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Bipartisan Legislation to Combat Sex Trafficking; Transcripts with Foreign Leaders Leaked; Audio of Scaramucci Released; Trump Phone Call With Australia; Propaganda Monies Not Spent; Senators On Sex Trafficking. Aired 1-1:30p ET

Aired August 03, 2017 - 13:00   ET

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

WOLF BLITZER, CNN HOST: Hello, I'm Wolf Blitzer. It's noon in Mexico City, 1:00 p.m. here in Washington, 3:00 a.m. Friday in Sydney, Australia. Wherever you're watching from around the world, thanks very much for joining us.

We begin with a stunning new look at two phone calls President Trump had with key allies during his first days in office. The calls with the president of Mexico and Australia's prime minister happened in January. Several details were reported at the time. But, today, we have complete transcripts of the contentious phone calls.

In the transcripts obtained by "The Washington Post," President Trump boasts about his election win and tells his Mexican counterpart to stop publicly saying that he won't pay for a border wall, saying, quote, "but you cannot say that to the press. The press is going to go with that and I cannot live with that." Close quote.

In another call with the prime minister of Australia, President Trump blasts a deal the Obama administration had made to accept refugees held by the Australians. Calls his predecessor incompetent, referring of President Obama, and abruptly ends the call by saying, quote, "this is crazy."

And the leak comes as the White House tries for a major reset with new chief of staff, General John Kelly, clearing House and trying to establishment order.

Let's go to our Senior White House Correspondent Jim Acosta. He's joining us from the White House. Jim, let's start with that phone call between President Trump and the president of Mexico. What else can you tell us?

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, it's pretty revealing, Wolf, because, after all, during the campaign, I was out there and so many other campaign reporters out there, covering Donald Trump during that campaign. And he talked about, at just about every rally, how he was going to build a wall on the border with Mexico. And Mexico was going to pay for it.

And what you see revealed in the transcripts of these phone calls obtained by "The Washington Post" is that perhaps the president is not so wedded to this proposal of having Mexico pay for the wall. We can put this first chunk of the phone call on-screen, part of this

transcript. It says, "When the press brings up the wall, I will say, let us see how it is going. Let us see how it is working out with Mexico. Because from an economic issue, it is the least important thing we are talking about, but psychologically, it means something. So, let us just say, we will work it out."

That is the president talking there with Enrique Pena Nieto, the Mexican president there. They go on to talk about how the president may not really insist Mexico paying for that wall. That they'll find some other funding mechanism.

And then, Wolf, the other item that I thought was interesting that came out of this phone call was the president talking about winning New Hampshire. He did not win New Hampshire in the general election. He did win the New Hampshire primary.

But let's put this up on screen, because it is a statement that is grabbing people's attention up in New Hampshire. It says, we have the drug lords in Mexico that are knocking the hell out of our country. They are sending drugs to Chicago, Los Angeles and to New York.

Up in New Hampshire, I won New Hampshire because New Hampshire is a drug-infested den. And, Wolf, we understand that the governor of New Hampshire has already weighed in with a statement, criticizing the president for making that remark.

But, obviously, the president has focused heavily on this issue of opioid abuse. And -- but he, obviously, did not put it in very diplomatic terms, in talking about that problem with the Mexican president -- Wolf.

BLITZER: What can you tell us about the president's call, the transcript now released by "The Washington Post" with the Australian prime minister? Because that was pretty bombastic as well.

ACOSTA: That's right, Wolf. You'll remember, we talked about this at the beginning of this year. When the president came into office, he had that testy phone call with prime minister Turnbull of Australia. And some portions of that leaked out and made news at the time.

But now that we have the transcripts, you do see how testy it was. We can put this first chunk up on-screen. And it's interesting to see the president talk about the difference between talking with some leaders and Vladimir Putin.

He says, look, I spoke to Putin, Merkel, Abe of France today, and this was my most unpleasant call, talking about his call with the prime minister of Australia. Because I will be honest with you, I hate taking these people. I will guarantee you they are bad. That is why they are in prison right now.

The president talking about taking any of these refugees from Australia. That was a deal, as you mentioned, that was crafted by the Obama administration. Obviously, the president did not want to have to deal with that. And here's another portion of his conversation with the Australian

prime minister. He says, look, I do not know how you got them to sign a deal like this, but that is how they lost the election. They said I had no way to 270 and I got 306.

That is why they lost the election because of stupid deals like this. You have brokered many a stupid deal in the business. And I respect you, but I guarantee that you broke many a stupid deal. This is a stupid deal. This deal will make me look terrible.

And so, the president there, Wolf, as you know, showing some sensitivity there that perhaps if he were to welcome these refugees into the country from Australia, he might somehow look soft on the issue of immigration and refugees which was obviously an issue he hit time and again out on the campaign trail and he feels that was part of the reason why he was propelled into the White House -- Wolf.

[13:05:17] BLITZER: Yes, in April of this year, we know the vice president, Mike Pence, publicly announced that the U.S., the Trump administration, would accept the deal that was worked out by the Obama administration. A deal the president, according to those it transcripts, really, really hated.

Jim Acosta at the White House, thanks very much.

As we mentioned, President Trump described his call with the Russian president, Vladimir Putin, as pleasant during the conversation with the Australian prime minister. But relations between the U.S. and Russia are anything but pleasant right now.

President Trump reluctantly signed a bill this week to impose new sanctions on Moscow, and Russian officials are blasting him over the move.

Let's go to our Senior International Correspondent Matthew Chance who's joining us live from Moscow. Matthew, Russia's prime minister says, President Trump, and I'm quoting him now, "demonstrated complete impotence by signing the sanctions bill." What more are you hearing from officials in Moscow?

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, they've called this bill dangerous and short sighted.

But it really is those words from the Russian prime minister, Dmitri Medvedev, that are so scathing, that one completely incomp -- impotence, rather. He called it a humiliating thing. And said that the American establishment had completely outplayed Trump and put they him in his place. And so, these are all phrases that must have been picked intentionally to try and anger the U.S. president.

And I think it shows, from a kremlin point of view, not just that they're disappointed with the fact that Trump signed this bill and that Congress passed it, but they almost seemed to have moved on from the idea that Donald Trump is the president of the United States.

He's the man who could potentially turn around the very difficult relationship between Washington and Moscow. That's what Trump promised. That's what the Russians hoped for.

But I think the Russians are now basically saying, look, we do not believe that can happen going forward.

And so, I think that's a significant moment in this very difficult, very strange relationship between these two countries.

BLITZER: Yes, it is, indeed. Matthew Chance in Moscow, thanks very much.

President Trump blames lawmakers up on Capitol Hill for the current state of affairs between the United States and Russia. In a tweet this morning, he said, and I'm quoting the president now, "Our relationship with Russia is at an all-time and very dangerous low. You can thank Congress, the same people that can't even give us health care."

Republican Senator Rob Portman of Ohio is a member of the Senate Foreign Relations Committee. He's joining us live from Capitol Hill. Senator, thanks for joining us.

SEN. ROB PORTMAN (R), OHIO, SENATE FOREIGN RELATIONS COMMITTEE: Wolf, thanks for having me on.

BLITZER: So, what's your reaction to President Trump blaming the Republican-led House, the Republican-led Senate, your colleagues in Congress, for this troubled relationship right now with Russia?

PORTMAN: Well, we have a difference of opinion. Many of us, including me, believe that Russia is continuing to destabilize democracies around the world, that they did meddle in our election. I think that's pretty well the conventional wisdom now. And so, they need to be held accountable for that.

And to have a good relationship with Russia is something important to us. We have some things in common, including fighting Islamic extremism. And, you know, we should be working better together on that.

But we can only do so if it's an honest relationship and one that's consistent with the values that we hold dear including, not getting involved in other country's elections. Not, actually in the case of Crimea, taking another country's land. And that's what the sanctions are about.

I think if the Russians don't feel there are any consequences to this kind of activity, that they continue to do it. So, we want to have a good relationship but it's got to be based on honesty and following the rules of the road.

BLITZER: Like almost everyone else in Washington, Democrats and Republicans, you blame the Russians for this very bad relationship right now. Everyone except the president. He blames the Republican- led Congress.

And he doesn't say anything at all about the Russians, what they're doing. There is a thunderous silence, that some have called it, from the president as far as Putin and the Russians are concerned.

You met with President Trump yesterday at the White House. Why is that?

PORTMAN: Well, we didn't talk about Russia. We talked about opioids, where he's taking a strong stand. And I appreciate what he has done, with regard to fighting back against what you talked about earlier which is unfortunately an epidemic now around our country.

With regard to Russia, again, we want to have a good relationship with them. We should be working together on a lot of things together, including the Middle East, including, you know, fighting back against terrorism and violent extremism. But it's got to be based on the kind of terms that America always insisted on.

So, by the way, I don't think our relationship with Russia is as bad at the height of the cold war. I mean, I think we -- you know, we have communication with them. We are -- we are working with them. We have, you know, established the ability to actually, you know, have some decent dialogue on some issues including, again, pushing back against terrorism.

[13:10:02] So -- but it's got to done on a basis that is honest and, you know, where we are holding them to account for the things they are doing that are affecting us and other democracies.

If you look at what they've done, Wolf, in Europe, whether it's Germany or France or the U.K., certainly what they're doing in the eastern border of Ukraine, as we talked today, where they're again building up forces there and causing more instability in that country. A country that's turned to us and the west.

You know, we need to hold them accountable for that. And that's what these sanctions are about and I think they're appropriate.

BLITZER: But what's curious, Senator, we hear what you're saying, so many others are saying, Democrats and Republicans. We hear it from the vice president, the secretary of state, the national security. We don't hear it from the president. Let me repeat the question, why?

PORTMAN: Well, I think he wants to have a better relationship with, you know, a major super power. And that's understandable. And I understand his frustration that that has not been able to be accomplished.

And let's face it, the Bush administration tried and was not terribly successful. The Obama administration tried. They pushed the so- called reset button. They were not terribly successful.

So, he had hoped that he would be able to break through and to be able to have the kind of relationship with Russia that would be constructive for both countries. That's very difficult to do when Russia continues to act in the way that they have, in a destabilizing way and aggressive way. Not just again here in our elections but around the world. One of the issues that we are confronted with today is the fact that the State Department has the ability to use about $60 million in funds to be able to push back against some of the disinformation that Russia puts out. And apparently, the State Department is hesitant to the do that right now.

This is an example where there is a bipartisan consensus where you'd think the president and his people would be very eager to up our game. Particularly online, to be able to ensure that, you know, America is taking the lead around the world in pushing back against false information and disinformation that is, again, destabilizing, particularly in some of these fledgling democracies.

So, you know, we just have a difference of opinion, I guess, in how to approach it. I think we have the same objective. And I understand the president's frustration. We'd all like to have a better relationship with Russia. But it requires them to change their behavior and that's what these sanctions are about.

BLITZER: Yes. You co-sponsored the legislation to provide, what, 60, maybe $80 million to the State Department to fight Russian propaganda, ISIS propaganda. They're not spending it.

You said, in your statement, you said, countering foreign propaganda should be a top priority, and it is very concerning that progress on combining this problem is being delayed because the State Department isn't tapping into these resources.

I assume you've raised this issue with State Department officials, maybe with the secretary of state, maybe with the president. Why are they not using this money to fight Russian and ISIS propaganda?

PORTMAN: Well, I have raised it. In fact, we had a hearing a couple weeks ago on this where I was able to talk to the deputy secretary of state specifically about this issue. And he indicated that this was one of the secretary's priorities. That they wanted to, you know, provide the funding.

I think part of the issue, frankly, Wolf, is they have had a tough time getting up and going at the State Department. Partly, because they don't have nominees who have been confirmed in political positions, including with regard to this one area of pushing back on disinformation.

So, my hope is it's just a matter of time until they get people in place and can begin focus on this issue. You know, we, traditionally in the United States, have assumed that other countries are, sort of, playing fair on this.

And, at the same time, Russia has been spending more and more money and more and more resources, particularly online, with effective disinformation campaigns. Not just here in this country but around the world.

In fact, even more so with regard to Eastern European countries, the Baltic countries, as an example. And we do need to push back. And we need to be helpful to other countries as they try to push back.

BLITZER: Before I let you go, I know you're helping lead the bipartisan effort right now behind a bill to combat sex trafficking and to crack down on Web sites that promote it. Tell us about this legislation.

PORTMAN: Well, it's very simple. We're trying to keep girls and women from being exploited online. Sex trafficking has exploded in this country, we are told. All the data indicates that.

And I think the reason is pretty clear. Which is it's moved, as victims of sex trafficking have told me, from the street corner to the smartphone.

And this means that we need to go after some of these Web sites that have been brazenly selling girls and women online. They've had immunity, based on the court cases that have been brought against them, the prosecutions against them. They have had an immunity that they've been hiding behind in federal law.

So, our legislation is very simple. It just removes that immunity in a very targeted, direct way. That says if you knowingly facilitate sex trafficking, that you cannot hide behind this immunity.

And it, essentially, takes the federal law that already exists against sex trafficking and puts it clearly in place with regards to these Web sites. The one most offensive, the one that is promoting most of this is called backpage.com.

[13:15:00] And so, we spent two years investigating this organization. We found out they were knowingly, again, selling girls and women online illegally.

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PORTMAN: And so we spent two years investigating this organization. We found out they were knowingly, again, selling girls and women online illegally. And we just need to have a way to be able to allow victims to be able to get the just they deserve and to allow the prosecutors around the country, including the state attorneys general, 47 of whom have asked for us to make this change, including the Department of Justice, to be able to go after some of these despicable web sites that are engaged in this sex trafficking.

BLITZER: Senator Portman, thanks so much for joining us.

PORTMAN: Thank you.

And, by the way, the Trump administration has been very supportive of that effort. And I appreciate that as well.

BLITZER: All right. Well, good luck. It's an important issue that you're dealing with. Thanks so much for doing that. Thanks for joining us once again.

PORTMAN: Thanks, Wolf. BLITZER: Up next, these leaked transcripts come just days into John Kelly's new role as the White House chief of staff. We have details on the general's plans to try to bring order to the West Wing. >

Plus, the president may be inching closer and closer to a decision on a new military strategy in Afghanistan. I'll speak with the secretary- general of NATO. That's coming up later this hour.

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BLITZER: Leaked transcripts of President Trump's phone calls with key allies are threatening to derail a major reset week for the White House. The calls are contentious. During one, President Trump tells the president of Mexico to stop publicly saying he won't pay for the wall. The president's call with the Australian prime minister is even more tense, with the president saying at one point, it's, quote, the most unpleasant call he's had with a foreign leader yet, and that includes his conversations with Putin and with Angela Merkel. He later says, and I'm quoting him know, this is ridiculous. This is crazy. He says that to the Australian prime minister, Turnbull, before quickly ending the call. Even though Turnbull wanted to discuss Syria and north Korea.

[13:20:38] With us to discuss, our CNN political director Dave Chalian, Washington bureau chief for "The Daily Beast," Jackie Kucinich, and former State Department spokesman, Pentagon press secretary, John Kirby, as well.

David, you've read through these transcripts. I've read them. Your immediate reaction?

DAVID CHALIAN, CNN POLITICAL DIRECTOR: The first thing that jumped out to me about the Mexico phone call was that the president was not -- and, remember, he was president for eight days at the time, I believe, but the president was not arguing for Mexico's payment of the wall in principle. It was purely he didn't want him to talk about it in the press. He was so transparent, much more so than he has been publically with the American people, in his call with the Mexican leader, that this was a political problem for him if the veneer -- the sort of sheen that he put out there about Mexico will pay for the wall, that his big campaign rally line will be turned into a lie if Mexico keeps refusing to do this. He wasn't arguing for the payment on principle.

And, of course, it also made me wonder instantly, tonight he has a campaign rally in West Virginia. What is he going to do with that line tonight? And can -- is the crowd going to be around, a chant about Mexico paying for the wall?

BLITZER: Because every time the president said, at least don't talk about it, he said, well, look, the Mexican president, Pena Nieto said, you know what, we're not going to pay for the wall. Forget about that. That's a non-starter. I can't do that. it was a very contentious exchange if you read the transcript that the president had with the leader of Mexico.

Jackie, the conversation with the Australian prime minister, Malcolm Turnbull, was also contentious. At the end of the conversation the president -- afterwards, after the conversation, when there were initial reports about a contentious conversation, the president tweeted this, President Trump. Thank you to prime minister of Australia for telling the truth about our very civil conversation that fake news media lied about. Very nice.

Well, if you read the transcript, fake news media was right. It was very contentious on this issue of President Trump accepting the arrangement that President Obama worked out with the Australians to accept some 2,000 refugees.

JACKIE KUCINICH, WASHINGTON BUREAU CHIEF, "THE DAILY BEAST": Well, right. And the fact that this keeps happening to this president, he says one thing and the it turns out that he wasn't telling the truth. And -- and the -- and the press was actually right, which is why, when maybe something comes out that might not be really accurate, it's hard to believe what they're saying. It completely undermines what the administration is trying to do, not only with the press and, you know, the administration doesn't really care about us, but when it comes to Congress.

We saw this over with Donald Trump Jr. and the Russia meeting, for example. They said it happened one way and then it turns out it happened a completely different way and the conversation was about something entirely different, not adoption, about dirt on Hillary Clinton. And I hate to keep going back to that, but that is something that very recently has undermined Congress' trust in him and as we're seeing in this latest Quinnipiac poll, you're seeing it filter out into the public that the president is just not seen as trustworthy.

BLITZER: John Kirby, and the end of that conversation, the president repeated once again, I think it's a horrible deal, a disgusting deal that I would have never made. It's an embarrassment to the United States of America and you can say it just the way I said it. And then Prime Minister Turnbull says, well, do you want to talk about Syria and North Korea? And then the president clearly, there's an inaudible chunk, basically says, this is crazy, and ends the conversation.

JOHN KIRBY, CNN MILITARY AND DIPLOMATIC ANALYST: Yes. So I mean on issues that are arguably from a geopolitical perspective much more important than this refugee problem, he, you know, he cuts it off and doesn't want to talk to the prime minister of a country which is a key ally of ours in the Asia-Pacific region and a key contributor to NATO operations around the world. We don't want to talk about that.

Look, I think no matter what your politics are, and I suspect that -- I'm going to go out on a limb here and say that foreign leaders have learned to be careful with him on the phone, but the leak of these transcripts, that's going to have a chilling effect on the -- on our diplomacy and the ability of foreign leaders when they're on the phone with President Trump to feel like they can actually be candid.

BLITZER: And those conversations, a transcript like that, that's classified -- that's routinely classified?

KIRBY: Yes, they're not like highly classified, depending on the topic, because this was done on an unsecured line, but they're considered confidential. And that's why so many times, when you do these calls, you, together, work out what your readout's going to say. You sort of summarize the big pieces, but you let them be confidential. The president needs to be able to have honest, candid conversations with them. And, again, politics aside, he was pretty honest in these calls and he needs to have that ability. This is really abominable that somebody would leak these things in total like this.

[13:25:10] BLITZER: Let's talk about another phone conversation. A very different phone conversation. "The New Yorker" magazine has now just released some audio from Ryan Lizza's interview with Anthony Scaramucci, the now former White House communications director, which was very, very vulgar.

Let me play a little clip, David, from what "The New Yorker" just released.

(BEGIN VIDEO CLIP)

ANTHONY SCARAMUCCI, FORMER WHITE HOUSE COMMUNICATIONS DIRECTOR: And Reince is a (EXPLETIVE DELETED) paranoid schizophrenic, paranoiac. And what he's going to do is, oh, maybe Bill Shine's (ph) coming. Let me leak (EXPLETIVE DELETED) and see if I can (EXPLETIVE DELETED) block these people the way I (EXPLETIVE DELETED) blocked Scaramucci for six months. OK, but he leaked (INAUDIBLE) stuff on me. You know my financial disclosure's been leaked to Politico --

UNIDENTIFIED MALE: Yes, so --

SCARAMUCCI: Which is a -- yes, which is a felony.

(END VIDEO CLIP)

BLITZER: You hear his voice.

We read the transcript earlier. Ryan had released that. But it's still very dramatic to actually hear it.

CHALIAN: It is, although my imagination actually when I read the words initially, I thought Scaramucci was going to be much more enraged on the phone than necessarily he was there. But to hear him, a, just use the language and the vulgarity, fine. But, b, again, he's talking to Ryan Lizza, and you hear, not in that clip but another clip to the audio, how he's trying to go back and go back to get Ryan to reveal his sources. This is the White House -- new White House communications director. It's as if he's never worked with a reporter before. Like, why? Why would you go back and -- what reporter is going to say, oh, yes, here's my source? It just wouldn't happen. And yet you hear the repeated attempt for him to get (INAUDIBLE).

BLITZER: Yes, Ryan said it was an on the record conversation and he recorded it. That's why they have the audiotape.

KUCINICH: Well, right. And in D.C. there is one party consent, so it's completely legal to record anyone you're on the phone with. And it also showed a misunderstanding of his personal financial disclosures. Those were from the XM Bank. The reporter requested them fair and square like anyone could and received them. So the fact that he said --

CHALIAN: Not leaked.

KUCINICH: Not leaked. Not leaked at all. Not even leaked a little bit. Legally released to a reporter. So --

BLITZER: Certainly not a felony.

KUCINICH: Nope. Not even a little bit.

BLITZER: All right, guys, thanks very, very much. Jackie, David and John Kirby.

Coming up, the growing rift over how to handle the war in Afghanistan. I'll speak with NATO's secretary-general as the president's national security team scrabbling right now to unveil its new military strategy for Afghanistan.

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