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Does Trump Want Sessions Gone?; Did Kushner Use White House Influence to Acquire Company Loans?; Putin's Nuclear Threat; Interview With Connecticut Senator Richard Blumenthal Dow Plunges 400+ Points After Trump Announces New Tariffs; Suspected Russian Troll in U.S. Goes into Hiding. Aired 6-7p ET

Aired March 1, 2018 - 18:00   ET

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


[18:00:05]

WOLF BLITZER, CNN HOSTOSTHOST: New White House reaction tonight to the Russian leader's ominous warning.

And America's Russian troll. CNN is on the trail of a woman allegedly linked to Moscow's meddling in the 2016 presidential election. What is she doing in the United States? And why is she in hiding tonight?

We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

BLITZER: We are following multiple breaking stories, including the sell-off on Wall Street unleashed by President Trump's new announcement on tariffs.

But, first, CNN has learned that FBI counterintelligence officials are now investigating at least one of Ivanka Trump's foreign business deals.

I will get reaction from Senator Richard Blumenthal. He's a Democrat on the Judiciary Committee. And we will get reaction from former Defense Secretary Leon Panetta. He's also standing by, along with our correspondents and analysts.

Here now, though, with our exclusive new reporting on Ivanka, CNN's Sara Murray and Shimon Prokupecz.

Sara, first to you. A lot of attention has been paid to Jared Kushner's business deals, but now one of his wife's deals is drawing investigators' interest.

SARA MURRAY, CNN NATIONAL POLITICAL CORRESPONDENT: That's right.

We've been learning that U.S. counterintelligence officials are interested in the Trump Hotel and Tower in Vancouver. This is a deal that Ivanka Trump was the point person on. It opened in February of 2017.

So, it's one of the few sort of Trump-branded businesses that has emerged since Donald Trump became president. And much like these Trump Organization deals have worked in the past, they don't own the building. They just enter into these sort of licensing and branding agreements with the developer.

In this case, the developer happens to be a member of one of Malaysia's wealthiest families. He worked directly with Ivanka Trump as they were trying to make this project happen. And like many of these Trump buildings, it's a combination hotel and tower, which means there are a number of luxury condos. And they have attracted a number of foreign buyers.

Now, it's not clear exactly why you U.S. counterintelligence officials are interested in this deal, if it could be the timing, the proximity to when Donald Trump took office, if it could be the negotiations surrounding this or the flows of foreign money going through it. Much just isn't clear yet, Wolf.

BLITZER: You're getting more information, Shimon, as well about why counterintelligence might be interested.

And as far as Robert Mueller's investigation, could this potentially fit in there?

SHIMON PROKUPECZ, CNN CRIME AND JUSTICE CORRESPONDENT: It certainly can.

We have no indication that this fits into anything that Mueller is doing. But keep in mind, Wolf, that the FBI's counterintelligence, the agents assigned to the program, are working with Mueller on this, anything to do with Russia, China, and as it relates to the White House and to people around the president, his family, his friends.

Look, for months now, we have been reporting that Mueller, his team and the FBI have been looking at this, have been wondering us about some of these financial deals. And they have gone far back many years to look at this.

We don't know exactly what it is in this particular one that triggered the FBI's concerns. But we have been told -- certainly, I have been told by people that there was something triggered, that there's a concern here. Keep in mind both Jared and Ivanka's foreign contacts are being scrutinized by the FBI.

We just reported last week about China and Anbang deal on 666. There's always this concern within counterintelligence -- among counterintelligence folks that foreign nations, people perhaps working on behalf of these countries, are trying to exploit weaknesses of people who are potentially in position of power here.

And that's what this could be about, right? Like, we're basically -- we have no information that Ivanka is a target of this investigation or anything like that, and this could just be a concern again of foreign countries, of foreign nations trying to exploit some of the weaknesses that they may have.

BLITZER: And it's interesting, Sara, because so many of the president's inner circle, they have been called to testify before congressional committees or before Robert Mueller's investigators as well.

But so far, little interest in Ivanka Trump, even though she -- yes, she's the president's daughter, but she is also a senior adviser.

MURRAY: That's right.

We haven't seen her out in front of the House Intelligence Committee, the Senate Intelligence Committee. She said in an NBC News interview that she hasn't been called into to see Mueller.

It's kind of interesting. She was potentially privy to a couple moments that we know that Mueller has been interested in his obstruction of justice investigation. But her representatives are certain that she is not a target, that she is not of interest.

They went to great lengths to make that clear. Now, one of the things which could potentially for a hurdle up for her is her security clearance. Obviously, we saw with her husband, Jared Kushner, he couldn't get the full security clearance because of the special counsel's probe, but also because of his foreign contacts.

Now, a representative up Ivanka Trump's ethics counsel said this. "CNN is wrong that any hurdle, obstacle, concern, red flag or problem has been raised with respect to Ms. Trump or her clearance application."

He goes on to say: "Nothing in the new White House policy has changed Ms. Trump's ability to do the same work she's been doing since she joined the administration."

[18:05:05]

And, of course, Wolf, that is the policy we thought instituted by John Kelly, which said, look, we're not going to let you sit on an internal security clearance anymore and have access to all this top-secret information. We're going to start downgrading security clearances if you cannot get a full one.

BLITZER: But neither -- neither Jared Kushner or Ivanka Trump has top-secret, sensitive -- sensitive, compartmented information, SCI information, that top-secret security clearance. They have an interim, secret security clearance.

MURRAY: Well, what we know next week is that Jared Kushner's security clearance was downgraded to secret. He no longer is operating under the interim security clearance.

The White House, Ivanka Trump's representatives will not give us the current status of her security clearance. We know, of course, that she'd been operating on an interim one for months.

BLITZER: I think General Kelly, the White House chief of staff, suggested she only had interim security clearances. I could be wrong. MURRAY: Yes. We know that as of November when we saw this list of

people who are operating under interim security clearances, she was on that list because of potentially concerns like this, but also because of the scrutiny that her husband's under as part of a special counsel probe and his business deals.

(CROSSTALK)

MURRAY: These issues are all interwoven. And so it's possible that there could be something going on with her husband's clearance that impact Ivanka's ability.

BLITZER: So neither has top-secret security clearance.

PROKUPECZ: That's right.

Because you do these SF-86 reports, you are supposed to report your -- not only your contact with potential foreign leaders, foreign nations. You have to be report your families as well or any travel by your family. So this is all interwoven, it's all connected for both of them really, Wolf.

BLITZER: Excellent reporting.

Shimon, Sara, guys,thanks very, very much.

Tonight, the White House is trying to downplay the connection between a new nosedive in stock prices and the president's announcement of trade terrorists. But the connection is clear and so is the backlash among some Republicans.

Let's go to our chief White House correspondent, Jim Acosta.

Jim, this plunge in the Dow comes as the administration already was embroiled in a new round of crisis and controversy.

JIM ACOSTA, CNN CHIEF WHITE HOUSE CORRESPONDENT: That's right, Wolf.

Another unsettling day over here at the White House and the ripple effects they carried all the way over to Wall Street, as you said. As the president was making this tariffs announcement earlier today, White House officials were scrambling for the details to give to reporters.

We still don't have all the details. And that's part of the reason why Wall Street was unsettled by all of this. House Speaker Paul Ryan through his office putting out a statement essentially saying, Mr. President, change your mind. As well as the British government, they released a statement earlier this evening trying to get to the bottom of this as well.

So more turmoil over here at the White House. And publicly, Wolf, aides to the president are pretty tight-lipped about the current turbulent state of affairs these days. And even when the president tries to turn the policy, there's a misfire that confuses people across Washington. (BEGIN VIDEOTAPE)

ACOSTA (voice-over): With the White House seemingly in a state of constant chaos all week long, President Trump tried to get back on track by turning to policy, announcing new trade tariffs are coming soon against imports of steel and aluminum.

The result? The president angered Republicans and the stock market immediately tanked.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: what's been allowed to go on for decades is disgraceful. It's disgraceful.

ACOSTA: It was another miscalculation for a West Wing that is reeling after days of bombshells, from the resignation of Communications Director Hope Hicks to the security clearance downgrade for the president's son-in-law, Jared Kushner.

One of the latest damaging reports, a "New York Times" investigation revealing Kushner's family received hundreds of millions of dollars in loans after the president's son-in-law held meetings with financial heavy-hitters.

SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: Jared is still a valued member of the administration. And he's going to continue to focus on the work that he's been doing.

ACOSTA: White House Chief of Staff John Kelly offered some four-star deadpan, as the retired general rolled his eyes and joked that he should not have left his previous job as secretary of homeland security.

JOHN KELLY, WHITE HOUSE CHIEF OF STAFF: One of the great honors of my life, being the secretary of homeland security. But I did something wrong and God punished me, I guess.

ACOSTA: White House Communications Director Anthony Scaramucci who was fired by Kelly blasted the chief of staff, saying the general has lost control of the West Wing.

ANTHONY SCARAMUCCI, FORMER WHITE HOUSE COMMUNICATIONS DIRECTOR: If the current situation and the current culture inside the administration stays exactly the way it is, and there's literally no change, there will be a lot more departures, yes. The morale is at an all-time low.

And it's trending lower.

ACOSTA: Sources tell CNN the president is outraged over the staff turmoil, but he's also directing his fury at Attorney General Jeff Sessions, who appears determined to push back on the president's attempts to politicize the Russia investigation inside the Justice Department.

"The Washington Post" reported the president has referred to Sessions as the short-sighted elderly cartoon character Mr. Magoo. QUESTION: Does the president want to get rid of his attorney general?

HUCKABEE SANDERS: Not that I know of.

ACOSTA: But the White House chaos is something Mr. Trump's GOP rivals warned about during the campaign.

JEB BUSH (R), FORMER FLORIDA GOVERNOR: Donald is great at the one- liners. But he's a chaos candidate. And he'd be a chaos president. He would not be the commander in chief we need to keep our country safe.

[18:10:07]

ACOSTA: Even when the president tries substance, he raises eyebrows, like advocating the death penalty for drug dealers, the kind of punishment handed out in less democratic countries.

TRUMP: The drug dealers, the drug pushers are -- they're really doing damage. They're really doing damage. Some countries have a very, very tough penalty, the ultimate penalty.

ACOSTA: And conservatives are still cringing after the president's comments on gun control, when he said firearms should be confiscated for mentally ill people before they have had any due process.

TRUMP: Take the guns first. Go through due process second.

ACOSTA: The NRA didn't like the sound of that.

DANA LOESCH, SPOKESWOMAN, NATIONAL RIFLE ASSOCIATION: One of the things that NRA leadership stressed to the president on Sunday is that due process must be respected.

(END VIDEOTAPE)

ACOSTA: Now, the White House has yet to offer clarification for the president's comment that it would be OK with him to confiscate firearms from the mentally ill before any due process.

And as for the departure of Hope Hicks, the White House said there's no plan yet for her replacement. And, Wolf, is that is not enough turmoil for one week, West Wing staffers are now us knocking down speculation that the national security adviser, H.R. McMaster, is on his way out soon.

A spokesman for the president said to reporters earlier this evening that they have no personnel announcement to reveal at this time -- Wolf.

BLITZER: It doesn't sound like a flat denial by any means from the White House. Thanks very much for that, Jim Acosta reporting.

Let's talk a little bit more about the White House turmoil, as well as all the breaking news involving Ivanka Trump, the president's daughter and senior adviser. Joining us out, Senator Richard Blumenthal. He is a Democrat who serves on the Judiciary and Armed Services Committees.

Senator, thanks so much for joining us.

SEN. RICHARD BLUMENTHAL (D), CONNECTICUT: Thank you, Wolf.

BLITZER: Your heard our report on Ivanka Trump. You know our reporting a Jared Kushner, her husband.

What concerns you about this, if something does concern you?

BLUMENTHAL: Well, Jared Kushner has a very sensitive and important roles in negotiating, supposedly, peace in the Middle East.

She has represented the president, most recently in South Korea. These individuals have important roles and responsibilities within the administration. And they could be compromised by these foreign entanglements, particularly since the Kushner holdings evidently are under financial pressure.

The fact of Jared Kushner's experience is a major obstacle. But combining it with these kinds of potentially compromising interests turns the White House into a kind of for-profit enterprise, at the expense potentially of the public interest.

BLITZER: So, you want them out?

BLUMENTHAL: I think that Jared Kushner has no business being in the White House, certainly not in the role that he does now.

Even with the downgrade of his security clearance from top-secret or highly classified, SCI, to the current secret, he continues to be in a potentially compromising role. And in any other administration, in any other past White House, there would be no way that he would continue in this role.

BLITZER: What about Ivanka?

BLUMENTHAL: Well, she has a lesser role, apparently. But I think both of them have to reconsider whether they would be more value to the president outside the White House.

BLITZER: You think they should both leave?

BLUMENTHAL: I think they both owe it to the president, to the ministration and to the country to play another role if they're going to have one in this administration.

BLITZER: You have seen the "New York Times" reporting that Kushner companies, big real estate companies in New York, they got significant loans, hundreds of millions of dollars in loans, after Jared Kushner met in the White House with some executives from those companies, from those lending institutions.

Is there anything that you think needs to be done about what could be seen as a conflict of interest?

BLUMENTHAL: I'm going the writing to the Office of Government Ethics, and I suspect I will be joined by a number of my colleagues, asking for an investigation of these conflicts of interest.

They plainly cry out for some kind of official inquiry. Second, in light of the downgrading of Jared Kushner's status from top-secret to secret, there has to be a debriefing and potentially damage control as to what he knew, what he may have told and whom he have told it in his various travels, because he was having conversations with Russian bankers.

He asked the Russian ambassador to give him a back channel to Russia. And these kinds of contacts with the interim clearance that he had -- apparently it was only interim because of these foreign entanglements -- cry out for some investigation.

BLITZER: There's a "Washington Post" report now that says the special counsel, Robert Mueller, is investigating President Trump's efforts to drive the attorney general, Jeff Sessions, out of his job.

We see that effort apparently continuing with the public humiliation of Jeff Sessions by the president. What would you do if the president were to remove Jeff Sessions from the Justice Department?

[18:15:02]

BLUMENTHAL: If the president were to remove Jeff Sessions at this point, I think it would be profoundly important evidence of obstruction of justice, not an act necessarily of obstruction, but clearly evidence, given now the corrupt intent that he has indicated.

There's a credible case against the present right now of obstruction of justice. But, clearly, the motive in removing Jeff Sessions has to be that he recused himself, he refused to stifle or stop the special counsel's investigation.

And the dinner meeting last night involving the attorney general, the deputy attorney general, Rod Rosenstein, and the solicitor general had to be a kind of show of resolution.

BLITZER: Yes. We just showed a still photo of that dinner. They were having dinner there. We had some video as well -- at a restaurant, by the way, right across the street from the Trump Hotel here in Washington.

Didn't have dinner at the Trump Hotel. They, perhaps pointedly, had dinner at a restaurant across the street.

So you believe that the attorney general having dinner with Rod Rosenstein and the solicitor general was sending a message to the president?

BLUMENTHAL: He was sending a message that everybody knows what's going on here. And so does the special counsel. These threats to fire the attorney general have clearly the intention of intimidating, not just humiliating, but threatening the attorney general and saying to him, in effect, if you're not going to be loyal to me, just as I asked Jim Comey to be loyal to me, you're going to meet the same fate.

And what they were saying back to the president was, in turn, we're sticking together. You fire one of us, and you will need to fire all of us. And that will precipitate the kind of Saturday Night Massacre, the outrage and firestorm, a constitutional conflagration, that either way the Senate will not tolerate.

BLITZER: Senator Blumenthal, thanks so much for coming in.

BLUMENTHAL: Thank you.

BLITZER: Just ahead: How should President Trump respond to Vladimir Putin's threatening new claims about his nuclear firepower?

I will ask the former Defense Secretary Leon Panetta. He's standing by live.

(COMMERCIAL BREAK)

[18:21:41]

BLITZER: Tonight, the White House says U.S. nuclear defenses are second to none, pushing back at Vladimir Putin's' new boast about his nuclear firepower.

The Kremlin leader claims Russia now has an invincible missile that would make NATO defenses completely useless. The warning may be hitting President Trump close to home, as Putin played a video simulating a nuclear attack on Florida.

Let's bring in our Pentagon correspondent, Barbara Starr.

Barbara, give us some perspective on Putin's claims.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, good evening, Wolf.

The Russians do have a nuclear arsenal already larger than the United States, but tonight Vladimir Putin making clear he's not stopping.

(BEGIN VIDEOTAPE)

STARR (voice-over): Vladimir Putin is boasting about new Russian weapon in a speech to parliament.

VLADIMIR PUTIN, RUSSIAN PRESIDENT (through translator): The Ministry of Defense, in collaboration with the aerospace industry, has begun an active phase of testing a new missile system.

STARR: This time with a pointed message for Donald Trump.

PUTIN (through translator): Russia still has the greatest nuclear potential in the world, but nobody listened to us. Listen now.

STARR: A Russian animation video shows nuclear warheads raining down on Florida, President Trump's home away from the White House.

Putin claiming the Russians now have a nuclear-powered cruise missile, a massive underwater nuclear drone, Russian video showing it attacking an aircraft carrier and city coastline, and an intercontinental ballistic missile that can reach anywhere in the world.

PUTIN (through translator): As you can see from the video, it is capable of attacking targets via both the North and South Pole. It is a formidable weapon. No systems, not even prospective missile defense systems, are an obstacle for it.

STARR: The Pentagon has been watching all of this for months.

DANA WHITE, SPOKESPERSON, DEPARTMENT OF DEFENSE: We're not surprised by the statements.

STARR: The Russian cruise missile already has crashed in testing, according to one U.S. official. While there is plenty of skepticism on the Russian claims about new weapons, the fundamental worry is Putin's military strategy.

The U.S. claims Russia is in violation of an arms treaty after deploying nuclear-capable cruise missiles.

THOMAS KARAKO, CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES: I think the important is to see this as part of a larger pattern of developing new capabilities, but also doing provocative things, invading small countries, and really creating a greater reliance upon nuclear weapons.

STARR: The Pentagon now planning to build new low-yield nuclear weapons to further deter Russia. Moscow is furious and claims it will defeat U.S. missile defenses.

WHITE: They know very well that it's not about them. Our missile defense has never been about Them.

(END VIDEOTAPE)

STARR: And so far, neither side is budging tonight. And the Pentagon continuing to emphasize that the Russians are well aware missile defenses are about countering North Korea and Iran, not about countering Moscow -- Wolf.

BLITZER: All right, Barbara, thanks very much, Barbara Starr at the Pentagon.

Let's get some more on all of this.

Joining us, the former Defense Secretary Leon Panetta.

Mr. Secretary, thanks so much for joining us. Let's get right to the news. As you know, when Kim Jong-un makes these kinds of nuclear threats and boasts about all sorts of capabilities, the president quickly responds on Twitter, almost immediately. But so far directly from the president, no response to Putin's boasts.

[18:25:07]

Why do you think so?

LEON PANETTA, FORMER U.S. SECRETARY OF DEFENSE: Well, we have been very concerned about this president's inability to speak out against the Russians, whether it's their effort to try to influence our election, or whether it's the kind of boasts that Putin made today.

I think it's very important for the president to make very clear that there is no such thing as an invincible weapon. Throughout history, there have always been boasts about invincible weapons, going back to gunpowder.

And the reality is, it just doesn't stay that way, because every weapon, a counterweapon is developed. And in this case, as secretary of defense, we even began following the efforts of the Russians to try to develop but these capabilities.

And I'm sure that the Defense Department has followed these activities closely, monitored them, and developed countermeasures, so that the United States still remains the most powerful country on Earth.

BLITZER: I asked the question about the silence specifically directly from the president, because, on Tuesday, as you know, Admiral Mike Rogers -- he's the NSA director -- he also heads the U.S. military Cyber Command -- said that Russia has not paid a price that is sufficient to change their behavior in this cyber -- these cyber- attacks, that he has not received an order from the president to do anything about it.

How troubling is that?

PANETTA: Well, I'm very concerned about the president's inability or refusal to counter what the Russians are doing.

As president of the United States, he's responsible for defending this country. And it is very important, when we face these kinds of threats to our national security by an adversary like Russia, that the president of the United States stands up, makes very clear that the United States will not stand for these kinds of attacks, and will do everything necessary to make sure that it never happens again.

And his failure to issue an order that requires that we develop defenses to what the Russians are doing, I think, goes right to the heart of his responsibilities as president of the United States.

And in the absence of that, I think it's really important for the Congress to think seriously about passing legislation that requires the administration to develop countermeasures to what the Russians are doing.

BLITZER: You know, it's interesting.

The president, I don't think he ever really publicly criticizes Vladimir Putin, but he does publicly humiliate members of his own Cabinet, especially Attorney General Jeff Sessions.

And according to "The Washington Post," he privately refers to the attorney general as Mr. Magoo.

Do you think Jeff Sessions will last much longer in his role, given the public berating he gets from the president? Every few weeks, it seems to happen.

PANETTA: I worry that this president goes into a freefall periodically, in which it's very hard to know just exactly what's going to happen.

We elect presidents to provide stability to this country, to make very clear what their policy is going, and to provide a degree of certainty. But this president develops chaos on almost every issue. I mean, here we have we -- I think we have a strong economy. And in the middle of a strong economy how, he suddenly decides to go with tariffs that send the market down 500 points and creates tremendous uncertainty with regards to where our economy is going.

We're talking about firearms and the opportunity to develop some certain measures in the Congress to try to deal with that. And yesterday's session creates even greater uncertainty about where this president stands.

So, almost issue after issue, area after area, particularly now with the attorney general, who represents the chief law enforcement officer in the country, responsible for enforcing our laws, responsible for enforcing our Constitution, to start making fun of him, to call him Mr. Magoo, and to challenge him the way this president does creates tremendous uncertainty in this country about where we stand when it comes to enforcing the laws in this country.

BLITZER: Yes.

PANETTA: This is not a good situation for this country.

[18:30:12] BLITZER: Yes. Just yesterday "disgraceful"; back in May, "idiot"; "beleaguered"; "very weak"; "very disappointed" in July; December, "he did a terrible thing." You see the way he's described the attorney general of the United States.

Clearly, Mr. Secretary, the White House is in disarray right now. Hope Hicks, the communications director, her resignation. Growing pressure on Jared Kushner and Ivanka Trump. And today the White House chief of staff, General Kelly, said this.

(BEGIN VIDEO CLIP)

JOHN KELLY, WHITE HOUSE CHIEF OF STAFF: The last thing I wanted to do was walk away from one of the great honors of my life, being the secretary of homeland security. But I did something wrong and God punished me, I guess.

(END VIDEO CLIP)

BLITZER: He's sort of smiling, but at the same time, probably telling the truth.

What needs to happen right now? You're a former White House chief of staff, a defense secretary, CIA director, OMB director, member of Congress. You've had every job there is here in Washington. What needs to happen to right the ship?

PANETTA: Well, as we just pointed out, this is a very troubling moment for the White House, because almost everywhere you turn there's chaos.

I think that that John Kelly, the president of the United States, very frankly the leadership, the Republican leadership in the Congress, Mitch McConnell, Speaker Ryan, need to sit down and have a very serious conversation about the issues that we're confronting here and about the operations of the White House.

You cannot have a White House that is in chaos, as this White House is. The White House is responsible for providing the staff support that the president absolutely needs in order to conduct policy. That's -- that's not happening. We're losing people. We're not seeing any kind of steady process where people follow the rules and follow procedures within the White House. And so I think this is a serious moment, where very frankly, the leadership and the Congress and the president and the chief of staff need to sit down and try to get their house in order.

BLITZER: Mr. Secretary, thanks so much for joining us.

PANETTA: Thank you.

BLITZER: Just ahead, could Ivanka Trump and Kushner's days in the White House be numbered? We'll talk about their political, legal and financial troubles, including CNN's exclusive new reporting on an investigation into one of Ivanka Trump's business deals.

(COMMERCIAL BREAK)

[18:37:24] BLITZER: We're following breaking news. CNN has learned that Ivanka Trump's foreign business deals is now under investigation by FBI counterintelligence officials.

Let's bring in our analysts and our experts. And Samantha Vinograd, what are the concerns, potentially, of this Ivanka Trump deal?

SAMANTHA VINOGRAD, CNN NATIONAL SECURITY AND LEGAL EXPERT: Wolf, I just have to do a quick reality check here, because Phil, I know you've filled out SF-86 forms as well. You agonize...

BLITZER: Tell our viewers what this is. VINOGRAD: That's a security clearance form where you're supposed to

disclose and report business transactions, foreign contacts, etcetera. And the whole point is you put all the information on there so that a foreign government doesn't have any information that the U.S. government doesn't, because you're less susceptible to bribery.

So if Ivanka failed to disclose or misreported any business deals, that's a secret that a foreign government can manipulate.

BLITZER: What do you think, Phil?

PHIL MUDD, CNN COUNTERTERRORISM ANALYST: Yes. Let me be clear here. People might mis -- might misinterpret this as a suggestion that the federal government is investigating her because she's done something wrong. That is not my interpretation of this.

This is a question about susceptibility. Is she involved in a business deal that makes her susceptible to somebody -- it could be as simple as picking up the phone and saying, "Hey, can you take this meeting?"

The second question, which is tougher. Samantha was getting at it. Did you answer that question? Did you fill out the forms reflecting this deal when you tried to get a security clearance? That's a problem if you didn't declare this on their form.

So I think people who jump to the conclusion that this says that she's done something wrong are wrong. The conclusion I jump to is did she tell the feds everything and is she susceptible to a phone call from whoever the business partners are?

BLITZER: You know, and it comes at a time, Gloria, when "The New York Times" is reporting that her husband, Jared Kushner, who's a senior advisor like she is to the president, the son-in-law, that he actually met with some bankers in the White House who later gave the Kushner family real estate business, 500 million dollars in various loans, which is raising all sorts of questions.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: I mean, this is why you have an Office of Government Ethics. This is why people divest themselves totally, completely, of their businesses before they join the White House. And this is also probably why you shouldn't hire your son-in-law or your daughter to be top political advisors to you inside the White House.

You put all of those things together. Even if you assume that nothing nefarious happened, that there wasn't any kind of a quid pro quo whatever, even assuming that, it still has the appearance of a conflict, because he is still a part of his family business. He still derives profit from it. And that's -- you know, he may not be running it, but he'll still get some profit from it. So it's a -- it's a problem.

And these -- these rules in the White House -- and you guys know this -- they're so strict generally. They are so strict. And people have been skirting around these rules in this administration. [18:40:20] BLITZER: So at one what point, David, does the president

do something about all these negative headlines?

DAVID SWERDLICK, CNN POLITICAL ANALYST: Well, look, they've got to do something ASAP about everything that's going on.

Look, you just talked to Secretary Panetta. He's had every big job in Washington. Member of Congress. Head of CIA. White House chief of staff. He was just telling you they've got to get this together, because the government can't function when the White House is in all of this turmoil.

You look at the situation between President Trump and his attorney general. You have a situation where one guy doesn't want to quit, one guy doesn't want to fire the other guy. And nothing can get done, because they won't talk about it.

BLITZER: You know, Phil, the president lost Hope Hicks, his communications director, very close aide. The special council, we're now told, is actually looking into her 2016 statement denying any Trump campaign contacts with Russians, which clearly was not true.

Does her role in this investigation, the Robert Mueller investigation, now change at all, now that she's about to be out of the White House?

MUDD: I don't think so. I mean, there's two basic questions you have going into that conversation with her. Did she witness something that the special counsel is interested in? Or did she participate in something that the special counsel is interested in?

The bit here that I'm curious about is whether she feels freer to have a conversation, not with the Congress. I agree with her. If the Congress called me down there, I'd say, "A, I'm not going and, B, I'm not talking." Because that investigation is a fraud.

My question would be if I don't have the president as a hammer on the back end when I walk out, am I going to be more open on my conversation on the front end? Maybe yes.

BLITZER: What do you think, Sam?

VINOGRAD: I think that Hope Hicks is probably weighing cost benefit right now and thinking about what she has to say and what she knows and how valuable that is to her.

The fact of the matter is she's been with Trump for a very long time. We started talking about undisclosed or misreported meetings.

SWERDLICK: Yes.

VINOGRAD: I think she might have critical insights about all of those gaps and talking about who President Trump and the administration and the transition team may have met with.

BLITZER: Yes. I think Mueller is going to be interested in continuing that conversation down the road. Stand by, guys. Just ahead, another member of the Trump cabinet

facing some spending questions. The HUD secretary, Ben Carson, gives his side of the story behind that $31,000 dining room set for his office.

(COMMERCIAL BREAK)

[18:47:15] BLITZER: We have more breaking news tonight. President Trump's surprise announcement of tariffs has Wall Street fearing a trade war. Stocks plunged more than 400 points after the president said his administration will impose a 25 percent tariff on steel import and a 10 percent on aluminum.

You know, Gloria, so many of his top national security, economic political advisers, foreign policy advisers, they think this is a horrible idea.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Horrible idea and most were trying to convince him not to do it, with some notable exceptions. Peter Navarro for one. And the president scheduled this very quickly and very hastily. It almost seems as if he was trying to do it without letting everybody inside the White House know that he was trying to do it so he could get away with it.

Was he doing it to change the subject from all of the news that we've been dealing with lately? Did he just want to look decisive and effective? Well, maybe. But the stock market plunged over 400 points. You got people inside the White House now scrambling because they are upset with what has occurred.

I mean, there was a genuine difference of opinion inside the White House. Majority of people did not want to do this. But some strong voices were on the side of the president and the president just moved quicker than a lot of people anticipated.

BLITZER: Because there is great fear this will lead to a trade war and will increase the price of all pockets that rely on aluminum, steel for American consumers. They are saying it's like a hidden tax for the American public.

DAVID SWERDLICK, CNN POLITICAL COMMENTATOR: Right. A lot of the president's advisers think it's a bad idea because it is a bad idea, Wolf. Look, you have a situation here where President Trump has been consistent on this. He campaigned saying he wouldn't be afraid to use tariffs. He said if he thought America was getting a bad deal from China, he would do this. Back in November, the U.S. Trade Commission started looking into this. Now they are taking action.

The problem is not just that you could tank the stock market like what happened today but that you're going to antagonize China, a country we are working with or against on a whole bunch of fronts just for the slim possibility that you're going to slightly shift the trade balance and that's not even --

BLITZER: China is not even a major exporter of aluminum steel to the United States, but Canada is. Take a look at these countries. You see Canada, Brazil, South Korea, Mexico, Russia, Turkey, Japan, these countries potentially could retaliate.

SAMANTHA VINOGRAD, FORMER SENIOR ADVISER TO NATIONAL SECURITY ADVISER: They could. I think David, to your point, the president doesn't seem to have a coherent policy on important issues like China. We keep flip-flopping between the president complimenting China, potentially starting a trade war with China and then going somewhere in the Middle.

He was in Beijing a few months ago. They rolled out the red carpet. He was China's best friend and we are back again to chastising them.

[18:50:03] It's very hard to keep track of what our policy is.

BORGER: And there are lots of Republicans on Capitol Hill, you saw them come out immediately. I mean, Orrin Hatch saying this is going to be a tax on the American public. You have Republicans upset with who seems to be heading off in different directions every day. One minute, he's making Republicans it's OK.

The next minute, he sounds like a Democrat. Then he's doing something on trade that top advisers say except for Wilbur Ross maybe and Peter Navarro who agree with him, everybody else, his treasury secretary disagrees with him. It just seems like he's kind of lashing out in so many different direction.

VINOGRAD: Except at Russia.

BORGER: Except -- without any sort of strategic planning here.

BLITZER: Go ahead. Button this up.

PHIL MUDD, CNN COUNTERTERRORISM ANALYST: I think there is a coherent message, and that is this is not about economics. It's about politics. His message, I predict, is going to be, I'm here to protect you. I'm going to build a wall. I'm going to throw out immigrations, and I'm going to protect you from foreigners who sent things in too cheap because their labor is cheap.

I don't know if it makes economic sense, but I can bet what the message is, I'm protecting you.

BLITZER: On this issue as far as tariffs, to deal with it, he sounds more like, you know, Bernie Sanders than he does like the Republican establishment up on Capitol Hill.

BORGER: Yes.

SWERDLICK: Yes, if you go back to 2016, Wolf, both sides of the aisle got into this thing talking about protectionism and protecting American workers. But it's not an accident that free trade was the one issue that President Obama, a Democrat, and Speaker Ryan, a Republican, agreed on, because in the global economy, that's how you move forward. Not with protectionism.

BORGER: So this may be good for his base, whereas his base may not like what he's talking about on gun control. So, in his mind, maybe he's balancing these two things out.

BLITZER: Maybe there's politics in there as well.

All right, guys. Thanks. Just very much.

Just ahead, an alleged Russia troll exposed while living right here in the United States. What role did she play in Moscow's election meddling?

(COMMERCIAL BREAK)

[18:56:40] BLITZER: A woman suspected of playing a key role in Russian meddling in 2016 presidential election is now in hiding while exposed living in Washington state.

CNN senior investigative correspondent Drew Griffin is joining us with the story.

Drew, what are you finding out about this alleged Russian troll?

DREW GRIFFIN, CNN SENIOR INVESTIGATIVE CORRESPONDENT: She's an English language specialist, Wolf, and was hired for those English skills by a subsidiary of the Kremlin-backed Internet Research Agency. But this possible Russian troll now appears to be erasing that part of her past.

(BEGIN VIDEOTAPE)

GRIFFIN (voice-over): Just last week, Agata Burdonova was a smiling Russian-speaking video blogger filming herself and telling her followers back in Russia about the marvels of living in the Seattle suburb of Bellevue, Washington.

Even crossing the street was worth a post. It doesn't change the life, she tells anyone who followed her, until you press the button.

Her life was displayed online with Burdonova blogging the smallest of details, that was until a Russian TV news service outed her as a potential Russian troll.

Rain TV, an independent Russia news channel, says it confirmed through former employees of the Internet Research Agency that Burdonova worked here at the St. Petersburg, Russia agency, the one that's at the center of the U.S. investigation into Russian meddling in the 2016 presidential election.

In Burdonova's own LinkedIn account, she describes working at the company called mixed info from 2014 through October of 2015. The company was named in the recent indictment from special counsel Robert Mueller's office as several fronts the Internet Research Agency used to obscure its conduct.

Though Burdonova is not accused of any crime, nor listed in that indictment, the description of her work mirrors the type of activities outlined by U.S. prosecutors. Burdonova's own LinkedIn account describes her work there as translations between Russian and English, managing social media accounts, and creating content on topics that included news, social sphere, history, culture, and economics.

According to the special prosecutor's indictment, the unit was referred to internally as the translator project, and focused on the U.S. population and conducted operations on social media platforms such as YouTube, Facebook, Instagram and Twitter.

Burdonova has stopped posting on her Russian social media page. Her LinkedIn account has been changed. The reference to mixed info deleted. And when contacted by CNN for comment, the prolific blogger texted, please do not waste your time. I'm not going to talk to any journalists.

(END VIDEOTAPE)

GRIFFIN: The couple moved to Seattle area in December after Burdonova's husband was hired by an international gaming company there. He is here on a work visa. She came as a spouse. Wolf, the U.S. Special Counsel's office is aware because of media reports of her presence, but they are offering absolutely no comments.

BLITZER: This troll factory still in operation, right?

GRIFFIN: That's what they believe, that this troll factory exists and is gearing up for the 2018 election.

BLITZER: The warnings from U.S. officials are very serious. Thanks very much for that report. Good work. Drew Griffin helping us.

That's it for me. Thanks very much for watching. I'm Wolf Blitzer in THE SITUATION ROOM.

"ERIN BURNETT OUTFRONT" starts right now.