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STATE OF THE UNION

Interview With Michael Avenatti; Is Rudy Giuliani Helping or Hurting President Trump?; Interview With California Congressman Adam Schiff; Interview With Trump Senior Adviser Kellyanne Conway; Stormy Daniels Trolls President Trump, Calls For Resignation On "Saturday Night Live"; Trump Knew About The Hush Money Payment But Denied It; Pence, Not Trump, Would Be Invited To McCain's Funeral; President Trump's Pick For A Doctor In This Week's "State of the Cartoonion". Aired 12n-1p ET

Aired May 6, 2018 - 12:00   ET

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


[09:00:18]

(BEGIN VIDEOTAPE)

JAKE TAPPER, CNN ANCHOR (voice-over): Legal disarray. President Trump's new lawyer is facing questions.

RUDY GIULIANI (R), FORMER MAYOR OF NEW YORK: The fact is, there is no way this is a campaign finance violation of any kind.

TAPPER: After publicly contradicting the president's own version of events.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: He will get his facts straight.

TAPPER: Is Rudy Giuliani helping or hurting his new client? We will ask counselor to the president Kellyanne Conway next.

And credibility crisis. A new report reveals President Trump knew about the Stormy Daniels hush money payment before his denials.

QUESTION: Do you know where he got the money to make that payment?

TRUMP: No, I don't know.

TAPPER: Why does the president have such a problem with the truth? Republican Senator Roy Blunt will be here.

Plus: looming showdown. President Trump says he wants to talk to special counsel Robert Mueller.

TRUMP: I would love to speak.

TAPPER: But he continues to try to undermine the Russia investigation.

TRUMP: Phony Russia witch-hunt.

TAPPER: What is Mueller's next move?

We will talk to the top Democratic on House Intelligence Committee, Congressman Adam Schiff, ahead.

(END VIDEOTAPE)

TAPPER: Hello. I'm Jake Tapper in Washington, where the state of our union is trying to get the story straight.

President Trump is in Washington, perhaps watching television as we speak, as his personal lawyer, Rudy Giuliani, tries to clean up a potential legal mess that he made for his client over that hush payment made to adult film actress Stormy Daniels.

But Giuliani's cleanup act is already raising new questions, Giuliani telling ABC News in a new interview this morning that Michael Cohen may have paid off other women if it were -- quote -- "necessary."

The former mayor is also stressing the hush money payment had nothing to do with the campaign.

(BEGIN VIDEO CLIP)

GIULIANI: I'm not an expert on the facts yet. I'm getting there. There is no way this is a campaign finance violation of any kind, nor was it a loan.

It was an expenditure. And this expenditure would have been made whether he was running for president or he wasn't running for president.

(END VIDEO CLIP)

TAPPER: This as President Trump faces new questions about his version of events.

A "New York Times" report says the president knew about the hush money payment months before he denied knowing about it to reporters on Air Force One in April.

Here to help us clarify some of these questions is the counselor to the president Kellyanne Conway.

Kellyanne, thanks so much for being here.

KELLYANNE CONWAY, TRUMP SENIOR ADVISER: Thank you.

TAPPER: So, the president's lawyer just told ABC News this morning that he didn't know whether President Trump had made similar payments to other women, but -- quote -- "I would think, if it was necessary, yes, Michael Cohen would have made similar payments."

You were the campaign manager during that time. Do you know of any other payments like this one?

CONWAY: I do not. They didn't cross my desk as campaign manager. And I would also tell you that I'm happy to answer these questions,

but I have limited visibility into what Mayor Giuliani is talking about, because, politely, he is the president's counsel. I am the president's counselor.

I will tell you, though, in speaking with the president just yesterday, when the president said no on Air Force One, he was talking about he didn't know when the payment occurred.

TAPPER: Mm-hmm.

CONWAY: It was a very-fast moving exchange between him and Catherine Lucey of the AP, I believe.

And so he is saying he didn't know about it when the payment occurred. He found out about it after the fact.

TAPPER: All right, let's play this. Let's play the exchange, if we can.

This is in April President Trump being asked by the AP, did you know about the $130,000 payment to Stormy Daniels. Let's play this exchange.

(BEGIN VIDEO CLIP)

QUESTION: Did you know about the $130,000 payment to Stormy Daniels?

TRUMP: No. No. What else?

QUESTION: Then why did Michael -- do you know where he got the money to make that payment?

TRUMP: No, I don't know.

(END VIDEO CLIP)

TAPPER: So, "It's did you know about the $130,000 payment to Stormy Daniels?"

"No."

So, you are saying that he didn't know at the time.

CONWAY: At the time.

(CROSSTALK)

TAPPER: But then the next question -- or a subsequent question, "Do you know where he got the money to make that payment?"

"No, I don't know."

That's present tense.

But he did know. CONWAY: You have to look at the president's three tweets.

Again, I'm going to relay to you what the president has told me, which is the best I can do. He didn't know it at the time that the payment occurred.

Separately, if you look at his three tweets this week, he said a lot in his three tweets on Thursday morning, Jake. I'm sure you have them or people can pull them up to themselves. It's democratization of information. The president tells everybody at the same time what is on his mind.

In those tweets, he went back and repeated that this was a private arrangement, and there was an NDA involved, and that he is saying these are false claims, and that Ms. Daniels and her attorney have violated that NDA. This is the president speaking.

And the president says it is a very typical course of action for famous people or people who are wealthy. And the president has said that he did this to save his family the embarrassment.

I will tell you, as the campaign manager for the winning part of the campaign, I was not made aware of this whatsoever.

And I would push back on this whole notion that, well, what if this had come back before the final debate? All of it was out there. The president at the rally...

(CROSSTALK)

TAPPER: The Stormy Daniels story wasn't out there.

CONWAY: Well, but there were all these what the president referred to as false accusers. They had plenty of airtime here and elsewhere. They were lining up.

[09:05:02]

And he would address them at his rallies. He was doing six, seven different stops a day.

And I will tell you, at the White House, when I show up to my job every day, this is not on -- in my policy portfolio.

TAPPER: But those are different. First of all, you have more than a dozen women accusing the president of sexual assault or sexual harassment.

That is different from a porn star who claims...

CONWAY: And he's...

TAPPER: ... that she had a consensual affair with the president...

CONWAY: He's denied that.

TAPPER: ... just months after the president's son was born.

CONWAY: Well, he has denied all of that. But the point I'm making to you is talking about a campaign...

TAPPER: Do you believe him? Do you believe him? Do you believe that he did not have an affair with Stormy Daniels?

CONWAY: I believe -- yes, he's denied it. So, I have no reason to believe otherwise.

I don't know -- he has said he hasn't.

But that has got nothing to do with my job in the White House, his job in the White House, or, frankly, the campaign. Now, you have had the president, his lawyer...

TAPPER: Well, it does if he made a payment so as to affect the campaign.

CONWAY: He has said -- he has said he hasn't. And...

TAPPER: But if the -- it was -- they had this alleged affair in 2006, and he didn't pay her until October 2016. There is a decade there that he could have paid for.

CONWAY: He's telling you that he didn't pay her, his attorney did.

I'm telling you that his attorney had discretion, as far as I can see. His attorney had discretion over funds and made the best call that he...

(CROSSTALK)

TAPPER: When did the president find out that Michael Cohen had made this payment?

(CROSSTALK)

CONWAY: That, I don't know. But I know that the president has said he didn't know it when it occurred. And that is the no on Air Force One.

Now, respectfully, I know that CNN has invested a lot in this story and in Ms. Daniels' attorney, Mr. Avenatti. He has appeared on your network over 65 times in less than two months. That's a choice that you make.

But when I look at the CNN polling, Jake, I don't see this on there. I see the economy and immigration and health care. I see ISIS. I see historic talks in North Korea. We are on the precipice of ending decades of war between North Korea and South Korea, owing in large part to this president's leadership and him involving other leaders in that entire region.

The JCPOA is coming up now, the Iran nuclear deal, which this president said from the beginning... TAPPER: Yes, these are all issues we talked about and continue to

talk about. And we would have liked to have...

CONWAY: Well, not as much.

TAPPER: Last week, when the North Korea thing happened, we would have liked to have Bolton or Pompeo on the show.

CONWAY: I hope they will come here.

TAPPER: They refused to do the show.

I do think it is important, though, whether or not the president of the United States tells the truth to the American people. And I'm sure you agree with me.

"The New York Times" is reporting that the president knew months before the April denial that Michael Cohen had made this payment. This story broke in January, right?

CONWAY: Let me repeat -- let me repeat...

TAPPER: The story broke in January Michael Cohen made this payment. Are you telling me that President Trump by April still hadn't gotten to the bottom of it?

CONWAY: Let me repeat that the no refers to no at the time the payment occurred, which I read is in October of 2016.

So, the whole world found out about it, I guess, in January of 2018.

TAPPER: But the second question is, do you know where -- it was present tense. Do you know the money came from? And he said, "I don't know."

But we are being told now by "The New York Times" and others, including Rudy Giuliani, that the president did know. And it is important that the president tell the truth to the American people, yes?

CONWAY: I think, there, you want to look at the president's tweets, where he says through reimbursement.

You have got to look at his tweets, because he responds to that. And that's -- honestly, Jake, that's the best I can do, given my limited -- limited visibility in the legal matters and my very big visibility in the policy portfolio and, honestly, the great job this president is doing on many fronts that Americans tell those opinion leaders and pollsters they care about.

You can't argue with a 3.9 percent unemployment rate. You can't argue with the lowest unemployment rate in so long among African-Americans, if ever, Hispanics, women.

TAPPER: But here is the issue, Kellyanne. But, Kellyanne, this week, the White House really started to lose the support of conservatives who want to support the president, who believe in President Trump.

CONWAY: His numbers are up among evangelicals.

TAPPER: The "Wall Street Journal" editorial board, very supportive of President Trump on everything except for trade, writes -- quote -- "Mr. Trump is compiling a record that increases the likelihood that few will believe him during a genuine crisis, say, a dispute over speaking with special counsel Robert Mueller or a nuclear showdown with Kim Jong-un. Mr. Trump should worry that Americans will stop believing anything he says."

This is directly because of him not telling the truth, not being straight with the American people about this payment.

And, in addition, we have had people on FOX News Channel who are generally very supportive of the president saying to the president, to the television screen, you have to tell the truth. Stop doing this. You are eroding credibility.

As the counselor to the president, aren't you concerned about this?

CONWAY: I am concerned that you are not listening to the news I just broke, which is that the no refers to when the payment occurred. That's very important here.

This was a fast-moving exchange. I asked the president what he meant. And he said, "I didn't know about it when the payment occurred."

I think you are overcomplicating that very simple point.

TAPPER: You think that answer was as honest and open -- if that is the truth, he was talking -- if that is the truth, he is saying, oh, I didn't know it at the time in 2016, when the payment was made, do you think the president was as honest and transparent and open as he should have been?

Because he could have said, I didn't know about it at the time, but, subsequently, I found out about it -- about it, and when he asked, do you know where the money came from, do you know, present tense, he could have said, yes, I reimbursed him.

CONWAY: But, Jake, this is -- respectfully, this is what always happens, is everybody has an idea about how the president should -- how he should speak, how he should answer, the words he should have used.

[09:10:05]

TAPPER: Honestly. He should speak honestly.

CONWAY: No, no, no, he spoke honestly. He said no, which refers to when the payment occurred. But let's also be honest to your viewers, who you know full well are

so -- many of them are grateful that he is in that job because they have their job.

You are denying the five million American who have received bonuses raises for both because of a tax cut that your network continued to insist could never -- can never get through and, if it did, it would only benefit the wealthy.

Go tell that to people you and I grew up with outside of Philadelphia who are happy that he is the president because they have more disposable income. They have less regulatory burden.

TAPPER: We cover the tax cut. And I never said...

(CROSSTALK)

CONWAY: Not very much.

TAPPER: I cover the tax cut.

CONWAY: Small Business Week last week, 80 percent of small businesses have less tax burden now.

TAPPER: I have covered it a lot.

CONWAY: Gina Haspel, first female...

TAPPER: Nobody undermines the president's message more than President -- nobody undermines the president's message more than President Trump.

CONWAY: Well, I'm here to amplify...

(CROSSTALK)

TAPPER: President Trump puts out a tweet last week talking about how the unemployment rate is 3.9 percent, and he can't even stay on message in a 10-word tweet.

By the end of it, he is talking witch-hunt.

CONWAY: Well, maybe it is not -- excuse me -- maybe it is not your message, but his message is the 3.9 percent. That's the message Americans...

(CROSSTALK)

TAPPER: So, why does he undermine it with witch-hunt?

CONWAY: Those facts and figures -- I think Judge Eliot -- excuse me -- T.S. Ellis -- great poet -- T.S. Ellis in Virginia really said it best.

He is not a political figure. He has no skin in this game, except the law. And he really brushed back the Mueller folks by just saying, excuse me, have you burned through your $10 million budget yet? Where is this going?

Because this is actually to impugn or assault or indeed impeach or something else the president, that is not what this was supposed to be about.

A lot of Americans agree -- and you know that. I hear from people who didn't even vote for Donald Trump regularly...

TAPPER: Right.

CONWAY: ... Jake, that they just want the guy to be able to have the space to do his job. And his job includes saying that the Iran nuclear deal was a bad deal from the beginning, that it gave out too many benefits, too much cash for the...

TAPPER: Does his job include lying to the American people?

Does he -- do you think that his job includes lying to the American people? Because he continually does so. And he undermines his own administration when he does so.

CONWAY: Jake, he does -- he does many things.

You just want that -- respectfully, you just want that to go viral. You want to say the word "President Trump" and "lie" in the same sentence.

TAPPER: No, I want -- I would like him to stop lying, quite frankly.

(CROSSTALK)

CONWAY: Here's what doesn't lie. Here -- here -- here are some facts and figures that you should start treating your viewing audience to, the 20,000 new Apple jobs.

If Tim Cook could have brought those to this country while his ally...

(CROSSTALK)

TAPPER: I understand you don't want to talk about the president's credibility.

CONWAY: Oh, no, no, no, I have already talked about it for five minutes. What I'm telling you is, his credibility...

TAPPER: Do you think there's a credibility crisis in this White House?

CONWAY: No, I don't, because I know that you have the screaming graphics that says it. But you had screaming graphics that talked about Russian collusion too. Those are gone. And now we are talking about this.

This -- excuse me -- this...

TAPPER: I don't know -- I don't know what is gone in terms of the Russia probe.

CONWAY: The sheer volume and velocity alone of what this president accomplishes and what he puts on the table, in just one breakneck week, he has got a new secretary of state who is out there saying, our job -- his job, as the chief diplomat for this country, is to make sure Iran is never nuclear-capable.

And that is why this president has serious questions about the JCPOA. That is why, when he struck Syria a couple weeks ago, he said it was also -- we said it was also a message to Iran and Russia, who are helping Assad.

TAPPER: Which we covered.

CONWAY: Does it bother you at all that the American press corps says this president is not tough enough on Russia, and the German press corps in the East Room a week ago Friday asked Chancellor Merkel if she is concerned at how tough President Trump is being on Russia?

People care that the regulations are lower.

TAPPER: Sure.

CONWAY: They care that Israel is in the crosshairs, our greatest ally...

(CROSSTALK)

TAPPER: And they also care, and they want the American president to tell them the truth.

CONWAY: And we talked about that.

TAPPER: They want the president, the American president, to tell them the truth.

CONWAY: They know the numbers don't lie. They know 3.9 percent...

(CROSSTALK)

TAPPER: You keep talking about the unemployment rate. And it's fantastic. And we heralded...

CONWAY: Because it matters to people.

TAPPER: It matters to people, absolutely.

CONWAY: It matters to people there are over three million new jobs created.

TAPPER: It also matters to people -- it also matters to people that the president tell them the truth.

CONWAY: He is telling them the truth.

When he stood up a week ago and said, guys, Sunday -- America, Saturday is National Take Back Day, bring in your unused, expired or unwanted pills, and we collected a record number -- you can fill up three Boeing 757s with the pills.

TAPPER: He went on Twitter and talked about the three American hostages.

CONWAY: Talked about a lot of things, yes.

TAPPER: He talked about the three American hostages and how the Obama administration had tried and failed to get them free.

Two of the three were detained while Donald Trump was president. There is no way that Obama could have gotten them released, because they were captured when Trump was president.

That is just a lie. And that tweet is still up there. And that is just symbolic of the fact that this president gets in his own way all the time, even when there is something good potentially happening.

CONWAY: See, you are focusing on the tweet, and we are focused on the hostages. And...

TAPPER: But why is he blaming Obama for hostages that were taken while he was president?

CONWAY: Jake...

TAPPER: Why?

CONWAY: He is probably thinking about President Obama and the terrible Iran nuclear deal and the terrible -- what he did -- what he failed to do in North Korea.

TAPPER: So, why not just tell the truth?

Or when someone says...

CONWAY: The truth is -- here is the truth about North Korea.

TAPPER: Those -- two of those three were taken -- two of those three hostages were taken when you were president, so maybe we should take down this false tweet.

CONWAY: And all three could well be released while he's president. That's the key.

TAPPER: And God bless, and I hope that happens.

CONWAY: And he...

TAPPER: But why lie about it?

CONWAY: Well, if you hope it happens, let's cover a little bit. Excuse me. Let's cover a little bit.

TAPPER: I'm waiting for it to happen. CONWAY: What do you think is the most important thing going on in North Korea now?

I would argue it's the fact that North Korea and South Korea literally have come together, that North Korea has agreed to certain conditions, that the time and date -- the date and the place for this meeting is already in information.

[09:15:01]

TAPPER: And we will cover that summit, absolutely.

CONWAY: Well, but cover it now. Show that we want -- that we want complete, verifiable and irreversible denuclearization, that Kim Jong- un has already promised to make certain moves.

TAPPER: We do.

CONWAY: And it would be a great gesture of good will to get these hostages released.

TAPPER: Yes.

CONWAY: But, look, the same -- the same fact-checking at "The Washington Post" that everybody here loves to quote, they gave -- they -- they showed some whoppers by President Obama.

Now, you mentioned President Obama. I didn't. I didn't mention the woman who...

(CROSSTALK)

TAPPER: I mentioned Obama because Trump mentioned Obama.

CONWAY: But he had -- no, no, no.

TAPPER: But we...

CONWAY: He had a lot of whoppers that mattered to people, when he said he came right after -- out of Benghazi and said it was an act of terrorism. No, he didn't.

(CROSSTALK)

CONWAY: No, they didn't.

TAPPER: Yes, we covered them at the time. We absolutely covered them.

CONWAY: No, they didn't. That you can keep your plan.

TAPPER: OK, we have to...

CONWAY: OK.

So, look, every president is looked upon for everything they are communicating to the American people.

The president's approval ratings are up. The -- the -- I think the right direction number is up, because people see progress and security.

And I would say to you, they are also tired of him being picked upon every single day. What you are telling America is important to them is not what America is telling your pollsters is important to them.

TAPPER: OK, Kellyanne Conway, thank you so much.

CONWAY: Thank you for having me.

TAPPER: We appreciate your time.

Rudy Giuliani this morning leaving open the possiblility that Stormy Daniels might not be the only woman the presidnet's lawyer paid off. We'll talk to Stormy Daniels's attorney next.

And the president's lawyer says the special counsel's team is baiting the president to lie. Is this new offensive strategy to undermine the Mueller probe working?

The top Democrat on the House Intelligence Committee, Adam Schiff, will be here live.

(COMMERCIAL BREAK)

JAKE TAPPER, CNN HOST: Welcome back to STATE OF THE UNION. I'm Jake Tapper.

President Trump's attorney, Rudy Giuliani, keeps going on television to try to explain what the president knew about the Stormy Daniels' payoff. But even Stormy Daniels is doing television these days. She was on "Saturday Night Live" last night.

Here to react to all the latest developments is Stormy Daniels' attorney, Michael Avenatti.

Michael, thanks so much for joining us.

I want to ask you right away about the latest this morning from Rudy Giuliani on ABC News. Take a listen.

(BEGIN VIDEO CLIP)

GEORGE STEPHANOPOULOS, ABC NEWS HOST: You said he -- this is a regular arrangement he made with Michael Cohen. Did Michael Cohen make other payments to other women for the president?

RUDY GIULIANI, PRESIDENT TRUMP'S ATTORNEY: I have no knowledge of that, but I would think if it was necessary, yes.

(END VIDEO CLIP)

TAPPER: What's your reaction to that? Do you have any indication there might be other women we don't know about?

MICHAEL AVENATTI, STORMY DANIELS' ATTORNEY: Well, Jake, I think that when all the facts and the evidence come out, there's going to be evidence of payments to other women. I think that's -- that's going to be laid bare for the American people.

But I have to tell you, this interview that Rudy Giuliani gave this morning is just the latest in a series of train wrecks for Rudy Giuliani and the president. They can't get their facts straight. They keep changing every interview they give. The facts take on a new life of their own.

And this is what happens when you lie and try to cover up. And this is exactly what happens.

TAPPER: Giuliani also said this morning that he expects that Trump fixer Michael Cohen will cooperate in the investigations. But investigators might be disappointed because Cohen doesn't have any incriminating information about President Trump.

I imagine that you think he shouldn't be so sure about that.

AVENATTI: Well, no. I think he should be absolutely unsure about that. I don't think there's any question, I've been say thing for a while, that Michael Cohen is going to turn states evidence on the president and I'm confident that there's going to be a lot of evidence and a lot of conduct that's going to come to light.

I mean, the story, Jake, if we just concentrate on this $130,000 payment, and I don't want to say story, because now it's stories. The stories that they're trying to peddle to the American people are forever changing over the last few months and even over the last 72 hours.

Now, Rudy Giuliani is trying to claim that he really doesn't know the facts, isn't really up to speed as to the most basic facts. I mean, these are facts that you would found out as an attorney in the first 30 minutes of a meeting with a client. This is not that complicated of a situation.

Did the president know about the $130,000 payment? When did he know about it? Did he know about the agreement? Did he reimburse it? And how did he reimburse it?

I mean, I don't understand what's so complicated about this unless you try to hide things.

TAPPER: Well, we tried to get clarity from Kellyanne Conway on that earlier in the program and did not get any clarity on that.

Giuliani argued this morning that it's clear the president has not violated any campaign finance laws over this hush money payment. He says the payment would have been made regardless of the presidential campaign, and even if it had been campaign related, it wasn't a loan or an expenditure because the president reimbursed it. Is that right? AVENATTI: No, that's not right. I mean, you know, Rudy Giuliani

evidently doesn't -- he claims to not know the facts, but he most assuredly does not know campaign finance law. That's not campaign finance law.

Rudy Giuliani seems to believe that if the payment was not made with campaign dollars, that somehow there's no campaign finance violation. That's not the law.

I think it's clear -- look, if this $130,000 reimbursement was all above board and they weren't trying to hide anything or trying to skirt campaign finance law, then why didn't the president just write a check or send a wire for $130,000 in reimbursement funds and be done with it? Why this whole scheme about the invoices and the retainer and all of this wind up, the formation of the LCC by Michael Cohen? I mean, these are not actions you take if something is above board.

TAPPER: Well, I guess the argument that Rudy Giuliani is trying to make is, he did all that to hide the payment from his family, from Melania and others, because he wanted to spare his family the personal embarrassment, but it didn't have to do with the campaign. You can't see that argument?

AVENATTI: Well, I can see that argument, but I don't understand why -- I mean, that presupposes that the president's family has full visibility into every payment that the president makes. I mean, the president could have paid this through any number of organizations or entities that he has, I'm confident of that, without his family finding out about it.

I just don't think that that passes the smell test. I don't think any of this passes a smell test, and it violates fundamental principles of common sense. I mean, you don't have to be an attorney, you don't have to be highly educated to see through this nonsense.

And that's what -- that's a big problem for them as it relates to their strategy and lies. I mean, it's very simple for the American people to see what's going on here.

TAPPER: Giuliani also said this morning he didn't think the settlement, $130,000, was particularly substantial. Take a listen.

(BEGIN VIDEO CLIP)

GIULIANI: I know this sounds funny to people there at home, I never thought $130,000 was a real payment. It's a nuisance payment. When I saw the list for -- when it was real or real possibility, it's a couple of million dollars, not $130,000. People don't go away for $130,000.

(END VIDEO CLIP)

TAPPER: People don't go away for $130,000. Is Rudy Giuliani right, that in the big scheme of things, this is a nuisance payment in terms of the value? Because if he really had had an affair with Stormy Daniels, and there was evidence of it, the payment would have been much more substantial?

AVENATTI: No, I don't agree with that, Jake. I think it's well known that Donald Trump is incredibly cheap in many aspects of his life, and has been for decades. So, the whole idea that they just threw out $130,000 as a nuisance payment to someone that they have concluded was lying, and that he never had an affair with is absurd.

I mean, these are guys that have trumpeted their tough, negotiating skills, him and Michael Cohen, for decades. They now want to believe that a woman came with her hand out and they just promptly paid 130 grand? It's not believable.

TAPPER: Your client Stormy Daniels appeared on "Saturday Night Live." I understand it was just a joke, a light hearted appearance, but there's ongoing litigation here. Doesn't this potentially hurt your client's case?

AVENATTI: No, Jake, I don't think at all. I mean, you know, it's a comedy skit. I thought she did a remarkable job on it. I thought it was very, very funny.

I mean, you'll remember that Donald Trump was on "Saturday Night Live" when he ran for president.

So, I don't think it did any harm for the case whatsoever and I think it gave the American people another view of her that she's very talented and funny and they had an opportunity to see a side of her that perhaps they haven't seen before. So, I thought it was great.

TAPPER: All right. Michael Avenatti, Stormy Daniels' attorney, thank you so much for joining us. Appreciate it.

AVENATTI: Thank you.

TAPPER: A stunning rebuke to the special counsel's Russia investigation, a judge accusing Robert Mueller of having only one target in mind, President Trump.

We're going to ask Democratic Congressman Adam Schiff if that judge might have a point.

That's next. Stay with us.

(COMMERCIAL BREAK)

[09:31:49]

TAPPER: Welcome back to STATE OF THE UNION. I'm Jake Tapper.

The president's new lawyer, Rudy Giuliani, unveiling a more aggressive tack against the Russia investigation, raising questions about investigators' motivations and about whether the president will cooperate.

(BEGIN VIDEO CLIP)

GEORGE STEPHANOPOULOS, ABC NEWS: And the president said again on Friday that he wants to speak with Mueller, answer his questions.

So, are you prepared to make that happen?

GIULIANI: Not after -- not after the way they have acted. I -- I came into this case with the desire to do that. And they just keep convincing me not to do it.

(END VIDEO CLIP)

TAPPER: That's as President Trump and his legal team are seizing on new questions about the Mueller probe after a judge said that Mueller's team is really after one goal, taking down President Trump.

Here now, Congressman Adam Schiff. He's Democrat of California, the ranking member on the House Intelligence Committee.

Congressman Schiff, thanks for joining us.

You just heard the president touting that criticism from a federal judge about the investigation on Friday before the NRA, saying that Robert Mueller is ultimately only interested in evidence of wrongdoing by the president himself.

The president accurately quoted the judge and the CNN story about the judge. Is the judge wrong?

REP. ADAM SCHIFF (D), CALIFORNIA: Well, I'm not sure that it is germane, for example, for the judge to be asking how much Bob Mueller has spent on the investigation.

It is appropriate to ask about the scope of what Bob Mueller is doing. But he is well within the scope of his jurisdiction in charging Manafort and Flynn and the others.

In particular, I think we have to recognize that Mueller works for the Justice Department. And any case that arises from the Russia investigation is either going to be prosecuted by him or it's going to be referred out to another attorney in the department. But it's going to be prosecuted.

And in a money laundering situation, here, where you have a Russian oligarch involved, and Manafort during the campaign trying to get money from this Russian oligarch and offering information on the campaign to get it, it is clearly within the scope of his responsibilities.

And if there is other money laundering that he learns about at the same time that may or may not involve Russians, then the issue for Rod Rosenstein and Bob Mueller is, does it make sense, is this part of a coherent money laundering conspiracy, to try that all in one case, rather than bifurcating it and have a separate prosecutor and a separate courtroom having to present much of the same evidence?

So, I think Mueller is well within his jurisdiction. I can understand the judge asking certain of these questions, although some seem to be non-germane to the legal issues involved. TAPPER: Well, with all due respect, sir, the judge is basically

saying to Mueller and Mueller's team, you don't really care about Manafort and money laundering. You're only trying this case to try to get Manafort to flip on President Trump and give incriminating information about President Trump.

Mueller could have referred -- as you suggested, he could have referred this case to another set of legal circumstances, as he did with the Michael Cohen case in the Southern District of New York U.S. attorney.

But the judge here is saying, you don't really care about this. You are just trying to get Trump and, for that reason, I'm wary of the case.

Doesn't that concern you, that a judge would think that?

[09:35:00]

SCHIFF: Well, it does concern me if it influences the judge's review of the facts and the law. That seems to be the judge questioning the motives of the special counsel.

Here, the special counsel, I'm sure in discussion and consultation with Rod Rosenstein, is deciding which of the cases that have arisen from his investigation he should try personally and which should be farmed out to others. That's how the process should work.

And while it's certainly within the judge's prerogative to ask threat questions, I don't think it really bears on the legal issues. And so I think that Bob Mueller will prevail, in the sense of being able to go forward with this litigation. I don't think there is really any legal question about that.

But, yes, it is concerning that the judge would express this opinion.

TAPPER: The president's lawyers have been wary of letting Mueller talk with President Trump. But sources tell CNN that Mueller has already raised the notion of a subpoena.

The president's lawyer Rudy Giuliani argued just this morning in an interview with ABC News that President Trump would not need to comply with any subpoena.

Is there any circumstance in the world in which President Trump could dodge the subpoena?

SCHIFF: No. He is going to need to comply with a subpoena. If they take that case to court, they are going to lose.

But, look, I have to say I'm a little taken aback by this new lawyer Giuliani's strategy here. His legal defense for the president seems to be a bit orthodox, and start out by saying, you can't believe the president of the United States. That is our defense. So, when he says things, you have just got to discount them, and, more than that, trust me, this wasn't a violation of campaign laws. Neither one of those things is pretty persuasive. And other things

that Giuliani said in his maiden voyage as the president's new lawyer were deeply hurtful of the president's case, by saying that the Russia investigation, the failure to clear him and announce publicly he wasn't a suspect is the reason why Comey was fired.

All of these things are deeply hurtful to the president's case. And notwithstanding the efforts at damage control, I think this is a very unpromising strategy.

TAPPER: I want to move to news that President Trump was reportedly aware of that hush money payment by Michael Cohen to Stormy Daniels, even though the president told reporters just last month that he didn't know about the deal or where the money had come from.

The president's lawyer Rudy Giuliani told "The New York Times" on Friday that this might be a political problem for President Trump, but it was not a legal problem.

You are a former federal prosecutor. Is there a legal issue here?

SCHIFF: Well, there is a legal issue, if the president, his credibility is thrown this much into question.

Then any statements that he might make in the future about what he knew or when he knew it or the purpose of these payments are not going to be believed by a trier of fact. So, it does affect his defense.

But, more broadly, Jake -- and this gets to point you were making with Kellyanne Conway -- what Kellyanne Conway and Sarah Huckabee Sanders and, before her, Sean Spicer are doing, in taking these abundant falsehoods that come out of the White House and trying to weave them into some alternate truth, is enormously corrosive of our democracy.

Quite separate and apart from the president's legal jeopardy, just calling into the question there's -- whether there is an objective truth is so damaging to our democracy.

And I think that the president and his staff do a tremendous disservice to the country when they just weave fib after fib and try to feed it to the American public.

TAPPER: Well, that is the political question. But, of course, it is not against the law to lie to the American people.

In terms of the law, here is what it says -- quote -- "A loan is a contribution at the time it is made and is a contribution to the extent that it remains unpaid. A loan, to the extent it is repaid, is no longer a contribution."

We are now told by Rudy Giuliani that President Trump paid Michael Cohen back. Plus, he has already reported millions in donations to his own campaign, which he's allowed to do.

What is the legal problem here? I understand the political problem. I understand the corrosive to American discourse and democracy problem, but what is the legal problem?

SCHIFF: The legal problem for the president is, telling false statements about this is evidence of a consciousness of guilt.

Why would the president be issuing false statements about what he knew and when he knew it and what he said on the plane? Seemed abundantly clear he was denying knowledge of this payment, both past and present. Why would he be doing that unless he was aware that what he had done was wrong, what he had done was a violation of campaign law?

So, that is the legal jeopardy for the president. Yes, he can lie to the public, and he can't be charged with lying to the public. Now, if he lies to Bob Mueller, it is a different story.

But these public statements by the president that are demonstrably false do demonstrate some consciousness of guilt. And if I were the prosecutor in the case, I would certainly introduce these false statements as evidence against the president.

TAPPER: Congressman Adam Schiff, Democrat of California, always good to see you, sir. Thanks so much. Appreciate it.

SCHIFF: Thanks, Jake.

TAPPER: You haven't seen Stormy Daniels act or if you're just saying you haven't, she made her "Saturday Night Live" debut last night. What you missed up next.

Stay with us.

(COMMERCIAL BREAK)

[09:44:10]

(BEGIN VIDEO CLIP)

ALEC BALDWIN AS DONALD TRUMP: Just tell me what you need for this to all go away.

STORMY DANIELS, ADULT FILM ACTRESS: A resignation.

BALDWIN: I solved North and South Korea, but can I solve us?

DANIELS: Sorry, Donald. It is too late for that. I know you don't believe in climate change but a storm's is coming, baby.

(END VIDEO CLIP)

TAPPER: Stephanie Clifford aka Stormy Daniels showing the acting chops that led her to adult films, I suppose.

Our panel is with me. Senator Santorum, let's start just with the basic idea of the scandal. Forget Stormy Daniels' performance on SNL if you would.

There have been a lot of conflicting stories about what the president knew about this payment, when he knew about the payment. You heard Kellyanne Conway trying to say that when the president in April on Air Force One was asked about it he was talking about what he knew in October 2016 and not the present day.

[09:45:01]

Does this concern you? I've heard you expressed concerns about the president and his issues with sticking to facts. Does this concern you?

RICK SANTORUM, CNN SENIOR POLITICAL COMMENTATOR: Look, I think everyone on the Republican side would love to see this go away and the best way for this to go away is for -- just to put out the information, you know, settle the case. Here is what I knew and when I knew it and move on.

I don't think the American public cares much about this. I think they discounted this the idea that Stormy Daniels' revelation before the election was going to make any difference given the "Access Hollywood" tapes and everything else that was out there about the president. None of this would have made a difference.

Get the facts out there and move on.

TAPPER: And, yet, Congressman Meeks, one of the issues is that they don't do that. They lie, they dissemble, they spin, they have conflicting stories.

And I still don't have a real idea of when President Trump knew and what he knew and Kellyanne Conway didn't offer much elucidation in terms of when he actually learned about this payment.

REP. GREGORY MEEKS (D-NY), FOREIGN AFFAIRS COMMITTEE: Yes, I think the president is now panicking. So he is losing lawyers left and right. No one wants to come to his defense.

So he hired an individual who he didn't see as fit to be attorney general or secretary of state and he brings him in. Why? Because he fired Prett Bharara thinking that Prett wouldn't cooperate and he thinks Giuliani who looks like he leaks (ph) some things before has contact within the U.S. Southern District's Office and trying to get some information.

And then it is back firing on him because after having a conversation thinking they can get out in front of a story that they know is going to come out he made the statements that he made and then he tried to walk that back.

So when you lie a lot you get caught in those lies. And that is what is happening here.

TAPPER: And let me -- I want to play sound of Giuliani this morning. And his basic point is I am his lawyer. The lies to the American people don't matter because they are not a legal issue.

Take a listen. (BEGIN VIDEO CLIP)

GIULIANI: I don't know when the president learned about it. He could have learned about it after or not connected the whole thing at that time.

The reality is those are not facts that worry me as a lawyer. Those don't amount to anything what is said to the press. That is political.

(END VIDEO CLIP)

TAPPER: Lying to the American people doesn't matter to him is essentially what he is saying because that's not a legal issue. It's not against the law to lie to the American people.

S.E. CUPP. CNN POLITICAL COMMENTATOR: That might be true. But, look, Rudy Giuliani is having a difficult time transitioning from being a pundit which he has been for the past few years to being the lawyer for the embattled president of the United States and knowing what to talk about, when talk to talk about it, what to say, what not to say, getting your facts straight before you go on television and talking about it. And among all of these revelations on Comey, on Stormy Daniels, on Michael Cohen as you discussed the getting out in front of the North Korean prisoner hostage is deeply, deeply alarming.

Lives are at stake. If there is one thing you don't go off and sort of shoot your mouth off about it is a prisoner release, a prisoner of war.

I mean, these are -- these are lives at stake. Rudy Giuliani needs to get back into lawyer mode, help his client and only speak of that which he knows.

TAPPER: What do you make of all of this? Do you think actually that -- this is going to have any effect on the American people?

We've already heard Kellyanne Conway and Senator Blunt them say this morning, hey, look, you know, he is doing what he said he would do. The economy is improving. He is working on North Korea et cetera.

That matters more than lies he tells. I'm paraphrasing but that is basically what they were saying.

PATTI SOLIS DOYLE, CNN POLITICAL COMMENTATOR: We have gotten to the point where the lies are so great not only in number but in frequency that it is difficult if not impossible for anyone to believe anything that this president or this administration says on any topic whether it be North Korea, whether it be the economy, whether it be Stormy Daniels or anything else.

There is zero credibility here. And that is extremely damaging to our country, to our democracy. And I got to say it's also really offensive.

Not -- I mean, clearly to the Americans who did not vote for Trump or support him but especially to the ones who did. You know, they put a lot of faith in him. They took a chance on him and he repays them by lying to them on a daily basis and insulting them.

I mean, how stupid does he think they are to believe all of this stuff? It's infuriating really.

TAPPER: Senator, when you ran for president you enjoyed the support of evangelicals and people who tried to live a moral life according to the good book as well as -- not just the evangelicals, Catholics as well, people of faith.

One group that has not lost faith in this president are those voters even though-- I mean, he's making Bill Clinton, you know, look like a choir boy. I mean, an affair with a porn star and a "Playboy" playmate of the year, lying about it, hush payments.

[09:50:03]

I'm not excusing the Clinton years but, I mean, this is just bonkers.

SANTORUM: Yes. You might even go back to the Clinton years and the compartmentalization that happened to voters on the other side of the aisle which is, yes -- we don't (INAUDIBLE) --I mean, I saw very few Democrats defending Bill Clinton on the substance of the allegations with Monica Lewinsky and others. But they compartmentalized by saying, yes, but he's a great president on the things we care about.

TAPPER: Right.

SANTORUM: And therefore we're going to stick with him. That's going on here, too.

Now, you can say, well, the Democrats never claimed to be moral and therefore we shouldn't be -- it was a different standard for evangelicals. People care about what affects them. And they don't like what Bill Clinton did, nobody did.

Nobody likes what Donald -- nobody likes what -- but they're looking at how does this man impact me and my family when it comes to the issues that are most important to me. You can say, well, they should have a different standard.

I can make the argument that Democrats, I assume, are moral people, too, and they should have a different standard back in the 1990s. They didn't. Whether that's a good thing or a bad thing we can all have a debate frankly on both parties.

I don't think it's a good thing. I think we should hold our leaders to a higher standard but that's not what's (ph) happening (ph).

TAPPER: I want to change the subject for one second which is Senator John McCain is obviously in Arizona. He's recuperating and trying to heal from his battle with cancer.

Obviously everybody here, Senator, I know you watch a lot of CNN. Everyone here is pulling for you and rooting for you. SANTORUM: Right.

TAPPER: And I'm -- you know, I'm putting aside anything else that I read in the paper other than we're all still pulling for you. But the tension between him and Donald Trump has come up both in the book that has been released and his -- and the things he is saying in this new book. But also there are questions about and this has been reported in "The New York Times" and elsewhere that the plan would be to have Mike Pence be the one to honor Senator McCain in the hopefully long, long, long -- from now event of his demise.

This is -- this is a real moment for the country where an American hero, somebody who is beloved in many, many ways is saying, I don't want this guy at my funeral.

MEEKS: Well, you know, Senator McCain is known for being honest, the opposite of Donald Trump, and frank. When somebody would come up with something saying something negative about President Obama, he corrected them.

And so I don't -- I wouldn't expect anything to be different for Mr. McCain -- Senator McCain now. He is not going to be a hypocrite. He does not believe that Donald Trump represents the kind of moral authority that the president of the United States should represent for our country and the rest of the world.

And so it would be hypocritical of him then -- it would be a mischaracterization of who he is to say, I'm going to allow this guy to be at my funeral. He wants someone who is honest and forthright.

You don't have to agree with Senator McCain, you know, he just wants you to be honest. And that's why he has been a successful senator working across the aisles with Democrats for his entire senatorial career.

CUPP: He is -- he is not a sellout. And I think having President Trump just because he's the president come speak on his behalf or eulogize him or memorialize him would be selling out.

And Senator McCain -- I say that not just as his daughter's best friend but as a Republican who supported him, Senator McCain is everything that President Trump is not in every way that you discussed and every way you can imagine. And so in these -- in these final hours, in these final days, weeks, we hope months --

TAPPER: We hope years.

SOLIS DOYLE: We hope years.

CUPP: We sure do -- you know, he is -- he is having those very real thoughts and conversations with friends and family. Friends like Lindsey Graham and Joe Lieberman, people that have been around him for a really long time and making the best decisions for him and his family.

TAPPER: It's tough to talk about it. Senator McCain, we are all pulling for you here and we're all thinking about you.

President Trump seems to have a special knack for getting a glowing medical report but he has been having a little trouble with his physicians as of late.

So what exactly are the criteria for treating the "healthiest individual ever elected to the presidency" -- quote -- unquote.

That's the subject of this week's "State of the Cartoonion."

(COMMERCIAL BREAK)

[09:58:43]

TAPPER: Welcome back.

President Trump seems to have an issue with his doctors. That's the subject of this week's "State of the Cartoonion."

(BEGIN VIDEOTAPE)

TAPPER (voice-over): This week President Trump's former personal doctor said his office had been robbed -- by a White House aide and others looking for the president's medical files.

HAROLD BORNSTEIN, PRESIDENT TRUMP'S FORMER DOCTOR: All his medical records, just pictures, anything they could find. They must have been here for 25 to 30 minutes.

TAPPER: The White House claims this was all standard procedure but it got us wondering what exactly does the president look for when choosing a medical professional.

Is it a physician with a lose understanding of doctor-patient confidentiality?

BORNSTEIN: It certainly is not a breach of medical trust to tell somebody they take Propecia to grow their hair. What's the matter with that?

TRUMP: Look at the beautiful head of hair in that guy (ph)

TAPPER: Or an M.D. who's skilled at taking dictation perhaps?

Quote -- "The healthiest individual ever elected to the presidency."

TRUMP: My health has been very good and very strong.

TAPPER: Or maybe the president's top medical criteria is just a doctor who shares the billionaire's superlative opinion of his own physical specimen.

RONNY JACKSON, WHITE HOUSE PHYSICIAN: It's called genetics. I don't know. Some people have, you know, just great genes. He might live to be 200 years old. I don't know. TAPPER: After all, when it comes to medical opinions, President Trump certainly had no problem playing doctor for his political opponent Hillary Clinton.

[10:00:08]

TRUMP: Hillary Clinton does not have the stamina, does not have the energy, doesn't have it. Doesn't have the strength to be president.

(END VIDEOTAPE)

TAPPER: Thanks for joining us.

"FAREED ZAKARIA GPS" starts right now.