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Mnuchin Pulls out of Saudi Conference; U.S. Gives Saudis More Time; Trump's Focus on FBI Building; O'Rourke and Cruz Step Up Attacks. Aired 1-1:30p ET

Aired October 18, 2018 - 13:00   ET

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

[13:00:00] JOHN KING, CNN ANCHOR: As we go, to Jonah Eatman (ph) for all his hard work on this program. We wish him luck. He's got a great new job in New York.

Have a great afternoon. "WOLF" starts right now.

WOLF BLITZER, CNN ANCHOR: Hello, I'm Wolf Blitzer. It's 1:00 p.m. here in Washington. Thanks very much for joining us.

The White House folding under intense pressure, announcing the Treasury secretary, Steve Mnuchin, will not attend a major summit in Saudi Arabia following the apparent killing of Saudi journalist and U.S. resident Jamal Khashoggi.

Mnuchin tweeting just a little while ago, and I'm quoting now, just met with President Trump and Secretary Pompeo and we have decided I will not be participating in the Future Investment Initiative Summit in Saudi Arabia, closed quote. Secretary of State Mike Pompeo met with President Trump earlier this morning to brief him on his meetings with Saudis and with Turks. He suggested waiting until the Saudis complete their own investigation before jumping to any conclusions. Listen to this.

(BEGIN VIDEO CLIP)

MIKE POMPEO, SECRETARY OF STATE: I told President Trump this morning that we ought to give them a few more days to complete that so that we, too, have a complete understanding of the facts surrounding that, at which point we can make decisions about how or if the United States should respond to the incident surrounding Mr. Khashoggi.

(END VIDEO CLIP)

BLITZER: Joining us right now, our senior White House correspondent Pamela Brown.

Pamela, Secretary Pompeo saying to wait and see. Mnuchin, yet, is pulling out of the summit. Do we see what's going on behind the scenes, the thinking over at the White House?

PAMELA BROWN, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, Wolf, we've learned from speaking to White House officials that there were a number of factors that were at play in deciding to pull Steve Mnuchin out of the Saudi Arabia conference. Chief among them was the fact that his European counterparts, particularly in France, as well as the U.K., decided to pull out. And so the decision was made between the president, Secretary Pompeo and Steve Mnuchin that it would be best for him to no long go to this conference. But, clearly, they were engaged in a wait-and-see approach. They wanted to see what other countries would do, what other business leaders would do.

I can tell you that Steve Mnuchin spoke on the phone a few days ago to business leaders who decided to pull out and they were encouraging him that he shouldn't go. But the president really wanted to wait and see what other countries did. And now that it's clear what is happening, other countries pulling out, they made the decision that he shouldn't go.

But this comes, as we just heard from the Secretary of State Mike Pompeo, that they want to essentially by time for Saudi Arabia to conduct an investigation into what happened to Jamal Khashoggi.

Of course this raises the question, if Saudi Arabia is responsible for his disappearance and apparent death, as mounding evidence suggests, how can they be trusted to conduct a fair investigation? Here's what the secretary of state had to say about that.

(BEGIN VIDEO CLIP)

QUESTION: Why should Saudi Arabia be trusted to conduct a fair and impartial investigation when they're accused of the disappearance and apparent murder of Jamal Khashoggi?

MIKE POMPEO, SECRETARY OF STATE: We're all going to get to see the work product. We're all going to get to see the response that the kingdom of Saudi Arabia takes with this. When we see that, we'll get a chance to determine -- all of us will get a chance to make a determination with respect to the credibility and the work that went into that, whether it's truly accurate, fair, transparent in the very way that they made a personal commitment to me and the crown prince also made a personal commitment to the president when he spoke to him I believe it was night before last.

(END VIDEO CLIP)

BROWN: Mike Pompeo went on to say that Turkey is also conducting an investigation and so between the two investigations we will see a complete picture, but, of course, that raises the question, Wolf, particularly given the strained political relationship between the two countries, what if the investigations reach different conclusions, what then will the administration do?

Wolf.

BLITZER: Yes, he also went out of his way to point out, as you know, Pamela, that the U.S., since the 1930s, has had a very, very strong, strategic cooperation arrangement with the Saudis in fighting terrorism and in other areas. Clearly that's weighing very heavily on the Trump administration's attitude. BROWN: Right. And you've heard the president say repeatedly that we

need Saudi Arabia, particularly when it comes to the arms deal, which is clearly very important to the president, as you pointed out, the fight against terrorism, when it comes to Iran and other important priority for the president. It is very clear that the president does not want to jeopardize this partnership with Saudi Arabia.

Wolf.

BLITZER: All right, Pamela Brown, thank you very much.

President Trump's end-of-the-week timeline for the Saudi investigation was apparently a little overly ambitious. Here with us now, Maryland Senator Chris van Hollen. He's a Democrat. He's a member of the Appropriations Committee.

Senator, thanks so much for coming in.

SEN. CHRIS VAN HOLLEN (D), MARYLAND: Good to be here.

BLITZER: So do you trust what the Saudis will come up with in terms of their investigation?

VAN HOLLEN: Not at all. Zero. After all, the Saudis said they knew nothing about what had happened at the consulate in Istanbul. In fact, they had said that Mr. Khashoggi had actually left the consulate when they knew full well what had happened to him. And so to say to the Saudis, OK, you do an investigation, when they've already proven themselves to be untrustworthy on this issue, makes no sense.

[13:05:11] We should be listening to our own intelligence agencies. And as you know from public reporting, our intelligence agencies are increasingly confident that the crown prince himself is culpable here.

BLITZER: Mohammad bin Salman, are you hearing anything different than that privately in term -- because I know you have access to sensitive information.

VAN HOLLEN: Well, I know that Senator Corker, who's the chairman of the foreign relations committee, has asked for an intelligence community briefing. He just said the other day that they had -- they, the administration, was not cooperating and not providing it. So it appears you've got an administration that wants to shut down our own intelligence agency and not let them tell members of Congress what's going on so that President Trump can continue to be the mouthpiece, which is what he's become, for the Saudi regime and its denials. It's really an outrageous situation.

BLITZER: Because earlier in the week he was already suggesting this could have been the work of what he called rogue killers.

VAN HOLLEN: Exactly. I mean he was essentially doing the work of the Saudi regime, spreading this other theory that they wanted out there, which was clearly crazy given all the facts that we already know about and are mounting daily. And so why not allow the U.S. intelligence agencies to come down and brief members of Congress? Why shut them down? The only reason for that is because our intelligence agencies can put together the facts, which are pretty clear here, that this could only have happened with a green light from the very top. And if not the king, the crown prince, who's running day to day operations in Saudi Arabia.

BLITZER: And this one theory that -- I don't know if the Saudis are going to go forward with it in terms of their conclusion that, yes, he was brought in. He was interrogated. But the interrogation, you know, went wrong and unfortunately he died.

VAN HOLLEN: Yes, well, you don't know why they brought along a bone saw. As we know, the Turkish authorities are reporting that they had an autopsy expert and brought in a bone saw. You don't really do that just to have a conversation with somebody.

BLITZER: So your suspicion was, when he was lured into the consulate in Istanbul, they were going to kill him?

VAN HOLLEN: Well, what we know is this, Wolf. We know that the Saudis were already trying to lure Khashoggi back to Saudi Arabia. That didn't work. Then they knew that he was going to come visit the consulate in Istanbul. They had days' notice and, you know, they had their two jets fly in and they had members of the crown prince's security detail on the ground.

We also have the recordings, transcripts or recordings that have been released --

BLITZER: According to the -- according to the Turks.

VAN HOLLEN: According to the Turks. According to the Turks.

BLITZER: But are you suggesting those recordings were provided by the U.S. by the Turks?

VAN HOLLEN: I don't know exactly who provided them. And I do think it's important that Turkey present all the evidence it has. I do worry about Turkey also trying to use the information it has to leverage something they want.

BLITZER: From the Saudis?

VAN HOLLEN: Out of the Saudi government.

BLITZER: Because, as you know, the Turks and the Saudis don't have necessarily a great relationship. They're rivals right now. And the Turks have been leaking a lot of damning information about what the Saudis supposedly did.

Can you trust the Turks in terms of their own investigation?

VAN HOLLEN: Well, I think we have to see what the Turks have. But what we know from, for example, the airplanes and those sort of facts, I think has been corroborated by others.

Now, you're right, the recording themselves and the transcripts of those recordings, we'll have to -- have to see. But this is, again, why not let U.S. intelligence brief members of Congress? The only reason not to allow that is because you're worried U.S. intelligence is going to tell members of Congress what they know and it's inconsistent with what the president of the United States is saying publicly.

BLITZER: As you know, the president's son-in-law and senior adviser, Jared Kushner, has had a very, very close working relationship with the Saudi crown prince, Mohammad bin Salman, and spoke with him on the phone on this very sensitive issue, but he's sort of been silent ever since Pompeo went over there and didn't take Jared Kushner along with him.

What is the role of Jared Kushner in all of this?

VAN HOLLEN: Well, you're right, Jared Kushner has been involved from the beginning. Was on that very first trip that they took. They put all their eggs in the region in the Saudi basket despite ample warnings about the crown prince here. I mean the crown prince had locked up a lot of businesses, manufactured a fight with Qatar. We know that they've got a horrendous war going on in Yemen. Hey, they kidnapped the prime minister of Lebanon at one point. There were lots of flashing red signs that this was a reckless individual to be doing business with, but they ignored ate all.

Look, I don't know all the reasons. Obviously Saudi Arabia has been an important ally. It's also a fact that the Saudi government has spent a lot of money in Trump hotels here in the United States, taking some of them from being, you know, losing propositions to winning propositions. There are lots of factors to be untangled here. Our job as the United States is not to follow other countries, like we're doing, it's to stand up and speak out about human rights and just say that it's unacceptable to go murder in cold blood a U.S. resident with American citizen children who's a columnist for "The Washington Post." Playing along the Saudis and being their mouthpiece, as the president has, really undermines our security interests around the world.

[13:10:29] BLITZER: Senator Chris van Hollen, thanks so much for joining us.

VAN HOLLEN: Thank you.

BLITZER: Appreciate it.

There are new details emerging about a battle over the future FBI headquarters here in Washington, D.C. How the piece of real estate intersects with both the Trump business empire and his presidency.

Plus, President Trump is getting plenty of company from potential 2020 foes out there on the campaign trail as a slew of Democrats begin hitting the ground ahead of the midterms.

And setting the record straight. Senator Elizabeth Warren's DNA test results spark major backlash, but was it warranted? We'll check the facts later this hour.

(COMMERCIAL BREAK)

[13:15:26] BLITZER: The FBI's famous J. Edgar Hoover Building is now at the center of a running debate over whether President Trump's business holdings create a possible conflict of interest while he serves in office. For years officials have debated plans to turn the FBI's crumbling headquarters here in Washington over to a commercial developer who could demolish it, building something new and, in return, give the FBI a state-of-the-art campus somewhere else around the nation's capital. But the Trump administration killed that plan early on in favor of building on the existing site. And now newly released government e-mails show the president was directly involved with the decision, which critics say could have financial benefits for the president since his hotel is located just across the street, only a block away.

In addition, "The New York Times" reports that as far back as 2015, an executive at the Trump company expressed concern that the redevelopment could -- would create potential competition for the Trump International Hotel on Pennsylvania Avenue here in Washington.

Joining us now, former Obama White House Ethics Counsel and author of "The Last Palace," Norm Eisen.

Norm, thanks very much.

I know you're working on various lawsuits involving the president and his deals, but what do you think of this report, this latest report, that suggests that the president was personally involved in the decision to kill this notion of selling the FBI building to a developer, who would then demolish it, build new buildings, retail space, office space, condominiums, a hotel and move -- and build a new FBI headquarters out in the suburbs?

NORMAN EISEN, CNN CONTRIBUTOR: Wolf, thanks for having me back.

And it's a very troubling report in "The New York Times" because what it suggests is that the president is, as we contend yet again, perverting his office and the powers of that office to line his own pocket. And here's the problem with this report, Wolf, it makes it seem like the president doesn't want to have competition on that FBI site. Everyone agrees it makes sense for the FBI to move off campus, but that would open up the property potentially to another hotel. That Trump would jeopardize the best needs of the FBI and so our national security and law enforcement to avoid competiiton for his hotel if it's true, reprehensible.

BLITZER: Because, as you know, "The New York Times" report note that there's no clear indication -- let's say that the original plan to go ahead and raise the FBI building, sell the property to a commercial developer, build office space, retail space, a new hotel, condominiums, that that necessarily would hurt the Trump International Hotel across the street and potentially could increase the value of that hotel because of this new development.

EISEN: Well, apparently the president doesn't see it that way. And here's what's also disturbing about it, Wolf, and my watchdog group has demanded documents under the Freedom of Information Act to understand it. The government won't turn over the information on the president's exact reasoning. But the only thing that makes sense when you understand these new facts in "The New York Times" editorial, why would you trap the FBI on the premises, deny them a proper campus somewhere around Washington, D.C., while this construction is going on, other than for Trump to benefit his hotel? So it's a very disturbing set of facts and we need to see these documents. Why is the president doing this?

BLITZER: Well, if the Democrats get the majority in the House of Representatives and have subpoena power, what happens then?

EISEN: Well, I think that this is going to be a top issue for the Democrats because the Trump Hotel, as you mentioned, I'm involved in litigation about that hotel. The Trump Hotel is a nexus for the improper influence that seem to be affecting the president's decision making. We're talking about Khashoggi all this week. There's a lot of Saudi money that comes through that hotel, other international and domestic money. As you know, it has constitutional dimensions. I and others contend the president's constitutionally forbidden from taking those money. Now we see he may be jeopardizing the best interests of the FBI in order to benefit his hotel.

BLITZER: And your lawsuit against the president is that, what, he should have divested himself from any interest in the hotel?

EISEN: Exactly so. The Constitution contemplates that a president should not have commercial enterprises that allow him to get benefits from the federal government, state governments or foreign governments because of this conflict, Wolf. It's as if the framers of the Constitution knew that someday the president may be leasing a hotel from the federal government. It may compromise his decision making. He shouldn't be doing it. So we're contending that it's improper for him to keep an interest in this hotel. He should have set up a blind trust, given it to others.

[13:20:26] BLITZER: We'll see how that lawsuit works out.

Norm Eisen, thanks very much for coming in.

EISEN: Thanks, as always, Wolf.

BLITZER: All right, Joe Biden, Bernie Sanders, Kamala Harris, Cory Booker, all canvasing the country right now to campaign for the midterm candidates and also campaign potentially to lay the groundwork for their own presidential bid.

Plus, with less than three weeks to go, Beto O'Rourke is on offense right now as he races the clock in the closely watched Texas Senate race. We'll go live to the lone star state when we come back.

(COMMERCIAL BREAK)

[13:25:38] BLITZER: The 2020 presidential election season may seem a long way off, but some of the biggest names in Democratic politics are already descending on states that will be crucial in the race against President Trump.

Just take a look at the map. Today and over the next couple of days, potential Democratic presidential candidates are crisscrossing, look at this, South Carolina, New Hampshire, Iowa, Nevada, Indiana, and Michigan. A recent CNN poll found that former Vice President Joe Biden is the Democrats' top choice to face off against President Trump, followed by Senators Bernie Sanders and Kamala Harris. It may be the most watched Senate race in the country right now. And we're talking about Beto O'Rourke versus Ted Cruz. It's a Texas showdown that's reached a new level of mean within the past -- with only 19 days to go in the campaign.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Beto O'Rourke wants to be a senator.

BETO O'ROURKE (D), TEXAS SENATE CANDIDATE: (EXPLETIVE DELETED).

UNIDENTIFIED MALE: So he's showing up across Texas sharing his whit.

O'ROURKE: How (EXPLETIVE DELETED) up is that?

UNIDENTIFIED MALE: His wisdom.

O'ROURKE: What the (EXPLETIVE DELETED) are these guys doing?

UNIDENTIFIED MALE: Somebody left something on my door the other day and it said Ted Cruz, tough as Texas. I mean, come on. If somebody called my wife a dog and said my daddy was in on the Kennedy assassination, I wouldn't be kissing their ass.

(END VIDEO CLIP)

BLITZER: Joining us now from McAllen, Texas, our chief political correspondent and the moderator of a CNN town hall tonight with Beto O'Rourke, our own Dana Bash.

We should note, Dana, that CNN invited Senator Ted Cruz multiple times to appear tonight in his own town hall, but he declined.

All right, so let's get to the questioning, Dana.

While this race is getting nasty, is it too little too late for Beto O'Rourke?

DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: Well, you know, it's an open question. O'Rourke certainly has been outperforming any Democrat in terms of the polls for -- for, you know, for a quarter of a century. I mean that is how long it has been since a Democrat has represented Texas in -- even longer than that -- in the United States Senate or even won statewide. And so that is something to keep in mind.

Now, it is true, if you look at this latest CNN poll, Ted Cruz is ahead by a pretty healthy margin, 52 to 45. And O'Rourke was closing in a little bit more than that a couple of months ago. The question is whether or not Ted Cruz is pulling ahead and can't beat -- you know, and O'Rourke can't catch him or not. And O'Rourke really is trying to bank on the fact that he has this national notoriety, that he has this unbelievably huge war chest, Wolf, $38 million just in the last quarter. I mean that is record setting plus-plus. And so it's an open question whether or not he -- there are enough potential Beto O'Rourke voters, even to spend that money on. He is banking on, yes, he's banking on his outreach to millennials, to independents and to perhaps a growing Hispanic community, although it is a big open question whether many of them even want to go for somebody like O'Rourke or feel more comfortable with Ted Cruz. And if the polls show -- if it goes the way history has shown, it could be Ted Cruz.

BLITZER: Yes, Senator Cruz will be campaigning, as you know, Dana, in Texas with President Trump later this month. The two, obviously, have had a rather tumultuous history, to put it mildly. Watch this.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: L-y-i-n apostrophe. Lyin' Ted.

SEN. TED CRUZ (R), TEXAS: The man cannot tell the truth but he combines it with big a narcissist.

TRUMP: He's a nasty guy. Nobody likes him. Nobody in Congress likes him. Nobody likes him anywhere once they get to know him.

CRUZ: Donald does one of four things -- he yells, he screams, he curses or insults.

TRUMP: I think he's crazy. Honestly, I think he's crazy.

CRUZ: Donald, you're a sniveling coward and leave Heidi the hell alone.

(END VIDEO CLIP)

BLITZER: All right, so what happened, Dana? Is that all water under the bridge right now? They're going to be campaigning together.

BASH: It is and it has been, at least in public, since the president was inaugurated. Ted Cruz has been aggressively trying to work with the president on a number of issues. They differ on things like tariffs. But, by and large, they have been trying to work together.

[13:30:01] And you played the ad that Beto O'Rourke has out there. This is something that O'Rourke is using. He's -- lack of a better way to say it, questioning Cruz's manhood, saying, how can you do this?