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Steve Mnuchin Scrambles To Call The Country's Biggest Banks And Reassure Investors That President Trump Will Not Fire The Head Of The Federal Reserve; Republican Senator Bob Corker Calls Out The President Claiming Trump Is Picking A Fight To Score Political Points; Tsunami Wipes Through That Concert And Beyond In Indonesia; President Tweeting Today That Deputy Defense Secretary Patrick Shanahan Will Begin His New Role On January 1st. Aired 2-3p ET

Aired December 23, 2018 - 14:00   ET

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

(COMMERCIAL BREAK)

[14:00:30] FREDRICKA WHITFIELD, CNN HOST: Hello, everyone. And thank you so much for joining me this Sunday. I'm Fredricka Whitfield.

We begin with this breaking news. President Trump names a new acting U.S. defense secretary. The President tweeting today that deputy defense secretary Patrick Shanahan will begin his new role on January 1st. Shanahan takes over for James Mattis who resigned just three days ago in protest of the President's decision to pull U.S. troops out of Syria. And CNN has learned that Mattis will leave earlier than the expected February 28th date all because the President is reportedly upset with the extensive coverage of Mattis' resignation.

Meantime, the President's treasury secretary playing clean up after Trump reportedly considered firing the head of the Federal Reserve. Steve Mnuchin says now, I'm quoting now, "realizes he doesn't have the authority," end quote, to do that. Mnuchin also calling executives of large U.S. banks after rate hikes and historic market drop, raising concerns about the overall economy. All of this coming as the government shut down shows no signs of ending soon. The President's top negotiators now expect the standoff to go past Christmas and likely into the New Year.

All right. More now on the breaking news and the President's new acting defense secretary as of January 1st.

CNN Pentagon correspondent Barbara Starr joining us now.

So Barbara, what do we know about the deputy defense secretary Patrick Shanahan and how he became the President's pick for the top job now?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, hi Fred.

What we know that Mr. Trump became very upset when he began seeing the extensive coverage of the departure of James Mattis and that Mattis' letter of resignation was a total rebuke of Mr. Trump's military and initial security policy. As we know, Mattis' letter is talking about the need to defend allies on the battlefield to take a hard line with countries like Russia and China. So the President began to see the rebuke very clearly. And we are told this morning Secretary Mattis received a phone call from the administration saying he would be gone by January 1st. That puts into place Patrick Shanahan, the number two here at the Pentagon, the deputy secretary of defense.

Who is Patrick Shanahan? Well, before he game number two here. He was a long time executive at Boeing, a major defense contractor. Mr. Shanahan having several positions over his 30-year career at Boeing both with a commercial airplane side of the business, the airplanes we travel on and also defense and military programs at one point being senior vice President in charge of supply chain and operations.

Since he came to the Pentagon, he sort of been the inside man, working on budgeting and spending and acquisition reform and innovation, getting that space force, space command going that President Trump wants.

These are the typical job that a deputy secretary of defense does. But now he will be on the world stage having to deal with America's allies and adversaries. And it will be interesting to see, right now, seen as a stabilizing choice because he is already here. But will he be named to be the permanent secretary of defense perhaps for the rest of the Trump administration -- Fred.

WHITFIELD: OK, Barbara. And then one has to wonder how much this surprised Mattis because in that resignation letter, he said he wanted to stay on until February 28th to help with the transition of whoever his successor would be.

In fact, here is the letter and it says in part, the end day for my tenure is February 28th, 2019, a date that should allow sufficient time for a successor to be nominated and confirm as well as to make sure the department's interests are properly articulated and protected at upcoming events to include congressional posture hearings and the NATO defense ministerial defense in February.

Further, that a full transition to a new secretary of defense occurs well in advance of the transition of chairman of the Joint Chiefs of Staff in September in order to ensure stability within the department.

So now having that been said, the President making sure that it's the deputy defense secretary who gets that job January 1st. Is there concern about a smooth transition?

[14:05:00] STARR: But, let's be clear. Mattis is going to be gone in a week. For all we know, and we don't know, he might be upstairs here in the Pentagon in his office right now packing his boxes. He will be gone in just a few coming days. So Shanahan will have to take over at the NATO ministerial upcoming. He will have to present the department's multibillion, hundreds of billions of dollars in budget spending to Congress. I suspect he will have to rely on general Dunford, the chairman of the joint chiefs.

But let me add one thing very quickly, don't expect a big public farewell to the troops from Jim Mattis. Right now, we are being told very quietly that Mattis simply planned to essentially fade away. He does not want to cause more instability and others are well aware that the troops, the rank and file are unsettled by this and asking a lot of questions - Fred.

WHITFIELD: All right. Barbara Starr, thank you so much.

All right. Let's talk more about this with lieutenant general Mark Hertling. He is a former army commanding general in Europe in seventh army and a CNN military analyst. Also with me is Lynn Sweet, Washington bureau chief for the "Chicago Sun Times."

All right, thanks to both of you.

So general, let me begin with you and get your reaction to the President naming the deputy, you know, secretary of defense as the successor as of January 1st, despite the fact that Mattis wanted to stay on at least until the end of February for a smooth transition. What are your thoughts or even concerns?

LT. GEN. MARK HERTLING, CNN MILITARY ANALYST: A few concerns, Fred. But this was probably going to happen anyway. The deputy secretary usually steps up whenever the secretary moves away. But as Barbara so excellently described, the deputy secretary that is usually Mr. or Ms. Insight. And the secretary is Mr. Outside more concerned with national secretary it bears being a member of the primaries committee and dealing with allies.

Mr. Shanahan has not had that kind of experience. The reason secretary Mattis decided to stay until the end of February and he stated this, was he wanted to do a few more of the ministerials, that very important NATO ministerial which is being held next month. And now, all those NATO ministers of the defense are going to meet Mr. Shanahan for the first time and it will be his first time in that kind of world stage.

WHITFIELD: How difficult or awkward will that be?

HERTLING: Well, extremely difficult. And in fact, some of my former colleagues from Europe, I have been receiving texts and emails from other government military and civilian officials since the resignation of the secretary last week basically asking me what's going on. Because they saw secretary Mattis as a very calming force.

The President would go into some of the NATO meetings caused a ruckus and secretary Mattis would come and afterwards then calm people down. So he is going to be a tough act to follow not just with military member who is has a 90 percent approval rate, unusual for any civilian secretary. But with foreign dignitaries and defense minsters all around the world, this is going to be tough, very tough what I would say. And it just shows the President is really being petulant on this naming this guy and not giving secretary Mattis the opportunity to do these final ministerials and wrap things up, if you will, with other foreign leaders.

WHITFIELD: And then, Lynn, you know, we are learning that the President really is making this announcement because he doesn't like the kind of coverage that Mattis' resignation is getting and, you know, people trying to decipher, you know, every word, you know, in his resignation letter. Will this change the dialogue? LYNN SWEET, WASHINGTON BUREAU, CHICAGO SUN-TIMES: The dialogue with

Congress will just get tougher so President Trump when he nominates someone to be the permanent defense secretary also has to nominate someone to be the permanent attorney general.

He has two big potential battles with the Senate over those appointees so that will change that dialogue with Congress. It will probably -- I'm just making a guess, no one has said this yet, but when the House Democrats come into power, it would also be a dialogue-provoking situation when I'm sure that some committee is going to ask Mattis to come discuss either the circumstances around this resignation or some other military-related issues. So that will be something that will impact the dialogue.

And then the last thing is, as we are pointing out on this segment, the lack of international relations experience by the acting defense secretary is something not to be ignored with how Trump may or may not shape future policy. We know that today Trump had another conversation with the Turkish leader, Erdogan, and now he is talking about a very slow pull out of troops in Syria.

So if he is going to govern our military movements by tweet and not consult, why would there be -- we will also be in this dialogue looking to see how Shanahan deals with the White House.

[14:10:03] WHITFIELD: So general, you know, Mattis left after, you know, protest for the President's decision to pull out U.S. troops of Syria. You also have the resignation of the Presidential envoy on ISIS, you know, Bret McGurk, yesterday as well. And you also have the incoming chief of staff, you know, who said, you know, the President has no plans about changing his mind on pulling out U.S. troops from Syria. Take a listen.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Any chance the President changes his mind about this and reverses course?

MICK MULVANEY, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET: No. The President told people from the very beginning that he doesn't want us to stay in Syria forever. You are seeing the end result now of two years' worth of work.

(END VIDEO CLIP)

WHITFIELD: So now, how does all of this kind of set the stage for Shanahan?

HERTLING: This is what's going to contribute to the chaos, Fred. You know, it's interesting that Mick Mulvaney who doesn't have a strong defense background or national security background is saying something like that because truthfully all of our national security strategies and policies thus far has been based on lessons learned. Some of the poor lessons learned from the Obama administration. Don't base withdrawals on numbers. Base it on a strategy. So the President has actually countered his strategy, which was

conditions-based in both Afghanistan and Syria when he said let's just cut it 7,000 in Afghanistan. Let's pull everyone out of Syria. It has thrown our allies for a loop and it has thrown those inside the military for a loop truthfully.

The commanders of these organizations don't know what's going on as exhibited by the Marine Corps come during his visit to Afghanistan and Alaska when marines were asking what's next and he said I truthfully don't know. So there are military members confused. There are diplomats with Bret McGurk's resignation who are also confused about what's next.

While the other thing I need to point out about secretary Mattis in the Pentagon, he was a draw to (INAUDIBLE). He brought quite a few people, many of the undersecretaries and assistant secretaries of defense into the Pentagon. They will stay around until the start of the next Congress if they had not been confirmed.

So I think a lot of the acolytes of Jim Mattis you are going to see depart too and that is going to leave some mass of some reinstate, some massive stuck in chest wounds to deal with as the new Congress comes in and the secretary or the defense department is still trying to do their thing.

WHITFIELD: And then Lynn, what does it say about the President putting his stock in? I mean, you got Shanahan who is, you know, former Boeing executive, Mattis, marine general out, John Kelly, you know, is chief of staff on his way out, a marine. I mean, what ever happened to, you know, trusting his generals? Is he showing that now it's the business community where he really feels like he is most comfortable dealing with and interacting with people with the back ground?

SWEET: Well, it turned out that he has -- remember, he said during the campaign that he knows more than the generals. So now that he was in the position or maybe that that foundational belief of the President has been challenged, he says, OK, I guess I got the wrong generals around me. So I think he moves on in lightning speed to whatever is he has to have a comfort level. He doesn't like to feel like people don't treat him as an intellectual equal. We know this time and again, that is a motivating force when he feels diminished. These are signs that I will leave it to psychologists to analyze, as to the security or insecurity of President Trump. But I think people have common sense here when they see these moves of what a leader does. So these are - you know, but I think the big take away here is yes, he leans towards the business community now more than the military.

WHITFIELD: All right, Lynn Sweet, General Mark Hertling, thank you so much to both of you. Happy holidays.

SWEET: And thank you.

WHITFIELD: All right. Still ahead, treasury secretary Steve Mnuchin scrambles to call the country's biggest banks and reassure investors that President Trump will not fire the head of the Federal Reserve. This as fears about the economy show no signs of calming down. So what's the strategy heading into the new year?

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[14:18:29] WHITFIELD: After the single worst week for U.S. stock market since 2008, the treasury secretary is trying to convince investors that they have nothing to fear. Well, CNN has learn Steven Mnuchin has been calling around to big banks talking up the economy and shooting down reports that President Trump might try to fire the head of the federal reserve. The President blames Jerome Powell who he appointed a year ago for a series of hikes that have helped sent stock markets plunging.

Stephen Moore joins me right now and he was an economics adviser to candidate Trump and now as a CNN senior economics analyst. Good to see you, Stephen.

STEPHEN MOORE, CNN SENIOR ECONOMIC ANALYST: Hi, Fredricka.

WHITFIELD: All right. So we are about six hours before the Asian markets open. Would these efforts by the treasury secretary in any ways kind of allay fears?

MOORE: Well, look, I think that President Trump is obviously very frustrated with the fed chairman Powell. By the way, it was Donald Trump who appointed Chairman Powell. I think - I talked to him a couple of weeks ago. He was very frustrated. He thinks he made a mistake. There is a big debate raging now about whether the President could replace Chairman Powell. There is different opinions about that.

But I would say this, Fredricka. If you look at what happened this week, this massive selloff, there is no question that it was all triggered by what I think and President Trump thinks it was a disaster increase in interest rates at a time when they should be cutting rates. And you know, while Chairman Powell was speaking and announcing this, the Dow Jones fell by something like 600 or 700 points and it has kept falling.

So I think a lot of people are very frustrated that may be this chairman is not competent and up for the job.

[14:20:07] WHITFIELD: OK. Except now, I mean, you know, Mr. Mulvaney is also among those who are now saying that don't worry about it, you know. The President now knows he is trying to fire Powell. It's not a good idea and that is not going to happen. But the immediate concern is the markets, the volatility. And there are many contributing factors, right. It is not just the interest rates.

MOORE: That's true.

WHITFIELD: But also talk of this government, you know, shut down and when things might be operational again.

MOORE: Yes. WHITFIELD: So how much, you know, is riding on the actions of the

White House at Capitol Hill to help stabilize things.

MOORE: Well, look. I think the government shut down as an economic event is kind of (INAUDIBLE) look. Certainly is going to affect some of the government workers but this is Christmas weekend. There is not a lot of government workers working over Christmas weekend.

And look. I think there is a lot of confidence that this will get resolved sometime right after Christmas. I hope it does, you know. I don't want to see the government shut down.

The other factor, by the way, Fredricka, that I think is much bigger in terms of nervousness and swinishness of investors, of course, is this trade war that we are in with China. And you know, what I have been telling investors and others is look, it is true that this is a very uncertain situation. Donald Trump has given the Chinese 60 days now to get come forward with a deal.

If Trump can get a deal, which -- and we don't know if that's going to happen, but if he could, then I think you would see a real boom in the stock market where investors really want to see that trade war get resolved in a way where China makes concessions as they should to the United States.

WHITFIELD: Right. And while it is the holiday, I mean, you do realized a lot of federal workers whether they are working or perhaps they have paid time off, they are among those 800,000 who will not be paid as long as the government is down. So government doesn't stop working because of the holiday season.

All right. So, you know, the political lesson though for the President is there, isn't it? If he wants to take credit for a booming market, does he also take the blame when it tanks?

MOORE: Sure. I mean, look. The President, you know, the President gets the praise when the economy does well and he gets the deserved blame when the economy doesn't do well.

You know, what's so interesting to me, Fredricka, we are now at the end of 2018. This was the best year for the economy in terms of jobs, in terms of the lowest unemployment rate, in terms of industrial production and manufacturing. We are now have seven million more jobs than people to fill them. The growth rate this year will come in at about 3.25. That's way higher than we have had any time in the last 10 years. So the real economy is doing pretty well, whereas the stock market as done lousy. So there is kind of divergence of where the financial markets are headed in the economy at the same time.

WHITFIELD: All right. Steve Moore, happy holidays to you.

MOORE: You, too. Merry Christmas.

WHITFIELD: All right, thank you.

All right, talking about this shut down. Republican senator Bob Corker calls out the President claiming Trump is picking a fight to score political points. This as the country braces for the shut down and we continue into the New Year. Details on that next.

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[14:27:32] WHITFIELD: All right. It is day two of the shutdown standoff in Washington and there is no end in sight. Negotiations are still at a standstill with neither the President nor Democrats willing to budge on border wall funding. And now lawmakers are - they have headed home for the holidays. And the next Senate session is set for Thursday.

One Republican senator is now calling out the President, saying the whole shut down is just a political act. Listen.

(BEGIN VIDEO CLIP)

SEN. BOB CORKER (R), TENNESSEE: This is a purposefully a fight over at the end of the day, even no matter who wins, our borders are still going to be insecure. Just a few months ago, the President could have received $25 billion in border security just by dealing with the Dreamers, which by the way, most Republicans want to deal with the Dreamers' issue. So we had $25 billion that could have been spent on border security. Now the government is shut down over what ultimately is going to be $2 billion. This is a made up fight so that the President can look like he is fighting, but even if he wins, our borders are going to be insecure.

JAKE TAPPER, CNN CHIEF WASHINGTON CORRESPONDENT: I just want to - just to understand this. You are saying that President Trump if he wants that money for the border wall for border security, he can get it, but he needs to make a deal but he doesn't want to make a deal. He just wants a campaign issue. Am I hearing you correctly?

CORKER: It has to be that because this is like falling off a table. The Democrats easily would support more border funding, border security. They have said that. Twenty-five of them came to the floor and voted for something that provided $25 billion worth of border security in exchange for dealing with Dreamers. And Republicans want to deal with the dreamers.

(END VIDEO CLIP)

WHITFIELD: All right. Let's check in with CNN's Sarah Westwood live for us at the White House.

So what is the President's position? He is there in the White House. Apparently, he and the vice president have said that they are working, trying to negotiate. But what is the status?

SARAH WESTWOOD, CNN WHITE HOUSE REPORTER: Well, that's a great question, Fred. The White House at the moment is buckling down for what could be a lengthy shut down lasting days beyond Christmas as the President is still continuing his demands for funding for the border wall and Democrats are continuing their refusal to fund it. The President initially requested $5 billion for the border wall and

he said that had to be for the construction of a physical barrier along the southern border. He said that couldn't be just for border security in general.

Now sources say vice president Mike Pence offered support for a border security package worth $2.5 billion that included funding for the border wall during a meeting yesterday on Capitol Hill with Senate minority leader Chuck Schumer. Sources say Schumer rejected that offer. So the talks do appear to still be at a standstill.

Now budget director Mick Mulvaney predicted this morning that the shutdown could last into the next Congress up against on January 3rd when House Democrats take over. And Mulvaney also suggested that House minority leader Nancy Pelosi's race for the speakership could be preventing her from being able to make a deal with this administration that would reopen the government. Take a listen.

(BEGIN VIDEO CLIP)

[14:30:46] MICK MULVANEY, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET: here is the problem, of course, is that as recently as two weeks ago they had offered us $1.6 billion for the same thing. So they are moving in the wrong direction. I think it is a really good question here as to whether or not this deal can be cut before the new Congress comes in. I think there is an implication here for Nancy Pelosi's election for the speakership. I think she is now in that unfortunate position of being beholden to her left wing to where she can't be seen as agreeing with the President on anything until after she is speaker. If that is the case, again, there is a chance we go into the next Congress.

(END VIDEO CLIP)

WESTWOOD: Now, as Mulvaney speaking on FOX News Sunday this morning, note that he is also the incoming chief of staff.

Now Trump has been all over the map when it comes to the funding fight at first saying he would be proud to own it and now he is attempting to pin the blame on the Democrats. But it is still unclear how much less than $5 billion will ultimately be willing to support and what if anything the Democrats would be willing to offer.

Remember, Fred, that Democrats have very little incentive right now to negotiate on Trump's terms given that control of the House will change hands in less than two weeks now.

WHITFIELD: All right, Sarah Westwood, thank so much from the White House.

All right. Let's talk more about this now. Columnist for "the Washington Post" and CNN political analyst Josh Rogin is with me.

So John, what about that, what Mulvaney is saying about Nancy Pelosi, you know, that she really her hands are tied behind her back until she gets that speakership job. She has not seemed like she was going to budge either way on money for a wall.

JOSH ROGIN, CNN POLITICAL ANALYST: Right. I don't think the director argument really makes any sense at all. Because of course, Nancy Pelosi is going to get elected speaker. There is not really any doubt about that. Her hands are not tied at all.

I think what Sarah was said was absolutely right which is why would Nancy Pelosi feel like her leverage is going down when she is about to take over the House of Representatives. Actually, her leverage is going up. And then a new Congress, she will have more power, not less. And the administration knows that. That's why they have an incentive to get it done sooner rather than later. But nobody knows what the President is willing to agree to. So nobody can really negotiate in Good faith. So it's impossible to make a deal.

And you know, the other thing that Sarah said that I think is absolutely right is that, you know, there is a political need for the President to fight this fight, OK. And so, that is his incentive. And he is using this shut down as the example to his base than he is actually doing.

WHITFIELD: Even if, as Bob Corker said, it is really going nowhere. This is just political posturing. And then again on the whole issue of who will be paying for this wall in the campaign trail and beyond, the President said it would be Mexico. Well, this was the budget director, Mick Mulvaney on how in his view, Mexico would be paying for this wall. Listen.

(BEGIN VIDEO CLIP)

MULVANEY: If you ask to the President, he will point to immediately to something else that didn't get a lot of news in the last couple of weeks which is this new U.S.-Mexico, Canada agreement, the U.S. MCA which is so much better for us than the NAFTA deal that American workers are going to do better. The government is going to do better and you can make the argument that Mexico is paying in that fashion.

UNIDENTIFIED MALE: But none of that is Mexico paying for the wall.

MULVANEY: Let's just be clear. You and I both know that it cannot work exactly like that. I can't spend any money at the office of the management budget or department of homeland security can't actually spend money for Mexico would have to get it from the treasury.

(END VIDEO CLIP)

WHITFIELD: All right. So Josh, there is no money or payment from Mexico in any kind of trade agreement.

ROGIN: Of course not. I mean, the whole idea is ridiculous on its phase. And you can see Mick Mulvaney sort of admitting that in a way by saying that we have to get the money from the treasury.

In the end, I think the only thing that will matter is whether or not the President of the United States can point to a wall and say look, I did this. And he knows that and the Democrats know that and that is why he has dug into his position. That's why Schumer and Pelosi are dug in to theirs.

He is going to lose that battle, OK. He doesn't have power of the purse. He can't force Congress to appropriate money to build a wall and he can't build it without them. That's why he is throwing his temper tantrum now. That's why he is doing this now.

But this whole idea that these government shutdowns represent real leverage, that leverage dissipates the more he uses them. If we have a shutdown every six months, people get used to it. People get normalize to it. And obviously, it is not moving the Democrats. So whether it goes on for four more days or four more weeks, ultimately, I don't see a path where the President gets the wall.

[14:35:05] WHITFIELD: Even if the price is coming down, it was $5 billion for the wall and now the White House by way of the vice president saying we will come down to $2.5 billion. Will that make a difference?

ROGIN: Right.

WHITFIELD: All right, Josh Rogin. Thanks so much. Appreciate it.

ROGIN: Thank you.

WHITFIELD: All right. Next, a story making international headlines, hundreds of dead and many more injured after a devastating tsunami hits a popular resort area. We will tell you why people were caught off guard as the water came crashing ashore.

(COMMERCIAL BREAK)

(VIDEO CLIP PLAYING)

[14:40:19] WHITFIELD: Without warnings, tsunami wipes through that concert and beyond in Indonesia. This tsunami slammed a popular beach resort area catching so many off-guard. It was apparently triggered by a volcanic eruption and underwater landslide. At least 222 people have been killed. Hundreds more are injured, 28 people are unaccounted for. The nation now facing a grim recovery effort.

Here is Pauline Chiou.

(BEGIN VIDEOTAPE)

PAULINE CHIOU, CNN CORRESPONDENT (voice-over): Rescue and recovery efforts are under way on the coast of Sunda Strait where the deadly tsunami flattened the buildings, knocked out power and blocked roads. Authorities are starting to identify the victims. Hospitals are treating the injured.

The tsunami struck around 9:30 Saturday evening during a holiday weekend when resorts on the shoreline are full of tourists. The water broke through a stage while the Indonesia pop band, 17, was performing near the beach. The next morning, the lead singer made this statement on his Instagram account. IFAN, SINGER CAUGHT IN TSUNAMI (through translator): I just wanted to

say that our bass player, Banny (ph) and our manager Oki Wijaya (ph) passed away. Also my dear wife is still missing. The rest of us have broken bones and minor injuries, including me. But we are fine.

CHIOU: Officials say the tsunami was triggered by volcanic activity arising from (INAUDIBLE). That's a volcanic island in the middle of the strait. Officials say a full moon and high tide may have made things worse.

Tsunami warning signals did not go off because officials say it was not an earthquake, but rather a landslide caused by the volcanic eruption that may have triggered the deadly waves. Authorities are closely watching the volcano for any more dangerous eruptions.

Pauline Chiou, CNN.

(END VIDEOTAPE)

WHITFIELD: And if you want to help the victims of the tsunami, you can go to CNN.com/impact to find out ways to assist.

We got so much more straight ahead in the NEWSROOM right after this.

(COMMERCIAL BREAK)

[14:47:58] WHITFIELD: 2018 has proven to be a very busy news cycle in so many categories including politics, sports, business and entertainment.

CNN's Brooke Baldwin takes a look at some of the trending stories that captured our attention in our eight in 2018.

(BEGIN VIDEOTAPE)

BROOKE BALDWIN, CNN CORRESPONDENT (voice-over): 2018 was the year of the social media activist. People across the country speaking out against sexual assault, gun violence and racism. #activism proved it's a force to be reckoned with.

Here are our top eight trending stories of the year.

Time's up in 2018. On January 1st, a group of women in the film industry unveiled time's up as an anti-harassment action plan, a sequel to last year's the Me Too reckoning.

UNIDENTIFIED FEMALE: We are just pushing the movement along and doing what we can with our voices and our solidarity.

UNIDENTIFIED FEMALE: We are here in standing in solidarity with women everywhere saying time's up, enough is enough on sexual harassment assault, abuse of power.

BALDWIN: The group created a legal defense fund to support women who encounter sexual assault, harassment or inequality in the workplace. Especially those outside the entertainment industry who lack financial or legal resources.

OPRAH WINFREY, TV HOST: And now that we have all joined as one voice, it feels like empowerment to those women who never had it.

BALDWIN: Number seven, do you hear Yanni (ph)? Do you hear Laurel? Similar to 2015, it is great dress debate, a computerized recording of two seemingly unrelated words divided the internet again in 2018.

UNIDENTIFIED MALE: It says Laurel.

UNIDENTIFIED MALE: Play it. Hold on.

UNIDENTIFIED MALE: Yanni.

UNIDENTIFIED MALE: Yanni.

UNIDENTIFIED MALE: No.

BALDWIN: And it seemed everyone had an opinion from law enforcement --

UNIDENTIFIED MALE: What we determined is that the audio sound you have been hearing is actually the name Laurel.

[14:50:04] BALDWIN: To Capitol Hill.

REP. PAUL RYAN (R), HOUSE SPEAKER: It is Laurel and not Yanny, all right? Come one. How many Laurel fans here? OK. Thank you.

BALDWIN: In the end, science called a winner.

UNIDENTIFIED MALE: If you heard Laurel, you are correct.

BALDWIN: And like the dress, Yanny or Laurel served as further proof it doesn't take much to break the internet.

Number six.

HANNAH VAUGHAN JONES, CNN CORRESPONDENT: About this amazing face of Spiderman as he is being dubbed.

BALDWIN: He was a young migrant from Mali living in the shadows, but in the span of 30 seconds, Mali Gasma's (ph) selfless act of bravery captivated the world. Gasma (ph) scaled a four-story building in Paris with his bare hands to save a child's life. For his heroism, French president Emmanuel Macron granted him citizenship. Gasma (ph) now works with the Paris fire brigade.

Number five. a deep sigh of relief after 38 agonizing minutes. With nuclear tensions between North Korea and the United States running high, people in Hawaii got this text. Ballistic missile threat inbound to Hawaii seek immediate shelter. This is not a drill. And emergency alert that sent panicked families to seek shelter anywhere they could, with some even putting their children in storm brains. Within 12 minutes, Congresswoman Tulsi Gabbard tweeted that this was a false alarm, but there was no word from the governor who admitted he forgot his twitter password.

UNIDENTIFIED MALE: What happened today was totally unacceptable.

BALDWIN: It took 38 minutes for the emergency alert system to declare a false alarm.

Number four, a different kind of activism rocked the internet when dozen of viral videos exposed racism every day racism aimed at African-Americans. Barbecue Becky, Permit Patty, pool patrol Paula, these women got the mean treatment after they called police on black people doing everyday things in public places. Even Starbucks got a share of social media's scorn after two black men were arrested for waiting at a store in Philadelphia. Starbucks later apologized for the incident and launched employee anti-bias training.

Number three, Professor Christine Blasey Ford publicly recounting her alleged sexual assault.

CHRISTIN BLASEY FORD, VICTIM: It's hard for me to breathe and I thought that Brett was accidentally going to kill me.

BALDWIN: Ford accused then Supreme Court nominee Brett Kavanaugh of assaulting her when they were just teenagers, an accusation he repeatedly denied. President Trump mocked Ford's testimony in a campaign rally.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: How did you get home? I don't remember. How did you get home? I don't remember. Where was the place? I don't remember. How many years ago was it? I don't know.

BALDWIN: In a series of tweets, Trump claimed that if the attack Ford alleged quote "was as bad as she said," charges would have been immediately filed with local law enforcement authorities.

The hash tags we believe doctor ford and we believe survivors and dear professor Ford started trending as hundreds of thousands of women took to social media to express their solidarity and using the hashtag, why I didn't report. Countless more spoke with feeling ashamed and powerless after their own sexual assault experiences of no one believing them.

Number two, in Parkland, Florida. Marjorie Stoneman Douglas high school turned the worst day of their lives into a political movement.

UNIDENTIFIED MALE: We can say, yes, we are going to do all these things. Thoughts and prayers. What we need more than that is action.

BALDWIN: Students created the never again movement to prevent gun violence and help organize the march for our lives in Washington, D.C. which became the most tweeted about movement of all of 2018.

More than $2.5 million was raised for a march for our lives via Facebook fund-raisers giving President Barack Obama's inspirational tweet about the march became the second most liked tweet of the year. And number one, never before has a President used social media quite

like this. Communicating directly with more than his 57 million followers. From antagonistic tweets about world leaders and political foes to trafficking in half truths. @real Donald Trump helped set the tone for the days' news coverage and political discourse.

Whether he is blasting what he calls the rigged witch-hunt of the Mueller investigation, calling the media fake news or heaping praise on allies and supporters, the President tweet and retweeted more than 3,000 times in 2018 and is the most tweeted about political figure of the year.

TRUMP: Make America great again.

(END VIDEOTAPE)

[14:50:00] WHITFIELD: Right. And the news doesn't stop.

Next, more on our breaking story. President Trump forcing defense secretary Mattis out by the New Year, already naming a replacement. But will it be a smooth transition? We will discuss next.

(COMMERCIAL BREAK)

[14:59:47] WHITFIELD: Hello again, everyone. Thanks so much for joining me this Sunday. I'm Fredricka Whitfield.

We begin this hour with the developing story, President Trump naming a new acting defense secretary. The President tweeting today that deputy defense secretary Patrick Shanahan will begin his new role on January 1st. Shanahan takes over for James Mattis who resigned just three days ago in protest of the President's decision to pull U.S. troops out of Syria and CNN has learned that Mattis will leave now earlier than the February 28th date all because the President is reportedly upset with the extensive coverage of Mattis's resignation.