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ERIN BURNETT OUTFRONT
Flynn Worried About Son As Russia Probe Intensifies; Trump Blames GOP Candidate Loss: "Did Not Embrace"; Trump Says He's A "Big Loser" Under Tax Plan. Aired 7-8p ET
Aired November 8, 2017 - 19:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[19:00:00] WOLF BLITZER, CNN ANCHOR: Thanks very much for watching. I'm Wolf Blitzer in the Situation Room.
Erin Burnett OutFront starts right now.
ERIN BURNETT, CNN ANCHOR: OutFront next, breaking news. President Trump's fired national security adviser now worried about his son's state in the Russia investigation. We'll tell you why.
Plus, Trump calling himself a big loser. But he is not talking about last night's election.
And the man who chronicled the most iconic and private moments of Barack Obama's presidency. The former chief White House Photographer Pete Souza OutFront on why he's now one of Trump's toughest critics.
Let's go OutFront.
And good evening, I'm Erin Burnett. OutFront tonight, we begin with the breaking news. Michael Flynn
fearing for his son. Multiple sources telling CNN tonight that President Trump's fired National Security adviser, General Michael Flynn, is worried. He's concerned about the legal fate of his son, Michael Flynn Jr.
Both men are already under scrutiny by Special Counsel Robert Mueller. Flynn's concern for his son could be something crucial. Could factor into cooperating with Mueller's investigation into Russian meddling, and as to whether he shares everything he knows about business dealings of key advisers to the president or the president himself. These are obviously crucial things.
Flynn Jr. is his dad's chief of staff and was actively involved in his father's consulting and lobbying work. He was with his father during a trip to Moscow where Flynn dined with the Russian President Vladimir Putin. Flynn Jr. meantime is defiant. He actually just tweeted this weekend, "The SGW, that would apparently refer to the social justice warriors, are out in full this morning. The disappointment on your faces when I don't go to jail will be worth all your harassment."
Meantime, General Michael Flynn, the father of course was fired as the president's National Security adviser 23 days after President Trump took office after misleading the administration officials including Vice President Pence about his conversations with the Russian ambassador to Washington.
Our Senior National Correspondent Jim Sciutto is OutFront live in Washington at this hour, and Jim, what are you learning? These are serious concerns and it is concerns about a child or a family member that could really open the door here.
JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT: Well, I'm told by multiple sources familiar with matter that Flynn has expressed concern about the potential legal exposure of his son, Michael Flynn Jr. who like his father is under scrutiny by the Special Counsel Robert Mueller. Flynn's concern certainly could factor in the decision about how to respond to Mueller's ongoing investigation into Russian meddling in the 2016 campaign and the business dealings of key campaign advisers. I'm told that Flynn's wife Lori shares his concerns about their son's possible legal exposure.
BURNETT: And Jim, you know, obviously there are some crucial questions when you talk about this legal exposure. What legal questions, what legal issues is the special counsel focusing on regarding Flynn?
SCIUTTO: This is what we understand. I've spoken to two witnesses who have been interviewed by special counsel investigators, and they tell me that questions regarding Flynn focus on his and his son's business dealings including their firm's reporting of income from their work overseas.
The Foreign Agents Registration Act, it's known s FARA, it requires that those acting as agents for foreign entities that they publicly disclose their relationships with those entities which could be companies or countries as well as the financial compensation for such work. As you mentioned, Erin, Flynn Jr., he was involved in his father's business. He served as his father's chief of staff, his top aide, involve d in the consulting and lobbying work at their firm which was known at the time as the Flynn Intel Group.
And that including joining his father on those overseas trips. He mentioned one, he showed a picture there when he dined alongside the Russian President Vladimir Putin at a black tie gala for R.T.
Flynn -- I should Flynn Sr. also under scrutiny by Mueller's team for undisclosed lobbying during the campaign on behalf of the Turkish Government, and Flynn's alleged participation and discussions about the idea of forcibly removing a Turkish cleric who's been living in exile here in the U.S. in Pennsylvania. In the past, I should mention that Flynn has denied that such discussions of removing this cleric ever occurred.
BURNETT: So what happens next in the investigation here? You know, obviously you got Manafort and Gates on one hand, you got Papadopoulos, you have the Flynns. What's next?
SCIUTTO: That's right. Well, to be clear, Flynn's business dealings, this investigation actually predated the special counsel, Robert Mueller. It's been the subject of federal investigation by the FBI since November.
It is not clear, we should say this very clearly, that either f the Flynns will the end face charges once the investigation is complete. I will also add that Flynn's attorney, he did not respond to multiple requests for comment for the story. Flynn Jr.'s lawyer, he declined to comment and you of course mentioned that Flynn Jr. himself had some defiant words on Twitter shall we say this weekend regarding the investigation.
BURNETT: He did and he's been an aggressive user of Twitter at least in the past back before his father's firing.
Thank you so much Jim Sciutto.
[19:05:01] And let's go now to Jeffrey Toobin, our chief legal analyst, Mark Preston, senior political analyst, and John Avlon, editor-in-chief for the Daily Beast.
Jeffrey, let me start with you. Flynn and his wife are worried about their son. And there is nothing more powerful than a worry about your child. So taking that into account, how likely is it Michael Flynn flips on the president to protect his son?
JEFFREY TOOBIN, CNN CHIEF LEGAL ANALYST: Well, prosecutors know how parents feel about their children, and they sometimes play hardball and use that leverage and say very explicitly, unless you plead guilty, we will charge your son as well as you in the criminal scheme that we've identified. And that certainly is a possibility here.
However, I think at this stage, it's very important to say that no one has identified any crime that either Flynn has committed. And it maybe that there will be no charges against either one of them. But certainly when you have two people under investigation, father and son, for similar kinds of violations, the possibility of the father pleading to spare the son is always going to be out there, and it would be irresponsible if prosecutors not to take advantage of that possibility.
BURNETT: That's what they do. I mean, Mark, clearly, General Flynn and his wife are feeling the pressure of this investigation, right? I mean, that's obvious from this reporting that Jim has. What does this tell you about where Bob Mueller is right now?
MARK PRESTON, CNN SENIOR POLITICAL ANALYST: Well, I don't think that we should look at the investigation and think that we're nearing the finish line. This is something that is very complicated. We have four active investigations right now looking into the whole Russia matter.
And look what we've seen from the off chutes of it. All these branches that are as Jeffrey has pointed out when it comes to General Flynn, some of those issues dealt with before the presidency, before Donald Trump took office and had to do with other things that he was involved in including giving a speech in Russia, so we've seen that. We've also seen a 12-count indictment presented against Paul Manafort and Rick Gates. Again, to genitally connected to the Mueller investigation, but in the end what I think we're seeing now is an incredible amount of pressure that's being put on people such as George Papadopoulos who he himself another Trump aide, who acknowledged lying to the FBI there, Erin.
BURNETT: So John, look, the president has had Flynn's back in the past, right? Even after he fired him, he had said words to -- and positive things, OK. Here he is.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: General Flynn is a wonderful man. I asked for his resignation. He respectfully gave it.
With all of that being said, I do think he's a fine man.
(END VIDEO CLIP)
BURNETT: If you're the president, how concerned are you tonight about Flynn flipping to protect his son?
JOHN AVLON, EDITOR-IN-CHIEF, THE DAILY BEAST: Well, you've got to remember that Flynn is in some ways, the spark that sets off this entire investigation. It's Flynn who Trump is talking about when he allegedly says to Comey, go easy on him, he's a good guy. And that's related to Flynn allegedly being on tapes early contacts with the Russians before the administration took hold.
So, this is somebody who is incredibly close to President Trump during the campaign. He was a close adviser, and at the same time, we found out he took at least a half million dollars from Turkey in retainers. Those are relatively small problems.
The bigger problem is how it relates to the Comey firing, the larger question of obstruction of justice, with which maybe out there. But Flynn is a key figure in all this. We just forget because he was out of the administration before month one.
BURNETT: How does all about the possibility, Jeffrey, of pardons play into this? You know, when you think about the president of the United States, look, he's got that liver (ph) in some of these cases and I know it's questionable in the case of a Paul Manafort. You've got space on their own cases whether it would work. But the power of the pardon could keep people quiet, right?
TOOBIN: Well, it could. I mean, -- but, you know, I don't want to overstate how much I can read Michael Flynn's mind. But the normal circumstance in a normal criminal investigation, a suspect says to himself, look, I'm going to get charged.
If I go to trial, I could get a really long sentence. I better cut a deal now. Plead guilty, cooperate.
I mean, that's the mental calculation that goes on every day in courtrooms in America. What is unusual about this case is that Michael Flynn and his son could say to themselves, I don't have to worry about going to jail. I don't have to worry about having -- being a convicted felon because I know that I have a pardon likely potentially maybe in my back pocket.
That's a tremendous advantage if you know you have it. Obviously, you know, based on what's public now, we don't know whether Donald Trump would ever pardon either of the Flynns. But it certainly -- he's certainly demonstrated with his pardon of Joseph Arpaio that he's willing to make politically controversial pardons. So the Flynns may think, well, I'm going to bet that I'm going to get a pardon, so I'm not going to cut a deal.
BURNETT: What do you say, John?
AVLON: I mean, look, you know, we've got the Arpaio precedent. The only thing that stopped previous presidents from doing this is really frankly a sense of decency and respect for the process.
[19:10:05] You know, there were -- Dick Cheney was lobbying heavily for Scooter Libby in entirely different context to get a pardon and George W. Bush never relented. But there's nothing to indicate that Donald Trump would be restrained by any such group. The question is how much can the folks who are putting their record on the line depend on Donald Trump's word or intention.
BURNETT: And Mark, you also have Flynn -- look, he's not been very cooperative. When you talk about Senate Intelligence Committee, right, he refused.
They said they want him to come in, he's refused. He hasn't been -- he has declined to comply with the Senate subpoena. That was back in May, right, then in September, he refused.
Do you think that if the pressure builds, he could go testify in front of the Senate Intelligence Committee?
PRESTON: Well, if he's able to cut a deal where he could go up there and get immunity in doing so, I think that's quite a possibility. And in fact, there was talk about immunity if you go back about five, six, seven months ago.
BURNETT: That's right. Yes, there was.
PRESTON: But the problem right now is, and I think Jeffrey and John really hit the nail on the head is the unpredictability right now of Donald Trump. Will Donald Trump give him a pardon if in fact he becomes indicted in what have you.
I think that's a tough gamble to go with given that we don't know what --
BURNETT: And how does Trump signal that, right? Because the last thing you could do (INAUDIBLE) of a signal that in any way that you're actually signaling it because then Mueller would find out about it.
PRESTON: Right. TOOBIN: By the way, if the president were to say in words or substance, especially if he said it in secret, don't cooperate because I'm going to give you a pardon, that alone --
BURNETT: That's obstruction, right?
TOOBIN: -- could be obstruction of justice.
AVLON: That would be a problem.
TOOBIN: Right. So, I think if the president is getting any sort of good legal advice at all, he is certainly not going to be promising pardons or even suggesting the possibility to anyone.
BURNETT: All right. Thank you all very much.
Well, the president is awake at all hours of the day whether promising pardons or not. Here's what we know. Taking a beating in the Democrat's sweeping election wins last night, but tweeting this picture about an electoral victory. This tweet came at 2:00 in the morning.
Plus, Trump calls himself a big loser when it comes to the new tax bill. Really? Well, we ran the numbers such as they are, Mr. President, and it looks like in this case, you're a big winner.
And Barack Obama, creating a stir in court today showing up for jury duty. Seriously? Are they going to let him on a jury?
[19:16:09] BURNETT: Tonight, President Trump marking the one year anniversary of his own election victory. Tweeting, quote, congratulations to all of the, caps, deplorables and the millions of people who gave us a, caps, massive 304-227 Electoral College landslide victory.
So, you might have thought it came from a year ago, but no, no, no. Let me tell you, not only did it not it come from year ago, it did come from last night and it came at about 2:30 in the morning, Beijing time. So at nearly 2:30 in the morning in Beijing, President Trump is not only awake and tweeting about his big election night a year ago. That's what he's doing.
Talk about lost in translation. Obviously, what really mattered in American politics at 2:00 a.m. in Beijing was a Democratic blowout. Democrats beating Trump's backed candidate in the Virginia governor's race, that state, blue. And they picked up the governor's mansion in New Jersey which was currently occupied by the Republican Chris Christie.
OutFront now, former communications director for the Ted Cruz presidential campaign, Alice Stewart, and former counselor to President Bill Clinton, Paul Begala.
Alice, let me start with the drama of this moment. Two-thirty in the morning in Beijing, and the president is tweeting a picture about -- as if it were a year ago. About a big win when obviously that was not the story last night.
What do you make of that? He's obviously obsessed.
ALICE STEWART, FORMER COMMUNICATIONS DIRECTOR, TED CRUZ CAMPAIGN: I think it's unfortunate, Erin, and that he's on a very important foreign policy trip, and I think it's been a very successful trip with regard to the relationships he's building on and growing on and really being forceful with North Korea. And unfortunately, he's off tweeting about something that it's really not great timing given the election results that we had yesterday and clearly, I think he's trying to put the best face on this.
But the reality is, while he did certainly won tremendous Electoral College victory last year, he didn't win the popular vote and those were the people he needs to really focus on as expanding that base and growing that base, and it's just not working out the way it should be. And I think the results we had in Virginia and in New Jersey and down ballot in Virginia more specifically were an indication that people are really not satisfied with not just the attitude out of Washington and the White House but the accomplishments or lack there of that we've had.
BURNETT: Look, there's a significance coming -- you know, you're a Republican, you're a tried and true Republican. You've been supportive of this president so I think it's significant what you're saying.
I mean, Paul, look, coming into this race, the Republican candidate in Virginia, Ed Gillespie, had not appeared with President Trump, right? He had been concerned that would be a liability. But Trump did tweet in favor of him, tweeted to vote for him, right? That's what he did.
But then last night, you know, again in the middle of the night, the president tweeted quote, Ed Gillespie worked hard but did not embrace me or what I stand for. Don't forget, Republicans won four out of four House seats and with the economy doing record numbers, we will continue to win even bigger than before.
So what he's saying is, first of all, I know I told you to vote for the guy, but whatever, he's a loser. Forget that part. He's saying he didn't embrace me or he would have won. Is that possibly true?
PAUL BEGALA, FORMER CLINTON WHITE HOUSE COUNSELOR: No, I kind of hate to -- you know what, first of, I just want to say how grateful I am that Alice is with CNN and not with President Trump. Because everything she said was really, really smart advice. And I'm hoping -- I know he's a cable T.V. addict and I know he watches your show but I'm hoping he's not listening. Because his -- Alice is right, his best move here, he's on the international stage and even I as a hardcore Democrat, I want my president to succeed.
You know, he's my president, too. The more he pictures himself in those settings, the more unassailable he becomes even for me but he's not doing that. He loves to get down into the mock and gutter of politics and the notion that somehow, Ed Gillespie would have prospered by embracing President Trump more, it's nutty.
I suppose Typhoid Mary wanted more typhoid and Donald Trump wants more Trumpism, but Trumpism is what killed Ed Gillespie.
[19:20:06] He embraced President Trump's really divisive -- I have to say racist ads that Ed Gillespie ran about immigration. Outrageous ads trying to tie his opponent to child pornography. Insane Trumpist stuff and the people of Virginia rejected it, and I think that Republicans need to look really hard at what they've done wrong as Democrats have been doing for the last year after Trump beat us in 2016.
BURNETT: So Alice, how do you see it? I mean, look, 33 percent of Americans in a poll we have tonight, 33 percent of Americans say Trump deserves to be re-elected in 2020. That's obviously a really bad number.
However, however, it does match roughly the support that the now president had before the election last year. Does it signal, Alice, that yes in the broader electorate, there is repudiation of Trump, but among that core base, that is rock solid?
STEWART: He had that core base regardless of what he said or what he did throughout the primary and up through the general election, and I applaud him for that. He's working hard to really continue to galvanize that core support. But the reality is politics is about game of addition and not subtraction and not staying the same.
And it's really important and I think they can do it if they have accomplishments on tax reform and possibly with regard to healthcare, they need to broaden the base. They need to expand on the core voters that he got in the general election because it would be helpful not only for him with regard to his re-election this 2020, but certainly for Republicans running in the midterms next year.
They need to take a lesson from what happened yesterday, start having some legislative accomplishments, certainly tax reform is a great place to start.
BURNETT: So the president obviously is saying if Gillespie hadn't distanced himself, basically I'm not the thing that stunk, it was you, Ed Gillespie, right? And he's saying, remember what happened a year ago when I won big. It's not just you, Alice, there are other Republicans on Capitol Hill right now who say that is not at all the way to interpret this, that this was a referendum on the president of the United States. Here are two of them.
(BEGIN VIDEO CLIP)
REP. SCOTT TAYLOR (R), VIRGINIA: I think that last night was a referendum. I don't think there's any way that you can look at it in a different way.
SEN. ORRIN HATCH (R) UTAH: It's not helpful, I'll put it that way. It's not helpful to our agenda.
(END VIDEO CLIP)
BURNETT: OK, that's Orrin Hatch and Scott Taylor. Four different House Republicans meantime, Paul, have announced they're going to retire this week. Some of them in safe districts, but nonetheless it sort of become a stampede. Are we going to see more of that?
BEGALA: You will. It's a canary in a coal mine. I've lived through landslides against my party in midterms in 1994, in 2010, in 2014. It always begins with retirements.
Some in safe seats but some not. Frank LoBiondo (INAUDIBLE) from New Jersey. That's a very swing district. You're going to see more and more.
And it's not just the president, and I think people need to understand this. It's not just, yes, he's divisive (INAUDIBLE) and he's pushed away by the way one out of four of the people who voted for him. One out of four.
And they voted for him knowing he was divisive. They know -- voted for him after he insulted POWs and people with disabilities and bragged about assaulting women.
Why have they left him? Because of that agenda that Senator Hatch is talking about particularly Medicaid. The biggest issue in Virginia yesterday was healthcare.
BEGALA: And trying to destroy Medicaid as we know it, which I think the bill would have done, has hurt the Republicans enormously. That's different from just Donald Trump's eccentricities or his tweets. That's substance.
I will tell you I think that the tax bill is going to be a gift to Democrats running against house Republicans as well. Because it's not going to be good for Trump voters.
BURNETT: Well, I will leave on that note because you mentioned the tax bill and it is right now at the center of whether this president can fly or whether he will fail.
Next, we're going to talk about that with the man in charge of it. Trump insists he has nothing to gain from the new GOP tax plan. He says that he is a loser, a big loser. Well, we're going to check the numbers and tell you the truth as it exists.
And Democrats dominate at the polls. Women running in unprecedented numbers. Many coming out ahead. Did Trump help them?
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: I just knew that everything that Donald Trump represented could be my own backyard.
(END VIDEO CLIP) (COMMERCIAL BREAK)
[19:27:36] BURNETT: President Trump calling himself a big loser. And he's not talking about last night's electoral results. Trump at a surprise call the Senate Democrats revealing that his accountant told him that under his tax plan, he'd lose out of his taxes going up and he used the words, big loser.
Now, this is not the first time Trump has made this claim. Here he actually is speaking with me more than two years ago about -- on his tax plan.
(BEGIN VIDEO CLIP)
BURNETT: You, will you pay more money? Will it be millions and millions, hundreds of millions? How much more will you pay?
TRUMP: I will probably end up paying more money. But at the same time, I think the economy will do better so I'll make it up that way. But I will probably end up paying more money.
(END VIDEO CLIP)
BURNETT: It would be nice to believe that but without Trump's tax returns, of course we only have his word to go on. His word and some information such that we have frankly that make him sound like a bit of a bluffer and look like a big winner.
A few pages of Trump's 2005 1040 tax form became public in March and in that year you see, Trump paid $38 million in taxes. It's a lot of money. The return included 31 million though that Trump owed because of the alternative minimum tax. So 31 of 38 was the AMT, Trump's tax plan of course eliminates the AMT, so he'd save millions of dollars there.
The plan also slashes the tax rate for what's called a pass through entity. That's basically reporting business income on your personal tax return.
According to this letter from Trump's tax attorneys that we found dated from March of this year, Trump has more than 500 of these entities. So when his tax plan slashes taxes on them for the high earners from 39.6 percent to 25 percent, well, Trump would be a big winner.
OutFront now, the director of the Office of Management and Budget, Mick Mulvaney knows the ins and outs of this plan better that than anyone in this country. You are the person to talk to Director and I appreciate your time.
So let's get straight to the latest CNN poll. In the poll that we have, 21 percent of Americans think this plan will make them better off, 21 percent. Are they all -- everyone else who thinks this is not going to be good for them, are they wrong?
MICK MULVANEY, OFFICE OF MANAGEMENT AND BUDGET DIRECTOR: Yes, the other 79 percent of the folks who think it's not going to be better for them are actually wrong. It doesn't surprise me. A lot of the news coverage has been very negative. Even today, we hear stories more about the infighting within Republicans on taxes which I'm not just hearing here in Washington, D.C., and not about the benefits to people.
So there's been so much negative attention and a lot of it inaccurate. I think there was a Post story put out yesterday about the tax policy center paper that was ultimately retracted, but that still got a lot of coverage before it was corrected. So there's just been a lot of negative coverage, that's not unusual in this political day and age. So, it doesn't surprise me. We're plugging ahead and absolutely confident that everyone's going to benefit from this.
ERIN BURNETT, CNN HOST: Yes. So, the Tax Policy Center, I believe the numbers where they had put out saying 30 percent of Americans over the next 10 years would see a tax increase. You're right, they did add it (ph). But they still say 25 percent are going to get a tax increase.
MULVANEY: And, again, I'll say the same thing I said to you and to other folks here in the last couple of days. If our numbers confirm that, by the way, in Washington, D.C., you can go out and hire anybody you want to, to get them to say whatever number you wanted to say, right?
MULVANEY: Our numbers here at the White House actually show the same thing, if they show taxes are going up on the middle class, on the House plan, on the Senate plan, on some combination of the two, we won't sign it.
The president's principles are fairly straightforward. He wants lower taxes on hard working Americans on that average middle class family and he wants it to be easier for them to pay their taxes. That's one principle. The other is he wants that lower corporate rate.
If those two things are violated, he's not going to sign a piece of legislation. So, I know there's been a lot of discussion about what if and, you know, what assumptions you can make, at the end of the day, if we really believe this is a middle class tax increase, he's not going to sign it.
BURNETT: So, let me ask you a couple of questions in that front. One, just one of the examples here, right? The deduction for people with very high medical costs. This affects 8.8 million Americans in the latest year, we have, right? Eight-point-eight million Americans had $87 billion worth of deductions in their taxes in 2015 because of this, right? These are people under great medical duress. High out of pocket costs. Many of them are senior citizens.
But you're eliminating that deduction for them.
MULVANEY: I'm not sure if a lot of them are senior citizens because I think senior citizens who are probably covered by Medicare, I don't have that same report in front of me.
But keep in mind, what you've just done is assumed away a big piece of the tax bill. And don't feel bad. A lot of folks do that. They focus on a piece of the bill that they don't like and I want to hammer on that piece again and again and again.
BURNETT: But it does affect millions of people, right? I understand there's winners and losers. But, of course --
MULVANEY: No, no, it doesn't, because what you --
BURNETT: -- you know, we got to talk about people who might lose.
MULVANEY: True, but what you're ignoring is the fact that we're doubling the standard deduction. You have to itemize in order to take those deductions. And what I don't have -- again, you've got to report. I don't.
But my guess is, what it doesn't show is how many people would actually choose not to itemize that particular expense because they're better off taking this larger standard deduction. That goes to -- that's the same, Erin, by the way, for your mortgage interest, your state and local taxes. If you go from $12,700 to $24,000, that's an additional almost $12,000 worth of automatic deduction. You don't even have to ask what it's about. And if you're getting a less than that now in the deduction you just talked about or in your mortgage interest or in your state and local, you don't care because we're actually getting a larger deduction than you would under the old system.
BURNETT: So, Director, there's something fundamental that I want to try to understand here because you said that the president wants hard working Americans, right, to get a tax cut.
BURNETT: Fundamentally in the tax bill that you have here, right, someone who inherits money with your estate tax cut or who gets investment income as the main source of their income, they pay a lower rate than a lot of people who work every single day for their paycheck. That's just the reality of the tax rates.
That is a fundamental point here, right? I mean, it sounds like just in this bill. That you u all believe that hard work and going to work every day is worth less than someone who lives off a trust fund because the two rates show that.
MULVANEY: Yes, they -- no, they don't. And keep in mind, a lot of folks do this exact same thing. They look at dividends and go, oh my goodness, only trust fund babies live off of dividends. That's absolutely not true.
Many folks in this nation are invested heavily in dividends. If you have a pension fund, if you're a hard working labor worker in this country and you participate in your labor union's pension, you are counting on dividends. If you are retired, you're counting on dividends.
MULVANEY: So I absolutely dismiss this predilection to say, oh, if it's a dividend, it must be a trust fund baby. That's just not the way the world works. Many Americans are invested in that sort of things that you just mentioned.
BURNETT: You have a fair point there, but it is true that if you are living off dividend income as a very wealthy individual, or you are going to benefit from the estate tax going away and you're a really rich person, you are going to benefit big time. And you are going to benefit a lot more than somebody who's getting some income from an AT&T dividend, some senior citizen, I mean, right? That's just the math.
MULVANEY: Sure. Well, let's talk about -- pick one of those. The estate tax, for example. Why is -- why is -- this is a fundamental question. This is a policy question. You could look at it in terms of the politics of division and envy and economics, however you want to call it.
But let's look at it in terms of just flat out policy. Should death get the IRS involved in your business? Should death be a taxable transaction?
I don't think it should. We don't think it should. I think many Republicans, many Democrats, many swing voters don't think that death should be a taxable transaction. If you make money, fine. We tax you on that. You want to sell a stock, that's a choice you make, fine, you pay tax on that.
[19:35:00] But you die, most of the times, that's not a choice. And it should not invite the IRS into your life.
So, let those, the estates pass to the heirs. If the heirs decide to then sell whatever happened to be given to them in the estate, then you pay tax then because they made that choice.
BURNETT: OK, look --
MULVANEY: I think it's just good policy. It's not the politics of sort of socioeconomic fighting.
BURNETT: So I have a letter here from the president's tax attorneys, which we actually have. It's related to Russia. They were certifying that he didn't have any business with Russia, OK?
And in it, it actually says that the president of the United States is the sole or principle owner in more than 500 separate entities. A tax expert we spoke to today tells us almost those are most likely pass- throughs.
Now, under this legislation, obviously, pass through taxes would go to 25 percent, the way that they're envisioned now. So, for the president, that would mean theoretically, he'd go from top bracket of 39.6 percent to 25 percent. That's a massive tax cut for him.
Why don't the American people have the right to know? How their president benefits or is impacted by this bill?
MULVANEY: Yes, I'm not going to relitigate the president's taxes. That's a political issue that got washed out as far as I'm concerned in the election, and I don't get involved in the politics in my work at the Office of Management and Budget.
But I'm happy to speak to you about the impact of the pass-throughs. Keep in mind that under the proposal, or at least as the house laid out, this was not the White House proposal that the House of Representatives set forth. Seventy percent of all of that pass- through income that the president has, at least 70 percent, would be taxed at the highest individual rate that he would have any way.
So, let's assume he's operating at the very highest income levels. The tax bracket would be 39.6 percent most. Seventy percent of his pass through income would still be taxed at that very highest rate.
So, it's -- if you're implying he's going to get a tax cut across the board at all of his pass-throughs, that's just not consistent with what the House said. I don't know what the Senate is going to do. By the way, I still think that the pass-through rate is one of the things that is probably going to be the most difficult to work out between the House and the Senate and the White House.
BURNETT: Right. Yes.
MULVANEY: So, it's probably too early to say, look, this is what the pass through treatment is going to be.
BURNETT: So, Director Mulvaney, do you believe that the president when he said he is, quote, a big lose from this tax bill, which is what he has said, do you actually from what you know believe that to be true?
MULVANEY: I have no idea how the president has structured his income. I have no idea how it's worth. Honestly, I don't think it's any of my business.
I will tell you this, I will tell you that by virtue of the fact that the president lives in -- has some very expensive properties and some very high tax states, New York specifically, he's going to -- he's going to pay a fairly substantial price if they get rid of the state and local tax deductions. Whether or not that is offset by other reductions, maybe it is, maybe it isn't. Again, I don't know how it's structure.
But all I'm telling you is it's not fair to look at one part of the tax proposal and say because of this, the president's going to pay more or because of that, the president's going to pay less. You can't do it that way. You have to look at it as one giant tax proposal.
BURNETT: Director Mulvaney, thank you so much. I appreciate your time tonight. MULVANEY: Thanks, Erin.
BURNETT: And next, an unprecedented number of women running for office and winning and many have one thing in common.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: We got a message, Trump has heard and heard it clear.
(END VIDEO CLIP)
BURNETT: And no excuse from President Obama when it comes to injury duty. He showed up to a Chicago courthouse today.
[19:42:04] BURNETT: Tonight, a surge of women elected to public office last night after an unprecedented number of first time female candidates ran, and it appears that is because of the president. Many of these women were fueled by their feelings about him.
Kyung Lah is OUTFRONT
JENNIFER CARROLL FOY, VIRGINIA DELEGATE ELECT: Racism, xenophobia, sexism, this is how we respond.
KYUNG LAH, CNN CORRESPONDENT (voice-over): Call this the after shock to Trump's earthquake, newly elected women storming into Virginia state government from Jennifer Carroll Foy.
FOY: We sent a huge message. Trump has heard it and heard it clear.
LAH: To Kathy Tran, Virginia's first elected Asian-American woman.
Danica Roem, elected as the state's first openly transgender lawmaker.
UNIDENTIFIED FEMALE: This one's for you.
LAH: And Hala Ayala.
HALA AYALA, VIRGINIA DELEGATE ELECT: We are the talk of the nation.
LAH: Receiving calls of congratulations. She's one of two Latinas to be elected to Virginia's House of Delegates for the first time. Ayala is a first time candidate motivated to run because of Trump.
AYALA: I didn't know what was going to happen with our nation. I was afraid. I didn't know what's -- you know, I just knew that everything that Donald Trump represented could be in my own backyard.
LAH: In Virginia of the more than a dozen Republican seats flipped, 11 were won by women. But it's beyond this one state. Across the country, voters elected women mayors from Manchester, New Hampshire, to Charlotte, North Carolina, to Seattle, Washington.
STEPHANIE SCHRIOCK, PRESIDENT, EMILY'S LIST: That's what we saw in Virginia yesterday. A real stand of women African-American women, Latinas, white women living in suburban and exurban communities all coming together and saying no. We are not going backward in this country.
LAH: The women's march, the day after Trump's inauguration may have been the beginning, an anger that moves protesters on to the streets.
UNIDENTIFIED FEMALE: How we're getting money and where it's coming from.
LAH: And to training for politics. Across blue and red states, organizations training women to run for office have seen exponential growth since November 2016.
ANDREA DEW STEEL, PRESIDENT, EMERGE AMERICA: Women happened. Women rose up after the election of the most misogynistic president in history and they decided to run, and they ran great races and they unseated the Republicans.
Hala Ayala admittedly a little stunned after her historic win in Virginia predicts more ceilings crumbling throughout the Trump era.
AYALA: I know a lot of us elected yesterday don't think that our fight ends here. That we must continue to fight and work with next year's election. We're going to work twice as hard.
LAH: And what she's talking about there is bench. Women once in state and local office and eventually run for national office and advocates are saying they are training thousands of women, Erin, in these training courses, a new generation of engaged women -- Erin.
BURNETT: All right. Thank you very much, Kyung Lah.
[19:45:00] And next, President Obama's long time photographer, trolling President Trump on Twitter, talking to us about it as President Obama goes to jury duty today. Imagine being there.
And victims of the Texas church shooting honored at a prayer vigil which is about to get underway.
BURNETT: Former President Barack Obama in court today. The 44th president reporting for jury duty in Chicago, showing no citizen is immune. He still owns a home there.
Most likely, he was the only prospective juror to arrive amongst a fleet of black SUVs. All eyes were on the former president. He apparently was there for half a day. He shook hands.
A lot of people wanted to capture him on their cell phone phones. He was dismissed a short time later, did not have to serve on a jury.
OUTFRONT tonight, the man who has captured many of the former president's most iconic and private moments, Pete Souza, who was then the chief official White House photographer. His new book, "Obama: An Intimate Portrait", is a collection of these photographs from his time in the White House.
BURNETT: What I think is interesting, Pete, you actually first met Barack Obama four years before he was in the White House. He was the senator. He had a windowless office in a picture you took.
Four years and 16 days later, inauguration day, you got that first picture of him realizing that this is his new office, the Oval Office.
[19:50:09] About eight years later, in the final months of the administration, you photographed him again in that same place.
How did he change from that first day with the basement office, no windows until the end?
PETE SOUZA, CHIEF OFFICIAL WHITE HOUSE PHOTOGRAPHER FOR PRESIDENT OBAMA: Yes. I mean, you go back to January 2005 and you go back to even today, and the core of his character is still the same. He hasn't changed one bit in terms of his character. He really hasn't.
BURNETT: You were also able to capture moments that are so importance to the person and to the presidency and some of them very intimate family moments. You know, there's several pictures that you share of Barack and Michelle, there's one of them before one of the inaugural ball. And then there's the two of them backstage waiting to be introduced at a reception.
You were able to watch them in these -- as much as any moment between them could be, unscripted moments.
SOUZA: They were very playful together. And the interesting thing about the job of the White House photographer is, I do get to see him, the president, at the national security meetings. But I do get a glimpse of their family life and what it's like on a vacation, all the different compartments of his life.
So, because of that when you put all my pictures together, you get a sense of what he's like as a person, as you said, and not just a president.
BURNETT: And he also was able to laugh about some thing about himself. He's got big ears.
SOUZA: Sure, yes.
BURNETT: And he's open about that. Tell me about this picture. He actually asked you for a copy of this one.
SOUZA: So, the first time he saw this graph he just stopped and started cracking up. And he said -- he said, look at that, the two most famous sets of ears in Washington.
BURNETT: That sounds like a Donald Trump-sort of a existent almost.
So, you know, on that, I want to ask you -- look, you were not in a political role, obviously you were, you were photographing President Obama. You also were photographing Ronald Reagan, right? So, the point is, you're a person who takes pictures and chronicles of presidency, that's what you do. But you have become more open about what you think when it comes to President Trump. He visited Texas after Hurricane Harvey and he said something that got you to comment.
Let me just play what he said first.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: What a crowd, what a turn out, this is historic, it's epic what happened. But you know what, it happened in Texas and Texas can handle thing.
(END VIDEO CLIP)
BURNETT: Your response was to put out a picture of President Obama with a caption. And part of your caption read: President Obama with the victim of Hurricane Sandy. That was the picture. There are no Democrats or Republicans hurting in Houston. There are just Americans. At a time like, this shouldn't be about selling baseball hats, or commenting on crowd size. It's about helping our fellow human beings.
What made you chose to speak out in that way?
SOUZA: I'll say this, I'm now a private citizen and I think I have the right to post public domain photos and I think I've been very respectful and very subtle if the way I do that. I just would rather let me Instagram feed speak for itself rather than weigh in on what I was trying to say or what my interpretation was.
BURNETT: So, I just want to show a couple more.
BURNETT: So, Melania Trump, you know, the moment when they're walking off the airplane on the trip to the Middle East, appearing to swat away Trump's hand. In a response, you posted a picture of president and Michelle Obama holding hands. And then President Trump posed with a picture with a pope, and you posted a picture of president Obama with the pope, with the caption: mutual admiration, 2016.
I know you're letting it speak for itself but it is -- it is the case where a picture in your view can say more than words.
SOUZA: I think the one thing that's great about photography it's subjective and people read into it what they want.
BURNETT: So, and obviously you put your captions. I know the point you're making. President Obama and you are friends. You -- he wrote the foreword to
your book. In it he wrote: Over those eight years, Pete became more than my photographer. He became a friend, a confidante and a brother. We broke up long days with stories and laughs. We broke up long overnight flights with fiercely competitive card games. I consider him and Patty, referring to your wife, as part of our family.
Are you still speaking with him or seeing him now that he's left office?
[19:55:01] SOUZA: Yes. I went down to Texas with him for that benefit concert for hurricane victims. When I heard all five former presidents are going to be there, I thought this was a historical moment.
BURNETT: And what did he say when you told him you were doing this book?
SOUZA: He was -- he was excited. He was anxious to get a copy. When we flew down to Texas, was that two weeks ago, I hadn't yet given him a copy so he was little testy with me. Where's my copy, you know? So, I finally gave him a copy when we got back from Texas.
BURNETT: All right. Well, Pete, I really appreciate your time. Thank you so much.
SOUZA: Thank you for having me. I really appreciate it.
BURNETT: And next tonight, a prayer service about to begin in Texas for victims of the shooting in Sutherland Springs. The Vice President Mike Pence is there.
BURNETT: A prayer service is about to start as you can see in Sutherland Springs, Texas, where 26 people including an unborn child were killed in a horrific massacre. Vice President Pence is in emotional private meetings with survivors and their families. He came to a community wracked with grief. He said evil had descended upon it.
(BEGIN VIDEO CLIP)
MIKE PENCE, VICE PRESIDENT OF THE UNITED STATES: We'll get through this, we'll get through this through faith and we'll get through this on the basis of the good and strong people of this community and of this great state.
(END VIDEO CLIP)
BURNETT: Certainly words of great meaning for those there. The church service will go on this Sunday at the First Baptist Church, the first since the shooting.
Anderson starts now.