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At This Hour

Trump Dismisses Tariff Backlash: "Trade Wars Are Good"; GOP Lawmakers Call On Trump To Scrap Tariffs Talk; Police: Two Killed On Central Michigan University Campus; FBI Counterintel Investigating Ivanka Business Deal; Sources: Nunes Leaked Warner Texts To Russian Lobbyist. Aired 11-11:30a ET

Aired March 02, 2018 - 11:00   ET

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

[11:00:10]

ERICA HILL, CNN ANCHOR: Good morning. I'm Erica Hill in for Kate Bolduan. Washington whiplash. That's about the only thing that is predictable at this point coming out of the Trump White House especially in the past 24 hours.

The president's shock announcement of steep tariffs sending markets skidding across the world. Wall Street as you can see right now dropping 300 points. This is in the first -- that was in first 8 minutes of trading. Live look now. Enemies and allies alike worried, threatening retaliation as the president doubles down this morning, saying and I quote, "trade wars are good."

President Trump holding a chummy meeting with the top lobbyists for the NRA and the gun lobby says the president opposes gun control. So, has he already abandoned everything we heard in that live television bipartisan meet with talk of gun reform?

After months of chatter, there may be a time frame to H.R. McMaster leaving his role as national security adviser. One administration official says it could be by the end of the month.

With her full security clearance still in limbo, first daughter, Ivanka Trump now under FBI scrutiny. CNN exclusively learning counterintelligence officials are investigating one of her international business deals.

CNN's Kaitlan Collins is at the White House. The president this morning, Kaitlan, facing bipartisan criticism on his tariffs announcement, but he is not backing down.

KAITLAN COLLINS, CNN WHITE HOUSE REPORTER: He's certainly not backing down, Erica. In fact, he seems to be doubling down and he seems to be very dismissive of the criticism that he stunned his own aides when he announced that he's going to be imposing tariffs on the aluminum and steel imports.

And also, shocking GOP lawmakers and rattling the stock market, but the president doesn't seem to be phased by any of that. In fact, he was tweeting this morning saying that he believes trade wars could be a good thing and easy to win. And he said, for example, that when we are down $100 billion, with a certain country, and, quote, "They get cute, don't trade anymore and we win big. It's easy." The president seems to be very dismissive of the criticism that he's receiving, the blow back he's receiving from all of this, and what he's implying with his tweets this morning, Erica, is that he seems to be just getting started.

HILL: And, of course, this is all coming on the heels of lots of other activity in the White House, just a day after the president said he supported gun reforms. We know he met with the NRA's chief lobbyist who seemed to suggest the president is now backing away from those proposals. Do we have any further clarification of where he stands at this point?

COLLINS: Well, that's a great question. White House aides are even unable to articulate where the president stands on guns. You can see why because now according to that NRA lobbyist who met with the president here at the White House in the oval office, last night, something we only found out about because the president tweeted about it.

The NRA lobbyist tweeted a message saying that the president and the vice president are strong supporters of the Second Amendment and due process and he said that they do not want gun control.

Now that probably comes as a surprise to most people including the NRA who watched the president on Wednesday during that televised, very interesting meeting with lawmakers here at the White House, where the president showed a very strong, very surprising amount of support for these gun control measures.

Including expanding background checks, something that the NRA has rejected, and including raising the age to purchase certain firearms, something that the NRA has said that they do not like, and also throwing out that he wants to be able to take guns away from people who are mentally ill and saying that he doesn't know if there should always be due process in those situations.

Something that certainly a lot of people probably would have paid to see the NRA's reaction to the president saying that during that meeting with lawmakers, but now you know, just less than a day after the president made those points, the NRA seems to say the that the president is backing off of those, and that he's more in line with their views on what to do going forward in light of that tragic school shooting in Parkland, Florida.

So, a lot of chaos and whiplash coming out of the White House here in Washington and on Capitol Hill, Erica. But one thing that has been consistent, I should point out, in the middle of all of the stories here at the White House is that the National Security Adviser, H.R. McMaster, seems to be on his way out the door and that they are planning an exit strategy.

Someone we know that the president has disagreed with ever since he has been the national security adviser, but Erica, it's safe to say it is a very chaotic day once again here at 1600 Pennsylvania Avenue. HILL: Well, at least, you can count on the chaos, though, right? So, there is that. Kaitlan, thank you.

Some of the harshest critics of the president's proposed tariffs are members of his own party. GOP lawmakers speaking out, warning of backlash as Republicans are already facing a tough election year. CNN's Sunlen Serfaty is on Capitol Hill with more of that reaction -- Sunlen.

SUNLEN SERFATY, CNN CORRESPONDENT: Yes, Erica, essentially two words coming from top Republicans up here on Capitol Hill, big mistake. In a very short period of time, we have heard a whole lot of concern coming from members of the president's own party about this policy.

Not only the way it happened, the fact that many of them were not given a heads up, many of them feel that they were not properly briefed, they were caught essentially flat footed about this policy announcement, but mostly on the policy.

[11:05:13] The fact that many Republicans are just flat out against it. And we've heard warnings coming from them, warning that it could lead to a trade war, warning about potential retaliation coming from other countries.

And warning, they say, that it could be Americans that could be paying essentially the final price of all of this. Top Republican Senator Mike Lee calling this flat out a tax to describe this tariff announcement, saying it is a huge job killing tax hike on American consumers.

Also, Senator Orrin Hatch, someone who is typically very much in lockstep with the administration, he said yesterday, quote, "I don't believe in tariffs, they don't work well. Secondly, it creates a tariff war and I don't think that's the way to go."

And many top Republicans up here on Capitol Hill are urging the president to rethink, reconsider this policy announcement at least hold off before taking any formal action. As we know, even though there is widespread criticism and concern coming from members of the president's own party, Erica, the White House still intends to finalize this policy potentially next week.

HILL: Sunlen Serfaty, appreciate it. Thank you.

Republican lawmakers as you just heard warning of the tariff's unintended consequences. We want to dive a little deeper, the potential impact, both the political and the economic.

Rana Foroohar is CNN's global economic analyst. Christine Romans is CNN's chief business correspondent, and Chris Cilizza, CNN Politics reporter and editor-at-large. One of the questions that has come up repeatedly this morning is what the president said. The president said very clearly, a trade war is good, and it is easy to win. Rana, is a trade war good?

RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: Absolutely not. Nobody in history ever said a trade war is easy. Look back to the great depression, the trade war is what caused that, not the market crash but the trade war. If you look at the facts here too, this is supposed to probably hurt the Chinese. That's the rhetoric.

The Chinese send us about 0.2 percent of their exports of steel and aluminum, not going to hurt them. It is going to hurt U.S. consumers who are going to pay higher prices. We're already seeing potential threats of retaliatory measures by the E.U.

They are talking about, you know, putting tariffs in place on the U.S. You're seeing E.U. companies like Electrolux, a big company, saying we're not going to open a factory in Tennessee that we had planned.

HILL: Well, the president has also said very clearly, look, I want to protect the country, the workers, I want to protect the steel industry. There is a big difference between the steel industry and all of the industries in this country which use steel and the millions of jobs. Tied to that.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: It is true. Tariffs narrowly protect one part of the economy, say aluminum smelters. I've seen estimates of hundreds to thousands of new jobs in aluminum smelting. You can look at steel production.

Steel workers is maybe 140,000 of those. Look outside of that in the United States in manufacturing, 6.5 million jobs by one estimate depend on using the raw material to make something else.

You know, this is something that the National Retail Federation has called a tax on American families because you'll pay for it in cars, airplanes, appliances, construction equipment, house, cans, beer -- stop the presses of beer.

HILL: Beer is important. It is a Friday. So, it has been a rough week for people in Washington. So, let's not discount the impact on beer. In all seriousness, though, we're just hearing Wilbur Ross in the last few moments on CNBC pushing back to all of the points that you're making and saying it is not a big deal.

ROMANS: He used the example of a car, $35,000 car, he said, if you're talking about a steel that is $700 a ton, and you add $125, it is not a big deal. I don't know if you're a Trump voter who is struggling to pay $35,000 for a car, it might be a big deal.

FOROOHAR: There is a lot of collateral effects. You think about inflation, could be caused by higher consumer prices. That causes the fed to raise interest rates faster, makes everybody's debt get more expensive. There are lots and lots of fallout. The only thing is going to do is create more political tension. If we get into a full- blown trade war here, that could really derail the recovery that we're seeing and politically it is just an amazing move.

ROMANS: Here is the thing, the stock market is down 1 percent, 1 percent yesterday, if they really believe he were going to do this, I think the market would be down further.

FOROOHAR: That's probably true.

HILL: And Chris, I want to bring you in on that point, two things I want to pick on, on what you both said. So, A, will he follow through, will he do this? Let's be clear, this plan is not really flushed out. We don't know exactly what is in it. That's an important part of the equation here.

Number two, when we talk about Trump voters, which you brought up, Christine, this is also the president keeping a promise. This is the president doing exactly what he said he would do.

CHRIS CILIZZA, CNN POLITICS REPORTER AND EDITOR-AT-LARGE: On the will he follow through, I don't know. I mean, you know --

HILL: I love the gesture. We'll make that into a gif.

[11:10:01] CILIZZA: I mean, how could you at this point, right? You do the segment on guns, and I'd say the same thing. Immigration. We have been down this road before. Past is prologue. The answer is probably not.

Just because he does say things that his aides scramble to try to make policy behind that. It is not clear whether -- he usually doesn't necessarily stick to what he originally said. Asked whether it is keeping promise, it is, and it isn't.

Christine touched on it. It is in that Donald Trump talked relentlessly on the campaign trail about we have presidents and politicians who make bad trade deals for us. They make good trade deals for other countries, we're going to renegotiate all of those trade deals.

We're going to renegotiate, we're going to get better terms for us. We're going to make sure other countries know that we come first. So, yes, the problem, of course, is that if you think that a car company is going to say, well, yes, the tariff on steel means it will cost us more money to make this car, but we'll eat that cost, we won't pass it down to the consumer.

Like you're not familiar with the way in which business works, so they will be -- like, yes, on one hand, no on the other hand in that it is going to impact people who may not even understand necessarily that that impact is coming from a thing that they support which is we need more American jobs, we need to stop making bad deals.

FOROOHAR: And on the point about jobs, what kind of jobs would you be protecting here? You would be protecting, you know, a few very old- line manufacturing jobs of a kind that are going away anyway. You look at, you know, in 2002, under the Bush administration, when there were tariffs slapped briefly, the steel production it declined. The industry didn't recover. There were retaliatory measures in the WTO. We need to be -- we need to be spending money training at 21st Century workforce, not trying to protect steel jobs.

CILIZZA: The retaliatory measure is important. Donald Trump in his tweet seems to -- he acts as though we're the lone player and other countries will do nothing in retaliation. Well, we'll just set this up and then they'll just have to pay us, boom, bam, we won. The other countries are going to retaliate.

HILL: Well, we'll continue to stay on it. We do have to leave it there. Appreciate it. Rana, Christine, Chris, thank you all.

I want to get an update on some breaking news following throughout the morning. Police now say two people have been shot and killed on the campus of Central Michigan University. CNN national correspondent, Jason Carroll joins us now with more -- Jason.

JASON CARROLL, CNN NATIONAL CORRESPONDENT: We do have some updated information for you, Erica. Those two people shot and killed apparently this according to Central Michigan University Police were not students at the university. And the suspect in all of this has been identified as well.

Police looking for a man by the name of James Eric Davis Jr. He's about 19 years old, stands about 5'10", wearing a mustard colored jeans and possibly a blue hoodie, may have taken that hoodie off.

just to recap, this all began around 9:00 a.m., happening at once again Central Michigan University at Campbell Hall, a coed dorm at the university. The school immediately went on lockdown. Students requested to shelter in place and at this point the suspect is still at large.

And, Erica, in terms of a motive here, police are basically saying that they believe that this situation started from some sort of a domestic situation. The governor weighing in on this, thanking first responders for their quick response and saying the main priority right now is the safety of the students there on campus -- Erica.

HILL: Jason with the latest there. Jason, thank you.

Coming up, a CNN exclusive report, the FBI now probing a business deal involving Ivanka Trump and it could be a big hurdle in her attempt to get a full security clearance. Those details next.

Plus, millions of Americans in the path of a powerful nor'easter, slamming the east coast. More than a thousand flights already canceled, hurricane force winds hitting major cities, we are live in the center of the storm.

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[11:18:13]

HILL: CNN has learned the FBI is taking a closer look at one of Ivanka Trump's foreign business deals. Sources say they're zeroing this on the negotiations and the financing surrounding the Trump International Hotel and Tower in Vancouver. The extra attention could make it harder for Ivanka Trump to get full security clearance she needs as an adviser to the president.

Joining us now, CNN crime and justice reporter, Shimon Prokupecz. Shimon, walk us through what we've learned.

SHIMON PROKUPECZ, CNN CRIME AND JUSTICE REPORTER: Right. So, Erica, what we've learned is as part of her background check, as part of some of the security clearance work, the FBI has been going over some of the financial deals, some of the meetings that she has had with foreign contacts.

And for some reason this deal in Vancouver has raised some issues. We don't exactly know why it raised these issues, but for some time now the FBI has been pouring over the details of it, some of the meetings that she has had surrounding that deal, the property, the hotel, the residents there opened in February 2017.

And ever since then really the FBI has been focusing, zeroing in on some of the meetings, going over the financial records. We have to be clear she's not under investigation here or that she is a target of this.

But as we have been reporting, there has been a lot of concern from the FBI, from counterintelligence officials that foreigners -- foreign contacts, people who were having discussions with Jared Kushner, with Ivanka Trump, with other people in the Trump orbit, were trying to exploit them for some of their financial issues, for some other issues.

And perhaps to have some kind of leverage over them and that's what this whole investigation could be about for the FBI certainly and for U.S. counterintelligence officials.

HILL: All right. We'll continue to follow that. Shimon, thank you.

Joining me now, Michael Zeldin, CNN legal analyst and former special assistant to Robert Mueller at the Justice Department. Michael as you look at this and what we are learning, should the White House, should Ivanka Trump be concerned at this point?

[00:00:00] MICHAEL ZELDIN, CNN LEGAL ANALYST: I'm not sure she should be concerned from a legal liability standpoint from what we have seen. But from an appearance standpoint, they're having the same problems that Jared Kushner is having, which is they have these buildings that are populated by a lot of foreign investors.

Either as investors or participants of the property, and a lot of those people, like in panama and in this case, they have links to government or organized crime and that creates a lot of problems potentially for them from a leverage, blackmailing standpoint.

So, yes, they should be concerned reputationally, not yet legally, but, you know, in the positions that they hold, reputation is as important as legal liability.

HILL: And what about Robert Mueller at some point speaking to Ivanka Trump? I told Shimon in the article he wrote last night, you were somewhat surprised that he hasn't been. Why?

ZELDIN: Because she sits in an important place in many of the key meetings. The Air Force One memo that was misleading statements about what happened on the June 9th meeting between Donald Rr. and the Russians, she seems to have her father's ear throughout, not only the campaign, but the transition and that went into the White House.

Mueller is investigating all different phases of that timeline. So, she has to have information in the same way that Hope Hicks had to have information and we know that he has an interest, Mueller does, in Hope Hicks because he's interviewed her for two days and we know Congress isn't just interested in her, because they interviewed her for 10 hours.

So, I just don't understand why Ivanka has yet to be brought in. I expect that she will, but probably that Mueller is biding his time, waiting for the appropriate time when he was all the evidence that he needs just like with the president to bring her in, and examine what she has to say.

HILL: Michael stay with me. I just want to bring in Jamil Jaffer, a former associate White House counsel in George W. Bush's administration. You know, Jamil, when you take all this in and where we stand, let's pretend that you're back in the White House right now in that role, but in the Trump White House. How are you advising him with all of the headlines coming up, with all of these questions continuing to pop up?

JAMIL JAFFER, FORMER ASSOCIATE WHITE HOUSE COUNSEL, GEORGE W. BUSH ADMINISTRATION: The real challenge here is that this is getting in the way of the president's agenda. It's making it hard for him to operate, these clearances, all these questions of foreign influence, even if they're not true, it is making it hard for the White House to get the job done.

In some ways you want to say if we can clear the issues off the deck, put the people in a position of doing something else, we can focus our agenda, tax cuts, regulatory reform, judges, national security, that's the hard part.

HILL: There's also in terms of the security clearances, again, it is tough to know where we stand because the White House refuses to comment on any of the security clearances at this point, but we can't ignore the fact that Jared and Ivanka are a package deal here because they're a married couple.

So, what one spouse does and how that impacts their application, how they're going through the process for their security clearance, it can directly affect the other one as well. Do you see in the future that this downgrade we saw for Jared Kushner could come back to haunt Ivanka?

JAFFER: Well, certainly in the sense that people always -- the FBI always looks into the question of whether foreigners can influence the spouse of an individual and if they can, that can put pressure on the individual who has access. You're exactly right, even if only one of them maintains access to the president or to highly classified information, if their spouse has a security clearance problem, that's going to be an issue. HILL: I'm sorry, Michael, go ahead.

ZELDIN: That's exactly correct. That's why we -- we are agreeing this package is such a problem for the president that he really has to make a decision about whether or not it is in his best interest to keep them on.

HILL: There is also the separate issue about the leaks in the White House and the frustration with the president. As we're bringing in Devin Nunes into the conversation, as we look at all of this, Michael, are we seeing a total breakdown of congressional ethics at this point?

ZELDIN: Well, on the House Intelligence Committee side, there are things that are going on that are just incomprehensible to me from a law enforcement intelligence standpoint, which is to say that this FBI memo that -- the memo that Nunes wrote that the FBI opposed his release gets released with the president's blessing, unbelievable to me.

The fact that Nunes goes to the White House and has meetings about the drafting of that memo, and about other counterintelligence information, just undermines the separation of powers that is so important in the intelligence space.

I just don't understand what it is that Congress, particularly this committee and this individual congressman is thinking when they have to step back and look at their real role, which is to protect America from counterintelligence threats. It just doesn't make sense to me.

HILL: Jamil, do you think there is a chance that Robert Mueller could end up looking at Devin Nunes?

JAFFER: You know, I doubt it. Devin Nunes is protected by the Constitution, the speech and debate clause in his official role as a member of Congress. So, I wouldn't worry about that. But honestly, I think Michael is right, you know, congressional oversight is important to making sure the intelligence community, FBI, the Justice Department is doing the right thing.

[11:25:09] But whether that takes place in a partisan way, and hear about members leaking stuff, particularly about other members of Congress, if it is true, that's troubling, something we need to be focused on as an American public. At the end of the day, what's going on here is Russian interference in our political system, and if we can't get it together and work together in a bipartisan way, we're going to have real problems as a country.

HILL: Jamil and Michael, appreciate it. Thank you both.

Coming up, millions across the northeast are bracing for a storm, some of them in it at this point. Hurricane force winds, the nor'easter has already led to the cancellation of more than a thousand flights. Experts warning this has the potential to create chaos across several states. Stay with us.

(COMMERCIAL BREAK) HILL: A nor'easter is hammering the east coast right now. The strength of the storm being compared to a Category 1 hurricane. It is a nasty mix of those hurricane strength wind gusts as well as heavy rain, heavy snow in some areas.