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Interview with Rep. Adam Schiff; Ivanka Trump & Jared Kushner Earnings Raise Ethical Questions; Trump Declares North Korea Summit a Success Despite the Country's History; Trump Shows Kim Movie Trailer Showing Booming North Korea; Trump Chief Economic Advisor Larry Kudlow Hospitalized after Heart Attack; Trump Trade Advisor Peter Navarro Changes Tune on Canada's PM. Aired 1:30-2p ET

Aired June 12, 2018 - 13:30   ET

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

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[13:30:22] WOLF BLITZER, CNN HOST: Right now, we're getting an inside look at the vast wealth of President Trump's daughter and son- in-law, who also serves as two of his top advisers. It's raising some ethical questions. New documents how Ivanka Trump and her husband, Jared Kushner, earned $82 million in outside income last year while serving in the White House. Ivanka Trump bringing in earnings from the trust that oversees her clothing line, the Trump International Hotel in Washington, and severance from the Trump Organization, to name a few. Jared Kushner mainly brining money from his real estate empire along with other investments.

Joining us now, the ranking member, once again, of the House Intelligence Committee, Adam Schiff.

Any ethical concerns here or legal concerns from your perspective?

REP. ADAM SCHIFF, (D), CALIFORNIA: Both ethical and legal. Certainly, if this information is derived from foreign services that are violating the Emoluments Clause, that's a serious problem. One of the issues we have now is, with the Republican majority in Congress unwilling to do any oversight of this, we simply don't know if the foreign policy of the United States is up for sale. There are a lot of allegations about the Kushners trying to get money from the gulf nations. Was that influencing the policy of the United States, vis a vis, Saudi Arabia, or antagonism towards Qatar. We don't know and we shouldn't have to ask these questions. That's why, in the past, presidents have divested themselves. In this case, the first family, which has an important policy role in this administration, has not divested, not fully. We have to wonder is Ivanka getting trademarks from China for some reason? The Chinese investment of half a billion dollars in a Trump-branded property in Indonesia, did that influence the president's decision to reverse sanctions on ZTE? We shouldn't have to wonder. But with this majority in Congress unwilling to do oversight and with the first family unwilling to divest, we are left to question whether the policy is driven by their financial interests and not the interests of our country.

BLITZER: Who is looking into this? The Republican majority, you're saying, in the House of Representatives not interested, right? SCHIFF: Not interested. It should be done by the Government Reform

Committee and Trey Gowdy, but it's not. They're unwilling to look into anything that might either embarrass the president, reveal wrongdoing by the administration, and that leaves the country in jeopardy.

BLITZER: You're saying that would change if Democrats were the majority after the midterm elections?

SCHIFF: Absolutely. We would be back to governing as well and back to a very different policy. But importantly, we'd also be doing oversight again and making sure the country is being run for the benefit of its citizens and not for the benefit of Donald Trump or Ivanka or Jared Kushner or anyone else in the family.

BLITZER: Congressman Schiff, thank you for joining us.

SCHIFF: Thanks, Wolf.

BLITZER: Condos on the beach. That was part of the president's pitch to Kim Jong-Un in a rather surreal video he showed the leader of North Korea. We're going to play it for you.

And the trade adviser who said there's a special place in hell for Canada's Prime Minister Justin Trudeau, that trade adviser to President Trump is now changing his tune. What Peter Navarro just said about those very controversial remarks.

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[13:37:53] BLITZER: President Trump is declaring his summit with the North Korean leader, Kim Jong-Un, a success. The two leaders signed a document in which Kim reconfirmed his commitment to denuclearize the Korean peninsula and the U.S. agreed to supply security guarantees. The agreement lacked specifics but that doesn't seem to worry President Trump. Listen to this.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I do trust him, yes. He trusts me, I believe. I really do. He said openly, and he said it to a couple of reporters that were with him that he knows, that no other president ever could have done this. I mean, no other president. He knows the presidents. He knows who we had in front of me. He said no other president could have done this. I think he trusts me and I trust him.

(END VIDEO CLIP)

BLITZER: Significant words. But North Korea is a country with a notoriously poor track record on previous agreements. Over the years, similar promises were made to eliminate its nuclear weapons but never fulfilled. There you can see some of those agreements.

Let's discuss this with our panel, the former senior adviser at the U.S. State Department, Balbina Hwang, William Cohen, who served as the defense secretary under President Bill Clinton, and CNN chief political analyst, Gloria Borger.

Is this time different, Gloria?

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Who knows? We have no idea. What we know is that the president offered a concession and Kim Jong-Un offered an intention. I don't think it went beyond that at all. And we'll have to see what happens in the follow-up with the secretary of state and Secretary Mattis who, by the way, we haven't heard from.

And your former secretary of defense, when you talk about war games being provocative and stopping what is really readiness, I'm wondering where Secretary Mattis is on all of that.

BLITZER: You're a former defense secretary. The president announced suspension of the joint military exercises that have been going on with South Korea for decades. He said they were provocative, they were costly. He also raised the possibility of withdrawing those nearly 30,000 U.S. troops from South Korea. He never liked them there to begin with.

[13:39:58] WILLIAM COHEN, FORMER SECRETARY OF DEFENSE: Do you know what's more costly than training and exercising? That's going into a war unprepared and ill prepared. If you go back to the Korean conflict, you see what happened when we put men into that conflict that they were poorly equipped, poorly trained, and we suffered massive casualties. So the notion that these are expensive, yes. Being prepared to fight the wars you cannot deter is very expensive. It's less expensive than losing people in a war, less expensive than losing a battle in a war. So the notion that he's putting a price tag on exercising. What would the Golden State Warriors do without exercising for a whole season, and the coach said, OK, we know we're good, we'll just go in there and play now like we always could. It's absurd, the notion you would not exercise and make yourself as ready as possible to deter anyone taking action against you.

BLITZER: The president heaps a lot of praise on Kim Jong-Un.

Balbina, you're an expert on the Korean peninsula. You worked at the State Department. Listen to this.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We have developed a very special bond.

He is very talented.

GEORGE STEPHANOPOULOS, ABC NEWS ANCHOR: You trust him?

TRUMP: I do trust him, yes.

He's got a great personality. He's a funny guy, he's a very smart guy. He's a great negotiator. He loves his people, not that I'm surprised by that, but he loves his people.

(END VIDEO CLIP)

BLITZER: What do you think?

BALBINA HWANG, FORMER SENIOR ADVISER, U.S. STATE DEPARTMENT: Well, let's just put this in perspective. I think we just crossed a line. What we did was make a complete strategic shift. This is no longer about the nuclear issue. What we've done is made a complete strategic shift in the entire -- not just the Korean peninsula, not just in the region, but globally. What we've done is say -- raised questions about not just the alliances, but in terms of who our enemies are, how we're going to address our friends, our allies, everybody in the region. And how we talk to everybody. Our neighbors, our friends, and this is within the context of our G-7 summit just, what, 36 hours ago? And now how President Trump is going to address everybody, including our -- somebody that we're technically at war with.

BLITZER: We're you surprised -- let me get to the secretary. Were you surprised by his praise of the North Korean leader, given what the president himself said about a year ago when he addressed the U.N. General Assembly and spoke about what's going on as far as human rights are concerned in North Korea?

COHEN: We know that he loves to be flattered and praised and perhaps he felt that if I flatter and praise Kim, I'll get a better deal.

But I want to go back to the issue you just raised. Look at what is taking place globally. We are disengaging. The president has said he wants our troops out of Korea. He eventually will say we need to get our troops out of Japan. So at that particular point, you can say the Chinese will be very happy with this, the Russians are very happy with this. But all our allies in the region, number one, they were disappointed, dismayed that he pulled out of the Trans-Atlantic Partnership, so disengagement. Now will he pull our troops out at some point sooner than later? That, I think, says you're on your own. You can't count on the United States. We've already told that to NATO. The NATO countries have been -- disengaging them, picking on them, saying you're not paying enough, you won't get our support if there's a campaign. So this is a policy he's deliberately following of disengaging. And the cover of "The Economist" magazine had it just right, he's swinging childlike on a wrecking ball to all of the institutions that have preserved peace and stability for the past 70 years.

BORGER: And did he tell the South Koreans? There are reports that he did not. The A.P. has reported this, that he did not tell them in advance that he was going to stop these military exercises. And they're all worried, of course, is this the slippery slope we're on right now, to disengaging from the peninsula, as you point out? And our allies are scratching their heads because Kim Jong-Un seemed to have gotten a lot better treatment than they did.

(CROSSTALK)

BORGER: And by the way, Wolf, this makes it clear, the way he talks about Kim Jong-Un, that they have been talking to each other privately. I don't think this was just like the first time that they actually spoke. And I think we've got to do more reporting on that, but there are whispers about the fact that these two have been communicating privately.

HWANG: But this does raise a very important question, and this is whether this is all about President Trump on the wrecking ball doing this all by himself or whether there's a very significant shift going on in the globe. And whether or not it really is true that President Trump did this by himself and didn't talk to the South Koreans, or whether or not there is, as I said, something very significant going on, and whether or not this is actually happening in Asia, and this is actually the first Koreas for the first time doing something independently. Something happened on April 17th between the two Koreas. When those two Korean leaders stepped over the line together with their hands held, that was the first time the two Koreas did something independently, together. And they were taking action. And I think the two Koreas are leading the charge. So this may be something significant in Asia. China is now an important actor. And China is leading the charge. India is becoming increasingly important. And the United States may be withdrawing from the world.

[13:45:29] BLITZER: We shouldn't be all that surprised that the president wants to withdraw U.S. military forces from South Korea or Japan or Germany, for that matter, because, for years, he's been saying, why is the U.S. spending all this money deploying troops over there. They should be here. Let those countries take care of themselves. They don't need the U.S. He's told that to me for years. He's told it to a lot of other journalists over the years.

COHEN: Contrary to a sound military doctrine, you try to defend your perimeter as far and as wide as you can to protect your homeland. We are there in Japan, we are in Korea, we are in Europe. We're there to protect our core interests. The further out we can get and have allies who work with us to defend their interests, plus outs, the better. So he's narrowing it back to the continental United States.

BLITZER: Quickly, Gloria, we did see the president at his news conference say -- and they released it -- he showed a video to the North Korean leader on his iPad showing what North Korea could be like if they would give peace a chance, denuclearize the Korean peninsula. They'r3e smart people, he said. They would have all the opportunities to have a booming economy like South Korea if they took advantage of this rare opportunity with him.

BORGER: I watched this video, and I watched it, obviously, in English, and it really was an appeal to ego. It was an appeal to the ego of two men, of Donald Trump and Kim Jong-Un, saying this is our moment where we can change the world. Not just make a difference. We can change the world and we can go down in history as two men who have changed the world. And I think, obviously, we know that would appeal to Donald Trump but they also knew it would appeal to Kim Jong-Un.

BLITZER: By the way, we're getting in a statement from the parents of Otto Warmbier. He was the University of Virginia student who was taken prisoner in North Korea, came back on his deathbed, died within a day or two after returning to the United States. Here's a statement from the family of Otto Warmbier: "We appreciate President Trump's recent comments about our family. We are proud of Otto and miss him. Hopefully, something positive can come from this."

The president said he hopes something positive will, in fact, come from the death of Otto Warmbier.

Guys, thank you so much. Good discussion.

Other news we're following, President Trump's trade adviser says there's, quote, "a special place in hell for the Canadian Prime Minister Justin Trudeau." He's weighing in once again. You're going to hear what he's saying today about that comment, when we come back.

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[13:52:32] BLITZER: Right now, President Trump's chief economic adviser, Larry Kudlow, is in the hospital here in the Washington, D.C., area after suffering a heart attack. Kudlow had just returned from the G-7 summit in Canada.

Let's bring in CNN senior economics analyst, former Trump economic adviser, Stephen Moore.

I know you're friendly with Larry Kudlow, used to be an anchor, a host and commentator at CNBC for a long time. All of a sudden, he has what the White House now says was a mild heart attack. He's at the Walter Reed medical facility outside Washington in Bethesda.

You've spoken to him. How's he doing?

STEPHEN MOORE, CNN SENIOR ECONOMIC ANALYST: By the way, he's a little more than a friend of mine. He was the best man at my wedding.

(CROSSTALK)

BLITZER: He's a very good friend.

MOORE: I almost did have a cardiac arrest when I heard the news last night. Thankfully, it sounds like it was a minor heart attack. I talked to his assistants who are with him all the time and they say he's doing well. I expect him, Wolf, to be back on the job in a week or so.

Look, Donald Trump is a hard guy to keep up with. Donald Trump is a freak of nature. He works 20 hours a day, and is, you know, it's a grinding schedule. As you know, he's with Donald Trump all the time, Larry is. You see John Bolton on one side and Larry on the other. But he'll be back on the job and ready to go.

BLITZER: But he's got to take it easy a bit, even a mild heart attack.

(CROSSTALK)

BLITZER: That pace, being top economic advisor to the president. As you correctly point out, that's a strenuous job.

MOORE: That's right. He's got a big staff. The one thing that he'll have do that's going to be a hard lifestyle change for him is to stop smoking.

(CROSSTALK)

BLITZER: He still smokes?

MOORE: He's a smoker. But we tried to get him to stop and I think now he will.

(CROSSTALK)

BLITZER: Well, I hope he stops smoking.

MOORE: He's had a phenomenal record. Trump really listens to him on economics, which is good. He helped write the tax cut. Larry and I served together as senior advisors to the campaign, so. You look at the deregulation, the tax cut. And the one thing I think even -- the one impact that Larry had, which kind of got buried in the summit, the G-7 meeting, was he said basically said, why don't we move to zero tariffs with Europe and Canada, which was an interesting proposal. We'll see what happens.

(CROSSTALK)

BLITZER: I've known Larry Kudlow, too. He's a very nice guy. Whether you agree with him or disagree

(CROSSTALK)

BLITZER: We're hoping and praying only for the best. A complete recovery, let's hope. I know you're going to be seeing him later.

As you know, there's another advisor, trade adviser, Peter Navarro, who said some awful words about the prime minister of Canada following the G-7. He suggested there's "a special place in hell," his words, for Prime Minister Trudeau. Today, he apologized, he walked that back, which is the right thing to do.

MOORE: Sure.

BLITZER: Listen to what he said today.

(BEGIN VIDEO CLIP)

[13:55:16] PETER NAVARRO, TRADE ADVISOR TO PRESIDENT TRUMP: In conveying that message, I used language that was inappropriate --

(CROSSTALK)

UNIDENTIFIED MALE: A special place in hell for the prime minister.

NAVARRO: Basically, lost the power of that message. I own that. That was my mistake. Those were my words.

(END VIDEO CLIP)

BLITZER: Yes, he really went off the cliff with that awful statement. (CROSSTALK)

BLITZER: Canada is one of our closest allies, Prime Minister Trudeau. What he said certainly did not deserve a place in hell.

MOORE: That's absolutely true.

(CROSSTALK)

BLITZER: He did the right thing by apologizing.

MOORE: Of course. Look, the White House was very upset with Trudeau with the statement he made. But that kind of language is not -- I don't like, the American people, and I don't like the name calling that goes back and forth. That's not diplomacy.

BLITZER: I hope he learned his lesson and others have learned his lesson on this as well.

MOORE: Look, I've put my foot in my mouth --

(CROSSTALK)

BLITZER: But you're not a senior adviser to the president right now. You're a private citizen.

Thank you very much for that.

The former President Bill Clinton once again getting backlash for new comments he made about the "Me Too" movement. We'll discuss that.

Much more news right after this.

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