Return to Transcripts main page


Trump: I Would Shut Down Government If Immigration Deals Fails; Kelly: Some Immigrants "Too Lazy To Get Off Their Assess"; W.H. Says "We Are Not Advocating" For A Shutdown After Trump Says He'd Love To See A Shutdown; Trump Meets With Embattled Deputy A.G. Amid Memo Controversy; Interview with Chairman Kevin Hassett of Council of Economic Advisers; White House: Trump Was "Joking" When He Accused Dems of Treason. Aired 7-8p ET

Aired February 6, 2018 - 19:00   ET



WOLF BLITZER, CNN ANCHOR: Barbara Starr, thank you. That's it for me. "Erin Burnett "OutFront"" starts right now.

ERIN BURNETT, CNN ANCHOR: "OutFront" next breaking news, the President says love a shutdown. Now, even his own party crying foul.

Plus more breaking news, Trump met moments ago with Rod Rosenstein, yes, and what happened in that meeting? And the President wants an American military parade, a history making first. Is this the U.S. or North Korea? Let's go "OutFront".

And good evening, I'm Erin Burnett. "OutFront" tonight, the shutdown roulette. President Trump is playing games with another government shutdown declaring today he would love to see the Federal government shutdown again and he could get his wish in just 48 hours. That is how much time is left before -- if there is no immigration deal, shutdown.

The President's bet is that Americans will blame Democrats for not agreeing to tighter immigration laws. Here is President Trump saying something that caught even Republicans in the room today by surprise.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I'd love to see a shutdown if we don't get this stuff taken care of. And if we have to shut it down because Democrats don't want safety and unrelated but still related, they don't want to take care of our military, then shut it down. We'll go with another shutdown.


BURNETT: Well, he might have wanted to say "I," because the use of royal "we" in this case seem to be a bit misplaced. Even Congresswoman Barbara Comstock of Virginia, who is in a tight race for reelection, could not stomach the thought of another shutdown.

(BEGIN VIDEO CLIP) REP. BARBARA COMSTOCK (R), VIRGINIA: We don't need a government shutdown on this. We really do know -- I think both sides has learned that a government shutdown was bad. It wasn't good for them. And we do have bipartisan support on these things.

TRUMP: We're not getting support from the Democrats on this legislation.


BURNETT: She says bipartisan support. He says no. She says no shutdown. The President says we want a shutdown. Well, here's the thing, again on this issue of "we," Comstock is not alone, she has a we. New York Republican Pete King, supporter of the President, also said no to a shutdown.


REP. PETE KING (D), NEW YORK: As I understand what he's saying is to come down to it and he's talking about saving lives against M.S. 13, shutdown, yes, but I don't see that at all in the offering.


BURNETT: Doesn't see it in the offering. Well, senior GOP force, source calls the President's words today a bluff saying Trump's threat is, "Trump being Trump. I doubt we see a shutdown."

As the President played games though with a shutdown, which again is just hours away, guys, we are right down to the line, his chief of staff, John Kelly, threw a verbal grenade into the whole conversation of an immigration deal. Kelly said Trump's immigration plan that's on the table here to figure out in the next 48 hours would provide a path to citizenship of the 1.8 million Dreamers, and that is when things got ugly.


JOHN KELLY, WHITE HOUSE CHIEF OF STAFF: There are 690,000 official DACA registrants and the President sent over what amounts to be 2.5 times that number to 1.8 million. The difference between 690 and 1.8 million were the people that some would say were too afraid to sign up, others would say were too lazy to get off their asses, but they didn't sign up.


BURNETT: OK. The White House Press Secretary was asked to explain Kelly's comments calling 1.1 million immigrants lazy and here is Sarah Sanders.


SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: We're focused on actually getting a solution. And, frankly, I think if anybody is lazy, it's probably Democrats who aren't showing up to work and are actually getting to the table to make a deal on this.


BURNETT: OK. So the U.S. government is facing another shutdown in two days. The President of the United States says bring it on. His chief of staff came out and called 1.1 million people who came to this country as children lazy. His press secretary decided to blame Democrats for all of it.

Just remember the context, you know, the last government shutdown was only 17 days ago and it happened because of brinkmanship and grenades like this. This is no game.

Pamela Brown "OutFront" tonight at the White House to begin our coverage. And Pamela, just moments ago it sounded like the chief of staff, John Kelly, doubled down on his lazy comments.

PAMELA BROWN, CNN SENIOR WHITE HOUSE CORRESPONDENT: That's right, Erin. Speaking to my colleague, (INAUDIBLE), he did seem to double down saying some DACA eligible who didn't sign up had reasons. But he went on to say, but most probably needed to get off the couch."

This is in the wake of his comments earlier today that caused quite a stir when he said some of those DACA eligible people who didn't register the gap between 690,000 and 1.8 million were either too afraid or too lazy to get off their asses.

Now, Sarah Sanders was asked about those comments today about the Dreamers, those young people brought to the U.S. through no fault of their own. And she was asked if those comments were offensive. She left it up to the individual to decide that and put the blame as you saw there directly on the Democrats. But it's clear that General Kelly's comments today are an attempt to play to the base, those with the hard line stance on immigration.

[19:05:06] As this was happening, Erin, the President threw quite a curveball today when he basically said he would love a shutdown, another government shutdown if there is no fix on immigration. These comments coming as Democrats and Republicans on Capitol Hill are scrambling to avert another shutdown on Thursday.

Sarah Sanders, the press secretary, had to play a little bit of cleanup there, too, today saying that the White House is not advocating for a shutdown that the President actually wants a long- term deal and a long-term deal on immigration. So it seems as though she had to cleanup a couple of comments here at the White House today, Erin.

BURNETT: All right. Thank you very much, Pamela.

And "OutFront" now, Nia-Malika Henderson, our Senior Political Reporter, Tim Naftali, former Director of the Nixon Presidential Library, and April Ryan, White House Correspondent for American Urban Radio Networks. OK, thanks to all.

Tim, as Pamela said, they were trying to do a lot of cleanup. Let's start here with just the issue of we want to shut -- "Bring it on. I'd love a good shutdown," from the President. By the way, consistent with what he said last spring on Twitter, you know, I mean, these are the kinds of things he said -- he has said before. But obviously Republicans do not want any parts of that.

TIM NAFTALI, FORMER DIRECTOR, NIXON PRESIDENTIAL LIBRARY: No. And the real issue here is whether the President wants to make a deal. You know, the issue right now is this. You have a larger number of Dreamers who would benefit from a path to citizenship. You'd have, what, I don't, $30 billion that would go to building a wall. By the way, you know we have portions of a wall already that started.

BURNETT: Well, significant portions of a wall.

NAFTALI: Yes. You know, let's not -- the American people should know that President George W. Bush and Barack Obama built wall like structures --


NAFTALI: -- along the portions of the real ground and elsewhere. OK, the third part is the tough one, reducing legal immigration. And that's a poison pill. And the President doesn't seem willing to give on that because, you know, we almost forget about that.

I think the first two elements, I think the Democrats could deal on that. But the third element, reducing legal immigration, is really tough. And it's not clear that the President wants to do a deal there.


NAFTALI: So if he's standing there saying, "I want a deal," but he doesn't want to really do a deal, whose fault would it be if we had a shutdown? His.

BURNETT: Look, Nia, here's the question. You know, you have Sarah Sanders trying to defend the President and Kelly. Before -- by the way, Kelly just came out and said lazy in another way, right, they're lazy get off the couch to go register. So Kelly is making it clear, "I don't want anyone apologizing for me."

But here's Sarah Sanders trying to basically say, "Don't blame Kelly, don't blame the President, blame Democrats."


SANDERS: We are not advocating for the shutdown. That's the fault of the Democrats not being willing to do their jobs. We're focused on actually getting a solution. And frankly, I think if anybody is lazy it's probably Democrats who aren't showing up to work and aren't actually getting to the table to make a deal on this.


BURNETT: Nia, you know, you just heard Barbara Comstock, Republican, saying, "Look, we have a bipartisan deal here." We agree, Democrats and Republicans.


BURNETT: It's the President who is saying, "I'd love a shutdown."

HENDERSON: Yes. I think that's right. And there's the feeling on the Hill that they are close to figuring this out that nobody wants a shutdown. It didn't go well for either party last around. So here is the President not being helpful at all being he is sort of unpredictable, or predictably unpredictable self in these negotiations.

And like you said, echoing what he said before in terms of wanting a good shutdown. You have on the Hill, Democrats and Republicans, essentially saying they want to separate the immigration debate from the government funding debate and the clock is obviously ticking.


HENDERSON: And then Thursday the government shuts down. You know, I think in terms of what Tim is talking about and in terms of what Democrats are willing to agree to, I do think Democrats are willing to agree to any number of things. The real problem of it that White House has is House Republicans.

House Republicans aren't too keen on extending a citizenship and all of the rights of American citizens to folks who have come here illegally. And it certainly doesn't help when the President demonizes people who have come here illegally and talks about them essentially as committing crimes. And then Kelly, of course, saying that many of them are lazy.

BURNETT: Right. So, April, that's the big question, right, how this is all going to play, because as Pamela is reporting, John Kelly just said, you know, that they don't want to get off the couch, so he double downed on the comments.


BURNETT: But I just want to play again what he said about illegal immigrants who were eligible for DACA but have not signed up. Here's how he put it when it was on tape.



KELLY: The difference between 690 and 1.8 million were the people that some would say were too afraid to sign up, others would say were too lazy to get off their asses but they didn't sign up.


BURNETT: So, April, Sarah Sanders was asked this, whether this was offensive by our Jim Acosta. Here's that exchange. I know you were in the room. Here it is. RYAN: Yes.


JIM ACOSTA, CNN SENIOR WHITE CORRESPONDENT: Isn't it just an offensive comment though, isn't it just on the surface?

SANDERS: I think that's something you would have to decide for yourself.


[19:10:03] BURNETT: So 1.1 million either lazy immigrants or people too afraid to sign up. "Decide for yourself," that is what she said, April.

RYAN: Well, it doesn't play well. And when we heard about this comment, you know, many of us -- that was an impacting statement, something that you typically don't hear from Politicos or even people who work in White House. But this is a very different White House.

That goes back to what we heard a few weeks ago when people were talking about, "Can we actually work in good faith with the President allegedly saying assholes?" And this is kind of along that same line. It is a stereotype. It could be perceived as racially biased. I mean, it's just -- it's ugly, but at the same time, you know, this is a White House that is willing to shut things down as they are saying these very inflammatory words if they don't get a deal on immigration. So the devil is in the details.

Let's see, as Nia said, the predictability of their unpredictable behavior. So let's see how this works. I just question, can these lawmaker work in good faith? Particularly the Democrats who say they are very concerned about hearing these lazy a words and asshole comments and it goes right back to where we were a couple of weeks ago. And it begs the question, will they be kicking the can down the road again, because the issue of working in good faith from the White House. That's just the big issue.

BURNETT: And, Tim, to the point April's making, Democrat Senator Bob Menendez, who is back (ph), tweeted a response to Kelly's comments, raising this sh house link. "From sh houses to lazy asses, the White House seems to be only concern with degrading the very people they claim to want to save. Shame on those who insist on demonizing hard working immigrants for political purpose. Is this the way Kelly's comments about 1.1 million immigrants is going to play? It is quite of racially tinged.

NAFTALI: Just because General Kelly can get the trains to sort of run on time in the White House, doesn't mean that he softens some of the extreme views that President Trump has about immigration. He may actually magnify them. We don't know the way in which these two interact.

For example, by Bob Haldeman, chief of staff to Nixon, he was an anti- semi too. So when the two of them got together, they just -- they ratchet it up their anti-Semitism. We don't know if Kelly is actually working with the President to get a deal on DACA who's one of those -- who is also like a House Republican suspicious of allowing people who came here illegally to become U.S. citizens.

BURNETT: Nia, it's like they are swirling together on this.

HENDERSON: Well, I think that's right. I mean, they are echoing each other. I mean, Kelly's rhetoric might not be as harsh, but it certainly plays into a stereotype, this idea of a lazy Latinos.

I mean, I think until we see the President make an affirmative case and a positive case for DACA recipients to stay in this country legally, say that they are part of the military, say that they are part of communities throughout the country, I mean, I think it's unlikely that he is going to change House Republicans minds.

BURNETT: All right. Thank you all very much. You know, for those who try to defend the whole sh house thing by saying, "Oh, it is the governments in those countries." Well, when you're now saying the people came from this country to this country who are also lazy, it's not that.

"OutFront" next breaking news, the President meets with Rod Rosenstein over the Democrats answered to the Nunes memo. So will we see it? Plus, Trump wants a big military parade, that news just breaking. And the Pentagon is now busy planning it trying to get him a date. Is this a move like Kim Jong-un or Vladimir Putin?

And women and chips, can you believe that the female CEO of Pepsi, which owns Doritos, you know, this whole lady Doritos idea is real?


[19:17:33] BURNETT: Breaking news, President Trump meeting with the Deputy Attorney General Rod Rosenstein. The topic, the Democrat rebuttal to the Nunes memo. Let's call it the Schiff memo, because he is the one who wrote it for the Democrats.

CNN learning that the meeting between the President and Rod Rosenstein, you see their faces there, was 10 minutes to 15 minutes, that's pretty short. But according to the White House, the two discussed the differences between the Republican and Democrat memos. The White House insisting that the Democrats memo is under going, "the exact same process" that Republican memo went through.

In fact, Chief of Staff John Kelly just telling reporters that he expects to have a recommendation on whether to release the memo by Thursday, that of course is longer than it took the President to say such for the Republican memo. But he says they're relying on the FBI for the Dems memo and whether anything needs to be redacted.

The White House, of course, got the Republican memo last Monday, 24 hours later the President had this to say about it. He didn't take any time to say this.


TRUMP: Don't worry, 100 percent. Can you imagine?


BURNETT: Well, we haven't heard anything like that this time and more time has passed. The White House has had the Democrats memo for the same amount of time. The President has not come out saying anything about releasing the memo.

Manu Raju is "OutFront". And Manu, what are Republican saying about the memo tonight?

MANU RAJU, CNN SENIOR CONGRESSIONAL REPORTER: Well, they are waiting for what the White House is going to do. And if the White House did move forward with any redactions, Erin, it's not clear whether they'll get any resistance from Republicans on the Hill or if the President went so far is to block the release of the Schiff memo.

A number of Republicans just are saying -- are not saying that they would vote to override the President, which was what they would have to do to release the Schiff memo. Now that position much different than the position they took over the Nunes memo last week when a member of them regressively lobbying the White House to release that Schiff memo -- that Nunes memo.

Now, the Nunes memo is roughly 3.5 pages in length versus the Schiff memo about 10 pages. They both offer kind of different points about exactly how that warrant to surveil Carter Page was obtain during the campaign season of 2016. The Nunes memo, i.e., it was done improperly. The Schiff memo saying it was done according to the proper procedures.

Now, in a sign of what John Kelly -- that the White House may be seeking to redact with some things in the Schiff memo what John Kelly said just now was significant, Erin, said for the first cut, the first look of this, it's not as clean as Nunes memo.

[19:20:02] So this is a sign that the White House may be taking steps to try to at least limit what the public could view on this if they have concerns about some of the language in there. We'll see what they decide to do by Thursday of this week, Erin.

BURNETT: All right, thank you very much. Appreciate it, Manu.

"OutFront" now, Democrat Congressman Jerry Nadler of New York, Ranking Member of the House Judiciary Committee, seen both memos and -- of the underlying intelligence behind them as well. So Congressman, good to have you back.


BURNETT: You just heard of -- the Chief of Staff John Kelly says the Democrat memo, 10 pages, is not as clean as the Republican memo. And you heard Manu saying that could be really an opening sally to trying to limit what in the Schiff memo, the 10-page Democratic memo, becomes public. Do you think we'll see the whole memo or not?

NADLER: Well, I don't know. I certainly hope we will, because any attempt to eliminate parts of that memo will be seen and probably so as an attempt to sensor it and to shield the Nunes memo from the criticism that it offers.

BURNETT: Is there anything in it? It is 10 pages as opposed to three and a quarter or three and a third, to be exact, that the Nunes memo was. Is there anything in there that should be redacted for security purposes?

NADLER: Well, I don't know. I'm not a security expert. But the FBI --

BURNETT: But you read it. What is your gut? You read the underlying --

NADLER: No, no. I'm not going to say that. I have read it. I think it's a good memo. I think it makes points. Whether anything in there would give up ways that I can't tell sources and methods, I can't say.

BURNETT: All right, but nothing obvious to you is what you are saying.

NADLER: Nothing obvious at all.

BURNETT: OK. You already released, actually, 6-page rebuttal to the Nunes memo. And in that rebuttal, Congressman, you write, "The Nunes memo shows that House Republicans are now part and parcel to an organized effort to obstruct the Special Counsel's objection." So Manu asked Paul Ryan, the speaker, about that allegation today. And here's what he said.


RAJU: You made the case of the memo -- the Nunes memo was separate from the Mueller investigation.

REP. PAUL RYAN (R), SPEAKER OF THE HOUSE: I continue to say that.


BURNETT: Do you believe the Speaker?

NADLER: No, I do not believe the Speaker. He may believe that. But certainly the Nunes memo was written for the purpose of trashing the FBI and the Department of Justice and interfering with the investigation by Mueller and preparing the way to -- for people not to believe anything that Mueller may come up with. It was an attempt to discredit the Mueller investigation and that was obviously his main purpose.

BURNETT: Now the Speaker was then asked whether the Nunes memo vindicated the President as the President had explicitly said, okay. And I wanted to play that exchange because it is pretty important. Here's the Speaker and Manu. (BEGIN VIDEO CLIP)

RAJU: But yet over the weekend the President claimed total vindication from the Nunes memo. Was he vindicated in any way?

RYAN: Let me go back to what I just said. This is about FISA abuse and this is about holding our government accountable, and this is about Congress doing its job in conducting over the executive branch, which in this particular case has been given great power over as a citizens. We need to make sure that that power is used correctly.

RAJU: But was the President vindicated?

RYAN: Thank you.


BURNETT: OK. Obviously he wouldn't answer the question, Congressman. But if Paul Ryan says the Nunes memo is separate from the Mueller investigation then definitionally, he must say the President has not been vindicated because of the memo, right, in the Russian investigation. That would be a definitional answer. He is not giving it. Your reaction.

NADLER: Well, he's correct. The Nunes memo, although being portrayed as vindicating the President and as saying that the investigation is not on the up and up because it was borne in sin in that FISA application, in fact, shows nothing of the sort, has nothing to do with the President and his guilt or lack of it in colluding with Russian --


BURNETT: Right. But Paul Ryan won't say that. He is not making that step and step. He is refusing to say the President has not been vindicated.

NADLER: No, I agree with him. I agree with him. The President is saying he's been vindicated. And the fact is that memo has nothing to do with the conduct of the President one way or the other. All it does is try to discredit the investigation, which is ongoing, to decide that point.

BURNETT: Right. I guess I'm missing something. You know, Trey Gowdy has said the President has not been vindicated because of the memo. Will Hurd had said that. Other Republicans have said that. I'm just making the point. Paul Ryan will not say that. He will not answer one way or the other, whether the memo vindicated the President or not. And my question to you is does that disappoint you from Paul Ryan?

NADLER: Well, it does disappoint me because he's not being completely forth coming. But he does disagree with the President. He's not saying that it does vindicate the President. But anybody who reads it knows it has nothing to do with vindicating the President. It doesn't say anything to the President's involvement or the Trump campaign's involvement in colluding with the Russians or in covering it up or in obstructing justice at all, which is -- it doesn't say anything about it.

BURNETT: All right. Well, Congressman, appreciate your time as always. Thank you, sir.

NADLER: Thank you.

BURNETT: And next, another day of whiplash for the stock market and a huge finish. Trump's chief economist adviser on this is next.

[19:25:06] And the Trump for president campaign just launched a new ad calling out Democrats for not applauding at the State of the Union.


BURNETT: Tonight, another more than 1,000 point swing on Wall Street. After suffering the biggest point loss ever yesterday, the Dow today rows 567 points, that's a big surge. (INAUDIBLE) lows it was down more than 500, so that is more than 1,000 points of whiplash. But the President in unusual and characteristic move has not bragged about today's surge.

"OutFront" now, Kevin Hassett, Chairman of the White House Council of economic advisers. And thank you very much for being back with me, Chairman. I appreciate your time.


BURNETT: The Dow obviously today up more than 560 points after that more than 1,100 point plunge yesterday. Are you feeling better?

HASSETT: Well, I think that, you know, our job at the CEA, especially is to focus on the long-term fundamentals of the economy. Those are very, very strong. I don't think that there is anybody that can successfully predict the ups and downs of the market. But, you know, we've been monitoring the situation closely.

We, Gary Cohn and Secretary Mnuchin and I have been in constant contact with financial regulators. And, you know, I guess sure, today's movement was good news for investors. But, again, the fundamentals are strong. And right now the White House, you know, looking ahead. We're focus GDP growth, wage group, you know, the economic fundamentals which are about as strong as we have seen in more than a decade.

BURNETT: I want to talk about this, but first, part of the reason this is such a big story, of course, is that the President cares deeply about the stock market. He talks about it all the time. You know, I've talked to someone who speaks to him frequently. He said, I have told him not to talk about the stock market and to brag about it, to talk about the underlying economy. Obviously the President has chosen not to do that.

According to "The New York Times," in fact, he bragged about the stock market's gain 25 times, Chairman, in January alone. Here are just a few.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I don't know if you've heard the latest but the market is up about 150 points.

The stock market is up very, very big today.

The stock market is hitting one all time record after another.

We're just hitting a new high on the stock market again.

When you look on what's going on with the stock market, we've created now almost $8 trillion worth of value.

Pensions and retirement accounts are surging in value as the stock market smashes one record high after another.

You look at the stock market at all-time high.

You're seeing what's happening with the stock market. People are appreciating what we are doing.

The stock market has smashed one record after another.


BURNETT: I couldn't even play all 25 because I didn't want to waste more of anyone's time listening to it. But the point needed to be made. He hasn't said anything about the market plunge or even today. Have you advised him, Chairman, to stop -- to stop talking and bragging about a day-to-day rise in the market?

KEVIN HASSETT, CHAIRMAN, WHITE HOUSE COUNCIL OF ECONOMIC ADVISERS: No, you know, I would never advise the president, you know, what he should have talked about. I mean, we can certainly go into the substance of what's going on with this or that indicator. But in fact, you know, markets are forward looking. The value of firm is present value of earnings. And they swing up and down of course.


HASSETT: But if the market moves up a lot, then that's a positive forward looking indicator and I know it's one that you've been talking about for many years. So, I think the president is right to say, hey, you know, the most forward indicator we have is equity markets. If you take the difference between today's close and the day he was elected, it's up, what, about 25 percent, and that means that people are optimistic about what President Trump is going to do with the economy. So, I think he's right to point to it.

BURNETT: You think he's right to point to the market.

HASSETT: I -- yes, yes.

BURNETT: Because what I'm wondering, because you are his chief economic adviser and I know that means you think about the committee. But you are chief economic adviser. If any one is going to be in position to tell him, look, you need to tone it down, you don't want to be marked by day-to-day mark in the stock market, it would be you, wouldn't it?

HASSETT: You are correct, Erin, you shouldn't be like -- you know, the market is going to go up, the market is going to go down, when we hit a peak, it's likely to come off that peak. And so, day-to-day fluctuations are out there.

But I think that the fundamental, underlying trend that the president is talking about is sound one to point to, the fact that it's up so much is not, you know, a mystery, it's because President Trump's policies have started to become law. They're having a big effect on small business confidence, on business confidence, on investment, on wages, every indicator that we have is moving in the right direction and equity markets have reflected that.

BURNETT: Part of the issue here is the president's tax plan. Wages are growing as you point out. On top of it, you all have added a tax cut for some Americans. That is a lot of money entering the system. It is causing inflation fears that in part have spooked the market.

Now, traditional policy, of course, would say don't give a tax cut when wages are already rising, you save that fuel when things slow down, so you can give people a little bit of a fill up when they need it. Is the Trump administration adding fuel to the fire at exactly the wrong time?

HASSETT: It's a terrific question, Erin. And the answer is no. But again, I think that it's interesting to go back to last week. And the best news we got last week was that wage growth in the employment report was up 2.9 percent year-over-year which is the highest rate we have seen in about a decade. And so, that was really good wage news and it was one of the things that got people to wondering, you know, geez, is inflation getting out of control.


HASSETT: But the fact is that this tax cut is supply side tax cut. It's causing a boom in capital spending. And as people who have done introductory economics know that when have you a supply side tax cut, when you have a stimulus to the supply side, it puts pressure downward prices because so got more supply. So, people -- firms have more supply to have to cut prices in order to sell their stuff. So, we think that the wage data that we are seeing --

BURNETT: Right, unless they are raising wages, as you said they would because it was some of their money, in which case that would cause an upward --

HASSETT: Well, no, but if wages are going -- if wages are going up, because productivity is going up then it doesn't put upward pressure on pressure. I mean, you know that, and so we think --

BURNETT: Wait, are you admitting that wages are going up because of productivity and not because companies are going to actually give people a wage increase because of the tax cuts, they're not going to use the tax cut for wages?

HASSETT: No, remember, we talked this on the show before, right? There is a link. The tax cut causes capital formation. The capital formation increases productivity and that goes through wages. I think the surprise 2for me since we last talked about this is that the wage increases have come so fast.

BURNETT: Now, on the tax cut, though, obviously, the tax cut is estimate to add a trillion and a half dollars to the deficit, at least. Some say more, right? But the numbers over all are $1.5 trillion. The Treasury Department itself chairman says the federal government is going to borrow $1 trillion this year. That is 84 percent higher than the last year President Obama was in the office. It's the highest level of borrowing in six years.

I just wanted to put this in context. Not only is debt something that Republicans have traditionally been extremely concerned about.

[19:35:04] It's something the president of the United States slammed President Obama for running up. Here he is with Sean Hannity.


TRUMP: The country, we took it over, it owed $20 trillion. As you know, the last eight years, they borrowed more than it did in the whole history of our country.


BURNETT: So, he is upset about it there. That was October of 2017. And now, here he is adding more to it. How does that add up?

HASSETT: Well, you know, I think the president has set the priorities correctly. And the first priority last year was to fix our uncompetitive tax system so that we could go back to growing at 3 percent again. And here we are, growing at 3 percent or higher again.

And I think what that does is starts to give us the resources we need to address our longer run problems. The president absolutely cares a lot about the deficit. I think that the whole economic team looks ahead over the next few decades and sees deficit that's not necessarily sustainable. And that's absolutely correct.

But it's going to be easier to address those problems if we fix the big gaping wound that we had which was the tax bill.


BURNETT: Right. But even in doing that, you all are admitting you're borrowing a trillion and a half to do it?


BURNETT: It doesn't seem like there is any religion to use the term about debt whatsoever from your administration.

HASSETT: Well, in present value, we've got to payoff our debts and we've got to raise the money to do that. I don't think anyone disputes that. But if we start out with noncompetitive tax code that's creating jobs over there but not over here, and giving us, you know, anemic 1 percent growth, then that doesn't give us the resources we need to address our bigger problems.

If we grow at 3 percent, you would agree, Erin, over the next decade, then that's an extra, you know, 1 percent of a year relative to what President Obama's baseline was and that's 10 percent more GDP. That's $2 trillion. If he got that extra $2 trillion, then, you know, we could do some -- use some of that to address the debt problem.

So, it's both sides really. We have to grow the economy more. And then once we've got those resources, we have to think about how we're going to address these longer run problems.

BURNETT: All right. Well, I appreciate your time, Chairman Hassett.

HASSETT: Thank you. It's great to be here.

BURNETT: Look forward to having you on again as always. Thank you.

HASSETT: Yes, thank you.

BURNETT: And OUTFRONT next, the White House doubling down on Trump's treason claims about Democrats, using insults in new campaign ad as they try to say on the other side of their mouth that it was all a joke.


SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: The president was clearly joking with his comments.


BURNETT: And Trump using a tragedy to make the case for tougher immigration, this time the death of a NFL on the hands of an undocumented immigrant.


[19:41:11] BURNETT: Tonight's strong words from President Trump's own party after the White House claims the president was just joking when he called Democrats treasonous because they didn't stand and clap for him during his State of the Union Address.


SEN. JEFF FLAKE (R), ARIZONA: Just sarcasm. Only tongue and check. But treason is not a punch line, Mr. President.


BURNETT: The White House though is not giving an inch.


SANDERS: I don't really care what Senator Flake has to say. I don't think his constituents do either. And I think that's why his numbers were in the tank. The president was clearly joking with his comments.


BURNETT: Tonight, even the president using these images of Pelosi, Schumer and Sanders looking angry while the president is talking about how great the country is doing in a campaign ad. See, using the whole clapping and applauding thing and they sat there while these things were said.

So, is it a joke or is it something for campaign ad?

OUTFRONT now, national affairs correspondent for "The Nation", Joan Walsh, and communications director for President Trump's transition team, Brian Lanza.

Let me just remind our viewers again what it is that the president said all in that caused all of this.


TRUMP: They were like death and un-American. Un-American. Somebody said treasonous. I mean, yes, I guess why not?


BURNETT: So, now, they are using campaign ad but saying clearly it is a joke.

JOAN WALSH, NATIONAL AFFAIRS CORRESPONDENT, THE NATION: No, it's not a joke. It's what they are doing now is a joke. It was obviously not a joke.

And Sarah Sanders today in denying it and saying it was a joke, nonetheless, again, called Democrats un-American. And I need to remind our viewers protest, not applauding the president very American, very patriotic and American tradition.

So, this notion that not applauding for Donald Trump after what the Republicans did to Barack Obama, let's not get into that, is somehow un-American, treasonous, not patriotic, they don't love their country. And that too is calling for a military parade, we're seeing something very authoritarian. This is the beginning -- this is not the beginning. This is authoritarianism.

BURNETT: So, I want to talk about the parade in a just a moment.

Brian, though, this whole issue about joking, right? First of all, the president was serious when he said un-American, right? Then he followed up with the treasonous comment which, of course, has gotten so much backlash from people on both sides of the aisle. But this whole joking thing, you've been there in a transition team. You might have been some who's used to this before, to try to clean up for something the president said.

Here are a few examples.


TRUMP: So, you don't think I was joking. You know I was joking. Of course I was joking.

I obviously was being sarcastic. In fact, the people in the room were laughing.

SEAN SPICER, FORMER WHITE HOUSE PRESS SECRETARY: He meant as a lighthearted moment, and I think if you look at the totality of his remarks, they were absolutely beautiful.

SANDERS: He was simply making a comment, making a joke, and it was nothing more than that.


BURNETT: Is the excuse a little tired, Brian?

BRYAN LANZA, FORMER COMMUNICATIONS DIRECTOR, TRUMP TRANSITION TEAM: I guess we're going to be adding this clip to those previous clips.

I think people need to lighten up. He was joking. He has this type of sense of humor. This has been his personality before he's ever run for president. He sort of does that extra jab that some people take too far but some people laugh at it, and his intent was to have a good laugh about it and people need to lighten up.

Like, you can always microanalyze something but -- and find the wrong in it, but I think, you know, the over all people saw he was laughing, and there's a campaign rally sort of take it as humor.

BURNETT: So let's talk about this authoritarian point that you were making, Joan. The president is now asking, has expressed desire for military style parade.


BURNETT: And the Pentagon is looking into it and getting back to him with some dates is the reporting that we have.


BURNETT: You know, look, you have, of course, the North Korean parallels, big military parades and standing and applauding.

[19:45:00] Is it fair to make that analogy?

WALSH: I think it's very fair. This is not something we do. We also know the president actually wanted there to be tanks and other military equipment during his inaugural parade but was told that the streets of Washington wouldn't stand for it.

This is very -- you know, the thing about the word authoritarian, it sounds a little bit extreme, but you've got to look at the context of what this man has done from the beginning. He has said he wanted to lock up his opponent, Hillary Clinton. Then, he said, when he got elected, he didn't -- he wasn't going to lock her up. But in fact, that's also authoritarianism because it's not his decision. He doesn't get to decide who gets locked up. That's the Justice Department.

He constantly acts as though he is the final authority on rules of law. And he's not. That's un-American.

BURNETT: So, Brian, you know, the military parade, what do you make of that? I mean, he was actually with the French president, Macron, on Bastille Day last summer. And that he saw their parade and he thought that was one of the greatest parades in his words have ever seen.

Is French model OK, Brian? I mean, obviously, France is a -- well, actually, ironically a socialist democracy.

LANZA: You know, Erin, I'm going to be honest with you, I haven't read the article. I'm always suspicious when I see anonymous sources sort of saying these things, these anonymous whispers. So, without seeing the article and understanding the context of this, I really don't know what this topic is about. But I always would warn people, any time you read a story with anonymous sources --

BURNETT: Just to be clear, the Pentagon has confirmed they're looking at dates.

LANZA: Like I said, I haven't seen the article. So, I don't know the entire the context of this. So, I wasn't -- you know, told that this was going to be the topic and I didn't prepare for this.

So, but I would say, we always have to be cautious with anonymous sources. I think we've learned this past year that anonymous sources --

BURNETT: Right. But I said the Pentagon has confirmed it. That's why I'm saying it's not anonymous --

LANZA: I haven't -- and like I said, I haven't seen the story so I don't understand any part of this story line.

BURNETT: OK. What's your gut though on the president wanting a military style parade? Is it like the French model is that something that would indicate American pride and power? Or authoritarianism?

LANZA: Listen, I think what we need to do from our military there has been a public view of the degrading of our military over the years with the lack of spending, with a lot of these budget caps. And I think what the president wants to do is he wants -- and he knows that the international community has sort of seen and seen the weakening of our military or saw the defunding of our military. And the president wants to change that perception, like he's made previous statement he wants to build the military. So I think when he is looking for areas to highlight the fact that we are turning the thing around, we are investing in our military, again, we're investing in security, I think he's going to look at a lot of options. Is it going to be this? I don't know. Probably not, but I think you're going to see the president promote the strength and the building up of our military and is a complete reverse than we've seen in the last eight years.

BURNETT: All right. Thank you both very much.

Big change to the walk softly and carry a big stick. Walk with a big stick, clack it on aground, I don't know. Someone can come up with a better line with that.

All right. Next, Trump weighs in on sudden death of NFL player killed by someone who is in this country illegally.

And in a much lighter note, Doritos for her, my guess is these are going to be called macho cheese.


[19:51:51] BURNETT: New tonight, President Trump pointing to the death of an NFL player to slam Democrats on immigration. Indianapolis Colts linebacker Edwin Johnson was killed after being hit by a suspected drunk driver who police say was in the country illegally.

This prompting the president to tweet: So disgraceful that a person illegally on our country killed Colts linebacker Edwin Jackson. This is just one of many preventable tragedies. We must get to the Dems to get tough on the border and with illegal immigration fast.

Athena Jones is OUTFRONT.


ATHENA JONES, CNN CORRESPONDENT (voice-over): Police say 37-year-old Manuel Orrego-Savala, an undocumented immigrant from Guatemala, was drunk early Sunday morning when he drove onto the emergency shoulder of Interstate 70, striking and killing NFL linebacker Edwin Jackson and his Uber driver Jeffrey Monroe.

The pair had pulled over and were standing outside the vehicle. Police believe they had stopped because Jackson became ill and Monroe was attending to him.

SGT. JOHN PERRINE, INDIANA STATE POLICE: It appears that somebody got behind the wheel of a vehicle after having consumed alcohol and now we have tragic consequences that are going to affect many, many lives because of somebody's poor decision.

JONES: Immigration authority say Orrego-Savala, who was using an alias, first entered the U.S. illegally in 2004. He was convicted of drunk driving in California in 2005 and was arrested in Indiana in March 2017 for driving without a license. He had been deported twice in 2007 and in 2009.

Federal immigrations officials have placed a hold on Orrego-Savala, which means they can detain him if and when he's released from state custody. His undocumented status is why Jackson's death which was met with outpouring of grief for those who knew and loved him was also met with fury from President Trump, tweeting his morning: So disgraceful that a person illegally in our country killed Colt's linebacker Edwin Jackson. This is just one of many such preventable tragedies. We must get the Dems to get tough on the border and with illegal immigration fast.

That statement echoed an earlier tweet by Vice President Mike Pence, the former governor of Indiana.

It's a case tailor-made for the tough on illegal immigration argument the president and his allies are pushing.

TRUMP: We need better mechanisms and much better border security. We need the wall.

JONES: Allies like Todd Rokita, the GOP congressman who was hoping to unseat Democratic Senator Joe Donnelly. Rokita tweeted about the incident, saying: This news should make all Americans angry. We must do more to get these dangerous illegal immigrant criminals off our streets build a wall and put an end to illegal immigration.


2JONES: Now, Orrego-Savala is scheduled to appear in court tomorrow morning to hear the charges against him. Now, those charges are being finalized as of earlier today, according to the prosecutor's office. But they are expected to include driving while intoxicated, driving without a license and causing a death when driving intoxicated which is a felony -- Erin.

BURNETT: All right. Athena, thank you.

And next, so if you make crunching noises and lick your fingers while eating Doritos, we have a story for you.


[19:57:43] BURNETT: Tonight, a bad, bad idea to ruin good chips. We are talking about the Lady Dorito.

Here's Jeanne Moos.


JEANNE MOOS, CNN CORRESPONDENT: Let the chips fall where they may.


UNIDENTIFIED FEMALE: I think I can eat the crunchiest messiest Dorito I want and enjoy the hell out of it. MOOS: Sounds like she has a chip on her shoulder after the CEO of

PepsiCo suggested her company was developing chips for her, because men eat Doritos differently from women.--

UNIDENTIFIED FEMALE: They lick their fingers with great glee.

MOOS: And guys like to tip back the bag.

Men like to be macho with their nachos. While women --

UNIDENTIFIED FEMALE: They don't like to crunch too loudly in public. They don't lick their fingers generously.

MOOS: Tell that to this former Miss Australia.

UNIDENTIFIED FEMALE: I definitely lick my fingers after. I love it.

MOOS: Even a network morning show host couldn't resist.

UNIDENTIFIED FEMALE: No, I do want a silent chip.

UNIDENTIFIED FEMALE: No, I love a loud crunch.

SETH MEYER, HOST, LATE NIGHT WITH SETH MEYER: Because there is no more appropriate snack for the Me Too era than a chip that wants you to be quiet.

MOOS: The only quiet chips are stale chips, tweeted model Chrissy Teigen.

Read another comment, my generation marks so future generations of women could enjoy lady Doritos.

UNIDENTIFIED FEMALE: Go tell Sojourner Truth and Susan B. Anthony they can finally rest in peace.


MOOS: Though PepsiCo's CEO promised snacks designed and packaged for women would launch soon, the company said, we already have Doritos for women. They're called Doritos.

Some men stood up for women's right to crunch.

UNIDENTIFIED MALE: Just as loudly and obnoxiously as men do.

MOOS: But there are worse things than eating low crunch lady chips.

UNIDENTIFIED FEMALE: Oh my God. Did you just eat that?


UNIDENTIFIED FEMALE: Axel clipped his toenails in the chip bag. You just ate Axel's toenails.

MOOS: Tweeted one cruncy Doritos fan: could we just get quiet bags instead?

Jeanne Moos --

And licking your fingers is cool?


MOOS: -- CNN, New York.


BURNETT: I've been eating Doritos the whole time. Just to make a point. (INAUDIBLE) Oh, we didn't plan this. I'm sorry, Anderson (INAUDIBLE) loudly.

Here you go, Anderson.