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ERIN BURNETT OUTFRONT

Hours Away From A Government Shutdown As Trump Is Now Touting A Beautiful Steel Slat Barrier With Spikes; Source: Trump "Hates" Mattis' Resignation Letter; Trump Vented at Whitaker After Explosive Cohen Revelations; Interview with Rep. Sheila Jackson Lee. Aired 7-8pm ET

Aired December 21, 2018 - 19:00   ET

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


[19:00:00] WOLF BLITZER, CNN ANCHOR: "ERIN BURNETT OUTFRONT" starts right now.

ERIN BURNETT, OUTFRONT HOST: Out front next, breaking news, a government shutdown hours away. The big question for the President tonight, apparently is when his wall is no longer a wall. Now apparently it's a steel slat barrier and it's a different thing.

Plus breaking news, new details on Trump angry at his Acting Attorney General. Why? We have the breaking news ahead.

And the President just naming a new Acting Chief of Staff. Wait until he hears what Mick Mulvaney said about his wall or his steel slat barrier. It's not nice. Let's go out front.

Good evening, I'm Erin Burnett. Out front tonight, the breaking news. Hours away from shutdown, the outcome is hanging on the wall. President Trump moments ago trying to get his wall by, wow, calling it something else. Here's the tweet. "A design of our steel slat barrier, which is totally effective while at the same time beautiful."

Obviously look at that, Trump's image zooming in on those razor sharp spikes, effective because they impale? Beautiful because -- well. It could be lethal. But it's not a wall. That's a crucial thing, right? It's a steel slat barrier, capital S, capital S, capital B and the President seriously thinks that Democrats are dumb enough or desperate enough to vote for a steel slat barrier when they will not vote for a wall.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: There's a debate over funding border security and the wall, also called so that I give them a little bit of an out, steel slats. We don't use the word wall necessarily. But it has to be something special to do the job. Steel slats. I've made my position very clear. Any measure that funds the government must include border security. Has to.

(END VIDEO CLIP)

BURNETT: Just worth reminding you yet again, you know, because this is not a skit in a late-night comedy show, tonight the President after giving Democrats a steel slat barrier -- wall -- to vote on, says it's all their fault if the government shuts down over this.

(BEGIN VIDEO CLIP)

TRUMP: There's a very good chance it won't get passed. It's up to the Democrats. So it's really the Democrat shutdown.

(END VIDEO CLIP)

BURNETT: It's amazing how he has no problem saying the complete opposite of something he said just days ago. Because here he is, just one week ago about a shutdown over the wall.

(BEGIN VIDEO CLIP)

CHUCK SCHUMER (D), SENATE MINORITY LEADER: Twenty times you have called for, I will shut down the government if I don't get my wall. None of us have said --

TRUMP: You want to know something?

UNIDENTIFIED MALE: -- you've said.

TRUMP: OK, you want to put that on my --

SCHUMER: You've said.

TRUMP: I'll take it.

SCHUMER: OK, good.

TRUMP: You know what I'll say? Yes. If we don't get what we want one way or the other, whether it's through you, through a military, through anything you want to call, I will shut down the government.

SCHUMER: OK. Fair enough, we disagree. We disagree.

TRUMP: And I'll tell you what. I am proud to shut down the government for border security, Chuck. I will take the mantle. I will be the one to shut it down. I'm not going to blame you for it.

(END VIDEO CLIP)

BURNETT: OK. Obviously, didn't keep his word on that particular point. Let's make no mistake. The President is pushing for a wall that neither Democrats or enough Republicans want to give him. This isn't just a Democrat versus Republican thing. There's a lot of Republicans who think this wall is a terrible idea. It is the President's wall, it is his set of steel slat barriers and his shutdown.

Kaitlan Collins is out front at the White House. And Kaitlan, the President says that this could be a shut down, in face, a long shut down in his words.

KAITLAN COLLINS, CNN WHITE HOUSE CORRESPONDENT: Yes. But that seems to have changed a little bit here at the White House. That attitude that we just saw from the President not that long ago because he has since set his Vice President, his incoming chief of staff and his son- in-law and Senior Adviser Jared Kushner up to Capitol Hill where they are shuffling between House Speaker Paul Ryan's office, Senate Minority Leader Chuck Schumer's office, going all over the Hill as now that a possibility of a compromise is back on the table since we saw Bob Corker vote yes and Jeff Flake change his vote and Mike Pence break that tie to where they did vote for that motion to proceed.

Now, the question is how long is it going to take them to find a compromise like that. And the people I've spoken to here in the White House and that our Hill colleagues have spoken to as well over there down the street say they do not believe one is coming before midnight. That means we are getting a partial government shutdown. It is increasingly likely of that is going to happen.

Now what they want to do moving forward is try to blunt how long that shutdown is going to be going on. They want to come to a decision quickly. They hoped that these negotiations are going to move pretty quickly but as you heard from McConnell and Senator Flake, they do not want to bring a vote to the floor until they know it's going to pass. Obviously, it's not going to be that $5 billion in the border that the House passed, so expect to see something different.

Now while they're still up on Capitol Hill, Mike Pence, Jared Kushner, Mick Mulvaney, President Trump is back here at the White House tweeting out just a short while ago saying that he's canceled his flight to Palm Beach which he was expected to go to over the next two and a half weeks or so.

[19:05:09] And instead he's sitting there in the Oval Office saying he canceled his trip waiting to see if Democrats will help us protect America's southern border. So Erin, while the President's aides are up on Capitol Hill trying to work not only with Republicans but also Democrats to keep the government funded, hopefully make that shutdown as short as possible, the President is still trying to put this messaging back on Democrats.

One thing I'm going to point out, we could have avoided all of these, all of these people could be at home right now if this happened a few days ago. There's nothing that's changed in recent days that couldn't have prevented this from happening a few days ago. Now we're just going to see how long the shutdown is going to last.

BURNETT: All right, Kaitlan, thank you.

Out front tonight, Democratic Senator Mark Warner, a member of the Finance Committee. And Senator, Bob Corker just telling CNN some people are, quote, optimistic. Something happens tonight. John Cornyn saying there's not going to be a vote tonight, you could take it to the bank, that's his quote. What do you think?

SEN. MARK WARNER (D), INTELLIGENCE COMMITTEE VICE CHAIRMAN: I don't have the foggiest idea. The last 12 hours have been one of the reasons why so many Americans think Washington has gotten pretty crazy. The idea that people were flipping their votes so they could say that now there's a deal to try to get a deal, why that couldn't have happened 12 hours ago is frankly beyond me.

But, you know, let's remember how we got here. We got here with Donald Trump a week ago claiming that he would be proud to own a government shutdown which frankly is insulting to the thousands of federal employees in my state or the -- I'm sure the thousands of Americans who maybe thought that over the holidays they'd visit a national park, where he was proud to claim that. And then I think some of the more reasonable people in the White House convinced him that there were not votes for his wall.

And then what was amazing at -- what happened this week, I even feel some empathy for the Vice President because the Vice President had to come up and tell the Republican Caucus that, yes, the short term continuing resolution, vote for it, the President will sign it, everything is kosher. And that then passed unanimously until then Trump as usual reneged and the Vice President had to come back up and say the deal that had been made the night before was no longer valid. So --

BURNETT: So, you don't even know whether -- you're not even going to -- you don't even know whether we're closing the government down in a few hours?

WARNER: You know, as someone who, you know, is on Finance Committee, you know, Vice Chair of the Intelligence Committee I would even think my intel contacts don't have the foggiest idea of what's going to happen. I just think, you know, this President is unwilling to accept any reality that doesn't match his reality.

My understanding that the meeting with the Republicans at the White House today was so chaotic because he kept trying to convince the Republicans to change the Senate rules, something that they had made clear they weren't prepared to do. So, this governing by chaos theory, whether it is his lack of sophisticated approach on national security that led to the resignation of Jim Mattis or the notion of what actually he would accept, is a constantly moving target. And I think just like most Americans who are pretty frustrated, most senators frankly in both parties because for the most part this has not been a partisan split. Again, I remind the viewers that it was this continuing resolution passed unanimously because the Republicans realized that this fight would be better held in January than during the holidays.

BURNETT: And, of course, I want to be clear, you know, the Republican Congress people along the border, right, they don't support a wall, right. So even on the issues of a wall, there's a quite a bit of bipartisan agreement on Capitol Hill.

I want to read again to you, though, Senator Warner, the President's tweet from moments ago. He writes, "A design of our steel slat barrier which is totally effective while at the same time beautiful", tweeting out a picture of what I guess he would put up, and has a zoom in there, you know, of those three spikes. What's your reaction?

WARNER: Well, I saw the picture and, you know, if this wasn't the President of the United States, if the stakes weren't so high, if this man had any kind of willingness to stick to his word, you know, it would almost be comical. The fact is, you know, I think you could find the vast majority of Democrats who were willing to increase border security, but let's use 21st century technology, drones, electronic surveillance, additional border guards.

[19:10:12] Not 14th century technology, a wall, whether he calls it steel plated or not which I've not heard a single security expert said would actually, you know, increase border security. And, you know, we've heard earlier today that these were the views that the President's current acting Chief of Staff Mick Mulvaney had as well a few years back saying the wall was an absurd idea.

BURNETT: He did that. And, you know, look, when you talk about the 14th century technology, the President has been seizing on that, right? Not just pointing out those impaling-like spikes but, you know, this --

WARNER: I think there was impaling-like spikes used in castles during the crusades as well so I'm not sure that is a 21st century development.

BURNETT: No, it certainly isn't and steel slat barrier, perhaps, may be his own term. He is actually though saying, Senator, this gives you an out. Here he is again.

(BEGIN VIDEO CLIP)

TRUMP: There's a debate over funding border security and the wall, also called, so that I give them a little bit of an out, steel slats. We don't use the word wall necessarily. But it has to be something special to do the job, steel slat slats. I've made my position very clear. Any measure that funds the government must include border security. Has to.

(END VIDEO CLIP)

BURNETT: So what did he say, he says it's not a wall, Senator Warner, it's a steel slat. That's an out, right? I mean, you know, that's your out?

WARNER: I would say this is a guy whose willingness to stick to the facts has been in question since his first day in office. And I think, again, all of the Republican colleagues and friends at least privately are as frustrated as I am and probably the folks who are following this story because this is a crisis that was totally created by Donald Trump. People should not happen to go through this kind of trepidation in terms of federal employees.

And, you know, the Senate leadership, the Republican House leadership told him a week ago that there were not the votes for this proposal. And that's why, you know, it was may be wishful thinking when we passed the unanimously a resolution of this issue that at least for a few hours the President had agreed to, that was at least until some of the -- referring these voices on the right starting to criticize him.

BURNETT: All right. Senator Warner, I appreciate your time. Thank you very much. As the minutes click away here closer and closer to midnight.

WARNER: Thanks, Erin.

BURNETT: And next, Trump angry over the Mattis resignation letter. We saw that coming but now more angry. People are calling Mattis, quote, the adult in the room.

And breaking news, Trump's ripping into his Acting Attorney General. Big development tonight, that ahead.

Plus, is Trump's newly named Acting Chief of Staff Mick Mulvaney in trouble before he officially starts his job? You heard Senator Warner refer to this? This audio unearthed by CNN's KFile.

(BEGIN VIDEO CLIP)

MICK MULVANEY, ACTING CHIEF OF STAFF: But to just say build the darn fence and have that be the end of an immigration discussion is absurd and almost childish for someone running for president to take that simplistic a view.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

[19:17:14] BURNETT: Tonight, angry. President Trump angry about Defense Secretary James Mattis' scathing resignation letter. A source close to the White House telling CNN tonight that Trump, quote, hates the letter but hates the coverage more. What is driving his fury in particular is the often-repeated line that's been out there that Mattis was, quote, you know, one of the adults in the room which was, indeed, the widespread perception of Jim Mattis. And this comes as we are now learning more details, new detail this hour about Mattis' resignation.

Barbara Starr joins me from the Pentagon. And Barbara, what are you learning?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, good evening, Erin. You know, the reaction of Jim Mattis resigning, saying he could no longer work for President Trump, has been met with a good deal of dismay and uncertainty across the ranks. I think it's very fair to say. And that uncertain is something that has commanders not very happy at the moment because the military doesn't like uncertainty. It likes to know exactly what is happening.

So the hunt is on for a new Secretary of Defense that the President has promised. And people will be looking to that person to bring some stability to the situation. But there's another narrative underneath all of this that is beginning to emerge, at least in some quarters and that is could Mattis have timed his decision differently? Would it have been better for everyone, including him, if he had left earlier?

He knew that his relationship with the President was headed downhill. He knew the President wanted to bring troops out of Syria. And the big issue right now, the red line for Mattis has been bringing the troops out of Syria leaves the Kurds that the U.S. supported there abandoned and exposed to a so-called bloodbath. If Mattis had left earlier, Trump could have brought in another Secretary of Defense, someone who may have had more influence over him and maybe just maybe could have convinced him to keep troops a while longer at least in Syria.

Of course, we never going to know the real answer to this question but it's the kind of thing that you're beginning to hear people talk about and people are expressing still and awful lot of regret that Mattis is leaving but the military is a resilient organization. They will move on, there will be a new Secretary of Defense. But this is going to stick in their minds for quite a while. Erin?

BURNETT: All right, Barbara, thank you very much. And perhaps a bit of wishful thinking by people, right, by the time, you know, someone leaves and you get someone new and you have them confirmed and you get them through. We really think a Syria troop decision was going to wait for all of that.

Out front now, Retired U.S. Army Major General James "Spider" Marks, Senior National Security Correspondent with The Daily Beast, Kimberly Dozier, and Tim Naftali, Former Director of the Nixon Presidential Library here with me. Tim, so, look, you know, everyone is now sick in guessing. You have people who are upset, he's leaving all together because he was the adult in the room and now you have people upset he's leaving because he should have left earlier when you could have replaced him with somebody else.

[19:20:05] TIM NAFTALI, FORMER DIRECTOR, NIXON PRESIDENTIAL LIBRARY: Well, and people made to be upset I think because we are superpower without a strategy. What's clear from all the reporting is that Mattis left because the President was impulsive about dealing with Syria and Afghanistan which means we have a commander-in-chief who doesn't have a strategy. Yes, America first. It means defending our interest but we always defend our interest.

Mattis' letter made it clear to all of us that there is no security strategy of the United States. And with Mattis gone, I asked what's Pompeo up to? Who is actually making foreign policy for this government?

BURNETT: General Marks?

MAJ. JAMES "SPIDER" MARKS, U.S. ARMY (RET.): Yes, I agree with Tim that when you lose someone like Jim Mattis, you lose an incredibly mature, very seasoned leader who not only understands the nature of warfare but also understands the nature of management and leadership at the very largest levels. I mean, he's running this large organization. And I think it's a very honorable thing.

In fact, what Jim did is -- I think we're putting probably too much weight on the fact that the Syria decision might have been the trigger event that caused him to depart and it might have really been the aggregate weight of two years of engaging with the President with a lot of body blows and being the individual in the room that was pushing back and providing some counsel, not necessarily getting in the formation which ostensibly the President would have preferred. And so Jim raised his hand and said Mr. President, thank you for this opportunity but I can't be the guy to implement what you're trying to implement.

BURNETT: And yet, Kim, you know, allies of this country and the Middle East and elsewhere, you know, would tell all of us, you know what? We've known Jim Mattis for a long time, we know and we trust him, we have meetings with him, as long as he's there it's OK. And they would often actually contrast that with Rex Tillerson who they liked but viewed as impotent relatively when it came to policy, right?

Jim Mattis had the goods. You now have been talking to so many of these people and they are shaken and concerned about chaos, right?

KIMBERLY DOZIER, SENIOR NATIONAL SECURITY CORRESPODENT, THE DAILY BEAST: Absolutely. From NATO allies to Mid East allies to neighbors of Syria caught flat footed by this and then compounding that is when they reached out to the people they could normally trust in the Pentagon, the State Department and intelligence agencies and said what is happening, what next? And they were told, well, we don't know, that's when the alarm really spread. So I've spoken to multiple diplomats who are concerned and watching closely to see who replaces Mattis.

Now, one of the other things that I'm hearing confirming some other reporting out there by the Associated Press is that this phone call that the President had with the Turkish President, that that was the pivotal moment that no one could anticipate. Yes, there had been friction with Mattis but that Mattis was prepared to stay until the end of this administration and that it didn't feel like to him that this was any worse right now than it had been at other contentious points in the past.

BURNETT: You know, Tim, the thing is here is when you take this, Jim Mattis leaving, right? The chaos that that -- that the perception of chaos and the reality of chaps that that causes, the shutdown, now we are almost four hours away from a government shutdown in this country, borrowing some kind of a miracle. The Dow just had its worst week since 2008. I was sitting on wall street when that happened. That was essentially a great depression.

The Mueller probe is continuing. We now have what? More than a dozen investigations into Donald Trump's personal and presidential life. This is a whole new level of chaos or would you say no?

NAFTALI: No. I would say it's a new level of chaos. And I would say this is -- this shows that the containment of Donald Trump has failed. One of the things that we notice was that even though Donald Trump was saying -- was using tweets to cause disruption with their allies, on a day to day basis, the U.S. military was doing the job that they had been doing since the end of the Cold War.

BURNETT: Right.

NAFTALI: Now with Mattis gone, we don't know if some kind of Trump disruptor is going to become Secretary of Defense. So, the disruption that we now see in the White House will spread throughout our national security structure. That will be dangerous. It will be dangerous not just for our security but the security of our allies.

BURNETT: I mean, how dangerous is it, General Marks? You know, you have people -- Democrats and Republicans, right, saying Republicans, I want to emphasize that this was not a partisan reaction to Jim Mattis saying American lives are going to be lost because of the policy changes that the President is forcing through. You now have the bulwark, I guess, if that's the word that you want to use for Defense Secretary Mattis, it's gone, it's just gone, poof.

MARKS: Yes. He was the individual in the room that was providing what I would call the contrarian view, the notion of the 10th man where nine folks all agree, they get on the bus together and the 10th person raises a hand and says, wait a minute, let's consider these things. I'm not certain who's going to do that. I'm saying there will be somebody who can replace Jim Mattis and come in and that the mechanism of running this thing called the Defense Department and what the soldiers do on the ground, the soldiers, sailors, airmen, marines as a matter of routine will continue apace and will be done magnificently at the top there is chaos.

[19:25:16] But bear in mind, we still have this large mechanism where entry points and contacts still exist and those mature relationships now were going to start to light up much more as we try to fill in the gaps, because we simply don't know who's going to replace him. But we have to be optimistic that it will be a mature individual in the room.

BURNETT: All right. Well let me ask (INAUDIBLE) about a mature individual in room, right? obviously, the contrast here, the point that everyone is making, right, Jim Mattis is a mature individual in the room. And there weren't always a whole lot of them. And now the question is, can the President find someone who is qualified, who is that mature person and aligned with him? Meaning pulling all the troops out of Syria and having a rapid partial withdrawal from Afghanistan. I haven't -- Those thing two things seem to be diametrically opposed to each other.

DOZIER: Well, there have been a number of names like Senator Tom Cotton, Jim Talent was one of the people on the list before Mattis was appointed. So there are some people who are being considered but the problem is do you want this two year poison chalice where you will have to wear the drawdown of U.S. troops in two theaters. And in one case a really precipitous drawdown.

BURNETT: But he's made it clear that he thinks the Syria thing was a terrible idea, right? I mean, so maybe he'll go ahead with it and do a complete flip-flop, right? But when you talk about qualified in the line, even some of these folks you're talking about don't fit.

DOZIER: Exactly. I mean, Lindsey Graham, Mac Thornberry, all the names that you've heard, except for Jim Talent, which is one of the reasons some people are telling me maybe he'll be one of the people willing to accept this mission. In the meantime, what the Pentagon is trying to do is still salvage at least the air war over Syria to support some of their coalition partners. They hope we'll backfall U.S. troops on the ground.

And they're also trying to figure out a reasonable pace for withdrawal in Afghanistan so they don't do what they've done -- what they feel the President has done in Syria which one Syrian administration official told me was like a knee jerk reaction that has left their Kurdish allies in the lurch and will be a message to everyone else who works with the U.S. in the future.

BURNETT: Certainly will. Thank you all very much.

And next, breaking news. Trump angry with his Acting Attorney General. Why? New breaking details ahead.

And as Trump demands money for a border wall, his next chief of staff wants, well, repeatedly trashed that wall. Listen.

(BEGIN VIDEO CLIP)

MULVANEY: It's an easy thing for someone who doesn't follow the issue very closely to say, oh, that'll just solve everything, build a fence.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

[19:30:56] ERIN BURNETT, CNN HOST: Breaking news: we are learning tonight that President Trump has more than once lashed out at Acting Attorney General Matt Whitaker. Trump was upset with Whitaker because prosecutors he oversees implicated the president in their Michael Cohen investigations.

All right. Let's get to the bottom of exactly what this means. I want to go to Pamela Brown and Laura Jarrett who are breaking the story.

Pamela, let me start with you. What can you tell us?

PAMELA BROWN, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, Erin, on at least two occasions on the past few weeks, we have learned that the president vented at his Acting Attorney General Matt Whitaker about the Michael Cohen investigations. The president angered by federal prosecutors referencing him in crimes that Michael Cohen pleaded guilty to. And according to multiple sources, Erin, Trump was frustrated that prosecutors that Whitaker oversees filed charges that made him look bad.

Now, we should note that none of the sources suggest that the president directed Whitaker to stop the investigators, but these discussion between Trump and Whitaker underscore the extent that the president believes his attorney general should serve as his personal protector and it also gives a glimpse into the strange dynamic, Erin, of a sitting president talking to his attorney general directly about investigations he's potentially implicated in.

BURNETT: Yes, which is hugely significant. OK. Laura, tell me more about the instance here, the specific

instances, because what happened and the timing of what happened is so important here. The president lashes out at Whitaker, two instances, tell us more.

LAURA JARRETT, CNN JUSTICE CORRESPONDENT: That's right, Erin. So there's at least two discussions that we know about. So, the first took place a few weeks after Whitaker took for his former boss Jeff Sessions, and Trump was angry after special counsel Robert Mueller charged Michael Cohen with making false statements about the Trump Tower Project in Moscow. We all remember that in late November.

And you recall, part of the prosecution description at the time was that Cohen talked with the president about the project well into the election season, contrary to his congressional testimony. Then over a week later, federal prosecutors in Manhattan implicated the president in campaign finance charges officially in those charges that were brought against Cohen, describing how the president directed Cohen to make the payments in that sentencing. It was pretty explosive.

Now, Trump and his attorneys maintain these payments are not illegal. Of course, other experts fiercely disagree and we should add that while not confirming any of these conversations with the president, his lawyer, Rudy Giuliani, said in a statement to us that the president and his lawyers are upset about the professional prosecutors in the Southern District of New York going after a non-crime and the innuendo the president was involved.

The Justice Department, Erin, declined to comment for the story.

BURNETT: All right. So, you know, Pamela, on some level, I guess it feels like this could be Jeff Sessions all over again.

BROWN: Right. I mean, that's a good point, Erin. It certainly does. The president as you noted has on numerous occasions gone after Sessions, publicly and privately for recusing himself and not controlling the special counsel probe. And Whitaker, he had an acting attorney general who had publicly criticized the probe, the Russia probe and TV appearances.

And just this week, Whitaker refused to recuse himself from overseeing the Russia probe. He rejected an ethics adviser review that said he would not be perceived as impartial because of his public comments and then we learned this week that the president's nominee to replace Sessions, William Barr, had sent a memo to justice in June laying out why the special counsel should not investigate the president for obstruction. We learned this week that Barr discussed the memo with the president and mentioned it would come up during the Senate confirmation hearing.

BURNETT: So, Laura, what has Whitaker's role been in connection with these investigations? That's obviously going to be very crucial here for the president and for the country, for the citizens.

JARRETT: Absolutely. That's been the question all along since he came into office in November. It's also been an issue of what exactly he's given up to vis-a-vis the Mueller investigation. And until this week, Whitaker had actually not been briefed about the investigation, sources tell us. But he was given the heads up about the fact that the Cohen plea was coming in late November.

[19:35:04] And we learned this week that Whitaker will soon get a briefing now that he's done that ethics review, as Pamela mentioned, and he's decided for himself not to step aside from the investigation. Of course, the deputy attorney general's office, Rod Rosenstein, still manages it day to day, but those two could clash because Whitaker is now in the driver's seat. And so, if they disagree with him on anything, Whitaker would overrule him.

BURNETT: All right. Thank you both very much with this new development, significant development here on the acting attorney general.

Harry Sandick is with me, former U.S. attorney for the Southern District, April Ryan, White House correspondent for American Urban Radio Networks also with me.

So, Harry, let me start. OK. Obviously, the timeline will be crucial and I want to get to that in a moment because the president's mad about certain things Whitaker does and then Whitaker does something the president wants him to do very much. So let's start here with this reporting from Pamela and Laura on how angry the president is at Whitaker over campaign finance and the Trump Tower Moscow.

How significant is it?

HARRY SANDICK, FORMER ASSISTANT U.S. ATTORNEY, SOUTHERN DISTRICT OF NEW YORK: I think very significant. I think it's significant because these continued discussions with the people who are supervising the investigation, he doesn't have to come out and say, you know, keep me out of the investigation. The anger that he shows afterwards reflects what his intent was and what his intent is going forward, which is to influence the investigation. But as we've seen, number one, Whitaker was sort of holding off pending the ethics review, which he's now come out the opposite way from Sessions and decided to not recuse from the investigation and what we've also seen is that career prosecutors in the southern district are going to do their job without fear of favor. They're not going to do something in hopes of satisfying the president or the acting attorney general.

BURNETT: So, April what do you make of this? The two instances that Laura and Pam just walked through, right, the president being implicated in the Trump Tower project in Moscow, and the hush money payments to the mistresses in the final days before the election.

So, what does this mean that the president is weighing in on these things?

APRIL RYAN, WHITE HOUE CORRESPONDENT, AMERICAN URBAN RADIO NETWORKS: The president is very upset. Of late, when is the president not upset? But you've got to remember, one of the reasons why he is upset is because he distanced himself from this. He looks bad. You know, we keep going back to the audio and video of when the

president was on Air Force One saying he had nothing to do with those payments and then we now have these tapes for Michael Cohen that we've heard some tapes and if we've heard just very little, imagine what they have within the investigation. And you have to remember this, Michael Cohen, even though the president tries to dismiss and diminish his relationship to him, Michael Cohen was very critical to this president for a number of years. He understood about -- he knows what's going on with the foundation, the alleged illegal activities with the foundation, with the Trump Foundation. He also knows the Trump Tower Russia meetings.

And, you know, Michael Cohen -- and people forget, Michael Cohen also brought to the president very key people that the president really relied on. Some people maybe be unscrupulous, some people maybe professional but he also -- Michael Cohen was also the person who brought a lot of the black thinkers or leaders that the president would like to call to him. So, this president doesn't like it, but there are too many tentacles that intertwined both of them and he may be upset, but he's upset because it's being revealed.

BURNETT: And, Harry, to this point, though, now, let's enter the timeline.

SANDICK: Yes.

BURNETT: Whitaker does these things regarding campaign finance, Michael Cohen, Trump Tower, Michael Cohen. The president's upset, expresses that frustration. Then ethics adviser review says, you know what, Whitaker, you made negative comments about this probe, you should recuse yourself. Whitaker doesn't.

Is he doing it to make up to the president to say look, don't worry, I'm still OK? When you put the timeline together and his willingness to overrule the ethics panel, what do you think?

SANDICK: I think number one, he's absolutely trying to curry favor with the president. The president was angry when Sessions recused himself and he's not going to make that mistake. Number two, from the timeline that's been laid out tonight, it certainly seems as if it's in response to the president's expression of anger that now that he's cleared by the ethics review or sort of cleared, he actually cleared himself, I believe, the ethics opinion was.

BURNETT: And he overruled -- he overruled the review which was you should recuse.

SANDICK: Exactly. So he's going to wade into this and we may well see him try to prove his worth to the president in ways that he didn't before.

BURNETT: I mean, April, this is also -- this is the acting attorney general, right?

RYAN: Right.

BURNETT: Now, we've got Trump's pick to formally take over the job, right?

[19:40:01] We now know that he wrote in a memo to justice officials earlier this year that Mueller's inquiry was fatally misconceived, referring specifically the obstruction aspect of it. This is pretty clear that he also agrees with the president, right? I mean, it's pretty -- is the president clearly trying to stack the Justice Department with people who will go there and just fix this probe for him?

RYAN: Well, you know the president would say he will never try to stack the Justice Department but it sounds like loyalty. You know, if it looks like a duck, sounds like a duck and quacks like a duck, it's a duck, you know?

But what I'm hearing from sources close to this White House, Republican sources are telling me the president is still mad right now because all of this with Barr and Whitaker is getting too much attention. And I hear that the president is very upset mostly right now because Whitaker, all this recusal stuff, to recuse or not recuse, and he's not recusing himself. And with Barr, we'll see how this plays out.

The president wants someone who can change the dynamic of the forward- moving train called the Mueller investigation and will Barr or Whitaker be able to do it? I don't think so. It's gone too far.

BURNETT: Yes. Now because anything they do would be perceived as biased around being done because they're behold on the president.

Thank you both very much.

And next, the House just adjourned for the night. Whoa. Does that mean it's done here? We're getting a shutdown? We're going to go back to Capitol Hill. As I said, we're now four hours away from a formal shutdown.

And Mick Mulvaney, you know, now supposedly acting as the chief of staff, favorite of the president. Oh, bad timing, Mick. Here you are talking about a wall.

(BEGIN AUDIO CLIP)

MICK MULVANEY, OMB DIRECTOR: The bottom line is the fence doesn't stop anybody who wants to get across. You go under. You go around. You go through it.

(END AUDIO CLIP)

(COMMERCIAL BREAK)

BURNETT: I want to go back to the breaking news on Capitol Hill. A shutdown now essentially guaranteed at midnight tonight. The House is adjourned. President Trump does not have the $5 billion he insisted he must in border wall funding to keep the government open.

[19:45:02] Just to note, this will be the first time in more than 40 years that the government shuts down three times in one year.

Manu Raju is OUTFRONT on the Hill.

And, Manu, you know, look, I always like to say to people, you know, they say, well, it's non-essential and they get paid back at the end and that may be true. But the fact that you have to greatest democracy in the world and you can't keep the government open and figure out how to make it work is unacceptable, and that is what is so offensive here. In just about four hours, it's going to happen all over again, all the dysfunction out there for the world to see, government shutting down.

MANU RAJU, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Yes, that's right, and frustration in the Capitol all day long over this very topic, even the one Republican Senator Lisa Murkowski vented her frustration at the president and failure to get a deal with all the Republican control of Congress and with the president changing his mind in what has prompted so much concern among Republicans all they long is they have not been clear about what the president would sign beyond the $5 billion number for wall funding that has no chance of passing the United States Senate.

He had a meeting with Republicans earlier today. He would not be clear about his end game was and Republicans in a private lunch I'm told vented their frustration in the fact that they don't know what the president would ultimately sign.

Now, the House just adjourned for the night. And Senator John Cornyn told me that the Senate would not have any votes for the night, so that means it's essentially assured that the partial government shutdown will occur at midnight, the third of the Trump presidency.

Now, talks are still ongoing, Erin. Vice President Mike Pence is in the Senate still having discussions with Senate Minority Leader Chuck Schumer, as well as with House Minority Leader Nancy Pelosi. But the Republican leaders, Mitch McConnell in the Senate, Paul Ryan, the speaker, both have left for the night. Meaning it's really up to Mike Pence, the White House, Schumer and Pelosi to cut a deal.

And if Pence cuts a deal with them, the ultimate question is will Trump go along with it, Erin? Because that's a big question has been looming all night, they thought he would agree to a short term deal to keep the government open until February 8th, well it turned out he didn't do that -- Erin.

BURNETT: All right. Manu, thank you very much.

That, of course, is the thing, right? The vice president goes, puts his reputation on the line and then everyone agrees, and then he goes back and the president changes his mind. So it's tough when your own vice president can't even credibly fully speak for you.

OUTFRONT now, Democratic Congresswoman from Texas, Sheila Jackson Lee, who sits on the House Judiciary Committee.

Congresswoman, the president has tweeted: The Democrats now own the shutdown. Democrats in the Senate and the House, of course, voted against the spending plan. Yes, sure, the president said he owned it, he's happy to own it, he said all that to Chuck Schumer about a week ago, but are you concerned that his message now will resonate with the public and the blame could shift?

REP. SHEILA JACKSON LEE (D), TEXAS: Now, let me speak to the American people, Erin. Thank you for having me this evening.

I don't think their memory as short as the president's memory. First of all, moving past last week -- and you're absolutely right, glaringly in the Oval Office, loudly in the Oval Office, shouting in the Oval Office, the president said I'll take charge of this shutdown. I'll take ownership of this shutdown.

How many times did he say it? He said to Chuck Schumer, don't worry about it, Chuck, I won't blame it on you. But more importantly, last 24 to 36 hours, the United States Senate voted bipartisan, in a bipartisan manner, unanimously, to send over an agreement of a CR, that had been agreed to by the House of Representatives that the president had agreed to sign. Does he not remember that? That would have protected 800,000 federal employees.

I'm sick of this mess at his feet. And what happened? Fox News began to run the presidency all day long, pounding him. I understand he called one of the Fox News anchors or Rush Limbaugh to let him know I've stood up to them.

That is ridiculous. That's not the way you run a country. So it is a mess.

BURNETT: So, you know, I want to put up the tweet. You've seen it. I want to show it to our viewers again. Those steel slats when the president is saying a design of a steel slat barrier, which, of course, is his new word for the wall, effective while at the same time beautiful. Of course you are from Texas. Border state.

What do you make of this when you look at this picture and these sharp impaling-like sticks -- steel slats, I'm sorry. Is this a wall to you?

LEE: Not only am I from Texas, Erin, but I was the ranking member on the border security and have been on homeland security for any number of years, and I've been all through the border starting from San Diego and all through the border states. And I will tell you that the president doesn't really know what's going on.

That type of fence, somewhat similar, is in San Diego and we know a large number of individuals who are desperate came to San Diego to seek refuge coming in from Central America. We know that there are families and ranchers on the border that don't want the fence.

[19:50:04] We also know that better personnel, technology has been more effective. I might also say to the American people, we want secure borders, Democrats do, northern and southern border. I passed a border security bill. Senate Democrats had a major funding of border security some years

back. And in addition, maybe the president is not aware but tunnels which are quite frequently used, as well as the fact that drugs come through the legal points of entry.

A wall will not work. I will not support $5 billion wasted money for a wall. But I am interested in making sure the government stays open and I'll be open to what agreement can be made between the majority leader and the minority leader and the president.

BURNETT: Congresswoman, I want to ask but the breaking news here at CNN tonight. Prior to Acting Attorney General Whitaker's decision to not recuse himself in the Russia investigation, right, to overrule the ethics investigation, to say, no, I'm gong to continue to oversee it, we have now learned that Trump at least two times prior to that decision lashed out at Matt Whitaker. In both instances, he was angry at Whitaker for not protecting him over things from Michael Cohen. Campaign finance, hush payments and Trump Tower Moscow.

Again, livid at him, ethics committee says you should recuse. Whitaker says no, I won't. Your reaction?

LEE: That's already a problem that he has refused to recuse himself when the original staff counsel, regular -- career DOJ lawyer said I think you have a conflict. I think the other problem is clear, is that he is not a confirmed A.G., which the regular order requires. Nor did they follow the regular order with the deputy attorney general becoming the acting attorney general.

But the real issue is, I don't know whether they expect Mr. Whitaker to be the magic man or superman, because you cannot stop an ongoing litigation or ongoing criminal investigation that one person is involved in and who is making his own separate agreements with prosecutors, no matter who you are. And I assume what he was suggesting is, that he could interfere with Mueller and with the New York state assistant attorney generals for the Southern District, excuse me, and could have stopped them from being able to continue on the agreement. That is absolutely absurd.

And anybody knows the structure of the federal government and how the AUS, the assistant U.S. attorney, investigate their matter, how Mueller is supposed to investigate their matters, that does not wash at all. There was no way that Whitaker could have stopped it short of a public display and short of Mueller telling him to stay out of his business, and also the assistant U.S. attorney in New York saying the same thing.

In addition, this defendant had the right to due process and to make his own independent decisions on how co-in essence save his life. That's what Michael Cohen was doing. And he also indicated on the record that he wanted to tell the truth, he wanted to clear his soul, he wanted to help his family. And when someone says anyone to help his country, when someone says that, I don't think you'll be able to stop anything.

May I say this? I want to wish Justice Ginsburg a speedy recovery and I do want to acknowledge that the bill that many of us worked on for so long, the sentencing reduction and first step that's going to help thousands of families passed today and was signed today. And besides all of this, something happened that is good for this country.

BURNETT: Right.

LEE: But I would conclude by saying that Whitaker would have to be a superman to intercede in Mueller's agreement and as well the U.S. attorney's agreement.

BURNETT: All right. It sounds like, what you're saying may be true. The president tried nonetheless. Thank you very much, Congresswoman. I appreciate your time.

LEE: Thank you for having me.

BURNETT: And now, Mick Mulvaney dispatched to Capitol Hill tonight trying to fend off a shutdown over this deal, slat barrier, commonly referred to as a wall, a very same wall that Mulvaney has publicly trashed on tape.

Jason Carroll is OUTFRONT.

(BEGIN VIDEOTAPE)

JASON CARROLL, CNN NATIONAL CORRESPONDENT (voice-over): As Mick Mulvaney prepares to take on a chaotic White House and head strong president, he may first have to explain his critical comments about one of Trump's key campaign promises -- building the border wall.

Listen to Mulvaney's tape during a radio interview in 2015, uncovered by CNN's KFILE.

INTERVIEWER: Immigration. Donald Trump says build a wall. Deport all illegal immigrants. Rules are rules.

MULVANEY: I've never been in the boxcar caucus. You know, ship them home in boxcars and let the Lord sort them out. The fence is an easy thing to sell politically. It's an easy thing for someone who doesn't follow the issue very closely to say, oh well, that'll just solve everything, build the fence.

CARROLL: Mulvaney made the comments to the WRHI radio station in South Carolina. And his criticism of then candidate Donald Trump's border wall did not stop there.

[19:55:03] MULVANEY: The fence doesn't solve the problem. Is it necessary to have one? Sure. Would it help? Sure.

But to say, build the darn fence and have that be the end of the immigration discussion is absurd and almost childish for someone running for president to take that simplistic view. And by the way, the bottom line is the fence doesn't stop anybody who really wants to get across.

CARROLL: Mulvaney's current role is director of the White House Office of Management and Budget, and publicly he is defending Trump's border wall.

MULVANEY: This stuff is going up now. Why? Because the president wants to make the country more safe.

CARROLL: Mulvaney has said to have lobbied hard for the office of chief of staff. Mulvaney tweeting, this is a tremendous honor. I look forward to working the president and the entire team.

That's a far cry from how Mulvaney once described Trump as a terrible human being. In 2016, when asked about the two candidates for president, Hillary Clinton or Donald Trump, Mulvaney, voiced his support for Trump but offered this.

MULVANEY: Should either of these people be role models to my 16-year- old triplets? No.

CARROLL: Also in 2016, Mulvaney criticized Trump during a congressional debate when explaining why he was reluctantly supporting the then GOP candidate.

MULVANEY: Yes, I'm supporting Donald Trump as enthusiastically as I can even though I think he is a terrible human being. The choice on the other side is just as bad.

CARROLL: And Office of Management and Budget spokeswoman Meghan Burris said in reaction to that video: This is old news. These comments were made in 2016 when he was a congressman and had yet to meet the president. Congressman Mulvaney continued to support then candidate Trump throughout the election and his support for President Trump has never wavered while serving within the administration.

(END VIDEOTAPE)

CARROLL: As to what Mulvaney said on that radio show, well, we did reach out to him as well as the White House to get some sort of reaction but they did not respond to our requests -- Erin.

BURNETT: Not surprising. Thank you, Jason.

And next, Jeanne has something to tell you about this.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I know words. I have the best words. I think have the best temperament. Look, nobody has better toys than I do.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

BURNETT: Tonight, nobody knows tech better than Trump according to Trump. That is tech, campaign finance, the list goes on and on. It even includes toys.

Here's Jeanne. (BEGIN VIDEOTAPE)

JEANNE MOOS, CNN NATIONAL CORRESPONDENT: Remember how Mohammed Ali always used to call himself the greatest of all time? Well, now, it's President Trump calling himself the greatest at all times.

TRUMP: I think nobody knows more about campaign finance than I do.

Nobody knows more about trade than me.

Nobody knows more about construction than I do.

MOOS: What field doesn't he excel in?

TRUMP: I know more about ISIS than the generals do. Believe me.

Nobody knows more about environmental impact statements than me.

There's nobody that understands the horror of nuclear better than me.

MOOS: It's enough to make your head explode.

TRUMP: Nobody knows the politicians better than I do. Believe me.

MOOS: Even political points like Corey Booker. I know more about Corey than he knows about himself.

TRUMP: Nobody builds walls better than me. Believe me.

MOOS: President Trump still knows how to spew superlatives.

TRUMP: I know words. I have the best words.

I think I have the best temperament.

Look, nobody has better toys than I do.

MOOS: And from a guy who doesn't like to read, this.

TRUMP: Nobody likes the bible more than I do.

MOOS: Thou shall not exaggerate, Mr. President.

For years, journalists have been chronicling Donald Trump's breathtaking self admiration, delivered in the third person no less.

TRUMP: Nobody has ever had crowds like Trump has had.

MOOS: Occasionally, President Trump has demonstrated a flash of humility, a flash of modesty, a moment of modesty.

TRUMP: I understand the tax laws better than almost anyone.

MOOS: Almost anyone? You mean someone understands tax laws better than he does?

UNIDENTIFIED FEMALE: Anything you can do --

MOOS: He can do better.

TRUMP: They're more elite than me. I have better everything they have, including this.

MOOS: Jeanne Moos, CNN.

UNIDENTIFIED MALE: No, you can't.

UNIDENTIFIED FEMALE: Yes, I can, yes, I can.

MOOS: New York.

(END VIDEOTAPE)

BURNETT: Where to jump the shark? Was it with the bible?

All right. Thanks for joining us.

Anderson starts now.