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Elizabeth Warren Releases DNA and Video; Hurricane's Role in Elections; Kushner Avoided Taxes. Aired 8:30-9a ET

Aired October 15, 2018 - 08:30   ET

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

[08:30:00] DONALD TRUMP, PRESIDENT OF THE UNITED STATES: You, I apologize. To the -- to the fake Pocahontas, I won't.

(END VIDEO CLIP)

JOHN BERMAN, CNN ANCHOR: Obviously the question is, why did she release this? Why do it today? Does this mean she's running for president in 2020?

Joining us now is "The Boston Globe" reporter who broke this story, Annie Linskey.

Annie, thank you so much for being with us.

And I have to say, you know, I wake up at 3:15 and there are articles, you know, once every few weeks or so that I'm like, oh, my gosh, I -- this came out of nowhere. I was shocked to see this.

ANNIE LINSKEY, BOSTON GLOBE" REPORTER WHO BROKE WARREN DNA STORY: Yes.

BERMAN: So how did it come to pass and why?

LINSKEY: Well, you know, this is something that at "The Globe" we've been tracking so closely. And it's something I've been asking about for weeks and weeks and weeks and really months. I just suspected perhaps they were going to go ahead and do something like this because Elizabeth Warren can be kind of surprising. I mean she's -- she's a very strategic thinker.

So I was -- I had some sense that something like this was coming, but I didn't really learn until Saturday morning -- or Sunday morning, rather, when I got a copy of the report. And I remember getting it and then going to a coffee shop and just thinking, oh, I've got to sit down and have some coffee and just like read this carefully before I tell anybody, even my editors, about it.

BERMAN: So I have a copy of this DNA test here.

LINSKEY: Yes.

BERMAN: What exactly is it? Who did she go to and what did they find?

LINSKEY: So she did this in an interesting way. A lot of people, you know, when they get their DNA analyzed, they go to ancestry.com or 23andMe, two of the bigger companies. She went a slightly different route. She went to a lab. I believe it's in Georgia. And then had the analysis of her genome sent to really one of the world's leading experts in DNA analysis. And this guy, Carlos Bustamante, a Stanford professor, is somebody who I was actually aware of before she told me that this is the way that she did it. He's -- he's really very well- known and very well respected in the field and he's done a -- he has a McArthur Genius Grant that he got for the very concept of tracking human population migrations via DNA. So he is really the person that everybody who I talked to beforehand was saying, this is who I would go to if I were you.

And then I called him and he never called me back. So I kind of suspected that he was working on this while I was calling him.

BERMAN: And he found what in terms of how much Native American DNA she has?

LINSKEY: So it was -- it was really interesting. The way that he characterized it is, he said that he has a high degree of certainty that Elizabeth Warren had at least one Native American ancestor in her family tree going somewhere between six and ten generations back. And that's a really interesting -- you know, that's a -- that's a big window because that puts her anywhere from 1/32 Native American to something like 1/512 Native American, which is a lot smaller of a percentage. So, in either case, really, you're looking at a very, very, very small percentage. But this is the first sort of documentary evidence that supports this claim that Warren has always made that there's been this family lore of Native American heritage.

BERMAN: Does it support that claim if it's between 1/32 and 1/512?

LINSKEY: I think that if it's 1/32, it's more supportive. But what it does is it says that these family myths, which they've been up until now, are based somewhere in fact. That it's not a complete fabrication. It's not an utter family myth.

I mean I know my family, we have some crazy family myths that we're related to the Kennedys, and I don't think that's true. But I would never say it. And in her case she finally has some sort of evidence that, look, hey, my grandma's stories were, you know, rooted somewhere in fact.

BERMAN: It's also interesting, obviously. The first part of this that I saw was the DNA test. And then, a few hours later, we see this elaborate five-minute video.

LINSKEY: Yes.

BERMAN: So this is part of a rollout, a really produced -- heavily produced rollout. What more can you tell us about that?

LINSKEY: Yes. Yes. Well, I mean, that is really interesting. There is the video that was produced. And if you watch that video, there's, you know, footage of Elizabeth Warren, you know, calling Dr. Bustamante to get her DNA results and then magically, you know, Warren's camera crew is also on the other end to capture Dr. Bustamante telling her what those results are. So this was, you know, very carefully managed.

And they also launched a website. They're launching a whole slew of FaceBook adds to post -- to push people to their new website. So they just have a sort of multimedia slew of things that they're doing.

BERMAN: I keep checking my Twitter feed to see if the president has responded directly to this.

LINSKEY: I know.

BERMAN: My suspicion -- and you can talk to this -- is that she would love it if the president engaged further on this.

LINSKEY: Yes. Well, I mean, I think that's the trick here, that, in this case, you know, so often Trump is kind of using other people's weaknesses and she's sort of reasserting herself and taking back that narrative. I mean she clearly has concluded that she's winning a little bit when Trump is talking about her and not one of the other, you know, 30 people who might run for the Democratic nomination for president. And Trump feels that he's winning because he riles up his base with this.

[08:35:26] So I am very eager. I've already, of course, asked the White House, you know, whether or not Donald Trump does indeed to give a million dollars to a charity of her choice, the way he said he would if she took the DNA test.

BERMAN: Are we going to hear from her, a news conference or anything you think, over the course of the next day on this?

LINSKEY: I doubt it. I mean I have not been alerted to that. She's been much more open with reporters. But, of course, when people talk about the timing, you know, the Senate is not in session right now. So it's a little harder to catch her in the hallways. And I think if you want to go, you know, get her comments on this, you're going to have to fly to Boston. And so it makes it a little bit -- a little bit trickier.

BERMAN: You may want to go to Iowa or New Hampshire if you're looking for her in the next several weeks. She may turn up there. Just thinking maybe.

Annie Linskey, great report.

LINSKEY: Thank you.

BERMAN: As I said, this one caught my attention in a big way this morning. Appreciate it.

LINSKEY: Thanks.

ALISYN CAMEROTA, CNN ANCHOR: All right, John, we are about three weeks away from the midterms, so how will Hurricane Michael impact the hotly contested governors and Senate races in Florida?

BERMAN: And when a boss has an affair with an intern, is it an abuse of power, especially if that boss is the president of the United States? Hillary Clinton has some surprising thoughts on that, next.

(COMMERCIAL BREAK)

[08:40:29] ANNOUNCER: This is CNN breaking news.

BERMAN: All right, breaking news from the president. A statement moments ago about the crisis, the controversy surrounding "The Washington Post" columnist Jamal Khashoggi, the Saudi journalist who went missing and the Turks say was killed inside the Saudi consulate in Istanbul. This is what the president just wrote. Just spoke to the king of Saudi Arabia who denies any knowledge of whatever may have happened to our Saudi Arabian citizen. He says that they're working closely with Turkey to find answer. I am immediately sending our secretary of state to meet with the king. That's the news there. Secretary of State Mike Pompeo, according to President Trump, going to meet with the Saudi king, presumably in Saudi Arabia.

This comes as the Saudis confirm that they will let Turkish authorities search the Saudi consulate in Istanbul as part of their investigation.

CAMEROTA: All right, other news, President Trump tweeting moments ago that he and the first lady are heading to Florida and Georgia today to assess the damage from Hurricane Michael. The storm could play a pivotal role in Florida's hotly contested races.

CNN's Ryan Nobles is in Washington with more.

How is it looking, Ryan?

RYAN NOBLES, CNN CORRESPONDENT: Well, Alisyn, Florida features perhaps the most competitive governor's race in the country and a Senate race that could play a big role in determining which party controls that chamber after the midterm.

You know, I was in Tallahassee before, during and after the storm. It was impossible to get the campaigns to talk about the political implications of the hurricane. But even though they aren't talking about politics, there is no doubt that the way they handled this storm could play a major role in who wins and loses in November.

(BEGIN VIDEOTAPE)

NOBLES (voice over): There are few things that impact Floridians more than hurricanes. And with millions of voters in the path of Michael, every move their leaders make, as the storm hits --

MAYOR ANDREW GILLUM (D), FLORIDA GUBERNATORIAL CANDIDATE: Do not leave your homes.

NOBLES: And during the recovery --

FL. GOV. RICK SCOTT (R), U.S. SENATE CANDIDATE: This hurricane was an absolute monster.

NOBLES: Is under a microscope, especially in an election year. Hurricane Michael came ashore with less than a month until Florida's

elections for governor and U.S. Senate, bringing with it opportunities and risks for candidates in those races.

Three of the four major party nominees are serving in roles that are directly responsible for storm management. And though the backdrop of the political implications is clear, don't expect the candidates to acknowledge it.

SCOTT: My goal is to get everybody to safety. This isn't about politics.

NOBLES: The best political strategy?

GILLUM: We've seen significant damage.

NOBLES: Avoid the campaign trail all together and focus on their day jobs.

For U.S. Senate Candidate Rick Scott, a Republican, that mean his current role as governor, giving regular updates and granting plenty of interviews.

His opponent, Democratic Senator Bill Nelson, is doing the same. He was in Washington as the storm hit, but made sure to explain why.

SEN. BILL NELSON (D), FLORIDA: I came here to vote on the water bill, of which we have critical projects for Florida. And I'm flying back.

NOBLES: And rushed back to the panhandle as quickly as he could to survey the damage.

Tallahassee's mayor, Andrew Gillum, is the Democratic nominee for governor. He too left the campaign trail and was on television nonstop.

GILLUM: And I've watched these storms from the comfort of my own living room before and said, oh, well, it won't be that bad. Do not make that calculation.

NOBLES: He even hit the streets of his city with a chainsaw to kick- start the recovery.

Meanwhile, his opponent, former Congressman Ron DeSantis, turning his campaign into a relief drive, collecting donations instead of trying to win votes.

RON DESANTIS (R), FLORIDA GUBERNATORIAL CANDIDATE: We want to make sure that we get supplies on the ground as soon as possible.

NOBLES: This storm could potentially keep the candidates off the campaign trail for two weeks. Scott and Nelson even postponed a CNN debate, originally scheduled for Tuesday night. So far that aggressive approach is striking the right cord with some voters.

ROSEZETTA BOBO, TALLAHASSEE RESIDENT: I think the governor did a great job. I think the mayor did an excellent job.

NOBLES: Yet for others responding to a hurricane is a bare minimum requirement for the job.

UNIDENTIFIED FEMALE: If somebody wants to be in that position, he should be able to do that to start with.

(END VIDEOTAPE)

NOBLES: And as of this morning, Bill Nelson, Andrew Gillum and Rick Scott are still staying off the campaign trail. There's no indication when they will return.

And it's important to keep in mind, Florida is a pretty big state and this storm hit a relatively small section of the population. But even though voters in Miami may not be cleaning up debris this morning, you can bet they are watching how these leaders respond to this crisis because it could easily be them the next time around.

John.

BERMAN: Ryan Nobles in Washington for us. Look, helping people who are suffering from the hurricane, it happens to be good, pure and simple. It can also be good politics.

Appreciate it, Ryan.

NOBLES: Exactly.

[08:45:03] BERMAN: Former Secretary of State Hillary Clinton, adamant that her husband's affair with Monica Lewinsky while he was president was not an abuse of power. In an interview with "CBS Sunday Morning," she said that Lewinsky, then a 22-year-old White House intern, was, quote, an adult. Clinton then brought up the multiple allegations of sexual assault and harassment leveled against President Trump.

Watch this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: In retrospect, do you think Bill should have resigned in the wake of the Monica Lewinsky scandal?

HILLARY CLINTON, FORMER DEMOCRATIC PRESIDENTIAL NOMINEE: Absolutely not.

UNIDENTIFIED MALE: It wasn't an abuse of power?

CLINTON: No. No.

UNIDENTIFIED MALE: There are people who look at the incidents of the '90s and they say, a president of the United States cannot have a consensual relationship with an intern. The power imbalance is too great.

CLINTON: Who was an adult. But let me ask you this, where is the investigation of the current incumbent against whom numerous allegations have been made, in which he dismisses, denies and ridicules?

(END VIDEO CLIP)

BERMAN: We should note, President Trump, of course, denies the allegations. The bigger political issue here is, is there's no good answer for Hillary Clinton on this.

CAMEROTA: I don't think so.

BERMAN: But you can't get much more of a power disparity between a president of the United States and an intern.

CAMEROTA: Yes, but I have a hard time putting a 2018 lens over bad behavior in the '90s and the '80s, as we've seen so much over the past two years, because we didn't even have that language. We didn't call something a power imbalance. We didn't call relationships a power differential. That just wasn't language that we used. Now we do.

BERMAN: That's the argument she's making. Again, I don't know that that will be satisfying to people driving the Me Too movement right now because it happened.

CAMEROTA: No, for sure. I mean, listen, that's not excusing it. I just think -- I don't know what she is supposed to say at this point.

BERMAN: Well, that's the other issue.

CAMEROTA: Seeing she's still married to her husband.

BERMAN: That's the other issue. What she -- but she has to know that she does these interviews, these questions are going to get asked.

CAMEROTA: Yes.

All right, "The New York Times" reports that White House Adviser Jared Kushner has paid virtually nothing in federal income taxes for years. We break down the loophole in the law, next.

(COMMERCIAL BREAK)

[08:51:09] BERMAN: A new report from "The New York Times" details how Jared Kushner has been using a legal tax loophole, managed to pay nearly zero federal income taxes for the past five to eight years.

Joining us now is investigative reporter David Cay Johnston. He's the author of "It's Even Worse Than You Think: What the Trump Administration is Doing to America."

David, thanks so much for being with us.

This is basically an issue of the real estate business, which Jared Kushner and his family, and also the president and his family, have been deeply involved in for decades. But basically this suggests "The New York Times" going over documents that Jared Kushner probably didn't pay any income taxes because he essentially said he had real estate losses every year, correct?

DAVID CAY JOHNSTON, INVESTIGATIVE REPORTER: Correct. And, you know, I -- a tax lawyer for another big real estate family once said to me, if you're big in real estate, you're paying income taxes, you should sue your lawyer for malpractice because Congress treats real estate better than any other industry in avoiding taxes legally.

BERMAN: And, again, I should -- let me read out loud what Abbie Lowell, the attorney for Jared Kushner, says. The documents were obtained in violation of the law and standard business confidentiality agreements. However, always following the advice of numerous attorneys and accountants, Mr. Kushner properly filed and paid all taxes due under the law and regulations.

Basically saying the law was followed here. But average Americans may look at this and say, that's not quite fair, that law that allows someone making millions, if not billions, not to pay income taxes.

JOHNSTON: Oh, absolutely. If you're a homeowner, more than half of the homeowners in this country do not get to deduct mortgage interest or their property taxes. But if you buy a building with no money down, a commercial building, and you can do that if you're a well-established person in real estate, you get to write off the entire building to offset your other income. If your deduction for the year for the building is $25 million and your income is $20 million, you pay no income tax and you got $5 million to use in the future.

And that's what "The Times" shows that Jared Kushner did from the documents he had. And there's no reason for this, by the way. We don't have a shortage of real estate in this country. Imagine if we applied these rules, however, to manufacturing, maybe we'd have a more robust manufacturing center.

BERMAN: It's interesting, there was a giant, new tax law passed a year ago which closed a lot of loopholes for a lot of people. How many of these real estate loopholes were closed, David?

JOHNSTON: It expanded not only those but gave expanded benefits for private jets and many people are going to discover next winter and spring, as they have their taxes done or do them themselves, that they will be paying more money because they can't take deductions they used to get and other things.

The loophole closings, not so much. I think that's been overdone. But this is a huge change in the law of which about 80 percent of the benefits go to the 1 percent and half of them to people who make $2 million a year and up. That's the one in a thousand best-off families in America.

BERMAN: The point I was making, though, was this deduction for real estate loss. That was very much protected. That was not touched.

JOHNSTON: Oh, absolutely. Absolutely. The real estate loss was protected and, in some ways, enhanced. And, in addition, there's almost no enforcement of a common area of real estate cheating called 231 cheating that I've written about for 21 years or so. The government knows how to catch these people and yet there is no effort by any of the states or the IRS to pursue this form of cheating that costs the government, I would guess, several billion dollars a year.

BERMAN: So Jared Kushner, the president's son-in-law and senior adviser, a huge beneficiary of this tax loophole. Safe to assume that President Trump, over the years, has been as well?

JOHNSTON: Oh, absolutely. I -- so this is not a loophole. This is declared policy of Congress.

BERMAN: Right.

JOHNSTON: However, Donald Trump -- Donald Trump, remember, used an illegal tax shelter, one that was shut down by Congress within weeks -- the Republicans shut it down within weeks of learning about it. But as is usually the case when they find a tax shelter, if you already got in, they let you keep your ill-gotten gains.

[08:55:12] BERMAN: And, of course, you bring up the other "New York Times" report, which does say that the president committed fraud -- they used that word fraud -- over the years to not pay certain taxes.

As we get to the midterm elections, if the Democrats take control of even just the House of Representatives, do you think that they will seek to get their hands on tax returns of the president to look into this more? Maybe even Jared Kushner, to shine a light on this more?

JOHNSTON: Congress has had the right for forever to get tax returns. They will pull those tax returns. You'll see a thorough investigation. They're not just going to throw them out in the public record. They're going to conduct a thorough investigation. And because of the way real estate records are kept, the best area to cheat, if you do want to cheat, is in real estate. You don't want to do it in many other areas because there are electronic records that track your money.

BERMAN: Missed my calling.

All right, David Cay Johnston, thanks so much for being with us. Do appreciate it, sir.

JOHNSTON: Thank you.

BERMAN: We've got all kinds of breaking news this morning.

The president just weighing in on the controversy over Saudi Arabia and the journalist there, and Elizabeth Warren all but declaring, I think, that she is running for president. Much more ahead.

(COMMERCIAL BREAK)

[09:00:06] JIM SCIUTTO, CNN ANCHOR: A very good Monday morning to you. I'm Jim Sciutto.

POPPY HARLOW, CNN ANCHOR: And I'm Poppy Harlow in New York.

At any moment now, President Trump and the first lady are due to leave the White House for a day trip to survey the hurricane.