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Deficit Balloons Under Republican Tax Plan; New Details in Khashoggi Death; Republican Congressman Running Anti-Muslim Campaign. Aired 3-3:30p ET

Aired October 17, 2018 - 15:00   ET

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

[15:00:03]

BROOKE BALDWIN, CNN ANCHOR: You are watching CNN. I'm Brooke Baldwin. Thank you for being with me.

We start with these disturbing new details in the disappearance and apparent murder of U.S.-based journalist Jamal Khashoggi.

You should send the kids out of the room right now, because some of the details we're going to need to get into are just graphic and really, really tough to listen to.

As the evidence mounts, so too does the president's resistance in believing the Saudi government had anything to do with this. But we're going to get to that in a second here, but first just to the details just in a CNN.

Turkish media reports an audio recording of Khashoggi's killing suggests that he was tortured and then killed soon after entering the Saudi Consulate in Turkey. Turkish officials say his body was then dismembered after he was killed, and a source ads that Khashoggi may have been injected with some kind of tranquilizer.

That is the how. As for the who, sources say investigators are looking into the Saudi intelligence officer on the left side of your screen there spotlighted who allegedly led the reported torture and murder of this "Washington Post" columnist.

And that officer, according to a source, has close ties to Saudis' crown prince, Mohammed bin Salman. Turkish authorities have also released this image of a forensic specialist from Saudi Arabia. His possible presence at the Saudi Consulate in his symbol may make it hard to square that Khashoggi's death was a tall accidental.

And as we're learning all of this now, President Trump supports an investigation, but continues to defend the Saudis.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Saudi Arabia has been a very important ally of ours in the Middle East. We are stopping Iran. We're not trying to stop. We're stopping Iran.

We went a big step when we took away that ridiculous deal that was made by the previous administration, the Iran deal, which was $150 billion dollars, at one point $8 billion in cash. What was that all about? And they are an ally. We have other very good allies in the Middle East.

But if you look at Saudi Arabia, they're an ally and they are tremendous purchaser of not only military equipment, but other things. When I went there, they committed to purchase $450 billion worth of things, and $110 billion worth of military. Those are the biggest orders in the history of this country, probably in the history of the world.

I don't think there's ever been any order for $450 billion. And you remember that day in Saudi Arabia where that commitment was made. So they're an important ally, but I want to find out what happened, where is the fault, and we will probably know that by the end of the week, but Mike Pompeo is coming back. We're going to have a long talk.

(END VIDEO CLIP)

BALDWIN: Let's go first to Istanbul to David Kirkpatrick, who is there where Khashoggi was last seen. He's an international correspondent for "The New York Times."

And, so, David, what are you learning about this investigation?

DAVID KIRKPATRICK, "THE NEW YORK TIMES": Well, what we've seen today is that the government of Turkey has begun again to leak information about what it knows.

For a little while, when it seemed like President Trump was pressing for answers from the Saudis and the king of Saudi Arabia was calling the president of Turkey, the leaks here had dried up, but they have begun again.

And they are -- they are lurid. We're learning today from Turkish officials about an audiotape that contains evidence that Mr. Khashoggi was detained quickly after he entered the consulate, that his fingers were chopped off, that he was dismembered, that the gore was so egregious, that the counsel asked them to take it outside, and was told he should quiet down or meet an ugly fate himself.

And then while the body was being dismembered, a doctor who had been brought, a specialist at autopsies, put in earplugs to listen to music, and recommended that the other agents involved do the same.

BALDWIN: It's just -- it's inhumane. It is so hard to listen to some of the details. And I know you guys over at "The New York Times" are reporting out. We're working on confirming all of that here at CNN.

But just the way in which he was reportedly tortured, killed. And this news, David, about this tranquilizer, may have been injected with some kind of tranquilizer, do you know anything about that?

KIRKPATRICK: I haven't been able to confirm that detail myself. So I'm not -- I don't really want to talk about it.

BALDWIN: OK.

KIRKPATRICK: The other element that is in the news today is the growing evidence, reported mainly by our paper, that 15 of the suspects named by the Turkish authorities -- I'm sorry -- of the 15 suspects name by the Turkish authorities, four appear to have closed ties to the crown prince himself.

[15:05:03]

That is, they have traveled with him as members of his security detail. So while they may not be under his direct control, the fact that they are closely associated with him is going to make it harder and harder for him to avoid some degree of responsibility for this, for these events, for the disappearance of Mr. Khashoggi.

One of them in particular was seen with him or photographed with him in five different cities, Madrid, Paris, Houston, Boston and New York at the United Nations, always when the crowd prince was also visiting.

BALDWIN: David Kirkpatrick, reporting out of Istanbul, David, thank you.

Let's have a bigger conversation now.

I have with me CNN global economic analyst Rana Foroohar, who's a global business columnist and associate editor at "The Financial Times," and CNN senior political analyst David Gergen of Harvard's Kennedy School of Government. He has served as an adviser to Presidents Nixon, Ford, Reagan and Clinton.

And so, David, first to you.

Turkey is revealing a lot of information about this apparent murder. What is the Turks' motivation here?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: I think the Turks' motivation for a long time has been they're considered rivals of the Saudis.

And they would like to see the ISIS influence diminish. And that would open up space for them to be a larger power in the Middle East. I think that is one basic motivation. But they have also had this apparent murder take place on their soil.

So they have a they have a real motivation to figure out how it got done and make sure people know it was the Turks who did it.

BALDWIN: Have to imagine just putting pressure, all these leaks putting pressure on the Saudis to...

(CROSSTALK)

GERGEN: But pushing them -- listen, I think there's pressure now.

This investigation is being slow-walked. It's been 15 days since this fellow disappeared, 15 days, and we still don't know some fundamental facts for sure. It's time for the Turks to turn over whatever audio or materials they have to the U.S. government and to the Saudi government.

It's time for the Saudi government to tell us, who are these people, where were there, what are their alibis, whatever, but they -- the Saudis owe us a lot of information too. It's not just that Turks.

BALDWIN: What do you think?

RANA FOROOHAR, CNN ANALYST: I absolutely agree with that.

I think that it's time for our administration to get a lot more aggressive in pushing for everything you're talking about.

I mean, this is -- this is a travesty. This is something that is a major geopolitical event. I think it's actually going to have not just business ramifications, which we're already seeing a lot of high- profile business leaders having pulled away not only from the event that was going to take place, the Davos in the Desert event, in support of the kingdom, but I think politically this is going to have ramifications for the president.

(CROSSTALK)

BALDWIN: Let me just jump in and say our reporting here at CNN has been that one of Trump's senior advisers who said what Trump does could be the most consequential moment of his entire presidency, to your point.

FOROOHAR: Yes. Totally agree with that.

I mean, let's just look at who is distancing themselves from the situation. There was going to be the big of that in support of the kingdom, in supportive of Mohammed -- Crown Prince Mohammed's reforms.

Jamie Dimon has pulled out. Steve Schwarzman has pulled out. Larry Fink has pulled out. The head of Uber has pulled out, Arianna Huffington.

I mean, it's hard to think of a higher-profile group of businesspeople saying, we want nothing to do with this or this president's view about what has happened.

BALDWIN: You have -- go ahead.

GERGEN: This is this is emerging as the first crisis President Trump has had in international affairs. So far, it's been a fairly quiet -- he's not been -- navigate that way.

But this is a moment when you need top-flight people. You're talking to really serious people. And all along, there has been this fear that the Trump administration wasn't prepared for a crisis. It does seem to be at this moment -- if I'm sitting there now, say, Mr. President, let's call Henry Kissinger. Let's call George Shultz. Let's call Jim Baker. Let's call Condi Rice. Go through the list of people who would be thoughtful about this,

because I agree with the notion that what he does in the next few days could be crucial to his presidency and to the United States. We have huge interests in this part of the world.

BALDWIN: He sent over his secretary of state, Mike Pompeo, who was sent over to Riyadh. And we have pictures, right, I mean, as this man should be demanding answers. It's this photo-op with -- they're smiling.

Not only that, you have -- and, again, we don't want to criticize how much people are smiling in their Instagram photos. But I think it is germane that the spokeswoman at the State Department, Heather Nauert, is grinning ear to ear at the royal court.

And, again, do your job. Get answers. Demand the truth and don't buy the cover story.

(CROSSTALK)

FOROOHAR: Yes.

We have -- I mean, first of all, we have no Saudi ambassador. I mean there's appointments that have not been made by this administration that are incredibly important here.

I think that this is a real tipping point. We have already seen in so many ways the Trump administration pulling out of the old geopolitical order. I think that this is a moment where Europeans in particular, who, by the way, are already on trying to create mechanisms where they can do business with Iran.

[15:10:02]

They have an entirely different strategy in the Middle East. I think this was a time when old allies are going to turn and just say, this is not who we are.

BALDWIN: What message does this send the world? Where are his morals? I say that out of one side of my mouth.

At the other side of my mouth, he is saying, let's let them investigate. Do you give him credit for stepping back, even though he seems to be believing the denials? Do you give him credit for saying, let's get the facts and investigate?

GERGEN: I don't give him credit for advancing a theory that there are rogue terrorists.

(CROSSTALK)

BALDWIN: Rogue killers.

(CROSSTALK)

GERGEN: I don't give him credit for standing there and saying, we have asked for the material, if it exists. He keeps on putting that qualifier in there, as if that's the important thing.

The important thing is to get the truth and get it as quickly as possible, because this is emerging as a crisis in our -- in our relationships in the Middle East, which are crucial.

BALDWIN: Yes.

FOROOHAR: Yes.

BALDWIN: The Saudis, let's not -- we do need to remember the Saudis have been good friends for a long time, not only -- going all the way back to the days of OPEC. There have been a nation we could turn to going -- when we wanted to get -- go into Kuwait, the George H.W. Bush administration, the Saudis were pivotal for that.

And they have been helping us on Iran. So it's important to maintain that relationship, but not at the expense of our concern for human rights and our commitment to human rights.

BALDWIN: As I have been listening to you, you were talking about all the people who are pulling out of the desert in Davos, the Saudi conference coming up.

Steve Mnuchin apparently has just said -- everyone's waiting, right -- the treasury secretary and they were supposed to be deciding Friday. Now it sounds like -- Eric (ph), correct me -- you said tomorrow, he will let everyone know tomorrow -- correct -- if he goes or not.

Do you think he will?

FOROOHAR: Boy, that is a $64,000 question.

I hope he doesn't. I think that that will say a lot, if he does go. And while I agree with a lot of what David is saying, I have to push back a little bit and say I think our relationship with the Saudis has been incredibly dysfunctional, right/

I mean, it's a little like our relationship with China in the sense that each party is getting something, it's not entirely a healthy relationship. I mean, we have turned our back on the way in which the Saudis have allowed extremism to flourish in the kingdom, in exchange for an economic relationship.

GERGEN: I agree with that.

(CROSSTALK)

FOROOHAR: And I think that that reckoning is coming here.

Actually, Thomas Friedman had a wonderful piece in "The Times" about this, saying, this is the time for us to say, who are we? Are we going back people that send a hit squad into an embassy with a bone saw? I mean, really.

(CROSSTALK)

BALDWIN: ... forensic expert. I know.

FOROOHAR: This is a crisis moment.

BALDWIN: It is.

GERGEN: This is a crisis moment. There are other countries who have strongmen that we're unfortunately having to do with too.

BALDWIN: Let me hit pause on this conversation. Stick around, both of you.

There's more to talk about.

Coming up next, let the blame game begin, if Republicans lose control of the House next month. President Trump making it clear it won't be his fault, this despite telling supporters to pretend he's on the ballot.

Also, the economy is growing, but so is the ballooning federal deficit. Is the deficit still a priority for Republicans? We will tell you what the president is proposing.

You're watching CNN. I'm Brooke Baldwin.

(COMMERCIAL BREAK)

[15:17:29]

BALDWIN: All right, here's the good news.

The good news is that the economy is growing. The bad news is that the federal deficit is also growing, hitting $779 billion in 2018. Trump says he will ask each of his secretaries for a 5 percent reduction in their budgets.

(BEGIN VIDEO CLIP)

TRUMP: I'm having a Cabinet meeting a little while, and we're going to ask every secretary to cut 5 percent for next year.

And last year, first year, I had to do something with the military. The military was falling apart. It was depleted. It was in very bad shape. And that's why we went for two years, $700 billion, $716 billion. And that took place over two years in order to get the $700 and the $716 billion.

Those numbers have never been heard of before. I had to give the Democrats I call it waste money, things that I would never have approved.

(END VIDEO CLIP)

BALDWIN: As they say, there's a Trump tweet for everything.

Here's one from 2012 -- quote -- "No member of Congress should be eligible for reelection if our country's budget is not balanced. Deficit not allowed."

So, Rana and David are back with me.

And, David, you saw the tweet from 2012 to now. What do you make of the disparity?

GERGEN: Well, I was just curious. Is he going to ask for 5 percent out of the defense budget? He said every secretary.

(CROSSTALK)

GERGEN: That was his point, yes.

And he's been re-increasing it regularly. Listen, I'm glad they're looking at the deficit. I think it's very serious. We should have been looking at it long time ago. But I do think the Republicans have a substantial problem here.

They promised when they cut the taxes that it would not lead to more deficits. And now what are they doing? And Schumer and others are just driving their truck right through this argument. That is that they're saying let's take money out of entitlement programs. Let's take it out of the hands of older Americans.

BALDWIN: How likely is it that the 5 percent from each of the secretaries even makes a dent?

FOROOHAR: It doesn't make a dent at all.

And we -- the thing that is so sad is, we knew we were going to be here, right? I mean we have a terrible deficit problem in this country anyway. A tax cut at the time that the Trump administration gave it, as I have said many times on your show, was just not the right strategy.

And it went mostly to corporate America. We were told it was all going to bring back this money from abroad, and that was going to somehow hit Main Street. It didn't, Brooke. Most of it went into share buyback that jack up the price of the stock and make the rich richer.

I mean, we knew we were going to be here. And this is a terrible time to be here, because the Fed is probably going to be continuing to raise rates, which is going to make that debt expensive. And it's going to really constrict what this administration can do.

BALDWIN: This is the Rana Foroohar "I told you so" moment?

FOROOHAR: I told you so.

(CROSSTALK)

(LAUGHTER)

[15:20:03]

BALDWIN: You're right on the money.

We also heard Trump is blaming Democrats. So let me just play part of an interview with Majority Leader Mitch McConnell.

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL (R-KY), MAJORITY LEADER: It's very disturbing and it's driven by the three big entitlement programs that are very popular, Medicare, Social Security and Medicaid.

That's 70 percent of what we spend every year. There's been a bipartisan reluctance to tackle entitlement changes because of the popularity of those programs. Hopefully, at some point here, we will get serious about this.

(END VIDEO CLIP)

BALDWIN: If you look at how the deficit, though, has ballooned since Obama -- and, Rana, this is for you, you know, expected to almost double by 2019 -- what do you make of Mitch McConnell's reasoning?

FOROOHAR: Well, yes, we do have an entitlement issue.

Mitch McConnell has done nothing to address it. The Republicans have done nothing to talk about that issue until now, when they're looking for someone else to blame. Yes, we're going to have to get at some sort of midpoint on entitlements. That's not going to happen anytime soon.

In the meantime, cutting taxes, defunding the things that would actually create the growth to get you in a better place fiscally, is not the way to go.

GERGEN: Yes.

But I do think Mitch McConnell has a point about this. There is bipartisan blame here. We only have to remember Simpson-Bowles, which was the last time we have had a comprehensive and important...

FOROOHAR: It seems like a long way away.

GERGEN: Long, long way away.

But they were basically promised by the Obama administration that if they put came forward with a plan that was widely accepted, it would be put on the table and pushed by the White House. That did not happen.

FOROOHAR: That's right.

GERGEN: They ducked it. I thought it was the worst mistake of the Obama presidency.

FOROOHAR: Yes. Well, that is true.

BALDWIN: Midterms, guys, 20 whole days away. And we know that Trump told the Associated Press in an interview that he is not to blame if the Republicans lose.

And so he also recently said this about him, that this election is about him, wants people to think of him on the ballot. And this is what he said.

(BEGIN VIDEO CLIP)

TRUMP: Congress is on the ticket. And I try and tell my people, that's the same thing as me. In a sense, that's the same thing. Think of it as the same thing.

(END VIDEO CLIP)

BALDWIN: So think of it as me. But yet he's saying, if we lose, it is not my fault.

(LAUGHTER)

BALDWIN: You laugh.

FOROOHAR: I think it's a strategic mistake at this moment in time to say, think about me in advance of the midterms.

I mean, you know, we're talking about a president who hanging out with Crown Prince Mohammed, who may have been associated, looks very likely to have been associated with the brutal murder of a journalist. That doesn't make any kind of swing voter feel happier.

I think it's only going to galvanize the Democrats. They're already galvanized to begin with. It's not a good look.

GERGEN: Yes, it is interesting that the dynamics of this race could still change in 20 days.

BALDWIN: How do you mean?

GERGEN: A week ago, we never would have -- we weren't talking in a serious way about an international crisis.

(CROSSTALK)

BALDWIN: We were talking about Justice Kavanaugh.

(CROSSTALK)

GERGEN: That's right.

But then everything is moving so fast. In the next 20 days, we could have two more big issues that come up, and could swing on the margins.

But right now, it's so Trumpian to say, heads, I win, tails, you lose. You know, that's just sort of standard operating procedure. And he takes credit for everything that goes well and he puts the blame somewhere else for everything that goes badly.

He has yet -- I don't know of a single issue on which he's accepted blame. Maybe there's one I can't remember.

FOROOHAR: One of the things I'm going to be watching for really closely is whether we're going to take see kind of a head-fake deal with China in the next few weeks.

BALDWIN: Before the midterms.

FOROOHAR: Before the midterms, because Trump's been tough on China. The Chinese have been depreciating their currency. People can argue whether that's natural or manipulated.

BALDWIN: He says he has good chemistry with Xi, according to his interview on "60 Minutes."

FOROOHAR: Right, whatever that means.

But there's room now for the Chinese to cut some kind of a faux deal with Trump, maybe appreciate their currency a little bit, make him look as though he's getting a victory, a win, without really addressing any of the long-term underlying problems there.

I think that that's possibly a move in his back pocket.

BALDWIN: Something to look for.

(CROSSTALK)

FOROOHAR: Maybe I will say I told you so.

(CROSSTALK)

BALDWIN: Yes, I was about to say, having deja vu all over again for the future.

Rana and David, thank you both so much. Appreciate that conversation.

(CROSSTALK)

BALDWIN: Coming up next here: Republican Congressman Duncan Hunter fighting federal charges of misusing campaign funds, while also fighting for his reelection.

Hunter now is accused of running an anti-Muslim campaign against his Democratic challenger, suggesting he has ties to terrorism. We have those details ahead.

(COMMERCIAL BREAK)

[15:25:13]

BALDWIN: Indicted Republican Congressman Duncan Hunter is now running a brazenly anti-Muslim smear campaign against his opponent, a Democrat by the name of Ammar Campa-Najjar.

Hunter, a hard-charging Marine pleading not guilty to charges of using more than $250,000 in campaign contributions to fund a lavish lifestyle, a new Hunter campaign flyer accuses his opponent of being a -- quote, unquote -- "national security risk" and includes a 9/11 photo.

Campa-Najjar was granted a security clearance when he worked for the Obama administration. He is of Latino and Palestinian descent.

And here is part of his response -- quote -- "Well, Mr. Hunter's ongoing attacks on me, my wife and the Justice Department aren't just political. They're pathological. Voters will judge us by our own merits, character and record this election. May the better man win."

So, let's go to Maeve Reston, who's following this race for us.