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Trump Foundation Agrees to Dissolve Under Court Supervision; Senate GOP Drafting Short-Term Deal to Prevent Shutdown; Hacked European Cables Reveal Anxiety About Trump; U.S. Prepare for Full and Rapid Withdrawal from Syria; Senate Overwhelmingly Passes Bipartisan Criminal Justice Bill; Former AG Loretta Lynch Testifies on Capitol Hill; U.S. Futures Higher Ahead of Fed Meeting. Aired 9-9:30a ET

Aired December 19, 2018 - 09:00   ET


[09:00:00] JIM SCIUTTO, CNN ANCHOR: -- a full and rapid withdrawal of U.S. troops from Syria. We are told that President Trump has ordered this withdrawal.

CNN's Barbara Starr, she's at the Pentagon with more.

Barbara, ISIS on the rise. This also a big win for both Turkey and Russia.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Good morning to both of you. It appears that President Trump made the decision yesterday to do this, to order these troops out of Syria. About 2,000 U.S. forces will be coming out of their positions on the ground in what is being described as a full and rapid withdrawal.

Now there are still other options potentially. The U.S. can launch artillery strikes into Syria from across the border in Iraq. There could be air strikes. We don't really know what the full plan yet is going forward, but it raises some interesting questions. Of course, we don't know now what will happen to the thousands of local forces on the ground that the U.S. has been training for the last several years, and we don't know what the reaction will be from Russian and Iranian- backed forces on the ground in Syria.

Those forces have been very active, controlling a good deal of ground, launching their own missions. So it's really -- it's not a massive surprise. President Trump had wanted to get out of Syria. The timing is a little odd, a bit unexpected, and we don't know what will happen now going forward. That is really the question. The big unknown.

ISIS is on the rise, as you say, Jim. There have been any number of attacks there and there are still potentially hundreds to thousands of ISIS forces and ISIS loyalists in eastern Syria. And what propaganda value they may try and take out of a U.S. withdrawal could be a very major question -- Jim, Poppy.

POPPY HARLOW, CNN ANCHOR: Absolutely. Barbara Starr, thank you for the important reporting this morning.

And you can't overstate the significance of this. This is the president's decision and the president's decision alone. Let's get reaction from retired Lieutenant Colonel Rick Francona.

Colonel Francona, so much to cover on this front, but when the U.S. says, OK, we're done, who does that hand this over to? Largely Russia, right?

LT. COL. RICK FRANCONA, CNN MILITARY ANALYST: Well, Russia, Iran and the Turks. I think that one of the big considerations we have in northern Syria is our relationship with Turkey. It's been very strained lately and the president -- as U.S. forces supporting what the Turks believe to be a terrorist organization have really put a crimp in our NATO relationship. So I don't know if the president is reacting to the Turks here or if he's just ready to do the withdrawal that he's wanted to do all along.

I'm very concerned, as Barbara said, about the timing now because the Syrian Democratic Forces, that Kurdish heavy force that we've been training and working with and supporting, has just taken the last remaining stronghold from ISIS in the Euphrates Valley. They are on the cusp of pretty much moving ISIS out of that area, and now is the not the time to pull back our support.

Yes, we'll continue to air strike. Yes, we'll continue artillery. But having U.S. forces on the ground there has really been key and has really given the SDF that extra push that they need. So I'm a little surprised. I'm a little disappointed.

SCIUTTO: So you say this benefits Russia. It benefits Iran. It benefits ISIS. What is the benefit here for the U.S. and U.S. national security?

FRANCONA: Well, the United States -- well, the president has wanted to get out of Syria. He does not believe we have a long-term presence there. And that's at odds with many of his analysts and advisers. Many of them have been saying, Mr. President, we need to keep a force there until we resolve this situation in Syria. By pulling forces out, you pretty much hand control of the country to the Russians, Iranians, and yes, in the northern part, the Turks.

And, you know, this is just another instance where we're pulling out and leaving an ally there on the ground. And, you know, in the past we have pulled back and left the Kurds on their own and it has not worked out well for the Kurds. So I think this is going to be, you know, very, very difficult for the Kurds to accept. So we'll see what happens here.

HARLOW: When you talk about what this means for ISIS and being a fertile ground for ISIS to thrive should the U.S. make this move, the Defense Department inspector general report recently estimated you've got as many as 30,000 ISIS members in Syria and Iraq. And you look at about the 2,000 U.S. troops on the ground in Syria that have been doing this training and have been successfully training especially the SDF.

What does this mean, though, for the ability to ISIS to gain -- for ISIS to gain power as a result of U.S. withdrawal? FRANCONA: Yes. This is the real key here, Poppy. The -- you know,

ISIS has -- since they've lost most of their territory, has changed their focus, they've changed the way the organization works and they've gone back to being more of a gorilla organization. And most of those 30,000 you're going to find them in Iraq, not really in Syria. They are really being cleaned out of Syria and pushed back into Iraq.

The Iraqis are trying to stop that. But we're seeing a lot of ISIS recruitment in northern Iraq, in central Iraq.

[09:05:03] And that's where you see a lot of fighting still going on. We can't count ISIS out. And, you know, the Iraqis are probably not going about this the right way. They're trying to not include the Sunnis in the government. And when you have the Shia-heavy Baghdad government putting pressure on the Sunnis, the Sunnis are driven to recruit into ISIS. It's a fact that the Iraqis are going to have end. I don't think the presence of American forces is going to stop that.


SCIUTTO: Lieutenant Colonel Rick Francona, thanks very much.

Listen, you'll remember, Poppy, the president criticized President Obama brutally during the campaign for withdrawing U.S. forces from Iraq, which of course helped lead to ISIS's rise there as ISIS is regrouping in northern Syria. This is a decision with consequences.

HARLOW: And the reality is different when you're the president. Right? In making those decisions. We'll stay on this.

So far this morning no reaction from the president to that court hearing, that dramatic hearing yesterday for Michael Flynn that very nearly ended with a prison sentence for his former National Security adviser.

SCIUTTO: Yes. And blew up stories from the White House. The president's advisers that Flynn had been entrapped into lying by the FBI. An irate federal judge and Flynn himself dismantled those claims that he'd been ambushed by FBI agents, yet the White House even after his lawyer, Michael Flynn himself, repeating in that courtroom he was not entrapped. The White House just a couple of hours later, sticking by those claims, sticking by Flynn for now.

CNN's Kara Scannell, she's live in Washington. She's been following every development in this case.

Listen, the hearing was utterly inconclusive, at least on the sentencing.


SCIUTTO: But very clear from the judge, from Flynn himself, from his lawyers' admissions that he lied willfully, that he wasn't tricked into lying. KARA SCANNELL, CNN WHITE HOUSE CORRESPONDENT: That's right, Jim. I

mean, what a dramatic hearing yesterday after what everyone thought was going to be a rather mundane sentencing with the special counsel recommending that Flynn get little to no jail time for his cooperation. But his lawyers injected into this this notion that he was tricked by the FBI into -- when he spoke with them that he wasn't properly warned, that what he told them would potentially be a crime.

And so his lawyers injected this and the judge really grasped on it. There was this exchange that happened between the judge and Flynn and his lawyers so the judge asked Flynn's attorneys was Flynn entrapped by the FBI. Flynn's lawyers said no, your honor. Then the judge asked Flynn, are you continuing to accept responsibility for these false statements, and Flynn said, I am, your honor. That was --- you know, that really consumed much of the hearing. And then the judge even went further saying, you know, was Flynn acting treasonous. And it really just changed the events and it led to this notion that Flynn -- it was very clear in court from our colleagues there that Flynn was likely to be sentenced for prison time despite the words of the special counsel's office substantial cooperation.

So the hearing really turned much more dramatically than anyone anticipated. And in the end the judge said that, you know, Flynn would -- Flynn's attorney said that he would wait and further offer additional cooperation that the judge could consider. His sentencing is now going to be put off at least until March. And then after the hearing, where he said, you know what, Flynn has been operating without any travel restrictions. So almost adding more to the pain he then imposed travel restrictions on Flynn that he hasn't had for more than a year -- Jim and Poppy.

HARLOW: Right.

SCIUTTO: Yes. Yes.

HARLOW: And Kara, before you go, we now have this letter from candidate Trump, a letter of intent to build the Trump Tower in Moscow, a project of great interest to a number of parties right now that didn't come to fruition. But what does this letter of intent show?

SCANNELL: So this letter of intent was signed in October of 2015 by Donald Trump. It was part of their effort to try to build a Trump Tower in Moscow. It was not binding, but it indicated that Trump's -- the Trump Organization's desire to build this project in Moscow and move forward to it. Of course this is controversial now because Michael Flynn had gone and told Congress that this project and all discussions of it ended in January of 2016.

Then he pled guilty saying that he lied about that and the conversations continued until at least June. And now Rudy Giuliani is saying over the weekend that these conversations and Trump answered questions to the special counsel's office indicating that perhaps these conversations even continued after the campaign right up until the election into November of 2016 -- Poppy.

HARLOW: Got it.

SCIUTTO: Kara Scannell, thanks very much.

With us now our CNN legal analyst Ross Garber, and from the "New York Times," CNN political analyst Lisa Lerer.

Ross, if I could begin with you, someone who spent a lot of time in courtrooms, have you ever seen an upgrading like that from a judge to a -- a cooperating defendant, we should note here, and what do you think was behind it?

ROSS GARBER, CNN LEGAL ANALYST: So this was extraordinary. I wish I could say I've never seen a situation like this or been involved in a situation like this, but occasionally it happens. And I think it's a reminder that federal judges are independent. And the federal system, it's the judge who determines the sentence. And what sometimes happens, and I think what happened yesterday, was the prosecution and the defense, they sort of had a deal, they have an understanding of how this was going to go down. And they went into court with that understanding, and the judge said, well, wait a minute. You know, this looks to me a little more serious than you guys say it is.

HARLOW: Right.

GARBER: You got a senior national intelligence official, you know, who was lying, who was lying in the White House, who lied to the vice president, who was working at one point for a foreign power without disclosing it and you guys think he shouldn't get any jail time? This doesn't make sense to me, is what he is saying.

HARLOW: But --

GARBER: I've seen it before. I've been involved in situations like that before and it creates difficulty for both the defense and the prosecution.

HARLOW: But, Ross, to that point, and I know you have said you've had experienced it and witnessed it in a courtroom similar experiences to that, I mean, this judge got Flynn to admit in court that he lied, that he knew he was lying, that he was aware that it was wrong to lie and that he did not feel trapped or ambushed by the FBI. And still Judge Sullivan did not throw the book at him then and there. Why? Why wait?

GARBER: Well, this is a judge who is fair, who has a great reputation, and I think likes to protect the rights of defendants. He knew that Flynn came in with the expectation of not going to jail, and he wanted to be honest with Flynn and his lawyers, and say, hey, look, you know, based on what I have seen, I have concerns. I have concerns about acceptance of responsibility and contrition. And based on what I have seen, this seems like a jail deal. But, you know, if you have got more cooperation to do, you've got something else to say, you know, I'm going to give you some chance to do more cooperation, to say more of what you need to say to convince me that this isn't a jail deal. SCIUTTO: Lisa Lerer, of course an enormous political dimension to

this. It has been from the beginning. The president attacking the whole Russia investigation as a witch hunt and he himself has said repeatedly that Flynn was tricked. But we had one of those black is white, white is black moments, two plus two equal five yesterday when even after Flynn and his lawyers admitted repeatedly that they were not entrapped in no uncertain terms, Sara Sanders repeated from the White House podium the president's claim. Have a listen.


SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: The FBI broke standard protocol in the way that they came in and ambushed General Flynn and in the way that they questioned him and in the way that they encouraged him not to have White House Counsel's Office present.


SCIUTTO: That claim about the ambush is belied by the fact of the 302s, that were a record of those interviews. Why does the White House stick by that claim?

LISA LERER, CNN POLITICAL ANALYST: Well, it's also belied by common sense, right? This is Flynn -- he's someone who's a three-star general who headed up intelligence for the military. He is someone who knows that lying to the FBI is a crime. This shouldn't be a surprising situation for him when he finds himself in it.

But, look, the White House, as they have for months at this point, is fighting a political battle. In some ways politically their right to do so. Impeachment, if it gets to that point, is a political fight that happens in Congress and is determined by the votes of first the House and then the Senate.

So it's really important from the White House's point of view to undercut the Mueller investigation at every turn possible, to frame it as overreach, to frame it as the president likes to say, a witch hunt. So that's sort of been their talking points all along, and they are trying to stick with those talking points, particularly, I think it's worth remembering that Flynn himself has become a little bit of a folk hero among Trump's base. He was a big hit on the campaign trail. He was someone leading those chants of "lock her up" so this is someone who does have a following within Trump's orbit for sure.

HARLOW: Right.

LERER: And, you know, they're trying to make their political case regardless of what happens in court.

HARLOW: And that's why we saw these protesters outside of court, supporting Flynn yesterday as he was walking in.

LERER: Right.

HARLOW: That's a really good point, Lisa. Let me get you guys on this because it got a little bit buried in all

of the headlines of yesterday. But it is important. One of the number of entities related to the president under investigation right now was the Trump Foundation, the Trump charity, and they agreed yesterday to dissolve after this case brought against them by the New York attorney general. They're shutting down the charity. The attorney general called it, quote, "a little more than a checkbook to serve Mr. Trump's business and political interests."

Lisa, in the orbit of Trump-related scandals, where does this fall in importance?

LERER: Oh, I mean, look, is it more important than, you know, possibility the president siding with foreign entities to influence the election? I don't know. I think if you are one of the charities that was expecting a check from the foundation and didn't get it, it probably feels awfully important to you. But I think the important thing here is that this is one of 17 different active cases into the president and his businesses, and that number is not even counting congressional inquiries which of course are expected to increase the number in about two weeks when Democrats take control of the house.


So you know, this really shows us what an unprecedented moment we're in, where you have so many different cases probing into really every aspect of the president's financial orbit. You know, from his hotels to the inaugural committee, to the campaign to the White House.

So this really, the fact that this -- that this can -- this news can pass with, you know, as you point out, not really that big of a splash, really sort of highlights this amazing moment that the country finds itself --

HARLOW: Yes --


SCIUTTO: It's hard to keep up.

LERER: Yes --

HARLOW: It is hard to keep up, and look, the charity was accused of using this donation money to pay legal settlements to use art for the clubs, and also to make prohibitive political donations. So there is a lot of legal stuff here, too. Guys, thank you, Ross, nice to have you and Lisa, we appreciate it.

Shutdown to the wire is where we're at right now. The president signals he's backing off of his demand for immediate wall funding. Now, the race is on to put together a short-term Band-Aid.

Plus, waiting for the president to make good on his call for a middle class tax cut, don't hold your breath, we've got the latest --

SCIUTTO: And a new report as well, hackers target the European Union, intercepting thousands of messages, diplomatic cables. What EU diplomats really think about President Trump.


HARLOW: All right, we are just three days away from a potential partial government shutdown. Right now, Senate Republicans drafting a short-term bill that would keep the government open until early February. What is really unclear and really important is whether the president will sign it.

What is clear, his confidence that he will get this border wall. The president writes this morning, "when it comes to border security and the military, the Democrats fight to the death. One way or the other, we will win on the wall." He then wrote "the United States military will build the wall."

Joining me now is Democratic Congressman Mike Quigley of Illinois. No need to restate your position on the wall, we see it in your face there, we'll get to that in a moment. But I do want to get you on this breaking news, congressman, if I could.

Your reaction to President Trump's decision this morning that the United States will fully and rapidly withdraw U.S. troops from Syria. You've got about 2,000 U.S. boots on the ground there right now. Is that the right call?

REP. MIKE QUIGLEY (D), ILLINOIS: You know, I don't know enough about specifically and what they're talking about, having heard it just this morning as you have, obviously, we still have responsibilities there that matter, that affect national security, the ISIS threat in the region, I have no idea how they plan to do this in conjunction with their allies.

Those we're trying to help our relationship with all the other players on the battlefield in Syria. So I'd like to know more about how they plan to do this, and how they plan to fill the gaps and what our allies are going to do as well.

HARLOW: All right, are you concerned about the door that it opens here for Russia, for Iran in particular, for Turkey as well.

QUIGLEY: Oh, absolutely. This is a three-dimensional chess in Syria --

HARLOW: Yes --

QUIGLEY: And removing any one of the critical pieces including our involvement could be very dangerous. I just need to know a little more information about what their plans are --

HARLOW: Right --

QUIGLEY: And if they have contingencies or understandings with those that we're allied with in the region. What if anything was said with the Russians and the Syrian government here. Obviously --

HARLOW: Yes -- QUIGLEY: We've gone from one extreme to another, where we're talking

about regime change and now we're talking about leaving the battlefield.

HARLOW: Fair enough, so let's move on to other topics. Senate Majority leader Mitch McConnell says he is quote, "sure, that a shutdown will be avoided." You were quoted just few weeks ago as saying "I have a liberal bent, but I still want to get things done."

Where are you willing to give on this? Does the president insist again a border wall will be built as a Democratic congressman? How much are you willing to give toward that effort?

QUIGLEY: I think that the Democrats gave in 2018, there was over a billion dollars in funding for border security. And I've been to the south and at the border, and it's very clear that a border wall doesn't work, it's an extraordinarily expensive boondoggle, but we should be concerned about border security. But they haven't spent all the money from 2018 on those measures.

HARLOW: Right.

QUIGLEY: I do believe Democrats believe in border security, but the wall isn't the measure that gets that done, $5 billion --

HARLOW: Well --

QUIGLEY: Doesn't make sense when there is so many other needs.

HARLOW: Understood, Democratic -- we had a Democratic congresswoman on last week, Jackie Speier who also doesn't love the wall idea. But she said, look, I think we meet in the middle. I'm willing to give $2.5 billion towards this if we get some DACA relief.

If you're going to truly work together, the president wants $5 billion for the border wall, you've got 81 percent of Republicans in the new Cnn poll that support a wall, only 7 percent of Democrats, I get that. But you represent more than just Democrats, right?

You represent your constituents. Are those 81 percent wrong or should Democrats give a little more on this?

QUIGLEY: I think when we talk about policy, we ask, what is our ultimate goal? And it's clear the ultimate goal here is border security. And that must be coupled with comprehensive immigration reform, which we strongly support. So I believe you can accomplish the goal of border security.

[09:25:00] It's the means in which we do it. Again, it makes absolutely no sense to build a wall, which is limited in its effectiveness. Border security chiefs from Reagan on have said that a wall will deter someone trying to cross the border somewhere between 90 seconds and three minutes.

There are other methods that are more effective and more cost effective, and that's what we should be looking at. HARLOW: I'm sorry --

QUIGLEY: In the end, I believe there's bipartisan, bicameral support to accomplish it through that means.

HARLOW: This is an area where there's a lot of division, but let's take a moment to end this on an area where members of Congress came together late last night, and that is what the Senate did on this criminal justice reform legislation. A vote in favor of it passing the Senate overwhelmingly bipartisan manner, 87 to 12.

Now, you do have some senators like Tom Cotton who say a number of serious felons including violent crimes are still eligible for early release. He says it flunks the basic test to protect public safety. What say you, does it have your support when it makes it to the House this week?

QUIGLEY: It does. I practiced criminal defense for ten years, and I watched the futile effort of trying to lock up drug offenders for the rest of their lives or long periods of time. It's extraordinary cost when rehabilitation makes more sense, deterrence makes a lot more sense.

I am concerned about violent crime, and I believe those who commit violent crimes need to serve their sentences. But I do believe this is a bipartisan effort to try to meet in the middle. We have a serious drug problem in this country, we need to address it at its core.

It makes no sense to be one of the democratic countries in the world that locks people up for -- and some of the greatest numbers. So I do believe Congress has shown some efforts in a very few areas. We just passed a farm bill, I'd like to think we can get this done as well to work on a bipartisan basis in time for Christmas.

HARLOW: And the credit to it goes to, in your mind? It's President Trump, Jared Kushner who is the big one who pushed for this? Do they get credit on this?

QUIGLEY: Look, I want to give everybody -- victory has a whole lot of parents.

HARLOW: Yes --

QUIGLEY: Defeat is an orphan. I will give everybody credit if we get something done in a positive way. There's no read to -- no reason to bicker when we're trying to get something done in an effective way.

HARLOW: Congressman Quigley, thank you very much and Merry Christmas.

QUIGLEY: Thank you, Merry --

SCIUTTO: A moment of bipartisanship --

HARLOW: There you go -- SCIUTTO: Still ahead, former Attorney General Loretta Lynch set to

arrive on Capitol Hill at any moment to face off with House Republicans. We're going to be live from there. And we're just minutes away from the opening bell on Wall Street, futures are pointing higher this morning.

This as the Federal Reserve is expected to hike interest rates for the fourth time this year.