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INSIDE POLITICS

Mueller Offers to Reduce Questions; Gates to Testify; White House Ignoring Trial. Aired 12-12:30p ET

Aired August 2, 2018 - 12:00   ET

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


[12:00:00] KATE BOLDUAN, CNN ANCHOR: Starts right now.

NIA-MALIKA HENDERSON, CNN ANCHOR: Thanks, Kate.

Welcome to INSIDE POLITICS. I'm Nia-Malika Henderson. John King has the day off.

A new offer to team Trump to sit down with the special counsel. Does the president think he can convince prosecutors their own case really is a witch hunt, as he likes to say?

Plus, it's day three of Paul Manafort's trial, and the prosecution is already playing cleanup over their would-be star witness.

Meanwhile, on Capitol Hill, Republican senators worried about keeping their majority are grappling with the president's threats of a shutdown and a battle with Democrats over the Supreme Court nominee. And Senator Hatch, he is so over it.

(BEGIN VIDEO CLIP)

SEN. ORRIN HATCH (R), UTAH: And I want to really compliment the Democrats who have stood up and are willing to stand up for Judge Kavanaugh because they realize that we can't keep going down this partisan, picky, stupid, dumb ass role that -- that has happened around here for so long. And I'm sick and tired of it, to be honest with you.

(END VIDEO CLIP)

HENDERSON: We begin with the White House struggling to find middle ground with the special counsel's investigation and struggling with how to contain or just frame the president's very public frustration with the entire process. In about an hour, the White House will have another chance to weigh in at a press briefing. And we'll bring that to you live when it happens.

Sources tell CNN that Robert Mueller's office has offered up some concessions for a potential interview with President Trump. Those sources say that Mueller is willing to trim down his list of obstruction-related questions for the president, but that he insists on asking those questions in person. Mueller apparently not biting after the president's team suggested he provide written answers. Now, this comes, of course, in the middle of a sudden, intense

escalation in the president's attacks on the special counsel. CNN has learned that the president's public fury came mere hours after his lawyers updated him on the latest in their negotiations.

CNN's Kaitlan Collins is following this story from the White House.

Kaitlan, we'll hear from Sarah Sanders later today. She'll answer some questions about these very public negotiations. What do we expect to hear from her today?

KAITLAN COLLINS, CNN WHITE HOUSE CORRESPONDENT: Well, Nia, she could shed some insight into exactly what it is that the president's mindset on this interview is. We know that on his Twitter feed he's lashing out at the special counsel, but his legal team is very much involved in these negotiations. Negotiations they have been involved in for eight months now.

Now, the debate is over these questions about obstruction. That's not new. We knew the special counsel wanted to ask about that. But, Nia, the question now is how is the president going to be asked about that? Will it be in person or will it be on paper? The latest proposal from the special counsel includes questions about obstruction, which he says he will limit, but he says he does want to ask those questions in person in a sit-down with the president.

Now, on the other side, we know the president's legal team, their latest proposal included allowing questions about obstruction to be asked but only to be answered in written form while the questions of the president would be asked in person would have to deal with events that happened before he was inaugurated as the president. That would means those events would center around collusion and those questions and not on the ones about obstruction in person.

Now, all of that is going on while the president is lashing out on Twitter. The White House is still trying to explain that tweet where he said that his attorney general should shut down the special counsel's investigation. But we know that that comes because the president believes he can sway public opinion into agreeing with him that this is all just one big witch hunt. The White House is going to have to answer questions about that when Sarah Sanders does come out here. And we'll see if she sheds any light on those negotiations, but she'll likely just refer back to the president's lawyer, Rudy Giuliani.

HENDERSON: And that will happen today around 1:00. And we'll bring it to you live.

Thanks, Kaitlan.

Here with me to share their reporting and their insights, we've got "Bloomberg's" Margaret Talev, Rachael Bade with "Politico," Matt Viser with "The Boston Globe," and CNN's Abby Phillip.

Thank you all for being here. I want to really start with what seems to be at this point a stalemate between the president's team and Mueller's team over this question of what questions he answers in written form, what questions he answers in person. Why do we think the White House is so adamant that the obstruction question should only be written? What are they nervous about in terms of the obstruction line of questioning, Margaret?

MARGARET TALEV, SENIOR WHITE HOUSE CORRESPONDENT, "BLOOMBERG": Well, they're just concerned about putting the president before Mr. Mueller or his team for an interview because, as we all know in a less legal, more public setting, if you think the president is going to talk for five minutes, he could end up talking for an hour and a half, and you could learn things that you never knew would even come up. So it's partly a matter of strategically of just trying to sort of contain the president, you know, from himself.

[12:05:05] But, look, they're -- the president and the White House are trying to navigate two parallel tracks here, and one is their -- how they deal with Mueller and the other is how they deal with the court of public opinion. So they know there are several plays that Mueller and his team could do. Mueller could try to subpoena the president. This could go all the way to the Supreme Court. If that happens, at least in a public relations setting, it's much better for the president to have been arguing all along, I've always wanted to talk to Mueller. It was my team that was trying to hold me back, or it was a matter of being fair about the questioning. If the president comes at it from a posture of, no way, I don't want to talk to those guys, I'm worried about talking to those guys, at least in the public court of opinion it hurts him, and possibly from a legal setting it hurts him.

HENDERSON: And one of the people in the public court of opinion, and trying to shape it, is Rudy Giuliani. And he keeps saying, this thing needs to wrap up soon. Here is the latest from Rudy Giuliani.

(BEGIN VIDEO CLIP)

RUDY GIULIANI, PRESIDENT TRUMP'S LAWYER: We believe that the investigation should be brought to a close. We think they're at the end of it. They should render their report, put up -- I mean, I guess if we were playing poker, we're not, we'd say put up or shut up. What have you got? We have every reason to believe they don't have anything. The president didn't do anything wrong. I don't think they have any evidence he did anything wrong.

(END VIDEO CLIP)

HENDERSON: And you hear other Republicans echoing that same sentiment, Abby.

ABBY PHILLIP, CNN WHITE HOUSE CORRESPONDENT: The pressure is definitely increasing, both personally on Rudy Giuliani, who came on to the legal team under the premise that he would try to get this to wrap up more quickly, and it seems like he hasn't been able to do that, but also from the president's allies on the outside. You're hearing a lot of voices saying to the president, you need to end this now. Get Jeff Sessions to end this now. Get Rod Rosenstein to end this now.

That's not by accident. It seems to be in part because there's more concern that this investigation is becoming more damaging. Both the combination of the Michael Cohen revelations and also the fact that Mueller is still going, it's causing a lot of people around the president to worry. And they're also worried about the midterms. They're worried that Mueller might drop something before the midterm elections that could be devastating to Republicans.

HENDERSON: And Trump also seems to believe that possibly if he talks it could bring this investigation to an end more quickly, but there's not necessarily any evidence of that, Matt.

MATT VISER, DEPUTY WASHINGTON BUREAU CHIEF, "THE BOSTON GLOBE": Yes. I mean it's interesting the way that Trump seems to think that he could charm Mueller --

HENDERSON: Right.

VISER: The way that he thinks he's done with Kim Jong-un and with other world leaders. If he gets in the room, he can win them over. This is, of course, a very different situation.

The other thing that is interesting where Giuliani is saying put up or shut up, the irony in that is that Bob Mueller is perhaps the only person who we haven't heard from, you know?

HENDERSON: Right. Yes.

VISER: He --

HENDERSON: Yes, yes, yes, he has shut up. Right.

VISER: He never speaks. He speaks through indictments, which he's had a lot of. He speaks through his court filings. But he doesn't talk himself. And so you have Giuliani out there talking a lot. You have President Trump talking a lot. You have Michael Avenatti --

HENDERSON: Right.

VISER: In the other case and --

HENDERSON: Lanny Davis.

VISER: Lanny Davis. And you have a lot of these lawyers talking, but Bob Mueller himself is relatively silent, which his supporters may want to hear more from him given the way that his opinion numbers have taken a dive. But he is -- he is sort of, you know, the epitome of, you know, talk softly and carry a big stick. You know, he's doing that a lot right now. And we're seeing his actions but not his words.

HENDERSON: And, Rachael, yesterday we saw the president, right, lashing out and his reaction to this and this whole idea of whether or not his tweet was a directive or an opinion or just a suggestion or him blowing off steam. And, of course, the White House, we're going to play a clip of all the ways that the White House has talked about the president's tweets and whether or not they're opinion or directives. Here you go.

(BEGIN VIDEO CLIP)

SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: It's not an order. It's the president's opinion. The president is stating his opinion. He's stating it clearly. There's no reason he shouldn't be able to voice that opinion.

UNIDENTIFIED MALE: So should the attorney general see this as a directive, or as an opinion?

RUDY GIULIANI, PRESIDENT TRUMP'S ATTORNEY: No, it isn't. It isn't at all. It's what it is, is that we said immediately it's an opinion. And he used his -- he used a medium that he uses for opinions.

UNIDENTIFIED MALE: Policies are statements and statements are policies. It goes both ways.

MIKE POMPEO, SECRETARY OF STATE: No, that's not true. That's absolutely not true. People make lots -- I make lots of statements. They're not -- they're not U.S. policy.

I misspoke. It is the case.

UNIDENTIFIED MALE: OK. All right.

POMPEO: The president calls the ball. His statements are, in fact, policy.

SEAN SPICER, FORMER WHITE HOUSE PRESS SECRETARY: The president is the president of the United States, so they're considered official statements by the president of the United States.

(END VIDEO CLIP)

HENDERSON: Pompeo there switching it up in the same conversation there.

RACHAEL BADE, CONGRESSIONAL REPORTER, "POLITICO": Yes. But, yes, to go back to the president's tweet yesterday, it's got to be the toughest job in Washington, speaking for the president and also being his lawyer. Yes, they're arguing that he said Mueller should end the probe, not he must end the probe, and that that's a difference. He's just expressing his opinion.

But, look, if the president of the United States says something should end and you work for the president of the United States, you see that. And you've got to be nervous about it, right? Of course, the FBI, they're going to do their job. They're trying to tune this out and they just want to get this done with.

But going back also to the obstruction of justice and why he doesn't want to answer questions or why his lawyers do not want to answer questions on this, there's a lot of thinking out there that Mueller might have a more solid case on obstruction than he does on the Russia interference thing. And so they don't want the president to talk about this. But, again, Trump and his tweeting, and he just wants to go out there and put it all out there. This could be a real legal danger to him.

[12:10:16] PHILLIP: And obstruction deals with state of mind.

HENDERSON: Right. Right.

PHILLIP: And that's one of the biggest problems for the president's lawyers is that it's about, what were you thinking when you did, not, what happened when. And I think that's why it's tricky for him because That's when you open up the president to saying all kinds of things that you may not have wanted him to say. When he sat down with Lester Holt, he basically started that process by saying, when I fired Comey, I was thinking about the Russia investigation.

BADE: Right.

PHILLIP: That's a big red flag for his legal team.

TALEV: But when it comes to something like yesterday, again, this is about the court of public opinion. President Trump understands news cycles. I think we can all agree to that. It was the first full day of testimony in Paul Manafort's trial. If the president had not stepped in and created his own side story, all of the coverage that day about the Russia probe would have been about Manafort and the trial. Instead, everybody knows the top four paragraphs of every story became, President Trump on the offensive on Twitter.

HENDERSON: And do we expect more of that? I mean I know it's hard to predict (INAUDIBLE), but that that going to be sort of a daily thing?

(CROSS TALK)

BADE: Daily. Daily.

VISER: It also -- they would have stronger ground to stand on if he did only use it for opinion. He uses his Twitter feed to fire people, to announce policy. It's a real-time look into his mindset on things.

HENDERSON: His mindset, yes.

VISER: And so it's not like he's only using it for his opinion. So, I mean, I think that his team is doing all that they can to turn this into a semantics argument --

HENDERSON: Than to clean it up, yes.

VISER: Rather than, you know, what it is.

HENDERSON: Yes. We'll have to leave it there.

But before we go to break, some major news on Wall Street. Apple just became the first American public company to reach $1 trillion in value. Apple shares surged to an all-time high just moments ago after the company reported better than expected earnings this week. For context, Amazon clocks in at about $900 billion. Google and Microsoft both worth more than $800 billion.

We'll be right back.

(COMMERCIAL BREAK)

[12:16:07] HENDERSON: Welcome back.

As the trial of former Trump campaign chairman Paul Manafort enters its third day, there are questions over the fate of Manafort's long- time business partner turned witness for the prosecution, Rick Gates. Prosecutors caused a major stir yesterday when they appeared to suggest that Gates might not actually be called to testify despite his central role in the case. But this morning prosecutors walked that back entirely, now saying they fully intend for Gates to testify, possibly as early as tomorrow.

CNN's Shimon Prokupecz, he joins us today.

You've been following this case.

Shimon, what happened yesterday that they were essentially saying this might not happen, and now today it's on?

SHIMON PROKUPECZ, CNN CRIME AND JUSTICE REPORTER: Yes, it was during testimony from one of the witnesses where the prosecutors were asking questions related to Rick Gates. And I think in an effort to move thing along --

HENDERSON: Right.

PROKUPECZ: The judge said, well, you're going to have Rick Gates here testifying, so why don't we just move along here and when Rick Gates comes in, you can ask him these questions. And the prosecutor, I think, without thinking, just quickly said, well, we may not or we may or may not call him. And certainly that signaled to a lot of the reporters in the room, well, whoa, this is the first time we're hearing that Gates may not be coming in.

And then, as you said this morning, I think seeing some of the news reports, the prosecutors came in and wanted to make it very clear to the judge and to the defense team, yes, we do intend to call Rick Gates. And that could happen, as you said, tomorrow. As early as tomorrow or Monday.

HENDERSON: Yes. And Gates, of course, had come under some pretty withering criticism in this idea that he might not be such a reliable witness.

PROKUPECZ: Yes, certainly I think that's what the defense wanted.

HENDERSON: Right.

PROKUPECZ: They seemed to -- this -- he seems to be key to their defense. They're blaming everything on him. They've said as much in the opening statement.

So there was some also thinking that because of that, maybe the prosecutors wouldn't call him.

HENDERSON: Right.

PROKUPECZ: But it's clear that they're going to stick with their guy and they intend to bring him before court and we'll see what he says.

HENDERSON: And as we watch this trial, we're also, of course, watching Trump's reaction to the trial. We saw it yesterday.

One of the things that's interesting, and "Politico" has this report, in terms of the White House's talking points and having people talk about this trial, and this is what they found. More than a half dozen of Trump's most vocal TV surrogates told ""Politico that they weren't provided White House or campaign talking points on the case, as is customary for important headline generating matters. Some interpreted that as an attempt to keep them from talking about the trial on TV and to starve it of oxygen.

Donald Trump did not get that message. He is not starving it of oxygen. He is providing some oxygen. There seemed to be sort of a -- from the White House, you know, Paul mana-who, like he didn't really, you know, work for the campaign at all. And Trump obviously having a different perspective.

PHILLIP: Well, there's also another explanation, which is that they don't have their act together to come up with talking points to send out to their surrogates. In this White House, that's a real possibility. I think this idea that there's a grand plan around this Manafort trial is not quite right because they have settled on, as close to something, which is basically, this has nothing to do with us. But that's not a fully baked, you know, plan here.

HENDERSON: Right.

PHILLIP: It's fairly limited in its scope. And, obviously, the president is undermining that every day that he talks about it. So this is the White House still trying to figure out exactly where to position themselves on this. And as many people have pointed out, the Manafort trial is being handled by the special counsel. And as much as they say this has nothing to do with his time as campaign chairman, there is a fear that there is something that they don't know about that could come back to haunt them. They don't know what that is.

HENDERSON: And one of the things that's coming out in this Manafort trial, his lavish expenditures and his extravagant lifestyle. Thirty- plus bank accounts in three countries. Who among us doesn't have 30- plus bank accounts in three countries? Seven homes, 6 million on luxury items and services, 3 million in home improvements, $900,000 at a men's clothing store, $123,000 car, and the jackets, of course, $18,000 on a python jacket and $15,000 on an ostrich jacket. I think there's also some sort of vest that goes with it, because you've got to have the vests to go with it.

[12:20:14] PROKUPECZ: Yes, which is -- right.

I mean it's just some of the fun, I guess, in this trial. But here's the importance in this, is this is how the prosecutors are showing that he was living this lavish lifestyle. He was using money, overseas money, money that he had parked in these overseas accounts, and then was wire transferring a lot of this money to these vendors, to these -- this suit guy, the guy who was making his suits. So that's what the prosecutors are using this for. You know, the judge has taken some issue with them showing these photos.

The other thing I think important in terms of the president. I think when we hear Rick -- from Rick Gates, it's going to be interesting to see how the president reacts to that, right? He worked on the campaign. We know how the president feels about disloyal people. The idea that Rick Gates is cooperating, flipped.

HENDERSON: Right.

PROKUPECZ: We don't know exactly everything Rick Gates is providing to prosecutors. I bet the Manafort stuff is just a small part of the bigger picture of what the special counsel is doing.

TALEV: But the reason why all of this is important, I mean the ostrich clothes or whatever, it's like a shiny object. But the reason why this is important and interesting is because Paul Manafort had long- standing, well-established roots to the Russians, the pro-Russian Ukraine leadership at the time, deep ties to that world. And when the question is like, how did the Russians get anywhere close to Donald Trump or the campaign? We know the answer. And this establishes the answer. Between Rick Gates' relationships and Paul Manafort's relationships, that is the first nexus, and it is sort of proven again and again and again, at least with some of the, you know, alleged, you know, financial ties that they're trying to bear out. The question for -- the question for --

HENDERSON: And that's what they'll get at today with questioning --

TALEV: Yes, And the question for the president and the president's family and some of their top aides is, did that kind of jump to the next level? Did that ever move out of Manafort and Rick Gates' world into Trump land? But we know it's in Manafort's world and that's kind of the establishing basis of a lot of these relationships. It's important.

HENDERSON: Gates, that will be a banner day when he testifies. Another thing that came up in court today was whether or not Paul Manafort would testify. And we'll just have to wait and see.

PROKUPECZ: We're nowhere close to that.

HENDERSON: Yes.

Up next, an endorsement from President Trump is highly coveted these days, but does it pay off at the polls? One candidate says, absolutely.

(BEGIN VIDEO CLIP)

REP. LOU BARLETTA (R), PENNSYLVANIA SENATE CANDIDATE: Well, it's a game changer here in Pennsylvania. You know, President Trump is more popular here today than when he won in 2016.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

[12:27:19] HENDERSON: As endorser in chief, President Trump is very much on a roll. Most of the midterm candidates he's backed this year have won their respective primaries. These are just a few of them, and he's keeping his foot on the gas for Republicans in several other states. He was in Florida on Tuesday pushing Congressman Ron DeSantis for governor. He'll be in Pennsylvania later today stumping for Congressman Lou Barletta in that Senate race. And Saturday in central Ohio campaigning for a state senator who is running for Congress.

But the president's endorsements haven't always worked. His guy, of course, lost in that Pennsylvania special election back in March. And, remember, he backed Luther Strange and then Roy Moore in Alabama, both of them lost. But the president is clearly reveling in this string of winning endorsements.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: My polls are great. But the question is, is it transferable? Now, it certainly was with Florida, because you saw Ron DeSantis, who's gotten a tremendous -- you know, many, many, many points. The governor of Georgia, where he was down by five and he won by 40 after I endorsed him. That was pretty good. That was good. If you take a look at the congressman, Donovan, from Staten Island, where he's down by 10 and he wins by 24. So we've had a lot of impact. And that's why I'm going around.

(END VIDEO CLIP)

HENDERSON: Man, he's clearly enjoying this. And, you know, kind of looking at the polls and in the weeds on this. The value of his endorsement seems to have gone up. And he wants to do more.

VISER: Yes. And part -- I mean he doesn't name Brian Kemp in there, who's running for governor in Georgia.

HENDERSON: Right.

VISER: You know, so the lack of familiarity sometimes with these candidates is kind of interesting.

HENDERSON: Yes.

VISER: Where -- and he's not -- it's not like he's ushering in ideologues. You know, he's not backing people because of their ideology often. He's backing them because they like him. You know, he's ushering in a new group of people who really like Donald Trump. You see that with Ron DeSantis and some of his ads in Florida. Brian Kemp did the same in Georgia. Lou Barletta in Pennsylvania. Like, they're really hugging close to Trump.

And that does -- you know, it's part of the enduring parts of his presidency is the support that he still has within that base of the Republican Party and they're all, you know, clinging to him in ads, which is unusual at this time of year --

HENDERSON: Yes.

VISER: For people to be clinging to an incumbent president ahead of a midterm cycle that typically is not very good for an incumbent.

HENDERSON: Rachael, is there any other more method to what he's doing, other than if the guy likes Trump, he's going to get out there and endorse him?

BADE: It's all about loyalty. I would say almost 100 percent. And, of course, party leaders will obviously ask the president to back someone they're worried about, which they're going in Ohio right now. But most of these guys that he's backing have done something for the president. Ron DeSantis, who's polling ahead in his run for governor, because of Trump, has been on TV time and time again blasting the Russia investigation, defending the president, saying this is all a witch hunt.

[12:30:12] You talk about Lou Barletta. I remember when he was