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Dow Plunges Amid U.S.-China Trade Tensions; Prosecutors Implicate Trump in Campaign Finance Law Violations; Supreme Court Let's Stand Rulings that Stop States from Denying Contracts to Planned Parenthood; North Carolina Officials Investigate Possible Ballot Fraud; Winter Storm Slams the Southeast. Aired 11:30-12p ET

Aired December 10, 2018 - 11:30   ET



[11:31:28] KATE BOLDUAN, CNN ANCHOR: Another rough day so far for Wall Street, as the Dow is plunging hundreds of points in early trading.

Let's get over there. Cristina Alesci is at the stock exchange with a look.

Cristina, what's going on.

CRISTINA ALESCI, CNN BUSINESS CORRESPONDENT: Investors want answers and they're not getting them. They want to know whether or not Britain will have an orderly exit from the European Union. They want to know whether the Fed is going to do another rate hike. And they want to know what's going on with the trade war. Right now, the answers to all of those questions are unknown. That's what is driving a lot of the jitters today. In the longer term, you do have investors and traders starting to wonder about the underlying fundamental economics, and the economy and economic growth. And whether or not we can continue to have this strong economic growth, domestically, especially when it comes to the United States. We have seen very strong jobs numbers. Obviously, we had a very strong jobs report on Friday. The question is, does it continue. And we're seeing some banks and big investors come economists starting to question that and look for cracks in the economy -- Kate?

BOLDUAN: Yes, the announcement from Theresa May on delaying the Brexit vote not helping either.

Cristina, great to see you. Thank you so much.

Coming up for us, new revelations from the special counsel. Why it has one of my next guests saying the country is nearing a worst-case scenario when it comes to the president and Russia.


[11:37:29] BOLDUAN: Court Friday, CNN now counts at least 16 associates of Donald Trump had contacts with Russians in the 2016 campaign and transition, 16 people in his orbit. How damaging could those latest revelations from the special counsel and federal prosecutors be for the country? One of our next guests says we're now nearing a, quote, "worst-case scenario."

Joining me now is Garrett Graff, a CNN contributor, author of "The Trump Matrix: Inside Robert Mueller's FBI and the War on Global Terror," and CNN national security analyst, Samantha Vinograd. She was senior adviser to the national security advisor during the Obama administration.

Its' great to see you guys.

Garrett, we don't have Mueller's report, but you say the country is already approaching the worst-case scenario when it comes to Russia. Why is that?

GARRETT GRAFF, CNN CONTRIBUTOR: From a counterintelligence perspective, the worst-case scenario is to have a foreign power have leverage over your head of state, for them to have some sort of intelligence operation or even blackmail that can convince a head of state to act against their country's best interests. And what we already know from the Trump investigation by Special Counsel Robert Mueller, especially after these last 10 days of revelations from Michael Cohen, Michael Flynn, and Paul Manafort, is that Russia has had leverage over Donald Trump over the last two years. That even if the American people didn't know that Donald Trump had been pursuing this Trump Tower Moscow deal, Russia did. And that they knew that the Trump administration was lying to the American people about that.

Beyond that, we see these Michael Flynn telephone calls that he lied to the public about as well. And it's clear from those 16 contacts that there was an expensive and extensive effort by Russian intelligence, through Russian intelligence to penetrate and make contact with the Trump campaign, which they welcomed with open arms, which is what we're continuing to find out, is that they embraced the help as it came from Russians offering what in Friday's court filing was called, quote/unquote, "political synergy," which I think is a cute synonym for collusion.

BOLDUAN: Sam, if this is the case, what is the impact on American foreign policy?

[11:39:53] SAMANTHA VINOGRAD, CNN NATIONAL SECURITY ANALYST: Well, Kate, it has a direct impact on the policy the administration might be trying to pursue even today. Can you imagine trying to work on democracy promotion today at the White House, leaving aside Russia policy? Trying to go out and call for free and transparent elections around the world today, if you're at the State Department or USAID, is going to be increasingly difficult based on the revelations that the president himself was not transparent in his own election. We have to practice what we preach on these issues.

I can tell you during the four years I spent at the White House, I never once walked into the situation room and heard President Obama issue a decision, and thought to myself, is he making that for the right reasons? If you're working on Russia policy at the White House now, I don't think there's any real certainty, even today, that when the president, if he holds a national security meeting on Russia, is going to come out with a policy decision based on what's best for our country and perhaps not what's best for him.

BOLDUAN: Garrett, the president makes the case today, and we can put up the tweet, but looking past the spelling errors, that "The Democrats can't find a smoking gun tying the Trump campaign to Russia." Is he right? We haven't seen a direct link of collusion between the campaign and the Russian government.

GRAFF: Yes, but what we are seeing is the development sort of building block by building block of a pretty extensive conspiracy. And remember, Robert Mueller and federal prosecutors have outlined in recent months two separate criminal conspiracies that operated to help elect Donald Trump in 2016. One was run by the Russian government with the Internet Research Agency and the Russian intelligence unit, GRU, and the other was the campaign finance scheme run by Michael Cohen and individual number one, A/K/A, Donald Trump. What we now know from Michael Cohen's plea agreement is that the central figure in one of those criminal conspiracies, Michael Cohen, was attempting to contact and get assistance from the central figure in the other criminal conspiracy, Vladimir Putin. And that's a stunning revelation. And we are deep into the territory of what are sort of once unthinkable scenarios about a foreign power intervening in a major way to change our American democracy.

BOLDUAN: Sam, something you said earlier I wanted to ask about. If you were advising the president, or you were advising the National Security Council right now on Russia policy, what do you do with all of this information coming in? Are those conversations happening?

VINOGRAD: They might be happening but the best thing the president could do right now when it comes to Russia policy is to actually engage with his National Security Council team. We had countless meetings that involved the full cabinet. We went through deliberations at every level of government that were based on intelligence about what Vladimir Putin was trying to achieve. Part of that intelligence, Kate, would probably say Vladimir Putin is benefitting from this whole aura of disorganization at the White House, and the president's fixation on discrediting the Mueller investigation, which is a linchpin of our democracy. The best thing the president can do, from a Russia policy perspective right now, is stop tweeting and spend more time in the situation room with his team.

BOLDUAN: All right, we will see if that happens.

VINOGRAD: If only.

BOLDUAN: Great to see you.

Great to see you, Sam.

Garrett, really appreciate it. It was a very interesting read.

Coming up, there's that and then there's also this. The Supreme Court is handing down a big win today to Planned Parenthood. Letting stand lower court rulings that states cannot block Medicaid contracts to the organization.

Let's go over to CNN's justice correspondent, Jessica Schneider, with all the details.

Jessica, what exactly did the court do today?

JESSICA SCHNEIDER, CNN JUSTICE CORRESPONDENT: Well, Kate, all this means that Planned Parenthood, their affiliates, will keep their Medicaid funding and states cannot terminate contracts between Medicaid and the Planned Parenthood offices that provide that preventative care for low-income women.

Really, what's important to note here is that the Supreme Court, they didn't directly rule. Instead, they actually decided not to hear this case. That's what kept the lower court ruling in place.

And that decision not to take this case, it actually gives us some interesting insight into the Supreme Court itself about how these justices are moving forward now with Justice Brett Kavanaugh on the court here. So both Justice Kavanaugh and Chief Justice John Roberts sided with the court's liberals today in deciding not to take the case. On the flipside, the court's three solidly conservative justices, Thomas, Alito and Gorsuch, they issued a dissent saying the Supreme Court should have taken up the case.

So, Kate, what's interesting is this really shows how Chief Justice Roberts, also junior Justice Kavanaugh, they may be trying to avoid cases that encompass high-profile abortion related issues. At least for now, the two of them siding with the liberals today. Interesting.

BOLDUAN: Very, very interesting.

Jessica, great to see you. Thanks. Really appreciate it.

Coming up still for us, more than a month after the midterms, a North Carolina congressional seat is still in limbo after some really stunning allegations of election fraud. So where does that race stand right now? What happens now? Is the state going to now force them to carry out an entirely new election?

[11:45:05] We'll be right back.


BOLDUAN: It's been nearly five weeks since Americans went to the polls in the midterm elections. In North Carolina, not only is it not over, though, they may very well have to do it all over again in one race. Here's where things stand in the state's ninth congressional district. Republican Mark Harris is ahead by 905 votes over Democrat Dan McCready. That's nowhere near the end of the story. The State Board of Elections is investigating allegations of election fraud focused on a whole lot of questionable absentee ballots. If they find evidence of misconduct, they can order another election. One thing we know right now is it is a mess.

Joining me right now is Dallas Woodhouse, the executive director of the North Carolina Republican Party.

Dallas, it's good to see you. Thanks for coming in.


BOLDUAN: What is the latest that you are hearing on when the state is going to have a final word here from the State Board of Elections?

WOODHOUSE: We don't exactly know. We think there will be a public hearing in the next couple of weeks, probably around December 20th, in that range. That will be the first time we hear some detailed information about the actual allegations. I have a column out this morning, just published, praising the media for bringing sun light and disinfectant to an issue that plagued North Carolina for well over a decade. We had a systematic failure to address this between three different administrations of governors and many boards of elections and state and local prosecutors. That systematic failure includes us and the other party. I really think the question of who is going to be seated in the ninth district is now a secondary question of having to root out the systematic failure and cultural political corruption in the southeastern part of our state, which is really a scourge on our democracy.

BOLDUAN: Look, it is a huge problem if they find out we have the evidence pointing right now. That's for sure. But in the most immediately, you do need to figure out --


WOODHOUSE: It's revolting and disgusting.

BOLDUAN: The most immediate, you need to figure out what is going to happen with the seat. You need to seat somebody in the Congress. You told my colleague, Drew Griffin, that when you saw his piece about the strange things going on with the absentee ballots, that in the story you were telling him, that made you throw up. It makes me wonder, if what we know already, already made you sick to your stomach, why not call for a do-over instead of waiting for the board of elections?

WOODHOUSE: That would not match the legal standard. The 286,000 people cast ballots that are not in question. Most of those people would be disenfranchised in a special election, which would only see about 25,000 to 40,000 people vote. As good as the media reports are, we need to see the actual evidence from investigators. And if it rises to a level that the evidence shows that there needs to be a new election, we, of course, will not oppose that at all.

BOLDUAN: If the board of elections orders a do-over because of misconduct, is the state Republican Party going to continue to support Mark Harris?

WOODHOUSE: The North Carolina Republican Party will, as it is obligated to do, support the candidate selected by our voters or executive committee in the ninth congressional district. By the way, I know Mr. Harris personally. I believe in him. It is hard for me to conceive a situation that he was a part of this or knew anything. Most of the time, Kate, when people say I can't see it, I literally could not see it. My mind can't get around that.


BOLDUAN: I hear you, but that comes out to $34,000 is how much Harris' campaign owes the company that contracted with the guy at the center of all of this. It's for nothing for, quote, unquote, "reimbursement payment" for Bladen absentee, Bladen County.

WOODHOUSE: The key part of that filing is they did not in fact pay that.

BOLDUAN: But they own it. They knew it was happening.

WOODHOUSE: They may have owned -- they may have owed it for what they believe was legitimate activities and are not going to pay for activities that they now know may be questionable.

BOLDUAN: Do you trust that Harris had no part of this?

WOODHOUSE: I believe that. I believe it in my heart.

BOLDUAN: We will see what comes forward from the State Board of Elections.

Dallas, thanks for coming on. We'll stick with it.

WOODHOUSE: Thank you.

BOLDUAN: We'll come back on and we will talk about it more. Appreciate your time.

Coming up for us still, a powerful winter storm pummels the southeast with snow and ice. It isn't over yet. Why the worst could still be ahead for folks in the south.

[11:54:25] We'll be right back.


BOLDUAN: So the first winter storm is fading and millions in the southeast are starting to assess the damage. And the danger is not over yet.

CNN meteorologist, Chad Myers, he's tracking all of this for us.

Hey, there, Chad.

CHAD MYERS, AMS METEOROLOGIST: A little bit of melting during the day, Kate, and freezing again back at night.


MYERS: So what could have been a wet sidewalk, by tomorrow morning, will be a frozen one. That's where the danger lies in the next couple of days. Models did very well. This was not a surprise snow storm. Richmond got a little more, Charlotte got a little less than the models were saying, but temperatures now are warming up. We are in the 40s. Still some light rain coming around and that will freeze up tonight on contact with the colder air. Even though we'll be somewhere in the 40s today over the area, by tonight, back into the 20s -- Kate?

BOLDUAN: And it's just beginning.

Great to see you, Chad. Thanks so much.

MYERS: You're welcome.

BOLDUAN: Everybody, thank you so much for joining me AT THIS HOUR.

"INSIDE POLITICS" with John King starts right now.