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Bannon: Trump Jr. Meeting at Trump Tower "Treasonous"; Trump Responds to Bannon Comments; Biden Reacts to Trump's Nuclear Tweets Against North Korea; Bannon Talks of Trump's Efforts to Woo Putin; Pro-Government Demonstrators Hit Streets After Iran Blames U.S. for Anti-Government Protests. Aired 1:30-2p ET

Aired January 3, 2018 - 13:30   ET

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


[13:30:00] DAVID CHALIAN, CNN POLITICAL DIRECTOR: This was someone intimately involved, from the general election campaign when Donald Trump was like 12 points back in the polls in August of 2016, general election campaign through the transition into the presidency. This is somebody who was clearly part of the inner circle.

WOLF BLITZER, CNN HOST: He goes on and he accuses him of being a leaker, as well. And the statement about his former chief strategist, I guess, it makes it clear there's no love lost any longer

CHALIAN: We have seen deterioration of the relationship over time. Steve Bannon did fall out of favor. There was the battle between Bannon and Jared Kushner and Ivanka Trump. Obviously, Steve Bannon was never going to win that battle in the heart and mind of Donald Trump. Because it's his daughter and son-in-law, Wolf. And ultimately, we saw the president sort of hang him out to dry and get rid of him.

But a statement like this, which doesn't actually address Steve Bannon's characterization that was reported in the Michael Wolff book, the quotes about how Steve Bannon saw that Trump Tower meeting in June of 2016, that it was treasonous, Donald Trump doesn't deal with the specifics of what Steve Bannon described in the quotes to Michael Wolff. He wholeheartedly dismisses him and cuts him off at the knees.

BLITZER: Two instances also jump out. "Steve doesn't represent my base. He's only in it for himself." "Steve pretends to be at war with the media, which he calls the opposition party. Yet, he spent his time at the White House leaking false information to the media to make himself seem far more important than he was."

And then he adds this. And I want your reaction. "It is the only thing he does well. Steve was rarely in a one-on-one meeting with me and only pretends to have had influence to fool a few people with no access and no clue whom he helped write a phony book."

Phony books, maybe he's referring to this current Michael Wolff book about to be released.

CHALIAN: I'm sure that's what he's referring to. We have to learn from the White House sort of a detailed itinerary, if you will, of President Trump's communication with Steve Bannon since he left the White House. After the president fired Steve Bannon, we know they have had conversations since. Why, if the president believes he is a total leaker of false information, why was he still speaking to him after he left? And why does he claim he has nothing to do with him if, indeed, the president had communication with him after he left?

BLITZER: Ted Lieu is still with us from California.

Let me get your reaction. A pretty stark, bold statement from the president of the United States. Not from a Democrat, not from a member of your party, but from the president of the United States, clearly attacking Steve Bannon, who now runs "Breitbart" once again, as someone who has, quote, "lost his mind."

REP. TED LIEU, (D), CALIFORNIA: Wolf, during Watergate, the administration would issue statements like this, which I would call a nondenial denial. Basically, the president is not denying what Steve Bannon said. He's attacking the messenger, Steve Bannon. The reason he can't deny what Steve Bannon said is because we have e-mails about this meeting. Now we also know why the president and his son, Trump Jr, tried so hard to cover up what happened at this meeting. If you remember, earlier last year, they issued two press statements about this meeting that were false and misleading. They said the meeting was just about Russian adoptions and nothing about campaigns. That was totally wrong.

BLITZER: Our White House reporter, Kaitlan Collins, is with us, as well.

Kaitlan, you've carefully read not once or twice but probably three times this statement from the president of the United States. It's a formal statement. This is not a tweet.

KAITLAN COLLINS, CNN WHITE HOUSE REPORTER: Certainly not. We rarely see a statement like this, especially blasting someone that worked inside the White House with the president for several months. Before that was essentially the CEO of his campaign. But we've seen this before with the president and Steve Bannon. He doesn't like Bannon taking too much credit for things or anything he's accomplished. We've seen a lot of that in, especially in the excerpt of the Michael Wolff book out today. We see that echoed here in this statement by the president, saying Steve Bannon only came after I defeated the other Republicans. And he didn't do that much to help me. Quite a striking statement from the president that we rarely have seen in this kind of a White House.

BLITZER: Yes. The president normally would not do that kind of a statement.

My sense is he is angry, very angry at Steve Bannon because of the attacks on his son-in-law. Jared Kushner, on Ivanka Trump, his daughter. Once you start going right after his own family, for the president, that's a big deal.

COLLINS: We know that's something the president strongly dislikes. It's been one of the biggest sources of his anger regarding this entire Russia investigation, is that he fears it will reach into the inner circle, his family, not only Jared, but his son, Donald Trump Jr. And in that, those statements from Steve Bannon we saw on the record today, he goes after them multiple times. We weren't so surprised by the Kushner ones because we've known about this feud between Steve Bannon and Jared Kushner for some time. They're still startling to be on the record. And in the statement about Donald Trump Jr, saying he believes they're going to "crack him like an egg" is certainly something that didn't sit well with the president. We're waiting for a response. This is quite the response from the president.

BLITZER: The fact he used the word "treasonous" talking about Donald Trump Jr and the decision to have had meeting and not call the FBI.

Give me your thought.

[13:35:16] CHALIAN: That is a charge that is clearly what Donald Trump's reacting to. That is a charge and a characterization that has the potential to stick. Obviously, Steve Bannon may have -- I think he says he wasn't in touch with Russians, shouldn't be a witness in this investigation. These are his personal characterizations about what he saw at that meeting. Having somebody who did work in the White House attach that kind of description, Wolf, to that meeting is politically damaging.

It's also worthy of noting, remember, when Steve Bannon left the White House, he was careful in public to not criticize the president. He had no problem criticizing other staff or the West Wing and how it operated. But he remained careful to not publicly criticize the president when he left, I think, because he feared this kind of retribution that the president could deliver.

BLITZER: The president flatly said he was fired. Didn't say he resigned. He was fired.

COLLINS: It's interesting because when Steve Bannon did leave the White House, there was a lot of speculation about something exactly like this scenario playing out. And a lot of the Bannon allies assured people he was going to fight for Trump outside of the White House regarding the Senate and the primaries, things like that. Now we're seeing this escalate between the two of them, like a lot of people predicted would happen when Steve Bannon, who has his own media site and not afraid to say things on the record, would say things like this.

BLITZER: Everybody stand by.

We're following the breaking news. The president of the United States personally responding to his fired adviser's attacks on him and his family. Much more on the breaking news right after this.

(COMMERCIAL BREAK)

[13:40:50] BLITZER: We're following the breaking news. An extraordinary statement from the president of the United States attacking his former chief strategist, Steve Bannon. I'll read the first two sentences: "Steve Bannon has nothing to do

with me or my presidency. When he was fired, he not only lost his job, he lost his mind."

Dana Bash is with us, as well.

There are going to be a lot of Republicans applauding the statement from the president.

DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: That is something that can't go without being noted and underscored and underlined, that Mitch McConnell, the Senate Republican majority leader. It's like Christmas all over again for him. Because he and other incumbent Republicans, establishment Republicans, however you want to put it, have been beating their heads against the wall begging the president to try to stop Steve Bannon. Because Steve Bannon has made very clear that all of 2018 is all about trying to get rid of incumbents, get rid of Mitch McConnell, run Republicans in primaries against these incumbents to try to undermine the establishment, the Republican establishment.

The president of the United States has just, from the perspective of Mitch McConnell and others, put Bannon in his place, and made the power that Steve Bannon may or may not have with these Trump voters a big question mark. Because remember, Steve Bannon and his whole M.O. has been about the movement, has been about Trump's America, has been about those who were the forgotten Americans.

And that specifically is what this statement refers to about the fact that the forgotten Americans that the president -- that Steve Bannon is trying to also continue to use and to convince to vote against the establishment are those that are Trump voters. So those voters have to basically make a decision now. Do they stick with the president who is now saying I'm done with Steve Bannon or do they continue to believe in the cause that Steve Bannon is pushing?

BLITZER: Yes, and in his statement, formal statement released by the president, "Steve, Steve had everything to do with the loss of a Senate seat in Alabama held for more than 30 years by Republicans. Steve doesn't represent my base."

BASH: And there's another thing I was just reminded of, which is that this -- these quotes that Steve Bannon has out there in this new book, this is not in a vacuum. This isn't the first time Steve Bannon or people close to Steve Bannon have been quoted saying things or doing things that the president and those who are still around him believe undermine his presidency and don't reflect well on his presidency, but a number of articles. And the other question that people sort of in Trump world are asking is whether or not these quotes were given to the author while he was in the White House or whether it was after he left.

The other thing I want to mention, and, Wolf, you and I were both looking as we were coming back from break at "Breitbart," because Steve Bannon runs "Breitbart" again. It is a very influential site. It's a news site for conservatives who are almost 100 percent Trump supporters. So now what happens to that site? Is it still as influencing? Is it still part of the Trump echo chamber or is it different? They haven't reported as of yet.

(CROSSTALK)

BLITZER: Clearly, the president is at war with Steve Bannon.

Ted Lieu, the Democratic congressman from California, give me a final thought before I let you go. Congressman, extraordinary development, you got to admit.

LIEU: Yes, Wolf. Based on Bannon's explosive comments, as well as the president's inability to deny his characterization of the Trump Tower meeting, I'm calling on Congress to subpoena Steve Bannon to come testify. I believe Steve Bannon would welcome the opportunity to tell his story to America under oath.

[13:44:47] BLITZER: Ted Lieu, thanks so much, as usual, for joining us.

Congressman Ted Lieu, of California.

There's a lot more developing right now. The former vice president, Joe Biden, reacting to the president's nuclear tweets against North Korea. You're going to hear his harsh words. That, and a lot more coming up.

(COMMERCIAL BREAK)

BLITZER: Breaking news. The president's former chief strategist, Steve Bannon, revealing new information about President Trump's efforts to woo Russian President Putin. In the upcoming book, "Fire and Fury: Inside the Trump White House," by Michael Wolff, recounts a conversation Bannon had with former FOX News executive, Roger Ailes, after the election. And it quotes Ailes as asking this, "What is he, Donald Trump, gotten himself into with the Russians." To which Bannon replies, quote, "Mostly he went to Russia and he thought he was going to meet Putin, but Putin couldn't give an expletive about him, so he's kept trying."

Joining us now, our national security analyst, Lisa Monaco. She formerly served as chief of staff to Robert Mueller back when he was head of the FBI, as well as a Homeland Security adviser to President Obama.

Lisa, thanks for coming in.

What's your reaction -- first of all, let's talk about North Korea right now, to the president's warning to Kim Jong-Un that his nuclear button is bigger and more powerful than the New Korean's nuclear button.

LISA MONACO, CNN NATIONAL SECURITY ANALYST: Wolf, it's hard to make sense of this. This is kind of tweet-from-the hip policy, if you can call it that. And we need to separate the message from the medium. The medium here being Twitter. It can be an appropriate way for a president to get his message out, as we saw in the case of the early tweet from the president about the Iranian protests and showing solidarity with the Iranian people against the regime there.

But the -- using Twitter in this way to kind of tweet from the hip about the size of his nuclear button, which is, of course, has been said elsewhere, there's not in fact a button on the deck. The button on the president's desk is used to summon the president's valet to offer guests something to drink. That's how it has been used in the past. But really what this is a kind of a shoot from the hip, and really a dangerous, a dangerous way of accepting a message and responding, frankly, to this ruthless dictator's taunting when it comes to nuclear weapons.

BLITZER: Just before he posted that tweet about the button, he posted this, "Sanctions and other pressures are beginning to have a big impact on North Korea. Soldiers are dangerously fleeing to South Korea. Rocket Man now wants to talk to South Korea for first time. Perhaps that is good news. Perhaps not. We will see."

MONACO: Look, what we see here is a real contrast between the South, looking for an overture, making an overture about talks on the North, making that overture, as well. We saw them reach out to the South Koreans to open up an old channel of communication and use it again.

(CROSSTALK)

BLITZER: Hasn't been used in two years.

[13:49:55] MONACO: Hasn't been used for a long time. That's a positive potential opening. The statement by the North that they may send a delegation to the Olympics. All of these things are potential openings that, if we were coordinating with our South Korean allies, could be used to help Secretary Mattis and Secretary Tillerson in their diplomatic efforts. They have both said diplomacy should be in the lead. And this is an opening that could be used towards that end. Instead, what we are seeing is incoherence coming out of the White House.

BLITZER: Kim Jong-Un's suggestion that he might send a team of athletes to South Korea to participate in the Winter Olympic games, got a very positive response from the South Korean leadership.

I want to listen to U.S. Ambassador to the U.N. Nikki Haley, who is not necessarily embracing this right now. Actually, let me read to you what she said: "North Korea can talk to whoever they want. But the U.S. is not going to recognize it or acknowledge it until they agree to ban the nuclear weapons that they have."

So what is your reaction when she says, you know what, they can talk as much as they want, we are not going to get involved with them until they ban their nuclear weapons?

MONACO: The question is how does that help the ultimate end, which is to support our ally in the South, protect the United States from increasing march that we are seeing from Kim Jong-Un to get a capability that could deliver a nuclear weapon one to the United States. What we need to see is coherent policy from the United States. And we have Secretary Tillerson on one page saying diplomacy should be the way and there shouldn't be preconditions to talks.

We see the White House in the form of the president under cutting that at every turn. Secretary Mattis making statements about how there ought to be strong nuclear military deterrence, which there ought to be, but there ought to be diplomacy in the lead. And you have this very high bar from Nikki Haley, which doesn't seem to advance with our South Korean allies in an effort to come to the diplomatic table.

BLITZER: The former vice president, Joe Biden, a man you worked with in the Obama White House, he was just on Capitol Hill for the swearing in of the new Senator from Alabama, Doug Jones. He was asked about President Trump's tweets on North Korea and he told CNN, "As far as the president's tweets are concerned, this is really poor judgment. We warned the president that words matter. Quote, "The only war that is worse than one that's intended is one that is not intended."

Strong words from Joe Biden.

MONACO: Strong words. And words of experience from Vice President Biden, who knows what he's talking about when it comes to foreign policy, and when it comes to this escalation of a cycle we are seeing President Trump engage in, in responding to the tweets from Kim Jong- Un.

BLITZER: Lisa Monaco, thanks for coming in.

MONACO: Thanks for having me.

BLITZER: Up next, the White House backs protesters in the Iran uprising, I'll speak live to an American journalist who was one of Iran's prisoner for 545 days. You'll hear his reaction to what's happening on the streets of Tehran and elsewhere right now.

Plus, explosive new criticism from one of the president's former close advisers. Why is Steve Bannon calling that infamous Trump Tower meeting with Donald Trump Jr and other campaign officials as well as with the Russians treasonous? And now the president is firing right back.

(COMMERCIAL BREAK)

[13:55:07] BLITZER: Demonstrators took to the streets in Iran once again today but, this time, the protests were in support of the Iranian government. Thousands of pro-government demonstrators held rallies in cities across the country. Some chanted "Death to America" after Iranian officials blamed the U.S. for stirring up the anti- government protests we have seen over the past few days. Those demonstrators that began a week or so ago are the most powerful challenge to the Iranian regime since 2009, the so-called Green Revolution at the time.

Jason Rezaian is a "Washington Post" staff writer, the newspaper's former Tehran bureau chief. He was imprisoned in Iran for 545 days.

Jason, thanks for joining us.

I know you monitor what goes on in Iran very closely. You speak Farsi. You monitor social media over there. What's your analysis? What is going on?

JASON REZAIAN, STAFF WRITER, WASHINGTON POST & FORMERLY IMPRISONED IN IRAN: Well, I think, Wolf, what started here was an uprising against high prices and economic concerns among working class folks that's -- I don't want to say spiraled out of control -- but has become more mass in terms of spreading across the country and addressing different concerns that people have with their leadership, concerns that they've had for years, but have found voice for in recent times.

BLITZER: Because we've had heard a lot of the protests from the anti- government, mostly young people out on the streets, protesting, "Where is the money." There's all these billions supposedly coming in as a result of the Iran nuclear deal. They don't feel the result themselves. They think the money is going, whether to Hezbollah or Syrian regime or to Iraqis, they want the money in Iraq.

REZAIAN: Well, and they were promised that. And I think that was probably a difficult promise to fulfill and continues to be so. There are signs that the Iranian economy is strengthening, is growing, but as you say it's not trickling down to normal folks. And they've had several years since the sanctions really started hitting, in 2012, of stuff time tough times and tougher times.

BLITZER: A lot of those sanctions have been eased as a result of the Iran nuclear deal, and billions of dollars supposedly has been coming in. But they are accusing of regime of spending a lot of that money, whether in Yemen or elsewhere.

REZAIAN: Syria as well.

BLITZER: Syria.

REZAIAN: And that doesn't sit well with the average Iranian person that continues to struggle on a daily basis.

BLITZER: Social media is playing a very significant role in this. Smart phones weren't very prevalent back in 2009. Maybe a thousand, whatever, if that. I mean, a million, if that. But now there are 50 or 60 million.

REZAIAN: Yes, almost everybody is online in some shape or form. I connect with people in Iran even now as the Internet has been really suppressed and slowed down through Twitter messaging, through Instagram, through all of these different channels that have supposedly been stopped because they have become a part of everyday life for most Iranians.

BLITZER: The president tweeted this earlier today. "Such respect for the people of Iran as they try to take back their corrupt government. You will see great support from the United States at the appropriate time." A lot of people -- you were there in Iran. A lot of people have

differentiated the very vocal response coming from President Trump as compared to the relative silence coming from President Obama back in 2009.

REZAIAN: I think it's always good to support in word the democratic aspirations of people anywhere in the world. But I think the people in Iran are having a hard time seeing how President Trump might be able to help them in this particular situation, especially since he's taking tough line on the Iranian people as well in terms of immigration and other things as well.

BLITZER: U.S. Ambassador Nikki Haley, to the United Nations, U.S. ambassador, said this, and I'll play the clip. Listen.

(BEGIN VIDEO CLIP)

NIKKI HALEY, U.S. AMBASSADOR TO THE UNITED NATIONS: By the thousands, Iranian citizens are taken to the streets to protest the oppression of their own government. We must not be silent. The people of Iran are crying out for freedom. All freedom-loving people must stand with their cause.

(END VIDEO CLIP)

BLITZER: Iran's U.N. mission responded to Ambassador Nikki Haley comments, calling it "nauseous crocodile tears." How is it playing out on the streets with the young people in Iran?

REZAIAN: Frankly, Wolf, I think the young people in Iran that are protesting right now find the words of power, whether in Washington or Tehran, to be hollow. And this is one more situation where they feel like they are not being heard and not being given a fair shake, and they just really want their daily concerns addressed more effectively by anyone.

BLITZER: Jason Rezaian, of the "Washington Post," thanks very much for coming in. Always good to speak with you.

REZAIAN: Thank you. It's a pleasure.

BLITZER: Appreciate it very much.

That's it for me. I'll be back 5:00 p.m. Eastern in "THE SITUATION ROOM."

In the meantime, the news continues, and there is lots of it right now. The news continues here on CNN.