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INSIDE POLITICS

Mueller Team Asked Kelly Questions; Mueller to Make Filing Regarding Cohen; Trump Nominates Barr; November Jobs Report. Aired 12- 12:30p ET

Aired December 7, 2018 - 12:00   ET

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


[12:00:00] ANA CABRERA, CNN ANCHOR: You all for being here with me on this Friday. "INSIDE POLITICS" with John King starts right now.

JOHN KING, CNN ANCHOR: Welcome to INSIDE POLITICS. I'm John King.

We begin this hour with important breaking news, putting the Russia special counsel probe deep inside the West Wing. In recent months, we are told, Robert Mueller's investigators interviewed the White House Chief of Staff, John Kelly. Sources describing the questions as narrow. That he was interviewed add context to what we know is a deteriorating relationship with his boss, the president. Kelly is said to leave the White House in the coming days, sources tell CNN. Sources also tell us he's no longer on speaking terms with the boss.

Let's first focus on the special counsel part of this news today.

CNN's Evan Perez here to provide reporting and insight.

So, Evan, what do we know about the special counsel's questions for John Kelly? What did Robert Mueller want for him?

EVAN PEREZ, CNN SENIOR JUSTICE CORRESPONDENT: Well, these were a narrow set of questions that were chiefly having to do with the obstruction of justice part of the investigation, John. They wanted to have Kelly essentially corroborate testimony that they had already received from Don McGahn, the former White House counsel.

There was an episode inside the White House after one of the stories that emerged that said that the president had tried to get Don McGahn to essentially order the firing of Special Counsel Robert Mueller. And the president was angry about the news stories and he wanted Don McGahn to go out there and refute the stories. He refused. And so Kelly was witness to some of this. And so that's what the meat of this interview was about, was essentially for Kelly to come in and corroborate what the special counsel already had from its own interviews, from its own information, as part of the obstruction investigation.

KING: And this gets into a very tricky constitutional question. The president's chief of staff, executive privilege. You're in meetings at the White House. So did the White House say, hey, this is great, or did the White House push back? PEREZ: Oh, no. When the first -- when the first request was made

earlier this year, the White House, Emmet Flood, the White House counsel, refused. He said, no, this is off limits. As you know, one of the things that they'd said was that the special counsel, Robert Mueller, is not allowed to delve beyond the inauguration. And so one of the things that they tried to do was essentially narrow the scope of this interview, which is what ended up happening.

We're told by a source that essentially Emmet Flood said first you have to prove that this is necessary and you have to prove that you can't get this information from anywhere else. And so that's, in the end, what ended up happening.

We're told that Kelly went in and did this interview with the special counsel's office and it hasn't been back.

KLING: Hasn't been back since. A narrow set of questions.

Stay with us. We want to discuss it more.

This news breaking on a day where we're also told that John Kelly's days, hours at the White House, may be numbered.

Let's bring in Kaitlan Collins, live at the White House.

Kaitlan, what do we know?

KAITLAN COLLINS, CNN WHITE HOUSE CORRESPONDENT: Well, John, we know that John Kelly is expected to resign in the coming days and leave the West Wing after a tumultuous 17 months. And now with the headlines that John Kelly has been questioned by Mueller's team, he is only further out in the news today. Not a place that the chief of staff likes to be.

But we're told that even though the president and John Kelly have had this up, down, back and forth relationship for some time now and John Kelly has been on the verge of being fired or resigning multiple times before, we're told, John, that this time is different because his relationship with the president has deteriorated so greatly that the two men are not on speaking terms. Yes, they've been in the same room for some meetings, yes, they've been in the Oval Office, but they have not been speaking one on one to each other and that is a sign of just how bad things are.

And President Trump realizes that and he also is looking ahead to the next two year and the Democrats taking over the House in Washington just in come January and he wants to be able to have someone in that position who can help him shape the last two years of his first term. And he doesn't feel that John Kelly is the person for the job.

Now, the president is traveling to Kansas City today. And we should note that the chief of staff, John Kelly, did not travel with him and he is not in his office in the West Wing either.

John. KING: Kaitlan Collins at the White House. That sounds like the very definition of dysfunction, the White House chief of staff who's not on one-on-one speaking terms with his boss, the president. Kaitlan, appreciate the reporting.

Evan Perez still with us here in studio. Also joining us, as we continue the conversation, CNN's Pam Brown and Michael Zeldin, former federal prosecutor who was Robert Mueller's special assistant at the Justice Department.

Let's come back to this -- where how this -- there's a lot of pieces.

PEREZ: Right.

KING: And one of the challenges in trying to cover this investigations is we're going to see memos filed today about Michael Cohen. We're going to see memos filed today about Paul Manafort. We have this news now that John Kelly sits down as part of the obstruction investigation.

Bob Mueller has been very good at giving us crumbs. And it's really hard to see the bakery, if you will, and put this all together.

PEREZ: Right.

KING: So I want to stick with John Kelly for one second in the sense that -- so they come to a president of the United States. It's the president's decision in the end. The special counsel wants to interview your chief of staff.

Michael, let me start with you and the legal question of that.

The president has every right, whether you like or dislike the president, whatever your politics, the president has every right to have a small group of people with whom he can get private advice. How do you make the case as a prosecutor that I have the right to this information?

[12:05:13] MICHAEL ZELDIN, CNN LEGAL ANALYST: So, the president has the right to withhold testimony that implicates executive privilege, or deliberative process privilege. So if the communications are about policy matters that the chief of staff is providing the president, then that's the basis for executive privilege. If it's not that, it's not as easily established.

What Evan said is very interesting to me, which is that they initially resisted the testimony, but they said, we'll give it to you if you can establish the two standards of ESPY (ph), that it is necessary and you can get it from nobody else. And apparently Mueller satisfied that because they made Kelly available.

If Mueller is able to meet that standard as to Kelly, then one has to wonder, why can't he make it, if he hasn't already, as to anybody else he wants to interview and does that mean that down the line the president resists a subpoena for testimony and EPSY (ph) has been already met and they get to talk to the president. KING: ESPY (ph), a case of previous precedent in this matter.

And so we're waiting today to see key documents about Michael Cohen, key documents about Paul Manafort. The question, let me start with Manafort. The question there is, Robert Mueller says, this guy cut a plea deal. He promised to cooperate. Then he lied to us. And we said, we know you're lying, and he continued to lie to us.

We -- what we don't know is, are these lies about the pre-Trump Manafort world, for which he was put on trial for, essentially sleazy lobbying and not disclosing money and hiding money and the like, or is it in Trump land, once he becomes chairman of the campaign. We don't know the answer to that question, right?

PAMELA BROWN, CNN SENIOR WHITE HOUSE CORRESPONDENT: No, we certainly don't. And that is the key question here, were his lies, according to Mueller's team, having to do with the president, the Trump campaign, any dealings with Russia during that time frame, or was it before his dealings with Ukraine or Russia.

Now, what is significant is, my colleague, Dana Bash, spoke to Rudy Giuliani today, who said that -- and we reported that Manafort's team has been in contact with the president's lawyers and they -- and he told Dana that in the meetings between Manafort and Mueller's team, that Mueller's team believed he was lying on issues relating to the president, particularly as it pertained to the Trump Tower meeting and the president's knowledge of it. Manafort had denied that the president had any knowledge that his son, Don Junior, was meeting with Russians at Trump Tower.

And so, according to Rudy Giuliani, that is something that Mueller's team has made clear, that they do believe Manafort has lied to issues pertaining to the president. But the question is, will that be in the court filings today? We know from the Flynn filing there were a lot of redactions, which just led to more questions than answers. So we shall see if we will gain a better understanding of the Russia investigation and what Paul Manafort was lying about according to Mueller's team today in these filings.

KING: Right, because one of the things that we learned from Michael Cohen, and we'll see what new materials we get here, is that Michael Cohen now says that they were all lying. That the conversations about Trump Tower Moscow went on into at least June of the presidential campaign year. Everyone else had previously said, including people who speak for the president, that they ended around January. So he's becoming a more serious candidate and their narrative was he's becoming a more serious candidate. Iowa's about to vote. Stop. Let's be a presidential candidate, block out the business, we can't do that, can't do that. Now we find out, according to Michael Cohen, and documents that Bob Mueller files to support that, it went on until at least June.

I want you to listen -- this is Alan Dershowitz, noted appellate attorney, expert, who, on these matters, sometimes he's critical of the president. When it comes to the Mueller investigation, he tends to support the president. Listen to him here making the case that if that's all that happened, no big deal.

(BEGIN VIDEO CLIP)

ALAN DERSHOWITZ: Collusion is not a crime. And even if he was building a tower, what's the evidence that he gave anything in return for that? They're not crossing the line from what some people might regard as political sin to federal crime.

(END VIDEO CLIP)

KING: Number one, is that right in the sense that if you're an active candidate for president, and you're trying to build a Trump Tower, and allegedly part of your sweetening to get clearances will give Vladimir Putin a $50 million penthouse on top of Trump Tower Moscow, is that not in and of itself a crime? And to the broader point is, is Paul Manafort lying about the Trump Tower meeting? What happened? Why did they water down the platform at the Republican Convention? That's the pieces, the dots, if you will, that Mueller has yet to connect for us publicly.

ZELDIN: That's right. So starting with the Trump Tower. If it was the case that anyone in the Trump Organization said to Russian licensing authorities, if you give us the license to build this tower, we will give you a $50 million penthouse. That is textbook Foreign Corrupt Practices Act violation. It is illegal flat out.

KING: For anybody?

ZELDIN: For anybody.

KING: You don't have to be a candidate for president?

ZELDIN: Correct.

KING: Because he's the -- because Vladimir Putin's a head of state. You're buying -- you're trying to buy the government.

ZELDIN: You're buying -- exactly. Exactly.

Now with respect to collusion not being a crime, technically it's not a crime, except in the anti-trust area. But coordination with foreign nationals to deliver something of value and/or conspiracy to interfere with the functioning of the Federal Election Commission are both crimes. And so it there is underlying evidence that the parties did either of those things, then there is crime there. And that's what Mueller is mandated to investigate. And we'll see what he says about it.

[12:10:29] KING: CNN's MJ Lee has been tracking this Cohen reporting, which is fascinating.

MJ, we're waiting for another filing today. What is the anticipation?

MJ LEE, CNN CORRESPONDENT: Well, John, obviously the big headline is going to be what recommendation Robert Mueller makes on how much jail time, if any, Michael Cohen should get. But it's also the context around this that is potentially going to be newsworthy because, remember, Michael Cohen is kind of banking on his cooperation with various investigators to be his lifeline. His lawyers have tried to sort of paint this picture of a man who has come around, has come to his senses, and is now very eager to cooperate with the government to try to help them get to the truth on what happened and his dealings with President Trump.

And as a part of that, they're making the argument for Michael Cohen to get no jail time when the sentencing happens next week.

Two areas that we're watching particularly closely is whether we get any new insights from Robert Mueller on two areas where Michael Cohen has already pleaded guilty. Remember, it was back in August that Michael Cohen pleaded guilty to eight criminal counts, including two counts of finance violations -- campaign finance violations. And as a part of that, he dropped this big bombshell in which he said it was at the direction of the president that he coordinated these huge payments to two women who alleged to have affairs with Donald Trump.

And then it was also last week that he also pleaded guilty to lying to Congress about this Moscow deal in which the Trump Org. was having discussions about whether to do a building project in Moscow and Michael Cohen is now saying those conversations were actually more extensive and went on for longer than he had previously admitted.

So these are all areas where we could, again, potentially get some new information and insight from Robert Mueller. And, of course, from Michael Cohen's perspective, he is very much hoping that by pushing for this quicker sentencing, because he could have asked for this to be potentially delayed under a more traditional cooperation deal, he made it clear that he wants this to go on as originally planned next week because he is very, very eager to move on with his life.

John.

KING: And we will see what the filing is later today. Everybody stay with us. A lot of pieces to try to put together, including on this day when we learned new developments in the investigation. We also know the president has a new choice to be the attorney general who, ostensively, would oversee the special counsel investigation.

We'll be right back.

(COMMERCIAL BREAK)

[12:17:01] KING: Welcome back.

In the context of the new news today about the special counsel investigation, important to note the revolving door at the White House still revolving in an important way. President Trump finally unveiling his new pick for attorney general, tapping William Barr to fill the role left vacant by Jeff Sessions, who, you'll remember, was fired by the president back in early November. President Trump says it's a new relationship, but that he's a big fan of what he hopes will be his next attorney general.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: A terrific man. A terrific person. A brilliant man.

I did not know him for -- until recently when I went through the process of looking at people. And he was my first choice from day one. Respected by Republicans and respected by Democrats.

I think it will go very quickly. And I've seen very good things about him, even over the last day or so when people thought that it might be Bill Barr.

(END VIDEO CLIP)

KING: Now, Barr has held the position before. He was attorney general under President George H.W. Bush. During that time, he also served, welcome to Washington, as Robert Mueller's boss at the Justice Department when Mueller, back then, was leading the criminal decision.

Sources telling CNN, Barr was initially reluctant to return to federal government service, but that prominent Republican lawyers pushed Barr to accept if he was offered the job, they argued to him, it was good for the institution. Barr has offered mixed reviews for Mueller's current investigation into Russia meddling into the election.

So it's a return of an old Republican establishment figure, but somebody -- we were talking before the program, Michael, a federalist society Republican. Someone who has sweeping views of presidential power. Assuming he gets confirmed, relatively short order, Democrats have said nice thing, if Robert Mueller said, I want to subpoena the president of the United States, is Barr someone who would say go ahead or because of his views of executive power would he say, no, the president can stop you?

ZELDIN: I think that Mueller is going to have a tough road, if you will, to convince Barr of the need for a subpoena. I think that he's convincible, but I think he starts from the proposition that you don't need this unless you can really demonstrate no other source of evidence, ongoing criminal investigation, critical evidence to this. It's just the nature of a conservative jurist as is Barr.

So I don't know that that's a good thing for Mueller, unless Mueller, of course, has the evidence to convince Barr. The good thing about Barr is, he's convincible. He's a lawyer. He is not a politician.

KING: He's a lawyer, not a politician.

And here's what he said, this is back in May 2017. Now, remember, he was Bob Mueller's boss. Knows him well from the Justice Department. This is what he said to "World Magazine."

His appointment is good news. I am confident Mueller will keep his eyes on legitimate areas of inquiry and not let his investigation degenerate into a sprawling, ceaseless witch hunt -- funny he used that word -- to get something on the president's associates. That's what he said. That's May in 2017. But here's what he said just a month later to "The Hill" newspaper. Barr also called the obstruction investigation asinine and warned that the special counsel risks taking on the look of an entirely political operation to overthrow the president.

[12:20:02] So, which is it?

PEREZ: Look, I think -- I think Bill Barr is like a lot of conservatives. I think they're nervous about exactly where this is going. And I think you're seeing that in some of his comments that he's -- some of the interviews that he's given. But I can tell you this, I mean, talking to conservative lawyers, you know, they're thrilled about this. People inside the Justice Department, career people and political appointees, are relieved.

John, I've got to tell you, inside the department right now, the dysfunction of having an acting attorney general and a deputy attorney general who really don't trust each other, right, this is a fourth and fifth floor of this building where there is no trust right now. Having a Bill Barr come in, somebody who is known, a known quantity come in and help restore the department and its reputation, has a relationship with the president, right? This is somebody who supported the president, even though he's an establishment figure. I think they feel he'll do wonders just to try to repair the relationship which has been broken for many months.

KING: Right.

BROWN: And Rosenstein has already come out lobbying the announcement, of course, the deputy attorney general.

It is interesting, though, in talking to some of Trump's allies, they're not too happy about this pick, some of them at least. They feel like he is too much of an establishment figure, too aligned with, you know, Bush and those views and they just feel like he's someone who isn't aligned with the president when it comes to immigration and other issues. So it will be interesting to see how this all plays out.

KING: But it's fascinating to me because he's not a Trump person.

BROWN: Right.

KING: And then we know the president, his critical of Jeff Sessions was, the president -- this president's view of an attorney general is, he's supposed to be his guy, his political guy. He's supposed to be loyal. He never should have recused himself. He should have -- and he should have shut down the Robert Mueller investigation. That's what President Trump thinks the attorney general is supposed to do.

Bill Barr, office of legal counsel, served as attorney general, came up through the ranks, if you will, he knows what his job is supposed to be, which is, yes, you're a presidential appointee, but your job is to be -- your fidelity is to the Justice Department, the Constitution, the law, not the man, the president. He worked -- Mueller worked for him and also at that time Pat Cipollone, who's about to become the president's legal count --

PEREZ: Right.

KING: Worked for him. Connect the dots for me here. How's this work?

ZELDIN: Well it's, welcome to Washington. So Mueller was the assistant attorney general of the criminal division. That's when I was his special counsel. And we reported up through the deputy to the attorney general. So it's a normal order of hierarchy within the Department of Justice.

We all did our job. We worked closely with Barr. He was a good attorney general to work for. He gave us, you know, prerogatives to pursue the criminal matters that we wanted to proceed. He didn't have a political agenda. I think that he'll approach the Mueller investigation similarly.

It is a case. He has to evaluate the facts of the case. So I discount a little bit his statements about there is not an obstruction case here because he doesn't yet know what the evidence is. If Mueller can say to him, Bill, here's the evidence. Let's, you know, talk about how we want to proceed. I think he'll have a receptive audience in Barr. He may not get his way, but it's not someone who's going to try to capitate this for political purpose.

KING: It's not an automatic roadblock.

And you've reported that Cipollone finally starts on Monday.

BROWN: Yes.

KING: And are we seeing an evolution? Look, we -- what the president has tweeted about Rod Rosenstein, about Jeff Sessions, it's irresponsible, it's reckless, it's disrespect to the institution, disrespect to how things work, but it's -- that's what he says. In terms of what he does, he picks an establishment guy, Bill Barr, to be the attorney general. Not a trumpy. Someone who knows the institution. Has no loyalty -- no political loyalty to this president, at least that we know of. Now he's brings in a serious person as the White House counsel.

Do we get the sense that there's -- it's like on other policy matters, there's what the president says and then the more professional sense of what they're doing?

BROWN: Oh, absolutely. And I think the calculus is, we want people in these positions who could have a good relationship with Mueller, someone who is seen as, you know, a respectable figure. And Cipollone's big job coming in as White House counsel is to be dealing with the expectation of subpoenas from House Democrats, as we've reported. I mean there is an expectation that there was going to be oversight investigations and Cipollone is viewed as someone who can deal with that. And that is why we've reported that I think it's, what, a couple dozen lawyers that are going to be hired up.

PEREZ: Probably -- yes, probably maybe 30 lawyers they're looking for. BROWN: Well -- 30 lawyers, which is -- which is a bigger -- will be a

bigger team than was under Don McGahn because of this expectation of not just the Mueller probe, but also all of these probes from the House from the Democrats.

KING: It's a fascinating time. A lot of the pieces are starting to move and we'll see if they come together. Appreciate everybody coming in with the breaking news here.

Up next for us here, new signs of what the president calls the hottest job market on planet earth might be cooling a bit.

(COMMERCIAL BREAK)

[12:29:15] KING: Welcome back.

The new jobs report out today. And 155,000 new jobs added in November. That fell short of economist expectations. But the unemployment rate did hold steady at a historically low 3.7 percent. And wages rose another 3.1 percent in a slowing, but still strong, labor market.

Our chief business correspondent Christine Romans is here to break down the numbers.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: John, this is a weaker than expected jobs report. The forecasts out there were something around 200,000. And so far this year, about 215,000 new jobs on average each month, but it came in at 155,000. So some cooler, hiring by companies this month.

And the reason why it could honestly be is because the unemployment rate is already so low you're nearing full employment. It might be that companies just can't find the workers they need. That's something we have heard from CEOs.

[12:30:02] Where are the sectors that are hiring here. In business information services, in health care, in manufacturing.