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HALA GORANI TONIGHT

Trump Says the Money to Daniels Did Not Come Out of The Campaign; Trump May Face Legal Action as Sitting President; Dershowitz Says Breaking Campaign Finance Laws Is Like Jaywalking; Two Verdicts Occurred in The Same Hour and Rocked the Trump Presidency. Aired 3-4p ET

Aired August 22, 2018 - 15:00   ET

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


[15:00:00] HALA GORANI, CNN HOST: Hello and welcome. I am Hala Gorani, tonight, Donald Trump is speaking out in defense mode today. He faces what

could be the most serious crisis of his presidency. His former attorney and longtime fixer Michael Cohen has directly implicated him in crimes

leaving many questions about what that means for Mr. Trump and what could happen next. Cohen's admission was one of two courtroom dramas to set off

a political earthquake. Just about 24 hours ago. Mr. Trump's former campaign chairman, Paul Manafort, was found guilty of financial crimes in a

separate case. Now, the president and his allies appear to be developing a strategy. Painting Cohen as a liar and Manafort as a victim. In his plea

deal, Cohen said he arranged two hush money payments for Mr. Trump for the principle purpose of influencing the 2016 election. Mr. Trump just said

this to Fox News. Listen to his reaction.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Did you know about the payments?

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Later on, I knew. Later on. But you have to understand what he did and they were not taken out of

campaign finance. That is the big thing. That is a bigger thing. Did they come out of the campaign? They didn't come out of the campaign. They

came from me and I tweeted about it. I don't know if you know, but I tweeted about the payments. But, they didn't come out of campaign in fact,

my first question when I heard about it was did they come out of the campaign because that could be a little dicey. And they didn't come out of

the campaign and that is fake. It's not even a campaign violation. If you look at president Obama, he had a massive campaign violation, but he had a

different attorney general, and they viewed it differently.

(END VIDEO CLIP)

GORANI: So, the Trump presidency, the White House's strategy is not a violation. There was nothing wrong with what was done; however, what

happens next, Michael Cohen may have even more to tell. His attorney said that this is a new beginning for Cohen and, quote, "his chance to tell the

rest of the story," unquote. Lanny Davis said that Cohen has information that might be valuable to the Russia investigation and said that his client

will not accept any pardon from Donald Trump.

(BEGIN VIDEO CLIP)

LANNY DAVIS, COHEN'S PERSONAL ATTORNEY: The answer is definitively no under no circumstances since he came to the judgement after Mr. Trump's

elect to the president of the United States that his suitability is a serious risk to our country. Certainly, after Helsinki creates serious

questions about his loyalty to our country. His answer would be no, I do not want a pardon from this man.

(END VIDEO CLIP)

GORANI: Paul Manafort's case is a very different scenario. He fought the charges against him, and a jury deadlocked on 10 of the counts but ended up

convicting him on eight others. Manafort new faces another trial next month and many, many years in jail. Let's bring in two of our reporters in

Washington. We're joined by Sarah Westwood at the White House and we're hearing directly today from the president on Fox News.

SARAH WESTWOOD, CNN WHITE HOUSE REPORTER: That's right. President Trump is denying that the crime, his former attorney committed to admitting to

committing the campaign finance violation is a crime. The from the is denying he did anything wrong. He's saying the payments in Cohen told

prosecutors about were not made illegally, and the White House moments ago held a press briefing and argued that the president did nothing wrong. They refused to

-- nothing wrong. They refused to explain discrepancies about what Trumps regarding the tapes he said in the past that he knew nothing about the

pages. He then said he knew about the payments but only far after the fact.

Of course, he's on tape recording made by Cohen, discussing the payments prior to them being made in 2016. As you mentioned, the president is also

speaking out and what appears to be some sympathy for his former campaign manager Paul Manafort. Trump hasn't ruled out pardoning Manafort. The

White House during that briefing didn't rule out that the president could at some point down the line pardon Manafort and now the White House is

turning its attention to the mid-terms when the fate of the house and by extension, potentially the presidency could be hanging in the balance and

could motivate Trump to campaign more aggressively for Republicans this fall.

GORANI: Of course, this would be significant if in Congress on Capitol Hill. If there were some momentum for looking at Donald Trump differently.

Even among the Republican party that now that his longtime fixture and lawyer has pleaded guilty to federal charges, implicating the president

that perhaps they might say something against the president. We know that hurts them in primary races. The Republican candidates. We're not hearing

much on Capitol Hill from Republican politicians, are we.

[15:05:02] SUNLEN SERFATY, CNN CONGRESSIONAL CORRESPONDENT: That is right, Hala. It's been fascinating to watch the Republicans' response here. Why

every they're responding at all, and many of them are not, they're responding largely very cautious and what they're saying, largely not

critical of President Trump here and that is because they, as you noted, this is not something they want to talk about. This is not something that

I need to talk about politically speaking. I think we see that reflected in large part by the lack of response from our Republican leaders on

Capitol Hill. Senate Major Leader Mitch McConnell ducked CNN's question outright this morning when asked about, for his response, the Speaker Ryan

saying through the spokeswoman that they're aware of the guilty plea.

They call them serious charges and essentially, he needed to wait for more information. The rank and file Republicans following suit there, taking

the White House talking points here. Really questioning the credibility of Michael Cohen, downplaying the significance of this. One Republican

senator saying today that Michael Cohen implication that the president was directly involved on campaign finance violations. He said he didn't see a

deeper meaning to it.

GORANI: And we'll talk about how the Democrats are reacting in a moment. Sarah, you mentioned the possibility there that Paul Manafort, who, by the

way, the president said extremely nice things about on Twitter, that where's a great guy, he didn't break, that this is all unfair and that they

dug up some 12-year-old tax case essentially to persecute him unjustly. We heard from Sarah Sanders. She was asked directly is the president

considering's pardon for Manafort. What did she say?

WESTWOOD: She said there was no discussions in the White House about pardoning Manafort. Of course, that is not taking it off the table. It's

interesting because the fact that Manafort was convicted on charges unrelated to the allegations of Russian collusion is something Trump and

his allies are starting to use as ammunition against the Russia probe.

They are saying look at this case. It has nothing to do with collusion and further proves the point that the Russia probe was all along a polit call

motivated witch-hunt. When, in reality, they're serious charges brought up on Paul Manafort and he could be convicted on more. President Trump is

standing by his former campaign manager, at the same time, lashing out at his former attorney, Michael Cohen. The difference and that reaction

appears to be he fact that Cohen cooperated with prosecutors and Manafort didn't appear to have done so.

GORANI: Thank you to both of you. Sunlen Serfaty on Capitol Hill and Sarah Westwood at the White House, we'll be speaking as I mentioned a

little bit later.

On the Democratic reaction and you might be surprised to hear Democratic politicians are saying let's wait a little bit before we start talking

about things like impeachment. There is an investigation going on. Let's give it time. We'll see what the result of that is.

I'll be asking our analysts why they are reacting the way that they are reacting after such a momentous and historic 24 hours in the Trump

presidency. Some called it the worst day of the Trump presidency. One Trump ally said the president will work harder to help Republicans in the

November elections, aware he could face impeachment proceedings if his party loses control of Congress. But could he face legal troubles as well?

Let's bring in CNN legal analyst Joey Jackson. Good to see you. Lanny Davis, the attorney for Michael Cohen said, quote, he's ready to tell

everything about Trump that he knows, which potentially could mean he's ready to help specifically on the Russia investigation. Should the

president be worried.? If so, why?

JOEY JACKSON, CNN LEGAL ANALYST: I absolutely believe the president should be worried and ready to tell. I think he told quite a bit in the courtroom

yesterday. What am I specifically referring to? When Michael Cohen pleaded guilty yesterday, what he did is he allocuted. What an allocution

is an admission of your signs to the judge. In those admissions of sins what, he said, Michael Cohen, was at the direction and in

Coordination with a candidate for federal office. That is referring to the president. Why is that significant? It's significant because the crime

itself, when you're pleading guilty, there is no element of the charge that requires coordination or direction, so he's offering and giving that

information. So, it's clear to me that prosecutors said as they condition to the plea, you going to go before the court and give information to the

judge that you work with the president to commit crimes. That is overwhelmingly significant.

[15:10:00] GORANI: Joey, Trump supporters would say of course he's going to implicate the president if he's asked to do it in this plea deal because

it greatly reduces his prison sentence.

JACKSON: Well, backing up for one moment, the reality is that you can make that argument, and I think at the end of the day in the event that there is

other information out there beyond Cohen's word, so let's be clear. In the event there was a trial, Hala,

what happens is, is that the government has to present its proof. And not only his word and saying yes, the president told me to do it but if there

is a trial you have to present proof and that proof is subject to cross- examination. It is subject to scrutiny and it is subject to examination.

In the event the information comes out which supports, corroborates and otherwise establishes what Cohen is saying is accurate, we have a

significant issue on a significant problem. On the issue of credibility to be clear, you can argue Cohen is not credible, but can we fairly and

reasonably say that President Trump is? When, you know, he tells lie after lie. To your question as to whether Donald Trump should be worried, I

think he is worried already. He needs to be more worried in light of what happened with Michael Cohen and in light of what happened with the guilty

verdict as it relates to Paul Manafort.

GORANI: And, of course, Donald Trump the president has changed his story time and time again about this hush money payment or these hush money

payments saying he knew nothing about them, saying he learned about them but only much later on and then we know on that tape that Michael Cohen

recorded the president that it was being discussed at the time that the payment was being organized in order to quiet some of those stories of

alleged relationships between the president and the porn star and the playboy model as well. Alan Dershowitz had this to say about breaking

campaign finance laws. Let's listen.

(BEGIN VIDEO CLIP)

ALAN DERSHOWITZ, ATTORNEY: Violation of election laws are regarded as kind of jaywalking. Every administration violates the election laws. Every

candidate violates the elect laws.

UNIDENTIFIED MALE: Right.

DERSHOWITZ: When they run for president.

(END VIDEO CLIP)

GORANI: He's saying this is like jay walking. No big deal.

JACKSON: A couple of things. Number one, obviously he's a brilliant man taking nothing away from him. Number two, I completely disagree. If you

look at what happened with John Edwards who ran for president, he was certainly pursued as it related to campaign finance. There was a hung

jury. A jury couldn't reach a determination. They found not guilty on one count but, clearly, they went after John Edwards, a former candidate for

the United States president. Furthermore, why don't you also tell that to Michael Cohen who plead guilty to 8 felonies, two of those felonies of --

being of campaign financing. So, if it's jay walking, didn't seen like he got a ticket yesterday but entered into a plea to do up to four years in

jail.

I don't buy the argument that it's jay walking, not an issue or not serious. That is a serious offense, a violation of federal law, a felony

under federal law. Finally, Hala, what happened in the courtroom as Michael Cohen essentially said that the president conspired with him, which

is an independent charge called "conspiracy." It's nothing to take lightly, no matter what Alan Dershowitz has said.

GORANI: Last one, we know that sitting presidents in the United States don't get indicted. When he leaves office, could there be criminal charges

brought against the current president of the United States?

JACKSON: Well, you know how -- that is a really two-step inquiry. Number one, presidents don't get indicted. That doesn't mean, right, and it's not

based upon a law but upon the Department of Justice guidance. That doesn't mean they escape accountability. What it means is they're subjected to the

political process. What that means is the Congress, the House of Representatives, consisting of 435 members, they get to decide whether to

impeach the president. It happened with Clinton.

GORANI: Yes.

JACKSON: Although you're impeached, it gets kicked to the Senate that consists of 100 members to convict. You need 67, 2/3 of those in the

Senate to convict. So, in the event of the midterm elections that you see shift from the Republicans to the Democrats, I think that it's highly

problematic for the president. I think you will see impeachment proceedings predicated upon his conduct here.

GORANI: All right we will see, although as you mentioned, it's a two-step process, requires a 2/3 majority in the Senate.

JACKSON: Right.

GORANI: And in terms of --

[15:15:00] JACKSON: It's heavy lift.

GORANI: Yes. Unlikely and we'll see what happens in November in terms of the House of Representatives for sure. Joey Jackson, as always. Thank you

so much for joining us. Really appreciate your time and analysis this evening.

Still to come tonight, it was an hour unlike anything we have seen so far in the Trump presidency. We walk you through how the news of the Cohen and

Manafort verdicts broke and how we watched history unfold. We'll be right back.

(COMMERCIAL BREAK)

GORANI: As you can imagine, this story was splashed across practically all of the major U.S. newspapers today. Want to show you a few: "Convictions

Tighten Squeeze on Trump" that is the headline of the "Washington Post" today. "All the President's Henchmen" reads the "New York Daily News" and

from the "New York Post" "Don's Cons, Two Trump Associates Face Jail."

As we mentioned, these two stories broke within the same hour, it was 60 minutes of history that rocked the Trump presidency. This is how CNN

brought you those events starting at 4:00 p.m. eastern.

(BEGIN VIDEO CLIP)

JAKE TAPPER, CNN HOST: We begin with breaking news this our politics lead. The president's former personal attorney and fixer, the man who once said

he would take a bullet for Mr. Trump, Michael Cohen, he surrendered to the FBI. This afternoon, Cohen was spotted entering the building that houses

the FBI field office in Manhattan.

(END VIDEO CLIP)

GORANI: Twenty-five minutes later came news the verdict in the trial of Paul Manafort.

(BEGIN VIDEO CLIP)

TAPPER: Breaking news in the case of the United States of America versus Paul Manafort, the former campaign chair for President Trump. It appears

the jury reached the verdict on some of the 18 counts.

UNIDENTIFIED FEMALE: They have reached a verdict. A unanimous verdict on eight of the counts, but they can't reach a consensus on 10 of the counts.

(END VIDEO CLIP)

GORANI: At 4:37 tolls, we got more details on exactly what that verdict was. Here was that moment.

(BEGIN VIDEO CLIP)

TAPPER: So, one of the 18 counts Paul Manafort has been found guilty. Now, I'm being told now that the jury found Paul Manafort guilty of 8 of

the 18 counts. The other 10, there is a mistrial declared.

(END VIDEO CLIP)

GORANI: You may have noticed the reporters rushing out of the courthouse to break that news. Some of them are interns just rushing to get the news

to the reporters outside. The moment of urgency there with journalists on the ground trying to get the information out as quickly as possible. CNN

had no time to rest. Less than 10 minutes later, my colleague Jake Tapper had to interrupt his panel discussion once more for this.

[15:20:00] (BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Look.

TAPPER: I'm sorry.

UNIDENTIFIED FEMALE: These are the facts, look at them.

TAPPER: Simone, I apologize. We have breaking news. Michael Cohen in New York, like a "Saturday Night Live" skit. The president's former fixer is

entering a guilty plea.

UNIDENTIFIED FEMALE: It's a pretty intense scene inside there. Michael Cohen is addressing the court now and he just walked through how he

committed 8 counts including tax evasion on his personal income taxes, giving a false statement to a bank and critically, he described how he

violated campaign finance laws. When asked by the judge to describe the crime, Michael Cohen said in coordination and at the direction of a

candidate for federal office. He had made these payments so he is implicating Donald Trump in this, although not specifically by name. So,

we just heard that. I ran out of the courtroom. Michael Cohen is still answering questions by the judge.

(END VIDEO CLIP)

GORANI: Well, our Brian Stelter has been tracking the media coverage of the story and joins us from New York. I want to bring in CNN White House

reporter Steven Collinson in Washington. Brian, one of the things I saw a lot on Twitter this morning were experienced veteran political journalists

who said if he had written this as a script for a television show, it would not be believable that two such momentous breaking news stories happened

within minutes of each other.

BRIAN STELTER, CNN SENIOR MEDIA CORRESPONDENT: Because the stories happened in succession, the way they did, I think it even further expressed

and emphasized the seriousness of this for the Trump presidency. For the president himself, for his inner circle and for the future of his

presidency. Sort of a 1-2 punch delivered by the legal system. I think even to folks who might be on vacation or mostly tuned out Trump news,

these are hard stories to miss. Hard stories to ignore.

GORANI: Right. There were sort of different worlds in the media landscape. Fox News, for instance, a network very sympathetic to the

president. Wasn't covering barely at all the Manafort and Cohen stories. They were talking about the tragic murder of a young woman who was killed,

the suspect who allegedly killed her is an illegal or undocumented immigrant.

STELTER: The pro-Trump media has a counternarrative. In this case, a lot of that narrative is about illegal immigration, focusing instead on this

terrible tragedy in Iowa. Partly because it does provide an alternative to having to talk all day about Manafort and talk all day about Cohen, et

cetera, et cetera, et cetera. What I am seeing is a lot of denying of reality from the pro-Trump media. Attempting to downplay this, dismiss it

altogether. Somehow it was a setup, you know, as the going gets worse for Trump and his allies. The attempts to deny any reality have to get more

and more extreme.

Look out today. Sarah Sanders saying the president has never lied. The kind of denial of reality is getting more and more extreme. I think to

most of America, this looks like "All The President's Men," the sequel. There are a lot of shades of 1974 here, but we're seeing from the

president's preferred outlets that there is a lot of denial of reality in step.

GORANI: Is this going to work, continue to work as a strategy, Steven Collinson? Because ignoring stories hike Manafort and Cohen yesterday when

literally, I can tell you the entire world was riveted. Not just the United States. Everyone in Europe, the Middle East, Africa and you check

Twitter. It was a trending topic everywhere. This continued denial of the stories making headlines everywhere else on Fox. Will it continue to work

with Trump's base, do you think?

STEVEN COLLINSON, CNN WHITE HOUSE REPORTER: Hala, I think one of the big takeaways of yesterday was that truth and facts and the legal process

matter.

President and his supporters can spin this alternative reality, they can say truth is not truth as Rudy Giuliani said in the weekend. Can contort

the facts but at some point, there is going to be a reckoning, that came for Michael Cohen and Paul Manafort in the cases yesterday. It looks like

it's getting closer and closer for the president. Yesterday was a huge victory for the Special Council Robert Mueller who has been under intense

fire by the president and his conservative allies, especially on Fox News.

[15:25:00] If what happened yesterday is an omen for what happens down the road when Mueller tackles the arguably more important questions of Russian

collusion and alleged obstruction of justice in the firing by the president of James Comey, I think we will see that trend reinforced. At some point,

the alternative reality, the White House tries to spin and everyone else around the president tries to spin hits a brick wall, if there can be proof

there was wrong doing. The question, does that reshape the political terrain? Will that make Republicans more willing to censure the president?

That question is likely to be answered in the mid-term elections in November, not before.

GORANI: Do you agree, Brian? You think eventually this will all hit a wall because it's unsustainable? The manufacturing of an alternate

universe of fact.

STELTER: I think we have to separate out. When we say Trump's base, there is a fascination with this. Forty percent of America supporting President

Trump in polls. The 40 percent is not the same, you know. There are some loyalists in there who say I only believe what Trump tells me. Flatly.

That scares me as someone who would never believe any president just because they said it. Hey, that is them. I don't think all 40 percent,

though, are as loyal to President Trump as those hard-core fans.

What we see in polling is that some of that 40 percent kind of supports Trump but not strongly. So, the legal peril, the legal drama in Washington

and New York, I think it could have an affect on the portion of the president's base and on a portion of the pro-Trump media. Maybe now with

the hard-core fan base. The ones going to the rallies. There will always be folks going to the rallies and believing what is said. They may become

a smaller and smaller number if the stories become more and more embarrassing to the president.

GORANI: We'll see if the polling supports that, if this day August 21st, 2018 will go down in history as a game changer day. Brian Stelter and

Steven Collinson, thanks so much to both of you.

Still to come. That silence you hear is top U.S. Republican lawmakers responding to these serious new allegations against Donald Trump. Will

Michael Cohen's admission in court be that game changer for this presidency? We'll be right back.

(COMMERCIAL BREAK)

[15:30:00] GORANI: Well, it's a dramatic development in a months long scandal. The U.S. president's former personal attorney admitting in court

under oath that he paid women to prevent their alleged affairs with Trump from becoming public during the 2016 campaign and importantly, that he did

so under the direction of Donald Trump. There is a lot to remember in all of this. Wolf Blitzer takes you through what happen step-by-step.

(BEGIN VIDEO CLIP)

WOLF BLITZER, CNN HOST: January 12th, 2018. "The Wall Street Journal" reports that Michael Cohen arranged a $130,000 payment to adult film star

Stormy Daniels one month before the 2016 election to keep her from going public about an alleged affair with Mr. Trump. In a statement, Cohen

called the allegation about the affair outlandish. Then, on February 13th, Cohen told "The New York Times" that he used his own personal funds to pay

off Daniels, saying neither the Trump organization nor the Trump campaign was a party to the transaction and neither reimbursed me for the payment.

On March 5th, "The Wall Street Journal" reported that Cohen wired the money to Daniels' lawyer 12 days before the election. Cohen responded with a

two-word e-mail statement, fake news. Two days later, the White House weighed in.

(BEGIN VIDEO CLIP)

SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: I have had conversations with the president about this. There was no knowledge of any payments from the

president, and he denied all of these allegations.

(END VIDEO CLIP)

BLITZER: On April 5th, President Trump broke his silence on the Stormy Daniels payments denying involvement.

(BEGIN VIDEO CLIP)

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

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: No. No.

UNIDENTIFIED FEMALE: Why did Michael Cohen made that if there was no truth to her allegations?

TRUMP: Well, you have to ask Michael Cohen. Michael's my attorney and you'll have to ask Michael Cohen.

BLITZER: But a few days later, he acknowledged Cohen did represent him in the deal with Daniels.

TRUMP: He represents me like with this crazy stormy Daniels deal, he represented me and, you know, from what I see, he did absolutely nothing

wrong. There were no campaign funds going into this, which would have been a --

UNIDENTIFIED FEMALE: Then why is he pleading the fifth?

BLITZER: On May 2nd, Mr. Trump's current lawyer, Rudy Giuliani, took it one step further.

RUDY GIULIANI, PRESIDENT DONALD TRUMP'S ATTORNEY: No campaign finance violation. So they funneled it through a law firm. Funneled through a law

firm and the president repaid it. But he did know about the general arrangement that Michael would take care of things like this.

BLITZER: The following morning in a series of tweets, Mr. Trump added that Cohen received a monthly retainer. Then, on July 24th, Cohen's lawyer

released a secret recording between Cohen and Trump discussing the logistics of another payment, this time to former Playboy model, Karen

McDougal.

MICHAEL COHEN, PRESIDENT TRUMP'S FORMER LAWYER: When it comes time to the financing which will be -- we'll have to pay this -- this is getting old.

TRUMP: No, no, no.

BLITZER: On August 21st, Cohen officially flipped on his former boss. And pleaded guilty to campaign finance charges stemming from those payments to

Stormy Daniels and Karen McDougal.

He also told the federal judge the McDougal payment was for the principle purpose of influencing the election.

(END VIDEOTAPE)

HALA GORANI, CNN INTERNATIONAL HOST: We should note, of course, that President Trump has denied affairs with these two women. His entire

presidency has been marked by one bombshell after another. And yet, Donald Trump is still standing.

Is Cohen's new accusation against his former boss a game changer or will it fade away like so many scandals before it? Let's bring in our political

director, David Chalian.

So, how do you answer that question? Because he survived every other scandal mainly because Republican politicians in Washington know that going

up against Donald Trump, hurts them politically.

DAVID CHALIAN, CNN POLITICAL DIRECTOR: Right. It all depends on how you want to define game changer. In my mind, this is definitely a game changer

in the sense that the president of the United States has been implicated in a federal crime, in court approved by prosecutors and a judge as part of

Cohen's plea agreement. So that's a game changer.

Does that mean it will politically damage him in ways we haven't seen previous scandals before? I don't know the answer to that. We'll have to

see.

What I do know is that Republicans on Capitol Hill here in Washington, Hala, are following the same playbook despite the fact that this was a

game-changing event yesterday. Their playbook of silence and not taking the president on, on this and not conducting their responsibilities as a

co-equal branch with oversight responsibilities.

Instead, as you noted, they remain more fearful of political harm inside of their own party if they take on the president.

GORANI: Could this have an impact on the midterms? I've asked the next big hugely important test in the United States. Could -- I mean obviously,

the diehard Trump supporter base might not be swayed by any of this, but what about others who may have voted for Donald Trump this time around but

had voted for Obama in the previous election?

Could you see a real change there in the midterms because of scandals like this?

Chalian: Certainly. You don't even have to say because of this. We see in all of the data and all of the historic trends.

GORANI: Yes.

CHALIAN: That this would be a really rough midterm year for the president. It is -- that is the, sort of, normal course of business that the president

suffers losses in the midterm election. The party in power tends to suffer losses and that's poised to happen now.

You mentioned the 2016 election. Remember, Donald Trump actually won independent voters in the 2016 election against Hillary Clinton. That is

not the case in any polling about Donald Trump right now. He is severely upside down with independent reporters.

So he's already below in terms of levels of support where he was, when he won the presidency. But how that translates when he's not on the ballot

and will voters sort of punish the Republican Party because of Donald Trump? History suggests they may. But Donald Trump defied so much history

in 2016 that we have to wait and see.

GORANI: Right. That is kind of what we're all doing after the big surprises of 2016.

David Chalian, thanks so much for joining us.

CHALIAN: Thanks, Hala.

GORANI: Veteran journalist, Carl Bernstein said this is worse than Watergate. And he would know. He helped, of course, uncover the 1970s

scandal that eventually forced the resignation of U.S. president Richard Nixon.

[15:35:04] Carl Bernstein joins me now live.

In what ways is this worse than Watergate?

CARL BERNSTEIN, VETERAN JOURNALIST: Well, until yesterday when finally the judiciary showed the kind of independence and freedom from malign influence

that has been absent since the beginning of this investigation because of the president's actions and words, there's been very little evidence that

the system is working to hold the president of the United States accountable and to establish that no one in this country is above the law,

including the president of the United States.

Certainly, the Congress has failed in its ability to hold him responsible. The Republican Party has failed.

But, finally, the -- we received some signs, perhaps, with the Manafort verdict and with the Cohen plea that has raised matters to a new level as

well as finally given some indication of elements of the system working. But the system worked in Watergate.

GORANI: Yes.

BERNSTEIN: That the press did its job. The judiciary did its job and especially the Congress of the United States did its job. That has not

been happening here.

GORANI: So we heard nothing from top Republicans or very little. But interestingly, we didn't hear really much from Democrats. Top Democrats on

Capitol Hill are saying -- in fact, this is a montage of what we've heard from them over the last 24 hours. And then I'll get your take.

(BEGIN VIDEO CLIP)

SEN. ELIZABETH WARREN (D), MASSACHUSETTS: Protect Robert Mueller, let him finish his investigation. And when we've got that, then we can make a

decision on what the appropriate next step is.

UNIDENTIFIED FEMALE: I don't think we should be talking about impeachment.

SEN. RICHARD DURBIN (D), ILLINOIS: At the very minimum, we should be withholding this decision on the Supreme Court nominee until the year is

cleared.

SEN. RICHARD BLUMENTHAL (D), CONNECTICUT: We should talk about all the remedies. Every single remedy, including indictment of the president

should be on the table. The president can be indicted.

(END VIDEO CLIP)

GORANI: And, Carl, I mean from the outside looking in internationally, people would have assume the Democrats would jump on this and say this

president is implicated in a federal crime. We've got to look into impeachment. They're not doing that. Why not?

BERNSTEIN: First of all, I think that most of that response that I heard is absolutely appropriate. We have an ongoing investigation by a federal

prosecutor that we need to get the special prosecutor's report and his findings and then see what reaction is appropriate. We need to more many

more facts.

I think that a rush to judgement here in terms of coming in with verdicts and perspective actions against the president of the United States before

we know the full record what, indeed, is appropriate here is to protect the investigation by Mr. Mueller, the special prosecutor, for the press to do

its job. The press has done a magnificent job of reporting this story and is responsible in large measure for Mr. Trump's lives. Not gaining

traction to the extent it goes beyond his base and some craving Republicans on Capitol Hill who seem uninterested in the facts and are fearful of Mr.

Trump and his bias.

But no, I think that -- let's take a deep breath here and let's look at the facts.

GORANI: And how do you think this will unfold then? Do you think that there will be a before and after August 21st?

BERNSTEIN: Let me stop right now.

GORANI: Yes.

BERNSTEIN: Let me interrupt you.

GORANI: Sure.

BERNSTEIN: I think we need to stop crystal balling. I think it is a big mistake for the press, particularly, to be making predictions. It's one

thing to say, all right, we know from our reporting that the midterm elections have achieved a great deal more importance here because they are

a kind of referendum on Donald Trump.

And given his actions and particularly he's covering up and particularly his attempts to obstruct the Mueller investigation and what the underlying

facts might be, that this might at some point lead to an impeachment investigation. But we need more facts.

[15:40:57] I think that we just need to slow this train down. Except we can accelerate this train in terms of looking at what Donald Trump says and

does and what we know so far. We need to be looking at the most remarkable set of facts since he took office that we have developed that shows a level

of sewage seeping from the White House front lawn from the swamp gas of this presidency that it's palpable. And it's from the top. And that's the

story.

GORANI: No crystal ball. I'm not your crystal ball, but you say facts, absolutely, and the facts are that the president even today, in a Fox News

interview, said, "I only learned of these payments after the fact, "when we have them on tape in a secret recording discussing payments with Michael

Cohen. So these are -- I mean, these are -- he's not telling the truth. At some point, how will this have a political impact?

BERNSTEIN: There's no surprise to anyone and even his supporters know he regularly and habitually does not tell the truth. The Trump's lies are

actually an elemental aspect of him, his presidency, his record and public life as a businessman. And since he has started to flirt with politics a

good while back. Nobody should be surprised by his lying.

GORANI: Carl Bernstein, thanks so much for joining us.

BERNSTEIN: Now he has consequences.

GORANI: Yes, yes. Thank you so much. Appreciate it. Carl Bernstein.

Still to come tonight, we were discussing the midterm elections and how they're more important than ever. Will this bombshell change anything?

We'll be right back.

(COMMERCIAL BREAK)

GORANI: Well, while all of this scandal is swirling around him, this is the U.S. president. These are live images coming to us from the White

House. There's a solemn ceremony going on. Donald Trump is awarding the Medal of Honor to an air force sergeant killed in action in 2002 in

Afghanistan.

We are monitoring the president's remark. It's a posthumous award, by the way, because the airman was killed in the line of fire. Killed in action

and we'll bring you any news that comes out of this ceremony as it pertains to what has emerged over the last 24 hour says from these two separate

court cases.

Well, the White House sweats over the latest head-spinning legal drama. At the other end of Pennsylvania Avenue, the reactions from Capitol Hill

differed, depending on what side of the political divide you're on. Democrats are being a little bit more vocal, unsurprisingly, but the

Republican leadership is staying silent.

CNN managed to track down a few Republican Congress people and here are their reactions.

(BEGIN VIDEO CLIP)

SEN. ORRIN HATCH (R), UTAH: Naturally, I'm actually very concern but, you know. The president shouldn't be held responsible for the actions of the

people that he's trusted.

UNIDENTIFIED MALE: What about Michael Cohen? He's plead guilty. And that's the way the constitution works --

(CROSSTALK)

UNIDENTIFIED MALE: About him to worry about.

SEN. JOHN KENNEDY (R), LOUISIANA: Mr. Cohen's credibility is going to be challenged. I think the full story hasn't been written yet.

(END VIDEO CLIP)

GORANI: Well, all of this is happening 75 days ahead of the midterm elections. So, how do the parties use the latest news as polling day

nears?

Jason Miller is a CNN political commentator and former senior communications advisor for the Trump campaign. Jason, thanks for being

with us.

Kaitlan Collins in the briefing today asked a very simple question of Sarah sanders who just wouldn't answer it over and over again. She asked, you

know, the president has said different things about these payments to this porn star and the Playboy model at different points in time. They sound

like lies.

[15:45:10] On the one hand, he said he knew nothing about the payment then said he learned of the payments about much later. We have them on tape

saying discussing the payment with Michael Cohen. The president does not seem to want to be truthful with this matter. Why should anyone trust what

he says?

JASON MILLER, CNN POLITICAL COMMENTATOR: Well, I think to your direct question here, Hala, I think the White House and the president are going to

have to put forward a much clearer answer on this question that Kaitlan presented at the White House press briefing.

And I think at the same time, I think what we're going to see is some very direct criticism going up Michael Cohen's credibility. I think these

claims that were made against the president in the southern district in New York court yesterday, out in New York, were coming from someone who has now

admitted eight-time felons, someone who didn't pay their taxes for five years. Someone who a year ago said they'd take a bullet for the president

and now appears to be making some additional claims and a hope that they're going to try to get a better deal.

But all of that aside, the White House still has to have a much better answer on this just saying -- purely just saying that Michael --

GORANI: But couldn't they just tell the truth a little bit more often? Because it seems as though when they are confronted then with evidence, the

story changes. And it seems difficult then to say to Americans trust us when they're caught in lines so often.

MILLER: Well, and that's why I said to your very clear question, someone who's a strong supporter of the president. I'm not sure what exactly that

answer or what exactly that story is. That's not something clearly that I was a part of.

GORANI: Well, the latest version is that he learned of the payments but later on, even though on the tape, the secret recording, it sounded like an

entirely different story.

MILLER: And that's why I think that the White House is going to need to come together with a much clearer and much more definitive answer because

what we heard today isn't something that's going to work over this next 75 days.

And as you mentioned in the lead-in, we are -- we're just only a little over two months away from the midterm elections where every single member

of the House of Representatives is up for re-election and in the third of the Senate and here's why this is important for folks outside of the U.S.

for seeing this and wondering kind of what this all means is if the Democrats were able to retake Congress, I am fully convinced that they will

push to try to impeach President Trump.

And if they're controlling that, they're going to push towards that. And I still think that Republicans are in the driver seat for maintaining control

of the Senate. I think we could see a scenario where Democrats could win back the House and republicans could actually pick up one or two seats in

the Senate to stop that.

Bu the developments that we saw yesterday basely what that's going to mean is the next 75 days will be a purely a referendum on the president and

we're going to see this Michael Cohen drama over and over every single day. And so the sooner that the White House comes out with a much clearer and a

much more direct answer, the better they're going to be off.

GORANI: If there is proof out there that, in fact, Michael Cohen acted, you know, on the orders of the president, that these payments were made as

Michael Cohen alleges because the president asked him to make them. Would that make you question your support for the president because then that

would be something that he's denied all along, you know, and that Michael Cohen has said in court under oath.

MILLER: Well, that's not the case as of right now. And I hate to get into the speculation game when clearly the president and White House has said

one thing and Michael Cohen is saying something different. In fact, Michael Cohen has said something different now multiple times over and

over.

GORANI: So has the president.

MILLER: But again, this is why I go back to -- and as a strong supporter of the president, I'm hear saying that they need to have a much stronger

and a much clearer and a much better answer on this. Because there should be much more direct. Because again, yes, this impacts the White House and

the administration, but also impacts the Republicans who want to maintain the Senate impacts the Republicans who are running for Congress or running

for the House.

And then obviously, this is going to then roll right into how it impacts President Trump running for re-election. So it impacts everything across

the board, including his domestic and international agenda. So this is very important that they have to get this right.

GORANI: Thanks very much, Jason Miller. Appreciate your time this evening.

More to come, including what do conservative American voters think of all this legal chaos swirling around the White House? I'll speak to an

outspoken radio host in the U.S. He's an ultraconservative. But still, no fan of Donald Trump.

(COMMERCIAL BREAK)

[15:50:16] GORANI: Well, by most accounts, Tuesday was a bad day for Donald Trump. Some pundits called Michael Cohen's guilty plea and Paul

Manafort's conviction the worse day of the Trump presidency.

But the most ardent Trump supporters say that's not the case and they point to the lack of a direct connection to allegations of Russian collusion. As

proof ...

(BEGIN VIDEO CLIP)

SEAN HANNITY, HOST, FOX NEWS CHANNEL: It has nothing to do with Russia collusion. Nothing. Paul Manafort earlier today found guilty of the eight

of 18 charges all related to bank and tax fraud. No Russia collusion. Michael Cohen plead guilty eight counts of bank fraud, tax fraud, minor

campaign finance violations far worse has been committed by others, no Russia collusion.

(END VIDEO CLIP)

GORANI: My next guest begs to differ. Joe Walsh, he's a former Republican congressman who once supported Donald Trump, but that ended with the

Helsinki summit. Walsh tweeted earlier that yesterday's events are no witch-hunt, something that the president often calls, Mueller's

investigation, but instead is a search for the truth, according to him.

Joe Walsh is joining me from Chicago via Skype.

Hello. Well, what are your thoughts -- yes, the last 24 hours, I've been asking my guests this. Do you believe this is some sort of big historic

game changer for the Trump presidency? What are your listeners saying?

JOE WALSH, FORMER REPUBLICAN CONGRESSMAN: It's interesting and you just played the clip from Fox News. Unfortunately, so many of my listeners are

being fed that crap. Fox News is performing a real disturbance right now, because look, we don't know if there's collusion or some sort of a

conspiracy. But if there are ever any serious charges brought against this president, his supporters are going to be stunned, because Fox News and

much too much of conservative media simply has not been honest with their viewers and their listeners. It's a real shame.

GORANI: So you tell your listeners who are many of whom are big Trump fans, right? They're ardent Trump fans. You give them presumably, I

imagine based on what you're tweeting a different narrative. When you do that, what's the reaction?

WALSH: Again, truthfully, a lot of my listeners and Trump supporters are upset. I've said from the beginning, from the beginning of the whole

Russia mess, let's wait until Robert Mueller is done. Let's find out what the truth is.

And that's where a lot of listeners are. But again, they're being fed so much baloney that -- about the deep state and the witch-hunt that they

don't know what to believe. And with what went down last night, I heard a lot of confusion, a lot of confusion out there by Trump supporters. What

does this mean? It can't be good.

GORANI: So, obviously, we're seeing all over the world, Joe. And there aren't many Trump fans in Europe. Let's be honest. And I think the big

question I get from people who watch us on CNN and who follow these stories, especially big cases like Manafort and big stores like what

happened with Michael Cohen, is they say, at what one point will ardent- Trump supporters question their support for the president? What would it take? What's your answer to that?

WALSH: I stopped believing this president a long time ago. I just don't believe a word that comes out of his mouth. I think when it gets to the

point where the average Trump supporter can no longer believed him. Earlier, you played that clip of him today saying that he didn't know about

the payment to Stormy Daniels when he's on tape saying it.

I mean, it's like every day, there's another nick, nick, nick. Eventually, it's going to get to the point, I think, with his supporters where they're

just going to say time out, I'm just tired of being lied to. I think that's what we'll probably finally bust the dam.

[15:55:13] GORANI: I'm interested in knowing though why you to think that that will happen when it hasn't happened yet, because you mentioned, for

instance, him telling the Fox News interviewer today, the president, I mean, you know, I didn't know about the payment until much later when there

is a recording of him discussing that payment in 2016 with Michael Cohen.

So, what would it be just the kind of accumulation of lives or statements that contradict each other? Is that what it would be for some supporters?

WALSH: Yes, I think you're right, because every time I come on the air on radio or T.V. and we talk about the latest subject and we talk about the

problems the president with -- the problem he's got telling the truth. Every time I hear less resistance from his supporters, more discouragement.

So I do think it's just building up overtime.

But look, I'll be honest. When Mueller comes out with his report, because of the crap that so many of his supporters are being fed by Fox News and

others, 35 percent of this country won't believe a word that Robert Mueller says.

GORANI: Uh-hmm.

WALSH: That's an absolute shame.

GORANI: Yes. And I just want our viewers too to -- I want to remind our viewers, you are not a liberal. Quite the opposite. You are very

conservative on social issues on immigration. You told me the last time you spoke -- you don't believe Donald Trump is going far enough, in some of

the -- for instance in the ban on immigrants from Muslim countries and things like that.

Yet, it's just him, it's the president himself, not the ideas that you object to, right?

WALSH: Oh, my gosh. I want the wall built tomorrow. I don't want Muslims in this country who will do us harm. I want to get rid of Obamacare. I

mean, I could go on and on and on. I was a Tea Party congressman in Congress. That's still where I am.

And see part of the problem here is Trump doesn't believe any of these stuff. But this is -- these are the issues that I desperately believe in.

He just can't tell the truth.

GORANI: Joe Walsh, thanks much for joining us. Appreciate it. Very interesting perspective and interesting to hear what your listeners are

telling you on your radio show. Thanks to all of you for watching us. I'm Hala Gorani. Stay with CNN. "QUEST MEANS BUSINESS" is up next after

break.

(COMMERCIAL BREAK)

END