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THE SITUATION ROOM

Mick Mulvaney Named as Acting White House Chief of Staff: Interview With California Congressman John Garamendi; Special Counsel Slams Michael Flynn's Criticism of FBI Interview; Trump Team Shifts Story on Illegal Hush Money Payments; Seven-Year-Old Girl Dies in U.S. Custody After Border Arrest; Outgoing Republican Governor Signs Last Minute Power Grab; Orrin Hatch Says He Regrets Saying 'I Don't Care' about Trump Allegations. Aired 6-7p ET

Aired December 14, 2018 - 18:00   ET

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


[18:00:01]

BRIANNA KEILAR, CNN ANCHOR: Acting out? President Trump caps a dramatic week in the Russia investigation by announcing that his budget director, Mick Mulvaney, will become the acting chief of staff. Why did he wait until tonight to make this reveal?

Mueller's rebuke. The special counsel fires back at Michael Flynn after the convicted former national security adviser tried to cast blame for his own lies on the FBI. We're getting new details on the Russia probe in just-released documents.

Substantial evidence. After Michael Cohen incriminated President Trump in court, he is publicly accusing his former boss of potential crimes in a new TV interview. The former fixer says he's given Mueller loads of proof that Mr. Trump has lied.

Border death. A 7-year-old Guatemalan girl detained in the New Mexico desert dies in U.S. custody. And we're learning more about what happened, as the Trump administration tries to deflect any blame.

We want to welcome our viewers in the United States and around the world. Wolf Blitzer is off. I'm Brianna Keilar. And you're in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

KEILAR: Breaking news tonight: President Trump filling a big hole in his White House staff after days of frustration. He announced in a tweet a short while ago that he's tapping Budget Director Mick Mulvaney to be his acting chief of staff, replacing John Kelly.

Also breaking, the special counsel is refusing to let Michael Flynn suggest that FBI agents were in any way responsible for his lies, lies the former national security adviser has admitted to in court.

Mueller's team refuting Flynn's claims in his sentencing memo and indirectly rebuking President Trump, who has tried to downplay Flynn's admitted crime, this coming as the president's former fixer Michael Cohen says Mr. Trump is lying to this day about his actions, including in relation to Mueller's probe.

I will be getting reaction this hour from Democratic Congressman John Garamendi. And our correspondents analysts are also standing by.

We will have more on the president's new acting chief of staff in a moment right now.

But let's go to CNN senior White House correspondent Pamela Brown and CNN senior justice correspondent Evan Perez.

Pamela, walk us through the special counsel's sharply worded response to Michael Flynn.

PAMELA BROWN, CNN SENIOR WHITE HOUSE CORRESPONDENT: It was really quite a scolding, Brianna, special counsel Mueller punching back at Michael Flynn's lawyers assertion that the former national security adviser wasn't appropriately warned about the repercussions of lying to the FBI.

In this new filing, Mueller's team says Flynn chose to lie weeks before the FBI interviewed him by claiming he didn't discuss sanctions with Russian Ambassador Sergey Kislyak. And they said he was committed to his false story.

This is what the filing said: "Nothing about the way the interview was arranged or conducted caused the defendant to make false statements to the FBI on January 24. The defendant chose to make false statements about his communications with the Russian ambassador weeks before the FBI interview when he lied about that topic to media, the incoming vice president and other members of the presidential transition team. When faced with the FBI's questions on January 24 during an interview that was voluntary and cordial, the defendant repeated the false statements."

So, Mueller's team also noted that the FBI gave Flynn multiple opportunities in the interview to correct his false statements, and that they only did so once the FBI used the exact language and presented it to him that he had used with Kislyak from that phone call.

Now, the filing also includes some colorful details, noting that Flynn and the FBI agents walked right past President Trump on the day of the interview as Trump was discussing art placement of the White House, but he didn't seem to notice. Neither did anyone else in the White House. And Flynn didn't introduce them.

The interviewing agents also discussed the impression of Flynn, that he was relaxed, jocular. They said he was bright, but not profoundly sophisticated, from the interview. And the agent even noted that Flynn was so talkative that the agents in the room wondered whether he didn't have more important things to do as a national security adviser.

And it's remarkable, because these details wouldn't be coming out today from Mueller's team had Flynn's attorney not sort of fought back against them about the FBI interview and the circumstances around it. KEILAR: They're saying this is -- this was your doing, very clearly,

right?

BROWN: Yes.

KEILAR: And, Evan, Mueller also released some memos. They were written by the FBI agents. This was pretty interesting, because they detail their interview with Flynn.

I wonder, just with the releasing of all of those details that are so interesting that Pamela talks about, is there a message that Mueller is trying to send?

EVAN PEREZ, CNN JUSTICE CORRESPONDENT: Well, I think, Brianna, one of the things they're trying to do is essentially squelch all of the questioning that you're hearing now from people on the right especially.

People are arguing, including the president, by the way, they're arguing that Michael Flynn may have been railroaded by the FBI. In particular, one of the memos is one from Andrew McCabe, the former acting -- the former deputy director of the FBI.

[18:05:01]

And he described a phone call with Michael Flynn, and Michael Flynn explaining why he was having these conversations with the Russian ambassador.

And he says -- quote -- "Then he stated that I probably knew what was said."

So what that calls attention to is this idea that Michael Flynn clearly told Andrew McCabe that he suspected or he thought that someone was eavesdropping on that phone call. So it really raises the question as to why he lied.

There's another memo that was attached. This is a memo that describes the FBI interview, and they described how, in middle of talking to him, one of the things they did, they repeated the exact words that Flynn used himself during his phone call with the ambassador, the Russian ambassador.

So, again, Flynn knew that they had the transcript of that phone call. And yet, according to the special counsel, and according to his own admission, he did not tell the truth, Brianna.

KEILAR: And so, clearly, I mean, they had these transcripts. This was being monitored. And what's -- what's stunning, Evan, is that, as the former DIA director, the former very good, by all accounts, intel officer, that Flynn would not be aware of that even, as in the interview, it became pretty apparent.

PEREZ: Right, exactly.

And that's one of the things that the Mueller filing today and makes clear, that they recite not only his experience, the fact that he's a national security adviser in the White House, he served more than a dozen years, decorated soldier in the military, and he was -- he ran the Defense Intelligence Agency before he was fired under the Obama administration.

So, clearly, this is not somebody that was some -- just fell off the turnip truck. He was somebody who was very experienced in this and should have known that you can't tell a lie to the FBI when they're talking to you.

KEILAR: And still the recommendation, Pamela, from Mueller's team is, there shouldn't be prison time. This guy has been very helpful in this investigation.

BROWN: That's right.

So, basically, what they were saying to the judge in these filings is that what Flynn said in his last filing, his lawyers said, shouldn't mitigate the seriousness of the crime of lying to the FBI.

But Mueller's team is still standing by its recommendation of no jail time.

KEILAR: And, Evan, some new information that we're learning about Maria Butina. This is a separate investigation, but she's an alleged Russian spy who was trying to infiltrate conservative circles.

We got some very interesting information that we were not actually supposed to see.

PEREZ: Right, exactly.

Almost as interesting as the information -- by the way, the information is that Maria Butina is cooperating with prosecutors, and she's due to go to an interview on December 18, and another one on January 17 next year.

What this filing describes is essentially permission for her to travel to the U.S. attorney's offices in Washington, as well as the Eastern District of Virginia. And, again, it talks about the fact that she is helping prosecutors with an ongoing investigation.

But almost as interesting as the details of this, Brianna, is the fact that this is not supposed to -- this was not supposed to be released minutes. After it was filed, and we were able to pull down a public copy of it, the special counsel, the courthouse withdrew the document, so it's no longer available.

By the way, the document also mentions that she's going to be providing testimony to the grand jury, again, another indication that Maria Butina is providing valuable information to the special counsel -- I'm sorry -- to the prosecutors in Washington, apparently, in Eastern District of Virginia, as well as to a grand jury that is doing an investigation.

By the way, CNN has previously reported that her boyfriend is actually somebody who is under investigation as part of this -- as part of the case that she already has pleaded guilty to.

KEILAR: All right, Evan, thank you so much.

Pamela, really appreciate it.

Now to the breaking news out of the White House, Budget Director Mick Mulvaney tapped by the president to be his acting chief of staff.

CNN chief White House correspondent Jim Acosta joining us on this story.

Tell us more about this announcement. And also very noteworthy is the timing.

JIM ACOSTA, CNN CHIEF WHITE HOUSE CORRESPONDENT: The timing is very noteworthy, Brianna.

The president appears to be dangling a bright, shiny object on this late Friday evening, selecting his budget director, Mick Mulvaney, as his new acting chief of staff. We should point out he's only been selected as an acting chief of staff.

The president apparently trying to change the news cycle here. But even today, with a momentous decision as naming a new chief of staff or an acting chief of staff, it's going to be tough to change the narrative of this new cycle with his former attorney, Michael Cohen, speaking out, and not just to the special counsel's office.

(BEGIN VIDEOTAPE)

ACOSTA (voice-over): It was fixating TV, as President Trump's former fixer Michael Cohen explained that federal prosecutors don't see his flip as a flop.

MICHAEL COHEN, FORMER ATTORNEY/FIXER FOR DONALD TRUMP: The special counsel stated emphatically that the information that I gave to them was credible and helpful.

[18:10:05]

There's a substantial amount of information that they possess that corroborates the fact that I am telling the truth.

ACOSTA: In an interview with ABC, Cohen pushed back on the president's claim that he didn't issue an order to make hush money payments to a porn star and Playboy model alleging affairs with Mr. Trump.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Let me tell you, I never directed him to do anything wrong. Whatever he did, he did on his own.

ACOSTA: Giving direction, Cohen insisted, is what the president always did as a businessman.

COHEN: Nothing at the Trump Organization was ever done unless it was run through Mr. Trump. He directed me.

ACOSTA: As for the president's claims he didn't commit any crimes, Cohen noted the critical timing of the payments, just before the 2016 election.

COHEN: You have to remember at what point in time that this matter came about, two weeks or so before the election, post the Billy Bush comments. So, yes, he was very concerned about how this would affect the election.

ACOSTA: Despite all of the investigations now touching the Trump Organization, foundation, campaign, inauguration, transition and administration, the White House is brushing off Cohen's comments, saying they shouldn't be taken seriously.

HOGAN GIDLEY, WHITE HOUSE DEPUTY PRESS SECRETARY: He's a self- admitted liar. You guys all know that. And for him to say, I'm going to start -- I'm going to stop lying now, starting now, is somewhat silly.

ACOSTA: But cracks maybe starting to form under the president's feet. Consider those GOP lawmakers all but lining up to back the president earlier this week, as Senator Orrin Hatch did with CNN's Manu Raju.

SEN. ORRIN HATCH (R), UTAH: The Democrats will do anything to hurt this president.

MANU RAJU, CNN SENIOR POLITICAL CORRESPONDENT: But this is not the Democrats. It's the Southern District of New York.

HATCH: I don't care. All I can say is, he's doing a good job as president.

ACOSTA: Hatch released a statement saying he regretted those remarks, adding: "I made comments about allegations against the president that were irresponsible and a poor reflection on my lengthy record of dedication to the rule of law."

As for the other reality show unfolding at the White House, the president dangled a bright, shiny object, selecting his budget director, Mick Mulvaney, as his new acting chief of staff.

One other top contender, New Jersey Governor Chris Christie, had pulled himself out of the running earlier in the day, saying in a statement: "It's an honor to have the president consider me as he looks to choose a new White House chief of staff. However, I have told the president that now is not the right time for me or my family to undertake this serious assignment."

It was always a stretch to see Christie in that role, given his criticism of the president for hiring family members for key posts.

GOV. CHRIS CHRISTIE (R), NEW JERSEY: The situation is made much worse by the fact that, when you have family members in the White House, it makes it much more difficult. And there were many of us who counseled the president not just about Jared, but about any other members of his family having official positions.

ACOSTA: One thing is clear in this photo tweeted this week showing former Chief of Staff Reince Priebus and the outgoing John Kelly. They both look much happier.

(END VIDEOTAPE)

ACOSTA: Now, one thing we should point out about the outgoing chief of staff, John Kelly, a senior administration official just told reporters that Kelly will be staying on until the end of the year, and then Mick Mulvaney will be taking over as the acting chief of staff.

And that senior administrative official tried to clean up some of the confusion over why Mulvaney is being named an acting chief of staff at this point, Brianna, this official telling reporters that he is the acting chief of staff, which means he's the chief of staff.

That is very confusing language coming from the White House, not really cleaning things up. The other confusing aspect of all of this, Brianna, is that Nick Ayers, the vice president's chief of staff, was willing to be the new chief of staff over here at the White House. But he wanted to do it on an interim basis.

The president apparently rejected that, wanted a permanent chief of staff. And here he is on this Friday evening, after all that Michael Cohen news, all that Russia investigation news all week long, the president suddenly, on a Friday evening, saying he's OK with an acting chief of staff -- Brianna.

KEILAR: It is all very confusing, but thank you for trying to clear it up, Jim Acosta, at the White House.

ACOSTA: You bet.

KEILAR: Let's turn now to this breaking news that there is a new acting chief of staff, who may be the chief of staff. I'm not sure.

We're joined by Congressman John Garamendi. He's a Democrat who serves on the Armed Services Committee.

We have a number of things to ask you about. There's so much breaking news this evening. But on this chief of staff news, what do you think about the timing of this?

REP. JOHN GARAMENDI (D), CALIFORNIA: I don't know, but it just seems, Brianna, this is a terrible, terrible problem for "Saturday Night Live."

You don't have to wait to Saturday night to have, oh, my goodness, what's going on here? It is absolutely crazy time. Mulvaney has now three jobs. First of all, acting is the right word. The president has not had a chief of staff.

He's trying to do it all by himself, and the result is ultimate chaos. So, Mulvaney is going to be acting chief of staff. He also is running the Consumer Financial Protection Bureau. And he is the director of the Office of Management and Budget.

That office alone is enough to keep five people busy. Bottom line of all this is ultimate chaos, chaos in the operation of the most important government in the world. And it is a serious, serious problem.

[18:15:12]

I don't know what he's going to do there, perhaps just hold the title acting, which is probably appropriate.

KEILAR: This comes, of course, as there's been so much news about Michael Cohen, about Michael Flynn and the special counsel putting out filings today that show a rebuke of Michael Flynn's lawyers basically blaming the FBI for his lies.

GARAMENDI: Yes.

KEILAR: Trump yesterday tweeted that the special counsel -- quote -- "gave General Flynn a great deal because they were embarrassed by the way that he was treated."

This filing by the special counsel, at least indirectly, rebukes that. What message do you think Mueller is sending with this new document?

GARAMENDI: He is sending, don't mess with me.

He's being very, very clear here. I have got the goods on you. Don't mess with me. If you want it all to come out in a filing, you're going to get it to come out. So, if you're playing games with me, you have made a mistake.

It's just very, very clear. It goes way back. Flynn was lying weeks, weeks before he ever became the director of -- in the Oval Office. When he got that position, he continued to lie. It's his problem. And, OK, bottom line of it, Mueller has the goods on certainly Flynn, certainly on the others, and quite probably on the president.

KEILAR: Why do you think that Flynn, then the national security adviser, formerly the director of the CIA, a respected intelligence officer prior to that, he lied to those FBI agents, when he understands how these things work?

And, clearly, those agents had the transcripts. When you know that, that they clearly have the transcripts of his conversations with the Russian ambassador, that he should have, that he would have known that, why do you -- what questions do you have about his lies?

GARAMENDI: Well, I think it's about hubris.

I remember very, very clearly, the day of the inaugural, the members of Congress were sitting there in the stands behind the president. Flynn was talking to the Joint Chiefs, the members of the Joint Chiefs of Staff, in a very puffed-up way. You could just see that this man was very, very taken by himself as he was talking to the members of the Joint Chiefs of Staff. We were sitting not more than 15 feet behind him. And I was thinking

to myself, there's something here about him that is not good. He has too high opinion of himself.

And so when the FBI came along to question him and to ask him, I think he thought he ruled the world and didn't have to respond to anybody. And he certainly, certainly was not wise or careful.

KEILAR: President Trump also attacked Michael Cohen, as you know, his credibility.

But Cohen says, look, this isn't my word against the president's. He said the special counsel has substantial, as he put it, evidence as well.

What type of evidence do you think they might have?

GARAMENDI: Tapes and other people that were in the meeting. We know that the president of the AMI, the publisher of the book -- of the magazines, has already stated in a filing that Trump, Cohen and he were all in the same meeting together discussing the issue of how to keep people quiet.

And that was at least a year before the election. And so I'm quite sure that everything that Cohen and certainly anything that the prosecutors in the Southern District of New York are using and will bring forward is very, very well backed up by the words and the physical information that's available.

There's collaboration on all of this.

KEILAR: We have learned a lot more about these investigations in the past two weeks. Are these developments having any influence on your Republican colleagues? Do you talk to any of them? Do you think that any of them are thinking differently about the president's involvement here?

GARAMENDI: Oh, there's no doubt about it. There's absolutely no doubt that the Republicans...

KEILAR: They're telling you that?

GARAMENDI: In quiet conversations, you can see that they're -- they're very worried, they're very concerned about what's going on here.

And they know that, ultimately, all of us in Congress are going to face a question about, how do we proceed? Do we follow the Constitution, carry out our obligations to hold the administration accountable?

And I think they will want to do that. And earlier in the show, just a few moments ago, you gave, I think, a prime example of a very substantial Republican senator that suddenly woke up and said, oh, my God, did I really say that? I really didn't mean to say that.

KEILAR: Orrin Hatch.

GARAMENDI: Exactly. He backed up so fast, he probably hit the wall on the way back.

KEILAR: All right, Congressman John Garamendi, thank you so much for being with us. We do appreciate it.

And just ahead: Why did Michael Flynn lie, when he seemed to know that investigators had evidence, transcripts, that would prove he wasn't telling the truth?

[18:20:00]

And will Mick Mulvaney bring order to the Trump White House? We will have more on Mr. Trump's pick of his budget director to be his acting chief of staff.

(COMMERCIAL BREAK)

KEILAR: We're following late-breaking news from the White House, President Trump announcing a replacement for outgoing Chief of Staff John Kelly, after days of frustration.

Mr. Trump says his budget director, Mick Mulvaney, will fill the role temporarily. And this is an announcement that comes just hours after Michael Cohen's bombshell TV interview filled with new accusations against the president.

[18:25:00]

Let's bring in our analysts to talk about all of this.

And we keep getting more details from the special counsel, big stories today that have to do with things that Donald Trump is seething about. We know that. Our reporters are telling us that.

But he tweets out that he's going to have this acting chief of staff, Mick Mulvaney. What do you think about this timing and this pick?

MARK PRESTON, CNN POLITICAL EDITOR: Well, the timing shouldn't be too surprising to any of us.

I mean, the fact of the matter is, Donald Trump likes to try to change the topic when he possibly can. Now, the problem with this is that this isn't big enough. This isn't a big enough story right now to overshadow the situation we're in right now.

But I will say this. You are looking at a White House that is in full-blown crisis mode at this point, full-blown crisis mode. And by putting Mick Mulvaney in there right now, he's somebody that the president can trust. Mulvaney has shown that he is somebody that will stand by the president's side. And that's what he needs right at this moment.

KEILAR: Does he want the job, though? Because he's the acting, but Jim Acosta just reported that he talked to a White House official who said, when he asked, well, what does this mean he's acting White House chief of staff?

And the response was, well, he's the chief of staff.

PRESTON: I think that's right. I think it would be very hard for him to say, I don't want to do this job anymore. I think that he very well may be in that job for the long haul.

But let's be very clear about this. The most important job for the president right now is going to be, who is the person out there speaking on his behalf and who's his lawyer representing him?

KEILAR: Yes, very key.

PHILIP MUDD, CNN COUNTERTERRORISM ANALYST: Can we -- just one slightly different perspective on this, because in this town of Washington...

PRESTON: How dare you?

(LAUGHTER)

MUDD: Don't interrupt me.

(LAUGHTER)

MUDD: Because, in this town of Washington, D.C., there's going to be a lot of political spin on this.

I think you could step back outside the Beltway and say, the psychology of this is much simpler. People are making fun of the president left and right. He is the president of the United States. This is one of the most powerful positions on the planet sitting next to him, his chief of staff.

And a 35-year-old Nick Ayers says, I don't want to do it. Everybody else on the planet says, I don't want to do it.

I think, in addition to saying maybe he wants to spin the cycle, he's sitting back saying, I'm getting tired of people making fun of me. I look like an idiot. I'm going to have somebody in on Friday night.

PRESTON: I agree with you, actually.

I mean, that's the whole full-blown crisis mode, though, the idea of, look, let's plug the hole, then move on. You are right.

(CROSSTALK)

SHAWN TURNER, FORMER NATIONAL SECURITY COUNCIL MEMBER: And, to be clear, the reason he's the acting is because, just like all those others, Mick Mulvaney does not want this job.

KEILAR: And perhaps this -- that had been our reporting, so perhaps this will give him some type of exit, if needed.

But, look, you talk to White House officials, and it sounds like they're saying, well, surprise. Mick Mulvaney, this may be your -- this may be your baby. You can't give it back.

OK. So, yesterday, the president says -- quote -- "They gave Michael Flynn a great deal" -- he's talking about the special counsel -- "because they were embarrassed by the way he was treated. The FBI said he didn't lie, and the overrode the FBI. They wanted to scare everybody into making up stories that are not true by catching them in the smallest of the statements. Sad."

So then fast-forward to today, Laura Jarrett. There are these filings out that show exactly how all of this went down. And it, at least indirectly, rebukes what the president said.

LAURA JARRETT, CNN JUSTICE CORRESPONDENT: I think directly rebukes it.

I think...

(CROSSTALK)

KEILAR: You think this was much about rebuking him as it was about rebuking Michael Flynn's lawyers for saying, oh, the FBI caught him off-guard?

JARRETT: I don't know that that was their intent, but it was certainly the output of it.

KEILAR: Yes.

JARRETT: I mean, everything they do almost point by point destroys the tweet. He didn't get a great deal because they were embarrassed. He got a great deal because he's been cooperating from day one.

And I think the filings show how the FBI actually went out of their way to say, let's do this quietly. Let's try to resolve it discreetly. And let's get this done, much to the chagrin of the Justice Department, didn't inform them, went about it, got them in there on that day to interview him.

Two FBI agents come back and say, you know what? He didn't even show any deception. He didn't even show any physical manifestation of his -- of his lies, knowing full well that he had lied, because they had him on tape. But it just meant he was a really good liar.

And so that's, I think, the question for all of us, is, why was he lying, when he knew going into it, they have me on tape saying something completely different?

KEILAR: And, Shawn, it sounds like Mueller was really -- as he is trying to protect his investigation and protect the process, he was really not happy with Michael Flynn's lawyers, with how they just kind of tried to blame this on him being caught off-guard.

TURNER: Absolutely, he was not.

And you can see that in all the detail that he laid out. And I will tell you that Michael Flynn is very lucky today, because Mueller's team could have very easily taken a look at this and said, we tried to help you out here. We said to the judge directly that we don't think that you should get any significant time.

And I think that one of the things that the Mueller -- that Flynn should be very happy about is, he should understand that judges don't like to have their intelligence insulted. And when his lawyers went in there and said, well, the FBI may have kind of pushed this guy into lying by not telling him that it was a problem to lie to the FBI, the judge is going to look at him and going to say, come on. Do you really think I'm going to buy that?

And so I don't think Flynn will get any time. But, if he doesn't, it's only because Mueller and his team decided that they were going to stick with the original deal.

KEILAR: Wow. I mean, that is something, Shawn.

And, Phil, the FBI agents described their strategy. They're interviewing Flynn, and they write this. If Flynn said he did not remember something they knew he said, they would use the exact words Flynn used, such as -- and it's redacted -- to try to refresh his recollection.

[18:30:17] Well, the expectation is what that redacted part is talking about, a transcript of his phone call with the Russian ambassador.

PHIL MUDD, CNN COUNTERTERRORISM ANALYST: Refresh his recollection, like he didn't remember. I mean, there's some traditions in America. There's Mom, there's apple pie, there's the tooth fairy. And then there's the great tradition of how the FBI investigates and questions people.

You are not going to walk in and say, "Here, we have this transcript of your phone call with the Russians." You're going to start with the big question. "Can you talk about your interactions with the Russians during the campaign," anticipating that Flynn's going to give you something. He doesn't.

Then you're going to narrow it down. "Can you specifically talk about your interactions with Kislyak?" He doesn't say anything.

You're going to give him chance after chance, and when he finally ties himself up in knots, you're going to say, "Did you ever say anything about X, Y and Z as the transcript suggests?" At that point if he says no, he's done. That's a 1001 violation. That's lying to a federal officer.

LAURA JARRETT: I mean, remember, he's the head of an intelligence agency. This is not some sort of doe-eyed hapless man the way that the president's tweets and Rudy Giuliani it is being tweeted about, that it is a perjury trap. I mean, that just sort of belies what we know about Michael Flynn. This is someone who -- whose career escalated to the highest levels of national security.

KEILAR: Because we should be clear, director of the DIA.

JARRETT: Yes.

KEILAR: This is a former respected intel officer. So these kinds of resources that the FBI had at their disposal, he is well aware of them.

JARRETT: Yes. And they're struck by the fact that he's talking about all kinds of other stuff in this interview, seemingly happy to spend as much time with them as he wants. I mean, he's talking about artwork. He's talking about all of these other random things to the FBI agents, who he knows are there to talk about his interactions with Kislyak.

MUDD: How hard is it for an intel guy to think that they're listening to the Russian ambassador? How -- what is that?

KEILAR: Here's what I wonder. With the knowledge that they would have been listening and the fact that they're basically reading the transcript to him, why would he still lie?

SHAWN TURNER, CNN NATIONAL SECURITY ANALYST: Here is what I -- here is the reason that I think Michael Flynn lied. So Michael Flynn went from having a mediocre tenure as director of the Defense Intelligence Agency to being the national security advisor.

KEILAR: He was fired as DIA director.

TURNER: A meteoric rise. And so when he went into this circle with Trump, and Manafort and Cohen, he found himself in a space where these are the kind of people who do what they want to do, and they protect each other.

So here you have Flynn, who's done something for the administration, for this team, and he's lied about it. And he watches what happens with them, and he thinks, "They're going to protect me. They're going to watch out for me." And I think when he sat down with those FBI agents he thought, "I'm OK. I'll be fine."

MARK PRESTON, CNN POLITICAL ANALYST: It's almost absurd that we have to have a conversation that a decorated general in the United States armed services doesn't know that, in fact, he could be being taped by the FBI. That the questions he's being asked about his interactions with a foreign government, that full well they know that he's not answering them. You have to and wonder, does it come down to President Trump offering him some kind of clemency, or at least a wink and a nod?

KEILAR: All right. You guys stand by for me. We have so much more breaking news. We'll be right back here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

[18:38:01] KEILAR: And we are back now with our wonderful -- wonderful team of analysts to talk about a new apology from an outgoing senior U.S. senator.

Orrin Hatch, initially asked, as you guys know, about Donald Trump being implicated in these felonies that Michael Cohen pled guilty to and he essentially said, "I don't care. He's doing a great job as president." He has now reversed that.

What do you think about that, Laura?

JARRETT: It's a stark reversal, especially in D.C. You don't see people sort of backtrack in that way. I mean, it took him a couple of ways. He didn't do it right away.

But, you know, Manu Raju chases lawmakers all over Capitol Hill every single day, asking them what they think about the fact that all of these close associates of the president have now pled guilty or at least are implicated in serious federal crimes. And most of them say things either in line with what Senator Hatch said or around it. You don't hear a lot of people strongly condemning this or talking about the rule of law. Or they mention Mueller in terms of wanting the probe to continue, but you don't see many people do anything other than really shrug it off.

KEILAR: It's also that -- that Hatch said, "I don't care" when he was asked about something that's sort of -- he even says this in his response. Essentially, you know, he's worried about how this makes his dedication to the rule of law look over the years.

TURNER: Yes, and I think that while people probably got to him and fairly quickly made him realize the error of his ways, I also think it's the case that, while I don't think there's necessarily a sea change that's represented here, I do think it's the case that Republicans are starting to realize that the president's political and legal troubles have the potential to consume the entire party.

And so while I think that, if this happened six months ago it's unlikely that we would have heard Orrin Hatch say anything at all, I think where we are today makes this the kind of thing he's got to speak out on.

MUDD: I can't figure this out. I mean, this country has said from day one that we're a country of values. And now we're saying, because we see evidence of a legal violation, we're going to think about it.

The president starts a campaign by lying about President Obama. Sean Spicer says -- he lies within about 20 minutes of getting into office. Everybody else, including Hope Hicks, Michael Cohen, Paul Manafort, they all admit they lie.

And finally we say -- and Orrin Hatch is a good man, but finally we say, "Wow." But forget about values. If there's actually evidence that the law was broken, maybe the family values party will sit up and say, "Oh, we ought to take notice." What happened before? Was that OK? I don't know.

PRESTON: Yes, this is what is so disappointing about what Orrin Hatch said. I remember eons ago as a young reporter being on Capitol Hill and seeing the likes of John Chaffee and John Warner, and seeing the likes of Orrin Hatch and Ted Kennedy try to work together. And they got together, and they were called the old bulls. And there was a bit of decorum, and there was a bit of -- of a moral compass that, in fact, we would see from Orrin Hatch.

And when he said these comments the other day, I thought to myself, "Wow, he is leaving on such a bad note."

KEILAR: It's a bad swan song, indeed.

All right, you guys. Thank you so much. Really appreciate the discussion.

Next, we'll be looking at the president's shifting story about hush- money payments and what he knew about them.

(BEGIN VIDEO CLIP)

DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: We need border security. We need security from drugs.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

[18:45:34] BRIANNA KEILAR, CNN HOST: Tonight, in the face of new questions about Donald Trump's involvement in illegal hush money schemes, the president and his legal team are shifting their story once again.

Our Brian Todd has been tracking these evolving explanations.

Brian, give us the latest.

BRIAN TODD, CNN CORRESPONDENT: The latest, Brianna, is that President Trump has given conflicting accounts of the kind of legal work that Michael Cohen did for him. Tonight, we have broken down the contradictions, the shifting stories that Trump and his legal team have given about the money paid to keep two women silent.

(BEGIN VIDEOTAPE)

TODD (voice-over): The hush money payments to Stormy Daniels and Karen McDougal may once have seemed embarrassing personally to President Trump, but tonight they now threaten to harm him legally. Experts say that may be why the president's story keeps changing, going from, I didn't know to it's not my fault to it's not illegal.

In a new interview with ABC, Trump's former lawyer, Michael Cohen, says Trump absolutely directed him to make the payments to Daniels and McDougal and did it with a specific purpose in mind, winning the presidency.

MICHAEL COHEN, PRESIDENT TRUMP'S FORMER ATTORNEY: He was very concerned about how this would affect the election.

GEORGE STEPHANOPOULOS, ABC NEWS ANCHOR: To help his campaign?

COHEN: To help him and the campaign. TODD: That, experts say, would be a violation of campaign finance law

which may be why the president is blaming his lawyer for bad advice, tweeting Thursday morning: I never directed Michael Cohen to break the law. He was a lawyer and he is supposed to know the law.

But that argument hardly lasted half a day because just hours after tweeting that, Trump told Fox News Cohen barely did legal work for him.

INTERVIEWER: That was his title, a fixer.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Very low level work. He did more public relations than he did law.

INTERVIEWER: Why did you need him then?

TODD: But back in April, the president had a different view of Cohen on air force one when he denied knowing about the Stormy Daniels' payment.

REPORTER: Mr. President, did you know about the $130,000 payment to Stormy Daniels?

TRUMP: No, no. What else?

REPORTER: Then why -- why did Michael Cohen make this, if there was no truth to her allegations?

TRUMP: Well, you have to ask Michael Cohen. Michael is my -- an attorney. You have to ask Michael.

TODD: In August, his story changed again when Trump was asked by, yes, another Fox News anchor if he knew about the payments?

TRUMP: Later on I knew, later on. But you have to understand, Ainsley, what he did -- and they weren't taken out of campaign finances.

TODD: Experts say that argument may not hold water, especially because the president according to a source was at a meeting in august of 2015 discussing hush money payments with Cohen and David Pecker, the CEO of "The National Enquirer's" parent company.

(on camera): Does it give him an out to say that, I knew about it later?

LARRY NOBLE, CAMPAIGN FINANCE, ETHICS EXPERT: No, it doesn't give him an out that he knew about it later. Once he knew about it, he was -- he was party to the violation.

TODD (voice-over): Another shift in the story comes from Trump's legal adviser Rudy Giuliani. On May 2nd, Giuliani told Fox that Cohen who took out a personal home equity line to pay for Stormy Daniels' silence was paid back by Trump.

RUDY GIULIANI, TRUMP ATTORNEY: The president reimbursed it. TODD (on camera): The reimbursement comment, is that an admission

that he knew about the payments earlier?

NOBLE: Yes. That's an admission that he knew about it earlier. Why would Trump reimburse him if he didn't know about the payment?

TODD (voice-over): In that same interview, Giuliani suggested that paying Cohen back meant Trump hadn't violated campaign finance laws.

GIULIANI: That money is not campaign money. I'm giving you a fact you don't know. It is not campaign money. No campaign finance violation. So --

SEAN HANNITY, FOX NEWS HOST: They funneled it through the law firm?

GIULIANI: Funneled through the law firm and the president repaid it.

TODD: Experts say the repayment of Cohen which prosecutors say came in the form of fake retainer payments to him from the Trump Organization still means there are probably campaign violations and may have violated other laws, too. That maybe why Trump suggested another version of the story on Thursday when he denied paying back media conglomerate AMI, that parent company of "The National Enquirer", for its role in hush money payments to McDougal.

TRUMP: I don't think they even paid any money to that tabloid, OK? I don't think we made a payment to that tabloid.

NOBLE: By not paying them back, you have a straight-out corporate contribution to the campaign.

TODD: In fact, it may make it worse, all of which experts say begs the question, are all of these shifting stories taken as a whole a crime?

NOBLE: To support the idea that he has committed crimes, whether it is the knowing and willful violation because he's trying to hide it, showing he knows there's something wrong here, and it also can be an element of obstruction of justice, that he is trying to influence other witnesses, if he is trying to influence the jury with lies.

(END VIDEOTAPE)

[18:50:07] TODD: But experts caution there's also the possibility all of these shifting stories in totality may actually not prove obstruction of justice simply because we don't know everything that Trump and his legal team have told to prosecutors, and they say that Trump and his team could make the case that the president was confused about the law, confused about what obstruction really means, even though he's always had lawyers to tell him what that means -- Brianna.

KEILAR: All right. Brian Todd, thank you very much.

Now, just ahead, a migrant child detained by U.S. border agents dies in custody. The Trump administration is on the defensive as we're learning new details about what happened. (COMMERCIAL BREAK)

[18:55:23] KEILAR: Tonight, homeland security officials are defending the way that border agents responded to a 7-year-old girl who became violently ill and died in their custody. But the case is sparking outrage and escalating concerns about the Trump administration's treatment of migrant children.

CNN's Martin Savidge is covering this story.

Walk us through this, Martin, what happened to this young girl, Jakelin Caal Maquin.

MARTIN SAVIDGE, CNN NATIONAL CORRESPONDENT: Everyone agrees, Brianna, that this is a tragedy, where there's disagreement as to who's to blame. It begins on December 6th in a very remote part of New Mexico at about 9:00 in the evening when three border patrol agents find a large group, 163, what they believe are undocumented migrants who have just come across the border from Mexico. In that group, a father and daughter, they're from Guatemala.

The group is so large that it takes two buses to transport them back to the main station which is an hour and a half away. The father and daughter are on that second bus. It's now 4:00 in the morning when the father reports his daughter has stopped breathing. She was vomiting and seemed to have a high temperature.

EMTs are summoned. They bring her back to life, get her to the station and then realize she is so bad off, they fly her to a children's hospital in El Paso. But tragically, she died there less than 24 hours later.

It's later determined by doctors she was dehydrated and had died of septic shock. So now what people are asking is, was there something about the way she was detained or how she was apprehended that might have delayed proper medical treatment, or, in fact, may have contributed to her condition and her death. That's being investigated.

DHS has put a statement out and they say unequivocally that without life-saving measures undertaken by border patrol, this child would have likely died in the desert alone without any medical care whatsoever. The entire department is heartbroken by this loss of life.

But as you pointed out, Brianna, this once again brings up the whole issue of is this a heartless administration that's at fault here, or is it the father and those that came from Guatemala taking a 7-year- old child across a very difficult and desert-like land, Brianna?

KEILAR: That was certainly the point that the DHS secretary made, the latter one.

Martin Savidge, thank you so much for that report.

Also new tonight, the outgoing Republican Governor of Wisconsin has signed legislation stripping his successor, a Democrat, of some executive powers.

And our political reporter Rebecca Buck is here with this story for us. How consequential is this move by Governor Scott Walker?

REBECCA BUCK, CNN POLITICAL REPORTER: It's a major controversial move by Governor Walker, Brianna.

Just a month after he lost reelection to Democrat Tony Evers, sending a very strong message on his way out the door that he isn't afraid to curb some powers of the incoming administration, even as Democrats are calling this something of a sore loser response at best and at worst, an unconstitutional power grab by Walker and Wisconsin Republicans in the statehouse.

Walker says that's all hype and hysteria and he said in a statement today that these measures do nothing to fundamentally diminish executive authority, but Democrat Tony Evers responded, saying, Walker chose to ignore and override the will of the people of Wisconsin. This will no doubt be Scott Walker's legacy. The people demanded a change on November 6th, election day, and they asked us to solve problems, not pick petty political fights.

And so, this is just the beginning. There could be legal challenges down the road, and in fact, Democrats are planning on challenging this in courts. So we'll see where it goes.

KEILAR: And Ohio Governor John Kasich took issue with this. He basically said what Democrats are saying and when you look at this, Rebecca, it's very clear that there are powers that will be limited, whether it's appointment powers, for instance. There's a series of things that are going to be pared down for the governor in the incoming Democratic A.G.

BUCK: Absolutely. And these measures also limit what Evers is able to do in terms of implementing some of his fundamental campaign promises. One of the things he wanted to do was withdraw Wisconsin from the multistate lawsuit against the Affordable Care Act.

Now he won't be able to as a result of this measure. It blocks him from being able to do so, and so Democrats are saying he's coming in with his hands tied on some of these fundamental policy issues that were central to the campaign, and they say voters made their voices heard on those issues by electing Evers over Scott Walker.

KEILAR: All right, Rebecca, also happening in Michigan, worth noting as well.

Rebecca Buck, thank you so much for that report.

I'm Brianna Keilar. Thank you so much for watching and being with us here in THE SITUATION ROOM.

"ERIN BURNETT OUTFRONT" starts right now.