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New Filings Reveal More Trump Campaign-Russia Ties; Democrats Debate Whether to Push Impeachment; Trump Announces Chief of Staff John Kelly is Leaving; Warning Signs for the Trump Economy?. Aired 8- 9a ET

Aired December 9, 2018 - 08:00   ET



[08:00:21] JOHN KING, CNN HOST (voice-over): President in peril. New court documents detail hush money, team Trump lies, and even deeper contacts with Russia.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We're very happy with what we are reading. There was no collusion whatsoever.

KING: Plus, a new White House shake-up includes a new attorney general.

TRUMP: One of the most respected jurists in the country. A terrific man.

KING: And a Republican rebuke.

SEN. BOB CORKER (R), TENNESSEE: It's un-American.

KING: Congress says the president must not give Saudi Arabia a pass for murder.

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: MBS, the crown prince, is a wrecking ball.

KING: INSIDE POLITICS, the biggest stories sourced by the best reporters, now.


KING: Welcome to INSIDE POLITICS. I'm John King.

To our viewers in the United States and around the world, thank you for sharing your Sunday.

New court filings accused the president of breaking campaign laws and they cast a harsh light on both his White House and campaign teams.


NEAL KATYAL, FORMER U.S. SOLICITOR GENERAL: This is Southern District prosecutors, his own Justice Department, Trump's own appointees saying that you, Mr. President, are directly implicated in federal felonies. Here, you directed your own personal fixer, Michael Cohen, to do his stuff and he was doing it at your direction. And then it goes on further to say this is a huge violation of law. This is not some minor technical thing. This is the core of what our democracy is about.


KING: Plus, the president picks a new attorney general and now has to pick a new chief of staff.


TRUMP: John will be leaving at the end of the year. He's been with me almost two years now as you know between the two positions. I appreciate his service very much.


KING: And for the president headaches on Wall Street and on Capitol Hill, the markets don't like trade tweets and Republicans are demanding the president stopped coddling Saudi Arabia.


GRAHAM: If you want to buy our weapons and integrate your economy into ours, there's certain price to be paid. Don't chop somebody up in a consulate. That's not too much to ask.

How crazy is this guy to think he could lure somebody to a consulate in Turkey who basically is a foe of Saudi Arabia kill him and nobody would say anything about it. That shows to me a depth of dangerousness that we got to deal with.


KING: We begin this Sunday with new evidence the president, his White House, his campaign 2016 team and his family business are in deepening legal peril. That's a stunning list and it bears repeating, the president, his White House, his 2016 campaign team and his family business are in deepening legal peril.

Just some of the new allegations and details in new court filings the president personally directed and used Trump Organization funds for hush money payments that violate campaign finance laws, the then- candidate Trump was among those kept up to speed on Trump Tower Moscow negotiations four months after he said the project was abandoned, additional an earlier Russian contacts with Team Trump about working together during the 2016 campaign, Trump fixer Michael Cohen coordinated with the White House before giving false testimony to Congress, former Trump campaign chairman Paul Manafort kept in touch with the White House as cases against him advanced in the courts.

On Twitter, this take from the man the court documents referred to as individual one. Quote: Totally clears the president. Thank you!

Democrats see it very, very differently. (BEGIN VIDEO CLIP)

REP. JOHN GARAMENDI (D), CALIFORNIA: You might call it the opening days of an impeachment. We're getting to that point now. We're in this situation where high crimes and misdemeanors have occurred.


KING: With me this Sunday to discuss the new filings and the direction of the investigations, CNN's Evan Perez, Michael Zeldin is CNN legal analyst who once worked with Robert Mueller, and Jennifer Rogers, a CNN legal analyst and former prosecutor in the Southern District of New York.

Evan, I want to start with you. You've been at this for months. You have a Flynn filing, a Manafort filing, and a Cohen filing. And so, sometimes, it's hard to put all the pieces together, but help us with the building blocks. Where is the direction that Robert Mueller heading?

EVAN PEREZ, CNN SENIOR JUSTICE CORRESPONDENT: Look, I think the storm clouds are building for the president and I think he has every reason to be very, very worried. Look, back in August when Michael Cohen first stood up in court and said that the president directed him to break the law essentially, to break campaign finance law with these payments to these women, right, before the election, to hide it from the American public before they went to the -- to vote was the first time we saw that this might be going in this direction and the fact that that ended up in the in the court filings was a significant step.

But what happened on Friday was the prosecutors from the Southern District of New York are now wholeheartedly endorsing what Michael Cohen has said, that the president was part of this conspiracy to break the law.

[08:05:10] And that's a very big, big step that's been taken by the Justice Department who -- you know, these are people who are appointed by this president who are now making this allegation and I think you take it together with the Flint filings and you take it with the Cohen filings and Manafort filings, what you're beginning to see is a Robert Mueller is go -- is beginning to build a case against this president.

He believes according to what we've seen now that that there that this president was involved in some of these crimes and beyond the actual initial crimes of dealing with the Russians while he was running for president, there's also the obstruction part of this which is that while these people were lying essentially, they were -- they were working with inside the White House, perhaps even the president himself, to lie to the American public.

KING: And as much -- as stunning as what these new filings tell us, we need to be reminded and we need to remind ourselves constantly, there's so much more we don't know.

Jennifer, I want to bring you into the conversation. You used to work in the Southern District of New York. You know, it's highly unusual for campaign violations to be charged as felonies. Normally, you bring the person into the room and you say, look, you did this, OK, we -- campaign laws can be confusing, misdemeanor or settle it civilly or pay it off.

But here's what they say in this filing: with respect to both payments, Cohen acted with the intent to influence the 2016 presidential election. Cohen coordinated his actions with one or more members of the campaign with respect to both payments he acted in coordination with and at the direction of individual one. So, what the Southern District of New York, not Robert Mueller, separate investigation are saying is individual number one the president and other people in the Trump campaign were aware of this, knowingly, willfully violating campaign laws.

What does it say to have the president the United States accused of felonies?

JENNIFER RODGERS, FORMER FEDERAL PROSECUTOR: Well, it's basically unprecedented, John. And you know I think it's important here the way that they're characterizing this. I mean, usually, you're right, these matters don't end up as felonies. But there are some differences here. One, of course, it's the president. Two, of course, you're talking not about a straw donor situation where someone is just violating the amounts that they're allowed to give or something like that, that's a lot of campaign finance violations look like that.

This one is different. They're saying they really were trying to impact the election in a meaningful way and voters want to be informed. Transparency is the purpose of these laws.

And so, when they can't be -- when Michael Cohen was operating as the papers say from the shadows to try to impact an election from the shadows, you really have an undermining of our democracy in a way that is different from a lot of campaign violations. So I think that's why they're pointing out the importance of this violation and saying listen the president was involved in this.

That still leaves the question of what they're going to be able to do about it, but I think the important point is they're making their points and they're telling the American people that this happened.

KING: And another part of it, I want to read from another piece. This is another part of the filing here. We've known about contacts, dozens of contacts between Trump campaign officials and Russians. In some cases, the Trump campaign writes them off, Carter Page is nobody, George Papadopoulos is nobody, Jared Kushner was naive, Trump Jr. was naive.

In this, now, we have another content more contacts with Russians that go back even farther this from the Cohen filing in or around November Cohen received the contact information for and spoke with a Russian national who claimed to be a trusted person in the Russian federation who could offer the campaign political synergy and synergy on a government level. The defendant recalled that this person repeatedly proposed a meeting between individual one and the president of Russia. Cohen however did not follow up on this invitation. The documents also say that he did talk about that with individual number one the president of United States use collusion use political synergy, synergy on a government level. That's what the court documents say Michael Zeldin, this is what the president says.


TRUMP: We're very happy with what we are reading because there was no collusion whatsoever. There never has been. The last thing I want is help from Russia on a campaign. As far as the report that we see, according to everybody I've spoken to, I have not read it, there's absolutely no collusion which is very important.


KING: The most important part at the very end where he concedes I have not read it, because if he read the Flint filing, the Manafort filing and the Cohen filings, there's clear that the special counsel thinks there's collusion. He may not use that word, but over and over again, meetings, coordination cooperation with Russians. What are the stakes here for the president?

MICHAEL ZELDIN, FORMER FEDERAL PROSECUTOR: So I think collusion is a word that implies conspiracy and I'm not sure that the documents show conspiracy as much as they show a willingness to communicate. We need to go one step further to see whether there was an agreement to take action collectively before we have a collusive conspiratorial, you know, engagement here. But there's clear evidence in all these, you know, pleadings that the president's team was receptive to interference, if you will, or input from the Russians.

[08:10:08] The last part that you just read relates to the building of the Trump Tower in Moscow. They were clearly interested in doing that and the president wasn't transparent about what he was doing in Moscow while he was running for president.

So all of this stuff raises the issue of will there be this last step found by Mueller to create a criminal, you know, conspiracy or will this just be in the political realm of lack of transparency acquiring your office by means of deceit and whether that rises the level of an impeachable inquiry.

KING: And so, Jennifer, come back into the conversation with your experience. When you read these documents, they give us hints, they give us crumbs, if you will. A lot of stuff is redacted. From your experience, take us to the degree you're willing to go behind the curtain, what do you see as the pieces, where do you see this going?

RODGERS: Well, I wish I knew, John. I mean, one thing that's important to note is these documents are not about laying out Mueller's case for collusion or obstruction. These documents are about getting these two men Michael Cohen and Paul Manafort sentenced. They're only talking about the things that their judges need to know.

So, most of the things that that we all want to know about is whether they have a collusion case, whether they have an obstruction case or not even the point of these documents and aren't even contained in them and then, of course, there are a lot of things that are redacted because they hint at things that are part of ongoing investigations.

So I'm afraid we have to wait until Mueller's report comes out or perhaps new indictments before we know where we're going. But I do think that the strength of the language that's being used here suggests that they do think they have cases in obstruction and their collusion I'm not so sure we'll have to wait and see on that one.

KING: But the strength of the language is important. I want to sneak this in here because a lot, let's say you're a Trump supporter out there. Here's a businessman running for president, that makes it different, so he has this deal in Moscow, so what, right? Some people would say, so what? That was his job, he decided to be run for president, we want outsiders to be able to run for office, why are you saying he can't have these conversations?

Mueller makes the connection right here. If the project was completed, the company could have received hundreds of millions of dollars. The fact that Cohen continued to work on the project and discuss it with individual one, that's the president, the candidate in this case well into the campaign was material to the ongoing congressional and special counsel office investigations, particularly because it occurred at a time of sustained efforts by the Russian government to interfere with the U.S. presidential election. Similarly, it was material Cohen during the campaign had a substantive telephone call about the project with an assistant press secretary for the Russian Federation.

So, again crumbs but beginning to connect the dots.

PEREZ: Right, and I think it's very important for us to realize that when they address the lies and including the lies about whether or not the president was doing business with Russia, what you're beginning to see is that Mueller is pursuing a theory that if you lie to the media and lie to the public as a way to obstruct an investigation, that he believes crosses the line into criminal territory. And so, that's I think bodes very badly for the president, and the fact that if you remember, there was this whole episode on aboard Air Force One to fashion a story, a not true story about what exactly was going on in the Trump Tower meeting.

KING: I'll be more blunt, to fashion a lie --

PEREZ: Right.

KING: -- about what happened at the Trump Tower meeting.

PEREZ: Right.

KING: To that point, Ken Starr tried to make this argument back in the days I was covering the Clinton White House in those days, does the law support that, that public officials and the people around them people on the taxpayer payrolls or campaign payrolls lying to the public, is that obstruction? ZELDIN: It can be. I think that if you are trying to interfere with

the efforts of law enforcement to find you. You know, you're putting pepper on the trail so that the dogs can't catch you, those sorts of things can amount to obstruction. And in the document, in the Cohen document, he says by publicly presenting this false narrative, Cohen, he interfered with the investigation. And so if Cohen did interfere with the investigation by presenting a false narrative, anyone who these people were then private citizens are presenting false narrative.

KING: He says in terms of the testimony to Congress that it was shared with the White House. The questions he does not tell us did they was there back and forth, was their input, did the president know, he doesn't tell us that he just tells us it was shared with the White House. So, again, Mueller leaving us crumbs to be determined on the building blocks.

ZELDIN: And that's -- for me, as I read all these documents this one point of whether or not the White House helped Cohen construct this false narrative to Congress is the most frightening thing for them from a legal jeopardy stand.

KING: We'll watch this play out. Jennifer, Michael, Evan, appreciate your coming in on a Sunday morning.

Up next for us here, more on the new Mueller filings and why the president says there's nothing there. It also demands that the investigation and now.

As we go to break, let's remember this was a week we watched a president say goodbye to his father, the president.


GEORGE W. BUSH, FORMER PRESIDENT: Through our tears, let us know the blessings of knowing and loving you, a great and noble man, the best father a son or daughter could have.

[08:15:03] And in our grief, let us smile knowing that dad is hugging Robin and holding mom's hand again.




KING: Welcome back.

The timing of the new court filings only adds to the drama and the stakes for the president. Quote, time for the witch hunt to end. That's the tagline of one Saturday presidential tweet.

Now, it's hardly the first time we've heard that sentiment. But how to handle the Mueller probe and the president's demand that it be ended will be a major confirmation question now for William Barr the president's choice to be the next attorney general.

Plus, this new information comes just as Democrats plan to take control of the House. There are already some calls for impeachment, though most Democrats say, let the feds keep at it.


REP. JIM HIMES (D-TN), INTELLIGENCE COMMITTEE: The Southern District of New York is the first entity here to accuse the president albeit indirectly of a crime. It was those words at the direction of the president of the United States. So, yes there is now a specific accusation of a specific crime. Now what Congress does with that is, of course, very much an open question.

[08:20:01] I would suggest that the answer to that question has to be partly informed by what happens next, what else does Mueller have.


KING: With us to share the reporting and their insights this Sunday, "Politico's" Eliana Johnson, CNN's Jeff Zeleny, CNN's Manu Raju, and Seung Min Kim of "The Washington Post".

Let's start with the point the congressmen made at the end there. Will these more liberal members, these more combative members listen when the leadership says slow down, let's let Robert Mueller, let's let the Southern District of New York give him a few more months, let's see where this goes? Or will they come out of the box saying let's file articles of impeachment?

MANU RAJU, CNN SENIOR CONGRESSIONAL CORRESPONDENT: I think they'll hit the brakes initially. I think that the belief is let the report come from Mueller. They don't want to get in the way of the report. I do think that there are things that Bob Mueller will say and that will come out and the investigation from the Southern District of New York for instance that will lead to further investigations expect hearings and investigations and the whole -- what happened in 2016, and the fact the president has been implicated and crime. There has been no hearings about that and Republican-controlled Congress, but Democrats will look into that.

But -- and when you're talking about impeachment, those questions are going to wait until the report comes on, if the report is very damaging, that's when that debate will happen. And it could be -- it's something that the Democrats will have to worry about overreaching and the leadership is concerned about this.

KING: So it's difficult politics for the Democrats, their decision- making. But the most difficult political moment is here for the president. You just had a legal conversation with the lawyers and the justice reporters.

Look at these headlines from around the country this weekend. It's the president -- the president's in full denial about what's in the reports, but look at the headlines around the country. Your approval rating is already hovering around 40 percent. You just had a very bad midterm election year. You have a time we'll get to the specifics of a staff shake-up right now.

This is the political climate in the country. Voters everywhere are being told this is bad news. This implicates the president and so on. How does he handle this?

ELIANA JOHNSON, NATIONAL POLITICAL REPORTER, POLITICO: Look, his lawyers, whatever the president thinks, have been operating on the premise that this is going to be a political question of impeachment and do the misdeeds that Mueller outlines in his report -- are they bad enough for the president to be impeached? And so, I think Manu is exactly right that the debate is going to take -- the debate that's going to take places after the Mueller report comes out, do Democrats move to impeach then or do they settle it in the 2020 election?

And I think what you're going to see is a hard push from the president and his attorneys to say this is a political question that should be settled in 2020.

KING: And to that point, I just want to play -- so these are the president's allies on television, you might say in a different place on the dial, who clearly if they're if they're reading what's in these court filings, they're just deciding to ignore it.


SEAN HANNITY, FOX NEWS HOST: Zero evidence in any of these documents of Trump Russia collusion, zero.

DAN BONGINO, FOX NEWS CONTRIBUTOR: This is the equivalent of a taxpayer-funded private investigator following Donald Trump and his team around to harass him for the rest of his presidency. This is a joke. It's an embarrassment.

JOE DIGENOVA, FORMER U.S. ATTORNEY: There is no suggestion whatsoever that the president did anything wrong, committed any crimes or certainly had any contact with Russians.

PETER HEGSETH, FOX NEWS ANCHOR: Two years, millions of dollars, top Democratic lawyers, an eager press, and you have no evidence and no mention of Russian collusion.


KING: Now, that would break, dismantle, forever destroy any fact- checking machine if you try to put it through it. But if you listen to they're trying to say, number one, they're trying to convince the president space, if there is impeachment, or if there are indictments of more people, pay no attention, Robert was lying to you, don't believe anything he says. But in the context of that, the political argument, it is striking to me they seem to be making the case unless you see the president's hand in the cookie jar -- by the way, he is accused of campaign finance -- directly accused of campaign finance felonies.

But on the Russia question, they say, unless you see have a picture of him this hand in the cookie jar, it's OK, that his national security adviser, his son-in-law, his first attorney general we could go on forever and fill the hour met with Russians willingly happily took meeting with Russia, that's OK, he's the CEO of the operation, but that's OK.

JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Exactly, and those are the voices that the president is hearing and that the president is holding on to. He believes any and he's been actually quite successful over the last year, year and a half, at discrediting so many things -- this investigation, the press institutions of government.

So, the president is going to keep operating exactly as he has he's going to try and ignore this I say it's a witch hunt but the question is I think on Capitol Hill, as we learn more about this, will other Republicans begin to rise up will, they not? So far, they have not done anything at all.

So the president, he's --

KING: They're holding breath, they're holding their breath.

ZELENY: Yes, you can say the least. So, the president is in some instances a bit player in this point. It matters what happens around him and we'll see how he reacts. But look, he is going to be increasingly under pressure inside, so how he reacts to all this?

[08:25:00] KING: And how does his nominee new nominee for attorney general, Bill Barr, throwback to the first Bush administration, Democrats are going to ask him. The president keeps saying in the investigation, the president's fully transparent getting credit, for what he wants you to do, Mr. Barr, will you do it?

SEUNG MIN KIM: And it's not just Democrats who are going to ask those questions. Republicans will have those questions as well. Senator Susan Collins is among those who have said the nominee has to pledge that the Russia probe will be protected. And even Jerry Moran who -- of Kansas, who's not a guy who usually rocks the boat, says, I expect that commitment from Mr. Barr when he testifies before the Senate Judiciary Committee.

But, look, Democrats have already pointed out that he has taken expansive views of presidential power and he has made some critical comments of the Mueller investigation, just more pertaining to the types of hires that Mueller has made, I'm pointing to the political contributions of at least some on the team. So, those are going to be difficult questions that Bill Barr will have to learn to address. But next year, there's a 53-47 majority in the Senate. You just need a simple majority, Republican majorities in the Senate, you need a simple majority to get confirmed and barring a major catastrophe, Bill Barr should not have trouble getting to a majority.

KING: But I would argue, the more the president tweets end it, the more likely Bill Barr is going to have to say I will leave it just as it is. But president through this with this first attorney general, we shall see.

Up next, the Trump staff shake-up. John Kelly is out as White House chief of staff, but who's in?


[08:30:32] JOHN KING, CNN HOST: Welcome back.

The dysfunction between President Trump and his chief of staff, his current chief of staff, is about to end.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: John Kelly will be leaving -- I don't know if I can say retiring but he's a great guy -- John Kelly will be leaving at the end of the year. We'll be announcing who will be taking John's place. It might be on an interim basis. I'll be announcing that over the next day or two --


KING: "A great guy" -- you just heard the President say it right there, but CNN reporting is that the two have stopped speaking in recent days.

There is an internal fight now over the next chief. The VP's chief of staff is the leading pick. Nick Ayers has the backing of Ivanka Trump and Jared Kushner but he rubs many the wrong way.

To the point Eliana -- this is from an article you wrote for "Politico". "Ayers himself, however, is a polarizing figure within the West Wing whose rise has already sparked controversy. Several aides have told the President they would quit if he is tapped for the job with one predicting a melee of backstabbing to come."

Great way to run an organization.

ELIANA JOHNSON, NATIONAL POLITICAL REPORTER, "POLITICO": Well, you know, I made the point in the article that this is no different from the way that the White House is operating under Kelly, in Ayers' defense.

Kelly tried to push out suggested that Jared Kushner and Ivanka Trump leave. They, in turn, backed Nick Ayers' ascension to chief of staff in part as a way to push Kelly out, and succeeded.

But Ayers is a controversial figure. Notably, he is far more political than John Kelly and I think that's something that the President wants as he looks to 2020. But he is disliked by many in the White House.

And I think those maybe are empty threats by people who are telling to the President but certainly the dynamics in the Trump White House as a place filled with strong alliances, people pitted against each other are unlikely to change if he becomes the chief of staff.

KING: And so in the context of this playing out -- and we'll see if Nick Ayers gets the job. Again he's Mike Pence's chief of staff right now. You're right. His experience is all in politics, not in policy, not in government.

As this plays out, I was struck by this yesterday. Paul Ryan is leaving as Speaker of the House. No reason to say anything. The President says John Kelly is leaving and within minutes Paul Ryan puts out a statement.

"During this time he's become a dear friend and trusted partner. He was a force for order, clarity and good sense. He is departing what is often a thankless job but John Kelly has my eternal gratitude." Why?

I took that as number one, thank you, John Kelly but number two, Mr. President, he is an adult and you shouldn't treat people this way.

MANU RAJU, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Yes. And he was one of the guys that leadership would talk to frequently to raise concerns about privately about the President's conduct. Now, the question is whether he had any effect on the President's conduct and helped change the President's decision making on some issues.

And we'll probably learn a lot more about things that he may have prevented the President from doing after he leaves office. But Kelly himself had a pretty rocky tenure. He's had several controversies that are comments about demeaning immigrants, or his handling of Rob Porter situation, the White House aide who is alleged to have domestically abused his wives. And you know, these questions will be blemishes on his record going forward.

But on Capitol Hill, Republicans viewed him as a sense of calm, and someone they could talk to. They hope the next chief of staff will be like that.

KING: And as the President tries to fill the job, Nick Ayers, the leading candidate -- the "New York Times" saying that Treasury Secretary Steve Mnuchin, Mick Mulvaney the Budget director, Robert Lighthizer the trade aide -- there are other possibilities as the President tries to fill it.

What played out this week was pretty remarkable. Rex Tillerson, the former secretary of state, saying he would go to the President and the President would say do this, do that, do this and he would say no, Mr. President. That's against the law or that's against a signed treaty and the President would get mad at him.

So Rex Tillerson said that publicly and people saw it and the President tweets "Mike Pompeo is doing a great job. I'm very proud of him. His predecessor, Rex Tillerson, didn't have the mental capacity needed. He was dumb as a rock and I couldn't get rid of him fast enough. He was lazy as hell. Now it's a whole new ball game. Great spirit at State?

Would anybody in their right mind take a job with these people?

JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, Nick Ayers is about to. And Nick Ayers is a very confident young man.



ZELENY: To say the least, Nick Ayers is a very confident young man. Everyone thinks, or most people do, that they can be the one who can survive this wave here. But the reality is --

KING: Survive or tame Trump? What's --

ZELENY: At this point I think taming Trump is difficult to do. You manage the situation. But the reality here is the one person who is not changing position is the President.

[08:35:05] KING: Right.

ZELENY: So regardless of who is around him, that is not changing.

The bigger issue that I hear in the White House is talking to people, the offices are still somewhat empty. So as the President heads into what is going to be the biggest challenge of his presidency with Democrats on the House, you know, looking into everything with this investigation, there are not a lot of people minding the store.

From the communication side of things, to the legal side of things. So that is the challenge for Nick Ayers. It's the people who aren't necessarily -- you know, it's just not as well staffed as it may need to be for this. We'll see how he handles it.

KING: That is the perfect segue to where we go next.

Pressure points on the President just ahead when it comes to the economy and debates in Congress about the border wall and Saudi Arabia.


KING: A strong economy is President Trump's best political asset but even there this past week, some warning signs that left the President frustrated and his political team a bit nervous as the 2018 cycle gives way to the 2020 maneuvering.

Let's take a look at the numbers. You start here. With these numbers, the President should be thrilled and should have a strong political base. Lower unemployment, wage growth up in the last report, GDP growth is strong. Consumer confidence near 15 years high -- that's all great news for a president, especially heading into re- election.

But risks and worries ahead? The tax cut is starting to wear off, higher interest rates kicking in the new economy, trade wars causing a lot of turmoil around the world and in financial markets.

This happened just last week. You see the Dow was up on Monday but then wow down on Tuesday, closed for the George H.W. Bush funeral Wednesday, down again Thursday, down big time again on Friday in part because of the President's tweets. Now this is interesting when you look. The lower number is the President's overall approval rating. The higher line, the President's approval when it comes to the economy.

He is above water, 53 percent approve (INAUDIBLE) on the economy. Imagine what this number would be if the President did not have this -- the strong economy numbers. That's why his political team gets rattled when the markets had a week like they just had.

But his top economic adviser, Larry Kudlow says ignore the markets. All is fine.


LARRY KUDLOW, WHITE HOUSE CHIEF ECONOMIC ADVISER: The evidence is quite different than these speculations. I mean we're humming.

UNIDENTIFIED MALE: Let's talk about the economy --


UNIDENTIFIED MALE: -- for just a second before we go to questions.

KUDLOW: I was hoping you would.

UNIDENTIFIED MALE: You don't see a recession on the --

KUDLOW: I do not.

UNIDENTIFIED MALE: The economy is doing well. You don't see a recession on the horizon?

KUDLOW: I do not.

UNIDENTIFIED MALE: For the next couple of years?

KUDLOW: At least.


KING: He says at least a couple of years there. He says we're humming. The President gets frustrated when he sees the markets tanking.

I just want to put up some of the President's tweets this week on the air. Does he understand that sometimes they tank because of what he tweets, including in the middle of the week, "I am tariff man." You see -- I am tariff man.

The markets don't like a president who tweets in the middle of a trade confrontation with China "I am tariff man".

KIM: And also remember at the G-20. I mean he came out of that summit with very positive comments about his meeting with President Xi of China, saying they have made this agreement on a multitude of things. But then he got back to the United States. He started peeling back the layers of this trade agreement that he and the Chinese president allegedly reached and there were differing accounts of what the two sides agreed on. So that is a continuing problem for the President.

He tweets or says things but once you kind of dig down into details there's a lot of confusion and that's not good for, you know, the economy writ large.

KING: Yes. Markets do not like uncertainty.

Another big question the President's political team is worried about that. You don't want to head into a re-election campaign with an economy in turmoil especially in these farm states and these midwestern states where the President did well, worried about tariff and trade.

Another thing is we're beginning to see, at least on the question of Saudi Arabia, strong pushback from Congress including leading Republicans who say frankly, they think the President is coddling Saudi Arabia. They think Jared Kushner is too close to the Crown Prince.

They think the administration doesn't get it. That they killed and dismembered Jamal Khashoggi, they think the President needs to do more.

Here's the chairman of the Foreign Relations Committee, Bob Corker.


SENATOR BOB CORKER (R-TN), SENATE FOREIGN RELATIONS COMMITTEE: I have zero question in my mind that the Crown Prince MBS ordered the killing, monitored the killing, knew exactly what was happening, planned it in advance. If he was in front of a jury, he would be convicted in 30 minutes.


KING: How does this fit into what we talked about throughout the hour -- very difficult and precarious moment for the President, whether it's legal challenges, economic challenges, political challenges and this?

RAJU: It's not going to go away, this issue about Saudi Arabia. Expect on the senate floor this week there's going to be a vote to end U.S. involvement to the Saudi-led war in Yemen. There are probably going to be enough votes to get this out of the Senate.

Now, the President could block it, veto it. It's probably going to the House. It will be a symbolic rebuke of the President's handling of this. And there are other legislative pushes that are serious that involve Republicans like Lindsey Graham, who want to slap MBS with sanctions, who want to suspend arms sales that the President has touted to promote the relationship between Saudi Arabia and the U.S. So the President is facing pressure on this front by not denouncing the murder of a journalist. That has concerned Republicans and Democrats alike and it's going to continue into the new Congress.

KING: And again, another challenge, it's the year end -- big basket of challenges for the President. They passed a two-week extension otherwise we would have been in shutdown week last week. Because of George H.W. Bush funeral they passed a two-week extension.

One of the questions is can the President get his border wall funding? Will the Democrats do some kind of a trade? Listen to Nancy Pelosi.


UNIDENTIFIED MALE: Would you be willing to support some degree of wall funding if you got a permanent bona fide solution on DACA?

[08:45:05] REP. NANCY PELOSI (D-CA), HOUSE MINORITY LEADER: No. Most of us, speaking for myself, consider the wall immoral, ineffective and expensive. And the President said, he promised -- he also promised Mexico would pay for it. So even if they did, it's immoral still. And they're not going to pay for it.


KING: When you know how firmly the President believes he wants his wall money, and he wants a lot of it, wants it guaranteed. You hear those very firm words from Nancy Pelosi, the Democratic leader perhaps the future speaker -- how do we get through this.

JOHNSON: I think the wrinkle here is that the two-week delay in the shutdown fight because of H.W. funeral now butts up against the Christmas break. And I think that makes everybody more likely, probably, to make a deal and perhaps even the President.

He backed down on the wall funding once. Unclear whether that makes him more or less likely to do it again. But I do think that sort of is likely to soften everybody's position.

KING: It's a fascinating question because the Democrats will have more power in January. So isn't this the best moment for the President if he has leverage?

ZELENY: I mean under a normal scenario, yes. But I mean he has blinked on it once but he's been furious about the inability to get it. So I'm not sure how this is going to play out.

But again, I think, you know, as often in Washington happens, the crunch of time, you know, will dominate everything. And I think, you know, that probably is on -- is going to hurt him here.

But, you know, he has so much else going on, he could throw a stink bomb, you know, and that would be a government shutdown. Not good for people but it would change the subject.

KING: On him. Also a huge challenge for the Democrats. > Up next, our reporters share a page from their notebooks including how the aforementioned Nancy Pelosi broke the back of the rebellion in her ranks.


KING: Let's head one last time around the INSIDE POLITICIS table, ask our great reporters to share a little something from their notebooks to help get you out ahead of the big political news just around the corner.


JOHNSON: I'm looking ahead forward to a second North Korea summit between President Trump and Kim Jong-un which national security advisor John Bolton predicted would happen perhaps early next year with interesting reasoning. He said North Korea has not honored their commitments that they made at the first summit last June. And so the President thinks we need a second summit, which is not the way it usually works but it does suggest that the President is pressing for another summit.

Interesting also, given CNN's reporting this week that the North has accelerated building on a nuclear facility that they had vowed to stop building on. So it does look like this could happen early next year and maybe a repeat of the first summit.

KING: Different approach. First one didn't work. We shall see.


ZELENY: With all the drama swirling around in Washington the White House is actually looking ahead to 2020, just around the corner in their view. But Bill Stepien who has been the political director inside the White House, he now is leaving on the outside. He's part of the Trump 2020 campaign.

And I'm told the President has told his advisers he wants more campaign rallies and he wants them soon, starting early in the year. So with all this drama happening in Washington as the new political order is shaping up on Capitol Hill the Trump team wants to go back to what makes him happy and have him surrounded by adoring fans at rallies. We'll see what the narrative is. But look for rallies coming up in the winter.

KING: Season 2020 starts a little early. Ok.

ZELENY: Indeed.

KING: Manu.

RAJU: John -- there are roughly 12 incoming freshmen Democrats, who vowed on the campaign trail to not support Nancy Pelosi or suggest that they wanted new leadership.

Well, A number of them are starting to go quiet as they get close to the speaker's vote, some are actually suggesting they're going to support her in January. Two last week came out in support of her, or suggested they would support her -- Haley Stevens of Michigan, Gil Cisneros of California.

Others have gone quiet Elissa Slotkin from Michigan -- we tried to ask her six times recently if she would vote for her on the floor after she said she would oppose her on the campaign trail. She didn't quite say.

As well as Mikie Sherrill of New Jersey, also unclear where she is even though she campaigned against Nancy Pelosi.

There are some freshmen who are hardcore nos. Joe Cunningham of South Carolina, Max Rose of New York. But these other freshmen are holding out for something that Pelosi can give them, potentially committee assignments on key committees that typically are given out to more senior members.

Pelosi (INAUDIBLE) also concerning some changes internally including putting term limits on chairmen, allowing the younger members potentially to move up because some of these members who are holding out, may get something, may ultimately vote for her.

But of course, they said something different on the campaign trail and will have to answer to that back home.

KING: They would have to answer to that but the speaker-to-be, she's nothing but methodical.

Seung Min.

KIM: Mitch McConnell hasn't given the official word yet that criminal justice reform is dead for the year but in private he has pretty much all but said that. I mean he has told donors, outside groups, and his own advisers that chances of a vote are pretty unlikely this year. And that's despite this very unusual left-right coalition that supports this legislation to loosen or relax some mandatory minimum standards and that includes support from the President.

But it is a bill that is extremely divisive within the Senate Republican conference. There's been some heated discussions both inside and outside about this legislation. If there's one thing that Mitch McConnell does not like, it is legislation or initiatives that really split his conference.

So despite a presidential tweet on Friday saying, you know, "Go for it, Mitch," from the President, Mitch McConnell is pretty impervious to outside pressure even if it's from the President.

KING: And he's kind of on the ballot in 2020. You wouldn't want somebody running actually from the right saying you're soft on crime, would you?

KIM: No.

KING: I'll close with this. The Republican near silence about those damning new Mueller court filings masks a private worry, if not GOP panic about the road ahead. Even before the new filings, Republicans were coming to terms with the fact the President will not change. The angry tweets and outbursts they believe that are most responsible for their midterm shellacking are not going to end.

[08:55:05] Now they see a President in a mix of denial and rage about Mueller's progress and expect that anger only to grow as the investigation continues and as Democrats gain subpoena power in the House.

Nearly a dozen veteran Republicans reached over the weekend, see a bunker mentality ahead -- bunker mentality. That was a little Boston there for you. A President focused on his survival and his reelection regardless of the impact on the broader Republican Party.

Here's a colorful prediction that sums it all up from a top Republican player that captures the GOP mood quite well. Quote, "Expect vicious, bilious gridlock with a sprinkling of constitutional crisis. It should be fun." There's a lot of sarcasm like that in town at the moment.

That's it for INSIDE POLITICS.

Again, thanks for sharing your Sunday morning. Hope you can catch us weekdays as well. We're here at noon Eastern.

Don't go anywhere. Up next, "STATE OF THE UNION" with Jake Tapper. Among his guests Republican Senator Marco Rubio and Democratic Congressman Jerry Nadler. Stay with us please.

Have a great Sunday.