forms, as well as to get permission before accepting payments from foreign governments, including Russians. How much more we learn about that could hurt -- be significant for him. And also, how much did -- will we learn about the vetting process that occurred that led to his hiring and did they know about some of this stuff when they decided to hire him as national security adviser?

KUCINICH: And kind of on a less serious note, I mean, compared to what you're talking about is, how much this erodes the credibility of some of the president's most vocal defenders and spokesmen. Sean Spicer said that she gave a heads up. So did -- to Counsel Don Mcgann (ph). Reince Priebus said the same thing. To what extent are they -- to what they -- they say. I mean she's expected to completely contradict them. How bad is that going to be?

KING: And as these investigations go on, and Manu has a great piece on cnnpolitics.com about how frustrated some of the lawmakers are and just how hard the work is, how long the work is. You said at one point, some of the documents stack up higher than the lawmakers if you stand them up -- if you stand them up side by side.

I want you to listen to Eric Swalwell, who was on with John Berman earlier today here on CNN, and this one's a dicey one for Democrats because they have asked -- accessed all the classified information. One of the questions about Michael Flynn is, were these contacts with the Russians OK, even if maybe they were a little out of bounds, or was there coordination and collusion during the election campaigns as the hacks were taking place. Listen to Eric Swalwell. He is asked -- he's asked flatly by John Berman, you've seen the classified information, is there things -- are there things in that information that leads you to believe there was collusion.

(BEGIN VIDEO CLIP)

REP. ERIC SWALWELL (D), CALIFORNIA: These are not just mere coincidences. This is a convergence. And then there's a whole classified side of information that I hope the world sees very soon. I hope the FBI, and I have every reason to believe, will continue to develop this. But this is not Donald Trump being the unluckiest man in the world to have all of these coincidences converge at the same time that Russia's interference was taking place.

(END VIDEO CLIP)

KING: It's a member of the committee. So, on the one hand, you take what he says quite seriously. On the other hand, should the Democrats be talking publicly about their conclusions based on seeing classified information or should they be saying, I can't answer that question right now. I hope we get to a point in the investigation where we can release all this.

BENDER: Well, this is the question, when we're going to get to this -- get the actual information of what was said and when it was said. And until then, it's all sort of conjecture. You know, the -- and this is when, you know, Trump's protests on Twitter would also suggest that there is -- there is plenty of fire here. But on the other hand, this is a president who -- and he perceived -- reacts to any perceived slight. So hard to read -- you know, should be warned to read too much into that.

KING: Right. Right.

RAJU: And one of the things, John, I've heard is that you're seeing a division between the Democrats and Republicans about the evidence that they're seeing. A lot of Democrats see this as collusion. And -- exactly, shocking, shocking. KING: Right.

RAJU: And Republicans say that, look, we don't know this is collusion. Maybe this was about a business meeting that occurred between, say, Carter Page and someone to help his company, or Paul Manafort in a -- in something that had nothing to do with the campaign. That's what they're struggling with to determine right now.

KING: Right. Well, this is going to go on for months and months, if not longer.

Everybody sit tight. We'll continue to track the breaking news. President Obama warning Donald Trump not to hire Michael Flynn.

Up next, though, just business as usual or is this cashing in on White House connections? The Kushner family makes a play for big money in China.

(COMMERCIAL BREAK)

[12:18:24] KING: Welcome back.

The Kushner family says it is sorry and that it was not cashing in on political connections when it mentioned presidential son-in-law Jared Kushner's White House work during a big sales pitch in China this past weekend. The apology was issued by Kushner companies on behalf of Mr. Kushner's sister, Nicole Kushner Meyer. She did the name dropping at this investment conference -- we have some video of it -- in China where the Kushner company recruited investors for a New Jersey property where buying in provides access to what's called an EB-5 visa. The EB-5 program works like this, invest $500,000 or more in a U.S. project that creates jobs, and you can get fast tracked for a green card. The Kushner company presentation also included a slide showing President Trump. A "Washington Post" researcher at the event says she was, quote, "threatened, harassed, and forced to delete" recordings and photos of the Kushner family recruiting Chinese investors.

This happens over the weekend. I have argued from the inauguration that you can't expect everyone to shut down their businesses. That you want new voices in politics. You want people from the business community to get into politics. And, of course, they should be able to keep the businesses they spent their time and hard earned money working on. But when people do things like this, it makes you think -- is this defensible in any way?

BASH: No.

KUCINICH: No, and it's also the day after Trump resigned this into law as part of the spending package. So that also -- the timing isn't great either. But, no, this isn't OK. This isn't -- this -- even -- even if -- let's give them the benefit of the doubt and say they didn't mean to do this. The fact that it looks improper is what matters.

BASH: If you were to, you know, be reading the factious novel of the Trump administration and you would get to the chapter where the son- in-law's sister goes to China and tries to sell, you know, money -- tries to get the Chinese to invest, that would be the part where you'd be like, this it just -- I can't -- this has -- this has gone too far. I don't believe this. And then throw the book away.

[12:20:14] KUCINICH: Right.

BASH: But it's real.

KING: And isn't this what candidate Trump repeatedly warned, and his surrogates repeatedly warned, that this was Clintoning. They often talked about, you know, everything the Clinton's do is corrupt. Everything the Clinton's touch is to make more money. And then you have something like this.

I want to read more from the apology directly. "Ms. Meyer," who is Jared Kushner's sister, "wanted to make clear that her brother had stepped away from the company in January and had nothing to do with this project." If that's what she wanted to make clear, she could have just said that.

KUCINICH: And that's why we need a -- go ahead.

BENDER: It's not to blame -- it's not to blame Jared Kushner for this, right? I mean and his people, his lawyer is very careful to say, we've taken all of the appropriate steps, all the steps that have been recommended to us. But this is -- this is outside the box of what you can fit into a -- you know, into ethical rules and laws. This is about perception. And to Jackie's point earlier, it's about credibility. And this is a president who's playing fast and loose with the credibility that he -- the credibility (INAUDIBLE).

KING: And does it -- does it set off ethics watchdogs and lawyers here in Washington? Does it get reporters saying we need more transparency? What about voters? Immigration reform was a big part of the Trump -- if you're a Trump voter in Iowa or Wisconsin or Tennessee or anywhere else, and part of your thing was, he's going to be tough on immigration, this is the other end of the immigration debate. This is essentially -- you know, some people view this as selling access to the United States to rich people.

RAJU: And also the pledges to drain the swamp, and it doesn't look like you're draining the swamp if your family member is trying to profit on your connections, allegedly. It will be interesting to see if and when Congress the who, of course, is controlled by Republicans, decides to investigate any of these presumed conflicts of interest that appear to be happening from time to time with Trump, Trump properties, Trump relatives, and their own companies. We have not seen that level of interest yet from the Oversight Committees on The Hill. Will that change with stories like this?

BASH: But that's a good question. I mean throughout the entire campaign, Donald Trump, and the people around him, were impervious to criticism from people who supported him because they supported him because he promised to bring jobs back, because of trade, because he was different, all the reasons we know. But the question is, at what point -- or does it ever -- seep into the consciousness of people out there who voted for him saying, wait a minute, this is not what I bargained for.

KING: Right.

BASH: That doesn't seem to be there yet, but you never know if the combination of a lot of these things will get them to that point.

KING: And the president himself, this is a very separate issue, but the president himself has made clear where people say, you know, you can't keep going to Trump properties. You can't do that. He has made crystal clear he's just going to -- if that's a yellow light, he's just going to drive through it. This was the 14th consecutive weekend he went to a Trump property. He played golf again as he went to his property in Bedminster this time. And the president was making the case that staying in Bedminster is cheaper for the government than staying in Manhattan at the Trump Tower because of the security costs. And that's actually true. There's no doubt that's true. But in the sense that for those who would say your name is Trump, you can't keep going to do essentially promotions for Trump resorts, his answer is, go away.

KUCINICH: You know, the other thing, the White House doesn't close on the weekends. He can stay there, too, here in D.C. There's nothing wrong with it. The lights still turn on and everything, I'm told. But it really -- it really doesn't seem like they care. That's why the two sons that are not supposed to have anything to do with administration are -- Don Jr. is politically active.

RAJU: And -- and it's a transparency issue too. I mean we don't know who he's meeting with --

KUCINICH: Right.

KING: Right.

RAJU: In when he goes to these Trump properties on the weekend. Of course they close the visitor's log too. That's an issue as well. But, you know, that -- who is he even playing golf with? We don't even know that he's playing golf. They wouldn't even actually publicly confirm that. It's been a retreat from the Obama years where they did disclose this information, even saying who he would golf with virtually every weekend.

KING: Right.

RAJU: Trump doesn't do that. We don't know his -- who these associates are.

KUCINICH: And I do think that Mar-a-Lago, there's the money -- the amount of money that was being spent to go to Mar-a-Lago was starting to make an impact. Now, of course, you don't go there because it's the summertime. But I think that the fact that he -- you've said that, you know, people knew he was rich coming in. It's one thing to be rich coming in. It's something entirely different to make a profit off of the office by promoting your resorts. And that's where the question remains is when -- when is someone going to put their foot down on that.

KING: And I think the critics would have much less of a case if they were fully transparent.

KUCINICH: Right.

KING: When he said, these are the people he has meetings with when he's there. This is who he golfed with. If they were fully transparent about that, and said, this is the president's home, this is -- the president owns this property. He has every right to be there. You have a much better case if you were fully transparent about who you were with.

Everybody sit tight. Up next, President Obama telling Washington lawmakers to be the lion in "The Wizard of Oz." Have a little courage.

(COMMERCIAL BREAK)

[12:28:30] (BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: You are band-aiding people on Medicaid except dying. You are making a mandate that will kill people.

REP. RAUL LABRADOR (R), IDAHO: No. No one wants anybody to die. But, you know, that line is so indefensible. Nobody dies because they don't have access to health care.

(END VIDEO CLIP)

KING: The boos and jeering there for Republican Congressman Raul Labrador, taking heat back home in Idaho for his vote last week to repeal and replace Obamacare. The Senate is next and there's one certainty, the process will look nothing like the House roller coaster, which, as you'll recall, included one House vote being abruptly canceled and weeks of frantic and very public horse trading. Chaotic is a polite word for what we saw in the House. Methodical is the preferred path of the Senate Majority Leader Mitch McConnell. And as he now, in his way, tries to sort through the same policy and ideological divisions that complicated the House vote -- debate, an old McConnell sparring partner trying to rally Democrats to put up a good fight.

(BEGIN VIDEO CLIP)

BARACK OBAMA, FORMER U.S. PRESIDENT: I hope that current members of Congress recall that it actually doesn't take a lot of courage to aid those who are already powerful, already comfortable, already influential, but it does require some courage to champion the vulnerable, and the sick, and the infirmed.

I hope they understand that courage means not simply doing what is politically expedient, but doing what they believe deep in their hearts is right.

(END VIDEO CLIP)

KING: Former President Obama accepting an award at the JFK Library, the Profile in Courage Award.

[12:30:09] He didn't say anything during the House debates. How influential is his voice or do Democrats need his voice?